DAY 2 of CU

Recap of Citizens United

• Narrower scale: BCRA limitations on corporate expenditures couldn't be enforced upon CU

• Overruled Austin's limitations on corporations on a broader scale

• Upheld only the disclosure and disclaimer requirements

Professor BirdthistleTheories of Corporations in Citizens United

Prof. StantonPublic Law vs. Private Law• Corporations, what we've traditionally

thought of within the realm of private law, overtime, have 'breached' into the realm of public law

• They're now able to donate without reporting (SuperPACs) and blur the lines between private law activities and public law (engaging in public discourse).

• Corporations through contacting parties or concessions is a 'mask' for public/private arenas.

The "Big Picture"Corporate Personhood

Corporate PersonhoodThe concept that corporations have the same rights as natural persons

Corporate Personhood

Where did it come from?

Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the government for a redress of grievances.

Corporate Personhood

Where did it get its start?

Trustees of Dartmouth College v. Woodward, 17 U.S. 518 (1819): the Supreme Court recognizes that corporations have the same rights as natural persons to contract and to enforce contracts.

Corporate Personhood

Santa Clara County v. Southern Pacific Railroad, 118 U.S. 394 (1886): before oral argument, Chief Justice Waite said,

"The Court does not wish to hear argument on the question whether the provision in the Fourteenth Amendment to the Constitution which forbids a state to deny to any person within its jurisdiction the equal protection of the laws applies to these corporations. We are all of opinion that it does. "

Corporate Personhood

Pembina Consolidated Silver Mining Co. v. Pennsylvania, 125 U.S. 181 (1888): affirms the doctrine of corporate personhood addressed by Chief Justice Waite by holding,

"Under the designation of 'person' there is no doubt that a private corporation is included [in the Fourteenth Amendment]."

Corporate Personhood

Limits to corporate personhood:

Hugo Black, dissenting in Connecticut General Life Insurance Company v. Johnson, 303 U.S. 77 (1938) wrote,

"If the people of this nation wish to deprive the states of their sovereign rights to determine what is a fair and just tax upon corporations doing a purely local business within their own state boundaries, there is a way provided by the Constitution to accomplish this purpose. That way does not lie along the course of judicial amendment to that fundamental charter. An amendment having that purpose could be submitted by Congress as provided by the Constitution. I do not believe that the Fourteenth Amendment had that purpose, nor that the people believed it had that purpose, nor that it should be construed as having that purpose."

Corporate Personhood

Justice William Douglas, with whom Black concurred, dissenting in Wheeling Steel Corp. v. Glander, 337 U.S. (1949), wrote

see next slide; it's a lot of writing

Both Mr. Justice Woods in Insurance Co. v. New Orleans, supra, Fed.Cas.No. 7,052, 1 Woods page 88, and Mr. Justice Black in his dissent in Connecticut General Co. v. Johnson, supra, 303 U.S. at pages 88-89, 58 S.Ct. at pages 441-442, 82 L.Ed. 673, have shown how strained a construction it is of the Fourteenth Amendment so to hold. Section 1 of the Amendment provides:‘All persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States and of the State wherein they reside. No State shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any State deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws.’ (Italics added.)‘Persons' in the first sentence plainly include only human beings, for corporations are not ‘born or naturalized.’Corporations are not ‘citizens' within the meaning of the first clause of the second sentence. Western Turf Ass'n v. Greenberg, 204 U.S. 359, 363, 27 S.Ct. 384, 385, 51 L.Ed. 520; Selover, Bates & Co. v. Walsh, 226 U.S. 112, 126, 33 S.Ct. 69, 72, 57 L.Ed. 146.2

It has never been held that they are persons whom a State may not deprive of ‘life’ within the meaning of the second clause of the second sentence.‘Liberty’ in that clause is ‘the liberty of natural, not artificial, persons.’ Western Turf Ass'n v. Greenberg, supra, 204 U.S. at page 363, 27 S.Ct. at page 385, 386, 51 L.Ed. 520.But ‘property’ as used in that clause has been held to include that of a corporation since 1889 when Minneapolis R. Co. v. Beckwith, 129 U.S. 26, 9 S.Ct. 207, 32 L.Ed. 585, was decided.It requires distortion to read ‘person’ as meaning one thing, then another within the same clause and from clause to clause. It means, in my opinion, a substantial revision of the Fourteenth Amendment. As to the matter of construction, the sense seems to me to be with Mr. Justice Woods in Insurance Co. v. New Orleans, supra, Fed.Cas.No. 7,052, 1 Woods at page 88, where he said, ‘The plain and evident meaning of the section is, that the persons to whom the equal protection of the law is secured are persons born or naturalized or endowed with life and liberty, and consequently natural and not artificial persons.’

Corporate Personhood

Chief Justice Rehnquist, dissenting in Bellotti (1978), criticized the Court's invention of corporate constitutional "rights."

However, even he eventually voted to overturn Austin in his dissent in McConnell v. FEC.

CLASS DISCUSSIONHave corporations gained more power than their

charters originally assigned?

Should corporations have all of the same rights as natural persons?

Should they be limited? How far should corporate personhood extend?

Contract and similar suits? Is there a logical end point?Is it merely an endless slippery slope?

Corporate Personhood or Corruption?

"Institutional corruption does not refer to the knowing violation of any law or ethical rule....It instead describes an influence, financial or otherwise, within an economy of influence, that weakens the effectiveness of an institution, especially by weakening public trust in that institution...Congress is a paradigm case."

- Larry Lessig, in a September 2010 Boston Review article

Professor Stanton• Takes the benefits of private, but affects the public

through lobbying and "purchase of political office" - moves its agenda onto the public.

• Through charters that pretty much let the business do whatever it wants; the business judgment rule isn't enough of a check on the corporation.

• What's next? Corporations having the right vote and hold public office? Is there an end point?

Corporate Personhood or Corruption?

Limits on Corporate Personhood or Limits on Corruption?Should corps be able to vote in elections?

The court says that giving money is no different than political speech. Is voting political speech? If so, should corps be allowed to vote?

Do they need to reach 18 years of age to vote?

What if I incorporate 1,000 corporations in Florida, a highly contested state in Presidential elections, and upon each of them turning 18, use my vote (as the only shareholder and sole board member) of the corps to vote how I want? I now have 1,001 votes toward the candidate of my choice. Should this be allowed?

Larry Lessig vs. Citizens UnitedLarry Lessig

Counsel for Citizens United:"Before this decision, it was difficult for

individuals to get their voices heard. Now, individuals can pool their money and speak through a corporation or nonprofit and have a greater political voice." - Amir Tayrani

Debate: Whose perspective is correct?

Lessig spoke of corruption within Congress itself, but this isn't too surprising.

What should the public be more concerned with: money being spent to sway voters or corrupt politicians?

Are they intertwined?

Corruption at multiple levels

If one corporation, who cannot actually vote in an election, spends an exorbitant amount of money to sway voters, is democracy losing anything?

Does the 'marketplace of ideas' truly allow all speech to be heard when one voice spends more money to be heard than other voices?

Is the democratic process a dream of the past?

Polikoff heavily wrote about the decision as a disaster. He asks,

"Since all the 'Citizens United money' poured into the 2012 campaign failed to elect Romney, does that undercut the argument of those (including me) who think the decision is a disaster for democracy?"

Polikoff and CU

-We need regulations to keep the marketplace as open as possible.

-What regulations do we need?-If we believe that money is speech, and you can speak as much as you want, then we're in a game where it's just the giants that have the megaphone and they're going to shut everyone else out.-Possible solution: shortening the campaign season?-Does this get in our way to talk about political issues?

Stanton's thoughts

Throughout the semester, we've noticed attorneys arguing that they're doing public policy work in areas that are not traditionally "public policy" fields.

• Are the attorneys who represented CU engaging in public policy work?

• How are they different that the attorneys for Hobby Lobby?

• For-profit vs. non-profit?

Corporations, corruption, and public policy

Are organizations that work to reform political and campaign spending engaged in the public policy arena?

Does this blur the line between what is and isn't public policy work?

Corporations, corruption, and public policy