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Case Scenario: BUG, INC.

Scenario: BUG, Inc., a company based in Any State, U.S.A., designs, manufactures, and sells electronic recording devises. These devices are used by law enforcement agencies (police, FBI, etc.) to intercept and record sounds and voices. The equipment taps into telephone wires, cell phone transmissions, and picks up sounds and voices through the walls of a house or in open-air locations through the use of a remote microphone. Part of the equipment is driven by software written by BUG employees. BUG has exclusive contracts with most state and federal law enforcement agencies throughout the United States. BUG is thinking about expanding its sales to international markets. Currently, half of its manufacturing plants are in foreign countries and half are in the U.S. The company's logo is a ladybug wearing a set of headphones.
Using the scenario above, give detailed answers to the following questions:

2. Earlier this year, WIRETAP, Inc., a relatively new company trying to compete with BUG, sent an employee to BUG to get a job. BUG, not realizing Steve was an employee of WIRETAP, hired him to work in its research and development department located in Any State, U.S.A. While working at BUG, Steve forwarded any BUG e-mail he received to WIRETAP. This included e-mail between BUG officers (both domestic and abroad) that Steve intercepted using his hacking ability. At the end of each week, Steve met with his boss at WIRETAP and gave him all the information he obtained about the BUG product lines. Discuss in detail what type(s), if any, of civil liability Steve and/or WIRETAP may face if caught.

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Solution Summary

A breach of employment contract is demonstrated.

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First of all Steve did not inform Bug Inc. that he is an employee of Wiretap. This is a breach of employment contract. So Bug Inc. can fire him and sue him for damages. Besides he cannot discuss the company information with someone else unless he has been explicitly ...

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Umut Oltulu, MBA
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  • MBA, Texas A&M University-Kingsville
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