Corporate Personhood and Limited Sovereignty
31 Pages Posted: 4 Aug 2021
Date Written: July 29, 2021
This Essay, written for a symposium celebrating the work of Professor Margaret Blair, examines how corporate rights jurisprudence helped to shape the corporate form in the United States during the nineteenth century. It argues that as the corporate form became popular because of the way it facilitated capital lock-in, perpetual succession, and provided other favorable characteristics related to legal personality that separated the corporation from its participants, the Supreme Court provided crucial reinforcement of these entity features by recognizing corporations as right-bearing legal persons separate from the government. Although the legal personality of corporations is a distinct concept from their constitutional treatment, the Court’s nineteenth-century rulings bolstered key features created by corporate law and simultaneously situated the corporation as subordinate to the state in a system of federalism. And, finally, the Essay suggests that the balance of power struck in the first century of Supreme Court jurisprudence on corporate rights has been eroded in the modern era. The Supreme Court’s failure to develop a consistent approach to corporate rights questions and its tendency to reason based on views of corporations as associations of persons have exposed a significant flaw in the Court’s evolving corporate personhood jurisprudence: it lacks a limiting principle.
Keywords: Corporation law, personhood, legal persons, asset partitioning, capital lock-in, corporate governance, Supreme Court, SCOTUS, Bank of the United States, Dartmouth College, Fourteenth Amendment
JEL Classification: G30, K20, K22, N81
Suggested Citation: Suggested Citation