SOC&USBL

FINAL-EXAM Business Law | July 19, 2019 | marks 40

INSTRUCTIONS

• The homework for every week except third week (mid-exam) and fifth week (final-exam) will be uploaded in the online study portal. For third week the mid-exam will be uploaded and for fifth week final-exam will be available.

• You are required to finish and send the homework back to professor before Friday of next week for homework in week 1,2 and 4. For mid and final-exams, you are required to send back before Monday of next week.

• Every assignment you submit to professor, the following information must be included 1. Name (both Chinese and Pinyin) 2. Homework week number/ mid or final Exam

SHORT QUESTIONS (ALL QUESTIONS) 2 * 10 = 20

1. What is trade dress? 2. What is the USDA? What is the purpose of the USDA? 3. Define Bait and Switch? 4. Describe an environmental impact statement and identify when one is needed? 5. Explain how environmental laws regulate the use of toxic substances and the disposal of hazardous

wastes? 6. Describe the enforcement of federal antitrust laws? 7. Explain how the lawfulness of mergers is examined under Section 7 of the Clayton Act? 8. Explain the liability of bailees for lost damaged, or destroyed goods? 9. Define personal property? 10. Describe the zoning laws.

SUBJECTIVE QUESTIONS (ANY FOUR QUESTIONS) 5 * 4= 20

1. 42.1 False Advertising Papa John’s International, Inc., is the third-largest pizza chain in the United States, with more than 2,050 locations. Papa John’s adopted a new slogan— “Better Ingredients. Better Pizza.”—and applied for and received a federal trademark for this slogan. Papa John’s spent over $300 million building customer recognition and goodwill for this slogan. This slogan has appeared on millions of signs, shirts, menus, pizza boxes, napkins, and other items, and it has regularly appeared as the tag line at the end of Papa John’s radio and television advertisements.

2

Pizza Hut, Inc., is the largest pizza chain in the United States, with more than 7,000 restaurants. Pizza Hut launched a new advertising campaign in which it declared “war” on poor-quality pizza. The advertisements touted the “better taste” of Pizza Hut’s pizza and “dared” anyone to find a better pizza. Pizza Hut also filed a civil action in federal court, charging Papa John’s with false advertising in violation of Section 43(a) of the federal Lanham Act. What is false advertising? What is puffery? How do they differ from one another? Are consumers smart enough to see through companies’ puffery? Is the Papa John’s advertising slogan “Better Ingredients? Better Pizza” false advertising? Pizza Hut, Inc. v. Papa John’s International, Inc., 227 F.3d 489, Web 2000 U.S. App. Lexis 23444 (United States Court of Appeals for the Fifth Circuit)

2. Rule Making The Food and Drug Administration (FDA), a federal administrative agency, is charged with enforcing the Food, Drug, and Cosmetic Act. This statute mandates that the FDA limit the amount of “poisonous or deleterious substances” in food. Pursuant to this authority, the FDA established certain “action levels” of unavoidable contaminants, such as aflatoxins, in food. Food producers that sell products that are contaminated above the set action level are subject to enforcement proceedings initiated by the FDA. In announcing these action levels, the FDA did not comply with the notice and comment procedure required for the adoption of a substantive or legislative rule. The FDA argued that the “action levels” are merely interpretive rules or statements of policy that do not re- quire notice and comment. The Community Nutrition Institute, a consortium of consumer public interest groups, sued to require the FDA to follow the notice and comment procedure. Who wins? Community Nutrition Institute v. Young, 260 U.S. App. D.C. 294, 818 F.2d 943, Web 1987 U.S. App. Lexis 6385 (United States Court of Appeals for the District of Columbia Circuit)

3. Food Regulation Barry Engel owned and operated the Gel Spice Co., Inc. (Gel Spice), which specialized in the importation and packaging of various food spices for resale. All the spices Gel Spice imported were unloaded at a pier in New York City and taken to a ware- house on McDonald Avenue. Storage and repackaging of the spices took place in the warehouse. During three years, the McDonald Avenue warehouse was inspected four times by investigators from the Food and Drug Administration (FDA). The investigators found live rats in bags of basil leaves, rodent droppings in boxes of chili peppers, and mammalian urine in bags of sesame seeds. The investigators produced additional evidence which showed that spices packaged and sold from the warehouse contained insects, rodent excreta pellets, rodent hair, and rodent urine. The FDA brought criminal charges against Engel and Gel Spice. Are they guilty? United States v. Gel Spice Co., Inc., 601 F.Supp. 1205, Web 1984 U.S. Dist. Lexis 21041 (United States District Court for the Eastern District of New York)

4. Environmental Impact Statement The U.S. Forest Service is responsible for managing the country’s national forests for recreational and other purposes. This includes issuing special-use permits to private companies to operate ski areas on federal lands. Sandy Butte is a 6,000-foot mountain located in the Okanogan National Forest in Okanogan County, Washington. Sandy Butte, like the Methow Valley it overlooks, is a pristine, unspoiled, sparsely populated area located within the North Cascades National Park. Large populations of mule deer and other animals exist in the park.

3

Methow Recreation, Inc. (MRI), applied to the Forest Service for a special-use permit to develop and operate its proposed Early Winters Ski Resort on Sandy Butte and a 1,165-acre parcel of private land it had acquired adjacent to the national forest. The proposed development would make use of approximately 3,900 acres of Sandy Butte to provide up to 16 ski lifts capable of accommodating 10,500 skiers at one time. Is an environmental impact statement required? Robertson v. Methow Valley Citizens Council, 490 U.S. 332, 109 S.Ct. 1835, 104 L.Ed.2d 351, Web 1989 U.S. Lexis 2160 (Supreme Court of the United States)

5. List and describe the different types of real property. 6. Joint Tenancy Verna M. Chappell owned a piece of real property. Subsequently, Chappell

transferred the property to herself and her niece, Bertha M. Stewart, as joint tenants. When Chappell died 16 years later, Chappell’s gross estate was set at $28,321, which included the value of the house. Claims, debts, and charges against the estate totaled $19,451, which included a $14,040 claim by Lorna M. Rembe for services provided as conservator. The probate assets available to pay the claims and debts came to only $1,571 if the real property went to Stewart as the joint tenant. Rembe sued, alleging that the value of the real property should be used to pay off Chappell’s debts and claims. Who wins? Rembe v. Stewart, 387 N.W.2d 313, Web 1986 Iowa Sup. Lexis 1177 (Supreme Court of Iowa)