In a criminal case, a government official was convicted for providing false witness for a company in exchange for money. What sort of offense is this?
Bribery of a public official
Corporate bribery
Commercial bribery
Bribery for information
Bribery is the offering, giving, soliciting, or receiving of money or any object of value for the purpose of influencing the judgment or conduct of a person in a position of trust. Bribery of a public official is a statutory offense under federal law, which also covers bribes offered to witnesses in exchange for testimony.
Which of the following defines a Ponzi scheme?
Using fraudulent means to obtain information about someone’s phone use.
An entry in the books of a bank or corporation designed to represent funds that do not exist.
The misappropriation of trust funds or money held in fiduciary capacity.
An investment swindle where high profits are promised from fictitious sources.
An investment swindle in which high profits are promised from fictitious sources and early investors are paid off with funds raised from later ones.
Mr. Z shot and killed an armed robber who had his gun pointed at him. The robber died at the scene of the crime. What defense can Mr. Z use to get acquitted?
Justifiable use of force
Necessity
Duress
Entrapment
Although not typical in white-collar crime cases, one defense in cases of physical violence is justifiable use of force. The best-known example is self-defense in protection of your life.
Which of the following happens if the defendant is not informed of the Miranda Rights?
There can be no trial until the defendant is informed of them.
Any information a defendant offers at the time of arrest is inadmissible.
There can be no appeal after the verdict of the trial has been pronounced.
The arresting officers cannot bear witness.
To comply with the Supreme Court’s requirements for protecting a citizen’s rights, law enforcement officers must inform any individual they arrest of his or her Miranda rights. If the officers fail to do so, any information a defendant offers at the time of the arrest is not admissible at trial.
Which of the following comes under the RICO Act?
Employee suing employer for fraud against government.
Destruction of documents in a federal bankruptcy investigation.
Racketeering.
Willfully not maintaining audit records.
One of the most important tools for fighting white-collar crime is in Title IX of the Organized Crime Control Act of 1970: the Racketeer Influenced and Corrupt Organizations(RICO) Act. It was originally enacted to combat organized crime.
What is the primary objective of tort law?
To provide compensation for injured parties.
To obtain compensation for breach of duty to society.
To punish wrongdoers and preserve order in society.
To bring a lawsuit against the criminal by the state.
Tort law’s primary objective is to provide compensation for injured parties. Crime victims may be able to bring a tort action against a criminal because the same actions that constitute a criminal offense often constitute a tort.
Which of the following constitutes fraudulent misrepresentation?
The plaintiff suffered damages because of his reliance on a misrepresentation.
Someone enters an industry with the sole intent of driving another firm out of business.
The defendant maligned the plaintiff’s reputation by making derogatory statements.
The defendant intentionally undertook steps to cause a breach of contract.
Fraudulent misrepresentation occurs when a party uses intentional deceit to facilitate personal gain. Someone knowingly, or with reckless disregard for the truth, misrepresented material facts and conditions. The defendant intended to have other parties rely on the misrepresentations. The injured party reasonably relied on the misrepresentations. The injured party suffered damages because of this reliance. A direct link exists between the injuries suffered and a reliance on the misrepresentations.
In which of the following cases will punitive damages most likely be the highest?
Defendant is not wealthy and the act committed is moderately wrongful.
Defendant is not wealthy and the act committed is highly wrongful.
Defendant is wealthy and the act committed is moderately wrongful.
Defendant is wealthy and the act committed is highly wrongful.
The more wrongful the nature of the defendant, the greater the desire to send a message that such behavior will not be tolerated; and the greater the defendant’s wealth, the higher the damages must be in order to be significant.
Why was the Class Action Fairness Act (CAFA) of 2005 created?
To offer original jurisdiction to district courts on CAFA cases.
To limit the conditions under which a class action suit can be brought.
To make tort reform laws equal at state level.
To enhance damage awards.
The one successful piece of tort reform legislation at the national level is the Class Action Fairness Act (CAFA). The CAFA signed into law to limit the conditions under which class action suits can be brought, as opposed to limiting damage awards.
James was arguing on his mobile phone with a friend while driving on the street. His car hit a lady crossing the road. James got out of the car and rushed over to the victim. She was unconscious and bleeding. In this situation, James:
is not liable for damages caused by the accident.
has no legal duty since his action lacks intent.
is a perpetrator and should refrain from assisting the victim.
has a duty to remove the victim from further harm.
In some cases, however, the courts hold that individuals have a duty to aid strangers in certain types of peril. For example, if Sam negligently hits Janice with his car and, as a result, Janice is lying in the street, Sam has a duty to remove her from that dangerous position.
What is the third element needed to prove a case of negligence?
Doctrine
Causation
Damages
Breach of duty
Causation is the third element of a successful negligence claim, and it has two separate elements: actual cause and proximate cause. The plaintiff must prove both elements of causation to be able to recover damages.
What is the outcome if a defendant successfully proves contributory negligence?
The defendant has to pay half the damages asked for by the plaintiff.
The case will be declared void.
The plaintiff will pay a sum to the defendant for filing a case.
The plaintiff will be denied any recovery of damages.
If the defendant successfully proves contributory negligence, no matter how slight the plaintiff’s negligence, the plaintiff will be denied any recovery of damages.
Alan, a travelling salesman filed a negligence case against Mr. Measly. He was bitten by Mr. Measly’s pet snake while pressing the doorbell on the front porch. Alan had had no previous warning of the snake being loose. He filed for damages under _____.
strict liability
last clear chance doctrine
breach of duty
negligence per se
The law holds an individual liable without fault when the activity in which she engages satisfies three conditions: (1) It involves a risk of serious harm to people or property; (2) it is so inherently dangerous that it cannot ever be safely undertaken; and (3) it is not usually performed in the immediate community.
What is a balancing test used for in a product negligence case?
To consider the extent of damage done and the amount to be compensated.
To weigh the liability of the manufacturer and that of the consumer.
To compare the present damage to the possibility of future damage by the product.
To weigh the degree of danger to be avoided with the ease of warning.
Sometimes courts use a balancing test to determine negligence in such cases. They weigh the degree of danger to be avoided with the ease of warning.
Define statute of repose.
The compliance with federal laws is a defense to state tort law.
The time limit within which all types of civil actions may be brought.
A consumer knows that a defect exists but still proceeds unreasonably to make use of the product and thus cannot recover.
The barring of actions that arise more than a specified number of years after the product was purchased.
Statutes of repose provide an additional statutory defense by barring actions arising more than a specified number of years after the product was purchased. Statutes of repose are usually much longer than statutes of limitations, generally running at least 10 years.
Which theory can be used if a plaintiff cannot trace the manufacturer of the defective product due to lapse of time between purchasing the product and occurrence of damages?
Market share theory
Assumption of risk
Negligence
Breach of warranty
Sometimes, however, some plaintiffs may not learn of their injuries until years after the injury occurs. By this time, plaintiffs cannot trace the product to any particular manufacturer. Often, a number of manufacturers produced the same product, and the plaintiff would have no idea whose product had been used. A plaintiff may have even used more than one manufacturer’s product. In this case, market share liability can be used.
Why do start-up companies often have difficulty obtaining product liability insurance?
They cannot afford high premiums.
They do not have credibility in the market.
They fail to meet the standards set by insurance companies.
They do not receive government approval for insuring.
Start-up companies often have difficulty obtaining product liability insurance because they frequently cannot meet the insurance company’s requirements, such as sales totaling a certain amount per year.
An accountant can be held liable for negligence:
though he is not engaged to detect fraud.
when the accountant acted with the intent to deceive.
when he makes simple judgmental errors, while operating in accordance with GAAP and GAAS.
when he fails to detect fraud or misconduct that a normal audit would uncover.
An accountant who fails to meet these standards or to detect fraud or misconduct that a normal audit would uncover may be held liable for negligence. An accountant is not required to have perfect judgment; she or he will not be held liable simply for errors in judgment that were made in good faith while operating in accordance with GAAP and GAAS.
Constructive fraud exists when:
a plaintiff proves that the accountant acted with the intent to deceive.
a plaintiff proves that the accountant misrepresented a material fact.
a plaintiff proves that the accountant was grossly negligent in performing his duties.
a plaintiff proves that he suffered an injury by relying on the fraudulent information.
Constructive fraud is fraud without fraudulent intent—a plaintiff must prove that the accountant was grossly negligent in performing his or her duties. Evidence of reckless disregard for duty and professional standards can help establish gross negligence and, thus, constructive fraud.
Under which of the following tests is an accountant liable to any third party who was or should have been foreseen as a possible user of the accountant’s work product and who did in fact use and rely on that work product for a proper business purpose?
Near- privity test
Restatement test
Reasonably foreseeable users test
Ultramares rule
Under the reasonably foreseeable users test, an accountant is liable to any third party who was or should have been foreseen as a possible user of the accountant’s work product and who did in fact use and rely on that work product for a proper business purpose.
According to Section 18 of the Securities Exchange Act of 1934:
it is unlawful for accountants, or anyone, to use any manipulative or deceptive device, which is against the rules and regulations of the SEC.
the action must be brought within three years of discovering the fraud by the plaintiff, for recovery.
accountants are held liable for negligence in performing an audit or constructing a financial statement.
accountants are liable for fraudulent statements made to the SEC in documents filed with it.
According to Section 18, accountants are liable for fraudulent statements made to the SEC in documents filed with it. Section 18 contains a built-in statute of limitations for recovery requiring that the action be brought within one year of discovering the fraud and within three years of its occurrence.
A _____ mark identifies the producers as belonging to a larger group, such as a trade union.
product trade
service
collective
certification
A trademark is a distinctive mark, word, design, picture, or arrangement used with a product that helps consumers identify the product with the producer. A collective mark identifies the producers as belonging to a larger group, such as a trade union.
The main focus of a case of trade-dress infringement is usually on:
whether it is famous.
the absence of secrecy.
whether it is legally registered.
the likelihood of consumer confusion.
To succeed on a claim of trade-dress infringement, a party must prove three elements: (1) The trade dress is primarily nonfunctional; (2) the trade dress is inherently distinctive or has acquired a secondary meaning; and (3) the alleged infringement creates a likelihood of confusion. The main focus of a case of trade-dress infringement is usually on whether there is likely to be consumer confusion.
One criteria for a work to be copyrightable, is:
when it involves huge amounts of investment.
when it is original and creative.
when the idea behind it cannot be set out in tangible form.
when it is created by famous personalities.
A copyright will be granted when a work is set out in a tangible medium of expression, is original, and is creative. Titles and short phrases may not be copyrighted. It is only the expression of the idea that is protected by copyright law, and not the underlying idea.
The protection independent of protection in the country of origin principle of the Berne Convention of 1886:
allows nationals of nonsignatory countries to protect works if they are created in a member country.
requires that protection not be conditioned on the use of formalities, although the country of origin may require registration or a similar formality.
requires that each member nation protect artists of all signatory nations equally.
establishes minimum standards for granting copyrights that all nations must meet.
The protection independent of protection in the country of origin principle allows nationals of nonsignatory countries to protect works if they are created in a member country. Eighty-one countries are now signatories of the Berne Convention of 1886.
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