Legal News

Coates, IV, John C., Corporate Speech and the First Amendment: History, Data, and Implications (February 27, 2015). Available at SSRN: http://ssrn.com/abstract=2566785 or http://dx.doi.org/10.2139/ssrn.2566785

This Article draws on empirical analysis of court decisions, history, and economic theory (a) to show that corporations have begun to displace individuals as the direct beneficiaries of the First Amendment, a shift from individual to business First Amendment cases is recent but accelerating, and (b) to outline an argument that such cases typically reflect a form of socially wasteful rent seeking – not only bad law and bad politics, but also increasingly bad for business and society. Basic facts about corporations in history are reviewed, regulation of commercial speech in U.S. history is summarized, and the emergence of the First Amendment in case law is retold, with an emphasis on the role of constitutional entrepreneur Justice Lewis Powell prompting the Supreme Court to invent corporate speech rights. The chronology shows that First Amendment doctrine long post-dated pervasive regulation of commercial speech, which long pre-dated the rise of the U.S. as the world’s leading economic power – a chronology with implications for originalists, and for policy analysis of the value of commercial speech rights. The Article then analyzes Supreme Court and Courts of Appeals decisions to quantify what others 1 have noted qualitatively: corporations have increasingly displaced individuals as direct beneficiaries of First Amendment rights, they have done so recently, but with growing speed since Virginia Pharmacy (1976), 2 Bellotti (1978),3 and Central Hudson (1980). 4 Nearly half of First Amendment legal challenges now benefit business corporations and trade groups, rather than other kinds of organizations or individuals. Such cases represent examples of a particular kind of corruption, defined here as a form of rent seeking: the use of legal tools by business managers in specific cases to entrench reregulation in their personal interests at the expense of shareholders, consumers, and employees, and in aggregate to degrade the rule of law by rendering law less predictable, general and clear. This corruption not only risks the loss of a republican form of government emphasized by most critics of Citizens United, but also risks economic harms – a package of risks one could call (with some but only some exaggeration) “the risk of Russia.”