No. 08-205 

================================================================ 

In The 

Supreme Court of the United States 

--------------------------------- ♦ --------------------------------- 

CITIZENS UNITED, 

Appellant, 

v. 

FEDERAL ELECTION COMMISSION, 

Appellee. 

--------------------------------- ♦ --------------------------------- 

On Appeal From The 

United States District Court 

For The District Of Columbia

--------------------------------- ♦ --------------------------------- 

BRIEF OF AMICUS CURIAE

AMERICAN INDEPENDENT BUSINESS ALLIANCE 

IN SUPPORT OF APPELLEE 

ON SUPPLEMENTAL QUESTION 

--------------------------------- ♦ --------------------------------- 

DANIEL J.H. GREENWOOD

HOFSTRA UNIVERSITY SCHOOL

OF LAW

121 Hofstra University 

Room 108 

Hempstead, NY 11549 

(516) 463-7013 

BRENDA WRIGHT

Counsel of Record

LISA J. DANETZ

DE ̄MOS

358 Chestnut Hill Avenue

Suite 303 

Brighton, MA 02135 

(617) 232-5885 

ALLEGRA CHAPMAN

DE ̄MOS

220 Fifth Avenue 

Fifth Floor 

New York, NY 10001 

(212) 419-8772 

================================================================ COCKLE LAW BRIEF PRINTING CO. (800) 225-6964 

OR CALL COLLECT (402) 342-2831 
i 

QUESTION PRESENTED

 Whether, for the proper disposition of this case, 

the Court should 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. 
ii 

TABLE OF CONTENTS 

Page 

Table of Authorities ............................................. iii 

Interest of Amicus Curiae.................................... 1 

Summary of Argument ........................................ 2 

Argument ............................................................. 4 

THE COURT SHOULD NOT OVERRULE 

AUSTIN OR MCCONNELL BECAUSE BOTH 

DECISIONS PROPERLY RECOGNIZE THE 

FUNDAMENTAL DIFFERENCES BETWEEN 

CORPORATIONS AND INDIVIDUALS WITH 

RESPECT TO FIRST AMENDMENT PROTECTIONS FOR PARTICIPATION IN ELECTORAL CAMPAIGNS ....................................... 4 

 A. Because Corporate “Speech” Is Legally 

Constrained and Does Not Reflect Views 

of Any Citizen, Business Corporations Do 

Not Have a Legitimate Claim to First 

Amendment “Expressive” Protection as 

Speakers in the Marketplace of Ideas ....... 4 

 B. Corporate Electoral Participation Interferes with Republican Self-Government, 

Contrary to the First Amendment’s Political Goals ................................................... 9 

 C. Corporate Participation in Candidate 

Campaigns Promotes Market Entrenchment, Contrary to First Amendment 

Goals of Self-Governance ........................... 16 

Conclusion............................................................ 20 
iii 

TABLE OF AUTHORITIES 

Page 

CASES

Austin v. Michigan Chamber of Commerce, 494 

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

California Medical Association v. FEC, 453 

U.S. 182 (1981) ........................................................ 12 

Cohen v. California, 403 U.S. 15 (1971) ...................... 8 

Corbin v. Corbin, 429 F. Supp. 276 (D.C. Ga. 

1977) .......................................................................... 7 

Dodge v. Ford Motor Co., 170 N.W. 668 (Mich. 

1919) ...................................................................... 5, 9 

FEC v. Massachusetts Citizens for Life, Inc., 

479 U.S. 238 (1986) ........................................... 12, 16 

FEC v. Nat’l Right to Work Committee, 459 

U.S. 197 (1982) .............................................. 2, 13, 14 

First Nat’l Bank of Boston v. Bellotti, 435 U.S. 

765 (1978) ................................................................ 15 

Gilbert v. Norfolk & W. Ry. Co., 171 S.E. 814 

(W. Va. 1933) ............................................................ 10 

Home Ins. Co. v. State of New York, 119 U.S. 

129 (1886) ................................................................ 14 

Lochner v. New York, 198 U.S. 45 (1905) ................... 19 

McConnell v. FEC, 540 U.S. 93 (2003) ..... 2, 4, 11, 17, 20 

McConnell v. FEC, 251 F. Supp. 2d 176 (D.D.C. 

2003) ........................................................................ 17 

Michelson v. Duncan, 407 A.2d 211 (Del. 1979) .......... 9 
iv 

TABLE OF AUTHORITIES – Continued 

Page 

Minneapolis & St. L. Ry. Co. v. Beckwith, 129 

U.S. 26 (1889) .......................................................... 14 

Missouri Pac. Ry. Co. v. Mackey, 127 U.S. 205 

(1888) ....................................................................... 14 

Pacific Gas & Electric Co. v. Public Utilities 

Comm’n of California, 475 U.S. 1 (1986) ............... 13 

Police Dep’t of Chicago v. Mosley, 408 U.S. 92 

(1972) ......................................................................... 8 

Santa Clara County v. Southern Pac. RR Co., 

118 U.S. 394 (1886) ........................................... 13, 14 

Spiegel v. Buntrock, 571 A.2d 767 (Del. 1990) ............. 5 

Union Pac. RR Co. v. Trustees, Inc., 329 P.2d 

398 (Utah 1958) ...................................................... 10 

UNITED STATES CONSTITUTION

U.S. Const. amend. I .......................................... passim

U.S. Const. amend. XIV ....................................... 13, 14 

U.S. Const. amend. XIV § 1 ........................................ 14 

U.S. Const. amend. XIV § 2 ........................................ 14 

STATUTES

Bipartisan Campaign Reform Act of 2002, 

§ 203 .......................................................................... 2 

Labor Management Relations Act, 1947, ch. 

120, § 304, 61 Stat. 159 ........................................... 15 
v 

TABLE OF AUTHORITIES – Continued 

Page 

Tillman Act, 1907, ch. 420, 34 Stat. 864 .................... 15 

2 U.S.C. § 441b ........................................................... 15 

REGULATIONS

Securities Exchange Act Rule 14a-8(i), 17 C.F.R. 

§ 240.14a-8(i) ............................................................. 5 

OTHER AUTHORITIES

Am. Law Inst., 1 Principles of Corp. Governance (1994) ...................................................... 10, 11 

Tom Bennigson, Nike Revisited: Can Commercial Corporations Engage in Non-Commercial 

Speech?, 39 Conn. L. Rev. 379 (2006) ....................... 8 

Victor Brudney, Business Corporations and 

Stockholders’ Rights under the First Amendment, 91 Yale L. J. 235 (1981) ................................. 16 

Jesse Drucker, Wal-Mart’s State Tax Evasion 

Ploy: Paying Rent to Itself, The Wall Street 

Journal, Feb. 1, 2007 .............................................. 18 

Thomas I. Emerson, Toward A General Theory 

of the First Amendment (1966) ................................ 9 

Pallavi Gogoi, Wal-Mart Courts State Politicos: 

A new report shows that Wal-Mart has jacked 

up political contributions in states where it 

wants to reduce its tax bill, Business Week, 

October 26, 2007 ..................................................... 18 
vi 

TABLE OF AUTHORITIES – Continued 

Page 

Daniel J.H. Greenwood, Essential Speech: Why 

Corporate Speech Is Not Free, 83 Iowa L. Rev. 

995 (1998) .................................................. 7, 8, 10, 12 

Thom Hartmann, Unequal Protection: The Rise 

of Corporate Dominance and the Theft of 

Human Rights (2002) .............................................. 13 

Mary Hendrickson and William Heffernan, 

Concentration of Agriculture Markets, April 

2007, available at http://civileats.com/wpcontent/uploads/2009/05/2007-heffernanreport. 

pdf ............................................................................ 18 

Robert Michels, Political Parties: A Sociological 

Study of the Oligarchical Tendencies of Modern Democracy (Eden and Cedar Paul trans., 

Hearst’s Intl. Library Co. 1915) ............................. 11 

Adam Winkler, McConnell v. FEC, Corporate 

Political Speech, and the Legacy of the Segregated Fund Cases, 3 Elec. L. J. 361 (2004) ............ 14 
1 

INTEREST OF AMICUS CURIAE1

The American Independent Business Alliance 

(AMIBA) is a U.S. non-profit organization helping 

communities design and implement programs to 

support independent locally-owned businesses and 

maintain ongoing opportunities for entrepreneurs. 

AMIBA also engages in public education to raise 

awareness of the economic, civic, environmental and 

cultural importance of community-based enterprise. 

 AMIBA supports 65 affiliates (community organizations) across 31 states and has helped many more 

cities and towns with programs to support their local 

independents. AMIBA’s affiliates represent approximately 15,000 independent businesses covering 

virtually every sector of business, many of which face 

direct competition from chains and other large 

corporations. Many large corporations have converted 

their economic power into political favors that extract 

subsidies from taxpayers, stifle enforcement of antitrust laws, create legal tax evasion opportunities, and 

other rules that disadvantage small business and the 

constituents of AMIBA affiliates. AMIBA maintains 

that enabling corporations to further increase their 

1

 Pursuant to Rule 37.6, counsel for Amicus state that they 

authored this brief, and that this brief was not authored by 

counsel for any party. No person or entity other than Amicus 

and its counsel made a financial contribution to this brief. 

Consent to the filing of briefs amicus curiae has been granted by 

counsel for appellee, as indicated on this Court’s docket. A letter 

of consent by appellant has been filed with this Court. 
2 

political power would harm the political process and 

undermine genuine market competition. Political 

freedom and the dignity of citizens are threatened far 

more by treating corporate entities as if they were 

real citizens than by upholding common-sense, 

democratically enacted rules limiting participation by 

for-profit corporations in electoral campaigns. AMIBA 

therefore urges that this Court should not overrule its 

decision in Austin v. Michigan Chamber of Commerce, 

494 U.S. 652 (1990), nor the portion of McConnell v. 

FEC, 540 U.S. 93 (2003), upholding Section 203 of the 

Bipartisan Campaign Reform Act of 2002 as facially 

valid. 

--------------------------------- ♦ ---------------------------------

SUMMARY OF ARGUMENT 

This Court’s decisions in Austin and McConnell

both are premised on the long-standing recognition 

that “the special characteristics of the corporate 

structure require particularly careful regulation” 

with respect to corporate participation in the electoral 

process. FEC v. Nat’l Right to Work Committee 

(“NRWC”), 459 U.S. 197, 209-210 (1982). The request 

to overrule those decisions purports to bring into play 

not merely the question whether and under what 

conditions non-profit, expressly ideological corporations require First Amendment protection for the 

use of corporate funds in elections, but whether the 

deployment of huge corporate treasuries amassed 

through for-profit activities may ever be treated 

differently from individual citizen participation in 
3 

electoral campaigns. Supplemental Brief for Appellant at 3, 6-9. Accordingly, the wisdom of overruling 

those decisions must be evaluated by understanding 

the structure and role of large, publicly traded 

corporations and the implications of according these 

artificial entities the same protections for electoral 

participation that are enjoyed by citizens. 

 The governance system of such corporations is 

highly successful for the pursuit of profit, making 

them important instruments in the economic sphere. 

But the very factors that make the corporate form an 

effective instrument of wealth accumulation are the 

factors that make it inappropriate for corporations to 

claim the full panoply of First Amendment protections for political speech and participation that are 

enjoyed by natural persons. Because of the way 

corporations are structured, corporate speech does 

not express the political views of any individual or 

group of individuals associated with the corporation. 

Moreover, the constraints that drive a corporation’s 

political speech – the requirement that corporate 

actions all must be calibrated toward profit – directly 

undermine the notion that a corporation can be a free 

participant in the marketplace of ideas. And precisely 

because a corporation enjoys significant state-created 

economic advantages designed for the narrow purpose 

of furthering wealth-accumulation, corporate participation in candidate campaigns promotes market entrenchment and corrupts the political marketplace in 

a fundamentally undemocratic manner. 

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4 

ARGUMENT 

THE COURT SHOULD NOT OVERRULE 

AUSTIN OR MCCONNELL BECAUSE BOTH 

DECISIONS PROPERLY RECOGNIZE THE 

FUNDAMENTAL DIFFERENCES BETWEEN 

CORPORATIONS AND INDIVIDUALS WITH 

RESPECT TO FIRST AMENDMENT PROTECTIONS FOR PARTICIPATION IN ELECTORAL 

CAMPAIGNS. 

A. Because Corporate “Speech” Is Legally 

Constrained and Does Not Reflect Views of 

Any Citizen, Business Corporations Do Not 

Have a Legitimate Claim to First Amendment “Expressive” Protection as Speakers 

in the Marketplace of Ideas. 

An understanding of the structure and role of 

large, publicly traded companies confirms the wisdom 

of the long-standing distinction that Congress, the 

states and this Court have drawn between electoral 

participation by individuals and electoral participation by state-created, for-profit corporations. 

 Publicly traded corporations are among our most 

important institutions for wealth accumulation. State 

law structures business corporations to enable them 

to accumulate large quantities of capital in order to 

create jobs and produce useful goods and services. 

 Corporations are regulated internally largely by 

state law fiduciary duties that require the various 

people working for them (employees, managers and 

other agents) and their governing board of directors 
5 

to act in the corporation’s interest as defined by state 

law. Critically, state law demands that managers use 

corporate funds to act in the interest of securing 

financial return. See, e.g., Dodge v. Ford Motor Co., 

204 Mich. 459, 507, 170 N.W. 668, 684 (Mich. 1919) 

(“A business corporation is organized and carried on 

primarily for the profit of the stockholders. The 

powers of the directors are to be employed for that 

end.”). 

 Because a business corporation’s speech is the 

result of legally imposed fiduciary duties, corporate 

speech cannot be said to express the autonomous 

political views of any individual or group of individuals associated with the corporation, whether as 

shareholder, manager, customer, or employee. 

 Corporate advocacy certainly does not reflect the 

political views of shareholders (many of which, in any 

event, are themselves highly regulated legal entities 

rather than autonomous human citizens). Indeed, 

corporate law generally bars shareholders from directing business decisions of the corporation. See, e.g., 

Spiegel v. Buntrock, 571 A.2d 767, 772-73 (Del. 1990) 

(“A basic principle of the General Corporation Law of 

the State of Delaware is that directors, rather than 

shareholders, manage the business and affairs of the 

corporation.”); Securities Exchange Act Rule 14a-8(i), 

17 C.F.R. § 240.14a-8(i) (listing numerous grounds on 

which corporations may exclude shareholder proposals from proxy statements). Thus, if a corporation 

deploys corporate funds in electoral campaigns, the 

business decision on how best to deploy such funds is 
6 

not dictated by the political views of any individual 

shareholder or group of shareholders, but instead is 

determined by management.2 

2

 Electoral spending to enhance shareholder profit cannot 

be deemed shareholder speech merely by adopting the fiction 

that shareholders abandon all interests apart from profit 

maximization when they become shareholders: 

[O]ne might say that whatever else shareholders want 

in the rest of their lives, surely they all want higher 

share values. But human shareholders who are also 

neighbors or employees or customers or friends may 

have other commitments beyond an extra nickel in 

the quarterly dividend. Even on purely economic 

issues, since shareholdings in this country are not 

only wide but shallow, many shareholders will find 

that their basic interests are aligned more with 

employees, stability or customers than with the 

highest possible value for their shareholdings: a 

decrease in your phone bill is likely to be worth more 

to you than the commensurate drop in the price of the 

telephone company shares held by your pension fund. 

Only foreign shareholders with little connection to the 

American economy or politics beyond their shareholdings approximate this conventional image of a 

shareholder always interested in higher stock returns. 

* * * 

The humans who stand behind the shares have 

various and conflicting goals, as all people do: they 

want their shares to increase in value, of course, but 

they may also want decent jobs for their kids or 

neighbors, attractive and safe cities, a clean 

environment, and other things that, from time to 

time, conflict with the increase in value of their 

shares. The corporate law system eliminates all these 

conflicting goals, leaving the agents with a simple and 

clear directive: maximize shareholder value. 

(Continued on following page) 
7 

 But that does not mean that corporate political 

participation can be understood to express the 

political views of corporate officers. A corporate officer 

would be violating her fiduciary duty to shareholders 

if she permitted her own political views and interests 

to determine how she spends corporate general 

treasury funds. Corbin v. Corbin, 429 F. Supp. 276, 

281 (M.D. Ga. 1977) (corporate funds “cannot be used 

to meet an officer’s personal desires”). 

 Moreover, the fiduciary duty to deploy corporate 

funds in the interest of the corporation does not even 

mean that a corporate officer may direct corporate 

electoral spending according to her understanding of 

the political views of shareholders (even assuming 

such preferences could be determined in any practical 

manner). The duty of the corporate officeholder is to 

maximize corporate profit, not to represent shareholder preferences regarding candidates for office. 

Corporate managers have neither the right nor the 

ability to determine how the real human citizens 

behind their shares would balance corporate profits 

against other individual or social goals. 

 Nor is there any credible argument that 

corporate political speech can be thought to express 

the political views of employees or customers, either 

individually or as a group. While those groups are the 

Daniel J.H. Greenwood, Essential Speech: Why Corporate Speech 

is Not Free, 83 Iowa L. Rev. 995, 1036-37, 1040-41 (1998) 

(hereafter, “Greenwood, Essential Speech”). 
8 

primary source of any successful corporation’s funds, 

neither has the ability to direct corporate electoral 

speech. Tom Bennigson, Nike Revisited: Can Commercial Corporations Engage in Non-Commercial 

Speech?, 39 Conn. L. Rev. 379, 411-412 (2006); 

Greenwood, Essential Speech, at 1052. 

 In short, corporate speech is the result of officials 

acting in accord with their legally imposed duties, 

without reflecting the commitments of any individual 

citizen or group of citizens. Corporate campaign 

expenditures are the result of fiduciary law and 

bureaucratic imperative, not of expression by any of 

the people affiliated with the corporation. 

 Consequently, the individualistic, anti-majoritarian 

aspects of First Amendment protections are completely inapplicable to corporate electoral spending. 

First Amendment protections against majoritarian 

enactments have as an important goal the protection 

of free expression and individual autonomy as key 

attributes of the dignity of citizens. See, e.g., Police 

Dep’t of Chicago v. Mosley, 408 U.S. 92, 95-96 (1972) 

(noting that “right to express any thought, free from 

government censorship” is necessary “to assure selffulfillment for each individual” as well as “to permit 

the continued building of our politics and culture”); 

Cohen v. California, 403 U.S. 15, 24 (1971) (First 

Amendment places “the decision as to what views 

shall be voiced largely into the hands of each of us,” 

not only to promote a “more perfect polity,” but also 

“in the belief that no other approach would comport 

with the premise of individual dignity and choice 
9 

upon which our political system rests.”); Thomas I. 

Emerson, Toward a General Theory of the First 

Amendment 4-7 (1966). Because corporate speech in 

furtherance of the corporation’s legally imposed 

function is not the expression of anyone’s individual 

autonomy or dignity, this key rationale for First 

Amendment protection is unavailable as a basis for 

judicial intervention on behalf of corporate electoral 

participation. 

B. Corporate Electoral Participation Interferes 

with Republican Self-Government, Contrary 

to the First Amendment’s Political Goals. 

It is not merely the absence of individual 

expression when a corporation speaks, but also the 

absence of any choice about the goals that a corporation may pursue through its electoral spending, 

that differentiates corporate political participation from 

that of individuals or other organizations. Publicly 

traded business corporations are legally structured to 

be effective in economic markets. To be economically 

effective, they must act with a single voice toward a 

single goal – profit maximization – while setting 

aside the value conflicts that drive politics. Dodge v. 

Ford Motor Co., 170 N.W. at 684 (“the discretion of 

the directors is to be exercised in the choice of means 

to attain that end [the profit of the stockholders], and 

does not extend to a change in the end itself ”); 

Michelson v. Duncan, 407 A.2d 211, 217 (Del. 1979) 

(corporate expenditures not directed to enhancement 

of shareholder profit constitute “waste” of corporate 
10 

assets); Am. Law Inst., 1 Principles of Corp. Governance § 2.01 (1994) (corporate action should be directed 

“with a view to enhancing corporate profit and shareholder gain”). Thus, before the corporation enters the 

political arena, its choice of possible electoral goals 

has been narrowed by law to only one: the 

enhancement of corporate earnings. 

 For this reason, 

corporations entering the political sphere 

cannot be conceptualized as groups of 

citizens. Unlike groups of citizens, who must 

always debate the proper and shifting 

balance of conflicting values, corporations 

will pursue a single value to the detriment of 

all others. . . . The goal – increasing the 

value of the shares – is set and debate is 

restricted only to the technical issue of the 

best means to reach this destination[.] 

Greenwood, Essential Speech, at 1052.3

3

 Even when a corporation engages in activity related to the 

public welfare or for other reasons not directly business-related, 

a business-related motive for the conduct generally is required. 

See, e.g., Union Pac. RR Co. v. Trustees, Inc., 329 P.2d 398, 401 

(Utah 1958) (concluding that corporate directors would not have 

made contribution to non-profit organization “if they were not 

confident that their company, presently and directly . . . , would 

receive a quid pro quo as the resultant of good will engendered 

by contributions”); Gilbert v. Norfolk & W. Ry. Co., 171 S.E. 814, 

815 (W. Va. 1933) (“Consistent with the general rule that a 

private business corporation is carried on primarily for the profit 

of its stockholders, . . . it has, nevertheless, been generally held 

that such corporations may, for the ultimate benefit of the 

(Continued on following page) 
11 

 Corporate electoral speech thus differs fundamentally from the electoral speech of citizens. Of 

course, individuals may sometimes participate in 

politics with a single-issue focus. They may decide to 

base their electoral decisions solely on a candidate’s 

position on abortion, or on the environment, or health 

policy, and citizens often vote their business interests 

– but no individual is required by law to do so. Even 

the most single-minded individual may, in theory, be 

persuaded to embrace broader or different goals by 

other participants in the political marketplace. In 

contrast, publicly traded business corporations are 

legally bound to use their resources to enhance the 

profitability of the company, no matter how persuasive 

the arguments for a broader or conflicting set of 

priorities.4

 

corporation itself translated into profit, use the funds of such 

corporation for purposes which might appear directly to be 

charitable and humanitarian.”) (emphasis added); see also Am. 

Law Inst., 1 Principles of Corp. Governance § 2.01, comment f 

(commenting that most corporate conduct undertaken for 

legal, ethical, public welfare, humanitarian, educational, or 

philanthropic purposes is usually “consistent with economic selfinterest”). 

4

 This analysis does not apply to a not-for-profit corporation 

formed explicitly to represent citizens in a political controversy. 

When organizational funding comes from donations or missionrelated revenue rather than purely commercial sales of a 

product or service, the organization is fairly viewed as an 

“amplifier” for the speech of its (human) donors. McConnell v. 

FEC, 540 U.S. at 136. As with any organization, non-profits will 

simplify and change the views of their donors. See, Robert 

Michels, Political Parties: A Sociological Study of the 

(Continued on following page) 
12 

 Citizens participating in electoral debate, moreover, not only make their own judgments, but spend 

their own money. Corporate managers spend money 

that is not their own while setting aside their own 

judgment as to the ultimate merits of the political 

position they take. In effect, they act as agents for a 

legally mandated profit-maximization principle, not 

any human principals. Greenwood, Essential Speech 

at 1041. 

 Because of these fundamental differences 

between an individual’s participation in the electoral 

arena, and the participation of an artificial entity 

that is structurally and legally incapable of independently choosing the goal for its electoral advocacy, 

Austin and McConnell were correct in understanding 

that judicial intervention to protect the latter is not 

warranted in every circumstance where it might be 

justified to protect the former. See California Med. 

Assoc. v. FEC, 453 U.S. 182, 201 (1981) (“The differing 

restrictions placed on individuals and unincorporated 

associations, on the one hand, and on unions and 

corporations, on the other, reflect a judgment by 

Oligarchical Tendencies of Modern Democracy (Eden and Cedar 

Paul trans., Hearst’s Intl. Library Co. 1915) (describing how the 

views of leaders diverge from those of their supporters in the 

“iron law of oligarchy”). However, unlike publicly traded forprofit corporations, non-profit managers are managing funds 

donated specifically for the corporation’s cause – not accumulated due to economic activity. This Court’s precedents 

appropriately distinguish between the two. FEC v. Massachusetts 

Citizens for Life, Inc. (“MCFL”), 479 U.S. 238, 260-61 (1986). 
13 

Congress that these entities have differing structures 

and purposes, and that they therefore may require 

different forms of regulation in order to protect the 

integrity of the electoral process”); NRWC, 459 U.S. at 

210-11 (restriction on solicitation by non-profit, 

noncapital stock corporation for contributions to 

campaign committee permissible even though “governmental interest in preventing both actual corruption and the appearance of corruption . . . [was] 

accomplished by treating unions, corporations, and 

similar organizations differently from individuals.”) 

(emphasis added); Pacific Gas & Electric Co. v. Public 

Utilities Comm’n of California, 475 U.S. 1, 35 (1986) 

(Rehnquist, J., dissenting) (“The insistence on 

treating identically for constitutional purposes entities 

that are demonstrably different is as great a 

jurisprudential sin as treating differently those entities 

which are the same.”)5

5

 This case involves federal legislation challenged under the 

First Amendment. This makes it a particularly inappropriate 

vehicle to reconsider Austin, which arose under the Fourteenth 

Amendment and raises federalism issues not present here. 

Corporate due process rights are generally attributed to Santa 

Clara County v. Southern Pac. RR Co., 118 U.S. 394 (1886), 

although the relevant ruling appears only in the Reporter’s 

summary of oral argument and is entirely unreasoned. See 

Thom Hartmann, Unequal Protection: The Rise of Corporate 

Dominance and the Theft of Human Rights 106-108 (2002). No 

subsequent case has offered a reasoned explanation of how the 

language, structure or intent of the Fourteenth Amendment 

can be extended to protect corporations. Linguistically, while 

corporations are “legal persons” for some purposes, the plain 

meaning of “person” in the Fourteenth Amendment is human 

(Continued on following page) 
14 

 Requiring corporations to use segregated funds 

raised from like-minded officers and shareholders for 

electoral participation, instead of using the corporation’s general treasury funds – the requirement 

upheld in Austin and McConnell – enables individuals to associate for electoral goals that serve the 

corporation if they find those goals worthy of support. 

It accomplishes this, moreover, without enlisting the 

use of for-profit corporate general treasury funds for 

electoral expression that the shareholders, bondholders, customers or employees who created those 

funds may not support. See NRWC, 459 U.S. at 208 

(noting that restrictions on corporate or union 

electoral participation “protect the individuals who 

have paid money into a corporation or union for 

purposes other than the support of candidates from 

having that money used to support political 

candidates to whom they may be opposed”); Adam 

Winkler, McConnell v. FEC, Corporate Political Speech, 

beings: only humans are “born or naturalized,” U.S. Const. 

amend. XIV, § 1, and only humans qualify as “persons” for the 

Amendment’s Apportionment Clause, U.S. Const. amend. XIV, 

§ 2. Moreover, the first modern business corporate laws barely 

predate the Twentieth Century. It is implausible that the 

original intent of the Civil War Amendments (or the First 

Amendment) was to radically restrict future citizens’ ability to 

regulate a legal form that did not yet exist in its modern form. 

Perhaps recognizing Santa Clara’s weakness, the earliest cases 

following it permitted legislative classifications based in part on 

corporate status. See Minneapolis & St. L. Ry. Co. v. Beckwith, 

129 U.S. 26, 29 (1889); Missouri Pac. Ry. Co. v. Mackey, 127 U.S. 

205, 209-210 (1888); Home Ins. Co. v. State of New York, 119 U.S. 

129, 133 (1886). 
15 

and the Legacy of the Segregated Fund Cases, 3 Elec. 

L. J. 361 (2004) (noting long tenure of doctrine 

upholding segregated fund requirement for corporate 

and union political participation). 

 The arguments set forth above also show why the 

rights of listeners do not provide an adequate basis 

for judicial intervention to promote corporate general 

treasury spending in electoral campaigns. First Nat’l 

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

on the rights of listeners in the political marketplace 

in striking down a ban on corporate spending in a 

referendum campaign. But reliance on the rights of 

listeners should not be a sufficient basis to ignore the 

critical differences between corporations and individuals when it comes to participation in electoral 

campaigns. Nothing in Belloti, which addressed a 

complete ban on any corporate spending on the state 

referendum in question – even through a separate 

segregated fund – suggested that the First Amendment might bar the century old ban on direct 

corporate participation in federal election campaigns. 

See Tillman Act, 1907, ch. 420, 34 Stat. 864; see also

Labor Management Relations Act, 1947, ch. 120, 

§ 304, 61 Stat. 159; 2 U.S.C. § 441b. The right of 

individuals as individuals to direct their own political 

expenditures on electoral activity remains a compelling basis for requiring the use of segregated funds 

for corporate electoral participation.6 As Justice 

6

 In addition, for all the reasons noted earlier, the “volume” 

of corporate speech – its ability to be heard in the political 

(Continued on following page) 
16 

Brennan, a champion of the First Amendment, noted 

in Austin, “ ‘A’s right to receive information does not 

require the state to permit B to steal from C the 

funds that alone will enable B to make the communication.’ ” 494 U.S. at 675 (Brennan, J., concurring) 

(quoting Victor Brudney, Business Corporations and 

Stockholders’ Rights under the First Amendment, 91 

Yale L. J. 235, 247 (1981)). 

C. Corporate Participation in Candidate 

Campaigns Promotes Market Entrenchment, Contrary to First Amendment Goals 

of Self-Governance. 

Corporate assets result from prior success in the 

economic marketplace and the special privileges of 

state corporate law.7

 Corporate decision-makers will 

marketplace – has no relation to the level of commitment any 

individual may have to the speech. When a citizens individual 

spends funds in the electoral arena, the expenditure requires a 

personal sacrifice that presumably reflects the citizen’s genuine 

commitment to some electoral goal. Not so in managerially 

controlled business corporations; if managers believe in good 

faith that the corporate interest will be promoted by spending 

corporate money, they must do so, regardless of their, or anyone 

else’s, views of a fitting electoral goal. 

7

See, e.g., MCFL, 479 U.S. at 258 (“The resources in the 

treasury of a business corporation . . . are not an indication of 

popular support for the corporation’s political ideas. They reflect 

instead the economically motivated decisions of investors and 

customers. The availability of these resources may make a 

corporation a formidable political presence, even though the 

power of the corporation may be no reflection of the power of its 

ideas.”); Austin, 494 U.S. at 658-59 (“State law grants 

(Continued on following page) 
17 

use those assets to promote law that will grant the 

firm advantages in the next iteration of that marketplace. Incumbents, in other words, will seek to protect 

their incumbent privilege. This is as dangerous in the 

economic sphere as in the political sphere. The 

political First Amendment should protect the right of 

the people to control their institutions, even highly 

useful ones such as successful business corporations – 

not the ability of those institutions to escape political 

control. In a market economy, companies ought to 

compete based on their products and services, not the 

electoral clout corporate funds can buy, and the First 

Amendment should be no bar to the regulation 

necessary for vibrant economic competition. 

 The record before this Court in McConnell amply 

demonstrated the potential for the appearance and 

reality of electoral corruption created by corporate 

spending on electioneering communications in 

particular. McConnell v. FEC, 251 F. Supp. 2d 176, 

623-24 (D.D.C. 2003) (Kollar-Kotelly, J.). The problem 

of corruption is closely analogous to the equally 

serious problem of incumbent protection. 

 Our market system depends on competition and 

innovation. Those goals are threatened if the successful businesses of the last generation are allowed 

corporations special advantages – such as limited liability, 

perpetual life, and favorable treatment of the accumulation and 

distribution of assets – that enhance their ability to attract 

capital and to deploy their resources”). 
18 

(by this Court) and required (by state fiduciary law 

and market pressures) to use their accumulated 

wealth to elect politicians who can be counted on to 

enact laws to protect the incumbent corporations 

from upstart innovators. When one company can 

obtain special tax or regulatory treatment that its 

closely held competitors cannot, the free market itself 

suffers.8

 If we are to remain a democracy and if our 

8

 For example, family farmers and ranchers not only are 

handicapped by subsidies flowing to agribusiness, but also by 

non-enforcement of antitrust law. As a result, more than 83% of 

the beef packing industry nationally is controlled by four 

corporations (and the concentration typically is more extreme in 

any individual market, often leaving ranchers at the mercy of 

packers). Mary Hendrickson and William Heffernan, Concentration of Agriculture Markets, April 2007, available at http:// 

civileats.com/wp-content/uploads/2009/05/2007-heffernanreport. 

pdf. Similarly, tax loopholes benefiting many multi-state chains 

allow them to legally evade income taxes, thus penalizing the 

majority of independent competitors that operate within a single 

state. Shifting income across states through paying rent or 

licensing fees to subsidiary shell corporations is one such 

example perpetuated by corporations’ existing political 

influence. Pallavi Gogoi, Wal-Mart Courts State Politicos: A new 

report shows that Wal-Mart has jacked up political contributions 

in states where it wants to reduce its tax bill, Business Week, 

October 26, 2007. The Wall Street Journal reported that 

Walmart Stores Inc. avoids half its statutory income tax 

obligation by exploiting such loopholes. Jesse Drucker, WalMart’s State Tax Evasion Ploy: Paying Rent to Itself, The Wall 

Street Journal, Feb. 1, 2007. Such problems will only be 

compounded if this Court interprets the First Amendment to 

ban limits on the fiduciary obligations of corporate executives to 

use corporate treasury funds in electoral campaigns. 
19 

economy is to succeed, it is essential that the law 

structure the market and not the other way around. 

 Since the end of the Lochner era, this Court has 

recognized that Congress and the states, not the 

Court, are the appropriate bodies to determine the 

fundamentally political question of exactly where the 

economic marketplace ends and the political one 

begins. For all the reasons set forth here, the people 

acting through their elected representatives should 

retain the right to ensure that corporate electoral 

spending reflects the choices of individuals, through 

laws that require such spending be made through 

segregated PAC funds rather than from general 

treasury funds. 

--------------------------------- ♦ ---------------------------------
20 

CONCLUSION 

 The Court should not use this case to overrule 

Austin or the relevant portion of McConnell. The 

judgment of the district court should be affirmed. 

July 2009 Respectfully submitted,

 BRENDA WRIGHT

Counsel of Record

LISA J. DANETZ

DE ̄MOS

358 Chestnut Hill Avenue 

Suite 303 

Brighton, MA 02135 

(617) 232-5885 

ALLEGRA CHAPMAN

DE ̄MOS

220 Fifth Avenue 

Fifth Floor 

New York, NY 10001 

(212) 419-8772 

DANIEL J.H. GREENWOOD

HOFSTRA UNIVERSITY SCHOOL OF LAW

121 Hofstra University 

Room 108 

Hempstead, NY 11549 

(516) 463-7013 

Attorneys for Amicus Curiae