Dismiss Restraining Order by dwo12410

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									     [0](1): Lawsuits - Preliminary Injunction

• Complaint: plaintiff files lawsuit against defendant
   – Plaintiff may be an attorney general, regulatory agency (SEC), or private party
   – Defendant can file counterclaims against the plaintiff
• Preliminary Injunction (PI)
   – Plaintiff asks the court to block the actions of the defendant until trial
   – Court schedules a hearing which becomes a mini-trial on merits
   – PI will be granted if court finds that the plaintiff is “likely to succeed on merits”
       • And if the plaintiff would suffer “irreparable harm” otherwise
   – Temporary Restraining Order (TRO): Plaintiff can also request and the court
     can order an immediate temporary injunction blocking the defendant’s actions
     until the hearing on the preliminary injunction is held
• Settlement may occur after the Preliminary Injunction decision
   – Each side learns new information about likelihood of winning
     Wharton School: Government & Legal Environment of Business - BPUB 621 - Visiting Professor Martin K. Perry
                      [0](2): Lawsuits - Discovery

• Discovery
   – Internal documents relevant to the litigation
       • difficult to limit discovery - very intrusive
   – Expert reports by physicians, economists, accountants, engineers, etc.
   – Depositions: oral examination of parties and witnesses by lawyers for other side
       • disruptive for managers to be deposed
• Settlement may occur during Discovery
   – Settlement negotiations often occur during discovery
   – Documents reveal new information about likelihood of winning the case
      • if plaintiff finds “smoking gun” memos, he can demand a better settlement
   – Expert reports and depositions reveal information about likelihood of winning
      • expert reports and depositions are very costly

     Wharton School: Government & Legal Environment of Business - BPUB 621 - Visiting Professor Martin K. Perry
        [0](3): Lawsuits - Summary Judgment

• Motion for Summary Judgment made by Defendant
   – Defendant asks the court to dismiss the case because there is no genuine legal
     case against the defendant
   – Each side submits “briefs” with arguments for and against summary judgment
   – Court holds a hearing which becomes a mini-trial on the legal merits of the
     plaintiff’s case
   – But in making its decision, the court must view the facts in a light most
     favorable to the plaintiff
• Surviving a Motion for Summary Judgment
   – Until recently, courts rarely granted motions for summary judgment
   – But now, courts are using this method to dismiss weak or frivolous cases
   – Thus, surviving summary judgment is now the primary goal of plaintiffs


     Wharton School: Government & Legal Environment of Business - BPUB 621 - Visiting Professor Martin K. Perry
            [0](4): Lawsuits - Settlement or Trial
• If the Court grants Summary Judgment, the plaintiff can appeal
   – Reversal by an appeals court will result in a Remand to the trial court for a trial
   – Appeals are costly and result in considerable delay
• If the Court denies Summary Judgment, trial preparation begins
   – Defendant will be more serious about settlement
   – Plaintiff should consider settlement to avoid the cost of a trial
   – Court will encourage settlement by holding a pre-trial conference
• Settlement may occur immediately before trial
   –   Trials are very expensive and disruptive
   –   Trials before juries can produce unpredictable verdicts
   –   Attractive settlements can encourage other plaintiffs to bring lawsuits
   –   But if the jury awards large damages, plaintiff lawyers will find other plaintiffs


       Wharton School: Government & Legal Environment of Business - BPUB 621 - Visiting Professor Martin K. Perry
                        [0](5): Lawsuits - Appeals
• Plaintiff or Defendant can appeal from an adverse ruling of the court
• Appeals of Preliminary Injunctions or Temporary Restraining Orders
   – Appeals courts accept and decide these appeals very quickly because they often
     determine the outcome of the cases, such as mergers
• Appeals of Summary Judgment Decisions
   – Plaintiff will generally appeal the grant of Summary Judgment
   – Defendant will often appeal the denial of Summary Judgment
      • Appeal imposes more costs on the plaintiff and may induce a settlement
   – Affirming the denial of Summary Judgment may induce the defendant to settle
• Appeals of Full Trials and Judgments
   – Appeals courts can overturn the legal conclusions of the trial court, but are not
     suppose to review the factual determinations of the trial court
   – Supreme Courts only accept appeals which raise new or difficult legal issues
     Wharton School: Government & Legal Environment of Business - BPUB 621 - Visiting Professor Martin K. Perry
                      [0](6): Lawsuits - Remedies
• If plaintiff wins, there are a variety of remedies
• Money Damages: plaintiff is private party
   – Compensatory Damages: award to plaintiff to compensate for past harm
   – Punitive Damages: award to plaintiff to punish and deter the defendant
• Permanent Injunction: any type of plaintiff
   – Court order on the defendant to discontinue the actions harming the plaintiff
• Civil Fines: plaintiff is an attorney general and regulatory agency
   – Punish and deter, but fines can also be used to compensate private parties
• Criminal Penalties: plaintiff is an attorney general
   – Criminal fines to punish the defendant and deter others from similar conduct
   – Prison sentences to punish and deter


     Wharton School: Government & Legal Environment of Business - BPUB 621 - Visiting Professor Martin K. Perry
      [0](7): Class Action Lawsuits - Rule 23

• Rule 23 of the Federal Rules of Civil Procedure
   – Governs class action lawsuits where there may be a large class of plaintiffs and
     possibly a large class of defendants
   – Law firms compete to represent the plaintiff class
      • Courts have held auctions in which law firms bid to represent the class
• Key Criteria for “certification” of a class
   – Questions of law or fact are common to all the members of the class, and
     predominate over those questions for individual members of the class
   – Claims (for plaintiffs) and defenses (for defendants) of the particular parties
     representing the classes are typical of the claims of all members of the class
• Once a class is certified, the case in transferred to one Federal District
  Court for either a settlement or a trial
   – Settlements must be approved by the court
     Wharton School: Government & Legal Environment of Business - BPUB 621 - Visiting Professor Martin K. Perry
 [0](8): Constitutional Source of Federal Laws

• Article I, Section 8: The Congress shall have power
• Subsection [3]: To regulate commerce with foreign nations, and
  among the several states, and with the Indian tribes.
   – Securities Laws, Antitrust Laws, and Trade Laws
• Subsection [4]: To establish … uniform laws on the subject of
  bankruptcies throughout the United States.
   – Bankruptcy Laws
• Subsection [8]: To promote the progress of science and useful arts, by
  securing for limited times to authors and inventors the exclusive right
  to their respective writings and discoveries.
   – Intellectual Property: Patents and Copyrights


     Wharton School: Government & Legal Environment of Business - BPUB 621 - Visiting Professor Martin K. Perry
   [0](9): Constitutional Source of State Laws
• Tenth Amendment of the U.S. Constitution
   – The powers not delegated to the United States by the Constitution, nor
     prohibited by it to the States, are reserved to the States respectively, or to the
     people.
• State Common Law - English tradition
   – Property and Contract law: business law
   – Tort and Criminal law: civil and criminal duties which also apply to business
• General Incorporation Statutes
   – Incorporation was clearly reserved to the states
       • Not enumerated in Article I, Section 8 even though it was debated when the
         Constitution was being drafted
   – Delaware has become the primary state of incorporation for U.S. corporations
   – Delaware court decisions have defined corporate law in the U.S.

     Wharton School: Government & Legal Environment of Business - BPUB 621 - Visiting Professor Martin K. Perry

								
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