Quiz 2 (Law)
what is prima facie
"from its first appearance", something that appears to be true upon a first look
what is the federal minimum wage
$7.25 per hour plus time and a half for any hours over 40 in a week -doesnt apply to salaried workers
describe Massachusetts' preference for non-competes
-1 year restriction -maybe up to 2 years if its for a high level employee w/ access to trade secrets, customer lists, and other proprietary information
describe the state restrictions of non-competes
-1/3 of the states have restrictions on them -california prohibits them unless they are tied to the sale of business or a verifiable trade secret
what type of contracts must be in writing
-Agreements for an Interest in Land. Examples: a mortgage or rental lease. -Agreements that cannot be performed within One Year. (building contracts) -Agreements to pay the Debt of Another. -Agreements Made in Consideration of Marriage. -Agreements for the sale of goods of $500 or more
what documents does section 13 require companies to file
-An initial, detailed information statement when the company first registers: S-1 -Annual reports on Form 10-K -Quarterly reports on Form 10-Q, which are less detailed than 10-Ks -Form 8-K to report any significant developments
what is the rightful owner entitled to if they win the infringement suit
-An injunction prohibiting further violations -Destruction of the infringing material -Up to three times actual damages -Any profits the infringer earned on the product -Attorney's fees
who counts as an officer
-CEO -president -CFO -treasurer -VP -secretary -chairperson
who is an insider
-Corporate insider includes officers, directors and anyone else who works for the company. This includes employees and constructive insiders, such as lawyers and auditors who have an indirect employment relationship. -fiduciary's spouse, child, parent, and sibling also have a duty not to trade -Anyone who has a fiduciary duty to the company
what is contained in the prospectus
-Description of company's business, properties and competition -Description of risks of investing -Discussion and analysis of financial condition -Identity of officers and directors and compensation -Description of material transactions involving officers, directors and shareholders -Description of material legal proceedings -Description of plan and use of the proceeds of the offering
describe shareholder meetings
-Every shareholder who owns stock on the record date must be sent notice of the annual or special meeting. -There must be a quorum for any vote to count. -Shareholder meetings can happen online. -Shareholders can appoint proxies-someone to vote for them in their absence. -Companies must provide shareholders with a proxy statement and annual report-10-K
what are the facts, issue, decision of Gulino v. Bd. of Educ. of the City Sch. DIs. of NY
-Facts: All teachers had to take a test (LAST) to demonstrate their understanding of liberal arts & sciences. Teachers couldn't be licensed to teach in NY unless they passed this test. NAS tried to make the test neutral. Whites passed the test at a higher rate than blacks and latinos -Issue: Did the LAST violate Title VII? -Decision: It did. LAST is not job related
what are the facts, issue, decision with Azte v. Auto collection, inc
-Facts: Auto collection Inc. operated a used car dealership that sold luxury cars to buyers in eastern Europe. Steven Lever owned 90% of Auto, his wife & son (Joshua) both owned 5% Address listed on Auto's bank account was Steven's personal address, not Auto's place of business. Steven initially capitalized Auto with a few thousand dollars but afterwards was not sure of the exact amount because he contributed funds as needed. Steven claimed to have loaned $900,000 to Auto but there was no documentation. He deposited & withdrew money from Auto's bank account at his sole discretion. When Joshua became Auto's employee he was paid $474,850 during his year at the dealership even though Auto stopped delivering cares that its customers paid for Claiming they were owed more than $500,000 the plaintiffs filed suit against Auto, Steven, and Joshua -Issue: Should the court pierce Auto's corporate veil? Are Steven and Joshua liable for Auto's debts? -Decision: Steven openly admitted that he owned Auto & treated its assets & resources as his own. This practice is the essence of commingling, self-dealing & disregard of the corporate form. Steven ignored a number of corporate formalities. Son's huge salary but Auto didn't have enough money, inadequate capitalization. Justified piercing the corporate veil on Steven but not Joshua
describe Baer v. Chase
-Facts: Baer sued Chase who was the producer of the Sopranos. Chase wanted to interview Baer to get content for the show. Chase never gave a definite offer to Baer for his intel. Chase created his show but never paid Baer Issue: Did Baer and Chase create a contract? Decision: Chase won since there was no valid offer
what are the facts, issue, decision of Anderson v. Bellino
-Facts: Bellino & Anderson formed a restaurant, lounge, and keno game in LaVista Nevada. Both owned 50% of the stock of Lottery & were both officers & directors. Bellino spent more time, in part because of his personal relationship with the lounge manager. Bellino didn't complain to Anderson about his lack of involvement in Lottery & Anderson never refused to do anything that Bellino asked him to do. Bellino incorporated LaVista Keno, Inc to bid on the contract while still being director of Lottery. Anderson also bid on the contract on behalf of Lottery. To gain rights to Keno. City awarded the new contract to Keno. Anderson & Lottery filed suit against Bellino & Keno alleging that they had taken a corporate opportunity -Issue: Did Bellino take a corporate opportunity? Is he liable to Lottery? -Decision: Bellino did nothing to impede Lottery from bidding for the Keno contract by just submitting a competing bid, therefore Bellino didn't usurp a corporate opportunity. Bellino's successful bid for the LaVista keno contract deprived Lottery of its only source of business, which breached Bellino's fiduciary duty/trust to Lottery Upheld Anderson's case
what are the facts, issue, decision of Hispanics United of Buffalo Inc. and Carlos Ortiz before the NLRB
-Facts: Cruz-Moore constantly complained to Cole-Rivera that other employees provided poor service to their clients. Cruz-Moore texted Cole-Rivera that she intended to tell the executive director, Lourdes Iglesias that other employees haven been underperforming. Cole-Rivera posed a message on her Facebook about all the complaints Cruz-Moore has been saying and 4 off-duty employees commented upset with Cruz-Moore. Cruz-Moore complained to Iglesias that she felt defamed by the Facebook postings. Iglesias fired Cole-Rivera and the 4 other coworkers who commented on the ground that their remarks violated the Agency's zero tolerance policy on bullying & harassment -Issue: Were these Facebook postings protected speech under the NLRA -Decision: Since five employees engaged in the Facebook comments, the act was concerted so its protected. Facebook comments fall within the NLRA's protection. Facebook comments weren't a form of harassment within the meaning of the Agency's policy. Agency applied its harassment policy to the discharged employees based solely on Cruz-Moore's subjective claim that she felt offended by the comments
what are the facts, issue, decision of Raul v. Rynd
-Facts: In the face of poor performance, the board of directors unanimously approved a compensation plan that raised executive pay by 40%-190% Company presented the compensation plan to shareholders at the annual meeting. 59% of the shareholders voted against the plan but the board continued with it anyways. Raul brought suit, alleging that the board had breached its fiduciary duty by approving the compensation plan in the face of a negative shareholder vote -Issue: Did the Hercules board violate its fiduciary duty when it approved the compensation plan? -Decision: Goal of retaining an executive could lead to increased executive compensation even if the company is experiencing poor financial performance. Hercules motion to dismiss is granted
what are the facts, issue, decision of Teresa Harris v. Forklift Systems inc.
-Facts: Teresa Harris was a manager at Forklift systems, the president Charles Hardy, constantly make sexual comments to Harris and other women at the company. Harris sued Forklift, claiming that Hardy created an abusive work environment -Issue: To be a violation of Title VII, must sexual harassment seriously affect the employee's psychological well-being? -Decision: Lost the case in state court but won it in appeal court. A discriminatorily abusive work environment, even one that doesn't severely affect employee's psychological well-being can & often will detract from employee's job performance, discourage employees from remaining on the job, or keep them from advancing in their careers
what are the facts, issue, decision of Peterson v. Exide Technologies
-Facts:Exide Technologies issued multiple warnings to Peterson for driving forklifts too fast & violating other safety rules. Peterson was injured in a forklift crash. Exide granted him FMLA leave for 10 days. Peterson's manager fired him during the leave period for "flagrant violations of safety rules". Peterson sued claiming he was fired in retaliation for exercising his right to take FMLA leave -Issue: Was Peterson fired in retaliation for claiming FMLA leave? -Decision: Exide argued that it fired Peterson for the actual reason that he violated the company's safety policies. Manager based his decision on the Peterson's history of careless & unsafe conduct. Peterson didn't produce any evidence to undermine Exide's legit reason for firing him. Granted summary judgment because there was no evidence that suggests a connection between Peterson's firing and his exercise of FMLA rights
what are the facts, issue, decision of Hamer v. Sidway
-Facts:William Story promise his 15 year old nephew that if he didn't drink, smoke, swear, play cards or billiards for money until his 21st birthday he would get $5,000 Nephew agreed and kept his word By his 21st birthday, the nephew notified his uncle about the agreement but the uncle wanted to wait a little longer until the nephew was mature enough to handle the large amount of money The uncle died without having paid & his estate refused to honor the promise. Because the nephew has transferred his rights to the money to Hamer & Hamer eventually sought to collect from the uncle's estate. Estate argued that the nephew has given no consideration for the uncle's promise, there was no enforceable contract -Issue: Did the nephew give consideration for the uncle's promise? -Decision: It is enough that something is promised done, forborne, or suffered by the party to whom the promise is made as consideration for the promise made to him
under the 1934 act, an issuer must register with the SEC if:
-It completes a public offering under the 1933 Act -Its securities are traded on a national exchange like the NYSE and NASDAQ. -The 1934 Act also mandates periodic disclosures.
who is carmen segarra
-Super reputable on Wall Street. -Hired by Federal Reserve bank to be an examiner. She was the examiner for Goldman Sachs to see if they were meeting the regulations of the Fed. Every company must have a clear ethics policy. -Segarra noticed that Goldman lacked and ethics policy and told them to get one. Goldman continued to not comply & the Fed kept giving a pass to Goldman because of their reputation. Segarra begins to tape recording her meetings with her boss & keeps insisting Goldman's ethics policy. -She was fired later on for insubordination. Segarra sues for discrimination & retaliation. Loses her case. Judge doing the case was the wife of a Goldman executive.
what does section 13 require CEO & CFO to certify that:
-The information in the quarterly and annual reports are true -The company has effective internal controls; and -The officers have informed the company's audit committee and external auditors about concerns of internal controls.
what are the three main parts of a patent application
-Title, Inventor's name, filing date, issue date, and some reference numbers for prior art, which describes the prior invention. -Specification: abstract, background and several drawings. -Claims: numbered paragraphs that gives the public the exact scope of the patent.
for publicly traded companies independent directors must comprise:
-a majority of the board -entire audit committee -entire compensation, corporate governance, and nominating committees
who are shareholder activists
-a new development in corporate democracy -they advise institutional investors on how to vote their shares
what is a charter & what does it define
-aka Article of Incorporation or Article of Organization defines the corporation -name of the corporation -address & registered agent -incorporator -directors & officers -purpose -stock
when can a corporation not have a board of directors
-all shareholders agree to not have a board -corporation has 50 or less shareholders
what counts as a serious health condition in the FMLA
-any health issue that requires hospitalization -condition that requires more than one visit to a healthcare provider -condition that requires only one visit to a healthcare provider but also requires a course of treatment such as physical therapy
what are derivative lawsuits
-brought by shareholders to remedy a wrong that the board of directors has committed again the corporation
describe the organizing stages of a union
-campaign -authorization cards: if organizers get enough cards, they seek recognition as the official representative for the bargaining unit. they need 30% cards signed -petition: petition the NLRB for an election -election: if more than 50% of workers vote in favor, NLRB designates union as the exclusive representative
who does FMLA apply to
-companies that have 50 or more workers -employees who have been with the company full time for atleast a year
when do duty of loyalty issues arise
-conflict of interest -misappropriation of corporate opportunity -competition with the corporation -misappropriation of corporate assets -egregious conduct
what are partial strikes
-employees stop working temporarily, then resume, then stop -union can either walk off the job or stay on it, but it cannot alternate -prohibited
describe the Affordable Care Act
-employers with 50 or more full-time employees must pay a penalty if they don't provide basic health insurance -all individuals must have health insurance or face a penalty (individual mandate) -individuals who don't have access to insurance can buy it through a health insurance exchange -expands coverage of Medicaid to all americans under 65 who have incomes below the poverty line
when is it ok to copy
-fair use doctrine: Permits limited use of copyrighted material without permission of the author for purposes such as criticism, comment, news reporting, scholarship, or research. -first sale: A person who owns a lawfully made copy of a copyrighted work may sell or otherwise dispose of the copy. -parody: A fair use of copyrighted material so long as the use of original is not excessive.
what are the five categories of distinctive marks
-fanciful -arbitrary -suggestive -secondary meaning -trade dress
how does a manager or controlling shareholder avoid liability in corporate opportunity doctrine
-first offer an opportunity to disinterest directors & shareholders, only if they turn it down, take an advantage of the opportunity themselves -show that the company would have been unable to benefit from the opportunity
what securities are exempt from the 1933 act
-gov't securities -bank securities -short-term notes (9 months & not sold to the public) -non-profit issues (religious, charitable organizations) -insurance policies & annuity contracts (governed by insurance law)
when can a union call a strike
-if parties are unable to reach a CBA -to protest a ULP or to preserve work that the employer is considering sending elsewhere
what is not an offer
-invitations to bargain -letters of intent -advertisements
does someone have to register their trademark with the gov't
-its not necessary -PTO will accept trademark application as long as owner has used the mark in interstate commerce or promises to use it within 6 months after filing -Trademark is initially valid for 10 years and can be renewed for additional 10 year terms
why do many companies incorporate in Delaware
-laws favor management -efficient court system -established body of law -neutral ground
what are some things to consider when deciding business forms
-liability -taxes -ease of formation/maintenance -ability to raise capital -impact on society
describe the liability under the 1933 act
-liability on anyone who sells a security that is neither registered or exempt -liable for making any material misstatement or omission in connection with the offer or sale of a security -if a final registration statement contains a material misstatement or omission, the purchaser of the security can recover from everyone who signed the registration statement
what does the Copyright Act protect
-literature -music -drama -choreography -pictures -sculptures -movies -recordings -architectural works -computer programs/databases
what are the three sources that affirmative action programs have
-litigation: courts have the power under Title VII to order affirmative action -voluntary action: employers can voluntarily introduce an affirmative action plan -government contracts: gov't can use affirmative action programs when awarding contracts if it can show that the program is needed to overcome a specific past discrimination, they have time limits, and nondiscriminatory alternatives are not available
describe the purpose of statutory prohibition on strikes
-many states have outlawed strikes by public employees -ensure that unions don't use public health/welfare as a weapon to secure an unfair bargaining advantage
whats the difference between medicare and medicaid
-medicare is essentially social security to care for the elderly -medicaid is for the poor and disabled
what can a defendant say to defend their discrimination
-merit -poor work performance -legit business decision -seniority -bona fide occupation qualification (BFOQ)
describe the process of electing directors
-nominating committed of the board of directors produces a slate of directors with one name per opening. the names are approved by the CEO -the slate of directors is then presented to the shareholders to either vote in favor or to withhold their vote
what are the purposes of the registration statement
-notify the SEC that a sale of securities is pending -to disclose information to prospective purchasers
what are the requirements for a patent
-novel -nonobvious -useful -patentable subject matter
what are the elements of a contract
-offer: all contracts begin when a person/company proposes a deal -acceptance: once a party receives an offer, they must respond in a certain way -consideration: there has to be bargaining that leads to an exchange of value between the parties -legality: the contract must be for a lawful purpose -capacity: parties must be adults of sound mind -consent: certain kinds of trickery & force can prevent the formation of a contract -writing: some types of contracts must be in writing to be enforceable -breach: there are consequences when one party breaches a contract & usually the plaintiff will want monetary damages
what are the two factors that lead the court to find unconscionability
-oppression: one party used it superior power to force a contract on the weaker party -surprise: weaker party did not fully understand the consequences of its agreement
what does the National Labor Relations Act (NLRA) guarantee
-organize & join unions -bargain collectively through representatives of their own choosing -engage in other concerned activities
why are corporate executives paid so much
-other people's money -benchmarking -stock prices -rationalization -competitive market -nice work if you can get it -hard to see the harm
what are the three items of info does the charter need to give about stock
-par value -number of shares (authorized & unissued, or issued) -classes and series
what does the business judgement rule accomplish
-permits directors to do their job -keeps judges out of corporate management -encourages directors to serve
what is the false claims act
-permits lawsuits against anyone who defrauds the government -prohibits employers from firing workers who file suit under the statute
how does someone prove a violation of copyright infringement
-plaintiff must present evidence that the work was original and that either: -the infringer actually copied the work or -infringer had access to the original and the two works are substantially similar
what are the definite terms the offeror must have in their contract
-price -quantity -date -duration
what is patent prosecution
-process by with an inventor files an application with the US patent and trademark office in order to obtain a patent -it takes about 3-6 years for the PTO to issue a patent
what can the court do for copyright infringement
-prohibit theinfringerm from further violations -order destruction of the infringing material -require theinfringerm to pay damages, profits earned, and attorney's fees
what are the common features of a close corporation
-protection of minority shareholders -transfer restrictions -flexibility: can operate without a board of directors, bylaws, or annual shareholder meetings -dispute resolution: shareholders can agree in advance that anyone of them can dissolve the corporation for any reason -usually family owned & operated
what are the two categories of sexual harassment
-quid pro quo: if any aspect of a job is made contingent upon sexual activity, "one thing in return for another" -hostile work environment: any verbal/physical conduct of sexual nature that interferes with an employees ability to work
what are the shareholders rights
-right to information -right to vote -election and removal of directors
describe the process of electing officers & directors
-shareholders hold a meeting or elect directors by written consent -once directors are elected, they can elect/appoint the officers of the corporation by meeting/written consent
how does a derivative lawsuit get going
-shareholders must make a demand on the directions in order to file a derivative lawsuit -the only way to overcome this requirement is to show that the demand is futile because directors violated duty or care, duty of loyalty as required by business judgement rule
what categories cannot be trademarked
-similar to an existing mark -generic trademarks -descriptive marks -names -deceptive -scandalous or immoral
describe Title VII of the civil rights act
-states that its illegal for employers with 15 or more employees to discriminate on the basis of race, color, religion, sex, or national origin -employees are protected under every aspect of the employment process including hiring, firing, promoting, placement, wages, benefits, and working conditions
how does the plaintiff prove disparate treatment
-step 1: plaintiff presents evidence that they belong to a protected category: that they suffered adverse employment action, & that the action occurred under conditions giving rise to a inference of discrimination -step 2: employer must present evidence that its decision was based legit, nondiscriminatory reasons -step 3: to win, plaintiff must prove that the employer intentionally discriminated by showing that the reasons offered were false (pretext) or that the real reason was motivated by discriminatory intent/motive
what can workers do to organize for union
-talk among themselves about working conditions & forming a union -hand out literature -join a union
what are the limitations to Reg.
-the offering must be to accredited, sophisticated investors—institutions or wealthy individuals who can assess the risks of the offering -the securities must be purchased for investment purposes and cannot be sold for one year.
what is on the cover of a patent
-title -inventor's name -serial number -filing date -abstract -issue date
what are some types of marks
-trademarks: affixed to goods in interstate commerce -service marks: identifies services -certification marks: attest that products meet certain standards -collective marks: identify members of an organization
how can an organization become a socially conscious one
-two thirds of shareholders must approve -company must agree to measure its social benefit using a standard set by an objective third party -on its website, company must assess and report regularly on its societal & environmental impact
what is the process an issuer follows for an IPO or a secondary offering
-underwriting -registration statement -prospectus -sales effort -going effective
how long are copyrights valid
-until 70 years after the deal of the work's only or last living authors -for corporations it lasts 95 years from publication or 120 years from creation, whichever is shorter
what are the two basic elements of consideration
-value: both parties to a contract receive a legal benefit (measurable value) & incur legal detriment -bargained-for exchange: parties must have bargained for whatever was exchanged & struck a deal
what is the process of terminating a corporation
-vote: directors reccoment to the shareholders that the corporation be dissolved & a majority of shareholders agree -filing: the corporation can file "Articles of Dissolution" with the Secretary of State -winding up: the officers of the corporation pay its debts & distribute the remaining property to shareholders. when winding up ceases, so does the corporation
what must the employer and union discuss
-wages -hours -other terms & conditions of employment
when are exculpatory clauses generally not enforceable
-when the attempt to exclude conduct that is intently or grossly negligent -when the affected activity is in the public interest like medical care or public transportation -when the parties have unequal bargaining power -unless the clause is clearly written and readily visible
how must the inventor present the claims
-with sufficient scope to get ahead of the competition, yet just narrow enough to avoid prior art -must fully describe the inventor's conception to provide support for the broadest claim construction possible and to comply with statutory requirements -must present strong & enforceable claims that will withstand challenges
how long do design patents last
14 years from the date of issuance
how long do utility patents last
20 years from the date of filing
what is insider trading
A crime punishable by fines, imprisonment and disgorgement of profits.
describe the business judgement rule
A judicially created presumption that officers and directors make informed decisions in good faith and in the honest belief that their conduct was in the best interests of the company. If managers comply with the business judgment rule, a court will not hold them personally liable for any harm their decisions cause the company or rescind their decisions.
what is a trademark
Any combination of words and symbols that a business uses to distinguish products or services and distinguish them from others.
whats a security
Any transaction in which the buyer invests money in a common enterprise and expects to earn a profit predominately from the efforts of others
describe section 18
Anyone who makes a false or misleading statement in a filing under the 1934 Act is liable to buyers and sellers who: -Acted in reliance on the statement -Can prove that the price at which they bought or sold was affected by the false filing
what is the dodd-frank wall street reform & consumer protection act
Anyone who provides information to the government about violations of securities or commodities laws is entitled to a financial reward
who is a tipper
Anyone who reveals material nonpublic information in violation of his fiduciary duty is liable if he: -Knows the information is confidential -Expected some personal gain
what is the theory of misappropriation
Anyone with: 1. material, non-public information 2. who breaches a fiduciary duty to the source of that information 3. by revealing or trading on it, is also guilty of insider trading ex: lawyers, accountants, family members
what does a trademark owner show to win an infringement case
Defendant's trademark is likely to deceive customers about who made the product or provided the service
describe section 16
Prevents corporate insiders who own more than 10% of the company from taking unfair advantage of privileged information to manipulate the market: -Insiders must report their trades within 2 business days to the SEC and the company. -Insiders have to return any profits from a purchase and sale that is in a 6-month period.
describe section 10(b)
Prohibits fraud in connection with the purchase and sale of any security whether or not it is registered under the 1934 Act. It is a catch-all provision.
what is the securities act of 1933
Requires that before offering or selling securities, the issuer must register the securities with the SEC unless the securities qualify for an exemption
what does it mean to go effective
SEC authorizes a company to begin the public sale of its stock
how does the plaintiff prove disparate impact
Step 1 - Plaintiff must present a prima facie case that she is a member of a protected class and suffered an adverse employment practice. Step 2 - Defendant must offer some evidence that the employment practice was a job-related business necessity. Step 3 - To win, plaintiff must prove either that the Employer's reason is a pretext (false) or that other, less discriminatory rules would achieved the same results.
what is firm commitment underwriting
The underwriter (Investment Bank) buys stock from the issuer and sells it to the public.
what is best efforts underwriting
The underwriter does not buy the stock from the issuer but instead acts as the issuer's agent in selling the securities.
who is a tippee
Those who receive tips are liable for trading on inside information, even if they do not have a fiduciary relationship to the company, as long as: -They know the information is confidential -They know it came from an insider who was violating his fiduciary duty -The insider expected some personal gain
what is an issuer
a company that sells its own stock
what is piercing the company veil for LLCs
a court holds members of an LLC personally liable for the debts of the organization
whats a prospectus
a document that provides potential investors with information about a security
what is a limited liability company (LLC)
a form of an organization that offers the best of both worlds: limited liability of a corporation and the tax status of a partnership
what is self-dealing
a manager makes a decision benefiting either themselves or another company with which they have a relationship
what is a counteroffer
a party makes a counteroffer when it responds to an offer with a new and different proposal -this equates to terminating the original offer
what is a private offering
a sale of securities that involves a small number of investors or takes in a relatively modest amount of money
what is the equal pay act of 1963
a worker may not be paid at a lesser rate than employees of the opposite sex for equal work
what is an offer
an act/statement that proposes definite terms & permits another person to accept the terms and enter into an agreement
what is a noncompete agreement
an employee promises not to work for a competitor for some time after leaving their company
what is terminations by revocation
an offer is revoked when the offeror "takes it back" before the offeree accepts
what is a general partnership
an unincorporated association of two or more co-owners who operate a business for profit
what is a sole proprietorship
an unincorporated business owned by now person
describe rule 10b-5
any corporate insiders with material, nonpublic information, who breaches a fiduciary duty to his company by trading on the information is guilty of insider trading
what can a patent be obtained for
any new & useful, process, machine, manufacture, or composition of matter or any new and useful improvement thereof
what is a secondary offering
any public sale of securities by a company after the initial public offering
what is a stakeholder
anyone who is affected by the activities of a corporation
what is a road show
as part of the sales process, company executives & investment bankers make presentations to potential investors
when is a work copyrighted
automatically copyrighted once its in tangible form
what is the cooling-off period in strikes
before striking to terminate/modify a CBA, a union must give management 60 days' notice
who must be on the board of directors for social enterprise
benefits director -monitor -yearly benefits report
what are common types of securities
bonds and stocks
where are exculpatory clauses commonly used
businesses that involve some risk like skiing, sky dying, sports events, bailment cases
what are clickwraps and shrink-wraps
by clicking on the box, you have accepted the terms of the contract
what can employers do during the organization of a union
can present anti-union views to its employers -cannot use either threats or promises of benefits to defeat a union drive
what is the no-strike clause
clause in a CBA that prohibits the union from striking while the CBA is in force
what is perpetual existence
company can exist without their founders
what is an initial public offering (IPO)
company's first public sale of securities
what is a collective bargaining agreement (CBA)
contract between a union and a company ` -must bargain in good faith
what is an exculpatory clause
contract provision that attempts to release one party from liability in the event the other is injured
what does the name of a corporation need according the the law
corporation, incorporated, company, or limited after the name
what does it mean to pierce the corporate veil
court holds shareholders personally liable for a corporation under four circumstances -failure to observe formalities -commingling of assets -inadequate capitalization -fraud
what is a registration statement
document that an issuer files with the SEC to initiate a public offering of securities
what are bylaws
document that specifies the organizational rules of a corporation or other organization such as when shareholder meetings are held
what is a whistleblower
employees who disclose illegal behavior in the part of their employer
describe the use of bona fide occupational qualification
employer is permitted to establish discriminatory job requirements if they are essential to the position in question but never based on race or color
what is qualified privilege
employers who give references are not liable unless they know what they said is false or they are primarily motivated by ill will
what is the securities and exchange commission
federal agency that enforces securities laws
how is it decided who owns a trademark
first person to use a mark in trade owns it
what states have banned affirmative action
florida, california, michigan
why does the court refuse to enforce a unconscionable contract
fundamental fairness
what is a patent
gives an inventor the right to prevent others from making, using, selling their invention for limited time
what is a bailment
giving possession and control of personal property to another person ex: valet
what is the family medical leave act (FMLA)
guarantees both men & women up to 12 weeks of unpaid leave each year of childbirth, adoption or serious health condition of their own or immediate family member
describe the frank richie case
he was a white fire fighter who took a promotional test. he scored the highest on the test but wasn't given the promotion because the department wanted to diversify the fire fighters. Frank won the case on disparate treatment
what is termination by rejection
if an offer clearly indicates that they don't want to take the offer, then they have terminated the offer
what is termination by operation of law
if an offeror dies or becomes mentally incapacitated, the offer terminates automatically and immediately
when do employees get paid for overtime
if employees work all the time or even if they are on call, they are entitles to be paid for the hours
when is a non-compete enforceable
if its essential to the employer, fair to the employee, and harmless to the general public
when can a court pierce an LLC's veil
if members: -fail to observe formalities -commingle assets -fail to provide adequate capital -commit fraud
how does a plaintiff make prima facie case
if plaintiff presents evidence that: -belong in a protected category -suffered adverse employment action -action occurred under conditions giving rise to an inference of discrimination
whats disparate impact
if the employer has a url that on its face is not discriminatory, but in practice excludes too many people in a protected category
when are non-compete agreements related to the sale of business enforceable
if they are reasonable in time, activity, and territory
when are managers in violation of the corporate opportunity doctrine
if they compete against the corporation without its consent
what is consideration
inducement, price, or promise, that causes a person to enter into a contract and forms the basis for the parties' exchange -there must be a bargained-for exchange
what is an accredited investor
institutions or wealth individuals -to qualify individuals must have a new worth of more than $1 million or an annual income of more than $200,000
are unpaid internships covered by FLSA
interns have the right to be paid only if the employer is the primary beneficiary of the relationship
what does par value mean
its just a nominal figure -its not the same are market value
whats a letter of intent
letter that summarizes the main points of a negotiation or proposed contract
what is a lockout
management prohibits workers from entering the premises
what is an independent director
members of the board of directors who are not employees of the company
what is a sit-down strike
members stop working but remain at their job posts, blocking replacement works -prohibited, illegal
what is Regulation D
most popular route for private offerings
what does a trademark need to be valid
must be distinctive
do gifts and donations count as consideration
no
does the business judgement rule still apply when a manager engages in self-dealing
no
is a contract made by a minor (under 18) enforceable
no because they lack capacity under the law
are the union and employer obligated to reach an agreement
no but if there is no agreement they must go to binding mediation/arbitration
in general are employers required to give information about former employees
no but they can be held liable if they hold potentially dangerous information
does the SEC itself evaluate or investigate the quality of any offering
no, it simply ascertains that on the surface the company has disclosed all required info about itself and the security its selling
do someone need to register for a copyright
no, its only necessary if the holder brings suit to enforce the copyright
if the offeror doesn't mention a certain method or procedure for acceptance does the offer have to follow the mirror image rule
no, they can accept in any reasonable manner
does the company have an obligation to hire back workers after a economic strike
no, they can hire permanent replacement workers
are strangers liable of insider trading
no, they don't have a fiduciary duty to the company
what is duty of loyalty
obligation of a manager to act without conflict of interest -prohibits managers from making a decision that benefits them at the expense of the corporation
what is the minute book
official record of a corporation
what is an economic strike
one intended to gain wages or benefits
when is self-dealing valid
only when one of these happens: -disinterested members of the board of directors approve the transaction -disinterested shareholders approve it -transaction was entirely fair to the corporation
what is a social enterprise
organizations pledge to behave in a socially responsible manner even as they pursue profits -social mission is part of the Articles of Organization
what is preferred stock
owners have preference on dividends & liquidation
what is common stock
owners have voting rights but are paid after preferred stockholders
what is a quorum
percentage of voters who must be present for a meeting to count
what is an offeror
person who makes an offer
who is an incorporator
person who signs the charter & delivered it to the Secretary of State
what is a proxy
person whom a shareholder appoints to vote for them as a meeting of the corporation -also the document a shareholder signs appointing the substitute voter
what is an offeree
person whom an offer is made
what is a secondary boycott
picket line established not at the employer's premise but at a different workplace -illegal
what is a close corporation
private company whose stock is not publicly traded and usually has no more than 50 shareholders
what is the corporate opportunity doctrine
prohibits officers, directors and controlling shareholders from excluding their company from favorable deals
what is the Equal Employment Opportunity Commission (EEOC)
prohibits testing for prescription drugs unless a worker seems impaired
describe rule 14e-3
prohibits trading on inside information during a tender offer if the trader knows the information was obtained from either the bidder or the target company
what are the pros and cons of a sole proprietorship
pros -can run a business without taking any formal steps -not required to register with the gov't -not required to file a separate tax return cons -owner is responsible for all the business' debts -owner has limited options for financing the business
what are the pros and cons of a general partnership
pros -taxes pass through each partner cons -each partner is personally liable for the debts of the enterprise and the acts of the other partners
what are the pros and cons of S corporations
pros -limited liability -tax status of partnership cons -only one class of stock -no more than 100 shareholders -shareholder cannot be partnerships or other corporations -shareholders must be US citizens/residents -shareholders must all agree that the company should be an S corp
what are the pros and cons of an LLC
pros -limited liability -taxes flow through the members -flexibility: can have members that are corporations, partnerships or nonresident aliens -perpetual existence -easy to form: need charter & operating agreement cons -new form of business: legal uncertainties -if goes public, gets taxed like a corporation -existing members cannot transfer their ownership rights, nor can the LLC admit a new member without the unanimous permission of the other members
what are the pros and cons of a corporation
pros -limited liability -transferability of interests -perpetual existence cons -logistics, corporations involve a lot of expense & effort to create and operate -double taxed entities
describe the National Labor Relations Act (NLRA)
protects all employees who engage in collective activity, in connection with work conditions, as long as they are not supervisors -basically non-supervisory employees are able to discuss their working conditions, whether the discussion takes place in a lunch room or chat room online
what is the Sarbanes-Oxley act of 2002
protects employees of publicly traded companies who provide evidence of fraud to investigators
what is a design patent
protects the appearance, not the function, of an item
what is a utility patent
protects the function of the invention
what is forbearance
refraining from doing something that one has a legal right to
describe the Fair Labors Standards Act (FLSA)
regulates wages, limits child labor, and overtime
what is duty of care
requirement that a manager act with care and in the best interests of the corporation & use the same care that an ordinary prudent person would take in a similar situation
what is the mirror image rule
requires that acceptance be on precisely the same terms as the offer
what transactions are exempt from the 1933 act
section 4(2) of the 1933 act exempts from registration transactions by an issuer not involving any public offerings
describe the model act
shareholders acting in good faith & with proper purpose have the right to inspect & copy the corporation's minute book, accounts records, and shareholder lists
what is a direct lawsuit
shareholders are permitted to sue the corporation directly only if their own rights have been harmed
do employers have the right to hire/fire workers for smoking
some companies do but in roughly 60% of the states, employers cannot
how does FMLA define an immediate family member
spouse, child, or parent
what is treasury stock
stock that a company has sold but later bought back
what is stock that is authorized and issued
stock that has been authorized and sold -aka outstanding
what is stock that is authorized and unissued
stock that has been authorized but not yet sold
whats concerted action
tactics taken by union members to gain bargaining advantage
what does the holder of a copyright own
the particular tangible expression of an idea, but not the underlying idea or method of operation
where does a company generally incorporate in
the state where they conduct most of their business
can a plaintiff establish sexual harassment based on one severe even or a series of events that are unwelcome and over time present an uncomfortable work environment
they can establish it either way
how does an offeree accept an offer
they must say or do something to indicate that they want the offer -silence does not count
when do employers violate Title VII pertaining to work environment
they violate it if they permit a work environment so hostile toward people in a protected category that it affects their ability to work
what is picketing
to discourage employees, replacement workers, and customers for doing business with the company
what is the goal of affirmative action
to remedy the effects of past discrimination
what is disparate treatment
treated less favorably the others because of membership in a protected category
what are S corporations
type of corporation with a special S designated by the IRS
what does the NLRA prohibit employers from doing
unfair labor practices such as: -interfering with union organizing efforts -dominating/interfering with any union -discriminating against a union member -refusing to bargain with a union
what is termination by expiration
when an offer specifies a time limit for acceptance, that period is binding -if the offer specifies no time limit, the offer has a reasonable period in which to accept
what is an unenforceable agreement
when the parties intend to form a valid bargain, but a court declares that some rule of law prevents enforcing it
when can you patent living organisms
when they are genetical-engineered and not otherwise naturally occurring
what is plurality voting
winning candidate must receive the most votes, but not necessarily a majority -just need to receive more than competitor
after an ULP strike, are union members entitled to their jobs after even if the replacement workers have to be laid off
yes
are directors and officers liable if they make a decision that has no rational business purpose
yes
are employers liable for defamation if they give false references about an employee
yes
are oral promises during the hiring process enforceable even if they are not approved by the company's top executives
yes
are private employers permitted to test job applicants & workers for alcohol and illegal drugs
yes
can an insider avoid insider trading charges if she commits in advance to a plan to sell securities
yes
do employers have the right to fire workers for off-duty conduct
yes
does a corporation need to have atlas one class of stock with voting rights
yes
does destruction of the subject matter terminate an offer
yes
does the employee handbook create a contract
yes
is the promise to do something the same as actually doing that thing
yes
will the courts protect managers who make an informed decision, even if the decision ultimately harms the company
yes
does the NLRA guarantee the right of employees to engage in concerted action
yes for mutual aid or protection
