The United States Court of Appeals for the Second Circuit has handed Connecticut a partial victory in its efforts to address the potentially corrupting influence of campaign contributions by contractors and lobbyists in the state.  The Second Circuit has upheld Connecticut’s “pay to play” law insofar as it imposes a complete ban on campaign contributions both by contractors that have business pending with the State and by their principals and close family members.  On the other hand, the Second Circuit ruled that the portions of the law banning campaign contributions by lobbyists and prohibiting lobbyists and contractors from soliciting campaign contributions were so broad as to violate the First Amendment’s free speech protections.  We summarize the decision, which could provide valuable insight into how courts might address similar challenges to other “pay to play” laws, such as the SEC’s new Rule 206(4)-5, which affects investment advisers.  See “Key Elements of a Pay-to-Play Compliance Program for Hedge Fund Managers,” above, in this issue of the Hedge Fund Law Report.