Lawyers offer mixed reviews of post-Citizens United leg. at ACS event

The campaign finance experts assembled at the American Constitution Society’s panel discussion about Citizens United v. Federal Election Commission seemed conflicted on the prospects for a congressional response.

BNA: Money & Politics Report focused on this angle in its report today ($):

Top election lawyers were sharply divided Feb. 24 in assessing the prospects for congressional legislation responding to the Supreme Court’s latest campaign finance decision in Citizens United v. Federal Election Commission (2683 Money & Politics Report, 1/22/10)… lawyers representing business interests said Congress faced thorny practical and constitutional issues and expressed doubts that legislators would be able to agree on proposals responding to the court’s ruling.

Meanwhile, lawyers for unions, liberal groups, and Democrats said they thought there was a good chance that new laws boosting disclosure of campaign-related spending and limiting campaigning by foreign-owned companies would be adopted in the wake of the court ruling.

Legal Times also covered the event.

Sen. Chuck Schumer and Rep. Chris Van Hollen, who are crafting the legislative package, announced a framework Feb. 11 and said they would release the bill’s proposed text this week. Congressional sources have indicated that the deadline may be pushed to next week because of the health care summit and other timing concerns.

James Portnoy, counsel for Kraft Foods, expressed “great skepticism” about Congress quickly passing legislation. Portnoy once worked as an attorney for the Democratic staff of the House Administration Committee, which has jurisdiction over campaign finance legislation.

He described the proposed legislation as a political response designed to press corporations, not a serious attempt to protect shareholders. He noted that shareholders do not have the power to micromanage other, more significant expenditures that corporations engage in, such as lobbying and charitable contributions.

Larry Gold, who represents the AFL-CIO, said he wouldn’t handicap the bill’s prospects as severely. He expressed concerns over an inevitable effort to extend similar restrictions on unions: “When that principle [shareholder restriction] is applied to other organizations [like unions] it becomes more problematic,” he said [clarifications added].

Unions, for example, should not be required to hold membership-wide votes for advance approval of political expenditures.

Joseph Sandler of Sandler Reiff & Young also said some parts of the bill could garner support, such as restrictions on U.S. subsidiaries of foreign corporations and enhanced disclosure of ads targeting congressional incumbents and candidates. He said shareholder governance regulations might be problematic because most corporations are regulated at the state level.

The shareholder governance regulations were not included in the Schumer-Van Hollen framework, although they indicated that such a provision could be added and some Democrats (particularly Rep. Michael Capuano) are pushing it in separate legislative proposals.

Jan Baran of Wiley Rein noted that Schumer and Van Hollen have made public statements regarding the intent of the bill—deterring corporations from independent political spending—that raise constitutional questions and might inform a court’s understanding of the bill’s intent if an organization challenged the legislation.

Reporters in the audience asked questions about the implications of a 20 percent foreign ownership standard for restricting associational First Amendment rights and the prospects for the “Stand By Your Ad” provision of the framework. No doubt the bill drafters are examining these issues deeply before releasing a bill with obvious constitutional problems—or at least we hope so.


The Center for Competitive Politics is now the Institute for Free Speech.