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The Federal Election Commission (FEC) enacted a rule requiring disclosure of donors whose donation was made "for the purpose of furthering electioneering communications."  Maryland Rep. Chris Van Hollen challenged this rule on grounds that it created a loophole in the law.  According to Van Hollen, fewer than 10% of the contributors to electioneering communications in 2010 were disclosed to the FEC.

The US District Court agreed with Van Hollen, holding that the statute requires disclosure of ALL contributors of $1000 or more to organizations placing "electioneering communications," even if the contributions were not made for the specific purpose of funding the electioneering communication.  The number of contributors that would need to be disclosed under this ruling could be quite high, particularly since the US Supreme Court allowed corporations and unions to fund independent electioneering communications in its landmark 2009 Citizens United case discussed here.

 So, while some PACs erroneously claim they are "prohibited" from running electioneering communications due to a recent "FCC" ruling, the truth is that they do not want to subject themselves to the broad disclosure requirements established in the Van Hollen case.  The case is on appeal to the DC Circuit, so we should soon know whether the FEC or the US District Court was right in their respective interpretations of the disclosure statute.

In the meantime, "electioneering communications" can be avoided by not referring to a specific candidate, by avoiding states where primaries are to occur within 30 days or by communicating the message to fewer than 50,000 people.  While these ads will still be considered "independent expenditures" that have their own FEC reporting requirements, they are not nearly as burdensome as those recently imposed by the court on "electioneering communications."

An opinion released several weeks ago by the US Court of Appeals for the First Circuit sheds some light on whether statements made in the context of a third party political ad are defamatory.  The ad at issue there was a negative campaign ad against a candidate for the Maine State Senate.  The ad stated that the candidate, as a town selectman (equivalent to city council) "voted to cancel the $10,000 fireworks celebration for the Fourth of July," while also "[giving] 10,000 taxpayer dollars to a political organization."  The ad then stated that "It's wrong for [the candidate] to give your money to a political organization, and it was wrong for [him] to cancel your 4th of July celebration."

The candidate claimed that the word "wrong" implied that he had committed a crime and that the words "political organization" implied that it was the candidate's own organization, therefore implying that he had stolen town funds for his own organization.  The court disagreed and granted the defendant's motion to dismiss.  Why?

First, the court held that a political candidate is "public" figure.  In order for a statement to be defamatory against a public figure, the statement must be made with "actual malice," which means that it must be made with knowledge of falsity or with "reckless disregard for the truth."  The court held that this standard could not be met here because the word "wrong" does not necessarily mean that the candidate broke the law.  Although the court did not elaborate on this, the word "wrong" is often used to convey the speaker's opinion rather than as a statement of fact.  In other words, in a political ad, one party often believes that what the other party does is "wrong," even though it is neither criminal nor immoral. A statement presented as an opinion generally is not defamatory.

The court also refused to draw the inference that the "political organization" referred to in the ad was the candidate's own organization.  In essence, the entire ad was an opinion that the candidate's use of $10,000 would have been better spent on fireworks rather than on a political organization of any kind, and there is nothing defamatory about that allegation/opinion.

In this particular case, the court also found that the allegations were true, which is an absolute defense to defamation, as noted above.  However, for purposes of ruling on the motion to dismiss, the court viewed the allegations in the most favorable light to the plaintiff (the non-dismissing party) and still found that the statements were not defamatory, even if untrue.

The lesson to be learned is that political speech is subject to strong First Amendment protection.  Most of the negative ads do not need to be taken down, even if you get a cease and desist letter.  You may need to be concerned if the statements made are potentially defamatory, charging that a candidate has committed a crime or an immoral or unethical act.  And you should request substantiation of any potentially defamatory claims made in the ad.  But merely stating that a candidate did something "wrong" does not necessarily imply criminality or unethical behavior.  It may simply be "wrong" in the eyes of the advertiser, and that is a mere opinion.

Of course, if there is any question about the content of a political ad, you should consult with legal counsel.  This is one area where it is better to be safe than sorry.

Stations are not required to accept third party ads and, even where these ads address a candidate, the station has full rights to accept or reject the ads based on the ad's content (perhaps subject to Zapple discussed below).  However, because the station can choose whether or not to run the ad, the station can also be held liable for the content of those ads.  While the standard for liability under the rules of defamation are very high for public figures such as a political candidate, there still can be liability if the station runs an ad with "malice", meaning that they either know that the content of the ad is false, or run it with reckless disregard of the truth of the claims made (where those claims later prove to be false).  That malice standard is what forces stations to become political researchers - tasked with determining if there is a reasonable basis for a claim made in an ad so that the candidate being attacked cannot later come back against the station and accuse the station of recklessly running a false ad.  We've written before (here and here) about the typical scenario that arises - a third party group buys an attack ad against a political candidate, the candidate or his or her lawyer sends the station a letter saying that claims made in the attack ad are false and the station will be liable if the station continues to run the ad.  At that point, the station has an obligation to investigate the truth of the statements made in the ad.  If the station just continues to run the ad with no investigation, and the ad proves to be false and the candidate that is attacked can prove injury, the station can be held liable.  How much investigation is necessary?  That is a question that cannot be answered in a few paragraphs on this blog.  But suffice it to say that stations need to be prepared to call their attorneys and discuss the issue with their owners in making these assessments - as each station may have a different tolerance for risk, and a different willingness to allow questionable third party ads to run.

The other potential issue that this decision may bring to the fore is the status of the Zapple Doctrine.  Section 315 of the Communications Act imposes the Equal Opportunities doctrine (otherwise known as "Equal Time") on stations, which the FCC has interpreted to mean that stations need to treat all candidates running for the same office in the same way - allowing them to buy equal amounts of advertising time on a station, and giving them equal amounts of free time on a station if the candidate appears outside of an exempt program (e.g. news or news interview programs, or on-the-spot coverage of a news event, including most debates).  But the Equal Opportunities Doctrine applies only to candidates and their appearances  on stations (or "uses", in the language of the FCC).  What about the purchase of time by third party groups, which are technically not subject to the Equal Time rule?  Well, more than 30 years ago, the FCC adopted the Zapple Doctrine, or "quasi-equal opportunities" as an outgrowth of the Fairness Doctrine.  The Zapple case, as we wrote here and here, held that where supporters of a candidate are allowed to buy time on a station, supporters of the opposing candidate should also be allowed to buy roughly equivalent amounts of time.  While the remainder of the Fairness Doctrine has been declared by the FCC or by the Courts to be unconstitutional over the last 25 years, Zapple has never been officially overturned.  When the Swift Boat documentary was about to be run on some television stations during the Kerry-Bush campaign, the Kerry campaign invoked Zapple in claiming that all stations that ran that documentary would need to air equal amounts of time from pro-Kerry groups.  While that matter was settled before the FCC ruled, some FCC officials have from time to time implied that they would have invoked Zapple had it gone to a decision.  With an influx of corporate money into political campaigns, Zapple issues are more likely to find their way to the FCC in coming elections.

Finally, the Citizens United case did not upset the record-keeping and disclosure requirements of the Bipartisan Campaign Reform Act ("BCRA").  BCRA imposed many such obligations on broadcasters.  Thus, the sale of time to corporate groups, just like the sale of time to any other third-party group, requires a full public file disclose when such purchases are made to address a Federal issue or election.  We wrote about those obligations here and here. Essentially, all the same information about the purchase that would be kept for a candidate buy must be kept for a third-party buy - including the class of spots purchased, the schedule run, the price paid, and the identity of the purchaser.  Even advertising buys dealing with state and local elections require an identification of the buyer and its principal officers or directors.

Thus, while more money may flow into broadcast stations as a result of the Citizens United decision, that money may come with some additional headaches for broadcasters.  All of these issues and more are addressed in the Davis Wright Tremaine Political Broadcasting Guide, available here.

On Monday night, the Clinton campaign has purchased an hour long block of time on the Hallmark cable channel to cover a town hall meeting.  Cable, unlike over-the-air broadcasting, is not subject to reasonable access requirements , so there was no obligation for the channel to sell time to the campaign.  And for network cable, it is still an open question as to what other FCC political rules apply.  The Commission recently went out of its way to avoid answering whether the equal opportunities rules apply to network cable by deciding that CNN did not violate the equal time rules by denying Dennis Kuchinich an opportunity to participate in a recent debate (see our summary of the case here).  From the lengths that the Commission went to in avoiding providing a direct answer to the question of whether equal opportunities applies to network cable programs, it could almost be inferred that, if push came to shove, the FCC would ultimately apply these rules if it could not otherwise avoid the issue.  But even if the rules applied, the sale of the programming block to the Clinton campaign would just give the Obama campaign the right to buy an hour of time, which it may or may not want.  And what rates would apply?  Applying the rules used for broadcast stations, if hour long blocks of time are not customarily sold by a network, the network could charge a reasonable amount, including a mark-up for lost audience in following time periods, according to recent FCC statements about the sale of block programming.

Around the country, in anticipation of the voting, third party groups including labor unions and other advocacy organizations are running ads supporting or opposing candidates.  These ads are not entitled to lowest unit rates (which are for candidates only), and stations need not sell time to these groups if they do not want to (reasonable access also applies only to candidates).  If a station does sell time to these groups, is there a requirement that a station sell time to supporters of both sides?  That is an open question.  While the FCC did away with most of the "Fairness Doctrine" over a decade ago, there is still a last thread of that doctrine that has never been officially abolished - the "Zapple Doctrine."  That doctrine was essentially equal time for supporters of a candidate - if a station sold time to the supporters of one candidate, it had to sell that time to the supporters of the other.  While the doctrine has not been applied in the last two decades, it has not been explicitly overruled so, if a station refused to sell to supporters of one side, the FCC might be forced to deal with that issue.

In fact, would that doctrine come into play in connection with the radio talk show hosts that are overtly partisan on the air?  According to press reports, many of the conservative radio talk show hosts have been aggressively anti-McCain in their programs.  As there are usually no appearances by the candidates on these programs, there are no equal opportunities issues, as equal opportunities is triggered only by the actual appearance of a candidate.  But could the Zapple Doctrine apply?  Traditionally, that doctrine applied to the purchase of time.  However, four years ago, when certain television stations thought about airing the "documentary" from the Swift Boat veterans attacking John Kerry, the Kerry campaign argued that the supporters of the Kerry campaign were entitled to free time under the Zapple Doctrine.  That case never reached a decision as the stations dropped their plans to air the film, but it remains an open issue (though more than a bit of a long-shot as it would seemingly render the abolition of the Fairness Doctrine meaningless, and raise significant First Amendment issues).

For more discussion of the FCC rules regulating broadcasters and political broadcasting, click on the Political Broadcasting subject heading on the right of this page, and read our Political Broadcasting Guide.  And watch for more discussion of political issues, as they arise, here.