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THE LEGAL ENVIRONMENT BUSINESS OF This page intentionally left blank THE LEGAL ENVIRONMENT BUSINESS OF A Critical Thinking Approach SIXTH EDITION NANCY K KUBASEK BARTLEY A BRENNAN M NEIL BROWNE Boston Columbus Indianapolis New York San Francisco Upper Saddle River Amsterdam Cape Town Dubai London Madrid Milan Munich Paris Montreal Toronto Delhi Mexico City São Paulo Sydney Hong Kong Seoul Singapore Taipei Tokyo Assistant Vice President, Executive Editor: Stephanie Wall Editorial Senior Project Manager: Karen Kirincich Editorial Director: Sally Yagan Editor in Chief: Donna Battista Director of Editorial Services: Ashley Santora Editorial Assistant: Brian Reilly Director of Marketing: Patrice Jones Marketing Assistant: Ian Gold Senior Managing Editor: Cynthia Zonneveld Project Manager: Carol O’Rourke Senior Operations Specialist: Diane Peirano Art Director: Jonathon Boylan Cover Designer: Jonathon Boylan Manager, Cover Visual Research & Permissions: Karen Sanatar Cover Art: Ron Koeber/© Aurora Photos/Alamy Media Development Manager: Cathi Profitko Full-Service Project Management: S4Carlisle Publishing Services Composition: S4Carlisle Publishing Services Printer/Binder: Webcrafters Cover Printer: Lehigh-Phoenix Color/Hagerstown Text Font: 10.5/12 Garamond Credits and acknowledgments borrowed from other sources and reproduced, with permission, in this textbook appear on appropriate page within text Copyright © 2012, 2009, 2006, 2003, 1999 Pearson Education, Inc., Upper Saddle River, New Jersey 04758 All rights reserved Manufactured in the United States of America This publication is protected by Copyright, and permission should be obtained from the publisher prior to any prohibited reproduction, storage in a retrieval system, or transmission in any form or by any means, electronic, mechanical, photocopying, recording, or likewise To obtain permission(s) to use material from this work, please submit a written request to Pearson Education, Inc., Permissions Department Many of the designations by manufacturers and seller to distinguish their products are claimed as trademarks Where those designations appear in this book, and the publisher was aware of a trademark claim, the designations have been printed in initial caps or all caps Library of Congress Cataloging-in-Publication Data Kubasek, Nancy The legal environment of business : a critical thinking approach / Nancy K Kubasek, Bartley A Brennan, M Neil Brown — 6th ed p cm ISBN-13: 978-0-13-266484-4 ISBN-10: 0-13-266484-4 Industrial laws and legislation—United States Business law—United States Trade regulation—United States I Brennan, Bartley A II Brown, M Neil III Title KF1600.K83 2011 346.7307—dc22 2010054532 10 ISBN 10: 0-13-266484-4 ISBN 13: 978-0-13-266484-4 To the numerous students who appreciate the importance of developing their critical thinking skills for their personal growth and development NANCY K KUBASEK AND M NEIL BROWNE In memory of Professor Thomas Dunfee of the Wharton School of Finance BARTLEY A BRENNAN This page intentionally left blank Brief Contents P A R T O N E Introduction to the Law and the Legal Environment of Business 1 Critical Thinking and Legal Reasoning 2 Introduction to Law and the Legal Environment of Business 15 The American Legal System 33 Alternative Tools of Dispute Resolution 70 Constitutional Principles 99 Cyberlaw and Business 134 White-Collar Crime and the Business Community 160 Ethics, Social Responsibility, and the Business Manager 202 The International Legal Environment of Business 228 P A R T T W O Private Law and the Legal Environment of Business 261 10 11 12 13 14 15 16 17 18 The Law of Contracts and Sales—I 262 The Law of Contracts and Sales—II 289 The Law of Torts 309 Product and Service Liability Law 342 Law of Property: Real and Personal 372 Intellectual Property 394 Agency Law 413 Law and Business Associations—I 434 Law and Business Associations—II 453 P A R T T H R E E Public Law and the Legal Environment of Business 477 19 20 21 22 23 24 25 26 The Law of Administrative Agencies 478 The Employment Relationship 499 Laws Governing Labor–Management Relations 527 Employment Discrimination 557 Environmental Law 600 Rules Governing the Issuance and Trading of Securities 629 Antitrust Laws 680 Laws of Debtor–Creditor Relations and Consumer Protection 721 APPENDIX A The Constitution Of the United States 763 APPENDIX B Uniform Commercial Code (2000 Official Text), Article 769 GLOSSARY INDEX 783 797 vii This page intentionally left blank Contents PREFACE xxxi ACKNOWLEDGMENTS xxxv ABOUT THE AUTHORS xxxvii P A R T O N E Introduction to the Law and the Legal Environment of Business 1 Critical Thinking and Legal Reasoning The Importance of Critical Thinking A Critical Thinking Model United States of America v Martha Stewart and Peter Bacanovic The Critical Thinking Steps Facts Issue Reasons and Conclusion Rules of Law Ambiguity Ethical Norms Analogies Missing Information Using Critical Thinking to Make Legal Reasoning Come Alive Legal Reasoning 10 Applying the Critical Thinking Approach 13 Assignment on the Internet 14 On the Internet 14 For Future Reading 14 Introduction to Law and the Legal Environment of Business 15 Definition of the Legal Environment of Business 16 Definition of Law and Jurisprudence 17 Natural Law School 18 Positivist School 19 Sociological School 19 American Realist School 20 Critical Legal Studies School 20 Feminist School 20 Law and Economics School 21 Sources of Law 21 The Legislature as a Source of Statutory Law 21 The Judicial Branch as a Source of Case Law 23 The Executive Branch as a Source of Law 25 Administrative Agencies as a Source of Law 25 ix ... and the Legal Environment of Business 1 Critical Thinking and Legal Reasoning 2 Introduction to Law and the Legal Environment of Business 15 The American Legal System 33 Alternative Tools of Dispute... University of San Francisco About the Authors NANCY KUBASEK is a Professor of Legal Studies at Bowling Green State University, where she teaches the Legal Environment of Business, Environmental... associations, Professor Kubasek has served as president of the TriState Regional Academy of Legal Studies in Business, and president of the national professional association, the Academy of Legal Studies
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