U.S. Constitution, Article I, Section 9, third paragraph;
"No Bill of Attainder ... shall be passed. ...
Unintended Consequences: The Chickens Are Coming Home to Roost
The U.S. Constitution (Article I, Section 9) prohibits “Bills of Attainder,” i.e., writing or enforcing laws that apply only to certain individuals.
But that is exactly what has been happening to Elon Musk and, especially, Donald Trump.
Judge Kathaleen McCormick of the Delaware Court of Chancery said that Mr. Musk’s performance-based compensation, though approved by 80 percent of Tesla’s shareholders, was unfair and must be taken apart (just how, she has yet to specify).
Mr. Bush and Mr. Lonsdale point out one likely unintended consequence.
“Mr. Musk’s performance at Tesla enriched all shareholders, but Judge McCormick’s ruling may primarily enrich Delaware trial lawyers,” they wrote.
Another is that Judge McCormick’s action has prompted Mr. Musk to change Tesla’s state of registration from Delaware to Texas.
He will not be the only business owner to do so.
In the case of President Trump, New York Attorney General Letitia James, who actually
campaigned on the promise to target President Trump, has prosecuted him for allegedly overvaluing his real estate assets when applying for bank loans.
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The case against him was a fraud case. But no one was defrauded.
He paid back the loans that Deutsche Bank had made to him on time and with the specified interest.
For its part, the bank said it was satisfied and would be happy to do business with President Trump again.
They also suggested that President Trump’s alleged optimistic valuation of his assets—a nearly universal practice among real estate developers (to say nothing of homeowners)—may not have affected their decision to make the loans on the terms they offered.
Since there was no victim in this fraud case, the state of New York will collect the money, assuming that the judgment withstands President Trump’s appeal.
Judge McCormick and the James gang in New York are crowing about how they “got” Mr. Musk and President Trump.
They have not yet accounted for the unintended consequences that are coming their way.
Many businesses have incorporated in Delaware because the state has traditionally offered a business-friendly process of incorporation.
Judge McCormick’s astonishing intervention to harm the CEO of an important company will reverberate negatively in the C-suites of many companies. They will now look for alternative places to bring their corporate business.
The unprecedented legal assault against President Trump is already having consequences in New York.
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Roger Kimball is the editor and publisher of The New Criterion and publisher of Encounter Books. His most recent book is “Where Next? Western Civilization at the Crossroads.”
The phrase “unintended consequences” usually brings to mind something unpleasant. This is something the states of Delaware and New York are about to discover.
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