C itizens United, the Virginia-based conservative advocacy group that won a major Supreme Court ruling in a dispute over a documentary film sharply critical of Hillary Clinton as a candidate, won another legal victory Thursday as the Federal Election Commission ruled by a 4-1 vote that the group’s film operations are part of the press.  That makes those activities exempt from federal law requiring public disclosure of the group’s income and spending on its film projects.

While the Supreme Court ruling in January (Citizens United v. FEC) gave the organization a constitutional right to spend unlimited funds on political advocacy in federal elections, the Justices turned aside the group’s constitutional challenge to the disclosure requirements imposed by federal campaign finance law for those who broadcast campaign information on radio, TV and cable during election season, if they identified a specific candidate.  In Thursday’s FEC ruling, however, the group won an exemption from those same requirements, by gaining designation as a press entity.  (The FEC had before it two drafts on Thursday — Draft A, granting the exemption, and Draft B, limiting the exemption.  Draft A won approval; Draft B was not voted on.  The two drafts can be read here.)

The Commission, with three Republican members and one Democratic member voting in favor and one independent member voting against, approved an advisory opinion that noted that the FEC had recently expanded the concept of who is part of the press well beyond the traditional news media.   Thus, it concluded that Citizens United would be considered a press entity and thus exempt from having to disclose the costs of producing and distributing its documentary films, and advertisements and other marketing promotions of those films.

Citizens United since 2004 has produced and distributed 14 films, the best known of which is the 90-minute production, “Hillary: the Movie,” that had figured in the Supreme Court case.  Another was a critical movie about President Obama as a candidate, “Hype: The Obama Effect.”

Within two months after the Supreme Court had upheld the financial disclosure requirements as they applied to Citizens United, the organization asked the FEC to issue an advisory opinion that Citizens United qualified for what is known as the “press exemption.”  That exemption, under federal law, is available to those who publish “a news story, commentary, or editorial.”  Previously, in September 2004, the FEC had rejected a plea by Citizens United for press status under that provision.

Two organizations that strongly support federal regulation of campaign finance, Democracy 21 and the Campaign Legal Center, had urged the FEC on Wednesday not to give Citizens United status as a press entity.  Those groups told the Commission in a letter: “If the Commission determines that a classic advocacy organization like Citizens United acquires the protections of the press exemption merely by producing a handful of films in furtherance of its advocacy mission, the unbounded nature of that determination will open the door for any and all advocacy groups to obtain an exemption from the campaign finance laws.”

In Thursday’s vote, Republican Commissioners Matthew R. Petersen (chairman), Caroline C. Hunter and Donald F. McGahn II and Democratic Commissioner Cynthia L. Bauerly (vice chair) voted for Draft A, and independent Commssioner Steven T. Walther voted against it.   In a statement, Walther said that the FEC should reconsider, as part of a broader review of campaign finance rules in the wake of the Supreme Court’s Citizens United decision, a move to narrow the scope of the press exemption from where it now stands under FEC rulings.  (Democratic Commissioner Ellen L. Weintraub was absent, and did not vote.)

Posted in Cases in the Pipeline