District Court Ignores Supreme Court Precedent to Strike Down Corporate Contribution Ban

In a clearly erroneous ruling, a federal district court in Virginia yesterday declared unconstitutional the federal restriction on direct corporate contributions to candidates and political parties.  This decision in effect attempts to overrule a standing Supreme Court precedent, FEC v. Beaumont, which upheld the same federal corporate contribution ban eight years ago.

The case, U.S. v. Danielczyk, is a criminal matter concerning a number of alleged campaign finance violations, including that the defendants illegally directed corporate contributions to Hillary Clinton’s 2008 Presidential campaign.  The district court found that the reasoning of Supreme Court’s 2010 decision inCitizens United v. FEC implicitly undercut the constitutional basis of the federal restriction on corporate contributions, and on these grounds, struck down the corporate contribution ban.  The district court failed to cite FEC v. Beaumont, the governing Supreme Court precedent on the challenged law.

“This decision is way out of line,” Legal Center Associate Legal Counsel Tara Malloy stated, “To attempt to overrule a standing Supreme Court decision without even mentioning that decision is a ridiculous overreach.  A district court has no authority to ignore a controlling Supreme Court precedent.”

The Supreme Court decision in Citizens United reviewed the federal restriction on corporate independent expenditures.  The Court did not consider the century-old restriction on corporate contributions, noting explicitly that “Citizens United has not made direct contributions to candidates, and it is not suggested that the Court should reconsider whether contribution limits should be subjected to rigorous First Amendment scrutiny.”  Furthermore, the Supreme Court did not discuss its earlierBeaumont decision in any detail in Citizens United, much less criticize or overrule the decision.

“We hope that the Judge James Cacheris reconsiders this decision,” Ms. Malloy said.  “If not, the government should appeal this decision to the Fourth Circuit Court of Appeals.”