[EL] Tea Party Leadership Fund will not be alone

[BZall at aol.com]

Just to be clear, the rationale for the sort of compelled government speech 
 and disclosure at issue here is based in anti-consumer protection, not 
theories  about election-related disclosures. That is a different part of the 
First  Amendment doctrine, because there is thought to be an important 
governmental  interest in protecting vulnerable residents from fraud related to 
fundraising. 
 
The extension of such theories to political activities, as in recent New  
York legislation, rests on a completely different First Amendment 
calculation,  and recent Supreme Court decisions (such as the much-maligned  
McCutcheon) reflect only a single governmental interest powerful enough  to justify 
governmental compulsion to speak/disclose: corruption or the  appearance of 
corruption. 
 
The really interesting part of the CCP case is in its application of the  
preemption doctrines (express, field and conflict) to the state's rationale 
for  requesting the information for anti-fraud purposes. Just as the Supreme 
Court  has moved to limit federal and state actions to limit political 
speech, it has  also limited the ability of states to enact laws that either 
conflict with  federal law or enter into a space that the federal government has 
fully  occupied, leaving no room for state-level regulation. See, e.g., 
Sprietsma v.  Mercury Marine, 537 U.S. 51 (2002)(state common law on liability 
for  propeller guard defects not preempted by rules for watercraft propeller 
 design from the federal agencies). The most recent example familiar to 
this list  is the EAC cases, Arizona and Kobach, where the Supremes said that 
states could  not require more on a federal voter registration form than the 
federal agency  permitted, but could sue the agency to force it to respect 
constitutional  limitations on its own power. But that was only one of a 
recent spate of Supreme  Court cases on preemption, including several involving 
state immigration-related  laws. See, e.g., Chamber of Commerce v. Whiting, 
No. 09-115, (2011) (Arizona  state licensing power not preempted by 
comprehensive federal scheme to limit  verification of aliens' ability to accept 
employment); Arizona v. U.S., No.  11-182 (2012)(Arizona statutes on unlawful 
presence largely preempted by  comprehensive federal scheme regulating 
aliens' residence in the U.S.). 
 
The preemption issues in CCP are whether Congress has occupied  the field 
by expressly providing only a single method and highly-restrictive  procedure 
for sharing federal forms with state agencies, or whether the  California 
requirement for an unredacted 990 Schedule B list of donors makes the  
express Congressional intention to protect taxpayer information impossible to  
achieve (note this latter point well if you think requiring donor  disclosure 
in the tax context is easy). This is either field preemption or  conflict 
preemption of a fairly-plain vanilla form, and an issue easily handled  by most 
federal courts. This is a recent change in federal law, and the  California 
defense relies on outdated cases handed down before that legal  change. 
 
The key question, as always in a preemption case, is what Congress  
intended, not what the agency did, and there are likely differing views on that,  
but the lengthy series of restrictions Congress imposed on the sharing of 990 
 Schedule B lists of donors both on the agency and on states who receive 
that  information from the IRS is a pretty good indication that Congress wants 
that  information protected. The question is whether the judge will see 
California's  requirement as an evasion of those restrictions; California 
cannot do indirectly  what it is not permitted to do directly. And California's 
sole defense is that  it tries to keep that information confidential; that 
may not be enough. 

Barnaby Zall 
Of Counsel 
Weinberg, Jacobs & Tolani,  LLP 
10411 Motor City Drive, Suite 500
Bethesda, MD 20817
301-231-6943  (direct dial) 
bzall at aol.com  
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In a message dated 4/17/2014 5:02:23 P.M. Eastern Daylight Time,  
hoersting at gmail.com writes:

The Center for Competitive Politics has sued California to protect its  
donor list -- donations for c3 activities; far beyond elections.




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