D.C. Circuit Upholds Ban on Contractor Political Contributions

Steven D. Schwinn, John Marshall Law School

The full D.C. Circuit today upheld the federal ban on government contractor political contributions to candidates and parties. The ruling is a significant victory for campaign finance regulation, and rebuffs a direct challenge to the core of the Court's First Amendment rule on political contributions. At the same time, the case also sets up a challenge to that core for potential Supreme Court review. (We posted previously on the case here.)

The case, Wagner v. FEC, involves a narrow issue: whether the federal ban on contributions to a candidate or a political party by an individual federal contractor violates the First Amendment. The en banc D.C. Circuit unanimously said no. The court applied the familiar "lesser but still 'rigorous standard of review'" that governs restrictions on contributions, and held that the government's interests in (1) avoiding corruption and the appearance of corruption and (2) protection against interference with merit-based public administration supported the ban. The court also ruled that the ban was sufficiently well tailored, and neither unconstitutionally over-inclusive nor under-inclusive, with respect to the two government interests.

The court's lengthy opinion detailed the history of pay-to-play, government responses to the problem of contractor corruption, and current problems with corruption. The self-consciously thorough ruling appears written to insulate it as much as possible from reversal at the Supreme Court and thus underscores the importance of the case.

The plaintiffs framed the case narrowly to directly take on the current lower-level test for political contributions (as opposed to independent political expenditures), and set up a test case to overturn that portion of Buckley v. Valeo that says that government must justify restrictions on contributions at only a lower level of scrutiny under the First Amendment. While today's ruling rebuffed that effort, this is almost surely just a bump in the road for the plaintiffs on the way to the Supreme Court--and their effort to get the Court itself to disavow the lower level of scrutiny (and apply strict scrutiny to contractor contributions), or at least rule that the government's ban on contractor contributions is too sloppy to withstand a lower level of review. Either way, if the Court bites, this could represent a serious challenge to government regulation of political contributions.