On September 31, 2026, the U.S. District Court for the District of Maine ruled on a motion for judgment on the pleadings, filed by the corporate plaintiffs who are seeking to block Maine’s ban on foreign government-influenced corporate political spending. The judge partially granted this motion, permanently blocking important parts of the law law but leaving some parts of the law in place (albeit still temporarily blocked by the court’s prior preliminary injunction order). While Free Speech For People applauds the District Court for properly recognizing Maine’s interest in regulating foreign corporate spending, the ruling misconstrued key Supreme Court precedent and made incorrect factual conclusions on matters that should have been analyzed only with the benefit of discovery and trial. As a result of this ruling, foreign government-influenced corporations will be able to spend freely in Maine’s elections, a ruling that stands contrary to the Constitution and to the will of 86% of Maine voters, who voted in favor of the law via a 2023 ballot measure. 

Background

In 2023, Maine voters passed a ballot initiative that, in relevant part, banned “foreign government-influenced entities” (FGIEs) from making contributions or expenditures to influence candidate elections or referenda. FGIEs include (1) foreign governments; (2) corporations in which foreign governments or entities in which foreign governments have a majority share hold at least 5% ownership; and (3) corporations whose decision-making is directed by or participated in by foreign governments or entities in which foreign governments have a majority share. Several corporate defendants have challenged the law.

The Federal District Court of Maine Correctly Recognized the State’s Interest in Protecting Maine Elections from Foreign Influence 

The District Court correctly ruled that Maine has a compelling interest in “limiting participation and the appearance of participation by foreign governments in activities intimately related to the process of the state’s democratic self-government, including the spending of money to influence voters or finance campaigns.” In reaching this decision, the Court correctly relied on Bluman v. FEC, a decision authored by then-Judge (now Justice) Kavanaugh on behalf of a three-judge district court panel, and summarily affirmed by the Supreme Court in 2011. The Court in Bluman, which upheld a federal law prohibiting foreign nationals from spending any money either “directly or indirectly” in U.S. elections, determined that states have a legitimate interest in “limiting the participation of foreign citizens in activities of American democratic self-government, and in thereby preventing foreign influence over the political process.” The Court also correctly distinguished the facts of this case from those at issue in Citizens United v. FEC. There, the Supreme Court ruled that corporations could spend money on U.S. elections on the theory that they derive First Amendment rights from their status as “associations of citizens.” Foreign government-influenced corporations are not such associations. 

Because Maine has a legitimate state interest in protecting its democratic self-government, the District Court correctly upheld the provision of the Maine law banning foreign governments and corporations whose decision-making is directed by foreign governments or entities in which foreign governments own a majority of the shares from spending in connection with Maine elections and referenda. As the District Court cautioned, absent this law, “[f]oreign governments lacking First Amendment protections could use their resources to purchase enough shares of a corporation (or many small corporations) with some American shareholders to effectively control their decisions to spend money in U.S. elections and thus improperly participate in internal democratic governance.”

The District Court also upheld the media disclosure and due diligence provisions of the law, which are unique to Maine’s law and are not part of other foreign-influence corporate political spending laws championed by FSFP. 

The District Court for the District of Maine Incorrectly Applied Supreme Court Precedent to the 5% Threshold and the “Participation” Requirement

In opposing the motions for judgment on the pleadings, the defendants opted to not defend the law’s 5% threshold provision against the plaintiff’s challenge to its constitutionality. However, Free Speech For People, as amicus curiae, defended the provision, arguing that corporations owned in significant part by noncitizens and foreign governments can be regulated under the rationale of Bluman, and explained why even a 1% threshold is constitutional. As Maine voters—as well as the SEC and business experts—recognize, only a handful of owners hold more than 1% or 5% stake in most publicly traded corporations. These owners—whose stakes are worth millions—wield significant direct and indirect influence over the corporations.   

However, the District Court ruled, without explanation, that the 5% threshold was too low to be constitutional under the First Circuit’s “implicit” reasoning in a previous opinion. This ruling does not take into account well established corporate law; and is a factual determination that should at the very least not be resolved against the defendants prior to discovery and trial. Mainers are entitled to establish reasonable standards, as they have done here, to prevent foreign influence over their democratic process.

Similarly, the court struck down the “participation” provision described above. The Court reasoned that the law would ban expenditures by a corporation wholly owned by American citizens if they conferred with a foreign government about their election spending decisions. It does; and Mainers are wholly entitled, under the Constitution, to place such limits on outlets for foreign influence over Maine’s elections. Citizens would be rightfully worried if Nvidia—which has a large potential customer base of Chinese companies—asked the Chinese government which candidates it should support in upcoming elections and then spent money on candidates or ballot measures that the Chinese government favors. Individual states and the federal government can lawfully prevent this type of obvious foreign influence on the democratic process. 

Mainers Deserve Careful Consideration of its Law After Robust Fact Development. 

The District Court’s opinion is not a final determination. The case will go on to the discovery phase where Maine will be entitled to robust fact development. Free Speech For People will continue to support Maine and its defense of this critically important law, so that the state can preserve its democratic self-government. 

Read the District Court’s decision here.

Read Free Speech For People’s amicus brief here. 

To learn more about this case, visit our case page.