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BUG, Inc. (electronic recording devices): Business Law questions

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BUG, Inc., a company based in the city of Springfield, in the state of Columbia, U.S.A. BUG designs, manufactures, and sells electronic recording devices. 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.

1. The newer devices made by BUG have microchips in them with hard-wired computer code to assist in their fulfillment. This computer code was written by BUG employees. How can BUG prevent its competitors from using its code in their products?

A. Copyright

B. Trademark

C. Patent

D. Trade Secret

2. One of BUG's main competitors is WIRETAP, Inc., a company based in the nearby state of Deseret. A WIRETAP employee used a fake name and applied for a job at BUG. This employee forwarded all of the e-mail he received to WIRETAP's corporate headquarters once a week for six weeks, and at the end of the six week period, he was given access to the special alloy that BUG uses in its devices. He was caught with a photocopy of the alloy's formula and manufacturing method in his briefcase when he left the BUG office. Which causes of action appear likely to succeed in a civil lawsuit by BUG against WIRETAP?

A. Fraud

B. Civil RICO

C. Misappropriation of Trade Secrets

D. All of the above.

3. BUG wants to start marketing its products to the public via the internet. However, another company called "Columbia Cybersquatter Corporation" has already obtained the rights to the web address www.buginc.com. What is the most effective legal cause of action available to BUG to obtain the rights to this website address?

A. Commercial Defamation (or "disparagement")

B. Violation of Trademark

C. Conversion

D. Fraud

4. If the police officer who was injured by the defective earpiece prevails in the lawsuit against BUG, BUG will be obliged to pay which kind of damages to the plaintiff?

A. Punitive damages

B. Consequential damages

C. Compensatory damages

D. Both A and C, but not B.

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"Patent is an intellectual property right relating to inventions - that is, to advances made in a technical field. A patent for an invention is granted..."

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1. Answer: C. Patent


Copyright is the legal right of authors, composers, or publisher to "print" and distribute intellectual and artistic creations.

Trademark is a word, phrase, slogan, design or symbol used to identify goods and distinguish them from competitive products. Trademarks may be registered with the U.S. Patent and Trademark Office, and similar offices worldwide.

Patent is an intellectual property right relating to inventions - that is, to advances made in a technical field. A patent for an invention is granted by the government to the applicant, and gives him the right for a limited period to stop others from making, using or selling the invention without permission.

Trade secret is a device, method or formula that gives one an advantage over the competition and which must ...

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  • MBA, Texas A&M University-Kingsville
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