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As a manager employed by Want-It-Now Rapid Delivery Service, you are responsible for pricing the services involving same-day deliveries. Among your primary concerns is the competitive aspects of your business. You have proposed contractual language that states “any package picked up after 10:00 a.m. will be considered as if it is picked up the next business day. Any package delivered before 10:00 p.m. on the day of pick up will be considered to have arrived on that business day. Under the language, a package received at 11:00 a.m. on Tuesday and delivered by 10:00 p.m. on Wednesday is considered, by you, to involve a “same-day delivery.” The impact of this language is that a business day lasts for as long as 36 hours; thereby giving a customer the wrong impression of the phrase “same-day delivery.”
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The Federal Trade Commission (FTC), under its authority to protect the public from unfair or deceptive trade practices, has contacted your company asking questions about the plain meaning of “same-day delivery.” In anticipation of a face-to-face meeting with an FTC investigator, you strive to answer these questions.
- To what degree does the FTC have authority to question your business practices?
- Are your clearly stated contractual provisions unfair or deceptive?
- Should you cooperate with this investigator or seek a court order enjoining this investigation?
- How do you challenge the FTC’s action if a formal complaint is filed against your company?
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