Piercing the Corporate Veil of Secrecy

Congratulations to Wikileaks, Wal-Mart Watch and a handful of other web resources for being chosen by Portfolio magazine as the “top anti-corporate sites.” Specifically, the magazine is featuring sites that have done the most to distribute confidential—and often embarrassing—corporate documents or otherwise publicize material that companies want kept quiet. “From anonymous whistle-blowers who post secret documents online to fan sites that spill trade secrets,” Portfolio writer Kim Zetter says, “websites and their owners can be a major thorn in the side of corporations that find comfort behind a veil of secrecy.”

Wikileaks is focused on piercing that veil. The site was at the center of controversy a few months back when Swiss bank Julius Baer tried to get it taken offline after it posted documents that purportedly showed how the bank’s Cayman Islands branch helps wealthy clients hide assets and launder money. Much of the web community rallied to the defense of Wikileaks, and the censorship move was defeated.

Wal-Mart Watch, of course, is one of two national campaigns aimed at reforming the giant retailer. Aside from producing its own critiques of the retailer (including one to which I contributed), the group has used its site to publicize internal company documents leaked to it. Among these was a memo in which the company discussed controlling health care costs by methods such as making physical activity part of every job, apparently so that those in poorer shape would not apply.

The other sites singled out by Portfolio are:

* Mini-Microsoft, a anonymous blog written by a Microsoft employee who skewers management and highlights waste and inefficiency at the software behemoth.

* Brenda Priddy and Company, a automobile outfit that is not necessarily critical of carmakers but which manages to take clandestine photographs of their prototype vehicles and sell them to other websites and magazines for distribution well before the companies are ready to go public.

* Farmers Insurance Group Sucks, a site produced by a disgruntled customer who now publicizes lawsuits against the company, complaints to state insurance agencies, and unflattering insider testimonials.

* HomeOwners for Better Buildings, a site that exposes the shortcomings of the residential construction business, especially KB Homes. It is filled with homebuyer horror stories and has an “Implode-O-Meter” that tracks companies in the industry experiencing bankruptcy or other forms of distress.

* AppleInsider and MacRumor, which make it their business to report on new Apple products and features being developed by the secretive company.

Zetter has only scratched the surface, and she seems to realize it. She says to her readers: “If you have suggestions for other pesky sites that are a reliable source for inside information about a company or industry, please let us know. We’ll write about the best ones in a follow-up article.” So go ahead and let Zetter know about the wider world of the corporate-critical web.

8 thoughts on “Piercing the Corporate Veil of Secrecy”

  1. I would suggest there is a fundamental difference between sites that expose malfeasance, and those that provide sneak previews of products.

    If we were speaking of individuals, the latter behavior would be considered a violation of privacy. What’s the difference between paparazzi taking photos over the fence, and people sneaking photos of car models that haven’t been released? Neither serves the public interest.

  2. I agree with you that taking sneak pictures of new car models does not advance the effort to control corporate power, but there are sites in which rumors about a company’s marketing plans may overlap with criticism of the firm’s practices.

  3. To Nick:

    The answer to your questions about the difference between paparazzi taking photos over the fence, and people sneaking photos of car models that haven’t been released is that the former involves human beings and the latter involves corporations, which — despite rhetoric to the contrary — are not human beings.

    The tendency by the media and the general public to equate the two is quite corrosive.

    Moreover, if the media are not allowed to report things that corporations would prefer the public didn’t know — ranging from faulty products and other forms of malfeasance, abuse, or criminal conduct to plans to cut prices or discontinue products — that sets a dangerous precedent and a legal privilege exceeding even that claimed by (and allowed by the courts for) the government.

  4. Just noticed the countercorp reply. To wit:

    Let me rephrase my question: Are corporations – when involved in legitimate activity – presumed to have the right to privacy?

    In answering this, consider not only the case of a multi-billion dollar global corporation, but an individual (artist, inventor) who incorporates to protect his/her legitimate intellectual property. Isn’t that person (corporation) reasonable in wanting to protect themselves from snoopers?

    The fact is that corporations and individuals do meet in the limit of the very small company – which dominate the business landscape in terms of numbers. It’s not clear to me where/how you draw a line when it comes to rights like privacy (for legitimate activities).

  5. I don’t think corporations have a “right” to privacy. I’m not a lawyer, but it seems to me that rights are either inherent and thus inalienable — i.e., derived from one’s existence as a person and thus irrevocable — or conferred, such as by the U.S. Constitution or acts of legislation.

    I know of no source that claims that corporations — which, after all, are legal constructs created under state laws in the U.S. — have an inherent and inalienable right to privacy. (For that matter, there is considerable debate as to whether people themselves have a *right* to privacy; much of what is considered our right to “privacy” is derived from case law.)

    There are some laws that confer limited corporate rights to trade secrets and other proprietary information, but these tend to be written in terms of the competitive advantages that flow from keeping certain information from rival companies. It’s debatable whether such laws were designed or should be applied to stave off the curiosity of zealous consumers (i.e., Apple fans).

    They certainly do not confer upon corporations the right to publicly exhibit forthcoming products (as was the case in the article that prompted this discussion) and then use the legal system to try to prevent members of the public from publishing pictures of those products.

    I’m among a great many people who have real difficulty with the very notion of so-called “intellectual property” — a doctrine largely created by and for the benefit of large corporations that seek to fence in the cultural and scientific commons (and that routinely violate the very principles that they claim to support when it serves their interests).

    Those who defend the so-called “rights” of corporations often use the individual as a convenient proxy for the much larger institutions on behalf of which they argue. Thus, they prefer to focus on a sole proprietor because they know that this elicits more sympathy than, say, Chevron or the RIAA.

    The fact is, individual *people* are already protected by legal mechanisms such as patents and copyrights — though it is worth noting that in both cases, that protection is limited and not nearly as all-encompassing and absolute as corporations would have us believe.

    (For example, the government does not defend patent infringement on behalf of inventors — the latter must bring those claims themselves, and so-called “reverse-engineering” of inventions is legal under U.S. patent doctrine.)

    The ultimate form of privacy for the individual is to keep their “art” or invention to themselves — it is only when people seek to profit from their works by promoting them publicly that they willingly expose themselves to public scrutiny, and then seek legal protection from that public and that scrutiny.

    (The small businesses that you mention in your example are far more likely to find their rights violated by much larger corporations than by the general public. Just ask anyone who’s ever written a movie script, found a photo or image they created being used in corporate marketing campaign, or had an invention stolen by a company that they tried to sell it to.)

    The deep pockets of large corporations have bankrolled a steady erosion of individual and collective/public rights vis-a-vis the promotion of art/ideas/inventions, and the pendulum has swung too far in the direction of these large, private interest, and there are now increasing calls for reforms that would protect the commonwealth from the predations of the same corporations you seem to see as “victims” …

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