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THE LEGAL
       ENVIRONMENT
Chad Penny, Kimberly Schaub. Courtney Spall,
               Kaya Comrie
COMMON LAW

Body of law that comes from decisions handed down by Judiciary
part of our government through court system

Also known as unwritten law

Uses what is called Precedents, which are decisions decided in
previous cases

Created by decisions made in trial courts, appellate courts, and
special courts

Lower courts must abide by precedents made by higher courts
STATUTORY LAW

Actual written law that is made up of Federal and State
constitutions, legislative enactments, treaties of the Federal
Government and Ordinances

Although written where anyone can read, it’s usually determined
by courts systems.

Law created by legislatures
ADMINISTRATIVE
                        AGENCIES
Federal or State institutions and other government organizations
created by Congress or state legislators with delegated power to create
rules and regulations within their given area of authority

Legislative bodies can create administrative agencies, as well as
terminate them

Agencies can pass rules and regulations within it’s area of authority,
conduct investigations in rule violations, as well as hold hearings

Important agencies include the Securities and Exchange Commission
(SEC), Federal Reserve Board, as well as the Equal Employment
Opportunity Commission
ANTITRUST
                       LEGISLATION
Was created in 1890 by Congress.

Sherman Antitrust Act was passed to alleviate any chance of large
companies becoming so big that smaller companies would be
crushed

Forbids: Contracts, combinations, or conspiracies in restraint of
trade, as well as the creation of Monopolies

Other laws enacted: Clayton Act of 1914. Federal Trade
Commission Act of 1914, Robinson-Patman Act of 1936
NEXT
TORT LAW

Any wrong doing against another person, property, or reputation

Often non-criminal in nature I.E. Tobacco lawsuits

Examples of Torts:

Negligence

Product Liability

Strict Product Liability
DEREGULATION

Government withdrawal of certain laws and regulations that seem
to hinder competition

Example: Airline Industry

Banking Industry downfall of Deregulation

Government takeover of Fannie May and Freddy Mac/Bailout of
AIG
COPYRIGHTS

Protects a creator's rights to materials such as books, articles,
photos, paintings and cartoons.

Filed in Library of Congress and lasts lifetime + seventy years

Can be passed to heir

JK Rowling lawsuit
TRADEMARKS

Legally protected name, symbol, or design that identifies the
goods or services of one seller and distinguishes them from those
of competitors.

Belongs to owner forever as long as it’s properly registered and
renewed every ten years

Protected against infringement

Some well known trademarks include: AFLAC duck, Mickey
Mouse, McDonald’s arches, Nike swoosh
BANKRUPTCY

The legal process by which a person, business, or gov't entity
unable to meet financial obligations is relieved of these
obligations by a court that divides any assets among creditors,
allowing creditors to get at least part of their money and freeing
the debtor to begin anew.

The US Constitution gives congress the power to establish
bankruptcy laws, and legislation has existed since the 1890's.
BANKRUPTCY CON’T

Different types of bankruptcy:

Chapter 7: Straight bankruptcy in which all assets are divided
among creditors after exemptions

Chapter 11: Allows a firm to reorganize and continue operation
after paying only a limited portion of it’s debts. EX: AA

Chapter 13: Allows individuals to pay their creditors over an
extended period of time
NEXT
CONTRACT LAW

Contract: Legally enforceable agreement between two or more
parties

Contract Law: Specifies what constitutes a legally enforceable
agreement

Consideration: Something of value someone is willing to give up
in order to enter into contract with someone else
CONTRACT LAW
                       CON’T
What makes a contract binding?

1. Oral or written offer is made
2. Mutual acceptance/agreement of offer and cannot be forced
   upon
3. Both parties give consideration/collaboration. Both parties
   must hold up their end of contract
4. Both parties sober and conscience of details of contract
5. Must be legal and not contain any stolen goods
6. Contract is in proper form
BREACH OF
                        CONTRACT
Happens when one party fails to uphold their end of contract

Damages: Agreed settlement awarded by the court to person
affected by breach of contract

If breech happens, the following can occur:

1. Specific Performance
2. Payment of Damages
3. Discharge of Obligation
LAWS TO PROTECT
                     CONSUMERS
Consumerism: A social movement that seeks to increase and
strengthen the rights and powers of buyers in relation to the
sellers

Fair Packaging and Labeling Act of 1966: Makes deceptive
packaging or labeling of a package illegal

Child Protection Act of 1966: Removes unsafe toys and allows
the FDA to pull dangerous products from the market
TAX LAWS

Taxes: How all forms of government raises money

Governments have used taxes primarily as a source of funding
for their operations and programs

Sin Tax: Used to raise prices on certain items

Tax Credits: An amount firms can deduct from their tax bills
TAX LAWS CON’T

Income Tax: Income received by businesses and individuals

Property Taxes: Paid on real and personal property

Sales Taxes: Paid on merchandise sold at retail level

Excise Tax: Paid on Select handful of items
PATENTS

A document that gives inventors exclusive rights to their
inventions for twenty years

Approval two to four years

USPTO

Selling and license use of patents

International companies
NEXT
UCC

Uniform Commercial Code

Laws that cover any and all sales transactions

Adopted by all fifty states

Has eleven articles which contain laws covering sales
WARRANTIES

Article two of the UCC

Four Types:

Warranty- guarantees that the product sold will be acceptable
for the purpose for which the buyer intends to use it.

Express warranties- are specific representations by the seller
that buyers rely on regarding the goods they purchase
WARRANTIES CON’T



Implied warranties- are legally imposed on the seller, who implies
that a product will conform to the customary standards of the
trade or industry in which it competes.

Full/limited warranty-full warranty requires a seller to replace or
repair a whereas a limited warranty typically limits the defects or
mechanical problems the seller cover.
NEGOTIABLE
                        INSTRUMENTS
Negotiable instruments- forms of commercial paper (such as checks)
that are transferable among business and individuals; they represent a
promise to pay a specified amount.

Article 3 of the UCC requires negotiable instruments to follow four
conditions
-they must be written and signed by the maker or drawer
-they must be made payable on demand or at a certain time
-they must be payable to the bearer or to specific order
-they must contain an unconditional promise to pay a specified amount
of money.
END

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Legal Environment

  • 1. THE LEGAL ENVIRONMENT Chad Penny, Kimberly Schaub. Courtney Spall, Kaya Comrie
  • 2. COMMON LAW Body of law that comes from decisions handed down by Judiciary part of our government through court system Also known as unwritten law Uses what is called Precedents, which are decisions decided in previous cases Created by decisions made in trial courts, appellate courts, and special courts Lower courts must abide by precedents made by higher courts
  • 3. STATUTORY LAW Actual written law that is made up of Federal and State constitutions, legislative enactments, treaties of the Federal Government and Ordinances Although written where anyone can read, it’s usually determined by courts systems. Law created by legislatures
  • 4. ADMINISTRATIVE AGENCIES Federal or State institutions and other government organizations created by Congress or state legislators with delegated power to create rules and regulations within their given area of authority Legislative bodies can create administrative agencies, as well as terminate them Agencies can pass rules and regulations within it’s area of authority, conduct investigations in rule violations, as well as hold hearings Important agencies include the Securities and Exchange Commission (SEC), Federal Reserve Board, as well as the Equal Employment Opportunity Commission
  • 5. ANTITRUST LEGISLATION Was created in 1890 by Congress. Sherman Antitrust Act was passed to alleviate any chance of large companies becoming so big that smaller companies would be crushed Forbids: Contracts, combinations, or conspiracies in restraint of trade, as well as the creation of Monopolies Other laws enacted: Clayton Act of 1914. Federal Trade Commission Act of 1914, Robinson-Patman Act of 1936
  • 7. TORT LAW Any wrong doing against another person, property, or reputation Often non-criminal in nature I.E. Tobacco lawsuits Examples of Torts: Negligence Product Liability Strict Product Liability
  • 8. DEREGULATION Government withdrawal of certain laws and regulations that seem to hinder competition Example: Airline Industry Banking Industry downfall of Deregulation Government takeover of Fannie May and Freddy Mac/Bailout of AIG
  • 9. COPYRIGHTS Protects a creator's rights to materials such as books, articles, photos, paintings and cartoons. Filed in Library of Congress and lasts lifetime + seventy years Can be passed to heir JK Rowling lawsuit
  • 10. TRADEMARKS Legally protected name, symbol, or design that identifies the goods or services of one seller and distinguishes them from those of competitors. Belongs to owner forever as long as it’s properly registered and renewed every ten years Protected against infringement Some well known trademarks include: AFLAC duck, Mickey Mouse, McDonald’s arches, Nike swoosh
  • 11. BANKRUPTCY The legal process by which a person, business, or gov't entity unable to meet financial obligations is relieved of these obligations by a court that divides any assets among creditors, allowing creditors to get at least part of their money and freeing the debtor to begin anew. The US Constitution gives congress the power to establish bankruptcy laws, and legislation has existed since the 1890's.
  • 12. BANKRUPTCY CON’T Different types of bankruptcy: Chapter 7: Straight bankruptcy in which all assets are divided among creditors after exemptions Chapter 11: Allows a firm to reorganize and continue operation after paying only a limited portion of it’s debts. EX: AA Chapter 13: Allows individuals to pay their creditors over an extended period of time
  • 13. NEXT
  • 14. CONTRACT LAW Contract: Legally enforceable agreement between two or more parties Contract Law: Specifies what constitutes a legally enforceable agreement Consideration: Something of value someone is willing to give up in order to enter into contract with someone else
  • 15. CONTRACT LAW CON’T What makes a contract binding? 1. Oral or written offer is made 2. Mutual acceptance/agreement of offer and cannot be forced upon 3. Both parties give consideration/collaboration. Both parties must hold up their end of contract 4. Both parties sober and conscience of details of contract 5. Must be legal and not contain any stolen goods 6. Contract is in proper form
  • 16. BREACH OF CONTRACT Happens when one party fails to uphold their end of contract Damages: Agreed settlement awarded by the court to person affected by breach of contract If breech happens, the following can occur: 1. Specific Performance 2. Payment of Damages 3. Discharge of Obligation
  • 17. LAWS TO PROTECT CONSUMERS Consumerism: A social movement that seeks to increase and strengthen the rights and powers of buyers in relation to the sellers Fair Packaging and Labeling Act of 1966: Makes deceptive packaging or labeling of a package illegal Child Protection Act of 1966: Removes unsafe toys and allows the FDA to pull dangerous products from the market
  • 18. TAX LAWS Taxes: How all forms of government raises money Governments have used taxes primarily as a source of funding for their operations and programs Sin Tax: Used to raise prices on certain items Tax Credits: An amount firms can deduct from their tax bills
  • 19. TAX LAWS CON’T Income Tax: Income received by businesses and individuals Property Taxes: Paid on real and personal property Sales Taxes: Paid on merchandise sold at retail level Excise Tax: Paid on Select handful of items
  • 20. PATENTS A document that gives inventors exclusive rights to their inventions for twenty years Approval two to four years USPTO Selling and license use of patents International companies
  • 21. NEXT
  • 22. UCC Uniform Commercial Code Laws that cover any and all sales transactions Adopted by all fifty states Has eleven articles which contain laws covering sales
  • 23. WARRANTIES Article two of the UCC Four Types: Warranty- guarantees that the product sold will be acceptable for the purpose for which the buyer intends to use it. Express warranties- are specific representations by the seller that buyers rely on regarding the goods they purchase
  • 24. WARRANTIES CON’T Implied warranties- are legally imposed on the seller, who implies that a product will conform to the customary standards of the trade or industry in which it competes. Full/limited warranty-full warranty requires a seller to replace or repair a whereas a limited warranty typically limits the defects or mechanical problems the seller cover.
  • 25. NEGOTIABLE INSTRUMENTS Negotiable instruments- forms of commercial paper (such as checks) that are transferable among business and individuals; they represent a promise to pay a specified amount. Article 3 of the UCC requires negotiable instruments to follow four conditions -they must be written and signed by the maker or drawer -they must be made payable on demand or at a certain time -they must be payable to the bearer or to specific order -they must contain an unconditional promise to pay a specified amount of money.
  • 26. END