As part of federal organizational sentencing guidelines enacted on 1 November 1991, the United States Sentencing Commission included organizational probation. This sanction allows courts to place convicted corporations on probation, with conditions designed to reduce the likelihood of future law violations and remedy the effects of the original offense. This article explores the history, development, and significance of organizational probation. Its statutory foundations, rejection of market logic, linkage to organizational theory, and approach to regulatory relations are identified as its theoretical strengths. The forces shaping this unexpected legal outcome, particularly legitimacy concerns on the part of the Sentencing Commission and a business strategy of opposing the Sentencing Commission itself, rather than its specific proposals, are also outlined. The conclusion addresses the prospects for enforcement of organizational probation.
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References
1.
1. Guidelines for sentencing individual offenders were enacted on 1 November 1987. Judicial compliance was limited, and the guidelines were ruled unconstitutional by 150 federal judges.
2.
2. Mistretta v. U.S., 109 S.Ct. 647 (1989). The vote was 8-1, with Justice Scalia dissenting due to a narrow reading of the separation of powers clause.
3.
J. J. Savelsberg , “Law That Does Not Fit Society: Sentencing Guidelines as a Neoclassical Reaction to the Dilemmas of Substantivized Law,”American Journal of Sociology, 97(5):1346 (1992).
4.
idem, “Lighter Corporate Sentencing?” ibid., 9 Apr. 1990; idem, “U.S. Panel Finishes Up Guidelines,” ibid., 6 May 1991.
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William S. Lofquist, “Crafting Corporate Crime Controls: The Development of Organizational Probation and Its Implications for Criminology” (Ph.D. diss., University of Delaware, 1992).
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6. U.S., Congress, House, Committee on the Judiciary, Subcommittee on Criminal Justice, Oversight on the U.S. Sentencing Commission and Guidelines for Organizational Sanctions, Hearings, 101st Cong., 2d sess., 7 Mar. and 24 May 1990.
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7. Interview with author, 2 Aug. 1991.
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8. Pub. L. 89-901, 80 Stat. 1516.
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idem , A Proposed New Federal Criminal Code (Washington, DC: Government Printing Office, 1971).
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10. Pub. L. 98-473, 98 Stat. 1987.
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11. Pub. L. 98-473, 98 Stat. 1976.
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12. 465 F.2d 58.
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13. M. A. Cohenet al., “Report to the U.S. Sentencing Commission on Sentencing of Organizations in the Federal Courts, 1984-1987,” in Discussion Materials on Organizational Sanctions (Washington, DC: United States Sentencing Commission, 1988).
14.
14. 18 U.S.C.§§ 3651-56. The imposition of probation on organizations was not contemplated when the Federal Probation Act was passed in 1925. Rather, the intention was to provide young individual offenders a lenient alternative to prison.
15.
15. See Richard Gruner, “To Let the Punishment Fit the Organization: Sanctioning Corporate Offenders through Corporate Probation,”American Criminal Law Review, 16(1):11-26 (1988).
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M. L. Levin , “Corporate Probation Conditions: Judicial Creativity or Abuse of Discretion?”Fordham Law Review, 52:637 (1984).
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17. U. S., Congress, Senate, S. Rept. 98-225, 98th Cong. 1st sess. (1983).
18.
18. A recent movement to disregard legislative history in interpreting statutes when the meaning of the statute is clear would seem to diminish the relevance of this background to possible future legal challenges to organizational probation. Ironically, this movement, termed new textualism, is led by Justice Scalia, the lone dissenter in Mistretta and a firm supporter of business autonomy from government interference. See W. N. Eskridge, Jr., “The New Textualism,”UCLA Law Review, 37:621-691 (1990).
19.
19. United States Sentencing Commission, “Sentencing Guidelines for Organizational Defendants,” 26 Apr. 1991.
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20. For a comprehensive discussion of the history and scope of corporate criminal liability, see K. F. Brickey, Corporate Criminal Liability (Wilmette, IL: Callaghan, 1984).
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Brent Fisse , “Reconstructing Corporate Criminal Law: Deterrence, Retribution, Fault, and Sanctions,”Southern California Law Review, 56:1141-1246 (1983).
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J. S. Parker , “Doctrine for Destruction: The Case of Corporate Criminal Liability” (Paper delivered at Cato Institute Conference on Corporate Sentencing, 31 Oct. 1991).
23.
23. 1 U.S.C. § 1.
24.
J. C. Coffee, Jr. , “Corporate Crime and Punishment: A Non-Chicago View of the Economics of Criminal Sanctions,”American Criminal Law Review, 17:419-478 (1979-80).
25.
25. U.S. Sentencing Commission, “Organizational Sanctions Working Group Memo on Methodology,” 16 Nov. 1990, p. 23.
26.
26. Graham Allison, Essence of Decision: Explaining the Cuban Missile Crisis (New York: Harper & Row, 1971), pp. 10-38.
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C. A. Wray , “Corporate Probation under the New Organizational Sentencing Guidelines,”Yale Law Review, 101(8):2017-2042 (June 1992).
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28. Allison, Essence of Decision, pp. 67-100.
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M. D. Ermann , “Ordinary Deadly Decisions: Why People, Organizations, and Events Cause Hazard Concealment” (Manuscript, University of Delaware, 1990).
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30. Edwin Sutherland, White Collar Crime: The Uncut Version (New Haven, CT: Yale University Press, 1983), p. 257.
31.
31. See Frank Pearce and Steve Tombs, “Ideology, Hegemony, and Empiricism: Compliance Theories of Regulation,”British Journal of Criminology, 30(4):423-443 (1990).
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Neal Shover , D. A. Clelland, and John Lynxwiler, Enforcement or Negotiation: Constructing a Regulatory Bureaucracy (Albany: SUNY Press, 1986).
33.
idem, Crime, Shame and Reintegration (New York: Cambridge University Press, 1989).
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34. The availability of state enforcement distinguishes this approach from self-regulation. For this latter approach, see J. A. Sigler and J. E. Murphy, Interactive Corporate Compliance: An Alternative to Regulatory Compulsion (New York: Quorum, 1988).
35.
35. For a comparison of the 1980s to other “capitalist blow-outs” in U.S. history, see Kevin Phillips, The Politics of Rich and Poor (New York: Random House, 1990).
36.
W. S. Lofquist , “Corporate Sentencing and the United States Sentencing Commission: The Development of Organizational Probation” (Paper delivered at the annual meeting of the Academy of Criminal Justice Sciences, Pittsburgh, PA, 13 Mar. 1992).
37.
37. Letter to author from M. A. Cohen, 5 Nov. 1991.
38.
Peter C. Yeager , The Limits of Law: The Public Regulation of Private Pollution (New York: Cambridge University Press, 1990).
39.
see also Leonard Orland, “Reflections on Corporate Crime: Law in Search of Scholarship,”American Criminal Law Review, 17(4):501-520 (1980).
40.
Irwin Ross , “How Lawless Are Big Companies,”Fortune, 1 Dec. 1980, p. 57; testimony of Amitai Etzioni before United States Sentencing Commission, 14 Feb. 1990.
41.
41. “Interview with John C. Coffee, Jr.,”Corporate Crime Reporter, 5:12 (Sept. 1988). Professor Richard Gruner expressed a similar view in an interview with the author, 31 July 1991.
