CALIFORNIA MEDICAL ASSN. v. FEC(1981)

No. 79-1952

Argued: January 19, 1981Decided: June 26, 1981

One provision of the Federal Election Campaign Act of 1971 (Act), 2 U.S.C. 441a (a) (1) (C), prohibits individuals and unincorporated associations from contributing more than $5,000 per calendar year to any multicandidate political committee. A related provision, 441a (f), makes it unlawful for political committees knowingly to accept contributions exceeding the $5,000 limit. Appellant California Medical Association (CMA) is a not-for-profit unincorporated association of doctors, and appellant California Medical Political Action Committee (CALPAC) is a political committee formed by CMA and registered with appellee Federal Election Commission (FEC). When CMA and CALPAC were notified of an impending enforcement proceeding by the FEC for alleged violations of 441a (a) (1) (C) and 441a (f), they, together with individual members, filed a declaratory judgment action in Federal District Court challenging the constitutionality of these provisions. Subsequently, the FEC filed its enforcement proceeding in the same District Court, and CMA and CALPAC pleaded as affirmative defenses the same constitutional claims raised in their declaratory judgment action. Pursuant to the special expedited review provisions of the Act, 437h (a), the District Court, while the enforcement proceeding was still pending, certified the constitutional questions raised in the declaratory judgment action to the Court of Appeals, which rejected the constitutional claims and upheld the challenged $5,000 limit on annual contributions. Appellants sought review on direct appeal in this Court pursuant to 437h (b).

Held:

The judgment is affirmed. Pp. 187-201; 201-204.

641 F.2d 619, affirmed.

JUSTICE MARSHALL delivered the opinion of the Court with respect to Parts I, II, and IV, concluding that:

[453 U.S. 182, 183]

failed to provide any mechanism for coordinating cases in which the same constitutional issues are raised by the same parties in both a declaratory judgment action and an enforcement proceeding, as here, a direct appeal to this Court under 437h (b) should be limited to situations in which no enforcement proceedings are pending, since otherwise litigants, like appellants here, could disrupt and delay enforcement proceedings and undermine the functioning of the federal courts. Neither the statutory language nor legislative history of 437g and 437h indicates that Congress intended such a limitation. Pp. 187-192.

2. Section 441a (a) (1) (C) does not violate the equal protection component of the Fifth Amendment on the ground, alleged by appellants, that because a corporation’s or labor union’s contributions to a segregated political fund are unlimited under the Act, an unincorporated association’s contribution to a multicandidate political committee cannot be limited without violating equal protection. Appellants’ contention ignores the fact that the Act as a whole imposes far fewer restrictions on individuals and unincorporated associations than it does on corporations and unions. The differing restrictions placed on individuals and unincorporated associations, on the one hand, and on corporations and unions, on the other, reflect a congressional judgment that these entities have differing structures and purposes and that they therefore may require different forms of regulation in order to protect the integrity of the political process. Pp. 200-201.

[453 U.S. 182, 184]

views and candidacies of a number of candidates. Moreover, the challenged contribution restriction, contrary to appellants’ claim, is an appropriate means by which Congress could seek to protect the integrity of the contribution restrictions upheld in Buckley v. Valeo. Pp. 193-199.

JUSTICE BLACKMUN concluded that the challenged contribution limitation does not violate the First Amendment because it is no broader than necessary to achieve the governmental interest in preventing actual or potential corruption. Pp. 201-204.

MARSHALL, J., announced the Court’s judgment and delivered the opinion of the Court with respect to Parts I, II, and IV, in which BRENNAN, WHITE, BLACKMUN, and STEVENS, JJ., joined, and an opinion with respect to Part III, in which BRENNAN, WHITE, and STEVENS, JJ., joined. BLACKMUN, J., filed an opinion concurring in part and concurring in the judgment, post, p. 201. STEWART, J., filed a dissenting opinion, in which BURGER, C. J., and POWELL and REHNQUIST, JJ., joined, post, p. 204.

Rick C. Zimmerman argued the cause for appellants. With him on the briefs was David E. Willett.

Charles N. Steele argued the cause for appellees. With him on the brief was Kathleen Imig Perkins. *

[ Footnote * ] Bruce J. Ennis, Jr., filed a brief for the American Civil Liberties Union as amicus curiae urging reversal.

Louis R. Cohen, A. Stephen Hut, Jr., Roger M. Witten, Kenneth J. Guido, Jr., and Ellen G. Block filed a brief for Common Cause as amicus curiae urging affirmance.

JUSTICE MARSHALL delivered the opinion of the Court with respect to Parts I, II, and IV, and delivered an opinion with respect to Part III, in which JUSTICE BRENNAN, JUSTICE WHITE, and JUSTICE STEVENS joined.

In this case we consider whether provisions of the Federal Election Campaign Act of 1971, 86 Stat. 11, as amended, 2 U.S.C. 431 et seq. (1976 ed. and Supp. III), limiting the amount an unincorporated association may contribute to a multicandidate political committee violate the First Amendment or the equal protection component of the Fifth Amendment. Concluding that these contribution limits are constitutional, [453 U.S. 182, 185] we affirm the judgment of the Court of Appeals for the Ninth Circuit.

I

The California Medical Association (CMA) is a not-for-profit unincorporated association of approximately 25,000 doctors residing in California. In 1976, CMA formed the California Medical Political Action Committee (CALPAC). CALPAC is registered as a political committee with the Federal Election Commission, and is subject to the provisions of the Federal Election Campaign Act relating to multicandidate political committees. 1 One such provision, 2 U.S.C. 441a (a) (1) (C), prohibits individuals and unincorporated associations such as CMA from contributing more than $5,000 per calendar year to any multicandidate political committee such as CALPAC. 2 A related provision of the Act, 2 U.S.C. 441a (f), makes it unlawful for political committees such as CALPAC knowingly to accept contributions exceeding this limit. 3 [453 U.S. 182, 186]

In October 1978, the Federal Election Commission found “reason to believe” that CMA had violated the Act by making annual contributions to CALPAC in excess of $5,000, and that CALPAC had unlawfully accepted such contributions. When informal conciliation efforts failed, the Commission in April 1979 authorized its staff to institute a civil enforcement action against CMA and CALPAC to secure compliance with the contribution limitations of the Act. In early May 1979, after receiving formal notification of the Commission’s impending enforcement action, CMA and CALPAC, together with two individual members of these organizations, filed this declaratory judgment action in the United States District Court for the Northern District of California challenging the constitutionality of the statutory contribution limitations upon which the Commission’s enforcement action was to be based. Several weeks later, the Commission filed its enforcement action in the same District Court. In this second suit, CMA and CALPAC pleaded as affirmative defenses the same constitutional claims raised in their declaratory judgment action.

On May 17, 1979, pursuant to the special expedited review provisions of the Act set forth in 2 U.S.C. 437h (1976 ed. and Supp. III), 4 the District Court certified the constitutional questions raised in appellants’ declaratory judgment action to the Court of Appeals for the Ninth Circuit. In the meantime, pretrial discovery and preparation in the Commission’s enforcement action continued in the District Court. In May 1980, a divided Court of Appeals, sitting en banc, rejected appellants’ constitutional claims and upheld the $5,000 limit on annual contributions by unincorporated associations to multicandidate political committees. 641 F.2d 619. Appellants sought review of that determination in this Court, again pursuant to the special jurisdictional provisions of 2 U.S.C. 437h [453 U.S. 182, 187] (1976 ed. and Supp. III). The Commission subsequently moved to dismiss the appeal, and we postponed a ruling on our jurisdiction over this case pending a hearing on the merits. 449 U.S. 817 (1980). 5

II

Because the Commission vigorously contends that this Court does not have jurisdiction over this appeal, we first consider the complex judicial review provisions of the Federal Election Campaign Act. 6 The Act provides two routes by which questions involving its constitutionality may reach this Court. First, such questions may arise in the course of an enforcement proceeding brought by the Commission under 2 U.S.C. 437g (1976 ed. and Supp. III). Such actions are filed by the Commission in the federal district courts, where they are to be accorded expedited treatment. 437g (a) [453 U.S. 182, 188] (6) (A) and (10) (1976 ed., Supp. III). The judgments of the district courts in such cases are appealable to the courts of appeals, with final review in this Court available upon certiorari or certification. 437g (a) (9).

However, because Congress was concerned that its extensive amendments to the Act in 1974 might raise important constitutional questions requiring quick resolution, 7 it provided an alternative method for obtaining expedited review of constitutional challenges to the Act. This procedure, outlined in 2 U.S.C. 437h (1976 ed. and Supp. III), provides in part:

[453 U.S. 182, 189]

The statute further provides that decisions of the courts of appeals on such certified questions may be reviewed in this Court on direct appeal, 437h (b), and it directs both the courts of appeals and this Court to expedite the disposition of such cases, 437h (c).

Although Congress thus established two avenues for judicial review of constitutional questions arising under the Act, it failed to provide any mechanism for coordinating cases in which the same constitutional issues are raised by the same parties in both a 437h declaratory judgment action and a 437g enforcement proceeding. The Commission contends that this legislative oversight has allowed litigants, like appellants here, to disrupt and delay enforcement proceedings brought by the Commission under 437g by instituting separate 437h declaratory judgment actions in which the constitutional defenses to enforcement are asserted as affirmative claims. The Commission further argues that 437h declaratory judgment actions may seriously undermine the functioning of the federal courts because of the special treatment that these courts are required to accord such cases. To alleviate these potential problems, the Commission urges this Court to construe the overlapping judicial review provisions of the Act narrowly so as to preclude the use of 437h actions to litigate constitutional challenges to the Act that have been or might be raised as defenses to ongoing or contemplated Commission enforcement proceedings. 8 Under this proposed reading of 437g and 437h, the District Court in [453 U.S. 182, 190] this case should have declined to certify appellants’ constitutional claims to the Court of Appeals in light of the Commission’s pending enforcement action against CMA and CALPAC. On this basis, we are urged by the Commission to dismiss the appeal in this case for want of jurisdiction.

Although we agree with the Commission that the judicial review provisions of the Act are scarcely a blueprint for efficient litigation, we decline to construe 437h in the manner suggested by the Commission. 9 There is no suggestion in the language or legislative history of 437h indicating that Congress intended to limit the use of this provision to situations in which no 437g enforcement proceedings are contemplated or underway. 10 Section 437h expressly requires a district court to “immediately . . . certify all questions of the constitutionality of this Act” to the court of appeals. (Emphasis supplied.) We do not believe that Congress would have used such all-encompassing language had it intended to restrict 437h in the manner proposed by the Commission. 11 Indeed, the cramped construction of the [453 U.S. 182, 191] statute proposed by the Commission would directly undermine the very purpose of Congress in enacting 437h. It is undisputed that this provision was included in the 1974 Amendments to the Act to provide a mechanism for the rapid resolution of constitutional challenges to the Act. These questions may arise regardless of whether a Commission enforcement proceeding is contemplated. Yet under the Commission’s approach, even the most fundamental and meritorious constitutional challenge to the Act could not be reviewed pursuant to 437h, but instead could be considered only pursuant to the more limited procedure set forth in 437g, 12 if this question also happened to be raised in a Commission enforcement action. If Congress had intended to remove a whole category of constitutional challenges from the purview of 437h, thereby significantly limiting the usefulness of that provision, it surely would have made such a limitation explicit.

In addition, the language of 437g itself undercuts the Commission’s contention that 437h actions must be held in abeyance if the same parties are or may be involved in 437g enforcement actions brought by the Commission. The statute expressly provides that 437g enforcement actions [453 U.S. 182, 192] filed by the Commission in the district court are to be “put ahead of all other actions (other than other actions brought under this subsection or under section 437h of this title).” 437g (a) (10) (emphasis added). If Congress had intended to coordinate 437g and 437h in the manner now proposed by the Commission, it is inconceivable that it would have chosen the above language. Instead, the wording of the statute plainly implies that actions brought under both sections may proceed in the district court at the same time. See Bread Political Action Committee v. Federal Election Comm’n, 591 F.2d 29, 33 (CA7 1979), appeal pending, No. 80-1481. In sum, although Congress might have been wiser to orchestrate 437g and 437h in the manner proposed by the Commission, the statutory language and history belie any such intention. 13 We therefore conclude that we have jurisdiction over the appeal. 14 [453 U.S. 182, 193]

III

Appellants’ First Amendment claim is based largely on this Court’s decision in Buckley v. Valeo, 424 U.S. 1 (1976) (per [453 U.S. 182, 194] curiam). That case involved a broad challenge to the constitutionality of the 1974 Amendments to the Federal Election Campaign Act. We held, inter alia, that the limitations placed by the Act on campaign expenditures violated the First Amendment in that they directly restrained the rights of citizens, candidates, and associations to engage in protected political speech. Id., at 39-59. Nonetheless, we upheld the various ceilings the Act placed on the contributions individuals and multicandidate political committees could make to candidates and their political committees, and the maximum aggregate amount any individual could contribute in any calendar year. 15 We reasoned that such contribution [453 U.S. 182, 195] restrictions did not directly infringe on the ability of contributors to express their own political views, and that such limitations served the important governmental interests in preventing the corruption or appearance of corruption of the political process that might result if such contributions were not restrained. Id., at 23-38.

Although the $5,000 annual limit imposed by 441a (a) (1) (C) on the amount that individuals and unincorporated associations may contribute to political committees is, strictly speaking, a contribution limitation, appellants seek to bring their challenge to this provision within the reasoning of Buckley. First, they contend that 441a (a) (1) (C) is akin to an unconstitutional expenditure limitation because it restricts the ability of CMA to engage in political speech through a political committee, CALPAC. Appellants further contend that even if the challenged provision is viewed as a contribution limitation, it is qualitatively different from the contribution restrictions we upheld in Buckley. Specifically, appellants assert that because the contributions here flow to a political committee, rather than to a candidate, the danger of actual or apparent corruption of the political process recognized by this Court in Buckley as a sufficient justification for contribution restrictions is not present in this case.

While these contentions have some surface appeal, they are in the end unpersuasive. The type of expenditures that this Court in Buckley considered constitutionally protected were those made independently by a candidate, individual, or group in order to engage directly in political speech. Id., at 44-48. Nothing in 441a (a) (1) (C) limits the amount CMA or any of its members may independently expend in order to advocate political views; rather, the statute restrains only the amount that CMA may contribute to CALPAC. Appellants nonetheless insist that CMA’s contributions to CALPAC should receive the same constitutional protection as independent expenditures because, according to appellants, [453 U.S. 182, 196] this is the manner in which CMA has chosen to engage in political speech.

We would naturally be hesitant to conclude that CMA’s determination to fund CALPAC rather than to engage directly in political advocacy is entirely unprotected by the First Amendment. 16 Nonetheless, the “speech by proxy” that CMA seeks to achieve through its contributions to CALPAC is not the sort of political advocacy that this Court in Buckley found entitled to full First Amendment protection. CALPAC, as a multicandidate political committee, receives contributions from more than 50 persons during a calendar year. 2 U.S.C. 441a (a) (4). Thus, appellants’ claim that CALPAC is merely the mouthpiece of CMA is untenable. CALPAC instead is a separate legal entity that receives funds from multiple sources and that engages in independent political advocacy. Of course, CMA would probably not contribute to CALPAC unless it agreed with the views espoused by CALPAC, but this sympathy of interests alone does not convert CALPAC’s speech into that of CMA. [453 U.S. 182, 197]

Our decision in Buckley precludes any argument to the contrary. In that case, the limitations on the amount individuals could contribute to candidates and campaign organizations were challenged on the ground that they limited the ability of the contributor to express his political views, albeit through the speech of another. The Court, in dismissing the claim, noted:

“While contributions may result in political expression if spent by a candidate or an association to present views to the voters, the transformation of contributions into political debate involves speech by someone other than the contributor.” 424 U.S., at 21 (emphasis added).

This analysis controls the instant case. If the First Amendment rights of a contributor are not infringed by limitations on the amount he may contribute to a campaign organization which advocates the views and candidacy of a particular candidate, the rights of a contributor are similarly not impaired by limits on the amount he may give to a multicandidate political committee, such as CALPAC, which advocates the views and candidacies of a number of candidates. 17

We also disagree with appellants’ claim that the contribution restriction challenged here does not further the governmental interest in preventing the actual or apparent corruption of the political process. Congress enacted 441a (a) (1) (C) in part to prevent circumvention of the very limitations [453 U.S. 182, 198] on contributions that this Court upheld in Buckley. 18 Under the Act, individuals and unincorporated associations such as CMA may not contribute more than $1,000 to any single candidate in any calendar year. 2 U.S.C. 441a (a) (1) (A). Moreover, individuals may not make more than $25,000 in aggregate annual political contributions. 2 U.S.C. 441a (a) (3). If appellants’ position – that Congress cannot prohibit individuals and unincorporated associations from making unlimited contributions to multicandidate political committees – is accepted, then both these contribution limitations could be easily evaded. Since multicandidate political committees may contribute up to $5,000 per year to any candidate, 2 U.S.C. 441a (a) (2) (A), an individual or association seeking to evade the $1,000 limit on contributions to candidates could do so by channelling funds through a multicandidate political committee. Similarly, individuals could evade the $25,000 limit on aggregate annual contributions to candidates if they were allowed to give unlimited sums to multicandidate political committees, since such committees are not limited in the aggregate amount they may contribute in any year. 19 These concerns prompted [453 U.S. 182, 199] Congress to enact 441a (a) (1) (C), and it is clear that this provision is an appropriate means by which Congress could seek to protect the integrity of the contribution restrictions upheld by this Court in Buckley. 20 [453 U.S. 182, 200]

IV

Appellants also challenge the restrictions on contributions to political committees on the ground that they violate the equal protection component of the Fifth Amendment. Under the statute, corporations and labor unions may pay for the establishment, administration, and solicitation expenses of a “separate segregated fund to be utilized for political purposes.” 2 U.S.C. 441b (b) (2) (C). Contributions by these groups to such funds are not limited by the statute. 2 U.S.C. 431 (8) (B) (vi) (1976 ed., Supp. III). Appellants assert that a corporation’s or a union’s contribution to its segregated political fund is directly analogous to an unincorporated association’s contributions to a multicandidate political committee. Thus, they conclude that because contributions are unlimited in the former situation, they cannot be limited in the latter without violating equal protection.

We have already concluded that 441a (a) (1) (C) does not offend the First Amendment. In order to conclude that it nonetheless violates the equal protection component of the Fifth Amendment, we would have to find that because of this provision the Act burdens the First Amendment rights of persons subject to 441a (a) (1) (C) to a greater extent than it burdens the same rights of corporations and unions, and that such differential treatment is not justified. We need not consider this second question – whether the discrimination alleged by appellants is justified – because we find no such discrimination. Appellants’ claim of unfair treatment ignores the plain fact that the statute as a whole imposes far fewer restrictions on individuals and unincorporated associations than it does on corporations and unions. Persons subject to the restrictions of 441a (a) (1) (C) may make unlimited expenditures on political speech; corporations [453 U.S. 182, 201] and unions, however, may make only the limited contributions authorized by 441b (b) (2). Furthermore, individuals and unincorporated associations may contribute to candidates, to candidates’ committees, to national party committees, and to all other political committees while corporations and unions are absolutely barred from making any such contributions. In addition, multicandidate political committees are generally unrestricted in the manner and scope of their solicitations; the segregated funds that unions and corporations may establish pursuant to 441b (b) (2) (C) are carefully limited in this regard. 441b (b) (3), 441b (b) (4). The differing restrictions placed on individuals and unincorporated associations, on the one hand, and on unions and corporations, on the other, reflect a judgment by Congress that these entities have differing structures and purposes, and that they therefore may require different forms of regulation in order to protect the integrity of the electoral process. Appellants do not challenge any of the restrictions on the corporate and union political activity, yet these restrictions entirely undermine appellants’ claim that because of 441a (a) (1) (C), the Act discriminates against individuals and unincorporated associations in the exercise of their First Amendment rights. Cf. Buckley, 424 U.S., at 95 -99.

Accordingly, we conclude that the $5,000 limitation on the amount that persons may contribute to multicandidate political committees violates neither the First nor the Fifth Amendment. The judgment of the Court of Appeals is therefore affirmed.

No. 79-1952

Argued: January 19, 1981Decided: June 26, 1981

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