High court says no to 'Millionaire's Amendment'

WASHINGTON (CNN) -- The Supreme Court has struck down a provision of a federal campaign finance law that allowed opponents of wealthy candidates to exceed strict campaign spending limits.

The law was designed to "level the playing field," but the justices, by a 5-4 vote, said it unfairly punishes those who self-finance.

The challenge came from Jack Davis, a wealthy upstate New York businessman who is making his third run for Congress as a Democrat. He narrowly lost in 2006 to five-term incumbent GOP Rep. Tom Reynolds, who is not running for re-election this fall.

The ruling will have an immediate effect on the open seat Davis seeks. Democrats had for months targeted it as a competitive seat favoring their party this year.

The provision in question, part of the McCain-Feingold campaign finance reform law of 2002, was designed to reduce the spending advantage of wealthy congressional candidates.

Although it is called the "Millionaire's Amendment," the law applies when candidates spend more than $350,000 of their own money. Spending limits are then relaxed for opponents, letting them accept higher donor contributions to catch up. Individual donation limits can be tripled, in some cases, up to $6,900.

The amendment also allows greater spending by the opponent's party, and imposes added reporting requirements for spending on the self-financed candidate.

Writing for the majority, Justice Samuel Alito said Congress' "unprecedented step of imposing different contribution and coordinated party expenditure limits on candidates vying for the same seat is antithetical to the First Amendment."

Alito said that if the current system is "seriously distorting the electoral process," then "the obvious remedy" is to raise or lower current spending limits for all candidates. He was supported by his conservative colleagues Chief Justice John Roberts and Justices Antonin Scalia, Anthony Kennedy and Samuel Alito.

In dissent, Justice John Paul Stevens said the Millionaire's Amendment represents a "modest, sensible and plainly constitutional attempt by Congress to minimize the advantages enjoyed by wealthy candidates vis-a-vis those who must rely on the support of others to fund their pursuit of public office."

Davis, a former Republican, ran for Congress in 2004 but lost. In 2006, he spent $2.2 million of his own money but was again beaten by Reynolds.

The 75-year-old New York native said the amendment violated his free speech rights by treating his money differently from that of other candidates, and is simply a pro-incumbent tool imposed by entrenched members of Congress. He also said he was subject to additional accounting burdens that required greater spending disclosures in a shorter time frame than his opponents. A federal appeals court rejected his arguments.

The case is Davis v. Federal Election Commission (07-320).

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