Stare deisis literally translates from Latin to, "stand by things decided" (Cornell, 2013). When a court makes a decision, they set precedent in that area. The decision is made based on law. That decision then becomes a part of case law and sets precedent. When another court hears a case involving the same laws, precedent has already been set in case law. The second court hearing a similar case cannot rule completely outside of the realm of how the first court ruled or it would violate stare decisis. Note that there are rare exceptions ...
This solution explains the concept of stare decisis and its relevance to the American legal system. The ways in which stare decisis is involved in business practices are also discussed. A comprehensive solution with additional student resources for expansion is provided.