Subject: Business Law

CASE STUDY

Simon (marketing and sales) has been working in a general partnership (EcoPackaging) with Mary (engineer) and James (designer) for the last four years. The partners came together with the objective of introducing eco-friendly materials in the distribution of food products. Over the past two years they have been working on the design and manufacturing of an environmentally friendly six-pack holder; in the industry these are known as hi-cones or yokes. These bottle and can yokes are set to replace the plastic ones we are so used to seeing. The team has has invented bio-degradable / edible rings made from barley and wheat that marine life can eat should they end up in the sea. The product will be called WheatMe and will also be their trademark.

Although it takes time Simon manages to convince a number of beer manufacturers to start using the WheatMe holder for their six packs and consumer reaction is very positive and it enters into a one-year supply agreement with EcoPackaging. They have agreed to use the eco-friendly hi-cones in the delivery of all of their canned and bottled beer products.

As EcoPackaging starts to develop and sell more products that can be used in the distribution of drink and food products they are informed that there is another hi-cone on the market easily confused with that of EcoPackaging due to the similarity in the design. However, while the copy hi-cones are biodegradable (they degrade in 200 days) they are not edible.

• Read the case study below and answer the following questions:

1. EcoPackaging is contacted by a supplier of the material they use in the manufacture of the eco-friendly cones, informing them that they are being sued for the outstanding amount of 7,400 ordered by Mary over the past 5 years. When they started out the supplier who believed in what they were trying to achieve allowed them to pay half, with the understanding that it would be paid back within a five-year period. This period came to an end in December 2021.

   Who can the supplier sue? How would this be different if EcoPackaging were a private limited company?

2. Similarly James has invested, beyond his initial contribution, some 20,000 in products and storage space over the last two years. How does S.24 protect

   him regarding this?

3. Imagine that EcoPackaging could not afford to get patent protection, how could they protect the rights to their invention?

4. Imagine that 10 years have passed and Simon, Mary and James have incorporated a private limited company and now have over 50 employees.

   They are looking for new investors and are thinking about issuing preference shares. Why might this be a good option for them and the would-be

   shareholder? How might they entice employees to stay with the company?

5. As a limited company they are contacted by Water2Go. It is interested in establishing a joint venture (JV) with EcoPackaging.

   Outline what EcoPackaging should take into consideration when deciding whether or not to move forward with the JV.