26. (15 total points) EACH OF THE FOLLOWING QUESTIONS REQUIRES EITHER A SHORT ANSWER OR A “YES” OR “NO” ANSWER, FOLLOW

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26. (15 total points) EACH OF THE FOLLOWING
QUESTIONS REQUIRES EITHER A SHORT ANSWER OR A “YES” OR “NO” ANSWER,
FOLLOWED BY ONLY A SHORT, ONE OR TWO SENTENCE,
EXPLANATION.
(a) Adam enters into a franchise agreement with Beta
Computers, Inc., in which Beta requires Adam to set up his store in
a particular location.
(i) (2 points) Is
this provision lawful? Why or why not?
(ii) (2 points) Suppose
that Beta desired to grant additional franchises in the same
territory. What could Adam have done to ensure that Beta was
restricted from doing so?
(iii) (2 points) Suppose that
Beta desired to open a corporate-owned store in the same
territory. What implied provision of the franchise agreement
might prevent Beta from doing so?
(b) Tina buys a Sports Grill franchise.
(i) (2 points) Sports Grill requires that all owners of
the franchises buy products for every phase of their operations
directly from Sports Grill. Is this requirement lawful? Why
or why not?
(ii) (2 points) Sports Grill also requires that all
owners of the franchises charge the same prices for their
food. Is this lawful? Why or why not?
(c) Diners Coffee Shops, Inc. sells franchises and imposes on
all franchise owners various standardized rules regarding not only
their operations but also their personnel hiring, firing, and
training practices. There was recently a complaint filed by an
employee of the Diners franchise restaurant located in
Monrovia. Specifically, after several incidents of racist
comments and conduct by the assistant manager at the Monrovia
restaurant, Sharon, a counterperson at that restaurant, resigned
and brought a lawsuit for racial harassment.
(i) (3 points) Can Diners Coffee Shops, Inc. be held
liable for racial harassment under these circumstances? Why
or why not?
(ii) (2 points) Suppose that Diners desires to
terminate the franchise under these circumstances. What is
the general legal requirement for termination under most franchise
agreements?