Judge backs Minn. law requiring corporations, political groups to reveal donors and spending

Judge backs Minn. disclosure law on political cash

ST. PAUL, Minn. — A federal judge refused on Monday to interfere with a new Minnesota law that revealed political donations from Target Corp. and other companies, saying the public has an interest in knowing who speaks and who pays for those messages as the election approaches.

U.S. District Judge Donovan Frank denied a temporary injunction in a lawsuit brought by supporters of Republican gubernatorial candidate Tom Emmer, including an anti-abortion group and an anti-tax organization. They sued to overturn the law on free speech grounds and had asked Frank to suspend the disclosure requirements immediately.

Frank answered with a firm no.

“Invalidating the election laws at issue here would likely result in corporations making independent expenditures without any reporting or disclosure on the eve of the upcoming general election on November 2, 2010,” his ruling said. “This result so close to the election would clearly harm the state, Minnesota voters, and the general public interest.”

That came the day before independent political funds, including those collecting corporate dollars, are required to file their latest campaign finance reports with state regulators. They must list donors who gave more than $100 and show how they’re spending their money.

The law was enacted in May after a U.S. Supreme Court ruling early this year freed businesses to spend company money on elections, overturning restrictions on corporate political spending in about half the states, including Minnesota. State lawmakers responded by enacting disclosure requirements so that corporate campaign spending would be public.

The lawsuit from Minnesota Citizens Concerned for Life, the Taxpayers League of Minnesota and a travel agency contended that the reporting requirements were so burdensome that they amounted to a ban on free speech.

During election years, businesses and independent groups must submit five reports and disclose large donations within 24 hours for the three weeks leading up to the primary and the last two weeks before the general election. In off years, one report is required. The registration requirement is triggered when businesses or independent funds spend more than $100. Penalties for violations can be as high as $25,000.

Frank said the state law does not restrict corporations from spending freely on political speech as long as they follow the disclosure requirements.

“The law at issue here is not a ban, but rather a disclosure law,” his ruling said.

Joe La Rue, the Terre Haute, Ind.-based attorney for the groups that sued, had no immediate comment.

Attorney General Lori Swanson said the decision will help voters.

“This ruling lets average voters know who is financing elections in Minnesota,” she said in a statement.

The lawsuit also challenged the state’s prohibition on corporations contributing directly to candidates and political parties. But Frank said that ban wasn’t invalidated by the Supreme Court ruling, which revolved around with corporate independent expenditures made with the input or knowledge of candidates or political parties.

Target’s donation attracted national attention because it seemed to conflict with the company’s gay-friendly reputation. The Minneapolis-based retailer donated $150,000 to MN Forward, a business-oriented political fund supporting Emmer, an outspoken opponent of gay marriage, in the governor’s race.