CANADIAN BUSINESS LAW ARTICLE ASSIGNMENT
PURPOSE
The purpose of this assignment is to develop students' understanding of significant issues in Canadian business law and to further their research and analytical skills. Students will select and analyze one current article on an important topic in Canadian business law.
SELECTION OF ARTICLE
Students are required to select ONE significant article related to an issue covered in this course. Avoid selecting a short article; try to find a lengthy one with considerable legal content and discussion. The article must relate to a particular Canadian law or a significant Canadian legal case. All articles must be related to Canadian business law. Criminal law articles that are not directly related to business issues will not be accepted. I WILL ONLY ACCEPT ARTICLES WRITTEN AFTER AUGUST 6, 2015. ANY ARTICLE WRITTEN BEFORE THAT DATE WILL BE REJECTED. Relevant topics for this course would include:
0. negligence (manufacturer's or government negligence)
1. defamation (a libel or slander case)
2. employment law, wrongful dismissal case
3. patent, trademark or copyright laws
4. white collar crimes such as fraud or insider trading
5. computer crimes or privacy law issues
6. bankruptcy law issues or a major bankruptcy case
7. shareholders' rights
8. the impact of taxation laws on Canadian business
9. WSIB or workers compensation issues
This is not an exhaustive list of topics. If you select an article on a topic not listed above, obtain your professor's approval before submitting it. The article must be selected from current newspapers, the Internet, magazines or journals. Some of the best sources you can use are; Lawyers Weekly, Canadian Lawyer, Canadian Employment Law Today and the accounting magazines, all of which are available in the Seneca resource centre. You should use the extensive research resources available through the Seneca resource centre. The article must contain significant information or commentary on a key topic in Canadian business law. Do not submit an article on a routine event of minor significance or it will be rejected. Your professor should pre-screen the articles to determine if you have selected a relevant and appropriate article.
Students are to select their OWN article and should not lend their article to other students. If too many students submit the same article, the article will be rejected and the students will be required to find replacement articles. Cheating and plagiarism will not be tolerated and the appropriate college penalties will be applied. It will appear on your transcript that you have been found in violation of Seneca's Academic Policy section on cheating and plagiarism. DO NOT COPY THE ARTICLE. You must summarize the article in your OWN words.
Sometimes students find multiple articles on the same topic. You should select the one best article you find on this topic. Do not hand in more than one actual article. If you use key information from another article that is allowed, but you must then list these others sources for that information at the end of the paper. It is not necessary to use other sources than the article you have chosen, but if you do use actual key information from another source, reference it at the end of the paper in an appropriate format. I want most of your information to come from the actual article you selected. This is not an assignment that requires multiple research sources.
Students MUST include a copy of the actual article you selected so the professor can properly evaluate the analysis. The source, date, page number or URL of the article MUST be provided. All assignments must be produced on a computer or they will not be accepted.
SUMMARY AND ANALYSIS
Your assignment should first contain a short introductory paragraph of 1-2 sentences telling the reader what this article is generally about. Then you do a summary of the key facts discussed, the significance of the events discussed, and the author's position (if there is one). DO NOT just copy the article, you must summarize the key information in your OWN words. After the summary, students must then do an analysis of the article with your own comments and opinions and explain its significance and apply the relevant Canadian business law. Your own analysis and insights are the most important aspect of this assignment.
The completed assignment should be approximately 2-3 typed double spaced pages, but this could be longer depending on the length of the original article. Please include a cover page with your name and the name of the article and your section. Be sure to attach the actual article you used with your assignment. Staple it all together with 1 staple in the top left corner, and do not use plastic folders.
The assignment will be evaluated on the basis of the significance of the article selected, and the quality of the student's summary and analysis. The assignment must be in proper essay form using correct grammar and spelling. Criteria for the assignment include; quality of the article chosen, clarity and content of the summary, quality of the analysis, relevant observations and opinions, use of course material and the overall effectiveness of the article and the analysis.
Students must submit the assignment at the beginning of class on the due date, and late assignments will be penalized with mark reductions. Students who are having any difficulties with this assignment should contact their instructor as soon as possible. The instructor should pre-approve the article that the student has selected before their assignment is finally submitted.
Sample Article Assignment - Business Law
Sweet news for chocolate lovers: $23M price-fixing settlement offers consumers potential cash compensation
National Post /Canadian Press| September 17, 2013. https://business.financialpost.com/2013/09/17/chocolate-settlement-price-fixing/
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LONDON, Ont. - Four of the largest chocolate producers in Canada have agreed to pay more than $23 million to settle a class-action lawsuit alleging price-fixing and price maintenance in the Canadian market.
The defendants - Cadbury Adams Canada Inc., Hershey Canada Inc., Nestle Canada Inc. and Mars Canada Inc., as well as distributor ITWAL Limited - all deny the allegations.
However, they have settled to avoid the expense, inconvenience and distraction of further protracted litigation, says a statement released Monday by lawyers in the case.
The settlements, which reflect a compromise of disputed claims, have been approved by the courts in Ontario, British Columbia and Quebec as being fair, reasonable and in the best interests of class members, says the release.
It says together the defendants have paid $23.2 million for the benefit of all persons who bought Cadbury, Hershey, Nestle and/or Mars chocolate products in Canada between Feb. 1, 2001 and Dec. 31, 2008.
The release says the courts in Ontario, British Columbia and Quebec have also approved a method for distributing the settlement amounts, less fees and expenses, to consumers and commercial purchasers with chocolate product purchases between Oct. 1, 2005, and September 30, 2007.
It says consumers who purchased at least $1,000 in chocolate products between Oct. 1, 2005, and Sept. 30, 2007, will be eligible to make a claim for direct monetary compensation.
They don't need purchase records in order to make a claim, although consumer claims that are not supported by purchase records are capped at $50. And, says the release, to make up for the fact that not all consumers will have made the threshold level of $1,000, 10% of the available settlement will be distributed to several non-profit organizations to promote competition and consumer education and advocacy in Canada.
The deadline for filing a claim to receive direct compensation is December 15, 2013.
The release says persons who believe they might qualify for direct compensation can obtain more information at .
In June, Hershey Canada Inc. pleaded guilty to its role in fixing the price of chocolate products in Canada and was fined $4-million.
The Competition Bureau said the Mississauga, Ont.,-based company admitted in the Ontario Superior Court of Justice that it conspired, agreed or arranged to fix the price of chocolate confectionery products in Canada in 2007.
The company has also agreed to co-operate with federal prosecutors.
Charges have also been laid against Nestle Canada and two of its former executives; Mars Canada, and national wholesale network ITWAL Ltd., as well as ITWAL's chief executive officer.
Nestle, Mars and Itwal Ltd. have said they intend to defend themselves against the charges. A trial date is set for Oct. 3.
Canadian Press
Chocolate Manufacturers Price-fixing Case
"Sweet news for chocolate lovers:$23M price-fixing settlement offers consumers potential cash compensation." Canadian Press, National Post, September 17, 2013. https://business.financialpost.com/2013/09/17/chocolate-settlement-price-fixing/
This article discusses the illegal price-fixing activities of four of Canada's largest chocolate manufacturers and the settlement that has been reached in a class action against these corporations and other penalties the firms may face.
The federal Competition Bureau charged four of the largest manufacturers of chocolate products in Canada and several of their top executives and a national distributor for violating the Competition Act. The Bureau alleges that the companies were guilty of price-fixing and price maintenance in the Canadian market for the sale of chocolate bars and other chocolate products. The Bureau claims that the companies met and set the prices they would charge for chocolate and as a result of their illegal conspiracy Canadians have paid inflated prices for chocolate products for many years. The Canadian companies involved include; Cadbury, Hershey, Nestle and Mars as well as the distributor ITWAL Limited. ITWAL is a national association of independent distributors. These companies sell many of the most popular chocolate bars sold in Canada including; Crispy Crunch, Aero, Smarties, Twix, Mars, Oh Henry and Dairy Milk. These 4 manufacturers control about 98% of the chocolate sales in Canada which is a billion dollar industry. The Bureau had obtained search warrants and raided the offices of these companies in 2007 and seized documents which it claims supports these charges.
As a result of the Bureau's investigation a separate civil class action lawsuit was started in 2007 based on these allegations. The class action claimed that between February 1, 2001and December 31, 2008 executives for these companies illegally conspired to set the prices they would charge for chocolate products in Canada which resulted in higher prices for retailer and consumer purchasers. The lawsuit claimed that executives for these companies met in coffee shops, restaurants and at conventions where they made these illegal price fixing agreements. The class action was seeking damages in excess of $220 million.
Cadbury and Hershey no longer face the criminal charges of the Bureau. Cadbury confessed first and was given complete immunity. Hershey then followed and admitted its illegal conduct and under the leniency provision of the Competition Act was given a reduced fine of $4 million. Nestle, Mars and ITWAL and their executives have not negotiated any resolution with the Competition Bureau and said they intend to fight the charges in court.
This illegal cartel's activities occurred before the 2010 changes were made to The Competition Act. The charges were laid under the old provisions where it was more difficult to get a conviction and the maximum penalty was a fine of up to $10 million and/or a prison term of up to five years. In 2010 the law was changed and it became easier to get a conviction and the penalties were increased to fines of up to $25 million and/or 14 years in jail.
In the civil class action lawsuit, Hershey, Cadbury, Nestle, Mars and ITWAL agreed on September 16, 2013 to a $23 million settlement for this chocolate price-fixing conspiracy. Since it is a settlement, the defendants did not admit liability and stated that they settled only to avoid the expense and inconvenience of a long civil case. The settlement was approved by the courts and was seen as "being fair, reasonable and in the best interests of the class members."
Any person or company that bought $1,000 in chocolate products between Oct. 1, 2005 and Sept. 30 2007 is eligible for financial compensation. If you do not have any receipts for this period, as is the case for most people, then you will still be entitled to $50. People have until December 2013 to file a claim and a website is provided for the process. People or businesses that want more than $50 must have receipts to justify a larger claim. Since many consumers purchased less than $1,000 worth of chocolate during this time period, but still had to pay inflated prices for their chocolate, the settlement provides for 10% of the settlement amount to be given to non-profit organizations to promote competition and consumer education in Canada.
This case is an interesting look into illegal anti-competitive activities and the penalties that can result in Canada if it is discovered. The chocolate market in Canada is very large. In 2012 the sales in Canada totaled $2.7 billion. (The Motley Fool) When the four leading producers were investigated by the Competition Bureau for illegally fixing, coordinating, maintaining and increasing the price of chocolate, a civil lawsuit also began. The class action was certified and finally in 2013 a $23 million settlement was agreed to.
A $23 million settlement at first looks like a large punishment to these companies, but in reality it is just a minor slap on the wrist. The victims are the retail stores that bought chocolate bars and every person who bought a chocolate bar over this 7 year period, which is almost everybody in the country. Most people don't get receipts when they purchase a chocolate bar, or if they do, they certainly don't save them for 7 years. People also buy lots of chocolate at Christmas, Halloween, Easter and Valentines Day and never save these receipts either. Since most individuals have no receipts the most they will get is $50. They will only get the $50 if they register on a website and fill out a list of questions. In reality, most people won't even be bothered to do this. We have all paid too much for chocolate because these big four have broken the law and fixed the prices, but most won't get any money back. This settlement works out to about $6 million per company, but given they each had almost $4 billion in chocolate sales over this 7 year period, the $6 million they pay in damages is almost a joke. It is not even 1% of the total sales. It is definitely not a deterrent to this type of activity, it is more like a minor cost of doing business. Companies thinking of creating similar illegal schemes won't be scared off by this case.
The average person won't be getting any money back. Stores that were also ripped off may not have their receipts any longer so they can't claim the full amounts they are entitled to. The real winners will be the lawyers who started the class action as they usually get about 25% of the settlement amount which will be about $6 million in this case. As usual in class actions, it's the lawyers who get the most money, not the actual parties that suffered the damages.
As for the criminal penalties that result from this case, so far it is quite pathetic as well. Cadbury got total immunity from criminal penalties because it was the first company to cooperate with the Bureau's investigation and told about the illegal activities. Hershey then followed and confessed and agreed to pay a $4 million fine. It is only Mars and Nestle and ITWAL who have not cut a deal with the Bureau and plan to fight the charges.
None of the executives of Cadbury or Hershey had to face jail time. Two former Nestle presidents and the ITWAL president are facing possible jail sentences of up to 5 years and Nestle, Mars and ITWAL can be fined up to $10 million under the old sections of the Competition Act. Most likely though, none of the executives will go to jail and even if the companies are fined the maximum amount, which probably won't happen, it is still just a minor punishment when sales over this period for each company were over $4 billion.
The purpose of the Competition Act is to encourage and maintain fair competition and provide consumers with competitive prices and products. Unfortunately for consumers, price fixing goes on frequently when there are a small number of powerful suppliers and the companies criminal activities rarely get caught. Even if they are caught, the penalties are so light it does little to discourage this illegal behaviour. If the government wants to send out a message that companies should not break the law it needs to put executives in jail for lengthy prison terms and make the fines a significant percentage of the total sales. If the top executives feared they would actually go to jail and the companies had to pay significant fines, the executives might not come up with these illegal schemes that take advantage of consumers. Until this happens, people will continue to be the victims of greedy corporations and their illegal actions and our Competition Act will remain an ineffective piece of legislation.