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Federal Ban on Registered Lobbyists from Advisory Committees to be Reviewed Again

Tuesday, January 21, 2014
Sandler, Travis & Rosenberg Trade Report

The U.S. Court of Appeals for the District of Columbia has sent back to a district court for further consideration a lawsuit challenging an Obama administration policy barring federally registered lobbyists from serving on industry trade advisory committees. The ban was imposed in 2010 to, as President Obama said, reduce the “undue influence of special interests that for too long has shaped the national agenda and drowned out the voices of ordinary Americans.”

The plaintiffs in this lawsuit argue that the ban violates the First Amendment and the equal protection guarantee of the Fifth Amendment by denying the benefit of ITAC service to individuals whose exercise of the right to petition the government triggers the requirement to register with the federal government under the Lobbying Disclosure Act of 1995 (lobbyists not subject to that requirement are not subject to the ban). The government, on the other hand, relies on a 1984 Supreme Court decision that it says (a) allows it to restrict the class of persons to whom it will listen in its making of policy and (b) determined that any pressure such a policy creates on parties to limit their lobbying activities is “constitutionally insignificant.”

The district court dismissed the case, ruling that the plaintiffs were not denied the ability to serve on an ITAC because of anything they expressed, whom they lobbied for or any particular position they advanced on behalf of their clients. Additionally, the court said, while ITAC service confers perquisites that could make the plaintiffs’ lobbying more effective and lucrative (e.g., “special access to government decision-makers and a chance to get the first peek at new policy initiatives”), these are not considered a “valuable government benefit” the receipt of which would be protected from unconstitutional requirements.

The appeals court disagreed, stating that ITAC membership is in fact a government benefit because it is “an especially effective way to affect government policy” that cannot be replaced by alternatives such as public meetings, hearings and trade road shows and thus has value to the plaintiffs. Further, the plaintiffs have made a viable argument that the government has unconstitutionally conditioned their eligibility for this benefit on their willingness to limit their right to petition government (i.e., restricting their lobbying to an extent sufficient to avoid having to register under the Lobbying Disclosure Act). ITACs were created for the very purpose of hearing the views of industry, the court stated, and while the 1984 Supreme Court decision did recognize that the government may choose to hear from some groups at the expense of others, it did not address whether the government may also limit the constitutional rights of those to whom it chooses to listen.

However, the court found that there is insufficient information in the record to determine whether the ban does in fact represent an unconstitutional burden. The Supreme Court has repeatedly upheld government burdens on public employees’ exercise of rights that would be plainly unconstitutional if applied to the public at large, the court noted, and though ITAC service is not public employment, the government’s interest in selecting its advisors implicates similar considerations that may justify similar restrictions. The case has therefore been remanded to the district court for further analysis on this point, and the appeals court urged that the lower court specifically consider (a) the justification for distinguishing between corporate employees (who may represent their employers on ITACs) and the registered lobbyists those same corporations retain (who may not) and (b) how banning registered lobbyists from committees composed of representatives of major corporations protects “the voices of ordinary Americans.”

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