From: "Marvin Kaye" <marv@lancaironline.net>
Subject: Re: [LML] Re: D2 Update part deux
To: lml
Date: Fri, 05 Jan 2007 11:46:56 -0500
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Posted for "Chuck Jensen" <cjensen@dts9000.com>:

  Brent's multiple posts all focus on the 'legal' obligations of the
  parties, or at least as he perceived them.  That may be fine for the
  court room, but I've not heard the 'moral' and 'market' obligations of
  the players explored.  They are not one and the same, at least among
  responsible parties that value their reputation.
  
  Even the 'legal' obligations are less clear than it may appear, based on
  agency.  Picking up on Brent's use of real world examples, if I go to a
  car dealer and one of his salemen sells me a car, takes my money and
  tells me to pick it up tomorrow.  And I show up tomorrow and the dealer
  says Sid 'Slick" Sailsman got fired yesterday and he never gave me any
  money, so I guess your out of luck.
  
  Not necessarily.  It depends on agency and who was a legal
  representative of whom.  Clearly, the car salesman was an agent of the
  dealer and the dealer is going to have to pay up.  Certainly, it's less
  clear who D2 was an agent of?  Chelton, Crossbow, PinPoint?  In all
  likelihood, Chelton has a signed agreement with D2 (if they had a
  relationship at all?) that says specifically that D2 is not acting as an
  agent of Chelton, hence D2 can not bind or legally obligate Chelton in
  any way or manner.
  
  Is Chelton home free?  Not at all.  The legal burden may well rest with
  Chelton (or whoever) to prove that D2 was not, in effect, acting as
  their agent.  These things are always fact specific, but responsibility
  may well turn on how D2 represented their product.  If there was any
  implication that this is a Chelton product and 'Chelton makes great
  products and so you know they are good' and Chelton did nothing to
  disabuse the market place that 'this is not a Chelton product and
  Chelton neither endorses or supports it', then the slippery slope for
  Chelton may well have started.  In essence, they were enjoying the
  fruits of the market place while shirking liability by attempting to
  hide behind the veil of a second company.
  
  The above example is are not based on fact or legal opinion (though I am
  writing this from my suite at the Holiday Inn).  The players may not
  even be identified correctly, but the point is this is not necessarily
  as straightforward as it first appears.  It not always as simple as A
  gave money to C who gets his product from B, but since B didn't get any
  money from A, then B is free and clear.  Sounds good, but not always
  true.  It depends on what C represented and what B did to ensure
  accuracy of those representations.
  
  Hopefully, someone will step forward and graciously put forward a
  compromise before the food fight starts.
  
  Chuck Jensen