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Ruminations 83(4) (On Information, Markets, Labor, and Politics): Looking Back on 2018 in Epigrams and Aphorisms

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(Pix © Larry Catá Backer 2018)

The year 2018 is ending with the great rifts opened in 2016, and exposed in 2017, now acquiring a greater urgency and show and revealing the power of its consequences. Global divisions have become more acute, even as these reflect in turn the even more acute rifts within both great and small global actors--states, societies, religions, civil society, and enterprises.

2018 is rich with rift events.  This was the year of America First and the Belt and Road Initiative.  It was the year of great rifts among allies--especially the great family of post World War II Anglo-European allies--and of growing compatibility among rivals. This was the year of the exposure corruption--in  which  Latin American corruption brought down the government of Perú and the President of Brazil. Corruption swirled around the highest levels of the United States and of China. It was the year of great social transformation spurred by revelations--of sexual improprieties, and of policing and race in the United States. It was a year in which the U.S. President continued to serve as lightening rod  and the international order was upended. But it was also a year in which Brexit appeared to invite failure. But all of this seemed like a build up to resolutions that lie beyond 2018.  In the end, 2018 might be understood as a year of stage setting  

With no objective in particular, this post and a number that follow provides my summary of the slice of 2018 to which I paid attention through epigrams and aphorisms. It follows an end of year  tradition I started in 2016 (for those see here) and 2017 (for these see here).  

This is Part 4 (On Information, Markets, Labor, and Politics). Share your own!

Ruminations 83: 2018 in Epigrams and Aphorisms
Part I (On education and knowledge).
Part 2 (On Systems).
Part 3 (On the Things that Divide and Join Us).
Part 4 (On Information, Markets, Labor, and Politics)
Part 5 (On the Games Peoples Play)





1. Information has acquired a triple character in the contemporary age; it is the foundational means for structuring efficient and legitimate markets; it is a commodity  around which production is organized; and it is the fundamental object of institutional (political) power
[("From subway trains and wind turbines to toilet seats and toasters—all sorts of devices are becoming sources of data. The world will bristle with connected sensors, so that people will leave a digital trail wherever they go, even if they are not connected to the internet. As Paul Sonderegger, a big-data strategist at Oracle, a software-maker, puts it: “Data will be the ultimate externality: we will generate them whatever we do.”")Data is giving rise to a new economy]




2. If the foundation of the current era is information, then its fundamental contradiction is transparency, the paradoxes of which define the dynamic element of markets, institutions (including the state), and production .
[("But Google is not a consumer software company, or even a search company. It’s an ad company. It collects exhaustive data about its users in the service of brokering ad sales around the web. To do so, Google requires an extensive understanding of the backgrounds, browsing habits, preferences, purchases, and lives of as many web users as possible, gleaned through massive data aggregation and analysis.") The Privacy Battle to Save Google From Itself; ("Another way to put this is to say that information, data and the unbounded flow of more and more speech can be politicized — it can, that is, be woven into a narrative that constricts rather than expands the area of free, rational choice. When that happens — and it will happen often — transparency and the unbounded flow of speech become instruments in the production of the very inequalities (economic, political, educational) that the gospel of openness promises to remove."‘Transparency’ Is the Mother of Fake News)



3.  Privacy is the name given to mechanisms for withholding clusters of rules a contingent privilege; it merely suggests that individuals and entities withhold data from others unless it is needed; but this is neither privilege nor right, just a stricture for managing information flows and their use. . 
[("The increasing gap between the ability of law enforcement to lawfully access data and their ability to acquire and use the content of that data is a pressing international concern that requires urgent, sustained attention and informed discussion on the complexity of the issues and interests at stake.")Statement of Principles on Access to Evidence and Encryption]
4. The contradiction of information in markets is between an identity among generation and consumption (all actors generate and consume without impediment), and information symmetries between producers and consumers, grounded in power and supported by law
[("The data-driven system would help meet market objectives by effectively extending financing options to the country’s large unbanked population, and ideological objectives by addressing rampant corruption, profiteering, and mistrust in the country—or as early documents promised, to “allow the trustworthy to roam everywhere under heaven while making it hard for the discredited to take a single step.”") China's Great Social Credit Leap Forward; ("Today, social credit is once again a reality. Everything from the information that we are shown to the prices and opportunities we’re offered are wrapped up in the byzantine way the digital world curates identity. We have easy access to our credit scores, and know the way to improve them. When it comes to the online world, this isn’t nearly so straightforward. Who is gathering data about us, how is it used and what does this mean for the way that we perceive the digital world around us; all of these questions are far from clear.") We’re closer to China’s disturbing ‘Social Credit System’ than you realize; Next Generation Law: Data Driven Governance and Accountability Based Regulatory Systems in the West, and Social Credit Regimes in China]


5. As markets and governance merge, the contradictions of information grow.
[("The UN Myanmar investigator Yanghee Lee said Facebook was a huge part of public, civil and private life, and the government used it to disseminate information to the public. “Everything is done through Facebook in Myanmar,” she told reporters, adding that Facebook had helped the impoverished country but had also been used to spread hate speech. “It was used to convey public messages but we know that the ultra-nationalist Buddhists have their own Facebooks and are really inciting a lot of violence and a lot of hatred against the Rohingya or other ethnic minorities,” she said.") Myanmar: UN blames Facebook for spreading hatred of Rohingya]

 
6. Information without analytics is a valuable tool for markets, but less for the state.   
[("Sri Lanka had high literacy rates but poor information literacy, he added, making the problem more acute. “It means the population can read and write but tends to immediately believe and uncritically respond to that which they see on social media,” he said.") Sri Lanka accuses Facebook over hate speech after deadly riots; ("Indian authorities are scrambling to combat a spate of murders linked to rumours circulating on messaging application WhatsApp. Eight people have been killed across the country in the past few days, after rumours spread on the app about child kidnappers on the loose and a video was circulated that purported to show a boy being snatched.")'WhatsApp murders': India struggles to combat crimes linked to messaging service].

7.  This triple character of information is shared with individuals, who are a commodity around which production is organized; who are the objects of institutional (political) power; and who play an essential role in the efficiency and legitimacy of markets (though consumption and investment).
[("Platforms can be designed to favor one side of the market over the other. Specifically, labor markets may be set up to favor employers at the expense of workers, since employers are harder to find than workers in most cases. This is a result of an array of small, seemingly inconsequential design decisions that together make it too hard for workers to find jobs they really want to do, so they settle for the job they can easily find.") Online labor markets may look competitive. They aren’t]

8. The identity between individuals and information is the fundamental ordering principle of the emerging global order.
[("What has changed? Smartphones and the internet have made data abundant, ubiquitous and far more valuable. Whether you are going for a run, watching TV or even just sitting in traffic, virtually every activity creates a digital trace—more raw material for the data distilleries.")The world’s most valuable resource is no longer oil, but data



9. Individuals and information become fungible, in the sense that individuals can be understood as the sum of a stream of information generation, and information generation can itself constitute the individual from which it is produced as well as its environment.
[("Commodification forms are exemplified by the economic policies of Cuba and N. Korea.  Both states see in their workers a commodity that can be leased to others. . . . Abstraction forms are exemplified by the encouragement of labor migration targeted to certain areas for the purpose of generating remittances home. The export of domestic labor abroad, then, serves to generate wealth at home  through the expectation that such exported labor will send home whatever cash they can. The individual laborer, then, is transformed to an income stream, the present value of which serves as an important element in macro-economic policy. ") The Commodification of Labor and the Price of Labor Wage Remittances: Venkatesh Nayak on "RTI reveal: More than 10 Indian workers died every day in Gulf countries in the last six years; 117 deaths for every US$ 117 remitted"]

10. The feedback loop between people and information, between generator and consumer, between essence and activity, serves as the foundation for the contradiction of markets, production and power; to manage individuals one need only access their information, to manage information one need only have access the individual.
[("Facebook gave Netflix, Spotify and the Royal Bank of Canada the ability to read, write and delete users’ private messages; it gave Microsoft, Sony and Amazon the ability to obtain email addresses of their users’ friends as late as 2017; and it gave device manufacturers such as Apple the ability to build special features that plugged into the social network. The New York Times investigation revealed that it had itself been one of the companies granted access to some of the Facebook user data.") Facebook shared private user messages with Netflix and Spotify


11. Information, like people, have to be carefully husbanded--by markets, by institutions, and in production--to maintain a balance between consumption and generation; but the contradiction--balance is impossible between production and generation of individuals or information where markets, systems, or production consume and generate information to different ends.    
[(American social credit regimes grounded on private sector driven robust markets for data; "The purported multi-million dollar agreement allows the Californian search company to link the purchases of Mastercard customers to their email addresses.These addresses are used to identify customers' online activity – and track the adverts they have seen on webpages and inside mobile apps.Google uses this information to determine whether the adverts successfully influenced their shopping habits in the real-world.") Google 'paid millions to Mastercard to track credit card spending' to find out whether people are being successfully influenced by its online adverts]

12. A people, a political or social community, is now only the sum of its DNA; one is nothing more than the sum of information located within collectively organized genetic codes deployed fopr the greater glory of the state, or at least its articulated interest.
[("“Un 70 % de la información genética proviene de ancestros europeos, alrededor de un 20 % por ciento proviene de esclavos africanos que fueron traídos a Cuba, o sea de nuestros ancestros africanos, un 8 % —lo cual no es subestimable— viene de nuestros aborígenes, de nuestros primeros habitantes de la Isla, y cerca de un 2 % por ciento de los chinos, de los asiáticos que fueron traídos a Cuba ya fundamentalmente en el siglo XIX… Todos los cubanos sin lugar a dudas somos mestizos independientemente del color de la piel que tengamos o que se visibiliza”. Son declaraciones de la Dra. C. Beatriz Marcheco Teruelo, directora del Centro de Genética Médica, institución fundada por iniciativa del Comandante en Jefe Fidel Castro Ruz y que acaba de cumplir el pasado 5 de agosto sus primeros 15 años de vida.")¿De dónde venimos los cubanos según estudios de ADN? [""70% of the genetic information comes from European ancestry, around 20% percent comes from African slaves that were brought to Cuba, that is from our African ancestors, 8% - which is not underestimated - comes from ouraborigines, of our first inhabitants of the Island, and about 2% of the Chinese, of the Asians who were brought to Cuba and mainly in the nineteenth century ... All Cubans without a doubt are mestizos regardless of the color ofthe skin that we have or that becomes visible ".These are statements by Dr. C. Beatriz Marcheco Teruelo, director of the Center for Medical Genetics, an institution founded on the initiative of Commander in Chief Fidel Castro Ruz and which has just celebrated its 15th anniversary on August 5."]; "The Cuban nation constitutes its own indigenous people. The problem of the Indian or other native peoples are those of other states. There is an irony here. For it appears that only states unsuccessful in obliterating their native peoples—in fact or effectively—are to be subject to its strictures. Even Mexico appeared to seek refuge within a more complex version of this stance. The uses of this stance of indigenous nation without Indians is used to good effect in the many programs devised by Cuba in opposition to the interests of the United States."From Hatuey to Che: Indigenous Cuba Without Indians and the U.N. Declaration on the Rights of Indigenous Peoples


13.  Everyone makes lists; most put the to use--basic data driven decision making.
[("‘ White House Press Secretary Sarah Huckabee Sanders announced the stunning move from the White House briefing room podium as the building was engulfed in controversy over the new tell-all book penned by former aide Omarosa Manigault-Newman. . . . . John Brennan is a stain on the Country, we deserve better than this,' Bongino said. Trump told him, 'Thank you Dan, and good luck with the book!' Sanders was the face of the clearance dispute on Wednesday after making the announcement about Brennan at a briefing where she withstood repeated questioning about why each of the officials targeted for review has been a prominent Trump critic or otherwise features in Special Counsel Robert Mueller's Russia probe.. . . . "I know some things that the Russians were involved in, but I certainly don’t know all the things that Mr. Trump has been involved in over the years, and I do not pretend to have that knowledge,’ he continued. ‘He is the one, but clearly his actions are those of somebody who is seeking to prevent the full light of day being shown upon his past,’ Brennan said, clearly linking the decision on his clearance to Mueller’s probe.") 'Trying to silence me is a pointless abuse of power:' John Brennan condemns Trump for stripping him of security clearance and calling him 'frenzied'– as attempt to muzzle critics appears timed to distract from Omarosa debacle]

Ruminations 83(5) (On the Games Peoples Play): Looking Back on 2018 in Epigrams and Aphorisms

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(Pix © Larry Catá Backer 2018)

The year 2018 is ending with the great rifts opened in 2016, and exposed in 2017, now acquiring a greater urgency and show and revealing the power of its consequences. Global divisions have become more acute, even as these reflect in turn the even more acute rifts within both great and small global actors--states, societies, religions, civil society, and enterprises.

2018 is rich with rift events.  This was the year of America First and the Belt and Road Initiative.  It was the year of great rifts among allies--especially the great family of post World War II Anglo-European allies--and of growing compatibility among rivals. This was the year of the exposure corruption--in  which  Latin American corruption brought down the government of Perú and the President of Brazil. Corruption swirled around the highest levels of the United States and of China. It was the year of great social transformation spurred by revelations--of sexual improprieties, and of policing and race in the United States. It was a year in which the U.S. President continued to serve as lightening rod  and the international order was upended. But it was also a year in which Brexit appeared to invite failure. But all of this seemed like a build up to resolutions that lie beyond 2018.  In the end, 2018 might be understood as a year of stage setting  

With no objective in particular, this post and a number that follow provides my summary of the slice of 2018 to which I paid attention through epigrams and aphorisms. It follows an end of year  tradition I started in 2016 (for those see here) and 2017 (for these see here).  

This is Part 5 (On the Games Peoples Play). Share your own!

Ruminations 83: 2018 in Epigrams and Aphorisms
Part I (On education and knowledge).
Part 2 (On Systems).
Part 3 (On the Things that Divide and Join Us).
Part 4 (Markets and Politics)
Part 5 (On the Games Peoples Play)




1. Meetings of people who do not mean what they say exactly is farce; meetings of people who never say what they mean with people who think they mean what they say is tragedy.
[("The sparks appeared to begin to fly after Pelosi characterized the possibility of a shutdown as a "Trump shutdown."According to an aide in the room, Pelosi said she was "trying to be the mom" in the meeting with Trump.  "You can’t let him take you down that path," Pelosi said, according to an aide in the room. "But the fact is we did get him to say, to fully own that the shutdown was his." . . . In the statement, Sanders called the meeting a "constructive dialogue." She said the President was "grateful for the opportunity to let the press" into the meeting."Major disagreement remains on the issue of border security and transparency," the readout read.") Trump spars with Schumer and Pelosi in Oval Office meeting; Transcript of the heated meeting between Trump, Pelosi and Schumer]

2.  Constitution making should not be left solely to the elites; invariably, however, elites develop a sort of proprietary relationship with such projects, even as they desperately seek to encourage and manage popular participation.
[(The leaders of the Cuban State, like many other leading groups around the world in comparable circumstances, have announced its commitment to encourage popular review and commentary of its project of constitutional revision for the Cuban Republic. Such review and commentary is to be broadly encouraged not just from Cubans living within Cuba but also those resident abroad. It is with that in mind that I will make available popular commentary submitted to the state organs or otherwise published during the course of the public commentary around the debates in Cuba (and elsewhere among Cubans abroad) to the 2018 draft Constitution.) Recursos del constitucionalismo cubano/Cuban Constitutionalism Resources: Primeros Commentarios del Pueblo/Initial Popular Commentaries; CubaConstitution 

 (Pix Credit HERE (Photos of the Paris “Yellow Vest” Riots)

3.   Radical engagement from the underbelly of the political order is rarely taken for what it is.
[("Youths torched and vandalized scores of cars in the Swedish city of Gothenburg and surrounding towns and Prime Minister Stefan Lofven said on Tuesday the disturbances looked organized “almost like a military operation. . .  It was unclear what triggered Monday night’s unrest but Sweden has seen a rise in violence in areas with high unemployment and other social problems and the incident echoed rioting in the capital Stockholm in 2013”)  Youths in Swedish towns burn and vandalize scores of cars; ()

4.  If everything is white privilege, then at last the color element of hierarchy is again put in its place;and again color is eviscerated form analysis
[("It remains that the key difference between the French Guiana protesters of 2017 and their metropolitan counterparts of 2018 is of course one of status. For most of its history, French Guiana was a distant colony, whose indigenous population was cobbled together from Amazonian tribes, marooned slaves and convicts. On the other hand, historians will note that since the French Revolution, rural France has been the backbone of the République — always rebellious but also fiercely republican and egalitarian. That France does not take lightly to be administered like a distant colony by the government. Some might even call that republican, if not white, privilege.") To understand the Paris ‘yellow vests’ riots, look to French Guiana]



5.  There are other states which serve as a dress rehearsal for the American conversation about citizenship and residence; but it appears only the American conversation has significance.
[("India has effectively stripped four million people in Assam of citizenship, sparking fears of mass deportations of Muslims from the northeastern state. But authorities assured that those who could not make it to the draft list will not face "immediate deportation or be arrested". People will be given time to file for corrections, Indian officials said. . . . The right-wing Bharatiya Janata Party (BJP) of Prime Minister Narendra Modi came to power on the promise to expel the so-called "illegal foreigners" and protect the rights of indigenous groups.") What's next for the 4 million stripped of citizenship in India?].

6.  Society has again sought to construct its gods in its own image; but it remains to be seen whether they will be able to control their gods this time around.
[("In a sense, a curious transformation emerges from the efforts to use law and conventional administrative regulation as a means of constraining and shaping AI, and AI related systems of management. Law, in this context, becomes much more remote--it is transformed from a first to as second order regulatory device.  That is, law becomes most useful (and the administrative regulations through which it is amplified and made enforceable) as a means of constructing operational systems, rather than as the basis for the set of direct command that its objects must obey.  Law increasingly is best used to constitute systems rather than to serve as the means for operationalizing systems once constituted through meta-legal documents (constitutions, etc.).") Eckpunkte der Bundesregierung für eine Strategie Künstliche Intelligenz/Key points of the Federal Government for an Artificial Intelligence strategy As of 18 July 2018]

7. Territoriality based regionalism is an artifact of the 20th century; but there is much that connects states caught between global giants and their new era initiatives; thus is born new era economic regionalism. 
[("The other countries in the deal were undeterred by the US’s withdrawal. Even without the US, the new pact will be among the largest multilateral trade deals ever enacted . The CPTPP countries include 14% of world GDP. Beyond just lowering trade barriers between the countries, the deal also includes greater protection of intellectual property rights—a part of the deal the US fought for—and provisions to increase minimum labor standards for workers in participating countries") The huge new Pacific trade deal has gone into effect without the US]
 8.  Statues are at their most influential at the time they are erected and at the time they are torn down or removed; it is only at those moments that they serve as the hand puppets of others.
[("The removal of Mr. Nagy’s statue is part of a broader push by Mr. Orban to resurrect Hungary’s right-wing authoritarian past, said Peter Kreko, director of Political Capital, a Budapest-based political think tank and consultancy. “It’s the re-establishment of the symbolic politics of the Horthy era,” Mr. Kreko said, adding that the restoration of public areas around Parliament to reflect their appearance between the two world wars was a sign that the country’s political leadership was seeking to build on Admiral Horthy’s heritage.") Hungarians Fume as Statue of Former Leader Is Downgraded]


9. The 20th century was one in which the world renounced "unequal treaties" and imperialism; the 21st Century will have to confront the meaning of equality within global production chains.
[("And then the port became China’s. Mr. Rajapaksa was voted out of office in 2015, but Sri Lanka’s new government struggled to make payments on the debt he had taken on. Under heavy pressure and after months of negotiations with the Chinese, the government handed over the port and 15,000 acres of land around it for 99 years in December.")How China Got Sri Lanka to Cough Up a Port].
10.  Even states have learned to make the masses laugh despite themselveswhen they substitute agit-prop for politics.
[("Bravo. One has here at least a marvelous piece of agit prop that serves the interests of all of those invested in it. But does it do anything else? For that we must wait and see. But what is clear is that even the most compelling bit of agit prop can be turned on itself. Visual agitprop is an invitation to engage with image the way one used to engage with words. In both cases ideas may be produced. But the marvelous image that the Germans produced can take on a life of its own from the moment it is liberated. In this case, some of these interpretations may actually do the Germans more harm than good--not with one's allies, but precisely with those who need to be influenced. ") Picture and Communique: Agit Prop at the G7]


  

The Orishas Speak: The 2019 Letter of the Yoruba Association of Cuba (Letra del Año para el 2019 de la Asociación Yoruba de Cuba) (Refran: "Las raíces de IFA son amargas y el fruto es dulce")

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(Pix CiberCuba Jan 1, 2019)


Every religion connects the structures of divinity to the human communities around which their worship is structured and social, political, economic, and cultural communities are organized. To that end, the priestly caste platys a very specific role as mediator, interpreter, and as the incarnation of a social order grounded in divine principles and rules.
In most states, the priestly role has been transformed.  But it is useful, as one examines the priestly role in modern western states, to consider a more traditional relationship between the priest and the state.  One of the more interesting manifestations of the role of religion within political life is that of the priests of the practitioners of the old religions of Africa as re-established in the Western Hemisphere, particularly in Marxist-Leninist Cuba.  (here)
That priestly role is exercised in very specific ways among the great traditions of Western Religions: Judaism, Christianity, and Islam.  It shows a more variegated vigor among Non-Western religious traditions.  These are well known.  Yet most of these have sought to marginalize the great traditions of African religions as a barbaric variant of primitive idol worship that had been suppressed elsewhere.  And yet those religious traditions remain as vibrant, their theologies as complex, and their practices as rich as those other religious traditions that have sought over many centuries to supplant them.  And so it was in the early hours of the 1st of January that leaders of the various branches of the Afro Cuban religious communities met. 
Babalawos de diferentes ramas religiosas de Cuba han vuelto a reunirse liderados por la Sociedad Cultural Yoruba y el Consejo de Sacerdotes Mayores de Ifá, para dar a conocer sus predicciones para el año que empieza este martes 1 de enero: la Letra del año 2019. La ceremonia comenzó este 31 de diciembre y se ha extendido hasta este 1 de enero. Del Oráculo de Ifá salen las siguientes recomendaciones y advertencias que deberían seguirse a lo largo de este año para conseguir salvar todos los obstáculos. [Babalawos of different religious branches of Cuba have returned to meet led by the Yoruba Cultural Society and the Council of Major Priests of Ifá, to present their predictions for the year that begins this Tuesday, January 1: the Letter of the year 2019.ceremony began on December 31 and has been extended until January 1.From the Ifa Oracle, the following recommendations and warnings are issued that should be followed throughout this year in order to overcome all obstacles.] (CiberCuba,  Adelanto: Letra del Año 2019 para Cuba)
And so the great priestly caste of the Cuban branch of the great West African Religions have once again come together to seek divine guidance for the nation, and its religious communities, for the year to come.  To that end, at the start of every year the leaders of the great indigenous religion of Cuba conduct, through a series of ceremonies, a general divination for the country.  The results of that divination, and its advice, is organized into a "Letter of the Year" (Letra del Año) (on the history of the Letras del año see HERE (Historia de la Ceremonia de la Letra del Año )).
La Letra del Año comenzó a emitirse en Cuba a finales del siglo XIX, sin poder precisar la fecha exacta. Por datos y documentos se revela que babalawos procedentes de las diferentes ramas religiosas existentes en el país comenzaron a reunirse para efectuar con todo rigor las ceremonias establecidas, que concluían el primero de enero con la apertura de la Letra del Año. (EcuRed, Letra del Año) (The Annual Letter was first produced sometime near the end of the 19th century.  Existing evidence suggests that the Babalawos of the different branches of the faith in the nation started to gather together  to invoke with all rigor the appropriate ceremonies that concluded on the 1st of January) with the opening of the Letter of the Year).

The object of the annual letter is to provide guidance for the nation and its people.  More specifically it is meant to provide guidance for faith practitioners otherwise unable to receive more specific guidance within their own branch. For the last seven years I have written of the annual letter of the Cuban Council of the High Priests of Ifá (Consejo Cubano De Sacerdotes Mayores De Ifá), the practitioners of traditional religion brought over from West Africa with the slave trade and now naturalized as a powerful indigenous religion throughout the Caribbean and now growing in the United States. (e.g., 2018, 2017, 2016, 2015; 2014; 2013; 2012). The 2018 Letter was particularly relevant--it stressed that 2018 was to be the year of great revelaitons that would begin to have transformative effects (more here 2018)

2019 marks the fourth year of an important change, in which many of the most important branches of the faith came together to produce a unified letter. ("El documento, que copiamos íntegramente a continuación, incluye el signo y el orisha regentes, además de la oración profética. El documento se ha elaborado conjuntamente entre la Asociación Yoruba de Cuba y la Comisión Organizadora para la letra del Año Miguel Febles Padrón." (here); more in English HERE).

This year was  different in another way.  For a few hours early on January 1st, there appeared to be two distinct letters distributed on the Internet.  The first appeared to be the full Letra del Año and was posted to two web sites, one from Miami and the other from Madrid, but both with deep connections to the religious community in Cuba.  At the same time the official sites in Cuba posted the more traditional Adelanto de la Letra del Año, de la Sociedad Cultural Yoruba de Cuba (Preliminary Letter).  This one included a quite different set of divination. This one was thereafter reported in the official press in Cuba and the U.S. (e.g., here, here, and here). One of the two websites that had posted the original full letter then switched to the Adelanto version; the other had not as of the afternoon of 1 January (here) along with one other (here), though curiously the later one posted on 31 December 2018. By the end of the day, however, the websites had all eliminated the alternative version and posted the now official version (in full HERE).

I post both versions below. Both are worth considering A copy of the Full version appeared on the Internet towards evening 1 January and also follows below along with the Adelanto.  I follow each with my own brief reflections on the very different key oddus which form the basis of the divination in both official and the "other" version.

 


The divination for 2018 pointed to fairly significant ruptures and also to fairly significant disclosures in the sense that what was hidden will be revealed. The emphasis was on the crossroads--communication, movement, luck, and starts, true or false--and on symbols that has traditionally been gendered female--the sea, the moon, intuition, fecundity, and protectiveness of  family.As ti turned out, 2018 was indeed a year of revelations with significant ruptures; it was a year for revelations of spying, of corruption, and of sexual impropriety.  It was a year in which careers and states were upended by reason of revelation and communication. 

The almost simultaneous distribution of two quite different Letters of the year is quite curious.  More curious still, the timing. And most curious, the contents of both.  The official Letter of the Year  looks to the seduction of industry and war.  The unofficial and likely superseded full version looked to blind justice intensified and contained within the drive toward accumulation. Both are worth considering for their perspectives, and as well for the critical role of divination in influencing the way that communities see the world and choose to operate within it.  

A. The Official Version




Adelanto de la Letra del Año, de la Sociedad Cultural Yoruba de Cuba


Signo Regente: Oshe Ogunda
1er. Testigo: Ika Ogunda
2do Testigo: Osa Kuleya

Oración Profética: Osorbo Iku Intori Ogu.

Orula Onire: Adimu (Un ñame, un coco partido en 2 mitades, todo se embarra con manteca de corojo, su coco y sus velas.

Otan Onishe Ara: Sarayeye con un pollo y se le da a Oggun, con los demás ingredientes y darse un baño con hierbas de Paraldo.

Otan Deidad que Gobierna: Oshún
Deidad Acompañante: Oggun Otan
Bandera: Amarilla con Ribetes verdes

Ebbo: 1 chivo (para Elegba) 5 güiritos, a los cuales se les echan añil, miel, manteca de corojo, palo rompe hueso y sangre el chivo y se cuelgan en la puerta, y los demás ingredientes.



__________


(Pix credit here)


The now official divination for 2019 takes a different turn.  It is founded on two very specific manifestations of the divine--Oshun and Oggun Otan. The first manifests love and accumulation, wealth and the world of the senses.  The second represents industry and weaponry. The patakis for Oshun and Ogun are particularly interesting. And they point to the way that the ruling manifestations of the divine in this reading will strongly affect the approach to the oddus that make up the core of the reading.
When Ogun, the fierce and hard-working blacksmith, withdrew from the creation of the world and retreated into the forest, Oshun brought him out. With the departure of Ogun's force and labor, creation stopped. No new fields were cleared for planting and no new inventions appeared to help the Orishas and human beings. Ogun took to the bush, and the process of creation came grinding to a halt. Several orishas tried to draw him out of the forest but failed. Finally Oshun went into the woods with her five scarves and her gourd of honey. She did not call to Ogun. Instead she found a clearing and began to dance. Her beauty and her sensual movements caught Ogun's attention. As he watched her dance, he was drawn to her. Slowly he approached her, and when he drew close, Oshun smeared his lips with her honey. As she danced, Ogun followed her back to civilization and resumed his work. (Depths of Oshun)
This combination of creation, exile and seduction suggests the context in which the relevant oddus ought to be approached. Ogun is creation, the driving force of accumulation, of the development of productive forces, but also of the development of destructive forces as well.  He is at once connected to the world but also quick to be distressed by the failings of humans, and willing to retreat.  Oshun is the amplification of the seduction of plenty, of love and of connection, in the face of a powerful orisha's intent to withdraw form the world and his communities. She is the manifestation of life forces, of passion. As such, she manifests the amplified irrationality of both the decision to withdraw and the decision to allow oneself to be led back. That s the structure within which it is possible to read the oddus--of the pulsing relations between the development of productive and destructive forces, and of the seduction of passion for its object.  That arc of interaciton describes the animating pattern of events in 2019.

While the full letter will likely include the usually amplification in the context of Cuba and Cuban affairs, I will leave that for later--and others. In any case, those will be based on the way that the driving oddus are encountered by the religious community.  I provide here my own brief observation of the directions to which those point within the ordering context of the Oshun-Ogun connection.

The oddus (reflections based on the translations and oddus in The Sacred Ifá Oracle (Afolabi A. Epega and Philip Neimark, Brooklyn NY: Athelia Henrietta Press, 1995)

1. Signo Regente: (Oshe Ogunda (The Sacred Ifá Oracle no. 2)Ogunda speaks generally of fighting, of conflicts and disputes.  It speaks to the need for sacrifice--that is for action directed to the right place.  It is the essence of Ogun--the tool maker, builder, warrior. One speaks here of industry, of production, and of conflict intimately tied to that production. In contrast Ose speaks to the need for action to ensure long life and health. But it also infers that sacrifice is needed to extend life in the face of enemies that might otherwise shorten it. Ose is sometimes tied to Shango and Orunmila. It is about identifying and overcoming enemies. Taken together Ose Ogunda is a double warning about conflict that can affect not just production but life. These are amplified by the two supporting oddu.But it is not just conflict among strangers; it is a conflict between parents and children, what is coming and what is going.

2. 1er. Testigo: Ika Ogunda (The Sacred Ifá Oracle no. 204). Speaks to the courage to face conflict.  If  Oshe Ogunda portends conflict in the midst of good fortune, then Ika Ogunda speaks to the lack of will to protect oneself.  It signals that the yar will see the mighty fall for failure of a will to fight.  They will flee but not sacrifice.  Expect to see strategic retreats among the mighty throughout the year.  And expect as well that this fearful retreat will be undertaken in the spirit of Ogun leaving the world of humans to live alone in the forest.  In the long term the results will not be propitious. Ika Ogunda speaks of the coward's son who was half dead from fright in the face of conflict. He was advised to sacrifice and did not (A daafún Adetutu, Omo-Ojokof'okan-balemi (eemi), Akúde' dajikijatoode. Won niki ó rú: Ajá kan, emu, esun-isu ati epo. O gbó ko rúbo). The problem did not disappear.  But it is Oshun who drives the oddus for this letter fo the year.  And this is the sort of Oddu that suggests that it will not be the Oshun who danced and enticed Ogun back from the forest that will be intermeshed with the coward's son.  It will likely be the Oshun enraged  by the negation of passion that the cowartd's son suggests.  And that will not bode well for those who seek to avoid conflict thrust upon them.

3. 2do Testigo: Osa Kuleya (or Osa Ogunda, OSA Guleya; The Sacred Ifá Oracle no. 202). Osa Ogunda speaks to the importance of sacrifice in human activity.  that can be understood literally or metaphorically in the sense that the sacrifice must be made by the person but its form and direction are not necessarily always bound by a specific set of ritual expectations. Sacrifice is the quid pro quo of interaction and of movement forward to or away from particular courses of events that otherwise would have followed a particular course.

Ossa Ogunda speaks to the need for action to assure good fortune, that is good fortune requires action and sacrifice. It is an oddu of the ability (and need) to fight (Osa Gubda le ja) and of the effect of sacrifice in that context. It tells of the divinaiton for Olibara.  He sacrified  for good fortune; he sacrifiec for fecundity.  And he was granted both. But when war was divined he refused to sacrifice. He made no effort to thwart or meet war.  War came and he fled, with no fortune or children. Aija-gogorogo awo ilké Olibara, o ni ogun li oun ri, O niki Olibara rúbo; Agbo, egbaa metalelogbon owó. O ni bu Olibara ka ba rúbo, O ni ogun yoo de ni ojo mòkànlá. Olobara ko rúbo. Ojo mókànlá pe, Ogun de. Olibara sa'gun kuro ni ilu.    The sacrifices of fortune and fecundity will bring war--those who chose to do nothing will find all that is theirs taken away.  But it also suggests the imminense of conflict, and the need to prepare.

Osa Ogunda  also speaks to the irony of desire.  It tells the stroy of the weed and the farmer who both sought to avoid death.  Both were told to sacrifice. The weed was told that it would not die but would be placed in a higher place.  The farner was told he would avoid death.  With that the farner finished howing the furrows of his field and gathered up the weed with his tools, which he then placed high on a stump.  The weed only saw that it had been made notable.   "Therefore the last words usually spoken by the weed are: 'May the farmer not die. May I too not die, so that we both remain forever'" (Emi joyè orí aga o, nitorinaa, oro ikehin ti Aikujegunre nso niipe: Ki Oloko ma kú o, ki emi ma kú, ki a njo fi aiko j'egbo s'ara).  Rioots do not die, and the farmner lives on what he harvests; a reating cycle of life.

In both aspects, it is action and inaction that produces good or ill fortune.  It is inaction that drives people from their community (Ogun in the forest withdrawn from society), and it is the desire for life, a relentless life force, that drives relationships of consumption--sacrifice. But in both cases the person must trust herself to act.  And here one sees the focus of the oddu in the context of the coming year--one in which good fortune, fecundity and conflict are tied together.; one in which cycles of cinsumption will require a sacrifice by those who are unable to see the extent of what they have given. This will be a year of action and inaction bringing bad fortune; its will be a year of consumption--the world in all aspects will be consuming itself in conflict and interaction that will shift fortune and fecundity. 

This oddu speaks to the nature of sacrifice.  It brings together the passion of Oshun with that of Oya. It tells the story of Oya who to save her children gave up her favorite food and gave herself to Shango. It speaks to the unpalatable. And this is the oddu that speaks to the burden of responsibility of the way that Oshun brought Ogun out of the forest and tied him (his sacrifice) to the maintenance of the world. That eternal burden suggests a fundamental sacrifice of self--of abstract and concrete, for a greater objective.  It ties together nicely the warnings of conflict from fecundity, and of the perils of shirking duty, or cowardice.  Yet at the same time it hints that htis is precisely what may come to pass for many (not all) with the resulting disaster for individuals, families, enterprises, entities, and states. This is not the year to avoid conflict; this is not the year to avoid sacrifice for a greater objective; but it is also not a year to go looking for a fight.





The Full Version of the Letter of the Year has its own interpretaiton of these oddus with specific reference to the condition of Cuba and Cuban society. They are very general in character.  But it is possible to come to a better understanding of specific application by a careful study of the Oddu in light of the driving divine manifestations: Oshun-Ogun. That follows here:

Enfermedades que aumentan su índice:

- Enfermedades del estómago y los intestinos.
- Incremento del índice de Enfermedades de trasmisión sexual.
- Impotencia a temprana edad, como consecuencia de problemas en la próstata en los hombres.
- Afecciones malignas en colon, y recto.

Acontecimientos de Interés Social

- Continuarán problemas en el sector agrícola fundamentalmente en la producción de viandas, hortalizas y vegetales como consecuencia de la poca fertilización de los suelos.
- Penetraciones del mar que pueden producir inundaciones y derrumbes.
- Incremento de conflictos migratorios.
-Continuará el peligro y las amenazas a catástrofes naturales de todo tipo.

Recomendaciones:

- Signo que advierte sobre el peligro que puede generar el despilfarro.
- Se recomienda evitar la mala utilización de productos químicos en las producciones agrícolas.
- Cuidado con epidemias y enfermedades.
- Evitar enfrentamientos y reyertas.
- Se recomienda mantener una ética religiosa adecuada.
- Hay que buscar concurso y ayuda entre todos para lograr los objetivos trazados.
- Respetar a los mayores y buscar orientación religiosa.
- Evitar problemas con la justicia.
- Aumento de las enfermedades venéreas producto al desenfreno sexual.
- Dar mejor uso a los recursos agrícolas.
- Se recomienda un equilibrio en todos los órdenes.
- Se recomienda reforzar a oggun. (ver a los padrinos para esto).
- Hay que tener cuidado con el consentimiento excesivo de los padres para con los hijos.
- Los padres deben prestar esmerada atención al cuidado y la educación de los hijos.
- Se prohíbe auto medicamentarse.















and yet another version HERE



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A. The "Other" Version



What follows is the other version of the Letter of the Year that appeared on line, plus my own reflections.  Both become more interesting when read in conjunction with the official version. 
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Letra de Año para 2019

Signo regente: Ojuani Iwori
Primer testigo: Okana Ogunda
Segundo testigo: Ogunda Oddi

Sentencia profética: Ire san bodi elese Orisha intori ota ole Orunmila lorugbo.

Predice: El bien de mejoría viene a través del Orisha la divinidad de la tierra entre mas comida le de mas bienes obtendrá y recibirá el amparo ante las desgracias otorgado por la deidad, Orunmila todo lo resuelve y lo hace verdadero.

Divinidad regente: Oshosi
Divinidad Asistente: Oshun

Ebbo: Aunko, Akuko meyi, addie meyi dun dun, Eyele fun merin, gio gio, Eñi addie, ewe ikoko, epo pupua, asho ara, oka, ou, owo merin, opolopo owo, ewereniye merin, agwado merin, atare merin, eku, eya, oñi, oti, bobo omi, bogbo ere, oyouro oshu sere, ile atitan, ori, ofun, itana seun, bele awan, akofan, lowo re.

Onishe Ara: Ebbo misi flores frescas, miel, leche, oti, eku ella agwado, 3 hierbas de olor, perfume.

Onishe Ile: baldear entrada y salida. Ewe aberikunlo, zazafras, ewe ayo, ewe dun dun, escoba amarga, Ori, ofun, omi tutu.
Mantener la puerta de su casa o negocio libre de basura y obstáculos.

Bandera de la puerta: Azul y ribete amarillo

Obras:
– Obori Eleri
– Darle de comer a la tierra
– Hacer Ebbo y obras a los Orisha especialmente a su Orisha regente
– Hacer las obras correspondientes a la atención firme y oportuna a sus guerreros de IFA y eggun’s así también a bogbo ara onu.
– Estudiar y aprender lo mas que pueda y ser eficiente cada dia mas.
– Colgar 1 saco con ministras detrás de la puerta de su casa o negocio.
– Botar comida a la puerta para mejorar la economía.

Refranes:
– Las raíces de IFA son amargas y el fruto es dulce.
– Oye a todos y de ninguno te fies, ten a todos como amigos y cuidate de todos como enemigos.
– Si no puedes cumplir no prometas.
– No es sabio seguir lo que no asegura triunfo.
– No cualquiera termina un año bien y espera otro mejor.
Predicciones de Interés Social:
– Situaciones de violencia extrema, por mala crianza y malas compañías
– Mejoras y cambios en el gobierno traerán nuevas inversiones y estabilidad económica.
– Fenómenos naturales de gran magnitud, sismos, maremotos y deslaves de tierra.
– Huracanes, ciclones y trombas asi como tornados devastadores es un IFA de llamado de la tierra a sus huéspedes.
– Cambios climáticos por crecimiento de la tierra a raíz de la sobre población y muerte de especies en el planeta.
– Uso indiscriminado de medicamentos recetados producirá enfermedades incurables y muerte inevitable por corrupción entre gobierno, médicos y laboratorios, saldrá a la luz pública aunque será demasiado tarde para algunos.
– Epidemias y virus que pondrán en riesgo la vida de muchos por negligencia y avaricia.
– Contaminación de alimentos por virus salmonella derivado del mal tratamiento de aguas y contaminación de manantiales con pesticidas y desechos químicos provocaran muerte innecesaria de flora y fauna todo un desperdicio de recursos por mal manejo.
– Disputas y confrontaciones por rivalidades intelectuales y por falta de organización


Exploración espacial tendrá resultados positivos.
Caída de dictador dará al pueblo un respiro y una preocupación a otros.
Seguirán las enfermedades cardiovasculares congénitas, enfermedades pulmonares, enfermedades circulatorias y estomacales producidas por alto consumo de grasas, sales, azucares artificiales, comida chatarra y mala calidad de agua.
Daño renal irreparable por el alto consumo de bebidas endulzadas con azúcar artificial de importación.
Funcionarios caerán presos por desfalcos en el gobierno.
Confrontación peligrosa entre naciones por caprichos de los gobernantes.
Calentamiento de los mares provoca la muerte de algunas especies marinas lo que puede generar un alza en los costos de esos productos.
Fraudes cibernéticos pondrán en jaque a las autoridades.

Recomendaciones:
– Se recomienda a los gobiernos mejorar la legislación en materia de seguridad para dar castigo ejemplar a criminales.
– Fomentar el respeto y honradez entre las personas mantener el orden y la preservación de valores a los hijos tarea importe para sus tutores.
– Se recomienda a las mujeres cuidar de su dignidad y respeto, a las que son madres educar conscientemente a sus hijos para que asuman en el futuro una responsable paternidad basada en valores de honor y respeto.
– Se recomienda a los religiosos retomar su compromiso de humildad y respeto entre los mismos, recuerden que el más chico puede resolver al más grande que un Babalawo no tiene la cura para sí mismo y que somos la única religión y practica que los religiosos deben demostrar la humildad ante Orunmila visitándose entre sí para ayudarse y consultarse.
– Se recomienda a los padres que den mas tiempo de calidad a sus hijos conviviendo y conversando, el tiempo que malgastan en plataformas digitales cobrara caro la desatención a sus hijos.
– Se recomienda a los médicos trabajar mas por la salud de sus pacientes y dejar de hacer menos caso a las ganancias de los laboratorios medicinales y poner mas atención en sus pacientes y en vez de experimentar con medicamentos deben estudiar la medicina tradicional y herbolaria que es lo que ha hecho posible que la humanidad llegue hasta estos tiempos.
– Se recomienda al gobierno activar el campo, la agricultura y ganadería, asi como apoyo al campesino y sus familias.
– Se recomienda a los maestros en las escuelas apliquen mejor criterio en la enseñanza traten de organizar sus grupos como una familia donde se vea definido el papel cívico de respeto, disciplina y moral.
– Se recomienda a los representantes de los derechos humanos que vean mas por las personas que son víctimas y no por sus victimarios es tiempo que la sociedad se reacomode en la fomentación de mejores valores sociales y eviten su auto destrucción por excesos de libertinaje.
– Se recomienda al gobierno que detenga la producción de productos elaborados con azúcar sintética como sucraloza y demás productos que elevan los niveles de glucosa causando problemas físicos daños renales y otras enfermedades congénitas.
– Se recomienda la revisión y planificación de asentamientos humanos para evitar pérdidas y tragedias así como también revisar periódicamente edificios para evitar accidentes y derrumbes.
– Se recomienda a las personas en general no importa su religión ni estatus social, que deben conocer a los miembros de su comunidad y apoyarse en la tarea de vigilancia tanto de sus hijos como de sus bienes para mantener la seguridad y armonía entre vecinos de una comunidad o colonia.
– Se recomienda mantenerse lejos de los problemas ajenos y revueltas siempre protejan a sus hijos no exponiéndolos a la ira de otras personas al usarlos como escudos humanos.

Dice IFA:
– Dice IFA uno no es ninguno, hay que ayudarse y conocerse para poder vivir en armonía. Los religiosos se visitan para ser conocidos y para poder ayudarse entre si ya sea para actualizarse o para apoyarse.
– Dice IFA para crecer en la vida se tiene que superar muchas vivencias y adversidades la manera que se resuelvan esas etapas definirán la grandeza o la tristeza.
– Dice IFA solo aquellos que definidas sus prioridades y objetivos son los que actúan con prudencia no se dejan seducir por todo lo que les rodee y no les conviene. Es decir si una persona decide tomar el rumbo equivocado de la vida no puede culpar a nadie más que así mismo por su perdida o su error.
– Dice IFA resistirse al mal camino y educarse al buen sendero da la fuerza moral para realizar metas y cumplir compromisos de una buena vida.
– Dice IFA ningún camino es largo si se disfruta el paseo pues el trayecto o el proceso es lo que hace importante la vida, la meta es satisfacción para la muerte.
– Dice IFA quien abandona el calor pronto sentirá el frio, quien abandona lo bueno ya se abandono a si mismo.
– Dice IFA la muerte de otros siempre deja ejemplos de lo que no se debe de hacer.
– Dice IFA no hay satisfacción si el resultado no es el optimo.
– Dice IFA uno no es ninguno, la unión hace la fuerza, entre más unida una estructura es mas solida y menos impenetrable.
– Dice IFA la fortaleza se adquiere con el resultado satisfactoria después de varios intentos fallidos, no todos aciertan a la primera.


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The divination for 2018 pointed to fairly significant ruptures and also to fairly significant disclosures in the sense that what was hidden will be revealed. The emphasis was on the crossroads--communication, movement, luck, and starts, true or false--and on symbols that has traditionally been gendered female--the sea, the moon, intuition, fecundity, and protectiveness of  family. As it turned out, 2018 was indeed a year of revelations with significant ruptures; it was a year for revelations of spying, of corruption, and of sexual impropriety.  It was a year in which careers and states were upended by reason of revelation and communication. 

The divination for 2019 takes a different turn.  It is founded on two very specific manifestations of the divine--Ochossíand Oshun.  The first manifests justice, the other love. The justice manifested in Ochossí is both relentless and strict.  The common pataki (sacred story) of the manifestation of Ochossí (there are variaitons):
Ochosi was an expert hunter and he found the bird without a problem. He took it home and put it in a cage, and then went to tell Orula that he had the bird.  While Olofi was out, his mother came home and found the bird in the cage. She thought it was meant for their dinner, so she killed and dressed the bird, and then she went to the market to buy some of the condiments she needed to cook it.  Ochosi came home and saw the bird was dead, and he was very upset. He didn't know who had killed it, but he decided that he needed to go get another bird right away, so Orula would be able to give it to Olofi.  Ochosi hunted and trapped a second bird and gave it to Orula and, together, they went to present the bird to Olofi.  Olofi was so happy with the gift that he wanted to reward Ochosi, so he gave him a crown and made him an Oricha on the spot.  He asked Ochosi if there was anything else he wanted, and the hunter replied, yes, he wanted to shoot an arrow into the air and have it pierce the heart of the person who killed the other bird.  Olofi, all knowing, understood what Ochosi's words meant, so he asked if Ochosi was sure that's what he wanted.  Yes, said Ochosi, I want justice, and Olofi granted his wish.  Ochosi released an arrow and almost at once he heard his own mother cry out. The arrow had pierced her heart and killed her.  Ochosi was terribly sad when he realized what he had done, but he also knew that justice had been done.
Oshun, on the other hand, is love and sensuality in all of its aspects, both physical and conceptual. She speaks to what is sweet, and beautiful, but also what is precious and valuable.  She is intimately connected to the female, but she does not limit her followers to women. She is beauty, love, prosperity, wealth, fecundity, but also vanity, whim, seduction, and a quick temper and inflexible when crossed.  She is life force in all its force, even as Ochossí is the force of justice without constraint. She amplifies both the positive and negative passion of love and accumulation, of attraction and wealth.  

This combination of blind justice and love suggests that context within which the oddus might be approaches.  That is, they might be read usefully as sitting within a complex web of blind justice that is relentless exposed, but tempered by love, or augmented by love's rejection.  Thus the context is not the usual one in the West--justice tempered by mercy, and its variation.  Instead, it appears to speak to justice whose "arrow" will not miss its mark but the intensity of feeling will augment or diminish the intensity of that arrow. Both point to inflexibility though of different kinds.  Both are bound by their character--justice (not truth) or love and accumulation (not lust or avarice)--and inflexible when challenged. Thus, the context is not the usual 0-1 binary but rather a sense of two aspects of intensification for 2019--one focused on justice and the other on material things and human relations.

I will not speak to the specific advice given in the letter of the year, nor to its suggestions for sacrifice.  I note though that the interpretation of the oddus in light of the guiding manifestations of the divine are interesting, and quite pointed for states. But all touch more specifically on the guiding principles that will shape the year and that are embedded in the oddus. These suggest quite specific recommendations for Cuba and the Cuban state (with respect to its governance, its economic policies and the like).   

My focus in the reflections that follow go to the general indications of the oddus themselves and their potential broader implications. The oddus (reflections based on the translations and oddus in The Sacred Ifá Oracle (Afolabi A. Epega and Philip Neimark, Brooklyn NY: Athelia Henrietta Press, 1995)

1. Owonrin 'Wori (The Sacred Ifá Oracleno. 80). Within the intensities of Ochossí and Oshun, the oddu Owonrin wori acquires a peculiar cast. It speaks generally to the need for great effort to alleviate the lack of material, and spiritual wealth, and likely, as well, a poverty of justice.  It suggests that 2019 will likely see either create laziness or great effort devoted to the attainment or avoidance of justice, of material or emotional wealth. One starts 20'19 in a world in which there is great fear of the loss of material wealth as love ebbs. Isu wón, epo wón, ohungbogbo ti enu nje li o wón (Yams were dear, palm oil was dear, corn and other foods were dear). A sacrifice was required  so that these items would become less expensive (Won ni ohungbogbo to wón fún wón l'ode Iwori yi, ki wón wa rubo ki opo le de fun wón).

That sacrifice was focused on the tools through which the expensive could be made inexpensive--tools, weapons, fish, animals and money.  These, of course, point to those tools necessary to overcome the problem--but not immediately nor through the work of others. Both justice and accumulation will require a substantial investment of effort by those seeking either.  Babalawo niki gbogbo okunrin ko okó ati adá kiwon maa re oko lo sise ki opo le de(The Babalwo said all the men should take up their hoes and cutlasses and go to work on the farm so that food would become less expensive).

Expect there to be substantial investment in investigations, in investment, in the accumulation of objects that point to justice, wealth and love.  But also do not expect a straight line between investment and a targeted outcome.  Ochossí shot his arrow into the air; it was guided by the intensity of spirit that had it find its mark; but that mark was both unexpected and quite dear to him (his mother).  There will be justice and accumulation for those working towards them, but the results will be both unexpected and will require a sacrifice.  Justice will see vindication but at great cost. That cost will substantially affect the fundamental organization of the community within which justice is sought.  And it will fall on those whose intentions were good, and indeed, essential to the well being of those seeking justice. The resulting satisfaction at rendering justice will have profound long term effects on the constitution of the community (the family, the society, the enterprise, the state). 

But where is Oshun's influence in this oddu? That comes next.  For the oddu also speaks to passion and madness.  In divining Ifá for Ojúogbebikan, he was advised to sacrifice to prevent his spouse from becoming mad, or if mad already, to regain her sanity (a niki ó wa rúbo ki aya re ma di wèrè, biobati do wèrè ki lo le sàn). The scaricie: snails, coweries and Ifá medicine.  This points again to the costs of justice, and its result.  That madness will also require sacrifice, in turn.  But will the sacrifice be justice?  Now one of the oracular sayings of the 2019 letter may be clearer: "Las raíces de IFA son amargas y el fruto es dulce" ("the roots of Ifá are bitter but its fruits sweet") The others are interesting in that light as well, though to a lesser degree (Oye a todos y de ninguno te fies, ten a todos como amigos y cuidate de todos como enemigos; Si no puedes cumplir no prometas; No es sabio seguir lo que no asegura triunfo; No cualquiera termina un año bien y espera otro mejor). All suggest caution (but then most oracles tend to do that) but also carry warnings about intimacy and relations among actors.  These suggest as well a caution against reliance in a context the primary focus of which is on self helñp, but in the pursuit of quite specifically underlined goals--justice and accumulation.

2.
Ogunda Oddi (The Sacred Ifá Oracle no. 110). In contrast to Owonrin 'Wori, the oddu Ògunda 'di speaks to journeys.  And not just journeys or travel by anyone, but by Oggun--the personificaiton of industry, and perhaps economy.  This is the oddu for globalization, but also of investigations, of investments, and of processes that are meant to lead to some objective.  And it suggests disorders.  Ogun was intent on travel and packed his bags. Orunmila said the journey would be pleasant and he would return safely (Ogun nre ajo o di erù kale, Orunmila I'ònà ajo Ogun a dára. Ogun a bowa ba ilé ni ire). The sacrifice required--animals, oil, nuts, and coweries.

But on the journey there might be internal disorder. It speaks to diving leakages of newly prepared kalabash (a form of gourd). The leakage could be blocked but with an appropriate sacrifice of putty, thorns, coweries and the application of Ifá medicine (Wón ni: Ìdí akeregbe a maa jo. A niki o wa sebo ki edidi le di ibiti o njo fún un). This suggests both that the framework within which important materials will be kept and moved about is imperfect and will lose its contents.  It can be fixed, at soem cost, but also by ignoring its imperfection in the form, of the patch.  What emerghes is a gourd that is not perfect but patched, at some expense.  And yet the Ifá does not suggest a wholly happy solution: Àrun idí tabi Iyagbe yoo maa ba eniti a da Ifá yi fún je, bee ni Ifá wi (Ifá notes that if this oddu is divined then the object of divinaiton suffers from dysentery).  Now the dysentery image points back to the first part of the oddu--just as the gourd may leak, so may its bearer.  Both will require patching, and in the process will not be the same again.

It is interesting to note this supporting supporting oddu in the context of the principal focus on  the need for self help within the context of justice and passion of Owonrin 'Wori.  It emphasizes the warning of the principal oddu of the flaws even in the most well intentioned and well constructed journey or objective or investigation.  That which will produce intensity and justice will itself be flawed; it will leak, and it will be undertaken by  those (individuals, institutions, communities) that themselves are "leaking" in the sense of their own internal failings.  The result will intensify the consequences of even the most well intentioned (and flaws) undertaking.  We will likely see this in both large and small matters in 2019.  

3. Okana Ogunda (The Sacred Ifá Oracle no. ). It is interesting that both supporting oddu touch on Ogunda--that is the oddu that tends to speak to disputes, contestants, the bitterness that is generally referenced at the root of Ifá. Ogunda also is closely linked with Ogun--of industry and conflict. This tends to shift the emphasis  of the Letter of the Year oddus from justice and accumulation that is peaceful to that which is contested. Yet it might be remembered that some patakis (stories) note the close relations between Ochossí and Oggun (Ochossí could hunt but not get to prey in the dense forest; Ogun could make weapons to cut through the underbrush but could not hunt; together they made a stronger team). There will be little peace in the processes of justice whose arrows will likely cause more dispute).  This last supporting oddu speaks to self preservation.  It speaks to the avoidance of confrontation but also a warning that things are never as they seem.  From the outside one is seen to treat everyone well; from inside one divides friends from enemies.




"Globalization, Sustainability and Firm Cultures"-- Program of the AALS Section on Economic Globalization and Governance Presented at the 2019 AALS Annual Meeting

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The Association of American Law Schools (AALS) sponsors an annual meeting attended by substantial numbers of academics based primarily in U.S. law schools. This year, the annual gathering is being held in New Orleans, Louisiana from Wednesday, January 2 – Sunday, January 6, for the 2019 Annual Meeting. Under the theme of “Building Bridges.”  Wendy Collins Perdue, the AALS President noted in her "President's Message", in part that:
Lawyers are not social workers, but they are, as Lon Fuller put it, architects of social structure. And in that role as architects, they can be—we can be—enormously helpful in reconnecting a fractured world. That is to say, in building bridges. So that is my theme for the year: building bridges. I hope that we can put on display our traditions of professionalism, civility, and reasoned disagreement, and inspire the next generation to “think like a lawyer” about society’s problems: to listen, consider, reason, collaborate, resolve, and even heal." (President's Message)
The AALS' many interest sections sponsor programs that tend to highlight and interrogate current issues of substantial concern to its members and of genera interest to the legal academic community.

I am a member of the AALS Section on Economic Globalization and Governance, and its chair elect.  Our current chair, Lynne L. Dallas, University of San Diego School of Law, developed a quite provocative program, Globalization, Sustainability and Firm Cultures. The program is one that highlights many of the critical issues at the intersection of law, economics, national, and international, public and private law that continue to bedevil actors and institutions within what we euphemistically call globalization. Its investigation is enriched by the scholars contributing to that discussion, Miriam A. Cherry, Saint Louis University School of Law, Virginia Harper Ho, University of Kansas School of Law, Jeff Schwartz, University of Utah, S.J. Quinney College of Law, and me.


The details of the Section Program follows below, along with very brief thoughts.


Globalization, Sustainability and Firm Cultures
Thursday, Jan. 3, 2019, 10:30AM-12:15PM

Chair: Lynne L. Dallas, University of San Diego School of Law
Moderator: Cheryl L. Wade, St John’s University School of Law
Speakers:
Larry Cata Backer, Penn State University, Penn State Law
Miriam A. Cherry, Saint Louis University School of Law
Virginia Harper Ho, University of Kansas School of Law
Jeff Schwartz, University of Utah, S.J. Quinney College of Law
This panel will evaluate progress in promoting sustainability standards for multinational enterprises (MNEs). It will explore why some MNEs continue to engage in abusive practices that support environmental degradation, unsafe working conditions, and the like. It will also explore various actions taken by some MNEs, institutional investors, and banks that further sustainability objectives. The panelists will debate the moral and ethical responsibilities of MNEs, whether to maximize shareholder value or to pursue sustainability objectives that take into account the interests of society and all firm stakeholders. They will present their perspectives on the importance and effectiveness of corporate codes of conduct and the significance of social exhortations by various public bodies to pursue sustainability objectives. They will also explore regulatory gaps due to the loss of national sovereignty over global enterprises and how corporate cultures can change to further sustainability objectives.

The panelists will focus on the following scenarios. Time permitting, audience participation will be welcomed after each scenario.

Scenario One: Can we see progress in sustainability standards followed by multinational enterprises (MNE)? For example, a recent study showed that 78% of S&P 500 companies are issuing sustainability reports. Is this a reflection of corporate cultures that embrace sustainability or are they mostly greenwashing? What measures (legal, nonlegal, internal or external) are most effective in encouraging sustainability practices by MNEs? What are the impediments to these measures? Is sustainability an appropriate goal for for-profit corporations? If so, what weight should it be given to it in corporate decision making? Panelists: Jeff Schwartz, Virginia Harper Ho, Miriam Cherry

Scenario Two: In September 2018, global NGOs, including Friends of the Earth and the Sierra Club, kicked off a campaign to pressure BlackRock, one of the world’s largest investors, to (1) divest from fossil fuel companies, (2) vote its shares in support of shareholder proposals on sustainability and climate risk disclosure, and (3) actively engage with companies it owns in order to pressure them to align with the Paris Climate Accord. How should BlackRock respond? What factors should it take into account? Is its involvement regarding these issues justified and consistent with its fiduciary duties? Panelists: Virginia Harper Ho, Jeff Schwartz, Larry Cata Backer

Scenario Three: Agri Corp, a multinational corporation incorporated in Delaware, has multilayered subsidiaries that constitute a massive global supply chain for agricultural products. One of its subsidiaries has a joint venture with a cooperative that allegedly practices gender discrimination by imposing informal rules (strongly supported by local custom and tradition) that prevent women from controlling agricultural land. It is claimed that Agri Corp has failed to meet international guidelines for gender equality. How should Agri Corp. respond? Panelist: Larry Cata Backer

Scenario Four: Babble, Inc. is a digital platform headquartered in Palo Alto, California. It provides language lessons on a digital crowdwork model. 170-plus countries can get language tutoring for $10 an hour. Only $4 is passed on to workers. Because of flexible working time, Babble argues that these workers are are not really “employees,” and it shouldn’t have to pay applicable taxes or social security contributions. What are the potential problems, issues, and concerns that go along with the crowdwork business model? How can corporate codes of conduct be used to alleviate the problems? How can such codes be formulated? Panelist: Miriam Cherry

The Section’s business meeting will follow.

__________

The discussion around the scenarios highlighted a large number of issues, all substantially unresolved.  It was interesting to see in the U.S. discussion, a parallel with discussions I have heard in other legal systems, manifest certain tensions and hesitations.  

The first is what I call the traditionalist nativist problem; the reflex to focus problem definition and solutions around native law, law systems, and national legal-cultural principles.  This suggests that national law remains to some extent detached form law making elsewhere.  It also suggests a detachment form international and national sources.  It is in a way a very traditional approach to the context of national law systems of which the United States and China remain the most influential drivers.

The second is what I call the second order solution problem; the willingness to effect, without much worry, an effective governmentalization of the private sector by relying on disclosure based transparency solutions without requiring the political branches to directly confront the need for normative (substantive) law making.The difficulty here, of course  is that in the process law is itself transformed from the source fo norms to the apex router; law becomes a systems manager while the actual expression of normative content in rules is left to the institutions onto which disclosure is mandated producing a regulatory governance structure that leaves normative development to the market(s). 

The third is what I call the law-norm conundrum. This is a global disease with its own set of contradictions. On the one hand, the second order solution problem creates incentives toward delegation of substantive rule making.  On the other none law based substantive rules are viewed as ineffective shadows of the legitimacy of law making by political bodies. The problem becomes more pronounced where global structures of regulatory governance are viewed as less legitimate precisely because either markets source rules or because the normative basis of such rulemaking is not binding in the snese that it does not reflex the definitive word from within specific domestic legal orders.

These problems make the resolution of the acute problems of the age--nicely summarized in the four scenarios that formed the basis of the discussion--both intractable and incoherent.  It is intractable because the contradictions inherent in the three great problems create unavoidable conditions un-acountability, of norm shopping, and as a result of the certainty that solutions, however adopted will be neither scale-able nor comparable.  Each enterprise, and each problem, will produce solutions that are themselves unique, and to that extent, of less value to markets and thus to the risk management, compliance, accountability framework within which firms operate.  That is a pity unlikely to be resolved anytime soon.

Yet within that context it is possible to identify five broad issues areas that will likely factor into the resolution of each of the scenarios.  They include the following.

1. The issue of definition.  One tends to paint compliance in the sustainability area with a broad brush.  Alternatively one divides corporate responsibility into categories for which "sustainability" embraces environmental (and sometimes climate change) issues, and "human rights" and "labor" embrace others.  Even within those categories, the ability to define the normative scope for each for purposes of creating  objectives that ca be assessed becomes difficult at best.  Difficult because there is no consensus, and indeed, a marketplace of standards has now arisen.  In the absence of coherence here, definition loopholes can be used to the best advantage of the enterprise.  This is not to suggest intentional efforts to subvert, but certainly incentives to use the concepts strategically within the business model of specific forms.

2.  The issue of scope. What comes within and what falls outside the problem and the solution has become substantially contentious. In the absence of consensus standards, there is little guidance and much strategic use of variations to suit the needs of civil society, consumers, government and enterprises. These issues of scope bedevil all aspects of the "social responsibility" context, irrespective of the foundation in law or norm, national or international. These are old issues as well, and ones that pit the fundamental ordering principles of corporate law, against international human rights law regimes, against environmental law regimes and the like. In the absence of intra-state resolution of these contradictions, international approaches are unlikely to provide a solution.

3.  The issue of the character of active engagement.  Outsiders want enterprises to be actively engaged.  Financial firms ought to be actively engaged with the enterprises to which they have loaned money or whose securities they hold.   Operating companies ought to be actively engaged in the operations and structures of decisionmaking (including operational values making) down the production chain all the way to the origin of base materials. This active engagement can sometimes run against principles of national or firm autonomy built into legal or political systems.  And they might well transform regimes of liability beyond the field of social responsibility without any sort of debate about these externalizes or the larger issues of policy coherence involved.   That last comment does not suggest a judgment but rather the certainty that this state of affairs will create the sort of oppositions that impede any progress toward solution of "corporate responsibility" related issues.

4.  The issue of soft law models. Soft law models provide both the most likely source of normative values and the least satisfying source for those seeking the certainties of law.  More troubling, of course, is that these soft law models contribute to a great market for values (and regulation) that now characterizes this field.  To some extent this is similar to the traditional problem of regulatory competition within and between states. And form the perspective of the enterprise it contributes to the evolution of law (and norm) from an operational principle to a consumable commodity in the production of goods and services.

5. The hardwiring issue. When all else fails (and "all else" appears to fail comprehensively in this area), it is left to delegate rulemaking and enforcement to the enterprise.  This governmentalization of the firm pushes downward from the state (through programs of incentives and disclosure rules) and upward from constituents (civil society as proxy for communities, consumers, and investors).  But hardwiring produces problems of its own.  These include tailoring the rule system to exclude critical stakeholders (e.g., codes of conduct provide no remedial rights to affected workers and others) and makes it impossible to develop uniform policy--even within industrial sectors--as enterprises pick and choose the standards it will adopt and enforce, as well as the manner of enforcement.  

Within these constraints, the discussion of the issues, and the breadth of approaches to solution, was lively and quite interesting. If there was any consensus, it revolved around the problems of greenwashing--the all to tempting use of the ambiguities and lacunae--to produce the appearance but not the fact of compliance. It also revolved around the utility of transparency regimes as a second order governance tool.  In a sense, this conforms a slow but now clear move in the development of tastes for regulatory governance--and reliance on the market--for resolving governance issues now impossible for the state to confront directly. The market, then, becomes the space within which consumers and investors, produce and consume disclosure, and thus drive norms. The state manages the process the way it manages financial markets.  That may be enough. Consequential issues of democratic participation and legitimacy, though, still will be left for another day--it might be enough, though, that law is used to provide the constraints within which regulatory governance functions.  Yet one is left to wonder whether under such regimes, if enterprises will effectively be treated as administrative agencies. And if that is the case, then the gaps between state owned enterprises and private enterprise managed through regulatory governance structures narrows just a little ore.

Just Published Vol. 53(4) Latin American Research Review

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The latest issue of the Latin American Research Review has just been published.  Table of contents with links follows.




Vol. 53, No. 4
TABLE OF CONTENTS

Literature and Cultural Studies

Politics and International Relations

Remittances and Vote Buying
Ezequiel González-Ocantos, Chad Kiewiet de Jonge, Covadonga Meseguer

Sociology

Anthropology


New Paper Posted: "Systemic Constraints on the Human Rights Obligations of States, and State Owned Enterprises"

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I take this opportunity to let folks know that I have recently posted a draft of a new essay entitled: Systemic Constraints and the Human Rights Obligations of States and State Owned Enterprises.

A little bit about the essay: In the contemporary global order constructed through markets and multilateral frameworks of regulatory governance, the state occupies a curious place.  The state retains its core function as an apex form of regulation within its territories (even as the forms that this regulation takes shifts from statutes, to administrative rules, to data driven accountability based governance).  At the same time, the state has become an important participant within the markets it itself regulates.  Through its state owned enterprises (SOEs) and other instruments, the state engages in economic activities within its territories as regulator and producer; outside its territories those instruments of state economic power operate within complex and evolving law, norms and rules functioning like other commercial ventures in global markets. SOEs also share the state's dual character--as market participant and as the projection of state power in markets. This dual character shapes the way in which it is possible to construct (and constrain) regulatory structures for the responsibilities of business to respect human rights. That tension between human rights regulatory structures and the dual character of SOEs is the object of examination of the essay. 

As always, comments, suggestions, reactions are most welcome.  A later version of this essay will appear in Research Handbook on Human Rights and Business (Surya Deva, ed., Edward Elgar forthcoming 2019).    

The essay may be accessed HERE.  The abstract and introduction follow below.





Larry Catá Backer

Abstract: The state occupies a curious place in the contemporary global order constructed through markets and multilateral frameworks of regulatory governance. The state retains its core function as an apex form of regulation within its territories (even as the forms that this regulation takes shifts from statutes, to administrative rules, to data driven accountability based governance). At the same time, the state has become an important participant within the markets it itself regulates. Through its state owned enterprises (SOEs) and other instruments, the state engages in economic activities within its territories as regulator and producer; outside its territories those instruments of state economic power operate within complex and evolving law, norms and rules functioning like other commercial ventures in global markets. SOEs also share the state's dual character--as market participant and as the projection of state power in markets. This dual character poses challenges and opportunities for the development of a rules based approach to the responsibilities of SOEs to respect, and the duty of their state owners to protect, human rights. Section 2 considers fundamental issues of the nature of state obligations and the definition of SOEs. Section 3 then examines the central question of this essay—given the structures and trends in the development of frameworks for business and human rights, where and how do SOEs fit into these structures? The section first examines the way that emerging international soft law regulatory structures envision the role of SOEs within these human rights based regulatory standards. It then considers future challenges. The section ends with a set of brief recommendations.

1. Introduction

 The question of the State Owned Enterprise (SOE) is as old as the construction of modernity, at least from the time of the great European colonization that started in earnest in the 15th century. The distinction between the economic activity and its regulation was only loosely conceded, as was the relation of law to government.[1] The state, the Church, the enterprise were bodies corporate[2] whose jurisdiction and powers were different in form but sometimes not in kind from those other bodies corporate which existed in various states of autonomy and dependency from the enterprise of the state.[3] From the state, to the Church, to the enterprise—these bodies corporate constituted a continuum which served individual, corporate and national interests, which during European early modernity were all directed toward the construction of the first era of European globalization characterized by its outward migration and ideologies of colonialism as a basis for international relations.[4]

To speak of the state, then, or of the enterprise, was to speak of related aspects of what the Chinese Communist Party would call in a much later age the development of productive forces,[5] toward the ends some sort or another of social good. This strategic embedding was a constant through the 20th Century, even as the development of the state as the apex organization of political authority produced a utilitarian typology that separated public from private, and economic, social, religious, and economic spheres. The seams of that typology bore a constant tension—the operation of the state in economic life, the governmentalization of the enterprise, the religious foundations or intermeshing between law and religion, and the like. Managing that tension produced the great complex that is the law of sovereign immunity, and for our purposes in this chapter grounded in the efforts to separate the public functions of the state from its commercial endeavors.[6]

Now within the structures of contemporary economic globalization that the question of the SOE has become an issue with institutional, regulatory and, especially, human rights dimensions. The question arises even as the centering character of the organization of societies has shifted from the political to the economic, and from the command of monarchs to the determination of markets. The model was Europe after 1945. “Five years to the day after the end of the War in Europe, the reconstituting mania, the furor constituendi, manifested itself in a surprising new form. Europe would seek to reconstitute itself, not as society, nation, or state but as economy.”[7] Within that economy the roles of states and of enterprises appeared to change, and with it, their respective roles and obligations within regulatory orderings, especially with respect to human rights.[8] These changes were felt most acutely in the construction of an economic global order, and they converged around two foundational trends at the end of the 20th century. The first saw an increasing conflation in the dual roles of states as both sovereign regulators and as sovereign enterprises. The second saw the migration of the sensibilities of the social obligation of the state[9] to the enterprise, but in a context in which the legal order differentiated between states (as regulators and public bodies) and enterprises as private bodies embedded within local, national, and global markets.

After 1948,[10] that social obligation increasingly took on the forms, language, and principles of human rights, the principal lens through which social obligation was focused.[11] Since the last third of the 20th Century, these questions have been complicated by a further wrinkle—one that In the form of the SOE, then, the question became—should it be treated like an enterprise or treated as an expression of state economic power, or as something else? The reason for the complication emerges in part from the ideology of globalization. It embraces the fundamental principles of the post 1945 global economic order. These include the principles that advanced economies are characterized by markets, that the primary role of states is to regulate and manage those markets through systems firmly rooted in rule of law, and that the primary actor in such systems are private (non-governmental) economic actors.[12]

Within that triadic relation that defines contemporary globalization —markets, states, and enterprises—the SOE is an anomaly. SOEs disrupt the fundamental typology in which globalization is founded. That has, in turn produced a great tension—on the one hand, international institutions have sought to ensure that SOEs are operated like and treated as a private enterprise equivalent; on the other hand, the connection to the state is unavoidable and the SOE is also understood to be an instrumentality of government with the burdens of the duties of state and its protections, especially for its owners.[13] Especially in the context of the state duty to protect and the corporate responsibility to respect human (both under international law), the SOE occupies an ambiguous space, as both a state entity (direct or indirectly owned or managed), and as a commercial enterprise engaging with others in global markets. It follows that the SOE, then, occupies a unique space within the construction of both national and international standards for human rights in economic activities. SOEs are not entirely state instrumentalities, nor are they private enterprises. SOEs may be operated as commercial ventures, but their owners have a core duty to advance the political interests of states. SOEs may be regulated internally by their home states—indeed they may be conflated with the home state government—but when they engage in economic activities, especially abroad, they are expected to conform to the generally applicable framework for markets-based economic of private entities.[14] That framework may also give rise to responsibilities within international regulatory regimes beyond and potentially incompatible with the domestic legal orders of the state whose instrumentality they may be.[15] They are both the means of organizing economic activities, and for their governmental owners/regulators they constitute “large portfolios . . . which have risen as significant actors in the global economy, active at home and abroad in diverse sectors such as energy, utilities, infrastructure, transports, telecommunications, and banking.”[16] Within an architecture of human rights regulation that distinguishes between public duty and private responsibility, how does the SOE fit into emerging regulatory and normative structures?

This chapter considers the core issues of SOE responsibility to respect or protect human rights under emerging international standards. Section 2 considers fundamental issues of the nature of state obligations and the definition of SOEs (to be distinguished from sovereign wealth funds covered elsewhere in the Handbook). In that context, regional variations and the basic animating principles of SOEs are considered. With that definition as a baseline, Section 3 then examines the central question of this chapter—given the structures and trends in the development of frameworks for business and human rights, where and how do SOEs fit into these structures. The section first examines the way that emerging international soft law regulatory structures envision the role of SOEs within these human rights based regulatory standards, with a focus on the UNGP, and with reference to the 2016 ‘Report of the Working Group on the issue of human rights and transnational corporations and other business enterprises.’ (WG 2016 Report)[17] Section 4 then considers future challenges. These include issues of sovereign immunity, of hybrid claims, of veil piercing and agency. These serve as the legal principles that may both inhibit and make possible the development of a remedial set of legal obligations on the part of both SOEs, and of their state shareholders. Section 5 concludes with brief recommendations. To understand the nature of the responsibilities of SOEs under regimes of international human rights, then, it will be necessary to untangle the relationship between the SPE and the state, between the state as regulator and the state as owner, and between the conduct of the state and its SOEs within the home state and in the host state.

NOTES:

[1] Larry Catá Backer, ‘Reifying Law - Government, Law and the Rule of Law in Governance Systems’ [2008] 26(3) Penn State Int’lL.Rev. 521

[2] Allison D. Garrett, ‘The Corporation as Sovereign’ [2008] 60 Me.L.Rev. 129.

[3] Neil MacCormick, ‘Beyond the Sovereign State’ [1993] 56 ModernL.Rev. 1, 16.

[4] Antony Anghie, Imperialism, Sovereignty, and the Making of International Law (Cambridge2004)

[5] Deng Xiaoping, ‘To Build Socialism We Must First Develop Productive Forces’ (The Selected Works of Deng Xiaoping: Modern Day Contributions to Marxism-Leninism, April-May 1980) https://dengxiaopingworks.wordpress.com/2013/02/25/to-build-socialism-we-must-first-develop-the-productive-forces/> accessed December 11, 2018.

[6] George W. Pugh, ‘Historical Approach to the Doctrine of Sovereign Immunity’ [1953] 13(5) Louisiana L.Rev. 476.

[7] Philip Allott, The Health of Nations: Society and Law Beyond the State (Cambridge2002), p. 205.

[8] Andrew Clapham, Human Rights Obligations of Non-State Actors (Oxford, 2006); Surya Deva, ‘Huan Rights Realization in an Era of Globalization [2006] 12 Buffalo Human Rts L.Rev. 93, 112-115

[9] Adam Smith, An Inquiry into the Nature and Causes of the Wealth of Nations (first published 1776, Edwin Cannan ed., Univ. of Chi. Press 1976) pp. 213-44

[10] See Universal Declaration of Human Rights Res. 217A (III) (10 Dec. 1948) ; discussed in Larry Catá Backer, ‘The Role of Companies in Privatizing Socio-Economic Rights in India and China,’ in Surya Deva, ed., Emerging Free Markets: Comparative Insights from India and China (London: Routledge, 2015), pp. 44-70.

[11] Birgit Spiesshofer, Responsible Enterprise: The Emergence of a Global Economic Order (Oxford: Hart, 2018).

[12] Organization for Economic Cooperation and Development (OECD), OECD Guidelines on Corporate Governance of State-Owned Enterprises (Paris, OECD, 2015), ‘About the Guidelines’ Pp. 11-12 [hereafter ‘OECD SOE Guidelines’]

[13] Clifford Chance, ‘State Immunity and State-Owned Enterprises: Report Prepared for the Special Representative of the UN Secretary General on Business and Human Rights’ (December 2008).

[14] OECD SOE Guidelines; U.N. Guiding Principles of Business and Human Rights (New York and Geneva, U.N., 2011)[hereafter UNGP]; Organization for Economic Cooperation and Development, Guidelines for Multinational Enterprises (Paris, OECD, 2011) [hereafter OECD Guidelines] (“State-owned multinational enterprises are subject to the same recommendations as privately-owned enterprises, but public scrutiny is often magnified when a State is the final owner.” Ibid., pp. 22 (Commentary, General Principles ¶ 10)) .

[15]‘Report of the Working Group on the issue of human rights and transnational corporations and other business enterprises.’ A/HRC/32/45 (4 May 2016), ¶¶ 12-17.

[16] Press Release, ‘State-owned enterprises must lead by example on business and human rights – New UN report’ [17 June 2016] Office of the High Commissioner for Human Rights.

[17] A/HRC/32/45 (4 May 2016).

When Private Approaches Go Public: Brazil Establishes National Guidelines on Business and Human Rights: Decree No. 9.571 (21 Nov 2018)

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Especially since the start of international efforts to create a single comprehensive treaty for business and human rights (see, e.g., here, here, and here), states have started to adopt legislation that regulates some aspects of the human rights effects of economic activity. This legislation has widely varying scope and effect.

Much of this legislative effort has been directed at specific issues--so-called modern slavery and supply chain management (e.g., here, here, and here).  These tend to adopt disclosure related obligations (here, here).  The object is to create second order regulation--by imposing obligations to disclose with respect to compliance with certain (usually non legal or binding standards within a domestic legal order) the state seeks to effectively impose the underlying obligations on enterprises who wish to avoid the consequences of "bad" disclosure.  This effectively uses a form of regulatory governance in which markets provide the incentive to legalize substantive obligations within enterprises without the need to adopt law.  

Brazil has appeared to open the door to another path--one that echoes developments in private governance much more than the direction of public governance through disclosure regimes. This new approach was embedded into law in Brazil when in November 2018 it adopted a decree establishing National Guidelines on Business and Human Rights: DECRETO Nº 9.571, DE 21 DE NOVEMBRO DE 2018 (Estabelece as Diretrizes Nacionais sobre Empresas e Direitos Humanos). The text of the new regulations follows with a brief analysis produced by Leticia Sarto for Marquez Filho Advogados (Portuguese original with my crude English translation). This is preceded by my brief preliminary observations.



The process of convergence between the public and private spheres continues at an ever accelerating pace. This trajectory is very much in evidence in the context of the regulation of the human rights effects of economic activity.  Traditionally, states would seek to manage such effects through its traditional tools--statutes, administrative regulation, licensing, and judicial authority (but circumscribed by the limits of the national domestic legal order). These produced cultures of compliance increasingly centered on regimes of disclosure, the normative aspects of which would be allocated by the market. Regulatory governance (e.g., here) has become the primary vehicle for the regulation of human rights in economic activity within states. Managerial techniques grounded in data driven assessment were less often used by states (except China) though increasingly by business (in the West). 

The limitations of that approach through the early 2000s produced two then independent alternative approaches.  The first was an approach embedded within the then maturing system of public international organizations.  As public international organizations were ceded greater (though still limited) authority to regulate (or manage), they were increasingly viewed as an appropriate site for the development of regulatory mechanisms.  This (partial) consensus was based on the notion that states were unable to deal effectively with governance gaps, that the power of single states to solve the "governance gap problem" by the extraterritorial extension of their own laws were problematic at best (unless one liked the law or the state or both--deeply political and fragile judgments at best), and that the multilateralism at the heart of economic globalization could only be managed by an equally multilateral approach to the governance of human rights in business. Those views produced much heat and only partial success.  The goal of developing very strongly based (and directly applicable) international instruments that bound states and enterprises were ultimately rejected.  On the other hand, the period form the early 2000s produced a sort of golden age for international soft law. Key products among these were the various guidelines produced by the OECD, and, of course, famously, the UN Guiding Principles for Business and Human Rights

The second was an approach grounded in the emerging structures of transnational law, and from the 2000s centered on the enterprise itself.  That produced two great movements.  One movement produced increasingly complex  regulatory systems within global production chains (see. e.g. here and here). In effect, these resulted in the creation of self referencing regulatory systems within global production chains, overseen by apex entities which effective authority to manage not just themselves, but most actors within the chains of production they managed. 

But there was another movement as well.  This one privatized regulatory governance at the transnational level.  The growing interest in enterprise self management within functionally differentiated production chains also gave rise to strong markets for substantive and procedural structures around which such private governance systems could be organized.  Originally, the international soft law produced by international organizations appeared to dominate the field.  They constituted an oligopoly of sorts, whose product were norms and whose consumers were public and private regulators.  Increasingly, however, private actors entered the field of regulatory governance.  They sought to meet emerging market needs for norms and methods of operation for systems of human rights in economic activity systems. They were successful to the extent they could offer specialization in areas where there were less desirable public "product."  

More importantly, they were successful where they offered services that effectively supplied more of the architecture of a regulatory system--from  norm creation, to implementation, to monitoring, and to disciplining infraction. It is true enough that there were public international antecedents (e.g. here), but the private models were desirable specifically because they could be specifically tailored to the needs of clients in specific areas of economic activity. Certification programs have flourished in the private sector.  As Errol E. Meidinger has noted:
The central purpose of forest certification programs is to verify for interested outsiders that the management activities of certified enterprises are acceptable and appropriate. In doing so certification programs take on important public roles. First, they define what kind of behavior is acceptable and appropriate. They do this in various ways. Some programs include considerable public input and participation, others very little. Some stress multi-stakeholder decision-making while others rely entirely on industry associations or firms. No major certification program, however, relies primarily on the policy formation processes of government. Second, certification programs establish mechanisms to enforce their policies, and to provide public assurances that they are being met. Again, most do not rely on existing governmental enforcement programs. Rather, they devise their own organizational monitoring, auditing, and adjudication systems, and seek to establish credibility independent of government agencies. Products from certified forestry enterprises are generally entitled to display a logo that is meant to signify their social propriety. (Forest Certification as a Global Civil Society Regulatory Institution, pp. 265-266).
And there is the potentially interesting innovation of the Brazilian approach.  Here the state adopts an approach emblematic of private governance.  What makes this particularly interesting is the relationship between law and compliance. Law then assumes an interesting characteristic.  It serves to establish the modalities of governance, but not that governance itself.  It provides a framework for a voluntary system in which the state, itself, embeds international normative structures within a system in which it can appropriate a power to certify (and decertify) enterprises.  It creates a community that is voluntary yet compulsion will be augmented to the extent that (perceived) market pressure militates against ignoring the certification regime. And it converts legal rule to risk management and compliance within a system in which the state serves as a gatekeeper but hardly the driving force of the specifics of compliance.  These are hardly criticisms as much as they are observations about the consequences of developing hybrid systems within the traditional structures of state governance.  The effect is to contribute, as well, to the hybridization of the state. In any case, efforts like this ought to be encouraged, and studied.  One hopes that the Brazilian state will conduct this program with a high degree of transparency, and that they devote some effort to capacity building and technical assistance--both within the state and among enterprises. 

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DIRETRIZES NACIONAIS SOBRE EMPRESAS E DIREITOS HUMANOS
 Leticia Sarto for Marquez Filho Advogados

O Ministério dos Direitos Humanos (MDH), por meio da Secretaria Nacional de Cidadania (SNC), vem enfatizando, constantemente, a importância da temática “Empresas e Direitos Humanos”, empenhando-se em comunicá-lo a múltiplos atores, sensibilizar parceiros e buscar convergências para ampliar o entendimento das empresas como agentes na promoção e defesa de direitos [1].

Para tanto, em 21/11/2018, foi publicado o Decreto nº 9.571, que estabelece as Diretrizes Nacionais sobre Empresas e Direitos Humanos para médias e grandes empresas, incluídas as empresas multinacionais com atividades no país [2].

A adesão às diretrizes é voluntária, todavia, as empresas que as implementarem poderão ganhar o selo “Empresa e Direito Humanos” por meio de ato do Ministro de Estado dos Direitos Humanos, gerando valor e reconhecimento para o seu negócio.

As microempresas e empresas de pequeno porte poderão, na medida de suas capacidades, cumprir as Diretrizes de que trata o Decreto, observando o disposto na Lei Complementar nº 123/2006 e no artigo 179 da Constituição Federal.

O Decreto está disposto de acordo com os eixos orientadores das Diretrizes, quais sejam: (a) a obrigação do Estado com a proteção dos direitos humanos em atividades empresariais; (b) a responsabilidade das empresas com o respeito aos direitos; (c) o acesso aos mecanismos de reparação e remediação para aqueles que, nesse âmbito, tenham seus direitos afetados; e (d) a implementação, o monitoramento e a avaliação das Diretrizes.

No Capítulo III do Decreto, são descritas as medidas que tratam “da responsabilidade das empresas com o respeito aos direitos humanos”, como exemplo, “utilizar mecanismos de educação, de conscientização e de treinamento, tais como cursos, palestras e avaliações de aprendizagem, para que seus dirigentes, empregados, colaboradores, distribuidores, parceiros comerciais e terceiros conheçam os valores, as normas e as políticas da empresa e conheçam seu papel para o sucesso dos programas” (artigo 5º, IV) e “garantir, sempre que possível a participação das partes interessadas, sobretudo dos indivíduos e das comunidades potencialmente atingidas pelas atividades, no processo de diligência, desde a avaliação de impactos até a prestação de contas das medidas que são adotadas, incluído o processo decisório sobre quais são essas medidas e como elas serão executadas” (artigo 9º, VII).

O MDH instituirá o Comitê de Acompanhamento e Monitoramento das Diretrizes Nacionais sobre Empresas e Direitos Humanos, com as atribuições de implementar, monitorar e avaliar a execução e o cumprimento do disposto neste Decreto.

Para leitura do Decreto na íntegra, clique aqui.

Outro documento acerca da temática, recentemente publicado (20/11/2018), foi a Portaria nº 350, cuja finalidade é a de esclarecer o que o MDH considera conduta mínima ética, sustentável e respeitosa aos Direitos Humanos esperada de todas as empresas com as quais faz parcerias e contratos. Para fornecedores de bens e de serviços do MDH, a conduta é: proteger, respeitar e reparar – pilares fundamentais dos Princípios Orientadores sobre Empresas e Direitos Humanos da Organização das Nações Unidas (ONU), que inspiraram o documento [1].

Para leitura da Portaria na íntegra, clique aqui.

Além destes documentos, a temática, no âmbito nacional, está presente no Programa Nacional de Direitos Humanos (PNDH-3), instituído pelo Decreto n. 7.037, de 21/12/2009 e atualizado pelo Decreto n. 7.177, de 12/05/2010.

Já no âmbito internacional, destaca-se os Princípios Orientadores sobre Empresas e Direitos Humanos da Organização das Nações Unidas; as Diretrizes para Multinacionais da Organização para a Cooperação e Desenvolvimento Econômico – OCDE; as Convenções da Organização Internacional do Trabalho – OIT; e os Objetivos de Desenvolvimento Sustentável, da Agenda 2030 para Desenvolvimento Sustentável da Organização das Nações Unidas [3].

QUAL A IMPORTÂNCIA DE SE IMPLEMENTAR TAIS DIRETRIZES NAS EMPRESAS?

Atualmente, a sociedade está cada vez mais consciente e exigente em seus processos de decisão, escolhendo produtos e empresas que abordem suas necessidades de justiça social, econômica e ambiental. Em muitas empresas, essa abordagem mais social está intimamente ligada à implantação de políticas e medidas voltadas para a efetivação dos direitos humanos [4].

Ao implantar tais políticas, além de uma boa gestão, a empresa se coloca a serviço do bem comum, suprindo as falhas de funcionamento do mercado e os anseios dessa clientela ávida pela efetivação de seus valores sociais [4].

A abordagem da temática de direitos humanos pode ser vista como um instrumento de ampliação e de gestão da competitividade da empresa, ajudando a tornar sua imagem, sua marca e seu produto perante seus stakeholders (partes interessadas, como exemplo, a comunidade). Complementarmente, significa uma forma de exercício da ética e da cidadania por parte das empresas [4].

Vale frisar que o valor social em uma empresa pode ser importantíssimo no jogo do mercado. Isso porque se a empresa conseguir reduzir seus custos, melhorar significativamente sua imagem, aumentar sua produtividade, agregar valor a seus produtos e marca, ou seja, auferir benefícios para sua reputação, possivelmente haverá um aumento em sua clientela [4].

Os impactos da implantação de diretrizes de direitos humanos expressam-se nas seguintes áreas: “gestão de negócios, códigos de conduta, sistema de gestão, engajamento dos stakeholders nas atividades realizadas pela empresa, ações de cidadania, estímulo à formação de voluntariado dentro e fora das empresas e programas e projetos sociais, como também, responsabilidade com investimentos e responsabilidade com consumo” [5].

Portanto, ao implantar uma política voltada para os direitos humanos, a empresa poderá se beneficiar com o aumento da produtividade, maior retenção de funcionários, diferenciação da marca, acesso a novos clientes e mercados, riscos legais, reputacionais e financeiros menores e maior estabilidade e contribuição para o desenvolvimento local.


Fontes:

[1] http://www.mdh.gov.br/todas-as-noticias/2018/novembro/mdh-aprimora-instrumentos-para-reforcar-agenda-empresas-e-direitos-humanos
[2] http://www.planalto.gov.br/ccivil_03/_Ato2015-2018/2018/Decreto/D9571.htm
[3] http://www.mdh.gov.br/navegue-por-temas/empresas-e-direito-humanos
[4] https://www.aedb.br/seget/arquivos/artigos12/55616830.pdf
[5] http://www.scielo.br/pdf/rk/v15n1/a13v15n1.pdf
[6] bibliotecadigital.fgv.br/ojs/index.php/gvexecutivo/article/download/38866/37611


The Ministry of Human Rights (MDH), through the National Secretariat for Citizenship (CNS), has constantly emphasized the importance of the theme "Business and Human Rights", endeavoring to communicate it to multiple actors, raise awareness among partners and seek convergence to broaden the understanding of companies as agents in the promotion and defense of rights [1].

To this end, on November 21, 2018, Decree No. 9,571 was published, establishing the National Guidelines on Business and Human Rights for medium and large companies, including multinational companies with activities in the country.

Adherence to the guidelines is voluntary, however, companies that implement them may earn the seal "Company and Human Rights" through an act of the Minister of State for Human Rights, generating value and recognition for their business.

Micro-enterprises and small businesses may, to the extent of their abilities, comply with the Directives referred to in the Decree, observing the provisions of Complementary Law 123/2006 and Article 179 of the Federal Constitution.

The Decree is in accordance with the framework of the UN Guiding Principles for Business and Human Rights, namely: (a) the obligation of the State to protect human rights in business activities; (b) corporate responsibility for respect for rights; (c) access to remedial and remediation mechanisms for those who, in this context, have their rights affected; and (d) the implementation, monitoring and evaluation of the Guidelines.

Chapter III of the Decree describes measures that deal with "the responsibility of companies for respect for human rights", for example, "to use education, awareness and training mechanisms such as courses, lectures and appraisals of learning, so that its managers, employees, employees, distributors, commercial partners and third parties are aware of the values, norms and policies of the company and know their role for the success of the programs "(article 5, IV) and to "guarantee, whenever possible, participation of stakeholders, especially individuals and communities potentially affected by the activities, in the due diligence process, from the assessment of impacts to the accountability of the measures taken, including the decision-making process on what these measures are and how they will be implemented "(Article 9, VII).

The MDH will establish a Monitoring and Monitoring Committee of the National Directives on Business and Human Rights, with the attributions of implementing, monitoring and evaluating the execution and compliance with the provisions of this Decree.

The text of the Decree may be accessed here.

A related document, recently published (11/20/2018), was Portaria no. 350, whose purpose is to clarify what the MDH considers to be a minimum ethical, sustainable and respectful Human Rights conduct expected of all companies with the which makes partnerships and contracts. For MDH goods and services providers, the conduct is: to protect, respect and repair - fundamental pillars of the United Nations (UN) Guiding Principles on Business and Human Rights, which inspired the document [1].

The entire Ordinance may be read here.

In addition to these documents, the focus of this Decree is also reflected, at the national level, in the National Human Rights Program (PNDH-3), established by Decree no. 7,037, dated 12/21/2009 and updated by Decree no. 7.177, dated 05/12/2010.

At the international level, the United Nations Organization's Guiding Principles on Business and Human Rights stands out; the Organization for Economic Co-operation and Development (OECD) Guidelines for Multinationals; the Conventions of the International Labor Organization - ILO; and the Sustainable Development Objectives of the United Nations Development Agenda 2030 for Sustainable Development [3].

WHAT IS THE IMPORTANCE OF IMPLEMENTING THOSE GUIDELINES IN BUSINESS?

Today, society is increasingly conscious and demanding in its decision-making processes, choosing products and companies that address its needs for social, economic and environmental justice. In many companies, this more social approach is closely linked to the implementation of policies and measures aimed at the realization of human rights [4].

In implementing these policies, in addition to good management, the company places itself at the service of the common good, supplying market failures and the desires of consumers eager for the realization of their social values ​​[4].

The human rights approach can be seen as an instrument for expanding and managing the company's competitiveness, helping to augment the value of its image, its brand and its product with its stakeholders (stakeholders, including for example, the community). Complementarily, it means a form of ethics and citizenship

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Estabelece as Diretrizes Nacionais sobre Empresas e Direitos Humanos.

O PRESIDENTE DA CÂMARA DOS DEPUTADOS, no exercício do cargo de Presidente da República, no uso das atribuições que lhe confere o art. 84, caput, incisos IV e VI, alínea “a”, da Constituição,


DECRETA:


CAPÍTULO I


DISPOSIÇÕES PRELIMINARES


Art. 1º Este Decreto estabelece as Diretrizes Nacionais sobre Empresas e Direitos Humanos, para médias e grandes empresas, incluídas as empresas multinacionais com atividades no País.


§ 1º Nos termos do disposto na Lei Complementar nº 123, de 14 de dezembro de 2006, as microempresas e as empresas de pequeno porte poderão, na medida de suas capacidades, cumprir as Diretrizes de que trata este Decreto, observado o disposto no art. 179 da Constituição.

§ 2º As Diretrizes serão implementadas voluntariamente pelas empresas.

§ 3º Ato do Ministro de Estado dos Direitos Humanos instituirá o Selo “Empresa e Direitos Humanos”, destinado às empresas que voluntariamente implementarem as Diretrizes de que trata este Decreto.


Art. 2º São eixos orientadores das Diretrizes Nacionais sobre Empresas e Direitos Humanos:


I - a obrigação do Estado com a proteção dos direitos humanos em atividades empresariais;

II - a responsabilidade das empresas com o respeito aos direitos humanos;

III - o acesso aos mecanismos de reparação e remediação para aqueles que, nesse âmbito, tenham seus direitos afetados; e

IV - a implementação, o monitoramento e a avaliação das Diretrizes.


CAPÍTULO II

DA OBRIGAÇÃO DO ESTADO COM A PROTEÇÃO DOS DIREITOS HUMANOS EM ATIVIDADES EMPRESARIAIS


Art. 3º A responsabilidade do Estado com a proteção dos direitos humanos em atividades empresariais será pautada pelas seguintes diretrizes:

I - capacitação de servidores públicos sobre a temática de direitos humanos e empresas, com foco nas responsabilidades da administração pública e das empresas, de acordo com os Princípios Orientadores sobre Empresas e Direitos Humanos da Organização das Nações Unidas, principalmente ações de:
a) sensibilização e promoção da educação contínua dos recursos humanos da administração pública para o fortalecimento da cultura em direitos humanos; e

b) capacitação dos recursos humanos da administração pública para o tratamento das violações aos direitos humanos em contexto empresarial, de seus riscos e de seus impactos;
II - fortalecimento da consonância entre políticas públicas e proteção dos direitos humanos;

III - aperfeiçoamento dos mecanismos de transparência e de participação social;

IV - implementação de políticas, normas e incentivos à conduta das empresas quanto aos direitos humanos, por meio de:
a) exigência de compromisso público de respeito aos direitos humanos e publicação de relatório anual das empresas;

b) estímulo à prestação de contas sobre os riscos de sua operação aos direitos humanos e exigência de adoção de medidas de prevenção, controle e reparação; e

c) estímulo ao estabelecimento de canais de denúncia para os colaboradores, os fornecedores e a comunidade;

V - prioridade de setores com alto potencial de impacto em direitos humanos, tais como os setores extrativo, de varejo e bens de consumo, de infraestrutura, químico e farmacêutico, entre outros;


VI - desenvolvimento de políticas públicas e realização de alterações no ordenamento jurídico, a fim de:

a) considerar, além dos impactos diretamente gerados pela empresa, os impactos indiretamente gerados pela cadeia de fornecimento;

b) estimular a criação de medidas adicionais de proteção e a elaboração de matriz de priorização de reparações e indenizações para grupos em situação de vulnerabilidade;


VII - estímulo à adoção, por grandes empresas, de procedimentos adequados de dever de vigilância (due diligence) em direitos humanos;


VIII - orientação da incorporação dos direitos humanos à gestão de riscos de negócios e de parcerias que venha a estabelecer, de modo a subsidiar processos decisórios;


IX - criação de plataformas e fortalecimento de mecanismos de diálogo entre a administração pública, as empresas e a sociedade civil;


X - integração dos direitos humanos ao investimento social, aos projetos de desenvolvimento sustentável para as comunidades impactadas e às políticas de patrocínio;


XI - garantia de condições de trabalho dignas para seus recursos humanos, por meio de ambiente produtivo, com remuneração adequada e em condições de liberdade, equidade e segurança, com estímulo à observância desse objetivo pelas empresas;


XII - combate à discriminação nas relações de trabalho e promoção da valorização da diversidade;


XIII - promoção e apoio às medidas de inclusão e de não discriminação, com criação de programas de incentivos para contratação de grupos vulneráveis;


XIV - estímulo à negociação permanente sobre as condições de trabalho e a resolução de conflitos, a fim de evitar litígios;


XV - aperfeiçoamento dos programas e das políticas públicas de combate ao trabalho infantil e ao trabalho análogo à escravidão;


XVI - estímulo à adoção de códigos de condutas em direitos humanos pelas empresas com as quais estabeleça negócios ou atue em parceria, com estímulo do respeito aos direitos humanos nas relações comerciais e de investimentos estatais;


XVII - garantia de posição de negociação equilibrada com a empresa para os grupos em situação de vulnerabilidade, com garantia de suporte técnico e, sempre que possível, apoio da Defensoria Pública do Distrito Federal, dos Estados e da União;


XVIII - priorização de medidas para grupos em situação de vulnerabilidade e situações severas;


XIX - estímulo à criação de comitês permanentes para combate a desastres em contextos empresariais, o qual regulamentará questões sobre:
a) protocolo de emergência e sistemas de alerta;

b) monitoramento de riscos;

c) parâmetros para a resposta e critérios para a reparação de danos, considerado o processo de consulta como condição para a legitimidade da solução; e

XX - monitoramento da recuperação do território impactado por desastre a partir de indicadores capazes de aferir a reparação dos danos nos direitos humanos.


Parágrafo único. As denúncias de que trata a alínea “d” do inciso IV do caput serão tratadas por meio de fluxo de atendimento e de resposta públicos e no prazo estabelecido.


CAPÍTULO III

DA RESPONSABILIDADE DAS EMPRESAS COM O RESPEITO AOS DIREITOS HUMANOS


Art. 4º Caberá às empresas o respeito:

I - aos direitos humanos protegidos nos tratados internacionais dos quais o seu Estado de incorporação ou de controle sejam signatários; e

II - aos direitos e às garantias fundamentais previstos na Constituição.


Art. 5º Caberá, ainda, às empresas:

I - monitorar o respeito aos direitos humanos na cadeia produtiva vinculada à empresa;

II - divulgar internamente os instrumentos internacionais de responsabilidade social e de direitos humanos, tais como:
a) os Princípios Orientadores sobre Empresas e Direitos Humanos da Organização das Nações Unidas;

b) as Diretrizes para Multinacionais da Organização para a Cooperação e Desenvolvimento Econômico; e

c) as Convenções da Organização Internacional do Trabalho;

III - implementar atividades educativas em direitos humanos para seus recursos humanos e seus colaboradores, com disseminação da legislação nacional e dos parâmetros internacionais, com foco nas normas relevantes para a prática dos indivíduos e os riscos para os direitos humanos;

IV - utilizar mecanismos de educação, de conscientização e de treinamento, tais como cursos, palestras e avaliações de aprendizagem, para que seus dirigentes, empregados, colaboradores, distribuidores, parceiros comerciais e terceiros conheçam os valores, as normas e as políticas da empresa e conheçam seu papel para o sucesso dos programas; e

V - redigir código de conduta publicamente acessível, aprovado pela alta administração da empresa, que conterá os seus engajamentos e as suas políticas de implementação dos direitos humanos na atividade empresarial.


Art. 6º É responsabilidade das empresas não violar os direitos de sua força de trabalho, de seus clientes e das comunidades, mediante o controle de riscos e o dever de enfrentar os impactos adversos em direitos humanos com os quais tenham algum envolvimento e, principalmente:


I - agir de forma cautelosa e preventiva, nos seus ramos de atuação, inclusive em relação às atividades de suas subsidiárias, de entidades sob seu controle direito ou indireto, a fim de não infringir os direitos humanos de seus funcionários, colaboradores, terceiros, clientes, comunidade onde atuam e população em geral;

II - evitar que suas atividades causem, contribuam ou estejam diretamente relacionadas aos impactos negativos sobre direitos humanos e aos danos ambientais e sociais,

III - evitar impactos e danos decorrentes das atividades de suas subsidiárias e de entidades sob seu controle ou vinculação direta ou indireta;

IV - adotar compromisso de respeito aos direitos humanos, aprovado pela alta administração da empresa, no qual trará as ações que realizará, para evitar qualquer grau de envolvimento com danos, para controlar e monitorar riscos a direitos humanos, assim como as expectativas da empresa em relação aos seus parceiros comerciais e funcionários;

V - garantir que suas políticas, seus códigos de ética e conduta e seus procedimentos operacionais reflitam o compromisso com o respeito aos direitos humanos;

VI - implementar o compromisso político assumido nas áreas da empresa, publicá-lo e mantê-lo atualizado, com destaque, nos sítios eletrônicos e nos canais públicos da empresa e constituir área ou pessoa responsável para acompanhar o seu cumprimento;

VII - promover a consulta livre, prévia e informada das comunidades impactadas pela atividade empresarial;

VIII - criar políticas e incentivos para que seus parceiros comerciais respeitem os direitos humanos, tais como a adoção de critérios e de padrões sociais e ambientais internacionalmente reconhecidos para a seleção e a execução de contratos com terceiros, correspondentes ao tamanho da empresa, à complexidade das operações e aos riscos aos direitos humanos;

IX - comunicar internamente que seus colaboradores estão proibidos de adotarem práticas que violem os direitos humanos, sob pena de sanções internas;

X - orientar os colaboradores, os empregados e as pessoas vinculadas à sociedade empresária a adotarem postura respeitosa, amistosa e em observância aos direitos humanos;

XI - estimular entre fornecedores e terceiros um convívio inclusivo e favorável à diversidade;

XII - dispor de estrutura de governança para assegurar a implementação efetiva dos compromissos e das políticas relativas aos direitos humanos;


XIII - incorporar os direitos humanos na gestão corporativa de risco a fim de subsidiar processos decisórios;

XIV - adotar indicadores específicos para monitorar suas ações em relação aos direitos humanos; e

XV - adotar iniciativas públicas e acessíveis de transparência e divulgação das políticas, do código de conduta e dos mecanismos de governança.


Art. 7º Compete às empresas garantir condições decentes de trabalho, por meio de ambiente produtivo, com remuneração adequada, em condições de liberdade, equidade e segurança, com iniciativas para:

I - manter ambientes e locais de trabalho acessíveis às pessoas com deficiência, mesmo em áreas ou atividades onde não há atendimento ao público, a fim de que tais pessoas encontrem, no ambiente de trabalho, as condições de acessibilidade necessárias ao desenvolvimento pleno de suas atividades;

II - observar os direitos de seus colaboradores de:
a) se associar livremente;

b) afiliar-se a sindicatos de trabalhadores;

c) participar dos conselhos de trabalho;

d) envolver-se em negociações coletivas;

e) receber os benefícios previstos em lei, incluídos os repousos legais; e

f) não exceder a jornada de trabalho legal;

III - manter compromisso com as políticas de erradicação do trabalho análogo à escravidão e garantir ambiente de trabalho saudável e seguro;

IV - não manter relações comerciais ou relações de investimentos, seja de subcontratação, seja de aquisição de bens e serviços, com empresas ou pessoas que violem os direitos humanos;

V - respeitar os direitos de crianças e adolescentes, de forma a incluir, em seus planos de trabalho, assim como exigir de seus fornecedores, empresas coligadas, controladas, subsidiárias e parceiras, ações preventivas e reparatórias para evitar riscos, impactos e violações a direitos de crianças e adolescentes, especialmente as de enfrentamento, erradicação do trabalho infantil e exploração sexual de crianças e adolescentes;

VI - avaliar e monitorar os contratos firmados com seus fornecedores de bens e serviços, parceiros e clientes que contenham cláusulas de direitos humanos que impeçam o trabalho infantil ou o trabalho análogo à escravidão;

VII - adotar medidas de prevenção e precaução, para evitar ou minimizar os impactos adversos que as suas atividades podem causar direta ou indiretamente sobre os direitos humanos, a saúde e a segurança de seus empregados; e

VIII - assegurar a aplicação vertical de medidas de prevenção a violações de direitos humanos.


§ 1º A inexistência de certeza científica absoluta não será invocada como argumento para adiar a adoção de medidas para evitar violações aos direitos humanos, à saúde e à segurança dos empregados.


§ 2º As medidas de prevenção e precaução a violações aos direitos humanos serão adotadas em toda a cadeia de produção dos grupos empresariais.


Art. 8º Caberá às empresas combater a discriminação nas relações de trabalho e promover a valorização e o respeito da diversidade em suas áreas e hierarquias, com ênfase em:

I - resguardar a igualdade de salários e de benefícios para cargos e funções com atribuições semelhantes, independentemente de critério de gênero, orientação sexual, étnico-racial, de origem, geracional, religiosa, de aparência física e de deficiência;

II - adotar políticas de metas percentuais crescentes de preenchimento de vagas e de promoção hierárquica para essas pessoas, contempladas a diversidade e a pluralidade, ainda que para o preenchimento dessas vagas seja necessário proporcionar cursos e treinamentos específicos;

III - promover o acesso da juventude à formação para o trabalho em condições adequadas;

IV - respeitar e promover os direitos das pessoas idosas e promover a sua empregabilidade;

V - respeitar e promover os direitos das pessoas com deficiência e garantir a acessibilidade igualitária, a ascensão hierárquica, a sua empregabilidade e a realização da política de cotas;

VI - respeitar e promover o direito de grupos populacionais que tiveram dificuldades de acesso ao emprego em função de práticas discriminatórias;

VII - respeitar e promover os direitos das mulheres para sua plena cidadania, empregabilidade e ascensão hierárquica,

VIII - buscar a erradicação de todas as formas de desigualdade e discriminação;

IX - respeitar a livre orientação sexual, a identidade de gênero e a igualdade de direitos da população de lésbicas, gays, bissexuais, travestis, transexuais ou transgêneros em âmbito empresarial; e

X - efetivar os direitos sociais, econômicos e culturais das comunidades locais e dos povos tradicionais, respeitadas a sua identidade social e cultural e a sua fonte de subsistência e promover consulta prévia e diálogo constante com a comunidade.

Art. 9º Compete às empresas identificar os riscos de impacto e a violação a direitos humanos no contexto de suas operações, com a adoção de ações de prevenção e de controle adequadas e efetivas e, principalmente:

I - realizar periodicamente procedimentos efetivos de reavaliação em matéria de direitos humanos, para identificar, prevenir, mitigar e prestar contas do risco, do impacto e da violação decorrentes de suas atividades, de suas operações e de suas relações comerciais;

II - desenvolver e aperfeiçoar permanentemente os procedimentos de controle e monitoramento de riscos, impactos e violações e reparar as consequências negativas sobre os direitos humanos que provoquem ou tenham contribuído para provocar;

III - adotar procedimentos para avaliar o respeito aos direitos humanos na cadeia produtiva;

IV - prestar contas com clareza, transparência e lealdade sobre os riscos da operação nos direitos humanos e as medidas adotadas para preveni-los, além dos impactos negativos e dos danos aos direitos humanos que tenham sido causados ou que tenham relação direta com suas operações, seus produtos ou os serviços prestados por meio de suas relações comerciais e das ações de reparação adotadas;

V - informar publicamente as medidas que adotaram no último ciclo para evitar riscos, mitigar impactos negativos aos direitos humanos e prevenir violações, com base em compromisso assumido pela empresa, consideradas as características do negócio e dos territórios impactados por suas operações;

VI - divulgar e identificar publicamente aos seus fornecedores as normas de direitos humanos às quais estejam sujeitos, de modo a possibilitar o controle por parte dos trabalhadores e da sociedade civil, ressalvado o sigilo comercial; e

VII - garantir, sempre que possível a participação das partes interessadas, sobretudo dos indivíduos e das comunidades potencialmente atingidas pelas atividades, no processo de diligência, desde a avaliação de impactos até a prestação de contas das medidas que são adotadas, incluído o processo decisório sobre quais são essas medidas e como elas serão executadas.


Parágrafo único. As empresas que possuírem numerosas entidades em sua esfera de influência, que dificultem a auditoria no âmbito de cada entidade, priorizarão as áreas identificadas como mais sujeitas a riscos de consequências negativas sobre os direitos humanos.


Art. 10. É responsabilidade das empresas estabelecer mecanismos operacionais de denúncia e de reclamação que permitam identificar os riscos e os impactos e reparar as violações, quando couber, em especial:

I - instituir mecanismos de denúncia, apuração e medidas corretivas, assegurados o sigilo e o anonimato aos denunciantes de boa-fé, de modo que tais instrumentos estejam acessíveis a colaboradores, fornecedores, parceiros e comunidade de entorno e sejam transparentes, imparciais e aptos a tratar de questões que envolvam ameaças aos direitos humanos, além de terem fluxos e prazos para a resposta previamente estabelecidos e amplamente divulgados;

II - implementar sistema de gerenciamento de riscos de abusos de direitos humanos, incluídos o gerenciamento de riscos sobre a saúde e a segurança dos empregados, com a identificação dos impactos negativos sobre os direitos humanos, direta ou indiretamente relacionados com a sua atividade;

III - adotar política de comunicação, fiscalização e sanção direcionada aos seus colaboradores e buscar a promoção do respeito aos direitos humanos e à prevenção de riscos e violações;

IV - divulgar os canais internos de denúncia e os canais públicos de denúncias de ofensas a direitos humanos, tais como o Disque 100 e a Central de Atendimento à Mulher - Ligue 180, entre outros;

V - adequar a empresa e suas coligadas, controladas, suas subsidiárias, suas parceiras e seus fornecedores às exigências e às proibições legais em relação ao combate à corrupção, aos comportamentos antiéticos e ao assédio moral, dentre outros;

VI - fomentar cultura de ética e de respeito às leis, notadamente aquelas que dizem respeito à lisura do processo de contratação pública, por meio de declarações documentadas da alta administração da empresa aos seus empregados, colaboradores e parceiros e esclarecer os padrões éticos da empresa;

VII - criar e manter:
a) programa de integridade na empresa; e

b) instância responsável pelo programa de integridade a que se refere a alíne “a”, dotada de autonomia, imparcialidade, recursos materiais, humanos e financeiros, com possibilidade de acesso direto ao maior nível decisório da empresa e com a atribuição de rever o programa periodicamente;

VIII - estabelecer procedimentos de controle interno e de verificação de aplicabilidade do programa de integridade, inclusive com a apresentação de relatórios frequentes e a publicação de demonstrações financeiras;

IX - instituir processos internos que permitam investigações para atender prontamente às denúncias de comportamentos antiéticos, de forma a garantir que os fatos sejam identificados e averiguados com credibilidade, de forma rigorosa, independente e analítica e que os culpados sejam devidamente responsabilizados, admitidas a advertência e a demissão; e

X - publicar anualmente as ações realizadas para promoção da integridade e controle de corrupção.


Art. 11. É responsabilidade das empresas adotar medidas de garantia de transparência ativa, com divulgação de informações relevantes, de documentos acessíveis às partes interessadas, quanto aos mecanismos de proteção de direitos humanos e de prevenção e de reparação de violações de direitos humanos na cadeia produtiva, com ênfase para:


I - divulgação suplementar periódicas de informações, por meio de informativos anuais que destaquem as ações empresariais realizadas, especialmente quanto:
a) ao sistema de auditoria interna;

b) ao sistema de gestão de risco; e

c) ao cumprimento das normas de proteção de direitos humanos, das normas de prevenção e reparação de possíveis violações de direitos humanos;
II - conscientização dos funcionários acerca das políticas empresariais, por meio de divulgação adequada de informação e de programas de formação contínua, de modo a garantir o acesso à informação e promover a atuação completa no processo produtivo e sem falhas, que resulte em violações aos direitos humanos; e

III - quando solicitado, fornecimento aos consumidores, por meio de acesso rápido e eficaz, sem custos ou encargos desnecessários, de informações referentes à compatibilidade das atividades empresariais, do processo de produção ou do fornecimento de serviços com os direitos humanos.

Art. 12. Compete às empresas adotar iniciativas para a sustentabilidade ambiental, tais como:

I - ter conhecimento dos aspectos e dos impactos ambientais causados por suas atividades, seus produtos e seus serviços;

II - desenvolver programas com objetivos, metas e ações de controle necessárias, vinculadas aos Objetivos do Desenvolvimento Sustentável da Organização das Nações Unidas, suficientes para evitar danos e causar menor impacto sobre recursos naturais como flora, fauna, ar, solo, água e utilizar, de forma sustentável, os recursos materiais;

III - divulgar as informações de que trata o inciso I do caput de forma transparente, especialmente para grupos diretamente impactados;

IV - utilizar bens e serviços que não gerem resíduos, poluição ou contaminação ou que gerem a menor quantidade de resíduos e efluentes possível;

V - estabelecer programa de gestão de resíduos sólidos que seja socialmente inclusivo e participativo, que vise a não geração, à redução, à reutilização, à reciclagem, ao tratamento e à disposição final;

VI - considerar a substituição de materiais que resultem em resíduos mais agressivos por materiais ambientalmente mais adequados;

VII - adotar medidas para conferir mais eficiência às operações, a fim de reduzir emissões de gases de efeito estufa, de modo a contribuir com o combate às mudanças climáticas;

VIII - priorizar fontes de energia limpa e controlar e reduzir o consumo de energia elétrica;

IX - priorizar materiais, tecnologias e matérias-primas biossustentáveis de origem local;

X - utilizar produtos recicláveis ou que tenham maior vida útil e menor custo de manutenção do bem ou da obra;

XI - respeitar as singularidades de cada território e o aproveitamento sustentável das potencialidades e recursos locais e regionais; e

XII - incentivar fornecedores, trabalhadores e colaboradores a estabelecer diálogo permanente com as comunidades locais, baseados em uma agenda comum positiva, destinada ao desenvolvimento local sustentável.


CAPÍTULO IV

DO ACESSO A MECANISMOS DE REPARAÇÃO E REMEDIAÇÃO


Art. 13. O Estado manterá mecanismos de denúncia e reparação judiciais e não judiciais existentes e seus obstáculos e lacunas legais, práticos e outros que possam dificultar o acesso aos mecanismos de reparação, de modo a produzir levantamento técnico sobre mecanismos estatais de reparação das violações de direitos humanos relacionadas com empresas, como:

I - elaborar, junto ao Poder Judiciário e a outros atores, levantamento dos mecanismos judiciais e não judiciais existentes e dos entraves existentes em sua realização e realizar levantamento, sistematização e análise de jurisprudência sobre o tema;

II - propor soluções concretas para tornar o sistema estatal de reparação legítimo, acessível, previsível, equitativo, transparente e participativo;

III - incentivar as empresas a desenvolverem mecanismos internos de escuta e denúncia que tenham fluxo e prazo para resposta preestabelecidos e amplamente divulgados;

IV - capacitar sobre a temática de empresas e direitos humanos, juntamente com o Poder Judiciário e os órgãos competentes, os operadores de direitos e os funcionários responsáveis por temas como direitos dos defensores, dos povos indígenas, das minorias étnicas e dos demais grupos vulneráveis, temas ambientais e licenciamento ambiental, demarcação de terras e conflitos agrários e fundiários, entre outros;

V - capacitar recursos humanos e prover assistência e informações, em linguagem clara, para as pessoas que queiram exigir seus direitos a partir do acesso e do uso de mecanismos de denúncia e reparação judiciais e extrajudiciais;

VI - dar conhecimento dos mecanismos de denúncia existentes, tais como o Disque 100, o Ligue 180 e outros, aprimorar tais mecanismos para acolhimento de denúncias relacionadas às violações de direitos humanos em contexto empresarial, que sejam encaminhadas aos órgãos competentes pela apuração e reparação, além de serem sistematizadas, para formação de banco de dados específico sobre violação aos direitos humanos por empresas, que poderá ser acessado para fins de aprimoramento de políticas destinadas à proteção dos direitos humanos;

VII - incentivar a adoção por parte das empresas e a utilização por parte das vítimas, de medidas de reparação como:
a) compensações pecuniárias e não pecuniárias;

b) desculpas públicas;

c) restituição de direitos; e

d) garantias de não repetição;

VIII - promover o desenvolvimento de mecanismos de mediação e de resolução de conflitos entre a administração pública, as comunidades, os cidadãos e as empresas e garantir a transparência, a informação e o apoio técnico necessários, a fim de reduzir a assimetria que possa existir entre a empresa e a vítima de violação ou o cidadão impactado;


IX - estimular amplamente o uso de mecanismos de mediação, de resolução ou de outros processos extrajudiciais e compatíveis com os direitos humanos;


X - aprimorar os mecanismos de fiscalização, por meio da aplicação de critérios de priorização como vulnerabilidade territorial, que abordem aspectos institucionais e geográficos, e denúncias, que considerem a quantidade de denúncias recebidas;


XI - estimular o aprimoramento de mecanismos de priorização de tramitação de processos judiciais que envolvam desastres ambientais e sociais decorrentes da atividade empresarial, em atenção às orientações e aos instrumentos do Escritório para Redução do Risco de Desastre da Organização das Nações Unidas; e


XII - fortalecer as ações de fiscalização na hipótese de infração de direitos trabalhistas e ambientais.

Art. 14. Compete à administração pública incentivar que as empresas estabeleçam ou participem de mecanismos de denúncia e reparação efetivos e eficazes, que permitam propor reclamações e reparar violações dos direitos humanos relacionadas com atividades empresariais, com ênfase para:

I - disponibilizar mecanismos para o monitoramento e a solução de controvérsias de impactos e violações decorrentes de suas atividades ou suas operações, por meio de canais de denúncia à disposição das pessoas e comunidades afetadas;

II - disponibilizar canal de denúncias direto para que as pessoas e as comunidades possam expressar suas preocupações em relação ao impacto adverso dos negócios em seus direitos;

III - facilitar o pedido de informações e o acesso por parte das comunidades atingidas e do entorno e:
a) comprometer-se com o combate aos entraves para produção de provas por parte das vítimas e dos atingidos e contribuir com as investigações;

b) dar clareza e visibilidade à sua estrutura interna e à estrutura do grupo econômico do qual faça parte; e

c) adotar compromissos públicos de não retaliação de comunidades e de pessoas que denunciem violações ou risco de violações de direitos humanos relacionadas com a empresa, considerada a sua dependência econômica;
IV - reparar, de modo integral, as pessoas e as comunidades atingidas.


Art. 15. A reparação integral de que trata o inciso IV do caput do art. 14 poderá incluir as seguintes medidas, exemplificativas e passíveis de aplicação, que poderão ser cumulativas:

I - pedido público de desculpas;

II - restituição;

III - reabilitação;

IV - compensações econômicas ou não econômicas;

V - sanções punitivas, como multas, sanções penais ou sanções administrativas; e

VI - medidas de prevenção de novos danos como liminares ou garantias de não repetição.


Parágrafo único. Os procedimentos de reparação serão claros e transparentes em suas etapas, amplamente divulgados para todas as partes interessadas, com garantia da imparcialidade, da equidade de tratamento entre os indivíduos e serem passíveis de monitoramento de sua efetividade a partir de indicadores quantitativos e qualitativos de direitos humanos.


CAPÍTULO V

DA IMPLEMENTAÇÃO, DO MONITORAMENTO E DA AVALIAÇÃO DAS DIRETRIZES NACIONAIS SOBRE EMPRESAS E DIREITOS HUMANOS


Art. 16. O Ministério dos Direitos Humanos instituirá o Comitê de Acompanhamento e Monitoramento das Diretrizes Nacionais sobre Empresas e Direitos Humanos, com as atribuições de implementar, monitorar e avaliar a execução e o cumprimento do disposto neste Decreto.


Art. 17. Caberá ao Comitê de Acompanhamento e Monitoramento das Diretrizes Nacionais sobre Empresas e Direitos Humanos:

I - elaborar plano de ação anual, com vistas a concretizar as Diretrizes, que será editado em ato do Ministro de Estado dos Direitos Humanos;


II - elaborar estudos com a participação da sociedade civil, das instituições acadêmicas e de outros atores, com vistas ao aprimoramento das políticas públicas e da legislação e à adoção de planos destinados à proteção e à promoção do respeito aos direitos humanos pelas empresas;


III - conduzir os processos de consulta pública para aprimoramento das Diretrizes e formalização dos planos de trabalho;


IV - propor ações referenciais em direitos humanos para subsidiar a atuação das empresas estatais e privadas;


V - promover a articulação entre os órgãos e as entidades da administração pública, o setor privado, as instituições acadêmicas e as organizações da sociedade civil para a implementação das Diretrizes;


VI - propor ao Ministro de Estado dos Direitos Humanos as regulamentações necessárias à execução do disposto nas Diretrizes;


VII - estabelecer indicadores quantitativos e qualitativos para o acompanhamento, o monitoramento e a avaliação periódicos das Diretrizes; e


VIII - receber reclamações, denúncias e propostas da sociedade civil.


§ 1º O Comitê de Acompanhamento e Monitoramento das Diretrizes Nacionais sobre Empresas e Direitos Humanos será integrado por um representante, titular e suplente, dos seguintes órgãos:

I - Ministério dos Direitos Humanos, que o coordenará;

II - Casa Civil da Presidência da República;

III - Ministério da Justiça;

IV - Ministério das Relações Exteriores;

V - Ministério do Trabalho;

VI - Ministério da Indústria, Comércio Exterior e Serviços;

VII - Ministério de Minas e Energia;

VIII - Ministério da Ciência, Tecnologia, Inovação e Comunicações; e

IX - Ministério do Meio Ambiente.


§ 2º O Comitê de Acompanhamento e Monitoramento das Diretrizes Nacionais sobre Empresas e Direitos Humanos será integrado por nove representantes da sociedade civil, paritariamente divididos entre os seguintes setores:

I - terceiro setor;

II - instituições acadêmicas; e

III - setor privado e sindicatos.


§ 3º O Comitê de Acompanhamento e Monitoramento das Diretrizes Nacionais sobre Empresas e Direitos Humanos poderá convidar representantes dos Poderes, dos entes federativos, da sociedade civil e de organizações internacionais e especialistas para participar de suas reuniões.


§ 4º Os representantes de que trata o § 1º serão indicados pelo titular do respectivo órgão e designados em ato do Ministro de Estado dos Direitos Humanos.


§ 5º A participação no Comitê de Acompanhamento e Monitoramento das Diretrizes Nacionais sobre Empresas e Direitos Humanos será considerada prestação de serviço público relevante, não remunerada.


§ 6º O Comitê de Acompanhamento e Monitoramento das Diretrizes Nacionais sobre Empresas e Direitos Humanos se reunirá, em caráter ordinário, semestralmente ou, em caráter extraordinário, por convocação de seu Coordenador ou por solicitação da maioria de seus membros.


§ 7º O quórum para reunião do Comitê será a presença da maioria de seus representantes e o quórum para deliberação será a maioria simples.


§ 8º O Comitê de Acompanhamento e Monitoramento das Diretrizes Nacionais sobre Empresas e Direitos Humanos elaborará e aprovará seu regimento interno para dispor sobre sua organização e seu funcionamento.


§ 9º O Ministério dos Direitos Humanos prestará o apoio técnico e administrativo necessário para o funcionamento do Comitê de Acompanhamento e Monitoramento das Diretrizes Nacionais sobre Empresas e Direitos Humanos.


§ 10. O representante que se encontre em localidade distinta da sede do Comitê de Acompanhamento e Monitoramento das Diretrizes Nacionais sobre Empresas e Direitos Humanos participará da reunião preferencialmente por meio virtual ou arcará com os custos de seu deslocamento.


Art. 18. Ato do Ministro de Estado dos Direitos Humanos disporá sobre as regras e os procedimentos de seleção das entidades que representaram a sociedade civil no Comitê de Acompanhamento e Monitoramento das Diretrizes Nacionais sobre Empresas e Direitos Humanos, observado o disposto no § 2º do art. 17.


CAPÍTULO VI

DISPOSIÇÕES FINAIS


Art. 19. Este Decreto entra em vigor na data de sua publicação.


Brasília, 21 de novembro de 2018; 197º da Independência e 130º da República.


RODRIGO MAIA
Gustavo do Vale Rocha


Este texto não substitui o publicado no DOU de 22.11.2018

Presidência da República
Casa Civil
Subchefia para Assuntos Jurídicos

A Tale of Two Speeches--Evidence From the Front Lines of Political Rupture

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(Pix credit HERE)

 The current state of politics in the United States is well known. I have little to say about the substance of what marks the current fault lines of American politics that has not already been analyzed from many perspectives and ideological baselines.  Those fault lines are much in evidence in the current political divisions around immigration.  Mr. Trump has sought several billion dollars to fund a wall of some sort on the U.S.-Mexico border; his political opponents have sought to block this request.  Broader political issues, along with control of the narrative of American politics are at stake, of course, but this is merely one eruption in that longer term battle among those who drive these things.

On the other hand, the current state of discursive aspects of political communication merits far more attention. A careful consideration of the way on which figures "talk" to each other as they appeal to the masses through driving social media institutions, the federal government has effectively been shut down for lack of funding, provides insights about the way that discourse itself substantially shapes and limits the ability of people to respond in negotiation. The power of discursive tropes to hobble political discourse, especially in crisis, was much in evidence in the context of the current impasse over the border wall and the government shutdown ('I said bye-bye!' Trump storms out of Situation Room talks with Chuck and Nancy when she says he WON'T get money for his border wall even if he ends government shutdown – then tweets that it was 'a total waste of time').

The most remarkable thing about the discursive style of all speakers is the reduction of discourse to sound byte.  A careful reading of the three statements that follow below reveal an almost ritualistic pattern. Each speech can be reduced to several key phrases around which almost verbal "white noise" is inserted. In a lot of ways the discursive styles of the speeches read more like short commercials--each share the character of producing words and images that are meant to lead up to the key slogan that sums everything up.  But interestingly, shorn of their context, it is not always clear who is saying which:
"This is a humanitarian crisis, a crisis of the heart and a crisis of the soul;""The President has chosen fear. We want to start with the facts;""I would ask, imagine if it was your child, your husband or your wife whose life was so cruelly shattered and totally broken;"  "This is a choice between right and wrong, justice and injustice;""Division, not unity. Make no mistake;""The symbol of America should be the Statue of Liberty, not a thirty-foot wall;""The only thing that is immoral is for the politicians to do nothing and continue to allow more innocent people to be so horribly victimized."  
And it is those slogans rather than the words that populate the rest of the respective addresses that then drive the interactions among actors.  

To get a better sense of the way that discourse now constrains and shapes the wiggle room of political discussion, I have included below the relatively short speeches of President Trump, and the responses of Representative Pelosi and Senator Schumer.  It is worth reading these not so much for their substantive content as for the way their discursive style reveals the quite different ways in which they view a shared reality.  That style has much to say about the state of American politics in the forms of its expression at the moment. 




 

Full text: Donald Trump's immigration address

By POLITICO STAFF

01/08/2019 09:17 PM EST

President Donald Trump's address on immigration, as delivered from the Oval Office

My fellow Americans,

Tonight, I am speaking to you because there is a growing humanitarian and security crisis at our southern border. Every day customs and border patrol agents encounter thousands of illegal immigrants trying to enter our country. We are out of space to hold them and we have no way to promptly return them back home to their country. America proudly welcomes millions of lawful immigrants who enrich our society and contribute to our nation. But, all Americans are hurt by uncontrolled illegal migration. It strains public resources and drives down jobs and wages. Among those hardest hit are African-Americans and Hispanic Americans. Our southern border is a pipeline for vast quantities of illegal drugs, including meth, heroin, cocaine and fentanyl. Every week 300 of our citizens are killed by heroin alone, 90 percent of which floods across from our southern border. More Americans will die from drugs this year than were killed in the entire Vietnam War.

In the last two years, ICE officers made 266,000 arrests of aliens with criminal records including those charged or convicted of 100,000 assaults, 30,000 sex crimes, and 4,000 violent killings. Over the years thousands of Americans have been brutally killed by those who illegally entered our country and thousands more lives will be lost if we don't act right now. This is a humanitarian crisis, a crisis of the heart and a crisis of the soul.

Last month, 20,000 migrant children were illegally brought into the united States, a dramatic increase. These children are used as human pawns by vicious coyotes and ruthless gangs. One in three women are sexually assaulted on the dangerous trek up through Mexico. Women and children are the biggest victims by far of our broken system. This is the tragic reality of illegal immigration on our southern border. This is the cycle of human suffering that I am determined to end.
 
My administration has presented Congress with a detailed proposal to secure the border and stop the criminal gangs, drug smugglers and human traffickers. It's a tremendous problem. Our proposal was developed by law enforcement professionals and border agents at the department of homeland security. These are the resources they have requested to properly perform their mission and keep America safe. In fact, safer than ever before. The proposal from Homeland Security includes cutting-edge technology for detecting drugs, weapons, illegal contraband and many other things. We have requested more agents, immigration judges, and bed space to process the sharp rise in unlawful migration fueled by our very strong economy. Our plan also contains an urgent request for humanitarian assistance and medical support. Furthermore, we have asked Congress to close border security loopholes so that illegal immigrant children can be safely and humanely returned back home. Finally, as part of an overall approach to border security, law enforcement professionals have requested $5.7 billion for a physical barrier. At the request of Democrats, it will be a steel barrier rather than a concrete wall.

This barrier is absolutely critical to border security. It's also what our professionals at the border want and need. This is just common sense. The border wall would very quickly pay for itself. The cost of illegal drugs exceeds $500 billion a year. Vastly more than the $5.7 billion we have requested from Congress. The wall will always be paid for indirectly by the great new trade deal we have made with Mexico. Sen. Chuck Schumer, who you will be hearing from later tonight, has repeatedly supported a physical barrier in the past along with many other Democrats. They changed their mind only after I was elected president. Democrats in Congress have refused to acknowledge the crisis. And they have refused to provide our brave border agents with the tools they desperately need to protect our families and our nation. The federal government remains shut down for one reason and one reason only because Democrats will not fund border security. My administration is doing everything in our power to help those impacted by the situation. But the only solution is for Democrats to pass a spending bill that defends our borders and reopens the government. This situation could be solved in a 45-minute meeting. I have invited congressional leadership to the White House tomorrow to get this done. Hopefully, we can rise above partisan politics in order to support national security.

Some have suggested a barrier is immoral. Then why do wealthy politicians build walls, fences and gates around their homes? They don't build walls because they hate the people on the outside, but because they love the people on the inside. The only thing that is immoral is for the politicians to do nothing and continue to allow more innocent people to be so horribly victimized. America's heart broke the day after Christmas when a young police officer in California was savagely murdered in cold blood by an illegal alien who just came across the border. The life of an American hero was stolen by someone who had no right to be in our country.

Day after day, precious lives are cut short by those who have violated our borders. In California, an Air Force veteran was raped, murdered and beaten to death with a hammer by an illegal alien with a long criminal history. In Georgia, an illegal alien was recently charged with murder for killing, beheading and dismembering his neighbor. In Maryland, MS-13 gang members who arrived in the United States as unaccompanied minors were arrested and charged last year after viciously stabbing and beating a 16-year-old girl. Over the last several years, I have met with dozens of families whose loved ones were stolen by illegal immigration. I've held the hands of the weeping mothers and embraced the grief-stricken fathers. So sad. So terrible. I will never forget the pain in their eyes, the tremble in their voices and the sadness gripping their souls. How much more American blood must we shed before Congress does its job?

For those who refuse to compromise in the name of in the name of border security, I would ask, imagine if it was your child, your husband or your wife whose life was so cruelly shattered and totally broken. To every member of Congress, pass a bill that ends this crisis. To every citizen, call Congress and tell them to finally, after all of these decades, secure our border. This is a choice between right and wrong, justice and injustice. This is about whether we fulfill our sacred duty to the American citizens we serve. When I took the oath of office, I swore to protect our country. And that is what I will always do so help me God. Thank you and good night.


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Full text: Pelosi and Schumer respond to Trump's immigration speech

By POLITICO STAFF

01/08/2019 09:25 PM EST

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Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer's response to President Donald Trump's immigration speech, as delivered on Capitol Hill

Speaker Pelosi: Good evening.

I appreciate the opportunity to speak directly to the American people tonight about how we can end this shutdown and meet the needs of the American people. Sadly, much of what we have heard from President Trump throughout this senseless shutdown has been full of misinformation and even malice. The President has chosen fear. We want to start with the facts.

The fact is: On the very first day of this Congress, House Democrats passed Senate Republican legislation to re-open government and fund smart, effective border security solutions. But the President is rejecting these bipartisan bills which would re-open government – over his obsession with forcing American taxpayers to waste billions of dollars on an expensive and ineffective wall – a wall he always promised Mexico would pay for! The fact is: President Trump has chosen to hold hostage critical services for the health, safety and well-being of the American people and withhold the paychecks of 800,000 innocent workers across the nation – many of them veterans. He promised to keep government shutdown for ‘months or years’ – no matter whom it hurts. That’s just plain wrong.

The fact is: We all agree that we need to secure our borders, while honoring our values: we can build the infrastructure and roads at our ports of entry; we can install new technology to scan cars and trucks for drugs coming into our nation; we can hire the personnel we need to facilitate trade and immigration at the border; and we can fund more innovation to detect unauthorized crossings.

The fact is: the women and children at the border are not a security threat, they are a humanitarian challenge – a challenge that President Trump’s own cruel and counterproductive policies have only deepened. And the fact is: President Trump must stop holding the American people hostage, must stop manufacturing a crisis, and must re-open the government.

Thank you.

Senator Schumer: Thank you, Speaker Pelosi.

My fellow Americans, we address you tonight for one reason only: the President of the United States – having failed to get Mexico to pay for his ineffective, unnecessary border wall, and unable to convince the Congress or the American people to foot the bill – has shut down the government. American democracy doesn’t work that way. We don’t govern by temper tantrum. No president should pound the table and demand he gets his way or else the government shuts down, hurting millions of Americans who are treated as leverage. Tonight – and throughout this debate and his presidency – President Trump has appealed to fear, not facts. Division, not unity. Make no mistake: Democrats and the President both want stronger border security. However, we sharply disagree with the President about the most effective way to do it. So, how do we untangle this mess? There is an obvious solution: separate the shutdown from the arguments over border security. There is bipartisan legislation – supported by Democrats and Republicans – to re-open government while allowing debate over border security to continue.

There is no excuse for hurting millions of Americans over a policy difference. Federal workers are about to miss a paycheck. Some families can’t get a mortgage to buy a new home. Farmers and small businesses won’t get loans they desperately need. Most presidents have used Oval Office addresses for noble purposes. This president just used the backdrop of the Oval Office to manufacture a crisis, stoke fear, and divert attention from the turmoil in his Administration.

My fellow Americans, there is no challenge so great that our nation cannot rise to meet it. We can re-open the government and continue to work through disagreements about policy. We can secure our border without an expensive, ineffective wall. And we can welcome legal immigrants and refugees without compromising safety and security. The symbol of America should be the Statue of Liberty, not a thirty-foot wall. So our suggestion is a simple one: Mr. President: re-open the government and we can work to resolve our differences over border security. But end this shutdown now.

Thank you.

Concept Note: "Marxist-Leninism 2.0: China’s Socialist Democracy"; Event to be Held at Penn State University 12 February 2018

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These are quite dynamic times for democracy--as theory, institution, and system.  What had once been a term whose contours and applications appeared  to converge around global certainties has encountered, in this new era of national and international relations, challenges from a number of quite distinct sources.  Though much attention has been paid to the specific challenges within the structures of Western liberal democracies, Marxist Leninist political  communities have also encountered the challenges of democracy within their own political systems. 

It is with that in mind that we have organized an event  hosted at Penn State University on 12 February 2019 that may be of interest to those who study democracy in action and the theories around which those actions are grounded.   

The event, Marxist-Leninism 2.0: China's Socialist Democracy brings together scholars from Europe, the United States, and China to consider recent developments in Chinese democratic theory and practice from a national and comparative perspective. The core object of participants will be to seek to extract the fundamental theory and characteristics of the emerging systems, and to point to the likely paths to further development. 

The event Concept Note follows. Updated Event information may be accessed HERE.





Pennsylvania State University
12 February 2018
Lewis Katz Building
University Park
Sponsored by the Coalition for Peace & Ethics, the Foundation for Law and International Affairs, Penn State Law and School of International Affairs.  Funding  provided in part by the Penn State University Park Allocation Committee.

Conference Concept Note

These are turbulent times for democratic theory.  In the West, intellectuals worry about the continued viability of democratic republican systems in their current form.  These worries have been augmented as the strategic behaviors of important actors have begun to push against the borders of democratic structures as well as by a perceived popular malaise expressed through the ordinary channels of democratic participation. The stresses affect democratic governance in a variety of ways. Populism is one label that Western influence leaders use to identify stresses on the processes of mass participation in government, principally through elections. Deep state is what others reference as the portion of the government of states that appear insulated from mass politics. Legalism is what is referenced as the diversion of political discourse within domestic legal orders and their resolution by judicial rather than political bodies.  The response to these stresses remain tentative and in the earliest stages of development. The political order is being remade according to rules that are emerging and not clear, or as yet easy to understand. And yet it is clear that what will emerge from these sometimes tumultuous conversations will produce a new approach both to the theory and practice of democratic governance in the West to suit the new era of Western development in its many forms, a Liberal Democracy 2.0. At its core, these discussions touch on the continued development of stable structures that maintain robust and legitimate relations between individuals and the government that serves them, while elaborating systems of accountability and monitoring to suit the times.

China has also been deeply engaged in this global conversation about the shape and character of contextually legitimate but stable systems that express the core democratic foundation of the state and its government. Chinese leaders have recognized, probably more consciously and directly than their counterparts in the Western, that states and political communities worldwide appear to have moved to a new era in which many of the approaches to social, economic, political or cultural organizations require reconsideration—and adjustment to suit the times. Especially from the beginning of the leadership period of Xi Jinping, China, under the guidance of its vanguard CPC and in sometimes vigorous dialogue with its elite institutions, has turned to the development of its social and political forces with the same vigor with which it sought to develop its productive forces from early in the leadership of Deng Xiaoping.

Indeed, Chinese leaders have noted that as China has developed, its own governance systems have been facing new challenges. The techniques and approaches to democratic organization and operation, grounded in the assumptions of 20thcentury techniques, were now required to meet new challenges that followed from the successful development of Chinese productive forces and the deepening of Chinese engagement with the world.  The Chinese Communist Party (CPC) itself, in exercising its leadership responsibilities noted the shift from the challenges of development of productive forces to the emergence of a new contradiction at the heart of Chinese governance. The Report of the 19th CPC Congress made that clear:

What we now face is the contradiction between unbalanced and inadequate development and the people’s ever-growing needs for a better life. China has seen the basic needs of over a billion people met, has basically made it possible for people to live decent lives, and will soon bring the building of a moderately prosperous society to a successful completion. The needs to be met for the people to live better lives are increasingly broad. Not only have their material and cultural needs grown; their demands for democracy, rule of law, fairness and justice, security, and a better environment are increasing. At the same time, China’s overall productive forces have significantly improved and in many areas our production capacity leads the world. The more prominent problem is that our development is unbalanced and inadequate. This has become the main constraining factor in meeting the people’s increasing needs for a better life.

The impulse to further develop the productive forces of governance in the face of the fundamental challenges of China’s new era have acquired an increasingly clear contemporary form since the conclusion of the CPC’s 19th Congress in 2017. Xi Jinping’s Report to the 19th CPC Congress outlined a comprehensive approach to socialist democracy deeply embedded within the guiding leadership of the CPC and closely aligned with the people, state institutions, and the mechanisms of consultation now in long development within the Chinese People's Political Consultative Conference (CPPCC). Socialist democracy has become an umbrella concept that intermesh a number of important structures that constitute the framework within which democracy with both socialist and Chinese characteristics is defined and implemented.  Socialist democracy itself includes significant focus on popular consultation, and on the mediating power of law.  It also focuses on the parallel development of democratic structures and practices within the CPC that can then be used as a template for the exercise by the CPC of its leadership obligations. Democracy itself is shaped by an integrated normative structure centered on what are referenced as “core socialist values” from which it is possible both to implement and assess the working of institutions. But socialist democracy also integrates what is referenced as “socialist consultative democracy.” The Report to the19th CPC Congress explains:

We will advance extensive, multilevel, and institutionalized development of consultative democracy, and adopt a coordinated approach to promoting consultations carried out by political parties, people’s congresses, government departments, CPPCC committees, people’s organizations, communities, and social organizations. We will strengthen the institutions of consultative democracy and develop complete procedures and practices to enable the people’s broad, continuous, and intensive participation in day-to-day political activities.

Socialist consultative democracy has been developed around the United Front Parties as well as other representative institutional social organs.  It serves as a means through which popular engagement can be institutionalized and made effective.  Yet it appears to mean much more than that—integrating most aspects of official life within a tight web of consultation, monitoring, and review guided by the CPC.    

As in the West, these vigorous action appears to have produced a new approach both to the theory and practice of democratic governance in China to suit the new era of Chinese socialist development, a Marxist-Leninism 2.0 for the new era.  This conference brings together leading scholars from Europe, the United States and China, to consider the development of this Chinese Socialist Democracy  in the new era.  These scholars will consider the theory, form, and consequences of Marxist-Leninism 2.0 as expressed as contemporary Chinese Socialist  Democracy.  It will take as a starting point Xi Jinping’s consideration about the shape and practice of democracy within China:

“In such a vast and populous socialist country, extensive deliberation under the leadership of the CPC on major issues affecting the economy and the people’s livelihood embodies the unity of democracy and centralism. Chinese socialist democracy takes two important forms: In one, the people exercise their right to vote in elections; and in the other, people from all sectors of society undertake extensive deliberations before major decisions are made. In China these two forms do not cancel one another out, nor are they contradictory. They are complementary. They constitute institutional features and strengths of Chinese socialist democracy.” (Quoted from Li Junru, Consultative Democracy, People’s Democracy, China Today March 1, 2018).

Contributions will seek o theorize this emerging Marxist-Leninism 2.0, and to consider the role of key institutional actors and organs—the CPPCC, the state institutions, and other social and political forces—as well as their relationship to the CPC.  Analysis will be undertaken from a Chinese, Western and comparative perspective.  The core object of participants will be to seek to extract the fundamental theory and characteristics of the emerging systems, and to point to the likely paths to further development.  




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The Revised Draft Cuban Constitution Ready for Popular Vote--Comparison of Original and Revised Drafts

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As part of the Coalition for Peace & Ethics's Technical Assistance Project--Reforma de la Constitución del Estado cubano 2018/Reform of the Cuban State Constitution 2018, we have been writing about the contemporary project of constitutional reform in Cuba. That project, as I have suggested in earlier essays, is both a reflection of and constrained by the political and economic model adopted by the Communist Party and embraced by the National Assembly in 2017.  This project a larger study of the development of theories of endogenous democracy that increasingly might be used as a lens through which to understand the way that democracy might be practiced within Marxist Leninist systems (e.g., here, here, here, here, here, here, and here). These we seek to theorize and to study in local context.

Since 2011 Cuba has sought to develop, refine and practice a form of this endogenous democracy in ways that its governing party determines fits within its ideological principles. The initial initiative was undertaken during 2010 and 2011when the Cuban Communist Party (PCC) sought broad input on a project of substantial reform and opening up reflected in guidelines for PCC leadership. Broad, but substantially well constrained consultation was attempted again in 2016 as the Party and its state apparatus considered potentially substantial reform to its economic and political model in its 'Conceptualization of the Cuban socio-economic socialist development model' ("Conceptualización del modelo económico y social Cubano de desarrollo socialista")

This model of public consultation was then broadened and applied to the project of constitutional revision that began with the adoption of the Conceptualization. The PCC presented a draft revised constitution for consideration by the National Assembly (as reported in official accounts here).  Once revised, it was distributed widely for popular consultation.  These occurred over a short period of time in last 2018.  Meetings were organized all over Cuba at which small groups were assembled to give their opinion of the draft constitution. These were then summarized and delivered to the National Assembly.  Additionally there was intense debate in social media and among groups with strong interests in various provisions of the constitution, not least of which was debate about the constitutional protection of gay marriage.  The National Assembly met again to consider the popular consultation over a two day meeting (official reporting here). As revised, the draft constitution will be presented for approval.

The National Assembly's now final draft  has been distributed.  It may be accessed HERE.  

The Coalition for Peace and Ethics has also prepared a side by side comparison of the original and revised draft that may be accessed HERE.

In future posts we will provide more information about our empirical analysis of the patterns of popular engagement with constitution making.  The analysis will be made available in a forthcoming manuscript, The Democratic Constitution of the Illiberal States—An Empirical Approach to Popular Participation, Representation and Constitutional Reform in Cuba.

The revised draft follows.



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Concept Note: "Marxist Leninism 2.0--Popular Participation, Representation, and Constitutional Reform in Cuba;" Event to be Held at Penn State University 12 February 2018

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These are quite dynamic times for democracy--as theory, institution, and system.  What had once been a term whose contours and applications appeared  to converge around global certainties has encountered, in this new era of national and international relations, challenges from a number of quite distinct sources.  Though much attention has been paid to the specific challenges within the structures of Western liberal democracies, Marxist Leninist political  communities have also encountered the challenges of democracy within their own political systems.

It is with that in mind that we have organized an event hosted at Penn State University on 12 February 2019 that may be of interest to those who study democracy in action and the theories around which those actions are grounded.

The event, Popular Participation, Representation, and Constitutional Reform in Cuba,  brings together scholars from Europe, the United States, and China to consider recent developments in Cuban democratic theory and practice from a national and comparative perspective. Speakers will present the results of their study of popular participation in Cuban constitutional reform: The Democratic Constitution of Illiberal States—An Empirical Approach to Theorizing Popular Participation, Representation and Constitutional Reform in Cuba.The core object of participants will be to seek to extract the fundamental theory and characteristics that emerges from the exercise in constitutional reform that began in Cuba in 2016 and ends with a national plebiscite in February 2019. The possibilities of democratic consultation in an illiberal  democracy suggests consequences not just for Marxist Leninist states but also for liberal democratic systems.

The Concept Note Follows. This event, together with China's Socialist Democracy described earlier (see here), are the two parts of a one day international conference: Marxist-Leninism 2.0: Theory and Practice of Emerging Socialist Democracy in China and Cuba, about which more information here.




Marxist-Leninism 2.0: Theory  and Practice of Emerging Socialist Democracy in China and Cuba
Pennsylvania State University
12 February 2018
Lewis Katz Building
University Park
Sponsored by the Coalition for Peace & Ethics, the Foundation for Law and International Affairs, Penn State Law and School of International Affairs.  Funding provided in part by the Penn State University Park Allocation Committee.

 
Marxist-Leninism 2.0: Popular Participation, Representation and Constitutional Reform in Cuba
Concept Note


Popular participation and representation are the great antipodes of contemporary democratic theory. The former embodies the principle that political power resides in the individual; the latter that in the exercise of political authority such power must be delegated and exercised in a fiduciary capacity for the community of individuals. Yet representative delegation dilutes popular authority and requires regimes of accountability beyond elections; but popular control produces majoritarian tyranny if unconstrained.

In the construction of mediating institutions—governments and vanguard institutions mostly—political communities have drawn on a variety of theories that have sought to reconcile these core principles in the construction of government that is accepted as legitimate and thus whose authority over the polity may be asserted even without individual consent. Liberal democracies have moved from the concept of the embodiment of political self-constitution as incarnated in the body of a person (the Greek monos arkhein) to its incarnation within the body (res) of the people (publicus). But that incarnation, as well, has been situated within vanguard organizations—aristos kratia—the characteristics of which have undergone tremendous ideological transformation since the time of the Roman Republic—with its most powerful current expressions as liberal republican, Marxist Leninist vanguardist, transnational multilateralist organization. 

This panel brings together scholars and commentators from Europe, China and the United States  to consider the issues of the emergence of the markers of democratic self-constitution in illiberal states.  To that end Panelists will focus on the current process of constitutional revision in Cuba, a traditional Marxist-Leninist State in the process of self-transformation. For the last several years Cuba has been in the midst of a quite public national effort at reform. To that end it has revised its core political and economic principles through a complex process under the leadership of its Communist Party (PCC).  Those reforms to the organizing political and economic theory of the state then produced a move to reform the national constitution to reflect these reforms.  In both cases, the PCC and the state apparatus attempted to invoke the core mechanics of popular participation even as it sought to manage that participation under the leadership of the PCC and popular representatives in national institutions. 

What makes this process particularly interesting, with ramifications both for liberal democratic systems and multilateralist supra-national organizations with deep commitment to democratic principles, is the way in which the process of popular participation used multiple spaces. In particular, the emergence of social media platforms as novel ‘constitutive spaces’ pose a conundrum for constitutional theory.  Through the use of qualitative and quantitative measures this paper seeks to better understand both the changing character of popular participation in representative institutions, and its consequences for democratic theory.

Panelists will first present the preliminary results of their study,  The Democratic Constitution of Illiberal States—An Empirical Approach to Theorizing Popular Participation, Representation and Constitutional Reform in Cuba.  After an introduction to the study and its methodology, the panelists will discuss the findings based on analysis from government web sites, the official reports, and social media sites to examine the contours of participation, its constitution, and its limitations. Four data sets were used to seek to produce a more nuanced and complex ecology of participation.  The data sets included popular unofficial commentary on government web sites providing information about the constitutional process, commentary produced on a web site organized by elite civil society members. The third drew from comments on a facebook discussion site.  The fourth drew from official summaries of the results of formal public popular consultation organized by the PCC and state officials.  The last drew on the summaries of the intervention of Cuban legislators as they discussed the popular commentary and revised the draft proposed constitution. From these panelists will seek to draw a clearer understanding of the nature of popular participation, and consider consequences and applications both within Cuba and beyond.  Other commentators will then respond and comment on this work and suggest its implications for other states.
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Neutral Data and Strategic Transparency: The Legal Battles Over the Political and Governance Effects of a Census Question On Citizenship Status in "U.S. in New York v. U.S. Dept. of Commerce" (file 15 Jan. 2019)

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(Pix Credit U.S. Census Bureau)


As those with authority (and the "thought leaders" that help drive their thinking)  move more relentlessly to governance ideologies of data driven governance and transparency based accountability regimes, it is important to remember that every ideology tends to be applied strategically, and thus politically, to advantage those factions that make up the ruling groups of any community. The result is a a discursive fugue with two principle lines--the idealized ideological line, and the quite cynically manipulative interpretive line.  In the absence of mediating mechanisms, the two distinct lines can sometimes substantially diverge (e.g., Data, Analytics and Algorithm as Fetish and the Semiotics of Fake Facts).   

The politics of data and of the transparency regimes through which data driven governance could be legitimated is quickly embracing its character as politics by other means.  
Surveillance in our time is being transformed from a general and undifferentiated technique of governance to the active embodiment of governance itself. Surveillance is both the repository of governance norms and the discipline of those norms within any regulatory system. Surveillance is thus a bundle of assumptions, factors, assessments, and actions incarnated on the bodies of the regulated. Surveillance in its modern form represents another step in the perfection of social panopticism, of the creation of systems of social order that are self-regulating and internalized among those regulated. It represents a shifting of coercive power from the external-the state, the police, and the institution to the internal-the individual and the private. ("Global Panopticism: States, Corporations, and the Governance Effects of Monitoring Regimes," p. 112).
The consequences of these crisscrossing currents of politics and ideology at the center of the construction of data driven governance emerge clearly in the recent efforts of the Trump Administration to include a question about the citizenship status in the 2020 Census. As is increasingly common in contemporary America, those political issues, framed in law, are left to the courts. In New York v. U.S. Dept. of Commerce,  Case 1:18-cv-02921 (SDNY,  Filed 15 January 2019), a federal district court determined that the Secretary of Commerce unlawfully exercised what discretionary authority the law allowed in the ways he went about directing the insertion of the citizenship question that unlawfully annoyed some stakeholders and threatened others, in part because the decision was not  "reasonable and reasonably explained.” Mfrs. Ry. Co., 676 F.3d at 1096. The entire 277 pages of the opinion are worth reading for the complex interplay of politics, of the legal structures within which governance through data harvesting (strategically conceived), and of the role of the courts in mediating issues of data, data analytics and governance through mechanisms of more intensive structures for caging the exercise of administrative discretion, suggest the emerging American approaches to the construction of data driven governance. For the moment, the legalization of politics, even in the form of data driven analytics, appears still firmly embraced by the governing elites of the United States.  By the end of the opinion what emerges clearly are the convictions at data is never neutral, but is instead the expression of politics which is for Congress to control, and that transparency is not a primary premise of the gathering of information that is the Census. 

Most interesting, though, is the way that the courts have begun to use traditional mechanisms to deal with quite non traditional issues. These issue include the authority to apply politics to data--its formation and determination of what to harvest and in what form).  Is this a political issue (something hinted at by the Administration), or is it more an administrative decision with respect to which discretion is both channeled and constrained (something hinted at by the court). If Congress (and administrative agencies) can regulate through data and analytics, do both acquire a legislative character (and when appropriately delegated an administrative quasi legislative character) that can subject both the formulation of data and the construction of analytics (and the algorithms that give analytics political consequence) to the traditional constraints of statutes and administrative regulation, not indirectly through authorizing provisions, but directly as legislative acts in their own right. n a sense,  New York v. U.S. Dept. of Commerce, is merely the first salvo in what will be a very long conversation articulated as law and in courts.

Perhaps now is a good time to re-read  in the quite different light of the second decade of the 21st century an interesting foreign observation of American political culture written in the beginning of the third decade of the 20th century--Édouard Lambert,  Le Gouvernement des juges et la lutte contre la législation sociale aux États-Unis. L’expérience américaine du contrôle judiciaire de la constitutionnalité des lois (Paris, Marcel Giard & Cie., 1921. 276 pp.). Lambert spoke to the issue of division of authority over the machinery of politics in the United States; those insights and perspectives may be useful going forward in considering the division of authority among the political and judicial branches over governance modalities that the American founding generation might not have recognized.

A short news report of the case and issues follows (Judge rejects citizenship question for 2020 U.S. census) along with a small portion of the opinion.  One should expect that the issues developed in this opinion will be revisited on appeal.  But will the data related issues be understood in their own right? Stay tuned.





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New York v. U.S. Dept. of Commerce,  Case 1:18-cv-02921 (SDNY,  Filed 15 January 2019).


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C. Conclusions of Law Related to Standing
The Court turns, then, to its conclusions of law with respect to standing. Plaintiffs advance at least five distinct theories of how they have been, or will be, injured due to the addition of a citizenship question on the 2020 census, namely: (1) diminished political representation, both between and within states; (2) loss in government funds, again both between and within states; (3) harm to the sovereign interests of state and local governments caused by degradation of the census data upon which they rely; (4) diversion of resources; and (5) loss of privacy. The Court begins by addressing the question of certain NGO Plaintiffs’ standing to pursue claims based on any of those theories on behalf of their individual members (in addition to any standing they may have to pursue such claims in their own right). The Court then explains its conclusions as to whether each of these forms of injury is legally cognizable and, if so, whether Plaintiffs proved by a preponderance of the evidence that they have been, or will be, injured in that manner. As the Court will explain, it concludes that all five forms of injury are legally cognizable and that, for all but one of the theories namely, the loss of privacy at least some Plaintiffs proved by a preponderance that they have suffered, or will suffer, injury in fact sufficient to support standing. The Court then turns to whether Plaintiffs proved that those forms of injury are fairly traceable to Secretary Ross’s decision to add the citizenship question to the 2020 census and whether they are redressable by a favorable decision. Answering both questions in the affirmative, the Court concludes that most, if not all, Plaintiffs have Article III standing to bring the claims in these cases.
The Court notes that, aside from challenging each of Plaintiffs’ theories of injury on “traceability” grounds, Defendants make only limited objections to each individual theory of
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injury. Specifically, Defendants challenge Plaintiffs’ apportionment-loss and funding-loss theories only on the ground that they are insufficiently “imminent,” Defs.’ Post-Trial Br. 67-68, ¶¶ 11-14; the resource-expenditure theory only on the ground that Plaintiffs’ expenditures do not qualify as legally cognizable injuries-in-fact, id. at 69-70, ¶¶ 15-19; and the data-degradation theory only on the ground that it is not a sufficiently “concrete” and “tangible” injury for purposes of Article III, id. at 70, ¶¶ 20-21. Defendants do not explicitly address Plaintiffs’ theory of harm to their privacy interests anywhere in their Proposed Conclusions of Law. The Court cannot ignore the omitted objections given its independent obligation to assess its jurisdiction. But it is worth noting that Defendants themselves do not appear to believe that any of Plaintiffs’ injuries are not redressable or — apart from their ambitious objections to traceability, discussed below fairly traceable to the citizenship question.
1. Associational Standing
Before turning to Plaintiffs’ theories of injury, however, the Court briefly addresses the issue of associational standing namely, whether any of the NGO Plaintiffs have standing to bring claims on behalf of their individual members (in addition to any standing they may have to pursue such claims in their own right). An organization has “associational” standing to bring claims on behalf of its members if “(a) its members would otherwise have standing to sue in their own right; (b) the interests it seeks to protect are germane to the organization’s purpose; and (c) neither the claim asserted nor the relief requested requires the participation of individual members in the lawsuit.” Food and Commercial Workers v. Brown Grp., 517 U.S. 544, 553 (1996) (internal quotation marks omitted). The third of those requirements is only a prudential one — that is, it is not an element of Article III’s jurisdictional limitations on the power of the federal courts. See id. at 554-57.
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Applying those standards here, the Court concludes subject to its broader conclusions regarding standing below that three of the NGO Plaintiffs, NYIC, MRNY, and ADC, have proved that they have associational standing to seek relief on behalf of certain of their members. The second and third prongs of the analysis can be swiftly addressed. Defendants make no argument with respect to the third, non-jurisdictional prong and, thus, have waived the issue. Cf. Stolt-Nielsen S.A. v. AnimalFeeds Int’l Corp., 559 U.S. 662, 670 n.2 (2010). In any event, concerns of “administrative convenience and efficiency” favor associational standing, as neither the claims asserted nor the relief requested in this litigation call for significant participation by individual members; at most, the claims call for proof of their residence, but that can be readily established without direct participation. Food and Commercial Workers, 517 U.S. at 556-57. As for the second prong of the analysis, which Defendants also fail to contest, the Second Circuit has explained that an interest is “germane” to an organization’s purpose if the lawsuit would “reasonably tend to further the general interests that individual members sought to vindicate in joining the association and . . . bears a reasonable connection to the association’s knowledge and experience.” Bldg. & Constr. Trades Council of Buffalo & Vicinity v. Downtown Dev., Inc., 448 F.3d 138, 149 (2d Cir. 2006). Here, as discussed above, ADC’s, MRNY’s, and NYIC’s missions involve obtaining government benefits for their communities, including indeed, expressly by means of ensuring a fair and accurate census count of those communities. Thus, the second prong of the associational standing test is satisfied.
That leaves the first and only disputed prong of the analysis: whether the NGO Plaintiffs’ members would otherwise have standing to sue in their own right. Although proof of a mere “statistical probability that some of [an organization’s] members are threatened with concrete injury” is not enough to satisfy the first prong of associational standing, an organization can meet the first prong by offering “specific allegations” (along, at this stage, with proof)
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“establishing that at least one identified member had suffered or would suffer harm.” Summers v. Earth Island Institute, 555 U.S. 488, 497-98 (2009). Asserting that “a vague reference to unidentified members does not confer associational standing on an organization,” Defendants contend that the NGO Plaintiffs have “failed to identify any member who has standing to sue in his or her own right.” Defs.’ Post-Trial Br. 71, ¶¶ 25-26. While that is true of CASA, see generally Escobar Decl., it is not true of NYIC, MRNY, or ADC. NYIC has identified specific members who receive funds from federal programs that distribute those funds on the basis of census data. See Recitation of Facts ¶ 258. Similarly, MRNY has identified specific members who live in New York (and, more specifically, certain counties within the state) whose children attend Head Start programs or public schools that receive Title I funding. See Recitation of Facts ¶ 256. And ADC has identified specific members who reside in California, Florida, New York, the District of Columbia, and New Jersey. See Recitation of Facts ¶ 257. More generally, there is evidence that ADC has members residing in all fifty states. Id. That is sufficient to establish that those members, although unnamed, would have standing to the extent that standing depends only on the facts of their existence and residence in a particular jurisdiction. As will be discussed below, that is true with respect to some (albeit not all) of the theories of injury at issue here.48
48
Defendants seem to argue that an organization must identify particular members by name in order to have associational standing to pursue claims on their behalf. See Defs.’ Post-Trial Br. 71, ¶ 25. But the cases they cite do not support that proposition. As discussed, an organization can satisfy the first prong of the associational standing analysis by offering proof “establishing that at least one identified member ha[s] suffered or would suffer harm.” Summers, 555 U.S. at 498. It would overread the word “identified” in that context to require an organization to name the member who might have standing in his or her own right. In the first place, such specific identifying information is often unnecessary to determine whether a person would have Article III standing. For example, as in this case, whether a person will suffer a loss of political representation depends on the facts of his or her existence and residence within a particular jurisdiction, but not on his or her name. Where those (or other relevant) facts are proved, a court need look no further to conclude that the organization has members who would have standing to
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In short, three of the NGO Plaintiffs have established in addition to whatever standing they may have in their own right that they have standing to the same extent that certain of their individual members would have standing. More specifically, NYIC has standing to the extent that its members who receive funds from census-tied programs would have standing. MRNY has standing to the extent that its individual members residing in New York State generally, and Queens, Brooklyn, the Bronx, and Long Island specifically, would have standing and to the extent that its individual members whose children attend Head Start programs or public schools that receive Title I funding would have standing. And ADC has standing to the extent that its individual members residing in all fifty states and the District of Columbia and certainly those residing in California, New York, Pennsylvania, Texas, Florida, Rhode Island, Washington State, Arizona, Illinois, Maryland, New Jersey, and the District of Columbia would have standing.
2. Injury in Fact
With that, the Court turns to Plaintiffs’ five theories of injury: (1) loss of political representation, both between states (in congressional reapportionment) and within states (in redistricting); (2) loss of federal funds, also both between and within states; (3) harm to important sovereign interests caused by degradation of the census data on which state and local governments rely; (4) injury to organizations and local governments through the diversion of,
pursue a particular claim in their own right. Moreover, to hold that Article III requires an organization to name those of its members who would have standing would be in tension with one of the fundamental purposes of the associational standing doctrine namely, protecting individuals who might prefer to remain anonymous. See NAACP v. Alabama ex rel. Patterson, 357 U.S. 449, 458-60 (1958); see also Food and Commercial Workers, 517 U.S. at 551-52. Dicta about “unidentified members” aside, the most that Defendants’ cases establish is that a plaintiff must prove “facts sufficient to establish that one or more of its members has suffered, or is threatened with, an injury.” Valley Forge Christian Coll. v. Ams. United for Separation of Church & State Inc., 454 U.S. 464, 487 n.23 (1982). For the reasons discussed above, ADC has done so, even as to those members whom it does not identify by name.
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and strain inflicted upon, organizational resources; and (5) infringement of privacy interests in the information collected by the census. As noted, the Court concludes that all five forms of injury are legally cognizable and that, as to four of the five namely, all except the privacy- infringement theory at least some Plaintiffs have proved by a preponderance of the evidence that they have suffered, or will suffer, injury in fact sufficient to support standing.
a. Diminished Political Representation
First, Plaintiffs have proved that several states are likely to lose one or more seats in the next round of congressional redistricting if the citizenship question is added to the census. See Recitation of Facts ¶ 243-45. The Supreme Court has squarely held that the loss of a seat or seats in the House of Representatives “undoubtedly satisfies the injury-in-fact requirement of Article III standing” because of the dilution of political power that results from such an apportionment loss. Dep’t of Commerce, 525 U.S. at 331; accord Carey v. Klutznick, 637 F.2d 834, 836-38 (2d Cir. 1980); cf. Utah v. Evans, 536 U.S. 452, 458 (2002). Further, although the census is still months away, such an injury is sufficiently “imminent” to invoke federal-court jurisdiction now. See Dep’t of Commerce, 525 U.S. at 327, 332 (finding threatened vote dilution because of census modifications sufficiently “imminent” in two lawsuits brought twenty-five months before the census date).
In particular, Plaintiffs have proved that California’s prospective loss of a seat in the House of Representatives is “certainly impending.” See Recitation of Facts ¶¶ 243, 245. And although California is not a Plaintiff here, ADC is and, as discussed, it has individual members who reside in California. See id. ¶ 257. Those individual members’ “expected loss of a Representative to the United States Congress undoubtedly satisfies the injury-in-fact requirement
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of Article III standing.” Dep’t of Commerce, 525 U.S. at 331.49 Plaintiffs have also proved that New York and Illinois face a “substantial risk” that they will lose at least one seat in the next Congressional reapportionment because of the citizenship question’s addition to the 2020 Census. See Recitation of Facts ¶¶ 243, 245. New York and Illinois are Plaintiffs here, and thus have standing to seek a remedy for that injury in their own right. Cf. Evans, 536 U.S. 452. Additionally, that provides an independent basis for ADC and MRNY to seek relief, as ADC has individual members who reside in New York and Illinois, see Recitation of Facts ¶ 257, and MRNY has individual members who reside in New York, see id. ¶ 256. ADC’s individual members who reside in Texas, Arizona, and Florida, see id. ¶ 257, likewise face a substantial risk of lost representation in the U.S. House of Representatives.
A closer question is whether Plaintiffs have also proved that any of the NGO Plaintiffs’ members will suffer an Article III injury in fact in the form of lost representation in intrastate
49
Although Defendants do not raise the issue, the jurisdictional nature of the standing inquiry compels the Court to note that ADC’s standing does not depend on proof that its members residing in California and elsewhere are U.S. citizens or voters matters on which the record is silent. While intrastate redistricting is governed by the Equal Protection Clause’s “one person, one vote” principle, interstate congressional apportionment is governed by Section 2 of the Fourteenth Amendment, which provides that “Representatives shall be apportioned among the several States according to their respective numbers, counting the whole number of persons in each State, excluding Indians not taxed.” U.S. Const. amend. XIV, § 2 (emphasis added). Thus, while a nonvoter might or might not have standing to challenge a district on a representational dilution theory under the Equal Protection Clause an open question, however much common sense might suggest the answer is “yes,” see, e.g., Calvin v. Jefferson Cty. Bd. of Comm’rs, 172 F. Supp. 3d 1292, 1307 n.12 (N.D. Fla. 2016) — the “undoubted[]” Article III injury that a person suffers when his or her state loses a representative in congressional reapportionment, Department of Commerce, 525 U.S. at 331, ultimately traces to a legally protected interest that does not depend on that person’s citizenship status or eligibility to vote. See Evenwel v. Abbott, 136 S. Ct. 1120, 1127-28 & n.9 (2016) (describing the original understanding of population-based apportionment, which James Madison called a “fundamental principle of the proposed constitution,” as reflecting Alexander Hamilton’s “principled argument for allocating seats to protect the representational rights of every individual of the community at large,” and describing the understanding of the Fourteenth Amendment’s framers that “non- voting classes may have as vital an interest in the legislation of the country as those who actually deposit the ballot” (citations and internal quotation marks omitted)).
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redistricting carried out on the basis of the federal decennial census. Intrastate vote dilution plainly qualifies as an injury in fact for purposes of Article III. Dep’t of Commerce, 525 U.S. at 332-33; Carey, 637 F.2d at 838. In Department of Commerce, for example, the Supreme Court held — given the fact that certain counties “were substantially likely to lose population” under the Census Bureau’s plan — that residents of those counties had satisfied Article III’s injury-in- fact requirement. 525 U.S. at 334. In other words, all the Court required was proof that (1) certain states relied on federal decennial census data for intrastate redistricting, (2) voters in certain counties in those states were “substantially likely . . . to suffer vote dilution as a result of the [Census Bureau’s] plan,” and (3) plaintiffs were among the voters who lived in those counties in those states. Id. at 332-34 (internal quotation marks omitted). As that language suggests, however, the Supreme Court has tended to describe the injury in the intrastate vote- dilution context as affecting only eligible voters. Here, Plaintiffs have proved that several of the NGO Plaintiffs’ individual members reside in counties that will lose statewide population shares because of the citizenship question, but the record is silent as to whether those members are also eligible voters. In this instance, the Court concludes that the interests of avoiding an unnecessary holding on a delicate constitutional question outweigh even the powerful interests favoring resolution of all open legal issues in this Opinion. See Ashwander, 297 U.S at 347 (Brandeis, J., concurring). The Court therefore declines to address whether the facts proved by Plaintiffs are legally sufficient to establish that any of the NGO Plaintiffs’ members will suffer an Article III injury when, at a minimum, they lose political representation in the next intrastate redistricting.
b. Loss of Government Funds
Second, given the Court’s factual findings, many Plaintiffs have proved that they will suffer a loss of funding from federal programs that distribute such funding on the basis of census data. Such a monetary loss is a classic form of Article III injury in fact. See Carey, 637 F.2d at
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838 (holding that “citizens who challenge a census undercount on the basis . . . that improper enumeration will result in loss of funds to their city have established . . . an injury” for purposes of standing); accord City of Detroit v. Franklin, 4 F.3d 1367, 1374-75 (6th Cir. 1993); City of Philadelphia v. Klutznick, 503 F. Supp. 663, 671 (E.D. Pa. 1980); City of Camden v. Plotkin, 466 F. Supp. 44, 47-51 (D.N.J. 1978). More specifically, a state or locality that proves that it will lose funds under federal revenue-sharing programs satisfies Article III’s injury-in-fact requirement. See Carey, 637 F.2d at 838 (“New York City and New York State . . . have standing as recipients of federal funds under revenue sharing.”). So too, an individual who proves that he or she will suffer a loss of federal benefits has adequately proved an Article III injury. See id. (“The individual plaintiffs in this case have alleged concrete harm in the form of . . . decreased federal funds flowing to their city and state, thus establishing their standing.”).
Applying those principles here, the Court concludes as follows:
  • Plaintiffs Illinois, Massachusetts, Maryland, New Jersey, New Mexico, New York, Oregon, Washington State, and the District of Columbia have proved that if the net undercount of noncitizens attributable to the citizenship question is as low as two percent far lower than the Court has found to be the best estimate they will lose funds from several federal programs. See Recitation of Facts ¶¶ 251-52. On that basis, the Court concludes that those Plaintiffs face “certainly impending” injuries.
  • Plaintiffs have also proved that (1) MRNY’s individual members who reside in New York and (2) ADC’s individual members who reside in California, Texas, Florida, Nevada, and Hawaii, and in Plaintiff States New York and New Jersey, face a “certainly impending” Article III injury for the same reasons. See Recitation of Facts ¶¶ 256-67.
  • Additionally, Plaintiffs have proved that MRNY’s individual members who reside in New York and benefit from Title I and Head Start funds will suffer an individualized harm that is “certainly impending,” in light of its propensity to occur in even the most implausibly low noncitizen net undercount scenarios. See Recitation of Facts ¶ 256.
  • Finally, Plaintiffs have proved that NYIC’s members Chhaya, LSA, Korean Community Services of Metropolitan New York, Planned Parenthood of New York City, and Chinese-American Planning Council all receive funding through programs that allocate funds to states based on census data. See Recitation of Facts ¶ 258. Given the net undercount scenarios that the Court has found to be likely, those organizations have proved that they face a substantial risk of an Article III injury in the form of lost funding.
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Defendants argue that, even if Plaintiffs have proved these losses are likely to occur, they do not count as Article III injuries because they may be “offset” by gains that turn up elsewhere in the federal funding scheme. See Tr. 506; Defs.’ Post-Trial Br. 34-36, ¶¶ 220-38. But “the fact that an injury may be outweighed by other benefits, while often sufficient to defeat a claim for damages, does not negate standing.” Denney v. Deutsche Bank AG, 443 F.3d 253, 265 (2d Cir. 2006); see also Texas v. United States, 809 F.3d 134, 155-56 (5th Cir. 2015), aff’d by an equally divided Court, 136 S. Ct. 2271 (2016) (mem.); NCAA v. Governor of N.J., 730 F.3d 208, 223 (3d Cir. 2013) (“A plaintiff does not lose standing to challenge an otherwise injurious action simply because he may also derive some benefit from it. Our standing analysis is not an accounting exercise . . . .”), abrogated on other grounds by Murphy v. NCAA, 138 S. Ct. 1461 (2018); Alaska Elec. Pension Fund v. Bank of Am. Corp., 175 F. Supp. 3d 44, 53 (S.D.N.Y. 2016).
Plaintiff Colorado will also suffer an injury for a related reason: It will lose the ability to spend funds because its own state constitution limits year-on-year increases in expenditures to a function of the state’s population growth as determined by federal census data. The Colorado “Taxpayer’s Bill of Rights,” ratified into the Colorado Constitution, limits the “maximum annual percentage change in state fiscal year spending” to “inflation plus the percentage change in state population in the prior calendar year, adjusted for revenue changes approved by voters after 1991,” and provides that “[p]opulation shall be determined” for that purpose “by annual federal census estimates and such number shall be adjusted every decade to match the federal census.” Colo. Const. art. X, § 20(7)(a); see Colo. Rev. Stat. § 24-77-103(1)(c)(III) (providing for a formula to recalculate the percentage change each year on the basis of new federal census estimates). Whether characterized as a loss in funding, or a loss in the ability to spend for the general welfare of its residents (and, thus, an infringement on Colorado’s sovereign interests), Colorado will suffer an Article III injury if its population is undercounted by even the smallest
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amount. Given the Court’s findings as to the likely net undercount of Colorado’s population, see Recitation of Facts ¶ 249, the Court concludes that Colorado faces a “certainly impending” injury traceable to the addition of the citizenship question.
In sum, given the remarkably low net undercount of noncitizens that would prompt the foregoing losses of funding, Governmental Plaintiffs Colorado, Illinois, Massachusetts, Maryland, New Jersey, New Mexico, New York, Oregon, Washington State, and the District of Columbia; and NGO Plaintiffs ADC, MRNY, and NYIC have established an injury in fact that is “certainly impending.” At a minimum, there is no doubt that these Plaintiffs have demonstrated a “substantial risk” that they will suffer such injuries. In either case, these Plaintiffs have satisfied Article III’s injury-in-fact requirement.

c. Harm to the Quality and Accuracy of Data
Next, the Governmental Plaintiffs proved that they will suffer injury in fact from the degradation in data quality that would occur if the citizenship question appears on the 2020 census. At the outset, there is no reasonable dispute that Plaintiffs proved by a preponderance of the evidence that addition of the citizenship question would result in that harm. Indeed, the evidence at trial was undisputed that, regardless of how successful NRFU operations are in remedying a net differential undercount due to a differential decline in self-response rates, the addition of the citizenship question will result in harm to the quality of census data. First, as noted above, that was the original position of the Census Bureau in connection with its review of DOJ’s request. See Recitation of Facts ¶¶ 8, 19, 28-30, 34. Second, Defendants own expert, Dr. Abowd, agreed, testifying that the addition of a citizenship question would harm the overall quality of 2020 census data regardless of any net undercount scenario. See Tr. 882, 952-53, 1221-22, 1251. And third, Plaintiffs’ experts testified credibly in the same manner. Tr. 302-04. Additionally, Dr. Salvo, the Director of the New York City Department of City Planning’s
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Population Division, explained credibly that the degradation in quality of the data would harm New York City’s ability to allocate educational and public health resources efficiently and effectively. See Recitation of Facts ¶ 263.50 Crucially, these harms will occur whether or not there is a net undercount meaning that this theory of injury does not depend on the causal chain of events connecting the decline in self-response rates among noncitizen households to a net differential undercount of people who live in such households.
Understandably, then, Defendants raise no objections in their post-trial filings to the imminence, traceability, or redressability of this harm. See Defs.’ Post-Trial Br. 70, ¶¶ 20-21. Instead, the principal dispute between the parties is whether a degradation in the quality of census data is a legally cognizable harm. Compare id., with Pls.’ Proposed Conclusions ¶¶ 57- 59. The Court agrees with Plaintiffs that it is. For starters, the Supreme Court has consistently held that the “inability to obtain information” is a cognizable Article III injury. FEC v. Akins, 524 U.S. 11, 21 (1998); Pub. Citizen v. U.S. Dep’t of Justice, 491 U.S. 440, 449 (1989) (“[R]efusal to permit appellants to scrutinize the ABA Committee’s activities to the extent [the Federal Advisory Committee Act] allows constitutes a sufficiently distinct injury to provide standing to sue.”); id. (“Our decisions interpreting the Freedom of Information Act have never suggested that those requesting information under it need show more than that they sought and were denied specific agency records.”). If the inability to obtain information is a cognizable form of injury for Article III purposes, it follows a fortiori that the inability to obtain accurate
50
Defendants contend that Dr. Salvo’s testimony about the citizenship question’s effects on data quality was too “conclusory” and “lacked key specifics,” including that he did not name the precise city services that might be affected by a decline in data quality. Defs.’ Post-Trial Br. 40, ¶ 264. At best, Defendants’ criticisms amount to little more than nitpicking. Dr. Salvo testified credibly that the City’s allocation of resources with respect to several important programs would be harmed by the degradation in data quality attributable to the citizenship question and, moreover, did name specific examples relating to the New York City Board of Education and Department of Health. See Recitation of Facts ¶ 263.
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information would be as well. After all, there is no interest in obtaining false or faulty information.
To be sure, many of these cases involved statutory entitlements to certain information the classic example of such an entitlement (although, interestingly, the example least discussed in the context of Article III standing) being the Freedom of Information Act. That is no objection to the conclusion that the Supreme Court has recognized the denial of information as an Article III injury, however, because if such an injury were not already “concrete” enough for Article III purposes, Congress could not make it so. As the Supreme Court recently clarified, “Congress’ role in identifying and elevating intangible harms” does not allow it to grant standing on the basis of pure statutory violations — instead, “Article III standing requires a concrete injury even in the context of a statutory violation.” Spokeo, 136 S. Ct. at 1540. Thus, if the claims of informational injury discussed in the cases amounted to nothing more than “bare procedural violation[s], divorced from any concrete harm,” they would not “satisfy the injury-in- fact requirement of Article III,” id. but they are more than that, so they do.
Similarly, a state that relies on the information provided by the federal government under an existing statutory arrangement suffers a sufficiently “concrete” and “particularized” injury for purposes of Article III when the federal government degrades the quality of that information. States are sovereign entities with sovereign interests in the making and enforcement of their own laws. See Alfred L. Snapp & Son, Inc. v. Puerto Rico ex rel. Barez, 458 U.S. 592, 601 (1982); cf. Maryland v. King, 567 U.S. 1301, 133 S. Ct. 1, 3 (2012) (Roberts, C.J., in chambers) (concluding that Maryland suffered an injury to its “law enforcement and public safety interests” from a lower-court order preventing the state from utilizing DNA samples for law enforcement purposes pursuant to a state statute). But they frequently do so in collaboration with, or in reliance on, the federal government such is the genius of the federal system, which has historically embraced
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various creative models of “cooperative federalism.” See, e.g., New York v. United States, 505 U.S. 144, 167-69 (1992); Hodel v. Va. Surface Mining & Reclamation Assn., Inc., 452 U.S. 264, 286-89 (1981). Most relevant here, states have long relied on federal decennial census data for countless sovereign purposes, and many of the State Plaintiffs here even require the use of such data by law; in some instances, it is written into their state constitutions.
The most noteworthy examples of this reliance are the State Plaintiffs that mandate the use of federal decennial census data to apportion state representatives. See, e.g., Recitation of Facts ¶ 246; see also Georgia, 539 U.S. at 488 n.2; Dep’t of Commerce, 525 U.S. at 333 n.4, 334. But state reliance on federal census data for sovereign purposes is goes well beyond that, as the following examples ranging from the profound to the mundane make plain:
  • States often seek to apportion governmental expenses equitably among local governments, for example, by requiring each county to contribute in proportion to its share of population as calculated by the latest federal decennial census. See, e.g., Colo. Rev. Stat. § 20-1-208 (requiring counties to contribute towards the salaries of employees in Colorado district attorneys’ offices according to the counties’ population share, as determined in the “last preceding decennial census” of the district in which each county sits); Conn. Gen. Stat. Ann. § 7-338 (requiring that the expenses of a charter commission for a new metropolitan fire, sewer, or water district be apportioned among “each town, city or borough” according to its proportion of the district’s total population, “as determined by the last-preceding federal census”).
  • Other states provide for direct state aid to local governmental units on a per capita basis, relying on federal decennial census data to ensure a fair distribution of resources. See, e.g., 30 Ill. Comp. Stat. 115/2(a) (requiring monthly allocations of the Illinois “Local Government Redistributive Fund” and “Income Tax Surcharge Local Government Distributive Fund” in proportion to cities’ and counties’ population as determined by federal decennial census data); Minn. Stat. Ann. § 260.821(1)(b) (requiring that support grants to Indian tribes be apportioned, in part, on the basis of “the ratio of the tribe’s on- reservation population to the state’s total on-reservation population,” as determined by the “most recent federal census data”); R.I. Gen. Laws §§ 23-18.9-1, 23-18.9-3 (requiring that funds appropriated as grants in aid of local refuse disposal services be distributed according to a community’s share of the statewide population, according to federal census data); N.Y. State Fin. Law § 54(2) (McKinney) (providing that each fiscal year, there shall be apportioned and paid to the several counties, cities, towns and villages, from moneys appropriated by the state, for the support of local government” amounts in proportion to their “population”); id. § 54(1)(a)(1) (defining “population” to mean “the population as shown by the latest preceding decennial federal census” or a “special
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population census”).
  • Some states also redistribute state tax receipts to cities on the basis of each city’s population share. See, e.g., Iowa Code Ann. § 312.3(2)(a) (providing that the state treasurer shall, on the first day of each month, “[a]pportion among the cities of the state, in the ratio which the population of each city, as shown by the latest available federal census, bears to the total population of all such cities in the state, the percentage of the road use tax funds which is credited to the street construction fund of the cities”); N.M. Stat. Ann. § 7-1-6.26(C) (providing that counties shall receive a share of the “county government road fund” calculated in part based on the county’s population “as shown by the most recent federal decennial census”); Or. Rev. Stat. § 221.770 (requiring that certain liquor revenues be apportioned among Oregon’s cities in part based on their population as determined by federal census data).
  • North Carolina apportions state support to community colleges in part based on a formula that takes into account ratios of county and area populations as determined by the “latest United States census.” N.C. Gen. Stat. § 115D-31(a)(3).
  • Pennsylvania sets the maximum salary for the mayor of any city with a population greater than 15,000 at “$500 per every thousand residents per year as determined by the most recent census data provided by the United States Census Bureau.” 11 Pa. Cons. Stat.
    §
    11208(a), (b). It also sets the maximum “tapping fee” that a sewer or water authority may charge a property owner who connects to the authority’s sewer or water system as a function of the average household size “as established by the most recent census data provided by the United States Census Bureau.” 53 Pa. Cons. Stat. § 5607(d)(24) (i)(C)(V)(e).
  • Some states more generally define “population” for the purpose of their laws to mean population as calculated in the most recent federal decennial census. See, e.g., Iowa Code Ann. § 9F.6 (“Whenever the population of any county, township or city is referred to in any law of this state, it shall be determined by the last preceding certified federal census unless otherwise provided.”); N.Y. Gen. Constr. Law § 37-b (McKinney) (“The term population when used in relation to this state . . . shall, unless otherwise provided in relation to such use, mean population as shown by the latest federal census published as a final population count by the United States bureau of the census.”); Va. Code Ann. § 1- 235 (“‘Population’ or ‘inhabitants’ means with reference to any county, city, town, political subdivision of the Commonwealth or any combination thereof, the natural persons in such county, city, town, political subdivision or combination as shown by the unadjusted United States decennial census . . . .”).
    Meanwhile, it is, of course, the federal government’s job to collect and distribute accurate federal decennial census data. See U.S. Const. art. I, § 2, cl. 3; see also Utah, 536 U.S. at 478 (explaining that the Framers had a “strong constitutional interest in [the] accuracy” of the census); Wisconsin, 517 U.S. at 20 (holding that the conduct of the census must bear a
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“reasonable relationship to the accomplishment of an actual enumeration of the population, keeping in mind the constitutional purpose of the census,” namely, obtaining an accurate count of the population in each state); Pub. L. No. 105-119, § 209(a)(6), 111 Stat. at 2481 (“Congress finds that . . . [i]t is essential that the decennial enumeration of the population be as accurate as possible, consistent with the Constitution and laws of the United States.”). When the federal government degrades the quality of that data, it therefore inflicts a cognizable injury on the sovereign interests of reliant states.51
An example may be helpful in illustrating the point. Suppose a state were to premise certain of its policies on a person’s lawful presence in the United States — for example, suppose that it chose to deny certain benefits to undocumented immigrants or required its law- enforcement officials to inquire into the immigration status of any person detained in state custody for any reason. “The accepted way” for states “to perform [such] status checks” — and surely the most reliable — is to contact the DHS’ Immigration and Customs Enforcement (“ICE”), the federal agency that accepts and responds to such inquiries from interested states. Arizona v. United States, 567 U.S. 387, 411 (2012). Now suppose that ICE were to degrade the quality of its data set, thereby undermining its usefulness to the state as a tool for implementing its policy priorities. If this hypothetical state were to challenge the decisions causing the degradation in immigration-status data, the federal agency could certainly defend its actions on the grounds that they were lawful. But could it seriously deny that the state had suffered a cognizable injury for purposes of standing? Surely not.
51
That does not mean that, in every case, a state will have a “right” to such data — or a right to data of a certain quality sufficient to support a valid cause of action to obtain it. But it does mean that a state suffers a concrete and particularized injury when the federal government degrades important tools of sovereignty or takes those tools away altogether.
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Indeed, ample case law supports the proposition that a state has a strong sovereign interest in conducting its own policy, the burdening of which causes an injury in fact for Article III purposes. One such sovereign interest is a state’s “exercise of sovereign power over individuals and entities within [its] jurisdiction this involves the power to create and enforce a legal code, both civil and criminal.” Alfred L. Snapp & Son, 458 U.S. at 601. Another such sovereign interest which, in light of the frequent prohibition on parens patriae suits against the federal government, Massachusetts v. Mellon, 262 U.S. 447, 485-86 (1923), is “distinct from . . . the general well-being of its residents” — is a state’s “interest in securing observance of the terms under which it participates in the federal system,” Alfred L. Snapp & Son, 458 U.S. at 607- 08; cf. Maine v. Taylor, 477 U.S. 131, 137 (1986) (“[A] State clearly has a legitimate interest in the continued enforceability of its own statutes.”); Diamond v. Charles, 476 U.S. 54, 65 (1986) (“Because the State alone is entitled to create a legal code, only the State has the kind of ‘direct stake’ . . . in defending the standards embodied in that code.”).
The Fifth Circuit’s decision in Texas v. United States, 809 F.3d 134 (5th Cir. 2015), aff’d by an equally divided Court, 136 S. Ct. 2271 (2016), is instructive on this front. In that case, Texas led a coalition of states in a challenge to the Obama Administration’s Deferred Action for Parents of Americans and Lawful Permanent Residents program (“DAPA”). The Court held that the states had suffered a cognizable injury for purposes of standing because DAPA would have entitled its recipients to obtain driver’s licenses under existing state law and providing those licenses would have come at a financial cost to Texas. See id. at 155-56. In denying a stay of the district court’s preliminary injunction pending appeal, the Fifth Circuit cited Alfred L. Snapp & Son, explained that Texas possessed a sovereign interest in the maintenance of its own legal code, and held that “Texas’s forced choice between incurring costs and changing its laws is an injury because those laws exist for the administration of a state program, not to challenge federal
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law, and Texas did not enact them merely to create standing.” 787 F.3d 733, 749 (5th Cir. 2015). The court reasoned that “if pressure to change state law in some substantial way were not injury, states would have no standing to challenge bona fide harms because they could offset most financial losses by raising taxes or fees.” Id. Several months later, the Fifth Circuit affirmed the preliminary injunction on the merits, reiterating and confirming its conclusions as to standing. The Circuit held that “states may have standing based on . . . federal interference with the enforcement of state law, at least where the state statute at issue regulates behavior or provides for the administration of a state program and does not simply purport to immunize state citizens from federal law.” 809 F.3d 134, 153 (alterations and internal quotation marks omitted). Such “intrusions,” the court explained, “are analogous to pressure to change state law.” Id.
Like the state plaintiffs in Texas v. United States, the State Plaintiffs here have enacted their reliance on federal census data into law in some cases, as noted, even into their constitutions. Moreover, as in Texas v. United States, “there is no allegation,” let alone proof, that those jurisdictions enacted their laws or ratified their constitutions “to manufacture standing” in these cases. Texas, 809 F.3d at 159. If a citizenship question is added to the decennial census, these Plaintiffs will be subjected to a forced choice: They can use the degraded data, resulting in worse policy; they can spend money to compensate for the damage; or they can change their laws to relieve themselves of the legal obligation to use federal census data in making and enforcing their laws (which would presumably necessitate the expenditure of additional resources to collect data of their own anyway). Such “pressure[] to change state law constitutes an injury” within the meaning of Article III. Texas, 787 F.3d at 749; see Texas, 809 F.3d at 153.
Accordingly, several Governmental Plaintiffs including State Plaintiffs New York, Colorado, Connecticut, Delaware, Illinois, Iowa, Maryland, Massachusetts, Minnesota, New Jersey, New Mexico, North Carolina, Oregon, Pennsylvania, Rhode Island, Virginia, and
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Washington, and Plaintiff New York City have proved an imminent injury to their sovereign interests through the degradation in quality of federal census data.
d. Diversion of Resources
Next, the Court finds that the NGO Plaintiffs have established that they have already suffered, and will continue to suffer, injury in fact due to a diversion of their resources. In Havens Realty Corp. v. Coleman, 455 U.S. 363 (1982), the Supreme Court held that an organization can establish Article III injury in fact by proving “concrete and demonstrable injury to [its] activities with the consequent drain on [its] resources.” Id. at 379; see id. at 379 n.21 (holding that an organization that proves it “has indeed suffered impaiment” in its activities has proved an Article III injury); Nnebe v. Daus, 644 F.3d 147, 157 (2d Cir. 2011) (requiring a showing of “perceptible impairment”); see also Ragin v. Harry Macklowe Real Estate Co., 6 F.3d 898, 904-06 (2d Cir. 1993). Although an organization may not inflict such an “impairment” on itself for purposes of creating standing for example, by incurring litigation expenses in the very lawsuit at issue, see, e.g., Citizens for Responsibility and Ethics in Wash. v. Trump, 276 F. Supp. 3d 174, 189-93 (S.D.N.Y. 2017) (“CREW”) — the Havens Realty theory of organizational standing squarely covers a claim of injury from “purportedly illegal action [that] increases the resources the group must devote to programs independent of its suit challenging the action.” Spann v. Colonial Vill., Inc., 899 F.2d 24, 27 (D.C. Cir. 1990) (R.B. Ginsburg, J.); see CREW, 276 F. Supp. 3d at 190 (noting that Havens Realty applies where the “[d]efendant’s actions have impeded” an organization’s “ability to perform a particular mission-related activity, or [forced it] to expend resources to counteract and remedy the adverse consequences or harmful effects of [the] [d]efendant’s conduct”). This is exactly the kind of injury that NGO Plaintiffs allege here.
Defendants suggest that Havens Realty recognizes Article III injuries arising from organizational expenditures, but only where those expenditures are made in response to injuries
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that are themselves sufficiently imminent and impending to satisfy Article III. See Defs.’ Post- Trial Br. 69, ¶ 15; Tr. 1486-89. Of course, that argument is beside the point because Plaintiffs have proved such injury, as discussed above. But the argument also makes no sense on its own terms. It would be illogical to recognize that organizations may be injured by expenditures made in response to future injuries, as the Supreme Court continues to do, see Clapper, 568 U.S. at 414 n.5, but to hold that that doctrine applies only in cases in which it would be superfluous. Indeed, that would render the category of plaintiffs that could establish standing under a Havens Realty theory a null set. Conspicuously, though, Defendants cite no Supreme Court case holding (or even hinting) that Havens Realty has been so cabined, much less overruled.
Applying Havens Realty here, the Court finds that the NGO Plaintiffs plainly have standing to challenge Secretary Ross’s decision. That is, all four NGO Plaintiffs have proved that the citizenship question will cause them indeed, already is causing them to divert organizational resources away from their core missions and towards combating the negative effects of the citizenship question. See Recitation of Facts ¶¶ 265-74.52 Defendants’ arguments to the contrary are somewhat ironic because the record makes clear that the Census Bureau itself relies on organizations like the NGO Plaintiffs to ensure a successful census and will rely on them to counteract the indisputably negative effects of the citizenship question. See, e.g., Recitation of Facts ¶¶ 187-88, 274. In fact, Dr. Abowd, Defendants’ own expert, explicitly conceded that addition of the citizenship question on the census will make the “job[s]” of these
52
Some of the NGO Plaintiffs cite expenses related to this litigation among the resources that they have expended because of the citizenship question. See, e.g., Altschuler Decl. ¶ 22. A claim of injury predicated on litigation expenses alone, however, would stand on shaky ground. See CREW, 276 F. Supp. 3d at 189-93. Given that the NGO Plaintiffs’ injuries involve diversion of resources other than mere litigation expense, see, e.g., Altschuler Decl., ¶¶ 19-21, the Court need not and does not rely on litigation expenses in reaching its conclusions that the NGO Plaintiffs have proved injury in fact.
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organizations “harder.” Tr. 1303-05. In other words, Defendants’ own arguments against the NGO Plaintiffs’ injury depend on their prediction that any impending decline in self-response rates will be mitigated, in part by organizations such as the NGO Plaintiffs that will spend money and devote organizational resources to combat the citizenship question’s negative effects. Defendants’ own arguments against Plaintiffs’ other theories of standing therefore serve to confirm this one.
In contending that the NGO Plaintiffs have not proved this theory of injury, Defendants also fault the NGO Plaintiffs for the lack of any testimony “that their expenditure of resources took into account the extent to which the Census Bureau’s [NRFU] procedures would mitigate any differential net undercount attributable to the citizenship question.” Defs.’ Post-Trial Br. 40, ¶ 262. In other words, Defendants suggest that Plaintiffs should be denied standing to seek a remedy in federal court because they should have trusted the same parties who caused their injuries in the first place to fix them. That may be the kind of thing the fox would say to the henhouse, but it is not what one would expect the federal government to say to a coalition of civil rights organizations challenging what they believe to be unlawful governmental action. In any event, the argument is unpersuasive on its merits, too, as it has a circular quality: As noted above, Defendants’ own efforts to mitigate a decline in self-response depend in part on organizations like the NGO Plaintiffs expending resources to counteract such a decline. That is, to the extent that Defendants’ NRFU efforts are successful in any respect, it will be in part because the NGO Plaintiffs have expended resources in aid of those efforts. And in any event, the Court has already found, based on the evidence at trial, that Defendants’ NRFU efforts will not succeed in eliminating a net differential undercount as a result of the citizenship question.
Defendants’ only remaining objection to this theory of injury is without merit. They assert that the NGO Plaintiffs have “not met their burden of proving” a “direct conflict between
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their missions and the reinstatement of a citizenship question on the census.” Defs.’ Post-Trial Br. 40, ¶ 263; see id. at 69-70, ¶ 18. In support of that conclusion, however, they rely on a misreading of the D.C. Circuit’s decision in National Law Center on Homelessness & Poverty v. Kantor, 91 F.3d 178 (D.C. Cir. 1996). In that case, an organization dedicated to helping the homeless asserted Article III standing to challenge an undercount of homeless individuals based on an anticipated injury to the organization’s “purpose of providing accurate information on homelessness and poverty.” Id. at 182. But the D.C. Circuit did not accept that characterization of the organization’s mission; pointing out that the National Law Center was not a “news reporting agency,” the Court observed instead that the “purpose of providing” such “accurate information” was “ancillary to [its] general approach of gaining governmental responses to improve the lot of the homeless.” Id. Given that definition of the organization’s mission, the “indirectness” that the court found to be problematic in that case is easy to see. It is equally easy to see that it is not present here.
More significantly, the D.C. Circuit went on to hold that the connection between the ability to disseminate accurate information about the homeless population and the probability of achieving tangible benefits based on the public’s reaction to that information was “at the far end of speculation” on the factual record before it. Id. Observing that “conjectural” connection, the Court held that it was “[f]or this reason” that the organization’s reliance on Havens Realty was “misplaced” — that is, that the group had simply failed to show, as a factual matter, that “a homeless undercount . . . impose[d] any . . . barriers to either the homeless or their advocates.” Id. (emphasis added); see Am. Soc’y for Prevention of Cruelty to Animals v. Feld Entm’t, 659 F.3d 13, 25 (D.C. Cir. 2011) (construing the “direct conflict” requirement to mean that “[i]f the challenged conduct affects an organization’s activities but is neutral with respect to its substantive mission,” it is “‘entirely speculative’ whether the challenged practice will actually
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impair the organization’s activities”). Here, of course, Plaintiffs have proved, as a factual matter, that Defendants’ conduct will absent an expenditure of resources harm their core missions of advancing the interests, and enhancing the political power, of the communities they serve. There is thus a “direct conflict” between their missions and the conduct they challenge, and they have proved an Article III injury under Havens Realty.
Finally, Plaintiffs have also proved that New York City and Chicago have diverted limited resources towards counteracting the injurious effects of a citizenship question. That forced resource-diversion also qualifies as an Article III injury. It is long settled that a municipality that loses access to resources, thus “threatening its ability to bear the costs of local government and to provide services,” suffers an Article III injury in fact. Gladstone Realtors v. Vill. of Bellwood, 441 U.S. 91, 110-11 (1979). And it is of no import that New York City and Chicago could, theoretically, have foregone any efforts to remedy the harms caused by the citizenship question, as the “forced choice” between risking imminent harm and spending money to avoid it would constitute a cognizable Article III injury all by itself. Cf. Texas, 787 F.3d at 749.
Accordingly, Plaintiffs ADC, MRNY, NYIC, CASA, New York City, and the City of Chicago have each proved that the addition of a citizenship question to the 2020 census questionnaire will cause, and in some instances has already caused, cognizable Article III injury in the form of a diversion of valuable resources.
e. Loss of Privacy
Finally, the Court shares Plaintiffs’ view that any invasion of privacythat would be inflicted by the unlawful disclosure of confidential census data regarding individuals’ citizenship status would, it if were sufficiently imminent, constitute a cognizable Article III injury. A contrary view would fly in the face of “both the common law and the literal understandings of
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privacy,” which “encompass the individual’s control of information concerning his or her person.” U.S. Dep’t of Justice v. Reporters Comm. for Freedom of Press, 489 U.S. 749, 763 (1989). That said, Plaintiffs did not prove that such an injury is sufficiently imminent to satisfy Article III in these cases. As Plaintiffs concede, it would be illegal for the Department of Commerce to “make any publication whereby the data furnished by any particular establishment or individual . . . can be identified.” 13 U.S.C. § 9(a)(2); Pls.’ Proposed Findings ¶ 1722. Consistent with that mandate, Dr. Abowd testified at trial that the Census Bureau will apply “disclosure avoidance techniques” to any data to ensure that information concerning particular respondents is not identifiable. Tr. 1033. To be sure, those techniques may reduce the fitness of the data for DOJ’s purposes — an issue addressed below. And, in theory, the statutory prohibition could be changed by a future Congress. But it is pure speculation to suggest that the Census Bureau will not comply with its legal obligations to ensure the privacy of respondents’ data or that those legal obligations will be amended. And given that, the fact that NGO Plaintiffs may be subjectively fearful that the government will misuse citizenship data obtained through the census, see Pls.’ Proposed Conclusions ¶ 55, however understandable such fears may be, is insufficient to create standing,” Clapper, 566 U.S. at 417. Accordingly, the Court holds that Plaintiffs failed to prove that they have been, or will be, injured for Article III purposes through a loss of privacy.
3. Traceability and Redressability
In short, Plaintiffs proved that some have suffered, or will suffer, injury in fact in at least four ways: (1) diminished political representation, between and within states; (2) reductions in federal funding, again both between and within states; (3) harm to the accuracy and quality of census data; and (4) the diversion of resources. Thus, the Court turns to the second element of
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standing, which requires that Plaintiffs prove a “causal connection” between their injuries and the conduct they challenge in this lawsuit. Lujan, 504 U.S. at 560.
Plaintiffs have done so here. First, the evidence at trial proved beyond any doubt, and certainly by a preponderance of the evidence, that the addition of a citizenship question will cause a disproportionate decline in self-response rates among households containing at least one noncitizen individual and that that, in turn, will force substantially more such households into the Census Bureau’s NRFU process. Right off the bat, that will cause a decline in the accuracy and quality of the data generated by the census, which will injure the Governmental Plaintiffs that rely on that data to make and enforce their laws. On top of that, the Court found, by a preponderance of the evidence, that the decline in self-response will translate into a net differential undercount of people who live in noncitizen households of at least 5.8%. That net differential undercount will, in turn, cause the harms set forth in the prior section of this Opinion. In arguing otherwise, Defendants attack the “traceability” of Plaintiffs’ injuries to the citizenship question in startlingly cursory fashion. After previewing these arguments with such fanfare, see Defs.’ Pre-Trial Br. 6 n.2; see generally id. at 5-20, Defendants devote a scant two paragraphs of their Proposed Conclusions of Law to contesting “traceability” on various grounds, each of which amounts to little more than a conclusory citation to the record, and each of which even lending it the most charitable interpretation, despite Defendants’ near-abandonment of their supporting arguments is ultimately unavailing. See Defs.’ Post-Trial Br. 70-71, ¶¶ 22-23.
The first such ground is the most familiar: Defendants argue that the connection between the citizenship question and Plaintiffs’ injuries is simply too “speculat[ive],” relying on too many “inferences” to satisfy Article III. Post-Trial Br. 67-68, ¶¶ 11-14.53 That argument, however,
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misunderstands both the law and the facts. Courts often dismiss claims for prospective relief because the plaintiffs’ claims that defendants will imminently cause them injury are too “speculative” to satisfy Article III. See, e.g., Clapper, 568 U.S. at 410-14. But, as the term suggests, the bar on “speculative inferences” in the standing analysis refers to speculation and inferences, as opposed to evidence and proof. To be sure, at the pleading stage, a plaintiff must plausibly allege facts connecting his or her injuries to the defendant’s conduct, and cannot substitute “speculative inferences” for plausible factual allegations of causation. See, e.g., Simon v. Eastern Ky. Welfare Rights Organization, 426 U.S. 26, 42-46 (1976) (ordering dismissal of a complaint that failed to allege that plaintiffs’ injuries “in fact result[ed] from” a challenged federal tax incentive through its effect on third parties, rendering it “purely speculative” whether those injuries were fairly traceable to the tax incentive “or instead result[ed] from decisions made” by the third parties “without regard” to the incentive (emphasis added)). But here, with a full trial record, the Court need not speculate: Plaintiffs proved each factual step in the causal chain and that each step is fairly traceable, at least in part, to the addition of a citizenship question. See, e.g., Mendia v. Garcia, 768 F.3d 1009, 1012-13 (9th Cir. 2014) (“[W]hat matters is not the length of the chain of causation, but rather the plausibility of the links that comprise the chain.” (internal quotation marks omitted)). So, while “highly attenuated chain[s] of possibilities” are not enough to survive a motion to dismiss, Clapper, 568 U.S. at 410 (emphasis added), here the Court deals with facts, not possibilities. Because the facts show both that Plaintiffs’ injuries are imminent and fairly traceable to Defendants’ conduct, this is not a case in
federal funding. Defs.’ Post-Trial Br. 67-68, ¶¶ 11-14. But for the Court’s independent obligation to assure itself of its own subject-matter jurisdiction, the Court would deem the objection abandoned as it relates to traceability and perhaps Defendants meant to do just that, given the ultimate weakness of the argument. The Court addresses the “imminence” of Plaintiffs’ injuries in more detail below.
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which “[s]peculative inferences are necessary to connect [Plaintiffs’] injury to the challenged actions of [Defendants].” Simon, 426 U.S. at 45. Indeed, the facts underlying the chain of causation connecting Defendants’ conduct to Plaintiffs’ injuries here is far stronger than those the Supreme Court found sufficient in Davis.
In fact, to the extent that either side in these cases invites the Court to substitute “speculation” for proof, it is Defendants, not Plaintiffs, who do so. Defendants assert that NRFU operations will remedy any decline in the self-response rate attributable to the citizenship question, Defs.’ Post-Trial Br. 16-20, ¶¶ 127-141, but, at the end of the day, they offer little more than a hope and prayer in support of that assertion. As discussed, NRFU operations have historically failed to remedy differential declines in self-response rates. See Recitation of Facts ¶¶ 211, 230. And Defendants offer no evidence in support of their claim that NRFU operations will do so this time; indeed, they have not even determined the imputation formulae that they will use in the 2020 census. See Tr. 1350-51. As a matter of fact, and as discussed at length above, there are several demonstrable reasons to believe that NRFU operations will do a worse job this time around than in past years in addressing any decline in response rate among Hispanic and noncitizen households. Considerable testimony supports the conclusion that NRFU will suffer from many of the same defects as the initial attempts to obtain answers through self- response. Dr. Hillygus testified that “all of the issues . . . with respect to confidentiality concerns associated with the citizenship question that the Census Bureau acknowledges and has shown to have an impact on the self-response, all matter for cooperation with a census enumerator” in NRFU, too. Tr. 97; see id. at 99-100 (discussing the likelihood that confidentiality concerns and the macroenvironment will hamper NRFU efforts more than in previous years). Dr. Barreto’s testimony supports the same conclusion, see Tr. 643-44, and also suggests that attempts to reassure potential NRFU respondents with confidentiality concerns will be disproportionately
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less effective for Hispanic and immigrant populations. Tr. 688. Notably, these opinions were based in part on the Census Bureau’s own conclusions and studies. See Brown Memo at 43 n.60; see also PX-152; PX-662; PX-663. On top of that, it is undisputed that NRFU operations do nothing to address an undercount attributable to households that do self-respond but omit noncitizen members from those responses, Tr. 1309-10, a phenomenon that is substantially likely to rise in direct response to a citizenship question appearing on the census questionnaire, see Recitation of Facts ¶ 214. In short, Plaintiffs proved that they will imminently suffer a variety of harms that are fairly traceable to Secretary Ross’s decision; Defendants’ unsupported assertion that they will cure or mitigate those injuries before they materialize, supported by nothing more than a promise and contradicted by both history and expert testimony about the conditions of the 2020 census — is not enough to render Plaintiffs’ injuries “speculative.” Cf. Duke Power Co. v. Carolina Envtl. Study Grp., Inc., 438 U.S. 59, 78 (1978) (noting, in the context of discussing traceability and redressability, that a plaintiff need not “negate . . . speculative and hypothetical possibilities in order to demonstrate the likely effectiveness of judicial relief”); Cent. Delta Water Agency v. United States, 306 F.3d 938, 950 (9th Cir. 2002) (“It would be inequitable in the extreme for us to permit one party to create a significantly increased risk of harm to another, and then avoid [sic] the aggrieved party from trying to prevent the potential harm because the party that created the risk promises that it will ensure that the harm is avoided[.]”).
Defendants’ second argument — and the one they come closest to abandoning (as it appears only in their proposed findings of fact) is that the decline in self-response rates among Hispanic and noncitizen households is not “fairly traceable” to the addition of a citizenship question alone because it may also be traceable to an alternate cause, namely the “macroenvironment” of fear and distrust of government among the Hispanic and noncitizen
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populations. See Defs.’ Post-Trial Br. 41-42, ¶¶ 272-76. But this is not how the “traceability” requirement works. A plaintiff must “demonstrate a causal nexus between the defendant’s conduct and the injury” to satisfy Article III’s traceability requirement — nothing more. Rothstein, 708 F.3d at 91 (emphasis added). And in these cases, overwhelming evidence (much of it from the Census Bureau itself and Defendants’ own expert witness, Dr. Abowd) supports the Court’s factual finding that Hispanic and noncitizen households will be less likely to respond to the 2020 census questionnaire if it includes such a question. That means that the addition of a citizenship question will obviously — be a “but for” cause of the decline in self-response rates among those communities. It may well be true (and indeed, the trial evidence suggests) that adding a citizenship question in the current “macroenvironment” will lead to a greater decline than it would in another “macroenvironment.” But it would be perverse to suggest that merely because the background context for Secretary Ross’s decision will exacerbate its negative effects, that the decision is somehow not itself a cause of those effects. Even in a dry season, it is fair to trace the fire to the arsonist.
Defendants’ contrary argument — that the decline in self-response will be traceable to the macroenvironment, not the citizenship question implies that Article III permits only one legally responsible cause per injury. But that is not even how the concept of “proximate” cause works, much less how the “fairly traceable” requirement works. An event can have more than one proximate cause, see, e.g., Staub v. Proctor Hospital, 562 U.S. 411, 420 (2011), and each proximate cause need not always even be a sufficient cause.54 And in any event, “proximate cause” is “not a requirement of Article III standing.” Lexmark Int’l, 572 U.S. at 134 n.6. While
54
of the strikeout.” Oral Arg. Tr. 69, No. 16-980, Husted v. A. Philip Randolph Institute (U.S. Jan.
Thus, for example, “[s]trike one, strike two, [and] strike three” are “all proximate causes 10, 2018) (Kagan, J.), available at 2018 WL 353954.
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the fact that there is another cause “of the plaintiff’s injury may foreclose a finding of proximate cause,” it “is not necessarily a basis for finding that the injury is not ‘fairly traceable’ to the acts of the defendant.” Rothstein, 708 F.3d at 92; see also Block, 793 F.2d at 1309. Indeed, the Supreme Court’s cases imply an even more expansive traceability bar than the one Plaintiffs have cleared here: that a defendant’s conduct need only be a “but-for” cause of a plaintiff’s injuries in the sense that its removal from the causal chain, through the relief sought in the action, will be likely to redress the injuries. See Watt v. Energy Action Ed. Foundation, 454 U.S. 151, 161 (1981) (stating that a plaintiff must “show that there is a ‘fairly traceable’ causal connection between the injury it claims and the conduct it challenges, so that if the relief sought is granted, the injury will be redressed” (emphasis added) (citation omitted)); Duke Power Co., 438 U.S. at 74-78 (concluding that an injury “fairly can be traced to the challenged action of the defendant” if it is a “but-for” cause of the injury and thus likely to be redressed by the relief sought (internal quotation marks omitted)).
Next, Defendants make much of the fact that some steps in the causal chains involve the actions of third parties namely, those who choose not to self-respond to the census because of the citizenship question’s presence on the questionnaire. It is certainly true that traceability can be destroyed where the “independent actions of third parties” are responsible for a plaintiff’s injuries. Lujan, 504 U.S. at 562 (emphasis added). But as Justice Alito’s opinion in Davis makes clear, see 554 U.S. at 734-35, where record evidence, statistical analysis, or just plain common sense support a finding, as they do here, that third parties will respond to the challenged government conduct in a predictable way, “traceability” is not defeated. In the words of then- Judge Scalia, “[i]t is impossible to maintain, of course, that there is no standing to sue regarding action of a defendant which harms the plaintiff only through the reaction of third persons.” Block, 793 F.2d at 1309. If Defendants’ argument were true, he continued, it would be “difficult
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to see how libel actions or suits for inducing breach of contract could be brought in federal court” or “how state threats and intimidation directed at the distributors of certain books could confer standing upon the publisher whose sales are affected.” Id. Put simply, the “fairly traceable” standard rules out injuries produced by the “independent choices of third parties” only where those choices are truly “unfettered,” Lujan, 504 U.S. at 562 that is, causally independent from the challenged conduct. Article III “requires no more than de facto causality,” Block, 793 F.2d at 1309, which the presence of third parties in the causal chain does not necessarily undermine, see Glavin v. Clinton, 19 F. Supp. 2d 543, 550 (E.D. Va. 1998) (three- judge court) (permanently and universally enjoining the Secretary of Commerce’s decision to use statistical sampling in enumerating the population for apportionment purposes, despite the presence of third-parties’ “intervening” actions in the chain of causation leading to the plaintiffs’ injuries), aff’d, Dept of Commerce, 525 U.S. 316. The only question is whether, as a matter of fact, Plaintiffs’ injuries are “fairly traceable” up the causal chain to Defendants’ conduct. Here, for the reasons explained above, they are.
Perhaps recognizing the weakness of their general arguments regarding the intervening acts of third parties, Defendants renew an argument that they first pressed in their motion to dismiss: that Plaintiffs cannot prove traceability here because the chain of causation depends on the intervening acts of third parties that are unlawful. See Docket No. 155, at 19-21; Defs.’ Pre- Trial Br. 6 n.2; Tr. 1497, 1503. Defendants’ argument — for which they cite no supporting authority, from the Supreme Court or otherwise may deserve points for creativity, but it gives way under the strain of only a little thought. For one thing, the purpose of standing doctrine is to “ensure[] that courts exercise power that is judicial in nature” — that is, the power to adjudicate “cases” and “controversies” that Article III confers on the judicial branch (and keeps away from the other branches). Gill, 138 S. Ct. at 1930 (internal quotation marks omitted); accord Spokeo
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136 S. Ct. at 1547; see U.S. Const. art. III, § 2. Congress can instruct the courts not to exercise judicial power over certain cases or classes of cases, see, e.g., Patchak v. Zinke, 138 S. Ct. 897, 910 (2018), but it cannot change what the Constitution says the judicial power is. Thus, while declaring one of the intervening steps in a causal chain to be unlawful might affect the underlying merits of a given claim, it would not, and could not, change whether adjudicating that claim qualified as an exercise in the “judicial power” as defined by Article III.
Defendants’ argument appears also to suffer from a common confusion between the standing and merits inquiries, which of course are conceptually distinct. See, e.g., Whitmore v. Arkansas, 495 U.S. 149, 155 (1990) (“Our threshold inquiry into standing in no way depends on the merits of [the plaintiff’s] contention that particular conduct is illegal.” (internal quotation marks omitted)). The question whether Plaintiffs’ injuries are “fairly traceable” to Defendants’ conduct is not a merits inquiry, as for example the question of proximate causation in tort liability would be; with respect to the latter, Defendants would surely have a colorable argument that they should not be held liable in damages for the unlawful intervening actions of another. See Restatement (Second) of Torts § 448 (noting that, absent certain circumstances, “[t]he act of a third person in committing an intentional tort or crime is a superseding cause of harm to another resulting therefrom”). But nobody is suggesting that Defendants should share in the criminal (or civil) liability that people who fail to respond to the census may incur. Cf. Block, 793 F.2d at 1309 (“That argument could be relevant to the merits of a tort action seeking to hold the government liable for damages as the legal cause of [the plaintiff’s] injury; but it is irrelevant to the question of core, constitutional injury-in-fact, which requires no more than de facto causality.”). The Article III standing inquiry is entirely different: It looks to the chain of causation connecting Defendants’ conduct to Plaintiffs’ injuries, and it asks whether Plaintiffs have shown that one is sufficiently traceable to the other so as to give Plaintiffs a sufficiently
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“personal stake” in the outcome of their challenge to create the adverseness required by Article III. Here, Plaintiffs have plainly made that showing.
Given the foregoing, it is not surprising that Defendants fail to cite any authority in support of their novel argument. Perhaps more surprising is the ample authority that contradicts their argument that they simply ignore. Thus, for instance, courts have found, in data breach cases, that customers have standing to bring claims against the companies that failed to safeguard their data — even though the hacker or “thief would be the most immediate cause of plaintiffs’ injuries.” Attias v. Carefirst, Inc., 865 F.3d 620, 629 (D.C. Cir. 2017), cert. denied, 138 S. Ct. 981 (2018); Galaria v. Nationwide Mut. Ins. Co., 663 F. App’x 384, 390 (6th Cir. 2016) (“Although hackers are the direct cause of Plaintiffs’ injuries, the hackers were able to access Plaintiffs’ data only because Nationwide allegedly failed to secure the sensitive personal information entrusted to its custody.”); Lambert v. Hartman, 517 F.3d 433, 437-38 (6th Cir. 2008) (rejecting the argument that the intervening “criminal act of a third party” defeated standing where the plaintiff “link[ed] the act of identity theft” to the personal information divulged by the defendant). So too, in terrorist financing cases, courts have found standing even though the most immediate cause of injury is the terrorist, not the bank or financier. See, e.g., Rothstein, 708 F.3d at 93 (“[W]e cannot conclude that the Complaint failed to allege sufficiently that plaintiffs’ injuries in bombings and rocket attacks conducted by Hizbollah and Hamas were fairly traceable to UBS’s provision of U.S. currency to Iran.”); Goldberg v. UBS AG, 660 F. Supp. 2d 410, 417 (E.D.N.Y. 2009) (“Here, while a number of independent third parties were involved in the attack on Bus 19, plaintiffs have alleged a coherent and plausible causal nexus linking UBS’s alleged wire transfers for ASP to the bombing of Bus 19.”); accord Wultz v. Islamic Republic of Iran, 755 F. Supp. 2d 1, 23 (D.D.C. 2010); cf. Mendia, 768 F.3d at 1013 (describing the plaintiff’s theory of traceability, that “the government’s unlawful conduct,
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while not directly causing his injury, nonetheless led third parties to act in a way that injured him,” as “perfectly viable”). Most relevant for present purposes, Defendants’ argument is incompatible with the many decisions, most notably the Second Circuit’s decision in Carey, holding that “citizens who challenge a census undercount on the basis, inter alia, that improper enumeration will result in a loss of funds to their city have established . . . an injury fairly traceable to the Census Bureau.” Carey, 637 F.2d at 838; accord City of Detroit, 4 F.3d at 1375; City of Philadelphia, 503 F. Supp. at 671; City of Camden, 466 F. Supp. at 50.
Those basic standing principles are enough to turn away Defendants’ arguments against traceability here. The touchstone of any Article III standing injury is whether the plaintiff has suffered, or is likely to suffer, an injury that is fairly traceable to the challenged conduct and redressable by the relief sought. Although congressional action can obviously affect whether particular injuries are “redressable” by creating (or not creating) causes of action, the “injury in fact” and “traceability” inquiries are fundamentally practical inquiries, grounded in the real- world consequences of human interaction — the sorts of things that give rise to “concrete and particularized” injuries that give plaintiffs a “personal stake” in federal litigation. In both cases, Article III demands something less than an ultimate merits inquiry might require: only that the defendant’s conduct was a de facto cause of the plaintiff’s injury, not that it was the “legal” or “proximate” cause. Block, 793 F.2d at 1309. Thus, while all three strikes are proximate causes of the strikeout, the last domino to fall is fairly traceable to the first. On Defendants’ theory of traceability, Congress could abrogate standing to sue for that last domino falling by declaring it unlawful for the intervening dominoes to fall. But an injury’s traceability for purposes of Article III like Plaintiffs’ injuries here — does not depend on whether the dominoes have congressional permission to fall; it depends only on whether, in fact, they will. Taking a practical look at the facts of these cases, the Court would have no trouble concluding that the
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apportionment losses, funding losses, and harms to data quality that Plaintiffs have proved were proximately caused by Secretary Ross’s decision. It is even easier to conclude, as the Court does, that Plaintiffs’ injuries are fairly traceable to that decision.
That leaves only the element of redressability. Conspicuously, Defendants make no argument whatsoever concerning redressability a tell, if there ever was one, that their arguments about traceability are themselves ultimately lacking. See, e.g., Watt, 454 U.S. at 161 (stating that a plaintiff must “show that there is a ‘fairly traceable’ causal connection between the injury it claims and the conduct it challenges, so that if the relief sought is granted, the injury will be redressed” (emphasis added) (citation omitted)). In any event, given the Court’s findings of fact and conclusions of law, it follows that Plaintiffs have proved that their injuries are “likely” to “be redressed by a favorable decision.” Lujan, 504 U.S. at 561 (internal quotation marks omitted). That is, if Secretary Ross’s decision to add a citizenship question to the 2020 census is set aside or enjoined, as Plaintiffs request in these cases and as the Court concludes it must be, it is likely that its effects on the net differential undercount will be mitigated to the point of relieving Plaintiffs’ injuries. Notably, to satisfy Article III’s redressability requirement, a plaintiff must show that the requested relief will remedy “an injury” to the plaintiff, not “every injury.” Larson v. Valente, 456 U.S. 228, 243 n.15 (1982). And here, although the data generated by the 2020 census may still be less than perfect (no census is perfect, after all), and the resulting political apportionment and funding allocations may not be accurate to the seat or dollar, Plaintiffs have proved that their injuries specifically caused by the citizenship question will be mitigated, if not wholly remedied, by its removal.

RIPENESS
For the foregoing reasons, the Court concludes that most, if not all, Plaintiffs have standing to bring the claims pressed here well more than the one Plaintiff with standing that
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the Court would need for jurisdiction.

* * * *
There is no dispute that the Constitution, the Census Act, and the APA allow the Secretary of Commerce broad discretion over the design and administration of the decennial census. See Wisconsin, 517 U.S. at 18-20. Generally speaking, they do not preclude the Secretary from charting a new policy direction, even over the strenuous objections of career staff, or from recruiting other government officials to support such a change. Significantly, however, the discretion that they allow the Secretary is not unlimited. He must comply with the policy decisions that Congress — to which the Constitution gives authority over the census — has made and enshrined in statute, including but not limited to the preference for obtaining data through administrative records rather than through direct inquiries. He must follow the procedures mandated by law. And more broadly, the exercise of his statutory authority must “be reasonable and reasonably explained.” Mfrs. Ry. Co., 676 F.3d at 1096.

Measured against these standards, Secretary Ross’s decision to add a citizenship question to the 2020 census — even if it did not violate the Constitution itself — was unlawful for a multitude of independent reasons and must be set aside. To conclude otherwise and let Secretary Ross’s decision stand would undermine the proposition — central to the rule of law — that ours is a “government of laws, and not of men.” John Adams, Novanglus Papers, No. 7 (1775). And it would do so with respect to what Congress itself has described as “one of the most critical constitutional functions our Federal Government performs.” 1998 Appropriations Act,
§ 209(a)(5), 111 Stat. at 2480-81.

Accordingly, and for the reasons stated at length above, the Court vacates Secretary Ross’s decision to add a citizenship question to the 2020 census questionnaire, enjoins Defendants from implementing Secretary Ross’s March, 26, 2018 decision or from adding a question to the 2020 census questionnaire without curing the legal defects identified in this Opinion, and remands the matter to the Secretary of Commerce (to the extent that such a “remand” is even necessary) for further proceedings not inconsistent with the Court’s Order. (Opinion, pp. 276-277)


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Judge rejects citizenship question for 2020 U.S. census
Nick Brown, Jonathan Stempel


5 Min Read

U.S. District Judge Jesse Furman in Manhattan said Commerce Secretary Wilbur Ross concealed his true motives in adding the question last March.

Ross had said the question - which has not appeared on the decennial census since 1950 - was necessary to enforce federal laws protecting eligible voters.

Furman’s decision will almost certainly be appealed, and could wind up before the Supreme Court this year.

The plaintiffs - 18 U.S. states, 15 cities and various civil rights groups - said that asking census respondents whether they are U.S. citizens will frighten immigrants and Latinos into abstaining from the count.

That could cost their mostly Democratic-leaning communities representation in the U.S. House of Representatives, as well as their share of some $800 billion a year in federal funding.

The plaintiffs alleged that was Ross’ plan all along, while he insisted the government needed citizenship data to better enforce the Voting Rights Act, which protects eligible voters from discrimination. Only American citizens can vote in federal elections.

Dale Ho, an attorney with the American Civil Liberties Union who argued the plaintiffs’ case, called Furman’s ruling “a forceful rebuke of the Trump administration’s attempt to weaponize the census.”

Kelly Laco, a Justice Department spokeswoman, said the administration was “disappointed,” adding that the “government is legally entitled to include a citizenship question on the census, and people in the United States have a legal obligation to answer.”

In a 277-page opinion, Furman called Ross’ Voting Rights Act rationale “pretextual.”

“He announced his decision in a manner that concealed its true basis rather than explaining it,” Furman said.

Ross said he added the question at the request of the Justice Department, but evidence at trial showed he independently pushed for it much earlier.

Ross also chose not to heed recommendations from experts - including from within the Census Bureau itself - who said adding the question would lead to an undercount and hurt data quality.

During a two-week trial in November, Justice Department lawyers argued Ross need not reveal every motivating factor, as long as his stated rationale was sound.

They also said he was under no obligation to take advice from experts. Ross “doesn’t have to choose the best option” as long as he considers all evidence in good faith, Justice Department lawyer Brett Shumate said at trial.

But Furman said Ross and his aides behaved “like people with something to hide,” leading to the “inescapable” conclusion that they “did have something to hide.”
NEXT STEPS

The ruling means the Trump administration will have to keep litigating if it wants to preserve what has become one of the most controversial of its hawkish immigration policies.

Furman’s ruling bars Ross from re-adding the question unless he “cures the legal defects” in his rationale.

The case is thought likely to wind up before the Supreme Court, but time is short: the Census Bureau must print census forms sometime this spring.

Congress could also ban the question, which would eliminate the need for litigation. Democratic lawmakers have said they plan to use their newfound majority in the House to investigate the question.

Census consultant Terri Ann Lowenthal, a former staff director of the House census oversight subcommittee, said “lawmakers should overturn Secretary Ross’ decision, which the court correctly ruled was made in violation of legal requirements.”

Furman’s ruling muddies a census that is already among the most complicated and expensive in U.S. history.

The first-ever online census, set for April 2020, has been plagued by delays, missed deadlines and the cancellation of key tests, partly from legacy underfunding from Congress.

At least five other lawsuits seeking to quash the citizenship question remain pending.

Some advocates worry it may be too late to assuage the fears of immigrants in a climate of heightened immigration rhetoric.

“Hopefully a lot of damage hasn’t already been done, and immigrant communities ... will still come to the door when the census takers come,” said Doug Rand, a former Obama White House official who worked on immigration issues.


Reporting by Nick Brown and Jonathan Stempel in New York; additional reporting by Mica Rosenberg; Editing by Chizu Nomiyama and Jonathan Oatis
Our Standards:The Thomson Reuters Trust Principles.


The Norwegian Pension Fund Global: On the Emerging Global Expectations of Monitoring Within Production Chains

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On 6 June 2018, the Council on Ethics recommended to exclude the company Texwinca Holdings Ltd from the Government Pension Fund due to an unacceptable risk of the company being responsible for systematic human rights violations.
Texwinca is a Chinese company that produces yarn, knitted fabrics and garments. Texwinca owns 50 per cent of the shares in Megawell Industrial Ltd, making it that company’s largest shareholder. Texwinca has had the same shareholding in Megawell for more than 20 years. Megawell owns the garment factories Hugo Knit and Kollan in Vietnam as wholly owned subsidiaries. Texwinca states that it does not have a controlling influence over Megawell, and that it has no responsibility for the working conditions at the factories in Vietnam. (Press Release)
On 17 January 2019, Norges Bank accepted the recommendation of the Council on Ethics (Press Release here).  The Norges Bank also announced the exclusion of  Evergy Inc and Washington H. Soul Pattinson & Co Ltd.  based on their application of the Pension Fund Global's product-based coal criterion. The Executive Board also concluded that it was not appropriate to use other measures in these cases--and specifically either observation or shareholder engagement.

The Council’s recommendation to exclude the company Texwinca Holdings Co has been made public today and follows below along with brief comments.



It was not very long ago that enterprises understood contracts, and contract relationships, as relatively straightforward instruments.  In its ideal form, one autonomous enterprise typically would exchange something of value (usually money or its equivalent) for some of object of value (usually a product of some kind, though also services) with another  autonomous enterprise. Privileged within that relationship, and at the heart of contract, was the notion of autonomy; that one contracted for things in exchange for value. With respect to the means deployed to produce the objects subject to exchange, neither company would expect to have a responsibility for the conduct of the other.  Such conduct was expected to comply with law and it was left to the state and its domestic legal order to deal with those issues.  

But much has changed. Increasingly, and certainly within the societal sphere, the transformation of expectations appears to have reduced the autonomy of firms in their inter-relationships. Increasingly, the firms appear to have been vested with a growing responsibility not just with respect to the quality and value of their direct exchanges, but also with respect to the means by which such exchanges are actually produced.  That change in corporate culture coincides with the quite dramatic development of expectations of corporate social responsibility in areas of sustainability and human rights, including labor rights, grounded in the development of increasingly comprehensive normative structures developed by international private and public organizations, the history and content of which is well known. Those core changes in the cultural presumptions about the division of responsibility in the context of economic activity, and its effect on the primacy of institutional autonomy has affected the character of both contractual and ownership relations. 

All of this is well known in theory and among those involved in this field. But disciplinary measures are becoming more transparent as societal actors--principally consumers and investors--and sovereign actors in private markets especially, become better at institutionalizing measures for shaping their own economic choices in conformity to these changing expectations.  As a consequence, the societal expectations around business activity will likely shape more and more erode the effective protection of the principles of institutional and contract autonomy. In its place, the rise of socially constructed regimes of mutual accountability and responsibility will increasingly reshape the understanding of the character and limits of institutional autonomy and of the scope of responsibility in contractual relations. It is in this way that societal expectations will transform the meaning and application of legal regimes of corporate and contract law--eventually.

The Norwegian Pension Fund Global among others, of course, has been a driving force.  It is a curious hybrid.  It represents the organization of state power for the purpose of its projection through private economic activity, once removed.  It is once removed int h sense that regulatory management is achieved through influence in financial markets and through shareholder activism, rather than through the formal structures of domestic or international law. All of this is also well known (e.g., here, here, and here). But the power of these societal efforts becomes clear from time to time as these societal and hybrid institutions flex their (private) muscle to further (domestic) public objectives (e.g., here).

It is for that reason that the exclusion of  Texwinca Holdings Ltd from the Government Pension Fund due to an unacceptable risk of the company being responsible for systematic human rights violations is particularly interesting. Here is a case in which the Chinese enterprise sought refuge in the old and once quite powerful principles of corporate autonomy, with its presumptions that while enterprises are responsible for their own misconduct--whether in breach of legal obligation or societal expectations--there is a presumption against the projection of those responsibilities (and their consequences) to other enterprises, even when they hold a controlling interest. To that end, the traditional principles of agency and veil piercing served to embed the principle of enterprise autonomy in law.

But the Texwinca exclusion suggests that in the context of societally constructed regimes of responsibility, the presumption of autonomy has been replaced by a presumption of responsibility. Though in law, Texwinca may have owed no duty to thew workers of the subsidiaries of an enterprises in which Texwinca appeared to have a controlling equity interest (in the absence of veil piercing or the application of the principles of master and servant), the Norwegian Ethics Council determined that societal norms imposed on Texwinca a responsibility to oversee (and to manage or correct--mitigate sometimes in the language of the standards) breaches of national law and international norms downstream in its supply chain. All this is also well known.

More interesting, though, in its analysis, is the possibility of a divergence in the development of agency and veil piercing principles applicable in societally based governance systems from those developed within domestic legal orders.  In law, veil piercing principles tend to be narrowly applied, based on the presumption of enterprise autonomy. Likewise agency principles tend to be narrowly applied on the  same basis.  In both cases there is a presumption of a need for a strong evidentiary showing both of bad motive and of a course of action that makes it clear that the autonomy of the enterprises or of the relationship at the root of contract, ought to be disregarded. But the Ethics Council appears to have reversed the presumptions.
The Council does not know which agreements in law have been entered into between the companies, but considers that Texwinca’s dominant shareholding, combined with the fact that Texwinca’s top managers have held senior positions at Megawell for more than 20 years, indicates that Texwinca does indeed have a significant influence over Megawell.

Because of the company’s ownership structure, the Council considers norm violations at Kollan and Hugo Knit to be norm violations in Texwinca’s own operations. The Council takes the position that, with respect to norm violations perpetrated within a company’s own operations, the threshold for what can be accepted must be lower than when a company contributes to norm violations perpetrated by a third party. (Ethics Council Recommendation)
The Ethics Council thus appears to be working toward the construction of a set of rules of responsibility grounded in the presumption of shared responsibility which is triggered by notions of control.  Control is broadly construed in favor of shared responsibility and the principle of autonomy recedes. The same would likely apply in the related context of agency grounded in comprehensive contractual relations (output contracts for example). Yet as the legal regimes of states and the governance regimes international standards applied by actors in markets diverge, the problem of regulatory coherence will become more important--and more complex. 

This conclusion should not be read as criticism.  But it does suggest a potential growing dissonance between the development of standards and presumptions of conduct, of responsibility, and of liability within the societal sphere, and those developed within the domestic legal orders of many states. To that extent, companies must begin to understand that legal compliance is itself only the first stage in any effective compliance regime.  The varying standards of compliance with societal expectations may point corporate action in different direction.  More importantly, perhaps, it will augment the role of risk management in corporate social responsibility (including sustainability, human rights, and labor norms).   









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To Norges Bank
5 June 2018
Recommendation to exclude Texwinca Holdings Ltd from the Government Pension Fund Global (GPFG)
Summary

The Council on Ethics recommends that Texwinca Holdings Ltd be excluded from investment by the Government Pension Fund Global (GPFG) due to an unacceptable risk that the company is responsible for systematic human rights violations.
Texwinca is a Chinese company that produces yarn, knitted fabrics and garments, and has its own retail division in China. Texwinca owns 50 per cent of the shares in Megawell Industrial Ltd (Megawell), making it that company’s largest shareholder. Megawell owns the garment factories Hugo Knit and Kollan in Vietnam as wholly owned subsidiaries. Texwinca states that it does not have a controlling influence over Megawell and that the company’s strategy is to remain a passive shareholder.
The Council on Ethics has assessed the risk that Texwinca contributes to or is itself responsible for systematic violations of internationally recognised human rights and labour rights. The company’s corporate ownership structure has led the Council to conclude that norm violations at Kollan and Hugo Knit constitute norm violations in Texwinca’s own operations. The Council’s assessment rests on investigations into working conditions at Megawell’s factories in Vietnam.
To qualify as systematic, the human rights violations must be substantial in scope, ie that they are numerous in quantity, that different types of rights are infringed or that abuses take place in many entities within the company. The Council takes the position that “systematic” requires an accumulation of such violations and not merely isolated incidents; in other words that they constitute a pattern of behaviour. Furthermore, in its capacity as employer, each company has an individual and direct responsibility for its workforce and for preventing their employees’ labour rights from being infringed. The Council takes the position that, with respect to norm violations perpetrated within a company’s own operations, the threshold for what can be accepted must be lower than when a company contributes to norm violations perpetrated by a third party.
In its assessment of the risk of future human rights violations, the Council attaches importance to how a company has responded when norm violations have been uncovered, and what it has done to prevent their reoccurrence.
The Council’s investigations point to a working environment at Kollan and Hugo Knit that may be harmful to employees’ health. Employees at both factories have reported substantial overtime, high production quotas, high indoor temperatures and widespread harassment and abuse by supervisory staff, which, at Kollan, is said to have contributed to employees fainting at their posts. Employees also report violations of fire safety regulations and restrictions on bathroom breaks, and say that legitimate sick leave is penalised through wage deductions and that the company, in practice, forces people to work overtime. Other norm violations relate to discrimination, in that female workers do not have their contracts renewed if they become pregnant, and restrictions on freedom of association, since management representatives run the trade unions at the factories. The Council finds it substantiated that the company’s practices in many areas contravene both internationally recognised labour rights and national legislation.
The Council attaches importance to the fact that Texwinca has not helped to clarify this matter. The company has provided limited information about its relationship with Megawell, has not allowed the factory to be inspected and has failed to make any comment on draft recommendations to exclude the company from the GPFG. Texwinca argues that conditions at the factories of which it is the principal shareholder are none of its business. The Council therefore has access to less information in this case than in other similar cases it has assessed.
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The information deficit also relates to the scale of norm violations and what the company is doing to prevent them. In accordance with the wording of Report No. 20 (2008–2009) to the Norwegian Storting (parliament), the Council on Ethics has concluded that a lack of information on the company’s conduct and, not least, a lack of willingness on the part of the company to provide information may, in and of itself, add to the risk of contributing to unethical behaviour being deemed unacceptably high.
Texwinca has had the same position as Megawell’s major shareholder for more than 20 years and presents Megawell as part of its corporate structure. Texwinca’s dominant shareholding, combined with the fact that several individuals have been members of the boards and managements of both companies for many years, causes the Council to presume that Texwinca’s management is aware of and has accepted the working conditions at Megawell’s factories in Vietnam. Neither Texwinca nor Megawell have disclosed what the companies are doing to improve those working conditions, nor have they indicated any commitment to preventing labour rights violations at the factories in Vietnam. When Texwinca claims that it has no influence over manufacturing operations in Vietnam, and Megawell does not publish any information about its business, it is natural for the Council to draw the conclusion that neither Texwinca nor Megawell are taking any responsibility for the prevention of human rights violations at the factories in Vietnam. The Council on Ethics considers that when a company in this way disclaims responsibility for preventing norm violation and fails to provide information about conditions or its own initiatives in its operations, the risk of systematic labour rights violations becomes unacceptably high.
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Table of contents
1 Introduction 1
1.1 Matters considered by the Council 1 1.2 Sources 3
  1. 2  Texwinca and Megawell in brief 3
  2. 3  Investigations into working conditions at Kollan and Hugo Knit 4
    1. 3.1  Forced overtime 4
    2. 3.2  No wage increases, wage deductions and restrictions on sick leave 5
    3. 3.3  Occupational health and safety 6
    4. 3.4  Discrimination 7
    5. 3.5  Freedom of association 8
  3. 4  Information provided by the company 8
    1. 4.1  The Council’s contacts with Texwinca 8
    2. 4.2  Texwinca’s policies at its factories in China 9
  4. 5  The Council on Ethics’ assessment 9
  5. 6  Recommendation 11
1
1 Introduction
After numerous serious accidents and reports of poor working conditions in certain countries’ textiles industries, the Council on Ethics began a series of investigations into working conditions at textiles factories in countries where the incidence of labour rights violations is presumed to be particularly large. Texwinca Holdings Ltd (Texwinca) 1 is one of the companies that has been investigated.
Texwinca produces yarn, knitted fabrics and garments, and has its own retail division in China. Texwinca has around 15,000 employees in China and produces for fashion brands in the USA, Europe and Asia.2 Texwinca has a 50 per cent stake in Megawell Industrial Ltd (Megawell), making it the company’s largest shareholder. Megawell owns garment factories in Vietnam (Hugo Knit and Kollan Vietnam) and China. Hugo Knit and Kollan are wholly owned subsidiaries of Megawell. 3
Texwinca is listed on the Hong Kong Stock Exchange. At the close of 2017, the GPFG owned 1.01 per cent of the company’s shares, with a market value of just over NOK 63 million.
1.1 Matters considered by the Council
The Council on Ethics has considered whether there is an unacceptable risk that Texwinca may “contribute to or are responsible for serious or systematic human rights violations” as set out in the Guidelines for Observation and Exclusion from the Government Pension Fund Global (ethical guidelines).4 The Council’s assessment builds largely on the result of investigations into working conditions at Megawell’s factories in Vietnam.
The Council bases its assessment of what constitutes serious or systematic violations on internationally recognised conventions and authoritative interpretations thereof. Of particular relevance in this case are the labour rights encompassed by articles 23 and 24 of the UN’s Universal Declaration of Human Rights, and set out in article 7 of the International Covenant on Economic, Social and Cultural Rights (ICESCR), whose provisions include the right to a fair wage, safe and healthy working conditions, the reasonable limitation of working hours, periodic holidays with pay and equal opportunities. The Committee on Economic, Social and Cultural Rights (CESCR) has elaborated on how article 7 should be interpreted, and has made it clear that health, safety and the environment are fundamental elements in the right to safe and healthy working conditions.5 Article 8 of the ICESCR encompasses the right to form trades unions and join the trades union of one’s choice, and the right to strike. In addition, the ILO’s core conventions lay down minimum standards for several areas of working life,
1 Issuer Id: 116568
2 Texwinca Holdings Ltd. “Group History,” http://www.texwinca.com/hist.asp
3 Texwinca Holdings Ltd. “Group Structure” http://www.texwinca.com/struct.asp.
4 Guidelines for Observation and Exclusion from the Government Pension Fund Global (GPFG),
https://lovdata.no/dokument/INS/forskrift/2014-12-18-1793?q=retningslinjer+++pensjonsfond+++utland. 5 The UN Committee on Economic, Social and Cultural Rights (CESCR) is an independent committee of experts, which monitors states’ implementation of the International Covenant on Economic, Social and
Cultural Rights (ICESCR), http://www.ohchr.org/EN/HRBodies/CESCR/Pages/CESCRIntro.aspx. In April 2016, the committee published “General comment No. 23 (2016) on the right to just and favourable conditions of work (article 7 of the International Covenant on Economic, Social and Cultural Rights)”, in which it elaborated in more detail how article 7 should be interpreted, see https://documents-dds- ny.un.org/doc/UNDOC/GEN/G16/087/51/PDF/G1608751.pdf?OpenElement
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including freedom of association6 and equal pay.7 Conventions covering occupational safety and health are also relevant.8
Although international human rights conventions bind states not companies, companies can be said to contribute to human rights violations. The Council on Ethics takes no position on the extent to which the state is responsible for any human rights violations that may occur. It is sufficient to establish that the company in question acts in a way that contributes to serious or systematic violation of internationally recognised human rights.9 This applies irrespective of whether the state in which the violations take place has signed the conventions against which the actions are assessed.
When assessing the violation of human and labour rights in a company’s own operations, the Council takes the position that employers have a direct responsibility for their workforce and for preventing the infringement of their employees’ labour rights. In this case, Texwinca’s ownership structure has led the Council to consider the norm violations to be norm violations at the company’s own operations. The Council has considered whether conditions at Texwinca’s factories must be deemed to constitute systematic human rights violations pursuant to the GPFG’s guidelines. The Council has previously taken the position that a small number of human rights violations may be sufficient for a company to be excluded from the GPFG if the abuses are of a serious nature. On the other hand, individual violations do not need to be as serious if the abuse is systematic.10
To qualify as systematic, the human rights violations must be substantial in scope. This could mean that they are numerous in quantity, that different types of rights are infringed or that abuses take place in many entities within the company. The Council takes the position that “systematic” requires an accumulation of such violations and not merely isolated incidents; in other words that they constitute a pattern of behaviour. In previous recommendations, the Council has attached importance to the existence of a “systematic and planned practice on the part of the company to operate at, or beyond, the boundaries of what are accepted standards for the working environment”.11
With regard to assessing the risk of new human rights violations occurring in a company’s own operations, the Council holds the view that previous norm violations could provide an indication of future patterns of behaviour. The Council attaches importance to how a company has responded when norm violations have been uncovered, and what it has done to prevent their reoccurrence. The UN Guiding Principles on Business and Human Rights articulates an expectation that companies will respect human rights, prevent the risk of their abuse and take action to remedy any human rights violations that do occur.12 The company has a duty to comply with national legislation and norms even when these are not enforced by the authorities. It is expected that a company assess the actual and potential negative impacts that its operations have on those affected by them, and demonstrate that it has strategies and procedures in place that help to prevent human rights violations. Companies must also consider whether the measures implemented are effective, and make whatever changes are necessary to prevent violations happening again. The company must also publish details of
6 ILO Conventions 87 and 98.
7 ILO Conventions 100 and 111.
8 Inter alia, ILO Convention 155 on Occupational Safety and Health.
9 This is discussed in more detail in the Council on Ethics’ recommendation to exclude Wal-Mart Stores Inc,
section 3.2, 15 November 2005, see www.etikkradet.no
10 Council on Ethics recommendation to exclude Total SA, section 3.1
11 Council on Ethics recommendation to exclude Wal-Mart Stores Inc, p. 21. 12 UN Guiding Principles on Business and Human Rights:
http://www.ohchr.org/Documents/Publications/GuidingPrinciplesBusinessHR_EN.pdf
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what it is doing to prevent human rights violations in its own operations. The Council on Ethics takes the position that it is up to the company concerned to substantiate that it is working adequately to prevent human rights violations.
Furthermore, any assessment of future risk may be affected by the availability of information on the company’s conduct. In Report (white paper) No. 20 (2008–2009) to the Norwegian Storting (parliament), the Ministry of Finance underlines that “a lack of information may affect any assessment of the extent to which there is an unacceptable risk of complicity.13 If it is, in reality, not possible to obtain sufficient information to assess the risk of norm violations, this could, given the circumstances, be perceived in and of itself as taking an unacceptable risk.” In cases where there are clear indications that a company is responsible for or contributes to serious or systematic human rights violations, the Council on Ethics will, in compliance with this report to the Storting, consider that inadequate information about a company’s conduct could contribute to the risk of complicity in unethical conduct being deemed unacceptably high. A lack of willingness on the part of the company to provide information will be a material factor in any such assessment.
1.2 Sources
The Council on Ethics has looked at two of Megawell’s factories in Vietnam. Hugo Knit was investigated in the spring of 2016 and Kollan in the summer of 2017. The investigations were carried out with the help of consultants and are based on interviews with factory employees outside their place of work.
Texwinca declined the Council’s request for permission to inspect Hugo Knit in November 2015. Texwinca has declined to comment on two draft recommendations issued by the Council and the company has failed to provide any information about working conditions at the factories in Vietnam.
2 Texwinca and Megawell in brief
Texwinca’s founder, chairman and now executive director bought Megawell in 1989.14 In 1997, a wholly owned subsidiary of Texwinca bought 50 per cent of the shares in Megawell. Two people own shareholdings in Megawell of 25 per cent each.15
Texwinca’s chairman is also a director of Megawell, a position he has held since 1989.16 He describes himself as: “supreme authority in and ultimate control of the companies and the Texwinca Group”.17 Other members of his family, including his brother, have been members of Texwinca’s executive management and board of directors18 while also being directors at
13 Report (white paper) No. 20 (2008-2009) to the Storting On management of the Government Pension Fund Global (GPFG) in 2008.
14 Texwinca’s founder and chairman was also the company’s CEO until 2013. After 2013, he became an executive director.
15 Email from Texwinca to the Council on Ethics, 1.11.2015 and Li Tin Sang V. Poon Bun Chak, Poon Kit Ho and Perfection Inc in the High Court of Hong Kong, https://www.hongkongcaselaw.com/li-tin-sang-v-poon- bun-chak-and-others-2/.
16 Megawell’s report to the companies register in Hong Kong 1989-2017, https://www.cr.gov.hk/en/home/index.htm.
17 Li Tin Sang V. Poon Bun Chak, Poon Kit Ho and Perfection Inc in the High Court of Hong Kong, para 56. 18 Texwinca’s annual reports 1998-2017.
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Megawell.19 One of his sons, who has been a director at Megawell since 2015,20 was also appointed Executive Director and made a member of Texwinca’s board in 2017.21
Texwinca’s 1998 annual report describes Megawell as “the Group's garment manufacturing operations”.22 Subsequent annual reports describe Megawell as a “material associate and strategic partner”.23 Texwinca’s shareholding has remained unchanged since 1997. According to an overview of Texwinca’s corporate structure published on its website, Megawell is included as a unit within the group.24 Texwinca is both Megawell’s most important customer and most important supplier.25

3 Investigations into working conditions at Kollan and Hugo Knit
The garment factories Kollan and Hugo Knit are both located in the Linh Trung Export Processing Zone, in the Thu Duc district on the outskirts of Ho Chi Minh City. In October 2015, Kollan had around 2,000 employees, while Hugo Knit had a workforce of 1,350.26
Vietnam’s Labour Code from 2012 and associated statutory instruments,27 including the Labour Hygiene Standards from 2012)28 regulate working conditions and labour rights in accordance with international covenants and conventions. The law contains detailed provisions relating to employers’ obligations to their workers, including those covering occupational health, safety and the environment (HSE).

3.1 Involuntary overtime
The right to rest, leisure time and a reasonable limit to working hours is set out in the International Covenant on Economic, Social and Cultural Rights (Article 7d). This is further defined in a number of ILO conventions,29 including convention no. 1, which sets out the principle of an eight-hour working day and a 48-hour working week as the maximum permitted working time. Working hours are similarly regulated in Vietnam’s Labour Code, though this caps permitted overtime at 300 hours per year, 30 hours per month and 12 hours per week.30 Under Vietnam’s Labour Code, all overtime must be voluntary.31   
 Employees at Kollan reported that they normally worked a 60-hour week, of which 12 hours was overtime. Over the course of a month, this adds up to 48 hours; and over a year to more

19 See footnote 16.
20 See footnote 16.
21 Texwinca Holdings Ltd, Appointment of Executive Director 29.9.2017. Announcement to the Hong Kong
Stock Exchange.
22 Texwinca Annual Report 1998, http://www.irasia.com/listco/hk/texwinca/annual/index.htm 23 Texwinca Annual Report 2017, http://www.irasia.com/listco/hk/texwinca/annual/ar177798-
e00321_ar_0705_0340.pdf
24 Texwinca Group Structure, http://www.texwinca.com/struct.asp
25 Factset: Texwinca Holdings Ltd
26 Social Insurance Bureau, Social Insurance payment summary for Kollan and Hugo Knit. Newer figures have
not been made available to the Council on Ethics.
27 Labour Code of June 18, 2012, Law 10-2012-QH13 (“Labour Code”), for the English translation, see
https://www.ilo.org/dyn/natlex/docs/MONOGRAPH/91650/114939/F224084256/VNM91650.pdf.
28 Ministry of Health, Labour Hygiene Standards (Oct. 10, 2012).
29 A total of 22 ILO conventions have been adopted, 18 recommendations and a protocol on working hours.
These include ILO conventions no. 1 on working hours, no. 14 on a weekly day of rest and no. 132 on paid
holidays.
30 Labour Code, Article 69, Decree 109/2002/NĐ-CP, Article 1 (C) 3 Circular 15/2003/TTBLĐTBXH, § II (1.2) 31 Labour Code, Article 106 re Overtime work (2).


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than 500 hours of overtime. The employees’ payslips showed that some employees had
worked 55 hours overtime during a month. At Hugo Knit, too, employers reported a lot ofovertime, saying that they normally worked 13.5 hours of overtime per week. Over the course of a month this adds up to 65 hours, corresponding to 775 hours of overtime per year. The use of overtime at both factories is higher than permitted.
Employees at both factories said it could be difficult to refuse to work overtime. Kollan
employees said they had to get permission from a supervisor to avoid overtime. While somesaid it was easy to avoid, others said they were pressured into working overtime. Employees also said that the factory had no system for recording whether overtime was voluntary. At Hugo Knit, employees said that they risked being shouted at if they refused to work overtime, and that factory management had demanded they sign a statement declaring that they had chosen to work overtime voluntarily.
Employees at both factories said that they were often pressured into working through part of their meal breaks if it was necessary to meet production quotas. No overtime supplement was paid for this work, as employees are entitled to receive under Vietnam’s Labour Code.32
3.2 No wage increases, wage deductions and restrictions on sick leave
 Under Vietnamese law, employers must establish a pay scale, rising in increments of at least 5per cent from one pay grade to the next.33 
According to employees at Kollan, they do receive wage increases from time to time, for
example in connection with changes in their employment contracts. The last wage increasewas less than 0.5 per cent (the equivalent of USD 0.9 per month). Payslips showed that employees who had worked at the factory for many years were paid only a marginally higher rate than the new recruits who were interviewed. Employees at both Kollan and Hugo Knit reported wage deductions if they took sick leave. According to workers at Kollan, the company docked the entire month’s housing, food, and position allowance, corresponding to USD 22.50) if an employee took more than two days’sick leave, even if they had a doctor’s medical certificate. This constitutes legitimate sickness absence which, by law, the company has a duty to accept.34
Similarly, employees at Hugo Knit said that up to half of their attendance bonus was docked if they took one day of lawful sick leave (corresponding to USD 2), and that the entire bonus was docked for two days’ sickness absence (USD 4.5). If an employee took any further sick leave, the rent and food allowance (approx. USD 27.50) was also docked, even if the employee had a doctor’s medical certificate.
Employees are entitled to paid sick leave through the country’s social security system.35 Vietnam’s Labour Code does not permit the use of wage deductions to penalise employees.36
32 Labour Code, Article 97 (1a).
33 Decree 49/2013/ND-CP, Article, available at http://staffing.vn/en/r600/Decree-492013NDCP--on-wages-of-
labor-code.html .
34 Law on Social Insurance, Article 25, https://www.ilo.org/dyn/natlex/docs/ELECTRONIC/99775/126463/F-
1921723198/VNM99775%20Eng.pdf
35 Law on Social Insurance, Article 25. 36 Labour Code, Article 128.

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3.3 Occupational health and safety
The right to a safe and healthy working environment is laid down in international norms and further defined by the Committee on Economic, Social and Cultural Rights (CESCR) thus: “Preventing occupational accidents and disease is a fundamental aspect of the right to just and favourable conditions of work, and is closely related to other Covenant rights, in particular the right to the highest attainable level of physical and mental health.”37 The committee also says that freedom from harassment is part of a safe and healthy working environment.
Harassment
Harassment, including public humiliation and the punishment of employees, is forbidden under Vietnamese law.38
Workers at both factories reported widespread verbal abuse, such as telling off, swearing and insults from supervisors. This happened particularly when employees did not meet their production targets, asked not to work overtime or returned from sick leave or holiday.
Employees at Kollan also reported that some managers punished employees returning to work after lawful absence by demanding that they stand in front of the production line for an hour. They also said that if anyone argued with their supervisors, they would be punished – either by being given other tasks which would make it difficult for them to meet their production targets or, in extreme cases, by being pressured into quitting their jobs.
Fire safety
Both the Kollan and Hugo Knit factories are two-storey buildings. Kollan employees said that the only way down from the first floor to the ground floor is via an open staircase at either end of the building. In the event of a fire on the ground floor, there is a danger that the stairwells will fill with smoke, making them unusable for evacuation purposes. According to the workers, there are no other emergency exits.
At Hugo Knit, each floor has two exit doors. Employees said that one of the exit doors on the first floor was kept locked during working hours. In the event of a fire, this could mean that employees have no escape route from the first floor.
Vietnam’s Labour Code contains many provisions relating to fire safety, including access to safe emergency exits.39 Several of the workers who had been at Hugo Knit since 2012 reported that no fire drills were held at the factory. The law requires fire drills to be held at least once a year. 40
Fainting and high indoor temperatures
The Vietnamese authorities require that the indoor temperature not exceed 34C for light work, 32C for normal work and 30C for heavy work during the hot season. 41 Better Work has set 32C as the maximum indoor temperature in the textiles industry.42
37 CESCR General Comment No. 23 (2016) on the right to just and favourable conditions of work, section 1. 38 Labour Code, Article 8 (2).
39 Better Work Vietnam 2017: Guide to Vietnamese Labour Law for the Garment Industry, Section 9.11.5,
available at https://betterwork.org/dev/wp-content/uploads/2017/04/BWV_LLG-update_English_March-
2017.pdf
40 Better Work Vietnam 2017: Guide to Vietnamese Labour Law for the Garment Industry, Section 9.11.1. 41 Ministry of Health, Labour Hygiene Standards (Oct. 10, 2012)
42 Better Work, Guide to Vietnamese Labour Law for the Garment Industry 2016, Section 9.7, http://betterwork.org/vietnam/wp-content/uploads/BWV_LLG-update_English_280316.pdf .
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Workers at Kollan reported high temperatures inside the building. Since measured data is unavailable, it is not possible to state exactly how hot it is inside the premises. Several employees said that they had seen co-workers faint while at their posts. High temperatures are considered a contributory factor to fainting in textiles factories.
Employees at Hugo Knit also reported high temperatures inside the factory. They explained that the factory does have a cooling system, but that it is turned on for only one hour a day because factory management believes the increased humidity it causes damages the products.
Inadequate protective equipment
Vietnam’s Labour Code requires employers to ensure that those employees who work in an environment hazardous to their health are provided with adequate protective equipment. 43
Employees at Kollan described a dusty working environment, with a lot of noise. Nevertheless, they were not given dust masks or ear plugs. At Hugo Knit, employees are given dust masks and earplugs, but these are not replaced often enough. As a result, staff buy their own masks to reduce the amount of dust they inhale. Earplugs are replaced every other month, which is too infrequently to provide adequate protection. 44
Restrictions on bathroom breaks
According to employees at Kollan, the only toilets are on the building’s ground floor. For employees working on the first floor, who have further to go to reach the toilets, factory management is said to have put a limit of two bathroom breaks per day in order to reduce the amount of time employees are away from their posts.
Employees at Hugo Knit said that factory management requires them to record in writing the exact time they enter and exit the toilets, and that they receive a written warning if they exceed the allotted time.

3.4 Discrimination
The International Covenant on Civil and Political Rights and the International Covenant on Economic, Cultural and Social Rights contain explicit provisions (in Articles 2 and 3) prohibiting discrimination on the grounds of gender, birth or other status. The ban on discriminating against women is elaborated in further detail in the Convention on the Elimination of All Forms of Discrimination against Women. ILO convention no. 100 on equal pay for men and women also establishes this same principle. Under Vietnamese law, it is not permitted to dismiss a woman from her job because she has become pregnant.45
Employees at Kollan said that it was normal practice for the company not to renew the employment contracts of women workers who fell pregnant. This applied particularly to workers on short-term contracts.
43 Labour Code, Article 149.
44 For example, see the U.S. Dept. of Labor, Occupational Safety and Health Administration, Interpretive Letter
concerning Employer Obligation to Provide Hearing Protectors, Oct. 2, 2000,
https://www.osha.gov/pls/oshaweb/owadisp.show_document?p_table=INTERPRETATIONS&p_id=25014. 45 Labour Code Article 155 (3).
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3.5 Freedom of association
The right to freedom of association and the right to organise are laid down in the UN Convention on Civil and Political Rights and the International Covenant on Economic, Social and Cultural Rights, as well as the ILO’s convention no. 87 on Freedom of Association and Protection of the Right to Organise (one of the ILO’s core conventions) and the ILO’s Tripartite Declaration of Principles Concerning Multinational Enterprises and Social Policy.
Under Vietnamese law, all trade unions must be affiliated to the Vietnam General Confederation of Labour (VGCL), which is controlled by the country’s Communist Party.46 The formation of free and independent trade unions is therefore not permitted. Nevertheless, the law does not prevent employees from nominating and electing their own trade union representatives.
Employees at both Kollan and Hugo Knit reported that there was a trade union at each of the factories, but that they functioned solely as social welfare organisations which did not represent employees in disputes with factory management.
The trade union leader at Kollan was said to work in the factory management’s office. Those interviewed did not know of any other members of the trade union leadership. Nor were they aware of any collective bargaining agreement. Employees also said that there was no functioning complaints mechanism at the factory and that they had no opportunity to submit complaints in the event of any disagreement with a supervisor or if they wished to raise other work-related issues.
Employees at Hugo Knit reported that they could contact the trade union only through their supervisors, who are representatives of factory management. As a result, the workers did not contact the trade union about working conditions for fear of being dismissed. They did not know the identities of the people running the trade union.

4 Information provided by the company 4.1 The Council’s contacts with Texwinca
The Council contacted Texwinca for the first time in June 2015 to request information about working conditions at the company’s factories in Vietnam. Texwinca replied by referring the Council to the company’s annual report and its Environmental, Social and Governance (ESG) Report, which can be found on the company’s website. However, Texwinca’s operations in Vietnam are not mentioned in the report.
Furthermore, Texwinca did not permit any inspection of Hugo Knit. In October 2016, the company was sent a draft recommendation to exclude it from the GPFG that had been prepared on the basis of the Council’s investigations. Texwinca replied that the company did not wish to comment on the recommendation.
To obtain a broader basis for assessing the company, Kollan was investigated in May–July 2017. Texwinca was sent a new draft recommendation to exclude the company in February 2018. Once again, the company said it did not wish to comment on working conditions at the factories.
46 VGCL, Statutes of the Vietnamese Trade Unions (Nov. 5, 2008), http://ilo.org/dyn/natlex/natlex4.detail?p_lang=en&p_isn=94503&p_country=VNM&p_count=532
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In its communications with the Council on Ethics, Texwinca has commented solely on its corporate structure, but has otherwise provided no information about the matter at hand. According to Texwinca:
“We have no comment on the enclosed draft recommendation. As explained in our previous communication, it is the Group’s strategy to remain as a passive investor in the Megawell business. To allow maximum appropriate authority to the managers of Megawell Group to operate and expand the business, it was agreed that we would impose the minimum intervention in the business of Megawell. Though we hold 50% equity interest in Megawell Group, the other two active investors, acting in concert and collectively own the remaining equity interest, also maintain 50% controlling interest in Megawell Group. Thus, we have no legal right to exercise full control on Megawell.” 47

4.2 Texwinca’s policies at its factories in China
There is no available information about what Texwinca or Megawell is doing to safeguard good working conditions at the factories in Vietnam.
With respect to Texwinca’s factories in China, the company writes:
“Specific to our textile operations, employees are offered a range of allowances and bonuses such as compensation for working in high temperature environments, night shift allowance as well as performance and end of year bonuses.”48
With respect to occupational health and safety, the company writes:
“Safety is a core tenet of our operations and embedded into the very fabric of the way in which we do business. The health and safety of our employees as well all those within reach of our operations is of utmost concern to us.”49
The company writes that it carries out frequent inspections at its production facilities in China and that employees who perform hazardous work are offered free annual health checks.
With respect to its suppliers, Texwinca states: “Our suppliers are expected to adhere to our high standards, demonstrating continuous development in a variety of operational, economic, social and environmental areas.” And further: “Our responsible departments also closely monitor suppliers at regular intervals to ensure compliance with social and environmental standards.”50

5 The Council on Ethics’ assessment
The Council on Ethics has assessed whether there is an unacceptable risk that Texwinca is contributing to or is itself responsible for systematic violations of internationally recognised labour rights norms in connection with Megawell’s production of fabrics and garments. Texwinca owns 50 per cent of the shares in Megawell, making it the company’s largest shareholder. The Council has looked into conditions at Megawell’s garment factories in Vietnam.
47 Email from Texwinca to the Council on Ethics, 11 April 2018.
48 Texwinca Holdings Ltd., Environmental, Social and Governance Report 2017,
http://www.irasia.com/listco/hk/texwinca/annual/esr182339-e00321_esg_1006_1530.pdf
49 See footnote 48, p 33. 50 See footnote 48, p 35.
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Texwinca has had the same shareholding in Megawell for more than 20 years. Texwinca presents Megawell as part of its corporate structure. Nevertheless, Texwinca asserts that it does not have a controlling influence over Megawell, that the company’s strategy is to remain a passive shareholder and that it has been agreed that Texwinca will exert minimal influence over Megawell. The Council does not know which agreements in law have been entered into between the companies, but considers that Texwinca’s dominant shareholding, combined with the fact that Texwinca’s top managers have held senior positions at Megawell for more than 20 years, indicates that Texwinca does indeed have a significant influence over Megawell.
Because of the company’s ownership structure, the Council considers norm violations at Kollan and Hugo Knit to be norm violations in Texwinca’s own operations. The Council takes the position that, with respect to norm violations perpetrated within a company’s own operations, the threshold for what can be accepted must be lower than when a company contributes to norm violations perpetrated by a third party.
The Council on Ethics has based its assessment on its own investigations that were carried out in 2016 and 2017. These investigations point to a working environment that may be harmful to the employees’ health. Workers at both factories have reported substantial overtime, high production quotas, high indoor temperatures and widespread harassment and abuse by supervisors. At Kollan, this has contributed to employees fainting at their posts. The Council has, moreover, noted employees’ statements about violations of the fire safety regulations and restrictions on bathroom breaks, as well as claims that legitimate sick leave is penalised through wage deductions and that the company, in practice, forces employees to work overtime. In the Council’s opinion, this constitutes a clear violation of the right to a safe and healthy working environment. The company’s practice also seems to contravene national laws whose precise purpose is to ensure good working conditions in factories.
Other norm violations relate to discrimination and interference in the workers’ freedom of association. The Council notes employees’ reports that female workers do not have their contracts renewed when they fall pregnant. Although freedom of association in general is limited in Vietnam, it appears to the Council that the company imposes further restrictions, in that the unions are run by management representatives. The right to form trade unions and to organise is considered fundamental for the ability to improve working conditions, engage in collective bargaining and prevent other labour rights from being infringed. The Council notes that there does not seem to be any complaints mechanisms at the factories, through which employees can raise issues concerning the violation of labour rights with management.
The Council finds it substantiated that the company’s practices in many areas contravene both internationally recognised labour rights and national legislation.
The Council attaches importance to the fact that Texwinca has not contributed to the clarification of matters in this case. The company has provided limited information about its relationship to Megawell, has not permitted the factory to be inspected and has not submitted comments on draft recommendations to exclude the company from the GPFG. Texwinca argues that conditions at factories of which it is the principal shareholder are none of its business. Consequently, the Council has had access to less information in this case than in other similar cases it has assessed. The information deficit applies to the scale of norm violations and what the company is doing to prevent them. In accordance with the wording of Report No. 20 (2008–2009) to the Norwegian Storting, the Council has concluded that a lack of information on the company’s conduct and, not least, a lack of willingness on the part of the company to provide information may, in and of itself, add to the risk of contributing to unethical behaviour being deemed unacceptably high.
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Texwinca’s dominant shareholding, combined with the fact that several individuals have been members of the boards and managements of both companies for many years, leads the Council to presume that Texwinca’s management is aware of and has accepted the working conditions at Megawell’s factories in Vietnam. Neither Texwinca nor Megawell have publicly disclosed what the companies are doing to improve those working conditions, nor have they indicated any commitment to preventing labour rights violations at the factories in Vietnam. When Texwinca claims that it has no influence over manufacturing operations in Vietnam, and Megawell does not publish any information about its business, it is natural for the Council to draw the conclusion that neither Texwinca nor Megawell are taking any responsibility for the prevention of human rights violations at the factories in Vietnam. The Council on Ethics considers that when a company in this way disclaims responsibility for preventing norm violation and fails to provide information about conditions or its own initiatives at its operations, the risk of systematic labour rights violations becomes unacceptably high.

6 Recommendation

The Council on Ethics recommends that Texwinca Holdings Ltd be excluded from investment by the Government Pension Fund Global (GPFG) due to an unacceptable risk that the company is responsible for systematic human rights violations.
***
Johan H. Andresen Hans Chr. Bugge Cecilie Hellestveit Trude Myklebust Leder
(sign.) (sign.) (sign.) (sign.)
Brit K. S. Rugland (sign.)

Asia Reassurance Initiative Act (ARIA) and the Re-Construction of Fortress America in the Indo-Pacific Region

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We have been writing about the pervasive importance of the Trump Administration's National Security Strategy as a driver of U.S. foreign and strategic policy (here, here, and here).  Now it appears that Congress has also joined in driving NSS strategic decisionmaking.
On the very last day of 2018, U.S. President Donald Trump signed into law the Asia Reassurance Initiative Act (ARIA), which according to the White House “establishes a multifaceted strategy to increase U.S. security, economic interests and values in the Indo-Pacific region.”

The act represents an attempt by the U.S. Congress to exercise a degree of oversight over the White House’s implementation of the Asia policy that is articulated in the 2017 National Security Strategy and the 2018 National Defense Strategy documents. (What ARIA Will and Won’t Do for the US in Asia).
ARIA allocated $1.5 billion for five years for designated programs in the Asia Pacific region. Beyond the expected--a renewed commitment to traditional alliances, a re-commitment to the denuclearization of Korea, and a reaffirmation of support for Taiwanese autonomy--the Act authorized renewed bilateral and multilateral engagement with US partners. Some have suggested that this opens the door to an arrangement between the now effective Trans Pacific Partnership and the United States, something the Trump administration signalled might be plausible as early as October 2018 (e.g., here). A reconstituted TPP would jump start America First in the sense of solidifying a large multilateral trade area within which production chains might be managed in accordance to shared values and insulated, in some respects from competing pressures. But even the threat of a fully reconstituted TPP could put pressure on China's alternative Belt and Road Initiative are least in the sense that it provides potential partners with bargaining leverage and might increase China's costs to assembling its own multilateral trading area. 

Of course, all of this might be mooted by both the change in the composition of Congress after January and in the tenor and practice of politics at the national level. And once again, national policy might be held captive to the strategic posturings of elected political aristocracies and those who back them behind the scenes all of whom might as much be motivated as much by personal and party interests as by the long term interests of the nation (with respect to which their own dynastic and factional should carry no weight at all). Still, the indication of an inclination among a sufficent number of members of Congress to the extent that might align with reconsidered positions )or reframed positions) of the Executive, could add an interesting element to the construction of both Belt and Road and America First in the Indo Pacific region.  And at the bottom of all of this is the continued and perhaps growing importance of the NSS as the operating manual of American foreign and military policy in the coming year.

This post includes a useful summary was provided by IndraStra and the text of ARIA.



The Summary of Asia Reassurance Initiative Act of 2018

:
  • Authorizes US$ 1.5 billion annually for 5 years to enhance U.S. presence in the Indo-Pacific;
  • Reaffirms U.S. security commitments to our allies in the Indo-Pacific, including Japan, South Korea, and Australia and builds security partnerships with nations in Southeast Asia;
  • Establishes a policy goal to peacefully denuclearize North Korea though the campaign of maximum pressure and engagement;
  • Enhances the U.S. diplomatic, economic, and security relationship with India;
  • Enforces U.S. freedom of navigation and overflight rights in the Indo-Pacific;
  • Expresses support for regular arms sales to Taiwan and to enhance the economic, political, and security relationship between Taiwan and the United States;
  • Promotes robust cybersecurity cooperation with our allies in the region; and
  • Sets U.S. policy to pursue effective arms control and nuclear nonproliferation policies in the Indo-Pacific region.

Part 2: Economic Engagement[2]

  • Promotes economic cooperation in the Indo-Pacific region as essential for the growth of the U.S. economy and success of American businesses;
  • Authorizes bilateral and multilateral trade negotiations with Indo-Pacific nations;
  • Provides for robust U.S. commercial presence throughout the Indo-Pacific region to promote U.S. exports and additional trade facilitation efforts;
  • Authorizes the imposition of penalties on entities and governments engaged in the theft of United States intellectual property; and
  • Requires a new comprehensive U.S. policy to promote energy exports.

Part 3: Promoting Values[3]

  • Provides US$ 150 million annually for 5 years for democracy, rule of law, and civil society support, including $10 million annually for freedom of information efforts in North Korea;
  • Call for additional U.S. efforts against trafficking-in-persons and human slavery; and Authorizes U.S. sanctions against human rights abusers.
_________


One Hundred Fifteenth Congress
of the
United States of America
AT THE SECOND SESSION
Begun and held at the City of Washington on Wednesday, the third day of January, two thousand and eighteen
An Act
To develop a long-term strategic vision and a comprehensive, multifaceted, and principled United States policy for the Indo-Pacific region, and for other purposes.
Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) SHORT TITLE.—This Act may be cited as the ‘‘Asia Reassur- ance Initiative Act of 2018’’.
(b) TABLE OF CONTENTS.—The table of contents for this Act is as follows:
Sec. 1. Short title; table of contents. Sec. 2. Findings.
TITLE I—UNITED STATES POLICY AND DIPLOMATIC STRATEGY IN THE INDO-PACIFIC REGION
Sec. 101. Policy.
Sec. 102. Diplomatic strategy.

TITLE II—PROMOTING UNITED STATES SECURITY INTERESTS IN THE INDO-PACIFIC REGION
Sec. 201. Authorization of appropriations.
Sec. 202. Treaty alliances in the Indo-Pacific region.
Sec. 203. United States-China relationship.
Sec. 204. United States-India strategic partnership.
Sec. 205. United States-ASEAN strategic partnership.
Sec. 206. United States-Republic of Korea-Japan trilateral security partnership. Sec. 207. Quadrilateral security dialogue.
Sec. 208. Enhanced security partnerships in Southeast Asia.
Sec. 209. Commitment to Taiwan.
Sec. 210. North Korea strategy.
Sec. 211. New Zealand.
Sec. 212. The Pacific Islands.
Sec. 213. Freedom of navigation and overflight; promotion of international law. Sec. 214. Combating terrorism in Southeast Asia.
Sec. 215. Cybersecurity cooperation.
Sec. 216. Nonproliferation and arms control in the Indo-Pacific region.

TITLE III—PROMOTING UNITED STATES ECONOMIC INTERESTS IN THE INDO-PACIFIC REGION
Sec. 301. Findings; sense of Congress.
Sec. 302. Trade negotiations, multilateral agreements, and regional economic sum-

mits.
Sec. 303. United States-ASEAN economic partnership.
Sec. 304. Trade capacity building and trade facilitation.
Sec. 305. Intellectual property protection.
Sec. 306. Energy programs and initiatives.
Sec. 307. Lower Mekong initiative.
Sec. 308. Sense of Congress on economic growth and natural resource conservation. Sec. 309. Sense of Congress in support of women’s economic rights.
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TITLE IV—PROMOTING UNITED STATES VALUES IN THE INDO-PACIFIC REGION
Sec. 401. Findings.
Sec. 402. Trafficking-in-persons.
Sec. 403. Freedom of the press.
Sec. 404. Democracy, human rights, and labor personnel.
Sec. 405. Bilateral and regional dialogues; people-to-people engagement.
Sec. 406. Association of Southeast Asian Nations Human Rights Strategy.
Sec. 407. Freedom of information to North Korea.
Sec. 408. Sense of Congress on imposition of sanctions and suspension of United

States assistance.
Sec. 409. Authorization of appropriations.

Sec. 410. Indo-Pacific human rights defenders.
Sec. 411. Young leaders people-to-people initiatives.

SEC. 2. FINDINGS.
Congress makes the following findings: (1) The Indo-Pacific region—
(A) represents nearly 50 percent of the global popu- lation;
(B) is home to some of the most dynamic economies in the world; and
(C) poses security challenges that threaten to under- mine United States national security interests, regional peace, and global stability.
(2) The core tenets of the United States-backed international system are being challenged, including by—
(A) China’s illegal construction and militarization of artificial features in the South China Sea and coercive

economic practices;
(B) North Korea’s acceleration of its nuclear and ballistic missile capabilities; and
(C) the increased presence throughout Southeast Asia of the Islamic State (referred to in this Act as ‘‘ISIS’’) and other international terrorist organizations that threaten the United States.
(3) The economic order in the Indo-Pacific region continues

to transform, presenting opportunities and challenges to United States economic interests.
(4) The United States has a fundamental interest in defending human rights and promoting the rule of law in the Indo-Pacific region. Although many countries in the region have improved the treatment of their citizens, several Indo- Pacific governments continue to commit human rights abuses and place restrictions on basic human rights and political and civil liberties.
(5) Without strong leadership from the United States, the international system, fundamentally rooted in the rule of law, may wither, to the detriment of United States, regional, and global interests. It is imperative that the United States continue to play a leading role in the Indo-Pacific region by—
(A) defending peace and security;
(B) advancing economic prosperity; and
(C) promoting respect for fundamental human rights.

(6) In 2017, the Subcommittee on East Asia, the Pacific, and International Cybersecurity Policy of the Committee on Foreign Relations of the Senate held a series of hearings on United States leadership in the Indo-Pacific region, in which—
(A) experts, including Representative Randy Forbes, Ambassador Robert Gallucci, Ms. Tami Overby, Dr. Robert
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Orr, Ambassador Derek Mitchell, Ambassador Robert King, Mr. Murray Hiebert, and others detailed the security challenges, economic opportunities, and imperatives of pro- moting the rule of law, human rights, and democracy, in the Indo-Pacific region; and
(B) Dr. Graham Allison, the Douglas Dillon Professor of Government at the John F. Kennedy School of Govern- ment at Harvard University, testified, ‘‘As realistic students of history, Chinese leaders recognize that the role the United States has played since World War II as the architect and underwriter of regional stability and security has been essential to the rise of Asia, including China itself. But they believe that as the tide that brought the United States to Asia recedes, America must leave with it. Much as Britain’s role in the Western Hemisphere faded at the beginning of the twentieth century, so must Amer- ica’s role in Asia as the region’s historic superpower resumes its place.’’.
(7) The United States National Security Strategy (referred to in this Act as the ‘‘National Security Strategy’’), which was released in December 2017, states—

(A) ‘‘A geopolitical competition between free and repressive visions of world order is taking place in the Indo- Pacific region. The region, which stretches from the west coast of India to the western shores of the United States, represents the most populous and economically dynamic part of the world. The United States interest in a free and open Indo-Pacific extends back to the earliest days of our republic.’’; and
(B) ‘‘Our vision for the Indo-Pacific excludes no nation. We will redouble our commitment to established alliances and partnerships, while expanding and deepening relation- ships with new partners that share respect for sovereignty, fair and reciprocal trade, and the rule of law. We will reinforce our commitment to freedom of the seas and the peaceful resolution of territorial and maritime disputes in accordance with international law. We will work with allies and partners to achieve complete, verifiable, and irreversible denuclearization on the Korean Peninsula and preserve the non-proliferation regime in Northeast Asia.’’.
TITLE I—UNITED STATES POLICY AND DIPLOMATIC STRATEGY IN THE INDO- PACIFIC REGION
SEC. 101. POLICY.
It is the policy of the United States to develop and commit to a long-term strategic vision and a comprehensive, multifaceted, and principled United States policy for the Indo-Pacific region that—
(1) secures the vital national security interests of the United States and our allies and partners;
(2) promotes American prosperity and economic interests by advancing economic growth and development of a rules- based Indo-Pacific economic community;

(3) advances American influence by reflecting the values of the American people and universal human rights;
(4) supports functional problem-solving regional architec- ture; and
(5) accords with and supports the rule of law and inter- national norms.
SEC. 102. DIPLOMATIC STRATEGY.
It is the diplomatic strategy of the United States— (1) to work with United States allies—
(A) to confront common challenges;
(B) to improve information sharing;
(C) to increase defense investment and trade; (D) to ensure interoperability; and
(E) to strengthen shared capabilities;

(2) to strengthen relationships with partners who—
(A) share mutual respect for the rule of law;
(B) agree with fair and reciprocal trade; and
(C) understand the importance of civil society, the rule of law, the free and reliable flow of information, and trans- parent governance;
(3) to support functional problem-solving regional architecture, including through the Association of Southeast Asian Nations, Asia-Pacific Economic Cooperation, and the East Asia Summit;

(4) to emphasize the commitment of the United States— (A) to freedom of navigation under international law; (B) to promote peaceful resolutions of maritime and territorial disputes; and
(C) to expand security and defense cooperation with allies and partners, as appropriate;

(5) to pursue diplomatic measures to achieve complete, verifiable, and irreversible denuclearization of North Korea; (6) to improve civil society, strengthen the rule of law,  and advocate for transparent governance;
(7) to develop and grow the economy through private sector partnerships between the United States and Indo-Pacific partners;

(8) to pursue multilateral and bilateral trade agreements in a free, fair, and reciprocal manner and build a network of partners in the Indo-Pacific committed to free markets;
(9) to work with and encourage Indo-Pacific countries— (A) to pursue high-quality and transparent infrastructure projects;
(B) to maintain unimpeded commerce, open sea lines or air ways, and communication; and
(C) to seek the peaceful resolution of disputes; and

(10) to sustain a strong military presence in the Indo- Pacific region and strengthen security relationships with allies and partners throughout the region.
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TITLE II—PROMOTING UNITED STATES SECURITY INTERESTS IN THE INDO- PACIFIC REGION
SEC. 201. AUTHORIZATION OF APPROPRIATIONS.
(a) DEFINED TERM.—In this section, the term ‘‘appropriate committees of Congress’’ means—
(1) the Committee on Appropriations of the Senate;
(2) the Committee on Foreign Relations of the Senate; (3) the Committee on Finance of the Senate;
(4) the Committee on Appropriations of the House of Representatives;
(5) the Committee on Foreign Affairs of the House of Representatives; and
(6) the Committee on Ways and Means of the House of

Representatives.
(b) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to be appropriated for the Department of State, the United States Agency for International Development, and, as appropriate, the Department of Defense, $1,500,000,000 for each of the fiscal years 2019 through 2023, which shall be used—
(1) to advance United States foreign policy interests and objectives in the Indo-Pacific region in recognition of the value of diplomatic initiatives and programs in the furtherance of United States strategy;
(2) to improve the defense capacity and resiliency of partner nations to resist coercion and deter and defend against security threats, including through foreign military financing and inter- national military education and training programs;
(3) to conduct regular bilateral and multilateral engagements, particularly with the United States’ most highly-capable allies and partners, to meet strategic challenges, including—
(A) certain destabilizing activities of the People’s Republic of China; and
(B) emerging threats, such as the nuclear and ballistic missile programs of the Democratic People’s Republic of Korea;
(4) to build new counterterrorism partnership programs

in Southeast Asia to combat the growing presence of ISIS and other terrorist organizations that pose a significant threat to the United States, its allies, and its citizens’ interests abroad;
(5) to help partner countries strengthen their democratic systems, with a focus on good governance;
(6) to ensure that the regulatory environments for trade, infrastructure, and investment in partner countries are trans- parent, open, and free of corruption;
(7) to encourage responsible natural resource management in partner countries, which is closely associated with economic growth; and
(8) to increase maritime domain awareness programs in South Asia and Southeast Asia—
(A) by expanding the scope of naval and coast guard training efforts with Southeast Asian countries;
(B) by expanding cooperation with democratic partners in South Asia, including Bangladesh, Nepal, and Sri Lanka;

(C) through intelligence sharing and other information- sharing efforts; and
(D) through multilateral engagements, including by involving Japan, Australia, and India in such efforts.
(c) COUNTERING CHINAS INFLUENCE TO UNDERMINE THE INTER- NATIONAL SYSTEM.—Amounts appropriated pursuant to subsection (b) shall be made available for United States Government efforts to counter the strategic influence of the People’s Republic of China, in accordance with the strategy required under section 7043(e)(3) of the Department of State, Foreign Operations, and Related Pro- grams Appropriations Act, 2014 (division K of Public Law 113– 76; 128 Stat. 536) and in consultation with the appropriate commit- tees of Congress.
(d) BURMA.—None of the amounts appropriated pursuant to subsection (b) may be made available for International Military Education and Training and Foreign Military Financing Programs for the armed forces of the Republic of the Union of Myanmar (historically known as ‘‘Burma’’).
(e) PHILIPPINES.—
(1) I
N GENERAL.—None of the amounts appropriated pursuant to subsection (b) may be made available for counternarcotics assistance for the Philippine National Police unless the Sec- retary of State determines and reports to the appropriate committees of Congress that the Government of the Philippines has adopted and is implementing a counternarcotics strategy that is consistent with international human rights standards, including investigating and prosecuting individuals who are credibly alleged to have ordered, committed, or covered up extrajudicial killings and other gross violations of human rights in the conduct of counternarcotics operations.
(2) EXCEPTION.—The limitation under paragraph (1) shall not apply to funds made available—
(A) for drug demand reduction, maritime programs, or transnational interdiction programs; or
(B) to support for the development of such counter- narcotics strategy, after consultation with the appropriate committees of Congress.
(f) CAMBODIA.—None of the amounts authorized to be appropriated pursuant to subsection (b) may be made available for United States assistance programs that benefit the Government of Cambodia unless the Secretary of State certifies and reports to the appropriate congressional committees that the requirements under section 7043(b)(1) of division K of the Consolidated Appropriations Act, 2018 (Public Law 115–141) have been met.
SEC. 202. TREATY ALLIANCES IN THE INDO-PACIFIC REGION.
(a) UNITED STATES-JAPAN ALLIANCE.—The United States Government—
(1) is committed to the Treaty of Mutual Cooperation and Security between the United States and Japan, done at Washington, January 19, 1960, and all related and subsequent bilateral security agreements and arrangements concluded on or before the date of the enactment of this Act;
(2) recognizes the vital role of the alliance between the United States and Japan in promoting peace and security in the Indo-Pacific region; and
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(3) calls for the strengthening and broadening of diplomatic, economic, and security ties between the United States and Japan.
(b) U
NITED STATES-REPUBLIC OF KOREA ALLIANCE.—The United States Government—
(1) is committed to the Mutual Defense Treaty Between

the United States and the Republic of Korea, done at Washington October 1, 1953, and all related and subsequent bilateral security agreements and arrangements concluded on or before the date of the enactment of this Act;
(2) recognizes the vital role of the alliance between the United States and South Korea in promoting peace and security in the Indo-Pacific region; and
(3) calls for the strengthening and broadening of diplomatic, economic, and security ties between the United States and the Republic of Korea.
(c) U
NITED STATES-AUSTRALIA ALLIANCE.—The United States
Government—
(1) is committed to the Security Treaty Between Australia

and the United States of America, done at San Francisco September 1, 1951, and all related and subsequent bilateral security agreements and arrangements concluded on or before the date of the enactment of this Act;
(2) recognizes the vital role of the alliance between the United States and Australia in promoting peace and security in the Indo-Pacific region; and
(3) calls for the strengthening and broadening of diplomatic, economic, and security ties between the United States and Australia.
(d) U
NITED STATES-PHILIPPINES ALLIANCE.—The United States
Government is committed to the Mutual Defense Treaty between the Republic of the Philippines and the United States of America, done at Washington August 30, 1951, and all related and subsequent bilateral security agreements and arrangements concluded on or before the date of the enactment of this Act, including the Enhanced Defense Cooperation Agreement, done at Manila April 28, 2014.
(e) THAILAND.—The United States Government is committed to—
(1) the Agreement Respecting Military Assistance Between the Government of the United States of America and the Government of Thailand, done at Bangkok October 17, 1950;
(2) the Southeast Asia Collective Defense Treaty, done at Manila September 8, 1954; and
(3) all related and subsequent bilateral security agreements and arrangements concluded on or before the date of the enactment of this Act, including the Joint Vision Statement for the Thai-United States Defense Alliance, issued in Bangkok November 15, 2012.
SEC. 203. UNITED STATES-CHINA RELATIONSHIP.
(a) IN GENERAL.—The United States Government—
(1) expresses grave concerns with Chinese actions that

seek—
(A) to further constrain space for civil society and

religion within China; and
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(B) to undermine a rules-based order in the Indo-Pacific region;
(2) encourages China to play a constructive role in world affairs by demonstrating consistent respect for the rule of law and international norms;
(3) seeks to build a positive, cooperative, and comprehensive relationship with China—
(A) by expanding areas of cooperation; and
(B) by addressing areas of disagreement, including over human rights, economic policies, and maritime security; and
(4) is committed to working with China on shared regional

and global challenges, especially—
(A) upholding and strengthening the rules-based inter-

national system; and
(B) the denuclearization of North Korea.

(b) SENSE OF CONGRESS.—It is the sense of Congress that the United States should—
(1) welcome a decision by China to change course and pursue a responsible results-oriented relationship with the United States and engagement on global issues;
(2) encourage China to play a constructive role in the Indo-Pacific region and globally; and
(3) continue to call out Chinese actions that undermine the rules-based international system.
SEC. 204. UNITED STATES-INDIA STRATEGIC PARTNERSHIP.
(a) IN GENERAL.—The United States Government—
(1) recognizes the vital role of the strategic partnership between the United States and India in promoting peace and

security in the Indo-Pacific region;
(2) calls for the strengthening and broadening of diplomatic, economic, and security ties between the United States and India; and

(3) is committed to—
(A) the New Framework for the United States-India

Defense Relationship, done at Arlington, Virginia on June 28, 2005;
(B) the United States-India Defense Technology and Trade Initiative, launched in 2012;
(C) the Joint Strategic Vision for the Indo-Pacific and Indian Ocean Region, announced on January 25, 2015; (D) the United States-India Joint Statement on Prosperity Through Partnership, issued on June 26, 2017; and (E) all related and subsequent bilateral and security agreements and arrangements concluded as of the date
of the enactment of this Act.
(b) I
NDIA AS MAJOR DEFENSE PARTNER.—Congress makes the
following findings:
(1) Section 1292(a)(1)(A) of the National Defense Authorization Act for Fiscal Year 2017 (Public Law 114–328; 130 Stat. 2559; 22 U.S.C. 2751 note) requires the recognition of India as a major defense partner.

(2) The designation of India as a major defense partner, which is unique to India—

(A) institutionalizes the progress made to facilitate defense trade and technology sharing between the United States and India;
(B) elevates defense trade and technology cooperation between the United States and India to a level commensurate with the closest allies and partners of the United States;
(C) facilitates technology sharing between the United States and India, including license-free access to a wide range of dual-use technologies, after taking into account national security concerns; and
(D) facilitates joint exercises, coordination on defense strategy and policy, military exchanges, and port calls in support of defense cooperation between the United States and India.
SEC. 205. UNITED STATES-ASEAN STRATEGIC PARTNERSHIP.
(a) SENSE OF CONGRESS.—It is the sense of Congress that the United States should—
(1) support and reaffirm the elevation of the United States- Association of Southeast Asian Nations (referred to in this section as ‘‘ASEAN’’) relationship to a strategic partnership;
(2) recommit to ASEAN centrality by helping build a strong, stable, politically cohesive, economically integrated, and socially responsible community of nations that has common rules, norms, procedures, and standards which are consistent with international law and the principles of a rules-based Indo- Pacific community;
(3) urge ASEAN to continue its efforts to foster greater integration among its members;
(4) recognize the value of—
(A) ASEAN engagement with economic, political, and

security partners within Asia and elsewhere, including Australia, Canada, the European Union, India, Japan, New Zealand, Norway, the Republic of Korea, and Taiwan; and
(B) strategic economic initiatives, such as activities under the United States–ASEAN Trade and Investment Framework Arrangement and the United States-ASEAN Connect, which demonstrate a commitment to ASEAN and the ASEAN Economic Community and build upon economic relationships in the Indo-Pacific region;
(5) support efforts by the nations comprising ASEAN—

(A) to address maritime and territorial disputes in a constructive manner; and
(B) to pursue claims through peaceful, diplomatic, and legitimate regional and international arbitration mechanisms, consistent with international law, including through the adoption of a code of conduct in the South China Sea to further promote peace and stability in the Indo-Pacific region;
(6) support efforts by United States partners and allies in ASEAN—
(A) to enhance maritime capability and maritime domain awareness;
(B) to protect unhindered access to, and use of, inter- national waterways in the Asia-Pacific region that are crit- ical to ensuring the security and free flow of commerce;
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(C) to counter piracy;
(D) to disrupt illicit maritime trafficking activities such as the trafficking of persons, goods, and drugs; and
(E) to enhance the maritime capabilities of countries or regional organizations to respond to emerging threats to maritime security in the Asia-Pacific region; and
(7) urge ASEAN member states to develop a common

approach to reaffirm the decision of the Permanent Court of Arbitration’s ruling with respect to the case between the Republic of the Philippines and the People’s Republic of China. (b) REPORT ON STRATEGIC FRAMEWORK FOR ENGAGEMENT WITH
ASEAN.—
(1) I
N GENERAL.—Not later than 180 days after the date
of the enactment of this Act, and annually thereafter for the following 5 years, the Secretary of State, in consultation with other Federal agencies, shall submit a report to the appropriate congressional committees on a strategic framework to admin- ister programs, projects, and activities of the United States to support diplomatic and economic engagement between the United States and ASEAN member countries for the 10-year period beginning on the date of the enactment of this Act.
(2) ELEMENTS.—The report required under paragraph (1) shall address the following elements of United States strategy: (A) Promoting commercial engagement between the
United States and member countries of ASEAN.
(B) Helping member countries of ASEAN use sustain- able, efficient, and innovative technologies in their respective energy sectors.
(C) Supporting economic conditions in member countries of ASEAN that promote innovation, the creation of new businesses, sustainable growth, and the education of the region’s future innovators, entrepreneurs, and business leaders.

(D) Working with member countries of ASEAN to improve the policy and regulatory environment for growth, trade, innovation, and investment.
(E) Supporting the regional integration objectives of member countries of ASEAN under the ASEAN Economic Community.
(F) Partnership opportunities with the governments of other countries friendly to the United States that have committed to a high set of standards for investment and development with ASEAN, as determined by the Secretary of State.
SEC. 206. UNITED STATES-REPUBLIC OF KOREA-JAPAN TRILATERAL SECURITY PARTNERSHIP.
It is the sense of Congress that the President should develop a strategy to deepen the trilateral security cooperation between the United States, South Korea, and Japan, including missile defense, intelligence-sharing, and other defense-related initiatives.
SEC. 207. QUADRILATERAL SECURITY DIALOGUE.
It is the sense of Congress that—
(1) the security dialogue between the United States, Australia, India, and Japan is vital to address pressing security challenges in the Indo-Pacific region in order to promote—

(A) a rules-based order;
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(B) respect for international law; and
(C) a free and open Indo-Pacific; and
(2) such a dialogue is intended to augment, rather than

to replace, current mechanisms.
SEC. 208. ENHANCED SECURITY PARTNERSHIPS IN SOUTHEAST ASIA.
(a) INDONESIA.—The United States Government is committed to—
(1) the United States-Indonesia Comprehensive Partner- ship, done in Washington November 9, 2010;
(2) the Joint Statement on Comprehensive Defense Cooperation, done in Washington October 26, 2015; and
(3) all related and subsequent bilateral and security agree- ments and arrangements between the United States and Indo- nesia concluded on or before the date of the enactment of this Act.

(b) MALAYSIA.—The United States Government is committed 

to—
the United States should deepen diplomatic, economic, and security cooperation, especially in the areas of maritime security and counterterrorism, with Indonesia, Malaysia, Singapore, and Vietnam.
(1) the United States-Malaysia Comprehensive Partner- ship, done at Putrajaya April 27, 2014;
(2) the Joint Statement for Enhancing the Comprehensive Partnership between the United States of America and Malaysia, done in Washington September 13, 2017; and
(3) all related and subsequent bilateral and security agreements and arrangements between the United States and Malaysia concluded on or before the date of the enactment of this Act.
(c) S
INGAPORE.—The United States Government is committed 
 to—

(1) the Strategic Framework Agreement Between the United States of America and the Republic of Singapore for a Closer Cooperation Partnership in Defense and Security, done at Washington July 12, 2005;
(2) the Enhanced Defense Cooperation Agreement, done at Arlington, Virginia December 7, 2015; and
(3) all related and subsequent bilateral and security agreements and arrangements between the United States and Singapore concluded on or before the date of the enactment of this Act.
(d) V
IETNAM.—The United States Government is committed
 to— 

(1) the United States-Vietnam Comprehensive Partnership, done at Washington December 16, 2013;
(2) the United States Vietnam Joint Vision Statement on Defense Relations, done at Hanoi on June 1, 2015;
(3) the United States Vietnam Joint Vision Statement, done at Washington May 31, 2017; and
(4) all related and subsequent bilateral and security agree- ments and arrangements between the United States and Vietnam concluded on or before the date of the enactment of this Act.
(e) S
ENSE OF CONGRESS.—It is the sense of Congress that the United States should deepen diplomatic, economic, and security cooperation, especially in the areas of maritime security and counterterrorism, with Indonesia, Malaysia, Singapore, and Vietnam.

SEC. 209. COMMITMENT TO TAIWAN.
(a) UNITED STATES COMMITMENT TO TAIWAN.—It is the policy of the United States—
(1) to support the close economic, political, and security relationship between Taiwan and the United States;
(2) to faithfully enforce all existing United States Government commitments to Taiwan, consistent with the Taiwan Relations Act of 1979 (Public Law 96–8), the 3 joint communiques, and the Six Assurances agreed to by President Ronald Reagan in July 1982; and
(3) to counter efforts to change the status quo and to support peaceful resolution acceptable to both sides of the Taiwan Strait.
(b) A
RMS SALES TO TAIWAN.—The President should conduct
regular transfers of defense articles to Taiwan that are tailored to meet the existing and likely future threats from the People’s Republic of China, including supporting the efforts of Taiwan to develop and integrate asymmetric capabilities, as appropriate, including mobile, survivable, and cost-effective capabilities, into its military forces.
(c) TRAVEL.—The President should encourage the travel of high- level United States officials to Taiwan, in accordance with the Taiwan Travel Act (Public Law 115–135).
SEC. 210. NORTH KOREA STRATEGY.
(a) FINDINGS.—Congress makes the following findings:
(1) The Government of the Democratic People’s Republic of Korea has flagrantly defied the international community by illicitly developing its nuclear and ballistic missile programs, in violation of United Nations Security Council Resolutions 1718 (2006), 1874 (2009), 2087 (2013), 2094 (2013), 2270 (2016),

2321 (2016), 2371 (2017), 2375 (2017), and 2397 (2017).
(2) The Government of the Democratic People’s Republic of Korea engages in gross human rights abuses against its own people and citizens of other countries, including the United

States, the Republic of Korea, and Japan.
(3) The United States is committed to pursuing a peaceful denuclearization of the Democratic People’s Republic of Korea through a policy of maximum pressure and engagement, in close concert with its partners.
(b) P
OLICY OF THE UNITED STATES WITH RESPECT TO SANCTIONS
AGAINST THE DEMOCRATIC PEOPLES REPUBLIC OF KOREA.—
(1) S
TATEMENT OF POLICY.—It is the policy of the United States to continue to impose sanctions with respect to activities of the Government of the Democratic People’s Republic of Korea, persons acting for or on behalf of such government, or other persons in accordance with Executive Order No. 13551 (50 U.S.C. 1701 note; relating to blocking property of certain per- sons with respect to North Korea), Executive Order No. 13687 (50 U.S.C. 1701 note; relating to imposing additional sanctions), Executive Order No. 13694 (50 U.S.C. 1701 note; relating to blocking the property of certain persons engaging in significant malicious cyberenabled activities), Executive Order No. 13722 (50 U.S.C. 1701 note; relating to blocking the property of the Government of North Korea and the Workers’ Party of Korea, and prohibiting certain transactions with respect to North Korea), and Executive Order No. 13810 (82 Fed. Reg. 44705;
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relating to imposing additional sanctions with respect to North Korea), as such Executive orders are in effect on the day before the date of the enactment of this Act, until the Democratic People’s Republic of Korea is no longer engaged in the illicit activities described in such Executive orders, including actions in violation of the United Nations Security Council resolutions referred to in subsection (a)(1).
(2) REPORT.—Not later than 30 days after terminating any sanction with respect to the activities of the Government of the Democratic People’s Republic of Korea, a person acting for or on behalf of such government, or any other person pro- vided for in an Executive order listed in subsection (a), the Secretary of State, in consultation with the Secretary of the Treasury, shall submit a report to the appropriate congressional committees justifying the termination of the sanction and explaining the relationship between such termination and the cessation of any illicit activity that violates any of the United Nations Security Council resolutions referred to in subsection (a)(1) by such Government or person. The reporting requirement under this paragraph shall terminate on the date that is 5 years after the date of the enactment of this Act.
(3) RULE OF CONSTRUCTION.—Nothing in this subsection shall be construed to limit the authority of the President pursu- ant to the International Emergency Economic Powers Act (50 U.S.C. 1701 et seq.).
(c) P
OLICY OF THE UNITED STATES WITH RESPECT TO NEGOTIATION ON THE DEMOCRATIC PEOPLES REPUBLIC OF KOREAS NUCLEAR AND BALLISTIC MISSILE PROGRAMS.—It is the policy of the United States that the objective of negotiations with respect to the nuclear and ballistic missile programs of the Democratic People’s Republic of Korea be the complete, verifiable, and irreversible dismantlement of such programs.
(d) REPORT ON A STRATEGY TO ADDRESS THE THREATS POSED BY, AND THE CAPABILITIES OF, THE DEMOCRATIC PEOPLES REPUBLIC OF KOREA.—
(1) IN GENERAL.—Not later than 90 days after the date of the enactment of this Act, and every 180 days thereafter for the following 5 years, the Secretary of State, or a designee of the Secretary, in consultation with the Secretary of the Treasury, shall submit a report to the appropriate congressional committees that describes actions taken by the United States to address the threats posed by, and the capabilities of, the Democratic People’s Republic of Korea.
(2) ELEMENTS.—Each report required under paragraph (1) shall include—
(A) a summary of ongoing efforts by the United States to identify strategies and policies, including an assessment of the strengths and weaknesses of such strategies and policies—
(i) to achieve peaceful denuclearization of the Democratic People’s Republic of Korea; and
(ii) to eliminate the threat posed by the ballistic missile program of the Democratic People’s Republic of Korea;
(B) an assessment of—

(i) potential road maps toward peaceful denuclearization of the Democratic People’s Republic
of Korea and the elimination of the nuclear and ballistic missile threats posed by the Democratic People’s Republic of Korea; and
(ii) specific actions that the Democratic People’s Republic of Korea would need to take for each such roadmap to become viable;
(C) a summary of the United States strategy to increase international coordination and cooperation, whether unilaterally, bilaterally, or multilaterally, including sanctions enforcement and interdiction, to address the threat posed by the nuclear and ballistic missile programs of the Democratic People’s Republic of Korea, which shall include—

(i) a description of the actions taken by the Secretary of State, or designees of the Secretary, to consult with governments around the world, with the purpose of inducing such governments to fully implement the United Nations Security Council resolutions referred to in subsection (a)(1);
(ii) a description of the actions taken by such governments to fully implement United Nations Secu- rity Council resolutions related to the Democratic People’s Republic of Korea;
(iii) a list of countries with governments that the Secretary has determined are noncooperative with respect to implementing the United Nations Security Council resolutions referred to in subsection (a)(1); and
(iv) a plan of action to engage, and increase cooperation with respect to the Democratic People’s Republic of Korea, with the governments of the coun- tries on the list described in clause (iii);
(D) an assessment of the adequacy of the national export control regimes of countries that are members of the United Nations, and multilateral export control regimes, that are necessary to enforce sanctions imposed with respect to the Democratic People’s Republic of Korea pursuant to the United Nations Security Council resolu- tions referred to in subsection (a)(1); and
(E) an action plan to encourage and assist countries in adopting and using authorities necessary to enforce export controls required by United Nations Security Council resolutions.
(3) F
ORM OF REPORT.—Each report required under this
subsection shall be submitted in unclassified form, but may include a classified annex.
(e) S
ENSE OF CONGRESS.—It is the sense of Congress that—
(1) representatives of the United States shall use the voice and vote of the United States in all international organizations, as appropriate, to advocate for the expulsion of the Democratic People’s Republic of Korea from such organizations, until such time as the Democratic People’s Republic of Korea meets its commitments under the United Nations Security Council resolutions referred to in subsection (a)(1); and
(2) the Secretary of State should work to induce countries to meet their commitments under the United Nations Security Council resolutions referred to in subsection (a)(1), including
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by considering appropriate adjustments to the diplomatic posture and foreign assistance of the United States with governments that the Secretary has determined are noncooperative with respect to implementing the United Nations Security Council resolutions referred to in subsection (a)(1).
SEC. 211. NEW ZEALAND.
The United States Government is committed to—
(1) the Wellington Declaration, signed on November 5, 2010, which reaffirmed close ties and outlined future practical

cooperation between the United States and New Zealand;
(2) the Washington Declaration, signed on June 19, 2012, which strengthened the defense relationship by providing a framework and strategic guidance for security cooperation and

defense dialogues; and
(3) all related and subsequent bilateral and security agreements and arrangements between the United States and New Zealand concluded on or before the date of enactment of this Act.

SEC. 212. THE PACIFIC ISLANDS.
(a) IN GENERAL.—It is the sense of Congress that the United States should—
(1) support strong United States engagement with the nations of the South Pacific, including Fiji, Kiribati, the Mar- shall Islands, the Federated States of Micronesia, Nauru, Palau, Papua New Guinea, Samoa, the Solomon Islands, Tonga, Tuvalu, and Vanuatu;
(2) deepen its cooperation with the nations of the South Pacific in areas of mutual interest, including—
(A) fisheries and marine resource conservation; (B) environmental challenges and resilience; (C) global health;
(D) development and trade; and

(E) people-to-people ties; and
(3) continue to provide assistance to the Pacific Islands,

as appropriate, to support the rule of law, good governance, and economic development.
(b) U
NITED STATES-COMPACTS OF FREE ASSOCIATION.—It is the
sense of Congress that the Compacts of Free Association entered between the United States and the Freely Associated States (Republic of Marshall Islands, the Federated States of Micronesia, and the Republic of Palau)—
(1) enhance the strategic posture of the United States in the Western Pacific;
(2) reinforce United States regional commitment;
(3) preempt potential adversaries from establishing posi- tional advantage; and
(4) further self-governance, economic development, and self- sufficiency of the Freely Associated States.
SEC. 213. FREEDOM OF NAVIGATION AND OVERFLIGHT; PROMOTION OF INTERNATIONAL LAW.
(a) FREEDOM OF NAVIGATION.—It is the policy of the United States—

(1) to conduct, as part of its global Freedom of Navigation Program, regular freedom of navigation, and overflight oper- ations in the Indo-Pacific region, in accordance with applicable international law; and
(2) to promote genuine multilateral negotiations to peace- fully resolve maritime disputes in the South China Sea, in accordance with applicable international law.
(b) J
OINT INDO-PACIFIC DIPLOMATIC STRATEGY.—It is the sense
of Congress that the President should develop a diplomatic strategy that includes working with United States allies and partners to conduct joint maritime training and freedom of navigation oper- ations in the Indo-Pacific region, including the East China Sea and the South China Sea, in support of a rules-based international system benefitting all countries.
SEC. 214. COMBATING TERRORISM IN SOUTHEAST ASIA.
(a) DEFINITIONS.—In this section:
(1) A
PPROPRIATE COMMITTEES OF CONGRESS.—The term
‘‘appropriate committees of Congress’’ means—
(A) the Committee on Armed Services of the Senate; (B) the Committee on Foreign Relations of the Senate; (C) the Committee on Armed Services of the House of Representatives; and
(D) the Committee on Foreign Affairs of the House of Representatives.

(2) ISIS.—The term ‘‘ISIS’’ means the Islamic State of Iraq and Syria.
(b) REPORT.—Not later than 180 days after the date of the enactment of this Act, the Director of National Intelligence, in consultation with the Secretary of State, the Secretary of Defense, and other appropriate Federal officials, shall submit a report to the appropriate committees of Congress that contains an assessment of the current and future capabilities and activities of ISIS-linked, al-Qaeda-linked, and other violent extremist groups in Southeast Asia that pose a significant threat to the United States, its allies, and its citizens interests abroad.
(c) ELEMENTS.—The report required under subsection (b) shall include—
(1) the current number of ISIS-linked, al-Qaeda-linked, and other violent extremist group-affiliated fighters in South- east Asia;
(2) an estimate of the number of ISIS-linked, al-Qaeda- linked, and other violent extremist group-affiliated fighters expected to return to Southeast Asia from fighting in the Middle East;
(3) an analysis of the amounts and sources of ISIS-linked, al Qaeda-linked, and other various extremist group affiliated- fighters in Southeast Asia;
(4) the current resources available to combat the threat of ISIS-linked, al-Qaeda-linked, and other violent extremist group-affiliated fighters in Southeast Asia, and the additional resources required to combat such threat;
(5) a detailed assessment of the capabilities of ISIS-linked, al-Qaeda-linked, and other violent extremist group-affiliated fighters to operate effectively in the Indo-Pacific region, including the Philippines, Indonesia, and Malaysia;
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(6) a description of the capabilities and resources of governments in Southeast Asia to counter violent extremist groups; and
(7) a list of additional United States resources and capabilities that the Department of Defense and the Department of State recommend providing to governments in Southeast Asia to combat violent extremist groups.
SEC. 215. CYBERSECURITY COOPERATION.
(a) SENSE OF CONGRESS.—It is the sense of Congress that there should be robust cybersecurity cooperation between the United States and nations in the Indo-Pacific region—
(1) to effectively respond to cybersecurity threats, including state-sponsored threats;
(2) to share best practices to combat such threats;
(3) to strengthen resilience against cyberattacks, misinformation, and propaganda; and
(4) to strengthen the resilience of critical infrastructure. (b) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to be appropriated $100,000,000 for each of the fiscal years 2019 through 2023 to enhance cooperation between the United States and Indo-Pacific nations for the purposes of combatting cybersecurity threats.
SEC. 216. NONPROLIFERATION AND ARMS CONTROL IN THE INDO- PACIFIC REGION.
(a) IN GENERAL.—The United States Government—
(1) recognizes that the spread of nuclear and other weapons of mass destruction, and their means of delivery, constitutes

a threat to international peace and security;
(2) seeks to peacefully address the unique challenge posed

to regional and global stability by the illicit use, and the proliferation to and from North Korea, of sensitive nuclear and missile technologies, and other weapons of mass destruction;
(3) notes efforts by China and Russia—
(A) to expand and modernize their respective nuclear arsenals, including through significant research and development resources in hypersonic glide vehicles and other advanced technologies; and

(B) to pursue sales of commercial nuclear technologies; and
(4) recognizes the legitimate pursuit by many countries in the Indo-Pacific region of nuclear energy for a variety of peaceful applications.
(b) S
ENSE OF CONGRESS.—It is the sense of Congress that
the United States Government should undertake all reasonable and appropriate efforts to pursue effective arms control and non- proliferation policies in the Indo-Pacific region to limit the further spread of weapons of mass destruction and their means of delivery.
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TITLE III—PROMOTING UNITED STATES ECONOMIC INTERESTS IN THE INDO- PACIFIC REGION
SEC. 301. FINDINGS; SENSE OF CONGRESS.
(a) FINDINGS.—Congress makes the following findings:
(1) According to the United States Chamber of Commerce, by 2030—
(A) 66 percent of the global middle class population will be living in Asia; and
(B) 59 percent of middle class consumption will take place in Asia.
(2) According to the Asian Development Bank—

(A) Asian countries have signed 140 bilateral or regional trade agreements; and
(B) 75 more trade agreements with Asian countries are under negotiation or concluded and awaiting entry into force.
(3) Free trade agreements between the United States and 3 nations in the Indo-Pacific region (Australia, Singapore, and the Republic of Korea) have entered into force.

(4) The member states of the Association of Southeast Asian Nations (referred to in this section as ‘‘ASEAN’’), as a group—
(A) represent the fifth largest economy in the world; and
(B) have a combined gross domestic product of $2,400,000,000,000.
(5) The economy comprised of ASEAN member states grew

by 66 percent between 2006 and 2015, and the total value of bilateral trade between the United States and ASEAN member states has increased by 78 percent since 2004.
(6) In 2015, the trade surplus of goods sold by companies in ASEAN member states to consumers in the United States was $77,000,000,000, while the United States 2015 trade sur- plus of services provided to consumers in ASEAN member states was $8,000,000,000.
(7) According to US-ASEAN Business Council, goods and services exported from the United States to ASEAN member states support 550,000 jobs in the United States.
(8) According to the Business Roundtable—
(A) the United States, Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam were responsible for a combined 40 percent of global gross domestic product in 2017; and

(B) United States bilateral trade with the other nations referred to in subparagraph (A) supports 15,600,000 jobs in the United States.
(9) According to the United States National Security Strategy—
(A) ASEAN and Asia-Pacific Economic Cooperation ‘‘remain centerpieces of the Indo-Pacific’s regional architecture and platforms for promoting an order based on freedom’’; and

(B) the United States will ‘‘work with partners to build a network of states dedicated to free markets and protected from forces that would subvert their sovereignty.’’.
(b) SENSE OF CONGRESS.—It is the sense of Congress that trade between the United States and the nations in the Indo- Pacific region is vitally important to the United States economy, United States exports, and jobs in the United States.
SEC. 302. INDO-PACIFIC TRADE NEGOTIATIONS, MULTILATERAL AGREEMENTS, AND REGIONAL ECONOMIC SUMMITS.
Congress supports—
(1) multilateral, bilateral, or regional trade agreements with partners that—
(A) comply with trade obligations and respect, promote,and strictly adhere to the rule of law; and
(B) increase United States employment and expand the economy;

(2) formal economic dialogues that include concrete, verifiable, and measured outcomes;
(3) negotiations under the auspices of the World Trade Organization, including negotiations to enter into appropriate plurilateral and sectoral agreements;
(4) full implementation of the World Trade Organization’s Trade Facilitation Agreement by Indo-Pacific countries; and (5) the proactive, strategic, and continuing high-level use of the Asia-Pacific Economic Cooperation forum, the East Asia Summit, and the Group of 20 to pursue United States economic objectives in the Indo-Pacific region.
SEC. 303. UNITED STATES-ASEAN ECONOMIC PARTNERSHIP.
The President should seek to develop to negotiate a comprehensive economic engagement framework with the Association of South- east Asian Nations.
SEC. 304. TRADE CAPACITY BUILDING AND TRADE FACILITATION.
(a) IN GENERAL.—The President is encouraged to produce a robust and comprehensive trade capacity building and trade facilitation strategy, including leveling the playing field for American companies competing in the Indo-Pacific region.
(b) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to be appropriated such amounts as may be necessary to carry out subsection (a).
SEC. 305. INTELLECTUAL PROPERTY PROTECTION.
(a) IN GENERAL.—The President should takes steps to strengthen the enforcement of United States intellectual property laws as a top priority, including taking all appropriate action to deter and punish commercial cyber-enabled theft of intellectual property.
(b) ANNUAL REPORT.—Not later than 180 days after the date of the enactment of this Act, and annually thereafter for the fol- lowing 5 years, the President shall submit a report to Congress that—
(1) describes the efforts of the United States Government to combat intellectual property violations and commercial cyber- enabled theft in the Indo-Pacific region, particularly the Peo- ple’s Republic of China; and
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(2) includes a country-by-country assessment of priority areas for United States engagement and capacity building assistance.
(c) A
AUTHORIZATION OF APPROPRIATIONS.—There are authorized
to be appropriated to the United States Trade Representative such amounts as may be necessary to sponsor bilateral and multilateral activities designed to build capacity in the identified priority areas described in the annual report required under subsection (b).
SEC. 306. ENERGY PROGRAMS AND INITIATIVES.
(a) INDO-PACIFIC ENERGY STRATEGY.—
(1) S
TRATEGY.—Not later than 180 days after the date
of the enactment of this Act, and annually thereafter for the following 5 years, the President shall establish a comprehensive, integrated, multiyear strategy to encourage the efforts of Indo-Pacific countries to implement national power strategies and cooperation with United States energy companies and the Department of Energy national laboratories to develop an appropriate mix of power solutions to provide access to sufficient, reliable, and affordable power in order to reduce poverty, drive economic growth and job creation, and to increase energy security in the Indo-Pacific region.
(2) AUTHORIZATION OF APPROPRIATIONS.—There are author- ized to be appropriated $1,000,000 for each of the fiscal years 2019 through 2023 to carry out paragraph (1).
(b) R
ELIABLE ENERGY PARTNERSHIPS.—It is the sense of Con-
gress that the United States should explore opportunities to partner with the private sector and multilateral institutions, such as the World Bank and the Asian Development Bank, to promote universal access to reliable electricity in the Indo-Pacific region, including Myanmar (historically known as ‘‘Burma’’).
SEC. 307. LOWER MEKONG INITIATIVE.
(a) IN GENERAL.—The Secretary of State, in cooperation with the Administrator of the United States Agency for International Development, should increase regional engagement in the areas of environment, health, education, and infrastructure development with the Lower Mekong countries, including—
(1) assisting in the development of programs that focus on forecasting environmental challenges and resilience;
(2) assisting with transnational cooperation on sustainable uses of forest and water resources with the goal of preserving the biodiversity of the Mekong Basin and access to safe drinking water;
(3) assisting with education enrollment and broadband internet connectivity, particularly English training and connectivity in rural communities; and
(4) improving global health in the Lower Mekong countries, including—
(A) reducing the HIV/AIDS infection rate; and
(B) helping regional partners to track and treat malaria and tuberculosis.
(b) REPORT.—Not later than 180 days after the date of the enactment of this Act, and annually thereafter through 2023, the Secretary of State, in cooperation with the Administrator of the United States Agency for International Development, shall submit a report to Congress that includes—
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(1) a list and evaluation of Lower Mekong Initiative activities since its inception in 2009;
(2) a strategy for any increased regional engagement and measures of success for the activities described in paragraph (1); and
(3) an accounting of funds used to execute Lower Mekong Initiative activities.
SEC. 308. SENSE OF CONGRESS ON ECONOMIC GROWTH AND NATURAL RESOURCE CONSERVATION.
It is the sense of Congress that the President should encourage the governments of countries in the Indo-Pacific region and United States private sector interests with operations and investments in the region to deploy agriculture practices that—
(1) conserve natural resources; and
(2) preserve culturally and ecological valuable lands and water bodies.
SEC. 309. SENSE OF CONGRESS IN SUPPORT OF WOMEN’S ECONOMIC RIGHTS.
It is the sense of the Congress that the United States should— (1) support activities that secure private property rights and land tenure for women in developing countries in Asia,
including—
(A) establishing legal frameworks to give women equal

rights to own, register, use, profit from, and inherit land and property;
(B) improving legal literacy to enable women to exercise the rights described in subparagraph (A); and
(C) increasing the capacity of law enforcement and community leaders to enforce such rights;
(2) work with Asian civil society, governments, and multi-

lateral organizations to increase the capability of disadvantaged women and girls in Asia—
(A) to realize their rights;
(B) to determine their life outcomes;
(C) to assume leadership roles; and
(D) to influence decision-making in their households,

communities, and societies; and
(3) seek to expand access to appropriate financial products and services for women-owned micro, small, and medium-sized enterprises in Asia.
TITLE IV—PROMOTING UNITED STATES VALUES IN THE INDO-PACIFIC REGION
SEC. 401. FINDINGS.
Congress makes the following findings:
(1) The promotion of human rights and respect for democratic values in the Indo-Pacific region is in the United States’ national security interest.

(2) Continued support for human rights, democratic values, and good governance is critical to a successful United States diplomatic strategy in the Indo-Pacific.
(3) Strong support for human rights and democracy in the Indo-Pacific region is critical to efforts to reduce poverty,
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build rule of law, combat corruption, reduce the allure of extremism, and promote economic growth.
(4) There are serious concerns with the rule of law and civil liberties in Cambodia, China, North Korea, Laos, Thailand, and Vietnam, which have all been identified by Freedom House as ‘‘Not Free’’.
(5) There have been unacceptable human rights develop- ments in—
(A) Burma (Myanmar), which has been identified by Freedom House as ‘‘Partly Free’’, and the Department of State has declared that the violence against the Rohingya constitutes ethnic cleansing;
(B) the Philippines, which has been identified by Freedom House as ‘‘Partly Free’’, and where there are continued disturbing reports of extra-judicial killings; and
(C) China, where forced disappearances, extralegal detentions, invasive and omnipresent surveillance, and lack of due process in judicial proceedings remain troublesome. (6) according to the National Security Strategy, the United
States—
(A) will ‘‘support, with our words and actions, those

who live under oppressive regimes and who seek freedom, individual dignity, and the rule of law’’;
(B) ‘‘may use diplomacy, sanctions, and other tools to isolate states and leaders who threaten our interests and whose actions run contrary to our values’’; and
(C) ‘‘will support efforts to advance women’s equality, protect the rights of women and girls, and promote women and youth empowerment programs’’.
SEC. 402. TRAFFICKING-IN-PERSONS.
The President is encouraged to pursue additional efforts to combat trafficking in persons and human slavery in the Indo- Pacific region.
SEC. 403. FREEDOM OF THE PRESS.
It is the sense of Congress that—
(1) United States Government officials should lead by

example—
(A) by continuing to advocate for freedom of the press

in the Indo-Pacific region; and
(B) by engaging with the press corps at every appro-

priate opportunity; and
(2) the United States should advocate and support a Min- isterial to Advance Press Freedom in the Indo-Pacific to convene government and civil society, including journalists, to discuss and address the challenges facing press freedom in the Indo- Pacific region.
SEC. 404. DEMOCRACY, HUMAN RIGHTS, AND LABOR PERSONNEL.
It is the sense of Congress that—
(1) United States embassies and consulates in the Indo-

Pacific region should have personnel, as appropriate, who are dedicated to reporting on and advancing United States democ- racy, human rights, labor, anti-corruption, and good governance policy interests; and
(2) appropriate resources should be made available to carry out such activities.
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SEC. 405. BILATERAL AND REGIONAL DIALOGUES; PEOPLE-TO-PEOPLE ENGAGEMENT.
The Secretary of State should, as appropriate—
(1) establish high-level bilateral and regional dialogues with nations in the Indo-Pacific region regarding human rights and religious freedom violations;

(2) establish or support robust, people-to-people exchange programs in the Indo-Pacific region, particularly programs engaging young leaders; and
(3) establish educational exchanges and capacity-building programs emphasizing civil society development.
SEC. 406. ASSOCIATION OF SOUTHEAST ASIAN NATIONS HUMAN RIGHTS STRATEGY.
(a) SENSE OF CONGRESS.—It is the sense of Congress that the United States should continue to work with ASEAN to improve the capacity of ASEAN to address human rights, democracy, and good governance issues in Southeast Asia.
(b) STRATEGY.—Not later than 90 days after the date of the enactment of this Act, the Secretary of State, after consultation with the Administrator of the United States Agency for Inter- national Development, shall submit a strategy to the appropriate congressional committees to increase cooperation with ASEAN to promote human rights, democracy, and good governance in South- east Asia.
(c) CONTENTS.—The strategy submitted under subsection (b) should include—
(1) an assessment of the types of United States Government resources available to support increased cooperation; and
(2) an assessment to identify entities within ASEAN that the United States could potentially support or partner with to promote human rights, democracy, and good governance in Southeast Asia.
SEC. 407. FREEDOM OF INFORMATION TO NORTH KOREA.
The President is encouraged to continue efforts to enhance freedom of information access with regard to North Korea.
SEC. 408. SENSE OF CONGRESS ON IMPOSITION OF SANCTIONS AND SUSPENSION OF UNITED STATES ASSISTANCE.
(a) SANCTIONS.—It is the sense of Congress that the President should impose targeted financial penalties and visa ban sanctions, in accordance with applicable law and other relevant authorities, on any individual or entity that—
(1) violates human rights or religious freedoms; or
(2) engages in censorship activities.
(b) S
USPENSION OF FOREIGN ASSISTANCE.—It is the sense of
Congress that the President should, in accordance with applicable law, terminate, suspend, or otherwise alter United States economic assistance to any country that has engaged in serious violations of human rights or religious freedoms.
SEC. 409. AUTHORIZATION OF APPROPRIATIONS.
(a) PROMOTION OF DEMOCRACY IN THE INDO-PACIFIC REGION.— (1) IN GENERAL.—There is authorized to be appropriated $210,000,000, for each of the fiscal years 2019 through 2023, to promote democracy, strengthen civil society, human rights, rule of law, transparency, and accountability in the Indo-Pacific
S. 2736—24
region, including for universities, civil society, and multilateral institutions that are focusing on education awareness, training, and capacity building.
(2) DEMOCRACY IN CHINA.—Amounts appropriated pursuant to paragraph (1) shall be made available for United States Government efforts, led by the Assistant Secretary of State for Democracy, Human Rights, and Labor, to promote democ- racy, the rule of law, and human rights in the People’s Republic of China.
(3) TIBET.—Amounts appropriated pursuant to paragraph (1) shall be made available for nongovernmental organizations to support activities preserving cultural traditions and pro- moting sustainable development, education, and environmental conservation in Tibetan communities in the Tibet Autonomous Region and in other Tibetan communities in China, India, and Nepal.
SEC. 410. INDO-PACIFIC HUMAN RIGHTS DEFENDERS.
(a) DEFINED TERM.—In this section, the term ‘‘human rights defenders’’ means individuals, working alone or in groups, who nonviolently advocate for the promotion and protection of univer- sally recognized human rights and fundamental freedoms if the advocacy of such issues may result in the risk of safety or life.
(b) SENSE OF CONGRESS.—It is the sense of Congress that human rights defenders in the Indo-Pacific region have been facing increased difficulties with the rise of unprecedented crackdowns and conflicts.
(c) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to be appropriated $1,000,000 for each of the fiscal years 2019 through 2023 to provide critical assistance to human rights defenders through the Department of State’s Human Rights Defenders Fund.
(d) REPORT.—Not later than 180 days after the date of the enactment of this Act, and annually thereafter through 2023, the Secretary of State, in cooperation with the Administrator of the United States Agency for International Development, shall submit a report to Congress that includes—
(1) a list and evaluation of the Human Rights Defenders Fund activities since its inception;
(2) a strategy for any increased regional engagement and measures of success for the activities described in paragraph (1); and
(3) an accounting of funds used to execute the Human Rights Defender Fund activities.
SEC. 411. YOUNG LEADERS PEOPLE-TO-PEOPLE INITIATIVES.
There are authorized to be appropriated $25,000,000 for each of the fiscal years 2019 through 2023 to support Indo-Pacific young leaders initiatives, including the Young Southeast Asian Leaders Initiative, the ASEAN Youth Volunteers Program, and other people- to-people exchange programs that focus on building the capacity of democracy, human rights, and good governance activists in the Indo-Pacific region.
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SEC. 412. SAVINGS PROVISION.
Nothing in this Act may be construed as authorizing the use of military force.
Speaker of the House of Representatives.
Vice President of the United States and President of the Senate.

Conference Details: "Marxist-Leninism 2.0: Theory and Practice of Emerging Socialist Democracy in China and Cuba 12 February 2019 Penn State University

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I have been circulating information about the two parts of a conference I am helping to organize at Penn State University this coming 12 February 2019. Marxist Leninism 2.0: Theories and Practices of Socialist Democracy in China and Cuba brings together participants from China, Europe, and the United States to consider the way that democratic theory is being theorized and practiced in so-called illiberal states, that is states whose political organization is not grounded in the core principles of liberal democracy. The core insight is that as liberal democracy confronts the contradictions of 20th century democratic theory and moves toward a liberal democratic theory 2.0, it may be possible to begin to understand the outlines of a similar evolutive process in Marxist Lenisit states--a move toward a Marxist-Leninism 2.0 democratic theory. 

The conference is divided into two panels.  The first, China's Socialist Democracy considers recent developments in Chinese democratic theory and practice from a national and comparative perspective. The core object of participants will be to seek to extract the fundamental theory and characteristics of the emerging systems, and to point to the likely paths to further development.  The second, Popular Participation, Representation, and Constitutional Reform in Cuba,  considers recent developments in Cuban democratic theory and practice from a national and comparative perspective. Speakers will present the results of their study of popular participation in Cuban constitutional reform: The Democratic Constitution of Illiberal States—An Empirical Approach to Theorizing Popular Participation, Representation and Constitutional Reform in Cuba.

The Conference Concept Note follows along with program information. Updated Event information may be accessed HERE.  The Conference will be live streamed and recorded for later viewing.


 
Pennsylvania State University
12 February 2018
Lewis Katz Building
University Park
Sponsored by the Coalition for Peace & Ethics, the Foundation for Law and International Affairs, Penn State Law and School of International Affairs.  Funding provided in part by the Penn State University Park Allocation Committee.

Conference Concept Note

These are turbulent times for democratic theory. In the West, intellectuals worry about the continued viability of democratic republican systems in their current form. These worries have been augmented as the strategic behaviors of important actors have begun to push against the borders of democratic structures as well as by a perceived popular malaise expressed through the ordinary channels of democratic participation. The stresses affect democratic governance in a variety of ways. Populism is one label that Western influence leaders use to identify stresses on the processes of mass participation in government, principally through elections. Deep state is what others reference as the portion of the government of states that appear insulated from mass politics. Legalism is what is referenced as the diversion of political discourse within domestic legal orders and their resolution by judicial rather than political bodies. The response to these stresses remains tentative and in the earliest stages of development. The political order is being remade according to rules that are still emerging and not clear, or as yet easy to understand. At its core, these discussions touch on the continued development of stable structures that maintain robust and legitimate relations between individuals and the government that serves them, while elaborating systems of accountability and monitoring to suit the times.

And yet it is clear that what will emerge from these sometimes tumultuous conversations will produce new approaches both to the theory and practice of democratic governance in the West. These new approaches will vary to suit the new era of Western development in its many forms, but will remain faithful to the core premises of devolution of government authority from the people to representatives, popular accountability, through elections, and popular engagement through new mechanisms of mass participation in governance. This Liberal Democracy 2.0 will likely balance the competing principles of popular participation and representative government with reference to changing normative conceptions of the individual in relation to the state, now perhaps mediated more expressly by concepts of status and identity.

The global conversation about the essence, theory and practice of democracy has also come to the great Marxist Leninist states. Cuba and China, in particular have sought to recognize the challenges of the emerging new era in their respective national contexts. Each has recognized the central relevance of democracy to their respective normative systems, and have recognized the challenges to past practice that their respective stages of development has revealed. Each has sought to align emerging practice with these new era principles of democracy.

Has the response to these challenges resulted in the development of as Marxist Leninism 2.0 system of Socialist Democracy? That is the question that a diverse group of individuals drawn from Europe, China and the United States will consider.

The Conference is organized in two panels. The first will consider the issues of emerging Socialist Democracy and its expression in the development of the character of the leadership of the Chinese Communist Party (CPC) and of the role and operation of the state apparatus and related organizations. China has focused with increasing intensity of the core ideological and practical issues of developing socialist democracy with Chinese characteristics. Socialist democracy has become an umbrella concept that intermesh a number of important structures that constitute the framework within which democracy with both socialist and Chinese characteristics is defined and implemented. But socialist democracy also integrates what is referenced as “socialist consultative democracy.”

The First panel will consider issues related to the building of contemporary Chinese Socialist Democracy in the shadow of global debates and of the core national challenges as China moves to the next stage of its development. Panelists will examine the issue from a variety of perspectives. These include the examination of the development of democratic theory, in general, and the emergence of deep structures of Socialist Democracy in China in the New Era. To that end, we will briefly touch on the conjoining of two theoretical trajectories that, in the West, are rarely conjoined. To that end, panelists will explore the extent to which conventional exogenous democratic theory has opened the possibilities to theories of endogenous democracy. Panelists will also consider issues of accountability within developing conceptions of Socialist Democracy. To that end they will explore the emerging contours of Chinese consultative democracy. Aspects will include the role of the United Front and of the Chinese People’s Political Consultative Conference (CPPCC). Others will explore topics related to emergence of New Era constitutionalism from out of the 19th CPC Congress and expressed in the contemporary transformations of CPC and State Constitutions.

The second panel will consider the quite distinctive approach to emerging notions of democratic theory and practice in Cuba. To that end, panelists will examine the current multi-year reform of the core political and economic model of governance by the Cuban Communist Party (PCC) and the related reform of the Cuban state constitution to align with these evolving core premises. For the last several years Cuba has been in the midst of a quite public national effort at reform. The PCC and the state apparatus attempted to invoke the core mechanics of popular participation even as it sought to manage that participation under the leadership of the PCC and popular representatives in national institutions.

Through the use of qualitative and quantitative measures panelists will seek to better understand both the changing character of popular participation in representative institutions, and its consequences for democratic theory. Panelists will focus specifically on the relationship between changes to political ideology under the leadership of the PCC, and the management of popular participation in the formation of a key element of national self constitution. Panelists will report on the findings of an empirical study of the character and consequences of popular participation and suggests its consequences not just for the constitution of democratic practice in illiberal societies, but also its value in enhancing democratic engagement in liberal democracies as well.

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The Court's Lesson in Strategic Semiotics--Brief Thoughts on a Jurisprudence of Strategic Meaning in New Prime, Inc. v. Oliviera (No. 17-340; US Sup.Ct, Slip Op. 15 Jan. 2019)

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(Pix © Larry Catñá Backer; Bronzino Martirio di San Lorenzo, 1565-69, Florence )


Judges and lawyers tend to serve as the worker bees of the large jurisprudential colonies of semiotic communities ("They do all the work in the hive, and they control most of what goes on inside."Worker Bees). They are perfectly suited to the principal task of this "hive," the task of semiosis--of the process of signification in language--to the ends of which they have been well socialized by "teacher bees" in law schools and mentor bees in the law firms and at the great conclaves of lawyers and jurists at which communal socialization and cultural discipline is always a subtext (Broeckman and Backer, Lawyers Making Meaning). 

One of the newer of the Supreme Court's semiotics worker bees, Justice Gorsuch, recently delivered an opinion for a unanimous court, New Prime , Inc. v. Oliviera (No. 17-340; slip op. 15 Jan. 2019) which, along with the concurrence of Justice Ginsberg, are marvels of the craft of strategic semiotics, first by a journeyman who shows great promise in this craft, and then quite masterfully for the compactness of form, employed by one of its great masters of the judicial guild.  This is nothing new for the courts.  Now twenty years ago in what seems like a world ago I noted:
The Court has at last revealed (and reveled in) its identity, its equilibrium, and perhaps its mission. This past Term uncovers a Court most productive and at its best (whatever one may think of the results in particular cases) when it eschews grand theory and instructs in the everyday application of the myriad of mundane obligations imposed upon people by court and legislature. This is a practitioner's court, a cobbler's court-and many should be happy for it. ("A Cobbler's Court, a Practitioner's Court: The Rehnquist Court Finds Its Groove," 1998  Tulsa L. J. 34:347, 348).
The opinions of Justices Gorsuch and Ginsberg are both short and well worth reading.  They follow below, along with some brief remarks directed toward the principles underlying the meaning making that serve as the blunt (in this case) tools of these craftspeople.  

Like good wine or a stout winter bee produced by those who extract meaning form other objects (and perhaps better in some instances), the value is in savoring the opinions, not for the necessarily utilitarian tasks to which they were applied (though that will provide tremendous fodder, and opportunity, to the arbitration communities, of which I will say no more (but see here, here, here, here, here), but for the application of the submerged principles of meaning, applied with vigor and yet neither exposed nor examined.  That, of course, is the essence of the worker bee within a hive, sadly in this case, constructed by meaning beyond their competence.  



1. Semiosis, the process of signification in language, assumes a quite strategic role in the work of courts.  Courts in general, and this court in particular, appear quite willing to inscribe meaning in quite specific ways to key words, but also appear even more willing to limit semiosis to those words that they construct as key for the analysis they put forward. It is in that sense that judicial semiosis is strategic.  In an opinion full of words, only one was subject to the meaning making that centered the opinion.    

2. That strategic quality of semiosis was made apparent in the quite different approaches to answering the question of arbitral authority to determine jurisdiction, and the later question of the meaning of contract of employment.  With respect to the former issue, the court was quite content to rely on precedent and its own interpretation of the relationship of statutory provisions by the place where it appears in the statute.  That carries with it a host of assumptions about meaning that are neither stated nor explored.  Here precedent--in the form of words extracted from earlier cases to justify the construction of meaning in the case before the court--served to make meaning in the same way that dictionaries made meaning respecting the term contract of employment in the 1920s. 

3.  None of the meanings the court tales for granted are necessarily true in themselves.  They acquire their authority because the judges continue to agree that this is what is meant.  Thus the quite odd discussion of the word "worker" by Justice Gorsuch, especially in the context of the modalities of meaning employed to extract substance from contract of employment. 

4. The oddest and most telling point of the analysis was the admission that New Prime might have been right in distinguishing employment  from independent contractor agreements. Justice Gorsuch noted that it was possible that at least two distinct meanings for employment contract were plausible in 1925.  But he dismisses one as "these authorities appear to represent at most the vanguard, not the main body, of contemporaneous usage." But Justice Gorsuch's dismissal of vanguard meaning says nothing more than that this man, now a Justice of the Supreme Court, is suspicious of vanguards.  But Justice Gorsuch's predilections of meaning tells us nothing of the meaning Congress might have used. And there  is little in Justice Gorsuch's meaning making to suggest his determination, though plausible, is as arbitrary and any other. But it is based on a personal ideology he would impose on the rest of us--a personal belief in the meaning of interpretation that conflates meaning and legislative effect in ways that simultaneously give too little and too much credit to Congress.  That first paragraph of Section III.A colorfully illustrates the problem--and conundrum it poses for the courts.

5. Justice Ginsberg makes a telling point--it is not to dictionaries but to Congress that perhaps the courts ought to turn in the context of meaning making. And yet the borderlands of meaning making in statutory construction remains quite contentious in the United States. Should words be read with the times, or should the times be stuck with the words. In the absence of Congressional direction, it is up to the courts to determine--and the courts have not been consistent. And yet it may well be that Justice Ginsberg points to the obvious solution in this current age of Judicial interpretive proclivities--Congress may well have to legislate its own interpretation it if means to keep a greater control over the meaning that it, rather than the Courts, sought to make.

6. And thus the broader point.  Judges assume, along with lawyers, the modalities of meaning making without any sense of its principles or the consequences of its application from the perspective of a broader jurisprudence. True enough, judges are meant to focus on the quite narrow issue before them; but they have sense enough to understand the regulatory effect of the "law of the case." And yet the process of signification at the heart of Justice Gorsuch and Justice Ginsberg's analysis lack any sense of its essence. In the end, it leaves us with a quite narrow holding, a sense of specific approaches to meaning making  but no sense of when these forms of meaning making may be triggered (e.g. when one can convince a judge to undertaken it?) or when alternative meaning making mechanisms might be used (e.g., sequencing, the dead weight of prior meaning making direct or indirect, etc.). And so
  
__________
 
(Slip Opinion) OCTOBER TERM, 2018 1
Syllabus
NOTE: Where it is feasible, a syllabus (headnote) will be released, as is being done in connection with this case, at the time the opinion is issued. The syllabus constitutes no part of the opinion of the Court but has been prepared by the Reporter of Decisions for the convenience of the reader. See United States v. Detroit Timber & Lumber Co., 200 U. S. 321, 337.
SUPREME COURT OF THE UNITED STATES

Syllabus
NEW PRIME INC. v. OLIVEIRA
CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR
THE FIRST CIRCUIT
No. 17–340. Argued October 3, 2018—Decided January 15, 2019

Petitioner New Prime Inc. is an interstate trucking company, and respondent Dominic Oliveira is one of its drivers. Mr. Oliveira works under an operating agreement that calls him an independent con- tractor and contains a mandatory arbitration provision. When Mr. Oliveira filed a class action alleging that New Prime denies its drivers lawful wages, New Prime asked the court to invoke its statutory authority under the Federal Arbitration Act to compel arbitration. Mr. Oliveira countered that the court lacked authority because §1 of the Act excepts from coverage disputes involving “contracts of employment” of certain transportation workers. New Prime insisted that any question regarding §1’s applicability belonged to the arbitrator alone to resolve, or, assuming the court could address the ques- tion, that “contracts of employment” referred only to contracts that establish an employer-employee relationship and not to contracts with independent contractors. The District Court and First Circuit agreed with Mr. Oliveira.

Held:
1. A court should determine whether a §1 exclusion applies before ordering arbitration. A court’s authority to compel arbitration under the Act does not extend to all private contracts, no matter how emphatically they may express a preference for arbitration. Instead, antecedent statutory provisions limit the scope of a court’s §§3 and 4 powers to stay litigation and compel arbitration “accord[ing to] the terms” of the parties’ agreement. Section 2 provides that the Act applies only when the agreement is set forth as “a written provision in any maritime transaction or a contract evidencing a transaction involving commerce.” And §1 helps define §2’s terms, warning, as relevant here, that “nothing” in the Act “shall apply” to “contracts of employment of seamen, railroad employees, or any other class of workers engaged in foreign or interstate commerce.” For a court to invoke its statutory authority under §§3 and 4, it must first know if the parties’ agreement is excluded from the Act’s coverage by the terms of §§1 and 2. This sequencing is significant. See,
e.g., Bernhardt v. Polygraphic Co. of America, 350 U. S. 198, 201–202. New Prime notes that the parties’ contract contains a “delegation clause,” giving the arbitrator authority to decide threshold questions of arbitrability, and that the “severability principle” requires that both sides take all their disputes to arbitration. But a delegation clause is merely a specialized type of arbitration agreement and is enforceable under §§3 and 4 only if it appears in a contract consistent with §2 that does not trigger §1’s exception. And, the Act’s severability principle applies only if the parties’ arbitration agreement appears in a contract that falls within the field §§1 and 2 describe. Pp. 3–6. 

2. Because the Act’s term “contract of employment” refers to any agreement to perform work, Mr. Oliveira’s agreement with New Prime falls within §1’s exception. Pp. 6–15. 

(a) “[I]t’s a ‘fundamental canon of statutory construction’ that words generally should be ‘interpreted as taking their ordinary . . . meaning . . . at the time Congress enacted the statute.’ ” Wisconsin Central Ltd. v. United States, 585 U. S. ___, ___ (quoting Perrin v. United States, 444 U. S. 37, 42). After all, if judges could freely in- vest old statutory terms with new meanings, this Court would risk amending legislation outside the “single, finely wrought and exhaustively considered, procedure” the Constitution commands. INS v. Chadha, 462 U. S. 919, 951. The Court would risk, too, upsetting reliance interests by subjecting people today to different rules than they enjoyed when the statute was passed. At the time of the Act’s adoption in 1925, the phrase “contract of employment” was not a term of art, and dictionaries tended to treat “employment” more or less as a synonym for “work.” Contemporaneous legal authorities provide no evidence that a “contract of employment” necessarily signaled a formal employer-employee relationship. Evidence that Con- gress used the term “contracts of employment” broadly can be found in its choice of the neighboring term “workers,” a term that easily embraces independent contractors. Pp. 6–10. 

(b) New Prime argues that by 1925, the words “employee” and “independent contractor” had already assumed distinct meanings. But while the words “employee” and “employment” may share a common root and intertwined history, they also developed at different times and in at least some different ways. The evidence remains that, as dominantly understood in 1925, a “contract of employment” did not necessarily imply the existence of an employer-employee relationship. New Prime’s argument that early 20th-century courts sometimes used the phrase “contracts of employment” to describe what are recognized today as agreements between employers and employees does nothing to negate the possibility that the term also embraced agreements by independent contractors to perform work. And its effort to explain away the statute’s suggestive use of the term “worker” by noting that the neighboring terms “seamen” and “rail- road employees” included only employees in 1925 rests on a precarious premise. The evidence suggests that even “seamen” and “railroad employees” could be independent contractors at the time the Arbitration Act passed. Left to appeal to the Act’s policy, New Prime suggests that this Court order arbitration to abide Congress’ effort to counteract judicial hostility to arbitration and establish a favorable federal policy toward arbitration agreements. Courts, however, are not free to pave over bumpy statutory texts in the name of more expeditiously advancing a policy goal. Rather, the Court should respect “the limits up to which Congress was prepared” to go when adopting the Arbitration Act. United States v. Sisson, 399 U. S. 267, 298. This Court also declines to address New Prime’s suggestion that it order arbitration anyway under its inherent authority to stay litigation in favor of an alternative dispute resolution mechanism of the parties’ choosing. Pp. 10–15.
857 F. 3d 7, affirmed.

GORSUCH, J., delivered the opinion of the Court, in which all other Members joined, except KAVANAUGH, J., who took no part in the consideration or decision of the case. GINSBURG, J., filed a concurring opinion.
Cite as: 586 U. S. ____ (2019) 1
Opinion of the Court
NOTICE: This opinion is subject to formal revision before publication in the preliminary print of the United States Reports. Readers are requested to notify the Reporter of Decisions, Supreme Court of the United States, Wash- ington, D. C. 20543, of any typographical or other formal errors, in order that corrections may be made before the preliminary print goes to press.

SUPREME COURT OF THE UNITED STATES
_________________
No. 17–340 _________________
NEW PRIME INC., PETITIONER v. DOMINIC OLIVEIRA
ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE FIRST CIRCUIT
[January 15, 2019]

JUSTICE GORSUCH delivered the opinion of the Court.

The Federal Arbitration Act requires courts to enforce private arbitration agreements. But like most laws, this one bears its qualifications. Among other things, §1 says that “nothing herein” may be used to compel arbitration in disputes involving the “contracts of employment” of certain transportation workers. 9 U. S. C. §1. And that qualification has sparked these questions: When a contract delegates questions of arbitrability to an arbitrator, must a court leave disputes over the application of §1’s exception for the arbitrator to resolve? And does the term “contracts of employment” refer only to contracts between employers and employees, or does it also reach contracts with independent contractors? Because courts across the country have disagreed on the answers to these questions, we took this case to resolve them.



New Prime is an interstate trucking company and Dominic Oliveira works as one of its drivers. But, at least on paper, Mr. Oliveira isn’t an employee; the parties’ contracts label him an independent contractor. Those agreements also instruct that any disputes arising out of the parties’ relationship should be resolved by an arbitrator— even disputes over the scope of the arbitrator’s authority. 

Eventually, of course, a dispute did arise. In a class action lawsuit in federal court, Mr. Oliveira argued that New Prime denies its drivers lawful wages. The company may call its drivers independent contractors. But, Mr. Oliveira alleged, in reality New Prime treats them as employees and fails to pay the statutorily due minimum wage. In response to Mr. Oliveira’s complaint, New Prime asked the court to invoke its statutory authority under the Act and compel arbitration according to the terms found in the parties’ agreements.

That request led to more than a little litigation of its own. Even when the parties’ contracts mandate arbitration, Mr. Oliveira observed, the Act doesn’t always authorize a court to enter an order compelling it. In particular, §1 carves out from the Act’s coverage “contracts of em- ployment of . . . workers engaged in foreign or interstate commerce.” And at least for purposes of this collateral dispute, Mr. Oliveira submitted, it doesn’t matter whether you view him as an employee or independent contractor. Either way, his agreement to drive trucks for New Prime qualifies as a “contract[ ] of employment of . . . [a] worker[ ] engaged in . . . interstate commerce.” Accordingly, Mr. Oliveira argued, the Act supplied the district court with no authority to compel arbitration in this case. 

Naturally, New Prime disagreed. Given the extraordinary breadth of the parties’ arbitration agreement, the company insisted that any question about §1’s application belonged for the arbitrator alone to resolve. Alternatively and assuming a court could address the question, New Prime contended that the term “contracts of employment” refers only to contracts that establish an employer- employee relationship. And because Mr. Oliveira is, in fact as well as form, an independent contractor, the company argued, §1’s exception doesn’t apply; the rest of the statute does; and the district court was (once again) required to order arbitration.

Ultimately, the district court and the First Circuit sided with Mr. Oliveira. 857 F. 3d 7 (2017). The court of appeals held, first, that in disputes like this a court should resolve whether the parties’ contract falls within the Act’s ambit or §1’s exclusion before invoking the statute’s authority to order arbitration. Second, the court of appeals held that §1’s exclusion of certain “contracts of employment” removes from the Act’s coverage not only employer- employee contracts but also contracts involving independent contractors. So under any account of the parties’ agreement in this case, the court held, it lacked authority under the Act to order arbitration. 

II 

In approaching the first question for ourselves, one thing becomes clear immediately. While a court’s authority under the Arbitration Act to compel arbitration may be considerable, it isn’t unconditional. If two parties agree to arbitrate future disputes between them and one side later seeks to evade the deal, §§3 and 4 of the Act often require a court to stay litigation and compel arbitration “accord[ing to] the terms” of the parties’ agreement. But this authority doesn’t extend to all private contracts, no matter how emphatically they may express a preference for arbitration. 

Instead, antecedent statutory provisions limit the scope of the court’s powers under §§3 and 4. Section 2 provides that the Act applies only when the parties’ agreement to arbitrate is set forth as a “written provision in any maritime transaction or a contract evidencing a transaction involving commerce.” And §1 helps define §2’s terms. Most relevant for our purposes, §1 warns that “nothing” in the Act “shall apply” to “contracts of employment of seamen, railroad employees, or any other class of workers engaged in foreign or interstate commerce.” Why this very particular qualification? By the time it adopted the Arbitration Act in 1925, Congress had already prescribed alternative employment dispute resolution regimes for many transportation workers. And it seems Congress “did not wish to unsettle” those arrangements in favor of what- ever arbitration procedures the parties’ private contracts might happen to contemplate. Circuit City Stores, Inc. v. Adams, 532 U. S. 105, 121 (2001). 

Given the statute’s terms and sequencing, we agree with the First Circuit that a court should decide for itself whether §1’s “contracts of employment” exclusion applies before ordering arbitration. After all, to invoke its statutory powers under §§3 and 4 to stay litigation and compel arbitration according to a contract’s terms, a court must first know whether the contract itself falls within or beyond the boundaries of §§1 and 2. The parties’ private agreement may be crystal clear and require arbitration of every question under the sun, but that does not necessarily mean the Act authorizes a court to stay litigation and send the parties to an arbitral forum.
Nothing in our holding on this score should come as a surprise. We’ve long stressed the significance of the statute’s sequencing. In Bernhardt v. Polygraphic Co. of America, 350 U. S. 198, 201–202 (1956), we recognized that “Sections 1, 2, and 3 [and 4] are integral parts of a whole. . . . [Sections] 1 and 2 define the field in which Congress was legislating,” and §§3 and 4 apply only to contracts covered by those provisions. In Circuit City, we acknowledged that “Section 1 exempts from the [Act] . . . contracts of employment of transportation workers.” 532 U. S., at 119. And in Southland Corp. v. Keating, 465 U. S. 1, 10–11, and n. 5 (1984), we noted that “the enforceability of arbitration provisions” under §§3 and 4 depends on whether those provisions are “part of a written maritime contract or a contract ‘evidencing a transaction involving commerce’” under §2—which, in turn, depends on the application of §1’s exception for certain “contracts of employment.” 

To be sure, New Prime resists this straightforward understanding. The company argues that an arbitrator should resolve any dispute over §1’s application because of the “delegation clause” in the parties’ contract and what is sometimes called the “severability principle.” A delegation clause gives an arbitrator authority to decide even the initial question whether the parties’ dispute is subject to arbitration. Rent-A-Center, West, Inc. v. Jackson, 561 U. S. 63, 68–69 (2010). And under the severability principle, we treat a challenge to the validity of an arbitration agreement (or a delegation clause) separately from a challenge to the validity of the entire contract in which it appears. Id., at 70–71. Unless a party specifically challenges the validity of the agreement to arbitrate, both sides may be required to take all their disputes—including disputes about the validity of their broader contract—to arbitration. Ibid. Applying these principles to this case, New Prime notes that Mr. Oliveira has not specifically challenged the parties’ delegation clause and submits that any controversy should therefore proceed only and immediately before an arbitrator. 

But all this overlooks the necessarily antecedent statutory inquiry we’ve just discussed. A delegation clause is merely a specialized type of arbitration agreement, and the Act “operates on this additional arbitration agreement just as it does on any other.” Id., at 70. So a court may use §§3 and 4 to enforce a delegation clause only if the clause appears in a “written provision in . . . a contract evidencing a transaction involving commerce” consistent with §2. And only if the contract in which the clause appears doesn’t trigger §1’s “contracts of employment” exception. In exactly the same way, the Act’s severability principle applies only if the parties’ arbitration agreement appears in a contract that falls within the field §§1 and 2 describe. We acknowledged as much some time ago, explaining that, before invoking the severability principle, a court should “determine[] that the contract in question is within the coverage of the Arbitration Act.” Prima Paint Corp. v. Flood & Conklin Mfg. Co., 388 U. S. 395, 402 (1967). 

III 

That takes us to the second question: Did the First Circuit correctly resolve the merits of the §1 challenge in this case? Recall that §1 excludes from the Act’s compass “contracts of employment of . . . workers engaged in . . . interstate commerce.” Happily, everyone before us agrees that Mr. Oliveira qualifies as a “worker[ ] engaged in . . . interstate commerce.” For purposes of this appeal, too, Mr. Oliveira is willing to assume (but not grant) that his contracts with New Prime establish only an independent contractor relationship. 

With that, the disputed question comes into clear view: What does the term “contracts of employment” mean? If it refers only to contracts that reflect an employer-employee relationship, then §1’s exception is irrelevant and a court is free to order arbitration, just as New Prime urges. But if the term also encompasses contracts that require an independent contractor to perform work, then the exception takes hold and a court lacks authority under the Act to order arbitration, exactly as Mr. Oliveira argues.



In taking up this question, we bear an important caution in mind. “[I]t’s a ‘fundamental canon of statutory construction’ that words generally should be ‘interpreted as taking their ordinary . . . meaning . . . at the time Congress enacted the statute.’” Wisconsin Central Ltd. v. United States, 585 U. S. ___, ___ (2018) (slip op., at 9) (quoting Perrin v. United States, 444 U. S. 37, 42 (1979)). See also Sandifer v. United States Steel Corp., 571 U. S. 220, 227 (2014). After all, if judges could freely invest old statutory terms with new meanings, we would risk amending legislation outside the “single, finely wrought and exhaustively considered, procedure” the Constitution commands. INS v. Chadha, 462 U. S. 919, 951 (1983). We would risk, too, upsetting reliance interests in the settled meaning of a statute. Cf. 2B N. Singer & J. Singer, Suth- erland on Statutes and Statutory Construction §56A:3 (rev. 7th ed. 2012). Of course, statutes may sometimes refer to an external source of law and fairly warn readers that they must abide that external source of law, later amendments and modifications included. Id., §51:8 (discussing the reference canon). But nothing like that exists here. Nor has anyone suggested any other appropriate reason that might allow us to depart from the original meaning of the statute at hand. 

That, we think, holds the key to the case. To many lawyerly ears today, the term “contracts of employment” might call to mind only agreements between employers and employees (or what the common law sometimes called masters and servants). Suggestively, at least one recently published law dictionary defines the word “employment” to mean “the relationship between master and servant.” Black’s Law Dictionary 641 (10th ed. 2014). But this modern intuition isn’t easily squared with evidence of the term’s meaning at the time of the Act’s adoption in 1925. At that time, a “contract of employment” usually meant nothing more than an agreement to perform work. As a result, most people then would have understood §1 to exclude not only agreements between employers and employees but also agreements that require independent contractors to perform work. 

What’s the evidence to support this conclusion? It turns out that in 1925 the term “contract of employment” wasn’t defined in any of the (many) popular or legal dictionaries the parties cite to us. And surely that’s a first hint the phrase wasn’t then a term of art bearing some specialized meaning. It turns out, too, that the dictionaries of the era consistently afforded the word “employment” a broad construction, broader than may be often found in dictionaries today. Back then, dictionaries tended to treat “employment” more or less as a synonym for “work.” Nor did they distinguish between different kinds of work or workers: All work was treated as employment, whether or not the common law criteria for a master-servant relationship happened to be satisfied.

What the dictionaries suggest, legal authorities confirm. This Court’s early 20th-century cases used the phrase “contract of employment” to describe work agreements involving independent contractors.2 Many state court cases did the same.3 So did a variety of federal statutes.4 And state stat-
——————
1See, e.g., 3 J. Murray, A New English Dictionary on Historical Principles 130 (1891) (defining “employment” as, among other things, “[t]he action or process of employing; the state of being employed. The service (of a person). That on which (one) is employed; business; occupation; a special errand or commission. A person’s regular occupation or business; a trade or profession”); 3 The Century Dic- tionary and Cyclopedia 1904 (1914) (defining “employment” as “[w]ork or business of any kind”); W. Harris, Webster’s New International Dictionary 718 (1st ed. 1909) (listing “work” as a synonym for “em- ployment”); Webster’s Collegiate Dictionary 329 (3d ed. 1916) (same); Black’s Law Dictionary 422 (2d ed. 1910) (“an engagement or render- ing services” for oneself or another); 3 Oxford English Dictionary 130 (1933) (“[t]hat on which (one) is employed; business; occupation; a special errand or commission”).
2 See, e.g., Watkins v. Sedberry, 261 U. S. 571, 575 (1923) (agree- ment between trustee and attorney to recover bankrupt’s property); Owen v. Dudley & Michener, 217 U. S. 488, 494 (1910) (agreement between Indian tribe and attorneys to pursue claims).
3 See, e.g., Lindsay v. McCaslin (Two Cases), 123 Me. 197, 200, 122 A. 412, 413 (1923) (“When the contract of employment has been reduced to writing, the question whether the person employed was an independent contractor or merely a servant is determined by the court as a matter of law”); Tankersley v. Webster, 116 Okla. 208, 210, 243 P.

utes too.5 We see here no evidence that a “contract of employment” necessarily signaled a formal employer-employee or master-servant relationship.

More confirmation yet comes from a neighboring term in the statutory text. Recall that the Act excludes from its coverage “contracts of employment of . . . any . . . class of workers engaged in foreign or interstate commerce.” 9 U. S. C. §1 (emphasis added). Notice Congress didn’t use the word “employees” or “servants,” the natural choices if  
——————
745, 747 (1925) (“[T]he contract of employment between Tankersley and Casey was admitted in evidence without objections, and we think conclusively shows that Casey was an independent contractor”); Waldron v. Garland Pocahontas Coal Co., 89 W. Va. 426, 427, 109 S. E. 729 (1921) (syllabus) (“Whether a person performing work for another is an independent contractor depends upon a consideration of the contract of employment, the nature of the business, the circum- stances under which the contract was made and the work was done”); see also App. to Brief for Respondent 1a–12a (citing additional examples).
4See, e.g., Act of Mar. 19, 1924, ch. 70, §5, 43 Stat. 28 (limiting payment of fees to attorneys “employed” by the Cherokee Tribe to litigate claims against the United States to those “stipulated in the contract of employment”); Act of June 7, 1924, ch. 300, §§2, 5, 43 Stat. 537–538 (providing same for Choctaw and Chickasaw Tribes); Act of Aug. 24, 1921, ch. 89, 42 Stat. 192 (providing that no funds may be used to compensate “any attorney, regular or special, for the United States Shipping Board or the United States Shipping Board Emergency Fleet Corporation unless the contract of employment has been approved by the Attorney General of the United States”). See also App. to Brief for Respondent 13a (citing additional examples).
5 See, e.g., Act of Mar. 10, 1909, ch. 70, §1, 1909 Kan. Sess. Laws p. 121 (referring to “contracts of employment of auditors, accountants, engineers, attorneys, counselors and architects for any special pur- pose”); Act of Mar. 4, 1909, ch. 4, §4, 1909 Okla. Sess. Laws p. 118 (“Should the amount of the attorney’s fee be agreed upon in the contract of employment, then such attorney’s lien and cause of action against such adverse party shall be for the amount so agreed upon”); Act of Mar. 4, 1924, ch. 88, §1, 1924 Va. Acts ch. 91 (allowing extension of “contracts of employment” between the state and contractors with respect to the labor of prisoners); App. to Brief for Respondent 14a–15a (citing additional examples).

the term “contracts of employment” addressed them alone. Instead, Congress spoke of “workers,” a term that everyone agrees easily embraces independent contractors. That word choice may not mean everything, but it does supply further evidence still that Congress used the term “contracts of employment” in a broad sense to capture any contract for the performance of work by workers.



What does New Prime have to say about the case building against it? Mainly, it seeks to shift the debate from the term “contracts of employment” to the word “employee.” Today, the company emphasizes, the law often distinguishes between employees and independent contractors. Employees are generally understood as those who work “in the service of another person (the employer) under an express or implied contract of hire, under which the employer has the right to control the details of work performance.” Black’s Law Dictionary, at 639. Meanwhile, independent contractors are sometimes described as those “entrusted to undertake a specific project but who [are] left free to do the assigned work and to choose the method for accomplishing it.” Id., at 888. New Prime argues that, by 1925, the words “employee” and “independent contractor” had already assumed these distinct meanings.6 And given that, the company contends, the phrase “contracts of employment” should be understood to refer only to relationships between employers and employees.

Unsurprisingly, Mr. Oliveira disagrees. He replies that, while the term “employment” dates back many centuries, the word “employee” only made its first appearance in English in the 1800s. See Oxford English Dictionary (3d ed., Mar. 2014), www.oed.com/view/Entry/61374 (all In-
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6 See, e.g., Atlantic Transp. Co. v. Coneys, 82 F. 177, 178 (CA2 1897); Nyback v. Champagne Lumber Co., 109 F. 732, 741 (CA7 1901).

ternet materials as last visited Jan. 9, 2019). At that time, the word from which it derived, “employ,” simply meant to “apply (a thing) to some definite purpose.” 3 J. Murray, A New English Dictionary on Historical Principles 129 (1891). And even in 1910, Black’s Law Dictionary reported that the term “employee” had only “become somewhat naturalized in our language.” Black’s Law Dictionary 421 (2d ed. 1910).

Still, the parties do share some common ground. They agree that the word “employee” eventually came into wide circulation and came to denote those who work for a wage at the direction of another. They agree, too, that all this came to pass in part because the word “employee” didn’t suffer from the same “historical baggage” of the older common law term “servant,” and because it proved useful when drafting legislation to regulate burgeoning industries and their labor forces in the early 20th century.7 The parties even agree that the development of the term “employee” may have come to influence and narrow our understanding of the word “employment” in comparatively recent years and may be why today it might signify to some a “relationship between master and servant.”8  
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7See Carlson, Why the Law Still Can’t Tell an Employee When It Sees One and How It Ought To Stop Trying, 22 Berkeley J. Emp. & Lab. L. 295, 309 (2001) (discussing the “historical baggage” of the term “servant”); Broden, General Rules Determining the Employment Relationship Under Social Security Laws: After Twenty Years an Unsolved Problem, 33 Temp. L. Q. 307, 327 (1960) (describing use of the term “employer-employee,” in contradistinction to “master-servant,” in the Social Security laws). Legislators searched to find a term that fully encompassed the broad protections they sought to provide and considered an “assortment of vague and uncertain terms,” including “ ‘servant,’ . . . ‘employee,’ . . . ‘workman,’ ‘laborer,’ ‘wage earner,’ ‘opera- tive,’ or ‘hireling.’” Carlson, 22 Berkeley J. Emp. & Lab. L., at 308. Eventually “ ‘employee’ prevailed, if only by default, and the choice was confirmed by the next wave of protective legislation—workers’ compen- sation laws in the early years of the Twentieth Century.” Id., at 309.
8 Black’s Law Dictionary 641 (10th ed. 2014); see also P. Durkin, Re-

But if the parties’ extended etymological debate persuades us of anything, it is that care is called for. The words “employee” and “employment” may share a common root and an intertwined history. But they also developed at different times and in at least some different ways. The only question in this case concerns the meaning of the term “contracts of employment” in 1925. And, whatever the word “employee” may have meant at that time, and however it may have later influenced the meaning of “employment,” the evidence before us remains that, as dominantly understood in 1925, a contract of employment did not necessarily imply the existence of an employer- employee or master-servant relationship. 

When New Prime finally turns its attention to the term in dispute, it directs us to Coppage v. Kansas, 236 U. S. 1, 13 (1915). There and in other cases like it, New Prime notes, courts sometimes used the phrase “contracts of employment” to describe what today we’d recognize as agreements between employers and employees. But this proves little. No one doubts that employer-employee agreements to perform work qualified as “contracts of employment” in 1925—and documenting that fact does nothing to negate the possibility that “contracts of em- ployment” also embraced agreements by independent contractors to perform work. Coming a bit closer to the mark, New Prime eventually cites a handful of early 20th-century legal materials that seem to use the term “contracts of employment” to refer exclusively to employer- employee agreements.9 But from the record amassed
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lease Notes: The Changes in Empathy, Employ, and Empire (Mar. 13, 2014) (“Over time” the meaning of several employ-related words have “reflect[ed] changes in the world of work” and their meaning “shows an increasingly marked narrowing”), online at https://public.oed.com/blog/ march-2014-update-release-notes/.
9See, e.g., 1 T. Conyngton, Business Law: A Working Manual of Every-day Law 302–303 (2d ed. 1920); Newland v. Bear, 218 App. Div.

before us, these authorities appear to represent at most the vanguard, not the main body, of contemporaneous usage. 

New Prime’s effort to explain away the statute’s suggestive use of the term “worker” proves no more compelling. The company reminds us that the statute excludes “con- tracts of employment” for “seamen” and “railroad employees” as well as other transportation workers. And because “seamen” and “railroad employees” included only employ- ees in 1925, the company reasons, we should understand “any other class of workers engaged in ... interstate commerce” to bear a similar construction. But this argument rests on a precarious premise. At the time of the Act’s passage, shipboard surgeons who tended injured sailors were considered “seamen” though they likely served in an independent contractor capacity.10 Even the term “railroad employees” may have swept more broadly at the time of the Act’s passage than might seem obvious today. In 1922, for example, the Railroad Labor Board interpreted the word “employee” in the Transportation Act of 1920 to refer to anyone “engaged in the customary work directly contributory to the operation of the railroads.”11 And the Erdman Act, a statute enacted to address disruptive railroad strikes at the end of the 19th century, seems to evince an equally broad understanding of “railroad
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308, 309, 218 N. Y. S. 81, 81–82 (1926); Anderson v. State Indus. Accident Comm’n, 107 Ore. 304, 311–312, 215 P. 582, 583, 585 (1923); N. Dosker, Manual of Compensation Law: State and Federal 8 (1917).
10 See, e.g., The Sea Lark, 14 F. 2d 201 (WD Wash. 1926); The Buena Ventura, 243 F. 797, 799 (SDNY 1916); Holt v. Cummings, 102 Pa. 212, 215 (1883); Allan v. State S. S. Co., 132 N. Y. 91, 99, 30 N. E. 482, 485 (1892) (“The work which the physician does after the vessel starts on the voyage is his and not the ship owner’s”).
11 Transportation Act of 1920, §§304, 307, 41 Stat. 456; Railway Em- ployees’ Dept., A. F. of L. v. Indiana Harbor Belt R. Co., Decision No. 982, 3 R. L. B. 332, 337 (1922).

employees.”12

Unable to squeeze more from the statute’s text, NewPrime is left to appeal to its policy. This Court has said that Congress adopted the Arbitration Act in an effort to counteract judicial hostility to arbitration and establish “a liberal federal policy favoring arbitration agreements.” Moses H. Cone Memorial Hospital v. Mercury Constr. Corp., 460 U. S. 1, 24 (1983). To abide that policy, New Prime suggests, we must order arbitration according to the terms of the parties’ agreement. But often and by design it is “hard-fought compromise[],” not cold logic, that supplies the solvent needed for a bill to survive the legislative process. Board of Governors, FRS v. Dimension Financial Corp., 474 U. S. 361, 374 (1986). If courts felt free to pave over bumpy statutory texts in the name of more expeditiously advancing a policy goal, we would risk failing to “tak[e] . . . account of ” legislative compromises essential to a law’s passage and, in that way, thwart rather than honor “the effectuation of congressional intent.” Ibid. By respecting the qualifications of §1 today, we “respect the limits up to which Congress was prepared” to go when adopting the Arbitration Act. United States v. Sisson, 399 U. S. 267, 298 (1970). 

Finally, and stretching in a different direction entirely, New Prime invites us to look beyond the Act. Even if the statute doesn’t supply judges with the power to compel arbitration in this case, the company says we should order it anyway because courts always enjoy the inherent au-
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12The Act provided for arbitration between railroads and workers, and defined “employees” as “all persons actually engaged in any capacity in train operation or train service of any description.” Act of June 1, 1898, ch. 370, 30 Stat. 424. The Act also specified that the railroads would “be responsible for the acts and defaults of such employees in the same manner and to the same extent as if . . . said employees [were] directly employed by it.” Id., at 425. See Dempsey, Transportation: A Legal History, 30 Transp. L. J. 235, 273 (2003).

thority to stay litigation in favor of an alternative dispute resolution mechanism of the parties’ choosing. That, though, is an argument we decline to tangle with. The courts below did not address it and we granted certiorari only to resolve existing confusion about the application of the Arbitration Act, not to explore other potential avenues for reaching a destination it does not.
*
When Congress enacted the Arbitration Act in 1925, the term “contracts of employment” referred to agreements to perform work. No less than those who came before him, Mr. Oliveira is entitled to the benefit of that same understanding today. Accordingly, his agreement with New Prime falls within §1’s exception, the court of appeals was correct that it lacked authority under the Act to order arbitration, and the judgment is
Affirmed.

JUSTICE KAVANAUGH took no part in the consideration or decision of this case.

Cite as: 586 U. S. ____ (2019) 1 GINSBURG, J., concurring
SUPREME COURT OF THE UNITED STATES
_________________
No. 17–340 _________________
NEW PRIME INC., PETITIONER v. DOMINIC OLIVEIRA
ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE FIRST CIRCUIT
[January 15, 2019]

JUSTICE GINSBURG, concurring. 

“[W]ords generally should be ‘interpreted as taking their ordinary . . . meaning . . . at the time Congress enacted the statute.’” Ante, at 6 (quoting Wisconsin Central Ltd. v. United States, 585 U. S. ___, ___ (2018) (slip op., at 9)). The Court so reaffirms, and I agree. Looking to the period of enactment to gauge statutory meaning ordinarily fosters fidelity to the “regime . . . Congress established.” MCI Telecommunications Corp. v. American Telephone & Tele- graph Co., 512 U. S. 218, 234 (1994). 

Congress, however, may design legislation to govern changing times and circumstances. See, e.g., Kimble v. Marvel Entertainment, LLC, 576 U. S. ___, ___ (2015) (slip op., at 14) (“Congress . . . intended [the Sherman Antitrust Act’s] reference to ‘restraint of trade’ to have ‘changing content,’ and authorized courts to oversee the term’s ‘dynamic potential.’” (quoting Business Electronics Corp. v. Sharp Electronics Corp., 485 U. S. 717, 731732 (1988))); SEC v. Zandford, 535 U. S. 813, 819 (2002) (In enacting the Securities Exchange Act, “Congress sought to substitute a philosophy of full disclosure for the philosophy of caveat emptor . . . . Consequently, . . . the statute should be construed not technically and restrictively, but flexibly to effectuate its remedial purposes.” (internal quotation marks and paragraph break omitted)); H. J. Inc. v. Northwestern Bell Telephone Co., 492 U. S. 229, 243 (1989) (“The limits of the relationship and continuity concepts that combine to define a [Racketeer Influenced and Corrupt Organizations] pattern . . . cannot be fixed in advance with such clarity that it will always be apparent whether in a particular case a ‘pattern of racketeering activity’ exists. The development of these concepts must await future cases . . . .”). As these illustrations suggest, sometimes, “[w]ords in statutes can enlarge or contract their scope as other changes, in law or in the world, require their application to new instances or make old applications anachronistic.”West v. Gibson, 527 U. S. 212, 218 (1999).

Update on Teaching Forum/Scholar's Association intervention on Facebook's Scholar Initiative

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Joanne Bauer, Co-Director of the Teaching Forum, and Michael Santoro, President of the Scholars Association, make public a letter privately communicated to Facebook executives expressing concerns about the exclusion of business and human rights experts in its scholars initiative.
We believe that the absence of business and human rights expertise within the Initiative is a missed opportunity and diminishes the capacity of the Initiative. The message of our original letter to Schrage and Ginsberg about the value of a business and human rights analysis to address the ethical and public policy issues raised by Facebook’s data access policies remains as salient today as when we sent it last May, and therefore we have chosen today to share it publicly. (Teaching Business and Human Rights Forum and Global Business and Human Rights Scholars Association Release Letter Raising Concerns about Facebook’s Electoral Integrity Initiative).
I am happy to pass along additional information and links, which follow. 


Some of you may recall that last April I posted here about the public announcement of Eliot Schrage, then Facebook's Vice President of Communications and Public Policy, regarding a new Facebook initiative to grant scholars access to Facebook data and internal processes in order to facilitate scholarly research on the impact of social media on elections. Given how squarely this subject fits within the concerns of the business and human rights field, my post asked if anyone would like to get together to discuss how we might respond. About a dozen of you responded and following a Zoom call, together with the Global Business and Human Rights Scholars Association, we drafted a letter to Facebook with our ask: namely, that at least one business and human rights scholar be appointed to sit on the Commission that develops the RFPs and vets the resulting proposals. Over 50 members of the Teaching Forum and the Scholars Association signed the letter, which we emailed to Facebook in May.


Earlier this week, Michael Santoro (President of the Scholars Association) and I publicly released the letter along with an explanation of the communcations we had with the directors of the Facebook initiative after we submitted the letter. The cover note also explains the disappointing outcome: no BHR expert had been appointed to either the Commission or any of the sub-committees.


On Monday the letter with cover note was posted on the Scholars Association website and in its newsletter. Here is the link: https://bhrscholarsassociation.org/facebook-letter/ Feel free to share on social media.


We welcome your thoughts on this. Since our original outreach was to Facebook via Schrage (who is no longer there) and David Ginsberg, if we do pursue this further we intend to do so directly with Facebook. We expect that conversation will be easier to have once Facebook's new Human Rights Policy Director comes on board.

Human Rights Without Chinese Characteristics and Global Production Chains Within China: Xinjiang and Badger Sportswear as a Harbinger of Dissonance in Human Rights Risk Management

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What happens when the trajectories of Chinese Socialist Human Rights  and the emerging global consensus on business and human rights responsibilities in global production chains collide?  That is a question that used to be academic.  The more muscular development of the premises of Socialist Human Rights has been occurring at about the same time that the structures of business and human rights around key frameworks--the U.N. Guiding Principles for Business and Human Rights and the OECD Guidelines for Multinational Enterprises, long with its dispute mechanism have also become far more important in the way that enterprises manage compliance and risk in their operations everywhere. 

Recent events have suggested  what global trade might expect when these two great forces collide.
A US sportswear company has stopped using a Chinese supplier following concerns it was using forced labour in camps in Xinjiang. Badger Sportswear, a company based in North Carolina, said it would stop sourcing clothing from Hetian Taida in north-western China. The company said in a statement posted on its website on Wednesday: “Out of an abundance of caution and to eliminate any concerns about our supply chain given the controversy around doing business in north-western China, we will no longer source any product from Hetian Taida or this region of China.” (US clothing company drops Chinese supplier over Xinjiang forced labour concerns)
While the early years of developing consensus practices around supply chain human rights responsibilities had focused on the developing world, conflict and weak governance zones, it appears that such principles may be applied now to manage the supply chain practices of enterprises in all states.  

This post considers the consequences and implications of Badger Sportswear's decision to cease its relationship with a Xinjiang supplier.  Brief reflections follow.  




China has been developing its own Socialist Human Rights, one deeply embedded within the political and economic ideology of the Chinese state. These have begun to take distinctive form after the 19th Chinese Communist Party (CPC)  Congress and the official recognition of the new era of Chinese development. Socialist Human Rights is closely tied to national context, one that rejects the possibility of universal standards beyond general principles.
There is no universal road for the development of human rights in the world. As an important element in the economic and social development of each country, the cause of human rights must be promoted on the basis of the national conditions and the needs of the people of that country, and cannot be defined on the basis of a single authority. (UN Working Group on the Universal Period Review, National report submitted in accordance with paragraph 5 of the annex to Human Rights Council resolution 16/21-- China (A/HRC/WG.6/31/CHN/1) , ¶ 4).
Its rights based approach developed for the Chinese context has also been proffered to the rest of the world as an alternative basis for the ordering of international relations, including human rights: "China proposes to build a new type of international relationship featuring mutual respect, fairness, justice and win-win cooperation, to build a community with a shared future for mankind, and to provide a Chinese proposal for promoting the healthy development of the international cause of human rights." (Ibid., ¶10).  These efforts have been bearing fruit in the reconstruction of the normative basis for human rights within the architecture of the UN's Geneva baaed Human Rights Council (see, On the Internationalization of China's "New Era" Theory: Brief Thoughts on the UN Human Rights Council Resolution: "On promoting mutually beneficial cooperation in the field of human rights" (A/HRC/37/L.36)).

But China's approach has not gone criticized outside of China and with direct connection to Chinese self assessment before UN monitoring bodies (see,  Working Group on the Universal Periodic Review, Summary of Stakeholders’ submissions on China, Report of the Office of the United Nations High Commissioner for Human Right). Though that criticism itself has generated harsh responses from the Chinese state organs (e.g., China says UN criticism of human rights record is 'politically driven' ("“We will not accept the politically driven accusations from a few countries that are fraught with biases, with total disregard for facts,” said vice foreign minister Le Yucheng. “No country shall dictate the definition of democracy and human rights,” he said.")).


That trajectory of development appears to present challenges to Chinese autonomy in the construction of its own approach to human rights where Chinese state organs or its enterprises participate in global production.  The issue in those areas, of course, is that Chinese principles and implementation standards may not be compatible to those imposed on or adopted by non-Chinese enterprises operating some or all of their production in or through China. I have suggested the contours of that contradiction and the challenges it may pose to states like Cuba (and China) in other work.
It is becoming increasingly impossible for Cuba to have it both ways--a free hand in applying its own ideological framework internally, while at the same time conforming to a different set of rules in global markets. First, even in its state to state relations, Cuba is finding it hard to avoid efforts to incorporate global standards into economic activity within Cuba that involves foreign partners.. . . Second, Cuba may have little choice but to comply with international standards, as those are applied outside of Cuba, when Cuba engages in economic activity abroad. (Cuba's Caribbean Marxism: Essays on Ideology, Government, Society, and Economy in the Post Fidel Castro Era (Chapter 11 on "Reform and Global Corporate Social Responsibility") introduction available here)
These contradictions are now beginning to show themselves in the investment decisions of non-Chinese firms.  The context is the highly controversial (outside of China) policy of the Chinese authorities  in the Xinjiang Autonomous Region.  Chinese human rights self assessment has noted this:
"Xinjiang has been carrying out “Year of Building People’s Livelihood” initiatives continuously since 2013, accounting for more than 70 per cent of its annual public budget expenditure. In 2017, the per capita disposable income of urban and rural residents in Xinjiang increased by 8.1 per cent and 8.5 per cent respectively, and urban and rural residents’ per capita housing area reached 85 square metres and 105 square metres respectively. The 15 years’ free education programme has been implemented in southern  Xinjiang, along with 3 years’ free bilingual preschool education in rural areas. (National report submitted in accordance with paragraph 5 of the annex to Human Rights Council resolution 16/21-- China (A/HRC/WG.6/31/CHN/1) , ¶ 75)
 But the view from state organs in the UNited States has been quite different (The Congressional-Executive Commission on China (CECC): Release of 2018 Annual Report; Making a Case for 'Crimes Against Humanity' Against China, and Text of Proposed “Xinjiang Uyghur Human Rights Act of 2018”.). That view finds echoes in other places outside of China as well.
Germany called on China to “end all unlawful detentions in Xinjiang,” while Iceland and Japan expressed concern about the rights of minorities in Xinjiang. Several states urged China allow UN observers into Xinjiang. The US called on China to abolish all internment camps in the far western territory and release the “possibly millions” detained there. Chinese delegates said internment centres were not re-education camps but vocational centres that offered free training in the law, language, and workplace skills. (China says UN criticism of human rights record is 'politically driven').
The U.K. has also become a vocal critic of Chinese state practices in the Xinjiang Autonomous Region. "British diplomats who visited Xinjiang have confirmed that reports of mass internment camps for Uighur Muslims were “broadly true”, the foreign secretary, Jeremy Hunt, has told parliament." (UK confirms reports of Chinese mass internment camps for Uighur Muslims).

This puts business enterprises in an awkward position.  From the perspective of the Chinese state there is nothing in its policies that suggests any need for human rights due diligence assessments with respect to business activities generally in China or more specifically in the Xinjiang Autonomous Region.  But enterprises outside of China, worried about both compliance throughout their operations and the mood of non-Chinese consumers and investors, worry that the continued and quite heated controversy over Xinjiang policy can affect their worldwide operations.  And int he West, the risk of liability extends where companies worry about being held complicit in the activities of the Chinese states by their own home governments or buy states in which they have substantial operations.

Beyond the difficulties of Specific Instance actions under the OECD Guidelines, and pressure by groups arguing that certain Chinese investment might breach a company's responsibility top respect human rights under the UNGP, companies might also fear investor action. Companies might worry that at some point investor activists, especially sovereign wealth funds, might begin to put pressure on them where they have operations that might expose them to scrutiny or adverse investor or consumer decisions.  The Norwegian Pension Fund Global and other European funds  have not yet but could develop positions in which Chinese activities might expose companies to exclusion from investment universes of these funds, or require potentially substantial reporting if they are put under observation (discussed here).


(Pix credit HERE)


The issue is not legal violation--but risk management and compliance (e.g., A Convergence of the Discourse of Business and of Human Rights?--The Turn to Oversight of Risk and Risk Cultures in Enterprise Management).  In the case of Badger Sportswear there appeared to be no question of legal compliance in their sourcing from Xinjiang facilities either under Chinese or U.S. law. The issue centered around their own internal governance systems--their domestic legal order for their production chain (on the domestic legal orders of supply chains see, e.g.,  Are Supply Chains Transnational Legal Orders?; and Economic Globalization and the Rise of Efficient Systems of Global Private Lawmaking).  Badger worried that the relationship violated its own internal Global Sourcing Policy.  That determination would have required careful balancing following the processes of human rights due diligence under the UNGP (¶¶17-22), had Badger thought to undertake its responsibilities fully in compliance with international standards (something that it was not required to do as a matter of law but which might have been treated as important under their compliance-risk management parameters).

Badger's Global Sourcing Policy  consists of a compilation of a number of key principles

Badger Sportswear is committed to a high standard of business ethics and complying with the laws and regulations of the countries in which it operates. When differences or conflicts in standards arise, we expect the highest standard be applied. We select partners who share this commitment and fully comply with our business codes of conduct and standard requirements as outlined below.

WORKING CONDITIONS

Badger Sportswear business partners must adopt and adhere to our commitment to providing a safe and healthy work environment for all employees. Workplaces are to adhere to all applicable national and international labor and social security laws, regulations and safety standards, report accidents, injuries and unsafe equipment, practices or conditions.

FORCED LABOR

Badger Sportswear prohibits business partners from engaging in forced labor, including prison, bonded, indentured, and other forms of forced labor.

FREEDOM OF ASSOCIATION AND COLLECTIVE BARGAINING

Employers shall recognize and respect the right of employees to freedom of association and collective bargaining.

CHILD LABOR

Badger Sportswear prohibits business partners from using child labor. Badger Sportswear defines child as any person employed under the age of 15 (or 14 where the law of the country permits), or under the age for completing compulsory education, or under the minimum age for employment in the country, whichever is higher.

HOURS OF WORK

Employers shall not require workers to work more than the regular and overtime hours allowed by the law of the country where employed.

COMPENSATION

Every worker has a right to compensation for a regular work week that is sufficient to meet the worker’s basic needs and provide some discretionary income. Employers shall pay at least the minimum wage or the appropriate prevailing wage, whichever is higher, comply with all legal requirements on wages, and provide any fringe benefits required by law or contract.

HARASSMENT OR ABUSE

Badger Sportswear expects that every employee shall be treated with respect and dignity. No employee shall be subject to any physical, sexual, psychological or verbal harassment or abuse.

DISCRIMINATION

Badger Sportswear will not tolerate harassment or discrimination by its business partners in hiring and employment practices, such as compensation, advancement, discipline, termination or retirement. There shall be no discrimination based on gender, race, color, ethnicity, religion, sexual orientation, disability, social group, age, or political beliefs.

HEALTH, SAFETY AND ENVIRONMENT

Badger Sportswear expects all partners to provide a safe and healthy workplace setting to prevent accidents and injury to health arising out of, lined with or occurring in the course of work or as a result of the operation of facilities. Badger Sportswear expects all partners to follow all applicable environmental laws and regulations. We encourage all operations to act responsibly and minimize adverse effects on the environment and natural resources, and help to ensure the health and safety of the public.

PRODUCT QUALITY

Badger Sportswear is committed to providing customers with the highest quality and value in our products. Our partners are expected to share this commitment and must enforce required operation practices necessary to meet our standard of quality.
The issue arose, as these things tend to do, when a highly visible and influential news outlet reported on the possibility that Badger's local supplier was using labor from camps that Chinese authorities had established to implement their policy objectives in Xinjiang. "Last month the New York Times reported that Badger had received a container of T-shirts from Hetian Taida, a company in Xinjiang shown on state television to have been using workers from re-education camps holding Muslim minorities"  (US clothing company drops Chinese supplier over Xinjiang forced labour concerns). 

Yet Badger also effectively undertook a form of UNGP human rights due diligence in response to receipt of reports that the Xinjiang facility operated by Hetian Taida Apparel Co., Ltd., was being operated contrary to its  Global Sourcing Policy. Rather than undertake the investigation themselves, Badger  chose to outsource its internal compliance.  The reasons were risk reducing--a third party with a good reputation would reduce the possibility that an internal investigation would have been discredited as self serving.  Badger chose Worldwide Responsible Accredited Production (WRAP) to conduct the review.

The review revealed no violation of policy ("we found those operations to be consistent with our Global Sourcing Policy"(Badger Sport Sourcing Update)).  One might have thought that would have concluded the matter,.  But their due diligence revealed more; and the company saw in what was revealed potential risk and compliance challenges.  That is, in the risk mitigating language of Badger, that  "historical documentation provided by Hetian Taida regarding their prior facility was insufficient to conclude with certainty that it had met Badger’s Global Sourcing Policy. " (Badger Sport Sourcing Update). It is not clear what that means in plain English--one would imagine that it took several lawyers and business officials some time to craft such obtuse language.  But the point was clear enough: it was too risky to do business there. That risk took two forms.  The first was a risk that the information provided by local suppliers was unreliable and that (reading between the lines) there was no grantee that political conditions would improve that situation. More important from a risk perspective, however, was the implied assessment that no matter what the evidence showed, popular sentiment among key consumer and investor stakeholders about Badger activity in Xinjiang might adversely affect their operations ("and to eliminate any concerns about our supply chain given the controversy around doing business in Northwestern China" (Badger Sport Sourcing Update)). 

This, then, is the global context in which the consequences of Chinese policy may play out.  The calculation is economic rather than political; but it points in the direction of markets and finance rather than on production costs to manufacture.  That calculus makes sense--one can (at sometimes great cost) move production, but customers and financial relationships are much harder to substitute. For China, like Cuba, in this context of dissonance among different views of human rights compatible behaviors, political choices will have economic effect.  For China, the solution may well be found in its Belt and Road Initiative--that building a its own global production chains that can serve as a hedge against these  sorts of actions. But that comes at a cost as well.

The Badger Sport ware Update follows below

__________

Badger Sport Sourcing Update

Recent media reports contained serious allegations that a facility located in Northwestern China operated by one of Badger’s third-party suppliers was acting in a manner inconsistent with our Global Sourcing Policy.

Upon hearing these press reports, we immediately suspended ordering, receiving or shipping any product from the supplier, Hetian Taida Apparel Co., Ltd., and launched a multi-faceted investigation. This process included internal reviews and an investigation conducted by outside legal counsel working with a global forensic accounting firm.

Our investigation is now complete. With respect to the current Hetian Taida facility in the Aidelaisi Industry Zone, we found those operations to be consistent with our Global Sourcing Policy and the certification by Worldwide Responsible Accredited Production (WRAP), an independent, non-profit team of global social compliance experts dedicated to promoting safe, lawful, humane, and ethical manufacturing around the world. However, historical documentation provided by Hetian Taida regarding their prior facility was insufficient to conclude with certainty that it had met Badger’s Global Sourcing Policy.

Therefore, out of an abundance of caution and to eliminate any concerns about our supply chain given the controversy around doing business in Northwestern China, we will no longer source any product from Hetian Taida or this region of China. Furthermore, we will not ship any product sourced from Hetian Taida currently in our possession. Given this supplier only accounted for approximately one percent of our total annual sales, we do not expect any interruption in our service levels.

We take extremely seriously any allegations of a supplier not complying with our Global Sourcing Policy. We strive to adhere to the highest manufacturing standards, as we have done for the past 47 years without issue. We are committed to upholding our mission of "Quality for All", which has helped Badger become the trusted supplier to team dealers, decorators and apparel wholesalers throughout the U.S.

An American Eclogue on the Cuban Embargo: An Annotated Reflection on Nicholas Kristof "The embargo on Cuba failed. Let’s move on"

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"I’m not a Cuba expert, and I don’t know how this country will evolve." (Nicholas Kristof, "The embargo on Cuba failed. Let’s move on" syndicated 24 January 2019 Houston Chronicle Version).

It is the rare member of the influence leader elite has has failed to miss an opportunity to share views about Cuba in general or the Cuban Embargo (or the Blockade depending on one's political leanings and ideological loyalty/blinkers). Nicholas Kristof is not among them.   

Mr. Kristof has just distributed his musings about the Cuban embargo.  There is nothing particularly odd about the short essay.  It reads like decades of similar eclogues, this one tied to his vision of the Arcadia that is oh so near for the Americans and Cubans.  These are usually produced in the flush of a junket to Havana--and are just as usually forgotten.

In normal course I tend to ignore these musings of the thought leader class.  But this one is worth at least a little commentary, if only to better appreciate the fantasies of Mr. Kristof's version of Cuba's spiritual landscape.  

What follows is an annotated version of Mr. Kristof's eclogue. For more read my book: Cuba’s Caribbean Marxism: Essays on Ideology, Government, Society, and Economy in the Post Fidel Castro Era(Little Sir Press, 2018), discussed HERE.




(Pix © Larry Cataá Backer 2017)



Nicholas Kristof, "The embargo on Cuba failed. Let’s move on" syndicated 24 January 2019 Houston Chronicle Version
  
HAVANA — It has been 60 years since Fidel Castro marched into Havana, so it’s time for both Cuba and the United States to grow up. Let’s let Cuba be a normal country again.
I have always appreciated how the march of time inevitably requires change, if only to commemorate the march of time.  But it is as good a reason as any to trigger exercises in self reflection.  But that is entirely what this ecolgue attempts--an American inner monologue about a bilateral relationship.  And thus we start with the sort of arrogance--that it is for the Americans to decide and affect the terms of ths relationship--that tends to irritate. . . everyone. But it also suggests that beyond the pundit class, the aggregations we have come to understand as the American and Cuban ruling classes must "grow up", that is come to the same conclusions of the kindly Shepard as he looks at his Arcadia from the comfort of hus fabulously comfortable perch above. 

Cuba is neither the demonic tyranny conjured by some conservatives nor the heroic worker paradise romanticized by some on the left. It’s simply a tired little country, no threat to anyone, with impressive health care and education but a repressive police state and a dysfunctional economy. 
It is hard to get sympathy for one's argument when the discursive tactic of choice is high condescension.  And there is irony here--what distinguishes this from the much criticized remark by Mr. Trump  about Sh*thole countries? It is even more deliciously ironic because it was Mr. Kristof himself, just about a year ago who hoped to teach the rest of us a lesson about the "sh*thole country episode  (What We Can Learn From ‘S-Hole Countries’ criticizing"invidious insults aimed at entire continents and of stereotyping people from those continents."). But worse, in Mr. Kristof's world, Cuba, "a tired little country," is incapable of punching well above its weight in international public organizations, is incapable of projecting social power (for example through its medical programs) abroad, and is incapable of forging sometimes irritatingly potent regional blocs.  There may well be a lot of people who are irritated at that government and (as Mr. Kristof is himself an example) of our government. But to suggest a lack of threat (threat to whom? and how?--those are the more interesting questions ignored) is to expose a lack of thought.

Driving in from the airport, I saw billboards denouncing the American economic embargo as the “longest genocide in history.” That’s ridiculous. But the embargo itself is also absurd and counterproductive, accomplishing nothing but hurting the Cuban people — whom we supposedly aim to help. 
Aaahh, now it is revealed that indeed Mr. Kristof is in and seeks to write about Acadia, and his irritation that it is not as picture perfect as he might have thought possible if all kinds of conditions were to magically change.  This is the ssort of mindset that got Americans into so much trouble in Iraq in 2003, when the ruling intellentsia and its bureaucratic allies embraced the view that all that might be needed was an invasion and that Iraq would then immediately reboot into some (other) sort of Arcadia. But back to Mr. Kristof's car ride form the airport.  The inspiration for his eclogue was a set of visuals that have become an opaque feature of Cuban life--the billboards denouncing the American Embargo in lurid terms.  Mr. Kristof is of course offended--Americans are not in the habit of slow motion genocides; besides there are still plenty of people in Cuba--those thoe have not emigrated anyway. Still it provides the opening needed to repaint the Cuban Arcadia with exercises of American will.

After six decades, can’t we move on? Let’s drop the embargo but continue to push Havana on improving human rights and on dropping support for other oppressive regimes, like those in Venezuela and Nicaragua.
The rhetorical question is a tried trope, but no less effective for that.  But here it is used to set up the argument Mr. Kristof is about to make.  One starts with a consideration of the opposite of current condition in order to draw the discursive lines to get from here to there. The "here" is the Embargo," the "there"is a state of engaged engagement of the peculiarly American sort--pushing Havana to be more like us or at least less like them. /(it is an odd position given the earlier assumption that all that is needed to make Cuba behave like a nice middle class country is to stop being mean to it)  But can he manage that given his starting assumption--that all of this depends solely on the U.S. and the exercise of its will? (And thus my rhetorical trope. . . but not a mocking imitation).

Let’s make room for nuance: Cuba impoverishes its citizens and denies them political rights, but it does a good job providing basic education and keeping people healthy. Cuba’s official infant mortality rate is lower than America’s (its real rate may or may not be).
This is an American speaking; and it is a "speaking" that requires some justification for a position that appears to be against American moral (ideological) interests, as well as for the need to "push." This produces a reliance on the much used realpolitik stance.
I’m not a Cuba expert, and I don’t know how this country will evolve. But Cuba has a new president, Miguel Díaz-Canel, who is associated with experiments in opening up the economy. Fidel is gone and his brother Raúl is fading from the scene.
And here it is; the most interesting part of the essay.  It is the most interesting because it perfectly describes the context in which the American thought leader class operates as it seeks to manage mass opinion (and in the process use it to pressure bureaucrats and the politicians they manage). But the statements are at best naive.  One can take Mr. Kristof at his word about the depth of his country specific knowledge.  And that is telling for what comes next. Cuba doe shave a new president who was selected by the Communist Party of which he is a loyal and high rankling member,.  He is indeed associated with reform and opening up--but the every high ranking Communist Party official was as this initiative was at the center of the Communist Party's work since before 2011.  And, indeed, Fidel is dead, but Raúl remains First Secretary of the Communist Party and the effective leader of the country.  My growing fear is that this sort of naiveté has so infected the upper levels of the leader class in the United States that there are few capable of the sort of realistic thinking that Me. Kristof purports to champion. 

In the 1960s, we were scared of Cuba. We feared that neighboring countries would tumble like dominoes into the communist bloc, and the Soviet Union attempted to place on Cuba nuclear missiles that could have threatened America. But today even as those fears have dissipated, our policy has ossified.
If this was a session of therapy, this would be the thrilling bit where the patient finally reveals the source of pathology. I am not sure what one can say here other than it is hard to see the connection between the first and second sentence. It is certainly true that the fears of the 1960s have dissipated--but so have those of the 1980s etc.  Yet the release of historical fears says nothing about the structures of new challenges.  And from the American perspective there may well be something to be wary of.  At least that is what the National Security Strategy suggests.

President Barack Obama took the necessary step of re-establishing diplomatic relations and easing the embargo, but President Donald Trump reversed course and tightened things up again out of knee-jerk hostility to anything Cuban and anything Obaman.
 This paragraph reminds one that conclusions are all in the interpretive perspective in this case exaggerating both the value of the Obama initiative and the extent of the Trump retrenchment. Mr. Obama did start the process of normalization,  He was also quite clear about its limits--and he made it clear that it would be for Congress to dismantle the Embargo and that this would be dependent on internal reform.  Always useful to reread Mr. Obama's remarks during his visit to Cuba. At the same time, despite the bluster, Mr. Terump's retrenchment is more smoke than fire. And it is not clear how the Sonic Weapons scandal would have played out with a Democratic administration.  

Cuba is changing, albeit too slowly. About one-third of its labor force is now in the private sector, and this is just about the only part of the economy that is thriving. I stayed in one of the growing number of Airbnbs in Havana, and people were friendly, even if governments are not: When I said I was from the United States, I inevitably got a big grin and a reference to a cousin in Miami or New York or Cleveland.
It is always fun to extrapolate from personal experience, especially when it can be peppered with factoids.  The problem with factoids is that decontextualized one can hardly understand their impact. But some of this was personally cringeworthy--reminded me of the American travelogues to Cuba written int he 1930s. That comforts Americans but the reactions among Cubans might be somewhat different. 

Plus, extra credit goes to a country that so lovingly preserves old American cars. I rode in from the airport in a pink 1954 Cadillac.
I just don't know what to do with this.  But the picture helps. Cuba is not the Petit Trianon with its stylized pastoral atmosphere in which one can play act Arcadia, and this is not 1786, the appreciation of old cars changes perspective quickly depending on which side of the US-Cuba equation one sits. Again the eclogue trope rears its discursive head.
In another sign of flexibility, Cuba recently hammered out a deal with Major League Baseball that will allow Cuban players to travel legally to the U.S. and play on American teams.

Yet, sadly, the Trump administration is threatening the deal.
Yes, very nice.  This has been part of Cuban policy for a while.  And it is also a defensive move--the Cuban state has been frustrated about American poaching of its star p`layers, and they were looking for ways to reduce the flow.  This may or may not work. But it suggests little more than this. And we are not sure why the Trump administration seeks renegotiation, though this is hardly surprising given the MO of this Presidency.

Consider the persistence of North Korea and Cuba, and there’s an argument that sanctions and isolation preserve regimes rather than topple them. China teaches us not to be naïve about economic engagement toppling dictators, but on balance tourists and investors would be more of a force for change than a seventh decade of embargo.
Aaahhh the cocktail of communism argument.  China is not Cuba, and Cuba is not Korea. Each state requires an approach contextually appropriate.   None of this has anything to do with the value of the Embargo.  And, of course, one notices by omission Iran.  At the end of the paragraph all we have, again, is the simple equation: Embargo  was set up to aid in the overthrow of the Cuban Communist government; that has not happened, therefore the Americans should try something else.  But if that is the case, then is Mr. Kristof still advocating the overthrow of the Cuban Communist Regime? And is that is the case then might the Cubans be as suspicious of dismantling the Embargo as much as they despise the Embargo?   

Moreover, trade, tourism, travel and investment empower a business community and an independent middle class. These are tools to destabilize a police state and help ordinary Cubans, but we curtail them. America blames the Castros for impoverishing the Cuban people, but we’ve participated in that impoverishment as well.
Here one sees the brilliance of the Cuban position. Mr. Kristof adopts the Cuban position, especially its moral overtones without context. Here Mr. Kristof's verities are undermined, or at least substantially recast with a reading of the Communist Party's 2016 Reconceptualization of its Economic and political moidel along with its 20'30 economic plan.  Both suggest a rejection of the notion of class stratification, both suggest the primary importance of retaining those key sectors in the hands of the state, and both also reaffirm the need to contain foreign economic activity to avoid any substantial direct penetration of outside economic actors without close supervision by the state.  In that context Mr. Kristof's assumptions assume the character of a dream in which Cuba is absent. But then this argument is never about Cuba, where Cuba is reduced to a spiritual landscape with little relation to the Island sitting 90 miles from the US. 

Cuba’s government is not benign. It’s a dictatorship whose economic mismanagement has hurt its people, and Human Rights Watch says it “routinely relies on arbitrary detention to harass and intimidate critics.” But it doesn’t normally execute them (or dismember them in consulates abroad like our pal Saudi Arabia), and it tolerates some criticism from brave bloggers like Yoani Sánchez.
Here Mr. Kristof indulges in the game of the relativism of evil. Cuba is bad, but we are vexed with our Saudi friends who were clumsy enough to allow their Turkish enemies to record a murder (but do little to prevent it).  Surely, one is managed into thinking, the Cubans provide a better alternative. This, of course, is a political decision.  But if it suggests that sanctions against Saudi Arabia are good then the argument about sanctions fails, since Mr. Kristof has spent now many words to convince us that Embargoes are a bad idea.  Yet that cannot be entirely true--there is substantial support for the new approach to sanctions---the Global Magnitsky Act sanctions regimes.  And perhaps that is what might provide a better alternative to the ham handed Embargo.  But we never get there here. in this  that has seemed to

It is revising its constitution, and my hope is that over time — despite ideologues in both Havana and the United States — relations will continue to develop. Some American seniors who now winter in Florida could become snowbirds in Cuba instead, relying on its health care, low prices, great beaches and cheap labor. You can hire a home health care aide for a month in Havana for the cost of one for a day in Florida.
Arcadia

China’s economic boom began in the early 1980s partly with factories financed by Chinese overseas, and after the American embargo ends, Cuba will have similar opportunities to forge mutually beneficial business partnerships with Cubans overseas.
False analogies are always useful, lyrical and wistful reminders that the dream is always as close as one can get to perfection. 

That would benefit both sides. For 60 years, we’ve been feuding, like the Hatfields and the McCoys, in a conflict whose origins most Americans don’t even remember clearly.
If Mr. Kristof means what he had said earlier, then getting rid of the Embargo would substitute an open relationship in which the Americans would continue to push Cuba.  That is precisely what is likely to create incentives to keep our relations adversarial. Oh, and both the Cubans and the Americans remember quite clearly the origins of the acrimony.  That is not the issue.  The issue is interest and ideology.  And the question, which Mr. Kristof fails to ask, is the value of the Embargo to Cuba. For indeed, it does have a political value.  That value may not equal foregone economic progress--but Cuba measures economic welfare with a set of metrics quite different from those we use. Again reading the Conceptualiztion of the Political and Economic model provides useful guide.  But who likes reading primary sources?  If the Embargo goes then the Cubans will have to figure out a way to retain its political value in sme other way. For the Americans that produces a net zero value for change.  And that is a problem.

So come on. We should all be bored by a lifetime of mutual recriminations and antagonisms. Let’s put aside the ideology, end the embargo, tone down the propaganda and raise a mojito together.
Asking the Cubans and the Americans to put aside ideology is just ludicrous. Neither set of governing elites could possibly do that without precipitating serious political crisis--at least in the absence of other changes. But the failure of this last paragraph exposes the deepest weakness of the entire Arcadian exercise. Mr. Kristof fails to ask: if the Embargo ends tomorrow, would trade open up in the way he envisions? The answer has already been provided by thje Cubans and their approach to foreign direct investment with countries already quite willing to invest--and that answer is NO. The Embargo is only one half of the issue; the other half centers on the reception of investment and trade into Cuba. And in that respect the Cuba state has made it very clear that it will retain its virtually impermeable wall to unsupervised investment. It will likely keep foreign enterprises (except those of friendly states) within free trade zone ghettos, and the state will serve as the buffer between foreign investment and trade and the Cuban people. The Cuban state does this to protect its system and its internal control. Many inside and outside Cuba are unhappy with the result. But thatis a problem that removing the Embargo will not fix. 
I propose a toast to a new beginning.
And I propose that new beginnings start form mutual respect and from the humility to know that the issue of normalization will require both states equally involved. This is not an American matter but one dependent on the conduct and decisions of both states.

Kristof is a New York Times columnist.

Papa Johns, Corporate Risk Management, and the Social Responsibility of Enterprises in the Shadow of Corporate Law--"Schnatter v. Papa John’s" and Director Authority to Inspect Corporate Books and Records

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U.S. enterprises have been particularly sensitive to the social consequences of executive and board of director conduct, even when such conduct may not necessarily violate the law. I have suggested the way that this risk management and compliance approach has had substantial effect in the management of a global enterprise's production chain (Human Rights Without Chinese Characteristics and Global Production Chains Within China: Xinjiang and Badger Sportswear as a Harbinger of Dissonance in Human Rights Risk Management). 

But this approach has also significant domestic effects, especially in the context of enterprise disciplining of board members and officers in response to allegations of charges relating to sexual misconduct or insensitivity, especially directed toward traditionally marginalized groups. A recent Delaware corporate law case suggests the way that corporate action grounded in social responsibility, risk management and compliance interacts with traditional management of legal risk--for all parties. 

The context was the widely covered scandal involving John Schnatter, the founder of Papa John's and the face of the company on its extensive advertising, was forced to resign after using a racially explosive term during the course of a meeting (John Schnatter, Papa John’s Chairman, Resigns After Using Racial Slur). The company's sales were significantly affected as other enterprises with whom Papa John's had a relationship sought to distance themselves from the company and association with the scandal (e.g., Marlins, Rays suspend relationship with Papa John's after racial slur). Eventually the board of directors sought to sever all ties with Mr. Schnatter, and he sued. (Papa John's Founder Sues Company for Documents Over Ouster; The original Papa John is suing Papa John's and people are freaking out)  The context was well summarized  by Chancellor Bouchard: 
In November 2017, John Schnatter, the founder of Papa John's International, Inc., criticized the National Football League's handling of the dispute between NFL players and owners over national anthem protests during a call held to report the company's earnings. Some in the media portrayed Schnatter's comments about the NFL as racial in nature. In July 2018, Forbes reported that Schnatter used a racial slur during an internal diversity training exercise at the company in May 2018.

On the same day the Forbes article was published, the company's board asked Schnatter to resign as its Chairman, which he did. Over the next few days, the board also asked Schnatter to resign as a director of the company, which he declined to do. The board then established a special committee to investigate all of the company's relationships with Schnatter. Within three hours of its formation, the special committee decided to terminate two agreements the company had with Schnatter.

In the wake of these events, Schnatter made a demand under 8 Del. C. § 220 in his capacity as a director of the company to inspect seventeen categories of documents. Perplexed about why the company made no effort to defend him as the founder and longstanding public face of the company from what he believes was unfair treatment by the media, and why the company instead seemed intent on abruptly cutting ties with him without investigating the matter, Schnatter questions whether his fellow directors fulfilled their fiduciary obligations. (Schnatter v. Papa John’s (C.A. No. 2018-0542-AGB) Court of Chancery of Delaware (Jan. 15, 2019) )
While the legal issues are technical, for compliance and risk management focused enterprises the exposure can be significant. The Chancery Court read a broadly a director's authority to inspect books and records--including those produced or stored on the personal devices of board members, and even if the request was motivated in part by personal motives.



JOHN SCHNATTER, Plaintiff,v.PAPA JOHN'S INTERNATIONAL, INC., Defendant.

C.A. No. 2018-0542-AGB.Court of Chancery of Delaware.
Submitted: November 30, 2018.
Decided: January 15, 2019.
Peter B. Ladig, Brett M. McCartney, and Elizabeth A. Powers, BAYARD, P.A., Wilmington, Delaware; Garland A. Kelley, GLASER WEIL LLP, Los Angeles, California, Attorneys for Plaintiff.
Blake Rohrbacher, Robert L. Burns, Brian F. Morris, and Kevin M. Regan, RICHARDS, LAYTON & FINGER, P.A., Wilmington, Delaware, Attorneys for Defendant.

MEMORANDUM OPINION

BOUCHARD, C.
In November 2017, John Schnatter, the founder of Papa John's International, Inc., criticized the National Football League's handling of the dispute between NFL players and owners over national anthem protests during a call held to report the company's earnings. Some in the media portrayed Schnatter's comments about the NFL as racial in nature. In July 2018, Forbes reported that Schnatter used a racial slur during an internal diversity training exercise at the company in May 2018.
On the same day the Forbes article was published, the company's board asked Schnatter to resign as its Chairman, which he did. Over the next few days, the board also asked Schnatter to resign as a director of the company, which he declined to do. The board then established a special committee to investigate all of the company's relationships with Schnatter. Within three hours of its formation, the special committee decided to terminate two agreements the company had with Schnatter.
In the wake of these events, Schnatter made a demand under 8 Del. C.§ 220 in his capacity as a director of the company to inspect seventeen categories of documents. Perplexed about why the company made no effort to defend him as the founder and longstanding public face of the company from what he believes was unfair treatment by the media, and why the company instead seemed intent on abruptly cutting ties with him without investigating the matter, Schnatter questions whether his fellow directors fulfilled their fiduciary obligations.
The parties have resolved their disputes concerning thirteen of the seventeen categories of documents sought in Schnatter's demand. In this post-trial decision, the court concludes that the company failed to prove that Schnatter's purpose for seeking to inspect the remaining four categories of documents is improper and that he therefore is entitled to inspect these documents subject to certain limitations.

I. BACKGROUND

The facts recited in this opinion are the court's findings based on the testimony and documentary evidence presented at a one-day trial held on October 1, 2018. The record includes stipulations of fact made in the Pre-trial Stipulation and Order ("PTO"), over 100 trial exhibits, and testimony from one fact witness: John Schnatter. Although the company bore the burden of proof to show that Schnatter's purpose was improper, it did not call any other witnesses to testify at trial.

A. The Parties

Schnatter is the founder of Papa John's International, Inc. ("Papa John's" or the "Company").[1] Since around 1993, Schnatter has served as a member of the Company's board of directors (the "Board").[2] Until recently, Schnatter served as the Company's Chairman of the Board, Chief Executive Officer, and spokesman.[3] He is the Company's largest stockholder, owning approximately 30% of the outstanding shares.
Papa John's is a Delaware corporation and currently the third-largest pizza delivery and take-out company in the world.[4] Its Board currently consists of six members, including Schnatter. The other five directors are Mark S. Shapiro, Sonya Medina, Olivia Kirtley, Christopher Coleman, and Laurette Koellner.[5] Since January 1, 2018, Steve Ritchie has served as the Company's President and CEO.[6]

B. Schnatter Comments on the NFL and Resigns as CEO

On October 31, 2017, the Company announced that it had hired Laundry Service, a marketing agency, as its new creative agency of record to handle the creative aspects of the Company's marketing and some of its purchases of advertising time.[7] Ritchie, the Company's Chief Operating Officer at the time, was responsible for hiring Laundry Service.[8]
On November 1, 2017, Schnatter participated in a call to report on the Company's earnings (the "Earnings Call"). At the time, the Company was the official pizza sponsor of the National Football League.[9] On the Earnings Call, Schnatter made the following comments:
Now to the NFL. The NFL has hurt us. And more importantly, by not resolving the current debacle to the player and owners' satisfaction, NFL leadership has hurt Papa John's shareholders. Let me explain. The NFL has been a long and valued partner over the years, but we are certainly disappointed that [the] NFL and its leadership did not resolve the ongoing situation to the satisfaction of all parties long ago. This should have been nipped in the bud 1.5 years ago. Like many sponsors, we are in contact with [the] NFL. And once the issues [are] resolved between the players and the owners, we are optimistic that [the] NFL's best years are ahead, but good or bad, leadership starts at the top. And this is an example of poor leadership.[10]
These comments were part of a script for the call that was reviewed by Lance Tucker, the Company's then-Chief Financial Officer, and Steve Ritchie.[11] Ritchie asked Schnatter not to make comments regarding the NFL during the call but, according to Schnatter, Ritchie lacked the authority to prevent him from doing so.[12] Later in the call, Ritchie told an analyst that "the NFL situation" was applying "pressure" to the Company's sales.[13] He also told another analyst that Schnatter's contention about the NFL "controversy" hurting the Company's business was a "great point."[14]
Schnatter's comments during the Earnings Call were the subject of significant public criticism. Forbes reported that Papa John's "received significant flak after Schnatter declared on an earnings call that national anthem protests in the National Football League were partially to blame for slow sales at the company."[15] Yahoo! Finance wrote that Schnatter's comments on the Earnings Call were seen as "a desperate effort to find someone else to blame" and "sparked a backlash."[16]
Schnatter testified that the media took his comments "so far out of context so quickly" that the reaction appeared "premeditated."[17] Schnatter spoke to Company personnel, including Ritchie, about clarifying what he had said during the Earnings Call. According to Schnatter, Ritchie advised him to "lay low" and not "do anything," and the Company made minimal effort to change the public's perception of what he had said, instead blaming its declining sales on Schnatter's comments for the next two months.[18]
On December 31, 2017, Schnatter resigned as CEO of the Company.[19] On February 27, 2018, the NFL terminated its sponsorship with Papa John's. The next day, the NFL announced that Pizza Hut would be its new pizza sponsor. Papa John's stock price declined significantly when this news was announced.[20]

C. Schnatter Resigns as Chairman After the Training Exercise

On May 14, 2018, Schnatter attended a meeting with Laundry Service in New York to discuss the creative plan it was proposing for the Company.[21] One of the proposals Laundry Service "was adamant" about was to put Kanye West in ads for Papa John's with Schnatter.[22] A few days later, Schnatter told Laundry Service he was not comfortable with this proposal after he did some research and learned that Kanye West used the N-word in his lyrics.[23]
On May 22, 2018, Schnatter, Ritchie, and two others participated from the Company's corporate offices in a telephonic media training exercise about diversity that was held with executives from Laundry Service (the "Training Exercise").[24] Schnatter was not informed before the call that he would be asked questions about race.[25] The Training Exercise began with a handout of questions that were not provided to Schnatter in advance, the first of which was: "Are you a racist?"[26] After about forty minutes of questioning, including questions Schnatter viewed as insinuating that his comments about the NFL were racial in nature, Schnatter used the N-word during the Training Exercise. As he recounted at trial: "Well, I said, `Colonel Sanders uses the N-word. I don't use the N-word, and we're not going to use the N-word.'"[27] The next day, Papa John's and Laundry Service mutually agreed to terminate their relationship.[28]
On July 11, 2018, Forbes published an article about the Training Exercise, entitled "Papa John's Founder Used N-Word on Conference Call" (the "Forbes Article").[29] The Forbes Article reported that Schnatter was engaged in a role-playing exercise in which he "was asked how he would distance himself from racist groups online" following his comments about the NFL.[30] According to the Forbes Article, Schnatter tried to downplay the significance of his NFL comments by saying (using the entire racial slur) that "Colonel Sanders called blacks n-----s" yet "never faced public backlash."[31] The Forbes Article also reported that Schnatter wrote in an emailed statement on the afternoon of July 11 that "reports attributing the use of inappropriate and hurtful language to me during a media training session regarding race are true. Regardless of the context, I apologize. Simply stated, racism has no place in our society."[32]
Later on July 11, after the Forbes Article came out, Schnatter resigned as Chairman of the Board at the request of the Board.[33] Within a few days after the Forbes Article was published, some professional sports teams and organizations cut ties with Papa John's.[34]
On July 13, 2018, during a radio interview, Schnatter reportedly asserted that "he was pressured to use the N-word during the" Training Exercise: "The agency was promoting that vocabulary. . . . They pushed me. And it upset me."[35] The next day, on July 14, Schnatter sent a letter to the Board disputing the Company's portrayal of his comments from the Training Exercise.[36] According to Schnatter, the Company did nothing "to set forth the truth so that the press could correctly report what occurred[.]"[37]
On July 15, 2018, Kirtley, the Company's lead director, requested that Schnatter also resign as a director but he declined to do so.[38] Kirtley told Schnatter that he was not "designated or authorized to speak or make appearances on behalf of the Company."[39]
At around this time, Schnatter sent a letter to the other Board members in which he asserted that the Forbes Article "mischaracterized" what happened during the Training Exercise, that his use of the N-word was "in no way racist," and that the Company "completely mishandled the NFL situation."[40] He further asserted that Laundry Service had engaged in an "extortion attempt" to extract $1.2 million from the Company when its contract was terminated, that it was a "mistake" for him to resign as Chairman, and that "corporate governance experts" believed the Board had acted improperly in asking him to step down as Chairman and as a director "without any investigation."[41]

D. The Board Forms a Special Committee

On July 15, 2018, before a Board meeting scheduled for later that day, Schnatter learned that the Board might form a special committee when he received an updated agenda for the meeting.[42] Schnatter's counsel (Glaser Weil LLP) wrote to the Board before the meeting, asserting that the Board "has no authority to remove Mr. Schnatter as a director" under Delaware law, that the Board had failed to act in the best interests of the Company by allowing Schnatter's comments to be misconstrued, and that its failure to conduct a full investigation could result in the Board breaching its fiduciary duties.[43]
The Board meeting on July 15 (the "July 15 Meeting") began at around 8:15 p.m.[44] About fifteen minutes later, the Board approved a set of resolutions establishing a special committee (the "Special Committee") consisting of all the directors other than Schnatter, i.e., Shapiro, Medina, Kirtley, Coleman, and Koellner.[45] The Special Committee was given "exclusive power and authority" to review, and make determinations about, all of the relationships between Schnatter and the Company.[46] Akin Gump Strauss Hauer & Feld LLP was retained as the Special Committee's counsel.[47] The Company contacted Akin Gump two days earlier, on July 13, to discuss its representation of the not-yet-formed Special Committee, and formally authorized the representation on July 15, 2018.[48] It is unclear what, if anything, Akin Gump did during that two-day window in connection with its representation.
The Special Committee met later on the evening of July 15.[49] At approximately 11:23 p.m., a lawyer with a law firm representing the Company (Hogan Lovells US LLP) emailed Schnatter notices of the Company's intent to terminate two agreements it had with Schnatter: (1) an Agreement for Service as Founder (the "Founder's Agreement") and (2) a Sublease Agreement governing Schnatter's use of some office space at the Company's headquarters (the "Sublease Agreement").[50]
After the July 15 meetings, counsel for Schnatter and Papa John's exchanged letters. On July 16, 2018, Akin Gump wrote to Glaser Weil, explaining that "neither the Board nor the Special Committee has taken any action to remove Mr. Schnatter as a member of the Board" and that "all actions taken by the Special Committee in this matter . . . have been in the best interests of the Company and its shareholders."[51] The letter also stated that "the Special Committee will oversee an external audit and investigation of the Company's existing processes, policies and systems related to diversity and inclusion, supplier and vendor engagement and the Company's culture."[52] Glaser Weil replied on July 18, 2018, arguing that the Company's purported termination of the Founder's and Sublease Agreements violated the terms of those agreements and stating that "we fully expect that as part of the review conducted by the Special Committee, it will interview Mr. Schnatter."[53]

E. Schnatter Makes a Section 220 Demand and Files Suit

On July 18, 2018, Schnatter delivered to the Company and its registered agent a demand under 8 Del. C.§ 220(d) (the "Demand") to inspect the following seventeen categories of the Company's books and records:
1. Communications with and between Counsel to the Company and any officer or director of the Company from October 31, 2017 through the formation of the Special Committee at the July 15, 2018 meeting of the Board of Directors (the "July 15 Meeting") referring or relating to me. For purposes of this Demand, Counsel shall mean any outside counsel to the Company, including without limitation, Hogan Lovells US LLP, Gibson Dunn & Crutcher, LLP, in-house counsel to the Company, and any counsel representing any director in connection with such director's service on the Board of Directors (the "Board").
2. Communications between or among directors, and/or any director and Counsel from October 31, 2017 through the July 15 Meeting relating to the article on Forbes.com's website published on or about 5:00 a.m. on July 11, 2018 referring to me (the "Forbes Article").
3. Communications between or among directors, and/or any director and Counsel from October 31, 2017 through the July 15 Meeting referring or relating to me.
4. Communications between or among directors and Counsel from October 31, 2017 through the July 15 Meeting referring or relating to Schnatter Group Arrangements as that term is defined in the resolutions adopted at the July 15 Meeting appointing the Special Committee (the "July 15 Resolutions").
5. Documents reflecting notice to me that the Independent Directors had retained separate legal representation in connection with their service on the Board. For purposes of this Demand, the term Independent Directors means Olivia F. Kirtley, Christopher L. Coleman, Laurette T. Koellner, Sonya E. Medina, and Mark S. Shapiro.
6. Communications between or among directors or officers, Counsel and/or Akin Gump LLP prior to the July 15 Meeting, including without limitations all drafts of the July 15 Resolutions and the Special Committee Charter.
7. Any engagement letter between the Independent Directors and Akin Gump LLP prior to formation of the Special Committee.
8. The engagement letter between the Special Committee and Akin Gump.
9. The minutes of all meetings of the Board and any committees thereof from October 31, 2017 through and including the July 15 Meeting.
10. All materials provided to the Independent Directors in connection with the July 15 Meeting.
11. The minutes of any meeting of the Special Committee.
12. All materials provided to the Special Committee in connection with the meeting of the Special Committee held on or about July 15, 2018.
13. Communications between or among directors and Counsel referring to [sic] relating to my membership on the Board from October 31, 2017 to the present.
14. All documents referring or relating to any allegations of sexual harassment or other sexual misconduct and innuendo by any member of the Board or any Section 16 officers including without limitation all communications received or sent by the Company or any officer or director of the Company referring or relating to such allegations.
15. All documents referring or relating to the Company's relationship with Laundry Service, including without limitation all communications between the Company, Laundry Service, Casey Wasserman, and/or any companies (including their employees) affiliated with Casey Wasserman and any engagement letter between the Company and Laundry Service.
16. Any contracts, agreements or understandings between me and any of my affiliates and the Company.
17. Any settlement agreements or non-disclosure agreements involving me or my affiliates in the possession, custody or control of the Company.[54]
Regarding his purpose for making the Demand, Schnatter wrote: "The purpose of my demand is to inform myself so that I may fulfill my fiduciary duties and ensure that the other members of the Board are fulfilling their fiduciary duties as well."[55] On July 25, 2018, the Company sent a response that largely rejected the Demand.[56]

F. The Conflict Between Schnatter and the Company Continues

On July 27, 2018, counsel for the Papa John's Franchisee Association wrote to the Board to officially complain about Schnatter's use of the N-word. The letter asserted that this was "not the first time Mr. Schnatter has engaged in offensive and damaging behavior," noting the NFL-related comments and comments pertaining to the Affordable Care Act.[57]
In August 2018, Schnatter created a website—savepapajohns.com—where he posts information, including filings in this action, about what he views as the Company's unfair efforts to marginalize him.[58]
On August 5, 2018, the New York Post published an article describing the relationship between Schnatter and Ritchie.[59] The article describes how Schnatter was complimentary of Ritchie when Ritchie was named as CEO on January 1, 2018, but that his confidence in Ritchie changed six months later, after two disappointing quarters.[60] The article goes on to suggest that Ritchie organized a coup to oust Schnatter from the Company after he learned that Schnatter had prepared a negative performance review of him and that Schnatter was planning to recommend to the Board that he be removed from the CEO position.[61] According to the article, one of the reasons Schnatter filed his Section 220 action was to "prove Ritchie got hold of his evaluation."[62] Schnatter testified that "Steve knew that [the] evaluation was going to be subpar and that [he] was going to terminate him."[63]
On August 7, 2018, the Company issued its second-quarter earnings report, "which revealed a 25% decline in earnings per share over last year's numbers and falling sales both domestically and abroad."[64] That same day, Schnatter released a public statement saying he was concerned about the Company's sales and the "direction the Company [is] headed under the stewardship of Steve Ritchie and the current board of directors."[65]
On August 17, 2018, Schnatter wrote a letter to the Company's Senior Vice President for Global Human Resources with the subject line "Inappropriate Conduct By Members of the Company's Leadership Team."[66] In the letter, Schnatter asserts that a "`fraternity'-like environment" exists at the Company and that Ritchie is primarily responsible for creating it.[67] The letter includes five exhibits, which are mainly notes and letters created by Company employees that describe a range of inappropriate conduct by Ritchie, Mark Shapiro (a director), and others.[68]
On August 28, 2018, Schnatter gave an interview with CNN's business division. In discussing Papa John's recent poor financial performance, Schnatter stated that "[y]ou can't blame everything on two comments. I wish I had that kind of power, but I don't."[69] Schnatter further commented that the Company needed "new leadership" because Ritchie was "struggl[ing] as a CEO."[70] At trial, Schnatter presented a graph that purports to correlate the Company's declining financial performance with Ritchie's tenure as CEO.[71]
On August 29, 2018, the Special Committee issued a press release stating that Schnatter "has demonstrated a continued pattern of ignoring decisions of the Board, both in his role as CEO and as non-executive Chairman of the Board."[72] The Special Committee provided several examples, including that the "Board specifically directed John Schnatter not to talk about the NFL controversy related to the National Anthem" but he did so anyway, and that Schnatter "misinformed the Board about the circumstances surrounding the termination of the Company's relationship with Laundry Service."[73]
On September 12, 2018, Schnatter publicly accused the Company of "hiding documents that, we believe, will disclose the actual facts as to what is occurring here, including use of Mr. Schnatter as a scapegoat to cover up their own shortcomings and failures."[74] Schnatter also testified that a fellow director, Mark Shapiro, has benefitted from the Company's efforts to cut ties with him because a company Shapiro owns is now doing advertising business with Papa John's, which Schnatter would not have permitted.[75]

G. Schnatter Files a Derivative Complaint

On August 30, 2018, Schnatter filed a second action in this court against Ritchie and the five members of the Board who serve on the Special Committee, asserting five claims for breach of fiduciary duty, four derivatively (Counts I-IV) and a fifth directly (Count V) (the "Fiduciary Action"). Count I asserted that Ritchie breached his fiduciary duty of loyalty as an officer of the Company by launching "a false and defamatory campaign against Mr. Schnatter, falsely accusing him of racism, after Mr. Ritchie learned that he was going to lose his job."[76] Counts II-IV asserted that the members of the Special Committee breached their fiduciary duties of care or loyalty in various ways.[77] Count V asserted that the Special Committee defendants breached their fiduciary duties by adopting a shareholder rights plan in July 2018.[78]
On September 21, 2018, Schnatter amended his complaint in the Fiduciary Action to drop the claim against Ritchie. Schnatter later stated his intention to amend his complaint a second time to withdraw the three claims asserted against the Special Committee defendants (Counts II-IV), but he has not yet sought to do so.[79]

II. PROCEDURAL HISTORY

On July 26, 2018, after the Company had largely rejected his Demand, Schnatter filed this action. The Complaint contains a single claim seeking an order requiring the Company to permit inspection of the books and records sought in the Demand. On September 4, 2018, the Company moved to dismiss the Complaint for failure to state a claim for relief, which the court denied on September 20.
Following a one-day trial held on October 1, 2018, the court heard post-trial argument on November 16, 2018. Based on various positions the parties advanced during the argument suggesting that their disputes had been narrowed, the court asked the parties to meet and confer to explore a resolution. On November 30, 2018, the parties informed the court that they had resolved the open issues concerning thirteen of the seventeen categories of documents requested in the Demand and that the only issues that remain unresolved pertain to Requests Nos. 1-4.[80] The court has only a partial understanding of how the parties resolved the issues concerning the thirteen categories of documents no longer in dispute.

III. ANALYSIS

The Delaware General Corporation Law provides that a "director shall have the right to examine the corporation's . . . books and records for a purpose reasonably related to the director's position as a director."[81]"A director who has a proper purpose . . . has virtually unfettered rights to inspect books and records," which afford "access at least equal to that of the remainder of the board."[82]"The public policy underlying that rule is plain: a director charged with fiduciary obligations to protect and preserve a corporation must have access to the corporation's books and records if he reasonably can be expected to perform his duties."[83]
A "director seeking inspection of books and records makes out a prima facie case when he shows that he is a director, he has demanded inspection and his demand has been refused."[84] At that point, the "defendant corporation bears the burden of proving that any such inspection is for an improper purpose."[85] The burden of proof under Section 220 is a "preponderance of the evidence."[86]"[P]roof by a preponderance of the evidence means that something is more likely than not."[87]
A director's purpose is not automatically rendered improper "because of the possibility that he may abuse his position as a director and make information available to persons hostile to the Corporation or otherwise not entitled to it. If [a director] does violate his fiduciary duty in this regard, then the Corporation has its remedy in the courts."[88] If it is established, however, that a director's "motives are improper, or that they are in derogation to the interest of the corporation, then his right to inspect ceases to exist."[89]
The following analysis proceeds in three parts. The court begins by determining the propriety of Schnatter's purpose for seeking inspection of documents. After concluding that the Company has failed to prove by a preponderance of the evidence that his purpose is improper, the court considers the appropriate scope for Schnatter's inspection of documents. Finally, the court addresses the Company's arguments to impose conditions on the production of documents to Schnatter.

A. The Propriety of Schnatter's Purpose for the Demand

The record plainly shows that Schnatter is a director of the Company, that he made the Demand to inspect books and records of the Company under Section 220(d), and that the Company largely rejected his Demand.[90] As such, because the Company challenges the propriety of Schnatter's purpose for making the Demand, the Company bears the burden of proving by a preponderance of the evidence that Schnatter's purpose is not "reasonably related to [his] position as a director."[91]

1. Schnatter's Stated Purpose for Making the Demand

The stated purpose for which Schnatter made his Demand has been the subject of some confusion. In his Demand, Schnatter stated: "The purpose of my demand is to inform myself so that I may fulfill my fiduciary duties and ensure that the other members of the Board are fulfilling their fiduciary duties as well."[92] The use of the introductory phrase "[t]he purpose" suggests that Schnatter has a single purpose. One reasonably could read the balance of the sentence, however, to describe two potentially distinct purposes: first, to ensure that Schnatter is fulfilling his own fiduciary duties, and second, to ensure that the other directors have fulfilled their fiduciary duties.
In response to an interrogatory, Schnatter stated that "his only purpose is set forth in the Demand: to investigate whether members of the Board have breached their fiduciary duties to the Company and its stockholders."[93] Shortly before trial, Schnatter purported to amend this interrogatory response to state that, "consistent with his Demand and his deposition testimony, his purposes are to inform himself so that he may fulfill his fiduciary duties and ensure that the other members of the Board are fulfilling their fiduciary duties as well."[94]
At trial, Schnatter stood by his original interrogatory response when asked about the purpose of his Demand.[95] Schnatter then elaborated on redirect that "to investigate" in this context means to "gain knowledge, to inform yourself, to have insight. I mean, investigate means to get to the bottom of something and know what's going on."[96] By post-trial argument, Schnatter's counsel took the position that the two purposes apparent in the Demand "are one and the same, and they both seek to investigate potential mismanagement."[97]
In sum, although Schnatter's explanations of his purpose have varied, I find that the stated purpose for his Demand boils down to a single purpose: to investigate mismanagement of the Company by the other members of the Board. Both parties now agree on this.[98]"It is well established that investigation of mismanagement is a proper purpose for a Section 220 books and records inspection."[99]

2. The Company Has Failed to Prove that Schnatter's Purpose Is Not Reasonably Related to His Position as a Director

The Company argues that "Schnatter is not seeking documents for a purpose reasonably related to his position as a director" on the theory that he actually "is seeking documents that relate to his individual status as John Schnatter—founder and stockholder and former Chairman and CEO of the Company."[100] In other words, according to the Company, Schnatter's stated purpose for the Demand is a pretext and his actual purpose is personal and thus improper.
The Company gives four reasons in support of this contention: (1) Schnatter's Demand seeks "mostly documents about himself;"[101] (2) his Complaint concedes that he "sought to inspect documents because of the unexplained and heavy-handed way in which the Company has treated him since the publication of" the Forbes Article;[102] (3) he conceded at trial that he wants to "get hold of documents he feels will clear him and his reputation;"[103] and (4) he "appears to be seeking documents to further his current fiduciary suit or to pursue another fiduciary suit."[104] The court will address the first three reasons together and then turn to the fourth reason.

a. The Company Has Failed to Prove that Schnatter's Purpose Is Improper Because It Is Personal

The first three reasons fundamentally say the same thing: Schnatter's actual purpose for making the Demand is personal and therefore improper under Section 220. Although Schnatter's interests as a director and as an individual often overlap because of the unique public role he has played at the Company for many years, the Company has failed in my opinion to meet its burden of showing that Schnatter's actual purpose for making the Demand is personal and thus not reasonably related to his position as a director.
Schnatter is the founder and largest stockholder of the Company. Over the course of his thirty-four-year career with the Company, he held virtually every position—from cook and dishwasher to CEO—and, critically, he became the public face of the Company in its marketing efforts on television and in print.[105] Given his unique role as the Company's longstanding public spokesman, Schnatter's concerns that the Company made no effort to defend him in response to the controversies arising from his comments about the NFL and the publication of the Forbes Article, and that the Company instead appeared intent on abruptly severing ties with him, are relevant concerns that any director, including Schnatter, would have about the Company's management and oversight.
Additionally, having listened carefully to Schnatter's testimony about how these events unfolded and having observed his demeanor at trial,[106] I find that Schnatter's Demand arose from a genuine desire to investigate whether the other members of the Board had fulfilled their fiduciary obligations in handling the controversies during the period leading up to the July 15 Meeting.[107] Schnatter testified, for example, that he was taken aback by the swiftness of the media to portray his comments about the NFL as racial in nature, and that he felt ambushed and pressured during the Training Exercise, which led to the Forbes Article. Whether or not Schnatter's perceptions of those events are accurate, he testified credibly that he had those perceptions, which lends credence to his concern that it was inappropriate for the Board to ask him to resign as Chairman and as a director within a few days of the publication of the Forbes Article and before the Board had conducted an investigation or interviewed him.
To be sure, there is a personal element to the concerns Schnatter testified about because they also pertain to his reputation as an individual. But that fact does not negate that these concerns are legitimate corporate concerns, particularly given that Schnatter's image and standing has been inextricably intertwined with the Company's public persona for decades. In short, I find that the Company has failed to prove that Schnatter's purpose for the Demand is not reasonably related to his position as a director. I reject the Company's theory that his actual purpose is to obtain documents to advance his personal interests, although I recognize that the documents sought in the Demand may be important to him personally as well.

b. The Company Has Failed to Prove that Schnatter's Purpose Is Improper Based on His Filing of the Fiduciary Action

The fourth reason the Company cites to prove that Schnatter's purpose is improper is that he "appears to be seeking documents to further his current fiduciary suit or to pursue another fiduciary suit."[108] Delaware courts have recognized that a stockholder who files a plenary action asserting claims of mismanagement undercuts his alleged need to obtain documents under Section 220 to investigate the same alleged acts of mismanagement.[109]
The rationale for this rule was most recently explained in Bizzari v. Suburban Waste Services, Inc.[110] In that case, Louis Bizzari, the founder of Suburban Waste Services, Inc. and its parent company, Felt Properties, LLC, made a demand to inspect documents of both entities in two different capacities: (1) as a stockholder of Suburban and as a member of Felt, and (2) as a director and a manager of those companies, respectively. Recognizing that the standards governing his demands varied depending on Bizzari's capacity, the court was careful to analyze Bizzari's "demand as a stockholder/member separately from his demand as a director/manager."[111]
In analyzing Bizzari's demand as a stockholder and member, the court noted that, after trial in his inspection action, Bizzari had filed a plenary action concerning efforts to remove him as a director and manager and to sell certain assets of Suburban without his consent. The court concluded that Bizzari had "failed to meet his burden of establishing a credible basis to investigate possible mismanagement or wrongdoing."[112] With respect to the subject matter of the plenary action, the court reasoned that, by filing the plenary action, "Bizzari and his counsel presumably concluded they possessed sufficient information under Rule 11 to file the complaint without first inspecting books and records."[113] Thus, as the court further explained, Bizzari "effectively conceded that the books and records he seeks are not necessary or essential to his stated purpose of investigating mismanagement or wrongdoing with respect to the removal or asset sale issues."[114]
In analyzing Bizzari's demand as a director and manager, the court made no mention of Bizzari's filing of his plenary action or the impact that filing could have on obtaining documents in his capacity as a director and manager. The court instead focused on evidence showing that "Bizzari's conduct during the last year had been entirely inconsistent with [Suburban's] interests."[115] In particular, the court found that Bizzari "demonstrated a willingness to compete directly with Suburban" and "remains motivated to do so as a result of his extreme anger and resentment of [Suburban's] other two principals."[116] Relying on this evidence, the court concluded that Suburban had carried its "rather substantial burden of proving that [Bizzari's] demand to inspect books and records in his capacity as a director and manager is not motivated by a proper purpose."[117]
Here, in challenging the propriety of Schnatter's purpose based on his filing of the Fiduciary Action, the Company focuses on one aspect of one claim in the Fiduciary Action where Schnatter alleges that the members of the Special Committee breached their fiduciary duty of care by terminating the Founder's and Sublease Agreements almost immediately after the Special Committee was formed. The core supporting allegation appears in Count II of the original complaint in the Fiduciary Action. It states, in relevant part:
In violation of this duty of care, the Special Committee acted within less than three hours of its formation to terminate two Schnatter-related agreements. The Board could not have possibly met its obligation to consider all information reasonably available before invalidly terminating those agreements. Nor has the Board cured this flaw in its decision-making process.[118]
In my opinion, the Company has not met its burden to prove that Schnatter's purpose for seeking the documents described in Requests Nos. 1-4 is improper based on the assertion of this narrow claim in the Fiduciary Action for two reasons.
First, there are fundamental differences between inspection demands made by stockholders and those made by directors. A stockholder seeking to inspect books and records (other than a stock ledger or list of stockholders) not only bears the burden of proving that her demand is proper, i.e., reasonably related to her interests as a stockholder,[119] but also must demonstrate that the documents she seeks are "necessary and essential to satisfy [her] stated purpose."[120] As Bizzari explains, a stockholder seeking documents under Section 220 to investigate claims of mismanagement undercuts her ability to make the second showing by asserting claims in a plenary action challenging the same alleged acts of mismanagement.
By contrast, a director "who has a proper purpose is entitled to virtually unfettered access to the books and records of the corporation,"[121] and it is the corporation's burden to prove that the director's purpose is improper, i.e., not "reasonably related to the director's position as a director."[122] And, importantly, standing to bring a claim on behalf of the corporation has not been extended to a director under Delaware law.[123] Thus, if Schnatter obtains documents in response to the Demand, he may use them internally at the Company to advance his point of view, but he may not use them to pursue a derivative claim unilaterally. Presumably recognizing this limitation, Schnatter has represented he will not use any documents produced in response to the Demand to assert a claim as a stockholder without first obtaining the Company's consent to do so.[124]
No authority has been brought to the court's attention in which a director's right to access books and records under Section 220(d) has been denied based on his filing of a plenary claim as a stockholder. Bizzari is not that case. Given (i) the lack of any such authority, (ii) the significant differences in our law between inspection demands made by stockholders and those made by directors, (iii) the fact that a director lacks standing to assert derivative claims in that capacity, and (iv) the fact that Schnatter has agreed not to use any documents produced in response to the Demand to file a claim as a stockholder without the Company's consent, I see no basis to deny Schnatter access to the documents described in Requests Nos. 1-4 based on his filing of the Fiduciary Action.
Second, even if one were to ignore the distinctions discussed above concerning inspection demands made by directors as opposed to stockholders, it would not be appropriate in my view to deem Schnatter's filing of a claim challenging the Special Committee's exercise of its duty of care in a very limited respect—i.e., its alleged failure to inform itself during the three hours after it was formed—to be a concession that Schnatter does not need the documents sought in Requests Nos. 1-4 to investigate mismanagement. Each of those requests only seeks documents pertaining to a time period before the Special Committee was formed, i.e., from November 1, 2017 until the July 15 Meeting. And even if such documents were relevant to Schnatter's due care claim (e.g., by showing that the directors had become informed about the Sublease and Founder's Agreements before the Special Committee was formed), Schnatter has not asserted a loyalty claim relating to the termination of those agreements and thus could not be said to have conceded that he has sufficient information to do so. In short, the Company has not proven that the acts of mismanagement Schnatter seeks to investigate through his Demand necessarily concern the same conduct he put at issue in the Fiduciary Action.

c. The Company Has Failed to Prove that Schnatter's Purpose Is Improper Based on His Alleged Lack of Familiarity with the Demand

Apart from the four reasons already discussed, the Company contends that Schnatter's purpose is improper because he "had no idea" why he is seeking many of the documents requested in the Demand.[125] For support, the Company relies on Wilkinson v. A. Schulman, Inc.[126] In that case, the court found that a stockholder who had served as a plaintiff for an "entrepreneurial law firm" in at least seven lawsuits did not have a proper purpose for inspecting a corporation's books and records.[127] The court reasoned that "the purposes for the inspection belonged to" the law firm, which (i) initiated the process, (ii) drafted "a demand to investigate different issues than what motivated the stockholder to respond to the law firm's solicitation," and (iii) pursued the inspection and litigation "with only minor and non-substantive involvement from the ostensible stockholder principal."[128]
This case bears no resemblance to Wilkinson. Here, a director of a corporation with a presumptive right to access corporate books and records made an inspection demand in response to a specific sequence of events, i.e., the Company's handling of the fallout from the Earnings Call and Forbes Article. The record here does not support the conclusion that Schnatter was so disengaged from the process that the actual purpose for the Demand was to benefit his counsel.[129]

* * * * *

For the reasons explained above, the court finds that the Company has failed to prove that Schnatter's purpose for making the Demand is not reasonably related to his position as a director of the Company. The court turns next to determining the appropriate scope of the inspection to which Schnatter is entitled.

B. Scope of Production

"If [a director's] inspection of [a corporation's] records is to effectuate its purpose of enabling him to determine whether management wrongdoing has occurred, his access to [the corporation's] records must necessarily be broad and unrestricted."[130] At the same time, even a director "must direct the Court to specific books and records related to the [director's] proper purpose. Without such direction, the Court is unable to direct production of an appropriate set of documents, and unwilling to burden the corporation to search for the same."[131]
As discussed previously, only Requests Nos. 1-4 remain in dispute. To reiterate, those requests seek:
1. Communications with and between Counsel to the Company and any officer or director of the Company from October 31, 2017 through the formation of the Special Committee at the July 15, 2018 meeting of the Board of Directors (the "July 15 Meeting") referring or relating to me. For purposes of this Demand, Counsel shall mean any outside counsel to the Company, including without limitation, Hogan Lovells US LLP, Gibson Dunn & Crutcher, LLP, in-house counsel to the Company, and any counsel representing any director in connection with such director's service on the Board of Directors (the "Board").
2. Communications between or among directors, and/or any director and Counsel from October 31, 2017 through the July 15 Meeting relating to the article on Forbes.com's website published on or about 5:00 a.m. on July 11, 2018 referring to me (the "Forbes Article").
3. Communications between or among directors, and/or any director and Counsel from October 31, 2017 through the July 15 Meeting referring or relating to me.
4. Communications between or among directors and Counsel from October 31, 2017 through the July 15 Meeting referring or relating to Schnatter Group Arrangements as that term is defined in the resolutions adopted at the July 15 Meeting appointing the Special Committee (the "July 15 Resolutions").
Although the term "Counsel" is defined in the Demand to include any personal counsel "representing any director in connection with such director's service" on the Board, Schnatter no longer seeks such communications and their production will not be required.[132] Schnatter also has limited the potential custodians to the following: the other directors, Ritchie, and Caroline Oyler, the Company's General Counsel.[133] This list is reasonable. I also find that the time period covered by Requests Nos. 1-4 is reasonable. Each request covers a limited period of less than nine months that begins with the Earnings Call, when the concerns to which Schnatter testified began to arise, and ends with the formation of the Special Committee.
As stated, however, Requests Nos. 1-4 are overbroad relative to the attested purpose for the Demand in one key respect. For example, to the extent those requests seek communications "referring or relating" to Schnatter without further qualification (e.g., Requests Nos. 1 and 3), they are not sufficiently related to Schnatter's purpose of investigating mismanagement and must be narrowed. In my opinion, Schnatter is entitled to the communications sought in Requests Nos. 1-4 only to the extent such communications reflect any consideration of changing Schnatter's relationship with the Company, which would include assessments of his behavior or performance in his various roles at the Company (e.g., as a director, officer, or spokesman), during the specified time period.
Two issues remain concerning the scope of production: (i) Schnatter's request to obtain emails and text messages from personal accounts and devices, and (ii) privileged communications. These issues are addressed, in turn, below.

1. Production of Emails and Text Messages from Personal Accounts and Devices

Schnatter requests access to emails and text messages from personal accounts and stored on personal devices. In Indiana Electrical Workers Pension Trust Fund IBEW v. Wal-Mart Stores, Inc., a stockholder sought to inspect emails and other documents stored on the directors' personal devices concerning the board's handling of a bribery scandal involving Wal-Mart's Mexican division.[134] Then-Chancellor Strine ordered production, observing that a director usually owes an obligation to the corporation "to share that information with the company when the company needs it."[135] Subsequently, this court has both granted and denied access to personal email accounts and devices of directors and officers in Section 220 actions.[136]
In opposing Schnatter's request for emails and text messages from personal accounts and devices, the Company relies on Chammas v. NavLink, Inc.[137] In that case, two directors of NavLink who suspected that other board members had been meeting without them sought access under Section 220(d) to certain communications between or among management, the board Chairman, and/or any of the other board members during a defined period.[138] In rejecting this request, the court explained:
Mere suspicions of pre-meeting collusion among board members or board members and management, in the context of a Section 220 action, is insufficient to compel the production of private communications between such officers and directors, even to the extent that such communications are stored on the defendant company's servers. While directors' access to company books and records is broader than that of stockholders, the requested information itself must qualify as a book or record of the company before the Court will order its production.[139]
The Chammas court then articulated a three-part test for determining when a request for communications among corporate directors and officers may be produced in response to a Section 220 demand:
The Court notes that while this holding is not to be interpreted as a blanket prohibition against inspection of private communications among directors, subjecting Section 220 proceedings to such broad requests, even by directors, runs contrary to the `summary nature of a Section 220 proceeding.' As such, any request for communications among corporate directors and officers must (1) state a proper purpose, (2) encompass communications constituting books and records of the corporation, i.e., those that affect the corporation's rights, duties, and obligations, and (3) be sufficiently tailored to direct the Court to the specific books and records relevant to the director's proper purpose.[140]
With respect to the second element, the court cited Estate of Polin v. Diamond State Poultry Co. for the proposition that "documents subject to a Section 220 request are limited to `those which were intended to reflect on the business, condition or legal rights of the corporation.'"[141]
Focusing on the second element of the Chammas test, the Company resists the production of emails and text messages from personal accounts and devices, arguing that "Schnatter is just curious about what his fellow fiduciaries were saying about him."[142] The Company would have a point if the custodians were required to produce documents referring to Schnatter without qualification. As discussed above, however, the court has limited the scope of the Company's production in response to Requests Nos. 1-4 to communications reflecting any consideration of changing Schnatter's relationship with the Company, including assessments of Schnatter's behavior or performance in his various roles at the Company, during the specified time period. Modified in this way, Requests Nos. 1-4 seek documents that satisfy the definition suggested in Chammas and the earlier precedent on which it relies for what constitutes books and records of a corporation for purposes of Section 220.
A further word is in order regarding emails and text messages from personal accounts and devices. The reality of today's world is that people communicate in many more ways than ever before, aided by technological advances that are convenient and efficient to use. Although some methods of communication (e.g., text messages) present greater challenges for collection and review than others, and thus may impose more expense on the company to produce, the utility of Section 220 as a means of investigating mismanagement would be undermined if the court categorically were to rule out the need to produce communications in these formats. Accordingly, I decline to adopt that approach.
In my view, consistent with the sentiments then-Chancellor Strine expressed in Wal-Mart, if the custodians identified here—the Company's other directors, CEO, and General Counsel—used personal accounts and devices to communicate about changing the Company's relationship with Schnatter, they should expect to provide that information to the Company.[143] That would apply not only to emails, but also to text messages, which in the court's experience often provide probative information. In so holding, I do not mean to suggest any form of a bright-line rule. To the contrary, when considering requests for information from personal accounts and devices in Section 220 proceedings, the court should apply its discretion on a case-by-case basis to balance the need for the information sought against the burdens of production and the availability of the information from other sources, as the statute contemplates.[144]

2. Privileged Communications

It is well-established under Delaware law that, subject to certain recognized limitations, a "director's right to information extends to privileged material."[145] Here, with one possible exception, no argument has been made that, to the extent the court finds that Schnatter is entitled to inspect books and records of the Company, his entitlement would not extend to privileged communications to which his fellow directors were privy.
The possible exception concerns documents involving communications with Akin Gump during the two-day period between July 13, 2018, when the firm was contacted to represent the yet-to-be-formed Special Committee, and the July 15 Meeting, when the Special Committee formally was established. This issue was the subject of briefing, but it is unclear to the court whether the parties resolved the matter in reaching a resolution of Requests Nos. 5-17 of the Demand, which include a series of requests concerning the Special Committee. If the parties have not resolved this issue, they should so inform the court in connection with submitting a proposed form of order to implement this decision. Subject to this caveat, privileged communications responsive to Requests Nos. 1-4, as modified by the court, to which other directors of the Company were privy shall be produced to Schnatter.

C. Conditions on Production

The Company argues that any production of documents to Schnatter that results from this action should only be made subject to entry of an order containing three conditions: that Schnatter be (1) required to comply with the Board's confidentiality policy; (2) prohibited from using any such documents in his Fiduciary Action or a future fiduciary action; and (3) prohibited from sharing any such documents with his counsel in this action.
With respect to the first proposed condition, the Company acknowledges that "Delaware law has long suggested that directors need not sign confidentiality agreements to obtain documents under Section 220."[146] Rather, there is a "presumption that the production of nonpublic corporate books and records to a stockholder making a demand pursuant to Section 220 should be conditioned upon a reasonable confidentiality order."[147] This distinction is logical because directors, unlike stockholders, are fiduciaries who owe the corporation a duty to protect its information.[148] Given that Schnatter already is obliged as a fiduciary to protect the Company's information, and given that he confirmed during his trial testimony that he would abide by the Board's confidentiality policy with respect to any documents provided to him in this action,[149] I decline the Company's first request.[150]
With respect to the second proposed condition, as discussed above, Schnatter's counsel represented during post-trial argument that Schnatter would not use any documents produced in response to the Demand to assert a claim as a stockholder without first obtaining the Company's consent to do so. For the sake of clarity, the court will require that the parties include a provision formally documenting this representation in the implementing order.
The last proposed condition concerns Schnatter's counsel in this action: Glaser Weil and his Delaware counsel, Bayard, P.A. Relying on this court's decisions in Henshaw v. American Cement Corp.[151] and Holdgreiwe v. Nostalgia Network, Inc.,[152] the Company argues that both firms should be prohibited from seeing any documents produced to Schnatter as a result of this action because those firms also represent him in the Fiduciary Action. The Company further argues that Glaser Weil should be prohibited in the same manner for the additional reason that the firm represents two women who have made sexual harassment allegations against Company management.[153]
In Henshaw and Holdgreiwe, the court barred a director from sharing corporate books and records with other persons (including their lawyers) who had interests adverse to the corporation.[154] Here, by contrast, the Company seeks to bar Schnatter from using his own lawyers to inspect the Company's books and records. I am not persuaded that Schnatter's own counsel should be barred because of the pendency of the Fiduciary Action from reviewing documents Schnatter is entitled to see himself as a director. Barring Schnatter's lawyers from helping him with the inspection would be prejudicial to Schnatter because it would require him to retain new counsel to perform that task. Furthermore, the risk that the documents could be used adversely to the Company can be mitigated by subjecting Schnatter's lawyers to the same use limitation to which he has consented, i.e., not to use the documents to press a claim as a stockholder without first obtaining the Company's consent.
With respect to Glaser Weil's representation of the two alleged victims of sexual harassment, there is insufficient information in the record to permit the court to assess the nature and level of Glaser Weil's potential adversity to the Company based on this representation. The record also is insufficient to permit the court to assess whether or not any alleged conflict could be handled—as Glaser Weil contends it could—using ethical walls within the firm.[155] As such, the court will not bar Glaser Weil from assisting Schnatter based on its representation of these individuals. Of course, it will be incumbent upon Glaser Weil to take whatever measures are necessary to ensure compliance with its professional responsibilities.

IV. CONCLUSION

For the reasons explained above, Schnatter is entitled to inspect documents responsive to Requests Nos. 1-4, as modified by the court, in accordance with this opinion. The parties are directed to confer and submit an implementing order within five business days.
IT IS SO ORDERED.
[1] PTO ¶ 12 (Dkt. 47).
[2] PTO ¶ 13.
[3] PTO ¶¶ 21, 26; JX 2.
[4] PTO ¶ 14.
[5] PTO ¶ 15.
[6] PTO ¶ 17.
[7] JX 4 at 1; Tr. 22.
[8] Tr. 10, 20.
[9] PTO ¶ 20.
[10] Tr. 8-9; JX 6 at 5.
[11] Tr. 10.
[12] Tr. 10-11, 47, 171-72.
[13] JX 6 at 8.
[14] JX 6 at 19; Tr. 172-73.
[15] JX 8 at 2.
[16] JX 11 at 3.
[17] Tr. 16.
[18] Tr. 18-20.
[19] PTO ¶ 21.
[20] JX 10 at 1.
[21] Tr. 23-24.
[22] Tr. 24-25.
[23] Tr. 25-26; see also JX 23 at 1.
[24] Tr. 165-66; PTO ¶ 23.
[25] Tr. 27.
[26] Tr. 27-28.
[27] Tr. 28-29.
[28] PTO ¶ 24.
[29] PTO ¶ 25; JX 12.
[30] JX 12 at 1-2.
[31] JX 12 at 2 (internal quotation marks omitted); Tr. 29.
[32] JX 12 at 2.
[33] PTO ¶ 26; Tr. 37.
[34] See JX 15, 18, 21.
[35] JX 17 at 2.
[36] PTO ¶ 29.
[37] Tr. 37.
[38] PTO ¶ 27; JX 36; Tr. 38.
[39] PTO ¶ 28.
[40] JX 23 at 1.
[41] JX 23 at 1-2.
[42] Schnatter Dep. 223-24.
[43] JX 26 at 1-2.
[44] PTO ¶ 30.
[45] PTO ¶¶ 31, 16.
[46] PTO ¶ 32; JX 25 at 3-5.
[47] PTO ¶ 18.
[48] JX 80 at 8.
[49] PTO ¶¶ 30-33.
[50] PTO ¶ 34; JX 2; JX 3.
[51] JX 30 at 1.
[52] JX 30 at 2.
[53] JX 37 at 3.
[54] JX 35 at 1-3.
[55] JX 35 at 3.
[56] PTO ¶ 37; JX 53.
[57] JX 32 at 1.
[58] PTO ¶ 39.
[59] JX 66.
[60] JX 66 at 2.
[61] JX 66 at 2.
[62] JX 66 at 2.
[63] Tr. 184.
[64] JX 71 at 1.
[65] PTO ¶ 41.
[66] PTO ¶ 42; JX 76.
[67] JX 76 at 1.
[68] JX 76 at 5-61.
[69] JX 88 at 1.
[70] JX 88 at 1.
[71] JX 202.
[72] JX 90 at 1.
[73] JX 90 at 1.
[74] PTO ¶ 44.
[75] Tr. 76, 182-83.
[76] JX 92 ¶ 74.
[77] JX 92 ¶¶ 77-99.
[78] JX 92 ¶¶ 100-06.
[79] Def.'s Reply Br. Ex. B (Dkt. 58).
[80] Dkt. 63.
[81] 8 Del. C.§ 220(d).
[82]Chammas v. NavLink, Inc., 2016 WL 767714, at *6 (Del. Ch. Feb. 1, 2016) (citations and internal quotation marks omitted).
[83]Bizzari v. Suburban Waste Servs., Inc., 2016 WL 4540292, at *8 (Del. Ch. Aug. 30, 2016).
[84]Id. (citation and internal quotation marks omitted); see also Holdgreiwe v. Nostalgia Network, Inc., 1993 WL 144604, at *3 (Del. Ch. Apr. 29, 1993) (same).
[85]Chammas, 2016 WL 767714, at *6.
[86]Seinfeld v. Verizon Commc'ns, Inc., 909 A.2d 117, 121 (Del. 2006) (defining burden of proof as preponderance of evidence for 220(b) proceedings); see also Sec. First Corp. v. U.S. Die Casting & Dev. Co., 687 A.2d 563, 567 (Del. 1997) (same).
[87]Physiotherapy Corp. v. Moncure, 2018 WL 1256492, at *3 (Del. Ch. Mar. 12, 2018) (citation and internal quotation marks omitted).
[88]Henshaw v. Am. Cement Corp., 252 A.2d 125, 129 (Del. Ch. 1969).
[89]Holdgreiwe, 1993 WL 144604, at *3 (citation omitted).
[90]See JX 35 (demanding production of seventeen categories of documents); JX 53 at 1-2 (stating that "the Company would be justified in rejecting the Demand in its entirety" and offering significantly fewer categories of documents than were requested).
[91] 8 Del. C.§ 220(d).
[92] JX 35 at 3.
[93] JX 79 at 13.
[94] JX 201 at 6. The Company requests that the court strike Schnatter's amended interrogatory response given that he reconfirmed his original response at trial and no testimony was elicited at trial about his amended response. Def.'s Opening Br. 24. Given that the amended response is referenced only for purposes of background, this request is denied.
[95] Tr. 66-67.
[96] Tr. 182.
[97] Post-Trial Tr. 70.
[98]See Post-Trial Tr. 70, 110.
[99]Sec. First Corp., 687 A.2d at 567.
[100] Def.'s Opening Br. 17.
[101] Def.'s Opening Br. 17.
[102] Compl. ¶ 1 (Dkt. 1).
[103] Tr. 77-79.
[104] Def.'s Opening Br. 18.
[105] Tr. 6-7. See JX 2 at 1 (Founder's Agreement stating that Schnatter "will," among other things, "participate in commercials and other high profile public relations events").
[106]See supra Section I.B-C.
[107] The Company argues that "Schnatter must show `ample evidence that [he] has a bona fide need to inspect the corporate records in order to ensure that [management] has not engaged in any mismanagement of [the Company].'" Def.'s Opening Br. 25 (quoting Holdgreiwe, 1993 WL 144604, at *4). This quotation of Holdgreiwe mischaracterizes its holding. Although the court in Holdgreiwe noted as a factual matter that there was "ample evidence" the director in question had a bona fide need to inspect corporate records, it did not hold as a legal matter that the director bore the burden of showing ample evidence of mismanagement to justify his inspection. Such a proposition would be at odds with the burden of proof the statute places on the corporation when a director makes an inspection demand. See 8 Del. C.§ 220(d) ("The burden of proof shall be upon the corporation to establish that the inspection such director seeks is for an improper purpose.").
[108] Def.'s Opening Br. 18.
[109]Bizzari, 2016 WL 4540292, at *6 (holding that need for documents sought in inspection demand to investigate mismanagement and wrongdoing was undercut by filing of pending plenary action challenging same conduct); Cent. Laborers Pension Fund v. News Corp., 2011 WL 6224538, at *2 (Del. Ch. Nov. 30, 2011) (holding that stockholder was "unable to tender a proper purpose for pursuing its efforts to inspect" books and records given that its "currently-pending derivative action necessarily reflects its view that it had sufficient grounds for alleging both demand futility and its substantive claims without the need for the assistance afforded by Section 220"); see also King v. VeriFone Hldgs., Inc., 12 A.3d 1140, 1148 (Del. 2011) (acknowledging that dismissal of later-filed Section 220 action was proper when the "stockholder-plaintiff's plenary derivative complaint was still pending and the plenary court had not granted the plaintiff leave to amend"); Baca v. Insight Enters., Inc., 2010 WL 2219715, at *4 (Del. Ch. June 3, 2010) ("[A] stockholder does not act with a proper purpose when the stockholder attempts to use Section 220 to investigate matters that the same stockholder already put at issue in a plenary derivative action."); Taubenfeld v. Marriott Int'l, Inc., 2003 WL 22682323, at *3 (Del. Ch. Oct. 28, 2003) (noting that filing a derivative complaint "was a certification under Rule 11 that the plaintiffs had enough information to support their allegations").
[110] 2016 WL 4540292.
[111]Id. at *4.
[112]Id. at *6.
[113]Id.
[114]Id.
[115]Id. at *8.
[116]Id. at *8-9.
[117]Id. at *1.
[118] Derivative Compl. ¶ 79 (C.A. No. 2018-0646) (Dkt. 1). The Company makes no argument that the other matters raised in the five claims of the original complaint concern the same subject matter as Requests Nos. 1-4.
[119] 8 Del. C.§ 220(c).
[120]Pershing Square, L.P. v. Ceridian Corp., 923 A.2d 810, 816 (Del. Ch. 2007) (emphasis added); see also Polygon Glob. Opportunities Master Fund v. West Corp., 2006 WL 2947486, at *3 (Del. Ch. Oct. 12, 2006) (finding stockholder plaintiff stated proper purpose of valuing its shares but denying inspection because it had "all `necessary and essential' information from public filings"); Marathon P'rs, L.P. v. M&F Worldwide Corp., 2004 WL 1728604, at *4 (Del. Ch. July 30, 2004) ("The scope of inspection should be circumscribed with precision and limited to those documents that are necessary, essential and sufficient to the stockholder's purpose.").
[121]McGowan v. Empress Entm't, Inc., 791 A.2d 1, 5 (Del. Ch. 2000) (Jacobs, V.C.).
[122] 8 Del. C.§ 220(d).
[123]Schoon v. Smith, 953 A.2d 196, 199 (Del. 2008).
[124]See Post-Trial Tr. 72, 110-11, 119-20.
[125] Def.'s Opening Br. 20. The Company also contends that Schnatter's "varying sworn testimony" concerning the stated purpose for his Demand proves that he has no proper purpose. Id. 22-24. I disagree. As discussed above (see supra Section III.A.1), there was some confusion about Schnatter's stated purpose, but the asserted variations in Schnatter's testimony are overblown and largely explainable by the reality that, in order to investigate mismanagement by others, a director must first become informed himself about the underlying facts and circumstances.
[126] 2017 WL 5289553 (Del. Ch. Nov. 13, 2017).
[127]Id. at *2-3.
[128]Id.
[129] Contrary to the Company's portrayal, Schnatter was conversant in many details about the Demand. See, e.g., Schnatter Dep. 62 (explaining why date range in Demand was chosen); Schnatter Dep. 105 (explaining why he seeks certain documents related to formation of Special Committee).
[130]Holdgreiwe, 1993 WL 144604, at *7 (granting plaintiff-director's requests "fully and completely").
[131]Chammas, 2016 WL 767714, at *8 n.98.
[132] Post-Trial Tr. 78.
[133]See Dkt. 63 at 2; Post-Trial Tr. 84-85.
[134] C.A. No. 7779-CS, at 81, 97 (Del. Ch. May 20, 2013) (Strine, C.) (TRANSCRIPT).
[135]Id. at 98.
[136]Compare Amalgamated Bank v. Yahoo! Inc., 132 A.3d 752, 792-93 (Del. Ch. 2016) (granting access to CEO's personal email account), with In re Lululemon Athletica Inc. 220 Litig., 2015 WL 1957196, at *6-7 (Del. Ch. Apr. 30, 2015) (denying access to directors' personal email accounts).
[137] 2016 WL 767714.
[138]Id. at *6.
[139]Id. at *7 (internal citations omitted).
[140]Id. at *8 (internal citations omitted).
[141]Id. at *8 n.97 (quoting Polin, 1981 WL 7612, at *3 (Del. Ch. Apr. 14, 1981)).
[142] Def.'s Opening Br. 33.
[143] According to Schnatter's counsel, the Company's directors do not have Company email addresses. Post-Trial Tr. 79. The Company has not suggested otherwise. Nor did the Company introduce at trial a policy indicating that it views any information from the personal accounts or on the personal devices of its directors or officers to be "personal unrestricted information" outside the control of the Company. See Wal-Mart, C.A. No. 7779-CS, at 97-98.
[144] 8 Del. C.§ 220(d) ("The Court may, in its discretion, prescribe any limitations or conditions with reference to the inspection, or award such other and further relief as the Court may deem just and proper."); see also id.§ 220(c) (substantively identical provision for stockholder inspection demands).
[145]In re CBS Corp. Litig., 2018 WL 3414163, at *4 (Del. Ch. July 13, 2018) (quoting Kalisman v. Friedman, 2013 WL 1668205, at *4 (Del. Ch. Apr. 17, 2013)).
[146] Def.'s Opening Br. 47.
[147]Disney v. Walt Disney Co., 857 A.2d 444, 447 (Del. Ch. 2004) (emphasis added).
[148]See Edward P. Welch et al., 1 Folk on the Delaware General Corporation Law § 141.02[A], at 4-41 (6th ed. 2018) ("A director's duties include a duty to protect corporate information." (citing Shocking Techs., Inc. v. Michael, 2012 WL 4482838, at *9 (Del. Ch. Oct. 1, 2012))).
[149] Tr. 147-48; see also JX 35; JX 100.
[150]See Holdgreiwe, 1993 WL 144604, at *6 (commenting that conditioning a director's right to inspect books and records "on his entry into an agreement binding him not to disclose any of the information he obtains to any third parties . . . seems to me to add little. He is already under an obligation to maintain the confidences of Nostalgia. . . . Disclosure of such information . . . is a violation of duty whether or not an undertaking is entered.").
[151] 252 A.2d 125 (Del. Ch. 1969).
[152] 1993 WL 144604.
[153] Tr. 153-54; JX 85.
[154]See Henshaw, 252 A.2d at 130 (prohibiting a director (Henshaw) from conducting an inspection using (i) a law firm that represented another director (Caldwell) in a lawsuit against the corporation and (ii) Caldwell's administrative assistant); Holdgreiwe, 1993 WL 144604, at *1, *7 (prohibiting a director (Holdgreiwe) from conducting an inspection using any professionals who had been employed by Concept Communications, Inc., which was engaged in a struggle for control of the corporation, or any of its affiliates "for any purpose other than this inspection of documents").
[155]See Post-Trial Tr. 105, 109-10.
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