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Winter 2015 Bar Question 5

Business Associations


Andy, Ruth, and Molly decided to launch a business called The Batting Average (TBA), which would publish a monthly newsletter with stories about major league baseball players.  Andy, a freelance journalist, was responsible for writing the stories.  Andy conducted all of his business activities via a close corporation called Baseball Stories, Inc., of which he was the only employee.  Ruth was responsible for maintaining TBA’s computerized subscriber lists, mailing the newsletter every month, and billing TBA subscribers.  Molly provided all equipment necessary for TBA.  Andy, Ruth, and Molly expressly agreed to the following:  Molly would have exclusive authority to buy all equipment necessary for TBA; and TBA’s net profits, if any, would be equally divided among Andy, Ruth, and Molly.

Andy subsequently wrote a story in the newsletter stating that Sam, a major league baseball player, had been taking illegal performance-enhancing drugs.  Andy knew that the story was not true, but wrote it because he disliked Sam.  As a result of the story, Sam’s major league contract was terminated.  While writing the story, Andy’s computer failed.    He  bought a new one  for TBA  for  $300  from  The  Computer Store.    The Computer Store sent a bill to Molly, but she refused to pay it.

Sam has sued Andy, Ruth, Molly, TBA, and Baseball Stories, Inc. for libel.

The Computer Store has sued Andy, Ruth, Molly, and TBA for breach of contract.

1.     How is Sam’s suit likely to fare?  Discuss.

2.     How is The Computer Store’s suit likely to fare?  Discuss.

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Business Associations
Question 5, Winter 2014

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