Source of information: THE LEGAL ENVIRONMENT OF BUSINESS: A MANAGERIAL APPROACH: THEORY TO PRACTICE. Published by McGraw-Hill/Irwin, a business unit of The McGraw-Hill Companies, Inc., 1221 Avenue of the Americas, New York, NY, 10020. Copyright © 2011 by The McGraw-Hill Companies, Inc. All rights reserved.

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Chapter 1: LEGAL FOUNDATIONS

My interpretation of law is that these are legally-backed rules of action and conduct that have been created to promote and protect the moral and ethical expectations of society. The primary sources of law are constitutional, statutory, administrative, and common---are found at federal, state, and local levels. Constitutional law is the foundation for all other law in the United States and is the supreme law of the land. Statutory law is created by a legislative body and approved or disapproved by the executive branch of government. Administrative law is the source of law that authorizes the exercise of authority by executive branch agencies and independent government agencies. Common law is essentially law made by the courts and that has not been specifically passed by legislature, and is based on the fundamentals of previous cases that had similar facts. There are also secondary sources of law which are intended to increase the level of uniformity and fairness across courts in all 50 states. Secondary sources of law have no independent authority of legally binding effect. The categories of law are as follows: Civil laws are designed to compensate parties for losses as a result of another's conduct. Criminal laws are a protection of society, and the violation of criminal laws results in penalties to the violator such as fines and imprisonment. Substantive laws provide individuals with the rights to create certain duties. s Public laws are those derived by some public entity. Private laws are recognized as binding between two parties even though no specific statute or regulation provides for the rights of the parties. —————

Chapter 2: BUSINESS AND THE CONSTITUTION

The U.S. Constitution is composed of a preamble, seven articles, and 27 amendments.

The preamble states the Constitution's broad objectives. The articles set out the structure, powers, and procedures. Articles establish the legislative, executive, and judicial branches. Articles also establishes relationships between state and federal government; and provides processes and requirements of the Constitution. Amendments are additions or changes to the Constitution since its ratification.

The U.S. Constitution regulates the federal system of law by providing the foundation for which the federal system of law is structured, operated, and carried out. It provides the precedent and basis for all laws of the land.

The structure of the federal government is divided into different branches that are given certain powers to act on. The separation of powers are used as checks and balances to the other branches to ensure that no one branch has too much power.

Congress has the opportunity to use the commerce clause to strike down any state law that overstep federal laws regarding interstate commerce. The commerce clause says that federal law regulates the interaction of properties and actions that can potentially affect interstate and intrastate economies. The commerce clause promotes the open and fair-use of passageways and facilities in order to sustain interactions of the interstate economy.

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Chapter 3: THE AMERICAN JUDICIAL SYSTEM, JURISDICTION, AND VENUE

Miguel buys a truck in Texas, then moves to Washington. A year later, he is driving his truck in Oklahoma, and causes an accident by running into another car, whose driver is from Florida. In what states will the other driver be able to sue Miguel? State the reasons for your answer. The case will likely need to go to state trial court because they will hold the jurisdiction on this type of case. After considering subject matter jurisdiction and personal jurisdiction, the injured driver can sue Miguel in Washington. The state of Washington would need to have a state long-arm statute in order to grant specification authorization to Oklahoma over Miguel's case. However, since Miguel was just visiting Oklahoma as was the other driver, assuming, both drivers do not have the minimum level of contacts---the states will most likely not grant this authorization. The state of Florida will not have personal jurisdiction over Miguel either because he does not meet the minimum level of contacts in the state. Texas is not considered because they have no business connection to the case other than the sale and purchase of a privately owned vehicle.

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Chapter 4: RESOLVING DISPUTES: LITIGATION AND ALTERNATIVE DISPUTE RESOLUTION

Civil litigation is the term used to describe a dispute resolution process where the parties and their counsel argue their view of a civil (noncriminal) controversy in a court of law. If the issues are relatively simple, this can be a cost-effective method to resolve a dispute fairly.

The stages of litigation are pretrial, trial, and post trial.

During pretrial there is demand and preligation settlement negotiations.
During trial is the jury selection and opening, testimony and submission of evidence, closing arguments and charging of jury, and deliberations and verdict.
During post trial are the motions and appeals, and finally procedures to collect the judgment.

Alternative Dispute Resolution (ADR) is the process (usually in a private setting) by which disputes involving individuals or businesses are resolved outside of the federal or state court system through the help of third parties.

The advantages of ADR versus litigation is costs, preserving business relationship, time, expertise, and privacy.

Examples of informal ADR are settlement agreements, and revised contracts. Examples of formal ADR are arbitration, mediation, expert evaluation.

I work in the electronic manufacturing industry and the company I work for has customer contracts to assemble and produce electronic kits. Arbitration would be a beneficial method for resolving a dispute between my company and a parts supplier, in a situation where there was delayed delivery of a product due to component part shortages. Depending on the details of a contract, the supplier could be deemed responsible for losses caused by the delayed delivery of the product to the customer.

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Chapter 25: INTERNATIONAL LAW AND GLOBAL COMMERCE

Most legal sources define modern international law as a body of rules and principles of action binding on countries, international organizations, and individuals in their relations with one another.

One important distinction necessary to understanding international law is that it may be categorized as either public international law, which primarily addresses relations between individual countries and international organizations, and private international law, which focuses on regulation of private individuals and business entities.

In one sense, the primary source of international law is the body of law in each individual country. However, international law can also provide individual countries with some degree of harmonized standards that increases reliability and encourages fairness, due process, and barrier-free trade among nations. Therefore, treaties, customs, and judicial decisions are also considered to be sources of international law.

A treaty is any agreement between two or more nations to cooperate in a certain manner. Treaties may be related to defense, trade, extradition, and other matters between two countries.

Along with treaty law, customary international law is a primary source of law affecting individuals and businesses engaged in international transactions. Customary law follows the basic principle of international law that individual conduct is permitted unless expressly forbidden.

Most treaties and national laws recognize both an international tribunal, such as the International Court of Justice (discussed later), or a ruling by a national court applying international law principles. One important concept related to judicial decisions as a source of international law is comity. Comity is the general notion that nations will defer to and give effect to the laws and court decisions of other nations. However, comity is not a legal doctrine that requires courts to accept the judgments of foreign courts. Rather, it is rooted in the idea that reciprocal treatment is a necessary element of international relations.

International organizations play a unique role in the development of international law. These organizations are typically structured through use of multinational representation and are created and regulated by treaty.

Perhaps the most famous organization is the United Nations (U.N.), which was created after World War II to facilitate common international concerns on defense, trade, protection of human rights, and other matters. From a business perspective, the U.N. has made significant achievements in harmonizing laws related to the sale of goods between businesses in different countries and other international business transactions. The World Trade Organization (WTO), which promotes and has certain authority over disputes involving trade barriers.

The International Monetary Fund (IMF), which is intended to promote stability of world currencies and provide temporary assistance for countries to help prevent the collapse of their economies.

The Organization for Economic Cooperation and Development (OEDC), which coordinates aid to developing countries and takes steps toward eliminating bribery and other corruption from developing economies.

International courts play a role in the development and interpretation of international law, but their power to enforce a ruling on sovereign nations can be tenuous and their jurisdiction may be limited.

The International Court of Justice (also known as the World Court ) is the judicial branch of the United Nations. It is based in the Netherlands and its main functions are to settle legal disputes submitted to it by member states and give advisory opinions on legal questions submitted to it by duly authorized international organs, agencies and the U.N. General Assembly.

The European Court of Justice sits in Luxembourg and is the final arbiter of the codes governing European Union (EU) member countries. The court is composed of judges from each EU member country and is structured in a civil law tradition, so that most of its procedures and decisions are based on treaties governing EU countries regarding commercial regulations, protections, and guarantees. National courts of EU members are obliged by treaty to honor the decisions of the court and are obligated to apply EU laws (known as community laws).

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Chapter 9: TORTS AND PRODUCTS LIABILITY

A tort 1 is a civil wrong where one party has acted, or in some cases failed to act, and that action or inaction causes a loss to be suffered by another party. The law provides a remedy for one who has suffered an injury by compelling the wrongdoer to pay compensation to the injured party. Tort law is best understood as intending to compensate injured parties for losses resulting in harm from some unreasonable conduct by another.

An intentional tort is one where the tortfeasor was willful in bringing about a particular event that caused harm to another party. Negligence is an accidental (without willful intent) event that caused harm to another party. The difference between the two is the mind-set and intent of the tortfeasor. Strict liability torts, where a tortfeasor may be held liable for an act regardless of intent or willfulness, applies primarily in cases of defective products and abnormally dangerous activities (such as major construction demolition).

Tort law also applies in circumstances when one party fails to act reasonably and, even though that party does not intend for harm to occur, the party is still liable for any injuries or damages suffered by another party as a result of the unreasonable conduct.

* Duty: Did the tortfeasor owe a duty of care to the injured party?
Cain then shoots and kills Abel later that afternoon. Cain is sentenced to a life term, so Abel’s heirs sue the owners of the shock-host television show for negligence, claiming they owed Abel a duty to protect him from Cain. In this case, a court will likely rule that due to the time period between the show and the shooting (three days), and the fact that no incident occurred on the show or immediately thereafter, the duty owed to Abel ended when the show ended and did not extend to the time of the incident.

* Breach of duty: Did the tortfeasor fail to exercise reasonable care?
For example, the state legislature passes a law requiring that construction companies provide hardhats for all workers and visitors on a construction site.

■ Cause in fact: Except for the breach of duty by the tortfeasor, would the injured party have suffered damages?
For example, suppose that Donald checks into Hotel’s twentieth-floor luxury suite. He watches a beautiful sunset while leaning on the balcony railing, but the railing snaps and Donald falls twenty stories

■ Proximate (legal) cause: Was there a legally recognized and close-in-proximity link between the breach of duty and the damages suffered by the injured party?
This limit applies because it was not reasonably foreseeable by Hotel that Donald would be injured by a tornado en route to the hospital

* Actual damages:
This means that the party alleging injury must prove that she suffered some type of physical harm derived from an injury caused by the tortfeasor

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Chapter 24: INTELLECTUAL PROPERTY

The Uniform Trade Secrets Act (UTSA) 2 defines trade secrets as information or articles that are to be kept secret because of its particular value.

A trademark is a word, symbol, or phrase used to identify a particular seller’s products and distinguish them from other products.

Trademark protection also extends beyond words, symbols, and phrases to include other aspects of the product such as shape or the color scheme of its packaging. These features are known as trade dress.

More precisely, copyright protection is an intangible right granted by the Copyright Act of 1976 6 (a federal statute) to the author or originator of an original literary or artistic production, where the artist is invested, for a specified period (see Table 24.1 ), with the sole and exclusive privilege of multiplying copies of the work along with the right to profit by publication and sale.

A patent is a government-sanctioned monopoly right that allows an inventor the exclusive entitlement to make, use, license, and sell her invention for a limited period of time. Patent rights are important in the entire businesses community, but are particularly vital to the manufacturing, technology, and pharmaceutical sectors.

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Chapter 6: OVERVIEW AND FORMATION OF CONTRACTS

Put another way, a contract is simply an agreement that a court of law will recognize and enforce.

Formation - Parties reached mutual agreement on terms. All formation elements are met. One party typically agrees to provide services, real estate, or goods in exchange for something of value (usually money).

Mutual assent means that in order for a contract to be valid, the parties must reach an agreement using a combination of offer and acceptance.

First, the agreement must be supported by consideration. Generally, a promise is supported by consideration if (1) the promisee suffers a legal detriment by giving up something of value or some legal right, and (2) the promisor makes his promise as part of a bargained for exchange. Second, the parties entering into the agreement must have capacity. Third, the subject matter and performance of the contract must have legality and be consistent with public policy.

Enforceability - Contract meets legal requirements to enforce terms.

Performance - Governs parties performing (or not performing) the terms of the agreement and provides compensation if one party fails to perform.

Under the theory of promissory estoppel, a relying party may recover damages if (1) the promisee actually relied on the promise (the promise must have induced the act); (2) the promisee’s reliance was reasonably foreseeable to the promisor (what an objectively reasonable person would have foreseen under the same circumstances); and (3) principles of equity and justice (did each party act in good faith and fair dealing) are served by providing compensation to the reliant party

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Chapter 7: CONTRACT PERFORMANCES: CONDITIONS, BREACH, AND REMEDIES

The law provides certain relief for aggrieved parties that suffer losses as a result of another party’s breach of contract. These relief mechanisms are collectively referred to as remedies.

Compensatory damages cover a broad spectrum of losses for recovery of actual damages suffered by the non breaching party. These damages are an attempt to put the non breaching party in the same position she would have been in if the other party had performed as agreed. Material breach of contract is when the fundamental terms of a contract have not been performed. The non breaching party has the right to terminate their obligation to the contract and can sue to recover monetary damages. Non material breach of contract is when the performance of the terms in the contract were not complied with, but the party is still obliged to complete the agreement. The non breaching party then has the right to sue for monetary damages that make up the differences from the original agreement.

Legal remedies for breach of contract include monetary payments for compensatory damages, and payment for indirect and consequential damages. Restitution prevents the unjust enrichment of one party in agreement by allowing the non breaching party to terminate the contract and sue to receive fair market value of the work performed. Liquidated damages is a predetermined agreement for a breach of contract.

Equitable remedies for breach of contract provide relief in the form of specific performance, injunctive relief, or reformation. Specific performance is when a court orders breaching party to render performance with a specific action. Injunctive relief is a court order to prevent the party from performing a particular act. A contract modification by the court is called a reformation.

The most common way for discharge of contract is good faith performance, but parties may also be discharged by mutual consent and operation of law.

An example of good faith performance would be a construction contractor that deviated from the plan due to a material shortage and unavailability. Both parties can then agree to the condition of the completed work through mutual consent. If the project is destroyed during construction from a hurricane, operation of law would indicate that the contract can be terminated.

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Chapter 10: AGENCY AND EMPLOYMENT RELATIONSHIPS

Understanding agency law also requires one to be aware of (1) legal requirements for creating an agency, (2) liability of a principal for the agent’s conduct, and (3) duties and obligations of the parties.

Individual employees who are authorized to transact business on behalf of the employer/ principal are called employee agents. Principals are liable for the actions or omissions
(such as negligence) of employee agents.

an independent contractor agent is not considered an employee and has no legal protections of employees such as minimum wage and overtime compensation laws. An equally important factor is that the principal generally has no liability for actions and omissions of an independent contractor agent. Agents who act on behalf of a principal without receiving any compensation are called gratuitous agents. In most respects, the rights and duties of a gratuitous agents are the same as those of paid agents except that the duty of care applicable to the gratuitous agent is not as great

When the third party entering into the contract is aware of the identity of the principal and knows that the agent is acting on behalf of the principal in the transaction, then the agency relationship is a fully disclosed agency.

If the third party knows that the agent is representing a principal, but does not know the actual identity of the principal, the agency relationship is a partially disclosed agency.

When a third party is completely unaware that an agency relationship exists and believes that the agent is acting on her own behalf in entering a contract, this is called an undisclosed agency.

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Chapter 8: CONTRACTS FOR SALE OF GOODS

The sale of goods are governed by statutory law in the form of the Uniform Commercial Code. The underlying policy of the UCC is to promote commercial efficiency by providing standardized procedures that merchants and consumers may rely upon.

Good faith is defined in the UCC as “honesty in fact in the conduct or transaction concerned.” 20 Additionally, merchants also have the duty to act in a commercially reasonable manner. Generally, this means that merchants (merchants only) must observe industry standards and practices that may be unique to a particular industry or field.

A party holds title to a good when (1) the goods are actually in existence in tangible form, and (2) when the goods are identified to the contract. 14 Identification takes place when the seller has marked or designated the good in some fashion (such as by serial numbers or lot designations).

Shipment contracts - the seller needs only to deliver the goods to the “hands” of the carrier to achieve complete performance.

Destination contracts - complete performance occurs when the goods have been tendered at the specified destination. (i.e., the seller delivered what the buyer actually ordered)

If the seller is a merchant, the risk of loss to goods held by the seller passes to the buyer only when the buyer takes physical possession of the goods. If the seller is not a merchant, the risk of loss to goods held by the seller passes to the buyer on tender of the goods. 18

Repudiation of the agreement - contracting parties have a right to cancel the contract even before any performance is due if it becomes clear that one party does not intend to perform as agreed

When the breach has occurred before the goods were actually received by the buyer, the seller may: Cancel contract, resell at fair market value, recovery damages from difference in original price and resell price, recover full value from buyer and discard goods.

In the case of nonpayment after the buyer has accepted (or such time has passed that the buyer is assumed to have accepted) the goods, the seller may recover the entire contract price plus incidental damages.

The UCC provides buyers with the immediate remedy of rightful rejection of all or part of the lot when the seller delivers nonconforming goods.

The UCC provides the buyer with an option to take immediate steps by canceling the contract and purchasing substitute goods from another vendor, known as cover, in order to continue business operations.

The UCC gives the buyer the right to sue the breaching party for damages sustained due to the breach.

The UCC provides the buyer with a remedy of specific performance, which allows the buyer to obtain a court order that compels the breaching party to perform his obligation under the contract.

Buyers who have accepted the goods that turn out to be defective or nonconforming may still recover for any losses by revoking acceptance.

The UCC gives protection to the buyer by making it clear that the buyer does not give up the right to sue the seller for the buyer’s damages resulting from the seller’s delivery of nonconforming goods. 36

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Chapter 10: CHOICE OF BUSINESS ENTITY, SOLE PROPRIETORSHIPS, AND PARTNERSHIPS

A sole proprietorship requires only a minimal fee and a straightforward filing requirement with the appropriate state government authority and typically requires no annual filings. Its ease of formation and maintenance makes this entity a top choice for start-up businesses with relatively low annual revenues and expenses. A sole proprietorship business is not subject to corporate income taxation and no tax return is filed on behalf of the business. Rather, the principal reports business income and expenses on her own individual tax return and pays taxes on business income (or deducts business losses) based on her own individual tax rate. The chief drawback to this form of entity is a complete lack of protection of the principal’s personal assets for unpaid debts and liabilities of the business.

Fundamentally, a general partnership is thought of as (1) an association of two or more people or entities,
(2) who are co-owners and co-managers of the business, and that (3) share in the profits of an ongoing business operation. General partners’ personal assets are at risk both together (jointly) and separately (severally) for all debts and liabilities of the partnership regardless of the source of the debt or liability. partnership entity pays no level of corporate tax. Rather, profits are taxed after they pass through the business and are distributed to the individual partners. The income is reported on the individual general partner’s personal tax return (the familiar tax form 1040) and taxed based on the individual rate of the general partner.

A limited partnership is an entity that exists by virtue of a state statute that recognizes one or more principals as managing the business enterprise, while other principals participate only in terms of contributing capital or property. The limited partner’s liability is limited to whatever the limited partner contributed to the partnership.

Limited Liability Partnership. Two or more principals that agree to share profits and losses in an ongoing business venture. The principals have heightened liability protection from debts and liabilities of the partnership.

Limited Liability Company. Two or more principals in an ongoing business venture with potentially favorable tax treatment and limited liability for its principals.

Corporation. One or more principals that invest money in exchange for ownership (stock). Principals generally have no personal liability for debts and liabilities of the business.

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Chapter 14: LIMITED LIABILITIES PARTNERSHIPS, LIMITED LIABILITY COMPANIES, AND OTHER BUSINESS ARRANGEMENTS

A limited liability company is an entity whose primary characteristics are that it offers its principals the same amount of liability protection afforded to principals of a corporate form of entity, and it offers pass-through tax treatment for its principals without the restrictions on ownership and scope required for other pass-through entities. LLC members are insulated from personal liability for any business debt or liability if the venture fails. LLCs are typically treated as a pass-through entity, the LLC’s members may also elect to be taxed as a corporation if they consider the corporate tax structure more favorable.

The use of LLPs is much more widespread now as some family businesses have also used the LLP form as a way to handle issues unique to the transition from one generation to another in a family business. While the general idea behind being an LLP is that all partners have liability protection for debts and liabilities of the partnership, some states impose conditions on these limits. In cases except where a partner has engaged in some misconduct or tortious conduct (such as negligence), the LLP acts only to shield the personal of assets of other partners—never the partner who committed the misconduct or negligence. Because it is not a taxable entity, an LLP files an information return that informs federal and state tax authorities of the profits and losses of the LLP. All income or losses are reported on the partners’ individual tax returns.

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Chapter 15: CORPORATIONS

A corporation is a fictitious legal entity that exists as an independent “person” separate from its principals. In general, shareholders, directors, and officers of a corporation are insulated from personal liability in case the corporation runs up large debts or suffers some liability. This liability protection is often referred to as the corporate veil. Corporations pay tax on their earnings and then the tax is paid again if corporate earnings are distributed to shareholders in the form of dividends (known as double taxation). The taxation occurs at both the (1) corporate level when income is earned by the corporation, and (2) individual level when it is distributed as a adividend (profit) to the shareholder.

In general, shareholders, directors, and officers of a corporation are insulated from personal liability in case the corporation runs up large debts or suffers some liability. This liability protection is often referred to as the corporate veil. in some cases courts will sometimes discard the corporate veil and allow parties to reach through the corporation to access the personal assets of one or more shareholders. This is known as piercing the corporate veil. A court will sometimes discard the corporate veil when it believes that fairness demands it. In these cases, which are relatively rare, courts may sometimes hold some or all of the shareholders personally liable.

Most states give shareholders certain rights to protect their ownership interests. Most importantly, shareholders, assuming a majority of ownership consent, have the power to elect and remove directors at the annual shareholders meetings. Shareholders also must approve any changes in the structure of the corporation through amending the articles of incorporation or bylaws.

The business judgment rule protects officers and directors from liability for decisions that may have been unwise, but did not breach the duty of care. This rule insulates directors from liability when, based on reasonable information at the time, the transaction or course of action turns out badly from the standpoint of the corporation.

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Chapter 22: CONSUMER PROTECTION LAW

The FTCA established an administrative agency called the Federal Trade Commission (FTC) and charged the FTC with the broad mandate of preventing unfair and deceptive acts or practices in commercial transactions.

A warranty is a seller’s (or lessor’s) promise to a consumer concerning the quality and/or functionality of a product. Warranties are recognized as legally enforceable promises under state statutory laws that are based on Article 2 of the Uniform Commercial Code.

When the seller makes a representation of fact about a product, this is known as an express warranty. In some cases a seller expressly represents that the goods have certain qualities or a certain level of efficiency. If the goods turn out not to have these qualities, the buyer may sue for a breach of the express warranty.

If the seller has not made a specific representation about the product, the buyer may still be protected by a UCC-imposed implied warranty. The implied warranty of merchantability 8 applies to every sale of a product from a merchant to a buyer (note that the buyer may or may not be a merchant) and requires the seller to warrant that the product is fit for its ordinary use. An implied warranty also arises when a seller promises that the product is fit for a particular purpose.

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Chapter 5: BUSINESS, SOCIETAL, AND ETHICAL CONTEXTS OF LAW

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Chapter 16: REGULATION OF SECURITIES, CORPORATE GOVERNANCE, AND FINANCIAL MARKETS

Two prevalent forms of equity instruments issued by corporations are common stock and preferred stock.

The most frequently used form of equity instrument is common stock (also called common shares ) in which the equity owner is entitled to payments based on the current profitability of the company.Perhaps the biggest advantage of preferred stock is that preferred stockholders have preference rights over common stockholders in receiving dividends from the corporation. In the event that the corporation fails or files for bankruptcy, preferred stockholders are ahead of common stockholders when trying to recover their losses from the liquidation proceeds.

Because bonds are debt instruments, investors expect fixed payments at regular intervals until the bond matures, at which time the principal amount of the bond, known as its face amount, is paid to the investor.

The primary scope of the Securities Act of 1933 3 (the ’33 Act) is the regulation of original issuance (and reissuance) of securities to investors by business venture issuers. The ’33 Act mandates: (1) a registration filing for any venture selling securities to the public, (2) certain disclosures concerning the issuer’s governance and financial condition, and (3) SEC oversight over the registration and issuance of securities. The system is designed to give potential investors a transparent view of the business entity’s financial information, potential liabilities, management practices, and other pertinent information that a business venture is required to disclose in its registration materials. The ’33 Act also provides defrauded investors with remedies against issuers that violate the statutory requirements.

the Securities Act of 1934 5 (the ’34 Act) regulates the sale of securities between investors after an investor purchased it from a business entity issuer. Therefore, the ’34 Act’s authority is over brokers, dealers, securities associations, brokerage firms, and other business entities that are engaged in the sale of securities between investors. The ’34 Act also regulates the relationship between existing stockholders and the corporation by requiring disclosure of information concerning (1) the financial performance of the company, (2) corporate governance procedures, and (3) any changes that increase or decrease risk that have occurred since the last report (such as the company being named as a defendant in a lawsuit).

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Chapter 22: CRIMINAL LAW AND PROCEDURE IN BUSINESS

Legality simply requires that crimes be specifically proscribed by law in advance of the conduct sought to be punished.

The principle of punishment is based on the concepts that criminal law (1) acts as a deterrent, (2) removes dangerous criminals from the population, and (3) that rehabilitation is an important part of the criminal justice system.

From a legal perspective a crime has two parts: a physical part whereby the defendant committed an act or omission, and a mental part focusing on the defendant’s subjective state of mind.

business owners and managers should have a fundamental knowledge of how criminal law may be applied to business entities. This knowledge helps business owners and managers to reduce risk and add value to the business by taking affirmative steps to limit criminal culpability for the business and its principals.

The federal Racketeer Influenced and Corrupt Organizations Act 8 (RICO) was enacted in
1970 with the objective of providing the government with a powerful tool to fight the rising tide of organized crime. The statute makes it a criminal offense for anyone associated with an enterprise to conduct or participate in its affairs through a pattern of racketeering activity.