Civil rights for corporations?

[rukawa]

Pretty interesting discussion of how corporations amassed various constitutional rights:

[LC]

I think it should be all or nothing. Fine with "corporations" having civil rights, but when was the last time a corporation was tried for murder or manslaughter etc.?

[Jurgis]

I think I should incorporate myself and my gun as LLC and when I shoot someone, the gun should take the responsibility and be jailed.

 

8)

 

 

There goes the thread.

[rukawa]

I think it should be all or nothing. Fine with "corporations" having civil rights, but when was the last time a corporation was tried for murder or manslaughter etc.?

 

It would be interesting to see how Europe deals with this. Its not that straightforward. As this example makes clear:

https://en.wikipedia.org/wiki/NAACP_v._Alabama

 

And of course another good example is this one:

https://en.wikipedia.org/wiki/The_Post_(film)

 

What I found really surprising is that the vast majority of freedom of speech cases are actually brought by corporations.

 

The reason this is difficult it because individuals alone are relatively powerless. If you give all civil rights to only individuals then it makes it impossible to group together and pool resources as the NAACP did when it was fighting for the civil rights of blacks. Or as the Washington Post did when it published the Pentagon papers.

 

Some of these cases are interesting. For instance should Tech companies have fourth amendment rights:

https://techcrunch.com/2015/12/13/should-tech-companies-be-subject-to-the-fourth-amendment/

 

What is really interesting is the extent to which liberals have argued on behalf of corporate rights in order to advance various causes. Heck Ralph Nader even argued for corporate freedom of speech to enable pharmacists to compete more vigorously:

http://scholarship.law.wm.edu/cgi/viewcontent.cgi?article=1813&context=wmborj

[Cigarbutt]

The distinction between property rights and liberty rights is important.

Corporations can be thought of as interest groups formed by people.

 

James Madison who was instrumental in bringing forward the Constitution and who was a champion of alliances and compromises warned against "factions" who could undermine the fundamental balancing act. An argument can be made that corporations may have an unusual amount of power that needs to be restrained.

 

In order to guard against unintended consequences, a way to manage this would be to open the possibility for corporations to invoke liberty rights only in selected circumstances and in exchange of a decreased threshold to pierce the corporate veil.

 

In that sense, IMO, it would be "fair" for corporations to have some protection in certain areas (expropriation, reasonable ability to earn profits etc) but at the same time, socialization of risk should be associated with a relative loss of limited liability. I submit that previous customs of making bank directors personally liable for losses was a helpful bulwark against moral hazard.

[bookie71]

When I went to college in the dark ages (early 1960's) the business law text said that (paraphrased) corporations were artificial beings created by state law and their "rights" were only those rights specifically granted to them by the states.

Things have sure changed - and not for the best imho

[Cigarbutt]

When I went to college in the dark ages (early 1960's) the business law text said that (paraphrased) corporations were artificial beings created by state law and their "rights" were only those rights specifically granted to them by the states.

Things have sure changed - and not for the best imho

 

The basic idea here is: the business of business is business.

 

In the 1960's, Davis and Blomstrom came up with the idea that firms had a social role to play and then followed the corporate responsibility concept. I don't agree with that approach but I think they had a point when they said: "In the long run, those who do not use power in a manner that society considers responsible will tend to lose it".

 

Play by the rules but the rules of the game have to be fair, somehow.

Rights come with responsibilities.

 

For instance, Starbucks has played the human rights game before and now the CEO will spend some time in Philadelphia.

 

[rukawa]

European law also appea

The distinction between property rights and liberty rights is important.

Corporations can be thought of as interest groups formed by people.

 

There are no property rights in the US protected by the constitution...probably because it would have protected slavery. Interestingly Europe does have similar jurisprudence protecting corporations and it also has property rights explicitly protected:

http://theconversation.com/how-human-rights-law-has-been-used-to-guarantee-corporations-a-right-to-profit-74593

 

Everyone appears to be against rights for corps. But as far as I can see no one would be against the way any of these cases were decided...or at least no one has made a single argument. How would you protect the NAACP? Or the Washington Post?

 

I look at South America and what happened to Venezuela and I feel the rights corporations enjoyed in the US including the liberty rights that Cigarbutt distinguishes would have prevented what has turned out to be a horrible disaster. At every step of the way the lack of property rights and corporate rights allowed the systematic dismantling of every institution that opposed the Venezuelan government. Why is this a good thing?

 

The effect of these rights to create a set of numerous factions. Each of which is very powerful and in competition with each other for power and money. This makes it difficult for a demagogue or national saviour (e.g. Trump, Hugo Chavez) to effectively do whatever he wants. At ever step he can be opposed by these factions which cannot be easily destroyed because they are protected in various ways by courts. In some sense this is the exact opposite of the totalitarian corporatism that was desired by fascists and socialists at the turn of the century where all entities would be suborned to the needs of the State.

[LC]

I'm all for civil rights for corporations. I'd just like them to be enforced:

 

A huge injustice: Victims of a massive corporate crime in Texas had to wait seven long years to hear how much restitution they'd be paid. When the verdict was announced in late April, it was not what they expected: $0.

 

Venezuelan-owned CITGO operated an oil refinery in the lower-income neighborhood of Hillcrest, in Corpus Christi. The refinery was emitting noxious fumes — including the carcinogen benzene — during a 10-year period with no regulations whatsoever. Benzene can cause cancer, damage fetuses and thin blood. In 2007, a jury deemed the corporation guilty for violating the Clean Air Act — but in a landmark decision, they weren't just guilty civilly, but also criminally responsible as well. The ruling was the first of its kind for a major oil company.

 

It took seven years for a sentence to be handed down. But on April 30, a federal judge ruled that CITGO Petroleum Corp. would not owe restitution to victims even though they had been exposed to toxic chemicals. U.S. District Judge John D. Rainey wrote in his statement that determining the actual amount owed to the Corpus Christi residents would "unduly delay the sentencing process" and therefore, "outweighs the need to provide restitution to any victims."

 

Classy. No civil punishment, no criminal punishment.

 

This is the problem - corporations are used as barriers to prevent any real consequence to the individuals that commit crimes.

 

And on this point:

The effect of these rights to create a set of numerous factions. Each of which is very powerful and in competition with each other for power and money. This makes it difficult for a demagogue or national saviour (e.g. Trump, Hugo Chavez) to effectively do whatever he wants.

 

Sometimes this is how it works out. Other times these factions collude and monopolize - lobbying to remove regulations, or just flat out ignoring regulations.

[Cigarbutt]

To prevent the deleterious aspects of factions, there need to be separation of power as well as checks and balances. The US is not perfect but the design allows dynamic adjustments. I agree that corporations have unusual ressources and that needs to be monitored. In Venezuela, property rights existed; they were simply not enforced because of concentrated power, corruption and a dependent judiciary arm.

 

LC,

 

The case you describe piqued my interest as I was involved, in another life, in similar cases (both sides of the fence).

 

I agree that the decision "seems" unfair but I politely submit that you may be cutting corners. I understand that an appeal may be underway. Also, you may want to put yourself in the position of the judge. On the surface, you "see", on the one hand, this big and profitable company that doesn't seem to put emphasis of environmental protections and, on the other hand, a group of poor people suffering from many ailments. However, these environmental exposure cases are extremely complex as disease causation is incredibly difficult to prove because disease profile prevalence variations may be due to a very high number of potential causes, including intrinsic (personal) causes. Let's say you are the judge, how do you determine the amounts arising from the inevitable necessity to attribute damage to a variety of causes in the context of mostly inconclusive studies? I understand that the judge defined criteria that could become case law.

 

https://mic.com/articles/89447/a-huge-corporation-just-got-away-with-murder-and-it-sets-a-scary-precedent#.8bOm3Of2c

 

I agree that the bar may have been set relatively high and that the government may subsidize studies and define guidelines in certain circumstances to help groups of people that lack ressources to "defend" themselves but I politely submit that arbitrarily deciding amounts may not result in a fair result.

 

Having said that, the burden of proof is high but it can be done.

 

Erin Brockovich has written a book and it's titled:  Take It From Me: Life's a Struggle But You Can Win.

 

 

[LC]

However, these environmental exposure cases are extremely complex as disease causation is incredibly difficult to prove because disease profile prevalence variations may be due to a very high number of potential causes, including intrinsic (personal) causes.

 

I completely agree. Does that mean it shouldn't be done? Or that therefore the victims are not owed any justice? Seems absurd.

 

I did some more digging, here is the issue:

 

The government has calculated that Citgo pulled in $1 billion over the decade it operated its refinery illegally. If U.S. District Court Judge John D. Rainey were to empanel a jury to consider such “pecuniary gain,” Citgo could theoretically pay up to $2 billion in penalties. Rainey has so far declined to establish a jury, ruling that it would prolong the sentencing process. (An irony that isn’t lost on some. “That’s too funny,” said Suzie Canales, an environmental justice activist in Corpus. “People have died waiting for the judge.”) Without a sentencing jury, the judge can levy a maximum fine of only $2 million—a paltry sum compared to the billion the company earned during its criminal activity.

 

And that is exactly what happened: a sentencing jury was not established, the excuse being it would "take too long", and therefore Citgo pays a 0.2% cost-of-doing-business expense. 0.2%!!!

 

[Cigarbutt]

"a sentencing jury was not established, the excuse being it would "take too long", and therefore Citgo pays a 0.2% cost-of-doing-business expense. 0.2%!!!"

 

Just read that Lance Armstrong has settled with the US government. He is not a corporation. The deal seems unfair but would need to evaluate the merits of the case before judging.

 

The case you mention is interesting and raises questions about fairness on many levels. (regulations, municipal and local enforcements, socio-economic issues and differential treatment of small versus large corporations).

 

Let's say your new house (I hope you enjoy yours) is near a beautiful golf course or in the neighborhood on an electricity transmission line and you get nominated by your community because of your civic engagement qualities and it is felt that there is an unusual incidence of cancers in the area. Results of investigations demonstrate that the "corporations" did not follow environmental guidelines (pesticides, distance from fields) and some studies remotely suggest the possibility that there may be a link between the violations and the cancers documented.

 

Then do you expect the fines for the violations to be proportional to the profitability of the corporations and do you expect that automatically someone will guess how much should be distributed to people who were diagnosed with cancers?

 

Remember also that the burden of proof is much higher for criminal cases vs civil cases.

 

As said before, there is data available and favorable verdicts can be reached. Need good people AND a strong case. Even if I don't know the underlying specifics of the causality dilemma for this pecific case, I understand that people in the community got together to fight "the toxic neighbors".

 

http://www.umich.edu/~snre492/mezza.html

 

With the reservations stated above, I have a feeling that the evidence for causality between the exposure and damage was very weak and that the likely outcome would have been more legal fees and the same financial end result for the community.

 

Big corporations have a lot of power (a strong argument can be made for corporate cronyism) but legal short cuts may not be the best way to right the situation.

 

In terms of moral hazard, as mentioned before on this thread, a facilitated piercing of the corporate veil in criminal cases may go a long way for environmental protection and other areas because people, even managers, usually don't like to go to prison. I'm told the environment is more toxic than in the Refinery Row districts, especially on your side of the border, apparently.

 

[LC]

Then do you expect the fines for the violations to be proportional to the profitability of the corporations and do you expect that automatically someone will guess how much should be distributed to people who were diagnosed with cancers?

Fines absolutely should be proportional. Hell, if I'm Citgo, I'd do the exact same thing over and over! At this point, do they even have to stop? The fine may even be cheaper than proper treatment.

 

In terms of lawsuit claims, harmed individuals should show damages. Not very different from an asbestos claim.

 

I have a feeling that the evidence for causality between the exposure and damage was very weak and that the likely outcome would have been more legal fees and the same financial end result for the community.

 

Big corporations have a lot of power (a strong argument can be made for corporate cronyism) but legal short cuts may not be the best way to right the situation.

 

I don't think I understand your point. As I understand it, the issue here is the judge did not even allowing these people to explore a causal link. The "legal shortcut" here is doing nobody any favors (except Citgo).

[Cigarbutt]

You are correct in saying that these are tough issues. Jumping to conclusions can be a risky proposition.

 

Your mention of asbestos exposure is interesting.

I've followed this topic closely, including because I have invested in insurance companies whose results were somewhat dependent on the "social" evolution of case law.

 

From a few days ago:

https://nypost.com/2018/04/16/critics-say-tort-reform-necessary-after-60m-asbestos-settlement/

 

Very sad case and, on the surface, it looks like an "award" was indicated by the facts of the case.

However, the entire area of asbestos exposure liability (inclusion criteria, level of settlements) suggests that tort reform may be necessary.

 

Reform is necessary when there is not enough and when there is too much.

We just have to push in the right direction.

Combining heads may help. :)