On Corporate Privilege – Have They No Shame?

April 21, 2015

In a legal system which holds corporations responsible for virtually nothing, corporate power, hypocrisy and the wall of corporate shame keep growing.

Corporations put clauses in consumer contracts that make suing them useless and impossible. They make us sign those contracts for most of what we buy from the modern economy. The Supreme Court says OK on the fiction that we don’t have to sign the so-called agreements. As far as the Court is concerned, all we have to do is opt out of the economy and then no corporation can bother us.[1] If a dispute ever gets to a hearing, it is heard by arbitrators chosen by the corporate sellers.

Industry groups repeatedly argue that they have to put such abusive provisions in their contracts or they couldn’t give us a good deal. In other words, when people are down, their mortgages underwater, corporations should just keep kicking – they’re really just doing it for us.

That’s bad enough for people who are just trying to be treated fairly. But corporations have been getting the privilege of trashing rules protecting us from toxins and pollutants in favorably disposed forums. These are so-called investor-to-state dispute settlement or ISDS clauses in international trade agreements. Corporations can attack any rules that will cost them money, which of course means all regulation is vulnerable. Like the domestic arbitration clauses that the U.S. Supreme Court has blessed, “These challenges are not heard in a normal court but instead before a tribunal of private lawyers,” as the Alliance for Justice and many prominent attorneys have told Congress.[2]

There’s already an ISDS clause in the North American Free Trade Agreement, or NAFTA.[3] Corporations are trying to keep the ISDS mechanism in trans-atlantic agreements that multi-nationals will use against food and environmental laws here and in Europe, claiming they restrict free commerce.[4] Cecilia Malmstrom, the European Union’s trade commissioner, responded “We want the rule of law, not the rule of lawyers.”[5]

Describing the terms of the 12-nation trade accord for a Trans-Pacific Partnership for which Congress is considering fast track authority for President Obama, Jonathan Weisman wrote in the Times that it would “allow foreign corporations to sue the United States government for actions that undermine their investment ‘expectations’ and hurt their business,” using the business friendly ISDS procedure.[6] Once again that is poised to protect multinational corporations from food, health and environmental regulation.

In D.C., the coal industry is trying to convince the U.S. Supreme Court to block the Environmental Protection Agency from going ahead with procedures for strengthening rules preventing toxic emissions of mercury.[7]

Here at home, toy industry groups are suing against efforts of Albany County to ban the sale of toxic toys, with such poisons as lead, mercury and arsenic, claiming it’s a violation of the Constitution and federal statutes.[8]

Business repeatedly claims regulation isn’t necessary because they are honorable and we can trust them and the economy. But their choice of legal targets make clear what they really believe.

No one has the right or privilege to put toxins in us, in our air, water, or our kids’ toys. Have they no shame? It’s time we had a government, all of whose branches respected the rights of the rest of us.

— This commentary was broadcast on WAMC Northeast Report, April 21, 2015.

[1] See American Express Company v. Italian Colors Restaurant, 133 S. Ct. 2304, 2313 (2013) (Kagan, dissenting); Buckeye Check Cashing, Inc. v. Cardegna, 546 U.S. 440 (2006).

[2] Letter over the signature of many well-known law professors and sent by the Alliance for Justice to congressional leadership, available at http://org2.salsalabs.com/o/6539/p/dia/action3/common/public/?action_KEY=19342.

[3] NAFTA ch. 11.

[4] REUTERS, EU Seeks Solution to Keep Arbitration in U.S. Trade Deal, March 18, 2015, 12:22 P.M., http://www.nytimes.com/reuters/2015/03/18/business/18reuters-eu-usa-trade.html.

[5] Id.

[6] Jonathan Weisman, Trade Pact Seen as Door for Suits Against U.S. New York Times, March 26, 2015, at B1, available at http://www.nytimes.com/2015/03/26/business/trans-pacific-partnership-seen-as-door-for-foreign-suits-against-us.html.

[7] Editorial, Dirty Coal at the Supreme Court, New York Times, March 23, 2015, at A20, available at http://www.nytimes.com/2015/03/23/opinion/clean-air-act-and-dirty-coal-at-the-supreme-court.html?emc=edit_tnt_20150323&nlid=47098180&tntemail0=y.

[8] Matthew Hamilton, Industry contests toxic toys ban, Albany Times Union, April 17, 2015 at A1.


Ukraine – The Limits of Power

April 22, 2014

It’s worth another look at Ukraine. Americans have taken a principled pro-democracy stand. But before we get too self-congratulatory, let’s find a little perspective. Read the rest of this entry »


Our Stake in Europe

December 6, 2011

Do we have a stake in what is happening in Europe? Some countries, particularly in southern Europe are having trouble paying their debts in a recession. It shouldn’t be a surprise – taxes shrink in a recession. Of course in some places it is pathological – Greeks refuse to pay the taxes they owe in such large numbers that they are bankrupting their country. But the problem is wider, with deep roots in the recession.

As a result other countries have been reconsidering their participation in the Euro and even in the European Union itself. Should we care? Read the rest of this entry »


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