4 - Commentary on Dodge v. Ford Motor Company

Summary

The plaintiffs, John and Horace Dodge, owned a ten percent share in the defendant’s, Ford Motor Company (FMC), corporation. The Dodge brothers had recently started their own car company, but the Dodge Brothers retained interest in FMC, which had paid hefty dividends. Henry Ford very publicly decided to stop paying dividends to investors and to build a new plant in River Rouge, Michigan, which would drive competition for lower priced vehicles. The Dodge brothers filed this suit in response. The case highlights the debate over the fundamental purpose of business: investor benefit or societal benefit. Through the lens of feminist theory, Ford’s approach would promote both the financial interests of FMC and the equitable access to private transportation to the betterment of society. By withholding dividends, FMC could maintain a cash reserve in times of financial adversity; meanwhile, by driving down the price of cars, private transportation could be more widely available to even the most marginalized groups who were more likely to experience harassment on public transportation. The feminist perspective argues that the notion that a corporation’s only purpose being to immediately maximize profits for the sake of stockholders is too narrow a view.