Untitled Flashcards Set

Ch. 14-16: Business Organizations

• 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.

Ch. 17: Securities / Investor Protection

• 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.

Ch. 18: Agency and Employment Relationships

• 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.

Ch. 19: Equal Employment Opportunities

• 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.

Ch. 20: Employment Laws

• 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.

Ch. 25: Personal and Real Property

• Finders of Lost, Mislaid, or Abandoned 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: 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.