Important First Amendment Supreme Court Decision Cruises Under the Radar

July 21, 2022   •  By Barnaby Zall   •    •  , ,

Every spring, bold, controversial Supreme Court decisions splash across news media, obscuring more subtle, but important, decisions that don’t get the same attention. Federal Election Commission v. Ted Cruz for Senate, No. 21-12, 596 U.S., 142 S.Ct. 1638 (May 16, 2022), was one of those important, but not highly publicized, First Amendment decisions. Its importance came from signaling to lower courts and legislators that the Court meant what it said in earlier cases protecting free expression, rather than from its direct result: the substantive invalidation of a limit on post-election campaign contributions that harmed challengers and new candidates.

FEC v. Cruz’s most important signal may be the current Court’s six-vote majority support for First Amendment protections for political speech, sending a strong message that legislators and lower courts should not play fast and loose with constitutional limits on government regulation of political expression: “the First Amendment requires us to err on the side of protecting political speech rather than suppressing it.” FEC v. Cruz, slip op., at 16, quoting, McCutcheon v. FEC, 572 U.S. 185, 209 (2014).

In particular, the decision buttressed recent Court decisions requiring legislators and regulatory agencies to have solid evidence of problems they claim as justification for regulation rather than speculating about possible problems: “We have ‘never accepted mere conjecture as adequate to carry a First Amendment burden.’” (FEC v. Cruz, slip op., at 15, quoting McCutcheon, 572 U.S. at 210). Friend of the court briefs from the Institute for Free Speech (pp. 4-5, 7-8, 11) and other organizations (e.g., Public Policy Legal Institute (pp. 19-23)) had asked the Court to issue such a reinforcing message, citing McCutcheon and other cases.

To some degree, ignoring FEC v. Cruz was understandable. It was a highly technical case about an obscure provision of complex federal campaign finance law. The specific question was whether Senator Ted Cruz’s re-election campaign could repay his large personal loans to his campaign with contributions made after the election. Because Senator Cruz had won his prior Senate elections (including his 2018 re-election fight which, between Cruz and his opponent, Beto O’Rourke, brought in more than $100 million in contributions), some dismissed the question as not really a big deal in practical terms.

Still, there were plenty of indications that this decision could be important. First, the law limited funding for political speech, a First Amendment red flag. For example, should federal law bar challengers and new candidates from using post-election contributions to repay campaign debt? Before you answer, imagine a young, vigorous newcomer, running his first campaign for the U.S. Senate. Not personally wealthy, and facing not only numerous well-funded contenders for the seat but a sizeable campaign debt from his first, failed challenge to a congressional incumbent, the young, scrappy candidate went “all-in,” taking out loans for the campaign. If he lost, statistics show he would never be repaid.

This isn’t a hypothetical question. It happens all the time. The most important example? In 2002, when Barack Obama announced to his friends at a fundraising brunch that he would run for the U.S. Senate seat from Illinois, they were justifiably skeptical. After all, he got “spanked” (his term) challenging an incumbent Congressman only two years prior and he was still struggling to repay $20,000 in campaign loans he used to finance the loss. As The New York Times later reported, he would take his pitch to the golf course: “And by the ninth hole, he said he needed help to clear up some debts.” Repaying his debt was critical to his success. Of course, Obama went on to win two presidential campaigns, earning a reputation as a formidable fundraiser in the process.

The Supreme Court, by a vote of 6-3, took that question head-on in FEC v. Cruz. “The First Amendment has its fullest and most urgent application precisely to the conduct of campaigns for political office. … This broad protection, we have explained, reflects our profound national commitment to the principle that debate on public issues should be uninhibited, robust, and wide-open.” FEC v. Cruz, slip op., at 10. The Court continued:

Debt is a ubiquitous tool for financing electoral campaigns. The raw dollar amount of loans made to campaigns in any one election cycle is in the nine figures. … And more than 90% of campaign debt consists of candidate loans. In fact, candidates who self-fund usually do so using personal loans.

The ability to lend money to a campaign is especially important for new candidates and challengers. As a practical matter, personal loans will sometimes be the only way for an unknown challenger with limited connections to frontload campaign spending. And early spending— and thus early expression—is critical to a newcomer’s success. A large personal loan also may be a useful tool to signal that the political outsider is confident enough in his campaign to have skin in the game, attracting the attention of donors and voters alike.

By inhibiting a candidate from using this critical source of campaign funding, however, [the federal restriction] raises a barrier to entry—thus abridging political speech.

FEC v. Cruz, slip op., at 12-13 (internal citations omitted).

Justice Kagan, for herself and Justices Breyer and Sotomayor, dissented, arguing that permitting repayment of loans by those who contributed after the election posed a special threat of quid pro quo corruption (dollars for official actions):

A candidate for public office extends a $500,000 loan to his campaign organization, hoping to recoup the amount from benefactors’ post-election contributions. Once elected, he devotes himself assiduously to recovering the money; his personal bank account, after all, now has a gaping half-million-dollar hole. The politician solicits donations from wealthy individuals and corporate lobbyists, making clear that the money they give will go straight from the campaign to him, as repayment for his loan. He is deeply grateful to those who help, as they know he will be—more grateful than for ordinary campaign contributions (which do not increase his personal wealth). And as they paid him, so he will pay them.

FEC v. Cruz, (Kagan, J., dissenting), slip op., at 1.

But this case was about more than just repaying campaign debt; it also had a second, more general, point: a government wanting to limit expression can’t just claim that bad things might happen if the expression is heard; it must demonstrate that the danger is real and significant enough to justify limits on funding for political speech. In other words:

Because the Government is defending a restriction on speech as necessary to prevent an anticipated harm, it must do more than “simply posit the existence of the disease sought to be cured.” It must instead point to “record evidence or legislative findings” demonstrating the need to address a special problem. We have “never accepted mere conjecture as adequate to carry a First Amendment burden.” …

Yet the Government is unable to identify a single case of quid pro quo corruption in this context—even though most States do not impose a limit on the use of post-election contributions to repay candidate loans.

FEC v. Cruz, slip op., at 15 (citations omitted).

Traditionally, when a regulatory agency with special expertise in an area opines on something, a reviewing court generally defers to the agency’s technical expertise. But it is the Supreme Court, not federal regulatory agencies, which holds the special expertise in deciding what is constitutional under the First Amendment and what is not. This Court has been cutting back on deference to agency expertise, including in American Hospital Association v. Becerra, No. 20-1114 (June 15, 2022), where the unanimous Court rejected an agency’s contention that it could regulate without evidence that its action was justified.

Here, the FEC was unable to point to any evidence of “a single case of quid pro quo corruption in this context.” FEC v. Cruz, slip op., at 15. That would ordinarily suggest the agency was relying on “mere conjecture as adequate to carry a First Amendment burden.” Id. Conjecture would not be enough.

Sadly, the agency in FEC v. Cruz did more than guess; the FEC attempted to manufacture its own evidence. And did so badly. Although the Court has said prevention of “an appearance of corruption” can justify candidate and party contribution limits, the term “appearance” is not defined. Some courts have looked at public opinion polls or testimony of campaign consultants or politicians for such evidence.

As former President Obama can attest, money is necessary in politics, especially for newcomers; it doesn’t automatically mean that those who need the money are corrupt. And we assume that candidates who are elected will listen to their supporters; it’s what we expect in a representative democracy. More to the point, it may be impossible to draft a public opinion poll that will gather accurate and relevant information sufficient to justify such a limit on expression.

Nevertheless, after this case was filed, the FEC drafted a public opinion poll and hired the YouGov polling firm to identify public opinion on repaying candidate loans. The poll was badly-drafted; even the people running and analyzing it didn’t really know what the questions meant. More importantly, they were not the questions the Supreme Court wanted to hear about.

The Supreme Court slapped down the FEC for having inadequate evidence to justify its limit on campaign expression:

The Government instead puts forward a handful of media reports and anecdotes that it says illustrate the special risks associated with repaying candidate loans after an election. But as the District Court found, those reports “merely hypothesize that individuals who contribute after the election to help retire a candidate’s debt might have greater influence with or access to the candidate.” That is not the type of quid pro quo corruption the Government may target consistent with the First Amendment.

The dissent at points shrugs off this distinction, but our cases make clear that “the Government may not seek to limit the appearance of mere influence or access.” As we have explained, influence and access “embody a central feature of democracy—that constituents support candidates who share their beliefs and interests, and candidates who are elected can be expected to be responsive to those concerns.” … “the First Amendment requires us to err on the side of protecting political speech rather than suppressing it.” …

The evidence here is scant, and Congress’s judgment is hardly based on “vast amounts of data.” Moreover, deference to Congress would be especially inappropriate where, as here, the legislative act may have been an effort to “insulate[] legislators from effective electoral challenge.”

In the end, it remains our role to decide whether a particular legislative choice is constitutional. … And here the Government has not shown that [the statute] furthers a permissible anticorruption goal, rather than the impermissible objective of simply limiting the amount of money in politics.

FEC v. Cruz, slip op. at 16, 21-22 (citations omitted).

There is also an “inside baseball” indicator, to trained eyes, of substantial importance: the 6-3 FEC v. Cruz majority opinion strongly reinforces earlier cases. It’s a “we really mean it” decision, reinforcing a trend or strengthening an earlier decision or line of cases. Here, that line of cases begins with Buckley v. Valeo, 424 U.S. 1 (1976) at the dawn of modern campaign finance cases, and continues through Citizens United v. FEC, 558 U.S. 310 (2010) and McCutcheon v. FEC, 572 U.S. 185 (2014).

McCutcheon, the most recent of these prior cases, was itself a “we really mean it” decision, reinforcing Citizens United’s application of the First Amendment at a time when Citizens United was new and particularly controversial. McCutcheon, however, was a “plurality” decision, meaning it got five votes in favor of the result, but Justice Thomas wrote an opinion concurring in the result, and asking for even more protection for expression. Some lower courts refused to apply McCutcheon in cases where it ought to have been applied; for example, the Ninth Circuit held in Lair v. Motl, 873 F.3d 1170 (9th Cir. 2017) that it was sufficient for Montana to posit some “risk” of an appearance of corruption. But five judges in that case dissented to the denial of rehearing en banc, noting:

In short, the majority applies a legal standard inconsistent with Citizens United and McCutcheon, and as a result, relies on evidence of access or influence that cannot prove Montana’s state interest in restricting contribution limits. As Judge Bea explains in dissent, “[w]hile the panel majority’s opinion pays lip service” to Citizens United and McCutcheon’s shift, its analysis utterly fails “to account substantively for this change.” 873 F.3d at 1191 (Bea, J., dissenting). Rather than follow Citizens United and McCutcheon, the majority undermines them. I would follow the Supreme Court and require Montana to present evidence of actual or apparent quid pro quo corruption.

Lair v. Motl, 889 F.3d 571, 577 (Mem) (9th Cir. 2018) (Ikuta, J., dissenting from denial of rehearing en banc).

FEC v. Cruz was forceful and clear. And it got six votes. Though not cited, Judge Ikuta’s underlying message resonates loudly in FEC v. Cruz.

Those six votes matter. The Cruz opinion repeatedly cited McCutcheon’s plurality opinion as binding precedent, giving that case a needed boost in legitimacy. See, e.g., FEC v. Cruz, slip op., at 13 (“See McCutcheon v. Federal Election Comm’n, 572 U. S. 185, 210 (2014) (plurality opinion) (“When the Government restricts speech, the Government bears the burden of proving the constitutionality of its actions.”), id. (“under either standard, the Government must prove at the outset that it is in fact pursuing a legitimate objective. See McCutcheon, 572 U. S., at 210.”), id. (“This Court has recognized only one permissible ground for restricting political speech: the prevention of “quid pro quo” corruption or its appearance. See [McCutcheon], at 207; see also Federal Election Comm’n v. National Conservative Political Action Comm., 470 U. S. 480, 497 (1985).”).

Cruz is a forceful restatement of the current Court’s intention to protect political speech vigorously, especially when it affects those who do not enjoy power, and it clarifies that governments must justify, with specific evidence, attempts to suppress expression. And it shows lower courts and legislators that there are now six votes in favor of strongly protecting political speech. FEC v. Cruz will likely be cited for its evidentiary requirement for speech regulation in many major political speech cases going forward.

Not a ruling that got front-page or online click-bait headlines, but important nonetheless.

Barnaby Zall

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