WASHINGTON, May 19 (UPI) -- A three-judge panel Monday temporarily stayed its own decision, striking down the core provisions of the ban on soft money in federal campaigns, pending an appeal to the Supreme Court.
The Supreme Court is expected to hear the appeal and make a final decision in the case. The justices could hear the case this summer -- the law requires an "expedited" appeal at the Supreme Court -- but more likely would hear argument next October.
On May 2, the three-judge panel issued a patchwork of opinions that essentially struck down the ban, but upheld some peripheral provisions.
The Justice Department then asked the three-judge court to stay its entire ruling until the Supreme Court takes the appeal and rules, saying a change in campaign fundraising so close to the 2004 elections would be "tumultuous."
The government's request was opposed by a group led by Sen. Mitch McConnell, R-Ky., one of the challengers of the ban.
McConnell was joined by fellow challengers, the National Rifle Association, the Republican National Committee, the California Democratic and Republican parties and the American Civil Liberties Union.
Two panel members, U.S. Circuit Judge Karen LeCraft Henderson and U.S. District Judge Colleen Kollar-Kotelly, issued a memorandum Monday saying they voted for the stay because of a "desire to prevent the litigants from facing potentially three different regulatory regimes" -- the one constructed by the Bipartisan Campaign Reform Act which contained the ban, the one constructed by the panel without the ban and a final one to be constructed by the Supreme Court -- "in a very short time span, and the court's recognition of the divisions among the panel about the constitutionality of the challenged provisions of the BCRA ..."
U.S. District Judge Richard Leon issued his own memorandum saying the court panel should not have stayed those peripheral provisions of the BCRA that were unanimously struck down.
The Justice Department filed its formal appeal last Thursday at the Supreme Court.
McConnell's group and the NRA group also filed formal appeals that day.
The BCRA amends the 1971 Federal Election Campaign Act.
The new act tries to address two categories of fundraising: (1) "the acceptance and use by political parties of 'soft money' (i.e., money raised outside the framework of FECA's disclosure requirements and source and amount limits) for the purpose of influencing federal elections; and (2) the growing use of corporate and union treasury funds for communications designed to influence, and generally known to influence the outcome of federal elections."
Before the BCRA, unregulated "soft money" could only be used for "party-building activities" such as voter-registration drives, and supposedly could not be used directly in a campaign. "Hard money" was subject to FECA's source disclosure requirements and strict limits, but could be used directly in a campaign.
However, the national parties had become skilled at blurring the lines between the two.
"In recent years ... soft money contributions to political parties have increased dramatically," the government said in its appeal. "Soft money has been used (among other things) to purchase advertisements that have featured federal candidates but have not expressly advocated a particular electoral result."
Congress "concluded that the effect of such practices was to enable corporations, labor unions and wealthy individuals to make unlimited and unreported contributions to political parties that were in turn used to benefit federal candidates," the government's appeal said, citing a 1978 landmark decision, "thus reintroducing the 'opportunities for abuse inherent in a regime of large financial contributions.'"
In 1976's Buckley vs. Valeo, the Supreme Court ruled it was unconstitutional to restrict how much an individual candidate could spend. Presidential candidates are publicly funded in the United States, but agree not to spend more than the amount allocated as a condition of getting the money.
However, the court upheld some limitations on contributions as long as the limits are designed to combat corruption or the appearance of corruption.
The BCRA says the national parties or their committees "may not solicit, receive or direct to another person a contribution, donation or transfer of funds or any other thing of value, or spend any funds, that are not subject to the limitations, prohibitions and reporting requirements" of FECA.
In other words, it banned soft money.
The new law did not put restrictions on how the parties could use the money; it just said that the money had to be accounted for and had to be contributed under hard money limits.
In its May 2 ruling, the three-judge panel struck down the BCRA's restrictions on the solicitation and use of soft money by national and state parties, except for "any public communication that refers to a clearly identified candidate for federal office and that promotes or supports a candidate for that office, or attacks or opposes a candidate for that office."
The divided panel also upheld the restrictions on the use of corporate and union general treasury funds for "electioneering communications," but narrowed the definition of such communications.
The Supreme Court could accept the appeal and hear the case early this summer, but more likely would hear the appeal next fall.
(Nos. 02-1676, FEC et al vs. McConnell et al; 02-1674, McConnell et al vs. FEC et al; and 02-1675, NRA et al vs. FEC et al.)