Category Archives: McCutcheon v FEC

Texas Supreme Court hearing in Texas Democratic Party v. King Street Patriots, Inc.

The Texas Supreme Court heard arguments today in part of Texas Democratic Party v. King Street Patriots, Inc.  The Texas Election Code allows private parties to sue political opponents for alleged violations of campaign finance law, and the Texas Democratic Party and some of its candidates sued KSP in 2010 for allegedly acting as a “political committee” as defined in Texas law without registering with the Ethics Commission, and for making corporate political contributions, which are prohibited.  (There is no allegation that actual money was transferred; the allegation is that KSP’s activities resulted in deemed in-kind contributions to certain candidates by training poll watchers, etc.).

I went to Austin to watch the argument.   More to come on this case later, but I wanted to post an initial reaction to the argument.  Among other things, because the plaintiffs are claiming KSP made an illegal corporate contribution, KSP brings a facial challenge to the Texas ban on corporate contributions (which applies to both nonprofits and for-profit corporations).  The attorney for the Democratic Party focused his argument on convincing the Court that if the Texas corporate contribution ban is struck down, it will “open the floodgates” to anonymous contributions funneled to campaigns through sham corporations set up to serve exactly that purpose.  This is misleading.

In fact, just like federal law, Texas law already bans undisclosed earmarking.  In other words, it is illegal in Texas to give money to an intermediary (individual or organization) earmarked for a campaign, without disclosing the true source of the contribution (that is, without informing the campaign of the true source of the funds so the campaign can report the true source).  TEC Rule 22.3 (effective since 1993) states that “[a] person may not knowingly make or authorize a political contribution or political expenditure in the name of or on behalf of another unless the person discloses the name and address of the person who is the true source of the contribution.”  1 Tex. Admin. Code 22.3.

The U.S. Supreme Court has already indicated that the government cannot point to a hypothetical horrible that is “already illegal under current campaign finance laws” to justify additional restrictions on First Amendment-protected contributions.  McCutcheon v. FEC, 134 S. Ct. 1434, 1456 (2014).  Notably, the hypothetical rejected by the McCutcheon Court relied on already-illegal earmarking, just as the hypothetical offered by the Texas Democratic Party attorney today.  In McCutcheon, the government claimed the aggregate limits were necessary because, otherwise, a single person could write a huge check to a joint fundraiser, where each participant would then conspire to transfer its portion of the contribution to a pre-ordained ultimate recipient, which would then spend the money to support a single candidate.  The Court correctly pointed out that “this speculation relies on illegal earmarking.”  Id. at 1455.

There are many aspects of this case.  But the Democratic Party clearly wants to scare the Texas Court into following this theme of anonymous corporate cash. It is a ruse that ignores current Texas law (although nobody cited this provision today). The Court would err if it were to take the bait, as McCutcheon instructs.

Shaun McCutcheon and David Bossie (of Citizens United) appear together on free speech panel at 2014 Republican Leadership Conference

Yesterday the 2014 Republican Leadership Conference in New Orleans kicked off with a panel on free speech.  The panel featured the plaintiffs in the two most recent landmark First Amendment campaign finance cases, Shaun McCutcheon (who successfully challenged the federal aggregate limits) and David Bossie (president of Citizens United).  This was the first time the plaintiffs from McCutcheon and Citizens United have been featured together to discuss their cases.  Jerad Najvar, one of McCutcheon’s attorneys in the lawsuit, moderated the discussion.  Former FEC commissioner Hans Von Spakovsky was also on the panel.

2014 RLC panel

Jerad Najvar (moderator), Hans von Spakovsky, Shaun McCutcheon, David Bossie.

Hat tip to Ali Akbar (@Ali) for the pic via Twitter.

“Najvar and Backer: A Supreme Win for Free Speech in Politics”

Opinion piece by myself and Dan Backer that ran in The Washington Times yesterday.  Too many commentators and reporters arrive at the wrong conclusion about McCutcheon because they ask the wrong question:

The question is not, as many commentators have framed it, whether “rich” people should be allowed to make many contributions. The question is whether government has any good reason to limit such activity, or to target any individual or group to restrict their liberty.

“Supreme Court strikes down overall limit on campaign giving”

Washington Times story with a quote from Jerad Najvar, one of McCutcheon’s attorneys, and snippit of video interview.  Quote:

“The court really committed itself to what it already said many times before, in fact since Buckley: that the only government interest that’s sufficient in this area is addressing quid pro quo corruption, and the court in McCutcheon narrowly defines quid pro quo corruption, which means dollars for political favors,” Mr. Najvar said.

“The ACLU and the McCutcheon Case”

HT to the Election Law Blog for linking to these SCOTUSblog posts:

First, SCOTUSblog posted an excerpt of an upcoming ebook on McCutcheon.  The excerpt explains the divisions within the ACLU and between ACLU and its former officials in past campaign finance cases.

Then, ACLU’s Steven Shapiro responded here, with a “rejoinder” from the ebook’s authors.

#McCutcheon opinion watch! ICYMI: Najvar and Backer op-ed on why McCutcheon must win

With each working day at the United States Supreme Court that passes, we get closer to a decision in McCutcheon. It could come tomorrow.  Here is the op-ed by myself and Dan Backer, which originally ran in October, on why a victory for Shaun McCutcheon would be an important victory for the First Amendment in all contexts.

Smart Pieces Regarding #McCutcheon Today by Brad Smith and Democratic Attorney Bob Bauer

Center for Competitive Politics President (and Capital University Law Professor) Brad Smith’s take in the National Review Online: Objecting to the Declaration of Independence?

Democratic election law attorney Bob Bauer’s criticism of Lawrence Lessig’s novel corruption theory appears on Bauer’s blog, More Soft Money Hard Law: “Dependence Corruption” Before the Supreme Court

David Gans of the Constitutional Accountability Center offers an unpersuasive response to Bauer’s criticism here. For starters, even if one completely accepts CAC’s submission that the Founders were focused on so-called “institutional” corruption, not corruption of individuals, it remains to establish how an institution made up of elected individuals becomes corrupt.  There is no answer offered to the central argument in McCutcheon–that no single candidate is corrupted just because another candidate or political committee received an amount-limited contribution.