Breaking: Federal judge rules corporate donation bans unconstitutional

posted at 11:58 am on May 27, 2011 by Ed Morrissey

The reach of Citizens United v FEC just got longer, if only temporarily.  Relying on the controversial ruling, a federal judge in Virginia threw out part of an indictment against two men accused of secretly reimbursing donors to Hillary Clinton with corporate cash.  Judge James Cacheris ruled that Citizens United established that corporations have a right to donate to political campaigns, as well as to spend their own money:

A judge has ruled that the campaign finance law banning corporations from making contributions to federal candidates is unconstitutional. …

Cacheris says that under last year’s Citizens United Supreme Court case, corporations enjoy the same right as people to contribute to campaigns.

When Barack Obama accused the Supreme Court of overturning a century of precedent, he was very much incorrect.  Citizens United only addressed about a decade’s worth of precedent that forbade corporate spending on political advertising, not contributions to candidates.  Precedent prohibiting the latter does go back more than a century, however, and Cacheris’ decision would undo all of it, if upheld.

That’s a mighty big if, though.  The appellate court will almost certainly take a dim view of that kind of interpretation from Citizens United.  Either way, though, this issue will be on its way once more to the Supreme Court, which will have to decide whether to endorse this interpretation or to limit Citizens United to expenditures and exercise stare decisis on contributions.  I’d call this a long shot to be upheld on any level, but it will make for an important — and entertaining — debate.

Since people will undoubtedly wonder, Cacheris is a Reagan appointee from 1981 and has been a senior jurist on the circuit since 1998.

Update: Gabriel Malor agrees with my skepticism and makes a couple of great points in an e-mail:

I’m glad you note that this district judge decision is an outlier and a long-shot. It was only 2003 when the Supreme Court upheld 7-2 the corporate direct contributions ban. See FEC v. Beaumont.  It’s unlikely the Court has changed that determination, just because of Citizens United which involved a different issue. In fact, the Citizens United court explicitly passed on considering the idea.

HotAir readers might also note the unusual posture of the district court case. Unlike the typical challenge to federal election laws, this is a criminal case against Clinton fundraisers who are alleged to have violated federal elections laws. They’re raising as a defense the idea that the ban on direct corporate contributions is unconstitutional.

Update II: Aaron Worthing has much more in-depth analysis at Patterico, but he’s also skeptical that this will — or should be — upheld.

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Reversed on appeal, not taken up by the Supremes. Put money on it.

Reagan was a horrible judge of judges.

tommylotto on May 27, 2011 at 12:02 PM

I’d call this a long shot to be upheld on any level, but it will make for an important — and entertaining — debate.

Agreed. I think this was the wrong takeaway from Citizens United.

Abby Adams on May 27, 2011 at 12:03 PM

Corporations! They’re made of people! People!

lorien1973 on May 27, 2011 at 12:03 PM

If this ruling stays, the Sugar-Free Peeps Corporation will undoubtedly regain control of the government!

Weebork on May 27, 2011 at 12:04 PM

So, corporations will still be allowed to use their corporate assets to further political agendas and influence elections?

Why do I have the feeling the New York Times Corporation won’t be as pleased with that ruling as the rest of us are?

Bruce MacMahon on May 27, 2011 at 12:06 PM

Clinton, donors, cash. Whatever happened to Hu Flung-du, anyway?

Geee….I wonder what this is all about.

On the bright side, and this is without any knowledge of the case, it sounds like a Reagan appointee just put the libs in a cross-fire. Attack the ruling and risk implicating the Clintons in felony, or ignore it and be forced to shut up forever about corporate donations.

This is a classic fork in chess. Either way, you lose something important to you, libtards.

BobMbx on May 27, 2011 at 12:07 PM

Corporations! They’re made of people! People!

lorien1973 on May 27, 2011 at 12:03 PM

Evil people, Lorien. Evil people. /

joejm65 on May 27, 2011 at 12:10 PM

If this ruling stays, the Sugar-Free Peeps Corporation will undoubtedly regain control of the government!

Weebork on May 27, 2011 at 12:04 PM

Sugar-Free Peeps? The very definition of evil.

strictnein on May 27, 2011 at 12:13 PM

O/T…Hey Ed, how is Allah feeling?

csdeven on May 27, 2011 at 12:13 PM

I withhold all judgment until Resident HotAir Legal Scholar Crr6 tells me how to think about this./

portlandon on May 27, 2011 at 12:13 PM

How long until we get a video clip of Tim Robbins ranting about corporations sitting in their corporation buildings being all corporation-y?

teke184 on May 27, 2011 at 12:18 PM

He just handed the liberals a gift. This decision will be used to justify the executive order on contribution disclosure and other restrictions. And all for nothing because it will never survive an appeal.

Mark1971 on May 27, 2011 at 12:18 PM

I withhold all judgment until Resident HotAir Legal Scholar Crr6 tells me how to think about this./

portlandon on May 27, 2011 at 12:13 PM

Stick your head in the toilet and flush twice. It’ll save time.

CurtZHP on May 27, 2011 at 12:20 PM

Remember, this will apply to Unions as well. They faced the same restrictions on direct contributions to political campaigns that corporations did. No more.

Mark1971 on May 27, 2011 at 12:21 PM

So, corporations will still be allowed to use their corporate assets to further political agendas and influence elections?

Which means the stockholders might actually have to start paying attention and involving themselves in the corporations in which they own shares.

OMG!!! They might have to READ something and stop being so worried about Jersey Shore and American Idol!

oldleprechaun on May 27, 2011 at 12:21 PM

This is a classic fork in chess. Either way, you lose something important to you, libtards.

BobMbx on May 27, 2011 at 12:07 PM

+7%…!

Seven Percent Solution on May 27, 2011 at 12:22 PM

He just handed the liberals a gift. This decision will be used to justify the executive order on contribution disclosure and other restrictions

If it’s upheld which, as Ed points out, seems iffy.

Citizens United was about political communications and corporations being banned from using money to make political communications (within a certain time frame of an election et cetera).

This is about direct donations to a candidate which is much different. Or as I understand it has been treated differently by the courts.

Or I could be pulling stuff out of my nether regions and don’t know what the heck I’m talking about.

I’d choose (b).

SteveMG on May 27, 2011 at 12:23 PM

If it’s upheld which, as Ed points out, seems iffy.

The inevitability of it being overturned doesn’t matter. Liberals will still use it for their own propaganda purposes.

Mark1971 on May 27, 2011 at 12:26 PM

So can George Soros finally come out of the closet and openly set up his “Socialize America” Corporation and donate directly to Obama and the Democrats?

albill on May 27, 2011 at 12:31 PM

Do they mean evil corporations, or evil conservative corporations?

search4truth on May 27, 2011 at 12:38 PM

Reversed on appeal, not taken up by the Supremes. Put money on it.

[tommylotto on May 27, 2011 at 12:02 PM]

You suggesting the paperwork I’ve done so far to register Max Out Your Contribution to Candidate X, Inc. is going to be a waste of time?

Dusty on May 27, 2011 at 12:38 PM

Interesting comment on campaign contributions posted on another site:

My wager for the biggest scandal of all time for the Obama administration going to have to be the foreign money he received to vault him into the White House.

The only thing we have now is the circumstantial evidence – funds pumped into the Obama campaign for unknown sources and Obama’s conspicuous allegiance to foreign powers more than the US.

But somewhere down the road we will find out where all that money came from, maybe it won’t be in time for his impeachment, but Obama’s place in the history books won’t be a good one.

Insert witty screen name here on May 27, 2011 at 12:40 PM

Well, this turns Obama’s demagoguery on Citizens United into reality. Awesome.

ernesto on May 27, 2011 at 12:41 PM

Remember, this will apply to Unions as well. They faced the same restrictions on direct contributions to political campaigns that corporations did. No more.

Gee, no more Purple shirted -goons intimidating free citizens with threats of losing a finger or two?

Maybe the new black panthers or some other group of pro -Obama civilian army cronies will be called upon to fill the “bus em in to take them down,” gaps?

I don’t think the NBP have unionized yet.

Don L on May 27, 2011 at 12:42 PM

This is a classic fork in chess. Either way, you lose something important to you, libtards.

BobMbx on May 27, 2011 at 12:07 PM

My thots, exactly. ROFLOL

AH_C on May 27, 2011 at 12:43 PM

If corporations are treated as “people” for everything else–including criminal prosecutions–why shouldn’t they be able to make political donations. Remember, corporations are affected like all other “persons” when it comes to regulations that kill their profits and undermine their growth–that is, kill job creation. Finally, it is a sham that corporations can give money to “issue” campaigns and not individuals. It would be better to have the donations made directly and get rid of the sham…

I hope this interpretation is held

RedSoxNation on May 27, 2011 at 12:56 PM

I wonder if this judge would have reached the same decision if the money had been funneled into the Bush campaign?

rmgraha on May 27, 2011 at 12:57 PM

Interesting comment on campaign contributions posted on another site:

My wager for the biggest scandal of all time for the Obama administration going to have to be the foreign money he received to vault him into the White House.

The only thing we have now is the circumstantial evidence – funds pumped into the Obama campaign for unknown sources and Obama’s conspicuous allegiance to foreign powers more than the US.

But somewhere down the road we will find out where all that money came from, maybe it won’t be in time for his impeachment, but Obama’s place in the history books won’t be a good one.

Insert witty screen name here on May 27, 2011 at 12:40 PM

This could blow up and overtake little Bammie’s foreign contribution scandal: Where’s Tony Rezko?

FTA: “Simply put – Antoin ‘Tony’ Rezko is the only witness that can bury Blagojevich and the Chicago Political Thuggery Machine. Why is Fitzgerald holding back Rezko? What has been promised or implied to Fitzgerald as a ‘reward’ for Fitzgerald’s blatant sandbagging efforts?”

slickwillie2001 on May 27, 2011 at 12:57 PM

Some people ghave common sense. A gubment can make laws against a corporation but a corporation can’t speak and encourage people to vote for people that don’t want to punish business.

seven on May 27, 2011 at 12:57 PM

So, by this judge’s reasoning, campaign contribution limits are destined for the wastebin of history too — because a person can contribute through their own name as well as directly through a corporation they own.

If one views campaign contributions as an exercise in free speech, this seems well and good. But if one views very large campaign contributions as a means of buying a politician, not so good.

I’m on the fence.

unclesmrgol on May 27, 2011 at 1:02 PM

For ernesto: Womp womp

RedRedRice on May 27, 2011 at 1:04 PM

Reagan was a horrible judge of judges.

tommylotto on May 27, 2011 at 12:02 PM

In a few notable cases, it’s true — SDO’C, for example — but not generally. Remember that district judges are usually on recommendation of the state’s US senators of the same party as the president. Presidents rarely refuse the recommendations.

Attila (Pillage Idiot) on May 27, 2011 at 1:08 PM

[RedSoxNation on May 27, 2011 at 12:56 PM]

You are not being consistent nor are you addressing that the fact that corporations, in this instance, are using individuals employed by the corporation to make the donations as individuals, not as a single entity corporation.

This case is one of a corporation, defined as a single entity, evading the technical donation limit of $2,400 by having employees make the donations for them.

People are either individuals or members of a corporation. If the former, they have to use their own money and may each give $2,400. If the latter, they, as a grouped, single entity, can give only $2,400 of money.

Dusty on May 27, 2011 at 1:10 PM

ernesto on May 27, 2011 at 12:41 PM

I see you’re thinking with your tuckus again. You may want to stand up from time to time, and give it air.

capejasmine on May 27, 2011 at 1:13 PM

Unions spend unlimited amounts of money. While I’m not thrilled about corporations doing so as well, it’s better to have the two sides spending against each other than only have unions doing it.

angryed on May 27, 2011 at 1:59 PM

Interesting comment on campaign contributions posted on another site:

My wager for the biggest scandal of all time for the Obama administration going to have to be the foreign money he received to vault him into the White House.

This could blow up and overtake little Bammie’s foreign contribution scandal: Where’s Tony Rezko?

FTA: “Simply put – Antoin ‘Tony’ Rezko is the only witness that can bury Blagojevich and the Chicago Political Thuggery Machine. Why is Fitzgerald holding back Rezko? What has been promised or implied to Fitzgerald as a ‘reward’ for Fitzgerald’s blatant sandbagging efforts?”

slickwillie2001 on May 27, 2011 at 12:57 PM

It does bring up some interesting questions like how did Obama manage to garner all that campaign cash and why is he so beholding to foreign governments?

Insert witty screen name here on May 27, 2011 at 2:10 PM

This really isn’t that big a deal. It’ll get reversed, but even if it were upheld, corporate contributions to candidates would be limited to $2,500 under federal law.

crr6 on May 27, 2011 at 2:41 PM

Reagan was a horrible judge of judges.

tommylotto on May 27, 2011 at 12:02 PM

What about Antonin Scalia?

b1jetmech on May 27, 2011 at 3:37 PM

This really isn’t that big a deal. It’ll get reversed, but even if it were upheld, corporate contributions to candidates would be limited to $2,500 under federal law.

crr6 on May 27, 2011 at 2:41 PM

If it’s “no big deal”, why even have one of your Democrat Activist Judges try to reverse it in the first place? Just let it stand.

Del Dolemonte on May 27, 2011 at 5:52 PM

This really isn’t that big a deal. It’ll get reversed, but even if it were upheld, corporate contributions to candidates would be limited to $2,500 under federal law.

crr6 on May 27, 2011 at 2:41 PM

She shoots; SHE SCORES!

Finally, a cur6 post that I don’t vehemently disagree with. Will miracles never cease?

hillbillyjim on May 27, 2011 at 7:08 PM

If it’s “no big deal”, why even have one of your Democrat Activist Judges try to reverse it in the first place?
Del Dolemonte on May 27, 2011 at 5:52 PM

Well, because it’s wrong.

crr6 on May 27, 2011 at 7:57 PM