Returning to constitutional issues surrounding federal campaign money laws, the Supreme Court will be considering "“ in Davis v. Federal Election Commission (07-320) "“ a 2002 law that seeks to offset somewhat the advantage that candidates have when they are wealthy enough to pay for their own campaigns. At issue is the so-called "Millionaire's Amendment." The case, however, also includes an issue of whether the Court has jurisdiction to hear the appeal, thus raising the possibility that the Amendment's validity would not be resolved.

Background

As part of a massive political spending law "“ the Bipartisan Campaign Reform Act of 2002 "“ Congress inserted Section 319 as a way to correct what was believed to be an inequity that grew out of a 1971 Supreme Court decision (Buckley v. Valeo). In that ruling, the Court struck down an earlier law's cap on the amount of personal funds that a candidate could spend on his campaign "“ leaving wealthy candidates free to spend as much as they wanted to try to get elected. At the same time, the Court left intact strict limits on the amount of campaign contributions that a candidate could accept from others. That made it very difficult for candidates who had to raise money from others to compete with "millionaire" opponents. In Section 319, Congress relaxed the limits on contributions that a candidate could use if he or she was running against an opponent whose personal fortune was available for the campaign.

The Buckley decision struck down earlier provisions that put ceilings on spending of personal wealth: presidential and vice presidential candidates could only spend up to $50,000 of their own money, Senate candidates $35,000 and House candidates $25,000. The Court found those limited candidates' political speech rights in favor of his or her own candidacy. Buckley, however, upheld annual donation limits of $25,000 to candidates who depended on others for financing.

In a move to try to even up the competition, Congress in 2002 adopted what has come to be known as the "Millionaire's Amendment." A candidate planning to use personal funds during the campaign must publicly disclose, 15 days after becoming a candidate, if he or she plans to spend more than $350,000 of personal money. If the candidate exceeds that amount in actual spending, periodic reports are due with the Federal Election Commission, the opposing candidate(s), and with each opponent's national political party.

Any spending by that candidate of more than $350,000 operates to lift the law's contribution limits for candidates using other people's money. Each such opponent can gather up to three times the limit per donor that otherwise would be in place. (For the 2008 election cycle, that ceiling is $2,300.) An opponent also may seek and use money from donors who have already reached their ceiling (in 2008, $37,500) on donations, and may coordinate their spending plans with their political party so that the party can finance more of that candidate's campaign.

The constitutionality of the "Millionaire's Amendment" was challenged as part of the wide-ranging challenge to all of the 2002 campaign finance law, resulting in the Supreme Court's 2003 decision in McConnell v. FEC. The Court ruled there, however, that the challengers to this particular provision lacked the right to sue to bring their challenge, so it did not rule on the merits.

Before the Court in the new Davis case is a challenge that is limited in two ways: first, it is a challenge to the constitutionality of Section 319 as it was written (a "facial challenge") not as it actually worked in practice in a real campaign; and, second, it is a challenge only to the Amendment as it applies to wealthy candidates and their opponents running for seats in the U.S. House of Representatives. Comparable provisions of the Amendment as applied to the Senate are not at issue in the case.

The challenge here was filed by Jack Davis, a defeated Democratic nominee for a House seat from New York's 26th District "“ all or parts of seven counties in north western New York close to Lake Ontario. Davis ran unsuccessfully in the 2004 and 2006 general elections. After he filed for the race in 2006, planning to run again "“ as he did in 2004 "“ as a self-financed candidate, Davis filed his lawsuit challenging the Amendment. He contended that it violated his First Amendment political speech rights and his rights under the Fifth Amendment to equal protection. The case, as required by campaign finance law, went to a three-judge U.S. District Court in Washington, D.C. That Court rejected all of Davis' challenge. Under the law, Davis' appeal then had to go directly to the Supreme Court, bypassing a federal Court of Appeals. (Davis, while suing, went ahead with his campaign in 2006, and lost to Republican Rep. Thomas M. Reynolds in the general election.).

Jurisdictional Statement

Because Jack Davis' appeal to the Supreme Court is a direct appeal from a District Court, the appeal is in the form of a Jurisdictional Statement, rather than a petition for certiorari. In that form, the appeal requires the Court to hear the case unless it finds that it has no jurisdiction to do so, or it finds that it can dispose of it without full briefing an argument "“ that is, summarily.

Davis' appeal raised two questions: whether the "Millionaire's Amendment" violates the First or Fifth Amendment in attempting to "equalize resources" between House candidates, and whether, if that goal is a valid one, the specific financing provisions achieve that goal. In responding to the appeal, the Federal Election Commission told the Court that the case involves a third critical issue: did Davis have "standing" to bring his lawsuit? FEC contended that he did not, because he had identified no actual or imminent harm to his candidacy. Rep. Reynolds, it noted, did not receive any increased contributions or coordinated party spending under the Amendment, so there was no injury to Davis' campaign. The FEC also suggested that the case may be moot "“ another factor that could deny the Court jurisdiction.

The Supreme Court on Jan. 11 took on the case, but noted explicitly that it would not decide whether it had jurisdiction until it held a hearing on the merits. Thus, it will review the District Court ruling, but first must resolve the question of Davis' standing; if it finds that he had a right to sue, it would then move on to the merits, but not otherwise. (The District Court had ruled that David did have standing, saying that he would be harmed by Section 319's disclosure requirements and that would be corrected if the Amendment were struck down.

On the merits, Davis' basic point in the Jurisdictional Statement was that an attempt to equalize political resources among candidates is not aimed at reducing corruption in the federal election process, and, without that, Congress had no authority to pass Section 319. While contribution limits on candidates in general do help to head off the corrupting influence of money in politics, the appeal argued, there is no reason to believe that relaxing those limits would deal with any corruption problem. And, it added, personal funds for campaign are not corrupting in any sense, and, in fact, may offset the influence that moneyed groups have on national politics.

The FEC, in discussing the merits, argued that Davis' challenge raised "no substantial federal question," so the Court should dispose of it summarily, either by dismissing it for lack of such a question or by simply upholding the District Court ruling in favor of Section 319 on its face.

Analysis

The current Supreme Court is generally reluctant to strike down Congress' work on campaign finance when those laws are under review in facial challenges "“ that is, a challenge based solely on the language of the statutes. It has shown a tendency to believe that money in politics is something that Congress knows much better than the courts could, so the legislators' judgment generally is acceptable. It has, however, been less reluctant about nullifying a law once it has gone into effect, if it can see "“ in real world terms "“ that a campaign finance regulation inhibits political speech, or fails to deal with an identifiable problem of corruption in politics.

One major difficulty that Davis may encounter "“ both on his right to sue and on the merits of his claim "“ is trying to convince the Court that it is beyond Congress' authority to try to level the political playing field through campaign finance regulation. Most provisions in campaign finance laws, though aimed at supposed corrupting influences in politics, are intended to try to make money less the decisive factor in federal elections. Moreover, Section 319 put no limits on what Davis was allowed to spend; the provisions were intended, rather, to make it easier for him to be challenged when he uses his personal fortune. On the standing aspect of that issue, Davis must convince the Court that he is being penalized for spending his own money. And, on the merits, he must prove the same thing. Similarly, he has to shown that he was harmed by the disclosure requirements in Section 319; the Court is generally sympathetic with campaign laws that give voters more, not less, information about the candidates.

Merits Briefs

Lawyers for candidate Jack Davis, in their brief on the merits, open with a defense of his right to bring his challenge to the "Millionaire's Amendment." They argued that it is beside the point, in terms of judging whether Davis was harmed by the Amendment, that his successful opponent did not raise any extra funds to buttress his campaign for the House seat. He was injured, the brief contended, the moment he was required to disclose "sensitive, strategic information" about his campaign plans. Without the information that a self-financed candidate is obliged to make public, Davis contended, opponents would not be able to take advantage of the fund-raising allowances made by Section 319. The mere fact that the Amendment exists, he contended, means that he is less free to make personal expenditures without helping out an opponent. The brief also argued that the case is not moot, because the FEC still has pending an enforcement action against him for a failure to obey the law during the 2004 campaign.

On the merits, Davis' principal challenge is that Section 319 (which he contended is not properly called a "Millionaire's" provision because it is triggered well below that sum) was crafted in a way that favors incumbents and discourages new challengers. Self-financed candidates are discouraged from running and, if they run anyway, are punished by giving rewards to their opponents. On this point, he also argued that it does nothing to inhibit incumbent's use of "war chest" funds left over from earlier campaigns. In his own case, he said, the provision gave his opponent the option of raising an additional $1.4 million beyond normal limits, even though his opponent had already outspent Davis by more than $3 million dollars. That, he contended, is not leveling the playing field, even if that were a proper reason for campaign finance laws.

The Federal Election Commission, in its merits brief, again conceded that Davis did suffer an injury during the 2006 campaign because of the disclosure requirements of the Amendment, but it renewed its argument that the case has become moot nevertheless. He has not indicated any plan to run again, the FEC asserted, he cannot show he will again be injured. Moreover, it argued, he can raise his constitutional complaints during the ongoing FEC proceeding, and, besides, that proceeding may come to nothing in the end. He could bring an as-applied challenge later, the Commission noted. It also renewed its argument that Davis lacked standing to challenge to contribution provisions in Section 319, because his opponent in 2006 did not seek added money beyond the limits.

On the substantive issues Davis sought to raise, the FEC argued that Section 310 does not inhibit his political speech in any way, and allowed him to spend whatever he wished of his own money. Moreover, it added, "nothing in this Court's decisions supports [Davis'] contention that reducing wealth-based disparities inopportunity is an invalid government objective." Congress did not intend to abandon its basic purpose in campaign finance laws "“ inhibiting the corrupting influence of money in politics. "The perception that House and Senate seats may be bought and are the exclusive province of the rich are corrosive perceptions that Congress can seek to address," it contended.

The agency also dismissed as lacking in merit Davis' arguments that his right to legal equality had been compromised, and his argument that the disclosure requirements "“ on their face "“ are invalid. Any opponent, too, faces disclosure requirements under the law, FEC said.

The lineup of amici was quite predictable "“ foes of limits on campaign spending joined in supporting Davis' appeal, while organizations long associated with campaign finance reform advocacy "“ like Common Cause and Democracy 21 "“ entered the case to support Section 319 against Davis' challenge.

Amici on his side of the case suggest, among other arguments, that the Justices should apply strict scrutiny to the Amendment, because, they contend, it severely inhibits political speech. One organization on that side "“ the Center for Competitive Politics "“ suggested that, even though a self-financed candidate can spend at will, those who would like to contribute to his campaign and his party are subject to the regular contribution and coordinated spending limits that are lifted for his opponent's backers.

On the FEC's side, one of the amici briefs suggested that Section 319 has not worked in practice to discourage self-financed candidates. The available data, the brief said, is that the number of candidates who used more than $1 million of their own money rose from 2002 to 2006. In addition, it said, self-finance candidate appear not to be facing heavy spending from their opponents. In the 2004 congressional election, it recounted, 93 candidates were allowed to raise added funds for their campaigns, but 37 of them did not raise more than $2,000 in any single contribution.

An amicus that does not support either party "“ the Cato Institute "“ basically mounted arguments on the merits that closely parallel some of Davis' contentions.

Posted in Davis v. FEC, Everything Else