Chapter 4 Constitutional Law for Business and E-Commerce

Constitution of the United States of America Federalism and delegated powers The U.S. form of government is federalism Federal government and state governments share powers Enumerated powers – delegated to the federal government by the states Powers not delegated to the federal government by the Constitution are reserved to the states 4-2 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Constitution of the United States of America Doctrine of separation of powers Article I – Legislative branch Article II – Executive branch Article III – Judicial branch Checks and balances Built to ensure no one branch of the federal government becomes too powerful 4-3 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Supremacy Clause Establishes that the federal Constitution, treaties, federal laws, and federal regulations are the supreme law of the land State and local laws that conflict with valid federal law are unconstitutional 4-4 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Supremacy Clause Preemption Doctrine: The concept that federal law takes precedence over state or local law Congress may expressly provide that federal statute exclusively regulates an area or activity Federal, state, and local governments can be given concurrent power 4-5 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Case 4.1: U.S. Supreme Court Supremacy Clause Bruesewitz v. Wyeth LLC 131 S.Ct. 1068, 179 L.Ed.2d 1, Web 2011 U.S. Lexis 1085 (2011) Supreme Court of the United States Issue Does the preemption provision in the federal NCVIA bar state law design-defect product liability claims against vaccine manufacturers? 4-6 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Commerce Clause Grants Congress the power “to regulate commerce with foreign nations, and among the several states, and with Indian tribes” Federal government has the power to regulate three types of commerce Commerce with Native American tribes Foreign commerce Interstate commerce 4-7 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Commerce Clause Dormant Commerce Clause If the federal government has chosen not to regulate an area of interstate commerce that it has the power to regulate, the area is subject to the Dormant Commerce Clause A state can enact laws to regulate that area of commerce The regulation should not unduly burden interstate commerce 4-8 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

E-Commerce and the Constitution Electronic commerce (e-commerce) Parties are permitted to obtain website domain names and conduct business electronically E-commerce can be used for Sales of goods Licensing of intellectual property Sales of services 4-9 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Bill of Rights and Other Amendments to the U.S. Constitution First ten amendments to the U.S. Constitution Guarantees certain fundamental rights to natural persons Protects persons from intrusive government action By federal government By state governments (Incorporation doctrine) 4-10 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Freedom of Speech The right to engage in oral, written, and symbolic speech Fully protected speech Limited protected speech Unprotected speech 4-11 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Freedom of Speech Fully protected speech Cannot be regulated or prohibited by government Can be oral, written, or symbolic Example – criticizing the President, burning the U.S. flag as protest 4-12 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Case 4.2: U.S. Supreme Court Free Speech and Violent Video Games Brown, Governor of California v. Entertainment Merchants Association 131 S.Ct. 2729, 180 L.Ed.2d 708, Web 2011 U.S. Lexis 4802 (2011) Supreme Court of the United States Issue Does the California act that restricts violent video games violate the First Amendment? 4-13 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Freedom of Speech Limited protected speech: Speech subject to time, place, and manner restrictions Offensive speech Commercial speech Unprotected Speech: Speech not protected by the First Amendment and may be forbidden totally 4-14 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Case 4.3: U.S. Supreme Court Free Speech Snyder v. Phelps 131 S.Ct. 1207, 179 L.Ed.2d 172, Web 2011 U.S. Lexis 1903 (2011) Supreme Court of the United States Issue Does the Free Speech Clause of the First Amendment shield church members from tort liability for their funeral picketing speech? 4-15 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Freedom of Religion The Establishment Clause: First Amendment clause prohibiting the government from either establishing a state religion or promoting one religion over another The Free Exercise Clause: First Amendment clause that prohibits the government from interfering with the free exercise of religion 4-16 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Equal Protection Equal Protection Clause: A clause that provides that a state cannot “deny to any person within its jurisdiction the equal protection of the laws” Laws cannot classify and treat “similarly situated” persons differently Artificial persons, such as corporations, are also protected Does not make the classification of individuals unlawful 4-17 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Equal Protection Standards of review Strict scrutiny test: Applied to classifications based on: Suspect class (e.g., race) Fundamental rights (e.g., voting) Intermediate scrutiny test: Applied to classifications based on protected classes (e.g., gender) 4-18 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Equal Protection Rational basis test: Applied to classifications not involving a suspect or protected class Court will uphold government regulation so long as there is a justifiable reason for it Permits much of the government regulation of business 4-19 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Due Process Due Process Clause: No person shall be deprived of “life, liberty, or property” without due process of the law Fifth Amendment – federal government action Fourteenth Amendment – state and local government action The government is not prohibited from taking a person’s life, liberty, or property 4-20 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Due Process Substantive due process Requires laws to be clear, not overly broad in scope Tested using a reasonable person’s understanding of the law Laws failing the test are declared void for vagueness 4-21 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Due Process Procedural due process Requires the government to give a person proper notice and hearing before depriving that person of life, liberty, or property 4-22 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Privileges and Immunities Privileges and Immunities Clause Provides that “the Citizens of each State shall be entitled to all Privileges and Immunities of Citizens in the several states” Privileges or Immunities Clause Provides that “no State shall make or enforce any law that shall abridge the privileges or immunities of the citizens of the United States” 4-23 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Privileges and Immunities The clauses prohibit states from enacting laws that unduly discriminate in favor of their residents The clauses apply only to citizens They do not protect corporations or aliens 4-24 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. 4-25 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.