Chapter 2: Business and the Constitution

State Police Powers

States generally have the ability to regulate the: Health, Safety, Public Order and General Welfare of their citizens. (State Police Powers) Examples: Building Codes, Zoning Restrictions, etc.

Preemption

"Supremacy Clause" A doctrine under which certain federal laws preempt (or take precedence over) conflicting state or local laws. In case of direct conflict between state and federal law, state law is invalid. Or if there is a federal regulatory agency that is empowered to enforce federal law.

Federal Form of Government

A government that shares power between national and state governments. Each U.S. state government has inherent sovereignty (each state has the ability to power to govern itself). As a result, states also have police powers (Gives the state the ability to regulate certain affairs within their borders).

Procedural Due Process

Any government decision to take life, liberty, or property must be made equitably and fairly. A person must be given proper notice and an opportunity to be heard. The government must give a proper notice to inform them that they are going to build a highway over your home. The government also gives you the right to be heard which is a trial.

The Commerce Clause

Art. I §8 of the U.S. Constitution empowers Congress "[t]o regulate Commerce with foreign nations, and among the several States, and with the Indian Tribes." This clause prevents states from establishing laws and regulations that would interfere with trade and commerce among the states without a compelling reason. Only congress has the power to regulate commerce.

Privileges and Immunities Clause:

Article IV of the U.S. Constitution states that "Citizens of each State shall be entitled to all Privileges and Immunities of Citizens in the several States." (North Carolina can not treat citizens of other states differently without a substantial reason and a short time example for 4 weeks but not 4 years). A state may not treat citizens of other states differently from citizens of its own state without a substantial reason that is substantially related to the purpose of the rule.

The Legislative Branch (Congress)

Can override the president's veto. (veto: a constitutional right to reject a decision or proposal made by a law-making body). Can define the jurisdiction of the judiciary. (congress has the ability to say what type of court hears what type of case). Must confirm all federal judiciary appointees.

Taxing and Spending Powers

Congress has the "Power to lay and collect Taxes, Duties, Imposts, and Excises" which shall be "uniform" among the states. Gives the federal government the ability to tax you. Also gives Congress its spending power—the power "to pay the Debts and provide for the common Defence and general Welfare of the United States." Congress can spend revenues to carry out its expressed powers and promote any objective it deems worthwhile—as long as it does not violate the Bill of Rights.

Strict Scrutinty Test

Courts apply different levels of scrutiny (tests) to determine whether the law or action violates the equal protection clause. Strict Scrutiny: Inquiries involving the exercise of fundamental rights. The highest level of review a court can give a legal action. If the government is taking one of your fundamental rights, the court will review if the government can take away one of your fundamental rights.

Commercial Speech

Courts give substantial protection to commercial speech (advertising). Restrictions must implement substantial government interest, directly advance that interest, and go no further than necessary. (Courts can limit commercial speech to advertise your product)

Full Faith and Credit Clause (Art. IV §1):

Ensures that any judicial decision with respect to civil judgments will be honored and enforced in all states. If North Carolina passes a civil judgement then it will be enforced in all states. It prevents you from going to another state to have cases reheard that have already been decided. The full faith and credit clause protects the legal rights of American citizens as they move about from state to state. If you win a civil action in North Carolina and the defendant moves into another state, you can still claim that money.

Bussiness and Bill of Rights

First ten amendments to the U.S. Constitution are called the Bill of Rights. There to limit government power/ authority All apply to natural persons and most apply to business entities as well. (Applies to all people in this nation as well as businesses).

Substantive Due Process

Focuses on the content of the legislation (the right itself) instead of the fairness of procedures. Substantive due process limits what the government may do in its legislative and executive capacities. Fundamental Right: Includes interstate travel, privacy, voting, marriage and family, and all First Amendment rights. A state must have a substantial reason for taking any action that infringes on a person's fundamental rights. Deals with the content of the legislation. In this nation you have what is known as fundamental rights guaranteed by the constitution. Substantive due process says if the government is going to take away one of your fundamental rights they must have a very, very compelling reason

The Executive Branch (President)

Has the power to veto legislation passed by Congress. Can appoint the members of the judiciary.

The Judicial Branch

Has the power to void the acts of the executive and legislative branches because they are unconstitutional.

Due Process

If the government is going to deprive you from life, liberty, or property they must give you what is known as Due Process Protection . There is substantive due process and procedural due process rights. Mandated by the due process clauses of the Fifth and Fourteenth Amendments and the equal protection clause of the Fourteenth Amendment. Under these clauses, no person shall be deprived "of life, liberty, or property, without due process of law."

Corporate Political Speech

In Citizens United v. Federal Election Commission (2010), the Supreme Court ruled that corporations can spend freely to support or oppose candidates for president and Congress. (The corporations have the same freedom of speech as we do). They are artificial people.

Fundamental Rights

Includes interstate travel, privacy, voting, marriage, and family, and all First Amendment rights.

Content-Neutral Laws

Laws that regulate the time, manner, and place—but not the content—of speech receive less scrutiny by the courts. The government can limit the freedom of speech on the time you say it, the manner, and the place that you can go about to express your speech. Laws that restrict the content of speech must have a compelling government interest. The government can have laws that restrict speech if they cause imminent danger. Example: Yelling "Fire!" in a crowded movie theater

Seperation of Powers

Legislative Branch (Congress): Creates laws. Executive Branch (President): Enforces laws. Judicial Branch (Courts): Interprets laws A system of checks and balances allows each branch to limit the actions of the other two branches. This system prevents any one branch from exercising too much power.

Limits on Federal and State Actions

Originally, the Bill of Rights was a limit on the national government's powers. (Originally the bill of rights limited the federal government's power). Over time, the Bill of Rights was "incorporated" to states via the due process clause of the Fourteenth Amendment. (Now the Bill of Rights applies to the federal, state, and local governments). Rights are not absolute. There are limits.

Freedom of Speech

Right to free speech is the basis for our democratic government. Free speech also includes symbolic speech, including gestures, movements, articles of clothing. Expression is subject to reasonable restrictions. There is a balance between the government's obligation to protect and citizen's exercise of rights. You have a right to express your expressions, but the government has an obligation to protect its citizens. A balance.

Self-Incrimination

The Fifth Amendment guarantees that no person can be compelled to testify against herself in a criminal proceeding. Can't be used in the civil case, but in a criminal case. This guarantee does not extend to corporations or partnerships.

Freedom of Religion

The First Amendment may not "establish" a religion or prohibit the "free exercise" of religion.

Searches and Seizures (4th Amendment)

The Fourth Amendment requires law enforcement officers to have a search warrant before searching or seizing private property. Officers must have probable cause in order to get a search warrant. Search warrants must be specific. General searches through personal belongings are illegal. They need a specific reason to search. They need to be specific. They need a time, place, and location. Generally, business inspectors must have a warrant, though a warrantless search is permissible for seizure of spoiled or contaminated food to protect the public.

Unprotected Speech

The Supreme Court has held that certain speech is unprotected by the First Amendment: I.E. "fighting words," defamatory speech (false speech that damages a person's good name, character, or reputation.), and speech that violates criminal laws (such as threatening speech or possession of child pornography).

Equal Protection

The Supreme Court has interpreted the due process clause of the Fifth Amendment to make the equal protection clause applicable to the federal government as well. Government must treat similarly situated individuals (or businesses) in the same manner. The government must treat everyone equally unless they have a compelling reason to do so. They can not make a law that favors one group over another.

The Establishment Clause

The establishment clause prohibits the government from establishing a state-sponsored religion (The religion of North Carolina) or passing laws that favor one religion over the other.

The Free Excercise Clause

The free exercise clause guarantees a person's right to freely exercise her religion. The government can't stop you from expressing your religion. Employers must reasonably accommodate sincerely held beliefs of their employees. The government can act in protecting the public when religious practices work against public policy and welfare.

Privacy Rights

The fundamental right to personal privacy is not expressly found in the Constitution, but implied from the First, Fifth, and Fourteenth Amendments. Privacy rights receive protection under various federal statutes and the U.S. Constitution. State constitutions and statutes secure individuals' privacy rights—often to a significant degree The supreme court declares that you have a right to protect your privacy For your right to privacy to apply you must have a reasonable right to privacy. Your right of privacy only applies if you have a reasonable expectation to privacy.

Expansion of Powers under the Commerce Clause

Today the commerce clause authorizes the national government to regulate virtually any business enterprise, including those that are Internet-based.

The "Dormant" Commerce Clause

When state regulations interfere with interstate commerce, courts must balance the state's interest against the burden that the regulation places on interstate commerce. Generally, state laws enacted pursuant to the state's police powers are presumed to be valid (relative to their effect on interstate commerce). BUT....If a state law substantially interferes with interstate commerce, it will most likely be held to violate the commerce clause and will be struck down.