A July ruling by the U.S. Supreme Court (SCOTUS) regarding a California state donor disclosure law could have significant implications for an ongoing lawsuit against Washington state concerning the largest campaign fine in history.
The SCOTUS 6-3 decision in Americans for Prosperity Foundation v. Bonta overturned a California law requiring charities to disclose their top donors. The ruling states that while “we do not doubt that California has an important interest in preventing wrongdoing by charitable organizations…our cases have said that disclosure requirements can chill association.”
The Washington case that may be affected by the SCOTUS ruling, Washington State v. Grocery Manufacturers Association, originates from the 2013 campaign regarding Initiative I-522 mandating the labeling of genetically modified organisms (GMOs). The Grocery Manufacturers Association (GMA) was fined for failing to disclose fund sources and failing to register as a political committee. The group was initially fined $6 million, which later tripled to $18 million while the case was in superior court. The Washington State Supreme Court upheld the fines in an April 2020 decision.
Supporting the Washington state lawsuit now before SCOTUS is a group of elected officials, including former State Attorney General Rob McKenna, and various industry organizations.
The plaintiffs in the Washington case argue that the fine is excessive, which violates the Eight Amendment to the U.S. Constitution, and could have a “chilling effect” on free speech and political activity. Recent amicus briefs filed in support of the plaintiffs claim the SCOTUS ruling bolsters their legal argument.
That said, the SCOTUS ruling does not threaten the legality of Washington state’s Fair Campaign Practices Act which GMA violated. A statement from State Attorney General Bob Ferguson’s office notes that “Washington’s campaign finance law is narrowly tailored, so the problem the Court found in Bonta is not present here. That said, GMA never made the argument raised in Americans for Prosperity Foundation v. Bonta when it had the chance, so that claim is not present in our case.”
At the same time, an amicus brief filed in August by a group of industry members states that there “are differences between Bonta and this case, of course, but they are similar in this respect: regulations that threaten First Amendment rights deserve exacting scrutiny, even if their purpose is not to threaten those rights.”
The groups signed onto that brief include the Building Industry Association of Washington, the Washington Farm Bureau, the Washington Retail Association, the National Electrical Contractors Association and the Washington Food Industry Association.
An amicus brief filed by Rep. Drew Stokesbary (R-31) regarding the Washington lawsuit claims that excessive fines such as the one levied on the GMA could mean that “would-be participants will withdraw from the political arena to avoid the risk of facing ruinous penalties that may appear to relate more closely to the participant’s own political popularity or the zealousness of the State’s enforcement, rather than to the gravity of the underlying reporting error or the harm it caused.”
McKenna told Lens that the recent SCOTUS ruling is relevant because it deals with “the standard of scrutiny for the disclosure law. The Bonta significance may be (that) you’ve got a high level of scrutiny because of the First Amendment interest involved. You ought to be applying a heightened level of scrutiny in an excessive fine context because excessive fines in the political context are going to have a chilling effect.”
Washington State Supreme Court Justice Charles Johnson made a similar argument in his dissenting opinion on the GMA case. “Based on the record before us, this case also arguably presents First Amendment concerns that should be considered in conjunction with the excessive fines claims on remand.”
He added that the case “seems to exemplify an arbitrary and subjective selection of an organization in the political process,” noting that Food Democracy Action!, an organization favoring the initiative, also committed similar campaign disclosure and filing requirement errors, but did not have its fine tripled.
McKenna said it’s likely the difference in treatment will also impact the court’s decision. “The question is why did one get a tripling of its fine and the other one didn’t?”