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Ciara Torres-Spelliscy, Could Connecticut Be the First to Get Serious about Shareholders Rights Post-Citizens United? (2012)Clicking on the button will copy the full recommended citation.
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Ciara Torres-Spelliscy, Could the SEC Please Give Democracy a Hand? (2012)Clicking on the button will copy the full recommended citation.
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Ciara Torres-Spelliscy, Double Barrel Blast from Big Sky Country: Montana Rejects Citizens United (2012)Clicking on the button will copy the full recommended citation.
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Ciara Torres-Spelliscy and Kathy Fogel, Shareholder-Authorized Corporate Political Spending in the United Kingdom, 46 U.S.F.L. Rev. 525 (2011)Clicking on the button will copy the full recommended citation.
The U.S. is facing the advent of unfettered corporate political expenditures as a result of the U.S. Supreme Court’s Citizens United decision. This decision sets precedence to allow publicly-traded corporations to use vast amounts of corporate treasury money to fund political advertisements in federal election campaigns without any sort of disclosure or shareholder consent. Similar policy concerns have been addressed by U.K. laws in 2000. In this paper, we present evidence on the effect of the 2000 and 2006 Amendments to Companies Act of the United Kingdom that provide shareholders with the ability to consent or object to future corporate political spending and a new dual disclosure system that requires companies to report political spending to shareholders in annual reports, while the political parties to report the source of their funding to the voting public through the Electoral Commission.
We obtain data on management proposals requesting shareholder voting on future corporate political expenditure by Britain’s publicly traded companies and the actual corporate political spending. We show that the U.K. Companies Act has not acted as a ban on corporate political spending. To the contrary, companies that seek approval of political budgets nearly always get them approved by shareholders. However, the political budgets that are sought by managers and approved by shareholders are typically modest – ranging from £50,000 to £100,000. In addition, actual corporate political spending for publicly-traded companies in the U.K. is far below the overall shareholder-authorized amounts. Lastly, our data reveal that since the 2000 Amendments, political spending appears to have migrated from publicly-traded companies to privately-held companies in the past decade.
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Ciara Torres-Spelliscy, Has the Tide Turned in Favor of Disclosure? Revealing Money in Politics After Citizens United and Doe v. Reed, 27 Ga. St. U. L. Rev. 1057 (2011)Clicking on the button will copy the full recommended citation.
This article will cover a short but tumultuous period in the history of campaign finance disclosure law from 2007 to 2010 to highlight the dramatic 180 degree turn that the law has taken on the issue of the constitutionality of disclosure within the past four years. First, I will explore the hostility that many lower courts were exhibiting in the short window between the Supreme Court’s decision in Wisconsin Right to Life II (WRTL II) in 2007 and the Supreme Court’s decision in Citizens United v. FEC in 2010. Basically these lower courts made the mistake of applying WRTL II to disclosure laws. This mistake was corrected by the Supreme Court in Citizens United and Doe v. Reed in 2010. After Citizens United and Doe, lower courts all over the country have adopted the Supreme Court’s view that disclosure and disclaimers can be constitutionally applied to advertisements that feature candidates for office directly before an election. And lower courts have gone further to endorse disclosure around ballot measure fights as well. In other words, in the nation’s courts the tide has turned in favor of disclosure of the sources of money in politics.
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Ciara Torres-Spelliscy, Hiding Behind the Tax Code, the Dark Election of 2010 and Why Tax-Exempt Entities Should Be Subject to Robust Federal Campaign Finance Disclosure Laws, 16 Chapman Journal of Law and Public Policy 59 (2011)Clicking on the button will copy the full recommended citation.
If the past is prologue, we should anticipate a marked increase in the use of non-profits to mask for-profit money in politics. History shows that for-profit corporations spend through non-profits to enjoy their anonymity while spending without accountability from shareholders or customers. And Citizens United may only expand this corporate habit of spending through intermediaries. If for-profit corporations are purposefully using non-profits to hide the true source of their funds, then it is possible that the degree of disclosure required of non-profits in the future may have an impact on whether for-profits give money to ideological and politically active non-profits.
Citizens United changed many aspects of American campaign finance law. The Supreme Court’s decision ended decades-old restrictions on the use of union and corporate treasury funds to pay for independent expenditures and electioneering communications. But the one area where the Citizens United Court increased the ability of Congress to regulate was the disclosure of the sources of money in politics. Indeed, the Supreme Court found that the Bipartisan Campaign Reform Act of 2002’s (BCRA’s) disclaimer and disclosure provisions could be constitutionally applied to the plaintiff in Citizens United, a 501(c)(4) organization, as well as to its ads and its film entitled “Hillary: The Movie.”
As Citizens United reaffirms, in order for voters to make informed choices at the ballot box, they must know who is paying for each side of a political fight. Campaign finance disclosure and disclaimer laws should be adopted at the federal level to achieve this end, regardless of the tax status of the spender. Yet the question remains, how expansive is this governmental right to mandate disclosure? And in particular, what types of disclosure can non-profit social welfare organizations or trade associations be subject to in the future once they purchase political advertisements? These are the questions that this article will endeavor to answer.
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Ciara Torres-Spelliscy, Corporate Political Spending & Shareholders Rights: Why the U.S. Should Adopt the British Approach, in Risk Management and Corporate Governance (Abolharran Jalilvand and Tassos Malliaris eds., Routledge, 2011)Clicking on the button will copy the full recommended citation.
American shareholders lack the ability to consent to political spending by corporations. Indeed, because of gaps between corporate and campaign finance law, U.S. corporations can make political expenditures without giving shareholders any notice of the spending either before or after the fact. This is problematic because the political interests of the managers who spend the corporate money may diverge from the political interests of shareholders who provided the funding.
By contrast, British companies must seek permission from shareholders to make political expenditures under the Political Parties, Elections and Referendums Act of 2000 and must report such spending to U.K. shareholders on an annual basis.
Shareholders in U.S. companies have been protected by a century’s worth of election laws which limited the amount of money that could be spent in federal elections by corporations, unions and banks. Corporations are required to pay for federal political expenditures through corporate political action committees (PAC's). This PAC requirement was struck in Citizens United, a Supreme Court decision dated January 21, 2010.
The federal corporate PAC requirement safeguarded the interests of shareholders in particular because most investors are unaware of how, when or why corporations make political expenditures. For example, in states that lack federal-style election rules, corporations may give political donations directly from their corporate treasuries (money in the corporate treasury includes funds from the sale of stocks and products). Corporations can spend money on politics without consent from or notice to shareholders.
The shareholder may not know who the corporation supports or may even actively disagree with who the corporation supports. By contrast, if a shareholder chooses to give to a corporate PAC, then the shareholder is fully on notice that the money will be used for a political purpose and there is meaningful consent in the transaction.
The laws that require corporations to pay for political expenditures through corporate PAC's are under legal attack in the courts. Most recently, the Supreme Court overruled Austin v. Michigan Chamber of Commerce and part of McConnell v. Federal Election Commission-two cases which required corporations to conduct political spending through corporate PAC's.
The Supreme Court used Citizens United as an opportunity to expand corporate speech rights. This new development in the law has hurt shareholders by allowing corporate managers to use corporate treasury funds to make political expenditures.
A recent study, “Corporate Political Contributions: Investment or Agency?” by Aggarwal, Meschke, and Wang (2009) found that large corporate political expenditures are linked with lower shareholder value and poor corporate management. In other words, managers make political donations because they want to, not because giving will necessarily benefit the corporations they manage. Overruling Austin and part of McConnell will give poor managers even more venues in which to spend shareholders’ investments on political expenses.
By exploring both campaign finance law and corporate law, this paper, “Political Spending & Shareholders’ Rights,” will argue that the U.S. should adopt the British approach to corporate political expenditures. In the first instance, U.S. corporations should disclose their political spending directly to shareholders and they should give shareholders the opportunity to consent to political spending. These reforms will improve corporate governance and minimize corporate risk.
The need for this reform has become heightened with the Supreme Court’s Citizens United decision. In a world where corporations can spend an unlimited amount corporate treasury funds on federal and state elections, shareholders will need new protections to guard against self-interested political spending by corporate managers.
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Ciara Torres-Spelliscy et al., Improving Judicial Diversity, in Women and the Law (Thomson/West, 2009)Clicking on the button will copy the full recommended citation.
The United States is more diverse than ever, but its state judges are not. While we recognize that citizens are entitled to a jury of their peers who will be drawn from a pool that reflects the surrounding community, Americans who enter the courtroom often face a predictable presence on the bench: a white male. This is the case despite increasing diversity within law school populations and within state bars across the country. Most of the legal disputes adjudicated in America are heard in state courts. As such, they must serve a broad range of constituencies and an increasingly diverse public. So why are state judiciaries consistently less diverse than the communities they serve? Unfortunately, studies show that both merit selection systems and judicial elections are equally challenged when it comes to creating diversity. Today, white males are overrepresented on state appellate benches by a margin of nearly two-to-one. Almost every other demographic group is underrepresented when compared to their share of the nation’s population. There is also evidence that the number of black male judges is actually decreasing (one study found that there were proportionately fewer black male state appellate judges in 1999 than there were in 1985). There are still fewer female judges than male, despite the fact that the majority of today’s law students are female, as are approximately half of all recent law degree recipients. This pattern is most prevalent in states’ highest courts, where women have historically been almost completely absent.
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Ciara Torres-Spelliscy, A Bench That Looks Like America: Diversity Among Appointed State Court Judges, 48 Judges' Journal 12 (2009)Clicking on the button will copy the full recommended citation.
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Ciara Torres-Spelliscy and Ari Weisbard, What Albany Could Learn from New York City: A Model of Meaningful Campaign Finance Reform in Action, 1 Alb. Gov't L. Rev. 194 (2008)Clicking on the button will copy the full recommended citation.
New York State used to be at the forefront of campaign finance reform. But over the past three decades, the State has fallen further and further behind the nation’s best practices. Now it has contribution limits that are sky high, riddled with loopholes, and subject to lax enforcement. Compounding these problems is a pay-to-play culture in Albany where candidates can use campaign funds to improve their personal day-to-day lifestyles. Most of these issues could be addressed with a properly designed public financing system coupled with pay-to-play regulations. Many of the reforms Albany needs have already been tried in New York City. Reformers in Albany, therefore, need look no further than down the Hudson for examples of best practices in campaign finance. This article explores six key areas where New York State law needs improvement in its approach to campaign finance reform and where New York City provides meaningful examples of better or best practices: (1) contribution limits; (2) candidates’ personal use of campaign funds; (3) pay-to-play; (4) disclosure; (5) enforcement; and (6) public financing.