WASHINGTON — Renewing the debate over the First Amendment rights of corporations, the Supreme Court yesterday heard arguments that could lead to a major loosening of restrictions on participation in elections by companies and unions.
During a special session of the Court, the justices considered the case Citizens United v. Federal Election Commission for a second time — a reargument the Court itself ordered, to weigh whether important precedents that have allowed the government to ban corporate and union expenditures in campaigns should be overturned on First Amendment grounds.
In their questioning, four justices — Chief Justice John Roberts Jr. and Justices Antonin Scalia, Anthony Kennedy and Samuel Alito Jr. — made it clear they were skeptical of the precedents and concerned about what Kennedy called the “ongoing chill” on speech that has resulted. Justice Clarence Thomas asked no questions, as usual, but he has objected to the precedents in the past and is a consistent vote against most kinds of campaign regulation.
If the Court reverses Austin v. Michigan Chamber of Commerce and the relevant part of McConnell v. FEC, critics say corporate wealth will re-enter and dominate campaigns in ways that have not been seen in more than a century.
“Since the dawn of the Republic, the Court has recognized that corporations are artificial entities that enjoy unique advantages and must therefore be subject to greater government oversight,” said Doug Kendall of the Constitutional Accountability Center. “If the Court turns its back on this constitutional text and history, it will blatantly disregard the will of the people and unleash corporate influence on elections.”
Groups that oppose campaign restrictions were cheered by the 93-minute session. “Based on today’s argument, free-speech advocates can be optimistic for a broad vindication of First Amendment rights,” said Steve Simpson, a lawyer for the libertarian Institute for Justice. “Under the First Amendment, the government has no business deciding which speakers gain admittance to the marketplace of ideas.”
Precedents challenged as speech-stifling
The argument began with former solicitor general Theodore Olson challenging the precedents as stifling expression “that is at the very core of the First Amendment,” namely debate about candidates for office. Olson was representing Citizens United, a nonprofit corporation whose documentary critical of Hillary Clinton ("Hillary: The Movie") last year was found by the FEC to violate the ban on corporate expenditures for electioneering communication.
Justice Ruth Bader Ginsburg quickly jumped in, asking Olson whether individuals and corporations have the same First Amendment rights. “A corporation, after all, is not endowed by its creator with inalienable rights.”
Olson invoked the 1964 case New York Times Co. v. Sullivan and the 1936 decision Grosjean v. American Press for the proposition that “corporations are persons entitled to protection under the First Amendment.”
Also cited at various times was the 1978 case First National Bank of Boston v. Bellotti, which said political speech does not lose its protection “simply because its source is a corporation.”
Justice John Paul Stevens, the only member of the Court who participated in Bellotti, mischievously noted aloud that the late Justice William Rehnquist dissented in that case. (Rehnquist suggested that freedom of expression was “not at all necessary” for a corporation to fulfill its commercial purposes.) Roberts, a former clerk to Rehnquist, intervened to remind everyone that Rehnquist had later changed his mind. His comment was one of several signs that Roberts is likely to support corporate free speech in the pending case.
Sotomayor cautions against broad ruling
Corporate-speech rights came up again later when Justice Sonia Sotomayor, participating in her first case as a justice, asked a question of Floyd Abrams, the First Amendment lawyer who argued along with Olson against restricting corporate speech. Sotomayor said state and federal lawmakers had been struggling for more than 100 years to find the right level of First Amendment protection for corporations. As an aside, she said that “the fact that the Court imbued a creature of the state,” namely corporations, “with human characteristics” may be the problem, not the Austin or McConnell precedents. But she asked whether ruling broadly on such basic questions would do “more harm than good.” She suggested that a narrow decision dealing with the category of nonprofit advocacy corporations like Citizens United might be more appropriate.
“Your honor,” said Abrams, “I don’t think you’d be doing more harm than good in vindicating the First Amendment rights here, which transcend that of Citizens United.”
Also making her debut at the podium was Solicitor General Elena Kagan, who argued against reversing precedents that have permitted government to stem corruption and protect shareholders from being misrepresented when their corporations join in election campaigns. Alito suggested there was no evidence for her corruption argument, noting that a majority of states allow independent expenditures by corporations without being overwhelmed by corruption. And Roberts called her shareholder-protection argument “extraordinarily paternalistic.”
With comments like these, and sharp questioning from Scalia and others, Kagan appeared almost reconciled to defeat. At one point, answering a question from Roberts, she said, “If you are asking me, Mr. Chief Justice, as to whether the government has a preference as to the way in which it loses, if it has to lose, the answer is yes.”
Government retreats on possible book bans
Kagan also retreated from a position the government took during the initial March arguments in the case. At that time, Deputy Solicitor General Malcolm Stewart had acknowledged under questioning that books funded by corporations could violate the ban on expenditures under some circumstances — an admission that appeared to shock some justices.
“The government’s answer has changed,” on whether the McCain-Feingold campaign-finance law would allow a book published by a corporation to be banned, Kagan said. She told the Court that the justices’ reaction caused her to re-examine the situation “very carefully,” and she said the part of the law at issue would not apply to books. Furthermore, she said, there had never been an FEC enforcement action against a book. Stewart was seated with Kagan at the counsel’s table.
Roberts reacted skeptically, stating that the protection of First Amendment rights should not be placed in the hands of “FEC bureaucrats.”
Justice Stephen Breyer, a defender of most campaign regulation, tried to fend off a regulatory defeat in some of his questioning. Striking down the ban on corporate spending while allowing other parts of McCain-Feingold to persist — including restrictions on political-party spending — would “make a hash” of campaign-finance law, he said. Breyer also asked Olson whether the Court should second-guess the determination of Congress that the restrictions on corporate campaign expenditures were necessary.
Olson quickly replied, “You must always second-guess Congress when the First Amendment is in play.”
Former solicitor general Seth Waxman was the final advocate, arguing on behalf of the congressional backers of the McCain-Feingold law. He urged the justices to proceed slowly and use another case, with a more fully developed record, to examine the momentous issues before the Court.