This is the 28th in a series of brief articles that Moye White is sending to its clients and friends to provide practical insight about the opportunities & challenges in today's world.
In a landmark ruling last Thursday, the U.S. Supreme Court held that the ban on the use of corporate funds to pay for advertisements in a campaign for federal office violates the First Amendment right to free speech. The Court's decision in Citizens United v. F.E.C. has caused much discussion and debate over the role of corporate money in political campaigns and will have an immediate effect on the upcoming November elections. Corporations, labor unions, and interest groups are now allowed to spend unlimited amounts of money on media in support of or opposition against candidates for federal office so long as they do not coordinate their message with the candidate's campaign. While the ruling in Citizens United looked only at the federal prohibition on corporate expenditures, it is likely that state prohibitions of corporate spending on media in state campaigns will be affected as well. In Colorado efforts are underway by some to use the Citizens United ruling to eliminate many of the corporate campaign finance restrictions in place.
What does the Supreme Court's ruling mean for corporations interested in participating in the upcoming 2010 election cycle? Corporations are still prohibited from making direct contributions to a candidate's campaign for federal office. Similarly, the Supreme Court's ruling has done nothing to overturn Colorado's ban on corporate contributions to a candidate's campaign for state office. What the ruling in Citizens United does do, is provide corporations the opportunity to spend corporate dollars on media and messages in support of or against a candidate. Additionally, corporations that choose to spend money on media in support of or opposition against a candidate are still required to comply with disclosure requirements under federal law.
Immediately after the Court's announcement in Citizens United, members of Congress began calling for legislation to limit corporate campaign media expenditures. It is expected that legislation soon will follow that places restrictions on the amount that corporations may make on these expenditures.
Moye White counsels clients regarding the formation of political committees in Colorado and related corporate campaign finance matters. We have assisted corporate clients in forming employee PACs, advised on contributions to parties, candidates and issue committees, and have answered general corporate campaign finance questions.
For more information contact: Ted White at (303) 292-2900.
Moye White LLP has prepared this bulletin to provide general information; however this bulletin does not provide legal advice and does not create an attorney-client relationship between the reader and Moye White. No legal or business decision should be based solely on the content of this bulletin.