Question

1. Christina Peterson, Hector Gonzolas, and John Ping are involved in the development and licensing of genetically engineered agricultural products. Unfortunately, it appears as though a competitor has copied some of their work. The competitor alleges that the genetically engineered plans were developed by independent research and not by using any of their work. They decide that it is necessary to protect their rights against the competitor and are considering filing a lawsuit. However, one of the drawbacks of the lawsuit is that the case is extremely complicated and there is a fear that a judge and/or jury will not be familiar enough with the complex issues, nor be able to educate themselves at the trial, in order to arrive at the proper result.

Please define the three (3) major alternative resolution models. Which of these may be the better choice for the plaintiffs and why.

2. Keith Loeb and his wife own stock in Waldbaum, Inc., a publicly traded company in the supermarket business. Robert Chestman is Loeb’s stockbroker. Chestman is aware that Loeb’s wife is the granddaughter of Julia Waldbaum, a member of the board of dierctors of Waldbaum and the wife of its founder. Julia is also the mother of Ira Waldbaum, the president and controlling shareholder of Waldbaum. During a four-year perios, Chestman executed several transactions involving Waldbaum’s stock for Keith Loeb. Subsequently, Ira Waldbaum agreed to sell Waldbaum to a buyer which would result in a stock purchase agreement selling the Waldbaum shares for $50 per share. Ire told three of his children about the pending sale and admonished them to keep the news quiet until a public announcement. He alos told his sister, Shirley Witkin, about the sale and cautioned her not to discuss it because it was to remain confidential. Ignoring that advice, Shirley told her daughter, Susan, that Ira was selling the company. Shirley warned her daughter not to tell anyone except her husband, Keith Loeb, because disclosure could ruin the sale. The next day Susan told Keith about the pending sale, but told him not to tell anyone.

The following day, Keith Loeb says he talked with Chestman and told him that Waldbaum was about to be sold at a substantially higher price than its market value. Loeb asked Chestman what he thought he should do, and Chestman responded that he could not tell Loeb what to do in a situation like this. After the phone call, Chestman bought 3,000 shares of Walbaum at $24.65 per share and purchased an additional 8,000 shares for his clients with 1,000 of those shares going to Keith Loeb.

Did Keith Loeb act ethically with regard to what he told Chestman Did Robert Chestman act ethically with regard to the information he receiver from Loeb? Pick one of the ethical standards offered in the text and show how that standard applies to this situation.

Answer 1

1.

Alternative dispute resolution( ADR) refers to ways of alternative ,that is, other than legal proceedings, settling disputes outside of court. These processes can be used to solve any type of dispute.

Three major resolution alternative models :

• Arbitration: Arbitration includes the help of a neutral third party, it is similar to an informal trial. After hearing each side, the third party issues a decision.The disputing parties may have agreed to be binding or non-binding.When binding, the decision can be enforced by a court and is considered final. Arbiter here is an active facilitator and will pronounce a decision, the arbitration process is still less formal than a trial due to many of the rules of evidence not applying.

• Mediation: At first glance, mediation and arbitration seem similar but one of the main differences is that a mediator, cannot force the parties to agree and is therefore not allowed to decide the outcome of the dispute. The mediator works with the parties to come to a solution made mutually, and the agreements are generally non-binding. Courts can mandate that mediation be required, but the process itself is voluntary, therefore allowing the parties to refuse to come to an agreement.In mediation the parties maintain significant control over the process. Mediation is completely confidential and, since it is non-binding, parties retain the right to pursue litigation following the mediation process.

• Negotiation: This form of ADR is often overlooked. In negotiation, there is no impartial third party to assist the parties in their negotiation, so here the parties work together to come to a compromise. The parties may choose to be represented by their attorneys during negotiations.

- For this case, Negotiation as a alternative resolution will be opportunistic .Since , for a formal trial or even to go through a binding resolution one should a have proper understanding of the plaintiff's work and case ,which in this scenario is not there and therefore would cost their time and money .

In , negotiation they can best represent their work and points and articulate it better to come to a solution or a negotiation .

Live case examples of Negotiation being used as a resolution : Google and the FTC.

2.

• No
• One ethical standard that can be understood from this text is that when Robert Chestman came to knew about the insider information regarding the stock being sold at substantially higher price . His reaction to this was sagacious ,i.e, he simply din't advise Keith Loeb regarding what to do given new piece of information. As to why this was ethically correct and important not to have react was because this was not a first hand information which belonged or concerned to them and therefore it would have been wrong for Robert Chestman to have given advise or to act on, it was a morally incorrect to have done investing based on that.
• Henceforth, this ethical standard counts as to a decency and certainty to do investment and maintain his/her moral code of conduct while performing a job which is very important.