Untitled Flashcards Set

Business Judgment Rule

Protects corporate officers and directors from liability for decisions made in good faith, even if they result in losses.

Sole Proprietorship (SP)

A business owned and operated by one individual; simple to establish but lacks liability protection.

Partnership

A business owned by two or more people, sharing profits, losses, and management responsibilities.

Limited Liability Company (LLC)

Combines the liability protection of a corporation with the tax benefits of a partnership.

Corporation

A separate legal entity owned by shareholders, offering strong liability protection but subject to double taxation.

The SEC

The U.S. Securities and Exchange Commission, which regulates securities markets and protects investors.

Securities Exchange Acts of 1933 and 1934

The 1933 Act regulates initial securities offerings (IPOs), while the 1934 Act governs securities trading and establishes the SEC.

IPO

Initial Public Offering; the first sale of stock by a company to the public.

Registration Statement

A detailed disclosure document filed with the SEC for an IPO.

Prospectus

A condensed version of the registration statement provided to investors.

Insider Trading

Buying or selling securities based on material non-public information.

Misappropriation Theory

Holds individuals liable for insider trading if they misappropriate confidential information.

U.S. v. Bhagat

A landmark insider trading case illustrating violations of securities laws.

Material Non-Public Information

Information not yet released to the public that could affect a company’s stock value.

Agency Law

Governs the relationship between principals and agents, where the agent acts on behalf of the principal.

Principal and Agent Roles/Duties

Principals owe compensation and reimbursement; agents owe loyalty, obedience, and care.

Respondeat Superior

Employers are liable for employees' wrongful acts committed within the scope of employment.

Employer-Employee (Master-Servant)

Traditional relationship where the employer controls the work details of the employee.

Express Agency

Formed by explicit agreement.

Implied Agency

Formed by actions or circumstances.

Apparent Agency

Arises when a principal’s actions lead others to believe an agency exists.

Agency by Ratification

Occurs when a principal approves an unauthorized action.

Power of Attorney

A legal document authorizing someone to act on another’s behalf.

Liability on Contracts

Principals are liable for contracts made by agents depending on disclosure level (fully, partially, or undisclosed).

Defenses to Vicarious Liability

Employers may claim acts were outside the scope of employment or performed by independent contractors.

Negligence/Intentional Torts

Employers may be liable for employees’ negligent acts; intentional torts often require additional factors.

Fraud

Intentional deceit; can be innocent if misrepresentation wasn’t deliberate.

Independent Contractors

Workers hired for specific tasks; generally not subject to employer’s liability.

Discrimination in Employment

Unfair treatment based on protected classes; includes disparate-treatment (intentional) and disparate-impact (neutral policies causing discrimination).

Protected Classes

Groups protected under anti-discrimination laws (e.g., race, color, gender, religion).

Lilly Ledbetter Fair Pay Act

Extends the timeframe for filing pay discrimination claims.

EEOC

Equal Employment Opportunity Commission; enforces federal anti-discrimination laws.

Sexual Harassment

Includes quid pro quo (job benefits for sexual favors) and hostile work environment (intimidating or offensive conditions).

BFOQ

Bona Fide Occupational Qualification; allows discrimination if essential for job duties.

ERISA

Employee Retirement Income Security Act; sets standards for retirement and health benefit plans.

FLSA 1938

Fair Labor Standards Act; establishes minimum wage, overtime pay, and child labor rules.

Social Security

Federal program providing retirement, disability, and survivor benefits.

FMLA

Family and Medical Leave Act; grants eligible employees up to 12 weeks of unpaid leave.

OSHA

Occupational Safety and Health Administration; ensures workplace safety and health.

Title VII of the Civil Rights Act 1964

Prohibits employment discrimination based on race, color, religion, sex, or national origin.

Affirmative Action

Policies promoting opportunities for historically disadvantaged groups.

COBRA

Consolidated Omnibus Budget Reconciliation Act; allows continued health insurance after leaving employment.

FUTA

Federal Unemployment Tax Act; funds unemployment benefits.

Finders of Lost Property

Defines ownership rights based on property’s status.

Bailments

A relationship where personal property is entrusted to another for safekeeping.

Gifting

The voluntary transfer of property without consideration.

Land Ownership

Includes surface, subsurface (mineral rights), and air rights.

Fixtures

Items attached to land or buildings, considered part of the property.

Fee Simple Absolute

Full ownership with the right to transfer, sell, or devise property.

Life Estate

Ownership limited to the duration of a person’s life.

Fee Simple Defeasible

Ownership subject to conditions or events.

Co-Ownership Types

Includes joint tenancy (with survivorship), tenancy by the entirety (for married couples), tenancy in common (shared ownership without survivorship).

Cooperatives/Condominiums

Types of property ownership; cooperative owners hold shares, condo owners own individual units.

Community Property

Equal ownership of property acquired during marriage.

Conveyance/Deeds

Transfer of property rights via legal documents.

Statute of Frauds

Requires certain contracts, including real estate, to be in writing.

Non-Possessory Interests in Land

Rights to use land without owning it (e.g., easements).

Leasehold Estate

Tenant’s rights to use property for a term.

Adverse Possession

Acquiring ownership by openly occupying land for a statutory period.

Eminent Domain

Government’s power to take private property for public use.

Takings Clause

Requires just compensation for property taken by the government.

Kelo v. City of New London

Supreme Court case broadening the scope of eminent domain.

Recording Statutes

Laws requiring property transactions to be recorded.

Transferring Property at Death

Methods include wills, intestacy laws, and trusts.