Lawsuit could limit campaign contributions by LLCs

If complaint succeeds, entities would be identified with their owners
August 27, 2015 02:05PM

Corporations are “people,” and they’re the kinds of people who give a lot of money to politicians. But if a new lawsuit winding its way through state courts succeeds, only the actual, human people behind the corporations will be allowed to play.

Risa Sugarman, enforcement counsel for the state Board of Elections filed suit against the Shirley Patterson campaign, alleging it accepted contributions above the legal limit, then $4,100.

What’s most notable is that Sugarman’s suit treats donations by LLCs as equivalent to contributions by the people who control them. The LLCs, she suggests, are simply the human beings’ “alter egos,” and not distinct entities subject to their own limits, Politico reported.

If the suit’s logic passes muster, it could reduce the total donations of hundreds of prominent donors who utilize LLCs to increase their impact.

Glenwood Management famously utilized multiple LLCs to donate $3.6 million to various New York candidates in 2014, including $1 million to Gov. Andrew Cuomo’s campaign.

Earlier this year, Glenwood’s CEO Leonard Litwin was named as a party in the corruption cases against former Assembly Speaker Sheldon Silver and former State Senate Majority Leader Dean Skelos. [Politico]Ariel Stulberg