Person TP and person JN were two partners of a firm SI. JN offered to buy the shares of TP to which he agreed. Later, TP found that JN concealed the fact of the invention of a new product during negotiations and brought a suit against him on the grounds of fraud and other claims. To find: Liability of SI in the above case.

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homas Persson and Jon Nokes founded Smart Inventions, Inc., to market household consumer products. The success of their first product, the Smart Mop, continued with later products, which were sold through infomercials and other means. Persson and Nokes were the firm’s officers and equal shareholders. Persson was responsible for product development, and Nokes was in charge of day-to-day operations. In time, they became dissatisfied with each other’s efforts. Nokes represented the firm as financially “dying,” “in a grim state, . . . worse than ever,” and offered to buy all of Persson’s shares for $1.6 million. Persson accepted.On the day that they signed the agreement to transfer the shares, Smart Inventions began marketing a new product—the Tap Light. It was an instant success, generating millions of dollars in revenues. In negotiating with Persson, Nokes had intentionally kept the Tap Light a secret. Persson sued Smart Inventions, asserting fraud and other claims. Under what principle…

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Chapter 18, Problem 3BCP

Summary Introduction

Case summary: Person TP and person JN were two partners of a firm SI. JN offered to buy the shares of TP to which he agreed. Later, TP found that JN concealed the fact of the invention of a new product during negotiations and brought a suit against him on the grounds of fraud and other claims.

To find: Liability of SI in the above case.

Summary Introduction

Case summary: TP and JN were two partners of a firm SI. JN offered to buy the shares of TP to which he agreed. Later, TP found that JN concealed the fact of the invention of a new product during negotiations and brought a suit against him on the grounds of fraud and other claims.

To find: Liability of SI in the above case.

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homas Persson and Jon Nokes founded Smart Inventions, Inc., to market household consumer products. The success of their first product, the Smart Mop, continued with later products, which were sold through infomercials and other means. Persson and Nokes were the firm’s officers and equal shareholders. Persson was responsible for product development, and Nokes was in charge of day-to-day operations. In time, they became dissatisfied with each other’s efforts. Nokes represented the firm as financially “dying,” “in a grim state, . . . worse than ever,” and offered to buy all of Persson’s shares for $1.6 million. Persson accepted.On the day that they signed the agreement to transfer the shares, Smart Inventions began marketing a new product—the Tap Light. It was an instant success, generating millions of dollars in revenues. In negotiating with Persson, Nokes had intentionally kept the Tap Light a secret. Persson sued Smart Inventions, asserting fraud and other claims. Under what principle…

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