Waxman Demands CEOs Disregard the Law

by Benjamin Domenech on 10:16 am March 30, 2010


My latest at the Daily Caller talks about the ridiculous demands of Henry Waxman to the CEOs of Verizon, AT&T, and other companies that have dared to follow the law in their 8-K filings:

If the CEOs’ statements or subsequent testimony conflict with internal memos or downplay risks to their companies that eventually come to pass, or if they back off plans to save their shareholders money, they expose their companies and themselves personally to shareholder class-action lawsuits for securities fraud or breach of fiduciary duty. These would be filed, coincidentally enough, by Waxman’s allies in the trial bar.

Thus the CEOs face the choice of a fiduciary breach or a political backlash from partisan Washington. It’s still better to obey the law, even if a powerful Democratic Chairman gives you hell for it.

One key point that I neglected to mention in the column: Waxman references a Business Roundtable study as proof these CEOs are incorrect. But the estimates from last fall were for the reform steps the Roundtable recommended — not the ones ultimately included in Obamacare.

Slight difference, that.

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