9th Circuit Upholds Free Speech in Some Contexts, But Not in Others

Last week, the U.S. Court of Appeals for the 9^th Circuit affirmed the district court’s decision to preliminarily enjoin a $500 limit on contributions to political committees that make only independent expenditures. The 9^th Circuit also affirmed the lower court’s ruling granting individuals, associations, and corporations the right to make unlimited contributions to committees making independent expenditures.

In Thalheimer v. City of San Diego, Plaintiff Phil Thalheimer, a former and prospective city council candidate, brought an as-applied challenge to five of San Diego’s campaign finance laws, suing to enjoin enforcement of campaign finance restrictions he claims violate his First Amendment rights.

Thalheimer was represented by RNLA Board of Governors member, James Bopp, Jr., who commented on the political party independent expenditure limit, saying:

One of the important purposes of political parties is to elect their candidates to office. It is absurd to forbid them from giving money to support their candidates. The Ninth Circuit understood that the First Amendment gives citizens the right to band together in political parties, and that political parties have a First Amendment right to financially support their candidates.

About the independent expenditure ruling, Mr. Bopp said:

The Supreme Court has ruled that there is no permissible reason for the government to limit independent expenditures themselves. This is true even when the expenditures are made by corporations. It naturally follows that if the expenditures cannot be limited, then money to groups making expenditures cannot be limited either, even when the money comes from associations and corporations.

Although there was a lot of good news in the ruling, the 9^th Circuit also exercised some judicial misinterpretation. The Court upheld the city of San Diego’s prohibition on political contributions by “non-individual entities” (e.g., corporations, labor unions, and other groups) to candidates, political parties, and other PACs that contribute to candidates. The 9^th Circuit’s holding is in direct contradiction with the ruling last week in United States v. Danielczyk, by Judge Cacheris in the Eastern District of Virginia. Judge Cacheris held that the federal prohibition against direct corporate contributions to candidates is unconstitutional under the First Amendment.

Danielczyk correctly adhered to last year’s Supreme Court ruling in Citizens United v. FEC, which stated that the government may not suppress political speech based on corporate identity. Judge Cacheris also correctly distinguished FEC v. Beaumont, which upheld a law prohibiting corporate contributions by non-profit advocacy organizations

However, the 9^th Circuit erroneously interpreted these cases, which led to their decision. Holding in direct contravention of Citizens United, the Court suppressed speech based on corporate identity by not allowing contributions by “non-individual entities.” The 9^th Circuit also chose to draw a distinction between contributions and expenditures as applied to Citizens United, instead of the broader First Amendment implications of free speech. Additionally, the Court unfairly distinguished Citizens United , stating that the holding was only limited to prosecutions within the criminal context, instead of accepting a broad ruling to be applied in all contexts.

The Court also incorrectly distinguished the holding in FEC v. Beaumont, applying it to corporations, instead of just non-profit advocacy organizations. Additionally, the Court upheld a provision prohibiting the solicitation of contributions outside of twelve months before an election. Lastly, the court upheld a ban on corporations establishing separate PACs to give to candidates. This is even stricter than federal campaign finance laws, which allow the establishment of separate PACS.

The next step would be for the 9^th Circuit to reconsider their ruling or an appeal to be filed. It is unclear whether Thalheimer will file a writ of certiorari with the Supreme Court.