Corporations Are Not People: Why They Have More Rights Than You Do and What You Can Do About It (22 page)

The constitution of Delaware, the state in which most of the largest corporations get their corporate charter, requires that corporate charters be subject to revocation if they have been misused or abused. Criminal acts are considered misuse and abuse under the law.
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Virtually every state has corporate charter revocation laws because those who came before us recognized the danger of
misuse of the advantages of incorporation and took seriously the public obligation to oversee the conduct of corporations. In our amoral age of corporate law and the careless transformation of corporations into metaphorical people or speakers, the charter revocation laws are widely ignored. This lack of responsibility and accountability helped create the environment in which the Powell-Chamber of Commerce campaign to transform corporations into holders of constitutional rights could succeed, and makes that success all the more dangerous.

The global oil giant BP illustrates like no other the lack of public accountability and control over the giant transnational corporations that now dominate so much of our lives. BP is a web of corporations. The corporation was founded in the United Kingdom as British Petroleum in 1909. The parent corporation is now called BP plc and maintains its headquarters in London. BP operates in the United States through numerous subsidiary corporations that have been granted corporate charters under Delaware law. These include BP America, BP America Production Company, BP Products North America, BP Corporation North America, BP Exploration (Alaska) Inc., BP West Coast Products, Standard Oil, BP Amoco Chemical Company, and more.

On April 20, 2010, BP’s Deepwater Horizon oil rig in the Gulf of Mexico exploded and sank, killing eleven people. The resulting massive oil inundation into the Gulf waters created an environmental and economic catastrophe for people living and working in and along the Gulf. BP has concealed, evaded, or misrepresented the facts about the amount of oil that has poured into the Gulf. Even when scientists implored BP to allow them to monitor the flow of oil that created massive underwater plumes, BP stonewalled: “The answer is no to that. We’re not going to take any extra efforts now to calculate flow there at this point.”

A criminal investigation is under way relating to a whistle-blower disclosure that BP violated the law by not retaining key safety documents about the Deepwater Horizon oil rig. As BP tried to shift the blame and evade accountability, BP’s CEO Tony Hayward whined, “I want my life back.”

BP’s reckless and illegal activity in American waters in the Gulf was only the latest of its crimes. On one day alone in October 2007, BP admitted to a virtual crime spree. First, BP Products North America Inc. pleaded “guilty to a felony” for causing a 2005 refinery explosion in Texas that killed fifteen people. BP admitted, “If our approach to process safety and risk management had been more disciplined and comprehensive, this tragedy could have been prevented.” The criminal plea agreement required BP to pay a fine of $50 million and serve three years of probation.

Second, on the same day, BP admitted that it engaged in criminal conduct that caused “the largest oil spill ever to occur at Prudhoe Bay” in Alaska. As a result, BP Exploration Alaska Inc. pleaded guilty to a misdemeanor violation of the Federal Water Pollution Control Act. BP’s plea agreement required BP to serve three years’ probation and pay a fine of $12 million. BP admitted that its approach to “risk” was “not robust or systematic enough.”

Third, BP also admitted that it engaged in criminal conspiracy, mail fraud, and wire fraud after BP America and several other BP subsidiary corporations “manipulated the price of February 2004 TET physical propane and attempted to manipulate the price of TET propane in April 2003.” As a result of BP’s criminal price manipulation, BP was required to pay $303.5 million in fines, penalties, and restitution. BP admitted that its “view of the legality of these trades changed as our knowledge of the facts surrounding them became more complete.” BP admitted its “failure to adequately oversee our trading operations.”

And these crimes by BP were not the first and not the last. BP’s other recent admissions or convictions of crimes and misdemeanors include the following:

A guilty plea in Alaska related to the illegal disposal of hazardous waste, including paint thinner and toxic solvents containing lead, benzene, toluene, and methylene chloride, on Alaska’s North Slope

$25 million in penalties in California due to “significant and numerous violations” at a BP refinery

$900,000 in penalties after producing and distributing gasoline that threatened public health

$87, 430,000 in proposed penalties to BP Products North America Inc. “for the company’s failure to correct potential hazards faced by employees.” OSHA found that despite the death of 15 people and the injury of 170 in its Texas oil refinery explosion and despite its promises to change its ways, BP continued to commit “hundreds of new violations”

$3 million in additional fines to BP North America when OSHA “found that BP often ignored or severely delayed fixing known hazards in its refineries”

Thirteen “serious safety violations” at a BP refinery near Blaine, Washington. A Washington official stated in 2010 that “we are disturbed that more than ten years after the explosion that killed six workers at the Equilon refinery, our inspectors are still finding significant safety violations every time we inspect one of the refineries in the State of Washington.”

BP’s oil refinery operations account for 97 percent of all “egregiously willful” and “willful” violations found by government safety inspectors over the past three years. Despite (or perhaps because) of this record of crime and misdeeds, in the first quarter
of 2010 alone, BP made $5.6 billion in profit. And what happened to Tony Hayward, the CEO who wanted his life back after BP ruined the Gulf of Mexico and killed workers on the Deepwater Horizon? BP gave him a salary and bonus of $6 million in 2010 and awarded him $18 million when he left the company.

In June 2010, an organization called Green Change filed a petition requesting that the attorney general of Delaware initiate an action to revoke the Delaware charters of BP, a serial criminal. More than five thousand people joined the call.
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A year later, the attorney general has not responded to or commented on the detailed petition describing BP’s crimes, let alone taken action.
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We have had plenty of corporate “fraud, immorality, and violations of law” warranting charter revocation proceedings. We have not had nearly enough action by attorneys general and other state officials to enforce this law.

Large corporations defy even mild controls of health, environmental, and consumer protection laws and then seek shelter from the Supreme Court’s corporate rights regime. Not long before
Citizens United,
the corporate “speech” campaign reached the point of claiming the right of corporations to lie, or at least to have the constitutional right of “breathing space” to protect them from charges of lying.

A California law allowed people to bring consumer fraud charges alleging that Nike fraudulently launched a campaign of lies about why no shoes were made in America anymore and whether Nike’s shoes were made by badly exploited poor people in brutal overseas sweatshops. Nike went all the way to the Supreme Court arguing that the transnational corporation had a “free speech right” to block the law. Again, the global corporations and
corporatist “legal foundations” rallied to the cry that corporations are people, and the Constitution prevents any restriction on corporate “speech.”

Covington & Burling (remember them from the cigarette child-targeting and Monsanto drug-created milk cases on
pages 44
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46
?) filed briefs for ExxonMobil, Microsoft, Morgan Stanley, and Glax-oSmithKline to support “corporate speakers’” First Amendment rights to block laws holding corporations accountable for massive deceptive disinformation campaigns. Covington & Burling wrote, “If a corporate speaker must limit its factual statements on matters of public concern to statements that no one could possibly challenge, or that the speaker could be certain it could prove as ‘true’ in a court of law or before a regulatory body, the result will be a deterrence of speech which the Constitution makes free.”
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The Washington Legal Foundation brief went straight to the heart of the matter: the Court should not allow anything that might cause the corporate share price to fall. Washington Legal Foundation, one of the largest of the Powell-Chamber-inspired corporatist legal groups, argued that a corporation must be able to block a law like California’s or otherwise it would risk a “shareholder suit alleging negligence for the drop in stock values resulting from its failure to defend itself in the court of public opinion.”