Daily Media Links 9/9

September 9, 2019   •  By Alex Baiocco   •  
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New from the Institute for Free Speech

Amicus Brief: $6 Million Fine for Campaign Finance Reporting Errors Violates First, Eighth Amendments

The Institute for Free Speech filed an amicus brief with the Washington Supreme Court late Friday stating that a lower court erred in failing to apply constitutional scrutiny to a $6 million fine assessed for campaign finance violations. The First and Eighth Amendments do not allow such massive penalties for speakers whose only errors involve registration and reporting of perfectly legal expenditures, the brief says.

“The threat of multi-million dollar fines for technical violations will cause many groups to avoid speaking on public issues. The Eighth Amendment prohibits excessive fines, and that protection is especially important where those fines are directed at political speech,” said Institute for Free Speech Legal Director Allen Dickerson.

The Grocery Manufacturers Association (GMA), a national trade group, was fined in 2016 for reporting errors in its ballot measure advocacy. The group reported all of its contributions, and voters knew of GMA’s economic interests in opposing a ballot measure. Nevertheless, the state imposed a massive $6 million fine on GMA for failing to register and report as a political committee. The fine was later trebled to $18 million, which the state’s Attorney General hailed as “historic.”

A state court of appeals reduced the fine to the original $6 million, but did not subject this base fine to constitutional scrutiny. The Institute for Free Speech’s brief explains that this huge fine is excessive and will chill protected speech…

The Institute asks the Washington Supreme Court to remand the case for consideration of First and Eighth Amendment concerns. The case is State of Washington v. Grocery Manufacturers Association.

Institute for Free Speech Amicus Brief in State of Washington v. Grocery Manufacturers Association, Washington Supreme Court (September 6, 2019)

Washington’s Attorney General hailed as “historic” the Superior Court’s imposition of an $18 million fine for reporting errors related to ballot-issue advocacy. Those reporting errors did not involve bribery or anything related to quid pro quo corruption: There were no candidates or office holders to be corrupted. The Grocery Manufacturers Association’s (“GMA”) error did not conceal the interests of those funding the opposition to the ballot measure: The full amounts contributed were reported, voters knew GMA’s and its members’ interests, and the contributions were themselves legal.

The Court of Appeals reduced the fine to $6 million to cure the Superior Court’s errors in statutory interpretation, but the Court of Appeals erred in not subjecting the base and punitive fines to constitutional scrutiny. Whether $6 million or $18 million, the fines here are massive-a death sentence for most groups. And groups will silence themselves, knowing that complaints by ideological opponents may result in terminal penalties. Such fines therefore suppress “speech about public issues,” which “commands the highest level of First Amendment protection.”

Neither the trebled fine nor the base fine pass such constitutional scrutiny. Because the fines target protected political speech, they must meet the scrutiny required under both the First and Eighth Amendments to the United States Constitution. The Eighth Amendment’s gross disproportionality analysis, properly accounting for the First Amendment burdens at issue here, requires that the actual burdens imposed for noncompliance with a disclosure law be substantially related to the government’s informational interest. The trebled fine is not substantially related to the State’s interest in punishing reprehensible conduct. And given the tenuous relationship between the additional disclosure demanded by the State and the informational interest, the burdensome base fine also cannot survive constitutional scrutiny. Accordingly, while the decision by the Court of Appeals to reverse the trebled fine should be affirmed-on both statutory and constitutional grounds-the First and Eighth Amendments require that the base fine be reversed as well.

First Amendment 

Wall Street Journal: Liberal City Tags Speech as Terrorism

By Walter Olson

Only Congress can declare war, but the San Francisco Board of Supervisors is trying. Last week it voted unanimously to brand the National Rifle Association, an association with millions of American members, a “domestic terrorist organization.”…

An even greater problem for the supervisors is that the NRA and its members are generally law-abiding. The resolution therefore claims that even otherwise lawful acts-such as training or providing funds-that assists or enables someone you should have known might misuse weapons constitutes “material support.” That includes the NRA’s “advocacy,” “propaganda” and “promotion” both of gun ownership and of “extremist positions.” In a word, speech. Thus the supervisors purport to classify as terrorism the expression of opinions with which they disagree.

The resolution is mostly symbolic, but it does order city officials to “take every reasonable step to limit those entities who do business with the City and County of San Francisco from doing business with” the NRA. That’s almost certainly unconstitutional. In Board of County Commissioners v. Umbehr (1996), the Supreme Court held that terminating a contract in response to the contractor’s protected speech violates the First Amendment. The vote was 7-2, with only Justices Antonin Scalia and Clarence Thomas dissenting.

The general issue has been in the news in recent years because of cities’ moves to keep conservative-owned businesses like Chick-fil-A from getting concessions in airports and similar facilities, or even in one case from obtaining routine permits. Last month a federal judge allowed the NRA to proceed with a lawsuit challenging a less extreme Los Angeles ordinance that requires city contractors to disclose (but not discontinue) their associations with the gun group. The judge ruled that in the context of the NRA’s First Amendment claims, even commercial ties such as discount partnerships could be construed as “expression.”

Washington Post: No, San Francisco. The NRA is not a ‘domestic terrorist organization.’

By Henry Olsen

[The resolution] states that “the National Rifle Association through its advocacy has armed those individuals who would and have committed acts of terrorism.” You can’t get clearer than that: Constitutionally protected speech supporting the private ownership of guns is an act of terror…

Congratulations, average NRA member: Your $30 one-year membership makes you a terrorist.

This is McCarthyism, pure and simple. Wisconsin Sen. Joseph McCarthy was rightly condemned for trying to stigmatize the American left in the 1950s by labeling it Communist and “un-American.” McCarthy’s witch hunts destroyed the careers of many people whose only “crime” was supporting a larger federal government and supporting a different foreign policy toward the Soviet Union. San Francisco’s policy toward the NRA commits the same sin.

This can only make our already toxic political atmosphere worse. Liberal democracy rests on the idea of the “loyal opposition.” In modern democracies, simply advocating a political position or a change in government is not, as so often was the case in the past, an act of treason. The First Amendment exists to provide citizens with a protected zone in which they can engage in heated political disagreement without fear of government suppression.

The San Francisco resolution essentially declares that people who back the NRA cannot be a loyal opposition. It then seeks to reduce NRA support by saying that the city should try to “limit those entities who do business” with the city “from doing business with this domestic terrorist organization.” That arguably sets the power of a government against a set of citizens solely on the basis of their politics. This is called “viewpoint discrimination” in First Amendment law and is unconstitutional.

Washington Post: Justice for Scabby the Rat

By Mark Lasswell

Peter B. Robb, who was appointed general counsel by President Trump in 2017 after a long career advocating for management in labor disputes, began issuing balloon-related memorandums and court filings with one thing in mind: rodenticide. He seemed intent on upending an Obama-era NLRB policy that treated Scabby’s personal appearances as a protected form of speech – a view reflected in rulings by courts and previous NLRB boards since the balloon’s debut three decades ago.

In recent months, Robb’s office has objected to inflatable rats outside supermarkets in Staten Island, N.Y., whose owner stoked the ire of a construction local that accused him of planning a new store in a shopping center built with non-union labor. Robb has also targeted the balloons near the entrance of a Philadelphia hotel that union electricians resented for using an electrical contractor that employed non-union workers.

Scabby the Rat’s inflatable pal, Fat Cat (which smokes a cigar and clutches a worker in its pillowy paw), prompted a memorandum from Robb’s office in December. The balloon had been deployed near a Chicago construction site to decry a contractor’s use of a non-union subcontractor at a different site.

Robb’s anti-rat-and-cat campaign is focused on that kind of “secondary” protest, when unions pursue a beef against a specific contractor by targeting neutral businesses that happen to employ the offending contractor. The magic word in the NLRB general counsel’s paperwork is “coercive” – the National Labor Relations Act blesses secondary protests as long as they don’t force customers or businesses to behave in a way that the union would find more appealing…

Robb’s efforts so far have been conducted in the realm of memos and lower-court skirmishes, but they could be a prelude to a formal NLRB ruling against Scabby, which would prompt a serious court fight over the First Amendment and labor rights.

Supreme Court

Washington Post: The Supreme Court has become just another arm of the GOP

By U.S. Senator Sheldon Whitehouse

From 2005 through the fall term of 2018, the Roberts court issued 73 5-to-4 partisan decisions benefiting big Republican donor interests…

The big-donor takeover of the federal courts begins, as reported by The Post, with a sprawling network of organizations funded by at least a quarter-billion dollars of largely anonymous money…

With its judges in place, the network lobbies the court with anonymously funded amicus briefs, signaling how the judges should vote…

My own calls for judicial reform have been for transparency around the dark money behind judicial nominations and amicus briefs; for improved ethics reporting and a court code of ethics; and for justices to follow principles they espouse at confirmation hearings such as respect for precedent, judicial modesty, deference to duly passed laws of Congress, letting fact-finders find the facts, and calling balls and strikes apolitically. None of that seems unreasonable.

The right-wing eruption offered no defense of why a multimillion-dollar secret influence apparatus should be involved in selecting justices and campaigning for their confirmation and filing anonymous amicus briefs…

Instead, we saw precisely the howl of coordinated, multiple-mouthpiece misdirection you would expect to hear from big donors whose scheme to capture the Supreme Court for one team was suddenly exposed and is now at risk.

FEC

Washington Post: We need our elections protected. A weakened FEC only invites attack.

By Editorial Board

[T]his is a precarious time for the commissioners to lack a quorum. The 2016 presidential election was undermined by interference from Russia, and the upcoming campaign seems equally vulnerable to mischief and meddling. Moreover, the need is greater than ever to police the torrents of cash flowing into campaign coffers, much of it in dark money from shady interest groups. The lack of a quorum at the FEC is an open invitation to those who want to skirt the law to gamble that they won’t be caught until later, if at all.

President Trump has repeatedly leveled the charge, of which there is no evidence, that there was massive voter fraud in 2016. If he were really interested in keeping U.S. elections clean and transparent, he would make a special effort to bring the FEC back up to speed. Senate Majority Leader Mitch McConnell (R-Ky.) has long wanted to neuter the FEC. Both he and Mr. Trump have the power to fix it – and have not…

Meanwhile, all three current serving commissioners are holdovers first appointed in the presidency of George W. Bush. It looks as though politicians have done their best to weaken the FEC just as the nation heads into an election cycle. Whose interest does that serve?

Congress

The Hill: Nadler schedules vote on procedures for impeachment probe

By Olivia Beavers

The head of the House Judiciary Committee announced Monday that the panel will vote this week to adopt procedures for hearings as it seeks to determine whether to introduce articles of impeachment against President Trump.

Judiciary Chairman Jerrold Nadler (D-N.Y.) said the committee will vote Thursday on a resolution that would solidify several key policies…

The announcement comes as Nadler and his committee are quickly expanding their probe beyond former special counsel Robert Mueller’s report to include a series of new areas, including reports Trump dangled pardons to border and law enforcement officials, hush money payments made to women alleging affairs with the president and whether Trump profited from government spending as administration officials stayed at his family-owned properties during work trips.

“Trump’s crimes and corruption extend beyond what is detailed in the Mueller report,” Nadler said. “The President is in violation of the emoluments clauses of the Constitution as he works to enrich himself, putting the safety and security of our Nation at risk. He has dangled pardons, been involved in campaign finance violations and stonewalled Congress across the board, noting that he will defy all subpoenas.”

Independent Groups

OZY: Meet the Democrats’ Most Dangerous Digital Strategist

By Nick Fouriezos

Indeed, Acronym has taken hardly any time in breaking the strategy-firm ecosystem in the nation’s capital. By the end of 2018, it had raised and managed more than $18 million, registered 60,000 voters, run 105 targeted ad campaigns in 15 states, helped elect 63 progressive candidates and won 61 percent of the races it invested in. Its staff has grown from five to 38 and it has quickly become one of the go-to digital organizing forces for everyone from Planned Parenthood and Emily’s List to Everytown for Gun Safety and the Democratic Congressional Campaign Committee…

While the numbers are impressive, what could upend Washington politics entirely is the structure of her organization. Unlike most digital strategists, her operation is what the IRS classifies as a 501(c)(4) nonprofit – meaning a majority of its funds must be used to promote “social welfare.” And yet, Acronym has a web of for-profit companies beneath it: a campaign consulting firm (Lockwood Strategy), a political tech company with a peer-to-peer texting product (Shadow) and a media company investing in local left-leaning outlets (FWIW Media). In the works is an apparel arm (Rogue Swag) that would be the first major liberal answer to conservative companies that skirt campaign finance laws by selling politically branded clothing over Facebook and elsewhere – spreading political messaging without having to report the spending.

It means the nonprofit Acronym is able to raise money, invest in for-profit companies to advance progressive aims and then return any profits back into its mission. “People don’t understand why I am creating a model that I can’t get very rich off of. Because I don’t own the companies; the (c)(4) does,” [Tara McGowan] says.

Fundraising 

New York Times: How Elizabeth Warren Raised Big Money Before She Denounced Big Money

By Shane Goldmacher

[E]arly this year, Ms. Warren made a bold bet that would delight the left: She announced she was quitting this big-money circuit in the 2020 presidential primary, vowing not to attend private fund-raisers or dial up rich donors anymore. Admirers and activists praised her stand – but few noted the fact that she had built a financial cushion by pocketing big checks the years before.

The open secret of Ms. Warren’s campaign is that her big-money fund-raising through 2018 helped lay the foundation for her anti-big-money run for the presidency. Last winter and spring, she transferred $10.4 million in leftover funds from her 2018 Senate campaign to underwrite her 2020 run, a portion of which was raised from the same donor class she is now running against.

As Ms. Warren has risen in the polls on her populist and anti-corruption message, some donors and, privately, opponents are chafing at her campaign’s purity claims of being “100 percent grass-roots funded.” Several donors now hosting events for her rivals organized fund-raisers for her last year.

“Can you spell hypocrite?” said former Gov. Ed Rendell of Pennsylvania, who contributed $4,000 to Ms. Warren in 2018 and is now supporting former Vice President Joseph R. Biden Jr.

Mr. Rendell said he had recruited donors to attend an intimate fund-raising dinner for Ms. Warren last year… He said he received a “glowing thank-you letter” from Ms. Warren afterward.

But when Mr. Rendell co-hosted Mr. Biden’s first fund-raiser this spring, Ms. Warren’s campaign sent brickbats, deriding the affair as “a swanky private fund-raiser for wealthy donors,” the likes of which she now shuns.

“She didn’t have any trouble taking our money the year before,” Mr. Rendell said. “All of a sudden, we were bad guys and power brokers and influence-peddlers. In 2018, we were wonderful.”

Online Speech Platforms 

Forbes: Russia Accuses Facebook And Google Of Illegal Election Interference

By Zak Doffman

The “facts,” the country’s communications regulator Roskomnadzor says in its statement, point to “the distribution of political advertising on Google and Facebook at a time prohibited by Russian election law.”…

These new allegations relate to the running of political ads on voting day-September 8, despite, the regulator says, warnings that such action would break the country’s election laws. “During the monitoring of mass media on voting day, on Google’s search engine, on Facebook and on YouTube, political advertising was established.”

Roskomnadzor claims the actions of the U.S. giants “can be considered as interference in the sovereign affairs of Russia and obstructing the holding of democratic elections in the Russian Federation.”…

According to Russian media, a member of Russia’s Civic Chamber, Aleksandr Malkevich, claimed that Google “displayed ads for the so-called ‘Smart Voting’ system promoted by opposition figure and video blogger Aleksey Navalny-these ads are said to have been shown to users searching for data on the local elections in Moscow.”

Meanwhile, Facebook allegedly “blocked two posts that Moscow’s Election Commission had tried putting up on its account-detailing how violations during the ongoing vote are being verified.”

The States

New York Times: Better Government for New York

By Editorial Board

New York this fall has the best chance in years to adopt a strong system of public financing. Done right, this new policy could increase competition and amplify the voices of small donors in elections. That is, if career politicians don’t kill it first.

Candidates who choose to participate in public financing programs receive a match in taxpayer dollars for donations they raise privately. New York City’s public financing system, in place since 1988, has helped make elections far more competitive, by helping newcomers with fresh ideas run for office.

In Albany, securing a public financing system for state elections has been harder, and proposals have languished. Advocates for public financing were hopeful when Democrats took control of the State Senate this year. But lawmakers demurred, largely over opposition in the Assembly. The state budget called for the establishment of a public financing system, but Gov. Andrew Cuomo and the Legislature left its details and fulfillment up to a nine-member commission.

On Tuesday at 4 p.m., that commission is scheduled to hold the first of four public hearings at the Borough of Manhattan Community College in Lower Manhattan. Its final plan is due Dec. 1, and that plan will automatically become law unless the Legislature moves to block it within 20 days.

USA Today: Google targeted in antitrust inquiry by attorneys general in 48 states, DC and Puerto Rico

By Rachel Lerman, Associated Press

A group of states led by Texas launched an investigation into Google to examine whether the Silicon Valley tech giant has gotten too big and effective at stomping or acquiring rivals.

The inquiry is the latest blow against big tech companies as antitrust investigations ramp up in the USA and around the world. A separate group of states announced an investigation into Facebook’s dominance Friday. The Department of Justice, the Federal Trade Commission and Congress are also conducting inquiries…

The investigation, which is joined by 48 states, the District of Columbia and Puerto Rico, “will focus on Google’s dominance in the telecommunications and search engine industries, as well as the potential harm caused to consumers and the economy from any anti-competitive conduct,” New York Attorney General Letitia James said in a statement. James leads the states’ investigation into Facebook.

Colorado Springs Gazette: Colorado Supreme Court rules in favor of Colorado Springs political committee’s campaign finance action

By Marianne Goodland

The Colorado Supreme Court on Monday overturned an appeals court decision on a campaign finance complaint filed against the Alliance for a Safe and Independent Woodmen Hills.

The 2014 complaint was filed by Campaign Integrity Watchdog (CIW) and its director, Matt Arnold, the state’s most prolific filer of campaign finance complaints…

The state Supreme Court’s ruling Monday looked at the plain language of Amendment 27, the voter-approved campaign finance law passed in 2002. The high court ruled that since CIW had filed its motion in El Paso County more than a year after the administrative law judge’s decision, the motion was outside the statute of limitations. The justices reinstated the requirement that CIW pay attorneys’ fees and costs…

“This particular horse was dead a very long time ago, but Mr. Arnold continues to beat it,” said Ryan Call, former head of the Colorado GOP and the registered agent for the Alliance. “If chilling political speech and discouraging activity in connection with a small local district election was his goal, he certainly accomplished that. I stopped trying to figure out what motivates him, but I expect it’s akin to why an arsonist sets fire to abandoned buildings.”

New York Law Journal: Group Sues NY Campaign Finance Commission Over Freedom of Information Law Compliance

By Dan M. Clark

A lawsuit filed Monday against a special commission created by the state Legislature in New York to develop a comprehensive public campaign finance system claimed the panel has not complied with the state’s Freedom of Information Law since it was formed in July.

The Government Justice Center was seeking, through the request, documents distributed at a recent meeting, and communications related to them.

The group, which bills itself as a nonprofit organization that sponsors litigation against the state, claimed in the lawsuit that its FOIL requests sent to Jay Jacobs, a member of the panel and chair of the State Democratic Party, have not been fulfilled.

In a seven-page petition filed Monday in Albany County Supreme Court, the Government Justice Center wrote that it had made the inquiry to Jacobs because the commission had yet to appoint someone to handle FOIL requests, as is required under law. Jacobs, according to the suit, responded that they were short-staffed but said the request would be fulfilled at some point.

Part of the reason the Government Justice Center made the request, according to the complaint, was because it appeared that some members of the commission hadn’t seen the documents, including an agenda, until the day of the meeting.

Cameron Macdonald, the group’s general counsel and executive director, said the lawsuit was filed to shine light on how the commission is operating.

“The public has a right to know what the Commission is up to, especially since the members are not accountable to voters like our elected officials are,” Macdonald said.

Macdonald also criticized the commission’s other open records practices, including that its initial meeting was livestreamed with poor quality on a mobile device.

Alex Baiocco

Alex Baiocco