Eastman Publishing Company is considering publishing a paperback textbook on spreadsheet applications for business. The fixed cost of manuscript preparation, textbook design, and production setup is estimated to be $60,000.
On page 141 of the text, write a brief paper on the following discussion question. Must be at least 800 words on the topic of “Are most accidents and injuries covered by tort law?” and “Why or why not?” This assignment is directly related to the objective regarding the category of negligence Torts and you should discuss the elements of negligence torts. It would be a good idea to discuss at least some defenses to negligence torts, as well.
MGT 3410 Homework 1 Fall 2023
Models of Cost, Revenue and Profit
Eastman Publishing Company is considering publishing a paperback textbook on spreadsheet applications for business. The fixed cost of manuscript preparation, textbook design, and production setup is estimated to be $60,000. Variable production and material costs are estimated to be $3 per book. Demand over the life of the book is estimated to be 3800 copies. The publisher plans to sell the text to college and university bookstores for $18 each.
What is the breakeven point?
What profit or loss can be anticipated with a demand of 3800 copies?
With a demand of 3800 copies, what is the minimum price per copy that the publisher must charge to break even?
If the publisher believes that the price per copy could be increased to $21.95 and not affect the anticipated demand of 3800 copies, what action would you recommend? What profit or loss can be anticipated?
Micromedia offers computer training seminars on a variety of topics. In the seminars each student work at a personal computer, practicing the particular activity that the instructor is presenting. Micromedia is currently planning a two-day seminar on the use of Microsoft Excel in statistical analysis. The projected fee for the seminar is $700 per student. The cost for the conference room, instructor compensation, lab assistants, and promotion is $11000. Micromedia rents computers for its seminars at a cost of $65 per computer per day.
Develop a model for the total cost to put on the seminar. Let x represent the number of students who enroll in the seminar.
Develop a model for the total profit if x students enroll in the seminar.
Micromedia has forecasted an enrollment of 30 students for the seminar. How much profit will be earned of its forecast is accurate?
Compute the breakeven point.
Due date: Sep 6, 11:59pm
Note: Homework solution must be submitted electronically to Homework 1 folder in “Assignments” on D2L.
It is your choice to submit all of your work or just the final answer only. If you only submit the final answer and the answer is wrong, you will lose all the points assigned to that question. If you also show the steps how you get that answer, you still can earn partial credit as long as the steps are not completely wrong.
Elements of TortsChapter 6Meiners, Ringleb & EdwardsThe Legal Environment of Business, 13thEd.©2018 Cengage Learning®. May not be scanned, copied or duplicated or posted to a publicly accessible website, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website or school-approved learning management system for classroom use.
TORTS & THE LEGAL SYSTEMThe word tort derived from Latin tortusor “twisted.” Means “wrong” in Old French.A tort is a civil wrong, other than a breach of contract, for which the law provides a remedy.•Breach of a legal duty owed to another that causes harm •Torts arise from careless errors or intentional actions•The law reflects social values and standards•Lawsuits involving businesses can have large awards. In Pennzoil-Texaco case jury awarded $10.5 billion.•Has become a major issue for businesses
Business and TortsCategoriesNegligenceIntentional Strict LiabilityBusiness becomes involved through(1) person is harmed by actions of business or its employees(2) a person is harmed by a product manufactured or distributed by the business(3) a business is harmed by the wrongful actions of another business or personSome torts are unique to businesses (Chapter 7)Torts can be specific to property (Chapter 8)
The Role of Tort Law•Tort law allows compensation for injuries wrongfully inflicted by a defendant on a plaintiff •Civilnot criminal law•Law is determined in each state –rules vary.•However, the basic principles are similar across states.•Remedies should place an injured party in the position he/she would have been in absent the tort.•Fear of tort action deters injurious behavior by others.•Punitive damagespunish malicious or extremely reckless behavior.
NEGLIGENCE-BASED TORTS•Unintentional careless conduct that creates an unreasonable risk of harm to others. No intent to harm needed.•Elements•1. Breach of duty of care wrongdoer owed to injured party•Owed to the plaintiff•Breach through an act or omission•2. Causation (causal connection to the injury)•3.Injury/Damages•Gross Negligence:Conscious & voluntary disregard for need to use reasonable care•More likely to lead to punitive damages
Duty of Care and the Reasonable Person Standard•The standard is how persons in the community ought to behave.•One must be reasonableat all times, under the circumstances.•Not liable for everything –only for “unreasonable”acts•Standard: “What a reasonable person would do in same or similar circumstances?”•Applies to professions –CPA, MD, attorney, etc. •What a competent and experienced professional would do
Squish La Fish v. Thomco Specialty Products•Squish holds patent on “Tuna Squeeze;” ProPack hired to assist with store displays.•ProPack got Thomco’s advice on adhesive for the displays.•Thomco said the adhesive would wash off; Squish relied on advice, but adhesive would not wash off.•A Squish distributor was not happy with adhesive; cancelled the order.•Squish sued Thomco for negligent misrepresentation.•District Court granted judgment for Thomco; Squish appealed.•Held: Reversed and remanded •Disputed issues to go before the trial court•There may have been reliance by Squish through ProPack on Thomco’s representations hence a tort of negligence.
•Causation between a party’s act & another’s injury.•Cause in factshows the person’s conduct is the actual cause of the event that created the injury (some courts call this the “but for”test [sine qua non rule]).•Proximate causeindicates that the liability bears a reasonable relationship to the negligent conduct.•In some cases, case is so obvious, res ipsa loquitur(“the thing speaks for itself”) applies.•If consequences are too remote –no liability.•If there is an intervening or superseding event/conduct–no liability.•Chain of events created by a party’s actions must be foreseeable.•Some states replace proximate cause with substantial factor test in bringing about the injury.•Danger-Invites-Rescue Doctrine•Negligent party is responsible for losses suffered by those who attempt to save people who are in danger as the result of torts of others.CAUSATION
CausationCausation between a party’s act and another’s injury.Cause in fact:a person’s conduct is the actual cause of event that created the injury (some courts call this the “but for”test [sine qua non rule]).In some instances, the case is obvious, so res ipsa loquitur(“the thing speaks for itself”) applies.If consequences are too remote –no liability.If there is an intervening or superseding event/conduct–no liability.Proximate causeindicates that the liability arises from a logical relationship to negligent conduct.Chain of events created by a party’s actions must be foreseeable.Some states replace proximate cause with substantial factor test in bringing about the injury.Danger-Invites-Rescue DoctrineNegligent party is responsible for injury suffered by those who attempt to save people in danger as the result of torts of others.
PALSGRF V. LONG ISLAND RR CO.•Palsgraf waited on a platform for a train; another train began to leave the station; man carrying a package ran to catch it; jumped on the train; might fall, so guard grabbed to help him.•He dropped package which contains fireworks that exploded.•Shock from the explosion caused scales on platform to fall, injuring Palsgraf who sued RR for negligence of its employees.•Jury found for Palsgraf; appellate court affirmed; RR appealed.•Issue: Is it foreseeablethat the assistance by the guards would causePalsgraf’s injury through the falling scales?•Held: No. Nothing in the situation would suggest such a result. Strange sequence of events involving no negligence by the railroad or its employees.•Case reversed and dismissed.
Evolving Law of Negligence•Thompson v. Kaczinski (Iowa Supreme Court)•Adopted some portions of new Restatement (Third) of Torts•Need not focus on ordinary duty of reasonable care –this duty is presumedwhere there is risk of physical harm.•Instead, court should “proceed directly to the elements of liability.”•Less reliance on proximate case –“has been a source of significant uncertainty and confusion.”•Move also away from “substantial factor.”•Instead, Restatement Thirdrefers to the “scope of liability”related to risks present in a specific situation.•Court will use a “risk standard”to judge when liability is imposed.•Changes are subtle; could take many years—state by state—to become apparent in the working of tort law in the U.S.
DEFENSES TO A NEGLIGENCE ACTIONAssumption of Risk•The injured party knew or should have known of the risk and voluntarily assumed it.•Complete bar to the plaintiff’s case•May be based on liability waiveror exculpatory clausein a contractComparative Negligence•Damages are reduced by the % of injuries caused by the plaintiff’s own negligence•Replacedold rule old rule of contributory negligence•Term contributory negligence still used, but for damages, the rule of comparative negligence is used.•Pure Comparative Negligencevs. 50% Rule
Geczi v. Lifetime Fitness Jodi Geczi was member of Lifetime Fitness in Columbus, Ohio.Was using a treadmill that began to jerk violentlyShe tried to steady herself, fell, suffered an injuryLifetime employees told her they knew the machine was broken, but no sign had been placed on it.Geczi sued Lifetime for negligenceand gross negligence.Claimed she suffered lost income, pain, and medical expensesLifetime defended that as part of the membership agreement, Geczi agreed to an exculpatory clauseThis would bar he claimShe admitted she knew of the clause of no negligence for Lifetime from using equipment. Clear in contract she signed.Claimed that Lifetime was liable for willful and wanton behaviorfor failure to warn of danger posed by the malfunctioning machine.Jury held for lifetime. She appealed.
Geczi v. Lifetime Fitnesscontinued•Issue: Whether reasonable minds can only conclude that documents Geczi signed constituted valid release of claims against Lifetime.•Previously courts recognize that law does not favor release from liability for future tortious conduct. Releases are narrowly construed.•HOWEVER, clear & unambiguous contract clauses relieving a party from liability for negligence are generally upheld in Ohio. •Provision in member Policy: •“I accept full responsibility for my use, as well as the use by any other person under my membership, of any and all equipment . . . . I agree that I will hold the Club . . . harmless from any and all loss, claim, injury, damage, or liability incurred by me. . . . I fully understand all of the Club’s policies and agree to abide by them.”•Release did not distinguish types of negligence. Any injury could be relevant.•Broad language in document extends to negligence in –•Maintaining equipment, leaving defective equipment available to users, and negligence in failing to warn of defects.•Jury looked at question if Lifetime’s failure to act or warn was “willful or wanton conduct” –found Lifetime was not.•HELD: Judgment Affirmed.
INTENTIONAL TORTS AGAINST PERSONSEstablishing IntentPerson knew what he/she was doingIntent to do the act which reasonablywould result in harm to the plaintiffKnew /should have knownthe possible consequences of an actionWillful misconduct
INTENTIONAL TORTS AGAINST PERSONSAssaultBattery False Imprisonment or False ArrestInfliction of Emotional or Mental DistressInvasion of PrivacyDefamation: Libel and Slander
•Placing plaintiff in fearof immediate bodily injury•Intentto act to cause a harmful or offensive contact•Plaintiff has imminent apprehensionor fear•Fear: if a reasonable person under the same or similar circumstances would have apprehension of bodily harm or offensive contact•Examples: •Pointing a gun? Yes•Point a gun while other person sleeps? No assault•Letter threats? Usually, no assault (“immediate”standard usually not met)•Phone threats? Maybe. How close is the caller? On a cell phone outside the window or in another town?
•Unlawful “touching”•Intentional physical contact without consent•Even if no actual physical harm, offense to a “reasonable person’s sense of dignity” may constitute a battery.•Use of fist, hand, or kicking•Use of weapons, i.e. guns or stick•Unwanted kiss? Has been held to constitute battery•Assault and Battery often linked together•Defenses•Consent•Privilege•Self defense•Defense of others/Defense of property•Most states have “stand your ground” doctrines •No requirement to retreat•Allow force for force & deadly force for deadly force
Fuerschbach v. Southwest Airlines•Fuerschbach worked as customer service representative for Southwest at Albuquerque airport.•Airline prides itself on being “fun-loving, spirited company.” •At end of probationary period, often a prank to celebrate the event.•Her supervisor thought would be fun to set up a mock arrest.•Two Albuquerque police officers came to the counter, told her of outstanding warrants against her, handcuffed her and told her she was under arrest.•She began to cry, so officers took her to the party in the back.•All the employees yelled “Congratulations for being off probation!”•Handcuffs removed; party began. She kept crying and sent home.•Saw a psychologist who said she suffered post-traumatic stress disorder.
Fuerschbach v. Southwest Airlines•Fuerschbach sued everyone connected with the event on numerous grounds, including assault and battery.•District court granted summary judgment for defendants and did not allow the matter to go to trial. •HELD: Reversed. Summary judgment vacated re: assault and battery claim. She can go to trial.•District court said officers “were courteous and professional.”•Issue: Did the actions offend “a reasonable sense of personal dignity?”•HELD: Jury might be able to conclude that being handcuffed and leading the person to walk fifteen feet offends a “reasonable sense of personal dignity.”•Police handcuffed her –could be offensive contact.•Note: Some other claims allowed to go forward; others were denied. The only claim against Southwest Airlines was a Workers’ Compensation claim because there was no intent by anyone to harm her at work.
FALSE IMPRISONMENT(FALSE ARREST)•Intentional holding, detaining or confinement•Freedom to come and go is restrained•Restraint or Confinement•May be physical•May be mental (i.e. through verbal threats)•Using position of authority•Lawsuits often arise from detention of suspected shoplifters•Defense by businesses regarding detention of shoplifters•Restraint was in a reasonable manner•Restraint was in a reasonable time •Basis for the detention was valid
Harter v. Edwards•Edwards purse stolen; thief tried to use credit cards.•She contacted businesses about matter.•Detective Harder of Fort Lauderdale PD had been working on fraudulent check ring.•Edwards’ checking account was one thieves used for fraudulent checks.•Check from Edwards’ account written to T.J. Maxx –store cooperated with police.•Officers arrested 23 people alleged in involvement in check scam.•Edwards arrested. Family bailed her out; charges dropped.•She sued Detective Harder, Police Department, T.J Maxx & store employee Carlson who provided information to police about bogus checks.•Trial Court: Found for Edwards. Defendants appealed.Continued
Harter v. Edwards, cont.•False imprisonment entails “imprisonment contrary to [the plaintiff’s] will and unlawfulness of detention.”•Where criminal activity encountered, “public policy of Florida is to give wide latitude to an individual reported suspect crime.”•This ensures “a free flow in information between the people and the police.”•Carlson acted reasonable in pursuing his investigation.Merely provided Detective Harder with fraudulent checks.•Detective Harter exercised his discretion in pursing his investigation.•Evidence here is sufficient to establish probable cause for Edwards’ arrest.•HELD: Reversed; judgment for defendants.
Infliction of Emotional Distress/Mental Distress•Intentional conduct: So outrageous, it creates severemental or emotional distress•Petty insults, annoying behavior, bad language? Usually not actionable; we must have “tough skin.”•Bill collectors or landlords who badger, are profane, or threaten lay the background for a lawsuit.•Ex: Louisiana court gave award to a woman who found her comatose husband being chewed by rats in a hospital
Lawler v. Montblanc•Montblanc makes high-end writing implements and other luxury products.•Sells wholesale and at boutique retail stores.•Cynthia Lawler was retail store manager in California for 8 years.She was expected to work full time.•In 8thyear, Lawler developed medical conditions –doctor said she could only work 20 hours/week.•She informed Montblanc.•Was told as a manger she had to work at least 40 hours /week.•President of company visited and was critical of way store was run.•Lawler testified he was “unpleasant.”•Sshe told the company her doctor said she should not work full time.•Company said that was part of her position; offered her severance pay.•She refused; sued for intentional infliction of emotional distress.•District Court held for Montblanc. Continued
Lawler v. Montblanc, cont.•California’s cause of action for intentional infliction of emotional distress:•(1) extreme and outrageous conduct by defendant with intentionof causing or probability of causing emotional distress•(2) plaintiff suffered severe or extreme emotional distress•(3) actual and proximate cause of emotional distress was by defendant’s outrageous conduct•Outrageous: When so extreme it exceeds all bounds usually tolerated in a civilized community. Does not extend to mere insults, indignities, threats, annoyances, petty oppressions or other trivialities•Schmitz’s “gruff,” “abrupt,” and “intimidating” conduct was not “exceeding all bounds of that tolerated civilized community.”•Criticism he made related to store’s operations & Lawler’s performance.•He was inconsiderate and insensitive in communicating dissatisfaction. •However, the alleged emotional distress is not “severe.”•Injuries manifested as “anxiety, sleeplessness, upset stomach and muscle twitches –do not rise to “severe” level.•Affirmed District Court’s summary judgment for defendants.
INVASION OF PRIVACY•Infringement of a person’s right of solitude and freedom from unwarranted public exposure•Use of a person’s name or picture without permission•Intrusion on solitude (i.e. wiretap; hacking into a computer)•Placing a person in false light (publishing a false story)•Public exposure of private facts (debts, drug use)•Defenses•Right of privacy waivedby public figures, politicians, entertainers, sports personalities, etc.•Information about an individual taken from public files or records
Seki v. Groupon•Groupon did business with Sportations, a GA business.•Sportations provided Groupon customers hot air balloon rides for $139.00 per person•Groupon sold 25 vouchers.•Ended it’s relationship with Sportations with 18 vouchers unused.•Seki’s business goes by name of Magical Adventures Balloon Rides.•Groupon asked him if he was interested in selling rides. He was not.•However, he agreed to give 18 rides to Sportations’ customers and Groupon would pay him for rides.•That was extent of relationship between Magical and Groupon.•Seki learned Groupon featured Magical on its website and was selling vouchers for rides.•Seki demanded Groupon stop. Continued
Seki v. Groupon continued•Seki claimed to lose $140,000 in revenues when Groupon used his company name.•Sued for invasion of privacy.•Trial Court held for Groupon; Seki appealed.•GA law: “the appropriation of another’s name and likeness … without consent and for … financial gain … is a tort.”•It is invasion of privacy.•Rational: Prevent unjust enrichment by theft of good will.•Reversed: Seki is not precluded from pursing a claim for invasion of privacy through misappropriation.
Defamation•Definition: An intentional false communication that injures a person’s or company’s reputation or good name •Elements of the Tort:•False or defamatorystatement•Publishedor communicatedto a third person•Causing harm or injuryto the plaintiff•If person who has false statement said directly to them, then tells a 3rdparty it is “self publication” and no tort.
DefamationDefamation per se: Presumption of harm No proof of harm/injury is necessary.Examples: person has committed a crime; has a sexually communicable disease; or carries out illegal business activities.Workplace Defamation: Damaging information given about job performance or negative information spread about an employee unnecessarily even within a business.
Defenses to Defamation•Truthis a complete defense in some states.•Absolute privilege is an immunity•Legislators in committee sessions•Participants in judicial proceedings•Conditionalprivilege eliminates liability if the false statement was published in good faith.•If there is no malice •In order to protect a person’s legitimate interests•Constitutional privilege•Members of the press may publish “opinion” about public officials, figures, or those of public interest if there is no actual malice.
Chambers v. Travelers•Chambers worked for Travelers from 1987-2008.•Supervised employees (underwriters) who began to file complaints about her.•Human Resources Manager, Cady, investigated complaints as did Chambers’ superior, Werner.•Results were not good.•Chambers was warned about her behavior.Was given specific management issues to address.She was not in agreement.•2 months later, her superior asked her if it was true she took her daughter with her on a business trip. Said yes but did not admit took grandson too.•When facts came to light, she was fired.•Chambers sued for defamation.•District Court held for Travelers. She appealed..
Chambers v. Travelers cont.•Defamation under Minnesota laws requires defamatory statement(1) communicatedto someone other than plaintiff(2) false(3) tended to harmplaintiff’s reputation in the estimation of the community•Defendant may be entitled to “qualified privilege”that defeats the claim•If statement was “made upon proper occasion, for proper motive and based upon reasonable or probable cause”•Complaints to Cady gave Travelers reasonable grounds to investigate Cady surveyed staff; reported concerns expressed about Chambers’performance to supervisor WernerWerner then summarized negative comments to Chambers–sought her response•Communications in a company during investigation or punishing employee misconduct are made upon a proper occasion and for proper purpose•Employer has an interest in protecting itself and public against dishonest or harmful employees•Qualified privilege is not abused if no malice; here, no actual malice•Affirmed: Travelers was entitled to the qualified privilege as a matter of law.•Statements made by Travelers agents were entitled to a “qualified privilege.”
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