If you've had American Government or Political Science class this might be review or at least

sound familiar to you. But it's a foundational chapter - the rest

of the semester we will talk about terms like "common law."

You'll hear that again in subsequent chapters. The slides and presentation is not a replacement

for reading the textbook. The examples and a lot of the cases are not

in this presentation so you are going to want to read the complete chapter.

Let's start out with a definition of Law. Enforceable rules governing relationships

among individuals and between those individuals and their society.

Rights, duties, and privileges that are consistent with the values and beliefs of a society.

The first source of American Law is Constitutional. It's based on the text of the Federal or US

Constitution and state constitutions. U.S. Constitution is the supreme law of the

land. The next source of American law is Statutory

law. These are laws that are enacted by federal

and state legislatures and even go down to the local level (called ordinances). There's

even been some attempts among the states to create Uniform Laws (e.g., Uniform Commercial

Code or UCC that governs the sale of goods).

The next source of American law is Administrative Law

This include rules, orders and decisions of agencies at both the federal or state levels.

Could include independent regulatory agency (e.g. FDA).

The final rules are published in the Federal Register.

An example of this would be the Dodd-Frank Act.

The purpose of administrative law is to ensure that the rule issued is based on a consideration

of relevant factors rather than being arbitrary and capricious, which include the powers to:

Conduct Inspections and Tests. Issue Subpoenas.

Search Warrants.

The last source of American law we will talk about is Case Law or Common Law (I'll use

those terms interchangeably). Rules and decisions made by courts.

All areas of law not covered by statutory or administrative law.

Based on Early English law or King's Courts Established the common law—body of general

legal principles applied throughout the English empire.

This is the biggest body of law we have today. Used precedent to build the common law.

Precedent Practice of deciding new cases based on prior

ones. Controlling precedent means a higher court's

decision has binding authority on lower courts. In some cases, higher courts depart from precedent.

Based on the concept of "Stare Decisis", which means "stand on decided cases."

So, courts don't reinvent the wheel - they tend to decide the same type of cases the

same way to be consistent. Lower courts need to follow suit.

Remedies are defined as "the enforcement of a right or compensate for injury to that right."

Remedy at Law In King's courts, remedies were restricted

to damages in either money or property. Remedies in Equity are different. It's based

on justice and fair dealing - doing what is right. Some examples include-

Specific Performance (order of the court making the other party do what they already promised

to do) Injunction (which might be an order preventing

somebody from doing something) Rescission (undoing a promise or contract)

Merging of Law and Equity Most courts today can award remedies in law

or equity. You can even ask for both remedies in the same case.

Classifications of Law Substantive vs. Procedural

Substantive Laws that define and regulate rights and duties.

Procedural (more about how to get those rights). Laws that establish methods for enforcing

and protecting rights. For example, we have a substantive right to an attorney. Procedurally,

that would mean the court would inquire as to whether we have an attorney or appoint

one to us in some cases if we are not able to afford one.

Civil Law and Criminal Law. Civil

private rights and duties between persons and government. Criminal

Public wrongs against society. National and International Law.

National Laws of a particular nation.

International Body of written and unwritten laws observed

by nations when dealing with each other.

Constitutional Powers of Government Federal Form of Government

Federal (U.S.) constitution was a political compromise between advocates of state sovereignty

and central government. You've probably heard of "Separation of Powers."

Legislative, Executive and Judicial branches provide checks and balances.

Legislative Enacts laws

Executive Enforces laws

Judicial Interprets laws (declares laws/actions unconstitutional)

Let's look specifically at the Commerce Clause! U.S. Constitution

Gives Congress the power to "regulate Commerce with foreign Nations, and among the several

States, and with the Indian tribes." (Art. 1 § 8)

Among the several states means "interstate commerce."

Greatest impact on business than any other Constitutional provision. It's called the

"Commerce" clause! U.S. Supreme Court has interpreted the Commerce

Clause over a long period of time. Gibbons v. Ogden (1824)

To Chief Justice Marshall, commerce meant all business dealings that substantially affected

more than one state. The national government had the exclusive power to regulate interstate

commerce. They even went so far in Wickard v. Filburn

(1942) to say that a farmer who produced their own wheat and consumed it would impact Interstate

commerce. Purely local production, sale and consumption

of wheat was subject to federal regulation. Pretty broad interpretation!

Heart of Atlanta Motel v. U.S. (1964) Motels that provided public accommodations

were subject to federal civil rights legislation. Motels are part of interstate commerce! People

tend to stay at motels during travel.

Commerce Clause Today Theoretically - The Constitution hasn't changed.

The federal government has unlimited control over all business transactions since any enterprise

(in the aggregate) can have a "substantial effect" on interstate commerce.

Actually, the Supreme Court (through a number of cases) has curbed the federal power and

given the states some power to regulate in areas that may impact interstate commerce.

There is broad regulatory power given to the states.

Tenth Amendment Reserves all powers to the states that have

not been expressly delegated to the national government.

Police Powers (broader than just the police). State have inherent "police powers" (health,

safety, morals and general welfare). The text also mentions the "Dormant" Commerce

Clause. U.S. Supreme Court has interpreted commerce

clause to give national government exclusive power to regulate.

States only have a "dormant" (negative) power to regulate interstate commerce.

Dormant power comes into play when courts balance state's interest vs. national interest,

e.g., internet transactions (not around when the Constitution was framed). There could

be a federal regulation that impacts states, but there could also be a state law that impacts

interstate commerce and the court might determine that the state has a significant interest.

For example, taxing goods that are purchased on the Internet.

Supremacy Clause Article VI of the Constitution

Provides that Constitution, laws and treaties of the United States are the "supreme law

of the land." So, in an area where Congress has been given

the power they can exclusively regulate. In some cases, there is Concurrent Power.

Which means that both the states and federal government share powers.

Preemption When Congress chooses to act in a concurrent

area, federal law preempts state law.

Business and the Bill of Rights Originally

Bill of Rights only applied to the federal government.

Ten written guarantees of protection of individual liberties from government interference.

Today The Bill of Rights has been "incorporated"

and applied to the States as well. Some protections apply to businesses.

As we go through them, we'll focus on how they relate to business.

First Amendment -- Freedom of Speech Right to Free Speech is the basis for our

democratic government. Symbolic Speech

Includes gestures, movements, articles of clothing (e.g. Texas v. Johnson, U.S. 1989

about burning the flag). The US Supreme Court has permitted reasonable

restrictions on speech. Balance government's obligation to protect

community vs. individuals right to speech. There's even Corporate Political Speech

Corporations have protected political speech to financially support candidates.

Commercial Speech (such as marketing or advertising) Given substantial protection. Any restrictions

by the government must: (1) Seek to implement substantial government

interest, (2) Directly advance that interest, and

(3) Must go no further than necessary to accomplish. Example is Bad Frog Brewery, Inc. v. N.Y.

State Liquor Authority (1998). This was a Michigan brewery that had a frog on its label

with its middle finder up. Denial of label on beer was unconstitutional because

it lacked a "reasonable fit" with state's interest in shielding minors from vulgarity.

Basically, there are other ways to prevent minors from seeing this label than just banning

it.

First Amendment -- Unprotected Speech U.S. Supreme Court has held that certain speech

is NOT protected: Defamatory speech.

Threatening speech that violates criminal laws.

Obscene Speech is defined as ... Patently offensive, violates community standards

and has no literary, artistic, political or scientific merit.

This includes regulating speech online ... for example:

Filters for computers in public libraries and public schools (CIPA, 2000).

Child pornography (PROTECT ACT, 2003). What about "hate" speech on the web?

For example, even bullying online.

First Amendment - Freedom of Religion First Amendment guarantees that "Congress

shall make no law respecting an establishment of religion, or prohibiting the free exercise

thereof..." Doesn't say that there has to be a complete

separation of church and state! Establishment Clause

No state-sponsored religion or preference for one religion over another.

Free Exercise Clause Guarantees that a person can hold and practice

any (or no) religious belief. Only the actions of the government -- not the individual -- are

prohibited. Example in textbook - Local ordinance banning

steel cleats on roads was unconstitutional because it was directed at the Mennonite religion

(Mitchell County v. Zimmerman, 2012).

Due Process Procedural

Government decision to take life, liberty or property must be fair.

Requires notice and fair hearing. Substantive

Focuses on the content or the legislation (the right itself).

Really, the amount of attention the court gives it depends on:

Fundamental Right (a lot more scrutiny) Requires compelling state interest.

Non-Fundamental Rational relationship to state interest.

Equal Protection Government must treat similarly situated individuals

(or businesses) in the same manner. So, it doesn't have to treat everybody the

same! For example, two people convicted may not have the same criminal history or the

same circumstances. Courts apply different tests for challenges

based on Equal Protection: Minimum scrutiny (Rational Basis Test)

Economic or social welfare Legitimate government interest

Intermediate Scrutiny Gender or legitimacy

Important government interest Strict Scrutiny

Fundamental right or suspect traits (e.g. race)

Compelling government interest

Privacy isn't specifically mentioned in the U.S. Constitution.

U.S. Supreme Court has implied it from the Constitution (e.g. Fourth Amendment protection

against unreasonable search

and seizures). Certainly in the news a lot lately!

Griswold v. Connecticut (1965) Found a right to personal privacy implied

in constitution, expanded in Roe v. Wade (1973). Federal Statutes in the area of privacy. For

example: HIPAA (1996) (healthcare privacy).

Technological Advances and Privacy Rights. Court Records. Is there an expectation of

privacy? USA PATRIOT ACT (2001)

That was quite a while ago. There has even been more recent technology issues around

the NSA and their ability to monitor.