law (legal environment of business)

Week 3

Group 1

Chapter 13

9- Michael Merkle was fired from T- Mobile USA, Inc., after he had allegedly been seen drunk at a company conference. Merkle, who had worked for T- Mobile for 11 years, denied being drunk at the event. During a meeting between Merkle and the senior human resource manager, Merkle was simultaneously informed of the allegations against him and fired. When Merkle began employment at T- Mobile, he was given the company handbook, which sets forth T- Mobile’s policy of internally investigating all claims of suspected or alleged employee misconduct. Merkle claimed that no internal investigation had been conducted. T- Mobile did not deny the existence of the investigation portion of the handbook or the lack of investigation in this case. The company did, however, contend that there were sufficient disclaimers throughout the handbook, which stated that no portion of the handbook constituted a con-tract. Merkle further asserted that as a result of T- Mobile’s investigations of other employees (one employee had actually been drunk) as well as the company’s track record for providing warnings, a precedent had been set to provide a warning or investigation before termination. Merkle filed suit against T- Mobile for breach of an implied con-tract of employment. Do you think that T- Mobile’s handbook and prior disciplinary actions constitute an implied contract of employment? Why or why not? [Michael Merkle v. T- Mobile USA, Inc., 2008 U. S. Dist. LEXIS 63614.]

-The plaintiff:

-The defendant

-Facts associated with the case

-The appropriate legal issues in question, provide a judgment who should win the case

-Support your decision with an appropriate rule of law

-Be prepared to defend your decision and to objectively evaluate the other points of view

chapter 14

6- The Pennsylvania Department of Transportation (PennDOT) issued a Request for Bid Proposal for Vending Machine Services for rest areas on high-ways in the state. ATI submitted the lowest bid for the sites. PennDOT selected ATI for a contract for 35 vending sites. Enclosed with the notice of award sent to ATI was a service purchase contract to be executed by ATI, by PennDOT, by the commonwealth comptroller, and by PennDOT’s attorney. Also, “ if required,” signature lines for the Office of General Counsel and the Attorney General’s Office were provided. The award notice indicated that the contract would become effective “ after all approvals have been received from the administrative and fiscal personnel in Harrisburg” and further stated that no activities may be performed until the contract is fully executed. ATI returned an executed contract to PennDOT. PennDOT’s director of the Bureau of Maintenance and Operations and a representative from its legal department executed the agreement. The comptroller and Office of General Counsel subsequently signed the contract; however, the Attorney General’s Office refused to execute the agreement. The Attorney General’s Office subsequently filed criminal charges, related to sales tax issues, against ATI’s president. As a result, the Attorney General’s Office notified PennDOT it would not approve the contract. PennDOT never returned an executed contract to ATI or provided a notice- to- proceed to ATI. Instead, PennDOT notified ATI it would not enter into the con-tract because it determined ATI is not a responsible contractor. ATI filed a complaint alleging PennDOT breached a valid contract. After the hearing, the board determined that PennDOT never delivered an acceptance of the offer to ATI and, as a result, a contract was never formed. ATI appealed, arguing that the board erred in finding a contract did not exist because PennDOT’s representatives, who signed the contract, intended to bind PennDOT to the terms of the con-tract. How did the court rule on appeal? Did the documents contain a proper acceptance? [Makoroff v. DOT, 938 A. 2d 470 ( Pa. Commw. Ct. 2007).]

Chapter 14

7- Plaintiff Business Systems Engineering, Inc., was one of several subcontractors that agreed to provide technical consultants for defendant IBM’s work on a transit project. In a “ plan of utilization” provided by IBM to the transit authority, IBM had listed Business Systems as one of its intended subcontractors, with $ 3.6 million listed on that document under the heading “ contract amount.” The terms of the arrangement between IBM and its subcontractors for the job were that when IBM needed technical consultants for a part of the project, the subs would submit bids and when the subcontractor’s bid was accepted, the subcontractor would receive a specific statement of work detailing the scope of the specific project, the time frame, the conditions under which the task would be deemed complete, and the hourly wage, followed by a work authorization. The transit authority retained the authority to reject any individual consultant who was selected by the subcontractor, and the contract between the subcontractors and IBM incorporated by reference the contract between IBM and the transit authority. Work was not to begin until a final work authorization was issued. At the end of the project, 38 work authorizations had been issued to the plaintiff by the defendant for a total of $ 2.2 million, rather than the $ 3.6 million that had been projected in the original estimate IBM had provided to the transit authority. IBM had paid the plaintiff the $ 2.2 million for the work done on the work authorizations, but the plaintiff argued that it should have been entitled to the full $ 3.6 million contained in the estimate that was incorporated by reference in the contracts between IBM and the sub-contractors. The plaintiff argued that it had a con-tract with IBM for the full $ 3.6 million. The district court granted summary judgment for the defendant. What do you think the plaintiff’s argument was on appeal? What do think the outcome of the appeal was and why? [Business Systems Engineering, Inc. v. International Business Machines Corp., 547 F. 3d 883, 2008 U. S. App LEXIS 23682.]