Corporate Litigation

In certain circumstances, a corporation may become criminally liable for offenses committed by its employees, officers, and directors to further the corporation’s interests. Individuals who work for or manage a corporation may face personal criminal liability for crimes they commit or assist with while working for their employer or overseeing the corporation’s activities. However, certain crimes committed on behalf of a business may also lead to criminal prosecution of the business, in addition to civil litigation that the company may face.

When management or employees allegedly engage in criminal acts to further its business, a corporation may need experienced criminal defense lawyers to understand its potential liability and legal options for defending against charges. Contact NachtLaw, P.C. today for an initial case evaluation with a criminal defense attorney. From our main office in Birmingham, Michigan, we help clients in Michigan, New York, Ohio, and Florida to learn more about the liability your business may face for alleged misconduct and to discuss how our law firm can help you defend your financial interests and professional reputation.

Common Types of Conduct That Lead to Corporate Criminal Liability

Various forms of misconduct by corporate employees, officers, and directors may result in civil litigation against the business, brought by parties such as the corporation’s shareholders or other individuals or companies that incurred financial losses as a result. However, actions by employees, officers, and directors of a corporation can also result in criminal prosecution for those individuals. The corporation can also face criminal liability when workers or management commit criminal acts to further the company’s interests. Examples of criminal misconduct that might lead to corporate criminal liability in Michigan, New York, Ohio, and Florida include:

• Criminal Fraud – Corporations may face criminal charges for various types of fraud prohibited by state and federal criminal law, such as healthcare fraud (defrauding Medicare/Medicaid programs), mortgage fraud, or insurance fraud.
• Bribery – A company may engage in the practice of offering bribes to public officials to secure legal benefits for the business, such as awards of public contracts or regulatory approvals.
• Insider Trading – Insider trading involves buying or selling securities based on non-public information about a business.
• Securities Fraud – Other forms of securities fraud may include intentionally providing false information or withholding material information from the public to secure investment or manipulate stock prices.
• Tax Evasion – A corporation could face criminal charges for intentionally reporting false information on tax returns to reduce the business’s tax liabilities or obtain tax credits for which the company did not qualify.
• Racketeering – Companies may face charges under state or federal RICO acts for engaging in multiple illegal acts for financial benefit.

Penalties in Corporate Criminal Cases

Whereas individuals may face criminal penalties that include incarceration, probation, and fines, the government cannot put a corporation in prison. Instead, corporations typically face financial penalties when found criminally liable in prosecutions. Common penalties in corporate criminal cases include:

• • • Fines, often at higher amounts than individuals might face for the same criminal conduct
    • Restitution, which requires a corporation to compensate the victims of its crimes for the financial losses they incurred
    • Forfeiture of profits, property, or other assets gained through criminal conduct
    • Loss of government-issued licenses
    • Disqualification from serving as a government contractor

Who Can Face Liability for Corporate Offenses?

Many criminal statutes refer to the perpetrator of a crime as a “person.” In law, the term “person” has a broader meaning beyond human beings, and can include corporations, companies, partnerships, and business associations. Thus, when a Michigan, New York, Ohio, or Florida business’s owners, managers, and employees commit criminal acts in furtherance of the company’s interests, the company can face criminal liability alongside the individuals who committed the acts.

A company may bear criminal liability for employee, officer, or agent misconduct, even if it warned employees against committing the specific misconduct in which they ultimately engaged. However, prosecutors may consider a corporation’s comprehensive, good-faith compliance program when deciding whether to hold the company criminally liable for an employee’s or officer’s misconduct.

What Do Prosecutors Look for When Considering Criminal Charges Against Corporations?

When state or federal prosecutors consider bringing criminal charges against a business for the acts of those working on behalf of the company, they will examine a case to see if it meets specific criteria, including:

• • • Whether an officer, employee, or agent of the company committed the criminal act
    • Whether the individual committed the act within the scope of their employment
    • Whether the act, in part or in whole, benefited the company

Prosecutors may investigate whether an employee or officer of a corporation committed a crime with the intent to benefit their company. Furthermore, a single employee or officer need not have sufficient intent. Instead, the aggregate intent of multiple employees, officers, or agents whose collective acts committed the criminal offense may support the prosecution of their corporation.

Because prosecutors have discretion over whether to file criminal charges, they will consider various factors in deciding to prosecute a corporation for a crime, including:

• • • The pervasiveness of wrongdoing in the corporation
    • The corporation’s history of misconduct
    • The existence and effectiveness of compliance programs within the corporation
    • The timeliness and voluntariness of the corporation’s disclosure of wrongdoing
    • The corporation’s cooperation with investigators
    • The lack of any effort by the corporation to obstruct an investigation

Understanding the Differences Between Criminal Prosecution and Corporate Litigation

Corporate wrongdoing can lead to both criminal prosecution and civil litigation. However, criminal prosecution and civil lawsuits serve different objectives and follow different procedures. Criminal prosecution seeks to hold a person or company responsible for committing crimes against society, with the purposes of prosecution and conviction including punishing a criminal offender for their conduct. Conversely, corporate litigation seeks to hold companies responsible for financial losses suffered by specific individuals or businesses or to provide those individuals and businesses with other relief from the company’s misconduct.

When a business faces criminal prosecution, it receives some (but not all) of the rights that an individual charged with a crime enjoys, such as the right to a trial by jury, the right to confront evidence and witnesses brought against it, and protection against warrantless searches occurring in the context of a criminal investigation. Companies also have the right to retain defense attorneys to represent them at trial.

Why Choose NachtLaw, P.C.?

When your company in Michigan, New York, Ohio, or Florida faces allegations of misconduct, those accusations can lead to both corporate litigation and criminal prosecution. Your business needs a dedicated attorney to navigate criminal matters. Turn to a lawyer from NachtLaw, P.C. to advocate for your rights and interests because:

• • • When your business contacts us for help facing criminal and civil liability for alleged misconduct, you will always work directly with our attorneys, rather than going through a paralegal or assistant.
    • Our lawyers offer honest, straightforward advice to help you understand your corporation’s legal options. Our firm will never look for a quick end to your case. Instead, we put in the time and effort necessary to help your business achieve the best possible resolution under the facts and circumstances of your case.
    • You can trust our attorneys to stand up for your company’s rights and interests while under investigation for misconduct. Our law firm will pursue every option to secure a favorable outcome that protects the business’s finances and reputation.

Contact Us Today for Your Corporate Litigation Needs

Contact the law office of NachtLaw, P.C. for a confidential consultation with a knowledgeable criminal defense lawyer serving Michigan, New York, Ohio, and Florida to learn more about how allegations of misconduct against a corporation can lead to civil litigation and criminal prosecution for the business and its leaders. Let’s discuss how an experienced lawyer from our firm can help you navigate criminal investigations or proceedings that your company may face.