BP and Three Executives Facing Criminal Charges Over Oil Spill 238
New submitter SleazyRidr writes "Finally some news that will please a lot of the Slashdot crowd: a company has been charged with manslaughter! BP has been charged with manslaughter following the Macondo Incident. 'BP has agreed to pay $4.5 billion to settle the criminal charges and related Securities and Exchange Commission charges.' Two of the rig supervisors and a BP executive are also facing jail time. The supervisors are charged with 'failing to alert on-shore managers at the time they observed clear signs that the Macondo well was not secure and that oil and gas were flowing into the well,' and the supervisor is charged with 'obstruction of Congress and making false statements to law enforcement officials about the amount of oil flowing from the well.' Is this the start of companies being forced to take responsibility for their actions?"
Corporations are people (Score:5, Insightful)
Who knew that could ever come back and bite them in the ass?
Not really (Score:5, Insightful)
When "BP" has to spend 180 days in prison like a regular person convicted of manslaughter then I'll believe it.
Oh, and I'd want BP to be a registered felon, so no government jobs/contracts, no leaving the country and no crossing state lines without the court's okay.
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Well guess what--BP is currently banned from government contracts. Would you like to add another condition to justify your outrage?
Re:Not really (Score:5, Interesting)
When "BP" has to spend 180 days in prison like a regular person convicted of manslaughter then I'll believe it.
I'd settle for a fine equal to 180 days gross revenue (effectively the same).
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It's only equivalent if the government pays BP's gross expenses for the 180 days as well.
Prison beds, food and water are provided out of the government's budgets, after all. (Even if it's indirectly through a contractor)
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Extending this analogy further, it would be gross expenses at the absolute minimum of remaining operable. In other words, minimal wage paid to a single guy who is the CEO. After all, when the government puts a guy in prison, it doesn't pay for his wife's bills or his car insurance.
Re:Not really (Score:5, Informative)
You got your second wish. The EPA denied BP the right to bid on oil contracts.
http://blog.chron.com/lorensteffy/2012/11/in-suspending-bp-epa-does-what-drilling-regulators-would-not/ [chron.com]
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Too bad. Now BP has to create a proxy to submit bids for them.
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Re:Not really (Score:5, Insightful)
BP is a multinational company, just like every large company that you think is "an American company".
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Yes, the problem is that during the incident, Obama repeatedly referred to them as British Petroleum and exploited the situation for his own political gain by explicitly making it about "foreign" companies by resorting to what all politicians do when they need a popularity boost- resorting to populism and nationalism.
Don't get me wrong, I'm glad Obama won the 2008 election, and I'm glad he won this latest one, but the whole BP incident is one of those few situations where as someone from the UK, I'd rather
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noone insinuated they were an American company or that others would think they were.
There was a statement that they wouldn't have been treated as harshly if they were an American company - which was replied with a statement that all the majors are multinationals and not American so there would be little difference had they originated elsewhere.
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Who knew that could ever come back and bite them in the ass?
Lots of people knew -- it's not like this is anywhere near the first time it's been an issue.
For example, many (most?) states prohibit a felon from owning a liquor license, and when a corporation pleads guilty to a felony -- they lose their license, which can put them out of business if their business is selling liquor.
That said, when Romney made his infamous "corporations are people, my friend" statement, context made it pretty clear that he wasn't talking about the legal status of corporations (even thoug
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"Corporations are people, my friend . . . Of course they are. Everything corporations earn ultimately goes to the people. Where do you think it goes? Whose pockets? Whose pockets? People's pockets. Human beings, my friend."
Of course, he was wrong. If the money went into people's pockets instead of into various tax dodges like the ones he uses, it could be taxed.
Re:Corporations are people (Score:4, Informative)
Oil is a fungible commodity. That is to say, oil of similar quality is worth the same regardless of whom it comes from. That is to say, they cannot raise prices because their competitors (of which there are many, many competitors in the crude oil industry) will eat them alive.
And even ignoring all that, your statement implies that by raising prices they could increase their profit margins. Why wouldn't they be doing that before the fine was levied. That would be like someone at the boardroom meeting says "if we increase our prices by 10% we will see a $4.5 billion increase in profit", if it worked that way they would have done it already.
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If BP controls the franchise than even if they do not set the price they would have near absolute control over it.
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But I don't know if that is true or not, it is simply something I've heard.
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They must sell a lot of petrol indeed.
Most independent forecourts make between two and four pence profit on a litre of fuel – meaning a full tank only earns the petrol station between £1 and £2.
Link [shropshirestar.com] is a bit outdated but I can't see how a garage's lot will have improved much in the past year. For the sake of those who live in other countries, a full tank of fuel here costs around the £50-60 mark (€60-75 or $80-100)
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For some people you have to simplify the simplification of the simplification. When I feel that is necessary, I like to make it obvious that I'm dumbing things down so I don't feel as stupid spelling things out.
Re:Corporations are people (Score:4, Insightful)
Yea but that's not exactly a market in which competition is a thing. They'll just jointly raise prices, the others will make a bit more profit in the short-term for when it's their turn to pay for a major fuckup and the industry as a whole does business as usual.
Re:Corporations are people (Score:5, Insightful)
Oh how I wish this wasn't posted AC...
Thats exactly how an oligarchy works. Today, company A would love to raise prices to make more money, but B and C won't play along, so they can't. We now know for certain that company B will raise prices next week by X dollars. Therefore A and C will match and stash away the profit.
Its not entirely bad, because its not so much a fine for BP as a reward via higher profits to all their competitors. If CEO compensation were related to profit (which it is not) then there would be intense pressure to not screw up and miss out on the fine platter of free profit.
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Bonuses related to profit would just screw up things more. They'd do deals that give extreme profits now, but wreck the companies future. So they get a bonus, company profits plummet in the beginning of next year, they get fired and get their golden parachute. What more could they ask for?
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I wonder if it's an option to pay performance-related bonuses 2 or 3 years down the track. IOW, delay paying this year's bonus (i.e. the reward for big profits this year), for a few years. That way, if the company continues to be profitable, the CEO/exec team has earned their bonus, and good on them. If the company is not profitable at that later stage, the company keeps the bonus and uses it in whatever way it needs, to become profitable again, e.g. research, infrastructure, investment, whatever. Or maybe
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I've played around a bit with proposing having bonuses be based on difference in the net worth of the company between two time periods - profit + assets, NOT stock price. The time period should be not less than a year, and the really big bonuses for things more like 5-10 year performance.
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If the company is not profitable at that later stage, the company keeps the bonus and uses it in whatever way it needs, to become profitable again
The unspoken and sadly true assumption here is that the bonus is big enough to do that.
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I don't have any actual figures, but the combined total bonus of CEO, CFO, CTO, and the rest of the exec team times 3 years must add up to a decent sum.
Let's put it another way - a company puts aside a certain amount of annual profit (equivalent to exec team bonuses) as a "future fund" or reserve fund for future downturns. Any money that's been in the fund longer than three years is eligible to be paid to the exec team as a bonus, subject to ongoing overall profitability. If you voluntarily leave th
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I don't have a problem with bonuses as such, just as long as they are tied to realistic performance criteria, such as my suggestion above. You've got to have payment systems to attract the best & brightest, unfortunately shareholders and boards of directors too frequently equate "best & brightest" with quarterly profit and market-speak, rather than fine judgement and actual ability. The old-boy network is also alive & well.
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I hate to spoil the fun, but oil companies don't "set" the price of oil. It's ultimately determined by futures contracts for delivery of the various crude oil products.
Plus supply, demand, production rate, and other smaller factors.
We now return you to your regularly scheduled conspiracy theory.
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So, companies had their rights elevated to the rights of people.. But what would happen if people had their rights elevated to the rights of companies?
I mean, manslaughter -> pay $4.5 billion, and walk free.
Must be new, or young. search wikipedia for OJ Simpson
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OJ did his bribing in secret (at least at the criminal trial). This would let a person walk into court, plead guilty and pay the fine for murder.
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It costs a lot less than that to walk free from manslaughter.
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So, companies had their rights elevated to the rights of people.. But what would happen if people had their rights elevated to the rights of companies? I mean, manslaughter -> pay $4.5 billion, and walk free.
If you had $4.5 billion you could probably do it.
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That whole idea of pursuing individual employess of a company, including the CEO, is that is in addition to fines and possible break up of the company. So as always prosecutions start down low, further investigation and access to greater evidence pushes the prosecutions higher up within the company. Obviously the goal should be to prosecute the senior executives and the board as they are either incompetent in managing a company which is out of control or they are colluding in the high risk management of th
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No, not the death penalty, you need to murder people for that. Mass manslaughter is probably still just a life sentence. So put them in prison - have the people who were harmed take control of the company for 100 years or so. Then they can divert all of the profit the company makes to fix the damage the company did and at the same time deny any bonuses to the management.
No. (Score:2)
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The simple fact is that big corporations are job creators. They also generate a lot of tax revenue. US corporations operate under the highest corporate tax rate in the world. Corporations should be held accountable for any wrong doing but demonizing the big bad evil corporations 24x7 can put a lot of jobs in danger. The higher ups may have golden parachutes in case the corporation goes belly up but all the other rank and file employees don't. BP has close to 83,000 employees who would lose their job if the
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The simple fact is that big corporations are job creators.
NO!
The real job creators are the consumers (I hate that word but it works here) who have the money to buy what the corporations (and other businesses) have to sell. No business is going to hire anyone unless they have someone to sell to. If there is demand for some product or service then the demand will be filled, be it by a corporation or an individual business, creating jobs. I'm not saying demand can't be created by coming up with some great new thing (i.e. smart phones) but unless a business thinks
Scapegoats (Score:2)
The company has escaped charges, only a few people are actually facing actual charges. I would guess that lots of people behind the company execs who were actually writing the lies will collect their big pay packets and not actually give a shit.
Re:Scapegoats (Score:5, Insightful)
The larger damage was not to manslaughter but to destroying a complete ecosystem - Privatizing profits and socializing losses in action. Companies trifle with natural resources because they know if it all fails, we will have to pull together to get out of it.
On the same note, why can people put a price on a pirated mp3, but not on a long-term damaged ecosystem?
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I calculated the amount of oil once. Based on the size of the Gulf of Mexico, and the high estimate for how much oil was pumped in, IIRC it came out to the equivalent of about a teaspoon or so in an Olympic-sized swimming pool. Not exactly devastating.
Re:Scapegoats (Score:5, Insightful)
This was falsified a long time ago. Natural seepage into the Gulf nowhere equals what was puking out of that damaged well. The ecosystem has not returned to normal, and with the added known of the dispersal chemicals, no one can actually say what is happening or how long it will take for the oil to be absorbed. But this belief that bacteria just magically eat oil and in turn leave behind no deleterious side effects is pretty much akin to claiming that women's reproductive systems magically expunge rapists' sperm.
But you would have made a great member of the group at the beginning of Thank Your Smoking; the oil company representative who insists that oil spills just get eaten up by the ecosystem, and even vaguely hints that ecosystems actually benefit from it.
Actually, what you're post reminds of is a great and sadly departed Seattle comedy show called Almost Live, where there was fantastic sketch featuring a pro-tobacco lobbyist who said bizarre things like "Three out of four chiropactors agree that not only does smoking not harm you, but in fact places a protective coating on the lungs!" You could have done the followup sketch; "Three out of four industry 'researchers' insist that only do oil spills not harm the environment, they in fact feed the bacteria and make the environment even better!"
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And you know this how? No researcher I know is claiming it has been removed.
Sitting mixed with dispersants at the bottom of the Gulf of Mexico is no "removed".
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The larger damage was not to manslaughter but to destroying a complete ecosystem - Privatizing profits and socializing losses in action. Companies trifle with natural resources because they know if it all fails, we will have to pull together to get out of it.
On the same note, why can people put a price on a pirated mp3, but not on a long-term damaged ecosystem?
Copyright or patent the Gulf of Mexico then.
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Privatizing profits and socializing losses in action.
Spending in excess of $20bn of your profit sheet fixing the environment while local councils make interesting claims then squander the money which should have been destined at fixing the problem is exactly the opposite of what you say.
The Exxon Valdez is an example of what you say. But so far the profits and losses have been fully privatised. That's kind of how it works when the government gives you fines on top of your cleanup efforts.
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People make money by exploiting the ecosystem - why not just take their income as the value per year? So add up the income of every fisherman, tourism worker,.... Then multiply it by the time it's going to take the ecosystem to recover - a few hundred years or so? (guessing here). And that should be the actual damages. The punitives can start from there.
Re:Scapegoats (Score:4, Funny)
It's escape goats, dude.
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Are you saying there's a goat on the lam?
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But, people being held responsible nonetheless. The next time an edict comes down the "pipe" to start drilling without proper precautions, the folks on point are more likely to CYA and either get official clearance from above (absolving them of blame) or just outright refuse to follow orders.
Settle criminal charges? (Score:4, Interesting)
You can settle criminal charges with a load of cash? That doesn't seem right to me.
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And by "kinda makes sense" I mean in the insane worlds of the judicial system and business.
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A company's... ahem... "life" would be money. In jail, basically part of your lifespan is given up. It kinda makes sense that criminal charges would result in a fine.
And by "kinda makes sense" I mean in the insane worlds of the judicial system and business.
From a back dated way of looking at the balance sheet, that kinda makes sense. The problem is looking at historical balance sheets for BP I don't think it took them very long to accumulate $1B on the balance sheet, so you're only taking away a small part of the companies life.
Now if you decided a human would go to prison for 10 years, and found a balance sheet from 10 years ago for BP and did the delta... of course this logic doesn't work so well with dying companies, HP or Kodak or places like that would
KILL THE WIND! (Score:2)
Looks like the demons are escaping into the real world now.
How much longer until we're worshiping disencarnate beings in boxes and supplicating for their guidance?
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Then again, sentencing its executives makes a lot of sense too.
There should be a fine and jail time for the execs who were responsible in the case of BP.
The same for banksters, for that matter.
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A company's... ahem... "life" would be money
No, a corporation's "life" is its corporate charter. A death sentence to a corporation is the revocation of the corporate charter. This used to be the way we punished even huge corporations that egregiously misbehaved. It's way past time to bring those days back.
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Not if the government gets any earned profits during incarceration...
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You've never heard of Hollywood accounting have you...
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Easy way around that.
Take it out of revenue not profit. To ensure they do not cook the books calculate it out of the ratio of days in a year. So 180 days in prison would be nearly 50% of gross revenue for the year. To ensure no cross year shenanigans also require it to be no smaller than 40% of the previous years.
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Far easier. Seize all revenue, not profits.
People don't generally collect a paycheck from their normal jobs while in jail. Hey, if corporations want to be people lets treat them like people.
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Not if all the employees, executives, boards of directors and major shareholders were to find themselves sitting in cells without private toilets and sharing the space with a really big guy with arms as big as tree trunks who insists "You an' me are gonna be the bestest of friends."
Believe me, if that were the consequences, corporate governance would be a whole different bag of worms.
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While that is generally possible for lesser charges I don't think it is normally the case for manslaughter charges.
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Sure, but he plead guilty to a lessor charge. So your example is not that at all.
Getting charged with... (Score:3)
A judge also may set bond conditions and other restrictions on the defendants, but the workers don't face arrest ahead of time, their lawyers said.
Not your typical criminal manslaughter treatment.
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Comment removed (Score:4, Insightful)
So if we can hold the oil company accountable... (Score:5, Insightful)
Why can't we hold the financial industry accountable and start putting bankers in Federal pound-me-in-the-ass prisons?
No: of truthful notifications (Score:2)
The whole point of the justice system isn't to punish people for making mistakes. It's to punish them for intentionally making mistakes as a deterant.
In this case, the problem wasn't the spill -- it's certainly not something that they did intentionally, and hence they needn't be discouraged from spilling again. The problem is that they didn't follow through with the obvious safety procedure of screaming "fire!" and "get out of the way!" and "the oil is coming!".
Not screaming -- or not screaming soon enoug
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I would say blaming them for a spill is fine as well. You are still responsible for cleaning up the mistakes you make even if they are not intentional.
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Oh certainly, but that's not a criminal offense. That just a professional obligation.
Drop, meet Bucket (Score:4, Interesting)
With over $150 Billion in equity* it's a laughable settlement considering the gross negligence BP should be cited for.
[*] - http://www.bp.com/extendedsectiongenericarticle.do?categoryId=9021229&contentId=7039276 [bp.com]
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40,000 people out of a job and the 2nd largest source of oil and gas for the US being shut down (even if the assets were seized, it would take a long time for production to start up again).
That's Why You Drill in China (Score:3)
Where's the apology? (Score:4, Funny)
You can now pay fines for manslaughter? (Score:3)
Does this mean rich people can just kill the poor and pay fines now?
Taking a life illegally should at least warrant some jail time.
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Does this mean rich people can just kill the poor and pay fines now?
Taking a life illegally should at least warrant some jail time.
I agree, in tthe case of a corporation the equivalent would be to hand over all operations (below the executive suites) to a consortuim of competotors to run for the length of the sentence, under court supervision of course. Just like what would happen to you and me in the same situation!
Any profits for that period would go to "reasonably compensate" the consortium.
The evidence is that this arose out of corporate decision making so a corporate wide penalty would appear to be approprite.
also, EPA bans BP from federal contracts (Score:2)
also today:
the EPA has banned BP from federal contracts [csmonitor.com].
BP denied EPA contracts (Score:5, Informative)
The more important and related story is that due to this, the EPA has suspended BP from any further contracts with the Federal government.
http://blog.chron.com/lorensteffy/2012/11/in-suspending-bp-epa-does-what-drilling-regulators-would-not/ [chron.com]
I'm sure it will not be long before BP is crying about unions and regulation and it being too expensive to do business in America.
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So rather than invest in companies that don't have a worse safety rating than all their competitors - combined - you'd rather just invest in jurisdictions where they don't give a rats ass how many workers they kill or how many billions of dollars in dam
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You can settle criminal charges now? (Score:4, Insightful)
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That's nice. So go right ahead and take up that manslaughter hobby you've always dreamed of! After all it was only what, 11 people killed? so $4.5 billion divided by 11: that means you can murder anybody you want for the low low price of only ~$409 million!. What are you waiting for!? ...I fucking hate this country.
To be fair, they qualified for the bulk discount.
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So go right ahead and take up that manslaughter hobby ... that means you can murder anybody you want ... I fucking hate this country.
Don't worry mate I hate your country too. Mainly because your education system gives you the idea that manslaughter and murder are the same thing.
No child left behind my arse.
No souls to damn (Score:2)
But it's extremely hard to get minions to testify against their capo. A murder charge is a wonderful incentive.
Your rage will never be slaked (Score:2)
So just admit that. Kill all the executives? Fine them a petatrillion dollars? Outlaw all oil? Pay everyone who lives on the Gulf a billion dollars a head? Arrest charge and imprison everyone on the planet who can spell "BP"?
Feel free.
Woohoo! (Score:2)
On another note, until we start fining these companies out of existence and holding CEOs as accountable as engineers this will go on. When profits from crime > fines folks it doesn't take a genius to figure out what you're gonna do. Once again though I'll remind everyone that we can't do that because at the end of the day, the people really responsible for this are our rule
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So log in, and tweak your homepage settings to not include 'your rights online'
Problem solved.
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But, how on earth does a company that is ever found guilty of a manslaughter charge ever serve prison time???
Lots of options: A) Close the doors, permanently or temporarily B) Fines equal to multiple years worth of profit, equivalent to the wages lost when a person is in prison C) Massive government oversight into their operations from the boardroom down to the people manning the rigs, paid for by BP through fines D) Government seizure of assets up to and including the entire company, to be sold off to the highest bidder.
"Oh noes! That screws the shareholders!" Yeah, that's the point. We've already decided, a
cognitive dissonance plus ultra (Score:2)
shareholders
So fractional slavery is acceptable?!!! I thought we settled this 150+ years ago.
This whole "companies are people, too" road leads to madness.
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It doesn't enslave the shareholders, it punishes them for their roll in a crime. They are financially supporting a company that performs illegal actions. They have the right to vote new directors, new policies, new mission statements, and in extreme cases they have the right to sue if their interests aren't be met. If all else fails, they have the right to sell their stock to someone else.
Imagine it this way: I've got a buddy who used to work in the oil business. He's got land that he knows has oil unde
Re:Stupid summary (Score:5, Interesting)
A few states, such as Australia and the UK have such a thing as corporate manslaughter. Not every murderer acts on his own initiative, sometimes he has his employer's interests at heart. UK version [hse.gov.uk]
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1. BP does not stand for British Petroleum and hasn't since the late 90s when American Oil Company and British Petroleum merged to format BP AMOCO. The merged company later changed the name to BP, not short for anything.
2. More BP stock is owned by US companies and individuals than British.
BP is multinational, the HQ of the parent company might be in London but it's owned by Americans.
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This presumes that board members, major investors, and the CEO were both aware of, and actively refusing to do something about safety and environmental concerns.
In a company the size of BP, it's flatly unreasonable to expect that the board & CEO will be aware of every minor decision and safety concern anywhere in the company the moment it is raised. Now, if there is evidence that those people were negligent in responding to, addressing, or correcting issues that they were clearly informed of, then you'
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Because they had no idea this was going on and no way to act against it.
The customer is always the least information actor, thus the least responsible.
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The Board of Directors too.
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