Citizens United v. Federal Election Commission

Following is the case brief for Citizens United v. Federal Election Commission, United States Supreme Court, (2010)

Case Summary of Citizens United v. Federal Election Commission:

  • Citizens United (non-profit) produced a negative ad regarding then-Senator Hillary Clinton raising concerns under the Bipartisan Campaign Reform Act (the Act).
  • Citizens United challenged the section 441(b) of the Act in District Court, requesting an injunction, which the court denied.
  • Citizens United then appealed to the Supreme Court who held that the prohibition on “express advocacy” by a corporation was unconstitutional under the First Amendment right to free speech.

Case Brief

Statement of the Facts:

Citizens United is a nonprofit corporation that primarily accepts funds from private donations. A small portion of its funding comes from for-profit corporations. Citizens United produced a documentary film that was essentially a negative ad. It urged viewers to vote against Hillary Clinton in the 2008 Democratic primaries. Citizens United released the film and began running advertisements regarding the future release video on demand. Both the film and advertisements raised concerns under section 441(b) of the Act of 2002 and was categorized as “express advocacy” by Citizens United.  Under the above section, it is a felony for all corporations either to expressly advocate the election or defeat of candidates or to broadcast electioneering communications within thirty days of a primary election or sixty days of a general election. The section states an exception for Political Action Committees (PAC) and permits the political speech of these groups, even when formed by corporations.

Citizens United challenged the constitutionality of the provision in federal District Court against the Federal Election Commission claiming the section was an unconstitutional restriction for corporations of freedom of speech.

Procedural History:

Citizens United sought an injunction in District Court. The court denied the injunction and Citizens United appealed to the United States Supreme Court.

Issue and Holding:

Does the section 441(b) prohibition on express advocacy by corporations with a specific period of time before an election violate the First Amendment right of freedom of speech? Yes.

Rule of Law or Legal Principle Applied:

The government may not suppress political speech on the basis of the speaker’s corporate identity under the First Amendment.

Judgment:

Reversed, section 441(b)’s prohibition on “express advocacy” was unconstitutional.

Reasoning:

The Act’s exception in section 441 is a result of the fact that a PAC is considered a complete and separate association from a corporation. In addition, several corporations do not create PACs as they are costly to administer and subject to regulation. As a result, permitting a corporation to politically speak under the guise of a PAC does not fulfill the First Amendment requirement of freedom of speech for corporations.

The Court states the issue at hand is similar to prior decisions made in Buckley v. Valeo, 424 U.S. 1 (1976), and Bellotti v. Baird, 443 U.S. 622 (1979). Both cases suggest that the First Amendment does not permit political speech restrictions based on a speaker’s corporate identity, however, the decision in Austin v. Michigan Chamber of Commerce, 494 U.S. 652 (1990), overruled this precedent. There the Court held that the government has a compelling governmental interest regarding “the corrosive and distortive effects of immense aggregations of wealth” accumulated by corporations and funneled into the political process. The rationale of “distortion” previously led the Court to decide the First Amendment does not protect political speech by corporations.

The Court holds the rationale of the Austin Court to be unsound due to the fact it is overly broad. Included are millions of corporations that do not possess large “aggregation of wealth” in addition to media corporations which are excluded from the Act’s ban on political speech. As a result, the FEC’s reliance on Austin in its argument against corporate political speech is rejected.

The government’s interest in preventing corruption does not outweigh the corporation’s interest in free speech. In addition, there is no factual showing that corporate speech promotes corruption. In consideration, the FEC’s argument that corporate political speech should be banned to prevent corruption or the appearance of corruption is rejected.

Lastly, the FEC’s argument that corporate political speech should be limited for the purpose of protecting dissenting shareholders who do not wish to fund political speech is rejected. This is due to the fact dissenting shareholders have alternative sufficient avenues for redress. Such as interest does not justify a blanket denial of political speech for corporations.

For the reasons stated above in addition to the principles of stare decisis, the Court overruled its Austin decision and the principle in Buckley and Bellotti that government may not suppress political speech on the basis of the speaker’s corporate identity is reinstated.

Concurring and Dissenting opinions:

Concurring (Scalia):

The First Amendment of the Constitution protects corporate speech. The dissent is incorrect in concluding that the framers of the Constitution did not like corporations and should now have no right to political speech.  Any indication of the Framers’ resentment toward corporations was directed at the state-granted monopoly privileges enjoyed by individual corporations. Modern corporations do not resemble the corporations that existed during that time. Also, individuals do not lose free speech rights when they choose to associate themselves within a business.

Dissenting (Stevens):

The majority misreads the opinion in Austin as advocating a “categorical ban” on all corporate political speech. In the context of a public election, there is a substantial difference between corporate and human speakers. Corporate spending can skew the democratic process when large amounts of money are contributed to candidates who support the interests of corporations over individuals. The majority’s decision is inconsistent with the past, particularly from the way corporations were viewed by the framers. Historically, Congress has put a limit on corporate spending. That should not change and the majority ignores the principle that in a democracy there is a need to limit such spending to preserve the rights of individuals.

Significance:

The Court established that the First Amendment right to free speech extends to corporations just as it does to individuals. As a result, preventing a corporation (even a non-profit) from participating in “express advocacy” is unconstitutional.

Student Resources:

https://www.law.cornell.edu/supct/html/08-205.ZX.html
http://caselaw.findlaw.com/us-supreme-court/08-205.html

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