Speech topic - Campaign Finance

Online campaign ads
By Scott Felsenthal
First Amendment Center legal intern

Introduction
With election-campaign contributions and spending reaching all-time highs, the question many ask is, “Where is all this money coming from”? It’s coming from wealthy individuals, corporations and others who hope that investing in candidates’ campaigns will bring returns in the form of policy decisions or bills that will benefit them. And to reach them, politicians are increasingly turning to the Internet to make their plea for campaign cash.

With the continued rise in Internet use, more and more political candidates are devoting more and more time to campaigning and getting their messages across to potential voters online. Candidates have realized that the Net is a far cheaper method of advertising and fundraising in their drive for political office than more traditional methods. Former presidential hopeful Howard Dean, for example, raised tens of millions of dollars on the Web in 2004.

The Federal Election Commission revised regulations in 2006 governing various types of campaign advertising via the Internet. Before looking at these new regulations, we need to understand how they were reached. The following article will examine the Bipartisan Campaign Reform Act (otherwise known as the McCain-Feingold Act), the important case of Shays v. Federal Election Commission and the new federal regulations relating to the Internet.

In addition, a related compilation analyzes 10 states’ election-disclaimer laws — laws that require political candidates and committees to disclose certain facts about various aspects of their campaigns.

Bipartisan Campaign Reform Act
The Bipartisan Campaign Reform Act (“McCain-Feingold”), was passed by Congress in 2002. For purposes of this discussion, this act amended the Federal Election Campaign Act of 1971 in various ways with regard to the definition of “public communication.” Among these important changes:

  • Congress defined a “public communication” as a “communication by means of any broadcast, cable, or satellite communication, newspaper, magazine, outdoor advertising facility, mass mailing, or telephone bank to the general public, or any other form of general public political advertising” 2 U.S.C. 431 (22)

  • Congress revised the “disclaimer” requirements by requiring a disclaimer on an ad whenever a disbursement for “general public political advertising” is either made by a political committee, expressly advocates the election or defeat of a clearly identified candidate, or solicits any contribution.

  • In revising the disclaimer requirements, Congress relied upon the definition of “public communication,” as defined above. Therefore, most Internet content was excluded from the disclaimer requirements set forth by the Bipartisan Campaign Reform Act. In 2003, the U.S. Supreme Court upheld BCRA in McConnell v. Federal Election Commission.

    Shays v. Federal Election Commission
    Reps. Christopher Shays, R-Conn., and Martin Meehan, D-Mass., commenced a lawsuit in October 2002 against the FEC for purportedly implementing regulations not in compliance with the McCain-Feingold act. Shays and Meehan argued that Internet material should be subject to the regulations under the act and emphasized that the FEC must create regulations controlling Internet content used for political purposes (i.e., campaigning, fundraising, etc.). In 2004, Judge Colleen Kollar-Kotelly of the U.S. District Court for the District of Columbia agreed with Shays and Meehan in her opinion in Shays v. Federal Election Commission. Kollar-Kotelly held that the previous definition of “public communication” wrongfully excluded all Internet communications. The court concluded that some Internet communications do fall within the scope the definition of “public communication” in that they fall under the category of “any other form of general public political advertising.” Therefore, the court required the Federal Election Commission to determine which types of Internet communications should be controlled by that phrase. Shays v. Federal Election Commission, 337 F. Supp. 2d 28 (D.D.C. 2004), aff’d, 414 F.3d 76 (D.C. Cir. 2005)

    Campaign ads and the Net
    On March, 27, 2006, the Federal Election Commission approved new regulations governing various types of Internet communication. The rules officially took effect on May 12, 2006. The new rules, amended in response to Shays v. Federal Election Commission, attempt to ensure that political committees properly finance and disclose their Internet communications and advertisements — but without hampering individual citizens in using the Internet to speak freely regarding candidates and elections. More specifically, the rules make it clear, as the FEC stated, “that the vast majority of Internet communications are, and will remain, free from campaign finance regulation ... . Internet activities by individuals and groups of individuals face almost no regulatory burdens under the Federal Election Campaign Act. The need to safeguard Constitutionally protected political speech allows no other approach” (as quoted in the Federal Register, p. 18590).

    The FEC rules include paid advertising on the Internet within the definition of “public communication.” The most relevant changes include:

  • When someone such as an individual, political committee, or corporation pays a fee to place a political banner, video, or pop-up advertisement on another person’s Web site, the “person paying makes a ‘public communication’” and is thereby subject to the federal disclaimer requirements. Content one places on his/her own Web site is not subject to the “personal communication” requirements and is not subject to any disclaimer regulations.

  • Political committees must include disclaimers on their Web sites and e-mail distributions sent to a mass audience (500 or more unsolicited ‘substantially similar’ e-mails) if the e-mails expressly advocate the election or defeat of a clearly identified candidate for federal office.

  • People and entities other than a political committee need to include disclaimers only on paid Internet advertising that qualifies as a “public communication” and if the communication is being used to advocate expressly an election or defeat of a clearly identified federal candidate.

    Conclusion
    With the Internet becoming an integral part of today’s society, politicians are seeking to use it to their advantage. Although the FEC’s newly implemented Internet regulations do not place strict limitations on political candidates and their organizations, they do alert political candidates that the Internet is no longer an unrestricted area for advertising. The FEC believes that the Internet will always be free from most campaign regulations; however, it is yet to be seen if the FEC will tighten the Internet regulations that were implemented in 2006.

    Scott Felsenthal is a second-year law student at the Nashville School of Law. He can be reached at sfelsenthal@freedomforum.org.