Legal Question in Business Law in Utah

Legality of Busines Practices

A is a national pizza chain. B is the catering department of a large local university. C is any individual within the employ of said university.

A has a deal providing discounted prices to B. B encourages C to do business through them rather than directly with A to utilize said discount. B charges C more than A charges B and pockets the rest. So far, so good. However, B misrepresents A's prices to C, and doesn't tell C about the markup. Furthermore, B has entered into a contract with A to do certain amounts of business each month. One of the stipulations of said contract is that A must not reveal to C the actual prices A gives B. Basically, B is lying to C and making a profit off of C without C's knowledge.

Has any illegal activity transpired in the above senario?


Asked on 1/25/07, 11:00 pm

1 Answer from Attorneys
Alvin Lundgren Alvin R. Lundgren, L.C.

Re: Legality of Busines Practices

Probably not. C is not compelled to do business, and does business based on his own expectations of a profit. B is allowed to negotiate and there are no apparent requirements for B to disclose honest prices. If B does not buy enough to meet the contract with A, then A has a remedy under its contract.

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Answered on 1/26/07, 10:28 am


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