Maine’s two largest electricity utilities and the two organizations representing the majority of news outlets in the state have filed separate lawsuits in federal court challenging a new voter-approved law that bans foreign government-owned companies from electioneering in referendum campaigns.
The law, proposed as Question 2 on the November ballot, was approved by 86% of Maine voters despite repeated claims by opponents that the prohibition is unconstitutional. The lawsuits filed Tuesday in U.S. District Court largely replicated those objections, centering on alleged violations of the First and 14th amendments of the U.S. Constitution.
One lawsuit was filed by Central Maine Power, the state’s largest electricity provider. While the company said last year that it’s unaffected by the ban, it lobbied against it while the proposal was in the Legislature. It now asserts that the new law seeks to criminalize CMP’s ability to speak publicly on issues relevant to the company’s interests.
“In so doing, the (the law) strikes at the heart of the protections afforded to free expression and political speech guaranteed by the United States Constitution and the Maine Constitution,” the CMP lawsuit asserts.
CMP is owned by Avangrid, a subsidiary of the Spanish energy company Iberdrola. The Qatari government has a nearly 4% stake in Avangrid and owns more than 8% of Iberdrola.
Versant Power, which filed a separate lawsuit, makes similar assertions that the new ban on referendum electioneering violates the company’s right to free speech. Versant Power is owned by ENMAX, a company owned by the city of Calgary, Alberta, a foreign government. Officials for Versant have long acknowledged that the ban would affect its ability to engage in political speech in ballot campaigns.
Versant and CMP spent more than $30 million this year beating back a referendum that proposed seizing the companies’ assets and replacing them with a nonprofit run by an elected board. Had the foreign electioneering ban been in place at the time, Versant would not have been allowed to spend money on campaign ads and advocacy defending its interests.
CMP last year argued that it would not have been subject to the same prohibition, but its lawsuit says supporters of the electioneering ban intended to sideline the company from future campaigns.
The electioneering ban was borne from a contentious transmission project, the New England Clean Energy Connect, advanced by Avangrid and Hydro-Quebec beginning in 2019. A 2021 referendum designed to scuttle the NECEC drew more than $30 million spending from Hydro-Quebec, a company owned by the Quebec government. Hydro-Quebec’s electioneering raised questions about a loophole in state and federal election law that allows foreign government-owned companies to engage in voter persuasion efforts. While foreign governments are not allowed to contribute or spend money to affect candidate campaigns, federal and state law are silent on the issue of electioneering in referendums.
Two efforts to close that loophole were thwarted by Gov. Janet Mills, who vetoed one proposal in 2021 and another this year that would have enacted Question 2 without sending it to voters.
Her veto letter this year largely repeated the utilities’ claims that the proposal is unconstitutional, but it also raised objections to a vague provision that requires news organizations to adopt protocols to make sure that advertisers don’t attempt to skirt the electioneering ban.
The Maine Press Association and Maine Association of Broadcasters objected to the so-called “due diligence” provision, arguing that it effectively deputizes the news organizations in a role that should be handled by government enforcement agencies. Both organizations are now calling for courts to block enforcement of the provision.
“We believe this impending law violates the First Amendment and will have the effect of silencing points of view,” said MAB president Tim Moore in a press statement. “For example, had it been in effect just a month ago, only one side of the campaign to take over the state’s electric utilities would have been heard, because opposing messages would have been illegal for broadcasters to air. Because Mainers heard both sides, they were able to make an informed choice. Besides, being mostly small businesses, broadcasters cannot possibly uncover the ownership structure of potential advertisers. We are not the state’s detective agency.”
Maine Public is a member of MAB, but unlike commercial broadcasters it does not run political advertisements. Paid political advertisements are a significant revenue source for some news organizations.
The 2021 corridor referendum yielded $72 million in campaign spending, much of it through broadcast advertising. Maine Citizens for Clean Elections, which backed Question 2, estimated in October that 83% of this year’s election spending came from foreign government-owned organizations.
The foreign electioneering ban drew support from campaign finance reformers seeking to curb the deluge of spending brought by the U.S. Supreme Court’s 2010 Citizens United ruling that effectively determined that corporations could spend unlimited money on elections because of political speech protections afforded by the U.S. Constitution. Ten states have implemented similar foreign electioneering bans of some kind.
Some of those state laws have been challenged in court. The three lawsuits filed Tuesday mirror that trend.
Protect Maine Elections, the group that introduced and promoted Question 2, described the legal challenges as “outrageous and offensive.”
“The board members of CMP, Versant, the Maine Association of Broadcasters and the Maine Press Association ought to be ashamed of themselves,” said state Sen. Rick Bennett, R-Oxford, chairman of Protect Maine Elections. “These people, many of whom are friends and former colleagues, are enabling foreign governments, and entities that they own, control, and influence, to threaten the integrity of our elections. Maine voters delivered the clearest of messages on Election Day, telling the monied interests and the political class that we are taking our government back. It’s time for these organizations and their governing boards to heed the will of their customers and stakeholders, the people of Maine.”
