Citizens United Research Articles

Through a Glass, Darkly: The Rhetoric and Reality of Campaign Finance Disclosure

In Citizens United v. FEC, the Supreme Court swept away long-standing limits on corporate spending in federal elections, but it also strongly affirmed the constitutionality of robust disclosure and disclaimer requirements. In the wake of that decision, many proponents of campaign finance regulation have turned their attention to disclosure as the best remaining mechanism by which to regulate money in elections. At the same time, opponents of campaign finance regulation — including the legal team behind Citizens United — have trained their sights on disclosure, filing new challenges to existing disclosure require- ments in a number of state or federal courts, although so far with only limited success.Relying on the Longitudinal Elite Contributor Database (LECD) — an original database developed by one of the authors to track the population of unique individual campaign contributors from 1980 through 2008 — this essay tests the Supreme Court’s rhetoric about disclosure, and some of the premises of our current policy debates about money in politics, against the realities of the FEC’s existing disclosure regime. In particular, we find that compliance with existing disclosure regulations is inconsistent and that the current regime fails to identify the most potentially influential players in the campaign finance system. In so doing, the current system fails to provide basic facts about how candidates (and committees) finance their campaigns. We suggest that much of what the Court and reformers assume about disclosure is wrong — that their views are premised on an effective and well-functioning disclosure regime that in fact bears scant resemblance to the system of disclosure maintained by the FEC. Correcting these misunderstandings will be critical to crafting better reform proposals. And the stakes could not be higher: disclosure may well be the only constitutionally viable and politically feasible method of regulating money in elections in a post-Citizens United world.

Shifted Personhood: Technology, Organizations, and Law on the Path to Citizens United and Hobby Lobby

This article tells a nuanced story about law, technology, and social change as they interacted in the evolution of corporations in the United States over two centuries. Most prominently, it is the first to illuminate how the Supreme Court’s view of the relationship between television and the provision of information to people in a mass society shaped its decision to extend the First Amendment’s protection of freedom of expression to corporations in Citizens United. It adds new complexity to the “antidistortion interest,” reveals how judges can easily put their norms in place of legislatures’ when they reason about technology, and suggests how the legal regulation of technology can become an instrumental part of social order. Most broadly, the article provides a model for explaining technology-influenced legal change and brings forward legal aspects of the study of corporations from the Industrial to the Information Age. Its farthest-reaching implication is to explain how personhood has “shifted” between corporations and individuals within the constitutional order, bringing their rights into conflict in new ways, as in the recent Burwell v. Hobby Lobby Stores.

Corporate Social Responsibility & Concession Theory

This Essay examines three related propositions: (1) Voluntary corporate social responsibility (CSR) fails to effectively advance the agenda of a meaningful segment of CSR proponents; (2) None of the three dominant corporate governance theories – director primacy, shareholder primacy, or team production theory – support mandatory CSR as a normative matter; and, (3) Corporate personality theory, specifically concession theory, can be a meaningful source of leverage in advancing mandatory CSR in the face of opposition from the three primary corporate governance theories. In examining these propositions, this Essay makes the additional claims that Citizens United: (A) supports the proposition that corporate personality theory matters; (B) undermines one of the key supports of the shareholder wealth maximization norm; and (C) highlights the political nature of this debate. Finally, I note that the Supreme Court’s recent Hobby Lobby decision does not undermine my CSR claims, contrary to the suggestions of some commentators.

The Tension Between Lobbying and Campaign Finance Laws: Rolling Back Gains Made Under the Honest Leadership and Open Government Act of 2007

This article analyzes the convergence of campaign finance law and lobbying law that began in earnest under the Honest Leadership and Open Government Act (HLOGA) of 2007. Though the laws governing the field of campaign finance have historically been quite distinct from the laws governing lobbying—the former focused on regulating behavior, while the latter emphasized disclosure—the two have begun to merge in some key areas following the ethics and lobbying scandals associated with the Jack Abramoff era. The manuscript documents the history and nature of HLOGA, analyzes where HLOGA merged campaign financing with lobbying regulation, shows the impact of the Citizens United decision, and measures the law's successes and failures in this effort. The study reveals some notable accomplishments but also finds several egregious shortcomings in the implementation of the law. It concludes with noting where and how HLOGA needs to be revisited.

The Worst Test of Truth: The 'Marketplace of Ideas' as Faulty Metaphor

Dissenting in Abrams v. United States, Justice Holmes proclaimed that “the best test of truth is the power of the thought to get itself accepted in the competition of the market.” Economic markets have since become a pervasive metaphor for free speech. This Article critiques the basic argument that underlies this metaphor: that speech should be “free” because markets are “free,” and because free markets produce “truth.” These assertions about markets are taken for granted, but they portray markets and market regulation inaccurately. Economic markets thus provide a poor analogy for the deregulation of speech. First Amendment jurisprudence invokes the supposed truth-finding function of markets to argue that competition, not law, should distinguish the true from the false. Thus, the law should also refrain from attempting to equalize the relative strength of competing speakers. The Supreme Court relied on the “anti-equalizing” principle — and the marketplace metaphor — to strike down restrictions on corporate political spending in Citizens United v. Federal Election Commission (2010). The assumptions of the metaphor are inconsistent with theory and experience, however. Economic markets do not produce normative or empirical “truth.” Existing regulatory law reflects this understanding. Mail fraud law and securities regulation, for example, assume that markets are particularly bad at identifying the truth, and thus information is more aggressively regulated in the market context than in other contexts. Economic regulation also assumes that markets require some degree of “equalizing.” Antitrust law and insider-trading law, for example, treat certain types of advantages as impediments that must be corrected in order to ensure that markets remain competitive. The marketplace metaphor has proven effective in defending unpopular speech. It has also (perhaps inadvertently) contributed to the general pervasiveness of free-market rhetoric and ideology in legal discourse. But the metaphor is based on a normative vision of unregulated markets, and not on market theory or experience. Thus it is ultimately little more than an antiregulatory assertion that provides no insights into how the law should deal with speech or markets.

Does 'The Freedom of the Press' Include a Right to Anonymity? The Original Understanding

This Article examines legal and historical evidence to determine whether, as some have argued, the original legal force of the First Amendment’s freedom of the included a per se right to anonymous authorship. The Article concludes that, except in cases in which the press had been abused, it did. Thus, from an originalist point of view, Supreme Court cases such as Buckley v. Valeo and Citizens United v. Federal Election Commission, which upheld statutes requiring disclosure of donors to political advertising, were erroneously decided.

McCutcheon and the Meaning of Corruption: Not All Quid Pro Quos are Made of the Same Stuff

This Article critiques the use of pro a method of defining corruption in campaign finance law cases. I argue first that pro has no definite meaning. Therefore, one doesn't avoid the problem of defining corruption by attaching quid pro quo to it. In the case law, sometimes it means explicit agreements, sometimes it means agreements about specific things, sometimes it is redundant, and sometimes it encompasses gifts in exchange for a promise to help out as opportunities arise, a definition that sounds very close to the influence seeking that a majority of the Court has previously categorized Second, I show that pro language has shallow roots. It is not a major part of traditional white collar criminal law doctrine: it appears through Buckley, and gets ported over to bribery laws. Relatedly, I show that pro is not a requirement in many states for proving bribery. Third, I argue that the use of pro a limit in criminal bribery law comes from Due Process and prosecutorial discretion, not from the meaning of corruption itself. This kind of limit makes sense when interpreting criminal laws: the same limits don't make sense when interpreting the constitutional meaning of corruption. Due Process-derived constraints should be understood for what they are, not definitional constraints. Fourth, I show how the importation of bribery law terms to constitutional law deliberations reflects a positivism that is uniquely poorly suited to corruption definitions. What the Court has already done in Citizens United, and seems poised to do in McCutcheon, is port over the definition of corruption from a smattering of “intent” based white collar criminal statutes in order to define the scope of corruption a (quasi-)Constitutional principle. The portage is done through the language of pro quo. As I argue in this piece, this transference is not justified, is bad history, and makes bad law. It is an early draft, and comments are welcome!

Corporate Rules and Political Rules: Antitrust as Campaign Finance Reform

This Article addresses itself to two of the most significant political moments in the last decade: the Supreme Court decision in Citizens United v. FEC, and the 2008 bailout of the “Too Big To Fail” companies. It proposes that in light of these two watershed moments, policy makers should explore new antitrust laws with absolute size caps. First and foremost, it proposes that the existing division between the study of market structure and the study of political structure disables both fields. It argues that corporate rules are political rules, and should be treated as such, and understood in terms of their impact on democratic design. In particular, antitrust, which was considered a political tool for the first sixty years of its existence, should be again understood politically. Second, it argues that large-scale companies have disproportionate influence in the political marketplace because of their size. It engages the public choice “rent-seeking” literature, using models to show why spending money on politics becomes cheaper and more likely with scale. The models suggest significant economies of scale in the production of political power, and therefore greater incentives for larger companies to spend money seeking wealth through changes in laws and regulations instead of innovation and development. The existing evidence conforms to these models. In light of the model and evidence, it proposes new laws that would limit the absolute size of all limited liability companies. The laws would be enforced through the antitrust framework, but also rely on the self-enforcement of liability rules (companies over a certain size would lose limited liability). The Article anticipates several objections to the proposal: most prominently the objection that limiting size would be harmful for our economy. It reviews the evidence, demonstrating that in the production of goods and services over a certain size, there is very little evidence that large size adds social value. In the final section, the article explores some unproven assumptions about the relationship between size and the pursuit of political power that might help explain why scholars concerned with rent-seeking have not previously embraced a robust size-based antitrust.

Friend of the Court: on the front lines with the First Amendment

Since 1971, when the Pentagon Papers were leaked to the New York Times and furious debate over First Amendment rights ensued, free-speech cases have emerged in rapid succession. Floyd Abrams has been on the front lines of nearly every one of these major cases, which is also to say that, more than any other person, he has forged this country's legal understanding of free speech. Litigating everything from national-security and prior-restraint issues to controversies concerning the law of libel and attempts by local officials to censor art, Abrams has worked devotedly to protect the First Amendment, the crown jewel of America's Constitution. This collection of Abrams's writings gathers speeches, articles, debates, briefs, oral arguments, and testimony from his entire career. The writings illuminate topics of ongoing import: WikiLeaks, the correctness of the Citizens United case, journalist shield laws, and, not least, the responsibilities of the press. An exceptional writer and a brilliant thinker, Abrams offers a unique perspective on the First Amendment and the unparalleled rights it confers.

Business Ethics After Citizens United: A Contractualist Analysis

In Citizens United v. Federal Election Commission (2010), the US Supreme Court sharply curtailed the ability of the state to limit political speech by for-profit corporations. This new legal situation elevates the question of corporate political involvement: in what manner and to what extent is it ethical for for-profit corporations to participate in the political process in a liberal democratic society? Using Scanlon’s version of contractualism, I argue for a number of substantive and procedural constraints on the political activities of businesses. Central to this contractualist analysis is (1) an identification of the self-governance-based interests of individuals that are affected by corporate political activity and (2) a method for judging the various assignments of social rights, duties and roles according to how they collectively meet those interests. Together, these two features make this contractualist approach distinctive and allow it to generate substantive ethical results.

Corporate Political Speech: How Nigeria Threw Away the Baby with the Bath Water: Any Lesson from Citizens United?

This paper examines the concept of Corporate Political Speech in a Democracy. Corporation being a legal person is clothed with distinct attributes necessary for its existence as a person and for the realization of its goals and objectives. The paper reasons that Corporation must speak out in politics to influence ideas and enrich debates in the political marketplace. As a person, the Corporation is entitled to rights to free speech. Unfortunately in Nigeria, the message is blatant and uncompromising a business corporation has no business in politics. It must follow political debates and policies sheepishly and slavishly without a voice. The paper finds that the blanket-ban on Corporate Political Donations in Nigeria has bred a black market for corporate speech. It juxtaposes the Nigerian position with the US jurisdiction with a view to finding a suitable model for Nigeria’s nascent democracy.

Independent Spending in State Elections, 2006–2010: Vertically Networked Political Parties Were the Real Story, Not Business

This article examines independent spending in state elections before and after the Supreme Court's 2010 decision in Citizens United v. FEC. We find that the decision did not have much of a direct effect on business spending, despite public expectations. Increases were higher in the aggregate in states that prohibited corporate spending before the decision. However, the major growth was not in the business or labor sectors, but in the network organiza- tions of political parties - and most particularly the national organizations of state elected and party officials. Contrary to some contemporary views, these developments cannot be understood as a displacement of within-state money from parties to interest groups. Instead, national party organizations were oper- ating across state lines, deciding whether to contribute to formal party com- mittees or their party allies as local circumstances might dictate. This complex movement of money belies any theorizing that would treat a decline in the pro- portional role of formal party spending as equivalent to a zero-sum increase in the non-party power of interest groups. Rather, we see the pattern of independ- ent spending as part of a larger story of change in American political parties. These changes now include vertically networked parties operating across levels of jurisdiction, alongside the horizontal networks receiving attention in recent scholarship.

Blurring Lines between Churches and Secular Corporations: The Compelling Case of the Benefit Corporationns Right to the Free Exercise of Religion

The United States Supreme Court will soon hear oral arguments on two cases, Sebelius v. Hobby Lobby Stores, Inc. and Conestoga Wood Specialties Corp. v. Sebelius. Both cases present similar questions with regard to the applicability of the First Amendment’s “Free Exercise Clause” to corporations. In Hobby Lobby, the Tenth Circuit found that Free Exercise rights existed for a corporation, without regard to its status as a non-church, profit-seeking entity. In Conestoga, however, the Third Circuit agreed that a corporation could have Free Exercise rights, but such rights did not apply if the corporation happened to be “secular” and “for-profit”, defining characteristics which appear nowhere in the Constitution and which are contrary to recent First Amendment jurisprudence and other precedent, including the seminal case of Citizens United v. Federal Election Commission. Why would there be such a distinction relating to a right as fundamental as the exercise of religion? According to the Conestoga court, it all comes down to profit. A legal entity that exists to produce profits for those who organized it can’t exercise religion, but one that exists without an interest in profits miraculously is vested with the right to exercise religion. In Hobby Lobby, the court summarized (and subsequently rejected) the government’s position as being a black and white distinction between non-profit religious organizations, which have Free Exercise rights, and for-profit secular organizations, which have no such rights. The government made the same argument in Conestoga, and in that case the majority adopted the government’s position.Not only is the government’s distinction arbitrary and without logical or legal basis, it is utterly at odds with recent developments in corporate law.The advent of the “Benefit Corporation” (or “B-Corp”) has formally established a gray area between the black of the non-profit religious organization and the white of the for-profit secular organization with respect to First Amendment rights generally and Free Exercise rights specifically. Indeed, a corporation organized as a B-Corp can be religious and formed for purposes other than the sole pursuit of profit. Such a creature was apparently beyond the knowledge of the Conestoga court.Well, not the entire Conestoga court. Judge Kent Jordan, in his meticulously argued dissent, touched upon the radical upheaval in the law occasioned by the recent establishment of the B-Corp in many states, pointing out that a B-Corp, like a religious non-profit corporation, is a legal entity that exists for purposes other than the solitary pursuit of profit; in fact, B-Corps can be formed in furtherance of religious purposes, much like a religious non-profit.The purpose of this paper is to elaborate on Judge Jordan’s discussion of B-Corps in his Conestoga dissent and further, to argue that not only should Free Exercise rights apply to corporations that have a religious purpose, such as B-Corps, but also such rights should exist for what I refer to as “de-facto B-Corps.”This paper concludes with an epilogue that summarizes the decision in the Hobby Lobby/Conestoga case and discusses the implications of any Congressional attempt to undermine the Supreme Court's decision through changes to RFRA or any other statute that would purport to strip free exercise rights from for-profit corporations. In such a case, the Supreme Court would have an opportunity to decide the case on First Amendment grounds. This paper argues that the Hobby Lobby/Conestoga opinion set out the groundwork for future courts to use strict scrutiny (the same standard under which RFRA cases are decided) under the Smith “individualized” exemption doctrine to strike down any Congressional attempts to deprive for-profit corporations of their First Amendment Free Exercise rights.

Citizens United from a Historical Perspective: Corporate Person, Corporate Rights, and the Principle of Confiscation

The Supreme Court’s 2010 decision in Citizens United v. Federal Election Commission is often criticized for having declared that corporations are persons with the same constitutional rights as human beings. Using standard theories of the nature of the corporation as a guide, this paper traces the concept of corporate personhood from its mythical birth in the 1886 Santa Clara case. This historical perspective reveals that the Court has never settled on one theory of the nature of the corporation. Even after Citizens United the concept of corporate person remains little more than a metaphor or legal fiction. The real significance of Citizens United is that it ignored the traditional limitation on corporate constitutional rights. The idea of corporate constitutional rights springs from early Contract Clause doctrine holding that a state could not deprive a corporation of the essential object of its grant or confiscate corporate property. By ruling that the rights of corporations are not limited to issues that materially affect its business or property, the majority in Citizens United casually dismissed this principle of confiscation. It thus rejected both the most significant limitation on corporate constitutional rights and underlying rationale for giving corporations constitutional rights in the first place.

Book Review: Too Much Free Speech? by Randall P. Bezanson

Randall P. Bezanson Too Much Free Speech? Urbana: University of Illinois Press, 2012. 266 pp.Stanley Fish's declaration that there's no such thing as free and it's a good thing, too turned on the meaning of the word free. The answer to the question posed by the title of Iowa law professor Randall Bezanson's well-argued book similarly depends on the meaning of speech under the First Amendment. In a careful and detailed analysis of five major cases heard by the U.S. Supreme Court over the past two decades, Bezanson argues that the Court's failure to acknowledge the limits of its own judicial or base its rulings on a clear application of first principles has greatly expanded the scope of First Amendment protection. To Bezanson, that is not a good thing.The book has five main chapters, each one a meticulous and compelling analysis of one of the five cases. In each chapter, the author lays the facts and legal issues of the case and then walks the reader through the parties' main points in their briefs and in oral argument. He makes great use of the transcripts of oral argument, at times cri- tiquing the justices' questions and the attorneys' answers. These sections contain the most absorbing reading of the book-not only do they help the reader understand how the Court's opinions were shaped, but they also offer an inside look at the justices' interactions and the rhetorical challenges that face the advocates standing before them. Bezanson concludes each chapter with an analysis of the justices' opinions, including the concurrences and dissents, and his conclusions regarding the practical and doctri- nal consequences of the decision.The first chapter looks at the most recent of the cases, Citizens United v. Federal Election Commission (2010), in which the Court overruled existing precedent to extend full First Amendment protection to business corporations for political speech. Bezanson criticizes the decision as unsupported by either the text or history of the First Amendment. His discussion of Pleasant Grove City v. Summum (2009) in the next chapter includes a primer on public forum analysis and on the relatively new doctrine of speech, which regards the government's acceptance or rejection of private messages-in this case, a proposed monument for a city park-as a act that is itself entitled to First Amendment protection. The Court's use of the doctrine to allow the government to discriminate based on the message conveyed unleashed a dangerous power (p. 110), Bezanson concludes-one that endangers traditional pub- lic forum law and allows the First Amendment to be used as a shield to protect the government from the people, rather than the other way around.The next two chapters deal with the Court's willingness to extend constitutional protection to arising out of thin air (p. 2)-that is, to a message with no obvi- ous speaker or a speaker with no obvious message. …

Political Spending and Shareholder Wealth

We examine the impact of the Citizens United decision on firm value. While the value of U.S. firms do not respond significantly to the Citizens United decision on average, we find evidence that firms in industries subject to more extensive regulation react significantly and positively to the announcement. We also find evidence consistent with Justice John Paul Stevens’ argument that the Court decision will affect state laws. Specifically, our results indicate that firms that are headquartered in states with more stringent limits on political spending by corporations respond positively to the announcement.

Sustaining Refusal and Imagining New Societies: The Scarlet Letter , “Bartleby,” and the Production of “Somewhere Else”

����� ��� How can we restore or reinvent such political conceptions of happiness, joy, and love for our world? A conventional answer to such a question might offer a political program against misery, meaning by misery not only the lack of wealth and resources but also and more generally the lack of power to create and innovate, to rule oneself. Misery is the condition of being separated from what one can do, from what one can become. —Michael Hardt and Antonio Negri, Commonwealth For those who desire to create a society based on the principle of human freedom, direct action is simply the defiant insistence on acting as if one is already free. —David Graeber, “On Playing by the Rules” In writing about literary responses to the miscount of persons during the antebellum period, I find myself thinking about twenty-first century manifestations of the miscount. I adapt my notion of the “miscount” from Jacques Ranciere’s Dis-agreement: Politics and Philosophy, where he argues that all political systems rely on a fundamental miscount, wherein all parts, or persons, are not part of the sum; Ranciere refers to those left out of the system as “those who have no part” (11). Those without a part lack certain shared rights or privileges and exist somewhere on the periphery of the community. Starting with the Florida recount in the 2000 presidential election, United States politics in this century have exposed a variety of sites of domination, social inequality, and civil death. Arizona and Alabama passed anti-immigration laws that not only defined groups of persons who could not be part of each state’s people, but they also called on citizens to participate in the policing of civic boundaries. Over two million Americans, many from black and brown populations, are incarcerated in United States prisons. Following the 2008 election of Barack Obama, ten states passed or bolstered voter ID laws in ways that disproportionately impinge on voting rights in poor and minority communities. The 2010 Citizens United v. Federal Elections Commission Supreme Court decision upheld the free speech of corporations and, in the process, ensured that corporate support for political

SOFT MONEY AND CAMPAIGN FINANCE REFORM

We analyze special interest influence on policy when political contributions are capped but the regulation contains soft‐money loopholes. The politician chooses between two policy options. We define special interest influence as the probability the politician chooses the policy he would not have chosen in the absence of contributions. Any binding cap reduces special interest influence but the effect may be nonmonotonic. A ban on contributions can result in greater special interest influence than a binding but nonzero cap. The results may also have implications for the policy response to the 2010 Supreme Court ruling on Citizens United v. FEC.

Collateral Damage

Unprecedented numbers of negative political advertisements aired in battleground markets during the 2012 primaries, the first presidential campaign since the 2010 Citizens United decision. Grounded in theories of involvement, this investigation parses the influence of partisanship and political expression on the affective effects of negative Super PAC ads. Based on a pretest–posttest design with two experimental conditions and 585 participants, the results indicate both enduring and situational involvement exerted significant main and interaction effects on viewers’ affect toward the general election candidates and the political parties. Driven by Independents who did not engage in political expression, these Super PAC ads evoked significant net decreases in affect toward Mitt Romney and the Republican Party and net increases toward Barack Obama and the Democratic Party. These results suggest enduring and situational involvement moderate the affective effects of negative Super PAC advertising in primary contests.

Mass Democracy in a Postfactual Market Society: Citizens United and the Role of Corporate Political Speech

This chapter addresses the problems underlying Citizens United v. FEC (2010), a case decided by the United States Supreme Court in 2010. Part I discusses political speech within a context defined by three factors: (1) electorates that are so large that speech must address them largely by using “mass media”; (2) a postfactual culture where analysis and debate often rely on distortions, misstatements, or fabrications of factual matters; and (3) a market society where effective political speech depends largely upon having the financial ability to use mass media. After discussing the legal fiction of corporate personhood, Part II argues first, that Citizens United has a reasoned basis and second, that critics allow their concern about the role of wealth in politics to divert them from addressing both the basis of the decision and other avenues of reform. Part III discusses measures to limit the role of money in politics and the problem that, in a market society, speech is always, to some extent, for sale.