Business Regulation

Topics: Tort, Defamation, Negligence Pages: 5 (1535 words) Published: December 3, 2012
Business Regulation Simulation
Torts can be purposeful or negligent, but ultimately result in some kind of damage. Within the business simulation from Harb, we could identify possible torts as a team. The torts we identified were: unsafe water causing leukemia, infliction of emotional distress, and the possibility of defamation of character. Many factors can contribute to the Enterprise Risk Management process; however, it is necessary to minimize the risks and organization encounters. The Enterprise Risk Management process is defined as, “The management of corporate or enterprise-wide risks and opportunities in one systematic, structured, and comprehensive framework using both a consistent methodology and terminology” (Harb, 2008, p. 4). The ERM process essentially helps an organization develop a better implementation process of planned projects and identifies potential areas of threat. Tort Violations

Tort law entitles injured persons to receive monetary compensation from those responsible for their injuries. Those injuries include pain and suffering, physical, emotional, economic, and reputational injuries as well as violations of privacy, property, or constitutional rights (Kreithen Baron & Carpey, 2012).

A lawsuit was filed in the case against Alumina Inc. in the Business Regulation Simulation. Kelly Bates claimed that the unsafe water caused her daughter’s leukemia. The five-year timeframe fit Kelly’s situation and she had a solid case against Alumina Inc. Alumina Inc. was being charged with an unintentional tort, known as negligence. To be successful in a negligence lawsuit, the plaintiff must prove that injury occurred as a direct result of negligence (Cheeseman, 2012). If the defendant’s act caused the plaintiff injury, the lawsuit could be damaging.

Another possible tort violation would be negligent infliction of emotional distress. This tort involves a bystander (Kelly Bates), who witnessed her daughter’s affliction with leukemia and was able to bring forth a lawsuit against Alumina Inc. Even though Kelly was not directly affected or injured, she can sue the negligent party for her own mental suffering (Cheeseman, 2012).

The lawsuit could have taken different directions. If Alumina Inc. had decided to investigate Kelly Bates and make false statements about her accusations and her character, the tort violation could have been defamation of character. Defamation of character is slandering another person or making false statements that could ruin a reputation. A false statement that appears in writing or other fixed medium is libel. The name for an oral defamatory statement is slander (Cheeseman, 2012).

The proposed tort violation to use would be negligent infliction of emotional distress. The case closely resembles this tort violation because the damage was not inflicted upon the plaintiff, but rather her daughter. The emotional distress caused Kelly to become desperate and in need of answers. The resolution was simple for her; file a lawsuit and rightfully give her daughter what she deserved. Settling the case with alternative dispute resolution was the best choice for both Alumina Inc. and Kelly Bates. Management Commitment

The first step in implementing an ERM process is to have the management commitment. The ERM team will work directly with the board of directors and leadership of an organization; therefore, their cooperation and commitment is essential to executing an ERM team, and the potential findings for the organization. When a leader is supportive of a process, he/she can help lower-levels of the organization understand the need and benefits of possessing a specific process. Harb explains that management should be committed in five different areas (understanding the process, being involved, encouraging, and setting the tone, governance, and building a culture (2008, p. 8)). Each area can help sustain an ERM implantation for an organization. For Alumina Inc. the entire organization...

References: Cheeseman, H.R. (2010). Business law: Legal environment, online commerce, business ethics, and international issues (7th ed.). Upper Saddle River, NJ: Pearson Prentice Hall.
Harb, Tony. (2008). 7 essential elements of ERM and the role of internal audit. [3-13] Retrieved from University of Phoenix eCampus website: Articles/Essential%20elements%20of%20ERM%20and%20role%20of%20%20Internal%20Audit.pdf
Kriethen, Baron & Carpey. (2012). Examples of Tort Violations Where it is Best to Hire a
Personal Injury Lawyer in Philadelphia. Retrieved from
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