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PRDV205: Business Law and Legal Procedures

Unit 2: THE COURTS AND LITIGATION   A system of justice requires a process for justice.  In general, that process is available through the court system.  In this unit, you will learn about the basics of the American court system, which has its foundation in a network of trial courts that address disputes surrounding disagreements over facts and how the law applies to those facts.  If a party decides that the outcome of a trial is unsatisfactory, that party may decide to appeal the trial court's decision via an appeals court.  The American judicial system also provides for intermediate courts of appeal, state supreme courts, and one ultimate decider, the US Supreme Court.  A decision by a federal court of appeals or state supreme court may be appealed further to the US Supreme Court, but any legal issues decided by the Supreme Court may not be appealed further.  As a business professional, you will need to possess a working understanding of how this judicial process works and how the network of state and federal courts affects your work in the business world.

In general, legal problems between private parties can be addressed in two basic ways – through the courts or through less-formal legal alternatives.  In this unit, you will explore the process of litigation as well as other effective methods of handling conflicts.  These alternative methods are known as alternative dispute resolution, or ADR.  Going to court is usually an expensive and time-consuming prospect, and businesses are always looking for ways to more effectively manage costs and other resources.  As such, businesses attempt to conserve both money and other assets by first considering ways to resolve disputes other than formal legal processes.  For example, before going to court over the failure of a contractor to properly install equipment for a business, the business might first consider entering into informal negotiations with the installer in order to reach a conclusion that is satisfactory to both sides.  If this attempt fails, the business might propose the use of a mediator to reach a mutually beneficial result.  Often, business contracts contain a provision requiring issues to be submitted to arbitration that is run by a non-governmental official or an organization that acts, in essence, as a judge and jury in the matter.  If these efforts fail or it is apparent that ADR is unworkable from the beginning, then a business needs to consider whether a dispute is best resolved in a court, with all of a court’s formal requirements and protections.

In this unit, you will examine the process by which businesses litigate disputes.  You will consider who is involved in litigation and what procedural requirements must be met in order to successfully litigate a dispute.  You then will explore the various methods of ADR that are available to businesses, and consider how these methods may be used effectively to deal with disputes.

Unit 2 Time Advisory
This unit should take you approximately 2.5 hours to complete.

Unit2 Learning Outcomes
Upon successful completion of this unit, you should be able to: - identify the parts and functions of the US court system; - describe the legal process of discovery; - identify major pre-trial motions; - describe how a case proceeds through the court system; and - identify the major forms of alternative dispute resolution.

2.1 The American Court System   2.1.1 Jurisdiction   - Reading: The Legal and Ethical Environment of Business: “Chapter 2, Section 3: Trial and Appellate Courts” Link: The Legal and Ethical Environment of Business: “Chapter 2, Section 3: Trial and Appellate Courts” (PDF)

 Instructions: In Section 3 of Chapter 2, you will learn background
information about the jurisdiction of various courts in the United
States.  The US judicial system involves complex webs of
jurisdiction.  For example, some courts can hold trials, while other
courts may only hear appeals from earlier trial court decisions.  In
some situations, a case must be brought first to a state court; in
other situations, it must be brought directly to a federal court. 
In addition, some courts have broad jurisdiction, while others
possess only limited jurisdiction.  This textbook section will lay
out these basic differences in more detail.  

 Note that this reading also covers the material you need to know
for Subunit 2.1.2, found below.  You can refer to that subunit for
additional guidance on how to approach this reading.  

 Reading this textbook section should take approximately 30
minutes.  

 Terms of Use: This text was adapted by The Saylor Foundation under
a [Creative Commons Attribution-NonCommercial-ShareAlike 3.0
License](http://creativecommons.org/licenses/by-nc-sa/3.0/) without
attribution, as requested by the work’s original creator or
licensee.

2.1.2 Trial Courts   Note: This topic is covered by the Chapter 2, Section 3 textbook reading assigned under Subunit 2.1.1 (above).  For this subunit, focus on the textbook’s discussion of trial courts in the United States.  Note that at the federal level, trial courts are represented by district courts whose jurisdiction is limited by factors such as whether a federal law is involved, whether the parties are from different states, and (in the case of a civil trial) the amount of money involved.  In addition, all fifty states have their own court systems, with their own trial and appellate courts.  As you review this material, be sure to familiarize yourself with the limits and powers of various types of courts, as well as the types of interaction between state and federal courts.

2.1.3 Appeals Courts   - Reading: Foundations of Business Law and the Legal Environment: “Chapter 3, Section 5: Judgment, Appeal, and Execution” Link: Foundations of Business Law and the Legal Environment: “Chapter 3, Section 5: Judgment, Appeal, and Execution” (PDF)

 Instructions: Read Chapter 3, Section 5 of the textbook.  This
reading addresses the different possible outcomes of a trial as well
as the process of appealing a trial decision.  Note that appeals
(also called *appellate*) courts usually confine themselves to
examining whether any errors of law were committed in an earlier
trial.  As you read, familiarize yourself with the powers that
appeals courts can exercise when they consider cases that are on
appeal.  In addition, focus on understanding how power of contempt
orders can enforce court judgments.  

 Reading this textbook section should take approximately 15
minutes.  

 Terms of Use: This text was adapted by The Saylor Foundation under
a [Creative Commons Attribution-NonCommercial-ShareAlike 3.0
License](http://creativecommons.org/licenses/by-nc-sa/3.0/) without
attribution, as requested by the work’s original creator or
licensee.

2.2 Litigation   2.2.1 Initiating a Case   - Reading: The Legal and Ethical Environment of Business: “Chapter 3, Section 1: The Parties Involved” Link: The Legal and Ethical Environment of Business: “Chapter 3, Section 1: The Parties Involved” (PDF)

 Instructions: Read Chapter 3, Section 1 of the textbook. 
Litigation involves a court case in which one or more people or
groups (known as *parties*) bring a legal claim against another
party or parties for the purpose of deciding in favor of or against
the claim.  Note that several persons are key to the process of
litigation.  Be sure you understand the roles of litigants (usually
the plaintiff and the defendant), attorneys, and other key
professionals involved in the trial process.  

 Reading this textbook section should take approximately 30
minutes.  

 Terms of Use: This text was adapted by The Saylor Foundation under
a [Creative Commons Attribution-NonCommercial-ShareAlike 3.0
License](http://creativecommons.org/licenses/by-nc-sa/3.0/) without
attribution, as requested by the work’s original creator or
licensee.

2.2.2 Discovery   - Reading: The Legal and Ethical Environment of Business: “Chapter 3, Section 3: Pretrial Procedures” Link: The Legal and Ethical Environment of Business: “Chapter 3, Section 3: Pretrial Procedures” (PDF)

 Instructions: Read Chapter 3, Section 3 of the textbook. 
Litigation is a complex and time-consuming activity.  Before the
parties even get to trial, there is a great deal of preparation that
the parties must undertake before their day in court.  In this
reading, you will learn about the preparation of documents and the
exchange of information that are required in order to bring a
lawsuit.  You also will explore the concept of class-action lawsuits
and the legal process known as *discovery*.  

 Note that this reading also covers the material you need to know
for Subunit 2.2.3, found below. You can refer to that subunit for
additional guidance on how to approach this reading.  

 Reading this textbook section should take approximately 30
minutes.  

 Terms of Use: This text was adapted by The Saylor Foundation under
a [Creative Commons Attribution-NonCommercial-ShareAlike 3.0
License](http://creativecommons.org/licenses/by-nc-sa/3.0/) without
attribution, as requested by the work’s original creator or
licensee.

2.2.3 Pre-Trial Motions   Note: this topic is covered by the Chapter 3, Section 3 textbook reading assigned under Subunit 2.2.2 (above).  For this subunit, focus on reviewing the different bases on which a party may make a motion to dismiss a case in court.  Also review the role of affidavits in the submission of motions.

2.2.4 Trial and Appeal   - Reading: The Legal and Ethical Environment of Business: “Chapter 3, Section 4: The Trial and Appeal” Link: The Legal and Ethical Environment of Business: “Chapter 3, Section 4: The Trial and Appeal” (PDF)

 Instructions: Read Chapter 3, Section 4 of the textbook.  When
parties reach the trial stage of a lawsuit, important decisions must
be made about the selection of a jury, the opening and closing
statements, and the examination of witnesses.  In this reading, you
will gain an understanding of these processes, learn about the
burden of proof in civil litigation, and explore the process of
appeal that occurs when a party challenges the decision of a trial
court.  

 Reading this textbook section should take approximately 30
minutes.  

 Terms of Use: This text was adapted by The Saylor Foundation under
a [Creative Commons Attribution-NonCommercial-ShareAlike 3.0
License](http://creativecommons.org/licenses/by-nc-sa/3.0/) without
attribution, as requested by the work’s original creator or
licensee.

2.3 Alternative Dispute Resolution   - Reading: The Legal and Ethical Environment of Business: “Chapter 4, Introduction: Alternative Dispute Resolution” Link: The Legal and Ethical Environment of Business: “Chapter 4, Introduction: Alternative Dispute Resolution” (PDF)

 Instructions: Read the introductory section in Chapter 4 of the
textbook.  This reading will provide you with an overview of the
concept of *alternative dispute resolution*, or ADR.  

 Reading this textbook section should take approximately 15
minutes.  

 Terms of Use: This text was adapted by The Saylor Foundation under
a [Creative Commons Attribution-NonCommercial-ShareAlike 3.0
License](http://creativecommons.org/licenses/by-nc-sa/3.0/) without
attribution, as requested by the work’s original creator or
licensee.