Satellites are usually insured. (Not sure about NASA protocol, though.) If that’s the case, the insurer will sue. Shareholder lawsuits will also, naturally, follow, as will suits from all the other customers.

Agree, though, that it’s shocking nobody is going to jail in relation to a fraud guilty plea.

They are though. From the justice.gov article:

"Dennis Balius, the SPI testing lab supervisor, led a scheme to alter tests within SPI’s computerized systems and provide false certifications with the altered results to customers. Balius also instructed employees to violate other testing standards, such as increasing the speed of the testing machines or cutting samples in a manner that did not meet the required specifications. Balius pleaded guilty in July 2017 and was sentenced to three years in prison and ordered to pay over $170,000 in restitution."

You can't send SPI to jail though, because it isn't a human.

This is especially interesting in the context of corporate personhood[1]. You can't send a corporation to jail, but you can disband it entirely, or prevent it from operating. A lot of the practical solutions try to leave badly behaving company operating, though, since if we shut them down there is a lot of collateral damage in the form of lost productivity in the economy and lost jobs. IANAL, but my opinion is that there needs to be a better non-nuclear option for an actual guilty conviction for corporations. As I understand it, if a company actually goes to trial and is convicted, they are not allowed to operate anymore, hence the plea deals and fines.

Please correct me if I am wrong, though.

[1]https://en.wikipedia.org/wiki/Corporate_personhood

You know, I am a lawyer (a corporate one who freelances as a white collar crime journalist at that!) and I don't even know how this would work. I can't even think of a single criminal case against a corporation that I've reported on that went to trial. It just doesn't really come up. I suspect because it's much easier to charge the directors of the corporation with racketeering or fraud.

That being said, I can't imagine a criminal conviction of a corporation would dissolve the entity. We don't execute people for committing fraud so I'd be surprised if a judge would execute an entity. I'm also not sure what would stop a corporation from quickly winding up if it seemed criminal charges were on the horizon. After all, you can't charge a "person" with a crime if that "person" isn't there to defend themselves.

Individuals charged with crimes are defended by attorneys without visibly participating in their criminal trials all the time.

I can't imagine a criminal conviction of a corporation would dissolve the entity.

No need to dissolve it, simply place it under the same kind of restrictions that someone in prison is placed under - no direct financial activity, severely curtailed communications, etc.

Lack of visible participation is far from lack of participation. In the US due process requires the defendant's presence to commence a criminal trial. Once charges have been brought the defendant has a right (that can in some circumstances be waived) to attend and participate in every stage of the trail. Barring a few narrow circumstances[1] once proceedings have commenced a criminal trial in absentia is unconstitutional.

[1]https://en.wikipedia.org/wiki/Trial_in_absentia#United_State...

Edited - reworded "persons" to "legal persons" in a few places.

Post your question on r/legaladviceofftopic I bet you'll get some very interesting answers...

There are things that you do and a corporation do that a river can't do, and to describe this set of things laws use the term "person" this makes sense but the name is terrible. In the US, for instance, you can't sue a mountain if you fall and hurt yourself - you can sue a mining company that left equipment there, or maybe the national parks service for having unsafe trails or maybe even your friend Fred (i.e. Purdue Pharma) for pushing you off the edge of the cliff (maybe, more accurately, for failing to inform you of a dizziness side effect in a medication they sold you that caused you to fall) but you can't sue the mountain itself and, likewise, there is no way a mountain could be punished that we can comprehend - again, maybe if this mountain is owned by someone then, as a result of this suit, you are awarded partial mining rights or ownership of the mountain - but that is a compensation granted at the loss of some other entity, maybe a mining company, or the property owner or even the US government.

Either way, corporations and human beings have some legal commonalities that aren't shared with mountains.

elliekelly as you're actually a lawyer, can you express this better or clarify it?

To your point, corporations have always had "rights." The government can't just show up to your house and take your property without due process and, because corporations are "legal persons," the government can't just show up to company headquarters and take corporate property either. Corporations need some of the legal rights we grant to natural persons or else the corporate entity is pointless. But corporations also can't have the same rights as natural persons or else every stock broker is also a slave trader.

The reason the Citizens United ruling was such a big deal was because the court extended first amendment rights to corporations when those rights had historically only been given to natural persons. If you get a chance you should read the opinion because the rationale seems much more reasonable on paper than it is in practice. Contrary to public opinion, the court didn't rule that "corporations are people" (technically they always were) but rather that corporations are associations of natural persons and since natural persons can form associations to exercise their first amendment rights then they can form corporations to exercise their first amendment rights.

But for an entity whose purpose is to exist somewhere between human (definitely a person) and mountain (definitely not a person) it doesn't make sense to extend all of the rights of personhood to that entity just as it doesn't make sense to treat the entity the same way we treat a mountain. Lawyers can form associations to practice law but we certainly wouldn't allow a group to incorporate and have the entity sit for the bar exam... right? Citizens United certainly muddied the water in where the law draws that line.

Understood, but unless my perception is wrong there are many cases where individuals are defended without significant participation - whether it be because they're (arguably) incompetent to participate, decline to participate or for other reasons.

Criminal charges do not require the assent of the charged to proceed through the system.

Just generally, I'm not buying this

> After all, you can't charge a "person" with a crime if that "person" isn't there to defend themselves.

especially since people can be charged with crimes for failing to show up for court dates and, while I'm not certain about the US legal system, plenty of war crime charges have been formally with the charged party in absentia.

So while I'm not at all a criminal attorney (and I don't pretend to be an expert here) a defendant's presence at a criminal trial is first year law school stuff. A defendant absolutely must be present for the initial appearance. They can waive their right to appear (by not showing up once they've been charged) but criminal charges cannot be brought in absentia.

My point was that a corporation that ceased to exist likely wouldn't face charges the same way a deceased person wouldn't face charges because the government can't charge a defendant without their presence.

If the government could charge people with crimes without having them appear in court they surely would have tried and convicted Whitey Bulger long before he was caught and wouldn't have been so concerned with Julian Assange's extradition.

If people could be criminally charged "in absentia", then Edward Snowden, Julian Assange, etc would be convicted of things while they were in hiding.

I think a better analogy is that they don't convict dead people of crimes. There's nothing to be gained from that.

Just "disbanding" a corporation would be pointless. The shareholders (most likely, someone in senior management) could just purchase back (or replicate) the assets and keep going.

The proper ways to "kill" companies include revoking their licenses (see Arthur Anderson), fining them into bankruptcy and possibly liquidation and sanctioning them (for foreign SOEs). None seems to apply in this case, where a prohibition on federal contracting and securing an admission of guilt, which lets other customers who were harmed seek redress through the courts, seem to cover all bases.

This isn't true (a counterexample: https://www.justice.gov/usao-ndca/pr/pge-found-guilty-obstru... ). The reason for plea deals is that neither prosecutors nor defendants typically want to go to court and have a jury trial with an essentially random high-stakes outcome. Both sides usually want to reach an acceptable compromise.

Disbandment also means very little from a punitive perspective, unless you consider disbandment to include seizure of the company's assets. Disbandment is unfavourable because it destroys the value embodied by the company's association: it's customer relationships / brand value, its employee relationships, etc. The cases where disbandment or breakup makes sense are where that association is bad for the rest of society, such as monopolies (e.g. AT&T's antitrust settlement https://en.wikipedia.org/wiki/United_States_v._AT%26T)

A measure of how unjust our culture is is whether crimes that violate these DPAs go unpunished or not... compared to first time drug offenders that get decades behind bars for possession.

I'm not sure why equity holders of malfeasant corporations having criminal culpability should fare better than equity holders of corporations that suffer misfortune. The distinction creates a moral hazard.

I know it's a long-standing doctrine in law and there is probably a good reason for it, but it just seems too easy to abuse.

The issue is really whether corporation itself, as a legal "person" can be convicted, and if so, what does that actually mean, legally?

It wouldn't be up for debate if responsible entities at corporations were actually held responsible for their actions. Corporate personhood is a smokescreen in this case.

The justice system is broken enough in the USA (unless you are rich) that I can’t imagine introducing more issues.

This isn't an excuse for private citizens, so why should it be an excuse as an employee?

That said, we should propagate responsibility as high as possible. If you are a rank-and-file employee and your manager is asking you to do something illegal, unless you have enough professional autonomy to decline the request without being fired then your manager is responsible, not you.

There's a lot of collateral damage with sending the family's breadearner, or a mother, or a father to jail, but we do it anyways.

Fines don't work as well as would be desired, as sometimes it can still be profitable, except for crazy large fines which are basically equivalent to forcibly disbanding the company.

In any case, all three of these tend to hurt the wrong people. They tend to either hurt the shareholders who did nothing wrong (and despite economic theory, have only limited ability to know what really happens inside the company or influence it), or hurts the regular old employees, many of whom will get laid off if massive fines occur, or if the business is forced to closed, and sells off its business units to competitors.

The people with the ability to prevent corporate crimes are most often upper management or the executives. Given how these people are generally compensated, and the demands of the shareholders for maximum profits, most of the incentives don't tilt in favor of them making waves to prevent any corporate crimes they notice are in progress.

In my opinion the correct solution is to recognize that being an executive or upper management in a corporation is a position of public trust, and thus a privilege not a right. Thus when a company commits a significant crime, the upper manager/executives responsible for it should be forced out by the government.

Specifically the courts should have the power to force out a specific executive, upper manager, or board member (as applicable) if: 1. the person was in a position where they knew about the crime (and thus implicit) or ought to have known about the crime (and thus are too incompetent to hold a position of public trust or are practicing willful ignorance) and 2. either had the authority to prevent the crime, or failed to bring the matter to their boss (or the executive with the authority to take actions to prevent the crime, etc).

Furthermore, when this happens the court should have the authority to alter the executives employment contract to nullify any "golden parachute" compensation packages or structures that would make getting forcibly kicked out profitable for the individual in question.

Basically this means that it is in executives and upper management's personal interest to prevent the company from committing corporate crime, since getting forced out would otherwise be possible.

Obviously this should only apply to significant crimes, or repetitive small crimes that the company does not address. It would be absurd to try to apply this to a minor OSHA violation. But on the other hand if the company is constantly being hit with these, and is not making commercially reasonable attempts to fix the underlying systemic problems, then this should be applicable.

And obviously this should become a regular part of corporate criminal settlements, as long as that the named individual be provided an opportunity to demonstrate that they were doing everything they were authorized to attempt to prevent the crime, or to demonstrate the existence of a conspiracy to prevent them from knowing about the crime in question which they would otherwise be expected to have known about, etc.

Note: In practice for condition 1, the government would normally be expected to show that the person ought to have known, given their position and job responsibilities, but the actual knowledge condition is there in case the government finds correspondence where the individual describes the crime, and dismisses it, such as where they decide the fines are just "the cost of doing business".

I'd like to see the federal debarment applied to all individuals within the company's executive team. There's nothing preventing them from perpetrating the same fraud tomorrow by forming a new corp or LLC. Having them named on a debarment will stop them from committing fraud against the American taxpayer in the future.

So I agree that a collection of liquid assets is more reasonable, but it the volume is an issue.

> They are though. From the justice.gov article:

> "Dennis Balius, the SPI testing lab supervisor, led a scheme to alter tests within SPI’s computerized systems and provide false certifications with the altered results to customers...Balius pleaded guilty in July 2017 and was sentenced to three years in prison and ordered to pay over $170,000 in restitution."

Was he the instigator of this scheme, or were his superiors aware?

I'm not seeing the incentive for someone in testing to fake results on their own. I would imagine the motivation would either come from sales (to close a deal to sell product they couldn't actually produce) or manufacturing (to cover up costly quality problems). Balius seems like a fall guy.

There's a lot of missing details, so it's hard to know. From the description of what he did, it seems the interest was not so much in generating false results, but cutting corners, such as running the tests quicker than was allowable. This could have been to make up for some shortfall in lab throughput, for instance.

Also, it sounds like he was in charge of the lab, so fairly high up. That position may have come with substantial performance related incentives.

Instead, we seem pretty comfortable with passing off the responsibility to rank and file employees / middle managers while the majority of the benefits from the bad behavior accrue to the executives and shareholders.

Edit: I get that the criminal intent needed under our current laws means that those charges may not be feasible. That just means we need new laws that hold Executives and Managers criminally responsible for the criminal actions of their subordinates that are committed as part of their work duties.

All government missions (including NASA) are “self insured”. If they fail, they fail, with no way to recoup the cost.

The DPA doesn't prevent criminal proceedings against individual executives, in fact the entire point of it is to focus the punishment on those that made and oversaw the criminal decision making, rather than the company as a whole, which would unduly punish innocent employees and shareholders.

In the case of SNC-Lavalin's conduct in Libya, alongside the criminal case against the company itself, at least one VP was also criminally charged. Subsequently those charges were dropped due to delays (nothing to do with a DPA, which by the way still hasn't happened): https://www.cbc.ca/radio/day6/episode-430-snc-lavalin-in-cou...

I'm not going to advocate for SNC-Lavalin, they're slimy and have been for decades, but the reason the PM pressured for a DPA was so that they didn't incur the automatic penalty of not being able to bid on government contracts, which if applied was thought to be enough to bankrupt the company or at least cause them to move out of Canada.

https://www.amazon.com/Chickenshit-Club-Department-Prosecute...

My personal TL;DR from a couple of years ago if you don't have the time to read the book:

- It's very hard for prosecutors to secure a criminal conviction even in the most blatant cases of wrongdoing.

- Prosecutors care too much about their win rate to risk trials.

- Prosecutors have fallen into a trap where they're so dependent on the policy of offering generous non-prosecution or deferred-prosecution agreements if the company comes forward and volunteers evidence, they've become incapable of actually executing on a complex criminal investigation anymore.

- There's intense political pressure to not punish shareholders for management's misdeeds.

The next steps, they might have done it already, for the government is to go after the people that did the fraud and punish them. Depending on how certain the government feels about how strong the case is they will get jail time, fines and be ban from ever dealing with the government- one or all three.

I know what you mean sometimes punishment feels light versus the crime. But I know that it's a system the works better than one based the other way so we take the good with the bad.