CCP Brief: $18 Million Campaign Finance Fine is Unconstitutional

Excessive fine would harm First Amendment rights.

Alexandria, VA – Can a group be fined $18 million for not properly filing campaign finance reports?

An amicus brief filed today by the Center for Competitive Politics (CCP) says no. Such a massive penalty is unconstitutional under the Eighth Amendment to the Constitution that bars “excessive fines.” Large fines like this, CCP says, would also harm the First Amendment right to free speech.

The case, State of Washington v. Grocery Manufacturers Association, started in 2013 when the Grocery Manufacturers Association (GMA), a national trade group, opposed a ballot measure that would have mandated GMO labeling. To do so, the group contributed to a Washington State ballot committee, and was properly reported as a donor. The funds were fully under the trade group’s control, and GMA said it consulted multiple lawyers to ensure it complied with Washington law.

Nevertheless, the state of Washington, pursuing a complaint filed by supporters of the ballot measure, thought the group had acted improperly. The state demanded that GMA file as a political committee and disclose all of its donors. GMA promptly complied, filed the appropriate paperwork, and disclosed all of its contributions and spending involving the Washington ballot measure.

Despite this, the state of Washington sued the trade group. In a shocking decision, Judge Anne Hirsch of the Thurston County Superior Court found that not only was GMA guilty of violating Washington’s campaign reporting rules, it also intentionally evaded the law, allowing for the fine to be tripled. The court fined GMA an unprecedented $18 million.

Such a decision, were it to stand, would have incalculable First Amendment harms. As CCP argues in its amicus brief, “the Superior Court has imposed a massive fine – a death sentence for most groups – with tremendous potential to chill specially protected speech. That decision was in error and should be reversed.”

Fines of this severity are only reasonable to punish truly reprehensible conduct. Even if one fully supports Washington’s broad disclosure laws, this mammoth penalty “for a reporting violation … has no place in the context of core First Amendment activity, where ‘it is our law and our tradition that more speech, not less, is the governing rule.'”

“The GMA made – at worst – a good-faith, technical error, and then made every effort to fix its mistake,” said CCP Legal Director Allen Dickerson. “By imposing an excessive fine in response, Washington will inevitably cause other groups to wonder whether even careful political participation is worth the risk.”

The case is currently before the Washington State Court of Appeals, Division II.

CCP’s amicus brief is available here.

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