Opinion | March 15, 2023
CLEVELAND HEIGHTS, Ohio — A jury’s guilty verdict against former Ohio Speaker of the House Larry Householder for receiving bribes to pass House Bill 6 to bail out two failing FirstEnergy Corp. nuclear power plants at a cost to ratepayers of more than $1 billion should result in significant jail time. The same goes for every other individual involved in the scandal.
This is also true for FirstEnergy, which admitted in its 2021 Deferred Prosecution Agreement with federal prosecutors to paying, including through then-subsidiary FirstEnergy Solutions (FES), more than $59 million to Generation Now, the dark-money front group controlled by Householder. Those funds didn’t come out of the pockets of FirstEnergy executives. They came directly from the FirstEnergy and FES treasuries.
FirstEnergy’s agreement to pay a $230 million penalty as part of that 2021 agreement is nowhere close to proportionate accountability for the massive scale of its perversion and hijacking of our democratic system. It also does not prevent the state of Ohio from pursuing separate legal action against the company.
A corporation is a legal entity, publicly chartered or licensed, in most cases, at the state level. FirstEnergy Corp. is chartered in the state of Ohio.
Corporate charters, originally issued one at a time by state legislatures, identified specific conditions that had to be followed. Charters were similar to licenses issued to individuals who want to practice their profession – establishing specific rules and standards to ensure public safety and welfare.
When a corporation acted beyond their authority as defined in its charter, or illegally, its charter was revoked by the legislature or state Supreme Court and the company was dissolved. This is similar to a professional whose license is revoked for inappropriate or illegal acts.
The Ohio Supreme Court, for example, stated in a 1900 corporate charter revocation decision:
“The time has not yet arrived when the created is greater than the creator, and it still remains the duty of the courts to perform their office in the enforcement of the laws, no matter how ingenious the pretexts for their violation may be, nor the power of the violators in the commercial world.”
A Republican attorney general, David K. Watson sought to dissolve the Standard Oil Co. of Ohio franchise in the 19th century — the largest and most powerful company at that time. He asserted in his legal brief:
“Where a corporation, either directly or indirectly, submits to the domination of an agency unknown to the statute, or identifies itself with and unites in carrying out an agreement whose performance is injurious to the public, it thereby offends against the law of its creation and forfeits all right to its franchises, and judgment of ouster should be entered against it.”
Current Ohio Attorney General David Yost has filed a civil suit against FirstEnergy under the Ohio Corrupt Practices Act. The weak suit doesn’t call for the revocation of FirstEnergy’s charter.
FirstEnergy’s charter, which states it will act legally, should be revoked for the corporation’s admission of its direct involvement in what was called “likely the largest bribery, money-laundering scheme ever perpetrated against the people of the state of Ohio” by then-U.S. Attorney David M. DeVillers.
Issuing a fine or demanding that the company replace one or more directors or board members does nothing to affirm the original intent of charter issuance and revocation: That “We the People” have the power and authority to define and hold our legal creations accountable for their actions to ensure that the public is protected from corporate harms.
The lack of historical knowledge of corporate charter revocation, belief that holding accountable individual corporate “bad apples” is sufficient and the perception that charter revocation is too extreme are reasons why this democratic tool has not been explored in this case. Yet, revoking FirstEnergy’s charter is an appropriate and proportionate response to the scale of the company’s crime. It’s also how authentic self-governing people act to affirm real democracy against corporate rule.
The time has still not yet arrived when the created is greater than the creator.
Greg Coleridge of Ohio is national co-director of the Move to Amend Coalition that seeks to end corporate personhood via an amendment to the U.S. Constitution.
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