1. October 2013 Charles University Law Faculty © Peter Kolker 2013

2.  Peter Kolker – Attorney at Law, practicing in Washington, D.C., with the law firm of Zuckerman Spaeder, LLP  More than 45 Years’ experience with criminal and civil litigation, arbitration and mediation  Including trials, appeals, arbitration hearings, private mediations in the U.S. and some in Europe (Germany, Sweden, the U.K.)  Special Guest: U.S. Ambassador Norman Eisen, a law firm colleague, and then member of White House Staff of President Obama. Since 2011, Ambassador to C.R. 2013 Class I2

3. Purpose of the Class:  Provide information to future Czech Republic attorneys about U.S. legal system to improve commerce between U.S. and Czech Republic.  Understand basis for U.S. decision making, so it is more predictable to a Czech lawyer  Review measures taken in the U.S. to improve transparency and integrity of the judicial system  Will some of these measures be appropriate in the Czech Republic?  What are their “social costs” and are those acceptable in the C.R. ? 2013 – Class I3

4. How the Class will be Conducted:  Two weeks, one covering each subject  Class participation is encouraged; I will suggest questions and hope/expect you will participate. There are no “right answers”. Your participation and reasoning is what I am looking for.  Readings in English (about 5 – 10 pages for each class)  Class simulation of a dispute between Ford Motor Company and “Czech Tech”, an imaginary company.  Class will take sides: is litigation or arbitration preferred?  Final Paper for credit 2013 Class I4

5.  Why Should we Study These Topics ?  Your Future Careers May be Improved.  What are your career plans after graduating?  Becoming lawyers?  Government civil servants?  Judges?  Business people?  Will you have business dealings with the U.S. or with U. S. companies?  If there are disputes from these business arrangements, how might U.S. law affect your conduct in resolving them ? 2013 Class I5

6. 6 A. U.S. Dispute Resolution Methods  Fundamentals of U.S. Judicial System: how it works;  Why does this matter to a lawyer or business person in the Czech Republic?  Can U.S. laws affect people outside of the U.S. ?  How disputes are resolved in the U.S. – federal and state court systems; and out-of-court dispute resolution through arbitration and mediation  Advantages and disadvantages of each method: what would be best for a Czech business problem?  How the U.S. Court system operates  Alternatives to the Court System for Dispute Resolution

7.  Importance of Transparency and Anti- Corruption Measures  Corruption Affects Everyone and Is Harmful to business  WHY? - Business and markets want predictability and fairness  Ethical citizens and business people are at a disadvantage  Orderly resolution of disputes is harmed  Predictability of Outcomes is impaired  Examples? From the class 2013 Class I7

8. B. Transparency in Government, Corporations and Non-Government Organizations to assure fairness  What good is any dispute resolution system if corruption destroys fairness?  How does the U.S. system assure (or try to assure) fairness?  What measures can assure that the judges, arbitrators, mediators and public prosecutors perform their functions without improper influence?  What role is there for private citizens who become aware of corruption, and what legal procedures are available in the U.S. for exposing corruption or unfairness?  Should any of these be considered for the Czech Republic? 2013 Class I8

9. We will also discuss:  The role of a free press in exposing corruption  Is there some information the press should not publish?  Effect of social media  Leaking of government secrets to the Press: is it proper?  Should there be limits on election financing of candidates  The purpose of a “Freedom of Information Act” to bring transparency to decision making 2013 Class I9

10.  The role of the “Whistleblower” in revealing improper conduct within the government or for companies who contract with the government.  A powerful tool, but should it be encouraged as a way of reducing corruption? 2013 Class I10

11.  The role of an informant: why do we have informants in a legal system?  When is it acceptable, and when is it not?  The role of an informant in exposing corruption:  We will discuss a real case of official corruption exposed by an informant, which would not have come to light otherwise.  But, there are perils to encouraging informants.  What is the proper balance? 2013 Class I11

12. U.S. Ambassador Eisen – How can we improve the Rule of Law and assure ethical performance by business people, lawyers, judges and prosecutors.  Role of the Public, the Press and of Government Officials in achieving these goals.  Measures taken by President Obama to ensure transparency – that the public could know who was meeting with and trying to influence the President.  Laws restricting public officials from influencing the government after their public service.  The role of an “Inspector General” for agencies of the government 2013 Class I12

13. Let’s begin with understanding how disputes are resolved in the U.S.: Common types of disputes you will likely encounter A. Civil Disputes  What do we mean by “civil dispute”?  Dispute between companies or individuals 2013 Class I13

14. Common types of civil disputes:  Contracts : your company agrees with another to ship products but the products don’t arrive on time; or they are not as expected; or not enough of them. As a result, there is a claim of money lost.  Product Liability : the product you purchased explodes and causes injury.  Personal Injury : during a business trip to the U.S., you are injured in a car accident.  Illegal Agreements: To make the business more profitable, your company agrees to limit competition. 2013 Class I 14

15.  Intellectual property disputes:  Patents, trademarks and copyrights  Protection of your company’s distinct ideas and reputation is important and can lead to disputes  Apple’s iPhone vs. Samsung Galaxy Phone  Confidentiality of business data: what happens when an employee leaves one company to work for a competitor and takes confidential information with him. 2013 Class I15

16. Contract Dispute  Disagreement on interpretation of a contract  What did the contracting parties intend when they signed the contract?  Was the contract performed according to its requirements ?  Was payment made in the right amount when due?  Was there a defect in the product that becomes clear after delivery?  Does the contract chose a dispute-resolution method? 2013 Class I16

17.  Product Liability : the product you purchased explodes and causes injury 2013 Class I17

18. B. Criminal Cases – Affecting Fairness of the Judicial System C. Payment to a Government Official - to get or keep a contract with the government, a payment is made to a government official.  Could be a crime in the U.S. as well as in the C.R., if done for a U.S. company, even if the payment happened in the C.R.  Agreement on Prices or on Bids: setting a price among competitors – could be a crime in the U.S. as well as in the C. R. if done for a U.S. company, even if the agreement was made in the C.R., but affected US market. 2013 Class I18

19. If Czech business engages in commerce with a U.S. business, which law will apply if there is a dispute?  Could be either. But if U.S. laws apply, you need to know how will the U.S. dispute resolution system work.  Usually, through litigation in the U.S. Courts  Arbitration could also resolve a dispute  Mediation may be used in litigation or arbitration  We will discuss arbitration and mediation later;  Now, we focus on litigation in the U.S. 2013 Class I19

20. Let’s start with the U.S. Court System 2013 Class I20

21. Overview of the U.S. Legal System : What is a Federal System and Why does the US have it ?  A “federal” system:  U.S. Government (“federal” government)  50 state governments  Laws of both the federal and state governments can apply at the same time  Laws include:  Statutes (enacted laws)  Administrative rulings (agencies set detailed rules that apply the law)  Judicial interpretation and “precedent” 2013 Class I21

22.  An unusual feature of U.S. Law:  Judicial interpretation and precedent – what does it mean and how does it work?  Judicial interpretations of the statutes and regulations are important to provide consistency and predictability of outcome.  Judicial interpretations decide what the statutes and administrative rulings mean, and the courts’ decisions are binding precedent  A decision in one case will be followed in other, similar cases 2013 Class I22

23. Relation of Federal Laws to State Laws  Some areas are only for the Federal Government  Some areas are only for the States  Some are for both  Where there is a conflict, federal laws prevail  Where the federal courts disagree with the state courts, the federal courts prevail  Which court would a Czech business person select if he/she has a dispute in the U.S. ? 2013 Class I23

24. How are judges selected in the U.S.?  Judges are first practicing lawyers; there is not a separate career path for judges.  Federal judges are appointed for life.  State judges may be appointed or elected, for a term of years; then they must be re-appointed or re- elected  They campaign for office and sometimes for re- election  Effect on independence  State judges may return to private practice as lawyers or may serve as professional arbitrators and mediators and make more money. 2013 Class I24

25. Contrast to the Czech Legal System  Code of laws governs the conduct;  One system throughout the country  Court decisions in one case do not necessarily affect the outcome of the next case, even if similar although this is changing  Judges are selected for long terms and do not come from the group of practicing lawyers  They do not run for office; their incomes and future source of income is fixed The differences in the U.S. and Czech legal systems can make it difficult to decide how to resolve disputes. 2013 Class I25