The legal environment of business text and cases 9th edition

Features that add insight and depth Managerial Str ategy Budget Cuts for State Courts Can Affect Businesses Ch 2, p 38 Insight into the Global Environment Bribery and the Foreign Corrupt Practices Act Ch 4, p 92 Insight into E-Commerce Do Computers Have Free Speech Rights? Ch 5, p 107 Insight into the Global Environment Even Smartphones Are Vulnerable to International Cyber Attacks Ch 7, p 161 Insight into the Global Environment Border Searches of Your Electronic Devices Ch 8, p 167 Insight into Ethics Can a Company That Sponsors a Contest Change the Prize from What It Originally Offered? Ch 9, p 192 Insight into Social Media “Catfishing”: Is that Online “Friend” Who You Think It Is? Ch 10, p 222 Insight into E-Commerce Taxing Web Purchases Ch 11, p 250 Insight into Ethics Warning Labels for Video Games Ch 13,  p 314 Insight into the Global Environment Is It Legal to Resell Textbooks Purchased Abroad? Ch 14, p 332 Insight into Social Media Live Chatting with Your State’s Bankruptcy Court Ch 16,  p 369 Insight into Ethics Should Franchisors Have to Give Prospective Franchisees Information about Potential Earnings? Ch 17,  p 409 Insight into Ethics The Ethical and Legal Implications of Breaching Company Policy on the Use of Electronic Data Ch 20,  p 475 Insight into Ethics Appearance-Based Discrimination Ch 22, p 509 Managerial Str ategy Many Companies Have to Revise Their Social Media Policies Ch 23, p 530 Copyright 2013 Cengage Learning All Rights Reserved May not be copied, scanned, or duplicated, in whole or in part Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s) Editorial review has deemed that any suppressed content does not materially affect the overall learning experience Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it Focus on Ethics Unit One Ethics and the Foundations p 96 Unit Two Ethics and the Public and International Environment p 184 Unit Three Ethics and the Commercial Environment p 388 Unit Four Ethics and the Business Environment p 463 Unit Five Ethics and the Employment Environment p 542 Unit Six Ethics and the Regulatory Environment p 640 Copyright 2013 Cengage Learning All Rights Reserved May not be copied, scanned, or duplicated, in whole or in part Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s) Editorial review has deemed that any suppressed content does not materially affect the overall learning experience Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it The Legal Environment of Business Text and Cases Ninth Edition Frank B Cross Herbert D Kelleher Centennial Professor in Business Law University of Texas at Austin Roger LeRoy Miller Institute for University Studies Arlington, Texas Australia • Brazil • Japan • Mexico • Singapore • United Kingdom • United States Copyright 2013 Cengage Learning All Rights Reserved May not be copied, scanned, or duplicated, in whole or in part Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s) Editorial review has deemed that any suppressed content does not materially affect the overall learning experience Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it This is an electronic version of the print textbook Due to electronic rights restrictions, some third party content may be suppressed Editorial review has deemed that any suppressed content does not materially affect the overall learning experience The publisher reserves the right to remove content from this title at any time if subsequent rights restrictions require it For valuable information on pricing, previous editions, changes to current editions, and alternate formats, please visit www.cengage.com/highered to search by ISBN#, author, title, or keyword for materials in your areas of interest Copyright 2013 Cengage Learning All Rights Reserved May not be copied, scanned, or duplicated, in whole or in part Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s) Editorial review has deemed that any suppressed content does not materially affect the overall learning experience Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it The Legal Environment of Business TEXT AND CASES Ninth EDITION Frank B Cross Roger LeRoy Miller Senior Vice President, Global Product Management Higher Education: Jack W Calhoun Vice President and General Manager, Social Sciences & Qualitative Business: Erin Joyner Product Director: Michael Worls © 2015, 2012 Cengage Learning WCN: 02-200-203 ALL RIGHTS RESERVED No part of this work covered by the copyright herein may be reproduced, transmitted, stored or used in any form or by any means graphic, electronic, or mechanical, including but not limited to photocopying, recording, scanning, digitizing, taping, Web 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sergign/Shutterstock; globe: mj 00 7/Shutterstock; compass: TADDEUS/Shutterstock; Insight Global globe: evantravels/Shutterstock Notice to the Reader Publisher does not warrant or guarantee any of the products described herein or perform any independent analysis in connection with any of the product information contained herein Publisher does not assume, and expressly disclaims, any obligation to obtain and include information other than that provided to it by the manufacturer The reader is expressly warned to consider and adopt all safety precautions that might be indicated by the activities described herein and to avoid all potential hazards By following the instructions ­contained herein, the reader willingly assumes all risks in connection with such instructions The publisher makes no representations or warranties of any kind, including but not limited to, the warranties of fitness for particular purpose or merchantability, nor are any such representations implied with respect to the material set forth herein, and the publisher takes no responsibility with respect to such material The publisher shall not be liable for any special, consequential, or exemplary damages resulting, in whole or part, from the readers’ use of, or reliance upon, this material Unless otherwise noted, all content © 2015 Cengage Learning Printed in Canada 1 2 3 4 5 6 7 17 16 15 14 13 Copyright 2013 Cengage Learning All Rights Reserved May not be copied, scanned, or duplicated, in whole or in part Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s) Editorial review has deemed that any suppressed content does not materially affect the overall learning experience Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it Brief Contents Unit One The Foundations  Chapter Chapter Chapter Chapter Law and Legal Reasoning  The Court System  28 Alternative and Online Dispute Resolution  60 Business Ethics  78 l Unit Two The Public and International Environment  99 Chapter Chapter Chapter Chapter Business and the Constitution  100 Administrative Agencies  121 Criminal Law and Cyber Crime  140 International Law in a Global Economy  166 Unit Three The Commercial Environment  187 Chapter Chapter Chapter Chapter Chapter Chapter Chapter Chapter 10 11 12 13 14 15 16 Formation of Traditional and E-Contracts  188 Contract Performance, Breach, and Remedies  219 Sales and Lease Contracts  248 Torts 282 Strict Liability and Product Liability  305 Intellectual Property Rights  320 Internet Law, Social Media, and Privacy  341 Creditor-Debtor Relations and Bankruptcy  358 Unit Four The Business Environment  393 Chapter 17 Chapter 18 Chapter 19 Small Business Organizations  394 Limited Liability Business Forms  416 Corporations 431 Unit Five The Employment Environment  465 Chapter Chapter Chapter Chapter Agency 466 Employment Relationships  490 Employment Discrimination  505 Immigration and Labor Law  525 20 21 22 23 Unit Six The Regulatory Environment  545 Chapter Chapter Chapter Chapter Chapter Consumer Protection  546 Environmental Law  563 Real Property and Land-Use Control  578 Antitrust Law  599 Investor Protection and Corporate Governance  618 24 25 26 27 28 iii Copyright 2013 Cengage Learning All Rights Reserved May not be copied, scanned, or duplicated, in whole or in part Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s) Editorial review has deemed that any suppressed content does not materially affect the overall learning experience Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it iv  Brief Contents APPENDICES A B C D E F How to Brief Cases and Analyze Case Problems  A–l The Constitution of the United States  A–5 Articles and 2A of the Uniform Commercial Code  A–13 The Sarbanes-Oxley Act (Excerpts and Explanatory Comments)  A–53 Answers to the Issue Spotters A–61 Sample Answers for Business Case Problems with Sample Answer A–67 GLOSSARY G–l TABLE OF CASES TC–1 INDEX I–1 Copyright 2013 Cengage Learning All Rights Reserved May not be copied, scanned, or duplicated, in whole or in part Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s) Editorial review has deemed that any suppressed content does not materially affect the overall learning experience Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it Contents Unit One The Foundations  Chapter Law and Legal Reasoning  Business Activities and the Legal Environment  Sources of American Law  The Common Law Tradition  Schools of Legal Thought  11 Classifications of Law  12 How to Find Primary Sources of Law  13 How to Read and Understand Case Law  15 Chapter The Court System  28 The Judiciary’s Role in American Government  28 Basic Judicial Requirements  29 Case Analysis Case 2.1  Mala v Crown Bay Marina, Inc (2013)  31 Spotlight on Gucci Case 2.2  Gucci America, Inc v Wang Huoqing (2011)  35 The State and Federal Court Systems  37 Judicial Procedures: Following a Case through the Courts 41 Case 2.3  Espresso Disposition Corp v Santana Sales & Marketing Group, Inc (2013)  47 Case Analysis Case 3.3 Lhotka v Geographic Expeditions, Inc (2010)  68 The Integration of ADR and Formal Court Procedures  72 ADR Forums and Services  73 International Dispute Resolution  74 Chapter Business Ethics  78 Business Ethics  78 Case 4.1  Johnson Construction Co v Shaffer (2012)  80 Case 4.2  May v Chrysler Group, LLC (2012)  82 Business Ethics and Social Media  83 Ethical Principles and Philosophies  84 Making Ethical Business Decisions  87 Case Analysis Case 4.3  Moseley v Pepco Energy Services, Inc (2011)  88 Global Business Ethics  90 Unit One Focus on Ethics:  Ethics and the Legal Environment of Business  96 Unit Two The Public and International Environment 99 Chapter Business and the Constitution  100 Chapter Alternative and Online Dispute Resolution  60 Negotiation and Mediation  60 Arbitration 62 Case 3.1  Cleveland Construction, Inc v Levco Construction, Inc (2012)
  63 Case 3.2  NCR Corp v Korala Associates, Ltd (2008) 66 The Constitutional Powers of Government  100 Case Analysis Case 5.1  Family Winemakers of California v Jenkins (2010)  103 Business and the Bill of Rights  105 Case 5.2  Doe v Prosecutor, Marion County, Indiana (2013)  108 Spotlight on Beer Labels Case 5.3  Bad Frog Brewery, Inc v New York State Liquor Authority (1998)  110 Due Process and Equal Protection  114 Privacy Rights  116 v Copyright 2013 Cengage Learning All Rights Reserved May not be copied, scanned, or duplicated, in whole or in part Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s) Editorial review has deemed that any suppressed content does not materially affect the overall learning experience Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it vi  Contents Chapter Administrative Agencies  121 The Practical Significance of Administrative Law  121 Agency Creation and Powers  122 The Administrative Procedure Act  125 Case Analysis Case 6.1  Federal Communications Commission v Fox Television Stations, Inc (2009) 126 Judicial Deference to Agency Decisions  129 Case 6.2  Mayo Foundation for Medical Education and Research v United States (2011)  130 Enforcement and Adjudication  132 Case 6.3  Craker v Drug Enforcement Administration (2013)  134 Public Accountability  136 Chapter Criminal Law and Cyber Crime  140 Civil Law and Criminal Law  140 Criminal Liability  142 Types of Crimes  144 Case Analysis Case 7.1 People v Whitmer (2013)  146 Defenses to Criminal Liability  150 Criminal Procedures  153 Case 7.2  Messerschmidt v Millender (2012)  154 Classic Case 7.3  Miranda v Arizona (1966)  155 Cyber Crime  158 Chapter International Law in a Global Economy  166 International Law  166 Case Analysis Case 8.1 Linde v Arab Bank, PLC (2013)  170 Doing Business Internationally  172 Regulation of Specific Business Activities  173 International Dispute Resolution   176 Case 8.2 S & T Oil Equipment & Machinery, Ltd v Juridica Investments, Ltd (2012)  176 U.S Laws in a Global Context  178 Spotlight on International Torts Case 8.3  Kiobel v Royal Dutch Petroleum Co (2013)  179 Unit Two Focus on Ethics:  Ethics and the Public and International Environment  184 Unit Three the Commercial Environment 187 Chapter Formation of Traditional and E-Contracts  188 An Overview of Contract Law  188 Case 9.1  Pan Handle Realty, LLC v Olins (2013)  189 Types of Contracts  191 Agreement 195 Spotlight on A mazon.com Case 9.2  Basis Technology Corp v Amazon.com, Inc (2008)  197 E-Contracts 203 Consideration 207 Case 9.3  Baugh v Columbia Heart Clinic, P.A (2013) 209 Contractual Capacity  210 Legality 211 Form: The Writing Requirement and Electronic Records  214 Third Party Rights  214 C h a p t e r 10 Contract Performance, Breach, and Remedies  219 Voluntary Consent  219 Performance and Discharge  223 Classic Case 10.1 Jacob & Youngs v Kent (1921)  224 Case Analysis Case 10.2  Kohel v Bergen Auto Enterprises, L.L.C (2013)  226 Damages for Breach of Contract  230 Case 10.3  Hallmark Cards, Inc v Murley (2013)  231 Equitable Remedies  235 Waiver of Breach  237 Contract Provisions Limiting Remedies  237 Appendix to Chapter 10: Reading and Analyzing Contracts  242 Copyright 2013 Cengage Learning All Rights Reserved May not be copied, scanned, or duplicated, in whole or in part Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s) Editorial review has deemed that any suppressed content does not materially affect the overall learning experience Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it I–22  Index Monopsony power, 608 Moral minimum, 80 Mortgage, 360–363 adjustable-rate, 361 creditor protections in, 361 defined, 360 down payment, 360–361 fixed-rate, 361 foreclosure, 361–363 insurance for, 361 recording of, 361 Most-favored-nation status, 175 Motions defined, 46 for directed verdict, 53 to dismiss, 46 for judgment as matter of law, 53 for judgment n.o.v., 55 for judgment on the pleadings, 48 as matter of law, 55 for new trial, 54–55 posttrial, 54–55 pretrial, 46–49, 48 for summary judgment, 49 Motion to dismiss, 46–49 MP3, file-sharing and, 346–348 Multilateral agreement, 168 Multiple product order, 550 Music, file-sharing of, 346–348 Mutual assent, 195 Mutual fund, 621 Mutual rescission, 227–228 N National Association of Securities Dealers (NASD), 625 National Conference of Commissioners on Uniform State Laws (NCCUSL), 5, 206 National Environmental Policy Act, 564, 565 National Export Initiative (NEI), 172–173 National Labor Relations Act (NLRA), 529–531 coverage and procedures of, 532 social media policies, 530 union election supervision, 534 National Labor Relations Board (NLRB), 83 cease-and-desist order, 529 duties of, 121, 124 function of, 529 workers protected by, 530–531 National law, 166 National origin, discrimination based on, 508–510 National Pollutant Discharge Elimination System (NPDES), 567 National Reporter System (Thompson Reuters), 15, 16 Natural law, 11–12 Natural rights, 11 Necessity as defense for criminal liability, 150–151 easements by, 582 Negligence, 294–301 of agents, 481–483 causation, 296–298 comparative, 301 as defense to product liability, 315–316 contributory, 301 criminal, 143 damages, 298 defenses to, 299–301 defined, 294 dram shop acts, 299 duty of care and its breach, 295–296 elements of, 295 environmental pollution and, 563–564 Good Samaritan statutes, 298–299 gross, 283 injury requirements, 298 malpractice, 296 negligence per se, 298 product liability based on, 306 Negotiable instruments, 193 Negotiated settlement, 133 Negotiation assisted negotiation, 60–61 defined, 60 early neutral case evaluation, 61 facilitation, 61 as form of ADR, 60–61 mini-trials, 60–61 preliminary, 196–197 preparing for, 60 Net profits, as source for dividends, 455 New York Convention, 176–177 Ninth Amendment, 106 Nominal damages, 234 Noncompete agreements, 213 Noncompete covenant, 212–213, 389–390 Nonconforming goods, 253 Nondeadly force, 150 Nonmerchant, contract rules for, 254 Nonpossessory interests, 582–583 Nonprofit (not-for-profit) corporation, 434 Normal trade relations (NTR) status, 175 Norris-LaGuardia Act, 529 North American Free Trade Agreement (NAFTA), 175–176 Notary public, 474 Notice of agency termination, 495 posting OSHA notices, 496 validation, 558 Notice-and-comment rulemaking, 128 Notice of motion, 46 Notification agent’s duty to, 472 collection agency and, 558 of CPSC of product safety, 555 of franchise termination, 410 layoffs, 495 Novation, 418 discharge by, 228 Nuclear Regulatory Commission (NRC), 124, 564 Nuisance, 579 defined, 563 environmental pollution and, 563 Nutrition Labeling and Education Act, 552 O Obedience, agent’s duty to, 472 Objective theory of contracts, 189–190 Copyright 2013 Cengage Learning All Rights Reserved May not be copied, scanned, or duplicated, in whole or in part Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s) Editorial review has deemed that any suppressed content does not materially affect the overall learning experience Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it Index   Objects, requests for, 50 Obscenity defined, 111 online, 112 Occupational Safety and Health Act, 496 Occupational Safety and Health Administration, 121, 122 Ocean Dumping Act, 565, 572 Offer communication of, 199 contractual, 191, 196–200 counteroffer, 200 defined, 196 definiteness of terms, 198–199 elements of, 196–199 firm, 253 intention, 196–198 irrevocable, 199–200 lease contracts, 251–253 online for e-contracts, 203–204 open terms, 252 output contract, 252–253 preliminary negotiations, 196–197 rejection, 200 as requirement of contract, 191 requirements contract, 252 revocation of, 199–200 for unilateral contract, 192–193 sales contracts, 251–253 termination of, 199–200 by operation of law, 200 Offeree agent of, 200 counteroffer by, 200 death or incompetence of, offer termination and, 200 defined, 191, 196 rejection of offer by, 200 Offeror death or incompetence of, offer termination and, 200 defined, 191, 196 revocation of offer by, 199–200 Officer, corporate, 443–451 acquiring assets, 463 aligning interests of officers with shareholders, 632–633 business judgment rule, 447–448 compensation committee, 633 conflicts of interest, 449–450 corporate governance and, 632–634 criminal liability of, 144 defined, 431 duties of, 446–450, 463–464 fiduciary duties, 463–464 liabilities of, 450–451 roles of, 446 stock option and, 632–633 Offshore fraud, 636 Oil Pollution Act, 565, 572 Online contracts See E-contracts Online dispute resolution (ODR), 73–74 Online travel companies (OTCs), 250 Open delivery term, 252 Opening statements, 51–52 Open payment term, 252 Open price term, 252 Open term, open quantity, 252 Operating agreement, 421–422 Operation of law agency formation by, 471 contract discharge by, 228–230 termination by, 485–486 Opinions concurring, 20 defined, 20 dissenting, 20 expression of, 196 majority, 20 per curiam, 20 plurality, 20 statement of, 272, 286 unpublished, 15 Oppressive conduct, 456 Option contract, 199–200, 253 Order for relief, 371, 372 Orders final, 134 initial, 134 Ordinances, Organized crime, 149–150 Original jurisdiction, 30 Outcome-based ethics, 84, 85–86 Output contract, 252–253 Outrageous conduct, 285 Outside director, 445 Overcriminalization, 143–144 Overtime, 494 O visa, 528 I–23 Ownership in real property concurrent ownership, 580–581 in fee simple, 579 leasehold estate, 581–582 life estates, 580 transfer of adverse possession, 588–589 deed, 586–588 real estate sales contract, 584–585 P Parallel citation, 15 Parent company, 432 Paris Convention, 334 Partially disclosed principal, 478–479 Participation, right of, 445 Partners See also Partnerships authority of, 401 buyout price, 403–404 compensation of, 400 dissociation of, 402–404 fiduciary duties of, 401 general, 425 inspection of books, 400 liability of, 402 limited, 425 property rights, 400 rights of, 399–400, 403 Partnerships (traditional general), 396–406 See also Partners accounting of assets/profits, 400 agency concept and, 396–397 agreement, 398–399 articles of, 398–399 buy-sell agreement (buyout agreement), 405–406 compared to other major forms of businesses, 457–458 defined, 397 dissolution, 404–405 duration of, 398 entity vs aggregate of individuals, 397–398 essential elements of, 397 by estoppel, 398 formation of, 398–399 joint ownership and, 397 Copyright 2013 Cengage Learning All Rights Reserved May not be copied, scanned, or duplicated, in whole or in part Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s) Editorial review has deemed that any suppressed content does not materially affect the overall learning experience Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it I–24  Index laws governing, 396–397 limited compared to, 425–428 limited liability limited partnership, 428 limited liability partnership, 424–425 limited partnership, 425–428 management rights, 399–400 taxes and, 398 for a term, 398 termination of, 404–405 Uniform Partnership Act (UPA), 397 at will, 398 winding up and distribution of assets, 404–405 Party, in interest, 370 Pass-through entity, 398, 419 Password protection, for social media, 351–352 Past consideration, 209–210 Patents, 325–328 defined, 325 infringement of, 326–327 remedies for, 327–328 patentable requirements, 326 searchable database for, 326 Patriot Act, 185 privacy rights and, 117 Pattern of conduct exception, 237 Payment lessor’s right of recover when due, 267 obligation of buyer or lessee, 265 open payment term, 252 tender of, 366 Peer-to-peer (P2P) networking, 346 Penalties, 234–235 Pension Benefit Guaranty Corporation (PBGC), 498 Pension plans, private, 498 Per curiam opinion, 20 Perfected security interest, 358 Perfection, security interest, 358 Perfect tender rule, 264 Performance accord and satisfaction, 228 agent’s duty to, 472 anticipatory repudiation, 266 complete, 223–224 conditions of, 223 of contract, 194 defined, 223 discharge of contract by, 223–227 impossibility of, 229–230, 388 of lease contracts, 263–266 obligations of buyer or lessee, 265–266 obligations of seller or lessor, 263–265 partial, exception to Statute of Frauds, 257 right to obtain specific, 267 of sales contract, 263–266 to satisfaction of another, 225 specific, 235–236 substantial, 224–225 tender of, 223 time for, 227 Periodic tenancy, 581 Per se violations, 600–601, 602, 603 Person corporation as, 431 foreign, 612 jurisdiction over, 29–30 legal, 431 natural, 431 Personal information, increased value of, 184 Personal property defined, 292 exemption, 368 trespass to, 293 Personal service contract, specific performance and, 236 Persuasive authorities, Pesticides, 572–573 Petition, in bankruptcy, 370 Petitioner, 7, 20, 55 Petty offenses, 141 Petty theft, 145 Phishing, 159–160 Pierce corporate veil, 417, 432, 441–443 Plaintiff complaint, 44 defined, 7, 20 Plant life, real property, 579 Plea bargaining, 153 Pleadings, 44–46 Plurality opinion, 20 Police powers, of states, 100–101 Pollution air, 565–567 hazardous waste, 573–575 toxic chemicals, 572–573 water, 567–572 Ponzi schemes, 636 Pornography, online, 112 Positive law, 12 Possession, artisan’s lien and, 359 Posttrial motions, 54–55 Potentially responsible party (PRP), 574 Power of attorney of agent, 474 defined, 474 general, 474 special, 474 Powers apparent, 476–477 of avoidance, 373 condemnation, 590 corporate, 440–441 emergency, 477 enumerated, 100 express, 440 implied, 440 market, 600 monopoly, 600, 605–606 monopsony, 608 police, 100–101 of shareholders, 451 strong-arm, 373 trustee in bankruptcy, 373 Precedent controlling, defined, departures from, Predatory behavior, 292 Predatory pricing, 604, 608 Predominant-factor test, 249–250 Preemption, 105 as defense to product liability, 315 Preemptive rights, 454 Preference, in bankruptcy, 374 Pregnancy Discrimination Act, 511 Preincorporation contracts, 418–419 Prepayment penalty clause, 361 Preponderance of evidence, 54, 140 Copyright 2013 Cengage Learning All Rights Reserved May not be copied, scanned, or duplicated, in whole or in part Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s) Editorial review has deemed that any suppressed content does not materially affect the overall learning experience Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it Index   Prescription, easements by, 582 Pretexting, 116–117 Pretrial conference, 51 Pretrial motion, 46 Pretrial procedures, 44–51 discovery, 49–51 jury selection, 51 motion to dismiss, 46–49 pleadings, 44–46 pretrial conference, 51 right to jury trial, 51 Price buyout price, 403–404 franchise pricing arrangements, 410 open price terms, 252 predatory pricing, 604, 608 price discrimination, 608–609 resale price maintenance agreement, 603–604 seller’s right to recover purchase price, 267 Price fixing, 601 Price-fixing agreement, 601 Prima facie case, 506–507, 515 Primary sources of law defined, how to find, 13–15 Principal agent’s duties to, 472–473, 542 bankruptcy, agency termination and, 486 death or insanity, agency termination and, 485 defined, 466 disclosed, 478–479 duties of, to agent, 473, 543 compensation, 473 cooperation, 473 reimbursement and indemnification, 473 safe working conditions, 473 partially disclosed, 478–479 rights and remedies of, 473–474 termination of agency, 484–486 torts of, 480 undisclosed, 479 Principle of rights, 84–85 Privacy Act, 116 Privacy/privacy rights Constitution and, 116 consumer privacy bill of rights, 354 data collection and cookies, 353–354 drug testing, 500–501 electronic monitoring, 499–500 of employees, 499–502 Fair Debt Collection Practices Act (FDCPA) and, 640 genetic testing, 502 Internet and, 184, 353–354 Internet companies’ privacy policies, 354 invasion of, 289–290 lie-detector tests, 500 medical information and, 117 Patriot Act and, 117 pretexting and, 116–117 statutes affecting, 116–117 in workplace, 184–185 Privately held corporation, 434–436 Private placement exemption, 623 Private Securities Litigation Reform Act (PSLRA), 628–629 Privilege, 289 Privileges and immunities clause, 101 Privity of contract, 214 product liability and, 306 Probable cause arrest and, 157 search warrants and, 113–114, 153 Probate court, 30 Procedural due process, 115 Procedural law, defined, 12 Procedural rules, 41–42 Processing-plant arrangement, 407 Product liability based on misrepresentation, 306–307 based on negligence, 306 consumer-expectation test, 310 defenses to, 315–316 defined, 305 due care, 306 inadequate warnings, 312–313 market-share liability, 313–314 privity of contract and, 306 public policy and, 307–308 I–25 requirements for, 309 risk-utility analysis, 310 statute of limitations and, 316 suits of, 283 video game warning labels, 314 Product misuse, 315 Products defective condition, 309 defects of, 309–313 design, 310–311 manufacturing, 309–310 unreasonably dangerous, 309 Professional association, 436 Professional corporation, 436 Professionals, duty of, 296 Profit maximization, 78–79 Profit(s) accounting of, in partnerships, 400 appurtenant, 582 in gross, 582 as nonpossessory interest in land, 582 sharing of, in partnerships, 397 short-swing, 628 Promise absolute, 223 for an act, 192 consideration and, 207–210 defined, 188 express warranty and, 271 Promotional activity, prior to incorporation, 437 Property community, 373, 581 conversion, 293 crimes involving, 145–147 disparagement of, 294 distribution of, in bankruptcy, 375–376 estate in, 373 homestead exemption, 367–368 intangible property, 249 intellectual See Intellectual property intentional tort against conversion, 293 disparagement of property, 294 trespass to land, 292–293 trespass to personal property, 293 Copyright 2013 Cengage Learning All Rights Reserved May not be copied, scanned, or duplicated, in whole or in part Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s) Editorial review has deemed that any suppressed content does not materially affect the overall learning experience Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it I–26  Index joint ownership, and partnership, 397 jurisdiction over, 29–30 ownership of partnership and, 400 real, 579–581 personal, 292 exemption, 368 private, taken by foreign governments, 171, 174 real, 292 land-use control and zoning, 593–595 limitations on rights of property owners, 590–593 nature of, 578–579 ownership in, 579–581 transfer of ownership, 584–589 secured, and automatic stay, 372–373 surrender of, to release surety/ guarantor, 366 tangible property, 249 Property crime, 145–147 Prosecutorial Remedies and Other Tools to end the Exploitation of Children Today Act (Protect Act), 112 Pro se representation, 41 Prospectus, 620 Protected class, 505 Proximate cause, 296 Proxy, 456–457 Proxy statements, 629 Publication requirement of libel, 286 Public corporation, 434 Public figures, defamation and, 289 Public hearing, for variance, 594 Publicly held corporation, 434 Public order crime, 147–148 Public policy contracts contrary to, 212–214 defined, exceptions to employment-atwill, 492–493 respondeat superior and, 481 strict product liability and, 307–308 Puffery, 272, 290, 546 Punitive damages, 234, 283 Purpose frustration of, 230 particular, 273 Q Quality, slander of, 294 Quantity, open term, 252 Question of fact, 39 Question of law, 39 Quid pro quo harassment, 512 Quitclaim deed, 587 Quorum, 445, 452 Quotas, 174–175 R Race affirmative action, 520–521 bona fide occupational qualification (BFOQ) and, 519 discrimination based on, 102, 508–510 as suspect trait, 115–116 Racketeer Influenced and Corrupt Organizations Act (RICO), 526 federal crimes under, 150 implications of, 150 Racketeering, 149–150 Railway Labor Act, 532 Ratification agency formation by, 470–471 of agent’s unauthorized acts, 477 of contract, 195 Rational basis test, 116 Reaffirmation agreement, 377–378 Real estate goods associated with, 249 sales contract for closing date and escrow, 584 implied warranties in sale of new homes, 584 marketable title, 584 seller’s duty to disclose hidden defects, 584–586 Real property defined, 292 land-use control and zoning, 593–595 limitations on rights of owners eminent domain, 590–592 inverse condemnation, 592 restrictive covenants, 592–593 nature of, 578–579 nonpossessory interests easement or profit, 582 license, 583 ownership in concurrent ownership, 580–581 in fee simple, 579 leasehold estate, 581–582 life estates, 580 transfer of ownership adverse possession, 588–589 deed, 586–588 real estate sales contract, 584–585 zoning laws, 593–595 Reasonable accommodations for employees with disability, 518–519 for religious practices, 510 Reasonable person standard, duty of care, 295 Rebuttal, 53 Recklessness, 143 Record, electronic e-signature and, 206 writing requirements of, 214 Recording statute, 587–588 Record on appeal, 55 Recross-examination, 53 Redemption rights, 363 Redirect examination, 53 Reformation, 213, 236–237 Registration, of trademark, 322 Registration statement, 620 Regulations administrative agencies, 122–124 environmental preservation and protection, 564–565 ethical issues of, 640–642 of franchises, 407–408 independent regulatory agencies, 123–124 as primary source of law, Copyright 2013 Cengage Learning All Rights Reserved May not be copied, scanned, or duplicated, in whole or in part Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s) Editorial review has deemed that any suppressed content does not materially affect the overall learning experience Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it Index   of securities, 618–619 by states, 100–101 Regulation Z, 556 Regulatory Flexibility Act, 136 Reimbursement principal’s duty of, 473 right of, 367 Rejoinder, 53 Relevant evidence, 52 Relevant market, 606–607 Religion discrimination based on, 510 establishment clause, 112–113 ethical principles and, 84 freedom of, 112–113 free exercise clause, 113 reasonable accommodations, 510 religious displays, 112–113 Remedy(ies) for agents and principals, 473–474 for breach of contract, 235–237 sales or lease contracts, 266–271 contract provision limiting, 237–238 for copyright infringement, 330–331 defined, 6, 219 equitable, 7, 235–237 in equity, at law, of lessor, 266–267 limitation-of-liability clauses, 238 for patent infringement, 327–328 prejudgment, 359 reformation, 236–237 rescission and restitution, 235 of seller, 266–267 specific performance, 235–236 standing to sue, 37 ultra vires acts, 441 for violations of Securities Act (1933), 624 for WARN violations, 495 Renunciation, agent’s termination of agency relationship, 484 Reorganization, 378–380 Repayment plan, Chapter 13, 382–383 Replevin, 268 Reporters, reports, 8, 14 Requirements contract, 252 Resale price maintenance agreement, 603–604 Rescission of contract, 235 defined, 7, 208 discharge of contract by, 227–228 as equitable remedy, 235 mutual, 227–228 new contract and, 208 restitution and, 235 Residential use of land, 593 Resource Conservation and Recovery Act, 565, 573–574 Respondeat superior, 481, 543 Respondent, 7, 20 Responsible corporate officer doctrine, 144 Restatement (Third) of Agency, 466 independent contractor, 467 Restatement (Second) of Contracts, 204 Restatement (Third) of Contracts, 11 Restatement of the Law of Contracts, 11 Restatement of Torts, 333 Restatement (Second) of Torts, 309 Restatement (Third) of Torts: Products Liability, 309 Restatements of the Law clarify and illustrate common law, 11 as secondary source of law, Restitution, 235 for deceptive advertising, 550 Restraint of trade common law and, 599 contracts in, 212–213 covenant not to compete, 212–213 defined, 599 horizontal, 601–602 vertical, 602–604 Restrictive covenant, 212–213, 592–593 Retail fraud, online, 159 Retained earning, 432 I–27 as source for dividends, 455 Retaliation claim, 512–513 Reverse discrimination, 508–509 Revised Model Business Corporation Act (RMBCA), 431, 445 Revised Uniform Limited Partnership Act (RULPA), 425 Revocation of buyer’s and lessee’s acceptance of goods, 269 defined, 193, 199 of offers, 199–200 of offers for unilateral contract, 192–193 principal’s termination of agency relationship, 484 Rights of agents, 473–474 airspace, 578 of contribution, 367 of directors, corporate, 445–446 to indemnification, 446 of inspection, 445, 455 in limited partnership, 427 natural, 11 of ownership, 579–581 of participation, 445 of partners, 399–400 preemptive rights, 454 of principals, 473–474 principle of, 84–85 privacy See Privacy/privacy rights of redemption, 363 of reimbursement, 367 of shareholders, 454–456 to strike, 536 of subrogation, 367 subsurface, 578–579 of surety and guarantor, 366–367 of survivorship, 580 of trustee in bankruptcy, 373, 374 voidable, 373–374 Right to-work laws, 531 Risk assumption of, as defense, 299–300, 315 of loss, 259–262 of personal assets and sole proprietorship, 396 Copyright 2013 Cengage Learning All Rights Reserved May not be copied, scanned, or duplicated, in whole or in part Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s) Editorial review has deemed that any suppressed content does not materially affect the overall learning experience Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it I–28  Index product warnings and, 312–313 to warn business invitees of risks, 295–296 Risk-free investments, 636 Risk-utility analysis, 310 Rivers and Harbors Appropriations Act, 565, 567 Robbery, 145 Rule, 10, 127 Rule 144, 623 Rule 144A, 623 Rule 504, 621–622 Rule 505, 622–623 Rule 506, 623 Rulemaking, 127–129 Rule of four, 41 Rule of reason per se violations and, 600–601 territorial or customer restrictions, 603 Rules of evidence, 52–53 S Safe Drinking Water Act, 565, 572 Safety drug safety, 554 food safety, 554 principal’s duty of safe working conditions, 473 Safe Web Act, 341–342 Sales consumer protection and, 553 cooling-off laws, 553 defined, 249 of goods, 232–233 of land, 232–233, 236 mail-order, 553 of ongoing business, and covenant not to compete, 212–213 online, 553 taxes on Internet sales, 250 telephone, 553 Sales contracts, 248–274 acceptance, 253–256 agreements to rescind sales contract, 228 breach of compensatory damages, 232–233 remedies for, 266–271 risk of loss, 262 choice-of-law clauses, 177–178 consideration, 256 defined, 248 firm offer, 253 formation of, 251–258 forum-selection clause, 177–178 good defined, 249 good faith, 263 good faith limitation, 253 identification, 258–259 insurable interest, 262–263 for international goods, 273–274, 278–281 law governing, 188, 257 letters of credit, 193 limitation of remedies for, 238 merchant defined, 251 mirror image rule, 254 offer, 251–253 output contract, 252–253 performance of, 263–266 predominant-factor test, 249–250 for real estate, 584–585 requirements contract, 252 right to cancel, 266, 267 risk of loss, 259–262 sales defined, 249 Statute of Frauds, 256–257 taxes on Internet sales, 250 UCC Article and, 248–251 unconscionability, 257–258 warranties, 271–273 Same-sex marriage, full faith and credit clause, 101 Sarbanes-Oxley Act, 90, 463, 464 increasing criminal penalties, 158 key provisions of, 633–635 Satisfaction, accord and, 228 Scienter requirement, 629–631 S corporations, 436 Search and seizure by administrative agencies, 132 in business context, 114 Fourth Amendment protections, 153 probable cause and, 113–114 Search warrant, 113–114 administrative agencies and, 132–133 Fourth Amendment protections, 153 probable cause and, 153 scope of, 154 Seasonably, 253 Second Amendment, 106 Secondary boycott, 536–537 Secondary meaning of trademark, 323–324 Secondary sources of law, Section 12 companies, 625 Secured creditors, distribution to, 375 Securities corporate governance and, 632–634 defined, 618 Howey test, 619 insider trading, 626 misappropriation theory, 628 online investment scams, 635–636 prospectus, 620 registration process, 620 registration statement, 620 regulation of, by SEC, 618–619 restricted, 623 state securities laws, 632 testing the waters, 621 tipper/tippee theory, 627–628 well-known seasoned issuer (WKSI), 621 Securities Act (1933), 619–625 exempt securities and transactions, 621–623 registration process, 620 securities defined, 619 violations of, 623–625 Securities and Exchange Commission (SEC), 5, 123 corporate blogs and securities fraud, 642 corporate governance and, 463 duties of, 121, 124 EDGAR database, 620 expanding powers of, 619 insider trading, 626–628 proxies and shareholder proposals, 452 Regulation A, 621 Regulation D, 621–623 resale and safe harbor rules, 623 Copyright 2013 Cengage Learning All Rights Reserved May not be copied, scanned, or duplicated, in whole or in part Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s) Editorial review has deemed that any suppressed content does not materially affect the overall learning experience Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it Index   updating regulatory process of, 618 Securities Exchange Act (1934) insider reporting and trading, 628 regulation of proxy statements, 629 scienter requirement, 629–631 Section 10b, 625–628 Section 16b, 628 violations of, 629–632 Security interest defined, 262, 358 perfected, 358 warranty of title and, 271 Self-defense, as defense for criminal liability, 150 Self-incrimination, 114, 152, 153 Seller goods held by, 261–262 obligation of, 263–265 place of business, 263 remedies for, 266–267 residence, 263 Seniority system, as defense to employment discrimination, 519–520 Sentencing guidelines, 158 Sentencing Reform Act, 158 Service corporation, 436 Service mark, 324 Service of process, 45–46 method of, 44–45 waiver of formal, 45–46 Services goods and services combined, 249–250 predominant-factor test, 249–250 Servient estate, 582 Settlement agreement, 228 Settlements, negotiated, 133 Seventh Amendment, 51, 106 Sexual harassment by co-workers, 514 Ellerth/Faragher affirmative defense, 512 forms of, 511–512 retaliation by employers, 512–514 same-gender harassment, 514 sexual orientation harassment, 514 by supervisors, 512 tangible employment action, 512 Sexual orientation harassment, 514 Shareholder agreement, 435 Shareholders, 451–456 aligning interests of officers with shareholders, 632–633 corporate governance and, 632–634 defined, 431 derivative suit of, 455–456 dividends and, 432, 454–455 duties of, 456 liability of, 431–432, 456 majority of, fiduciary duties of, 456 meetings of, 451–452 minority, 456 powers of, 451 preemptive rights, 454 proposals, 452 rights of, 454–456 stock certificates, 454 stock warrants, 454 transfer of shares, 455 voting by, 452–454 Shares of corporation, 438 transfer of, in closely held corporation, 434–436 Sharia, 39, 169 Sherman Antitrust Act, 178, 599–608 historical perspective on, 599 horizontal restraint, 601–602 jurisdictional requirements of, 600 monopolization, 604–608 overview of, 599–600 per se violations and rule of reason, 600–601 vertical restraints, 602–604 Shipment, date of, 265 Shipment contract, 259, 261, 263–264 Short sale, 361–362 Shrink-wrap agreement (shrinkwrap license), 204–205 Signatures, electronic, 205–207 Silence, as acceptance, 201 Simple contracts, 193 I–29 Sixth Amendment, 106, 153 Slander, 286–287 damages for, 286 defined, 286 of quality, 294 slander per se, 286–287 of title, 294 Sliding-scale standard, 33–35 Small Business Administration (SBA) franchises, 406–412 Office of the National Ombudsman, 136 partnerships, 396–406 Small Business Administration Act, 612 Small businesses franchises, 406–412 partnerships, 396–406 sole proprietorship, 394–396 Small Business Liability Relief and Brownfields Revitalization Act, 565 Small Business Regulatory Enforcement Fairness Act (SBREFA), 136 Small claims courts, 39 Smartphones, cyber attacks and, 168 Social media bankruptcy court live chats, 369 business ethics and, 83–84 corporate blogs and securities fraud, 642 defined, 348 discussing work-related issues on, 83–84 Electronic Communications Privacy Act (ECPA), 351 hiring procedures and, 83 internal networks, 352 legal issues and, 349–351 NLRA and company policies of, 530 password protection, 351–352 Social Security, 497 Social Security Act, 497 Social Security Administration, 497 Sociological school, 12 Software cloud computing and, 346 Copyright 2013 Cengage Learning All Rights Reserved May not be copied, scanned, or duplicated, in whole or in part Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s) Editorial review has deemed that any suppressed content does not materially affect the overall learning experience Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it I–30  Index copyright protection of, 331–333 filtering, 112 patents for, 327 Sole proprietorship, 394–396 advantages of, 394–395 compared to other major forms of businesses, 457–458 defined, 394 disadvantages of, 395–396 flexibility of, 394–395 lack of continuity, 396 personal assets at risk, 396 taxes and, 395 Sovereign immunity, doctrine of, 171–172 Sovereignty, 100 Spam, 341–342, 547–550 Special damages, 234, 282 Special-use permits, 594 Special warranty deed, 587 Specific performance, 235–236 defined, right to obtain, 267–268 Speech commercial, 110 compelling government interest, 108 computers and, 107 corporate political, 109–110 freedom of, 106–112, 184 trademark protection vs., 390 trade secrets vs., 391 outrageous conduct and, 285 reasonable restrictions, 107–108 symbolic, 106–107 unprotected, 111–112 Stakeholders, corporate social responsibility and, 87 Standing to sue, 36–37 Stare decisis, 169 aspects of, common law tradition and, legal reasoning and, 9–10 legal stability and, 8–9 State, Department of, 123 State codes, 14 State court system, 37–39 appellate courts, 39 budget cuts to, effect on business, 38 citations of, 17 decisions of, 14–15 judge selection for, 39 supreme (highest) courts of, 39 trial courts of, 30, 39 Statements of fact, 286 of future intent, 196 of opinion, 272, 286 of value, 272 States/state government commerce clause, 102–104 full faith and credit clause, 101 immigration law, 528–529 laws of layoff notification, 495 ordinances, trade secrets, 333 uniform laws, limited liability companies, 422 limited liability partnerships and, 424–425 limits on, and Bill of Rights, 105–106 police powers, 100–101 privileges and immunities clause, 101 recording statute, 587–588 regulation by, 100–101 agencies of, environmental preservation and protection, 564 of franchises, 408 spam, 341 securities laws of, 632 selecting state of incorporation, 437 sovereignty of, 100 supremacy clause, 104–105 Statute of Frauds defined, 214 exceptions to, 256–257 UCC and, 256–257 writing requirement, 364 of contracts, 214, 256 Statute of limitations contracts and, 229 as defense for criminal liability, 152 surety/guarantor defense, 366 Statutes arbitration, 62–64 contracts contrary to, 211–212 federal, Good Samaritan statutes, 298–299 long arm statute, 29 as primary source of law, 4, recording statutes, 587–588 state, Statutes of limitations defined, 7, 116 product liability defense, 316 Statutes of repose, 316 Statutory law citations, 18 defined, finding, 14 as primary source of law, 3, as source for contract law, 188 trademark protection and, 322 Stock certificates, 454 Stock option, 632–633 Stocks See also Securities shares of, and article of incorporation, 438 stock certificates, 454 transfer of shares, 455 watered stock, 456 Stock warrants, 454 Stop Counterfeiting in Manufactured Goods Act (SCMGA), 324–325 Strict liability, 305–314 abnormally dangerous activities, 305–306 bailment, 306 crime and, 143–144 defined, 305 environmental pollution and, 563–564 historical perspective on, 305 potentially responsible party and, 574 product liability, 306–316 wild animals and, 306 Strict product liability consumer-expectation test, 310 defenses to, 315–316 inadequate warnings, 312–313 market-share liability, 313–314 product defects, 309–313 public policy and, 307–308 Copyright 2013 Cengage Learning All Rights Reserved May not be copied, scanned, or duplicated, in whole or in part Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s) Editorial review has deemed that any suppressed content does not materially affect the overall learning experience Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it Index   requirements for, 309 risk-utility analysis, 310 statute of limitations and, 316 Strict scrutiny, 115–116 Strike defined, 536 illegal, 536–537 right to, 536 strikers’ rights after end of, 537 Strong-arm power, 373 Subchapter S of IRS code, 436 Submission, in arbitration process, 64–65 Subpoena administrative agencies and, 132 ad testificandum, 132 duces tecum, 132 Subrogation, right of, 367 Substance abuse, as disability, 518–519 Substantial abuse, of bankruptcy, 370–371 Substantial-capacity test, 151–152 Substantial performance, 224–225 Substantive due process, 115 Substantive law, 12 Substantive rules, 124 Subsurface rights, 578–579 Suggestive trademark, 323 Summary judgment, 49 Summary jury trial, 73 Summons, 45 Sunshine Act, 136 Superfund, 574 Superseding cause, 300–301 Supervisors, sexual harassment by, 512 Suppliers, monitoring employment practices of foreign, 91 Supreme Court, U.S See United States Supreme Court Supreme Court Reporter (S.Ct.), 15 Suretyship, 364 actions that release, 366 defenses of, 366 defined, 364 rights of, 366–367 Surplus, as source for dividends, 455 Suspect trait, 115–116 Symantec, 86 Symbolic speech, 106–107 T Taft-Hartley Act, 531 Taking, 590, 641 Tangible employment action, 512 Tangible property, 249 Tariffs, 175 Taxes/taxation congressional power to, 105 corporations, 432 double taxation, 432 holding companies and, 432 on imported goods, 175 information return, 398 on Internet sales, 250 of limited liability company, 419 Medicare, 497–498 partnerships and, 398 pass-through entity, 398, 419 S corporations, 436 Social Security, 497 sole proprietorship and, 395 tariffs, 175 tax returns during bankruptcy, 370 Telemarketing, 550–551 Telemarketing and Consumer Fraud and Abuse Prevention Act, 550 Telephone Consumer Protection Act (TCPA), 550 Telephone Records and Privacy Protection Act, 117 Telephone sales, 553 Tenancy in common, 580 by the entirety, 580–581 fixed-term, 581 joint, 580 periodic, 581 at sufferance, 581–582 at will, 581 for years, 581 Tender of delivery, 259, 261–262, 263 of payment, 366 perfect tender rule, 264 of performance, 223 I–31 Tenth Amendment, 4, 100, 106 Termination of agency, 484–486 of easement or profit, 582 of franchise, 408, 410–412 notice of, 485 of offer, 199–200 by operation of law, 485–486 of partnerships, 404–405 wrongful, 411, 484–485 Term(s) additional, 254–256 browse-wrap, 205 definiteness of, 198–199 generic, 324 open, 252 open delivery term, 252 open payment term, 252 open price term, 252 partnership for a, 398 shrink-wrap and agreement, 205 Territorial restrictions, 602–603 Territorial rights of franchise, 409–410 Terrorism civil liberties and control of crime, 185 cyberterrorism, 160–161 Testing the waters, 621 Textbooks, reselling textbooks purchased abroad, 332 Theft, 145 cyber, 159–160 identity, 159 of trade secrets, 149 Third Amendment, 106 Third party defined, 214 liability to, and partner dissociation, 404 third party beneficiary contract, 214, 215–216 Tie-in sales agreement, 609 Time acceptance and, 202 for performance, 227 reasonable, 200, 227, 252, 262, 263, 285 Tipper/tippee theory, 627–628 Title defined, 258 document of, 259, 262 Copyright 2013 Cengage Learning All Rights Reserved May not be copied, scanned, or duplicated, in whole or in part Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s) Editorial review has deemed that any suppressed content does not materially affect the overall learning experience Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it I–32  Index identified goods and, 258 marketable, 584 passage of, 258–259 slander of, 294 warranties, 271 Title insurance, 584 Title VII of Civil Rights Act, 505–515 class-action limitations, 506 constructive discharge, 511 discrimination, based gender, 510–511 on race, color, and national origin, 508–510 religion, 510 Equal Employment Opportunity Commission (EEOC), 505–506 intentional and unintentional discrimination, 506–508 online harassment, 514 remedies, 514 sexual harassment, 511–514 Tolled, 316 Tortfeasor, 480 defined, 284 Torts, 282–284, 282–301 of agent, 483–484 business wrongful interference with a contractual relationship, 291–292 wrongful interference with business relationship, 292 classification of, 284 corporations and, 432–433 cyber torts, 352–353 damages available to, 282–283 defenses, 284 defined, 282 exceptions to employment-atwill, 492 of independent contractor, 484 intentional against person abusive or frivolous litigation, 290–291 assault, 284 battery, 284–285 defamation, 286–289 defined, 284 false imprisonment, 285 fraudulent misrepresentation, 290 intentional infliction of emotional distress, 285 invasion of privacy, 289–290 intentional against property conversion, 293 disparagement of property, 294 trespass to land, 292–293 trespass to personal property, 293 international claims, 178–180 of principal, 480 purpose of, 282 reform of, 283–284 toxic, 563 unintentional (negligence) causation, 296–298 defenses to, 299–301 dram shop acts, 299 duty of care and its breach, 295–296 Good Samaritan statutes, 298–299 injury requirements and damages, 298 negligence per se, 298 Toxic chemicals, 572–573 Toxic Substances Control Act, 565, 573 Toxic torts, 563 Trade contracts in restraint of, 212–213 minimizing barriers to, 175–176 restraints of, 599 usage of, 273 Trade associations, 602 Trade dress, 324 Trade libel, 294 Trademark, 320–324 counterfeit goods and, 324–325 defined, 320 dilution of, 322, 344–345 distinctiveness of mark, 323–324 fanciful and arbitrary, 323 generic terms, 324 infringement of, 322–323 meta tags and, 343–344 protection of, vs free speech rights, 390 registration of, 322 secondary meaning of, 323–324 statutory protection of, 322 suggestive, 323 summary of, 334 Trademark Dilution Revision Act (TDRA), 322 Trade name, 325 securing corporate name and, 438 Trade secrets company-wide social networks and protection of, 352 in cyberspace, 333 defined, 333 free speech rights vs., 391 state and federal law on, 333 summary of, 334 theft of, 149 Trading with the Enemy Act, 174 Traditional general partnership See Partnerships (traditional general) Transferred intent, 284 Transfers in bankruptcy, 374 fraudulent, 374 Transgender persons, discrimination against, 543 Transportation, Department of, 123 Travel time, scope of employment and, 483 Treasury, Department of, 123 Treaty, 168 Treble damages, 611 Trespass to chattels, 293 to land, 292–293 to personal property, 293 to personalty, 293 Trial courts closing arguments, 53 defined, 15 federal (district), 30 state, 30, 39 Trials closing arguments, 53 examination of witnesses, 53 jury instructions to, 53–54 right to, 51 Copyright 2013 Cengage Learning All Rights Reserved May not be copied, scanned, or duplicated, in whole or in part Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s) Editorial review has deemed that any suppressed content does not materially affect the overall learning experience Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it Index   selection of, 51 motion for new, 54–55 opening statements, 51–52 posttrial motions, 54–55 potential motions and judgment, 53 pretrial procedures, 44–51 rules and procedures of, 51–54 rules of evidence, 52–53 summary jury trial, 73 verdict, 54 Triple bottom line, 79 TRIPS agreement, 336 Trustee bankruptcy, 369, 373–374 United States, 370 Truth-in-Lending Act (TILA), 555–557 Tying arrangement, 609 Typosquatting, 343 U Ultra vires doctrine, 440–441 Unconscionability of contracts or clauses, 213, 388–389 procedural, 213 of sales or lease contracts, 257–258 substantive, 213 under UCC, 213 Undertaking Spam, Spyware, and Fraud Enforcement with Enforcers Beyond Borders Act, 342 Undisclosed principal, 479 Undue hardship reasonable accommodations for disabilities, 518 reasonable accommodations for religious practices and, 510 Undue influence, voluntary consent and, 221 Unemployment compensation, 498 Unenforceable contract, 195 Unequivocal acceptance, 200–201 Unfair labor practices, 537–539 Uniform Arbitration Act, 63 Uniform Commercial Code (UCC) adoption of, 5, 248 agreements to rescind sales contract, 228 anticipatory repudiation, 266 Article 2, franchises under, 407 Article (sales contracts), scope of, 248–251 Article 2A (leases), scope of, 251 commercial reasonableness, 252, 263, 388 communication of acceptance, 253–254 compared to CISG, 168, 274 consideration, 256 creation of, firm offer, 253 goal of, 248 good faith and, 252, 263, 388 good faith limitation, 253 identification, 258–259 insurable interest, 262–263 mirror image rule, 254 open terms, 252 passage of title, 258–259 perfect tender rule, 264 risk of loss, 259–262 sales contract and limited remedies, 238 as source for contract law, 188 Statute of Frauds, 256–257 terms between merchants, 254 unconscionability, 213, 257–258, 388 warranties under, 271–273 Uniform Electronic Transactions Act (UETA), 202, 479–480 E-SIGN Act and, 206 scope and applicability, 206 signatures on electronic records, 206–207 Uniform laws, Uniform Negotiable Instruments Law, Uniform Partnership Act (UPA), 397, 422 Uniform Source Locators (URLs), citations to, 19 Uniform Trade Secrets Act, 333 Unilateral contracts, 192–193 Unilateral mistake, 219–220 I–33 Unintentional discrimination, 508 Unintentional torts (negligence) causation, 296–298 defenses to, 299–301 dram shop acts, 299 duty of care and its breach, 295–296 Good Samaritan statutes, 298–299 injury requirements and damages, 298 negligence per se, 298 Unions authorization card, 534 closed shop, 531 collective bargaining, 535–536 decision to form or select, 532, 534 elections, 534–535 employer’s discrimination against union workers, 538 employer’s domination of union, 538 employer’s interference with, 538 employer’s refusal to recognize or negotiate with, 538 as exclusive bargaining representative, 535 featherbedding, 531 federal laws regarding, 529–532 good faith bargaining, 529–530, 536 hot-cargo agreements, 531 lockouts, 537 negotiating terms and conditions, 535–536 right-to-work laws, 531 strikes, 536–537 unfair labor practices, 537–539 coercion, 538–539 discrimination by, 539 union shop, 531 Union shop, 531 United Nations Commission on International Trade Law, 168 Contracts for the International Sale of Goods (CISG), 168 Convention on the Recognition and Enforcement of Foreign Arbitral Awards, 74, 176–177 Copyright 2013 Cengage Learning All Rights Reserved May not be copied, scanned, or duplicated, in whole or in part Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s) Editorial review has deemed that any suppressed content does not materially affect the overall learning experience Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it I–34  Index General Assembly of, 168 United States Code (U.S.C.), 14 citation to, 14 Section 1001 of Title 18, 450 United States Code Annotated (U.S.C.A.) (West), 14 United States Constitution administrative agencies and, 124–125 affirmative action programs, 520 checks and balances, 101 commerce clause, 102–104 delegation doctrine, 124–125 due process clause, 114–115 equal protection clause, 115–116 establishment clause, 112–113 federal courts under, 28, 30–31 federal form of government, 100–105 freedom of religion, 112–113 freedom of speech, 106–112 free exercise clause, 113 full faith and credit clause, 101 health-insurance requirement, 100 powers of government, 100–105 as primary source of law, 3, privacy rights and, 116–118 privileges and immunities clause, 101 search and seizure, 113–114 self-incrimination, 114 separation of powers, 101 supremacy clause, 104–105 as supreme law of the land, 4, 100 taxation, 105 United States Reports (U.S.), 15 United States Statutes at Large, 14 United States Supreme Court appeals to, 41 decisions of, as binding authority, judicial review, 29 petitions granted by, 41 rule of four, 41 United States trustee, 370 Unprotected speech, 111–112 Unreasonably dangerous products, 309 Unsecured creditors, distribution to, 375–376 USA Patriot Act, 117 U.S circuit courts of appeals, 40 U.S courts of appeals, geographic boundaries of, 40 U.S Department of Agriculture (USDA), 552–553 U.S Department of Health and Human Services, U.S district courts geographic boundaries of, 40 jurisdiction, 40 U.S Patent and Trademark Office, 322 searchable database, 326 U.S Safe Web Act, 341–342 Usury, 212 Utilitarianism, 85–86 V Validation notice, 558 Valid contract, 194 Value mistake of, 219, 220 statement of, 272 Variance, 594 Vegetation, real property, 579 Venue, 36 Verdict, 54 Vertically integrated firms, 602 Vertical merger, 610 Vertical restraints, 602–604 Vesting, 498 Veterans Affairs, Department of, 123 Vicarious liability, 481 Victimless crimes, 147–148 Video games, warning labels for, 314 Violent crime, 145 Virus, computer, 160 Visas H1-B visa, 528 H-2, O, L and E, 528 Voidable contract, 194–195 Voidable rights, 373–374 Void contract, 195 Voir dire, 51 Voluntary bankruptcy, 370–371 Voluntary consent defined, 219 duress, 221–222 fraudulent misrepresentation, 221 mistake, 219–220 undue influence, 221 Voting, by shareholders, 452–454 Voting lists, 452–453 W Wages collective bargaining and, 535 garnishment, 360 laws governing, 493–494 minimum, 494 overtime provision and exemptions, 494 wage discrimination, 511 Waiver of breach of contract, 237 class-action waiver in creditcard contracts, 68 defined, 237 of formal service of process, 45–46 of right to challenge arbitration award, 71, 72 Walsh-Healey Act, 493 Walt Disney Company, 87 War, agency termination and, 486 Warehouse receipt, 259 Warnings, product liability and, 312–313 Warranties disclaimers, 273 express, 271–272 implied, 272–273, 479 implied warranty of habitability, 584 in sales and lease contracts, 271–273 title, 271 Warrants search, 113–114, 132–133, 153–154 stock warrants, 454 Warranty deed, 587 Waste, 580 Watered stock, 456 Copyright 2013 Cengage Learning All Rights Reserved May not be copied, scanned, or duplicated, in whole or in part Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s) Editorial review has deemed that any suppressed content does not materially affect the overall learning experience Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it Index   Water pollution, 567–572 Clean Water Act (CWA), 567–572 drinking water, 572 ocean dumping, 572 oil pollution, 572 Webb-Pomerene Act, 612 Well-known seasoned issuer (WKSI), 621 Westlaw, citations to, 19 Wetlands, 569–570 Whistleblowing, 492–493 White-collar crime, 147–149 bankruptcy fraud, 149 bribery, 148–149 defined, 148 embezzlement, 148 increased criminal penalties for, 158 insider trading, 149 mail and wire fraud, 148 theft of trade secrets and other intellectual property, 149 Wildcat strikes, 537 Will, 579 partnerships at, 398 Winding up of limited liability company, 424 of partnerships, 404–405 Witnesses cross-examination, 53 direct examination of, 53 expert, 53 Women gender discrimination, 510–511 pregnancy discrimination, 511 sexual harassment of, 511–514 wage discrimination, 511 Worker Adjustment and Retraining Notification (WARN) Act, 494–495 Workers’ compensation, 496–497 Workout agreement, 361 Workouts, 378 Workplace electronic monitoring in, 499–500 principal duties to provide safe working conditions, 473 privacy rights in, 184–185 safety, OSHA requirements, 496 Works for hire, 469–470 World Trade Organization (WTO), 175 Worm, 160 Writing, requirements assurance of due performance, 265 I–35 confirmation between merchants and, 256 equal dignity rule, 474 guaranty, 364 merchant’s firm offer, 253 mortgage, 361 Statute of Frauds, 256 Writs of attachment, 359–360 of certiorari, 41 of execution, 56, 360 Wrongful discharge, 493 Wrongful dissociation, 403 Wrongful interferences, 291–292 Wrongful termination, of franchise, 411 Y Year Books, Z Zoning laws exceptions to, 594–595 purpose and scope of, 593–594 Copyright 2013 Cengage Learning All Rights Reserved May not be copied, scanned, or duplicated, in whole or in part Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s) Editorial review has deemed that any suppressed content does not materially affect the overall learning experience Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it Copyright 2013 Cengage Learning All Rights Reserved May not be copied, scanned, or duplicated, in whole or in part Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s) Editorial review has deemed that any suppressed content does not materially affect the overall learning experience Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it ... the following supplements: The Legal Environment of Business on the Web The Web site for the Ninth Edition of The Legal Environment of Business can be found by going to www.cengagebrain.com and. .. throughout the text to help students better understand how courts apply the principles in the real world New Spotlight Cases and Spotlight Case Problems For the Ninth Edition of The Legal Environment of. .. rely on the coverage, accuracy, and applicability of The Legal Environment of Business To make sure that our text engages your students, solidifies their understanding of legal concepts, and provides