Tuesday, June 15, 2010

Mass State Court Rejects Collective Knowledge

In determining the mens rea under corporate criminal liability, federal courts have sometimes used a theory of "collective knowledge." In U.S. v. Bank of New England, 821 F.2d 844 (1st Cir. 1987), the court found that the knowledge of a corporation "is the sum of the knowledge of all of the employees." This appears not to be the case in Massachusetts state court, which held in Commonwealth v. Life Care Centers of America, Inc., 926 N.E.2d 206 (2010), that "this theory is illogical and such an argument cannot succeed.  If at least one employee did not act wantonly or recklessly, then the corporation cannot be held to a higher standard of culpability by combining various employees' acts."  The court notes several federal cases that have not endorsed collective knowledge, and also notes that this case is different from the Bank of New England case because it does not involve a Federal regulatory offense. In this case the crime charged was involuntary manslaughter, which the court noted "requires an act taken in disregard of a high probability of harm to others so that the act is wanton or reckless."

(esp)(w/a hat tip to Professor Robert Batey)

http://lawprofessors.typepad.com/whitecollarcrime_blog/2010/06/mass-state-court-rejects-collective-knowledge.html

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