Friday, December 22, 2006

Court Overturns Limits on Political Ads, Part of the Campaign Finance Law

The New York Times
Court Overturns Limits on Political Ads, Part of the Campaign Finance Law

WASHINGTON, Dec. 21 — A three-judge panel on Thursday overturned a key segment of the campaign finance law that banned issue advertisements paid for by corporate or union money in the critical weeks before federal elections.

The case, which was heard by a special federal court panel in Washington, now heads to the Supreme Court. If upheld, the ruling would unravel one of the tougher restrictions on the use of unregulated donations that interest groups pumped by the millions of dollars into political commercials.

The case was brought by Wisconsin Right to Life, which has been fighting the restrictions since 2004, claiming they infringe on its First Amendment guarantee of free speech, among other grounds.

Using its corporate treasury, the group had paid for advertisements denouncing Senate filibusters of judicial nominees and urging viewers to contact either Senator Russell D. Feingold, who was up for re-election that year, or the state’s other Democratic senator, Herb Kohl, who was not.

Under the 2002 McCain-Feingold campaign finance law, groups wanting to broadcast advertisements that name federal candidates within 60 days before a general election, or 30 days before a primary, are required to follow strict rules on how they pay for them. The law requires that donors be disclosed and caps contributions to prevent secretive groups from advocating for or against candidates in thinly disguised advertisements known as issue ads.

This case has been closely watched for several reasons. For one, organizations with quite disparate interests, including the American Civil Liberties Union, the National Rifle Association, the Chamber of Commerce and the conservative Club for Growth, have argued that they have a right to petition the government.

As grassroots lobbying groups, they say, they should be exempt from the ban on issue ads. Some have contended, most recently in an unsuccessful case before the Federal Election Commission, that their First Amendment rights are infringed upon because the law restricts them from pursuing their policy agendas in election seasons.

The court’s decision Thursday clearly loosened the clamps on such activities. Those who want to broadcast such ads are “going to push the envelope,” said Edward B. Foley, an election law expert at Ohio State University. “They’re going to explore the scope of this exemption.”

The case has already been heard by the Supreme Court, which kicked it back to the three-judge panel in January. The justices said the panel had misinterpreted a 2003 decision, in which they upheld the McCain-Feingold law, as foreclosing future challenges to the advertising restrictions.

The special panel that ruled Thursday did not consider the right-to-life group’s argument for an exemption as a grassroots lobbying organization. The 2-to-1 decision more narrowly found that the group’s ads did not violate restrictions against “express advocacy” for or against a federal candidate and were not campaign ads but general issue ads.

The majority opinion was by Judge David B. Sentelle of the United States Court of Appeals for the District of Columbia Circuit and Richard J. Leon of Federal District Court. Judge Richard W. Roberts of Federal District Court dissented.

The judges adhered strictly to the content of the actual commercials and rejected arguments by the government that the commercials were intended to influence the election. The advertisements did not state the senators’ views on the filibusters but urged viewers to call them.

The panel found that the government had not demonstrated a compelling enough interest to impose restrictions on these groups’ free speech rights. It said this section of the McCain-Feingold law was unconstitutional because it imposed campaign finance limits on organizations that were using advertisements to advance legislative policy.

Mr. Foley said the court reopened the door to use of corporate money.

“This is clearly a shift in direction and invites the use of corporate money,” Mr. Foley said, adding: “You can run ads about any policy issue you want to and you can name members of Congress in the ads. You can use corporate money for any ad that fits this profile.”

Mr. Foley said it would appear that so-called 527 groups, which emerged in the 2004 presidential campaign as a powerful force, would also be allowed to use corporate money for general issue ads under the Wisconsin decision. But the law is still murky on the regulation of 527’s, named for the part of the tax code that regulates them.

In the Wisconsin case, the F.E.C. had argued that the Wisconsin advertisements were clearly intended to try to defeat Mr. Feingold. The group’s opposition to the Senate filibustering of judicial nominees was closely linked to nominees who opposed abortion.

Representative Christopher Shays, Republican of Connecticut and a main architect of the campaign finance law, expressed disappointment in the decision.

“The lower court majority opinion ignores a wealth of evidence that shows W.R.T.L. had a ‘priority’ to defeat Senator Feingold in the 2004 election, and that the ads in question were part of that effort,” Mr. Shays said in a statement. Fred Wertheimer, head of Democracy 21, a campaign finance reform group, and one of the lawyers involved in the case, said he was hopeful that the Supreme Court would overturn the decision.

“We agree with the dissent in this case,” Mr. Wertheimer said, adding, “The context surrounding these ads, and not just the text and the face of these ads, must be considered in making this determination.”