Thursday, January 21, 2010

Supreme Court Opinion In Citizens United - Austin Overruled, Eases Campaign Finance Rules, Upholds Disclosure Requirements

The United States Supreme Court released a 183 page opinion today in Citizens United v. Federal Election Commission (08-205).  The case was previously discussed on this blog HERE and HERE.  The SCOTUS Blog's post "Campaign disclosure rules upheld" can be viewed HERE.  Fox News has an article "Supreme Court Removes Limits on Corporate, Labor Donations to Campaigns" which can be viewed HERE.  The Atlantic has an article "Citizens United Decision: Bring On The Spending" which can be viewed HERE.  ABC News has an article "Supreme Court Overturns Campaign Spending Limits on Corporations, Unions" which can be viewed HERE.  Also: CNNPolitico; NewsHour; the Washington Post; and many more on Google News.    

The Court's syllabus is copied below and the entire opinion is below that:


1. Because the question whether §441b applies to Hillary cannot be resolved on other, narrower grounds without chilling political speech, this Court must consider the continuing effect of the speech suppres-sion upheld in Austin. Pp. 5–20.

(a) Citizen United’s narrower arguments—that Hillary is not an “electioneering communication” covered by §441b because it is not“publicly distributed” under 11 CFR §100.29(a)(2); that §441b maynot be applied to Hillary under Federal Election Comm’n v. Wisconsin Right to Life, Inc., 551 U. S. 449 (WRTL), which found §441b uncon-stitutional as applied to speech that was not “express advocacy or its functional equivalent,” id., at 481 (opinion of ROBERTS, C. J.), deter-mining that a communication “is the functional equivalent of express advocacy only if [it] is susceptible of no reasonable interpretationother than as an appeal to vote for or against a specific candidate,” id., at 469–470; that §441b should be invalidated as applied to movies shown through video-on-demand because this delivery system has alower risk of distorting the political process than do television ads;and that there should be an exception to §441b’s ban for nonprofitcorporate political speech funded overwhelming by individuals—arenot sustainable under a fair reading of the statute. Pp. 5–12.

(b) Thus, this case cannot be resolved on a narrower ground without chilling political speech, speech that is central to the First Amendment’s meaning and purpose. Citizens United did not waive this challenge to Austin when it stipulated to dismissing the facial challenge below, since (1) even if such a challenge could be waived, this Court may reconsider Austin and §441b’s facial validity here be-cause the District Court “passed upon” the issue, Lebron v. National Railroad Passenger Corporation, 513 U. S. 374, 379; (2) throughoutthe litigation, Citizens United has asserted a claim that the FEC hasviolated its right to free speech; and (3) the parties cannot enter intoa stipulation that prevents the Court from considering remedies nec-essary to resolve a claim that has been preserved. Because Citizen United’s narrower arguments are not sustainable, this Court must, in an exercise of its judicial responsibility, consider §441b’s facial valid-ity. Any other course would prolong the substantial, nationwide chilling effect caused by §441b’s corporate expenditure ban. This conclusion is further supported by the following: (1) the uncertaintycaused by the Government’s litigating position; (2) substantial timewould be required to clarify §441b’s application on the points raisedby the Government’s position in order to avoid any chilling effect caused by an improper interpretation; and (3) because speech itself is of primary importance to the integrity of the election process, anyspeech arguably within the reach of rules created for regulating po-litical speech is chilled. The regulatory scheme at issue may not be aprior restraint in the strict sense. However, given its complexity and the deference courts show to administrative determinations, a speaker wishing to avoid criminal liability threats and the heavycosts of defending against FEC enforcement must ask a governmen-tal agency for prior permission to speak. The restrictions thus func-tion as the equivalent of a prior restraint, giving the FEC poweranalogous to the type of government practices that the First Amend-ment was drawn to prohibit. The ongoing chill on speech makes itnecessary to invoke the earlier precedents that a statute that chills speech can and must be invalidated where its facial invalidity hasbeen demonstrated. Pp. 12–20.

2. Austin is overruled, and thus provides no basis for allowing the Government to limit corporate independent expenditures. Hence, §441b’s restrictions on such expenditures are invalid and cannot be applied to Hillary. Given this conclusion, the part of McConnell that upheld BCRA §203’s extension of §441b’s restrictions on independent corporate expenditures is also overruled. Pp. 20–51.

(a) Although the First Amendment provides that “Congress shallmake no law . . . abridging the freedom of speech,” §441b’s prohibitionon corporate independent expenditures is an outright ban on speech, backed by criminal sanctions. It is a ban notwithstanding the factthat a PAC created by a corporation can still speak, for a PAC is aseparate association from the corporation. Because speech is an es-sential mechanism of democracy—it is the means to hold officials ac-countable to the people—political speech must prevail against lawsthat would suppress it by design or inadvertence. Laws burdening such speech are subject to strict scrutiny, which requires the Gov-ernment to prove that the restriction “furthers a compelling interest and is narrowly tailored to achieve that interest.” WRTL, 551 U. S., at 464. This language provides a sufficient framework for protecting the interests in this case. Premised on mistrust of governmentalpower, the First Amendment stands against attempts to disfavor cer-tain subjects or viewpoints or to distinguish among different speak-ers, which may be a means to control content. The Government may also commit a constitutional wrong when by law it identifies certain preferred speakers. There is no basis for the proposition that, in thepolitical speech context, the Government may impose restrictions oncertain disfavored speakers. Both history and logic lead to this con-clusion. Pp. 20–25.

(b) The Court has recognized that the First Amendment appliesto corporations, e.g., First Nat. Bank of Boston v. Bellotti, 435 U. S. 765, 778, n. 14, and extended this protection to the context of politicalspeech, see, e.g., NAACP v. Button, 371 U. S. 415, 428–429. Address-ing challenges to the Federal Election Campaign Act of 1971, the Buckley Court upheld limits on direct contributions to candidates, 18 U.S.C. §608(b), recognizing a governmental interest in preventing quid pro quo corruption. 424 U. S., at 25–26. However, the Court in-validated §608(e)’s expenditure ban, which applied to individuals,corporations, and unions, because it “fail[ed] to serve any substantialgovernmental interest in stemming the reality or appearance of cor-ruption in the electoral process,” id., at 47–48. While Buckley did not consider a separate ban on corporate and union independent expendi-tures found in §610, had that provision been challenged in Buckley’s wake, it could not have been squared with the precedent’s reasoning and analysis. The Buckley Court did not invoke the overbreadth doc-trine to suggest that §608(e)’s expenditure ban would have been con-stitutional had it applied to corporations and unions but not indi-viduals. Notwithstanding this precedent, Congress soon recodified §610’s corporate and union expenditure ban at 2 U. S. C. §441b, the provision at issue. Less than two years after Buckley, Bellotti reaffirmed the First Amendment principle that the Government lacks thepower to restrict political speech based on the speaker’s corporate identity. 435 U.S., at 784–785. Thus the law stood until Austin up-held a corporate independent expenditure restriction, bypassing Buckley and Bellotti by recognizing a new governmental interest inpreventing “the corrosive and distorting effects of immense aggrega-tions of [corporate] wealth . . . that have little or no correlation to thepublic’s support for the corporation’s political ideas.” 494 U. S., at 660. Pp. 25–32.

(c) This Court is confronted with conflicting lines of precedent: a pre-Austin line forbidding speech restrictions based on the speaker’s corporate identity and a post-Austin line permitting them. Neither Austin’s antidistortion rationale nor the Government’s other justifica-tions support §441b’s restrictions. Pp. 32–47.

(1) The First Amendment prohibits Congress from fining or jailing citizens, or associations of citizens, for engaging in politicalspeech, but Austin’s antidistortion rationale would permit the Government to ban political speech because the speaker is an associationwith a corporate form. Political speech is “indispensable to decision-making in a democracy, and this is no less true because the speechcomes from a corporation.” Bellotti, supra, at 777 (footnote omitted). This protection is inconsistent with Austin’s rationale, which is meant to prevent corporations from obtaining “ ‘an unfair advantage in the political marketplace’ ” by using “ ‘resources amassed in the economic marketplace.’ ” 494 U. S., at 659. First Amendment protec-tions do not depend on the speaker’s “financial ability to engage in public discussion.” Buckley, supra, at 49. These conclusions were re-affirmed when the Court invalidated a BCRA provision that in-creased the cap on contributions to one candidate if the opponent made certain expenditures from personal funds. Davis v. Federal Election Comm’n, 554 U. S. ___, ___. Distinguishing wealthy indi-viduals from corporations based on the latter’s special advantages of, e.g., limited liability, does not suffice to allow laws prohibiting speech. It is irrelevant for First Amendment purposes that corporate funds may “have little or no correlation to the public’s support for the corporation’s political ideas.” Austin, supra, at 660. All speakers, including individuals and the media, use money amassed from the eco-nomic marketplace to fund their speech, and the First Amendment protects the resulting speech. Under the antidistortion rationale, Congress could also ban political speech of media corporations. Al-though currently exempt from §441b, they accumulate wealth withthe help of their corporate form, may have aggregations of wealth,and may express views “hav[ing] little or no correlation to the public’s support” for those views. Differential treatment of media corpora-tions and other corporations cannot be squared with the First Amendment, and there is no support for the view that the Amend-ment’s original meaning would permit suppressing media corpora-tions’ political speech. Austin interferes with the “open marketplace”of ideas protected by the First Amendment. New York State Bd. of Elections v. Lopez Torres, 552 U. S. 196, 208. Its censorship is vast inits reach, suppressing the speech of both for-profit and nonprofit,both small and large, corporations. Pp. 32–40.

(2) This reasoning also shows the invalidity of the Government’s other arguments. It reasons that corporate political speechcan be banned to prevent corruption or its appearance. The Buckley Court found this rationale “sufficiently important” to allow contribu-tion limits but refused to extend that reasoning to expenditure limits,424 U.S., at 25, and the Court does not do so here. While a single Bellotti footnote purported to leave the question open, 435 U. S., at788, n. 26, this Court now concludes that independent expenditures, including those made by corporations, do not give rise to corruption or the appearance of corruption. That speakers may have influence over or access to elected officials does not mean that those officials are corrupt. And the appearance of influence or access will not causethe electorate to lose faith in this democracy. Caperton v. A. T. Massey Coal Co., 556 U. S. ___, distinguished. Pp. 40–45.

(3) The Government’s asserted interest in protecting share-holders from being compelled to fund corporate speech, like the anti-distortion rationale, would allow the Government to ban political speech even of media corporations. The statute is underinclusive; it only protects a dissenting shareholder’s interests in certain media for 30 or 60 days before an election when such interests would be implicated in any media at any time. It is also overinclusive because it covers all corporations, including those with one shareholder. P. 46.

(4) Because §441b is not limited to corporations or associations created in foreign countries or funded predominately by foreign shareholders, it would be overbroad even if the Court were to recognize a compelling governmental interest in limiting foreign influence over the Nation’s political process. Pp. 46–47.

(d) The relevant factors in deciding whether to adhere to stare decisis, beyond workability—the precedent’s antiquity, the reliance interests at stake, and whether the decision was well reasoned— counsel in favor of abandoning Austin, which itself contravened the precedents of Buckley and Bellotti. As already explained, Austin was not well reasoned. It is also undermined by experience since its announcement. Political speech is so ingrained in this country’s culture that speakers find ways around campaign finance laws. Rapid changes in technology—and the creative dynamic inherent in the concept of free expression—counsel against upholding a law that re-stricts political speech in certain media or by certain speakers. In addition, no serious reliance issues are at stake. Thus, due consid-eration leads to the conclusion that Austin should be overruled. The Court returns to the principle established in Buckley and Bellotti that the Government may not suppress political speech based on the speaker’s corporate identity. No sufficient governmental interest justifies limits on the political speech of nonprofit or for-profit corpora-tions. Pp. 47–50.

3. BCRA §§201 and 311 are valid as applied to the ads for Hillaryand to the movie itself. Pp. 50–57.

(a) Disclaimer and disclosure requirements may burden the abil-ity to speak, but they “impose no ceiling on campaign-related activi-ties,” Buckley, 424 U. S., at 64, or “ ‘ “prevent anyone from speak-ing,” ’ ” McConnell, supra, at 201. The Buckley Court explained that disclosure can be justified by a governmental interest in providing “the electorate with information” about election-related spending sources. The McConnell Court applied this interest in rejecting facialchallenges to §§201 and 311. 540 U. S., at 196. However, the Court acknowledged that as-applied challenges would be available if agroup could show a “ ‘reasonable probability’ ” that disclosing its con-tributors’ names would “ ‘subject them to threats, harassment, or re-prisals from either Government officials or private parties.’ ” Id., at 198. Pp. 50–52.

(b) The disclaimer and disclosure requirements are valid as ap-plied to Citizens United’s ads. They fall within BCRA’s “electioneer-ing communication” definition: They referred to then-Senator Clintonby name shortly before a primary and contained pejorative references to her candidacy. Section 311 disclaimers provide information to the electorate, McConnell, supra, at 196, and “insure that the voters are fully informed” about who is speaking, Buckley, supra, at 76. At the very least, they avoid confusion by making clear that the ads are not funded by a candidate or political party. Citizens United’s arguments that §311 is underinclusive because it requires disclaimers for broad-cast advertisements but not for print or Internet advertising and that §311 decreases the quantity and effectiveness of the group’s speech were rejected in McConnell. This Court also rejects their contention that §201’s disclosure requirements must be confined to speech thatis the functional equivalent of express advocacy under WRTL’s test for restrictions on independent expenditures, 551 U.S., at 469–476(opinion of ROBERTS, C.J.). Disclosure is the less-restrictive alterna-tive to more comprehensive speech regulations. Such requirements have been upheld in Buckley and McConnell. Citizens United’s ar-gument that no informational interest justifies applying §201 to itsads is similar to the argument this Court rejected with regard to dis-claimers. Citizens United finally claims that disclosure requirementscan chill donations by exposing donors to retaliation, but offers noevidence that its members face the type of threats, harassment, orreprisals that might make §201 unconstitutional as applied. Pp. 52–55.

(c) For these same reasons, this Court affirms the application ofthe §§201 and 311 disclaimer and disclosure requirements to Hillary. Pp. 55–56.

Reversed in part, affirmed in part, and remanded.

KENNEDY, J., delivered the opinion of the Court, in which ROBERTS, C. J., and SCALIA and ALITO, JJ., joined, in which THOMAS, J., joined as to all but Part IV, and in which STEVENS, GINSBURG, BREYER, and SO-TOMAYOR, JJ., joined as to Part IV. ROBERTS, C. J., filed a concurring opinion, in which ALITO, J., joined. SCALIA, J., filed a concurring opin-ion, in which ALITO, J., joined, and in which THOMAS, J., joined in part. STEVENS, J., filed an opinion concurring in part and dissenting in part,in which GINSBURG, BREYER, and SOTOMAYOR, JJ., joined. THOMAS, J., filed an opinion concurring in part and dissenting in part.  


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