Please use this information, plus the additional facts noted, to answer Questions 21-23 (total 9 points).

In connection with a separate development contract between Sound and Bricker, Bricker was disappointed in inventory management software Sound developed, as delivered in final form. Sophia Bricker delivered a letter to Sound rejecting the product and asking for damages. Bricker sought $600,000 in fees Bricker paid for the software, plus $50,000 (to account for interest), plus $60,000 in indirect damages for lost time of employees while they tried to get Sound software to work as warranted, plus $40,000 for lost profits as a result of softwares not performing correctly. The contract contains the following language:

To the extent Sound is found to have any liability under this Development Agreement, such liability shall not exceed the aggregate dollar amount paid by Bricker to Sound during the 12 months prior to the breach. NOTWITHSTANDING ANYTHING IN THIS AGREEMENT TO THE CONTRARY, SOUND SHALL NOT BE LIABLE FOR LOST PROFITS, LOSS OF REVENUE OR ANY OTHER INDIRECT, INCIDENTAL, SPECIAL, PUNITIVE, OR OTHER CONSEQUENTIAL DAMAGES ARISING IN ANY WAY FROM VENDORS BREACH OF THIS AGREEMENT.

Sounds finance group reports that under the Development Agreement, Bricker paid the $600,000 contract fee in five equal $120,000 installments, each on the last day of the quarter beginning on September 30, 2018, with final payment made on September 30, 2019. Bricker discovered the breach in the delivered software June 1, 2019.

With respect to fees paid, Sound concluded that under the contract it could be liable for up to:

21. Group of answer choices

$650,000 (including interest)

$600,000

$480,000

$360,000

$240,000

$120,000

22. Sound also concluded it was liable for $40,000 for lost profits.

Group of answer choices

True

False

23. And Sound concluded that Bricker should NOT have asked for:

$60,000 for the lost time of your employees as a consequence of their trying to make the software work (consequential damage).

Group of answer choices

True

False

24.

Use these facts to answer question 24

Then, to her annoyance, Sophia Bricker received a letter from the lawyers for Infringed Co. stating that Sounds inventory management software infringed their patent rights. Sophia asked Diana Bricker to return from vacation to address the problem. Diana and her outside counsel made several phone calls to Infringeds lawyers, finally convincing Infringed that Bricker was not using the Sound inventory management software and was not liable to Infringed. Diana Bricker received a bill from her lawyer for $9,000. Diana wrote to Sound, seeking to be indemnified for the $9,000 legal fees. The indemnity clause of the Development Agreement says:

Intellectual Property Indemnity

For six (6) months following the Effective Date of this Agreement, Sound will indemnify Bricker against all damages, losses and costs (including attorneys fees) adjudicated by a court and finally awarded arising from claims alleging that the developed software infringes any third party copyright or trade secret that exists as of the date the Agreement is signed (the Effective Date). Sound will not be obligated to indemnify Bricker to the extent any infringement arises out of Sounds use of open source software incorporated by Sound into the product.

Flag question: Question 24

Question 24

Sound reads the Intellectual Property Indemnity above and concludes that it must cover Brickers outside attorneys fees because that is required under the indemnity. Sound is correct in its interpretation of the indemnity.

Group of answer choices

True

False