Business Law: Contracts, IP, Business Organizations, Administrative Law, and Securities Regulation

Vocabulary flashcards covering core legal concepts across contract formation and interpretation, intellectual property protections, business entity formations, administrative agency processes, and federal securities regulations.

Contract (K)

Promises that are legally enforceable with predictable consequences for performance failures, enabling parties to account for future risks.

Uniform Commercial Code (UCC) Article 2

A statutory body of law adopted by states that governs the sale of goods, defined as tangible, movable items of personal property.

Bilateral Contract

A contract formed by an exchange of a promise for a promise, which courts typically presume in contract disputes.

Unilateral Contract

A contract where the offeror makes a promise seeking performance or action rather than a return promise, and acceptance occurs solely through completing that performance.

Express Contract

A contract in which the parties explicitly discuss and communicate the terms, whether orally, in writing, or through a combination of both.

Implied-in-Fact Contract

A legally binding agreement arising from the conduct of the parties rather than from explicit spoken or written words.

Implied-in-Law (Quasi-Contract)

A legal fiction created by courts allowing enforcement or relief when no actual contract exists, preventing one party from being unjustly enriched at the expense of another.

Void Contract

An agreement that has a fatal validity defect from the outset, such as an illegal subject matter, making it unenforceable by any party.

Voidable Contract

An agreement that is enforceable until a party with a recognized defense (such as a minor or a victim of fraud) elects to disaffirm or void it.

Executed Contract

A contract in which all parties have fully performed their promised obligations.

Executory Contract

A contract in which the promised obligations have not yet been performed by the parties.

Revocation

The act of an offeror retracting or withdrawing an offer before it has been accepted by the offeree.

Counteroffer

A response by an offeree that proposes different terms, which legally terminates the original offer and creates a new one.

Mirror Image Rule

The common law contract doctrine requiring that an acceptance must match the terms of the offer exactly without omitting or adding any terms.

Mailbox Rule

The rule stating that an acceptance of an offer becomes legally effective and binding as soon as it is dispatched or deposited into the postal system, preventing revocation.

Consideration

Something of legal value bargained for and exchanged between contracting parties, requiring both sides to receive a legal benefit or incur a legal detriment.

Promissory Estoppel

An equitable doctrine used when a party justifiably relies on a gratuitous promise to their substantial detriment, allowing a court to enforce the promise to prevent injustice.

Statute of Frauds

A legal rule requiring certain categories of contracts—including agreements for the sale of land, debts of another, contracts not performable within a year, and sales of goods for $500$ or more—to be in writing to be enforceable.

Parol Evidence Rule

A rule prohibiting extrinsic testimony regarding oral agreements or negotiations made prior to or contemporaneous with a final written contract to alter its terms.

Condition Precedent

An event or factual requirement that must take place before a party has an enforceable duty to perform under a contract.

Condition Subsequent

A future event that, if it occurs, excuses or discharges a party from further contractual performance.

Substantial Performance

A level of performance that falls just short of complete execution, entitling the performing party to contract payment minus damages for minor deficiencies.

Material Breach

A severe failure of contractual performance below acceptable standards that excuses the non-breaching party from their obligations under the contract.

Novation

A three-party agreement in which all parties consent to substitute a new party for an existing contracting party, completely discharging the original party's obligations.

Trade Secret

Confidential business knowledge, processes, or customer information that provides economic value from not being generally known and is protected by reasonable secrecy measures.

Misappropriation

The unlawful acquisition or unauthorized disclosure of a trade secret by improper means, excluding independent creation or reverse engineering.

Utility Patent

A patent granting exclusive legal rights for $20$ years for new, non-obvious, and useful processes, machines, articles of manufacture, or compositions of matter.

Design Patent

A patent granting exclusive rights for $15$ years for a new, original, and ornamental design applied to an article of manufacture.

Plant Patent

A patent granting exclusive rights for $20$ years on a new variety of plant that can be reproduced asexually.

Service Mark

A distinctive mark used in advertising, uniforms, or displays to identify and distinguish the source of a service rather than physical goods.

Certification Mark

A mark used by someone other than the producer to certify that goods or services meet defined standards, quality, origin, or characteristics (such as USDA Organic).

Collective Mark

A mark used to indicate membership in an organization, association, union, or cooperative.

Trade Dress

The total visual image, design, shape, or overall packaging of a product or commercial space that identifies its origin to consumers.

Trademark Dilution

The unauthorized use of a mark identical or similar to a famous trademark that reduces the mark's distinctiveness through blurring or tarnishment.

Sole Proprietorship

The simplest and least expensive business form, operated by a single individual who possesses total management control and unlimited personal liability for all business debts.

Partnership

An association of two or more persons carrying on as co-owners of a commercial business for profit, characterized by joint and several unlimited personal liability.

Corporation

An artificial, intangible entity created under state law that provides limited liability to its shareholders and maintains perpetual continuity independent of ownership changes.

Piercing the Corporate Veil

A legal remedy where a court disregards corporate personhood and holds shareholders personally liable for corporate obligations due to improper conduct or comingling of funds.

Limited Partnership

A hybrid business structure consisting of one or more general partners with unlimited liability and managerial authority, and limited partners who act as passive investors with limited liability.

S Corporation

A corporation with $100$ or fewer shareholders that unanimously elects to pass corporate income, losses, and deductions through to shareholders' individual tax returns to avoid double taxation.

Limited Liability Company (LLC)

A non-taxable pass-through business entity whose owners (members) receive limited personal liability along with managerial flexibility without the restrictions of an S corporation.

Apparent Authority

Authority created when a principal's conduct leads a third party to reasonably believe an agent possesses the power to act on the principal's behalf.

Administrative Law Judge (ALJ)

An agency official who presides over administrative hearings, evaluates facts, renders decisions, and possesses judicial immunity from liability for official rulings.

Security

Any financial instrument, stock, bond, or investment contract in which an individual invests money in a common enterprise with a reasonable expectation of profit derived primarily from the efforts of others.

Securities Act of 1933

A federal law regulating the initial public offering and sale of securities by mandating full, accurate disclosure and registration before distribution to investors.

Securities Exchange Act of 1934

A federal statute regulating the secondary trading and transfer of securities, establishing anti-fraud provisions, and creating the Securities and Exchange Commission (SEC).

Insider

Under federal securities law, any person who owns more than $10\%$ of any security class or who trades on material, non-public corporate information.

Sarbanes-Oxley Act (SOX) of 2002

A federal statute enacted in response to corporate accounting scandals to enhance corporate governance, mandate financial accountability, and expand SEC oversight.