The Straight Dope on corps, stocks and virtual persons.

Post #116,638 by Another Scott 9/4/03 5:58:52 PM Reply	The Straight Dope on corps, stocks and virtual persons. [link\|http://www.straightdope.com/mailbag/mstockmarket.html\|Here] is a good article on the basics of corporations and stocks. The legal status of a corporation derives from three arcane but vital principles: (1) limited liability, (2) transferability of shares, and (3) virtual personhood. [...] But what is a virtual person? No, we're not talking about Commander Data here. Virtual personhood simply means that a corporation, as far as the law is concerned, is treated as though it were a human being. It has a name, can own property, enter into contracts, file lawsuits and be sued, be taxed by the government, open bank accounts and establish credit, and so on. In all these situations, the corporation acts as its own person, entirely distinct from the persons who own it (who, by the way, might be other virtual persons themselves). Corporations even have many of the same rights as persons, such as the right to free speech. Case law in the United States, however, recognizes that the speech of actual persons is generally more important than virtual ones. Curiously, the U.S. Supreme Court established the personhood of corporations through a famous (or infamous) 1886 decision based on the 14th amendment--you know, the one intended to protect the rights of former slaves. The court held that "equal protection of the laws" applies to artificial persons as well as natural ones. [...] Cheers, Scott.
Post #116,642 by mmoffitt 9/4/03 6:02:27 PM 9/5/03 12:35:36 PM Reply	Why not? When more than a few consider "spending money" speech, is this a surprise? bcnu, Mikem The soul and substance of what customarily ranks as patriotism is moral cowardice and always has been...We have thrown away the most valuable asset we had-- the individual's right to oppose both flag and country when he (just he, by himself) believed them to be in the wrong. We have thrown it away; and with it all that was really respectable about that grotesque and laughable word, Patriotism. - Mark Twain, "Monarchical and Republican Patriotism" Edited by mmoffitt Sept. 5, 2003, 12:35:36 PM EDT Expand All History
Post #116,662 by deSitter 9/4/03 7:52:02 PM Reply	Ridiculous Can it eat? Make love? Get scared? Get sick? Have trouble pissing? Experience joy? Play with a kid? Lose its freedom? Wonder? -drl
Post #116,696 by gdaustin 9/4/03 11:28:45 PM Reply	From the standpoint of the law.... Ross... But, I think that, more and more, government is asking for the officers of a company to carry "personal responsibility" for illegal acts performed by persons at the company. So carrying your example out further: If a company "steals", government now wants to send real people to jail (the officers of the company), rather than just having "the company" be punished thru fines. There are limits to how much a company can be a "virtual person". You can't put a company in jail. But you can act upon them financially, by levying fines. Some would argue that you can give them the "death penalty" by forcing them into bankruptcy. That's why people like former Enron and MCI/WorldComm officers are being carried away in handcuffs. The protection of a "virtual person" can only go so far. Personally, I would like to see majority shareholders punished also, when a company (or officers) so wrong. I think more shareholders would take ethical violations much more seriously. Imagine if Warren Buffet had to spend a night in jail because an officer of a company he owned 50% of decided to be a criminal, under the name of the company. He would become a whole lot more interested in how the company was managed. It's time we make owners of companies responsible for what their employees do, both officers and shareholders. You can't hide behind the "virtual person", just like Oz couldn't hide, either. Glen

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