Section I:
Executive Summary
The reason for this report is in regards to a lawsuit against Royal 16 Theater complex in
the Eastfield Mall, made by Tommy a moviegoer. Tommy pursued legal action
subsequent to a great dissatisfaction he suffered at the theater after going to see “The
Governator,” the movie. The dilemma seems to be that Tommy believes the Royal
Theater, owned by Mr. Mull T. Plex, fraudulently misrepresented the actual time “The
Governator” the movie was to begin. What was shown at the time the movie was
announced to begin was not the movie itself but instead it was commercials. Mr. Plex and
the consortium would like to know how many moviegoers feel that by showing the
commercials, before the movies, they are being misled by the theater. We have
considered the possibility of the Royal Theater causing fraudulent misrepresentation to
Tommy as well as other moviegoers. Due to the possibility existing, we advise Mr. Plex
and the consortium to conduct a survey to uncover the percentage of unhappy moviegoers
that sit through the commercials unwillingly, and to try and prove the elements of
fraudulent misrepresentation.
What we found in our statistical analysis is that the theaters owned by Mr. Plex and the
consortium all have an insufficient percentage, less that 10%, of moviegoers that are
unhappy with the commercials shown previous to the movies. Yet, according to the law
analysis we have proven the elements for fraudulent misrepresentation. Meaning there is
a chance of losing the lawsuit against Tommy.
This is why we strongly recommend Mr. Plex and the Consortium to try and settle the
case with Tommy outside the court by having mediation, or a face-to-face negotiation.
Main Body
Characters
 Tommy – Business major at a local university who worked about 20 hours a
week.

Cashier – Employee at the Royal 16 Theater complex in the Eastfield Mall.

Manager – Manager at the Royal 16 Theater complex in the Eastfield Mall.

Mr. Mull T. Plex – Owner of the Royal 16 Theater complex in the Eastfield Mall.

Constortium – Mr. Plex and other local movie theaters.
Narrative
It was an extremely hot and humid day that was almost unbearable. This is why Tommy
decided to seek out the air conditioning and entertainment of a local movie theater.
Tommy checked the newspaper to see what options he had for movies at the time that
would best accommodate his schedule. The highly anticipated movie “The Governator”
was being shown at the local Royal 16 Theater complex in the Eastfield Mall. According
to the newspaper, the movie was scheduled to begin in 30 minutes, at 1:00 pm.
Tommy gathered his belongings and made his way to the movie theater. Tommy wanted
to be early to the movie because he always had a difficult time finding a seat in the dark.
Also, Tommy did not want to be late for the beginning of the movie.
After 15 minutes, Tommy arrived at the theater. While purchasing his ticket, Tommy
asked the cashier when the movie was scheduled to begin. The cashier told Tommy that
the movie would begin in 15 minutes, at 1:00 pm, the time posted on the marquee.
Tommy then proceeded with the transaction of purchasing his movie ticket. He was
dissatisfied with the price of the movie being nine dollars and that no discount was
offered for an early afternoon showing of the movie. Tommy was informed that the
theater owner would not offer a discount for the early afternoon showings of “The
Governator” because it was a long awaited blockbuster movie. Once Tommy received his
ticket of admission for the movie, he meticulously looked over the ticket and concluded
that the ticket stated that the movie would begin at 1:00 pm and contained no other
relevant statements.
Tommy was not a regular customer at the movies. He had not been to a movie theater for
several years since he was very busy. Tommy was a business major at a local university
and also worked around 20 hours a week. Attending classes, studying, and working left
him very little time for entertainment.
Once inside of the movie theater complex, Tommy reluctantly decided to stop at the
refreshment counter. After spending nine more dollars for a large tub of buttered
popcorn, a large iced soda, and a super-sized candy bar, Tommy hurried off to the theater
room that was showing “The Governator”.
At 12:58 pm, Tommy arrived at the correct theater room. He walked down the aisle,
found a substantial row, and headed for his selected seat. Once Tommy was sat in his
seat, he let out a big sigh of relief with ten seconds to spare. The lights dimmed inside of
the theater room and to Tommy’s absolute surprise commercials began instead of the
movie. Thus, Tommy became utterly outraged.
After twenty minutes of watching commercials, the movie finally began. Tommy decided
to watch the commercials since the movie theater was quite comfortable and air
conditioned. Very early into the movie, Tommy could already decipher that this was one
of the worst movies that Tommy would ever see in his life. Tommy decided to stick it out
a little longer just in case the movie surpassed his previous judgment. After thirty
minutes, the movie did not get any better and Tommy decided to leave the viewing room.
Tommy was disgusted. He had been forced to watch twenty minutes of commercials and
the movie was atrocious. Tommy found the manager and asked for his money back. The
manager explained to Tommy that it was the policy of the theater owner to not refund the
admission fee. Enraged, Tommy left the theater.
Tommy vowed that he would not let this occurrence pass without some resolution. “He
was sure that the theater violated his legal rights as well as the rights of other moviegoers,
particularly by showing all of those commercials”. Tommy returned to his residence,
where he found his Business Law textbook and began to analyze the situation and
consider which legal actions he could pursue.
Remembering some things from his Business Law course he had previously taken,
Tommy sent a letter to the owner of the Royal 16 Theater complex at the Eastfield Mall,
Mr. Mull T. Plex. In the letter, “Tommy expressed his dissatisfaction with the showing of
the commercials and indicated to Mr. Plex that he was going to pursue legal resource
including the possibility of filing a class action lawsuit”.
Issues
Because we have proven all the elements of fraudulent misrepresentation (theaters to the
moviegoers, and Tommy), we can infer that the consortium formed may run the risk of
spending a large amount of money trying to fight the dispute and possibly losing it.
Did the Royal 16 Theater commit fraudulent misrepresentation?(move this heading to
the bottom of Issues heading??)
According to the July at the Multiplex Case Library, “In order to maintain an action for
fraudulent misrepresentation, a plaintiff must allege and prove the following elements:
(1) that a representation of fact was made; (2) that the representation was false; (3) that
when made, the representation was known to be false or made recklessly without
knowledge of its truth; (4) that it was made with the intention that the plaintiff should rely
upon it; (5) that the plaintiff reasonably did so rely; and (6) that the plaintiff suffered
damage as a result”.
First, a representation that the movie was supposed to start at 1:00 pm was made in the
newspaper, on the marquee, and also by the cashier of the theater. Tommy read in the
newspaper before he left his house that the movie was going to start at 1:00 pm. While
purchasing his ticket, Tommy asked the cashier when the movie was going to begin. The
cashier responded that the “movie would begin in 15 minutes, at 1:00 pm, the time posted
on the marquee”. Tommy looked over his ticket of admission to the movie and saw that it
as well stated that the movie would begin at 1:00 pm.
Second, we will address the representation of the movie starting at 1:00 pm. Once
Tommy was seated in the theater and ready for the movie to begin at 1:00 pm,
commercials began instead of the movie. The movie officially began twenty minutes after
1:00 pm, at 1:20 pm. In order for customers to make sure that they are at the movie on
time, they will need to be there at 1:00 pm. Even though the official movie starts at 1:20
pm, customers will need to arrive to the theater show room at 1:00 pm in order to find a
seat before the lights turn off and to see the beginning of the movie. The Royal 16
Theater shows commercials at the beginning of the movie in order to not raise the price
per admission ticket. This way, consumers will be offered a lower price, while they relax
in an enjoyable atmosphere. Tommy already believed that nine dollars was a high price
for admission to the movie, but if the commercials were not shown in the beginning the
price for admission would possibly be raised even higher. The Royal 16 Theater did
represent that the movie would begin at 1:00 pm, but without the customers watching the
commercials additional revenue created from these commercials would decease, creating
a higher cost for admission to the movie.
Third, when the representation of the movie starting at 1:00 pm was made it was known
to be false or made recklessly without knowledge of its truth. The ad in the newspaper
would be either approved by the manager or the owner of the theater. The manager and/or
owner of the theater would most likely be informed of the commercials before the movie
because they would incur revenues from the showing of commercials. The employees at
the movie theater would know that the movie would begin after commercials were
shown. If not, the employees at the movie theater would be recklessly making this
statement without knowledge of its truth. In addition, the marquee on the outside of the
movie theater and the ticket of admission also stated that the movie began at 1:00 pm,
which was not the case. Mr. Plex and the consortium would be advised to offer a
disclaimer from the employees when questioned about when the movie will start. The
employees could inform the customers that there are indeed commercials at the scheduled
time of the movie, but if they would like to obtain a seat before the lights turn off and
make sure that they are there before the beginning of the movie then they must arrive
before 1:00 pm.
Fourth, the representation that the movie would begin at 1:00 pm was made with the
intention that Tommy and other customers would rely upon it. Publishing that the movie
would begin at 1:00 pm in the newspaper was a representation that the movie would
actually begin at 1:00 pm. By this information being in the newspaper, the theater
publicized this information with the intention of customers, such as Tommy, relying upon
the information. This way the Royal 16 Theater will be able to keep admission prices
relatively lower. If customers were not in the theater to watch the commercials, the Royal
16 Theater would not gain significant revenues, if any, for the showing of these
commercials. With extra revenue, the theater can keep the tickets prices as low as
possible and offer amenities such as air conditioning for the customers.
Fifth, the plaintiff, Tommy, reasonably did so rely. Tommy made sure that he was at the
theater early in order to have time to purchase snacks and beverages before the movie
began. Tommy made sure that he would arrive inside of the theater room showing the
movie with time to spare before 1:00 pm, so that he would not miss any of the movie. If
Tommy did not rely upon this information, he would have entered the theater when it was
dark and would have had trouble finding a seat. Tommy may have had to watch
commercials before the movie officially began, but he was able to find his seat before the
lights dimmed.
Sixth, the plaintiff, Tommy, suffered damages as a result. Tommy rushed to get to the
movie on time, so that he would have enough time to purchase snacks and beverages,
find his seat before the lights turned off, and have at least a few seconds to spare before
the lights went off. Believing that the movie would begin at 1:00 pm, Tommy was
enraged to discover that he had to endure twenty minutes of commercials before the
movie actually began. Shortly after the movie began, Tommy could tell that this was the
worst movie he had ever seen. He left before the movie was over and asked for a refund,
which he was denied of. Tommy suffered damages of the admission price to the movie.
Tommy consumed his beverage and snack, without any dissatisfaction or
misrepresentation. Therefore, Tommy is not owed any compensation for the beverage or
snack. Tommy had left the movie theater early, doing so he did not obtain a full movie,
which the price of admission is adjusted to provide and was dissatisfied with the movie.
Consequently, Tommy should receive a refund for the price of admission to “The
Governator”. Since Tommy was dissatisfied with the movie and also that the
commercials were shown at the advertised start time of the movie, the Royal 16 Theater
will incur less problems if they refund the dissatisfied customer, Tommy, his price paid
for admission. The contract between Tommy and the Royal 16 Theater is most likely a
common law contract, since the theater is offering Tommy a service. Due to the contract,
the Royal 16 Theater must provide a refund, because Tommy was dissatisfied with the
movie and did not watch the entire movie. Therefore, each party entered into the contract,
but Tommy did not receive what he first intended to pay for.
Assuming a Contract Exists Between Tommy and the Royal 16 Theater…
If we assume that a contract exists between Tommy and the Royal 16 Theater and that
one of the terms of the contract provides that the movie will begin at 1:00 pm, we can
infer that the Royal 16 Theater has committed fraud. Fraud is a deliberate
misrepresentation that causes another person to suffer damages. The contract would have
been violated between Tommy and the Royal 16 Theater since the movie did not actually
begin at 1:00 pm and actually began at 1:20 pm. The representations made by the Royal
16 Theater were not representations of fact. The movie did not start at 1:00 pm, which
was explicitly agreed upon in the contract between Tommy and the Royal 16 Theater.
What if the Royal 16 Theater Contained a Relevant Statement on the Admission
Ticket?
If the admission ticket contained a relevant statement about the commercials prior to the
beginning of the movie, this case would not be significant. Without a statement on the
ticket, the possibility that this case is an innocent misrepresentation is thrown out the
window. Since the lack of a relevant statement was made in many different advertising
and verbal aspects of the business, we can conclude that there has been intent to deceive
the general public in order for the general public to tolerate the commercials. The
customers of the theater have paid to view a movie. If the movie does not begin right
away, a general amount of customers will sit and wait until the movie does begin.
Customers paying to view a movie would not willingly watch commercials. If these
commercials are shown, a majority of consumers will not mind the commercials.
If the Royal 16 Theater informed customers that the movie would actually begin 20
minutes after the scheduled time, most customers would not attend viewing of the
commercials. This would reduce revenues from the commercial providers and incur an
increase in admission prices. Customers would not be happy about an increase in prices
and would most likely attend the showings of movies less often. This could potentially
drive the Royal 16 Theater out of business.
Statistical Inference
In order for Mr. Plex and the Consortium to settle the potential lawsuit, they would
require 10% of moviegoers to resent the commercials. If we conduct hypothesis testing
with a sample size of 150 people, and 12 people agree with Tommy, and resent the
commercials before the movie. We can see below that 8% of those surveyed resent the
commercials before the movie.
8%
Resent Ads
Do Not Resent Ads
92%
If we conduct hypothesis testing with a sample size of 400 people, and 24 people agree
with Tommy, and resent the commercials before the movie begins. We can see below that
6% of those surveyed resent the ads.
6%
Resent Ads
Do Not Resent Ads
94%
Case Library Reference
Referring to the July at the Multiplex Case Library, Lee P. Cao and Louann P. Cao v.
Huan Nguyen and Nega Pham, we can see that fraudulent misrepresentation took place.
The main issue in the case of Lee P.Cao and Louann P. Cao v. Huan Nguyen and Nega
Pham is that the buyers were unaware that the property could not be rented as a duplex
because the lot was not wide enough to comply with the municipal code. Also, the sellers
were aware that the buyers intended on purchasing the property and continuing the use of
the property as a duplex residence. The buyers had inspected the property multiple times
and observed that the property contained two separate units. The sellers informed the
buyers that they had previously rented both units in the past and that the residence had
been divided into two units when they had first purchased the house. The purchase
agreement between both parties described the property as a “duplex house”. Once the
buyers became the owners of the property, they applied for a building permit to construct
improvements on the property. Doing so, the buyers “were informed by the city building
and safety department that the property could not be used as a duplex or two-family
dwelling because the lot was not sufficiently wide to comply with the municipal code”.
Once this fact was ascertained, the buyers “sought rescission of the purchase agreement,
claiming that the sellers had fraudulently misrepresented to them that the property could
be rented as a duplex”.
When the definition of fraudulent misrepresentation is applied to this case, we find that
the property was represented as a duplex residence by the sellers to the buyers. Second,
the representation of the property being a duplex residence was made. This representation
is false since the property’s lot size is insufficient and does not uphold to municipal code.
Third, the representation was made recklessly without knowledge of its truth. “In this
case, the means of discovering the truth were not in the buyers’ hands. The buyers were
not provided with any information which would have placed them on notice that the
home did not meet the municipal code requirement for a two-family dwelling”. The
sellers advised the buyers that the house had been previously rented as a two-family
dwelling. The physical layout of the property implied that it was legally divided into two
separate living quarters. The sellers verbally explained that the property was divided into
two separate units, the advertisement of the property described the residence as a duplex,
and the initial contract that was signed by both parties portrayed the residence as a twofamily dwelling.
Fourth the representation of the property being a two-family dwelling was made with the
intention that the buyers would rely upon it. The representation that the property was a
duplex was made in the advertisement of the property. This means that only potential
buyers that were looking for a duplex residence and that were interested in purchasing a
duplex residence would look at the property and commit to purchasing the property.
Therefore, advertising the property as a duplex would only attract those interested in
purchasing a duplex. Fifth, the buyers did indeed rely upon the representation of the
property being a duplex residence. The buyers did indeed purchase the property with the
consideration that the property was a duplex. Once the buyers discovered that the
property was indeed not a duplex, they immediately sought rescission of the purchase
agreement. Sixth, the buyers have suffered damages of either purchasing additional
property to increase the lot size or remodeling the residence to house one family,
therefore losing remodeling costs and the income of one family.
Since the buyers have proved each element of fraudulent misrepresentation, they should
be granted rescission of the purchase agreement.
If we connect this example to our current case, we can see that Tommy could indeed
prove that the Royal 16 Theater has committed a fraudulent misrepresentation. In the case
library reference, the sellers displayed the house as a duplex residence, which it was
actually not. In our case, the Royal 16 theater displayed the start time of the movie at
1:00 pm, which it was actually not. The movie began at 1:20 pm. In the case library, the
ruling was in favor of the buyers. This means that Tommy could in fact win if the case
did make its way to the courtroom. Therefore, it is in the Royal 16 Theater’s favor to
refund Tommy of his admission ticket in order to prevent this case from reaching the
courtroom.
Conclusion
It is apparent that Royal 16 Theater has committed fraudulent misrepresentation.
Reviewing the definition of fraudulent misrepresentation, we see that “in order to
maintain an action for fraudulent misrepresentation, a plaintiff must allege and prove the
following elements: (1) that a representation of fact was made; (2) that the representation
was false; (3) that when made, the representation was known to be false or made
recklessly without knowledge of its truth; (4) that it was made with the intention that the
plaintiff should rely upon it; (5) that the plaintiff reasonably did so rely; and (6) that the
plaintiff suffered damage as a result”.
First, the representation that the movie was going to begin at 1:00 pm was made by the
Royal 16 Theater in the following ways: (1) the advertisement in the newspaper; (2) the
cashier at the ticket counter; (3) the marquee sign outside the theater; and (4) the ticket
provided for admission to the theater. Second, the representation that the movie started at
1:00 pm was false. Commercials began at 1:00 pm and the actual movie began at 1:20
pm. Third, when the representation of the movie beginning at 1:00 pm was made, the
representation was known to be false or made recklessly without knowledge of its truth.
The movie theater would be knowledgeable about when the movie would actually begin
and whether or not commercials were shown before the movie.
Fourth, the representation was made with the intention that the plaintiff, Tommy, should
rely upon it. By advertising the show times of the movies being screened at the Royal 16
Theater in the local newspaper and on the marquee outside of the front of the theater, the
Royal 16 Theater was representing such information with the intention that customers,
such as Tommy, would rely upon this misrepresented information. Fifth, the plaintiff,
Tommy, reasonably did so rely. Tommy checked the newspaper initially to discover the
time that the movie began. Once arriving at the movie theater, Tommy sought out to
confirm this information with the marquee on the front of the theater, the cashier, and
also the ticket provided to him for admission to the movie. Sixth, the plaintiff, Tommy,
suffered damages as a result. Tommy suffered financial damages for the price of the
ticket of admission to the movie. Also, Tommy could fight that he has suffered personal
damages relating to his valuable personal time.
Therefore, each element of fraudulent misrepresentation has been proven. This illustrates
that Tommy should be granted rescission of the purchase agreement with the Royal 16
Theater. The rescission Tommy would receive would include his entitlement to the return
of anything he has given the Royal 16 Theater. This would include the finances that
Tommy invested in the price of the admission ticket.
Statistical Research
Our research team has acquired valuable data that will give Mr. Plex and the
consortium factors to decide whether to fight the case or not. With a sample size of 150,
our team performed an analysis with a random sampling by asking people these two
questions: (1) how often do you go watch movies? (2) Do you dislike the
ads/commercials before the movies starts? Mr. Plex and the consortium have decided that
if the results were greater than 10% they will settle with Tommy. However, if the results
were less than 10%, they will proceed with the lawsuit against Tommy. The results of the
survey revealed that 12 out of 150 (8%) agreed with tommy and does not like
ads/commercials before the movies. Our results were found by using the one-sample
hypothesis testing.
Statistical Analysis for Sample Size of 150
Hypothesis:
-
Ho: P > .10 (Mr. Plex and consortium will seriously consider settlement)
-
H1: P < .10 (Mr. Plex and consortium will rigorously defend any lawsuit by
Tommy)
Analysis:
-
For this case, we use 0.05 as the significance level
o The level of significance is the probability of making a Type I error when
the null hypothesis is true as an equality.
Type I Errors occurs if Ho is true, and we reject it when it is true. That means if the
consortium decides to consider a settlement when greater than 10% does not like
ads/commercials is true and we reject the null hypothesis when in fact null hypothesis is
correct, then we will make a type I error.
Type II occurs if Ha is true and we accept Ho when it is false. That means if the
consortium will defend any lawsuit by tommy when 10% or less does not like
ads/commercials is true and we accept null hypothesis when it is false, then we will make
a type II error.
Analysis work
-
P = 10% (percentage for which Mr. Plex and consortium considers to determine to
settle with Tommy)
-
P^ = 8% (percentage of sample of those who agree with Tommy)
-
n = 150 (Patrons)
o Z =( ( 0.08 - .10) / ( (√.10(1 - .10) / 150) )
o Z = -0.8163

P-value = .4681
If 24 out of 400 agreed with Tommy and resented Ads
-
P = 10%
-
P^ = 6%
-
n = 400
o Z = ( ( 0.06 - .10) / ( (√.10(1 - .10) / 400) )
o Z = 0.015

P-value = .5040
Since .4681 is greater than the significance level of 0.05, we accept the null hypothesis. If
we had a sample of 400 patrons with 24 agreeing with Tommy, we get .5040 which is
greater than the significance level of 0.05, we accept the null hypothesis as well.
Conclusion
Our team concludes not to reject the null hypothesis, by rejecting the null
hypothesis, it will cause a type II error. Mr. Plex and the consortium should accept the
null hypothesis even though it is not true. If Mr. Plex and the consortium assume that
people would not be bothered by commercials/ads in the beginning of the movie, there
are possibilities that people can dislike it.
Strategic Recommendation
Based on our computations and statistical review of both samples of 150 and 400
patrons, we recommend Mr. Plex and the consortium to proceed and defend any lawsuits
made by Tommy.
Ethical considerations
What are the facts?
We must evaluate any ethical issues that may arise in this case to protect from the
possibility of further litigation and to uphold good business practices. Let us first look at
the facts in this case. The customer, Tommy, came to the theatre to get away from the
heat. He was disgruntled at the fact that there were commercials when that was neither
advertised nor mentioned on the ticket. He was also disappointed with the fact that the
movie theatre charged full price for a matinee ticket, and that he considered the movie
inferior to his expectations and hype. Because of this he demanded a refund. He was
denied the refund because it was against the policy of the theatre to give refunds.
Ethical issues
The ethical issues at hand are whether the movie theatre should show commercials and
how should they handle customers who demand refunds. Are they responsible for the
content of the movie? What information should they provide to the customer? Should
they charge full price for matinee movies because of the film’s popularity? These
questions are important when it comes to finding ethical solutions.
Principles, Values, and Possible Actions
Let us examine the classic “Categorical Imperative” proposed by Kant, and see where it
applies to this case. The Categorical Imperative is concerned with the direction of a
practice, is it a right or wrong direction. What if everyone took such an action? Let us
look at it first from the point of view of the theatre. If everyone asked and received
refunds because they did not enjoy a movie, or movie experience, then theatres would go
bankrupt, especially if the movie included Nicolas Cage. Thus it is not a moral imperative
that they give refunds.
Now let’s look at it from the point of view of the moviegoer. If we look at another related
ethical theory, the “golden rule” or “do to others what you want done to you”, we see that
we would probably want a refund if the movie was so terrible or disgusting that we
walked out halfway through. Thus this must be taken into considerations when dealing
with customers.
From the point of view of the “Rights Theory” we see that the theatre has the right to
make money off of commercials and charge the market rate for the movie, however the
buyer would also have the right to equal or similar information when conducting a
transaction, thus it is not unethical to show commercials and charge night prices for a
matinee, but we do recommend that buyers be given some information on the length of
the commercials to respect their rights.
From the point of view of the Utilitarian theory, which tries to give the most good to the
most people, we can see that having commercials gives people time to get to their seats
even if they are late. This might be very helpful and even necessary for people with
severe disabilities, stuck in traffic congestion, severe crowds, families with small children
or other obstacles to mobility and punctuality. This buffer of time allows them to be late
and still see the entirety of the movie. Also the temperature inside a theatre is tightly
controlled, so it is not unpleasant to be out of the rain, heat, hail or other inclement
weather, even if one is just watching commercials. Thus we can see that the commercials
perform a necessary role within theatres, as a way to tolerate tardiness or extenuating
circumstances and provide comfort and relief from the elements.
Recommendations
Based on our legal analysis, Tommy’s lawsuit against Mr. Plex and the consortium would
prove fraudulent misrepresentation under all six elements. Tommy would receive
compensatory damages for his financial loss suffered from his purchase of the admission
ticket, snacks, and beverages.
Based on our statistical research, our team strongly recommends that Mr. Plex and the
consortium defend any lawsuits filed by Tommy. From the results that were gathered
from a random sampled survey, 12 out of 150 people that were surveyed agreed with
Tommy on disliking ads or commercials shown before a movie started. Due to only 8%
out of the total number of people surveyed, Mr. Plex and the consortium should not settle
and go forth with defending against the lawsuit.
If the sample size was increased to 400, then only 24 people would have agreed with
Tommy about the displeasure of ads/ commercials. This is only 6% of the total number of
people surveyed agreeing with Tommy. Therefore, showing a lower number than the
previous sample size of 150 should encourage Mr. Plex and the consortium to continue to
go forth with Tommy’s case.
According to our ethical analysis, we recommend that Tommy should be compensated
for refunds on the ticket, snack, and beverages purchase based on the theories of the
“golden rule” and “rights theory.” The “golden rule” states that we should “do to others
what you want done to you.” Thus, refunds should be taken into consideration if
customers dislike their experience during a movie. In the viewpoint of the “rights
theory,” customers have the right to be informed if ads/ commercials will be shown
before a movie and the theatre has the right to make money off these previews.
Our team believes that is unethical for Tommy to be compensated for his losses because
according to the “Categorical Imperative” theory, if one person was given a refund then
anybody with a complaint should also be refunded as well causing the theatre to
bankrupt. Also, from a Utilitarian viewpoint, by showing ads/ commercials before a
movie it allows most people to take advantage of this expendable time to accompany any
necessary needs before the movie.
Appendix
Formulas and Computations:
Formulas:

Z-value Formula:
Computation:

Null Hypothesis = Ho : P > .10

Alternative Hypothesis = H1 : P < .10
Extras.
(add consideration to this report-mich)
Assuming that the contract does exist, Tommy should be refunded all commodities that
had been exchanged within the purchase agreement of the contract. This means that
Tommy should be refunded the money spent for purchasing the ticket, the money spent
for purchasing the beverages and snacks that Tommy believed would add to the ambiance
and experience of his movie going event, and a possible compensation for the valuable
time that Tommy has been deprived of.
Weakening the counter argument
Commercials often serve an important role in the whole theater experience. Tommy even
mentions that the cool of the theater was comforting and sheltering from the heat, they
also serve to inform theater goers about upcoming movies and events. People who are
stuck in crowds, traffic, and adverse parking situations are discriminated against if the
commercials are excluded. Even worse, people who have children or people who have
physical disabilities will be discriminated against if the movie did start exactly at the
listed time. The fact that the movie is listed at an earlier time than it actually starts; helps
give these people additional urgency and an excellent buffer for extreme or extenuating
circumstances. Thus this misrepresentation increases the net utility because there are
people who are disabled or hindered from arriving on time and because commercials can
be a relieving and informing experience for those moviegoers who do arrive on time.
This can be seen in the lack of complaint about the inclusion of commercials.