Essay

How Corporations Got the Rights of People Without the Consequences

A corporation can spend unlimited money to influence your elections, claim religious freedom to deny your healthcare, and invoke the same constitutional protections written to free enslaved people. It cannot be imprisoned for any of it. Here is how that happened.

If you poison a community’s water supply, you go to prison. If a corporation does it, it negotiates a settlement, pays a fine that represents a fraction of the profits generated by the conduct that caused the harm, issues a statement expressing concern for affected families, and continues operating. No executive goes to prison. No admission of wrongdoing is required. The fine is tax deductible. The people with contaminated water are left to pursue civil litigation against an entity with more lawyers than they have neighbors.

This asymmetry is not an accident or a regulatory failure. It is the designed output of a legal doctrine built over a century and a half, piece by piece, through court decisions, legislative maneuvers, and at least one clerical act that was never supposed to have the force of law but somehow acquired it anyway. The doctrine is called corporate personhood. It gives corporations the constitutional rights of human beings while exempting them from the consequences of having a body.

The headnote that became law

The foundation of corporate personhood in American law rests on a Supreme Court case called Santa Clara County v. Southern Pacific Railroad, decided in 1886. The case itself was a routine tax dispute between a California county and a railroad over how to assess property taxes. The actual decision said nothing about whether corporations deserved constitutional rights. What mattered was what the court reporter wrote in the headnote.

Headnotes are the prefatory summaries that appear before published court opinions. They have no legal force. They are editorial summaries, nothing more. The court reporter in 1886 was a man named Bancroft Davis, a former railroad executive. Before the opinion was published, Davis wrote in the headnote that the Court had agreed corporations were persons under the Fourteenth Amendment’s equal protection clause. The justices, when asked, said the wording was accurate enough. Nobody formally decided the question. Nobody argued the point. A clerical note by a former railroad man entered the published record, and later courts cited the headnote as precedent.

The Fourteenth Amendment had been ratified in 1868 to establish that formerly enslaved people were citizens of the United States entitled to equal protection under law. It was a direct response to the Black Codes, the post-Civil War laws that had effectively re-enslaved Black Americans through vagrancy statutes and systematic denial of legal rights. Within eighteen years of its ratification, the amendment that was written to protect human beings from state violence had been repurposed as the primary constitutional shield of railroad corporations. The people it was written for continued to be lynched, disenfranchised, and excluded from economic life for another century. The corporations used it to fight tax assessments, shield their operations from regulation, and legally externalize the costs of their conduct onto the communities, workers, and environments that bore them.

How the rights expanded

Once corporations had the legal standing of persons, the question became which rights personhood carried. The answer, across the following century, was: most of them, and more every decade. The Fourth Amendment protection against unreasonable search and seizure. The Fifth Amendment right against self-incrimination. The First Amendment right to free speech. Each expansion followed the same pattern: a corporation asserted a constitutional right in litigation, and a court agreed.

The Citizens United decision in 2010 was the most consequential expansion. The Supreme Court ruled that corporations have First Amendment free speech rights and that political spending is speech, therefore corporations cannot be restricted from spending unlimited money on elections. The decision did not create corporate personhood. It extended a right that had been accumulating since 1886 to its most politically potent application. In the 2024 election, super PACs spent a record $2.7 billion on federal races. Dark money, the difficult-to-track donations enabled by Citizens United, grew from under $5 million in 2006 to over $1 billion in the 2024 presidential election alone. That is not political participation. That is the purchase of electoral outcomes by entities that cannot vote, cannot be drafted, cannot be imprisoned, and will outlive every human being casting a ballot.

In 2014, the Supreme Court ruled in Burwell v. Hobby Lobby that closely held corporations have religious freedom rights under the Religious Freedom Restoration Act. A corporation, a legal abstraction with no soul, no body, no faith, was granted religious exemptions that could be used to deny employee healthcare coverage. The rights continued to accumulate. The consequences never arrived.

The consequences that never came

A corporation cannot be imprisoned. It has no body to confine. This is the standard explanation for why corporate personhood has never been extended to include the consequences of personhood. But the explanation collapses on examination. The entire basis of corporate personhood is that a legal abstraction can hold the rights of a physical person. If an abstraction can hold the right to free speech, the right to religious freedom, the right against unreasonable search, and the right to equal protection, there is no logical reason it cannot also hold the obligation of criminal accountability. The law simply chose not to extend it there.

The mechanism that prevents accountability is called limited liability. When a corporation commits an act that would constitute a crime if committed by a person, the corporation absorbs the liability. The individuals who made the decisions are protected by the corporate structure from personal consequences. The corporation pays a fine. The fine is paid by shareholders, employees through reduced compensation, and customers through higher prices. The decision-makers walk. This is not a side effect of the legal structure. It is the purpose of it.

Consider what this produces in practice. The opioid crisis killed approximately 500,000 Americans between 1999 and 2019. The Sackler family, which owned Purdue Pharma, took more than $10 billion out of the company while it marketed OxyContin with documented knowledge of its addictive properties. Purdue Pharma pleaded guilty to criminal charges in 2020. The company paid fines. Members of the Sackler family received civil immunity as part of the settlement. No family member was imprisoned. The people who died remain dead. The people who made the decisions remain wealthy.

This pattern repeats across industries and decades because the legal architecture produces it reliably. The corporation holds the liability. The humans hold the profits. When the liability becomes large enough to threaten the corporation, a settlement is negotiated. The settlement includes no admission of wrongdoing. The cycle begins again with the next product, the next market, the next externalized cost landing on the bodies of people who never consented to bear it.

The forty-year project

None of this happened by accident. The railroad lawyers who engineered the Santa Clara headnote in 1886 were not making a clerical error. Bancroft Davis was not a neutral reporter who happened to write something down. He was a former railroad executive whose appointment as Supreme Court reporter was itself a product of the same network whose interests the headnote served. The personhood doctrine was the completion of a strategy that had been running in legal briefs for a decade before the case was decided. The case was selected. The argument was seeded. The headnote crystallized it into something that looked like settled law.

The same strategy is running today. Legal scholars call it doctrinal seeding. A justice writes an opinion in an unrelated case that contains language, a phrase, a legal principle, not necessary to decide that case but available to be cited as precedent in a future one. The language sits in the record waiting to be activated. This is not a theory about intent. It is observable in the opinions themselves, documented by legal scholars, and coordinated at the institutional level by the Federalist Society, a legal organization founded in 1982 at Yale, Harvard, and the University of Chicago.

The Federalist Society was founded the year after the Powell Memo’s institutional infrastructure had finished being built. It was funded by the same foundations the Powell Memo activated: the Olin Foundation, the Scaife Foundation, and the Koch network. Its explicit purpose was to train a generation of lawyers and judges in legal doctrines that would advance corporate interests through the courts. The Supreme Court justices who decided Citizens United, Hobby Lobby, and the cases that followed were not appointed randomly. They were identified, cultivated, placed in federal clerkships, elevated to circuit courts, and eventually nominated to the Supreme Court through a coordinated pipeline spanning four decades. The legal architecture of corporate power was not discovered. It was built, case by case, appointment by appointment, headnote by headnote, across a timeline that most people never see because they are only watching individual decisions, not the pattern connecting them.

The argument that has not been made in the Supreme Court is not waiting for someone to think of it. It is waiting for a court that has not been built to prevent it. How that court was built, by whom, and over how long, is the subject of the next essay in this series.