Chad Penny, Kimberly Schaub. Courtney Spall, Kaya Comrie

THE LEGAL ENVIRONMENT

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

COMMON 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

STATUTORY LAW

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

ADMINISTRATIVE AGENCIES

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

ANTITRUST LEGISLATION

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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

TORT LAW

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

DEREGULATION

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

COPYRIGHTS

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

TRADEMARKS

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

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

BANKRUPTCY CON’T

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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

What makes a contract binding?

1. Oral or written offer is made2. Mutual acceptance/agreement of offer and cannot

be forced upon3. Both parties give consideration/collaboration. Both

parties must hold up their end of contract4. Both parties sober and conscience of details of

contract5. Must be legal and not contain any stolen goods6. Contract is in proper form

CONTRACT LAW CON’T

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 Performance2. Payment of Damages3. Discharge of Obligation

BREACH OF CONTRACT

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

LAWS TO PROTECT

CONSUMERS

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

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

TAX LAWS CON’T

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

PATENTS

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Uniform Commercial Code

Laws that cover any and all sales transactions

Adopted by all fifty states

Has eleven articles which contain laws covering sales

UCC

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

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. 

WARRANTIES CON’T

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. 

NEGOTIABLE INSTRUMENTS

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