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Solution Manual for Business Law: Principles for Today's Commercial Environment, 5th Edition

Solution Manual for Business Law: Principles for Today's Commercial Environment, 5th Edition offers structured learning with chapter-wise explanations and key points.

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    Chapter 1 THE NATURE AND SOURCES OF LAW RESTATEMENT This chapter provides the students with a look at the nature, origin and importance of individual rights and how those rights are protected by laws and judicial process. The chapter provides a historical look at the evolution of rights of individuals and how technology requires that laws be revised to provide protection for those rights. Students are introduced to the various sources of law and their interrelationships. Constitutional law, statutory law, administrative regulation, and case law (along with the principle of stare decisis and concept of precedent) are explained along with the role and historical significance of common law. The nature and role of the uniform state laws are explained along with a discussion of the distinction between substantive law and procedural law. The distinctions between legal and equitable remedies are also explained. STUDENT LEARNING OUTCOMES LO.1: Discuss the nature of law and legal rights . LO.2: List the sources of law. LO.3: Describe the classifications of law. INSTRUCTOR ’ S INSIGHTS Break the chapter down into three components – related Learning Outcomes are indicated in ( ) : 1. What is the nature of law and legal rights? (LO.1)  Discuss the nature and origin of rights : legal rights; individual rights; right of privacy  Present the evolution of the protection of rights 2. What are the sources of law? (LO.2) 3. What are the classifications of law? (LO.3)  Discuss the types of laws: substantive and procedural  Cover the origins and current status of equitable relief  Explain uniform laws CHAPTER OUTLINE I. What is the Nature of Law and Legal Rights? A. Legal rights are part of the law – principles that govern conduct and can be enforced in courts or by administrative agencies B. Individual rights 1. Freedom of speech 2. Right to due process 3. Duties accompany rights

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    C. The right of privacy 1. An example of a legal right developed by courts 2. Provides protections against unreasonable searches and seizures 3. Privacy affords protection against intrusion by others a. Educational privacy on grades – Buckley Amendment b. Abortion stems from privacy right c. Banking privacy rights D. Privacy and technology 1. New rules are needed as technology evolves 2. E - mail, EDI 3. Some criminal sanctions CASE BRIEF: Fawcett v. Altieri 960 N.Y.S.2d 592 (2013) FACTS: Gina L Fawcett (plaintiff) and her then - minor son, John, sued Sea High School and the parents of Nicholas Altieri (defendants) to recover damages for John’s eye injury that he sustained in an altercation with Nicholas during a tennis match with St. Joseph High School. The defendants made a discovery request for access to John’s social media accounts, including Facebook, MySpace , Friendster, Flickr, and others. Ms. Fawcett moved for protective order to prevent discovery of the information on these sites because John’s sites were not publicly available. ISSUE: Are social media accounts discoverable? HOLDING AND REASONING : The court held that a variety of factors must be considered before granting broad access to social media accounts, including privacy settings by the holder of the account, relevancy of the information to the litigation, and protections afforded by the various social media sites. The court’s decision provides the guidelines for determining whether the litigants in such cases will be able to have discovery access to each other’s social media sites. T he parties will have to do depositions and then renew the request once more factual information is available for the analysis of the request for access. ANSWERS TO DISCUSSION QUESTIONS 1. What are the interests that a court must balance in making decisions about discovery on social media accounts? The courts must balance the right of privacy vs. the right of the parties to know information posted that is relevant to the case, such as whether a plaintiff claiming physical injury has been shown involved in activities that defy the claims of injuries. Also, the courts, as with tangible evidence, want to prevent a fishing expedition for evidence and prevent the use of information about character that is not relevant to the case at hand, the damages, or injuries. 2. What are the court's concerns about how social media information will be used? That is might be used to just generally impeach someone’s integrity and is not relevant to the facts of the case. 3. What will the parties in this case have to do before the court can rule on the motion? There will need to be depositions so that that parties can ask each other questions about the information they want and what they believe is posted on these various sites. DISCUSSION PO INTS: Ethics & the Law Maybe a Little Too “LinkedIn” This feature will generate great discussion among students. Most of them are encouraged by their colleges and universities to get on LinkedIn in order to establish connection and have a network of support. LinkedIn can be a great resource, but what is on the page is publicly available and, for free. The premium service allows potential

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    employers to get unvarnished information about applicants by checking with others who worked at the company at the same time. Some interesting questions to think about are the fact that we have to resort to such means to get the truth because we cannot get the truth from the references that applicants provide. Is this more of a question of solving a problem with references vs. whether employers should be permitted to use the information posted on the site ? All LinkedIn users have agreed to have their profiles available. The information is there – users are trying to hone its use or perhaps require notification when others are accessing information not generally available through the use of the site. For employers, there is the issue of possibly tainting the hiring process – they find out more information on some applicants and not on others, which is disparate treatment and could result in inaccurate information and perhaps charges of discrimination because of different scrutiny given to different applicants. As usual, the law on privacy has not yet caught up to the nuances of information use and refinement on the Internet. DISCUSSION POINTS: E - Commerce & Cyberlaw A University's Access to Your Computer Discuss with the students college and university policies on use of campus servers. They have signed paperwork that indicates they understand that the university monitors their use – indeed, the university is required to do so, so as not to get cross - wise with copyright issues. Again, privacy rights are limited. II. What are the Sources of Law? A. Constitutional law – federal and state; historical development B. Statutory law – federal and state C. Administrative law D. Private law E. Case law, statutory interpretation, and precedent 1. Statutory interpretation 2. Principle of stare decisis – precedent is followed unless there is a change in facts or need for change (e.g., separate but equal was abandoned) 3. Common law is developed and refined by the courts F. Other forms of law: treaties and executive orders G . Uniform state laws 1. Written generally 2. Adopted on a state - by - state basis 3. Use the Uniform Commercial Code as an example; also include the Uniform Consumer Credit Code I II . What are the Classifications of Law? A. Substantive vs. procedural Explain the concept of common law as the body of unwritten principles based primarily on the usages and customs of the community that were organized and enforced by the courts. Describe how it fits into the legal system of today and how it is often altered by statute. The common law is referred to often in subsequent readings, and students tend to be confused about what it is, where it came from, and what role it plays in today ’ s legal system.

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    DISCUSSION POINTS: Sports & Entertainment Law When Players Break the Law and Owners Are Offensive Leagues and professional sports teams have their own sets of private laws. For example, the NBA owners are the governing body for all teams. That body must approve sales of the franchise as well as location of arenas along with all the other game - related issues, such as rules, sanctions, and fines. Teams can discipline players, but so also can the league. Those private law sanctions can be taken to court, as when Tom Brady took his four - game suspension for deflate - gate to court. However, there was a union issue involved in that situation and the federal courts have jurisdiction over labor disputes. B. Criminal law v. civil law 1. One (criminal) is harm to society 2. Other (civil) is harm to individuals 3. The red light: ticket v. damages to others C. Law vs. equity 1. Initially remedies were separate 2. Now remedies are provided by the same courts 3. Injunctions – the red - soled designer shoes ANSWERS TO QUESTIONS AND CASE PROBLEMS 1 . Privacy as a right . The right is the student’s and is one that allows students to have their grades remain private. The schools have a duty to ensure grades are not released to third parties without permission of the student. 2 . Sources of law . Statutory law such as ordinances, case law, precedent, common law, uniform state laws, constitutions, administrative regulations , treaties . 3 . Common law/sources of law . Statutes are codified law; the common law evolves by case precedent and has existed in unwritten form since England in some areas of law. 4 . Classifications of law. a. Procedural b. Substantive c. Substantive d. Procedural 5 . Uniform state laws . Law is not uniform throughout the United States because of a historical accident: the United States was never a single nation. As of now, there are 50 state governments and a federal government within the area we call the United States. This means that 51 political bodies have the freedom to their own law (provided constitutional rights are not violated). As a practical matter, this has not resulted in 51 different sets of rules of law because the common law has tended to dominate the legal system of most communities. As stated in the text, the uniform laws have been a “ nationalizing ” force. It is likely that among areas that are truly “ in business, ” there will be greater uniformity in the near future. In contrast, as to other matters where the need for uniformity is not as great, we can expect local variations in the law, encouraged by local economic and cultural differences. The Uniform Commercial Code and Uniform Partnership Act are examples of uniform laws. 6 . Privacy. Several issues should be raised: a. Terms and conditions of dorm residency b. Access issues and safety issues

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    There can be a right of privacy in a dorm room subject to disclosed university policies, processes and procedures. Just as landlords have access for emergencies, the university could have some limited access without breaching privacy. 7 . Privacy . Professor Phelps is wrong. His musings on his employer ’ s e - mail system are not private. There is no expectation of privacy and anything written can be reviewed by his employer. 8 . Precedent . Courts could disregard precedent when facts differ, circumstances change and social mores differ. Cases are examined for similarities as well as distinguishing factors. Courts don’t follow precedent when differences exist. 9 . Sources of law . A statute is passed by an elected body. A regulation is passed by an administrative agency. An administrative regulation is one passed by a federal or state agency. Its procedures for adoption are different from a statute which is a law enacted by Congress, a state legislature or a city or county governing body. Statutes are generally passed by elected officials whereas regulations are the actions of appointed officials who are government employees. Administrative regulations must be grounded in statutory authority. 1 0 . Law and equity . Equitable remedies suitable here; an injunction to stop the ad from being run . Legal remedies include money damages for use of Eminem's image . Now courts can award either legal or equitable remedies. Eminem and 8 Mile obtained an injunction against Audi – the company was prohibited from running the ad because of a likelihood of confusion and the continuing problem of use of an image or likeness without permission. Emphasize that only equitable remedies help Eminem and 8 Mile – damages cannot recoup for the continuing use. 1 1 . Types of laws. Local laws: zoning, dog licensing, bike licensing, traffic regulations, littering, loitering Federal laws: securities laws, antitrust laws, federal income tax, Social Security, labor laws, equal employment laws, environmental laws All laws are limited by constitutional constraints and protections. For example, local laws cannot take away rights afforded by the constitution. Federal laws also cannot violate constitutional rights. Later students will study preemption – areas that only the federal government can regulate under constitutional powers. 1 2 . Common law. Stare decisis is “ Let the decision stand ” or following case precedent. 1 3 . Law and precedent. The social media have resulted in many new laws (cyberbullying) as well as case law on issues such as whether Google, Yahoo, etc., must reveal identities. Throughout the remaining chapters you will study examples of issues evolving and precedent being set. These forms of social media have expanded greatly how widespread personal information is available to many we would not necessarily voluntarily give it to. So, for example, when you are authorized as someone’s friend, you can click on the Facebook sites of their friends and obtain information without them realizing that so many have such access. Employers can gain information through a Google search and social media sit e s that you might not volunteer. As a result, laws have developed to require elections on privacy controls for these sites. Other laws have developed to provide access to information about who is posting what on certain sites when criminal activity results. 1 4 . Sources of law . In this example, the court making the decision will be required to draw on any property law (personal) in the state as well as the common law on property ownership. There may also be some ordinances that cover sporting events or finding property. If there are intellectual property rights in the baseball, then federal law will apply. The areas of law that would govern would include state laws, statutes and case precedent on the transfer of property rights. There might also be some ordinances that would govern conduct and rights at public events such as a baseball game as well as rights on lost property.

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    15. Types of laws. The areas of law are private law (for her lease); state law for her CPA license renewal and incorporation; federal laws (Internal Revenue Code) for the knowledge and information for preparing the tax returns, state and federal employment law will apply to her relationship with her employee – wages, overtime, workers compensation, unemployment compensation, equality in the workplace, etc. That relationship will also have private law as Janice develops office rules and procedures. Local law applies to any use of the buildings and safety codes for the office and building. Credit and contract law (UCC and federal credit regulations) will apply to the contracts and purchases with Staples. LAWFLIX And Justice For All (1979) (R) An excellent film that gives an overview of the judicial system in Maryland. Rights, precedent and the role of lawyers are all topics for satire and analysis in the movie. A number of scenes could be used for class viewing: – O pening scene in which a defense lawyer (Al Pacino) fights to have a verdict set aside . – C losing scene in which Al Pacino delivers a passionate opening statement in which he turns on his client who he believes to be a guilty man. – S cene in the middle in which Pacino’s friend and colleague fails to follow procedure which results in the incarceration and suicide of Pacino's client . Random Hearts (2000) (R) A movie that explores the issue of privacy when a couple is killed in an airplane crash. Their spouses grapple with their privacy in the public eye as well as obtaining information on the couple ’ s travel plans and relationship. To access additional vi d e os that illustrate business law concepts, visit www.cengage.com/blaw/dvl. © 2017 Cengage Learning ® . May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password - protected website or school - approved learning management system for classroom use.

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    Chapter 2 THE COURT SYSTEM AND DISPUTE RESOLUTION RESTATEMENT A court is a government - established tribunal created to hear and decide matters brought before it. Courts have specific types or classes of cases assigned to them and over which they have authority; referred to as jurisdiction. The types of jurisdiction include original jurisdiction which is the authority to conduct the first proceedings in the case. Appellate jurisdiction is the authority to review the proceedings of other courts. Courts can have broad authority over a variety of cases, or general jurisdiction as with a trial court, or can have special or limited jurisdiction as with juvenile or probate courts. There are federal and state court systems. The federal court system consists of specialty courts such as tax court and bankruptcy courts, a general trial court called federal district court, the U.S. court of appeals and the U.S. Supreme Court. State court systems have a general trial court, called a county, circuit or superior court, an appellate court, and a state supreme court. When a dispute is taken to court, it begins with a plaintiff filing a complaint. The defendant answers the complaint by denying the allegations or counterclaiming. The parties may be represented by lawyers who are officers of the court trained to represent others in the presentment of a case. Following the pleadings in a case, the parties begin discovery whereby they determine the facts of the case through depositions, requests for production and interrogatories. Based on the evidence obtained during discovery, the parties may move for summary judgment which is a decision in a case in which the facts are not in dispute. A trial begins with voir dire, or the process of questioning jurors for bias or arbitrary exclusion through the use of peremptory challenges. The trial proceeds with opening statements and then the plaintiff's case. The order for questioning witnesses is direct, cross - , redirect, and recross - examination. A directed verdict can be granted if the plaintiff's proof was insufficient to establish the elements of the case. Following a jury verdict, the losing party can move for a judgment N.O.V. or a new trial. The collection of a judgment is obtained through execution on a writ of execution or garnishment. Other methods, besides litigation, that can be used to settle disputes are called alternative dispute resolution. The methods of alternative dispute resolution include arbitration, mediation, medarb, reference to third person, association tribunal, summary jury trial, rent - a - judge, minitrial, contract provisions and ombudsmen. These methods vary in formality but are all non - judicial means for dispute resolution. STUDENT LEARNING OUTCOMES LO.1: Explain the federal and state court systems. LO.2: Describe court procedures. LO.3: List the forms of alternative dispute resolution and distinguish among them. INSTRUCTOR ’ S INSIGHTS Break the chapter down into three components – related Learning Outcomes are indicated in ( ) : 1. What are the court systems and names of the various courts? (LO.1)  Cover the federal court system  Explain generally how state court systems work  Discuss the types of courts and their jurisdiction

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    2. How does a case go through a court? (LO.2)  List the parties involved in a court case  Explain the initial steps in a law suit  Describe how a trial proceeds  Discuss the parties' options after a trial is finished 3. What are the alternatives to litigation for dispute resolution? (LO.3)  Explain arbitration  Discuss mediation  Cover MedArb  Define and discuss reference to a third person, association tribunals, summary jury trials, rent - a - judge, mini - trial, contract provisions, and ombudsmen as alternative means of dispute resolution CHAPTER OUTLINE I. What are the Court Systems and Names of the Various Courts? A. Types of courts 1. Subject matter jurisdiction – courts have authority based on type of case 2. Original jurisdiction – trial courts; where case is heard initially 3. General jurisdiction – authority of broad subject matter in cases 4. Limited or special jurisdiction – narrow scope of subject matter; e.g., probate, domestic relations, juvenile courts 5. Appellate jurisdiction – court that reviews the work of other courts a. Reversible error – mistake in lower court with the potential to affect the outcome b. Court can affirm, reverse, or remand CASE BRIEF: Stanford v. V.F. Jeanswear, LP 84 So.3d 825 (Miss. App. 2012) FACTS : Mary Kay Stanford (Stanford) was driving a truck for V.F. in late evening of February 7, 2006 when she began to feel nauseous. She pulled into a truck scale house to rest for the evening. She parked the truck, and as she attempted to climb into the sleeper compartment, she tripped over a cooler. Stanford fell into the sleeper compartment and hit her head on the bed rail; the fall knocked her unconscious. Stanford's husband, William Stanford, who was riding with her, attempted to revive her. After she regained consciousness, William offered to take her to the emergency room. Stanford declined and decided to stay in the sleeper compartment and rest until morning. Stanford contacted V.F . dispatch and made the notifications to the company about her injury. The company arranged for the two to return home. On February 8, 2006, Stanford went to Dr. Allie Prater for an evaluation of her injuries. Dr. Prater's notes reflect that Stanford's chief complaints were blackouts, syncope, and slurred speech. Stanford told Dr. Prater that her symptoms had begun one week prior to her visit. Dr. Prater's notes do not mention Stanford's fall in the truck or that she was knocked unconscious. Dr. Prater diagnosed Stanford with benign essential hypertension and ordered blood tests, an ultrasound, and a brain MRI. Upon receiving the test results, Dr. Prater referred Stanford to Dr. Glenn Crosby, a neurosurgeon. Before seeing Dr. Crosby, Stanford presented to Dr. Johnny Mitias, an orthopedic surgeon, on March 15, 2006. There was no mention of her fall in Dr. Mitias’s notes. In fact, he noted that “[t]here was no injury that started this.” Dr. Mitias diagnosed Stanford with right sciatica and ordered physical therapy. On March 31, 2006 , Dr. Crosby diagnosed Stanford with symptomatic cervical spondylosis with

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    osteophyte complex and ordered physical therapy. The physical therapy aggravated Stanford's symptoms, so Dr. Crosby recommended a cervical diskectomy and fusion at C3 – 4. Dr. Crosby performed the recommended surgeries on August 8, 2006. After surgery, Stanford began complaining of pain in her left buttock and down her left leg. Dr. Crosby ordered a lumbar MRI, which revealed a large rupture of the lumbar spine at L4. On November 28, 2006, Dr. Crosby performed a diskectomy at the L4 level. Dr. Crosby's notes indicate that Stanford “had a fall this past year” that may have aggravated her back. However, Dr. Crosby's notes do not mention that Stanford suffered a fall at work until her follow - up visit with Dr. Crosby on May 30, 2008. Dr. Crosby testified in his deposition that prior to that visit, Stanford had not disclosed any history of an accident at work. However, he testified that the problems with her neck and back were probably related to her work injury. A hearing was held before an administrative judge (AJ), who denied Stanford's claim for workers' compensation benefits . Stanford appealed the AJ's decision to the Commission, which affirmed the AJ's decision. Stanford appealed the Commission's decision to the Circuit Court of Union County, and the circuit court affirmed the Commission's decision denying benefits. Stanford then appealed. ISSUE: Was the admission of the evidence about the cruise and horseback riding and hairy chest contest prejudicial and a basis for reversible error? HOLDING: No, REASONING: The evidence was damaging to Stanford’s case but was not prejudicial particularly given that the AJ let in all sorts of evidence for Stanford from family and friends. The court affirmed the denial of workers’ compensation benefits because the evidence indicated clearly that Stanford did not tell the doctors about her work injury. The testimony about the cruise and the videos of horseback riding were damaging to Stanford’s case, but they did not indicate bias particularly because the AJ had allowed evidence from Stanford’s husband, friends , and relatives about her condition. Because evidence is damaging to one party does not mean that it should not be admitted . ANSWERS TO DISCUSSION QUESTIONS 1. What was the issue with Mary Kay Stanford and her doctors that was so significant? There were issues about previous injuries and inconsistency in her stories and statements to doctors. 2. What impact do you think the cruise and horseback riding video had on the case? That type of evidence can be determinative of the outcome because these kinds of activities show that the plaintiff was not as injured as she claimed. 3. If evidence harms a party's case, is it biased and, therefore, must be withheld? No, the weight of the evidence is considered along with its prejudicial impact. That the evidence is harmful to a case does not mean it should be excluded. B. Federal court sys tem (See Figure 2 - 1 ) 1. Federal district court (See Figure 2 - 2 in text) a. Trial court b. General jurisdiction i. U.S. is a party ii. Cases between citizens of different states ($75,000 or more) iii. Cases arising under U.S. Constitution or statute c. Each state is at least one federal district d . Specialty courts i . Limited jurisdiction ii . Bankruptcy, tax, Indian tribal court 2 . U.S. Court of Appeals a. Twelve geographic circuits (districts grouped together) plus one additional circuit b. One court of appeals per circuit c. Three - judge panel reviews cases

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    3 . U.S. Supreme Court a. Appellate jurisdiction i. U.S. Courts of Appeals ii. State supreme courts when constitutional issue is involved b. Review is granted pursuant to writ of certiorari process c. Trial court for ambassadors, public ministers, consuls and state vs. state C. State court systems (See Figure 2 - 3 in text) 1. General trial courts: civil and criminal jurisdiction 2. Specialty courts – probate, family 3. City , municipal , and justice courts 4. Small claims courts 5. State appellate courts 6. State supreme courts II. How Does a Case Go Through a Court? – Court Procedure A. Participants in the court system 1. Plaintiffs – initiates proceeding (criminal case: prosecutor) 2. Defendant – party against whom proceedings are brought 3. Judge – presides over proceedings 4. Jury – citizens sworn to reach a verdict B. Which law applies – conflicts 1. Law of state in which court is located governs procedural questions 2. Law of state in which contract was made governs 3. Choice of law provisions in contracts govern C. Initial steps in a lawsuit 1. Complaint – states cause of action – commencement of lawsuit 2. Service of process – notifies defendant 3. The defendant's response and the pleadings a. Answer and/or counterclaim – also called the pleadings b. Motion to dismiss – demurrer c . Deny 4. Discovery – process of learning the evidence that exists prior to trial a. Deposition – sworn testimony not in court room; can be used to impeach differing recollection or testimony at trial b. Interrogatories – questions answered under oath c. Requests for production of documents – obtaining paper evidence

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    5 . Motion for summary judgment – asks for decision when facts are not in dispute 6 . Designation of expert witnesses D. The trial 1. Jury selection a. Voir dire examination – use Martha Stewart example from text and on website update b. Challenge for cause – bias, conflict c. Peremptory or arbitrary challenge – lawyer need not give reason 2. Opening statements 3. P resentation of evidence a. W itnesses are examined by direct, cross - , re - direct, and recross - examination b. Roles change according to who is presenting his/her case 4. Motion for directed verdict granted if plaintiff did not establish case DISCUSSION POINTS: Ethics & the Law Honesty, Lawyers, and BP Claims The lawyers should have declared their conflicts of interest, which would have made them ineligible to participate in representing claimants in some cases and required public disclosure in others. At a minimum, they all should have disclosed their interests to the government supervising the claims office. They did not make the disclosures because they would have lost out on the amount to be collected from the funds. As the final report on the fund concluded, there were fraudulent claims, double payment, and conflicts of interests that resulted in abusive and nonexistent claims. DISCUSSION POINTS: Thinking Things Through Why Do We Require Sworn Testimony? Discuss with students the inconsistency in the statements. The oath makes a difference in what is said. Discuss the ethics of Microsoft’s differing positions. 5 . Closing argument or s ummation 6 . Motion for mistrial DISCUSSION POINTS: E - Commerce & Cyberlaw Google’s Impact on T rials What are the implications of your Internet connections? Should you always disclose that you are friends with someone involved in the case during jury selection? Discuss how often Google has become an issue in cases. Discuss the importance of jurors using only the evidence presented. Discuss importance of following the Judges’ cautions and being forthright. 7 . Jury instructions 8 . Jury verdict or mistrial if deadlocked 9 Motion for new trial or judgment N.O.V. (judgment non obstante verdicto ) E . Posttrial procedures: Recovery 1 . Costs

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    2 . Attorney fees 3 . Execution of judgment and suit 4 . Writ of execution or writ of garnishment III. What are the Alternatives to Litigation for Dispute Resolution (ADR) ? (See Figure 2 - 4 in text) A. Arbitration 1. Means of avoiding expensive legal costs 2. Federal Arbitration Act and Uniform Arbitration Act govern 3. Arbitration can be mandatory or elective 4. Scope of arbitration: as broad as possible 5. Finality of arbitration a. Usually provided for by the parties b. If non - binding, any litigation begins anew for a trial de novo B. Mediation 1. No authority to make a decision 2. Third party is a go - between to facilitate communication C. MedArb – party has authority to hear case and suggest resolution to each side D. Expert panel: a method to focus in on technical issues and singular issues as in construction contracts E . Reference to third person: case is given to outsider(s) – ordinarily, parties agree that the decision is final F . Association tribunals 1. These groups have a board or committee to settle disputes 2. The National Association of Home Builders requires arbitration G . Summary jury trial: a dry run or mock trial to see how the case is perceived H . Rent - a - Judge: an experienced judge is hired to hear the case I . Minitrial: heart of dispute is heard; parties agree to limit issues of dispute J. Contract provisions can set parameters of ADR, type of ADR, etc. ANSWERS TO QUESTIONS AND CASE PROBLEMS 1. Trial process. Steps in litigation: 1. Complaint by plaintiff 2. Service of process on defendant 3. Defendant's answer: deny, counterclaim, admit 4. Discovery: depositions, interrogatories, requests for production 5. Motion for summary judgment (if no factual issues) 6. Trial a. Jury selection: voir dire, challenge for cause, peremptory challenge b. Opening statements c. Plaintiff's case: direct, cross, redirect, recross

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    d. Motion for directed verdict e. Defendant's case f. Summation g. Jury instructions h. Jury verdict or mistrial (deadlocked) i. Motion for new trial or judgment j. Recovery: fees, execution, garnishment 2. Arbitration . The benefits are, in theory, that alternatives are faster. However, these arbitration methods are now dragging out nearly as much as a trial . ADR allows for no public hearing and all the problems that go along with the media covering a contract dispute. These methods allow the parties to gain the perspective of an outside part y , something that often needs to be done in order to move the parties forward in their negotiations. 3. Jurisdiction . Ralph’s case will go to federal district court because it is a trial involving a violation of a federal statute. 4 . Trial process. No. Jerry could be removed for cause. There is a conflict with his independence. 5 . A rbitration . The danger feared by the three developers is a real one. It would be better for them to agree to submit the matter to arbitration. Persons who were experienced with real estate developments and the law of such developments could be selected as arbitrators; this would eliminate the potential dangers. 6. Mandatory arbitration clauses . The U.S. Supreme Court held that the arbitration clause was valid because (1) there was strong federal policy favoring arbitration; and (2) the party challenging the validity of an arbitration clause has the burden of showing that arbitration is an unsuitable method for resolving the dispute. In this case, Mrs. Randolph had alleged that the arbitration costs made pursuit of her remedies too expensive. However, she had not presented evidence to indicate why arbitration would be more expensive than litigation. [ Green Tree Financial Corp. v . Randolph , 531 U . S . 79] 7 . Expert witnesses; evidence . The answer can be found in the Yates case. When an expert does not disclose evidence that helps to evaluate his or her credibility, there has been a reversible error that is grounds for reversal. This information that the expert has been a defendant in a case and lost goes to their expertise and credibility both. 8 . Types of courts. (a) Small claims court – original; limited (b) U.S. Bankruptcy court – ori ginal; limited (c) Federal district court – general; original (d) U.S. Supreme Court – appellate; original (e) Municipal court – limited; original (f) Probate court – limited; original (g) Federal or U.S. Court of Appeals – appellate 9 . Discovery . Yes, the Pension Fund would be entitled to have access to determine whether Mr. Ellison had said anything that contradicted his public statements. The court did , in fact , allow the Pension Fund to have access. However, all but 15 of the e - mails had been destroyed. The court did not sanction Mr. Ellison, but it did allow the jury to have an instruction read that allowed them to presume that those e - mails contained information that would have been adverse to Mr. Ellison. [ Nursing Home Pension Fund, Local 144 v. Oracle Corp., 380 F. 3 d 1226 (9 th Cir.)] 1 0 . Federal Arbitration Act . Yes. When the seller delivered pursuant to the purchase order, it became bound by the terms of the purchase order, including the arbitration clause of that order. Because the buyer and seller were corporations of different states, the contract between them related to an interstate transaction. The Federal Arbitration Act was therefore applicable, and the arbitration agreement was made binding by the act. Both parties were required to arbitrate the dispute. [ Application of Mostek Corp., 502 N.Y. S.2d 181 (App. Div.) ] 1 1 . Arbitration/mandatory clauses . The presumption that arbitration clauses in contracts (here in a collective bargaining agreement) are valid and enforceable does not extend to those statutory rights that parties to the contract may have. In this situation, the employee had a clear right to pursue remedies under federal statute and by litigation. For that right to be waived and the case to go to arbitration, the contract must expressly provide that these statutory rights are waived. The waiver must be clear and unmistakable and, in this case, the language was not enough to indicate a waiver of right to litigation under the ADA. The arbitration clause in the union collective bargaining agreement is too general to indicate a waiver of rights. The court reversed and remanded the case for trial. Distinguish for the students the difference between these litigation rights and generic statutory protections, such as in the Green Tree case, that provide simple remedies and not a specific right of litigation. Also, point out that union, disability and labor issues have an extensive federal statutory scheme with rights,

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    protections and processes that would require more than a generic arbitration clause. [ Wright v. Universal Maritime Service Corp., 525 U.S. 70] 1 2 . T rial; jury selection . The lawyers can obtain information about prospective jurors through questionnaires as well as the process of voir dire . Some of the background questions on voir dire are place of employment and whether they know any of the parties in the case. Mr. Guber could be excused because of his relationship with Ms. Ryder. The prosecuting attorney could find this out using voir dire , the process of questioning the jury panel for screening them for bias, connection and relationship. The attorney could use a challenge for cause or a peremptory challenge. In the Ryder case, both sides let Mr. Guber remain and he served on the jury after his assurances that he would be impartial. Ms. Ryder was found guilty of theft and burglary. She was sentenced to community service and probation. [Rick Lyman, “For the Ryder Trial, a Hollywood Script,” New York Times, November 3, 2002, SL - 1] 1 3 . Binding arbitration; finality. Genera lly arbitration awards are not set aside by courts. Unless there is fraud involved, the decision stands even when it appears that the arbitrator’s decision is very different from expectations. Arbitration is set aside only in rare circumstances (misconduct) of it the parties' agreement/contract allows for an appeal. 1 4 . Discovery evidence . Trial. On cross - examination, the lawyer can confront the witness on the business practice. 15. Arbitration Arbitration agreements can be enforced under Federal Arbitration Act (FAA) without contravening policies of congressional enactments giving employees specific protection against discrimination prohibited by federal law. Section 1 of the Federal Arbitration Act (FAA) excludes from the Act's coverage "contracts of employment of seamen, railroad employees, or any other class of workers engaged in foreign or interstate commerce." 9 U.S.C. § 1. All but one of the Courts of Appeals which have addressed the issue interpret this provision as exempting contracts of employment of transportation workers, but not other employment contracts, from the FAA's coverage. A different interpretation has been adopted by the Court of Appeals for the Ninth Circuit, which construes the exemption so that all contracts of employment are beyond the FAA's reach, whether or not the worker is engaged in transportation. It applied that rule to the instant case. The U.S. Supreme Court decided that the Ninth Circuit was wrong and that the better interpretation is to construe the statute, as most of the Courts of Appeals have done, to confine the exemption to transportation workers. Adams is subject to arbitration and such arbitration does not deprive him of his rights under the antidiscrimination laws. [ Circuit City Stores, Inc. v. Adams, 532 U.S. 105 ] © 2017 Cengage Learning ® . May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password - protected website or school - approved learning management system for classroom use.

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    Chapter 3 BUSINESS ETHICS, SOCIAL FORCES, AND THE LAW RESTATEMENT This chapter provides the students, first, with a look at business ethics: What is business ethics? Why is business ethics important? How do I resolve ethical dilemmas? The concepts of positive law and natural law are covered along with notions of moral relativism and stakeholder theory. The importance of trust and reputation in business ethics and business financial performance is highlighted through examples and studies. Issues of business and social responsibility are also covered with discussions of Milton Friedman’s views as an economist on social responsibility in comparison to those of Body Shop International founder and philanthropist, Anita Roddick. The correlation between and among ethics, public policy and law is highlighted in this chapter with examples of consumer movements and laws passed in response to social forces. This discussion then facilitates further discussion of the purposes of law including protection of rights and preserving both stability and flexibility. Following a discussion of the categories of ethical breaches, simple models for analyzing ethical dilemmas are included to help the students resolve issues presented in the chapter. The models include the simple Blanchard/Peale three - question model (Is it legal? Is it balanced? How does it make me feel?), the front - page - of - the - newspaper - test, and Laura Nash’s model of breaking down the dilemma in order to confront cause, intention and disclosure. STUDENT LEARNING OUTCOMES LO.1: Define business ethics. LO.2: Discuss why ethics are important in business. LO.3: Describe how to recognize and resol v e ethical dilemmas. INSTRUCTOR ’ S INSIGHTS Break the chapter down into three components – related Learning Outcomes are indicated in ( ): 1. What is business ethics? (LO.1)  Explain what business ethics is  Discuss the various ethical standards and schools of thought  Describe the business stakeholder theory and stakeholder analysis  Explain Milton Friedman's view on social responsibility 2. Why is business ethics important? (LO.2 )  Trust  Financial performance  Reputation  Business ethics and business regulation: public policy, law and ethics 3. How to recognize and resolve ethical dilemmas. (LO.3)  Categories of ethical behavior  Resolving ethical dilemmas CHAPTER OUTLINE I. What is Business Ethics? A. Business ethics is balancing goal of profits with values of individuals and society

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