Business Law Today Study Set 1

The following multiple-choice question is representative of the types of questions available in one of the four sections of ThomsonNOW for Business Law Today. ThomsonNOW also provides feedback for each response option, whether correct or incorrect, and refers to the location within the chapter where the correct answer can be found. Police powers allow states to

Free Speech. Henry Mishkoff is a Web designer whose firm does business as "Webfeats." When Taubman Co. began building a mall called "The Shops at Willow Bend" near Mishkoff's home, Mishkoff registered the domain name "shopsalivillowbend.com" and created a Web site with that address. The site featured information about the mall, a disclaimer indicating that Mishkoff's site was unofficial, and a link to the mall's official site. Taubman discovered Mishkoffs site and filed a suit in a federal district court against him. Mishkoff then registered other names, including "taubmansucks.com," with links to a site documenting his battle with Taubman. (A Web name with a "sucks.com" moniker attached to it is known as a "complaint name," and the process of registering and using such names is known as "Icybergriping.") Taubman asked the court to order Mishkoff to stop using all of these names. Should the court grant Taubman's request? On what basis might the court protect Mishkoff's use of the names? [Taubman Co. Webfeats, 319 F.3d 770 (6th Cir. 2003)]

Supremacy Clause. The Federal Communications Act of 1934 grants the 'fight to govern all interstate telecommunications to the Federal Communications Commission (FCC) and the right to regulate all intrastate telecommunications to the states. The federal Telephone Consumer Protection Act of 1991, the Junk Fax Protection Act of 2005, and FCC rules permit a party to send unsolicited fax ads to recipients with whom they have an "established business relationship" if those ads include an "opt-out" alternative. Section 17538.43 of California's Business and Professions Code (known as "SB 833") was enacted in 2005 to provide the citizens of California with greater protection than that afforded under federal law. SB 833 omits the "established business relationship" exception and requires a sender to obtain a recipient's express consent (or "opt-in") before faxing an ad to that party. The rule applies whether the sender is located in California or outside that state. The Chamber of Commerce of the United States filed a suit against Bill Lockyer, California's state attorney general, seeking to block the enforcement of SB 833. What principles support the plaintiff's position? How should the court resolve the issue? Explain. [Chamber of Commerce of the United States. v. Lockyer, 463 F.3d 1076 (9th Cir. 2006)]

The Equal Protection Clause. With the objectives of preventing crime, maintaining property values, and preserving the quality of urban life, New York City enacted an ordinance to regulate the locations of commercial establishments that featured adult entertainment. The ordinance expressly applied to female, but not male, topless entertainment. Adele Buzzetti owned the Cozy Cabin, a New York City cabaret that featured female topless dancers. Buzzetti and an anonymous dancer filed a suit in a federal district court against the city, asking the court to block the enforcement of the ordinance. The plaintiffs argued, in part, that the ordinance violated the equal protection clause. Under the equal protection clause, what standard should the court apply in considering this ordinance? Under this test, how should the court rule? Why?

Commercial Speech. A mayoral election is about to be held in a large U.S. city. One of the candidates is Luis Delgado, and his campaign supporters wish to post campaign signs on lampposts and utility posts throughout the city. A city ordinance, however, prohibits the posting of any signs on public property. Delgado's supporters contend that the city ordinance is unconstitutional because it violates their rights to free speech. What factors might a court consider in determining the constitutionality of this ordinance?

Critical Legal Thinking. Do you think that the threat of terrorism in the United States justifies: the imposition of limits on the right to privacy? Generally, in the wake of the September 11, 2001, terrorist attacks, should Americans allow the federal government to listen to their phone calls and monitor their e-mails and Internet activity?

Answers to the even-numbered questions in this For Review section can be found in Appendix F at the end of this text. What is the basic structure of the U.S. government?

Answers to the even-numbered questions in this For Review section can be found in Appendix F at the end of this text. What is the Bill of Rights? What freedoms do the First Amendment guarantee?

Question with Sample Answer-The Free Exercise Clause. Thomas worked in the nonmilitary operations of a large firm that produced both military and nonmilitary goods. When the company discontinued the production of nonmilitary goods, Thomas was transferred to the plant producing military equipment. Thomas left his job, claiming that it violated his religious principles to participate in the manufacture of goods to be used in destroying life. In effect, he argued, the transfer to the military equipment plant forced him to quit his job. He was denied unemployment compensation by the state because he had not been effectively "discharged" by the employer but had voluntarily terminated his employment. Did the state's denial of unemployment benefits to Thomas violate the free exercise clause of the First Amendment? Explain.

Case Problem with Sample Answer. To protect the privacy of individuals identified in information systems maintained by federal agencies, the Privacy Act of 1974 regulates the use of the information. The statute provides for a minimum award of $1,000 for "actual damages sustained" caused by "intentional or willful actions" to the person entitled-to recovery:" Buck Doe filed for certain disability benefits with an office of the U.S. Department of Labor (DOI). The application form asked for Doe's Social Security number, which the DOL used to identify his claim on documents sent to groups of claimants, their employers, and the lawyers involved in their cases. This disclosed Doe's Social Security number beyond the limits set by the Privacy Ad. Doe filed a suit in a federal district court against the DOL, alleging that he was "torn * * * all to pieces" and "greatly concerned and worried" because of the disclosure of his Social Security number and its potentially "devastating" consequences. He did not offer any proof of actual injury, however. Should damages be awarded in such circumstances solely on the basis of the agency's conduct, or should proof of some actual injury be required? Why? [Doe v. Chao, 540 U.S. 614, 124 S.Ct. 1204, 157 L.Ed.2d 1122 (2004)]

Privacy. In February 1999, Carl Adler mailed a driver's license renewal application form and a check for $28 to the New York Department of Motor Vehicles (DMV). The form required Adler's Social Security number, which he intentionally omitted. The DMV returned the application and check and told Adler to supply his Social Security number or send proof that the Social Security Administration could not give him a number. Claiming a right to privacy, Adler refused to comply. The DMV responded that federal law authorizes the states to obtain Social Security numbers from individuals in the context of administering certain state programs, including driver's license programs, and that Adler's application would not be processed until he supplied the number. Adler filed a suit in a New York state court against the DMV, asserting in part that it was in violation of the federal Privacy Act of 1974. Adler asked the court to, among other things, order the DMV to renew his license. Should the court grant Adler's request? Why or why not? [Adler v. Jackson, 712 N.Y.S.2d 240 (Sup. 2000)]

Due Process. In 1994, the Board of County Commissioners of Yellowstone County, Montana, created Zoning District 17 in a rural area of the county and a planning and zoning commission for the district. The commission adopted zoning regulations, which provided, among other things, that "dwelling units" could be built only through "on-site construction." Later, county officials could not identify any health or safety concerns that the on-site construction provision addressed, and there was no indication that homes built off-site would affect property values or any other general welfare interest of the community. In December 1999, Francis and Anita Yurczyk bought two forty-acre tracts in District 17. The Yurczyks also bought a modular home and moved it onto the property the following spring. Within days, the county advised the Yurczyks that the home violated the on-site construction regulation and would have to be removed. The Yurczyks filed a suit in a Montana state court against the county, alleging in part that the regulation violated the Yurczyks' due process rights. Should the court rule in the plaintiffs' favor? Explain. [Yurczyk v. Yellowstone County, 2004 MT 3, 319 Mont. 169, 83 P.3d 266 (2004)]

Critical Thinking and Writing Assignment for Business. The commerce clause, as originally interpreted by the United States Supreme Court, was thought to allow the federal government to regulate interstate commerce. Over time, however, the Supreme: Court has made it clear that the commerce clause applies not only to interstate commerce, but also to commerce that is purely intrastate. 'Today, the federal government has the power to regulate every commercial enterprise in the United States. What does this mean for commercial businesses that operate only within the borders of one state? Does it promote or discourage intrastate commerce?

Answers to the even-numbered questions in this For Review section can be found in Appendix F at the end of this text. What constitutional clause allows laws enacted by the federal government to take priority over conflicting state laws?

Answers to the even-numbered questions in this For Review section can be found in Appendix F at the end of this text. Where in the Constitution can the due process clause be found?

Freedom of Religion. A business has a backlog of orders, and to meet its deadlines, management decides to run the firm seven days a week, eight hours a day. One of the employees, Marjorie Tollens, refuses to work on Saturday on religious grounds. Her refusal to work means that the firm may not meet its production deadlines and may therefore suffer a loss of future business. The firm fires Tollens and replaces her with an employee who is willing to work seven days a week. Tollens claims that in terminating her employment, her employer violated her constitutional right to the free exercise of her religion. Do you agree? Why or why not?

A state legislature enacted a statute that required any motorcycle operator or passenger on the state's highways to wear a protective helmet. Jim Alderman, a licensed motorcycle operator, sued the state to block enforcement of the law. Alderman asserted that the statute violated the equal protection clause because it placed requirements on motorcyclists that were not imposed on other motorists. Using the information presented in the chapter, answer the following questions. 1. Why does this statute raise equal protection issues instead of substantive due process concerns? 2. What are the three levels of scrutiny that the courts use in determining whether a law violates the equal protection clause? 3. Which level of scrutiny or test would apply to this situation? Why? 4. Applying this standard or test, is the helmet statute constitutional? Why or why not?

Commerce Clause. Suppose that Georgia enacts a law requiring the use of contoured rear-fender mudguards on trucks and trailers operating within its state lines. The statute further makes it illegal for trucks and trailers to use straight mudguards. In thirty-five other states, straight mudguards arc legal. Moreover, in the neighboring state of Florida, straight mudguards are explicitly required by law. There is some evidence suggesting that contoured mudguards might be a little safer than straight mudguards. Discuss whether this Georgia statute would violate the commerce clause of the U.S. Constitution.

Answers to the even-numbered questions in this For Review section can be found in Appendix F at the end of this text. What constitutional clause gives the federal government the power to regulate commercial activities among the various states?

A Question of Ethics. In 1999, in an effort to reduce smoking by children, the attorney general of Massachusetts issued comprehensive regulations governing the advertising and sale of tobacco products. Among other things, the regulations banned cigarette advertisements within one thousand feet of any elementary school, secondary school, or public playground and required retailers to post any advertising in their stores at least five feet off the floor, out of the immediate sight of young children. A group of tobacco manufacturers and retailers filed suit against the state, claiming that the regulations were preempted by the federal Cigarette Labeling and Advertising Act of 1965, as amended. That act sets uniform labeling requirements and bans broadcast advertising for cigarettes. Ultimately, the case reached the United States Supreme Court, which held that the federal law on cigarette ads preempted the cigarette advertising restrictions adopted by Massachusetts. The only portion of the Massachusetts regulatory package to survive was the requirement that retailers had to place tobacco products in an area accessible only by the sales staff. In view of these facts, consider the following question [Lorillard Tobacco Co. v. Reilly, 533 U.S. 525, 121 S.Ct. 2404, 69 L.Ed.2d 532 (2001)] 1. Some argue that having a national standard for tobacco regulation is more important than allowing states to set their own standards for tobacco regulation. Do you agree? Why or why not? 2 According to the Court in this case, the federal law does not restrict the ability of state and local governments to adopt general zoning restrictions that apply to cigarettes, so long as those restrictions are "on equal terms with other products." How would you argue in support of this reasoning? How would you argue against it?