Citizens United v FEC: The First Amendment Rights of Corporate "Persons"

I'm about 25 pages into the 190+ page (including dissents) Citizens United v. FEC opinion on corporate speech. Thus far, the Court has been mainly concerned with explaining why the case morphed from a narrow challenge to a particular section of election law into a facial challenge to the broad prohibition on corporate and union independent expenditures. I'll leave that for the con law and election law types.

Of more interest for our purposes is the majority's reaffirmation of corporate first amendment rights:

The Court has recognized that First Amendment protection extends to corporations. ... This protection has been extended by explicit holdings to the context of political speech. ... Under the rationale of these precedents, political speech does not lose First Amendment protection “simply because its source is a corporation.” The Court has thus rejected the argument that political speech of corporations or other associations should be treated differently under the First Amendment simply because such associations are not “natural persons.”

The idea that a corporation is a legal person with constitutional rights is, of course, a controversial one. Some commentators argue that it's bad policy. In my view, however, it is a well-settled principle of US constitutional law and justifiably so.

On the one hand, the courts have never empowered corporations with "privileges of citizenship." The second clause of the 14th Amendment - the so-called Privileges and Immunities - states that: "No State shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States." But it is settled that the Privileges and Immunities Clause does not protect corporations, because corporations are not deemed citizens for purposes of the 14th Amendment. Western and Southern Life Ins. Co. v. State Bd. of Equalization of California, 451 U.S. 648, 656 (1981). Conversely, however, "It is well established that a corporation is a 'person' within the meaning of the Fourteenth Amendment." Metropolitan Life Ins. Co. v. Ward, 470 U.S. 869, 881 (1985).

The common law had long recognized the legal personality of corporate bodies. See Book I, Chapter 18 of Blackstone, Commentaries on the Laws of England (1765-1769). But what of the Constitution?

The key case for constitutional law purposes is Santa Clara County v. Southern Pacific Railroad, 118 U.S. 394 (1886). Curiously, if one carefully reads Justice Harlan's decision in that case, one will find neither a clear statement nor a citation of authority concerning whether corporations are "persons." That point, instead, is made in the syllabus by the Reporter, who related that at oral argument the Chief Justice had stated that:

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 the opinion that it does.

Despite it's somewhat odd parentage, the principle is sound.

The legislative history of the Fourteenth Amendment suggests that Congress substituted the word ''person'' for the word ''citizen'' precisely so that the provisions so affected would protect not just natural persons but also legal persons, such as corporations, from oppressive legislation. We see this view further confirmed Roscoe Conkling's recounting of the relevant legislative history in Conkling's arguments in San Mateo County v. Southern Pac. R.R., 116 U.S. 138 (1885). Conkling had been a member of the Joint Congressional Committee that drafted the 14th amendment and in Southern Pacific argued to the Justices that it had been the intent of Congress for the word "person" to include "legal" persons (corporations) as well as "natural" persons within the protective scope of the due process and equal protection clauses of the amendment. The Court accepted Conkling's argument.

As Larry Ribstein argues, this development made policy sense:

... corporations are people – the owners and others the corporation represents in litigation. These people have speech rights, rights not to be discriminated against, and so forth. I’ve written on this ...:

The Constitutional Conception of the Corporation, 4 Supreme Court Economic Review 95 (1995); Corporate Political Speech, 49 Wash. & Lee L. Rev. 109 (1992) and in my book with Henry Butler, The Constitution and the Corporation (1995) ....

So the African-American owners of this SBA-certified minority-owned contractor shouldn't lose their civil rights because they chose to do business in the corporate form. They might be required to sue as a corporation, as in this case, because that’s a convenient way to handle litigation, but that doesn’t determine their individual rights.

But courts also should recognize that, by the same principle, people shouldn't lose their speech rights just because they exercise these rights though the corporation in which they have invested.

A point that seems to have been vindicated in Citizens United.

Comments

[Greg]

Footnote 7 - Scalia's concurring opinion, Page 8

The dissent says that “ ‘speech’ ” refers to oral communications of human beings, and since corporations are not human beings they cannot speak. Post, at 37, n. 55. This is sophistry. The authorized spokesman of a corporation is a human being, who speaks on behalf of the human beings who have formed that association—just as the spokesman of an unincorporated association speaks on behalf of its members. The power to publish thoughts, no less than the power to speak thoughts, belongs only to human beings, but the dissent sees no problem with a corporation’s enjoying the freedom of the press.

[Alex]

Is there a distinction for foreign or multi-national corporations. It does not make sense to give US citizen protections to foreign corporate interests. Furthermore, it doesn't make sense that the inanimate corporations could exercise more power than actual people.

How does one say separate, say the RNC, DNC or a political action committee from a corporation?

Should we count corporations in the census too?

This is clearly the rights of the corporatocracy trampling over the rights of the people.

[Hocking HIck]

The authorized spokesman of a corporation does not speak for every shareholder -- just a few bigwigs.

From the comments at Volokh:

"The point being that the speech of a company or a union is controlled by a few insiders and will often be weakly — or even inversely — correlated to the views of the stockholders or union members. Doesn’t it seem a little strange to ground the free speech right for a corporation in the collective free speech rights of natural persons who may — and frequently will — disagree with that speech?"

[Joe]

I don't see how the owners of the corporation matter in this debate. After all, don't we teach in Corporations class that a corporation is a legal entity, separate from its shareholders? It's a bit too convenient to be mentioning the rights of those shareholders now; if they want to speak or contribute to political campaigns, they can.

[Sigivald]

Alex: One doesn't separate them. That's the point.

Can you explain how my rights are being trampled because a 501(c) or even a plain old for-profit corporation can speak politically?

(For extra credit, explain how the "media exemption" that allowed eg. the Times and Fox News and DailyKos to "speak" without cessation or limit is not "trampling on the rights of the people" despite those organizations also being "inanimate corporations"?

You've just argued, without realizing it, that media should be banned, because any media corporation can speak "louder" than any individual.

Plainly, given that newspapers existed in 1780, and that the Press is explicitly protected from restriction of speech, this is a view not expressed in the Constitution.)

[John]

The problem with corporate "person" is that corporations don't have the downsides of a real "person". Corporations more than ever are super people who can live forever, but don't breathe, eat, sleep, etc. They have rights, but not responsibilities or constraints of people. They also, reflect a small fraction of societies thinking. And, since this thinking is no longer constrained by the 1st Amendment in campaigns, a CEO in Saudi or China can now influence an election for president. Would the Saudi prince want to control American policy, of course! This is scary and will haunt us soon enough. Great going Citizen's United, you just unleashed a monster. I think we'll always remember, 1/21/10 as a day of infamy.