Supreme Court Rules Corporations Can Spend in State Elections

By: - June 25, 2012 12:00 am

The U.S. Supreme Court on Monday squelched a Montana uprising against its landmark 2010 campaign finance decision and, in doing so, affirmed that states can’t forbid corporations from spending money to influence elections.

In the 2010 decision, Citizens United v. Federal Election Commission, the Court held that preventing corporations from engaging in campaign spending violated the free speech protections in the Constitution’s 1st Amendment. The justices authorized corporations to make independent campaign expenditures, although it didn’t give them the power to contribute money directly to candidates.

Despite that decision, the Montana Supreme Court upheld the state’s ban on corporate campaign spending in late December. The Montana court based its ruling on the state’s history of crooked politics prior to the 1912 ban, referring to a time mining interests exerted tremendous power in the state. Citizens United, the Montana court argued, still gave states the power to forbid corporate political spending if the proof of the corrupting influence of the spending was strong enough.

Three corporations appealed the case to the U.S. Supreme Court, asking them to overturn the Montana law. That’s just what the Court did Monday in a 5-4 ruling. The same five justices who were in the majority on Citizens United—John Roberts, Antonin Scalia, Anthony Kennedy, Clarence Thomas and Samuel Alito — the Court’s conservative wing — once again made up the majority in the case, American Tradition Partnership, Inc. v. Bullock.

The Montana decision was “summarily reversed,” meaning the Supreme Court acted without going through the full process of briefs and oral arguments. Instead, it agreed to take the case and then decided it at the same time. “Montana’s arguments in support of the judgment below either were already rejected in Citizens United, or fail to meaningfully distinguish that case,” the majority wrote in an unsigned opinion. The ruling was a rebuke not only to Montana, but also to 22 other states that had written a brief specifically asking the Court not to reverse the Montana decision without allowing for arguments that state and local elections should have different rules than federal elections.

The dissenting opinion was written by Justice Stephen Breyer and joined by the Court’s entire liberal wing. In it, Breyer argued that his preference was to reconsider the Citizens United decision, but, failing that, he would have simply let Montana’s law stand. “Montana’s experience, like considerable experience elsewhere since the Court’s decision in Citizens United,” Breyer wrote, “casts grave doubt on the Court’s supposition that independent expenditures do not corrupt or appear to do so.”

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Josh Goodman

Josh Goodman helps lead research on fiscal management and place-based economic development programs as part of Pew’s state fiscal health project. Goodman has served as a primary author for Pew studies that examine how states should evaluate tax incentives and maintain budget discipline when implementing those incentives.