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KT4OIO3ETH|CSANDtAWTUTORIAL NO.8 t4 -LL'aOLL

ETHICS - international business

1 . What are the moral principles that multinational companies need to comply

with host countries ?

2 . Why do these companies must also comply with the laws of hom'e countries ?

3 . To what extent are the culture of host countries be compatible with the

multinational comPanies ?

4 . Do cases ff 434 nos. 3 , 6 and 8

5 . Discuss case ff 538 no. 5

IAW - intellectual Property

1 . Define intellectual ProP"rtY ? o

2 . T he Lanham Act recognises four ( 4 )types of trade marks or trade symbols .

Describe them.

3 . What are the requirements for patents to be registrable ?

4 . Describe the different types of patents ?

5 . Do case studies ff 1.013 nos. jZf and ff1014 nos . 8 , 9 and 12 .

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mative action program that might work in any business.

How does business ethics differ from bioethics and other specific ethicalareas?

List in detail what you feel are the rights and obligations in businessactivities for each of the following groups: business people in general,employers, employees, consumers, and government. Give reasons foryour answer.

Analyze, in detail several advertisements in any of the communicationsmedia (newspapers, magazines, radio, TV) and show the degree towhich they tell the truth, misrepresent a product or service, warn thepublic of dangers, omit important information, or make unsupportedand unsupportable claims.

Write an essay discussing the value or lack of value of competition inbusiness and in other specific areas of society-for example sports. Doyou feel that our society places too heavy an emphasis on competition?Why or why not?

To what extent do you feel that government controls and regulations ofbusiness are necessary? Describe in detail some situations in which gov-ernment should intervene and some in which it shouldn't, explainingwhy you feel as you do.

To what extent should business take precedence over the environment,and to what extent should the environment cot1e first? Explain indetail, giving reasons for your answers.

Focus on a specific situation relevant to the business versus environmentissue and analyze what has or hasn't been done to correct the problemsinvolved. Do you agree with what has been done? Why or why not?What's your general blueprint for how to deal with environmentalproblems in business?

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434

affirmative action and reverse discriminatio king this decision, especiallybecause the percentage of minority employees at the center is solow. I feel that the first criteri ng should be that the prospectiveemployee has the quali for the job; once that criterion is met, however,I feel that aflirmati ion should have the greatest influence on the choice, atleast until t io of minorities and women has been raised to an acceptablelevel.

,/CASET6

I feel that every effort should be made by all parties to effect a series of compro-mises that will save the people and the environment, the town, and the com-pany-in that order. I definitely feel that the government, as the representativeof all people, does have a right-indeed, an obligation-to investigate businessesand communities to avoid destruction of the environment. The government'sreport is obviously very important. to everyone in this area, and all partiesshould accept the following as their goals: to clean up the environment as soonas possible; to keep the town economically alive by maintaining the plant, even ifat a reduced capacity until necessary changes can be made; and to allow thecompany to reap a reasonable profit from the plant's operations. Representa-tives of the company, the townspeople and their representatives (mayor, citycouncil), and the federal government should meet together to see what can bedone to accomplish the stated objectives.

The company must be willing to pay its fair share of the costs, but it shouldnot be overburdened. The townspeople must also bear some of the burden, per-haps through higher taxes or the forgoing of raises for workers at the plant forone year. The government should also help financially by offering either low- '

interest government loans or part payment for the changes that the plant mustundergo.

I feel that the mayor would be wrong in entering into collusion with theplant manager to stall environmental changes at the expense of the health andwelfare of the entire community. I believe that the problem ought to be broughtinto the open so that the townspeople can be made aware of it and can helpsolve it in some way. I also feel the company that owns thellant ought to con-sider more than just a loss of profits in its decision making. After all, the com-pany is contributing not only to the economic well-being of a town but also tothe destruction of its environment and the possible ill-health of its people. Thecompany should also consider the goodwill it can gain by maintaining the plant,even if it sustains some loss of profit. Instead of taking the either-or position, thecompany ought to present choices as to whar can be done, and it should ask forhelp and cooperation from all involved parties.

538

0 Moral Protlems in Business (Business Ethics)

Thecompanymust-asmusteveryonewhoisinvolvedinthissi tuat ion-accept. the long-range necessity of protecting and preServing.the environment;

otherwise, there may not be a plant ot *atty pgoPle ut-o1"9 in years to come' I

f".t tt u, il aspects of the situation are important, but I feel that the environ-

*""or aspecr^should be given first priority by all parties. If the plant maintains

ir,,igia ptsition and wilionly take ihe stalling route the-manager has sug-

gest; rc the mayor, I feel that the mayor has no choice but to refuse to go

along with it. .,! |----e?*rupr now that the town is better established, there will be time to encour-

age new les, enui,o,,mdhtally destructive.businesses to Set themselves up in Far-

iiig. r, any case, I feel that a decision to increase the danger to the health and

*.il-b.irrg of the people and the environment would be the wrong decision for

the mayoi to make, even if it is the only way ofsaving the-town economically.

arr., uit, if people have their health and lives, they can still move somewhere

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other jobs; if, on the other hand, they are sick or dying, then the

economicls of the situation definitely becomes unimportant'

CASEiT

I think what happened to the first officer was abominable. Tiue, she made a

iooltsh mistake in t uuing an affair with a higher ranking ofiicer, but she did

ffiilh;, h"l;;;Jh"t ind believed him wlen he said he was divorcing his

ffi. ctrISsL. r"""a out that he was not committed to her and just-wanted to.

;;;; ,.;;tfi"e; having no inrention of divorcing lis y_ire, she had every right

;;;;;["{irrr.X"it uni ro have thatbe the end of it. Nothing she did

l.r.tt.a ,tt. ,r.ur]ue, she received after breaking up with him' Despite an

.rrot i"J"agment, sh\{ould have been left aloni by that t*ttl:it:jl::ll

she wanied io end the adie and in no way should she have received any hara;v

definit\hould have been able to t9l1:t"l,1lTy'T';;l;s h.t poii.. a"ri.', '.f"'6\rwhat

had gone on Yt+ 1-"-:""1i:i:t;:^m."rr,'.rp..iully the,..glu"?, should\e been r-eprimanded, transferred to a

different precinct, "rrip"rlrups

even ae\nqted, iniluding those who did not back

her up when she needed it.

CASE.8

The second officer was certainlf unfairly treated because sex and should

not have been discriminated uiuirrr, because she is female. she-trad successfully\" '

."-pilr.a the diffi cuit trainin[ that qualifrea .h- P,t'h: I:- tlT:}5[$:::*

ilia-;;;JIJh.". been allowed to plrforrnher duties without harassment,

don, or dehumanizirrg lurrg,rage and actions' That she was put in danger of

CHAPTER 50 iu l ' : i leuual pr :o i r t r i , ,r0t3

PR.OtsLEftS

:

l. I(eller, a professor of legai studies at Rhodes Universitv, ,is a diligent instructor. Late one night, while reading a ,/newly published, copyrighted rrearise of 1,g00 pageswritten by Gilbert, he came across a three_page sectiondiscussing the subject matter he intendedto cover inclass the next day. I(eller considered the trearment tobe illuminating and therefore photocopied the threepages and distributed the copies to his class. One ofKeller's students is a second cousin of Gilbert. theauthor of the treatise; and she showEd Gilbert thecopies. Instead o{ being flattered, Giibert sued l(ellerfor copyright infringement. Decision?Jennings conceived a secret process for the continuousfreeze-drying of foodstuffs and related products and 4"constructed a small pilot plant that practiced theprocess. However, Jennings lacked the financing nec_essary to develop the commercial potential of theprocess and, in hopes of obtaining a contract for itsdevelopment and the payment of royalties, disclosed itin confidence to Merrick, a coffee manufacturer, whosigned an agreement not to disclose it to anyone else.At the same time, Jennings signed an agreement not todisclose the process to any other peison as iong asJennings and Merrick were considering a contract forits development. Upon Jennings,s disclosure of theprocess, Merrick became extremely interested andoffered to pay Jennings rhe sum of $ i,zso,Ooo if, uponfurther development, the process proved to bc com_mercially feasible. While negotiations betweenJemings and Merrick were in progress, Nelson, a com_petitor of Merrick, learned of the process andrequested a disclosure from Jennings, who informedNelson that the process could not be disclosed to any_one unless negotiations with Merrick were broken olf.

Stella, a chemist, was employed by Johnson, a manu_facturer, to work on a secret process for Johnson,sproduct under an exclusive three_year conrract.Dabney, a salesman, was employed byJohnson on aweek-to-week basis. Stella and Dabney resigned theiremployment with Johnson and accepted employmentin their respective capacities with Washington, a rivalmanufacturer. Dabney began soliciting pationage fromJohnson's former customers, whose names he hadmemorized. What are the rights of the parties in (a) asuit by Johnson to enjoin Stella from working forWashington, and (b) a suit by Johnson to enioinDabney from soliciting Johnson,s customers?Conrad and Darby were competitors in the business ofdehairing raw cashmere, the fleece of certain Asiaticgoats. Dehairing is the process of separating the com_mercially valuable soft down from the mat;d mass ofraw {leece, which contains long coarse guard hairs andother impurities. Machinery for this process is notreadily available on the open market. Each companyin the business designed and built its own machineryand kept the nature of its process secret. Conrad con_tracted with Lawton, owner of a small machine shop,to build and install new improved dehairing rnachin_ery of increased efficiency for which Conrad furnisheddesigns, drawings, and instructions. Lawton, whoknew that the machinery design was confidential,agreed that he would manufacture the machineryexclusively for Conrad and that he would not repro_duce the machinery or any o{ its essential parts for1"yol: else. Darby purchased from Lawton i copy ofthe dehairing machinery that Conrad had speciallydesigned. Whar are Conrad,s rights against 1ai OarUyand (b) Lawton?Sally, having filed locally an affidavit required underthe assumed name statute, has been operating andadvertising her exclusive toy store for twinty years inCenterville, Illinois. Her advertising has consisted oflarge signs on her premises reading ,,The Toy Mart.,,Bob, after operating a store in Chicago under the name9{

"fne Chicago Toy Mart,,, relocated in Centerville,Illinois, and erected a large sign reading "TOy MART"with the word ,,Centerville,, written underneath insubsrantialiy smaller letters. Thereafter. Sally,s salesdeclined, and many o{ Sally,s customers paironizedBob's srore, thinking it to be a branch of Silly,s busi_ness. What are the righrs of the parties?Ryan Corporation manufactures and sells a variety ofhousehold cleaning products in interstate commerce.On national television, Ryan falsely advertises that itslaundry liquid is biodegradable. Hai Ryan violated theLanham Act?

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Nelson offered to pay Jennings $2,500,000 for.rhe ,tprocess, provided it met certain defined obiective orr- /formance criteria. A contract

-u, pr"pu..i and exe_

cuted between Jennings and Nelson on this basis,without any prior disclosure of the process to Nelson.Upon the making of this contract, Jennings reledtedMerrick's o{fer. The process was thereupon disclosed toNeison. and demonstrarion runs of the pilot plant inthe presence of Nelson representatives were conductedunder varying conditions. After three weeks of exper_imental demonstrations, compiling data, and analyiingresults, Nelson informed Jennings that the process didnot meet the performance criteria in the contract andthat for this reason Nelson was rejecting the process. 6.TWo years later, Nelson placed on the markei freeze_dried coffee that resembled in color, appearance, andtexture the product of Jennings's pilot plant. WhAt arethe rights of the parties?

a

Gibbons, Inc. and Marvin Corporation are manufac-turers who sell a variety o{ household cleaning prod-ucts in interstate commerce. On national televisionGibbons states that its laundry liquid is biodegradableand that Marvin's is not. In {act, both products arebiodegradable. Has Gibbons violated the Lanham Act?George McCoy of Florida has been manufacturing anddistributing a cheesecake for over {ive years, labelinghis product with a picture of a cheesecake, whichserves as a background for a Florida bathing beautyand under which is written the slogan "McCoy AllSpice Florida Cheese Cake." George McCoy has notregistered his trademark. Subsequently, Leo McCoy ofCalifornia begins manufacturing a similar product onthe West Coast using a label similar in appearance tothat of George McCoy, containing a picture of aHollywood star and the words "McCoy's All SpiceCheese Cake." Leo McCoy begins marketing his prod-ucts in the eastern United States, using labeis with theword "Florida" added, as in George McCoy's label. LeoMcCoy has registered his product under the FederalTrademark Act. To what relief, if any, is George McCoyentitled?

p" Sony Corporation manufactured and sold home video/ recorders, specifically Betamax videotape recorders

(VTRs). Universal City Studios, Inc. (Universal) ownedthe copyrights on some programs aired on commer-cially sponsored television. Individual Betamax own-ers frequently used the device to record some ofUniversal's copyrighted television programs for theirown noncommercial use. Universal brought suit,ciaiming that the sale of the Betamax VTRs to the gen-eral public violated its rights under the Copyright Act.It sought no relief against any Betamax consumer.Instead, Universal sued Sony for contributory infringe-ment of its copyrights, seeking money damages, anequitable accounting of profits, and an injunctionagainst the manufacture and sale of Betamax VTRs.Decision?

1*. The Coca-Cola Company manufactures a carbonatedbeverage, Coke, made from coca leaves and cola nuts.The Koke Company of America introduced into thebeveiage market a similar product named Koke. TheCoca-Cola Company brought a trademark infringe-ment action against l(oke. Coke claimed unfair com-petition within the beverage business due to Koke'simitation of the Coca-Cola product and I(oke's attempt

pART XI pioperrv

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the benefit of consumer identification with theCoke name. Decision?

ii. Vuitton, a French corporation, manufactures high-quality handbags, luggage, and accessories. (16rynHandbags, a New York corporation, manufactures anddistributes ladies' handbags. Vuitton handbags are soldexclusively in expensive department stores, and distri_bution is strictly controlled to maintain a certain retailselling price. The Vuitton bags bear a registered trade_mark and a distinctive design. Crown's handbaesappear identical ro the Vuitton bags but are of inleriorquglity. Vuitton sues Crown {or manufacturing coun-terTeit handbags and seliing them at a discount.Decision?

12. T.G.I. Friday's, a New York corporation and registered/ service mark, entered into an exclusive licensing

agreement with Tiffany & Co. that allowed Ti{fany toopen a Friday's restaurant in Jackson, Mississippi.Internationai Restaurant Group, operated by the own-ers of Tiffany, applied for a license to open a Friday's inBaton Rouge, Louisiana, but was refused. In BatonRouge, International then opened a restaurant, calledE.L. Saturday's, or Ever Lovin' Saturday's, which hadthe same type of menu and decor as Friday's. Friday'ssues International for trademark infringement.Decision?

tr3. As part o{ its business, ICnko's Graphics Corporation(ICnko's) copied excerpts from books, compiled themin "packets." and soid the packets to college students.Kinko's did this without permission {rom the ownersof the copyrights to the books and without paylngcopyright fees or royalties. Kinko's has over 200 storesnationwide and reported $I5 million in assets and $3million in profits for 1989. Basic Books, Harper 6 RowJohn Wiley & Sons, and others (plaintiffs) suedIcnko's for violation of the Copyright Act of 1976. Theplaintiffs ovr.ned copyrights to the works copied andsold by Kinko's and derived substantial income fromroyalties. They argued that Kinko's had infringed ontheir copyrights by copying excerpts lrom their booksand selling the copies to college students for profit.

I(nko's admitted that it had copied excerpts withoutpermission a?rd had sold them in packets to students,but it contended that its actions constituted a fair use

of the works in question under the Copyright Act.

Decision?