Search Results for: thalheimer

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.

Missoulian: “The Montana Republican Party donated $500,000 to gubernatorial candidate Rick Hill and approximately $30,000 to attorney general candidate Tim Fox after a judge struck down the state’s campaign contribution limits.” More here.

We saw a similar move in the Thalheimer case when San Diego’s limits were temporarily blocked.

Following up on this post, the Ninth Circuit motions panel, in an opinion by Judge Bybee, unanimously stayed the district court order which would have had the effect of removing most of the contribution limits in the state of Montana judge weeks before the election.  As I had suggested, heavy on the 9th Circuit judges’ concerns were what it would mean to lift these limits just before the election and the fact that the judge threw out a large number of contribution limits after finding a problem only with one of them.  But also especially relevant was earlier Ninth Circuit authority upholding Montana’s limits, which the district court had held was no longer binding on the court in light of the Supreme Court’s decision in Randall.  The Ninth Circuit panel, made up of pretty conservative judges, gave an unusually detailed explanation for why it was staying the judge’s ruling.

Here’s part of the introduction to the 44-page opinion:

The State of Montana has sought a stay of the district court’s order pending appeal. For the reasons we explain below, we believe that the state is likely to succeed on appeal. We conclude that the State of Montana has made a strong showing that a merits panel of this Court will likely conclude that, absent en banc proceedings or an intervening decision of the Supreme Court, we remain bound by our decision in Eddleman. See Miller v. Gammie, 335 F.3d 889, 892–93 (9th Cir. 2003) (en banc). We also conclude that a merits panel is likely to hold that the analytical framework of the Supreme Court’s decision in Randall does not alter the analysis of Buckley or Shrink Missouri in a way that affects our decision in Eddleman, for three reasons. First, there is no opinion of the Court in Randall. Thalheimer v. City of San Diego, 645 F.3d 1109, 1127 n.5 (9th Cir. 2011) (“[T]he plurality opinion [in Randall] [i]s persuasive authority, though not a binding precedent.” (internal quotation marks omitted)). Second, even if we thought that Justice Breyer’s plurality opinion represented the narrowest view of a majority of the Court, it did not depart from the principles of Buckley and Shrink Missouri that we applied in Eddleman. Randall, 548 U.S. at 242 (opinion of Breyer, J.) (“[T]his Court has repeatedly adhered to Buckley’s constraints . . . .”). Third, even if we applied Randall to § 13-37-216, we cannot find, on the basis of the district court’s findings, reason to disagree with, much less overturn, Eddleman. In light of Montana’s interest in regulating campaign contributions, the lack of evidence that other parties will be substantially injured, and the public’s substantial interest in the stability of its electoral system in the final weeks leading to an election, we will stay the order pending the state’s appeal. See Nken v. Holder, 556 U.S. 418, 434 (2009).

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.

Another interesting campaign finance case filed by the Right to Life Committees, and another interesting campaign finance case out of Vermont.  The decision on summary judgment denied the plaintiffs’ challenges to the application of Vermont’s law.  Along the way, the court offers an intriguing discussion on “major purpose” as a limit on regulating PACs, at odds with the Fourth and Tenth Circuits.  And an intriguing decision on refusing to find segregated bank accounts alone (without distinct accounting) sufficient to render an independent-expenditure entity distinct from a related entity making contributions, distinguishing the DC Circuit’s opinion in Emily’s List (and, perhaps, the Thalheimer litigation that Rick is working on in San Diego).

The case is Vermont Right to Life Committee v. Sorrell (II), No. 2:09-cv-188 (D. Vt.).

The time to appeal has passed in the litigation over challenges to a number of City of San Diego campaign finance laws. [Disclosure: I am one of the lawyers for the City of San Diego.]  The case went to the Ninth Circuit at the preliminary injunction stage but there was no appeal after the district court decided the cross-motions for summary judgment.

Among other things, the Ninth Circuit held at the preliminary injunction stage 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 constitutional, a decision the Ninth Circuit recently affirmed in Family PAC v. McKenna.

I am very proud to have worked on this case with Dick Semerdjian and John Schena of Schwartz Semerdjian Ballard and Cauley.

Jason Campbell has published this student note in the Loyola of Los Angeles Law Review.  Here is the abstract:

Since the early twentieth century, the Tillman Act has barred corporations from contributing directly to candidates for federal office. In Citizens United v. FEC, the U.S. Supreme Court overturned a related ban that prevented corporations from making independent expenditures in candidate elections. The legal foundation of the independent expenditure ban was similar to that which still supports the corporate direct contributions ban, thus calling into question the continuing validity of the direct contributions ban. This Note argues that if the Court follows the logical path that it laid down in Citizens United, it should overturn the corporate direct contributions ban.

Jason was an excellent research assistant of mine.  I did not advise him on this note, however, as the very issue of this note was pending in the Thalheimer litigation from San Diego at the time he worked on it.  (I am one of the attorneys for the City of San Diego in that litigation.)  I very much look forward to reading it, and congratulate him on the publication.

From Gil Cabrera of the San Diego Ethics Commission and T.J. Zane of the Lincoln Club.  [Disclosure: I am one of the attorneys for the City of San Diego in this litigation.]

Here.

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.

Viveca Novak has written this must-read profile of Jim Bopp for the American Prospect.  Viveca, a former Time correspondent who I got to know during Florida 2000, has recently taken up the position as Editorial and Communications Director for the Center for Responsive Politics.

I’ll be going up against Citizen Bopp in federal district court in San Diego Friday in the Thalheimer challenge to the City of San Diego’s campaign finance laws.

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.]

Dick Semerdjian and I (representing the City of San Diego in the Thalheimer litigation) have written this letter to the editor of the San Diego Union-Tribune.

The case is currently subject to cross-motions for summary judgment in federal district court.

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.)

Read the complaint here.  (Some aspects are similar to the suit filed in the Thalheimer case, in which Bopp is on one side and I am one of the lawyers representing the City of San Diego on the other.)

More in this story.

The following press release arrived from the James Madison Center via email.

Coalition Files Lawsuit Challenging Montana’s Campaign Finance Law

 Montana residents Doug Lair and Steve Dogiakos, and American Tradition Partnership PAC want to give a couple hundred dollars in contributions to candidates that they like for the Montana State House. Montana, however, limits their contributions to just  $160, which is among the lowest limits in the country. The Lake County Republicans and the Beaverhead County Republicans, meanwhile, just want to make an $800 contribution to Republican candidates running for state office. However, if one of them makes that contribution, the other is not allowed to—even though they are two distinct groups, with separate membership and leadership. Three Montana business corporations—Jake Oil, LLC, JL Oil, LLC, and Champion Painting, Inc.—want to make contributions to candidates, and also to committees that spend money independently of candidates. But Montana law does not allow them to do so, because they are corporations. And John Milanovich, candidate for the Montana House in 2012, would gladly accept contributions from individuals and PACs greater than $160, and also from corporations. But he cannot do so under the law.

 Meanwhile, Montana Right to Life PAC, Sweet Grass Council for Community Integrity, and American Tradition Partnership want to communicate important information to the voters about candidates and their positions on the issues. But under Montana law, they can be subjected to penalties if the State decides that what they say is “false.” Further, if they mention how a candidate voted on a certain issue, the State says that they must also include a disclaimer telling about the candidate’s other votes “on the same issue” if “closely related in time.” But the law doesn’t explain what those terms mean. For instance, if one of these groups discusses a candidate’s vote to raise taxes on corporations, what is the “same issue”? Is it only votes regarding tax increases on corporations? Or is it taxes in general? Or might the “same issue” be the regulation of corporations, whether or not the proposed regulation includes a corporate tax? Nobody knows. And that uncertainty, coupled with the fear that the State might judge their speech “false” and punish them for saying it, makes groups hesitant to speak out about politicians.

Yesterday these Montana citizens said, “Enough is enough,” as they filed a lawsuit challenging the constitutionality of these laws. James Bopp, Jr., the lead attorney for the plaintiffs, said that each of the challenged laws is impermissible under the First Amendment. “The Supreme Court has ruled that corporate political speech is protected by the First Amendment, and you cannot ban political speech just because the speaker is a corporation. Yet, Montana does that,” Mr. Bopp explained. He commented further, “The Founders did not trust government to be the speech police and tell us what we can say, or what we must say. Yet Montana’s false statement law and disclaimer requirement do just that. The First Amendment does not permit this.”

 Mr. Bopp also explained that limits on contributions are only constitutional when they are designed to curb the type of quid pro quo corruption that can take place with large contributions. When limits are not needed to curb corruption they violate the First Amendment. “It’s simply not plausible that a donation of, say, $200 is going to corrupt a candidate. Yet Montana bans it anyway. Nor is it plausible that donations from political parties will corrupt candidates. Yet, Montana says that once one political party has contributed $800 to a candidate, no other political party may make any contribution. These laws do not pass constitutional muster.”

 The plaintiffs will also ask the court to preliminarily enjoin enforcement of these laws. Their documents are available on the James Madison Center website by clicking here: http://www.jamesmadisoncenter.org/cases/09-07-2011/688/.

It would seem to m that the attack on a ban on contributions to corporations would be tough given the Ninth Circuit’s recent ruling in the Thalheimer case.  [Disclosure: I am one of the lawyers for San Diego in that case.]

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.]

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.

You can read it here. You can find my earlier coverage of this case here. [Disclosure: I am one of the attorneys for the City of San Diego.]  Under the rules, no response to the petition may be filed unless the court asks for a response.