HEARING UPDATE: Judge considers ruling on state campaign finance law

By Patsy R. Brumfield / Daily Journal

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ABERDEEN – Plaintiffs Vance Justice, Sharon Bynum, Matt Johnson, Allison Kinaman and Stan O’Dell of Lafayette County want the U.S. District Court to suspend a state campaign reporting law.

Essentially, they say they want to campaign for a Nov. 8 ballot initiative to change the state’s eminent domain law but that they are unnecessarily burdened from doing so by the campaign finance laws.

They say this is a “free speech” issue.

Mississippi’s campaign law requires registration and financial reports by any candidate or group involved with the political process once he/she or it raises or spend more than $200 in a year.

In the complaint filed Oct. 20, the group says the campaign finance laws “burden the rights of ordinary people to band together and speak effectively about proposed ballot measures” in Mississippi.

The complaint also objects to the state law’s requirement that they must disclose certain personal information – such as addresses, phone numbers and employers – to register as a political committee.

Defendants in the lawsuit are Secretary of State Delbert Hosemann, whose office administers campaign registration and elections, and Attorney Gen. Jim Hood, whose office enforces state laws.

Violation of the campaign finance laws are subject to a $50 per day fine, up to $500. Wilful violations are misdemeanors punishable by a fine of up to $3,000 and six months in prison, or both.

(Below is a rolling account of the hearing, scheduled to begin at 1:30 p.m. Please excuse the typos and other glitches likely to occur as I type as fast as I can.)

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Attorneys before Judge Aycock are: Harold Pizzetta and Reece Patridge, assistant attorneys general, and Russell Latino III with Wells Marble Attorneys at Law in Jackson and Paul Avelar with the Institute for Justice’s Arizona Chapter in Tempe.

1:37 – Aycock enters courtroom. She asks counsel to introduce themselves. They do.

Counselors you have provided excellent briefs. Want to give you opportunity to make your best case and point out the best law. Note cases you’ve cited. In other circuits. Would like to better understand 5th Circuit law, as well. I’ll have questions. Do not anticipate ruling today. Probaly take it under advisement. Relying in large measure about what you can Tell me today.

AVELAR – What is the case about. About a groupof friends and neighbors who want to talk to their friends and neighbors about Ballot Initiative 31. They want to buy newspaper ads, posters etc. What is it not about? Not about corruption. It cannot be. No anit-corruption issue. Supreme Court has said so. Affirmed in Citizens United and other cases. Therefore, any time state argumetns they are attempting to fight corruption, they are wrong.

It is about burdens on political speech. Supreme Court has already said regs like MS are burdensome. Registration, reporting and dislcousre create burdens on political speech and chill their activity. Those burdens can only be justified by an important interest. Here, base, to provide information about speakers. But Supreme Court has never accepted informational issues, such as ballot initiatives. Supreme Court has rejected information interests in ballot issues. What are we not talking aout? Not about large corporations and large amounts of funds. WE’re talking about a small group of friends and neibhbors.

If they argue about spending large sums of money, that has no application to my clients. Want to raise a small amount of money for speehc that’s uniquely protected. 9th Circuit case law is applicable. Not nec to rule in constitutionality of Mississippi laws, on their face. (He talks about a specific case, not applicable he says.) After Sampson case from 10th circuit, the Colorado secretary of state incrased the threshold to $5,000 to be considered a political committee. We;re not asking to go that far today. But in your power, to enter injunction to protect speech at a level at least as high as $1,000. Not much time to election so my clients could engage in advocacy. Thousand dollars won’t get them very far.

Notes, 1/4 page ad in paper costs $383. Couldn’t run more than 3 days ads to come under Mississippi’s law. Scare people away from being involved in politics. Even an unknowing violation can result in fines, up to $500.

For those reasons, plaintiffs are likely to succeed on merits of claims. For other elements, no harm to the defendants or state because no interest in enforcing an unconstitutional law. This is a case in which onoy regulation at issue are those about pure speech. Public interest furthered here by injunctive release. Public has interst in getting more informaiton from the plaintiffs about what they believe. Finally, no reason to deny relief because of theory of delay. Decision to speak is often made very late in the ballot. Has to be an option of immediate relef for speakers because they lose their right forever to speak in this election. Immediate relief is necessary to speak for this election.

Questions, your honor?

AYCOCK – I am curious, want you to understand that this is your area of special interest. I don’t. I am looking to you and your arguments to help me maneuver through this questions. But just as a matter of common sense, why waited until 19 days before election to file complaint?

AVELAR – We moved as quickly as we could. In this case, decision to speak wasn’t made until late. My clients aren’t an organization, like Farm Bureau. WE’re talking about a group of friends who had an interest to speak out. To say they had to make the decision earlier overlooks that decision. It could come late in the day when it comes to an election. Many people don’t start thinking about an election until the last couple of weeks.

AYCOCK – Have you participate in an election, that they don’t focus until late in the day. First approaching this from practical standpoint, then from theory about constitutional issues. But how effective can plaintiffs be in the last stage of a ballot initiative that is statewide, grassroots a few friends in a living room. How effective can one be?

AVELAR – Can be effective locally, maybe not statewide. By buying newspaper ads, costs $383. Impossible to buy a 1/4 page ad without being subject to these regulations. VEry possible to be effective in last couple of days when people are finally starting to pay attention.

AYCOCK – Why $1,000 instead of $200?

AVELAR – Don’t know it is arbitrary. $1,000 … what can they realistically do in a couple of days? Doesn’t make much sense to ask for $25,000 if my clients can’t reach it in a week. $1,000 they an reach, it’s practical. Other reason. 10th Circuit talked about speech at levels of less than $1,000. Said well we’re talking about speech taht’s less than $1,000 – certainly protected, no state interest. Take myu number from them. Burdens imposed on speech outweight whatever public interest could be in registration, public disclosure. $1,000 … to provide equitable relief.

AYCOCK – Any of your cases, has the court acted in equitable relief?

AVELAR – I believe … case out of Eastern Wisconsin, cited within our brief.

AYCOCK – No Supreme Court case… use informational interest, never been applied to a ballot initative?

AVELAR – Genesis, starts that people hav einterest in knowing who is contributing in candidates, will tell us how they will act in office. Supreme Court has never directly ruled on disclosure and registration requirements in ballot cases … are three addressed – first, expenditrue limits. Citizens in rent control – contribution limits. Third, out of Ohio, was about disclaimer requirements… this ad was paid for by. Supreme Court said the bare interest in proiding information about speaker wasn’t justified in burdens.

In another, maybe information interests apply in ballot issues but it’s never ruled so. Another court says no, doesn’t justify informational interests. Here we’re only talking about ballot initiative elections. McIntyre case most significant.

Again, this is an issue that Sampson court dealt with. Again, talking about an applied challenge from smally group of plaintiffs. If informational issue exists, the burdens that MS system put on small groups, can’t be applied. But that burden they impose on small speakers … whatever informational value it provides to voters shrinks from larger amounts to smaller amounts. The burdens regs impose simply outweight whatever benefits they might have, in theory. At that point, court should exercise its duty to protect fundamental rights.

AYCOCK – Summarize what you’ve said to me. Ballot initiative. burden on political speech. Informational interest hasn’t come from Supreme Court directly about this. Asking this court to treat this as applied constitutional question by raising the limit to these particular plaintiffs to $1,000 as soon as possible and essentially put three ads in the paper.

AVELAR – Essentially, two ads.

AYCOCK – But completing forms is too much? Why is this such a burden? How is that such a burdeN.

AVELAR – One form requires designating chair and treasurer. Treasure takes on burden of reporting by campaign finance law. Simple mistake can subject you to fines. Mistakes are pretty common, easy to make. State says if you make a mistake, you can wait to next report to correct. Another law says that for committees for ballot initiatives, you have only 10 days. Must be known. If Missisisppi doesn’t know, how can non-lawyers know about it?

AYCOCK – How frequently does this happen?

AVELAR – Don’t know. Statute says they can for non-compliance.

AYCOCK – Seems that you stressed in brief etc. that this is amll group of friends who want to meet and converse with others about this initiative. Scenario, innocent, modest, has such an insiginificant effect, relief could be granted. How do I know, what assurance can you give me if exception is made on this, how does that impact others who have less innocence of mission behind their work, other situations, other initiatives on the ballot Nov. 8?

AVELAR – Supreme Court says political speech highly protected. We’re asking for preliminary injunction applies only to plaintiffs so long as they stay below a certain limit. Other people who desire that relief must make their own case, after the election. Once we’re involved in the large litigation, can discuss more widely.

AYCOCK – Will continue this lawsuit, if the court grants relief to these plaintiffs?

AVELAR – Yes, lawsuit continues. Clients wnt to talk about ballot initiatves across elections. We will be litigating about whether larger issues apply, where’s the threshold to be hashed out in larger lawsuit. Relief now is very narrow. Only under $1,000 and for purposes of this election.

AYCOCK – Plaintiffs in courtroom? (Avelar – yes, three of them.)

STATE (PIZZETTA): 2:06 – to address two quick items:

$1,000 – is this insignificant? To me, assume that plaintiffs are acting rationally. Counsel says it’s insignificant. Rational to assume that they want to spend their own money because they believe they can influence other voters. Think it is a significant speech, that is protected uner the First Amendment. Not downplay the effectiveness. Reason why they want to spend money from their own pockets.

Second, $1,000 – a little taken aback, don’t recall it being raised before. My research.. don’t see any case that court re-wrote any statutes. Make sense. Don’t think a court has the authority to re-write a statute. It is all or nothing. These ase they cite, different systems, higher burdens – in those systems, the court did not re-write the statute, didn’t put itself in role of Legislature. Just said unconstitutional. Think $1,000 is a way to give court an out. Don’t think that’s an option for the court. If unconstituitonal, must be struck down and open to state adopting another.

In one case, deny or affirm preliminary injunction – one issue was to have a statute taken off the books in the waning days of an eleciton.

Important overview – The Supreme Court has given clear indications about how important htis typeof disclosure is. In our brief, Supreme Court looks at disclosure in candidates and ballot issues. Original Buckely v. Vallehos case, Supreme Court set out what it thinks is proper role of dislosure rules. Public disclosure to candidates and aprties may deter some, it is a burden. But that burden is greatly outweighed by benefits to society.

Supreme Court then more specific about ballot initiatives. Buckley 2 and another case, both were petition related cases. How important? Court struck down all these other aspects of regulations – limits on spending … more onerous restrictions. Because state’s compelling interest was satisfied by the disclosure requirements. It struck them down because of the efficacy and constitutional requirements. Protecting the election. Struck down more onerous restrictions because integrity of system protected by disclosure.

Most recent case about disclosure on ballot initiatives, restriction requires petition signers are kept from public view. Supreme Court upheld that type of disclosure – that when you sign petition, government can make that signature public. It’s a type of disclosure requirement.

Last one, Citizens United – a candidate case, not ballot. But Supreme Court tracks same language – struck down provision that corps must form a PAC to speak. Why? Wasn’t because of the PAC was too burdensome but that corporations can speak directly and can’t be forced to set up a PAC. Upheld the disclosure requirements.

In grand scheme, can’t honestly say government doesn’t have an interest in disclosure. Supreme Court has ennunciated. Cases out of 1st, 9th Circuits and district courts had same premise. Disclosure in ballot initiatve case are constitutional.

Most important for ballot intiatives is the informational apsect. That individuals can fully evaluate the importance of speech. Major component is to know who is speaking. One, with respect to ballot initiatves, … very complex questions. 31, on its face, it’s complex – about eminent domain. If look at the text, it’s 186 words long. Talks about various concepts. We all know a lot to focus on on a ballot. Important to know who is speaking for an issue or against it. To know who’s going to gain from it. More important in ballot initiative cases, this is an amendment to the constitution, voters are acting as legislators making important decisions.

Exceptionally important, the district and 1st circuit said that when you come to court on the eve or an election … filing late, this was an emergency of the plaintiffs own making. While I would never begrudge an individual who wants to file a lawsuit, but if you wait to last minute, you may be giving up certain rights. These initiatives have been set for the ballot since october of last year.

These plaintiffs are astute. They knew for quite a while about them. Decided later on about their speech. But if you wait too long, certain things are foreclosed to you. $1,000 issue. Had this been filed last year, this court might have decided and Legislature could have had time to act to put something in place.

To crystalize the public interest. When look at $200 threshold, we have to establish relationship between disclosure and government interest. Substantial relationship. Two things, to think about exact scrutiny versus strict scrutiny…. that $200 was narrowly payable, it’s substantially related. Plaintiffs asking you to find that this isn’t the highest threshold to achieve. Supreme Court says that’s not the standard.

Best analysis of this in our brief, where Supreme Court in Buffett talked about how a threshold requirement standard has been set appropriately. It said we cannot require Congress to estalbish that it has chosen the highest reasonable threashold, instead, because i’s a legislative determination, is the $200 wholly irrational in respect to the government? That’s where (three courts) go awry, do they ever talk about that legislative deference. They say, rejects argument that $zero was per se unconstitutional. First Circuit said no, struck it down for difference requirements for candidates and committees. Not like Mississippi, we’re $200 for both.

Other part, take solace is trying to find out relationships, what have other states done? Undoubtedly others with higher thresholds. But others lower than Mississippi. So important to show, Mississippi’s judgment is in line with others. When you look at others, like Massachusetts, Oregon etc. all have lower thresholds. Mississippi on firm footing.

Important thing, states have differing requirements. But the cases we think are more on point, the actual requirements they were looking at. Two decisions agree with Wisconsin statute, struck down amounts but said requirements went so much farther than disclosure. One actually took money away from contributions if they went over such an amount. Other strict, signifiant restrictions. Those court said these were significant burdens that don’t hae anything to do with 1st Amendments.

Why disclosure is important in ballot initiatives. Our cites talk about, struck me that courts were approving thresholds lower than Mississippi, to require registration, disclosure. That was constitutional. Courts don’t second guess amounts, that’s for the legislature. Mississippi’s threshold requirements are some of the highest, can’t say it’s not totally rational.

Of course, case will continue on. Complaint, I don’t think court has enough information for a preliminary injunction. There’s a dirth of specificity about what they want to do.

2:36 – Pizzette closes.

AYCOCK – In summary, public interest in this case, informational. You take position that plaintiffs desire equitable relief to raise threshold to $1,000. You say court does not have authority to do so. Burden on speeh is outweighed by the public interest. Least restructie means to give public understanding in ballot issues who’s behind the effort before elections. Who is trying to persuade the issue may affect how voter casts ballot. You believe that sometimes it is too late to ask for relief before an election. Bottom line- I must focus on $200 as in line, Legislature hasn’t had opportunity to look at it. Unless court finds $200 to be irrational, the amount should be left to the Legislature.

PIZZETTA – Wish I’d said it that succinctly.

AYCOCK – Avelar, let me think through government’s argument. How does it affect you, if court makes no decision by election day?

PIZZETTA – From our perspective, would maintain the status quo – generaly what an injunction is for. Danger, if court grants it with election just a couple of days away, it’s full and final for this cycle To grant relief that can never be undone. Why waiting so late..

AVELAR – If no decision, my clients won’t go over $200 and will not be able to buy ad in paper.

AYCOCK – Pizzetta, does it impact other ballot issues in other ways?

PIZZETTA – If court strikes it down, chance of other quick-file litigation, questions of what happens elsewhere. What will be the public perception? What is the confusion created by that? How affects others who have contributed? How do we enforce it, if limits are struck down. Others out there obeying the law. Can’t contain it if say statute is unconstituitonal.

AVELAR – Our position is that court should apploy strict scrutiny. Realize Supreme Court hasn’t been perfectly consistent. For present purposes, plaintiffs assert entitled to relief even under exacting scrutiny as set forth … that state must show important governmental interest.

AYCOCK – Do you agree with premise that threshold amount is left to Legislature unless cout finds it to be wholly irrational?

AVELAR – No. We’re talking about that regulation in Mississippi imposes burdens, at a minimum some level those burdens outweigh whatever purported benefit there is. Knowing who is spending $200. More than that, Supreme Court has dealt with questions of levels in a case, people in Vt. challenged low contribution levels at $200. State said to defer to Legislature. Court said, must recognize existence of some lower bounds. Too low can be burdensome.

PIZZETTA – That was a contribution limit. What happened with Citizens United.

AYCOCK – Plaintiffs are not barred from speaking, just must fill out forms.

AVELAR – Not barred, just chilled. Can’t be forced to form a PAC to speak. That’s what Mississippi does.

AYCOCK – It doesn’t preclude but must form a PAC?

AVELAR – Real danger because laws create confusion to allow people to speak. Shouldn’t have to hire an attorney to form a PAC.

PIZZETTA – Citiznes United, forming a PAC – it’s important. We’re not forcing anybody to form a committee. Just if you voluntarily choose to form a group. We say once you form a group. you have to register. Different from Citizens United, recognizes that corporation has a right to speak directly, not have to form a PAC. Disclosure requirements bring contributions to light. Doesn’t strike down disclosure or reporting requirements. But once you form a group. you have to say “We are this group.”

AYCOCK – Idea of disclousre requirements, do you agree with government as constitutiona?

AVELAR – Depends on circumstances. Takes back to candidates versus ballot issues. In candidates, disclosure is generally upheld. To ballot issues, given recent cases that there is the trend to recognize that Supreme Court says there are burdens and when start weighing burdens, at low levels they are unconstitutional.

AYCOCK – You’re looking at (notes cases).

AVELAR – Say Sampson is really the case that wrestles with issues most thoroughly.

AYCOCK – Do you follow these case in other states?

AVELAR – Institute filed Sampson case.

AYCOCK – Avelar, other comments?

AVELAR – Just want to clarify that there is a facial and an applied challenge here. If court willing to issue an injunction, plantiffs happy. But if recognize strong likelihood with applied challenge, ask for narrow constrained relief. One other thing, state said these laws are applicable issues are lengthy and complicated. State’s finance laws are far more complicated than Initiative 31’s wording. Those regulations are difficult to understand with potential civil and criminal penalties – chilling effect on speech.

2:59 – AYCOCK – Know you want a decision as soon as possible, but not today. This has been very helpful to me. VEry candidly, before I read these cases, I probably fall into the category of other citizens would perceive that I must fill out forms for $200. I hae come to appreciate through case law that there is justifiable government interests in disclosure. What I’m struggling with are the burdens – when is it mine, when do I hve the authority, for TRO versus facial challenges to laws themselves. On its face, amount struck me as very low. Recognize court has duties and legislature has. Not my duty to set the threshold or amount. Need to look at other states, law that’s addressed these similarly, low thresholds. I an appreciate that as citizens and decide to buy an ad, detrmine that cost is going to require me to fill out a series of documents, at first blush I understand it’s a burden and chilling effect.

Under some circumstances, could discourage me enough not to participate in the process. I understand it from practical application of facts, but then it appears there are several courts in several circuits, that have dealt with this issues – in most instances, on side of disclousre as constitutional under some circumstances, unless amount is wholly irrational it’s the Legislature’s job, not mine.

Will look at these three cases relied heavily upon by plaintiffs. Particularly Sampson. See if these facts differ from Mississippi. Will issue opinion as quickly as possible.

3:04 p.m. – ENDS

(ORIGINAL POST)

ABERDEEN – U.S. District Judge Sharion Aycock will hear arguments today about Mississippi’s law on campaign finance reporting.

The federal hearing is scheduled to begin at 1:30 in Aberdeen.

Aycock is responding to a group’s complaint that its members ought to be able to raise money and spend it in support of a Nov. 8 ballot initiative without jumping through all the legal hoops required by state law.

Today, the group – five citizens from Lafayette County and a civil liberties law firm – will ask her to temporarily suspend the law as it applies to them and to halt its application.

They want to campaign on behalf of Initiative 31, which seeks to change the state’s laws about eminent domain.

Mississippi law requires that any candidate or group, which works within the political process, must file spending reports once he/she or it collects or spends more than $200 in a year.

• For more details, come back to NEMS360.com.