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Full file at PRE-TEST CASE 1. Jason was arrested under a city ordinance that made distributing handbills on the city streets a crime. Jason argued that the U.S. Constitution guaranteed his right to free speech under the First Amendment. The local prosecutor argued that the First Amendment to the U.S. Constitution did not apply to state laws. Was the prosecutor correct? Explain. Ans: The prosecutor was wrong. Jason’s argument was correct in that the First Amendment extends the protections of the Bill of Rights to state governments. Difficulty: Easy Page: 33, 34 LO: 3 2. Alwyn Corp. is fined by the Occupational Safety and Health Administration for violations of workplace safety regulations. Alwyn challenges the fine on the basis that it was not allowed to have a jury trial before being fined. Discuss. Ans: The Seventh Amendment to the U.S. Constitution only guarantees trials in common law cases, not administrative agency action. Alwyn Corp. loses. Difficulty: Easy Page: 33, 34 LO: 3 3. Small towns want to restrict the speed of trains passing through the town to 20 miles per hour. The Federal Railroad Administration allows trains to travel through the towns at up to 70 miles per hour. Discuss whether or not the towns may restrict the speed of the trains. Ans: A variety of decisions have found preemption under the doctrine of supremacy in spite of the strong local safety concerns. Students might argue in support of these local interests. Difficulty: Easy Page: 35 LO: 4

POST-TEST CASE 1. A number of states including New York regulate or prohibit the interstate shipment of wine to consumers on the basis that alcoholic beverages only be sold to consumers by responsible, licensed and accountable in-state retailers. A U.S. wine wholesale association challenges these statutes representing wholesalers licensed under California state laws. Ans: This issue is presented in Granholm v. Heald in which the Sixth Circuit struck down the ban as discriminating against interstate commerce. Difficulty: Hard Page: 35 LO: 4 2. A local city council enacts an ordinance that prohibits aircraft from taking off before 7:00 A.M. and disturbing the city’s residents. An airline whose schedule is subject to federal regulation challenges this ordinance. Discuss the legal basis of this challenge and the likely outcome.


Full file at Ans: The principle of supremacy, the commerce clause in this case, allows federal regulations enacted under Constitutional authority to be superior to state law. The airline wins. Difficulty: Medium Page: 35 LO: 4 3. Missouri statutes authorize the collection of taxes “equivalent to four percent of the amount paid‌in any place of amusement, entertainment or recreation games and athletic events.â€? The state wants to collect tax on the rental of bowling shoes at a bowling alley. There is a 1977 precedent finding that sales tax applies to bowling related fees and charges at a bowling alley. There is a 1999 precedent that operating video games are rentals of personal property in a place of amusement and since the owners paid tax on the video machines when they purchased them, there is no tax on a subsequent rental. Tropicana Lanes wishes to challenge the tax on rental of bowling shoes. Discuss the legal doctrine applicable to this challenge and its application to Tropicana Lanes. Ans: The Missouri Supreme Court in Tropicana Lanes v. Director of Revenue followed the 1977 precedent as more precisely relevant under the doctrine of stare decisis. Difficulty: Hard Page: 38 LO: 7


Test bank business law with ucc applications 12th edition brown