Friday, September 25, 2009

Who gave birth to corporations as persons? Judges!

In case y'all missed it, last week Jess Bravin reported in the Wall Street Journal on Justice Sonia Sotomayor's maiden Supreme Court appearance, as the Court heard arguments in a campaign-finance case that a lot of people believe will be decided-- disastrously-- in favor of unlimited corporate political spending. Sotomayor, Bravin writes,

suggested the majority might have it all wrong -- and that instead the court should reconsider the 19th century rulings that first afforded corporations the same rights flesh-and-blood people have.

Judges "created corporations as persons, gave birth to corporations as persons," she said. "There could be an argument made that that was the court's error to start with...[imbuing] a creature of state law with human characteristics."

After a confirmation process that revealed little of her legal philosophy, the remark offered an early hint of the direction Justice Sotomayor might want to take the court.

As Bravin notes,

For centuries, corporations have been considered beings apart from their human owners, yet sharing with them some attributes, such as the right to make contracts and own property. Originally, corporations were a relatively rare form of organization. The government granted charters to corporations, delineating their specific functions. Their powers were presumed limited to those their charter spelled out.

"A corporation is an artificial being, invisible, intangible," Chief Justice John Marshall wrote in an 1819 case. "It possesses only those properties which the charter of its creation confers upon it."

But as the Industrial Revolution took hold, corporations proliferated and views of their functions began to evolve.

In an 1886 tax dispute between the Southern Pacific Railroad and the state of California, the court reporter quoted Chief Justice Morrison Waite telling attorneys to skip arguments over whether the 14th Amendment's equal-protection clause applied to corporations, because "we are all of opinion that it does."

That seemingly off-hand comment reflected an "impulse to shield business activity from certain government regulation," says David Millon, a law professor at Washington and Lee University.

Bravin concludes:

On today's court, the direction Justice Sotomayor suggested is unlikely to prevail. During arguments, the court's conservative justices seem to view corporate political spending as beneficial to the democratic process. "Corporations have lots of knowledge about environment, transportation issues, and you are silencing them during the election," Justice Anthony Kennedy said during arguments last week.

But Justice Sotomayor may have found a like mind in Justice Ruth Bader Ginsburg. "A corporation, after all, is not endowed by its creator with inalienable rights," Justice Ginsburg said, evoking the Declaration of Independence.

How far Justice Sotomayor pursues the theme could become clearer when the campaign-finance decision is delivered, probably by year's end.

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