EPE

EPE

Subject: Business
Ellen Carson is the author and illustrator of a successful series of children’s books that chronicle
the adventures of Ellasaurus, a 4-year-old orange dinosaur. Ellen has done well with the books,
but her business advisors have told her that she could earn considerably more money by creating a merchandising business around the Ellasaurus character. Following this advice, she has
created Ellasaurus Products Enterprises (EPE), a company that has begun developing and
marketing Ellasaurus toys, stuffed animals, coloring books, pajamas, and Halloween costumes
from its location in Flint, Michigan.
EPE has had some success in its attempts to get major retailers to stock the Ellasaurus
product line, but Ellen is concerned that retailers might not be willing to take on a new and
unproven product. She would like to create a Web site through which EPE could sell its merchandise directly to customers. She also sees the Web site as a way to build customer loyalty.
Ellen envisions a site with a number of portal features in addition to the product sales. For
example, she would like to offer online games, chat rooms, e-mail accounts, and other activities
that would promote EPE products and her books.
The Ellasaurus book series appeals to children who are between 4 and 6 years old. Ellen
expects the EPE product line to appeal to children in about the same age range. Ellen has visited sites such as Hello Kitty and Nick Jr., which appeal to similar age groups, to get ideas for
the site. She would like the site to be appealing to her main audience, but she would like to
obtain registration information from site visitors so EPE can send e-mails with information about
new products and Web site features to them.
Ellen plans to limit the Web site’s merchandise sales to U.S. residents at first, but she
hopes to begin selling internationally within a few years. The site will allow visitors from any
country to register and participate in the online portal features.
Required:
1. Ellen will use some copyrighted illustrations from her books on the Web site. She will also
include themes from the story lines of her books in some of the games that will be available (free) on the site to registered visitors. Prepare a report in which
you discuss at least two intellectual property issues that might arise in the operation of the
Web site.
2. describe the ethical issues that Ellen faces because of the ages of
her intended audience members.
3.outline the laws with which the site must comply when it registers site
visitors under the age of 13. Include recommendations regarding how Ellen can best
comply with those laws.
4.describe the sales tax liabilities to which the Web site will be
exposed. Assume that Ellen will operate the site from the EPE headquarters location in
Michigan and that EPE will manufacture the merchandise in Texas. The merchandise will
be warehoused at EPE distribution centers in New Jersey, Ohio, and California.
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