PAUL A. CROTTY, District Judge.
Appellants seek declaratory and injunctive relief, alleging that recently-enacted amendments to the New York City Administrative Code, commonly known as the "pay-to-play" rules, violate the First Amendment to the U.S. Constitution by unduly burdening protected political speech and association, the Fourteenth Amendment by denying equal protection of the laws, and the Voting Rights Act, 42 U.S.C. § 1973.
In 1988, after a recent wave of local scandals, the New York City Council passed the Campaign Finance Act ("CFA"), establishing the Campaign Finance Program ("Program"). (A-819.) The Campaign Finance Board ("Board") administers the Program and provides public matching funds to candidates running for the three citywide offices of Mayor, Comptroller, Public Advocate; the five offices of Borough President; and the fifty-two offices of the City Council. The CFA imposes certain obligations on all candidates, including the filing of financial disclosure statements reporting contributions and expenditures, limitations on the amount of contributions from any single donor, and the obligation to respond to the Board's requests to verify compliance with the Program. N.Y.C. Admin. Code § 3-701, et seq. The CFA also limits per-person contributions for all covered elections in a single calendar year to $4,950 for Mayor, Comptroller, or Public Advocate; $3,850 for Borough President; and $2,750 for City Council.
Additionally, candidates who seek to participate in the public financing system must agree to limitations on the total amount of money the campaign spends promoting the candidate's nomination or election. A participating candidate's campaign receives public matching funds for all eligible individual private contributions from New York City residents of up to $175 at a rate of six dollars in public funds for every one dollar in private contributions.
In 1998, the New York City Charter Revisions Commission ("Commission") sought to resolve problems that the existing law did not address. (A-314-A-316.) It proposed, and the City's voters passed by referendum, a Charter amendment that directed the Board to prohibit corporate contributions for all participating candidates; required these candidates to disclose contributions from individuals and organizations doing business with the City; and directed the Board to promulgate rules fleshing out these "doing business" limitations. N.Y.C. Charter § 1052(11)(a), (12)(a). In its recommendation, the Commission identified concerns about contractor and lobbyist contributions, but noted the lack of evidence that such contributions had actually influenced the award of a particular contract or passage of a bill. Report of the New York City Charter Revision Commission 12-13 (Aug. 20, 1998) ("1998 Commission Report"). Nevertheless, the Commission concluded that there was "no doubt that these contributions have a negative impact on the public because they promote the perception that one must `pay-to-play.'"
In 2006, after several public hearings and studies, the Board reported that over twenty percent of the contributions in the 2001 and 2005 election cycles were from individuals and entities doing business with the City, who comprised only five percent of contributors, and that large contributions were more likely than small contributions to come from such donors. N.Y.C. Campaign Fin. Bd., Interim Report on "Doing Business" Contributions 12, 13 (June 19, 2006) ("Interim Report"). In addition, incumbents—considered to have greater influence on city decisions—were more likely to receive these large donations than challengers. N.Y.C. Campaign Fin. Bd., Public Dollars for the Public Good: A Report on the 2005 Elections 122 (2006) ("2005 Election Report"). In order to improve the CFA, the Board recommended banning all organizational contributions (including partnerships, LLCs, PACs, and unions) and regulating contributions by individuals and entities doing business with the City. 2005 Election Report, 120, 122.
That year, the City passed Local Laws 15 and 17, which created a mandatory electronic filing system for lobbyists; required full lobbyist disclosure of all fundraising and consulting activities; banned all gifts from lobbyists to City Officials; and excluded contributions from lobbyists and the individuals identified on their statements of registration from the definition of "matchable contribution." N.Y.C. Admin. Code §§ 3-213, 3-216.1, 3-225, 3-702(3)(g). This latter category of exclusions includes the lobbyist's spouse or domestic partner and, if the lobbyist is an organization, any officer or employee who engages in lobbying activity, as well as his or her spouse or domestic partner.
In 2007, the City Council voted 44-4 to pass Local Law 34, requiring disclosure of, and restricting contributions from, individuals and entities who have business dealings with the City, as defined in the CFA. The law lowers these donors' contribution limits approximately twelve-fold, to $400 (from the generally-applicable level of $4,950) for the three City-wide offices; to $320 (from $3,850) for Borough offices; and to $250 (from $2,750) for City Council.
(N.Y.C. Council, Comm. on Gov'tal Affairs, Report of the Governmental Affairs Division, for Int. No. 586-2007 24-25 (June 12, 2007) ("Committee Report").) The Committee Report explained that the expansion of the corporate contribution ban addressed a "loophole" that allowed similarly structured business entities to circumvent the contribution limits.
The "doing business" limits apply to contributions from any natural person who is a chief executive officer, chief financial officer, and/or chief operating officer; serves in a senior managerial or equivalent capacity; or has an interest exceeding ten percent in an entity that has "business dealings" with the City or affiliate agency, unless that person is the candidate or a relative. N.Y.C. Admin. Code § 3-703(1-a). "Business dealings" include: (1) contracts greater than or equal to $100,000 for the procurement of goods, services, or construction; (2) real property acquisitions or dispositions; (3) applications for approval of transactions involving office space, land use, or zoning changes; (4) certain concessions and franchises greater than or equal to $100,000; (5) grants greater than or equal to $100,000; (6) economic development agreements; (7) contracts for investment of pension funds; and (8) transactions with lobbyists.
Section 3-702 of the Administrative Code contains two definitions of "lobbyist": The first is narrow, referencing § 3-211's definition of "every person or organization retained, employed or designated by any client to engage in lobbying." The second is broader, encompassing anyone included in § 3-211, as well as the lobbyist's spouse or domestic partner; unemancipated children; and, for entities, the organization's officers and employees who engage in lobbying or work for a division of the organization that engages in lobbying activities and their family members.
As of June 30, 2008, New York City agencies (excluding affiliated entities) held 19,578 open contracts worth approximately $55.4 billion. (Simpson Decl. ¶ 5). A wide range of for-profit and non-profit entities qualify as having business dealings with the City, including Con Edison, Waste Management of New York LLC, the New York City Ballet, the Legal Aid Society, the Brooklyn Botanic Garden Corporation, various health and social services providers, day care centers, religious organizations, and labor organizations.
Appellants filed an original and amended complaint in February 2008 and, in April 2008, moved for a preliminary injunction on some of the claims asserted, raising facial challenges to these three provisions. After the district court postponed the hearing on injunctive relief until the trial on the merits, the Appellees moved for summary judgment. The parties then stipulated that there was no need for an evidentiary proceeding in connection with the motions. Several
By Order dated February 6, 2009, the district court denied Appellants' motion for injunctive relief and granted Appellee's motion for summary judgment on the same grounds: that the challenged limits served a sufficiently important governmental interest—addressing the reasonable concern about actual and apparent corruption by those doing business with the City. While there was no recent evidence of actual corruption with respect to campaign contributions, the district court reasoned, given the public's perception of continuing corruption, fueled by actual pay-to-play scandals in the 1980s, the City properly imposed the challenged limits to combat corruption, correct misperceptions, and instill public confidence in the City's political and governmental processes. 599 F. Supp. 2d at 445-46. The court also found that the contribution limits were closely drawn to respond to this interest in eliminating actual and apparent corruption, rejecting Appellants' arguments concerning the failure to index for inflation and viewpoint discrimination.
The district court subjected the non-matching provisions to the same analysis and concluded that they were permissible.
Finally, the district court upheld the ban on contributions from partnerships, LLCs, and LLPs for the same reasons that justify prohibiting corporate contributions, specifically, to prevent circumvention of the valid contribution limits and the use of business forms to deploy for political ends business assets amassed for business reasons. (
A circuit court reviews a district court's grant of summary judgment
The party requesting permanent injunctive relief must demonstrate (1) irreparable harm (here, a constitutional violation) and (2) likelihood of actual success on the merits.
The Government bears the burden of justifying its contribution limits in light of a facial challenge.
The judiciary owes special deference to legislative determinations regarding campaign contribution restrictions.
In certain cases, however, contribution restrictions may severely impact political dialogue, for example by preventing "candidates and political committees from amassing the resources necessary for effective advocacy."
The Supreme Court has consistently held that the prevention of actual and perceived corruption qualifies as a sufficiently important state interest.
This Court must consider three important decisions that have issued subsequent to the district court's opinion:
In
Since the Supreme Court preserved the distinction between expenditures and contributions, there is no basis for Appellants' attempt to broaden
After handing down
The Supreme Court determined that the provision posed a "markedly more significant burden" than the Millionaire's Amendment struck down in
In addition, this Court recently struck down the State of Connecticut's ban on lobbyist contributions.
Appellants urge us to expand
The doing business limitations have three characteristics that place them outside the scope of
Although
While independent corporate campaign expenditures may influence a candidate, or facilitate access that non-speakers may not enjoy,
Furthermore, such donations certainly feed the public perception of
Indeed, the Supreme Court recently attributed the particular threat of corruption posed by campaign contributions to the risk of mixing money and politics.
Appellants argue that
Indeed, as the district court reasoned,
Appellants do not dispute that the generally applicable contribution limits responded to actual pay-to-play scandals in New York City in the 1980's. (Appellant Br. 4-5.) Rather, they argue that these initial limits have been successful, so that lower limits are unnecessary. This determination, however, is a matter of policy better suited for the legislature, which has institutional expertise in the field of election regulation and effectively curbed these scandals in the first place.
In addition, it is clear that the City Council properly studied this issue before concluding that doing business contributions are particularly problematic and merit special treatment. The record contains several reports and investigations—including the 1998 Commission Report, the 2005 Election Report, the 2006 interim report of a study conducted by students at New York University's Wagner Graduate School of Public Service, and the Committee on Governmental Operations' Reports on the challenged laws—all of which attest to the significant role that "doing business" contributions play in elections and in the public perception of corruption. For example, "doing business" contributors were more likely to give large rather than small donations, and disproportionately contributed to incumbents-who are considered to have greater influence on city decisions—than to challengers. 2005 Election Report, 122;
Moreover, there is direct evidence of a public perception of corruption.
Appellants assert several rationales for why these provisions are not closely drawn. First, they assert that they are overbroad because they ban legitimate as well as corrupt acts.
Appellants also argue that these restrictions are underinclusive because they do not apply to all contributors with the influence and incentive to engage in pay-to-play, specifically labor organizations and neighborhood associations that do not have procurement contracts which qualify as business dealings (
Appellants additionally contend that these provisions are overinclusive because they may be applied using the broader definition of "lobbyist." Appellees concede, however, that the narrower definition applies. (Appellee's Br. 11 n.5). This narrower definition comports with, and is no broader than necessary to address, the interest in eliminating actual and perceived corruption. Appellants acknowledge that the public perceives lobbyists as influencing or attempting to influence elected officials through their campaign contributions. (
Appellants further assert that these provisions are poorly tailored because they are not indexed for inflation and discriminate based on viewpoint. The mere failure to index for inflation, however, does not compel a finding that the provisions are not closely drawn.
Viewpoint discrimination is a subset of content discrimination in which the government impermissibly targets, not the subject matter itself, but rather particular views taken on the subject.
Sections 3-702(3) and 3-703(1-a) exclude contributions from individuals subject to the lower doing business limits, including lobbyists, as well as contributions from any other person required to be included in a lobbyists' statement of registration from the matching provisions of the public financing scheme. Non-matching does not prevent someone from making a contribution, but it does minimize the value of that contribution. In this respect, it is similar to a limit and subject to the less stringent standard of review. For the reasons discussed, the non-matching provision is closely drawn to address a sufficiently important governmental interest.
The public financing scheme generously matches eligible contributions of up to $175 using tax dollars at the rate of 6 to 1. The program encourages small, individual contributions, and is consistent with
The matching provision at issue here is clearly distinguishable. First, it applies to contribution limits, which the Supreme Court has recognized to be less onerous restrictions on speech than campaign expenditure limits. Second, while the matching provisions here may burden the candidates who choose to participate in the public financing scheme, the provision in
Additionally, the use of the broader definition of lobbyist for non-matching purposes does not render it overinclusive. Insofar as the provision reaches some contributors peripheral to the business dealings, such as a lobbyist's secretary or spouse, it does so only to prevent circumvention and does not form "a substantial portion of the burden on speech."
The Supreme Court has held that "the degree of scrutiny turns on the nature of the activity regulated," not on the fact that contributions are outright banned, as opposed to just limited.
The anti-corruption rationale presents a sufficiently important governmental interest for the reasons already discussed, and applies equally to LLCs, LLPs, and partnerships, as to corporations. In addition, the organizational form of an LLC, LLP, and partnership, like a corporation, creates the opportunity for an individual donor to circumvent valid contribution limits.
The record contains sufficient evidence from which one could infer circumvention and perceive corruption. For example, these entities have become more active contributors since the corporate ban; LLC contributions more than doubled from 2.8% in the 2001 election to 6.2% in the 2005 election.
Entity contributions also undermine the CFA's goal of transparency, because they only have to be attributed to the partner or owner when they exceed $2,500. Committee Report, 29. Transparency is a particular problem for LLCs because many are involved in city business, especially land use, yet there are minimal disclosure requirements and often no publicly available information about the owners.
The pressing question here is whether the entity ban is closely drawn.
For the reasons that justify the corporate contribution prohibition, therefore, the legislature permissibly determined that there is no room in City campaigns for entity contributions. While limits may minimize circumvention and the appearance of corruption, the City is free to decide that these evils must be eliminated to ensure the public's faith in the electorate system.
For the foregoing reasons, we AFFIRM the judgment of the district court upholding the constitutionality of the contribution limits, non-matching provision, and entity ban.
CALABRESI, J., concurring:
As Jesus looked up, he saw the rich putting their gifts into the temple treasury. He also saw a poor widow put in two very small copper coins. "Truly I tell you," he said, "this poor widow has put in more than all the others. All these people gave their gifts out of their wealth; but she out of her poverty put in all she had to live on."
Luke 21:1-4.
I join the majority opinion because it properly describes and follows the current law of campaign finance. But all is not well with this law, and I believe it appropriate to state in a judicial opinion why I think this is so.
Judge Crotty has performed a careful analysis of corruption (actual and its appearance), and only of corruption, as a ground for upholding the regulations at issue in this case.
I agree completely with the Supreme Court that the First Amendment protects each person's right to express political beliefs through money. Where I disagree with the Court is in its repeated insistence that any recognition of the "level playing field" interest (elsewhere referred to as the "antidistortion interest," Citizens United v. FEC, 130 S.Ct. 876, 903 (2010)) is inconsistent with this right. To the contrary, the antidistortion interest promotes this right in two important ways. First, it prevents some speakers from drowning out the speech of others. And second, it safeguards something of fundamental First Amendment importance—the ability to have one's protected expression indicate the intensity of one's political beliefs. These values, moreover, have not gone unrecognized in underlying First Amendment jurisprudence.
The first benefit of antidistortion measures is not difficult to see. If an external factor, such as wealth, allows some individuals to communicate their political views too powerfully, then persons who lack wealth may, for all intents and purposes, be excluded from the democratic dialogue. In much the same way that anti-noise ordinances help to prevent megaphone users from drowning out all others in the public square, contribution limits can serve to prevent the wealthiest donors from rendering all other donors irrelevant—from, in effect, silencing them. For an articulation of this concern—i.e., that, without regulation, the rich would be able to use their wealth to overwhelm the voices of the poor—one need look no further than the Supreme Court's decision in Red Lion Broadcasting Co. v. FCC, where, in upholding the FCC's "fairness doctrine," the High Court long ago explained that, without the rule in place, "station owners and a few networks would have unfettered power to make time available only to the highest bidders" and thereby broadcast only those bidders' political views. Red Lion Broadcasting Co. v. FCC, 395 U.S. 367, 392 (1969); see also id. at 387 ("Just as the Government may limit the use of sound-amplifying equipment potentially so noisy that it drowns out civilized private speech, so may the Government limit the use of broadcast equipment. The right of free speech of a broadcaster, the user of a sound truck, or any other individual does not embrace a right to snuff out the free speech of others.").
The second benefit of antidistortion measures is perhaps more subtle, but of no less importance: it relates to the ability of all persons, rich and poor, to express the intensity of their feelings. In many circumstances, the intensity of a speaker's expression tells us much about the intensity of that speaker's beliefs. Polite applause conveys less enthusiasm than a shouted "Bravo!" Passing criticisms convey weaker disagreement than passionate harangues. And, of course, the tone of a judicial opinion provides some indication of how bleakly a judge views a certain area of the law. But where speech takes the form of a monetary expenditure, the link between intensity of beliefs and intensity of expression, as measured by the amount contributed, can too easily break down. This is a result of the unequal distribution of wealth, which makes the amount of money an individual spends on behalf of a political cause an unreliable measure of the intensity and depth of that individual's support for the cause. "In other words, and crucially, a large contribution by a person of great means may influence an election enormously, and yet may represent a far lesser intensity of desire than a pittance given by a poor person." Landell v. Sorrell, 406 F.3d 159, 161 (2d Cir. 2005) (Calabresi, J., concurring in the denial of rehearing en banc), rev'd sub nom. Randall v. Sorrell, 548 U.S. 230 (2006).
To return to the example of the megaphone in the public square, the problem with its loudness is not just that it drowns out the voices of others, but also that it misrepresents, to an outside observer, the relative intensity of the speaker's views. That is, even if the megaphone user cares little about the issue being discussed, his voice gets heard above all others, while the voices (and intensity of feelings) of those who care passionately about the issue (and shout their beliefs at the top of their lungs) seem small in comparison. The one speaker's relative loudness— along with the other speakers' relative softness—obscures the depth of each speaker's views, thereby degrading the communicative value of everyone's message.
The foregoing example may seem fanciful, but money is not. And there is perhaps no greater a distortive influence on the intensity of expression than wealth differences. The wider the economic disparities in a democratic society, the more difficult it becomes to convey, with financial donations, the intensity of one's political beliefs. People who care a little will, if they are rich, still give a lot. People who care a lot must, if they are poor, give only a little. Jesus's comment about the rich donors and the poor widow says it all. Today, the amount of an individual's campaign contribution reflects the strength of that individual's preferences far less than it does the size of his wallet. In this sense, all political donations—by rich and poor alike— lose a crucially important aspect of their communicative value when campaign funds are unrestricted. And that is a problem of profound First Amendment significance.
It is no small irony, then, that in refusing to recognize the existence of a state interest in "leveling the playing field"—an interest which prior Supreme Court precedents had suggested was compelling, and certainly is at least legitimate—the Court purports to safeguard "the `unfettered interchange of ideas.'" Bennett, 131 S. Ct. at 2826 (quoting Buckley v. Valeo, 424 U.S. 1, 14 (1976) (per curiam)). Far from standing in the way of this ideal, the antidistortion interest is vital to its fulfillment. Left unregulated, the "distorting effects of immense aggregations of wealth," Austin v. Michigan Chamber of Commerce, 494 U.S. 652 (1990), overruled by Citizens United, 130 S. Ct. at 913, will garble the political debate, trumpeting voices that would otherwise be muted and muting voices that would otherwise be trumpeted. Profound wealth differences, in short, make it difficult for speakers to express (and listeners to discern) the true depths of their feelings. And because wealth inequalities are inevitable, and indeed, many would say are desirable in their creation of incentives, the only way to ensure a truly "unfettered interchange of ideas"—an interchange, that is, where each voice is heard in reasonable proportion to the intensity of the beliefs it expresses—is to give the government some freedom to mitigate the fettering impact of these inequalities.
Indeed, if the Court were correct that the level playing field interest does not provide an appropriate reason for regulating campaign contributions, then it becomes difficult to see why the First Amendment does not give individuals the right to pay other individuals to vote for candidates in elections. Such a practice need not raise the specter of quid pro quo corruption; one might still buy votes on behalf of one's preferred candidate even if one could ask nothing from the candidate in return. The critical problem with vote-buying is not corruption; it is rather that allowing the practice would give the wealthiest individuals a huge effect over political elections, making even their relatively minor preferences matter immensely and the possibly intense preferences of the poor matter not much at all. This same concern, of course, explains why a state has a valid interest in leveling the playing field with respect to campaign contributions. Yet, curiously, the Supreme Court seems to accept the validity of vote-buying regulations without hesitation, cf. Brown v. Hartlage, 456 U.S. 45, 54-55 (1982), while it refuses to accept the validity of the antidistortion interest.
I am not suggesting that expressing the intensity of one's views is the only thing that matters in campaign finance doctrine, or in election law more generally.
What is at stake here—what everyone knows is at stake here—is what was recognized and expressed so directly, succinctly, and powerfully in the story of the widow's mite. The ability to express one's feelings with all the intensity that one has—and to be heard—is a central element of the right to speak freely. It is, I believe, something that is so fundamental that sooner or later it is going to be recognized. Whether this will happen through a constitutional amendment or through changes in Supreme Court doctrine, I do not know. But it will happen. Rejection of it is as flawed as was the rejection of the concept of one-person-one-vote. And just as constitutional law eventually came to embrace that concept, so too will it come to accept the importance of the antidistortion interest in the law of campaign finance.
It is with that faith in a better future, along with an understanding of the requirements of our flawed present, that I join the majority opinion.
DEBRA ANN LIVINGSTON, Circuit Judge, concurring in part and concurring in the judgment:
Since the enactment of its Campaign Finance Act ("CFA") in 1988, New York City has imposed limits on the amount of money that may be contributed to a single candidate for public office in a given calendar year.
"Doing business" contributors include, inter alia, individuals with specified ownership or management roles in entities with valuable City contracts or grants, or relations with the City that concern the acquisition or disposition of real property.
The City also operates a public campaign financing program in which candidates for the various City offices specified above may choose to participate. In this program, the City matches the campaign contributions of most individuals to candidates who participate in the public funding program at a rate of six to one (with up to $1,050 of public funds available for matching per contributor per candidate). Id. § 3-705(2)(a); Loprest Decl. ¶ 11. Contributions from lobbyists or other persons "doing business" with the City, however, are not eligible for matching.
I agree with the majority that the "doing business" contribution limitations in this case are subject to scrutiny for whether "they are closely drawn to serve a sufficiently important interest." Davis v. FEC, 554 U.S. 724, 737 (2008) (internal quotation marks omitted); see Maj. Op. at 21. The Supreme Court has repeatedly indicated that, while expenditure limitations are subject to strict scrutiny, which requires courts to assess whether the challenged "restriction `furthers a compelling interest and is narrowly tailored to achieve that interest,'" Citizens United v. FEC, 130 S.Ct. 876, 898 (2010) (quoting FEC v. Wis. Right to Life, Inc., 551 U.S. 449, 464 (2007) (opinion of Roberts, C.J.)), contribution limits are subject to less searching scrutiny because campaign contributions "lie closer to the edges than to the core of political expression." FEC v. Beaumont, 539 U.S. 146, 161 (2003); see also Nixon v. Shrink Mo. Gov't PAC, 528 U.S. 377, 387-88 or her spouse or domestic partner and unemancipated children, are excluded from the matching program. Id. (2000); Buckley v. Valeo, 424 U.S. 1, 25 (1976) (per curiam). At the same time, with regard to contribution no less than expenditure limits, the First Amendment "has its fullest and most urgent application precisely to the conduct of campaigns for political office." Buckley, 424 U.S. at 15 (quoting Monitor Patriot Co. v. Roy, 401 U.S. 265, 272 (1971)) (internal quotation mark omitted). The scrutiny required by the First Amendment is thus both "exacting," see id. at 16; Shrink Mo., 528 U.S. at 386, and "rigorous," Buckley, 424 U.S. at 29.
I likewise agree that the non-matching provisions here are similarly subject to "closely drawn" analysis. See Maj. Op. at 38. At least in the circumstances in this case, matching funds given to a candidate as a result of a contribution from a private donor are the functional equivalent of a contribution, so that limits on such funds are functionally equivalent to contribution limits. See FEC v. Colo. Republican Fed. Campaign Comm., 533 U.S. 431, 456 (2001) (determining that "party coordinated spending [is] the functional equivalent of contributions," id. at 447, and accordingly applying "scrutiny appropriate for a contribution limit," id. at 456). Therefore, this Court must analyze both sets of provisions to determine whether "they are closely drawn to serve a sufficiently important interest." Davis, 554 U.S. at 737 (internal quotation marks omitted). The City bears the burden of proof in this inquiry. Shrink Mo., 528 U.S. at 387-88.
I part ways with the majority, not in our shared conclusion as to the constitutionality of the provisions here, but in determining what counts as a "sufficiently important interest" in relation to which the provisions must be judged. Pursuant to the Supreme Court's decision in Buckley, preventing "the actuality and appearance of corruption" is such an interest. Buckley, 424 U.S. at 26. The majority, however, goes beyond Buckley in concluding that "improper or undue influence . . . qualifies as a form of corruption" which may be combated via closely drawn contribution limits. Maj. Op. at 22-23 (emphases omitted). Because recent decisions by the Supreme Court and this Court clearly foreclose this latter determination, I respectfully disagree with it.
In Citizens United, the Supreme Court unequivocally stated that when Buckley identified the prevention of corruption or its appearance as "a sufficiently important governmental interest" to render closely drawn contribution limits acceptable under the First Amendment, "that interest was limited to quid pro quo corruption." 130 S. Ct. at 909 (emphasis added).
Even if it were not clear after Citizens United (as, in fact, it is) that First Amendment freedoms may not be curtailed to address mere influence or the perception of such influence in the political arena, any question about whether Citizens United's pronouncement applies in the context of contribution limits was resolved by this Court in Green Party of Connecticut v. Garfield, 616 F.3d 189 (2d Cir. 2010). There, the Court addressed the validity of Connecticut's bans on campaign contributions to candidates for state office from state contractors and lobbyists. See id. at 194. Some of the evidence before the Green Party panel "suggest[ed] that many members of the public generally distrust lobbyists and the `special attention' they are believed to receive from elected officials." Id. at 206. This Court said there that "influence and access," without more, "are not sinister in nature," but are part of representative government. 616 F.3d at 207. Citing Citizens United, the Court held that "evidence demonstrating that lobbyist contributions give rise to an appearance of `influence' has no bearing on whether the . . . ban on lobbyist contributions is closely drawn to the state's anticorruption interest." Id. at 207 (citation omitted).
The majority distinguishes between "mere influence or access to elected officials" and "improper or undue influence," suggesting that while the former may be an insufficient basis on which to limit First Amendment freedoms, the latter is not. Maj. Op. at 22-23 & n.14. To be clear, if "improper or undue influence" means nothing more than an appearance of quid pro quo corruption arising, as Buckley put it, "from public awareness of the opportunities for abuse inherent in a regime of large individual financial contributions," 424 U.S. at 27, I have no quibble with the majority's position. Citizens United, however, clearly "rejected a claimed governmental interest `in equalizing the relative ability of individuals and groups to influence the outcome of elections,' and rejected the concern over the `undue influence' of money serving as a form of corruption that justifies regulation." Samuel Issacharoff, On Political Corruption, 124 Harv. L. Rev. 118, 125-26 (2010) (quoting Citizens United, 130 S. Ct. at 904). Thus, contribution limits are acceptable only when they are closely drawn to tackle real or apparent quid pro quo corruption.
This is no unimportant point. By requiring that a regulation suppressing political speech and association be closely drawn to address the threat of quid pro quo corruption (or the perception that large contributors will secure their quid), courts strive to draw a principled constitutional line—a line that permits legislatures to address the significant danger corruption poses to representative democracy while it vigorously protects political speech by ensuring that First Amendment principles are enforced. The generic influence theory is, in contrast—and as the Citizens United Court recognized—"susceptible to no limiting principle." Citizens United, 130 S. Ct. at 910 (quoting McConnell, 540 U.S. at 296 (Kennedy, J., concurring in the judgment in part and dissenting in part)) (internal quotation mark omitted). Today it disfavors "doing business" contributors. But all those who seek to influence politicians are vulnerable to being perceived as having influence that is "undue." If demonstrating such a perception is enough to bear the legislature's First Amendment burden in justifying restrictions on speech and association, that burden is light indeed.
Focusing properly only on the prevention of quid pro quo corruption or its appearance, I next conclude that the New York City restrictions at issue are "closely drawn" to serve the interest which justifies the limitations they place on First Amendment rights. Because I find this question more difficult than my colleagues, however, I write briefly to explain my position.
The Supreme Court has not yet addressed the First Amendment implications of campaign finance laws that impose stricter contribution limits on the political contributions of some individuals who are seen to pose a particularly serious threat to the government's interest in preventing the appearance or actuality of quid pro quo corruption. Federal law has long prohibited government contractors from making contributions to "any political party, committee, or candidate for public office or to any person for any political purpose or use" while these contractors are seeking or performing pursuant to a contract. The relevant provision, however—2 U.S.C. § 441c—has not come before the Court. This Court in Green Party upheld a contribution ban imposed on Connecticut contractors and related individuals in the wake of a corruption scandal, 616 F.3d at 205, but invalidated a ban imposed on lobbyists and their families, finding insufficient evidence to demonstrate that all such contributions give rise to an appearance of corruption, id. at 206-07. Other courts have upheld laws limiting in various ways the campaign contributions of casino operators, see Casino Ass'n of La. v. State ex rel. Foster, 820 So.2d 494 (La. 2002), lobbyists, see N.C. Right to Life, Inc. v. Bartlett, 168 F.3d 705 (4th Cir. 1999), and municipal bond traders, see Blount v. SEC, 61 F.3d 938 (D.C. Cir. 1995). But the case law is relatively sparse, and no case has addressed a set of limits precisely analogous to those here.
The law at issue, to survive First Amendment scrutiny, must both serve the City's anticorruption interest and be "closely drawn" to achieve this interest. There is reason to question whether New York City's "doing business" restrictions satisfy this test. Thousands of New Yorkers are severely restricted in the amounts they may contribute or have matched as a result of these restrictions, some by virtue of no more than a family relationship or their leadership positions in institutions such as the Metropolitan Museum of Art or the Cathedral Church of St. John the Divine. See Joseph Goldstein, City Blacklist Limits Giving by 12,000, N.Y. Sun, August 14, 2008, http://www.nysun.com/new-york/city-blacklist-limits-giving-by-12000/83868. By contrast, other New Yorkers who would qualify as "doing business" with the City under any ordinary understanding of the term (such as those leading municipal labor unions) are subject only to the higher limits. Furthermore, New York's law restricts "doing business" contributions to campaigns for specified City offices regardless of whether the particular office at stake plays any role in the business relationship that is the trigger for the stricter limits.
The majority relies in part on the "objective[] reasonable[ness]" of "the connection between money and municipal action" to uphold the strict limits New York City's law places upon the free speech and associational rights of those "doing business." Maj. Op. at 31. The Supreme Court has stated, however, that "[w]hen the Government defends a regulation on speech as a means to redress past harms or prevent anticipated harms, it must do more than simply posit the existence of the disease sought to be cured. It must demonstrate that the recited harms are real, not merely conjectural." Turner Broad. Sys, Inc. v. FCC, 512 U.S. 622, 664 (1994) (plurality opinion) (citation omitted) (internal quotation marks omitted); see also Colo. Republican Fed. Campaign Comm. v. FEC, 518 U.S. 604, 618 (1996) (opinion of Breyer, J.) (applying Turner in the campaign finance context); Shrink Mo., 528 U.S. at 392 ("We have never accepted mere conjecture as adequate to carry a First Amendment burden . . . ."). Requiring the City to point to evidence demonstrating its anticorruption concern, moreover, does not amount to "giving every corruptor at least one chance to corrupt." Maj. Op. at 27. Reports of recent scandals are one form of evidence that tends to show corruption or its appearance, see, e.g., Green Party, 616 F.3d at 200, but so do other forms of evidence, including, inter alia, testimony by those familiar with the political life of the community, see Shrink Mo., 528 U.S. at 393, and surveys of the populace, see id. at 394.
On balance, however, and upon a close examination of the record, I agree with the majority's conclusion that the City has adequately demonstrated that its "doing business" contribution limits address a real and not a conjectural corruption concern. First, a report prepared for the Campaign Finance Board ("CFB") in 2006 reported that those "doing business" with the City tend to give larger contributions to candidates (albeit within the 1988 contribution limits) as compared to those lacking such business relationships. See Loprest Decl., Ex. A, Municipal Campaign Finance and "Pay-to-Play": An Analysis of Doing Business Contributions in New York City ("Pay-to-Play Report") at 12.
Granted, the record also contains troubling indications that at least some of the proponents of the "doing business" limits may have aimed at curtailing the influence of "doing business" contributors as much as corruption or its appearance. See, e.g., Pines Decl., Ex. F. Report of the New York City Charter Revision Comm'n at 19 (noting that donations by "doing business" contributors "at a minimum . . . create the perception that [such] donors have the opportunity and desire to exercise undue influence over elected officials"). The anticorruption interest pressed by the City in justification of the new contribution limits, however, is borne out in the record. And in these circumstances, the Supreme Court's precedents regarding contribution limits require the conclusion that New York City's "doing business" restrictions are closely drawn, despite the lack of a perfect fit between these restrictions and the threat of real or perceived corruption. Indeed, while the Supreme Court has never had occasion to address a campaign finance scheme involving targeted, variable limits as are at issue here, it has consistently counseled that, outside narrow circumstances, see Randall v. Sorrell, 548 U.S. 230, 248-62 (2006), deference is owed to legislative determinations regarding campaign contribution restrictions. See, e.g., McConnell, 540 U.S. at 137. Judged by this precedent, New York City's "doing business" contribution limits fall within—although perhaps barely within—the bounds of the Supreme Court's contribution limits jurisprudence.
First, those "doing business" within the meaning of the law are held to the stricter contribution limits only while doing business and for a short period thereafter—strongly suggesting that the law is aimed at the particular danger of real or apparent quid pro quo arrangements, rather than mere influence. See McConnell, 540 U.S. at 167 (noting that certain "regulations . . . are reasonably tailored, with various temporal . . . limitations designed to focus the regulations on the important anticorruption interests to be served"). The Supreme Court has said, moreover, that contribution limits, as opposed to bans, "involve[] little direct restraint on [a contributor's] political communication, for [they] permit[] the symbolic expression of support evidenced by a contribution" and do not otherwise "infringe the contributor's freedom to discuss candidates and issues." Buckley, 424 U.S. at 21.
Despite some disagreement with the majority in terms of the analysis here, I share much common ground with the majority opinion. I agree that the ban on contributions by LLCs, LLPs, and partnerships must be upheld pursuant to FEC v. Beaumont, 539 U.S. 146, which the Supreme Court declined to overrule in Citizens United. More fundamentally, I agree that individual citizens, not their government, should determine who may speak and to whose speech others will listen. See Maj. Op. at 14-15. The Supreme Court has recognized that "[l]eveling electoral opportunities [by restricting political speech] means making and implementing judgments about which [candidates'] strengths should be permitted to contribute to the outcome of an election." Davis, 554 U.S. at 742. The First Amendment, however, "[p]remised on mistrust of governmental power . . . stands against attempts to disfavor certain subjects or viewpoints," as well as to draw distinctions among speakers. Citizens United, 130 S. Ct. at 898. This is why "the concept that government may restrict the speech of some elements of our society in order to enhance the relative voice of others is wholly foreign to the First Amendment." Buckley, 424 U.S. at 48-49. While I disagree with the majority's analysis in the respects noted here, neither the majority opinion nor this concurrence casts doubt on the paramount importance of upholding the freedom of individuals to speak as they wish about the political life of the nation or of their communities. It is in the knowledge of this fundamental agreement that I respectfully concur as to Parts I, II and III.A, and concur in the judgment as to Part III.B-E.
All of these incidents occurred in the New York State area. While none implicates an elected New York City official, the public is not as parsing as Appellants would hope. The City Council need not wait for this outbreak to infect its own members, so that the public may specifically lose faith in that legislative body, as well. Ranging from before 2006—when the first of the challenged laws passed—to the present, these scandals have created a climate of distrust that feeds the already—established public perception of corruption. Appellants argue that the City may, in defending the law, rely only on those scandals that predate it. To consider only the scandals that predate the law would lead to an absurd result in cases, unlike this one, where a history of actual corruption is required (
