LAW Using the IRAC method Jenny is a director of Colonels F

LAW

Using the IRAC method

. Jenny is a director of Colonel’s Fried Chicken Pty Ltd (CFC), a chain of fast food restaurants specialising in chicken fried in secret herbs and spices. Jenny decides that she will start her own new company, also specialising in fried chicken. She calls her new company Fat’n’Fried Pty Ltd. Jenny takes copies of the secret herbs and spices recipe from CFC without telling anyone. Jenny then uses the CFC secret recipe to create the fried chicken in her Fat’n’Fried restaurants. The other directors at CFC hear about this and seek your advice about whether Jenny has breached her duties as a director under the Corporations Act. If yes, specify the sections and explain how the elements apply to her conduct. Refer to any relevant cases.

Solution

Yes, Jenny has breached the intellectual property right of an organization and she can be charged for theft of trade secrets because she actually took copies of the secret herbs and recipe from Colonel’s Fried Chicken Pty Ltd (CFC) which is illegal. Under the Economic Espionage Act propounded in 1996 that through this theft she is benefitting a foreign organization that is her own organization in this context. She can be charged with penalties that may seem very harsh for her but the government possess a no tolerance attitude towards such a incident and as the act is illegal it should also not be supported at all. Under the U.S. Code Title 18, Section 1831 Jenny can be imprisoned for 15 years and also charged a fine of $5 million and she is using this to benefit herself that is an external organization she may also be charged a fine of $250,000 and an imprisonment of 10 years under the U.S. Code Title 18, Section 1832. There are some other charges too that can be used against her but this is the maximum punishment and penalty that she may get.