LAW

Conservatives, after dismantling public financing system, set sights on N.C. judiciary

Third in an occasional series of articles.

The commercial starts like all the political attack ads voters in the swing state of North Carolina are used to seeing: black-and-white graphics, ominous voice-over, newspaper clippings.

In less than 10 seconds, though, the spot takes a striking turn.

"When child molesters sued to stop electronic monitoring of their location, a law that let us track child molesters near schools, playgrounds, day care centers, Supreme Court Justice Robin Hudson sided with the predators," the narrator says over audio of children giggling.

"Justice Robin Hudson, not tough on child molesters."

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Hudson, a Democrat seeking re-election to the state's high court, learned of the ad from a friend's email.

"I was horrified," she recalled. "It was so appalling."

Aside from being misleading and false, the ad signals the next phase in a conservative effort to reshape North Carolina's political institutions (E&E Daily, May 22). The ad attacking Hudson was aired earlier this spring by Justice for All NC, a shadowy conservative group.

Hudson's is one of four Supreme Court seats on the ballot this year (the court has seven seats in all). She faced two challengers in the May 6 primary, including one with little legal experience and ties to Art Pope, the Raleigh multimillionaire and architect of the GOP's takeover of the state Legislature and governor's office.

Hudson emerged from the statewide primary -- Pope's candidate didn't -- but not until more than $1.3 million in outside money was spent to oust her, the most ever on a North Carolina judicial primary. And Hudson will undoubtedly continue to face a barrage of attacks from third-party groups in her general election race against the Republican, Mecklenburg County Superior Court Judge Eric Levinson.

The majority of the primary spending came from Justice for All NC and the North Carolina Chamber of Commerce's independent expenditure arm, both of which have ties to major players in conservative politics.

The North Carolina Chamber counts Koch Industries among its contributors, and Justice for All NC's funding included significant money from the Republican State Leadership Committee, or RSLC, in Washington, D.C.

RSLC's donors include companies with interest in cases that have appeared on the state Supreme Court's docket, including those involving hog lagoons and coastal management. One donor, Duke Energy Corp., was part of a utility rate dispute at the court that North Carolina's leading potential Democratic nominee for governor has seized upon to score political points. Duke, who lost the rate case last year, is one of RSLC's biggest contributors in North Carolina.

More broadly, Hudson's race is indicative of a new focus across the country on judicial elections and a sharp uptick in the amount of money being spent on them. From 2000 to 2009, state Supreme Court candidates raised $206.4 million across the country, more than double the $83.3 million raised in the previous decade, according to an analysis by the liberal group Justice at Stake.

The United States is the only country that elects judges. Nearly 40 states elect at least some and 22 hold contests for appeals court or supreme court posts. Critics, including Hudson, contend that after their success in shaping state legislatures, conservatives are seeking to construct a firewall around new business-friendly, anti-regulatory policies by stacking state courts that may hear challenges to those policies.

RSLC, which was previously dedicated to state legislative elections across the country, launched a new program in April aimed at state judicial races.

The influx in outside spending raises legal and ethical questions. For one, when must a judge recuse himself if a case could affect a company or group that spent money to elect him?

Judges are also fundamentally different than legislators in important ways. Legislators make promises during campaigns and set out to keep them if elected. Judges are tasked with impartially weighing cases brought before them. To be sure, judges are frequently ideological. But in a perfect world they shouldn't have an overt agenda.

"The branches of government don't have the same job," said Bert Brandenburg of Justice at Stake. "No one wants a judge to go out there and make a promise before they have heard the facts and legal arguments presented in a case."

Brandenburg said that judicial elections can provide accountability for sitting judges.

"But if it is hijacked to be used as a tool to pressure judges," he added, "that's not what the election is supposed to be for."

The amount of money flowing into the Hudson race is particularly striking because until last year the state's judicial elections were governed by a public financing program.

In 2002, the Legislature, then controlled by Democrats, passed the North Carolina Judicial Campaign Reform Act, establishing a voluntary program where judicial candidates received money from the state if they abided by spending limits.

From 2004 to 2010 the program was popular. Nearly 80 percent of judicial candidates opted into the system.

"We were a pioneer in protecting the courts from the influence of special interest money," said Bob Hall of the liberal watchdog Democracy North Carolina.

By 2012, though, outside groups were beginning to target judicial races in the state. That year, $3.5 million was spent on a single state Supreme Court race that featured nasty attack ads, including more than $2.8 million from outside groups.

And last year, the Legislature, with the backing of Pope, who now serves as Gov. Pat McCrory's budget director, repealed the program.

Republicans, however, argue that Democrats long controlled the Legislature and had taken steps aside from the public financing system to exert control over judicial elections.

"There is a deep history in this case of both sides being engaged in trying to manipulate the election process," said Paul Shumaker, a campaign consultant for Levinson and most Republican Supreme Court judges.

"The only thing you saw play out in 2014," he added, "is it's no longer party based. It was independent of the party and independent of the candidates."

'They saw an opportunity ... to knock out an incumbent'

After the high spending in 2012, Hudson, a folksy Georgia native who was one of the first women to graduate from Yale, said she thought she was prepared for some nasty attacks in her re-election bid.

The court currently has a 4-3 conservative majority and, even though they are nonpartisan, it is well known which candidates are Democrats and which are Republicans. Because of the makeup of the other three races this year, Republicans will almost certainly retain a majority regardless of the outcome in Hudson's race.

Hudson knew she would face Levinson, who announced he was running last year. Then, on the last day before the filing period closed, Jeanette Doran joined the race, forcing a primary.

Doran is a former general counsel and executive director at the N.C. Institute for Constitutional Law, a group with ties to Pope. Her entrance into the race made it a free for all.

If Hudson came in third in the primary, it would guarantee that a conservative -- either Doran or Levinson -- would win the general election. Without Hudson, there would likely only be one Democrat left on the court's bench.

"It became apparent that I was the only incumbent judge who had a statewide primary," Hudson said. "They saw an opportunity to spend what they view as not a lot of money to knock out an incumbent in the primary."

Republicans were also hoping the Republican primary for the high-profile Senate race held the same day would boost conservative turnout.

Then came the Justice for All NC ad.

The ad refers to a 2010 case on whether a law requiring child molesters to wear electronic monitors could be applied to offenders convicted before the law was enacted.

The court said it could, but Hudson dissented. She argued that the requirement violated the Constitution's ex post facto provisions, which protect against enforcing a law to a crime occurring before the law existed.

It was a well-reasoned dissent based on constitutional interpretation, not "siding" with the child molesters. Richard Vinroot, a well-known North Carolina Republican and former Charlotte mayor, denounced the ad as "despicable."

According to an analysis by the progressive Institute for Southern Studies, Justice for All NC spent almost $800,000 airing the attack ad, which ran nearly 1,200 times in the two weeks before the primary. During that same time period, the institute found, RSLC made a $900,000 contribution to the group.

Justice for All NC isn't required to file disclosure reports until later this summer under state law, so it's impossible to know all of its contributors. Multiple efforts to reach officials with the group were unreturned. RSLC did not respond to an interview request and the North Carolina Chamber of Commerce said in a general statement that its independent expenditure arm decides whether to wade into a race "after carefully evaluating each candidate's professional background, publicly-stated positions on key business issues and voting record (as applicable)."

The North Carolina Chamber Independent Expenditure arm spent $345,000 in support of Levinson and Doran in the primary, according to the Institute's analysis.

Shumaker, Levinson's media consultant, noted, though, that North Carolina has become an increasingly expensive state for buying television air time. While $1.3 million sounds like it a lot, he said it would likely take a lot more to move the needle in a statewide race.

Nevertheless, the ad generated plenty of attention in the press -- so much so, in fact, that some environmentalists in the state say it motivated Democrats and Hudson's backers to turn out to vote. Even Vinroot said he was going to vote for her.

"I think it backfired, without a doubt," said Dan Crawford, a lobbyist with the North Carolina League of Conservation Voters. "There's no place for that in our democracy."

A Duke connection?

Some of the money that the RSLC funneled to Justice for All NC may have come from Duke Energy.

Duke has given RSLC $60,000 this cycle and, in sum, $235,000 since 2011, the sixth most of any North Carolina business, according to the Institute for Southern Studies. (Two tobacco companies -- Reynolds American and the Lorillard Tobacco Co. -- are RSLC's biggest donors in the state, contributing more than $2 million since 2011.)

Duke, though, has at least one good reason to be interested in shaping the state's Supreme Court.

Last year, North Carolina Attorney General Roy Cooper (D) challenged the state utility commission's approval of a Duke rate increase. The utility wanted to implement a 7 percent uptick in rates in January 2012 to pay shareholders and cover the costs of installing pollution controls to comply with new U.S. EPA air regulations. Duke estimated it would cost $2.3 billion for plant modernization and other updates.

The new rate, which went into effect in February 2012, added about $7 to a customer's monthly electric bill. The utility commission approved it, but the attorney general and environmental groups said the commission didn't adequately balance the consumer interests with those of Duke's investors.

The case went to North Carolina's Supreme Court and the justices agreed. In April 2013, it held that the commission failed to adequately weigh the evidence opposing the rate increase and remanded the issue back to the commission.

Since then, the issue has become political. Cooper, the likely Democratic nominee for governor in 2016, has continued to press the case. He has filed another challenge to the same rate increase to the Supreme Court after the commission approved it again.

The litigation presents a contrast between Cooper and Republican Gov. Pat McCrory, a former Duke executive.

Duke officials contend that they and the utility commission have complied with the first court ruling and have justified the rate uptick.

"We believe the Commission's Order satisfies all of the requirements set out by the N.C. Supreme Court and that the Commission properly weighed the evidence," the company said in an April statement.

Chad Eaton, a spokesman for Duke, said the company's PAC does not directly get involved in judicial races.

When asked about the contributions to RSLC, Eaton said the company "participates with a wide array of groups or associations across our six state utility service areas and nationally."

"These relationships," he added in an email, "are intended to represent our customers and shareholders' interests and monitor the development and provide input into their approach to and support for issues at the state and federal level."

He added that the latest rate case will likely be decided before the elections.

"Any pending cases we have before the state Supreme Court will have been settled prior to the outcome of this election in November," he said. "Therefore, there is no bearing."

Integrity of judiciary at stake

Hudson's race also underscores that ethical issues surrounding money and electing judges will only increase in importance.

The federal Supreme Court has weighed in on the issue, and it may again.

In its 2008-2009 term, the justices heard a dispute involving a West Virginia coal executive's involvement in the state's judicial elections.

The case began when a mining company alleged the giant Massey Coal Co. illegally backed out of a supply contract. The company's president, Hugh Caperton, sued, and in 2002 a state court ordered Massey to pay $50 million in damages.

While Massey appealed the case to West Virginia's Supreme Court, its CEO, Don Blankenship, spent $3 million backing a conservative Supreme Court candidate seeking to oust one of its liberal jurists.

The conservative, Brent Benjamin, won and when Massey's case reached the Supreme Court, he voted in the company's favor. Massey won 3-2.

Caperton asked the Supreme Court to take up the case, contending Benjamin should have recused himself.

The high court agreed. In a 5-4 opinion, the court's liberal wing and Justice Anthony Kennedy ruled that Benjamin's conflict of interest was "extreme," leading to the "probability of actual bias."

The ruling did not, however, lay out clear guidelines for when a judge must recuse himself. If Blankenship had only spent $1 million, should Benjamin have sat out the case? The Supreme Court didn't say, leading court watchers to speculate that the issue could return to the court's docket.

Some states are doing more to address the issue. Michigan's Supreme Court, for example, adopted a provision that allows the full bench to overrule a single member's refusal to recuse himself if a formal request is lodged.

Hall, of Democracy North Carolina, said the influx of money will undermine people's faith in the justice system.

"It elevates the suspicion of the public," he said. "The whole judicial system is based on people having confidence that that's where you go for fairness. ... Now you've subjected it to the same political muck and money as the legislative and executive branch."

Hudson echoed that sentiment, saying that the appearance of corruption hits at the very core of a judge's mission.

"We take an oath in which we swear to dispense justice and to be fair and impartial," she said. "Spending money to protect any sort of political agenda -- that's not consistent with our job as judges. Our job is not to have an agenda."

Twitter: @GreenwireJeremy | Email: jjacobs@eenews.net

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