Va. federal judge rejects government request to reconsider on donations

A judge in Virginia on Tuesday affirmed his ruling that the federal ban on direct corporate contributions to political candidates is unconstitutional, turning down the government’s request that he reconsider.

U.S. District Judge James Cacheris said in the new opinion that it applies only to the case at issue, involving two men accused of making illegal donations to the 2006 Senate and 2008 presidential campaigns of Secretary of State Hillary Rodham Clinton (D).

But Cacheris rejected the government’s arguments that the Supreme Court’s 2010 decision in Citizens United v. Federal Election Commission only freed corporations and unions to make independent expenditures on behalf of candidates.

“If corporations and individuals have equal political speech rights, then they must have equal direct donation rights,” Cacheris wrote.

The case is not a challenge to campaign finance rules; Cacheris’s rulings came in a motion to dismiss criminal charges involving alleged illegal contributions.

Cacheris’s original ruling in the case drew criticism from those favoring strict campaign finance laws because it did not reference what they and the government believe to be the controlling Supreme Court precedent in the field.

That is a 2003 decision, Beaumont v. Federal Election Commission , which upheld a ban on direct corporate contributions. Cacheris acknowledged in his new ruling that Citizens United did not overturn Beaumont but said it didn’t apply to the case at hand.

Beaumont, Cacheris said, involved a nonprofit corporation, while the corporation in the Virginia case is a for-profit one.

Cacheris struck one of the charges against William Danielczyk, chairman of the Northern Virginia-based Galen Capital Group, and Eugene Biagi, a Galen executive. The two are charged with illegally reimbursing people for nearly $200,000 in contributions to Clinton for her U.S. Senate and presidential races. There is no allegation that Clinton was aware of the activities.

Campaign finance law advocates said Cacheris’s distinctions between for-profit and nonprofit corporations was not the correct reading of Beaumont.

“This is quite an extraordinary and misguided decision,” said Fred Wertheimer, president of Democracy 21. “Judge Cacheris simply does not have the power or authority to do this.”

The government had argued that the court’s controversial 5 to 4 ruling in Citizens United concerned only independent expenditures, not direct contributions; comparing the two was like trying to equate “apples and oranges.”

But Cacheris had a different interpretation of the ruling.

“Taken seriously, Citizens United requires that corporations and individuals be afforded equal rights to political speech, unqualified,” he wrote, adding that “individuals and corporations must have equal rights to engage in both independent expenditures and direct contributions. They must have the same rights to both the ‘apple’ and the ‘orange.’ ”

Cacheris, who was appointed by President Ronald Reagan and moved to senior status in 1998, acknowledged that other courts considering the constitutionality of the corporate contribution ban in light of Citizens United have ruled that Beaumont still controls.

The next step for the government would be to appeal the decision to the U.S. Court of Appeals for the 4th Circuit in Richmond. A spokesman for the U.S. attorney’s office in Alexandria said only that its lawyers were reviewing the decision.

Robert Barnes has been a Washington Post reporter and editor since 1987. He has covered the Supreme Court since November 2006.
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