Federal appeals court sides with Vermont in campaign finance case


MONTPELIER -- The U.S. Court of Appeals for the Second Circuit ruled for Vermont in a case seeking to overturn aspects of the state's campaign finance laws.

The Vermont Right to Life Committee challenged the constitutionality of Vermont's campaign finance reporting, disclosure requirements and the state's limit on contributions to an affiliated independent expenditure group.

The group sought to overturn state requirements that PACs report mass media spending and identify sponsors of political speech. The lawsuit also questioned the state's definition of a PAC. The Vermont Right to Life Committee is a nonprofit corporation and its political action committee supports anti-abortion candidates.

The Second Circuit upheld a 2012 district court decision rejecting the Vermont Right to Life Committee's arguments.

The decision is a validation of Vermont's campaign finance laws, according to Eve Jacobs-Carnahan who argued the case for the Vermont Attorney General's Office.

It's also the latest chapter in a national tug-of-war over how campaign finance should be regulated, said Cheryl Hannah, a constitutional law expert at Vermont Law School.

James Bopp Jr., an attorney for the Vermont Right to Life Committee, said he plans to appeal the decision to the Supreme Court.

Bopp did not say if he would appeal all or part of the decision. If the Supreme Court decides to hear the case, it could rule narrowly on aspects of the lawsuit.

An appeal must be filed within 90 days of the July 2 ruling.

Bopp is counsel for the National Right to Life Committee and a prominent conservative lawyer who has brought many of the challenges to campaign-finance regulations nationally.

In its ruling, the Second Circuit relied on the Supreme Court Citizens United v. Federal Election Commission decision, which holds that limitations on election spending hampers free speech. The ruling, however, permits laws that require disclosure because "the public has an interest in knowing who is speaking about a candidate shortly before an election."

The Second Circuit "ignored the part they didn't like" in the Citizen's United decision, which delineates between different kinds of disclosure, Bopp said. In his view, Vermont's rules go beyond what the Supreme Court intended.

Attorney General Bill Sorrell said it's going to be "uphill sledding" for Bopp if he wants to argue that the Vermont Right to Life Committee is allowed to operate with less transparency than allowed by state law.

But Bopp said the case is "ripe" for consideration by the Supreme Court because there is wide divergence in similar circuit court rulings, and the Supreme Court hasn't clearly defined how political groups can relate to each other.

Part of the Vermont Right to Life Committee case relies on the complex makeup of the group and the affiliated Vermont Right to Life Committee Fund for Independent Political Expenditures and a third affiliated group that is not a plaintiff, the Vermont Right to Life Committee Political Committee.

Based on how the three groups are legally structured, the Vermont Right to Life Committee should not be considered a political action committee because the majority of its activities are not political, according to lawsuit. Lawyers argued that the Vermont Right to Life Committee Fund for Independent Political Expenditures should not be subject to contribution limits, because the organization is distinct from the Vermont Right to Life Committee Political Committee.

Organizations not affiliated with candidates or PACs can make unlimited independent expenditures (ads and mailings) on behalf of a candidate. The groups are not allowed to coordinate these activities with candidates. The Supreme Court has ruled it is unconstitutional to limit independent expenditures.

But the Second Circuit and district court rulings found that the Vermont Right to Life Committee Fund for Independent Political Expenditures' activities were "enmeshed financially and organizationally" with the Vermont Right to Life Committee Political Committee and therefore aren't independent.

That separates this case from other circuit court decisions, Sorrell said. The Second Circuit's ruling on that portion of the case is based on a set of facts about the day-to-day operation of two organizations, whereas other similar circuit court rulings he said are "straight constitutional challenges."

The Vermont Right to Life Committee case probes the limits of campaign-finance regulations, said Hannah, the VLS constitutional law expert.

The Supreme Court has ruled that government's only interest in regulating campaign finance should be preventing direct quid pro quo spending to influence elections, she said.

For instance, the Supreme Court struck down Vermont's limits on direct contributions to political candidates in its 2006 ruling in Randall v. Sorrell.

Disclosure rules are seen by some as an "antidote" to the money in politics, because it allows the public to consider the source, Hannah said.

Members of Congress have tried to pass a federal disclosure act in 2010 and 2012 without success, and are expected to try again this year.


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