U.S. Supreme Court Strikes Down Federal Contribution Limits

The United States Supreme Court today in a 5-4 decision authored by Chief Justice Roberts invalidated the federal law restriction that previously limited individuals to aggregate contributions to all Federal candidates, committees and political parties to $123,200 for a two-year election cycle. Today's Court decision in McCutcheon v Federal Election Commission stated that such limits “intrude without justification on a citizen's ability to express the most fundamental First Amendment activities.” The Court further found that, given the substantial mismatch between the Government’s stated governmental objective and the means selected to achieve it, the aggregate limits fail to survive Constitutional scrutiny.

The Federal Election Campaign Act of 1971 (FECA), as amended by the Bipartisan Campaign Reform Act (BCRA), restricts individual contributions in two ways—first by setting a maximum individual contribution to candidates (currently $2,600 per election), national political party committees (currently $32,400 per calendar year) and any other federal political action committee or PAC ($5,000 per calendar year); and second by capping the aggregate of an individual’s contributions to all candidates ($48,600 for 2013-14) and PACs and political parties ($74,600 for 2013-14). The Court found that contributing money to candidates is a core aspect of an individual’s right to participate in the electoral process through both political expression and political association, both of which are protected by the First Amendment.

In reaching its decision, the Court analyzed and left intact the seminal campaign finance case Buckley v Valeo, 424 US 1, concluding that Buckley’s conclusion regarding the FECA’s aggregate limit does not control in the instant case. Rather, the Court found that a restriction on how many candidates and committees an individual may support is more than a “modest restraint” of First Amendment rights. In contextualizing the decision with other First Amendment protections, the Court explained that “the Government may no more restrict how many candidates or causes a donor may support than it may tell a newspaper how many candidates it may endorse.”

The Court also found that the FECA’s aggregate limits do not further the permissible governmental interest in preventing quid pro quo corruption or its appearance, determining that spending large sums of money in connection with elections, but not in an effort to control the exercise an official’s duties, is not quid pro quo corruption. The Court rejected the argument that an individual spending large sums may garner influence over or access to elected officials or political parties, stating that “the line between quid pro quo corruption and general influence must be respected in order to safeguard basic First Amendment rights, and the Court must ‘err on the side of protecting political speech rather than suppressing it.’”

“Given the direction the Court has taken in recent opinions such as Citizens United, we should not be particularly surprised that the Court struck down the aggregate limits,” explained Dykema Political Compliance Team Leader Alan Wilk. “This Court clearly embraces the idea that political contributions are one of myriad types of First Amendment issues that must be protected just like free press and free religion.”

While the Court’s decision opens the door to more aggregate dollars flowing in from donors, the individual limitations per candidate still apply. Coupled with changes to other state and local campaign finance laws, such as ten states recently increasing or eliminating candidate campaign contribution limits—including Maryland, Michigan, Minnesota and North Carolina—the 2014 election cycle will create numerous questions for those interested in making or receiving contributions.

Developments in the past four years since the Citizens United case (in which Dykema participated on behalf of the Michigan Chamber of Commerce) have caused many of our clients to reevaluate the way in which they participate in political campaigns. Today’s decision will further impact the ways that the 2014 elections are funded. If you have questions about how this decision impacts you or any other political compliance or campaign strategy questions, feel free to contact Alan Wilk at 517-374-9122 or any of Dykema’s Political Compliance Team members listed to the left.

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