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Appellate Courts


Appellate courts, also known as appeals courts or courts of appeals, are a higher level of court within a judicial system that have the authority to review and make decisions on cases previously heard and judged by lower courts. They examine if the law was applied correctly or if the process was fair, but they generally do not review the facts of the case. Their main role is to ensure legal procedures and principles were upheld during the initial trial.


The phonetic pronunciation of “Appellate Courts” is: ə-ˈpe-lət-korts

Key Takeaways

  1. Appellate Courts are higher courts that have the power to review, affirm, reverse, or modify the decisions of lower courts. They often serve as the final arbitrator of a legal dispute, ensuring that lower courts correctly interpreted the law.
  2. They do not conduct trials, instead they focus on legal arguments concerning the application of law used in the original court decision. This means they use the records of the lower courts to examine whether a judgement was made properly in light of the applicable laws or legal principles.
  3. Appellate court decisions set precedent that lower courts must follow. This ensures consistency and predictability in the legal system, because these decisions serve as guiding interpretations of laws and constitutions that lower courts must adhere to in the future.


Appellate courts play a crucial role in the business/finance sector as they are responsible for reviewing and potentially correcting decisions made by trial courts. When legal disputes arise over business transactions, contracts, or financial practices, the decisions made by the lower courts can have a significant impact on a company’s operations, finances, and reputation. If either party believes the decision was unjust, they have the right to appeal to an appellate court. Hence, the importance of appellate courts goes beyond delivering justice; their actions can directly influence a firm’s financial position, business strategy, and market confidence. As such, understanding the function and potential impact of appellate courts is important for anyone involved in the business or finance industry.


The primary purpose of appellate courts is to ensure that the law is applied correctly and fairly. They provide a platform where litigants can challenge a court’s decision if they believe there has been a legal or procedural error during their trial. Appellate courts review the rulings of lower courts to determine if the judicial procedures were followed and the decisions appropriately rendered. Unlike trial courts, which are established to determine the facts of a case, appellate courts primarily focus on how law has been interpreted or applied.In the business and financial domain, these courts play an indispensable role in a myriad of cases, from disputes over contracts to concerns about securities regulations. They serve as an essential check-and-balance system in the judiciary and help in maintaining the integrity of legal and business processes. For example, if a particular financial regulation is incorrectly applied by a lower court, potentially affecting the financial makeup of a company, the appellate court has the authority to rectify this. Hence, they act as a critical mechanism in dispelling legal misinterpretations and injustices.


1. The United States Court of Appeals: One of the most prominent examples of appellate courts in the real world is the United States Court of Appeals, also known as the Federal Circuit. This court has appellate jurisdiction over a multitude of cases, including those involving patents and patent applications. When individuals or businesses are not satisfied with a decision made in a lower court, they can appeal to the United States Court of Appeals for a more thorough examination of the evidence and legal principles involved. 2. Apple Inc. vs Samsung Electronics Co: In one of the most famous patent infringement lawsuits in recent history, Samsung appealed a decision made by a lower court that found the company guilty of infringing upon several of Apple’s patents. The decision, which initially ordered Samsung to pay over $1 billion in damages, was brought in front of the United States Court of Appeals for the Federal Circuit, which reduced the damages significantly.3. Obergefell v. Hodges: In this landmark case, decided by the Supreme Court of the United States, an appellate court, the legal definition of marriage was expanded to include same-sex couples, assuring them the same legal benefits and protections thorough the nation. The case reached the Supreme Court (the highest appellate court in the U.S.) after appeals against decisions in lower courts that had determined banning same-sex marriages was unconstitutional.

Frequently Asked Questions(FAQ)

What are Appellate Courts?

Appellate Courts, also known as the courts of appeals, are higher courts that have the power to review and revise cases that have already been heard and decided by trial courts. They evaluate whether the law was applied correctly in the original court proceedings.

How do Appellate Courts differ from Trial Courts?

Unlike trial courts that hear cases initially and make judgments based on factual evidence, appellate courts are mainly concerned with the application of the law in the original trial. Trial courts may involve juries, but appellate courts involve panel of judges.

What is the function of an Appellate Court in finance and business?

Appellate courts review cases related to finance and business to ensure fair and proper application of business law, contract law, tax law, finance law, and other related fields. They ensure that businesses operate within the scope of the law and that rulings are made accurately as per the legal framework.

Can all decisions from lower courts be appealed?

Not all decisions from lower courts can be appealed. Generally, it’s only final judgments and certain legally impactful decisions that can be reviewed by appellate courts.

What does it mean when a case is remanded by Appellate Court?

A case is ‘remanded’ when the appellate court sends it back to the trial court for further action or new trial. This typically happens if the appellate court determines an error was made in the original proceeding.

Do Appellate Courts conduct new trials?

No, appellate courts do not conduct new trials. Rather, they review procedurals and decisions of trial courts to ensure that correct legal standards and principles were applied during trials.

How many judges are typically involved in an appellate court case?

The number of judges in an appellate court case can vary, but it usually involves a panel of three judges.

What happens if the appellate court affirms the decision of the lower court?

If the appellate court affirms the decision of the lower court, the decision stands as is and the case is typically over, unless the party decides to appeal to a higher court, like the Supreme Court.

Related Finance Terms

  • Appeal
  • Reversible error
  • Circuit courts
  • Legal precedent
  • Judicial review

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