Irac Issue. Rule, Application and Conclusion, Case Study Example

Case 1

In the case of Reed v King, the issue confronting the court was determining Ms Reed’s actual grounds for legitimate grievance regarding her purchase of a home whose violent history had not been made known to her by the seller.  After the purchase, and after having been informed by neighbors that murders had been committed on the property ten years earlier, Ms Reed learned that the appraised value of the home was significantly less than what she had paid, and she consequently felt that Mr. King had not acted in good faith in withholding this information blatantly affecting the worth of the property. It was the court’s function to decide if King’s failure to disclose this history entitles Ms Reed to rescission and damages.

The rule of the law in this case goes to the materiality of such disclosures as made by a seller, in that they are required when the circumstances reflect facts concerning the property tangibly going to its market value, and these facts cannot be known to the buyer save through such disclosure.  Such an instance would be when a seller fails to inform a prospective buyer that the home has an inadequate septic system, the replacement of which would entail great expense for the buyer.  In the King/Reed case, this standard of materiality appears to have dictated the response of the court.  A property’s reputation, unfavorable due to a community stigma attached for a crime committed in the past, was not deemed sufficient cause to award Ms Reed her claim.  Moreover, it appears the court’s application of the law took into consideration potential suits generated by similar, non-material complaints, notwithstanding Ms Reed’s assertion that the poor reputation of the home had a direct impact on its tangible value as real estate.  Nonetheless, the application was guided by direct materiality alone.  In ruling in Ms Reed’s favor, an incalculable array of intangible elements regarding a home’s desirability may well face the courts, so the decision handed down dismissed Ms Reed’s suit.

Case 2

The issue of the case of Cathy and Victor Moseley v the Victoria’s Secret Company is essentially one of dilution.  Here, the court was faced with deciding if the Moseleys’ adult novelty store, named “Victor’s Secret,”  later modified to “Victor’s Little Secret,”  represented a deliberate attempt to capitalize upon, and therefore minimize the integrity, of the Victoria’s Secret brand.  The petitioners maintained that, as they sold a wide variety of novelties and adult items, there could be no valid claim that they were “pirating” the Victoria’s Secret name; the respondents held that the Moseley variation on the brand name would inevitably generate confusion in the public mind, which would damage by dilution the brand identity.

The law in this matter centers on the distinctiveness and familiarity of a brand being such that too near a similarity reflects efforts to create a brand confusion favorable to the petitioners, and one that will dilute the larger brand presence in the market.  This was the crux of the legal issue confronting the court, and the application of the law here took an interesting turn.  Essentially, even though the respondents did not charge the Moseleys with deliberately exploiting the Victoria’s Secret brand, the court applied the law in such a light.  More exactly, commercial dilution was the ostensible issue, even though it appeared unlikely that the Mosesleys’ small business could in any way impact on the international presence of Victoria’s Secret. In this application, the euphemism of “confusion” appears to have taken the place of any charge of outright copyright infringement.  No harm to the Victoria’s Secret Company was established, but the court was swayed by the possibility of such, irrespective of the unlikelihood.  Moreover, and as expressed by the presiding justices, the dilution factor arose from, not competition, but of damage to the Victoria’s Secret name.  This was consequently employed as a basis for ruling in the favor of Victoria’s secret.

Case 3

In the final case, the issue before the court was that of vicarious liability.  Former Burlington employee Kimberly Ellworth sued the company on the basis of sexual harassment, claiming that Ted Slowik, the manager to whom she directly reported, had consistently displayed offensive behavior to her.  Complicating the issue, and significantly going to the vicarious liability core, is that Ms Ellworth never reported Slowik’s unacceptable conduct to anyone in the company, and her resignation made no mention of it as a reason for leaving her job.

The law here is somewhat removed from the statutory, as Ms Ellworth’s complaints of a hostile work environment is not within the Title VII provision, which is concerned with discrimination.  Precedent, however, has altered the parameters of interpretation, and several cases in the 1980s incorporate hostile work environments and sexual harassment claims as viable in a reading of the Title.  This furthered Ms Ellworth’s interests in the court’s application of the law, but only to an extent, and the initial application of the law did not perceive Burlington as liable, vicariously or otherwise, for actions of which it was unaware.  The District Court did find that Slowik’s behavior had created a hostile work environment, but was unwilling to expand the responsibility to the corporate entity.  The Court of Appeals reversed the decision, citing the liability of Burlington as an inevitable factor in the circumstances.  Here, ultimately, the court fixed upon an application literal to the law, in that any supervisor behaving so irresponsibly is a representative of the corporate entity, and becomes the “employer” itself. The ruling then was in favor of Ellworth and acknowledged vicarious liability on Burlington’s part.  Application, however, is also manifested in the judicial dissensions.  Justices Thomas and Scalia note an unrealistic basis for such liability claims, as large businesses cannot reasonably be aware of the behaviors of all of their supervisors.

References

Jennings, Marianne M.  (2010).  Business: Its Legal, Ethical, and Global Environment. Belmont: Cengage Learning.