Business Law Today Standard Text & Summarized Cases 10th Edition by Roger LeRoy Miller – Test Bank

 

Instant Download – Complete Test Bank With Answers

 

 

Sample Questions Are Posted Below

 

Chapter 5

 

 

Intellectual Property

and Internet Law

 

 

 

N.B.:  TYPE indicates that a question is new, modified, or unchanged, as follows.   N      A question new to this edition of the Test Bank. =       A question modified from the previous edition of the Test Bank, =       A question included in the previous edition of the Test Bank.

 

true/false questions

 

1. The need to protect intellectual property is recognized in the Declaration of Independence.

 

ANSWER:         F                               PAGE:        126                           TYPE:         N

BUSPROG: Analytic                    LO: 5-1                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

2. A patent and a copyright are examples of intellectual property, but a trademark is not an example of intellectual property.

 

ANSWER:         F                               PAGE:        127                           TYPE:         N

BUSPROG: Analytic                    LO: 5-1                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

3. A beverage company that competes with Coca-Cola Company cannot call its products “Koke.”

 

ANSWER:         T                               PAGE:        127                           TYPE:         N

BUSPROG: Reflective                 LO: 5-2                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

4. The 1995 Federal Trademark Dilution Act allowed trademark owners to bring suit in federal court for trademark dilution.

 

ANSWER:         T                               PAGE:        128                           TYPE:         N

BUSPROG: Analytic                    LO: 5-2                Bloom’s: Knowledge

Dif: Moderate                                                       AICPA: BB-Legal

 

5. A trademark can be diluted by the use of a similar mark.

 

ANSWER:         T                               PAGE:        128                           TYPE:         N

BUSPROG: Analytic                    LO: 5-2                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

6. A trademark does not need to be registered to support a trademark infringement action.

 

ANSWER:         T                               PAGE:        129                           TYPE:         +

BUSPROG: Analytic                    LO: 5-2                Bloom’s: Comprehension

Dif: Easy                                                       AICPA: BB-Legal

 

7. The states and the federal government provide for the registration of trademarks.

 

ANSWER:         T                               PAGE:        129                           TYPE:         N

BUSPROG: Reflective                 LO: 5-2                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

8. A fanciful use of ordinary words may be trademarked.

 

ANSWER:         T                               PAGE:        130                           TYPE:         =

BUSPROG: Reflective                 LO: 5-2                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Legal

 

9. A suggestive use of ordinary words may be trademarked.

 

            ANSWER:         T                               PAGE:        131                           TYPE:         +

BUSPROG: Reflective                 LO: 5-2                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Legal

 

10. A generic term is not protected under trademark law unless it acquires a secondary meaning.

 

ANSWER:         F                               PAGE:        132                           TYPE:         =

BUSPROG: Reflective                 LO: 5-2                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Legal

 

11. A service mark distinguishes products used, or “put into service,” by the government.

 

            ANSWER:         F                               PAGE:        132                           TYPE:         =

BUSPROG: Reflective                 LO: 5-2                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

12. A certification mark distinguishes products approved, or “certified,” by the government.

 

ANSWER:         F                               PAGE:        132                           TYPE:         =

BUSPROG: Reflective                 LO: 5-2                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

13. It is estimated that over 70 percent of the goods imported to the United States are counterfeit.

 

ANSWER:         F                               PAGE:        133                           TYPE:         N

BUSPROG: Analytic                    LO: 5-2                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

14. Trade names have the same legal protection as trademarks.

 

answer:         t                               PAGE:        134                           TYPE:         N

BUSPROG: Reflective                 LO: 5-2                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

15. A trade name can be protected if it is unusual or fanciful.

 

ANSWER:         T                               PAGE:        134                           TYPE:         N

BUSPROG: Reflective                 LO: 5-2                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

16. A license permits the use of another’s intellectual property for certain limited purposes.

 

ANSWER:         T                               PAGE:        134                           TYPE:         =

BUSPROG: Analytic                    LO: 5-2                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

17. The owner of intellectual property may put restrictions on the use of the intellectual property in a license agreement.

 

ANSWER:         T                               PAGE:        134                           TYPE:         N

BUSPROG: Reflective                 LO: 5-2                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Critical Thinking

 

18. In cyberspace, trademarks are sometimes called cyber marks.

 

ANSWER:         T                               PAGE:        135                           TYPE:         N

BUSPROG: Analytic                    LO: 5-2                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

19. In cyberspace, no two businesses can use the same domain name.

 

ANSWER:         T                               PAGE:        135                           TYPE:         N

BUSPROG: Reflective                 LO: 5-2                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

20. Cybersquatting occurs when a person repeatedly visits a business’s website.

 

ANSWER:         F                               PAGE:        135                           TYPE:         N

BUSPROG: Reflective                 LO: 5-2                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

21. To be patentable, an invention, discovery, or design must be novel, useful and not obvious in light of current technology.

 

ANSWER:         T                               PAGE:        138                           TYPE:         N

BUSPROG: Analytic                    LO: 5-3                Bloom’s: Knowledge

Dif: Moderate                                                       AICPA: BB-Legal

 

22. Patent infringement is a tort.

 

ANSWER:         T                               PAGE:        139                           TYPE:         N

BUSPROG: Reflective                 LO: 5-3                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

23. Foreign firms cannot obtain U.S. patent protection on items that they sell in the United States.

 

ANSWER:         F                               PAGE:        139                           TYPE:         N

BUSPROG: Analytic                    LO: 5-3                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

24. Copyright protection is automatic—registration is not required.

 

answer:         T                               PAGE:        140                           TYPE:         =

BUSPROG: Analytic                    LO: 5-4                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Critical Thinking

 

25. A copyright owner must place a © or an ® on the work to have the work protected from copyright infringement.

 

ANSWER:         F                               PAGE:        140                           TYPE:         N

BUSPROG: Analytic                    LO: 5-4                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

26. It is possible to copyright an idea.

 

ANSWER:         F                               PAGE:        141                           TYPE:         =

BUSPROG: Reflective                 LO: 5-4                Bloom’s: Comprehension

DIF: Easy                                                      AICPA: BB-Critical Thinking

 

27. A copy does not need to be exactly the same as the original to infringe a copyright.

 

ANSWER:         T                               PAGE:        142                           TYPE:         +

BUSPROG: Analytic                    LO: 5-4                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Critical Thinking

 

28. Downloading software or music into a computer’s random access memory without authorization is copyright infringement.

 

ANSWER:         T                               PAGE:        144                           TYPE:         =

BUSPROG: Reflective                 LO: 5-4                Bloom’s: Comprehension

Dif: Easy                                                       AICPA: BB-Legal

 

29. A marketing technique can be a trade secret.

 

ANSWER:         T                               PAGE:        146                           TYPE:         =

BUSPROG: Reflective                 LO: 5-5                Bloom’s: Comprehension

Dif: Easy                                                       AICPA: BB-Legal

 

30. A customer list is not a trade secret.

 

ANSWER:         F                               PAGE:        146                           TYPE:         =

BUSPROG: Reflective                 LO: 5-5                Bloom’s: Comprehension

Dif: Easy                                                       AICPA: BB-Legal

 

31. Pricing information is not a trade secret.

 

ANSWER:         F                               PAGE:        146                           TYPE:         =

BUSPROG: Reflective                 LO: 5-5                Bloom’s: Comprehension

Dif: Easy                                                       AICPA: BB-Legal

 

32. Information that is not or cannot be protected under trademark, patent, or copyright law may be protected under the law of trade secrets.

 

ANSWER:         T                               PAGE:        146                           TYPE:         N

BUSPROG: Analytic                    LO: 5-5                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Critical Thinking

 

33. Anyone who writes a book has automatic international copyright protection.

 

ANSWER:         F                               PAGE:        148                           TYPE:         +

BUSPROG: Analytic                    LO: 5-5                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Legal

 

34. Each member country of the TRIPS agreement must include in its domestic laws intellectual property rights.

 

ANSWER:         T                               PAGE:        149                           TYPE:         =

BUSPROG: Analytic                    LO: 5-5                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

35. The TRIPS agreement covers computer programs.

 

ANSWER:         T                               PAGE:        149                           TYPE:         +

BUSPROG: Reflective                 LO: 5-5                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

 

MULTIPLE-CHOICE questions

 

1. Paula develops a new espresso machine that she names “Sure Shot.” She also writes an operating manual for the machine. Paula can obtain trademark protection for

 

1. the espresso machine.
2. the “newness” of the espresso machine.
3. the name “Sure Shot.”
4. the operating manual.

 

ANSWER:         C                               PAGE:        127                           TYPE:         =

BUSPROG: Reflective                 LO: 5-2                Bloom’s: Application

Dif: Moderate                                                       AICPA: BB-Legal

 

2. Trademarks are protected from use on noncompeting goods by

 

1. the Federal Trademark Dilution Act.
2. the America Invents Act.
3. the Anticybersquatting Consumer Protection Act.
4. the Copyright Act.

 

ANSWER:         A                               PAGE:        128                           TYPE:         N

BUSPROG: Reflective                 LO: 5-2       Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

3. Beans Coffee & Cocoa Company makes and sells a chocolate-flavored coffee drink under the name “CoCoCafe.” Darkroast Java, Inc., later markets a similar drink under the name “KoKoKafe.” This is most likely

 

1. copyright infringement.
2. patent infringement.
3. trademark infringement.
4. a theft of trade secrets.

 

answer:         C                               PAGE:        129                           TYPE:         =

BUSPROG: Reflective                 LO: 5-2                Bloom’s: Application

Dif: Easy                                                       AICPA: BB-Legal

 

4. Bubbly Cola features Sparkly Cola’s trademark without its owner’s permission. Bubbly’s use of the mark is actionable provided

 

1. consumers are confused.
2. Bubbly’s use is intentional.
3. Bubbly’s use reduces the value of Sparkly’s mark.
4. Sparkly’s mark is registered.

 

ANSWER:         A                               PAGE:        129                           TYPE:         =

BUSPROG: Reflective                 LO: 5-2                Bloom’s: Comprehension

Dif: Easy                                                       AICPA: BB-Legal

 

5. Li’l Canine Company (LCC) uses a trademark that neither LCC nor anyone else has registered with the government. Under federal trademark law, LCC

 

1. can register the mark for protection.
2. cannot register a mark that has been used in commerce.
3. has committed trademark infringement.
4. must put off registration until the mark is out of use for six months.

 

answer:         A                               PAGE:        129                           TYPE:         =

BUSPROG: Reflective                 LO: 5-2                Bloom’s: Comprehension

Dif: Easy                                                       AICPA: BB-Legal

 

6. In 2012, Online Marketing Corporation registers its trademark as provided by federal law. After the first renewal, this registration

 

1. is renewable every ten years.
2. is renewable every twenty years.
3. runs for the life of the corporation plus seventy years.
4. runs forever.

 

ANSWER:         A                               PAGE:        129                           TYPE:         =

BUSPROG: Reflective                 LO: 5-2                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

7. John Jones decides to use his personal name for a line of clothing he is developing. Whether or not the name John Jones acquires a secondary meaning will depend on

 

1. how extensively John markets his line of clothing.
2. the market for John’s line of clothing.
3. the number of clothing sales John makes.
4. all of the choices are correct.

 

ANSWER:         D                               PAGE:        132                           TYPE:         N

BUSPROG: Reflective                 LO: 5-2                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Legal

 

8. Billy opens a bicycle shop that sells an innovative new kind of bicycle. He decides to call the bicycles “Bicycles.” Billy extensively markets his product, has a high sales volume and becomes well known for selling Bicycles. The term Bicycle

 

1. is automatically protected against trademark infringement.
2. receives no protection against trademark infringement.
3. can be registered as a trademark to obtain protection against trademark infringement.
4. can be registered as a certification mark.

 

ANSWER:         B                               PAGE:        132                           TYPE:         N

BUSPROG: Reflective                 LO: 5-2                Bloom’s: Application

Dif: Moderate                                                       AICPA: BB-Legal

 

9. Wendy works as a weather announcer for a TV station under the character name Weather Wendy. Wendy can register her name as a

 

1. a certification mark.
2. a collective mark.
3. a service mark.
4. a trade name.

 

ANSWER:         C                               PAGE:        132                           TYPE:         N

BUSPROG: Reflective                 LO: 5-2                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Legal

 

10. Which of the following can not be registered as a trade name?

 

1. Pear Blossom, Certified Public Accountant
2. Apples & Oranges, Investment Partnership
3. Banana Republic Clothing, Inc.
4. Strawberries

 

ANSWER:         D                               PAGE:        132                           TYPE:         N

BUSPROG: Reflective                 LO: 5-2                Bloom’s: Comprehension

Dif: Easy                                                       AICPA: BB-Legal

 

11. Trek Transport Company uses a mark associated with its name to distinguish its services from those of other trucking firms. This mark is

 

1. a certification mark.
2. a collective mark.
3. a service mark.
4. a trade name.

 

ANSWER:         C                               PAGE:        132                           TYPE:         =

BUSPROG: Reflective                 LO: 5-2                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Legal

 

12. Trevor’s operates The Spicy Chocolatier Café chain of restaurants. “The Spicy Chocolatier Café” is a

 

1. certification mark.
2. collective mark.
3. service mark.
4. trade name.

 

ANSWER:         D                               PAGE:        134                           TYPE:         N

BUSPROG: Reflective                 LO: 5-2                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Legal

 

13. Mary Kate Corporation allows Ashley Company to use Mary Kate’s trademark as part of Ashley’s domain name. This is

 

1. a license.
2. a likelihood of consumer confusion.
3. cybersquatting.
4. trademark dilution.

 

ANSWER:         A                               PAGE:        134                           TYPE:         =

BUSPROG: Reflective                 LO: 5-2                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Legal

 

14. Jeannie runs a dude ranch called J Bar B Dude Ranch and has a Web site called www,jbarbduderanch.com. Ben starts another dude ranch and registers a Web site called www,jbarbduderanch.com. Ben is

 

1. cybersquatting.
2. cyberstalking.
3. not doing anything illegal.
4. counterfeiting.

 

ANSWER:         A                               PAGE:        135                           TYPE:         N

BUSPROG: Reflective                 LO: 5-2                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Legal

 

15. E-Shopping Corporation inserts Fiesta Mall, Inc.’s trademark as a meta tag in E-Shopping’s Web site’s key-words field without Fiesta’s permission in a manner that suggests Fiesta authorized the use. This is

 

1. copyright infringement.
2. patent infringement.
3. trademark infringement.
4. no infringement.

 

answer:         C                               PAGE:        136                           TYPE:         =

BUSPROG: Reflective                 LO: 5-2                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Legal

 

16. Ric designs a new tablet computer that he names “Sci Phi.” He also writes the operating manual to be included with each final product. Ric can obtain patent protection for

 

1. the tablet computer.
2. the “newness” of the tablet computer.
3. the name.
4. the operating manual.

 

answer:         A                               PAGE:        138                           TYPE:         =

BUSPROG: Reflective                 LO: 5-3                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Legal

 

17. Ryan invents a pen that digitally “remembers” what is written or drawn with it. To obtain a patent for the pen, Ryan does not have to show that it is

 

1. novel.
2. marketable.
3. useful.
4. not obvious in light of current technology.

 

ANSWER:         B                               PAGE:        138                           TYPE:         N

BUSPROG: Reflective                 LO: 5-3                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Legal

 

18. Zoe invents “All for One,” new business inventory control software, and applies for a patent. If Zoe is granted a patent, it will protect her product

 

1. for ten years.
2. for twenty years.
3. for the life of the inventor plus seventy years.
4. forever.

 

ANSWER:         B                               PAGE:        138                           TYPE:         N

BUSPROG: Reflective                 LO: 5-3                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

19. Sights Unseen, Inc., (SUI) sells telescopes with distinctively designed lenses and mirrors. Later, without SUI’s permission, Telescopes Etc. Corporation begins to sell scopes with identical structures of lenses and mirrors. This is most likely

 

1. copyright infringement.
2. patent infringement.
3. trademark infringement.
4. not infringement.

 

ANSWER:         B                               PAGE:        139                           TYPE:         =

BUSPROG: Reflective                 LO: 5-3                Bloom’s: Application

Dif: Moderate                                                       AICPA: BB-Legal

 

20. Gas Up, Inc., designs, makes, and sells a fuel injection system that copies Hybrid Corporation’s design without Hybrid’s permis­sion. This is most likely

 

1. copyright infringement.
2. patent infringement.
3. trademark infringement.
4. a theft of trade secrets.

 

answer:         B                               PAGE:        139                           TYPE:         =

BUSPROG: Reflective                 LO: 5-3                Bloom’s: Application

Dif: Moderate                                                       AICPA: BB-Legal

 

21. RiteMade Machinery, Inc., designs, makes, and sells a drill press. Steel Equipment Company copies the design without RiteMade’s permission. Steel’s conduct is actionable provided that

 

1. consumers are confused.
2. Steel’s conduct is intentional.
3. Steel’s conduct reduces the value of RiteMade’s design.
4. RiteMade’s design is patented.

 

answer:         D                               PAGE:        139                           TYPE:         =

BUSPROG: Reflective                 LO: 5-3                Bloom’s: Application

Dif: Moderate                                                       AICPA: BB-Legal

 

22. Stormclouds Inc. makes and markets its U.S. patented Tempest Tablet in the United States. Squalls Ltd., a Chinese firm, begins making and marketing the same product in China as Outburst Pad without Stormclouds’s permission. Squalls is

 

1. not guilty of patent infringement.
2. guilty of patent infringement.
3. guilty of trademark infringement.
4. in violation of the America Invents Act.

 

ANSWER:         A                               PAGE:        139                           TYPE:         N

BUSPROG: Reflective                 LO: 5-3                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Legal

 

23. Riley invents a new valve to cap undersea oil spills. He names the valve “Great Catch.” He also writes the installation manual to be included with each valve. Riley can obtain copyright protection for

 

1. the valve.
2. the “newness” of the valve.
3. the name.
4. the installation manual.

 

ANSWER:         D                               PAGE:        141                           TYPE:         N

BUSPROG: Reflective                 LO: 5-4                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Legal

 

24. Sayers is very clever and spends lots of time creating new things. Which of the following is not copyrightable?

 

1. A sculpture of Sayers’s horse
2. A book about Sayers’s life
3. A movie about Sayers’s life
4. Sayers’s idea for a new way to play the guitar

 

ANSWER:         D                               PAGE:        141                           TYPE:         N

BUSPROG:  Reflective                LO: 5-4                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Legal

 

25. Go! is a handheld video game featuring races between imaginary creatures and vehicles. The graphics used in the game are protected by

 

1. copyright law.
2. patent law.
3. trademark law.
4. trade secrets law.

 

ANSWER:         A                               PAGE:        141                           TYPE:         =

BUSPROG: Reflective                 LO: 5-4                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

26. Elvin publishes a book titled First Place, which includes a chapter from Frank’s copyrighted book Olympic Winners & Losers. Elvin’s use of the chapter is actionable provided

 

1. consumers are confused.
2. Elvin’s use is intentional.
3. Elvin’s use reproduces Frank’s chapter exactly.
4. Elvin does not have Frank’s permission.

 

ANSWER:         D                               PAGE:        142                           TYPE:         =

BUSPROG: Reflective                 LO: 5-4                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Legal

 

27. Mace copies Nick’s book, Mumbai Monsoon, in its entirety and sells it to Parkland Books, Inc., without Nick’s permission. Parkland publishes it under Mace’s name. This is

 

1. copyright infringement.
2. fair use.
3. licensing.
4. protected expression.

 

ANSWER:         A                               PAGE:        142                           TYPE:         =

BUSPROG: Reflective                 LO: 5-4                Bloom’s: Comprehension

Dif: Easy                                                       AICPA: BB-Legal

 

28. James buys a copy of the book Downpour. Later, after reading the book, James sells it to his sister. Under the first sale doctrine, James’s sale of the book is

 

1. legal.
2. legal only if the copyright has expired.
3. legal only if he sells it for less than he paid for it.
4. illegal.

 

ANSWER:         A                               PAGE:        143                           TYPE:         N

BUSPROG: Reflective                 LO: 5-4                Bloom’s: Comprehension

Dif: Easy                                                       AICPA: BB-Legal

 

29. Joey reproduces Mina’s copyrighted work Storm on the Mountain without paying royalties. Joey is most likely excepted from liability for copyright infringement under the “fair use” doctrine if

 

1. Joey copies the entire work.
2. Joey distributes the copies without charge to the public.
3. Joey’s use has no effect on the market for Mina’s work.
4. Joey’s use is for a commercial purpose.

 

ANSWER:         C                               PAGE:        143                           TYPE:         =

BUSPROG: Reflective                 LO: 5-4                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Legal

 

30. Megan goes to visit her friend Kathleen. While visiting, Megan downloads Kathleen’s copy of Photoshop onto her computer’s random access memory without Kathleen’s permission. Megan is guilty of

 

1. copyright infringement.
2. patent infringement.
3. cybersquatting.
4. trademark dilution.

 

ANSWER:         A                               PAGE:        144                           TYPE:         N

BUSPROG: Reflective                 LO: 5-4                Bloom’s: Comprehension

Dif: Easy                                                       AICPA: BB-Legal

 

31. The idea for “On Your Mark,” a computer game featuring world-class athletic competition in extreme and unique contests, is protected by

 

1. copyright law.
2. patent law.
3. trademark law.
4. trade secrets law.

 

ANSWER:         D                               PAGE:        146                           TYPE:         =

BUSPROG: Reflective                 LO: 5-5                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Legal

 

32. Ewa is Diamond Financial Planners’ most productive employee. She is dissatisfied with the commission structure, however, so she quits to work for Feldstar Investments, Inc. When she leaves Diamond’s employ, she takes her list of Diamond’s clients so that she can induce them to switch to Feldstar. Trade secrets law covers

 

1. Diamond’s list of clients.
2. Ewa’s performance.
3. Feldstar’s commission structure.
4. none of the choices.

 

answer:         A                               PAGE:        146                           TYPE:         =

BUSPROG: Reflective                 LO: 5-5                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Legal

 

33. Caramello Chip & Cookie Corporation (4C) obtains, and gives its employees, a list of the customers of Sugar & Spice Sales, Inc. (3S). Under the law that applies to trade secrets, 4C’s conduct is actionable provided

 

1. consumers are confused.
2. 4C’s conduct is intentional.
3. 4C uses the list.
4. 4C does not have 3S’s permission to use the list.

 

ANSWER:         D                               PAGE:        146                           TYPE:         =

BUSPROG: Reflective                 LO: 5-5                Bloom’s: Application

Dif: Moderate                                                       AICPA: BB-Legal

 

34. Ross, an employee at Super Snowboard Company, is laid off. Before he exits Super’s building, he e-mails the company’s marketing campaign to Winter Sports Corporation, Super’s competitor, without permission. This is

 

1. copyright infringement.
2. patent infringement.
3. trademark infringement.
4. a theft of trade secrets.

 

ANSWER:         D                               PAGE:        146                           TYPE:         =

BUSPROG: Reflective                 LO: 5-5                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Legal

 

35. New Apps Company develops “Browser Lite” software, which speeds the display of graphics on Web sites. Browser “Lite” has the most copyright protection under

 

1. the Berne Convention.
2. the Paris Convention
3. the TRIPS Agreement.
4. the Madrid Protocol.

 

answer:         A                               PAGE:        148                           TYPE:         =

BUSPROG: Reflective                 LO: 5-5                Bloom’s: Comprehension

Dif: Easy                                                       AICPA: BB-Legal

 

 

 

ESSAY questions

 

1. In 2002, Hawk Corporation begins making and selling electric motorcycles under the mark “Hawk.” Ten years later, Hawk.com, Inc., a differ­ent company selling medical equipment and supplies, begins to use “hawk” as part of its URL and registers it as a domain name. Can Hawk Corporation stop Hawk.com’s use of “hawk”? If so, what must the motorcycle-maker show?

 

ANSWER:         Hawk may be successful in obtaining a court order to stop the use of its name as part of another company’s URL and registered domain name. This use may constitute trademark dilution. Dilution occurs when a trade­mark is used, without permission, in a way that diminishes the distinctive quality of the mark. This cause of action does not require proof that con­sumers are likely to be confused by a connection between the un­authorized use and the mark. As in this problem, the products in­volved do not have to be similar. To succeed on a charge of dilution, how­ever, the owner must show that its mark was famous when the dilution took place.

 

PAGE:  137                                                                  type:               =

BUSPROG: Reflective                 LO: 5-2                Bloom’s: Analysis

Dif: Challenging                                                    AICPA: BB-Decision Modeling

 

2. College Copy Shop (CCS) compiles, copies, and sells reading materials to students. The compilations are prepared on the instructions of professors, who indicate which parts of which publications should be included for their students. The copied materials include texts published by Deep Topics, Inc. CCS does not obtain the permission of Deep Topics, or any of the other original publishers of the copied materials, and does not pay royalties on the sales of the compilations. Deep Topics and others file a suit against CCS, alleging infringement of their intellectual property rights. Which type of intellectual property is involved in this situation? What is CCS’s likely defense? How is a court most likely to rule? Explain.

 

ANSWER:         The intellectual property at issue in this situation is copyright—specifically, of course, the copyrights of the publishers of the materials that CCS copies and sells without permission. CCS is likely to assert the “fair use” doctrine in its defense. This doctrine allow exceptions to the general requirement that an owner’s permission be obtained before copyrighted material can be copied. CCS is likely to argue that its compilations are excepted because they are dedicated to “educational” uses. A court is most likely to conclude, however, that CCS’s copying and selling of the materials is not a fair use, because CCS profits from the sales, which undercut the potential market for the copyrighted publications from which the copies are made. In determining fair use, a court considers four factors: the purpose and character of the use, the nature of the copyrighted work, the amount and substantiality of the portion used in relation to the copyrighted work as a whole, and the effect of the use on the potential market for or value of the copyrighted work. In this situation, the fourth factor is most significant and supports the conclusion that CCS’s use of the materials is not a fair use.

 

PAGES: 142–143                                                                                  type:         =

BUSPROG: Reflective                 LO: 5-4                Bloom’s: Analysis

Dif: Challenging                                                    AICPA: BB-Decision Modeling