Academic journal article Harvard Law Review

Defining the Press Exemption from Campaign Finance Restrictions

Academic journal article Harvard Law Review

Defining the Press Exemption from Campaign Finance Restrictions

Article excerpt

Six years before its name became synonymous with "one of the most reviled decisions of the Supreme Court in recent years," (1) the nonprofit advocacy group Citizens United asked the Federal Election Commission (FEC) whether its documentary on presidential candidate John Kerry qualified as journalism. (2) The FEC's opinion mattered because under the statutory "press exemption," federal campaign finance restrictions do not apply to costs associated with producing news. (3) At the time, a corporation like Citizens United could not spend money independently on communications that referred to a clearly identified federal candidate within thirty days before a primary election or sixty days before a general election--unless that corporation qualified for the press exemption. (4) In 2004, the FEC concluded that Citizens United was not entitled to the press exemption for the costs associated with producing and airing the documentary. (5)

Citizens United was thus unable to take advantage of the press exemption when, in January 2008, it produced a documentary about Hillary Clinton to be advertised on television and distributed through video-on-demand. (6) To air the advertisements and sell the documentary, Citizens United sued for declaratory and injunctive relief to invalidate the then-valid federal ban on (non-press) corporations using their general treasury funds to fund independent expenditures that clearly identified a candidate for federal office. (7) That case, of course, went to the Supreme Court, which sided with Citizens United. (8) Justice Kennedy's opinion for the Court touched briefly on the statute's press exemption, concluding that its inclusion in the law did not mitigate the First Amendment concerns with a ban on corporate independent expenditures: "There is no precedent supporting laws that attempt to distinguish between corporations which are deemed to be exempt as media corporations and those which are not." (9) The Citizens United majority did not decide whether Citizens United was eligible for the press exemption; instead, it held that the First Amendment did not permit Congress to limit the independent expenditures of any corporation. (10) Justice Stevens, concurring in part and dissenting in part, asserted briefly: "Citizens United is not a media corporation." (11)

But Citizens United was not satisfied with its victory for corporate independent expenditures. The Citizens United Court did not address whether the First Amendment protected the right of corporations to contribute directly to candidates. Non-press corporations remain prohibited from making contributions--including in-kind contributions like "coordinated communications" (12)--to federal candidates. (13) And, under the statute, press corporations are exempt from the federal disclaimer and disclosure requirements. (14) So six months after the Supreme Court decided Citizens United, the FEC revisited whether Citizens United's documentaries qualified for the press exemption. This time, noting that Citizens United had produced and distributed fourteen documentary films since 2004 and that a substantial portion of its annual budget had been devoted to producing and distributing these films, the FEC advised that Citizens United was entitled to the press exemption for the costs associated with making its documentaries. (15)

As the Citizens United story demonstrates, the FEC has encountered new controversy over how to apply the press exemption. On one side, some Commissioners are concerned that unless the FEC denies the press exemption to some corporations (like a retail store that distributes a newsletter to customers), the press exemption will become a loophole through which any corporation could evade contribution prohibitions and disclosure and disclaimer requirements. (16) On the other side, some Commissioners are concerned that the First Amendment does not permit the FEC to determine who is and is not press. (17) Those Commissioners who want to deny the press exemption based on the corporation's functions (such as the retail store with a newsletter) therefore need an argument rooted in the First Amendment to persuade those who believe that the First Amendment's protection of freedom of speech requires the FEC to apply the press exemption broadly and neutrally to any corporation that disseminates information. …

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