By Robert Barnes
Washington Post Staff Writer
Saturday, September 5, 2009; A01
More than 100 years of restrictions on corporate support of political candidates will be at stake next week when the Supreme Court considers whether a quirky case about a film denouncing Hillary Rodham Clinton should lead to a rewrite of the way federal elections are financed.
In an unusual hearing in the midst of their summer recess, the justices will decide whether to move beyond the particulars of "Hillary: The Movie" to more profound questions about the First Amendment's guarantee of free speech and how that squares with political spending.
The justices will consider casting aside previous rulings that uphold laws restricting corporate support of political candidates.
The court ruled in 1990 that corporations, because of their "immense aggregations of wealth," possessed a unique ability to drown out the voices of individuals in the nation's political conversation. That precedent was reinforced in 2003 when the court upheld the federal campaign finance law that limits the electoral influence of corporations, unions and special interest groups.
Conservative justices have chafed at the restrictions, especially in the federal legislation commonly known as the McCain-Feingold Act. And they have been joined by like-minded colleagues in Chief Justice John G. Roberts Jr. and Justice Samuel A. Alito Jr.
That the court would overturn a decision made as recently as 2003 has advocates of campaign finance reform erupting about "judicial activism" and speaking in apocalyptic terms.
"It would unleash corporations to use their massive wealth to overwhelm the federal system, with disastrous consequences for the country," said Fred Wertheimer, a longtime campaign finance reformer who now leads Democracy 21, a watchdog group.
He imagines corporations demanding fealty from lawmakers on health-care reform or auto industry bailouts with the promise of millions of dollars for their campaigns -- or the threat of the same amount used to finance a challenger.
Others see the potential for partisan advantage.
"If Republicans were wondering how their 2012 presidential candidate is going to compete against President Obama's $600 million fundraising juggernaut, the Supreme Court seems poised to provide an answer: unlimited corporate spending supporting the Republican candidate, or attacking Obama," Richard L. Hasen, an election law expert at Loyola Law School in Los Angeles, wrote for the online magazine Slate.
But Bradley A. Smith, a former chairman of the Federal Election Commission who has urged the court to overturn the precedents, said that the "sky-is-falling rhetoric of the other side is simply not true."
Smith, a Republican appointee to the commission who is now a law professor at Capital University in Ohio, said there is no evidence that corporations would spend millions of dollars targeting specific lawmakers.
While nearly half the states ban or greatly restrict corporate spending on behalf of candidates -- and could have their laws rendered unconstitutional by the court's decision -- the rest do not, Smith said. States such as California, Texas and Virginia allow corporate spending, without the "predicted catastrophes" advanced by advocates of campaign finance reform, he said.
That the court is considering such a broad challenge to corporate spending is a surprise. The case at hand arises from a conservative group's production of a scathing look at Clinton produced during her run for the 2008 Democratic presidential nomination.
A lower court said the film ran afoul of a McCain-Feingold provision that forbids corporations, unions and special interest groups from using money from their general treasuries for "any broadcast, cable or satellite communications" that refer to a candidate for federal office during election season.
In the past, that has meant 30-second to one-minute campaign ads. But the lower court said the same rule applied to Citizens United's 90-minute film about Clinton, which it proposed to broadcast on demand on cable channels.
But during oral arguments in March, conservative justices were more interested in the larger questions of how far government could go to corral corporate spending. Even though the law is specifically about broadcasts, justices asked the government's lawyer whether the ban could include books that endorsed a candidate.
When the deputy solicitor general said that theoretically it could, the justices seemed rattled.
"It's a 500-page book, and at the end it says, 'And so vote for X.' The government could ban that?" Roberts asked.
Instead of deciding the case at the end of the term in June, the court set a special hearing for Sept. 9 to decide whether to overturn its two precedents.
One was the court's 5 to 4 decision in 2003 declaring McCain-Feingold constitutional.
That decision cited the court's 1990 ruling in Austin v. Michigan Chamber of Commerce, in which it upheld a state law banning corporations from using their profits for ads supporting or opposing candidates. Congress had done the same for corporations and unions in 1947 regarding federal elections, and a ban on direct corporate contributions to candidates dates to 1907 and President Theodore Roosevelt.
The issue has united conservatives and split liberals, who generally support campaign finance restrictions but are torn about the restrictions on political speech.
Noted First Amendment lawyer Floyd Abrams is representing Senate Minority Leader Mitch McConnell (R-Ky.), who originally urged the court to strike down McCain-Feingold and has been allowed to intervene in next week's hearing. An association of reporters is also worried that the law's exemption for the news media is either not broad enough to support new forms of expression, or that that law could be changed in the future.
Supporters of McCain-Feingold criticized the justices' move as an abandonment of the court's policy of sticking by its precedents even when its membership has changed. Justice Sandra Day O'Connor, who provided the necessary vote to find McCain-Feingold constitutional, was replaced by Alito, who is skeptical.
"The court is not supposed to turn on a dime because of a change in justices," said Trevor Potter, a former Federal Election Commission member who advised McCain and supports the legislation.
But Steve Simpson, senior attorney for the Institute for Justice, said justices may have become frustrated with trying to balance McCain-Feingold's restrictions on campaign finance with the constitutional guarantee of free speech. "A number of principles are sort of banging into each other here," he said.
There is not much mystery about where the justices stand. Anthony M. Kennedy, Antonin Scalia and Clarence Thomas have said Austin should be overruled, and have been consistent critics of the campaign finance reform act.
Justices John Paul Stevens, Ruth Bader Ginsburg and Stephen G. Breyer have approved of the restrictions, as did David H. Souter, who recently retired.
This will be the first hearing for Souter's replacement, Justice Sonia Sotomayor. But judging from the decisions and speeches she has made about the dangers of campaign contributions, it would be a surprise if she voted differently from Souter.
Roberts and Alito are key. Both have supported every challenge to McCain-Feingold since joining the court, loosening some of the law's restrictions, but so far they have been reluctant to declare prohibitions on corporate spending unconstitutional.
The oral argument is also the first for Solicitor General Elena Kagan. She has warned the court that it should not undermine such a "long-standing and central principle of federal and state campaign finance law" without a more detailed record of what it would mean.
Her counterpart, coincidentally, is a former solicitor general, Theodore B. Olson, whose duty it was in 2003 to defend McCain-Feingold. Now, his brief for Citizens United reinforces the threats of "criminalization" of speech that worried justices at the oral argument:
"When the government of the United States of America claims the authority to ban books because of their political speech, something has gone terribly wrong and it is as sure a sign as any that a return to first principles is in order."