Farmer Joe Andrews, who owned 350 acres of farm land, was approached by Ajax Oil Company that

QUESTION

1.
Farmer Joe
Andrews, who owned 350 acres of farm land, was approached by Ajax Oil Company
that offered to buy the front 30 acres of his land, which bordered on a
four-lane highway, so they could build a gasoline station. Ajax Oil asked Mr.
Andrews if he had complete ownership of the land, and he assured them he did.
The two parties negotiated on the price and terms of the land sale for several
days and finally agreed on a price of $60,000 for the 30 acres and Mr. Andrews
signed a Quit Claim Deed transferring ownership to Ajax Oil. Ajax Oil developed
the land and built the gasoline station with a typical small grocery store, and
a car wash. The gasoline station functioned well for the next eight years, and
was very profitable. The State Highway Department contacted Ajax Oil, and told
them the state had acquired the right to take the land 30 years ago for
expansion of the highway through a Special Warranty Deed from farmer James
Barnes, who had owned and operated the farm before Joe Andrews. The issue quickly
goes to court with the State Highway Department, Ajax Oil, farmer Joe Andrews,
and farmer Barnes’ Heirs, all parties to the legal activity. What issues are
involved here in regard transfer of right to land? Who do you think will
prevail? (Points : 30)

2.ABC
Computers is a manufacturer and seller of personal computers and tablets. ABC
entered into agreements with suppliers requiring that such suppliers not sell
ABC’s computers below ABC’s suggested minimum retail price and in return, ABC
would not sell its products at retail prices in the store owners’ territories.
ABC decided not to sell any more computers unless an additional software
package was purchased. A competitor informed the Office of the Attorney General
of this policy, asserting it was illegal. Additionally, the new model of ABC’s
computer has caught on fire, causing injuries to consumers. Explain what ABC
should do to protect consumers. Also consider whether there have been any
violations under the antitrust and related laws and the governmental agencies
involved in these types of cases.
(Points : 30)

3.Prior to the 1935 Case of “McPhearson v. Buick
Motors”, manufacturers had little or no liability exposure for malfunctions of
their products that lead to injuries or death to individuals from said product
failure. What was the specific problem associated with this new Buick
Automobile, and what two alternative legal claims did Buick Motors direct Mr.
MacPhearson to pursue as opposed to his claim against them? What specific legal
liability regarding manufactured products developed from this case, and what is
its lasting effect in today’s world of consumer products? (Points : 30)

4.A large old brick building is being torn-down
by a large well known contractor, and the bricks are just being thrown in a
ditch by the road, apparently for disposal. A builder of small brick buildings
on the outskirts of town notices two teenagers sitting in a large pickup truck,
eating lunch, and watching the bricks being thrown into the ditch. The builder
walks up to the teenagers and says, “if you guys will gather up those bricks
being thrown in the ditch, put them in your truck, and deliver to my
construction site at 1240 Oak Street, I will give you 6 cents a piece for the
bricks”. The teenagers just smile and keep on eating their lunch. The builder
leaves and goes back to 1240 Oak Street, where his crew is assembling a small
brick building. At 4:00 PM that afternoon, the two teenagers drive up to 1240
Oak Street with their pickup truck loaded with bricks. They go up to the
builder and say, “okay we are delivering 8,000 bricks, so at 6 cents per brick,
you owe us $480”. The builder laughs and says, “I don’t really need them, you
should just take them back and dump them in the ditch”. Do you think the
teenagers have a contractual claim against the builder that they can recover on
in court? How should they proceed? (Points : 30)

5.

Johnson Manufacturing is a publicly held corporation that burns coal to power
its plant. Johnson’s received notice today of an immediate rule change by the
EPA requiring all coal burning plants to reduce their emissions by 10%. Implementing
the technology to comply with this regulation would cost Johnson’s millions of
dollars and could put them out of business. The CEO knows that the current
emissions standards have been proven safe and acceptable but cannot find any
research supporting the new standard.

Identify
and apply an ethical theory from chapter 8 of our text that you think is
appropriate and explain how you would advise the CEO regarding whether or
not he should comply with the new standard. (15 points)
The CEO
is upset that no prior notice was given concerning this rule change. As
legal counsel for the company, the CEO has asked you to determine if it is
legal for the EPA (or any administrative agency) to issue an immediate
rule change. Explain why or why not. (15 points)
The CEO
wants to approach the EPA with an alternative way of reducing pollution.
He asks you if emission charges and/or marketable discharge permits would
be viable options. Explain how these could potentially reduce emissions
and evaluate whether or not one or both could be used instead of the
regulation the EPA passed. (15 points)
Several
years ago, the Board of Directors at the request of management voted
against complying with a previous EPA rule change. This decision ended up
costing the company $2 million in fines and penalties. Both management and
the board are considering not complying with today’s rule change. Apply
the business judgment rule as it relates to the board of directors and
management. Include their legal and ethical responsibilities in the
assessment. (15 points)

6.
The Federal Government’s prosecution and eventual
dissolution of the Standard Oil Trust under the 1890 Sherman Act before the
Supreme Court in 1911 was the dominate example of antirust litigation in this
country for almost 100 years. The only other Federal attack on a business as a
dominate Monopoly to approach the importance of the Standard Oil Trust case was
the United States v. Microsoft Corporation case, which was originally filed in
1999 by President Bill Clinton and his Attorney General Janet Reno. The
Microsoft Case was resolved at the U.S. Circuit Court of Appeals in 2001 by
President George W. Bush and Attorney General John Ashcroft. What was the
basis, Federal Statute, for the original complaint against Microsoft? What was
the basis of the specific complaint the Federal Government filed against
Microsoft? What was the final result of the case, and the lasting impact on the
software/computer industry? (Points : 30)

7. Given that only 12 percent of the Business Organizations
functioning in the United States are Corporations, what factors of business
characteristics and operations result in Corporations generating 89 percent of
business revenue? (Points : 30)

8. After Justin graduated from college, he was hired by one of
the largest ad agencies in the city. His first assignment involves working on
the Budget Burger account. Budget Burger is owned by the daughter of the
president of the ad agency (Mr. Johnson) and has three locations throughout the
city. Justin’s assignment was to design T-shirts with a catchy slogan to be
handed out for free at all Budget Burger locations to celebrate the grand
opening of Budget Burger’s fourth location. The T-shirts said “Done your way!”
Due to a lack of time, the normal approval process was skipped and the T-shirts
were printed and rushed to the Budget Burger locations. Over two thousand
T-shirts were handed out the day of the grand opening. The president of the ad
agency doesn’t have a chance to see the T-shirts until the end of the day when
he notices the customers wearing them. He is furious because their largest
account is Burger King and fires Justin on the spot, and calls the head of the
legal department to set up an emergency meeting. (Part 1) (10 points) Identify
and apply an ethical theory from chapter 8 of our text that you think the ad
agency should have applied to this situation with Justin. What should the ad
agency do next based upon your analysis? (Part 2) (10 points) Identify and
apply a theory of employment law the ad agency could use to justify firing
Justin. Do you think it would be successful? Why or why not? (Part 3) (10
points) Identify and apply an intellectual property law theory Burger King
could use if it decided to sue the ad agency. Would the theory you chose be
successful? Why or why not?(Points : 40)

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