Adam Winkler

McConnell v. FEC, Corporate Political Speech, and the Legacy of the Segregated Fund Cases

Since 1978, the Supreme Courts decision in First National Bank of Boston v. Bellotti has been the starting point for discussion of the constitutional rights of corporations to engage in political speech. Although Bellotti is treated as a cornerstone of corporate political speech doctrine, the Supreme Courts most recent campaign finance decision - McConnell v. Federal Election Commission - confirms the doctrines deeper roots: a trio of cases decided well before Bellotti, including United States v. CIO (1948) United States v. Autoworkers (1957), and Pipefitters v. United States (1972). In these three cases (the Segregated Fund Cases), the Court established a framework for how to treat corporate (and union) political speech that is both strikingly contradictory to Bellotti and far more influential to the shape of modern campaign finance law. In contrast to Bellotti, the Segregated Fund Cases treat the identity of the speaker as crucial. Corporations (and unions) do have free speech rights but they can be barred from using general treasury funds to finance political speech and forced to use separate segregated accounts to raise money from members. The basis for the distinction is that treasury funds reflect the economically-motivated decisions of investors or members who do not necessarily approve of the political expenditures, while segregated funds - such as a political action committee (PAC) - raise and spend money from knowing, voluntary political contributors. This article analyzes the influence of the Segregated Fund Cases on corporate political speech rights and shows how the principles established in those cases reverberate through campaign finance legislation and Supreme Court case law. Bellotti, meanwhile, has been consistenty read to be limited to its facts: a complete ban on corporate political speech for ballot measures, with no segregated fund option. with regard to speech about candidates for elective office - the focus of federal law for nearly a century - McConnell confirms that the Segregated Fund Cases, not Bellotti, provide the dominant architecture for the doctrine and have been quietly shaping the law of corporate political speech for over a half-century.