Personalizing the Impersonal:
Corporations and the Bill of Rights

Editor's note: This lengthy law review article offers the most thorough legal analysis to date of the process by which corporations have seized specific constitutional rights. For anyone relatively new to exploring corporate personhood, we suggest starting with a look at this comprehensive web page.

:Between 1989 and 1992 Americans will celebrate the bicentennial of the ratification of the Bill of Rights. Even more than average citizens, however, corporations and their managers are marking this anniversary with approval*1 because they successfully have used the Bill of Rights as a shield against government regulation. Businesses now wield the Bill of Rights in much the same way that the fourteenth amendment was used during the Progressive era when corporations impeded state governmental regulation with constitutional roadblocks. In this sense, the supposedly defunct doctrine of substantive due process*2 -- under which the [*578] Court imposes its own economic views to strike down regulation -- retains surprising vitality. Indeed, the current era can be characterized as one of corporate due process.

Consider, for example, the following recent Supreme Court decisions: a textile corporation successfully invoked the fifth amendment double jeopardy clause to avoid retrial in a criminal antitrust action;*3 a consortium of major corporations, including the First National Bank of Boston, joined in a first amendment lawsuit that overturned state restrictions on corporate spending for political referendums;*4 an electrical and plumbing concern invoked the fourth amendment to thwart federal inspections conducted under the Occupational Safety and Health Act;*5 and, a California public utility relied on the first amendment to overturn state regulations designed to lower utility rates.*6

Twenty years ago, the corporation had not deployed any of these Bill of Rights provisions successfully.

The corporation's invocation of the first ten amendments symbolizes the transformation of our constitutional system from one of individual freedoms to one of organizational prerogatives. Regarded as America's most cherished palladium of personal liberties, the Bill of Rights was appended to the Constitution at the behest of Jefferson and inherited, ideologically, from political philosophers concerned with individual liberties: Locke, Rousseau, and Montesquieu. The use of these amendments by corporations raises extraordinary historical and political questions.

This Article explores why, as an historical matter, the Supreme Court only recently conferred Bill of Rights guarantees on corporations. It [*579] also asks: what theory of the corporation*7 permits the Court to bestow these protections? Part I argues that intangible Bill of Rights protections are, in an unprecedented manner, important to the corporation in the modern political economy. Whereas the fourteenth amendment was useful in the nineteenth and early twentieth centuries to shield corporations from rudimentary, sporadic attempts by states to regulate, the Bill of Rights today helps corporations fight more sophisticated modern federal regulation. Part II explains why, although the Court increasingly confers Bill of Rights safeguards on corporations, it has abandoned earlier efforts to theorize about the corporation's entitlement to constitutional protections. This Part also suggests that the Court currently lacks a coherent or defensible theory of the corporation. Part III considers the future of the Bill of Rights and corporate theory.

I. The Corporate Bill of Rights in the Modern Political Economy

A. The Rise of Corporate Theory

To understand how the corporation -- as opposed to individuals -- can claim any constitutional rights, a review of corporate personhood theory is required.

The Constitution does not mention corporations.*8 To claim legal status, nineteenth century lawyers argued that corporations should be considered "citizens" or "persons" for application of various constitutional provisions. The Supreme Court has examined whether corporations are citizens under the following provisions: article III diversity jurisdiction,*9 article IV privileges and immunities clause,*10 and the fourteenth [*580] amendment. *11 Most of these cases were decided early in the nineteenth century -- before significant government economic regulation -- and involved the corporation's right to sue or be sued.

The Supreme Court's most renowned decisions, however, were in the 1880s and 1890s, holding that corporations are persons for the purpose of fourteenth amendment equal protection*12 and due process.*13 These opinions paved the way for companies to receive the benefits of Lochner era substantive due process and the Court's invalidation of state economic regulation prior to the New Deal.*14

Two competing visions of corporate personality influenced the Court's nineteenth century decisions,*15 and to some degree still underlie modern opinions. The first and most traditional notion was the "artificial entity" theory viewing the corporation as nothing more than an artificial creature of the state, subject to government imposed limitations and restrictions.*16 This theory had its origins in English corporation law,*17 and in antebellum legislatures' practice of considering incorporation a special privilege, awarded by the state for the pursuit of public purposes.*18 Under this view, corporations cannot assert constitutional rights against the state, their creator.*19

The second vision was the "natural entity" or person theory. This theory regards the corporation not as artificial, but as real, with a separate existence and independent rights. It is associated with continental theorists who, at the turn of the century, wrote about "group" or "corporate" [*581] personality in an effort to challenge individualism and to come to terms with institutions of modern society such as corporations, trade unions, universities, and professional associations.*20 This understanding of the corporation most favors corporate constitutional rights.*21

These competing paradigms of the corporation were in tension in the Court's nineteenth century opinions. The "artificial entity" theory was invoked to deny corporations constitutional protection; the "natural entity" theory was used to accord them safeguards.*22 Competing corporate theories advanced by the Court reflected the theoretical debates in the treatise literature over the nature of corporate personality.*23

The personification of the corporation occurred in 1886; the popular literature marks this as the year that the corporation "stole" the fourteenth amendment.*24 In Santa Clara County v. Southern Pacific Railroad*25 the Court simply decreed, without hearing argument, that a corporation is a person for purposes of the fourteenth amendment. At issue was whether the due process clause barred the State of California from taxing the property of a railroad corporation differently from that of individuals. By the early twentieth century, the natural entity theory was established firmly, if not permanently. *26

[*582] To understand why the corporation did not assert theories of corporate personality in the Bill of Rights context until the twentieth century, and to understand the recent interest in the corporate Bill of Rights, one must first survey the political economy of regulation as it developed in the twentieth century.

Two questions must be answered. First, how did regulation change in its form, content, and purpose over the century? Second, what legal and constitutional implications did regulatory changes have for corporations?

B. The Bill of Rights and an Evolving Political Economy

Despite earlier assertions of corporate personhood in the fourteenth amendment context, corporations did not come to rely on Bill of Rights protections until quite recently. As late as 1960 the corporation arguably enjoyed only the protection of the fifth amendment's due process clause.*27 Today, the corporation boasts a panoply of Bill of Rights protections: first amendment guarantees of political speech, commercial speech, and negative free speech rights; fourth amendment safeguards against unreasonable regulatory searches; fifth amendment double jeopardy and liberty rights; and sixth and seventh amendment entitlements to trial by jury.*28

The evolution of the modern political economy and the modern regulatory state in part account for this striking change. Changes in America's political economy, over the course of the twentieth century, gradually enticed corporations to assert Bill of Rights protections against a changed regulatory state and increasingly to protect modern forms of intangible commercial property (like speech or federal subsidies).*29

[*583] The corporation faced different kinds of regulation in three separate political periods: the Progressive era, the New Deal era, and the Modern, post-1960 era. Each of these eras was characterized by distinct political economies and regulatory structures. Within each period there were bitter struggles over how, and for what purpose, the regulatory state would assert its power.*30

During the course of the twentieth century the political and regulatory environment consistently changed in ways that dramatically altered the legal and constitutional strategies of corporations. Over time, regulation became more federal and intrusive in character, property became more intangible and ephemeral, and regulation became explicitly designed to serve environmental, consumer, and social -- rather than economic -- goals. Each development encouraged the corporation to assert Bill of Rights privileges and to abandon the previous, increasingly ineffective, strategy of relying on fourteenth amendment protections.

(1) Progressive Era Regulation

a. The Political Economy

Before and during the Progressive era, the corporation frequently asserted fourteenth amendment rights against state regulation.*31 But during this epoch, federal regulation remained rudimentary and only infrequently triggered Bill of Rights claims.*32

Progressive era regulation was irregular and primarily microeconomic in nature.*33 It included laws passed chiefly to regulate railroads, to curb the power and size of monopolies, to tax income and wealth, and, only later, to improve working conditions. Regulation was [*584] conducted primarily by state government.*34 Only gradually did the federal government become the focus of regulatory reformers.*35

Historically, the federal government played a diminished regulatory function because states and localities assumed primary responsibility.*36 Undoubtedly, a fear of centralized regulatory authority stemmed from America's Revolutionary War experience. Regulation in America originally was conceived as a means of writing into state charters restrictions on corporate activity.*37 In Massachusetts, for example, the first state railroad corporations, created in the 1830s and 1840s, had economic restrictions embedded in their charters. *38 Some statutes even went so far as to define precisely acceptable rates of return. These controls, however, rarely were enforced.*39

As the century progressed, the source of regulation shifted from weak charter provisions to pronouncements from state regulatory commissions.*40 These commissions -- created first in Rhode Island, New Hampshire, and Connecticut -- were founded primarily to oversee the railroads' rate-making process.*41 The most famous of these was the Massachusetts Board of Railroad Commissioners, founded by Charles Francis Adams in 1865.*42 The Commission was unlike modern regulatory agencies. Rather, it was akin to a "sunshine" commission: dedicated to information and education rather than direct action.*43

[*585] This philosophy of voluntarism reflected the patrician origins of the early regulatory commissioners.*44 Their weak version of regulation was evident in the safety area, where commissions customarily would investigate railroad accidents and then urge voluntary reform on industry.*45 Only in the late 1880s and 1890s did state regulatory commissions take stronger measures such as setting rates for gas and electric utility monopolies.*46

State regulation was even more aggressive in the early twentieth century when the Progressive movement gained stature. The states became "laboratories" of social reform, as wage and hour legislation and child labor laws, among others, were passed.*47

Progressives harbored a deep ambivalence to federal regulation, and often preferred state controls.*48 Louis Brandeis, the Progressive era's most celebrated reformer, typified this attitude in the fight over the reform of industrial life insurance, one of his most important causes. Brandeis believed that the entire industry principally served to defraud working people of their life savings. His solution, however, was to impose strict state, rather than federal, regulation of the insurance industry. Brandeis believed that federal regulation would lead to capture of the national legislature by the industry, but that the insurance industry could never capture every statehouse.*49

The federal government did intercede in the economy during this period, but almost always in a sporadic manner for economic (as opposed to environmental or social) purposes. The establishment of the Interstate Commerce Commission (ICC) in 1887 marked the beginning of this [*586] trend. The Sherman Antitrust Act of 1890*50 and the Federal Trade Commission Act of 1914*51 followed. These regulatory efforts involved microeconomic questions: the ICC dealt with anticompetitive practice in the railroad industry; the Sherman Act targeted restraints of trade or conspiracies; and the FTC's chief mandate was to prohibit unfair methods of competition or deceptive trade practices.*52

The first federal regulatory agency, the ICC, was established to regulate railroads, America's only national industry. The ICC primarily was concerned with setting rates and gathering information and, therefore, served as a weak federal agency.*53

Although the Sherman Antitrust Act was passed in 1890, it relied on the resources of the Justice Department for sanctions and was enforced only sporadically prior to the height of the Progressive era. From 1890 to 1905, The Justice Department brought only twenty-two suits -- on average 1.5 per year. The number increased to thirteen per year over the next decade as Presidents Roosevelt, Taft, and Wilson demonstrated a stronger commitment to trust busting, as evidenced by the passing of the Clayton Antitrust Act in 1911.*54

Not until Woodrow Wilson created the Federal Trade Commission in 1914 was the trust question broadly addressed. The Commission was intended to increase competition and solve the merger problem that dominated the American political scene from 1890 to 1920.*55 The Commission, however, was not particularly effective prior to the New Deal. The recession of 1914 gave Wilson and the Democrats the stigma of having regulated prosperity out of the economy. Also, the outbreak of World War I shifted the public's interest from trust busting to international politics. Indeed, the investigatory power of the Federal Trade Commission was limited explicitly by Wilson, who stopped short of altering [*587] the relationship between business and government. The FTC had no power over prices, wages, mergers, or stock offerings. It was limited in scope to correcting unfair trade practices as defined by common-law interpretation of the Sherman Act.*56

Despite the intellectual fervor of the time, federal regulatory agencies never posed ongoing regulatory challenges to business during the Progressive era;*57 certainly not in a way that invoked the ire of the business community as have modern environmental and health and safety legislation. More importantly, the government rarely acted in such a way as to pose major Bill of Rights questions for corporations.*58

[*588] b. The Corporate Legal Response

The response of corporations to the evolution of state regulatory mechanisms was not surprising; constitutional challenges were posed, under the fourteenth amendment, to state statutes. Within the context of the political economy of the nineteenth and early twentieth centuries, intangible Bill of Rights protections had little relevance for corporate actors.

Lochner illustrated how the fourteenth amendment and the doctrine of substantive due process were used to invalidate state regulation. In Lochner the Supreme Court held unconstitutional a New York State statute limiting the number of hours employees could work in a bakery. The challenge was brought by a bakery owner who maintained that the statute interfered with his freedom to contract and was therefore invalid under the fourteenth amendment.*59

Lochner did not involve a corporate plaintiff; but by reading a substantive economic doctrine into the fourteenth amendment -- the doctrine of laissez-faire and freedom of contract -- the Court provided a powerful wedge for corporations. Since corporations had fourteenth amendment protections under Santa Clara, the addition of Lochner allowed corporations to challenge many state regulations.

For the next fifty years, under the banner of substantive due process, and in the guise of "persons," corporations challenged Progressive era [*589] regulation and maneuvered to protect more traditional forms of property.*60

Once armed with the fourteenth amendment, corporations wielded it with considerable force. By 1938 Justice Hugo Black observed with dismay that, of the cases in which the Court applied the fourteenth amendment during the first 50 years after Santa Clara, "less than one-half of 1 percent invoked it in protection of the Negro race, and more than 50 percent asked that its benefits be extended to corporations."*61 The use of the fourteenth amendment to strike down state interferences with an increasingly corporate-dominated marketplace proceeded until the 1930s when the Court abandoned substantive due process.*62

From the 1905 Lochner decision until the middle of the 1930s, the Court invalidated approximately two hundred economic regulations, usually under the due process clause of the fourteenth amendment; many of the challenges were brought by corporate plaintiffs. Most decisions centered on labor legislation, the regulation of prices, and restrictions on entry into businesses.*63 Cases involving corporations often concerned state restrictions on entries into a new business.*64

Corporations continued to challenge state regulations using the fourteenth amendment until the doctrine of substantive due process was abandoned by the New Deal Supreme Court. In West Coast Hotel Co. v. Parrish,*65 for example, the Supreme Court upheld the constitutionality of state legislation establishing a minimum wage for women. The Court rejected the corporate plaintiff's assertion that its common-law right to freedom of contract was violated.*66

[*590] The business press recognized the fourteenth amendment's vital role in protecting corporate interests. A 1936 Fortune magazine article opined that

[T]he effect [of granting corporations fourteenth amendment rights] was to impose between the state legislatures and the industries of the country the judgment of the Supreme Court and to insure to individual businessmen complete freedom from state regulation other than that which the Supreme Court held to be a proper exercise of governmental power. All this the words "due process of law" were held to imply.*67

The article even suggested that the Court's defense of substantive due process was arguably the corporation's most important weapon against Progressive era reforms.*68

Although business defended against government regulation by using fourteenth amendment property-oriented safeguards, Bill of Rights protections rarely were sought. When invoked, they were used to defend tangible property against economic regulation and operated much like due process property protections.

Corporations first received Bill of Rights guarantees in 1893. In Noble v. Union River Logging Railroad,*69 a railroad corporation invoked the fifth amendment due process clause to challenge the Secretary of the Interior's revocation of an approval for a right-of-way over federal public [*591] lands. The Court invalidated this action, viewing it as an attempt to deprive the railroad corporation of its property without due process.*70 Although the Court in Noble did not explain why the fifth amendment due process clause -- as opposed to the fourteenth amendment clause -- should apply to corporations, no other interpretation is possible, because the defendant was the federal government.*71

Decided on the heels of opinions granting fourteenth amendment guarantees to corporations,*72 Noble represented an extension of due process property-oriented protections. In Noble the fifth amendment protected corporations' traditional property rights -- such as a right-of-way or an easement -- that were recognized at common law. Similarly, Noble thwarted Progressive era regulation. In this period the federal government regulated public lands for economic purposes; only later, in the 1960s, did it oversee them with an eye toward environmental, or social, objectives.*73

Not until the twentieth century did corporations receive more intangible Bill of Rights protections. Most Bill of Rights protections, of course, are intangible in the sense that they protect interests that one cannot feel or touch. The right to speak or the right to privacy are examples. Such intangible interests -- particularly commercial speech, the right to privacy, and the right to government largess (for example, a government [*592] license or contract) -- have become increasingly important to corporations over the course of the twentieth century.*74

Corporations did assert intangible Bill of Rights in the Progressive period, but only infrequently compared to the modern era. Only occasionally were fourth amendment privacy rights asserted against the weak and rudimentary federal agencies of the Progressive era: the Federal Trade Commission or the Justice Department in antitrust cases. This contrasts dramatically with the modern period when corporations frequently invoke fourth amendment safeguards against a plethora of federal agencies involved in many regulatory inspection programs.

Usually, companies sought protection from overbroad government subpoenas for corporate documents.*75 In practice, only the FTC, and occasionally the Justice Department (enforcing the Sherman Act), would issue such requests. Circumstances such as these led the business press, at least, to conclude that Bill of Rights protections were not important -- compared to the fourteenth amendment -- in the political economy of the first half of the twentieth century.

The first time a corporation claimed, and was granted, intangible Bill of Rights protections was in 1906. In Hale v. Henkel,*76 the Supreme Court held that an overbroad subpoena for corporate documents could constitute an unreasonable search and seizure in violation of a corporation's fourth amendment rights. Hale was an effort to forestall Progressive era regulation. The case involved a criminal contempt charge arising from an antitrust action under the Sherman Act against two tobacco corporations. In refusing to comply with a government subpoena for potentially incriminating documents,*77 the corporations advanced only one constitutional argument: the fifth amendment privilege against self-incrimination.*78 The Court held this privilege inapplicable to corporations, requiring the companies to produce the documents. *79 The Court raised the question, on its own, whether a corporation is entitled to fourth amendment protections against unreasonable searches and seizures. The answer was affirmative.*80 The Court further ruled that an overbroad [*593] subpoena for corporate documents constitutes an "unreasonable" search.*81

Several cases, decided before 1930, restricted the ability of government agencies to peruse corporate documents. The most famous was Federal Trade Commission v. American Tobacco Co.,*82 in which Justice Holmes held that the fourth amendment did not authorize government agencies "to direct fishing expeditions into private papers on the possibility that they may disclose evidence of crime."*83

While the fourth amendment provided some protection from government regulation, the use of the Bill of Rights as a corporate weapon was infrequent when compared with the use of the fourteenth amendment against state regulation.

(2) New Deal Regulation

a. The Political Economy

The regulatory state changed significantly during the New Deal. Federal regulation overshadowed state regulation and New Dealers added a concern for planning to the Progressive era antitrust impulse. But regulation remained primarily economic as opposed to social, consumer, [*594] or environmental. As a consequence, New Deal regulation, like Progressive era regulation, posed few Bill of Rights challenges for the corporation.

During the New Deal, macroeconomic management replaced microeconomic tinkering as the federal government worked feverishly to stimulate a moribund economy. The Federal Home Loan Bank Act, the Reconstruction Finance Corporation Act, the National Industrial Recovery Act, and the Agricultural Adjustment Act -- all passed between 1932 and 1946 -- attempted to speed economic recovery. *84 Social goals such as consumer protection and environmental regulation were deemphasized in this period of economic stagnation.*85

By the end of the 1930s, a plethora of federal regulatory agencies blossomed. Four new federal commissions were created, more than had appeared in the years prior to 1933: the Securities and Exchange Commission, the National Labor Relations Board, the Federal Communications Commission, and the Civil Aeronautics Authority.*86 Existing agencies were endowed with additional authority to regulate industry.*87

The New Deal elevated from the state to the federal level the Progressive era ideal of economic administration by technocratic experts.*88 Many New Deal reforms were designed to overcome the limitations of Progressive era regulation. After the stock market crash of 1929, for example, it became evident how little protection Progressive era measures, such as state "blue sky" laws, provided investors. "Blue sky" statutes originally were designed to protect against securities of doubtful value (pieces of the blue sky) and held great promise as antidotes to unscrupulous investment practices.*89 The New Deal solution to the failure of Progressive era state structures was to implement federal securities regulation.*90

[*595] Historians have penned volumes attempting to explain the meaning of the creation of these New Deal agencies and programs.*91 Forty years later, there is still no consensus on their purpose, intentions, or effects. Some of the most intriguing writing on the New Deal suggests that Roosevelt's regulatory programs reflected a division among advisors to the president. Divisions in regulatory programs and philosophies triggered dissimilar constitutional responses by business.

The split recognized is between planners and antitrusters.*92 The planners -- people like Jerome Frank and Rexford Tugwell -- supported direct government measures to regulate the economy. The National Recovery Administration (NRA) embodied this vision; to bolster prices the NRA sponsored a system of industrial organization that called for output restrictions to boost prices and for standardization of work practices and product quality. This type of intense industrial supervision was tailored to an economic system beset by a deflationary crisis. Advocacy of planning also reflected the recognition of a new, powerful constituency in favor of regulation, labor, that was less noticed in the Progressive era.*93 NRA-type planning in such areas as the regulation of trucking and airlines remained a component of the New Deal even after 1935, when the NRA was declared unconstitutional.*94

But after the first NRA phase of the New Deal, the antitrusters were ascendent.*95 Like the advocates of Woodrow Wilson's New Freedom, the antitrusters, or neo-Brandeisians, favored policies that would decentralize business and enforce competitive behavior. People like Thomas Corcoran, James Landis, Benjamin Cohen, and James Rowe -- disciples of Brandeis and Frankfurter -- advocated programs of decentralization: cheap power and rural electrification, and the social engineering of the [*596] TVA and the rural rehabilitation program.*96 They also favored reforms in areas of banking, securities, and holding companies.*97

Undoubtedly, both planners and antitrusters had an effect on the New Deal regulatory state and the historic debate over which camp attained the upper hand may never be resolved.*98

For the purposes of constitutional history, however, it is sufficient to suggest that neither reforms advocated by the planners or by antitrusters prompted Bill of Rights challenges by corporations. The new regulatory state erected during the New Deal did not create an intrusive system of monitoring, inspecting, and regulation -- for consumer, environmental, or social purposes -- that would later pose Bill of Rights threats to corporations.*99

Instead, the constitutional challenges mounted by corporations during this period were directed either at undermining the very legislative authority of New Deal proposals (these tended to be planning proposals), [*597] or in working within the administrative system to delay the existing regulatory process (these tended to be the antitrusters' programs).

b. The Corporate Legal Response

Corporate managers remained impassive about the Bill of Rights in the Progressive and New Deal eras, in part because these rights were not useful in fighting economic regulation, and in part because they had other constitutional battles to wage. Until 1937, the main event was the fight over substantive due process. With the end of the Lochner era and the election of Roosevelt, business interests challenged New Deal planning reforms as overbroad exercises of constitutional powers.*100 Later, due process challenges to the antitrusters' regulation increasingly were fought in the administrative context.*101

While the business press heralded the Supreme Court's substantive due process rulings,*102 it ignored the Court's Bill of Rights opinions regarding corporations.*103

But business' self-confessed satisfaction with the substantive due process shield was shortlived. As Fortune magazine put it, "after the 1929 crash and the advent of Franklin Roosevelt's New Deal . . . the Constitution again became a hot issue."*104

Citations to the Constitution riddled the business literature in the New Deal era. The Industrial Arts and the Business Periodicals Index -- the two principal indices of business literature -- contained numerous references to the constitutionality of Roosevelt's reform legislation.*105 No longer concerned with personhood, state regulation, and the fourteenth amendment, the focus shifted to restricting executive and congressional power exercised in the name of reform. The principal New Deal enactments [*598] rested on three constitutional powers: interstate commerce, taxation, and appropriation. Several of these were held unconstitutional.*106

The National Industrial Recovery Act, for example, which set industrial hours and wages, was held to be an unconstitutional delegation of power.*107 The type of regulation and planning symbolized by the NRA did not, however, provoke Bill of Rights challenges by corporations. Rather, because the NRA was a system of planning, it was challenged successfully as an unconstitutional delegation of legislative power and an overbroad application of the commerce power.*108 To the extent planning was an integral component of New Deal regulation, it represented a departure from Progressive era reforms conducted on the state level. But the goals of planning were primarily economic reform and price administration -- goals that raised constitutional questions other than Bill of Rights concerns.

Constitutional limitations on federal regulatory power supplanted debates over corporate personhood.*109 With the possible exception of publishing corporations, which claimed the first amendment exempted them from government antitrust prosecutions, Bill of Rights issues were completely overshadowed by other constitutional questions during the New Deal.*110

[*599] During this period, corporations also began to manifest their opposition to government regulation in the administrative arena. As New Deal reforms withstood constitutional challenges, and federal regulatory powers expanded, corporations fought regulation using tactics of delay in administrative law. The procedural provisions of the Administrative Procedure Act, for example, served as a stalling device for regulatory opponents.*111 Corporations came to realize that by insisting on procedural guidelines for agency decisions they could stall, if not forestall regulatory action.*112

This is not to say there was no litigation implicating the Bill of Rights in this era. Indeed, fourth amendment cases involving government subpoena power over corporate documents continued through the New Deal, building on the Progressive era Hale decision.*113

During the New Deal, however, the Court narrowly circumscribed the fourth amendment rights of corporations against overbroad government subpoenas.*114 In one case,*115 the Court permitted the Administrator of the Department of Labor, under the Fair Labor Standards Act, broad access to a corporation's documents and records.*116 In United [*600] States v. Morton Salt Co., *117 the Court upheld a broad request by the Federal Trade Commission that the well-known company produce a complete set of prices and terms for its products. The request was allowed even if it "was caused by nothing more than official curiosity."*118 The post-New Deal composition of the Court may have accounted for this temporary denial of Bill of Rights protections to corporations.

Commentators criticize Morton Salt for its complete contradiction of American Tobacco.*119 Indeed, by 1950, the Court seemingly snatched away any fourth amendment rights conferred in Hale and extended in American Tobacco. Arguably, except for the property-oriented fifth amendment due process clause, corporations had no Bill of Rights protections in 1950.*120 And, at least according to the business press, corporations and their managers were not particularly concerned. The corporation's true Bill of Rights battle was yet to come.

[*601] (3) Modern Regulation

a. The Political Economy

In the modern political economy, the Bill of Rights assumed new exigency for corporations. After 1960 what may be called Modern Regulation and Modern Property came to define the political economy. Modern Regulation targets social goals such as environmentalism. It is intrusive, and involves regularized inspections conducted principally by federal agencies (for example, EPA and OSHA) overseeing a wide array of economic sectors. Modern Property includes not only government-created wealth in the form of government contracts, but also the currency of post-industrial society -- knowledge and information. In response to these changes, corporations invoked the Bill of Rights to protect novel forms of property and to challenge modern regulatory structures.*121

Although regulation's role in the history of the American political economy remains controversial, there is one area of increasing agreement among business and government historians: regulation changes substantially, in nature and kind, in the period after 1960.*122 This transformation has important implications for the corporation and the Bill of Rights.

Four characteristics distinguish Modern Regulation. First, it differs in nature. In the Progressive and New Deal eras, most regulation was economic. Modern Regulation, however, strives to attain social goals: environmental protection, consumerism, minority employment, women's rights, and health and safety.*123 The Clean Air Act of 1970,*124 the Consumer Product Safety Act of 1972,*125 and the Occupational Safety and Health Administration Act of 1970*126 exemplify this type of regulation.*127

Second, Modern Regulation differs from earlier regulation in that it is conducted primarily on the federal level. Before 1960, whatever limited social regulatory programs existed were administered almost exclusively [*602] by state and local government.*128 Before 1965, only one federal regulatory agency whose principal responsibility was to protect consumers, employees, or the public from corporate activities was created: the Food and Drug Administration, founded in 1931. Between 1964 and 1977 ten federal agencies were created for this purpose.*129

Third, Modern Regulation is more instrusive, systematic, and routinized than Progressive or New Deal regulation. As laws and agencies increased in number and scope, the government encroached on what were formerly private corporate decisions. Corporate departments were "shadowed" by their alter egos in the regulatory bureaucracy; a plethora of statutes and regulations created elaborate new systems of reporting, monitoring, and whistle-blowing.*130 Whereas traditional regulation utilized irregular subpoenas of corporate documents, Modern Regulation instituted regular inspection of corporate premises and more.

Fourth, Modern Regulation governs many industrial sectors, not just one industry, and is broadly opposed by a wide coalition of corporate groups. Whereas agencies engaged in Progressive era regulation, such as the Interstate Commerce Commission, ordinarily supervised only specific industries, the new federal regulatory agencies, such as the Environmental Protection Agency, the Occupational Safety and Health Administration, and the Consumer Product Safety Commission, regulate many economic sectors at once: retail, trade, communication, services, utilities, and railroads.*131 This broad multisectoral regulation makes it difficult [*603] for one sector or industry to capture an agency in a manner that was possible in the Progressive or New Deal eras. But opposition to Modern Regulation has become a unifying point for corporate interests opposed to reforms passed at the behest of labor, consumer, and public interest groups.*132 One manifestation of this is the aggressive assertion of Bill of Rights protections for corporations.

This new type of regulation reflected the growth of consumerism and of the public interest movement; as the power of these two movements increased, they influenced government regulatory programs.*133 Undoubtedly, it also reflected some of the reform impulses of the 1960s, and the twin realizations of limits to growth and of the environmental consequences of such expansion.*134

New forms of property, as well as novel modes of regulation, are characteristic of the modern political economy. Since the 1960s, courts and commentators have come to recognize that wealth created by government is increasingly important in contemporary society.*135 This "state created property" takes many forms: government jobs, government benefits, occupational licenses, franchises, contracts, subsidies, and [*604] the use of public resources. Corporations, perhaps even more than individuals, benefit from this largess.*136

This government-created wealth is one component of Modern Property.*137 But the term is employed in a broader sense than simply government largess. *138 To take account of much sociological and political writing of the last twenty years, it is suggested that Modern Property includes the intangible currency of the Post-Industrial Society: knowledge and information.*139 Information in all its forms -- including its use to influence public elections and referenda -- is central to the modern political economy.*140 The defense of this Modern Property is an increasingly urgent corporate concern.

For courts and commentators in contemporary society, the rise of this Modern Property, defined here as government largess, circumscribed the individual's ability to exercise Bill of Rights protections. "When government -- national, state, or local -- hands out something of value, whether a relief check or a television license, government's power grows forthwith; it automatically gains such power as is necessary and proper to supervise its largess," writes one commentator. "It obtains new rights to investigate, to regulate, and to punish."*141 The overwhelming concern is that the government's new intrusive powers -- derived, mostly, from new forms of property -- would intimidate the individual and impair her ability to exercise Bill of Rights protections. A welfare recipient, for example, fearing the loss of her subsistence, probably would not assert fourth amendment rights against a government official knocking at the door.*142

[*605] No one, however, addressed the question of whether new forms of property put a similar pressure on corporate Bill of Rights protections as on the Bill of Rights as applied to individuals.*143 Modern Property does not impose such a burden for two reasons. First, Modern Property, as the term is used in this Article, includes possession of information and knowledge that is not contingent on government largess; defense of this property does not trigger a government counteraction. Second, corporations are better able to withstand the pressure of threats of withholding government largess than are individuals; common concerns about a tyranny of the majority are not present for the corporation.*144 If anything, the corporation aggressively uses the Bill of Rights to protect its Modern Property, and to stymie Modern Regulation, at the expense of individual rights.

The Modern Property and Modern Regulation classifications are not intended to be rigid and immutable. Rather, they indicate the direction in which property and regulation have headed over the course of the twentieth century. This direction has triggered a greater willingness and necessity on the part of corporations than earlier to assert Bill of Rights safeguards.

b. The Corporate Legal Response

Corporations reacted to Modern Regulation and Modern Property by invoking the Bill of Rights. This was not their only response. Indeed, [*606] opposition to Modern Regulation, expressed in the political and legislative arena, is now a unifying ideology of the corporate community.*145 But assertion of intangible Bill of Rights safeguards to protect Modern Property and to thwart Modern Regulation complements the ideological battle. Denied the protections of Lochner and substantive due process, corporate managers merely shifted the constitutional battle from the fourteenth amendment to the first, fourth, and fifth amendments. This has created a modern corporate substantive due process umbrella.

i. The Fourth Amendment

In the hands of the corporation, the fourth amendment has been an effective shield against the regulatory state. Not until 1977 did the Court consider the constitutional implications of routine health and safety inspections*146 -- the trademark of Modern Regulation. When it did, however, it insulated corporations from "surprise" inspections.*147

The Supreme Court's first analysis of Modern Regulation did not involve a corporation, but rather set the stage for later consideration of corporate fourth amendment rights. In See v. City of Seattle*148 the Court held that the principal tool of Modern Regulation -- the regulatory inspection -- requires a warrant.*149 The Court analogized to the predominant investigative technique used under old regulation: administrative subpoena of corporate books and records.*150 In See, a Seattle fire inspector attempted to inspect a commercial warehouse, without a warrant or probable cause, as part of a routine canvass to obtain compliance with Seattle's fire code. Appellant was arrested and contended that the inspection violated his fourth amendment rights. The Court framed the question in terms of the rise of federal regulation of "business enterprises," corporate or otherwise. "As governmental regulation of business enterprise has mushroomed in recent years, the need for effective investigative [*607] techniques to achieve the aims of such regulation has been the subject of substantial comment and legislation," noted the Court. *151 "Official entry upon commercial property is a technique commonly adopted by administrative agencies at all levels of government to enforce a variety of regulatory laws . . . ."*152

The Court deemed "untenable" the notion that a subpoena, which it dubbed a "constructive search," is subject to fourth amendment limitations that do not apply to actual inspections of commercial property.*153 The result: an administrative warrant is necessary to enter and inspect commercial premises. *154

Similarly, in the late sixties and early seventies a liquor corporation *155 and a firearms company*156 raised fourth amendment challenges to [*608] warrantless government inspections of commercial premises. Both challenges failed, in part because the Court found that industries endowed with state licenses, such as the liquor industry,*157 waived their fourth amendment rights. It appeared that corporations reliant on government largess, in this case for licensing, might have the same difficulty asserting Bill of Rights protections as individuals.

But these defeats proved only temporary setbacks for industry.*158 In 1977 the Supreme Court ruled that the liquor and firearms industries are narrow exceptions to the general rule that corporations are protected, under the fourth amendment, against warrantless regulatory searches. Marshall v. Barlow's Inc. *159 upheld a challenge to a provision of the Occupation Safety and Health Act (OSHA)*160 authorizing warrantless workplace inspections. At issue was whether an OSHA inspector needed a warrant to enter the premises of an Idaho electrical and plumbing corporation.*161

Marshall captures the political dynamic of corporate opposition to Modern Regulation. OSHA is the quintessential enactment of Modern Regulation; it was passed for social purposes and authorized an intrusive federal system of routinized inspections. Those filing amici curiae briefs on behalf of the federal government included the AFL-CIO and the Sierra Club, advocates of Modern Regulation. Those submitting amici curiae [*609] briefs in support of the corporation revealed the uniformity of company opposition: the Mountain States Legal Foundation and the Pacific Legal Foundation (both are law firms representing corporate interests), the National Federation of Independent Business, the American Conservative Union, and the Chamber of Commerce of the United States.*162

Marshall's far-reaching implications include rendering presumptively invalid many inspection provisions of federal statutes.*163 In dissent, Justice Stevens argued that the majority severely hampered the ability of government inspectors to conduct surprise inspections and to uncover workplace safety violations.*164 Marshall was more than simply a corporate triumph over Modern Regulation. It represented the protection of New Property -- information about workplace operations that the corporation sought to conceal from government -- and it demonstrated the importance of the intangible Bill of Rights in the modern political economy.

The business press registered this urgency. "The Supreme Court decision banning OSHA inspections without a search warrant is a great victory for privacy and freedom in this country," wrote the Personnel Director of Nikon corporation in a trade journal.*165 "In the long run, it may also be a blessing in disguise for OSHA if it results in diminishing the reputation OSHA established as being an antagonist to American business and emerges as its adjunct."*166 This recognition of Marshall as [*610] a triumph over Modern Regulation typified the corporate community's response,*167 and heralded an unprecedented recognition by the business press of the importance of the Bill of Rights.*168

After Marshall corporations continued to challenge the tools of Modern Regulation. In Donovan v. Dewey,*169 a mineral company disputed, on fourth amendment grounds, the warrantless inspection provisions of the Federal Mine Safety and Health Act of 1977.*170 Although the Court rejected the challenge, it did not overrule Marshall, but suggested that Congress' power over interstate commerce justified warrantless searches only in certain narrow cases such as liquor or firearms.*171

In 1986, in Dow Chemical Corp. v. United States,*172 corporations posed their most far-flung constitutional challenge to the Modern Regulation of Modern Property. Dow Chemical corporation argued that the fourth amendment should prohibit the Environmental Protection Agency from flying planes over Dow's manufacturing facilities to monitor compliance with the Clean Air Act.*173 Although the Court permitted [*611] the flights, it appeared to endorse Dow's expansive view of the Constitution. The Court opined that Dow plainly had a reasonable, legitimate, and objective expectation of privacy,*174 but found that Dow's facility was similar to "open fields" that are subject to public view and observation.*175 The taking of photographs, therefore, did not constitute a search.*176 Undoubtedly, the narrow grounds upon which the Court's decision rests will encourage further corporate challenges to the more sophisticated modes of Modern Regulation in defense of information, the most intangible form of Modern Property.

ii. The First Amendment

Corporations invoked the first as well as the fourth amendment to challenge Modern Regulation and safeguard Modern Property. In the late 1970s the Supreme Court conferred constitutional protections on two types of corporate speech: commercial and political. The importance of commercial speech in the modern political economy is evinced by corporations' legal actions and by the business press' defense of this form of communication. Political speech, as a means of influencing legislative economic decisions, and thwarting novel forms of regulation, also has assumed increased urgency for corporations.

The protection of "commercial speech" is a comparatively new constitutional phenomenon. Until the 1970s advertising was viewed as commercial speech, unprotected by the first amendment.*177 But in 1976, in [*612] Virginia Board of Pharmacy v. Virginia Citizens Consumer Council, Inc.,*178 the Court held unconstitutional a Virginia statute prohibiting price advertising of prescription drugs. A consumer group brought suit, contending that it had a right to receive price information. The Court found that commercial speech is not so far removed from the "exposition of ideas" that it should be denied first amendment protection, though of a lesser degree than "core" political speech. Because the consumer's interest in this information was held to outweigh the government's interest in protecting the pharmacists' expertise, the statute was struck down.

Soon after, corporations pressed for protection of commercial speech. They did so both to thwart government regulation and to defend a form of Modern Property: advertising. In 1980, in Central Hudson Gas & Electric Corp. v. Public Service Commission of New York,*179 the Court overturned a state regulation, adopted during the mid-1970s energy crises, banning all utility corporations from promoting the use of electricity in advertisements. The Court applied a balancing test -- used for lesser-protected commercial speech -- and found that because the overbroad ban covered advertising that promoted the purchase of more energy efficient appliances, it was broader than necessary to serve the state interest in energy conservation.*180

The Central Hudson Court acknowledged that communication, in the modern political economy, is a form of property. Commercial speech was defined as "expression related solely to the economic interests of the speaker and its audience."*181 In dissent, Justice Rehnquist protested that striking down state economic regulation was nothing more than a contemporary version of Lochner.*182 Indeed, Central Hudson was a Lochner-like invalidation of Modern Regulation: social regulation -- albeit [*613] conducted by state, not federal, government -- designed to achieve a national goal of energy independence.*183

If Rehnquist criticized Central Hudson as a modern version of substantive due process, the business community welcomed protection of commercial speech as a guarantor of property rights. The inviolability of this form of speech, like the opposition to government regulation, has become a unifying ideology of the corporate community. "We maintain that voices in a democratic society -- individual and corporate alike -- shouldn't be stifled or filtered through Big Nanny," opined a corporation-sponsored editorial defending unfettered commercial speech. "Whether the topic is cigarettes, or energy policy, or the latest in designer jeans, the first amendment shield must never be lowered, or selectively applied."*184

Undoubtedly commercial speech rights are more important to certain corporations and sectors of the economy: those industries -- such as consumer goods and retailing -- that count advertising and marketing as part of their product. But corporations from diverse sectors publicly advocate commercial free speech rights and view them as property rights.*185

The corporate legal literature now promotes commercial speech as a component of the bottom line, to be carefully monitored with an eye towards encroaching government regulation. Corporate managers are admonished to "run advertisements that are expected to raise profits (but should avoid false and misleading advertising because the FTC will fine them)."*186 The exercise of first amendment rights, in a commercial speech setting, becomes a property right, subject to cost-benefit calculations.

[*614] The importance of commercial speech rights to corporations is reflected in their aggressive assertion of those rights, often with adverse consequences for individuals. In 1987, Americans witnessed a fierce, and public, debate over corporate commercial speech rights when a bill was introduced in Congress to ban all forms of cigarette advertising.*187 Tobacco companies' subsequent efforts to oppose this legislation provoked a minor political furor. In late 1987, Phillip Morris Companies, Inc. mailed a press kit to a select group of newspaper and television editors. In it was a glossy black brochure. In deep red, on the cover, was a reproduction of the Order of Lenin, the highest honor conferred by the Soviet Union, and the words: "One world-famous newspaper without cigarette advertising."*188 Inside was a copy of Pravda. Kansas Representative Mike Synar, a sponsor of the antismoking legislation, later accused Philip Morris of "using the basest, grossest form of redbaiting to protect their multibillion-dollar investment, which costs young people their health and older Americans their lives."*189

That a tobacco corporation would engage in such aggressive tactics to support its commercial free speech rights is indicative of the importance of these rights have in the modern political economy. But the invocation of corporate commercial free speech rights presents two problems for individuals. First, as the Philip Morris example illustrates, the assertion of corporate rights can sometimes involve what Representative Synar calls "redbaiting," or a certain measure of intimidation directed at individuals who favor restricting corporate commercial speech. Second, the assertion of corporate commercial speech rights deprives the individual of a certain kind of freedom -- the freedom to be protected from tobacco and tobacco advertising.*190

[*615] In this way, the corporation's invocation of the Bill of Rights to protect Modern Property (the ability to advertise) and to thwart Modern Regulation (federal measures to protect health and the environment) impinges on individual liberties.

Corporations wield first amendment protections of political, as well as commercial speech, to derail government regulation. The Court initially conferred first amendment political speech safeguards on corporations in 1978 in First National Bank of Boston v. Bellotti.*191 In that case, a consortium of Boston corporations*192 raised a first amendment challenge to a Massachusetts statute prohibiting corporate expenditures on a graduated income tax referendum.*193 The Massachusetts Legislature and the Massachusetts Supreme Judicial Court concluded that the tax question did not materially affect the property, business, or assets of the corporations.*194 Nonetheless, the Supreme Court struck down the statute, holding that corporate political speech is protected.*195

Bellotti's corporate plaintiffs maintained that a graduated personal income tax would have a direct economic effect on them (by promoting a tax climate unfavorable to business or discouraging managers from moving to Massachusetts). *196 The corporate community applauded the "landmark"*197 decision as much for its economic as for its political content. "[P]rudence [*616] dictates a careful eye on gross revenues and net earnings," wrote a leading corporate spokesman, analyzing Bellotti for managers.

In addition, common sense dictates some correlation between money spent and the importance of the particular issue to the company's immediate business goals. It goes without saying that management is likely to spend far more to defeat legislation that would hinder its industry than it would to advocate a law with relatively minor business repercussions.*198

In the modern political economy, the ability to spend money to influence referenda is a form of Modern Property. As the advice for corporate managers suggests, it is frequently in the corporation's interest to spend money for political purposes. The right to spend this money is therefore an important property right to be guarded.

Bellotti was as much a frustration of Modern Regulation as a defense of Modern Property. The regulation was modern in the sense that state regulation of corporate spending in referenda is a comparatively new phenomenon*199 compared to prohibitions against corporate expenditures on election of candidates, which date back to the Progressive era.*200

[*617] The degree to which intangible, highly abstract first amendment rights become central in corporate economic calculations became apparent in 1986. In Pacific Gas & Electric v. Public Utilities Commission,*201 a public utility monopoly disputed a state regulation allowing a ratepayer advocacy group to enclose inserts in the utility's billing envelopes; the regulation's stated purpose was to allow for the dissemination of competing viewpoints and thus to lower utility rates. The Court ruled that the regulation violated the first amendment, as incorporated through the fourteenth, because it infringed the corporation's right not to associate with speech it opposed.*202

This freedom of association right is a form of Modern Property. In his concurring opinion, Justice Marshall indicated that a corporation has a property interest in the extra space in its billing envelope.*203 Indeed, the Commission shared this view, suggesting that this property belonged to ratepayers.*204 The development of extra space in an envelope as an important property right is symbolic of the evolution of property in post-industrial society;*205 the corporate assertion of first amendment rights to protect this Modern Property suggests the stakes involved.

Pacific Gas & Electric represented a victory for corporations over a novel form of regulation. The ratepayer advocacy group seeking access to the utility billing envelopes was an elected citizens group whose mission was to challenge electric rates on behalf of consumers. Established in several states, these groups attempted to create a decentralized, participatory form of regulation operating independently of government and deriving monetary support directly from the citizenry. In theory, this form of participatory or populist regulation should be less susceptible to capture than a state or federal regulatory apparatus. But Pacific Gas & Electric eliminated the groups' funding and communications capabilities, perhaps permanently ending this regulatory experiment.

Corporations, encouraged by the legal community, plan further first amendment assaults on a multiplicity of government regulations. At a 1987 judicial conference in Hershey, Pennsylvania, corporate lawyers counseled corporations to use the first amendment to invalidate a range of federal regulations, including Securities and Exchange Commission [*618] disclosure requirements governing corporate takeovers and rules affecting stock offerings.*206

iii. The Fifth Amendment

The use of the fifth amendment is the most striking example of how corporations invoke Bill of Rights protections to protect Modern Property in the form of government largess. After Hale,*207 the Court did not consider whether corporations enjoyed fifth amendment protections until the 1960s. *208 At that time, it reviewed the applicability of the double jeopardy clause to a corporation.*209

In Fong Foo, a corporation and two of its employees were tried on charges of concealing material facts in connection with a million dollar contract to furnish radiosondes (weather gathering devices) to the government. The district court judge directed a verdict of acquittal, citing improper conduct by the prosecuting attorney. The Supreme Court held that the double jeopardy clause barred retrial of the defendants, including the corporation.*210 The company successfully invoked its right to safeguard its government largess, a government contract.

In 1980, a federal court ruled that corporations have liberty interests protected by the fifth amendment due process clause. In Old Dominion Dairy Products, Inc. v. Secretary of Defense,*211 a corporation challenged the Defense Department's determination that it was barred from supplying dairy products to the Armed Services because an audit revealed that Old Dominion was an "irresponsible" contractor lacking "business integrity."*212 The [*619] D.C. Court of Appeals ruled that the Department violated the corporation's liberty interest in its reputation.*213 The court relied on earlier cases that held corporations have fourteenth and first amendment liberty rights. *214

Old Dominion is further indication that the Bill of Rights can be used by corporations to protect Modern Property. The award of military contracts is largess -- considered a form of Modern Property because it is created by the federal government.*215

[*620] The willingness of corporations to assert first, fourth, and fifth amendment claims derives from the increased importance of the Bill of Rights in the modern political economy. Because much of Modern Regulation is conducted by federal government, the Bill of Rights is implicated rather than the fourteenth amendment, as in the era of substantive due process. Modern federal regulation -- conducted for environmental, social, or consumer purposes -- often involves intrusive inspections that trigger fourth amendment concerns.

Modern Property often takes the form of government largess, and corporations invoke the fifth amendment to protect it. The ability to advertise commercially, or to participate in political referenda that affect the corporate environment, are increasingly important forms of Modern Property; corporations assert the first amendment to protect it.

Taken together, these Bill of Rights assertions represent a bold new challenge to government regulation. Denied the power of the fourteenth amendment when the era of substantive due process ended, corporations have taken refuge in the Bill of Rights.

In the process, substantive due process may have been revived. When the Supreme Court pronounces on the nature of the corporation (for constitutional purposes) it imposes its own economic views, as it did during the substantive due process era. The question: What is the nature of the corporation? is similar to the economic questions that the Supreme Court was criticized for asking in the Lochner era. In fact, theorizing about the nature of the corporation ends up as an inquiry into the propriety of regulation.

To determine the extent to which substantive due process has been revived for the corporation, one must consider the history of corporate theory and the Bill of Rights.

II. The Demise of Corporate Theory

In the era of Modern Regulation, the rise of the application of the Bill of Rights to corporations has coincided with the demise of corporate theory. Before 1960, the Court only considered corporations' constitutional guarantees within the strictures of corporate personhood theory: a corporation was either an "artificial" entity subject to expansive state regulation or a "natural" entity entitled to constitutional protections against the state. After 1960, the Court abandoned theorizing about corporate personhood.

[*621] In some respects, this drastic doctrinal reversal is extraordinary, especially considering the frequency with which corporate constitutional rights are now asserted. Without some theory of corporate personhood, it is unclear how corporations can claim the succor of Bill of Rights amendments written only for "persons."*216

In other respects, the Court's modern, pragmatic, antitheoretical approach is the prosaic legitimation of the corporation's constitutional status. This pragmatic approach is a less controversial guarantor of corporate rights than a theoretical methodology that raises fundamental questions about the nature of a corporation and its role in society. The Court retreated to pragmatism in response to criticisms of corporate personhood theory -- by Legal Realists and economists -- and out of a concern for its own legitimacy to decide economic questions (including the ultimate question: What is a corporation?) in the post- Lochner era.

A. The Progressive and New Deal Periods: Personhood Theory

The Supreme Court only occasionally considered corporate protections under the Bill of Rights prior to 1960. When it did, it invoked a theory of corporate personhood. Fifth amendment privileges against self-incrimination were denied the corporation, because artificial entities subject to state regulation (defined to include federal superintendence) cannot invoke constitutional rights. Although the Court initially employed the natural entity theory to confer fourth amendment privileges on corporations, it later used the artificial entity theory to narrow those rights. This pattern was repeated in the first amendment area.

(1) The Fifth Amendment: Artificial Entities

Corporations were first "personalized" in Santa Clara, and by 1910 the Court accepted the natural entity theory for fourteenth amendment purposes.*217 While in Noble the Court never explained its reasons for conferring fifth amendment due process property rights on corporations, the logic of the natural entity theory appeared to govern.

Intangible Bill of Rights protections were another matter. Their applicability to corporations was first considered in 1906 in Hale,*218 which marked the beginning of the Court's schizophrenic view of corporate personality.*219 The Court utilized the artificial entity theory to deny corporations [*622] fifth amendment privileges against self-incrimination, *220 while embracing the natural entity theory to grant corporations fourth amendment safeguards.*221

The reasons for Hale's two-faced view of the corporation remain mysterious. The opinion may have reflected the growing debate in the legal literature over corporate personality. It may be that although the Court viewed the fourth amendment protection of papers to be akin to the protection of property, the very personal, intangible privilege against self-incrimination is more difficult to grant a corporate entity. One commentator suggests the opinion represents a savvy accommodation to old style regulation because if both fourth and fifth amendment protections were granted corporations, prosecution under the Sherman Act would be impossible.*222

Whatever the reasons, Hale marked the beginning of a period in which the Court viewed corporate Bill of Rights guarantees exclusively in terms of personhood theory; Morton Salt,*223 decided in 1950, marks the end of that period.

Hale involved a criminal antitrust action, brought under the Sherman Act, against two tobacco corporations: the American Tobacco Company and the MacAndrews & Forbes Company. A subpoena duces tecum was issued to Hale, the secretary and treasurer of MacAndrews & Forbes, requesting that he appear and produce a battery of letters and contracts executed between his corporation and several other tobacco [*623] firms.*224 Hale refused to comply, invoking the fifth amendment's privilege against self-incrimination.*225

Rejecting this argument, the Court held that the words "no person" in the privileges portion of the fifth amendment do not suggest that corporations should be included within the amendment's protections.*226 The majority then rendered its most expansive rendition of the artificial entity theory,*227 drawing a sharp distinction between the individual and the corporation.*228 The individual exists antecedent to the state and therefore owes no duty to the state and cannot be deprived of any constitutional rights. The corporation, however, is a mere "creature of the State." Its powers are limited by law, and the legislature reserves a right to investigate the corporation.*229 An individual may refuse to answer incriminating questions, but a corporation may not if it is charged with an abuse of its state-conferred privileges.*230

Hale, for the first time, modified the artificial entity theory to include the federal government. Since the defendant tobacco corporation was incorporated in New Jersey, the artificial entity theory, strictly applied, would only permit a state government to exercise its visitorial powers over the corporation. The Hale Court ruled, however, that because the defendant corporation is subordinate to Congressional power over interstate commerce, it is subject to dual sovereignty, and the federal [*624] government has the same right to inspect corporate documents as the State of New Jersey.*231

Since Hale, the privilege against self-incrimination remains the only Bill of Rights safeguard unavailable to corporations; its reasoning survives as a relic of a bygone era of corporate theory.*232 Paradoxically, in modern times, corporations receive other fifth amendment protections: due process liberty rights and double jeopardy safeguards.

(2) The Fourth Amendment: Artificial v. Natural

Although Hale settled the personhood debate for the fifth amendment privilege against self-incrimination, it merely began it for the fourth amendment. In Hale, the Court raised the question, on its own, whether a corporation is entitled to fourth amendment protections. The Court held that corporations are entitled to such protection.

[W]e do not wish to be understood as holding that a corporation is not entitled to immunity, under the fourth amendment, against unreasonable searches and seizures. A corporation is, after all, but an association of individuals under an assumed name and with a distinct legal entity. In organizing itself as a collective body it waives no constitutional immunities appropriate to such a body.*233

By suggesting that a corporation is a distinct legal entity, the Court for the first time explicitly adopted the "natural entity" theory of the corporation. There was no doubt about the utilitarian reasons for doing so: "corporations [*625] are a necessary feature of modern business activity, and their aggregated capital has become the source of nearly all great enterprises."*234 The Court went on to hold that an overbroad subpoena for corporate documents constitutes an "unreasonable" search.*235

In a separate concurrence in Hale, Justice Harlan advanced the artificial entity theory to suggest that corporations should not be accorded fourth amendment protections.

In my opinion a corporation -- "an artificial being, invisible, intangible, and existing only in contemplation of law" -- cannot claim the immunity given by the fourth amendment, for it is not a part of the "People," within the meaning of that amendment. Nor is it embraced by the word "persons" in the amendment. *236

After the New Deal, the artificial entity theory worked its way back into fourth amendment jurisprudence as a way of narrowly circumscribing the corporation's fourth amendment rights.*237 This was first done in [*626] Oklahoma Press Publishing Co. v. Walling,*238 in which the Court permitted the Department of Labor broad access to a newspaper corporations documents.

Historically private corporations have been subject to broad visitorial power, both in England and in this country. And it long has been established that Congress may exercise wide investigative power over them, analogous to the visitorial power of the incorporating state, when their activities take place within or affect interstate commerce.*239

Furthermore, the Court found that corporations are not entitled to all of the constitutional protections individuals have "in these and related matters." *240

In United States v. Morton Salt Co.,*241 the Court relied on a federal version of the artificial entity theory to permit the FTC broad authority to inspect a corporation's price lists. "[C]orporations can claim no equality with individuals in the enjoyment of a right to privacy . . . . They are endowed with public attributes. They have a collective impact upon society, from which they derive the privilege of acting as artificial entities," held the Court. "The Federal Government allows them the privilege of engaging in interstate commerce. Favors from government often carry with them an enhanced measure of regulation."*242

The Court championed, and then abandoned, corporate theory. From Hale to Morton Salt, the Court framed the question of whether a search for corporate documents is reasonable in terms of corporate personality: to the extent the corporation was an artificial entity, subservient to the state, the federal government could make broad requests for the production of corporate documents. *243 The Court moved from the natural entity theory in Hale, which placed limitations on the federal governments' investigatory powers, to a federal version of the artificial [*627] entity theory in Morton Salt that allowed the government seemingly unlimited powers to inspect corporate documents for no other reason than "official curiosity." This shift may have reflected the increased legitimacy of federal regulation in the New Deal era. Whatever the reasons, during this period the Court always decided the question of a corporation's constitutional guarantees based on a corporate personhood theory.

(3) The First Amendment: Artificial v. Natural

Although corporations first received first amendment safeguards in 1978, *244 by that time the Court had considered the first amendment protections of unincorporated associations, newspaper corporations, labor unions, and other organizations. Although these cases have little precedential value for profit-making corporations, corporate theory worked its way into these decisions before and immediately after the New Deal.

First amendment rights were initially extended to a newspaper corporation in 1936. In Grosjean v. American Press Co.,*245 the Court ruled that a newspaper corporation has a first amendment liberty right to freedom of speech that would be applied to the states through the due process clause of the fourteenth amendment. In Grosjean, incorporated Louisiana publishers sued to enjoin enforcement of a state tax imposed on businesses selling advertising space in their publications. The corporations claimed that the tax infringed upon their right to freedom of the press under the first amendment.

The Court relied on precedents holding that corporations are "persons" for fourteenth amendment purposes, under the natural entity theory, and suggested that "the word 'liberty' . . . embraces not only the right of a person to be free from physical restraint, but the right to be free in the enjoyment of all his faculties as well."*246 On this reasoning a corporation should be free to sell advertisements without interference by the state. The holding may have little precedential value for private corporations, however, because the press -- which is specifically mentioned in the first amendment -- has a greater claim to constitutional protections than do other corporations.

Grosjean, however, ignored a 1906 opinion employing the artificial entity theory to specifically deny corporations fourteenth amendment liberty rights. In Northwestern National Life Insurance Co. v. Riggs,*247 an estate sued an insurance corporation that refused to honor certain policies [*628] due to alleged misrepresentation. A Missouri statute prohibited the use of the misrepresentation defense. The corporation charged that the statute deprived it of liberty and property rights without due process. Although the Court conceded that liberty included the right to pursue lawful claims and enter contracts, it ruled that corporations cannot enjoy this liberty right because "[t]he liberty referred to in . . . [the fourteenth] amendment is the liberty of natural, not artificial persons."*248 The tension between the artificial entity theory employed in Riggs and the natural entity theory of Grosjean was similar to fourth amendment tensions over the corporate soul.*249

During this period the Court used the same mode of analysis to decide first and fourth amendment cases: to the extent a corporation was considered an artificial entity, it could be denied constitutional protections; to the extent it was considered a natural entity, it was granted safeguards.

Three years after Grosjean, the Court adopted the Riggs artificial entity analysis to deny an incorporated labor union first amendment rights. In Hague v. CIO,*250 Justice Stone noted in his concurring opinion that "[a corporation] cannot be said to be deprived of the civil rights of freedom of speech and of assembly, for the liberty guaranteed by the due process clause is the liberty of natural, not artificial persons."*251 Hague invalidated a Jersey City ordinance prohibiting individuals, labor associations, and the American Civil Liberties Union (ACLU) from distributing [*629] literature. Only the individual plaintiffs, not the labor union or the ACLU, could invoke first amendment protections.

Just as Morton Salt largely deprived corporations of fourth amendment privacy rights in 1950, so Hague deprived at least one form of corporate entity free speech rights in 1939. And as Morton Salt had marked the end of Supreme Court theorizing about corporate personality in the fourth amendment context, so Hague was the final attempt to formulate a theory in the first amendment context. *252

B. The Modern Period: The Demise of Corporate Theory

As the Bill of Rights became important to the corporation in the period of Modern Regulation and Modern Property, the Court jettisoned theories of corporate personhood. Frequently the Court looked to the history of the amendment in question to justify corporate rights, as in the case of the fourth amendment; occasionally the Court examined the underlying purposes of an amendment, as in its handling of the first amendment; and sometimes the Court conferred Bill of Rights protections on corporations with no explanation, as with the fifth, sixth, and seventh amendments.

(1) The Fourth Amendment: Commercial Property

In the period of Modern Regulation and Modern Property the Court discarded theories of corporate personality for a mode of analysis concerned with the historical purposes of the fourth amendment. The old categories of artificial entity versus natural entity theories of the corporation were not applied in the context of intangible rights exercised against the modern regulatory state. Instead the Court focused on privacy interests in "commercial property": theories of property, implied consent, and the history of the fourth amendment " warrant" clause came into play.

The See v. City of Seattle*253 decision, which held unconstitutional the Seattle fire inspection system, inaugurated the move away from personhood [*630] theory.*254 In that case, instead, the Court focused on the fourth amendment protections to which "commercial premises" and "business enterprises" -- corporate or otherwise -- are entitled. Although See relied on the line of cases from Hale to Morton Salt,*255 the Court ignored the competing theories of the corporation developed therein. Rather, it analogized official entries upon commercial property to administrative subpoenas and held that it is untenable for subpoenas to be subject to fourth amendment limitations that are inapplicable to actual searches and inspections of "commercial premises." *256

In Colonnade Catering Corp. v. United States,*257 the Court created a narrow exception to See's warrant requirement based on the history of the fourth amendment and Congress' historic power over the liquor industry.*258 The Court never broached the question of corporate personality, and confined its analysis to what extent "private commercial property" has a right to privacy. *259 In United States v. Biswell,*260 the Court held that the firearms industry was exempt from a warrant requirement [*631] on a theory of implied consent. The Court reasoned that anyone entering that kind of business "does so with the knowledge that his business records, firearms, and ammunition will be subject to effective inspection."*261

In Marshall v. Barlow,*262 the Court's most consequential fourth amendment decision, it struck down OSHA surprise inspection systems, using yet another mode of analysis. No longer did it employ a theory of implied consent, or pervasive regulation; instead, it employed the warrant clause of the fourth amendment,*263 suggesting that the clause applied to "commercial buildings" as well as private homes.*264 The history of this clause suggests that it protected merchants in the colonies immediately preceding the Revolution. In Marshall, the Court rejected the Secretary of Labor's artificial entity argument that the federal government can regulate any corporation involved in interstate commerce without regard to fourth amendment protections.*265 The Court easily could have adopted the artificial entity analysis of Morton Salt to circumscribe narrowly corporate rights, but chose not to do so.

The Court subsequently created narrow exceptions*266 to the See and Marshall warrant requirements using arguments about privacy rights [*632] that attach to commercial property;*267 theories of corporate personality from the Morton Salt and Hale era never re-emerged, even in dissent.

The Court's extraordinary shift in analytic paradigms may partly reflect the novel problems presented by Modern Regulation. The privacy issues arising from this form of government supervision were not raised by earlier requests for corporate "papers" that could be considered purely a request for property.

Another possible reason for the Court's shift in analytic paradigms may be that the Court's concept of the fourth amendment had changed. In the 1960s, the fourth amendment was construed to protect privacy rights, not property rights. *268 The theory of the corporation, however, [*633] could not readily accommodate itself to this analysis. Instead, the Court developed concepts of implied consent and commercial property as imperfect mechanisms for granting corporations privacy rights against regulatory searches.

But the rejection of corporate theory in the context of other Bill of Rights amendments suggests that deeper forces were at work than simply an accommodation to fourth amendment privacy theory.

(2) The First Amendment: Serving the Free Market

While the Court abandoned corporate theory for a collection of fourth amendment paradigms, in the first amendment context it supplanted personhood theory with a single notion: the free market of ideas. In both the political speech and the commercial speech context the question became not whether the party asserting the right (a corporation) was entitled to free speech protections, but whether assertion of the right furthered free and open debate.

In Bellotti,*269 the Court wasted no time disapproving corporate theory. Relying in part on Riggs and Hague, the Massachusetts Supreme Court had employed the artificial entity theory to hold that individuals enjoy broader first amendment protections than corporations, which can claim only fourteenth amendment property protections.*270 The majority of the Supreme Court dismissed this reasoning as "an artificial mode of analysis"*271 and radically changed the terms of the debate:

The Court below framed the principal question in this case as whether and to what extent corporations have first amendment rights. We believe that the Court posed the wrong question. The Constitution often protects interests broader than those of the party seeking their vindication. The first amendment, in particular, serves significant societal interests. The proper question therefore is not whether corporations "have" first amendment rights, and if so, whether they are coextensive with those of natural persons. Instead, the question must be whether [the statute] abridges expression that the first amendment was meant to protect. We hold that it does . . . .*272

[*634] The Court applied the same logic in according corporations their most expansive first amendment guarantees: the right not to speak or be associated with speech of others. Pacific Gas & Electric*273 overturned a state regulation allowing a ratepayer advocacy group to enclose inserts in a public utility monopoly billing envelope. The plurality's reasoning followed Bellotti, noting that corporations are no less able than other speakers to contribute to the "discussion, debate, and dissemination of ideas that the first amendment seeks to foster."*274 For the state to force a corporation to carry a particular message would alter what listeners hear, in effect distorting the free market of ideas.*275

The free market concept that originated in the political speech arena also governs commercial speech decisions. Central Hudson Gas & Electric Corp. v. Public Service Commission of New York*276 for the first time extended commercial speech protections to corporations by holding that a state regulation banning all promotional advertising by electric utilities violated the first amendment. Relying on Bellotti, the majority found that the paramount right of the consumer to hear overshadowed any question about the right of the speaker to speak.*277 In so pronouncing, the Court abandoned corporate theory in the commercial speech context as it had in the political speech context.

The Court's forceful rejection of corporate theory in the modern era is matched by its equally ardent assertion that corporations' constitutional guarantees depend on the nature and purpose of the particular constitutional provision.*278 If the purpose of the first amendment is to promote a free market of ideas, all other considerations are subordinate.*279 Although this view legitimates the invocation of corporate Bill of Rights protections, it begs the question of how corporations can assert any rights to begin with.

(3) The Fifth Amendment: In Search of a Theory

If the corporation's constitutional rights depend on the underlying purpose of an amendment, the Court has yet to explain how the goals of [*635] the fifth amendment are served by application to corporations. In the modern era the Court extended double jeopardy protections to corporations without a trace of an explanation. Lower courts have bestowed fifth amendment guarantees without any reasoning.*280

In Fong Foo v. United States,*281 the Supreme Court held, without explanation, that the double jeopardy clause barred retrial of the defendants, including the corporation, on charges of concealing material facts from the government.*282 Similarly, in United States v. Martin Linen Supply Co., *283 the Court held that the fifth amendment bars retrial of a textile corporation acquitted, under the federal rules of criminal procedure, of violating an antitrust consent decree. While citing Fong Foo, the Court did not indicate why corporations, in particular, can avail themselves of fifth amendment protections. Instead, the case was decided by taking "a closer look at the policies underlying the [double jeopardy] Clause."*284 Though the clause's purpose is to mitigate individual suffering, the Court had no problem applying it to a corporate defendant. The clause bars repeated attempts to convict the accused, "thereby subjecting him to embarrassment, expense and ordeal and compelling him to live in a continuing state of anxiety and insecurity, as well as enhancing the possibility that even though innocent he may be found guilty."*285

Although the ascription of intensely human feelings -- guilt, embarrassment, anxiety, and insecurity -- seems forced when applied to the corporation, the holding stands. The failure of the Court to broach issues of corporate personality when analyzing the double jeopardy clause in the [*636] 1970s, *286 contrasts with its theorizing about the self-incrimination clause at the turn of the century.*287

[*637] (4) Corporate Theory: Critical of Corporate Rights

But corporate theory has not completely died as a constitutional mode of analysis. Abandoned by the Court's majority,*288 corporate theory survives in powerful dissents by Justice Rehnquist and in a recent lower court opinion. The reemergence of the artificial entity theory serves as a haunting critique of the Court's disaggregated approach to corporate rights.

Corporate theory made its modern debut in Justice Rehnquist's Bellotti dissent. Carrying the banner of the artificial entity theory, Rehnquist argued that Grosjean and NAACP, relied on by the majority, were limited exceptions to the Riggs*289 artificial entity theory. Rehnquist characterized the corporation as nothing more than an artificial creature of the state, guaranteed property rights implicitly by its charter. The political activities of corporations, however, are not so protected, and in fact pose great dangers. Therefore, the corporation has no liberty right to engage in political activity.*290 Rehnquist also dissented from the majority's [*638] opinion in Central Hudson that corporations enjoy commercial speech protections.*291 In his dissent he noted that corporations -- especially utility monopolies -- are chartered by the state, and subject to enhanced supervision.*292

At least one district court has chosen to recognize corporate theory in the modern period. In Michigan State Chamber of Commerce v. Austin,*293 a district court rejected a chamber of commerce first amendment challenge to a state criminal statute proscribing corporate spending on political candidates. Relying, in part, on Morton Salt and the artificial entity theory, the court held that corporations enjoy lesser first amendment protections than individuals.*294 The court argued that "favors from government often carry with them an enhanced measure of regulation."*295

The Michigan legislature has granted corporations the advantages of perpetual life, limited liability, and wide-ranging powers to encourage economic expansion and prosperity [and] such advantages allow corporations to amass great aggregations of capital and influence. In the economic sphere such power is proper and often highly beneficial to the general welfare of our society. In the political sphere, however, such power coupled with the faceless nature of corporations may very well create an atmosphere of distrust or the appearance of corruption in the electoral process.*296

The district court's invocation of corporate theory and fourth amendment cases in the first amendment context is instructive. First, it [*639] indicates that cases valid for one amendment are meaningful precedents for other amendments. Second, it suggests the necessity of creating a uniform theory of the corporation for all the Bill of Rights amendments, as distinct from the current disaggregated approach.*297 To do this requires an understanding of the demise of corporate theory.

C. From Theory to Pragmatism

Why has the Court abandoned corporate theory in the period of Modern Regulation, precisely when the Bill of Rights became so important to the corporation? Important challenges to traditional corporate theory, posed by Legal Realists and economists, undoubtedly influenced the Court. Simultaneously, the invocation by corporations of more intangible rights -- of association, privacy, and speech -- in response to Modern Regulation, and in defense of Modern Property, severely strained the argument that corporations are "persons." Moreover, the need to legitimize the judicial creation of new constitutional persons underlies the Court's pragmatic, antitheoretical approach.

(1) The Realist and Institutionalist Legacy

The powerful, corrosive critiques of the Legal Realists expedited the demise of corporate theory. As part of their attack on "conceptualism" and abstract legal reasoning,*298 the Realists forcefully challenged the validity of corporate theory. John Dewey powerfully undermined corporate theory in a 1926 Yale Law Journal article concluding that "each theory" of group personality "has been used to serve . . . opposing [*640] ends."*299 The Realists's critiques wound down the voluminous, pointed intellectual debate over corporate personality that arose on the continent and in America at the turn of the century.*300

But the Realists' forceful attack on corporate theory as an infinitely manipulable doctrine cannot explain fully its demise. After all, the Supreme Court relied on corporate theory at least until the Morton Salt decision in 1950, long after Dewey's critique. Moreover, the Court's very use of corporate personhood theory to decide Bill of Rights cases, as in Hale and Morton Salt, belies Dewey's claims: there is a perfect correlation between the invocation of the artificial entity theory and the denial of corporate rights. Similarly, there is a perfect correlation between the invocation of the natural entity theory, as in Hale and Grosjean, and the conferral of corporate rights. In the particular context of the corporation's Bill of Rights, the choice of a corporate theory had important consequences.

Economists, as well as lawyers, challenged theories of corporate personality in the New Deal era. In the 1930s a group of thinkers -- called Institutionalists -- began to conceive of corporations as social institutions rather than as a unified group of shareholders. Led by Adolph Berle, Gardiner Means, and Rexford Tugwell, the Institutionalists advanced the idea of corporations as competing interests rather than as artificial creatures or bodies endowed with a collective will.*301 The institutionalist thesis that under shareholder capitalism the separation of ownership and control places the interests of a managerial class above that of shareholders or workers, undoubtedly subverted corporate theory. The concept of a power struggle within a corporate body undermines the notion of a collective will implicit in the natural entity theory while raising the question of for whom, and for what interests, a corporation is chartered.

[*641] (2) Current Crises in Corporate Theory

Recent work in economics and organizational studies also subverts traditional corporate theory. This work reflects profound changes in the internal structure of the firm and in the American and world economies.

In the late nineteenth and early twentieth centuries few challenged the corporation as the essential engine of economic growth; the corporation was the organic building block of free market capitalism. Not so today. A changing world economy and the rise of the modern regulatory state provoked a profound debate about the nature of the corporation and its role in society. After a period of quiescence -- from roughly the end of World War II to the 1960s -- the central institution of contemporary society was challenged in multidimensional ways.

As late as 1959 the corporate form stood unquestioned. "In reviewing the literature about the current development of [the large, publicly-held] corporations, and about possible programs for their reform, one is struck by the atmosphere of relative peace," wrote political scientist Eugene Rostow. "There seems to be no general conviction abroad that reform is needed. The vehement feelings of the early thirties, expressing a sense of betrayal and frustration at a depression blamed on twelve years of business leadership, are almost entirely absent."*302 In the years of post-war prosperity, led by the export of American managerial expertise, the corporation, like the concept of free trade, enjoyed renewed legitimacy.*303

In the 1960s and 1970s the rise of the environmental, consumer, and public interest movements challenged unfettered growth and questioned accepted notions of the corporate form. A "social responsibility" school of thought argued that a corporation serves many constituencies: workers, consumers, and community members.*304

The takeover economy of the 1980s put further pressure on corporate theory. Corporate managers, responding to merger threats, appeal to states to pass antitakeover statutes. In so doing, ironically, they make a social responsibility-like argument that corporations are comprised of stakeholders: workers, consumers, and family members.*305

[*642] But America has become an economy of triadic elites: traditional elites (managers) are joined by takeover elites (investment bankers, lawyers, and raiders) and shareholder elites (pension fund managers). Each has a different view of the corporation. The traditional manager, to justify state protection, suggests the corporation serves stakeholders; the pension fund manager argues that companies serve shareholders only, but is sometimes willing to take a long-term view of shareholder interests; takeover elites suggest the corporation should only serve the short-term interests of shareholders, even if this means breaking up the corporation.

A changing world economy -- in which the American firm is no longer predominant -- also threatens corporate theory. The very ability of American corporations to prevail against international competition has provoked calls for protectionism, industrial policy, and suggestions that the corporation serve some national good.*306 Within this new economy, corporate theorists believe the corporation is already undergoing a radical transformation.*307 Other societies are also reconsidering the goals and purposes of the corporate form. *308

Economic changes are reflected in the organizational and economic literature of the firm. Building on the work of Berle and Means, modern organizational management theory regards the corporation as a coalition of competing interests and claims, all bargaining with one another.*309 The structure of this organization then becomes depersonalized, in the sense that it has no clear authority and does not act as one individual.*310

The modern study of institutions resonates in economics. Contemporary economists challenge the traditional notion of a corporation as simply a profit maximizing enterprise. The corporation, rather, is torn [*643] by contradictory motivations and interests, including the self-serving programs of corporate officers. Instead of pursuing the optimal, textbook goal, of increasing share value, the modern firm often sets different goals, including increased sales volumes, management returns, market share, stability, or growth.*311

An irony of the modern political economy is that the notions of material prosperity and the free market remain unchallenged while the central institution of that prosperity is undergoing a crises of legitimacy.*312 Traditional notions of corporate personhood have little relevance in this climate; the natural entity theory -- or the view of the corporation as a person -- contains little residual meaning.

To the extent the corporation is perceived as having different goals, and competing constituencies, the corporation does not act like a "person" with a singular purpose.

(3) Intangible Rights: The Strain on Personhood

Fact as well as theory has strained traditional notions of corporate personhood. The facts of the constitutional challenges brought by corporations in the period of Modern Regulation have made it increasingly difficult for the Court to maintain that corporations are "persons." These challenges required the Court to rule that corporations are akin to persons in increasingly improbable respects: that corporations enjoy some "privacy" that can be invaded by regulatory searches, or suffer the indignities of a second criminal trial, or the forced association with another's speech. As the metaphor of corporations as persons became increasingly strained, the Court abandoned corporate theory in favor of [*644] notions about commercial property, the free market of ideas, and the historical purposes of each amendment.

The problem posed for the personhood theory by intangible rights asserted in the modern political economy is most strikingly evident in Pacific Gas & Electric. The Court's conferral of negative free speech rights on corporations hastened Justice Rehnquist to scorn the plurality for refusing to face up to the constitutional status of the corporate person.

Extension of the individual's freedom of conscience decisions to business corporations strains the rationale of those cases beyond the breaking point. To ascribe to such artificial entities an 'intellect' or 'mind' for freedom of conscience purposes is to confuse metaphor with reality. . . . The insistence on treating identically for constitutional purposes entities that are demonstrably different is as great a jurisprudential sin as treating differently those entities which are the same.*313

In the nineteenth century, however, the metaphor of corporations as "persons" -- capable of holding property under the fourteenth amendment -- was not entirely improbable. The concept of an organization holding tangible property and asserting tangible rights did not strain the imagination. It is entirely plausible that a group of people could band together to hold property jointly. It is less plausible that the same group can speak with one voice or have a singular privacy interest.

And even when corporations first began asserting intangible rights -- in 1906 in Hale -- the dissonance between fact and theory was not as significant. In Hale, for example, the Court granted fourth amendment rights to corporations to protect what is arguably a form of property: corporate papers.

But the more intangible the right, the more striking the difference between a corporation and a person, and the more difficult it becomes for the Court to treat corporations as persons. Consider, for example, the fourth amendment. For corporations to assert fourth amendment rights against warrantless regulatory inspections requires according corporate persons the very intangible right of privacy. In return, this requires a double constitutional leap. First, the Court must decide that corporations are persons. Second, the Court must decide that a privacy right of a corporate person has been violated. Even assuming that the Court employs the natural entity theory to hold that corporations are persons, the second prong of this analysis presents difficulties; how a corporation enjoys a privacy interest in its premises remains unclear.

[*645] Even the natural entity theory has difficulty explaining corporations as persons for purposes of these rights. To circumvent the obvious differences between people and corporations in awarding intangible rights, the Court attempts to reformulate the right to privacy, free from regulatory inspections, as a property right attaching to commercial premises.

The problem is no less acute in the first amendment context, where a corporate person is granted a freedom not to associate, or in the fifth amendment arena, where corporate bodies are accorded "liberty" interests or suffer indignities or embarrassment from retrial. The response of the Court to the metaphorical problems posed by the corporate invocation of intangible rights was to either accord constitutional rights to corporations sub silentio, and without theoretical basis, (fifth amendment) or justify the conferral or corporate rights based on an appeal to the free market of ideas (first amendment).

(4) Judicial Legitimacy: The Specter of Lochner

More than the problems of personhood metaphors, concerns about judicial legitimacy explain the demise of corporate theory. The bestowal of constitutional rights on corporations, via the natural entity theory, raises the specter of Lochner.

The Court admits its concern with avoiding the errors of the Lochner era. "[The Court] is most vulnerable and comes nearest to illegitimacy when it deals with judge-made constitutional law having little or no cognizable roots in the language or design of the Constitution," wrote the majority in a recent opinion. "[T]his . . . was painfully demonstrated by the face-off between the Executive and the Court in the 1930s, which resulted in the repudiation of much of the substantive gloss that the Court placed on the Due Process Clauses of the fifth and fourteenth amendments. . . ."*314

As Rehnquist's dissents in Pacific Gas & Electric and Central Hudson suggest, the Court is pushing the bounds of its legitimacy by granting rights, often novel, to entities that