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https://www.brennancenter.org/our-work/analysis-opinion/how-big-business-bailed-out-nazis
How Big Business Bailed Out the Nazis
A tragic tale of what can go wrong when profits are entangled with politics.
Ciara Torres Spelliscy
The views expressed are the author’s own and not necessarily those of the Brennan Center for Justice.
Considering the outcome of this year’s presidential primaries, where the best-financed candidates were defeated, I’ve been asked repeatedly whether corporate money in politics really matters. And I’ll grant, corporate money so far mostly gone to losing candidates. But history may give us some greater perspective on how corporate money in politics can prove decisive.
It’s a largely forgotten piece of history, but in 1932 the German Nazi Party was facing financial ruin. How did the Nazis move from being broke to being in control of the German government just a year later? The Nazi Party was bailed out by German industrialists in early 1933.
The industrialists who led the way were two huge German firms, I.G. Farben and Krupp. Leaders of both of companies were among the few civilians who were later charged with war crimes at the Nuremberg Tribunals after World War II. These trials placed the story of their financial and moral support of the Nazis into the historical record. Krupp was a huge arms manufacturer. I.G. Farben was a vast chemical company which made everything from Bayer aspirin to Zyklon B, the poison used in the gas chambers.
According to The Arms of Krupp, the Nazi Party was essentially bankrupt in late 1932. Joseph Goebbels, who would later become the Minister of Propaganda, complained, “[w]e are all very discouraged, particularly in the face of the present danger that the entire party may collapse….The financial situation of the Berlin organization is hopeless. Nothing but debts and obligations.”
Regardless of the party’s financial problems, Hitler was named Chancellor in late January 1933. He called for elections in early March. With less than two weeks left before the vote, Herman Goering sent telegrams to Germany’s 25 leading industrialists, inviting them to a secret meeting in Berlin on February20, 1933. Attending the gathering were four I.G. Farben directors and Krupp chief Gustav Krupp. Hitler addressed the group, saying “private enterprise cannot be maintained in a democracy.” He also told the men that he would eliminate trade unions and communists. Hitler asked for their financial support and to back his vision for Germany.
According to Robert Jackson, the former Supreme Court Justice and chief U.S. prosecutor at Nuremberg, “[T]he industrialists…became so enthusiastic that they set about to raise three million Reichsmarks worth about [$30 million today] to strengthen and confirm the Nazi Party in power.”
Gustav Krupp was the first executive to speak at the Berlin meeting, and pledged one million marks. As the United Nations summarized in a 1949 report, Krupp was a key financier for the Nazi Party, including through his corporation:
It was clear from the evidence that Gustav Krupp embraced Nazism shortly prior to the seizure of power by the Nazi Party and continued his allegiance thereafter.He played an important part in bringing to Hitler’s support other leading industrialists and through the medium of the Krupp firm… from time to time made large scale contributions to the [Nazi] Party Treasury.
Hitler awarded Krupp the title of Fuhrer of Industry later in 1933.
Krupp acted in concert with other businessmen, including the directors of I.G. Farben, then Europe’s largest corporation. I.G. Farben’s full name was Interessen Gemeinschaft Farbenindustrie Aktiengesellschaft which translates to “Community of Interest of the Dyestuffs Industry, Incorporated” or as one of the Nuremburg prosecutors, Josiah DuBois Jr. in his book, The Devil’s Chemists, put it, the name was “like the cross between a service club and Easter eggs.” But what I.G. Farben did with the Nazis was no laughing matter, including using slave labor at a specially-constructed plant at Auschwitz called Monowitz.
In the opening of the tribunal against the directors of I.G. Farben, prosecutor U.S. Gen. Telford Taylor stated: “The indictment accuses these men of major responsibility for visiting upon mankind the most searing and catastrophic war in human history. It accuses them of wholesale enslavement, plunder, and murder.”
At the February meeting, the I.G. Farben executives gave the Nazis 400,000 marks, and a total of 4.5 million marks by the end of 1933, according to The Crime and Punishment of I.G. Farben. This infusion of corporate cash saved the Nazi Party from financial disaster. The rest, as they say, is history — tragic, tragic history.
As the book Hell’s Cartel explains, the history of the German industrialists’ support of Hitler shows “what can go wrong when political objectives and the pursuit of profit become dangerously entwined.” One can only surmise what might have happened if the businessmen had simply said “no” to Hitler that night.
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https://www.congress.gov/event/116th-congress/house-event/LC65581/text?s=1&r=2
CITIZENS UNITED AT 10: THE CONSEQUENCES FOR DEMOCRACY AND POTENTIAL
RESPONSES BY CONGRESS
===
HEARING
BEFORE THE
SUBCOMMITTEE ON THE CONSTITUTION,
CIVIL RIGHTS, AND CIVIL JUSTICE
OF THE
COMMITTEE ON THE JUDICIARY
HOUSE OF REPRESENTATIVES
ONE HUNDRED SIXTEENTH CONGRESS
SECOND SESSION
__
FEBRUARY 6, 2020
`` WITNESSES
The Honorable Ted Deutch, Member of Congress
Oral Testimony............................................... 9
Prepared Testimony........................................... 34
The Honorable Pramila Jayapal, Member of Congress
Oral Testimony............................................... 39
Prepared Testimony........................................... 41
Ellen L. Weintraub, Commissioner, Federal Election Commission
Oral Testimony............................................... 45
Prepared Testimony........................................... 48
Robert Weissman, President, Public Citizen
Oral Testimony............................................... 53
Prepared Testimony........................................... 55
Bradley A. Smith, Josiah H. Blackmore II/Shirley M. Nault
Professor of Law, Capital University Law School
Oral Testimony............................................... 56
Prepared Testimony........................................... 58
Ciara Torres-Spelliscy, Professor of Law, Stetson University
College of Law
Oral Testimony............................................... 71
Prepared Testimony........................................... 73
LETTERS, STATEMENTS, ETC. SUBMITTED FOR THE HEARING
Statement by the Honorable Jerrold Nadler, submitted by the
Honorable Steve Cohen, Chairman, Subcommittee on the
Constitution, Civil Rights, and Civil Liberties................ 6
Items for the record submitted by the Honorable Ted Deutch,
Committee on the Judiciary..................................... 10
Items for the record submitted by the Mary Gay Scanlon, Committee
on the Judiciary............................................... 92
Items for the record submitted by the Steve Cohen, Committee on
the Judiciary.................................................. 106
...
Mr. Cohen. Thank you, Mr. Weissman.
Our next witness is Mr. Bradley Smith. Rarely is a witness
thanked for coming and complimented by the other side, so you
are special.
Bradley Smith holds the Josiah H. Blackmore II/Shirley M.
Nault Professor of Law position at Capital University Law
School. He is one of the nation's leading authorities on
election law and campaign finance, and co-author of ``Voting
Rights and Election Law,'' a leading casebook in the field. He
previously served for five years as a member of the FEC and
Chair of the Commission in 2004.
He received his J.D. cum laude from Harvard Law School.
Do any of you ever get accepted at another school?
[Laughter.]
And his B.A. from Kalamazoo College.
Professor, you are recognized.
TESTIMONY OF BRADLEY SMITH
Mr. Smith. Thank you, Mr. Chairman and members of the
committee.
I guess I would begin simply by saying that repeatedly
calling a decision a disaster doesn't really make it so, and we
haven't really heard much evidence that actually ties the idea
that people can't enact their preferences to anything that has
come about from Citizens United.
In fact, Citizens United has had a number of beneficial
effects on American society. We were told that it would lead to
an oligarchy, an entrenched group of people who would strangle
American democracy. And yet instead, in the years since
Citizens United, politics in America has been more fluid.
Congressional incumbent reelection rates have declined. That
may not be good news for all of you, but it cuts against
certainly the argument that has been made against Citizens
United.
We have seen that either Congress or the presidency has
changed hands in four of the five election cycles since
Citizens United. There are more newcomers in Congress by about
40 percent each time around. That may be good news for some of
you who are among those newcomers.
Outsiders such as the President himself, such as at least a
contender to the President in the general election, Senator
Sanders, people such as Representative Ocasio-Cortez or former
Representative Braut have been complete outsiders who have
dramatically shaken up the system and defeated entrenched
insiders, typically by spending far less money.
We find that the trend of more women being elected to
office has continued, and there are other things that are just
kind of interesting. For example, the rate of spending increase
in American politics has actually declined considerably since
Citizens United. I don't think that is because of Citizens
United, but it certainly cuts against the notion that this is
some disaster leading to this massive explosion in spending. It
is just not really so.
We find that most money in politics, dramatically so, still
comes from individuals in amounts limited under the law. The
vast majority still comes in limited individual contributions.
But corporate contributions, which make up at most--I don't
know how we want to calculate it and what we do with this small
percentage of money, about 2 or 3 percent that is so-called
``dark money,'' how much we think that might be corporate
money. If we take the worst case, so to speak, the highest case
scenario, we are talking about 5 percent of spending, maybe 6
percent coming from for-profit corporations. That is hardly
drowning anybody out. And, in fact, it is a good thing. The
American people have a right to hear those voices, they should
hear those voices, and polling data shows that they actually
want to hear those voices and believe that business has a right
to comment on issues of concern.
Finally, it is important to remember what the case was all
about. It was the position of the United States Government that
it could censor a book or a movie if that book or movie was at
any stage produced or distributed with corporate funds, like
every other book or movie you have ever bought on Amazon or in
a book store or seen in a theater or seen on cable or streaming
television. That was the position of the government, that you
could censor this. In that respect, the position that four
members of the Supreme Court actually endorsed that is the
truly radical view that we saw in Citizens United.
We have heard a lot in both the opening panel and from my
colleagues here about all these policy initiatives that have
been blocked, and it is curious to me that they all happen to
be policy preferences of the American political left. There is
nothing wrong with the political left having policy
preferences, but the idea that you are not able to enact your
policy preferences unless you can kneecap people who oppose
those is hardly something that the First Amendment endorses.
Indeed, that is why we have a First Amendment, so you can't
kneecap your opponents in order to shut them up so that you can
pass whatever policies you want.
I find it interesting. We had the NRA used as an example.
The NRA has 3 to 5 million members. These are U.S. citizens,
people who are out there, and they care intensely about these
issues. They talk to their neighbors and they work on these
issues, and that is why these things sometimes don't come
through.
I remind you, it is not impossible to pass legislation.
Medicare, Social Security, the Voting Rights Act, the Civil
Rights Act, these things all passed when contributions even
from individuals were unlimited and almost never reported
because there was no enforcement mechanism even on reporting.
So I think when we look at things more rationally, we see
that while the American people certainly don't like Citizens
United when they are asked specific questions like ``Do you
think corporations should be able to speak in elections?'',
when we ask ``Do you think Citizens United should have been
able to show its movie?'', we find that majorities, in some
cases substantial majorities, do, in fact, favor those
positions.
So again, I would say Citizens United has been good for the
United States, but mostly it is really good for the First
Amendment precisely because it does what the First Amendment is
supposed to do. It is a check.
Thank you.
[The statement of Mr. Smith follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Mr. Cohen. Thank you, sir.
Finally, our last witness is Ms. Ciara Spelliscy. She is a
Professor of Law at Stetson College of Law in Florida. She
teaches election law, corporate governance, business entities,
and constitutional law. Prior to joining Stetson's faculty she
was Counsel to the Democracy Program at the Brennan Center for
Justice at NYU School of Law, where she provided guidance on
the issue of money in politics. She was a staffer for Richard
Durbin up here on the Hill.
She received her J.D. from Columbia University and her A.B.
from Harvard.
Professor, you are recognized for 5 minutes.
TESTIMONY OF CIARA TORRES-SPELLISCY
Ms. Torres-Spelliscy. Thank you. Good morning. My name
is
Ciara Torres-Spelliscy. I live in a swing district in the swing
state of Florida. My law students are Republicans, Democrats,
and Independents, and I am here to tell you that American
voters are worried about the state of our elections after the
attacks on our democracy in 2016.
What American voters see from Congress and from the Federal
Election Commission is not reassuring. It looks like they
cannot get out of their own way to protect the integrity of
American elections. This was true before 2016, but after 2016
it is nothing short of excruciating to watch Congress and the
FEC not act in the face of eager enemies.
Now without a quorum, the FEC is more powerless than ever
at a time when the 2020 election already has candidate debates,
large-scale rallies, primary votes, and big political
fundraising to the tune of over $2 billion already.
Nearly a decade ago, I told Congress right after Citizens
United that I could predict two problems with inviting
corporate money into our democracy: a lack of shareholder
consent, and a lack of transparency. And I wish my prediction
had not come true, but it did.
Today I will focus on the lack of transparency, which is
better known as the dark money problem. Dark money has
blanketed our elections since 2008. To date, over a billion
dollars in dark money has been spent in Federal elections
alone. With dark money you can see the public dance, but you
can't see the puppeteer. And after the 2016 election, Americans
really deserve to know whether any of those puppeteers were
foreign nationals or foreign governments.
As I note in my book, Political Brands, we know from the
redacted Mueller Report, as well as indictments of Russians by
the Special Counsel's Office, that Russians were trying to
influence the 2016 election, including by purchasing political
ads on Facebook with rubles. In nearly any other area of the
law, what happens with dark money would be akin to money
laundering. But in election law, most dark money is actually
legal.
The FEC is the primary regulator with the ability to stop
dark money, and instead they have basically done nothing. The
FEC could have started rulemakings to end dark money even
before Citizens United, because the problem appeared before
- The typical way that dark money is created is by spending
through an opaque non-profit, like a 501(c)(4) or a 501(c)(6),
and the porous rules at the FEC have allowed donors to remain
anonymous. The only change that has come was at the order of a
Federal court in CREW v. FEC.
One thing American voters still do not know is whether dark
money is hiding illegal foreign money. And because the FEC has
largely been stuck in deadlocks, even investigations or
punishment for foreign spending has largely been lacking.
As I discussed in my first book, Corporate Citizen, in a
particularly colorful episode, a foreign pornographer spent in
a Los Angeles election in 2012. This spending violated
longstanding bans on foreign money in American elections,
whether they are Federal, state, or local. But the FEC would
not enforce the law against the foreign pornographer. If the
FEC is not going to stand up to a foreign pornographer, it begs
the question who would they stand up against?
This general lack of enforcement against foreign spending
has sent a terrible message to anyone who was paying attention.
The message is that campaign finance laws are basically not
being enforced at the Federal level by the FEC, and as American
voters face 2020, the Department of Justice is the only cop
left on the beat. But DOJ can only enforce willful and
egregious violations of law. This leaves a vast wasteland of
unenforced campaign finance laws where cheating and corner-
cutting is all but invited.
And this happens as American voters are asked to choose the
next president, all of the members of the House, a third of the
Senate, 11 governors, and 45 state legislatures.
Given the experience of 2016 with Russians breaking
American election laws with abandon, the lesson for North
Korea, China, Iran, or any other hostile nation is that
interference in our elections can be done with little
consequence.
So the FEC needs a full complement of commissioners so that
they can at least act. And if you are serious about reform, you
need to add an additional seat to the FEC so that, like every
other Federal agency, they have an odd number of commissioners
so that they can enforce the law instead of ending in a
deadlock.
And you can improve disclosure by either changing election
laws or changing securities laws, or possibly both. And, of
course, you could expand what Congress can constitutionally
regulate if the Constitution is amended to address Citizens
United and other campaign finance cases like Buckley.
But in our constitutional system, the fate of the nation is
in your hands. Thank you.
[The statement of Ms. Torres-Spelliscy follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
... Mr. Raskin, you are recognized for 5 minutes.
Mr. Raskin. Mr. Chairman, thank you.
Welcome to all of our distinguished witnesses today, and
all of the natural persons who have come to participate in
today's proceeding.
The first thing that I want to point out is that Citizens
United did not enlarge the free speech rights of any citizen in
the United States, not even CEOs or corporate executives who
could spend already whatever they wanted as independent
expenditures under Buckley v. Valeo. All that Citizens United
did was to transform every corporate treasury in America into a
potential political slush fund and thereby authorize and
empower the CEOs of the corporations to spend whatever they
wanted of other people's money in the corporate treasuries in
political campaigns.
This declaration did transform, to my understanding, two
centuries of jurisprudential understanding of what a
corporation is. You can go back to Chief Justice John
Marshall's opinion in 1819 in the Dartmouth College v. Woodward
case, where he said that a corporation is an artificial entity,
invisible, intangible, existing only in contemplation of law,
possessing only the rights conferred upon it by the state
legislature and not the constitutional rights of the people.
And yet the Roberts court in Citizens United endowed private
corporations, these invisible, intangible, artificial entities,
with the political rights of the people, essentially arming the
CEOs with the power to spend other people's money, as Justice
Brandeis termed it, in political campaigns. And for all of the
reasons stated by the witnesses, that has occasioned a dramatic
change in the character and the quality of American politics.
Now, I favor a constitutional amendment for the same reason
that I support all the constitutional amendments that have
reversed reactionary jurisprudence by the Supreme Court. That
is how we got women's suffrage in the 19th Amendment which
toppled the Supreme Court's decision in Minor v. Happersett,
saying that women did not get the right under the 14th or 15th
Amendment. The 14th Amendment, and the 15th and 13th, of
course, reversed the Supreme Court's reactionary decision in
the Dred Scott case before the Civil War. It is how we got the
26th Amendment. It is how we got the 24th Amendment. Most of
our amendments have been democracy-deepening, suffrage-
enlarging, democracy-perfecting amendments where the people
have to overturn pinched and reactionary understandings of the
Supreme Court.
But until we get there, I wanted to take up an issue that
comes out of Citizens United, because Justice Kennedy's conceit
in his majority opinion is that the corporations are speaking
for the shareholders, the corporations derive their First
Amendment political rights from the First Amendment rights of
the human beings who actually own stock in the corporation. But
there is a problem, which is that the corporations are spending
all of this money and putting money into political campaigns
and dark money channels and so on without ever consulting the
shareholders themselves; and, in fact, in most cases not even
notifying the shareholders. And they have been doing everything
in their power to fight in both the SEC and the FEC efforts to
get just notice to people of how their money in the corporation
is being spent.
I introduced a measure which became part of H.R. 1 which I
call Shareholders United. Shareholders United says that no
corporation shall be allowed to spend any money in politics
until you have first notified the shareholders of the proposal
and they are authorized in advance by majority vote that their
money be spent in a political campaign.
I am wondering if each of you, if you could go quickly--and
forgive us because we have our 5-minute stricture here. But
would you agree that as long as we are living under the regime
of Citizens United, that the shareholders should have the right
to be apprised of proposed political spending by corporations
of their money, and they should have the right to vote on it? I
know there is an argument that there should have to be a 100
percent vote, but at the very least there should be a majority
vote before the corporation goes ahead and spends their money.
And I could start with you, Madam Chair.
Ms. Weintraub. Yes.
Mr. Weissman. Absolutely. And as you know, more than a
million people have requested the SEC to issue a rule to do
exactly what you are suggesting.
Mr. Raskin. Professor Smith, do you agree?
Mr. Smith. No. This is a complex question of corporate
governance and there are many things corporations do, including
things that affect politics, that they don't require
shareholder approval for.
Mr. Raskin. Okay. And Professor Spelliscy?
Ms. Torres-Spelliscy. I wholeheartedly endorse your bill. I
think shareholders should have the right to consent to
corporate political spending, and that would bring American law
in line with the U.K., where shareholders in U.K. companies do
have the right to pre-approve corporate political spending.
Mr. Raskin. Okay.
Mr. Cohen. Thank you, Mr. Raskin.
Mr. Raskin. I yield back, Mr. Chairman.
Mr. Cohen. Mr. Cline, you are recognized for 5 minutes.
Mr. Cline. Thank you, Mr. Chairman, appreciate it.
I would note that one of the things that we have that the
U.K. doesn't have is the First Amendment.
The majority in Citizens United maintain that political
speech is indispensable to a democracy, which is no less true
because the speech comes from a corporation. The majority also
held that the BCRA's disclosure requirements as applied to the
movie were constitutional, reasoning that disclosure is
justified by a governmental interest in providing the
electorate with information about election-related spending
resources.
The Court also upheld the disclosure requirements for
political advertising sponsors and upheld the ban on direct
contributions to candidates from corporations and unions.
What it did not do is overturn centuries of law. Rather, it
overturned portions of McCain-Feingold which had become law in
2002, another law that went into effect in the 1940s, and two
Supreme Court decisions in whole or in part, Austin v. Michigan
Chamber of Commerce from 1990 and McConnell v. FEC from 2003.
So I would ask Professor Smith, in your prepared testimony
you quote part of the oral argument in Citizens United in which
the government argues that as a matter of constitutional law it
can ban books or movies if corporate resources are used in
their production or distribution. Is that correct?
Mr. Smith. Yes.
Mr. Cline. And can we talk about whether this is really a
danger?
Mr. Smith. Yes. Citizens United was rescheduled after that
first oral argument, and in the second oral argument then-
Solicitor General Kagan argued, well, we would never actually
do that. But, in fact, the FEC from time to time has done that.
In a little-noticed 1987 advisory opinion, the FEC informed
U.S. News and World Report that their publication of a book
would not be exempt under the press exemption because it was
not a periodical, that it would therefore be potentially
illegal to distribute a book.
Now, maybe that wasn't noticed so much because in the end
U.S. News wasn't really going to do that. It was dismissed on
other grounds. But the FEC made that point.
Just in the last decade, in 5642, the FEC spent almost two
years investigating publication and distribution of a book, one
that was written by George Soros, and it was eventually
dismissed. But it should be noted that the General Counsel in
that case recommended that the FEC find a violation due to
distribution of a book about policy, a book called The Bubble
of American Supremacy, because it included such radical
statements as ``It is not enough to defeat President Bush at
the polls,'' and ``We can regain the moral high ground only by
rejecting President Bush when he stands for reelection,'' and
that was considered enough that that book could have been
potentially banned.
So I do think it is a real issue.
I would also note that when Justice Kagan, or now-Justice
Kagan, then-Solicitor General Kagan, was asked what about
pamphlets, she said pamphlets we ban, we definitely go in for
pamphlets.
I have here a copy of Common Sense, the great revolutionary
tract by Thomas Paine. It is 54, 58 pages. That includes a
couple of cover pages here. Is this a book or a pamphlet? I
will ask you all to vote for it because you are the legislators
who will get to decide whether or not this can be published or
whether or not this can be banned as a pamphlet.
Mr. Cline. Thank you.
Some of our Democratic colleagues in the Senate have
previously introduced a constitutional amendment to undo or
overturn Citizens United. The amendment would allow Congress to
regulate the giving and spending of money on political advocacy
but explicitly carves out the press. Do you have any views on
that approach?
Mr. Smith. Well again, if I may, Mr. Cline, I want to
briefly address something that my old colleague--we were law
professors going back. You got your J.D. from Harvard, too; is
that right?
I think, Mr. Chairman, that we should probably note that
again.
But in any case, one thing I did want to comment, though,
is that who has benefitted--...we haven't seen this torrent of money from Fortune 100 companies. The corporations that have
benefitted are small corporations, and most of those
corporations can't afford to operate a PAC, they can't afford
to have a lobbyist here, and those are the corporations that
are really benefitting from this, and those are closely held
corporations where I think we can usually find the shareholder
benefits.
===
an 7 22
a judge ruling in favor of a billion-dollar defamation lawsuit moving forward signals the possibility of looming financial woes for Rupert Murdoch's Fox News. According to The Guardian, Delaware Supreme Court Judge Eric David in June ruled that Dominion Voting Systems could proceed with its defamation lawsuit against Fox News and its parent company, Fox Corporation.
The lawsuit is a legal pushback against Fox News' reporting and perpetuation of voter fraud and election misinformation following the 2020 presidential election.
Per The Guardian, David determined "that it was a reasonable inference that Murdoch and son Lachlan either knew outright that Dominion had not manipulated the election or 'recklessly disregarded the truth' guk when Fox disseminated lies initially launched by Donald Trump."
Speaking to The Guardian, a number of legal experts have offered their perspective on the case and why it suggests trouble ahead of Fox News. Ciara Torres-Spelliscy, a Stetson University constitutional law professor and fellow at the Brennan Center for Justice, weighed in on Dominion's case as she noted that the voting technology company appears to have a substantial argument.
“Dominion has a very strong case against Fox News,” Torres-Spelliscy said to the news outlet, adding that "all of the 'conspiracy theories about Dominion’s machines were just pure bunk,'" She also noted that "Fox as a news organization should have known that and not given this aspect of [Trump’s] ‘big lie’ a megaphone.”
“I think once you start to pull the discovery material, what you’re going to find is there was a lot of communication between the Trump people both internally and externally about pushing very specific lies and narratives,” said Media Matters for America chief executive, Angelo Carusone.
However, Fox News is confident that it will survive this legal battle.
A Fox spokesman told also released a brief statement to the news outlet on behalf of the network. “We are confident we will prevail in this case, as the First Amendment is the foundation of our democracy and freedom of the press must be protected,” the spokesman said.
In addition to the lawsuit against Fox News, Dominion also has a $1.6 billion lawsuit against conservative news networks One America News Network (OAN) and Newsmax.
===
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an ah 3 23
The Religious Right movement, which gained considerable momentum during President Ronald Reagan's 1980 campaign, has had a complex relationship with Catholicism over the years. The Religious Right is dominated by far-right white evangelical Protestant fundamentalists, who are vehemently critical of Catholic practices (the confessional, physical images of Jesus). Yet Republican evangelicals will work with the Catholic right when it comes to fighting abortion or same-sex marriage.
The Catholic right is by no means universally loved by American Catholics. President Joe Biden and former House Speaker Nancy Pelosi (D-California), for example, are both known for being devout Catholics, but they are also major critics of the Religious Right and its influence on the U.S. Supreme Court — which the Catholic right now dominates. Justice Clarence Thomas, Justice Samuel Alito, Justice Brett Kavanaugh and Justice Amy Coney Barrett are all hard-right Catholics and GOP appointees who voted to overturn Roe v. Wade in the Dobbs v. Jackson Women’s Health Organization ruling of 2022.
In contrast, Justice Sonia Sotomayor, a Democratic Barack Obama appointee, is a Catholic who was a dissenter in Dobbs and has been a scathing critic of the High Court's current direction. She even used the word "stench" to express her disdain. Sotomayor is to the left of the Vatican, while Thomas, Alito and Barrett are to the right of the Vatican.
One of the Catholic right's most influential figures is judicial activist Leonard Leo, former executive vice president of the Federalist Society. Leo has spent decades lobbying to push the federal courts to the far right. And according to Politico's Heidi Przybyla, he has made a fortune in the process.
In an article published by Politico on March 1, Przybyla reports, "A network of political nonprofits formed by judicial activist Leonard Leo moved at least $43 million to a new firm he is leading, raising questions about how his conservative legal movement is funded. Leo's own personal wealth appeared to have ballooned as his fundraising prowess accelerated since his efforts to cement the Supreme Court's conservative majority helped to bring about its decision to overturn abortion rights. Most recently, Leo reaped a $1.6 billion windfall from a single donor in what is likely the biggest single political gift in U.S. history."
According to Przybyla, Politico's analysis of "dozens of financial, property and public records dating from 2000 to 2021" shows that Leo's "lifestyle took a lavish turn beginning in 2016." And his fortunes grew considerably during the Trump years, Przybyla reports.
READ MORE: Dark money groups pump nearly $90 million into 'independent state legislature' case
The Politico journalist explains, "The spending by Leo-aligned nonprofits on his for-profit businesses coincided with changes in his personal lifestyle and finances. IRS and other public records between 2016 and 2020 show a major expansion of Leo's personal wealth that coincided with the start of his work for Trump and the creation of his own for-profit entity calledBH Group. Both happened in 2016."
The former Federalist Society VP forcefully lobbied for many of the severe social conservatives who are now on the U.S. Supreme Court, including Barrett. In 2016, he encouraged then-Senate Majority Leader Mitch McConnell (R-Kentucky) to do everything he could to derail then-President Barack Obama's nomination of Merrick Garland following the death of Justice Antonin Scalia (a far-right Catholic social conservative). It worked; that seat stayed open until 2017, when then-President Donald Trump appointed Justice Neil Gorsuch — another justice who voted to overturn Roe in 2022. Gorsuch was raised Catholic but has more recently attended an Episcopal church.
Trump was very specific about the type of justices he wanted: hardcore social conservatives. Former Justice Anthony Kennedy was a right-wing fiscally conservative 1987 Reagan appointee, but he was much more of a libertarian than Scalia, Alito or Thomas and often voted with Democratic justices when it came to abortion or gay rights. And that wasn't the type of justice that Trump and Leo wanted.
Przybyla notes, "The Court’s 2022 decision overturning half a century of the federal right to abortion was widely seen as a victory for the conservative legal movement led by Leo. Trump picked his Court nominees from a list drawn up by Leo, who then served as his unofficial adviser in the White House. A constellation of outside groups affiliated with Leo poured tens of millions of dollars in anonymous donor funds into promoting those nominees — Neil Gorsuch, Brett Kavanaugh and Amy Coney Barrett — thereby cementing a new conservative majority for the next generation."
Read Politico's full report at this link.
3 23 raw
Leonard Leo, the right-wing leader of the judicial activist network the Federalist Society, is coming under scrutiny for his "lavish" use of the organization's funds to live the high life, POLITICO reported on Wednesday.
"A network of political non-profits formed by judicial activist Leonard Leo moved at least $43 million to a new firm he is leading, raising questions about how his conservative legal movement is funded," reported Heidi Przybyla. "Leo’s own personal wealth appeared to have ballooned as his fundraising prowess accelerated since his efforts to cement the Supreme Court’s conservative majority helped to bring about its decision to overturn abortion rights. Most recently, Leo reaped a $1.6 billion windfall from a single donor in what is likely the biggest single political gift in U.S. history."
Leo has been a massively influential figure, often called Trump's "judge whisperer" for the outsized role he played in getting right-wing jurists seated who have been involved in everything from dismantling abortion rights, to rolling back voting and redistricting protections, to undermining the regulatory process.
According to POLITICO, which has obtained records of Leo's finances over the last two decades, Leo's personal wealth skyrocketed under President Donald Trump, with whom he worked closely to appoint a steady stream of right-wing judges to the federal bench including three at the Supreme Court — "the same period during which he erected a for-profit ecosystem around his longtime nonprofit empire that is shielded from taxes."
CRC Advisers, the consulting firm he created in 2020, did not respond to questions about what the $43 million is being used for. However, Leo, who led a "middle class lifestyle" prior for most of his time at the Federalist Society, began making extravagant purchases after the former president's election in 2016, including "two new mansions in Maine, four new cars, private school tuition for his children, hundreds of thousands of dollars in donations to Catholic causes and a wine buyer and locker at Morton’s Steakhouse."
Stetson University law professor Ciara Torres-Spelliscy, an expert on campaign finance, told POLITICO, “If millions of dollars in dark money are sloshing around, it makes it really easy for people on the inside to take a cut ... That behavior is, unfortunately, now showing in the judicial nominating process."
This is not the first time questions have been raised about Leo's financial activities. In 2019, The Washington Post flagged that Leo has helped right-wing nonprofits raise $250 million to promote his approved judges, with no transparency in the donors' identity. And another dark-money group, BH Ventures, which contributed $24 million to CRC Advisors and up to $5 million to former Trump adviser Kellyanne Conway's polling firm, shut down shortly after reporters began investigating it.
Alarmed Democrats have responded in force to the Federalist Society's efforts to remake federal courts. Since taking office, President Joe Biden has been confirming judges at an even faster pace than Trump did, with 97 seated in his first two years alone — often from a diverse array of racial and professional backgrounds.
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Although the MAGA movement has promoted intense hyper-nationalism and former President Donald Trump once chastised former Florida Gov. Jeb Bush for speaking Spanish on the campaign trail, the pro-Trump Great America PAC was fined by the Federal Election Commission earlier this month for soliciting foreign contributions. And according to Talking Points Memo's Ciara Torres-Spelliscy, the U.S. Supreme Court "appears" to be on the side of those who want to keep foreign money out of U.S. politics.
"Massachusetts is trying to limit foreign corporate political spending in is its elections through new legislation, and the U.S. Supreme Court, it appears, is actually on their side," Torres-Spelliscy, a law professor at Stetson University, reports. "This may come as a surprise: The Roberts Court has repeatedly opened the doors to more money in politics. And Justice (Samuel) Alito famously disagreed with President (Barack) Obama who, during the 2010 state of the union, scolded the justices to their face about their ruling in Citizens United."
Obama, a major critic of the U.S. Supreme Court's 2010 decision in Citizens United v. Federal Election Commission, said, "I don't think American elections should be bankrolled by America's most powerful interests —or worse, by foreign entities."
Torres-Spelliscy explains, "Foreign nationals, the human kind, have long been barred from spending in U.S. elections under 52 U.S.C. § 30121. That is why election law experts had their hair on fire about the question of Russian interference (in) the 2016 election. And even the Roberts Supreme Court, in a case called Bluman v. FEC, upheld the constitutionality of the ban on foreign nationals' spending money in American elections. But the law has been as clear as mud between 2010's Citizens United and 2020's Open Society II about whether that foreign ban naturally applied to foreign corporations as well as humans."
The reporter adds, "In two cases, the State of California and the FEC took the position that the foreign ban did apply to foreign corporations."
Torres-Spelliscy elaborates on why the U.S. Supreme Court's 2020 ruling in *Agency For International Development v. Alliance For Open Society International* is important.
According to Torres-Spelliscy, "These state and local efforts to keep foreign money out have generated criticism that they would violate the First Amendment rights of corporations under Citizens United to spend money in politics. That's why the Open Society II case is so important: it indicates that foreign corporations cannot raise First Amendment objections to U.S. laws or policies. Thus, a law that bans foreign corporations from spending in U.S. elections cannot be challenged by a foreign corporation as a violation of free speech. According to Open Society II, foreign corporations have no such rights to assert. This means reforms like those in St. Petersburg, Washington State and pending in Massachusetts are on firmer constitutional ground."
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https://www.americanbar.org/groups/crsj/publications/human_rights_magazine_home/we-the-people/we-the-people-corporations/
ABA!
Introduction: Contesting Personhood}:
The plain meaning of words can get mangled in the hands of a clever lawyer. One word that is heavily contested in the American legal context is “person”—and by extension—who counts as a member of “we the people.” For instance, Chief Justice Roger B. Taney had a case before him in 1857 where a man was trying to claim his status as a free man because he had long lived in a free territory of the United States. In Chief Justice Taney’s hands, Mr. Scott was not a person at all. He was property to be bought, sold, and inherited, and the only rights Chief Justice Taney would protect were the property rights of his owner. In Dred Scott, the Supreme Court concluded that African Americans were not included in “we the people” in the preamble of the U.S. Constitution. The Court concluded that blacks “had no rights which the white man was bound to respect. . . .”
This racist conclusion of the Supreme Court fencing out African Americans from counting as “persons” was controversial in its day. In response toDred Scott, ex-slave Frederick Douglass gave a speech before the American Anti-Slavery Society. He said of the U.S. Constitution’s preamble, the text says,
“We, the people”—not we, the white people—not we, the citizens, or the legal voters—not we, the privileged class, and excluding all other classes but we, the people; not we, the horses and cattle, but we the people—the men and women, the human inhabitants of the United States. . . .
Thus, Douglass reasoned “we the people” included African Americans as well.
Courts continue to this day to wrestle with the basic question of who or what counts as a person with protectable rights. Flash forward to 2010 when the Supreme Court ruled in Citizens United v. FEC that corporations have First Amendment political rights to buy ads in all American elections. If the logical flaw in Dred Scott was mistaking a person (Mr. Scott) for a piece of property, the blunder in Citizens United was mistaking a piece of property (a corporation) for a person. (For a longer analysis of the Scottdecision, see Crooms-Robinson’s article that begins on page 2.)
Through Article V amendments to the Constitution, the American people decided that individuals who had long been excluded from being considered part of “we the people,” like African Americans and women, were, in fact, full members of the body politic. But now counter-majoritarian courts are taking the lead in shoehorning corporations into roles that previously only American citizens occupied. Corporations do not have coequal constitutional rights as living, breathing human citizens, but they are making claims on more rights that, until relatively recently, were only asserted by real people.
The Evolution of the Corporate Form
I wrote about the bizarre U.S. Supreme Court jurisprudence surrounding corporations in my book Corporate Citizen? An Argument for the Separation of Corporation and State. In a nutshell, in my book I argue that the Supreme Court is allowing for vastly expanded corporate rights, while at the same time the same Court is excusing corporations from a growing list of responsibilities. As I demonstrate in my book, corporate lawyers have a long history of arguing for expanded notions of corporate personhood in America. In fact, early American lawyers were only carrying on a tradition that started centuries ago across the sea in Europe. The idea of anthropomorphizing corporations through “corporate personhood” dates back to a medieval pope who was also a lawyer. The idea of corporate personhood spread across Europe, jumped to England, and landed in America along with the British colonists.
Corporations have evolved radically since America became a nation at the end of the eighteenth century. Justice Louis Brandeis, in his famous dissent in Liggett, 288 U.S. at 554–56, Louis K. Liggett Co. v. Lee (1933), explained the historical path of the expansion of corporations from single-purpose entities with limited terms of existence into the multipurpose, immortal behemoths we have today. As Justice Brandeis wrote:
Limitations upon the scope of a business corporation’s powers and activity were also long universal. At first, corporations could be formed under the general laws only for a limited number of purposes—usually those which required a relatively large fixed capital, like transportation, banking, and insurance, and mechanical, mining, and manufacturing enterprises. Permission to incorporate for “any lawful purpose” was not common until 1875; . . . All, or a majority, of the incorporators or directors, or both, were required to be residents of the incorporating state. The powers which the corporation might exercise in carrying out its purposes were sparingly conferred and strictly construed.
As Justice Brandeis noted, the purposes of corporations were once narrow and are now incredibly broad.
One of the big changes from the founding to today is that, at the founding, only a special legislative act could create a corporation. By contrast, now, under general incorporation statutes, incorporators can file a few administrative papers, pay a few fees, and be the proud owner of their very own corporation. And many take advantage of this ease and convenience. Approximately 2 million corporations are incorporated annually in the United States. Delaware has clearly won the race for corporate charters, as the majority of U.S. corporations are incorporated in Delaware, America’s second smallest state.
Additionally, at the founding, corporations were created for a limited purpose, like building a road from point A to point B. Now, while incorporators could limit the purpose of a corporation in its articles of incorporation, few do. Rather, the norm presently is for entrepreneurs to establish corporations for “any lawful purpose.” This allows modern firms to do multiple lines of business as well as assert the ability to act in non-business fora.
After Citizens United was decided in 2010, bumper stickers appeared stating: “I’ll believe a corporation is a person when Texas executes one.” What this clever catchphrase captures is the fact that corporations are not corporeal. Contemporary corporations, unlike their human counterparts, can exist in perpetuity, hence why they are sometimes referred to as being “immortal.” Cryogenics aside, although Walt Disney the man died, the Walt Disney Company shows no signs of going anywhere anytime soon.
This wasn’t always the case. Until 1875, corporate franchises were for a limited term of years. But eventually, as states competed in a race to the bottom for corporate charters, they all eventually allowed corporations to continue in perpetuity. So now, anyone can incorporate a corporation, and those corporations do not have to be for a limited purpose, or for a limited time. This, of course, could be changed if state laws, like those in Delaware, were changed to require corporations only for limited terms.
Today, immortality is a feature of modern corporations, not a bug. But this may be why granting corporations the same rights as individuals doesn’t always make sense. As the Supreme Court once concluded, “[s]ometimes the grossest discrimination can lie in treating things that are different as though they were exactly alike[.]” Buckley v. Valeo, 424 U.S. 1, 97–98 (1976). And this seems particularly apt, when corporations and humans are being balanced on the scales of justice.
As corporations themselves grew, simultaneously the diffusion of stock ownership grew dramatically. At the founding, the owners of a corporation would typically be a small circle of people. As such, a small group of investors could easily keep an eye on how their investments were being managed. But with the modern publicly traded corporation, millions of people may own stock in a single firm. Shareholders are geographically dispersed, and because each one typically owns only a fraction of a percent of the firm, the incentive to keep a watchful eye over management is diminished. In the 1930s, Professors Berle and Means worried that this separation of management from control would prove troublesome. And time has shown that Berle’s and Means’s instincts were correct. Whether the issue is executive compensation or other aspects of corporate governance, shareholders have collective action problems that inhibit the coordination of large numbers of investors, and they also have a rational disinterest in not monitoring corporate insiders on a regular basis. Corporate managers, thus, may act in undisciplined and self-serving ways at the expense of shareholders, like helping themselves to generous retirement packages or the use of perks like corporate jets.
This is known as an agency problem—corporate managers are the shareholders’ agents within the firm, and the managers have a fiduciary duty to act in the shareholders’ best interest, but because the shareholders are not continually monitoring the behavior of managers, the managers may produce suboptimal returns for investors because of self-serving behaviors like enjoying expensive perks on the company’s dime. The worries raised by the agency theory become more acute as firms become larger and the temptation for managers to tap corporate resources for personal reasons—like backing a favorite political cause at shareholder expense—grows.
At the same time that statutory powers of corporations expanded, the Supreme Court also decided which constitutional rights could attach to the corporate form. The Supreme Court’s approach to the rights for corporations can be divided into two distinct strains of case law. Interestingly, while the Court has concluded that corporations are “persons” within the meaning of the Equal Protection Clause of the Fourteenth Amendment, the Court has been quite reticent to concede that corporations are “citizens” for the purpose of the Privileges and Immunities Clause.
Corporate Personhood Expands
There is a widely held misconception that Citizens United was the first case to create corporate personhood. This claim lands quite wide of the mark. First, the phrase “corporate personhood” does not appear in the opinion at all. Second, Citizens United did not grant corporations personhood. Corporations already had it.
Throughout American legal history, corporations have been near the first in line to claim various constitutional rights. This was true when it came to corporations’ claiming rights protecting private property and rights protecting the right to contract. The Supreme Court considered the property rights of corporations in Terrett v. Taylor, 13 U.S. 43 (1815). In Terrett, the Episcopal Church (a corporation) asserted property rights over certain land. The Supreme Court stated that the property rights were not disturbed by the Revolutionary War. And as the Supreme Court stated: “[T]he dissolution of the regal government no more destroyed the right to possess or enjoy this property than it did the right of any other corporation or individual to his or its own property[.]”
The Supreme Court in very early cases decided that corporations were covered by the Contract Clause of the Constitution. Article I of the Constitution says, “[n]o State shall . . . pass any . . . Law impairing the Obligation of Contracts. . . .” This means that a state, like New Hampshire, could not pass a law that interfered with a pre-existing contract between two parties. In the Dartmouth College case in 1819, the college (a corporation) claimed protection under the Constitution’s Contract Clause. The Supreme Court agreed that it applied, ruling even the Revolutionary War had not changed contractual rights for educational corporations like the college. Despite recognizing differences between corporations and actual citizens in the case, the Supreme Court ultimately held that New Hampshire had violated the Contracts Clause when the state essentially tried to take over the private college.
Equal Protection and Corporations
The first big leap in corporate personhood from holding mere property and contract rights to possessing more expansive rights was a claim that the Equal Protection Clause applied to corporations. One of the strangest twists in American constitutional law was the moment that corporations gained personhood under the Equal Protection Clause of the Fourteenth Amendment. It occurred in a case called Santa Clara County, and what was odd was that the Supreme Court did not really even decide the matter in the actual opinion. It only appeared in a footnote to the case.
Corporations were very aggressive in asserting Fourteenth Amendment rights after the Civil War. We have the likes of former U.S. Senator Roscoe Conkling to thank for the extension of Equal Protection to corporations. Conkling helped draft the Fourteenth Amendment. He argued as an expert witness in 1882 in San Mateo County v. Southern Pacific Rail Road that the Fourteenth Amendment is not limited to natural persons. He produced a journal that seemed to show that the Joint Congressional Committee that drafted the Fourteenth Amendment vacillated between using “citizen” and “person” and the drafters chose “person” specifically to include corporations. According to historians, Conkling was simply lying. Nonetheless, the Supreme Court embraced Conkling’s reading of the Fourteenth Amendment, not in the San Mateo County case, but rather in a footnote four years later in 1886 in Santa Clara County v. Southern Pacific Rail Road.
In the 1970s,Santa Clara was used to justify granting corporations the First Amendment right to spend unlimited corporate funds on ballot initiatives in a case called Bellotti. In Citizens United in 2010, when the Supreme Court held that political speech is “indispensable to decision making in a democracy, and this is no less true because the speech comes from a corporation,” they cited Bellotti. Hence, there’s direct line betweenSanta Clara and Citizens United. So, Citizens Unitedwas more of a culmination, and not the beginning, of the Supreme Court’s granting ever more expansive rights to corporate “persons.” But, of course, the Court continued to be petitioned by corporations that were emboldened by Citizens United. The troublesome conclusions of Citizens Unitedrecognizing political rights for corporations were extended in 2014 in Hobby Lobby, which recognized statutory religious rights for corporations too.
Not Citizens Under the Comity Clause
Article IV’s Privileges and Immunities Clause cases are one of the few areas of law where the Supreme Court has refused to extend the rights of humans to corporations. This clause of the Constitution reads: “[T]he Citizens of each State shall be entitled to all Privileges and Immunities of Citizens in the several States.” The point of the Privileges and Immunities Clause, also known as the Comity Clause, is to stop a given state from treating out-of-staters worse than it treats its own citizens. Alexander Hamilton, in Federalist No. 80, argued that the Comity Clause was “the basis of the union.” The Comity Clause helps safeguard the principle that Americans have the same rights no matter where they are within the United States.
In contradistinction to the Supreme Court’s approach under the Fourteenth Amendment of treating humans and corporations as functional equivalents, under the Comity Cause the Court has not extended corporations “citizenship.” The Supreme Court’s holding that corporations are not covered by the Comity Clause traces back to Bank of Augusta v. Earle, 38 U.S. 519, 587 (1839), where the Court concluded that “[t]he only rights [a corporation] can claim are the rights which are given to it in that character, and not the rights which belong to its members as citizens of a state.” (Also note that “corporations are neither persons nor partners, but artificial bodies politic, created by act of state, always ad hoc, and their franchises are granted for public good, of which they are the supposed instruments.”) This central holding has been reaffirmed repeatedly by the Supreme Court.
Courts have been willing to grant expansive rights to corporations, but they have not granted corporations and people identical rights. To this day, the Supreme Court has been of at least two minds when it comes to corporations—they are treated as “persons” who are covered by the Equal Protection Clause (and Contracts Clause among others), but they are excluded from the definition of “citizens” under the Comity Clause. One of the reasons why the anticorporate citizenship cases are so important is that they serve as a legal basis to challenge the direction of the probusiness Roberts Court.
What’s at Stake in Jesner v. Arab Bank
While the Supreme Court (outside of the Comity Clause exception) has given more corporate rights to corporations, especially in the areas of Equal Protection and the First Amendment, the Supreme Court has also puzzlingly excused corporations from certain human rights suits. This Supreme Court term, the Court may dig itself into an even bigger hole in its peculiar treatment of corporations. The case that affords this opportunity is Jesner v. Arab Bank. The plaintiffs in Jesnercould not be more sympathetic. They are the victims of suicide bombings and the families of victims killed in terrorist attacks. Their case was scheduled to be heard by the justices on October 11, 2017. The issue in the case is one that has been rattling around the U.S. legal system for years, and it is now on a roundtrip back to the Supreme Court. This issue is simply: Can corporations be sued for their human rights violations abroad in U.S. federal courts under the Alien Tort Statute?
If the issue in Jesnersounds familiar, it should. This was one of the questions in Nestle USA v. Doe in 2015. The Supreme Court denied cert. in the Nestle USA case in January 2016. It was also the issue in Kiobel v. Royal Dutch Petroleum in 2013 (Kiobel II). In Kiobel II, after two oral arguments, the Supreme Court punted on the core questions of corporate liability and instead decided that in “foreign cubed” cases (with a foreign plaintiff, a foreign defendant with underlying events occurring on foreign soil), that U.S. federal courts lack jurisdiction. This left open the issue of whether a corporation could be sued in a case that touched and concerned the United States. In Jesner, the Supreme Court gets another opportunity to clarify whether (and if) corporations can aid and abet human rights abuses outside the United States and get away scot-free.
In Jesner v. Arab Bank, the Arab Bank (a corporation) stands accused of, among other things, helping to finance terrorist attacks and incentivizing suicide bombings by paying funds to the families of so-called “martyrs” who carry out the bombings. In other words, the bank helped to pay the families of the perpetrators of the violence (not the families of their victims).
The way that the Arab Bank may get away with this alleged morally troubling behavior, even though it has a New York branch, is by reasserting the basic argument that was made in Nestle USA and Kiobel II: that the federal Alien Tort Statute was not intended to apply to corporations full stop. Given other cases in this area like Mohamad v. PLO, which held the word “individual” in the Torture Victim Protection Act means a natural person and does not impose any liability against organizations, the Arab Bank’s procorporate argument may well prevail.
There are multiple federal Circuit Courts which have shot down the argument that corporations are immune from suit under the Alien Tort Statute. The lone outlier is the Second Circuit, which decided in 2010 that corporations are excused from suit in Kiobel I. This is the case that was appealed to the Supreme Court and became Kiobel II.Jesner v. Arab Bank was litigated in the Second Circuit. One question in Jesnerwas what exactly did Kiobel II do to Kiobel I. So far in the litigation, Jesnerconcluded that Kiobel I and its conclusion that corporations can’t be sued in federal court using the Alien Tort Statute remained the controlling law of the Second Circuit.
So, what is the new Supreme Court likely to do in Jesner v. Arab Bank? No one can know for sure. If the Supreme Court cares to notice, most federal Circuit Courts have decided that liability for corporations under the Alien Tort Statute is appropriate, and the Second Circuit still stands alone in its aggressive reading of the law that corporations simply are not liable. It’s also possible that the justices could find the victims of suicide bombings more sympathetic than the widow in Kiobel IIwhose husband was executed in Nigeria after a widely decried show trial against African environmentalists who protested against Shell’s pollution of their land.
Conclusion
What we are likely to have at the conclusion of the Supreme Court term is corporations that are empowered to spend in American elections because of Bellottiand Citizens United; corporations that can make religious objections thanks to Hobby Lobby; and if Jesnerturns out as badly as I predict, corporations will be able to aid and abet human rights violations abroad with impunity. It’s not a pretty picture. If corporations are going to be treated as legal persons, they should have personal accountability too, especially for human rights abuses.
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Ciara Torres-Spelliscy is an associate professor of law and the Leroy Highbaugh Research Chair at Stetson University College of Law and a fellow at the Brennan Centerfor Justice at New York University School of Law. She is the author of Corporate Citizen? An Argument for the Separation of Corporation and State.
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https://www.amazon.com/Corporate-Citizen-Argument-Separation-Corporation/dp/1632847264
https://www.brennancenter.org/our-work/analysis-opinion/history-corporate-personhood
apr 2014 hist
In McCutcheon v. FEC, handed down last Wednesday, the Supreme Court built on the precedent of Citizens United by invalidating the federal aggregate contribution limit for individuals. But McCutcheon is not the only case that gives the Supreme Court chance to expand Citizens United’s reach this term.
In *Sebelius v. Hobby Lobby Stores*, the Supreme Court has to choose whether to extend the logic of 2010’s Citizens Unitedto allow a corporation to make a religious objection to a generally applicable law.
How we got to the point where a for-profit corporation – not a church mind you – can lay claim to religious rights is a bit complicated. It all goes back to a legal fiction known as corporate personhood.
Generally, corporate personhood allows companies to hold property, enter contracts, and to sue and be sued just like a human being. But of course some human rights make no sense for a corporation, like the right to marry, to parent a child, or to vote. As Professor Elizabeth Pollman explains when it comes to Constitutional rights for corporations there is a hodgepodge: “corporations enjoy Fourth Amendment safeguards against unreasonable regulatory searches, but do not have a Fifth Amendment privilege against self-incrimination.”
If you’re a fan of the Colbert Report, “corporate personhood” might sound familiar. Stephen Colbert got a well deserved Peabody Award for his work educating the public about campaign finance laws with his lawyer Trevor Potter. However, Mr. Colbert’s verbal tick of saying that Citizens United granted corporate personhood is a tad misleading.
Citizens United did not grant corporations personhood. Corporations already had it. As lawyer David Gans has documented, despite the fact that the U.S. Constitution never mentions corporations, corporate personhood has been slithering around American law for a very long time. The first big leap in corporate personhood from mere property rights to more expansive rights was a claim that the Equal Protection Clause applied to corporations.
The 14th Amendment, adopted after the Civil War in 1868 to grant emancipated slaves full citizenship, states, “No state shall ... deprive any person of life, liberty, or property without due process of law, nor deny to any person ... the equal protection of the laws.”
We have the likes of former U.S. Senator Roscoe Conkling to thank for the extension of Equal Protection to corporations. Conkling helped draft the 14th Amendment. He then left the Senate to become a lawyer. His Gilded Age law practice was going so swimmingly that Conkling turned down a seat on the Supreme Court not once, but twice.
Conkling argued to the Supreme Court in San Mateo County v. Southern Pacific Rail Road that the 14th Amendment is not limited to natural persons. In 1882, he produced a journal that seemed to show that the Joint Congressional Committee that drafted the amendment vacillated between using “citizen” and “person” and the drafters chose person specifically to cover corporations. According to historian Howard Jay Graham, “[t]his part of Conkling’s argument was a deliberate, brazen forgery.”
As Thom Hartmann notes the Supreme Court embraced Conkling’s reading of the 14th Amendment in a headnote in 1886 in *Santa Clara County v. Southern Pacific Rail Road*: “Before argument, Mr. Chief Justice Waite said: ‘The Court does not wish to hear argument on the question whether the provision in the Fourteenth Amendment to the Constitution which forbids a state to deny to any person within its jurisdiction the equal protection of the laws applies to these corporations. We are all of opinion that it does.’” This was not part of the formal opinion. But the damage was done. Later cases uncritically cited the headnote as if it had been part of the case.
Some Supreme Court Justices objected to the Santa Clara approach. Dissenting in *Wheeling Steel Corp.* in 1949 Justice William O. Douglas and Justice Hugo Black noted that the corporate personhood issue was not such an open and shut case: “[In Santa Clara] [t]here was no history, logic, or reason given to support that view. … [T]he purpose of the [14th] Amendment was to protect human rights-primarily the rights of a race which had just won its freedom.” Justices Douglas and Black thought the question of corporate personhood should be decided by the people, not the Supreme Court. But they could not convince their fellow Justices.
In the 1970s, Santa Clara was used to justify granting corporations the First Amendment right to spend unlimited corporate funds on ballot initiatives in a case called *Bellotti*. The Court relied on Santa Clara’s reading when it stated that “[i]t has been settled for almost a century that corporations are persons within the meaning of the Fourteenth Amendment.” Justice Rehnquist, in his dissent, questioned the wisdom of extending corporations political rights: “those properties, so beneficial in the economic sphere, pose special dangers in the political sphere.” Again Rehnquist could not convince his brethren.
In *Citizens United*, when the Supreme Court held that political speech is “indispensable to decision making in a democracy, and this is no less true because the speech comes from a corporation,” they cited Bellotti. Thus it’s only a hop, skip and a jump from Santa Clara to Citizens United.
In Sebelius v. Hobby Lobby Stores, the store chain is claiming that the corporation (and not just its proprietors) has a religious objection to providing certain types of birth control for its workers as required by the Affordable Care Act. Thus, the Court is contemplating expanding corporate personhood to a new logical extreme: First Amendment religious rights. It’s no surprise that Hobby Lobby’s brief relies on Bellotti and Citizens United.
There are absurdities that flow from granting legal fictions Constitutional rights that were intended for humans. Corporations don’t have minds, and without one it is hard to see how a corporation “thinks” about any political issue du jour from gay rights to the budget deficit. Without a soul, it’s hard to conceptualize how a corporation could “believe” in anything whether it is transubstantiation of communion or the morality of birth control. But here we go again. A corporation makes a Constitutional claim to the righteousness of their legal position. The question is will the Justices fall for it?
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Corporate citizen? Torres-Spelliscy 2016
Prologue p3
start career corp law [saw CU argued, watched democ die, laughs?], but saw getting rights and dumping responsibility. esp 1st Amend; bad on green and hu rights; CJ Warren Burger said should be balance between;
Part I
Are Corporations Citizens?
Chapter 1 · The Year the World Changed 11
2010 inflection pt , punct equilibriump11 unlimited corp $ in fed elections; in principle/theory still had to disclose, but in effect not; ruled CU org had to disclose, but then FEC ruled it was a press entity so no p11.
Dodd Frank and ACA big bills, but watered down by corp lobby; some dodd-fr challenged based on 1st amend;
also 2010 Royal Dutch Shell Nigeria Ken Sara Wiwa; also arg 2x, but side w/ chev b/c of extra-territory 13; OTOH 2010 Maryland 1st B Corp; CoC and trade Assoc lots of dark $ but we'll never know b/c of CU; (but sometimes slips out or discovered in courts eg ATI; bankruptcy ct; Jonathan Frieman [sic] HOV lane 15 (papers w/ him 10 years waiting
Law is inconsistent and in K flux; cf Wm Greider bk "who will tell ppl "; Ch Justice Leo Strine DE scotus law rev: corps not ppl 18;
3 areas: Comm'l Sp
2 Politics
3 Religion
some lower ct expand corp person, 2 of 3 judges (en banc?) can change legal hist 19;
Brandeis "s; huge maj of Ams want to limit corp pol $
Chapter 2 · Yes, Virginia, Corporations Are People, But Not Citizens 23
race to bot states; DE won, 2nd smallest but 2 MILLION/YEAR [MORE THAN PPL] p28; CJ Roberts 2005-? "corp ct” [2016]
[est’b by Pope Innocent IV 1243-54 w/ legal training?; 1781-91 only 32 chaRTERS;
Brandeis' famous dissent Liggett 1933;" draws on historical limits; until 1875 limited in years p 27. by 1910 economy dominated by corps w/ 1m$ capital; fears of monopoly [teddy?]; ALSO EXPAND TO "ANY LAWFUL PURPOSE" ; ownership separate from control and shareholders dispersed and have tiny %; Joseph Stiglitz: corps work for CEO not stakeholders, agy problem; Bierce" an ingenious device for obtaining indiv profit w/o indiv responsibility" 30
schizo on case law: 1st and 14th expand (1st not much used until 70's]; BUT Art IV Privs and Immunities, LIMITS; strong personhood in fmr and weak (ie real distinction ) in latter 30; two Due Process Clauses 14th 5th and also 2 priv and imm clauses;
corps always litigious; Dartmouth 1819Terrett, follow Brit Common Law Sutton Hospital 1612 (no soul, fealty , can't swear or appear; echoed by CJ John Marshall Bank of US v Deveraux; so original stance NOT persons p35; later decided can sue and be sued, but strangest was SCC 14th; Equal Protection Roscoe Conkling; expert witness in San Mateo 1882; Howard Jay Graham says lying (corrob by ---); 1897 cited as precedent in Gulf C and SF Ry co V Ellis 1897; Hugo Black dissent 1938 p 37; again w/ WO Douglas [fmr head FEC] 1949 Wheeling Steel Corp "; SCC cited in Bellotti (settled law for century 14th corp person). CU cited Bellotti [sic]
ART IV COMMITY CLAUSE alex Hamilton says basis for union; badly applied in Dred Scott sic; limit goes back to 1839 Bank of Agusta v Earle, corps have no rights of citizens of a state; 1869 Paul v Va no ct grant corp person b/c too much power (just mos after 14th paSSED]; REAFFIRMED IN 1888 Pembina Mining; Grosjean 1936; corps exploit waffle/ambiguity/schizo 44.
Chapter 3 · The Price of the Ticket 45
campaign finance law; polls high; Pres J Carter; megaphone; 39 states at least some judge elected; every dollar literally makes more likely pro-biz rulings 49(kang and shepard];
1905 Frick: SOB didn't stay bought of Teddy; Tillman Act 1907 no corp $ candidates fed office; Publicity Act 1910 requires parties disclose spending 51; Mont WA Clark had to quit senate in 1900 b/c bought a seat (one of richest in US, copper?] "never bought a man not for sale" copper dome on state capitol; --> 17th amend and Montana Corrupt Practices Act 1912 ;Teapot Dome --> 1925 Fed Corr P Act; must report contrib aND EXPEND BUT NEVER ENFORCED; no progress till Watergate; 500 corps gave $ [21 pled guilty, almost 1 mil$]
, 1977 FCPA; after Enron McCain-F and Sarbaines-Oxley SOX; Wm Brennan req PAC vs corp bank acct'; Austin and McConnell restrict but ~ CU;
corp lobbying: 87% of 1.1B$ corp pol activity s&p 500 went to lobbying p66; this grew in the 70's 80's to counter grassroots activists? 67 Revolving door; AT&T had trouble finding a room all its lobbyists could fit;Princeton studyp71;FEC Ravel: we’ll never have watergate again b/c press does not have $ to find and FEC not looking?! 71;
Part II
The Expansion of Corporate Rights
Chapter 4 · Now a Word from Our Sponsors 75
corps seek Absolute 1st amend rights; Comm'l speech had no protections till 70's, now displace regulations :{75; intermediate scrutiny thus wide range; 1976 Va State Bd of Pharma v Va citizens consumer cncl, Rehnquist dissent " 79 -->Lochner;
Central Hudson priviledge free flow of info but “hunting license for judges who dislike regulations"}:
compelled speech (cigarette graphic warning? corps spend 12.5B$ in 2006 RJ Reynolds 2012 DC circuit; Judge Rogers dissent) and compelled silence wwII Jehovah's Witness?
Conflict minerals NAM CoC; Dodd Frank (the minerals aren’t conflicted?!) API v SEC; Cass Sustein 91
Data collection as Speech; Sorell Vt law ~ 1st Amend; Kennedy wrote for 6-3 majority; erase distinction betw comm'l and pol sp; Kagan, Breyer and Ginsburg dissent; could apply to all data; Breyer: Pandora's box --> pre-Lochner;
---
Chapter 5 · This Politician Was Brought to You By . . . 101
2009 18 corps had 36% of all wealth 1.5 Trill$; 18 corps had 500B$;J Powell sneaky in Bellotti protect speech not spkr,Rehnquist dissent; Memo;
Buckley Valeo (8 magic words) plus Bellotti--> CU
BCRA Bipart [mccain-feingold?] electioneering communications, upheld by McConnell but ~ 7 yrs later in 2010; Acting Solic gen'l Malcolm Stewart messed up saying applied to 500 pg book hypo; [Kagan walked back 2nd round] what CU did vs did not p 114; key change is allowed corp $ for indep expenditures [ 501c4?] and electioneering comm = pol ads; pretended to empower "disfavored assoc of cits" while rich ppl can spend as much as they want? 115 Justice JP Stevens passionate dissent " 115; later bk same opinion;Lessig 500% increase in Neg ads 117; depress turnout; ~ BO in 1st SOU ~, foreign $, Alito "not true" [russian $ yes jesse benton at least , rudy pals?]
Chapter 6 · Forty Pieces of Silver 125
ed thurlow “no body to be kicked"
justice Nelson Hobby Lobby invention out of whole cloth
bkgd: Griswold V Conn married contraception, Eisenstadt v Baird 1x ppl --> 1973 Roe, 2010 ACA (NFIB v Sebelius) Relig Freedom restor Act 1993 peyote 1st Amend not protected, reaction to Smith case; HL corp conscience claims 1st time (fail before?); right to object to the corp not to families that own closely held 129; not in compliance w/ ACA thus ~ "any lawful purpose" 130
also odd that FDA did not classify as abortifacients (the plaintiffs just believe they are?); some ATTEMPTS TO LIMIT B/C COULD EXPAND TO TAXES ETC; not practice of faith in home or church but your ability to impose on others 133; dissent RBG; expanded in Wheaton College;
Part III
Fewer Corporate Responsibilities
In 30's Berle and Means concerned corps would rival power of states; "dominant form of social organization" 140; Brandeis "curse of bigness"
Chapter 7 · Avoiding the Taxman 143
TJ: "Merchants have no country"
taxes are test of allegiance
local tax breaks rarely produce much in terms of jobs (bail for better deal); NASCAR has own tax break;corps can write off legal fees when do crimes 147;
Int'l BK Canada tim horton; Double Irish with Dutch Sandwich; Apple avoided 9B$ in taxes in 2012; OECD says 100-240B$/yr. GGl Dutch 99.8%; many #; 2014 Farm Bill 50% for food aid on US ships;
Chapter 8 · Get Out of Jail Free 157
white collar > normal crime $; many stats, pentagon contractors; 28K people lost jobs after Arthur Anderson post Enron, so Holder Memo; too big to fail , jail, eventually regulate[FANG]
Chapter 9 · Death and Chocolate 171
Doe v Unocal (Burma Total France; rape extrajudical killing, military burn villages; Alien Tort Statue;
Kiobel v Royal Dutch/Shell Nigeria Ken Saro Wiwa jrnlist and others hanged; [2012 Mohammed v Palestinan Authority Torture Victims Protection ACT APPLIED ONLY TO NATURAL PERSONS]; NONVIOLeNT PROTESTORS; wIWA SETTLE 15M$
next year Daimler hu rights violations Argentina CA case; during dirty war vs union ppl? only 2.4% of sales, thus no (but still billions of $, Sotomayor; 9th circuit Nestle case slavery not OK and not off hook b/c corp; en banc denied and scotus denied cert? 190
Chapter 10 · Fracturing Politics 193 FRACKING
Robert Monk: corps "externalizing machines" 195 once ran coal co , cheap only if ignore rx effects;"death machine";
PUCregulatory capture when only corps show up for mtgs, tough b/c very technical and hard for regular people to grasp; even tougher when info secret proprietary p199 Colo nurse treated man who spill frack fluids on self (fumes from boots?) she had mult organ fail and nearly died, Cathy Behr; ZetaFlow co wd not tell Dr what was in fluid 200; data sheet 2 proprietary compounds; 14% sheets complete, ½ of products less than 1% could be determined 201; Hallib said reveal wd be unconstitutional TAKING; told Colo if forced to reveal wd leave state 202; ~ scotus precedent: 2015 Horne v Dept Agr upheld 1984 Ruckleshaus NOT taking.
When facts not on corp side, shift to disinfo PR campaign eg AGW; tobacco doubt science playbook;
Reg capture MMS; ALEC PA Dr gag rule frack; state must step up when fed fail [but colo state frack ~ local ords]
Part IV
The Push Back
Chapter 11 · Shareholders Remember They Own the Joint 215
1950's Bayard Rustin Greyhound bus, ~ SEC; but 1970 DC circuit Dow : Medical Comm for Hu Rights v SEC napalm VN forced SEC to change rule on pol issues;
CSR, eg carbon disclosure Pjt; dark $ (often thru trade assoc Coc) makes it hard to hold corps acct and eg boycott; Justice Kennedy at Harv 2015 still defend CU b/c we live in cyber age we do not need to wait for 3 mos for report, but instant reports he refers to do not exist 227.
superPACs stats, much is energy corps; after CU shareholders pressed for more transparency [did not get it?] sallie mae, lorillard and valero?! but whack a mole problem, when disclosure req, just gets rerouted; Qualcomm and Oracle CoC;
Divestment Apartheid (not buying typewriters from IBM by local and state gov more effective?); univ divest limited (this has chaNGED; also public sector union pensions]
Chapter 12 · There’s an App for That 243 [google and apple pull navalny app/caved 921]
BOYCOTTS TRAD HARD B/C LOTS OF WORK, CUSTOMERS DISPERsed; Nestle infant formula; Buycott, Buypartisan and 2nd vote (consrv), eg Target
Color of Change got many defectors from ALEC after Trayvon SYG
Chapter 13 · The End of the Bottom Line 257
B Corps
Bucky: "You never change things by fighting the existing reality. To change something, build a new model that makes the existing model obsolete" 257
ford pinto 11$ cost-benefit analysis; Ray Anderson Innerface carpets
B Lab (does certification too, tougher? 80 0f 200, B&J, Green Mtn Power); 2010 MD 1st state, 2011 NY and CA biggest; 2013 DE, 30 plus DC; unan approve in Utah legis? pretty vague definition? artistic? charitable...but must have metrics , facts and analysis (but not 3rd party audit, no disclosure req). 2015 3K B corps (some subsidiary?)
Chapter 14 · Changing the Rules of the Game
good "s; after CU a number of states tightened up law (but don't affect fed?!) limits of corp coffee and 2 yr rev dr; public funding campaigns
follow UK/ EU shareholder consent on Pol $.
FEC add 7th comm), FCC and SEC IRS on C4
Richard Posner U chic [180 on voter suppress]
Mo scotus Justice James Nelson scathing on CU (ruled cd keep ban after CU) "auction house for Freidmanian corporatists" 298 "souless creations " of gov't
Comity Clause
Const Amend: 2nd circuit judge calabresi ex dean yale law says CU will be overturned by scotus or 28th 293
J John P Stevens book Six Amendments favors 28th; 78% think ~; 16 states voted for 28th 293; Mont & Colo vote 75%
fear --> too big to regulate
End sum
Thank you to Professors Elizabeth Pollman, Atiba Ellis, Tamara Piety, Jordan Singer, Ellen Podgor, Glynn Torres-Spelliscy, as well as attorneys Shane Spelliscy, Jeffrey D. Clements, Ron
Fein, Heather McCready, Elizabeth Kennedy, and Jack Ucciferri for reading
===
https://www.acslaw.org/expertforum/citizens-united-made-my-career/
Hear more from this author in the video recording of ACS's January 17 panel discussion: Revisiting Campaign Finance Regulation 10 Years After *Citizens United*.
Citizens United made my career. I would have preferred a healthy democracy. When I gave my job talks to become a professor of law, the topic was Citizens United. Since 2010, I have written 11 law review articles and 2 books (Corporate Citizen and Political Brands) about Citizens United and its aftermath. I’ve been invited to talk about Citizens United over 50 times around the nation including by ACS on January 16, 2020. Those who found it objectionable the day it was decided are still dismayed by it a decade later and still want to undo it or mitigate it.
Twelve years ago I was a junior lawyer at the Brennan Center when the Supreme Court took the *Citizens United v. FEC* case. I went out on maternity leave in 2008. When I came back to work, Citizens United was scheduled for re-argument at the Supreme Court. I spent the summer of 2009 helping to corral amici to write Supreme Court briefs and rushing home on the subway to relieve my childcare provider. But looking back I’m glad I was able to work on the amici effort. A brief from the Sunlight Foundation argued for transparency. The final opinion written by Justice Kennedy adopted many of the Sunlight Foundation’s arguments.
I attended the re-argument of Citizens United in the gallery of the Supreme Court with my fellow lawyers from the Brennan Center. I remember feeling like I was watching democracy die among high pillars and velvet drapes. Ted Olson said something lame. People laughed. Justice Scalia said something even more lame. People laughed harder. Elena Kagan, the solicitor general, backtracked on an absurd position that her predecessor, the acting solicitor general, had made in the first oral argument. People laughed again. By the time Seth Waxman got up to add a few points about Elihu Root, the oxygen had already left the room. The fix was in. It was a forgone conclusion that the Supreme Court was about to tear up decades if not centuries of laws that had kept corporations out of politics in federal elections and over twenty state elections. All we had to do between September 9, 2009, and January 21, 2010, was wait for the guillotine to fall.
While the case was pending at the Supreme Court for two years, I wrote a white paper about the worst-case scenario of what the Supreme Court could do in Citizens United. When the case came out, all I had to change were the verb tenses. The Supreme Court’s *Citizens United* decision gave all corporations the right to spend unlimited amounts of money buying unlimited political ads in all Americans elections henceforth.
Staffers in Congress noticed my white paper and invited me to testify. I told members of Congress that Citizens United presented two big problems for investors: a lack of transparency and a lack of consent. The transparency problem is now known under the umbrella of “dark money” which cannot be traced back to its original source, whether that source is human or corporate. The consent problem is that unlike shareholders in the UK, shareholders in the US are not given a chance to vote on corporate political spending.
Looking back at the decade between 2010 and 2020, I see that there were many ways for corporations to damage democracy and democratic norms—not all of which are traceable to Citizens United, but many which are.
The greed of corporations often makes them devalue the very people who work for them and corporations use their political clout to get their way. For example, corporate interests have worked to roll back increases in the minimum wage including urging the DC City Council to repeal an initiative by voters to increase the subminimum wage for tipped workers. Voters made it clear in June 2018 they wanted the higher wage. As *Think Progress* reported at the time, “the D.C. Restaurant Industry and its lobbyists have contributed more than $236,000 to the campaigns of current councilmembers and D.C. Mayor…” Businesses, including the National Restaurant Association, had the muscle to overrule their votes on wages by October 2018. The National Restaurant Association has also voiced its opposition to raising the federal minimum wage.
The fight over DC’s minimum wage wasn’t the only local election where corporations threw their weight around. In 2014, Chevron tried to buy a mayoralty and city council seats in Richmond, California. But this ended up backfiring when Chevron’s political spending became a national story and the Chevron-backed candidates lost.
Corporations also tried to put a thumb on the scale of justice in state judicial elections and empirical data from Professor Joanna Sheperd showed disturbingly: “There is a significant relationship between business group contributions to state supreme court justices and the voting of those justices in cases involving business matters. The more campaign contributions from business interests justices receive, the more likely they are to vote for business litigants appearing before them in court.”
Then there is the tax dodging. From 2010-2020 Apple was the poster child for dodging U.S. taxes. But Apple wasn’t alone. Corporations lobbied heavily for the Trump tax cuts. According to a study by ITEP, 60 companies paid zero taxes in 2018. Not surprisingly, the big winner from the Trump tax cuts were corporations. The last cut in the corporate tax rate had been in 1993. For a group that wants to have the rights of U.S. citizens, they don’t appear ready to do what every tax paying person does: chip in.
Business interests have also worked to undo campaign finance reforms that voters wanted. In November 2016, North Dakota voters voted for an initiative to provide public financing in elections. But the state legislature repealed the measure and the governor signed the repeal into law by February 2017. The opponents of this change included American for Prosperity, a group linked to Charles Koch of the Koch Brothers and Koch industries.
And then there’s what I can only call the “Facebook problem.” Facebook is number 57 on the Fortune 500. I’ve seen computer scientists at DEF CON to professors at the Association of American Law Schools lament the “Facebook problem.” And people characterize the problem in a variety of ways ranging from the way that Facebook allows advertisers to target subsets of the population, to the ways that Facebook allows for manipulation of its users, to Facebook’s disregard for users’ privacy. But all of these issues may be outweighed by the decision by Facebook’s founder Mark Zuckerburg to allow lies in political ads during the 2020 election. This can only hurt democratic discourse.
Finally, as I detail in my book Political Brands, the Trump Organization brought a whole new level of corporate conflicts of interest into the White House including ongoing violations of the domestic and foreign emoluments clauses. If the original fear was corporate money flowing into the political system, the Trump Organization has shown that political money flowing into corporations can be just as problematic.
Could all of this have happened without Citizens United? Possibly. It’s hard to know the counterfactual. But Citizens United seemed to encourage corporations to be aggressive in politics and to be brazen about conflicts of interest that benefited corporations over workers, customers, investors, and citizens. After Citizens United, politicians always have to fear that if they go against corporate interests, that they will reap the whirlwind of corporate wrath in the next election.
Citizens United made my career. I wish it had never happened.
===
no corp person?
https://www.c-span.org/person/?ciaratorresspelliscy
===
https://www.brennancenter.org/about/staff/ciara-torres-spelliscy
Ciara Torres-Spelliscy
Fellow
@ProfCiara
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Ciara Torres-Spelliscy is a Brennan Center fellow and professor of law at Stetson University College of Law, where she teaches courses in election law, corporate governance, business entities, and constitutional law. Prior to joining Stetson’s faculty, Torres-Spelliscy was counsel in the Brennan Center’s Democracy Program, where she provided guidance on money in politics and the judiciary to state and federal lawmakers. She was previously an associate at Arnold & Porter LLP and a staffer for Senator Richard Durbin. Torres-Spelliscy has testified before Congress and state and local legislative bodies as an expert on campaign finance reform. She has also helped draft legislation and Supreme Court briefs.
Torres-Spelliscy specializes in campaign finance law and constitutional law and has presented at symposia across the United States and abroad. In 2016 she addressed the Federal Election Commission at a forum on dark and foreign money in U.S. elections.
Torres-Spelliscy is the author of Political Brands and Corporate Citizen? An Argument for the Separation of Corporation and State. Her work has been published in the New York Times, New York Law Journal, Slate, the Los Angeles Times, and U.S. News & World Report, among others.
AREAS OF EXPERTISE:
Reform Money in Politics
Influence of Big Money
PROJECTS:
Enforcement & the FEC
Dark Money
Super PACs & Coordination
CONTACT:
Julian Brookes
Media Contact
brookesj@brennan.law.nyu.edu
646-292-8376
Featured Work
FELLOWS
Dominion Voting’s Libel Suits, the First Amendment, and Actual Malice
If the Supreme Court gets involved, the defamation cases against Fox News and One America News could end up changing longstanding rules relating to the press.
March 28, 2022
Ciara Torres Spelliscy
FELLOWS
21 Things We Learned About Money in Politics in 2021
December 6, 2021 Ciara Torres-Spelliscy
21. The funding of ballot measures continued to be a smorgasbord of unlimited money.
A federal judge blocked a new Florida new law (S.B. 1890) that imposed a $3,000 contribution limit to ballot initiative campaigns. And the Federal Election Commission decided that foreign money can be spent in ballot measure fights. This foreign-money loophole would be closed by Sen. Kirsten Gillibrand’s (D-NY) bill, the Stop Foreign Interference in Ballot Measures Act, or Sen. Sheldon Whitehouse’s (D-RI) DISCLOSE Act.
20. Once a big political spender, the National Rifle Association had a tough year.
The NRA declared bankruptcy and then tried to move to Texas, likely in an effort to dodge enforcement actions that were proceeding against it from the New York State attorney general. A bankruptcy judge dismissed the case, declaring that it was not filled in good faith. And to top that off, Giffords, the gun-control group founded by former Arizona congresswoman Gabby Giffords, filed a federal lawsuit accusing the NRA of violating campaign finance laws since 2014.
19. The rich always throw the new boss a fete, no matter the party.
President Joe Biden’s inaugural raised $61 million, which was provided by 18 billionaires and many corporate donors, among others. Many of these corporate donors like Pfizer, AT&T, and Boeing had previously given to President Donald Trump’s inaugural in 2017, which incidentally is still under investigation by the D.C. attorney general.
18. Some campaign treasurers need to improve their math skills.
Federal candidates report their fundraising and spending to the FEC, but in some cases, the numbers did not add up. Rep. Jim Jordan’s (R-OH) campaign faced questions from the FEC over accounting discrepancies that exceed $100,000.
17. Campaign funds are not personal piggy banks.
You might think after the prosecutions of former congressmen Duncan Hunter (R-CA) and Jesse Jackson Jr. (D-IL) for personal use of campaign funds, the message would have sunk in by now that federal candidates cannot use campaign money for lifestyle perks. But in August, the FEC had to ask Rep. Lauren Boebert (R-CO) to explain the apparent personal use of her campaign funds to allegedly pay for rent and utilities. And demonstrating how serious personal use of campaign funds is, in September, Milwaukee City Council member Chantia Lewis, a Democratic candidate for U.S. Senate, was charged with a series of campaign finance violations for allegedly using donations and improper travel reimbursements on more than $21,000 in car payments, family trips, and a worship conference. Also in September, former Massachusetts state representative David M. Nangle (D) was sentenced for illegally using campaign funds to pay for his personal expenses.
16. Big offices still cost big money.
There was at least $84 million spent in the failed effort to recall California Gov. Gavin Newsom (D). At least $76 million was spent in the New Jersey governor’s race where the Democratic incumbent, Phil Murphy, raised more money and won reelection. But the Virginia governor’s race took the cake, costing at least $148 million. Republican Glenn Youngkin raised slightly more than Democrat Terry McAuliffe and won slightly more votes to take the governor’s mansion.
15. The worst places got worse.
Florida, which already wasn’t great in terms of money in politics, got rid of low local contribution limits for localities by passing a state law that displaced good local campaign finance ordinances.
14. The fallout from Russian interference in the 2016 election is still generating criminal cases.
The Justice Department charged Roy Wead of Florida, an advisor to multiple presidential campaigns, and Jesse Benton of Kentucky, who previously worked as a campaign manager for two U.S. Senate campaigns and one presidential campaign, with conspiracy to solicit an illegal campaign contribution by a Russian foreign national.
13. Not every campaign finance matter from the 2016 election was resolved.
Time ran out on the statute of limitations for charging Donald Trump for the hush fund payments to Stormy Daniels that landed Trump lawyer Michael Cohen in jail. October 27 was the five-year anniversary of when Trump had Cohen secretly pay hush money to the porn star.
12. Sen. Ted Cruz (R-TX) is doing his best to crush campaign finance reform.
:{:{}:
The Supreme Court agreed to hear *FEC v. Ted Cruz for Senate*. The question in the case is whether the federal loan-repayment limit for candidates violates the Free Speech Clause of the First Amendment. The case gives the Roberts Supreme Court another chance to further hobble campaign finance law, which groups like the Brennan Center have advocated against.}:
11. Some campaign expenditures raise more eyebrows than others.
Rep. Matt Gaetz (R-FL) has been under scrutiny ever since a close associate, Joel Greenberg, was arrested and began cooperating with investigators who are looking into an alleged sex trafficking ring. Those looking at Gaetz’s campaign expenditures have discovered that $825,000 has gone to a PR firm called Logan Circle Group, $50,000 went to legal fees to the same lawyer who represented Jeffrey Epstein, and $20,000 went to a company run by Roger Stone.
10. It’s not all bad news: small donors made a splash in the New York City elections.
2021 was the year for NYC elections and small donors gave record amounts to candidates for City Council and citywide offices like mayor or comptroller. The election also resulted in the most diverse City Council ever, better reflecting the complexity of New York City.
9. In more good news, shareholders got a new useful tool to respond to corporate political spending.
The new administration brought in new leadership across the federal government. The Securities and Exchange Commission changed the rules for shareholder proposals. This change makes it easier for shareholders to raise social issues like corporate political spending or lobbying expenditures for a vote on corporate proxies, which are tracked by groups like the Center for Political Accountability and Sustainable Investments Institute.
8. Contribution limits are more vulnerable.
Following a Supreme Court decision in *Thompson v. Hebdon*, the Ninth Circuit Court of Appeals ruled that some of Alaska’s campaign limits violate the First Amendment. The restrictions included a $500 per year contribution limit from individuals to candidates, a $500 limit from individuals to election-related groups, and a $3,000 cap from out-of-state contributors to candidates. However, the Ninth Circuit did uphold the $5,000 limit from a political party to a candidate.
7. Campaign donations can end up in the hands of criminal defense attorneys.
The RNC has agreed to pay some of Donald Trump’s legal fees related to the criminal investigations into the Trump Organization by the offices of the Manhattan district attorney and New York State attorney general. This isn’t new, as Trump had the RNC foot legal bills for the Russia investigation. But this is different because the legal problems at issue at the Trump Organization were allegedly created before he was a federal candidate.
6. There were pardons for infamous campaigners.
Elliott Broidy, who once served as finance chairman of the Republican National Committee, was pardoned by President Trump in his last days in office. Broidy had been charged as acting as an unregistered foreign agent who tried to interfere in a federal investigation into the 1MDB Malaysian state fund fraud. He pleaded guilty. Broidy was pardoned the same day that Trump pardoned his former 2016 campaign manager, Stephen Bannon, who was charged with bilking supporters of an effort to build a wall along the southern border.
5. Donors should beware of the pre-checked box.
In April, the *New York Times* exposed the Trump campaign’s dodgy 2020 practice of pre-checking boxes on its campaign contribution solicitation pages, signing donors up for recurrent donations without them realizing it. Even after this was roundly criticized, Trump’s pre-checked box scam continued and was expanded by other Republicans. As a result of his fundraising efforts, Trump has over $100 million in his political war chest.
4. Donors also need to beware of straight up scammers.
It’s a jungle out there. As the price tag for elections continues to rise, so too does the opportunity for fraudsters. The Justice Department arrested three men — Matthew Nelson Tunstall, Robert Reyes Jr., and Kyle George Davies — for running scam PACs that allegedly tricked donors of $35 million.
3. Foreign money is still illegal in American elections.
Lev Parnas (a former associate of Rudy Giuliani) was convicted of violating federal campaign finance laws for, among other things, hiding the foreign source of money that he and his associate Igor Fruman gave to several American politicians, including Florida Gov. Ron DeSantis (R) and Sen. Rick Scott (D-FL).
2. Eventually bribery charges catch up to even the most powerful.
In June, the Ohio House expelled State Rep. Larry Householder (R), who stands accused in a federal indictment of accepting bribes from First Energy in exchange for actions on legislation when he was the speaker of the Ohio House.
1. Corporate donors keep giving despite the January 6 insurrection.
The attack in the Capitol was bad enough that some corporations said they would suspend their donations to the sedition caucus. But a few months later, most of the corporations who made such pledges found ways to give money to the same people either directly or indirectly through intermediaries like leadership PACS. Hopefully in the new year, corporations will back democracy more robustly, including by supporting the passage of the Freedom to Vote Act and John R. Lewis Voting Rights Advancement Act. Well, a girl can dream.
---
More Shareholders Seek Transparency on Corporate Political Spending and Climate Change
June 16, 2021 Ciara Torres-Spelliscy
FELLOWS
How Matt Gaetz’s Legal Problems Could Lead to Campaign Finance Violations
May 20, 2021 Ciara Torres-Spelliscy
FELLOWS
Beware of ‘Scam PACs’ and PACs that Scam
May 11, 2021 Ciara Torres-Spelliscy
FELLOWS
The Supreme Court’s Looming Dark Money Decision
April 23, 2021 Ciara Torres-Spelliscy
FELLOWS
Georgia’s New Voter Suppression Law and Corporate Support
April 3, 2021 Ciara Torres-Spelliscy
FELLOWS
How the Biden Administration Can Increase Transparency for Corporate Political Spending
March 19, 2021 Ciara Torres-Spelliscy
FELLOWS
Supreme Court Ducks an Opportunity on Trump Emoluments Cases
February 19, 2021 Ciara Torres-Spelliscy
FELLOWS
With Second Impeachment, Trump Finds Sudden Respect for the Constitution
February 8, 2021 Ciara Torres-Spelliscy...
===
review
2016
torres-Spelliscy’s Corporate Citizen?An Argument for the Separation of Corporation and State, analyzes the trail of legal cases that led to the 2010 Supreme Court decision in :{*Citizens United*:(style="margin:0px;padding:0px;border:0px;outline:0px;vertical-align:baseline;background-image:initial;background-position:0px 0px;background-size:initial;background-repeat:initial;background-attachment:initial;background-origin:initial;background-clip:initial"):}:, as corporations won rights originally reserved for citizens. Not only are they winning the rights of real persons, but they are avoiding the responsibilities of citizenship… like paying taxes.
Before reading the book, I vaguely knew one of the first key decisions stemmed from the Fourteenth Amendment to the U.S. Constitution, which says,
[n]o state shall… deprive any person of life, liberty or property without due process of law, not deny to any person… the equal protection of the laws.
Known as the Equal Protection Clause, the amendment was meant to secure the rights emancipated slaves. However, Roscoe Conkling argued, based on his role as a congressman in framing the Fourteenth Amendment, that Congress had vacillated between the words “citizen” and “person,” choosing person specifically to include corporations.
This important distinction didn’t appear in the actual opinion rendered in Santa Clara County v. Southern Pacific Rail Road, as I had always assumed, but instead in a head-note about an argument the Court did not wish to hear.
Conkling’s legal practice went so well he turned down two offers of a seat on the Supreme Court. :{*Santa Clara*:(style="margin:0px;padding:0px;border:0px;outline:0px;vertical-align:baseline;background-image:initial;background-position:0px 0px;background-size:initial;background-repeat:initial;background-attachment:initial;background-origin:initial;background-clip:initial"):}: begat :{*Bellotti*}: in 1978, allowing corporations to spend unlimited corporate funds on ballot initiatives, which begat Citizens United in 2010 granting even more expansive rights to corporations.
On the flip-side, Torres-Spelliscy traces how the Comity Clause has evolved to affirm that corporations are not citizens. That distinction may be the lever for a future Court revisiting and overturning Citizens United and Bellotti.
Torres-Spelliscy does an excellent job of tracing the impact of money on politics. Following huge political scandals there is often a push to drive money out through legal statutes, but between those events is a steady drip of corporate challenges through case law winning more and more rights for corporations until we now face a situation where the political has, for all practical purposes, become subordinate to the economic.
We have now reached the point where 158 families, along with the corporations they own or control, contributed $176 million to the first phase of the 2016 Campaign. Yes, reading the book will help you realize it is worse than you thought. [I got my own deep appreciation of corporate power when I found myself writing hundreds of environmental laws in California with the able assistance of corporate lobbyists. That’s when I started this blog.]
:{*Hobby Lobby*:(style="margin:0px;padding:0px;border:0px;outline:0px;vertical-align:baseline;background:0px 0px"):}: turned religious rights on it head and appears as the current pinnacle of placing corporate rights above those of people but Torres-Spelliscy also delves into the evolution of reduced responsibilities, such as paying taxes.
“Taxes are what we pay for a civilized society,” as Justice Holmes wrote. Its no wonder some of us feel our country is slipping into barbarism. The book goes on to discuss how up to $240 billion a year is lost to tax coffers, as money is moved internationally.
Torres-Spelliscy: Recommendations
Thankfully, Torres-Spelliscy not only takes us down the path of incremental legal interpretations that have led to our current nightmare, she also discusses new forms of resistance. Boycotts, phone applications, consumer groups, benefit corporations, and more – all offer some promise.
Torres-Spelliscy makes a large number of recommendations. Here are just a few:
- Regulations: The IRS, the Federal Elections Commission, the Federal Communications Commission the SEC and others could address aspects of dark-money problem, including barring foreign corporations (which needs defined) from spending in U.S. elections.
- Shareholders: Demand corporate transparency about political spending.
- Consumers: Use phone apps to check on their political activities before patronizing corporations.
- Action by voters: Publicly funded election laws and/or severe restrictions on contributions could broaden who officials are accountable to.
What I found most helpful from Torres-Spelliscy was her insight concerning the need for the Supreme Court to look again the its own jurisprudence on the Comity Clause to “bring back a sense of proportion to corporate rights.” After reading the book, I’m convinced one liberal appointment to the Supreme Court could make all the difference with respect to Citizens United and Hobby Lobby. That won’t make real citizens the center American democracy but it would certainly be a start.
My Extra Two Cents
As far as I’m concerned, Torres-Spelliscy is spot on with the following sentence:
A key aspect of why empowering corporations in politics is so problematic is that corporations are not as internally democratic as the democratic political systems they inhabit.
Yes, changes in laws are necessary to incentivize corporations to create less severe negative externalities. However, I would argue internal corporate governance should not be a democratic-free zone.
If there is one weakness in the book, and no book can cover everything, it is too little emphasis on building more democratic governance from the inside of corporations with their own bylaws that cover issues such as majority vote requirements, annual elections for all directors, genuine proxy access, etc.
Democracy shouldn’t just be for government. Other institutions form and shape our citizens. Business has become by far the most powerful institution but the family, church, school, neighborhood, environmental groups and even bowling leagues offer mediating structures between the individual and society. The more we make such structures democratic, the more we empower rule by actual common people.
About Ciara Torres-Spelliscy
Ciara Torres-Spelliscy is a Brennan Center Fellow and an Associate Professor of Law at Stetson University College of Law. She is the author of the book, Corporate Citizen? An Argument for the Separation of Corporation and State (Carolina Academic Press 2016) and of Safeguarding Markets from Pernicious Pay to Play: A Model Explaining Why the SEC Regulates Money in Politics.
Prior to joining Stetson’s faculty, she was Counsel in the Democracy Program of the Brennan Center for Justice at NYU School of Law. She was an associate at Arnold & Porter LLP and a staffer for Senator Richard Durbin. Professor Torres-Spelliscy has testified before Congress, and has helped draft legislation and Supreme Court briefs. As well as publishing in the Montana Law Review, University of San Francisco Law Review and the NYU Journal of Legislation and Public Policy, and chapters in books, she has been published in the New York Times, New York Law Journal, Boston Review, Business Week, Forbes, The Atlantic, USA Today, The Hill, Huffington Post, Judicature, Salon, and CNN.com. More.
Follow Ciara Torres-Spelliscy on Twitter @ProfCiara
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https://www.corporatecrimereporter.com/news/200/torres-spelliscy-on-corporate-citizenship-and-the-argument-for-separation-of-corporation-and-state/
is a corporation a citizen?
Should it be a citizen?
Those are two questions at the center of Ciara Torres-Spelliscy’s new book — Corporate Citizen? The Argument for the Separation of Corporation and State (Carolina Academic Press, 2016).
Torres-Spelliscy is an associate professor of law at the Stetson University College of Law.
Are corporations citizens?
“I don’t think so,” Torres-Spelliscy told Russell Mokhiber of Corporate Crime Reporter in an interview last week. “The Supreme Court has expanded the constitutional rights of corporations over time. The Court came to various forks in the road where corporate lawyers asserted that corporations had particular constitutional rights. And at each of those junctures, the Court could have said yes or no. If you go back to the early Supreme Court, they first granted corporations coverage of the contracts clause and they also recognized corporate property rights very early on. Another fork in the road was after the Civil War, there was the question whether the equal protection clause of the 14th amendment would apply to corporations. The Supreme Court decided that yes — corporations are covered as persons by the equal protection clause.”
“The next big fork in the road is the First Amendment. The Roberts court has been very generous in giving corporations political rights — rights most people think should only attach to a human citizen.”
When you say political rights, you mean what?
“The primary political right is the right to spend money on politics. In 1978, in the Bellotti case,corporations won the right to spend on ballot measures or initiative fights. In 2010, they won the right to spend in candidate elections. That was Citizens United, which held that corporations can spend an unlimited amount of money on political acts in American elections — whether dog catcher all the way up to President.”
When I asked — are corporations citizens? You said — I don’t think so. Are you saying, corporations are not citizens? Or they shouldn’t be citizens?
“The language around corporate citizenship is legally fraught in many dimensions. You can think of this from the perspective of corporate law. As a matter of corporate law, a corporation is a citizen from the state they are incorporated. They are domestic in that state of incorporation. They are foreign in every other state. That’s one sense in which you can think of citizenship.”
“I’m conceiving of citizenship as it applies to human beings. That’s why it’s inappropriate for the Supreme Court to give political rights to corporations. Political rights are given to human beings who were born to American citizens or naturalized. It’s strange to give political rights to corporations, in part because they are artificial beings, they can live forever, and they have advantages that are innate in the corporate form that a human being doesn’t have.”
“The Supreme Court is giving First Amendment rights to corporate entities when it is not appropriate.”
“The other one that drives me up the wall is giving corporations religious rights. In Hobby Lobby, two closely held corporations were granted coverage under a federal statute that protects religious liberty. They haven’t quite gotten to the point where they are making a constitutional ruling on the religious freedom of corporations. But that is the natural next step in litigation. They are saying — not only do we want the statutory protection for religious liberty for corporations, we want the full First Amendment protection as well. I would expect cases coming down the pike to make those arguments as well.”
You don’t think corporations should be citizens.
“Correct.”
And increasingly they are being treated as citizens.
“Yes.”
On the law books, they are citizens, but you don’t think they should be?
“There is a line of cases that arise under the comity clause. That clause guarantees that a citizen of one state will be treated the same when they go across state lines. A state is not allowed to treat out of staters any worse than it treats its own citizens. This is also known as the privileges and immunities clause.”
“Corporate lawyers tried to get coverage for corporations under the comity clause. In a set of interesting decisions, which have never been overturned, the Supreme Court came to the conclusion that corporations are not covered by the comity clause. The Supreme Court said that corporations are not citizens for the purpose of the comity clause.”
“If you are looking at corporations as citizens from a corporate law point of view, you think of them as domesticated in the state where they are incorporated.”
“But there are these comity clause cases from the Supreme Court that say explicitly that corporations are not citizens.”
“Whether they are citizens or not depends on who is asking the question and who is answering.”
Do you believe corporations should be stripped of all citizen rights?
“Corporate personhood is a useful legal fiction when it comes to contract and property rights. It’s actually useful that a corporation, say a university, can own land in the corporate name. If they couldn’t own land in the corporate name, it would require all sorts of transfers of deeds and titles to whoever was on the faculty at a particular time. If you lost a faculty member, you would have to redo the deeds.”
“There is a certain efficiency in having corporations own property in the corporate name. That’s how corporate personhood started. It started in medieval Europe with a Pope who was also a lawyer. That part of corporate rights doesn’t bother me at all. What does bother me are the political and religious rights. Those seems inappropriately granted to corporate entities.”
What about due process?
“Of course, I would want as a matter of the rule of law, whether you are a human being or a corporate entity, the government should use due process of law.”
Whether you are a person or a corporation?
“Correct.”
When I asked you whether a corporation should be a citizen, you said no. You are not saying that. You are saying corporations should have some rights of citizenship, but not others.
“Correct.”
The subtitle of your book is — an argument for the separation of corporation and state. What do you mean by that?
“Part of that is to indicate to the casual bypasser, who might see only the outside of the book, that this was not an argument for corporate citizenship. The basic thesis of my book is that corporations are getting more and more constitutional rights at the very same time that they are being excused from certain responsibilities. This is not going unnoticed. There is enormous push back from lawmakers, investors, consumers and fellow entrepreneurs. These entrepreneurs are opting to operate as a benefit corporation.”
“A benefit corporation is a new legal entity. They started in 2010 in Maryland. There are now benefit corporation laws in 31 states. A benefit corporation is one where in the foundational documents, they indicate a public purpose for the corporation in addition to making profits. The advantage of this form is the investors are on notice that the corporation will do something in the public good. It is not purely designed to make a profit. That means that investors can’t sue the board if they use corporate resources in a charitable way that furthers that public purpose. The benefit corporations are a way for corporate law to evolve.”
You say that not only are corporations gaining rights, they are evading responsibilities. For example, they effectively dodge the criminal justice system. But that’s not a function of corporate citizenship. It’s a function of brute corporate power.
“When I teach corporate law, I note that corporations are getting off the hook in these different scenarios — deferred prosecutions, non prosecutions. When I was teaching constitutional law, I saw them sucking up these rights. It’s the combination of these two that I saw as unjust. If we are going to give them these political rights, it would be appropriate to hold them responsible in other areas.”
“The one that drives me up the wall are the human rights cases. The Supreme Court made a couple of rulings recently that essentially are going to have the effect of excusing multinational corporations from answering to human rights abroad in U.S. courts. The rationale so far has been based on the extraterritoriality of U.S. law and whether Congress has been unclear whether they want U.S. law to apply externally.”
“The net effect is that if you are a multinational corporation and you have a subsidiary in Africa, then it’s almost impossible under these rulings to bring that parent company into U.S. court even if they have a significant U.S. parent doing business in the United States. Those human rights rulings make it nearly impossible for a human rights victim, who may be in the United States because they have been granted asylum here, to go after those corporate actors for those bad deeds abroad.”
===
stetson
:{:{:{}:
}:}:
A.B., Harvard University
J.D., Columbia School of Law
:{:{Courses:}:
Election Law, Constitutional Law I and II, Corporate Governance in a Global Market, Business Entities, Honors Colloquium, and First Amendment}:
Ciara Torres-Spelliscy is a professor teaching courses in Election Law, Corporate Governance, Business Entities, and Constitutional Law. Prior to joining Stetson's faculty, Professor Torres-Spelliscy was counsel in the Democracy Program of the Brennan Center for Justice at NYU School of Law where she provided guidance on the issues of money in politics and the judiciary to state and federal lawmakers. She was an associate at Arnold & Porter LLP and a staffer for Senator Richard Durbin.
Professor Torres-Spelliscy has testified before Congress, and state and local legislative bodies as an expert on campaign finance reform. She has also helped draft legislation and Supreme Court briefs. She is the editor of the 2010 edition of the Brennan Center's campaign finance treatise, "Writing Reform: A Guide to Drafting State and Local Campaign Finance Laws."
She researches and speaks publicly on campaign finance law as well as judicial selection. She has spoken at symposia and other events at 44 universities around the nation, including Harvard, Yale, and Stanford. She presented at the 2013, the 2015, the 2018, the 2019, and the 2020 Annual Conventions of the Association of American Law Schools (AALS) and at the 2014, 2018, and 2019 Annual Convention of the American Constitution Society (ACS), and the 2011, the 2014, and the 2016 Annual Conventions of the Council on Governmental Ethics Laws (COGEL). In 2016 she spoke at the Federal Election Commission (FEC) at a forum on dark money and foreign money in U.S. elections. In 2018, she spoke at the International Society of Public Law's ICON-S conference in Hong Kong.
She is the author of the book Corporate Citizen? An Argument for the Separation of Corporation and State (Carolina Academic Press, 2016), and the book Political Brands (Edward Elgar Publishing, 2019).
As well as publishing in law reviews, such as the Harvard Law & Policy Review, NYU Law Review Online, the University of Pennsylvania Law Review Online, Harvard Journal of Law & Public Policy, the Duke Journal of Constitutional Law & Public Policy, and the Montana Law Review, Professor Torres-Spelliscy has been published in The Washington Post, New York Times, New York Law Journal, Slate, L.A. Times, U.S. News and World Report, Boston Review, Roll Call, Business Week, Forbes, The Atlantic, USA Today, Business Ethics Magazine, San Francisco Chronicle, The Hill, Huffington Post, The Root.com, Judicature, The Nation, Salon.com, Talking Points Memo, Tampa Bay Times, The Progressive, CNN.com, Medium, Shondaland, and the ABA Judges Journal. She has also been quoted by the media in The Wall Street Journal, The Economist, The New York Times, Time, Bloomberg, Mother Jones, Newsweek on Air, SCOTUS Blog, Politico, Slate, The National Journal, USA Today, L.A. Times, Boston Globe, NBC.com, Vox, VICE, Five Thirty Eight, WMNF, Sirius Radio, National Public Radio, Fox, Voice America, CSPAN, DNA TV, and NY1.
In 2014, Stetson University College of Law awarded Professor Torres-Spelliscy the Dickerson-Brown award for Excellence in Faculty Scholarship. In 2013, Professor Torres-Spelliscy was named as a member of the Lawyers of Color's "50 Under 50" list of minority law professors making an impact in legal education. She was awarded tenure in 2016. In 2017, she was elected to be Chair of the AALS Section on Election Law for a term that started in 2018. She was awarded the Homer & Dolly Hand Award for Excellence in Faculty Research by Stetson University in 2019. In 2020, Professor Torres-Spelliscy was elected to be a member of the AALS Section on Constitutional Law Executive Committee.
Professor Torres-Spelliscy is a Brennan Center Fellow, a member of the Scholars Strategy Network, a member of the Board of Directors of the Mertz Gilmore Foundation, a former member of the Board of Directors of the National Institute on Money in State Politics, which was awarded the 2015 MacArthur Award for Creative and Effective Institutions.
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guernica https://www.guernicamag.com/author/ciara-torres-spelliscy/**
The Strange Legal Marriage of the Anti-choice Movement and Campaign Finance
By Ciara Torres-Spelliscy July 20, 2016
The same jerks after your uterus are shooting down campaign rules; one tactic just backfired.
COMMENTARY JUSTICERACEUSA
The South Doesn’t Have a Monopoly on our Racist History
By Ciara Torres-Spelliscy July 9, 2015
We should take down the Confederate flag, but racism has always been and continues to be a national issue. A case study of Crandall v. State before the Connecticut Supreme Court in 1834 serves as a prime example.
COMMENTARY GOVERNMENT
Somebody Give Bill Gates and Drew Faust a Copy of Citizens Disunited
By Ciara Torres-Spelliscy May 21, 2013
The new book by “class traitor” Robert Monks shows a system at its breaking point—and names the twenty-four Americans who can fix it.
Robert A.G. Monks, a long-time expert on corporate governance, is not known for mincing his words, and his latest book Citizens Disunited pulls no punches. He wants big investors to start using their influence to push back. Writing about corporate political power, Monks warns that “money buys voices, ears, face time, and sit-downs, but it also buys silence.” It is the silence in service of the status quo that he interrogates throughout his short, hard-hitting tome.
While soft celebrity news has found its way onto the CNN news ticker, an underappreciated struggle for the soul of American companies has been under way. In Citizens Disunited, Monks pulls back the curtain to reveal the broad outlines of a battle that has been raging for decades, largely outside of the public’s gaze, between activist investors and the companies that they own.
As Monks, who literally wrote the book on Corporate Governance, sees it, the little guys have largely lost in their attempts to reign in executive compensation, sky high options and managerial perks like the personal use of corporate jets, money for pet projects and campaign funds—all of which are provided at shareholder expense.
As Monks explains, there are many reasons why “corporate democracy” as it is currently practiced is a failure. First, unlike the election for President where voters get to choose between at least two candidates, in board “elections” there is usually only one candidate on the ballot. Second, even board members who fail to get a majority vote can still continue to serve. And finally, shareholder proposals that make it onto the proxy are purely precatory. In other words, the board can ignore the result of the vote. All of these practices tilt the balance of power firmly towards corporate management, and away from shareholders.
A Republican from Maine, Monks paints a grim picture of the S&P 500 and many of their CEOs, who often lack the care expected of a true fiduciary. But he also methodically indicts those who enable CEOs, such as rubberstamping boards, institutional investors who habitually sit out proxy fights, and a judicial system which mistakenly trusts corporations to self-regulate.
Monks’ jumping off point for examining judicial failure to check corporate power is the Supreme Court’s 2010 folly, Citizens United. In blunt, straightforward, language he lays out some of the problems that have followed from this decision, which allowed corporations to make expenditures in American elections, including the big spending of Super PACs in 2012 and secretive spending by 501(c)(4)s and 501(c)(6)s likely hiding corporate funds.
Monks doesn’t stop his analysis with Citizens United, but rather, he drills down to where the legal flaws started with 1978’s lesser known Bellotti decision (which allowed corporations to spend in ballot measure fights) and its dubious citation to Santa Clara County v. Southern Pacific R. Co. from 1886 (the case that established, in a headnote inserted by the court reporter, that corporations are persons for 14th Amendment purposes).
Monks, who turns eighty this year, is clearly alarmed at the corporate capture of the regulatory system during his lifetime—a system that is supposed to protect consumers from dangerous products, workers from unsafe employment conditions and the environment from toxic waste. The stridency of his tone may turn some readers off. For example, calling certain corporations “drones” may be more distracting than helpful.
For my taste as a campaign finance lawyer, the book could have done with a bit more nuance when it came to distinguishing between money that comes from the corporate treasury and money that comes from the personal accounts of corporate managers. But as a general matter, he covers the complexity of campaign finance—an area that deeply affects Americans but which few Americans deeply understand—in a way that is both accessible and accurate.
More problematic is his failure to point out the wins that socially conscious investors have racked up—like the sustainability reporting that is now part of U.K. law or the environmental reporting reforms embedded in Dodd-Frank. He also largely skips the successes shareholders have had at top companies in convincing them to be more transparent about their political spending voluntarily and the trend toward majority voting and declassified boards. Leaving out these victories gives the book a gloomy gloss.
Despite being dubbed a “traitor to his class” by one biographer, Monks is trying to get the attention of a particular elite. He unabashedly names the twenty-four people (including Bill Gates) who have the ability to change how corporations behave by wielding their own economic power. Those called out are the heads of foundations, trusts and the university endowments of Harvard, Yale, Princeton, Stanford, MIT and the University of Texas, who collectively control approximately $200 billion.
This book is an exhortation to these twenty-four and those similarly situated, such as the men and women who run the nation’s biggest mutual funds and public pensions, to use their power as shareholders to engage with corporations so that companies do better by the environment, their workers, their communities, and the political process.
Monks also offers some positive policy solutions, which all of us, not just these elite twenty-four, can influence. These policy fixes include legislation that is still alive in Congress like the DISCLOSE Act, (H.R. 148), which would bring greater transparency to political spending across the board; the Shareholder Protection Act, (H.R. 1734), which would give shareholders a vote on the size of future corporate political budgets; as well as a constitutional amendment to undo Citizens United.
The book is a description of a broken system at a tipping point. Monks knows after decades of working on the issue of corporate governance that the path to corporate responsibility is a difficult one, but he is exhorting us to use our power as investors and as citizens to slam on the breaks before we really go off a cliff. What lies in the balance, according to Monks, is “responsible liberty and capitalist-based democracy.”
COMMENTARY HEALTHPOLITICSUSA
The John Roberts Head Fake
By Ciara Torres-Spelliscy July 4, 2012
The Supreme Court’s decision to uphold Obamacare obscures the ruling’s other, deeply conservative result: a road-map for gutting Congressional power.
COMMENTARY POLITICSUSA
America Doesn’t Need Another CREEP
By Ciara Torres-Spelliscy May 9, 2012
Watergate led to a grassroots effort to clean up Washington. In the wake of Citizens United, and with the upcoming 40th anniversary of the Watergate scandal, is it time to act again?
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pubs
Professor Torres-Spelliscy's scholarship is available for download for free on the Social Science Research Network, http://papers.ssrn.com/sol3/cf_dev/AbsByAuth.cfm?per_id=584767
eg
:{Slaves to the Bottom Line: The Corporate Role in Slavery from Nuremberg to Now:(style="box-sizing:border-box;text-decoration-line:none"):}:
Stetson Law Review, Vol. 46, 2016
Number of pages: 32 Posted: 08 Feb 2017
Ciara Torres-Spelliscy
Stetson University College of Law
:{Dark Money As a Political Sovereignty Problem:(style="box-sizing:border-box;text-decoration-line:none"):}:
28(2) Kings Law Journal 239 (2017).
Number of pages: 17 Posted: 05 Nov 2016 Last Revised: 27 Apr 2018
Ciara Torres-Spelliscy
Stetson University College of Law
:{:{}:
}:
-
Follow her on Twitter for academic updates @ProfCiara
Books
Political Brands (Elgar Publishing 2019).
Corporate Citizen? An Argument for the Separation of Corporation and State
(Carolina Academic Press 2016).
:{:{Law Review Articles}:
}:
Ciara Torres-Spelliscy, Elegy for Anti-Corruption Law: How the Bridgegate Case Could Crush Corruption Prosecutions and Boost Liars, 69 American University Law Review 1689 (2020).
Ciara Torres-Spelliscy, Deregulating Corruption, 13 Harvard Law & Policy Rev. 471 (2019).
Ciara Torres-Spelliscy, From a Mint on a Hotel Pillow to an Emolument, 70 Mercer L. Rev. 705 (Spring 2019).
Ciara Torres-Spelliscy, Time Suck: How the Fundraising Treadmill Diminishes Effective Governance, 42 (2) Seton Hall Legislative Journal 271 (2018).
Ciara Torres-Spelliscy, Campaign Finance, Free Speech, and Boycotts, 41 Harvard J. of L. & Public Policy 153 (2018).
Ciara Torres-Spelliscy, Dark Money as a Political Sovereignty Problem, 28 (2) Kings L.J. 239 (2017).
Ciara Torres-Spelliscy, Shooting Your Brand in the Foot: What Citizens United Invites, 68 Rutgers U. L. Rev. 1295 (Spring 2016).
Ciara Torres-Spelliscy, Slaves to the Bottom Line: The Corporate Role in Slavery from Nuremberg to Now, 46(1) Stetson L.R. 167 (Fall 2016).
Ciara Torres-Spelliscy, A locked iPhone; Unlocked Corporate Constitutional Rights, 164 Penn L. Rev. Online 287 (2016).
Ciara Torres-Spelliscy, Corporate Democracy from Say on Pay to Say on Politics, 30(2) Constitutional Commentary 431 (Summer 2015).
Ciara Torres-Spelliscy, Electoral Silver Linings afterShelby, Citizens United and Bennett, 17 Berkeley J. Afr.-Am. L. & Pol'y 103 (2015).
Kathy Fogel, Rwan El-Khatib, Nancy Chun Feng & Ciara Torres-Spelliscy, Compliance Costs and Disclosure Requirement Mandates: Some Evidence, 27(1) Research In Accounting Regulation 83–87 (April 2015).
Ciara Torres-Spelliscy, Kathy Fogel & Rwan El-Khatib, Running the D.C. Circuit Gauntlet on Cost-Benefit Analysis after Citizens United: Empirical Evidence from Sarbanes-Oxley and the JOBS Act, 9 Duke J. Const. L. & Pub. Pol'y 135 (2014).
Ciara Torres-Spelliscy, The Democracy We Left Behind in Greece and McCutcheon, 89 NYU L. Rev. Online 112 (2014).
Ciara Torres-Spelliscy, Safeguarding Markets from Pernicious Pay to Play: A Model Explaining Why the SEC Regulates Money in Politics, 12(2) Connecticut Public Interest L. J. 361 (2012-2013).
Ciara Torres-Spelliscy, Taking Opt-In Rights Seriously: What Knox v. SEIU Could Mean for Post-Citizens United Shareholder Rights, 74(1) Montana L. Rev. 101 (2013).
Ciara Torres-Spelliscy, How Much Is an Ambassadorship? And the Tale of How Watergate Led to a Strong Foreign Corrupt Practices Act and a Weak Federal Election Campaign Act, 16(1) Chapman L. Rev. 71 (Spring 2012).
Ciara Torres-Spelliscy, The $500 Million Question: Are the Democratic and Republican Governors Associations Really State PACs Under Buckley's Major Purpose Test?, 15 NYU J. of Legislation & Public Policy 485 (Spring 2012)....
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talks
snip
Spoke on a panel called “Blueprint for Democracy: How We Can Stop Being Ripped Off”about the dangers of dark money hosted by Common Cause Ohio on Nov. 16, 2020.
Spoke remotely to the Pinellas Democrats about the 2020 elections in Florida, her book Political Brands, and post-election litigation by President Trump’s lawyers on Nov. 12, 2020.
Spoke on a webinar panel with the Dean of Stetson Law School Michèle Alexandre entitled “Community Conversation on the Legal Aspects of the 2020 Election” on Nov. 5, 2020.
Spoke on a webinar panel with the President of Stetson University Christopher F. Roellke entitled “President's Weekly Update: 2020 Election, What Happened?” on Nov. 5, 2020.
Spoke on a panel with University of Chicago Professor Geoffrey R. Stone about the First Amendment, the 2020 election and her book Political Brands in New America’s online symposium “Free Speech Project: Do We Need a First Amendment 2.0?” on Oct. 28, 2020.
Featured in the documentary film, “Fish in a Barrel,” about the 2016 election released in October 2020.
Spoke remotely to Stetson Law Chapter of theAmerican Constitution Society(ACS) about voting safely in 2020 on Oct. 21, 2020.
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