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Court Hears Pre-term Case on Clinton Film

WASHINGTON - The Supreme Court returns to the bench Wednesday for a second round of arguments in a campaign-finance case that could reshape the rules for corporate money in politics.

The court's decision could generate a greater flow of cash from wealthy interests just ahead of the 2010 elections. The case, which tests regulation of corporate and labor union spending on candidates, comes at a time of increased public scrutiny of corporations and as the high court has signaled that it might lift restrictions on corporate spending because of First Amendment concerns. The court has long considered campaign money as a form of political free speech.

At the center of the dispute is a conservative group's 2008 movie attacking then-presidential candidate Hillary Rodham Clinton. Citizens United's Hillary: The Movie featured news footage and harsh commentary by critics such as Newt Gingrich and Ann Coulter to portray the former first lady, then a New York U.S. senator, as ruthless. The question before the Supreme Court when it first took up the case last spring was whether a 2002 law prohibiting the airing of election ads by corporations close to an election applied to a feature-length movie.

The court raised the stakes when it announced in June that it would use the case to decide the more consequential question of whether to strike down past decisions that generally permit regulation of corporate spending in elections. The justices scheduled a rare September argument session, a month before the start of the term in early October. It will be the first case for Justice Sonia Sotomayor.

The risk of corruption

U.S. Solicitor General Elena Kagan says reversing course and loosening restrictions on corporate money in politics would undermine the validity of federal and state laws dating back decades and "make vast sums of corporate money available for overt electioneering." Kagan, who will argue her first case before the court, insists in her filing that corporations are more likely than individuals to pose "a risk of actual or apparent corruption."

Washington lawyer Theodore Olson, who as a former solicitor general under George W. Bush defended campaign-finance regulations, represents Citizens United, which made the movie partly with its corporate funds. He says the government is wrongly demonizing corporations and their political interests. He says the provocative Hillary: The Movie is precisely the type of message the First Amendment is supposed to protect.

Beyond the possible effects on upcoming elections, Citizens United v. Federal Election Commission will test a Supreme Court that has been shifting on its views of campaign-finance rules. Since Chief Justice John Roberts and Justice Samuel Alito joined the court in 2005 and 2006, a majority has been less inclined to uphold government campaign-finance rules.

Hillary: The Movie was shown in theaters and offered in DVD sales. The legal case developed during the presidential campaign when Citizens United sought to offer Hillary: The Movie through a TV video-on-demand service, and the Federal Election Commission said it was subject to campaign-finance law. That 2002 law - often known by the names of its lead Senate sponsors, Arizona Republican John McCain and Wisconsin Democrat Russ Feingold - in part prohibits TV or radio ads financed with corporate or labor union money that refer to a candidate 30 days before a primary or 60 days before a general election.

When a special three-judge federal court in Washington reviewed the film, the judges rejected Citizens United's arguments that it was a documentary and said it was a campaign ad with the message that people should vote against Clinton. The lower court upheld the campaign restriction.

Exploring the limits

After hearing Citizens United's appeal, the Supreme Court delivered not a decision but an order expanding the reach of the case. The court said it would consider whether to throw out 1990 and 2003 rulings that upheld state and federal limits on corporate expenditures.

In the 1990 case, Austin v. Michigan Chamber of Commerce, the court said, "Corporate wealth can unfairly influence elections."

McCain and Feingold say in a "friend of the court" brief that overruling the earlier decisions "would severely jolt our political system." They say the 1990 case "was rightly concerned with the corruption of the system that will result if campaign discourse becomes dominated not by individual citizens . . . but by corporate and union war chests."

Among those backing Citizens United are the AFL-CIO and Senate Minority Leader Mitch McConnell, R-Ky. McConnell has long opposed the McCain-Feingold law and made a broad challenge to it, which the Supreme Court rejected in 2003.

Professor Richard Hasen, an expert on campaign-finance law at Loyola Law School-Los Angeles, says the court may be ready to usher in an era of deregulation. "A Supreme Court that's willing to overturn (the 1990 case) is probably going to be willing to say (other) regulation should fall," he said. "The floodgates could open."

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