PAC Registration and Magic Words

Nevada is in the midst of one of the first high-profile election law cases since the United States Supreme Court decided Citizens United v. FEC.  A Virginia corporation called Alliance for America’s Future aired a pro-Brian Sandoval ad in Nevada.  (There is nothing to suggest the group is affiliated with the Sandoval campaign).  The Nevada Secretary of State filed suit and obtained a temporary restraining order.

In Citizens United, an outright ban on corporate expenditures on political advocacy was overturned.  However, the Court left reporting and disclosure requirements in place.  In the Alliance matter, the Nevada Secretary of State alleges that the Alliance violated the law by failing to register as a PAC before airing its advertisement.  It’s a bit different from the underlying issue in Citizens United because there is no outright ban on airing political advertisements, but instead there is a rule that groups such as Alliance who engage in such activity must register as a PAC and disclose certain information, including contributors to the PAC.

Regardless, the main defense raised by Alliance doesn’t turn on whether disclosure and registration itself is unconstitutional.  Instead, the Alliance argues that registration and disclosure are only required by Nevada law if the Alliance engaged in “express advocacy.”  Although it seems obvious that any Nevadan paying even remote attention to politics would realize that the ad is intended to support Sandoval’s gubernatorial candidacy, the Alliance cites to numerous published cases holding that express advocacy requires certain “magic words” like “elect,” “vote for,” support,” etc.  And because the ad carefully avoided the use of such “magic words,” the Alliance argues that it cannot be required to register as a PAC.

So what does it mean in terms of ramifications?  After Citizens United, non-Nevada groups already have the ability to spend money to influence elections here.  If the Alliance or Secretary push the present dispute to the Nevada Supreme Court and the Alliance prevails, those groups will also be able to avoid registration and disclosure requirements by carefully phrasing the language in their advertisements.  To some, such a result is cause for dismay as relatively-anonymous corporate dollars would be used to influence elections.  To others, it would be cause for rejoice as individuals and corporations would face less obstacles to expending their money to engage in political speech.  And to others, it won’t really matter one way or another because those who want to spend money on elections will generally find a way.

One Response to PAC Registration and Magic Words

  1. Doug Thornley says:

    Josh –

    Isn’t the registration requirement a content-based legislative prior restraint – the corporation is required to register with the State before disseminating political speech based on the content of the message (“express advocacy”)? Do you think the result of this case would have been different had Alliance gone down the path of a constitutional challenge? Certainly there are various state interests that have been deemed “compelling” for purposes of restricting certain aspects of a political campaign that are protected by the First Amendment, but many of those relate to contributions, not expenditures. The prevailing view, as I understand it, is that a constitutionally sufficient state interest in restricting political contribution – generally regarded as an associational freedom – need not be as “compelling” as a state interest in restricting political expenditure – which is more akin to speech. See Nixon v. Shrink Missouri Government PAC, 528 U.S. 377 (2000).

    For the sake of wild speculation, I’m not certain it would have made much difference. The State may well have a constitutionally compelling interest in making sure its citizens know the source of political advertisements and a registration requirement is probably narrowly tailored. Nevertheless, wouldn’t this have been a more interesting discussion than whether or not the ad amounted to “express advocacy?”

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