The Legal And Ethical Environment Of Business 2nd Edition Gerald R. Ferrera, Mystica M. Alexander, William P. Wiggins, Cheryl Kirschner, Jonathan J. Darrow - Solutions

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An article by Professor Dodd in which he asks, “For whom are corporate managers trustees?” How would you respond to this question and why?
Madison Corporation sold tractors to Bartlett Corporation. Jessica owns 100 percent of the outstanding shares of Bartlett and serves as the company’s CEO. Six months ago, Madison initiated a breach of contract action against Bartlett because Bartlett failed to pay $$325,000$ to Madison, the
The text notes that some trademarks can be characterized as “stronger” than others, based on the level of distinctiveness. What are the four categories of trademarks, within the trademark distinctiveness continuum, mentioned in the text? Think of examples of trademarks that you know and provide
Bayer, a global pharmaceutical company based in Germany, holds patents in a number of countries on sorafenib (Nexavar), a drug used to treat certain types of cancer. One of these is an Indian patent (Indian Patent No. 215758), which provides Bayer with certain rights to exclude others from making
Do you think it is right or fair for some countries to have strong anti-bribery laws while other countries accept bribery “as a way of doing business”?
Does size matter? Warehouse clubs such as Costco, BJ’s, and Sam’s Club employ a strategy that includes large product sizes with low per unit costs. Suppose a supplier, such as Clorox, decides to sell super-sized versions of its products to one or more of these clubs, while offering only the
Which parties have considerable freedom to contract, although the freedom to contract is restrained by certain legal parameters. What are some examples of how expansive the law is in allowing freedom to contract? What are some examples of the restraints on this freedom?
Berkley Corp. wanted to buy 1,000 customized umbrellas imprinted with their logo to use for promotional purposes. It planned to use 250 of the umbrellas for an event scheduled for early February 2012 and to keep the remainder for future distribution to employees and customers. Berkley explained its
Recall the facts in Leonard v. Pepsico Had this been a contract, would it have been subject to the Statute of Frauds?
When a new health club opens, the owners offer a discount to the first 100 members who enter into a five-year contract. The fee is $$2,400$ annually for the first five years, prepaid, regardless of any fee increases throughout that period. Later, the health club alleges it faces an economic
John J. Williams began working at Delaware Elevator as a branch sales manager in late 2004. The company manufactures components for elevators and installs and repairs elevators. It employs 175 people in Maryland, Virginia, Delaware, New Jersey, and Pennsylvania. Williams was based in Wilmington,
Creusot-Loire, a French company, was the project engineer for the construction of ammonia plants in former Yugoslavia and Syria. Creusot-Loire contracted with Coppus Engineering for the purchase of burners that were capable of continuous operation using heavy fuel oil with combustion air preheated
December 2007. When she joined, she signed a membership agreement that had a release of liability that stated: “24 Hour. will not be liable for any injury, including, without limitation, personal, bodily, or mental injury, economic loss or any damage to you…resulting from the negligence of 24
Kemesia Boota Ward signed a contract on February 17, 2010, to hold her wedding reception at the Deauville Hotel on July 9, 2010. (The wedding ceremony was being held elsewhere.) Renting the ballroom space alone costs $$15,000;$ however, Kemesia chose to enter a “food and beverage contract,”
Zapata, a Texas company, entered into a contract for Unterweser, a German company, to tow an oil-drilling rig from Louisiana to Italy. The contract stated, “Any dispute arising must be treated before the London Court of Justice.” While Unterweser was towing the rig in the middle of the Gulf of
Which of the following is a sale of goods and therefore is covered by Article 2 of the Uniform Commercial Code?A. Development, implementation, hosting, and operation of sophisticated computing services that would run on Plaintiff’s computer hardware, but that are located at Defendant’s
Aangi sends Anil a purchase order stating that only her terms apply and that in the event of a dispute between the parties in connection with the transaction, the dispute will be submitted to arbitration. Anil replies with a confirmation form that indicates that only his terms will apply and that
Online purchases are commonly governed by a sales contract between the online merchant and the consumer in the “terms of use” found as a link on the seller’s home page. Often, purchasers are informed that using the site or ordering merchandise constitutes acceptance of the terms and
The results of the knockout rule may seem unsatisfactory because potentially, neither party is getting what he wants. What could an offeror do to prevent the knockout rule from “knocking out” any of his terms? What could the offeree do to prevent the knockout rule from knocking out any of his
VLM Food Trading International, Inc. was a Canadian agricultural supplier. Starting in June 2012, VLM sold frozen potatoes to Illinois Trading Company, an Illinois produce distributor, through nine separate transactions without any difficulties. Each time, “Illinois Trading sent a purchase order
Plaintiffs operated a concession foods business called Festival Foods that provided food services at carnivals and festivals. The tangible assets of the business included a truck and servicing trailer, refrigerators, freezers, roasters, chairs and tables, fountain service, signs, and lighting
Papa John’s International Inc., a large pizza chain, launched an advertising campaign with the new slogan, “Better Ingredients. Better Pizza.” Papa John’s placed the slogan on millions of signs, shirts, menus, pizza boxes, and napkins and used it in radio, television, and print
Over the course of about six years, Hanwha Corp., a Korean company, entered into 20 separate contracts to purchase petrochemicals from Cedar Petrochemicals, Inc. While negotiating for the twenty-first contract, Hanwha sent a bid, Cedar accepted it and included a provision for NY law to govern.
A used car dealer sold an automobile to a customer (Robert) on an installment basis. The installment sales contract calls for Robert to make monthly payments of principal and interest. The contract also provides the dealer with a certificate of title, which gives the dealer a lien on the property.
Dr. Wayside works at a local clinic as a general practitioner. Because she has significant unsecured debt, Dr. Wayside decided to petition the United States Bankruptcy Court for relief under Chapter 7 of the Bankruptcy Code. The court appointed a trustee who, upon review of the petition, filed a
Hi-Cloud, Inc., is a start-up tech company. It is seeking a substantial line of credit from a federally insured commercial bank. Among other questions, the loan application requires disclosure of the compensation paid to company executives. Barbara, Hi-Cloud’s CEO, was drawing a salary of
Conway Crafters, LLC, negotiated two promissory notes with Gotham Bank. Conway secured the loans to help finance the construction of a new commercial building. Separate mortgages secured each note. The mortgage language instructed Conway to take “any action reasonably requested” by Gotham Bank
List and describe the factors a creditor may use when asking a court to set aside an alleged fraudulent transfer of property under the Uniform Fraudulent Transfer Act (UFTA).
Describe the similarities and dissimilarities among the following types of creditors: secured creditors, unsecured creditors, and preferred creditors.
Explain how letters of credit protect sellers in overseas sales of goods transactions. Explain how they protect buyers in overseas sales of goods transactions.
Richard Foust worked as a project manager at San Jose Construction, Inc. (SJC). During the first part of 2004, he was managing 18 different projects. Foust grew unhappy with his employment situation at SJC and spoke with Richard Furtado, the CEO of South Bay Construction Company (South Bay), about
Forest Street Construction Corporation (Forest Street) employs Robert on a full-time basis to drive one of its dump trucks to various Forest Street construction sites. Robert has worked for Forest Street as a truck driver for the past three years. On June 24th of this year, Robert was scheduled to
Veronica’s expense report was reviewed by her company, and she was accused of taking her best friend on a business conference to Paris and charging all expenses for both of them on a company credit card. The company fired Veronica for this dishonest and unethical behavior. Veronica admitted it
Jack L. Hargrove is president and majority shareholder of Jack L. Hargrove Builders, Inc. (Hargrove). Gerald A. Heinz is president and majority shareholder of Gerill Corporation. After engaging in a series of preliminary discussions, Heinz and Hargrove decided to form a joint venture for the
List and describe the legal elements that comprise the unintentional tort of negligence. Provide an example of a negligence situation involving a personal injury. Provide another example of a negligence situation involving property damage.
E.I. DuPont de Nemours & Company (DuPont) manufactured and sold Teflon. The plaintiff, F&F, purchased Teflon from DuPont and used it as the primary ingredient in a product (Tufoil) it manufactured and distributed as a motor oil additive. The label on Tufoil listed Teflon as a primary ingredient.
Describe and illustrate the following four types of damages:■ Nominal■ Actual■ General■ Punitive
Twenty-two Argentinians initiated a lawsuit against DaimlerChrysler Aktiengesellschaft (DCAG). In its complaint, the plaintiffs stated that a subsidiary of DCAG, Mercedes-Benz Argentina (MBA), collaborated with Argentinian security forces to kidnap, detain, torture, and kill them and their
Krista was a passenger in a rented van. She sustained injuries when the driver of the van slammed into a tree after the van’s brakes failed. The driver of the van was not an authorized driver pursuant to the rental agreement with the rental company. The driver’s brother-in-law signed the rental
sounds coming from the north side of her three-story house. Toward the end of the second day, she examined the exterior of her house and noticed two large holes located near the roof. To inspect the holes more closely, Carmella used a new extensionstyle ladder that she purchased recently at a local
Sarah owns a self-driving car. She has been using the car for about two months without experiencing any problems. Recently, however, she was confronted with the following dilemma. As her car started to descend a steep hill, she noticed that a school bus filled with children was stopped in the
Describe and illustrate the differences among design defects, manufacturing defects, inadequate warnings and labels (marketing defects), and breach of express and implied warranties.
James was driving a vehicle manufactured by a major automobile manufacturer. Accompanying him were his wife and two children. James accidently drove over a curb and crashed into the concrete base of a light pole while traveling at a speed of 25 miles per hour. Prior to the crash, James did not
a. Describe how an express warranty is created.b. Describe how an implied warranty of merchantability is created.c. Describe how an implied warrant of fitness for a particular purpose is created.
Brian worked as a painter for a major U.S. corporation. Over a period of nearly a decade, he was responsible for painting different aspects of the corporation’s plant, including the floors, walls, and ceilings. A number of years after leaving this job, Brian developed a life-threatening form of
What are the essential elements of the Product Liability Directive of the European Union?
Edward Entrepreneur has an idea for a new business venture. He has designed an electronic gizmo, the Wonder Cleaner, to assist with routine household chores. Edward wants to set up a corporation to manufacture and sell this product in the United States and abroad. He is concerned about
In March 1979 one of the worst nuclear accidents in the United States occurred at the Three Mile Island nuclear plant in Pennsylvania. One of the nuclear reactors (Unit 2) at the plant had a partial meltdown and released small amounts of radioactive iodine and radioactive gases into the
Arco, Inc. is a small company that installs and repairs home and commercial heating and air-conditioning units. It has 75 employees and recently started selling its stock to extended family, its employees, and friends. The company has never issued dividends to the stockholders. From its outset Arco
Research sustainability efforts that have been taken by colleges and universities. List three measures your school (or any school in your state) has enacted to address this concern.
The amount of wind power produced through wind turbines steadily increases year after year, at a growth rate of about 25 percent. These wind turbines can be as tall as a twenty story building and have long, sharp blades. Wind farms have been found to kill thousands of birds annually, including
Hi Tech Corporation provides customers with access to the latest advancements in technology and software. Hi Tech replaces employee workstation computers every three years. Printers are replaced every five years. The High Tech board of directors believes such actions are essential to ensuring the
At a historic UN Summit in September 2015, world leaders adopted the 2030 Agenda for Sustainable Development. This agenda contains 17 sustainable development goals to be implemented by countries over a 15-year period. Research this agenda. Read through the 17 goals. Explore one in depth and
It is estimated that air pollution is responsible for 1.1 million deaths annually in China. Heavy reliance on coal to fuel the production of electricity combined with rapid industrialization have contributed to China’s air pollution crisis. The problem has become so serious that China’s
Jose Medellin participated in the rape and murder of two teenage girls in Houston, Texas. He was arrested and read his Miranda rights, and he confessed. At the time, he was not informed that he could consult with Mexican diplomats. He was sentenced to death. Mexico successfully sued the United
How and why would a country give up any of its sovereign powers?
As you have seen in this chapter, international trade law is founded on the importance and benefits of removing trade barriers. However, WTO rules also recognize the need to restrain trade in certain circumstances. What do you suppose those reasons are? When is international cooperation in
OBB Personenverkehr (OBB), the Austrian state-owned railway, carries about 235 million passengers a year on routes within wholly owned by OBB Holding Group, which in turn, is wholly owned by the Austrian Federal Ministry of Transport, Innovation, and Technology. It is one of 30 railways throughout
The United States brought a lawsuit requesting forfeiture of a $$38.5$ million jet purchased by Teodoro Nguema Obiang Mangue (“Nguema”) because the government believed the jet had been purchased with funds derived from extortion, misappropriation, theft, and embezzlement. Nguema was
Could a contract be difficult to categorize as either public or private international law? What would such a contract look like?
How helpful is it that jurisdiction of the International Court of Justice is voluntary? Does this completely undermine the credibility or usefulness of the court? What are the advantages and disadvantages of voluntary versus compulsory jurisdiction? What is the purpose of allowing a country to
A. In 2015, the Canadian province of British Columbia enacted regulations applicable to the sale of wine. Only wine produced in British Columbia could be sold on grocery store shelves. Wine produced outside British Columbia could also be sold, but only in a “store within a store” section of the
Explain the purpose of state constituency statutes and how they might aid a corporation’s efforts to engage in socially conscious behavior.
Pharmaceutical Company manufactures one of the most widely used diabetes medicines in the United States and Asia. Recently, the Food and Drug Administration has received an increased number of complaints from consumers about the extensive longterm side effects they have started to experience as a
A friend has asked you for help. She is an entrepreneur and would like to start a company to pursue her dream of designing and selling a line of children’s toys. She has heard the term “stakeholder theory” and would like you to explain some practical steps she can take to apply stakeholder
What might account for the fact that, on average, the investor return provided by the firms of endearment exceeded that of the Standard and Poor’s and Dow Jones averages?
Choose one of the companies you regularly patronize (e.g., Facebook, the Gap, etc.). Using information contained on the company website along with news sources, assess the extent to which the company engages in socially responsible behavior. If a company is very active in this regard, you may
Critics of the new hybrid benefit corporation have suggested that benefit corporation laws are unnecessary because corporations are already permitted to operate with a corporate social responsibility purpose. Do you agree? Explain your response.
Explore the website of the UN Global Compact initiative, at https://www.unglobalcompact.org/. Click on the heading “Engage Locally,” and explore some of the companies in your part of the world that have pledged commitment to the Compact Principles.
Jalila owns and manages a small business (E Connections) that sells electronic connectors and network components. The following industries purchase products from E Connections:mechanical and plant engineering, broadcast and entertainment, and industrial electronics and telecommunications. Jalila
Tony is a sole proprietor who owns 40 cabs doing business in Chicago under the name of Tony’s Cabs. The company’s total net worth is over one million dollars and Tony has personal assets totaling $$800,000.$ Tony’s lawyer recently formed four corporations. Tony is the sole shareholder of
Planes-for-Rent, Inc., (PFR) leases airplanes. Dayton, LLC, is one of PFR’s customers. Dayton is a limited liability company with one member, Jacob, who is Dayton’s sole owner. Dayton and PFR executed a five-year contract that calls for PFR to make available to Dayton a certain model plane four
Describe the advantages and disadvantages of forming a limited liability company (LLC) versus a corporation.
White Mountain Corporation (WMC) sells computer components.It is a publicly traded corporation. William serves as WMC’s Chief Executive Officer (CEO). William owns 15 percent of WMC’s outstanding stock. Sarah owns 10 percent of WMC’s outstanding stock. WMC recently executed an employment
Explain the purpose, use, and limitations of a derivative shareholder action.
If you wanted to expand your business to include international customers and vendors, what factors would influence your decision?
Martin Alexander created a pilot script for a new television sitcom entitled Loony Ben. Beginning in March 2006, Alexander submitted copies of the script to agents, producers, directors, production companies, and television networks. In September 2009, the sitcom Modern Family debuted on ABC and
In 1997, Bernard Bilski and Rand Warsaw filed a patent application for a method of hedging risk in the field of commodities trading. In effect, the asserted invention was a method of protecting buyers from sudden spikes in the price of commodities, such as coal, by matching them with sellers who
Trade secret theft can cause significant harm to a business. At the same time, businesses sometimes intentionally suppress information that might harm sales if publicly known. Suppose an employee of a lithium battery manufacturer believes internal company data suggest that its batteries will
“Cheese Nips” in the cheese cracker snack market. In a 1998 joint promotion agreement with television network Nickelodeon, Nabisco planned to launch a new snack cracker product that combined three shapes of cheese crackers: (1) a “CatDog” shape(2) bones, and (3) fish, all of which were
Which two types of intellectual property potentially last indefinitely? For the remaining two types that do not last indefinitely, how long do they last? Which types of intellectual property, if any, can be renewed? In your opinion, should copyrights or patents last longer or shorter than they do
Acclaimed screenwriter and director Woody Allen directed Midnight in Paris, a 2011 film that is set in Paris, France. In the movie, one of the characters states, “The past is not dead.Actually, it’s not even past. You know who said that? Faulkner, and he was right.” In fact, William Faulkner,
Jonathan owns Bright Sky Financial Services, Inc. (Bright Sky). He holds a controlling interest in the company. Jonathan manages seven mutual funds for approximately 150 high-wealth clients. Jonathan is a registered broker and Bright Sky is registered with the Securities and Exchange Commission. In
Describe the SEC’s role in regulating securities transactions in the United States. Discuss the mission and purpose of the SEC.
Madison Corporation (Madison) along with Sarah, Madison’s chief executive officer (CEO), and James, Madison’s chief financial officer (CFO), engaged in a practice known as using“dummy assets” to inflate credit ratings associated with an upcoming offering. Madison arranged to offer a
In a complaint filed by the Securities and Exchange Commission (SEC) against Thomas P. Flanagan and Patrick T. Flanagan in the U.S. District Court Northern District of Illinois Eastern Division, the SEC made the following allegations:A. That Thomas P. Flanagan (“Flanagan”), a former partner and
Describe the major provisions of the Securities Act of 1933 and the Securities Exchange Act of 1934.
Sarah serves as Chief Executive Officer (CEO) for Biostate Corporation. Biostate is a pharmaceutical company that conducts research on the development of new cancer drugs. It has developed several successful drugs over the past 15 years. ASA is a new drug developed by Biostate, which recently
Based on the speech delivered by Michael Piwowar, Acting Chairman of the Securities and Exchange Commission, at The 27th International Institute for Securities Market Growth and Development, what do you believe he means by the concept of “do no harm”? How does it apply to the markets globally?
After quitting his job at Korn/Ferry, an executive search firm, David Nosal decided to start a competing business. To help get his new business off the ground, Mr. Nosal convinced some of his former coworkers at Korn/Ferry to use their employee credentials to log into the Korn/Ferry system and
Describe the differences between civil law and criminal law. What is the purpose of criminal law? What is the purpose of civil law?
a deontological philosopher, stated in “An Exposition of The Fundamental Principles of Jurisprudence as the Science of Right” that “Judicial Punishment can never be administered merely as a means for promoting another Good either with regard to the Criminal himself or to Civil Society, but
In May 2010, Coquina Investments, an investment firm based in Corpus Christi, Texas, brought a lawsuit against TD Bank alleging that through the fraudulent actions of its agents, TD Bank is responsible for Coquina’s loss of millions of dollars. At issue in the case is an elaborate Ponzi scheme
List, describe, and provide examples of the various defenses available to a defendant charged with a business crime.
Until recently, Seth worked for the Seaside Cruise Ship Line Corporation (Seaside) as an engineer. Seaside is a U.S. company based in Florida. For the past two years, Seth has been assigned to one of Seaside’s must luxurious cruise ships: The Kilimanjaro. During a cruise across the Atlantic
Consider the case of Berghuis v. During their hours of questioning Thompkins, do you believe the law enforcement officials violated Thompkins’s fifth amendment right against self-incrimination? Explain.
Anheuser-Busch, owner of the Budweiser and Bud Light brands, was once the largest brewer in the United States, with a nearly 50 percent market share and annual revenues of $$16$ billion. In 2008, a group of Missouri beer consumers filed suit under the Clayton Act to enjoin the acquisition of
In 2011, quarterbacks Tom Brady, Drew Brees, and Payton Manning, representing a class including current NFL players, claimed that a league-imposed lockout was a horizontal group boycott among competitors (the NFL teams) and a per se violation of Sherman Act §1. The lockout meant that athletes
In 1990, Spirit Airlines began as a small, low-fare passenger airline. By 1996 it had experienced modest success and had grown to include 11 planes and about 455 employees. In 1995 and 1996, it expanded its routes to include the Detroit- Philadelphia market, which was also served by Northwest
Selling at below-market prices is not the only means of putting a competitor out of business. A firm might also seek to hire individuals that have rare talents or skills, not for that firm’s own business need, but to deprive competitors of those employees’skills and thereby drive the

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The Legal And Ethical Environment Of Business 2nd Edition Gerald R. Ferrera, Mystica M. Alexander, William P. Wiggins, Cheryl Kirschner, Jonathan J. Darrow - Solutions

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