May 01, 2008

Fourth Circuit Decides Two Important Campaign Finance Cases, Raising Issues that Could Get En Banc or Supreme Court Attention

Today the Fourth Circuit decided two important campaign finance cases, both confusingly with the same name. I discuss the most important aspect of these decisions at the end of this post: the court has struck down contribution limits on independent expenditure committees, an issue that is surely headed to the Supreme Court either in this case or in another case, such as the SpeechNow.org case.

The judicial elections case. A 4th Circuit panel today in North Carolina Right to Life v. Leake unanimously upheld three challenged provisions of a North Carolina law establishing public financing for appellate judicial elections. The first two rulings strike me as correct under current law and unsurprising. The court rejected any argument that the voluntary public financing program is coercive or unconstitutional because it provides matching funds. Second, the court rejected a challenge to the disclosure requirements of the law, including those that apply to non-participating candidates.

The controversial part of the opinion, at least in my view, is the court's decision to uphold a complete ban on campaign contributions during the last 21 days of the election. The ban is narrow: it applies only when a nonparticipating candidate faces a participating candidate, and where the additional contributions would exceed the trigger for matching funds. The court says here that strict scrutiny does not apply, relying on McConnell. But it seems to me that there's a decent argument that a total ban on contributions triggers, if not strict scrutiny, a higher kind of scrutiny than a law that limits just the amount of such contributions. Someone might not pay attention to an election until the last three weeks, and this law prevents that person from even making the symbolic act of contributing a small, non-corrupting amount to a candidate. That interest was recognized in Buckley as the most important, even more important than the interest in giving a lot of money to a candidate.

A narrow petition for rehearing en banc or cert petition could potentially get someone's attention on this point.

The Political Committees case. The second case, decided 2-1 is also named North Carolina Right to Life v. Leake. In this case, the majority first struck down North Carolina's definition of political committee as inconsistent with WRTL II because it extended beyond express advocacy and the "functional equivalent of express advocacy." It also held the the definition was so full of constitutional infirmities that the law could not be upheld facially and then attacked through as applied challenges (as occurred with BCRA). The court then held that North Carolina's definition of political committees to include an "a major purpose test" (as opposed to a "the" major purpose test) unconstitutionally burdened the right of political association.

Most importantly, the majority strikes down contribution limits to independent expenditure committees as not justified by an interest in preventing corruption. As I've said many times, the argument is that if George Soros has the right to spend unlimited sums supporting or opposing candidates for office, he should have a right to give unlimited contributions with others to a group that engages in the same independent activity. This is an issue the Supreme Court has not squarely addressed (outside a possible reference in a concurrence in a 1978 case and an oblique footnote in the McConnell case), and it is the major unanswered question in campaign finance regulation. It is the issue at the heart of the SpeechNow case. This case may now leapfrog over SpeechNow to become the case in which the Roberts Court takes on the issue (and readers of my blog will know what I think is likely to happen to this provision in that Court). Indeed, Jim Bopp, winning in this case, might not oppose a writ of certiorari on this issue, in order to get a Supreme Court stamp of approval on this very anti-regulatory majority opinion.

The majority opinion could have been written by Brad Smith, when Judge Wilkinson declares on pdf 33: "For the regulator's hand, once loosed, is not easily leashed. The Code of Federal Regulations, or its state equivalent, is no small thing. It is no unfounded fear that one day the regulation of elections may resemble the Internal Revenue Code, and that impossible complexity may take root in the very area where freedom from intrusive governmental oversight should matter most. For while appropriate regulation may serve good and useful purposes in many areas, the Constitution makes clear that excessive regulation of political speech is suspect."

The dissent is equally impassioned. It makes a number of important arguments over how broadly WRTL should be read and how much deference to give to the Legislature. A few years ago, I would have said that the dissent's position is the one the Supreme Court would have embraced. Not any more.

Posted by Rick Hasen at May 1, 2008 12:32 PM