|
Supreme Court Overturns Ban on Political Spending
by Corporations and Unions
On January 21, 2010, the U.S.
Supreme Court, in a 5-4 decision, transformed how corporations and
labor unions may participate in federal elections. The Court
ruled that the government may not ban political spending by
corporations or unions in federal candidate elections.
The case involved a provision in
the McCain-Feingold Act which prohibits corporations and unions from
paying for the broadcast of "electioneering communications"
30 days before a primary election and 60 days before a general election.
The plaintiff, Citizens United, had produced an anti-Hillary Clinton
documentary which it wanted to air through a video-on-demand service
during the 2008 primary season. Citizens United also wanted to
run advertisements for the documentary on television.
Although the Court could have
decided the case on narrow grounds, it instead issued a sweeping
opinion overruling a 1990 decision and striking down, on First
Amendment grounds, decades-old limits on corporate and union spending
in federal elections. The practical effect of this decision could
be enormous, because corporations and unions are now free to use their
general treasury funds to make unlimited independent expenditures in
support of or in opposition to federal candidates.
The decision does not address
the federal ban on corporate and union contributions, nor does it
address state or local limitations on corporate contributions or
expenditures. Clearly, however, corporations and unions now will
have a more significant and direct role in federal elections, because
they no longer have to rely on political action committees for
communicating their political viewpoints.
Read
the Court's opinion on political spending by corporations and
unions. For further information, please contact the Business
Litigation group at Ice Miller LLP.
|
