Exam 1

Houston PMBA
Freeman School of Business
Tulane University
Fall 2015

Each question is worth 25 points. Please fully explain each answer by

properly supporting your answer with either the appropriate ethical standard
or legal standard.
Please send the Word document and save it using your last name. Please
reference the email Houston PMBA.
Good luck and if you have any questions, please either email me or give me a
call at (504) 914-1648.
1. Please read the articles below:
http://www.bloomberg.com/bw/articles/2014-07-24/blue-buffalo-vs-dot-purinain-dog-food-fight-over-nutrition-claims
http://www.stltoday.com/business/local/what-s-behind-purina-s-big-moneyfight-with-blue/article_7e20a22d-9b58-5a28-9833-604135954533.html (you
have to answer the survey to view the article)
http://www.scribd.com/doc/222338993/Purina-Complaint-Against-Blue-Buffalo
After you read the above materials, using the theory of utilitarianism and
Ethical Decision Making Model discussed in class (see PowerPoint slide
13 from Weekend 1), is it ethical for Purina to use the law to wage a
competitive challenge or should the company simply compete on the
merits of its product?

2. Given the business that your team formed in Texas, suppose a national
company that was incorporated in Delaware sued each owner personally and
your business entity claiming that your team infringed upon their trademark
and tradename because the name your team selected was deceptively
similar to the national companys name. Please respond to the following
questions:
a. Does the national company have standing to sue?
b. What court or courts have jurisdiction?
c. What is the proper venue for the lawsuit?
d. What type of remedy would the national company seek, a
remedy in law or a remedy in equity or both?
e. You should assume for the purposes of this question that the
national company prevails in the lawsuit, and as a
consequence, the Texas Secretary of State revokes your
business entity status, that is, the firm that your team created
is neither an LLC nor a corporation (three groups formed LLC
and one group formed a corporation), as the case may be.
What type of business entity is your firm now?
f. For your specific business entity, what implications does the
change in entity status have for the contract your firm entered
into this past Saturday? For example, is the contract
enforceable; does it change any of the liabilities, etc.?

3. Please review the following articles:

http://www.nytimes.com/2015/06/18/business/uber-contests-california-laborruling-that-says-drivers-should-be-employees.html?_r=0
http://uberlawsuit.com/
http://www.huffingtonpost.com/2015/06/17/uber-independentcontractors_n_7604366.html
a. Are Uber drivers agents of Uber?
b. Using the legal standard that we discussed in class, please
determine whether Uber drivers are either independent
contractors or employees.
c. Additionally, the lawsuit over independent contractor status
also challenges Ubers practice of telling passengers that
the gratuity is included and not to tip the drivers, even
though the drivers are not getting the gratuity, is that
legal? What law would control the gratuity issues?
d. If Uber does not prevail, what legal implications would the
change from independent contractor status to employee
status have on Umber?

4. Please read the following set of facts:

The plaintiff was employed by defendant as a vice president. Plaintiff filed
suit against her employer. Plaintiff alleges that she was terminated from her
employment because a disability, alcoholism. She also claims defendants
violated the anti-discrimination provisions under state law denying her
request to attend counseling sessions and Alcoholic Anonymous meetings,
which she asserts was a reasonable accommodation to maintain her sobriety
and avoid a relapse of her alcoholism, a recognized disability, under state
law.
Plaintiff appeals from judgement dismissing her cause of action and
remanding the matter to binding arbitration.
In May 2011, the defendant hired plaintiff to serve in the position of vice
president. In July 2012, approximately fourteen months after she was first
hired, defendant promoted plaintiff to the position of senior vice president.
Plaintiff claims her superiors complimented her professional performance and
work ethic.
In support of their motion to remand this matter for arbitration, defendants
submitted to the trial court a certification from defendants vice president
human resources that attested to the fact the Company, in January 2012,
adopted an employee handbook. All employees were required to attest
they had received a copy of this handbook. Defendants human resources
manager submitted a certification to the trial court attesting that plaintiff
electronically acknowledged receipt of the handbook in response to
defendants email transmitting the handbook as an attachment.
A hardcopy copy of the email provided as part of the appellate record shows
plaintiff's name as part of a long list of defendants employees who, on
January 13, 2012 at 7:49 a.m., received the following email message from
human resources:
The Human Resources Team is ... pleased to now provide you with the
Employee Handbook for your reference and review.
This handbook contains information about the Companys employment
policies and practices and all employees are required to read the
handbook. Please take the time to go through the handbook and sign
in acknowledgement of your review.
Once you open the handbook document ... Below this you will see ... I
certify that I have read the policy above ... Check the box to the left of
this statement.

Defendants have also provided a computer print-out indicating that on

January 13, 2012 at 12:21 p.m., plaintiff acknowledged she had received and
reviewed the employee handbook.
The handbook's table of contents lists twenty-seven separate topics or policy
statements. For example, under the heading Compliance (on page six of
the handbook), there were categories listing Equal Employment Opportunity,
Harassment and Discrimination, Reporting Procedures, Retaliation is
prohibited, Code of Conduct, Maiden Ethics Hotline, and other similar areas
regulated by law. Under the heading Time Off (on page twelve of the
handbook), there were categories listing Holidays, Paid Time Off, Family and
Medical Leave ... Jury Duty/Witness, Time Off for Voting and similar areas
concerning absence from the workplace.
On the first page of the handbook, before the Table of Contents, and before
the Welcome Message, is the following statement:
Disclaimer
This handbook contains information about the employment policies
and practices of the Company. Each employee is expected to read this
handbook carefully as it is a valuable reference for understanding his
or her job. The policies outlined in this handbook should be regarded as
management guidelines only which in a developing business will
require changes from time to time. The Company retains the right to
make decisions involving employment as needed in order to conduct
its work in a manner that is beneficial to the employees and the
Company. This handbook supersedes and replaces any and all prior
handbooks and inconsistent verbal or written policy statements.
Except for the policy of at-will employment, which can only be changed
by the CEO in writing, the Company reserves the right to revise, delete,
or add to the provisions of this handbook. All such revisions, deletions
or additions will be in writing and communicated to all employees. No
oral statements or representations can change the provisions of the
handbook.
The provisions of the handbook are not intended to create contractual
obligations with respect to any matters it covers. Nor is this handbook
intended to create a contract guaranteeing that employees will be
employed for any specific time period.
THE COMPANY IS AN ATWILL EMPLOYER. THIS MEANS THAT
REGARDLESS OF ANY PROVISION IN THIS HANDBOOK, EITHER
THE EMPLOYEE OR MAIDEN RE MAY TERMINATE THE
EMPLOYMENT RELATIONSHIP AT ANY TIME, FOR ANY REASON,
WITH OR WITHOUT CAUSE OR NOTICE, UNLESS PROHIBITED BY
LAW. NOTHING IN THIS HANDBOOK OR IN ANY DOCUMENT OR
STATEMENT, WRITTEN OR ORAL, SHALL LIMIT THE RIGHT TO
TERMINATE EMPLOYMENT AT WILL. NO OFFICER, EMPLOYEE OR
REPREHENSIVE OF MAIDEN RE IS AUTHORIZED TO ENTER INTO

AN AGREEMENTEXPRESS OR IMPLIEDWITH ANY EMPLOYEE

FOR EMPLOYMENT OTHER THAN ATWILL.

The last page of the handbook contains an Acknowledgement form, which

includes the following additional disclaimer:
By signing below, you acknowledge that you have read and understand
the policies outlined in this Employee Handbook. You agree to comply
with the policies contained in this Handbook and to read and
understand any revisions to it and be bound by them. You understand
this Handbook is intended only as a general reference and is not
intended to cover every situation that may arise during your
employment. This handbook is not a full statement of company policy.
Any questions regarding this Handbook can be discussed with Human
Resources.
You acknowledge that this Handbook is not intended to create, nor
shall be construed as creating, any express or implied contract of
employment for a definite or specific period of time between you and
Maiden Re or to otherwise create express or implied legally enforceable
contractual obligations on the part of Maiden Re concerning any terms,
conditions, or privileges of employment.
The arbitration clause at issue does not appear until page twentyseven of this twenty-nine-page handbook. It is contained under the
section entitled Company Guidelines, and it reads as follows:
Arbitration; Choice of Law
Any controversy or claim arising out of or relating to the employment
relationship created between the employer and employee , including
all topics covered in this Employee Handbook, and interpretation of this
Handbook, or any alleged breach of it, shall be settled by arbitration in
accordance with the Arbitration Rules of the American Arbitration
Association, with such arbitration to take place AT THE companys
office with an agreed upon arbitrator. If the parties cannot agree on an
arbitrator, a court of competent jurisdiction shall appoint an arbitrator
at the request of either party. Although the parties shall initially bear
the cost of arbitration equally, the prevailing party, if any as
determined by the arbitrator at the request of the parties which is
hereby deemed made, shall be entitled to reimbursement for its share
of costs and reasonable attorney's fees, as well as interest at the
statutory rate. For individuals that do not live in the vicinity of the
County of Burlington in the State of New Jersey, the arbitrator may
determine whether the cost of attending the arbitration is overly
burdensome on the individual due to necessity of travel and may order
that Maiden Re reimburse the individual for necessary and reasonable

travel related expenses. Judgment upon the award rendered by the

arbitrator may be entered in any court having jurisdiction thereof. The
determination of the arbitrator in such proceeding shall be final,
binding, and non-appealable.
On August 1, 2013, plaintiff and defendant, thought its President, had a
conversation in which they discussed plaintiff's alcoholism. In her pleading,
plaintiff characterized this encounter as a particularly vulnerable experience.
Plaintiff claims she revealed to the President that she had completed a detox
program and was seeing a counselor the following Monday, August 5, 2013,
to form a long term plan for [her] treatment and recovery for her disability.
Plaintiff emphatically states that she made it very clear to the defendant
that she needed an accommodation for her disability as she needed to get
into a residential rehabilitation setting for her treatment and recovery as soon
as possible.
In defendants' responsive pleading, defendant characterized this encounter
with plaintiff as a discussion about plaintiff's problem with alcohol.
Defendants denied the rest of plaintiff's claims.
On August 6, 2013, defendants vice president of human resources, and a
human resources representative, informed plaintiff that her employment at
the Company had been terminated. The defendant did not provided plaintiff
with an explanation or justification for her termination. On September 16,
2013, plaintiff filed this complaint alleging unlawful discrimination state law.
Defendants filed their responsive pleading on November 26, 2013, together
with a motion seeking to dismiss the action and remand the matter to
arbitration.
The trial court granted defendants' motion on January 30, 2014.
You are the judge on the appellate court. Should you affirm or
reverse the lower court ruling? Your decision should be based on
contract law and the law surrounding arbitration.