SeekingAdvice88
New Member
- Jurisdiction
- California
Hello,
The following situation was told to me by a third party at my company. I did not witness this event first-hand, nor did she. I am seeking to gauge the gravity of the issue.
I work for a manufacturer, and a colleague of mine entered into a bet with one of our distributors when he was paying an on-site visit. My colleague is our company's direct contact for this particular distributor, and he determines how many of our products are allocated to this distributor, based on the distributor's sales performance of the product that we produce. (We produce many different variants of our product, worth varying amounts of money.)
The bet centered around which person knew specific details of a new program our company had created. The distributor stated that he believed the policy details were "x". My colleague stated the policy details were "y". The distributor disagreed and said he'd been studying the details of the program, and that the rules definitely stated "x", and my colleague again challenged him, stating the rules were "y". The distributor asked, "You want to bet on it?" My colleague answered "Yes". The distributor stated that if he were correct, my colleague would allocate to him one of our high-demand products that is valued at over $140,000.00 (thereby giving the distributor a nice profit margin on the sale). My colleague asked what the distributor would offer if he were wrong, and my colleague were right. The distributor promised a specific number of sales of our products in the month of July (which may or may not include products that are valued as high as the one he was asking for in the bet). My colleague subsequently accepted the bet.
Both men looked up the policy details, and the distributor was correct.
Four days after this bet, the distributor felt very uneasy about the whole thing, and reached out to a different colleague of mine, and told her the entire story over the phone. She immediately told me about this bet.
The transaction has not been finalized: the asset that was the subject of the bet has not yet been transferred to the distributor. My colleague who lost the best recently transferred one of these high-demand products to a different distributor (due to their strong sales performance), but we have no idea if my colleague still may have intentions of providing this asset to the distributor with whom he made the bet and lost.
From what I gather, the distributor who suggested the bet did so in jest, not thinking my colleague would take it seriously, given the sheer value of the product. When both men discovered that the distributor had won the bet, my colleague who entered into the bet did not explicitly state, "Look, I was just joking" or "No way, this bet is off." He never stated that he had no intention of fulfilling the bet.
When the distributor told my colleague about the bet, he also told her that this event didn't happen in a vacuum, and that another one of our colleagues was present in the room during this on-site meeting. I don't know how much this other colleague may have heard, but it lends more credibility to the story that there was a third person in the same location when the bet was being made.
The colleague who made this bet and lost has no idea that the distributor told my female colleague about this bet, nor that she told me, and that now there are two other people who are aware of the situation.
Here's the question: although no transfer of the product has taken place yet, does the act of betting a corporate asset alone constitute a significant beach of compliance?
My female colleague is concerned that there could be ramifications for the distributor, even though he suggested the bet in jest, and even though he was the one to proactively report it to us because it made him uncomfortable. For that reason, she has not yet reported the bet to our legal department. There is the fear that no penalties would be levied against our colleague who lost the bet, and consequently, the distributor's relationship will be forever damaged with him, which will undoubtedly diminish both the quality and quantity of our products that my colleague would be willing to allocate to the distributor going forward.
Many thanks for your insight,
SeekingAdvice88
The following situation was told to me by a third party at my company. I did not witness this event first-hand, nor did she. I am seeking to gauge the gravity of the issue.
I work for a manufacturer, and a colleague of mine entered into a bet with one of our distributors when he was paying an on-site visit. My colleague is our company's direct contact for this particular distributor, and he determines how many of our products are allocated to this distributor, based on the distributor's sales performance of the product that we produce. (We produce many different variants of our product, worth varying amounts of money.)
The bet centered around which person knew specific details of a new program our company had created. The distributor stated that he believed the policy details were "x". My colleague stated the policy details were "y". The distributor disagreed and said he'd been studying the details of the program, and that the rules definitely stated "x", and my colleague again challenged him, stating the rules were "y". The distributor asked, "You want to bet on it?" My colleague answered "Yes". The distributor stated that if he were correct, my colleague would allocate to him one of our high-demand products that is valued at over $140,000.00 (thereby giving the distributor a nice profit margin on the sale). My colleague asked what the distributor would offer if he were wrong, and my colleague were right. The distributor promised a specific number of sales of our products in the month of July (which may or may not include products that are valued as high as the one he was asking for in the bet). My colleague subsequently accepted the bet.
Both men looked up the policy details, and the distributor was correct.
Four days after this bet, the distributor felt very uneasy about the whole thing, and reached out to a different colleague of mine, and told her the entire story over the phone. She immediately told me about this bet.
The transaction has not been finalized: the asset that was the subject of the bet has not yet been transferred to the distributor. My colleague who lost the best recently transferred one of these high-demand products to a different distributor (due to their strong sales performance), but we have no idea if my colleague still may have intentions of providing this asset to the distributor with whom he made the bet and lost.
From what I gather, the distributor who suggested the bet did so in jest, not thinking my colleague would take it seriously, given the sheer value of the product. When both men discovered that the distributor had won the bet, my colleague who entered into the bet did not explicitly state, "Look, I was just joking" or "No way, this bet is off." He never stated that he had no intention of fulfilling the bet.
When the distributor told my colleague about the bet, he also told her that this event didn't happen in a vacuum, and that another one of our colleagues was present in the room during this on-site meeting. I don't know how much this other colleague may have heard, but it lends more credibility to the story that there was a third person in the same location when the bet was being made.
The colleague who made this bet and lost has no idea that the distributor told my female colleague about this bet, nor that she told me, and that now there are two other people who are aware of the situation.
Here's the question: although no transfer of the product has taken place yet, does the act of betting a corporate asset alone constitute a significant beach of compliance?
My female colleague is concerned that there could be ramifications for the distributor, even though he suggested the bet in jest, and even though he was the one to proactively report it to us because it made him uncomfortable. For that reason, she has not yet reported the bet to our legal department. There is the fear that no penalties would be levied against our colleague who lost the bet, and consequently, the distributor's relationship will be forever damaged with him, which will undoubtedly diminish both the quality and quantity of our products that my colleague would be willing to allocate to the distributor going forward.
Many thanks for your insight,
SeekingAdvice88
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