First National Bank of Boston v. Bellotti

Since the early 1900s, federal law has prohibited the use of corporate funds to influence federal elections.Greenwood, Daniel J. [http://people.hofstra.edu/daniel_j_greenwood/pdf/Bellotti.pdf Encyclopedia of the Supreme Court of the United States, s.v. “First National Bank v. Bellotti, 435 U.S. 765 (1978).] {{Webarchive|url=https://web.archive.org/web/20160303231245/http://people.hofstra.edu/daniel_j_greenwood/pdf/Bellotti.pdf |date=March 3, 2016 }} Detroit: Macmillan Reference USA, 2008. In 1907, Congress passed the Tillman Act, prohibiting corporations and national banks from contributing to federal campaigns.18 U.S.C. Sec. 610. Act of January 26, 1907, 34 Stat. 864.[http://www.polisci.ccsu.edu/trieb/turn.htm “Turn of the Twentieth Century Timeline,”] {{Webarchive|url=https://web.archive.org/web/20131005155701/http://www.polisci.ccsu.edu/trieb/turn.htm |date=October 5, 2013 }} Central Connecticut State University, accessed 4/5/14.[http://www.fec.gov/info/appfour.htm “Appendix 4: The Federal Election Campaign Laws: A Short History”] {{webarchive|url=https://web.archive.org/web/20050730082922/http://www.fec.gov/info/appfour.htm |date=2005-07-30 }}, Federal Election Commission. Accessed 4/5/14. Forty years later, the Taft-Hartley Act banned direct election contributions by labor unions and corporations to federal elections.Kirk Nahra, [http://ir.lawnet.fordham.edu/cgi/viewcontent.cgi?article=2760&context=flr “Political Parties and the Campaign Finance Laws: Dilemmas, Concerns, and Opportunities,”] Fordham Law Review, vol. 56, issue 1 (1987).

In 1971, the Federal Election Campaign Act (FECA) initiated sweeping reforms by requiring full reporting of contributions to federal elections.[http://www.fec.gov/pages/brochures/fecfeca.shtml#Historical_Background “The FEC and the Federal Campaign Finance Law,”] Federal Election Commission. February 2004.[https://www.congress.gov/cgi-bin/cpquery/?&dbname=cp106&&r_n=hr756.106&sel=TOC_315131& Federal Election Campaign Act of 1971. 2 U.S.C § 431.] In 1974, amendments to the FECA created the Federal Election Commission and enacted stricter limits on election contributions and expenditures.

That same year, Buckley v. Valeo challenged the 1974 FECA amendments in the U.S. Supreme Court on the grounds that they violated the First Amendment's guarantees of free speech.{{cite web|url=https://www.law.cornell.edu/constitution/first_amendment |title=First Amendment |publisher=Cornell University Law School Legal Information Institute |access-date=May 3, 2013 |archive-date=May 1, 2013 |archive-url=https://web.archive.org/web/20130501072645/http://www.law.cornell.edu/constitution/first_amendment |url-status=live }}[https://www.law.cornell.edu/supremecourt/text/424/1 Buckley v. Valeo]. 424 U.S. 1 (1976). The Court, introducing the concept of spending money as a form of unrestricted political speech, overturned limits on campaign expenditures.[http://www.fec.gov/law/litigation_CCA_B.shtml ”Litigation CCAB”] {{Webarchive|url=https://web.archive.org/web/20140212211653/http://www.fec.gov/law/litigation_CCA_B.shtml |date=2014-02-12 }}, Federal Election Commission. Accessed 4/5/14. However, it upheld contribution limits because such limits served the government's interest in reducing election corruption.

In 1976, Massachusetts passed Massachusetts General Laws ch. 55 § 8,[https://malegislature.gov/Laws/GeneralLaws/PartI/TitleVIII/Chapter55/Section8], Annotated Laws of Massachusetts GL ch. 55 § 8. which expanded the 1974 FECA amendment's prohibitions. The new criminal statute disallowed the use of "corporate funds to purchase advertising to influence the outcome of referendum elections, unless the corporation's business interests were directly involved."

That same year, Massachusetts proposed a constitutional amendment (to be voted upon in a referendum election) modifying income tax laws. The First National Bank of Boston, New England Merchants National Bank, the Gillette Co., Digital Equipment Corp., and Wyman-Gordon claimed that this amendment affected their business interests and that they should be allowed to spend corporate funds on relevant advertising.First Nat. Bank of Bos. v. Attorney Gen., 371 Mass. [https://law.justia.com/cases/massachusetts/supreme-court/volumes/371/371mass773.html 773], 359 N.E.2d 1262 (1977). The Massachusetts Attorney General's Office, applying Massachusetts General Laws. ch. 55 § 8, disagreed.

In response, the corporations sued Massachusetts Attorney General Francis Bellotti, the Coalition for Tax Reform, and United Peoples, Inc., contending that Massachusetts General Law ch. 55 § 8 was unconstitutional because it violated their right to free speech. The Supreme Judicial Court of Massachusetts heard The First National Bank of Boston & others v. Attorney General & others on June 8, 1976.

On February 1, 1977, the Massachusetts Supreme Court ruled in favor of the defendants, stating that Massachusetts General Laws ch. 55 § 8 was constitutionally applied because of a failure to find a material effect on the corporations' business interests. The plaintiffs appealed the decision to the United States Supreme Court.[http://supreme.justia.com/cases/federal/us/435/765/ "Syllabus, First Nat’l Bank of Boston v. Bellotti – 435 U.S. 765 (1978).”] Justia. Accessed 3/22/14.

The U.S. Supreme Court heard First National Bank of Boston et al. v. Bellotti, Attorney General of Massachusetts, on November 9, 1977.

Francis H. Fox presented the oral arguments on behalf the appellant, the First National Bank of Boston in representation of national banking associations and business corporations.Lexis Summary. 435 U.S. 765; 98 S. Ct. 1407; 55 L. Ed. 2d 707; 1978 U.S. LEXIS 83; 3 Media L. Rep. 2105. Date Accessed: 2014/03/23.[https://www.oyez.org/cases/1970-1979/1977/1977_76_1172#chicago "First National Bank of Boston v. Bellotti"] The Oyez Project at IIT Chicago-Kent College of Law, accessed April 5, 2014. E. Susan Garsh joined him on the briefs. Massachusetts Assistant Attorney General Thomas R. Kiley spoke during oral argument for the appellee. The Attorney General Francis X. Bellotti and Assistant Attorney General Stephen Schultz joined him on the brief. Main issues addressed during oral arguments included corporations as persons, the scope of freedom of speech, and the power of the states.

The Associated Industries of Massachusetts, Inc. and the U.S. Chamber of Commerce filed briefs of amici curiae supporting a reversal of the lower courts' ruling.Lexis Summary. 430 U.S. 964; 97 S. Ct. 1642; 52 L. Ed. 2d 354; 1977 U.S. LEXIS 1460. Date Accessed: 2014/03/23.Lexis Summary. 429 U.S. 876; 97 S. Ct. 199; 50 L. Ed. 2d 159; 1976 U.S. LEXIS 3046. Date Accessed: 2014/03/23. The Federal Election Commission filed briefs of amici curiae supporting an affirmation of the constitutionality of the statue. The State of Montana, the New England Council, and the Pacific Legal Foundation also filed amicus briefs.Lexis Summary. 431 U.S. 963; 97 S. Ct. 2918; 53 L. Ed. 2d 1058; 1977 U.S. LEXIS 2336. Date Accessed: 2014/03/23. The Northeastern Legal Foundation's motion to file a brief was denied.Lexis Summary. 432 U.S. 904; 97 S. Ct. 2947; 53 L. Ed. 2d 1076; 1977 U.S. LEXIS 2471. Date Accessed: 2014/03/23.

The Supreme Court issued its decision on April 26, 1978, with a 5-to-4 majority vote in favor of the First National Bank of Boston.Bellotti, 435 U.S. at 766. Justice Powell delivered the majority opinion and was joined by Justices Stewart, Blackmun, and Stevens, with Burger writing a separate concurring opinion. Justice White was joined by Justices Brennan and Marshall in his dissent, with Justice Rehnquist issuing a separate dissent.Bellotti, 435 U.S. at 767. The Supreme Court ruled that corporations have First Amendment speech protections extending beyond material commercial interests, reversing the decision made by the Massachusetts Supreme Court.59 S. Cal. L. Rev. 1227 (1985-1986). Free Speech and Corporate Freedom: A Comment on First National Bank of Boston v. Bellotti; Schneider, Carl E. Page 1227.

In opinion written by Justice Powell, the court held:

1. the case was not moot because it was one of a category of cases that is "capable of repetition, yet evading review;"
2. the statute was unconstitutional and the argument that a corporation's speech regarding issues not relevant to the business loses its First Amendment protection is invalid.

In its ruling, the Court first considered whether the case was moot.Bellotti, 435 U.S. at 774. The constitutional amendment that the appellants had opposed had been defeated by the time the case came to the Court's attention. The Court used the scrutiny described in Weinstein v. Bradford in its determination that the case was not, in fact, moot.{{ussc|name=Weinstein v. Bradford|volume=423|page=147|pin=149|year=1975}}.[http://scholarlycommons.law.northwestern.edu/cgi/viewcontent.cgi?article=6094&context=jclc "First Amendment--Corporate Free Speech"], Journal of Criminal Law & Criminology 69 (1978): 545, accessed April 20, 2014. The Court's rationale was twofold: first, the interval between the amendment's proposal and its referendum was too short for complete judicial review to have occurred; and second, the Court found that there was a reasonable expectation that the appellants would be adversely affected by the statute again.Bellotti, 435 U.S. at 774-775.

Then, the Supreme Court held that the Massachusetts statute in question violated corporate speech rights protected under the First Amendment.Bellotti, 435 U.S. at 786-787. The majority wrote that "commercial speech is accorded some constitutional protection not so much because it pertains to the seller's business as because it furthers the societal interest in the 'free flow of commercial information.'"

The majority opinion asserted that "the inherent worth of the speech in terms of its capacity for informing the public does not depend upon the identity of its source, whether corporation, association, union, or individual." In deciding the case, the Court rejected the argument that the Fourteenth Amendment did not apply to corporations.Bellotti, 435 U.S. at 784. The Court overruled Pierce v. Society of Sisters, which stated that corporations "cannot claim for themselves the liberty which the Fourteenth Amendment guarantees," declaring the decision to be "untenable under decisions of this Court".{{ussc|name=Pierce v. Society of Sisters|volume=268|page=510|pin=|year=1925}}. Instead, the Court asserted that the Due Process Clause extends freedom of speech and other First Amendment liberties to corporate entities.1979 Utah L. Rev. 98 (1979) Prohibition of Corporate Political Expenditures: The Effects of First National Bank v. Bellotti; Green, Thomas B. Page 98.

The majority rejected the argument that the First Amendment rights of a corporation derive purely from their business and property interests.67 Geo. L. J. 1347 (1978-1979). O'Kelley, Charles R. Jr. Constitutional Rights of Corporations Revisited: Social and Political Expression and the Corporation after First National Bank v. Bellotti, The. Pages 1370-1371. Furthermore, the Court asserted that "the Court's decisions involving corporations in the business of communication or entertainment are based not only on the role of the First Amendment in fostering individual self-expression, but also on its role in affording the public access to discussion, debate, and the dissemination of information and ideas".Bellotti, 435 U.S. at 783. The Supreme Court cited Virginia State Board of Pharmacy v. Virginia Citizens Consumer Council, in which the Court held that whether "the advertiser's interest in a commercial advertisement is purely economic does not disqualify him from protection under the First and Fourteenth Amendments. Both the individual consumer and society in general may have strong interests in the free flow of commercial information."{{ussc|name=Va. Pharmacy Board v. Va. Consumer Council|volume=425|page=748|pin=|year=1976}}. The Court found that there was no evidence that corporations lost speech protections if their speech did not materially affect the business of the corporation.59 S. Cal. L. Rev. 1227 (1985-1986), at 1229. Thus, the Court held the statute violated the First Amendment rights of the corporation.

The Court also rejected the claim that the statute was "necessitated by governmental interests of the highest order".Bellotti, 435 U.S. at 785. Massachusetts had argued that the statute was necessary for two reasons: first, that the State had a compelling interest in maintaining the role of the individual in the electoral process and that corporate speech would diminish this; and secondly, to protect shareholders of the corporations whose views might differ from those of the corporate management.29 Case W. Res. L. Rev. 813 (1978-1979) Corporate Spending on State and Local Referendums: First National Bank of Boston v. Bellotti; Hart, Gary; Shore, William. Page 813. The majority asserted that neither of these justifications was apparent in the statute.Bellotti, 435 U.S. at 788. Furthermore, the decision found that there was insufficient evidence that the law was necessary to satisfy the compelling state interest test.59 S. Cal. L. Rev. 1227 (1985-1986), at 1229 As to the latter claim, the Court held that the statute was both underinclusive and overinclusive in regards to shareholders interests.67 Geo. L. J. 1347 (1978-1979), at 1371

Chief Justice Burger, wrote a separate concurring opinion in order "to raise some questions likely to arise in this area in the future."Bellotti, 435 U.S. at 795 (Burger, C.J., concurring).

Burger wrote to emphasize the difficulty in differentiating media corporations from other corporate entities.Bellotti, 435 U.S. at 796. He also pointed out that media conglomerates were a more likely threat than the appellants to the public interests raised by the state of Massachusetts, due to their immense influence.Bellotti, 435 U.S. at 796-797. Thus, Burger concluded that "no factual distinction has been identified as yet that would justify government restraints on the right of appellants to express their views without, at the same time, opening the door to similar restraints on media conglomerates with their vastly greater influence".Bellotti, 435 U.S. at 797. Burger pointed out that as newspapers merged with global media conglomerates, separating corporations from media had become untenable. Therefore, Burger argued, restrictions on speech such as the Massachusetts statute necessitated a great deal of caution.Bellotti, 435 U.S. at 802. "In short," Burger wrote, "the First Amendment does not 'belong' to any definable category of persons or entities: it belongs to all who exercise its freedoms."

A dissenting opinion by Justice White was joined by Justices Brennan and Marshall. In the dissent, White disagreed with the Court's opinion that the statute abridges the speech rights of corporations.67 Ky. L.J. 75 (1978-1979) Corporate Political Speech: The Effect of First National Bank of Boston v. Bellotti upon Statutory Limitations on Corporate Referendum Spending; Fox, Francis H. Page 83. "By holding that Massachusetts may not prohibit corporate expenditures or contributions made in connection with referendums involving issues having no material connection with the corporate business," White wrote, "the Court not only invalidates a statute which has been on the books in one form or another for many years, but also casts considerable doubt upon the constitutionality of legislation passed by some 31 States restricting corporate political activity."Bellotti, 435 U.S. at 803 (White, J., dissenting).

White wrote that the Court had erred in not recognizing that the "state's regulatory interests ... were themselves derived from the First Amendment." Specifically, White claimed that "the state had a first amendment interest in 'assuring that shareholders are not compelled to support and financially further beliefs with which they disagree.'"59 S. Cal. L. Rev. 1227 (1985-1986), at 1231 The only purpose uniting all shareholders, White argued, is to make a profit.Bellotti, 435 U.S. at 805. Any issue not related to business interests could diverge from the interests of individual shareholders.

White also argued that states have the ability to prevent threats from corporate entities to the political process.Bellotti, 435 U. S. at 809. "The State need not permit its own creation to consume it," White wrote. White noted that the nation had a history of recognizing the need to limit the influence of corporations in the political process, citing United States v. Auto Workers, in which the Court held that the primary purpose of a federal act was "to avoid the deleterious influences on federal elections resulting from the use of money by those who exercise control over large aggregations of capital."{{ussc|name=United States v. Auto Workers|volume=352|page=567|pin=585|year=1957}}.

Justice Rehnquist, in a separate dissent, sharply criticized the Court's decision.13 J. Contemp. L. 221 (1987) Populist of the Adversary Society: The Jurisprudence of Justice Rehnquist, The; Maveety, Nancy. Page 237. Rehnquist pointed out that, while the issue of whether corporations had the right to voice their opinions on political issues was new to the Court, the constitutional permissibility of restrictions on such speech had been considered and approved by Congress and over thirty states.Bellotti, 435 U.S. at 823. He argued that this consensus by so many governmental institutionals should not be ignored in the Court's decision.

Furthermore, Rehnquist claimed that corporate speech is only protected such as it connects to commercial interests.22 Ariz. L. Rev. 427 (1980) PACing the Burger Court: The Corporate Right to Speak and the Public Right to Hear after First National Bank v. Bellotti; Kiley, Thomas R. Page 436. Rehnquist concluded, "although the Court has never explicitly recognized a corporation's right of commercial speech, such a right might be considered necessarily incidental to the business of a commercial corporation. It cannot be so readily concluded that the right of political expression is equally necessary to carry out the functions of a corporation organized for commercial purposes."Bellotti, 435 U.S. at 825.

Rehnquist asserted that corporate liberties did not include the right to influence and engage in political issues:

I can see no basis for concluding that the liberty of a corporation to engage in political activity with regard to matters having no material effect on its business is necessarily incidental to the purposes for which the Commonwealth permitted these corporations to be organized or admitted within its boundaries. Nor can I disagree with the Supreme Judicial Court's factual finding that no such effect has been shown by these appellants. Because the statute as construed provides at least as much protection as the Fourteenth Amendment requires, I believe it is constitutionally valid.Bellotti, 435 U.S. at 828.

From this conclusion, Rehnquist argued that the dissemination of information to the public is not diminished by restrictions on corporate speech on political topics. Therefore, in his view, "all natural persons ... remain as free as before to engage in political activity."

In 1990, the Supreme Court in Austin v. Michigan Chamber of Commerce upheld a state law prohibiting corporate independent expenditures, reasoning that the "government has a strong interest in preventing the wealth of corporations from distorting elections for public office."Mayer, L. "Breaching a Leaking Dam?: Corporate Money and Elections." Charleston School of Law. 2009. LexisNexis 105. Date Accessed: 2014/04/17. The 2003, Supreme Court majority in McConnell v. Federal Election Commission "relied on Austin" to preserve new federal campaign restrictions of the Bipartisan Campaign Reform Act (2002).Miller, P. "Shareholder Rights: Citizens United and Delaware Corporate Governance Law." Journal of Law & Politics, Inc. 2012. LexisNexis 56. Date Accessed: 2014/04/17. In 2010, the Supreme Court in Citizens United v. Federal Election Commission overturned Austin and returned to the principle established in Buckley and Bellotti that "the First Amendment does not allow political speech restrictions based on a speaker's corporate identity."{{ussc|name=Citizens United v. Federal Election Comm'n|link=Citizens United v. FEC|volume=558|page=310|pin=315|year=2010}}.

In 1990, the Supreme Court ruled in Austin v. Michigan Chamber of Commerce that even though the First Amendment did protect corporate expression, restrictions on independent expenditure were justified due to the compelling interest to prevent corruption or the appearance of corruption in campaigns.Geary, Sean T. "Austin v. Michigan Chamber of Commerce: Freedom of Expression Issues Implicated by the Government Regulation of Corporate Political Expenditures in Candidate Elections. Law Review, Boston University. 1992. LexisNexis 828. Date Accessed: 2014/03/21{{ussc|name=Austin v. Michigan Chamber of Commerce|link=|volume=494|page=652|pin=658|year=1990}}. The Austin majority quoted Bellotti in agreeing that political speech did not lose First Amendment protection "merely because the speaker is a corporation."Charles D. Watts Jr., [http://heinonline.org/HOL/Page?handle=hein.journals/umialr46&g_sent=1&collection=journals369&id=369 “Corporate Legal Theory under the First Amendment: Bellotti and Austin”], University of Miami Law Review 46 (1991): 369, accessed April 20, 2014.Geary, Sean T. "Austin v. Michigan Chamber of Commerce: Freedom of Expression Issues Implicated by the Government Regulation of Corporate Political Expenditures in Candidate Elections. Law Review, Boston University. 1992. LexisNexis 831. Date Accessed: 2014/03/21Bellotti, 435 U.S. at 777. However, the Austin majority held that the Michigan Chamber of Commerce, a non-profit corporation that wanted to publish a newspaper advertisement supporting a candidate, did not qualify for the non-profit exemption established in Federal Election Commission v. Massachusetts Citizens for Life, Inc (1986).Geary, Sean T. "Austin v. Michigan Chamber of Commerce: Freedom of Expression Issues Implicated by the Government Regulation of Corporate Political Expenditures in Candidate Elections. Law Review, Boston University. 1992. LexisNexis 829. Date Accessed: 2014/03/21 The dissent in the Austin case cited the statement in Bellotti that "the legislature is constitutionally disqualified from dictating the subjects about which persons may speak and the speakers who may address a public issue."Austin, 494 U.S. at 698-699.Bellotti, 435 U.S. at 784-785.Gerald Ashdown, [http://heinonline.org/HOL/Page?handle=hein.journals/vanlr44&g_sent=1&collection=journals791&id=791 “Controlling Campaign Spending and the New Corruption: Waiting for the Court”], Vanderbilt Law Review 44 (1991): 777, accessed April 20, 2014. The dissent found that Massachusetts's law discriminated on the basis of the speaker's identity, and argued that the precedents of the Supreme Court, such as Bellotti, condemn this type of censorship.First National Bank v. Bellotti, 435 U.S. at 784-786. Scholars agree that the Austin decision was inconsistent with precedent in that the Court had previously never upheld a statue that regulated corporate independent expenditure because of a state interest in preventing corruption.Lassman, P. "Breaching the Fortress Walls: Corporate Political Speech and Austin v. Michigan Chamber of Commerce." Virginia Law Review. 1992. LexisNexis 782. Date Accessed: 2014/04/14.Shofield, M. "Muzzling Corporations: The Court Giveth and the Court Taketh Away a Corporation's "Fundamental Right" to Free Political Speech in Austin v. Michigan Chamber of Commerce." Louisiana Law Review. 1991. LexisNexis 260. Date Accessed: 2014/04/14.Cytryn, M. "Defining the Specter of Corruption: Austin v. Michigan Chamber of Commerce." Brooklyn Law Review. 1991. LexisNexis 940. Date Accessed: 2014/04/14.

In 2002, the Supreme Court in McConnell v. Federal Election Commission upheld the two major provisions of the Bipartisan Campaign Reform Act, which were the bans on unrestricted "soft money" donations to political parties and on electioneering communications, which are defined as any broadcast that refers to a federal candidate and is aired within a designated time frame of that candidate's election.[https://www.oyez.org/cases/2000-2009/2003/2003_02_1674 “McConnell v. Federal Election Commission.”] Date Accessed: 2014/03/21.Clark, Michael. "Unleashing Electioneering: Analyzing the Court's Decision in Federal Election Commission v. Wisconsin Right to Life, Inc. Law Journal, Southern Illinois University. Fall 2008. LexisNexis 126. Date Accessed: 2014/03/21. The McConnell majority moved away from the Bellotti decision by allowing such restrictions on corporate donations.Thomas McCoy, [http://heinonline.org/HOL/Page?men_tab=srchresults&handle=hein.journals/deplr54&size=2&collection=journals&set_as_cursor=1080&id=1080 “Understanding McConnell v. FEC and Its Implications for the Constitutional Protection of Corporate Speech”], DePaul Law Review 54 (2004): 1070, accessed April 20, 2014.{{ussc|name=McConnell v. Federal Election Comm'n|link=McConnell v. FEC|volume=540|page=93|pin=|year=2003}}. The majority accepted legislative judgment that corporate treasuries represent a threat of corruption when deployed directly in candidate elections."Kerr, R. "Subordinating the Economic to the Political: The Evolution of Corporate Speech Doctrine." Lawrence Erblaum Associates, Inc. 2005. Lexis Nexis 99. Date Accessed: 2014/04/06. The McConnell dissent characterized the Austin argument concerning the "corrosive and distorting effects" of corporations as the notion that corporations "will be able to convince voters on the correctness of their ideas."Austin, 494 U.S. at 659.McConnell, 540 U.S. at 273. The dissent argued that using this reasoning, simply "winning the marketplace of ideas" could be considered evidence of corruption. They argued that this conclusion opposed the First amendment, citing the statement from Bellotti that "the fact that advocacy may persuade the electorate is hardly a reason to suppress it."McConnell, 540 U.S. at 274.Bellotti, 435 U.S. at 790.

In 2010, the Supreme Court in Citizens United v. Federal Election Commission overturned Austin v. Michigan Chamber of Commerce (1990), portions of McConnell v. Federal Election Commission (2003), and Section 203 of the Bipartisan Campaign Reform Act (2002) that prohibited electioneering communications by corporations."The Supreme Court, 2009 Term: Comment: Citizens United v. FEC: Corporate Political Speech." 2010. LexisNexis 76. Date Accessed: 2014/04/06. The Harvard Journal of Law and Public Policy described the reasoning of the Citizens majority as based on two propositions. The first was that the Court has recognized that "First Amendment protections extend to corporations," for which the Court cited Bellotti as an example.Citizens United, 558 U.S. at 313.Bellotti, 435 U.S. at 778. The Court "returned to the principle established in Buckley and Bellotti that the Government may not suppress political speech based on the speaker's corporate identity." The Court cited Bellotti in arguing that political speech is "indispensable to decision making in a democracy and [that] this is no less true because the speech comes from a corporation." The second proposition addressed contribution expenditure and corruption.G. Breanne. "Removing Corporate Campaign Finance Restrictions v. Federal Election Commission." Harvard Society for Law and Public Policy, Inc. 2011. LexisNexis 409. Date Accessed: 2014/04/06. The Court ruled that independent expenditure limits were unconstitutional because, unlike campaign contribution limits, they fail to "serve any substantial government interest in stemming the reality or appearance of corruption in the electoral process."{{ussc|name=Buckley v. Valeo|volume=424|page=1|pin=47|year=1976}}. The Court argued, "Austin upheld a corporate independent expenditure restriction" by recognizing a "new governmental interest" in preventing corruption to "bypass Buckley and Bellotti." The Court rejected the anti-distortion reasoning argued in Austin and returned to the quid pro quo conception of corruption used in Buckley, stating that "independent expenditures, including those made by corporations, do not give rise to corruption or the appearance of corruption."G. Breanne. "Removing Corporate Campaign Finance Restrictions v. Federal Election Commission." Harvard Society for Law and Public Policy, Inc. 2011. LexisNexis 418. Date Accessed: 2014/04/06.Citizens United, 558 U.S. at 314. In overruling Austin, the Citizens majority insisted, "before Austin, the court had not allowed the exclusion of a class of speakers from general public dialogue."Kerr, R. "What Justice Powell and Adam Smith could have told the Citizens United Majority about Other People's Money." North Carolina Law Review Association. 2011. LexisNexis 226. Date Accessed: 2014/04/14.Citizens United, 558 U.S. at 341. The Court did concede that the Bellotti case "did not address the constitutionality" of bans on "corporate independent expenditures to support candidates." However, the court reasoned that such bans "would have been unconstitutional under Bellotti's central principle that the First Amendment does not allow political speech restrictions based on a speaker's corporate identity."

While the First National Bank of Boston v. Bellotti ruling set a precedent for allowing corporate spending in elections, it did not directly lead to federal campaign law changes because of its narrow focus.John Nichols and Robert W. McChesney, Dollarocracy (New York: Nation Books, 2013), 86.Robert L Kerr, [http://www.lexisnexis.com/lnacui2api/api/version1/getDocCui?lni=4FFM-X7P0-00KD-H05K&csi=222003&hl=t&hv=t&hnsd=f&hns=t&hgn=t&oc=00240&perma=true "Subordinating the Economic to the Political: The Evolution of the Corporate Speech Doctrine,"] Communication Law & Policy 10 (2005): 63, accessed March 19, 2014. The Bellotti decision focused on state referendums, not the election of candidates.

In April 1978, when the Supreme Court decided First National Bank of Boston v. Bellotti, 31 states had laws regulating corporate spending on ballot initiatives.Robert L Kerr, [http://www.lexisnexis.com/lnacui2api/api/version1/getDocCui?lni=4FFM-X7P0-00KD-H05K&csi=222003&hl=t&hv=t&hnsd=f&hns=t&hgn=t&oc=00240&perma=true "Subordinating the Economic to the Political: The Evolution of the Corporate Speech Doctrine,"] Communication Law & Policy 10 (2005): 71, accessed March 19, 2014.Library of Congress, [https://archive.today/20140407005222/http://babel.hathitrust.org/cgi/pt?id=umn.31951d00818805j;view=1up;seq=9 Analysis of Federal and state campaign finance law, summaries] (Washington DC: Library of Congress, 1977).Allen K. Easley, [http://heinonline.org/HOL/Page?handle=hein.journals/geolr17&div=27&g_sent=1&collection=journals#691 "Buying Back the First Amendment: Regulation of Disproportionate Corporate Spending in Ballot Issue Campaigns"] Georgia Law Review 17 (1983): 681. However, not all of these state laws were annulled by the Supreme Court ruling. Universal caps on donations for ballot initiatives as well as specific bans aimed to prevent "undue" corporate influence on referendums were still considered constitutional.P Lansing and G.M. Sherman, [http://heinonline.org/HOL/Page?handle=hein.journals/jcorl8&collection=journals&set_as_cursor=8&men_tab=srchresults&type=matchall107&id=107 “Evolution of the Supreme Court's Political Spending Doctrine: Restricting Corporate Contributions to Ballot Measure Campaigns after Citizens against Rent Control v. City of Berkeley California,”] The Journal of Corporation Law 8 (1982): 96, accessed March 19, 2014. Of these 31 states, 18 of them, including Massachusetts, had laws that would be considered unconstitutional after the Bellotti decision.Warren Weaver Jr., [https://timesmachine.nytimes.com/timesmachine/1978/04/27/110845011.pdf “Justices, 5-4, Allow Corporate Spending for Issues on Ballot,”] The New York Times, April 27, 1978, accessed March 17, 2014.

In the aftermath of Bellotti, several states changed their laws relating to spending on referendums.P Lansing and G.M. Sherman, [http://heinonline.org/HOL/Page?handle=hein.journals/jcorl8&collection=journals&set_as_cursor=8&men_tab=srchresults&type=matchall107&id=107 “Evolution of the Supreme Court's Political Spending Doctrine: Restricting Corporate Contributions to Ballot Measure Campaigns after Citizens against Rent Control v. City of Berkeley California,”] {{webarchive|url=https://web.archive.org/web/20161223131452/http://heinonline.org/HOL/Page?handle=hein.journals%2Fjcorl8&collection=journals&set_as_cursor=8&men_tab=srchresults&type=matchall107&id=107 |date=2016-12-23 }} The Journal of Corporation Law 8 (1982): 97, accessed March 19, 2014. In 1981, Iowa's state legislature updated their campaign finance laws to state,

It is unlawful for any insurance company, savings and loan association, bank, and or corporation ... to contribute any money, property, labor, or thing of value, directly or indirectly, to any committee, or for the purpose of influencing the vote of any elector, except that such resources may be so expended in connection with a ballot issue, however all such expenditures are subject to the disclosure requirements of this chapter.[https://www.legis.iowa.gov/docs/linc/acts/69/1/pdf/chapter_0035.pdf Iowa Acts] {{webarchive|url=https://web.archive.org/web/20140422232257/https://www.legis.iowa.gov/docs/linc/acts/69/1/pdf/chapter_0035.pdf |date=2014-04-22 }}, Chapter 35, Section 14, Iowa Legislature (1981).

Montana had previously banned all corporate donations for or against ballot issues.§23-4744, Revised Code of Montana (1947). In October 1978, this law was overturned by the Court of Appeals for the Ninth Circuit citing First National Bank of Boston v. Bellotti.[http://heinonline.org/HOL/CaseSearch?collection=journals&cop=1&cid=491586&account=libraries.claremont.edu&action=search§ions=any&search_type=Citation&terms=583%20F.2d%20421 C&C Plywood Corporation v. Hanson], 583 F.2d 421 (9th Cir. 1978).

On December 23, 1986, the General Court of Massachusetts approved a series of changes to its campaign finance laws, and only then officially changed the law governing corporate spending on ballot initiatives.[http://archives.lib.state.ma.us/actsResolves/1986/1986acts0631.pdf An Act Further Regulating Political Campaign Financing], Chapter 631, Section 5, General Court of Massachusetts (December 23, 1986), The State Library of Massachusetts DSpace. In "An Act Further Regulating Political Campaign Financing," the General Court stated that they were "striking out" Chapter 55, Section 8, the law annulled by the Bellotti decision. Furthermore, a new §8 law was written that in part stated,

No person or persons, no political committee, and no person acting under the authority of a political committee, or in its behalf, other than a political committee organized on behalf of a ballot question campaign ... shall solicit or receive from such corporation or such holders of stock any gift, payment, expenditure, contribution or promise to give, pay, expend or contribute for any such purpose.

Scholars are split on whether the First National Bank of Boston v. Bellotti decision has had an overall effect on the ballot initiative process. Some scholars believe that without any regulations on corporate spending on ballot initiatives, corporations have the potential to donate much more to these campaigns than individuals or citizen groups.Anthony Gierzynski, Money Rules (Oxford: Westview Press, 2000), 85.David R. Lagasse, [http://heinonline.org/HOL/Page?handle=hein.journals/brklr61&div=43&g_sent=1&collection=journals#1359 “Undue Influence: Corporate Political Speech, Power and the Initiative Process,”] Brooklyn Law Review 61 (1995):1349, accessed April 4, 2014.Reid Wilson, [https://www.washingtonpost.com/blogs/govbeat/wp/2013/11/08/initiative-spending-booms-past-1-billion-as-corporations-sponsor-their-own-proposals/ “Initiative Spending Booms Past $1 Billion as Corporations Sponsor Their Own Proposals,”] The Washington Post, November 8, 2013, accessed March 18, 2014. Some scholars maintain that this advantage gives corporations undue influence over referendum campaigns and policy outcomes.Thomas Stratmann, [http://www.gmu.edu/centers/publicchoice/faculty%20pages/stratmann/vitae%20files/effectmoney.pdf The Effectiveness of Money in Ballot Measure Campaigns,”] Southern California Law Review 78 (2004): 104, accessed March 16, 2014.David S. Broder,Democracy derailed: initiative campaigns and the power of money (New York: Harcourt, 2000)Thomas E. Cronin, "'Direct Democracy: The Politics of Initiative, Referendum, and Recall' (Cambridge: Harvard University Press, 1999), 109.

One such way corporations can use money to sway voters is through advertising and spreading information about propositions.Daniel H. Lowenstein, [http://heinonline.org/HOL/Page?handle=hein.journals/uclalr29&collection=journals&page=505#576 “Campaign Spending and Ballot Propositions: Recent Experience, Public Choice Theory and the First Amendment,”] UCLA Law Review 29 (1982): 562, accessed April 4, 2014.David R. Lagasse, [http://heinonline.org/HOL/Page?handle=hein.journals/brklr61&div=43&g_sent=1&collection=journals#1359 “Undue Influence: Corporate Political Speech, Power and the Initiative Process,”] Brooklyn Law Review 61 (1995):1375, accessed April 4, 2014. For example, a California ballot initiative, Proposition 37 from 2012, attracted a disproportionately high level of spending from corporations. The proposition would mandate that all foods containing genetically modified organisms would have to be labeled as such. Corporations including Monsanto and DuPont spent $45 million against Prop 37 - five times more than the money spent by supporters of the proposition.Amy Westervelt, [https://www.forbes.com/sites/amywestervelt/2012/11/13/with-california-prop-defeated-gmo-labeling-proponents-look-to-farm-bill/ “With California Prop Defeated, GMO Labeling Proponents Look to Farm Bill,”] Forbes, November 13, 2012, accessed March 18, 2014.Suzanne Goldenberg, [https://www.theguardian.com/environment/2012/nov/05/prop-37-food-gm-bill “Prop 37: food companies spend $45m to defeat California GM label bill,”] The Guardian, November 5, 2012, accessed April 4, 2014. The proposition was defeated by a margin of 51% to 48%,[http://www.sos.ca.gov/elections/sov/2012-general/ssov/ballot-measures-summary-by-county.pdf Statewide Summary by County, Propositions 30-40] {{webarchive|url=https://web.archive.org/web/20140415051403/http://www.sos.ca.gov/elections/sov/2012-general/ssov/ballot-measures-summary-by-county.pdf |date=2014-04-15 }} California General Election Results, November 6, 2012, accessed April 4, 2014. a result that left many pro-Prop 37 groups blaming unfair financing as the reason for the defeat.[http://www.carighttoknow.org/electionstatement “Right to Know Election Statement,”] {{webarchive|url=http://webarchive.loc.gov/all/20121224074337/http%3A//www.carighttoknow.org/electionstatement |date=2012-12-24 }} Right to Know, 2013, accessed April 4, 2014.

Still, other political scientists disagree, believing that there is no definitive evidence that links corporation donations to referendum results.[http://www.iandrinstitute.org/Quick%20Fact%20-%20Money.htm “What Impact Does Money Have in the Initiative Process?,”] {{webarchive|url=https://web.archive.org/web/20140423023855/http://www.iandrinstitute.org/Quick%20Fact%20-%20Money.htm |date=2014-04-23 }} Initiative & Referendum Institute at the University of Southern California, 2013, accessed March 19, 2014.Bernard Grofman, [http://www.socsci.uci.edu/~bgrofman/B98-Contribution-and-spending-limits.pdf “Contribution and Spending Limits for Initiatives or Other Ballot Propositions,”] Southern California Law Review 78 (2005): 103, accessed March 16, 2014.Allen K. Easley, [http://heinonline.org/HOL/Page?handle=hein.journals/geolr17&div=27&g_sent=1&collection=journals#691 "Buying Back the First Amendment: Regulation of Disproportionate Corporate Spending in Ballot Issue Campaigns"] Georgia Law Review 17 (1983): 694.Thomas Stratmann, [http://www.gmu.edu/centers/publicchoice/faculty%20pages/stratmann/vitae%20files/effectmoney.pdf The Effectiveness of Money in Ballot Measure Campaigns,”] Southern California Law Review 78 (2004): 101-124, accessed March 16, 2014. For example, the campaign around California's Proposition 188, a ballot initiative aimed at lifting bans on smoking,[https://www.latimes.com/archives/la-xpm-1994-10-30-ss-57856-story.html “Decision '94 / Special Guide to California's Elections: Propositions: 188: Regulates Smoking Statewide: What It Is?,”] Los Angeles Times, October 20, 1994, accessed March 19, 2014. is another example of unequal spending between corporations and others. Businesses spent over $19,000,000 in favor of Prop 188, while non-businesses spent less than $2,000,000 in opposition.Dan Morain, [https://www.latimes.com/archives/la-xpm-1994-10-29-mn-56134-story.html “California Elections : The Propositions : Funds Fuel Prop. 187 Fight; Tobacco Gives Millions to Prop. 188,”] The Los Angeles Times, October 29, 1994, accessed April 5, 2014.Anthony Gierzynski, Money Rules (Oxford: Westview Press, 2000), 86. Nevertheless, in this case, voters ultimately voted against Proposition 188.Dan Morain and Virginia Ellis, [https://www.latimes.com/archives/la-xpm-1994-11-09-mn-60581-story.html "California Elections / Propositions: Voters Approve 'Three Strikes' Law, Reject Smoking Measure: Proposal for government-run health care system, gasoline tax to fund rail projects are also defeated,"] The Los Angeles Times, November 9, 1994, accessed April 5, 2014.

Similarly, the gambling industry in California has spent tens of millions of dollars since 1912 on referendums regarding gambling rules. However, only 25% of the referendums they have supported monetarily have passed.

First National Bank of Boston v. Bellotti (1978), referred to by Linda Greenhouse as "the most important Supreme Court case no one's ever heard of," did not elicit a very strong reaction from the media and the public.[https://www.theatlantic.com/magazine/archive/2013/05/the-big-question/309290/ “What's the Most Important Supreme Court Case No One's Ever Heard Of?”], The Atlantic, last modified April 24, 2013, accessed March 19, 2014, https://www.theatlantic.com/magazine/archive/2013/05/the-big-question/309290/.[http://heinonline.org/HOL/Page?handle=hein.journals/scal59&div=43&g_sent=1&collection=journals#1248 59 S. Cal. L. Rev. 1232 (1985-1986) Free Speech and Corporate Freedom: A Comment on First National Bank of Boston v. Bellotti]; Schneider, Carl E. Most of the discourse pertaining to the case relates to the decision's effects on the role of money in politics and corporate rights.

Those who support the Bellotti decision saw it as a culmination of constitutional thinking on the issue of corporate political speech.[http://heinonline.org/HOL/Page?handle=hein.journals/kentlj67&div=11&g_sent=1&collection=journals#87 67 Ky. L.J. 75 (1978-1979) Corporate Political Speech: The Effect of First National Bank of Boston v. Bellotti upon Statutory Limitations on Corporate Referendum Spending]; Fox, Francis H.[http://heinonline.org/HOL/Page?handle=hein.journals/tlj16&div=35&g_sent=1&collection=journals#610 16 Tulsa L.J. 600 (1980-1981) Consolidated Edison and Bellotti: First Amendment Protection of Corporate Political Speech]; Prentice, Robert A These scholars and lawyers praise the ruling for treating corporate speech as equal as individual speech and thus increasing the information provided to voters during elections.[http://heinonline.org/HOL/Page?handle=hein.journals/tlj16&div=35&g_sent=1&collection=journals#610 16 Tulsa L.J. 600 (1980-1981) Consolidated Edison and Bellotti: First Amendment Protection of Corporate Political Speech; Prentice, Robert A]

According supporters, there is a long history of legislative and judicial decisions that justifies the Bellotti decision. While pre-1900 Supreme Courts believed that corporations did not deserve any protection under the First Amendment, by 1970 some lower courts were beginning to recognize First Amendment protection to "corporate speech." Lawyer Robert Prentice stated that First Amendment protection for corporations has worked its way into the decisions of the Supreme Court since the 1940s, in cases such as Valentine v. Chrestensen (1942), Pittsburgh Press Co. v. Pittsburgh Commission on Human Relations (1973) and Virginia State Pharmacy Board v. Virginia Citizens Consumer Council (1976). From 1973 to Chief Justice Burger's departure in 1986, "the Burger Court ... invalidated every commercial speech ban considered," building up precedents for the Bellotti decision.

Supporters also praise the increase in discourse and available surrounding information about ballot initiatives resulting from the Bellotti decision.[http://heinonline.org/HOL/Page?handle=hein.journals/kentlj67&div=11&g_sent=1&collection=journals#87 67 Ky. L.J. 75 (1978-1979) Corporate Political Speech: The Effect of First National Bank of Boston v. Bellotti upon Statutory Limitations on Corporate Referendum Spending; Fox, Francis H.][http://heinonline.org/HOL/Page?handle=hein.journals/geolr17&div=27&g_sent=1&collection=journals#687, 17 Ga. L. Rev. 677 (1982-1983) Buying Back the First Amendment: Regulation of Disproportionate Corporate Spending in Ballot Issue Campaigns; Easley, Allen K.] Lawyer Francis H. Fox wrote, "[the ruling] perceives that the First Amendment's purposes are better served by allowing the [free] use of means of communication than by enacting legislation designed to foster equality of access to those means." Prentice also noted that the Court acted correctly by protecting the rights of listeners to hear all possible pertinent information. This is the "right to receive" doctrine, which interprets the First Amendment as protecting individuals' right to receive information as part of freedom of communication.16 Tulsa L.J. 600 (1980-1981) [http://heinonline.org/HOL/Page?handle=hein.journals/tlj16&div=35&g_sent=1&collection=journals#610 Consolidated Edison and Bellotti: First Amendment Protection of Corporate Political Speech]; Prentice, Robert A

Critics condemned Bellotti for increasing the influx of corporate money into elections, claiming that this would drown out smaller voices and candidates.Tamara R. Piety, [http://www.michiganlawreview.org/assets/fi/109/piety.pdf Commentary, Citizens United and the Threat to the Regulatory State] {{webarchive|url=https://web.archive.org/web/20120130121802/http://www.michiganlawreview.org/assets/fi/109/piety.pdf |date=2012-01-30 }}, 109 Mich. L. Rev. First Impressions 16 (2010).George W Scofield [http://digitalcommons.law.lsu.edu/cgi/viewcontent.cgi?article=4446&context=lalrev “Bellotti - Corporations' Freedom of Speech”] Louisiana Law Review 79 (1979); 1232, accessed March 19, 2014.Greenhouse, Linda, [http://opinionator.blogs.nytimes.com/2011/08/24/over-the-cliff/?_php=true&_type=blogs&_r=0 “Over the Cliff”] The New York Times, August 24, 2011, accessed March 19, 2014. Academic George W. Scofield said that corporate speech unrelated to corporate property "becomes the purely personal views of corporate management [and is] undeserving of the constitutional protection afforded by Bellotti."George W Scofield [http://digitalcommons.law.lsu.edu/cgi/viewcontent.cgi?article=4446&context=lalrev “Bellotti - Corporations' Freedom of Speech”] Louisiana Law Review 79 (1979); 1236, accessed March 19, 2014.

Former Judge for the United States Court of Appeals for the District of Columbia Circuit J. Skelly Wright said that the rulings in both the First National Bank of Boston v. Bellotti and Buckley v. Valeo cases have "given protection to the polluting effect of money in financial campaigns."Wright, J. Skelly. [https://www.jstor.org/stable/1122194 "Money and the Pollution of Politics: Is the First Amendment an Obstacle to Political Equality?."] Columbia Law Review (1982): 609-645. Wright advocates for "one person, one vote," a concept that meshes with Scofield's concept of aligning the speech of a corporation and of the individuals composing it.George W Scofield [http://digitalcommons.law.lsu.edu/cgi/viewcontent.cgi?article=4446&context=lalrev “Bellotti - Corporations' Freedom of Speech”] Louisiana Law Review 79 (1979); 1238, accessed March 19, 2014.

Some critics point out that commercial interests and public interests are not always aligned, and that investment from corporations for commercial interests can be detrimental to the formation of public opinion.Tamara R. Piety, Commentary, {{cite web |url=http://www.michiganlawreview.org/assets/fi/109/piety.pdf |title=Archived copy |access-date=2014-04-21 |url-status=dead |archive-url=https://web.archive.org/web/20120130121802/http://www.michiganlawreview.org/assets/fi/109/piety.pdf |archive-date=2012-01-30 }} Citizens United and the Threat to the Regulatory State, 109 Mich. L. Rev. First Impressions 16 (2010) In an article in The New York Times, Linda Greenhouse said, "the court's speech-protective instincts appear increasingly to serve a deregulatory agenda."

Additionally, scholar Carl E. Schneider wrote in the Southern California Law Review that the Court's opinion agreed with previous opinions on the topic of "legislature attempting to govern the political and social power of the business corporation."[http://heinonline.org/HOL/Page?handle=hein.journals/scal59&div=43&g_sent=1&collection=journals#1248 59 S. Cal. L. Rev. 1232 (1985-1986) Free Speech and Corporate Freedom: A Comment on First National Bank of Boston v. Bellotti; Schneider, Carl E.] Schneider writes that the Court misinterpreted the First Amendment and had "problems in understanding social reality."

{{reflist}}

• {{caselaw source

| case = First National Bank of Boston v. Bellotti, {{ussc|435|765|1978|el=no}}

| courtlistener =https://www.courtlistener.com/opinion/109836/first-nat-bank-of-boston-v-bellotti/

| findlaw = https://caselaw.findlaw.com/us-supreme-court/435/765.html

| googlescholar = https://scholar.google.com/scholar_case?case=3768819597963662504

| justia =https://supreme.justia.com/cases/federal/us/435/765/

| loc =http://cdn.loc.gov/service/ll/usrep/usrep435/usrep435765/usrep435765.pdf

| oyez =https://www.oyez.org/cases/1977/76-1172

}}

{{US1stAmendment Freedom of Speech Clause Supreme Court case law|state=collapsed}}

{{DEFAULTSORT:First National Bank Of Boston V. Bellotti}}

Category:United States Supreme Court cases

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Category:United States Free Speech Clause case law

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