Shutting down of business

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key88crazy
key88crazy's picture

 I have heard Tom talk many times about how government used to close business that were not acting in the interests of the community. I can not find references for this anywhere on the internet?

Was it local government that did this?

Can anyone help me find out more information about this, I would love to cite this.

 

Thank you

Jason

 

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reed9
reed9's picture
it's the State Attorney

it's the State Attorney General who has the power to revoke corporate charters, as I understand it.

There are many websites which describe the situation much as Thom has, but I couldn't find any neutral sounding information on the topic.

So here is a liberal slanted article.  And here is a libertarian slanted article.

Art
Art's picture
Quote:it's the State Attorney

Quote:
it's the State Attorney General who has the power to revoke corporate charters, as I understand it.
I'm not so sure that the revocation of corporate charters is still a practical possibility. According to this Wikipedia article, an 1819 Supreme Court decision, "granted corporations a plethora of rights they had not previously recognized or enjoyed.[13] Corporate charters were deemed "inviolable", and not subject to arbitrary amendment or abolition by state governments.[14]"

This was not the Santa Clara County v Southern Pacific Railroad decision that Thom cites. (It will take a little Googling to chase this down).It might be worth noting that a Corporate charter is not necessary just to do business, only to enjoy the benefits of a charter. Additionally, for many of the Corporations we are most concerned about, a state charter is largely irrelevant. They "reside" offshore, pay no US taxes, use foreign workers, and are effectively not even American in any meaningful sense.They cannot be killed.

Art
Art's picture
 Well, here's an article

 Well, here's an article about Trustees of Dartmouth College v. Woodward.

New hampshire had attempted to turn the college into a public school by trying to replace the board of trustees with state-appointed trustees. This would have altered (revoked) the original charter of the college. The Supreme Court decided that this would have violated the sanctity of contracts. Because the original charter contained no language about the possibility of revocation, it could not be allowed.

However, "After the Dartmouth decision, many states wanted more control so they passed laws or constitutional amendments giving themselves the general right to alter or revoke at will, which the courts found to be a valid reservation [3] [4]. The courts have established, however, that the alteration or revocation of private charters or laws authorizing private charters must be reasonable and cannot cause harm to the members (founders, stockholders, and the like)"

Frankly, I'm not sure where that leaves us in 2010.