A series of new lawsuits seek to upend decades of First Amendment jurisprudence affirming that campaign finance disclosure rules are both constitutional and important for our democracy.
Despite purporting to target specific provisions in Maryland, Massachusetts, and South Dakota state laws, the arguments asserted by the plaintiffs in each of the cases reveal an aggressive effort not only to gut those particular laws but also to fundamentally change the way courts review constitutional challenges to campaign finance disclosure requirements.
The strategy, if successful, would likely lead to further challenges to other disclosure provisions and to efforts by legislators to enact meaningful laws to address the problems of dark money and foreign interference in our elections.
Challenge to Maryland’s New Disclosure Rules for Online Platforms
In May 2018, a new transparency law took effect in Maryland. The Online Electioneering Transparency and Accountability Act (OETA) updates Maryland’s campaign disclosure rules to close loopholes that allowed online paid political advertising to go undisclosed. It also makes online platforms share responsibility for informing the public about the political advertisements those platforms disseminate.
Specifically, the law requires certain online platforms to post on their websites or retain in their records information about the sources, costs, and distribution of “qualified” paid political ads posted on their websites, as well as the candidate or ballot issues to which the ads relate. The OETA is an important tool to helping Maryland ensure that the public has quick and easy access to meaningful information about paid digital political ads seeking to influence their votes.
Ironically, while many newspapers have been demanding clear disclosures rules for digital political ads — and even adopting new mottos like “Democracy Dies in Darkness” — a number of newspapers that distribute paid political ads on their websites have sued to avoid their own obligations to comply with the OETA’s disclosure and recordkeeping requirements.
Beyond its sheer hypocrisy, the Maryland lawsuit is notable for its disregard of the “exacting scrutiny” standard that applies to campaign finance disclosure rules. Under that standard, the OETA’s disclosure requirements must be found constitutional as long as they are “substantially related” to Maryland’s important interests in informing the electorate and facilitating enforcement of other campaign finance rules including preventing foreign interference in U.S. electoral campaigns.
Perhaps recognizing that the law is substantially related to those very important interests, the plaintiffs are urging the court to apply a much more demanding “strict” standard of constitutional scrutiny, which requires a law to be “narrowly tailored” to advance a “compelling” government interest.
While courts have applied strict scrutiny to speech regulations outside the campaign-finance disclosure context, such as laws requiring Christian-affiliated pregnancy centers to display signs about abortion, or a law requiring a newspaper to print a candidate’s response to the newspaper’s editorial criticizing that candidate, courts have uniformly declined to apply strict scrutiny to rules requiring disclosure about paid political ads.
The plaintiffs are also urging the court to interpret Citizens United as permitting disclosure requirements only for those who pay for political ads, but not for those who receive such payments and distribute the ads to the public. Such an interpretation, in addition to being legally unsupported and fundamentally illogical, could make it harder for other states to require online platforms to disclose information about the billions of dollars in political ads disseminated on their websites.
Challenges to Massachusetts and South Dakota Political Disclosure Laws
Plaintiffs in two other recently filed lawsuits are employing a similar strategy of trying to bait courts into applying the wrong legal standard to review challenges to state campaign finance disclosure rules in Massachusetts and South Dakota.
In Massachusetts, a group called the Massachusetts Fiscal Alliance is challenging selected aspects of the state’s on-ad disclaimer requirements for paid “electioneering” ads that mention a candidate and are distributed in the months before an election. Despite the ostensibly narrow scope of its lawsuit — the Alliance is not challenging Massachusetts’s after-the-fact reporting requirements for its electioneering ads in this case — the Alliance, like the plaintiffs in Maryland, wrongly claims that the disclosure requirements it seeks to avoid must survive strict scrutiny.
And in South Dakota, a group called the Institute for Free Speech (IFS), which has consistently opposed campaign finance disclosure rules, is directly challenging the state’s disclosure requirements for “independent communication expenditures.” IFS claims that it should not have to disclose its top donors when it publishes analysis on its website of two South Dakota ballot measures, “with an emphasis on the ways in which those measures will impact citizens’ First Amendment rights.” Despite offering the limited concession that after-the-fact reporting requirements are subject to exacting scrutiny, IFS makes the same, wrong argument asserted in the Massachusetts case that on-ad disclaimer rules must satisfy strict scrutiny. Like the plaintiffs in Maryland and Massachusetts, IFS dismissed the Supreme Court’s clear holdings in Citizens United and other cases, while urging the South Dakota district court to rely on cases outside the election-related disclosure context to apply the wrong legal standard in reviewing South Dakota’s disclaimer rules.
So Far, Disclosure Continues to Prevail
Fortunately, the Massachusetts and South Dakota courts have already declined to take the plaintiffs’ “strict scrutiny” bait. In a preliminary decision issued on November 6, 2018, the Massachusetts district court refused to exempt the Alliance from Massachusetts’s disclaimer rules, recognized that the rules “neither erect a barrier to political speech nor limit its quantity,” and found the Alliance’s argument for strict scrutiny to be “unavailing.”
The South Dakota district court also issued a preliminary decision that suggested, albeit less conclusively, that “at least the ‘exacting scrutiny’ standard set forth in Buckley” would apply in a proper challenge to South Dakota’s disclosure rules. But the court ultimately declined to consider the constitutionally of those rules, because it construed them not to apply to IFS’s plan to post its own written analysis of certain ballot measures on its website.
The district court in Maryland has not yet issued any ruling on the challenge to Maryland’s disclosure rules. It will hear oral argument on the plaintiffs’ motion for a preliminary injunction on November 16, 2018. The court has invited CLC and Common Cause Maryland, who have filed an amicus brief in support of Maryland’s disclosure rules, to participate.
 Paul Farhi, The Washington Post’s New Slogan Turns Out to Be an Old Saying, Wash. Post (Feb. 24, 2017), https://wapo.st/2POEwVd (quoting statements by Bezos during an interview with Washington Post’s executive editor, Martin Baron).