Mgmt 211 Final

Best Available Control Technology

(BACT) applied to goals of the Clean Air Act and Clean Water Act, EPA approved technology to control pollution. For new stationary sources; can be required part of state plan to reduce pollution; and usually greater cost

NRC

(Nuclear Regulatory Commission) regulates nuclear powered fuel plants and their waste; license construction, monitor, sets standards for radioactivity, disposal, and emissions; the EPA is empowered to set standards for radioactivity in the environment and disposal of nuclear wastes as well as thermal pollution from plants and emissions from uranium mines and mills

Reasonably Available Control Technology

(RACT) applied to the goals of the clean air act, EPA approved forms of technology that will reduce the output of industrial air pollutants. Normally for previously existing stationary sources, and at a lower cost

Clean Water Act

(aka National Pollutant Discharge Elimination System (NPDES), 1972) set maximum permissible amounts of water pollutants that can be discharged into waterways; aims to make surface waters swimmable and fishable; EPA sets standards for: drinking water, recreation, wildlife propagation, and agricultural use; specifically outlaws thermal pollution, protects wetlands, prevents ocean dumping, and authorizes government oil cleanups; BPCT (existing) and BACT (new) implemented

injunction

(law) a judicial remedy issued in order to prohibit a party from doing or continuing to do a certain activity. Is an example of an equitable action

antitrust enforcement

1) Private parties - (individuals or businesses) have right to sue alleged violators of Antitrust Law; 2) Criminal - Department of Justice, Antitrust Division (Sherman); 3) Civil - brought by either FTC or Justice Department; 4) Sherman Act - (violations are most severe) either criminal felonies (fines or prison) or civil injunctions (damages); 5) Clayton Act - different than Sherman, Department of Justice and private individuals can bring civil suit, usually FTC (investigates and issues cease/desist); 6) FTC act - prevent mergers, substantial civil penalties, overlaps Sherman without having to prove a criminal violation

reasons for growth

1) desire of companies to expand size of customer base; 2) acquisition of resources unavailable in the home country; 3) the need to keep up with rival firms; 4) technological change - telecommunication, transportation, data processing; 5) changes in government trade policies

market for executive talent

1) labor market for executive officers also includes corporate officers to act as faithful agents to shareholders; 2) if you distinguish yourself at one company, then you will be in demand at another; 3) Deborah Hopkins example

costs of regulation

1) not cost productive - do not necessarily get back benefits in proportion to money spent; 2) how do you put a value on benefits? 3) should look to see if society is benefited

regulation benefits

1) there are no perfect markets, regulation can help imperfect markets; 2) ease of operation - takes burden off Congress, experts in control, avoid political pitfalls; 3) specialized, more effective

scope of judicial review

1) typical appeals: procedures followed correctly, sufficient justification for agency's actions, misinterpretation of enabling statute, and was action within scope of agency power? 2) level of proof depends on procedure used - informal (review of statutory interpretation and procedural requirements) or formal (agency has to show substantive evidence)

adoption of the Constitution

1770s England is the most powerful country in the world; American colonies in the New World grow unhappy with mother country and KGIII - the cost of the French and Indian War fall on America through taxes, which were greatly resented by the colonists because they had no voice in Parliament to determine their own fate; colonists protest by boycotting taxed goods; Britain puts up naval blockade in Boston harbor; First Continental Congress forms, declares independence, Americans prevail in revolutionary war, Articles of Confederation adopted and dropped, Constitution eventually adopted supporting Federalism, separation of powers, and strong central government.

Andean Pact

1969, current members - Bolivia, Colombia, Ecuador, Peru, and Venezuela; first 20 years saw limited access; in response to Mercosur tried to rejuvenate this pact - customs union, common regulations on capital, agriculture and immigration; in 2005, aligned with Mercosur to form a cooperative agreement

employment at-will

A common law doctrine under which either party may terminate an employment relationship at any time for any reason, unless a contract specifies otherwise. Based on common law

option contract

A contract under which the offeror cannot revoke the offer for a stipulated time period. During this period, the offeree can accept or reject the offer without fear that the offer will be made to another person. The offeree must give consideration for the option (the irrevocable offer) to be enforceable.

business negligence

A. 'unintentional but careless or reckless conduct'; B. elements: 1) duty of care - arises when person should foresee that conduct would create unreasonable risk of harm to others, 2) failure to exercise care - reasonable person test, type of activity dictates degree of care, higher standard for professionals, 3) injury or harm incurred, 4) causation - breach must cause the harm, also 'proximate clause' - consequences must bear a reasonable relationship to the negligent conduct, harm must be forseeable

product safety regulations

A. common law - series of cases, evolution of products liability; B. Federally Regulated; C. "Information costs" and product safety - we pay to get info, it comes in many forms. Who should bear the risks when we are not willing to pay for information? D. Tort law and product safety-overview - someone is hurt by product, who sues? E. "Caveat emptor" (let the buyer beware) - if you bought it your problem, consumer bore all the information costs

Wagner Act of 1935

Also called the National Labor Relations Act. Established National Labor Relations Board; protected the rights of most workers in the private sector to organize labor unions, to engage in collective bargaining, and to take part in strikes and other forms of concerted activity in support of their demands. Was a key part of the New Deal, to reward labor workers. Government workers were mostly excluded

counteroffer

An offeree's response to an offer in which the offeree rejects the original offer and at the same time makes a new offer.

federal appointment of judges

Article III of the Constitution provides that the President shall appoint judges subject to confirmation by the Senate and that such judges shall serve for life (allows them to act impartially) or for as long as they desire.

APEC

Asia-Pacific Economic Cooperation; 21 members - four tigers, NAFTA, Chile, Japan, Russia, China, Australia, New Zealand; 40% of world trade; goal - free trade and investment area by 2010 for developed countries by 2020 for all members

Necessary and Proper Clause

Clause of the Constitution (Article I, Section 8, Clause 3) setting forth the implied powers of Congress. It states that Congress, in addition to its express powers, has the right to make all laws necessary and proper to carry out all powers the Constitution vests in the national government. Purpose of the clause is to give Congress the ability to account for all contingencies, is major source of Constitutional flexibility. Aka the Elastic Clause or the Implied Powers Clause

Regulatory Flexibility Act

Congress concerned with impact on small businesses of increased regulation, act in 1980: new regulations with substantial impact must be run through flexibility analysis, costs rule places on small businesses must be measured, must consider less burdensome alternatives, and agency must alert small businesses to forth coming regulations

substantive due process

Constitutional requirement that governments act reasonably and that the substance of the laws themselves be fair and reasonable; limits what a government may do. If the government can show a rational relation for the legislation to a legitimate governmental interest, then the legislative provides substantive due process

procedural due process

Constitutional requirement that governments proceed by proper methods, applies when the government deprives an individual of life, liberty, or property; limits how government may exercise power - protections are greatest when the government is taking an individual's life.

deceptive price advertising

FTC regulation of unfair/deceptive acts or practices; deceptive is considers a representation, omission, or practice that is likely to mislead a reasonable consumer and result in material harm to the consumer. This type of deception is usually informal - competing stores advertise different prices for a product; violation occurs if seller attempts to make price look more attractive than it really is, 1) false 2-for-1 deal; 2) 50% off regular price, price upped first; 3) 'bait and switch'

deceptive quality claims

FTC regulation of unfair/deceptive acts or practices; this type of deception is a two step process - must be claim in an advertisement and the claim must be shown to be deceptive in regard to quality of product. Standard of whether claim is implicit or explicit: 1) reasonable consumer, 2) ad is viewed in its entirety and in a reasonable context, 3) must be a reasonable basis for making the claim about the quality of the product (product must do what you claim)

Affirmative Disclosure Order

FTC remedy available, order requiring an advertiser to disclose all relevant information about a product, both positive and negative

corrective advertising

FTC remedy available, requires the affirmative disclosure by the defendant that past advertising claims were misleading. Illustrated in the case - Warner-Lambert Co. v. Federal Trade Commisssion

triad

GDP of world's economy was $40.9 trillion (2004), it is now $54.3 trillion (2007); the triad of US 25%, EU (all 25 members) 31%, and Japan 8%; the triad + Canada is 66% of world's GNP (the quad), down from 73% in 2004; they are a major source of highly skilled workers, innovative technology, and new capital; most important market for goods produced in developing countries

IBRD

International Bank for Reconstruction and Development (World Bank), one of the results of the Bretton Woods Agreement; purpose is to lend money to rebuild the infrastructure of war-torn Europe; result: Western Europe rebuilt, revitalized competitiveness and productivity

IMF

International Monetary Fund, one of the results of the Bretton Woods Agreement; purpose is to avoid the beggar-the-neighbor policies of post WWI Europe; new international monetary system - USD based fixed-exchange rate, ended in 1971; today is stands ready to assist countries that fare economic crisis

Kafauver-Harris Amendment of 1962

Investigational Drugs-Adverse reaction must be reported to the FDA (Caused by Thalidomide drug for morning sickness that caused flipper arms deformity in babies)

Standard Oil Trust

John D. Rockefeller cornered the oil industry - absorbed some competitors through stock transfers, squeezed others out of business and established a monopoly.

judicial interpretation

Judges and the Supreme Court justices interpret and apply the law and must be free to do so without the pressures of politics. The interpreting of the law includes interpreting the meaning of state and federal statutes and constitutional provisions, both state and national. Statutes are typically written in general terms thereby giving the courts the flexibility to respond to unforeseen circumstances and to adapt to changing conditions over time.

strict liability in tort

Liability without fault. Plaintiff does not need to prove defendant was negligent -- Plaintiff must show that the activity was unreasonable dangerous and that the plaintiff was injured by the activity

Standard Oil Company of New Jersey v. US

SC case 1911; The Supreme Court ruled that the federal government could break up trusts for "unreasonable restraint of trade", issue: was Standard Oil in violation of antitrust laws by trying to create a monopoly through mergers? The SC establishes Rule of Reason, but Rockefeller still loses, took 21 years to get him

Brunswick Corporation v. Pueblo Bowl-O-Mat

SC case 1977; example of how antitrust laws are not meant to be used. Brunswick bought bowling alleys on verge of bankruptcy and continued to operate them, Pueblo sued because they wanted the increased business - Court said this is not covered, injuries must be caused by the anticompetitive behaviors of defendants

SEC role in the market for corporate control

SEC designs regulations to ensure investors have necessary and accurate information about terms and implications of a takeover. The Williams Act of 1968 gives SEC most of its control over takeovers: 1) any prospective purchase of 5% of company stock must file SEC tender offer proposal; 2) prospective purchaser must notify target co. and its shareholders; 3) if board opposes (hostile takeover), board must file statements with SEC; 4) all takeover offers must be put on table for 20 days at least; 5) shareholders who agree to sell have 7 days after the offer expires to withdraw shares from sale; 6) if acquiring company raises stock prices, shareholders who tendered at the lower price can withdraw shares and re-tender at the higher price; 7) are defenses

Limited Liability Partnership (LLP)

Texas first state to have them 1991, used by professionals such as accountants, now open to everyone. It is a partnership so enjoys those advantages - no double taxation and profits are distributed to partners. But also limits the liability of the partners - varies from state to state, normally not liable for partners tort or contract (errors/incompetence). Created by registering with appropriate state official, annual fees for each partner, all partners have limited liability and can take part in management. Largely overshadowed by LLCs

Texas judges

Texas has a rather complex court system, due in large part to the Texas Constitution. To begin with, all Texas judges are elected in partisan (Reps vs Dems) elections, except for the judge of the municipal court which is usually an appointed position. This led to the belief that Texas judges can be influenced or bought by political contributions - judges must run expensive state wide elections so they take contributions and then the lending entity often feels the judge owes them once in office. Therefore candidates either have to be independently wealthy or accept political contributions from sources that will expect favorable rulings. Additionally, the voters of Texas tend to be uninformed about the judges

Commerce Clause

The clause in the Constitution (Article I, Section 8, Clause 1) that gives Congress the power to regulate all business activities that cross state lines or affect more than one state or other nations.

Patriot Act

This law passed after 9/11 expanded the tools used to fight terrorism and improved communication between law enforcement and intelligence agencies

voidable

__ contracts are valid contracts, but one of the parties to the contract has the right to avoid his or her contractual obligations without incurring legal liability. At least one of the parties is able to void the contract - is an option not a requirement. A contract with a minor is often a voidable contract because the law gives minors the right to disaffirm most contracts

partially disclosed agency

a __ __ __ is when the agent tells the third party that he is just an agent and that there is a principal but does not disclose the identity of that principal. In both disclosed and partially disclosed agencies, the third party knows he is dealing with an agent and not the principal and therefore, only the principal is liable under the contract

disclosed agency

a __ __ is when the agent tells the third party that he is only an agent and that there is a principal and the identity of the principal

void

a __ contract is no contract at all; it is not recognized by law. It produces no legal obligations by any of the parties, a contract to perform an illegal act such as hiring a hit man to kill someone is void and cannot be legally enforced by either party to the contract even if both parties want to perform the contract

valid

a __ contract is one with all of the elements necessary to entitle at least one of the parties to enforce it in court

consideration

a basic contract principle is that a promise, to be enforceable, must be supported by __. Is something of value that is given up in return for the promise is in the form of a return promise. Each of the promises is the consideration for the other. The requirement of consideration is to assist the court in determining whether the parties intended to be bound by their promises, that is, whether they intended to enter into a contractual exchange.

complaint

a civil lawsuit begins when a plaintiff files this with the clerk of the applicable court, which is also called a 'petition'. It must allege facts necessary to establish jurisdiction, and provide a short statement of the ultimate facts to be proved, the applicable law, and the remedy requested.

agency by ratification

a contract can also be created by ratification - in this situation someone without the agreement of the "principal", acts on behalf of the principal and after the fact, notifies the principal of his actions. If the principal agrees to the actions the agent has already done on his behalf, then an agency by ratification has occurred. However, the principal could just as easily have told the "agent" that he does not agree to the "agent's" action. In that situation the agent has bound himself to the agreement with the third party and the "principal" has no liability

mailbox rule

a contract offer to be valid it must be communicated to the offeree and received by the offeree before it becomes effective. However, the acceptance is valid when dispatched by the offeree if the acceptance is timely and properly dispatched. If it's improperly dispatched, such as being mailed with an incorrect address or sent in violation of the terms of the offer, then the acceptance is not valid until it is received by the offeror. This is called the __ __

executory contract

a contract that has not been fully performed by either party. These contracts "fix" future obligations, thus eliminating uncertainty and allocating the risk of future, unforeseen contingencies. An example is the agreement to repay a loan at some future date with a fixed rate of interest

venue

a court must have __ which, involves the right of a defendant to be tried in a proper court within a specific geographic area. In other words, of all of the courts which have jurisdiction, the court that will hear the case is determined by venue. Is not a factor until jurisdiction has been established, these rules are set forth by statute. Venue is usually based on the residence of the defendant and the general rule is that within a state, you can always sue the defendant where they live. However, because of liberal Texas venue rules you can sometimes get the defendant to come to you rather than you have to go to the defendant

Privacy Act 1974

a law that gives citizens access to the government's files on them

defense

a legal justification to commit an action without legal ramifications that would otherwise be considered a tort

Jim Crow Laws

a major historical event defining state's rights was the American Civil War and it's aftermath, which was fought primarily over state's rights with the major issue within the state's rights argument over slavery. This was a series of laws that were states' efforts to keep African Americans as second class citizens

natural monopolies

a market in which competition is inconvenient and impractical, and thus efficiency is best achieved by a single seller - utility companies and state governments regulated by governmental commissions that set the prices for the consumer. Public transport is regulated by several other agencies

unilateral mistake

a mistake by only one party which gives no relief to the contract terms

writ of certiorari

a party requests an appeal to the Supreme Court by filing a petition for __ __ __, it's reviewed by the SC and if granted the SC sends for the lower court record of the trial. Vast majority are denied, thousands of cases try to reach the SC each year, on average only 100-150 actually reach.

federalism

a system in which power is divided between the national and state governments, defines the US Constitution. how the US Constitution separates governing power among the various branches of the federal government and the states. This happens when local governments recognize the sovereignty of a central government and surrender certain powers to it, retaining other powers for themselves.

common law

a system of law based on precedent and customs, stare decisis - means that previously decided cases should be followed unless there is a good, legal reason to change the previous decision.

contract law

a system of rules for enforcing promises - contracts are a fundamental part of our economic system and the legal environment of business. At the societal level, contracts and contract law serve a valuable social function in providing a legal environment conducive to voluntary exchanges, which tend to move resources to more valuable uses. From the individual's perspective, contracts serve several important economic functions including the facilitation of mutually beneficial exchange and the allocation of risk among the contracting parties. Two distinct agreements are made - one deals with performance, the other with risk allocation; contract law provides a mechanism for the enforcement of both economic functions of contracts

rational basis test

a test the Supreme Court developed to determine if a law is discriminatory, which is applied to laws dealing with economic and social classes - 3 degrees of care. It is rare to see governmental activity declared unconstitutional based on this test. If on the other hand, the classification involves gender or legitimacy, the government in creating this type of classification must have a 'substantial governmental interest'. However, if the classification involves the exercise of some fundamental right or suspect classification such as race then to be justified a 'compelling state interest' must be found.

state court systems

a typical State Court system has at least one tier of trial courts and usually at least two appellate courts. Most state court systems are patterned after the Federal Court System. However, some states, like Texas vary significantly from the Federal Model.

negotiation

a very simple and common alternative to litigation, can be very informal. It can be done through the attorneys or sometimes it is more successful without them - meetings just between the plaintiff and the defendant to discuss settlement options. Approximately, 90% of civil cases settle prior to trial

other limitations on agency powers

a) president appoints agency heads and can remove them (agencies and departments); b) congressional control - committees oversee agency actions and control money/budget; c) interest group activity

Copyright Act of 1976

act affecting ip; 1) gave automatic right to people claiming copyright, and 2) lined out the registration process: obtain forms, fill them out, return to US copyright office, pay fee, and send a required number of workers

Lanham Act (Trademark Act of 1946)

act affecting trademark law; trademarks must be registered under this Act's terms (r = registered, TM = pending). Can be trademarked: colors or sounds. Cannot be registered: 1) flags of nations, 2) name/portrait/sig of living person, 3) exclusively geographic names, 4) descriptive terms. If trademark is unregistered, must prove secondary meaning - the trademark means something else to majority of public.

Insider Trading Sanctions Act (1984)

act dealing with insider trading; introduced civil and criminal penalties for insider trading; provides treble damages; includes aiders and abettors; 5 year statute of limitations; used in addition to Insider Trading Rule

Food, Drug, and Cosmetic Act

act in 1938; expanded the regulatory power of FDA - to foods other than canned goods, to false advertising, classify unsafe food as adulterated, new enforcement powers, form inspection systems, set the safe levels of additives in food. It switched the burden of proof from consumer to company, and made corporate executives responsible for violations

Clayton Antitrust Act of 1914

act meant to be specific and preventative of trusts, supplemented the Sherman Antitrust Act's list of practices that were objectionable, it covered activities Sherman could not, had low burden of proof (civil only), and only had to prove a significant probability of lowering competition. Clayton violation areas: price discrimination (Section 2), exclusionary principles (Section 3), tying arrangements (Section 3), and mergers (Section 7)

Taft Hartley Act

act that provides balance of power between union and management by designating certain union activities as unfair labor practices; also known as Labor-Management Relations Act (LMRA). Amended the NLRA: workers have the right to refrain from union activities and declared the federal gov neutral on labor issue. States could now enact 'right to work' laws, protected those workers who did not support the union. Outlawed 'secondary boycotts' and 'wildcat strikes'

administrative law judges

administrative agencies include specialized courts that conduct proceedings brought by the agency against alleged violators of agency rules. The decisions in such cases may be appealed within the agency - the final decision of the agency then may be appealed to the Federal Circuit Court of Appeals

FTC regulation of unfair advertising

advertising can be unfair without being deceptive.'Unfair', part of Section 5 of FTC Act, includes: causes/likely to cause substantial injury, is not outweighed by countervailing benefits to consumer or competition, injury must be one that consumers could not have avoided. The FTC Improvements Act of 1980 - ordered FTC focus on deceptive ads instead of unfair ads, by mid 1990s Congress again ready for FTC to regulate unfair advertising. FTC back in business with Joe Camel and tobacco industry

the role of advertising

advertising is any communication that businesses offer customers in an effort to increase demand for their products. Criticism of advertising - ads are tasteless and wasteful assaults on consumers' senses; creates false difference between similar products; allocates demand among competition; high expense of advertising make. Defense of advertising - offers real information about product; lowers consumers' cost of searching for goods; information allows consumer to make rational choice among goods

drug safety

after 1938, the FDA must approve drugs for sale, the FDA also designates prescription drugs (sold with physician's permission). With the Kefauver-Harris Amendment of 1962, the FDA was now also responsible for drugs proven effectiveness - the result: drugs cost $250 million and 12 years to develop, major area of criticism. The FDA enforcement power includes removal of product from market (misleading claims, not as safe as once thought)

contract acceptance

after an offer has been made, an acceptance reflect's the offeree's agreement to the terms of the contract. No particular form of words or method of expression is required by law but can be specified in the offer. However, an acceptance must be 'unconditional, unequivocal', and 'legally communicated'

ratification

after reaching the age of majority, an individual can ratify contracts formed as a minor, thus removing the ability to disaffirm. __ can be expressed through words, or may be implied from the individual's conduct.

directed verdict

after the plaintiff presents the evidence in the case-in-chief, the defendant may move for a __ __. In essence, the defendant is saying that the plaintiff has failed to sustain the burden of proof in proving the necessary facts thus, it would be a waste of the court's time for the defendant to present any evidence. The success rate for this type of motion is extremely low - the court generally requires the defendant to present evidence to make a complete record in the event of appeal, but allows the defendant to renew the motion after the presentation of evidence.

motion for new trial

after the verdict, the losing party can file this motion - however, the losing party will have to have a very good legal reason for the judge to set aside the verdict and start the trial all over again: newly discovered evidence, finding a missing witness

exculpatory agreements

agreement that releases one party from the consequences brought about by his or her wrongful acts or negligence

offeror

all contracts involve at least two parties; the party making the offer. They always promise to do or not to do something and thus are also a 'promisor', can be either party

offeree

all contracts involve at least two parties; the party to whom the offer is made. The party to whom a promise is made is the 'promisee', can be either one

Executive Orders

although the lawmaking authority of the President is limited by the Constitution, the President can create law by issuing ___ ___ and controlling the policies of the executive branch.

4th Amendment

amendment prohibiting unreasonable search and seizure without a warrant because people have the "right to be secure in their persons, houses, papers, and effects". Applies to individuals and corporations. The Exclusionary Rule has held that any evidence seized improperly must be excluded from trial.

5th Amendment

amendment promising that no person "shall be compelled in any criminal case to be a witness against himself". However, the guarantee is only given to persons and only applies in criminal cases, if the case isn't criminal there is no protection against self-incrimination. Also does not apply to corporations and most partnerships

illusory promise

an __ __ is an expression cloaked in promissory terms that does not actually involve a commitment by the promisor. For example, if a contract to supply raw materials at a specified price for a specified time contains a proviso that the price is subject to change without notice at the discretion of the supplier has not made a commitment to do anything.

unenforceable

an __ contract is a valid contract that cannot be enforced because of certain legal defenses. In this type of contract there is a perfectly valid contract in place but then the law changes and the contract becomes this way - neither party can force the other to perform under the contract. However, if money is still owed on the beer that was delivered prior to the law changing, that is still a valid contract obligation because at the time the debt arose the contract was enforceable

power of attorney

an agency relationship is normally created by the agreement of the parties and is often a written agreement called a __ __ __. Keep in mind that unless the facts of the agency relationship cause the agreement to be under the Statute of Frauds, the contract does not have to be in writing

equity law

another kind of judge-made law. Not that different from common law. Differences in procedures and remedies are all that distinguish the two. Not tried in front of a jury. Rulings come in the form of judicial decrees. Judges can issue orders that can either be preventive (prohibiting a party from engaging in a potential behavior it is considering) or remedial (compelling a party to stop doing something it is currently doing)

preliminary negotiations

another situation often encountered in contract law involving whether the intent of an offer has been made is in the area of __ __. It is common in commercial transactions for the parties to discuss a potential transaction in vague, general terms (inquiries) to determine whether an offer should be made. The test for an individual's intent in these negotiations versus making an offer is the objective standard of whether a reasonable person would have believed that a binding offer had been made

Quasi In Rem jurisdiction

another type of territorial jurisdiction involving the ownership of property. However, in this situation while jurisdiction arises due to the ownership of property in another state, that property is not the subject matter of the lawsuit. Historically, this has been abused and states have stretched its power, now it is subject to close Federal scrutiny - making establishing this jurisdiction nigh impossible

restraint of trade

any agreement between two or more parties that substantially reduces competition in the marketplace. In other words, rival firms must compete and cannot enter into any agreement to eliminate competition unreasonably

wetland

any area that are inundated or saturated by surface or ground water that support vegetation adapted for life in saturated soil conditions - swamps, bogs, marshes. Owner is forbidden from filling, dredging or draining; must have permit from the Army Corps of Engineers, they protect and regulate

Court of Criminal Appeals

appellate court; court consists of 9 members, 1 chief justice and 8 associate justices - each is elected in statewide elections; justices serve for 6 years, only elected every 2 years. Highest Texas court of criminal jurisdiction, only criminal; automatic appeal in death penalty convictions from District Court

Texas Supreme Court

appellate court; court has 9 members which are elected state wide in partisan elections for 6 year terms. Every 2 years three members of the court are elected. Jurisdiction: is the final court for civil and juvenile cases unless they involve a constitutional issue which can be appealed to the federal court system. Court also has several non-judicial functions including determining the civil rules of procedure for attorneys in trial practice, as well as, licensing procedures for the State Bar of Texas.

court of appeals

appellate court; there are 14 in Texas, in the major metropolitan areas of the state. The number of judges varies for each location (1 chief justice and others are associate justices); they are elected in 6 year overlapping terms; judge must be at least 35, with 10 years exp; jurisdiction of civil and criminal appeals - will either hear a case 'en banc' which means the entire membership of the court will hear a case, or in 3-judge panels; any case from the district court, county court, or county court at law can be appealed to the Court of Appeals if it involves a $100 fine, imprisonment or has a constitutional issue

punitive damages

are awards designed to punish individual defendants - the typical cases where punitive damages are awarded are for intentional torts and for negligence cases where the conduct was "gross negligence" or "willful or wanton" disregard for the plaintiff's safety. A number of appeals have asked that they be reduced citing the 8th Amendment (protection against excessive fines) - however the SC has ruled that punitive damages awarded by civil juries are not "fines". Browning-Ferris-Industries of Vermont, Inc. v. Kelco

preempted area

area where only the national government can act; up to Courts for determination

property intentional torts

basic property law provides a set of 'property rules' involving an outright prohibition against interference with property rights. Two basic types of property law: 1) real property - land or anything permanently attached to the land, 2) personal property - anything else, such as your clothes, vehicle, money, etc. Personal property can be 1) tangible - can be touched (clothing, vehicle), and 2) intangible - property that cannot be touched (stocks, leases)

pleadings

basic trial procedure - the natural starting point for a discussion of trial procedures is the __, the papers that are filed with the court. There are several types, such as: the petition also called, the complaint that is filed by the plaintiff, the answer that is filed by the defendant, and motions which can be filed by any party to the lawsuit.

equitable remedies

both common law and equity law rules are administered by the same court in all federal and most state courts and so, the difference becomes apparent only in the types of remedies a court gives; these remedies involve a court order to do, or not to do, something, such as an injunction. Furthermore, equitable remedies are generally only available where the monetary (legal) damage is too late or does no good

Limited Liability Company (LLC)

business entity; hybrid of a publicly held corporation and a partnership in which owners are taxed as partners but enjoy the benefits of limited liability. Created by filing 'Articles of Organization', owned by members with limited liability, similar to shareholders. Is the best one

product disparagement

business intentional torts; A. a form of defamation; B. essential elements: 1) untrue statement about plaintiff's product or property, 2) defendant knew statement was false, 3) malice, 4) special damages (loss of 1+ customers)

false advertising

business intentional torts; A. false statements are being made about the defendant's own products which give a false impression that defendant's products are superior to the plaintiff's; B. is 'any false description or representation of one's goods and services, which may damage a competitor'; C. Lanham Act

interference with prospective economic advantage

business intentional torts; A. not universal (not recognized in Texas); B. no contract required; C. definition - steal customers during negotiations - 1) must have intentional interference and 2) unreasonable and improper manner; D. examples: 1) predatory behaviors, 2) go into business simply to drive competitor out of business, then raise prices (monopoly)

intentional interference with contractual relations

business intentional torts; a party to a contract, under some circumstances, can sue a third party for interfering with the performance of the contract. A. elements: 1) valid contract between two parties, 2) a 3rd party, the defendant, must know of the contract, and 3) defendant must induce one of two original parties to break original contract and damage other original party; B. interfering with employment - 1) employment contract helps to define conditions, 2) difficult to prove if implied contract a) employment at will and b) Texas; C. The Ten Billion Dollar Jury Award - Texaco v. Pennzoil

agency duties

by entering into an agency relationship both of the parties owe the other party certain duties - an agent owes the principal: 1) loyalty, 2) obedience, 3) reasonable care, 4) accounting, and 5) notification

principal duties

by entering into an agency relationship both of the parties owe the other party certain duties - the principal owes certain duties to the agent: 1) cooperation with the agent, 2) payment, 3) reimbursement of the agent's reasonable expenses, 4) providing a safe work environment, and 5) indemnifying the agent for any losses

Landrum-Griffin Act of 1959

by late 1950s some unions were getting corrupt and forming alliances with crime organizations like the mafia to regain power lost due to Taft Hartley. This act regulates the internal affairs of American labor unions: financial affairs and the election of union officers. The result was that unions became among the most highly regulated private organizations in the country.

Rylands v. Fletcher

case; defendant built reservoir, reservoir broke into shaft of abandoned coal mine, flooded plaintiff's active mine, defendant did not know of plaintiff's mine - the defendant still liable. Introduced strict liability in tort. Limited to "Abnormal" or "Ultra-hazardous" activities, but not so unreasonable as to be prohibited altogether. "Liability without fault" - examples: keeping wild animals, and blasting with dynamite

Palsgraf v. Long Island Railroad Co.

case; lady indirectly injured at train station due to firework box explosion - defendant owes a duty of care only to those plaintiffs in the reasonably foreseeable zone of danger. In Texas - defendant must have known or should have known harm would result, while some states say defendant must be a substantial factor in bringing about the harm

trial court

civil court hierarchy; these courts are the lowest rung on the ladder, meaning that this is where the case begins - basic function is to determine the facts in a case from the evidence presented, they decide issues of fact and issues of law. However, it is very important because most of these courts develop the record of the case and the record will become the foundation for the appeal of the case to the higher court if an appeal is necessary. Some systems only have one trial court, whereas other systems have several - the Federal Court only have one general trial court while the Texas state judicial system has 6. All testimony, rulings by the judge, objections by the parties, admissible evidence, as well as other materials requested by the parties, become part of the record.

appellate courts

civil court hierarchy; these courts comprise the higher rungs of the ladder that lead to the higher courts in the system. They are primarily concerned with whether or not error occurred at the lower court - rule only on errors of law. To determine this, they rely on the record, the briefs of the parties, and oral argument. Procedure: 1) the 'appellant', appealing party, gives notice of appeal to the trial court and files a designation of the record which specifies all of the items from the trial that the party wants to include, 2) the appellant prepares a brief, a legal document citing precedent and proving error, 3) the 'appellee', the non-appealing party files a response brief trying to show that the appellant is incorrect and; 4) oral argument which occurs before the appeals court where both parties have 30 min each to orally persuade the appellate judges that their position is correct.; and 5) the decision of the appellate court - which might be months after the oral argument phase took place

bilateral contract

classification of a contract depends on what the offeree must do to accept the offer; if a return promise is required, then the contract is a __ __ since both parties are promisors - an exchange of promises is made "a promise for a promise"

unilateral contract

classification of a contract depends on what the offeree must do to accept the offer; if the offer is phrased in such a way that the offeree can accept only by performance, then the contract is a __ __. "A promise for an act"

free exercise clause

clause that protects the rights of individuals to free exercise of religion. Two principal areas where freedom of religion affects business are in the prohibition of certain transactions on Sunday, known as "blue laws", and when the employment relationship conflicts with an employee's right to the free exercise of religion.

Supremacy Clause

constitutional declaration (Article VI, Clause 2) that the Constitution and laws made under its provisions are the supreme law of the land

capacity

contractual __ refers to the ability of a contracting party to understand that a contract is being made and to understand its general nature. The presence of contractual capacity is normally assumed by the court, but a defendant that is desirous of avoiding contract obligations can attempt to prove that he or she lacked the capacity to enter a contract at the time the contract was made. Limited capacity can render the contract void or voidable (intoxication, insanity, or minor) - also have the ability to avoid liability under the contract under certain circumstances

basic corporate structure

corporation is owned by shareholders with voting rights; shareholders elect Board of Directors; the Directors oversee the running of corporation, shape its overall strategy, employ/appoint officers or managers to manage the daily affairs of the corporation; Managers - have power and authority to engage in all legal activities necessary to conduct corporation's business, often are members of the board of directors

Craft v. McConoughy

court case 1875; four grain merchants in Illinois entered contract to fix prices benefiting themselves. One merchant dies, son refused to abide contract, other three sue - Illinois Supreme Court rule price fixing was illegal restraint of trade, court refused to enforce the agreement.

footnote 59

declared that horizontal price fixing is always illegal - was defied by the Appalachian case, NCAA case and the BMI case which all looked at the facts and deemed the rule of reason approach was justified

procedural law

define the procedural means through which violations of rights and duties are remedied, "how of the law"

horizontal market divisions

division of market among competitors based on geography or other terms - eliminates competition within divided areas. If national firms get together and divide up the sales area - can give each a monopoly in each of the divisions in market (geo or functional). Ruling: customer, product or territorial allocations, if by two companies are per se illegal

forum shopping

due to the very liberal venue rules in Texas being abused by attorneys just to find the appropriate jurisdiction, __ __, steps have been taken in Texas to limit the resulting venue shopping. Historically, some Texas counties earned a reputation for awarding very large civil judgments where other counties earning the reputation of being very stingy in awarding civil judgments - so parties would regularly seek out favorable venues using the flexible Texas system. The limitations on this abuse are accomplished by requiring that the case should be tried in the proper court that is most convenient to all of the litigants

Articles of Confederation

during and after the Revolutionary War, the American Colonies were organized by this idealistic, yet wholly dysfunctional document, led to domination by the states and a very weak central government. The states were viewed as independent nations that had joined together in a federation to achieve common goals as a band of friendly, mutually existing neighbors. A major problem was that the states often treated each other in an openly hostile manner, in addition, the central government did not have the power to tax instead it relied on voluntary contributions from the states

duty of loyalty

duty a corporation owed to its shareholders; courts have low tolerance for breach of loyalty. Concern is that directors and officers will use position to benefit themselves. Corporate Opportunity Doctrine - if officer or director discovers a business opportunity he/she must first make it available to corporation.

Sarbanes-Oxley Act of 2002

early 2000s corporate governance scandals (Enron, World Con, Tyco, Adelphia) - public confidence shaken. Act created to restore trust in capital market: goals of S-O - 1) strengthen corporate governance of publicly traded corporations by new requirements on auditors, corporate board and corporate executives; created audit committee of the board of directors composed of outside members who oversees hiring/performance of its outside auditors, audit report to audit committee any disagreements with corporate managers. 2) CEO and CFO must certify financial statements are accurate. 3) include as internal controls report in the annual report to shareholders: must assess the effectiveness of the firm's internal controls overseeing financial reporting, and firm's auditor must then assess the accuracy of management's assessment of its internal controls. 4) eliminates most company loans to officers and directors (World Con). Also addresses problems within public accounting profession: created the Public Company Accounting Oversight Board, a 5 person committee supposed to establish and enforce ethical and auditing standards for auditors of public companies; auditors required to keep records for 5 years; accounting firms forbidden in providing certain types of consulting services to their audit committees (in response to Arthur Andersen-Enron)

least-cost avoider of risk

economic efficiency is enhanced not only by simple mutually beneficial exchanges (for example, where there is simultaneous creation and performance and thus no risk), but also by contracts designed to allocate (or exchange) risk. Some parties are better at minimizing the costs associated with risk - good examples of such people are grain dealers who engage in numerous buy and sell contracts so that the unexpected up or down fluctuation in the market price of grain will not be disastrous to them - able to hedge their risks on the basis of their specialized information

mutual agreement

element of a contract; fundamental to the formation of a contract is the mutual asset. Because a contract involves a voluntary transaction, the courts will not enforce the transaction unless it is clear that the parties agreed and assented to the subject matter of the contract - must be a "meeting of the mind"

fraud

elements are: 1) a misrepresentation has occurred, 2) there has been an attempt to deceive, 3) the innocent party has justifiably relied on misrepresentation, 4) the innocent party has been injured. Fraud only refers to misrepresentations of fact that are consciously intended to mislead another.

allocation of risk

evaluations of the contract terms prior to performance may differ substantially from evaluations of the bargain at the time performance is due. Presumably, all contracts are mutually beneficial when negotiated - however, the mutually beneficial aspects of the exchange at the time the contract is made may change as a result of the occurrence of some unforeseen contingency prior to the execution of the contract. The contract appears later to be one-sided to the extent that the performance of the contract is not mutually beneficial, nevertheless, contract law almost always requires the performance of such contracts and this suggests that the law implicitly recognizes the importance of risk allocation through contract

business entities

factors to consider: 1) ease and cost of raising capital; 2) desired length of existence of the business; 3) personal liability; 4) tax consequence of the form chosen; 5) ease of sale of the business

Federal District Courts

federal court system; each state has at least one, these districts do not cross state boundaries but some states are divided into more than one district - Texas has 4 (NSWE); a trial in federal district court is usually conducted by one judge, juries may be used if the parties are entitled to a jury trial and if one of the parties requests one. If a jury is utilized it usually consists of 12 jurors with two or more alternates. If both parties agree not to to have a jury, then the judge performs the functions of a jury.

Federal Courts of Appeal

federal court system; these courts are divided into circuits and there are 13 circuits. 11 of the courts number 1-11 cover different geographic regions of the nation, one is for the District of Columbia and the last court of appeals has nationwide but limited specialized jurisdiction over international trade, government contracts, intellectual property, etc.

state corporate law

filing for a corporation in a state is simple, called the Articles of Incorporation, fee is paid and corporate charter is issued - includes birth certificate and separate existence of the corporation. Can operate in "foreign" state, but state where file is the state that governs the law. Bylaws are rules that govern the operation of the corporation and like the Article of Incorporation, can be amended.

Justice of the Peace Court

first tier trial court; created by the Texas Constitution, is the same level as the municipal court. Where the municipal court is limited to violations of municipal ordinances and violations of class C misdemeanors, this court has jurisdiction over criminal violations of class C misdemeanors but also has civil jurisdiction over low dollar ($10,000 up from $200) amount civil cases. Number of justices dependent upon the population of the county; justices elected via partisan election; 800 justices, 4 year terms; justices can have the duty of official coroner

Small Claims Court

first tier trial court; created by the state legislature - statutory court of Texas. Courts are the equivalent to "People's Court". They were created so that the ordinary people of Texas would have a civil court in which they could present their case without the need of an attorney. The judge of this court is the same judge as the justice of the peace court; court only have jurisdiction over civil cases up to $10,000, with no jurisdiction over criminal cases

Municipal Court

first tier trial court; with several hundred of these courts in Texas and with cities basically left to determine the specifics of the ___ ___, obviously these courts are going to vary greatly from city to city. However, the judge of this court is usually appointed by the ruling body of the city, which is ordinarily the city council. The jurisdiction of this type of court is limited to violations of municipal ordinances, as well as, criminal jurisdiction over minor state crimes (class C misdemeanors) that occur within the city limits of that municipality. Until recently, courts kept no official record of their proceedings

corporate governance

formulating and monitoring the corporate process to shape its strategic direction and performance, define its mission and scope, and assess its interactions with affected groups. Also involves implementing the rights, responsibilities and accountability of: the shareholders, board of directors, and the managers

market for corporate control

if a corporation is not functioning as profitable as some other team of managers feel it should be, then that group or corporation might try to take over control - corporation become the target company; tender offer - acquiring company offers more than face value for stock attempting to purchase; friendly offer - where acquiring company asks the target board of directors to endorse takeover and recommend acceptance by the shareholders. This all provides incentive for the board to operate the company as efficiently as possible

scope of employment

if an agent engages in unauthorized intentional or negligent torts the principal is bound if the agent was acting within the __ __ __. To determine whether the agent was within it, the courts look to see if the act was similar to authorized acts of the agent, was the agent authorized to be where he was the time the unauthorized act occurred and was the agent serving the needs of the principal when the agent did the unauthorized act

appeal

if one of the parties is dissatisfied with the outcome of the case in the trial court, the unsatisfied party, whether they were the plaintiff or defendant, in the lower court normally has the right to have the decision reviewed by an appellate court. The purpose of an __ is to help guarantee that the parties to a lawsuit received a fair trial. For success, the appellant must submit a list of alleged errors of law that were committed by the trial court in a legal 'brief' which includes legal precedent to prove your points of alleged errors; appellee sends response brief to show the appellate court there were no errors; such errors could include rulings on objections by attorneys, rulings on the admissibility of evidence, or failure by the trial court to follow procedural rules.

mirror image

if the offeree adds terms through a purported acceptance, this operates as a counteroffer, which terminates the original offer as discussed above. Thus the terms that are accepted must be the exact terms or the "__ __" of the terms of the offer, nothing more or less. Further, the acceptance must be unequivocal and definite.

arbitration

if the parties are looking for someone to make a decision for them without going to court then __ is available. Similar to mediation, a 3rd party is involved, but unlike it the arbitrator makes a legally binding decision. In many areas of law, this is favored over litigation - true in the federal government and in more and more state governments. Arbitrators' awards are final, right to court is given up unlike in negotiation and mediation.

impact of SEC

impact on US's competitiveness in world markets - the United State policy is to give information. SEC also plays major role in formulation of the GAAP: uniform rules (consistent and transparent); all US companies must use in their statements; allows companies to be comparable to each other; not the case worldwide (Germany, Japan, France); more and more Asian and European companies are starting to use US GAAP to have better access to US investors

FTC and consumer protection

in 1938, Congress expands FTC's authority from antitrust to include regulation of unfair or deceptive practices. The FTC Bureau of Consumer Protection has the power to enact and enforce rules designed to prevent unfair and deceptive trade practices, procedure: FTC investigates, target can agree to stop engaging in unfair practice or target defendant can settle with FTC by agreeing to a consent decree (contract) including - redress for injured customers, payment of penalties, and prohibition of certain practices. If no settlement agreement, trial before ALJ who can dismiss complaint or issue cease and desist order; then can appeal to 5 member FTC which can affirm, modify, or reverse the ALJ's ruling; the FTC can also sue in US District Court appeal seeking an injunction, FTC publishes guide to help advertisers, advertisers can also request 'Advisory Opinions'

Delaney Clause

in 1958, gave FDA authority to set the safe-use level of food additives, had a zero risk standard - strict ban on harmful (cancer) additives ex. M&M colors

panel decision

in an appellate court, parties are given a limited time, usually 30 minutes to orally argue their points of error or lack thereof, before the appellate court. The appeal is usually before a 3 judge panel which then renders this decision but in some cases can be before the entire court which then renders an 'en banc' decision

types of judicial systems

in litigation, there are three types of judicial systems in which businesses might become involved. The business would find itself in a criminal court if the state or federal government accused it of violating some criminal statue. It would be in a civil court if it had a dispute with another individual or business that could not otherwise be settled. Finally, it would be in an administrative court if a federal or state agency accused it of violating one of the regulation which one of the state/federal agencies are empowered to enforce

restitution

in order to avoid a contract, a minor need only manifest an intention not to be bound by the contract. Words or conduct can manifest this intent to disaffirm the contract. If a minor disaffirms an executed contract, there may be a corresponding duty to return the object of the contract to the other party, which is called the duty of __.

Article 1 Section 7

in the Constitution, specifies that the taxing power of the federal government is vested in Congress and all revenue bills must originate in the House. In practice, both the President and Senate exercise considerable influence on tax policy. In fact, the President often proposes tax bills to members of both the House and Senate in an effort to influence process.

Bill of Rights

in the First Congress, James Madison himself introduced 12 amendments, 10 of which were ratified and became this part of the Constitution. These first 10 amendments, which were a response to Virginia and other hesitant states and part of political negotiation, guaranteed personal rights and freedoms as well as state's rights.

vicarious liability

in tort liability the main issue is whether or not the agent acted within the scope of the agency. If the agent is doing what the principal instructed him to do, then the principal is liable. However, a principal can also be liable for the unauthorized torts of the agent. This is called __ __. If the agent is acting outside the scope of his authority and committed unauthorized, intentional, or negligent torts then only the agent is liable for these torts

federal law

includes all laws developed under the authority of the Constitution by Congress, the President, or federal regulations. State law, which includes ordinance passed by local governments, differs from state to state. The diversity of law sometimes seems beneficial in that it allows states to experiment with different types of laws, can serve as a 'laboratory' for the federal government

policy analysis

information-problem type of market failure results in consumer abuse is basis of FTC regulating deceptive advertising - without regulation, will not have necessary info about quality of product or price result is consumer is harmed. Those who oppose gov regulations say - consumers are not as gullible as we think, chances of harm not excessive; would be harmed anyway without gov interference; fraud less likely in high value products, consumers more careful. Opposition also says - market encourages fair, truthful advertising to increase goodwill, sellers will lose if deemed dishonest; competition will regulate competitors unfair advertising

antitrust remedies

injunction can be brought either by a private plaintiff or by the government. In addition to injunctions and monetary damages, there are other remedies in civil antitrust. Types: restrain conduct, force company to divest a subsidiary, use company assets to create competing companies, force other companies to use patents, licenses, etc. Remedies are only available if harm was the type that the antitrust laws are meant to avoid

law

is the collection of rules and regulations that determines how the government will treat its citizens, as well as how, in turn, its citizens will treat the government; plays two major roles in the business world 1) dispute resolution, and 2) regulation

pretrial conference

is the court's technique for pushing the case toward settlement or forcing the parties to prepare for trial. To prevent stagnation, the court is able to arrange conferences at which the parties report to the court the progress that has been made in settlement negotiations and trial preparations. Purposes: court uses to determine status-docket control; simplify the case issues; plan trial; judge orders ADR; settlement tool; there can be numerous conferences

In Personam jurisdiction

jurisdiction over the person; the most common way to establish territorial jurisdiction is by establishing jurisdiction over the parties to the lawsuit, this is accomplished by obtaining jurisdiction over the defendant. This includes the power to order the defendant to show up in court and to bind the defendant to the court's decision. This jurisdiction is done by serving the defendant physically with a 'summons' or 'citation' when they are voluntarily in the state you want to try them in

unionized employees

labor unions are within the private sector; only about 8% of workers are union; more union strength in the auto and steel industry; in the public, governmental section 38% of employees are union

dispute resolution role

law gives people and business entities a forum to settle their differences whether it be through the enforcement of contracts, the recognition of private property rights or some other legal issue.

Civil Rights Act of 1964

law passed by Congress to implement the decision in Brown and to guarantee civil rights to all peoples. The national government filed suit against numerous businesses that were discriminating against people who were not of the ruling majority white race and therefore, were in violation of this act, which forbids discrimination due to race.

Simpson-Mazzoli Law

law requiring all employees to present identification proof and authorization to work. Any employer who hires an illegal alien is punished accordingly

competition

lifeblood of capitalism, delivers best set of rules and outcomes for society as a whole. But, not always best for individual businesses: it can reduce profit and force costly changes

Article 1 Section 8

lists specific powers of Congress, including the power to establish and maintain an army and navy, to establish post offices, to create courts, to regulate commerce between the states, to declare war, and to raise money. It also includes the necessary and proper clause. Is the most significant power in regulating business

Health Insurance Portability and Accountability Act 1996

made changes to improve health-care coverage portability and accessibility and provide medical record privacy and security

mediation

many times, animosity between the parties or the attorneys or pride, prevent negotiation from being successful. Often it is necessary to have a 3rd party come in and assist in the settlement. In this situation, the litigant turns to a third party to serve as the mediator, hoping they can facilitate a settlement. They do not make a decision or take sides - their job is to point out weaknesses/problems and strengths of the claims, and using that push them toward a settlement. Not for every case; gives a case a chance to settle informally, less time, less expense, in private, without the bitterness of trial

relevant market

must be determined when proving intent to monopolize - 1) what is the product, product marketing; and 2) where is it sold, geographic market

judgment n.o.v.

occasionally, the jury will render a verdict against a party who had requested (and deserved) a directed verdict. Such a party can request the court to enter a __ __. The judge can reverse the jury's verdict if he or she determines the moving party is entitled to judgment as a matter of law, or may grant a new trial if the verdict was against the great weight of the evidence.

horizontal restraint of trade

occurs when businesses operate at the same level and generally in the same market - ex. cartel. Per se illegal

lapse of time

often, an offer by its term will allow the offeree a stated period of time to accept the contract. If the stated time expires without acceptance then the offer has terminated

undisclosed agency

one of the major reasons for entering into an agency relationship is to hide the identity of the principal - this is called an __ __. Therefore, if an agent does not disclose the existence of a principal, the third party only knows that he is dealing with the agent - the agent and the third party are bound to the contract. However, if the agent is acting within the scope of the agency, the principal, once he or she is disclosed is still liable to the third party. If the agent discloses or partially discloses the principal, then only the principal is bound to the contract assuming of course that the agent was operating within the scope of his authority

information sharing

operated under rule of reason - illegal to share information secretly, illegal to construct common price list. Only legal to share information in an open manner

Executive Order No. 11246

order issued by President Johnson in 1965 that required that all government contractors take "affirmative action" to ensure that their employment practices are not discriminatory.

defenses to negligence

part of business negligence; 1) influencing the potential plaintiff's behavior - what is the cost of avoiding the injury? and what is expected cost/loss from the injury? 2) assumption of risk - defined as voluntary exposure to a known risk, know of the risk and chose to take it, 3) contributory negligence - if both parties are negligent, no recovery, 4) comparative negligence - if both parties are negligent, compare negligence, 5) superceding cause - causal connection is broken by intervening act or cause

insider trading

part of duty of loyalty; an insider is any person who has access to confidential corporate information: employees, officers, directors, outside experts (lawyers, accountants, i bankers). Insider trading is where an insider benefits from trading in company stock due to insider information. Is breach of fiduciary duty and violation of federal law

self dealing transactions

part of duty of loyalty; two types - transactions between director or officer and the corporation, and transactions between corporations with common directors. Trend in self dealing cases: if deal is fair to the corporation, it will be upheld, deal will be set aside if involves fraud, undue overreaching, or waste of corporate assets. If court is not convinced deal is fair, then deal will only be allowed if deal was ratified.

rights of copyright holder

part of ip; 1) have the exclusive right to: reproduce, change, and perform the work; 2) exceptions: compulsory licensing (records, public show) and fair use doctrine (using for educational purposes)

remedies against infringement

part of ip; 1) if registered the remedies include: a. injunctions, b. impounding all the pirated copies, c. attorney fees, and d. actual or statutory damages; 2) if not registered: a. injunctions, b. impounding all the pirated copies, c. actual damages only, and d. not included are statutory damages and attorney fees; 3) to prove infringement: they access to the copyright or substantial similarity between copyright and pirated work

trade secrets

part of ip; A. anything the business wants to keep secret from their competitors; B. can include: formulas, customer lists, price lists, research, plans, marketing techniques, etc. C. State law: 1) must be original, and 2) must be secret; D. Uniform Trade Secrets Act (not very helpful); E. Must protect trade secrets - do whatever is necessary; F. Misappropriation damages: 1) profits that pirated material, 2) injunction, 3) possible criminal sanctions

trademarks and service marks

part of ip; A. these are not exclusively federal due to the Lanham Act and state/common law; B. purpose is to prevent customer confusion; C. Trademark is a logo, short phrase, symbol or name under which businesses operates or markets a product; D. Service mark is the same except it denotes a service (airline industry); Must be registered under Lanham - 'r' circled means registered, and TM means trademark pending. Duration is 10 years but they can be extended indefinitely. Apply for renewal 5 years in, and can lose if unused for 2 years

copyright duration

part of ip; duration was the author's lifetime + 50 years. But recently, by act of Congress, the Sonny Bono Copyright Extension Act of 1998 increased it to lifetime + 70 years. For the publisher: it's the lesser of 95 years after date of publication and 120 years after day of creation.

trade names

part of ip; these are earned designations, can be the same as a trademark. A. apply to part of all of business name: 1) goodwill of the business or 2) good name of the business; B. Cannot be registered (unless it's the name of product, then can be registered under Lanham); C. Normally under state law - 1) has to be earned, and 2) must be unique or fanciful

offer

part of mutual agreement; an __ is a promise that expresses the willingness of a party, known as the offeror, to enter into an enforceable agreement regarding a particular subject. To have a valid offer there must be 'intent, definite terms and conditions' and the offer must be 'communicated' to the offeree.

Section 402 of the Second Restatement of Torts

part of strict liability; (1) responsible if you sell a product in a defective condition unreasonably dangerous (2) rule 1 applies (a) even if seller has exercised all possible care (b) the user has yet to buy the product; sets forth consumer expectations test, strict liability.

ethical compensation

part of the justice tort law perspective; from the view of the victim, it emphasizes the fact that the payment of compensation is a benefit to the victim of the wrong, and declares that justice requires that the victim should receive this compensation.

ethical retribution

part of the justice tort law perspective; places emphasis upon the fact that the payment of compensation is harmful to the offender and that justice requires that the offender suffer the harm

Limited Partnership

partnership created by statute (state law). Formal requirements to create: file certificate of 'Limited Partnership', similar to the corporate form. Two classes of partners: 1) general partner - unlimited liability, fiduciary duty to limited partners; 2) limited partner - has limited liability, can take no part in management of the LP. The limited partners normally paid before general partners in dissolution

Norris-La Guardia Act of 1932

passed by Congress to outlaw yellow dog (antiunion) contracts and forbid the federal courts to issue injunctions to restrain strikes, boycotts, and peaceful picketing. (Essentially legalized unions and their strikes)

invasion of privacy

personal intention tort; A. defined as an invasion of a person's right to solitude, an unwarranted public exposure; B. types: 1) use of person's name or picture without permission (advertising), 2) intrusion into person's solitude (illegal wiretap), 3) public disclosure about a person which is offensive and objectionable (publish person's credit report), 4) publication of information which places a person in a false light (communist accusations 1940s); C. public figures lose much, but not all of their right of privacy (Brad Pitt); D. public records render information public; E. unwarranted does not mean unwanted

fraudulent misrepresentation

personal intention tort; A. elements: 1) misrepresentation of material facts or conditions, 2) knowledge that they are false or with reckless disregard for the truth, 3) intent to induce another to rely on misrepresentation, 4) justifiable reliance by deceived party, 5) damages suffered as a result of the reliance, and 6) causal connection between the misrepresentation and the injury suffered; B. 'con man' - reasonably duped standard; C. must be more than 'puffery' - seller's talk, opinion rather than falsehood only involves subjective terms; D. misrepresentation can occur through words, actions or concealment; E. falsehood can be 1) actual knowledge that is false, or 2) reckless statements, should have known was false

defamation

personal intention tort; A. intentionally making a statement that is false and injures a person's good name or reputation; B. types: libel (written, permanent form), and slander (oral, unrecorded speech); C. essential elements - 1) false statement (must know its false, malicious), 2) must be published/broadcasted to 3rd party, and 3) harm must be done; D. defenses: 1) truth is absolute defense, 2) privilege, when social interests prevail a. absolute - public policy favors complete freedom of speech (in court), b. constitutional privileges - statements made by legislators and public officials (Hutchinson v. Proxmire), and c. conditional or qualified - statement made in good faith with the proper motives (doctor AIDS call)

false imprisonment

personal intention tort; A. the intentional holding or detaining of a person within boundaries if the person is harmed by such detention; B. confinement includes: 1) physical restraint, 2) use threat to restrain, 3) force or threat against person's property, 4) retain someone in custody when supposed to be released; C. shoplifting - a major problem due to stores getting sued for capturing lifters only to get sued later - 1) shopkeepers privilege to prevent, and 2) some states have anti-lifting statutes to protect the shops

malicious prosecution

personal intention tort; A. the wrongful use of legal proceeding, either civil or criminal; B. difficult to win - 1) must win all lawsuits against you, and 2) then must prove that opposing party had no probable cause; must prove malicious conduct

assault

personal intention tort; is the intentional act placing a person in fear or apprehension of immediate bodily harm or offensive contact - A. reasonable person would be in fear; B. must know of action; C. fear can be legitimate even if threat cannot be carried out (unloaded gun, Hill v. Western Union Telegraph); D. business involvement: employee threatens someone or places a person in fear of harm, example security guard using his position to threaten a woman

battery

personal intention tort; the unlawful touching or physical contact without consent - carrying out the threat. A. touching can be clothes or other things identified as part of the person; B. touching does not have to be direct (gun, rock thrown); C. physical harm not required - just offensive.

assault and battery defenses

personal intention tort; torts that can occur together or separately, the legal justifications include: 1) Consent - permission given (expressed or implied), can go beyond the level of consent in sport, 2) privilege - legal immunity from liability (judges), 3) self defense - force allowed to reasonably defend self or others - A. reasonable amount of force; B. can use deadly force if it is first used against you; C. defending property - no deadly force part of common law while some state statutes allow; D. you have a duty to flee, and E. reality

concurrent powers

powers that are shared by both the federal and state governments. Congress can exclude or preempt state legislation when Congress chooses to act exclusively in a concurrent area. If a state attempts to pass laws in a preempted area, then there is a conflict with the Supremacy Clause

due process

principle in the Fifth Amendment stating that the government must follow proper constitutional procedures in trials and in other actions it takes against individuals

consumer remedies

private remedy for false advertising; common law - includes contract, must have offer and acceptance gives little to no remedy and tort law of deceit, customer must prove misrepresentation and intent by seller, not effective. Statutory remedy - express warranty under UCC customer must prove reliance, seller can usually prove consumer would have purchased goods even in absence of the advertisement.

competitor remedies

private remedy for false advertising; types of injuries - 1) false advertising attracts customers from competitor to false advertiser; 2) if false ad against competitor's product, can suffer loss of consumer goodwill; 3) false statements about the competitor will obviously hurt competitor. If false ad attacks competitor product, competitor can sue for disparagement (defamation). If false ad concerns advertiser's own product - is under federal protection, the Lanham Trademark Act of 1946

product market competition

private solution to the corporate governance problem; 1) product market may provide constraints, 2) firm must remain competitive, 3) to be profitable board must - develop new products, reduce costs, and eliminate waste, 4) if the industry environment is non-competitive, the board is not as restrained by product market competition

institutional investors and corporate democracy

private solution to the corporate governance problem; institutional investors are large, professionally-managed providers of capital, such as pension funds, insurance companies or mutual funds. Typically larger shareholders, 60% of a typical company on NYSE. In 1986, a group of institutional investors got together to create the Council of Institutional Investors (CII) to promote accountability of corporate executives

outside directors

private solution to the corporate governance problem; often outside directors are outnumbered by inside directors. Outside directors may feel obligated to the CEO or insiders for their position and will not be effective in overseeing the CEO and other officers. Solve problem by: 1) separate role of Board Chairperson and the company CEO, 2) increase number of outside directors on the board relative to inside directors, 3) increase the independence and power of the board

alignment of financial interests

private solution to the corporate governance problem; pay directors and corporate executives in stock, then all parties want value of stock to increase. This approach only lessens the problem, doesn't eliminate - directors and executives may still be motivated by other factors

promissory estoppel (aka detrimental reliance)

promises that are not supported by consideration, court usually enforces these promises. If a person makes a promise under circumstances such that it is easy to foresee that a reasonable promisee would be induced to rely on the promise and if the promisee changes his position in reliance on the promise, and if the promisee will suffer a substantial loss if the promise is not kept, then this may be used to enforce the promise. Ex. see someone selling money, possessions away while they depended on your promise - it will be enforced

intellectual property

property intentional port; A. this property is created from ideas or thought process of the creator; B. types: copyrights, patents, trademarks, names and secrets; C. very active area of the law; D. patents and copyrights are both constitutionally protected

trespass to real property

property intentional tort; A. defined as a person, without permissions who enters onto, above, or below the surface of land that is owned by another; causes anything to enter onto the land; or remains on the land or permits anything to remain on it after being told to leave, 2) No harm to the land is necessary, 3) reasonable intrusion into air space is permitted; B. the owner must implicitly or expressly (verbal, sign) establish that person is a trespasser; C. trespasser is liable for damages caused to the property and generally cannot hold the owner liable for injuries that the trespasser sustains except: 1) "reasonable duty", and 2) "attractive nuisance" doctrine; D. owner can use reasonable force to remove trespasser; E. defenses include assisting someone or protecting the propery, and non-defenses include ignorance and improving the property.

nuisance

property intentional tort; A. defined as any conduct which interferes with enjoyment or use of land; B. types: 1) 'public' affects the public at large, 2) 'private' affects one or a few people; C. must be reasonable interference; D. remedy: 1) damages and 2) injunction; E. must be non-contractual interference: 1) can settle nuisance issue by contract if small group affected, 2) breach of contract results in tort of nuisance, 3) example - you can do up to X, doing more than X results in nuisance, but if below X no tort

Freedom of Information Act 1966

provided a system for the public to obtain government records, as long as they do not invade individuals' privacy, reveal trade secrets, or endanger military security.

legal duties of directors (and officers)

public solution to the corporate governance problem; directors and officers owe a fiduciary duty of care to shareholders. Primary enforcement method is to hold directors and officers personally liable for corporate losses

social insurance

purpose of the law of torts perspective; according to this view, the party who is in the best position to spread the loss of the injury should be held liable. With respect to injuries resulting from products, for example, the manufacturer is often in the best position to cover the costs of compensation because the expected costs can be reflected in the price of the product - all the consumers thus bear some of the costs of accidents. Also applies to the deep-pocket theory: the business has greater wealth than the injured consumers do so the business should pay

justice

purpose of the law of torts perspective; law of torts viewed as the expression of a moral principle - one who by his fault has caused damage to another ought to make compensation as a matter of __. The principles of 'ethical retribution' and 'ethical compensation' support this position

compensation and appeasement

purpose of the law of torts perspective; means that the purpose of the law is to limit the negative impact of the infliction of injury to the event of the injury itself. Tort law provides a way to right the wrong without the injured party retaliating through some destructive means - victim's vengeance is bought off. The victim is appeased in two ways: 1) receipt of compensation and 2) knowledge of the fact that the transgressor is punished by being required to pay

damages

purpose of the law of torts perspective; most of the damages awarded in individual tort cases are intended to make the plaintiff whole again, at least financially. Such 'compensatory damages' usually consist of three major types of loss - 1) past and future medical expenses, 2) past and future economic loss, and 3) past and future pain and suffering.

deterrence

purpose of the law of torts perspective; some commentators view tort law as a regime of prevention. According to this perspective, the rules of tort law are designed to alter the incentives of interacting parties so as to control their future conduct in a manner that reduces losses due to accidents in the most efficient manner. This economic perspective has concentrated on developing legal rules that minimize the total costs associated with accidents. Thus, the deterrence view of the role of tort law not only concentrates on altering behavior so as to avoid accidents, but also generates public policy prescriptions based on efficiency: the party who is the "least-cost avoider" of an accident should be held liable.

railroad trusts

railroads were dominated by trusts and used the market power to increase prices at will. In 1887, after listening to the people Congress passed the 'Interstate Commerce Act' to regulate the railroads. Regulated through the ICC (Interstate Commerce Commission), but it was limited to deal with larger trusts

why have strict liability

rationale: 1) consumers ought to be given maximum possible protection from dangerous defects in products, 2) only the producer can prevent dangerous and defective products, forces them to cure defects, 3) simplifies inevitable result in court if use negligence and/or warranty theory, 4) manufactures receive benefits from sale of products and should be responsible for the burdens as well, 5) "social insurance" theory - manufacturer is better equipped than consumer to pay for damages

FTC deceptive advertising cases

recent cases: Diet Program Industries in 1993, Body Wise International in 2005, Enforma Natural Products, and Segee USA Group, Inc.

reverse incorporation

refers to Supreme Court's application of equal protection standards reading an equal protection component of the due process law of the 5th amendment; they apply it to national govt. and the 14th amendment applies it to states - so therefore no government is exempt from equal protection

partially executed

refers to a situation where one party has completed their part of the contract when the other party to the contract has not. (Truly refers to an executory contract)

Securities Exchange Act of 1934

regulatory control; act that regulates the re-sale of previously issued securities in secondary markets such as: NASDAQ and NYSE. Regulates the activities of stock exchanges, stock brokers, stock dealers, and other market professionals to ensure against: fraud, deception, unfair practices. Market professionals are expected to know the best interest of any particular investor. Act also requires disclosures about securities: public exchanged securities must be registered with SEC and issuers must file periodic reports with SEC. Also includes "Short Swing" profits rule and Insider Trading Rule

Securities Act of 1933

regulatory control; the stock market crash of 1929 led to federal regulation - this act regulates the initial sale of securities, discloses pre-purchase information, the SEC does not offer assessment of the offer.. Issuer must file registration statement with the SEC, with detailed information about the issuer: terms of the security, audited financial statements, short biographies of the corporation's top management, discussions of financial interests of the issuer, any conflicts of interests, risk of the investors, status of any potential lawsuits, and detailed information about the security. A Security (Howie test) is an investment of money into a common enterprise and with the expectation of profits to be generated primarily by someone else. Issuer who makes a material misrepresentation is liable as are: underwriters, corporate directors, signing corporate officer, and any outside experts. Violators are subject up to $10,000 fine and 5 year prison sentence

reporting requirements for insiders

requirements: 1) officers, directors, and 10% shareholders must register with SEC; 2) must notify SEC on timely basis of any stock purchases/sale, source of funds used to purchase stock, and reason for purchasing stock; 3) this tells people without inside information what the insiders are doing (often published in the Wall Street Journal)

civil courts

resolve disputes between private parties - these courts have judges and juries like criminal courts, but the procedural safeguards required by the Constitution are somewhat less than in criminal courts. This is because loss of liberty is not a remedy that can be imposed by this kind of court. Therefore, this court will normally not appoint an attorney for indigent parties because the Constitutional right to counsel only applies in criminal courts. Furthermore, the standard for proving the defendant responsible or liable in a civil case is by a "preponderance of the evidence" (more likely than not). Finally, parties cannot refuse to testify against themselves in a civil trial

Trademark Law Revision Act

revision in Lanham; resulted in a major change to the Lanham Act, allowing a company to secure rights to a name before actual use by declaring an intent to use the name, 3 years in advance

Federal Trademark Dilution Act of 1995

revision to Lanham; created exceptions for fair use in comparative advertising, noncommercial use, news reporting/commentary. Dealt with 'blurring' - unrelated product uses trademark, and 'tarnishing' - using a trademark in negative fashion

removal doctrine

right to have a state suit removed to a federal court if it involves more than $75000 and residents of more than one state

shareholders voting

rights of shareholders; common stock owners have right to vote based on the number of shares they own. They elect a Board of Directors and approve/disapprove of fundamental corporate changes - mergers, amendments to Articles of Incorporation. Election occurs at shareholder meetings which are usually held once a year, shareholders can also question directors at annual meeting

proxy solicitation

rights of shareholders; if shareholder can't or doesn't want to go to annual meeting can give proxy to someone else to vote their shares. Is regulated by the Securities Act of 1934; must disclose certain information to the shareholders - which directors they would vote for, which way vote on fundamental corporate changes

derivative actions

rights of shareholders; lawsuit filed by shareholders against someone or something who has financially harmed the corporation and the board of directors has chosen not to file suit. Shareholders must demand that the board of directors take action prior to filing the suit themselves, some require majority vote - if successful in lawsuit, damages go to the corporation. Some states require shareholders to post a security for expenses bond to be used to pay the defendants legal fees if shareholders lose. Derivative suit can be dismissed if: directors show decision not to file suit was based on good faith and legit business purpose or some states delegate authority to dismiss case to special legislation committee

shareholder proposals

rights of shareholders; shareholders have the right to make proposals at shareholder meetings - usually required to be in proxy solicitation, however some shareholder proposals can be excluded from proxy if: frivolous/repetitious or ordinary course of business. Rarely successful

forum non conveniens rule

rule limiting forum shopping in Texas, requires the case to be tried in the proper court that is most convenient to all of the litigants. In other words, if you sued the defendant train company in a far away, but generous county's District Court, expecting to receive millions of dollars, the defendant could file a motion with the court under this rule claiming that the away county is not the most convenient court for all litigants and if the judge agreed, the case would be transferred to the District Court in the county that was the most convenient court

vertical market restraint

rule of reason, when the manufacturer of a product tells its customers where it can sell the product or who it can sell to - territorial restraints (where) and customer restrictions (who)

administrative warrant

search warrant; low standard for attaining/they are easily obtained; often merely a technicality; gives government regulators right to inspect businesses

County Court

second tier trial court; a constitutional court created by the Texas Constitution - specified each of the 254 counties in Texas shall have one county court. Judges partisan elected; 4 year terms; both a trial and appellate court. Jurisdiction: 1) appeals from municipal court, small claims court, and justice of the peace courts, 2) is a trial court for criminal cases of a higher nature (class B and A misdemeanors), 3) civil cases between $200-$10,000, 4) juvenile matters, and 5) probate cases, according to the Texas Government Code

County Court at Law

second tier trial court; due to the number of constitutional limits placed on the county court, the legislature created a second type of county court. Judges partisan elected; 4 year terms; both a trial and appellate court. Jurisdiction varies: civil cases of up to $100,000; have the same criminal jurisdiction as a county court and also normally have the same probate jurisdiction; some courts deal with family law

District Court

second tier trial court; this court can either consist of one county or several counties - the District Courts of Brazos County are only courts for the residents of Brazos county. However, the 21st District Court covers Washington, Lee and Burleson counties. Jurisdiction includes: exclusive appellate, and original jurisdiction of all action, proceedings and remedies unless jurisdiction is given to another court according to the Texas Constitution; civil jurisdiction starting at $500 all the way up to multi-million dollar cases; family law, takes up a large % of the cases; felony criminal cases; juvenile cases

statutory law

second type of law, aka legislative law. The legal environment of business and especially the regulatory role of the law are almost totally defined by the Congress and state legislatures. The United States Congress has extensive power to pass laws (called statutes) that constrain businesses' behavior. The formal procedures for adopting statutes are set forth in the Constitution

Insider Trading Rule

section 10b within the Securities Exchange Act of 1934; applies to any situation where have misappropriation of material inside information for profit - means misuse of info was violation of duty and materials means it will likely affect the price of the stock. Insider information is nonpublic info obtained through your relationship with corporation (applies to anyone), Profit can be tangible or intangible, must be personal gain

"Short Swing" Profits Rule

section 16b within the Securities Exchange Act of 1934; states that capital gain made by buying and selling company stock within any 6 month period must be returned to the corporate treasury. It applies to all directors and officers and any shareholder owning 10% of company stock. There is a presumption of use of insider trading; there are no defenses; insiders have registration and disclosure SEC requirements; corporation supposed to bring suit, with shareholders then filing derivative action; cannot be avoided by resigning position or selling stock to be under 10%; profits are not offset by losses during 6 month period; penalties are very harsh

employer unfair labor practices

section 8 in the Wagner Act; it is unfair labor practice if an employer interferes with, restrains or coerces employees in the exercise of their rights to from labor unions and engage in collective bargaining

collective bargaining

section 8 in the Wagner Act; the employer must bargain in good faith with duly elected employee representatives. Mandatory bargaining subjects include: wages, hours, and other conditions of employement

corporate conflicts of interest

shareholders want to maximize value of stock now; corporate executive goals are to maximize their financial compensation, quality of life and status of corporate position; Directors goals are still different - well paid and want to keep their position; easily the interest of each can run counter to the desires/goals of the others

Small Businesses Regulatory Enforcement Fairness Act

small business regulation in 1996; permits Congress to review new federal regulations 60 days prior to effective date - new forum for adversaries to present arguments and more time for adversaries to fight regulations. Requires agency to prepare guidelines for small businesses. If courts feel agency fines are excessive, business can set legal expenses. This act created the 'National Enforcement Ombudsmen' within the Small Business Administration (SBA) - which serves as a clearing house for comments from small businesses, agencies are rates and result published

patent problems

some problems with this constitutionally protected form of ip: 1) they only last 20 years (why Coca-cola chose not to patent their secret); 2) it becomes public at the copyright office - thus people can see it, steal it, make it better; 3) can't get greedy with it, trust laws can take it away

commercial speech

speech that does not contain a political message of any sort; sometimes subject to regulation with respect to both content and method

political speech

speech that includes some political content is afforded the greatest protection under the 1st Amendment

Title VII of Civil Rights Act of 1964

states that a business must make reasonable accommodations for the religious practices of its employees unless it causes undue hardship for the business

14th Amendment

the 'equal protection' clause - no government can deny any person within its jurisdiction the equal protection of the laws. Passed shortly after the Civil War, original intent to protect slaves its use has been expanded to protect against other arbitrary national government distinctions. Declares that all persons born in the U.S. are citizens and are guaranteed equal protection of the laws. Due process by the state governments is guaranteed with this amendment

pretrial motions

the 3rd major type of pleading that is filed consists of __ __ which serve various purposes: 1) 'motion to dismiss for failure to state a claim' - designed to bring to issue the situation where a plaintiff cannot win legal remedy as a matter of law. 2) 'summary judgment' - this motion tells the court that both parties agree on the facts and the court can apply the law to those facts and enter a decision

adversarial system

the American courts operate through this system of justice. Courts will not decide lawsuits unless there is a true case or controversy between the parties to the action - a court will not decide hypothetical questions. Is based on the belief that truth and justice can prevail only if both parties to the action have the incentive to win. The possibility of being harmed by the outcome of a case encourages the parties to strive to uncover and present all information supportive of their particular position. By having all of the information presented in the best manner, courts are in a good position to evaluate the relative merits of the parties' cases

white primary

the Texas Democratic Party in 1927, the only political party, adopted a resolution allowing only the white citizens who were qualified to vote, to vote in the Democratic Primary. This action eliminated the minority vote, or at least postponed it until the general election, when there was one candidate who had been chosen by the white majority in the primary. In 1944, the SC decided that this practice was not 'separate but equal' and declared them unconstitutional in the case of Smith v. Albright

Texas court system

the Texas system is divided into two levels of trial courts, with the lowest level including minor trial courts, Justice of the Peace, Small Claims Court and Municipal Court. The remaining level of trial courts includes the Country Court and County Court at Law, as well as, the District Courts. The remaining level of courts are the true Appellate Courts

affirm, reverse, remand

the appellate court's decision may be one of three choices: 'Affirming' a lower court decision means that the appellate court agrees with the application of the law; 'Reversal' of a lower court decision generally means that the lower court applied an inappropriate rule of law and consequently reached an incorrect result; a 'Remand' implies that an inappropriate law was applied below and that the lower court did not find the facts necessary to reach a decision using the appropriate legal rule.

regulatory reform

the bureaucracy is not elected, thus they are easy to blame. Always calls to reform regulation. Types of regulation: 1) access to administrative process (freedom of info act 1966 and gov in the sunshine act 1976); 2) small business; 3) sunset laws; 4) deregulation (airline and telephone industry)

Shay's Rebellion

the chaotic economic relations between the states, plus the inability of the federal government to conduct basic governmental functions led to a movement to change the central government. This movement received a huge boost in the form of this rebellion, Daniel Shay was a farmer in Western Massachusetts; farmers were losing their farms and in an effort to stop the land foreclosures Shay led an armed attacks on the courthouses to prevent the creditors from foreclosing on the forms. Since neither the central government, nor the state governments, could raise a militia to stop Shay, leaders realized change was necessary - led to the Constitutional convention

elements of a contract

the common law of contracts has evolved a list of elements necessary to elevate a mere promise to the status of an enforceable contract, include: a) mutual agreement between the parties, b) consideration, c) contractual capacity of the parties, d) legal subject matter, e) genuine and real assent to the contract and f) some contracts must be in writing. The person attempting to enforce the contract must prove the existence of the first two of those elements; the defendant, against whom the contract is sought to be enforced, can prove the non-existence of the contract by proving the lack of one of the last four elements.

Article 1 Section 8

the contracts clause of the Constitution: "No State shall...pass any... Law impairing the Obligations of Contracts". The courts position has now recognized the superior rights of states to pass laws that impair contracts so long as the laws were consistent with the broad police powers of the states.

United States Supreme Court

the court of last resort for all cases decided in the federal court system and all cases appealed from the state's highest courts. Consists of 8 Associate Justices and 1 Chief Justice. All cases heard by the court are decided 'en banc' by a vote of all the justices. Jurisdiction is determined by Congress. Since the 1988 'Supreme Court Selections Act', Congress has given the SC total discretion of which cases will be accepted for review.

trial

the culmination of the arduous dispute resolution process known as litigation. Is the attempt by the plaintiff to prove the disputed facts which are necessary for the court to award the relief sought, and the attempt by the defendant to thwart the plaintiff. Steps: opening statements; witnesses called and cross examined; closing arguments; courts charge/instructions; and jury deliberates

counterclaim

the defendant may also want to set forth any cause of action that may exist against the plaintiff. This type of action would include anything that would allow the defendant to be a plaintiff in an independent suit against the plaintiff. A 'counter' - allow parties with disputes to settle all of their claims at once. Like an original complaint, the original plaintiff is generally required to file a reply (answer). And finally, the defendant can file a 'cross-action' and bring a 3rd party into the lawsuit

affirmative defenses

the defendant must include all __ __ to the allegations in the complaint - are legal defenses that must be proven by the defendant. The defendant can also challenge the court's jurisdiction or venue

answer

the defendant must respond to a complaint by filing an '__' within a statutory time period, usually 20 days. The response normally denies the allegations contained in the complaint - forcing the plaintiff to prove the whole case by a preponderance of the evidence. If the defendant in this required time period does nothing, then the plaintiff is entitled to go to court and take a 'default judgment' against the defendant - plaintiff gets everything they ask for.

federal subject matter jurisdiction

the federal courts are courts of limited jurisdiction, federal court subject matter jurisdiction may be established in 2 ways: 1) federal courts are empowered to hear cases involving 'federal questions', and 2) through 'diversity of citizenship' - the rationale for this means of access to the federal court system is embedded in the constitutional history of the US

checks and balances

the founding fathers feared a central government that had too much power, but realized from the experience with the Articles of Confederation that a government that was too weak was as bad as one that was too strong. Their challenge was to create a government strong enough, but limited still. The solution devised was to separate powers of the government into specific functions that together represented a strong central government, but would serve to operate as a system of ___ _ ___.

mutually beneficial exchange

the fundamental purpose of the law of contracts is to facilitate beneficial exchanges - contract law serves to reduce the costs of these transactions by imposing external rules which create rights and duties in the parties to the exchange and provides remedies in the event the duties are breached. The market controls dishonest and unfair behavior by reducing the demand for the goods and services provided by dishonest and unfair traders - market adjustments begin to act as an enforcement mechanism.

Constitutional Convention

the historic meeting of 55 US representatives of the 12 states in Philadelphia in May 1787 to draft a new agreement to set forth the basic functions of a new government. The document they eventually created was the Constitution of the United States of America, authored by James Madison. The primary ideological debate of the convention was over the need for a strong central government, but still limited. Thus, the central government's power was separated between three branches (legislative, executive, and judicial) where the power of each branch was limited by certain checks and balances from the other branches.

CPSC activities

the independent regulatory agency dealing with consumer product safety; primary activity is 'information, collection, and dissemination'. Gather information through: 'Injury Information Clearinghouse' which collects/analyzes consumer product injury reports, and 'National Electronic Injury Surveillance System' computerized system to receive reports of consumer product injury data from hospitals, manufacturers must also keep records, and hearings are conducted on product safety. The commission informs public, can issue consumer product safety standards and test product, and can remove the product from the market

antitrust individual exemptions

the major exceptions to antitrust: 1) labor unions (Clayton); 2) agricultural cooperatives or associations (not for profit to assist farmers); 3) state action - to regulate monopolies; 4) foreign trade - do not apply to US firms selling primarily to foreign consumers; 5) baseball - SC arbitrary ruling; 6) PACs and lobbying under Noerr-Pennington Doctrine

trespass to personal property v. conversion

the more extensive the answer to these questions, the more likely to be 'conversion': A. What was the extent of dominion or control? B. How long did the interference last? C. What was the damage to the property? D. What was the inconvenience or expense to the owner?

Federalist papers

the most influential support in favor of adoption appeared in a series of newspaper articles written by James Madison, John Jay, and Alexander Hamilton. Often used as a guide by the courts in interpreting the Constitution

panel decision

the number of judges appointed to a circuit court of appeals varies depending in part on the case load. Courts of Appeals cases are normally heard by a panel of 3 judges, opinions issued by the panels form a decision. Occasionally, controversial cases representing important public policy issues will be heard by all members of the court of appeals in a given circuit. The opinions issued in such cases are referred to as 'en banc'

jurisdiction

the power of a court to hear and decide certain types of cases. In order for a court to exercise its judicial functions, it must have jurisdiction over both 1) the subject matter of the dispute (subject matter jurisdiction), and 2) over the parties to the dispute (territorial jurisdiction).

judicial review

the power of the Supreme Court to declare laws and actions of local, state, or national governments unconstitutional

eminent domain

the power of the government to take private property for public use, it is another 5th Amendment Constitutional right of the people and of the government, but the government must have a reason to take the property and must give just compensation (not fair market value)

police powers

the power of the state to place restraints on the personal freedom and property rights of persons for the protection of the public safety, health, and morals, or the promotion of the public convenience and general prosperity, are reserved to the individual states. Specified in the 10th Amendment of the US Constitution, originating in Article 1 Section 1

discovery

the pretrial process by which each party obtains information from the opposing party or some third party with relevant information. Purposes include preventing surprise at trial and allowing the parties to adequately prepare their case, both of which will increase the likelihood of settlement of the case without trial. However, often discovery is used to harass the opposing party into submission, it requires your opponent to expend resources in complying with the requests

litigation

the process of a lawsuit - if a dispute with another firm, customers, or the government cannot be resolved through some mutual agreement and compromise, a lawsuit may be filed in order to have the issues resolved by the courts in this process

Constitution ratification

the ratification process for the Constitution was the same as the process provided for the ratification of amendments: 3/4th's of the states must ratify an amendment in order for it to become part of the Constitution. Previously, the Articles of Confederation required a a unanimous vote of all 13 states, Rhode Island wasn't at the convention so the representatives simply ignored that law to ratify the Constitution.

1st Amendment

the right of free speech. Although it appears to be written in absolute terms, "Congress shall make no law", the Constitutional guarantee is subject to certain limitations. It does not mean that individuals are free to say whatever they desire when they desire.

strict liability

theory of recovery for product injuries; 1) doctrine of strict liability - seller is engaged in the business of selling product, product is expected to and does reach consumer without substantial change in the condition it was sold, applies even if seller has used all possible care in preparing and selling products, and applied even if user/consumer did not buy the product from the seller; 2) elements necessary to establish liability under Restatement of Torts - injury from defective product, injury occurred due to defect, defect causes product to be unreasonably dangerous, product was defective when it left the manufacturer's control, thus liability without fault; 3) defenses: abuse/misuse of the product proximate cause of injury, or warnings were given and were disregarded (assumption of risk); 4) rationale for strict liability - requires compensation by manufacturer even if they exercised all reasonable care

warranty theory

theory of recovery for product injuries; 1) most products come with warranties, 2) this is a contract, 3) breach of warranty is a breach of contract, 4) Magnuson Warranty Act - written warranties must be "full" or "limited" and contain: instructions on how to remedy defect, to whom warranty extends, and any limitations on warranty periods. 5) Uniform Commercial Code section 2-314 provides that all sales by merchants include an implied warranty of merchantability (product is fit for purpose)

negligence theory of recovery

theory of recovery for product injuries; 1) to prove negligence, have to prove 'duty of care' first - duty owed to all persons within forseeable zone of danger (buyer, buyer's household, innocent bystanders) and must prove product is defective; 2) breach of duty of care - standard-reasonable design in light of current knowledge and technology, and Carrol Towing test ("cost benefits test") - manufacturers acting reasonably are not expected to incur greater safety costs unless the benefits of such greater safety provisions outweighs the costs; 3) causation - actual causer in fact, proximate cause or intervening causation; 4) defense to negligence suits - plaintiff has burden of proof, defendant has to prove affirmative defense - 1. assumption of risk, and 2. contributory/comparative negligence

agency by law

there are several situations where, due to the facts, the law creates an agency relationship. This is normally in emergency situations such as medical emergencies when a decision must be made and the parents or legal guardian is not available to make the decision

agency by estoppel

there is someone acting on another's behalf, but no official agency relationship has been established (no ratification). The "principal" doesn't stop the "agent" from acting as his representative, he allows the impression of an agency relationship to be established. Therefore, he is prevented, or estopped, from denying the agency relationship. This is creation of an __ __ __.

Sherman Antitrust Act of 1890

this act essentially outlawed trusts and broadly empowered the federal government to break up an existing trust as it saw fit. Makes it a criminal felony to engage in any contract to restrain trade or any actions dealing with intent to monopolize. Couldn't prevent the formation of monopolies, just punish successful ones. *Section 1*: made trusts between 2+ parties illegal via either Per Se or Rule of Reason; *Section 2*: outlaws any attempts to monopolize, punishes but does not prevent them

Anti-federalists

those who opposed the proposed Constitution, were headed up by the very influential Virginian, Thomas Jefferson - creator of the Declaration of Independence

Limited Liability Limited Partnership (LLLP)

tries to combine LLP and LP; a general partner can have limited liability, very limited in scope. Untested

joint venture

two or more firms from different countries agree to create a jointly owned, separate firm to promote their mutual business interests; one of the fastest growing forms of international business; typically combine the strengths of one partner company to address a specific business challenge; ex. General Mills in Europe with Nestle

implied contract

type of contract; contract that is implied from the conduct of the parties. It differs from an express contract in that the conduct of the parties, rather than their words, creates and defines the terms of the contract. When one takes a seat in the barber chair it is implied that he or she is bargaining for a haircut for a reasonable price even if no verbal obligations are made

Professional Corporations (PC)

type of corporation; available to professionals - attorneys, doctors, dentists, and accountants. They give limited liability to shareholders - except malpractice. Does give limited for - torts and contract liability. Advantages are largely overshadowed by LLCs

S Corporations

type of corporation; if corporation meets the requirements of S Corp.: then taxed like a partnership, no double taxation, and shareholders have limited liability like a regular corporation. Requirements for S: corporation must be domestic; corporation cannot be affiliated with a group of corp.; shareholders must be individuals - more than 100 shareholders - only one class - must not be resident aliens. Advantages of S Corp largely overshadowed by LLCs

request for production

type of discovery; a request that the other side produce certain requested documents that are relevant to the dispute at hand. Functions are to allow the parties to learn useful facts from the other party's records, to prevent your opponent from fabricating documents, and refusal to show a document means it could be disallowed to be introduced as evidence in the court.

request for admission

type of discovery; essentially a written set of facts that one party requests the other to admit as being true. The central purpose for such requests is to reduce the amount of evidence to be introduced at trial. Any facts that are admitted will not have to be proven at trial thus allowing the trial to concentrate on the facts that are in dispute

deposition

type of discovery; involve the oral testimony of witnesses before the attorneys for the parties and a court reporter. Principal function is to uncover all information "reasonably calculated to lead to discovery of admissible evidence", to 'preserve testimony' in case witnesses die before trial, and to force one's opponent to take an unalterable position. Questions can be asked and answered during this discovery that would not be allowed at trial under the rules of evidence. 'Hearsay' questions, testimony that is not firsthand knowledge, and responses are allowed in this because they may lead to the discovery of witnesses who do have firsthand knowledge and would be allowed to testify at trial.

patent

type of intellectual property; Constitutionally protected form of ip - is a grant from the federal government to the applicant to have right to make, use, sell or allow to use an invention. It must be registered with the US Patent and Trademark Office - is complicated and expensive; last for 20 years and cannot be extended; applied to: invention, improvements, processes, designs, asexual plants, etc. Once granted, the owner has exclusive right to patent

corporation

type of major business organization; most business is conducted by corp., is a separate legal entity, created in corporate structure. Parties in the corp. structure: 1) shareholders - owners, elect board of directors; 2) board of directors - runs corp and employs manager/officers; 3) managers/officers; 4) shareholders have limited liability

sole proprietorship

type of major business organization; oldest and simplest form of business organization. Most common form, no formalities to forming the sole-proprietorship, no special requirements to operate. Business and owner are the same thing

partnership

type of major business organization; two or more persons carrying on a business for profit. Can operate with no formalities, should have written, detailed partnership agreement specifying: 1) relation of partners to each other; 2) responsibilities of partners - management; 3) duration; 4) split of profits

intentional tort

type of tort; involves a deliberate action, which results in an injury. For example, a company commits an __ __ when it knowingly makes false statements about the quality of a competitor's products

strict liability

type of tort; is liability without any fault - you did the acts that resulted in the harm

mergers

violation area of Clayton antitrust act; joining of two or more companies into one. Is considered Rule of Reason. Firm concentration (proportion of relevant market served by the largest firms) and barriers to entry (any characteristics of the relevant market which make it difficult to enter and compete) are considered when determining merger legality. Types include: horizontal mergers (between competing firms), vertical mergers (two firms within same chain of production and distribution), market extension merger (between two firms in similar but not exact fields), and conglomerate mergers (firms which operate in distinct but related markets)

FDA

was created in 1927 and was given authority to administer the 'Pure Food and Drug Act of 1906', which addressed the sanitation and misbranding concerns which rose after the Spanish-American War and The Jungle by Upton Sinclair. The regulations promulgated by the FDA tend to prohibit and require certain types of activity and set certain standards

In Rem jurisdiction

way to obtain territorial jurisdiction over a nonresident defendant, this is where the state is given territorial jurisdiction over property located within their state and that property must also be the subject matter of that lawsuit. The property can either be tangible (land or car) or intangible (stocks or bond). Due to the subject matter property being located in the state, the state has territorial jurisdiction and the out of state defendant can be served with citation and be required to go to the jurisdiction state

rejection

ways to terminate an offer; where the offeree simply says 'no'

revocation

ways to terminate an offer; where the offeror takes back or revokes his offer prior to the acceptance by the offeree and, like the offer, it must be communicated to the offeree and is not effective until it is

what is anticompetitive?

we want competition to lead to better products or enhanced efficiency - means of competition just as important as the end. Defined as any deliberate actions by firms to outperform the competition by harming them rather than improving their own product/service. So, need rules and references to define and enforce activities to remove the detriments to the benefits of competition

trusts

were growing increasingly more powerful in the late 1800s - were originally where shareholders in several companies would put their stock in the hands of trustees whose job was to jointly control and manage the corporations hopefully making a profit which would then be distributed to the owners of the stock. However in the late 1800s, trusts were being used, through unethical means, to take over or destroy mostly small businesses in different industries thereby giving the trustees control over the entire industry; pro business attitude by courts and Republican domination both contributed

legislative intent

what the lawmakers who passed a law wanted the law to mean. If the language of a statute is unclear, judges will often look at the ___ ___ to help them interpret the law.

duress

when someone forces another person to enter into a contract against his or her will

resale price maintenance

when the manufacturer tells the buyer that they can not sell the product below a certain price. Is normally per se illegal, purpose is to maintain integrity of the product

undue influence

where someone mentally takes control of another person and substitutes their will for that of the victim

objective standard

whether the contract is expressed or implied, if all of the elements to a contract are present, it is enforceable. The enforcement and interpretation of a contract based on as __ __ of what would a reasonable person do in a like situation - 'reasonable person test'

intentional infliction of mental distress

personal intention tort; A. is the intentional conduct by a person that is so outrageous that creates severe mental or emotional distress in another. 1) has to be very outrageous and extreme conduct, and 2) beyond the bounds of decency; B. usually requires manifestation of physical harm (can be tension headaches); C. example - collection agencies and landlords

unconditional contract

type of contract; a duty of performance is absolute when the only occurrence necessary to require performance is the passage of time. Such a contract is an __ __.

multinational corporation

MNC; extensive international business involvement; usually owns or manages value-adding activities in several countries; extensive FDI to exploit - superior technology, well-known brand name, strong ties to an existing customer base

Consumer Product Safety Act

in 1972, first direct control over product safety by federal government - only applied to consumer products (personal consumption in home, school, recreation) and excluded industrial/consumer products covered elsewhere (tobacco, drugs, cosmetics, food, vehicles). Established the independent regulatory agency "Consumer Product Safety Commission", composed of 5 members appointed by President, 7 year staggered terms, no more than 3 members of one political party.

Food Quality Protection Act

in 1996, changed the Delaney Clause's zero risk standard to "reasonable certainty of no harm" standard. Expanded FDA jurisdiction to include over 9000 pesticides

unconscionable contracts

in addition to being unenforceable because of illegality, some contracts are unenforceable because they violate public policy. In essence, the courts find that such contracts have a negative impact on society and refuse to enforce them. Two particular types of contracts that violate public policy are __ __ that are grossly unfair one-sided contracts where one person is taking advantage of the situation and exculpatory agreements

Constitutional law

law derived from the Constitution, the most important legal and political document in this country. If any other laws of whatsoever type are found to be unconstitutional, then those laws cannot exist. The constitution is the considered the Supreme Law of the land.

regulatory role

law directs and standardizes activities that would otherwise be considered purely private interactions of individuals. Its role is typically justified on the ground that society has some stake in the outcome of the regulated activity and that the well being of society can be improved through government involvement.

substantive law

laws defining rights and duties, "meat of the law"

Nuclear Waste Policy Act of 1982

legislation that calls for selection and development of a permanent site of disposal for nuclear waste, no state wants to have these - controversial

Hand formula

method for determining what is reasonable behavior. The theory is the reasonable person takes precaution against injury if the burden of doing so is less than the loss if the injury occurs multiplied by the probability that the injury will occur. Failure to take precaution is a breach.

Smithian Model

model formulated by economist Adam Smith in 1700s outlining how greed and self-interest is both inevitable and vital within an economy - it can be used to drive advancement. Competition is created which eliminates problems - best values and efficiency become the focus. Smith felt competition was automatic self-corrective force, but when competition fails there then becomes need for government involvement (antitrust laws)

collective bargaining agreements

once in power for workers, union will try to negotiate a collective bargaining agreement, a labor contract. Typically lasts 3 years, sets forth specific details of employment relationship during period of contract: pay rate/increases, bonuses, vacation, overtime, and seniority in layoffs. Usually contain grievance procedures as well - way for employees to air their complaints

interrogatories

type of discovery; simply written questions which are served on the opposing party - cannot be used on third party witnesses. These can only be sent to another party as is true of requests for admission and production of documents as well. The responses to these forms of discovery are in writing and sworn to under oath. Are very popular in the legal world because they are easier and less costly than depositions - however, they are often limited to the number of questions that can be asked, the number of answers sought or the number of times they can be sent to the opposing party.

negligent tort

type of tort; is an unintentional tort that arises from the failure to use reasonable care toward one to whom a duty is owed, which results in injury. Unintentional torts occur in a variety of business settings that range from slip-and-fall accidents in a showroom to defectively designed products

price discrimination (predatory pricing)

violation area of Clayton antitrust act; change different buyers to different prices without justification (Robinson-Patman Act of 1936). Defenses include: volume discount, cost justify, changing conditions, meeting competition, and functional discounts

Federal Trade Commission Act

1914 act; prohibits "unfair method of competition in or affecting commerce, and unfair or deception acts or practices in or affecting commerce are declared illegal". Act established the FTC as an agency empowered to investigate and enforce antitrust law

Texas Court System Election Problems

: counties such as Brazos can be located multiple Courts of Appeals so citizens could be voting in as several different county or statewide judge elections at once; people do not know who they are voting for, don't research and vote purely due to party ID or advertising claims - thus Texas has poor quality judges in office; judge's pay it too low to incentivize attorneys to want to become judges; judge campaigns are too expensive, requires outside contributions - corruptible

workers' compensation

A form of insurance paid by the employer providing cash benefits to workers injured or disabled in the course of employment. Began in Wisconsin in 1911; death and disability benefits must prove injury occupational related arose in the course of employment; benefits cover medical costs, normally 2/3 of salary; company liable even if not wearing hardhat

employer-employee

A relationship that results when an employer hires an employee to perform some form of physical service. The employer has the right to control the physical conduct of the employee; employee doesn't represent employer in business transactions; no agency; employer may be liable for tort - aka master-servant

agent

A representative who acts on behalf of other persons or organizations. Through this legal relationship, the __ becomes a representative of the principal and can bind the principal to third parties in contracts and in tort law

EEOC

Equal Employment Opportunity Commission, Enforces laws to prevent unfair treatment on the job due to sex, race, color, religion, national origin, disability, or age. Administers acts all except the National Labor Standards Act

GATT

General Agreement on Tariffs and Trade; provided a cooperative environment in which nations could negotiate the reduction of trade barriers, 1947-1994; members agreed to apply the most favored national (MFN) principle in dealing with member nations - reduce trade barriers, encourage multilateral trade negotiations; was a major factor in reducing import tariffs; was not successful in reducing quotas or NQNTBs

NLRB

National labor Relations Board: (established by Wagner Act Section 3) is federal administrative (regulatory) agency to administer labor laws - Greatly enhanced power of American labor by overseeing collective bargaining; continues to arbitrate labor-management disputes today. Board members appointed by the president and confirmed by the senate

rescission

The practice of one party canceling or terminated a contract, which has the effect of returning the parties to their original positions before the contract was made.

how businesses are involved in tort

Ways: A. due to actions of business or its employees; B. due to business against another business; and C. due to business products. Why: A. successful business will be sued - 1) lawsuit happy society, and 2) business can afford it; B. unsuccessful business can also be sued. Follows the reasonable person standard

tort

a civil wrong other than a breach of contract for which the courts will provide a remedy in the form of damages to compensate the injured party. A crime is a wrong against society, and a __ is a wrong against a private party - are not designed to punish defendants, but to compensate injured plaintiffs through an award of monetary damages. The law of torts provides a set of legal rules that allows parties injured as the result of the actions of others, to collect damages under certain well-defined circumstances

executed contract

a contract that has been fully performed by all parties

horizontal group boycott

a refusal to deal, two competitors agree not to deal with other competitors on the same level of competition; purpose is to eliminate or discipline a competitor of the boycotting group. SC is clear - if the boycott involves horizontal agreements among direct competitors, the rule is per se

employer-employee agency

a relationship employee is hired to represent the employer - ex. managers and sales agents. Is a principal-agent relationship

Rule of Four

a writ of certiorari is granted whenever 4 SC justices vote, in secret proceedings, to review the case. Reasons to grant writ: when a state Supreme Court has decided a substantial federal question either unaddressed or conflicting with other SC rulings; or when there exists a conflict between the decisions of different federal circuit courts of appeal. The Court wants to avoid situations where different sets of rules are being applied in different regions of the nation.

per se rule

automatic violations under antitrust law; if you violate these antitrust areas then you are guilty/responsible period, cause is irrelevant - no real defense. Historic areas: horizontal market division, horizontal group boycotts/concerted refusal to deal, price fixing - horizontal, and tying arrangement

nutrition labeling

began in 1973 and expanded in 1990 with 'Nutrition Labeling and Education Act'; covered 250,000 food products through the Department of Agriculature - Meat and Poultry - purpose is to prevent misleading product claims and help consumers make informed choices. Details 'serving size' and standards for accurate health claims (fresh, low fat, low calorie, lite)

legal remedies

both common law and equity law rules are administered by the same court in all federal and most state courts and so, the difference becomes apparent only in the types of remedies a court gives; these remedies usually involve money

rule of reason

non-automatic violation under antitrust law; Court looks at facts and circumstances of the agreement, arrangement or other restraint. Can propose a wide variety of justifications for your actions. Areas: vertical non-price restraints - vertical price fixing, vertical allocation of markets, joint ventures and strategic alliances (exchange of information), licensing arrangements, and mergers

exchange ratio

price of one currency dominated in terms of a second currency; in 2004 - 1 USD = 0.5493 British pounds or 1 British pounds = $1.8204; in 2009 - 1 USD = 0.6287 British pounds or 1 British pound = $1.5906

Religious Freedom Restoration Act of 1993

prohibits the Federal Government from substantially burdening a person's exercise of religion except when the government can demonstrate that application of the burden to the person advances a compelling governmental interest and that it is the least restrictive means of furthering that governmental interest.

trespass personal property

property intentional tort; A. defined as wrongfully harming or interfering with the personal property owner's right to the exclusive possession and enjoyment of their property; B. involves intentional meddling (car vandalism); C. defense include if the meddling was warranted in good faith, example - Artisan's lien

conversion

property intentional torts; A. definition is illegal, wrongful taking of the property of another that places the property in the service of the trespasser; B. civil theft (don't have to prove intent to steal); C. includes trespass to personal property as well; D. defenses include: 1) necessity and 2) purported owner doesn't actually have superior right; E. non-defenses include: 1) good intentions, 2) buying stolen goods, 3) mistake

standing

the justice system's case or controversy requirement is generally easy to meet in the business setting. The few exceptions would involve actions to have a law or regulation declared invalid where there is no showing that the business has been harmed in any way by the law or regulation. The exceptions involve the issue of "__" and are very important in administrative agency law.

market share liability

theory of recovery for product injuries; each company that manufactured a defective product that caused injury would be responsible for a percentage of damages that is equal to their market share. 1) Sindell v. Abbott Laboratories - (DES case), problem - who made the DES: several manufacturers, no way to prove which made the pills that caused the plaintiff's injuries. Can not prove who made drug so sue a substantial share of manufacturer. This type of liability is limited so far to the DES cases (chemically identical drug cases)

vertical restraint of trade

two or more entities at different levels in a distribution chain act together to restrain trade

adjudicatory power

type of admin agency power; hearing before an administrative law judge (ALJ) who is an employee of the agency. Process: 1) file complaint; 2) violator notified; 3) agency investigates; 4) response; 5) negotiation ; 6) dismiss or take action; 7) hearing before ALJ (no absolute right to attorney, no jury, rules of evidence relaxed); 8) written opinion; and 9) appeal

conditional contract

type of contract; the duty of performance is conditional if something other than the passage of time must occur before performance is required. For example, a travel agent may book a block of rooms at a ski resort for the weekend so long as the snow pack is at least 80 in. The agent has created a __ __ under which there will be no duty to perform if the condition has not been met

quasi contract

type of contract; there is another type of implied contract but in reality is really not a contract - a __ __ is 'sort of' or almost a contract but there is something missing and it is therefore, not a true contract. However, one party is getting the benefit of the contract while the other party is getting taken advantage of, so the aggrieved party can literally throw themselves on the mercy of the court to supply the missing element to the contract and enforce it by law. This rarely done and with little success

Closely Held Corporations

type of corporation; also known as family, close or privately held corporations; they are created under state statutory law. Shares are held by a small number of people personally known to each other. Must follow corporate responsibilities - required corporate meetings and double taxation

copyrights

type of intellectual property; Constitutionally protected form of IP, covers: literary works, music, dramatic, photos, software, movies, etc. Does not cover: actual news events, historical or scientific information, or compilations of factual information. Copyrights are obtained by simply claiming and also through registry - remedies against infringers are greater when registered (statutory and attorney fees forgone)

tying arrangements

violation area of Clayton antitrust act; seller requires a buyer to purchase a "tied" product as a condition of purchasing the desired tying product. Per se illegal (really Rule of Reason but 3 things must be present)

exclusionary principles

violation area of Clayton antitrust act; where one firm is given the exclusive right, to the exclusion of others, to buy sell or trade another's product - exclusive dealing.

merger defenses

when mergers are allowed - failing firm defense, merger will enhance efficiency, power-buyer defense, lack of power in industry, potential competition

regulatory capture

when agencies adopt perspective of the industry to be regulated. Try to benefit from regulation, act in favor of the industry, business is interested; this was the predominate type during the first half of century

trade

exporting - selling products made locally in foreign country; importing - purchasing foreign products to use or sell in the home country; a trade deficit when a country imports more than it exports (US has had this for decades)

screwdriver plants

feared effect of NAFTA; is where a foreign, non-member makes something in its home country, slip it to member nation pre-assembled where only one screw needs to be put in, thus making it "made in.." and within the trade bloc; NAFTA has provisions to protect and limit against

economy-wide regulatory agencies

these types of regulatory agencies cover more than one industry. The FTC prevents unfair or deceptive advertising; the NLRB deals with labor in all industries. Some were created in the new deal era (FTC and NLRB), most were created in the 60s and 70s (EPA, CPSC)

MPRSA

to regulate intentional ocean disposal of materials, and to authorize any related research. While the Marine Protection, Research and Sanctuaries Act of 1972 regulates the ocean dumping of waste and provides for a research program on ocean dumping, it also provides for the designation and regulation of marine sanctuaries

law of comparative advantage

trade at the macroeconomic level promotes the efficient allocation of resources and enhances the productivity of the national through specialization; sets up the timeless argument of is it wise to allow foreign producers to sell their goods on equal footing with domestic producers

Mercosur

trading accord established in 1991, four founding members - Argentina, Brazil, Paraguay, and Uruguay; represents movement away from import-substitution growth theory; established a customs union; Bolivia and Chile joined later; performance has been impressive

Best Practical Control Technology

(BPCT) water pollution control standard in the Clean Water Act; applies to all previously existing sources (1972); for existing plants, cost severity and time were factors to be considered

CERLA

(Comprehensive Environmental Response, Compensation and Liability Act of 1980) the Superfund - regulates the cleanup of previously existing hazardous waste sites, waste spilled, stored or abandoned; amended in 1986; EPA duty to: identify hazardous waste, rank them, and put greatests risks on National Priority List; Superfund (from hazard product taxes) pays for cleanup; superfund is a tort law that imposes strict liability, joint, and several liability, is also retroactive; any party along the process can be the responsible party

FIFRA

(Federal Insecticide, Fungicide and Rodenticide Act) administered by the EPA; if a pesticide is found to pose an imminent danger or emergency, the EPA can suspend the registration and thus stop the sale of the pesticide; pesticides and herbicides must be (1) registered before they can be sold, (2) certified and used only for approved applications, and (3) used in limited quantities when applied to food crops. Penalties for registrants include imprisonment up to 1 year and fine no more than $50,000; penalties for commercial dealers include imprisonment for up to 1 year and a fine of $25,000

franchising

allowing a foreign firm to use one's operating systems brand names on business plan in return for a royalty payment; ex. Pizza hut, mcdonalds

Oil Pollution Act

(OPA) passed by the United States Congress to prevent further oil spills from occurring in the United States. Required companies to clean up spills within 12 miles of US shore/continental shelf, pay costs, and have a contingency plan. Requires all ocean oil tankers to be double hulled by 2015. It was written and passed into law after the 1989 Exxon Valdez oil spill. Administered by the Coast Guard. Also set up a $1 billion oil clean-up and economic compensation fund

RCRA

(Resources Conservation and Recovery Act of 1976) federal law governing the handling of hazardous materials; requires a permit for such transportation; also encourages environmental cleanup. EPA regulates; states have primary responsibility; amended in 1984 and 1986 - they decreased the use of land containment in the disposal of hazardous wastes and expanded the coverage to include more types of waste; civil penalties include $25,000 for each violation and criminal penalties can be up to $50,000 per day or up to 2 years imprisonment

Fair Labor Standards Act

1938 New Deal act; dealt with 1) minimum wage - federal level currently $7.25, state can be higher but not lower, 2) working overtime - more than 40 hours, 1.5x pay rate, and 3) child labor restrictions - 14-17 years old different rates and restrictions (can't interfere with school or be dangerous)

Bretton Woods Agreement

1944 agreement; 44 Allied Nations sent representatives to Bretton Woods, New Hampshire - goal: to construct post-war international economic environment that would promote peace and prosperity; all exchange rates were fixed in terms of the dollar (least affected by the war); the US stood ready to convert foreign holdings of dollars into gold at a rate of $35/ounce; created the IMF - aided countries on both sides of the war

Equal Pay Act

1963 act that requires men and women to be paid equally when they are doing equal work in the same organization. Concept of 'comparable worth' is not applicable in the United States

Single European Act

1987 EU act amended the Treaty of Rome; called for completion of the internal market by end of 1992; required 279 regulatory changes by the EU and implementation by all the member states; most, not all were implemented making the EC a real common market

NQTNB

(nonquantitative-non-tariff barriers); these are not quotas and not tariffs but can still be used as trade barriers; often embedded in legal on bureaucratic procedures, difficult to change, based on what happens to be legitimate reason; types - product/testing standards, public procurement, local purchase requirement, access to distribution systems, regulatory procedures, and investment controls

public choice analysis

1) nations of the world are very inventive in developing policies to promote domestic, home industries; 2) normally this hurts the domestic economy and the general public (Sugar Act, Jones Act); 3) why do countries do it? public choice; 4) public choice analysis - special interest groups are more willing to work for the passage of laws that favor them than the general public is willing to work to defeat such laws. Because of lobbyists, money, power, and apathy; therefore, development of nation's trade policy rarely is result of what is really in the whole country's best interest but rather the result of the interaction of domestic political forces and special interest groups

European Union

27 members - all democracies, free-market oriented economic policies, 491 million people, 31% of world's GDP; purpose is to promote peace and prosperity through cooperation; created with the 1957 Treaty of Rome, created the European Economic Community initially - 6 nations France, West Germany, Italy, Benelux nations; is polar opposite of NAFTA

express contract

A contract in which the terms of the agreement are fully and explicitly stated in words, oral or written. Job security is provided

Whistleblower Protection Act

A law passed in 1989 which dealt with complaints from bureaucrats claiming they were punished after reporting to Congress about waste, fraud, or abuse in their agencies.

Family and Medical Leave Act of 1993

Allows employees to take a total of 12 weeks' leave during any 12-month period, as long as they have worked 1250 hours. Company has to have at least 50 employees; reasons: for the birth of a child or serious health condition of the employee, child, parent, or spouse. Benefit can be denied to upper level employees

ASEAN

Association of Southeast Asian Nations in 1967; purpose - to create economic and political cooperation in region; members are the indonesian countries; created free trade area; goals - eliminate tariffs on manufactured goods imported in by 2003 and eliminate tariffs on most goods by end of decade

Toxic Substances Control Act of 1976

EPA controls testing of new chemicals; can require special labeling; can prohibit or limit manufacture or sale of toxic substances; administered by EPA; hundreds of new chemicals and their compounds that may be toxic are discovered each year

Occupational Safety and Health Act of 1970

Federal legislation designed to reduce job injuries; established specific federal safety guidelines for almost all U.S. organizations. Utilize administrative warrants; inspections; severe penalties for noncompliance - created and administered by OSHA

Title VII (Civil Rights Act of 1964)

Law that makes it unlawful practice for an employer to discriminate against any individual with respect to hiring, compensation, terms, conditions, or privileges of employment because of race, color, religion, sex, or nation. Have to have at least 15 employees

NAFTA

North American Free Trade Area 1994; free trade between United States, Canada, and Mexico; 2nd largest trading bloc in the world; goal was to promote economic prosperity for its members and further economic integration of the NA continent; members agreed to eliminate tariffs on most goods shipped to each other for 15 years; many FDI restrictions were eliminated

Schechter Poultry Corp. v United States

SC case 1935; was a decision by the Supreme Court of the United States that invalidated regulations of the poultry industry according to the nondelegation doctrine and as an invalid use of Congress's power under the commerce clause. Constitutionally invalid

Yakus v. United States

SC case 1944; a 1944 supreme court case which involved the federal government's efforts to control inflationary pressures that accompanied shortages of consumer goods in domestic markets during WWII. Constitutionally valid

implied contract

a contract in which the terms are not expressly stated but can be inferred from the actions of the people involved and the circumstances - based on employer's past actions, statements, policies and practices; employer promises an employee he can work there for as long as he wants

quota

a numerical limit on the amount of a good that can be imported into the country; types - absolute (states specific quantity), tariff-rate (specified amount at zero or low tariff, any above subject to high tariff)

administrative agencies

a primary tool for government regulation, considered the 4th branch of government. They began in 1887 with the 'Interstate Commerce Commission'. On the federal level, there are 50+ agencies and 15 cabinet departments

WTO

World Trade Organizations; began in 1995, successor to GATT - broader mandate and much stronger enforcement powers; 149 members, 1st decade of existence followed GATT; current initiatives - GATS, TRIM, TRIP, and agriculture

tariff

a tax imposed on a good or service that is being trade internationally; source of revenue for the central gov and imposed as a barrier to imported goods; types - import/export, transit (passing through one country to another), ad valorem (tax calculated on basis of good's value), specific (tax determined on per unit basis), compound (tax based on a combination of value and unit)

Mutual Recognition

established in the EU 1979; developed by European Court of Justice; if one member state recognizes a product as appropriate for sale, then all other EU members are mutually bound to do the same

Drug-Free Workplace Act

act applying drug-free awareness to only public companies with $25,000 worth of business with the Federal Government. Requires: statement forbidding possession of drugs in the workplace, warning of punishment, establishment of drug free program, and employee must notify employer of any drug convictions

Omnibus Transportation Employee Testing Act

act applying to certain federal employees - drug agents and public transportation employees. Test for alcohol and drugs; types of tests - preemployment tests, random drug tests, and post accident tests

Safe Drinking Water Act of 1974

act authorizing EPA to establish national drinking water standards; forbids dumping of waste into drinking wells; operators of public drinking water systems must use best available technology; landfills and pesticides of primary concern; states responsible, EPA flexible in enforcement otherwise

fair trade theory

active government involvement in international trade to protect domestic producers, ensure that the national businesses receive their 'fair share' of domestic and foreign markets; gov should erect barriers to foreign made goods; gov should promote the sale of domestically made goods in foreign markets - direct subsidies, tax incentives, cut-rate financing programs, and gov to gov negotiations

independent agencies

agencies created by Congress; includes Boards and Commissions - members are appointed by President with advice and consent of Congress. Are appointed for terms, only to be removed with cause. Supposed to be non-political - restrictions on make-up, usually cannot be overly dominated by one political party (bare majority only). Congress controls the money and so controls the agency

Clean Air Act

aka National Ambient Air Quality Standards (NAAQS) 1970 law to protect humans first and vegetation/climate second; executive agency created by Nixon EPA sets standards for pollutants; state enforcement; car emission standards set/plants emissions; RACT (existing), BACT (new), and MACT (toxic) implemented

disparate impact

component to prove discrimination under Title VII; occurs when an employer has a policy which on the surface seems neutral, but which has an unequal and unfair impact on members of a protected group. Employee must prove prima facie case, employer must prove business justification for practice, and employee must show there is alternative. Intent to discriminate no longer has to be proven

disparate treatment

component to prove discrimination under Title VII; occurs when protected classes are intentionally treated differently from other employees or are evaluated by different standards. Employee must prove prima facie (qualified and seeking job, turned down) case, employer must give non-discriminatory reason, and employee must show employer lied

employer-independent contractor

contract for a specific job and is not directly controlled by the employer. -example: plumber, gardener construction workers. The Employee is in control of the specific job, and cannot be told what to do by the person hiring them i.e. swims fire place example. he got pissed at the workers for goofing around but he couldnt tell them anything because he had no power over them.

GATS

current WTO initiative, The General Agreement on Trade in Services; effort to get countries to reduce trade barriers in the service industries; ex. international airlines industry - landing rights

TRIM

current WTO initiative, Trade Related Investment Measures Agreement; often trade and investment are complementary in nature, host countries restricting such investments hinder trade, therefore WTO members are in the process of establishing a set of rules on these types of investments

TRIP

current WTO initiative, Trade-Related Intellectual Property Rights; efforts to protect intellectual property rights internationally; basics of multinational corporations (MNCs) concern is that many countries to not protect firms intellectual property

international agriculture

current WTO initiative; goal to reduce barriers to trade in agriculture products a major continuing problem for the WTO; import restrictions and export subsidies that distort international agriculture are widespread; major part of the Doha Round negotiations

consequences of WWI

czar overthrown in Russia leads to communist takeover; Kaiser forced to abdicate in Germany; demand for war reparations from Germany leads to economic chaos; high unemployment across Europe; to improve economy took measures to stimulate their economies - devalue currency, import tariffs, beggar-the-neighbor policies; result was worse economic conditions than before

Latin America strategy

emerging market in global economy; relies on import - substitution growth; stimulate development of domestic manufacturing by raising barriers to imported goods thus give local manufactures opportunity to develop and grow; usually unsuccessful - domestic market too small to generate enough domestic competition

four tigers

emerging market in global economy; consists of - Hong Kong, The Republic of China (Taiwan), Singapore, and South Korea; since WWII they are now high income countries, newly industrialized economies; utilize export-promotion growth, develop economy relying on exports as source of growth; example of wisdom of liberalizing international trade

former Soviet areas

emerging market in global economy; converting over from Communism caused numerous problems; 3 areas better prepared than others - Czech, Hungary, Poland; Romania and Bulgaria not as able to attract foreign direct investment

China and India

emerging market in global economy; nealry 40% of world's population - important emerging markets; China - Communist to free market reforms in 1978, fastest growing econ, over 50% of China's GDP is produced by for-profit firms, still exerts many regulatory contracts over its economy; India - largest democracy in the world, 1991 opened up economy reduced trade/investment barriers and lessened regulatory burdens on its private factor

Treaty of Maastricht

formal name - Treaty on European Union, Nov 1993; primary provision changed name to European Union (EU); established common defense and foreign policies to strengthen Europe on the world scene; created the cohesion fund; created the Economic and Monetary Union - created the euro and called for European convergence on fiscal and monetary policies

free trade areas

forms and benefits of Regional Trading Blocs; defined - a group of countries that agree to reduce or eliminate trade barriers among themselves; goods and services created in a member country receive preferential treatment over goods and services produced in a non-member country; each member free to establish its own trade policy with a nonmember nation. Ex. *NAFTA, ASEAN, and APEC*

economic union

forms and benefits of Regional Trading Blocs; defined - common market plus intertwining deeper their economic integration by implementing similar economic policies; macro policies - fiscal, monetary, and tax. Micro policies - environmental and labor. Ex. The *European Union*

common market

forms and benefits of Regional Trading Blocs; defined - custom union plus members drop all barriers that hinder the free movement of labor, capital and other factors of production among them; goals - use factors of production, increased productivity, raising the standard of living in their citizens. Ex. The *EEC* was one (later became the EU which is an economic union)

custom union

forms and benefits of Regional Trading Blocs; defined - free trade area plus members also adopt common trade policies toward nonmembers; usually members agree to impose common external tariffs on all goods imported into the custom union. Ex. *Mercosur* and the *Andean Pact*

OSHA penalties

from the Occupation Safety and Health Act of 1970: for nonserious/serious violation, up to $7,000 per violation; repeat or willful violation up to $70,000 per violation; failure to correct violation, $7,000 per day; knowingly making a false statement in OSHA records, $7,000 per day; willful violation resulting in death, criminal violations; these can all be combined and can result in multimillion dollar fines

Montana statute

gives employees comprehensive protection from employment at-will; an employee can recover damages even if fired during the probationary period *discharge against "public policy" *in violation of written personnel policy *"not for good cause" *limits damages to 4yrs plus interest

fixed exchange-rate system

government promises to hold value of its currency to some major currency; as long as pledge can be honored, companies can make business decisions; if government can not live up to promise, chaos can result; ex. Panama, the Bahamas, Oman, Barbados to USD

contract manufacturing

hiring a firm in foreign country to produce goods for your firm to: take advantage of low labor costs, and avoid environmental, regulatory laws. Ex. Nike

Endangered Species Act

identifies threatened and endangered species in the US, and puts their protection ahead of economic considerations; EPA and Commerce Dept must designate critical habitats for each endangered species - can prevent projects in their tracks and there is no required compensation for use of the prohibited land; both gov and private persons cannot interfere with the endangered animal at all

types of agencies

industry-specific regulatory agencies: ICC - created to regulate Railroads; SEC - created to regulate the Securities Industry; and FCC - created to regulate Communication industry.

foreign portfolio investment

international investment; investor does not plan to actively manage the organization; mostly in stocks, bonds and other securities issued by companies headquartered in other countries; can be in securities by foreign governments

foreign direct investment

international investment; the investor expects/wants to actively manage the organizations, the investor owns more than 10% of the voting stock

free trade theory

minimal government involvement in international trade; reliance on free market will lead to better outcomes than politicians and bureaucrats can do; gov intervention will reduce benefits of international trade - discourages voluntary exchanges and robs citizens of chance to make themselves better off; gov intervention decreases the benefits national economy would gain through specialization created by theory of comparative advantage; free trade promotes the efficiency and productivity of the national resources and wealth of citizens

management contract

one firm contracting with a firm from out of the country to provide management service or operate facilities in their country for a fee; ex. hotel chains

executive agencies

part of the executive branch, usually created by Executive Order. Enabling legislation still comes from Congress and gives power to these agencies. Ex. Department of Labor - head is Secretary of Labor, OSHA is an executive agency within Department of Labor. Departments and Administrative Agencies - president can hire and fire head

licensing

permitting a firm in a foreign country to use all or some of its intellectual property in return for a royalty payment; ex. NBA

powers of administrative agencies

power comes from Congress - delegated. Enabling statute creates agency, defines its purpose and gives power to agency. The 'Administrative Procedures Act' (1947) defined procedural rules and formalities for all federal agencies, and made a rule book for administrative agencies.

SIP

state implementation plan; sets out the state's plan to implement the EPA standards. The EPA has subdivided each state into 'air quality control regions' (AQCR) and monitors each region to ensure compliance. Regions that do not meet the EPA standards are designated 'nonattainment areas' and the state must develop a plan to bring that area into compliance within a set period of time.

legislative (rule making) power

type of admin agency power; promulgation of rules and regulations (regs), they have force of Congressional statutes. 1) Informal - agency promulgates rules, notice given through print in federal register, public can send in written comments for 30 days (generally ignored). 2) Formal - proposal rules are promulgated, proposed rule notice published in federal register, formal trial hearings, and then final draft is published. 3) Formal/informal - formal procedures are required for substantive rules, informal is okay for procedural rules or interpretive rules (majority of rule-making through informal process)

enforcement power

type of admin agency power; the main job of most agencies. To enforce, information must be gathered. Types of investigatory power: 1) requiring businesses to self report and monitor (agencies cannot share information between themselves), 2) direct observation by the agency (may require warrant), 3) subpoena power (order person to appear). Types of enforcement: tests/inspections, processing applications, negotiations, settlements, etc.

judicial review of administrative agency

type of admin agency power; the right of judicial review: 1) must be timely - must exhaust all remedies or appeals within agency; 2) must have standing - adversarial relationship to the agency, must show members are affected and harmed by the agency's decision.

flexible exchange-rate system

value (price) of a currency fluctuates according to demand and supply for that currency in the foreign exchange market; value determined by demand by those wanting country's goods; supply of currency of country is determined by it's citizen demands for foreign goods; accomplished by large international banks, used by countries with solid free-market economic systems