Federal Court Strikes Down Pennsylvania’s Ban on Political Contributions from Casino Interests

By Samantha Haggerty

Samantha Haggerty

Yesterday, the District Court for the Middle District of Pennsylvania struck down Section 1513 of the Pennsylvania Gaming Act, 4 Pa. C.S. § 1513, as unconstitutional under the United States Constitution. Section 1513 prohibits gaming license applicants, licensees, and principals of licensees from making any political contributions. Judge Sylvia H. Rambo of the Middle District applied the modified intermediate scrutiny analysis applicable to restrictions on direct campaign contributions under the First Amendment to determine that, although Pennsylvania demonstrated a sufficiently important interest in preventing quid pro quo corruption or the appearance of such corruption, the Commonwealth failed to craft legislation that was closely drawn to achieve that important interest.

The provision was previously challenged under the Pennsylvania state Constitution in DePaul v. Commonwealth of Pennsylvania, and was held to be unconstitutional under the Pennsylvania Constitution in 2009. The Pennsylvania legislature amended the legislative purpose of the Gaming Act in response to that decision and expressly included the Commonwealth’s compelling interest in preventing corruption by those involved in the gaming industry. The amendment, however, was not enough to convince the federal court that Section 1513 is constitutional. Judge Rambo stated in her memorandum opinion that “Section 1513 goes far beyond the legitimate purpose of preventing corruption or the appearance of corruption” and that it stifles casino interests’ rights to participate in the election process by making political contributions.

The decision may be a hollow victory for the gaming industry, however, as the court suggests the Pennsylvania legislature amend Section 1513 to create a more narrowly tailored restriction on casino licensees’ political contributions. The court’s opinion proposes the legislature more strictly define who is subject to the ban, limiting its purview to those with close connections to the gaming industry; or, in the alternative, create a limit on aggregate contributions in order to prevent corruption. It remains to be seen how the Pennsylvania legislature will react to the court’s decision.