Corporate Criminal Liability in the United States: Is a New Approach Warranted?

Abstract

In the United States, under both federal and state law, corporations as well as individuals may be held criminally liable for wrongful acts. This doctrine of corporate criminal liability, based upon the civil law system’s doctrine of respondeat superior, is created by courts through the common law. This chapter studies the current US practice of the principle in a historical context. The US Department of Justice’s role in charging corporations is examined, with special reference to deferred prosecution and non-prosecution agreements, as stated in pertinent cases. The paper also discusses the current reform proposals, including congressional initiatives. Although the strict application of the respondeat superior principle to corporate behavior in a criminal context is at present entrenched in the US legal system, the paper concludes with a recommendation that the Model Penal Code approach – including the “due diligence” standard – be adopted. Under that approach no liability would attach if “the high managerial agent having supervisory responsibility over the subject matter of the offense” used due diligence to prevent the commission of the wrongdoing Under this recommendation, the respondeat superior standard would be applied only when a legislative purpose to impose such liaiblity “plainly appears.”