Explain why BNI and Carol do or do not have a contract.

1. Max plots a new Batman adventure and carefully and skillfully imitates the art of DC Comics to create an authentic-looking Batman comic. Max is not affiliated with the owners of the copyright to Batman. Can Max publish the comic without infringing on the owners’ copyright?

2. On May 1, Brand Name Industries, Inc. (BNI), sent Carol a letter, via overnight delivery, offering to employ her to audit BNI’s financial statements for the current year for $1,000. In the letter, BNI stated that Carol had ten days to accept. On May 5, Carol sent BNI a fax that stated, “The price for the audit seems too low. Would you consider paying $1,200?” BNI received the fax. The next day, Dan offered to conduct the audit for $800. On learning of Dan’s offer, Carol immediately e-mailed BNI, agreeing to do the work for $1,000. BNI received this e-mail on May 7. Explain why BNI and Carol do, or do not, have a contract.

3. Omega, Inc., sells business application software⎯accounting and bookkeeping programs, blank business forms, inventory control functions, and so on⎯in different combinations, in different packages, at different prices. Each package includes a shrink-wrap agreement that limits warranties and remedies. Precision Engineering Associates (PEA) buys an Omega package and uses the product. Later, PEA files a suit against Omega, claiming that the software is flawed and that the flaws caused PEA to suffer business losses. PEA asks for relief that exceeds the limits in the shrink-wrap agreement. What are shrink-wrap agreements? Are these agreements always enforced? Under what circumstances is a court likely to enforce this agreement?

4. Ed, a businessperson, is a friend of Fran, the owner of a candy store. Every day, Ed spends five minutes in Fran’s candy store, looking at the candy and usually buying one or two candy bars. One afternoon, Ed goes into the store, looks at the candy, and picks up a $1 candy bar. Ed waves the candy at Fran without saying a word and walks out. Is there a contract? If so, how would it be classified in terms of formation, performance, and enforceability?