mgt 330

Force Majeure Clause

Force Majeure Clause

a clause in a contract in which the parties specify certain events that will excuse nonperformance

act of state

A doctrine that provides that the judicial branch of one country will not examine the validity of public acts committed by a recognized foreign government within its own territory.

Foreign Corrupt Practices Act

U.S. law regulating behavior regarding the conduct of international business in the taking of bribes and other unethical actions.

Foreign Sovereign Immunities Act

a U.S. statute that provides that American courts generally cannot entertain suits against foreign governments

OPIC

Overseas Private Investment Corporation

sovereign immunity

the principle that a sovereign government cannot be taken to court unless it agrees to be sued

Expropriation

implies legal process and just compensation for goods or property taken for public use

comity

courtesy; civility

A spirit of comity should exist among nations.

CISG

United Nations Convention on Contracts for the International Sale of Goods

Forms of Business Organization

sole proprietorship, partnership, corporation

limited partnership

A partnership with one or more general partners and one or more limited partners.

LLC

A limited liability company (LLC) is a corporate structure whereby the members of the company cannot be held personally liable for the company's debts or liabilities.

LLP

Limited liability partnerships, are partnerships for legal and income tax purposes, liable only for commercial debt and their own malpractice, not partners

Corporate Veil

The personal liability shield; the corporate protection that entitles shareholders, directors, and officers to limited liability; can be pierced for improper conduct of business or fraud.

Corporate Opportunity Doctrine

A business proposition or investment opportunity that a corporation would have an interest in pursuing; precludes directors from taking a profit opportunity when the corporation would have an interest.

Business Judgment Rule (BJR)

rule that allows management immunity from liability for corporate acts where there is a reasonable indication that the acts were made in good faith with due care

deceptive advertising

a representation, omission, act, or practice in an advertisement that is likely to mislead consumers acting reasonably under the circumstances

FTC (Federal Trade Commission)

. Protects consumers from misleading and fraudulent advertising. Reviews advertising claims. Can order a company to change their ad

NC Theft Identity Protection Act

The Act requires businesses, charities and government to notify individuals if a security breach has compromised any personal information and placed them at risk of identity theft.

Landowner Liability

encourages landowners to make land and water areas available to the public for educational and recreational purposes by limiting the owners liability toward persons entering thereon for such purposes.

Attractive Nuisance

A dangerous place, condition, or object that is particularly attractive to children

CERCLA (Comprehensive Environmental Response, Compensation, and Liability Act)

It was passed in 1980 in response to some alarming and decidedly unacceptable hazardous waste practices and management going on in the 1970s.

Superfund

A fund created by Congress in 1980 to clean up hazardous waste sites. Money for the fund comes from taxing chemical products.

Elements of Negligence

duty, breach, causation, damages

Elements of Defenses

Mental Disorder (Insanity)

Automatism.

Intoxication.

Mistake Of Fact.

Necessity/Lesser harm.

antitrust laws

laws aimed at eliminating collusion and promoting competition among firms

covenant not to compete

A contractual promise of one party to refrain from conducting business similar to that of another party for a certain period of time and within a specified geographical area.

Robinson-Patman Act (1936)

makes it unlawful to discriminate in prices charged to different purchasers of the same product, where the effect may substantially lessen competition or help to create a monopoly

Rule of Reason Violation

An action that breaches antitrust laws only if it has an anticompetitive impact

per se violation

A restraint of trade that is so anticompetitive that it is deemed inherently (per se) illegal.

Sherman Act of 1890

First federal action against monopolies

purposeful act violations

Clayton Antitrust Act (1914)

act designed to strengthen the Sherman Antitrust Act of 1890; certain activities previously committed by big businesses, such as not allowing unions in factories and not allowing strikes, were declared illegal.

Clayton Act Violations

Price Discrimination

Exclusionary Practices

Tying Arrangements

Mergers

Foreign Corrupt Practices Act (1977)

A law that makes it a crime for U.S. corporations to bribe an official of a foreign government or political party to obtain or retain business in a foreign country. an amendment to 1934 Act

1933 Act

Act requiring registration before issuance of securities through interstate commerce

1934 SEC Act

requires public companies to make regular filings with the SEC

Rule 10b-5

SEC rule prohibiting fraud in relation to the sale of securities.

Rule 16

The short-swing profit rules an SEC regulation that prevents insiders in a publicly traded company from reaping short-term profits.

insider trading

an unethical activity in which insiders use private company information to further their own fortunes or those of their family and friends

Sarbanes-Oxley Act (SOX)

Requires companies to review internal control and take responsibility for the accuracy and completeness of their financial reports.

Securities and Exchange Commission (SEC)

The agency of the U.S. government that oversees U.S. financial markets and accounting standard-setting bodies.

Elements of Security

(1) investment of money,

(2) common enterprise,

(3) expectation of profits,

(4) solely from the efforts of others

Mission of SEC

protect investors, maintain fair, orderly, and efficient markets, and facilitate capital formation

1933 violations (section 11)

Registration with material misstatement or omission

1933 violations (section 12)

Section 12- No Registration filed or false statements in prospectus or sold too early

1933 limited advertising allowed

Red Herring, Tombstone Ad

Securities Exchange Act of 1934- applies to?

companies with $10M in assets and 500 or more shareholders

section 10(b) protects what?

Insider Trading are Anti-Fraud

Misappropriation Theory

the legal doctrine supported by the SEC and the courts that any person who shares nonpublic information with another party or who trades on the information violates the securities laws if that information was intended to be kept confidential

Proxy Statement

a statement transferring the votes of a stockholder to another party

Punishment for 1934 Act Violations

individuals- 20 years prison and/or $5M fine, and partnership/ corporation fine up to $25M, under SOX 25 years for willful violation + fine

Horizontal Restraint of Sherman act

between competitors, Price fixing, per se

Vertical Restraints of Sherman act

between levels in distribution process

Enforcement of Antitrust Laws

DOJ, FTC, Private Parties

Trespasser

duty of reasonable care owed when trespasser's presence is known or landowner has reason to know of trespasser's presence

Licensees

non-trespassers- come onto the land with or without invitation, but, are not connected with business or the property

Invitee

non-trespasser- those entering upon land, usually invited, for business purpose or for potential monetary benefit to owner

Dram Shop Acts

A state statute that imposes liability on the owners of bars and taverns, as well as those who serve alcoholic drinks to the public, for injuries resulting from accidents caused by intoxicated persons when the sellers or servers of alcoholic drinks contributed to the intoxication.