Ted Cruz campaign finance case before US Supreme Court | Messages

AUSTIN — A lawsuit filed by US Senator Ted Cruz’s campaign against the Federal Election Commission will be filed in the US Supreme Court next week as his campaign seeks to overturn campaign finance laws in his favor.

Cruz, who was first elected senator from Texas in 2012, hopes to repeal campaign finance laws that prohibit winning federal candidates from using more than $250,000 raised after an election to pay off loans they own own campaigns before election day. Oral hearings on the case will take place on January 19.

“It’s a case of free speech versus election regulation,” said Roger Borgelt, an Austin campaign finance attorney. “Over the years, there has been a trend … to repeal a number of federal campaign regulations and statutes on the grounds that they too severely limit the rights of First Amendment candidates.”

Proponents of the law claim it helps prevent quid pro quo corruption from occurring by allowing contributions to be exchanged for eventual political favors. The idea is that any money raised after an election no longer helps the candidate win, but goes directly into the candidate’s pocket.

The Campaign Legal Center, a non-profit organization working in the areas of campaign finance, ethics and voting rights, has advocated keeping the law. In the brief, the organization said the risk of corruption posed by a functionally personal “gift” given to a candidate is obvious.

“It is hardly new or implausible to think that a post-election donation that effectively goes straight into a candidate’s pocket could pose a corruption risk,” it said.

Borgelt, who does not take sides in the case, said he thinks that argument is weak because the campaigns are constantly raising funds for the next cycle, adding that fundraising is required 24 hours a day, 365 days a year.

“People donate to these campaigns almost constantly. You give before the choice; they get after the election – regardless of whether a loan is outstanding or not,” said Borgelt. “I’m not sure the timing issue of when the money will be given carries much weight.”

Another argument for those who want the law to be repealed is that it violates freedom of political expression. Over the past decade, SCOTUS has refined the concept that political expression is free speech and the most protected form of expression under the First Amendment.

Because the rule in question limits the amount of money a candidate can get back after an election, opponents argue that candidates are discouraged from borrowing their campaign funds, which would then hamper their messaging capabilities. This becomes an even greater burden for lesser-known candidates who need more resources to get their name and message out there.

“It takes a lot of money to get a political message out there where people need to hear it or where they want to hear it; really hear,” said Borgelt. “In my opinion it’s just an unfortunate fact, but it’s a fact that it takes a lot of money to get a message out.”

Borgelt’s point is echoed in a brief filed by the Institute for Free Speech, which said candidates who believe they can’t get their money back would be discouraged from investing in their campaigns and likely run altogether.

Don Daugherty, a senior lawyer who wrote the IFS letter, said that since election campaigns require a lot of money it is difficult to pay off all loans before election day and so it is common for there to be debt after elections, particularly on Federal election day.

Daugherty added that a key reason for the rule is to prevent corruption, but the FEC has not been able to come up with a known case of corruption. In the dozens of states where a similar rule does not exist, there have been no reports of corruption and the FEC is unable to provide credible reasons why the limit was set at $250,000, he said.

“The bottom line is that anything that limits the ability of candidates or supporters etc. to get their message across to voters, anything that limits that is better to have a damn good reason to be,” Daugherty said.


This particular case is about the McCain-Feingold Act, passed in 2002. According to a report by the Federal Election Commission, Cruz became involved after the law prevented him from recovering $545,000 of a $1 million personal loan he offered to campaign in 2012.

When Cruz’s campaign found that the regulations could not fully repay the loans, it began looking for ways to challenge the law, according to The Texas Tribune’s reporting. A day before the 2018 election, Cruz loaned his campaign $260,000 to fund the lawsuit.

In June, a federal district court ruled in favor of Cruz’s campaign, finding that limiting candidate loan repayments violated the First Amendment and the right to free political expression. The FEC appealed the ruling to the US Supreme Court.

Borgelt notes that the case is rather esoteric, but if historical campaign finance decisions are any indication, he believes the court will likely rule in favor of Cruz’s campaign as well.

“The Supreme Court has ruled that political speech and expenditure of money to promote political speech are protected under the First Amendment like any other kind of speech,” Borgelt said. “My educated guess – just a guess – is that they will uphold the Court of Appeal and that particular restriction will also be lifted.”

Daugherty said he hopes this case will also provide more constitutional clarity and guidance for lower courts, Congress and citizens given the convoluted nature of campaign finance laws.

He added that while Ted Cruz is bound by the lawsuit — which involves preconceived notions based on how people think about Cruz — it’s not about him. Rather, it is about freedom of expression, and should the judicial side cooperate with the lower courts, it would allow for a more robust pool of candidates.

“Sometimes these cases turn into [being] about the people involved… it’s not about him,” Daugherty said. “This is really about the First Amendment, and the rule at issue here really weighs more heavily on the challengers for political office than on the incumbent.”

Comments are closed.