Court invalidates Millionaire's Amendment (June 26, 2008)

On the last day of its term, a closely-divided Supreme Court struck down the so-called Millionaire's Amendment to the 2002 campaign finance law.

The case, Davis v Federal Election Commission, No. 07-552, was brought by Jack Davis, the wealthy Democratic candidate for Congress from New York's 26th District. The campaign reform law calls for a three-judge panel of the federal district court in the District of Columbia to preside at the trial level, with a direct appeal to the Supreme Court.

Davis had argued in the district court that the law, which essentially raises the contribution cap for those running against self-financed candidates, on its face violated both the First Amendment and the Fifth Amendment's Equal Protection Clause.

The district court rejected Davis's argument. The court explained that the statute did not violate the First Amendment because it did not impede Davis's right to spend money in support of his political message. The fact that it relaxed the financial strictures on Davis's opponent, the court reasoned, did not impair Davis and led to a higher level of speech in the race overall. The district court compared the relaxation of contribution limits for those facing wealthy opponents to constitutionally valid statutes permitting higher contribution limits for candidates who undertake publicly financed campaigns.

The district court also rejected Davis's Equal Protection Clause Argument. Davis contended that he faced more stringent reporting requirements than his opponent, resulting in an uneven burden placed on two otherwise equal candidates. The court explained that because Davis was wealthy enough to foot the bill for his own campaign, he was not situated similarly to his opponent and therefore the situation did not trigger Equal Protection Clause coverage.

The government argued in its brief to the Supreme Court that Davis lacked standing to bring the First Amendment challenge because he had pointed to no injury or disadvantage to his speech suffered as a result of the law. The FEC acknowledged that Davis had standing to sue over the enhanced reporting requirements, but dismissed them as a negligible burden upheld by other courts examining similar campaign finance laws.

The Court indicated when it placed the case on its docket that it would consider the jurisdictional question of standing to the hearing of the case on the merits.

On June 26, a 5-4 Supreme Court invalidated the amendment, including both the contribution limits and the disclosure requirements.

"While BCRA does not impose a cap on a candidate’s expenditure of personal funds, it imposes an unprecedented penalty on any candidate who robustly exercises that First Amendment right, requiring him to choose between the right to engage in unfettered political speech and subjection to discriminatory fundraising limitations," Justice Samuel A. Alito wrote for the majority. "The burden is not justified by any governmental interest in eliminating corruption or the perception of corruption."

In a dissent on the merits joined by the court’s liberal block, Justice John Paul Stevens argued that the law did not violate the First Amendment.

"The Millionaire’s Amendment quiets no speech at all," Stevens wrote. "On the contrary, it does no more than assist the opponent of a self-funding candidate in his attempts to make his voice heard; this amplification in no way mutes the voice of the millionaire, who remains able to speak as loud and as long as he likes in support of his campaign."

Justice Ruth Bader Ginsburg wrote an additional dissent on the merits of the case, which was joined by Justice Stephen G. Breyer.