Chapter 9, Problem 1QAP

Able, a Certified Fraud Examiner, interviewed a suspect involved in an environmental crime. The suspect, Blake, admitted to purposely polluting the environment. Blake’s action eventually caused almost thirty people to develop serious environmentally related illness. Upon hearing this fact from Blake, Able should: A. Scold Blake for his conduct. B. Make no comment whatever. C. Treat Blake with decency and respect. D. Ask Blake to apologize to the victims.

Irwin Schiff is a self-styled “tax rebel” who has made a career, and substantial profit, out of his tax protest activities. On February 7, Schiff appeared live on CBS News Nightwatch, a late-night program with a viewer participation format. During the broadcast, Schiff repeated his assertion that nothing in the Internal Revenue Code stated that an individual was legally required to pay federal income tax. Schiff then challenged, “If anybody calls this show—I have the Code—and cites any section of this Code that says an individual is required to file a tax return, I will pay them $100,000.” Call-in telephone numbers were periodically flashed on the screen. John Newman, an attorney, did not see Schiff’s live appearance on Nightwatch. Newman did, however, see a twominute videotaped segment, including Schiff’s challenge, which was rebroadcast several hours later on the CBS Morning News. Newman researched the matter that same day and on the following day, February 9, placed a call using…

“Give me the ‘McFacts,’ ma’am, nothing but the McFacts!” So argued the defense attorney for McDonald’s Corporation as she questioned Stella Liebeck, an 81-year-old retired sales clerk, two years after her initial lawsuit against McDonald’s claiming that it served dangerously hot coffee.Liebeck had bought a 49-cent cup of coffee at the drive-in window of an Albuquerque McDonald’s, and while removing the lid to add cream and sugar, she spilled the coffee and suffered third-degree burns of the groin, inner thighs, and buttocks. Her suit claimed that the coffee was “defective.”During the trial, it was determined that testing of coffee at other local restaurants found that none came closer than 20° to the temperature at which McDonald’s coffee is poured (about 180°F). The jury decided in favor of Liebeck and awarded her compensatory damages of $200,000, which they reduced to $160,000 after determining that 20 percent of the fault belonged with Liebeck for spilling the coffee. The jury then…