Business, Law, and Government

Chapter 5: Business, Law, & Government

Legislation That Followed

Sarbanes-Oxley Act

* Official

* Public Company Accounting Reform and Investor Protection Act of 2002

* Requires

* Certification or financials by CEOs and CFOs

* Bans personal loans to executives

* Additional disclosure and independent audits

* Longer jail sentences and larger fines

Business Law:

* Sources

* Common law

* Based on past legal decisions or precedents

* Statutory law

* Based on legislation, constitution, or treaty

* Administrative law

* Based on regulations passed by administrative agencies

* FTC, FCC, FDA, EPA, etc.

Hierarchy of Courts in the US:

* State District Courts State Courts of Appeal State Supreme Court U.S. Supreme Court

* U.S. District Courts U.S. Courts of Appeal U.S. Supreme Court

Laws Affecting Businesses

* Laws of tort

* Non-criminal injury

* Intentional torts

* Negligence torts

* Product liability

* Negligence in design, manufacture, sale, and operation of products

* Hazardous situations ensures liability if harm is caused to others.

* Law of contracts

* Must have

* Offer

* Acceptance

* Consideration

* Uniform Commercial Code (UCC) provides gap fillers

* Takes over where contract language is vague

* Contracts

* Expressed

* In writing

* Implied

* Based on actions

* To be enforceable, must have

* Voluntary agreement, consideration, contractual capacity, …

* Law of sales

* Sales of a product sold for money or credit

* Sales contracts are binding

* Even if all elements of a contract are not met

* Warranties

* Express warranty

* Promises made by the seller

* Implied warranty

* The expectation that the product serves its purpose

*...