Corporate Speech and the Omnipresent Specter of Political Bias

This post was originally intended to be submitted as a comment to Ann Lipton’s recent “Don’t Say Anything” post – so please read that post first before continuing. I ultimately decided to publish this as a free-standing post because it got a bit long for a comment and I’ll be better able to follow any subsequent comments here. As always, I remain open to changing my mind in the light of convincing feedback.

Ann’s post starts by referencing “Florida’s ‘Don’t Say Gay’ law, HB 1557.” For context, the following from Heritage Action's Executive Director Jessica Anderson (here) may be helpful:

While the Left and the corporate media continue to lie about Florida’s Parental Rights in Education bill, HB 1557, Florida Republicans haven’t stopped working to protect parents and children. Nothing in the bill bans the word ‘gay’ or censors schools — it simply protects grades K-3 from sexualized instruction and bolsters parents’ rights to know what’s going on in their children’s lives at school.

As for the substance of the case, I predict that Chancery will not dismiss the request. Why? Because it does not have to dismiss it in order to discourage “bullying” because this is not properly dismissed as bullying (i.e., an improper purpose). Simeone is certainly not the only shareholder to be concerned about Disney’s decision possibly being tainted by political bias – and this request is a proper way to try to get at the truth on that issue. What’s the most likely form of circumstantial evidence of political bias in a case like this? I believe it is failures of information-gathering that conveniently tilt in only one partisan direction. For example, if the decision-makers utterly failed to even consider simply firing the disruptive employees as a way to restore order at the company, or if they utterly failed to account for the completely foreseeable costs of backlash – in the form of state action or an even bigger PR nightmare – for trying to undermine the decisions of a democratically elected governor arguably doing precisely what he was democratically elected to do (cf. "Nikki Haley Says Florida’s Parental-Rights Law Doesn’t Go ‘Far Enough'"), then we start to get smoke suggesting a fire of politically biased willful blindness. Phrased more conventionally, if the corporate decision-makers failed to properly inform themselves in the course of reaching their decision, then they breached their duty of care, and if their information-processing failures rose to the level of consciously disregarding their known duty to become fully informed, then they engaged in non-exculpable bad faith. Given the highly politicized nature of this dispute, and the specter of political bias it raises, granting the request here seems perfectly in line with Section 220’s purpose and precedents. FWIW, I have previously written about the need for enhanced scrutiny in cases like this here, here, and here; Senator Marco Rubio has linked to some of that work here.

As for the concern that granting this request will somehow sanction improper or illegal “bullying” of corporations by political actors, I don’t think corporate decision-makers can ignore likely material impacts of political actions simply because they believe those actions may ultimately be deemed illegal. For example, should corporate decision-makers ignore the potential costs/benefits of President Biden’s loan forgiveness program because it may ultimately be ruled illegal? I think not.