As a manager employed by Right-Now Rapid Delivery Service, you are responsible

As a manager employed by Right-Now Rapid Delivery Service, you are responsible for pricing the services involving same-day deliveries. You are primarily concerned with the competitive aspects of your business. You have proposed contractual language that states:

“any package picked up after 10:00 a.m. will be considered as if it is picked up the next business day. Any package delivered before 10:00 p.m. on the day of pick up will be considered to have arrived on that business day. Under the language, a package received at 11:00 a.m. on Tuesday and delivered by 10:00 p.m. on Wednesday is considered, by you, to involve a “same-day delivery.”

The impact of this language is that a business day lasts for as long as 36 hours; thereby giving a customer the wrong impression of the phrase “same-day delivery.” The Federal Trade Commission (FTC), under its authority to protect the public from unfair or deceptive trade practices, has contacted your company asking questions about the plain meaning of “same-day delivery.”

In anticipation of a face-to-face meeting with an FTC investigator, you strive to answer these questions:

(1) To what degree does the FTC have authority to question your business practices?

(2) Are your clearly stated contractual provisions unfair or deceptive?

(3) Should you cooperate with this investigator or seek a court order enjoining this investigation?

(4) How do you challenge the FTC’s action if a formal complaint is filed against your company?