House Committee Holds Hearing on Regulation of Internet Speech

September 22, 2005. The House Administration Committee held a hearing titled "Political Speech on the Internet: Should it be Regulated?".

Opponents of government regulation of Constitutionally protected free speech, including former Federal Election Commission (FEC) Commissioner Brad Smith, warned the Committee about the FEC's open rulemaking proceeding regarding regulation of speech under the rubric of the Federal Election Campaign Act (FECA), as amended by the Bipartisan Campaign Reform Act of 2002 (BCRA). Others advocated the necessity of such regulation.

Background. The BCRA, which is also known as McCain Feingold, is now Public Law No. 107-155. Sen. John McCain (R-AZ) and Sen. Russ Feingold (D-WI) were the lead sponsors in the Senate. Rep. Christopher Shays (R-CT) and Rep. Marty Meehan (D-MA) were the lead sponsors in the House.

As required by the BCRA, the FEC promulgated implementing regulations. At issue is the definition of "public communication". 2 U.S.C. § 431(22) provides that "The term ``public communication´´ means a communication by means of any broadcast, cable, or satellite communication, newspaper, magazine, outdoor advertising facility, mass mailing, or telephone bank to the general public, or any other form of general public political advertising."

The FEC wrote in its rules that "The term public communication shall not include communications over the Internet." This was codified at 11 C.F.R. § 100.26.

Rep. Shays and Rep. Meehan then filed a complaint in the U.S. District Court (DC) challenging many of these regulations. Sen. McCain and Sen. Feingold submitted an amicus curiae brief. (Senate rules prohibited them from being parties.)

The District Court, Judge Colleen Kotelly presiding, overturned 14 parts of the FEC's implementing regulations, including the one regarding internet communications. The Court also held that the Congressmen have standing. See, September 18, 2004 Memorandum Opinion and Order [159 pages in PDF]. This is reported at Shays v. FEC, 337 F.Supp.2d 28 (D.D.C. 2004).

The District Court's decision is significant for technology law, and in particular, for political speech on the internet. The BCRA provides for regulation of certain "public communications"s. The FEC promulgated a rule that provides that "The term public communication shall not include communications over the Internet." But, the District Court held that the FEC lacked authority to do this. Hence, certain internet communications, such as personal blogs, web sites, and e-mail, may be subject to federal regulation under the FECA as "public communication"s. Many individuals and small businesses that engage in internet based speech lack the resources to comply with the FEC's regulatory regime, and hence, face government enforcement actions, and a chilling of their speech.

The purported purpose of the FECA, which has never been accomplished, has been to limit the influence of money in federal elections. Regulation of activities such as individual blogs would have an effect contrary to the purported purpose of the FECA. It would limit political speech and inhibit political participation by many people who do not have the ability to influence elections with money.

The FEC appealed with respect to five of the fourteen overturned rules. However, it did not appeal the portion of the District Court ruling that threatens internet speech.

The FEC issued another notice of proposed rulemaking (NPRM) in March of this year. See, story titled "FEC Approves NPRM on Internet Speech" in TLJ Daily E-Mail Alert No. 1,103, March 25, 2005. See also, stories titled "Bloggers Dodge McCain Feingold Bullet" in TLJ Daily E-Mail Alert No. 1,102, March 24, 2005, "FEC to Consider Rules Regarding Internet Speech" in TLJ Daily E-Mail Alert No. 1,100, March 22, 2005.

The FEC has held a public hearing, but has yet to issue new rules.

Prior Congressional Activity. Several members of Congress also weighed in on this issue in March and April.

On March 17, 2005, Sen. Harry Reid (D-NV), the Senate minority leader, introduced S 678. The entire substance of Sen. Reid's bill is as follows: "Paragraph (22) of section 301 of the Federal Election Campaign Act of 1971 (2 U.S.C. 431(22)) is amended by adding at the end the following new sentence: `Such term shall not include communications over the Internet.´'' That is, it would add to the statute the very language of the regulation that the District Court held was contrary to the FECA.

There are also companion bills in the House, HR 1605 and HR 1606, both introduced by Rep. Jeb Hensarling (R-TX) on April 13, 2005. The second bill adds the titled "Online Freedom of Speech Act".

See also, stories titled "Sen. Reid Introduces Bill to Exempt Internet Communications From Certain FEC Regulation" and "Democratic Representatives Urge FEC Not to Regulate Blogs" in TLJ Daily E-Mail Alert No. 1,101, March 23, 2005.

September Hearing. Rep. Robert Ney (R-OH), the Chairman of the House Administration Committee, discussed the history of the BCRA and the FEC's drafting of regulations in his opening statement.

Rep. Ney stated that "While this new rulemaking was going on, some Members of Congress were making clear that they did not intend for BCRA to cover the Internet, and that they did not want the FEC regulating these communications. In March, Congressman Conyers and 13 of his colleagues wrote to the FEC seeking an exemption for web logs or blogs.

He also noted that the language of Sen. Reid's and Rep. Hensarling's bill "was adopted by this committee, and included in H.R. 1316, the Pence-Wynn bill, reported by the committee on June 8, 2005." HR 1316 is a larger bill that addresses many federal election issues, including Section 527 organizations. The Committee, but not the full House, has approved this bill.

Bradley Smith testified at the hearing. Until last month he had been an FEC Commissioner for five years, and usually its most ardent advocate of freedom of speech. He is now a law professor at Capitol University Law School.

He wrote in his prepared testimony [MS Word] that "What is perhaps most notable about the internet, for our purposes, is that there is probably no other medium by which the average citizen can exercise so much political influence with so little an expenditure of money. There are no barriers to entry in the world of blogging, or in creating email lists. Free software and free websites are available to blog, and a blog can therefore be established by the most amateurish computer user in under an hour, at literally zero cost. The person need not even own a computer or have internet service at his home or workplace -- access to a public library equipped with computers with on-line access will do. If one is truly concerned with reducing the influence of ``big money´´ in politics, then a deregulated internet is, by definition, ``reform.´´"

He argued that "it is clear that if the internet is to remain entirely, or even largely, free from bureaucratic interference, some type of congressional action is required."

He also argued that online speakers are threatened by FEC regulation. He said that "Although few want to say so publicly, there is a sizeable and powerful lobby both in and out of Congress that clearly wants to regulate the internet. Theirs is a stealth campaign, with soothing, moderate rhetoric in highly public settings, but a little probing demonstrates their disdain for the idea of a deregulated on-line community."

He argued that "there are many pitfalls for average citizens hoping to participate in on-line political activity. Moreover, proposals in Congress to remove the internet from the statutory definition of “public communication” are helpful, but do not solve the problem. A broader exemption is necessary."

He also argued that "part of that broader exemption should include clearly extending the press exemption to on-line activity."

Karl Sandstrom (Perkins Coie) wrote in his prepared testimony [MS Word] that "Left to develop on its own the Internet can flourish as a public forum where the force of one's argument counts more than the size of one's pocketbook. Congress and the Commission should provide the space for the Internet to realize its democratic promise. Each should reject the opportunity to become a zoning board of cyberspace and should leave the Internet to function as an open political space where all are invited and all are to be heard."

The Committee also heard from bloggers. See, prepared testimony [MS Word] of Michael Krempasky (Director of and prepared testimony [MS Word] of Duncan Black (of the Eschaton website).

In contrast, Lawrence Noble, of the Center for Responsive Politics, and an advocate of regulating internet speech, wrote in his prepared testimony that "it is a mistake to assume that because political debate can take place on the Internet for very little money, very large undisclosed sums cannot and will not be used to finance political activities on the Internet. There is little doubt that the Internet can be used in much the same way television, radio and the print media have been before; as an avenue for the spending of large amounts of undisclosed soft money to finance various forms of political ads aimed at electing or defeating Federal candidates."

He added that "the potential for quickly becoming another avenue for the use of undisclosed soft money to finance expensive political advertising by candidates, political parties, corporations, labor unions and wealthy individuals seeking to elect and defeat Federal candidates"

See also, the prepared testimony of FEC Commissioners: Scott Thomas, Michael Toner, and Ellen Weintraub.

Disclosure. TLJ publishes information via e-mail and the web regarding, among other things, past and future candidates for federal office. This article references nine: Reid, Hensarling, Ney, McCain, Feingold, Shays, Meehan, Pence and Wynn. The FEC's rules, and Congressional legislation, may affect TLJ. Readers may wish to take this into consideration when assessing the reliability and objectivity of any TLJ stories on this topic.