BIG Campaign Finance News: La. GOP Soft Money Lawsuit Gets 3-Judge Court, Likely Ticket to SCOTUS

I know it is late on Friday, the day after Thanksgiving, but here’s some very big news. It sounds technical, but it really, really matters.

A federal district court has held that the Louisiana GOP, under the guidance of tenacious campaign finance lawyer Jim Bopp, has the right to have a challenge to McCain-Feingold’s soft money ban applied to state parties through a three-judge court. Getting there took some very clever drafting, as the court recognized:

Close observers of the campaign-finance arena may be experiencing twinges of déjà vu. Last year, these same plaintiffs, represented by the same counsel, were among those who mounted similar challenges to the soft-money ban before this Court. See Rufer v. FEC, 64 F. Supp. 3d 195 (D.D.C. 2014); RNC v. FEC (“RNC II”), No. 14-cv-00853 (D.D.C. Aug. 19, 2014). This Court declined to convene a three-judge court to hear those challenges. While the Court found that the plaintiffs had presented “substantial, non-frivolous” constitutional claims, it concluded they lacked standing to bring those claims before a three-judge court because their central alleged injury—being prevented from accepting unlimited contributions to fund “independent” election activity—could have been redressed only by invalidating the longstanding base party contribution limits in FECA. Rufer, 64 F. Supp. 3d at 198. BCRA three-judge courts, however, are empowered to decide only constitutional challenges to provisions of BCRA itself. Id. Having been deprived of a direct ticket to the Supreme Court, the Rufer and RNC II plaintiffs abandoned their appeal of the Court’s ruling, and at least some of them regrouped to fight another day.

That day has now come, and the Court is again presented with the same two questions: Are Plaintiffs’ constitutional claims substantial, and are their alleged injuries redressable by a BCRA three-judge court? The Court this time answers yes to both. As in Rufer and RNC II, Plaintiffs have presented substantial constitutional claims. While the Supreme Court has twice upheld BCRA’s soft-money ban, and recently affirmed that it is still intact, its ruling in McCutcheon created widespread uncertainty over the central question presented here: whether truly independent campaign expenditures by political parties—if there can be such a thing—pose the type of corruption risk that the Supreme Court has held is necessary to justify limiting federal election spending. Given this uncertainty, Plaintiffs’ claims cannot be fairly characterized as “frivolous,” “obviously without merit,” or “so foreclosed by” Supreme Court precedent that there is “no room for the inference that the question sought to be raised can be the subject of controversy.” Feinberg v. FDIC, 522 F.2d 1335, 1339 (D.C. Cir. 1975) (quoting Ex parte Poresky, 290 U.S. 30, 32 (1933)).

But unlike in the prior cases, the Court concludes that Plaintiffs here have standing to present their claims to a three-judge court. The core injury alleged by the Rufer and RNC II plaintiffs could not have been redressed without striking down FECA’s base limits, which a BCRA three-judge court may not do. Assiduously avoiding a frontal assault on the base limits, Plaintiffs here re-characterize their injury as simply being prevented from spending funds from state-party-committee accounts on federal election activity, without regard to the FECA base limits. Make no mistake, a ruling for Plaintiffs on the merits would render largely meaningless FECA’s limits on contributions to state- and local-party committees: Depending on the contribution limits in the relevant state, if any, an individual or corporation would be able to contribute sums in excess of the existing FECA-imposed federal limits to a state party, and the party could then deposit those funds in a state account and use them to engage in “independent” federal election activity on a scale that would be impossible under existing law. Plaintiffs have nevertheless established standing because, technically speaking, the relief they seek can be achieved by invalidating BCRA’s soft-money ban while leaving FECA’s base limits in place. Clever indeed, but not too clever by half as the FEC suggests. The Court will, accordingly, grant Plaintiffs’ motion to convene a three-judge district court to hear their claims as required by BCRA § 403.

Why are the stakes so high?  I explained it in August in The McCain-Feingold Law May Doom Itself, National Law Journal, Aug. 16, 2015:

Tucked within the Bipartisan Cam­paign Reform Act (the formal name for “McCain-Feingold”) is a provision requiring that certain constitutional challenges to the law be heard by a three-judge court, with direct appeal to the U.S. Supreme Court. This special jurisdictional provision makes it much more likely that within the next few years the Supreme Court will strike limits on the amounts people and entities can contribute to the political parties in so-called party soft money.

If the court does so, it would be knocking down the second of McCain-Feingold’s two pillars. The court knocked down the first pillar—the limits on corporate and union spending—in the 2010 case Citizens United v. Federal Election Commission.

It may seem hard to believe that procedural rules for court challenges could make a difference as to the fate of campaign financing in the United States, but it matters. When a case comes up to the Supreme Court through the normal process of federal district court or state court decision followed by appellate court review, the losing side files a petition for writ of certiorari.

A Supreme Court decision to deny certiorari has no precedential value; no one can cite a certiorari denial as proof the Supreme Court believes the lower court got it right.

But in a rare set of cases (these days confined to certain campaign finance, redistricting and voting-rights cases) pursuant to federal statute are heard initially by a three-judge federal district court with direct appeal to the Supreme Court. In these cases, a court decision to affirm a three-judge court or to dismiss the appeal does count as a decision that the lower court got right, even if not necessarily for its reasoning. This fact makes it much more likely that the Supreme Court will hear such cases.

Justices have said the ­jurisdictional provision matters.

Since I wrote this oped, Chief Justice Roberts at the oral argument in Shapiro v. McManus has confirmed his feeling of the obligation to take three-judge court cases:

 CHIEF JUSTICE ROBERTS:  I mean, the other alternative is it’s a three-­judge district court, and then we have to take it on the merits.  I mean, that’s a serious problem because there are a lot of cases that come up in three-judge district courts that would be the kind of case –­­ I speak for myself, anyway– ­­ that we might deny cert in, to let the issue percolate.  And now with the three­-judge district court, no, we have to decide it on the merits…


As I concluded in my August oped:

The Roberts Court has proved itself quite deregulatory in campaign-finance cases. It has struck down or narrowed severely every campaign-finance limit it has ever considered. Further, in the 2014 McCutcheon case, Roberts suggested a soft money ban is unconstitutional.

But the court has also proven itself willing to not hear every campaign-finance case to come its way. Twice, for example, it turned down certiorari petitions testing whether the ban on direct campaign contributions by corporations violates the First Amendment. In 2010, over the dissents of justices Anthony Kennedy, Antonin Scalia and Clarence Thomas, it turned down a certiorari petition in yet another case Republicans brought to challenge the soft-money rules

If the Republican Party of Louisiana is able to convince the courts this time that the three-judge court is the appropriate route to hear its soft-money challenge, then there’s a good chance the court will not only take the case, but will strike down what remains of McCain-Feingold.

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