FEDERAL ELECTION COMMISSION, Plaintiff-Appellee, v. T. Bertram LANCE, Defendant-Appellant.
No. 78-1859.
United States Court of Appeals, Fifth Circuit.
Jan. 15, 1981.
635 F.2d 1132
Therefore, although I concur in the majority‘s handling of the evidentiary questions, I cannot agree with its affirmance based on the jury constitution issue.
For these reasons, I dissent and would award a new trial.
Charles N. Steele, Kathleen Imig Perkins, Carolyn U. Oliphant, Gen. Counsel, Federal Election Commission, Washington, D. C., for plaintiff-appellee.
James A. McPherson, New Orleans, La., Kenneth J. Guido, Jr., Ellen G. Block, Washington, D. C., for amicus curiae Common Cause.
Before COLEMAN, Chief Judge, BROWN, AINSWORTH, GODBOLD, CHARLES CLARK, RONEY, GEE, TJOFLAT, HILL, FAY, RUBIN, VANCE, KRAVITCH, FRANK M. JOHNSON, Jr., GARZA, HENDERSON, REAVLEY, POLITZ, HATCHETT, ANDERSON, RANDALL, TATE, SAM D. JOHNSON and THOMAS A. CLARK, Circuit Judges.*
TJOFLAT, Circuit Judge:
The Federal Election Commission (FEC or Commission) brought this action to enforce an administrative subpoena requiring T. Bertram Lance to appear for a deposition and to produce certain documents. The subpoena is incident to an enforcement investigation of possibly illegal loans, some in the form of overdrafts, made by two national banks to the Bert Lance for Governor Campaign of 1974. The Commission began the investigation after determining, pursuant to
A panel of this court held that the district court correctly had rejected the arguments that Lance had raised in the enforcement proceedings, but declined to order enforcement of the subpoena because it concluded that “there exists a serious question whether the Federal Corrupt Practices Act is constitutional.” Federal Election Commission v. Lance, 617 F.2d 365, 367 (5th Cir. 1980). “If the FCPA is unconstitutional,” the panel reasoned, “then the subpoena, issued in aid of an investigation intended to enforce the Act, must be invalid as well.” Id. at 367. Nevertheless, the panel declined to resolve the constitutional issue, ruling that
We conclude that the provisions of the Act that Lance has standing to challenge are not facially unconstitutional and that none of Lance‘s other objections to the subpoena have merit. Therefore, we affirm the district court‘s order enforcing the subpoena.
* Judge Jerre S. Williams did not participate in the oral argument or the conference on this case and, therefore, does not participate in this decision.
Lance ran for Governor of Georgia in 1974. The Bert Lance for Governor Campaign Committee had checking accounts with two banks, the Calhoun First National Bank (Calhoun Bank) and the National City Bank of Rome, Georgia (National City Bank). The campaign ended on August 12, 1974, when Lance lost in the Democratic primary election. In April, 1975, the Enforcement and Compliance Section of the Comptroller of the Currency of the United States began an investigation of the financial dealings between the campaign committee and the Calhoun Bank. In a report dated September 22, 1975, the Comptroller set out its findings that the Calhoun Bank had repeatedly permitted the campaign committee to overdraw its accounts to pay campaign expenses. The overdrafts were still being repaid, the report stated, as late as January 31, 1975, and the bank “was paid no interest for the use of its money ....” Record at 37. The report concluded that these transactions indicated possible violations of the Federal Corrupt Practices Act as well as of
The Comptroller again scrutinized the financing of the 1974 Bert Lance for Governor Campaign in 1977 as a part of a comprehensive investigation of Lance‘s financial affairs. This second investigation concluded with a report, dated August 18, 1977, that further detailed the irregular extensions of credit by the Calhoun Bank to the campaign committee before, during, and after Lance‘s campaign.2
In September and November, 1977, the Federal Election Commission, acting on the basis of the reports issued by the Comptroller of the Currency, record at 4, found reason to believe that the Bert Lance for Governor Campaign Committee, the Calhoun Bank, and the National City Bank had violated
After making the requisite finding of “reason to believe” that the Act had been violated, see
The district court held a hearing on January 16, 1978, at which it considered briefs and affidavits filed by the parties. Lance raised the following arguments in the district court: (1) since
On appeal, Lance raised again the four arguments that he had advanced in the district court. In addition, he argued that the subpoena should be quashed on the ground that
The general rule is that, “in the absence of a miscarriage of justice, issues not raised or presented in the lower court will not be considered for the first time on appeal.” Excavators and Erectors, Inc. v. Bullard Engineers, Inc., 489 F.2d 318, 320 (5th Cir. 1973). In Higginbotham v. Ford Motor Co., 540 F.2d 762, 768 n.10 (5th Cir. 1976), we explained, “the rationale for the rule requires its application if additional facts would have been developed in the trial court had the new theory been presented there; in that case judicial economy is served and prejudice is avoided by binding the parties to the facts presented and the theories argued below.” Here, however, as in Higginbotham, the “new theory raises a purely legal question. No facts could have been developed to aid our resolution of the issue.” Id. Also as in Higginbotham, the parties have filed post-oral argument briefs discussing the issue at the request of the court. See id. In the circumstances of the case, we agree with the Higginbotham court that “it would be unjust to refuse to consider the new argument.” Id. See also Milhouse v. Levi, 548 F.2d 357, 363 (D.C.Cir.1976); United States v. Jones, 527 F.2d 817, 819 (D.C.Cir.1975).
Federal Election Commission v. Lance, 617 F.2d 365, 374 (5th Cir. 1980). The panel went on to hold, however, that it lacked jurisdiction to resolve the constitutional question:
Nevertheless, there is an additional bar to this panel‘s considering Lance‘s first amendment argument.
Section 437h(a) of the FECA provides: “The district court immediately shall certify all questions of constitutionality of this Act to the United States court of appeals for the circuit involved, which shall hear the matter sitting en banc.” Congress‘s obvious intent in enacting this section was to deprive district courts and panels of the circuit courts of appeals of jurisdiction to consider the constitutionality of the FECA. In our view, the outcome of the present appeal depends on the resolution of the question of the constitutionality ofsection 441b , which is, of course, part of the FECA. Therefore, we must submit this case to the en banc court for resolution of the first amendment issue.
The Commission, the national committee of any political party, or any individual eligible to vote in any election for the office of President of the United States may institute such actions in the appropriate district court of the United States, including actions for declaratory judgment, as may be appropriate to construe the constitutionality of any provision of this Act. The district court immediately shall certify all questions of constitutionality of this Act to the United States court of appeals for the circuit involved, which shall hear the matter sitting en banc.
As the Ninth Circuit, sitting en banc, recently observed, “[v]arious difficult questions can be raised about the meaning and constitutionality,” California Medical Association v. Federal Election Commission, No. 79-4426 (9th Cir. May 23, 1980) (en banc), of the section‘s requirement that “all questions of constitutionality of this Act” be heard by “the United States court of appeals for the circuit involved, which shall hear the matter sitting en banc.”
The sparse legislative history of
[Section 437h] originated as an amendment offered by Senator Buckley to expedite authoritative Supreme Court determination of the Act‘s constitutionality. The en banc requirement apparently was deemed to be an expediting mechanism due to a misconception that an en banc hearing was a matter of right following a hearing by a panel of three appellate judges; to require an initial en banc hearing was thus thought to eliminate a merely “preliminary” three-judge hearing.... That proposition is, of course, inaccurate: en banc hearings are discretionary. See
Fed.R.App.P. 35(a) . It has been suggested that the effect of an en banc requirement may be to impede rather than expedite. We are not prepared to say that has occurred in the instant case, but if mandatory en banc hearings were multiplied, the effect on the calendars of this court as to such matters and as to all other business might be severe and disruptive.
California Medical Association, at — (citations omitted).
We agree with the Ninth Circuit that “delicate questions” such as those raised by
Since we have decided to treat this case under Rule 35, there is no doubt, as there might be if we were to rely on
We adopt in full those portions of the panel opinion rejecting Lance‘s arguments that the subpoena should be quashed because (1) the statute of limitation bars the investigation; (2) the FEC has no jurisdiction to investigate violations of the FCPA that occurred prior to 1975; and (3) the subpoena is unduly burdensome and harassing. We conclude, however, that the panel should not have reached the merits of Lance‘s ex post facto clause claim because the claim is not ripe for adjudication.
The Supreme Court stated the general rule for determining ripeness in Aetna Life Insurance Co. v. Haworth, 300 U.S. 227, 240-41, 57 S.Ct. 461, 464, 81 L.Ed. 617 (1937):
The controversy must be definite and concrete, touching the legal relations of parties having adverse legal interests.... It must be a real and substantial controversy admitting of specific relief through a decree of a conclusive character, as distinguished from an opinion advising what the law would be upon a hypothetical state of facts.
See International Tape Manufacturers Association v. Gerstein, 494 F.2d 25, 27 (5th Cir. 1974). An important factor in considering ripeness is whether the tendered issue involves “uncertain and contingent future events that may not occur as anticipated, or indeed may not occur at all.” 13 Wright, Miller & Cooper, Federal Practice and Procedure § 3532 (1975).
In arguing that the Commission‘s investigation violates the ex post facto clause, Lance notes that the Commission‘s petition for enforcement of the subpoena expressly states that the subpoena was issued incident to an investigation under
We are unable to agree with this argument. A statute does not run afoul of the ex post facto clause unless it “‘makes an action done before the passing of the law, and which was innocent when done, criminal; and punishes such action,’ or ... ‘aggravates a crime, or makes it greater than it was, when committed.‘” Bouie v. City of Columbia, 378 U.S. 347, 353, 84 S.Ct. 1697, 1702, 12 L.Ed.2d 894 (1964) (quoting Calder v. Bull, 3 U.S. (3 Dall.) 386, 390, 1 L.Ed. 648 (1798)). Lance‘s argument demands that we first assume that any future FEC proceeding against the subjects of the investigation would necessarily depend solely on transactions that occurred before the enactment of
There is one other reason why the claim is unripe. Lance‘s claim depends on a finding that
Lance‘s only remaining argument against enforcement of the subpoena is that
In Buckley v. Valeo, the Supreme Court held unconstitutional the FECA‘s $1,000 per candidate ceiling on political “expenditures” in federal elections. Two years later, in First National Bank of Boston, the Court held unconstitutional as violative of the first amendment a Massachusetts statute prohibiting “business corporation[s] incorporated under the laws of or doing business in the Commonwealth” from making contributions or expenditures “for the purpose of ... influencing or affecting the vote on any question submitted to the voters ....” 435 U.S. at 768 n.2, 98 S.Ct. at 1412 [55 L.Ed.2d 707]. Dissenting in First National Bank of Boston, Justice White warned that the combined effect of Buckley v. Valeo and First National Bank of Boston was simply “to reserve the formal interment of the Corrupt Practices Act ... for another day.” 435 U.S. at 821, 98 S.Ct. at 1439 [55 L.Ed.2d 707]. Lance urges that Justice White was correct and that the day has arrived.
Federal Election Commission v. Lance, at 374.
Lance‘s first amendment attack is directed against
Congress clearly intended the prohibitions of the statute to be severable.
If any provision of this Act, or the application thereof to any person or circumstance, is held invalid, the validity of the remainder of the Act and the application of such provision to other persons and circumstances shall not be affected thereby.
The FEC investigation that generated the subpoena is founded on the Comptroller of the Currency‘s reports that the Lance campaign committee had been given bank loans, or overdrafts, out of the ordinary course of banking business. Supra at 1135. It is on the basis of these reports that the Commission rested its finding of “reason to believe” that the Act had been violated. Id. at 1136. The only portion of the Act that the Comptroller‘s reports suggest may have been violated is the portion prohibiting banks from making loans to political candidates except in the ordinary course of business. Neither Lance nor the Commission suggests that any reason exists to suspect that the subjects of the investigation may have violated any other part of the Act. Thus, the only part of the Act with which the investigation is concerned at this time is the prohibition against bank loans made out of the ordinary course of business.
We have no doubt that Lance has standing to challenge that particular prohibition, but we find that he does not have “such a personal stake” in the constitutionality of any other portion of the Act “as to assure that concrete adverseness which sharpens the presentation of issues upon which the court so largely depends for illumination of difficult ... questions.” Baker v. Carr, 369 U.S. 186, 204, 82 S.Ct. 691, 703, 7 L.Ed.2d 663 (1962).
Lance argues that this general standing requirement of “injury in fact” does not preclude his attacking
[T]he Court has altered its traditional rules of standing to permit—in the First Amendment area—“attacks on overly broad statutes with no requirement that the person making the attack demonstrate that his own conduct could not be regulated by a statute drawn with the requisite narrow specificity.” Dombrowski v. Pfister, 380 U.S. at 486, 85 S.Ct. at 1121 [14 L.Ed.2d 22]. Litigants, therefore, are permitted to challenge a statute not because their own rights of free expression are violated, but because of a judicial prediction or assumption that the statute‘s very existence may cause others not before the court to refrain from constitutionally protected speech or expression.
Broadrick v. Oklahoma, 413 U.S. 601, 612, 93 S.Ct. 2908, 2916, 37 L.Ed.2d 830 (1973). The Supreme Court emphasized in Broadrick that the doctrine must be employed sparingly:
The consequence of our departure from traditional rules of standing in the First Amendment area is that any enforcement of a statute thus placed at issue is totally forbidden until and unless a limiting construction or partial invalidation so narrows it as to remove the seeming threat or deterrence to constitutionally protected expression. Application of the overbreadth doctrine in this manner is, manifestly, strong medicine. It has been employed by the Court sparingly and only as a last resort. Facial overbreadth has not been invoked when a limiting construction has been or could be placed on the challenged statute.
Our initial problem in finding that Lance may invoke the overbreadth doctrine to attack prohibitions under
Further, the rationale of the overbreadth doctrine is simply not apposite in the context of a challenge to
Finally, Lance should not be allowed to use the overbreadth doctrine in this subpoena enforcement proceeding. We have, in the past, held that “the scope of issues which may be litigated in an [subpoena] enforcement proceeding must be narrow, because of the important governmental interest in the expeditious investigation of possible unlawful activity.” FTC v. Texaco, Inc., 555 F.2d 862, 873 (5th Cir. 1977). We think that allowing an overbreadth attack against the entire statute here would be at odds with our understanding of the appropriate role of the courts in determining whether a subpoena should be enforced.
In light of these considerations, we hold that Lance has standing to challenge
The Supreme Court‘s opinion in Buckley v. Valeo indicates that there exist important differences, for purposes of first amendment analysis of statutes regulating campaign speech, between “contributions” and “expenditures.” An expenditure, according to the Buckley approach, is a payment to a third party for the purpose of influencing the outcome of an election. Examples of such independent expenditures include the costs of distributing handbills or leaflets, the financing of speeches or rallies, and the financing of television or radio publicity. 424 U.S. at 19, 96 S.Ct. at 635. A contribution, on the other hand, is a direct payment to a candidate or campaign committee. Unlike the contributions the Court considered in Buckley, however, the overdrafts made to the Lance campaign committee out of the ordinary course of business had no speech elements at all. Because the overdrafts, according to the Comptroller‘s reports, were made out of the ordinary course of business, they were inherently private or secret, and were therefore not the sort of public expression of support for Lance and his views that would make them even “symbolic speech.” Since we find no significant speech elements in the transactions that the Commission is investigating, we hold that the FCPA‘s prohibition of such unsound banking practices in connection with elections does not violate the first amendment.7
Lance next argues that
We do not, however, think it proper to resolve the merits of Lance‘s vagueness challenge at this time. The vagueness doctrine has been developed in the context of, and it is applicable to, penal statutes. When a statute imposing civil penalties is claimed to be vague, we believe a court‘s proper role is to construe the statute‘s language, if possible, and then apply the statute as construed. Viewed this way, Lance‘s vagueness argument is simply inapposite unless the FTC seeks to proceed against him in a criminal proceeding. As we have earlier indicated in our analysis of Lance‘s ex post facto argument, we are unwilling to assume that the present investigation of Lance will result in his criminal prosecution. Supra at 1139. Accordingly, we find Lance‘s vagueness argument presently unripe for adjudication and do not consider it on this appeal.
VII
Lance‘s final argument is that
To evaluate this equal protection claim of Lance‘s, we must first decide the appropriate test of the statute‘s validity under the equal protection component of the fifth amendment. Lance suggests that because speech, a fundamental right, is involved, this court must strike down
VIII
Because we conclude that the provisions of
AFFIRMED.
It seems obvious that Congress did not intend to authorize or empower THE FEDERAL ELECTION COMMISSION to regulate or investigate state elections. As to elections per se, the very name of the Commission delineates the scope of its jurisdiction. The Act names no offices except elective federal offices. Except for enforcing applicable federal constitutional amendments governing the franchise, Congress may not usurp the regulation and supervision of state elections. That would be a blatant rupture of the federal system ordained by the Constitution.
The Commission offers no claim to the contrary. It says that it is only investigating what may have been illegal loans by national banks for the purpose of influencing the outcome of an election.
Here, the election took place in 1974. The statute was not then in effect. Some of it became effective on January 1, 1975 and other parts were not enacted until 1976. Prior to January 1, 1975 there was no authority for civil enforcement of the prohibition against loans of the type here in question, Cort v. Ash, 422 U.S. 66, 95 S.Ct. 2080, 2086, 45 L.Ed.2d 26 (1975).
The statute, non-existent in 1974, subjects Lance to a “civil” penalty of from $5,000 to $600,000, depending on the existence or non-existence of wilfulness. The majority opinion says that the ex post facto features of this situation are not ripe for adjudication because the Commission might not seek such a fine. This reads the ex post facto prohibition too restrictively. I believe that the prohibition applies to the hazard as well as the fact. I cannot agree that one may be made to run the gauntlet on the argument that, after all, he may not get hurt.
The simply stated, easily understood, demand of Article I, section 9, clause 3 of the Constitution is that Congress may not alter the existing situation of an individual to his disadvantage, Thompson v. Utah, 170 U.S. 343, 18 S.Ct. 620, 42 L.Ed. 1061 (1898); Burgess v. Salmon, 97 U.S. 381, 24 L.Ed. 1104 (1878).
In any event, to subject a person to a deposition and the production of documents while he is kept in the dark as to what the government is actually driving at in the way of consequences would be, I think, an impermissible denial of due process.
Taking judicial notice of the records of the U. S. District Court for the Northern District of Georgia, in this Circuit, and the applicable statutes of limitations in federal criminal prosecutions, we need not close our eyes to the known fact that criminal prosecution is no longer a possibility in this case. The only hope of punishing Lance and his associates in this matter, or otherwise putting them to a disadvantage by the necessity for employing attorneys, etc., is to use the procedure which the Commission now seeks to invoke and which it would have this Court to enforce.
I see no point in abstractions or a lot of judicial dancing around. Going straight to the point, I would hold that Lance may not now be required to respond to these subpoenas. I would certainly extend the denial to anything which took place after election day, August 13, 1974, because it would not have been done for the purpose of influencing the election, which is the sine qua non of the legislation.
The majority opinion concedes that the matter in question has been exhaustively investigated by other agencies of the Government—not once but twice. There is no suggestion that the product of these investigations is unavailable to the Federal Election Commission. Therefore, I would deny enforcement on the additional ground that the subpoena amounts to nothing more than unnecessary harassment.
My view of the case, if correct, makes it unnecessary to reach or decide the constitutionality of the Act as to conduct taking place after its effective date.
I respectfully dissent.
Notes
(Emphasis added.)(a) It is unlawful for any national bank, or any corporation organized by authority of any law of Congress, to make a contribution or expenditure in connection with any election to any political office, or in connection with any primary election or political convention or caucus held to select candidates for any political office, or for any corporation whatever, or any labor organization, to make a contribution or expenditure in connection with any election at which presidential and vice presidential electors or a Senator or Representative in, or a Delegate or Resident Commissioner to, Congress are to be voted for, or in connection with any primary election or political convention or caucus held to select candidates for any of the foregoing offices, or for any candidate, political committee, or other person knowingly to accept or receive any contribution prohibited by this section, or any officer or any director of any corporation or any national bank or any officer of any labor organization to consent to any contribution or expenditure by the corporation, national bank, or labor organization, as the case may be, prohibited by this section.
(b) ...
(2) For purposes of this section and
section 791(h) of title 15 , the term “contribution or expenditure” shall include any direct or indirect payment, distribution, loan, advance, deposit, or gift of money, or any services, or anything of value (except a loan of money by a national or State bank made in accordance with the applicable banking laws and regulations and in the ordinary course of business) to any candidate, campaign committee, or political party or organization, in connection with any election to any of the offices referred to in this section, but shall not include (A) communications by a corporation to its stockholders and executive or administrative personnel and their families or by a labor organization to its members and their families on any subject; (B) non-partisan registration and get-out-the-vote campaigns by a corporation aimed at its stockholders and executive or administrative personnel and their families, or by a labor organization aimed at its members and their families; and (C) the establishment, administration, and solicitation of contributions to a separate segregated fund to be utilized for political purposes by a corporation, labor organization, membership organization, cooperative, or corporation without capital stock.
From 1925 until 1976, the proscriptions now set out in