Running head: 7-2 FINAL- CASE STUDY ANALYSIS

7-2 Final- Case Study Analysis

Anthony Allen
BUS/206
July 31, 2016
Prof. Laycie Ewing

7-2 FINAL- CASE STUDY ANALYSIS

7-2 Final- Case Study Analysis

In the case of Novelty Now Inc., Funny Face, and Mr. Donald Margolin we have an issue of
jurisdiction in the case. Novelty Now Inc. manufactured a product that created and sold by
Funny Face, the product turned the victim Donald Margolin face blue.Mr. Margolin is suing the
manufacturer for damages, but a non FDA approved ingredient, PYR was added to the product
under the approval of Funny Face company.
Personam jurisdiction is also any lawsuit where a case is against an individual person, a
summons must be served and a complaint is given to the court jurisdiction to try the case.
Subject matter jurisdiction is the nature of the claim and is the court's power to hear these types
of cases. Federal courts take on cases such as bankruptcy, state against state disputes, U. S
disputes against anyone, and any issues of federal law. In a case of diversity of citizenship, this
could apply due to the fact that each party are in different states, but the damages limit may not
surpass $70k. Minimum contacts are contacts between a party and a state in order for the courts
of that state to assert power of a party within specific boundary. This ADR could work if the all
parties want a binding arbitrator because it keeps Novelty Now and Funny Face's misconduct as
a notation in the case and not made public, but if one party feels they are not compensated
equally, a trail will suffice.
Funny Face and Novelty Now should consider settlement conferences, where the sole
purpose of the meetings is to agree on an amount for the damages. Funny Face committed fraud
for the intentional deception for financial or personal gain. The company intentionally and
deliberately changed the recipe for their product with a non-FDA approved product.

7-2 FINAL- CASE STUDY ANALYSIS

In the case of Sam and the grocery chain, intent is when in this agreement serves a legal
relation between Sam and the grocery store. This goes into effect when and if Sam is able to
fulfill his part of the agreement and a legal starting point if cannot fill the order. With all intents
and purposes, Sam has agreed to an offer, shown intent, and considered and accepted an offer.
There is no formal contract between the two parties, but a unilateral contract can also be
admissible in court in case either wants to sue for breach of contract.
Sam also signed a rental contract that states all the rules and regulations related to this
type of contract. In this contract, Sam has the right privacy in his dwelling, the right to file
complaints about disturbances and repairs to his domicile. The other side of this is Sam is bound
by a rental agreement that states he has to create a suitable atmosphere for other tenants, pay his
rent on time, keeping the premises safe and free from hazards, and allowing the landlord 24-hour
access to his home, given a 24-hour notice. The landlord has the right to set a rent price, evict
tenants who breach the contract, in this case, Sam has breech and area of this contract.
The landlord violated the terms of the rental agreement by issuing an eviction notice
without first issuing a warning and not giving Sam reasonable time to resolve the issue stated on
the eviction notice. In this case, Sam can rebut this eviction either in court with a judge or
between legal counsel and the landlord.

In case study three, Arcadia Sport as a corporations will make them a more mobile, and
the double taxing them might cause them to move their operations elsewhere. Another downside
for Arcadia sports formation into corporation is the U.S. has had the highest corporate income
tax rate in the world, with a combined federal and state average of 39.2%. With this being said
most companies that are moderately successful would not want to deal with all the tax mess, so a

7-2 FINAL- CASE STUDY ANALYSIS

corporation I would be a good choice for this company. An LLC, in the eyes of the federal
government are not a separate tax entity, so the business itself is not taxed, but all federal income
taxes are passed on to the LLC's members and are paid through their personal income tax. In this
case with one member's bankruptcy, will hurt them tremendously, and with the possible lawsuit
looming I dont see the company able to afford to pay for damages to the customer.
Sole proprietorship is the most popular business entity because it is the easiest to form,
sole proprietorship is less complex and less expensive and demands less paperwork to start
compared to an LLC. To establish an LLC, you must form and register your LLC entity with the
applicable state agency, often the secretary of state's office. Setting up an LLC requires more
upfront time, money, and effort than a sole proprietorship so you'll have to factor that in when
deciding which entity is best for you. If your LLC has other members, you and your fellow
owners can pool together your resources and reach out to a broader network of potential business
contacts. It may be useful to have other LLC members so you may learn from their professional
experiences, share management and marketing duties, and draw additional funding from your
fellow LLC owners. On the other hand, an LLC is a separate legal entity and an LLC member is
normally not personally liable for the LLC's debts or legal liabilities. As an LLC owner, you may
still be personally liable for your own conduct or LLC loans in some cases.
In conclusion in the Jeb and Josh case, they have a partnership wherein they are using
each other's resources to create Arcadia Sports. Their partnership entitles each party to share to
profits and the losses. In partnerships, all owners are jointly and personally liable for any debts,
judgments or other liabilities of the business, so with the issue of the customer hurting herself,
both will be responsible for her medical bills, and any incurred cost.

7-2 FINAL- CASE STUDY ANALYSIS

Business Law to me is no different than criminal law, both can cause physical and
nonphysical damage to someone or thing, and both can show intent to do something good with
good intentions or the latter. Business Law is the basis to any businesses bylaws, so companies
should be held accountable for their actions.

7-2 FINAL- CASE STUDY ANALYSIS

References
Kubasek, N., Browne, N., & Giampetro-Meyer, A. (2011) Dynamic Business Law (2/e). New
York: The McGraw-Hill Companies. Retrieved July 15, 2016.
Quasi Contract. (n.d.) West's Encyclopedia of American Law, edition 2. (2008). Retrieved
July 14, 2016 from http://legal-dictionary.thefreedictionary.com/Quasi+Contract
Promissory Estoppel. (n.d.) West's Encyclopedia of American Law, edition 2. (2008).
Retrieved July 14, 2016 from http://legal-dictionary.thefreedictionary.com/Promissory+Estoppel
Gale encyclopedia of American law. (2011). Farmington Hills, MI: Gale/Cengage Learning.
Retrieve on July 15, 2016 from http://legaldictionary.thefreedictionary.com/Landlord+and+Tenant
Judicial Branch of California. (2016, June 30). ADR Types & Benefits. Retrieved from
http://www.courts.ca.gov/3074.htm