Corporation, n., An ingenious device for obtaining profit without individual responsibility.
Ambrose Bierce 1842-1914, American columnist and writer of horror stories, The Devil's Dictionary 1906
The purpose of a corporation is to make expensive projects possible.
A corporation places an upper limit on an investor's loss. You'd never get a nickel of investment or funding from anyone for anything if every transaction had a risk of wiping out the investor. And as I said, in a capitalist society, no funding means it ain't gonna happen.
Without corporations the economy would look like medieval Europe, where a project didn't happen unless some wealthy individual sponsored it (which also means there would be no class mobility).
The rig was, before the fire and sinking, worth about $650 million. But due to wear and tear its price has been marked down to about $27 million. Which, under this law, may be all they are on the hook for.
...
On the happy side, at least for Tranocean, they have been paid by their insurance company the $401 million for the inconvenience of loosing of the rig.
If the insurance payout was $401M then that establishes the value of the platform at the time of loss. The $27M estimate became meaningless the instant the insurance company put a value on the rig. Indeed I'd think tax authorities and the SEC might be interested in asking why an asset worth $401M was booked at only $27M.
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