1. ©2001 West Legal Studies in Business. All Rights Reserved. 1 Chapter 5: Constitutional Law

2. ©2001 West Legal Studies in Business. All Rights Reserved. 2 HistoryHistory Before the Revolutionary War, the States wanted a confederation with weak national government and very limited powers. After the war, in 1787, States voted to amend Articles of Confederation and create a new, federal government that shared power with States.

3. ©2001 West Legal Studies in Business. All Rights Reserved. 3 §1: Constitutional Powers of the United States Government Constitution established a federal form of government with checks and balances among three branches: executive, legislative and judicial. National government has limited, enumerated powers delegated from States. See the “Vote-Smart” site.Vote-Smart

4. ©2001 West Legal Studies in Business. All Rights Reserved. 4 U.S. Commerce Clause Power to regulate interstate commerce defined in Gibbons v. Ogden (1824). Expansion to private businesses began with Wickard v. Fillburn (1942). Wickard v. Fillburn Today, Commerce Clause it authorizes the national government to regulate virtually any business enterprise, including internet. Limits: U.S. v. Lopez (1995), Alden v. Maine (1999).U.S. v. Lopez Alden v. Maine

5. ©2001 West Legal Studies in Business. All Rights Reserved. 5 State Commerce States possess inherent police powers to regulate health, safety, public order, morals and general welfare. State laws that substantially interfere with interstate commerce will be struck down. Raymond Motor v. Rice (1978).Raymond Motor v. Rice

6. ©2001 West Legal Studies in Business. All Rights Reserved. 6 U.S. Supremacy Clause Article VI of the states the U.S. Constitution is the “Supreme Law of the Land.” In case of direct conflict between state and federal law, state law is invalid. Congress can preempt states powers when it chooses to act exclusively. Taxing Powers (Emerging Trends: Taxing the Internet).Emerging Trends

7. ©2001 West Legal Studies in Business. All Rights Reserved. 7 § 2: Business and the Bill of Rights Bill of Rights are not absolute. Originally the Bill of Rights was a limit on the national government’s powers. During the early 1900’s, the Supreme Court applied the Bill of Rights to the States via the “due process” clause of the 14th amendment.

8. ©2001 West Legal Studies in Business. All Rights Reserved. 8 Free Speech A fundamental (some would say “natural”) right afforded highest protection by courts. Symbolic Speech. Texas v. Johnson (1989).Texas v. Johnson R.A.V. vs. City of St.Paul (1992).R.A.V. vs. City of St.Paul

9. ©2001 West Legal Studies in Business. All Rights Reserved. 9 Commercial Speech Advertising is protected speech. Restrictions must: –Implement substantial government interest; –Directly advance that interest; and –Go no further than necessary. –Case 5.1: Bad Frog Brewery v. NY State Liquor Authority (1998).Bad Frog Brewery

10. ©2001 West Legal Studies in Business. All Rights Reserved. 10 Corporate Political Speech Afforded significant protection by the first amendment, but not as much as the right of natural persons. First National v. Bellotti (1978).First National v. Bellotti Consolidated Edison v. Public Service Commission (1980).Consolidated Edison v. Public Service Commission

11. ©2001 West Legal Studies in Business. All Rights Reserved. 11 Unprotected Speech Certain types of speech are not protected by the first amendment: –Slander. –Pornography, Obscenity. –Fighting Words. What about “Hate Speech”? –Doe v. University of Michigan (1989).

12. ©2001 West Legal Studies in Business. All Rights Reserved. 12 Freedom of Religion First amendment many neither prohibit the “establishment” nor prohibit the “free exercise” of religion. The first amendment does not require complete “separation of church and state.” Mandates accommodation of all religions and forbids hostility toward any. –Zorach v. Clauson (1952).Zorach v. Clauson

13. ©2001 West Legal Studies in Business. All Rights Reserved. 13 Freedom of Religion First amendment guarantees the “free exercise” of religion. Employers must reasonably accommodate beliefs as long as the employee has “sincerely held” beliefs. Frazee v. Illinois (1989).Frazee v. Illinois

14. ©2001 West Legal Studies in Business. All Rights Reserved. 14 Self-IncriminationSelf-Incrimination Fifth amendment guarantees no person can be compelled to testify against himself in a criminal proceeding. Does not apply to corporations or partnerships. –Case 5.2: Verniero v. Beverly Hills Ltd (1998).Verniero v. Beverly Hills Ltd

15. ©2001 West Legal Studies in Business. All Rights Reserved. 15 Searches and Seizures Fourth amendment requires warrant with “probable cause”. Warrantless exceptions exist for “evanescent” evidence. Searches of Business: generally business inspectors must have a warrant. Marshall v. Barlow’s (1978).Marshall v. Barlow’s

16. ©2001 West Legal Studies in Business. All Rights Reserved. 16 §3: Other Constitutional Protections Privileges and Immunities Clause. –Citizens of all states have same privileges. Full Faith and Credit Clause. –Documents and judgments of a state are honored by another state. Due Process. Equal Protection. Privacy Rights.

17. ©2001 West Legal Studies in Business. All Rights Reserved. 17 Due Process 5 th and 14 th amendments provide “no person shall be deprived of life, liberty or property without due process of law.” Due Process includes both Procedural and Substantive issues.

18. ©2001 West Legal Studies in Business. All Rights Reserved. 18 Procedural Due Process Procedures depriving an individual of her rights must be fair and equitable. Constitution requires adequate notice and a fair and impartial hearing before a disinterested magistrate.

19. ©2001 West Legal Studies in Business. All Rights Reserved. 19 Substantive Due Process Focuses on the content or substance of legislation. Laws limiting fundamental rights (speech, privacy, religion) must have a “compelling state interest.” Laws limiting non-fundamental rights require only a “rational basis”.

20. ©2001 West Legal Studies in Business. All Rights Reserved. 20 Equal Protection “Strict Scrutiny” test. –Laws that affect the fundamental rights of similarly situated individuals in a different manner are subject to the “strict scrutiny” test. – Any “suspect class” (race, national origin) must serve a “compelling state interest” which includes remedying past discrimination.

21. ©2001 West Legal Studies in Business. All Rights Reserved. 21 Equal Protection Intermediate Scrutiny. –Applied to laws involving gender or legitimacy. –To be constitutional laws must be substantially related to important government objectives. –(Example: Illegitimate teenage pregnancy).

22. ©2001 West Legal Studies in Business. All Rights Reserved. 22 Equal Protection “Rational Basis” Test. –Applied to matters of economic or social welfare. –Laws will be constitutional if there is a rational basis relating to legitimate government interest. –Case 5.3: WHS Realty v. Morristown (1999).

23. ©2001 West Legal Studies in Business. All Rights Reserved. 23 PrivacyPrivacy Fundamental right not expressly found in the constitution, but derived from 1 st, 5 th and 14 th amendments. Laws and policies affecting privacy are subject to the compelling interest test.

24. ©2001 West Legal Studies in Business. All Rights Reserved. 24 Law on the Web Online Constitution at Cornell U.Online Constitution See the “Vote-Smart” site on federalism.Vote-Smart Federalist Society.com.Federalist Society.com ACLU.org.ACLU.org Official U.S. Supreme Court site.Official U.S. Supreme Court Legal Research Exercises on the Web

25. ©2001 West Legal Studies in Business. All Rights Reserved. 25 Emerging Issues: Taxing Cyberspace States sales tax-sufficient “nexus”? –Quill v. North Dakota (1992).Quill v. North Dakota Internet Tax Freedom Act. –http://www.house.gov/chriscox/nettax/lawsums.htmlhttp://www.house.gov/chriscox/nettax/lawsums.html Return