Re:Ticketmaster will pay $10M for hacking rival ticket seller
by kyboren on Thursday December 31, 2020 @10:32PM
(#25600586)
OK, shareholders might get some proceeds after secured and unsecured creditors, but as I am sure you're aware, share prices are generally a multiple of book value. With a corporate death penalty, the net present value of the expected future earnings of the company is 0.
A fine can be paid and the organization simply continues. But the point of the corporate death penalty is that the organization ceases to operate; executives and board members lose their plum positions in ignominy; shareholders lose enormous value; and the rotten people and incentive structures in the organization are scattered into the wind.
Who do you think gets the liquidation proceeds? If not the shareholders, one, that’s expropriation, which rule-of-law countries try to avoid. And two, that’s easier achieved with a fine.
For businesses requiring a license, suspending licenses could kill a business. Otherwise, “death penalty” is, at best, an expensive way to levy a fine and, at worst and most likely, inchoate.