leb shaw

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Published on April 13, 2008

Author: Irvette

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LEGAL AND ETHICAL ENVIRONMENT OF BUSINESS:  LEGAL AND ETHICAL ENVIRONMENT OF BUSINESS LEB 320 F When Compliance Isn’t Enough:  When Compliance Isn’t Enough Does the Constitution come into play? EPA –is that in the Constitution? Social cost – what’s that? Are federal regulations mere guidelines? Was EPA supposed to stop all pollution? Cleaner water v. Steady jobs. Whoa? Compliance???:  Compliance??? Can WaterClear sue SunBright? Managers like Rick. Trapped in middle? Wasn’t Rick doing a pretty good job? Where does globalism come into picture? What if you were a member of WaterClear? Aaron Feuerstein, CEO Malden Mills:  Aaron Feuerstein, CEO Malden Mills A fire destroyed the plant, but CEO continued payroll until he rebuilt. His unionized plant went strike free. Now the firm is in bankruptcy, like Enron, WorldCom, Adelphia, and others. A firm should balance its profits and its good works. Ethics or Morality:  Ethics or Morality What’s the Difference??? Is one of them tougher than the other? Ethics:  Ethics Ethical Absolutes or Ethical Relativism Doing the Right Thing:  Doing the Right Thing The Right Thing??? The same in U.S. Saudi Arabia, China? Sources of Ethics:  Sources of Ethics Mom and Pop – Family School – Community Culture Religion And you keep right on learning Socrates:  Socrates The “Myth of the Cave.” Realism v. Appearance. The Sun illuminates everything but itself. The Light, Absolute, Logos. Monday, 24 February 2003:  Monday, 24 February 2003 Woman’s right to choose. Religion – life is sacred; fetus is human life. Platonic argument Secular – symbiotic/parasitic relationship. Plato:  Plato Socratic Dialogues. Women, as well as men, could hold high office. In “The Laws,” he described men as Gold – philosopher kings Silver – soldiers Bronze- artisans and laborers Iron – aggies and the like TriPartide Self:  TriPartide Self Plato – Chariot driven by “Reason” drawn by one “Noble” & one headstrong –”Spirit” Marx – Natural Self, Alienated Self, and, in time, a Species Self. Freud – Ego/rationality principle, SuperEgo (conscience and ego ideal), and Id (aggression, power, dominance). Sparta:  Sparta Spartan King Leonitus saved Athens from Persians at Thermoplilea Sparta defeated Athens in Pelopenesian War In defeat, Socrates and Plato introduced the “forms” and “philosopher kings” British philosopher Bertrand Russell during Battle of Britain described Plato as fashistic Aristotle:  Aristotle Happiness - a life of virtuous activity in accordance with reason. Virtue – neither excess nor deficiency. Where do you get that virtue? Stoics & Epicurians:  Stoics & Epicurians Detachment – apathia Social engagement v. separation from public affairs Logos Utilitarianism:  Utilitarianism Greatest Good – Greatest Number A quantitative measure Bentham—Pleasure/Pain Calculus Stuffed - University of London. Mills – Examined quality of pleasures. On Liberty – virtues resembling Aristotle. Go Figure:  Go Figure By keeping her promise to Margot, Alexis can create 500 units of utility. By breaking that promise, Alexis can create 5000 units of utility with Nicole. Alexis wants to know what to do? Neitzsche:  Neitzsche God is Dead! Do something with your freedom; create your own values free of superstition. Will to Power! Self-strength/fulfillment. “Whatever doesn’t kill me makes me stronger.” Eternal Return -Affirm Life! Live it with such love for life, that you’d do it again, and again, forever, throughout eternity. Pragmatism:  Pragmatism Truth – look at consequences. Use rules, principles, utility, virtue. If it doesn’t work well, change it. This does NOT mean anything goes. If theory does not account for facts, change the theory. Theory of Justice The Original Position:  Theory of Justice The Original Position In the Original Position, behind a Veil of Ignorance, Rawls imagines that rational, self-interested persons who know they will live in the society they create, but do not know their race, sex, abilities, religion, interests, life plan, social position, income or other particular attributes will choose fair and impartial rules, such as the following: Theory of Justice John Rawls:  Theory of Justice John Rawls Equality Principle: Each person has maximum basic liberty compatible with others – Contracts free of force, fraud, deception. Difference Principle: Social/economic inequalities should be arranged so All offices/positions are open to everyone under conditions of fair equality of opportunity, Greatest benefit goes to least advantaged. Business Ethics:  Business Ethics Checklist Facts 3. Issues Stakeholders – includes stockholders but also covers everyone who impacts or is impacted by the corporation. PERSPECTIVES:  PERSPECTIVES Legality. Headline News. Consequences (utility). The Right thing to do--moral rights. The Golden Rule--respect for others. Justice – Fairness. Procedural justice. Character/virtue. ENRON:  ENRON VISION & VALUES Respect Integrity Communication Excellence Enron:  Enron Respect – As opposed to entrapment of 401-K employees Integrity – As opposed to greed, deceitfulness, fraud Communication – As opposed to stonewalling by taking the 5th amendment Excellence – As opposed to fair-to-middling ENRON:  ENRON Largest U.S. bankruptcy until WorldCom. Complex off-shore partnerships kept liabilities off Enron’s books. Energy trading completely legal, but not self-dealing. Enron – Merrill Lynch:  Enron – Merrill Lynch “Sham” energy deal with M-L allowed Enron to meet Wall Street expectations and book $60 million profit (1999). Inflated profits drove up stock price, unleashed $$millions$$ in bonuses (Lay, Skilling . . .) and was later cancelled as planned. M-L denies receiving $8 from Enron for cancellation. Still under investigation. Arthur Andersen:  Arthur Andersen Let’s don’t talk about Arthur Andersen. It gave Professor Shaw an all expense paid trip to their Business Ethics seminar in Chicago. Over 3 years, it spent $5,000,000 WorldCom:  WorldCom Overstated earnings by $3.8 million Laid off 17,000 employees Stock dropped from $64.50 to 0.83 Former CEO received $366 million in low interest loans TYCO:  TYCO CEO Dennis Kozlowski charged with evading $1 million in taxes and is accused with destroying documents. Kozlowski and other executives bought art work, and one executive bought a home. In other words, they looted the firm (also Adelphia) for personal gain. Tax avoidance with offshore incorporation. ImClone Systems:  ImClone Systems CEO Samuel Waksal sold stock after learning the FDA denied certification of cancer treatment drug. Inside trading. Martha Stewart:  Martha Stewart Martha Stewart (a director of NYSE) allegedly sold stock on inside information provided by Merrill Lynch. Stock in Stewart’s Omnimedia declined 40%. (see Chpt. 16) M-L broker, Peter Bacanovic, allegedly warned her of illegality. Chainsaw Al:  Chainsaw Al Al Dunlap built his reputation on Wall Street as a CEO who could “turn around” failing corporations. He did it, allegedly, by an “employee census” and more efficient operations. The SEC now believes the “turnaround” at Sunbeam was engineered by financial fraud. An Arthur Andersen audit partner certified the results. Harken Energy:  Harken Energy In 1992, while George W. Bush was a member of Harken’s audit committee, the SEC forced Harken to correct an overstatement of profit. Bush sold 212,140 sh. @ $4 prior to a restatement of profit. U.T. Poly. Science Prof. Bruce Buchanan – “[S]imilarity to Enron style of accounting.” Executive Compensation:  Executive Compensation How Much Are They Worth? NYSE position is that all listed companies be required to expense stock options. If options reward employees, why aren’t they treated expensed as other forms of compensation? What’s the use of …:  What’s the use of … The Checklist Ethical Theories If you know the right thing, does that mean that you will do the right thing??? Chapter 2:  Chapter 2 Introduction to Law Power:  Power Plato – In The Laws, Plato would establish Philosopher-Kings, and place these Men of Gold as governors over Men of Silver (warriors) and Men of Bronz (citizens, workers). Women were treated equally, and private property abolished. Aristotle – In The Politics, Aristotle would have rule by Aristocrats, recognize private property, women – mothers, homemakers. Power:  Power Hobbes – life without civil government [The Leviathan] is solitary, poor, brutish, nasty, and short. Locke – Separation of power. State of nature - private property. Caretaker government – libertarian. Contemporary Sources of Law:  Contemporary Sources of Law Constitution Statutes Administrative Law Treaties Common Law INTRODUCTION:  INTRODUCTION Administrative Law, e.g., EPA regs Remember the Rick Wagner hypothetical in your syllabus. Treaties: 2/3 Senate + President (supreme law of the land). Classifications of Law:  Classifications of Law Criminal - Justice Department Civil fines – S.E.C. Substantive (rights) v. Procedural (rules). Public (legislation) v. Private (lawsuits) Element of a Crime:  Element of a Crime 1. Statutory violation – no common law crime. 2. Intent (mens rea or “guilty mind”). (a) Deliberate conduct. (b) Recklessness – conscious disregard of substantial risk of harm. 3. Proof beyond reasonable doubt. A New Criminal Defense?:  A New Criminal Defense? Jury nullification—a S. D. referendum. “Sure, I violated the law - it was too goofy.” Cruelty to animals? “What, I was defending myself against an attack dog.” Child pornography? “I just took a photo of my toddler in the bathtub?” CyberCrime:  CyberCrime Federal Law on CyberCrime. Criminal behavior if a person harasses someone by means of interstate telecommunications. Cyber Defamation:  Cyber Defamation Defamation in Cyberspace Civil Lawsuit, Not Criminal Chatroom Bulletin Board Cyber Stalking:  Cyber Stalking Several state laws (not Texas) have laws prohibiting cyber stalking. Laws require either “credible threat” or an intention to “harass, threaten, or alarm.” Cyber Theft:  Cyber Theft Access classified government info. Access info of financial institutions. Access govt. department file to affect use. Access files to defraud or obtain value. Sending viruses by hacking. Fraudulent access to government passwords Threat to cause damage to computer to extort something of value Children’s Internet Protection:  Children’s Internet Protection The Federal Children’s Internet Protection Act requires libraries that receive federal funds to install filtering software designed to block access to adult websites. Constitutional after the ALCU had successfully challenged the 1st two attempts to get this act on the books. . Actual Federal Crimes:  Actual Federal Crimes Fraudulent use of 4-H symbol or pretending to be a 4-H member. Unauthorized use of of “Smoky Bear” name. Illegal use of cremation urn. Interstate transportation of dentures. Issuing false weather reports. Mailing false divorce information Jurisprudence—Legal Wisdom:  Jurisprudence—Legal Wisdom Legal Positivism – look to Letter of the Law Natural Law – look to the Source Legal Realism – look to the Enforcer Legal Pragmatism – finding a workable legal solution roughly in accord with the Constitution, statutes, and cases Natural Law – Natural Religion :  Natural Law – Natural Religion David Hume (1711-76) Scottish skeptic, friend of Adam Smith. Laws of nature, discoverable through rational inquiry, are inconsistent with miracles of Bible. Natural law – a purely secular project developed as a means of protecting and promoting life in communities. Examples of Tort:  Examples of Tort Osborne v. Stages Music Hall, Inc. Did Music Hall owe a duty? Ozzie Osbourne’s “Suicide Solution” Could Ozzie foresee this outcome? Closing Arguments:  Closing Arguments Refresh your memory - Scan the slides chapter review. Examine problems at end of chapter. Ask a bunch of questions. Chapter Three:  Chapter Three Dispute Resolution Enviro-Vision v. Coastal Ins.:  Enviro-Vision v. Coastal Ins. Tony Caruso drowned. His partner, Beth Smiles, tried to collect double indemnity for accidental death. No luck! Then she turned to Janet Booker. . . . Alternative Dispute Resolution, State or Federal Court Alternative Dispute Resolution:  Alternative Dispute Resolution Negotiation Mediation Arbitration Mini-Trial – panel of “judges” Summary jury trial Arbitration:  Arbitration Private award (secret), quicker, cheaper compared to litigation. However, no class actions, no discovery procedure. No appeal unless arbitrator is corrupt. Enforcement of Arbitration:  Enforcement of Arbitration Meehan v. Nassau Community College Professor assigned to teach course; he had no proper credentials. 647 N.Y.S 2d 865 (1996) Awards won’t be enforced if they contravene strong public policy or corruption. An error of judgment is not sufficient. EEOC v. Waffle House:  EEOC v. Waffle House Employee lost job-related arbitration dispute with Waffle House. EEOC permitted to sue Waffle House for employee back pay under Americans With Disabilities Act. State and Federal Courts.:  State and Federal Courts. Which to choose: state or federal? Either choice, the court must have a. Personal Jurisdiction AND b. Subject matter Jurisdiction Venue:  Venue Venue designates the proper court within a state to file a lawsuit. Assuming the court has jurisdiction over the case, venue will be proper . . . In the county where the tort happened, In the home county of the defendant, If the suit involves real estate, in the county where the property is located. Federal Jurisdiction:  Federal Jurisdiction Federal Jurisdiction: Diversity & Federal Question. Exclusive federal jurisdiction -- bankruptcy, patent-copyright law, federal crime. Original and Exclusive. Original – Louisiana v. Texas. Diversity Jurisdiction:  Diversity Jurisdiction Federal Diversity jurisdiction requires: (a) Complete diversity of parties, AND (b) Amount in controversy $75,000 Non-residents:  Non-residents Out of State Motorists Out of State Corporations Pleadings:  Pleadings Plaintiff initiates suit by filing a petition in a court with jurisdiction. The petition alerts the defendant in plain language of the facts the lawsuit is based on. This is in compliance with our notion of due process. It’s based on fairness. Summons:  Summons A summons is served on the defendant with a copy of the petition by a court-authorized agent. The summons will notify the defendant of when and where to appear to answer the petition. Normally the defendant will have an attorney answer the petition and appear on defendant’s behalf. Failure to appear will result in the defendant’s losing the the lawsuit by default. Answer:  Answer Answer tells why defendant is not responsible. Don’t default by failing to answer! Answer:  Answer Answer may respond challenging the court’s jurisdiction. Answer may respond that “statute of limitations” has expired. Answer may respond that “driving while blonde” in not a civil wrong. Answer may say that plaintiff hasn’t alleged elements of tort or breach of contract. Judgment of Pleadings :  Judgment of Pleadings Court doesn’t have jurisdiction, Statute of limitations expired, State doesn’t give legal relief for plaintiff”s claim. Motion to Dismiss:  Motion to Dismiss U.S. District Court dismissed “fat suit” v. McDonald’s. Parents had “reason to know” that fast food produced weight gain. Ads “McChicken Everyday” and “Big N’ Tasty Everyday” were mere puffery. Class Action:  Class Action If there is commonality of fact and law among plaintiffs, the judge may certify a class. Class members will be notified and may opt-out. Caesar Barber, 5’10” 272#, represents a class v. McDonald’s, Ky.Fried, Wendy’s, and Yum on failure to warn on cholesterol, obesity, diabetes, heart disease, high blood. Pre-trial Discovery:  Pre-trial Discovery Interrogatories Depositions Documents Medical Exams Admissions. Klupt v. Krongard:  Klupt v. Krongard Klupt, according to trial court, “grossly abused” the discovery process. Krongard’s motion to dismiss counter-claim was granted and affirmed on appeal. Abuses: Klupt routinely objected to dates for depositions; changed lawyers causing delay; lied about conflicts; managed further 6 mo. delay; destroyed tapes. Summary Judgment:  Summary Judgment Undisputed facts. Outcome is a matter of law. Jones v. Clinton:  Jones v. Clinton Summary judgment for Clinton because Jones did not show “tangible job detriment or adverse employment action.” Other issues – trial was postponed. Settled out of court. Burden of Proof :  Burden of Proof Preponderance evidence: Civil actions the 51-49% rule applies. Beyond reasonable doubt: Criminal actions. Motion for Directed Verdict.:  Motion for Directed Verdict. At close of each party’s case, the other will move for a directed verdict asking the judge to take the case out of the jury’s hands and order it to return a verdict in his/her favor. Reason: The other has not introduced evidence to prove elements of his/her case. Jury Instructions:  Jury Instructions If jury cannot decide whether death was accidental or suicide, there is a legal presumption that death was accidental. Is this a proper instruction? Ponce v. Sandoval :  Ponce v. Sandoval Judgment NOV (against weight of evidence) and New Trial (error of law). Ponce v. Sandoval-Sandoval received $1600 jury verdict for medical expenses. Trial judge granted her NOV motion. Appellate court reversed NOV and reinstated jury verdict. Appellate court may affirm, modify, reverse and remand, or outright reverse. Closing Arguments :  Closing Arguments Review Chapter ending problems Chapter 4:  Chapter 4 Common, Statutory, & Administrative Law Common, Statutory, & Administrative Law :  Common, Statutory, & Administrative Law Stare Decisis – the doctrine of precedent. Res Ipsa Loquitur--1) defendant controls instrument of harm, 2) harm not normally occur in absence of negligence, 3) plaintiff in no way responsible for negligence or harm. Burden of proof shifts to defendant. Res Judicata. Common,Statutes,Administrative:  Common,Statutes,Administrative Common – Bystanders Statutory – Civil Rights Act Administrative – Chevron v. U.S. – “bubble” concept was a reasonable approach even though it may not have been superior to another strategy. “ Holly Farms v. NLRB Ginsburg –maybe not best, but a reasonable way O’Connor – strict construction, plain meaning Common Law Doctrines:  Common Law Doctrines Stare decisis – stand by the decision. Any case influenced, controlled by earlier case. Res ipsa loquitur – the thing speaks for itself. Suit v. surgeon who, 8 years earlier, failed to remove IUD while doing a hysterectomy. Going to the Rescue:  Going to the Rescue Duty to go-to-the-rescue. Ethical duty. a) Ability--harm to rescuer? b) Need—how serious? c) Proximity—close by or not? d) Last Resort—no one else helping. Going to the Rescue:  Going to the Rescue General Rule—NO legal duty to rescue unless defendant has caused danger. Factors considered in exceptional cases. Could harm have been prevented? Was aid negligently administered? Was harm foreseeable? Was failure to act morally wrong? Was there a special relationship to victim? Restaurants and Bars:  Restaurants and Bars Restaurant served drinks to diner until he was visibly intoxicated. Drove away and killed motorcyclist. El Chico v. Poole (Texas 1987). Texas per se statute. Per Se—What’s that??? What if diner in your restaurant is choking? Per Se Negligence:  Per Se Negligence DEFENDANT WITHIN CLASS OF PERSONS INTENDED, TYPE OF HARM STATUTE INTENDED TO PREVENT, BREACH OF STATUTE CAUSES INJURY. Rescue:  Rescue Union Pac--duty to rescue trespasser. Cappier – laborer suffered “heat stroke.” Osterlind v. Hill – canoe renter drowned. Soldano v. O’Daniels – Happy Jack’s. Psychiatrist:  Psychiatrist Tarasoff v. California—special relation with Poddar who confided intent to kill; the victim was foreseeable. Is psychiatrist responsible? Psychiatrist is an agent of the University of California. Special relationship. Almonte v. Ingram:  Almonte v. Ingram DeMasi, a psychiatrist, confided to Ingram, a child psychiatrist, that he was a pedophile. Ingram told no one; 4 months later DeMasi molested Denny Almonte. DeMasi served 5 yrs in prison. When released he violated parole and returned to prison. When released in 1995 he disappeared. Almonte experienced emotional legal & problems and was confined to institutions himself. Almonte v. Ingram:  Almonte v. Ingram Patients in therapy say all sorts of troubling things. In fact, it’s the therapist’s job to encourage patients to reveal deep-seated feelings. No reason to think patient would act on all of them. Therapist shouldn’t breach confidentiality each time patient says something bizarre – that would cause patients to avoid therapist in the first place. Rescue in Texas:  Rescue in Texas Dr. Thapar began treating Lilly in 1995; he knew about Lilly’s paranoia and delusional attitude toward Zezulka, his stepfather. Lilly was treated with psychotherapy and drugs; on 6 occasions he was hospitalized. Thapar testified that Lilly felt like killing Zezulka. Within a month after release, Lilly killed Zezulka. Thapar is sued by Zezulka’s wife. Thapar v. Zezulka (Texas 1999) Rescue in Vermont:  Rescue in Vermont A person who knows that another is exposed to grave physical harm and can render aid without peril to himself or diminished duty to dependants must give reasonable aid if not provided by others. Reasonable assistance relieves one of civil damages unless gross negligence (slight care), or expects remuneration. Does not affect physicians in ordinary practice. Fine - $100. 23 Vermont Code sec. 519 Adulterous Affair:  Adulterous Affair Employees of Helena Labs began having an affair. Their spouses later discovered the liaison, and sued Helena Labs for carelessly failing to prevent it. Outcome? Helena Laboratories v. Snyder, Texas 1995. The Legislative Process:  The Legislative Process Bills--Move from Legislature to Conference, From there back to Legislature, Finally to Executive for signature or veto. Two thirds vote of both houses passes bill over president’s veto. Griggs v. Duke Power:  Griggs v. Duke Power Civil Rights Act of 1964 prohibits intentional racial discrimination in hiring. What if hiring policy is “fair in form,” but discriminates in practice? After 1964 Act a new Duke rule: Executive jobs only to those with h.s. diploma/IQ test. What if that discriminates on race?? Wards Cove v. Atonio:  Wards Cove v. Atonio Whites hired for skilled jobs; nonwhites-unskilled jobs. This violated law unless employer could show a good reason (“business necessity.”) S.C. concluded that “business necessity” in hiring was NOT required despite Griggs v. Duke Power. Congress later restored requirement of business necessity. President G.H.W. Bush vetoed. Failed by one vote to pass over veto. 1991 Act just vague enough to pass Congress. Statutory Interpretation:  Statutory Interpretation Statutory interpretation: (a) plain meaning, (b) legislative intent, (c) public policy. Griggs v. Duke Power:  Griggs v. Duke Power Title VII, based on commerce clause, prohibits job practices that are “fair in form, discriminatory in practice.” Ability tests developed by professionals are legal. Administrative Law:  Administrative Law Agencies may be executive or independent. Agencies gain power through a delegation from the legislature. Independent - SEC, FCC, FTC, NLRB. Executive –IRS, FBI, NRC, EPA. Separation of powers. Formal and Informal Rules. Subpoena duce tecum :  Subpoena duce tecum FDIC v. Garner “Subpoena duce tecum.” Subpoena duce tecum must not be unreasonably burdensome or seek privileged information; it must seek only relevant documents. Judicial Review:  Judicial Review Holly Farms v. NLRB The S.C. found that the Board’s interpretation, while not the only one possible, was reasonable, therefore the Board was affirmed. Majority – Ruth Bader Ginsberg Minority – Sandra Day O’Connor Chapter Five:  Chapter Five Constitutional Law Constitutional Law :  Constitutional Law Separation of Powers - checks and balances. Art. I - Grant of powers to Congress. Especially important is the Commerce and the Necessary and Proper clauses. Commerce Power:  Commerce Power Wickard v. Filburn, 317 US. 111 (1942)—The Depression Era. U.S. v. Lopez, 514 U.S. 115 (1995)—The Rehnquist Court. Dormant Clause 10th Amendment:  Dormant Clause 10th Amendment Maine tried to use10th amendment tax power to deprive Camps of property tax exemption. Camps attendees were 95% out-of-state. Can Camps be penalized in comparison to in-state? What is the dormant aspect of the commerce clause? Camps Newfoundland/Owatana v. Maine Taxing and Spending:  Taxing and Spending In addition to the Commerce Power, Art. 1, Section 8 of the Constitution gives Congress the power to “lay and collects Taxes . . . to pay the Debts and provide for the Common Defence and general Welfare of the United States.” Teenage drinking was a “general welfare” problem – highway funds withheld. Judicial Supremacy:  Judicial Supremacy The Case of the Midnight Judges Marbury v. Madison—Chief Justice John Marshall saw a judicial veto in the Constitution. Where did he get that idea? Judicial Supremacy:  Judicial Supremacy Article III -- One Supreme Court and other courts as Congress may establish. Article VI – Supreme Law of the Land: The Constitution. Laws in Pursuance of Constitution. Treaties under Authority of U.S. Treaties are made by President and 2/3 of Senate. Executive Powers :  Executive Powers Art. II--President is commander in chief and chief executive officer. Youngstown Sheet and Tube v. Sawyer—Did President Truman exceed his powers as Chief Executive? What about President Nixon fixing prices? The First Amendment:  The First Amendment Congress shall make NO law respecting . . . Establishment of religion or abridging free exercise thereof, or abridging these constitutional rights: Speech, Press, Peaceable Assembly, or Petition government to redress grievance. Fourteenth Amendment:  Fourteenth Amendment Establishes citizenship if born or naturalized in U.S. States cannot deny life, liberty, or property to ANY PERSON without due process of law. States cannot deny “any person within its jurisdiction” equal protection of law. Pledge of Allegiance:  Pledge of Allegiance “. . . Under God . . .” Do these two words in the Pledge of Allegiance violate the Establishment Clause of the First Amendment? Two religious clauses: Establishment and Free Exercise. Why is this applied to states . . . ? Ethnicity:  Ethnicity Due process clause of 14th A. applies the Bill of Rights to the states. Massachusetts passed statute forbidding discrimination on basis of ethnicity. Porcaros awarded $1.5 million - permit for developing real estate denied on grounds that were not held against other groups. “All you Italians are a bunch of thieves.” Symbolic Speech:  Symbolic Speech Amendment I--Texas v. Johnson US flag was burned at Republican Convention (1980) in Dallas. What kind of message was that? Symbolic Speech:  Symbolic Speech U.S. v. Eichman – U.S statute - flag burning Barnes v. Glen Theater – non-obscene nude dancing R.A.V. v. St. Paul – hate-crime ordinance penalized burning crosses – the Klan Wisconsin v. Mitchell – child beaten on account of race - symbolic speech? Political Speech:  Political Speech Political speech receives highest protection. However, it may be criminalized if “intended and likely to create imminent lawless action.” Justice Holmes:  Justice Holmes “The question in every case is whether the words used are used in such circumstances and are of such a nature as to create a clear and present danger that they will bring about the substantive evils that Congress has a right to prevent. It is a matter of proximity and degree.” Schenck v. U.S., 249U.S 47, 52 (1919). Justice Holmes:  Justice Holmes “The most stringent protection of free speech would not protect a man in falsely shouting fire in a theatre and causing a panic.” The [Act] punishes conspiracies as well as actual obstruction. No grounds for saying that success alone makes an action a crime. Schenck v. U.S. Justice Holmes:  Justice Holmes [The] ultimate good desired is better reached by free trade in ideas – that the best test of truth is the power of that thought to get itself accepted in the competition of the market . . . . That at any rate is the theory of our constitution.” Abrams v. U.S., 250 U.S 616, 627-28 (1919) Dissenting Opinion Republican Party v. White:  Republican Party v. White Supreme Court struck down Minnesota law that prohibited judicial candidates from announcing position on legal and political issues. Strict scrutiny is applied to rules limiting speech. must be narrowly tailored must be a substantial advancment must be a compelling state interest. 122 S.Ct. 2528 (2002) 5 – 4 Split Cleveland Voucher Program :  Cleveland Voucher Program By a 5 – 4 decision, the Supreme Court concluded that school vouchers put money into the hands of parents who could use it for parochial or other private schools. Zelman v. Simmons-Harris 122 S.Ct. 2460 (2002) Freedom of Religion:  Freedom of Religion Engle v. Vitale – School Prayer. Can it acknowledge an “Almighty Being.” Pledge of Allegiance – 10th Circuit. “One Nation Under God.” Watchtower v. Stratton:  Watchtower v. Stratton Village ordinance required registration and permit to engage in door-to-door advocacy. Ordinance covered religious proselytizing, anonymous political speech, and distribution of handbills. Violation of First Amendment?? Watchtower v. Stratton, 122 S.Ct. 2080 (2002). 8 – 1 split Time, Place, Manner Limitations:  Time, Place, Manner Limitations Park ordinance required a permit before holding large-scale events in public parks. Ordinance was content neutral regulation with adequate safeguards to guide enforcement and judicial review. Not a big surprise. Clark v. Chicago Park District, 122 S.Ct. 775 (2002). Yard Signs:  Yard Signs A city ordinance prohibited yard signs of any kind. It was designed to foster an aesthetically pleasing visual environment. Could you be prosecuted if your sign supported or opposed the war on terrorism. Nude Dancing:  Nude Dancing Was law prohibiting nudity a valid exercise of 10th amendment power to control health, safety, morals. Was law an unconstitutional suppression of expressive conduct. Barnes v. Glen Theater, 501 U.S. 560 (1991) Obscenity:  Obscenity Would AVERAGE person applying CONTEMPORARY community standards find the work as a whole appeal to PRURIENT interest. Depicts in PATENTLY OFFENSIVE way sexual conduct defined by state law. Does work as a whole lacks serious literary, artistic, political, or scientific. Obscenity:  Obscenity Prurient – excites lustful or lascivious thoghts. Court must distinguish between normal and shameful interest. Look to local community standards, not state or national. Brockett v Spokane, 472 U.S. 491 (1985). Patently offensive – ultimate sex act normal or perverted, actual or simulated. Miller v. Cal., 413 U.S. 15 (1973) Social merit – national standard/average person. Jury determines standard. Pope v. Illinois, 481 U.S. 497 (1987). Justice Potter Stewart:  Justice Potter Stewart Justice Stewart concluded that he couldn’t define obscenity, but “I know it when I see it.” Commercial Speech:  Commercial Speech Commercial speech may be prohibited if false or misleading. Regulations must be reasonable and must directly advance a legitimate goal. Fane v. Florida Institute of CPA. (see problem #2, p. 123) LiquorMart:  LiquorMart LiquorMart v. Rhode Island--statute prohibited truthful, non-misleading price advertising. R.I. did not show that regulation would materially advance state interest without impairing an important component of free speech. Further, it ignored easy alternatives. LiquorMart v. Rhode Island, 517 US 484. Execution of mentally retarded.. :  Execution of mentally retarded.. Eighth Amendment Cruel and unusual??? Atkins v. Virginia. 122 S.Ct. 2242 (2002) Penry v. Lynaugh, 492 U.S. 302 (1989) National consensus” of 29 states plus U.S. UNCONSTITUTIONAL! Execution of Juveniles:  Execution of Juveniles S.C. Justices Stevens, Ginsberg, and Beyer dissented from majority which denied a stay of execution for Texas inmate, Toronto Patterson, who was 17 when he murdered his 3 year old cousin. An issue for the court to examine within the next few terms. WHAT DO YOU THINK? CONSTITUTIONAL! Reproductive Rights:  Reproductive Rights Amendment IX--Enumeration of rights in Constitution not deny those reserved to people. Roe v. Wade – right of privacy. Fathers, husbands, boyfriends have no right to veto a woman’s right to have an abortion. Reserved Powers of State:  Reserved Powers of State Amendment X Powers not delegated to the U.S. are reserved to the states and to people. Amendment X covers the state’s power to incorporate or establish cities, counties, state agencies, plus schools, roads, and all other state laws and instrumentalities. Drug Testing:  Drug Testing Supreme Court approved school district policy requiring random drug testing (urinalysis) of high school students in band, glee club, etc. Interest of educators in keeping drugs out of school outweighs privacy interests. Board - Education v. Earls, 122 S.Ct. 2559 (2002). Peyote:  Peyote In 1991 the S.C. held that use of peyote in a Native American church was not protected from enforcement of Oregon criminal law. Congress passed the Religious Freedom Restoration Act forbidding government from enforcing law that substantially burdened religion without compelling need and in least restrictive manner. Peyote:  Peyote In City of Boerne v. Flores (1997) the S.C. affirmed its earlier holding. Religious Freedom Restoration Act – unconstitutional. The 14th Amendment, section 5, only gives Congress the power to enforce Freedom of Religion, not to define terms. S.C. had already said Oregon criminal law did not violate the Constitution. Due Process:  Due Process Procedural due process. How much process is due? Depends on importance of liberty or property affected. Judge must be neutral. Hearings:  Hearings Attachment – hearing before attachment Garnishment – hearing before attachments In Texas - garnishment for child support and student loans only Secret Settlements:  Secret Settlements Secret settlements between the parties to a lawsuit may in fact “do justice.” They also clear court dockets quickly, and that’s a plus. But secrecy also keeps the settlement from the public. Think what might be different today if the misdeeds of Catholic priests had been revealed a long, long time ago. Secrecy in the asbestos and textile industries, most likely, cost many lives. Taking of Private Property:  Taking of Private Property Private property taken for public use requires government to pay just compensation. Amendment 5. Government may regulate private property without payment for restriction of its use, e.g., zoning. Taking:  Taking In 1986, Lucas paid $1 million for two lots on the Isle of Palms in S.C. Two years later the state passed the Beachfront Management Act. It prohibited building homes on the property. The barrier islands protect shoreline from erosion. Is this a taking, or a regulatory measure? Lucas v. S.C. Coastal Council, 505 U.S. 1003 (1992). Procedural Due Process:  Procedural Due Process Doehr was about to be sued for assault and battery. DiGiovanni got a $75,000 prejudgment attachment on Doehr’s home. Doehr challenged the prejudgment attachment as unconstitutional. Outcome? Connecticutt v. Doehr, 501 U.S. 1 (1991) Substantive Due Process:  Substantive Due Process Examines basic rights being affected The more important the right, the higher scrutiny that is required Economic regulation demands a reasonable relation between means and ends Fundamental rights – regulation presumed invalid unless state has compelling reason Means and Ends:  Means and Ends Economic regulation – some income brackets are taxed at a higher rate than others Social regulation – speed limit and other traffic laws Strict Scrutiny:  Strict Scrutiny The statute (or “the means”) must be necessary to promote a compelling interest. Compelling Interests - Fundamental Rights Examples: speech, voting, travel, racial discrimination, privacy Equal Protection of Law:  Equal Protection of Law Minimal scrutiny – economic and social regulations Intermediate scrutiny – gender classifications and legitimacy Strict scrutiny – race, privacy, and fundamental rights Minimal Scrutiny:  Minimal Scrutiny Practically always the courts can find some reasonable connection between “means” and “ends.” NYC Transit Authority v. Beazer – methadone users excluded from jobs that were not safety sensitive. Intermediate:  Intermediate The statute (“the means) must have a substantial relationship to an important government objective (“the end”). Gender based discrimination. Legitimacy. Strict Scrutiny:  Strict Scrutiny Government restriction must be necessary to compelling interest. Abortion - women under a certain age; parents must be given notice. Adults – no notice to natural father or husband. Helmet Law:  Helmet Law Motorcyclist challenged law as violation of Equal Protection (14th). Law upheld. It was presumptive valid; this means rationally related to legitimate end. Not unconstitutionally vague, created no suspects classification, and violated no fundamental rights. Robotham v. State, 488 NW2d 533 City of Dallas v. Stanglin:  City of Dallas v. Stanglin Dallas ordinance prohibited ages 14-18 from “Class E” dance halls to avoid drugs and such. They were permitted in roller rinks and other places teenagers congregate. Texas S.C-distinction unconstitutional- teens mix at roller rinks too. Should U.S. Supreme Court affirm or reverse? Examples:  Examples Plessy v. Ferguson Brown v. Board of Education Bolling v. Sharp Sweatt v. Painter Hopwood v. University of Texas CID’s and Due Process:  CID’s and Due Process Common Interest Developments CID’s: Open for private regulation? or Is this State Action? Tort Law:  Tort Law Torts are civil wrongs, other than breach of contract, that law grants compensation to injured party. Intentional Torts – Chapter 6 Negligent Torts – Chapter 7 Intentional Torts:  Intentional Torts Intentionally negative Theater reviews, Movie reviews, Book reviews. What about . . . Restaurant reviews such as “ . . . yellow death on duck.” Statute of Limitations Reminder!!!:  Statute of Limitations Reminder!!! Attached to every legal cause of action, there is a period of time in which a lawsuit – tort or contract – must be filed in a court of proper jurisdiction. Plaintiff’s action in tort and in contract based on defendant’s negligent misrepresentation of contract terms. For plaintiff couldn’t discover her claim existed until after statute of limitations expired. Example – Intentional Tort:  Example – Intentional Tort Jury verdict for $5 million v. California cemetery for fraud. Two hundred fifty bodies buried in roadway of cemetery. Unusual but jury divided amount per plaintiffs. It took two days to read the verdict. Barnes v. Angles Abbey, (Sup. Ct. L.A. ). Elements of Tort:  Elements of Tort Fault – breach of duty Causation “chain of dominos” causation (actual cause) AND B) foreseeability Damage – physical or emotional Defamation:  Defamation DEFAMATION--intentional false statement of fact, not opinion, harmful to reputation and communicated to a third person. Third person may be secretary receiving dictation or someone who overhears defamatory statement. Publication:  Publication Sixty-eight year old Christine Melton was stopped by security guard and accused loudly in parking lot. Shoppers stopped and heard: nothing was found in purse. No witnesses produced by Melton. For Melton based on reasonable inference that other heard accusation of crime. Forced Self Publication:  Forced Self Publication Lewis was asked by employer to falsify records. When she refused she was fired for “gross insubordination.” She had to say that in answer to prospective employer’s question, and her explanation was not believed. She didn’t get the new job. When she sued original employer, the defense was that she publicized the info herself. Defamation per se:  Defamation per se Accusation of serious crime Incompetence in profession Having a sexually transmitted disease Being and unchaste woman Per se – What’s that???? Damages:  Damages Slander – oral defamation. Plaintiff must show actual money damages Libel and defamation per se. Showing of non-monetary damages such as mental anguish or humiliation is sufficient Opinion:  Opinion Yeagle v. Collegiate Times--opinion or defamation (libel) per se??? Actual Malice:  Actual Malice Public figures must show actual malice. What is “actual malice?” Actual Malice:  Actual Malice Actual malice--knowledge of falsity or reckless disregard for truth. Communication majors – proceed with caution. Butt Head Astronomer:  Butt Head Astronomer A big project at Apple was code-named “Sagan.” Famous astronomer Carl Sagan filed suit to force Apple to stop using his name. Apple renamed the project “BHA.” Sagan filed second suit for defamation. Sagan v. Apple Computer (Mass. 1994). Libel in Cyberspace:  Libel in Cyberspace Varian Medical Systems and two executives won libel suit against former employees for posting 14,000 defamatory messages, some vulgar, on 100 internet messages boards. Defendants alleged extramarital affairs, danger to children, videotaping office bathrooms, chronic lying , and hallucinating. http://www.law.com Oprah:  Oprah Texas cattle ranchers sued on basis of “False Disparagement of Perishable Food Products Act.” Statements must have basis in “reasonable and reliable scientific inquire, facts or data.” Statute covers agri- and aqua-culture only. Dismissed: No cause of action in Texas. Source: Texas A&M. Privilege:  Privilege Absolute privilege Witness in court Legislative debate Qualified privilege Legitimate need to know QUALIFIED PRIVILEGE:  QUALIFIED PRIVILEGE Texas Qualified Privilege Texas employer who discloses information about a current or former employee is immune from liability unless proven by clear and convincing evidence that employer spoke with actual malice. “Clear and convincing evidence.” Huh??? False Imprisonment:  False Imprisonment False Imprisonment--intentional restraint without reasonable cause or consent. Sixty-eight year old Christine Melton stopped by security guard and accused of shoplifting. This is not in itself false imprisonment. That depends on the basis for accusation; nothing was found in purse. Ruditys v J.C.Penny:  Ruditys v J.C.Penny Woman waiting in car for two shopping companions when asked by security guard to return to store for questioning. All charged with theft and acquitted. Awarded $250,000 for false imprisonment and malicious prosecution. Ruditys v. J.C.Penny, Co. No. 02-4114 Delaware (2003. Cook v. Chrysler:  Cook v. Chrysler Cook was induced to test spaciousness of trunk in new car she was shopping for. Salesman slammed down the trunk and gathered others to witness. When Cook emerged, salesmen were “high- fiving.” For being 1st, salesman won $100. Emotional Distress:  Emotional Distress Conduct - extreme & outrageous?? Was this appropriate for summary judgment? Roe v. Lynn Mills Assault:  Assault Assault--an act that places victim in fear of immediate battery. Western Union Telegraph V. Hill (Ala. 1933). Danny Devito??? Battery:  Battery Unwanted or offensive Intentional touching Cattle Prod Caudel v. Betts, 512 So.2d 389 (1984) Intentional Torts:  Intentional Torts Trespass – intentionally entering another’s land without permission, or refusing to leave after permission expires. Trespass to property – hiding roommate’s book before final. Conversion--civil action that is equivalent of theft. Fraud:  Fraud Intentional misrepresentation of material fact on which someone relies and suffers damage. Accountants liability for fraud. Those who hired the accountant Limited to known and intended beneficiaries Reasonably foreseeable Damages:  Damages Nominal Small amount to vindicate right Compensatory Amount of money to compensate victim Punitive Some multiple of compensatory Punitive Damages:  Punitive Damages Punitive damages--damages over and above compensation designed to punish defendant for conduct that is extreme and outrageous. Grubbs Nissan v. Bien, 881 SW2d 843 (1994) Fraud and Punitive Damages:  Fraud and Punitive Damages Walston v. Monumental Life Ins. Deceptive insurance practices and wrongful denial of benefits. Punitive damages approved. Walston v. Insurance Co., 129 Idaho 211 (1996) Business Torts:  Business Torts Tortious interference with contract: Texaco v. Pennzoil. Tortious interference with prospective advantage: The Barber Shop case. Privacy:  Privacy a) Intrusion, b) Private Facts, c) False light, d) Commercial Exploitation. Lanham Act:  Lanham Act Lanham Act--a) False, misleading, b) Commercial context, c) Likelihood-harm Coors v. Anheuser Busch. Natural Lite, a beer brewed by A-B on the East Coast, was being outsold by Coors. It televised a parody of “Pure Rocky Mountain Spring Water.” Coors wasn’t amused. Defamation Review:  Defamation Review Elements--falsity, harm, communication to a third person. Defamation per se: (1) Accusation of serious crime, (2) Sexually transmitted disease, (3) Incompetence in profession, (4) Unchastity in women. Actual Malice--knowledge of falsity or reckless disregard for truth. Privilege: (a) Absolute--sworn testimony in court, (b) Qualified--good faith communication of information to recipient who needs to know. Intentional Torts:  Intentional Torts False Imprisonment--reasonable basis for suspicion and reasonable detention. Intentional infliction of emotional distress—Grubbs Nissan v. Bien. Damages--nominal, compensatory, punitive. Tortious interference with contract Texaco v. Pennzoil. Intentional Torts:  Intentional Torts Privacy and Publicity: Intrusion. Disclosure of embarrassing facts. False Light. Commercial Exploitation. Lanham Act--false or misleading commercial speech which is likely to harm. Defenses:  Defenses Plaintiff fails to prove elements of tort. Written waiver of liability. Privilege: Absolute – Conditional. Self defense. Statute of Limitations Segue:  Segue A Southwest Texas student secretly video taped intercourse with a U.T. coed. Then he circulated the tape to friends, and the tape made its way to both campuses. She was outraged by this betrayal; her suit was based on negligent infliction of emotional harm. Negligence? Boyles v. Kerr, 855 SW2d 593 (1993). Negligent Torts:  Negligent Torts Chapter 7 Negligent Torts:  Negligent Torts TORTS--Fault + Causation + Injury. Fault --Duty of care + breach Causation -factual chain of causation and foreseeability or proximate cause Injury. Jenny Jones:  Jenny Jones Scott Amedure was killed after revealing a “same sex” crush on Jonathan Schmitz. Schmitz was convicted of murder. Amedure’s parents claimed tha Jenny Jones “ambushed” Schmitz by not telling him subject matter of program. Jury - $25 million for plaintiffs. Trip and Fall:  Trip and Fall Verdict for plaintiff $21 million. She tripped over remnant of “no-parking” sign which was 3-4 inches high and 2 from curb. NYC put on notice by complaints. Damages: Skull fracture epidural hematoma Frontoparietal craniotomy Cognitive dysfunction, depression, headaches Memory loss, cognitive deficits Fired from job Paek v. NYC, Sup. Ct. 2002. Palsgraf v. Long Island:  Palsgraf v. Long Island Foreseeability Proximate Cause Both mean the same thing. Joy Riders:  Joy Riders Garage (Breisig) left keys in ignition. Before owner came, teenagers took it. Left it parked on street overnight. Next day a friend drove and injured the plaintiff, George. Defendant negligent? Proximate cause? Brown v. P.C.O.M.:  Brown v. P.C.O.M. Yvette gave birth to daughter who tested positive for syphilis. Husband was confronted, and admitted an affair. Later, husband and baby retested negative. Stress - husband physically abusive. Wife chased him outside with her police revolver; shot, missed, both arrested. 760 A.2d 863 (2000) Fault = Breach of Duty:  Fault = Breach of Duty Negligence = falling below standard of care expected of average reasonable person under the circumstances. Louisiana Civil Code, Art. 2315 Negligent Retention:  Negligent Retention $2.5 million for N.Y. woman sexually assaulted. Apple Tours employed supervisor with record of assaulting another woman years earlier. $1 million for psychological injury and $1.5 in punitive damages. Horse Hockey:  Horse Hockey A young woman and her employees were guests of the circus owner. A “dancing horse” evacuated in her lap. Everyone laughed. She was mortified, and sued the the circus owner. Was this the “negligent infliction of emotional harm?” AIDS:  AIDS Jennifer Lawson, 12, contracted HIV in a blood transfusion in 1985. Her doctor, affiliated with UCLA, knew this and informed the donor, but not Jennifer though he treated her for next 5 years. Three years later she had sex with Reisner, and in 1990 Jennifer died of AIDS. Reisner tested HIV+ and sued UCLA. Outcome?? Waiver :  Waiver S.C. Connecticut held that waiver signed by “snowtube” renter not preclude liability for damages. Ms. Hyson released White Water Mountain from “inherent” risks, but not negligence. Colorado law controls this issue. Waiver:  Waiver Plaintiff rented Honda ATV and signed agreement with clause that waived liability of defendant for harm caused directly or in- directly by use of ATV. Release valid if Not contravene public policy Relates to private conduct Freely bargained, no adhesion Dumont v. Shaw’s Supermarkets:  Dumont v. Shaw’s Supermarkets Dumont “slipped and fell” on chocolate cream that fell from Shaw’s candy bin. Foreseeable? While Shaw’s didn’t know of hazard, Shaw was aware of similar hazards in the store and failed to address this one. 664 A 2d 846 (1995) Mulcahy’s Roadside Pub:  Mulcahy’s Roadside Pub Slip and Fall Plaintiff recovers $450,000 Plaintiff suffered nerve and tendon lacerations Witness for plaintiff testified that earlier that evening he had seen glass on floor in area of plaintiff’s fall Case of the Missing Finger:  Case of the Missing Finger Wells was sent into “tank” by Durkee without proper gear. He was overcome by gas, and became incoherent and delirious. At hospital he bit off nurse’s finger. Foreseeable or Way too bizarre? Widlowski v. Durkee Foods, (Illnois 1990) Danger Invites Rescue:  Danger Invites Rescue Sewage worker died in tunnel when gas mask failed. Co-workers entered tunnel in attempted rescue without masks and died. Foreseeable??? Should manufacturer be held responsible to co-workers??? Guarino v. Mine Safety Appliance Co. Hernandez v. Univ. of Arizona:  Hernandez v. Univ. of Arizona The duty to act reasonably under circumstances is socially imposed-common law. Social host liability. Affirmative duty to act--basically no legal duty to rescue unless defendant has caused harm. Social Host - Texas:  Social Host - Texas Smith v. Merritt (1997)—Smith was injured while riding with 19 year old who consumed liquor at Merritt’s party. Did Merritt have duty to Smith not to serve liquor to 19 year old driver? Would the result be the same if the defendant was a bar or restaurant? Landowner’s duty:  Landowner’s duty Trespasser--landowner’s only duty is not to intentionally injure. Licensee--guest on land with consent; social host must warn of hidden dangers that are known about. Invitee--person on property because open to public. For example, a business customer-- owner has duty of reasonable care to invitee. Ann M. v. Strip Mall:  Ann M. v. Strip Mall Was the owner of strip mall responsible for sexual assault on employee. Many requests to increase security. High crime area? Components:  Components Negligence Per Se minimum standard of care to protect certain groups; violation of statute that injures group member is per se negligence. Factual cause--chain of dominoes. Foreseeability--can general type of harm be reasonably anticipated? Superseding cause--entirely unforeseeable; “highly unusual, extraordinary, bizarre.” Coca Cola:  Coca Cola Waitress’s hand badly damaged as she was loading Cokes into cooler. Presumption of defective bottle or excessive pressure prevailed. Coke employee testified that he had seen/heard explosions in warehouse, 150 P2d 436 (1944). What about a roach in a coke bottle??? Repo Man :  Repo Man Should summary judgment for Repo Man be reversed and remanded for trial? Slide220:  SECURITY INTEREST: COVERAGE The vehicle and all parts or goods installed in it; All money or goods received (proceeds) for the vehicle; All insurance . . . or other contracts we finance for you; and All proceeds from all insurance . . . or other contracts we finance for you. WE MAY TAKE VEHICLE FROM YOU: If you default, we may take (repossess) the vehicle from you if we do so peacefully and the law allows it. Affirm or Reverse??:  Affirm or Reverse?? Plaintiff’s argument. Valley owed duty to everyone. Foreseeable because repo involves hostility. Darkness and car alarm evidences negl. Harrision Ford fantasy. Defendant’s argument. Irresponsible owner at fault; not repo man. Nighttime repo was as safe as possible. Alternative: Knock on door? Negl use of gun caused injury;not repo. The Condom Case:  The Condom Case Reynolds v. Highland Manor. Injury must be genuine, not speculative. Guest fears HIV:  Guest fears HIV Employee, fearing HIV, sues employer for emotional harm. Co-employee who “looked and acted gay” cut his hand and blood splattered on Ms. Guest. She began to suffer from panic attacks, depression, insomnia – diagnosed with Post-Traumatic Stress Disorder. Five HIV tests were negative. 38% permanent partial disability. Bystanders:  Bystanders Negligent infliction of emotional harm to bystander. Example: mom sees injury to child. Elements Plaintiff near scene Distress from contemporaneous sight of accident Plaintiff is close relative of victim Child Molestation:  Child Molestation Friends of owners/operators of an Austin daycare center knew of child abuse and failed to report it. Does the Texas Family Code which criminalizes the conduct of the perpetrators also impose per se tort liability on bystanders? Contributory v. Comparative:  Contributory v. Comparative Contributory Negligence—a small degree of negligence can prohibit plaintiff from collecting any damages. Comparative Negligence—a jury will assess percentage of damages attributable to each party. If damages are $1000, and defendant is 80% negligent, plaintiff can recover $800. Texas, if plaintiff is 51% negligent, no recovery. Comparative Negligence:  Comparative Negligence Texas Rule Multiple Defendants Damages $100,000 Plaintiff’s fault = 10% D-1 = 30% (judgment for $30,000) D-2 = 60% (judgment for $60,000) If plaintiff over 50%, no recovery. Ultrahazardous Activity:  Ultrahazardous Activity Strict liability. Comparative or contributory negligence is irrelevant even if victim is negligent or reckless. Old Island Fumigation v. Barbee Product Liabil/ity:  Product Liabil/ity Ford Pinto, Mustang, and “Side Saddle” Pickup Product liability--If manufacturer puts a product in chain of commerce that comes into possession of consumer and is used in normal way, manufacturer is liable for harm for personal injury and property loss caused by product that is “defective” and “unreasonably dangerous.” Cost/Benefit of Ford Motor:  Cost/Benefit of Ford Motor Cost: $11 x 12.5 million = $137 million. Benefits: 180 deaths @ $200,000 each + 180 burn injuries @ $67,000 each + 2100 burned vehicle salvage value @ $700 = $49.15 million. Costs outweigh Benefits by $86.85 million. Rollover $15.5 Million:  Rollover $15.5 Million Pennsylvania jury awarded Hutchinson $15.5 million v. Freightliner. While negotiating a curve on on-ramp, driver struck guiderail and rolled over embankment; he lost an arm and wears a prosthetic. Cab not crashworthy; cruise control poorly designed; failed to disengage while braking. Assumption of Risk:  Assumption of Risk Plaintiff/spectator sued Chicago Cubs for injury pursuing a foul ball. Cubs claimed she was negligent for not moving her season ticket seat to a protected area of the park. Held: For Plaintiff. Comparative negligence abolished assumption of risk. Duran v. Cubs, 1989 U.S. Dist. LEXIS 10969. Injury:  Injury Physical Economic Pain and Suffering Emotional Contracts:  Contracts Introduction Chapter 8 Introduction to Contracts:  Introduction to Contracts Must Jerusalem deliver steel to Hardbody? Does Nicole have a job with Hardbody? Must Nicole purchase Jasper’s house? Do Cassandra and Jasper have a contract? Introduction to Contracts:  Introduction to Contracts Contracts--legally enforceable promises. Predictability Flexibility Elements Agreement Consideration Capacity Legal object. Some MUST be in writing--Statute of Frauds. Introduction to Contracts:  Introduction to Contracts Types of contracts: Bilateral-Unilateral Express-Implied Executed-Executory Valid, Voidable, Void, Unenforceable Employment at Will???:  Employment at Will??? Federal Express v Dutschmann Employment at will was confirmed by signature of plaintiff. It is enforced instead of the “Hearing Policy” stated in employment manual. Dillion v. Champion JogBra:  Dillion v. Champion JogBra Disclaimer of JogBra: “PROCEDURES CONSTITUTE GUIDELINES, NOT AN EMPLOYMENT CONTRACT. Linda Dillion sued for wrongful breach. Issue: Employee handbook promised fair discharge procedures that were inconsistent with disclaimer. Vermont Supreme Court (2003) Winters v. Houston Chronicle :  Winters v. Houston Chronicle Does Texas allow a suit for wrongful discharge of “whistleblower” against private employee? Plaintiff alleged violation of a crime: Texas Deceptive Trade Practices Act 795 SW2d 723; 1990 Tex. Lexis 106. Promissory Estoppel:  Promissory Estoppel Promise is made with knowledge that it will be relied upon. Actual reliance and change of position. Injustice unless promise is enforced. Hoffman v. Red Owl Food Store Quasi Contract:  Quasi Contract Vortt Exploration v. Chevron a) Benefit conferred on defendant, b) Defendant knows of plaintiff’s reasonable expectation to be paid, c) Unjust enrichment. Pyeatte v. Pyeatte:  Pyeatte v. Pyeatte Margrethe agreed to support husband’s law school education if he, in turn, would support her for a graduate degree. Charles got his degree and divorced Margrethe. She sued, and Charles, a newly minted attorney, defended saying “No contract.” 661 P2d 196 (1983) Uniform Commercial Code:  Uniform Commercial Code Texas Bus/Comm Code and UCC. Pittsley v. Houser--mixed goods and services. What happens if goods and services are mixed in the same transaction? Chapter 9:  Chapter 9 Agreement Katrina and Bob:  Katrina and Bob The Handshake . . . . . . what would you enforce? Agreement:  Agreement Offer and Acceptance – “Meeting of the Minds” Offer - intent, terms, communication Intent--objective v. subjective Invitations - Quotes, Advertisements, Auctions Offer:  Offer An offer shows an intent to enter a contract. It names reasonably definite terms. It is communicated to offeree. Newspaper Ad:  Newspaper Ad SATURDAY 9 a.m. Sharp 1 Black Lapin Stole Beautiful Worth $139.50 FIRST COME, FIRST SERVED Duration of Offer :  Duration of Offer An offer lasts for the specified period of time. If no time specified, lasts a reasonable time. It lasts until revoked or rejected. It expires by-operation-of-law when offeror dies. If offeror dies after acceptance, what then?? Auctions:  Auctions UCC 2-328 Auctions with Reserve Auctions without Reserve E-bay??? Sufficient Terms?:  Sufficient Terms? Terms have to be clear enough for a court to know what to enforce. Or else . . . What? Lemming v. Morgan UCC and Open Terms:  UCC and Open Terms UCC 2-204--”goods” only Price: UCC 2-305 Output v. Requirement Delivery, Time, Payment Warranties Merchantability UCC 2-314 Fitness 2-315 Express 2-313 Gateway :  Gateway Agreement to a ShrinkWrap/ClickWrap express warranty with arbitration term? P sued in N.Y – D made motion to dismiss. Arbitration, but . . . You must pay a $4000 arbitration fee, You must go to Chicago, International C.C. rules to govern process. Brower v. Gateway, N.Y. Appellate Division (1998) Specht v. Netscape:  Specht v. Netscape Netscape offered free software “SmartDownLoad” with click of mouse. Specht downloaded and now sues for violation of 2 federal statutes. Netscape moved to compel arbitration term of license that became binding when Specht downloaded. 150 F.Supp. 2d 585 (2001) Termination of Offers:  Termination of Offers Revoke – effective when received. Reject – effective when received. Expiration – terminated at end of time limit. Operation of Law – death of offeror. EXCEPTION . . .:  EXCEPTION . . . REVOCABILITY RULE Firm Offers – UCC 2-205 Common law option contracts UCC 2-207:  UCC 2-207 Sub-part 1: Must be sale of goods. Goods are tangible-movable things Sub-part 2: If merchants involved on both sides of deal, WATCH OUT!!! Merchants are in the business of buying/selling goods Sub-part 3: Implied contract. Leadertex v. Morganton:  Leadertex v. Morganton Sub

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