The Akron Legal News

Login | March 28, 2024

Book examines how We the People became We the Corporation

DANIEL A. COTTER
Law Bulletin columnist

Published: April 23, 2018

The U.S. Constitution does not use the word “corporation.” Nothing in our governmental framework “explicitly recognizes corporations or grants them individual rights.” However, culminating with the Citizens United and Hobby Lobby cases, the U.S. Supreme Court has expanded the rights of corporations as people under various protections of the Constitution.

In a recent Cotter’s Corner column, we reviewed two books of interest to the legal community and promised that a third, “We The Corporations,” would be addressed. This column focuses on that book.

The corporation as a person with constitutional rights

Adam Winkler is a UCLA law professor and a writer whose works have appeared in major newspapers and periodicals. (Recently, he responded to an early morning tweet that identified Justice Benjamin N. Cardozo by the wrong first name as “fake news.”). In “We The Corporations: How American Businesses Won Their Civil Rights,” Winkler has achieved an exhaustively researched, engaging and entertaining work that may well be the definitive history on the subject — and there is nothing fake about that assessment.

Winkler traces what he describes as the “corporate rights movement,” which were “won in courts of law, by judicial rulings extending fundamental protections to business.” Unlike other civil rights initiatives, which were visible to the public and moved incrementally in the direction of national consensus, Winkler posits that the corporate rights movement was more hidden from view “at least until Citizens United.”

Beginning with a bank case in 1809, Winkler covers the movement from its beginnings until its 2009 decision in Citizens United. But Winkler’s work is no dry recitation of facts from case after case nor a technical law review piece. Instead, it is a telling of not only how we arrived at the present treatment of corporations but includes details about some of the Supreme Court advocates who have fashioned the constitutional rights of corporations, some of the justices who helped decide such cases and some of the corporate backings of such advocacy for corporate rights.

As the book jacket notes, the book includes a “colorful cast of characters” including Chief Justice Roger Taney, Daniel Webster, Roscoe Conklin and Louis Powell.

Winkler begins the book by describing the deception perpetrated on the Supreme Court by Conkling, a powerful former senator, who had been one of the drafters of the 14th Amendment.

According to Conkling, the drafting committee of the 14th Amendment has intended the word “person” to include businesses. While the case at hand was not ruled upon due to a “procedural snafu,” Winkler notes that between the year of ratification of the 14th Amendment, 1868, and when a scholar in 1912 researched cases that assessed the 14th, only 28 dealt with African-Americans and 312 addressed corporate rights.

Winkler next tackles the history of the corporate entity, tracing back to the Societas Piblocoranum, which the Romans created in 300 B.C. In the United States, Jamestown and the Massachusetts Bay Co. were early instances of the corporate body.

The Bay Co. adopted a set of bylaws that included the “Body of Liberties,” which colonial officials had to respect and obey. The body was a much more expansive precursor to the eventual Bill of Rights included in the Constitution. These rights were intended to be protections for individuals.

Winkler traces the origin of constitutional protections for corporations to the 1809 Supreme Court decision in Bank of the United States v. Deveaux, an effort “to limit the rights of corporations.” In Deveaux, the issue was a corporation’s right to access the federal court system. The Supreme Court agreed with the arguments of Horace Bunner, agreeing with his theory that for purposes of determine judicial standing, a corporation’s status could be pierced and the members making up the entity were to be considered. Chief Justice John Marshall delivered the opinion, which began the 200-year process that culminated in Citizens United and Hobby Lobby.

Daniel Webster, considered to be one of the greatest orators to ever appear before the Supreme Court, was a defender of the Constitution, but also could be referred to as the “Defender of the Corporation,” according to Winkler. Webster represented many of the biggest corporations of his day, including before the Supreme Court.

Webster argued two major cases regarding corporate rights, the first a victory before the Marshall Court and almost 20 years later, a loss before the Taney Court.

In Dartmouth College v. Woodward, the Supreme Court held that a corporation was a private entity and had rights just an individual does. In 1837 and 1839, Marshall having been replaced by Taney, Webster did not fare as well. Taney was a populist and corporate reformer whose view of corporate rights was much more restrictive than Marshall’s.

In Charles River Bridge Co. v. Warren Bridge Co., the court refused to read monopoly rights into corporate charters and in Bank of Augusta v. Earle, Taney rejected Webster’s argument that corporations enjoyed protection under the privileges and immunities provision of the coming clause of Article IV.

In a series of cases decided by the Supreme Court from 1861 to 1935, the court held that corporations held certain property rights, but not liberty rights. These developments included the Lochner decision and saw Marc Hanna, a political operative, actively soliciting corporate money for the presidential campaign of William McKinley.

One interesting fact in the development of corporate rights by the Supreme Court involved Justice Stephen Field, a corporatist who was close with Leland Stanford of the Southern Pacific Railroad.

In one decision, the Supreme Court decided in favor of Southern Pacific on narrow grounds. Field used the Supreme Court’s Reporter of Decisions to expand corporate rights, and in a subsequent case, Field used the syllabus and headnote to expand corporate rights. The court would rely on that expansion going forward.

In 1936, the Supreme Court began ruling that corporations had liberty rights in addition to the property rights, when it decided Grosjean v. American Press Co., involving a fight over Louisiana Gov. Huey Long’s imposing an advertising tax on smaller papers in the state who opposed him.

As Winkler notes, “For the first time in American history, the Supreme Court held that corporations have the right to freedom of speech and freedom of the press under the Constitution.”

From Grosjean to present, Winkler explores how the civil rights movement, including NAACP v. Alabama ex rel. Patterson, and cases won by “Nader’s Raiders,” advocating for consumer rights against big corporations, created law and views of the corporate entity that led to the Citizens United and Hobby Lobby cases.

Along the way, Winkler reflects on the impact of Louis Powell and the “Powell Memo,” which is the blueprint for modern corporate efforts, and describes the underlying tensions among advocates that took place in Citizens United.

In 1978, Powell wrote the opinion for the court in First National Bank of Boston v. Bellotti, holding that corporations have a free speech right to influence ballot measure campaigns.

The path to Citizens United became a short, albeit indirect one, overturning a decision the court issued only seven years prior.

In a dissent, one of his last, Justice John Paul Stevens issued a bitter dissent, asserting the justices had used a case to advance views not raised by the litigants before them and that the decision ignored the court’s prior decisions.

Conclusion

Winkler has produced an exceptional book telling the story of how corporations have obtained equal footing to we the people. It is an entertaining true story breathed to life by the extraordinary talents of Adam Winkler.

Daniel A. Cotter is a partner at Latimer LeVay Fyock LLC and an adjunct professor at The John Marshall Law School, where he teaches SCOTUS Judicial Biographies. The article contains his opinions and is not to be attributed to anyone else. He can be reached at dcotter@llflegal.com.


[Back]