Search Results for: danielczyk

Here.

Bloomberg BNA:

Two Virginia businessmen, William Danielczyk and Eugene Biagi, pleaded guilty Feb. 26 to charges of violating campaign finance laws by funneling nearly $200,000 in corporate contributions to campaign committees of Hillary Clinton, the former senator from New York and secretary of state (U.S. v. Danielczyk, E.D. Va., Criminal No. 11-85, pleas entered 2/26/13).

Plea agreements signed in the case indicated that Danielczyk could face five years in prison as a result of the long-running criminal case, while Biagi faces probable probation and a fine. They are due to be sentenced May 17.

Danielczyk and Biagi agreed to plead guilty in an unexpected move on the day a trial was set to begin in their case in federal court in Alexandria, Va. The development came a day after the Supreme Court said it would not take up a challenge to the century-old federal ban on corporate campaign contributions, which stemmed from a pre-trial ruling in the case (U.S. v. Danielczyk, U.S. No. 12-579, cert. denied 2/25/13; 3456 Money & Politics Report, 2/26/13).

Bloomberg BNA reports on Danielczyk.

Via SCOTUSBlog comes the news that the Supreme Court, without comment, has denied cert. in Danielczyk v. U.S.,The decision not to hear the case is significant, because it means the Supreme Court majority, which has shown hostility to campaign finance limits, has decided not to move as aggressively as it could in further deregulating the campaign finance system.

The case raised the question (in the context of a criminal prosecution) whether corporations have a constitutional right to contribute money directly to candidates. The 2010 Citizens United case held that corporations have a constitutional right to spend money independent of candidates, but the opinion did not address corporate contributions to candidates (or contribution limits more generally).  A number of campaign finance opponents argued that the logic of Citizens United compelled the conclusion that the corporate contribution limit should fall also. One problem with this argument in the lower courts is that the Supreme Court had held, in a case predating the Roberts Court’s skeptical approach to regulation, that the corporate contribution ban was valid [typo corrected].  Among other things the Court said that a corporate contribution ban prevented circumvention of individual contribution limits (after all, an individual could set up a large number of corporations to make contributions directly to candidates).

I successfully defended San Diego’s corporate contribution ban in the Thalheimer case before the 9th Circuit Court of Appeals. All of the other circuit courts reached the same conclusion: that the corporate contribution limit stands under earlier Supreme Court authority.  Danielczyk case the only case to reach a contrary conclusion in the district court, but was reversed by the 4th Circuit to bring it in line with the other circuits.

Although there was no circuit split on this question (a common reason for the Supreme Court to agree to hear the case), the lower courts clearly expressed the opinion that the issue was foreclosed by earlier Supreme Court authority, and it would be up to the Supreme Court if it wanted to change the existing standard.

By not agreeing to hear Danielczyk, the Court leaves corporate contribution bans in place not only on the federal level, but under state and local law. It may be that after the Supreme Court decides the McCutcheon case, involving aggregate contribution limitations, that the standards for judging the constitutionality of contribution limit laws could change, making those laws harder to sustain. That could open up the corporate contribution limitation yet again. But in the meantime, the reform community dodged a bullet, because if the Court agreed to take Danielczyk, it almost surely would have been to reverse the Court’s earlier case on the question.

Yet another ray of light in an otherwise bleak campaign finance picture.

Bloomberg BNA on Danielczyk.

It turns out that Danielczyk has been relisted for Friday’s conference. (Thanks to a reader for calling this to my attention.)  The Court could still put the case on hold for McCutcheon, or grant and hear the case net term as well, or deny cert.  My betting at this point would be on the first or second, but not the third, option.  We’ll see.

The McCutcheon grant of review got front page coverage in the New York Times, as well as this NYT editorial. More coverage from:

NPR

Reuters

USA Today

WaPo

The Hill

National Law Journal

ACS

Constitutional Law Prof Blog

Inside Political Law

Today the Supreme Court agreed to hear the McCutcheon case challenging the limits on the total amount of aggregate contributions a person may make to candidates, party committees, and certain PACs.  I thought this decision to hear the case was fairly likely, given that the case came up on appeal rather than on cert.—meaning a decision not to hear the case would mean that the Supreme Court agreed with the lower court ruling on the merits (something not true with a cert. petition—once again, the technical distinction between cert. petitions and appeals in election law cases moves the law forward more quickly).

How significant is this case?  In some ways, in the era of Super PACs and c4s, the issues here are less burning than in years past. After all, while it is true that a person could not give, say, $2,600 to a candidate for each congressional office in a two-year period without running afoul of the aggregate contribution limits, that same person could give unlimited sums to Super PACs or c4s which could spend MUCH more than $2,600 per race from that person to support that candidate for office.

But the case has broader significance—this case will mark the first opportunity for the Supreme Court to say something about how it will review the constitutionality of contribution limits after the Citizens United case. CU involved independent expenditures by corporations, and the Court in CU expressly refused in that case to reconsider any of the law related to contributions. It is possible in this case, for example, that the conservative five Justices in CU set out a general standard for reviewing contribution limits which makes them harder to sustain against constitutional challenge.  In the past, contribution limits were subject to a very complaisant standard of review, very easy to sustain against challenge. (The possibility that the Court could do this may explain why the Court has not ruled on the pending cert. petition in the Danielczyk case, challenging the constitutionality of the ban on direct corporate contributions to candidates. It could well hold this case for the outcome of McCutheon.)

More broadly, a decision to strike down aggregate contribution limits could lead the Court to overrule that portion of Buckley v. Valeo upholding aggregate contribution limits. This would be of enormous symbolic significance. Buckley has been the law since 1976, an uneasy compromise making independent spending limits very tough to uphold (upheld later against corporations in Austin, later reversed in CU), but contribution limits very easy to uphold. Striking part of the Buckley edifice could mean that more will fall, and that the Court’s general skepticism toward the constitutionality of limits already in play in the independent spending area could spread to contribution limits.

This would be the next logical progression of the Roberts court on these issues, ever since Justice Alito replaced Justice O’Connor. As I wrote in 2006 in No Exit? The Roberts Court and the Future of Election Law:

Making predictions is always dangerous, and the conclusions I reach should be taken in the tentative spirit in which they are made. My best guess is that a decade from now, we may well face a set of election law rules that differ a great deal from today’s rules. It may be that in 2016, individuals, corporations, and unions will be free to give as much money as they want to any candidate or group, subject to the filing of disclosure reports. The federal government’s ability to protect the voting rights of minority groups that historically have been the victims of state discrimination may be curtailed by the inability of Congress to require any jurisdictions to submit their voting changes for preclearance and by an emasculated reading of Section 2 of the Voting Rights Act. The ability of states to manipulate election rules for partisan gain may present the greatest danger as the Court exits from that corner of the political thicket. For those who look to courts for the promotion of political equality, the signs are not encouraging.

The NLJ reports (article currently behind paywall; UPDATE: now freely available). In the article I make predictions about whether the Court will take Danielczyk and McCutcheon.

Bloomberg BNA: “The Supreme Court is set to consider next month whether to grant review of a constitutional challenge to the century-old ban on corporate campaign contributions (Danielczyk v. U.S., U.S., No. 12-579, cert. petition filed 11/8/12). The case challenging the corporate contribution ban was distributed Jan. 23 for consideration at the justices’ private conference on Feb. 15. The court also received Jan. 23 a reply brief from lawyers representing businessmen William Danielczyk and Eugene Biagi.”

Also at the same conference: a petition (McCutcheon) challenging the aggregate contribution limitation.

A cert grant in both would not surprise me.

Bloomberg BNA: “The Supreme Court should leave intact the ban on corporate campaign contributions to federal candidates first enacted in 1907, the government argued in a brief filed Jan. 9 (Danielczyk v. U.S., U.S., No. 12-579,response filed 1/9/13).”

Bloomberg BNA: “The Supreme Court is being asked in a newly filed petition to overturn the century-old ban on corporate campaign contributions to federal candidates. The request for Supreme Court review came Nov. 8 in a long-running case involving Virginia businessman William Danielczyk, who faces criminal charges of violating campaign finance laws by funneling corporate contributions to the 2008 presidential campaign of Hillary Clinton (Danielczyk v. U.S., U.S. 12-579, cert. petition filed 11/8/12). In a 35-page petition for certiorari, lawyers for Danielczyk and his business partner, Eugene Biagi, asked the court to re-examine the fundamental distinction between campaign contributions and independent campaign expenditures, which has been a hallmark of campaign finance law since the Supreme Court’s 1976 decision in Buckley v. Valeo.”

The Eighth Circuit has issued its en banc opinion in the Swanson case.  The Eighth Circuit now joins the Second, Fourth (after the rejection of the district court decision in Danielczyk) and Ninth Circuits (in the Thalheimer case in which I was involved) in holding that any challenge to corporate contribution bans in the lower courts is barred by the Supreme Court’s decision in FEC v. Beaumont.  The 8th Circuit does drop a footnote however suggesting that if and when this issue reaches the Supreme Court again, the Court could well overrule Beaumont.  (Without a circuit split, however, the Court is less likely to take such a case.)

The 8th Circuit split, however, on a particular aspect of Minnesota’s disclosure law which it said would put an onerous burden on small associations which want to engage in certain election-related speech.  The Court stressed however that political committees would still be required to disclose under Minnesota law, and that the part of the law imposing continuing reporting requirements might be severable from the rest of the law.

It could be the next stop after the Fourth Circuit denied rehearing in the Danielczyk case. For more on this issue, here are my earlier posts.

Is the timing of this plea one of the immediate consequences of Danielczyk?

It’s been an active day in the courts even beyond the health care rulings.  In the Danielczyk case, the Fourth Circuit has reversed the Virginia district court opinion striking down the federal ban on corporate contributions to candidates in the wake of Citizens United.

Rick had urged a prompt appeal of the district court’s outlier opinion, and the Fourth Circuit appears to have responded.  The court not only found Danielczyk squarely governed by Beaumont v. FEC (the Supreme Court case upholding the federal ban on corporate contributions in 2003), but emphasized the distinction between the direct contributions at issue here and the independent expenditures at issue in Citizens United.

So now it looks like uniformity in the circuits: the government may ban corporate contributions, but not independent corporate expenditures.  Which returns to placing even more emphasis on the next front in the campaign finance wars: the conditions for coordination that mark the difference between one and the other.

Update:  Reports from WaPo, Bloomberg, and the AP; reactions from the Center for Competitive Politics and Campaign Legal Center.  More to come, I’m sure.

Bloomberg BNA: “Attorneys for Virginia businessmen challenging the constitutionality of the century-old ban on corporate contributions in federal election campaigns faced skepticism from a federal appeals court panel May 18 (U.S. v. Danielczyk, 4th Cir., No. 11-4667, oral argument 5/18/12)….During the May 18 argument, questioning by Traxler and the two other judges on the appellate panel hinted that they were considering overturning the district court ruling because of concerns that the corporate contribution ban was upheld by the Supreme Court in a 2003 case, known as Beaumont v. Federal Election Commission. Discussion about the Beaumont case dominated the oral argument.”

See this AP report.

Bloomberg BNA: “A federal appeals court is set to hear arguments May 18 in the Justice Department’s challenge to a lower court decision that held as unconstitutional the federal ban on corporate campaign contributions (U.S. v. Danielczyk, 4th Cir., No. 11-4667, amicus filed 1/10/12).”

Also: “The U.S. Court of Appeals for the Eighth Circuit is considering a challenge to Minnesota’s campaign finance law regulating corporate money, which includes a corporate contribution ban in state campaigns (Minnesota Citizens Concerned for Life Inc. (MCFL) v. Swanson, 8th Cir., No. 10-3126, rehearing en banc order 7/12/2011). The en banc appeals court heard arguments in the case, known as MCFL v. Swanson, last September, but has yet to issue a ruling nearly eight months later.”

Agreeing with the Second Circuit and Eighth Circuit (now up on en banc appeal) and disagreeing with the district court in the Danielczyk case (now on appeal to the 4th Circuit), a federal district court in San Diego today had upheld the City of San Diego’s laws banning corporations, labor unions, and other non-individual entities (aside from political parties) from contributing money directly to candidates for City office.

The opinion in Thalheimer v. City of San Diego is here.[Disclosure: I am one of the attorneys for the City of San Diego.]

In addition to upholding the ban on corporate/non-human contributions directly to candidates, the Court also rejected a challenge to San Diego’s $500 individual contribution limit to City candidates, as well as a ban on contributions to City candidate more than 12 months before the election.

However, the Court struck down the ban on political party contributions to candidates, as well as a backup $1,000 contribution limit from political parties to candidates which the City had put in place after an earlier preliminary injunction.  “At this time, the Court cannot say whether a $5,000 or $20,000 limit on contributions by political parties would be sufficient to pass the constitutional muster under Randall.”  I believe this is the first case in which a court has held that political parties have a constitutional right to contribute money directly to candidates, and that the amount of the contribution limit must pass muster under the Randall analysis.

Politico reports on the RNC’s amicus brief in the Danielczyk case.

Think Progress Justice:Survey: Illegal Corporate Campaign Contributions Up 400%.

The NY Times editorializes on the RNC amicus brief in Danielczyk.  Political hay.

See here.

Professors Milyo and Primo have filed this amicus brief in the Danielczyk case, disputing the government’s characterization of their scholarship.

(H/t Woody Allen)

Fred Wertheimer on the RNC brief in Danielczyk which I flagged yesterday.  MORE from the WSJ law blog.

The opinion is here [updated link].  See also this Thomson Reuters report.  Among other things, the opinion

(1) confirms that lower level scrutiny applies to laws regulating contributions even after Citizens United (“Since the Supreme Court preserved the distinction between expenditures and contributions, there is no basis for Appellants’ attempt to broaden Citizens United. Appellants’ selective and misleading quotes carefully skip over the Court’s clear distinction between limits on expenditures and limits on contributions”);

(2) affirms that the anti-circumvention interest remains valid after Citizens United and FEC v. Beaumont remains good law (“The Court is aware of United States v. Danielczyk, No. 1:11cr85 (JCC), 2011 WL 2161794 (E.D. Va. May 26, 2011), which struck down a ban on corporate contributions, based on what it called an ‘inescapable’ expansion of Citizen United’s logic. Id. at *18; Danielczyk, 2011 WL 2268063 (E.D. Va. June 7, 2011) (denying reconsideration). The role of an appellate court is to apply to law as it exists. Since the Supreme Court reaffirmed the validity of the 100-year old corporate ban just 8 years ago, Beaumont, 539 U.S. at 154-55, and declined to overrule this holding in Citizens United, this Court will not do so here. Indeed, Citizens United confirms that the anti-corruption interest is a legitimate justification for campaign contribution restrictions. Citizens United also does not disturb the validity of the anti-circumvention interest. See Thalheimer v. City of San Diego, Nos. 10-55322, 10-55324, 10-55434, 2011 WL 2400779, at *13 (9th Cir. Jun. 9, 2011) (concluding that ‘nothing in the explicit holdings or broad reasoning’ of Citizens United invalidates the anti-circumvention interest in the context of contribution limits)”);

(3) states that broader forms of influence may count as corruption for purposes of sustaining contribution limits (“Although Citizens United stated that mere influence or access to elected officials is insufficient to justify a ban on independent corporate expenditures, improper or undue influence presumably still qualifies as a form of corruption”)(Judge Livingston disagreed on this point); and

(4) evidence of actual recent corruption is not necessary to sustain a contribution limit (“Appellants essentially propose giving every corruptor at least one chance to corrupt before anything can be done, but this dog is not entitled to a bite.”), though there was enough evidence of recent corruption in any case to justify the City’s law.

Judge Calabresi issued a short concurring opinion taking on a broader issue, the legitimacy of an equality interest for campaign finance regulation:

I agree completely with the Supreme Court that the First Amendment protects each person’s right to express political beliefs through money. Where I disagree with the Court is in its repeated insistence that any recognition of the “level playing field” interest (elsewhere referred to as the “antidistortion interest,” Citizens United v. FEC, 130 S. Ct. 876, 903 (2010)) is inconsistent with this right. To the contrary, the antidistortion interest promotes this right in two important ways. First, it prevents some speakers from drowning out the speech of others. And second, it safeguards something of fundamental First Amendment importance—the ability to have one’s protected expression indicate the intensity of one’s political beliefs. These values, moreover, have not gone unrecognized in underlying First Amendment jurisprudence.

[Disclosure: I am litigating similar issues in the Thalheimer case (quoted by the 2d Circuit above) against the same lawyers representing the challengers in this litigation.  The Thalheimer case is back before the federal district court on cross-motions for summary judgment.]

Good news in Preston v. Leake from the 4th Circuit, in a case which puts it at odds with the Second Circuit’s Green Party case.  (I discuss the Green Party case and the district court’s decision in Preston in my forthcoming lobbying paper in the Stanford Law Review.)

Assuming this decision stands (that is, is not taken en banc or heard by the Supreme Court now given the Circuit split), it would provide a strong basis for upholding the corporate contribution ban in the Danielczyk case.  (Disclosure: I am one of the lawyers representing the City of San Diego in the Thalheimer case, cited in Preston, considering the constitutionality of the City’s ban on corporate and other non-human entity contributions to candidates.)

This press release links to this 4th Circuit amicus brief in Danielczyk.  (The brief cites some of my blog posts on this case.)

The latest Times editorial on Danielczyk.

Bloomberg reports.  If anyone has a link to the brief, or copy of the brief, please send it along.

In Thalheimer v. City of San Diego, the Ninth Circuit upheld the trial court’s denial of a preliminary injunction of the City’s law barring non-human contributions to candidates (the same issue as in the Danielczyk case in the 4th Circuit and the Swanson case in the 8th circuit).  The court also denied a preliminary injunction as to time limitations for candidates raising campaign contributions.  The Ninth Circuit also denied rehearing en banc.

Today plaintiffs filed this letter with the district court, indicating that they will not be seeking Supreme Court review of the denial of the preliminary injunction on these two issues.  (The preliminary injunction was granted as to two other provisions of the law.)

Any further action in this case will take place next in the district court.

[Disclosure: I am one of the attorneys representing the City of San Diego in this case.]

Here (starting at page 100).  (h/t Brian Svoboda).

Big news from the Ninth Circuit.  The full court has denied rehearing en banc in this campaign finance case.  According to the order, no active judge on the court requested a vote in the case.  Among other things, the panel opinion held that a ban on non-human (e.g, corporate or union) direct contributions to candidates does not violate the First Amendment.  The court also held that a temporal limitation on campaign contributions (no contributions more than a year before an election) is likely constitutional.  [Disclosure: I am one of the attorneys for the City of San Diego.]

The district court in the Danielczyk case held that the federal corporate contribution ban was unconstitutional, a case now on appeal to the Fourth Circuit. The Eighth Circuit in the Swanson case held that a similar Minnesota ban was constitutional, but this case in now up for en banc consideration.

We will wait to see if Jim Bopp files a petition for cert. in this case.

Garrett Epps blogs on Danielczyk.

Here, at the Northern Virginia Lawyer.

Lyle explains.

Lyle reports. No opinion today in McComish.

I’ll be out all day.  More posts late tonight.

BNA Money and Politics Report offers this report.  UPDATE:  The end of the article states: “The Justice Department is believed to be considering filing an appeal of Cacheris’ ruling, which threw out one count of an indictment of Danielczyk.”