Madison Center Brief Argues Federal Ban on Corporate Contributions Is Unconstitutional

James Madison Center for Free Speech
1 South 6th Street
Terre Haute, IN 47807-3510

Thursday, June 2, 2011
Contact: James Bopp, Jr.
Phone 812-232-2434; Fax 812-235-3685;

Madison Center Brief Argues Federal Ban on Corporate Contributions Is Unconstitutional

Yesterday the James Madison Center for Free Speech filed a brief in federal court supporting its decision that the federal ban on direct corporate contributions is unconstitutional. For years, corporations have been banned by federal law from making contributions to candidates for federal office. Instead, they must make contributions through a PAC with donations from their employees and officers. They are not allowed, however, to use their own corporate money to make contributions.

A recent Supreme Court case, Citizens United, ruled that a similar ban on corporate spending for political messages to support or oppose candidates was unconstitutional. The Supreme Court said in Citizens United two very important things: (1) bans on political speech are impermissible, and (2) the Government cannot discriminate against speech just because the speaker is a corporation.

Last week, a federal court in Virginia was asked to decide whether the Constitution allows the Government to ban corporate contributions to candidates. The court ruled that the logic of Citizens United required it to find the ban unconstitutional. It explained that Citizens United means that corporate speakers and human speakers must be treated the same. (Other Supreme Court cases have ruled that making a contribution is “political speech,” indicating support for a candidate). Since humans are allowed to “speak” by making contributions, the court said that corporate speakers must be allowed to do so as well. So the court ruled the federal ban unconstitutional.

On Tuesday of this week, the court asked the parties to the case to submit supplemental briefing addressing whether it ought to reconsider its decision in light of another Supreme Court case called Beaumont, which upheld the federal ban on contributions as it applied to nonprofit advocacy corporations. Simply put, the court had not addressed Beaumont in its decision, and so asked the parties to tell it whether it should or not. That spurred the Madison Center to ask the court’s permission to file its friend-of-the-court brief, to help the court with its decision.

The Madison Center explained in its brief that the court should not reconsider its decision, for two reasons. First, Beaumont ruled that when there are generally applicable contribution limits or bans, the Government does not have to exempt advocacy corporations. Beaumont did not consider, however, whether the ban itself was constitutional. Second, the case that is directly “on point,” and so controlling, is Citizens United. Because the court based its decision on Citizens United, its decision that the federal corporate contribution ban is unconstitutional was sound. The Madison Center therefore urged the court not to reconsider its decision, but rather let its decision stand declaring that the federal ban on corporate contributions is unconstitutional.

James Bopp, Jr., General Counsel for the Madison Center, explained, “The district court Judge correctly understood that the First Amendment does not permit the Government to decide which speakers can speak, and which must be silent. The First Amendment protects all speech, regardless of who the speaker is. We are hopeful that the Judge will decide that he made the right decision in declaring unconstitutional the federal ban on corporate contributions to candidates.”

The case is United States v. Danielczyk, No. 1:11cr85 (E.D. Vir. May 26, 2011). The Madison Center’s brief may be viewed here:

James Bopp, Jr. has a national federal and state election law practice. He is General Counsel for the James Madison Center for Free Speech and former Co-Chairman of the Election Law Subcommittee of the Federalist Society.