Beware of Stealth Attacks
on Your State's Constitution

For more than sixty years, corporate lawyers within the American Bar Association have promoted its "Model Corporation Act" which has become the basis for corporation law in most states. They seek ongoing changes--nearly always packaged with the label of "modernizing" the law--to usurp democratic authority over corporate charters, stock issuance, criminal actions by corporate officials, corporate structure and other vital issues.

The corporate lawyers refer to "antiquated" laws that haven't been enforced in decades as if that necessarily was a legitimate reason to strike, rather than enforce them. They argue the state must compete with other states to lure corporations by lowering their standards to the lowest common denominator--a practice akin to price-competitive prostitution.

Are corporations that seek out a state with the weakest protections for its citizens really companies worth wooing?

The campaign to dilute state authority over corporations has been extremely successful; most bills have passed or partially progressed through the system before any public interest group was aware of the maneuver.

We speak from experience-we were unaware that such an effort was underway in Colorado (our national headquarters at the time) until we received a call days after the bill already had passed through House committee. Calls to public interest groups revealed that they also were unaware of the bill's significance.

The proposed bill in Colorado, HCR 1003, would have struck four provisions from our state Constitution, including rescinding legislative authority over corporate charter revocation.

We immediately contacted the bill's chief sponsor to request a hold on the bill and disseminated this press release to shine some light on the issue. Our efforts succeeded in persuading the bill's sponsor, Representative Alice Madden (D-Boulder), to pull the bill from consideration before a vote by the full house, despite her protests that our concerns were unwarranted (she generally is considered a liberal Democrat).

We offer below several documents to help you gain an understanding of this process and be on guard against it happening in your state.

Read the bill text and the arguments forwarded by the bill's sponsor's (pdf)

Read ReclaimDemocracy.org's first press release on the bill.

For a related story on the undermining of corporate accountability in New Mexico, see this article, culled from the recently published book Defying Corporations, Defining Democracy from the Program on Corporations, Law and Democracy. The book also tells a similar story from Ohio, where citizens learned of the attack against their corporate accountability codes too late.

Thanks to Greg Coleridge, Walt Kramarz, Thomas Linzey, Dean Ritz and Richard Grossman for their rapid response to help us win this necessary defensive battle.