Alex Pappis

Business 85

Professor Dana

5 June, 2019

Major Memo 2: Virtual Predator Protection

Section 1: Contracts

Production and Purchase between Foster and Martin

The first contract that was settled on was an “express contract” between Foster and

Martin. An “express contract” is an exchange between parties of oral or written promises. These

promises can be written or spoken words, or a combination of both, form the contract. When

Foster and Martin exchanged emails agreeing that Martin would produce a product for Foster,

and that Foster would purchase that product for a price of $5,000, they engaged in an express

contract due to the fact that written promises were made. The general purpose of this is to agree

upon the production of Foster’s personal product, as well as Martin’s compensation and payment

for producing the product.

Foster, Jones, and Wilmont form an LLC

Another contract that should be formed in the fact pattern is between Dora and her two

friends, Stella Jones and Lucas Wilmont, about forming a business to mass produce and sell the

device for commercial purposes. A contract between these three investors would be necessary as

the three decided on starting a Limited Liability Corporation (LLC). An LLC is a hybrid business

entity that blends elements of a partnership and corporate structures. To form their LLC, the three
investors would need to complete formation requirements, prepare operating agreements, file a

statement of information within 90 days of registration, and draft a contract between the three of

them. The general purpose of this contract would be to clarify specifically who is completing

certain roles within the LLC, how much money they would be receiving from profits and/or

salaries. In addition, the contract should clarify the specific amount of money each member will

invest. This will also ensure liability for those amounts for each person due to the fact that in

LLC’s, each investor is liable for the amount that they actually invest into the LLC. Lastly, the

contract should include any other important agreements the partners wish to include about the

running of the company.

David Martin and Virtual Predator Protection

Another contract that should be formed is between David Martin and Virtual

Predator Protection LLC. The owners of the LLC, Dora Foster, Stella Jones and Lucas Wilmont,

had agreed that they want to hire David Martin as an independent contractor. They would need to

draft a contract that Martin would agree with to make this happen. The general purpose of this

contract would be to ensure that David Martin completes work for the LLC, but in exchange, has

his needs and wants satisfied as he has described them to Dora Foster. Because David Martin has

no interest in running the company or maintaining ownership of the technology, there must be

certain specifications in this contract. I would recommend that the contract lay out specifically,

as to abide by the California Supreme Court’s ABC Test, David Martin’s roles within the

company to prove that he is indeed an independent contractor. In addition, I would recommend

that Martin’s salary, Martin having no role in running the business, Martin being able to develop

and improve the technology, as well has health benefit and compensation protection should be

clearly defined within the contract. Lastly, the most important piece of the contract that I would
highly recommend to be added would be that David Martin does not own the rights to the

technology even though he can improve and develop it as he wishes. This is critical due to the

fact that if David owns the technology, he could potentially not allow anyone else in the future to

use it, including VPP. He has stated explicitly that he does not wish to maintain ownership, and

the contract should iron those details out as clearly and explicitly as possible.

Virtual Predator Protection and Laser Creations Unlimited

Another contract that should be formed is between VPP and LCU. The purpose of this

contract would be to ensure that VPP has the rights to use LCU’s hologram technology when

they commercially produce and sell their product. The goal of a contract between these two

parties would be to ensure rights to use LCU’s technology in the VPP products, as well as clearly

define compensation that LCU would demand for the use of their technology. I would

recommend that the contract be very detailed in regards to how VPP can use the technology in

production and selling of their own product, the defined roles of the two companies in terms of

LCU being a supplier of the technology, as well as precise compensation to meet LCU’s demand

for the hologram technology.

Ben Bronson and Virtual Predator Protection

Another contract that should be formed is a contract between Ben Bronson and VPP. VPP

hired Bronson to develop marketing concepts as an employee of the company. In this case, there

should be a contract between VVP and Bronson that makes him an employee and an agent of

VPP. The general purpose of this contract would be to specifically and clearly outline Bronson’s

roles and duties to the company as an agent and employee, as well as how he will be

compensated for his work. I would recommend that the contract specifically define that Bronson
will be hired as an employee and agent of VPP. The nature of Bronson’s work as a marketing

specialist will require that he continually change and improve his strategies to best market the

InstaGrizzly One. Such a worker should be regarded as an employee, as it is not one single job

but rather an ongoing one. As an employee, Ben would work for pay and be subject to the control

of VPP. In regards to Bronson being an agent of the company in addition to an employee, the

contract would have to include that Bronson be defined as an agent so that he can act on behalf

of VPP and implement what he deems the best possible marketing strategy. I would also

recommend that this contract should clearly define items such as annual salary and health

benefits. The contract should also include that VPP has the rights to use Ben’s marketing

strategies, logos, websites, advertisements, and videos. As an employee and agent, the contract

should outline that Ben may act on behalf of and is subject to the control of VPP so that he may

complete his duties to VPP to the best of his abilities.

Julie Nguyen and Virtual Predator Protection

Another contact that should be formed is a contract between Julie Nguyen and VPP.

Bronson suggested to VPP that they hire Nguyen as a sales representative to market and sell the

InstaGrizzly One to retailers around the country. The general purpose of this contract would be to

specifically define Nguyen’s role in the company as an employee and agent, rather than an

independent contractor as well as detail her compensation for her work. I would recommend that

the contract clearly define that Nguyen will be paid an annual salary, receive health benefits, and

receive commission on her sales. The percentage of her commission should be discussed

between the two parties and clearly defined within the contract. I would also recommend that

Nguyen be hired as an employee and agent of the company rather than an independent contractor

due to the nature of what work she will be doing for VPP. Because she will continually be
evolving her marketing strategies to sell the product, as well as marketing, selling and dealing

with other third parties, she should be hired as an employee and agent. As an employee, Nguyen

would work for pay and commission, as well be subject to the control of VPP. As an agent, she

would be allowed to act on behalf of VPP in terms of marketing and selling the InstaGrizzly One

to retailers around the country. Hiring her as an employee and agent in the contract would be

advantageous as it would clearly define Nguyen’s role and allow her to fulfil her duties as an

employee to the best of her abilities.

Section 2: Intellectual Property

VPP’s InstaGrizzly One

The first piece of intellectual property that would need protection would be the

technology in the InstaGrizzly One. VPP would most certainly want to obtain a patent. Patents

grant the holder exclusive rights to produce, sell and use a product, process, invention, or

asexually reproduced plant for 20 years. This is extremely critical for VPP to take care of due to

the fact that if anyone else were to create a similar product and file for a patent before VPP, they

would not be able to produce or sell the InstaGrizzly One. This is essential to the purpose of the

entire hypothetical fact form because Dora Foster would not be able to do what she wanted to if

this were the case. To obtain the patent over the InstaGrizzly One, VPP would first need to

contact an attorney that is licensed to practice in the Patent Office. Once that is taken care of, the

attorney would then ensure that no other patent or similar patents exist. The application can then

be filed with the Patent Office, and will eventually be issued if all of the previous criteria have

been met. VPP must ensure that no infringements take place, or they could lose the patent. The

patent that VPP should attempt to obtain should be one of federal level, as they would then have
control over the InstaGrizzly One throughout the country. This patent must be registered with the

USPTO.

VPP’s Trade Secrets

Trade secrets are defined as a process, product, method of operation, or compilation of

information used in a business, unknown to the public. Within the hypothetical fact form, there

are certainly considered as trade secrets, mainly Ben Bronson’s marketing strategies and the

process by which the InstaGrizzly One and the technology it contains is produced. These

strategies and processes must be protected. The statutory law within California underneath the

Uniform Trade Secret Act accompanied with the Defend Trade Secrets Act of 2016 will ensure

that these processes and strategies are protected from the public so that they can not be unfairly

or illegally replicated. VPP, to ensure these secrets are kept, would inform their employees about

what information they need to keep confidential, and then require those employees to sign a

confidentiality agreement. VPP would then outline in those agreements how the classified

information should be treated. By going through this process, VPP would then have safeguarded

themselves from losing their trade secrets. If in the event that the secrets were made public,

under the Economic Espionage Act, the leaker of the information would be subject to up to five

million dollars in fines, as well as a maximum of a ten-year prison sentence. VPP certainly

should take the time to protect their secrets.

Logos and Name

VPP should also take the time to protect their rights to their company name and logos.

The name, “Virtual Predator Protection” as well as whatever logo(s) that Ben Bronson comes up

with should be trademarked by VPP. Trademarks are distinctive marks, words, designs, pictures,
or arrangements used to identify the source of goods and services as well as distinguish them

from goods and services of another party. VPP should file for a Federally registered trademark

with the USPTO as to ensure maximum national protection over their name and logos. VPP will

be able to do this as long as their name and logo(s) are not deemed generic, merely descriptive,

immoral, deceptive, name a person without permission, or substantially similar to another

trademark. This is something that Ben Bronson should be aware of when designing the

company’s logo(s) as to ensure that they can actually be trademarked. Similar to the product, I

recommend that VPP take steps to trademark these things as soon as possible as to ensure that no

one else uses their ideas.

Ben Bronson’s Website, Written Advertisements, and Viral Video

VPP should also take action to copyright some of the work that Ben Bronson has

completed for them. Bronson created a website, written advertisements, as well as a viral video

that were all used in the promotion of the InstaGrizzly One. A copyright is the exclusive legal

right to reproduce, publish, and sell the fixed form of an expression of an original creative idea.

A copyright can be placed upon literary and musical works, dramatic works as well as

pantomimes and choreographic works. In addition, pictorial and sculptural works, along with

motion pictures, audiovisual works, sound recordings, architectural works and even computer

software. Due to the fact that the advertisements, websites as well as videos could all be

considered the expression of original and creative ideas, and can fall under a number of the

previous categories such as literary works, computer software and audiovisual works, VPP

should pursue copyrights. To do so, VPP needs to file a form with the Register of Copyright

which heads the U.S. Copyright Office. From there, the copyright would be attached to the works

at the time that they were originally created. VPP would then need to provide two copies of the
copyrighted materials to the Library of Congress. Doing so would eliminate any worry of anyone

else illegally using their website, videos or advertisements illegally.