Ron Levy (6/01):
It will be fascinating to see whether BP Worldwide takes the position that BP Americas is a separate company so that Americas may be liable for "valid" claims but Worldwide is not. It's common for corporations to be in effect holding companies for subsidiary corporations.
WPP may be a holding company that employs no writers, no art directors, but lots of accountants who are sent in to "help" an agency chief figure out "what went wrong" if a profit percentage objective is not met. If a WPP-owned PR firm were found liable for a billion or even ten billion in damages caused by a horrible error, it might not--and many would say should not--cost WPP nor Sir Martin a pound of flesh, a pound nor a farthing.
Hilton International at one time had fewer than 100 employees overseeing companies that cumulatively managed billions in assets. An honorable corporate objective, like the objective of millions of companies that have incorporated, is to limit liability. It's not a filthy desire and most of us have car insurance and homeowner insurance that also shields us from liability.
One can imagine a Worldwide leader saying: "We've been appalled by the tragic loss of life and environmental damage but we didn't hire BP America's engineers. We didn't train them, employ them, supervise them, choose their equipment nor participate in their decisions about where to drill, how to drill, when to drill nor what to do in case Transocean's blowout protector failed to adequately protect against a blowout."
Throughout the U.S. and the world there are "families" of companies, and a corporate pater familia is not a guarantor of whatever debts or liabilities the corporate kids may incur. American courts have repeatedly refused to "pierce the corporate veil." words that lawyers use. I'm not saying courts should or shouldn't do this but it's how it is.
One could reason that if you own stock in a company, that shouldn't make you responsible for the company's debts. In the same way, if BP Worldwide owns stock in BP Americas--even if it's ALL the stock--should that make Worldwide more liable for BP America's debts than you and I are for the debts of companies in which we're stockholders? It goes further than that because BP Americas may be the parent of subsidiary companies so that one company drills in the Gulf, a different corporation does transportation, a third is a sales compasny, and none of the non-Gulf corporations are responsible for the debts of the corporation with troubles.
I don't have the facts on this. Congress and most media may also not have the facts. But I remember reading my children the story of "not I" crowed the rooster, "not I" grumped the pig, "not I" whinnied the horse, and they lived happily ever after. |