Citizens United v. Federal Election Commission | Study Guide

U.S. Supreme Court

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Citizens United v. Federal Election Commission | Summary & Analysis

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Summary

Background to the Case

In 2002 Congress enacted the Bipartisan Campaign Reform Act (BCRA). The law amended Section 441b of the Federal Election Campaign Act (FECA) of 1971, to prohibit corporations and unions from using general treasury funds to pay for an "electioneering communication"—a public communication urging the victory or defeat of a particular candidate within 60 days before a general election or 30 days before a primary election. The BCRA did not put any limits on spending by political action committees (PACs), organizations that raise money in support of particular candidates or ballot issues.

Additionally, Section 201 of the BCRA required organizations that pay for election-related messages to disclose their identities. Section 311 required a disclaimer on advertisements not authorized by the candidate they intended to support.

Citizens United, a nonprofit corporation, wanted to air a documentary critical of Hillary Clinton, who was seeking the Democratic Party's nomination for president in 2008. It sued to prevent the Federal Election Commission (FEC) from blocking its documentary. It also argued against the BCRA's disclosure and disclaimer requirements. The federal district court for Washington, DC, ruled against the organization. Citizens United then appealed to the U.S. Supreme Court.

In its appeal, Citizens United argued against the law on an "as-applied" basis. The corporation claimed the law should not apply to its situation because the documentary was to be shown via video-on-demand, meaning it did not fit the law's definition of electioneering communications as "publicly distributed." Citizens United also pointed out that the documentary did not explicitly urge voters to vote against Clinton. Furthermore, Citizens United said the law did not apply to it since it was a nonprofit rather than a for-profit corporation.

Reconsidering Austin and McConnell

Earlier Supreme Court rulings could have been used by the Federal Election Commission—which oversees federal campaign finance law—to ban the Citizens United documentary and ads promoting it from airing close to the election. In Austin v. Michigan Chamber of Commerce (1990), the court upheld a Michigan state law banning corporations from spending general treasury funds to support a political candidate. In McConnell v. FEC (2003), the court relied on the Austin ruling to uphold the BCRA ban on corporate and union use of general funds for campaign spending.

Citizens United had originally asked that the court rule that BCRA restrictions did not apply to its film and ads. In June 2009, the Supreme Court asked the parties in the Citizens United case to file briefs on a broader question: should the court overrule Austin and/or relevant parts of McConnell as being contrary to the 1st Amendment guarantee of free speech?

Ruling: Review of Facts and Relevant Laws

Justice Anthony Kennedy (b. 1936) wrote the 5–4 majority decision in Citizens United. In Part I, he reviews the facts of the case and the relevant laws.

  • Citizens United is a nonprofit corporation with an annual budget of around $12 million.
  • In 2008 it produced a film about Hillary Clinton, a presidential candidate.
  • The film was quite critical of Clinton.
  • The film was shown in theaters and released on DVD.
  • Citizens United also wanted to make the film available through video-on-demand, free of charge.
  • It wanted to do so within 30 days of the presidential primary elections in 2008.
  • Citizens United also produced three ads for the film, each including a negative portrayal of Clinton. It wanted to air the ads during the prohibited time period.

Kennedy notes that even before passage of the BCRA, federal law did not allow corporations and unions to use general funds to contribute directly to political candidates. He also points out that federal law does provide a way for corporations and unions to make direct contributions and to advocate for or against a candidate. They can do so by creating a PAC to raise and spend separate, specific funds for those purposes.

Ruling: Does BCRA's Spending Ban Apply to Hillary?

In Part II, Kennedy considers whether the case can be resolved on narrow grounds, rather than by considering whether to overturn earlier rulings in similar cases. Narrow grounds means that a ruling has a limited impact, applying to the situation at issue in a case. Citizens United argued that the BCRA law should not apply to its film and ads—a narrow argument.

Considering the case on narrow grounds, Kennedy dismisses Citizens United's claims. He notes several reasons why the BCRA applies to Hillary.

  • The fact that Citizens United sought to use an on-demand video service—a platform that might limit the reach of the film— does not impact whether the BCRA law applies. While the documentary would be seen only by those who chose to watch it on demand, it is still publicly distributed.
  • The court should not make a free speech ruling based on the particular type of media or technology used to distribute the speech (such as on-demand video).
  • Though the documentary does not explicitly advocate voting against Clinton, it clearly opposes her. This makes it "equivalent to express advocacy" against her.
  • Even though Citizens United is a nonprofit rather than a for-profit organization, the law does apply.

Ruling: Choosing to Consider Constitutionality

Kennedy concludes that the court cannot resolve the Citizens United case on narrow grounds without "chilling"—limiting or suppressing—political speech. Therefore, the court must go on to consider whether to overturn Austin, a case that allowed some suppression of election-related speech. Austin upheld a Michigan state law banning corporations from spending general funds to support or oppose candidates. Later, McConnell v. FEC (2003) heard a first challenge to the BCRA. McConnell referred to the Austin ruling to uphold the BCRA ban on corporate and union use of general funds for campaign spending. The Citizens United ruling reconsiders these earlier decisions. The court goes on to overturn Austin and parts of McConnell.

Ruling: Importance of First Amendment Issues

Kennedy argues that though the BCRA law does apply to Citizens United and its film and advertisements, a 1st Amendment challenge is a serious matter. Thus, the court has a responsibility to examine whether the law is unconstitutional. He notes that the district court could not rule on this issue because of the Supreme Court's ruling in McConnell. However, the Supreme Court can reconsider its own earlier decisions.

He explains that given the complexity of FEC regulations, in order to engage in election-related speech without risking criminal liability and heavy fines, the speaker must seek FEC approval of that speech prior to making it. This constitutes an "onerous" burden—a heavy restriction—that can limit or suppress speech.

Ruling: Corporate Free Speech and PACs

In Part III of his opinion, Kennedy declares that the BCRA's provisions ban corporate free speech. The option of creating a political action committee (PAC) to raise and spend money for supporting or opposing candidates does not eliminate this problem, he says. Creating a PAC is complicated. Moreover, PACs are highly regulated, which can discourage a corporation from creating one.

Kennedy stresses that political speech is central to democratic government. He argues that any ban on the speech of an individual would be disallowed on 1st Amendment grounds. This lays the ground for the majority's argument that corporations must also enjoy those same free speech rights.

Ruling: Government's Arguments in Favor of BCRA

In Part III-B Kennedy addresses the government's arguments in favor of the BCRA. First, in Part III-B.1, he takes on the issue of distortion. The court based its Austin ruling on an "antidistortion interest"—the government interest in blocking corporations from using their wealth to distort (change or significantly impact) the political landscape. The government makes little use of that argument in this case, he writes. But Kennedy then goes on to dismantle that argument. First, he says, the argument goes against 1st Amendment principles. Furthermore, the Austin rationale could be used to ban speech by media corporations, which Kennedy says is unacceptable.

In Part III-B.2 Kennedy discusses how the government supports the ban on corporate speech on the grounds of preventing corruption or the appearance of corruption. In Buckley v. Valeo (1976), he writes, the court found this a sound reason to allow contribution limits but not spending limits. The majority, he says, ruled that independent expenditures, even by corporations, do not give rise to corruption or the appearance of corruption.

In Part III-B.3 Kennedy addresses the government's argument that the law protects corporate shareholders from being forced to fund speech with which they disagree. Kennedy says that the BCRA provides poor protection since it bars speech by the corporation only within certain time periods. Furthermore, he says, the law is too broad since it covers all corporations, even if they have only one shareholder.

In Part III-B.4, Kennedy says the government interest in banning foreign influence on campaigns is not relevant since the law blocks speech by all corporations.

Ruling: Overturning Election Spending Bans

In Part III-C, Kennedy addresses the principle of honoring precedent, or following stare decisis ("to stand by that which is decided"). This is a principle, not a rule, Kennedy writes. The principle is based on three factors: how old the precedent is, how much the precedent is relied on, and how well reasoned that precedent is.

Kennedy argues that all three factors support abandoning Austin. Therefore, Austin's ban on independent expenditures by corporations is overruled. The court rules that the government may not block political speech by corporations. In Part III-D, Kennedy says the relevant part of the McConnell decision is also overruled.

Ruling: Upholding Disclosure and Disclaimer Requirements

In Part IV, Kennedy upholds the disclosure and disclaimer requirements in Sections 201 and 311 of the BCRA. These provisions require that public communications related to candidates and political issues include a clear statement that indicates who paid to produce the communication and whether a candidate has authorized it.

Roberts's Concurrence in Citizens United

Chief Justice John Roberts (b.1955) wrote a concurring opinion—one that agrees with the majority ruling. Justice Samuel Alito (b. 1950) joined Roberts's concurrence. Roberts begins by strongly stating his belief that the BCRA unconstitutionally restricts 1st Amendment rights.

In Part I, Roberts applauds how Kennedy's carefully constructed opinion first addresses the case on narrow grounds before taking on the constitutional issues. He also dismisses Justice Stevens's dissent. Roberts disagrees with Stevens's argument that the court should avoid making a broader ruling on constitutionality and focus on the narrower issue of whether the BCRA applies to Citizens United's documentary and ads.

In Part II, Roberts rejects Stevens's argument that other decisions had upheld Austin. Roberts says McConnell did not address the constitutionality of Austin and, thus, did not uphold it. Furthermore, he notes that Austin departed from earlier decisions, which suggests it was wrongly reasoned.

Roberts then discusses the government's arguments for the BCRA, finding them flawed. He notes that the government offers new arguments that were not the basis of the court's decision in Austin. This is inconsistent with the principle of stare decisis, he states. They might be good arguments, but they cannot claim the authority of precedent if they are new and do not rely on the original decision.

Scalia's Concurrence in Citizens United

Justice Antonin Scalia (1936–2016) also wrote a concurring opinion joined by Justice Alito and, in part, by Justice Clarence Thomas (b. 1948). Scalia focuses on Stevens's dissent, particularly the section "Original Understandings." He argues that Stevens is wrong in claiming that the original meaning of the 1st Amendment does not apply to corporations. He also says that Stevens incorrectly interprets how the Framers—the original writers of the Constitution—viewed corruption. Fundamentally, Scalia says, Stevens is incorrect in limiting the application of the 1st Amendment to individuals acting alone and not to individuals acting in association with other individuals.

Stevens's Partial Dissent: Corporations Are Not People

Justice John Paul Stevens wrote an opinion concurring in part and dissenting in part with the majority. He was joined by the liberal Justices Ruth Bader Ginsburg (b.1933), Stephen Breyer (b.1938), and Sonia Sotomayor (b.1954).

Stevens opens his lengthy opinion by sweeping aside the free speech focus of the majority decision. The "real issue," he writes, "concerns how, not if," Citizens United can fund the showing of Hillary: The Movie. If it had used its PAC, it would not have broken the law, and there would be no case. He calls the majority misguided for finding that Citizens United has 1st Amendment grounds to dispute the law.

Stevens charges that the majority bases its ruling on the incorrect premise that the 1st Amendment prohibits making any distinctions about the identity of a speaker, including when the "speaker" is a corporation. The notion that a corporation is identical to a real, human person is simply inaccurate, Stevens argues. Indeed, in the context of elections "the distinction between corporate and human speakers is significant."

Congress has sound reasons for wishing to regulate corporate political speech, he says. First, corporations can be owned by foreigners. Second, their wealth, basic structure, and purpose are all reasons to regulate aspects of how they engage in political speech. Indeed, lawmakers may have a "democratic duty" to regulate corporate electioneering, he writes.

Stevens charges that in overturning Austin the majority ignores "a century of history" during which corporate and individual spending on political campaigns have been seen as different. He adds that in basing its rulings on dissents in both Austin and McConnell, the majority ignores several earlier court decisions on campaign-related speech. Finally, he suggests that the majority violates legal principles in overturning precedents set in those earlier decisions. He states his concurrence with the majority in upholding the disclosure requirement. However, he concludes his introduction to his opinion by stating: "I emphatically dissent from its principal holding."

Stevens's Partial Dissent: Rejecting the Majority's Arguments

In Part I of his dissent Stevens criticizes the majority for overturning the Austin and McConnell precedents. The majority should never have declared the provisions of the BCRA unconstitutional, he says. That question was not raised by Citizens United itself in its appeal to the Supreme Court. Rather, the Supreme Court raised the issue by asking the parties in the case for additional arguments. That step itself, he asserts, violated court precedent. He cites earlier decisions that support the idea of interpreting constitutionality on narrow grounds. Furthermore, he adds, the majority could have used those narrow grounds to rule in favor of Citizens United but keep the law intact.

In Part II, Stevens admonishes the majority for rejecting stare decisis. He objects to the majority's assertion that Austin was poorly reasoned. He also rejects the claim that the decision has been "undermined by experience." The case record for Citizens United shows no evidence of faultiness in Austin, nor does the majority provide any, he says. In considering whether to overturn precedent, Stevens notes, the court has traditionally applied three tests. Those are "the antiquity of the precedent, the workability of its legal rule, and the reliance interests at stake." He provides detailed analysis, arguing that the law should be upheld on all three grounds.

In Part III, Stevens attacks the rationale of the majority. He repeats his argument from the introduction that corporations can get involved in elections through their PACs. They can also carry out electioneering in time periods outside the 30-day and 60-day limits set in the law. Second, the majority is wrong in asserting that the government cannot restrict speech on the basis of the identity of the speaker. Third, he rejects the majority's assertion that Austin and McConnell were "aberration[s]" in 1st Amendment decisions. He bases this analysis on several points:

  • The Framers would not have seen the 1st Amendment as applying to corporations.
  • Congress has, since 1907, regulated corporate involvement in political campaigns, and the courts have upheld these restrictions.
  • Buckley did not address campaign spending, and First National Bank of Boston v. Bellotti (1978) included a statement accepting limits on corporate campaign spending.

In Part IV, Stevens explains why the government might justifiably want to limit corporate campaign spending. First, he says, Congress has a legitimate interest in preventing the corrupting influence of corporate money on elections. Second, the majority is wrong in arguing that only quid pro quo agreements (giving something in exchange for something in return) between candidates and campaign donors constitute corruption. Third, the majority does not show sufficient deference to the legitimate actions of Congress, an equal branch of the government. Fourth, in Austin the court accepted limits on corporate campaign spending on antidistortion grounds. The Austin court also saw the value of limiting corporate spending to protect the interests of shareholders who might disagree with the views the corporation promotes.

In Part V, Stevens uses stinging language to summarize his argument and rebuke the majority. He stresses that the majority mischaracterizes the law, the issues in the case, and prior court decisions. Thus, he argues, the majority violates basic principles of judicial decision-making.

Thomas's Partial Dissent in Citizens United

Justice Clarence Thomas wrote an opinion dissenting with the majority's acceptance of the disclosure provision in the BCRA (Part IV of Kennedy's decision). The majority does not go far enough, he asserts. Thomas flatly states that the Constitution does not permit abridging the "right to anonymous speech." He cites events in 2008, when some individuals who supported a California ballot referendum were forced by state law to disclose their identity and were harassed by opponents of the measure. By protecting anonymous speech, he writes, the courts can better protect freedom of speech.

Analysis

Kennedy and Stevens in Citizens United

Justice Kennedy was a staunch opponent of campaign finance laws that, to his mind, put unconstitutional limits on free speech. He had dissented in both the Austin and McConnell cases that were overturned by Citizens United. In 2008 he had sided with the court majority in striking down another provision of the BCRA in Davis v. Federal Election Commission. Thus, his views in the Citizens United case did not come as a surprise.

After the Citizens United decision, reports surfaced indicating some behind-the-scenes maneuvering involving Kennedy and Chief Justice Roberts. According to the reports, after the case was first heard, the conservative majority voted that the law did not apply to the movie and that the FEC should not have blocked it. Roberts assigned himself the majority opinion and wrote it based on those narrow grounds. At the same time, Kennedy wrote a concurring opinion arguing that the court should have addressed whether the law itself was constitutional. Other conservatives favored Kennedy's view. This prompted Roberts to call for the parties to reargue the case on that broader issue. After those arguments, he assigned the majority opinion to Kennedy.

Justice Stevens, in contrast, generally supported campaign finance laws. He sided with the majority in Austin and McConnell, a decision that he co-authored. Interestingly, his opinion in Citizens United—at more than 22,000 words long, not counting the footnotes—is nearly a third longer than Kennedy's majority opinion. That discrepancy suggests the depth of his disagreement with the majority. Stevens retired in 2010, some months after the Citizens United decision.

Narrow or Broad Application in Citizens United

The competing opinions in Citizens United focused on three key issues. The first was the controversy over narrow or broad application of the law. Justice Kennedy analyzes the case first on narrow grounds and finds that the FEC would be justified in applying the law on all those grounds.

Justice Stevens argues that the majority should have stopped there. In his view, that settled the case and all that remained was the matter of the disclosure and disclaimer provisions, requiring that political ads and other election communications clearly state who has paid for them and whether they are authorized by a candidate.

The majority justifies its decision on the grounds that allowing the FEC to block the documentary—or campaign speech like it—would have the effect of "chilling political speech." Since political speech is the core of what the 1st Amendment is meant to protect, the majority ruled that such prohibitions cannot be allowed.

In Stevens's view, if the majority wanted to prevent the FEC from chilling speech, it should have struck the law down on the narrow "as-applied" grounds. Instead, the majority "operates with a sledge hammer rather than a scalpel." He cites an opinion by the chief justice in a 2004 case, in which Roberts wrote, "[I]f it is not necessary to decide more, it is necessary not to decide more." In other words, a guiding principle of the court is to stick to narrow grounds if possible.

Roberts, in his concurrence, rejects Stevens's position. He says the court has a responsibility to go deeper. As he writes, "we cannot embrace a narrow ground of decision simply because it is narrow; it must also be right." He then acknowledges Stevens's citation of his 2004 decision but parries with a simple statement: "sometimes it is necessary to decide more."

Corporate Personhood in Citizens United

A key dispute at the heart of Citizens United is the question of corporate personhood. A long legal tradition treats corporations as people to some extent. For instance, they have the right to enter into contracts, own property, and be either the defendant or plaintiff in a lawsuit. A Supreme Court decision in the 1880s extended 14th Amendment protections to corporations. (Among other provisions, the 14th Amendment established that government may not "deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws.")

As Justice Kennedy points out in Section III-A of the majority opinion, the court has some history of decisions recognizing 1st Amendment protections for corporations. The majority argues that, since corporations are sometimes treated like persons in the eyes of the law, they must enjoy the same protections as citizens. Kennedy argues that the Constitution does not permit having "certain preferred speakers"—that is, it does not privilege citizen speakers over corporate speakers. Roberts, in his concurrence, takes a similar position. "Congress violates the First Amendment," he writes, "when it decrees that some speakers may not engage in political speech."

Stevens strongly objects to this black-and-white view of corporate personhood. "In the context of election to public office, the distinction between corporate and human speakers is significant," he writes. Given corporations' wealth and structure—and the fact that they can be controlled by non-American interests—Congress has every reason to regulate their involvement in elections. Stevens wryly observes that "Under the majority's view, I suppose it may be a First Amendment problem that corporations are not permitted to vote, given that voting is, among other things, a form of speech." In summing up, Stevens concludes by noting that "American democracy is imperfect" before making another wry observation: "few outside the majority of this Court would have thought its flaws included a dearth of corporate money in politics."

Precedent in Citizens United

Another major issue considered by the justices in this case is the role of stare decisis, or adherence to precedent. The court often chooses to rule in accordance with rulings made in the past. Departing from precedent is seen as a choice that usually requires extremely solid and important reasons.

Kennedy had long been opposed to campaign finance laws. He was thus inclined to overturn precedent. In supporting his decision to overturn the relevant section of the BCRA (in Part III), Kennedy frequently cites dissents filed in earlier decisions. He himself joined in several of those dissents. His reliance on dissents—rather than on majority rulings—prompts one of Stevens's objections in Part V of his dissent. The majority, he claims, emphasizes "individual dissenting opinions over precedential holdings." Yet by virtue of his own dissent, Stevens indicates that dissenting opinions ought sometimes to be considered.

One basis of the disagreement is the justices' view of Austin as precedent. To Kennedy, Austin was an aberration. Citing his own dissent in Austin, Kennedy writes that Austin upheld "a direct restriction on the independent expenditure of funds for political speech for the first time in [this Court's] history." Stevens disagrees. "State legislatures," he writes, "have relied on their authority to regulate corporate electioneering, confirmed in Austin, for more than a century." This point addresses two key features of stare decisis. Traditionally, the courts uphold precedent when that precedent is well established ("more than a century") and has a history of reliance.

Roberts's response is that the court has a tradition of rejecting precedent that was wrongly decided. If the court had not acted to overturn precedent, he writes, "segregation would be legal, minimum wage laws would be unconstitutional, and the Government could wiretap ordinary criminal suspects without first obtaining warrants." The chief justice chooses his overturned precedents carefully—they are all cases that he expects Stevens and the other liberal dissenters to agree with.

Impact of the Citizens United Decision

The Citizens United decision was generally hailed by conservatives and protested by liberals. Writing in the conservative New York Post, law professor Allison Hayward said the decision resolved a basic contradiction over 1st Amendment law. "How is it that the First Amendment protects obscene speech, nude dancing and talk radio," she wrote, "but permits Congress to shut down independent political messages from corporations and labor unions?" However, President Barack Obama, in his 2010 State of the Union message, complained that the decision would "open the floodgates of special interests—including foreign corporations—to spend without limit in our elections."

Since the Citizens United ruling, election spending has increased. One source of spending is Super PACs, which can accept unlimited contributions from corporations and unions. (Regular PACs can receive large donations from individuals, but cannot accept funds from corporate and union general funds.) Another source of spending is "dark money" groups. These are organizations that identify themselves as "social welfare organizations." They can accept unlimited contributions from any source. Many commentators point out that often these organizations are not truly invested in promoting or increasing the overall welfare of society. They have a particular set of political goals, but register as a "social welfare organization" for the purpose of funding election-related activities. Under Internal Revenue Service rules, these groups do not need to publicly identify their donors—hence the donations are made "in the dark."

In 2018, organizations spent heavily on elections, with Super PAC spending totaling more than $822 million. While these groups are supposed to act independently of either candidates or parties, some Super PACs are formed by party leaders. Many people and political groups remain concerned by the amount of money spent on elections. They note that the importance of having access to massive funding can eliminate many candidates and issues from consideration, because the public is unlikely to hear messages that are not backed by well-funded groups or individuals. Others argue that the Citizens United ruling simply allows people to contribute to groups that will work to spread the political messages they support, thereby promoting the principle of freedom of expression.

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