Separate Account

In 1968 Pennsylvania enacted the Nonpublic Elementary and Secondary Education Act authorizing state reimbursement to nonpublic schools for teachers' salaries, textbooks, and instructional materials limited to specified secular subjects including mathematics, modern foreign languages, physical science, and physical education. The statute required recipient schools to maintain separate accounts for state funds, submit to state audits, and obtain prior approval from the Superintendent of Public Instruction for all textbooks and materials purchased with state money. In 1969 Rhode Island enacted the Salary Supplement Act authorizing direct annual payments to eligible teachers in nonpublic elementary schools equal to 15 percent of their current salary, provided the teachers were certified by the state board of education, taught only subjects offered in public schools, used only state-approved materials, and executed a written agreement not to teach any course in religion while receiving the supplement. The great majority of schools receiving aid under both statutes were affiliated with the Roman Catholic Church. In Rhode Island approximately 25 percent of the state's elementary students attended nonpublic schools, 95 percent of whom attended Roman Catholic schools, and all 250 teachers who had applied for salary supplements by the time of suit were employed by such schools. The schools displayed religious symbols such as crosses and crucifixes, conducted religiously oriented extracurricular activities, and employed a substantial number of teaching nuns, with principals typically appointed by religious authorities and school operations governed by a diocesan handbook that integrated religious formation throughout the curriculum. Taxpayers and citizens in each state filed suit challenging the statutes. In Pennsylvania appellant Lemon, a parent of a public-school child and purchaser of a racetrack ticket that funded the program, together with other individual and organizational plaintiffs, sued state officials and seven church-related schools alleging violations of the First and Fourteenth Amendments. In Rhode Island appellant DiCenso and other taxpayers sued state officials, eligible teachers, and parents of children attending church-related schools on the same constitutional grounds. A three-judge district court in Pennsylvania dismissed the complaint for failure to state a claim after finding that the aided schools were church-related and that secular subjects were permeated with religious purpose. A three-judge district court in Rhode Island, after conducting a hearing and receiving extensive evidence concerning the religious character of the schools and the nature of instruction, held the statute unconstitutional under the Establishment Clause and enjoined its enforcement. The parties appealed directly to the Supreme Court under 28 U.S.C. § 1253; the Court noted probable jurisdiction in both cases and consolidated them for argument. By the time of the litigation the Pennsylvania program had entered contracts with 1,181 nonpublic schools serving 535,215 pupils and had expended approximately $5 million annually, while more than 96 percent of the aided pupils attended church-related schools. The Rhode Island program conditioned eligibility on a school's average per-pupil expenditure for secular education falling below the statewide public-school average and required state examination of financial records whenever that threshold was exceeded.

Citizens United is a nonprofit corporation with an annual budget of about $12 million. Most of its funds come from donations by individuals, though it accepts a small portion from for-profit corporations. In January 2008, Citizens United released a 90-minute documentary film entitled Hillary: The Movie. The film mentions Senator Hillary Clinton by name and depicts interviews with political commentators, most of them critical of her. Hillary was released in theaters and on DVD, but Citizens United wanted to increase distribution by making the film available through video-on-demand. In December 2007, a cable company offered to make Hillary available on a video-on-demand channel called Elections '08 for a payment of $1.2 million. The proposal was to make the film available to viewers free of charge. To promote the video-on-demand offering, Citizens United produced two 10-second ads and one 30-second ad. Each ad includes a short statement about Senator Clinton followed by the name of the movie and the movie's website address. Citizens United desired to promote the offering by running the advertisements on broadcast and cable television within 30 days of primary elections. Before the Bipartisan Campaign Reform Act of 2002, federal law prohibited corporations from using general treasury funds to make independent expenditures that expressly advocate the election or defeat of a candidate in connection with certain federal elections. BCRA §203 amended the law to prohibit any electioneering communication. An electioneering communication is any broadcast, cable, or satellite communication that refers to a clearly identified candidate for federal office and is made within 30 days of a primary or 60 days of a general election when publicly distributed so that it can be received by 50,000 or more persons in a relevant state. Concerned about possible civil and criminal penalties for violating 2 U.S.C. §441b, Citizens United filed suit in the United States District Court for the District of Columbia in December 2007. It sought declaratory and injunctive relief, arguing that §441b is unconstitutional as applied to Hillary and that BCRA's disclaimer, disclosure, and reporting requirements are unconstitutional as applied to Hillary and the ads. The District Court denied Citizens United's motion for a preliminary injunction and granted the Federal Election Commission's motion for summary judgment. The Supreme Court noted probable jurisdiction. The case was reargued after the Court requested supplemental briefs addressing whether Austin v. Michigan Chamber of Commerce and the relevant portion of McConnell v. Federal Election Commission should be overruled.

The Bipartisan Campaign Reform Act of 2002 amended the Federal Election Campaign Act of 1971, the Communications Act of 1934, and other statutes to address the role of soft money and issue advocacy in federal elections. Plaintiffs included a diverse group of entities and individuals such as the National Rifle Association and the American Civil Liberties Union who alleged that BCRA was unconstitutional. Defendants included the Federal Election Commission and the Attorney General of the United States. The case was filed in the United States District Court for the District of Columbia and heard by a three-judge panel pursuant to special procedures in BCRA Section 403. The District Court received a voluminous record from the parties and issued a judgment on May 1, 2003, that upheld some provisions of BCRA and invalidated others. All losing parties filed direct appeals to the Supreme Court within ten days, and the Court noted probable jurisdiction on June 5, 2003, ordering expedited briefing and argument on September 8, 2003. More than a century of federal legislation preceded BCRA, beginning with the Tillman Act of 1907 that banned corporate contributions in connection with federal elections. Congress later extended prohibitions to unions, required disclosure of contributions and expenditures, and enacted FECA in 1971 with further amendments in 1974 that imposed contribution limits, expenditure ceilings, and created the FEC. The Supreme Court addressed constitutional challenges to the 1974 amendments in Buckley v. Valeo. After Buckley, the FEC permitted political parties to fund mixed-purpose activities such as voter registration and generic advertising in part with soft money not subject to FECA's source and amount limits. Soft-money fundraising by the national parties grew from $21.6 million in 1984 to $498 million in 2000, with large corporate and union donations often motivated by a desire for access to federal candidates. National parties transferred substantial soft money to state parties, which could use higher percentages for mixed activities under FEC allocation rules. The use of soft money also supported so-called issue ads that avoided express advocacy of a candidate's election or defeat and therefore fell outside FECA's disclosure and source restrictions. These ads frequently aired in the 60 days before federal elections, referred to clearly identified candidates, and were funded by corporations, unions, and tax-exempt organizations using misleading names. A Senate investigation into 1996 federal election practices documented both parties' use of soft money to obtain special access for large donors and the coordination of issue ads with candidates. The District Court compiled extensive evidence from declarations, expert reports, and internal party documents showing that federal officeholders solicited soft-money donations, that parties maintained tallies crediting donors to particular candidates, and that large soft-money contributions were often made to secure influence rather than for ideological reasons.

In 1967 the Detroit Federation of Teachers was certified under Michigan's Public Employment Relations Act as the exclusive bargaining representative of all teachers employed by the Detroit Board of Education. The Union and the Board thereafter concluded a collective-bargaining agreement effective from July 1, 1969, to July 1, 1971. Among the agreement's provisions was an agency shop clause. Every teacher who had not become a Union member within 60 days of hire or of the clause's effective date had to pay the Union a service charge equal to the regular dues required of Union members. A teacher who failed to meet this obligation was subject to discharge. Christine Warczak and other named teachers filed a class action in a state court naming as defendants the Board, the Union, and several Union officials. Their complaint as amended alleged that they were unwilling or had refused to pay dues and that they opposed collective bargaining in the public sector. D. Louis Abood and other named teachers filed a separate action in the same state trial court with virtually identical allegations. This second action was held in abeyance pending disposition of the Warczak appeal. When that case was remanded the two cases were consolidated in the trial court for consideration of the defendants' renewed motion for summary judgment. Following the 1973 legislative amendment that expressly authorized agency-shop clauses the trial court granted summary judgment and upheld the clause under state law and the Federal Constitution. The Michigan Court of Appeals reversed the retroactive application of the amendment but upheld the clause insofar as service fees financed collective bargaining while invalidating it to the extent fees financed political and ideological activities. The Michigan Supreme Court denied review and the plaintiffs appealed to the United States Supreme Court.