Entrepreneurship: Chapter 10

CHAPTER 10: THE LEGAL ENVIRONMENT

• Name the laws and regulations that affect small business
• Laws and regulations exist to protect competition, consumers, people in the workplace, and intellectual property; to allow bankruptcy; and to establish contracts.
• Specific laws that owners of small businesses should know include the Fair Labor Standards Act, the Civil Rights Act of 1964 and 1991, the Immigration Reform and Control Act, the Americans with Disabilities Act, workers' and unemployment compensation, and Occupational Safety and Health Act.

• List and explain the types of bankruptcy
• The U.S. brankruptcy code is made up of nine chapters, only three of which apply to most small businesses (chapter 7, 11, 13).
• Chapter 7 use liquidation meaning that the business ceases to exist in an effort to provide the debtor with a fresh start. Liquidation involves selling all of the business assets and nonexempt personal assets and then distributing the proceeds among creditors.
• Chapter 11 and 13 allow the business owner to file a reorganization plan with the court that offers protection from creditors until the debt is satisfied.

• Descibe the elements of a contract
• For a contract to be legally binding. It must have a legal purpose.  Both parties must come to an agreement including a legitimate offer and a legitimate acceptance of that offer. Consideration, or something of value, must be exchanged. Finally, all parties must have the capacity to enter into a binding contract, meaning that they must not be underage, intoxicated or of diminished mental ability.

• Discuss how to protect intellectual property
• Patents, copyrights, and trademarks are legal ways to protect intellectual property.
• A patent grants an inventors the exclusive right to make, use, and sell an invention for a period of 17 years.
• A copyright provides legal protection against infringement of an author's literary, musical, or artistic works.  Copyrights usually last for the author's life plus 50 years.
• A trademark is a legally protected name, term, symbol, design, or combination of these elements used to identify products or components. Trademarks last for as long as they are in use.

• My View: I am glad to learn more about the differences between copyright versus trademarks.  Trademarks protects any symbol that indicates the source or origi of the goods or services. For example, Starbucks protects its trademark logo by suing another China local franchise to misled consumer with almost identical logo. Consumers may make purchasing decision based on the logo reputation.Copyrights protects the specific creative expression of an idea. For example, painting, photographs, sculpture, writings, software, etc.