1.Randy Risktaker and Cal Cautious decide to go into business together.Their plan is to buy candy in bulk from a local grocery store, repackage it into small plastic bags, and sell the bags to customers on their way into the local movie theater.Cal is concerned about personal liability, so after talking it over with Randy, Randy agrees that the business will be operated as a limited partnership, with a 50/50 split of profits but Randy bearing all risk for any obligations of the partnership.No formal papers are filed with the state.

a.What kind of business organization have Randy and Cal formed?Explain your answer.

b.A customer buys a bag of jelly beans from Cal outside the movie theater.While watching a movie inside the theater, the customer reaches into the bag, pulls out a small pebble that feels like a jelly bean, bites down on it and chips a tooth.The customer files suit against Randy and Cals business, Randy and Cal individually, the grocery store, and the manufacturer of the jelly beans.Describe the strength of the customers case against each of these defendants.

c.The movie theater has a policy against customers bringing in outside food.What legal recourse, if any, does the movie theater have against Randy and Cals business? Explain your answer.

2.Joes Plumbing LLC is a properly registered Limited Liability Company in the (fictional) state of Carey.Joe T. Plumber is the sole member of the LLC.Joes Plumbing LLC enters into a $20,000 contract with Dave Developer to install plumbing fixtures in an office building Dave is building in the neighboring (fictional) state of Hopkins.The contract includes (a) a clause stating that the contract is governed by Hopkins law; (b) a clause limiting any claim for consequential damages against Joes Plumbing LLC to $100,000; and (c) a clause requiring any dispute arising out of the contract to be resolved through arbitration.Two weeks after Joes finishes its work on the project , the building suffers extensive damage from flooding from a leaking pipe, which Dave claims is the result of poor workmanship by Joe (Joe disputes this and blames other contractors for damaging the pipe).

a.Dave files a lawsuit against Joes Plumbing LLC in Hopkins state court.Joe asks the court to dismiss the suit because of the arbitration clause.However, there is a statute in the state of Hopkins that says arbitration clauses in construction contracts involving out-of-state contractors are not enforceable.How is the court likely to rule on Joes request to dismiss the suit? Explain your answer.

b.Assume that the dispute goes to arbitration and the arbitrator rules in favor of Dave in the amount of $200,000, based on the arbitrators conclusions that plumbers are strictly liable for damage caused by leaks from pipes they install, and that the clause limiting consequential damages to $100,000 is against public policy and therefore unenforceable.These rulings derive from misunderstandings of Hopkins tort and contract law.What recourse if any does Joes Plumbing LLC have from the incorrect rulings by the arbitrator?Explain your answer.

c.Assume that Dave obtains a legal judgment for $100,000.00 against Joes Plumbing LLC.Joe claims that Joes Plumbing LLC has no assets, but in part that is because he never opened a separate bank account for the LLC.If Dave goes to court to try to collect personally from Joe for the judgment, and there is no precedent (no court decisions) in the state of Carey for holding a member of an LLC liable for obligations of the LLC, how will the court decide the issue?Explain your answer.

3.WB Inc. is a properly registered corporation in the state of Carey.The corporations primary line of business is the manufacture and sale of wheelbarrows in the United States.In an effort to expand the business internationally, WBs CEO, Bob Boss, promotes one of WBs sales employees, Sam Shady, to the newly created position of vice president for international sales.Dan Disgruntled, another salesperson who was passed over for the promotion, sends a letter to the Board of Directors criticizing the CEOs decision and describing Sam as a loose cannon.Bob immediately terminates Dan from his job.

a.Does Dan have a viable claim of wrongful termination against WB?Explain your answer.

b.Assume Sam does a poor job, spending a lot of company money building up an international sales office but bringing in very little new business.Does the corporation or its shareholders have any recourse against Bob for the poor decision to promote Sam?Explain your answer.

c.Assume Sam quits and goes to work for a competitor, NEWBIE, Inc.Sam did not have a non-compete agreement (they are not allowed in the state of Carey).Does WB have any recourse against Sam, or NEWBIE, if Sam uses the knowledge of the industry that he gained by working for WB to benefit his new employer? Explain your answer.

d.NEWBIE, Inc., begins selling a new wheelbarrow in the United States that WB believes infringes one or more of WBs U.S. patents.After some negotiation, NEWBIE agrees to a license agreement under which NEWBIE agrees to pay WB $1 for every wheelbarrow sold by NEWBIE in the United States.The agreement says nothing about sales outside the United States.If NEWBIE begins selling its new wheelbarrow model in Canada, does WB have any claim against NEWBIE in connection with the sales in Canada, based on either WBs U.S. Patents or the license agreement? Explain your answer.

4.Grannys, Inc. is in the business of selling apple-based products, such as apple sauce, apple butter, etc.Grannys uses a logo of a green apple with a bite taken out of it on its products:

Apple, Inc. (the real company) uses as one of its trademarks the image of an apple with a bite taken out of it: