BUSINESS LAW TODAY   Essentials 8 th  Ed. Roger LeRoy Miller - Institute for University Studies, Arlington, Texas Gaylord ...
Learning Objectives <ul><li>What is the common law tradition? </li></ul><ul><li>What is a precedent?  When might a court d...
Sources of American Law <ul><li>Constitutional Law. </li></ul><ul><ul><li>Found in text and cases arising from federal and...
Sources of American Law <ul><li>Administrative Law. </li></ul><ul><ul><li>Rulemaking--Rules, orders and decisions of admin...
The Common Law Tradition <ul><li>Early English Courts of Law. </li></ul><ul><ul><li>King’s courts started after Norman con...
Stare Decisis <ul><li>Stare Decisis </li></ul><ul><ul><li>Practice of deciding new cases based on precedent. </li></ul></u...
Equitable Remedies & Courts <ul><li>Remedy:  means to enforce a right or compensate for injury to that right. </li></ul><u...
Exhibit 1-1
Classifications of Law <ul><li>Substantive vs. Procedural Law </li></ul><ul><ul><li>Substantive: laws that define and regu...
Classifications of Law <ul><li>National and International Law </li></ul><ul><ul><li>National: laws of a particular nation....
Comparision of Legal Systems
<ul><li>A Federal Form of Government:  the federal constitution was a political compromise between advocates of state sove...
The Commerce Clause <ul><li>U.S. Constitution gives Congress the power to  </li></ul><ul><li>“ regulate Commerce with fore...
The Commerce Clause <ul><li>Gibbons v. Ogden  (1824). </li></ul><ul><ul><li>To Chief Justice Marshall, commerce meant all ...
Expansion of National Powers <ul><li>Wickard v. Filburn  (1942).  </li></ul><ul><ul><li>Purely local production, sale and ...
Commerce Power Today <ul><li>Theoretically :  the federal government has unlimited control over all business transactions ...
Regulatory Powers of the States <ul><li>Tenth Amendment  reserves all powers to the states that have not been expressly de...
Dormant Commerce Clause <ul><li>U.S. Supreme Court has interpreted commerce clause to give national government  exclusive ...
The Supremacy Clause <ul><li>Supremacy Clause:  Article VI of the Constitution provides that Constitution, laws and treati...
Taxing and Spending Powers <ul><li>Article I Section 8:  Congress has the power to “lay and collect taxes, duties, imposts...
Business and the Bill of Rights <ul><li>1791:  Ten written guarantees of protection of individual liberties from governmen...
First Amendment: Freedom of Speech <ul><li>Right to Free Speech  is the basis for our democratic government. </li></ul><ul...
Corporate Speech <ul><li>Commercial speech (advertising) is given substantial protection.  Government restrictions must: <...
Unprotected Speech <ul><li>U.S. Supreme Court has held that certain speech is NOT protected: </li></ul><ul><ul><li>Defamat...
Online (Obscene) Speech <ul><li>Protected or Unprotected? </li></ul><ul><ul><li>Some of Congress’ attempts to protect chil...
Freedom of Religion <ul><li>First Amendment  guarantees that “Congress shall make no law respecting an  establishment  of ...
Due Process <ul><li>Procedural:  any government decision to take life, liberty or property must be fair.  Requires: Notice...
Equal Protection <ul><li>14 th  Amendment:  A state may not “deny to any person within its jurisdiction the equal protecti...
Privacy Rights <ul><li>Fourth amendment protects against unreasonable search and seizures. </li></ul><ul><li>Griswold v. C...
Appendix  to Chapter 1 <ul><li>Finding Statutory Law. </li></ul><ul><ul><li>United States Code  (USC). </li></ul></ul><ul>...
Exhibit 1A-1
Appendix <ul><li>Reading & Understanding Case Law </li></ul><ul><ul><li>Legal cases are identified by a “legal citation” (...
Appendix <ul><li>Reading & Understanding Case Law </li></ul><ul><ul><li>Legal cases are identified by a “legal citation” (...
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  1. 1. BUSINESS LAW TODAY Essentials 8 th Ed. Roger LeRoy Miller - Institute for University Studies, Arlington, Texas Gaylord A. Jentz - University of Texas at Austin, Emeritus Chapter 1 The Historical and Constitutional Foundations
  2. 2. Learning Objectives <ul><li>What is the common law tradition? </li></ul><ul><li>What is a precedent? When might a court depart from precedent? </li></ul><ul><li>What is the difference between remedies at law and remedies in equity? </li></ul><ul><li>What constitutional clause gives the federal government the power to regulate commercial activities among the various states? </li></ul><ul><li>What is the Bill of Rights? What freedoms are guaranteed by the First Amendment? </li></ul>
  3. 3. Sources of American Law <ul><li>Constitutional Law. </li></ul><ul><ul><li>Found in text and cases arising from federal and state constitutions. </li></ul></ul><ul><ul><li>U.S. Constitution is the supreme law of the land. </li></ul></ul><ul><li>Statutory Law. </li></ul><ul><ul><li>Laws enacted by federal and state legislatures. </li></ul></ul><ul><ul><li>Local ordinances. </li></ul></ul><ul><ul><li>Uniform Laws (e.g.,Uniform Commercial Code). </li></ul></ul>
  4. 4. Sources of American Law <ul><li>Administrative Law. </li></ul><ul><ul><li>Rulemaking--Rules, orders and decisions of administrative agencies, federal, state and local. </li></ul></ul><ul><ul><li>Administrative agencies can be independent regulatory agency such as the Food and Drug Administration. </li></ul></ul><ul><ul><li>Adjudication--agencies make rules, then investigate and enforce the rules in administrative hearings. </li></ul></ul>
  5. 5. The Common Law Tradition <ul><li>Early English Courts of Law. </li></ul><ul><ul><li>King’s courts started after Norman conquest of 1066. </li></ul></ul><ul><ul><li>Established the common law—body of general legal principles applied throughout the English empire. </li></ul></ul><ul><ul><li>King’s courts used precedent to build the common law. </li></ul></ul>
  6. 6. Stare Decisis <ul><li>Stare Decisis </li></ul><ul><ul><li>Practice of deciding new cases based on precedent. </li></ul></ul><ul><ul><li>A higher court’s decision based on certain facts and law, is a binding authority on lower courts. </li></ul></ul><ul><ul><li>Helps courts stay efficient. </li></ul></ul>
  7. 7. Equitable Remedies & Courts <ul><li>Remedy: means to enforce a right or compensate for injury to that right. </li></ul><ul><li>Remedy at Law : in king’s courts, remedies were restricted to damages in either money or property. </li></ul><ul><li>Equitable Remedy : based on justice and fair dealing a chancery court does what is right: specific performance, injunction, rescission. </li></ul><ul><li>Plaintiffs (injured party initiating the lawsuit), Defendants (allegedly caused injury). </li></ul>
  8. 8. Exhibit 1-1
  9. 9. Classifications of Law <ul><li>Substantive vs. Procedural Law </li></ul><ul><ul><li>Substantive: laws that define and regulate rights and duties. </li></ul></ul><ul><ul><li>Procedural: laws that establish methods for enforcing and protecting rights. </li></ul></ul><ul><li>Civil Law and Criminal Law </li></ul><ul><ul><li>Civil: private rights and duties between persons and government. </li></ul></ul><ul><ul><li>Criminal: public wrongs against society. </li></ul></ul>
  10. 10. Classifications of Law <ul><li>National and International Law </li></ul><ul><ul><li>National: laws of a particular nation. </li></ul></ul><ul><ul><li>Civil vs. Common Law: Civil law countries based on Roman code (e.g., Latin America). </li></ul></ul><ul><ul><li>International: body of written and unwritten laws observed by nations when dealing with each other. </li></ul></ul>
  11. 11. Comparision of Legal Systems
  12. 12. <ul><li>A Federal Form of Government: the federal constitution was a political compromise between advocates of state sovereignty and central government. </li></ul><ul><li>Separation of Powers: Executive, Legislative and Judicial. Provides checks and balances. </li></ul><ul><ul><li>Legislative: enacts laws </li></ul></ul><ul><ul><li>Executive: enforces laws </li></ul></ul><ul><ul><li>Judicial: declares laws/actions unconstitutional. </li></ul></ul>Constitutional Powers of Government
  13. 13. The Commerce Clause <ul><li>U.S. Constitution gives Congress the power to </li></ul><ul><li>“ regulate Commerce with foreign Nations, and among the several States, and with the Indian tribes.” (Art. 1 § 8) </li></ul><ul><li>Greatest impact on business than any other Constitutional provision. </li></ul>
  14. 14. The Commerce Clause <ul><li>Gibbons v. Ogden (1824). </li></ul><ul><ul><li>To Chief Justice Marshall, commerce meant all business dealings that substantially affected more than one state. </li></ul></ul><ul><ul><li>The national government had the exclusive power to regulate interstate commerce. </li></ul></ul><ul><li>Today: commerce clause applies to e-commerce internet transactions. </li></ul>
  15. 15. Expansion of National Powers <ul><li>Wickard v. Filburn (1942). </li></ul><ul><ul><li>Purely local production, sale and consumption of wheat was subject to federal regulation. </li></ul></ul><ul><li>CASE 2.1 Heart of Atlanta Motel v. U.S. (1964). </li></ul><ul><ul><li>Motel that provided public accommo-dations to guests from other states was subject to federal civil rights legislation. </li></ul></ul>
  16. 16. Commerce Power Today <ul><li>Theoretically : the federal government has unlimited control over all business transactions since any enterprise (in the aggregate) can have a “substantial effect” on interstate commerce. </li></ul><ul><li>Practical Limits : Supreme Court has curbed federal regulatory powers in U.S. v. Lopez (1995) and U.S. v. Morrison (2000). </li></ul>
  17. 17. Regulatory Powers of the States <ul><li>Tenth Amendment reserves all powers to the states that have not been expressly delegated to the national government. </li></ul><ul><li>State have inherent “police powers.” </li></ul><ul><ul><li>Police powers include right to regulate health, safety, morals and general welfare. </li></ul></ul><ul><ul><li>Includes licensing, building codes, parking regulations and zoning restrictions. </li></ul></ul><ul><li>“ Dormant” Commerce Clause  </li></ul>
  18. 18. Dormant Commerce Clause <ul><li>U.S. Supreme Court has interpreted commerce clause to give national government exclusive power to regulate. </li></ul><ul><li>States only have a “dormant” (negative) power to regulate interstate commerce. </li></ul><ul><li>Dormant power comes into play when courts balance state’s interest vs. national interest, e.g., internet transactions. </li></ul><ul><li>CASE 2.2 Granholm v. Heald (2005). </li></ul>
  19. 19. The Supremacy Clause <ul><li>Supremacy Clause: Article VI of the Constitution provides that Constitution, laws and treaties of the United States are the “supreme law of the land.” </li></ul><ul><li>Concurrent: in few areas, both states and federal government share powers. </li></ul><ul><li>Preemption: when Congress chooses to act in a concurrent area, federal law preempts state law. </li></ul>
  20. 20. Taxing and Spending Powers <ul><li>Article I Section 8: Congress has the power to “lay and collect taxes, duties, imposts and excises.” </li></ul><ul><li>Today: if federal tax has a reasonable relationship to revenue production, it will be held constitutional. </li></ul><ul><li>Congress can spend tax revenues on any express or implied constitutional power. </li></ul>
  21. 21. Business and the Bill of Rights <ul><li>1791: Ten written guarantees of protection of individual liberties from government interference. </li></ul><ul><li>Originally: Bill of Rights only applied to the federal government. </li></ul><ul><li>Today: the Bill of Rights has been “incorporated” and applied to the States as well. </li></ul><ul><li>Some protections apply to businesses. </li></ul>
  22. 22. First Amendment: Freedom of Speech <ul><li>Right to Free Speech is the basis for our democratic government. </li></ul><ul><li>Free speech also includes “symbolic” speech, including gestures, movements, articles of clothing. </li></ul><ul><ul><li>Texas v. Johnson (U.S. 1989). </li></ul></ul><ul><ul><li>Hodgkins v. Peterson (7 th Cir. 2004). </li></ul></ul>
  23. 23. Corporate Speech <ul><li>Commercial speech (advertising) is given substantial protection. Government restrictions must: </li></ul><ul><ul><li>Seek to implement substantial government interest, </li></ul></ul><ul><ul><li>Directly advance that interest, and </li></ul></ul><ul><ul><li>Must go no further than necessary to accomplish. </li></ul></ul><ul><li>Corporations also have protected political speech (although not to the degree of a natural person). </li></ul>
  24. 24. Unprotected Speech <ul><li>U.S. Supreme Court has held that certain speech is NOT protected: </li></ul><ul><ul><li>Defamatory speech. </li></ul></ul><ul><ul><li>Threatening speech that violates criminal laws. </li></ul></ul><ul><ul><li>Fighting Words. </li></ul></ul><ul><ul><li>Obscene Speech is patently offensive, violates community standards and has no literary, artistic, political or scientific merit. </li></ul></ul><ul><ul><li>CASE 2.3 Lott v. Levitt (2007). </li></ul></ul>
  25. 25. Online (Obscene) Speech <ul><li>Protected or Unprotected? </li></ul><ul><ul><li>Some of Congress’ attempts to protect children from online pornography have been ruled unconstitutional restriction on free speech. </li></ul></ul><ul><ul><ul><li>Communications Decency Act (1996). </li></ul></ul></ul><ul><ul><ul><li>COPA (1998-challenged, in court). </li></ul></ul></ul><ul><ul><ul><li>Children’s Internet Protection Act (2000) which requires filters for computers in public libraries and public schools). Challenged, in court. </li></ul></ul></ul><ul><ul><li>What about “hate” speech on the web? </li></ul></ul>
  26. 26. Freedom of Religion <ul><li>First Amendment guarantees that “Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof…” </li></ul><ul><li>Establishment clause: no state-sponsored religion or preference for one religion over another. </li></ul><ul><li>Free Exercise: person can believe what he wants, but actions may be unconstitutional. </li></ul><ul><li>What about freedom of religion and illegal drug use? </li></ul>
  27. 27. Due Process <ul><li>Procedural: any government decision to take life, liberty or property must be fair. Requires: Notice and Fair Hearing. </li></ul><ul><li>Substantive: focuses on the content or the legislation (the right itself). </li></ul><ul><ul><li>Fundamental Right: requires compelling state interest. </li></ul></ul><ul><ul><li>Non-Fundamental : rational relationship to state interest. </li></ul></ul>
  28. 28. Equal Protection <ul><li>14 th Amendment: A state may not “deny to any person within its jurisdiction the equal protection of the laws.” </li></ul><ul><li>Government must treat similarly situated individuals (or businesses) in the same manner. </li></ul><ul><li>Courts apply different tests: </li></ul><ul><ul><li>Minimum scrutiny-economic rights. </li></ul></ul><ul><ul><li>Intermediate scrutiny. </li></ul></ul><ul><ul><li>Strict Scrutiny – fundamental rights. </li></ul></ul>
  29. 29. Privacy Rights <ul><li>Fourth amendment protects against unreasonable search and seizures. </li></ul><ul><li>Griswold v. Connecticut (1965) found a right to personal privacy implied in constitution, expanded in Roe v. Wade (1973). </li></ul><ul><li>Website privacy policies. What about private information on the internet? </li></ul><ul><li>What about USA PATRIOT ACT (2001)? </li></ul><ul><li>HIPAA (1996) (healthcare privacy). </li></ul>
  30. 30. Appendix to Chapter 1 <ul><li>Finding Statutory Law. </li></ul><ul><ul><li>United States Code (USC). </li></ul></ul><ul><ul><li>State Statutes. </li></ul></ul><ul><li>Finding Administrative Law. </li></ul><ul><ul><li>Code of Federal Regulations (CFR). </li></ul></ul><ul><li>Finding Case Law (Case Citations). </li></ul>
  31. 31. Exhibit 1A-1
  32. 32. Appendix <ul><li>Reading & Understanding Case Law </li></ul><ul><ul><li>Legal cases are identified by a “legal citation” (or a “cite”) as the example below: </li></ul></ul><ul><li>Nunez v. Carabba’s Italian Grill, Inc. , 448 Mass. 170, 859 N.E.2d 801 (2007). </li></ul>Title: First Party is Plaintiff, second party is Defendant. The parties are either italicized or underlined .
  33. 33. Appendix <ul><li>Reading & Understanding Case Law </li></ul><ul><ul><li>Legal cases are identified by a “legal citation” (or a “cite”) as the example below: </li></ul></ul><ul><li>Nunez v. Carabba’s Italian Grill, Inc ., 448 Mass. 170, 859 N.E.2d 801 (2007). </li></ul>This is a 2007 State Supreme Court Case found in volume 448, page 170 of the Massachussets Reports, OR volume 859, page 801 of the NorthEastern Reporter 2 nd .

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