Federal District Court Strikes Down Ban on Direct Corporate Contributions to Candidates

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This is big news. A federal district court has struck down the ban on direct corporate contributions to candidates based on a reading of the Citizens United Supreme Court ruling. Here’s the story:

A ruling by a federal judge in Virginia makes it legal for corporations to contribute directly to candidates for federal office in a case likely to end up before the U.S. Supreme Court.

U.S. District Judge James C. Cacheris’ ruling, which does not immediately apply to Georgia, grants corporations the same rights as individuals to give directly to candidates.

The Supreme Court, in 2010’s Citizens United ruling, had previously said that corporations had a First Amendment right to make so-called independent expenditures to support a particular candidate, but it stopped short of granting them the ability to contribute directly to a candidate’s campaign. That ruling roiled campaign finance precedents and struck down key sections of the McCain-Feingold Act.

Cacheris’ ruling, which is likely to end up before the Supreme Court, only affects companies in his Alexandria, Va.-based district. But Doug Chalmers, founder of Atlanta-based Political Law Group and expert in campaign finance law, said if the high court upholds Cacheris’ decision, companies across the country would be allowed to contribute to candidates for the U.S. Senate and House.

“It would be a sea change in federal campaign finance law,” Chalmers told The Atlanta Journal-Constitution.

Rick Hasen doesn’t think the decision will stand:

I would expect this decision not to stand, or at least to be reconsidered by the judge. The United States Supreme Court in FEC v. Beaumont upheld a ban on corporate contributions in the case of FEC v. Beaumont, and the lower courts that have considered this question have all held that Citizens United did not overrule Beaumont on this question. The most recent case so holding is the Eighth Circuit’s opinion in MCCL v. Swanson, which I noted on the blog on May 16. (The district court in Danielczyk cites to the district court opinion in Swanson and seems unaware of the more recent opinion on appeal.)

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