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Citizens United v. FEC and the Future of Federal Campaign Finance Reform

The U. S. Supreme Court case of Citizens United v. Federal Election Commission, will test the constitutionality of important elements of federal campaign finance legislation. How the Court rules could significantly alter the government’s ability to regulate federal political campaign funding and set limits for future campaign financing reform efforts. The Supreme Court heard the case’s oral argument on March 24, 2009 but did not produce an opinion during the term that ended in June. A reargument on certain issues was heard on September 9, 2009.

This case involves Citizens United (Citizens), a tax-exempt, nonprofit corporation that produced a documentary movie about Hillary Clinton to coincide with the 2008 election cycle. Entitled “Hillary: The Movie,” and featuring personalities such as Ann Coulter and Dick Morris, Citizens’ documentary critically reviewed Clinton’s record as First Lady, senator and presidential candidate and expressed opinions about whether or not she would make a good president. Citizens planned releases of and advertising for the movie around important milestones of the 2008 election—state presidential primaries and caucuses, the Democratic National Committee Convention, and the presidential election.

Citizens’ plans potentially conflicted with sections 201, 203 and 311 of the Bipartisan Campaign Reform Act of 2002 (“BCRA”), Pub. L. No. 107–155, 116 Stat. 81 (2002), also known as the McCain–Feingold Act, which amended the Federal Election Campaign Act of 1971 (“FECA”), Pub. L. No. 92-225, 86 Stat. 3 (1972). (Federal election law is codified in Chapter 14 to Title 2 to the United States Code (U.S.C.) See also the Federal Election Commission publication Federal Election Campaign Laws.)

Section 203 of BCRA regulates the purchase of “electioneering communications.” Generally, these are “broadcast, cable, or satellite” communications made within 60 days of a general election or 30 days of a primary election. 2 U.S.C. § 434(f)(3)(A)(i) Section 203 restricts corporations and labor unions from funding electioneering communications from their general funds except under certain specific circumstances, e.g., get-out-the-vote campaigns. 2 U.S.C. § 441b(b)(2) Permissible “electioneering communications” are subject to BCRA’s disclosure and disclaimer requirements under sections 201 and 311.

Section 201 of BCRA contains a donor disclosure provision for electioneering communications. Persons who disburse an aggregate of $10,000 or more a year for the production and airing of electioneering communications are required to file a statement with the Federal Election Commission (FEC). The statement must include the names and addresses of persons who have contributed in excess of $1,000 to accounts funding the communication. 2 U.S.C. § 434(f)(1) & (2)

BCRA’s section 311 contains a disclaimer provision for electioneering communications. The entity responsible for the communication, if not authorized by the candidate or the candidate’s political committee, must contain a statement that the organization “is responsible for the content of this advertising.” 2 U.S.C. § 441d

Citizens foresaw that its movie and advertising might be considered electioneering communications subject to BCRA's sections 201, 203 and 311. It therefore sought an injunction to block the FEC from enforcing those sections on the grounds they violated the First Amendment to the U.S. Constitution. BCRA’s section 403 sets rules for constitutional challenges to its provisions. Such claims are to be adjudicated by a three-judge panel of the United States District Court for the District of Columbia. Appeals from this court go directly to the United States Supreme Court. 2 U.S.C. 437h note

The District Court refused to grant Citizens’ request in Citizens United v. FEC, 530 F. Supp. 2d 274 (D.D.C. 2008). The court noted that the Supreme Court upheld BCRA’s section 203 in McConnell v. FEC, 540 U.S. 93, 115 (2003) and rejected the argument that the funding of electioneering communications “constituting express advocacy or its functional equivalent” is protected under the Constitution’s First Amendment. “As applied” challenges--specific applications of the law to certain communications--are a different matter. In FEC v.Wis. Right to Life, Inc., 551 U.S. (2007) (WRTL), the high court held that advertisements only constitute express advocacy or its functional equivalent if they are “susceptible of no reasonable interpretation other than as an appeal to vote for or against a specific candidate.” The district court held that Citizens’ movie was the “functional equivalent of express advocacy”—its critique of Clinton’s presidential character, candidacy, and qualifications was intended to influence voters that she should not be elected

While the movie may have been subject to BCRA section 203, the FEC conceded that advertising for the movie was not. However, Citizens objected to BCRA’s disclosure and disclaimer requirements, claiming they did not apply because they were not “express advocacy or the functional equivalent” under WRTL. The district court held that McConnell and WRTL did not apply that standard to the disclosure and disclaimer requirements, provisions to which the Supreme Court had shown some approval in the past.

Citizens appealed the case to the U.S. Supreme Court, challenging the constitutionality of BCRA sections 201, 203 and 311. Brief for Appellant Citizens United

After hearing arguments on the case in March 2004, the Supreme Court did not render an opinion on the case. Instead the case was rescheduled for reargument on whether or not the court should reverse prior holdings sanctioning laws that restrict how corporations can make political contributions. The Court phrased its question in this way:

For the proper disposition of this case, should the Court overrule either or both Austin v. Michigan Chamber of Commerce, 494 U.S. 652 (1990), and the part of McConnell v. Federal Election Comm’n, 540 U.S. 93 (2003), which addresses the facial validity of Section 203 of the Bipartisan Campaign Reform Act of 2002, 2 U.S.C. §441b?

The Austin opinion held that a Michigan law that prohibited non-media corporations from using general funds to make political contributions, requiring such contributions to be made through “separate segregated funds” set up for political purposes, was constitutional. As noted above, McConnell held that section 203 in BCRA is also constitutional. If the Supreme Court overrules these precedents, Congress could be constitutionally prohibited from regulating most forms of corporate and union campaign spending.

Oral argument on these issues was held on Wednesday, September 9, 2009. This was the first case heard by Associate Justice Sonia Sotomayor, who replaced Associate Justice David Souter.

Records, Briefs and Cases for Citizens United v. FEC
	District Court Decisions Citizens United v. FEC, 2008 US Dist (DC) 39 (07-2240 Jan. 15, 2008) Citizens United v. FEC, 2008 US Dist (DC) 40 (07-2240 Jan. 16, 2008) Citizens United v. FEC, 2008 US Dist (DC) 65 (07-2240 Jul. 18, 2008) Supreme Court Materails Docket Sheet Briefs on original questions and September 9, 2009 reargument Transcript of March 24, 2009 Oral Argument Order restoring case to the calendar for reargument on September 9, 2009 (see page 2) Transcript of September 9, 2009 Oral Argument Supreme Court Cases Implicated by Citizens United v. FEC Austin v. Michigan Chamber of Commerce, 494 U.S. 652 (1990) McConnell v. Federal Election Comm’n, 540 U.S. 93 (2003)
Federal Election Law
	Bipartisan Campaign Reform Act of 2002 (“BCRA”), Pub. L. No. 107–155, 116 Stat. 81 (2002) Federal Election Campaign Laws, 2 U.S.C. §§ 431 – 455 Federal Election Campaign Laws

Records, Briefs and Cases for Citizens United v. FEC