Riordan_Manufacturing

Riordan Manufacturing Corporate Compliance Plan Business Law 531 John Huschen July 3, 2010 Christine Alward I. Introduction Riordan Manufacturing is an organization that is owned by Riordan Industries which is a Fortune 1000 enterprise that brings in revenues over $1 billion a year. Riordan has four facilities in San Jose, California, Albany, Georgia, Pontiac, Michigan and Hangzhou, China. Riordan is a global plastics manufacturer who employees 550 people. Riordan produces automotive and airplane parts, along with producing goods for the Department of Defense, plastic bottles and parts for appliances. The mission at Riordan Manufacturing is to focus on exceeding ISO 9000 standards define that attitude and abilities of Riordan Manufacturing. Riordan is industry leaders in using polymer materials to provide solutions for their customers. Riordan wants to be an industry leader in identifying industry trends. With the customers Riordan wants to strive to be a solution provider for their customers. Riordan also wants to have long term relationships with their customers by maintaining rigorous quality controls, innovative solutions, along with a responsive business attitude and reasonable pricing. For Riordan’s employees they want to maintain an innovative and team oriented working environment. Riordan also wants assure that their employees are well informed and supported; they also want to provide a climate focused on the long term viability of their company. The Corporate Compliance Plan will provide standards of conduct based on product liability, international law, tangible and intellectual property, legal forms of business and governance of the board of directors. It will address internal control systems that are capable of reducing the likelihood of violations of law. It will address specific laws and aspects the Riordan must adhere to. II. Contract Law Riordan Manufacturing deals with many different customers such as automotive parts manufactures, aircraft manufacturers, the Department of Defense, beverage markers and bottlers, and appliance manufacturers. When working with customers it is important that contracts are developed to settle on pricing and quantity of the products being delivered, along with the quality of product produced. “A contract is a promise or a set of promises for the breach of which the law gives a remedy or the performance of which the law in some way recognizes a duty (Cheeseman, 2010).” The contracts between Riordan Manufacturing and its customers are a unilateral contract. Unilateral contracts can be revoked by the customer at any time prior to the Riordan’s performance. The contract can not be revoked after Riordan has finished making the product. If for some reason Riordan’s customer is unhappy with Riordan and would like to revoke their contract then it is possible for Riordan to enter into negotiations or arbitration with its customers. Negotiation is a procedure where the parties have a dispute and engage in negotiation to try to reach a voluntary settlement on their dispute. In this case it is possible for the customer and Riordan to come to an accord. An accord is an agreement where the parties agree to accept something different then the original contract (Cheeseman, 2010). Arbitration is another form that can help settle contract disputes. The Federal Arbitration Act allows states to handle disputes at a state level. Arbitration is cheaper then going to court (Cheeseman 2010). III. Patents & Trade secrets Riordan manufactures products for customers and the engineers create new products at all times. These products are protected by law under the Uniform Trade Secrets Act. This allows organizations to bring about a lawsuit to anyone who steals a trade secret. The trade secret has to be obtained through unlawful means, such as theft, bribery, or industrial espionage (Cheeseman 2010). Riordan takes stealing trade secrets very seriously, anyone who steals or discloses confidential information will be subject to disciplinary action, up to termination of employment and legal action. The Economic Espionage Act of 1996 makes it a federal crime to steal trade secrets for his or her benefit or for the benefit of others, knowing or intending that the act would cause injury to the owner of the trade secret (Cheeseman 2010). There is also the Civil Trade Secret Law which allows the owner of the trade secret to bring a civil lawsuit against the person who stole the trade secret. The owner can recover any profits made by the offender from use of the trade secret, along with recovering damages and obtain an injunction prohibiting the offender from divulging or using the trade secret (Cheeseman 2010). Because of these two acts it allows Riordan to prosecute any employee that steals a trade secret. Riordan also patents their products by filing with the United States Patent and Trademark Office in Washington DC. The Federal Patent Statute of 1952 protects companies from patent infringement. Also the American Inventors Protection Act is a federal statute that permits an inventor to file a provisional application up to three months before the filing of a final patent application (Cheeseman 2010). If any employee invents a product while working at Riordan that product belongs to Riordan and will be patented by Riordan. IV. Product Liability Riordan is required to produce products that are safe for all of its customers and will not cause any know dangers. If Riordan produces a product that is defective then the executives of Riordan could be held to strict liability and have to pay for any damages that occur from the defective product. Strict liability states companies can be held liable without fault (Cheeseman 2010). A defective product constitutes when a manufacture fails to properly assemble a product, properly test a product or forget to check the quality of the product (Cheeseman 2010). It is the responsibility of Riordan to warn its customers when it produces a defective product. Riordan could be held liable for punitive damages. Riordan would need to contact their lawyer in order to discuss how to handle the fact they created a defective product. V. Governance Riordan Manufacturing Board of Directors is responsible for the overall management of Riordan business affairs in accordance with state corporation requirements, which are the Articles of incorporation. The governance of the board is to manage the affairs of the Company for the benefit of the shareholders. The Board oversees the quality management of the employees who carry out the daily activities on behalf of the Board of Directors. The Board is responsible for electing new members to the Board from senior management. The Nominating Committee is responsible for making recommendations to the Board about the new members. The Board of Directors passes its authority to operate the Company to senior management and Company staff, and then report back to the Board about the activities of the Company. The Board of Directors holds the finical responsibility of the Company. The Board has the right to remove senior managers when it is in the best interest of the Company and shareholders. Conclusion It is the responsibility of the employees of Riordan Manufacturing to report any illegal activity to the Compliance Offers and follow the code of conduct of the organization. It is the responsibility of Senior Management to make sure if any illegal activity occurs to go the hired attorney for advice when there is illegal activity. References Cheeseman, H. R. (2010). Business Law. Legal Environment, Online Commerce, Business Ethics, and Internal Issues (7th ed.).