Business Law
The author of this report has been asked to answer regarding several different legal and/or ethic cases or questions. Those cases/situations are Wrench LLC vs. Taco Bell, California & Hawaiian Sugar Company vs. Sun Ship Inc., the general legal cases and practice of cybersquatting and general ethics. While these cases are controversial and the topic of many scholarly conversations, the outcomes that should have happened are quite clear.
Regarding the Wrench LLC vs. Taco Bell case, it is clear that Taco Bell used the Wrench idea and just the idea that Chait/Day saying that they figured out the concept on their own was an obvious lie. Taco Bell did not act ethically as they took the idea offered to them by Wrench LLC and used as their own using Chait/Day as a proxy. Regarding whether Taco Bell entered an implied-in-fact contract, they really did. The reason this is fairly obvious is that they took the ideas and concepts offered by Wrench, considered it internally (with the knowledge and consent of Wrench LLC) and then used the idea in their advertising almost verbatim but while cutting out Wrench LLC from consideration for their (successful) idea. The fact that Wrench LLC and Taco Bell did not reach a verbal or written contract is of no consequence because everything else indicated that Wrench LLC offered the idea and Taco Bell ended up using it. Further, Taco Bell, in concert with Chait/Day, actively deceived and lied about whose idea it was. The idea of damages for Wrench is justified as it was their idea, Taco Bell realized a lot of profits from the idea and Taco Bell/Chait unquestionably lied about whose idea it was. As such, damages are called for. Further, the case law and concept of implied-in-fact contracts is necessary so that businesses and people do not take advantage of the fact that an explicit verbal or written contract is not in place (Nolo, 2014).
To be sure, the case between Taco Bell and Wrench was not cut and dried. Only the totality of the situation led to Taco Bell losing. Taco Bell had a point in that there was no official contract in writing (or even verbal, in many senses) and thus perhaps they felt no obligation to include Wrench LLC in the rewards of the advertising campaign. However, Wrench won the day because Taco Bell clearly, along with Chait, took the idea that Wrench created (or one VERY similar) and claimed it as their own and gave no credit for royalties to Wrench LLC. Further, Wrench and Taco Bell were indeed trading materials and information and this would imply a working relationship. They certainly were not coworkers and it is clear that Taco Bell was using Wrench's ideas, at least in part, to drum up an ad campaign. For Taco Bell and Chait to wedge out Wrench is not equitable or legally defendable. If Taco Bell and Wrench did not directly work together, Taco Bell and Chait would have a much stronger case but that is simply not the way it went down. Because of the work they clearly did together, there was indeed an implied contract between the two and Taco Bell clearly breached it.
Regarding the California & Hawaiian Sugar vs. Sun Ship case, it is clear that Sun Ship was on the wrong end of that case. However, the case was not clearly black and white. Reasons and concepts in Sun Ship's favor is whether the liquidated clause was reasonable based on the facts and figures involved, whether there was a public policy exception that negated all or part of the contract and whether California & Hawaiian (C&H) acted in good faith. However, the case in favor of C&H is much clearer. First, C&H's reason for applying the liquidated clause to the contract was quite clear given that sugar's harvest period is at its peak for only about half the year. Second, the liquidated clause of the contract was very specific in that it was a certain amount per day for each day past the deadline that the ship was not delivered. It was a certain amount of day and it was presumably based on actual damages that C&H would realize if the ship was not available due to alternate arrangements having to be made, presuming any were even available. Lastly, Sun Ship signed off on the contracting knowing full well what was expected and required them and then only reneged when the contract terms were violated by Sun Ship....
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