COB 318 BUSINESS LAW EXAM 2
QUESTIONS WITH 100% SOLVED
ANSWERS!!
, 1 of 37
Term
"Tying arrangement. John Sheridan owned a Marathon gas
station franchise. He sued Marathon Petroleum Co. under Section
1 of the Sherman Act and Section 3 of the Clayton Act, charging
it with
illegally tying the processing of credit- card sales to the gas station.
As a condition of obtaining a Marathon dealership, dealers had to
agree to let the franchisor process credit cards. They could not shop
around to see if credit-card processing could be obtained at a lower
price from another source. The district court dismissed the case for
failure to state a claim. Sheridan appealed. Is there a tying
arrangement? If so, does it violate the law?
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Yes. The major antitrust law being violated is the Sherman Act, Section 1. Allitron
and Donovan are engaged in interstate commerce, and the agreement to
divide marketing territories between them is a contract in restraint of trade.
The U.S.
Department of Justice could seek fines for up to $1 million for each corporation,
and the officers or directors responsible could be imprisoned for up to
three years. In addition, the Department of Justice could institute civil
proceedings to restrain this conduct.
An employee is one whose physical conduct is controlled, or subject to control,
by the employer. There are statutes applicable: social security, withholding
taxes, workers' compensation, unemployment compensation, workplace safety,
etc.
An independent contractor is a person who contracts with another to do
something for him, but is not controlled by the other nor subject to the
other's right to control with respect to his physical conduct in the
performance of the undertaking. He or she may or may not be an agent.
, Ramierez does qualify for benefits. Under the Family and Medical Leave Act,
Ramierez should never have been denied PTO to go see her sick father. She
properly notified her supervisor of the family emergency. Taking care of a sick
relative is a reasonable cause to leave work, therefore she qualifies for benefits.
Yes, there is a tying arrangement, but it is not illegal. To violate the law,
the seller of the tying product must have monopoly power. Marathon
Petroleum Company has no monopoly power in the retail gasoline market,
which is the tying product in this case. Marathon Petroleum Company has
about 4 percent of the U.S. market. It tied credit-card processing to that,
but it had no power in that market either.
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2 of 37
Definition
Trade secrets are business processes and information that are not
or cannot be patented, copyrighted, or trademarked. Trade secrets
consist of generally anything that makes an individual company
unique and that would have value to a competitor. The Uniform
Trade Secrets Act, the Economic Espionage Act, and the common
law offer trade secrets protection.
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What is meant by joint and several
liability? Why is this often
What is insider trading? Why is
considered to be a disadvantage of
it prohibited?
doing business as a general
partnership?
, What are trade secrets, and
What are the duties of corporate
what laws offer protection for
directors and officers?
this form of intellectual
property?
Don't know?
3 of 37
Term
LLC operation. After Hurricane Katrina, James Williford, Patricia
Mosser, Marquetta Smith, and Michael Floyd formed Bluewater
Logistics, LLC, to bid on construction contracts. Under Mississippi
law, every member of a member-managed LLC is entitled to
participate in managing the business. The operating agreement
provided for a "super majority" 75 percent vote to remove a
member "under any other circumstances that would jeopardize the
company status" as a contractor. After Bluewater had completed
more than $5 million in contracts, Smith told Williford that she,
Mosser, and Floyd were exercising their "super majority" vote to fire
him. No reason was provided. Williford sued Bluewater and the
other members. Did Smith, Mosser, and Floyd breach the state LLC
statute, their fiduciary duties, or the Bluewater operating
agreements?
Give this one a try later!
QUESTIONS WITH 100% SOLVED
ANSWERS!!
, 1 of 37
Term
"Tying arrangement. John Sheridan owned a Marathon gas
station franchise. He sued Marathon Petroleum Co. under Section
1 of the Sherman Act and Section 3 of the Clayton Act, charging
it with
illegally tying the processing of credit- card sales to the gas station.
As a condition of obtaining a Marathon dealership, dealers had to
agree to let the franchisor process credit cards. They could not shop
around to see if credit-card processing could be obtained at a lower
price from another source. The district court dismissed the case for
failure to state a claim. Sheridan appealed. Is there a tying
arrangement? If so, does it violate the law?
Give this one a try later!
Yes. The major antitrust law being violated is the Sherman Act, Section 1. Allitron
and Donovan are engaged in interstate commerce, and the agreement to
divide marketing territories between them is a contract in restraint of trade.
The U.S.
Department of Justice could seek fines for up to $1 million for each corporation,
and the officers or directors responsible could be imprisoned for up to
three years. In addition, the Department of Justice could institute civil
proceedings to restrain this conduct.
An employee is one whose physical conduct is controlled, or subject to control,
by the employer. There are statutes applicable: social security, withholding
taxes, workers' compensation, unemployment compensation, workplace safety,
etc.
An independent contractor is a person who contracts with another to do
something for him, but is not controlled by the other nor subject to the
other's right to control with respect to his physical conduct in the
performance of the undertaking. He or she may or may not be an agent.
, Ramierez does qualify for benefits. Under the Family and Medical Leave Act,
Ramierez should never have been denied PTO to go see her sick father. She
properly notified her supervisor of the family emergency. Taking care of a sick
relative is a reasonable cause to leave work, therefore she qualifies for benefits.
Yes, there is a tying arrangement, but it is not illegal. To violate the law,
the seller of the tying product must have monopoly power. Marathon
Petroleum Company has no monopoly power in the retail gasoline market,
which is the tying product in this case. Marathon Petroleum Company has
about 4 percent of the U.S. market. It tied credit-card processing to that,
but it had no power in that market either.
Don't know?
2 of 37
Definition
Trade secrets are business processes and information that are not
or cannot be patented, copyrighted, or trademarked. Trade secrets
consist of generally anything that makes an individual company
unique and that would have value to a competitor. The Uniform
Trade Secrets Act, the Economic Espionage Act, and the common
law offer trade secrets protection.
Give this one a try later!
What is meant by joint and several
liability? Why is this often
What is insider trading? Why is
considered to be a disadvantage of
it prohibited?
doing business as a general
partnership?
, What are trade secrets, and
What are the duties of corporate
what laws offer protection for
directors and officers?
this form of intellectual
property?
Don't know?
3 of 37
Term
LLC operation. After Hurricane Katrina, James Williford, Patricia
Mosser, Marquetta Smith, and Michael Floyd formed Bluewater
Logistics, LLC, to bid on construction contracts. Under Mississippi
law, every member of a member-managed LLC is entitled to
participate in managing the business. The operating agreement
provided for a "super majority" 75 percent vote to remove a
member "under any other circumstances that would jeopardize the
company status" as a contractor. After Bluewater had completed
more than $5 million in contracts, Smith told Williford that she,
Mosser, and Floyd were exercising their "super majority" vote to fire
him. No reason was provided. Williford sued Bluewater and the
other members. Did Smith, Mosser, and Floyd breach the state LLC
statute, their fiduciary duties, or the Bluewater operating
agreements?
Give this one a try later!
