Academic journal article Harvard Journal of Law & Public Policy

In Defense of Corporate Criminal Liability

Academic journal article Harvard Journal of Law & Public Policy

In Defense of Corporate Criminal Liability

Article excerpt

Corporations move like poltergeists through our material world: We register their presence by the tangible evidence of their actions, whether it be the construction of a manufacturing facility, the termination of employees, or the sponsorship of a sporting event. And yet corporations are regarded as more than mere ghosts. Like the actions of a corporeal person, the conduct of a corporation has consequences, and so we believe the law should set similar limits on the behavior of each. Indeed, it has become commonplace for federal and state governments to seek to impose criminal liability upon corporations for their actions in such areas as tax, securities, antitrust, insurance and environmental law.

Notwithstanding the ubiquity of federal and state corporate criminal liability regimes,(1) there has been surprisingly little studied consideration by American jurists and legal commentators of the raison d'etre for corporate criminal liability.(2) Critics of corporate criminal liability have recently sought to correct this oversight. In his article, Corporate Criminal Liability: What Purpose Does It Serve?,(3) Professor V.S. Khanna concludes, on efficiency grounds, that corporate criminal liability in fact serves no purpose whatever: "After all," Khanna writes, "corporations cannot be imprisoned," and "it is not clear that corporate criminal liability is the best way to influence corporate behavior."(4) And in their essay, Corporate Crime, Professors Daniel R. Fischel and Alan O. Sykes likewise conclude that, because corporations cannot be imprisoned, criminal liability ultimately "is inferior as a practical matter to an appropriate corrective on the civil side."(5)

In response, I suggest that these critics of corporate criminal liability may be incorrect--that corporate criminal liability is not without purpose. The problem lies in a foundational premise of the critics' arguments: By centering the case for eradicating corporate criminal liability exclusively upon its asserted inefficiency as a deterrent to unlawful acts, Khanna, Fischel, and Sykes overlook retribution as a normative basis for criminal liability and accordingly fail fully to appreciate that, even in the corporate context, moral condemnation remains a valid aim of the criminal law. Indeed, the attributes of modern corporate existence support the argument that corporations, like individuals, can and should be morally condemned for actions that transgress the law.

This Essay proceeds thus: In Part I, after briefly visiting the history of corporate criminal liability, I review the arguments made by the critics who regard corporate civil liability as superior to criminal liability in terms of social desirability. In Part II, I suggest that, in associating social desirability exclusively with efficient deterrence, Khanna, Fischel, and Sykes slight the retributive rationale for criminal liability. To provide a framework for analysis, I sketch Kantian and expressive retributive theories of criminal liability. This leads to a discussion in Part III of the applicability of these retributive theories in the corporate context. I argue that corporations are susceptible to expressive retributive concerns because they have independent identities in the community, based upon attributes--identifiable personae and a capacity to express moral judgments--that substantively distinguish them from their owners, managers and employees. In Part IV, I address the question whether the goals of expressive retribution in the corporate context can be duplicated by civil liability regimes. Concluding that civil liability cannot capture the retributive concerns of criminal liability, I argue in Part V that corporations should continue to be subject to the same dictates that the community imposes upon individuals insofar as criminal conduct is concerned.

I.

At the time of the framing of the United States Constitution, private corporations lurked at the periphery of the American commercial landscape, and corporations did not share in the rights and liberties the Constitution promised natural citizens. …

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