Supreme Court strikes down individual aggregate contribution limits

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The United States Supreme Court has struck down a long-standing campaign finance provision that limited the total amount that individuals may contribute to federal political candidates and committees. The decision, in the case McCutcheon et al. v. Federal Election Commission, was handed down on April 2, 2014. It is the most significant campaign finance case since the Citizens United decision in 2010.

In a 5 to 4 decision, the Court reasoned in McCutcheon that the aggregate limits do not further a legitimate government interest and that the First Amendment protects the ability of an individual to contribute to as many candidates and committees as the individual wishes.

The aggregate limits at debate in the case established a maximum cap that an individual may give to all federal candidates and committees over a two-year election cycle. For 2013-2014, the figure was set at US$123,200. Within that total, an individual could give no more than US$48,600 to candidates for federal office, with the remainder of the limit available for contributions to federal party committees and federal political action committees.

Note that the aggregate limits struck down in the case are separate from the “base limits” that set a cap on the amount an individual may give to any given candidate or committee. Under the base limits in place for 2013-2014, an individual may give no more than US$2,600 per election to a particular federal candidate, no more than US$5,000 per year to a political action committee and no more than US$32,400 to a federal party committee. These limits, as well as similar ones that cap the size of donations by political action committees, remain in place following the Court’s ruling.

Writing for a plurality of the Court, Chief Justice John Roberts explained: “We have made clear that Congress may not regulate contributions simply to reduce the amount of money in politics, or to restrict the political participation of some in order to enhance the relative influence of others.” Justices Antonin Scalia, Anthony Kennedy and Samuel Alito joined in the Roberts opinion. Justice Clarence Thomas issued his own concurring opinion.

While acknowledging public concerns about the role of money in politics, Justice Roberts notes: “If the First Amendment protects flag burning, funeral protests, and Nazi parades – despite the profound offense such spectacles cause – it surely protects political campaign speech despite popular opposition.”

The bulk of the Court’s opinion addresses the question of whether the legitimate interest of combating corruption, which has been held to justify the base limits, also justifies the aggregate limits. The Obama Administration, defending the law, had argued that the aggregate limits prevent an individual from evading the base limits by making multiple contributions to other committees that would then, in turn, transfer those funds to the candidate the donor sought to support. The plurality concluded that other provisions of federal law now address concerns about circumvention and that still other measures could be adopted by Congress, if it wanted to do so, without raising the same First Amendment concerns.

“We conclude,” Justice Roberts wrote for the plurality, “ that the aggregate limits do little, if anything, to address [the corruption] concern, while seriously restricting participation in the democratic process. The aggregate limits are therefore invalid under the First Amendment.”

In dissent, Justice Stephen Breyer, joined by Justices Ruth Bader Ginsburg, Sonia Sotomayor and Elena Kagan, argue that “today’s decision eviscerates our Nation’s campaign finance laws, leaving a remnant incapable of dealing with the grave problems of democratic legitimacy that those laws were intended to resolve.”

The dissenting justices argue that the Court’s decision defines corruption too narrowly, looking only to “quid pro quo” corruption – in other words, the giving of funds in exchange for official action. “The anticorruption interest that drives Congress to regulate campaign contributions is a far broader, more important interest than the plurality acknowledges,” Justice Breyer writes. “It is an interest in maintaining the integrity of our public governmental institutions.”

Although a major decision, the practical impact of McCutcheon may not be obvious. Among campaign donors, very few currently bump up against the aggregate cap. In addition, wealthy donors may already contribute unlimited amounts to so-called super PACs and similar groups, and they may also make independent expenditures of any amount to support a particular candidate.

However, the decision is very significant in that it represents an important step in the evolution of the Supreme Court’s campaign finance jurisprudence. Taken together with Citizens United, which invalidated a prohibition on corporate expenditures to influence federal elections, McCutcheon reveals a Court willing to reconsider long-standing principles of federal campaign finance law.

In the coming months and years, we expect additional repercussions from the case.  It will likely lead to the greater use by federal candidates of joint fundraising committees, which allow a candidate to seek contributions for a single committee that benefits multiple candidates and committees (e.g., a committee that benefits a group of candidates, their leadership PACs, and multiple party committees).  In addition, the McCutcheon decision will no doubt lead to legal challenges to the handful of state laws that impose aggregate limits on contributions to non-federal candidates and committees in those jurisdictions (e.g., New York, Maryland, and Massachusetts all have aggregate limits in place).

We will continue to monitor developments in this area. Please contact DLA Piper with any questions about the impact of the Court’s decision in McCutcheon or other political law matters.

Topics:  Aggregation Rules, FEC, McCutcheon v. FEC, Political Contributions, SCOTUS

Published In: Constitutional Law Updates, Elections & Politics Updates, Finance & Banking Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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