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Panel Strikes Down Components of Campaign Finance Law

Splitting on nearly every key issue, a three-judge District Court panel dealt a damaging blow to the new campaign finance law Friday, striking down large portions of the federal soft-money ban and throwing out some regulations restricting issue advertising during campaigns.

“I believe the statute before us is unconstitutional in virtually all of its particulars,” wrote Judge Karen LeCraft Henderson, one member of the panel who issued the most damning assessment of the Bipartisan Campaign Reform Act, better known as McCain-Feingold after its authors.

“It breaks faith with the fundamental principle — understood by our nation’s Founding Generation, inscribed in the First Amendment and repeatedly reaffirmed by the United States Supreme Court — that ‘debate on public issues should be uninhibited, robust, and wide-open,’” Henderson stated.

The court said that state and national party committees may immediately return to raising unlimited funds from corporations, unions and wealthy contributors to use for grassroots, get-out-the-vote and other noncandidate-specific activity.

However, the court upheld the ban on soft money used for advertisements to promote or attack federal candidates and a prohibition on federal candidates soliciting soft money.

Increased hard-money contribution limits were left unchanged by the court, and the judges issued no ruling on coordinated spending or the so-called “millionaires amendment.”

The case will automatically be appealed to the Supreme Court, a provision contained in the law that took effect in November.

“Victory! Victory is ours,” exclaimed one Senate GOP aide upon learning the news of the court’s ruling, which was made public around 3:30 p.m. on Friday.

The aide dismissed the notion that the ban on soft money had most damaged Democrats, who in the two most recent election cycles relied on much higher percentages of soft money than Republicans. “Today was a victory for the defenders of the Constitution,” the aide said, noting that Republicans had been the most vociferous opponents of the new laws.

Bob Bauer, an attorney who represents Democratic Party elements, said, “Obviously, if the decision stands, the guts of the statute have been knocked out.”

But opponents of the new law weren’t entirely thrilled with the decision and in particular expressed concern about the court’s handling of the law’s electioneering communications provisions.

While the court struck the part of the ban that forbids such soft money ads within 30 days of a primary or 60 days of a general election, it upheld a backup definition that forbids soft money from being spent on an ad that “promotes or supports a candidate … or attacks or opposes a candidate.”

Cleta Mitchell, part of the legal team representing the National Rifle Association in the lawsuit, was pleased that the 30- and 60-day windows were thrown out but expressed discomfort with the court’s adoption of what many viewed as an even more vague definition of electioneering communication.

“The Supreme Court needs to finish the job,” Mitchell said.

James Bopp, an Indiana attorney who worked for the plaintiffs, predicted that his side will focus squarely on that section of the ruling in the appeal to the Supreme Court.

“Who now knows what speech is prohibited and what isn’t? There is simply no way to know,” he said.

Moreover, Bopp said he was “surprised they upheld as many provisions as they did. I don’t think they showed the sensitivity to the First Amendment issues that were at stake.”

He called the backup definition left in place by the ruling “more pernicious, more evil” than the provision that the court struck down limiting so-called sham issue ads within a set time period before each election.

On the soft-money ruling, Bopp said the three-judge panel “set the First Amendment on its head” because the ruling upheld the soft money ban for activities most associated with federal elections, which are core speech areas that he said the Constitution protects.

The outcome “doesn’t appreciate that the political parties have issue agendas they want to promote. They aren’t just federal election machines. They have principles, legislation and issues that they want and need to promote.”

Sen. Mitch McConnell (R-Ky.), the leading plaintiff in the suit to have the law declared unconstitutional, said Friday he was “gratified by much of the court’s decision today.”

“Obviously, it will take time to fully review a complex, 1,500-page ruling. That said, this case has always been headed to the U.S. Supreme Court and I look forward to leading the effort to make our case there,” McConnell said.

At this late date it is unclear exactly how quickly the Supreme Court will be able to take up the matter.

While the statute requires expedited consideration of the new law, the court has little time left in its calendar for arguments this session before the court adjourns for summer break. Some have suggested the justices may have to juggle their schedules for special consideration of the law this summer, while others have suggested that the case may have to be put off until the fall.

Congressional authors of the legislation cautiously assessed the damage Friday.

In a joint statement, Sens. John McCain (R-Ariz.) and Russ Feingold (D-Wis.) and Reps. Martin Meehan (D-Mass.) and Christopher Shays (R-Conn.) said that upon “initial analysis” they were “pleased with the District Court’s split decision upholding important provisions of the campaign finance reform law.”

But the lawmakers warned that the decision could “also could create serious loopholes that undermine the law’s effectiveness” and said they are looking to the Supreme Court to return the law to its original form.

They noted that the high court’s recent decisions in the Shrink vs. Missouri and Colorado II cases “indicate that the Court is sensitive to the real world effects of large contributions on our political system.”

Former U.S. Solicitor General Seth Waxman, one of the attorneys who argued the case before the three-judge panel on behalf of the Congressional sponsors, echoed those sentiments.

Said Waxman: “I am confident that the Bipartisan Campaign Reform Act meets constitutional standards and I am eager to present the case to the Supreme Court.”

Trevor Potter, another member of the legal team defending the law, said he believed the preliminary court’s findings bodes well for reforms.

“We’re pleased the court recognized Congress can, and should, act to stem political corruption,” Potter said. “The court rewrote portions of the law. But, given the finding by the District Court that Congress was justified in acting, and the evidence that influence is being bought with soft money, we’re confident the Supreme Court will uphold the entire act.”

Paul Kane contributed to this story.

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