You are on page 1of 9

Memorandum

To: Waldo Jenkins

From: Tiffany Lam

Date: February 19, 2018

RE: Brain Cellular Legal Analysis

As you requested, I reviewed the legal issues we previously discussed concerning Brain

Cellular. Below is my analysis and some recommendations regarding the issue.

Can we sue Manuela, Mind Mobile, and/or YouTube for the false claims Manuela has

made regarding you and Brain Cellular?

Manuela intentionally published false statements on a YouTube video regarding you and

Brain Cellular. Intentionally publishing false information that is harmful to another individual’s

reputation is considered defamation. There are two specific types of defamation – libel and

slander. Libel is a publication of defamatory statements in permanent form, while slander is a

spoken defamatory statement. Manuela committed both libel and slander. When Manuela posted

false statements on YouTube regarding your characteristics, she committed libel, since the video

is permanently on YouTube’s site. Manuela also committed slander by contacting Penelope

Marshal and repeating false statements about you. Since Manuela committed an intentional tort

against a person, you are able to sue her for defamation.

To sue Maneula (the defendant) for libel, there are certain aspects we would have to

prove. First, we would have to prove that Manuela disclosed the information on YouTube, where

people have access to the information. We would also have to prove that individuals understood

that what Manuela said was about you. The statement disclosed also has to be understood as

defamatory and Manuela had to have failed to use reasonable care to determine the truth about
the information. We would also have to prove that Manuela’s action caused general,

unquantifiable, damages. If we can prove these factors, we can sue Manuela for libel.

To claim slander, we would have to prove similar factors as libel. First, we would have to

prove Manuela made a false, defamatory statement about you to Penelope, which Penelope

understood to be regarding you. We would also have to prove that Manuela failed to use

reasonable care to determine the truth about the issue. Unlike libel, instead of proving general

damages, we would have to prove specific damages for slander, which would consist of the

$6,000,000 contract lost from the TurboTaxi deal. However, since it is likely that this act would

be addressed as slander per se, since Manuela’s statement is harmful. Therefore, proof of

damages is not required.

In addition to defaming you personally, Manuela also defamed Brain Mobiles product.

Intentionally defaming a business product is type of disparagement. In the video posted on

YouTube, Manuela claimed that Brain Cellular phones are poorly made and considered trash.

Since Manuela falsely discussed the quality of the phones, she committed disparagement.

Disparagement is a type of intentional tort. Therefore, Brain Cellular can sue Manuela for

violating disparagement.

Similar to proving defamation, there are factors we need to prove to claim disparagement.

To sue Manuela for disparagement, we would have to prove that the Manuela made a

disparaging, untrue statement about the Brain Mobile’s product or service to someone. In your

case, we would need to prove that Manuela contacted Penelope and defamed Brain Cellular. In

addition, we have to prove that Manuela knew that the statement was untrue and knew that

someone might act due to the facts in the statement, in our case, TurboTaxi. We would also need

to prove that the Brain Cellular suffered indirect harm because someone relied on the false
statements and the defendant’s actions was a factor that caused the Brain Mobile’s harm, which

we can prove since Penelope cancelled the contract.

Manuela also intentionally interfered with a contract, committing an intentional tort

against economic interests. Manuela knowingly and successfully took action to convince a third

party to breach a valid contract. Brain Cellular had a contract with TurboTaxi, which Manuela

interfered with by calling Penelope and defaming you and the company. Since Penelope

cancelled the contract due to Manuela’s actions, she interfered with a contract. Therefore, Brain

Cellular can also sue Manuela for intentional interference with a contract. To prove that

Manuela’s action led to a breach of contract, we would have to prove that Manuela knew about

the contract and she intended to disrupt the contract. We would also have to prove that

Manuela’s action prevented performance and Brain Cellular was harmed by Manuela’s doings.

Usually, both the employee and the employer can be sued for a tort that an employee

committed. Under the doctrine, respondeat superior, which is mainly used in tort cases, the

employer is liable for the harm it’s employees commit within the scope of their employment.

Depending on whether Manuela’s act falls under the “scope of employment,” you and Brain

Cellular can sue Mind Mobile. It is likely that Manuela’s act falls under the scope of

employment because she was combining her business with that of Mind Mobile and Manuela

was attending both at the same time. Since Brain Cellular is Mind Mobile’s largest competition,

it is likely that Manuela defamed you and Brain Cellular with a goal of improving her business.

If Manuela’s actions fall under the scope of her employment, you and Brain Cellular can also sue

Mind Mobile.

Though we can sue Manuela, we cannot sue YouTube. Under Section 230 of the

Communication Decency Act, “no provider or user of an interactive computer service shall be
treated as the publisher or speaker of any information provided by another information content

provider.” Section 230 protects YouTube from lawsuits against users that are based on what the

user published on the site. Since YouTube is just the platform that Manuela chose to publish the

video on and does not have anything to do with the video content itself, it is protected under

Section 230. Therefore, we cannot sue YouTube for the video that Manuela posted on the

website.

What court are we able to sue in?

In order for a court to hear a case and render a decision, there must be jurisdiction. There

are three types of jurisdiction that a court must have – original or appellate jurisdiction, in

personam jurisdiction, and subject matter jurisdiction. Original jurisdiction is the power to

initially hear and decide on a case. Since your case and Brain Cellular’s case has not been to

court before, there is original jurisdiction. Both state and federal courts have the power to review

cases with original jurisdiction. Unfortunately, since this is a new lawsuit, it cannot be brought to

the Supreme Court since they only review cases with appellate jurisdiction. In addition, the court

must have in personam jurisdiction. To have in personam jurisdiction, Manuela must reside in

the state the lawsuit is filed in, have sufficient minimum contacts in that state, or be in the state

when served with the lawsuit. For Mind Mobile, there is in personam jurisdiction in the state that

the business is headquarter or incorporated in, if the business’s principle place of business is in

the state, or if the business has sufficient minimum contacts in a state. If you file in a court that

satisfies one of these requirement, there will be in personam jurisdiction. There is in personam

jurisdiction in Delaware, since Mind Mobile is incorporated there and Illinois since Manuela

lives in the state and Mind Mobile is incorporated there. It may also be possible to file the

lawsuit in California, if Manuela and Mind Mobile have sufficient minimum contacts in the state
or Manuela is in the state when served with the lawsuit. Finally, there needs to be subject matter

jurisdiction, which determines which court you will be able to file the lawsuit in. A majority of

tort law is based on state law and is usually examined in state court. Since Manuela committed

tort, it is likely that there will be subject matter jurisdiction in state courts. However, if Manuela

resides in different states from you and Brain Cellular and the amount of controversy exceeds

$75,000, then there is diversity of citizenship and you and Brain Cellular can take the lawsuit to

federal court. You and Brain Cellular are able to sue Manuela and Mind Mobile in any court that

has all three types of jurisdiction.

How much money can we get?

A goal of tort law is to compensate the innocents who are injured. Since Manuela

committed tort you will be able to claim damages. If you and Brain Cellular win the lawsuit, you

will be able to claim compensatory damages and receive compensation for all the harm that

Manuela’s actions have cause to you and your business. Specifically, for libel and slander, you

will also be able to claim general and specific damages. General damages provide compensation

for injuries that are hard to quantify. Specific damages provide compensation for monetary

losses, in this case, you will be able to receive compensation for the lost $6,000,000 from the

cancelled TurboTaxi contract. In addition to compensatory damages, if Manuela’s conducts

justify as punitive, you may be able to claim punitive damages. Punitive damages are intended to

punish the defendant for unreasonable, harmful acts.

Can Parker Smith sue Brain Cellular for his injury?

Though Parker can sue the doctor for malpractice if he would like, Brain Cellular is still

liable for the product sold to Parker, therefore, Parker is able to sue Brain Cellular. Parker will

likely allege that the Brain Cellular phone caused damages to his physical being. Under the
allegation, Parker can claim strict product liability for breach of warranty, negligence, and strict

liability in tort.

For every product sold, there is an implied warranty of merchantability, that implies that

the product will work properly. For every Brain Cellular phone sold, there is an implied warranty

suggesting that it will work accordingly and an expressed warranty for two years. Since the

phone that Parker purchased did not work properly and damaged his occipital lobes, Brain

Cellular is liable for the damages the phone caused to Parker. Since Brain Cellular is liable,

Parker is able to sue.

In addition, Parker can claim negligence in manufacturing. If Parker is able to prove that

Brain Cellular failed to live up to the standard of care a reasonable person would meet to protect

others, Parker can claim negligence. However, to claim negligence, Parker will have to prove

that Brain Cellular owed a duty of care and breached that duty, causing Parker compensable

injuries. If Parker is able to prove that there is an issue with the manufacturing, Parker can sue

Brain Cellular for negligence. However, since there are many employees that are work in

manufacturing, it will be difficult for Parker to prove that there is an issue with manufacturing,

so it is likely he will not win the negligence case.

Parker may also be able to sue for strict liability. Under strict liability, the company who

sells a defective product that is dangerous is liable for physical harm cause to the user if the

product was defective when sold and does not change conditions before reaching the consumer.

If the judge determines that Brain Cellular’s phones are reasonably dangerous, Brain Cellular

will be liable for the damages caused to Parker. Though there are many claims that Parker can

allege, Parker will likely claim breach of warranty since it is easier to prove than negligence and

strict liability.
I would advise trying to settle with Parker. This way, it is more confidential. Less people

will hear about the lawsuit, so it will not hurt the reputation of the business as much as a lawsuit

would.

Where does Parker Smith have jurisdiction to sue Brain Cellular?

Though Parker Smith bought the phone in California, where he is able to sue, there are other

states where Parker has the ability to sue. Parker can sue in South Carolina if there is original

jurisdiction, in personom jurisdiction, and subject matter jurisdiction. Since Smith’s claims is

part of a new case, there is original jurisdiction and a trial court has the power to hear and make a

decision regarding the case. In addition, it is likely that there is in personam jurisdiction because

individuals have access to Brain Cellular’s website in every state, thus it is likely that there are

sufficient business interactions on the site. Since Brain Cellular targets each state through its

marketing campaign and customers statewide have access to order phones online, Brain Cellular

likely has sufficient minimum contacts in the state of South Carolina. Finally, since the case

involves torts, which are usually based on state law, there is subject matter jurisdiction in the

state courts. If all three types of jurisdiction are satisfied, Smith has the power to sue in South

Carolina.

Unfortunately, we cannot prevent Smith from filing in state court, however we file a motion

to dismiss. By filing a motion to dismiss, you will be asking the court to throw out the case. If

the motion to dismiss is denied you can file a motion for removal and bring the case to federal

court. Another way to bring the lawsuit to federal court is by diversity of citizenship. Since both

the company and Smith reside in different states and he claims his injuries exceed $800,000,

which is above the minimum $75,000, we can take the case to federal court.

Do we have to comply with Congress’s statute even though the standards are not specified?
Under the Commerce Clause, Congress has the power to regulate commerce among the

states. Therefore, Congress has the ability to exercise legislative power over state activities and is

able to regulate the safety standards of brain implant technology. Oftentimes, Congress passes

laws addressing complex matters, but does not go into detail about the matter since they are not

experts in the area. Instead, Congress delegates roles to administrative agencies to create specific

rules to regulate. Federal administrative law trumps state law, so we must abide by

administrative law. Though the statutes that Congress passed are vague, they must be followed.

It is possible that the statute that Congress passed preempts California law. Since

Congress does not explicitly state that federal law trumps state law in the area of regulation, it is

possible that there is implied preemption. If the statute that Congress passed regulates a large

area, it may be a type of field preemption, in which we would have to follow the statute Congress

passed. Another issue is whether there is conflict preemption. Conflict preemption exists when it

is impossible to comply with both state law and federal law. If it is impossible to comply with

both federal and state law, you must comply with federal law. If Congress’s statute preempts

California law, then there is an issue since Brain Cellular will need to comply with the statute

Congress passed. It is best if you look further into the administrative law regarding brain implant

technology and begin complying with the law.

Can you be charged with committing a crime even though you did not have an intention to

harm?

If Congress passed a statute to regarding brain implant technology and a company

violated a part of the statute, the company can be accused of committing a crime. In order to

prove a company committed a crime, the plaintiff must prove the crime included a “mens rea” –

a guilty mind. If you did not deliberately intend to harm anyone, there is no mens rea and it is
likely that you will not be charged with a crime, unless Congress determines that the act is a

regulatory crime. A regulatory crime is created when legislature decides that the need to protect

the public outweighs the requirement of a mens rea. If the legislature determines that a crime

falls under the definition of a regulatory crime, then the mens rea does not need to be proven and

the individual can be guilty based on strict liability. If the use of brain implant technology is

considered a regulatory crime, a mens rea does not need to be proven. Therefore, you can be

sued even though there is no intent to harm.

Does the Consumer Product Safety Commission have the right to only sue companies run

by women?

Though the United States is a free country, there are certain laws that the government

must abide by. The Constitution is the supreme law of the land that established principles that

protect the fundamental rights of US citizens. The fourteenth amendment of the Constitution

established the Equal Protection Clause. The Equal Protection Clause prevents the government

from denying equal protection of the law to citizens. The government is not able to discriminate

without sufficient jurisdiction. Since the Consumer Product Safety Commission (CPSC) is a

government agency, it must comply with the Equal Protection Clause and does not have the right

to only sue companies run by women. If the CPSC is only suing women, it is violating the

fourteenth amendment and CPSC can be sued for not protecting the rights of citizens. Due to the

Equal Protection Clause, you have an equal possibility of being sued as a female president who

committed the same crime.