Me, Inc.

Cecil's Columns/Staff Reports
1

In his column on corporate personhood , Cecil muses that a ruling against the concept might support the idea that limits on corporate political contributions don’t violate the First Amendment. Well and good, but does one need a corporate person to generate a First Amendment issue here?

Most public corporations have governing boards that are, at least in theory, elected by the shareholders (even though those of us who never pass up a chance to toss a proxy ballot in the trash may know better). Given such a reasonable facsimile of representative democracy, couldn’t the argument be made that restricting corporate political contributions infringes the First Amendment rights of the corporate board that oversees them, and by extension of the corporation’s shareholders? That’s a large class of real people with First Amendment rights to be violated. No need for quasi-fictitious corporate people.

2

Right, but those people can still exercise their First Amendment rights on their own. The rights of the corporation as a separate legal person could still be restricted. The board and shareholders don’t make up the corporate person, the corporate person is a separate entity from the shareholders altogether.

3

Good point. I had misremembered that, for instance, corporate officers and shareholders can’t be held liable as individuals for actions of the corporation.

But that raises another question: if there isn’t a “corporate person,” couldn’t that protection – almost dating back to common law – be lost?

Argument 1

A: The corporation, qua corporation, is a person with rights equivalent to other kinds of persons, ergo it has First Amendment rights.

B: No, it’s not a person and so has no First Amendment rights.

Argument 2

A: A corporate person can be sued for corporate acts, just as other kinds of persons can be sued.

B: No it can’t, the corporation isn’t a person so it can’t be sued. You’d have to try to sue the officers or shareholders instead.

The whole Nike thing is pretty intriguing, too. It’s sort of a reverse SLAMM suit. Businesses have been suing activists over “restraint of trade” connected to their speech for some time; now comes an activist who wants to haul a corporation into court for “commercial speech” connected with its public relations activities. As a PR practitioner, I’m down on Nike at the moment for settling. Who’d want to do (or hire people to do :wink: )PR if all it’s going to do is cost you money for legal settlements?

4

That’s not exactly true. There are piercing the corporate veil possibilities. And, there are shareholder derivative suits, as well as actions by the SEC, etc.

And, a quick point, corporate persons do not have all of the rights of real persons. For example, they cannot vote, and (I believe) they do not have the privledge against self incrimination. There are a few more of them as well.

5

Sure, but there are lots of ways that a corporate person is different from a natural person. You mentioned above that commercial speech is different than personal speech, and has been restricted in various ways. Also, a corporate person cannot vote in an election, cannot go to jail, and I’m sure there are many other things a corporate person can or cannot legally do that is different from a natural person. Those differences don’t automatically strip away all rights from a corporate person, just some rights.

6

As I see it, the question is not why\how are Corporations afforded the same rights as real humans, the question is why do they have NONE OF THE RESPONSIBILITY?

THAT is the thing that irks me about this policy. Just think about it. If I, a private citizen, were to go upstream from a town and start dumping raw sewage into their primary water source, to the point they were forced to build a new treatment plant (with taxpayer money) to deal with the problem, I would be put in jail for years. And if anyone got sick and died? I’d be up on negligent homicide charges and not see the light of day again for most of my life.

But Corporations do this all the time. What’s the worst that happens to them? They get fined an amount that is a small fraction of their profits, and quite often, a fee that’s LESS than it would cost them to upgrade and stop polluting! They are, going by the bottom line, REWARDED for destructive criminal behavior.

I say, if Corporations get all the legal protections of the People, then they get all the punishments too. A corporation screws up, causes pain and destruction? Suspended from stock trading for years equal to the human jail sentence. Deliberately and knowingly allowing for deaths and massive damages? A corporate Death sentence - total dissolution and State seizure of all assets.

7

Wizard, why would that be effective? You seem to misunderstand that a corporation is a legal fiction. It is human beings who make decisions and take actions, and who must accept responsibility. Remember that a corporation is generally comprised of very few people who make decisions, and very many who follow them. It is really the former who ought to be punished, yet your prescription would damage everyone in the corporation equally (think of the Enron secretaries whose 401(k)s were zeroed out when the common stock was wiped out in bankruptcy).

8

Here’s another way that a corporations do not have the same rights as “real” people. A corporation cannot marry another consenting corporation of the same gender, whereas… oh, wait. Sorry. Disregard.

9

<b>OxyMoron</b>

I understand completely, thank you. Is the accountant for a mob boss blameless? Is the man who hires a hitman not, himself, guilty of murder?

I reject the concept that people involved in a corporation are blameless. Lots of people in Enron knew what was going on, or at least knew some very bad things were happening, yet no one spoke up, and very few quit over it. They chose to stay with a company they knew to be flagrantly breaking the law, and I see no reason they should be held unaccountable for it.

And the stockholders? They’re what drive the entire situation. Stockholders say to a company, “Here is some money. Go make us more money. We don’t care how you do it, nor do we want to know.” Corporations pander to the stockholders like royalty, and are now at the point where most are solely concerned with increasing the stock value. NOT with producing a viable product/service. It’s a perversion of economics.

I say, if you choose to invest in a company, then you are accepting responsibilty for its actions. Is this “unfair” to someone who blindly bets on whatever stock is rising at the moment? ABSOLUTELY! Because that person is part of the problem. If you believe in a company enough to invest in it, then you should have enough interest to follow its comings and goings to make sure it’s behaving in a legal fashion.

If the company, in my hypothetical setup, lies or grossly misrepresents itself to its stockholders, THEN the Chief Operators are solely responsible. If the company is being upfront about its actions, and publishing clear reports on them, then the blame is shared by all who know what they are doing.

Just like blame for a murder is shared with whoever paid the assassin.

And, at any rate, your counterpoint is a non-sequitor. I asked why a corporation has all the rights of a human, but none of the responsibilities. These two concepts, in society, go hand in hand. It’s one of the most basic ideas of the Social Contract, one of the core philosophies most Western governments are built up.
So your claim of it being a “legal fiction” is nothing more than a cop-out. You claim that, I claim they have no rights at all. Those rights are nothing but legal fictions too, aren’t they? In other words, you can’t logically have it both ways. So let’s have a system where the government can destroy a corporation on its whim for any reason! Yeah!

I like my idea better. It has cause and effect.

10

One of the great underpinnings of human rights is that the rights are the rights of humans. Humans are mortal. No matter how much an individual human may abuse or stretch what is allowed to people, that human will eventually be gone, thus eliminating the abuse. Likewise, humans are rather frail. This cannot be said of corporations. If corporations are willing to accept mortality and frailty comparable to an ordinary human being, then, and only then, do they deserve “rights”.

11

Natural persons don’t have the right to vote, either. And I don’t see how a corporation could be called to testify against itself. But I do wonder why the income taxes differ between the two, if they are considered to have the same rights.

12

What country are you living in?

13

I apologize in advance for getting all technical, but in this case I think the “technicality” I’m gonna discuss is the source of some of the confusion in the threads about the column.

The Santa Clara case deals with whether a corporation is a “person” for purposes of the equal protection clause of the 14th Amendment of the US Constitution. Cecil’s catchy headline, “How can a corporation be legally considered a person?” doesn’t bother with the details of which part of “legally” we’re dealing with, but the column does cover it.

There’s really no debate over whether a corporation can be sued for corporate acts: it can. The state corporation statutes which authorize the creation of corporations specifically permit corporations to “sue and be sued.” This includes both civil and criminal suits (there are interesting issues around some of the attempts to hold corporations liable for criminal acts too). The status of a corporation established in this manner by state statute, with the rights/powers as provided in the state statute, is what people mean when they say the corporation is an “artificial person.”

Corporations are subject to the laws, including environmental rules, and can be required to pay fines and civil judgments which could bankrupt them and force them to cease operations. Corporations can be dissolved by the courts if they are bankrupt or have committed certain statutorily fraudulent actions. Stock exchanges can and do de-list companies from trading. Individual corporate officers and directors may also be charged with criminal violations of the law. It is harder to sue officers and directors civilly for acts taken for the corporation because they are protected by the business judgment rule, but even this is no defense if they act in their own interests. WizardX seems to be advocating for the elimination of all corporations, which he is of course permitted to do–this would also, however, eliminate the benefits of corporate structure.

The issue in Santa Clara relates solely to whether corporations are persons for purposes of the equal protection clause, which has pretty much nothing to do with corporate oppression. If the Supremes jump up on their bench tomorrow and denounce that scoundral Bancroft Davis will the citizens suddenly be safe from corporate excess? No. The questions about whether corporations have free speech rights are interesting, but the “right” answer will not give us kinder and gentler corporations.

14

It is sort of amusing that the legal fiction of corporate personhood, i.e. that a corporation can conduct business in its own name, as well as sue and be sued in it own name, has turned into this common misconception that corporate status is responsible for all of the evils of business.

Were one inclined, you could argue that “innocent until proven guilty” is the reason for so much crime in America. Or, while we’re at it, the exclusionary rule in evidence. Hell, just give America to criminals with that attitude.

Weighing in on Corps getting XIVth Amendment protection, I think that is mostly to keep the rights of real persons (i.e. the directors, etc.) from being completely overrun, and not so much to do with honoring the Corporation’s personhood.

15

The US.

16

And you’re saying that natural persons in the U.S. don’t have the right to vote?!

17

There in no provision in the Constitution which states that natural persons have the right to vote. Of course, if some are allowed, and others not, that may be an equal protection violation.

18

I’m presuming that the discussion between The Ryan and tracer is the difference between “natural persons” and “citizens” (broadly)?

19

WizardX:

Got a cite, pally?

20

I have the right to vote.

http://www.legis.state.il.us/commission/lrb/con3.htm

It even uses that phrase, “the right to vote.” Ah, the State Constitution. The wonders it holds will never cease.

Maybe your state has one too?