Legal1001 – Individual IRAC Task
Student’s Name
Institutional Affiliation
Date
Legal1001 – Individual IRAC Task
Issue:
Linda, who was a nurse, installed software to enable her to do trading; however, the software did not work as expected for six months. She incurred a loss of 30% of the value of her savings, legitimately, should Linda file a lawsuit demanding a refund?
Rules:
Yes, there is a provision for lawsuits on false advertising by companies. Since there are specific advertising rules that offer the customer the freedom to sue businesses or institutions or organizations for tricking them or misleading them into buying their goods and services. Also, the case is a civil case that typically deals with issues of money and conflicts resultant from businesses for the same reason. Furthermore, the Federal Trade Commission (FTC) aids criminal prosecution by protecting consumers against fraudulent practices by educating consumers on their civil rights and accountabilities.
Application:
According to the Trademark Act of the Australian Laws, their regulations sites false advertising illegal. Essentially, advertising is making known a product that was never known by consumers. The aim is to make the consumers buy the products. However, the enforcement of the laws is following the intention and truth in advertising. Therefore, for Linda to successfully file a lawsuit against the company, he will have to file the civil lawsuit, a false advertising lawsuit, and the FTC prosecution will follow (Colleen Tressler, 2018). Therefore, considering the advertisement in the magazine:
“Savvy Invest Software is a new and innovative computer application. It acts as your stockbroker and helps any novice be a successful investor on the stock market. If you purchase SavvyInvest and trade on the stock market according to its directions for six months, we guarantee that you will create a 25% profit on your stock. If this does not materialize, we will refund the purchase price and pay you $5,000.”
Generally, Linda must prove her case against the Software Company. According to Gibbs Law Group, generally, false advertising lawsuits include misleading advertising information, a falsity that is the company lied about a crucial detail, customer recognition, and finally, the deceitful consumer motive on untruthful publicizing in obtaining the item for consumption or service (Gibbs Law Group, 2015). Nevertheless, in Linda’s case, were it not for the false advertising, she would not have installed the software to help her make the 25% as mentioned earlier for the profit of invested funds. She ended up losing 30% of her saving value because the promise made by Savvy Invest Software was not met; the consumers have a legal responsibility of claiming for their fund, as was mentioned in the advert.
The false advertisement may indirectly or unswervingly say or write something that is not true or ambiguous. It is important to note that any advertisement can be rendered untrue based on the information it does not cover. Crucial facts should never be omitted whatever the case. In extreme cases, the defendant may be sued for failure to disclose user information. However, several penalties can be associated with false advertising; for instance, if the defendant’s advertising intention was a fraud, there could be criminal penalties involved. Also, if the advertisement was delivered through other ways such as email, the company risks facing unembellished wire fraud penalties. Consumers can litigate for loss, compensations to recover the lost cash they paid for the service or product. In this case, Linda should pay for the law demanding the $5000 refund, as indicated in the earlier advertisement.
Importantly, when Linda was installing the software, it was stated as at that time that there would be a 25% profit, and if it does not happen, a refund was in order. Nonetheless, Linda is legally bound to the earlier advertisement and not the introduced advert one month ago. Further, it is clear that Linda had followed and used the application as directed unless there was some hidden agenda the company should be held responsible for their advertisement. In a nutshell, the advertisement can be considered a contract since it has specific terms, target consumers, or users, and also the publication intended to offer a contract (Up Counsel, 2020). This statement, “If you purchase SavvyInvest and trade on the stock market according to its directions for six months, we guarantee that you will make a 25% profit on your investment. If this does not happen, we will refund the purchase price and pay you $5,000” essentially, it is an agreement. The contract warranted that there is a guarantee of refund within six months if the 25% profit is not achieved. Beside, lawfully advertisements are an invitation for contract negotiations. Legally, the litigation may be on breach of contract.
If Linda viewed the advertisement and understood it as a solicitation to enter into a contract deal, then the courts are legally bonded to enforce the law putting into consideration the circumstances adjoining to the case. However, the reasonableness of the case should be apriority. This case is reasonable since the warranted period was six months, and a 30% loss was incurred instead of a 25% profit. Additionally, Linda is obligated to file a lawsuit on failure to disclosure. The software company out to give reasons and their intentions for changing the advertisement one month ago. Nevertheless, the contact agreed by Linda was six months ago. Therefore the new advertisement will be considered a new contract if it will be. In case the advertisement reads like this, you only receive your refund for the lost trading stock if you install the software. Then simply losing in the stock trade won’t be a sign of acceptance of the contract.
Conclusively, civil claim; equitable claim; which is a civil claim persuading the civil court to give an order to the defendant to take action on previously agreed terms. In this case, it will be a claim for a refund. However, in most cases, this is a claim filed for temporary restraining orders and injunctions (Lewis, 2020). Linda must file her civil lawsuit litigation in the following manner; make the pre-filing, initial pleading by filing complainant forms, Discovery; both sides will be given a chance to exchange facts. Pre-trial is the point when the complainant will get witnesses, and proper evidence tabled, if need be limiting issues for trial, is necessary. Trial; the case is heard by the jury or judge and finally, post-trial where the defendant or the complainant might feel the need to file for an appeal. However, not all civil cases might follow the given format; some have unique procedures.
Conclusions:
According to the Australian Consumer Law, the legislation prohibits deceptive or misleading conduct during the advertising or conducts likely to mislead in trade or commerce. Since it is not clear why the advert was changed one month to Linda filing her complaint, the software company must be concealing some information. Therefore, it is likely that Mrs. Linda will be able to have a successful refund should she file for a civil case or false advertising lawsuits.
References
Colleen Tressler. (2018, June 14). FTC aids criminal prosecutions. Consumer Information. Retrieved May 1, 2020, from https://www.consumer.ftc.gov/blog/2018/06/ftc-aids-criminal-prosecutions
Gibbs Law Group. (2015, July 17). False advertising law | Suing for false advertising: Lawsuits & penalties. Retrieved May 1, 2020, from https://www.classlawgroup.com/consumer-protection/false-advertising/laws/
Lewis. (2020). Types of cases. Civil Law Self-Help Center. Retrieved May 1, 2020, from https://www.civillawselfhelpcenter.org/self-help/getting-started/court-basics/56-types-of-cases
Up Counsel. (2020). Is an advertisement a contract: Everything you need to know. Retrieved May 1, 2020, from https://www.upcounsel.com/is-an-advertisement-a-contract