The District Court in New Mexico that struck down a municipal ban on corporate contributions broke away from other courts that, confronting the question, resolved it the other way under the Supreme Court’s decision in Beaumont. Giant Cab Company v. Bailey, No. 13-cv-00426 (D.N.M filed May 6, 2013); Federal Election Commission v. Beaumont, 539 U.S. 146 (2003). Rick Hasen is confident that Beaumont assures reversal if the case proceeds on appeal (which it may not). Maybe so; but the New Mexico case and perhaps others to follow put in question Beaumont as controlling authority for absolute prohibitions on corporate contributions. In the wake of Citizens United, the outcome remains unclear.

Reading Beaumont today, one is struck by a jurisprudence that measures up poorly to the tone and substance of Citizens United. Yes, Beaumont is a case about contributions, rather than expenditures, but in an opinion in Citizens that ranged over different rationales, Justice Souter for the majority upheld a contributions ban with emphasis on the “special characteristics of the corporate structure.” Id. at 153, quoting National Right to Work Committee v. Federal Election Commission, 457 U.S. 197 at 209 (1982). Ten times, Souter cited Austin v. Michigan Chamber of Commerce, 494 U.S. 652 (1990), overruled by Citizens United, and in upholding legislative authority to impose a complete contributions ban, he specifically cites the anti-distortion rationale of Austin that the Citizens United majority has rejected. Beaumont at 158 (the corporations enjoying the “special benefits conferred by the corporate structure… present the potential for distorting the political process.”) Souter also relied heavily on National Right to Work Committee, which rested largely on a view of the particular dangers posed by corporations of any and all sizes to the political process. Beaumont at 156 (“National Right to Work all but decided the issue” before the Court).

This Beaumont analysis that looked to the capacity of corporations to amass “political war chests…through the corporate form,” id. at 154, (quoting National Right to Work, 457 U.S. at 500-501), would seem to apply to all forms of corporate political spending—expenditures as well as contributions. And yet Citizens United established limits on the imposition of across-the-board restrictions based on corporate form. As Judge Armijo in the Giant Cab case noted, Citizens United had specifically rejected restrictions targeted at the identity of the speaker. Without evidence offered by the Council to support the vindication of other interests—preventing corruption, or the circumvention of individual contribution limits—the District Court would not rule out the possibility of a ban based on identity.

The New Mexico District Court did not conclude that an absolute ban on corporate contributions was impermissible. It found such a ban “neither novel nor implausible” in the light of the long history of the prohibitions on the books in many states and under federal law, Giant Cab at Para. 6. It stated only that if such a ban were imposed, it would have to be on the basis of some record, some evidence, that supported the City Council’s concern with corruption or the circumvention of individual contribution limits and its conclusion that “an absolute van on corporate contributions, rather than a contribution limit, was appropriate.” Id. para 15, 18. Once it was enough that the donor was a corporation. Now, the court held, Citizens United demands more, even if the legislature’s evidentiary burden is “comparatively light,” because the corporate form does not completely settle the question: it is no longer sufficient for the legislature to “single out corporate political speech for less favorable treatment based on the speaker’s corporate identity,” id. at paras 6, 18, particularly in the establishment of an absolute ban.

The Giant Cab opinion may prove to be wrong about the state of the law, but there is nothing certain about this outcome. Citizens United did, of course, distinguish contributions from expenditures, but when citing the corruption legislators could act to prevent, it referred to “large direct contributions,” 558 U.S. at 356 (emphasis added), and it pointedly noted that it not been asked to consider whether limits on contributions should be scrutinized as closely as those imposed on expenditures. Id. at 359.

Citizens United conferred on corporations a “speech” right to spend money to influence elections, and as the Court has affirmed in Buckley and beyond, contributions are speech—conducted by proxy, a few rungs down on the First Amendment ladder, but speech nonetheless. In absence of record evidence that any corporate contribution of any amount risks corruption or its appearance, a legislature is left to refer generally to the history of the corporate spending prohibitions and the public distrust of corporations. The Giant Cab court believed this to fall well short of the “quantum of empirical evidence” required to disallow any corporate contributions. Giant Cab at para 6., citing Nixon v. Shrink Missouri Gov’t PAC, 528 U.S. 377, 391 (2000).

The challenge the New Mexico court heard is not likely to be the last and the resolution may not be readily at hand in Beaumont.

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