Professor Richard L. Hasen (rick.hasen@lls) Loyola Law School, Los Angeles

1. Constitutional and Normative Issues Related to the Regulation of Internet-Based Campaign Activities Under the California Political Reform Act Professor Richard L. Hasen (rick.hasen@lls.edu) Loyola Law School, Los Angeles Prepared for presentation at March 24, 2010 Los Angeles Hearing, Fair Political Practices Commission, Subcommittee on the Political Reform Act & Internet Political Activity

2. Outline of presentation I offer three main points in my presentation:

3. 1. The “Goldilocks” Approach The appropriate model for regulation of Internet-based campaign communications should focus on the role of money in the communications and unique features of Internet-based communications, following the approach of the PRA generally.

4. 2. Appropriate and Sensible Regulation of Internet-Based Campaign Communications The FPPC and Legislature should carefully examine existing campaign finance regulations and laws, and they should consider appropriate and sensible revisions related to Internet-based campaign communications that further goals of PRA.

5. 3. Exemptions from Public Disclosure for Low-Dollar Campaign Activities Campaign finance regulators should create a safe harbor from public disclosure (especially over the Internet) for low-dollar campaign-related activities. An exemption from public disclosure (as opposed to reporting to FPPC) may be constitutionally necessary to avoid threats of harassment, and likely represents good public policy.

6. 1. Normative Views about Regulating Internet-Based Campaign Communications: The Goldilocks Approach Three approaches to question: A. Hands off the Internet (example of FEC rulemaking, and proposal to require disclosure by bloggers on blog pages that they were paid by campaigns) This approach appears evident in Bipartisan Commission report of 2003 (besides spam/fraud issues)

7. Problems with first approach (1) Significant campaign-related activity is shifting to Internet (Obama fundraising example), and therefore if there are good reasons to regulate generally, Internet exemption becomes big “loophole” (2) With shifts in technology, total Internet exemption can lead to arbitrary results (e.g., near-convergence of television and computer)

8. B. Simply import same rules applicable to non-Internet campaign regulations to Internet

9. Problems with Second Approach (1) Grassroots speech may be chilled by excessive and unnecessary regulation: some Internet-based campaign communications do not raise same dangers of corruption and do not deserve same regulation (inadvertent creation of a “political committee” through political discussion via email) (2) Impracticality of some regulation (e.g. requiring disclaimer in 140-character Twitter “tweet”)

10. C. Goldilocks Approach The appropriate model for regulation of Internet-based campaign communications should focus on the role of money in the communications and unique features of Internet-based communications. Regulation should be consistent with purposes of the PRA.

11. 2. Goal of Goldilocks Approach: Follow the Money The key reason for disclosure regulation is not to chill political speech but to deter corruption, provide the public with relevant information, and facilitate the enforcement of campaign contribution limits. The key reason for contribution limitations is to prevent corruption and the appearance of corruption.

12. Implementing the Goldilocks Approach The FPPC and Legislature should carefully examine existing campaign finance regulations and laws, and they should consider appropriate and sensible revisions related to Internet-based campaign communications that further goals of PRA.

13. For example, if millions of dollars are spent on online ads, disclaimers on those ads should not be exempt because they happen to appear on Internet rather than television.

14. 3. Special Concerns About Disclosure Over the Internet Campaign finance regulators should create a safe harbor from public disclosure (especially over the Internet) for low-dollar campaign-related activities. An exemption from public disclosure (as opposed to reporting to FPPC) may be constitutionally necessary to avoid threats of harassment, and likely represents good public policy.

15. The Constitutional Baseline The Supreme Court has recognized the three interests in disclosure regulation (Buckley, Citizens United), and that the information interest standing alone can justify disclosure. This means that disclosure may be required for both candidate and ballot measure elections.

16. The Constitutional Need for an Exemption • Threats of harassment provide a basis to limit disclosure (Socialist Workers ‘74 case) • Also a right to some anonymity, perhaps for actors spending little money (McIntyre)

17. How the Internet Changes the Disclosure Issue • Threats of harassment increased because of the dramatic decrease in the cost of obtaining disclosure information (fundrace.org, eightmaps.com). • Prop. 8 case (ProtectMarriage.com),Doe v. Reed, and the changing landscape of disclosure rules

18. Constitutional/policy implications • There may be constitutional reasons to limit public disclosure of small contributions and other similar information. • Even if not constitutionally compelled, there are strong public policy reasons to consider an exemption from public disclosure of such information.

19. Distinction between disclosure to public/reporting to agency • It still may be constitutional (and good policy) to require full reporting (even of small contributor identities) to FPPC (but not to public) • Reporting insures that campaigns and committees do not make end runs around contribution laws and keeps public confidence (Obama <$200 contributors’ example).