Reference no: EM132249393

Oscar, sole owner and proprietor of Uncle Oscar’s Skinny Lemonade Stand, has turned his business from a small shop to a nationwide beverage superstore. Although he experienced what seemed like overnight success, many competitors have come along attempting to replicate Oscar’s success. In an attempt to regain some of his lost market share, Oscar wants to drive Gob’s Lemonade Stand out of business. Oscar focused on Gob’s business because Gob sold his drinks for $1.00, which forced Oscar to lower his prices from $2.00 to $0.75. Once Gob went out of business, Oscar immediately raised his lemonade prices back up to $2.50. Now, having cornered most of the lemonade market, Oscar turns his attention to other money-making ventures. He starts trading stocks during the day, from his office at the back of the lemonade stand. One day, his old girlfriend Lucille calls him to let him know that her publicly traded business, Mama’s Car Wash (stock ticker MCW), has been having record profits and that their recent earnings (which will be announced next week) far surpassed expectations. Oscar gets off the phone with Lucille and immediately purchases 1,000 shares of MCW. When earnings are announced the following week, Oscar makes a 30% profit. What is Oscar’s (or his business’) potential legal liability for (1) any actions subsequent to and/or including the purchase of Gob’s Lemonade Stand and (2) Oscar’s trading of MCW. In your answer include: the specific common law, rules, statutes or other legal precedent involved, define the law/rule/statute/precedent at issue and explain how it applies to Oscar’s situation.