If we use the "Add tags" option in the email campaign settings. The tag is not applied to a contact, if there is a special character in the email campaign name, and we have the have the UTM parameter "Campaign (utm_campaign)" enabled and select "Campaign name (send date)" / "Campaign name" / or "Campaign name (campaign id)."
The underlying issue is that special characters in our campaign names are not being properly encoded for use in a URL. So all the UTM tracking as well as the tagging breaks if a campaign name includes certain characters that are unsafe to include in a URL. The email campaign I had this problem with had a "&" in the name, which is why it broke.
Any user-added text that HL will be putting into a URL (e.g. email campaign names or custom UTM parameters) need to go through a validation & encoding step to make sure that the resulting URL meets current software standards for a valid & safe URL. (This includes things like replacing spaces with hyphens as well as encoding other special characters).