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Fingerhut, based in Minnetonka, Minnesota, is a direct-marketing company that sells a smorgasbord of consumer goods through an array of specially targeted catalogs. In November 1996, an article in the Star Tribune, a major Minneapolis newspaper, drew attention to a class-action lawsuit pending against Fingerhut that suggests the firm made its profits by exploiting the poor. Several civil rights groups rallied around the suit and submitted amicus curiae in favor of the litigation. The case illustrates issues in ethics and management communication. Discussions focus on the constituencies. Is Fingerhut exploiting its customers or providing them with an affordable method of obtaining valued consumer goods on credit? Do retailers have a duty to offer products at reasonable prices? Are the high interest rates reasonable given the risk? What are the options: pawn shops, rent-to-own? What is the profile of the typical Fingerhut customer? Discussions also focus on the issues communicating to the constituencies. How much damage will the lawsuit do to Fingerhut's image as an ethical, socially conscious company? What communication strategies can the firm employ? Should it react to the lawsuit? What should it tell its employees?

This case discusses Qihoo 360's free business model, how it used this free model to overpower competitors, and how the model evolved over time. Qihoo 360 is a company that took just six years to become a company listed on the New York Stock Exchange (with a market value of over US$ 2 billion). At Qihoo 360's Initial Public Offering (IPO) at the New York Stock Exchange (NYSE), Qihoo's founder Zhou Hongyi reflected on how Qihoo's free business model had brought its current success and speculates on its future challenges.

The authors used both secondary data and field interviews when preparing this case. After reading through various company reports, competitor information, and financial filings, the authors interviewed five top manager team (TMT) members of Qihoo 360, three TMT members of its competitors, and two partners of venture capital investors who have invested in these companies in Beijing or Shenzhen during the last three years. The authors collected 347 media reports related to these companies in Chinese covering seven years of history. This long span of data collection improves the interpretation of the company and helps construct the storyline of the case.

This case is suitable for an MBA course or an advanced undergraduate course in strategic management or a technology-oriented entrepreneurship course, focussing on the topic of the free business model, business model innovation, disruptive innovation, and evolution of the business model during the entrepreneurial process.