Amid the excitement over last week’s health care decision, the Fourth Circuit’s major campaign finance decision in a case called United States v. Danielczyk received relatively little attention. However, Danielczyk is a crucially important case, affirming the constitutionality of a longstanding federal law banning corporations from giving campaign donations directly to candidates. The opinion overturned a flawed lower court decision — and limited the reach of Citizens United. The federal ban on corporate contributions, now located in the Bipartisan Campaign Finance Reform Act, has been in force since Congress passed the Tillman Act in 1907. For more than a century, it has been one of the core protections against corruption in our democracy.
The Danielczyk case began when two businessmen gave corporate money directly to Hillary Clinton’s 2008 presidential campaign. During their trial, they argued that after Citizens United, the ban on corporate campaign contributions is unconstitutional. In effect, they urged the court to find that Citizens United invalidated the Supreme Court’s 2003 decision in F.E.C. v. Beaumont, which recently decided that the very same ban was constitutional.
While the lower court wrongly accepted this argument, the Fourth Circuit found that Citizen United’s reasoning is limited to independent expenditures — the Citizens United Court expressly declined to disturb any laws governing direct contributions. Circuit Judge Gregory, writing for a three-judge panel, refuted the proposition that the “‘corporations-are-equal-to-people’ logic necessarily applies in the context of direct contributions.” In other words, nothing about Citizens United weakens Beaumont’s holding that the government can ban corporate campaign contributions in order to prevent corruption and stop violations of other campaign finance laws.