Part 1 - Fact Situation: Identification of Legal Issues

Instructions:Identify the legal issues and provide a clear statement of each legal issue presented.An example of a properly stated issue based on the facts in the Prologue would be " Did QPI violate the Equal Pay Act of 1963 by paying Maggie and other women less than Bill and other men for equal work?"Note that you do not need to know all the facts, and you do not need to try to answer the question presented; you only need to identify the issue and cite the relevant law(s) or legal theory.You should list a legal issue even ifpretending that you were a juror hearing the issue in courtyou do not believe there has been an actual violation of the law.Going back to the example from the Prologue, even if you believe that QPI should be found not guilty of violating the Equal Pay Act for paying Maggie less than Bill, you should still list the issue.In other words, you should list an issue if you think that a reasonable attorney working at QPI would want to research the issue.

FACTUAL SCENARIOS FOR PART 1

1.Nouv scheduled a follow-up meeting with Maggie and gave her the following assignments:

a."Maggie, I want you to draft a confirmation letter for a deal I reached with Dependable Optics Associates, Inc. ("DOA," a company traded on the New York Stock Exchange).We agreed to do some purchasing transactions back and forth so that both companies can show higher sales this quarter.We also decided on some minimum retail prices for our lenses, so we can put an end to our price war and both make more money.QPI really needs good sales numbers because I'm planning to take the company public within a year.I'll reward you very well if you can pull this one off without making it look suspicious."Maggie knew that DOA was QPI's toughest competitor, but she was caught off guard and all she could say was: "Sure Nouv, I'll draft something up for you."Nouv went on: "Here's the phone number and e-mail for my contact at DOA.Give her a call directly when you are ready to finalize things."

b.Nouv continued: "I need to get rid of some of Bill Bright's people.I don't like their work ethic and I don't think they're loyal employees. Here's the list and my reasons:

i.Gary Gray (changed from Alan Aged). He's way more productive than our junior workers, but he has been here so long that his compensation package is too expensive.After you fire him, his salary will be able to cover at least two or three entry-level employees.

ii.Pam Pendragon. She just made a big deal out of telling everyone she's engaged so I don't see her working very hard or staying around much longer anyway.

iii.Lisa Lutz.She's been paid the same as the men who are at the same level of seniority as her.But she's such a pain in the neck, she keeps complaining that other women are getting paid less than the men.I don't want to have to deal with her anymore.

iv.Larry Lotus, I saw him on some documentary film about reggae.He was dancing at an outdoor concert at Red Rocks, and he was passing around a cigarette that looked like marijuana.

Nouv closed this issue out by saying, "Maggie, I see these as the first steps in you taking over Bill's group."Maggie said: "Sure, Nouv, I'll take care of it."

c.Then Nouv cleared his throat and his facial expression softened."Maggie, I really admire your work here.Running QPI is so much more difficult than I thought it would be.I made my money by investing in Bitcoin.I just don't know whether I'm really the right person to run this company.Do you think I should go back to school and get an MBA?"Maggie made a hasty exit from Nouv's office while mumbling: "I don't know, Nouv, I'll have to think about that one."

2.After her meeting with Nouv, Maggie got to work following his instructions.

a.Maggie wanted to get the firings over with, so she went in turn to Gary (changed from Alan), Pam, Lisa, and Larry and told them they were being terminated because they lacked the work ethic required to succeed at QPI.When Maggie fired Pam, Pam started crying.Pam told Maggie that she was pregnant and begged Maggie to give her time off instead of firing her.Maggie refused.

b.When Maggie told Gary he was being fired, Gary tried to spit in her face.Maggie's reflexes kicked in and she ducked just in time, so that none of the spit hit her.Maggie then called security and had Gary escorted from the building.Maggie slumped down at Gary's desk, a little shaken from the confrontation.As she was pulling herself together, she glanced at Gary's computer screen and saw that he had been drafting an e-mail to one of the employees in his group, Reggie Reynolds.The e-mail said: "Where did you get those cornflower blue pants, Reggie?Did you borrow them from your wife?Does she have a matching blouse you can wear with them next time?"Several other men who worked for Gary were copied on the e-mail and a few had responded, offering more sarcastic fashion advice. Maggie sighed, but then cheered up when she realized that she would never have to deal with Gary again.

c.As she mused about how much better her life at QPI would be without Gary around, Maggie distractedly clicked through other windows that were open on Gary's computer.Gary had set up some kind of portal from his work machine to his home computer, so that Maggie found herself looking at Gary's personal photos of his family.On Gary's home computer, there was a window open to a web-site that Maggie had never seen before; it looked like a discussion group on Reddit called WallStreetBets.She saw that Gary had just posted some information about one of QPI's big customers, SpaceY, that recently purchased a large quantity of specialized lenses made for cameras that operate on satellites.Gary's post hinted that SpaceY's stock price was going to double because it had found a way to increase the resolution of its satellite images by at least one order of magnitude.Maggie immediately sent an e-mail to the SEC, telling them what she'd found and giving them details about Gary's Reddit username and his duties at QPI.

d.Maggie walked back to her office and created a first draft of a confirmation letter between QPI and DOA to formalize some purchasing transactions, as Nouv had requested.She sent an e-mail to Nouv's contact at DOA with the draft attached, which read: "Let's have a call to talk about how we should report this in our year-end financialsthat might affect how we structure the deal."

3.Larry Lotus had heard rumors about his impending termination from QPI the day before his meeting with Maggie.He didn't take the news well.He decided that he would leave a "legacy" at the company.In the 24 hours before his meeting with Maggie, Larry took the following actions:

a.QPI had been involved in a lawsuit with one of its distributors, Best Optics, Inc., for about a year.Larry had a friend who was a senior manager at Best Optics.When Larry arrived at work that day, he called his friend at Best Optics and told him: "QPI has been bluffing to try to get a good settlement.If you keep pressing your case, you're going to win big.I can give you some QPI internal documents that show you how weak QPI's position is, and they also include some secret technical details about how QPI makes its lenses so you could just start manufacturing them yourselves at Best Optics."Larry's friend at Best Optics was ecstatic and asked Larry to send him the materials as soon as possible. Larry sent the documents to his friend and then called his stockbroker and placed an order for 10,000 shares of Best Optics.

b.Larry had an "off-the-books" QPI account for "special marketing needs."He had built up cash in the account over time by falsifying expenses.Larry had initially planned to use the account to facilitate business in certain countries overseas where special "incentive" payments to government officers are necessary to get anything done, and he had used it for that purpose several times.Today, after his morning cup of coffee, Larry wrote a check for $30,000 (the remaining balance of the "off-the-books" account) to one of QPI's existing suppliers, who Larry thought would be willing to share the money with him.Larry signed the check and then mailed it to the supplier with a note describing it as a "performance bonus."Larry then called the supplier and left a voicemail, saying: "If you want to split the money with me, you can cash the check, but you cannot send me the money until 18 months from now or it will look suspicious.If you don't agree to split the money with me, don't cash the check and I'll just tell QPI it was a mistake."A few days later, the supplier cashed the check. But 18 months passed and the supplier never gave any money to Larry.Larry told the supplier: "We had a deal!"But the supplier still refused to pay.Larry filed suit 20 months after he left the initial voicemail, claiming breach of contract against the supplier and seeking $15,000 in damages.

c.After a busy morning, Larry went to lunch at a bar down the road from QPI's offices.He began to talk with the other patrons and had quite a few drinks.As it turned out, one of the people eating lunch at the bar was a regular customer of QPI.Larry loudly boasted that he could get anyone in the bar special pricing on QPI products "for this afternoon only."Although the customer could see that Larry was clearly drunk, Larry insisted on selling a shipment of 1,000 high-end fashion eyewear lenses to the customer at a steep discount.The customer wrote up a contract with all of the necessary information, signed it, and gave it to Larry.Larry signed the contract and ordered another drink. Larry continued drinking at the bar telling the bartender that he needed to stay to make additional sales for QPI.The bartender kept giving Larry drinks (some of them free) because Larry's antics were so entertaining that they were drawing a crowd of paying patrons.Larry's "sales activity" ended when Larry was dancing on the bar and fell on another patron, smashing the patron's head onto a stool and breaking two of his teeth.The patron scheduled an emergency appointment with a dentist and got his teeth repaired for $17,525.The patron e-mailed a copy of the bill to Larry the following week, asking to be reimbursed, and copying the Human Resources department at QPI and the owner of the bar.The patron's e-mail said: "If Larry does not pay, I hope one of your businesses will do the right thing and cover my dentist's bill."

Part 2 - Legal Memos

Instructions:wo "legal memos" to Nouv; of the two legal issues presented below.These memos are "legal" only because they are summaries of the general law that applies to each issue.Your memo should start with the "Issue" followed by the issue that Liddy has identified.You should then have a "Conclusion," describing your answer to the issue.You should then have a "Analysis/Reasoning," where you cite legal authorities and theories provided in the course materials and apply them to the facts to support your answer from the "Conclusion" section.

Liddy Lawless is QPI's General Counsel.Nouv has asked her to address the following issues so that he can be aware of the legal implications:

b.One of QPI's customers, SpaceZ, was secretly building a space-based gravitational wave detector to compete with NASA's Laser Interferometer Space Antenna (LISA).SpaceZ approached several companies and governments and, after they signed non-disclosure agreements about SpaceZ's secret project, SpaceZ offered to sell non-exclusive rights to the data from its soon-to-be-launched gravity-wave detector at a price of $30 million per customer.Four customers pre-paid for the rights to SpaceZ's gravity-wave data.Several other customers were interested, but were waiting to see whether SpaceZ's gravity-wave detector would begin operating before NASA's LISA.SpaceZ placed a special order from QPI for sixteen mirrors made of pure fused silica glass, which it planned to use in its gravity-wave detector.SpaceZ filled out QPI's form contract for special orders, which contains numerous boilerplate clauses.One of the clauses states: "All of QPI's lenses are sold 'as is.'" SpaceZ attached the precise specifications for the mirrors as an addendum to QPI's form contract, describing their physical properties.In response, QPI sent an invoice to SpaceZ for $35,700, which SpaceZ promptly paid.After receiving payment, SpaceZ sent QPI a receipt stating that the mirrors would be delivered within 14 days.When QPI delivered the mirrors 30 days later, SpaceZ discovered that they did not meet SpaceZ's specifications and could not be used in its gravity-wave detector.The next day, NASA announced that it was planning to launch its LISA in just two months.SpaceZ sent an e-mail to Nouv at QPI, demanding that QPI send replacement mirrors as soon as possible, explaining SpaceZ's intended use for the mirrors, and begging Nouv to keep SpaceZ's project a secret.Nouv replied to the e-mail, stating: "All of our lenses are sold 'as is.'We have never used our mirrors for gravity-wave detection, and make no warranties about their suitability for that purpose.NASA publicly stated that it purchased similar mirrors from our competitor, Dependable Optics Associates, Inc.QPI lacks the technical expertise to compete with DOA in this new, emerging market for gravity-wave detectors.We will not be sending any replacement mirrors."SpaceZ promptly sued QPI for breach of contract.Six months later, while SpaceZ and QPI were busy filing discovery motions, NASA successfully launched LISA, making any and all of SpaceZ's future data on gravity waves worthless. Issue: Assuming that SpaceZ prevails in the lawsuit, what damages will QPI be required to pay to SpaceZ?