UNIT1 The Legal Environment of Business 1
Chapter 1Introduction to Law and Legal Reasoning 2
Schools of Jurisprudential Thought 2
Business Activities and the Legal Environment 4
Sources of American Law 6
The Common Law Tradition 7
The Common Law Today 13
Classifications of Law 14
How to Find Primary Sources of Law 15
How to Read and Understand Case Law 21
REVIEWING：INTRODUCTION TO LAW AND LEGAL REASONING 27
TERMS AND CONCEPTS 27
QUESTIONS AND CASE PROBLEMS 28
LAW ON THE WEB 29
LEGAL RESEARCH EXERCISES ON THE WEB 29
Chapter 2 Courts and Alternative Dispute Resolution 30
The Judiciary’s Role in American Government 30
Basic Judicial Requirements 31
CASE 2.1 Mastondrea v.Occidental Hotels Management S.A. 32
The State and Federal Court Systems 37
Alternative Dispute Resolution 41
CASE 2.2 Buckeye Check Cashing，Inc.v. Cardegna 44
EXTENDED CASE 2.3 Morrison v.Circuit City Stores，Inc. 46
International Dispute Resolution 48
REVIEWING：COURTS AND ALTERNATIVE DISPUTE RESOLUTION 49
TERMS AND CONCEPTS 49
QUESTIONS AND CASE PROBLEMS 50
LAW ON THE WEB 52
LEGAL RESEARCH EXERCISES ON THE WEB 52
Chapter 3 Court Procedures 53
Procedural Rules 53
Pretrial Procedures 55
EXTENDED CASE 3.1 Cruz v.FagorAmerica，Inc. 58
CASE 3.2 Computer Task Group，Inc.v.Brotby 62
The Trial 66
CASE 3.3 Novak v.Tucows，Inc. 68
Posttrial Motions 70
The Appeal 71
Enforcing the Judgment 72
REVIEWING：COURT PROCEDURES 73
TERMS AND CONCEPTS 73
QUESTIONS AND CASE PROBLEMS 74
SPECIAL CASE ANALYSIS：CRUZ v.FAGOR AMERICA，INC. 75
LAW ON THE WEB 76
LEGAL RESEARCH EXERCISES ON THE WEB 76
Chapter 4 Constitutional Authority to Regulate Business 77
The Constitutional Powers of Government 77
CASE 4.1 Granholm v.Heald 80
Business and the Bill of Rights 83
CASE 4.2 Bad Frog Brewery，Inc.v.New York State LiquorAuthority 87
EXTENDED CASE 4.3 Lott v.Levitt 88
Due Process and Equal Protection 92
Privacy Rights 94
REVIEWING：CONSTITUTIONAL AUTHORITY TO REGULATE BUSINESS 95
TERMS AND CONCEPTS 95
QUESTIONS AND CASE PROBLEMS 96
SPECIAL CASE ANALYSIS：LOTT V. LEVITT 97
LAW ON THE WEB 98
LEGAL RESEARCH EXERCISES ON THE WEB 98
Chapter 5 Ethics and Business Decision Making 99
Business Ethics 99
EXTENDED CASE 5.1 Baum v.Blue Moon Ventures，LLC 101
Approaches to Ethical Reasoning 103
CASE 5.2 Fog Cutter Capital Group，Inc.v.Securities and Exchange Commission 104
How the Law Influences Business Ethics 106
CASE 5.3 Guin v.Brazos Higher Education Service Corp. 109
Making Ethical Business Decisions 110
Business Ethics on a Global Level 111
REVIEWING：ETHICS AND BUSINESS DECISION MAKING 113
TERMS AND CONCEPTS 113
QUESTIONS AND CASE PROBLEMS 114
LAW ON THE WEB 116
LEGAL RESEARCH EXERCISES ON THE WEB 116
FOCUS ON ETHICS：ETHICS AND THE LEGAL ENVIRONMENT OF BUSINESS 117
UNIT2 Torts and Crimes 121
Chapter 6 Intentional Torts 122
The Basis of Tort Law 122
Intentional Torts against Persons 123
CASE 6.1 Anderson v.Mergenhagen 128
Business Torts 131
Intentional Torts against Property 133
EXTENDED CASE 6.2 Registercom，Inc.v.Verio，Inc. 134
Cyber Torts 136
CASE 6.3 Fair Housing Council of San Fernando Valley v.Roommate.com，LLC 137
REVIEWING：INTENTIONAL TORTS 140
TERMS AND CONCEPTS 140
QUESTIONS AND CASE PROBLEMS 141
LAW ON THE WEB 143
LEGAL RESEARCH EXERCISES ON THE WEB 143
Chapter 7 Negligence and Strict Liability 144
Negligence 144
CASE 7.1 Izquierdo v.Gyroscope，Inc. 145
CASE 7.2 Palsgrafv. Long Island Railroad Co. 148
Defenses to Negligence 149
EXTENDED CASE 7.3 Sutton v.Eastern New York Youth Soccer Association，Inc. 150
Special Negligence Doctrines and Statutes 152
Strict Liability 153
REVIEWING：NEGLIGENCE AND STRICT LIABILITY 154
TERMS AND CONCEPTS 154
QUESTIONS AND CASE PROBLEMS 155
SPECIAL CASE ANALYSIS：SUTTON V.EASTERN NEW YORK YOUTH SOCCFR ASSOCIATION，INC. 156
LAW ON THE WEB 156
LEGAL RESEARCH EXERCISES ON THE WEB 156
Chapter 8 Intellectual Property and Internet Law 157
Trademarks and Related Property 157
CASE 8.1 The Coca-Cola Co.v.The Koke Co.of America 158
CASE 8.2 Menashe v.V Secret Catalogue，Inc. 161
Cyber Marks 164
Patents 167
EXTENDED CASE 8.3 KSR International Co.v.Teleflex Inc. 168
Copyrights 171
Copyrights in Digital Information 172
CASE 8.4 Sony BMG Music Entertainment v.Villarreal 176
Trade Secrets 178
International Protection for Intellectual Property 179
REVIEWING：INTELLECTUAL PROPERTY AND INTERNET LAW 180
TERMS AND CONCEPTS 180
QUESTIONS AND CASE PROBLEMS 181
LAW ON THE WEB 183
LEGAL.RESEARCH EXERCISES ON THE WEB 183
Chapter 9 Criminal Law and Cyber Crime 184
Civil Law and Criminal Law 184
Classification of Crimes 185
Criminal Liability 186
Types of Crimes 188
CASE 9.1 United States v.Lyons 190
Defenses to Criminal Liability 193
Criminal Procedures 198
EXTENDED CASE 9.2 Fellers v.United States 198
CASE 9.3 Miranda v.Arizona 200
Cyber Crime 204
REVIEWING：CRIMINAL LAW AND CYBER CRIME 207
TERMS AND CONCEPTS 207
QUESTIONS AND CASE PROBLEMS 208
LAW ON THE WEB 210
LEGAL RESEARCH EXERCISES ON THE WEB 210
FOCUS ON ETHICS：ETHICS AND TORTS AND CRIMES 211
UNIT3 Contracts and E-Contracts 215
Chapter 10 Nature and Terminology 216
An Overview of Contract Law 216
Elements of a Contract 217
Types of Contracts 218
CASE 10.1 Ardito v.City of Providence 219
CASE 10.2 Gary Porter Construction v.Fox Construction，Inc. 221
Quasi Contracts 224
Interpretation of Contracts 225
EXTENDED CASE 10.3 Wagner v.Columbia Pictures Industries，Inc. 226
REVIEWING：NATURE AND TERMINOLOGY 228
TERMS AND CONCEPTS 229
QUESTIONS AND CASE PROBLEMS 229
SPECIAL CASE ANALYSIS：WAGNER V.COLUMBIA PICTURES INDUSTRIES，INC. 231
LAW ON THE WEB 231
LEGAL RESEARCH EXERCISES ON THE WEB 231
Chapter 11 Agreement 232
Requirements of the Offer 232
CASE 11.1 Lucy v. Zehmer 233
CASE 11.2 Trell v.American Association of the Advancement of Science 235
EXTENDED CASE 11.3 Baer v.Chase 237
Termination of the Offer 239
Acceptance 242
Technology and Acceptance Rules 246
REVIEWING：AGREEMENT 246
TERMS AND CONCEPTS 246
QUESTIONS AND CASE PROBLEMS 247
LAW ON THE WEB 249
LEGAL RESEARCH EXERCISES ON THE WEB 249
Chapter 12 Consideration 250
Elements of Consideration 250
CASE 12.1 Hamer v.Sidway 250
CASE 12.2 Barfield v.Commerce Bank，N.A. 252
Adequacy of Consideration 253
Agreements That Lack Consideration 254
EXTENDED CASE 12.3 Blackmon v.Iverson 255
Settlement of Claims 257
Exceptions to the Consideration Requirement 259
REVIEWING：CONSIDERATION 261
TERMS AND CONCEPTS 262
QUESTIONS AND CASE PROBLEMS 262
LAW ON THE WEB 264
LEGAL RESEARCH EXERCISES ON THE WEB 264
Chapter 13 Capacity and Legality 265
Contractual Capacity 265
EXTENDED CASE 13.1 Yale Diagnostic Radiology v.Estate of Harun Fountain 267
Legality 271
CASE 13.2 Stultz v.Safety and Compliance Management，Inc. 274
CASE 13.3 Thibodeau v. Comcast Corp. 277
REVIEWING：CAPACITY AND LEGALITY 282
TERMS AND CONCEPTS 282
QUESTIONS AND CASE PROBLEMS 283
LAW ON THE WEB 285
LEGAL RESEARCH EXERCISES ON THE WEB 285
Chapter 14 Mistakes，Fraud，and Voluntary Consent 286
Mistakes 286
EXTENDED CASE 14.1 Roberts v.Century Contractors，Inc. 287
Fraudulent Misrepresentation 290
CASE 14.2 Vokes v.Arthur Murray，Inc. 290
Undue Influence 295
Duress 296
Adhesion Contracts and Unconscionability 296
CASE 14.3 Simpson v.MSA of Myrtle Beach，Inc. 297
REVIEWING：MISTAKES，FRAUD，AND VOLUNTARY CONSENT 299
TERMS AND CONCEPTS 300
QUESTIONS AND CASE PROBLEMS 300
LAW ON THE WEB 302
LEGAL RESEARCH EXERCISES ON THE WEB 302
Chapter 15 The Statute of Frauds—Writing Requirement 303
The Origins of the Statute of Frauds 303
Contracts That Fall within the Statute of Frauds 303
EXTENDED CASE 15.1 Sawyer v.Mills 305
CASE 15.2 School-Link Technologies，Inc.v.Applied Resources，Inc. 309
Sufficiency of the Writing 310
The Parole Evidence Rule 312
CASE 15.3 Yocca v.Pittsburgh Steelers Sports，Inc. 313
The Statute of Frauds in the International Context 316
REVIEWING：THE STATUTE OF FRAUDS—WRITING REQUIREMENT 317
TERMS AND CONCEPTS 318
QUESTIONS AND CASE PROBLEMS 318
LAW ON THE WEB 320
LEGAL RESEARCH EXERCISES ON THE WEB 320
Chapter 16 Third Party Rights 321
Assignments and Delegations 321
CASE 16.1 Martha Graham School and Dance Foundation，Inc.v.Martha Graham Center of Contemporary Dance，Inc. 323
Third Party Beneficiaries 328
EXTENDED CASE 16.2 Midwestern Indemnity Co.v.Systems Builders，Inc. 329
CASE 16.3 Revels v.Miss America Organization 331
REVIEWING：THIRD PARTY RIGHTS 333
TERMS AND CONCEPTS 333
QUESTIONS AND CASE PROBLEMS 334
LAW ON THE WEB 336
LEGAL RESEARCH EXERCISES ON THE WEB 336
Chapter 17 Performance and Discharge 337
Conditions 337
Discharge by Performance 338
EXTENDED CASE 17.1 Jacob ＆ Youngs v.Kent 339
CASE 17.2 Shah v.Cover-It，Inc. 341
Discharge by Agreement 344
Discharge by Operation of Law 345
CASE 17.3 Facto v.Pantagis 347
REVIEWING：PERFORMANCE AND DISCHARGE 349
TERMS AND CONCEPTS 350
QUESTIONS AND CASE PROBLEMS 350
LAW ON THE WEB 352
LEGAL RESEARCH EXERCISES ON THE WEB 352
Chapter 18 Breach of Contract and Remedies 353
Damages 353
CASE 18.1 Hadley v.Baxendale 355
EXTENDED CASE 18.2 Hanson v.Boeder 357
Rescission and Restitution 359
Specific Performance 360
CASE 18.3 Stainbrook v.Low 360
Reformation 362
Recovery Based on Quasi Contract 362
Election of Remedies 363
Waiver of Breach 364
Contract Provisions Limiting Remedies 365
REVIEWING：BREACH OF CONTRACT AND REMEDIES 366
TERMS AND CONCEPTS 366
QUESTIONS AND CASE PROBLEMS 366
LAW ON THE WEB 369
LEGAL RESEARCH EXERCISES ON THE WEB 369
Chapter 19 E-Contracts and E-Signatures 370
Online Contract Formation 370
CASE 19.1 Feldman v.Google，Inc. 371
CASE 19.2 Mortgage Plus，Inc. v.DocMagic，Inc. 374
E-Signatures 376
EXTENDED CASE 19.3 Amber Chemical，Inc.v.Reilly Industries，Inc. 378
The Uniform Electronic Transactions Act 381
REVIEWING：E-CONTRACTS AND E-SIGNATURES 383
TERMS AND CONCEPTS 383
QUESTIONS AND CASE PROBLEMS 384
LAW ON THE WEB 386
LEGAL RESEARCH EXERCISES ON THE WEB 386
FOCUS ON ETHICS：CONTRACT LAW AND THE APPLICATION OF ETHICS 387
UNIT4 Domestic and International Sales and Lease Contracts 391
Chapter20 The Formation of Sales and Lease Contracts 392
The Uniform Commercial Code 392
The Scope of Article 2—The Sale of Goods 393
CASE 20.1 Hammer v.Thompson 396
The Scope of Article 2A—Leases 398
The Formation of Sales and Lease Contracts 398
CASE 20.2 Sun Coast Merchandise Corp.v.Myron Corp. 402
EXTENDED CASE 20.3 Jones v.Star CreditCorp. 408
Contracts for the International Sale of Goods 410
REVIEWING：THE FORMATION OF SALES AND LEASE CONTRACTS 413
TERMS AND CONCEPTS 413
QUESTIONS AND CASE PROBLEMS 414
LAW ON THE WEB 416
LEGAL RESEARCH EXERCISES ON THE WEB 416
Appendix to Chapter 20：An Example of a Contract for the International Sale of Coffee 417
Chapter 21 Title，Risk，and Insurable Interest 421
Identification 421
When Title Passes 422
CASE 21.1 Empire Fire and Marine Insurance Co.v.Banc Auto，Inc. 423
CASE 21.2 Lindholm v.Brant 425
Risk of Loss 427
EXTENDED CASE 21.3 Spray-Tek，Inc.v.Robbins Motor Transportation，Inc. 428
Insurable Interest 433
REVIEWING：TITLE，RISK，AND INSURABLE INTEREST 434
TERMS AND CONCEPTS 434
QUESTIONS AND CASE PROBLEMS 434
SPECIAL CASE ANALYSIS：SPRAY-TEK，INC.V.ROBBINS MOTOR TRANSPORTATION，INc. 436
LAW ON THE WEB 436
LEGAL RESEARCH EXERCISES ON THE WEB 436
Chapter 22 Performance and Breach of Sales and Lease Contracts 437
Performance Obligations 437
Obligations of the Seller or Lessor 438
CASE 22.1 Maple Farms，Inc.v.City School District of Elmira 441
Obligations of the Buyer or Lessee 443
Anticipatory Repudiation 443
Remedies of the Seller or Lessor 445
Remedies of the Buyer or Lessee 447
CASE 22.2 Jauregui v.Bobb’s Piano Sales ＆Service，Inc. 448
EXTENDED CASE 22.3 Fitl v.Strek 450
Additional Provisions Affecting Remedies 452
Dealing with International Contracts 452
REVIEWING：PERFORMANCE AND BREACH OF SALES AND LEASE CONTRACTS 454
TERMS AND CONCEPTS 455
QUESTIONS AND CASE PROBLEMS 455
LAW ON THE WEB 457
LEGAL RESEARCH EXERCISES ON THE WEB 457
Chapter 23 Warranties and Product Liability 458
Types of Warranties 458
CASE 23.1 Shoop v.DaimlerChrysler Corp. 461
CASE 23.2 Webster v.Blue Ship Tea Room，Inc. 463
Overlapping Warranties 465
Warranty Disclaimers and Limitations on Liability 467
Product Liability 468
Strict Product Liability 469
EXTENDED CASE 23.3 Crosswhite v.Jumpking，Inc. 472
Defenses to Product Liability 475
REVIEWING：WARRANTIES AND PRODUCT LIABILITY 477
TERMS AND CONCEPTS 477
QUESTIONS AND CASE PROBLEMS 477
LAW ON THE WEB 480
LEGAL RESEARCH EXERCISES ON THE WEB 480
FOCUS ON ETHICS：DOMESTIC AND INTERNATIONAL SALES AND LEASE CONTRACTS 481
UNIT5 Negotiable Instruments 485
Chapter 24 The Function and Creation of Negotiable Instruments 486
Articles 3 and 4 of the UCC 486
Types of Negotiable Instruments 487
Requirements for Negotiability 490
EXTENDED CASE 24.1 Gowin v.Granite Depot，LLC 494
CASE 24.2 Foundation Property Investments，LLC v.CTP，LLC 496
Factors Not Affecting Negotiability 500
REVIEWING：THE FUNCTION AND CREATION OF NEGOTIABLE INSTRUMENTS 500
TERMS AND CONCEPTS 501
QUESTIONS AND CASE PROBLEMS 501
LAW ON THE WEB 503
LEGAL RESEARCH EXERCISES ON THE WEB 503
Chapter 25 Transferability and Holder in Due Course 504
Negotiation 504
Indorsements 505
Miscellaneous Indorsement Problems 508
EXTENDED CASE 25.1 Hyatt Corp.v.Palm Beach National Bank 509
CASE 25.2 Graves v.Johnson 511
Holder versus Holder in Due Course 512
Requirements for HDC Status 513
CASE 25.3 Mid Wisconsin Bank v.Forsgard Trading，Inc. 514
Holder through an HDC 518
REVIEWING：TRANSFERABILITY AND HOLDER IN DUE COURSE 519
TERMS AND CONCEPTS 520
QUESTIONS AND CASE PROBLEMS 520
LAW ON THE WEB 522
LEGAL RESEARCH EXERCISES ON THE WEB 522
Chapter 26 Liability，Defenses，and Discharge 523
Signature Liability 523
Warranty Liability 530
CASE 26.1 Wachovia Bank，N.A.v.Foster Bancshares，Inc. 532
Defenses 533
EXTENDED CASE 26.2 Keesling v.T.E.K. Partners，LLC 535
Discharge 539
REVIEWING：LIABILITY，DEFENSES，AND DISCHARGE 540
TERMS AND CONCEPTS 541
QUESTIONS AND CASE PROBLEMS 541
LAW ON THE WEB 543
LEGAL RESEARCH EXERCISES ON THE WEB 543
Chapter 27 Checks and Banking in the Digital Age 544
Checks 544
The Bank-Customer Relationship 546
Honoring Checks 546
CASE 27.1 Nesper v.Bank of America 549
Accepting Deposits 554
CASE 27.2 Bank One，N.A.v.Dunn 557
EXTENDED CASE 27.3 NBT Bank，N.A.v.First National Community Bank 559
Electronic Fund Transfers 562
E-Money and Online Banking 563
REVIEWING：CHECKS AND BANKING IN THE DIGITAL AGE 566
TERMS AND CONCEPTS 567
QUESTIONS AND CASE PROBLEMS 567
SPECIAL CASE ANALYSIS：NBT BANK，N.A.v.FIRST NATIONAL COMMUNITY BANK 568
LAW ON THE WEB 569
LEGAL RESEARCH EXERCISES ON THE WEB 569
FOCUS ON ETHICS：NEGOTIABLE INSTRUMENTS 570
UNIT6 Creditors’ Rights and Bankruptcy 573
Chapter 28 Creditors’ Rights and Remedies 574
Laws Assisting Creditors 574
CASE 28.1 Indiana Surgical Specialists v.Griffin 576
Suretyship and Guaranty 578
EXTENDED CASE 28.2 JSV，Inc.v.Hene Meat Co.，Inc. 580
Protection for Debtors 582
REVIEWING：CREDITORS’ RIGHTS AND REMEDIES 582
TERMS AND CONCEPTS 583
QUESTIONS AND CASE PROBLEMS 583
LAW ON THE WEB 585
LEGAL RESEARCH EXERCISES ON THE WEB 585
Chapter 29 Secured Transactions 586
The Terminology of Secured Transactions 586
Creating a Security Interest 587
Perfecting a Security Interest 588
EXTENDED CASE 29.1 Corona Fruits ＆ Veggies，Inc.v.Frozsun Foods，Inc. 592
The Scope of a Security Interest 595
Priorities 597
CASE 29.2 Heartland Bank v.National City Bank 598
Rights and Duties of Debtors and Creditors 602
Default 602
CASE 29.3 Layne v.Bank One，Kentucky，N.A. 604
REVIEWING：SECURED TRANSACTIONS 607
TERMS AND CONCEPTS 608
QUESTIONS AND CASE PROBLEMS 608
SPECIAL CASE ANALYSIS：CORONA FRUITS ＆ VEGGIES，INC.V.FROZSUN FOODS，INC. 609
LAW ON THE WEB 610
LEGAL RESEARCH EXERCISES ON THE WEB 610
Chapter 30 Bankruptcy Law 611
Bankruptcy Proceedings 611
Liquidation Proceedings 612
EXTENDED CASE 30.1 Hebbring v.U.S.Trustee 614
CASE 30.2 In re Mosley 621
Reorganizations 624
Bankruptcy Relief under Chapter 13 and Chapter 12 626
CASE 30.3 In re Buis 626
REVIEWING：BANKRUPTCY LAW 631
TERMS AND CONCEPTS 631
QUESTIONS AND CASE PROBLEMS 631
LAW ON THE WEB 634
LEGAL RESEARCH EXERCISES ON THE WEB 634
FOCUS ON ETHICS：CREDITORS’ RIGHTS AND BANKRUPTCY 635
UNIT7 Agency and Employment 637
Chapter 31 Agency Formation and Duties 638
Agency Relationships 638
CASE 31.1 Alberty-Velez Corporacion de Puerto Rico 640
Formation of the Agency Relationship 642
CASE 31.2 Motorsport Marketing，Inc.v.Wiedmaier，Inc. 643
Duties of Agents and Principals 645
EXTENDED CASE 31.3 Cossels v.Fleet National Bank 646
Rights and Remedies of Agendies and Principals 648
REVIEWING：AGENCY FORMATION AND DUTIES 650
TERMS AND CONCEPTS 650
QUESTIONS AND CASE PROBLEMS 650
LAW ON THE WEB 652
LEGAL RESEARCH EXERCISES ON THE WEB 652
Chapter 32 Liability to Third Parties and Termination 653
Scope of Agent’s Authority 653
CASE 32.1 Ermoian v.Desert Hospital 655
Liability for Contracts 657
Liability for Torts and Crimes 659
CASE 32.2 In re Selheimer ＆ Co. 660
EXTENDED CASE 32.3 Galvao v.G.R.Robert Construction Co. 664
Termination of an Agency 666
REVIEWING：LIABILITY TO THIRD PARTIES AND TERMINATION 669
TERMS AND CONCEPTS 669
QUESTIONS AND CASE PROBLEMS 669
LAW ON THE WEB 672
LEGAL RESEARCH EXERCISES ON THE WEB 672
Chapter 33 Employment and Labor Law 673
Employment at Will 673
CASE 33.1 Wendeln v.The Beatrice Manor，Inc. 675
Wage and Hour Laws 676
CASE 33.2 Mims v.Starbucks Corp. 678
Labor Unions 681
Worker Health and Safety 683
Income Security，Pension，and Health Plans 685
Family and Medical Leave 687
EXTENDED CASE 33.3 Nevada Department of Human Resources v.Hibbs 688
Employee Privacy Rights 689
Employment-Related Immigration Laws 692
REVIEWING：EMPLOYMENT .AND LABOR LAW 692
TERMS AND CONCEPTS 693
QUESTIONS AND CASE PROBLEMS 693
LAW ON THE WEB 695
LEGAL RESEARCH EXERCISES ON THE WEB 695
Chapter 34 Employment Discrimination 696
Title Vll of the Civil Rights Act of 1964 696
CASE 34.1 Arbaugh v.Y ＆ H Corp. 697
EXTENDED CASE 34.2 Burlington Northern and Santa Fe Railway Co.v.White 703
Discrimination Based on Age 705
CASE 34.3 Cash Distributing Co.v.Neely 707
Discrimination Based on Disability 710
Defenses to Employment Discrimination 712
Affirmative Action 713
State Laws Prohibiting Discrimination 715
REVIEWING：EMPLOYMENT DISCRIMINATION 715
TERMS AND CONCEPTS 716
QUESTIONS AND CASE PROBLEMS 716
SPECIAL CASE ANALYSIS：BURLINGTON NORTHERN AND SANTA FE RAILWAY CO.V.WHITE 718
LAW ON THE WEB 718
LEGAL RESEARCH EXERCISES ON THE WEB 719
FOCUS ON ETHICS：AGENCY AND EMPLOYMENT 720
UNIT8 Business Organizations 723
Chapter 35 Sole Proprietorships and Franchises 724
Sole Proprietorships 724
CASE 35.1 Garden City Boxing Club，Inc.v.Dominguez 725
Franchises 726
EXTENDED CASE 35.2 Kerl v.Dennis Rasmussen，Inc. 729
Franchise Termination 731
CASE 35.3 Chic Miller’s Chevrolet，Inc.v.General Motors Corp. 731
REVIEWING：SOLE PROPRIETORSHIPS AND FRANCHISES 733
TERMS AND CONCEPTS 733
QUESTIONS AND CASE PROBLEMS 734
LAW ON THE WEB 736
LEGAL RESEARCH EXERCISES ON THE WEB 736
Chapter 36 Partnerships and Limited Liability Partnerships 737
Basic Partnership Concepts 737
Partnership Formation 739
Partnership Operation 740
CASE 36.1 Moren v.Jax Restaurant 744
Dissociation of a Partner 746
CASE 36.2 Warnick v.Warnick 747
Partnership Termination 748
Limited Liability Partnerships 750
Limited Partnerships 751
EXTENDED CASE 36.3 In re Dissolution of Midnight Star Enterprises，L.P. 753
REVIEWING：PARTNERSHIPS AND LIMITED LIABILITY PARTNERSHIPS 755
TERMS AND CONCEPTS 756
QUESTIONS AND CASE PROBLEMS 756
LAW ON THE WEB 758
LEGAL RESEARCH EXERCISES ON THE WEB 758
Chapter 37 Limited Liability Companies and Special Business Forms 759
Limited Liability Companies 759
CASE 37.1 McFarland v.Virginia Retirement Services of Chesterfield，L.L.C. 760
CASE 37.2 Kuhn v.Tumminelli 763
Management of an LLC 764
Dissociation and Dissolution of an LLC 765
Special Business Forms 765
EXTENDED CASE 37.3 SPW Associates，LLP v.Anderson 766
REVIEWING：LIMITED LIABILITY COMPANIES AND SPECIAL BUSINESS FORMS 768
TERMS AND CONCEPTS 769
QUESTIONS AND CASE PROBLEMS 769
LAW ON THE WEB 772
LEGAL RESEARCH EXERCISES ON THE WEB 772
Chapter 38 CORPORATIONS—Formation and Financing 773
The Nature and Classification of Corporations 773
CASE 38.1 Commonwealth v.Angelo TodescaCorp. 775
EXTENDED CASE 38.2 Salt Lake Tribune Publishing Co.v.AT＆T Corp. 778
Corporate Formation 781
Defects in Formation and Corporate Status 785
Corporate Powers 786
Piercing the Corporate Veil 786
CASE 38.3 In re Aqua Clear Technologies，Inc. 787
Corporate Financing 789
REVIEWING：CORPORATIONS—FORMATION AND FINANCING 792
TERMS AND CONCEPTS 792
QUESTIONS AND CASE PROBLEMS 793
LAw ON THE WEB 795
LEGAL RESEARCH EXERCISES ON THE WEB 795
Chapter 39 CORPORATIONS—Directors，Officers，and Shareholders 796
Roles of Directors and Officers 796
EXTENDED CASE 39.1 Relational Investors，LLC v.Sovereign Bancorp，Inc. 797
Duties and Liabilities of Directors and Officers 801
CASE 39.2 Guth v.Loft，Inc. 803
The Role of Shareholders 805
Rights of Shareholders 809
Liability of Shareholders 812
CASE 39.3 Kaplan v.First Hartford Corp. 813
REVIEWING：CORPORATIONS—DIRECTORS，OFFICERS，AND SHAREHOLDERS 815
TERMS AND CONCEPTS 815
QUESTIONS AND CASE PROBLEMS 816
LAW ON THE WEB 818
LEGAL RESEARCH EXERCISES ON THE WEB 818
Chapter 40 CORPORATIONS—Merger，Consolidation，and Termination 819
Merger and Consolidation 819
CASE 40.1 Rodriguez v.Tech Credit Union Corp. 820
Purchase of Assets 823
Purchase of Stock 824
Termination 827
EXTENDED CASE 40.2 Parent v.Amity Autoworld，Ltd. 827
CASE 40.3 Sartori v.S ＆ S Trucking，Inc. 829
Major Business Forms Compared 830
REVIEWING：CORPORATIONS—MERGER，CONSOLIDATION，AND TERMINATION 833
TERMS AND CONCEPTS 833
QUESTIONS AND CASE.PROBLEMS 833
LAW ON THE WEB 835
LEGAL RESEARCH EXERCISES ON THE WEB 835
Chapter 41 CORPORATIONS—Securities Law and Corporate Governance 836
The Securities and Exchange Commission 836
The Securities Act of 1933 837
The Securities Exchange Act of 1934 845
CASE 41.1 SEC v.Texas Gulf Sulphur Co. 846
EXTENDED CASE 41.2 Merrill Lynch，Pierce，Fenner ＆ Smith，Inc.v.Dabit 847
CASE 41.3 United States v.Berger 851
Corporate Governance 853
State Securities Laws 855
Online Securities Fraud 857
REVIEWING：CORPORATIONS—SECURITIES LAW AND CORPORATE GOVERNANCE 858
TERMS AND CONCEPTS 859
QUESTIONS AND CASE PROBLEMS 859
SPECIAL CASE ANALYSIS：MERRILL LYNCH，PIERCE，FENNER ＆SMITH，INC. V. DOBIT 860
LAW ON THE WEB 861
LEGAL RESEARCH EXERCISES ON THE WEB 861
Chapter 42 Law for Small Business 862
The Importance of Legal Counsel 862
Selecting an Appropriate Business Form 863
The Limited Liability Company 866
EXTENDED CASE 42.1 Mixon v.Iberia Surgical，L.L.C. 867
Creating the Business Entity 868
Intellectual Property 869
Raising Financial Capital 871
CASE 42.2 InfoSAGE，Inc.v.Mellon Ventures，L.P. 872
Buy-Sell Agreements and Key-Person Insurance 873
Contract Law and Small Businesses 874
CASE 42.3 DBL Distributing，Inc.v.1 Cache，L.L.C. 875
Employment Issues 876
REVIEWING：LAN FOR SMALL BUSINESS 878
TERMS AND CONCEPTS 878
QUESTIONS AND CASE PROBLEMS 879
LAW ON THE WEB 881
LEGAL RESEARCH EXERCISES ON THE WEB 881
FOCUS ON ETHICS：BUSINESS ORGANIZATIONS 882
UNIT9 Government Regulation 885
Chapter 43 Administrative Law 886
The Practical Significance of Administrative Law 886
Agency Creation and Powers 887
The Administrative Procedure Act 888
EXTENDED CASE 43.1 FOx Television Stations，Inc.v.Federal Communications Commission 888
CASE 43.2 Hemp Industries Association v.Drug Enforcement Administration 892
Judicial Deference to Agency Decisions 894
CASE 43.3 United States v.Mead Corporation 895
Agency Enforcement and Adjudication 896
Limitations on Agency Powers 898
Public Accountability 900
REVIEWING：ADMINISTRATIVE LAW 901
TERMS AND CONCEPTS 901
QUESTIONS AND CASE PROBLEMS 902
LAW ON THE WEB 904
LEGAL RESEARCH EXERCISES ON THE WEB 904
Chapter 44 Consumer Law 905
Deceptive Advertising 905
EXTENDED CASE 44.1 Federal Trade Commission v.Verity International，Ltd. 907
Labeling and Packaging Laws 909
Sales 909
Credit Protection 910
CASE 44.2 Saunders v.Equifax Information Services，L.L.C. 912
Consumer Health and Safety 914
CASE 44.3 Abigail Alliance for Better Access to Developmental Drugs v.von Eschenbach 915
REVIEWING：CONSUMER LAW 917
TERMS AND CONCEPTS 918
QUESTIONS AND CASE PROBLEMS 918
LAW ON THE WEB 920
LEGAL RESEARCH EXERCISES ON THE WEB 920
Chapter 45 Environmental Law 921
Common Law Actions 921
Federal，State，and Local Regulation 922
Air Pollution 923
EXTENDED CASE 45.1 Environmental Defense v.Duke Energy Corp. 926
Water Pollution 928
CASE 45.2 S.D.Warren Co.v.Maine Board of Environmental Protection 928
Toxic Chemicals 931
CASE 45.3 Bates v.Dow Agrosciences，LLC 932
Hazardous Wastes 933
REVIEWING：ENVIRONMENTAL LAW 934
TERMS AND CONCEPTS 935
QUESTIONS AND CASE PROBLEMS 935
LAW ON THE WEB 937
LEGAL RESEARCH EXERCISES ON THE WEB 937
Chapter 46 Antitrust Law 938
The Sherman Antitrust Act 938
Section 1 of the Sherman Act 939
CASE 46.1 Continental T.V.，Inc.v.GTE Sylvania，In c. 941
EXTENDED CASE 46.2 Leegin Creative Leather Products，Inc.v.PSKS，Inc. 942
Section 2 of the Sherman Act 944
The Clayton Act 946
CASE 46.3 Illinois Tool Works，Inc.v.Independent Ink，Inc. 948
Enforcement of Antitrust Laws 950
Exemptions from Antitrust Law 951
U.S.Antitrust Laws in the Global Context 952
REVIEWING：ANTITRUST LAW 953
TERMS AND CONCEPTS 953
QUESTIONS AND CASE PROBLEMS 954
SPECIAL CASE ANALYSIS：LEEGIN CREATIVE LEATHER PRODUCTS，INC.V.PSKS，INC. 955
LAW ON THE WEB 956
LEGAL RESEARCH EXERCISES ON THE WEB 956
FOCUS ON ETHICS：GOVERNMENT REGULATION 957
UNIT10 Property 959
Chapter 47 Personal Property and Bailments 960
Personal Property versus Real Property 960
Fixtures 961
Acquiring Ownership of Personal Property 962
CASE 47.1 In re Estate of Piper 963
Mislaid，Lost，and Abandoned Property 965
EXTENDED CASE 47.2 United States v.One Hundred Sixty-Five Thousand Five Hundred Eighty Dollars（$165，580） in U.S.Currency 967
Bailments 969
Ordinary Bailments 970
Special Types of Bailments 973
CASE 47.3 Treiber ＆ Straub，Inc.v.United Parcel Service，Inc. 974
REVIEWING：PERSONAL PROPERTY AND BAILMENTS 977
TERMS AND CONCEPTS 977
QUESTIONS AND CASE PROBLEMS 977
LAW ON THE WEB 979
LEGAL RESEARCH EXERCISES ON THE WEB 979
Chapter 48 Real Property and Landlord-Tenant Relationships 980
The Nature of Real Property 980
Ownership and Other Interests in Real Property 981
CASE 48.1 Biglane v.Under the Hill Corp. 982
Transfer of Ownership 986
CASE 48.2 Whitehead v.Humphrey 989
CASE 48.3 Otwell v.Diversified Timber Services，Inc. 993
Limitations on the Rights of Property Owners 994
EXTENDED CASE 48.4 Kelo v.City of New London，Connecticut 995
Landlord-Tenant Relationships 997
REVIEWING：REAL PROPERTY AND LANDLORD-TENANT RELATIONSHIPS 1000
TERMS AND CONCEPTS 1000
QUESTIONS AND CASE PROBLEMS 1001
SPECIAL CASE ANALYSIS：KELO V. CITY OF NEW LONDON，CONNECTICUT 1002
LAW ON THE WEB 1003
LEGAL RESEARCH EXERCISES ON THE WEB 1003
FOCUS ON ETHICS：PROPERTY 1004
UNIT11 Special Topics 1007
Chapter 49 Insurance 1008Insurance Terminology and Concepts 1008
EXTENDED CASE 49.1 Zurich American Insurance Co.v.AMB Industries，Inc. 1011
The Insurance Contract 1012
CASE 49.2 Cary v.United of Omaha Life Insurance Co. 1015
CASE 49.3 Woo v.Fireman’s Fund Insurance Co. 1017
Types of Insurance 1018
REVIEWING：INSURANCE 1023
TERMS AND CONCEPTS 1023
QUESTIONS AND CASE PROBLEMS 1023
LAW ON THE WEB 1026
LEGAL RESEARCH EXERCISES ON THE WEB 1026
Chapter 50 Wills and Trusts 1027
Wills 1027
CASE 50.1 Shaw Family Archives，Ltd.v.CMG Worldwide，Inc. 1029
CASE 50.2 In re Estate of Pallister 1032
Intestacy Laws 1035
Trusts 1037
EXTENDED CASE 50.3 Cinquemani v.Lazio 1039
Other Estate-Planning Issues 1043
REVIEWING：WILLS AND TRUSTS 1044
TERMS AND CONCEPTS 1044
QUESTIONS AND CASE PROBLEMS 1045
LAW ON THE WEB 1047
LEGAL RESEARCH EXERCISES ON THE WEB 1047
Chapter 51 Professional Liability and Accountability 1048
Potential Liability to Clients 1048
EXTENDED CASE 51.1 In re Disciplinary Proceedings Against Inglimo 1050
Potential Liability to Third Parties 1052
CASE 51.2 Reznor v.J. Artist Management，Inc. 1053
The Sarbanes-Oxley Act of 2002 1055
Potential Liability of Accountants under Securities Laws 1058
Potential Criminal Liability of Accountants 1061
Confidentiality and Privilege 1062
REVIEWING：PROFESSIONAL LIABILITY AND ACCOUNTABILITY 1063
TERMS AND CONCEPTS 1064
QUESTIONS AND CASE PROBLEMS 1064
LAW ON THE WEB 1067
LEGAL RESEARCH EXERCISES ON THE WEB 1067
Chapter 52 International Law in a Global Economy 1068
International Law 1068
Doing Business Internationally 1071
Regulation of Specific Business Activities 1072
CASE 52.1 Fuji Photo Film Co.v.International Trade Commission 1073
U.S.Laws in a Global Context 1076
CASE 52.2 Carnero v.Boston Scientific Corp. 1076
EXTENDED 52.3 Khulumani v.Barclay National Bank，Ltd. 1078
REVIEWING：INTERNATIONAL LAW IN A GLOBAL ECONOMY 1080
TERMS AND CONCEPTS 1080
QUESTIONS AND CASE PROBLEMS 1080
SPECIAL CASE ANALYSIS：KHULUMANI V. BARCLAY NATIONAL BANK，LTD. 1082
LAW ON THE WEB 1082
LEGAL RESEARCH EXERCISES ON THE WEB 1082
FOCUS ON ETHICS：SPECIAL TOPICS 1083
Appendices 1087
Appendix A How to Brief Cases and Analyze Case Problems 1087
Appendix B The Constitution of the United States 1090
Appendix C The Uniform Commercial Code 1098
Appendix D The United Nations Convention on Contracts for the International Sale of Goods（Excerpts） 1262
Appendix E The Uniform Partnership Act（Excerpts） 1266
Appendix F The Revised Uniform Limited Partnership Act（Excerpts） 1276
Appendix G The Revised Model Business Corporation Act（Excerpts） 1286
Appendix H The Sarbanes-Oxley Act of 2002（Excerpts and Explanatory Comments） 1296
Appendix I Sample Answers for End-of-Chapter Questions with Sample Answer 1304
Glossary 1317
Table of Cases 1355
Index 1367