Blog on the Run: Reloaded

Wednesday, August 17, 2011 8:33 pm

Corporations are people

Filed under: Evil — Lex @ 8:33 pm
Tags: ,

It’s legally true, as Mitt Romney famously reminded us recently. But in a number of ways, corporations are actually better than people (from a corporation’s standpoint), by which I mean they have all the privileges (no, they can’t vote, but they can buy politicians, which you can’t) and, increasingly, none of the obligations.

The latest upstanding person to argue that this is, in fact, the way things ought to be is ExxonMobil, which is arguing in court right now that it cannot be sued for torture:

Lawyers for Exxon Mobil Corp. have asked the full U.S. Court of Appeals for the D.C. Circuit to reject a panel decision that exposed the oil giant to corporate liability for alleged atrocities in Indonesia.

Exxon’s lawyers, including Sri Srinivasan of O’Melveny & Myers, said in a petition (PDF) that the three-judge panel got it wrong when it found Exxon can be held liable under the Alien Tort Statute.

The 2-1 panel decision “vastly expanded” the statute to find that corporations can be liable for violent acts committed abroad, Srinivasan said.

Srinivasan, chair of O’Melveny’s appellate and Supreme Court practice, said the panel decision, if it is not overturned, “threatens to unleash a flood of litigation in U.S. court for actions lacking any salient connection to the United States.”

Exxon’s lawyers said the D.C. Circuit decision conflicts with a ruling in the U.S. Court of Appeals for the 2nd Circuit. Srinivasan argued in Exxon’s petition that under customary international law only individuals, not corporations, can be held accountable for human rights violations.

“There is a strong presumption in American law that statutes do not apply extraterritorially, even where an express cause of action exists,” Srinivasan said. “There is nothing in the text or statutory history of the ATS sufficient to trump this strong presumption.”

The attorneys for Exxon urged the appeals court to “reject the notion that the ATS can be used as a vehicle to bring suit in U.S. courts for alleged misconduct that occurred abroad.”

Please note what the company is not doing here.

  • It is not arguing that it didn’t torture.
  • It is not arguing that it didn’t maliciously, recklessly or negligently allow torture.

No, it is arguing that it cannot even be sued over the possibility that it might have. It is arguing that no one should even have the right to make an allegation, marshal his evidence and let a judge or jury decide based on the facts and the law.

Spare me the technical legal argument. That technical legal argument — that the law allows only individuals, not corporations, to be so sued — is precisely my point. We are allowing corporations to commit crimes, including what would be capital offenses if committed by identifiable, individual humans, with impunity.

This choice — and it is a conscious choice, not just something that happened — is a choice we must renounce, or else we have lost the right to call ourselves civilized.

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1 Comment »

  1. Yes, under U.S. law, corporations are legal persons; but the law also recognizes that corporations, as such, have no motivation, intent, volition of their own — no free will, discernment, or souls.

    Apart from the fact that we wouldn’t appoint a guardian of the person, property and/or ad litem, corporations are much like any natural person laboring under similar incapacity or disability. Heck, I won’t even let a corporation “swear” an affidavit or “sign” a deed on it’s own initiative. We can (and do) appoint receivers or bankruptcy trustees equally for natural persons and legal entities, when circumstances warrant. We no longer issue “writs of lunacy” against such natural persons (although that process does have a certain emotional appeal where some statutory, legal entities are concerned), so the analogy — however tenuous — holds, so far so good. We also don’t impute culpability to, or impose criminal responsibility on, such incapacitated or disabled persons, whether legal or natural.

    But (and here’s where I get bombastic) we do hold guardians (read: “officers, agents, directors, etc.”) to a standard of care, both for the well being of their ward(s) (read: “entities”) and for good faith, fiduciary stewardship of resources properly belonging to others (read: “owners,” “shareholders,” “members,” “partners,” etc.). We typically require that any guardian’s action on behalf of its ward / entity be free of gross negligence and willful misconduct, and that the guardian avoid any criminal action he or she (note: they’re natural persons!) should reasonably know is wrong.

    I’ve not read Mr. Srinivasan’s petition, but all indications are he’s a bright guy who probably has both his facts and law straight on the limited topic of corporate criminal liability, at issue in his brief. Actually, I’m kind of impressed by the theoretical / policy level of his argument as quoted above. I don’t particularly have a problem with this perspective.

    What I do have a problem with, however, is the “guardians” of these “people” not doing their jobs, or using (abusing?) their charges for personal gain or to harm others. They’re the ones who should be prosecuted, and — whenever convicted — dealt with accordingly.

    I’m interested to hear other / further thoughts, suggestions, and perspectives.

    Comment by jasbro — Thursday, August 18, 2011 1:10 pm @ 1:10 pm | Reply


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