Since the Supreme Court's seminal campaign finance ruling in Buckley v. Valeo, (1) the Court continues to disagree over the best way to balance First Amendment free speech rights against the state's interest in fighting the reality or appearance of corruption caused by sizeable campaign expenditures. (2) The debate over corporate campaign expenditures has been a source of particularly sharp disagreement, generating at least six major decisions since the Court's ruling in Buckley. (3) In two recent decisions, the Court held that although corporations could use money in separate political funds for campaign spending, general treasury funds were off limits. (4) In Citizens United v. FEC, (5) however, the Supreme Court expanded corporate campaign spending power by holding that, although "It]he government can regulate corporate political speech through disclaimer and disclosure requirements," it is unconstitutional for the government to suppress corporate political speech entirely. (6) In doing so, the Court struck down parts of the two previous decisions (7) that limited the ability of corporations to spend money on electioneering communications in federal elections. Although it is too soon to know what effect the Court's decision will have on the electoral process, Citizens United likely will be most significant not for what it means for corporate campaign spending, but for what it signals for the future of campaign finance reform. Not only does the ruling mark the first time that the Roberts Court has struck down a previous campaign finance decision, but also it does so in a way that signals the Court's newfound hostility toward campaign finance regulation in all but the most limited of circumstances.
Citizens United is a nonprofit corporation that receives funds from both individuals and for-profit corporations. (8) In 2008, Citizens United created Hillary: The Movie, a ninety-minute documentary about then-Senator and presidential candidate, Hillary Clinton, and sought to expand the film's distribution by using cable video-on-demand offerings in addition to movie theater and DVD releases. (9) The Bipartisan Campaign Reform Act of 2002 (BCRA), (10) however, barred the use of corporate general treasury funds for electioneering communications. (11) The law did not, however, bar spending by segregated corporate or union funds through the use of political action committees (PACs). (12) Because Citizens United feared that its plans to make Hillary available through video-on-demand before certain 2008 presidential primaries ran afoul of the corporate expenditure prohibition contained in [section] 441b, it sought to have the federal ban as well as the disclaimer and disclosure requirements related to those corporate expenditures declared unconstitutional as applied to Hillary. (13)
The district court denied Citizens United's motion for a preliminary injunction and granted the government's motion for summary judgment, holding that the corporate expenditure ban was facially constitutional based on the Supreme Court's ruling in McConnell v. FEC, (14) which, in turn, relied on the Court's earlier holding in Austin v. Michigan State Chamber of Commerce. (15) Citizens United appealed its case to the Supreme Court. (16) Following the initial arguments in the case in October Term 2008, the Supreme Court ordered the parties to file supplemental briefs and reargue the case to address whether the Court should overrule Austin and the part of McConnell that addressed the facial validity of [section] 441b. (17)
The Supreme Court held five to four that the government could not prohibit corporate-funded independent expenditures. (18) Writing for the majority, Justice Kennedy (19) wrote that "the Government may not suppress political speech on the basis of the speaker's corporate identity" because "[n]o sufficient governmental interest justifies limits on the political speech of nonprofit or for-profit corporations." (20) With an even larger eight-to-one majority, the Court (21) held that disclaimer and disclosure requirements related to campaign communications were constitutional. …