No. 08-205

IN THE

Supreme Court of the United States

_______________________________

ON APPEAL FROM THE UNITED STATES

DISTRICT COURT FOR THE DISTRICT OF COLUMBIA

CITIZENS UNITED,

Appellant,

v.

FEDERAL ELECTION COMMISSION,

Appellee.

SUPPLEMENTAL BRIEF OF AMICUS CURIAE

CHAMBER OF COMMERCE OF THE UNITED

STATES OF AMERICA IN SUPPORT OF APPELLANT

ROBIN S. CONRAD

AMAR D. SARWAL

NATIONAL CHAMBER

LITIGATION CENTER, INC.

1615 H Street, N.W.

Washington, D.C. 20062

(202) 463-5337

JAN WITOLD BARAN

Counsel of Record

THOMAS W. KIRBY

CALEB P. BURNS

WILEY REIN LLP

1776 K Street, N.W.

Washington, D.C. 20006

(202) 719-7000

STEVEN J. LAW

Chief Legal Officer and

General Counsel

JUDITH K. RICHMOND

Vice President and

Associate General Counsel

U.S. CHAMBER OF COMMERCE

1615 H Street, N.W.

Washington, D.C. 20062

(202) 463-5576

Counsel for Amicus Curiae
i

QUESTION PRESENTED

For the proper disposition of this case, should the

Court overrule either or both Austin v. Michigan

Chamber of Commerce, 494 U.S. 652 (1990), and the part

of McConnell v. FEC, 540 U.S. 93 (2003), which

addresses the facial validity of Section 203 of the

Bipartisan Campaign Reform Act of 2002, 2 U.S.C.

§ 441b?
ii

Cited Authorities

Page

TABLE OF CONTENTS

QUESTION PRESENTED . . . . . . . . . . . . . . . . . . i

TABLE OF CONTENTS . . . . . . . . . . . . . . . . . . . . ii

TABLE OF CITED AUTHORITIES . . . . . . . . . iv

INTEREST OF THE AMICUS CURIAE . . . . . 1

SUMMARY OF ARGUMENT . . . . . . . . . . . . . . . 1

ARGUMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

I. THE GOVERNMENT MUST PROVE

THAT ANY RESTRICTION ON CORPORATE ELECTORAL ADVOCACY IS

NARROWLY TAILORED TO MEET A

TRULY COMPELLING NEED. . . . . . . . 5

II. AUSTIN’S ASSUMPTION THAT

IMMENSE CORPORATE WEALTH

DISTORTS ELECTIONS WAS FACTUALLY UNSUPPORTED AND IS UNSUPPORTABLE. . . . . . . . . . . . . . . . . . . . . . . . . . 6

A. Bellotti Held That Austin’s Theory

Of Corruption Could Not Even Be

Considered Without A Supporting

Demonstration. . . . . . . . . . . . . . . . . . . . 7
iii

Cited Authorities

Page

Contents

B. Readily Available Evidence Does Not

Support The Compelling Interest

Assumed To Exist In Austin. . . . . . . 8

C. Austin’s Professed Concern With

Preventing “Distortion” Really Is A

Constitutionally Forbidden Effort To

“Level The Playing Field.” . . . . . . . . 12

D. Austin’s Professed Interest In

Limiting Corporate Speech To Ideas

The Public Supports Is Contrary To

The First Amendment. . . . . . . . . . . . . 13

III. AUSTIN’S CATEGORICAL BAN ON

CORPORATE ADVOCACY IS NOT

NARROWLY TAILORED TO PREVENT GREAT WEALTH FROM DISTORTING ELECTIONS. . . . . . . . . . . . . . . 14

IV. THIS IS A PROPER CASE IN WHICH

TO OVERRULE AUSTIN. . . . . . . . . . . . . 19

CONCLUSION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
iv

Cited Authorities

Page

TABLE OF CITED AUTHORITIES

FEDERAL CASES

Agostini v. Felton,

521 U.S. 203 (1997) . . . . . . . . . . . . . . . . . . . . . . . 20

Associated Press v. United States,

326 U.S. 1 (1945) . . . . . . . . . . . . . . . . . . . . . . . . . . 5, 14

Austin v. Michigan Chamber of Commerce,

494 U.S. 652 (1990) . . . . . . . . . . . . . . . . . . . . . passim

Buckley v. Valeo,

424 U.S. 1 (1976) . . . . . . . . . . . . . . . . . . . . . . . . . . 5, 12

Burnet v. Coronado Oil & Gas Co.,

285 U.S. 393 (1932) . . . . . . . . . . . . . . . . . . . . . . . 20

Caperton v. A.T. Massey Coal Co., Inc.,

129 S. Ct. 2252 (2009) . . . . . . . . . . . . . . . . . . . . . 15

Davis v. FEC,

128 S. Ct. 2759 (2008) . . . . . . . . . . . . . . . . . . . . . 7, 12

FEC v. Massachusetts Citizens for Life, Inc.,

479 U.S. 238 (1986) . . . . . . . . . . . . . . . . . . . . . . . 3

FEC v. National Conservative

Political Action Committee,

470 U.S. 480 (1985) . . . . . . . . . . . . . . . . . . . . . . . 7
v

Cited Authorities

Page

FEC v. Wisconsin Right to Life, Inc.,

551 U.S. 449 (2007) . . . . . . . . . . . . . . . . . . . . . . . 6, 19

First National Bank of Boston v. Bellotti,

435 U.S. 765 (1978) . . . . . . . . . . . . . . . . . . . . . passim

Hancock v. Louisville & N. R. Co.,

145 U.S. 409 (1892) . . . . . . . . . . . . . . . . . . . . . . . 2

Landmark Commc’ns, Inc. v. Virginia,

435 U.S. 829 (1978) . . . . . . . . . . . . . . . . . . . . . . . 6

McConnell v. FEC,

540 U.S. 93 (2003) . . . . . . . . . . . . . . . . . . . . . . . . . i, 3

Mills v. Alabama,

384 U.S. 214 (1966) . . . . . . . . . . . . . . . . . . . . . . . 5

Monitor Patriot Co. v. Roy,

401 U.S. 265 (1971) . . . . . . . . . . . . . . . . . . . . . . . 5

Sable Commc’ns of Cal., Inc. v. FCC,

492 U.S. 115 (1989) . . . . . . . . . . . . . . . . . . . . . . . 6

Seminole Tribe of Fla. v. Florida,

517 U.S. 44 (1996) . . . . . . . . . . . . . . . . . . . . . . . . . 20

Smith v. Allwright,

321 U.S. 649 (1944) . . . . . . . . . . . . . . . . . . . . . . . 20

Turner Broad. System, Inc. v. FCC,

512 U.S. 622 (1994) . . . . . . . . . . . . . . . . . . . . . . . 6
vi

Cited Authorities

Page

FEDERAL STATUTES

Section 203 of the Bipartisan Campaign Reform

Act of 2002, 2 U.S.C. § 441b . . . . . . . . . . . . . . . . i

FEDERAL REGULATIONS

11 C.F.R. § 110.1(g) . . . . . . . . . . . . . . . . . . . . . . . . . . 2

MISCELLANEOUS

10 Candidates Who Spent Giant Sums of Their

Personal Wealth, Real Clear Politics, July 9,

2009, http://www.realclearpolitics. com/lists/

candidate_spenders . . . . . . . . . . . . . . . . . . . . . . . 17

48 Cong. Rec. 75 (1912) . . . . . . . . . . . . . . . . . . . . . . 1

California Fair Political Practices Commission,

The Billion Dollar Money Train (2009),

available at http://www.fppc.ca.gov/reports/

billion_dollar_money_train.pdf . . . . . . . . . . . . . 11

California Fair Political Practices Comm’n,

Independent Expenditures: The Giant

Gorilla in Campaign Finance (2008),

available at http://www.fppc.ca.gov/ie/IE

Report2.pdf . . . . . . . . . . . . . . . . . . . . . . . . . . . 9, 10, 11
vii

Cited Authorities

Page

Samuel Gedge, Comment, “Wholly Foreign to

the First Amendment”: The Demise of

Campaign Finance’s Equalizing Rationale

in Davis v. Federal Election Commission,

32 Harv. J. L. & Pub. Pol’y 1197 (2009) . . . . . . 13

Matt Kelley and Fredreka Schouten, Wealthy

Few Provide Cash for Independent Political

Groups, USA Today, July 22, 2008, available

at http://www.usatoday.com/news/politics/

election2008/2008-07-21-donorinside_N.htm . . 16

Tom Precious, Golisano Bids to Finance

Reforms, Buffalo News, July 9, 2008 . . . . . . . . 17

R.G. Ratcliffe, Millionaires Gave a Third of All

Money Raised for ’06 State Races, Houston

Chronicle, Sept. 27, 2007 . . . . . . . . . . . . . . . . . . 17

Norman Solomon, Calculating How Much

Candidates Spend for Every Vote, Cleveland

Plain Dealer, June 5, 1998. . . . . . . . . . . . . . . . . . 17

U.S. Small Business Administration, FAQs:

Frequently Asked Questions, Sept. 2008,

http://www.sba.gov/advo/stats/sbfaq.pdf . . . . . 14
1

INTEREST OF THE AMICUS 1

The Chamber of Commerce of the United States of

America (“Chamber”) is the world’s largest not-forprofit business federation, representing an underlying

membership of over 3,000,000 businesses and business

associations. For almost a century, the Chamber has

played a key role in advocating on behalf of its

membership, which is composed mostly of business

corporations. The Chamber’s interests in this case are

set out in more detail in its initial brief in this action.

See Brief of Amicus Curiae Chamber of Commerce of

the United States of America in Support of Appellant

(“Chamber Br.”) at 1-3.

SUMMARY OF ARGUMENT

On December 7, 1911, President (later Chief Justice)

William Howard Taft called for a national organization

to increase involvement of American business in national

governance, particularly government policies affecting

foreign commerce. 48 Cong. Rec. 75 (1912). A year later,

the Chamber was founded.

Unfortunately, government has not always shared

President Taft’s openness to business participation. At

all levels of government, elected officials who oppose

1. All parties have consented to the filing of this amicus curiae

brief as indicated by letters of consent filed with the Court. No

counsel for a party authored this brief in whole or in part, and no

counsel or party made a monetary contribution intended to fund

the preparation or submission of this brief. No person other than

amicus curiae, its members, or its counsel made a monetary

contribution to its preparation or submission.
2

business viewpoints have sought to keep them from

being expressed, particularly when their reelections are

at stake. Rather than explicitly taking an anti-business

stance, these restrictions often target speech by

“corporations” to suppress the business viewpoint.2

Corporate speech is suppressed even though it is

independent of any candidate, campaign, or political

party and presents no threat or appearance of quid pro

quo corruption. (The viewpoints of other groups, such

as labor unions, often have been similarly suppressed.)

That categorical suppression of corporate electoral

advocacy rests on Austin v. Michigan State Chamber

of Commerce, 494 U.S. 652 (1990). There, for the first

time, a divided Court sustained a wholesale statutory

ban on corporate candidate advocacy. See Brief for the

Appellee at 33 n.11 (no prior cases so held).

Austin rests in fundamental conflict with First

National Bank of Boston v. Bellotti, 435 U.S. 765 (1978),

which rejected a categorical ban on corporate advocacy

concerning ballot initiatives. Strikingly, Austin did not

rely on the involvement of candidates to distinguish

Bellotti. Instead, it held that, because all corporations

have the structural potential to achieve immense wealth,

2. Speaking broadly, a “corporation” is an association that

is treated in law as a “person” with existence, interests, and

powers distinct from its owners, founders, or members. See

Black’s Law Dictionary (9th ed. 2009); Hancock v. Louisville &

N. R. Co., 145 U.S. 409, 415-16 (1892). Many limited liability

companies (“LLCs”) are treated as corporations by the FEC.

See 11 C.F.R. § 110.1(g). An LLC has those basic corporate

attributes and, for purposes of this brief, is considered a

corporation.
3

which could distort elections, there was a compelling

need to ban all public corporate communications

expressly advocating for or against a candidate.

494 U.S. at 659-60. It based this ruling on mere assertion,

even though Bellotti had held that, in the absence of a

factual demonstration, a theory of distortion caused by

corporate wealth could not even be considered.

435 U.S. at 789.

As years passed and Austin proved impossible to

reconcile with basic First Amendment principles, one

member of the Austin majority disavowed his vote,

McConnell, 540 U.S. 350 (2003) (Rehnquist, C.J.,

dissenting) (adopting Justice Kennedy’s opinion in full),

and other Justices expressed willingness to reconsider

the case. Nevertheless, Austin became the foundation

for sweeping restrictions on the speech of business

corporations. In particular, the electoral advocacy of the

Chamber – a not-for-profit corporation – and of millions

of its corporate members has been suppressed. This has

occurred even though 96% of Chamber members are

businesses with fewer than 100 employees, far from the

immense aggregations of wealth hypothesized in Austin.

Suppression has been imposed even when candidates

have directly attacked business interests and when

corporations have unique and valuable insight into the

likely consequences of electing or defeating particular

candidates. Although this Court has protected the

ability of corporations to discuss “issues,” that is no

substitute for direct and explicit speech about

candidates. Nor is the clumsy and expensive “PAC”

option equivalent to the right to publicly, swiftly, and

freely address candidates and campaigns. See Austin,

494 U.S. at 652; FEC v. Massachusetts Citizens for Life,

Inc., 479 U.S. 238, 252-54 (1986) (“MCFL”).
4

The Court now has asked if Austin should be

overruled. Strongly interested in restoring free

corporate speech, the Chamber submits this amicus

brief urging this Court to overrule Austin and hold that

the corporate form of a speaker is not a constitutional

basis for banning core speech. Austin should be

overruled because:

• Austin erroneously allowed the Government to

assume, rather than prove, that independent

corporate candidate advocacy will distort

elections when, in fact, the experience of the

majority of states – which allow free independent

advocacy by corporations – is to the contrary,

and the Government now has abandoned

Austin’s distortion rationale.

• Austin’s professed interest in eliminating

“distortions” due to “wealth” boils down to an

attempt to “equalize” speech through

suppression that is forbidden by the First

Amendment.

• Austin’s categorical ban on corporate speech is

not narrowly tailored to prevent the effects of

immense wealth because (a) the great majority

of corporations are not and never become

wealthy, and (b) wealthy individuals spend freely

on candidate advocacy, even if their wealth

derives from corporations.

This is a proper case in which to overrule Austin

because the Government relied exclusively on Austin

to carry its burden of justifying suppression of Citizens
5

United’s speech. Overruling Austin will both provide

full relief to Citizens United and correct ongoing First

Amendment public injury flowing from Austin’s

erroneous holding.

ARGUMENT

I. THE GOVERNMENT MUST PROVE THAT ANY

RESTRICTION ON CORPORATE ELECTORAL

ADVOCACY IS NARROWLY TAILORED TO

MEET A TRULY COMPELLING NEED.

A “major purpose of [the First Amendment] was to

protect the free discussion of government affairs.” Mills

v. Alabama, 384 U.S. 214, 218 (1966). “Advocacy of the

election or defeat of candidates for federal office is no

less entitled to protection under the First Amendment

than the discussion of political policy generally . . . .”

Buckley v. Valeo, 424 U.S. 1, 48 (1976). Indeed, the First

Amendment “has its fullest and most urgent application

precisely to the conduct of campaigns for political

office.” Monitor Patriot Co. v. Roy, 401 U.S. 265, 272

(1971). First Amendment protection for such speech

serves the interests of the entire country, not just wouldbe speakers. “[S]elf-government suffers when those in

power suppress competing views on public issues ‘from

diverse and antagonistic sources.’” Bellotti, 435 U.S. at

777 n.12 (quoting Associated Press v. United States, 326

U.S. 1, 20 (1945)).

“The inherent worth of [such] speech . . . does not

depend upon the identity of its source, whether

corporation, association, union, or individual.” Id. at 777.

Thus, before the government can suppress corporate
6

speech (or spending for speech) concerning public issues

or candidates, it must prove a “compelling” need will be

met by means that are “closely drawn.” Id. at 786

(collecting authority); FEC v. Wisconsin Right to

Life, Inc., 551 U.S. 449 (2007) (controlling opinion)

(“WRTL II”).3

Austin paid lip-service to these settled principles.

494 U.S. at 654, 657. Thus, it held the test was whether

a statute banning independent express advocacy by

corporations was “narrowly tailored to serve a

compelling state interest.” Id. at 657. But having

recognized the test, Austin failed to properly apply it.

II. AUSTIN’S ASSUMPTION THAT IMMENSE

CORPORATE WEALTH DISTORTS ELECTIONS

WAS FACTUALLY UNSUPPORTED AND IS

UNSUPPORTABLE.

The statute at issue in Austin banned independent

corporate advocacy, as opposed to speech coordinated

with a candidate or campaign. The Austin majority did

not attempt to justify the ban as necessary to avoid the

quid pro quo “corruption or appearance of corruption”

that were “the only legitimate and compelling

government interests” that had been accepted as a

3. Proof is necessary. See Turner Broad. Sys., Inc. v. FCC,

512 U.S. 622, 664 (1994); Sable Commc’ns of Cal., Inc. v. FCC, 492

U.S. 115, 129-30 (1989). If legislative findings are proffered,

the record must prove that the legislature “has drawn

reasonable inferences based on substantial evidence.” Turner,

512 U.S. at 666; see also Sable, 492 U.S. at 129; Landmark

Commc’ns, Inc. v. Virginia, 435 U.S. 829, 843 (1978) (no deference

to “legislative finding” unsupported by “actual facts”).
7

sufficient basis to limit core First Amendment speech.

494 U.S. at 658-59 (quoting FEC v. Nat’l Conservative

Political Action Comm., 470 U.S. 480, 496-97 (1985));

see also Davis v. FEC, 128 S. Ct. 2759, 2773 (2008).

Instead, Austin relied on “a different type of

corruption.” Id. at 660. This “corruption” was said to

result from “the corrosive and distorting effects of

immense aggregations of wealth that are accumulated

with the help of the corporate form and that have little

or no correlation to the public’s support for the

corporation’s political ideas.” Id. Austin was mistaken.

A. Bellotti Held That Austin’s Theory Of

Corruption Could Not Even Be Considered

Without A Supporting Demonstration.

Austin’s theory that corporate wealth would distort

and impair the integrity of elections previously had been

asserted in Bellotti in an effort to justify forbidding

corporations to support or oppose ballot initiatives. In

Bellotti, the State had claimed corporate “participation

would exert an undue influence on the outcome of a

referendum vote, and – in the end – destroy the

confidence of the people in the democratic process and

the integrity of government.” 435 U.S. at 789. The State

asserted “corporations are wealthy and powerful and

their views may drown out other points of view.” Id. But

Bellotti responded by demanding proof:

[T]here has been no showing that the relative

voice of corporations has been overwhelming

or even significant in influencing referenda in

Massachusetts, or that there has been any
8

threat to the confidence of the citizenry in

government.

Id. at 789-90 (footnote omitted). Since there was no

proof, Bellotti held that the asserted compelling interest

did not even “merit our consideration.” Id. at 789.

Austin cited Bellotti for the proposition that “a

legislature might demonstrate” that corporate wealth

is corruptive. But Austin then failed to require such a

demonstration; instead it was content that “the State

has articulated a sufficiently compelling rationale.”

Id. at 660. By disregarding Bellotti’s demand for a

demonstrated need – a holding supported by abundant

other authority 4

 – Austin committed fundamental error.

B. Readily Available Evidence Does Not Support

The Compelling Interest Assumed To Exist In

Austin.

There was and is no reason for the government to

rely on assertion instead of proof. At least 26 states and

the District of Columbia permit corporations (as well as

labor unions, and similar groups) to engage freely in

independent electoral advocacy on the same basis as

individuals.5

 If Austin were correct in speculating that

4. See supra p. 5-6 and note 3.

5. The following twenty-seven jurisdictions permit both

direct corporate contributions to candidates and unlimited

corporate independent expenditures: Arkansas, California,

Delaware, District of Columbia, Florida, Georgia, Hawaii,

Idaho, Illinois, Indiana, Kansas, Louisiana, Maine, Maryland,

(Cont’d)
9

corporate speech would result in distortions due to the

deployment of immense corporate wealth, such effects

should appear in these states. The Government offered

no such demonstration, nor has the Chamber identified

any. Instead, the two reports identified by the Chamber

and discussed below show no basis for suppressing

corporate speech.

California allows corporations (and labor and other

groups) to engage freely in independent campaign

advocacy. In June 2008, the California Fair Political

Practices Commission (“FPPC”) issued a report entitled

Independent Expenditures: The Giant Gorilla in

Campaign Finance.

6

 The report was hostile to all

independent expenditures, portraying them as a

“loophole” that “circumvent[s] state limits on direct

campaign contributions.” Id. at 6. It speculated that

candidates may tend to favor those whose independent

speech supports them, but it did not suggest that this

concern applies more to corporations than to other

speakers. To the contrary, it reported that the highestMississippi, Missouri, Nebraska, Nevada, New Hampshire, New

Jersey (for corporations in non-regulated industries), New

Mexico, Oregon, South Carolina, Utah, Vermont, Virginia, and

Washington. Research identified no statutory or regulatory

prohibition on corporate independent advocacy in these states,

and that research was confirmed by telephoning the state

regulatory bodies. The Supplemental Brief for the Appellee

(at 18 n.3) reports a consistent count. This demonstrates that

overruling Austin would not affect a majority of the states.

6. Available at http://www.fppc.ca.gov/ie/IEReport2.pdf.

(Cont’d)
10

spending independent group received 80% of its funding

from two wealthy individuals. Id. at 11. And it found that

none of the primary supporters of the three highest

spending independent advocacy groups were corporations.

Id. at 11-12. Instead, they were individuals, Indian tribes,

and labor unions. Id. None of its five recommendations

involved banning independent candidate advocacy by

corporations. Id. at 82-83.

All 80 California Assembly districts and 20 Senate

districts held elections in 2008, http://www.joincalifornia.

com/election/2006-11-07. The report discussed the ten state

legislative primary races in 2008 in which the highest levels

of independent spending occurred. Id. at 61-67. Those ten

races accounted for 78% ($9.4 million) of the statewide total

of $12 million in independent expenditures on the primary

races. Thus, in the great majority of these legislative races

(90 of 100), there was little independent spending by

corporations or anyone else. Strikingly, in six of the ten

analyzed races, the candidate who received the highest

level of independent advocacy support lost. Id. at 62-67.

California held over one thousand legislative and

executive elections between January 1, 2001, and

December 31, 2006.7

 The report analyzed twelve races

where total independent spending from all sources

exceeded candidate/campaign spending. Id. at 23-36. In

seven of those twelve, the candidate who benefited from

the highest level of independent spending lost the election.

Id. at 26, 27, 30-32, 35, 36. In four of those seven races, the

winner had less than approximately 1/3 the independent

7. This information is available from the Secretary of

State’s website at: http://www.sos.ca.gov/elections/elections_

elections.htm.
11

advocacy support of the loser. Id. at 26, 30, 31, 36. Indeed,

in the 2004 general election in the 76th Assembly District,

the winner was supported by only $24,108 in independent

spending, while the loser benefited from $906,145, or forty

times more. Id. at 30.

The report identified just three races in which

independent spending allegedly “may” have provided the

margin of victory. Id. at 37-40. It apparently reasoned that,

because these races were close, the large independent

expenditures may have swayed enough voters to tip the

outcome. If this tenuous inference were accurate, it would

not matter since “the fact that advocacy may persuade

the electorate is hardly a reason to suppress it.” Bellotti,

435 U.S. at 790-91. There was no claim or showing that, in

these races, other voices were not also heard. In short,

the report does not show – and actually refutes – any claim

that corporate wealth dominates or distorts California

elections.

The aggregate numbers in California tell a similar

story. According to a 2009 FPPC report entitled The

Billion Dollar Money Train (at 10, 24),8

 California

candidates and officeholders raised over $721 million for

their campaigns from January of 2001 until December of

2008. During that same period, independent expenditures

from all sources amounted to less than one-sixth of that

amount, or approximately $110 million.

The State of Washington also allows independent

corporate campaign advocacy. Washington’s Public

Disclosure Commission collected data on spending in 2008

8. Available at: http://www.fppc.ca.gov/reports/billion_

dollar_money_train.pdf.
12

legislative and executive elections.9

 Legislative candidate

campaigns spent $21,127,152. By comparison, total

independent expenditures from all sources supporting or

opposing candidates was $2,179,447. State executive

candidates and campaigns spent $31,693,004. Independent

expenditures supporting and opposing candidates totaled

$21,279,612. As with California, there was no showing that

corporate spending dominated or distorted the elections.

In sum, for the 19 years since Austin, a majority of

the states have continued to allow corporations to spend

freely on independent candidate advocacy. Contrary to

Austin’s hypothesis, there is no evidence that elections in

those states have been corroded and distorted by immense

corporate wealth. Indeed, the Government’s supplemental

brief no longer defends a distortion rationale.

C. Austin’s Professed Concern With Preventing

“Distortion” Really Is A Constitutionally

Forbidden Effort To “Level The Playing Field.”

Austin never clearly explained the “distorting effects”

that it feared from advocacy funded by “immense

aggregations” of corporate wealth. 494 U.S. at 660. Its basic

concern, however, was that corporations could “unfairly”

dominate “in the form of independent expenditures.” Id.

In other words, some speakers and ideas would receive

more support than others.

However, efforts to “level the playing field” by hobbling

speakers with greater assets are forbidden by the

First Amendment. Buckley rejected any compelling

9. The data is available at: http://www.pdc.wa.gov/

QuerySystem/candidates.aspx. 
13

governmental interest “in equalizing the relative ability of

individuals and groups to influence the outcome of

elections.” 424 U.S. at 48-49. Its holding was strongly

reaffirmed in Davis v. FEC, 128 S. Ct. 2759 (2008) (noting

the “ominous implications” of leveling). See Samuel Gedge,

Comment, “Wholly Foreign to the First Amendment”: The

Demise of Campaign Finance’s Equalizing Rationale in

Davis v. Federal Election Commission, 32 Harv. J. L. &

Pub. Pol’y 1197 (2009).

Davis is striking because the imbalance involved

candidate spending central to the campaign. By contrast,

this case involves independent speech, not coordinated with

any candidate. Moreover, in Davis the candidate’s great

wealth derived from his successful corporation – I Squared

R Element Co. See id. at 1206. Yet his benefit from

exploiting the corporate structure was not proffered as a

reason to subject him to “leveling.”

Thus, Austin’s speculative “compelling interest” boils

down to “leveling,” which the First Amendment forbids.

D. Austin’s Professed Interest In Limiting

Corporate Speech To Ideas The Public Supports

Is Contrary To The First Amendment.

Austin comments that corporate advocacy may “have

little or no correlation to the public’s support for the

corporation’s political ideas” and praises the speech ban

for “ensur[ing] that expenditures reflect actual public

support for the political ideas espoused by corporations.”

494 U.S. at 660. Throughout history, many governments

have sought to limit independent speech to ideas the public
14

already supports.10 But the First Amendment’s vision

assures competing views on public issues from “diverse

and antagonistic sources.” Associated Press v. United

States, 326 U.S. 1, 20 (1945). Austin’s endeavor to ensure

that corporations say only those things the public already

supports is another reason it should be overruled.

III. AUSTIN’S CATEGORICAL BAN ON CORPORATE ADVOCACY IS NOT NARROWLY

TAILORED TO PREVENT GREAT WEALTH

FROM DISTORTING ELECTIONS.

The “compelling” interest Austin relies upon is “the

corrosive and distorting effects of immense aggregations

of wealth . . . when it is deployed in the form of

independent expenditures.” 494 U.S. at 660. Yet the

remedy it approves is not narrowly tailored to address such

wealth.

After all, most corporations are of modest size and

wealth. According to the Small Business Administration,

56% of new employer businesses close within four years,

and more than 70% close within seven years.11 If the mere

10. Austin does not find that protecting dissenting

shareholders is a compelling interest. 494 U.S. at 663. It mentions

that issue only to distinguish MCFL, 479 U.S. at 263, in which

the basic rule later adopted by Austin was not challenged.

Proper use of corporate assets is a matter of internal corporate

governance. The government has shown no compelling need to

resort to categorical bans on core corporate speech. Bellotti,

435 U.S. at 794-95. Given the wide range of political corporate

speech protected by Bellotti and WRTL II, a ban on candidate

advocacy is underinclusive and untailored.

11. U.S. Small Business Administration, FAQs: Frequently

Asked Questions, Sept. 2008, at 1, http://www.sba.gov/advo/stats/

sbfaq.pdf.
15

fact of incorporation guaranteed vast wealth, those figures

would be very different. Few of the successful florists, retail

shops, restaurants, service stations, and myriad other

commonly incorporated businesses that surround us have

aggregated immense wealth. The same is true of the 96%

of the Chamber’s members that have fewer than 100

employees. In short, immensely wealthy corporations are

very much the exception, rather than the rule.

At the same time, immensely wealthy individuals play

a significant role in our political process.12 For example,

during the 2003-04, 2005-06, and 2007-08 election cycles,

the following individuals made the following donations to

other organizations to fund their independent advocacy,

drawing on personal wealth derived from business

corporations:

12. This Court recently dealt with issues arising from large

sums spent by an individual in a state judicial race. Caperton v.

A.T. Massey Coal Co., Inc., 129 S. Ct. 2252 (2009). Although

that individual’s wealth derived from a corporation, the Court

did not suggest that the speech should or could have been

banned. Instead, it adopted the tailored remedy of judicial

disqualification.
16

Spending By Wealthy Individuals

For Independent Advocacy 2003-0813

Donor Amount 2003-08 Corporation

George Soros $36,600,000 Soros Fund

Management LLC

Peter Lewis $25,000,000 Progressive Casualty

Insurance Company

Stephen Bing $19,000,000 Shangri-La

Entertainment

Bob Perry $18,900,000 Perry Homes

Herbert & Marion $13,700,000 Golden West Financial

Sandler Corporation

Jerrold Perenchio $10,200,000 Univision

Linda Pritzker $5,900,000 Hyatt & Marmon

Alida Messinger $5,000,000 Rockefeller heir

(Standard Oil)

Sheldon Adelson $4,300,000 Las Vegas Sands Corp.

Carl Lindner $4,000,000 American Financial

Group

13. Matt Kelley and Fredreka Schouten, Wealthy Few Provide

Cash for Independent Political Groups, USA Today, July 22, 2008,

available at http://www.usatoday.com/news/politics/election2008/

2008-07-21-donorinside_N.htm. In this and the next table, listed

corporations are those commonly identified as the foundation of

the donor’s wealth, though many wealthy persons have complex

investments.
17

Similarly, this table lists some candidates with

corporation-based wealth and their personal spending

directly on identified campaigns:

Personal Funds Spent By Wealthy Candidates 14

Name Race Amount Corporation

Jon Corzine 2000 Sen. N.J. $63,000,000 The Goldman

2005 Gov. N.J. $43,000,000 Sachs Group, Inc.

Michael 2001 NYC $73,000,000 Bloomberg L.P.

15

Bloomberg Mayor

2005 NYC $85,000,000

Mayor

14. 10 Candidates Who Spent Giant Sums of Their Personal

Wealth, Real Clear Politics, July 9, 2009, http://www.realclear

politics. com/lists/candidate_ spenders. This list is not exhaustive.

Other candidates for state office have spent more than $20 million

on their campaigns, including: Tom Golisano ($100 million on three

New York gubernatorial bids, plus $5 million for other state

campaigns, Paychex, Inc.); Tony Sanchez ($60 million in a 2002 bid

for Texas Governor, Sanchez Oil & Gas Corporation); and Al

Checchi ($40 million in the 1998 California Democratic primary

for Governor, Northwest Airlines). Tom Precious, Golisano Bids

to Finance Reforms, Buffalo News, July 9, 2008; R.G. Ratcliffe,

Millionaires Gave a Third of All Money Raised for ’06 State Races,

Houston Chronicle, Sept. 27, 2007; Norman Solomon, Calculating

How Much Candidates Spend for Every Vote, Cleveland Plain

Dealer, June 5, 1998.

15. It is an interesting question whether Austin’s holding

applies to a limited partnership. In any event, Bloomberg L.P. holds

ownership interests in business corporations.
18

Jay 1984 Sen. $9,000,000 Rockefeller heir

Rockefeller W. Va. (Standard Oil)

Jared Polis 2008 Cong. CO $5,992,550 Provide

Commerce, Inc.

Herb Kohl 1988 Sen. WI $7,491,000 BATUS Inc.

1994 Sen. WI $6,500,000 & Kohl’s

2000 Sen. WI $5,000,000

2006 Sen. WI $6,000,000

Michael 1994 Sen. CA $28,000,000 Huffco

Huffington

Ross Perot 1992 President $63,500,000 EDS

Steve Forbes 1996 President $37,900,000 Forbes, Inc.

2000 President $38,700,000

Ned Lamont 2006 Sen. CT $12,700,000 J.P. Morgan & Co.

(heir)

Blair Hull 2004 Sen. IL $28,000,000 Hull Trading

Company

In short, banning speech by corporations is not a

tailored way to address the effects of wealth on elections,

assuming “distortion” is a compelling justification for a

ban. Attempting a work-around, Austin stated that all

corporations benefit from “the unique state-conferred

corporate structure that facilitates the amassing of large

treasuries [and this] warrants the limit.” 494 U.S. at 660.

On that theory, Austin ruled that the categorical ban

was “precisely targeted to eliminate the distortion

caused by corporate spending.” Id.
19

But immense wealth cannot distort until it first has

been aggregated and spent. Austin actually recognizes

as much, saying that “corporate wealth can unfairly

influence elections when it is deployed.” Id. (emphasis

added). Banning all corporate candidate advocacy

because some corporations some day may become

wealthy is not a tailored response to distortions caused

by the spending of great wealth.

IV. THIS IS A PROPER CASE IN WHICH TO

OVERRULE AUSTIN.

To defeat this “as applied” challenge, “the

Government must prove that applying [the challenged

statute to Citizens United] furthers a compelling

interest and is narrowly tailored . . . .” WRTL II, 127

S.Ct. at 2664. The Jurisdictional Statement brought that

issue before this Court, asking if Citizens United’s

speech was properly “subject to regulation as an

electioneering communication,” and it now has been fully

briefed. To meet its burden, the Government argued

that, because Citizens United is a corporation and

received corporate funds, suppressing its speech is

justified by the compelling interest and categorical ban

approved by Austin. Brief for the Appellee at 15. Thus,

the Government placed Austin at issue.

As demonstrated above, Austin is deeply flawed,

irreconcilable with settled precedent, and deprives the

public of core speech by a wide range of corporations.

Rather than building a Rube Goldberg edifice based on

special (and disputed) characteristics of Citizens United

– defeating the “imperative for clarity,” WRTL II, 127

S. Ct. at 2669 n.7 – the Court should rule that Austin
20

erred and that the fact that a speaker is a corporation

is not a constitutional basis for suppressing its

independent political speech. Such a holding will provide

full relief to Appellant and correct the ongoing First

Amendment injury Austin is inflicting on the public,

which is being deprived of the views of the Chamber, its

corporate members, and corporations generally.

Overruling any holding of this Court is a serious

step. At the same time, the Court recognizes its special

obligation to assure that its constitutional holdings,

which are not subject to correction by anyone else, are

faithful to the Constitution the Court is sworn to uphold.

See Smith v. Allwright, 321 U.S. 649, 665 (1944); Burnet

v. Coronado Oil & Gas Co., 285 U.S. 393, 406-07, 410

(1932) (Brandeis, J., dissenting). Where a constitutional

ruling is “badly reasoned” or rests on “a misreading of

precedent,” this Court “has never felt constrained” to

perpetuate constitutional error. Seminole Tribe of Fla.

v. Florida, 517 U.S. 44, 63 (1996) (collecting authority);

Allwright, 321 U.S. at 665 (overruling is particularly

appropriate where the error lies in applying a

constitutional principle, rather than in discerning it).

Instead, the proper step is to overrule the erroneous

decision and restore the constitutional rights of

appellant and many others. See Agostini v. Felton, 521

U.S. 203, 239 (1997) (declining to wait for a “better

vehicle”).
21

CONCLUSION

For the foregoing reasons, Austin should be

overruled and the Court should hold that the facts that

Appellant Citizens United is incorporated and has

received money from business corporations provide no

basis for restricting its core First Amendment right to

engage in independent electoral advocacy.

Respectfully submitted,

JAN WITOLD BARAN

Counsel of Record

THOMAS W. KIRBY

CALEB P. BURNS

WILEY REIN LLP

1776 K Street, N.W.

Washington, D.C. 20006

(202) 719-7000

STEVEN J. LAW

Chief Legal Officer and

General Counsel

JUDITH K. RICHMOND

Vice President and

Associate General Counsel

U.S. CHAMBER OF COMMERCE

1615 H Street, N.W.

Washington, D.C. 20062

(202) 463-5576

Counsel for Amicus Curiae

ROBIN S. CONRAD

AMAR D. SARWAL

NATIONAL CHAMBER

LITIGATION CENTER, INC.

1615 H Street, N.W.

Washington, D.C. 20062

(202) 463-5337