Business Law and Ethics

Units

1. 1

   The legal system and courts

   4 lessons

   1. Sources of lawName the four sources of law (constitutions, statutes, administrative regulations and common law), rank them as a pyramid of authority, and use the ranking to say which rule wins when two of them conflict.
   2. Federal and state courtsTrace the state and federal court ladders, decide whether a business dispute belongs in federal or state court using subject matter jurisdiction, and follow a case through its appeals.
   3. Civil litigation procedureWalk through a civil lawsuit from complaint to appeal, say what each stage does, and state the burden of proof that applies in a civil case compared with a criminal one.
   4. Arbitration, mediation and negotiationCompare negotiation, mediation, arbitration and litigation on cost, speed and control, and explain why many contracts contain an arbitration clause.
2. 2

   Torts and product liability

   4 lessons

   1. Intentional tortsState the elements of battery, defamation, fraud and interference with contract, name the main defense to each, and apply them to a short business fact pattern.
   2. NegligenceState the four elements of negligence (duty, breach, causation and damages), apply the reasonable person standard and the cost-benefit test for breach, and compute the effect of comparative fault on recovery.
   3. Strict product liabilityExplain strict liability for defective products, distinguish manufacturing, design and warning defects, trace liability along the supply chain, and state the warranty claims a buyer may bring against a seller.
   4. Vicarious liability and damagesApply respondeat superior to decide when an employer answers for an employee's tort, tell compensatory from punitive damages, and compare risk-management choices by their expected cost.
3. 3

   Contract formation

   4 lessons

   1. Offer and acceptanceDecide whether a contract has been formed by testing whether there is a valid offer, whether it is still open, and whether the reply is an acceptance under the mirror image rule.
   2. Consideration and promisesDecide whether a promise is supported by consideration, a bargained for exchange, and name the two cases where a court may still act: past consideration, which fails, and promissory estoppel, which can rescue a promise.
   3. Capacity and legalityTest whether each party has capacity and the purpose is lawful, and sort a flawed agreement as void, voidable or unenforceable, including contracts with minors, mental incapacity, illegal subject matter and unconscionable terms.
   4. Writing and the statute of fraudsLists contracts that must be in writing and the parol evidence rule, drawn as a flowchart of contract formation from agreement to enforceable written contract.
4. 4

   Defenses, breach and remedies

   4 lessons

   1. Defenses to enforcementExplains mistake, misrepresentation, duress, undue influence and fraud, shown as a decision tree from a claim to which defenses make a contract voidable. Remedies include rescission of the agreement.
   2. Interpretation and third partiesCovers contract interpretation, assignment, delegation and third party beneficiaries, drawn as a diagram of promisor, promisee and a third party with rights flowing. Plain meaning and trade custom guide a court reading the terms.
   3. Performance and breachDistinguishes material from minor breach, anticipatory repudiation and discharge, drawn as a timeline of performance with the points where breach excuses the other side. Each outcome decides whether the other party must still perform.
   4. Damages and equitable remediesComputes expectation, reliance and restitution damages and specific performance with mitigation, shown as a bar diagram of the gap between promised and actual position. A nonbreaching party must reasonably limit its losses.
5. 5

   Sales, agency and employment

   4 lessons

   1. UCC Article 2 salesApplies the UCC to sales of goods, merchants, the battle of the forms and risk of loss, drawn as a comparison table of common law versus UCC rules for a sample deal.
   2. Warranties and remedies in salesCovers express and implied warranties, disclaimers and buyer and seller remedies, shown as a layered diagram of warranty types and what each promises. Remedies include rejection, revocation and damages for the buyer.
   3. Agency relationshipsExplains principal and agent duties, actual and apparent authority, and liability, drawn as a triangle of principal, agent and third party with arrows of authority.
   4. Employment lawCovers at will employment, discrimination, wage and hour rules and workplace safety, drawn as a flowchart of an employment decision tested against protected classes. Each rule is applied to a hiring or firing scenario.
6. 6

   Business organizations and credit

   4 lessons

   1. Sole proprietorships and partnershipsCompares liability, taxes and control in proprietorships, general and limited partnerships, shown as a table of forms with liability and tax columns. Partners share unlimited personal liability in a general partnership.
   2. LLCs and corporationsCovers formation, limited liability, piercing the corporate veil and taxation, drawn as a diagram of owners, a shield around the entity and creditors. Double taxation of corporations is contrasted with pass through taxes.
   3. Corporate governance and dutiesExplains the roles of shareholders, directors and officers, fiduciary duties and the business judgment rule, shown as a governance chart with duties on each link.
   4. Secured creditExplains collateral, attachment and perfection under UCC Article 9 and priority, drawn as a priority ladder of creditors with a secured lender first. Perfection by filing gives public notice to other lenders.
7. 7

   Bankruptcy, securities and IP

   4 lessons

   1. Bankruptcy: Chapter 7 and 11Compares liquidation and reorganization, the automatic stay and discharge, drawn as a flowchart from filing through creditor claims to discharge or a reorganization plan. Secured creditors are paid before unsecured creditors.
   2. Securities regulationCovers the 1933 and 1934 Acts, registration, insider trading and Rule 10b-5, drawn as a timeline of a public offering with disclosure obligations at each step.
   3. Patents, copyrights and trademarksCompares the three intellectual property regimes, their duration and infringement, shown as a table of right, protected subject, term and a sample dispute. Remedies include injunctions and damages for infringement.
   4. Trade secrets, data and privacy lawCovers trade secrets, nondisclosure agreements, consumer data privacy laws and breach duties, drawn as a data flow diagram of collection, storage and sharing with legal checkpoints.
8. 8

   Ethics and corporate responsibility

   4 lessons

   1. Utilitarianism, duty and virtueApplies consequentialist, deontological and virtue theories to a dilemma, drawn as a three column table showing each theory's question and verdict on one case. It first shows an act can be legal yet unethical.
   2. An ethical decision processTeaches a stepwise method of facts, stakeholders, options, tests and action, drawn as a flowchart with a stakeholder map of who gains and who bears cost.
   3. Stakeholders, CSR and ESGContrasts shareholder and stakeholder views, the triple bottom line and ESG reporting, drawn as a stakeholder map with the firm at center and obligations on each arrow.
   4. Whistle-blowing and confidentialityWeighs loyalty against public interest, legal protections and reporting channels, drawn as a decision flowchart from discovering wrongdoing to internal and external reporting. Retaliation protections under statute are covered.