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Corporate Criminals and Punishment Theory

Published online by Cambridge University Press:  02 February 2016

Sylvia Rich
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Abstract

Corporations are subject to criminal law and sentencing provisions in most legal jurisdictions in the world. This article considers how leading punishment theories apply to corporations. Corporations are, this article argues, group agents with the capacity to make moral judgments. It follows from this that retributivism, the dominant theory of punishment for moral agents, ought to be understood as a component justification of corporate punishment. However, a more fundamental problem arises in the attempt to apply punishment theory to corporations: punishment involves suffering, and corporations cannot suffer in the relevant sense. This means that corporations cannot be punished, though they can be harmed. I explore the possibilities of simply abandoning the word ‘punishment’ and creating sentences that are not at the same time punishments. This has the drawback of limiting what the criminal law can accomplish when it comes to addressing corporate malfeasance. I find that at least one practical consequence for corporate sentencing follows from this theoretical distinction: sentencers have more legitimate authority to raise upper limits for sentences for corporations than they do for individuals, though there are still principles that dictate the need for upper limits. Despite the impossibility of true punishment, the theories of retributivism, deterrence and rehabilitation are still relevant when sentencing corporations.

Type
Research Article
Information
Canadian Journal of Law & Jurisprudence , Volume 29 , Issue 1 , February 2016 , pp. 97 - 118
Copyright
Copyright © Canadian Journal of Law and Jurisprudence 2016 

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References

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2. While this article will not explore the alternative sanctions that are available for corporations, I draw the reader’s attention to such possibilities as probation (with a court-appointed compliance officer), adverse publicity, corporate reorganization and others, discussed in these sources: French, Peter A et al, Corporations in the Moral Community (Fort Worth: Harcourt Brace Jovanovich, 1992) at 103–04Google Scholar; Etzioni, Amitai, ‘The U.S. Sentencing Commission on Corporate Crime: A Critique’ in Croall, Hazel, ed, Corporate Crime (London: SAGE, 2009) at 212–13;Google Scholar Brent Fisse & John Braithwaite, ‘The Allocation of Responsibility for Corporate Crime: Individualism, Collectivism and Accountability’ (1988) 11 Sydney L Rev 468 at 490-92; Croall & Ross, supra note 1 at 536-43.

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5. See, e.g., Assaf Hamdani & Alon Klement, ‘Corporate Crime and Deterrence’ (2008-09) 61 Stan L Rev at 271 at 273 (this article also indicates that this is as distinct from the justifications for other sorts of criminalization); Archibald, Todd L, Jull, Kenneth E, & Roach, Kent W, Regulatory and Corporate Liability: From Due Diligence to Risk Management, (Aurora: Canada Law Book, 2005) at 369;Google Scholar Michael G Faure, ‘Effective, Proportional and Dissuasive Penalties in the Implementation of the Environmental Crime and Ship-source Pollution Directives: Questions and Challenges’ (2010) European Energy and Environmental L Rev 256 at 259; Pamela H Bucy, ‘Corporate Ethos: A Standard for Imposing Corporate Criminal Liability’ (1990-91) 75 Minn L Rev 1095 at 1096.

6. RA Duff, ‘Penal Communications: Recent Work in the Philosophy of Punishment’ (1996) 20 Crime and Justice 1 at 1-2.

7. Ibid at 2.

8. Deterrence is often cited as the sole reason for corporate criminal statutes, see for instance Geraldine Szott Moohr, ‘An Enron Lesson: The Modest Role of Criminal Law in Preventing Corporate Crime’ (2003) 55 Florida L Rev 937 at 953-54. There are exceptions to this, notably Schlegel, Kip, Just Deserts for Corporate Criminals (Boston: Northeastern University Press, 1990)Google Scholar but also some other less in-depth discussions such as Brent Fisse, ‘Reconstructing Corporate Criminal Law: Deterrence, Retribution, Fault, and Sanctions’ (1983) 56 Cal L Rev 1141 at 1183 and others cited below.

9. E.g., Alan C Michaels, ‘Fastow and Arthur Andersen: Some Reflections on Corporate Criminality, Victim Status, and Retribution’ (2004) 1 Ohio St J Crim L 551 and Hamdani & Klement, supra note 5; however it is worth noting that both of these articles are written in the US context, which has idiosyncratically broad rules concerning corporate criminal fault.

10. For example, Amy J Sepinwall writes, ‘in the wake of the BP oil-rig explosion, which led to the deaths of eleven rig workers as well as untold damage to the Gulf of Mexico, the public has demanded not just that BP executives be prosecuted for involuntary manslaughter but also that the corporation itself receive a “death sentence,”’ ‘Guilty by Proxy: Expanding the Boundaries of Responsibility in the Face of Corporate Crime’ (2011-12) 63 Hastings LJ 411 at 418); also Samuel W Buell, ‘The Blaming Function of Entity Criminal Liability’ (2006) 18 Ind LJ 473 at 519, on the ‘popular taste for entity criminal liability’.

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15. See arguments discussed in §2(b) below.

16. Sally S Simpson & Christopher S Koper, ‘Deterring Corporate Crime’ (1992) 30 Criminology 347 at 349 find that ‘the evidence in support of deterrence is equivocal’. Similarly Dorothy Thornton et al, ‘General Deterrence and Corporate Environmental Behavior’ (2005) 27 Law & Pol’y 262 at 282, conclude that there is ‘weak support’ for corporate deterrence within the regulatory landscape.

17. And of course, for those who believe that a corporation is more like a car than like an agent (see, e.g., Albert W Alschuler, ‘Two Ways to Think About the Punishment of Corporations’ (2009) 46 Am Crim L Rev 1359 at 1373) then the imposition of criminal liability on them is a misunderstanding or misdirection.

18. Philip Pettit, ‘Responsibility Incorporated’ (2007) 117 Ethics 171 at 181.

19. Philip Pettit, ‘Collective Persons and Powers’ (2002) 8 Legal Theory 443 at 452.

20. Ibid at 456.

21. Ibid at 459.

22. Pettit, supra note 18.

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24. Michael McKenna, ‘Collective Responsibility and an Agent Meaning Theory’ (2006) 30 Midwest Studies in Philosophy 16 at 26-27.

25. Wolgast, supra note 11 at 86.

26. List, Christian & Pettit, Philip, Group Agency: The Possibility, Design and Status of Corporate Agents (Oxford: Oxford University Press, 2011) at 32.CrossRefGoogle Scholar

27. This is something that many jurists who are not group theorists also acknowledge: see, e.g., Kelsen, Hans, General Theory of Law and State, translated by Wedberg, Anders (New York: Russell & Russell, 1961) at 104.Google Scholar

28. May, Larry, The Morality of Groups (Notre Dame: University of Notre Dame Press, 1987) at 101–02.Google Scholar

29. Ibid at 102.

30. Ibid.

31. Ibid at n 44.

32. William S Laufer & Alan Strudler, ‘Corporate Intentionality, Desert, and Variants of Vicarious Liability’ (2000) 37 Am Crim L Rev 1285 at 1286, n 10.

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37. Katherine Beaty Chiste, ‘Retribution, Restoration, and White-Collar Crime’ (2008) 31 Dalhousie LJ 86 at 89.

38. Schlegel, supra note 8 at 71.

39. See, e.g., Milton Friedman, ‘The Social Responsibility of Business is to Increase its Profits’ The New York Times Magazine (13 September 1970).

40. Wolgast, supra note 11 at 86-87; Bakan, Joel, The Corporation: The Pathological Pursuit of Profit and Power (Toronto: Viking Canada, 2004) at 68.Google Scholar

41. ‘BP Will Plead Guilty and Pay Over $4 Billion’ New York Times (15 November 2012), online at: http://www.nytimes.com/2012/11/16/business/global/16iht-bp16.html?_r=0, last accessed 30 November 2015.

42. This understanding of harm relies on the analysis in Feinberg, Joel, The Moral Limits of the Criminal Law, Vol. 1: Harm to Others (Oxford: Oxford University Press, 1987) at ch 1.Google Scholar

43. Joel Feinberg disagrees and says that the harm is to the owner of the plants; however, in finding that harms relate to entities having interests, Feinberg should also agree that corporations can be harmed, even if plants cannot be, ibid at 32-34.

44. This view is espoused by HLA Hart, among others: Punishment & Responsibility: Essays in the Philosophy of Law, 2d ed (Oxford: Oxford University Press, 2008) at 4. It is important to note however that Hart found that central cases of punishment must involve ‘pain or other consequences normally considered unpleasant.’ I read pain as equivalent to suffering but do note that Hart offered the alternative ‘normally considered unpleasant.’

45. JD Mabbott, ‘Professor Flew on Punishment’ (1955) 30 Philosophy 256, 257-58; Alan Brudner similarly espouses the view that deprivation of liberty is an alternative form of punishment to the imposition of suffering, supra note 13 at 53.

46. Joel Feinberg, ‘The Expressive Function of Punishment’ (1965) 49 The Monist 397 at 400.

47. Bill Wringe, ‘Must Punishment Be Intended to Cause Suffering?’ 2013 16 Ethic Theory Moral Prac 863 at 867. Note that Wringe is not trying to differentiate between suffering-inducing and burdensome treatment, but argues there is something important in the fact that the treatment imposed is of a generally burdensome type rather than being specifically tailored to be burdensome to the individual before the court.

48. David Gray, ‘Punishment as Suffering’ (2010) 63 Vand L Rev 1617 at 1622.

49. Ibid.

50. Wringe, supra note 47 at 875.

51. It may seem unpalatable to the reader to think of parents wanting their children to suffer. But it does seem that if parents are acting punitively, then they are attempting at least to have their children feel some sort of sting of suffering in order to aid them in understanding how wrongful their conduct was. There are certainly other ways to parent, but those other ways do not include punishments.

52. Wringe, supra note 47 at 868-74.

53. Tracy Isaacs, ‘Corporate Agency and Corporate Wrongdoing’ (2013) 16 New Crim L Rev 241 at 254: ‘If we consider punishment to be a retributive response to an act of wrongdoing, then they are not being punished even if they are suffering negative consequences as a result of someone else’s punishment.’

54. May, supra note 28 at 103.

55. Gilbert, Margaret, ‘Collective Remorse’ in Jokić, Aleksandar, ed, War Crimes and Collective Wrongdoing: A Reader (Malden: Blackwell, 2001) at 229.Google Scholar

56. Angelo Corlett, J, Responsibility and Punishment, 3d ed (Dordrecht: Springer, 2009) at 170.Google Scholar

57. See RA Duff, ‘In Defence of one Type of Retributivism: A Reply to Bagaric and Amarasekara’ (2000) 24 Melbourne UL Rev 411.

58. Duff, Antony, ‘Punishment, Communication and Community’ in Matravers, Derek & Pike, Jon, eds, Debates in Contemporary Political Philosophy: An Anthology’ (London: Routledge, 2003) at 394.Google Scholar

59. Bill Wringe, ‘Collective Agents and Communicative Theories of Punishment’ (2012) 43 Journal of Social Phil 436 at 438.

60. Ibid at 444.