1. THE LEGAL
ENVIRONMENT
Chad Penny, Kimberly Schaub. Courtney Spall,
Kaya Comrie

2. COMMON LAW
Body of law that comes from decisions handed down by Judiciary
part of our government through court system
Also known as unwritten law
Uses what is called Precedents, which are decisions decided in
previous cases
Created by decisions made in trial courts, appellate courts, and
special courts
Lower courts must abide by precedents made by higher courts

3. STATUTORY LAW
Actual written law that is made up of Federal and State
constitutions, legislative enactments, treaties of the Federal
Government and Ordinances
Although written where anyone can read, it’s usually determined
by courts systems.
Law created by legislatures

4. ADMINISTRATIVE
AGENCIES
Federal or State institutions and other government organizations
created by Congress or state legislators with delegated power to create
rules and regulations within their given area of authority
Legislative bodies can create administrative agencies, as well as
terminate them
Agencies can pass rules and regulations within it’s area of authority,
conduct investigations in rule violations, as well as hold hearings
Important agencies include the Securities and Exchange Commission
(SEC), Federal Reserve Board, as well as the Equal Employment
Opportunity Commission

5. ANTITRUST
LEGISLATION
Was created in 1890 by Congress.
Sherman Antitrust Act was passed to alleviate any chance of large
companies becoming so big that smaller companies would be
crushed
Forbids: Contracts, combinations, or conspiracies in restraint of
trade, as well as the creation of Monopolies
Other laws enacted: Clayton Act of 1914. Federal Trade
Commission Act of 1914, Robinson-Patman Act of 1936

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7. TORT LAW
Any wrong doing against another person, property, or reputation
Often non-criminal in nature I.E. Tobacco lawsuits
Examples of Torts:
Negligence
Product Liability
Strict Product Liability

8. DEREGULATION
Government withdrawal of certain laws and regulations that seem
to hinder competition
Example: Airline Industry
Banking Industry downfall of Deregulation
Government takeover of Fannie May and Freddy Mac/Bailout of
AIG

9. COPYRIGHTS
Protects a creator's rights to materials such as books, articles,
photos, paintings and cartoons.
Filed in Library of Congress and lasts lifetime + seventy years
Can be passed to heir
JK Rowling lawsuit

10. TRADEMARKS
Legally protected name, symbol, or design that identifies the
goods or services of one seller and distinguishes them from those
of competitors.
Belongs to owner forever as long as it’s properly registered and
renewed every ten years
Protected against infringement
Some well known trademarks include: AFLAC duck, Mickey
Mouse, McDonald’s arches, Nike swoosh

11. BANKRUPTCY
The legal process by which a person, business, or gov't entity
unable to meet financial obligations is relieved of these
obligations by a court that divides any assets among creditors,
allowing creditors to get at least part of their money and freeing
the debtor to begin anew.
The US Constitution gives congress the power to establish
bankruptcy laws, and legislation has existed since the 1890's.

12. BANKRUPTCY CON’T
Different types of bankruptcy:
Chapter 7: Straight bankruptcy in which all assets are divided
among creditors after exemptions
Chapter 11: Allows a firm to reorganize and continue operation
after paying only a limited portion of it’s debts. EX: AA
Chapter 13: Allows individuals to pay their creditors over an
extended period of time

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14. CONTRACT LAW
Contract: Legally enforceable agreement between two or more
parties
Contract Law: Specifies what constitutes a legally enforceable
agreement
Consideration: Something of value someone is willing to give up
in order to enter into contract with someone else

15. CONTRACT LAW
CON’T
What makes a contract binding?
1. Oral or written offer is made
2. Mutual acceptance/agreement of offer and cannot be forced
upon
3. Both parties give consideration/collaboration. Both parties
must hold up their end of contract
4. Both parties sober and conscience of details of contract
5. Must be legal and not contain any stolen goods
6. Contract is in proper form

16. BREACH OF
CONTRACT
Happens when one party fails to uphold their end of contract
Damages: Agreed settlement awarded by the court to person
affected by breach of contract
If breech happens, the following can occur:
1. Specific Performance
2. Payment of Damages
3. Discharge of Obligation

17. LAWS TO PROTECT
CONSUMERS
Consumerism: A social movement that seeks to increase and
strengthen the rights and powers of buyers in relation to the
sellers
Fair Packaging and Labeling Act of 1966: Makes deceptive
packaging or labeling of a package illegal
Child Protection Act of 1966: Removes unsafe toys and allows
the FDA to pull dangerous products from the market

18. TAX LAWS
Taxes: How all forms of government raises money
Governments have used taxes primarily as a source of funding
for their operations and programs
Sin Tax: Used to raise prices on certain items
Tax Credits: An amount firms can deduct from their tax bills

19. TAX LAWS CON’T
Income Tax: Income received by businesses and individuals
Property Taxes: Paid on real and personal property
Sales Taxes: Paid on merchandise sold at retail level
Excise Tax: Paid on Select handful of items

20. PATENTS
A document that gives inventors exclusive rights to their
inventions for twenty years
Approval two to four years
USPTO
Selling and license use of patents
International companies

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22. UCC
Uniform Commercial Code
Laws that cover any and all sales transactions
Adopted by all fifty states
Has eleven articles which contain laws covering sales

23. WARRANTIES
Article two of the UCC
Four Types:
Warranty- guarantees that the product sold will be acceptable
for the purpose for which the buyer intends to use it.
Express warranties- are specific representations by the seller
that buyers rely on regarding the goods they purchase

24. WARRANTIES CON’T
Implied warranties- are legally imposed on the seller, who implies
that a product will conform to the customary standards of the
trade or industry in which it competes.
Full/limited warranty-full warranty requires a seller to replace or
repair a whereas a limited warranty typically limits the defects or
mechanical problems the seller cover.

25. NEGOTIABLE
INSTRUMENTS
Negotiable instruments- forms of commercial paper (such as checks)
that are transferable among business and individuals; they represent a
promise to pay a specified amount.
Article 3 of the UCC requires negotiable instruments to follow four
conditions
-they must be written and signed by the maker or drawer
-they must be made payable on demand or at a certain time
-they must be payable to the bearer or to specific order
-they must contain an unconditional promise to pay a specified amount
of money.

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