H.R.4973 96th Congress, 1st Session
The Corporate Decency Act

I. TITLE The Corporate Decency Act

II. SHORT TITLE A bill to amend Section 000 of the State Code to
establish new requirements for corporate entities and corporate
officials and to impose new penalties on corporate entities and
officials that violate existing state law and the provisions of this Act.

III. PURPOSE To establish a system of corporate governance that better
protects employees and the public at large from corporate lawbreakers
and that leads to greater compliance with existing civil and criminal law.

IV. ENACTING CLAUSE Be it enacted by the State that Section 000 of the
State Code is amended by adding at the end the following new section.
The Act may be cited as the Corporate Decency Act.

V. FINDINGS The legislature finds that -

A. Current state corporation provisions, and traditional criminal law
sanction of fines and imprisonment, do not adequately deter lawbreaking
by companies or their executive officials. In fact, penalties against
corporate officials are far less severe than those against ordinary
lawbreakers; fines are nominal, prison sentences are frequently
suspended, and probation is easily granted;

B. Industrial plants that abruptly close down or relocate can disrupt a
local economy's employment structure and tax base;

C. Many company employees can now legally be dismissed for the exercise
of their political rights of speech and assembly;

D. The limited disclosure of information regarding corporate entities'
economic and social impacts deny various people, groups and communities
vital information about practices that greatly affect them; and

E. The cost to society of corporate lawbreaking, to the extent that in
can be quantified, evidences the need for a more comprehensive legal
framework to increase compliance with the law by corporations. Corporate
crime costs run into billions of dollars. These costs involve not only
large financial losses but also injuries and health hazards to workers
and consumers. Over 75 percent of all corporate crimes are in the
environmental and labor protection areas.

VI. JURISDICTION Any state court or administrative tribunal of
appropriate jurisdiction shall have the authority to offer declaratory
or equitable relief for any violation of this Act. Individuals may
commence an action in a state court of appropriate jurisdiction or
before an administrative tribunal in the event that the state official
charged with enforcing any provision of the Act fails to do so whether
the individual is or is not specifically aggrieved by a violation of the

VII. STANDING Any person has standing to bring a claim in a state court
of appropriate jurisdiction or before an administrative tribunal
challenging any act or conduct of a person that threatens to cause or is
causing substantial harm to the public.

VIII. ATTORNEYS FEES The court may grant such relief as it deems
appropriate and shall award reasonable costs of litigation, including
attorney's fees and other reasonable costs of litigation if a party
substantially prevails in a court of final jurisdiction, or the court
determines that such action served an important public purpose, or
either party can demonstrate that its economic interest is small in
comparison to its costs of effective participation or that it lacks
sufficient resources to participate in the action absent the award.

IX. EFFECTIVE DATE This Act shall become effective the first calendar
year commencing six months after its enactment.


    A. "Person" means any individual, governmental entity (including any
state or political subdivision or department or public agency thereof),
or corporate entity as defined herein.

    B. "Corporate entity" means any corporation, individual
unincorporated association, partnership, authority, or local government
organized or doing business in the state.

    C. "Serious danger" used with respect to a product or business
practice, means that the normal or reasonably foreseeable use of, or the
exposure of human beings to, such product, practice or service will
cause death or serious bodily injury to an individual.

    D. "Serious bodily injury" means any impairment of physical or
mental condition, including physical pain, a substantial risk of death
or serious permanent disfigurement, unconsciousness, extreme pain, or
permanent or protracted loss or impairment of the function of any bodily
member or organ.

    E. "Warn or notify" used with respect to employees, the public, or
the community, means to give sufficient description of the danger to all
individuals working for or in the corporate entity, those who are likely
to use a product or service, and those who are or who are likely to be
in the proximity of the serious danger.

    F. "Appropriate state agency" means a state agency having regulatory
authority or enforcement powers with respect to the product, service or
practice and dangers of the sort discovered.

    G. "Corporate official" means an appropriate manager having
management authority or enforcement powers with respect to the product,
service or practice, a corporate officer, a member of the board of
directors, or an agent of the corporate entity.

    H. "Discover" means obtains or has information that would alert a
reasonable person in the circumstances in which the discoverer is
situated that it is probable that a serious danger exists.

    I. "Class One Offense" means any offense or violation by a corporate
official or those responsible to a corporate official that is knowingly
committed or that the corporate official on the balance of probabilities
should have known would be committed that results in the death of a pon
that is recklessly or negligently committed by a corporate official or
those responsible to a corporate official, or is knowingly committed or
that the corporate official on the balance of probabilities should have
known would be committed but that does not result in the death of a
person or serious bodily injury.

XI. ADMINISTRATIVE AUTHORIZATION The Secretary of State and all agencies
charged with duties under this Act are authorized to make and amend such
rules and regulations as may be necessary to carry out the provisions of
this Act.

XII. CONFLICTS The rights and remedies provided for in this Act shall be
in addition to and not in lieu of any other rights and remedies provided
by common law or under state law.

XIII. PREEMPTION This Act shall preempt local law to any extent local
law is inconsistent, unless the relevant sections of local law are at
least as protective of public health and welfare as the provisions of
this Act and in all cases, provisions of this Act must be liberally
construed to benefit the party bringing an action under the Act.

XIV. SEVERABILITY If any provision or application of this Act to any
person or circumstance is held invalid does not affect other provisions
or applications of the Act which can be given effect without the invalid
provision or application, and to this end the provisions of the Act are


A. CONCEALMENT It shall be unlawful for any corporate entity or
corporate official to conceal from authorities any product or process
that [results] in death or serious injury. This offense shall be
considered a Class One Offense under the Act.

B. HOMICIDE It shall be unlawful for any corporate entity or corporate
official to engage in conduct which results in death, which such
corporate entity or corporate official knew or should have known would
result in death, or which was reckless or negligent. This offense shall
be consid for any corporate entity or corporate official, to knowingly
or negligently endanger the public. This offense shall be considered a
Class Two Offense under the Act.

any corporate official to destroy or falsify documents or to negligently
allow the destruction of documents pertaining to hazards to the public,
or the corporate entity's employees or agents. This offense shall be
considered a Class Two Offense under the Act.

for any corporate official to discriminate against, retaliate against,
or deprive an employee of employment, employment benefits, employment
opportunities, or any other rights secured under the laws of the state
because of the employee's involvement in or participation in any of the
following activities:

1. Filing, instituting, or causing to be filed or instituted any
investigation or proceeding resulting from the administration or
enforcement of any federal, state, or local statute, regulation or
executive order;

2. Assisting or participating, or being about to [preparing to] assist
or participate in any manner in any proceeding or action to carry out
the purposes of this Act;

3. Communicating to, or providing any information to any employer, or
employer's agent, regarding a violation, or suspected violation, of any
federal, state, or local statute, regulation or executive order;

4. Participating in any federal, state or local government investigation
or other proceeding; and/or

5. Opposing any practice made unlawful by any federal, state, or local
statute, [law,] regulation or executive order

Upon suit being brought for violations under this provision, the
defendant employer must clearly and convincingly prove the action was
not with malice or in bad faith. This offense shall be considered a
Class Two Offense under the Act.


LICENSED IN THE STATE Any corporate entity organized or doing business
in the state shall have good corporate character. A corporate entity
that through its action or inactions evidences an absence of ethics or
virtue, or tendency to habitually engage in activities which are
detrimental to the public health, safety, or welfare including, but not
limited to,: patterns of misconduct, disregard for the law or government
regulations designed to protect the public, failure to prevent deceptive
practices, the abdication of responsibility, disregard for government
reporting requirements, involvement in lawbreaking in any area of
activity, lack of candor and forthrightness with governmental agencies,
criminal activity, or patterns of regulatory violations shall result in
the corporate entity being in violations of this provision.

Any conduct shall be probative of character which illuminates the
likelihood of prospective conduct and probable performance, including
whether the misconduct is an isolated incident or reflects a pattern of
misbehavior, and how recently the misconduct occurred.

The Secretary of State shall require submission of proof of character as
a condition of allowing the corporate entity to do business in the
state. The Secretary may at any time require supplemental written
character reports in order to enable the Secretary to determine whether
the corporate entity continues to meet the state's character
requirements. A violation of this provision shall be considered a Class
Two Offense under the Act.


entities shall provide workers, consumers and the public with
information on the hazardous substances in the workplace, community and
environment, and establish emergency planning and notification plans
which would alert the public in the event of a release of hazardous

Information to be provided includes:

      Where, and in what amounts hazardous substances are generated,
transported, stored and used;

      How hazardous substances are recycled, treated or stored;

      The acute and chronic health effects and symptoms the hazardous
substances are likely to produce [upon exposure];

      Explosiveness and flammability and toxicity of any combustion

      Reactions produced when hazardous substances are mixed with water
[or with other substances stored in the same locality];

      The nature, location [and age] of hazardous substance storage

      The major transportation routes, [transporting containers] and
evacuation routes that are or would be used with respect to hazardous

      Safety equipment and medical equipment needed to deal with an
accident; and

      The exposure routes, and proper handling procedures for hazardous

A violation of this provision shall be considered a Class One Offense
under the Act.

2. VICTIM NOTIFICATION Corporate entities shall notify those who may
[forseeably] be adversely affected by potential health or safety dangers
associated with any product, practice or service of the corporate
entity. A violation of this provision shall be considered a Class One
Offense under the Act.

3. EXECUTIVE RESPONSIBILITY Corporate officials must notify employees,
agents and sub-contractors and appropriate government agencies if a
serious danger exists in handling or using a particular product or
service, within 30 days of discovering the danger. A violation of this
provision shall be considered a Class One Offense under the Act.

4. PLANT CLOSING If a corporate entity intends to close or transfer any
of its operations, resulting in a loss of employment of 500 or more
persons or 20% of the total labor force within a geographically
continuous area, or 20% or more of the labor force of a standard
metropolitan statistical area, whichever is smaller, it shall furnish
the Secretary of State, the Secretary of Labor, affected employees and
community representatives written notice of the timing and extent of
such a closing or transfer not less than 24 months in advance. It shall
publish in a local medium any plan to relocate or rehire affected
employees, except where the Secretary of State finds that the corporate
entity could not reasonably have predicted its intention to close or
transfer, in which case the Secretary of State may allow such shorter
notice as may be reasonable under the circumstances.

The Secretary of State has the authority to appoint an arbitrator with
subpoena power to hold hearings in the affected community in order to
make findings of fact concerning (a) the economic reasons for the
closing or transfer, (b) any non-economic reasons, (c) and the potential
economic, social and environmental cost of the abandonment to the
affected community. These hearings will produce a community impact
analysis to be forwarded to the Secretary of State, and included in a
yearly report from the Secretary of State to the state legislature
summarizing the causes and effects of plant closings and relocations.

The corporate entity will be liable for the loss of revenue to the city,
county or state government in a percentage equal to one year's tax
revenues lost as a result of such transfer or closing; severance pay for
workers; and community assistance for areas they are leaving. In
addition, the corporate entity receiving the benefits must provide
retraining for its workforce in the event of plant closings. Corporate
entities must also offer the local community the right of first refusal
on the facility being abandoned, and pay the State the value of any tax
credits and or tax abatements received by the corporate entity that have
not expired.

(b) Closure report

Upon the permanent cessation of production operations at a Department of
Energy defense nuclear facility, the Secretary of Energy shall submit to
Congress a report

    (1) a complete survey of environmental problems at the facility;

    (2)budget quality data indicating the cost of environmental
restoration and other remediation and clearup efforts at the facility; and

    (3) a discussion of the proposed cleanup schedule.


a. ANNUAL REPORTS Every corporate entity incorporated or doing business
in the state, whether foreign or domestic, must provide the Secretary of
State by December 31 of each year:

1. The names, addresses, and number of shares held by the twenty largest
shareholders and an list of, in descending order, the twenty largest
beneficial holders of voting shares in the corporate entity excluding
any holder with less than one-tenth of one percent of the outstanding
shares. For each stockholder, the annual report shall list the name,
address and type (bank, broker, holding company, individual or trust),
the number of voting shares held (as of the end of the calendar year),
and the number of shares over which the holder has sole voting power,
shared voting power, or no voting power under any circumstances. In
determining the number of shares held, all nominee and other accounts of
each shareholder, including the accounts held be depository trust
company, shall be aggregated and reported as one account in the name of
the bank, broker, holding company, individual, or other identified
shareholder. For each revolving credit agreement, the corporate entity
shall report the total amount available, the commitment fee and the
average monthly amount outstanding during the previous year.

Performance by geographic center, reporting its assets at year end,
gross revenue, total expense, income tax, net income, number of US
employees, and number of non-US employees for the following geographic
regions: North America (excluding US), Asia-Australasia, Europe, Middle
East, Latin America/Caribbean, Africa, total international, total
domestic and total worldwide. The firm shall also report the same
figures by country for the four countries (excluding the US) in which
the firm and its subsidiaries have the largest sales and assets.

2. All political action committee contributions and the amount of money
given to each individual candidate;

3. Information on employment patterns, environmental matters, job safety
and health, foreign production, shareholder ownership, the time and
place of all shareholder meetings and yearly local, state, and federal
tax payments, including: For each of the five largest of its facilities
which report to the Environmental Protection Agency and to state health
authorities on air and water pollution, the firm shall indicate in its
annual export its actual average daily emissions and effluents for each
pollutant required to be reported under the federal Clean Air Act and
Clean Water Act. In addition, the corporate entity shall list in its
annual report any outstanding environmental legal actions at each of
these facilities.

Each corporate entity shall indicate in its annual report the total of
all occupational injuries and illnesses incurred. This total will be
based on data recorded on the plant-wide Occupational Safety and Health
Administration Form 200 or its equivalent, and aggregated for all plants
owned and operated by the corporate entity. If a corporate entity
manufactures a chemical product that is identified only as a trade named
substance, disclosure of the chemical constituents of the substance
shall be provided upon request of any stockholder of record or employee
of the corporate entity.

4. All criminal convictions, and all pleas of nolo contendere;

5. All civil infractions and verdicts against the corporate entity and
all of the violations of local, state and federal statutes, regulations,
or executive orders; and

6. The status of its compliance with all federal, state and local health
and safety laws, including occupational safety and health laws,
environmental protection laws and equal opportunity laws. The
distribution of the workforce by sex, race and job classification in the
same format as that required to be reported to the Equal Employment
Opportunity Commission in the EEO-1 Consolidated Report or its
equivalent. In addition, the category, of officers, shall be added to
the present nine job classifications, and the net increase or decrease
over the previous year in the number of employees at year end in each
category shall be indicated.

A violation of this provision shall be considered a Class Two Offense
under the Act.

ADJUDICATED Any corporate entity that settles a case involving health or
safety information, shall make available to the Secretary of State any
material contained in sealed records that could be useful in preventing
the endangerment of the public at large. A violation of this provision
shall be considered a Class Two Offense under the Act.

c. INSURANCE DISCLOSURE Any property/casualty insurance company
incorporated or doing business in the state shall identify and make
available to the public, relative to each claim and/or disputed injury
the following:

(1) The physical hazard or unsafe condition that resulted in the claim;

(2) The make and model of the product, or service, that served as host
for the hazard by category to assure for its easy and accurate

(3) The hazardous material, substance or service by both brand and
generic name any offending chemical content that could cause harm.

This information an annual summaries of all death or injury-related
occurrences shall be transmitted to the State Insurance Commissioner and
to the Secretary of State on or before the last day of each year. A
violation of this provision shall be considered a Class Two Offense
under the Act.


1. NOTIFICATION A violation of any of the following provision shall be
considered a Class Two Offense under the Act.

(a) Corporate entities must individually notify, by mail, all
shareholders of all criminal convictions, nolo contendere pleas, and
civil sanctions incurred by the corporate entity whenever proxy
materials are distributed, or in the event that no proxy materials are
distributed , by mail to all shareholders at least once a year.

(b) Upon request by a shareholder of record, the corporate entity shall
provide a description of each long term debt (debt due after one year)
and revolving credit agreement of the corporate entity in excess of one
million dollars. The corporate entity shall include the name of the
creditor, the character of the debt, the nature of the security if any,
the date of origin, the date of maturity, the total amount of the debt,
the rate of interest, and a copy of any and all restrictive covenants
attached to the indebtedness.

(c) Upon request by any shareholder of record, or member of the public,
the corporate entity shall provide copies of its discharge monitoring
reports, as filed monthly with the EPA, and its emissions inventories,
as filed semi-annually with the state and local agencies, for any and
all of the firm's facilities.

(d) Upon request by an shareholder of record, or member of the public,
the corporate entity shall provide EEO-1 reports for any or all of its

2. CONSTITUENCY BOARD Every corporate entity subject to this Act shall
have at least nine board members, in addition to their traditional
fiduciary obligations, with responsibilities to oversee, investigate,
receive complaints about and address the board on matters affecting,
respectively, 1) employee well-being 2) consumer protection, 3)
environmental protection, 4) community relations, 5) shareholder rights,
6) law compliance, 7) technology assessment, 8) anti-trust standards,
and 9) political relations.

3. BOARD COMMITTEES Every corporate entity subject to this Act shall
have an Audit Committee, Nominating Committee, a Compensation Committee,
a Public Policy Committee and a Law Compliance Committee, all of which
shall be comprised of independent directors, except for the Public
Policy and Law Compliance Committees, which shall have a majority of
independent directors.

4. SHAREHOLDER NOMINATIONS AND VOTES Shareholders of every corporate
entity subject to this Act shall have the right to nominate candidates
for the board of directors if such candidates are supported by a
reasonable absolute minimum number or percentage of shares, to be
determined by the Securities and Exchange Commission. Only the actual or
beneficial owners of stock are eligible to nominate a candidate or to
vote for candidates. The corporate entity would provide equal funds to
all nominees - the maximum amount to be determined by the Secretary of
State. At least six weeks prior to a shareholders' meeting to elect
directors, each shareholder shall receive a ballot and brief written
statement by each candidate as to their qualifications for the position.

5. SHAREHOLDER REVIEW Shareholders of any corporate entity subject to
this Act shall be entitled to vote on any transaction involving the
purchase, sale, lease, merger, consolidation, financing, refinancing,
dissolution or liquidation of assets equal to ten percent of the
corporate entity's total assets, or the sale or redemption of ten
percent of the company's outstanding stock, or the authorization of
corporate stock or securities in any amount. At least six weeks before a
shareholder vote on such a matter, the board shall forward a written
statement to all shareholders indicating the vote of directors on the
issue, reasons form the majority for their approval, reasons from the
minority for their disapproval, and the foreseeable benefits and risks
of implementing the proposal.

6. CUMULATIVE VOTING Every shareholder of any corporate entity subject
to this Act entitled to vote at any directorial election may cumulate
such shareholder's votes and give one candidate a number of votes equal
to the number of directors to be elected, multiplied by the number of
votes to which the shareholder's shares are entitled. Classification, or
the staggered election of directors which have the effect of undermining
the cumulative voting's purposes of minority representation, are prohibited.

D. TRUTH IN BIDDING Any corporate entity receiving tax abatements, tax
credits or subsidies must enter into a legally binding contract with any
governmental entity providing these benefits, stating the precise
benefits the corporate entity will provide in exchange for the benefits
conferred by the state. In those cases where the corporate entity is
providing jobs - the number of jobs, the job level, the salary by level,
and the duration of the jobs must be made public.

E. RECALL OF DIRECTORS In the event that a corporate entity engages in
criminal activity and is convicted or pleads nolo contendere, any
shareholder shall be entitled to a full list of the shareholders of all
classes of stock. The list shall be furnished to any shareholder seeking
to notify other shareholders that a recall of the current officers and
directors is in order. The cost of furnishing the list and mailing such
notices shall be borne by the corporate entity.

directors of each corporation doing business or incorporated in the
state must be independent. An independent director is one who is not,
and was not within the past five years, an officer or an employee of the
firm or any of its parents, subsidiaries or affiliates; is not a
relative of an executive officer of the firm by marriage, blood , or
adoption ( unless more remote than first cousin); does not have any
equity interest in the firm; is not a lawyer who currently or in the
past five years has received a fee from the firm; is not a director,
partner, officer or employee of an investment or commercial banking firm
which in the past five years has performed services for the firm; is not
and has not been an officer, director, employee or more than one percent
equity owner of a supplier or customer who received more than one
percent of its consolidated gross revenued or more than $5,000,000 per
year, whichever is less, from a corporate entity affected by this Act.
The board of directors collectively shall be provided with such support
staff reportable solely to itself, as it deems necessary to fulfill the
board's responsibilities.



1. ENDANGERMENT A corporate official who knowingly conceals a dangerous
product or business practice shall be sentenced up to 10 years in prison
or fine of $250,000.

2. CORPORATE HOMICIDE A corporate entity or corporate official engaging
in conduct where the corporate entity knew or should have known that
death could result, or was reckless or negligent, that resulted in
death, shall be subject to prosecution under the homicide act of the state.

3. CHARTER REVOCATION Any corporate entity convicted of a Class One
Offense shall have its charter revoked or suspended for no less than 30
days. Each additional infraction within a year shall result in a
doubling of the suspension period.

4. EQUITY FINES Any corporate entity violating any provision of this Act
may be required to authorize and issue to the state treasury shares of
stock equal to the value of fines or such number of shares to the
state's crime victim compensation fund as would be necessary to deter
any violation of this Act. The treasury shall then establish a special
crime victim compensation fund, and use the proceeds from the occasional
sale on the open market of the accumulated portfolio of the fund to
provide money for victims of corporate crimes who would not otherwise be

The fund directors may liquidate the securities in whatever manner
maximizes its return.

prohibited from providing any corporate entity that is convicted of a
Class One Offense from receiving any tax abatements, tax credits or
subsidies of any kind for a period of not less than one year.

prohibited from purchasing any goods or services from any corporate
entity that is convicted of a Class One Offense for a period of not less
than one year.

B. CLASS TWO SANCTIONS Any corporate entity that violated any part of
this Act may be subject to the following sanctions:

prohibited from providing any corporate entity that is convicted of a
Class Two Offense from receiving any tax abatements, tax credits or
subsidies of any kind for a period of not less than one year.

prohibited from purchasing any goods or services from any corporate
entity that is convicted of a Class Two Offense for a period of not less
than one year.

from investing state pension funds, any other state controlled funds in
any corporate entity that has been convicted of committing a Class Two
Offense for a period of not less than one year.

4. PUBLICITY SANCTION Any corporate entity violating any provision of
this Act may be required to publicize the details of its offenses in a
full page advertisement in the largest paper in the state and the
largest paper in any appropriate community.

5. COMMUNITY SERVICE Any corporate entity violating any provision of
this Act may be required to undertake a socially useful project using
its own skills and expertise.

6. PROBATION For a corporate entity in violation of any provision of
this Act, a court in its discretion may give a probation officer such
visitorial powers, create such positions within an organization, require
such financial and non-financial disclosure or appoint such special
receivers as is deemed necessary to protect against repeat offenses.

7. PUNITIVE INJUNCTION Any corporate entity or corporate official
violating any provision of this Act may be prohibited from engaging in
specified business practices or be required to revamp its internal
controls; develop a remedy for a problem introducing state-of-the-art
equipment or procedures; revise its screening procedures; use its
international facilities to audit the destination of products supplied,
to report back to the enforcement agency at periodic intervals and, if
necessary, to have those reports verified by an independent monitor.

8. RESTITUTION TO VICTIMS Any corporate entity violating any provision
of this Act may be required to pay restitution and/or treble damages to
any victim of the offense, and/or any other party [to be determined by
the court].

convicted of an offense committed in furtherance of the affairs of the
organization, the court may include in the sentence an order
disqualifying the corporate official from exercising similar functions
in the same and/or other organization for a period not in excess of the
authorized term of imprisonment for such offense, if it finds the scope
or willfulness of the official's illegal actions make it dangerous or
inadvisable for such functions to be entrusted to the official.

Any corporate official who serves on the board of a corporate entity
that is convicted of violating any criminal law shall be prohibited from
serving on any other board of directors in the state

10. EXECUTIVE DISCLOSURE Any corporate official convicted in a criminal
proceeding shall participate in statewide lecture series for grades
9-12. In this lecture series the corporate official will spend at least
two hours a day delivering a court approved lecture to students on the
need for corporate responsibility and the cost to society of the
criminal offense.


1. FLUID RECOVERY When a corporate entity has violated a provision of
this Act or any other law of the state and direct compensation of
individual class members is unfeasible the class-wide damages should be
aggregated and a single recovery fund should be created. This class-wide
recovery fund shall be used to compensate individual claimants as
appropriate, but only to the extent that doing so does not sacrifice the
interests of absentee class members - the remainder of any fund should
be distributed through cy pres. In selecting the cy pres remedy, the
preference should be for equitable trusts that operate to benefit past
injured classes and to alleviate the potential for injury to the public
in the future.


1. STRICT LIABILITY All corporate entities organized or doing business
in the state shall be held strictly liable for damages caused to
persons, property or chattel in the event that any product, practice or
service causes death, serious bodily harm, or destruction of or damage
to property or chattel.

where the board of directors of any corporate entity subject to this Act
have engaged in ultra vires activities (or have been reckless in
exercising their oversight duties) the shareholders on a pro rata basis
and the directors individually shall be liable for the actions of the
corporate entity.

3. ENTERPRISE LIABILITY Affiliated corporate entities involved in a
common enterprise should be treated as one entity if they are in reality
an integrated economic entity.

One who utters defamatory speech concerning a corporate official or
corporate entity shall be immune from liability notwithstanding the
falsity of such speech, unless such speech was made with knowledge of
its falsity, or reckless disregard for the truth.


A. MULTI-STATE TAX COMMISSION The state shall join the Multi-State Tax
Commission, a compact of states that share expenses for a joint audit
program to ensure full compliance with the state's tax laws.

authorized to take into account a corporate entities' world-wide income,
using a formula involving wages, sales and property taxes within the
state, and then apportion an appropriate amount of income to the state
for tax purposes.

C. CORPORATE OFFICIAL RESPONSIBILITY Where a corporate entity commits an
offense under this Act, any corporate official who directed, authorized,
assented to, acquiesced in or participated in the commission of the
offense is a party to and guilty of the offense and is liable for
punishment provided for the offense whether or not the corporate entity
has been prosecuted or convicted.


1. MANAGER ACCOUNTABILITY A corporate official's guilt is imputed from
the conscious disregard or recklessness in not stopping a wrongful act.

2. In any prosecution of an offense under this Act, it is sufficient
proof of the offense to establish that it was committed by an employee
or agent of the accused, whether or not the employee or agent is
identified or prosecuted for the offense.

E. BONDING The Secretary of State may require a corporate entity to post
such bond or pay such amount of money into an escrow account as will
ensure compliance with any order made pursuant to this Act or in the
event the corporate entity becomes insolvent or files for bankruptcy.

XX. EMINENT DOMAIN If at any time corporate entity is in violation of
this Act, the Secretary of State may require a corporate entity to show
cause as to why its charter should not be suspended and its assets
purchased by the state at fair market value.

XXI. ATTORNEY RESPONSIBILITIES In the representation of a corporate
entity, an attorney shall not conceal or knowingly fail to disclose that
which by law the attorney is required to reveal or disclose.

An attorney shall notify the board of directors of a corporate entity of
any violation of this Act or any other law by the client corporate
entity in writing within five days of discovering the violation.

XXII. STATUTE OF LIMITATIONS An action to recover damages for personal
injury, illness, death or injury to property caused by the latent
effects of exposure, direct or indirect, to a substance upon or within
the body, or upon or within property, may be commenced within five years
from the date of discovery of the injury, illness or death, whichever is
later. Provided, however, that where the injury or illness involves
damage to the respiratory system or other system, part or function of
the body caused by exposure to a substance, the effects of such exposure
being latent and not manifested upon exposure but thereafter resulting
in a disability, an action or proceeding to recover damages for such
injury or illness may be commenced within five years after taused by
such exposure.