Legal Environment (Business Law)
Class notes 1-21-25
The law touches most aspects of the business world
Examples: contracts for employment, contracts for real estate, lease of buildings, purchase/sale of products
Privacy laws like HIPPA
Employment (hiring/firing, discrimination on gender, age, race, religion, legal compliance for laws statutes and ordinances)
Importance of law
Ability to identify legal issues pertinent to a particular business situation
Judgment to make sound business decisions to prevent legal disputes
Knowledge to determine legal issues that require advice from council
Know when to call your attorney
Foundation to act as a sophisticated consumer of legal services
Law
Known by everyone as being intended to tell members of society what they can and cannot do
Law is made up of rules
Rules are created by the state and backed up by enforcement
Who enforces?
Courts
Law enforcement
Enforcement organizations (OHSA EPA etc)
Rule of law
Theory (universal principles)
Laws that are made are generally and equally applicable
Government businesses and individuals are all accountable under the law
Laws should be clearly published applied evenly and protect fundamental rights
An example of laws protecting rights is the Bill of Rights (first 10 amendments of the Constitution)
The process by which laws are enacted and enforced is accessible fair and efficient
Justice is delivered timely by competent ethical and independent representatives and neutrals
Property
Focus on ownership, right to exclude others from various resources
Property is a legal fenc3e that keeps out others without your permission
3 types public private shared
Concept of property and the law
Contract law
Determines how resources are exchanged between owners
Tort law
Compensates owners whose resources are wrongfully harmed by actions of others
Criminal law
Punidshes those who harm a business owners resources like theft or embezzlement
Business Organizations
Jurisprudence
Ideas or philosophies that explain the origin of law
Natural law
Law contains universal moral principles observable in nature which we can determine throgh human reasons (unjust law is no law at all - aristotle)
Positive law
Commands of the state backed up by force and punishments
Historical school
Contemporary law should focus on legal principles that have withstood the test of time
X
Punitive Damages
Purpose is to prevent breaking the law, no one wants to pay a bunch of money
BMW v Gore
Bought “new” car that wasn’t actually new and was repainted, BMW didn’t disclose that even if it was 1.5% of the cost, the repainted car was worth 10% less, so he requested punitive damages, and got 4000. Gross fraud by BMW paid punitive damages of 4 mil but reduced to 2 mil by the Alabama Supreme Court. Supreme Court granted cert. Supreme court said 500 to 1 punitive to compensatory damages not reasonable, especially since it was just paint problems and not with air bags or seatbelts. Sent it back to Alabama supreme court, ordered new trial unless platiff accepted 50k if the punitive damages award
Few awards exceeding a single digit ratio between punitive and compensatory damages will satisfy due process
Kentucky says clear and convincing evidence for punitive damage, colorado says beyond reasonable doubt
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1-28-25
Court System
Players in the court system
Judges/Justices/Magistrate
Role of a trial judge: neutral referee, determine the applicable rules of law to be used. Substantive (what is the law) vs procedural (what rules of evidence)
Cases tried to the bench - finder of fact,
determines questions of law
Judges with the greatest caseload and daily impact on its citizens
What is the role of appellate court (court of appeals), next highest court above trial court
Appeal as a matter of right
If you have bad judge, jury, etc you can take it to a higher judge
Hearsay: something someone else says and you try to admit it as evidence. You need the primary witness, not the person they told about it.
Jurors
Role of the jury: fact finders
Right to trial by hury (6th amendment criminal case), (7th amendment right to jury trial in federal civil case), State constitiution ggauranteee the right to juries in civil cases
12 member juries are not uniform, different states sit different numbers and need different amounts for verdict
Attacks to the jury system
Not qualified to distinguish fact from fiction
OJ Simpson case:
Difficult to obtain a trail by jury of peers
Reluctant to serve
Time restraints
Financial hardships
Attorneys/Lawyers/Counsel/Solicitor
Officer of the Court (ethical obligation)
Lawyers serve in three capacties
Counselor
Meetings with clients/learn facts, details, private information
Attoryney client privilege
Priveleged communications
Advocate/Barrister
The Court of Appeals is a reviewer court essentially concerned with issues of law
Issues of fact are reserved for the trial court
Review briefs, trial transcripts, and video
Prepare opinions and then give reasons for their legal opinions based on interpretation of the law
Affirm/reverse/send back to lower court with instructions
Judicial review: very powerful to be able to review and change lower court rulings
Also acts as a checks and balances in the court system
Organization of the court system - federal and state courts
Subject Matter Jurisdiction
Jurisdiction refers to the power of the court to hear a case
Court must have subject matter jurisdiction
General jurisdiction vs limited jurisdiction
Federal courts:
Three tiers:
District courts (east, west, etc)
Court of Appeals (11 circuits) (panel of 3)
US Supreme Court (9 justices)
Fed judges appointed for life vs being elected for state
To get to Supreme Court
Losing party petitions the court with a writ of certiorari, many filed, very few granted
4/9 judges have to vote to take the case
1-2% accepted, 5-7k cases filed per year
Cases that are granted include substantial gederal question, major constitutional issues, conflicted between 2 or more circuit courts
They only hear around 40-80 per year
Judicial restraint
Belief that judicial powers should be used sparingly
Power to be used only in unusual cases/great deference to the lower court
Associated with conservative judges
Also called strict constructionism
Example : plessy v Ferguson (1896) “separate but equal”
Judicial activism
Power to be sued whenever the need of society justify its use
More expansive role of the courts less reliance on precedent
Associated with liberal jduges
courts have major role to play in correcting wrongs in our society
Brown v Board of Education : desegregation of public schools
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2-4-25
The Litigation Process
Business people should know litigation process so they don’t get their company in trouble. Helps them resolve actual disputes under the rule of the law
To conduct business and enforce rights we need the litigation process to settle disputes
A complaint is the intiating document to start litgation process
Sets out the
Reasons for lawsuit
What you are seeking (damages)
Parties (defendant and plaintiff)
Jurisdiction (in Hamilton County)
Venue (what court)
Counterclaim and third-party defendants
Defendant can file counterclaim to refute what the plaintiff says in their complaint
3rd party defendant: if someone else not involved in the original complaint, and they are believed at fault they can bring them into it (ex: Box store brings in landlord, passenger - other car - spouse) to minimize risk to
Standing to sue: requirement for plaintiff to establish that he/she is entitled to have the court decide the dispute
Decided at the outset of litigation
Plantiff must allege two things
Litigation involves a case or controversy
Plantiff must allege a personal state in the resolution of the controversy. MUST ASSERT THEIR PERSONAL LEGAL POSITION AND NOT THOSE OF A THIRD PARTY (can’t have dad testify for you)
Juliana vs US.
The court did not have the power to implement new policies on CO2 emissions, plantiffs did not have stranding to sue and the 9th circuit sent the case back to the district court to dismiss the lawsuit
Personal jurisdiction
Not only courts must have subject matter jurisdiction in order to hear a case, court must have authority over the person
By filing complaint, plaintiff submits to courts powers
What about the defendant? Service of a summons is notice to appear in court (shows complaint and # of days to respond) by mail, certified mail, or sheriff
Called service of process (to make sure they know about it)
How to serve an out-of-state defendant? Kentucky summons not valid service to someone in Ohio
States have enacted long arm statutes to obtain personal jurisdiction over a non resident
Court can obtain jurisdiction over an out of state resident if
Committed tort within the state
Owns property within the state this is the subject matter of the jurisdiction
Has entered into a contract with the state or transacted business that is the subject matter of the lawsuit within the state (minimum contacts)
Classic case - world wide Volkswagen
Oklahoma resident filed product liability suit against German manufacturer, importer, wholesale distributor (NY), retailer (NY) in Oklahoma court
Court held that wholesale distributor and retail dealership both located in NY had not purposefully availed themselves of doing business in Oklahoma so had to sue in NY
Manufacturer and importer could be sued in Oklahoma because they envisioned the cars they made and imported had contacts in all 50 states
Crime must be committed in state to have jurisdiction
What if arrested in another state: extradition to their home state
Class action lawsuits: examples products (mostly medical) that cause harm to consumers
One or more plantiffs (more than 1) file lawsuit on their behalf and on other’s behalf that have similar claim (commonality)
Pretrial procedures
Answer by defendant in response to complaint, admits or denies allegations in the complaint
File counterclaim or cross claim
Contains affirmative defenses (plantiff wasnt wearing a seatbelt)
Discovery process
Learning about the case: takes the surprise out of civil litigation
All cards on the table : ID of witnesses, documents, proof of damages
Purpose: narrows the issues, create more issues or damages, sometimes gets worse, encourages settlement of the case
Interrogatories: written questions to te opposing side, answered under oath, fact finding mission (ex: have you consumed alcohol or drugs, do you have valid license, wearing a seatbelt, on your phone, wearing glasses or eye problems, names of witnesses, injuries claimed and amount of damages, employment/missing work, etc)
Requests for production of documents
Written request for production of documents that are relevant and important to the case
What kind of requests for car accident: medical records, proof of missed work (tax returns/billing records), photographs of damage to vehicle / accident scene can prove accident wasn’t that bad to prove injuries wrong (or vice versa)
Depositions: out of court meeting to find information (but under oath)
Witnesses/parties about facts of case or opinions being rendered
Take depositions because you don’t want any surprises, evaluate a party/witness
Pretrial motions
When there are ?s of law,
Defendant may file motion to dismiss instead of an answer
Even if everything is true, plaintiff cannot win
Statute of limitations, wrong, party, failure to follow a filing requirement (affadavit of merit)
Steps in a trial
The first step once trial starts is jury selection
Voir Dire (speak the truth)
Process where the judge then the attorney ask prospective jurors to see if they have bias
How to strike a prospective juror
For cause
Bias
Cannot consider death penalty in a capital case (if they’re religious, etc)
Victim of sexual assualt (same crime as issue at trial
Peremptory challenges
No racial/gender discrimination
Jury is seated, what next?
Opening statements: outline of the facts of the case, potential witnesses and what the lawyer intends to prove
Cannot argue the law because nothing has been admitted into evidence