New filing in the case that could end super PACs

Today, we filed a petition for initial hearing en banc in the U.S. Court of Appeals for the D.C. Circuit in Lieu v. Federal Election Commission, the case that could end super PACs. The goal of the Lieu litigation is to give the D.C. Circuit, or the Supreme Court, the opportunity to overturn the D.C. Circuit’s 2010 SpeechNow decision that created super PACs. This brief is not the full case brief, but rather a request for the case to be heard by the full (en banc) court of 11 active judges, as opposed to a panel of three. Only the en banc court can overrule its own precedent, such as SpeechNow. 

The petition explains why SpeechNow was wrongly decided, why the case presents a “question of exceptional importance” justifying en banc hearing, and why the structure of this case presents an appropriate opportunity for reconsidering SpeechNow.

The case has attracted the interest of three groups of amici curiae (friends of the court) supporting our challenge: U.S. Senator Sheldon Whitehouse; Citizens for Responsibility and Ethics in Washington; and a group of empirical scholars led by Professor Christopher Robertson of the University of Arizona Law School.

Before we filed the petition for initial hearing en banc, the Federal Election Commission filed a motion for summary affirmance, arguing that the case was so clear that there was no point in full briefing. We responded to that motion in May.

BACKGROUND

Contrary to a common misunderstanding, super PACs were not created by the Supreme Court’s Citizens United decision, but by a later decision of the intermediate federal court of appeals, SpeechNow.org v. FECIn SpeechNow, the U.S. Court of Appeals for the D.C. Circuit concluded that the federal law limiting contributions to political action committees to $5,000 per person per year did not apply to political committees that promised to make only “independent expenditures.” As explained by scholars and experts in political corruption and constitutional law, the SpeechNow ruling was legally erroneous at the time under Supreme Court precedent (including Citizens United).

Unfortunately, then-Attorney General Eric Holder decided not to appeal SpeechNow to the Supreme Court, on the (clearly mistaken in retrospect) theory that the SpeechNow decision would “affect only a small subset of federally regulated contributions.” This prediction, like the court’s speculation that contributions to super PACs could not lead to corruption or the appearance of corruption, has proven incorrect with time. To this day, the Supreme Court has not reviewed the question. As a result, super PACs have become one of the primary vehicles for wealthy donors to evade campaign contribution limits designed to prevent corruption and the appearance of corruption.

Lieu v. Federal Election Commission seeks to present the courts with an opportunity to overrule SpeechNow. This case began in 2016, when Representative Ted Lieu (D-Cal.), the late Rep. Walter Jones (R-N.C.), Senator Jeff Merkley (D-Or.), State Senator (ret). John Howe (a Republican congressional candidate from Minnesota), Zephyr Teachout (a Democratic congressional candidate from New York), and Michael Wager (a Democratic congressional candidate from Ohio) filed an administrative complaint before the FEC, naming as respondents ten super PACs that had received contributions from single donors ranging from $300,000 to $5,000,000—far in excess of the existing, still-on-the-books federal $5,000 contribution limit.

WINNING IN THE EN BANC D.C. CIRCUIT

In the D.C. Circuit, which decided SpeechNow, we believe that the en banc (full) court may welcome an opportunity to reconsider SpeechNow. First, the court may appreciate the opportunity for more considered reflection in light of the developments of the past decade. SpeechNow was argued just six days after Citizens United, and few anticipated how it could lead to the creation of the super PAC—certainly not then-Attorney General Eric Holder, who decided not to appeal SpeechNow to the Supreme Court, on the (clearly mistaken in retrospect) theory that the SpeechNow decision would “affect only a small subset of federally regulated contributions.” The factual record, both in the case and in the judges’ understanding of the real world, shows how super PACs have threatened to swallow the entire campaign finance system.

Furthermore, the composition of the D.C. Circuit has changed: three judges who joined the SpeechNow decision (including its author) have left the court or taken senior status, and five new judges have joined the court since SpeechNow: two appointed by President Trump, and four appointed by President Obama. These new judges may have little compulsion to adhere to an earlier mistake. Consequently, we advised the court at the outset of the appeal that we planned to file a petition for initial hearing en banc.

Read the petition for initial hearing en banc.

Learn more about Lieu v. Federal Election Commission.

Excerpt: Introduction to the Petition

Can large contributions to super PACs corrupt or create the appearance of corruption? This Court said “no” in SpeechNow.org v. FEC, 599 F.3d 686 (D.C. Cir. 2010) (en banc), the decision that Representative Ted Lieu, Senator Jeff Merkley, and the other appellants now ask the Court to overrule. Relying on the then two-month-old decision in Citizens United v. FEC, 558 U.S. 310 (2010), SpeechNow struck down a provision of the Federal Election Campaign Act (FECA) that limited contributions to independent expenditure-only political committees (i.e. super PACs) to $5,000 per year. 52 U.S.C. §§ 30116(a)(1)(C).

The Court could not have anticipated how SpeechNow would reshape our democracy. The parties briefed SpeechNow before the Supreme Court’s decision in Citizens United v. FEC, 558 U.S. 310 (2010), and argued the case six days after that decision. The government relied heavily on pre-Citizens United arguments, see SpeechNow, 599 F.3d at 694, and did not seek an opportunity for supplemental briefing. After this Court’s decision, Attorney General Holder explained that the government did not seek certiorari because it would affect “only a small subset of federally regulated contributions.”

Holder’s declaration belongs on a historic list of wrong predictions. In the 2016 election, contributions to federal super PACs substantially outstripped the total amount of money raised by all federal candidates combined. The $2,800 limit on direct contributions to candidates still stands, but SpeechNow has rendered it “functionally meaningless.” Richard Briffault, Super PACs, 96 Minn. L. Rev. 1644, 1684 (2012). Major donors pair maximum legal contributions to candidates with multi-million dollar contributions to super PACs supporting the same candidates. Deep into the 2016 presidential primaries, nearly half of all super PAC contributions came from just 50 families. Since SpeechNow, the contributions of eleven top donors to super PACs have ranged from $38.4 million to $287 million. Even the president of SpeechNow.org did not anticipate its impact—he later observed that using an independent expenditure group to promote a particular candidate “just never entered my mind.”

Do large contributions to super PACs lead to an appearance of corruption? SpeechNow said no, but overwhelming bipartisan majorities of the public consistently say yes. The rise of super PACs is regularly denounced by statesmen as diverse as Senator John McCain (“What we have done is made a contribution limit a joke.”) and President Jimmy Carter (describing current system as “unlimited political bribery”). See Albert W. Alschuler, Laurence H. Tribe, Norman L. Eisen & Richard W. Painter, Why Limits on Contributions to Super PACs Should Survive Citizens United, 86 Fordham L. Rev. 2299, 2340-42 (2018). In 2016, both parties’ presidential candidates decried super PACs, and the victor, President Trump, declared, “[T]hese super PACs are a disaster . .  . Very corrupt. . . . There is total control of the candidates.” Id. at 2338-40.

This Court believed its ruling was compelled by Citizens United, but, as this petition will show, it was not. The proposition upon which SpeechNow depends—that if super PAC expenditures do not corrupt, contributions to super PACs cannot corrupt either—is factually inaccurate and contradicts decades of bribery law. Moreover, two recent Supreme Court decisions substantially undermine SpeechNow’s key premises.

The super PACs spawned by SpeechNow have undermined faith in our democracy, and the question of whether six or seven-figure contributions to super PACs pose a risk of corruption or its appearance is ripe for reconsideration.

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