On Monday, September 10, 2018, the United States Court of Appeals for the Eighth Circuit found a Missouri law that banned donations between political action committees (“PACs”) violated the First Amendment. Judge Steven Colloton wrote that the law “limits the donor-PAC’s speech and associational rights under the First Amendment.”
In November of 2016, Missouri voters approved a state constitutional ban on PAC-to-PAC donations. The Missouri Ethics Commission argued that the ban was necessary to enforce caps on individual contributions and to promote transparency, since PAC transfers often shroud the source of large donations. In its ruling, the court found that the Missouri Ethics Commission’s only legitimate state interest is to prevent quid pro quo corruption or the appearance of said corruption. Further, the court held that the ban on PAC-to-PAC donations does not further said interest.
The Missouri Ethics Commission also argued that, without the ban, donors could skirt the individual contribution limits of $2,600 per candidate by “laundering [the donation] through a series of PACs that [the donor] controls.” The court was not surprised that the Missouri Ethics Commission did not provide any real world examples of said laundering, since “a donor determined to support a candidate with large sums of money need not employ PAC-to-PAC transfers. . . Why establish 385 separate PACs to donate $2600 each to a preferred candidate when the donor can spend $1 million independently to support the candidate?”
Finally, the court rejected the Missouri Ethics Commission’s argument that the “ban furthers the State’s anti-corruption interest by promoting transparency. The court rejected this argument on the grounds that contribution limits already prevent donations in excess of $2600 to a candidate by a single donor and that donors may not contribute to PACs with the purpose of concealing the source.
PACs have freedom of speech and association, 8th Circuit says in allowing transfers between PACs, ABA Journal (September 12, 2018)