The Bipartisan Campaign Reform Act of 2003, also known as “BCRA” or “McCain-Feingold”, put restrictions on unions and corporations and the independent expenditures they could make if the funds came from the general treasury:
No “electioneering communication,” defined as “any broadcast, cable, or satellite communication” that “refers to a clearly identified candidate for Federal office” that is “publicly distributed” within 30 days of a primary election
No speech that expressly advocates for a candidate’s election or defeat
If a union or corporation wanted to do this, it had to set up a separate political action committee (PAC), that is typically funded by individuals within the union or corporation.
An “independent expenditure” is money spent by groups or individuals that are not controlled by a candidate (such as his or her campaign committee).
Citizens United is a nonprofit corporation created under Section 501(c)(4) of the Internal Revenue Code. Citizens United wanted to run television commercials to advertise their documentary that negatively portrayed then-candidate for president Senator Hillary Clinton within 30 days of a primary. The group asked for a court order that said it would be able to run the commercials and stop the Federal Election Commission (FEC) from finding it in violation of BCRA. After many decisions and appeals, the case made it to the United States Supreme Court.
Supreme Court Opinion
The Supreme Court’s opinion said several things, but the key takeaways were that a union or corporation:
Can make independent expenditures from its general treasury without creating a PAC. The court held that the BCRA section that banned this political speech violated the First Amendment.
Must still publicly disclose its identity if it sponsored an advertisement.
Cannot directly donate to a candidate or candidate’s committee.