Center for Progressive Reform Scholars Support the Hide No Harm Act

June 18, 2014 | Download PDF

Dear Senator,

We, the undersigned, are Member Scholars with the Center for Progressive Reform (CPR), a research and education organization working to protect health, safety, and the environment. Collectively, we have several decades of experience in studying, writing about, and teaching about consumer protection and worker health and safety laws in law schools across the United States. Based on our extensive work in this policy area, we have identified a pattern of troubling behavior: Managers or other corporate officers, after becoming aware that their companies’ business activities pose significant dangers to their customers or workers, are increasingly choosing not to disclose those risks—or even actively concealing them—based on the determination that their narrow economic interests are best served by keeping the public in the dark. We now urge you to pursue robust legislative action to address these acts of outrageous corporate behavior.

The recent General Motors (GM) ignition switch scandal vividly illustrates the catastrophic consequences that can result when corporations fail to disclose the known dangers associated with their harmful business activities.   The now highly profitable auto manufacturer—$3.8 billion last year alone—determined that the estimated $2.3-million-fix for the problem ($0.90 fix for 2.6 million cars total) was just too costly to undertake. Instead, GM concealed the problem for more than a decade as part a concerted campaign that included repeatedly lying to its customers, the media, and the National Highway Traffic Safety Administration (NHTSA), the federal agency charged with overseeing car safety. All the while, GM’s customers continued to climb into cars that the company knew were not safe. GM admits that 13 people died in crashes caused by the faulty switch.

Similar to GM, other companies appear to have prioritized profits ahead of public well-being in this manner. The available evidence indicates that in 2007 and 2008

Peanut Corporation of America knew its peanut paste had tested positive for salmonella, but shipped it out anyway, ultimately killing 9 and sickening 714. Similarly, government-led investigations suggest that the New England Compounding Center—the compounding pharmacy that sold fungal-contaminated medication leading to the 2012 meningitis outbreak that killed 64 people and sickened at least 751 others in 20 states—knew that it was not taking adequate precautions to ensure that the drugs it produced and packaged were safe.

It is within Congress’s power to ensure that corporations are properly held accountable for putting the public at unnecessary risk by failing to disclose the dangers of the business activities. As morally reprehensible as this behavior is, corporations face strong economic incentives to leave their customers and workers in the dark. Too many corporations will continue to act according to those incentives, unless Congress enacts some form of legislation that makes the costs of not warning the public too great to ignore.

The Hide No Harm Act, sponsored by Sen. Richard Blumenthal, offers one sensible approach. The bill would make it a crime, punishable by large fines and up to five years of imprisonment, for a business and “any responsible corporate officer” to fail to disclose information regarding any dangers associated with their business practices within specified time periods after learning of the dangers. Specifically, the bill would require that warnings be provided, where applicable, to the “appropriate Federal agency,” their employees, and any other members who might be exposed to the danger. A key feature of the bill is that it would seek to hold individual corporate officers with the authority to address their company’s safety issues. This kind of accountability measure can be crucial, since many corporations are able to absorb even large fines as a cost of doing business.

If enacted, this bill would strongly discourage most companies from taking unreasonable risks with the lives and safety of their customers and workers. For those scofflaw companies who decide to keep the public in the dark anyway, the bill would provide a critical avenue for obtaining some measure of justice for those who harmed or killed as a result of those companies’ failure to warn.

We urge that you make it a top priority to enact legislation that would address the ongoing crisis of corporations failing to disclose to the public the dangers associated with their business activities, and in particular consider Senator Blumenthal’s Hide No Harm Act. At your request, we are happy to provide you with more information about this problem and to suggest additional ideas for solving it. We thank you for taking these views under consideration.

Sincerely,

Robert L. Glicksman
J.B.and Maurice C. Shapiro Professor of Environmental Law
The George Washington University Law School *

Lisa Heinzerling
Justice William J. Brennan, Jr., Professor of Law
Georgetown University Law Center *

Thomas O. McGarity
Joe R. and Teresa Lozano Long Endowed Chair in Administrative Law
University of Texas School of Law *

Sidney A. Shapiro
University Chair in Law
Wake Forest University *

Rena Steinzor
Professor of Law
University of Maryland Francis King Carey School of Law *

* University affiliations are for identification purposes only