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Business Law Final > Chapter 15 Critical Legal Questions > Flashcards

Chapter 15 Critical Legal Questions Flashcards

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1
Q

What legal theory governed consumer law from the 18th Century until the 20th Century?

A

Caveat Emptor

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2
Q

What does caveat emptor mean?

A

“let the buyer beware”

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3
Q

Is false advertising protected by the first amendment?

A

No.

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4
Q

What are five elements of common law remedy for fraudulent advertising?

A

(1) a material misrepresentation
(2) of a presently existing fact
(3) intentionally or negligently made
(4) justifiably relied on
(5) to the plaintiff’s detriment

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5
Q

What is sales puffery?

A

statements that can’t be considered fact

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6
Q

What does FTCA stand for?

A

Federal Trade Commission Act

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7
Q

What Federal law makes unfair competition and unfair or deceptive practices illegal?

A

the Federal Trade Commission Act

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8
Q

What must a practice have in order to be unfair or illegal?

A

the capacity or tendency to deceive

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9
Q

What doesn’t a practice have to have in order to be unfair or illegal?

A

there doesn’t need to be proof that it has deceived

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10
Q

Give 6 examples of illegal advertising:

A

(1) bait-and-switch tactics
(2) low-balling tactics
(3) misleading price and savings claims
(4) untrue product test reports
(5) endorsements by fake doctor
(6) misleading tv or pictorial advertising

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11
Q

Five FTC remedies:

A

(1) consent decree
(2) cease and desist order
(3) fines
(4) damages for person injured
(5) corrective advertising

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12
Q

What does FDA stand for?

A

Food and Drug Administration

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13
Q

What does the FDA do?

A

protects consumer from injury and fraud in the formulation, packaging, and advertisement of products

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14
Q

What kind of products does the FDA cover?

A

foods, drugs, cosmetics, and therapeutic devices

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15
Q

What started the FDA?

A

the Food and Drug Act

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16
Q

When was the FDA started?

A

1906

17
Q

What was the FDA a reaction of? (what novel?)

A

Upton Sinclair’s THE JUNGLE

18
Q

What does the Equal Credit Opportunity Act forbid?

A

discrimination in the granting of credit based on race, sex, marital status, age, national origin

19
Q

What is a warranty?

A

contract offered by manufacturer, accepted by purchaser

20
Q

what does the Uniform Commercial Code, Article 2, govern

A

contracts for the sale of goods

21
Q

What are two types of warranties under the Commercial Code?

A

(1) express

(2) implied

22
Q

What code governs contracts for the sale of goods?

A

The Uniform Commercial Code, Article 2

23
Q

How is an express warranty created under the Uniform Commercial Code?

A

any promise or description of the goods in writing.

24
Q

When does an implied warranty take effect?

A

automatically right with the sale of the product.

25
Q

What are two implied warranties?

A

(1) implied warranty of merchantability

(2) implied warranty of fitness for a particular purpose

26
Q

What provides the authority to make “uniform laws on the subject of bankruptcies?”

A

the Constitution

27
Q

Who has the authority to make uniform laws regarding bankruptcies?

A

congress

28
Q

Name 3 chapters of bankruptcy:

A

(1) Chapter 7- straight bankruptcy
(2) Chapter 11
(3) Chapter 13

29
Q

Filing chapter 11 bankruptcy means:

A

the business rides out temporary troubles and reschedules when the debts are owed.

30
Q

Filing chapter 13 bankruptcy means:

A

a person rides out temporary troubles and reschedules when the debts are owed.

31
Q

What are the four purposes of modern bankruptcy law?

A

(1) provide orderly method to get relief (consumers go through pre and post bankruptcy financial counseling
(2) to provide uniform method of accounting for a debtor’s assets
(3) to protect honest debtors from having creditors take ALL assets
(4) to protect the creditors from unseemly scramble for the assets of the bankrupt

32
Q

In regards to product liability, Strict Liability addresses what?

A

the fact that an injured person cannot claim any breach of contract if no contract was made.

33
Q

Can an injured person prove negligence when the “instrumentality” that caused the injury has been destroyed?

A

No.

34
Q

What is the second basis for product liability?

A

negligence.

Business Law Final (6 decks)

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