# MF Global parent being sued on behalf of child (corporate personhood) **URL:** \ **Category:** Great Debates\ **Created:** [February 16, 2012, 11:43pm UTC](https://boards.straightdope.com/t/mf-global-parent-being-sued-on-behalf-of-child-corporate-personhood/613077 "2012-02-16T23:43:05Z")\ **Posts on this page:** 20\ **Page:** 1
**Author:** ![Linden\_Arden](https://avatars.discourse-cdn.com/v4/letter/l/53a042/32.png) [@Linden\_Arden](https://boards.straightdope.com/u/Linden_Arden)\ **Post date:** [February 16, 2012, 11:43pm UTC](https://boards.straightdope.com/t/mf-global-parent-being-sued-on-behalf-of-child-corporate-personhood/613077/1 "2012-02-16T23:43:05Z")
[http://www.timesunion.com/business/press-releases/article/Corporate-Personhood-Issue-in-MF-Global-3332512.php#ixzz1mYbdE8wV](http://www.timesunion.com/business/press-releases/article/Corporate-Personhood-Issue-in-MF-Global-3332512.php#ixzz1mYbdE8wV) > [@](#): > > The Furgatch Motion asserts that because the U.S. Supreme Court has ruled that corporations are to be treated as “persons,” then the “parent” company, MF Global Holdings, by definition, must have a “child” company, MF Global, Inc., the subsidiary brokerage whose customers are still missing at least $1.2 billion in segregated funds. The filing then cites clear, specific statutes in the Bankruptcy Code that mandate that a child’s support claims shall have super-priority status over all other unsecured creditors. This seems like it could be a credible challenge to the notion of corporate personhood. The ramifications of this case could be huge. I don’t know if the corporate person concept has been challenged before but it seems the argument by the creditors would have to be straight out denial. I don’t have a strong bias but I side with Mr. Furgatch against the creditors. Will this work? ---
**Author:** ![Terr](https://avatars.discourse-cdn.com/v4/letter/t/839c29/32.png) [@Terr](https://boards.straightdope.com/u/Terr)\ **Post date:** [February 16, 2012, 11:55pm UTC](https://boards.straightdope.com/t/mf-global-parent-being-sued-on-behalf-of-child-corporate-personhood/613077/2 "2012-02-16T23:55:12Z")
> [@Linden\_Arden](#): > > [http://www.timesunion.com/business/press-releases/article/Corporate-Personhood-Issue-in-MF-Global-3332512.php#ixzz1mYbdE8wV](http://www.timesunion.com/business/press-releases/article/Corporate-Personhood-Issue-in-MF-Global-3332512.php#ixzz1mYbdE8wV) > > This seems like it could be a credible challenge to the notion of corporate personhood. The ramifications of this case could be huge. I don’t know if the corporate person concept has been challenged before but it seems the argument by the creditors would have to be straight out denial. > > I don’t have a strong bias but I side with Mr. Furgatch against the creditors. Will this work? The law doesn’t say “corporations are persons in every sense of the word”. ---
**Author:** ![Giles](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/giles/32/60_2.png) [@Giles](https://boards.straightdope.com/u/Giles)\ **Post date:** [February 16, 2012, 11:58pm UTC](https://boards.straightdope.com/t/mf-global-parent-being-sued-on-behalf-of-child-corporate-personhood/613077/3 "2012-02-16T23:58:17Z")
> [@Terr](#): > > The law doesn’t say “corporations are persons in every sense of the word”. And “parent company” is a metaphor: it does not mean a parent (mother or father) as the term is used in family law. ---
**Author:** ![Linden\_Arden](https://avatars.discourse-cdn.com/v4/letter/l/53a042/32.png) [@Linden\_Arden](https://boards.straightdope.com/u/Linden_Arden)\ **Post date:** [February 17, 2012, 12:02am UTC](https://boards.straightdope.com/t/mf-global-parent-being-sued-on-behalf-of-child-corporate-personhood/613077/4 "2012-02-17T00:02:57Z")
> [@Terr](#): > > The law doesn’t say “corporations are persons in every sense of the word”. Is there a law? I thought there was not. Personhood is merely a SCOTUS invention. I could well be mistaken. ---
**Author:** ![Giles](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/giles/32/60_2.png) [@Giles](https://boards.straightdope.com/u/Giles)\ **Post date:** [February 17, 2012, 12:04am UTC](https://boards.straightdope.com/t/mf-global-parent-being-sued-on-behalf-of-child-corporate-personhood/613077/5 "2012-02-17T00:04:40Z")
I’d add that I could imagine a legal system in which corporations could be adoptive or foster parents, even though they can’t be natural parents. However, I can’t imagine why you would want a corporation treated as a child in family law. ---
**Author:** ![robert\_columbia](https://avatars.discourse-cdn.com/v4/letter/r/e79b87/32.png) [@robert\_columbia](https://boards.straightdope.com/u/robert_columbia)\ **Post date:** [February 17, 2012, 12:05am UTC](https://boards.straightdope.com/t/mf-global-parent-being-sued-on-behalf-of-child-corporate-personhood/613077/6 "2012-02-17T00:05:46Z")
> [@Linden\_Arden](#): > > [http://www.timesunion.com/business/press-releases/article/Corporate-Personhood-Issue-in-MF-Global-3332512.php#ixzz1mYbdE8wV](http://www.timesunion.com/business/press-releases/article/Corporate-Personhood-Issue-in-MF-Global-3332512.php#ixzz1mYbdE8wV) > > This seems like it could be a credible challenge to the notion of corporate personhood. The ramifications of this case could be huge. I don’t know if the corporate person concept has been challenged before but it seems the argument by the creditors would have to be straight out denial. > > I don’t have a strong bias but I side with Mr. Furgatch against the creditors. Will this work? Is MF Global, Inc. under 18 years of age or attending college full time? ---
**Author:** ![John\_Mace](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/john_mace/32/185_2.png) [@John\_Mace](https://boards.straightdope.com/u/John_Mace)\ **Post date:** [February 17, 2012, 12:06am UTC](https://boards.straightdope.com/t/mf-global-parent-being-sued-on-behalf-of-child-corporate-personhood/613077/7 "2012-02-17T00:06:19Z")
> [@Linden\_Arden](#): > > Is there a law? > > I thought there was not. Personhood is merely a SCOTUS invention. I could well be mistaken. You are mistaken. This is a joke or a stunt. ---
**Author:** ![Linden\_Arden](https://avatars.discourse-cdn.com/v4/letter/l/53a042/32.png) [@Linden\_Arden](https://boards.straightdope.com/u/Linden_Arden)\ **Post date:** [February 17, 2012, 12:10am UTC](https://boards.straightdope.com/t/mf-global-parent-being-sued-on-behalf-of-child-corporate-personhood/613077/8 "2012-02-17T00:10:13Z")
> [@robert\_columbia](#): > > Is MF Global, Inc. under 18 years of age or attending college full time? That is not the only definition of a child. Children may be much older than 18 and retain the same relationship with their parent. The case is on the docket. If it were that easily dismissed would it be? ---
**Author:** ![Giles](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/giles/32/60_2.png) [@Giles](https://boards.straightdope.com/u/Giles)\ **Post date:** [February 17, 2012, 12:11am UTC](https://boards.straightdope.com/t/mf-global-parent-being-sued-on-behalf-of-child-corporate-personhood/613077/9 "2012-02-17T00:11:46Z")
> [@Linden\_Arden](#): > > Personhood is merely a SCOTUS invention. I could well be mistaken. That corporations are legal “persons” is at the heart of corporate law, and not just a recent invention of the Supreme Court. If they were not legal persons then, for example, if you wanted to sue a manufacturer for making a faulty product that injured you, your legal suit would need to name the officers and shareholders of the corporation, and not just the corporation itself, and you would be trying to recover damages from each of the officers and shareholders. Corporate personality is a very useful device. ---
**Author:** ![Linden\_Arden](https://avatars.discourse-cdn.com/v4/letter/l/53a042/32.png) [@Linden\_Arden](https://boards.straightdope.com/u/Linden_Arden)\ **Post date:** [February 17, 2012, 12:21am UTC](https://boards.straightdope.com/t/mf-global-parent-being-sued-on-behalf-of-child-corporate-personhood/613077/10 "2012-02-17T00:21:34Z")
> [@Giles](#): > > That corporations are legal “persons” is at the heart of corporate law, and not just a recent invention of the Supreme Court. If they were not legal persons then, for example, if you wanted to sue a manufacturer for making a faulty product that injured you, your legal suit would need to name the officers and shareholders of the corporation, and not just the corporation itself, and you would be trying to recover damages from each of the officers and shareholders. Corporate personality is a very useful device. Why this then? > [@](#): > > The Furgatch Motion has been assigned Court Docket #424 in the case of MF Global Holdings Ltd., 11-bk-15059, U.S. Bankruptcy Court, Southern District of New York (Manhattan). Read more: [http://www.timesunion.com/business/press-releases/article/Corporate-Personhood-Issue-in-MF-Global-3332512.php#ixzz1mar6qSDR](http://www.timesunion.com/business/press-releases/article/Corporate-Personhood-Issue-in-MF-Global-3332512.php#ixzz1mar6qSDR) If the motion were frivolous would the bankruptcy court hear it? ---
**Author:** ![Giles](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/giles/32/60_2.png) [@Giles](https://boards.straightdope.com/u/Giles)\ **Post date:** [February 17, 2012, 12:33am UTC](https://boards.straightdope.com/t/mf-global-parent-being-sued-on-behalf-of-child-corporate-personhood/613077/11 "2012-02-17T00:33:08Z")
> [@Linden\_Arden](#): > > If the motion were frivolous would the bankruptcy court hear it? My guess is that this is a new issue, never raised before, about how the word “child” is interpreted in some bankruptcy legislation, so the court has to deal with it. I suspect that a court of first instance (which this one would be) has to deal with issues raised by parties, no matter how frivolous they appear, unless (for example) the party has previously been ruled as a “vexatious litigant”. You get your day in court, but I suspect that’s all the person raising this issue will get. (But IANAL, and certainly not a lawyer practising in the State of New York.) ---
**Author:** ![robert\_columbia](https://avatars.discourse-cdn.com/v4/letter/r/e79b87/32.png) [@robert\_columbia](https://boards.straightdope.com/u/robert_columbia)\ **Post date:** [February 17, 2012, 12:45am UTC](https://boards.straightdope.com/t/mf-global-parent-being-sued-on-behalf-of-child-corporate-personhood/613077/12 "2012-02-17T00:45:20Z")
> [@Linden\_Arden](#): > > That is not the only definition of a child. Children may be much older than 18 and retain the same relationship with their parent. > > The case is on the docket. If it were that easily dismissed would it be? But I thought that the obligation to support a child, at least under US law, was not lifelong, but ended at age 18 or possibly later if the child is attending college full time or is gravely disabled. ---
**Author:** ![robert\_columbia](https://avatars.discourse-cdn.com/v4/letter/r/e79b87/32.png) [@robert\_columbia](https://boards.straightdope.com/u/robert_columbia)\ **Post date:** [February 17, 2012, 12:47am UTC](https://boards.straightdope.com/t/mf-global-parent-being-sued-on-behalf-of-child-corporate-personhood/613077/13 "2012-02-17T00:47:45Z")
> [@Giles](#): > > I’d add that I could imagine a legal system in which corporations could be adoptive or foster parents, even though they can’t be natural parents. However, I can’t imagine why you would want a corporation treated as a child in family law. Now Johnny, we’ve found a new foster home for you. Penn State has agreed to take you in and you will be officially under the care of the college administration. ---
**Author:** ![Giles](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/giles/32/60_2.png) [@Giles](https://boards.straightdope.com/u/Giles)\ **Post date:** [February 17, 2012, 12:53am UTC](https://boards.straightdope.com/t/mf-global-parent-being-sued-on-behalf-of-child-corporate-personhood/613077/14 "2012-02-17T00:53:13Z")
> [@robert\_columbia](#): > > Now Johnny, we’ve found a new foster home for you. Penn State has agreed to take you in and you will be officially under the care of the college administration. That could be better that some real-life foster parents 🙂 ---
**Author:** ![rat\_avatar](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/rat_avatar/32/255_2.png) [@rat\_avatar](https://boards.straightdope.com/u/rat_avatar)\ **Post date:** [February 17, 2012, 1:06am UTC](https://boards.straightdope.com/t/mf-global-parent-being-sued-on-behalf-of-child-corporate-personhood/613077/15 "2012-02-17T01:06:09Z")
> [@robert\_columbia](#): > > Now Johnny, we’ve found a new foster home for you. Penn State has agreed to take you in and you will be officially under the care of the college administration. The state, city, county are all corporations, They do take custody of children although not termed parents the roll as guardian is similar. I am a bit frustrated that the left, who I mostly identify has taken corporate person hood up as their version of the “birther” craze It is good at stirring emotion but if the idea is to overturn the citizens-united ruling it would do nothing to revoke corporate person-hood. Dont take my word for it, the decision is right here [http://www.law.cornell.edu/supct/html/08-205.ZS.html](http://www.law.cornell.edu/supct/html/08-205.ZS.html) To try and simplify the decision the opinion is not “because corporations are people they have a right to political speech” The decision was “individual do not surrender their right to free speech due to the exercise of their right of assembly based on the fact that the form they chose to organize is a fictional entity” It is a huge difference, There are issues with corporate person-hood, but again, if you destroyed the concept of a “fictional person” from our body of law citizen’s united’s ruling would still stand. ---
**Author:** ![Linden\_Arden](https://avatars.discourse-cdn.com/v4/letter/l/53a042/32.png) [@Linden\_Arden](https://boards.straightdope.com/u/Linden_Arden)\ **Post date:** [February 17, 2012, 1:20am UTC](https://boards.straightdope.com/t/mf-global-parent-being-sued-on-behalf-of-child-corporate-personhood/613077/16 "2012-02-17T01:20:33Z")
> [@rat\_avatar](#): > > It is good at stirring emotion but if the idea is to overturn the citizens-united ruling it would do nothing to revoke corporate person-hood. This has nothing to do with Citizens United (a decision which I support anyway). I saw a documentary called ‘The Corporation’ (2003). It is definitely leftish but pre-dated CU by years. > [@](#): > > The documentary shows the development of the contemporary business corporation, from a legal entity that originated as a government-chartered institution meant to affect specific public functions, to the rise of the modern commercial institution entitled to most of the legal rights of a person. One theme is its assessment as a “personality”, as a result of an 1886 case in the United States Supreme Court in which a statement by Chief Justice Morrison R. Waite[nb 1] led to corporations as “persons” having the same rights as human beings, based on the Fourteenth Amendment to the United States Constitution. > **[Corporation (disambiguation)](https://en.wikipedia.org/wiki/The_Corporation_%28film%29)** > > A corporation is a company or group of people authorized to act as a single entity (legal person) and recognized as such in law. Commercial corporations can take many forms, including statutory corporations, corporations sole, joint-stock companies, cooperatives and others. > The term is also part of the expression municipal corporation used only in formal contexts to refer to local governing bodies, although these are not commercial entities. > Corporation may also refer to: ---
**Author:** ![Kobal2](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/kobal2/32/20_2.png) [@Kobal2](https://boards.straightdope.com/u/Kobal2)\ **Post date:** [February 17, 2012, 1:29am UTC](https://boards.straightdope.com/t/mf-global-parent-being-sued-on-behalf-of-child-corporate-personhood/613077/17 "2012-02-17T01:29:52Z")
> [@Giles](#): > > even though they can’t be natural parents. Knowing the interesting mores of certain members of boards of directors I am aware of, it’s not entirely out of the question. ---
**Author:** ![rat\_avatar](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/rat_avatar/32/255_2.png) [@rat\_avatar](https://boards.straightdope.com/u/rat_avatar)\ **Post date:** [February 17, 2012, 1:33am UTC](https://boards.straightdope.com/t/mf-global-parent-being-sued-on-behalf-of-child-corporate-personhood/613077/18 "2012-02-17T01:33:00Z")
> [@Linden\_Arden](#): > > This has nothing to do with Citizens United (a decision which I support anyway). > > I saw a documentary called ‘The Corporation’ (2003). It is definitely leftish but pre-dated CU by years. > > [Corporation (disambiguation) - Wikipedia](http://en.wikipedia.org/wiki/The_Corporation_%28film%29) Sorry I missed half my post on that reply. A limited liability company formed by a parent corp will be treated as if the parent corp were an individual, the law suit is without merit unless someone seriously messed up on the charter. Without the common law “person hood” we would need to establish another type of legal fiction to deal with companies. IMHO the real solution is to hold the state responsible, they have the ability to revoke charters. Not all rights are afforded to corps, there is a lot we can do besides just dreaming what ever new legal fiction they create is better. ---
**Author:** ![RickJay](https://avatars.discourse-cdn.com/v4/letter/r/bb73d2/32.png) [@RickJay](https://boards.straightdope.com/u/RickJay)\ **Post date:** [February 17, 2012, 2:20am UTC](https://boards.straightdope.com/t/mf-global-parent-being-sued-on-behalf-of-child-corporate-personhood/613077/19 "2012-02-17T02:20:53Z")
> [@Giles](#): > > That corporations are legal “persons” is at the heart of corporate law, and not just a recent invention of the Supreme Court. It’s at the heart of basic civil law, period. Treating legally recognized collective entities as “persons” for some legal purposes is something without which a modern society couldn’t function. I don’t think a lot of people realize that not all companies are corporations and not all corporations are for-profit companies. Contrary to popular Internet belief and “The Corporation,” this was not invented in 1886, either. ---
**Author:** ![Linden\_Arden](https://avatars.discourse-cdn.com/v4/letter/l/53a042/32.png) [@Linden\_Arden](https://boards.straightdope.com/u/Linden_Arden)\ **Post date:** [February 17, 2012, 2:46am UTC](https://boards.straightdope.com/t/mf-global-parent-being-sued-on-behalf-of-child-corporate-personhood/613077/20 "2012-02-17T02:46:54Z")
> [@RickJay](#): > > It’s at the heart of basic civil law, period. Treating legally recognized collective entities as “persons” for some legal purposes is something without which a modern society couldn’t function. But the issue here is not the denial of personhood, but the acceptance of such so that a child/subsidiary is protected from outside claims by other parties. [Next page](https://boards.straightdope.com/t/mf-global-parent-being-sued-on-behalf-of-child-corporate-personhood/613077.md?page=2)