120 terms

BADM 300

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constitution
Creates the three branches of government
Outlines the powers allocated to each branch
Nothing can supersede the articles of the constitution
Protects individual rights by limiting the power of government
Also allows for modifications
Federalism
By ratifying the constitution, the states delegated certain powers to the federal government (enumerated powers)
States kept all other powers for themselves (reserved powers)
Legislative
article 1
Bicameral- two houses of congress, senate, and house of representative, both houses need to agree on any laws that are made
Executive
article 2
Lists presidential powers, doesn't mention agencies / departments
Judicial
article 3
There are few nations where the federal government has limited power
Federalism
you have federal government and state government's (states assign constitution and grant power to the federal government, certain powers given to the federal government)
substantive
laws must be clear
procedural
- people entitle to notice and a hearing before deprived of life, liberty, or property
statutes
Securities Act of 1933- created the framework for the regulation for the sale or stock and public stock markets in this country.
Securities Exchange Act of 1934
Sarbanes-Oxley Act of 2002
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010
security
an ownership or debt interest in a company
reporting company
publically traded companies and companies that have made registered offerings
reasons to make companies report
to give shareholders good information
reports required to file
Annual Report; Quarterly Report, Monthly Report
IPO
when a company sells shares to the public
registration statement
must file a registration statement which provides info on what is being offered, how the company is run, what the money will be used for, and any risk factors
prospectus
must be filed with the registration statement; contains a lot of the same information but presented differently; this is the document used to market the stock to the public
reg a offering
non reporting companies can sell up to 5 million of stock per year in a simplified process; must file offering with the SEC and give investors an offering circular
small company offering registration
enables small business to file a form with the SEC and can sell up to $1 million in securities
well-known seasoned issuer
can sell securities without as much regulation if you've sold 1 billion in the previous 3 years or have 700 million in outstanding public shares
types of exempt securities
1. Issued by the gov't
2. Short term notes
3. NFP securities
4. Bank securities
5. Stock dividends/splits
6. Security exchanges in corporate reorganizations
nonissuer exemption
if you aren't the original company, you don't have to register to sell stock between neighbors
intrastate offering exemption
if your stock offering only impacts one state, the SEC has no authority to force you to register your stock
private placement exemption
if the people buying stock are rich, the SEC doesn't need to protect them as much so no need for registration, must have a net worth of at least 1 mil or annual income of at least 200,000
insider trading
trading stock based on non-public information, or providing non-public information to someone who then trades the stock
merger
shareholder of target company gets money but has no say in the company anymore; acquiring company gets company free and clear of any shareholders who want different things but have to come up with the cash to pay shareholders off
share exchange
the inverse of a traditional merger acquiring company gives Target Company some of their shares in exchange for some of the target company's shares. Very popular in like the big company trying to get stock from smaller companies. Target company pros- own stock in well-known company; con's don't have any cash. Acquiring company- didn't have to come up with any cash just had to give up stock but now have extra shareholders that might have weird says in the company
short-form merger
when company A already owns at least 90% of the shares of corporation b; no shareholder or board approval necessary from substidary and no shareholder approval necessary from parent corporation
asset purchase
only requires board recommendation and shareholder approval of selling corporation; when acquiring company wants everything that the target company owns but does not want to own the target company, so the company just buys all of the target company's stuff
tender offers rules
offer must stay open for at least 20 business days; any change in the offer requires an additional 10 days; if acquirer ups the price its willing to pay, all previously tendered shares must receive the same price, if too many shares are tendered, all shares must be purchased on a pro rata basis- if you are offered 75% and you only want 50%, you have to buy 2/3 of their stock to make it fair for everybody
tender offers defenses
persuasion; lawsuits to delay; selling a crown jewel; poison pill; white knight; reverse tender offer, greenmail
gift
intent; delivery; acceptance
mislaid property
1. True owner
2. Owner of location
3. finder
lost property
1. True owner 2. finder
abandoned property
1. finder
bailment
when you give your property to someone else for safe keeping
for the benefit of bailor
this is a favor, bailee only owes a duty of slight care
for the benefit of bailee
bailee asks to use bailor's property, bailee owes a duty of great care
mutual benefit
bailee owes duty of reasonable care
warehouse company
business of storing property for money, has a lien on the stored property ( if you don't pay the storage fees, they can take your stuff)
common carrier
transportation services to the general public, strict liability for loss or damages (hanging onto your stuff temporarily)
innkeeper
strict liability for damage- common law, innkeepers' statutes limit liability if the inn has a safe or expressly limits liability
insurance
a contract (policy) whereby one party agrees to indemnify another against loss/damage/ liability
duties of an insured person
pay premiums, notify the insurer of insured events within reasonable time, cooperated with insurer's investigation
duties of an insurance company
duty to defend, duty to pay
deductible
have to pay deductible plan with a specific premium
exclusions
things not included in the plan
coinsurance
like deductible, insurance says they will pay a percentage and you will pay the remainder percentage
incontestability
prohibits insurance company from denying your claim because you lied a while ago
types of insurance
life
health/disability
vehicle
homeowners/renters
suicide clause
2 yrs usually, to prevent people buying life insurance and then immediately committing suicide
enumerated powers
the states delegated certain powers to the federal government
reserved powers
states kept all other powers for themselves
checks and balances
president has veto power and nominates judges; Supreme Court reviews legislative and executive actions; legislature can enact bills changing common law and can impeach the president
first amendment
freedom of speech/ religion- offensive speech is protected by the first amendment, obscene speech is not protected; commercial speech is not protected, speech made in an attempt to make money only applies to the government; unprotected speech: dangerous, inciting violence/revolution, defamatory, child pornography, obscene (gov cannot stop you from saying offensive things but your employer can)(child porn-obscene; Nazi-offensive but not obscene)
fifth amendment
due process; substantive- laws must be clear; procedural- people entitle to notice and a hearing before deprived of life, liberty or property
fourteenth amendment
equal protection (all American's are entitled to equal protection under the law)
Federal lawsuits
DOJ and FTC can sue; civil damages (including triple damages); criminal charges under the Sherman act
private party lawsuits
civil damages including triple damages and attorney fees
price fixing
competitors must be free to charge whatever they want for products
division of markets
competitors agree to only sell products in specific areas that split the market
group boycotts
competitors get together to boycott the suppliers
resale price maintenance
a manufacturer sells its products to a retail outlet, and dictates what the retail outlet can charge its customers
monopoly power
power to control prices or exclude competition. Market share > 70% is generally monopoly power
willful act of monopolization
restraint of trade, predatory pricing; innocent/ natural monopolies are not illegal
conglomerate merger
anything that doesn't fit into previous categories; these are ok unless it would give one of the companies an unfair advantage in its industry
failing company doctrine
no other reasonable alternative for the failing company; no other purchaser available; assets of failing company would disappear from the market without the merger
small company doctrine
if they can compete with a large company more effectively
tying arrangements
illegal to refuse to sell an item unless the purchaser also agrees to buy some other item
price discrimination
selling the same product to similarly situated customers for different prices is illegal
cost justification
the seller saves shipping by selling 10000 items instead of 1000 so can sell for a lesser price
antitrust exemptions
statutory exemptions
implied exemptions
state action exemptions
Food safety
regulates food safety, prohibits sale of adulterated food, false/misleading labeling of food, requires nutrition labeling of food, regulation of testing, manufacture, distribution, marketing and sale of drugs, regulation of cosmetics, regulation of medicinal devices
CPSC
regulates the safety of consumer products; can force manufacturers to recall defective products or repair them
FTC
regulates a lot of stuff, including prohibiting false and deceptive advertising, misinformation/ omission is likely to mislead a reasonable customer; make an unsubstantiated claim
CFPB
combines the functions of a handful of federal agencies; very broad authority
EPA
air pollution
water pollution
land pollution
SEC powers
SEC adopts rules to interpret the acts; investigates and prosecutes securities violations; regulates securities brokers and advisors
surface/subsurface/air rights
when you buy land, you usually just buy the surface rights; the subsurface (mineral rights) may be sold separately; land owners generally also own the air rights, subject to FAA restrictions
Fee simple
I give you green acre" highest form of real property ownership; fullest bundle of rights
Fee simple defeasible
"I give you green acre, so long as it is never used as a dramshop"; you lose the property if the condition occurs
life estate
"I give you green acre to John for his life, then to Jane." John has the rights while he is alive, but no absolute rights. Once he dies, then the rights go to Jane and etc.
tenants in common
each party owns a pro rata undivided interest in the property; each party's interest is freely transferable and stays with the party, even upon death
joint tenants
upon death, that party's interest is not freely transferable (must have consent from other party; parties must be married)
tenants by the entirety
same as joint tenants but each party's interest is not freely transferable (must have consent from other party; parties must be married)
community property
any property acquired during a marriage is automatically jointly owned and cannot be transferred without consent; does not applied to anything brought into the marriage individually owned
condominiums
owners have a fee simple interest in their unit, and a concurrent interest in the common areas
cooperatives
a corporation owns the building and residents own shares in the corporation. Each resident leases a unit under a renewable, long-term lease
warranty deed
grantor is warranting that he has good title to the property, has the right to sell it, and that there are not encumbrances on it
quitclaim deed
grantor basically says "whatever rights I have in this property, I give them to you. But no guarantees of what those rights are."
function of title insurance
assures grantees that they're getting good title
marketabletitle
means the property is free from encumbrances or other defects that would affect the value/ownership of the property; sellers have duty to give good title to buyers
adverse possession
if it is long enough 7-20 years; if it is open, visible and notorious; if its actual and exclusive; if its continuous and peaceful; if its hostile and adverse (you don't have permission to be on land)
easements
a non-possessory interest in land that gives you the right to use it for some purpose
license
gives you the right to enter onto someone's property for a specified period of time (you don't own it but you can use it)
profit
give you the right to take something from someone's property (timber, minerals)
tenancy for years
any set duration; terminates automatically upon expiration
periodic tenancy
no set end date, but rent is due at certain intervals (monthly) one period's notice required to terminate
tenancy at will
may be terminated by either party at any time
tenancy at sufferance
when a tenant wrongfully holds over after termination
landlord duties
deliver possession of leased premises; not to interfere with tenant's quiet enjoyment; maintain the premises
tenant duties
pay rent; use premises for proper purposes; don't commit waste; don't disturb other tenants
lease transfers
if the landlord sells the premises, the lease is still enforceable against the new landlord; tenant may assign a lease to someone else, but still remains liable on it unless the landlord excuses him.her
zoning
established land use districts within a municipality (residential, commercial, and industrial)
anti-discrimination
fair housing act of 1968; it is illegal to refuse to sell/rent/finance housing based on race, color, national origin, sex, religion, disability, or family status
eminent domain
no person shall be held to answer for capital, not be deprived of life, liberty or property without due process of law, not shall private property be taken for public use without just compensation
international law
any agreements with other countries into which a nation has voluntarily entered
commerce clause
congress has the power to regulate commerce with foreign nations; state cannot pass laws that impact foreign commerce
treaty clause
the president shall have power by and with the advice and consent of the senate to make treaties provided 2/3 of the senators present concur.
NAFTA
the north American free trade agreement is a treaty between the US, Canada, and Mexico- eliminates or greatly reduces more tariffs and other trade barriers between the three nations
UN
most important organization; purpose is to maintain peace/ security in the world, promote economic and social cooperation, protect human rights
EU
primarily attempts to make trade between members more open and free
other multinational organizations
Association of Southeast Asian Nations; North Atlantic treaty organization; Organization of Petroleum exporting countries; World trade organization
bankruptcy
a set of laws that allow debtors to be relieved of some of their debts in order to get a fresh start if they are unable to pay their debts
bankruptcy players
bankruptcy court
bankruptcy estate
bankruptcy trustee
fraudulent transfer
fraudulent transfer: if a debtor transfers assets within the 2-year period prior to filing the petition and either doesn't receive FV for them or does so with the intent to avoid creditors, the court can undo the transfer and get the assets back
exempt property
federal law exempts assets like a certain amount of equity in your home, some equity in a motor vehicle, a small amount of household goods. State can also enact their own exemptions
Chapter 7
straight bankruptcy- only chapter that liquidates the debtors assets
Chapter 13
for an individual debtor with a regular income, chapter 13 allows them to keep their stuff, but have their debts readjusted into a payment plan, once that is completed, the debts are discharged
Chapter 11
generally used for corporate reorganizations; the trustee doesn't control the debtors assets, but the debtor remains in possession
Consumer Financial Protection Bureau
Truth in lending act
Consumer leasing act
Fair credit billing act
Fair credit reporting act
Fair and accurate credit transactions act
Fair debt collection practices
Fair credit and charge card disclosure act
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