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REPUBLICAN NATL. COMM. v. FEC

November 30, 1978

REPUBLICAN NATIONAL COMMITTEE et al., Plaintiffs,
v.
FEDERAL ELECTION COMMISSION, Defendants



The opinion of the court was delivered by: GAGLIARDI

Plaintiffs Republican National Committee ("RNC"), the Ripon Society of New York, Inc. ("Ripon Society"), Paul C. Cardamone and John A. Schmid have brought this action for declaratory and injunctive relief. Plaintiffs challenge those portions of federal law which condition the receipt of federal campaign funds by presidential candidates upon compliance with campaign expenditure limits and forbearance from raising contributions to defray campaign expenses. The named defendants are the Federal Election Commission ("FEC") and its individual members, Attorney-General Griffin Bell and Secretary of the Treasury W. Michael Blumenthal. *fn1" Jurisdiction is premised upon 2 U.S.C. § 437h, 26 U.S.C. § 9011 and 28 U.S.C. §§ 1331, 2201 and 2202. Defendants have moved to dismiss the complaint for lack of subject matter jurisdiction and for failure to state a claim. Plaintiffs have moved for an order convening a three-judge district court. Finally, Common Cause, David Cohen and Nan Waterman have moved to intervene as defendants in this action.

The statutory scheme challenged by plaintiffs is contained in both the Presidential Election Campaign Fund Act, codified as Chapter 95 of Subtitle H of the Internal Revenue Code of 1954, as amended in 1974, ("Subtitle H"), 26 U.S.C. §§ 9001-9013, and the Federal Election Campaign Act ("FECA"), 2 U.S.C. §§ 431-55. 26 U.S.C. § 9006 establishes the "Presidential Election Campaign Fund" on the books of the United States Treasury. The Secretary of the Treasury is charged with transferring monies to this fund not in excess of the amounts designated by federal taxpayers under the tax-checkoff mechanism set forth in 26 U.S.C. § 6096. *fn2" To be eligible to receive payments from the fund, a candidate of a "major party" defined in 26 U.S.C. § 9002(6) as a party whose candidate in the preceding presidential election received at least 25% Of the total popular vote must certify to the FEC, under penalty of perjury, that: 1) he or she will not incur "qualified campaign expenses" *fn3" in excess of the aggregate payments from the fund to which he or she will be entitled under § 9004; and 2) he or she will not accept contributions to defray such expenses except to the extent necessary to make up any deficiency in payments received out of the fund on account of insufficient taxpayer check-offs. 26 U.S.C. § 9003(b). The amount to which each major party candidate is entitled under § 9004 cannot exceed the campaign expenditure *fn4" limitations set forth in the Federal Election Campaign Act, I. e., $ 20 million as adjusted for increases in the cost of living. 2 U.S.C. § 441a(b)(1)(B), (c). Thus, to receive public campaign funds the presidential candidate must limit campaign expenditures to approximately $ 20 million and, barring deficiencies in the fund, may not accept any private contributions to defray campaign expenses.

 Plaintiffs in this action are the national committee of the Republican party, a New York corporation with politically active members of the Republican party and two individual party members. Their complaint sets forth six causes of action. First, they contend that the statutory scheme described above violates the First Amendment in that it conditions eligibility for federal campaign funds upon compliance with unconstitutional expenditure limitations and thereby restricts the ability of candidates and their parties, supporters and contributors to communicate their ideas. Second, they allege that the statutes are unconstitutional because the Republican presidential candidate in 1980 must, as a result of certain "legal and practical factors", accept federal campaign funding and thereby agree to comply with the unconstitutional expenditure limits. Plaintiffs contend that the raising of small contributions within the Federal Election Campaign Act's contribution limitations is time consuming and that the Republican nominee in 1980 probably will not be able to begin fund raising for the general election until after he or she is nominated. Doubt as to the timely availability of private funds is allegedly likely to hamper budgeting and reduce campaign activities, such as television broadcasts, which must be paid for in advance. These legal and practical factors effectively require the presidential candidate to accept public funding. Once the candidate does so, the statutory scheme limits the expenditures that may be made and prohibits the acceptance of contributions with the following results: the limits on campaign expenditures allegedly induce candidates to concentrate on campaign activities which give them great exposure at relatively low cost mass media advertising at the expense of local organizational, "grass roots" activities; and the prohibition on direct campaign contributions, no matter how small, allegedly limits individual citizens in their ability to engage in political communication.

 As a third cause of action, plaintiffs assert that the statutory scheme unconstitutionally discriminates against candidates challenging incumbent Presidents in violation of the First and Fifth Amendments. Contending that it is likely that the Republican presidential candidate in 1980 will run against an incumbent, plaintiffs complain that the expenditure limits will discriminate against the Republican challenger. Incumbent presidents have the advantage of free publicity; virtually all of their activities are inherently newsworthy. Moreover, incumbent Presidents have the significant resources of the executive branch from speechwriters and political advisors to jet planes and limousines at their disposal during election campaigns. The limitations on campaign expenditures allegedly preclude challengers from commanding equivalent public attention.

 As a fourth cause of action plaintiffs allege that the statutory scheme's conditioning of federal funding upon compliance with expenditure limitations discriminates against candidates who are not politically allied with a substantial number of labor organizations in violation of the First and Fifth Amendments. Plaintiffs contend that it is unlikely that the Republican presidential candidate in 1980 will be supported by a substantial number of labor organizations. Under the FECA, 2 U.S.C. § 441b, labor organizations are permitted to spend unlimited amounts of money which do not count against the $ 20 million limit on a candidate's campaign expenditures to communicate with members and their families "on any subject" and to conduct non-partisan registration and get-out-the-vote drives among members and their families. Plaintiffs allege that there is a high degree of coordination among labor organizations in carrying out these activities which can, in turn, be fully coordinated with the activities of the principal campaign committee of a presidential candidate. Although plaintiffs acknowledge that 2 U.S.C. § 441b grants corporations the same rights of communication with respect to their shareholders and executive or administrative personnel, they contend that labor organizations have a number of practical advantages in communicating with their membership on political matters, E. g., the ability to impose and collect dues, geographic concentration of union membership and ready access to potential members. Plaintiffs estimate that in 1976, disbursements by labor organizations on behalf of President Carter's campaign exceeded $ 11 million, or approximately 50% Of the adjusted expenditure amount permitted under the statutory scheme. Consequently, the Carter campaign allegedly spent 150% Of the amount spent by the Ford campaign.

 For their fifth and sixth causes of action respectively, plaintiffs allege that the statutory scheme is both unconstitutionally overbroad under the First and Fifth Amendments and in violation of their retained rights under the Ninth Amendment.

 Defendants' motion to dismiss raises two distinct objections to the complaint. First, defendants argue that plaintiffs' various constitutional objections were rejected by the Supreme Court in Buckley v. Valeo, 424 U.S. 1, 96 S. Ct. 612, 46 L. Ed. 2d 659 (1976). Buckley involved a broad constitutional attack against both the FECA and Subtitle H. The Court invalidated the FECA's campaign expenditure ceilings in Part I of its 144-page per curiam opinion, but stated that:

 
For the reasons discussed in Part III, Infra, Congress may engage in public financing of election campaigns and may condition acceptance of public funds on an agreement by the candidate to abide by specified expenditure limitations. Just as a candidate may voluntarily limit the size of the contributions he chooses to accept, he may decide to forgo private fundraising and accept public funding.

 424 U.S. at 57, 96 S. Ct. at 653, n.65. In Part III of the opinion, the Court held that Subtitle H: 1) was within Congress's Article I, § 8 power to legislate for the "general welfare"; 2) did not, by analogy to the prohibition against public spending contained in the Religion Clause of the First Amendment, violate the Free Speech Clause of that amendment; and 3) was not invidiously discriminatory against minor and new parties in violation of the Fifth Amendment. Id. at 86-108.

 Defendants' second ground for dismissal is based upon the "case or controversy" requirement of Article III. Defendants contend that plaintiffs' speculative scenario for the 1980 presidential election and the statutory scheme's effect thereon does not present this court with the "ripe" controversy necessary to the exercise of judicial power. See, e.g., United Public Workers v. Mitchell, 330 U.S. 75, 67 S. Ct. 556, 91 L. Ed. 754 (1947); Clark v. Valeo, 182 U.S.App.D.C. 21, 559 F.2d 642, Aff'd sub nom. Clark v. Kimmitt, 431 U.S. 950, 97 S. Ct. 2667, 53 L. Ed. 2d 267 (1977). As to the fourth cause of action only, defendants also argue that the "political question" doctrine bars any consideration of the claim that FECA and Subtitle H discriminate against candidates without substantial labor organization support because there are no judicially manageable standards for resolution of such a claim. See Baker v. Carr, 369 U.S. 186, 82 S. Ct. 691, 7 L. Ed. 2d 663 (1962).

 Plaintiffs, of course, dispute both defendants' reading of Buckley and their assessment of the justiciability of the issues presented. Moreover, as a threshold matter, plaintiffs argue that this court ought not decide defendants' motion to dismiss at the present time. For the reasons stated below, the court agrees and declines to decide the motion to dismiss.

 Both the FECA and Subtitle H contain unusual provisions for judicial review. 2 U.S.C. § 437h(a), the FECA provision, states:

 
The Commission, the national committee of any political party, or any individual eligible to vote in any election for the office of President of the United States may institute such actions in the appropriate district court of the United States, including actions for declaratory judgment, as may be appropriate to construe the constitutionality of any provision of this Act. The district court immediately shall certify all questions of constitutionality of ...

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