general jurisdiction
gives a court jurisdiction over a defendant for all act and omissions occurring in the state.
This typically occurs when one is a resident of the state.
Specific jurisdiction
Long arm statutes: give courts jurisdiction over defendants in other states based upon activities taking place in the state
This gives a court specific jurisdiction over a defendant if s/he meets such "minimum contacts" related to some act or omission mak
Long arm statutes
give courts jurisdiction over defendants in other states based upon activities taking place in the state
Corporate general jurisdiction
jurisdiction is proper in a corporation's principal place of business or place of incorporation
Corporate specific jurisdiction
minimum contacts" test
Usually met if a company advertises and sells its products in the state
before a party brings a lawsuit the party must have a _________
standing to sue
standing to sue
refers to some sort of injury suffered by the plaintiff, harm, causation, remedy
Negotiation
settling disputes without third party help
Mediation
nonbinding help from a third party who attempts to find middle ground
Arbitration
courts have very limited ability to review an award. The arbitrator acted in bad faith, the award violates a known public policy, the arbitrator exceeded his authority, going beyond what the parties agreed to arbitrate
intellectual property
any property that results from intellectual, creative processes
copyrights
protect literary or artistic production
give protection to authors for 70 years plus the life of the author
Generally copyright owners are protected against:
reproduction of the work
development of derivative works
distribution of the work
public display of the work
what does copyright not protect
ideas. One can reproduce the underlying idea of a work, it's the actual expression which is protected
Fair use exception
one can reproduce a work without paying royalties if the reproduction is considered "fair use
First sale doctrine
One who purchases a copyrighted good is allowed to sell, give away or transfer it to anyone else, regardless of the copyright holder's wishes. In other words, a copyright owner may no longer control the distribution of their good once its sold.
trademark
a distinctive mark, motto, device, or implement that a manufacturer stamps, prints, or otherwise affixes to the goods it produces so that they can be identified on the market
patent
a grant from the government that gives an inventor the exclusive right to make, use, or sell his or her invention for a period of twenty years
Agent agrees to represent or act for the other call the
principal
The principal has the right to control the _____ in specific matters
agent
Employees are generally considered _______ because they can bind their employers
agents
not employees and typically do not control the way in which an independent contractor performs their job
independent contractor
tort liability
employer's are generally responsible for torts committed by employees during the scope of their employment. But not contractors
Copyright owner
contractors retain the copyright on goods producers, whereas employers received the copyrights for items produced by employees
Agency by agreement
most agency relationships are the product of contract, a relationship can be implied by conduct
agency by ratification
if one approves or affirms a contract or other transaction made on their behalf by a non-agent, that person ratifies the transaction
Agency by operation of law
in some areas, the law declares people to be agents
agent liability
an agent is liable for damages arising from breaching one's duties
principal's duties
compensation, indemnification (to legally protect an agent in the case they are sued for acts arising out of their fiduciary relationship) cooperation
A limited liability partnership is
a partnership created under a state statute
LLps enjoy
pass through taxation (meaning that the partners of the LLP are taxed for their profits, but the LLP itself is not also taxes), LLp's have limited liability meaning that one may only sue the Partner committing the wrongful act, but not the other partners
partnership
arises from an agreement, express or implied, between two o more persons to carry on a business for a profit
each parter is deemed to be an agent of the other
Partnerships are considered aggregates of its members this a partner is taxed
regularly for their profits
A partnership is a
pass through entity, meaning that it does not pay a separate corporate tax
partnership agreement
articles of partnership and can include almost any terms the parties want
Rights of Partners
unless otherwise specified, all partners have equal rights to manage, each partner has one vote in management matters regardless of the size of their interest
Majority rules unless it is a significant decision. Then the partners must vote unanimously
Matt
Duty of care
must refrain in "grossly negligent or reckless conduct, intentional misconduct, or a knowing violation of the law
Duty of loyalty
must not compete with the partnership, must not misuse partnership property, disclosing trade secrets, or usurping a praetorship business opportunity, may not be waived in a partnership agreement
liability
partners are personally liable for the debts of the partnership, liability is essentially unlimited. A third party may sue Partner A for the acts of Partner B
Buy-Sell Agreement
an agreement determining how assets will be distributed upon a partnership's dissolution
limited liability company
a hybrid that combines the limited liability aspects of corporations and the tax advantages of a partnership
Due to how new they are, they are often legally treated as partnerships, sometimes, and other times, like corporations
Third parties must generally sue the
LLC and not the members thereof (for a tort of contract breach)
Piercing the corporate veil
occasionally a member can be sued personally if a court finds that the offending LLC was essentially the alter ego of the person, who wrongfully used the LLC vehicle
five nonexclusive factors
failure to follow statutory formalities
Under capitalization
Failure to use separate bank accounts
Failure to hold regular meetings
Comingling assets
LLCs are legal entities separate from their members
this means that LLCs have members not shareholders
LLC facts
citizen of the state in which it was formed and maintains its principal place of business
An LLC enjoys pass through taxation like a partnership
LLC's
either be "member managed or manager-managed" meaning that the owners of the LLC can run the company or they can use third party directors (managers)
corporate parlance - managers and member relationships
managers = board of directors, members = shareholders
piercing the corporate veil
one can sue a corporation's shareholders/directors personally if they use the corporate entity as essentially an alter ego, misusing the limited liability aspect of the corporation
owners of corporations are called
shareholders
shareholds
own shares (or 'stock'), which represents their ownership interest
the managers of a corporation
are the board of directors
Board of directors are elected by the
shareholders
a corporation must pay taxes on its
revenue, as well as the shareholders when the receive the profits. This produces double taxation
a corporation can be liable for the acts of its
officers
Piercing the corporation veil factors
a party is tricked into dealing with the corporation rather than the individual, the corporation is undercapitalized, never intended to earn a profit, corporation is formed to evade legal obligations, statutory formalities are ignored
publicly held corporation
stock of a public corporation can be purchased freely over public exchanges, such as the New York Stock Exchange or Nasdaq
privately held (or close) corporation
no public market. A person may sell their shares, but its much more difficult process
Nonprofit corporations
formed under an IRs code to promote a charitable objective, non profit corporations may not pay dividends on profits made. But may pay competitive salaries upfront
Benefit corporations
a for profit coroporation that also pursues some socially beneficial purpose
bonds
debt
a corporation borrows money and issues a bond to the lender stating the terms of repayment
Bonds are freely transferrable
Bonds have few other rights than the right to payment
Stock
Equity
ownership of the company
often have other rights, such as voting rights and the right to sue the corporation
directors
the ultimate authority in every corporation
Each has on vote and majority usually wins
the number is usually set forth in the articles of incorporation or bylaws
can be removed for "cause" by a shareholder vote
Directors conduct business by holding formal
Rights of directors
participation, inspection, indemnification
duty of care
act in good faith, exercise the care than na ordinarily prudent person would exercise in similar circumstances, act in the best interest of the corporation
duty to make informed decisions
directors and officers must be informed on corporate matters and conduct reasonable investigations. This requires meeting attendance, seek information, and review other relevant matters
the business judgement rule
the standard- directors and officers are expected to exercise due care and use their best judgement
Under this a corporate director or officer will not be liable to the corporation or shareholders for honest mistakes of judgement and bad business judgemen
the business judgement rule applies when the directors or officers
took reasonable steps to become informed on a matter, had a rational basis for their decision, did not have a conflict of interest with the underlying transaction
duty of loyalty
requires directors and officers to subordinate their person interests to the welfare of the corporation
directs cannot use corporate funds or confidential corporate information for
personal advantage and must refrain from self dealing
Typical problems: competing with the corporation, usurping a corporate opportunity, pursuing an interest that conflicts with that of the corporation, using information that is not available to the publ
conflict of interest
directors are forbidden from operating businesses that compete with their corporations, if a corporation enters into a contract in which the director has a personal interest, the director must make a full disclosure and must abstain from voting
Shareholder approval is required for certain substantial transactions
amend the articles of incorporation or bylaws, execute a merger or dissolve the corporation, sell substantially all of the corporation's assets, vote on the board of directors
corporation harmed by a third party
the directors can bring a suit on behalf of the corporation. if they fail to bring suit, the shareholders can "derivatively" bring a suit against the third party. Before shareholders can bring suit, they must make a written demand to the directors to brin