Federal Judge Rules Corporations, Just Like People, Should Be Able To Give To Candidates

May 27, 2011 9:45 a.m.

Last year the Supreme Court’s ruling in Citizens United opened up the coffers of political action groups to corporate funds because the court found that companies — just like people — should be able to donate to political causes. Now a federal judge has ruled that based on that logic, corporations should be able to give directly to politicians just like human beings.

Federal Judge James C. Cacheris, who was nominated to the federal bench in the Eastern District of Virginia by President Ronald Reagan back in 1981, ruled that “for better or worse, Citizens United held that there is no distinction between an individual and a corporation with respect to political speech.”

“Thus, if an individual can make direct contributions within [the law’s] limits, a corporation cannot be banned from doing the same thing,” Cacheris wrote in a ruling issued late Thursday.

The ruling came about in a criminal case against two men who were accused of illegally reimbursing donors to Hillary Clinton’s Senate and presidential campaigns. William Danielczyk and Eugene Biagi were charged in February for allegedly paying back $186,600 in contributions, and allegedly “created and distributed back-dated letters to 15 contributors that falsely characterized reimbursements for contributions as ‘consulting fees’,” according to the Justice Department.

Danielczyk was a “bundler” for Clinton who allegedly reimbursed employees of his private-equity firm Galen Capital for the donations they made to Clinton at a fund-raising event at Clinton’s D.C. home back in 2007. The indictment alleged that Danielczyk and Biagi used corporate funds to contribute to Clinton’s presidential campaign.

Cacheris’ ruling denies the defense motion to dismiss additional charges, but it does find that charges against the pair for using corporate money are unconstitutional.

“If human beings can make direct campaign contributions within FECA’s limits without risking quid pro quo corruption or its appearance, and if, in Citizens United‘s interpretation of Bellotti, corporations and human beings are entitled to equal political speech rights, then corporations must also be able to contribute within FECA’s limits,” Cacheris wrote.

“Importantly, this finding hardly gives corporations a blank check (so to speak) to directly contribute unlimited amounts to federal campaigns,” Cacheris wrote in his 52-page ruling. “Rather, corporations are subject to the same FECA contribution limits as individuals.”

Federal prosecutor Mark Lytle argued that ruling to toss out the charges “would have the court throw out a century of jurisprudence upholding the ban on corporate political contributions, by equating expenditures — which the Court struck down in Citizens United — with contributions. This is, however, equating apples and oranges.”

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