Napster, Inc., offered a service that allowed its users to browse digital music files on other users' computers and download selections for free. Music industry principals sued Napster for copyright infringement, and the court ordered Napster to remove files that were identified as infringing from its service. When Napster failed to comply, it was shut down.

A few months later, Bertelsmann, a German corporation, loaned Napster $85 million to fund its anticipated transition to a licensed digital music distribution system. The terms allowed Napster to spend the loan on "general, administrative and overhead expenses." In an e-mail, Napster's chief executive officer referred to a "side deal" under which Napster could use up to$10 million of the loan to pay litigation expenses. Napster failed to launch the new system before declaring bankruptcy. A group of song writers and music publishers filed a suit against Bertelsmann, alleging that its loan had prolonged Napster's infringement. The plaintiffs asked the court to order the disclosure of all of Bertelsmann's attorney-client communications related to the loan. (See Confidentiality and Privilege.)

(a) The first group will identify the principle that Bertelsmann could assert to protect these communications and outline the purpose of this protection.

(b) The second group will decide whether this principle should protect a client who consults an attorney for advice that will help the client commit fraud.

(c) A third group will determine whether the court should grant the plaintiffs' request.

Holder in Due Course. Through negotiation, Emilio has received from dishonest payees two checks with the following histories:

(a) The drawer issued a check to the payee for $\$ 9$. The payee cleverly altered the numeral amount on the check from $\$ 9$ to $\$ 90$ and the written word from "nine" to "ninety."

(b) The drawer issued a check to the payee without filling in the amount. The drawer authorized the payee to fill in the amount for no more than $\$ 90$. The payee filled in the amount of $\$ 900$.

Discuss whether Emilio, by giving value to the payees, can qualify as a holder in due course of these checks. (See Holder in Due Course.)

What evidence did the plaintiff offer to establish standing to enforce the note? Was this sufficient proof? Explain.

Intestacy Laws. Three and a half years after Lauren and Warren Woodward were married, they were informed that Warren had leukemia. At the time, the couple had no children, and physicians told the Woodwards that the leukemia treatment might leave Warren sterile. The couple arranged for Warren's sperm to be collected and placed in a sperm bank for later use. Two years after Warren died, Lauren gave birth to twin girls who had been conceived through artificial insemination using his sperm. The following year, Lauren applied for Social Security survivor benefits for the two children. Her application was rejected on the ground that she had not established that the twins were the husband's children within the meaning of the Social Security Act. Woodward then filed a paternity action in Massachusetts, and the probate court determined that Warren Woodward was the twins' father. She then filed an action in court to determine the inheritance rights of the twins. (See Intestacy Laws.)

(a) The first group will outline how a court should decide the inheritance rights of children conceived from the sperm of a deceased individual and his surviving spouse.

(b) The second group will decide if children conceived after a parent's death (by means of artificial insemination or in vitro fertilization) still inherit under intestate succession laws, and will explain why or why not.

(c) The third group will consider the inheritance rights of a child who was conceived by means of artificial insemination, in vitro fertilization, or a surrogate. Should they be different from the rights of a child conceived in the traditional manner? Assuming the biological parent is not part of the child's life, should the child still be able to inherit from the biological parent? Why or why not?

Adverse Possession. The Wallen family owned a cabin on Lummi Island in the state of Washington. A driveway ran from the cabin across their property to South Nugent Road. Floyd Massey bought the adjacent lot and built a cabin on it in $1980$. To gain access to his property, Massey used a bulldozer to extend the driveway, without the Wallens' permission but also without their objection. Twenty-five years later, the Wallens sold their property to Wright Fish Company. Massey continued to use and maintain the driveway without permission or objection. Later, Massey sold his property to Robert Drake. Drake and his employees continued to use and maintain the driveway without permission or objection, although Drake knew it was located permission or objection, although Drake knew it was located largely on Wright's property. Still later, Wright sold its lot to Robert Smersh. The next year, Smersh told Drake to stop using the driveway. Drake filed a suit against Smersh, claiming adverse possession.

(a) The first group will decide whether Drake's use of the driveway meets all of the requirements for adverse possession.

(b) The second group will determine how the court should rule in this case and why. Does it matter that Drake knew the driveway was located largely on Wright's (and then Smersh's) property? Should it matter? Why or why not?

(c) A third group will evaluate the underlying policy and fairness of adverse possession laws. Should the law reward persons who take possession of someone else's land for their own use? Does it make sense to punish owners who allow someone else to use their land without complaint? Explain.

(d) The fourth group will consider how the laws governing adverse possession vary from state to state. To acquire title through adverse possession, a person might be required to possess the property for five years in one state, for instance, and for twenty years in another. Are there any legitimate reasons for such regional differences? Would it be better if all states had the same requirements? Explain your answers.

Insurance Coverage. PAJ, Inc., a jewelry company, had a commercial general liability (CGL) policy from Hanover Insurance Company. The policy required PAJ to notify Hanover of any claim or suit against PAJ "as soon as practicable." Yurman Designs sued PAJ for copyright infringement because of the design of a particular jewelry line. Because PAJ did not realize that the CGL policy had a clause that covered infringement claims, it did not notify Hanover of the suit until four to six months after litigation began. Hanover contended that the policy did not apply to this incident because the late notification had violated its terms. PAJ sued Hanover, seeking a declaration that it was obligated to defend and indemnify (reimburse) PAJ for any loss resulting from the infringement claim. (See The Insurance Contract.)

(a) The first group will decide whether Hanover had an obligation to provide PAJ with legal assistance.

(b) The second group will determine the effect that PAJ's late notice to the insurance company had on its ability to provide assistance and mount a defense. Should the court require the insurance company to indemnify PAJ in this situation? Why or why not?

A Question of Ethics-The IDDR Approach and Discharge by Operation of Law. Lisa Goldstein reserved space for a marriage ceremony in a building owned by Orensanz Events, LLC, in New York City. The rental agreement provided that on cancellation of the event "for any reason beyond Owner's control," the client's sole remedy was another date for the event or a refund. Shortly before the wedding, the New York City Department of Buildings found Orensanz's building to be structurally unstable and ordered it vacated. The owner closed it and told Goldstein to find another venue. She filed a suit in a New York state court against Orensanz for breach of contract, arguing that the city's order had been for a cause within the defendant's control.

(a) Is the owner of a commercial building ethically obligated to keep it structurally sound? Apply the IDDR approach in the context of the Goldstein case to answer this question.

(b) Is a contracting party ethically obligated to "relax" the terms of the deal if the other party encounters "trouble" in performing them? Discuss.

In Richland, Washington, Robert Ingersoll planned his wedding to include about a hundred guests, a photographer, a caterer, a wedding cake, and flowers. Ingersoll had been a customer of Arlene's Flowers and Gifts for more than nine years and had spent several thousand dollars at the shop. When he approached Arlene's owner, Baronelle Stutzman, to buy flowers for his wedding, she refused because Ingersoll and his fiancé, Curt Freed, were a same-sex couple. Deeply offended, Ingersoll and Freed dropped their wedding plans and married in a modest ceremony.

(a) Federal and state laws attempt to protect consumers from unfair trade practices, including discriminatory requirements, related to consumer transactions. Using the Review step of the IDDR approach, consider whether it would be ethically fair to hold Stutzman personally liable for a violation of these laws.

(b) Using the Discussion step of the IDDR approach, consider actions that Ingersoll and Freed as consumers might take in response to Arlene's-Stutzman's-discriminatory rejection of their offer to do business.

On learning that Sébastien planned to travel abroad, Roslyn asked him to deliver $25,000 in cash to her family in Mexico. During a customs inspection at the border, Sébastien told the customs inspector that he carried less than$10,000. The officer discovered the actual amount of cash that Sébastien was carrying, seized it, and arrested Sebastien. Roslyn asked the government to return what she claimed were her funds, arguing that the arrangement with Sébastien was a bailment and that she still held title to the cash. (See Bailments.)

(a) The first group will argue that Roslyn is entitled to the cash.

(b) The second group will take the position of the government and develop an argument that Roslyn's agreement with Sébastien does not qualify as a bailment.

(c) The third group will assume that a bailment was created, identify what type of bailment it was, and explain the degree of care required of the bailee.

Signature Liability. Guillermo and Guadalupe Albarran and their sons, Ruben and Rolando, owned R. Cleaning Impact, Inc. (RCI). Neresh Kumar owned Amba II, Inc., a check-cashing business. The Albarrans cashed checks through Amba on a regular basis, often delivering a stack of employee paychecks to Amba for cashing. Later, the Albarrans' bank refused payment on some of the checks. Kumar learned that some of these items were payable to fictitious payees with fictitious addresses. Others had been filled out for amounts greater than real employees' pay. Meanwhile, RCI became insolvent and closed its account, and Guillermo and Guadalupe filed for bankruptcy. Amba was left with many unpaid checks. Among these parties, who can be held liable for the loss on the unpaid checks? Explain.

How is Congress structured and organized?

Napster, Inc., offered a service that allowed its users to browse digital music files on other users’ computers and download selections for free. Music industry principals sued Napster for copyright infringement, and the court ordered Napster to remove from its service files that were identified as infringing. When Napster failed to comply, it was shut down. A few months later, Bertelsmann, a German corporation, loaned Napster $85 million to fund its anticipated transition to a licensed digital music distribution system. The terms allowed Napster to spend the loan on “general, administrative and overhead expenses.” In an e-mail, Napster’s chief executive officer referred to a “side deal” under which Napster could use up to$10 million of the loan to pay litigation expenses. Napster failed to launch the new system before declaring bankruptcy. The plaintiffs filed a suit against Bertelsmann, alleging that its loan had prolonged Napster’s infringement. The plaintiffs asked the court to order the disclosure of all attorney-client communications related to the loan.

(c) A third group will determine whether the court should grant the plaintiffs’ request.

Draw a political cartoon that could have appeared in a colonial newspaper.

Residents of the city of Madison, Wisconsin, became concerned about overconsumption of liquor near the campus of the University of Wisconsin (UW). The city initiated a new policy, imposing conditions on area bars to discourage reduced-price "specials" that were believed to encourage high-volume and dangerous drinking. Later, the city began to draft an ordinance to ban all drink specials. Bar owners responded by announcing that they had "voluntarily" agreed to discontinue drink specials on Friday and Saturday nights after $8:00$ P.M. The city put its ordinance on hold. Several UW students filed a lawsuit against the local bar owners' association, alleging violations of antitrust law.

(a) The first group will identify the grounds on which the plaintiffs might base their claim for relief and formulate an argument on behalf of the plaintiffs.

(b) The second group will determine whether the defendants are exempt from the antitrust laws.

(c) The third group will decide how the court should rule in this dispute and provide reasons for the ruling.