David Rosenberg (Law Department of the Zicklin School of Business, Baruch College, City University of New York) has posted The Corporate Paradox of Citizens United and Hobby Lobby on SSRN. Here is the abstract:
This paper discusses the irreconcilable visions of corporations embodied in the two recent Supreme Court decisions, Citizens United and Hobby Lobby. The former is based on a director and management-centered conception of corporations. Further, Citizens United assumes that all shareholders prioritize profits to the exclusion of other values. Hobby Lobby, in contrast, places the shareholders at the center of the corporation and assumes that a business might pursue goals other than maximizing the bottom line.
Citizens United affirms a corporation’s right to engage in unlimited political spending as an act of free expression under the First Amendment. In that case, the court largely ignored the fact that its decision would allow shareholders to be associated with opinions and causes that they personally oppose. Hobby Lobby, on the other hand, concerns a right that is even more personal — the free exercise of religion. Here, the Supreme Court held that the Religious Freedom Restoration Act prohibited enforcement of a provision of the Affordable Care Act because it burdened the religious rights of the shareholders of an affected corporation. The Court disregarded its earlier conception of a corporation and emphasized the effect that compliance with the law would have had on the religious rights of the shareholders themselves. This decision, then, constitutes a sharp departure from Citizens United by protecting the rights of shareholders over those of other stakeholders and by acknowledging that some corporations might pursue ends other than monetary gain. I argue that these different visions of the corporation arise from the very different rights at issue in the two cases.