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Astronomical fine against business group upheld

In 2013, the Grocery Manufacturers Association (GMA), a trade group that represents food companies like Kraft and General Mills, contributed to the opposition campaign of a statewide ballot initiative. Because GMA engages in many other non-political activities, and because GMA was the entity contributing the funds, it believed that the law required these campaign donations to be reported in GMA’s name.

Partway through the campaign, the state Public Disclosure Commission informed GMA that it actually needed to report the contributions in the names of its individual members. GMA quickly amended its reports and made this new, more detailed information available to the public well before the election occurred.

Nonetheless, Attorney General Bob Ferguson sued GMA for violating campaign finance rules, and sought the largest fine in state history. The court eventually levied an $18 million fine. For context, this penalty is 24 times larger than the next largest campaign finance fine in state history, and is nearly six times larger than the sum of all other campaign finance fines in cases brought by the Attorney General over the past decade.

Even more troubling, a liberal group, which contributed to the “pro” campaign of the exact same 2013 initiative, was found to have violated the exact same statute. Yet that left-leaning group was only fined $322,000 and the Attorney General has not sought additional fines.

This week, a state appeals court again upheld the astronomical fine, this time on Eighth Amendment grounds. (Unfortunately, the state Supreme Court already ruled that this fine did not violate the First Amendment, despite the obvious potential for such a large fine to “chill” free speech.) The Eight Amendment prohibits “excessive fines,” and GMA had argued that their $18 million fine was clearly excessive. While the court of appeals disagreed, GMA can now appeal this issue to the state Supreme Court.