Traverse City Record-Eagle

January 21, 2010

12:05 pm: Court ruling won't halt Meijer probe

By BILL O'BRIEN

TRAVERSE CITY — A U.S. Supreme Court's decision to lift caps on corporate political spending in federal elections could limit — but not cripple — a criminal probe in Grand Traverse County.

Grand Traverse Prosecutor Alan Schneider said the Supreme Court's decision today will impact his office's ability to proceed with a criminal case against Meijer and others involved in 2005 and 2007 elections in Acme Township.

The court's decision overturns Section 54 of the Michigan Campaign Finance Act that prohibits corporate funding of candidate campaigns, he said. That decision applies to a 2007 recall election in Acme Township in which Meijer illegally funneled tens of thousands of dollars to groups to try to depose the township board.

Violations of Section 54 were a felony under state law, and would have allowed prosecutors to utilize investigative subpoenas to compel testimony from unwilling witnesses. Now, Schneider said his office won't be able to utilize investigative subpoenas to probe Meijer's corporate donations.

But Schneider said he could pursue up to 25 other criminal violations that are spelled out in state campaign finance laws. Meijer currently is appealing a Michigan Court of Appeals ruling that allowed Schneider's office to continue the Acme probe.

"The decision of the U.S. Supreme Court does not in any way render that appeal moot," Schneider said.

The nation's top court threw out the 63-year-old law that was designed to restrain the influence of big business and unions on elections. They ruled that corporations may spend as freely as they like to support or oppose candidates for president and Congress.

The decision could drastically alter who gives and gets hundreds of millions of dollars in this year's crucial midterm elections.

By a 5-4 vote, the court overturned two of its own decisions as well as the decades-old law that said companies and labor unions can be prohibited from using money from their general treasuries to produce and run their own campaign ads. The decision threatens similar limits imposed by 24 states.

It leaves in place a prohibition on direct contributions to candidates from corporations and unions.

Critics of the stricter limits have argued that they amount to an unconstitutional restraint of free speech, and the court majority agreed.

"The censorship we now confront is vast in its reach," Justice Anthony Kennedy said in his majority opinion, joined by his four more conservative colleagues.

Strongly disagreeing, Justice John Paul Stevens said in his dissent, "The court's ruling threatens to undermine the integrity of elected institutions around the nation."

Justices Ruth Bader Ginsburg, Stephen Breyer and Sonia Sotomayor joined Stevens' dissent, parts of which he read aloud in the courtroom.

The justices also struck down part of the landmark McCain-Feingold campaign finance bill that barred union- and corporate-paid issue ads in the closing days of election campaigns.

Advocates of strong campaign finance regulations have predicted that a court ruling against the limits would lead to a flood of corporate and union money in federal campaigns as early as this year's midterm congressional elections.

"It's the Super Bowl of bad decisions," said Common Cause president Bob Edgar, a former congressman from Pennsylvania.

The opinion goes to the heart of laws dating back to the Gilded Age when Congress passed the Tillman Act in 1907 banning corporations from donating money directly to federal candidates. Though that prohibition still stands, the same can't be said for much of the century-long effort that followed to separate politics from corporate money.

The decision's most immediate effect is to permit corporate and union-sponsored political ads to run right up to the moment of an election, and to allow them to call for the election or defeat of a candidate. In presidential elections and in highly contested congressional contests, that could mean a dramatic increase in television advertising competing for time and public attention.

In the long term, corporations, their industry associations and labor unions are free to tap their treasuries to assist candidates, although the spending may not be coordinated with the candidates.

"It's going to be the Wild Wild West," said Ben Ginsberg, a Republican attorney who has represented several GOP presidential campaigns. "If corporations and unions can give unlimited amounts ... it means that the public debate is significantly changed with a lot more voices and it means that the loudest voices are going to be corporations and unions."

The case does not affect political action committees, which mushroomed after post-Watergate laws set the first limits on contributions by individuals to candidates. Corporations, unions and others may create PACs to contribute directly to candidates, but they must be funded with voluntary contributions from employees, members and other individuals, not by corporate or union treasuries.

Chief Justice John Roberts and Justices Samuel Alito, Antonin Scalia and Clarence Thomas joined Kennedy to form the majority in the main part of the case.

Roberts, in a separate opinion, said that upholding the limits would have restrained "the vibrant public discourse that is at the foundation of our democracy."

Stevens complained that those justices overreached by throwing out earlier Supreme Court decisions that had not been at issue when this case first came to the court.

"Essentially, five justices were unhappy with the limited nature of the case before us, so they changed the case to give themselves an opportunity to change the law," Stevens said.

The case began when a conservative group, Citizens United, made a 90-minute movie that was very critical of Hillary Rodham Clinton as she sought the Democratic presidential nomination. Citizens United wanted to air ads for the anti-Clinton movie and distribute it through video-on-demand services on local cable systems during the 2008 Democratic primary campaign.

But federal courts said the movie looked and sounded like a long campaign ad, and therefore should be regulated like one.

The movie was advertised on the Internet, sold on DVD and shown in a few theaters. Campaign regulations do not apply to DVDs, theaters or the Internet.

The court first heard arguments in March, then asked for another round of arguments about whether corporations and unions should be treated differently from individuals when it comes to campaign spending.

The justices convened in a special argument session in September, Sotomayor's first. The conservative justices gave every indication then that they were prepared to take the steps they did on Thursday.

The justices, with only Thomas in dissent, did uphold McCain-Feingold requirements that anyone spending money on political ads must disclose the names of contributors.

———

The Associated Press contributed to this report.