Bugusa, Inc., Worksheet

University of Phoenix Material

BUGusa, Inc., Worksheet

Use the scenarios in the Bugusa, Inc., link located on the student website to answer the following questions.

Scenario: WIRETIME, Inc., Advertisement Altrese Has WIRETIME, Inc., committed any torts? If so, explain. WIRETIME, Inc. (WIRETIME) has committed trade libel. WIRETIME’s advertisement satisfies the three conditions of trade libel as defined by our text (Melvin, 2011, p.212): 1. Clear and specific reference to the disparaged product. WIRETIME makes defamatory statements about a specific company [BUGusa (BUG)] as well as to the specific product that BUG manufactures (BUG’s electronic recording devices). 2. Disparaging statement made with either knowledge that the statement was false or reckless disregard for the truth. WIRETIME’s statement that BUG’s electronic recording devices are low quality and do not work reliably for longer than one month is reckless disregard for the truth. We have no proof referenced in this scenario ascertaining the truthfulness of WIRETIME’s statement, but we can demonstrate that they published this statement with malice, or reckless disregard for the truth, with the intent of making BUG’s customers believe that BUG manufactures a low quality, unreliable product, thus driving away BUG’s customers and influencing them to use WIRETIME’s product as an alternative.

3. Communicated to a third party. By advertising the disparaging statement, WIRETIME communicated to a third party, the public, thus satisfying the third condition of trade libel.

Scenario: WIRETIME, Inc. (Janet) Fay Has WIRETIME, Inc. committed any torts? If so, explain. 1. Non compete tort was committed in this situation because WIRETIME completely overlooked the fact that Janet is in a contract with BUGusa that says Janet is not to work for any company that is the competitor of BUGusa

2. WIRETIME continuously offered more benefits to Janet until she decided to go against what she already agreed to with BUGusa for WIRETIME as an employer.

Scenario: WIRETIME, Inc. (Steve and Walter) Fay Discuss any liability BUGusa, Inc., may have for Walter’s actions. 1. BUGusa can face liability for the actions of Walter just for the fact that Walter no right or real authority to pull Steven to the side for anything. 2. If the situation would have turned into a bad situation only Walter and Bug usa would be responsible for the actions of Walter which could put BUGusa in legal trouble and that alone can interfere with BUGusa as a company.

Scenario: BUGusa, Inc., Plant Parking Lot Jacob Detter What defenses may be available to BUGusa, Inc.? Explain your answer. 1. BUGusa has been negligent in their security provided for employees and other individuals who were conducting business with the company. They are guilty of negligence as defined by No General Duty to Act because of nonfeasance based upon their special relationships to the employees and vendors being invitees. They were obligated to warn employees and vendors, as well as provide protection for them while on company property which was a breach of duty. 2. The employees that were robbed could be addressed using an assumption of risk defense. The employees are aware that there have been issues in the parking lot, and therefore should be watching out for one another by leaving in groups instead of individually. 3. BUGusa could try to use a comparative negligence defense with regards to the vendors that have been robbed. It may be possible to prove that if the vendor had stayed in his/her truck with the doors locked, or parked the truck closer to the docks that they would not have had an issue. However, a defense in this instance may be particularly difficult to stand on, and a settlement may be a better way to handle the vendor claims. 4. BUGusa needs to address this issue by providing a security guard assigned to the parking lot, or by fixing all lights, install additional lighting, as well as implement a complete security camera system.

Scenario: BUGusa, Inc. (Randy and Brian) What defenses may be available to BUGusa, Inc.? Explain your answer.

Scenario: BUGusa, Inc. (Sally) Altrese
Sally may have a successful case against BUGusa, Inc., for what torts? Explain your answer.

Sally may have a successful case against BUG for negligence. Per Melvin, under the MacPherson rule, set by MacPherson v. Buick, 111 N.E. 1050 (N.Y. 1916),” one who negligently manufacturers a product is liable for any injuries to persons (and, in some limited cases, property) proximately caused by the negligence” (Melvin, 2011, p. 226). BUG chose to eliminate the insulator from the design of the old product to save on production cost. But for the missing insulator, the recorder would not have short-circuited and Sally would not have been injured; BUG is negligent under proximity of cause. BUG is a designer, manufacturer, and seller of its electronic recording devices. As a manufacturer, BUG has a duty of care regarding proper design, manufacturing, testing, inspection, and shipping (Melvin, 2011).

Sally may also have a successful case for strict products liability under the Restatement (Second) of Torts section 402A. Sally’s scenario meets all elements of strict liability:

1. BUG is a commercial seller regularly engaged in selling its own product. 2. BUG’s original product is defective as there was foreseeable risk (short-circuiting) that would have been avoided through alternate design. Because BUG chose not to include the insulator that would have prevented short-circuiting in its older model due to production costs, the product is defective in design. 3. This scenario meets none of the strict product liability defenses. The product did not undergo substantial change prior to reaching the end user, and Sally did not misuse the product. Additionally, neither Sally nor the Shady Town Police assumed risk, because there is no indication that either party was aware of the risk, and continued to use the device for their own benefit. Even though the police department has not yet purchased the newer model, there is no indication that BUG notified of the danger inherent in the original model, through a product recall of the old model or other means of notification.

REFERENCES Melvin, S. P. (2011). The Legal Environment of Business a Managerial Approach: Theory to Practice. Retrieved from The University of Phoenix eBook Collection database.

References: Melvin, S. P. (2011). The Legal Environment of Business a Managerial Approach: Theory to Practice. Retrieved from The University of Phoenix eBook Collection database.