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Chapter 4 Business Law

Provisions of the Fifth and Fourteenth Amendments guarantee that no person shall be deprived of life, liberty, or property without due process of law and this clause applies to all “legal persons,” including:
. individuals and corporations.
Substantive Due Process
Limits What Government may do in its legislative and executive capacities legislation must be fair and reasonable
Procedural due process
The government must give a person proper notice and an opportunity to be heard so that the procedures are fair
A Kansas City law imposes prison terms without a trial on street entertainers who operate in certain areas. A court would likely review this statute under the principles of:
Procedural due process
Someone tells the dean of your college that he saw you cheating on an exam. The dean kicks you out of school. What type of due process has the dean probably violated?
Procedural due process
Your state legislature passes a law prohibiting students from criticizing actions taken by the governor. Does this new law further a legitimate government objective?
No, because no legislature can infringe on a person”s free speech rights.
The Fourteenth Amendment does NOT guarantee
Freedom of press
Gooding, Rhode Island, passes a law allowing only two street vendors to operate in a specific area for the purpose of reducing traffic. The court would likely review this ordinance under the principles of:
The equal protection clause
To determine whether a law violates the Equal Protection Clause, courts use one of three standards to “test” whether a person has been inhibited from exercising a fundamental right.
Intermediate scrutiny, Rational basis test, and Strict scrutiny
Most statutory rape laws apply to men, but not to women. Do these laws pass intermediate scrutiny?
c. Yes, because males and females are not similarly situated and the state has an interest in preventing illegal teenage pregnancies.
A law that provides unemployment benefits only to people over six feet tall will pass the rational basis test?
b. False
In which landmark 1965 case did the Supreme Court hold that a constitutional right of privacy is implied by the First, Third, Fourth, Fifth, and Ninth Amendments?
a. Griswold v. Connecticut
The ___________ greatly expanded the authority of government to monitor e-mails and Web site visits.
USA Patriot Act
First Amendment
Guarantees the freedoms of religion, speech, and the press and the right to assemble peaceably and to petition the government
Fourth Amendment
Prohibits unreasonable searches and seizures of persons or property
Ninth Amendment
Establishes that the person have rights in addition to those specified in the Constitution
As originally intended, the first ten amendments to the Constitution limited only the power of
The federal government
Whenever the language in the Bill of Rights describing a right is overly broad or unclear in a particular situation, what does NOT occur:
b. The individual state legislatures interpret the unclear language.
Symbolic speech is NOT covered by the Bill of Rights.
Your state passes a law prohibiting businesses from supporting political candidates. You go to court and challenge the law’s constitutionality. Will the law be upheld?
b. No, because the law is an unconstitutional restriction of free speech.
The compelling government interest test is used by the courts to determine whether a law regulating the content of speech will be permissible.
Free Exercise Clause
The provision in the First Amendment to the U.S. Constitution that prohibits Congress from making any law “prohibiting the free exercise” of religion
Establishment Clause
The provision in the First Amendment to the U.S. Constitution that prohibits Congress from creating any law “respecting an establishment of religion.
What type of powers do the states have to regulate or prohibit private activities?
b. Police powers
State police powers only authorize state police forces.
All powers expressly “reserved” to the states fall under the ______ amendment.
Which of the following would NOT be regulated at the state level?
Interstate commerce laws
Olga lives in New Jersey and wishes to obtain a business license in New York. New York passes a law requiring nonresidents to pay an additional $1,000 fee for anyone applying from New Jersey. Can New York “get away” with that?
No, because the Privileges and Immunities Clause would prohibit such a discrepancy in fees
Rights established under deeds, wills, and contracts in one state must be honored by other states.
Hint:What does the Full Faith and Credit Clause say?
Legislative Branch
Role:Makes the laws
Example of Checks & Balances: But the executive branch ( The president) has the constitutional authority to veto that law
Judicial Branch
Role: Interprets the laws
Example of Checks and Balances: Had the power to hold actions of the other two branches unconstitutional
Executive Branch
Role: Enforces the laws
Checks and balances: Responsible for foreign affairs: but treaties with foreign governments require the advice and consent of the senate.
Article 1, Section 8, of the U.S. Constitution impacts business greatly and is referred to as the .
Commerce Clause
State laws that allow the use of medical marijuana insulate users in those states from federal prosecution.
False: Correct. While lawsuits have argued that it is unconstitutional for the federal statute to prohibit marijuana use for medical purposes when it is legal within a state, the Supreme Court has held that Congress has the authority to prohibit the intrastate possession of marijuana as part of a larger regulatory scheme. See The Constitutional Powers of Government.
In 1824, the Supreme Court decided the landmark case ____________ , which ruled that commerce within the states could also be regulated by the national government.
Gibbons V. Ogden
When there is a direct conflict between a federal and a state law, the state law is rendered invalid.
hint: What does the Supremacy Clause in the U.S. Constitution say?
Congress sets out a medical-device approval process for the Food and Drug Administration. The law includes a preemption provision. A device that goes through the process injures Eric, who sues under state law to recover. The court will most likely rule that:
The federal law preempts Eric’s state law claim

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