Va-Va-Voom Products, Inc., engages in deceptive advertising when it markets its
product Weight-No-More as able to help consumers lose weight in their sleep.
Va-Va-Voom is ordered to include in all future advertising of Weight-No-More the
statement, “This product will not cause anyone to lose weight while sleeping. This is
a. a counteradvertising order.
b. a multiple product order.
c. a “cooling-off law.
d. a validation notice.
Fact Pattern 35-2A
Beth, who has a disability, is an employee of Corporate Office Company (COC). After
the installation of new doors on COCs building, Beth finds it nearly impossible to get in
and out. For repeatedly failing to be on time, COC replaces Beth with Dian, who does
not have a disability.
Refer to Fact Pattern 35-2A. To successfully defend against Beths claim, COC will
have to show that
a. Beth consistently failed to meet the essential requirements of her job.
b. COC cannot make changes to the doors without undue hardship.
c. Dian is qualified for Beths position.
d. the doors were not installed as an act of intentional discrimination.
Page opens Quik Xpress, a local delivery service. Unless Page expressly adopts a
certain form of business organization, the law considers Quik to be
a. a corporation.
b. a limited liability company.
c. a partnership.
d. a sole proprietorship.
Oberon is a salesperson for Precision Instruments, Inc. He tells Quad, a customer, that a
device has a certain capability when, as Oberon knows, it does not. In reliance, Quad
buys the device. Liable for this misrepresentation is
a. neither Oberon nor Precision.
b. Oberon and Precision.
c. Oberon only.
d. Precision only.
Craig is a state court judge. In his court, as in most state courts, legal and equitable
remedies have merged. But it is important to distinguish between equitable and legal
remedies
a. because neither type of remedy can be granted today.
b. for no good reason.
c. to negotiate an enforceable business contract.
d. to request a proper remedy.
Nero opened Oh! Fudge!, a candy store, as a corporation. When doing business on
behalf of the store, to avoid personal liability, Nero should sign contracts
a. as an agent for the corporation.
b. in his individual capacity.
c. as a gourmand.
d. under a false name.
Fact Patter 41-2A
Petro Drilling Corporation combines its assets and debts with those of Oil Refining
Company to form New Energy, Inc.
Refer to Fact Pattern 41-2A. New Energy assumes
a. all of Petros and Oils assets.
b. half of Petros and Oils assets.
c. none of Petros and Oils assets.
d. only debts that Petro and Oil incurred after a combination was proposed.
Tristan hires Stefani to perform at Tristans Club, but she breaches the agreement to
accept a higher-paying job at Rock Star Arena. Tristan files a suit against her. The court
will most likely
a. award damages to Tristan.
b. cancel Stefani and Rock Stars contract.
c. order Stefani to perform the contract.
d. reform Tristan and Stefanis contract.
The Consumer Product Safety Commission (CPSC) wants Monster Toy Company to
produce certain records for review. To obtain the records, the CPSC will issue
a. an order for specific performance.
b. a rule for parol evidence.
c. a formal complaint.
d. a subpoena.
The title of a case appears as “Duck Down Corp. v. Egret Feathers Co. The party in
whose favor the case was decided
a. could be either party.
b. might be neither party.
c. must be Duck.
d. must be Egret.
Fact Pattern 1-A1
The Texas Supreme Court decides the case of Livewire Entertainment Co. v. Power
Play Corp. Of nine justices, six believe the judgment should be in Livewires favor.
Justice Bellamy, one of the six, writes a separate opinion. The four justices who believe
the judgment should be in Powers favor join in a third separate opinion.
Refer to Fact Pattern 1-1. The opinion joined by the four justices who favor Power is
known as
a. a concurring opinion.
b. a dissenting opinion.
c. a majority opinion.
d. a per curiam opinion.
Iowa enacts a law that restricts certain kinds of advertising to protect consumers from
being misled. This law would likely be held by a court to be
a. an unconstitutional restriction of speech.
b. constitutional under the First Amendment.
c. justified by the need to protect individual rights.
d. necessary to protect state interests.
In deciding questions of corporate social responsibility, Valley Disposal & Recycling,
Inc., is concerned with
a. how the corporation can best fulfill any ethical duty to society.
b. the effect on corporate profits of ignoring any ethical duty to society.
c. whether the corporation owes any ethical duty to society.
d. all of the choices.
Petra signs a check payable to Quincy, who indorses the back, gives it to Regional
Credit Union, and receives cash. The transfer of the check from Quincy to the credit
union is
a. an assignment.
b. a negotiation.
c. a payment.
d. a sale.
Bro wants to incorporate Chop Shop, a motor vehicle repair business. Incorporating
requires filing, with the appropriate state office,
a. a copy of the corporate liability insurance policy.
b. a corporate name.
c. corporate bylaws.
d. nothing.
Kelsy obtains a business liability insurance policy from Luminous Insurance Company
for Kelsys Framing & Art Supplies store. When an event occurs that gives rise to a
claim, each party has a duty to
a. cooperate in an investigation to determine the facts.
b. file a suit against the other so that a court can settle the claim.
c. find a third party on whom to impose liability.
d. pay any outstanding premium or refund any unearned amount.
Emma, Frick, Glenda, and Huey are employees of different-sized employers in different
industries. Under the Fair Labor Standards Act, a minimum wage must be paid to
employees in
a. all industries.
b. covered industries only.
c. no industries.
d. small-business industries only.
Debit & Credit Accounting Services and Brickwork Construction Company negotiate a
contract. If it has all of the elements necessary for one of the parties to enforce it in
court, it is
a. a valid contract.
b. a voidable contract.
c. a void contract.
d. an unenforceable contract.
Midwest Power Corporation wants to build a nuclear power plant on private land, for
which a federal permit is required. For this action, an environmental impact statement is
a. prohibited.
b. required.
c. unnecessary.
d. voluntary.
Boz runs an illegal gambling business and pays Colin, a law enforcement officer, not to
interfere. The payments are discovered. Boz and Colin are sent to prison. With respect
to the amount of the payments, Boz can recover
a. all of it.
b. none of it.
c. only as much as Colin has not spent.
d. only as much as Colin has spent.
Delicious Fruit-of-the-Month Company currently employs five hundred full-time
workers and two hundred part-time seasonal workers. Because business has declined,
Delicious plans to close a plant that employs more than fifty full-time workers.
Advance notice of the layoff must be sent to
a. affected workers or their union representative.
b. all workers, even those who are not being laid off.
c. potential customers and suppliers.
d. no one.
Fact Pattern 46-1B
Rock Mining Company operates a gravel pit next to Sids residence. Sid files a suit
against Rock, alleging that the pit is a nuisance and unreasonably interferes with Sids
enjoyment of his property.
Refer to Fact Pattern 46-1B. The court is most likely to award Sid an injunction
a. if letting the pollution continue is equally as harmful as stopping it.
b. if letting the pollution continue is less harmful than stopping it.
c. if letting the pollution continue is more harmful than stopping it.
d. under no circumstances.
Leasing Equipment Corporation (LEC) agrees to lease five computer workstations to
Mapmakers, Inc. Before any interest in the workstations can pass from LEC to
Mapmakers, they must be
a. in existence and identified as the goods in the contract.
b. in LECs physical possession.
c. in Mapmakerss physical possession.
d. listed in a document of title and filed in the appropriate state office.
Finished Furnishings, Inc., agrees to lease an Oak Top-brand desk to Research
Resources, Inc. (RRI), which agrees to pick it up at Streetside Warehouse. Before RRI
retrieves the desk, it is stolen. The loss is suffered by
a. Perfect Furnishings.
b. Oak Top.
c. Streetside Warehouse.
d. RRI.
Mason creates a trust to prevent his son, Newt, the beneficiary, from assigning his rights
to future payments of income from the trust. This is
a. a charitable trust.
b. a constructive trust.
c. a spendthrift trust.
d. an illegal trust.
Real Cheap Painters, Inc., agrees to paint Quints house, using a particular brand of
“discount paint. Real Cheap completes the job but uses a different brand of discounted
paint. This is most likely
a. an absolute excuse for Quints refusal to pay.
b. a material breach.
c. complete performance.
d. substantial performance.
Mac files a petition for a discharge in bankruptcy. Macs failure to appear at a meeting
of the creditors listed in Macs schedules may result in Mac being
a. denied a discharge of bankruptcy.
b. fined.
c. held in contempt.
d. imprisoned.
To acquire monopoly power in its market, Pure Plastics, Inc., sets its prices
substantially below the normal costs of production. Under antitrust law, this is
a. a per se violation.
b. a violation if its competitors make similar deals.
c. a violation if it thereby acquires monopoly power.
d. not a violation.
Laraby, a representative for Merchandise Shipping Company, delivers a bill of lading to
Caitlin, the owner of Dockside Warehouse. A bill of lading is
a. an invoice for payment for loading and carting verified by a seller.
b. an order to ship goods signed by a buyer.
c. a receipt for goods signed by a carrier.
d. a receipt issued by a warehouser for goods in a warehouse.
Great Tans, Inc., uses, in its radio ads, a recording by Holly, who owns the rights,
without paying for the use. Over time, the song comes to be associated with Great Tans.
In Hollys suit against Great Tans, the firm is most likely liable for
a. appropriation.
b. conversion.
c. wrongful interference with a customary relationship.
d. none of the choices.
Pablo and Melia enter into an oral contract for Pablos sale to Melia of a laptop
computer for $400. Assuming the terms can be proved, the contract is enforceable by
a. the seller or the buyer.
b. the manufacturer of the laptop.
c. any third party who overheard the parties making the agreement.
d. none of the choices.
Isabel obtains a fire insurance policy on her home from Justice Insurance Company.
The home is lost in a fire, but the parties dispute the amount of Justices liability under
an ambiguous clause in the policy. A court would most likely
a. interpret the clause against Isabel.
b. interpret the clause against Justice.
c. rewrite the clause and apply it as rewritten.
d. strike the clause from the policy.
Cameron manages an illegal gambling operation in his BBQ Bar & Grill. Cameron
reports the profits of the gambling operation as income from BBQs legitimate activities
on its tax returns. This is
a. embezzlement.
b. larceny.
c. money laundering.
d. no crime.
A target corporations attempted takeover of an acquiring corporation is referred to as
the Pac-Man defense.
Misrepresentation of a material fact cannot occur through words alone.
A principal is exposed to tort liability whenever a third person sustains a loss due to an
agents misrepresentation.
For a plaintiff to recover damages under Section 10(b) of the Securities Exchange Act
of 1934 and SEC Rule 10b-5, ordinary negligence is enough.
Only the manufacturer of a defective product can be strictly liable for an injury or
damage caused by the product.
An assignees rights are subject to the defenses that the obligor has against the assignor.
To use attachment as a remedy, a creditor must have possession of (be “attached to) a
debtors property.
A corporation is a legal entity created and recognized by federal law.
A court will not pierce the corporate veil of a corporation that is merely too “thinly
capitalized.
Dale issues a check for $4,000, dated June 1, to Evelyn. The check is drawn on First
Federal Bank. Evelyn indorses the check and transfers it to Gene. What will trigger the
liability of Dale and Evelyn on the check?
Whistleblowing occurs when an employer signals the end of a work day by sounding a
buzzer, ringing a bell, or otherwise “blowing the whistle “
Bribery of foreign government officials is both an ethical and a legal issue.
Dividends can be paid in the stock of the corporation that is paying the dividends.
A judge instructs a jury in the law that applies in a case.
A divorce necessarily revokes an entire will.
The property of a decedent escheats to his or her designated heirs.
A long arm statute permits a court to obtain jurisdiction over an out-of-state defendant.