Colorado Supreme Court to hear Ethics Watch case against ‘magic words’ 527s

The Colorado Supreme Court Tuesday agreed to hear a Colorado Ethics Watch case against two 527 groups that the election watchdog group claims circumvented political committee contribution limits by staying away from the so-called “magic words” in campaign ads.

In its first Supreme Court case ever, Ethics Watch is seeking to overturn a lower court ruling siding with the two groups — Senate Majority Fund and the Colorado Leadership Fund.

The two 527s, named after a section of the IRS code, successfully convinced a lower court judge and an the Colorado Court of Appeals that they did not act as political committees when they ran TV and print ads supporting several candidates for the State Legislature in 2008 because those ads didn’t uses the terms “vote for” or “defeat.”

Ethics Watch filed suit in September of 2008 and lost the first round in November of that year (after the general election). The Court of Appeals ruled against Ethics Watch in March of this year.

Ethics Watch Director Luis Toro issued this statement Tuesday:

“We’re pleased that the Colorado Supreme Court has agreed to look at the important question of what counts as an ‘expenditure’ under Colorado law. The implications of this case go beyond just the issue of whether a 527 group can skirt contribution limits simply by avoiding the use of so-called ‘magic words’ like ‘vote for’ or ‘defeat.’ It will also have important implications for disclosure requirements for outside groups that seek to influence state and local elections in Colorado. We are confident that once the Court reviews the case, they will agree with Ethics Watch that the voters who enacted Amendment 27 intended to strengthen Colorado election laws, not lock into place an outmoded ‘magic words’ test that has been described as unworkable and easy to circumvent.”

Amendment 27, among other things, put the campaign violation complaint process in the hands of administrative law judges instead of the partisan and elected secretary of state.

Republican Secretary of State-elect Scott Gessler has been the attorney of record for the Senate Majority Fund since Ethics Watch first filed its suit in 2008. He did not return an email requesting comment, and some critics, including Ethics Watch, are concerned Gessler will continue to try to curtail spending limits and disclosure requirements.

is an award-winning reporter who has covered energy, environmental and political issues for years. His work has appeared in the New York Times, Chicago Tribune and Denver Post. He's founder of Real Vail and Real Aspen.

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