Developments in Environmental Criminal Law: It's Not Just Directors And Officers Who Are Facing Jail

Article by Michael S. Pasano and Thierry Olivier Desmet

Could the supervisor of a rock quarrying project be sent to jail for six months following a sub-contractor's break in a pipeline that resulted in an oil spill on the supervisor's day off? Could a simple foreman be convicted of a crime because his company's sub-contractor committed an environmental violation on the day the foreman was left "in charge"?

Prosecutors have historically pursued criminal charges against corporate officers and directors for violations of "public welfare statutes," often environmental violations.

In an alarming new trend, mid-level employees, without a real stake in the corporate entity for which they work, are increasingly being charged with, and often convicted of, crimes involving conduct taking place outside of their presence and without their involvement or decision-making.

Individual Liability For Corporate Crimes

Pursuing owners and high-level executives for their companies' criminal offenses arguably serves several legitimate governmental and societal interests. Holding high-ranking individuals criminally responsible might deter criminal conduct in corporate settings because if fines incurred are lower than profits derived from the criminal violations, companies lack the financial incentive to correct conduct that may violate the environmental laws.

However, seeking criminal penalties against mid-level employees serves no legitimate purpose from a public policy standpoint. Often, the employees charged lack the discretion to affect the decisions at issue and are simply not capable of bringing about change in the conduct of their companies. In addition, charging and convicting mid-level employees implicates their right to due process and may be unconstitutional. In many cases, employees are criminally charged and convicted under standards that amount to mere negligence or even strict liability, in direct contravention of the standards enunciated in the applicable case law on individual liability for corporate acts.

The United States Supreme Court set forth the standard of proof required to hold an individual liable for corporate misdeeds in United States v. Dotterweich, 320 U.S. 277 (1943). In Dotterweich, the president and general manager of a pharmaceutical company was convicted of negligently shipping misbranded and adulterated drugs. The United States Supreme Court ruled that Dotterweich should have been aware of the possibility of a violation and should have exercised due care, but failed to do so. The Court held, however, that a finding of corporate guilt should extend only to those individuals who had a "responsible share in the furtherance of the transaction which the statute outlaws." Id. at 284. In other words, the burden of acting is placed upon a person otherwise innocent but standing in a responsible relation to a public danger.

This standard subsequently...