Federal Judiciary

Election subsidy challenged

By Akin Gump Supreme Court Practice Group

Candidates running for state offices in Arizona this year, and paying for their campaigns only with private funds, went to the Supreme Court Tuesday to try to stop the state from passing out public funds to their opponents who are running only with public financing.  In an application seeking three kinds of protection against the funds’ distribution, the non-subsidy candidates made their plea to Justice Anthony M. Kennedy, the Circuit Justice for the area including Arizona, who is likely to pass the issue on to the full Court, as he did with an earlier, similar challenge in February.

The case is a test of an Arizona “clean elections” law, adopted by voters in 1998 and used in five elections in the state, that encourages candidates for statewide offices to rely on public financing rather than turning to private contributions, in hopes of reducing the influence of big money on politics.  The law provides that those who opt for public funding get escalating subsidies if their non-subsidized candidates raise significantly greater amounts of private money.  The candidates without subsidies contend that this curbs their First Amendment right to raise and spend money, penalizing them by turning their added campaign efforts into further underwriting for their opponents.  Their application (09A1133) in McComish, et al., v. Bennett, et al., seeks to rely in part on the Supreme Court’s controversial ruling in January in Citizens United v. Federal Election Commission (08-205).

While Arizona’s primary election is not until Aug. 24, the new application argued that state officials are expected to start passing out so-called “matching” funds from the state treasury to subsidized statewide candidates as soon as May 28 — this Friday.  Thus, the application asked Justice Kennedy (and potentially the full Court) to take action before that date.  Justice Kennedy on Tuesday afternoon told state officials to respond by this Thursday, at noon.  After that, Kennedy or the full Court could act promptly.

The May 28 date was cited as the likely point for triggering “matching” funds because then, or by June 1, the Ninth Circuit Court is expected to put into effect a decision it made last Friday, rejecting the constitutional challenge to the Arizona law.  The application thus asks the Court to block the Circuit Court from issuing its mandate — the first of three forms of relief.  Second, the candidates asked that the Supreme Court wipe out a Feb. 1 order by the Ninth Circuit blocking a ruling by a federal judge in Arizona that had struck down the subsidy scheme.  U.S. District Judge Roslyn O. Silver on Jan. 20 found that the law would put an unconstitutional burden on the campaign finance freedom of non-subsidized candidates, and thus curb their freedom of political speech.

The third plea in the application said that, if the Court does not lift the Circuit Court’s stay order and state officials then are free to start passing out “matching” funds, the Supreme Court should require the state to post a “substantial bond” that would seek to compensate the non-subsidized candidates if they ultimately win the case.  Such a bond would represent what they might have to forgo in raising and spending money this election cycle in order to avoid triggering the matches to subsidized candidates. The application suggested that the bond be set at nearly $2.2 million, based on the amount of matching funds passed out during the last election for governor, in 2006, adjusted upward for inflation.

The challengers in the case are the same ones who asked Justice Kennedy and the Court in February to wipe out the Circuit Court’s stay order (application 09A736).  On Feb. 16, the full Court refused to do so, but that order said that the plea could be renewed ”on June 1, 2010, or when the Court of Appeals has issued its decision on the merits of the case, whichever is earlier.”   The Circuit Court opinion on the merits came on on May 21, leading to Tuesday’s renewed application.

“If the Ninth Circuit’s appellate stay order stands and its mandate issues,” the application argued, “freedom of speech will be chilled and punished.”  Non-subsidized state candidates will stop spending campaign money to get out their messages “for fear of triggering matching funds to opponents,” it said.  It quoted one candidate as saying that he and his supporters already are hesitating to put more money into his campaign because of the financial reward that would provide their opponents.

The new plea relies upon the Supreme Court’s Citizens United decision by arguing that that ruling undercut the argument that supporters of the ARizona candidate subsidy scheme made for it when it was first adopted by the state’s voters — that is, that it would reduce corruption by reducing reliance on private financing and “end the money chase.”  The Citizens Unied ruling, the application contended, limits government’s authority to restrict campaign financing to situations that involve “quid pro quo” corruption — that is, trading campaign donations for favors by elected public officials.

The application also argued that the Arizona scheme is invalid under the Supreme Court’s 2008 ruling in Davis v. Federal Election Commission, striking down a provision in federal campaign finance law (the so-called “Millionaire’s Amendment”) that sought to offset the effect on less-well-off federal candidates when they were running against rich candidates financing their own campaigns.

The Ninth Circujit, in upholding the Arizona subsidy law last week, concluded that both Citizens United and Davis involved different situations, and thus did not control the Arizona case.

Full post as published by SCOTUSBLOG on May 25, 2010 (boomark / email).