Wednesday, February 03, 2010

Senate Judiciary on Citizens United v. FEC

[Picture:  John Ptacin (left) and Alpheus Bullard, before the meeting]

Senate Judiciary Committee
Thomas Stewart Building -  Beltz 105
1:30 pm

Meeting started promptly at 1:30pm.  [I took notes directly on the laptop today. Not sure posting this so raw is a good idea. Read this with the CAUTION that these are my notes as I listened and I couldn't always hear or keep up.  Sometimes I had to end sentences best as I could.  Question marks sometimes mean I wasn't sure what was said.]

 You shouldn't attribute anything written here to anyone.  Consider this as a way to get a sense of the discussion.  After this, I'll try to post what I think were the key points.

Tom Dosik [Did not attend had  death in family] and John Ptacin, Alaska Department of Law

Kathryn Kurtz and Alpheus Bullard
Legislative Legal Services

Bullard:  First Amendment Case deals with political speech by corporations.  Not about contributions.  Only dealing with independent expenditures by corps.  Previously, a great deal depended on who the speaker was.  Significant in this case that SC has ruled that a Speaker's corporate identity is not longer an allowable distinction.

Upheld various disclosure provisions.  Rationale struck down ability to suppress speech on the basis of the speaker's corporate identity, this bears on our own laws.  Those statutes are not repealed, they are void. 

Ptacin, Dept. of Law, and I represent APOC.
What laws are not affected:  independent contributions to a candidate are not affected.  Corps and Unions inability to make direct contributions is unaffected.  Didn't interpret Alaska law, but it is affected.  States in this area, do not have greater lattitude than congress to abridge the freedom of speech.

Essentially, it did overturn one aspect - ban on any corp or labor union contribution to independent expenditures leading up to elections.  Not about candidate contributions.  Defined first amendment rights of corps.  Court ruled not reason to cut down freedom of speech rights of corps.  Court is looking at specific expression and not who is making the expression.  In this case making a communication electioneering speech is political speech and that's a high level right???   Govt. tried to make three arguments:  1.  Anti distortion of great wealth that has corrosive and distorting impact on the message.  No longer an argument.  2.  Anti-corruption argument and court didn't agree on this either.  3.  Shareholder protection - shareholders powerless to stop the spending of the money.  Also down.   Without a compelling reason to curtail speech the government's case turned down.

Affects Alaska law, preparing things internally now.

1:44 pm

Kathryn Kurz

Chair Hollis French:  Which state laws are now void?
Ptacin:  15.13.067A & 15.13.135  Disallow Corps and Labor Unions from making independent expenditures.  Are expenditures alwasy political speech.  Some definitions include political speech, some not.  Determining extent to which there are probls with current statutes.

Did we have same limitations as feds?
Ptacin:  Our law contemplates a ban on all independent expenditures.  Not exactly the same as Feds.  Trying to determine.

French:  We've gone from total ban to what is now a total free for all?
Ptacin:  I look at disclosure and I look at indpendent expenditure.

 [Left to right on the panel:  Sen. John Coghill; Sen. Bill Wielechowski; Chair Sen. Hollis French; Sen. Dennis Egan;  Sen. Lesil McGuire.  The three attorneys - Kathryn Kurtz, Alpheus Bullard, and John Ptacin - are seated at the table in front.]

Bullard:  Allow some corps under Alaska law to make expenditures - non-profits, so not all corps.  Window opened is not as large...

French:  Any corp doing business in Alaska is free to spend money for or against ....

Bullard:  Hard to anticipate how things will be interpreted by our courts.

French:  Will it take a specific legal action by a corp or do you deem it void by virtue of Citizens United.

Bullard:  When one of our laws is challenged, the court will look, whether the Dept. of Law attempts to enforce....??  Left up to Attorney General to enforce.
Ptacin:  We acknowledge the law us subject to scrutiny.  An opinion on that point is probably coming.
French:  Our opportunity to pass laws is limited to the session.  Timing?
Ptacin:  We've been working on this since the fall.  Attorney General hasn't been asked for an opinion.  Can't speculate when forthcoming.
Wielechowski:  It seems corps exist because the state allows them to.
?:  Corps are a legal fiction.
W:  Could not the state impose restrictions
Bullard:  Lot of kinds of corporations, difficult.
W:  SC said Corps are entitled to free speech, but corps don't exist unless states allow them correct?
Kurtz:  There is something that talks to this:  any corp formed by....  I think the main thing is that the USSC just defined a right to speech for corps in this area and I don't think the State of Alaska can overturn that.
W:  Does the state have to allow corps to exist?
K:  The consequences of that declaration would be lively and interesting.
W:  If a corp exists and had majority of foreign stockholders, would that corp be able to influence elections?
K:  Was addressed by the court - this decision doesn't distinguish between foreign and US corps.
W:  Could the another govt. set up a corp in Alaska and try to influence the law?
K:  Not an expert in corp law, not comfortable answering.
Ptacin:  CU didn't invalidate the law that prohibits foreign corps from speech in candidate elections.  We still need to study and give guidance to the state.  We have to consider do we want to distinguish between foreign and state corps?
Coghill: Breaks a veil ?
Ptacin:  CU (Citizens United) took issue with the PAC /Corp distinction and breaks that down.
Coghill:  Still accountability on how to speak?
Ptacin:  Correct.  Still taking a close look.
Coghill:  Laws still more restrictive than individual and we don't want them to be less restrictive.
Ptacin:  Disclosure laws - look at persons.  Some laws apply to labor unions, some not.
Egan:  I'm not an attorney at all.  Follow up Coghill.
What kind of corps in Alaska can contribute?  527s ok, but.
Ptacin:  Didn't determine that corps can make contributions to candidate directly.
Egan:  Do you expect litigation?
Ptacin:  Hard to say.  I do represent APOC.  No current litigation.
Egan:  Is APOC staff looking at this independently from DoL?
Ptacin:  I work closely with APOC, any advice to AG after talking to apoc.
McGuire:  If we don't enact a law dealing with disclosure expenditures etc. for for-proft corps, we could face an election where for-profts are out there in the dark spending whatever amount of money without disclosing what they are doing?  I don't see anything that prevents disclosure?  If we do anything, we should at least look at disclosure?
Ptacin:  This area does require action by legislature - which disclosures apply to corps.  Which apply to persons and which not.  040.  Labor Unions required to report - D and E.
French:  Every individual, person, non-entity, and group.  You are putting corps under person?  Not individual?
Ptacin:  Correct.
French:  You brought up, Sen McGuire, the one bulwark against this decision - disclosure.
Bullard:  040 J.
French:  take non-group entity out - you're saying it's a non-profit.  Disclosures required electronically or on paper?
I think that would be reported on APOC form, on paper.
French:  I can imagine we'll be looking at quicker disclosure.  They are well healed, great capacity to amass wealth and should disclose as quickly as possible.  Shouldn't put burdent on APOC staff to scan disclosures.
Coghill:  We've set about to do that, work in progress, have not been able to do that.  Heading in that direction.
French:  I think you mean disclosures made by candidates?
I think corps are uniquely able to use the internet.
Kurtz:  Refert to XXXX?  clarifies something.
French:  Leaning towards disclosure.

Covered many of the questions I submitted to you. I guess.
One more Q:  APOC, concern that disclosre for each individual ads - so viewers understand source of the money.  If a group of corps forms "Americans for Jobs"  Is there anything that would prohibit requiring disclosure of specific contributors.
Ptacin:  Law xxx currently bars contributions that aren't ballot measure groups, that merits scruity, but there is a statue that deals with that.  Only spoke about its own entity.  Pure speech from its own pocket.
French:  Concern, any corp can now advocate for .... CU dealt with single entity.  I don't see court limited by that in future case where they form a new corp together to hide the source of the funds used to electioneer.  We want citizens to know who the corps are.
Ptacin:  I think we hae to atake aim and disclaimer and disclosure law.  Spending money from own corp treasury.  CU touched on this ...
W:  If and what we can do about corps.  We allow them to exist.  What kind of limits can we place on them?
Ptacin:  Disclaimer and disclosure laws constitutional.  Laws contemplated in CU are similar to those Alaska imposes.  And foreign corp issue also has federal laws.  It didn't rule on disclosure, just the actual expenditure.
W:  Could we pass a law to say we would not allow corps with foreign majority to campaign?
Ptacin:  We have to look at it.
Kurtz:  Existing statute 13..... does have some of the things you're talking about  135 - we have some of those requirements, but they don't apply to corps because we didn't anticipate corps making expenditure.  We can change those to apply to corps.
French:  So we can now write in the word person on that list.
Kurtz:  Don't know if it would b3 that simple.  We need to be circumspect.
[I'm adding in a bit of video that wasn't ready earlier and fits here I believe]

Kurtz:  You could get a challenge there or the Legislature could pro-actively enact legislation in anticipation.
W:  Our situation now is that corps have more rights and freedom than individuals under Alaska law?
Kurtz:  Not sure.
Bullard:  It's possible you could characterize the situation that way.  It's hard to know how it will be interpreted by the court.
Coghill:  We need to clarify that they dont have more than any individual, though they may be able to speak with a louder voice, but that's been happening anyway in a different venue.  Need to make sure that if they speak, we know who is speaking and the cost of that speech, so they are accountable like every other individual.  If they have the right to speak, which I tend to agree with, then I want to make sure they meet the requirements that others have to comply with.
W:  As I see this, Corps have more rights than people.
2:30  Brief at ease.

2:30 back
McGuire:  Roe v. Wade analogy, we don't know how other states respond, it makes sense to start with non-profit, but is there any place for $ threshold?  Time line makes it difficult.
Kurtz:  That was back in other decision.  Contribution limits, but not expenditure limits.
Coghill:  Thanks for bringing this up so we can discuss this.  F of Speech dear to us all and you can see the tension.  We can't say they can't spend their wealth to speak any way they want.
W:  Courts ruled and probably the worst decision in my lifetime, but it is what it is and I'm concerned that foreign comapnies and shareholders are not allowed to influence elections in Alaska.
Coghill:  We've already be subject to that in many ways through the PAC law.  Not sure we can do that, I'd be willing to look into it.
French:  read two selections from Stevens:  The interests of non resident corporations not in the interest of local citizens.     At bottom the courts opinion is thus a rejection of the common sense of the people . . . strange time to repudiate that common sense.  While the US democracy is imperfect, few would .
[Here, I think, are the quotes from the Stevens dissenting opinion:
"the interests of nonresident corporations may be fundamentally adverse to the interests of local voters. Consequently, when corporations grab up the prime broadcasting slots on the eve of an election, they can flood the market with advocacy that bears “little or no correlation” to the ideas of natural persons or to any broader notion of the public good, 494 U. S., at 660. The opinions of real people may be marginalized."

"At bottom, the Court’s opinion is thus a rejection of the common sense of the American people, who have recognized a need to prevent corporations from undermining self-government since the founding, and who have fought against the distinctive corrupting potential of corporate electioneering since the days of Theodore Roosevelt. It is a strange time to repudiate that common sense. While American democracy is imperfect, few outside the majority of this Court would have thought its flaws included a dearth of corporate money in politics."]


  1. We can't over-estimate the kind of coverage you're performing down there this session, Steve. This transcript is a case in point.

  2. In the moment, with flying fingered Steve. Good to see this.

    I am additionally interested as to what happens regarding non-profit corporations and IRS tax code restrictions of their (as persons) free speech. Did the decision restrict its reach to for-profit corporations, and if so, how was this reasoned given it was based on first amendment extension of personhood rights to corporations? It would seem that this allow religious organizations (and all nps) to become political agents even given our legal pledge to abjure 'political electioneering'.

    I raise these issues as Out North was drawn into a superior court case in the early 1990s (Pomo Afro Homos) and our attorney advised that our 'commercial speech' (advertising on city busses) was not held to the same protection standards. What will happen to this area of interpretation given Citizens United? Can there still be consumer regulations concerning advertising if corporations are granted 'free speech' standards for their message content? or does this fall under the more ancient form of slander protections?

    I will probably break down and read the decision after all.

  3. Let me guess, that incompetent KTUU reporter in the above photo is asking French to s-p-e-l-l his n-a-m-e and g-i-v-e his t-i-t-l-e for the

  4. Phil, thanks for the encouragement, but I would point out that Gavel to Gavel allows you to hear (in this case see too) every word.

    Jay, non-profits were mentioned but I don't know the answer to your question. However, it was said that the court distinguished political speech as the most important, if I heard right, so I'd guess the bus ads would be considered commercial and not as protected.

    Anon, I realize this is meant as a joke and I didn't hear the interview, and I didn't get to hear their report. However, I have not the slightest evidence that they are incompetent, they've been supportive to me and I want to have a good working relationship with them, so please - in your comments here at least - cut the snark against the other news gatherers. I'd direct problems you might have with what they do to the people who hire them and direct them.


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