BLAW FINAL EXAM REVIEW

Registration statement

Registration of securities is intended to provide investors with sufficient information about important facts regarding the security interest that a company is proposing to sell. With that financial information, investors can make an informed decision about the merits of new securities before buying them.

508 - Clean air act - how is it enforced? Fed comes up with certain things that must be regulated The states come up with their own plan to do it and the EPA will see if that is okay every once in a while and the states take over

The EPA is an oversight agency that sets limits on what the states may do and sets the minimum regulations they must impose. When the EPA changes emission standards, states must revise their SIPs, which are then reviewed by the EPA.

Judicial Review 415,420

- chevron case establishes the principle of deferis The APA sets the procedural requirements for a party seeking court of appeals review of an agency decision. Most appeals concern the legitimacy of regulations and whether a penalty issued by an agency for a violation was justified. That appeal is referred to as judicial review, an external check on agency power. This ensures that agencies follow required procedures, do not go beyond the authority granted them by Congress, can jus- tify their actions, and respect constitutional rights.

Vertical price fixing

-No longer per se illegal. Since the Leegin case, it has been subject to a rule of reason analysis. That is, when a manufacturer imposes resale prices, such as retail prices to be set by stores on certain products, the courts look to see if the practice in a particular case is destructive to competition or not. As the Court explained, intrabrand competition must be considered as well as interbrand competition.

The Clean Water Act (CWA) was passed in 1972 and was substantially amended in 1977 and 1986. The objective of the Clean Water Act is to "restore and maintain the chemical, physical, and biological integrity of the Nation's waters." The Act has five main elements:

1. National effluent (pollution) standards set by the EPA for each industry 2. Water quality standards set by the states under EPA approval 3. A discharge permit program that sets water quality standards to reduce pollution 4. Special provisions for toxic chemicals and oil spills 5. Construction grants and loans from the federal government for publicly owned treatment works (POTWs), such as sewage treatment plants

474- Equal credit opportunity act - you cant deny credit for certain reasons read bullet points

4 Bullet points - credit report, errors credit reporting acts Because this provision is broad, Regulation B, issued by the Federal Reserve Board, provides rules explaining what is unlawful discrimination: • A creditor may not make statements related to a prohibited basis to discourage a person from applying for credit. • A creditor may not use information concerning the likelihood that the applicant may have children or that the applicant is likely, for that reason, to have reduced or irregular income. • Credit history must, at the applicant's request, consider not only the applicant's direct history but also the applicant's indirect credit history (for example, accounts that the applicant was liable for and accounts listed in the name of a spouse or for- mer spouse that reflect his or her credit history). • A creditor may not request information about a spouse or former spouse of the applicant unless: (1) the spouse will use the account or will be liable for the debt; (2) the applicant is relying on the spouse's income or on alimony or child support from the former spouse; or (3) the applicant lives in a community property state. A violation of ECOA exists if a creditor used a factor prohibited by the Act. The con- sumer can sue the creditor for ECOA violations. If successful, the creditor is liable to the consumer for actual damages, limited punitive damages, attorney's fees, and court costs, whether the discrimination was intentional or not.

498 Boycott question They boycott the retailer and that would be illegal Radio not playing dixie chicks because of their political statements, that is not illegal Other than boycotting against political views - all illegal

A boycott occurs when a group conspires to prevent the carrying on of business or to harm a business. It can be promoted by any group—consumers, unions, retailers, wholesalers, or suppliers—who, when acting together, can inflict economic damage on a business. The boycott is used to force compliance with a price-fixing scheme or some other restraint of trade. Boycott cases usually fall under the per se rule against price fixing. Unlike other vertical restrictions in which one manufacturer negotiates with individual dealers about terms of trade for its goods, boycotts may involve manufacturers getting together to tell dealers what they must do, or dealers getting together to tell manufacturers what they must do. The Supreme Court has made it clear that when horizontal competitors use a boycott to force a change in the nature of a vertical relation- ship, there is a per se violation of the law. Such cases are not common.

Cartel

A collection of rival firms that come together by some form of agreement in an attempt to restrain trade by restricting output and raising prices is. ex: Organization of Petroleum Exporting Countries (OPEC), (the group of oil-producing nations that banded together to control oil output. Because that cartel consists of sovereign nations, American antitrust laws do not affect it. When private firms attempt to cartelize an industry, they are subject to antitrust law)

545 Letter of credit question - what is it? Seller standpoint

A letter of credit is an agreement or assurance by the bank of the buyer to pay a specified amount to the seller upon receipt of certain documents that prove that the goods have been shipped and that contractual obligations of the seller have been fulfilled. The documentation usually required may include a certificate of origin, export license, certificate of inspection, bill of lading, commercial invoice, and insurance policy. Once the bank has received the required documentation, it releases payment to the seller. Letters of credit can be either revocable or irrevocable. As the label attached to each implies, a revocable letter of credit may be withdrawn before the specific date stated on it, while an irrevocable letter of credit may not be withdrawn

Per-se violation - #1 per-say violation is fixing prices

A per se rule means that certain business agreements or activities AUTOMATICALLY are held to be illegal if found to exist. A rule of reason, in contrast, means that the court looks at the facts surrounding business practices before deciding whether it helps or hurts competition. The court considers such factors as the business reasons for the restraint, the position in an industry of a firm accused of a restraint, and the structure of the industry. If a court concludes that a business practice promotes competition, the court dismisses the case. But if the court finds that the practice on net reduces competition, then the court rules that it violates the antitrust laws.

432,433 - What is a security - investors investing in a common enterprise but they don't do the work HOWIE case memorize the howie case

A security is almost always one of two things: First, it may be debt of certain forms, primarily money borrowed by a corporation usually as note or bond that can be traded. Second, it may be equity, the most well known being common stocks traded on stock exchanges. Securities provide capital for business operations, i.e., the money needed to get a business started or increased in size. Securities are usually records in computers that represent value in something real. The Howey test developed by the Court is still the critical test. An investment is classified as a security for the purpose of federal regulation if it contains four basic elements: 1. The investment of money 2. In a common enterprise 3. With an expectation of profits 4. Generated by the efforts of persons other than the investors

Non Point Source Pollution

About half of all water pollution is from nonpoint sources—it is runoff from construction sites, logging and mining operations, streets, and agriculture. Pollutants are washed by rain into streams and lakes and seep into groundwater. Much nonpoint source pollution has only recently come under control efforts. The complexity of the problem re- quires multiple solutions. Nonpoint source pollution is often very expensive to treat because there is no easy way to capture the contaminated water to treat it.

411- publish new rule of federal register allows for written comments

After a new rule is approved and published in the Federal Register for public inspection, interested parties may submit written comments about the rule. The public comment period is usually 60 to 90 days, after which the agency reviews the comments and finalizes the rule. Most substantive comments are contributed by trade associations and other professionals with expertise in the affected industry. These comments, which tend to be technical, are important because they form the basis of most legal challenges to rules. Submitting the comments is proof that the agency was put on notice of alleged defects in a rule. Once the agency issues a final rule, it may be appealed to the agency itself after the appeal is made to the court of appeals. Chevron case regarding the clean air act

Responsible parties of abandoned dumpsites

An abandoned dumpsite might contain hazardous wastes contributed by many waste generators. In addition, the dumpsite may have been operated by different parties over the years. Under the law, there are likely to be multiple potentially responsible parties (PRPs). The EPA publishes a "PRP Search Manual" to give guidance on finding parties who may be brought into a Superfund site cleanup. CERCLA defines PRPs, who can be held liable for both cleanup costs and damages to natural resources, to include: 1. Current owners of a hazardous waste site 2. Prior owners of a site at the time of hazardous waste disposal 3. Any hazardous waste generator who arranged for disposal at the site 4. Any transporter of hazardous waste who selected the site for disposal The parties may be held strictly and jointly and severally liable for these costs; that is, each party can be liable for the entire cleanup cost regardless of the size of its contribution to the hazardous waste at the site. As a result, each party has a strong incentive to identify other PRPs, which often results in lengthy, expensive litigation.

Reviewability 421, 425

An agency action that is challenged must be review able by the courts. Administrative agencies must follow required procedure rules or risk being found by the reviewing courts to have acted arbitrarily. Furthermore, agencies may not exceed their regulatory objectives or risk being found to have violated the duties they were as- signed by Congress. For these reasons, the APA authorizes the courts to review most agency actions. However, judicial review is not available if prohibited by statute or is a matter of agency discretion

Resale Price Maintenance

An agreement between a manufacturer, a supplier, and retailers of a product under which the retailers agree to sell the product at not less than a minimum price is called resale price maintenance (RPM). One purpose of these arrangements is to prevent retailers from cutting the price of a brand-name product. Although manufacturers may contend that such arrangements make product distribution more efficient or competitive, such arrangements can be an illegal restraint of trade.

Electronic Fund Transfer Act

As electronic innovations developed, Congress became concerned about the rights and liabilities of the consumers, financial institutions, and retailers who use electronic fund transfer systems. The Electronic Fund Transfer Act was passed and required the Federal Reserve Board to write Regulation E to implement the Act.

521- Pollution case in Cleveland - the site they picked had pollution on it so they didn't buy it- brown fields

Because of the nearly unlimited liability for unknown cleanup costs, no one wants to buy a site that might have to be cleaned up and so, useful property sits abandoned. For example, the Cleveland Plain Dealer built a new plant for newspaper production on farmland outside the city. The Plain Dealer had also considered an abandoned urban site, but it was found to have chemicals in the soil from years before. Such old sites are referred to as brownfields. The newspaper could not risk Superfund liability, so it moved out of town rather than run the operation in downtown Cleveland, where it would have helped restore the area.

Fair Credit Billing Act (FCBA).

Before the Act, some consumers complained they were unable to get creditors to correct inaccurate or unauthorized charges that appeared on their bills. Another problem was that credit cards were sent to people who did not request them. Some cards were lost or stolen, and consumers who never requested the cards were billed for unauthorized purchases. The FCBA addresses these problems: 1. In case of a billing error, a consumer must notify the creditor in writing within 60 days of the billing of a disputed charge. The creditor must answer the complaint within 30 days of receipt and has 90 days to resolve the problem and notify the consumer. 2. It prohibits the mailing of unsolicited credit cards. 3. It establishes procedures to report lost or stolen credit cards. Liability for unautho- rized charges is $50.

537 What is dumping? Anti dumping orders

Congress is concerned with foreign companies that sell their products at prices lower in the U.S. market than in their home market—called dumping—or receive a sub- sidy from their government to lower costs of production, so they can produce more goods to sell in other countries. Dumping is the practice of charging a lower price in the export market than in the home market, after taking into consideration important differences in the sale (such as credit terms and transportation) and the nature of the goods being sold. If it is determined that goods from a country are being dumped, and domestic industries are losing sales as a result, an anti-dumping order may be issued. Under this order, the incoming goods may be subject to an anti dumping duty or tax. The amount of the duty is determined by comparing the market price in the home market with the price charged in the United States. The difference between the two prices determines the tariff to be applied to the price of the product.

Arbitrary

Courts uphold what the agency will do As the Supreme Court explained in the Chevron case earlier in the chapter, the courts yield to the agency's judgment in technical and scientific matters in working out the details of regulations. The courts generally do not find that an agency's actions or decisions are arbitrary and capricious, or an abuse of discretion, if the following are true: −The agency has sufficiently explained the facts and its policy concerns. −Those facts have some basis in the agency's record. −On the basis of those facts and concerns, a reasonable person could reach the same judgments the agency has reached.

why do we have administrative agencies?

Creation of new agency- needed experts An administrative agency is created by a delegation of legislative power to the executive branch. Congress or the state legislature enacts a law that directs the agency to issue regulations, bring lawsuits, and otherwise act to fulfill the law's goals. Within the boundaries set by the legislature, administrative agencies exercise their powers to enact regulations, supervise compliance with those regulations, and adjudicate violations of regulations. Regulations issued by administrative agencies are among the important sources of law affecting the legal environment of business today.

509 - Question about clean air act Building a new factory in a dirty air area There is a difference in clean area and dirty - if you build one in a dirty area (non attainment area) what do you have to do?

Dirty air areas are called non attainment areas, meaning that they have not met the NAAQS. Businesses wanting to build in non attainment areas are required to meet more restrictive standards than are imposed in PSD areas. The emission offset policy imposes three requirements on owners of new or expanded plants: 1. A new plant's pollution must be controlled to the maximum degree possible. The plant must use the lowest achievable emissions rate (LAER) technology. LAER can be a cleaner technology than the BACT requirement. Generally, the EPA designates the LAER as the cleanest emission technology in use by any similar plant. 2. New plant owners must certify that any other plants they have in the area meet SIP requirements. 3. A new plant can be built in a nonattainment area only if any increase in air pollution from the new plant is offset by reductions in the same pollutants from other plants in the area. That is, when the new plant is operating, the area must enjoy an overall air quality improvement.

Clayton Act

Enacted in 1914, the Clayton Act was added to the Sherman Act. The Clayton Act is intended to stop a business practice early in its use to prevent a firm from becoming a monopoly by making practices that "substantially lessen competition or tend to create a monopoly" illegal. a monopoly exists in a market when one firm or only a few dominate the sales of a product or service. As we see in this chapter, the fact that a company obtains such a position is not necessarily illegal. The laws focus more on actions that show an effort to eliminate competition.

Foreign trade zone- You can avoid paying a terif if your intent is to bring in a product, assemble it, and send it out and sell it in a different country after you assemble it

Foreign trade zones are areas where businesses can import goods without paying tariffs. The zone is a secured area where goods may be processed, assembled, or warehoused. Tariffs are imposed only on the finished product, generally a much lower amount than what would be imposed on individual parts, and only when the product leaves the zone for sale in the domestic market. Products exported from the zone to other countries are generally not subject to tariffs.

Resource conservation and recovery act

How toxic substances are handled once they are in the market and when they are discarded is the concern of the Resource Conservation and Recovery Act (RCRA) passed in 1976 and amended in 1984. "Out of sight, out of mind" was standard procedure for the disposal of many hazardous wastes before the environmental consequences of improper disposal were understood. RCRA requires that hundreds of thousands of generators, who create millions of tons of hazardous waste each year, comply with an EPA regulatory program dealing with the transportation, storage, treatment, and disposal of hazardous waste to reduce danger to health and the environment.

Regarding restrictions on imports- what cant you import into the country (certain weapons, drugs, are banned)

Importing certain products may be illegal. For example, some explosives and weapons cannot be imported. Banned products, such as narcotics, violate domestic laws and cannot legally be imported. Products made from endangered species are prohibited. Other items may not meet safety regulations or pollution requirements and cannot be imported. For example, foreign vehicles that do not meet U.S. safety or pollution standards are banned.

Dr Miles Case

In 1911, the Supreme Court pronounced a basic rule about RPM. It stated that once a producer or supplier sells a product to a retailer, it could not control the price the retailer charges consumers. In Dr. Miles Medical v. John D. Park and Sons (220 U.S. 373), the court held that a manufacturer can, of course, sell its product for whatever it wants, but it cannot "fix prices for future sales." That is, it cannot set prices further down the sales chain.

Doctrine of sovereign unity question- you cannot sue a country in the courts of another country

In international law, sovereign immunity doctrine allows a court to give up rights to jurisdiction over foreign enterprises or countries. The doctrine is based on traditional notions that a sovereign should not be subject to litigation in a foreign court. As a result, investors may not be able to obtain relief in their country's court system. Under international law, [countries] are not immune from the jurisdiction of foreign courts insofar as their commercial activities are concerned, and their commercial property may be levied upon for the satisfaction of judgments rendered against them in connection with their commercial activities.

Insider trading - if they are benefiting from a trade because they have access because of their job it is illegal

Insider trading is illegal when a person trades a security while in possession of material nonpublic information in violation of a duty to withhold the information or refrain from trading. it is not only company heads who may be convicted of insider trading, but rather, a range of people with an obligation not to use such information for personal gain may be subject to criminal prosecution.

Wetland Mitigation Banking

It is common for trading to be done—a builder "buys" other wetlands, or restores wetlands, in exchange for the right to fill some wetlands. This is referred to as wetlands mitigation banking. As the EPA explains: "A mitigation bank is a wetland, stream, or other aquatic resource area that has been restored, established, enhanced, or ... preserved for the pur- pose of providing compensation for unavoidable impacts to aquatic resources permitted under Section 404 or a similar state or local wetland regulation."

Administrative agencies perform all functions of government Regarding hearing cases- informal - no jury, more relaxed, not like a trial

Legislative / Rule Making Power Investigative Power Adjudicatory Power Enforcement Power

549 Expropriation - country you build a factory in, the government ceases it. You have to buy insurance to avoid this

Like nationalization, expropriation is the action of a country in taking foreign property in accordance with international law. Most countries agree that for a valid expropriation, there must be adequate compensation provided. International law recognizes a country's right to expropriate the property of foreigners within its jurisdic- tion, so long as payment is made. If a takeover is unlawful, it is a confiscation. An all-risk insurance policy can provide financial relief in the event of nationalization, or if other problems occur. Short-term private insurance usually lasts from three to five years and is available for most investments. In addition, sellers may obtain rejection insurance in the event that a buyer rejects a product for reasonable cause, such as spoilage at sea.

495 - Leegin case- Brighton made a expensive purse and the store in Lewisville didn't want to abide by the rule by selling at a discount. Can a retailer do that? Yes bc that promotes inter brand competition. Known as -Resale price maintenance

Minimum resale price maintenance can stimulate interbrand competition—the competition among manufacturers selling different brands of the same type of product—by reducing intrabrand competition—the competition among retailers selling the same brand. The promotion of interbrand competition is important because "the primary purpose of the antitrust laws is to protect [this type of] competition." Resale price maintenance also has the potential to give consumers more options so that they can choose among pricing and services.

486 Why is monopolization bad? Read that paragraph

Monopolies not only tend to charge higher prices but also offer inferior service and are slow to innovate. Mergers are a source of monopolization concern. If companies that are competitors merge, will competition be significantly injured? A merger involves two or more firms coming together to form a new firm. A combination can be created by one firm's acquiring all or a large part of the stock or the assets of another firm.

Well known season issuers - issuer of stock has to wait 20 days to start selling, but well known season issuers don't have to wait

Most securities are issued by well-known seasoned issuers (WKSIs). Formally, these are securities issuers that have offered at least $1 billion in debt securities previously or have a public-equity market capitalization of at least $700 million. This includes most well-known securities firms. They can file registration statements the day they announce a new offering, rather than submitting it beforehand to the SEC; there is no need to wait for SEC staff review. This does not make their securities exempt, but simplifies the registration process and makes it consistent with EU (European Union) securities rules for such issuers. Further, WKSIs may use a free-writing prospectus that allows them to continuously update information, and it may be done on the Web. The standards are the same as for a traditional formal prospectus, but this allows communication with potential buyers at any time. Such securities are said to be under a shelf registration. That is, once registered, they may be sold at any time over the next three years. This helps firms market securities when conditions are favorable and when the firm needs the cash, rather than sell the entire issue immediately.

Nationalization

Nationalization is when a country takes over, or nationalizes, a foreign investment in a country. The compensation paid by the government is often less than the true value of the business.

Liability for Stolen Cards

One important protection provided by the Act is the liability limit when a consumer's ATM card is stolen and an unauthorized user drains the account. Unlike the Fair Credit Billing Act's $50 limit on liability for lost or stolen credit cards, the Electronic Fund Transfer Act's limit on liability is potentially greater. Regulation E provides that the consumer's liability is no more than $50 if the financial institution is notified within two days after the consumer learns of the theft. The consumer's liability becomes $500 as long as the financial institution is notified within 60 days. If the consumer does not report the theft within 60 days after receiving the first statement containing unauthorized transfers, the consumer is liable for all amounts after that.

521- Superfund .... Clean up clause- pollutions

Person who put the pollution there, transferred it there, they can be liable for the pollution 4 potentially responsible parties of who could be liable. Pick from the list After publicity rose concerning hazardous waste at abandoned waste sites, Congress enacted the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) in 1980. Called the Superfund, the Act provides the authority to clean up abandoned hazardous sites. Congress amended the Superfund program in 1986 with the Superfund Amendments and Reauthorization Act (SARA). Private parties incur much of the cleanup costs. Over the years, the EPA has evaluated tens of thousands of sites and, using a Hazard Ranking System, put those deemed most in need of action on the National Priority List (NPL). Those are the locations that receive the most attention. Some sites cost a few million dollars to clean up; others run as high as half a billion. The EPA has completed the cleanup at hundreds of sites; about 1,300 sites are in various stages of work.

FIFRA Federal insecticide, Fungicide, and Rodenticide Act

Pesticides are used to repel, kill, or disable pests, including undesirable plants, insects, rodents, fungi, and molds. Most pesticides are toxic to people and the environment if improperly used. Congress originally passed the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA) in 1947 and has amended it several times since. Registration means that before a pesticide is sold, the EPA has examined scientific data from multiple tests about a product's effects

Loss of Investment

Political upheavals, unstable monetary systems, and changes in laws are some of the risks encountered in other countries. In addition, businesses must be concerned about the loss of investment by nationalization, expropriation, and confiscation.

What has to be in the registration statement? Memorize the list

Prospectus (condensed version of registration statement): The security issuer's finances and business • The purpose of the offering • The plans for the funds collected • The risks involved in the business venture • The promoters' managerial experience and financial compensation • Financial statements certified by independent public accountants 2nd part-Regulation S-K: More history on the financial background and past experience of the issuers is required. There is also more information about the proposed business and the issuers. Investment analysts who want to see more detail may use this information, and the disclosure document is available for public inspection.

This manifest system document of where the pollution is goes through a process and the start is the factory. It should send the copy of the document back to the factory, and if not the EPA comes in to find it

RCRA forces compliance by hazardous waste generators, transporters, and TSD site owners through a manifest system. The producer of a hazardous waste must complete a manifest—a form that states the nature of the hazardous waste and identifies its origin, shipping route, and final destination. The waste must be pack- aged in appropriate and properly labeled containers. Generators must give transporters of hazardous waste a copy of the manifest. Transporters, such as trucking companies, must sign the manifest and, upon delivery, provide a copy to the owner of the TSD site, who must return a copy of the manifest to the generator, thereby closing the circle. If a generator is not informed of the proper disposal of the waste, it notifies the EPA. This reporting system provides regulators with the ability to track hazardous waste through its generation, transportation, and disposal phases. It also helps prevent disposal at unlicensed facilities.

Regulation of TSD sites

RCRA requires the EPA to regulate TSD sites. Certain hazardous wastes must be treated prior to disposal. A treatment facility is where a change is made in the physical, chemical, or biological character of hazardous waste to make it less hazardous or to recover energy or materials from it. A storage facility is where waste is held, such as in storage tanks, until it can be disposed of or treated. A disposal facility is where hazardous wastes are placed into controlled landfills.

Adjudicatory Power

Resolve disputes and violations through a judicial type of proceeding

1933 Act- what is the act designed for- when you make a new issue of stock you have to tell the investing public about it and file a registration statement

Section 11 of the 1933 Act imposes civil liability for misstatements. These include misleading statements and material omissions in securities registration material. Any person who buys a security covered by a registration statement that contains false or misleading information that would reasonably affect an investment decision, or that omits information that was important to a decision to purchase, may sue to recover losses incurred in that purchase.

494 - price state oil vs. khan - vertical price fixing at the top instead of the bottom (max price) Sell the price at this much but no higher than this- that is okay

Some years ago, the Supreme Court held that some price fixing in vertical relationships is acceptable. In State Oil Co. v. Khan (118 S.Ct. 275), a gasoline distributor controlled the maximum gasoline sales markup that its gasoline station dealers could charge customers. One gas station owner wanted to charge more for retail gasoline than the distributor would allow and sued, claiming this was illegal price fixing. The Supreme Court upheld the maximum-price controls, noting that low prices benefit consumers regardless of how the prices are set. A rule of reason is applied in such cases.

Example of non attainment area requirements

Suppose Geely wants to build a new car assembly plant in Detroit, a nonattainment area for sulfur dioxide. Geely must obtain a preconstruction permit from the EPA. To obtain the permit, Geely will have to apply LAER technology and prove that other plants Geely owns in the area are in compliance with Michigan's SIP. For example, if Geely's new plant adds 10 units of pollution to the air, Geely must reduce pollution elsewhere in the area by more than 10 units. That may require Geely to buy existing pollution sources and shut them down. When the new plant begins operation, air quality in the area should improve.

Toxic Substances Control Act

Tens of thousands of chemicals are registered with EPA. Under the Toxic Substances Control Act (TSCA) passed in 1976, the EPA keeps track of these chemicals. Because some chemicals can cause health hazards, accurate information about their possible impact is vital. When a producer wants to sell a new chemical, it must notify the EPA. This premanufacture notice, or PMN, must be submitted at least 90 days prior to the manufacture or import of the chemical." Under TSCA, there is a presumption of innocence; EPA must show that a chemical poses a health hazard before restricting or banning it. About 200 chemicals have been fully tested by EPA for safety, and five have been banned.

State implementation plan reviewed by the EPA

That review may occur at a regional office; there are ten EPA regional offices and branches of the regional offices in other cities. If a state does not submit an adequate plan, the EPA writes one for it. All SIPs must include the following: • Enforceable emission limits • Schedules and timetables for compliance • Measures for monitoring air quality and emissions from pollution sources • Adequate funding, personnel, and authority for implementing and enforcing the SIP

Liability for Mistakes

The Act makes financial institutions liable to consumers for damages caused by failure to make electronic transfers. However, liability is limited to actual damages proved, such as costs incurred by a consumer if a car is repossessed for failure to make a required payment. Consumers are to receive a monthly statement from financial institutions. Consumers have 60 days to report errors. When a consumer reports an error, the institution must resolve the dispute within 45 days. If an investigation takes more than 10 business days to complete, the institution must re-credit the disputed amount to the consumer's account; the consumer has use of the funds until the complaint is resolved. Failure to undertake a good-faith investigation of an alleged error makes the institution liable for triple the consumer's actual damages.

440 - 1933 Act - basis for security fraud - if you have any misstatements can you have liability - yes You file a registration statement and you are liable for misstatements

The Act requires that investors be given material information about new securities, and it prevents misrepresentation in the sale of securities. -Sometimes called the truth-in-securities law, requires that, before a security is sold, sellers disclose to prospective investors all material information about the security, its issuers, and the intended use of the funds to be raised. Material information is all relevant information that an investor would want to know about a company—its background, its executives, and its plan of operation. Filing a registration statement with the SEC fulfills disclosure requirements. -Aimed at reducing investment scams that offer impossibly high returns and tempt investors to "beat the market." Latta case

512 - Clean water act question Focus on dumping things into the water- can you do it? Yes you have to get a permit to do it!

The CWA makes it unlawful for any person, business, or government to dump pollutants into navigable waters without a permit. Although the Act does not define "navigable waters," the term is broadly interpreted for regulatory purposes. Except for isolated small bodies of water, all waters are considered to be under federal jurisdiction. National Pollution Discharge Elimination System (NPDES) permits are required not only for dumping waste water into water, but even for moving water from one place to another.

Exceptions of Anti Trust Laws

The Clayton Act exempts some activities of nonprofit organizations and of agricul- tural, fishing, and some other cooperatives.

483- Exemptions from anti-trust law - list of 6 or so activities that are exempt You pick the one that is not in this list for the question so memorize the list

The Clayton Act exempts some activities of nonprofit organizations and of agricul- tural, fishing, and some other cooperatives. • The Export Trading Company Act allows sellers of exports to receive limited antitrust immunity. For example, a group of domestic producers may be allowed to join together to improve their ability to sell their products in other countries. • The Parker doctrine, or state action doctrine, allows state governments to restrict competition in industries such as public utilities (e.g., cable television), professional services (e.g., nursing), and public transportation (e.g., taxicabs). However, the Supreme Court held that for the doctrine to protect parties from antitrust actions, the state must play "a substantial role in determining the specifics of the economic policy." That is, the state must have intended to restrict competition and perhaps fix prices. • The McCarran-Ferguson Act exempts the insurance industry from federal antitrust laws so long as the states regulate insurance. • Under the Noerr-Pennington doctrine, lobbying to influence a legislature is not illegal. This is because the First Amendment gives persons the right to petition their government, even if the purpose is anticompetitive. • Most labor unions' activities are exempt. The National Labor Relations Act protects collective bargaining to set conditions of employment.

Clean Air Act

The Clean Air Act sets rules for the construction of new industrial plants or for major renovations of existing facilities. The standards imposed on plant owners depend on the air quality of the area in which a plant is built. One set of rules applies if the plant is built in a "clean air area," and another set applies if a plant is built in a "dirty air area." In either case, the plant owner is required to obtain a pre construction permit from the EPA or the state agency that enforces the Act. The Clean Air Act of 1970, with major amendments in 1977 and 1990, establishes federal authority to control air pollution. Although prior to 1970 many states had passed air pollution regulations, the Nixon Administration and Congress wanted to do more. In the words of the Supreme Court, Congress intended to "take a stick to the states" with this law. The Act requires the EPA to set pollution standards and, through forced cooperation of the states, to enforce standards across the country.

516- Wetlands question- not always underwater but they are a lot, they are important to the environment. You have to get a permit to do something on this land

The EPA defines wetlands as: Those areas that are inundated or saturated by surface or groundwater at a frequency and duration sufficient to support, and that under normal circumstances do support, a prevalence of vegetation typically adapted for life in saturated soil conditions. Wetlands generally include swamps, marshes, bogs, and similar areas. Wetlands can be small holes or large areas and may contain one plant or dozens of important species. Under the CWA, anyone wanting to change a wetland must receive a Section 404 permit from the Army Corps of Engineers. The EPA may block an Army Corps permit to prevent environmental damage. About 10,000 permits are issued each year to allow dredging or filling of wetlands. Often, a permit to dredge wetlands includes a requirement that other land be restored to wetland status in exchange. Tens of thousands of more permits are issued each year for activities that "cause only minimal adverse environmental effects" to wetlands. Hence, businesses in construction or other activities that disturb earth must make sure wetlands requirements have been met. Permits have become standard practice, even for ordinary building projects.

Equal Credit Opportunity Act

The Equal Credit Opportunity Act (ECOA) was added to the CCPA to prohibit credit discrimination on the basis of race, sex, color, religion, national origin, marital status, receipt of public benefits, the good-faith exercise of the applicant's rights under any part of the CCPA, or age

Fear and accurate credit transaction act - 472 , 473 ? About basic idea behind the law what are the main points

The Fair and Accurate Credit Transaction Act (FACT Act) amended the Fair Credit Reporting Act. It requires the major credit reporting services (Experian, TransUnion, and Equifax) to allow consumers to see their credit reports annually for free. That allows consumers to correct inaccurate information in the report as well as to think of ways to improve their credit score. The primary concern of the FACT Act was to help deal with identity theft, which affects millions of people annually. The Act has numerous requirements, such as a rule that credit and debit card receipts may not include more than the last five digits of the card number, nor may the card's expiration date be printed on the cardholders receipt. In addition, the Disposal Rule protects against unauthorized access to consumer information by prohibiting improper disposal of receipts, which would make it easier for "dumpster divers" to retrieve information from the trash to steal identities. The FTC also coordinates with other financial regulators to have consistent rules about information disposal and protection. Lastly, there are rules that govern the disposal of information stored electronically. Because hard drives are difficult to securely and totally erase, their disposal must be given particular care.

460- Federal trade commission - what do they do Getting consent degree

The Federal Trade Commission (FTC) was established in 1915 to help enforce the anti- trust laws but the FTC also devotes resources to its Bureau of Consumer Protection, which handles matters such as deceptive business advertising and marketing practices. Some responsibilities are specifically ordered by Congress, such as the consumer credit statutes. But most consumer protection efforts evolve as the FTC decides what Congress meant when it amended the FTC Act in the 1930s and said, in Section 5, that "unfair and deceptive acts or practices in or affecting commerce are hereby declared unlawful." Based on experience and in response to pressure from Congress, the FTC investigates practices said to be unfair and deceptive. The FTC staff proposes complaints to the five commissioners, who decide by majority vote whether to issue a complaint. The com- plaint begins legal proceedings against a business engaged in practices the commission wants ended or modified. Congress ordered the FTC to fight "unfair and deceptive acts or practices." The lack of a clear definition for those terms means the FTC has leeway in deciding what cases to bring—what advertising is deceptive and what sales practices are unfair. The key term has always been "deceptive." Essentially, things held to be deceptive are also unfair, a term defined below.

National Ambient Air Quality Standards (NAAQS)

The NAAQS set limits on how much of a pollutant is allowed in the air outside—ambient air—as air quality is measured at hundreds of sites around the country.

Hint: when you file a registration statement with SEC, the SEC does not give a recommendation or an opinion about your investment

The SEC does not rule on the merits of an offering; that is, it does not give an opinion about the likelihood of success of a proposed business. But it can require issuers to make high risk factors clear in the prospectus so as to put buyers on notice. The registration becomes effective 20 days after it is filed. However, if the SEC issues a deficiency letter, the issuer needs extra time to amend the filing to provide more detail in the registration materials. The SEC can also issue a stop order to prohibit the sale of securities until the registration statement is amended to satisfy the examiners, but this is not common.

Sherman Act

The Sherman Antitrust Act was passed by Congress in 1890 in response to the unpopularity of large business organizations. "Every person who shall monopolize, or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of the trade or commerce among the several States, or with foreign nations, shall be deemed guilty of a felony." Violations of the sherman act carry the most severe penalties of the antitrust statutes. Most of the criminal cases involve price fixing or big rigging by competitors. Individual violators can face up to 10 years in prison, a fine of 1 million, or both. Business violators can be fined up to 100 million. Private parties or the government can seek injunction relief. injunctions order the defendant to stop the illegal acts. Private parties harmed by a violation of the sherman act can sue for treble damages, if they win, they get three times their actual money damages plus court costs and attorney fees.

Hazardous waste permits

The characteristics of a hazardous waste are ignitability, such as in gasoline; corrosivity, such as in acids; reactivity, such as in unstable chemicals; and toxicity, such as is found in materials that threaten groundwater. Wastes that threaten groundwater, such as used batteries and unused pesticides, may be stored or disposed of only at sites whose owners or operators have EPA permits. To get permits, the owners of treatment, storage, and disposal (TSD) sites agree to meet all regulations regarding the handling of hazardous wastes.

Per Se example

The classic example of a per se violation of antitrust law is a group of competitors agreeing on the prices to charge for their goods so they can eliminate price competition.

Sources of administrative law Enabling statues, rules agencies adopt, (memorize the list)

The enabling statutes of administrative agencies The Administrative Procedures Act (APA) Rules issued by administrative agencies Court decisions reviewing the validity of agency actions

Howie Test

The first element, "the investment of money," means an investor turns over money to someone else for an investment. The second element, "in a common enterprise," means that the investment is not the property of an investor, such as a car would be. Rather, an investor's capital is pooled with other investors' money so that each investor owns an undivided interest in the investment.

Point Source Pollution

The water pollution that is easiest to identify comes out of a pipe. We can see it, measure it, and, given technical knowledge, treat the discharge. Control of such point source pollution has been the primary focus of federal law since 1972.

Exhaustion

This is a "gatekeeping" device. The exhaustion doctrine requires a party to complete all agency appeals procedures before turning to a court for review. That is, parties may not go to the courts until they have exhausted all agency review procedures regarding a new rule or a disciplinary action. An action must be considered final by an agency before proceeding to court. This prevents unnecessary lawsuits by giving the agency the full chance to get the decision right.

Collection Practices Act Businesses that are collecting debts - Lists certain things you cannot do, no late calls - what you can do and one you cannot do no the question

To collect accounts, debt collectors advise consumers by telephone or letter of the outstanding debt and urge them to pay. Sometimes, consumers are subjected to phone calls in the middle of the night, obscene language, and other harassment and abusive tactics. The Fair Debt Collection Practices Act (FDCPA) helps reduce unfair, deceptive, and abusive collection techniques used by some debt collectors. Harassing, deceptive, and unfair debt collection practices—including: threats of violence or arrest, obscene language, the publication of a list of delinquent consumers, and harassing phone calls—are prohibited. Debt collectors may not discuss the debts with other people, including the debtor's employer. The Act prohibits the use of false or misleading representations in collecting a debt. What you can say: The FDCPA requires the debt collector to send cer- tain information to the consumer within five days of the initial communication: • Amount of debt • Name of the creditor to whom the debt is owed • A statement that unless the consumer disputes the validity of the debt within 30 days, the debt collector will assume the debt is valid • A statement that the debt collector must show proof of the debt if the consumer advises the debt collector within 30 days of the notification that the consumer disputes the debt

437- Securities-Regulation D

To explain what qualifies as a private placement exemption, the SEC adopted Regulation D. Such offerings may be made only to accredited investors. These investors are presumed to be sophisticated and wealthy enough to evaluate investment opportunities without an SEC-approved prospectus. Only accredited investors may participate in private placement offerings of securities. Institutions, such as banks and insurance companies, are accredited investors. Individual investors must have an annual income of at least $200,000 ($300,000 for a couple) or a net worth of at least $1 million. All other investors are unaccredited. The most common form of regulation D is Small Corporate Offering Registration. Companies may issue stock directly to accredited investors, and according to Rule 504, a company may raise up to $1 million within 12 month. This can be done on the Internet, as can larger offers that fall under Rule 505 ($1 to $5 million) or Rule 506 (over $5 million). Most states similarly allow such offerings without going through the registration process. However, the SEC must be notified of the fact that the sale is occurring by filing Form D.

Deception policy statement

To give the FTC staff guidance, the commissioners adopted a deception policy statement that summarizes a three-part test for deciding whether a particular act or practice is deceptive. There is deception if the following are true: 1. There is a misrepresentation or omission of information in a communication to consumers. 2. The deception is likely to mislead a reasonable consumer. 3. The deception is material; that is, it is likely to be misleading to the detriment of consumers.

Vertical Price Fixing

Vertical price-fixing arrangements involve agreements between a manufacturer, its wholesalers, its distributors or other suppliers, and the retailers that sell the product to consumers. As a rule, these are intended to control the price at which the product is sold to consumers. Agreements can call for the retailer to fix minimum prices or maximum prices.

What is the EPA responsible for- one of the answers they are not responsible for

Water, air, land they are responsible for

State Implementation Plan

When EPA sets limits for the NAAQS, each state develops a State Implementation Plan (SIP). The SIPs define the controls to be used in each state to achieve the standards. The Act requires that regulated emission sources meet pollution control requirements as set by the SIP by a certain date. SIPs are usually tens of thousands of pages long, specifying what each factory and production process can emit, so they are of immense concern to many firms.

Price fixing is illegal - question 5 guys, whataburger, wendys they are all horizontal- sell burgers at same price

When businesses at the same level of operation, such as retailers of a common product or producers of a raw material, come together in some manner—through contract, merger, or conspiracy—they risk being accused of restraining trade. A horizontal restraint of trade occurs when the businesses involved operate at the same level of the market and generally in the same market.

Price Fixing

When firms sell the same product and agree to fix the price, there is a conspiracy that likely violates the Sherman Act. Price fixing has usually been held to be the worst violation of the antitrust laws. In U.S. v. Trenton Potteries (276 U.S. 392), the Supreme Court held that when competitors fix prices, there is a violation of the Sherman Act, whether the prices they set are reasonable or not. The Court decision held that agreements to set prices "may well be held to be in themselves unreasonable or unlawful restraints, without the necessity of minute inquiry whether a particular price is reasonable or unreasonable." That is, most price fixing is illegal per se. Freeman case.

Informal Actions

When the agency is trying to enforce the law- do they always have to take the hard line (miner and fire story) Because informal procedures generally require less time and money than formal procedures, agencies prefer to use them when possible. Informal procedures include tests and inspections, processing applications and permits, negotiations, settlements, and advice in the form of advisory opinions. Publicity, or the threat of it, can also be considered an informal procedure for an agency to get industry to comply with its rules. In some instances, agencies may act on the spot. For example, an OSHA inspector, upon finding a situation that endangers workers, may order immediate changes. Many such incidents are handled this way, rather than involving time-consuming, more costly formal procedures. Perhaps the Black Beauty case would not have evolved into a formal matter if managers had responded to the inspector's conclusions about a problem on the spot. Similarly, manufacturers "voluntarily" withdraw products from the shelves and destroy them when a problem is discovered that would likely result in formal action by an agency.

FDA- food - criticisms small % of drugs get through , lots of deaths Speeding up the process 460

While enforcement has become tougher, the FDA has been allowing quicker approval for drugs that show some promise in life-threatening diseases such as AIDS. Rather than require the full, lengthy review process before the drugs may be sold to informed patients, the FDA allows the drugs to be carefully distributed.

496 Tie-in arrangements : you say to your buyer I have this product but you have to buy this product too to buy this 1st product. It may be illegal if that person has a monopoly in the tie in product then that is a violation of anti trust law 498

an agreement by a party to sell one product [the tying product] but only on the condition that the buyer also purchases a different [complementary or tied] product, or at least agrees that he will not purchase that product from any other supplier. The Supreme Court held that where monopoly power exists, tying arrangements violate the antitrust laws; the arrangement extends a firm's market power over the tying product into the market for the tied product. The courts apply either Section 1 of the Sherman Act—viewing tying arrangements as an unreasonable restraint of trade—or Section 3 of the Clayton Act—viewing tying arrangements as a sales contract that may substantially lessen competition or tend to create a monopoly.

The FTC's Disposal Rule

applies to all businesses and persons that use consumer reports. It states that the information received in such reports must be properly destroyed after it has been used for its proper purpose.

509 - Clean air act -

dirty areas You have to go through much more than you would in a clean air area because you are already below the standard

issue barter - 446

elevator in NYC and overhears gossip that he could use for a profit. YES that is okay to make a profit on !!

Insider trading questions - working for a company or associated with benefits You can be in trouble and you don't make the trading but you give a tip to someone

insider trading—the buying or selling of stock by persons who have access to information affecting the value of the stock that has not yet been revealed to the public. As the Supreme Court has noted, misappropriation of private information gives insiders an unfair advantage in the market over investors who do not have the information. It is illegal for an insider to trade on inside information until that information has been released to the public, and the stock price has had time to adjust to the new information. the person making the purchase or sale was aware of the material, nonpublic information when the person made the purchase or sale. Executives in a firm, who almost always are aware of such information, may trade stock in their company and not be liable for insider trading if they contracted at an earlier date to have another person buy or sell the security at a specific time or on a "program" basis; that is, to make trades at specific time intervals. The SEC may prosecute insiders if they trade in the stock before the public has a chance to act on the information or they pass the information on to others so they can act. suppose an attorney working for General Electric found out that GE was about to announce the sale of $1 billion worth of jet engines to Boeing in two days. Knowing that this good news would make GE stock rise, the attorney buys some GE stock before the announcement. This is insider trading for which the attorney could be sued for all profits earned from the stock transaction as well as incur other penalties. x

The Brownfields Revitalization Act of 2002

passed to help bring such brownfields back into use. It limits the liability to purchasers of contaminated sites for previous improper dumping of toxic wastes on the land.

Duty-free ports

ports of entry that do not assess duties or tariffs on products. They encourage the importation and sale of international goods within the country. Hong Kong is well known for such practices. Benefits to a country are the encouragement of trade with other countries and the attraction of businesses and tourists to the country to purchase products free of duties and other fees.

Truth and lending act - applies to lenders of standing credit 468?

requires creditors in consumer transactions to disclose basic information about the cost and terms of credit to the consumer-borrower. By standardizing credit terms and methods of calculation, it helps people to shop for the most favorable credit terms.

468- Another truth and lending question & 469 Applies to extension of credit only to businesses in that business

requires creditors in consumer transactions to disclose basic information about the cost and terns of credit to the consumer borrower

Many electronic fund transfer (EFT) services are available to consumers. Such transfers are larger in volume than are the funds transferred by check and cash. They include:

• ATM deposits or other transactions • Direct deposits of paychecks • Debit cards used to buy goods or services • Automatic bill-paying services • Telephone transfers to credit cards (presuming a written agreement exists)