Reference no: EM131308796
incouver-based retailer Lululemon experienced a problem with its $100 black luon yoga pants. They were too sheer, pilled easily, and customers were returning them. Chip Wilson, founder of the company, in an interview with Bloomberg TV stated, "Quite frankly, some women's bodies just actually don't work. It's really about the rubbing through the thighs, how much pressure there is over a period of time." Numerous media outlets picked up the story and a firestorm of negative comments on social media ensued. Four days later, Wilson apologized on Lululemon's Facebook page stating, "I'm sad for the repercussions of my actions. I'm sad for the people of Lululemon who I care so much about, who have really had to face the brunt of my actions...I'm sorry to have put you all through this."9 What mistakes did Lululemon make in handling this situation? What lessons can be learned? \
DISPUTE RESOLUTION
BUSINESS LAW IN PRACTICE
Marie Gagnon, referred to throughout Chapter 3, is the Director of Insurance and Security of Northland Mining Inc., a nickel mining company located in northern Manitoba. She has just returned from a well-deserved holiday in Mexico. For several weeks prior to her holiday, Marie was involved in revising Northland's legal risk man-agement plan using the approach outlined in Chapter 3. The basic elements of the plan are presented in Figure 3.3 on page 58. During Marie's absence, several events occurred that related to Northland's plan.
Marie is reviewing the following incident reports: . The delinquent customer. A customer failed to pay its account within the usual 30 days. When Northland investigated, it discovered that the customer was in serious financial difficulty. . The hacking attempt. An environmental activist group opposed to mining attempted to "hack" into Northland's computer system. Although there was no loss of data, there was some minor damage to Northland's network and it had to be shut down for leveral hours.
• The pollution inciRnt. A small amount of ash-laden dust from Northland's processing mill was blown onto a neighbouring farmer's land causing some damage to his crops and buildings. The 1..,rmer is irate and is threatening to bring legal action. He has tcld Northland that he intends to contact the media and environmental protection groups to let them know about what has happened to him.
• The machine breakdown. The conveyor belt on the continuous mining machine that cuts ore from the mine walls caught on fire. It will take at least three weeks for it to be fixed. Although Northland has insurance covering its losses, the insurance company is denying coverage.
1. How well does Northland's risk management plan deal with these incidents and how could its performance have improved?
2. How well does Northland deploy the various methods of dispute resolution in relation to the legal risks that materialized?
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