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April 22, 2003

Can Corporations Lie & Conceal Overseas Evils?

The Supreme Court will soon be making two major decisions on whether corporations have the right to lie and conceal information about abusive practices they commit in other countries. In both cases, the Supreme Court is being asked to strike down a California state law-- an interesting test of the federalism principles of the Court's rightwing.

In one case, Nike is arguing that it has a free speech right to lie about abusive practices in its overseas factories, despite a state law allowing citizens to sue for deceptive information spread about commercial products.

In the other, an insurance company is claiming the right not to reveal whether it ripped off Holocaust victimsback in Europe during World War II.

In the Nike case, the protection claimed is the first amendment, a rather radical expansion of "commercial speech" protection that would license consumer fraud to consumers who object to buying products using slave labor overseas. In the Holocaust case, the argument is that the California law might upset international negotiations on compensation to Holocaust victims-- although why keeping insurance consumers uninformed should be ever be raised to a constitutional principle is beyond me.

But ignore the constitutional details for a second-- the heart of these cases is the ongoing rightwing campaign to make corporations, products of the government through limited liability laws, into unregulated monsters that can defy state and even national law through concealing or lying about their internal affairs. As we saw with the dotcom and telecom meltdown-- which was facilitated by the 1996 Securities law that weakened disclosure rules for corporations -- the ability to lie by corporations is the ability to economically rip off the public on an unimaginable financial scale.

If states are denied the ability to prevent such lies or require disclosure of information consumers are concerned about, the result will be further ripoffs of the public, further enrichment of the very wealthy, and greater social inequality both in the US and globally.

Don't buy the legal hype on these cases-- these decisions are about money and corporate power, nothing more, nothing less.

Posted by Nathan at April 22, 2003 03:49 PM

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"If states are denied the ability to prevent such lies or require disclosure of information consumers are concerned about, the result will be further ripoffs of the public, further enrichment of the very wealthy, and greater social inequality both in the US and globally."
Forget precedent. That's all I need to know the Supreme Court vote.

Posted by: John Isbell at April 23, 2003 03:49 PM

A question Nathan,
If I open a business making and selling T shirts that say 'Fuck the War" and I place an advertisement in the National Review, what form of speech am I using?

Posted by: Seth Edenbaum at April 24, 2003 01:37 PM

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