Gale Encyclopedia Of American Law 3Rd Edition Volume 10 P18 pps

distributor all frequently reduce their relation- ships to contractual terms. These contractual relationships create an expectation of mutual performance—that each party will perform its part under the contract’s terms. Protection of these relationships from outside interference facilitates performance and helps stabilize com- mercial undertakings. Interference with con- tractual relations upsets expectations, destabilizes commercial affairs, and increases the costs of doing business by involving competitors in petty squabbles or litigation. Virtually any contract, whether written or oral, qualifies for protection from unreasonable interference. Noncompetition contracts are a recurrent source of litigation in this area of law. These contracts commonly arise in profes- sional employment settings where an employer requires a skilled employee to sign an agreement promising not to go to work for a competitor in the same geographic market. Such agreements are generally enforceable unless they operate to deprive an employee of the right to meaning- fully pursue a livelihood. An employee who chooses to violate a noncompetition contract is guilty of breach of contract, and the business that lured the employee away may be held liable for interfering with an existing contractual relationship in violation of the law of unfair competition. Informal trade relations that have not been reduced to contractual terms are also protected from outside interference. The law of unfair competition prohibits businesses from inten- tionally inflicting injury upon a competitor’s informal business relations through improper means or fo r an improper purpose. Improper means include the use of violence, UNDUE INFLUENCE , and coercion to threaten competitors or intimidate customers. For example, it is illegal for a business to blockade the entryway to a competitor’s shop or impede the delivery of supplies with a show of force. The mere refusal to deal with a competitor, however, is not considered an improper means of competition, even if the refusal is motivated by spite. Any malicious or monopolistic practice aimed at injuring a competitor may constitute an improper purpose of competition. Monopo- listic behavior includes any agreement between two or more people that has as its purpose the exclusion or reduction of competition in a given market. The SHERMAN ANTI-TRUS T ACT OF 1890 (15 U.S.C.A. §§ 1 et seq.) makes such behavior illegal by forbidding the formation of contracts, combinations, and conspiracies in restraint of trade. Corporate MERGERS AND ACQUISITIONS that suppress competition are prohibited by the CLAYTON AC T of 1914, as amended by the ROBINSON-PATMAN ACT of 1936 (15 U.S.C.A. §§ 12 et seq.). The Clayton Act also regulates the use of predatory pricing, tying agreements, and exclu- sive dealing agreements. Predatory pricing is the use of below-market prices to inflict pecuniary injury on competitors. A tying agreement is an agreement in which a vendor agrees to sell a particular good on the condition that the vendee buy an additional or “tied” product. Exclusive dealing agreements require vendees to satisfy all of their needs for a particular good exclusively through a designated vendor. Although none of these practices is considered inherently illegal, any of them may be deemed improper if it manifests a tendency to appreciably restrain competition, substantially increase prices, or significantly reduce output. Trade Name, Trademark, Service Mark, and Trade Dress Infringement Before a business can establish commercial relations with its customers, it must create an identity for itself, as well as for its goods and services. Economic competition is based on the premise that consumers can distinguish between products offered in the marketplace. Competi- tion is made difficult when rival products become indistinguishable or interchangeable. Part of a business’s identity is the good will it has established with consumers, while part of a product’s identity is the reputation it has earned for quality and value. As a result, businesses spend tremendous amounts of resources to identify their goods, distinguish their services, and cultivate good will. The four principal devices businesses use to distinguish themselves are trade names, trade- marks, service marks, and trade dress. Trade names are used to identify corporations, partner- ships, sole proprietorships, and other business entities. A TRADE NAME may be the actual name of a business that is registered with the government, or it may be an assumed name under which a business operates and holds itself out to the public. For example, a HUSBAND AND WIFE might register their business under the name “Sam and Betty’s Bar and Grill,” while doing business as “The Corner Tavern.” Both names are GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION 158 UNFAIR COMPETITION considered trade names under the law of unfair competition. Trademarks consist of words, symbols, emblems, and other devices that are affixed to goods for the purpose of signifying their authenticity to the public. The circular emblem attached to the rear end of vehicles manufac- tured by Bavarian Motor Works (BMW) is a familiar example of a TRADEMARK designed to signify meticulous craftsmanship. Whereas tra- demarks are attached to goods through tags and labels, service marks are generally displayed through advertising. As their name suggests, service marks identify services rather than goods. Orkin pest control is a well-known example of a SERVICE MARK. Trade dress refers to a product’s physical appearance, including its size, shape, texture, and design. Trade dress can also include the manner in which a product is packaged, wrapped, pre- sented, or promoted. In certain circumstances particular color combinations may serve as a company’s trade dress. For example, the trade dress of Chevron Chemical Company includes the red and yellow color scheme found on many of its agricultural products (Chevron Chemical Co. v. Voluntary Purchasing Groups, Inc., 659 F.2d 695 [5th Cir. 1981]). To receive protection from infringement, trade names, trademarks, service marks, and trade dress must be distinctive. Generic lan- guage that is used to describe a business or its goods and services rarely qualifies fo r protec- tion. For example, the law would not allow a certified public accountant to acquire the exclusive rights to market his business under the name “Accounting Services.” Such a name does nothing to distinguish the services offered by one accountant from those offered by others in the same field. A court would be more inclined to confer protection upon a unique or unusual name like “Accurate Accounting and Actuarial Acumen.” When competitors share deceptively similar trade names, trademarks, service marks, or trade dress, a cause of actio n for infringement may exist. The law of unfair competition forbids competitors from confusing consumers through the use of identifying trade devices that are indistinguishable or difficult to distinguish. Actual confusion need not be demonstrated to establish a claim for infringement, so long as there is a likelihood that consumers will be confused by similar identifying trade devices. Greater latitude is given to businesses that share similar identifying trade devices in unrelated fields or in different geographic markets. For example, a court would be more likely to allow two businesses to share the name “Hot Hand- guns,” where one business sells firearms down- town, and the other business runs a country western theater in the suburbs. Claims for infringement are cognizable under both state and federal law. At the federal level, infringement claims may be brought under the Lanham Trademar k Act (15 U.S.C. A. §§ 1051 et seq.). At the state level, claims for infringement may be brought under analogous INTELLECTUAL PROPERTY statutes and miscellaneous common-law doctrines. Claims for infringement can be strengthened through registration. The first business to register a trademark or a service mark with the federal government is normally protected against any subsequent appropriation by a competitor. Although trade names may not be registered with the federal government, most states require businesses to register their trade names, usually with the SECRETARY OF STATE, and provide protection for the first trade name registered. Trade dress typically receives legal protection by being distinctive and recognizable without any formal registration requirements at the state or federal level. Theft of Trade Secrets and Infringement of Copyrights and Patents The intangible assets of a business include not only its trade name and other identifying devices but also its inventions, creative works, and artistic efforts. Broadly defined as trade secrets, this body of commercial information may consist of any formula, pattern, process, program, tool, technique, mechanism or com- pound that provides a business with the opportunity to gain advantage over competitors. Although a TRADE SECRET is not patented or copyrighted, it is entrusted only to a select group of people. The law of unfair competition awards individuals and businesses a property right in any valuable trade information they discover and attempt to keep secret through reasonable steps. The owner of a trade secret is entitled to its exclusive use and enjoyment. A trade secret is valuable not only because it enables a company GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION UNFAIR COMPETITION 159 to gain advantage over a competitor but also because it may be so ld or licensed like any other property right. In contrast, commercial infor- mation that is revealed to the public, or at least to a competitor, retains limited commercial value. Consequently, courts vigilantly protect trade secrets from disclosure, appropriation, and theft. Businesses or opportunistic members of the general public may be held liable for any economic injuries that result from their theft of a trade secret. Employees may be held liable for disclosing their employer’s trade secrets, even if the disclosure occurs after the employment relationship has ended. Valuable business information that is dis- closed to the public may still be protect ed from infringement by COPYRIGHT and patent law. Copyright law gives individuals and businesses the exclusive rights to any original works they create, including movies, books, musical scores, sound recordings, dramatic creations, and pantomimes. Patent law gives individuals and businesses the right to exclude all others from making, using, and selling specific types of inventions, such as mechanical devices, manu- facturing processes, chemical formulas, and electrical equipment. Federal law grants these exclusive rights in exchange for full public disclosure of an original work or invention. The inventor or author receives complete legal protec- tion for her intellectual efforts, while the public obtains valuable information that can be used to make life easier, healthier, or more pleasant. Like the law of trade secrets, patent and copyright law offers protection to individuals and businesses that have invested considerable resources in creating something useful or valu- able and wish to exploit that investment com- mercially. Unlike trade secrets, which may be protected indefinitely, patents and copyrights are protected only for a finite period of time. Applications for copyrights are governed by the Copyrights Act (17 U.S.C.A. § 401), and patent applications are governed by the Patent Act (35 U.S.C.A. § 1). False Advertising, Trade Defamation, and Misappropriation of a Name or Likeness A business that successfully protects its creative works from theft or infringement may still be harmed by FALSE ADVERTISING. Advertisin g need not be entirely false to be actionable under the law of unfair competition, so long as it is sufficiently inaccurate to mislead or deceive consumers in a manner that inflicts injury on a competitor. In general, businesses are prohib- ited from placing ads that either unfairly disparage the goods or services of a competitor or unfairly inflate the value of their own goods and services. False advertising deprives con- sumers of the opportunity to make intelligent comparisons between rival products. It also drives up costs for consumers who must spend additional resources in examining and sampling products. Both federal and state laws regulate decep- tive advertising. The Lanham Trademark Act regulates false advertising at the federal level. Many states have adopted the Uniform Decep- tive Trade Practices Act, which prohibits three specific types of representations: (1) false representations that goods or services have certain characteristics, ingredients, uses, bene- fits, or quantities; (2) false representations that goods or services are new or original; and (3) false representations that goods or services are of a particular grade, standard, or quality. Advertisements that are only partially accurate may give rise to liability if they are likely to confuse prospect ive consumers. Ambiguous representations may require clarification to prevent the imposition of liability. For example, a business that accuses a competitor of being “untrustworthy” may be required to clarify that description with additional information if consumer confusion is likely to result. Trade DEFAMATION is a close relative of false advertising. The law of false advertising reg- ulates inaccurate representations that tend to mislead or deceive the public. The law of trade defamation regulates communications that tend to lower the reputation of a business in the eyes of the community. Trade defamation is divided into two categories: LIBEL AND SLANDER. Trade libel generally refers to written communications that tend to bring a business into disrepute, whereas trade slander refers to defamatory oral communications. Before a business may be held liable under either category of trade defamation, the FIRST AMEND- MENT requires proof that a defamatory statement was published with “actual malice,” which the Supreme Court defines as any representation that is made with knowledge of its falsity or in reckless disregard of its truth ( NEW YORK TIMES V. SULLIVAN, 376 U.S. 254, 84 S. Ct. 710, 11 L. Ed. GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION 160 UNFAIR COMPETITION 2d 686 [1964]). The actual malice standard places some burden on businesses to verify, prior to publication, the veracity of any attacks they level against competitors in print or electronic media. It is also considered tortious for a business to use the name or likeness of a famous individual for commercial advantage. All individuals are vested with an exclusive property right in their identity. No person, business, or other entity may appropriate an individual’s name or likeness without permission. Despite the existence of this common-law TORT, businesses occasionally asso- ciate their products with popular celebrities without first obtaining consent. A business that falsely suggests that a celebrity has sponsored or endorsed one of its products will be held liable for money damages equal to the economic gain derived from the wrongful appropriation of the celebrity’slikeness. A Simpler Definition The law of unfair competition includes several related doctrines. Nevertheless, some courts have attempted to simplify the law by defining unfair competition as any trade practice whose harm outweighs its benefits. The U.S. legal system is a cornerstone of the free enterprise system. But the freedom to compete does not imply the right to engage in predatory, mono- polistic, fraudulent, deceptive, misleading, or unfair competition. On balance, competition becomes unfair when its effects on trade, con- sumers, and society as a whole are more detri- mental than beneficial. FURTHER READINGS American Law Institute. 1995. Restatement (Third) of Unfair Competition. New York: American Law Institute. Ginsburg, Jane C., and Jessica Litman. 2007. Trademark and Unfair Competition Law: Cases and Materials. New York: Foundation Press. Goldstein, Paul, and Edmund W. Kitch. 2003. Unfair Competition, Trademark, Copyright, and Patent. New York: Foundation Press. Reed, Chris. 1998. “Controlling World Wide Web Links: Property Rights, Access Rights and Unfair Competi- tion.” Indiana Journal of Global Legal Studies 6 (fall). Sanders, Anselm Kamperman Sanders. 1997. Unfair Com- petition Law: The Protection of Intellectual and Industrial Creativity. New York: Oxford Univ. Press. Shilling, Dana. 2002. Essentials of Trademarks and Unfair Competition. New York: John Wiley. CROSS REFERENCES Antitrust Law; Lanham Act; Monopoly; Noncompete Agreement; Tying Arrangement. UNFAIR LABOR PRACTICE Conduct prohibited by federal law regulating relations among employers, employees, and labor organizations. Before 1935 U.S. LABOR UNIONS received little protection from the law. Employers used many tactics to prevent employees from joining unions and to disrupt union activities in the workplace. The passage of the National Labor Relations Act (NLRA) of 1935, also known as the WAGNER ACT (29 U.S.C.A. § 151 et seq.), marked the beginning of affirmative federal government support of unionization and COLLECTIVE BARGAINING. The NLRA prohibits employers from taking certain actions against their employees and the unions that represen t them. A prohibited action is called an “unfair labor practice.” Section158 ofthe NLRAlistsemployer actions that constitute such practices. Section 158(a)(1) prohibits employers from interfering with the rights of employees to establish, belong to, or aid labor organizations; to conduct collective bar- gaining through the employees’ chosen represen- tatives; and to participate in concerted activities, such as strikes, for the purpose of collective bargaining or other mutual aid or protection. Section 158(a)(3) outlaws employer-formed or -dominated “company unions.” Section 158 (a)(3) forbids employers to discriminate in hiring, firing, and other aspects of employment on the basis of union activity. Section 158(a)(4) prohibits firing or discriminating against any employee because he has filed charges or testified before the agency charged with enforcing the statute. Section 158(a)(5) requires employers to engage in collective bargaining with employee representatives. The NLRA proved to be an effective tool for labor unions. Union membership and economic power grew so rapidly between 1935 and 1945 that the business community complained that unions were abusing their new strength. As a result, in 1947 Congress passed the TAFT-HARTLEY ACT , also known as the LABOR-MANAGEMENT RELA- TIONS ACT (29 U.S.C.A. § 141 et seq.), which amended the NLRA by prohibiting certain union activities as unfair labor practices. These activities include secondary boycotts (boycotts against the employer’s customers or suppliers), jurisdictional strikes over work assignments, strikes to force an employer to discharge an employee on account of union affiliation or lack of it, disparaging an employer’s product, GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION UNFAIR LABOR PRACTICE 161 disloyalty, sit-down strikes, work disruptions, and the release of confidential information. The NLRA also established the NATIONAL LABOR RELATIONS BOARD (NLRB) as an ADMINISTRA- TIVE AGENCY to administer and interpret the unfair labor practice provisions. The NLRB hears allegations of unfair labor practices and makes rulings, which may be appealed in the federal courts. CROSS REFERENCES Labor Law; Labor Union. UNIFORM ACTS Laws that are designed to be adopted generally by all the states so that the law in one jurisdiction is the same as in another jurisdiction. Uniform acts or laws are prepared and sponsored by the National Conference of Commissioners on Uniform State Laws, whose members are experienced lawyers, judges, and professors of law generally appointed to the commission by state governors. Uniform acts or laws are adopted, in whole or substantially, by individual states at their option. Uniform laws are intended to promote fairness through the equal operation of standards upon the citizens of all states without distinction or DISCRIMINA- TION . One uniform law, the Uniform Controlled Substances Act, is a comprehensive law that governs the use, sale, and distribution of DRUGS AND NARCOTICS in most states. Similar to uniform acts, MODEL ACTS or laws are proposed by the Commissioners as guideline legislation for individual states to adapt and modify to meet their specific needs. Uniform acts are intended to be used as written. CROSS REFERENCE Model Acts. Banning the Permanent Replacement of Economic Strikers: Fair or Unfair? T he National Labor Relations Act (NLRA) of 1935, also known as the Wagner Act (29 U.S.C.A. § 151 et seq.), affirms the right of employees to strike in order to force an employer to provide better wages or working conditions. Workers who strike for economic gain may be permanently replaced by the employer, however, as long as the replace- ment workers do not receive better terms than those offered to the strikers. The NLRA prohibits the replacement of work- ers who strike to protest an unfair labor practice. Unions have long sought to amend the NLRA to prohibit the permanent replacement of striking workers in all strikes, not just unfair labor practice strikes. They see the use of permanent replacement workers as the ultimate unfair labor practice and argue that it gives the employer disproportionate bar- gaining power in labor-management negotiations over wages and working conditions. Meanwhile employers contend that banning permanent replacement workers would give unions too much power and would cripple U.S. business. Legislation that would ban perma- nent replacement workers has been defeated repeatedly in Congress. After the last congressional defeat of such legislation, President Bill Clinton issued Executive Order No. 12,954 on March 8, 1995 (60 FR 13023). This order barred businesses that permanently replace strik- ing workers from receiving federal con- tracts. The president concluded that the hiring of permanent replacements esca- lated labor disputes and led to longer strikes, both of which are contrary to sound labor policy. A coalition of business groups im- mediately challenged the order. In Chamber of Commerce of the United States v. Reich, 74 F.3d 1322 (D.C. Cir. 1996), a three-judge federal appeals panel struck down the executive order, ruling that federal labor law preempted executive action. Efforts by some state legislatures to ban permanent replacement workers have also been struck down on the basis that the NLRA preempts state action. Union leaders continue to seek modification of the NLRA. The leaders of big industrial unions blame the loss of some strikes on the hiring of permanent replacements. Though employers have had the right to hire permanent replace- ments for decades, the unions contend that employers have only used this type of hardball tactic on a consistent basis since the 1980s. According to the unions, the loss of strikes because of this tactic has demoralized their members and put unions on the defensive in wage and working condition negotiations. Unions argue that it is unfair for U.S. workers to lose their jobs when they exercise the fundamental right to strike. The hiring of permanent replacements is a strikebreaking tactic that undermines GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION 162 UNIFORM ACTS UNIFORM CODE OF MILITARY JUSTICE The Uniform Code of Military Justice (UCMJ) (10 U.S.C.A. § 801 et seq.) was enacted by Congress in 1950 to establish a standard set of procedural and substantive criminal laws for all the U.S. military services. (It went into effect the following year.) The UCMJ applies to all members of the military, including those on active duty, students at military academies, prisoners of war, and, in some cases, retired or reserve personnel. The UCMJ changed MILITARY LAW in several ways, especially by providing substantial procedural safeguards for an accused, such as the right to be represented by counsel, to be informed of the nature of the accusation, to remain silent, and to be told of these rights. MILITARY LAW exists separately from civilian law. The rights of individuals serving in the ARMED SERVICES are not as extensive as civilians’ rights because the military is regulated by the overriding demands of discipl ine and duty. Recognizing this nee d for a separate body of regulations to govern the military, Article I, Section 8, Clause 14, of the Constitution empowers Congress “to make Rules for the Government and Regulation of the land and naval Forces.” Until the enactment of the UCMJ , the Army and Navy each had its own system of military justice, known as the ARTICLES OF WAR in the Army and the Articles for the Gover nment of the Navy. The UCMJ ensures that any accused member of the armed services will be subject to the same substantive charges and procedural rules and that he or she will be guaranteed identical procedural safeguards . Some provisions of the UCMJ concern COMMON LAW crimes, such as MURDER, RAPE, the collective bargaining process set out by the NLRA by ultimately giving employ- ers the upper hand in negotiations. An employer’s express or implied threat to hire permanent replacements also threa- tens union solidarity, as members ques- tion the wisdom of going on strike. In addition, unions are concerned that the hiring of permanent replace- ments can result in the demise of the union at the company that has been struck. Replacement workers, who are subjected to the threats and taunts of strikers, are unlikely to join the union at some future time. Thus, the employer not only prevails in a labor strike but also secures a nonunion workforce. Apart from the effect on union- management relations and bargaining power, supporters of a ban on permanent replacements contend that consumers are hurt by such hiring. They argue that permanent replacements threaten the reliability and quality of products because those workers are less experienced and cannot perform as well as those with longtime service to a company. U.S. businesses, however, believe strongly in the right to hire permanent replacement workers. They reject the idea that hiring temporary replacement workers during a strike is a viable option. Temporary replacements must be fired after an economic strike has been settled because union workers are entitled to reclaim their jobs. Employers point out that temporary workers require a sub- stantial investment in training and that it is difficult to promote morale and loyalty among workers whose jobs will end with the resolution of the strike. Employers argue that it is more efficient to hire permanent replacements and provide them with sufficient training to ensure that the quality and reliability of a company’s products will not suffer. Defenders of replacement workers also believe that the right to hire during a strike is essential to the balance that exists between labor and business. The right of labor to strike for better wages and working conditions is matched by the right of business to hire permanent replacements. If permanent replacements were banned, employers would be forced to capitulate to overreaching union eco- nomic demands or face more frequent and crippling strikes. In addition, nonunion employers fear that a ban on replacement workers would give unions more leverage in organizing workers. A union could promise that workers who joined the union would be able to resume their jobs after a strike for economic demands, no matter how excessive. Business leaders also contend that a ban on permanent replacement workers would drive up labor costs, which would be bad for the national economy. A ban would give unions too much power and encourage them to strike. Businesses assert that permitting the hiring of permanent replacements deters unions from striking and leads to more reasonable and pro- ductive collective bargaining. FURTHER READINGS “Preventing Replacement of Economic Strikers.” 1990. Hearing Before the Sub- committee on Labor of the Committee on Labor and Human Resources,United States Senate, One Hundred First Congress, Second Session, on S. 2112 (June 6). Thusing, Gregor, and Sven-Frederik Balders. 2000. “Permanent Replacement of Eco- nomic Strikers in the United States of America and the Federal Republic of Germany: Two Sides of the Same Coin.” Temple International and Comparative Law Journal 14 (spring). GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION UNIFORM CODE OF MILITARY JUSTICE 163 LARCENY, and ARSON. The elements of these offenses do not differ from those in state codes. Other provisions deal with offenses that are unique to the military, including absence offenses, duties-and-orders offenses, superior- subordinate relationship offenses, and combat- related offenses. Absence offenses include absence without leave (art. 86, 10 U.S.C.A. § 886) and desertion (art. 85, 10 U.S.C.A. § 885). These are the most prevalent crimes in the military. Approximately 75 percent of all courts-martial involve charges of being absent without leave under article 86. Duties-and-orders offenses include failure to obey an order or regulation (art. 92, 10 U.S. C.A. § 892) and being intoxicated on duty (art. 112, 10 U.S.C.A. § 912). Superior-subordinate relationship offenses include violations such as CONTEMPT for officials (art. 88, 10 U.S.C.A. § 888) and MUTINY (art. 94, 10 U.S.C.A. § 894). Combat-related offenses include misbehavior before the enemy (art. 99, 10 U.S.C.A. § 899) and misconduct as a prisoner (art. 105, 10 U.S. C.A. § 905). The UCMJ also includes the so-called General Articles (arts. 133 and 134, 10 U.S.C.A. §§ 933, 934), which proscribe certain conduct in nonspecific terms. Article 133 makes unlawful any conduct by an officer that is “unbecoming to an officer and a gentleman.” Article 134 pro- scribes “all disorders and neglects to the preju- dice of a good order and discipline [and] all conduct of a nature to bring discredit upon the armed forces.” The constitutionality of these articles was upheld in the face of a FIRST AMEND- MENT challenge in Parker v. Levy (417 U.S. 733, 94 S. Ct. 2547, 41 L. Ed. 2d 439 [1974]). Article 15 (10 U.S.C.A. § 815) of the UCMJ provides for nonjudicial punishment. Most minor violations of the UCMJ are processed under this article. The accused appears before his commanding officer, who passes judgment and imposes the sentence, if any. The military favors nonjudicial punishment because it gives the commanding officer a direct method of discipline, the process is quick and efficient, and the accused person’s record is not marred by a COURT-MARTIAL conviction. Procedurally, the UCMJ provides for a three-level system of courts that is similar to the structure of civilian courts. Criminal matters are handled by courts-martial, which are analogous to civilian trial courts. There are three types of court-martial: the general court- martial, the special court-martial, and the summary court-martial. A general court-martial is used for serious offenses. The court has five or more members, but a DEFENDANT also has the right to have a military judge hear the case. The PROSECUTOR, defense counsel, and military judge in a general court-martial must be lawyers. The military judge advises the court on matters of law and makes rulings as to the introduction of evidence. A general court-martial may impose any penalty that is authorized by the UCMJ as punishment for the offense. A special court-martial concerns itself with intermediate-level offenses. The court has three or more members, but the defendant may elect to be tried by a military judge. The maximum sentence that may be imposed by a special court- martial is six months of confinement, FORFEITURE of pay, reduction in rank, and a bad-conduct discharge. A summary court-martial may be used only to prosecute enlisted personnel for minor offenses. Only one officer hears the case, and the maximum penalty is confinement for one month, forfeiture of two-thirds of a month’s pay, and reduction in rank. Under the UCMJ, all cases in which the sentence involves death, a punitive discharge, or imprisonment for a term of one year or more must be reviewed by a Court of Criminal Appeals (CCA). A CCA must also affirm any sentence imposed by a court-martial before the sentence can be executed. Each branch of the armed services has its own CCA. Generally, a three-judge panel reviews court-martial convic- tions and sentences. CCA judges may be com- missioned officers or civilians, but all must be lawyers. The U.S. Court of Appeals for the Armed Forces (USCAAF), formerly known as the Court of Military Appeals, is the highest civilian court responsible for reviewing the decisions of military courts. It is an APPELLATE court and consists of three civilian judges appointed by the president to serve 15-year terms. The USCAAF hears all cases where the death penalty is imposed, all cases forwarded by the JUDGE ADVOCATE general of each service for review after CCA review, and certain discretionary appeals. Its decisions are appealable to the U.S. SUPREME COURT. GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION 164 UNIFORM CODE OF MILITARY JUSTICE The UCMJ has been attacked by critics who believe that it severely and unnecessarily restricts First Amendment and other constitu- tional rights of military personnel. The nonju- dicial punishment of Article 15 has been criticized as susceptible to abuse, bias, and conflicts of interest. Because the military courts are necessarily different from civilian courts, the U.S. Supreme Court has limited the jurisdiction of the UCMJ. Discharged soldiers cannot be court-martialed for offenses committed while in the military. Civilian employees of the armed forces overseas and civilian dependents of military personnel accompanying them overseas are also not subject to the UCMJ. In addition, a crime committed by a member of the armed services must be related to military service in order for the UCMJ to apply. Early in 2001, the National Institute of Military Justice, an independent nonprofit organization, sponsored the creation of a five- member panel of experienced military leaders to coincide with the 50th anniversary of the UCMJ. Chaired by Walter Cox III, a former chief judge of the USCAAF, it was known as the Cox Commission, and it collected information and heard testimony on the UCMJ’s effective- ness after half a century. Based on its findin gs, the Cox Commiss ion concluded that certain elements of the UCMJ were in need of reform. One recommendation was that military judges should be given more autonomy and that commanding officers should assume a lesser role in pretrial court-martial activity. These changes, noted the commission, would help ensure fair and impartial trials for defendants. The commission also recommended that death-penalty cases should be tried by a court- martial panel of 12 (in some trials, the number has been as few as five); that panels should be instructed not to consider race as a factor in their deliberations; and that the number of attorneys with capital-case experience should be increased. Another recommendation was that the UCMJ should revise its sexual-misconduct regulations to make them less ARBITRARY. The commission noted that the sexual-misconduct provisions from the original UCMJ were outdated in the twenty-first century and that they were at least in part responsible for several of the notorious sexual-misconduct scandals within the military during the 1990s. Although not requested by the military or any other part of the government, the recommendations were submitted to the House and SENATE Armed Forces Committee and the Pentagon for their review. In 2006 Congress made several revisions to the UCMJ. In one revision, Congress enacted the death penalty for cases involving child rape. This change became the focus of a controversy in 2008 when the U.S. Supreme Court ruled that the death penalty for child rape cases was unconstitutional. In Kennedy v. Louisiana (554 U.S. ___, 128 S. Ct. 2641, 171 L. Ed. 2d 525) Justice ANTHONY KENNEDY stated that only six states permitted CAPITAL PUNISHMENT in cases involving child rape, when in fact Congress had approved the dea th penalty in such cases under the UCMJ only two years prior to the decision. Because of Justice Kennedy’s error, several commentators suggested that the Court should reconsider the issue. FURTHER READINGS Barry, Kevin J. 2002. “A Face Lift (and Much More) for an Aging Beauty: The Cox Commission Recommendations to Rejuvenate the Uniform Code of Military Justice.” Law Review of Michigan State Univ Detroit College of Law (spring). Index and Legislative History, Uniform Code of Military Justice. 2000. UCMJ 50th anniversary ed., 1950–2000. Buffalo, N.Y.: W.S. Hein. Pound, Edward T., et al. 2002. “Unequal Justice.” U.S. News & World Report (December 16). Schlueter, David A. 2008. Military Criminal Justice: Practice and Procedure 7th ed. Newark, N.J.: LexisNexis. Turner, Lisa L. 2000. “The Articles of War and the UCMJ.” Aerospace Power Journal 14 (fall). CROSS REFERENCES Criminal Procedure; Trial. UNIFORM COMMERCIAL CODE A general and inclusive group of laws adopted, at least partially, by all the states to further uniformity and fair dealing in business and commercial transactions. The Uniform Commercial Code (UCC) is a set of suggested laws relating to commercial transactions. The UCC was one of many uniform codes that grew out of a late nine- teenth-century movement toward uniformity among state laws. In 1890 the AMERICAN BAR ASSOCIATION , an association of lawyers, proposed that states identify areas of law that could be made uniform throughout the nation , prepare lists of such areas, and suggest appropriate legislative changes. In 1892 the National Confer- ence of Commissioners on Uniform State Laws GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION UNIFORM COMMERCIAL CODE 165 (NCCUSL) met for the first time in Saratoga, New York. Only seven states sent representa- tives to the meeting. In 1986 the NCCUSL offered up its first act, the Uniform Negotiable Instruments Act. The NCCUSL drafted a variety of other UNIFORM ACTS . Some of these dealt with commerce, including the Uniform Conditional Sales Act and the Uniform Trust Receipts Act. The uniform acts on commercial issues were fragmented by the 1930s and in 1940, the NCCUSL proposed revising the commerce-oriented uniform codes and combining them into one uniform set of model laws. In 1941 the American Law Institute (ALI) joined the discussion, and over the next several years lawyers, judges, and professors in the ALI and NCCU SL prepared a number of drafts of the Uniform Commercial Code. In September 1951 a final draft of the UCC was completed and approved by the American Law Institute (ALI) and the NCCUSL, and then by the House of Delegates of the American Bar Association. After some additional amendments and changes, the official edition, with explana- tory comments, was published in 1952. Penn- sylvania was the first state to adopt the UCC, followed by Massachusetts. By 1967 the District of Columbia and all the states, with the excep- tion of Louisiana, had adopted the UCC in whole or in part. Louisiana eventually adopted all the articles in the UCC except artic les 2 and 2A. The UCC is divided into nine articles, each containing provisions that relate to a specific area of COMMERCIAL LAW. Article 1, General Provisions, provides definitions and general principles that apply to the entire code. Article 2 covers the sale of goods. Article 3, COMMERCIAL PAPER , addresses negotiable instruments, such as promissory notes and checks. Art icle 4 deals with banks and their handling of checks and other financial documents. Article 5 provides model laws on letters of credit, which are promises by a bank or some other party to pay the purchases of a buyer without delay and without reference to the buyer’s financial solvency. Article 6, on bulk transfers, imposes an obligation on buyers who order the major part of the inventory for certain types of businesses. Most notably, article 6 provisions require that such buyers notify creditors of the seller of the inventory so that creditors can take steps to see that the seller pays her debts when she receives payments from the buyer. Article 7 offers rules on the relationships between buyers and sellers and any transporters of goods, called carriers. These rule s primarily cover the issu- ance and transfer of warehouse receipts and bills of lading. A bill of lading is a document showing that the carrier has delivered an item to a buyer. Article 8 contains rules on the issuance and transfer of stocks, bonds, and other invest- ment SECURITIES. Article 9, SECURED TRANSACTIONS, covers security interests in real property. A security interest is a partial or total claim to a piece of property to secure the performance of some obligation, usually the payment of a debt. This article identifies when and how a secured interest may be created and the rights of the creditor to foreclose on the property if the debtor defaults on his obligation. The article also establishes which creditors can collect first from a defaulting debtor. The ALI and the NCCUSL periodically review and revise the UCC. Since the code was originally devised, the House of Delegates of the American Bar Association has approved two additional articles: article 2A on PERSONAL PROPERTY leases, and article 4A on fund transfers. Article 2A establishes model rules for the leasing or renting of personal property (as opposed to real pro- perty, such as houses and apartments). Article 4A covers transfers of funds from one party to another party through a bank. This article is intended to address the issues that arise with the use of new technologies for handling money. Most states have adopted at least some of the provisions in the UCC. The least popular article has been article 6 on bulk transfers. These pro- visions require the reporting of payments made, which many legislators consider an unnecessary intrusion on commercial relationships. FURTHER READINGS Benfield, Marion W., Jr., and Michael M. Greenfield. 2006. Sales: Cases and Materials. Westbury, N.Y.: Foundation Press. Miller, Frederick H., and Alvin C. Harrell. 2002. The ABCs of the UCC. Related Insolvency Law. Chicago: American Bar Association. Rice, Paul R., ed. 2005. The Portable UCC. 4th ed. Chicago: Section of Business Law, American Bar Association Stone, Bradford, and Kristen David Adams. 2008. Uniform Commercial Code in a Nutshell. St. Paul, Minn.: Thomson/West. CROSS REFERENCES Commissioners on Uniform Laws; Contracts; Llewellyn, Karl Nickerson; Model Acts; Sales Law. GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION 166 UNIFORM COMMERCIAL CODE UNIFORM COMPUTER INFORMATION TRANSACTIONS ACT The Uniform Computer Information Transac- tions Act (UCITA) was promulgated to fill a void in existing contract law in the treatment of computer information. In a preface to UCITA, its creators wrote, “Our economy has experi- enced fundamental change legal rules that are not relevant to commercial practice or that are uncertain in application inhibit contracting or raise transaction costs. UCITA was drafted in response to this fundamental economic change and need for clarity in the law.” UCITA had a somewhat complex history. It was originally envisioned as a new Article 2B of the UNIFORM COMMERCIAL CODE, but its various drafts failed to satisfy the needs of the affected companies and consumers. Consequently, the National Conference Commission on Uniform State Laws (NCCUSL) decided to redr aft the proposal as UCITA, narrower than what had been envisioned for the UCC. It was first introduced in 1999. UCITA applies to computer-information transactions, defining them as “an agreement or the performance of it to create, modify, transfer, or license computer information or informational rights in computer information.” UCITA further defines computer information as “information in electronic form that is obtained from or through the use of a computer or that is in digital or equivalent form capable of being processed by a computer.” This definition includes a copy of information in that form and any documentation or packaging associated with the copy. UCITA applies only where there are computer-information transactions, if com- puter information is not the primary matter of the transaction but is a secondary matter, UCITA applies only to the portion of transaction involving computer information. UCITA applies to agreements to create, modify, transfer, or distribute computer software, interactive multi- media products, computer data and databases, INTERNET and online information and other computer-information transactions. In addition to those areas that do not fit into the defini- tions of computer information or computer- information transaction, UCITA expressly states that it does not apply to the following: (a) financial services transactions; (b) motion pictures or audio or visual programming, other than in (i) a mass-market transaction or (ii) a submission of an idea or information or release of informational rights that may result in making a motion picture or a similar information product; or sound recordings, musical works, or phonorecords, or an enhanced sound record- ing, other than in the submission of an idea or information or release of informational rights that may result in the creation of such material or a similar information product; (c) compul- sory licenses; (d) employment contracts; (e) contracts that do not require that information be furnished as computer information or in which the form of the information as com- puter information is otherwise significant with respect to the primary subject matter of the transaction; or (f) subject matter within the scope of other UCC Articles. Despite these exceptions, UCITA affects a variety of different contracts. As the preface states, “UCITA governs access by Fortune 500 companies to sophisticated databases as well as distribution of software to the general public; it also covers custom software develop- ment and the acquisition of various rights in multimedia products.” Included in its scope are shrink-wrap licenses and click-wrap agreements, both of which it validates; it also recognizes electronic records, authentication, and agents. The provisions of UCITA include general provi- sions, contract formation and terms, contract construction, warranties, transfer of interests and rights, performance, breach of contract, and remedies. According to its preface, “UCITA is the first uniform contract law designed specifically to address the new information economy. “Critics have assailed it as anti-consumer and pro-business, and they have claimed that its protections mostly apply to the software indus- try. In response, the NCCUSL amended UCITA 38 times, adding such consumer protections to permit public criticism of the performance of the computer information and making it clear that a buyer must have the opportunity to review the terms of an agreement in order for the terms to be enforceable. It now also expli- citly states that other laws will continue to apply where known defects are undisclosed. After its original approval in 1999, UCITA was amended in both 2000 and 2002. Nonethe- less, as of 2009 only Maryland and Virginia had GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION UNIFORM COMPUTER INFORMATION TRANSACTIONS ACT 167 . Tavern.” Both names are GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION 158 UNFAIR COMPETITION considered trade names under the law of unfair competition. Trademarks consist of words, symbols, emblems,. made with knowledge of its falsity or in reckless disregard of its truth ( NEW YORK TIMES V. SULLIVAN, 376 U.S. 254, 84 S. Ct. 710, 11 L. Ed. GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION 160. hiring of permanent replacements is a strikebreaking tactic that undermines GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION 162 UNIFORM ACTS UNIFORM CODE OF MILITARY JUSTICE The Uniform Code of Military