Business Law and Ethics Final LEB 320F

Common Law

Legal ideas that originate in court opinions

Statutory Law

Legal rules created by bodies of elected representatives

Statute

When the Congress or a state legislature creates a new law

Civil lawsuit

People seeking compensation from others for wrongdoing against them

Criminal Lawsuit

The government prosecuting someone for breaking the law

District Courts

First stop of every lawsuit, where lawyers file pleadings, select juries, place witnesses on the stand for examination. Judges rule on motions and objections, give juries instructions, and enter judgments. Juries listen to evidence, deliberate, and return verdicts.

U.S. Courts of Appeal or circuit courts

If parties to a lawsuit are dissatisfied with how a trial court handled a case, they can take an appeal here. Where a panel of judges reviews the case for errors. Intermediate appellate courts

Supreme Court

If a party is unhappy with an intermediate court's actions, it can ask a this court to give a final review to the case.

Federal Laws

Laws that come from the government of the United States

State Laws

Laws created by individual states

Jurisdiction

A court's power or authority over a case

Subject matter jurisdiction

A court's power to hear a particular type or category of case. Some courts have been created to decide only one particular kind of case.

Federal courts only have subject matter jurisdiction over 2 major types of lawsuits

Federal Question Cases and Diversity of Citizenship Cases

Federal Question Cases

Plaintiffs base their claims on federal laws or statutes. (Ex: Plaintiffs believe they should win their case because of Civil Rights of 1964 or provision to the U.S Constitution)

Diversity of Citizenship Cases

Plaintiff & defendants live in different states and plaintiffs seeks at least $75,000

Federal courts

Courts of limited jurisdiction (limited to the types of cases the Constitution says they can hear)

State courts

Courts of general jurisdiction that have much broader subject matter jurisdiction and can even entertain federal question and diversity cases, with some major exceptions.

Personal jurisdiction

A court's power or authority over the parties involved in a lawsuit. Plaintiffs voluntarily submit themselves to a court's jurisdiction upon filing a lawsuit, so the focus here is always on defendants.

Under what circumstances does a court come to have authority over a defendant?

A court has personal jurisdiction over a defendant if he makes an appearance, or takes a formal step to defend a lawsuit. A defendant may also be served with a summons, or formal notice of a lawsuit.

Long arm statutes

This statue can establish personal jurisdiction if a defendant has had minimum contacts, or some reasonable degree of interaction, with a state

When can a lawsuit proceed without a court having personal jurisdiction over a defendant?

When a court has in rem jurisdiction over property located in the same state that a court sits, it can act as a substitute for personal jurisdiction if the property is the focus of the claim

True \n Any case that arises out of a federal statute, such as the Americans with disabilities act, can be brought in a Federal District court.

T/F A claim arising out of the Americans with disabilities act, which is a Federal statute, would be a Federal Question case and, therefore, be within a federal district court's jurisdiction.

Courts of limited jurisdiction

Includes justice of the peace courts, municipal courts, traffic courts, probate courts, and domestic relations courts.

False \n An effective manager will attempt to alter political situations and regulations to aid their company.

T/F An effective manager of a corporation should not attempt to alter political situations.

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True \n Criminal cases require that the case be proved "beyond a reasonable doubt." Civil cases vary, but generally require proof by a "preponderance of evidence."

T/F For a criminal trial, the government must prove their case "beyond a reasonable doubt" in order to secure a guilty verdict

True \n In Rem jurisdiction, which can be established by having property within the jurisdiction of the court, can satisfy jurisdictional requirements for a case.

T/F Personal jurisdiction over certain cases, such as bankruptcy cases, can be established simply by having property relevant to the suit within the jurisdiction of the court.

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True \n If a defendant has continuous and systematic contacts with a jurisdiction, it has general jurisdiction over the defendant. When a state has general jurisdiction over a party, it has personal jurisdiction over the party.

T/F ACC, a Florida company, sells Zach, a Louisiana citizen, a car in Minnesota. The car breaks down while Zach is driving in Oklahoma. Florida has continuous and systematic contacts with Oklahoma because it manufactures products in Oklahoma. Oklahoma has general jurisdiction over ACC and, therefore, has personal jurisdiction over ACC.

False \n The Supreme Court gets to choose which cases it hears. Generally, only cases granted writ of certiorari are heard by the Supreme Court

T/F All cases before a federal Circuit court have the right to be heard on appeal.

False \n Simply having a website, "without requiring some level of 'interactivity' between the defendant and consumers in the forum state" is not enough to establish general jursidiction in a given jurisdiction.

T/F A website accessible in a jurisdiction is enough to establish general jurisdiction.

True \n Although there are many exceptions, a third party generally has no legal obligation to assist a third party.

T/F Individuals are generally not required by law to help a third party when they request aid.

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False \n Corporations are considered to be citizens of both the state in which they are incorporated in and where their principle place of business is. Because USC's principle place of business is in Texas and Johnny is a citizen of Texas, diversity jurisdiction cannot be established.

T/F Johnny, a citizen of Texas, sues USC, a corporation incorporated in California with a principle place of business in Texas, for $2.5 million on a claim arising from state law. This suit can be brought in Federal Court.

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False \n Under Rules of Civil Procedure 4(k)(2), if a foreign defendant has a significant amount of contact with the United states, but personal jurisdiction cannot be established with any individual state, the foreign defendant can still be found to have personal jurisdiction.

T/F Magnus, a citizen of Sweden, has a significant number of contacts with the United States as a whole to establish personal jurisdiction, but not enough contacts with an individual state to establish jurisdiction. An American court cannot establish personal jurisdiction over Magnus.

False \n Most jurisdictions consider any defense claiming lack of personal jurisdiction to be waived when a party makes an appearance before the court.

T/F A party may make a special appearance at any point in a trial.

False \n Some appeals from specialized federal courts go to federal district courts for their appeals, while others go to Circuit Courts.

T/F Appeals from specialized federal courts, such as bankruptcy courts always go to the Federal Court of Appeals.

Which of the following are factors in determining if a duty is owed to assist a third party?

Foreseeability of harm to the plaintiff, extent of burden to the defendant, consequences to the community of imposing a duty to exercise care with resulting liability for breach, the degree of certainty that the plaintiff suffered injury, the closeness of connection between the defendant's conduct and the injury suffered, the moral blame attached to the defendant's conduct, and the availability, cost, and prevalence of insurance for the risk involved.

Summary Judgement

A trial judge deciding a case as a matter of law because there is "no genuine issue of material fact." A judge may decide the outcome of a case without allowing the case to go before a jury.

The case is remanded to the lower court with instructions on what the lower court erred on and how to properly try the case.

What happens when an appellate court finds that a lower court judge erred in granting summary judgment?

California \n \n If there is a provision that all litigation regarding the contract will be brought in a specific state, it should be brought in that state as long as there is a passing connection to the parties or to the transaction with the state.

A contract between a Texas corporation and a California corporation, signed in New York contains a provision that all litigation regarding the contract will be performed in California. What state's law should be applied to the litigation?

Filing of the pleadings

The first significant pre-trial event

A complaint

Filed by a plaintiff and amounts to a list of allegations. Plaintiffs submit a list of factual statements that, if proven with evidence, might show a defendant guilty. Also tends to make a request for damages or some other remedy.

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When defendants receive a complaint they can

File a motion to dismiss, File an answer or Nothing/Default judgment

File a motion to dismiss

A court will grant this motion if it agrees that even if everything in the complaint is proven, there will still be no legal basis for a recovery by the plaintiff (Ashcroft case)

File an answer

A defendant admits or denies each item in the plaintiff's complaint, and also sometimes raises defenses that may be asserted at trial.

Nothing/Default judgment

Defendants fail to make a timely response of any kind. This can result in a judge entering a ___________in favor of the plaintiff. The legal effect is that everything in the complaint is accepted by a court as established or proven, and a defendant loses without having a chance to make a defense in court.

Discovery

Second pre-trail phase. Lawyers representing each side in a lawsuit have expanded powers to obtain information that may be relevant to the case. Commonly used tools for information gathering include depositions, interrogatories, and requests for production of documents.

Depositions

Allow attorneys to question witnesses under oath before a trial begins.

Interrogatories

Allow lawyers to demand answers to written questions.

Requests for production of documents

Allow lawyers to gather emails, business records, and the like.

Voir dire

Lawyers on both sides of a case have a chance to ask questions of prospective jurors

A challenge for cause

An attorney tries to convince a judge that a prospective juror will likely not be fair and impartial.

Peremptory challenges

Lawyers can send a limited number of prospective jurors home without stating any reason in particular

Burden of proof

Plaintiff must demonstrate that their claims are true by presenting evidence. A plaintiff might back up claims by having eyewitnesses to an accident testify in court by introducing documents like contracts, wills, or medical records or by any number of methods

Civil Lawsuit Burden of proof

Plaintiffs is to prove their case by a preponderance of the evidence, or to a "more likely than not" standard. A plaintiff can win without having an overwhelmingly convincing case. Great evidence is better, but merely good evidence is often sufficient. So long as a jury is 51% convinced that a plaintiff's allegations are true, a plaintiff has met this

Writ of execution

When a plaintiff encounters a slow-to-pay defendant, this allows a sheriff to seize a defendant's property and sell it at auction to raise some or all of the money that the defendant owes.

Alternative dispute resolution (ADR)

Methods of settling disputes outside of a courtroom. Negotiated settlement, Arbitration, Mediation, Summary Jury Trial, Minitrial

**Negotiated settlement**

In many cases, a dispute ends without a trial because the parties communicate and agree to a ___________.

Arbitration

Two parties sign a contract that gives one or more arbitrator the power to resolve a dispute. They then present evidence to the arbitrator, who makes a decision. Agreement can be signed after a dispute arises or before there is any problem to begin with. Much faster and significantly less expensive than a trial. On the negative side, there are no appellate arbitrators. These decisions tend to be final.

Mediation

Have no power to decide cases. They can act as a neutral person in a dispute and help the two sides have a civil discussion about how to settle a case.

Summary Jury Trial

A jury is selected in the normal way, and they view a presentation of evidence in a real courtroom in what they believe is a real case. Before trials, it is often true that both sides expect to win. But after a jury in a _________ returns its verdict, one side quickly sees that it is vulnerable. Cases tend to settle shortly thereafter.

Minitrial

In this type of ADR, corporate executives view an abbreviated presentation of evidence, and then directly begin settlement negotiations. Sometimes, executives who get a look at what a jury would see in a future trial become more likely to want to settle a case

Statutory interpretation

Court objective is not to interpret a statute in the way the judges think it should have been written but, instead, in the way the judges think that the legislature would have wanted it applied.

Ejusdem generis and expression uniusest exclusion alterius

Two common rules of grammar often used by the courts to interpret legislative intent from the words of the statute and they are explained in the text.

True \n Because the adversarial system requires that the lawyers do the majority of the investigation and research, it tends to cost more for the private sector. The inquisitorial system requires much more out of the judges and, therefore, costs more for the public sector.

T/F The adversarial judicial system tends to put more cost in the private sector while the inquisitorial system tends to put more cost in the public sector.

T/F The adversarial judicial system tends to put more cost in the private sector while the inquisitorial system tends to put more cost in the public sector.

A legal system where the court or a part of the court is actively involved in investigating the facts of the case

Adversarial system

A legal system used in the common law countries where two advocates represent their parties' case or position before an impartial person or group of people, usually a jury or judge, who attempt to determine the truth and pass judgment accordingly

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False \n If a judge does not agree with the majority of the case, he can write a concurrence if he disagrees with the reasoning and agrees with the outcome, or a dissent if he disagrees with the outcome.

T/F All judges in a panel for a circuit court must agree on the outcome of the case and the reasoning used to justify the outcome.

False \n Losing a counterclaim does not necessarily bar a plaintiff from winning their original suit because it is possible for the counterclaim to be based on a separate cause of action. Because of this, a plaintiff may win their claim and a defendant may also win their counterclaim.

T/F If a defendant wins a counterclaim, the plaintiff cannot win their suit.

A court does not have to follow the precedent from a higher court if the higher court is not directly above it. This means that Texas courts do not have to follow Oklahoma precedent, even if it is the Supreme Court of Oklahoma.

T/F Precedent set by other states (such as Oklahoma) is mandatory authority which a Texas state court must follow.

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False \n A deposition is testimony of a witness given under oath. Both parties are generally present during the testimony and have an opportunity to cross-examine the witness

T/F A deposition is a series of questions sent by one party to the other, which much be answered under oath.

False \n A J.N.O.V. or JMOL (judgment as a matter of law) may only be filed following a jury verdict. A motion to dismiss is filed prior to filing an answer.

T/F A party may file for a motion for judgment notwithstanding the verdict (also known as a J.N.O.V.) only prior to filing an answer.

False \n A defendant moving for summary judgment only needs to prove that there is no genuine issue of material fact while a plaintiff must produce evidence strong enough to prove all elements of the claim, the defendant failed to present evidence that creates any doubt about any elements of the claim, and the defendant has failed to present evidence sufficient to create a genuine issue regarding an affirmative defense.

T/F It is generally easier for a plaintiff to win on summary judgment than a defendant.

Judgment notwithstanding the verdict (JNOV)

A type of judgment as a matter of law (JMOL) that is sometimes rendered at the conclusion of a jury trial. The practice whereby the presiding judge in a civil jury trial may overrule the decision of a jury and reverse or amend their verdict.

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True \n The rules of evidence apply whether the judge or the jury is the fact finder in a given case.

T/F The rules of evidence apply even if there is no jury.

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True \n A general charge asks only for a general verdict; that is, it only asks for a guilty or innocent finding and the damages, if relevant. A special charge includes several different questions, such as the percent liability each side may have, if, in cases where the defendant can win by disproving just one of several elements of a cause of action, the jury found a specific element of a cause of action lacking, or other relevant questions.

T/F There are three types of charges to the jury: general, special, or a combination.

Compulsory counterclaim

A claim made by a defendant against a plaintiff that arises from the same transaction or occurrence as the plaintiff's claim

True \n Because Aaron's claim against AJ arises out of the same set of circumstances, it is a compulsory counterclaim. Compulsory counterclaims which are not brought in an answer are generally waived.

T/F \n AJ buys a car from Aaron. The car AJ buys breaks down the first day, so AJ sues Aaron. Because of the car breaking down, AJ has failed to make payments on the car. In most states, Aaron's suit against AJ must be brought as a compulsory counterclaim, or else it he will lose the ability to pursue the claim.

False \n The UCC was made by a non-government entity offered in hopes that all states accept it, in order to increase uniformity for legal issues faced by multi-state corporations. Although most states have adopted it, many states still have variations of many pieces of it.

T/F The UCC is Federal law that applies to all states.

True \n Courts often consider the textual context of a statute when trying to interpret the meaning of the statute prior to considering the circumstantial context of when the statute was passed.

T/F A court will generally consider the textual context of a statute when attempting to determine the meaning of an ambiguous statute, prior to taking into account the circumstantial context of the passing of the statute.

True \n Summary judgment can only be granted against a plaintiff when the defendant successfully shows that there is no genuine issue of material fact, that is, that there is no dispute regarding evidence that may allow for the possibility of the plaintiff to win the suit on that particular claim.

T/F If a plaintiff presents enough evidence to create a "genuine issue of material fact" following discovery, a judge should not grant summary judgment against that party.

False \n Under the rule of interpretation known as expressio unius est exclusio alterius, it is assumed that when there is a list of certain items, the exclusion of others is presumed to be intentional. Therefore, because the FLSA allows for a suit arising from violation of minimum wage laws, overtime regulations, or child labor regulations, it is implied that other issues, such as uncomfortable working conditions, are excluded from being enforced under the act.

T/F \n John was dissatisfied with the work environment he had to endure while working at B12. John had to work in a building where the A/C was never put below 75 degrees. Under the Fair Labor Standards Act (FLSA), a piece of federal legislation outlining certain practices which employers engaged in interstate commerce can and cannot do, an employee has the ability to bring a lawsuit against a company if the company fails to meet certain standards. These standards include a mandatory minimum wage, overtime regulations, and child labor regulations. John would be able to sue under the FLSA.

When can a party appeal

When the judge makes a mistake such as: ruling on a motion, ruling on an objection, or jury directions

Which of the following should an answer always contain?

All answers should contain a denial. If an answer does not contain a denial, the defense is essentially forfeiting the case. Although an answer may contain an affirmative defense or a counterclaim, neither is necessary.

Which of the following is, according to Benjamin Cardozo, a "directive force" which shapes the law?

Philosophy, History, Custom and Social Welfare

Which of the following is a reason a potential juror may be dismissed during voir dire?

A judge excuses a person by granting a challenge for cause made by one of the attorneys. And an attorney uses a peremptory challenge or a strike against the juror.

Which of the following is a reason for the increasing popularity of arbitration?

The parties have more control over the process, the proceeding can be kept private, no expensive pretrial discovery.

Supremacy Clause

In the Constitution makes federal law the supreme law of the land

Cases of express preemption

Congress creates a statute and specifically bans states from creating similar laws.

The doctrine of implied preemption

May also block states from creating valid laws even when Congress does not specifically prohibit such actions.

Discrimination against interstate commerce

Ex: If Texas tried to pass a law that made it illegal to sell oil from Texas to buyers in other states

Unduly burdening interstate commerce

States also cannot pass laws that create significant roadblocks to interstate commerce. (Granholm v. Heald case)

Privileges and Immunities

This clause in Article IV of the Constitution is used to prevent states from discriminating against citizens who live out of state in various ways. Nonresidents must be allowed to travel freely and access the courts, for example.

Strict scrutiny

When laws make distinctions based on race, national origin, or fundamental rights, the courts apply this. It requires that the government show a compelling rationale to justify the law, and in the end, very few laws can pass the test.

Intermediate scrutiny

With this level of scrutiny, governments must successfully argue that their law substantially advances an important government interest. Especially in claims of laws that discriminate based on gender

Substantive due process

The notion that the substance, or content, of laws must be at least minimally fair. Laws that courts view as arbitrary or irrational may be struck down. Over the years, the Supreme Court has used this doctrine to void laws that have capped the number of hours employees may work in a week, banned the sale of contraceptives, and done many other things.

Procedural due process

Requires that the government follow certain steps, or procedures, before it takes life, liberty, or property. If the government seeks to terminate a government worker's job, suspend a student from a public high school, or sentence a criminal to 10 years in prison, it must follow procedural requirements. Broadly speaking, notice and a chance to present a case to a neutral decision maker are the key procedures.

Takings Clause

The government can take your land for a public purpose, even if you don't want to relinquish it. If the government decides that it needs your property for a road extension, then it can take the land with the power of eminent domain. The 5th Amendment's___________ will not allow you to block the seizure, but it will entitle you to just compensation.

To win a conviction in criminal cases, a prosecutor must generally demonstrate beyond a reasonable doubt the following:

1\. A defendant's actions violated a criminal statute. \n 2. The defendant committed the illegal acts beyond a reasonable doubt. Merely thinking of committing a crime is generally insufficient to demonstrate a guilty act, but taking a step towards committing a crime usually counts. \n 3. The defendant intended to violate the law. To some degree, defendants must be shown to have a "guilty mind."

True \n The concept of property is very broad under the Takings Clause. It includes any tangible property and intangible property rights such as those that exist in a company's trade secret information.

T/F The Takings Clause can be applied to allow for the government to take trade secret information from corporations.

False \n If there is a legally imposed duty, a failure to perform may constitute the actus reus of a criminal offense.

T/F In order to be convicted of a criminal offense, an act must be performed.

False \n A corporation can only be held criminally liable for acts performed by an employee if that employee is acting within the scope of his or her authority for the purpose of benefiting the corporation.

T/F A corporation can be held criminally liable for any act of its employees.