In 1996 the Supreme Court adjudicated in Colorado Republican Federal Campaign Committee v. F.E.C., in which the Justices held that the provisions of the Federal Election Campaign Act were not applicable to political party expenditures which were not directly related to any candidate. The Republican Committee challenged in that case the coordinated expenditures restrictions, but the Court did not answer that question. The same issue was repeated by the Committee a few years later, leading to another lawsuit which again ended up in the Supreme Court. As a result, the same Justices answered the same legal question on the scope of the expenditure limits of political parties as imposed by the Federal Election Campaign Act.

The Court declared that restrictions on coordinated expenditures were constitutional as they served an important state interest, and did not violate political parties’ right to freely participate in election campaigns for federal offices. This time, however, the distribution of votes was 5–4, producing not only a narrow-margin decision, but also revealing a strong division among liberal and conservative Justices. Sandra Day O'Connor was the only conservative who supported the majority opinion, whereas such Justices as Anthony Kennedy, William Rehnquist, Antonin Scalia, and Clarence Thomas wrote dissenting opinions, in which they undermined the compelling state interest arguments, arguing for broader protection of the freedom of speech of political parties.

MR. JUSTICE SOUTER delivered the opinion of the Court