case study 4 business law
- Key facts are those facts that determine if the principles of law are met. You must demonstrate that you recognize the key facts in this case. List the key facts individually. Do not simply repeat or retype the factual scenario.
- The length of your response has no bearing on your score. There is no minimum or limit, however, most responses will be between two and three substantial pages.
- Your assignment must be prepared using the APA format. See the Student Resources page for more information about APA styling.
Roger is a director of a major car manufacturer. This is one of the few remaining car companies yet to introduce a sport utility vehicle. Roger convinces the board to investigate forming a new division to design, build, and market a sport utility vehicle. Roger also convinces the board that the first sport utility vehicle that the division introduces should be the largest yet sold to the general public.
The board set up a committee to do some research, and this committee hired a marketing consulting firm. The committee and the consulting firm both had a few reservations about such a large vehicle, but the data showed that the market could most likely support it. After much discussion, the board of directors voted in favor of creating the new division and the huge sport utility vehicle as its first product. The vote was 9 to 6 in favor of the plan.
Shortly before this vehicle was introduced, there was a major oil supply disruption that caused the price of crude oil to nearly triple. Few purchasers were found for the huge new sport utility vehicle and the company lost considerable money. A shareholder files suit against Roger claiming he violated his duty to the corporation by convincing the board to build and market the large SUV.
*Discuss Roger’s duties as a director and any defenses he has to the lawsuit.
