Today, the United States Supreme Court struck down McCain-Feingold's so-called Millionaire's Amendment. In so doing it resolved two key issues concerning the constitutional analysis to be applied in cases that involve campaign-finance disclosure and public funding of elections. The James Madison Center for Free Speech and Citizens United filed an amici curiae brief opposing the Millionaire's Amendment, in Davis v. Federal Election Commission, arguing that it imposed unconstitutional burdens on the right of candidates to self-fund their campaigns.

Jack Davis, a Democrat candidate for the U.S. House, became subject to the Amendment by spending his own money to help fund his campaign. The Amendment requires House candidates intending to contribute (or loan) more than $350,000 to their campaign to notify the FEC and opponents of that intent and then file frequent reports on their self-funding. When the $350,000 threshold is reached, the Amendment also raises the contribution limits of that candidate's opponent, allowing the opponent to raise significantly more money from people who have reached their $2,300 contribution limit. The FEC and so-called campaign finance reformers attempted to justify the Amendment as an attempt to level the playing field for candidates. But it actually favors incumbents because it only addresses the advantage that personal wealth can give to a campaign, not the advantages that incumbents have (e.g., name recognition, public office, and prior campaign experience that make fundraising and campaigning easier).

A three-judge federal district court in DC ruled against Davis, holding that the Amendment did not burden his free speech rights but merely benefitted those choosing not to give (or loan) so much money to their campaigns. The court analogized the Amendment to public-funding schemes, which also impose additional disclosure requirements and raise limits when non-participating candidates spend beyond certain expenditure limits.

The James Madison Center for Free Speech and Citizens United filed an amici curiae brief in support of Davis. The brief made two central arguments. First, it argued that the disclosure requirements were unconstitutional for requiring that a candidate's contributions to his campaign be disclosed as they were being made, in addition to being reported on the normal periodic disclosure schedule. Second, it argued that a law benefitting one candidate necessarily harmed the other candidate because a campaign is a zero-sum contest.

The Supreme Court declared the disclosure requirements unconstitutional. It recognized that compelled disclosure is inherently a burden on First Amendment privacy rights that must be "closely scrutinized." The Amendment required a candidate to report contemporaneously information he was already required to disclose on periodic reports, but that was a burden triggering "close scrutiny." As to the required scrutiny, it involved two elements identified in Buckley v. Valeo (1976), i.e., "exacting scrutiny" (which has in other contexts been identified as "strict scrutiny") and a "relevant" and "substantial" "correlation" or "relation" between the government's interest and the information that would be disclosed (which Buckley interpreted to require that any expenditure be "unambiguously related to the campaign of a specific candidate"). That the level of scrutiny the Court imposed was very high is evidenced by the fact that it held the disclosure requirements here to be unconstitutional, even though they only required earlier reporting of contributions that would have to be reported anyway and even though they imposed disclosure in the highly-regulated field of candidate campaign financing disclosure.

As to whether a benefit to one candidate burdens the opposing candidate, the Court said that it did. And it cited an Eighth Circuit decision, Day v. Holahan, which applied the same principle in the public funding context. This settles a long simmering debate among the lower federal courts about whether a benefit to an opposing candidate harms the non-benefitted candidate. Davis clearly establishes that there is such a harm and held that this harm was not constitutionally justified.

According to James Bopp, Jr., counsel for the James Madison Center for Free Speech and Citizens United: "This decision has broad implications for other cases. The Court has clarified that compelled disclosure is inherently a First Amendment burden that must be justified under a very high standard of review. And candidates have a First Amendment right to fund their own speech without being burdened by government provision of benefits to their opponents. This has broad implications for public-funding schemes."

The amici curiae brief can be found at www.jamesmadisoncenter.org.

James Bopp, Jr. has a national federal and state election law practice. He is General Counsel for the James Madison Center for Free Speech and former Co-Chairman of the Election Law Subcommittee of the Federalist Society.

Today, the Indiana Democratic Party and the Indiana Republican Party filed a joint friend-of-the-court brief in a case involving computer-generated political calls. The case, State of Indiana v. American Family Voices, Inc., was initiated by the State of Indiana against American Family Voices and others for using automatic dialing machines to make political calls during the 2006 election cycle. The case was dismissed by the trial court, based on the Defendant’s argument that the statute only prohibited commercial calls.  The Attorney General appealed and the case was taken up directly by the Indiana Supreme Court, bypassing the Court of Appeals.

Both political parties would use robocall technology to make political calls, if it were legal. In their brief, the political parties argue that the Indiana Supreme Court should construe the statute to only apply to commercial calls. To apply it to political calls violates both the Indiana Constitution and the First Amendment of the U.S. Constitution.

James Bopp, Jr., counsel for both the Indiana Democratic and Republican Parties in this matter, states that "this type of political call serves a valuable public function that is in the public's interest. Such calls are used to remind Hoosiers to register to vote and to vote on election day." He continues, "if this law is interpreted to include political calls, a disservice will be done to Indiana residents, and political candidates and parties will be unconstitutionally deprived of their free speech rights." 

Bopp successfully argued the most recent campaign finance case before the Indiana Supreme Court, Brownsburg Area Patrons Affecting Change v. Baldwin, decided in 1999, and has won four of the five campaign finance cases he has orally argued in the United States Supreme Court.

Oral argument in the case is scheduled for June 16, 2008.

James Bopp, Jr. has a national federal and state election law practice. He is with the law firm of Bopp, Coleson & Bostrom in Terre Haute, IN, is General Counsel for the James Madison Center for Free Speech and former Co-Chairman of the Election Law Subcommittee of the Federalist Society.