Hawaii Senate Bill 2471 Tries to End Run Citizens United

Hawaii beats Montana to the punch

Hawaii Governor Josh Green recently signed Senate Bill 2471 into law. As the bill’s summary states, the bill:

Reaffirms that artificial persons created under state law possess only those powers that are necessary or convenient to carry out lawful purposes, and that those powers do not include the power to spend money or contribute anything of value to influence elections or ballot measures. Authorizes the Attorney General and the Director of Commerce and Consumer Affairs to impose certain penalties for violations.

Regular readers will recall that I wrote two articles about a similar initiative pending in Montana. In the first post, I discussed the state power to define the rights and powers of corporations and expressed some skepticism about the constitutionality of such laws, specifically focusing on whether the state can condition the grant of powers on giving up constitutional rights:

In the second post, I discussed the extent to which Montana (and now Hawaii) can its limits on corporate powers extraterritorially to what out of state corporations do outside of Montana. I concluded that it cannot do so. Hawaii cannot tell a Delaware corporation—even one based in Hawaii—what powers it can wield in states other than Hawaii.

I also discussed the extent to which a state like Hawaii or Montana can regulate the activities of out-of-state corporations in the adopting state, concluding that they may do so.

If this topic is of interest, I would encourage you to check out my posts on Citizens United: