Arizona Free Enterprise Club s Freedom Club PAC v. Bennett 131 S. Ct (2011)

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1 Arizona Free Enterprise Club s Freedom Club PAC v. Bennett 131 S. Ct (2011) I. INTRODUCTION Arizona Free Enterprise Club s Freedom Club PAC v. Bennett, 1 combined with McComish v. Bennett, brought before the Supreme Court of the United States an opportunity to determine the constitutionality of the matching funds scheme of the Arizona Clean Citizens Act. 2 The Court, using prior decisions regarding political speech and campaign financing, responded to the issue of whether a state can give additional funding to a publicly financed candidate in direct response to the campaigning of privately financed candidates and independent expenditure groups. The Court answered this question in the negative, holding that the Arizona law impermissibly burdens the political speech of privately financed candidates and independent expenditure groups by not serving a compelling state interest. 3 This leaves in doubt the potential effectiveness of public campaign financing plans because the decision eliminates an incentive for political candidates to choose to enter into the public financing plan over seeking private financing. Political candidates who are capable of raising funds are more likely to seek private contributions that are greater than the public financing allowances rather than handicap themselves in the campaign by choosing to use the funding from the state. The use of private funding in campaign financing leads to concerns regarding corruption or the appearance of corruption because elected officials may be pressured to support legislation or policies that favor their political contributors as well as the overall fairness of campaigning. II. STATEMENT OF FACTUAL AND PROCEDURAL HISTORY In 1998, Arizona passed the Arizona Clean Elections Act by initiative, which created a voluntary public campaign financing system in primary and general election campaigns for candidates for state office. 4 Candidates for state office had to raise a certain amount of funding, which varied depending on the office and were also forced to agree to certain restrictions and requirements, such as limitations on personal campaign expenditures S. Ct (2011). 2. Id. at Id. 4. Id. (citing ARIZ. REV. STAT. ANN , et seq. (2011) (West)). 787

2 788 OHIO NORTHERN UNIVERSITY LAW REVIEW [Vol. 38 and participation in a public debate. 5 Those who participate in the public funding system are given initial public funds to run their campaign and are granted additional matching, or equalizing, funds when certain conditions are met. 6 In primary and general elections, matching funds are triggered when the expenditures of a privately financed candidate combined with the expenditures of independent groups made in support of a privately financed candidate or in opposition to a publicly financed candidate exceed the allotted state funding for that election. 7 Under the matching funds system, publicly financed candidates receive approximately one additional dollar beyond the initial allotment for each dollar spent by a privately financed candidate, or by an independent expenditure group in support of a privately financed candidate, or in opposition to the publicly financed candidate once matching funds are triggered. 8 Matching funds cease when the publicly financed candidate receives twice the initial allotment of public funds. 9 The petitioners, past and future candidates for Arizona state office and independent groups that financially contribute to Arizona elections, filed suit in Federal District Court claiming that the matching funds provision of the law was unconstitutional. 10 The petitioners claimed that the provision penalized their free speech and burdened their ability to fully exercise their First Amendment rights. 11 The District Court agreed with the petitioners and held that the provision did burden their First Amendment rights by awarding funds to the opponent of a privately financed candidate in direct response to the speech of that privately financed candidate with no compelling state interest to justify the imposed burden. 12 A permanent injunction against enforcing the provision was also granted, but implementation was stayed to allow for an appeal by the State. 13 The Ninth Circuit Court of Appeals stayed the injunction pending appeal issued by the District Court. On appeal, the Court of Appeals reversed the ruling of the District Court, concluding that the burden placed upon the First Amendment rights of the petitioners was only minimal as no 5. Id. at (citing ARIZ. REV. STAT , , (A)(2), (A)(2) (2011) (West)). 6. Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at 2814 (citing ARIZ. REV. STAT (A), (B), and (C)(4)-(5) (2011) (West)). 7. Id. (citing ARIZ. REV. STAT (A)-(C) (2011) (West)). 8. Id. (citing ARIZ. REV. STAT (A) and (C) (2011) (West)). 9. Id. at (citing ARIZ. REV. STAT (E) (2011) (West)). 10. Id. at Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at Id. (citing Appendix to Petition for Certiorari at 69, 71, Arizona Free Enterprise Club s Freedom PAC v. Bennett, 131 S. Ct (2011) (No )). 13. Id. (citing Appendix to Petition for Certiorari, supra note 12, at 76-81).

3 2012] ARIZONA FREE ENTERPRISE 789 one was actually prevented from speaking. 14 The Court of Appeals also held that the burden was justifiable, as the State had a compelling interest in reducing political corruption. 15 The Supreme Court then stayed the decision of the Court of Appeals, vacated the stay of the injunction, and granted the petitioners request for certiorari. 16 III. THE COURT S DECISION AND RATIONALE A. The Majority Opinion Chief Justice Roberts, writing for the majority, first detailed the importance of the First Amendment right to free speech in political campaigning. 17 The majority stated that the Court has held that laws which burden political speech are to be reviewed with strict scrutiny where the government must prove that the restriction furthers a compelling interest and is tailored to achieve that interest. 18 However, the majority did note that the Court has upheld laws that impose restrictions on campaign speech when the Court found the burden to be less onerous and therefore subject to a lower level of scrutiny. 19 Although the majority noted that burdens on political speech are to be closely scrutinized, they also stated that it is possible to have a law that so minimally burdens political speech or serves such a compelling state interest that the law could withstand a constitutional challenge. The Arizona law was compared to the Millionaire s Amendment of the Bipartisan Campaign Reform Act of 2004, which was held unconstitutional in Davis v. Federal Election Commission. 20 In Davis, the Court invalidated a section of that amendment which permitted the opponent of a candidate for the House of Representatives who spent over $350,000 of his own personal funds on campaigning to collect individual contributions three times greater than that which was normally allowed while the candidate who spent more of their personal funds was still restricted by the original contribution cap. 21 The Davis Court held the Millionaire s Amendment unconstitutional because the law required a 14. Id. (citing McComish v. Bennett, 611 F.3d 510, 513, 525 (9th Cir. 2010)). 15. Id. (citing McComish, 611 F.3d at 513). 16. Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at 2816; see McComish v. Bennett, 130 S. Ct (2010), McComish v. Bennett, 131 S. Ct. 644 (2010) (cert. granted). 17. Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at 2817 (citing Eu v. San Francisco Cnty. Democratic Central Comm., 489 U.S. 214, 223 (1989)). 18. Id. at 2817 (quoting Citizens United v. Fed. Election Comm n, 130 St. Ct. 876, 882 (2010)). 19. Id. 20. Id. (citing Davis v. Fed. Election Comm n, 554 U.S. 724 (2008)). 21. Id. (citing Davis, 554 U.S. at 729).

4 790 OHIO NORTHERN UNIVERSITY LAW REVIEW [Vol. 38 candidate to choose between exercising their First Amendment right to engage in political speech without hindrance or restraint and being subjected to discriminatory fundraising limits. 22 The Davis Court also held that the imposed burden of the Millionaire s Amendment was not justified by any compelling interest advanced by the government. 23 The majority stated that the Arizona law forced a privately financed candidate to bear the burden of awarding almost an additional dollar to his opponent for each dollar he spent on his campaign when he chose to spend his own funds to finance his campaign, similar to the law in Davis. 24 The majority also took note of three major differences between the two provisions that, according to the Court, made the matching funds provision more constitutionally problematic than the law in Davis. 25 First, the law in Davis required a candidate who benefitted from the law to actually raise the campaign contributions whereas the law at issue awards the candidate the additional matching funds automatically, creating a heavier burden than in Davis. 26 Second, the matching funds provision creates a multiplier effect, as additional funds are awarded to all publicly financed candidates when a privately financed candidate spends his own money. 27 In a case where two of the three candidates for an office are publicly financed, each dollar spent by a privately financed candidate generates two dollars against him, creating an even greater burden than seen in Davis. 28 Finally, the Arizona law differs from the law in Davis because independent expenditure groups also have an impact on the campaign awards of publicly financed candidates, which was unseen in Davis. 29 Independent expenditure group spending, which is spent irrespective of the other candidates in an election, would also generate additional matching funds to publicly financed candidates regardless of the spending concerns of privately financed candidates. 30 Additionally, these funds awarded to publicly financed candidates can be spent in whatever manner the candidates deem necessary, while the privately financed candidates have no control in how the independent 22. Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at 2818 (quoting Davis, 554 U.S at 739). 23. Id. (quoting Davis, 554 U.S. at ). 24. Id. (quoting Davis, 554 U.S. at 739). 25. Id. (citing Green Party of Conn. v. Garfield, 616 F.3d 213, (2nd Cir. 2010)). 26. Id. at Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at Id. 29. Id. 30. Id.

5 2012] ARIZONA FREE ENTERPRISE 791 expenditure group spend its money, giving an additional advantage to the publicly financed candidate over the privately financed candidate. 31 The burden of the Arizona law on independent expenditure groups, the Court stated, is even greater on those groups than on privately financed candidates in some regards. 32 These groups do not have the option of participating in the public financing system and therefore have only two options when deciding how to spend their money in a political campaign once matching funds have been triggered: change their advertisements to attack the issues and not the candidates they oppose or simply not participate in the campaign. 33 The State of Arizona attempted to distinguish the matching funds provision from the Davis law by highlighting that Davis focused on how the law in Davis created asymmetrical contribution limits that are not present in the Arizona law. 34 The majority however disagreed and held that the case at issue dealt with the burdening of political speech, like Davis, and therefore required a compelling state interest in order to withstand scrutiny. 35 The State contended that the law actually created more speech by promoting free and open issue-based debate. 36 Unconvinced by the State s argument, the majority rejected that notion by stating that only the speech of publicly financed candidates was fostered and the speech of privately financed candidates and independent expenditure groups was reduced. 37 Arizona s grant of funds to publicly financed candidates as a direct result of the speech of privately financed candidates and independent expenditure groups was also likened to the burden presented in Miami Herald Publishing Co. v. Tornillo. 38 In Tornillo, a Florida law that required newspapers to allow political candidates to print a reply to an attack on that candidate s character was held unconstitutional as the law deterred newspapers from speaking in the first place. 39 The State maintained, however, that this case was distinguishable from Tornillo, as the Arizona law did not require any person or group from expressing a message with which they did not agree. 40 This argument was quickly disposed of by the 31. Id. 32. Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at Id. at Id. at 2820 (citing Davis, 554 U.S. at 729). 35. Id. 36. Id. (quoting Brief of Respondent-Appellee State at 41, Arizona Free Enterprise Club s Freedom PAC v. Bennett, 131 S. Ct (2011) (No )). 37. Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at (quoting Buckley v. Valeo, 424 U.S. 1, 19, (1976)). 38. Id. at 2821 (citing Miami Herald Publishing Co. v. Tornillo, 418 U.S. 241 (1974)). 39. Id. (quoting Pac. Gas & Electr. Co. v. Public Util. Comm n of Cal., 475 U.S. 1, 10 (1968)). 40. Id. (quoting Brief of Respondent-Appellee State, supra note 36, at 41).

6 792 OHIO NORTHERN UNIVERSITY LAW REVIEW [Vol. 38 Court as Chief Justice Roberts stated that the political speech of one results in a direct subsidy to a publicly financed candidate to promote their speech over that of the original speaker, which is still a burden on speech nonetheless. 41 The majority similarly disposed of the State s attempt to analogize the Arizona law to the permissible burden of disclosure and disclaimer requirements established in Citizens United v. Federal Election Commission. 42 Those burdens, the majority stated, are not analogous to the Arizona law as a candidate s disclosure of funding resources does not result in a cash windfall to his opponent. 43 The Court also showed that the law has burdened candidates by citing several instances of candidates and independent expenditure groups refraining from fundraising and not speaking in order to avoid triggering matching funds. 44 Furthermore, the majority refused to accept the claim that because spending on state elections has not fallen to the matching funds triggering amount, the law has not had a deterring effect on candidates. 45 This refusal was based on the premise that while candidates may still be willing to bear the burden of triggering matching funds, that willingness does not negate the burden itself. 46 The State noted that there exists no assertion that if the State were to give an amount equal to the full matching funds allotment upfront as one lump sum the law would still impermissibly burden their speech, which the majority acknowledged. 47 The State therefore reasoned that there should be no qualms with dispensing the funds bit by bit. 48 The majority denied this line of reasoning by explaining that the amount of money was not at issue, but the way in which it was awarded, in direct response to the speech of those in opposition, created the problem. 49 The majority also denied an assertion made by the United States that the matching funds provision does nothing to make the speech of the first speaker less effective. 50 The 41. Id. at Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at 2822; see 130 St. Ct. 876 (2010). 43. Id. 44. Id. 45. Id. at 2823 (citing Brief of Respondent-Appellee State, supra note 36, at 39; Brief of Respondent-Appellee Clean Elections Institute at 18-19, Arizona Free Enterprise Club s Freedom PAC v. Bennett, 131 S. Ct (2011) (No )). 46. Id. 47. Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at 2824 (quoting Brief of Respondent-Appellee State, supra note 36, at 56). 48. Id. 49. Id. 50. Id. (quoting Brief for United States at 27, Arizona Free Enterprise Club s Freedom PAC v. Bennett, 131 S. Ct (2011) (No )).

7 2012] ARIZONA FREE ENTERPRISE 793 majority found this argument similarly unpersuasive contending that an answered advertisement is less effective than one left unanswered. 51 Having established that the Arizona law does place a burden on speech, the majority then turned to investigate whether there is a compelling government interest served that would justify the burden. 52 First, the majority determined whether the goal of the law was to level the electoral playing field by equalizing resources as the petitioners asserted, 53 or whether the law served to combat corruption and the appearance of corruption as the Respondents claimed. 54 To decide this, the majority looked at a several aspects of the law itself: the effect of law, which was to ensure equal funding up to a certain amount; 55 the language of the law, which explicitly titled the matching funds system Equal funding of candidates ; 56 and a provision in the law that permitted publicly financed candidates to seek private contributions in the amount of the matching funds allowance in the case that the Citizens Clean Election Commission could not provide the candidate with necessary funds. 57 The majority determined that the law was enacted with the goal of leveling the electoral playing field, rejecting the argument that the law was intended to combat corruption. 58 The provision allowing publicly financed candidates to seek private contributions if the Citizens Clean Election Commission could not provide the funds 59 was found to be especially counterproductive as a corruption fighting tool as the majority noted that limiting these contributions has been the primary means of fighting corruption upheld by the Court. 60 The majority was similarly unconvinced by the State s assertion that the law sought to end the possibility of quid pro quo corruption between candidates and the private interests that fund them by eliminating contributions from those private interests, due to the fact that the drafters of the law chose language that detailed the effect of equalizing 51. Id. 52. Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at 2824 (quoting Davis, 554 U.S. at 740). 53. Id. at (quoting Brief of Petitioner-Appellant McComish et al. at 64, McComish v. Bennett (No ), combined with Arizona Free Enterprise Club s Freedom PAC v. Bennett, 131 S. Ct (2011) (No )). 54. Id. at 2825 (quoting Brief of Respondent-Appellee State, supra note 36, at 42; Brief of Respondent-Appellee Clean Elections Institute, supra note 45, at 47). 55. Id. 56. Id. (citing ARIZ. REV. STAT. ANN (2010) (West Supp.)). 57. Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at 2825 (citing ARIZ. REV. STAT. ANN (F) (2006) (West)). 58. Id. 59. Id. (citing ARIZ. REV. STAT. ANN (F)). 60. Id. (citing Buckley, 424 U.S. at 23-35, 46-47).

8 794 OHIO NORTHERN UNIVERSITY LAW REVIEW [Vol. 38 funding over combating corruption. 61 The Court has repeatedly rejected leveling the playing field in campaigning as a justification for undue burdens on political speech 62 as this requires a determination as to which strengths should be allowed to contribute to the outcome of an election, 63 which the majority contends is a dangerous enterprise that cannot justify burdening protected speech. 64 Even if the Arizona law was intended to combat corruption, the Court contended the burden on speech would still not be justified. 65 Concluding that the State missed the mark in combating corruption, the majority stated that self-funding actually reduces the risk of corruption, 66 at least of quid pro quo corruption as the influence of outside contributors is reduced. 67 Furthermore, the majority explained that the Arizona law does not combat corruption with regards to independent expenditure groups 68 because independent expenditures are, by definition, not coordinated with the candidates that benefits from the speech. 69 Additionally, the Respondents claimed that the law indirectly promoted the anticorruption interest by enticing enough candidates to participate in the public funding system, which helps combat corruption itself. 70 While majority conceded that eliminating the improper influence of large private contributors can further a compelling state interest, 71 the Court further explained that the Arizona law does not meet this standard as the improper influence of large contributors is only indirectly eliminated with regards to those candidates who chose to participate in the matching funds system. 72 By concluding that the Arizona law was intended to equalize funds amongst electoral candidates and did not actually combat corruption, 73 the majority easily found that the Arizona matching funds provision did not serve a compelling state interest to justify the burden the law placed on political speech protected by the First Amendment. 74 Therefore, a Id. (Brief of Respondent-Appellee State, supra note 36, at 45, 46). 62. Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at Id. at 2826 (quoting Davis, 554 U.S. at 742). 64. Id. 65. Id. 66. Id. (quoting Davis, 554 U.S. at ). 67. Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at 2826 (quoting Buckley, 424 U.S. at 53). 68. Id. (quoting Citizens United, 130 S. Ct. at 910). 69. Id. (quoting Citizens United, 130 S. Ct. at 910). 70. Id. 71. Id. at 2827 (quoting Buckley, 424 U.S. at 96). 72. Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at Id. at Id. at 2828.

9 2012] ARIZONA FREE ENTERPRISE 795 majority reversed the decision of the Ninth Circuit, invalidating the matching funds provision of the Arizona law. B. The Dissenting Opinion Justice Kagan, joined by Justices Breyer, Ginsburg, and Sotomayor, dissented from the Court s holding. 75 The dissent characterized the Arizona law as one that is non-discriminatory, creates more speech, broadens public debate, and could ultimately end campaign corruption within the State. 76 Maintaining that the purpose of the First Amendment is to foster a political system that has discussion and debate, the dissent disagreed with the majority s view on the constitutionality of the Arizona law and found that the law serves the constitutional purpose of promoting free political discussion so that the government is more responsive to the people. 77 After stating that goal of campaign finance reform is to end political quid pro quo corruption, 78 the dissent discussed the presidential public financing system at issue in Buckley v. Valeo that granted only a lump sum to participants and was held to be constitutional as that system used public money to create more public debate and political participation without restricting or censoring speech. 79 However, the Buckley plan had one major drawback: the absence of a method to set the subsidy at a level which would give candidates an incentive to participate in the system. 80 Yet public financing systems will also waste public funds if the grants are too large, especially if the races are not competitive, according to the Court. 81 Public financing systems must be voluntary 82 and candidates will choose to not participate in the program if they are unable to run competitive races with the publicly granted funds. 83 Even spending predictions based on past elections are almost impossible to make due to the dynamic nature of the electoral system. 84 In an attempt to create an effective system which combats corruption, Arizona enacted the plan at issue 85 after a previous law establishing 75. Id. at 2829 (Kagan, J., dissenting). 76. Id. 77. Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at 2830 (Kagan, J., dissenting) (quoting New York Times Co. v. Sullivan, 376 U.S. 254, 269 (1964)). 78. Id. (citing Buckley, 424 U.S. at 26). 79. Id. at 2831 (quoting Buckley, 424 U.S. at 92-93). 80. Id. 81. Id. at Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at 2831 (Kagan, J., dissenting). 83. Id. 84. Id. at Id.

10 796 OHIO NORTHERN UNIVERSITY LAW REVIEW [Vol. 38 campaign contribution limits 86 failed to bring about the desired effect. 87 The plan, according to the dissent, was able to provide an incentive that attracted candidates to participate in the plan the matching funds provision where other lump sum plans failed to provide such an incentive. 88 The Arizona plan was able to give candidates enough funds to stay competitive against privately funded candidates and was able to avoid unnecessary state spending, saving taxpayers dollars. 89 The dissent characterized the Arizona law as one that produced more political speech through the use of subsidies, and therefore did not cause any First Amendment injury. 90 Justice Kagan claimed that the law did not prevent anyone from speaking, 91 did not tell candidates or their supporters how or when they could use their money to convey their message 92 and actually funded more speech. 93 The dissent also pointed out a judicially recognized distinction between restrictions on speech and speech subsidies stating that speech subsidies have been upheld so long as they do not discriminate based on viewpoint. 94 The Arizona law, Justice Kagan held, is non-discriminatory and therefore cannot be said to violate the First Amendment s requirements for speech subsidies. 95 Justice Kagan characterized the suit by claiming that the petitioners were asserting that they have had their rights infringed upon because the State dispersed funds to other speakers when they themselves refused to accept those funds, though they were available to them, and stated that the petitioners were seeking to suppress the speech of others by stopping the subsidy program. 96 Furthermore, Justice Kagan stated that the First Amendment does not prevent any person s right to be free from vigorous debate, 97 actually exists to encourage that kind of political debate, 98 and 86. Id. 87. Arizona had a scandal which saw nearly 10% of its legislators accepting bribes or campaign contributions in exchange for legislative support after the law was enacted. Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at 2832 (Kagan, J., dissenting). 88. Id. 89. Id. at Id. 91. Id. (quoting Citizens United, 130 S. Ct. at 914). 92. Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at 2833 (Kagan, J., dissenting). 93. Id. 94. Id. at 2834 (quoting Bd. of Regents of Univ. of Wis. Sys. v. Southworth, 529 U.S. 217, 234 (2000)). 95. Id. 96. Id. at Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at 2835 (Kagan, J., dissenting) (quoting Pac. Gas & Electr. Co., 475 U.S. at 14). 98. Id.

11 2012] ARIZONA FREE ENTERPRISE 797 stated that public financing of elections does not prohibit but instead fosters the principles of the First Amendment. 99 Addressing the majority s opinion, Justice Kagan was similarly critical, stating that the majority was wrong to hold that the Arizona law constituted a substantial burden on expression. 100 The dissent stated that the law did not impose any penalty and that the only burden was funding for responsive political speech. 101 Justice Kagan did concede that the matching funds provision does make the speech of privately funded candidates and independent expenditure groups less effective due to the responsive and competitive speech that is funded by the provision and that a candidate may even be deterred from spending money, but these still do not constitute substantial burdens on speech. 102 Additionally, the dissent made three assertions derived from prior precedent to defend the Arizona law. 103 First, the Arizona plan is likened to a lump-sum public financing system, which the Court has held to impose an acceptable burden on speech. 104 As both plans fund publicly financed candidates and therefore deter speech by diminishing the effectiveness of privately financed candidates, the Arizona law should be upheld on the same grounds as lump sum plans. 105 Second, if disclosure and disclaimer requirements have been found to be constitutional then the Arizona plan should similarly be upheld. 106 As the Court has previously held that disclosure and disclaimer requirements are constitutionally permissible despite the fact that they may deter speech and burden expression, 107 the dissent reasoned that the Arizona plan should also be held as an acceptable burden. 108 Third, the matching funds provision imposed no greater burden on speech than previously upheld contribution limits and therefore should also be upheld. 109 The dissent attacked the majority s use of Davis to justify their decision to strike down the matching funds provision. 110 In an attempt to distinguish Davis, the dissent characterized the pivotal factor of that case as one candidate s expenditure triggering a discriminatory speech restriction 99. Id. at 2836 (citing Buckley, 424 U.S. at 93 n.127) Id Id. at Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at 2837 (Kagan, J., dissenting) Id. at Id. at Id Id. at Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at 2838 (Kagan, J., dissenting) Id Id. at Id. at 2839.

12 798 OHIO NORTHERN UNIVERSITY LAW REVIEW [Vol. 38 inconsistent with the First Amendment while holding that the Arizona law gives a non-discriminatory speech subsidy. 111 This view is held because the Davis decision focused only on discriminatory contribution limits. 112 The dissent furthered this position by noting that the Davis Court did not invalidate the triggering mechanism itself, but the effect of the triggering mechanism. 113 The Arizona plan however issues a non-discriminatory subsidy which the Court has upheld in the past; therefore, the Arizona law should not be held to violate the First Amendment simply because the triggering mechanism in the Arizona law is similar to that found in Davis. 114 Having found that the Arizona law does not impermissibly burden speech, the dissent continued to defend the law by asserting that the law does serve a compelling state interest, namely preventing corruption, which has been held by the Court as a compelling state interest when dealing with campaign finance. 115 Candidates may fall to corruption and serve private contributors in order to win elections, but public financing can reduce this by removing the importance of private contributors. 116 To justify the contention that the Arizona law is supposed to combat corruption, Justice Kagan cited the title of the law, The Citizens Clean Elections Act, and the formal findings of the statute. 117 This corruption fighting program, the dissent maintained, was a simple fine-tuning of the approved lump sum plan in Buckley that does not prevent speech, and like the plan in Buckley, does serve a compelling state interest. 118 The dissent also contended that the majority mischaracterized Arizona s purpose for the plan and avoided the State s actual argument by claiming that the plan was to achieve equal footing in elections rather than fighting corruption. 119 The dissent maintained that the majority misinterpreted the title of the law by asking only what the title said and not why the title was written that way. 120 Furthermore, the dissent stated that the majority misread the provision of the law that allowed publicly financed candidates 111. Id Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at 2840 (Kagan, J., dissenting) (citing Davis, 554 U.S. at 740) Id Id. at Id Id The findings state that the public financing program was inten[ded] to create a clean elections system that will improve the integrity of Arizona state government by diminishing the influence of special interest money. Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at (Kagan, J., dissenting) (citing ARIZ. REV. STAT. ANN (A) (2011) (West)) Id. at (citing Id. at 2826 (majority opinion)) Id. at 2843 (Kagan, J., dissenting) Id. at

13 2012] ARIZONA FREE ENTERPRISE 799 to raise funds from private contributors if the State could not provide promised funding as proof that the law was intended to equalize funds and level the playing field. 121 The dissent claimed that that provision of the law was simply included to ensure that the publicly funded candidates could run a competitive campaign if the matching funds scheme could not allocate those funds as promised. 122 Finally, the dissent stated that the Court has decided against well-established precedent by maintaining that two compelling interests must be served in order to justify a restriction on the First Amendment instead of only one. 123 By finding that the law does serve to combat corruption, the majority should have been satisfied according to the dissent, but Chief Justice Roberts instead required some justification for equalizing funds. 124 The Arizona law, according to the dissent, should survive constitutional scrutiny and be upheld. 125 IV. ANALYSIS A. Introduction The expansion of Davis that brought about the Court s holding was neither unforeseeable nor an unreasonable extension of the law. However, the way the Court arrives at the opinion is more complex than necessary. The Davis law was struck down because it imposed a discriminatory speech restriction on some candidates. 126 To broaden Davis, the Court needed to find that the speech subsidies granted in the Arizona law amounted to restrictions on speech. The Court also needed to find that the restrictions did not serve a compelling state interest. The Court was able to show that the law restricted speech and, through an unnecessary argument well criticized by the dissent, found that the interest served by the law was not able to justify the restriction on speech presented. With this extension of the recent Supreme Court decisions in Davis and Citizens United, a clear trend emerges: anything that prohibits a candidate from spending in a campaign constitutes a burden on speech and will not withstand judicial scrutiny Id. at Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at 2844 (Kagan, J., dissenting) Id. at Id. at Id Campaign Finance Regulation, 122 HARV. L. REV. 375, 377 (2008).

14 800 OHIO NORTHERN UNIVERSITY LAW REVIEW [Vol. 38 B. The Burden on Speech Both the majority and the dissent acknowledge the importance of the right of free political speech granted by the First Amendment. 127 However, they differ greatly in determining what constitutes a burden. The majority seems to follow a continuation of the finance reform principles in Davis by maintaining that any law which punishes a candidate for speaking by granting his opponent the ability to raise more funds imposes a substantial burden on the freedom of political speech. 128 This extension does broaden the holding in Davis but is by no means a labored reading of the Davis principles. The law struck down in Davis allowed candidates to raise funds in excess of normal contribution limits if their opponents spent more than $350,000 of their own funds on campaigning while the self-funding candidate was still restricted by the original limits. 129 The Court reasonably found the Arizona law similarly burdensome as a candidate was allowed to obtain additional funding in response to the expenditures of an opponent and suggested that the law was potentially even more burdensome as an automatic grant was given where the law in Davis at least required the candidate to raise his own money. 130 According to the majority, this flows from the principle in Davis that funding in response to the expenditures of others constitutes a burden on speech because a candidate is required to choose between exercising their right to speech and risk granting their opponent additional funding, or refraining from speaking altogether. 131 While the majority broadened the scope of Davis, the dissent claimed that Davis is not even controlling in this case as Davis dealt with speech discrimination. 132 The sticking point for the dissent then is whether the Arizona law restricts speech or grants a subsidy which would promote speech. Justice Kagan s dissent on this point seems to mirror Justice Stevens dissent in Davis which asserted that speech is promoted by granting more money to candidates. 133 However, granting funds to promote the speech of one candidate in response to the actions of another candidate or an independent expenditure group seems to be promoting the speech of 127. See Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at 2817 (majority opinion) (citing Eu, 489 U.S. at 223) Jeremy Earl, Case Comment, Davis v. FEC: The First Amendment Rights of a Wealthy Candidate, 4 DUKE J. CONST. L. & PUB. POL Y SIDEBAR 89, 92 (2008) See Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at 2817 (citing Davis, 554 U.S. at 729) See id. at See id. at 2818 (quoting Davis, 554 U.S. at 739) Id. at 2839 (Kagan, J., dissenting) Id. at ; see also Davis, 554 U.S. at (Stevens, J., dissenting).

15 2012] ARIZONA FREE ENTERPRISE 801 one at the expense of others. The dissent briefly acknowledged this by admitting the Arizona law made the speech of the privately financed candidate less effective, but quickly countered by claiming that the burden was not substantial. 134 The majority combated this contention by broadening the holding in Tornillo. 135 The Court in Tornillo feared that requirements to allow opposing sides to speak at their expense would burden free speech. 136 While the Arizona law does not compel a candidate to speak on behalf of his opponent, like the law in Tornillo, granting funds to one side because their opposition has spoken may cause candidates to refrain from speaking in the first place and could skew the marketplace of ideas because they are aware that their speech will directly cause their opposition to be able to respond. 137 This is a burden on speech which must be justified by a compelling state interest. 138 However, the Tornillo holding dealt with what newspapers could be forced to print. 139 The Arizona law does not require privately funded candidates to spend money on behalf of their publicly financed opponents, nor does it require those candidates to endorse statements made by their opponents. The expansion of Tornillo could lead to a slippery slope where any government law or regulation that might prevent someone from speaking could be seen as a substantial burden. However, the majority enforces this claim with evidence that some candidates have actually refrained from speaking. 140 The majority appears to find that more speech is created by allowing candidates to spend as much money as they can. The majority does maintain that some restrictions on campaign speech can survive scrutiny. 141 Taking this into account, the majority does not seem to be trying to remove all attempts at clean elections, but is certainly not permitting any restriction that may cause political participants to refrain from spending money. 142 The Court has shown that it is not willing to remove all attempts at clean elections as it has upheld the campaign speech restrictions presented 134. Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at 2837 (Kagan, J., dissenting) Id. at (majority opinion) (citing Tornillo, 418 U.S. at 241) Tornillo, 418 U.S. at Caroline Mala Corbin, The First Amendment Right Against Compelled Listening, 89 B.U. L. REV. 939, 979 (2009) Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at Josephine I. Aiello, Case Comment, Congressional Cable-Vision: Turner Broadcasting v. Federal Communications Commission, 8 HARV. J.L. & TECH. 231, 238 (1994) Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at Id. at See Campaign Finance Regulation, supra note 126, at 382.

16 802 OHIO NORTHERN UNIVERSITY LAW REVIEW [Vol. 38 in Citizens United and Buckley. In Citizens United, the Court did not restrict the amount of money that could be given by corporations or unions, but it did uphold disclosure requirements. 143 Requiring people to publish where they received their funding and granting funds to an opponent because a candidate spoke are two very different notions. Disclosure requirements will not make a candidate choose to not speak but will only require them to be open with where they obtained funding. 144 Again, the Court seems to be protecting the right of people to spend money in order to speak but is willing to allow some small burdens on speech in order to make elections more open to the public. The Court also upheld the lump sum grant clean election plan previously approved in Buckley and even stated that the State could have granted an amount equal to the entire grant of funds a publicly funded candidate could receive as one lump sum without violating First Amendment rights. 145 The dissent maintained that if the lump sum in Buckley was not a substantial burden on free political speech, the small alteration of the plan to include a matching funds provision should similarly be upheld. 146 However, the issue the court faces with this plan is not the amount of money given but how it is distributed. The dissent claims that the lump sum plans also reduce the effectiveness of the speech of privately funded candidates and can be quite burdensome depending on the size of the grant. 147 However, this seems to miss the point of the majority opinion. If the grant were so substantial that a candidate would choose not to run because they would be outspent, as the dissent suggests, 148 they are likely to run as a publicly financed candidate. More importantly, the majority objects to what causes the funds to be granted: the speech of another candidate. 149 The majority cannot look beyond the fact that one candidate s speech, or the speech of an independent expenditure group, directly causes a candidate in opposition to receive more money to do with as they please. This is a burden that will prevent a candidate from speaking to prevent their opponents from getting additional funding whereas the lump sum plan 143. Richard Briffault, Privacy, Democracy, and Elections, Two Challenges for Campaign Finance Disclosure After Citizens United and Doe v. Reed, 19 WM. & MARY BILL RTS. J. 983, 993 (2011) Citizens United, 130 S. Ct. at 914 (quoting Buckley, 424 U.S. at 64) Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at 2831 (Kagan, J., dissenting) (quoting Buckley, 424 U.S. at 92-93) Id. at Id. at See id Id. at 2821 (majority opinion).

17 2012] ARIZONA FREE ENTERPRISE 803 would not prevent speech because the publicly funded candidate already has the money and, at that point, there is no reason not to speak. 150 C. Compelling State Interest Having arguably established that the Arizona law does impose a burden on political speech, the Court requires a compelling state interest to justify the law. 151 Typically, the underlying reason recognized by courts for campaign finance reform laws has been preventing corruption, particularly quid pro quo corruption. 152 However, the majority participated in a strict textualist argument that characterized the Arizona law as trying to level the proverbial playing field. 153 Financing schemes, like the Arizona plan, have been given the rationale of leveling financial disparity between candidates. 154 While a reasonable analysis of the Arizona law, the majority s claim is somewhat shortsighted. The Court seems to be saying that there can be only one reason for enacting a law and, in this case, that reason was to level the playing field by equalizing funds. 155 The majority defends this position by citing a provision of the law that allows publicly funded candidates to seek private contributions if the State is unable to provide the promised funds. 156 While this does lean towards proving an underlying reason of leveling the playing field, as the dissent points out, that provision acts more as a security net than an indicator of the purpose of the law. 157 The majority s reading is not necessarily as incorrect as the dissent asserts, rather, the reading is simply narrow minded as the majority does not look beyond the operation and effect of the law to the underlying reason for the provision: providing a safety net to entice candidates to participate in the plan. 158 The argument of whether the purpose of the law is to level the playing field or to combat corruption was a largely unnecessary discussion engaged in by the majority. Rather than arguing over the underlying principles of the law, the majority could have very simply conceded that the state interest for the law was fighting corruption and that the law simply failed on that front as the 150. See Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at Id. at 2817 (quoting Citizens United, 130 S. Ct. at 888) John M. de Figuieredo & Elizabeth Garrett, Paying for Politics, 78 S. CAL. L. REV. 591, 622 (2005) See Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at See Campaign Finance Regulation, supra note 126, at See Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at Id. at See id. at 2844 (Kagan, J., dissenting) Id.

18 804 OHIO NORTHERN UNIVERSITY LAW REVIEW [Vol. 38 majority stated that the anti-corruption was not served. 159 Campaign finance precedent has established that the government must show that any restriction on speech be narrowly tailored to meet a compelling government interest. 160 The law, the majority correctly asserts, is not narrowly tailored to serve the State s anti-corruption interest. 161 First, the majority states that reducing self-funding does not stop corruption. 162 Personal funding actually reduces the risks of quid pro quo corruption. 163 If the State is seeking to prevent corruption by removing the influence of private contributors, removing self-funding does nothing to serve the State s interest; therefore, the law is not narrowly tailored to serve a compelling interest. 164 To this argument, the dissent does not appear to have a response. In addition to the issue of self-funding, the majority also discusses the effect on independent expenditure groups. 165 Courts have held that the anticorruption interest is not served by burdening the speech of independent expenditure groups. 166 Simply put, quid pro quo corruption is not a concern in campaigning because candidates and the independent expenditure groups do not coordinate their campaigning efforts. 167 If the independent expenditure groups are spending money to support or oppose a particular candidate because that is the political stance of the group without regard to any candidate s own campaign (hence the term independent ), it cannot be said that the possibility of quid pro quo corruption exists between the group and any candidate. The dissent contends that Arizona implemented the public financing law to reduce political corruption by diminishing the role of private donors in campaigns. 168 While this may be an accurate statement of the intent of the State, the law goes far beyond reducing the influence of private donors by burdening the candidates themselves, as well as independent expenditure groups. While the Arizona law could be said to serve a compelling state interest, it cannot be maintained that the law is narrowly tailored to serve that interest. Given these arguments, the majority s claim that the only 159. See id. at 2826 (majority opinion) J. Robert Abraham, Note, Saving Buckley: Creating a Stable Campaign Finance Framework, 110 COLUM. L. REV. 1078, 1083 (2010) See Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at Id Earl, supra note 128, at Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at 2826 (quoting Buckley, 424 U.S. at 53) Id. at Abraham, supra note 160, at Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at 2826 (quoting Citizens United, 130 S. Ct. at 910) Id. at 2842 (Kagan, J., dissenting).

19 2012] ARIZONA FREE ENTERPRISE 805 purpose of the law is to level the electoral playing field, and the rather strained argument in support, is unnecessary because the law could have been invalidated without that claim. V. CONCLUSION The 5-4 holding in Arizona Free Enterprise Club s Freedom Club PAC leaves the future of campaign finance reform in doubt. The recent trend of the Court has been to remove any hindrances to spending in campaigns. 169 With that in mind, the Court s decision is understandable, if not expected. Currently, disclosure requirements and contribution limits are still constitutionally permissible. The Court s rhetoric does not appear to put those campaign finance reform provisions in jeopardy. Presumably, if the Court wanted to rid the nation of disclosure requirements and contribution limits that could have been done when the Court was recently presented with the opportunity. The Court also explicitly states it will not go into the policy of public financing but will make sure that finance reform is consistent with the First Amendment. 170 Yet with no incentive for candidates to participate in the program, the dissent is correct in asserting that finance reform attempts will largely have no teeth. Campaign finance reform is dealt a blow in this decision, but whether it is fatal will have to be seen by how states create laws in response to this decision and how the Court treats this line of cases in response to those laws. BRANDYN M. BUTLER 169. See Davis, 554 U.S. 724, Citizens United, 130 S. Ct Ariz. Free Enterprise Club s Freedom Club PAC, 131 S. Ct. at 2828 (majority opinion).