Deterring Corrupt Business Practices

[trenton]

I have a question about a proposed policy to see if it would be a good idea or not.  The initial premise of this proposal is that it is possible for a big corporation to calculate the consequences of a lawsuit and run a cost benefit analysis to see if it can still profit by corrupt business practices such as lying about a product's effectiveness for example.  If a corporation calculates that they will make 500 million dollars from lying a product, but that they will only be sued 200 million dollars, then this can be used to exploit the criminal justice system.

The proposed policy is punish those who exploit the criminal justice system much more harshly, such that the profit is only a fraction of the fine rather than the other way around.  One example to achieve this would be to present evidence to the court that the lawsuits were calculated.  The punishment for this would be to negate the cost benefit analysis by multiplying the profit by 2 and using this fine to make the cost benefit analysis clearly against any CEO's best interest.  In this example the company would be sued 1 billion dollars instead.

The exact number is arbitrary, but it does not matter so long as the fine is high enough to deter this practice.  I recognize that the charges could be high enough to ruin a business entirely, but the goal is tho deter this practice and improve the integrity of the court system in which the lawsuits take place.  I have a few questions about this proposal.  What are some of the possible drawbacks?  Is this idea effective at reducing some white collar crimes?  If it is a good idea, what would it take to make a policy like this into a common law?  From my point of view it seems like a simple and promising solution, but if I see this idea too simplistically, I may be overlooking something.