New Life for Corporate Speech - Wisconsin Right To Life

Thursday, November 1, 2007 - 00:00

Political speech by corporations and labor unions during election periods received a major boost in the U.S. Supreme Court's June 25, 2007, decision in FEC v. Wisconsin Right to Life, Inc . ("WRTL"). This case was of intense interest by those who represent business organizations in Washington. We modestly note that Wiley Rein's amicus curiae brief on behalf of the U.S. Chamber of Commerce was mentioned by the controlling opinion as a sign of the importance of the case.

Under WRTL, corporations and unions still may not expressly advocate the election or defeat of clearly identified candidates or coordinate their ads with candidates. However, they now may refer to candidates while independently broadcasting issue ads during election periods, unless "the ad is susceptible of no reasonable interpretation other than as an appeal to vote for or against a specific candidate."

The WRTL test is narrowly and strictly applied. It focuses on what is said, rather than the speaker's subjective intent or the likely effect of the speech. Advocacy cannot be forbidden solely because it addresses issues relevant to the election. The speech must be allowed if it has any reasonable meaning other than advocating a candidate vote. And if there is room for debate "the tie is resolved in favor of protecting speech."

Chief Justice Roberts wrote the controlling opinion, joined by Justice Alito. Justices Scalia, Kennedy, and Thomas joined in a concurring opinion that wanted to go even further to overrule previously sustained limits on corporate speech. Significantly, Justice Alito indicated he would be willing to go along if the present holding proves unworkable. The remaining four justices dissented. Because there was no majority opinion and Chief Justice Roberts' opinion provides the narrowest rationale for the outcome, it functions as the opinion of the Court.

WRTL points in a very different direction from the 2003 McConnell v. FEC decision. There five justices (including the four current dissenters) displayed little concern for the speech rights of corporations. They held that a new statutory limit on corporate and labor union broadcasts that mentioned candidates in the months before elections - "electioneering communications" - was not invalid on its face.

Interestingly, the WRTL decision does not squarely overrule McConnell . Instead, it assumes the electioneering communications standard is a facially valid standard, but holds that it may not constitutionally be applied to speech that has any meaning other than a call to vote for or against a specific candidate.

However, seven Justices described the WRTL holding as effectively overruling McConnell . The four dissenters said the practical effect of the new "as applied" standard is to reinstate the "express advocacy" test Congress sought to replace by enacting the "electioneering communication" provision affirmed in McConnell . Similarly, Justice Scalia noted in his three-Justice concurring opinion that Chief Justice Roberts' opinion "effectively overrules McConnell without saying so."

Exactly how corporations should apply this new standard - "the ad is susceptible of no reasonable interpretation other than as an appeal to vote for or against a specific candidate" - in light of the opinions by Justice Souter and Scalia is not immediately apparent. In explaining why the particular ads at issue were not subject to regulation, Justice Roberts referred to various "indicia of express advocacy"- e.g., a focus on the character and quality of the mentioned candidates - that the ads lacked. Foreseeably, pro-regulatory advocates are attempting to graft those comments onto the basic test.

Some guidance may be in the offing. On August 31, the FEC initiated a rulemaking proceeding to not only conform its regulation of "electioneering communications" to WRTL , but to address whether the FEC's regulatory definition of "express advocacy" should also be reexamined in light of WRTL . A large number of written comments were submitted in response, and witnesses appeared before the Commission on October 17-18. (Author Jan Baran testified for the U.S. Chamber of Commerce.)

While every party to the rulemaking appears to recognize that some change in the FEC's regulation of "electioneering communications" is required in the wake of WRTL , no similar consensus has emerged regarding the FEC's definition of "express advocacy." The written comments and witnesses generally agreed that subpart (a) of the FEC's present definition, which focuses on the express meaning of the explicit words used, is consistent with WRTL. However, proponents of free speech for business (including Mr. Baran) contended that subsection (b) - which turns on what a reasonable person would understand in light of the circumstances - is impermissible. (Interestingly, several federal courts struck down subsection (b) before McConnell was decided).

The FEC doubtless will try hard to complete its rulemaking. However, four of the present five Commissioners (two Republicans and three Democrats with one seat vacant) must agree to adopt a rule, and agreement may prove elusive.

One lesson of the new case is that corporations charged with improper electoral speech should carefully consider an "as applied" challenge to whatever standard is being applied. Also, in an appropriate case, consideration should be given to squarely challenging existing restrictive precedent that slights the First Amendment. And until more guidance arrives, consideration should be given to avoiding unnecessary "indicia of express advocacy" in corporate issue speech.

This article was authored by the Election Law & Government Ethics Practice Chair Jan W. Baran, Partner Thomas W. Kirby and Associate Caleb P. Burns.

Please email the authors at jbaran@wileyrein.com, tkirby@wileyrein.com or cburns@wileyrein.com with questions about this article.