Contemporary Business and Online Commerce Law - Chapter 6

Specifics of a criminal trial

• the accused is presumed innocent until proven guilty


• the plaintiff (the government) bears the burden of proof


• the government must prove beyond a reasonable doubt that the accused is guilty of the crime charged


• the accused does not have to testify against him or herself

Definition of a crime

• crime -- a crime is any act done by a person in violation of the duties that he or she does to society and for the breach of which the law provides a penalty


• penal codes -- state and federal statutes define many crimes. Criminal conduct is also defined in many regulatory statutes


• parties to a criminal lawsuit are:
  
  
  
  • plaintiff -- the government, which is represented by the prosecuting attorney or prosecutor
  
  
  • defended -- the person or business accused of the crime, who is represented by a defense attorney
  
  
  
  

Classification of crimes

• felonies -- the most serious kind of crimes are felonies. They are mala in se (inherently evil), and they are usually punishable by imprisonment


• misdemeanors -- misdemeanors are less serious crimes than felonies. They are mala prohibita (prohibited by society), and they are usually punishable by fine and slashed work imprisonment for less than one year


• violations -- a violation is neither a felony or misdemeanor. Violations are generally punishable by a fine

Elements of a crime

most crimes require that the following two elements be proven:

1. actus reus -- guilty act


2. mens rea -- evil intent

Criminal procedure

Pretrial criminal procedure

• arrest -- an arrest is made pursuant to an arrest warrant, based on a showing of probable cause war, where permitted, by a warrantless rest


• indictment or information -- grand juries issue indictments, magistrates/judges issue information. These formally charged the accused with specific crimes


• arraignment -- the accused is informed of the charges against him or her and enters a plea in court. The plea may be -- not guilty, guilty, or nola contendere (no contest)


• plea bargaining -- in a plea bargain, the government in the accused may negotiate a settlement agreement wherein they accused agrees to make to a lesser crime then charged

Criminal trial and appeal

• a criminal trial may involve the following:
  
  
  
  • guilty -- requires unanimous vote of the jury
  
  
  • not guilty -- requires unanimous vote of the jury
  
  
  • hung jury -- not unanimous vote of the jury. The government may prosecute the case again
  
  
  
  


• an appeal involves the following:
  
  
  
  • defended -- may appeal his or her conviction
  
  
  • plaintiff -- may not appeal. A verdict of innocent
  
  
  
  

Common crimes

• robbery -- robbery is the taking of personal property from another by fear or force


• burglary -- burglary is the unauthorized entering of a building to commit a felony


• larceny -- larceny is the wrongful taking of another's property other than from his person or building


• theft -- theft is the wrongful taking of another's property, whether by robbery, burglary, or larceny


• receiving stolen property -- a person may knowingly receive stolen property with the intent to deprive the rightful owner of that property


• arson -- arson is the malicious and willful burning into a building


• extortion -- extortion and bolts a threat to expose something about another person unless that person gives up money or property

White collar crimes

white-collar crimes or crimes going to be committed by business persons involved cutting and trickery rather than physical force.

• forgery -- forgery and bolts fraudulently making or altering a document that affects the legal liability of another person


• embezzlement -- the fraudulent conversion of property by a person to whom the property was entrusted


• criminal fraud -- involves obtaining title to another's property through the section or trickery


• mail fraud -- use of mail to defraud another person


• wire fraud -- use of wire (telephone or telegraph) to defraud another person


• bribery -- offer of payment of money or property or something else of value in return for an unwarranted favor. The payor of a bride and the recipient are both guilty of the crime of bribery
  
  
  
  • commercial bribery -- is the offer of a pain it of a bribe to private persons and businesses. This is often referred to as a kickback or payoff
  
  
  • bribery of public officials for an official act is a crime
  
  
  
  


• Money Laundering Control Act -- this federal statute makes it a crime to:
  
  
  
  • knowingly engage in the money transaction through a financial institution involving property worth more than $10,000
  
  
  • knowingly engage in a financial transaction involving the proceeds of an illegal activity
  
  
  • Racketeer Influenced and Corrupt Organizations Act (RICO) -- makes it a federal crime to acquire or maintain an interest in, use income from, or conduct or participate in the affairs of an enterprise through a pattern of racketeering activity. Criminal penalties include the forfeiture of any property or business interest gained through a RICO violation
  
  
  
  

Corporate criminal liability

• corporate directors, officers, and employees are criminally liable for crimes they commit for personal benefit were on behalf of the corporation


• a corporation is criminally liable for crimes committed by directors, officers, employees, while acting on behalf of the corporation

Constitutional safeguards

Fourth Amended Protection against unreasonable search and seizures

• reasonable search and seizure based on probable cause is lawful
  
  
  
  • search warrant -- stipulates the place and scope of the search
  
  
  • warrantless search -- permitted only:
    
    
    
    • incident to an arrest
    
    
    • where evidence is in plain view
    
    
    • where it is likely the evidence will be destroyed
    
    
    
    
  
  
  
  


• exclusionary rule -- evidence obtained from an unreasonable search and seizure is tainted evidence that may not be introduced at a government proceeding against a person searched


• business premises -- are protected by the fourth amendment, except that certain regulated industries may be subject to warrantless searches authorized by statute

Fifth Amendment privilege against self-incrimination

this amendment provides that no person shall be compelled in any criminal case to be a witness against himself. A person asserting this privilege is said to have taken the fifth.

• non-testimonial evidence -- this evidence (example -- fingerprints, body fluids) is not protected


• businesses -- the privilege applies only to natural persons; businesses cannot assert the privilege


• Miranda rights -- a criminal suspect must be informed of his or her Fifth Amendment rights before the suspect can be interrogated by the police or government officials


• immunity from prosecution -- immunity is granted by the government to obtain otherwise privileged evidence. The government agrees not to use the evidence given against the person who gave it


• attorney-client privilege -- an accused's lawyers cannot be called as a witness against the accused


• other privileges -- the following privileges have been recognized, with some limitations:
  
  
  
  • psychiatrist / psychologist
  
  
  • Priest/Minister/Rabbi
  
  
  • spouse
  
  
  • parent -- trial
  
  
  
  


• accountant-client privilege -- such privilege is not recognized at the federal level. Some states recognizes privilege and state law actions

Fifth amendment protection against double jeopardy -- sixth amendment right to a public jury trial

this amendment protects persons from being tried twice by the same jurisdiction for the same crime. If the act violates the wall of two or more jurisdictions, each jurisdiction may try the keys. The Fifth Amendment guarantees criminal defendants, the following rights:

• to be tried by an impartial jury


• to confront the witness


• to have the assistance of a lawyer


• to have a speedy trial

Eight amendment protection against cruel and unusual punishment

the eighth amendment protects criminal defendants from cruel and unusual punishment. Capital punishment is permitted by this amendment.

 

 

Contemporary Business and Online Commerce Law - Chapter 5

Intellectual Property and Internet Law

Trade secrets and information technology

• trade secret -- a trade secret is a product formula, pattern, design, compilation of data, customer lists, or other business secret that makes a business successful. The owner of a trade secret must take responsible precautions to prevent its trade secret from being discovered by others.
• misappropriation of a trade secret -- obtaining another's trade secret through unlawful means such as theft, bribery, or espionage is a tort. a successful plaintiff can recover profits, damages, and an injunction against the offender.
• the economic espionage act -- this act is a federal statute that makes it a crime for any person to convert a trade secret for his or her own or another's benefit, knowingly or intending to cause injury to the owners of the trade secret.

Traditional and cyber patents

Patent law is exclusively federal law; there are no state patent laws.

• patent -- patentable subject matter includes innovations such as machines; processes; compositions of matter; improvements to existing machines, processes, or compositions of matter; designs for articles of manufacture; asexually reproduced play its cynical and in living matter, invented by man.
  • to be patented, an invention must be:
    • novel
    • useful
    • nonobvious
• business plans -- the US Court of Appeals held that business plans are patentable
• patent application -- an application containing a written description of the invention must be filed with the US patent and trademark office in Washington, DC
• term -- patents are valid for 20 years
• public use doctrine -- a pattern may not be granted if the invention was used by the public. For more than one year prior to the filing of the patent application
• public infringement -- the unauthorized use of an author's patent constitutes patent infringement. The patent holder may recover damages and other remedies against the infringer.
• the American Inventors Protection Act -- this federal statute does the following:
  • permits an inventor to file a provisional application with the US patent and trademark office, three months before the filing of a final patent application
  • requires the patent and trademark office to issue a patent within three years after the filing of a patent application
• patent appeals -- these appeals are heard by the US Court of Appeals for the Federal Circuit in Washington, DC

Copyrights and Internet law

copyright law is exclusively federal law; there are no state copyright laws.

• copyright -- only tangible writings can be copyrighted. These include books, newspapers, addresses, musical compositions, motion pictures, works of art, architectural plans, greeting cards, photographs, sound recordings, computer programs, and mask works fixed in semi conductor chips.
• requirements for copyright -- the writing must be the original work of the author
• copyright registration -- copyright registration is permissive and voluntary. Published and unpublished work may be registered with the US copyright office in Washington, DC. Registration itself does not create the copyright.
• term -- copyrights are for the following terms:
  • individual holder -- life of the author plus 70 years
  • corporate Holder -- either 120 years from the date of creation or 2 * 95 years from the date of publication, which ever shorter.
• copyright infringement -- copyright infringement is the copying of a substantial and material part of a copyrighted work without the worst permission. The copyright holder may recover damages and other remedies against the infringer.
• fair use doctrine -- this doctrine permits use of copyrighted material without the consent of the copyright holder for limited uses (scholarly work, parody or satire, and brief quotation in news reports)
• no electronic theft act (NET Act) -- this federal statute makes it a crime for a person to willingly infringe a copyrighted work exceeding $1000 in retail value
• Digital millennium copyright act (DMCA) -- this federal statute, enacted in 1998, provides civil and criminal penalties that:
  • prohibit the manufacture and distribution of technologies, products, or services primarily designed for the purpose of circumventing rappers or encryption protection
  • prohibit unauthorized access to copyrighted digital works by circumventing the wrapper or encryption technology that protects intellectual property

Trademarks and online commerce

• Mark -- a mark is a trade name, symbol, Word, logo, design, or device that distinguishes the owners goods or services. Marks are often referred to collectively as trademarks. Types of marks are:
  • trademark -- identifies goods of a particular business
  • service mark -- identifies service of the particular business
  • certification mark -- certifies that goods or services are of a certain quality or origin
  • collective mark -- used by cooperatives, associations, and fraternal organizations
• requirements for trademark -- the mark must be either distinctive or have acquired a secondary meaning. The mark must have been used in commerce or the holder must intend to use the mark in commerce and actually do so within six months after registering the mark
• trademark registration -- marks are registered with the US patent and trademark office is in Washington, DC
• term -- the original registration of a mark is valid for 10 years and can be renewed for an unlimited number of 10 year periods
• trademark infringement -- the unauthorized use of another's registered mark is called trademark infringement. The mark holder may recover damages and other remedies from the infringer.
• trade dress -- trade dress involves the protection of the "look and feel" of a product, a product packaging, or a service establishment.
• generic name -- a mark that becomes a common term for product line or type of service loses its protection under federal trademark law.
• Federal Dilution Act of 1955 -- this federal statute protects famous marks from dilution. A violation of the act requires at the Mark B. Themis, the use by the other party be commercial, and they used cause dilution of the distinctive quality of the mark.

Internal protection of intellectual property rights

• Paris convention -- this international treaty protects patents and trademarks
• Berne convention -- this international treaty protects copyright
• WIPO Copyright Treaty -- this international treaty protects copyrights to computer programs and data compilations
• WIPO Phonogram Treaty -- this international treaty gives performers and producers the exclusive right to broadcast, reproduce, and distribute copies of their performances.

Contemporary Business and Online Commerce Law - Chapter 4

Intentional torts against persons

1. assault -- threat of immediate harm or offensive contact, or any action that arouses reasonable apprehension of imminent harm
2. battery -- unauthorized and harmful or offensive physical contact with another person
   • transferred intent doctrine -- if a person intends to injure one person that actually harms another person, the law transfers the perpetrators and 10 from the target to the actual victim
3. false imprisonment -- intentional confinement or restraint of another person without authority or justification and without that person's consent
   • merchant protection statutes -- the statutes permit businesses to stop, detained, and investigate suspected shoplifters. (And not be held liable for false imprisonment) if the following requirements are met:
     • there are reasonable grounds for the suspicion
     • suspects are detained for a reasonable time
     • investigations are conducted in a reasonable manner
4. defamation of character -- the defendant makes and untrue statement of fact about the plaintiff that is published in the third party. Truth is in absolute defense.
   • types of defamation:
     • slander -- oral defamation
     • libel -- written defamation
   • public figure plaintiffs -- these plaintiffs must prove the additional element of malice
5. misappropriation of the right to publicity -- this refers to appropriating another person's name or identity for commercial purposes without that person's consent. Also called the tort of appropriation.
6. invasion of privacy -- invasion of privacy is the onboard kid and undesired publicity of a private fact about a person. The fact is not have to be untrue. Truth is not a defense.
7. intentional infliction of emotional distress -- this tort involves extreme and outrageous conduct intentionally or recklessly done that causes severe emotional distress. Some states require that the mental distress be manifested by physical injury. Also known as the tort of outrage.
8. malicious prosecution -- a successful defendant in a prior lawsuit can sue the plaintiff if the first lawsuit was frivolous.

Intentional torts against property

1. trespasses to land -- trespass to land involves interference with a land owner's right to exclusive possession of his or her land
2. trespass to personal property -- trespass to personal property are cursed when a person endures another person's personal property or interferes with that person's enjoyment of his or her property
3. conversion of personal property -- this port invokes taking over another person's personal property in depriving him or her of the use and enjoyment of the property

unintentional torts (negligence)

elements of negligence

to establish negligence, the plaintiff must prove:

1. the defendant owed a duty of care to the plaintiff
2. the defendant breached its duty
3. the plaintiff suffered injury
4. the defendants negligent act caused the plaintiff's injury.

two types of causation must be shown:

1. causation in fact (or actual cause). The defendants negligent act was the actual cause of the plaintiff's injury
2. proximate cause (or legal cause). The defendant is liable only for the foreseeable consequences of his or her negligent act

Professional Malpractice

doctors, lawyers, architects, accountants, and other professionals only duty of ordinary care in providing their services. They are judged by a reasonable professional standard. Professionals who've reached this duty are liable to clients, and some third parties for professional malpractice.

Special Negligence Doctrines

1. negligent infliction of emotional distress -- a person who would is a close relatives injury or death may sue the negligent party, who caused the accident to recover damages for any emotional distress suffered by the bystander. to recover for negligent infliction of emotional distress, the plaintiff must prove:
   1. a relative was killed or injured by the defendant
   2. the plaintiff suffered severe emotional distress
   3. the plaintiffs mental distress resulted from a sensory and contemporaneous observance of the accident -- some states require that the mental distress be manifested by physical injury
2. negligence per se -- a statute or an ordinance establishes the duty of care. A violation of the statute or ordinance constitutes a breach of this duty of care
3. res ipsa loquitur -- a presumption of negligence is established if the defendant had exclusive control of the instrumentality or situation that caused the plaintiff's injury and the injury would not have or nearly occurred but for someone's negligence. The defendant may rebut this presumption.
4. good Samaritan laws -- these laws relieve doctors and other medical professionals from liability for ordinary negligence. When rendering medical aid in emergency situations.
5. dram shop acts -- the state statutes make taverns and bartenders liable for injuries caused to or by patrons, who are served too much alcohol and cause injury to themselves or others.
6. guest statute's -- the statutes provide that a driver of a vehicle is not liable for ordinary negligence to passengers, he or she graciously transports. The driver is liable for gross negligence.
7. fireman's rule -- firefighters, police officers, and other government employees who are injured in the performance of their duties cannot sue the person who negligently caused the danger situation that caused the injury.
8. danger invite rescue doctrine -- a person who is injured while going to someone's rescue may sue the person who caused the danger situation.
9. social host liability -- some state to make social hosts liable for injuries caused by guests who are served alcohol at a social function. In later cause injury, because they are intoxicated.
10. liability of landowners -- landowners (and tenets) of the following duties to persons who come up on their property:
    1. invitees -- duty of ordinary care
    2. licenses -- duty of ordinary care
    3. trespassers -- did he not to willfully and wantonly injure trespassers
11. liability of common carriers and innkeepers -- common carriers in innkeepers give a duty of utmost care, rather than the duty of ordinary care, to protect their passengers and patrons from injury

Defenses against negligence

1. superseding event -- a superseding event is in intervening event caused by another person that caused the plaintiff's injuries that relieves the defendant from liability
2. assumption of the rest -- a defendant is not liable for the plaintiff's injury. If the plaintiff had knowledge of a specific risk and voluntarily assumed that risk
3. plaintiffs partially at fault -- the states have adopted one of the following two rules that affect a defendant's liability if the plaintiff had been partially at fault for causing his or her own injuries:
   • contributory negligence -- a plaintiff cannot recover anything from the defendant
   • comparative negligence -- damages are apportioned according to the party's fault. Also called comparative fault

Special business torts

1. entering business without a license -- the law requires that persons obtain licenses from the government prior to entering certain businesses or professions
2. palming off -- a company passes off its products or services as those of another company
3. disparagement -- disparagement is an untrue statement about the products, services, property, or reputation of a business. Also called product disparagement, trade libel, or slander of title.
4. false advertising -- section 43(a) of the Lanham Act, a federal law, prohibits false and misleading advertising. State laws also prohibit false and misleading advertising.
5. international misrepresentation -- when this tort occurs, a wrongdoer, the frogs and other person out of money, property, or something else of value. Also known as fraud or deceit. The following elements must be shown:
   1. the wrongdoer made a false representation of material fact
   2. the wrongdoer had knowledge that the representation was false and intended to deceive the innocent party
   3. that it is party justifiably relied on the misrepresentation
   4. the innocent party was injured
6. intentional interference with contractual relations -- with this tort, a third party intentionally interferes with another party's contract and introduces the other party to that contract to breach it, causing the nonbreaching party injury
7. breach of the implied covenant of good faith and fair dealing -- with this tort, a party to a contract does not act in good faith or fails to deal fairly in achieving the object of the contract. This duty is implied in only certain contracts (example: insurance contracts). Also called the tort of bad faith.

Tort damages

1. actual damages -- actual damages include compensation for personal injury, pain and suffering, emotional distress, and other injuries caused by the defendants tortious conduct
2. punitive damages -- punitive damages are recoverable against a defendant for intentional or egregious conduct. They are a worded to punish the defendant, to deter the defendant from similar conduct in the future, and to set an example for others. The plaintiff may keep these damages.

Strict liability

with strict liability, liability is assessed on defendants without regard to full. This tort applies to abnormally dangerous activities and certain products.

International Business Chapter 6 - business-government trade relations - summary

Political, economic, and cultural motives behind governmental intervention in trade.

Despite the advantages of free trade, government intervention is common.

The main political motives behind government intervention in trade include:

• protecting jobs
• preserving national security
• responding to other nations on fair trade policies
• gaining influence over other nations

The most common economic reasons given for nations attempt to influence international trade are:

• protection of young industries from competition
• protection of a strategic trade policy

According to the infant industry argument, it countries even merging industries need protection from international competition during their development phase, until they become sufficiently competitive internationally. Although conceptually appealing, this argument can cause domestic companies to become noncompetitive, and inflate prices. Believers in strategic trade policy argue that government intervention can help companies take advantage of economies of of scale and the first movers in their industries. But government assistance to domestic companies can result in inefficiency, higher costs, and even trade wars between nations.

Perhaps the most common cultural motive for trade intervention is protection of national identity. On wanted cultural influence can cause a government to block imports that it believes are harmful.

Methods governments used to promote international trade.

A subsidy is financial assistance to domestic producers in the form of cash payments, low interest loans, tax breaks, product price supports, or some other form. It is intended to assist domestic companies in fending off international competitors. Critics charge that subsidies amount to corporate welfare and are detrimental to the long-term.

Governments also can offer export financing -- lends to exporters that they would not otherwise receive or linens at below market interest rates. Another option is to guarantee that the government will repay a companies lend if the company should default on repayment -- called a loan guarantee.

Most countries permit trade with other nations by creating what is called a foreign trade zone (FTZ) -- a designated geographic region in which merchandise is allowed to pass through with lower customs duties (taxes) and/or fewer customs procedures. Finally, most nations have special government agencies responsible for promoting exports. These agencies organized trips abroad for trade officials and business people and open offices abroad to promote home country exports.

Government restriction of international trade.

A tariff is a government tax levied on a product as it enters or leaves a country. And export tariff is one that is levied by the government of a country that is exporting a product. A tariff levied by the government of a country that a product is passing through on its way to its final destination is called a transit terror. And import tariff is one that is levied by the government of a country that is importing a product.

Three categories of import tariff are:

• ad valorem tariffs
• specific tariffs
• compound tariffs

A restriction on the amount (measured in units or wait) of a good day can enter or leave a country during a certain period of time is called a quota. Governments may impose import quotas to protect domestic producers or export quotas to maintain adequate supplies in the home market or increased prices of a product on world markets.

A complete ban on trade (imports and exports). In one of more products with a particular country is called an embargo. Laws stipulating that a specified amount of a good or service be supplied by producers and the domestic markets are called local content requirements. Governments can also discourage imports by causing administrative delays (regulatory controls of bureaucratic rules to impair imports) or currency controls (restrictions on the convertibility of a currency).

The world trade organization promotes free trade.

The General Agreement on Tariffs and Trade (GATT) was a treaty designed to promote free trade by reducing the care of and nontariff barriers to international trade.

The Uruguay Round of GATT negotiations that ended 1994, made significant process and several areas:

• international trade and services was included for the first time
• intellectual property rights were clearly defined
• tariff and nontariff barriers in agricultural trade were reduced significantly
• the World Trade Organization (WTO) was created

The three main goals of the WTO are to help the free flow of trade, to help negotiate further opening of markets, and to settle trade disputes between its members. A key component of the WTO is the principal of nondiscrimination called normal trade relations that requires WTO members to treat all members equally.

When a company exports, a product at a price either lower than the price it only charges in its domestic market or lower than the cost of production, it is said to be dumping. The WTO allows a nation to retaliate against dumping under certain conditions.

International Business Chapter 6 - business-government trade relations -terms

Free-trade -- pattern of imports and exports that would result in the absence of trade barriers
subsidy -- financial assistance to domestic producers in the form of cash payments, low interest loans, tax breaks, product price supports, or some other form
foreign trade zone (FTZ) -- designated geographic region in which merchandise is allowed to pass through with a lower customs duties (taxes) and/or fewer customs procedures.
Tariff -- government tax levied on a product as it enters or leaves a country.
Ad valorem tariff -- tariff levied as a percentage of the stated price of imported product
specific tariff -- tariff levied as a specific fee for each unit (measured by number, weight, etc.) of an imported product.
Compound tariff -- tariff levied on an imported product in calculated partly as a percentage of its stated price and partly as a specific fee for each unit.
Quota -- restriction on the amount of a good they can enter or leave a country during a certain period of time
voluntary export restraint (VER) -- unique version of export quota that a nation imposes on its exports, usually at the request of an importing nation.
Tariff-quota -- lower tariff rate for a certain quantity of imports into higher rate for quantities that exceed the quota.
Embargo -- complete ban on trade (imports and exports). In one or more products with particular country.
Administrative delays -- regulatory controls or bureaucratic rules designed to impair the rapid flow of imports into a country.
Currency controls -- restrictions on the convertibility of a currency into other currencies.
Normal trade relations -- requirement that WTO members extend the same favorable terms of trade to all members that they extend to any single member.
Dumping -- practice of exporting a product at a price either lower than the price that the product only command and its domestic market or lower than the cost of production.
Anti-dumping duty -- additional tariff placed on an imported product that a nation believes is being dumped on its market.
Countervailing duty -- additional tariff placed on an imported product that a nation believes is receiving an unfair subsidy.

International Business Chapter 5 - international trade -summary

International trade volume and world output.

International trade is the purchase, sale, or exchange of goods and services across national borders. International trade provides a country's people with a greater choice of goods and services and is an important engine for job creation in many countries. Most of world merchandise trade is comprised of trade and manufactured goods. Service exports make up roughly 20% of total world trade annually. Slower world economic outputs slows the volume of international trade, and higher output spurs greater trade. Also, trade has consistently grown faster than output.

The pattern of international trade in merchandise is dominated by flows among the high and come economies of the world (60%), followed by trade among high income countries and low and middle income nations (34%. Trade among the low and middle income nations is just 6% of the total. A large amount of trade in Western Europe is interregional, meaning that it largely occurs between Western European nations.

The impacts of mercantilism

the trade theory that nation should accumulate financial wealth, usually the form of gold, by encouraging exports and discouraging imports is called mercantilism. Nation-states in Europe followed this economic philosophy from about 1500 to the late 1700s.

Countries implemented mercantilism by doing three things:

1. first, they increased their wealth by maintaining a trade surplus -- the condition that results when the value of the nation's exports is greater than the value of its imports
2. second, national governments actively intervened in international trade to maintain a trade surplus
3. third, mercantilist nations required less-developed territories (colonies) around the world to serve as sources of inexpensive raw materials, and as markets for higher-priced finished goods.

Mercantilism assumes that a nation increases its wealth only at the expense of other nations -- a zero-sum game.

Absolute advantage and comparative advantage

the ability of a nation to produce a good more efficiently than any other nation is called an absolute advantage. According to this theory, international trade should be allowed to flow according to market forces. A country can concentrate on producing the goods in which it holds an absolute advantage. And then trade with other nations to obtain the visit needs, but does not produce. Because there are games to be had by both countries party to an exchange, international trade is shared to be a positive-sum game. The theory measures a nation's wealth by the living standards of its people.

A nation holds a comparative advantage in the production of a good when it is unable to produce the good more efficiently than other nations, but can produce it more efficiently than they can any other good. As a result, trade is still beneficial. Even if one country is less efficient in the production of two goods, so long as it is less inefficient and the production of one of the goods.

Factor proportions and international product lifecycle theories.

The factor proportions theory states that countries produce and export goods that require resources (factors) that are abundant and import goods that require resources that are in short supply. The factor proportions. Predicts that a country will specialize in products that require labor. If it's cost is low relative to the cost of land in capital. Alternatively, a country will specialize in products that require lien and capital equipment. If their cost is low relative to the cost of labor. The apparent paradox between predictions of the theory and actual trade flows is called the Leontief paradox.

The international product life cycle theory says that a company will begin exporting its product, and later undertake foreign direct investment as the product news through its life cycle. In the new-product stage production volume is low in remains based in the home country. And the maturing product stage, the company introduces production facilities and the countries with the highest in the end. And the standardized product stage competition forces of aggressive search for low-cost production bases in developing nations to supply a worldwide market.

New trade and national competitive advantage theories.

The new trade theory argues that as a company increases. The extent to which it specializes in the production of a particular good, output rises because of the gains in efficiency. As specialization in output increase, companies can realize economies of scale, thereby pushing the unit costs of production lower. The presence of large economies of scale can allow a firm to gain a first mover advantage -- the economic and strategic advantage gained by being the first company to enter an industry.

National competitive advantage there he states that a nations competitiveness in an industry (and, therefore, trade flows) depends on the capacity of the industry to innovate and upgrade.

The Porter diamond identifies four elements that form the basis of national competitiveness:

1. factor conditions, including the skill levels of different segments of the workforce and the quality of the technology infrastructure
2. demand conditions, such as a sophisticated domestic market
3. related and supporting industries that spring up and form clusters of related economic activities
4. firm strategy, structure, and rivalry conditions that are present in an industry.

Finally, the actions of governments and the occurrence of chance of vents can also affect the competitiveness of a nations company.

International Business Chapter 5 - international trade - terms

International trade -- purchase, sale, or exchange of goods and services across national borders.
mercantilism -- trade theory that nations should accumulate financial wealth, usually in the form of gold, by encouraging exports and discouraging imports.
Trade surplus -- condition that results when the value of the nation's exports is greater than the value of its imports.
Trade deficit -- condition that results when the value of a country's imports is greater than the value of its exports.
Absolute advantage -- ability of a nation to produce a good more efficiently than any other nation.
Comparative advantage -- an ability of the nation to produce a good more efficiently than other nations, but an ability to produce that good more efficiently than it does any other good.
Factor proportions theory -- trade theory holding that countries produce and export goods that require resources (factors) that are abundant and import goods that require resources in short supply.
International product life cycle theory -- theory holding that a company will begin by exporting its product, and later undertake foreign direct investment as a product moves through its life cycle.
New trade theory -- trade theory holding that #1 -- there are games to be made from specialization in increasing economies of scale, #2 -- the company's first to market can create barriers to entry, #3 -- Government may play a role in assisting its home companies.
First-mover advantage -- economic and strategic advantage gained by being the first company to enter an industry.
National competitive advantage theory -- trade theory holding that a nation's competitiveness in an industry depends on the capacity of the industry to innovate and upgrade

International Business Chapter 4 -Economic Systems - summary

Centrally planned economy is declining.

An economic system consists of the structure and processes that a country uses to allocate its resources and conduct its commercial activities. In a centrally planned economy, the government-owned land, factories, and other economic resources, and plans nearly all economic related activities. The philosophy of central planning stresses the group over individual well-being and strives for economic and social equality.

The use of central planning is declining for several reasons.

• First, Garris resources were wasted because central planners paid little attention to product quality and buyers needs.
• Second, a lack of incentives to innovate resulted in little or no economic growth and consistently low standards of living.
• Third, central planners realized that other economic systems were achieving far higher growth rates for other countries.
• Fourth, consumers became fed up with a lack of basic necessities such as adequate food, housing, and healthcare.

Mixed economy and privatization

In a mixed economy, land, factories, and other economic resources are split between private and government ownership, with governments tending to control the economic sectors crucial to national security and long-term stability. Proponents of mixed economies contend that a successful economic system must be not only efficient and innovative, but also should protect society from the excesses of Anh checked individualism and organizational greed. However, attempting to become more efficient in their use of scarce resources, many mixed economies are engaging in privatization -- the sale of government-owned economic resources to private operators.

Market economy

in a market economy, private individuals or businesses and the majority of lien, factories, and other economic resources. Economic decisions are influenced by the interplay of supply (the quantity of the product that producers are willing to provide a specific selling price) in demand (the quantity of a product that buyers are willing to purchase at a specific selling price). Market economies is rooted in the belief that individual concerns are paramount. And that the group benefits when individuals receive proper incentives and rewards.

To function smoothly, the market economy requires:

1. free choice (in buyers purchasing options)
2. free enterprise (and producers competitive decisions)
3. price flexibility (reflecting supply and demand)

The government's role in a market economy centers on:

1. enforcing antitrust laws
2. preserving property rights
3. providing a stable fiscal and monetary environment
4. preserving political stability

Measuring a nation's level of development

Economic development refers to the economic well-being of one nation's people compared with that of another nation's people.

There are three methods for gauging economic development:

1. national production -- which includes measures such as the gross national product (GNP -- the value of all goods and services produced in one year by a country) and gross domestic product (GDP -- the value of all goods and services produced in one year by the domestic economy)
2. purchasing power party (PPP), which refers to the relative ability of two countries current cease to buy the same amount of goods in those two countries and is used to correct comparisons made at official exchange rates
3. The United Nations human development Index (HDI), which measures the extent to which a people's needs are satisfied and addressed equally across the population

Economic transition

the process whereby a nation changes its fundamental economic organization in order to create free-market institutions is called economic transition.

Typically, five reform measures are involved:

1. macroeconomic stabilization
2. liberation of economic activity
3. legalization of private enterprises in privatization of state owned enterprises
4. removal of barriers to free trade, investment, and currency flows
5. development of a social welfare system

There are four major obstacles to successful economic transition.

1. First, there is a lack of managerial expertise, because central planners made virtually all operations, pricing, and sales decisions.
2. Second, there is a shortage of capital to pay for new communications in infrastructure, the financial institutions, and the education of people about the working of a market economy.
3. Third, cultural differences between transition economies and the West can make it difficult to introduce modern management practices.
4. Fourth, environmental degration has caused lower workforce productivity due to substandard health conditions.

International Business Chapter 4 -Economic Systems - terms

Economic system -- structure and processes that a country uses to allocate its resources and conduct its commercial activities.
Centrally planned economy -- economic system in which a nation's land, factories, and other economic resources are entered by the government, which plans nearly all economic activity.
mixed economy -- economic system in which land, factories, and other economic resources are rather equally split between private and government ownership.
Privatization -- policy of selling government-owned economic resources to private companies and individuals
market economy -- economic system in which the mind awarding of a nation's lien, factories, and other economic resources are privately owned, either by individuals or businesses.
Supply -- quantity of a good or service that producers are willing to provide at a specific selling price.
Demand -- quantity of a good or service that buyers are willing to purchase at a specific price
economic development -- measure for gauging the economic well-being of one nation's people as compared with that of another nation's people
purchasing power -- value of goods and services that can be purchased with one unit of the country's currency.
Purchasing power parity (PPP) -- relative ability of two countries. Currencies to buy the same "basket" of goods and those two countries.
Human development Index (HDI) -- measure of the extent to which a people's needs are satisfied in the degree to which these needs are dressed equally across the nation's entire population.
Developed country -- country that is highly industrialized, highly efficient, and whose people enjoy a high quality of life.
Newly industrialized country (NIC) -- country that has recently increased. The portion of its national production and exports derived from industrial operations.
Emerging markets -- newly industrialized countries, plus, the news with the potential to become newly industrialized.
Developing country -- nation that has a poor infant structure and extremely low personal incomes.
Technological dualism -- use of the latest technologies in some sectors of the economy coupled with the use of outdated technologies in other sectors
economic transition -- process by which a nation changes its fundamental economic organization and create new free-market institutions

Contemporary Business and Online Commerce Law - Chapter 7

Ethics and Social Responsibility of Business

International Law

Caux Round Table Principles for International Business

a collaboration of leaders from various multinational corporations -- promulgated on international ethics code called the Principles for International Business. So they were first introduced in 1994, the Principles have been adopted by many multinational corporations around the world.

The Caux Round Table Principles are:

1. the responsibility of business beyond shareholders toward stakeholders.


2. the economic and social impact of businesses: toward innovation, justice, and world community


3. business behavior -- beyond the letter of law toward a spear of trust


4. respect for rules


5. support for multilateral trade


6. respect for the environment


7. avoidance of illicit operations

Theories of Ethics

• ethical fundamentalism -- persons look to an outside source (ex. Bible or Koran) or central figure for ethical guidelines


• utilitarianism -- persons choose the alternative that would provide the greatest good to society


• Kantain ethics -- a set of universal rules establishes ethical duties. The rules are based on reasoning that require consistency in application and reversibility.


• Rawls's social justice theory -- moral duties are based on on implied social contract. Fairness is justice. The rules are established from unoriginal position of a "veil of ignorance."


• ethical relativism -- individuals decide what is ethical based on their own feelings as to what is right or wrong

The Corporate Social Audit

corporations that conduct social audits will be more apt to prevent unethical and illegal conduct by managers, employees, agents. Companies should institute the following procedures when conducting a social audit:

• an independent outside firm should be hired to conduct the audit. This will ensure autonomy and objectivity in conducting the audit.


• the company's personnel should cooperate fully with the auditing firm, while the audit is being conducted.


• the auditing firm should report its findings directly to the company's board of directors.


• the results of the audit should be reviewed by the Board of Directors


• the board of directors should determine how the company can better meet its duty of social responsibility and can use the audit to implement a program to correct any deficiencies it finds

Theories of Social Responsibility

• maximizing profits -- to maximize profits for stockholders


• moral minimum -- to avoid causing harm and to compensate for harm caused


• stakeholder interest -- to consider the interests of all stakeholders, including stockholders, employees, customers, suppliers, creditors, and local communities


• corporate citizenship -- to do good and solve social problems

Contemporary Business and Online Commerce Law - Chapter 3

Traditional, Alternative, and E-commerce Dispute Resolution.

State Court Systems.

1. Limited jurisdiction trial courts -- state courts that hear matters of a specialized or limited nature (examples).
   
   
   
   • Misdemeanor criminal matters.
   
   
   • Traffic tickets.
   
   
   • Civil matters, under a certain dollar amount.
   
   
   
   






Many states have created small claims courts that hear small dollar amounts civil cases where the parties cannot be represented by lawyers.






2. General jurisdiction trial courts -- state courts that hear cases of a general nature that are not within the jurisdiction of limited jurisdiction, trial courts


3. Intermediate appellate courts -- state courts that hear appeals from state trial courts.  The appellate court reviews the trial court recording in making its decision.  Their new evidence is introduced at this level.


4. Highest state court -- each state has a highest court in its court system.  This Court hears appeals from appellate courts, and where appropriate, trial courts.  This court reviews the record in making its decision.  Their new evidence is introduced at this level.  Most states call this court, the Supreme Court.

The Federal Court System

1. Special federal courts -- federal courts have specialized or limited jurisdiction. They include:
   
   
   
   • US Tax Court -- hears cases involving federal tax laws
   
   
   • US Claims Court -- hears cases brought against the United States
   
   
   • US Court of international trade -- hears cases involving terrorists and international commercial disputes
   
   
   • U.S. Bankruptcy Court's -- hear cases involving federal bankruptcy law
   
   
   
   


2. US District courts -- federal trial courts of general jurisdiction they hear cases not within the jurisdiction of specialized courts. There is at least one US District Court per state: more populated states have several District Court's. The area served by one of these courts is called a district.


3. US Courts of Appeals -- intermediate federal appellate courts that hear appeals from district courts located in their circuit, and in certain instances from special federal courts and federal administrative agencies. There are 12 geographical circuits in the United States. 11 Serb areas that comprised several state, while another is located in Washington, DC. A 13th circuit court -- the Court of Appeals for the Federal Circuit -- is located in Washington, DC. And it reviews patent, trademark, and international trade cases.


4. US Supreme Court -- this is the highest court of the federal court system. A hears appeals from the circuit courts and, in some instances, from special courts in US District Court's. The court, which is located in Washington D. C. is composed of nine justices, one of whom is named Chief Justice.


5. Decisions by the US Supreme Court
   
   
   
   • Writ or certiori -- to have a case heard by the US Supreme Court, a petitioner must file a petition for certiori within the court. If the court decides to hear the case, it will issue a writ or certiori.
   
   
   • voting by the US Supreme Court:
     
     
     
     • unanimous decision -- all of the justices agree as to the outcome in reasoning used to decide the case. The decision becomes precedent
     
     
     • majority decision -- a majority of the justices agree as to the outcome and reasoning used to decide the case. The decision becomes precedent
     
     
     • plurality decision -- a majority of the justices agree to the outcome, but not the reasoning. The decision is not precedent
     
     
     • tie decision -- if there is a tie them, the lower court's decision stands. The decision is not precedent
     
     
     • concurring opinion -- a justice who agrees as to the outcome of the case. But not the reasoning used by other justices may write a concurring opinion setting forth his or her reasoning
     
     
     • dissenting opinion -- a justice who disagrees with the outcome of the case may write a dissenting opinion, setting forth his or her reasoning for dissenting
     
     
     
     
   
   
   
   

Jurisdiction of Federal and State Courts

1. Jurisdiction of federal courts -- federal courts may hear the following cases:
   
   
   
   • federal question -- cases arising under the U.S. Constitution, treating, and federal statutes and regulations. There is no dollar amount limited federal question cases
   
   
   • diversity of citizenship -- cases between citizens of different states and a citizen of a state and a citizen or subject of a foreign country. Federal courts must apply the appropriate state laws that such cases. The controversy must exceed $75,000 for the federal court to hear the case
   
   
   
   


2. Jurisdiction of state courts -- state court here some cases that may be heard by federal courts
   
   
   
   • exclusive jurisdiction -- federal courts have exclusive jurisdiction to hear cases involving federal crimes, antitrust and bankruptcy, patent and copyright cases, suits against the United States, and most admirality cases. State courts may not hear these matters
   
   
   • concurrent jurisdiction -- state courts have concurrent jurisdiction to hear cases involving diversity of citizenship cases in federal question cases, over which the federal courts do not have exclusive jurisdiction. The defendant may have the case removed to federal court
   
   
   
   

Jurisdiction and Venue of Courts

Standing to sue, jurisdiction and venue

1. standing to sue -- to bring a lawsuit, the plaintiff must have some stake in the outcome of the lawsuit


2. subject matter jurisdiction -- the court must have jurisdiction over the subject matter of the lawsuit. Each corps has limited jurisdiction to hear only certain types of cases


3. and personam jurisdiction (or personal jurisdiction) -- the court must have jurisdiction over the parties to a lawsuit. The plaintiff submits to the jurisdiction of the court by filing the lawsuit they are. Personal jurisdiction is obtained over the defendant through service of process to that person.


4. In rem jurisdiction -- a court may have jurisdiction to hear and decide a case because it has jurisdiction over the property at issue in the lawsuit


5. Quasi in rem jurisdiction (or attachment jurisdiction) -- a plaintiff who obtained a judgment against a defendant in one state be utilized. The court system of another state to attach property of the defendants that is located in the second state


6. long arm statutes -- these statutes permit a state to obtain personal jurisdiction over on out-of-state defendant as long as the defendant had the requisite minimum contact with the state. The out-of-state defendant may be served process outside the state in which the lawsuit it has been brought


7. venue -- the case may be heard by a quirk that has jurisdiction near us to where the incident. At issue occurred or the parties reside. A change of venue will be granted if prejudice would occur because of pretrial publicity or another reason


8. Forum selection clause -- a clause in a contract that designates the court will hear any dispute that arises out of the contract

Pretrial Litigation Process

Pleadings -- are paperwork that initiates in response to a lawsuit. Pleadings include:

1. complaint -- filed by the plaintiff with the core and served with a summons on the defendant. It sets forth the basis of the lawsuit


2. answer -- filed by the defendant with the core and served on the plaintiff. It usually denies most allegations of the complaint


3. cross-complaint -- filed and served by the defendant if he or she counter sues the plaintiff. The defendant, is the cross-complaint and the plaintiff is the cross-defendant. The cross-defendant must file and serve a reply


4. intervention -- a person who has an interest in a lawsuit may intervene and become a party to the lawsuit


5. consolidation -- separate cases against the same defendant arising from the same incident may be consul dated by the court into one case, if doing so would not cause prejudice to the parties

Discovery -- the pretrial litigation process for discovering facts of the case from the other party and witnesses. Discovery consists of:

1. depositions -- but Worrell testimony given by a deponent, either a party or witness. Depositions are transcribed


2. interrogatories -- these written questions are submitted by one party to the other party. They must be answered within a specific period of time


3. production of documents -- a party to a lawsuit may obtain copies of all relevant documents from the other party


4. physical and mental examination -- these examinations of the party are permitted upon order of the court were injuries are alleged that could be verified or disputed by such examination

Dismissals and Pretrial Judgments

1. motion for summary judgment on the pleadings-- this mission alleges that if all facts as pleaded are true, the meeting party would win the lawsuit. No facts outside the pleadings may be considered


2. motion for summary judgment -- this motion alleges that there are no factual disputes, so the judge may apply the law and decide the case without a jury. Evidence outside the pleadings may be considered such as affidavits, documents, depositions

Settlement Conference

this conference occurs prior to trial between the parties in front of the judge to facilitate the settlement of the case. Also called the pretrial hearing. If settlement is not reached, the case proceeds to trial.

Phases of a Trial

1. jury selection -- occurs through a process called voir dire. Biased jurors are dismissed and replaced.


2. opening statements -- the party's lawyers make opening statements, which are not evidence.


3. the plaintiff's case -- the plaintiff bears the burden of proof. The plaintiff calls witnesses and introduces evidence to try to prove his or her case


4. the defendant's case -- the defendant calls witnesses and introduces evidence to rebut the plaintiff's case and to prove affirmative defense and cross-complaints


5. rebuttal and rejoinder -- the plaintiff and defendant may call additional witnesses and introduce additional evidence


6. closing arguments -- the party's lawyers May closing arguments, which are not evidence.


7. jury instructions -- the judge reads instructions to the jury as to what will they all are to apply to the case


8. jury deliberation -- the jury retires to the jury room and deliberate until it reaches a verdict


9. entry of judgment -- the judge may:
   
   
   
   • enter the verdict reached by the jury as the court's judgment
   
   
   • grant a motion for judgment n.o.v. if the judge finds that the jury was biased. This means the jury's verdict does not stand
   
   
   • order remittitur (reduction) of any damages awarded at the judge finds the jury to be biased or emotional
   
   
   
   

The Appeal

both parties in a civil suit, and the defendant in a criminal trial may appeal the decision of the trial court. Notice of appeal must be filed within a specified period of time. The appeal must be made to the appropriate appellate court.

Alternative Dispute Resolution (ADR)

ADR is a nonjudicial means of solving legal disputes. ADR usually saves time and money compared to litigation.

Types of ADR

1. arbitration -- an impartial third party, called the arbitrator, here's a decides the dispute. The arbitrator makes an award. The award is appealable to a court if the parties have not given up this right. Arbitration is designed by the parties pursuant to:
   
   
   
   • arbitration clause -- agreement contained in a contract stipulating that any dispute arising out of the contract will be arbitrated
   
   
   • submission agreement -- agreement to submit the dispute to arbitration after the dispute arises
   
   
   
   


2. mediation -- a neutral third party, called a mediator, assist the parties and trying to reach a settlement of their dispute. The mediator does not make an award.


3. conciliation -- on and trusted third party, called a conciliator, a the parties in trying to reach a settlement of their dispute. The conciliator does not make an award.


4. minitrial -- a minute trial is a short session in which the lawyers for each side present their cases to representatives of each party who have the authority to settle a dispute.


5. fact-finding -- the parties may hire a neutral third person, called a fact finder, to investigate the dispute and report his or her findings to the adversaries.


6. judicial referee -- with consent of the parties, the court may appoint a judicial referee (usually a retired judge or lawyer) to conduct a private trial and render a judgment. The judgment stands as the judgment of the core and may be appealed to the appropriate appellate court.

 

Contemporary Business and Online Commerce Law - Chapter 2

Contemporary Business and Online Commerce Law

Chapter 2

Constitutional Law for Business and Online Commerce

The Constitution consists of seven articles and 26 amendments. It establishes the three branches of the federal government, enumerates their powers, and provides important guarantees of individual freedom. The Constitution was ratified by the states in 1788.

the U.S. Constitution serves two major functions:

1. creates the three branches of the federal government
   and allocates powers to these three branches
   
   
   
   1. executive
   
   
   2. legislative.
   
   
   3. Judicial branches
   
   
   
   


2. protects individual rights by limiting the government's ability to restrict those rights.

our countries form of government is referred to as federalism. That means that the federal government and the 50 state governments share powers.

Doctrine of Separation of Powers.

1. Article I of the Constitution established, the legislative branch of government. This branch is bicameral; that is, it consists of the Senate and the House of Representatives. Collectively, they are referred to as Congress. Each state has two senators. The number of representatives to the House of Representatives is determined according to the population of each state.


2. Article II of the Constitution establishes the executive branch of government by providing for the election of the president and vice president. The president is not elected by popular vote, but instead is selected by the electoral College, whose representatives are appointed by state delegations.


3. Article III establishes the judicial branch of the government by establishing the Supreme Court in providing for the creation of other federal courts by Congress.

Checks and Balances.

1. the judicial branch has a 42 examined the acts of the other two branches of government determine whether this extraconstitutional.


2. The executive branch can enter into treaties with foreign governments only with the advice and consent of the Senate.


3. The legislative branch is authorized to create federal courts and determine their jurisdiction and to enact statutes that change judicially made law

Supremacy Clause.

the supremacy clause establishes that the federal Constitution, treaties, federal walls, and federal regulations are the supreme law of lien. State and local laws that conflict with valid federal law are unconstitutional. The concept of federal wall taking precedence over state or local law is commonly called the preemption doctrine.

Commerce Clause.

the commerce clause of the U.S. Constitution grants Congress the power to regulate commerce with foreign nations, and among the several states, and with Indian tribes.

Federal Regulation of Interstate Commerce.

the commerce clause also gives the federal government the authority to regulate interstate commerce. Originally, the courts interpreted this clause to mean that the federal government can only regulate commerce that moved in interstate commerce. The modern rule, however, allows the federal government to regulate activities that affect interstate commerce.

under the effects of interstate commerce test, the regulated activity does not itself have to be in interstate commerce. Thus, any local activity that has an effect on interstate commerce is subject to federal regulation.

State and Local Government Regulation of Business -- State "police power"

the state did not delegate all power to regulate business in federal government. They retain the power to regulate intrastate and much interstate business activity that occurs within their borders. This is commonly referred to as state's police power.

police power permits states to enact laws to protect and promote the:

• public-health


• safety


• morals


• and general welfare

this includes the authority to enact laws to regulate the conduct of business:

• zoning ordinances


• state environmental laws


• Corp. and partnership laws


• property laws.

state and local laws cannot unduly burden interstate commerce. If they do, they are unconstitutional because they violate the Commerce Clause.

Bill of Rights

The Bill of Rights guarantees certain fundamental rights to natural persons and protects those rights from intrusive government action. Most of these rights have also been found applicable to so-called artificial persons (example corporations).

17 other amendments have been added to the Constitution.

amendments to the Constitution that are most applicable to business are:

Freedom of Speech

when the most honored freedoms guaranteed by the Bill of Rights is the freedom of speech of the First Amendment. The First Amendment's freedom of speech clause protects speech only, not conduct. The US Supreme Court places speech into three categories:

1. fully protected


2. Ltd. protected


3. unprotected speech

Freedom of Religion.

the U.S. Constitution requires federal, state, and local governments to be neutral toward religion. The First Amendment actually contains two separate religion clauses. They are:

1. The Establishment Clause -- prohibits the government from either establishing a state religion or promoting one religion over another.


2. The Free Exercise Clause -- prohibits the government from interfering with the free exercise of religion in the United States.

The Equal Protection Clause

The equal protection clause provides that a state cannot deny any person within its jurisdiction the equal protection of the laws. Although this clause expressly applies to state and local government action, the Supreme Court has held that it also applies to the federal government action. Artificial persons, such as corporations are also protected. This clause is designed to prohibit invidious discrimination.

The Supreme Court has adopted three different standards for reviewing equal protection cases. They are:

1. Strict scrutiny test. -- any government activity or regulation that classifies persons based on a suspect class is reviewed for lawfulness using a strict scrutiny test.


2. Intermediate scrutiny test -- the lawfulness of government classifications based on protected classes other than race (such as sex or age) are examined using an intermediate scrutiny test


3. Rational basis test -- the lawfulness of all government classifications that do not involve suspect or protected classes is examined using a rational basis test

Due Process Clause

These clauses provide that no person shall be deprived of "life, liberty, or property." Without due process of law. The government is not prohibited from taking a person's life, liberty, or property. However, the government must follow due process to do so.

There are two categories of due process:

1. Substantive Due Process -- requires that government statutes, ordinances, regulations, and other laws be clear on their face and not overly broad in scope. The test of whether substantive due process is met is whether a reasonable person can understand the wall enough to be able to comply with it. Laws that do not meet this test are declared void for vagueness.


2. Procedural Due Process -- requires that the government give a person proper notice and hearing of legal action before that person is deprived of his or her life, liberty, or property.

Privileges and Immunities Clause

this clause prohibits states from enacting laws that unduly discriminate in favor of the residents over residents of other states.

 

 

 

Contemporary Business and Online Commerce Law - Chapter 1

Contemporary Business and Online Commerce Law
Chapter 1.

Legal heritage and critical legal thinking.
The United States is primarily based on English common law influenced by Spanish and French civil law. The sources of law in this country are the U.S. Constitution, state constitutions, federal and state statutes, ordinances, administrative agency rules and regulations, executive orders, and judicial decisions by federal and state courts.
Businesses are subject to the laws of the countries they do business in.

Definition of law
Law is a body of rules of action or conduct that has binding legal force. Laws must be obeyed by citizens subject to sanction or legal consequences

Functions of the Law

The primary functions served by the law in this country are:

• keeping the peace, which includes making certain activities crimes.
• Shaping moral standards, and (enacting laws that discourage drug and alcohol abuse).
• Promoting social justice (enacting statutes that prohibit discrimination in employment).
• Maintaining the status quo (passing laws preventing the forceful overthrow of the government).
• Facilitating orderly change (passing statutes only after considerable study, debate, and public input).
• Facilitating planning (well-designed commercial walls allow businesses to plan activities, allocate their productive resources, and assesses the risks they take).
• Provide a basis for compromise (approximately 90% of all the lawsuits are settled prior to trial).
• Maximizing individual freedom (the rights of freedom of speech, religion, and association granted by the First Amendment of the U.S. Constitution).

Flexibility and fairness of the law.

• Flexibility -- the law must be flexible to meet social, technological, and economic changes in the United States and the world.
• Fairness -- although the US legal system is one of the fairest and most democratic systems of law, abuses of process and mistakes in the application of the law do occur

Schools of Jurisprudential Thought

The philosophy or science of the law is referred to as jurisprudence.

Legal philosophies can generally be grouped into the major categories that follow:

• Natural law -- based on what is "correct". It emphasizes a moral theory of law -- that is, law should be based on morality and ethics.
• Historical -- believes that law is an aggregate of social traditions and customs.
• Analytical -- maintains that law is shaped by logic.
• Sociological -- asserts that the wall is a means of achieving in advancing certain sociological needs.
• Command -- believe that the law is a set of rules developed, communicated, enforced by the ruling party.
• Critical legal studies -- maintains that legal rules are unnecessary and that legal disputes should be solved by applying arbitrary rules based on fairness.
• Law of economics -- believes that promoting market efficiency should be the central concern of legal decision-making

Constitutions.
The U.S. Constitution established the structure of the federal government. It created the following three branches of government gave them the following powers:

• Legislative (Congress): power to make or enact the law.
• Executive (President): power to enforce the law.
• Judicial (courts): power to interpret and determine the validity of the law.

Powers not given to the federal government by the Constitution reserved for the state. Have their own constitutions. State constitutions established the legislative, executive, and judicial branches of state government and establish the powers of each branch. Provisions of state constitutions are valid unless they conflict with the U.S. Constitution or any valid federal law.

Treaties.

The U.S. Constitution provides that the president, with the advice and consent of two thirds of the Senate, may enter into treaties with foreign governments. Treaties become part of the supreme law of the land.

Codified Law.
Statutes are written laws that established courses of conduct that must be adhered to by covered parties.

Federal statutes include:

• antitrust laws
• security laws
• bankruptcy laws
• labor laws
• equal employment opportunity laws
• environmental protection laws
• consumer protection laws
• and more

State statutes include:

• corporation laws
• partnership laws
• workers compensation laws
• Uniform Commercial Code

The statutes enacted by the legislative branches of the federal and state governments are organized by topic into code books. This often called codified law.

State legislatures, often delegate lawmaking authority to local government bodies:

• cities.
• Municipalities.
• Countries.
• School districts.
• Water districts.
• And so forth.

These governmental units are empowered to adopt ordinances. Examples:

• traffic laws.
• Local building codes.
• Zoning laws.
  Ordinances are also codified.

Concept summary -- sources of laws in the United States.

• Constitutions -- the U.S. Constitution establishes the federal government, and enumerates its powers. Powers not given to the federal government are reserved to the states. State constitutions as establish state governments and enumerate their powers.
• Treaties -- the president, with the advice and consent of the Senate, may enter into treaties with foreign countries.
• Codified law/statutes and ordinances -- statutes are enacted by Congress and state legislatures. Ordinances all are enacted by municipalities and local government agencies. They established courses of conduct that covered parties must follow.
• Administrative agency rules and regulations -- administrative agencies are created by the legislative and executive branches of government. They may adopt rules and regulations that regulate the conduct of covered parties.
• Executive orders -- issued by the president and governors of states, executive orders regulate the conduct of covered parties.
• Judicial decisions -- courts decide controversies. In doing so, a core issues decisions that state. The holding of the case and the rationale, the court used in reaching that decision.
  

Plaintiff -- the party who originally brought the lawsuit.
Defendant -- the party in the lawsuit has been brought.
Petitioner or appellant -- the party who has appealed the decision of the trial court were low work work. The petitioner may be either the plaintiff or the defendant, depending on who lost the case at the trial court or lower court level.
Respondent or appellee -- the party who must answer the petitioners appeal. The respondent may either be the plaintiff or the defendant, depending on which party is the petitioner. In some cases, both the plaintiff and the defendant may disagree with the trial courts or lower court's decision, and both parties may appeal the decision.

International Business Chapter 3 - Politics and Law - Summary

Chapter 3 - Politics and Law - Summary

Political systems

A political system consists of the structures, processes, and activities by which a nation governs itself. In a democratic system, leaders are elected directly by the wide participation of the people or the people's representatives. Most democracies take the form of a representative democracy, in which citizens nominate individuals from their groups to represent them.

In a totalitarian system, individuals govern without the people support, maintain control over most aspects of people's lives, and do not tolerate opposing viewpoints. Under a theocratic totalitarianism, countries religious leaders enforce laws and regulations based on religious and totalitarian beliefs. Under secular totalitarianism, political leaders rely on military and bureaucratic power.

Secular totalitarianism takes three forms. Under Communist totalitarianism, the government aims for social equality by cleaning economic activity. Under tribal totalitarianism, one tribe imposes its will on others in the country. Right-wing totalitarianism is capitalist economics without political freedom.

Managers can reduce effects of political risk.

Political risk is the likelihood that a government or society will undergo political changes that negatively affect business activity.

Political risk arises from:

• corrupt or poor political leadership
• frequent changes in the form of government
• political involvement of religious or military leaders
• unstable political systems
• conflict among races, religions, or ethnic groups
• poor relations with other countries

Macro risk threatens all companies in a nation regardless of the industry. Micro risk threatens firms in a particular industry or smaller groups.

There are five main forms of political risk:

1. conflict and violence
2. terrorism and kidnapping
3. property seizure
4. policy changes
5. local content requirements

Property seizure -- the taking of company assets by a local government -- may take one of three forms

1. confiscation
2. expropriation
3. nationalism

The main strategies used to manage political risk are:

• adaptation -- incorporating risk into business strategy
• information gathering -- monitoring local political events
• political influence -- such as lobbying local political leaders

Legal systems

a legal system is a countries set of laws and regulations, including the processes by which its laws are enacted and enforced in the way in which its courts hold parties accountable for their actions. There are three categories of legal systems. Under common law, the justice system decides cases by interpreting the law on the bases of tradition, precedent, and usage. Civil law is based on a detailed set of written rules and statutes that constitute a legal code. All obligations, responsibilities, and privileges follow directly from the written code. Theocratic law is based on religious teachings.

National companies face legal and ethical issues

although there is no well-defined body of international law, some efforts are being made to achieve standardization -- uniformity in interpreting and applying laws and more than one country.

Chief legal issues facing international businesses are:

• protection of property rights
• protection of intellectual property
• product liability standards
• taxation policies
• antitrust regulations
• ethical dilemmas and social responsibility

International relations

Political relations between a company's home country and those with which it does business strongly affect its international activities. In general, favorable political relations lead to increased opportunity and stable business environments. The mission of the United Nations is to provide leadership and fostering peace and stability around the world. Although its global peacekeeping efforts have had mixed results, it's many agencies continue to aid poorer nations by providing food and medical supplies, educational supplies and training, and financial resources.

International Business Chapter 3 - Politics and Law - terms

Chapter 3 - terms

Political system -- structures, processes, and activities by which a nation governs itself
democracy -- a political system in which government leaders are elected directly by the white participation of the people or by their representatives
Representative democracy -- democracy in which citizens elect individuals from their groups to represent their political needs and views
private sector -- segment of the economic environment comprising independently and firms that exist to make a profit
totalitarian system -- political system in which individuals govern without the support of the people, government maintains control over many aspects of people's lives, and leaders do not tolerate opposing viewpoints
theocracy -- political system in which a country's political leaders are religious leaders who enforce laws and regulations based on religious beliefs
theocratic totalitarianism -- political system in which religious leaders govern without the support of the people and did not tolerate opposing viewpoints
secular totalitarianism -- political system in which leaders rely on military and bureaucratic power
Communism -- the belief that social and economic equality can be obtained only by establishing on all powerful Communist Party and by granting the government ownership and control over all types of economic activities
Socialism -- the belief that social and economic equality is obtained through government ownership in regulation of the means of production
capitalism -- the belief that ownership of the means of production belongs in the hands of individuals and private businesses
political risk -- likelihood that a government or society will undergo political changes that negatively affect local business activities
confiscation -- forced transfer of assets from a company to the government without compensation
expropriation -- forced transfer of assets from a company to the government with compensation
nationalization -- government takeover of an entire industry
local content requirements -- laws stipulating that a specified amount of a good or service be supplied by producers and the domestic market
lobbying -- policy of hiring people to represent a company's views on political matters
Foreign Corrupt Practices Act -- 1977 statute for baiting US companies from bribing government officials or political candidates and other nations
legal system -- set of laws and regulations, including the processes by which a country's walls or enacted and enforced in the ways in which its courts hold parties accountable for their actions
e-government -- use of information technology and e-commerce techniques that allow citizens and businesses to access government information and obtaine public services
nationalism -- devotion of a people to their nation's interests and advancement
common law -- legal system based on a country's legal history (tradition), passed cases that have come before its courts (precedent), and the ways in which laws are applied in specific situations (usage)
civil law -- legal system based on a detailed set of written rules and statutes that constitute a legal code
theocratic law -- legal system based on religious teachings
intellectual property -- property that results from People's intellectual talent and abilities
property rights -- legal rights to resources and any income they generate
industrial property -- patents and trademarks
patents -- property right granted to the inventor of a product or process that excludes others from making, using, or selling the invention
trademark -- property right in the form of words or symbols that distinguish a product in its manufacture
copyright -- property right giving creators of original works the freedom to publish or dispose of them as they choose
Berne Convention -- international treaty that protects copyrights
product liability -- responsibility of Manufacturers, sellers, and others for damage, injury, or death caused by defective products
value added tax (VAT) -- tax levied on each party that adds value to a product throughout its production and distribution
antitrust (anti-monopoly) laws -- laws designed to prevent companies from fixing prices, sharing markets, in gaining unfair monopoly advantages
ethical behavior -- personal behavior that is in accordance with rules and standards for right conduct or morality
social responsibility -- practice of companies going beyond legal obligations to actively balance commitments to investors, customers, other companies, and communities
United Nations (UN) -- international organization formed after World War II to provide leadership in fostering peace and stability around the world

Chapter 2 - Cross-Culture - summary

Chapter 2international business
cross-cultural business

The significance of natural culture and subcultures.

Culture is the set of values,beliefs, rules, and institutions held by a specific group of people. Successfully dealing with members of other cultures means avoiding ethnocentricity (the tendency to view one's own culture as superior to others) and developing cultural literacy (gaining the detailed knowledge necessary to function effectively in another culture).

We are conditioned to think in terms of national culture -- that is, to equate a nation-state and its people with a single culture. Nations are firm the importance of national culture by building museums and monuments to preserve national legacies. Nations also intervene in business to help protect the national culture from unwanted influence of other cultures. Most nations are also home to numerous subcultures -- groups of people who share a unique way of life within a larger, dominate culture. Subcultures contribute greatly to national culture and must be considered in marketing and production decisions.

Components of culture impact business activities around the world.

Culture includes a people's beliefs and traditional habits and the ways in which they relate to one another. These factors fall into one or more of the eight major components of culture.

The eight major components of culture:

1. aesthetics
2. values and attitudes
3. Manners and customs
4. social structure
5. religion
6. personal communication
7. education
8. physical and material environments

Each of these components affects business activities.

Aesthetics can determine which callers and symbols will be effective, or offensive, in advertising.

Values influence a person's attitudes toward time, work and achievement, and cultural change.

Knowledge of manners and customs is necessary for negotiating with people of other cultures, marketing products to them, and managing operations and their country.

Social structure affects business decisions ranging from production site selection to advertising methods to the costs of doing business in the country.

Different religions take different views of work, savings, and material goods.

Understanding a people's system of personal communication provides insight into their values and behavior.

A cultures education level affects the quality of the workforce and standard of living.

The physical and material environments influence work habits and preferences regarding products such as clothing and food.

Cultural change

cultural change occurs when a people integrate into their culture the gestures, material objects, traditions, or concepts of another culture through the process of cultural diffusion. Globalization and technology are increasing the pace of cultural change around the world. Companies can influence culture when they import business practices or products into the host country. In order to avoid changes of cultural imperialism, they should import new products, policies, and practices during times of stability. Culture is also affect management styles, work scheduling, and reward systems. Adapting to local cultures around the world means heeding the maxim "Think globally, act locally."

Physical environment and technology influence culture.

A people's physical environment includes topography and climate and the ways (good and bad) in which they relate to their surroundings. Cultures isolated by topographical barriers, such as mountains or seas, normally change relatively slowly, and their languages are often distinct. Climate affects the hours of the day people work. For example, people in hot climates normally take siestas when afternoon temperatures soar. Climate also influences customs, such as the type of clothing a people we are and the types of food they eat.

Material culture refers to all the technology that people used to manufacture goods and provide services. It is often used to measure the technological advancement of a nation. Business people often use this measure to determine whether a market has developed adequate demand for a company's products and whether it can support production activities. Material culture tends to be uneven across most nations.

Culture frameworks.

There are two widely accepted frameworks for studying cultural differences.

The Kluckhohn-Strodtbeck framework compares cultures among six dimensions by seeking answers to certain questions, including: do people believe that their environment controls them or vice versa? Do people focus on past events for the future? Do they preferred to conduct activities in public or private?

The Hofstede framework develops four dimensions, such as individualism versus collectivism and equality versus inequality. Understanding a cultures orientation regarding these four dimensions helps companies increase their chance of success. Taken together, these frameworks help companies to understand many aspects of a people's culture including risk-taking, innovation, job mobility, team cooperation, pay levels, and hiring practices.