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Please read the following and answer the questions. Questions are at the bottom. Constitutional Law INTRODUCTION Many people assume that a government acts from a

Please read the following and answer the questions. Questions are at the bottom.

Constitutional Law

INTRODUCTION

Many people assume that a government acts from a vague position of strength and can enact any regulation it deems necessary or desirable. This chapter emphasizes a different perspective from which to view the law: action taken by the government must come from authority and this authority cannot be exceeded.

Neither Congress nor any state may pass a law in conflict with the Constitution. The Constitution is the supreme law in this country. The Constitution is the source of federal power and to sustain the legality of a federal law or action a specific federal power must be found in the Constitution. States have inherent sovereign powerthat is, the power to enact legislation that has a reasonable relationship to the welfare of the citizens of that state. The power of the federal government was delegated to it by the states while the power of the states was retained by them when the Constitution was ratified.

The Constitution does not expressly give the states the power to regulate, but limits the states' exercise of powers not delegated to the federal government.

CHAPTER OUTLINE

I.The Constitutional Powers of Government

Before the U.S. Constitution, the Articles of Confederation defined the central government.

A.A FEDERAL FORM OF GOVERNMENT

The U.S. Constitution established a federal form of government, delegating certain powers to the national government. The states retain all other powers. The relationship between the national government and the state governments is a partnershipneither partner is superior to the other except within the particular area of exclusive authority granted to it under the Constitution.

B.THE SEPARATION OF POWERS

Deriving power from the Constitution, each of the three governmental branches (the executive, the legislative, and the judicial) performs a separate function. No branch may exercise the authority of another, but each has some power to limit the actions of the others. This is the system of checks and balances.

Congress, for example, can enact a law, but the president can veto it.

The executive branch is responsible for foreign affairs, but treaties with foreign governments require the advice and consent of the members of the Senate.

Congress determines the jurisdiction of the federal courts, but the courts have the power to hold acts of the other branches of the government unconstitutional.

C.THE COMMERCE CLAUSE

1.The Commerce Clause and the Expansion of National Powers

The Constitution expressly provides that Congress can regulate commerce with foreign nations, interstate commerce, and commerce that affects interstate commerce. This provisionthe commerce clausehas had a greater impact on business than any other provision in the Constitution. This power was delegated to the federal government to ensure a uniformity of rules governing the movement of goods through the states.

CASE SYNOPSIS

Case 2.1:Heart of Atlanta Motel v. United States

A motel owner, who refused to rent rooms to African Americans despite the Civil Rights Act of 1964, brought an action to have the Civil Rights Act of 1964 declared unconstitutional.The owner alleged that, in passing the act, Congress had exceeded its power to regulate commerce because his motel was not engaged in interstate commerce. The motel was accessible to state and interstate highways. The owner advertised nationally, maintained billboards throughout the state, and accepted convention trade from outside the state (75 percent of the guests were residents of other states). The district court sustained the constitutionality of the act and enjoined the owner from discriminating on the basis of race. The owner appealed. The case went to the United States Supreme Court.

The United States Supreme Court upheld the constitutionality of the Civil Rights Act of 1964.The Court noted that it was passed to correct "the deprivation of personal dignity" accompanying the denial of equal access to "public establishments."Congressional testimony leading to the passage of the act indicated that African Americans in particular experienced substantial discrimination in attempting to secure lodging. This discrimination impeded interstate travel, thus impeding interstate commerce. As for the owner's argument that his motel was "of a purely local character," the Court said, "[I]f it is interstate commerce that feels the pinch, it does not matter how local the operation that applies the squeeze." Therefore, under the commerce clause, Congress has the power to regulate any local activity that has a harmful effect interstate commerce.

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Notes and Questions

Does the Civil Rights Act of 1964 actually regulate commerce or was it designed to end the practice of race (and other forms of) discrimination? In this case, the Supreme Court said, "[T]hat Congress was legislating against moral wrongs ... rendered its enactments no less valid."

Are there any businesses in today's economy that are "purely local in character"? An individual who contracts to perform manual labor such as lawn mowing or timber cutting within a small geographic area might qualify, as long as the activity has no effect on interstate commerce. But in most circumstances it would be difficult if not impossible to do business "purely local in character" in today's U.S. economy. Federal statutes that derive their authority from the commerce clause often include requirements or limits to exempt small or arguably local businesses.

Which constitutional clause empowers the federal government to regulate commercial activities among the states? To prevent states from establishing laws and regulations that would interfere with trade and commerce among the states, the Constitution expressly delegated to the national government the power to regulate interstate commerce. The commerce clauseArticle I, Section 8, of the U.S. Constitutionexpressly permits Congress "[t]o regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes."

2.The Commerce Clause Today

The United States Supreme Court has recently limited the clause in its reach, in decisions that significantly enhanced the sovereign power of the states within the federal system. Some of these decisions are detailed in the text. Essentially, the holdings of these cases state that the clause does not support the national regulation of non-economic conduct.

3.The Regulatory Powers of the States

A state can regulate matters within its own borders under its police power.

4.The "Dormant" Commerce Clause

States do not have the authority to regulate interstate commerce. When state regulations impinge on interstate commerce, the state's interest in the merits and purposes of the regulation must be balanced against the burden placed on interstate commerce.It is difficult to predict the outcome in a particular case.

ENHANCING YOUR LECTURE

DOES STATE REGULATION OF INTERNET PRESCRIPTION

TRANSACTIONS VIOLATE THE COMMERCE CLAUSE?

Every year, about 30 percent of American households purchase at least some prescription drugs online.There is nothing inherently unlawful in such a transaction.Consider that Article X of the Constitution gives the states the authority to regulate activities affecting the safety and welfare of their citizens.In the late 1800s, the states developed systems granting physicians the exclusive rights to prescribe drugs and pharmacists the exclusive right to dispense prescriptions. The courts routinely upheld these state laws.a All states use their police power authority to regulate the licensing of pharmacists and the physicians who prescribe drugs.

AN EXTENSION OF STATE LICENSING LAWS

About 40 percent of the states have attempted to regulate Internet prescription transactions by supplementing their licensure rules in such a way to define a "safe" consulting relationship between the physician prescribing and the pharmacists dispensing prescription drugs.For example, certain states allow an electronic diagnosis.This consists of a patient filling out an online questionnaire that is then "approved" by a physician before an Internet prescription is filled and shipped.In contrast, other states specifically prohibit a physician from creating a prescription if there is no physical contact between the patient and the physician providing the prescription.

SOME STATES ARE ATTEMPTING TO REGULATE INTERSTATE COMMERCE

Recently, the New York State Narcotic Bureau of Enforcement started investigating all companies in New Jersey and Mississippi that had been involved in Internet prescription medicine transactions with residents of New York.None of the companies under investigation has New York offices.The legal question immediately raised is whether the New York State investigations are violating the commerce clause.Moreover, it is the Food and Drug Administration (FDA) that enforces the regulation of prescription drugs, including their distributors.

ARE NEW YORK AND OTHER STATES VIOLATING THE DORMANT COMMERCE CLAUSE?

As you learned in this chapter, the federal government regulates all commerce not specifically granted to the states.This is called the dormant commerce clause.As such, this clause prohibits state regulations that discriminate against interstate commerce.Additionally, this clause prohibits state regulations that impose an undo burden on interstate commerce.The dormant commerce clause has been used in cases that deal with state regulation of pharmacy activities.b

In this decade, there is an opposing view based on a line of cases that suggest that state regulation of Internet activities do not violate the dormant commerce clause. In one case, a New York state law that banned the sale of cigarettes to its residents over the Internet was found not to violate the dormant commerce clause because of public health concerns.d In another case, a Texas statute that prohibited automobile manufacturers from selling vehicles on its Web site was upheld.e Whether the reasoning in these cases will be extended to cases involving Internet pharmacies remains to be seen. There exist state laws limiting Internet prescriptions. For example, in Nevada, no resident can obtain a prescription from an Internet pharmacy unless that pharmacy is licensed and certified under the laws of Nevada. Because this statute applies equally to in-state and out-of-state Internet pharmacies, it is undoubtedly nondiscriminatory. Additionally, the requirement that Internet pharmacies obtain a Nevada license prior to doing business in the state will probably be viewed as not imposing an undo burden on interstate commerce

WHERE DO YOU STAND?

Clearly, there are two sides to this debate. Many states contend that they must regulate the provision of prescription drugs via the Internet in order to ensure the safety and well-being of their citizens. In some instances, however, the states may be imposing such regulations at the behest of traditional pharmacies, which do not like online competition. What is your stand on whether state regulation of Internet prescription drug transactions violates the dormant commerce clause of the Constitution? Realize that if you agree that it does, then you probably favor less state regulation. If you believe that it does not, then you probably favor more state regulation.

a. See, for example, Dent v. West Virginia, 129 U.S. 114, 9 S.Ct. 231, 32 L.Ed. 623 (1889).

b. See, for example, Pharmaceutical Manufacturers' Association v. New Mexico Board of Pharmacy, 86 N.M. 571, 525 P.2d 931 (N.M. App. 1974); State v. Rasmussen, 213 N.W.2d 661 (Iowa 1973).

c. See American Libraries Association v. Pataki, 969 F.Supp.160 (S.D.N.Y. 1997).

d. Brown & Williamson Tobacco Corp. v. Pataki, 320 F.3d 200 (2nd Cir. 2003).

e. Ford Motor Company v. Texas Department of Transportation, 264 F.3d 493 (5th Cir. 2001).

D.THE SUPREMACY CLAUSE

The Constitution, laws, and treaties of the United States are the supreme law of the land. When there is a direct conflict between a federal law and a state law, the state law is held to be invalid.

1.Preemption

When Congress chooses to act exclusively in an area of concurrent federal and state powers, it is said to preempt the area, and a valid federal law will take precedence over a conflicting state or local law.

2.Congressional Intent

Generally, congressional intent to preempt will be found if a federal law is so pervasive, comprehensive, or detailed that the states have no room to supplement it. Also, when a federal statute creates an agency to enforce the law, matters that may come within the agency's jurisdiction will likely preempt state laws.

II.Business and the Bill of Rights

The first ten amendments to the Constitution embody protections against various types of interference by the federal government. These are listed in the text.

A.LIMITS ON FEDERAL AND STATE GOVERNMENTAL ACTIONS

Most of the rights and liberties in the Bill of Rights apply to the states under the due process clause of the Fourteenth Amendment. The United States Supreme Court determines the parameters.

B.THE FIRST AMENDMENTFREEDOM OF SPEECH

The freedoms guaranteed by the First Amendment cover symbolic speech (gestures, clothing, and so on) if a reasonable person would interpret the conduct as conveying a message.

1.Reasonable Restrictions

A balance must be struck between the government's obligation to protect its citizens and those citizens' exercise of their rights.

a.Content-Neutral Laws

If a restriction imposed by the government is content neutral (aimed at combating a societal problem such as crime, not aimed at suppressing expressive conduct or its message), then a court may allow it.

b.Laws That Restrict the Content of Speech

To regulate the content of speech, a law must serve a compelling state interest and be narrowly written to achieve that interest.

2.Corporate Political Speech

Speech that otherwise would be protected does not lose that protection simply because its source is a corporation. For example, corporations cannot be entirely prohibited from making political contributions that individuals are permitted to make.

3.Commercial Speech

Commercial speech is not protected as extensively as noncommercial speech. Even if commercial speech concerns a lawful activity and is not misleading, a restriction on it will generally be considered valid as long as the restriction (1) seeks to implement a substantial government interest, (2) directly advances that interest, and (3) goes no further than necessary to accomplish its objective.

CASE SYNOPSIS

Case 2.2: Bad Frog Brewery, Inc. v. New York State Liquor Authority

Bad Frog Brewery, Inc., sells alcoholic beverages with labels that display a frog making a gesture known as "giving the finger." Bad Frog's distributor, Renaissance Beer Co., applied to the New York State Liquor Authority (NYSLA) for label approval, required before the beer could be sold in New York. The NYSLA denied the application, in part because children might see the labels in grocery and convenience stores. Bad Frog filed a suit in a federal district court against the NYSLA, asking for, among other things, an injunction against this denial.The court granted a summary judgment in favor of the NYSLA.Bad Frog appealed.

The U.S. Court of Appeals for the Second Circuit reversed. The NYSLA's ban on the use of the labels lacked a "reasonable fit" with the state's interest in shielding minors from vulgarity, and the NYSLA did not adequately consider alternatives to the ban. "In view of the wide currency of vulgar displays throughout contemporary society, including comic books targeted directly at children, barring such displays from labels for alcoholic beverages cannot realistically be expected to reduce children's exposure to such displays to any significant degree." Also, there were "numerous less intrusive alternatives."

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Notes and Questions

The free flow of commercial information is essential to a free enterprise system. Individually and as a society, we have an interest in receiving information on the availability, nature, and prices of products and services. Only since 1976, however, have the courts held that communication of this information("commercial speech") is protected by the First Amendment.

Because some methods of commercial speech can be misleading, this protection has been limited, particularly in cases involving in-person solicitation. For example, the United States Supreme Court has upheld state bans on personal solicitation of clients by attorneys. Currently, the Supreme Court allows each state to determine whether or not in-person solicitation as a method of commercial speech is misleading and to restrict it appropriately.

Whose interests are advanced by banning certain ads? The government's interests are advanced when certain ads are banned. For example, in the Bad Frog case, the court acknowledged, by advising the state to restrict the locations where certain ads could be displayed, that banning of "vulgar and profane" advertising from children's sight arguably advanced the state's interest in protecting children from those ads.

ADDITIONAL CASES ADDRESSING THIS ISSUE

Advertising and the Commerce Clause

Cases involving the constitutionality of government restrictions on advertising under the commerce clause include the following.

Cases in which restrictions on advertising were held unconstitutional include Thompson v. Western States Medical Center, __ U.S. __, 122 S.Ct. 1497, 152 L.Ed.2d 563 (2002) (restrictions on advertising of compounded drugs); and This That and Other Gift and Tobacco, Inc. v. Cobb County, 285 F.3d 1319 (11th Cir. 2002) (restrictions on advertising of sexual devices).

Cases in which restrictions on advertising were held not unconstitutional include Long Island Board of Realtors, Inc. v. Inc. Village of Massapequa Park, 277 F.3d 622 (2d Cir. 2002) (restrictions on signs in residential areas); Borgner v. Brooks, 284 F.3d 1204 (11th Cir. 2002) (restrictions on dentists' ads); Genesis Outdoor, Inc. v. Village of Cuyahoga Heights, __ Ohio App.3d __, __ N.E.2d __ (8 Dist. 2002) (restrictions on billboard construction); and Johnson v. Collins Entertainment Co., 349 S.C. 613, 564 S.E.2d 653 (2002) (restrictions on offering special inducements in video gambling ads).

4.Unprotected Speech

Constitutional protection has never been afforded to certain classes of speechdefamatory speech, threats, child pornography, "fighting" words, and statements of fact, for example.

a.Obscenity

Obscene material is unprotected. But other than child pornography, there is little agreement about what material qualifies as obscene. The United States Supreme Court has held that material is obscene if

The average person finds that it violates contemporary community standards.

The work taken as a whole appeals to a prurient interest in sex.

The work shows patently offensive sexual conduct.

The work lacks serious redeeming literary, artistic, political, or scientific merit.

b.Virtual Child Pornography

Another exception is a law that makes it a crime to intentionally distribute virtual child pornographywhich uses computer-generated images, not actual peoplewithout indicating that it is computer-generated.

C.THE FIRST AMENDMENTFREEDOM OF RELIGION

1.The Establishment Clause

Under the establishment clause, the government cannot establish a religion nor promote, endorse, or show a preference for any religion.

a.Applicable Standards

Federal or state law that does not promote, or place a significant burden on, religion is constitutional even if it has some impact on religion.

b.Religious Displays

Public displays that include nonreligious symbols or symbols of different religions, or that have historical, as well as religious, significance do not necessarily violate the establishment clause.

2.The Free Exercise Clause

Under the free exercise clause, the government cannot prohibit the free exercise of religious practices. In other words, a person cannot be compelled to do something contrary to his or her religious practices unless the practices contravene public policy or public welfare.

a.Restrictions Must Be Necessary

The government must have a compelling state interest for restricting the free exercise of religion, and the restriction must be the only way to further that interest.

CASE SYNOPSIS

Case 2.3: Holt v. Hobbs

Gregory Holt, an inmate in an Arkansas state prison, is a devout Muslim who wished to grow a beard in accord with his religious beliefs. The Arkansas Department of Correction prohibited inmates from growing beards (except for medical reasons). Holt asked for an exemption on religious grounds. Prison officials denied his request. Holt filed a suit in a federal district court against Ray Hobbs, the director of the department, and others, claiming a violation of the Religious Land Use and Institutionalized Persons Act of 2000 (RLUIPA), which governs religious exercise by institutionalized persons. The court dismissed the suit. The U.S. Court of Appeals for the Eighth Circuit affirmed. Hobbs appealed.

The United States Supreme Court reversed and remanded The prohibition against the beard did not likely further the department's compelling interest in stopping the flow of contrabandthe beard was too short. And the policy was not shown to be the least restrictive means of furthering this interest. The department could simply search an inmate's beard when it searched his hair and clothing. And the department could photograph all inmates periodically to record changes in their appearances.

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Notes and Questions

Suppose that instead of a state prison regulation and an inmate, the facts of this case had involved a private employer and an employee who wished to grow a beard for religious reasons in contravention of the employer's dress code. Would the result have been the same? The result might have been the same, but the judgment and reasoning would have been based on federal statutory employment discrimination law instead of the U.S. Constitution. The Bill of Rights protects against interference with certain rights by the government, not private businesses. But under the Civil Rights Act of 1964, discrimination on the basis of religion is prohibited, and private businesses are required to reasonably accommodate the religious beliefs of their employees, unless that would cause the employer undue hardship.

b.Public Welfare Exception

When public safety is an issue, an individual's religious beliefs often must give way to the government's interests in protecting the public.

III.Due Process and Equal Protection

A.DUE PROCESS

Both the Fifth and the Fourteenth Amendments provide that no person shall be deprived "of life, liberty, or property, without due process of law."

1.Procedural Due Process

A government decision to take life, liberty, or property must be made fairly. Fair procedure has been interpreted as requiring that the person have at least an opportunity to object to a proposed action before a fair, neutral decision maker (who need not be a judge).

2.Substantive Due Process

If a law or other governmental action limits a fundamental right, it will be held to violate substantive due process unless it promotes a compelling or overriding state interest. Fundamental rights include interstate travel, privacy, voting, and all First Amendment rights. Compelling state interests could include, for example, public safety. In all other situations, a law or action does not violate substantive due process if it rationally relates to any legitimate governmental end.

B.EQUAL PROTECTION

Under the Fourteenth Amendment, a state may not "deny to any person within its jurisdiction the equal protection of the laws." The equal protection clause applies to the federal government through the due process clause of the Fifth Amendment. Equal protection means that the government must treat similarly situated individuals in a similar manner. When a law or action distinguishes between or among individuals, the basis for the distinction (the classification) is examined.

1.Strict Scrutiny

If the law or action inhibits some persons' exercise of a fundamental right or if the classification is based on a race, national origin, or citizenship status, the classification is subject to strict scrutinyit must be necessary to promote a compelling interest.

2.Intermediate Scrutiny

Intermediate scrutiny is applied in cases involving discrimination based on gender or legitimacy. Laws using these classifications must be substantially related to important government objectives.

3.The "Rational Basis" Test

In matters of economic or social welfare, a classification will be considered valid if there is any conceivable rational basis on which the classification might relate to any legitimate government interest.

IV.Privacy Rights

A personal right to privacy is held to be so fundamental as to apply at both the state and the federal level. Although there is no specific guarantee of a right to privacy in the Constitution, such a right has been derived from guarantees found in the First, Third, Fourth, Fifth, and Ninth Amendments.

A.FEDERAL PRIVACY LEGISLATION

Federal laws relating to privacy include, among others

The Freedom of Information Act of 1966

The Privacy Act of 1974

The Electronic Communications Privacy Act of 1986

The Health Insurance Portability and Accountability Act (HIPAA) of 1996

B.THE USA PATRIOT ACT

The USA Patriot Act of 2001 gave officials the authority to monitor Internet activities and access personal information without proof of any wrongdoing.

ADDITIONAL BACKGROUND

USA PATRIOT Act Tech Provisions

The Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act (USA PATRIOT Act) of 2001, which is mentioned in the text, touches on many topics, including immigration, money laundering, terrorism victim relief, intelligence gathering, and surveillance of Internet communications. Technology related provisions of the USA PATRIOT Act include the following, as summarized. (Some of these provisions were due to "sunset" in 2005.)

Wiretap Offenses

Sections 201 and 202Crimes that can serve as a basis for law enforcement agencies (LEAs) to obtain a wiretap include crimes relating to terrorism and crimes relating to computer fraud and abuse.

Voice Mail

Section 209LEAs can seize voice mail messages, with a warrant.

ESP Records

Sections 210 and 211LEAs can obtain, with a subpoena, such information about e-communications service providers' (ESPs) subscribers as "name," "address," "local and long distance telephone connection records, or records of session times and durations," "length of service (including start date) and types of service utilized," "telephone or instrument number or other subscriber number or identity, including any temporarily assigned network address," and "means and source of payment for such service (including any credit card or bank account number)."

Pen Registers, and Trap and Trace Devices

Section 216LEAs can expand their use of pen registers and trap and trace devices (PR&TTs). A PR records the numbers that are dialed on a phone. TTs "capture the incoming electronic or other impulses which identify the originating number of an instrument or device from which a wire or electronic communication was transmitted." PR&TTs can be used to capture routing, addressing, and other information in e-communications, but not the contents of the communication. This is considered one of the key sections of the act.

Computer Trespassers

Section 217LEAs can assist companies, universities, and other entities that are subject to distributed denial of service, or other, Internet attacks by intercepting "computer trespasser's communications."

ESP Compensation

Section 222An ESP "who furnishes facilities or technical assistance pursuant to section 216 shall be reasonably compensated for such reasonable expenditures incurred in providing such facilities or assistance."

ENHANCING YOUR LECTURE

CREATING A WEB SITE PRIVACY POLICY

Firms with online business operations realize that to do business effectively with their customers, they need to have some information about those customers. Yet online consumers are often reluctant to part with personal information because they do not know how that information may be used. To allay consumer fears about the privacy of their personal data, as well as to avoid liability under existing laws, most online businesses today are taking steps to make and implement Web site privacy policies.

PRIVACY POLICY GUIDELINES

In the last several years, a number of independent, nonprofit organizations have developed model Web site privacy policies and guidelines for online businesses to use.Web site privacy guidelines are now available from a number of online privacy groups and other organizations, including the Online Privacy Alliance, the Internet Alliance, and the Direct Marketing Association.Some organizations, including the Better Business Bureau, have even developed a "seal of approval" that Web-based businesses can display at their sites if they follow the organization's privacy guidelines.

One of the best known of these organizations is TRUSTe. Web site owners that agree to TRUSTe's privacy standards are allowed to post the TRUSTe "seal of approval" on their Web sites. The idea behind the seal, which many describe as the online equivalent of the "Good Housekeeping Seal of Approval," is to allay users' fears about privacy problems.

DRAFTING A PRIVACY POLICY

Online privacy guidelines generally recommend that businesses post notices on their Web sites about the type of information being collected, how it will be used, and the parties to whom it will be disclosed. Other recommendations include allowing Web site visitors to access and correct or remove personal information and giving visitors an "opt-in" or "opt-out" choice. For example, if a user selects an "opt-out" policy, the personal data collected from that user would be kept private.

In the last several years, the Federal Trade Commission (FTC) has developed privacy standards that can serve as guidelines. An online business that includes these standards in its Web site privacy policiesand makes sure that they are enforcedwill be in a better position to defend its policy should consumers complain about the site's practices to the FTC. The FTC standards are incorporated in the following checklist.

CHECKLIST FOR A WEB SITE PRIVACY POLICY

1.Include on your Web site a notice of your privacy policy.

2.Give consumers a choice (such as opt-in or opt-out) with respect to any information collected.

3.Outline the safeguards that you will employ to secure all consumer data.

4.Let consumers know that they can correct and update any personal information collected by your business.

5.State that parental consent is required if a child is involved.

6.Make a mechanism to enforce the policy.

Please offer a well reasoned and articulate discussion on a case relevant to this under study which includes the rationale for the decision in same along with the ramifications thereof for business and society.

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