by Russell Mokhiber
Multinational Monitor magazine, September 1998
Calling Unocal "a dangerous scofflaw, corporation,"
a coalition of 30 citizens' groups in September petitioned the
Attorney General of California to begin charter revocation proceedings
against Union Oil Company of California (Unocal).
The 127-page petition argues that Unocal has engaged in corporate
lawbreaking, was responsible for the 1969 oil blowout in the Santa
Barbara Channel and numerous other acts of pollution, committed
hundreds of occupational safety and health violations, treated
workers unfairly, is complicit in human rights violations in Afghanistan
and Burma and has "usurped political power."
Claiming that the state of California routinely puts out of
business hundreds of unruly accountants, lawyers and doctors every
year, the coalition called upon California Attorney General Dan
Lungren to begin a legal process that would result in the revocation
of Unocal's charter.
"We're letting the people of California in on a well-kept
secret," says Loyola Law School Professor Robert Benson,
who drafted the petition. "The people mistakenly assume that
we have to try to control these giant corporate repeat offenders
one toxic spill at a time, one layoff at a time, one human rights
violation at a time. But the law has always allowed the attorney
general to go to court to simply dissolve a corporation for wrongdoing
and sell its assets to others who will operate in the public interest."
If this authority exists, why is it that only once this century-in
1976 when a conservative Republican attorney general asked a court
to dissolve a private water company for allegedly delivering impure
water to its customers-has the attorney general sought to revoke
a corporate charter in California?
"California attorneys general haven't often done it because
they've become soft on corporate crime," Benson says. "Baseball
players and convicted individuals in California get only three
strikes. Why should big corporations get endless strikes?"
Benson argues that a single act of unlawfulness is enough
to trigger charter revocation proceedings, although he admits
that if an attorney general acts against a major company, it will
be for a pattern of wrongdoing, not for an isolated act of wrongdoing.
Unocal's Barry Lane says that if it is true that one bad act
can trigger revocation, then "any company that has ever been
found guilty of anything," would face charter revocation
proceedings and "the attorney general would be running every
company in the state."
So, which is Unocal-a sometimes criminal, or a corporate recidivist?
"We have committed misdemeanors in the past," Lane
admits, "but then so have many companies. We have operated
here for 100 years. Yes we have made some mistakes, but we have
always taken responsibility for those mistakes and worked to correct
The petition alleges more than a single mistake. It lists
10 counts against the company, including:
* Environmental devastation. "The company's environmental
devastation extends from local to global and is serious enough
to describe as ecocide," the petition alleges, focusing especially
on the company's pollution in California.
* Unfair and unethical treatment of workers. The petition
points to the company's conscious strategy of selling off U.S.
operations and discarding U.S. jobs, in order to focus on overseas
* Complicity in crimes against humanity: aiding oppression
of women. The petition alleges that Unocal has negotiated with
and offered vocal support to the Taliban in Afghanistan-though
it suspended negotiations following the U.S. bombing of alleged
"terrorist camps" in Afghanistan in August. The Taliban
have imposed the most extensive regime of gender apartheid known
to the world, the petition points out. Unocal says, "we have
neither signed nor negotiated any business deals with any faction
* Complicity in crimes against humanity: aiding oppression
of homosexuals. In addition to discrimination against women, the
Taliban have a policy of putting homosexuals to death.
* Complicity in crimes against humanity: enslavement and forced
labor. Unocal is building a gas pipeline in Burma, in business
partnership with Burma's SLORC dictatorship. The government has
allegedly used forced laborers to prepare fields and build infrastructure
to facilitate pipeline construction. Unocal denies that any forced
labor has been used in connection with the pipeline project, and
argues that a policy of "constructive engagement" offers
the best hope for democratizing Burma.
* Complicity in crimes against humanity: forced relocation
of Burmese villages and villagers. The Burmese government has
allegedly carried out mass, forced relocations without compensation
as part of the oil and gas project.
* Complicity in crimes against humanity: killings, torture
and rape. The petition alleges that Unocal is liable for human
rights violations by "its military and business partner [in
Burma] under traditional common-law doctrines of conspiracy and
agency, and under international law doctrines of joint participation
and individual responsibility for crimes against humanity."
* Complicity in gradual cultural genocide of tribal and indigenous
peoples. The petition alleges that Unocal operations in the area
inhabited by the Lubicon Cree in Alberta, Canada are contributing
to cultural genocide. Unocal alleges it is "caught in the
middle" in a dispute between the Lubicon Cree and the Canadian
At the time of filing the petition, the coalition acknowledged
its chances of success-especially with a right-wing attorney general-were
slim, at best.
"We are not politically naive," Benson says. "We
don't think that this is going to get so far along the road that
Unocal will actually be broken up anytime soon, although it should
be. Much more likely, we think the attorney general will deny
the petition, and then we will use this as a tool to put pressure
on the political process."
If an attorney general were independent enough to file such
a petition, a judge could appoint a receiver, so that the assets
do not flee the jurisdiction. Then if the judge was inclined to
strip the company of its charter, he or she would have the authority
to make "such orders and decrees and issue such injunctions
in the case as justice and equity require."
The petition requests that the attorney general begin proceedings
to dissolve Unocal and to appoint a receiver and preserve company
assets pending dissolution. The petition also asks the attorney
general to ask a court to use its powers in winding up the company
"'to make such orders and decrees and issue such injunctions
in the case as justice and equity require,' in order to fully
protect jobs, workers, stockholders, unions, communities, the
environment, suppliers, customers, governmental entities and the
Benson says that, if he were the judge, he would transform
the company into a renewable energy company, which would create
more jobs and inflict less damage to the environment.
Ronnie Dugger, founder of the Alliance for Democracy, one
of the groups that signed the petition, calls the filing "an
"It is the first broad-based effort of this century to
use the people's sovereign authority over a corporation chartered
by one of our states to terminate its privilege to do business,"
Dugger says. "It is a step toward regaining actual democratic
control over these giant corporations we've created."
A spokesperson for Lungren's office said at the time of filing
that the office had yet to receive the petition and it would take
"weeks" for lawyers to study it and respond.
That turned out not to be true. Lungren took less than a week
to reject the petition.
In a terse three-sentence letter to Benson, Lungren says simply
that "we decline to institute legal proceedings at this time."
There was no explanation for the decision.
In the letter of refusal, Lungren suggests the petitioners
might ask for permission to bring the suit themselves as a sort
of private attorney general.
"That's proof they didn't even read the petition,"
Benson says. "We rejected that avenue in advance. It is legally
inappropriate because our clients are not seeking a remedy of
private harms unique to them but of harms to the public at large.
In such a case it is the attorney general's statutory duty to
protect that interest in court, not ours. More importantly, only
the full resources of the state will be adequate to challenge
a corporation of Unocal's wealth and size and Attorney General
Lungren knows that. The Attorney General's suggestion that we
take on Unocal ourselves is like urging us to enter a lion's den
armed only with sticks."
Benson says he would consult with the 30 petitioners on the
option of seeking a court order compelling the attorney general
Benson says that Lungren's action was unprecedented. In similar
situations under the statute, the attorney general has always
presented a detailed legal analysis of his reasons for declining
to take action.
"Instead, we got a three sentence rejection that a court
can clearly reverse as arbitrary and capricious," Benson
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