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The Surprising and Complicated History of the 'Corporations Are People' Doctrine The Surprising and Complicated History of the 'Corporations Are People...

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The Surprising and Complicated History of the 'Corporations Are People' Doctrine

Granting legal personhood to corporations isn’t a novel, conservative plot crafted by the Roberts Court. The idea stretches back to the Gilded Age—and owes more to a lowly court reporter than any Supreme Court justice.

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(Win McNamee/Getty Images)

It's become a familiar leitmotif.

By a razor-thin 5-4 majority cleaved across partisan lines, the Supreme Court releases an opinion that appears to favor the rights of corporations—and, typically, their mega-rich owners—over those of ordinary citizens.

 

Hysteria and hand-wringing among the Left promptly ensues. Rinse, argue, repeat.

Steered by Chief Justice John Roberts, the Court's conservative majority has for years been using the "corporations are people" line—which witnessed a renaissance in popular lexicon thanks to Mitt Romney—to justify a wide array of rulings that, liberals say, are increasingly disenfranchising everyday citizens.

Mitt Romney in 2011: 'Corporations Are People, My Friend'
The then-presidential candidate responds to a heckling crowd at the Iowa State Fair. 

 

But the concept of what lawyers call "corporate personhood" began long before the Roberts Court. The doctrine, in fact, is almost 200 years old in the U.S. and, if you believe its critics, the Roberts Court has grossly misinterpreted it.

As with most legal thinking, corporate personhood has evolved considerably over time. An 1819 decision, Trustees of Dartmouth College v. Woodward, first got the ball rolling by holding that corporations have the right to enter into contract agreements with the same protections as individual people.

But the Dartmouth case had more to do with corporate rights than personhood. It wasn't until 1886, in a little-known case, that the Supreme Court said corporations were granted some of the same protections under the 14th Amendment (which famously gave us the much-litigated due process clause) afforded to "all persons born or naturalized in the United States." The case was Santa Clara County v. Southern Pacific Railroad, which found railroad tycoons, who were at the zenith of their power during the Gilded Age, fitfully protesting taxes levied by California.

But the Supreme Court didn't actually say much of anything in Santa Clara that's remembered today. Instead, a court reporter by the name of Bancroft Davis—who previously served as president of a railroad company—wrote the following in a headnote summarizing the Court's opinion:

 

One of the points made and discussed at length in the brief of counsel for defendants in error was that "Corporations are persons within the meaning of the Fourteenth Amendment to the Constitution of the United States." Before argument Mr. Chief Justice Waite said: The court does not wish to hear argument on the question whether the provision in the Fourteenth Amendment to the Constitution, which forbids a State to deny to any person within its jurisdiction the equal protection of the laws, applies to these corporations. We are all of opinion that it does.

Davis's headnote is important for two reasons. First, it was not a transcript but an interpretation of how the Court felt (though Davis did later correspond with Waite to verify the accuracy of his summary, which some legal scholars argue was far less nuanced than the ruling itself). And secondly, in the decision, as David Korten notes in his book, The Post-Corporate World: Life After Capitalism, Waite created the concept of corporate personhood without argument or precedent.

Indeed, just two years later, Justice Stephen Johnson Field delivered an opinion stating, "Under the designation of 'person' there is no doubt that a private corporation is included."

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"Thus it was that a two-sentence assertion by a single judge elevated corporations to the status of persons under the law, prepared the way for the rise of global corporate rule, and thereby changed the course of history," Korten writes.

And as Thomas Storck noted in 2012, shortly after the Occupy Wall Street movement briefly pushed for a reexamination of corporate personhood, the Supreme Court stated some 20 years after Santa Clara that headnotes lacked any legal authority. But that clarification was after Santa Clara had been cited and "acquired the status of a precedent."

Neither of these cases is cited in the this week's majority opinion in Hobby Lobby, which weakened the Obamacare contraception mandate and marks the latest installment of the Roberts Court's treatment of corporations as people. For the first time, legal observers noted, businesses were deemed to possess religious freedom.

But liberal Justice Ruth Bader Ginsburg, in her 35-page dissent, argued that Roberts and his four conservative brothers are misremembering history and continuing a pattern of misapplying a precedent set by a court reporter that eventually became standard jurisprudence. Earlier Courts, Ginsburg argued, never intended for corporations to be seriously considered on equal measure against, well, real people.

"As Chief Justice John Marshall observed nearly two centuries ago, a corporation is 'an artificial being, invisible, intangible, and existing only in contemplation of law,' " Ginsburg writes, citing Dartmouth. "Corporations, Justice [John Paul] Stevens more recently reminded [in Citizens United], 'have no consciences, no beliefs, no feelings, no thoughts, no desires.' "

Ginsburg lacerated the majority for venturing "into a minefield" with its Hobby Lobby opinion. But it's a minefield that was set—perhaps unintentionally—a long time ago.

This article appears in the July 2, 2014 edition of NJ Daily.

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Health Care Edge is one of my top resources."

Meghan, Associate Specialist

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