Order Code RS22920
July 17, 2008
Campaign Finance Law and the
Constitutionality of the “Millionaire’s
Amendment”: An Analysis of Davis v.
Federal Election Commission
L. Paige Whitaker
Legislative Attorney
American Law Division
Summary
In a 5-to-4 decision, the Supreme Court struck down a provision of the Bipartisan
Campaign Reform Act of 2002 (BCRA), also known as the McCain-Feingold law,
establishing increased contribution limits for congressional candidates whose opponents
significantly self-finance their campaigns. This provision is frequently referred to as the
“Millionaire’s Amendment.” The Court found that the burden imposed on expenditures
of personal funds is not justified by the compelling governmental interest of lessening
corruption or the appearance of corruption and, therefore, held that the law is
unconstitutional in violation of the First Amendment.
Background
Section 319(a)1 of the Bipartisan Campaign Reform Act of 2002 (BCRA),2 also
known as the McCain-Feingold law, establishes increased contribution limits for House
candidates whose opponents significantly self-finance their campaigns. This provision
— in tandem with Section 304,3 which applies a similar program to Senate candidates
— is frequently referred to as the “Millionaire’s Amendment.” Basically, the complex
statutory formula provides that if a candidate for the House of Representatives spends
more than $350,000 of personal funds during an election cycle, individual contribution
limits applicable to his or her opponent are increased from the usual current limit ($2,300
per election) to up to triple that amount (or $6,900 per election). Likewise for Senate
candidates, a separate provision generally raises individual contribution limits for a
candidate whose opponent exceeds a designated threshold level of personal campaign
1 2 U.S.C. § 441a-1.
2 P.L. 107-155. BCRA amended the Federal Election Campaign Act (FECA), codified as
amended at 2 U.S.C. § 431 et seq.
3 2 U.S.C. § 441a(h), (i).

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funding that is based on the number of eligible voters in the state. For both House and
Senate candidates, the increased contribution limits are eliminated when parity in
spending is reached between the two candidates. BCRA also requires self-financing
candidates to file special disclosure reports regarding their campaign spending — as such
expenditures are made — in addition to reporting in accordance with the regular periodic
disclosure schedule.4
Case History
In 2004 and 2006, Jack Davis was a candidate for the House of Representatives from
the 26th Congressional District of New York. During the 2004 election cycle, he spent
$1.2 million, which was principally from his own funds, and during the 2006 cycle, he
spent $2.3 million, which (with the exception of $126,000) came from personal funds.
In 2006, after the Federal Election Commission (FEC) informed Davis that it had reason
to believe that he had violated BCRA’s disclosure requirements for self-financing
candidates by failing to report personal expenditures during the 2004 election cycle, Davis
filed suit in the U.S. District Court for the District of Columbia seeking declaration that
the Millionaire’s Amendment was unconstitutional and an injunction preventing the FEC
from enforcing the law during the 2006 cycle. A district court three-judge panel
concluded sua sponte that Davis had standing to bring the suit, but rejected his claims on
the merits and granted summary judgment to the FEC.5 Invoking BCRA’s provision for
direct appeal to the Supreme Court for actions brought on constitutional grounds,6 Davis
appealed.
Supreme Court Ruling
Reversing the three-judge district court decision, in a 5-to-4 vote, the Supreme Court
in FEC v. Davis7 invalidated the Millionaire’s Amendment as lacking a compelling
governmental interest in violation of the First Amendment. Justice Alito wrote the
opinion for the majority and was joined by Chief Justice Roberts, and Justices Scalia,
Kennedy, and Thomas. Justice Stevens wrote an opinion concurring in part and
dissenting in part, and was joined, in part, by Justices Souter, Ginsburg, and Breyer.
Justice Ginsburg also wrote an opinion, concurring in part and dissenting in part, which
was joined by Justice Breyer. The Court remanded the case to the district court for
proceedings consistent with its opinion.
Majority Opinion. Citing prior decisions, the Court began its opinion by noting
that it has long upheld the constitutionality of limits on individual contributions and
coordinated party expenditures.8 While recognizing that contribution limits implicate
First Amendment free speech interests, it has sustained such limits on the condition that
4 2 U.S.C. § 434(a)(6)(B).
5 See Davis v. FEC, 501 F. Supp. 2d 22 (D.D.C. 2007).
6 P.L. 107-155, § 403.
7 No. 07-320 (U.S. June 26, 2008).
8 See id., slip op. at 10 (citing Buckley v. Valeo, 424 U.S. 1, 23-35, 38, 46-47, n. 53 (1976); FEC
v. Colorado Republican Federal Campaign Comm., 533 U.S. 431, 437, 465 (2001)(Colorado II)).

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they are “closely drawn” to serve a “sufficiently important interest” such as the prevention
of corruption or the appearance of corruption.9 On the other hand, the Court observed that
it has definitively rejected any limits on a candidate’s expenditure of personal funds to
finance campaign speech, finding that such limits impose a significant restraint on a
candidate’s right to advocate for his or her own election, which is not justified by the
compelling governmental interest of preventing corruption. Instead of preventing
corruption, a candidate’s use of personal funds “‘reduces the candidate’s dependence on
outside contributions and thereby counteracts the coercive pressures and attendant risks
of abuse to which ... contribution limitations are directed.’”10
With regard to the Millionaire’s Amendment, the Court observed that while it does
not directly impose a limit on a candidate’s expenditure of personal funds, it “imposes an
unprecedented penalty on any candidate who robustly exercises that First Amendment
right.”11 Further, it requires a candidate to choose between the right of free political
expression and “subjection to discriminatory fundraising limitations.”12 If it simply
increased the contribution limits for all candidates — both the self-financed candidate as
well as the opponent — it would pass constitutional muster.13 Although many candidates
who can afford significant personal expenditures in support of their own campaigns may
choose to do so despite the Millionaire’s Amendment, the Court determined that they
would bear “a special and potentially significant burden if they make that choice.”14 In
fact, the Court concluded that if a candidate vigorously exercises the right to use personal
funds, it creates a fundraising advantage for his or her opponents.15
In its 1976 landmark decision Buckley v. Valeo,16 the Supreme Court upheld a
provision of the Federal Election Campaign Act (FECA) providing presidential candidates
with the option to receive public funds on the condition that they comply with expenditure
limits, even though it found overall expenditure limits to be unconstitutional.17
Distinguishing the Millionaire’s Amendment from FECA’s presidential public financing
provision, the Davis Court observed that the choices presented by each of the statutes are
9 Id., slip op. at 10-11 (quoting McConnell v. FEC, 540 U.S. 93, 136, 138, n. 40 (2003); Colorado
II, 533 U.S. at 456 (2001); Nixon v. Shrink Missouri Government PAC, 528 U.S. 377, 387-88
(2000); Buckley v. Valeo, 424 U.S. 1, 25-30, 38 (1976)).
10 Id., slip op. at 12 (quoting Buckley, 424 U.S. at 53 (1976)).
11 Id.
12 Id.
13 See id., slip op. at 10-11.
14 Id., slip op. at 12-13 (citing Day v. Holahan, 34 F. 3d 1356, 1359-60 (8th Cir. 1994) (holding
that a Minnesota statute that increased candidate expenditure limits and eligibility for public
funds based on the amount of independent expenditures made in opposition to his or her
candidacy burdened the speech of those making the independent expenditures)).
15 See id., slip op. at 13.
16 424 U.S. 1 (1976). For further discussion of Buckley, see CRS Report RL30669, The
Constitutionality of Campaign Finance Regulation: Buckley v. Valeo and Its Supreme Court
Progeny, by L. Paige Whitaker.
17 See id. at 57, n. 65, 54-58.

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“quite different.”18 By forgoing public financing, a presidential candidate can still retain
the unencumbered right to make unlimited personal expenditures. In contrast, the
Millionaire’s Amendment fails to provide any options for a candidate to exercise that
right “without abridgement.”19
Finding that the Millionaire’s Amendment imposes a “substantial burden” on the
First Amendment right to expend personal funds in support of one’s own campaign,
thereby triggering strict scrutiny, the Court announced that it is not sustainable unless it
can be justified by a compelling governmental interest.20 As the Court held in Buckley,
reliance on personal funds reduces the threat of corruption, and therefore, the burden
imposed by the Millionaire’s Amendment cannot serve that governmental interest.
Responding to the FEC’s argument that the statute’s “asymmetrical limits” are
justified because they level the playing field for candidates of differing personal wealth,
the Court pointed out that its jurisprudence offers no support for the proposition that this
rationale constitutes a compelling governmental interest. According to the Court,
“[p]reventing corruption or the appearance of corruption are the only legitimate and
compelling government interests thus far identified for restricting campaign finances.”21
Moreover, “‘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.’”22
Specifically, the Court cautioned that restricting a candidate’s speech in order to
level opportunities for election among candidates presents “ominous implications”
because it would permit Congress to “arrogate the voters’ authority to evaluate the
strengths of candidates competing for office.”23 Voters are entrusted with the duty to
judge candidates for public office and, according to the Court,
Different candidates have different strengths. Some are wealthy; others have wealthy
supporters who are willing to make large contributions. Some are celebrities; some
have the benefit of a well-known family name. Leveling electoral opportunities
means making and implementing judgments about which candidates should be
permitted to contribute to the outcome of an election. The Constitution, however,
confers upon voters, not Congress, the power to choose the Members of the House of
Representatives, Article I, § 2, and it is dangerous business for Congress to use the
election laws to influence the voters’ choices.24
18 Davis, slip op. at 13.
19 Id.
20 See id., slip op. at 14.
21 Id., slip op. at 15 (quoting FEC v. National Conservative Political Action Comm., 470 U.S.
480, 496-97 (1985); Randall v. Sorrell, 548 U.S. 230, 268 (2006) (Thomas, J., concurring in
judgment) (noting “the interests the Court has recognized as compelling, i.e., the prevention of
corruption or the appearance thereof”)).
22 Id., slip op. at 15-16 (quoting Buckley, 424 U.S. at 48-49 (1976)).
23 Id., slip op. at 16.
24 Id.

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In considering the constitutionality of the disclosure requirements contained within
the Millionaire’s Amendment, the Court emphasized that it has repeatedly held that
compelled disclosure significantly infringes on privacy of association and belief, as
guaranteed under the First Amendment. Therefore, it has subjected such requirements to
exacting scrutiny in order to ascertain whether there is a “relevant correlation” or
“substantial relation” between the governmental interest and the information required to
be disclosed.25 In view of its holding that the Millionaire’s Amendment is
unconstitutional, the Court likewise reasoned that the burden imposed by its disclosure
requirements cannot be justified, and accordingly, struck them down.26
Dissenting Opinions. In a dissent, Justice Stevens — joined, in part, by Justices
Souter, Ginsburg, and Breyer — argued that the Millionaire’s Amendment represents
Congress’s judgment that candidates who spend over $350,000 of their own money in a
campaign for a House or Senate seat have an advantage over other candidates who must
raise contributions. The statute imposes no burden on self-financing candidates and
“quiets no speech.”27 Instead, the dissent found that it does no more than merely “assist
the opponent of a self-funding candidate” to make his or her voice heard and that “this
amplification in no way mutes the voice of the millionaire, who remains able to speak as
loud and as long as he likes in support of his campaign.”28 As a result of finding no direct
restriction on the speech of the self-financed candidate, the dissent would subject the
Millionaire’s Amendment to a less rigorous standard of review.29 Indeed, the dissent
specifically criticized the Court’s landmark Buckley ruling, which struck down limits on
expenditures, arguing that “a number of purposes, both legitimate and substantial,” can
justify the imposition of reasonable spending limits.30
Maintaining that combating corruption and the appearance of corruption are not the
only governmental interests justifying congressional regulation of campaign financing,
the dissent remarked that the Court has also recognized the governmental interests of
reducing both the influence of wealth and the appearance of wealth on the outcomes of
elections. While conceding that such prior decisions have focused on the aggregations
of wealth that are accumulated in the corporate form, it reasoned that the logic of such
decisions — particularly concerns about the “corrosive and distorting effects of wealth”
on the political process — could be extended to the context of individual wealth as well.31
25 Id., slip op. at 18.
26 See id.
27 Id., slip op. at 5 (Stevens, J., dissenting).
28 Id., slip op. at 5-6 (Stevens, J., dissenting).
29 See id., slip op. at 2-3 (Stevens, J., dissenting) (quoting Justice White’s dissent in Buckley
maintaining that expenditure limitations should be analyzed not as direct restrictions on speech,
but as analogous to time, place, and manner regulations, which are sustainable on the condition
that they serve purposes that are “legitimate and sufficiently substantial.” Buckley v. Valeo, 424
U.S. 1, 264 (1976) (White, J., concurring in part and dissenting in part)).
30 Id., slip op. at 3 (Stevens, J., dissenting).
31 Id., slip op. at 8 (Stevens, J., dissenting).

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In a separate dissent, Justice Ginsburg — joined by Justice Breyer — concluded that
sustaining the constitutionality of the Millionaire’s Amendment would be consistent with
the Court’s earlier holding in Buckley v. Valeo. She resisted, however, joining Justice
Stevens’s dissent to the extent that it addresses the Court’s ruling in Buckley invalidating
expenditure limits. Noting that the Court had not been asked to overrule Buckley — and
that this issue had not been briefed — Justice Ginsburg preferred to leave reconsideration
of that case “for a later day.”32
Concluding Observations
The Court’s decidedly antiregulatory opinion in Davis appears to be a reaffirmation
of its finding in the landmark 1976 decision, Buckley v. Valeo, that Congress has no
compelling interest in attempting to level the playing field among candidates. In fact, the
Davis Court determined that Congressional attempts to do so would supplant the choices
of the voters. Notably, the decision also seems to be a departure from its 2003 decision
in McConnell v. FEC33 — upholding key portions of BCRA — where the Court expressed
deference to Congress’s expertise in regulating the system under which its Members are
elected.34 While Justice Stevens still appears to subscribe to this view,35 the majority of
the Davis Court seems less deferential.
32 Id., slip op. at 1 (Ginsburg, J., dissenting).
33 540 U.S. 93 (2003). For further discussion of McConnell, see CRS Report RL32245,
Campaign Finance Law: A Legal Analysis of the Supreme Court Ruling in McConnell v. FEC,
by L. Paige Whitaker.
34 In McConnell v. FEC, the Court notably deferred to Congressional findings in upholding
BCRA, remarking that its decision showed “proper deference” to Congress’s determinations “in
an area in which it enjoys particular expertise.” Furthermore, “Congress is fully entitled,” the
Court observed, “to consider the real-world” as it determines how best to regulate in the political
sphere. 540 U.S. 93, 137, 188 (2003).
35 See Davis, slip op. at 4, 9 (Stevens, J., dissenting) (“It seems to me that Congress is entitled to
make the judgment ...” and “as we explained in McConnell, ‘Congress is fully entitled to consider
... real-world differences ... when crafting a system of campaign finance regulation.’”) (Stevens,
J., dissenting) (quoting McConnell, 540 U.S. at 188 (2003)).

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