Page 70 - Bus101FlipBook

5-12 Law, Business & Government [CH 5

This announcement and subsequent litigation has resulted in billions of dollars in fines
paid by tobacco companies and received by federal and state governments and litigant
attorneys. This success in the United States spawned similar litigation around the world in
socialist countries; because those governments have state-controlled healthcare systems
supported by taxes in their countries. Some think that they are punishing these companies

with the fines. However the reality is that the consumer is punished with higher prices
when purchasing a still legal product (tobacco). All taxes and regulations as a cost are
always passed onto the consumer in the form of higher prices. The increased cost is a
payment transference to government (a new form of taxation).
Of course, there are those that say it is proper since healthcare costs for smokers are

higher than for non-smokers, and it “cost[s] taxpayers billions of dollars under Medicare
and other [government-taxpayer funded] programs.” The reality is that healthcare for
smokers is expensive, but the greater question is should the United States government be
involved in Medicare? Should the taxpayer pay for the healthcare of smokers or should the
additional cost of healthcare for smokers be passed on directly to the smokers? Or maybe
deny them the same access since they are smokers and are responsible for their decisions?

Remember that tobacco use is legal, and congress has, through legislation, made the
taxpayer and consumer responsible to pay for the medical expenses associated with its use.

Administrative Law
Administrative Law Regulations that state and federal agencies pass are included in administrative law.
Regulations affecting Think of the plethora of governmental agencies and then you begin to appreciate the
business, passed by state overwhelming attributes of administrative law. These agencies enforce the laws affecting
and federal administrative business. To illustrate, there is the Federal Trade Commission, the Consumer Product
agencies.
Safety Commission, the Food and Drug Administration, and each state has an agency that
does the same thing as the federal agency. Examples of local agencies include your city
planning commissions, zoning boards and boards of appeal.

The Court System

Judiciary Our court system, the judiciary, is that branch of government charged with finding
That branch of government facts and applying the law when deciding disputes among parties. They are not to be
responsible for applying the unelected legislative bodies. The courts possess jurisdiction, which is the legal right and
law to deciding disputes power, to interpret laws, make binding decisions by applying the law. (The laws are written
among parties by the legislative branches of government.) Disputes are taken to the courts by one party to
an action filing a lawsuit.

The court system in the United States is a dual court system; federal courts and state
courts. The federal courts are established by congress as needed (Article III) to address
federal issues and as each state establishes its own court system, the state courts are to
address state issues and issues of citizens in their respective states. The structures of the
state and federal court systems are shown in Illustration 5.2. Administrative agencies also

have some limited judicial functions, but these agencies are more properly regarded as
belonging to the executive or legislative branches of government.

Trial Courts
Trial courts exist for both federal issues and state issues and are also known as courts
Trial court of general jurisdiction, though specific for either federal or state issues. Unless a case is
Hears the cases of litigants assigned by law to an administrative agency or a specific court, a court of general
operating at both the federal
and state levels. jurisdiction is empowered to hear the case, and courts of general jurisdiction do hear a wide
range of cases, both criminal and civil. In the federal court system, the trial courts are
known as United States district courts, and there is at least one federal district court in each
state. The general jurisdiction courts in state judicial systems are known as circuit courts,
and in most states there is one for each county.

Federal Court System
The United States Constitution in Article III, Section 1 established that “[t]he judicial
Power of the United States, shall be vested in one supreme Court, and in such inferior
Courts as the Congress may from time to time ordain and establish.” Section 2 of Article
III indicates that the supreme Court’s judicial power shall extend to all cases in law and
equity involving questions of constitutional law; disputes between states, disputes between

citizens of different states (or between a U.S. citizen and a citizen of another country);
bankruptcy, tax, postal, copyright, patent, or trademark laws; federal crimes and maritime
Copyrighted Material