A panel of federal appellate judges agreed Monday that a campaign contribution blackout law that has been in place in Arkansas since 1996 is probably unconstitutional.
The panel upheld a preliminary injunction that U.S. District Judge James Moody Jr. imposed June 17 to prohibit Arkansas Code Annotated 7-6-203(e) from being enforced while its constitutionality is determined.
The law, part of a package of campaign-finance measures approved by voters in 1995, bars candidates for state offices from accepting campaign contributions more than two years before an election.
On April 8, Peggy Jones of Pulaski County challenged the constitutionality of the law, saying it infringes on her right of political expression by preventing her from donating money early to people she wants to support as candidates in the 2022 election cycle. She has said there are several potential candidates she wants to support, but she named only one -- Sen. Mark Johnson, R-Little Rock -- after Moody suggested her case would be stronger if she identified one candidate.
Moody froze his ruling while Attorney General Leslie Rutledge's office appealed the injunction to the 8th Circuit. On Monday, attorney Chad Pekron of Little Rock, who represents Jones, asked the judge to lift the stay to allow the injunction to take effect.
Rutledge's office could seek a rehearing before the full 8th Circuit within 14 days. A spokesman didn't immediately return a call about how the office intends to proceed.
Until the stay is lifted, Pekron said, "no one can start raising money."
He said Jones "is very happy. She will soon be able to exercise her First Amendment rights, and exercise them at the time of her choosing."
In an opinion written by U.S. Circuit Judge David R. Stras of Minneapolis, the panel noted that in Arkansas, individuals can donate up to $2,700 to a candidate for the primary election and then can donate up to the same amount a second time, for the general election. But, under another section of the same law, candidates can only accept contributions within two years of an election.
"If money changes hands during a 'blackout period,' Arkansas has been clear that both the donor and the candidate who received the contribution can be prosecuted," Stras wrote.
Jones, a frequent donor to political campaigns, "wants to donate now to candidates who have expressed a willingness to run in 2022," the opinion said. "But her fear of prosecution, at least according to her complaint, has stopped her in her tracks."
Noting that Moody granted the injunction after determining that Jones was likely to win on the merits of her case, the appellate judges first considered whether Jones had legal standing -- a vested interest in the outcome of the case -- to sue Pulaski County Prosecuting Attorney Larry Jegley and the members of the Arkansas Ethics Commission, both of whom are tasked with enforcing the law.
Stras and his fellow panelists -- U.S. Circuit Judges Jane Kelly and Michael Melloy, both of Cedar Rapids, Iowa -- said Jones had adequately shown that she intends to engage in conduct "arguably affected with a constitutional interest," but faces a credible threat of prosecution if she does. They agreed that she had "adequately alleged a credible threat of prosecution," giving her standing.
Although attorneys for the state had argued that Jones couldn't claim a threat of prosecution before she had actually violated a law, the panel said, "We have repeatedly rejected the argument that a plaintiff must risk prosecution before challenging a statute under the First Amendment, and we do so again here."
The panel also said that it wasn't necessary for Johnson to have publicly announced his candidacy for reelection. Instead, the opinion said, anyone who "has knowingly and willingly taken affirmative action" for the purpose of seeking public office is considered a candidate.
Johnson has taken such action by telling Jones that he intends to run for reelection, even if he hasn't solicited or accepted contributions, the panel said, noting that he couldn't do so without being exposed to prosecution.
The panelists then considered whether Jones had met the four factors needed for a preliminary injunction -- a likelihood of succeeding on the merits, a likelihood of suffering irreparable harm without it, shown that the balance of equities tips in her favor and shown that an injunction is in the public interest.
"Only the conclusion that Jones is likely to succeed on the merits -- generally the most important factor in First Amendment cases -- is contested here," the panel said.
The judges noted that "the district court was right that, at this early stage of litigation, Jones is likely to succeed on the merits."
They said an individual is exercising a right to participate in public debate through political expression by contributing money to a candidate, and "any attempt to restrict political contributions must withstand exacting scrutiny. Under this standard, the state bears the burden of establishing that the restriction 'advances a sufficiently important state interest and employs means closely drawn to avoid unnecessary abridgement of First Amendment freedoms.'"
The state argued that the purpose of the blackout period is to prevent corruption or the appearance of corruption, but the panel said it hadn't shown that early contributions present a greater risk of corruption than later contributions.
The opinion noted that at the injunction hearing, attorneys for the state admitted they weren't aware of any evidence tying earlier contributions to the state's interest in preventing corruption.
The law at issue was part of a package of campaign-finance amendments approved by voters to combat corruption. Jones has said the inclusion of the blackout period in the package went too far.
The Institute for Free Speech, an Alexandria, Va.-based conservative organization, filed a friend-of-the-court brief with the 8th Circuit in September, siding with Jones.
A Section on 01/28/2020
CORRECTION: U.S. Circuit Judge David R. Stras of Minneapolis authored an 8th Circuit opinion, issued Monday, agreeing that an Arkansas law prohibiting campaign contributions more than two years before an election is probably unconstitutional. The judge was misidentified in an earlier version of this article.