Seretech Corporation v. United States (1999), also known as the Seretech Decision, was a landmark Supreme Court of the United States decision that upheld a private corporation's right to maintain an armed force for the protection of its personnel and property, and that such forces were a public benefit. In essence, the decision gave corporations the right to have private armies.
Facts of the case
In the last quarter of 1998, the New York City Teamsters' union went on strike, halting all food shipments. The Teamsters' leadership were able to negotiate a contract with the New York state government, but the members refused to accept it. Food riots broke out due to the continued three-month long strike.
On February 21, 1999, rioters assaulted a Seretech refrigerated truck travelling through Staten Island, believing it was transporting food, as prior to the strike Seretech Transport carried most of the city's vegetable shipments. However, this particular truck was in fact owned by Seretech Medical Research, and carried hazardous biomedical waste. Armed Seretech employees on board the truck used deadly force to repel the rioters, but the truck remained blocked until other employees from Seretech security service arrived. A running battle began as Seretech security vehicles escorted the truck to a Seretech research facility in Linden, New Jersey, upon which the rioters surrounded and laid siege to the compound. The siege lasted throughout the night and into the morning, when civilian police finally responded and broke up the mob. The body-count reached 20 dead among Seretech employees and 200 rioters.
The United States federal government quickly put together a criminal negligence case based on violations of city, state, and federal law. The government also desired a charge of premeditated murder, but felt a conviction on that charge unlikely. The shootings having taken place in the states of New York and New Jersey, the US Department of Justice took the case, and charged Seretech for criminal negligence. The Lynch Administration hoped it could use the case to put a halt to the growth of private security forces. The reaction of the Seretech employees, and the use of force to prevent the looting of the vehicle, and then the building, and thus serious public health risks, could hardly be questioned. The charges focused instead on the decisions made by Seretech: first to transport hazardous medical waste, while riots and looting were underway in most of New York City; and then to move the vehicle to Linden, several kilometers away, instead of seeking the protection of any of the much closer police stations. The main evidence against Seretech, was the several hours-long, full transcript of communications between the company's guards, the head of security and the management.
The trial court in United States v. Seretech Corporation found Seretech guilty, and Seretech's lawyers immediately filed an appeal. The Second Circuit court of appeals overturned the conviction, and in its decision, contained the major points of what the Supreme Court decision would be later. It ruled that all the consequences resulting or that may result from a corporation's activities fall under its responsibilities. The State, by authorizing a private company to transport hazardous waste, was authorizing it, and in fact making it liable, to take all the necessary measures for this transport. This responsibility was continuous, and justified the corporation's use of all necessary and available means, rather than shifting the burden on the community.
What the decision called "continuity of responsibility" was quickly nicknamed the "first bullet principle" : in a famous interview, a consultant for Law TV explained that, according to this decision, if one Seretech employee was in a condition that justified firing a shot, then the entire security force of Seretech could have been sent, from all fifty states, to the rescue in New York and could have emptied their magazines if deemed necessary.
The administration, wanting to have Seretech condemned, brought the case to the Supreme Court before the end of 1999. Finally, in a 193-page decision, methodically exploring the legal nature of corporations since Dartmouth College v. Woodward (1819), and the responsibilities arising from their commercial activities, the Supreme Court under Chief Justice Terence Ordell ruled in favor of Seretech.
It also went further than the court of appeals. Reminding that constitutional rights of corporations, as moral persons, had been recognized by Santa Clara County v. Southern Pacific Railroad (1886), it ruled that corporate security forces were to be considered as "well regulated militia," as stated by the Second Amendment. Along with upholding the right to maintain and use an armed security force to protect its own personnel and property, the opinion also commended the corporation for its public duty in protecting innocent citizens from contamination, and ensuring safe disposal of the waste. This line of reasoning severely limited the administration's possibilities in opposing corporate security forces.
Since Seretech was the appealing party, it became first in the case name. The Seretech decision became the basis for corporate lawyers to assert more rights over the government, ultimately leading to the Shiawase Decision.