Thursday, January 21, 2010

Corporations and Speech

By Mike Dorf

Overturning two precedents, this morning the Supreme Court invalidated the application of the Bipartisan Campaign Reform Act (aka McCain-Feingold) to corporate-funded independent expenditures.  I'll have more to day about the case--Citizens United v. FEC--in my FindLaw column and an accompanying post here on Monday.  (My preview of the issues back in August appears here.)  For now, here is a quick observation about the constitutional rights of corporations.

Neither the majority nor the dissent directly cites Santa Clara County v. Southern Pac. RR, the 1886 case that said that corporations are persons under the Fourteenth Amendment.  However, the spirit of Santa Clara County could be said to hover over the opinion.  Part III(A)(1) of the opinion begins with the following statement: "The Court has recognized that First Amendment protection extends to corporations."  There then follows a citation of over 20 First Amendment cases involving corporate speakers.  First on the list is First National Bank of Boston v. Bellotti, which relies on Santa Clara County in footnote 15.   Then-Justice Rehnquist dissented in Bellotti, arguing that because Santa Clara County simply assumed that corporations are persons under the Fourteenth Amendment, it should not be controlling in First Amendment cases.

Was Rehnquist (who is looking better and better in retrospect, gulp!) right?  Many progressives have long argued that Santa Clara County was at the root of much of the mischief done by the conservative Supreme Court from the 1880s through the 1930s.  There is much to that complaint; the doctrine might have made more sense if, when the asserted rights of corporations were involved, courts were required to ask whether the constitutional rights of natural persons were infringed.

Nonetheless, even if Santa Clara County is a pernicious decision in other categories of cases, it does make some sense to treat corporations as though they have free speech rights.  Why?  Because, as a textual matter, the First Amendment protects the "freedom of speech," rather than the freedom of any particular speaker. That is why, for example, in Lamont v. Postmaster General, the Supreme Court invalidated a restriction on the receipt through the mails of "communist political propaganda," without any inquiry into whether the particular mail in question (in the lead case, "Peking Review #12") was sent by a person or entity that had a right to communicate with Americans.  The speaker as such is irrelevant.

That is not to say that the majority in Citizens United got it right.  The premise of Austin v. Michigan Chamber of Commerce--overruled in Citizens United--was that corporate campaign speech poses particular dangers not posed by speech by other sorts of actors.  Justice Stevens, dissenting in Citizens United, fully accepts that corporate speech is prima facie valuable.  But that is only the start of the inquiry.  I would end up where the dissenters end up.  Indeed, the majority opinion strikes me as remarkably tone-deaf to current political reality.  Here is how I put it in a joint statement with my colleague Steve Shiffrin for a Cornell University press release (speaking for ourselves rather than for the university, of course):
Today's decision in Citizens United v. FEC could pave the way for even further corporate domination of American politics.  For over six decades, federal law has sought to combat the corrupting influence of accumulated wealth on our democracy by forbidding corporations from using general revenues to support or oppose particular candidates for office.  In light of recent legislation such as the TARP, it would be highly disingenuous at best to argue that this prohibition has prevented well-heeled corporations from making their voices heard in the political process.   Moreover, the invalidated restriction was not, as the Court claimed, a "ban" on corporate speech: federal law permits corporations to create separately funded Political Action Committees to promote or oppose candidates for office.  In tone and spirit, the majority opinion in Citizens United  calls to mind an earlier period of conservative judicial ascendancy, when the interests of corporations were central to the Court's constitutional vision.


Paul Scott said...

I will give you my, mostly irrelevant, take.

The decision was correct. America's treatment of corporations, generally, is not.

I feel there is a distinction to be made between privately held corporations and publicly held ones that in that later, the "voice" of the owners is lost and entirely disconnected from that of the management of the corporation. Many laws, including the laws protecting freedom of speech, have lost their meaning when dealing with modern, large, public corporations.

With this later entity, the owners of the corporation are effectively voiceless in all matters that do not involve an exceptional breach of fiduciary duty by the board or management. As an entity, these forms have lost all connection to the "personship" the law grants.

My feeling is that the entirety of corporate law should be re-examined as it applies to these entities and that while the threat to the American political system these entities represent is large, the exact mechanism reflected in this case is one of the less significant ways in which the entities threaten democracy.

Patrick S. O'Donnell said...

Perhaps some readers will find this post ('Corporations as Persons') and thread prompted by a NY Times editorial prior to the ruling from the Legal Ethics Forum of interest:

Michael C. Dorf said...

A propos of Paul's comment: Much of the majority opinion's analysis rests on pointing out how the law applies to small as well as large corporations, non-profits as well as for-profits. I agree that independent campaign-related expenditures are not the main avenue by which corporations dominate American politics, but the worry is that this is the first step in dismantling the entire system of campaign regulation. Weak as that system is, its elimination could lead to something worse.

Musing Marxist said...

"[I]t makes some sense to treat corporations as though they have free speech rights...That is not to say that the majority in Citizens United got it right...corporate campaign speech poses particular dangers not posed by speech by other sorts of actors."

Are you saying that (i) corporations don't have free speech rights, but (ii) we should nonetheless subject restrictions on their political speech to strict scrutiny (i.e. treat them "as though" they had speech rights), and (iii) the restrictions at issue in Citizens United pass constitutional muster even under that standard of review?

Jet Beagle said...

"Because, as a textual matter, the First Amendment protects the "freedom of speech," rather than the freedom of any particular speaker."

Profesor Dorf, your response to my comment below would be appreciated.

The First Amendment protects a citizen from a powerful government which would decide what speech the citizen would be allowed to read or hear. It's not a right granted to a speaker, but a right granted to a listener or reader. As such, it makes no difference whether the speech being protected comes from a single person, a non-profit organization, a union, a church, or a corporation. It is not the speaker but rather the speech - and the right of the citizen to hear it - which is being protected.

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TokyoTom said...

The decision was wrong in my view not because of tone-deafness, but it conflates people with state-created entities that are not natural persons and do not as representatives for any natural persons.

The First Amendment can and should be interpreted to applying only to limitations on the "speech" of natural persons.