The Intracorporate Conspiracy Doctrine Can Protect Some Employees From Liability

When companies do wrong—say, defraud customers, or try to evade tax or immigration laws, or they steal or lie to shareholders—we know that there may not only be civil, monetary penalties, but even criminal penalties as well, in more serious situations.

But for a company to commit wrongdoing, there has to be more than one person involved. In fact, most larger schemes or plans to do something illicit, need the cooperation of multiple employees in the company.

Conspiracy or Racketeering?

Criminal laws say that when there is a crime, everybody involved in the crime and who contributes to it, can be an accessory to the crime through conspiracy and racketeering laws. So does that mean that every single person in a company that helped, contributed to, or assisted in a criminal act, can be brought up on criminal charges?

The law recognizes that many corporate employees are lower level, and may just be doing their jobs. The law knows that even if they may understand what the company is doing, they have no say, control or power, to orchestrate or direct the criminal acts. Because of that, the law does recognize what is called the intracorporate conspiracy doctrine.

Immunization From Liability

If an employee’s only act is that they did something someone else ordered them to do, they may not be liable criminally, because of the doctrine. The law seeks to help those who were “just doing their job,” so long as those employees didn’t have a significant hand in orchestrating the criminal or fraudulent scheme.

The law also recognizes that a conspiracy involves two people and two entities, and technically a company and its workers are the same entity, for conspiracy purposes. A company or person cannot conspire with itself.

No Personal Gain

Employees can’t have gained personally by the scheme or illegal actions.

In other words, it’s OK if the worker just received his or her regular salary or work benefits, but if the worker received an individual benefit because of the criminal acts that the worker assisted with, the worker won’t be protected by the doctrine.

That means that if the worker acts totally separate from the company, in an effort to attain personal gain or benefits, the doctrine wouldn’t apply to protect the worker.

But a worker can gain an indirect benefit—say, the value of the workers’ stock increase, or the worker gets some work bonuses for the success of the company—and still be protected by the doctrine.

Protection from Civil and Criminal Liability

The doctrine insulates workers who are covered, from civil liability for the company’s actions, as well as from criminal conspiracy or racketeering criminal charges.

Note that many courts have refused to extend the protections of the doctrine to civil right cases, such as for sexual or gender harassment.

Are you or your business in legal trouble? Call our Fort Lauderdale business lawyers at Sweeney Law P.A. at 954-440-3993 today.

Sources:

jdsupra.com/legalnews/the-intra-corporate-conspiracy-doctrine-27970/

caselaw.findlaw.com/fl-district-court-of-appeal/1855629.html