LAW 231: Quick Reference Notes

Law Fundamentals

• No man is above the law; obedience is a right, not a favor.
• Law: a body of rules of action or conduct prescribed by controlling authority and having binding force.
• Law creates duties, obligations, rights reflecting society’s accepted views; classified by subject matter (e.g., contract law, employment law).
• Jurisprudence: science and philosophy of law; defines approaches to function and application of legal doctrines.
• Primary business law purposes: ext{order}, ext{equality/justice}, ext{dispute resolution}, ext{reliability in application}.
• Legal terms are jargon/legalese; Black’s Law Dictionary (1981) as a common source.
• Legal awareness enables proactive business planning: limit liability, gain competitive edge, add value.

Business Expansion & Legal Considerations

• Expansion Through Acquisition
  • Strategy: purchase an existing business via asset or stock acquisition.
  • Legal Areas: ext{Contracts}, ext{Property/Environmental}, ext{Employment & Labor}, ext{Tax}, ext{Antitrust}.
• Expansion Through New Product Line
  • Strategy: develop and aggressively market a new product.
  • Legal Areas: ext{Securities}, ext{Intellectual Property}, ext{Administrative} (advertising/labeling).
• Expansion Through E-Commerce & International Marketing
  • Strategy: launch an interactive website and international campaigns.
  • Legal Areas: ext{Jurisdiction}, ext{International (global treaties on sales & IP)}.
• Counsel relationship
  • In-house counsel (general counsel) for large companies; may have associate counsel.
  • Smaller companies rely on attorneys from law firms for formation, governance, labor/employment, regulatory, IP, etc.

Constitutional Law & Government Structure

• Constitutional law: interpretation of state and federal constitutions.
• Federalism: shared powers between federal and state governments.
• Permanence: constitutions thought to reflect basic societal principles; amended rarely and with broad consensus.
• Preemption: constitutional law is supreme over other sources.
• Business relevance: interstate commerce power; IP protections; commercial speech; state taxation limits; executive/legislative/judicial powers to regulate business.
• Bill: a draft federal statute not yet passed.
• State vs local: statutes (state), ordinances (local); governor signs into law.
• Statutory interpretation: Palin rule as initial guide to applying statutes; statutory scheme = structure/mandates.

Statutes, Common Law, and Precedent

• Legislative history: records (debates, committee reports) used to interpret legislative intent.
• Statutory law: created by legislature; approved by executive.
• Common law: created by courts; based on previous similar cases; relies on stare decisis.
• Precedent: binding law from appellate decisions; applies to current cases with similar facts.
• Case of first impression: issues never litigated before in the court.
• Appellate courts: review trial court decisions; can overturn if inconsistent with current law.
• Notable case: South Dakota v. Wayfair, Inc., 138 ext{ S. Ct. }2080 (2018).
  • Context: SD taxed remote sellers; Quill/Bellas Hess required physical presence; Wayfair overruled.
  • Outcome: modern e-commerce requires states to collect sales tax without physical presence; physical presence rule outdated.
  • Key concepts: Physical Presence Test (Quill origin) vs Virtual Presence (cookies/apps/data storage).

Wayfair & Modern Presence Concepts

• Physical Presence Test: originated in Quill and Bellas Hess; required physical presence for tax collection.
• Virtual Presence: digital footprint can create state presence (cookies, apps, data storage).
• Questions raised: jurisdiction in digital contexts; privacy/data protection; IP in digital era; consumer protection in online marketplaces.

Legal Hierarchy, Sources, & References

• Legal hierarchy: federal > state > local; preemption applies when conflicts arise.
• Primary sources: constitutions, statutes, regulations, case law.
• Secondary sources: not binding but clarifying (Restatements, model statutes).
• Administrative law: law made by administrative agencies and the regulations governing them.
• All are primary sources of law; secondary sources aid interpretation.

Types & Quick Reference Concepts

• Restatements of the Law: uniform marketing principles for a given area.
• Model State Statutes: drafted for uniform adoption across states.
• Civil law: private rights/duties; aims to compensate losses.
• Criminal law: protects society; penalties for wrongdoing.
• Substantive law: rights and duties.
• Procedural law: process for pursuing substantive rights.
• Law vs Equity: remedies; equity emphasizes fairness when legal remedies are inadequate.
• Equitable relief: specific performance ("do it"); injunction ("stop doing it").
• Equitable maxims: general fairness rules used by courts.
• Public laws: laws from government entities.
• Private laws: binding between private parties even without statute.

Equitable Remedies & Case Highlights

• Equitable remedies available when legal remedies are inadequate (e.g., unique property).
• Wilcox Investment, L.P. v. Brad Wooley Auctioneers, Inc. (Ark. Ct. App. 2015):
  • Facts: exclusive auction for 333 acres; bid turnout concerns; possible collusion; dispute about sale.
  • Court: no collusion; specific performance ordered; money damages inadequate due to uniqueness.
  • Case questions:
    1) Why is money inadequate? Property is unique.
    2) What does collusion claim mean? Alleged conspiracy to manipulate bidding.
    3) How to prevent underpricing? Attend auction; set reserve price; clearer terms.

Key Case Notes: Ulbricht & Silk Road

• United States v. Ulbricht (Dread Pirate Roberts) – Silk Road
  • Platform: darknet marketplace for illicit goods; Bitcoin used for payments; Tor for anonymity.
  • Charges: conspiracy to launder money, narcotics trafficking, computer hacking.
  • Ulbricht defense: Bitcoin is property (IRS classification); not monetary funds under money laundering statute.
  • Court ruling: Bitcoin qualifies as funds under the statute; transactions are money laundering.
  • Aftermath: Ulbricht convicted on all counts; sentence: 2 imes ext{life} without parole + 40 years; forfeiture 184{,}000{,}000; appeals denied (2017, 2018).

Quick Reference: Notable Definitions & Distinctions

• Legislation types: statutory vs common law; criminal vs civil; private vs public law.
• Remedies: legal vs equitable; injunction vs specific performance.
• Preemption: federal law supersedes conflicting state/local laws.
• Jurisdiction concepts: presence in state for tax, regulatory purposes; digital presence considerations.