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Roald Dahl's "Charlie and the Chocolate Factory" turned 50 this year, and business owners could learn a thing or two from how Willy Wonka runs his factory.
From a legal standpoint, Wonka's business is one giant lawsuit waiting to happen, and the whole thing is premised on inviting children into direct harm. But on top of being fictional, this business owner had some rather keen ways of keeping his business out of court.
Check out these five tasty legal lessons from "Charlie and the Chocolate Factory" (both the book and the movie versions):
1. Use Enforceable Liability Waivers.
Before the five lucky winners of Willy Wonka's contest can enter the highly secretive chocolate factory, the eccentric entrepreneur makes the kids and their guardians sign a giant contract. The wall-sized document includes (among other provisions) a liability waiver for "accidents" that occur inside the factory. Although contracts signed by minors are voidable, courts tend to enforce liability waivers so long as they aren't overbroad. For Wonka's purposes, so long as Augustus Gloop fell into the chocolate river by the negligence of the factory (there could have been railing), the waiver might be enforceable.
2. Nondisclosure Agreements Are Gold.
Worried about your competitor Slugworth stealing all your best ideas? Just make your employees and guests sign nondisclosure agreements. They can protect your company secrets without a single Oompa Loompa.
3. Word Your Contests Carefully.
You'll want to follow nonfictional legal rules to keep your contests or promotions legal, like making sure that there's "no purchase necessary" to enter. Wonka's contest could have been deemed an illegal lottery because it required participants to buy something in order to get a golden ticket.
4. Give Your Company a Way Out.
Charlie and Grandpa Joe violated the agreement with Wonka by wandering off into the Fizzy Lifting Drink area and were then treated to a very poignant "You lose!" by Wonka. Your company won't be in this exact situation, but you'll at least want an enforceable arbitration provision just in case there is an issue with one party breaching.
5. Prepare to Settle.
Although you may not remember it from the movie version, at the book's finish, the kids who met various "accidents" are all given a lifetime supply of chocolate. Sometimes, even when the law is on your side, settlement is the best way to resolve legal disputes and save customer goodwill.
And since you don't run a magical chocolate factory, you should have a business attorney on hand.