Wednesday, June 13, 2007

Corporate victimization . . . ?

Corporate victimization . . .

A recent story reminded me of an issue that came up several years ago – the question of whether corporate and other artificial entities can be the victims of certain crimes.

Corporations and other legally-created entities (such as partnerships) can, of course, be the victims of crimes. We often read, for example, about a company’s being the victim of theft or extortion, and I imagine we don’t give much, if any, thought to the fact that it’s a thing, a fictive construct, that is being victimized instead of a real, flesh-and-blood person.

I think this kind of corporate/artificial entity victimization has never been a conceptual problem either for the law or for the public because these are theft crimes. Theft, fraud, extortion, embezzlement and other financial crimes can all involve taking tangible (e.g., gold, silver, other physical assets) or intangible (e.g., data, proprietary information) from a corporate or other entity, and when that happens the entity suffers precisely the same “harm” a real human being would. The legally-created entity, like the victimized human being, loses all or a portion of their property.

But what about identity theft?

In 2004, Phoebe Nicholson, a paralegal who worked for Honeywell International, was generically accused of corporate identity theft. The law firm of Fish & Neave had done work for Honeywell in the past, so Nicholson allegedly “forged her boss’ signature on seven phony bills from the firm, then persuaded Honeywell to send the checks to her for delivery instead of mailing them to Fish & Neave.” She had sent up a bank account in a name that was “nearly identical” to the firm’s name and was able to divert almost $600,000 to that account before being caught. At the time, the local district attorney said that Nicholson “`basically stole the identity of this law firm’”, which made me think.

A law firm is usually either a partnership or a professional corporation. Can you steal the identity of an artificial entity? I believe most, if not all, identity theft statutes assume the victim is an individual.

The basic federal identity theft provision, for example, makes it a crime knowingly to possess and/or use an “identification document” that does not belong to you. 18 U.S. Code section 1028(a). It defines “identification document” as
a document made or issued by or under the authority of the United States Government, a State, political subdivision of a State, a sponsoring entity of an event designated as a special event of national significance, a foreign government, political subdivision of a foreign government, an international governmental or an international quasi-governmental organization which, when completed with information concerning a particular individual, is of a type intended or commonly accepted for the purpose of identification of individuals.. . .

18 U.S. Code 1028(d)(3). Under this statute, therefore, I don’t see how assuming the identify of a corporation or a partnership could ever be prosecuted as identity theft, and I think the same holds for state identity theft statutes, as well.

We could, of course, broaden existing identity theft statutes so they encompass the misappropriation of the identity of a corporate or other artificial entity . . . if we thought it was necessary to do so. I’m not at all sure it is. In the Fish & Neave case, Phoebe Nicholson was charged for what she really did: steal money that did not belong to her. More precisely, she was charged with grand larceny under New York law. She pled guilty to these charges and to separate charges stemming from using a similar scam to steal money from a mortgage company, and was sentenced to serve 3-9 years in state prison. Laura Williams, Guilty Plea in $1M ID Theft, New York Daily News (February 28, 2005).

So I’m not sure we need a corporate identity theft crime, at least not one that merely targets conduct that can be prosecuted as theft or embezzlement. And if we decide those laws are inadequate, it seems to me we can simply address the problem by simply expanding the scope of our existing theft and, if necessary, identity theft laws.

This brings me to the very recent case I read about and a very different kind of corporate victimization.

I saw a news story today, which is dated Tuesday, that comes from Cincinnati. It seems there’s a fellow there who is neither a student at the University of Cincinnati nor is employed there, but who keeps coming back to campus. The story says police have arrested him 22 times in the last 5 years for trespassing there (which is not something I’ve ever heard of, but maybe it doesn’t come up much). Last month the university got a temporary restraining order barring him from campus, and on Monday a local court held a hearing, at which lawyers for the university said he should never be allowed back on campus.

Specifically, a lawyer from the Ohio Attorney General’s office who was representing the university said this gentleman has been “`stalking an institution’”, which really gave me pause. I’m not sure how you “stalk” a corporate entity (universities being artificial legal entities, specifically, non-profit corporate entities).

According to the lawyers for the university, the man has “become too great a drain on the resources of police, who've spent `hundreds of hours’ locating him, cuffing him, writing reports, testifying in court.” He apparently attends classes on occasion, uses the library, and has been found in various positions and in various states of sobriety all over campus.

I’m sure the lawyer from the Ohio AG’s office was only speaking figuratively when he said this man is stalking the university, but I still found it an intriguing notion. I suppose it is possible (isn’t anything possible?) that someone could stalk a corporate entity, but I find the notion of that kind of corporation victimization problematic.

The “harm” stalking and harassment laws are intended to address is someone’s using a repeated course of non-threatening conduct (if the conduct is threatening, then it can be prosecuted on that basis, instead) to inflict emotional and/or psychic distress on an individual. We have the first component in this case; the gentleman at issue here has, according to the story I saw, engaged in a lengthy, repetitive course of non-threatening (but aggravating) conduct directed at the university.

The problem, IMHO, with ever construing this kind of incident (assuming this one is not unique, which is probably is not) as corporate stalking comes with the second element of a stalking or harassment offense – the requirement that the conduct inflict emotional or psychic injury on a victim. Being soulless, artificial entities, I do not see how a corporate entity can suffer psychic or emotional injury. It seems to me the injury they sustain, if any, is the injury encompassed by the harm of trespass: someone goes where they are not legally authorized to go, thereby violating a property owner’s rights to exclude persons from the occupation and use of their property. So I can’t imagine why we would ever really need a corporate stalking offense.

As I said, though, I’m sure the Ohio AG lawyer was only speaking figuratively.

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