January 4, 2012
Montana Supreme Court Upholds Campaign Spending Limits for Corporations
The Montana Supreme Court last week upheld state campaign spending limitations on corporations against a free speech challenge under Citizens United v. FEC. The court ruled that special circumstances distinguish the case from Citizens United, and that unique features of Montana politics justify the restrictions, even under strict scrutiny.
The statute under attack in Western Tradition Partnership v. Attorney General prohibits corporations from spending "in connection with" a candidate or a political committee, but it allows corporations to establish an independent political action committee for that purpose. It says:
(1) A corporation may not make a contribution or an expenditure in connection with a candidate or a political committee that supports or opposes a candidate or a political party.
(2) A person, candidate or political committee may not accept or receive a corporate contribution described in subsection (1).
(3) This section does not prohibit the establishment or administration of a separate segregated fund to be used for making political contributions or expenditures if the fund consists only of voluntary contributions solicited from an individual who is a shareholder, employee or member of the corporation.
Montana Code, Sec. 13-35-227.
Three corporations challenged the law: a sole proprietor; a firearm safety and gun-rights group; and a shell corporation designed to influence Montana politics while concealing the identity of contributors.
The court ruled that three things distinguished this challenge from Citizens United. First, the court ruled that the PAC requirement was not onerous, especially for these three plaintiffs, who failed to show that their political spending was at all impacted by it. Next, the court said that Montana campaign spending regulations are far less onerous than federal regs and, again, did not deter or impact these plaintiffs' spending. And finally, the court wrote at length than Montana has a unique history of powerful corporations, controlled by outsiders, directing and corrupting the politics of the State.
The court said that the spending restriction was narrowly tailored to meet the compelling interest of reducing corruption by corporations in the State, given the unusual features of Montana politics and its economy, thus satisfying strict scrutiny:
Issues of corporate influence, sparse population, dependence upon agriculture and extractive resource development, location as a transporation corridor, and low campaign costs make Montana especially vulnerable to continued efforts of corporate control to the detriment of democracy and the republican form of government.
Op. at 22.
The court said the state also had an interest in the full political participation of its electorate:
With the infusion of unlimited corporate money in support of or opposition to a targeted candidate, the average citizen candidate would be unable to compete against the corporate-sponsored candidate, and Montana citizens, who for over 100 years have made their modest election contributions meaningfully count would be effectively shut out of the process.
Op. at 23-24.
Finally, the court said that the State had compelling interests in preserving its system of elected judges, and in an independent, fair, and impartial judiciary that are served by the statute.
Because the law satisfied strict scrutiny, the court held, it also satisfied lesser scrutiny applicable to the sole proprietor and to the firearms group, whose speech was not sufficiently burdened by the law to justify strict scrutiny review.
Justices Baker and Nelson dissented, arguing that Citizens United prohibits all bans on corporate campaign spending. Justice Baker argued further that State election authorities could constitutionally extend disclosure requirements to corporations; that, at least, would give Montana voters some protection against corruption (through disclosure), if the Supreme Court were ultimately to overturn Montana's spending restriction.
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