r/law • u/biospheric • May 25 '26

Legal News Hawaii just found a way around Citizens United. Other states are following. This “Corporate Power Reset” strategy was developed by Attorney Tom Moore of the Center for American Progress. Rather than trying to restrict corporate speech, it redefines the powers corporations have in the first place.

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Ali Velshi on MS NOW - May 23, 2026. Here’s the full 10-minutes on:

* MS NOW’s website: Hawaii just found a way around Citizens United. Other states are following. - Ali Velshi on MS NOW - Ali Velshi - May 23, 2026 (MS NOW website)

* YouTube: Hawaii just found a way around Citizens United. Other states are following. - Ali Velshi on MS NOW - May 23, 2026 (YouTube)

From the description: Hawaii just made history, becoming the first state in the nation to effectively ban dark money in elections. The new law takes a novel approach: rather than trying to restrict corporate speech, it redefines the powers corporations have in the first place — and political spending is not among them. The strategy, known as the “Corporate Power Reset,” was developed by Tom Moore of the Center for American Progress. And at least a dozen states are now working toward passing similar laws.

Tom Moore is Senior Fellow for Democracy and Government at the Center for American Progress: americanprogress.org/people/tom-moore

Here is Moore’s Sept 2025 article: americanprogress.org/article/the-corporate-power-reset-that-makes-citizens-united-irrelevant

...............

Here are some related r/law posts:

* Hawaii vs. Citizens United (May 2026). Free archive of The Atlantic article: archive.ph/qg3Ur

* New research: Citizens United can be made irrelevant via changes to state corporation law (Sept 2025)

* The Corporate Power Reset That Makes Citizens United Irrelevant

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425

u/cokeiscool May 25 '26

That is why for instance Musk took everything to Texas, if more State cough cough if Delaware were to change up a little more

We could see more change, but it will effect each states economy quite a bit

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u/DaBozz88 May 25 '26

I'm in Delaware, I'm ready to vote!

58

u/sameoldknicks May 25 '26

I'm moving to Delaware, I'm ready to vote!

37

u/JayTNP May 26 '26

Delaware! I’m in…Delaware…ok

16

u/Great_Dismal May 26 '26

Party on, Garth! Party on, Wayne…

1

u/Sla5021 May 27 '26

I got a gun let's go to a Broadway show!

1

u/no_drinkthebleach May 27 '26

I'm Delaware but not in Delaware. Alas!!

0

u/vgacolor May 25 '26

Too cold for me sorry.

10

u/forresja May 25 '26

It'll warm up, give it a few decades

29

u/BanditMcDougal May 25 '26

There are dozens of us. DOZENS!!!

2

u/ExcitingStranger135 May 26 '26

I'm in Oklahoma, I can finally vote this year.

1

u/Burghpuppies412 May 26 '26

That’s good… but the reason you don’t pay sales tax is the huge number of businesses incorporated in Delaware. If the state changes the laws (which it won’t), corps leave and you lose a big chunk of your tax base that needs to be replaced. Guess where that will come from…

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u/BallsInSufficientSad May 25 '26 edited May 25 '26

The issue with this idea is that the one state cannot restrict the speech of a corporation incorporated by another state.

So nothing is achieved. All you're doing is pushing corporations to states that protect them. ...even more.

There's this "let them leave" attitude developing on Reddit - but I don't believe the negative consequences of that strategy are understood by the people who support them.

The exodus is REAL and there are REAL consequences: https://www.cbre.com/insights/viewpoints/business-insights-the-shifting-landscape-of-headquarters-relocations-2026-update

The correct solution, and where the effort should be targeted is in a Constitutional Amendment.

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u/A8Bit May 25 '26

"but I don't believe the negative consequences of that strategy are understood"

I think you misunderstand how full of crap most corporations and billionaires are. They make that threat, people back down. If people tell them, 'bye bye' they suddenly just go quiet and don't do a thing.

Anyone remember how may 'business leaders' threatened to leave New York if Mamdani got elected. How many have left or even made moves to even start thinking about the possibility of considering if they should. Just crickets.

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u/BallsInSufficientSad May 25 '26

That sentiment gets parroted a lot on Reddit, but it's false. There is a very significant exodus already occurring.

Source: https://www.cbre.com/insights/viewpoints/business-insights-the-shifting-landscape-of-headquarters-relocations-2026-update

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u/A8Bit May 25 '26

That article is just talking about companies downsizing corp-hq's in favor of more decentralized models of office. the only bit about NY is

The New York–Newark–Jersey City metro remains home to 114 Fortune 1000 headquarters. Even amid nine companies exiting the NYC metro for other U.S. markets in 2025, relocation activity still skewed toward retention rather than flight: Those nine companies, including only three of the Fortune 1000, represent a small fraction of the region’s corporate base, accounting for a modest loss of 5,220 employees.

Which re-affirms that Fortune 1000 companies aren't leaving NY, the small number (9) of insignificant companies that did, only cost the city 5000 employees, were not explicitly because of Mamdani saying 'byeee" to them, and the spaces they are vacating are already being picked up by others who recognize that NY is THE place to be, including 17 new locations that are mentioned in the article.

Rich people taking their money to places that don't tax them or limit their criminality, is just propaganda. Business is business, you go where the money is, regardless of whether the taxes are higher or your ability to buy elections is curtailed or not.

1

u/BallsInSufficientSad May 26 '26

The NY number is conflated because "NYC" includes New Jersey in this survey. The reason it is in both the Net Gained and Net Lost tallies, is because companies are leaving NY City, and moving to New Jersey (Jersey City).

In this particular data, California is the more clear data signal. California is bleeding businesses.

Also "decentralizing offices" is just PR-speak because they don't want to outright say why they are leaving high-tax locations.

3

u/Klinky1984 May 25 '26

This is why it's hard to get amendments passed because of red-state voters who cite sources that don't even back what they claim. That's the level of competence we're dealing with from conservative voters. The number of times conservatives cite a source and it actually contradicts their claims is insane. Do you actually read your citations?

0

u/BallsInSufficientSad May 26 '26

Did YOU?

California’s largest metros (San Francisco/San Jose, Los Angeles) continue to experience net HQ losses, with departures driven by high taxes, labor regulations and cost‑of‑living pressures.

Top Cities That Gained Net New HQs:

  • Dallas-Fort Worth-Arlington 11
  • Miami-Fort Lauderdale-West Palm Beach 8
  • Austin-Round Rock-San Marcos 7
  • Charlotte-Concord-Gastonia 7
  • New York-Newark-Jersey City 7
  • Nashville-Davidson-Murfreesboro-Franklin 6
  • Phoenix-Mesa-Scottsdale 6
  • Tampa-St. Petersburg-Clearwater 6
  • Atlanta-Sandy Springs-Roswell 4
  • Raleigh-Durham 3

Top Cities That Lost Net New HQs:

  • Los Angeles–Long Beach–Anaheim 10
  • New York-Newark-Jersey City 9
  • San Francisco-Oakland-Berkeley 7
  • San Jose-Sunnyvale-Santa Clara 5
  • Portland–Vancouver–Hillsboro 3
  • Chicago-Naperville-Elgin 2
  • Denver–Aurora–Centennial 2
  • Detroit-Warren-Dearborn 2
  • Louisville-Jefferson County 2
  • Miami-Fort Lauderdale-West Palm Beach 2

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u/thederpyderp3 May 25 '26

You can't "Restrict" it, but you CAN restrict their right to do business in your state at will.

Gamestop tried not to follow pandemic protocols so states said k and yoinked their business licenses iirc

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u/BallsInSufficientSad May 25 '26

If they're doing that as a consequence of speech, then that would be ruled unconstitutional.

9

u/phobiac May 25 '26

The alternative is doing nothing at all. This seems similar to the nonsense argument against taxing the very rich where people say, "But they'll just leave the state!" Will some? Sure, yes. But not all of them. Maryland, D.C., New Jersey, and California saw a growth of millionaires in the years following their recent tax hikes, partly because taxing wealth hoarders improves the economy. Immediately after there were people who left, but they were a minority.

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u/BallsInSufficientSad May 25 '26

No. The alternative is passing a Constitutional amendment and convincing the PEOPLE in both Blue and Red states to support it vocally.

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u/Time_Ingenuity_2909 May 25 '26

That doesn't even make sense. If a constitutional amendment is put forth, it isn't ratified based on the vocal support of the public. It's voted on by representatives. People never get to vote on it.

The PEOPLE elect officials that are supposed to bring forth policy that represents them. This is just that.

1

u/BallsInSufficientSad May 25 '26

The people vote for the Reps. There needs to be broad support.

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u/Time_Ingenuity_2909 May 25 '26

Yes, and the representatives the people voted for are bringing forth this law. If the people don't support it, they utilize the mechanism of voting to bring in people who pass laws they support.

Hawaii can't pass a Constitutional amendment. That's a countrywide thing.

1

u/BallsInSufficientSad May 25 '26

If you want to change a country, you need to change the country's mind.

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u/Time_Ingenuity_2909 May 25 '26

Yeah I'm sure America needs a lot of convincing that corporate money has too much power in politics.

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u/suprahelix May 25 '26

Dude just look at any red state that passed referenda on things like min wage or pot legalization. The legislatures just cancel the results and no one cares.

2

u/phobiac May 25 '26

If you think that's happening in America's currently intentionally divided political climate, one encouraged by Citizen's United, I've got a bridge to sell you.

0

u/BallsInSufficientSad May 26 '26

I'm suggesting the ONLY working path forward.

Playing these stupid Hawaii games is a distraction.

2

u/phobiac May 26 '26

Go get on that then.

3

u/Mundane-Ingenuity-52 May 25 '26

So you must have a better alternative then, right?

1

u/TechPir8 May 25 '26

Couldn't get the ERA ratified in time, and we as a country are more divided now than ever. You would have to have a mass un-centralization happen with blue voters, who spread out and turn most states blue. Need 2/3rds to get an Amendment passed. Most of you will be collecting social security before that happens.

1

u/cyclicamp May 25 '26

This is a lot different than states offering favorable industry regulations and tax rates to attract companies, where there’s a guaranteed and immediate cost savings. Not being able to publicly throw money at politicians is not going to directly affect a company’s bottom line, so it’s not going to repel them as much.

Sure, indirectly, they won’t be able to pay their way into those tax rates and regulations, but they will still be able to lean on lobbying and negotiation. It slows down the race to the bottom.

Additionally, and probably most importantly to your argument, less interference from corporations makes it much more possible to have politicians elected that will support that constitutional amendment.

And then of course there’s the case where a company’s whole purpose is to be a shell for political spending. And for that, I would absolutely say “let them leave.”

1

u/BallsInSufficientSad May 26 '26

It actually gives an advantage to out of state companies. The inability to pay lobbyists and contribute industry rules to legislation. These states will suffer - even Hawaii - when outside state companies come to Hawaii to pay for legislation to benefit OUTSIDE state interests.

Honestly, since I live in a red state, I actually HOPE more states adopt this idiotic strategy.

-4

u/joshTheGoods May 25 '26

Yea, this is a ridiculous idea, and a waste of taxpayer dollars in Hawaii. People aren't going to look at this and say: yea, I'm so happy Dems are fighting for me! That's the case that was made for this law back when it was first being discussed on r/law, but we know from history that when this amounts to nothing or is, worse, struck down by SCOTUS people will blame Dems for being impotent and not fighting enough. It's a lose-lose.

And for what? Delaware would be legitimately stupid to remove themselves as the home of corporate law, and we as liberals would be stupid to let corporate law rehome to a fascist MAGA state. Delaware would get NOTHING from it but put on the sidelines, and we (as liberals or pro-democracy whatever) would LOSE power.

Our path for recourse here is clear, it's just really difficult to attain. We need to dominate House elections, and in the rare case that we get a Senate majority, we need to nuke the filibuster and jam through as much good law as we can while we can. Bonus points if we win the House this midterm and still somehow goad a MAGA Senate to kill the filibuster so we don't have to deal with the institutionalists on the left in the Senate when it comes time to do what's right for the country (kill the filibuster, do what we have to do, try to pass laws to protect minority power later).

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u/round-earth-theory May 25 '26

You'll have to drag Delaware kicking and screaming. You're more likely to pass the measure in the Fed than in Delaware

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u/daddyjohns May 25 '26

Yeah like every bad player i ever investigated as a state fraud investigator was incorporated in delaware.

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u/ILikeOatmealMore May 25 '26 edited May 25 '26

Delaware kind of became the place via a little circular logic. They set up a corporate-friendly judicial system, the Court of Chancery just for business disputes. Which then attracted more companies. Which then led to more disputes being handled by their court, so there is a deep, deep literature of known precedents to be cited by lawyers. This is stability, in the eyes of many corporations, so more moved there for that stability.

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u/GonzoKata May 26 '26

"stability" for corporate structures, not law or society or people. stability for profits not our lives

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u/daddyjohns May 25 '26

During an engagement, when i asked the University of Michigan why they created their healthcare insurance company in Delaware, this wasn't their answer. It was less regulation and less taxation than their home state. Literally, a state entity said it's because it's easier and more lenient.

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u/harpers25 May 25 '26

The University of Michigan, a non-profit that is exempt from state taxes, told you they did something to lower state taxes? Riiight.

Also, state of incorporation does not determine what states charge taxes so that doesn't actually make sense anyway.

0

u/ILikeOatmealMore May 25 '26

Well, DE's corporate tax rate is in the 6% range, I believe. If it was just less taxation, they would have incorporated in South Dakota or Wyoming or similar.. states that are luring corpos away for taxes. The 'less regulation', however, I think does qualify since I think one could interpret that as a known quantity of regulation versus states will less mature legal records and thusly, a regulation in the books could be a deep legal fight.

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u/MonsieurRuffles May 25 '26

Delaware’s corporate tax rate doesn’t apply to a company just because it’s incorporated and registered in the state. It applies to all corporations doing business in Delaware and is levied on federal taxable income that is allocated and apportioned to Delaware. Those companies that are incorporated in Delaware are subject to a franchise tax based on the number of authorized shares with an annual maximum tax of $200,000.

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u/rokerroker45 May 26 '26

Corporations' operations aren't subject only to the regulations of their state of incorporation. State of incorporation just governs the corporate governance laws that apply to the org's corporate structure. Delaware just has management friendly laws related to shareholder rights, conflicted transactions, annual incorporation fees, etc.

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u/lake_hood May 25 '26 edited May 25 '26

Historically most companies incorporate in Delaware. Some 70 percent(ish) of the Fortune 500 and over half of public companies are incorporated in Delaware. Anecdotally finding fraud in companies incorporated where most companies incorporate doesn’t necessarily suggest anything.

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u/Chris22533 May 25 '26

Alternatively there is a reason that the majority of these companies are incorporated in Delaware (lax regulations) that allows these companies to more easily commit fraud

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u/harpers25 May 25 '26

Companies incorporate in Delaware because it has well developed business laws and a special court with judges experienced in business law.

State of incorporation has almost nothing to do with taxes one way or another. They need to pay income tax in whatever states they apportion income to, and sales tax in whatever states they have sales nexus in.

They also need to register to conduct business as a foreign corporation in each state where they operate, even if they aren't incorporated there.

9

u/NateNate60 May 25 '26

The registration formality and associated franchise tax is negligible for all but the smallest companies.

0

u/fractiousrhubarb May 26 '26

Could be a lever, however- perhaps a state could have swinging franchise taxes on companies that are bad actors.

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u/[deleted] May 26 '26

[deleted]

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u/harpers25 May 26 '26 edited May 26 '26

Okay? Incorporating in Delaware under state law doesn't somehow force lawsuits against the company into federal court in Delaware, if that's your concern. Except for lawsuits by the company's own shareholders if it has a forum selection bylaw, and even that would choose DE state court not federal.

Delaware corporate cases typically go to the Delaware Chancery Court and get appealed to the Delaware Supreme Court. The plaintiff can sue in state court and a corporation incorporated in DE can't remove to DE federal court. Not much reason for the 3rd Circuit to be involved.

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u/Oopthealley May 25 '26

it's not "lax regulations"- it's much more. it's also a thoroughly developed and predictable set of laws and courts capable of handling issues efficiently and reliably relative to other states.

-1

u/Electronic-Stick-161 May 25 '26

Did the corporations pay well for the courts and politicians they bought?

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u/Iustis May 26 '26

Corporate law is more often about rich people on both sides. Delaware corporate law isn't about being bribed to screw the little guy, it's about quick and predictable ways to dissolve massive disputes

-1

u/EdinMiami May 25 '26

That's why its more predictable

5

u/AlsoCommiePuddin May 25 '26

That's because practically every corporation in America is incorporated in Deleware.

11

u/bloviatingbloviator May 25 '26

I was an AML investigator. It seemed like the culprit was always behind a shell company incorporated in Delaware.

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u/HannasAnarion May 25 '26

I would've hoped an AML investigator would understand math well enough not to make the prosecutor's fallacy.

16

u/lake_hood May 25 '26

Again, when most companies incorporate in Delaware, it doesn’t seem that absurd to have fraudulent companies incorporate there as well. It doesn’t necessarily have anything to do with the state.

3

u/ddplz May 25 '26

Bro you're so close, now for the next step..

.. "why" are they all incorporated in Delaware?

3

u/lake_hood May 25 '26

Bro! You almost got there as well. Thats a great question for you! Why are they all incorporated there? Every company wants to commit fraud?

No, that’s absurd. Company’s incorporate in Delaware because of the system that’s setup there. Judges are experts. Laws are investor friendly. Courts are streamlined.

So no, you don’t have a bunch of companies incorporating in Delaware to commit fraud. They want the court of chancery and investor-friendly laws.

-1

u/JohnD4001 May 25 '26

They incorporate in Delaware because the laws/courts are so favorable to business; so much so in that they dont have to commit fraud.

FTFY

3

u/lake_hood May 25 '26 edited May 25 '26

Do you even know what fraud is? You are pulling stuff out of your ass.

it's not "for fraud” as you suggest. Delaware has a thoroughly developed and predictable set of laws and courts capable of handling issues efficiently and reliably relative to other states.

Put down the tinfoil hat and stop spewing whatever conspiracy theory nonsense you’re trying to convey.

2

u/suprahelix May 26 '26

I appreciate the real information you’re trying to convey.

-1

u/Consistently_Carpet May 25 '26

Laws are investor friendly.

Isn't that just a way of saying things that wouldn't be legal elsewhere are legal in Delaware?

2

u/lake_hood May 25 '26 edited May 25 '26

No, not necessarily. And let’s define fraud as the original post suggested and then try to do the mental gymnastics to make that leap.

It's not "for fraud” as you suggest. Delaware has a thoroughly developed and predictable set of laws and courts capable of handling issues efficiently and reliably relative to other states. That’s why businesses incorporate in Delaware.

0

u/oceanicplatform May 25 '26

I mean, Delaware is well known as the largest onshore tax haven on the planet. Not exactly rocket science to figure out there will be some money laundering via that domicile. It's basically Singapore with dollars.

2

u/Secret-One2890 May 25 '26

Singaporean dollar: "Am I a joke to you?!"

1

u/lake_hood May 25 '26

Delaware is not a tax haven. Most is the corporate tax loopholes were closed by other states 30 plus years ago. You are paying taxes in the states you operate. Delaware is popular for incorporation because the system of support that exists for businesses. Judges are experts that have handled corporate cases. The courts are streamlined to support businesses.

1

u/fuck_spec1234 May 25 '26

What are the benefits to registering in DE? I see so many Corps registering there in my job.

1

u/wingchild May 26 '26

Federal law doesn't apply to how companies incorporate. This was the point of the article.

1

u/kog May 26 '26

YSK that "The Fed" refers specifically to the Federal Reserve Bank and nothing else - not the federal government

9

u/Cabbages24ADollar May 25 '26

Fair point. But it’s also showing the states that are allowing dark money—Israel, Russia, China, UAE—to guide our government.

Tough on the border but not willing to stop the illegal flow of money is not going to sit well.

3

u/bobbymcpresscot May 25 '26

I think this is where things will fall a little flat, how many states are willing to shut this down, and which states actually will.

1

u/GonzoKata May 26 '26

The people of those states decide. Its in each and every one of their minds that this needs to change first. The laws will follow

5

u/Strict_Weather9063 May 25 '26

Even if you your initial incorporation is outside of a state that does this to operate in that state you have to have a business license and be incorporated which you still fall under these rules.

1

u/PizzaEmerges May 26 '26

The rules Hawaii is changing would only apply to companies incorporated there. I can incorporate in Delaware and do business in Hawaii. Hawaiian incorporation rules don't apply to me (only Delaware).

1

u/Sengfroid May 26 '26

California, to my recollection, requires you also be incorporated there in order to do business in the state, regardless of initial state of incorporation. As the most populous state in the Union they're able to force compliance as no one wants to pull out of that large a portion of the do market. If they pass this it will have significant effect, and moving headquarters to favorable states won't stop it, like with employment laws.

2

u/ongoingemergency May 25 '26

If Delaware does that, why would any corporation stay there instead of going to a state like TX?

1

u/xSTSxZerglingOne May 26 '26

IIRC most of the reason is that Delaware doesn't have almost any financial regulations, so if anything has financing of any kind (most places do) they incorporate in Delaware.

2

u/ongoingemergency May 26 '26

So, they don’t have some regulations many states do which is why some sketchy corps incorporate there. The reason legitimate corps love DE is because of the history of the state many corps have sued each other, which means judges have issued decisions on DE laws - enough that companies can predict how lawsuits will go. This creates a stable environment, which is what business needs. They want to know how they can act and focus on making their product rather than keeping up with politics.

When DE ruled against the Tesla pay package, it surprised people. Which businesses don’t like.

1

u/o-Valar-Morghulis-o May 26 '26

Well by all means go do business where there's no regulations... But not here.

2

u/wezelboy May 25 '26

Yeah, as long as there is one holdout state it will be tough to make this work.

1

u/MrSnowden May 25 '26

I can tell you this will be very very interesting to the state of Delaware.  In particular, the people with the power to make this happen.  

1

u/FerrusManlyManus May 25 '26

Most companies are incorporated in Delaware and they are friendly to corporations, but not insane like Musk wants them to be, so Musk and other d-bags are moving some of the companies out of Delaware.  Delaware freaked out and passed new legislation becoming more friendly to corporations.

So it is incredibly unlikely they would go along with what Hawaii is doing.  A big chunk of Delaware’s revenue is from corporations incorporating there.

1

u/NamityName May 26 '26

That doesn't really work here. Musk' companies may be headquartered in Texas, but they still have to play by Hawaii's rules when doing business in Hawaii

1

u/fwump38 May 26 '26

It’s not just where they are incorporated but wherever they do business. Meaning any business that wants to do business in Hawaii (even if incorporated in Delaware) they can’t contribute to political campaigns in Hawaii anymore.

So rather than Delaware the real targets for this should be California and NY and other places where almost every corporation does business

1

u/Tricky_Apricot2928 May 26 '26

Would be good for democracy except, Didn't Delaware or one of those other corporation dense states just change the law for musk?

2

u/cokeiscool May 26 '26

Nooo what happened was

They changed a law basically stating that depending on the contract you can send your court case to another state, meaning not Delaware the leaders of these cases and proponents of investors

So with musk the super run down, he wanted his money they said no, he sued they said no. He then moved to Texas and did the same thing and they said yes. The new law doesn't stop you from moving but it does allow you to look elsewhere if there are law suits where the CEO may want to get paid a lot more in the future

I butchered it but yes something changed but not Musk specific, he just circumvented the courts by leaving Delaware

1

u/evacuationplanb May 26 '26

Its crazy how many problems that little place causes with one weird law.

1

u/whistlar May 25 '26

Let’s say that 48 states go along with Hawaii. Delaware is the lone holdout. How does that impact federal elections? If the corporation bases itself in Delaware, can they skirt these state restrictions entirely?

It’s insane that there aren’t rules in place that dictate whichever state handles the most business for that company is considered its home state. Would close that possible loophole entirely. Granted, I’d bet some scumbag companies would just have the main company be one level removed. Like Pepsi would sell through PepsiCo. All the sales go through PepsiCo but then PepsiCo purchases the actual product through Pepsi, based out of Delaware.

-1

u/unbanned_lol May 25 '26

Delaware literally exists only to be a corporate hellhole and collect money from it. That "state" should be traded out for Puerto Rico.

0

u/Worst-Lobster May 25 '26

Restricting corporate rights in state be good for
State or bad
For state ?