Christopher Melony Xie and Ruth form iNet com LLC a limited
Christopher, Melony, Xie, and Ruth form, LLC, a limited liability company. The four members are all Ph. D. scientists who have been working together in a backyard garage to develop a handheld wireless device that lets you receive and send e mail, surf the Internet, use a word processing program that can print to any printer in the world, view cable television stations, and keep track of anyone you want anywhere in the world as well as zoom in on the person being tracked without that person knowing you are doing so. This new device, called Eros, costs only $ 29 but makes the owners $ 25 profit per unit sold. The owners agree that they will buy a manufacturing plant and start producing the unit in six months. Melony, who owns a one quarter interest in, LLC, decides she wants “more of the action” and soon, so she secretly sells the plans and drawings for the new Eros unit to a competitor for $ 100 million. The competitor comes out with exactly the same device, called Zeus, in one month and beats iNet. com, LLC, to market. The LLC, which later finds out about Melony’s action, suffers damages of $ 100 million because of Melony’s action. Is Melony liable to iNet. com, LLC? Explain. Did Melony act ethically in this case?
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