Monday, January 23, 2006

Sarbanes-Oxley vs. the free press

In Reason, journalist and Competitive Enterprise Institute fellow John Berlau has written a thought-provoking piece, Sarbanes-Oxley vs. the Free Press, on how the law enacted to promote corporate accountability could be used by federal prosecutors to bring media executives to their knees.

Enacted in the wake of the Enron scandal, the law broadly prohibits corporations from obstructing federal investigations and altering, destroying or concealing documents. It would not be a stretch, Berlau argues, for a zealous prosecutor to extend the law to a media company protecting a source or a reporter's notes. In fact, he suggests, this may have been at least part of the impetus for Time Inc. to have turned over Matthew Cooper's notes to Plamegate prosecutor Patrick Fitzgerald.

Berlau concludes:
"Reporters and commentators in the establishment media need to rethink their cheerleading for Sarbanes-Oxley and so-called corporate reform. From their privileged perch, journalists frequently have advocated giving prosecutors and grand juries more power over their fellow citizens, especially those who work for big corporations. But prosecutors like Fitzgerald see a media company as just another corporation. Now that the media are under the government’s thumb, they may be a bit more skeptical in covering the crusade against corporate crime."

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