LONDON, March 3, 2003 (PRIMEZONE) -- U.K. media group, SRI Media, and specialist corporate governance and corporate responsibility ratings agency CoreRatings Limited, announced today they have filed a "friend of the court" legal brief in the United States Supreme Court case of Kasky v. Nike. The United States Supreme Court is expected to rule on this matter before the end of the year.
The U.S. Supreme Court case has taken an appeal from the decision of the California Supreme Court in Kasky v Nike, in which a California activist named Marc Kasky sued Nike, Inc. (NYSE:NKE) for "false advertising" over the accuracy of communications by Nike to the media and potential customers over its labor practices in Asian factories. The California Supreme Court affirmed Mr. Kasky's right to prosecute the civil litigation, denying a "First Amendment" (or 'freedom of speech') defense raised by Nike. Nike appealed to the United States Supreme Court, which on January 10, 2003 accepted the case for hearing. At stake is the ability of enterprises (and companies specifically) willingly and openly to provide information on their business operations and risks to financial, rating and other stakeholder groups.
Thomas H. Clarke, Jr. of Ropers, Majeski, Kohn and Bentley, Supreme Court counsel for the two European groups, stated "The issue in this case is the impact of the decision of a California Court upon the ability of US and European companies, media, labour unions and financial services companies to communicate and comment on their social, human rights, labour, environmental and like policies. The key issue of this case is not the allegations concerning Nike's labor practices. Rather, the key matter is the constitutional right of enterprises to freely discuss their corporate social responsibility policies, both voluntarily and in compliance with European law, without needless concern about being hauled into a California Court and subjected to interrogation by self-appointed private attorneys general."
Alan Banks, CEO of CoreRatings Limited commented "Reporting and transparency in the context of corporate governance and corporate social responsibility are issues that are of tremendous importance to European business institutions and the investment community. The European approach, increasingly being enshrined in local regulatory and legal regimes, is to ask companies to make full and open disclosure and to encourage active engagement between companies and their stakeholders. If Kasky v Nike is allowed to stand, the California decision would significantly curtail the effectiveness of this process."
Peter Clarke, Director of SRiMedia plc, further added "Europeans are committed to making corporate responsibility and corporate governance a central aspect of our institutional and individual investment climate. We are gravely concerned about the potential 'chilling' effect of the California decision upon European business enterprises who may find that their CSR communications, even though issued from Europe to a European media audience and made in compliance with European law, might well land them in a California Court because of the extra-territorial reach of the decision."