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Business Law Chapter 2


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Define the term jurisdiction.
the types of cases a court can try.
Compare and contrast general jurisdiction with limited jurisdiction.
General jurisdiction means that a court can hear any type of case that falls within their venue. Limited jurisdiction means that a court can hear only certain types of cases.
Compare and contrast in personam jurisdiction with in rem jurisdiction.
in personam jurisdiction is where a court has jurisdiction based on upon the residence or activities of the person being sued. in rem jurisdiction is when a court has jurisdiction based upon the location of the property at issue in the lawsuit.
Explain how a state's long arm statute might work.
A long arm statute can subject an out of state defendent to jurisdiction in the state as long as due process requirements are met. The defendent must have certain minimum contacts with the state.
Compare and contrast original jurisdiction with appellate jurisdiction.
Original jurisdiction is the power of the U.S. Supreme Court to take cognizance of a case at its inception, try it, and pass judgement upon the law and facts. Appellate jurisdiction is the power of the Supreme Court and other courts of appeal to decide cases that have been tried in a lower court and appealed.
Identify the bases for federal court jurisdiction.
Three sources: 1. federal question jurisdiction- exists when the dispute concerns federal law, namely a legal right arising under the U.S. Constitution, a federal statute, etc. 2. diversity juridiction- exists when a lawsuit is between citizens of two different states and the amount in controversy exceeds 75,000. 3. when the United States is a party- when the U.S. government, or an officer or agency thereof, is a plaintiff or the defendent.
Explain how the courts might determine a natural person and a corporation's citizenship.
An individual is a citizen of the state where the person has his or her legal residence, or, if they have homes in one or more states, the state they consider home. A corporation is deemed a citizen of the state in which it has been incorporated and the state where the company has its principal place of business.
Compare and contrast exclusive jurisdiction with concurrent jurisdiction.
Exclusive jurisdiction is when only one court has jurisdiction over a certain type of case. Concurrent jurisdiction is when more than one court has jursidiction over a certain type of case.
Explain the Erie doctrine.
In this case, the court decided that a federal court must use state law in a case involving diversity jurisdiction, unless the lawsuit concerns the U.S. constitution or a federal statute. This prevents forum shopping.
Compare and contrast a choice of law provision with a choice of forum provision.
In a lawsuit involving citizens of different states, the law used is the law of the state with the greatest interests, or, if more than one state has an interest, the court can use different states' laws for different parts of the dispute.
Define standing.
a party to a lawsuit has standing if the person seeking relief is the proper party to advance the litigation, has a personal interest in the outcome of the suit, and will benefit from a favorable ruling.
Define venue.
the particular county or geographical area in which a court with jurisdiction may hear and determine a case.
Compare and contrast venue with jurisdiction.
If a court has jurisdiction, it means the court has the authority to hear that type of dispute. The venue is the court in a particular geographical area that can hear the case.
Explain the three-tiered state court system.
The lowest level are several courts of limited jurisdiction, that hear minor criminal matters, small civil suits, and other specialized legal disputes. The next level consists of courts of general jurisdiction. The third level are the state appellate courts that hear appeals from the lower level courts. The top level is the state supreme court.
Compare and contrast a trial court with an appellate court.
a trial court usually has general or unlimited jurisdiction, while and appellate court only hears appeals from the trial courts.
Explain the concept of stare decisis.
the doctrine that holds that once a court resolves a particular issue, other courts addressing a similar legal problem generally follow the initial court's decision.
Compare and contrast an authoritative decision with a persuasive decision using the concept of stare decisis.
A decision is persuasive if it reasonably and fairly resolves the dispute. Another court confronting a similar dispute will probably choose to apply the same reasoning. An authoritative decision, must be followed.
Explain the three-tiered federal court system.
The first level are the U.S. district courts. They are the trial courts of the federal system. The next level are the courts of appeals. There are also specialized federal courts that hear disputes about certain subject areas. The last tier is the U.S. Supreme Court.
Define writ of certiorari.
an order written by the U.S. Supreme Court when it decides to hear a case, ordering the lower court to certify the record of proceedings below and send it up to the U.S. Supreme Court.
Define the Federal Rules of Civil Procedure.
the procedural rules that govern civil litigation.
Define pleadings.
the formal allegations by the parties to a lawsuit of their respective claims and defenses.
Define service of process.
the summons that officially notifies the the defendent that a lawsuit is pending against it in a particular court and that it must file a response to the complaint within a certain number of days.
Define default judgement.
a judgement that may be entered in favor of the plaintiff if the defendent does not file an answer within the time required.
Explain an affirmative defense.
admits that the defendent has acted in a certain way but claims that the defendent's conduct was not the real or legal cause of harm to the plainiff or that the defendent's conduct is excused for some reason.
Compare and contrast a motion to dismiss with a motion for judgement on the pleadings.
A motion to dismiss seeks to terminate the lawsuit on the ground that the plaintiff's claim is technically inadequate. A motion for judgement on the pleadings is when one party argues that the complaint alone demonstrates that the action is futile.
Explain the function of a motion for summary judgement.
will be granted only if the evidence clearly establishes that there are no disputed issues of material fact and that the party who requested the summary judgement is entitled to recovery as a matter of law.
Compare and contrast a deposition with an interogatory.
Depositions are written or oral questions asked of any person who may have helpful information about the facts of the case, while interogatories are written questions to the parties in the case and their attorneys.
Explain the benefits of discovery.
Discovery helps everyone in the trial have all the facts. It also helps preserve evidence. It also reduces the number of legal issues to be presented at trial because the parties can see beforehand which claims they have evidence to support and which ones are not worth pursuing.
Explain the disadvantages of discovery.
Discovery is very labor intensive, and is very expensive. Can lead to discovery abuse.
Define voir dire.
the questioning of potential jurors.
Explain the trial process.
1. selection of the jury.
2. opening statements.
3. presentation of evidence and witnesses by the plaintiff's attorney.
4. presentation of evidence and witnesses by the defendant's attorney.
5. motion for a directed verdict.
6. closing arguments.
7. judges instructions to the jury.
8. jury deliberations.
9. announcement of the jury verdict.
Compare and contrast a motion for a new trial with a motion for judgement on the pleadings.
The motion for judgement on the pleadings precedes the trial while a motion for a new trial comes after the trial.
Explain the attorney client privilege and elaborate on the difficulties involved in maintaining the privilege with a corporate client.
The privilege provides that a court cannot force the disclosure of confidential communications between a client and his attorney. The difficulty in maintaining the privilege with a corporate client is deciding what exactly constitutes communication with the corporation.
Explain the attorney work product doctrine and how it differs from the attorney client privilege.
The attorney work-product doctrine protects information that an attorney prepares in the course of his or her work. This is different from attorney client privelege in that attorney client privilege belongs to the client, and the attorney work product belongs to the attorney.
Explain what companies might do for pretrial preparation.
The company should select an attorney first who has experience in the area being litigated. The company also needs to decide who will handle public relations so that confidential information will not be disclosed accidentally. Then management should tell employees not to destroy important information, and tell them not to discuss the lawsuit with anyone. They should also make a budget for the lawsuit.
Explain the function of a valid document retention program.
It helps protect a company in the event of litigation, and protects corporate privacy and trade secrets.
Define alternative dispute resolution.
using other means of solving a dispute other than litigation.
Compare and contrast negotiation with mediation.
Both negotiation and mediation are not binding, but negotiation is just between the two parties, while mediation uses a neutral third party.
Compare and contrast mediation with arbitration.
Both involve neutral third parties, but arbitration is binding, and mediation is not.
Define an arbitration clause.
a clause that specifies that in the event of a dispute arising out of a contract, the parties will arbitrate specific issues in a stated manner.

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