The Washington Supreme Court has narrowly upheld the state’s $18 million fine against the Grocery Manufacturers Association, now the Consumer Brands Association, for violating campaign finance laws by concealing the identity of member donations to a campaign opposing a 2013 GMO labeling ballot initiative.
The issue in the case was whether the fine for “intentionally concealing the source of political contributions may be based on the amount concealed,” the state Supreme Court said in its 5-4 opinion released Thursday. “We conclude that it may and accordingly affirm.”
“Washington voters … have firmly established that they have the right to know who is paying for political campaigns, including initiatives, in this state,” the court said. “The voters and the integrity of the electoral process are harmed when that right is violated, especially when that information is intentionally concealed.”
“GMA’s decision to conceal the identities of its campaign contributors struck at the core of open and transparent elections,” the court said, adding that since the identity of $14 million in contributions was concealed, the fine could have exceeded $43 million under state law allowing a trebling of fines for intentional violations.
“This factor strongly suggests the $18 million fine was not grossly disproportional,” the court said.
GMA, the court said, “developed a campaign strategy to work against [Initiative 522] while shielding its member companies from the sort of negative public response that happened in California” when a GMO ballot initiative was on the ballot in that state 2012. Neither initiative succeeded.
The group “raised more than $14 million to oppose GMO labeling efforts” and contributed $11 million to a “No on 522” campaign from what it called its “Defense of Brands” account.
“GMA staffers explained that ‘state GMO related spending will be identified as coming from GMA which will provide anonymity and eliminate state filing requirements for contributing members,’ ” the court said.
GMA had argued that “concealing its contributors caused minimal harm because voters knew that grocery manufacturers opposed the initiative,” the court said. “But the harm was substantial and struck at the heart of the principles embodied in the [Washington Fair Campaign Practices Act]. Voters are entitled to know who is contributing to political committees and paying for political campaigns by name, not just by category.”
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The CBA said it was disappointed in the decision and said it “will pursue all legal options, including petitioning the U.S. Supreme Court, to receive a fair and impartial review of this decision.”
"The state’s legal process has been tainted by partisan politics,” the group said, adding it also "will chill core political speech by legitimate organizations based on their viewpoints. The only winner in this decision is politics – not the law, the facts or the American public."
GMA had argued that the state engaged in “viewpoint discrimination” by not going after an Iowa-based pro-initiative group for similar violations. “GMA does not, however, show that the state could have shown that Food Democracy intentionally violated the act or offer any evidence that the state was motived by viewpoint discrimination,” the court said.
That group was fined $320,000 for concealing nearly $300,000 in donations.
GMA could not show “it is being punished for ‘speaking more,’ ” the court said. “Instead, it is being punished for intentionally violating Washington’s fair campaign act.”
Dissenting from the majority opinion written by Chief Justice Steven Gonzalez, Justice Sheryl Gordon McCloud wrote that “the nature and extent of the crime in this case was a failure to report” and that “this tends to show that the fine imposed in this case — which related primarily to the amount of money that GMA failed to report rather than to the failure to report itself — was excessive.”
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