Federal Election Commission v. Ted Cruz For Senate, 21-12

CourtUnited States Supreme Court
Writing for the CourtRoberts, Chief Justice
PartiesFEDERAL ELECTION COMMISSION, APPELLANT v. TED CRUZ FOR SENATE, ET AL.
Docket Number21-12
Decision Date16 May 2022

596 U. S. ____

FEDERAL ELECTION COMMISSION, APPELLANT
v.

TED CRUZ FOR SENATE, ET AL.

No. 21-12

United States Supreme Court

May 16, 2022


Argued January 19, 2022

APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA

During his 2018 Senate reelection campaign and consistent with federal law, see 11 CFR §110.10; 52 U. S. C. §30101(9)(A)(i), appellee Ted Cruz loaned $260,000 to his campaign committee, Ted Cruz for Senate (Committee). To repay these and other campaign debts, campaigns may continue to receive contributions after election day. See 11 CFR §110.1 (b) (3)(i). Section 304 of the Bipartisan Campaign Reform Act of 2002 (BCRA) restricts the use of post-election contributions by limiting the amount that a candidate may be repaid from such funds to $250,000. 52 U. S. C. §301160. Relevant here, the Federal Election Commission (FEC) has promulgated regulations establishing three rules to implement that limitation: First, a campaign may repay up to $250,000 in candidate loans using contributions made "at any time." 11 CFR §116.12(a). Second, to the extent the loans exceed $250,000, a campaign may use pre-election funds to repay the portion exceeding $250,000 only if the repayment occurs "within 20 days of the election." §116.11(c)(1). Third, when the 20-day post-election deadline expires, the campaign must treat any portion above $250,000 as a contribution to the campaign, precluding later repayment. §116.11(c)(2).

The Committee began repaying Cruz's loans after the 20-day postelection window for repaying amounts over $250,000 had closed. It accordingly repaid Cruz only $250,000, leaving $10,000 of his personal loans unpaid. Cruz and the Committee filed this action in Federal District Court, alleging that Section 304 of BCRA violates the First Amendment and raising challenges to the FEC's implementing regulation, §116.11. The District Court granted Cruz and his Committee summary judgment on their constitutional claim, holding that the loan-repayment limitation burdens political speech without sufficient

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justification, and dismissed as moot their challenges to the regulation.

Held:

1. Appellees have standing to challenge the threatened enforcement of Section 304. Pp. 3-10.

(a) The Government recognizes that the Committee's present inability to repay the final $10,000 of Cruz's loans constitutes an injury in fact both to Cruz and his Committee. It maintains, however, that appellees lack Article III standing because these injuries are not traceable to the threatened enforcement of Section 304, see Lujan v. Defenders of Wildlife, 504 U. S. 555, 560-561. First, the Government argues that appellees knowingly triggered the application of the loan-repayment limitation and thus their injuries are traceable to themselves, not the Government. This Court has never recognized an exception to Article III standing's traceability requirement for injuries that a party purposely incurs. Moreover, this Court has made clear that an injury resulting from the application or threatened application of an unlawful enactment remains fairly traceable to such application, even if the injury could be described in some sense as willingly incurred. See Evers v. Dwyer, 358 U. S. 202, 204 (per curiam). Cases cited by the Government-Clapper v. Amnesty Int'l USA, 568 U. S. 398, and Pennsylvania v. New Jersey, 426 U. S. 660 (per curiam)-do not alter that conclusion. In contrast to those cases, here the appellees' injuries are directly inflicted by the FEC's threatened enforcement of the provisions they now challenge. That appellees chose to subject themselves to those provisions does not change the fact that they are subject to them, and will face genuine legal penalties if they do not comply. Finally, the Government's observation that it should not be blamed for appellees' injuries because the Committee had a legally available alternative-i.e., repaying Cruz's loans in full with pre-election funds, within 20 days of the election-misses the point. Demanding that the Committee do so would require it to forgo the exercise of the First Amendment right the Court must assume it has when assessing standing-the right to repay its campaign debts in full, at any time. Pp. 3-6.

(b) The Government next argues that although appellees would have standing to challenge the FEC's implementing regulation, §116.11, they do not have standing to challenge Section 304 itself. The Government contends that the Committee used pre-election funds to repay the first $250,000, and thus Section 304's cap on using post-election funds to repay a candidate's loan does not prohibit repayment of the final $10,000 here. Instead, it is the agency's regulation-with its 20-day limit-that prevents repayment. Appellees insist that they used post-election funds-in the form of overlimit contributions to the 2018 campaign that were "redesignated" as contributions to the 2024

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campaign-to repay Cruz's loans. Ordinarily, it would not matter whether a plaintiff was challenging the statute's enforcement or instead the enforcement of a regulation. Here, however, the parties assume that the distinction makes a difference because the subject-matter jurisdiction of the three-judge District Court is limited to actions challenging the enforcement of the statute. See BCRA §304(a). Even under the Government's account, the present inability of the Committee to repay and Cruz to recover the final $10,000 is traceable to the operation of Section 304 itself. An agency's regulation cannot "operate independently of the statute that authorized it. California v. Texas, 593 U. S. ___, ___. Here, the FEC's 20-day rule was expressly promulgated to implement Section 304. Thus, if Section 304 is invalid and unenforceable, the agency's 20-day rule is as well, and the remedy appellees sought in the District Court would redress appellees' harm by preventing enforcement of the agency's 20-day rule. See Lujan, 504 U. S., at 561. In challenging the FEC's threatened enforcement of the loan-repayment limitation, through its implementing regulation, appellees may raise constitutional claims against Section 304, the statutory provision that, through the agency's regulation, is being enforced. Cf. Collins v. Yellen, 594 U. S. ___, ___ - ___. And because they are challenging "the constitutionality of [a] provision of [BCRA]," §403(a), jurisdiction was proper in the three-judge District Court. Pp. 6-10.

2. Section 304 of BCRA burdens core political speech without proper justification. Pp. 10-22.

(a) The loan-repayment limitation abridges First Amendment rights by burdening candidates who wish to make expenditures on behalf of their own candidacy through personal loans. Restricting the sources of funds that campaigns may use to repay candidate loans increases the risk that such loans will not be repaid in full, which, in turn, deters candidates from loaning money to their campaigns. This burden is no small matter. Debt is a ubiquitous tool for financing electoral campaigns, especially for new candidates and challengers. By inhibiting a candidate from using this critical source of campaign funding, Section 304 raises a barrier to entry-thus abridging political speech. Pp. 10-13.

(b) The Government has not demonstrated that the loan-repayment limitation furthers a permissible goal. Any law that burdens First Amendment freedoms, even slightly, must be justified by a permissible interest. Pp. 13-22.

(i) The only permissible ground for restricting political speech recognized by this Court is the prevention of "quid pro quo" corruption or its appearance. See McCutcheon v. Federal Election Comm'n, 572 U. S. 185, 207. Here, the Government argues that the contributions at issue raise a heightened risk of corruption because they are used to

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repay a candidate's personal loans. But given that these contributions are already capped at $2,900 per election in order to prevent corruption or its appearance, the approach of adding an additional layer of regulation is a significant indicator that the regulation may not be necessary for the interest it seeks to protect. See id, at 221. Because the Government is defending a restriction on speech, it must do more than "simply posit the existence of the disease sought to be cured"; it must instead point to "record evidence or legislative findings" demonstrating the need to address a special problem. Colorado Republican Federal Campaign Comm. v. Federal Election Comm'n, 518 U. S. 604, 618. "PVTJere conjecture" is "[injadequate to carry a First Amendment burden." McCutcheon, 572 U. S., at 210. Yet the Government is unable to identify a single case of quid pro quo corruption in this context, even though most States do not impose a limit on the use of post-election contributions to repay candidate loans. Pp. 13-16.

(ii) In the absence of direct evidence, the Government turns to a scholarly article, a poll, and statements by Members of Congress to show that the contributions used to repay candidate loans carry a heightened risk of at least the appearance of corruption. All of this evidence, however, concerns the sort of "corruption," loosely conceived, that this Court has repeatedly explained is not legitimately regulated under the First Amendment. Nor is it equivalent to "legislative findings" that demonstrate the need to address a special problem. Pp. 16- 19.

(iii) As a fallback argument, the Government analogizes postelection contributions used to repay a candidate's loans to gifts because they enrich the candidate as opposed to the campaign's treasury. But this analogy is meaningful only if the baseline is that the campaign will default. The record suggests, however, that winning candidates are commonly repaid in full. For these candidates, post-election contributions bear little resemblance to a gift; they instead restore the candidate to the status quo ante. As for losing candidates, the Government...

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