Regulating Public Relations: How U.S. Legal Policies and Regulations Shaped Early Corporate Public Relations

Abstract

Nineteenth and twentieth century developments in corporations’ legal duties involving “public relations” activities gave rise to professional public relations practice. During the nineteenth and early twentieth centuries, court cases, trade press, and the popular press used the term “public relations” to refer to the status of an organization and certain expected behaviors. As corporations and utilities grew in the late nineteenth century these “public relations” responsibilities were applied to them creating a legal requirement of transparency, disclosure, and good faith actions. Examining court decisions and the popular press this paper shows how this application of the term “public relations” to corporations had a relationship with public relations practice. Implications for public relations historiography and American public relations development are discussed.

Endnotes

Notes

1 Edward Bernays, Crystallizing Public Opinion (New York: Liveright, 1923); Edward Bernays, Propaganda (New York: Liveright, 1928); Edward Bernays, The Engineering of Consent (Norman: University of Oklahoma Press, 1955); Edward Bernays, Public Relations (Norman: University of Oklahoma Press, 1952); Edward Bernays, Biography of an Idea: Memoirs of Public Relations Counsel Edward L. Bernays (New York: Simon and Schuster, 1965).

2 Scott Cutlip, The Unseen Power (Hillsdale: Lawrence Erlbaum Associates, 1994); Scott Cutlip, Public Relations History from the 17th to the 20th Century: The Antecedents (Hillsdale: Lawrence Erlbaum Associates, 1995); James Grunig and Todd Hunt, Managing Public Relations (New York: Holdt, Rinehart and Winston, 1984).

3 Günter Bentele, “Problems of Public Relations Historiography and Perspectives of a Functional-Integrative Stratification Model,” in Perspectives on Public Relations Historiography and Historical Theorization, edited by Tom Watson (New York: Palgrave Macmillan, 2015); Jacquie L’Etang, “Where is Public Relations Historiography? Philosophy of History, Historiography and Public Relations,” in Perspectives on Public Relations Historiography and Historical Theorization, edited by Tom Watson (New York: Palgrave Macmillan, 2015); Margot Lamme and Karen Russell, “Removing the Spin: Toward a New Theory of Public Relations Development,” Journalism and Communication Monographs 11, no. 4 (2010): 281–362; Karen Miller, “U.S. Public Relations History: Knowledge and Limitations,” Communication Yearbook 23 (2000): 381–420; Cayce Myers, “Reconsidering the Corporate Narrative in U.S. Public Relations History: A Critique of Alfred Chandler’s Influence on PR Historiography, Public Relations Review 40 (2014): 676–83; Stefan Wehmeir, “Historiography (and Theory) of Public Relations History,” in Perspectives on Public Relations Historiography and Historical Theorization, edited by Tom Watson (New York: Palgrave Macmillan, 2015); Tom Watson, “What in the World is Public Relations?,” in Perspectives on Public Relations Historiography and Historical Theorization, edited by Tom Watson (New York: Palgrave Macmillan, 2015).

4 Karla Gower, “U.S. Corporate Public Relations in the Progressive Era,” Journal of Communication Management 12, no. 4 (2008): 305–18; Linda Childers Hon, “‘To Redeem the Soul of America: Public Relations and the Civil Rights Movement,” Journal of Public Relations Research 9 (1997): 163–212; Margot Opdyche Lamme, “The ‘public sentiment building society’: The Anti-Saloon League of America, 1895–1910,” Journalism History 9 (2003): 123–32; Margot Opdycke Lamme, Public Relations and Religion in American History: Evangelism, Temperance, and Business (New York: Routledge, 2014); Cayce Myers, “Reconsidering Propaganda in Public Relations History: An Analysis of Propaganda in the Popular Press 1810-1918,” Public Relations Review 41, no. 4 (2015): 551–61; Cayce Myers, “Early U.S. Corporate Public Relations: Understanding the ‘Publicity Agent’ in American Corporate Communications, 1902–1918,” American Journalism 32, no. 4 (2015): 412–33; Karen Russell and Carl Bishop, “Understanding Ivy Lee’s Declaration of Principles: U.S. Newspaper and Magazine Coverage of Publicity and Press Agentry 1865-1904,” Public Relations Review 35, no. 2 (2009); Marvin Olasky, “Retrospective: Bernays’ Doctrine of Public Opinion,” Public Relations Review 10 (1984).

5 Timothy Coombs and Sherry Holladay, “Privileging an activist vs. a corporate view of public relations history in the U.S.,” Public Relations Review 38 (2012): 347–53; Tom Watson, “Let’s Get Dangerous,” Public Relations Review 40 (2014): 874–7.

6 Grunig and Hunt, Managing Public Relations, 22.

7 Bernays, Public Relations, 27–76; Cutlip, Public Relations History from the 17th to the 20th Century: The Antecedents.

8 Bernays, Crystallizing Public Opinion; Bernays, Propaganda; Bernays, The Engineering of Consent; Bernays, Public Relations; Bernays, Biography of an Idea: Memoirs of Public Relations Counsel Edward L. Bernays; Cutlip and Center, Effective Public Relations; Cutlip, The Unseen Power; Cutlip, Public Relations History from the 17th to the 20th Century: The Antecedents; Grunig and Hunt, Managing Public Relations.

9 Bernays, Crystallizing Public Opinion; Bernays, Propaganda; Bernays, The Engineering of Consent; Bernays, Public Relations; Bernays, Biography of an Idea: Memoirs of Public Relations Counsel Edward L. Bernays. It is important to note that Bernays had a very specific definition of public relations that tied it to influencing and understanding publics through social scientific research rooted in psychological insights. Using that definition, one could argue that public relations prior to Bernays was fundamentally different. However, Bernays’s definition is very narrow, and one that is particularized to him.

10 Cutlip, Public Relations History from the 17th to the 20th Century: The Antecedents.

11 Miller, “U.S. Public Relations History: Knowledge and Limitations;” Myers, “Reconsidering the Corporate Narrative in U.S. Public Relations History: A Critique of Alfred Chandler’s Influence on PR Historiography.”

12 Grunig and Hunt, Managing Public Relations, 22.

13 The four models of public relations are a social scientific theory typology of public relations practice that is rooted in public engagement and ethics. It has been suggested that this model was not intended to be used as a means to periodize public relations history. Larissa Grunig and James Grunig, “Public Relations in the United States: A Generation of Maturation,” in The Global Public Relations Handbook: Theory, Research and Practice, edited by K. Sriamesh and D. Verčič (Hillsdale: Lawrence Erlbaum Associates, 2003), 337.

14 Cayce Myers, “Reconsidering Public Relations Institutions: An Analysis of Publicity and Information Bureaux 1891–1918,” Public Relations Review 42, no. 5 (2016): 766–75; Karen Russell and Cayce Myers, “The Misunderstood Nineteenth Century U.S. Press Agent,” Public Relations Review 45 (2019): 246–57.

15 Russell and Myers, “The Misunderstood Nineteenth Century U.S. Press Agent.”

16 Gower, “U.S. Corporate Public Relations in the Progressive Era;” Myers, “Early U.S. Corporate Public Relations;” Russell and Myers, The Misunderstood Nineteenth Century U.S. Press Agent.”

17 Cayce Myers, “United States Antecedents and Proto-PR,” in North American Perspectives on the Development of Public Relations: Other Voices, edited by Tom Watson (Basingstoke: Palgrave Pivot, 2016).

18 Ibid.

19 Marvin Olasky, Corporate Public relations: A New Historical Perspective (Hillsdale: Lawrence Erlbaum Associates, 1987), 2–6, 7–14.

20 Cutlip and Center, Effective Public Relations; Cutlip, The Unseen Power; Cutlip, Public Relations from the 17th to 20th Century; Roland Marchand, Keeping the Corporate Soul: The Rise of Public Relations and Corporate Imagery in American Big Business (Berkeley: The University of California Press, 1998; Richard S. Tedlow, “Preface Up From Press Agentry,” in Keeping the Corporate Image: Public Relations and Business 1900-1959, edited by Richard S. Tedlow (Greenwich: Jai Press, 1979).

21 Alfred Chandler, “The Beginnings of ‘Big Business’ in American Industry,” Business History Review 33 (1959): 1–31; Alfred Chandler, Strategy and Structure (Cambridge: The MIT Press, 1962); Alfred Chandler, “The Railroads: Pioneers of modern Corporate Management,” Business History Review 39 (1965): 16–40; Richard Tedlow, New and Improved: The Story of Mass Marketing in America (New York: Basic Books, 1976); Alfred Chandler, The Visible Hand: The Managerial Revolution in American Business (Cambridge: The Belknap Press of Harvard University Press, 1977); Tedlow, “Preface: Up From Press Agentry;” Alfred Chandler and Richard S. Tedlow, The Coming of Managerial Capitalism: A Casebook on the History of American Economic Institutions (Homewood: Richard D. Irwin Inc., 1985).

22 Marchand, Keeping the Corporate Soul; Olasky, Corporate Public Relations, 1–6.

23 Olasky, Corporate Public Relations, 15–32.

24 Myers, “Reconsidering Public Relations Institutions,” 766–75.

25 Elinor Ostrom, “Institutional Rational Choice: An Assessment of the Institutional Analysis and Development Framework,” in Theories of the Policy Process, edited by P.A. Sabatier, 2nd ed. (Boulder, CO: Westview Press, 1997), 21–64.

26 Michael Kraft and Scott Furlong, Public Policy: Politics, Analysis, and Alternatives, 6th ed. (Los Angeles: Sage, 2017), 36–77.

27 Larry Reynolds, “Foundations of an Institutional Theory of Regulation,” Journal of Economic Issues 15 (1981): 641–56, 641.

28 Richard Scott, “Approaching Adulthood: The maturing of Institutional Theory,” Theory and Society 37 (2008): 427–42, 428.

29 John Campbell, “Why Would Corporations Behave in Social Responsible Ways? An Institutional Theory of Corporate Social Responsibility,” Academy of Management Review 32 (2007): 945–67.

30 Neil MacCormick and Ota Weinberger, “Introduction,” in An Institutional Theory of Law: New Approaches to Legal Positivism, edited by Neil MacCormick and Ota Weinberger (Boston: D. Reidel Publishing Company, 1986), 14.

31 Ibid.

32 Campbell, “Why Would Corporations Behave,” 945–67; MacCormick and Weinberger, “Introduction,” 14; Scott, “Approaching Adulthood,” 428.

33 Popular press representations were obtained using ProQuest Historical Newspapers Online, American Periodical Series, JSTOR, America’s Historical Newspapers, and Accessible archives using the search term “public relations*” from the year 1770 to 1918. The year 1770 was used as a starting date because it was the year of the Boston Massacre representing the separation from the British government, but was also chosen to capture the earliest possible date for the use of the term public relations in these databases. The year 1918 was chosen as an end date because the end of World War I has been thought to represent a major change in corporate public relations because of the influence of Edward Bernays. Because the Electric Railway Journal was repeatedly mentioned in the articles from the digital databases that journal was also produced six additional articles. The initial database search produced 714 articles from the popular, trade, and academic presses concerning “public relations.” This resulted in a total of 163 articles. This was combined with the six articles from Electric Railway Journal, which produced a total number of 169 articles. Court cases involving public relations were generated through Westlaw legal database. Westlaw was keyword searched for “public relations” in all federal and state cases prior to January 1, 1919 with the first case being found in 1795. This search produced forty-one cases from federal and state courts all of which were analyzed in this study. All articles and legal cases were analyzed, except for articles that appeared in JSTOR from non-U.S. journals.

34 Talbot v. Jansen, 2 U.S. 133, 144 (1795); Novion v. Hallett, 16 Johns. 327, 336 (1819); Scott v. Depeyster, 1 Edw.Ch. 513, 529 (1832); 29 Barb. 589, 594 (1859); The Attorney General v. The Chicago and Northwestern Railway Company and The Chicago, Milwaukee and St. Paul Railway Company, 35 Wis. 425, 567-568 (1874); Strawbridge v. Philadelphia, 2 Pennyp. 419, 431 (1882); Mitchell v. La Grange, 37 N.Y.S. 991 (1896); Louisiana v. Texas, 176 U.S. 1, 17 (1900); Davis v. Janeway et al., 155 P. 241, 242–243 (Okla. 1916).

35 Jansen, 3 U.S. at 144; Cheriot v. Foussat, 3 Binn 220, 237 (1810); Hallett, 16 Johns. at 336; Hallett v. Lamothe, 3 Mur. 279, 291 (1819); The Commonwealth v. Kosloff, 1816 WL 1582, *4 (1820).

36 In admiralty law filing a lawsuit is called filing a libel. Libel here is not the same as defamation. In admiralty law the libel is the primary claim in admiralty court.

37 Hallett, 3 Mur. at 291.

38 Marc Bloustein, “A Short History of the New York State Court System,” The Historical Society of the Courts of the State of New York, December 5, 1985, http://www.nycourts.gov/history/legal-history-new-york/documents/History_Short-History-NY-Courts.pdf; Henry Wilson Scott, The Courts of the State of New York: Their History Development and Jurisdiction (New York: Henry Wilson Publishing Co.), https://www.nycourts.gov/history/legal-history-new-york/legal-history-eras-02/documents/scott-history-court-errors.PDF. It is important to note that the Court for the Correction of Errors of New York was a political, rather than a legal, court. Abolished in 1847, the Court for the Correction of Errors heard appeals from the New York Supreme Court, which was then, as it is today, a trial court. The head of the court was the state’s Lieutenant Governor and the court consisted of New York Supreme Court Justices, the Chancellor, and members of the New York Senate.

39 Interestingly the embezzlement went unnoticed until Kane’s suicide in 1828. At that time ledgers showed Kane’s elaborate embezzlement scheme.

40 Scott, 1 Edw.Ch. at 529.

41 Brooks v. Donegal Borough School District et al, 28 Pa.D. 783, 794 (1918) (citing Spelling’s Extraordinary Remedies, Part 2, section 1379 at 1189-1190).

42 The Attorney General v. The Chicago and Northwestern Railway Company and The Chicago, Milwaukee and St. Paul Railway Company, 35 Wis. 425 (1874); Richmond Railway & Electric Company v. Brown, 32 S.E. 775 (Va. 1899); Robbins v. Bangor Railway & Electric Co., 100 Me. 496 (1905); Carolina C. & O. Railway v. Board of Supervisors of Scott County, 63 S.E. 412 (Va. 1909); Brooks v. Donegal Borough School District et al., 15 Del.Co. 126 (1918).

43 Carolina C. & O. Railway v. Board of Supervisors of Scott County, 63 S.E. 412 (Va. 1909). The Virginia Supreme Court of Appeals was renamed now the Virginia Supreme Court in 1970. It is the Commonwealth’s highest state appellate court.

44 Richmond Railway & Electric Company v. Brown, 32 S.E. 775, 776 (Va. 1899).

45 Carolina C. & O. Railway v. Board of Supervisors of Scott County, 63 S.E. 412 (Va. 1909).

46 Richmond Railway & Electric Company v. Brown, 32 S.E. 775 (Va. 1899).

47 Richard White, Railroaded (New York: W.W. Norton, 2012), 174–78.

48 The Attorney General v. The Chicago and Northwestern Railway Company and The Chicago, Milwaukee and St. Paul Railway Company, 35 Wis. 425 (1874); Richmond Railway & Electric Company v. Brown, 32 S.E. 775 (Va. 1899); Robbins v. Bangor Railway & Electric Co., 100 Me. 496 (1905); Carolina C. & O. Railway v. Board of Supervisors of Scott County, 63 S.E. 412 (Va. 1909); Brooks v. Donegal Borough School District et al., 15 Del.Co. 126 (1918).

49 W. H. Gardiner, “Public Relations and Taxation of Public Service Corporations,” State and Local Taxation: International Conference Under the Auspices of the International Tax Association: Addresses and Proceedings 3 (1909): 175–80; “Provisions for Annual Conference,” State and Local taxation: International Conference nder the Auspices of the International Tax Association: Addresses and Proceedings 4 (1910): 417–32; “Provisions for Annual Conference,” State and Local Taxation: International Conference under the Auspices of the International Tax Association: Addresses and Proceedings 3 (1909): 375–87; “Constitution of the National Tax Association,” State and Local Taxation: Annual Conference Under the Auspices of the National Tax Association: Addresses and Proceedings 5 (1911): 460–85; “Appendix,” State and Local Taxation Annual Conference Under the Auspices of the National Tax Association: Addresses and Proceedings 6 (1912): 521–58.

50 Ibid.

51 “Private Corporations and the State,” Journal of Social Science, Containing the Proceedings of the American Association, November 1887, 145.

52 Ibid.

53 “The Ratcatcher’s Gospel,” Littell’s Living Age, January 23, 1858, 212.

54 Ernst Freund, “Private Claims Against the State,” Political Science Quarterly 8 (1893): 651; “Ohioans Here Show Loyalty to Taft,” New York Times, January 28, 1912, 1.

55 “The Corporation Problem,” American Law Review (January/February 1892): 167.

56 Edward L. Andrews, “Considerations for a Sixteenth Amendment,” Albany Law Journal (December 1907): 363

57 “Wise and Otherwise,” Christian Advocate, April 4, 1901, 556.

58 “Statement of the Corporation Counsel,” New York Times, February 24, 1875, 2.

59 “Current Legal Periodicals and Work Reviews,” American Law Register 54 (1906): 688.

60 William Morgan, “The Indeterminate Permit as a Satisfactory Franchise,” Annals of the American Academy of Political and Social Science 37 (1911): 142.

61 “Holland’s Letter,” Wall Street Journal, April 12, 1912, 1; “Electric Railway Men Say First Duty of Roads is Safety,” Christian Science Monitor, October 15, 1914, 13.

62 “Utilities Adopt Code of Public Relations Principles,” Wall Street Journal, October 24, 1914, 6.

63 Ibid.

64 Charles Black, “How the American Association is Developing Good Public Relations,” Electric Railway Journal, October 3, 1914, 651.

65 Ibid.

66 James Garfield, “Publicity in Affairs of Industrial Combinations,” Annals of the American Academy of Political and Social Science 42 (1912): 140.

67 “Finance, Western Union’s Move Toward Corporation Publicity,” Harper’s Weekly, October 22, 1910, 22.

68 “Electric Roads Men Meet,” New York Times, October 8, 1912, 15.

69 “Amicable Relations Between Public and Utility Companies,” Christian Science Monitor, November 22, 1912, 13.

70 Theodore Vail, “What’s Ahead for Business?” Independent, July 20, 1914, 92.

71 Ibid.

72 “American Tel. & Tel. is Now Financed Ahead Until 1916,” Wall Street Journal, April 1, 1914, 2.

73 “American Public Utilities Gross Earnings Increase,” Wall Street Journal, September 21, 1914, 7.

74 Ibid.

75 “Book Notes,” Political Science Quarterly, September 1898: 8; “Periodicals,” American Economic Review 4 (1914): 1000; “Periodicals,” American Economic Review 6 (1916): 986.

76 Hurd Hamilton, History of New London County, Connecticut, with Biographical Sketches of Many of Its Pioneers and Prominent Men (Philadelphia: J.W. Lewis and Co., 1882), 351.

77 “Legislative Power to Regulate Railway Tariffs,” Central Law Journal, May 21, 1875, 11.

78 Edwin Seligman, “Railway Tariffs and the Interstate Commerce Law,” Political Science Quarterly 2 (1887): 247. The value of service doctrine is a legal principal that legal damages will be applied to defendants according to what the defendant can pay and what the value of the service is.

79 “Notes of Recent Decisions,” The Central Law Journal, September 23, 1892, 242; A.H. Robbins, “Carrier-Personal Injuries-Free Pass-Release-Effect-negligence,” The Central Law Journal, September 1901, 252.

80 “Notes of Recent Decisions,” Central Law Journal, 242.

81 A. H. Robbins, Carriers-Personal Injuries-Free Pass-Release-Effect-Negligence, 252.

82 Ernst Freund, “Private Claims Against the State” Political Science Quarterly (December 1893): 3.

83 “The Bond Market,” Wall Street Journal, October 29, 1907, 5; “State Corporation Commission,” Virginia Law Register 3 (1917): 257.

84 “Cooperation with Railways Essential,” Christian Science Monitor, December 10, 1913, 11.

85 “Life Insurance—Warranty,” Central Law Journal (November 27, 1874): 597; “Life Insurance—Missouri Act as to Misrepresentations in Policies Construed,” Central Law Journal (December 7, 1877): 486; Frederick Austin, “Place of Contract,” Central Law Journal (July 27, 1900): 64; Miles Dawson, “Publicity of Accounts of Industrial Corporation,” Annals of the American Academy of Political and Social Science 42 (1912): 98.

86 “Brooklyn Life Insurance Co.,” Independent, February 19, 1880, 18.

87 Justus Wakelee, “The Public Relations of Public Utility Companies,” Electric Railway Journal, November 25, 1916, 1095.

88 Ibid.

89 Ibid.

90 Luigi Criscuolo, “Market Place Talks,” Independent, December 4, 1916, 428.

91 “Knapp is Optimistic,” Washington Post, June 17, 1907, 4; “Western Railroad Managers Still Practicing Economy,” Wall Street Journal, January 19, 1912, 7; “Railways See Dawn of a Brighter Day” New York Times, December 26, 1915, 34.

92 “Western Railroad Managers Still Practicing Economy,” Wall Street Journal, January 19, 1912, 7.

93 Ibid.

94 “Public Gouged by Railroads,” Atlanta Constitution, December 28, 1902, A5.

95 “Getting Employees to Help,” Electric Railway Journal, December 9, 1916, 1189.

96 “Every Employee a Publicity Representative,” Electric Railway Journal, November 4, 1916, 961.

97 F. R. Coates, “How to Improve Public Relations,” Electric Railway Journal, December 2, 1916, 1154.

98 Carolina C. & O. Railway v. Board of Supervisors of Scott County, 63 S.E. 412 (Va. 1909); Richmond Railway & Electric Company v. Brown, 32 S.E. 775, 776 (Va. 1899).

99 Allyn Young, “Capital and Capitalistic Organizations,” American Economic Association, September 1911, 583.

100 “The Metropolitan’s Control Ratified,” New York Times, May 18, 1900, 1.

101 Martin Littleton, “The Drift of Events,” Journal of Social Science, Containing the Proceedings of the American Association, September 1907, 126.

102 “United Railways of St. Louis,” Wall Street Journal, November 2, 1918, 6.

103 “Topics on Wall Street,” New York Times, September 6, 1913, 10.

104 “When the Corporation is Good,” Atlanta Constitution, October 31, 1910, 4.

105 “Says Graft is Treason,” New York Times, April 14, 1910, 2.

106 “Judiciary in Peril,” Washington Post, June 28, 1912, 1.

107 “Topics in Wall Street,” New York Times, January 25, 1914, 88.

108 “Boston Men on Program of Coming Trolley Convention,” Christian Science Monitor, October 3, 1914, 16.

109 “Electric Men on a Trip,” New York Times, April 18, 1912, 16.

110 “Nitrate Supply for Government Use is Urged,” Christian Science Monitor, September 29, 1916, 6.

111 “Stanley is Given New Seaboard Job,” Atlanta Constitution, October 26, 1916, 7.

112 Ibid.

113 “S.A.L. Offices Will be Moved to Atlanta Dec. 1,” Atlanta Constitution, November 22, 1916.

114 “Positions Vacant,” Electric Railway Journal, November 18, 1916, 53.

115 “Business Opportunity,” Wall Street Journal, January 30, 1917, 8.

116 “Situations Wanted—Male,” New York Times, May 19, 1918, 41.

117 “Notes,” The Dial: A Semi-Monthly Journal of Literary Criticism, January 16, 1905, 53; “Review,” New York Observer and Chronicle, August 31, 1905, 277; “Book Department,” Annals of the American Academy of Political and Social Science 25 (1905), 344.

118 Albert Shaw, The Business Career in its Public Relations (San Francisco: Paul Elder and Company, 1904). http://www.gutenberg.org/files/29641/29641-h/29641-h.htm (accessed November 7, 2013).

119 Shaw, The Business Career in its Public Relations.

120 Willard Hotchkiss, “The Northwestern University School of Commerce,” Journal of Political Economy 21 (1913): 206.

121 Ibid.

122 Campbell, “Why Would Corporations Behave in Social Responsible Ways?;” Scott, “Approaching Adulthood.”

123 Bernays, Public Relations, Cutlip, Public Relations History from the 17th to the 20th Century: The Antecedents.

Additional information

Notes on contributors

Cayce Myers

Cayce Myers is an associate professor in the Department of Communication at Virginia Tech University. He is the author of numerous articles on the history of public relations.