Judicial Takebacks: Reagan Nominee Overlooked Supreme Court Ruling On Corporate Donations

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May 31, 2011 2:50 p.m.

Last week a federal judge nominated by President Ronald Reagan rocked the campaign finance world when he ruled that corporations could give directly to candidates. Now he’s signaled he might want a do over.James C. Cacheris of the Eastern District of Virginia indicated in an order issued Tuesday that he’s considering whether his ruling ignored Supreme Court rulings in 2003 (FEC v. Beaumont) and 1997 (Agostini v. Felton) which upheld the ban on corporate donations.

Cacheris requested that both federal prosecutors and lawyers representing two businessmen who allegedly reimbursed their employees’ donations to Hilary Clinton file briefings on his decision by 5 p.m. Wednesday. He wants the briefings to be less than 10-pages in length and has scheduled a court hearing for Friday morning.

The judge based his 52-page ruling last week on the Supreme Court’s more recent decision in the Citizens United case.

“For better or worse, Citizens United held that there is no distinction between an individual and a corporation with respect to political speech,” Cacheris had written. “Thus, if an individual can make direct contributions within [campaign finance] limits, a corporation cannot be banned from doing the same thing.”

But his decision appears to have ignored a 2003 Supreme Court opinion, written by Justice David Souter, which held that “applying the prohibition to nonprofit advocacy corporations is consistent with the First Amendment.”

Wrote Souter: “not only has the original ban on direct corporate contributions endured, but so have the original rationales for the law. In barring corporate earnings from conversion into political “war chests,” the ban was and is intended to “preven[t] corruption or the appearance of corruption.”

Rick Hasen, a professor at the University of California at Irvine, told the Wall Street Journal‘s Washington Wire that the order “means the judge is seriously considering reversing his ruling.”

“The federal ban on corporate contributions to candidates is likely to stand, unless and until the Supreme Court says otherwise,” Hasen said.

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