PROBLEM: You are an attorney and your old friend John contacts you. John has rec

Question

PROBLEM:

You are an attorney and your old friend John contacts you.   John has recently started his own business to sell a new product he has developed.   The product is a new design for small, light-weight personal headphones, as would be used with an smartphone, digital tablet, MP3 player or a radio. His questions to you concern several issues of what he should look for in creating contracts for his business.

Question:

(3.)   John plans to sell $10,000 worth of his headphones to one (1) buyer (the XYZ Store chain) for resale purposes.  Must that contract be in writing? Please explain why or why not, in detail and mention and explain any contract doctrines which may apply.

Explanation / Answer

Yes, there has to be a written contract, due to the following issues

Warranty - It has to be specified who will cover the warranty, the manufacturer of the seller

Use of logo - The retailer needs permission from John to sell with his logo

Tax - There will be tax implications of the transactions and hence a written contract is inevitable.

First sale doctrine is applicable in this scenerio. The retailer has every right to sell or not sell once he has legally purchased it from John. However, he is not allowed to reproduce any proprietary technology that John may be using in his headphones

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