Two business owners, after losing a challenge to the state's ban on corporate political donations in the state Supreme Judicial Court, are seeking to overturn the law before the U.S. Supreme Court, deriding it as an unfair "loophole" for unions.
The small businessmen, with the help of the Goldwater Institute, will file a petition with the Supreme Court on Wednesday asking the nation's highest court to "strike down Massachusetts' unbalanced campaign-finance scheme for violating the First Amendment and the Equal Protection Clause of the Fourteenth Amendment."
The Massachusetts Fiscal Alliance has also been closely involved in the case, and supports the appeal being brought by its co-founder Rick Green and board member Michael Kane, the two plaintiffs in the case.
"I really just want to be treated equally to others," said Kane, the owner of the Ashland-based 126 Self Storage. In a conference call Tuesday, Kane quoted from the 14th amendment, and said, "I am a person. You're all hearing me talk. I was born and raised in this state in 1951 ... We small businesses, we are people. Just treat us the same."
Massachusetts law prohibits corporations from contributing directly to candidates or establishing political action committees, but allows them to make unlimited independent expenditures, with certain disclosure requirements.
The plaintiffs in the state case, which also included 1A Auto owner and Congressional candidate Green, argued that the ban violates their First Amendment rights and unfairly applies to corporations but not other entities like unions and nonprofits.
Unions, for example, are allowed to contribute up to $15,000 each cycle to political candidates.
"The Supreme Court has emphasized the government can't use laws to favor some groups in politics over others and yet this Massachusetts scheme allow unions to make political contributions while it bans businesses from doing so," said Jacob Huebert, senior counsel for the Goldwater Institute.
Huebert said the law effectively favors pro-union ideas and candidates. "That's something the government shouldn't be doing under the first amendment, under the equal protection clause," he said.
In a decision issued in September, the Supreme Judicial Court in Massachusetts ruled that the ban on corporate political donations does not violate free speech rights and can help prevent actual and perceived corruption.
Allowing corporate contributions would create "a serious threat of quid pro quo corruption," Chief Justice Ralph Gants wrote in the decision.
Huebert, however, said Justice Scott Kafka may have given the plaintiffs a roadmap for how to challenge the law in federal court with his concurring opinion.
Kafker's opinion said it was difficult to determine if the ban's "differential treatment of business corporations rests on grounds considered legitimate, illegitimate or both," and concluded that the majority opinion did not adequately address the issue of the law failing to prohibit contributions by other entities.
Huebert said the SJC based its decision on a 2003 precedent set by the Supreme Court upholding a federal ban on corporate political giving, but said the Supreme Court in later rulings has made it clear that it does not look favorably on "discriminating against corporations."
"We're optimistic that this is a court that's friendly to first amendment rights in general and particularly in the campaign finance context," Huebert said.
In its decision upholding the Massachusetts law, the Supreme Judicial Court instructed the Office of Campaign and Political Finance to codify the rule regarding corporate and union contributions, and the agency has a hearing on the topic scheduled for Thursday.
The OCPF hearing on Thursday at 2 p.m. is listed as an initial pubic hearing as the agency considers whether to codify its existing definition of a political committee or replace it with a different standard. The agency anticipates issuing new draft reguations by Feb. 1, to hold a hearing on March 5 and to issue a final regulation by May 1.
Mass Fiscal board member Paul Craney and counsel Tad Heuer from Foley Hoag are both expected to testify on behalf of the alliance in favor of scrapping the rule, which would negate the the need for the lawsuit.
"We're somewhat hopeful that OCPF doesn't want to pursue this union loophole either," Craney said.
Craney ticked through a list of state races where the "union loophole" has come into play and given one candidate, always a Democrat, a financial edge over his or her opponent.
Among those races, according to Craney, was Boston Mayor Marty Walsh's first run for mayor in 2013 against John Connolly, Republican Rep. Keiko Orrall's race for treasurer against incumbent Deb Goldberg, Josk Zakim's primary challenge to Secretary of State William Galvin and Sen. Paul Feeney's special election against Republican Jacob Ventura.
"It's an unfair advantage for some candidates," Craney said.
Huebert said it could be several months before the plaintiffs, the Goldwater Institute and the Fiscal Alliance, find out whether the Supreme Court will hear the case.
