Ethics Board says state Supreme Court opinion on litigation and campaign finance is wrong

With the race to replace Mayor Nutter heating up, the city's Board of Ethics is trying to correct a state Supreme Court ruling that, in part, says litigation fund committees may accept unlimited contributions.

The ethics board said Wednesday that is not accurate. Litigation fund committees, used by candidates for legal defense in election law matters such as petition challenges, must abide by regular campaign contribution limits, the board's executive director Shane Creamer said.

The ethics board filed an application with the state Supreme Court on Dec. 26 asking the court to amend its December opinion regarding political candidates' legal expenses and how it related to campaign finance laws, Creamer announced at Wednesday's board meeting.

"Because the statement in the Court's dicta has already led to confusion and threatens even greater confusion during Philadelphia's busy primary election season in the spring of 2015, the board respectfully requested that the court amend its opinion to correct the misstatement," Creamer said Wednesday.

The state Supreme Court's opinion was the result of a seven-year dispute between the board of ethics and Cozen O'Connor, which represented U.S. Congressman and then-mayoral candidate Bob Brady in a nasty election fight to stay on the ballot (rival candidate Tom Knox tried to kick him off the 2007 primary ballot). The case was dragged through several appeals before the Supreme Court overruled and reversed the lower courts' decisions.

Cozen sued the city's Board of Ethics in 2008, challenging the board's opinion that Brady had to raise the money to pay his legal bills within the limits for mayoral races - $5,000 for individuals and $20,000 for political action committees at the time. Cozen successfully defended Brady, who is also the city's Democratic Party boss, against Knox's effort to get him kicked off the ballot (the one that Nutter ultimately won). The firm forgave the nearly $450,00 worth of legal work.

In an opinion issued in 2012, Court of Common Pleas Judge Leon W. Tucker ruled that forgiveness of a debt "constitutes a 'contribution' " and would be subject to the contribution limits.

Cozen appealed the decision. The state appellate court ruled in favor of the ethics board but on Dec. 15, the state Supreme Court overruled the lower court's decision and said that the law firm can write off the $448,468 debt incurred by Brady in his court battle to stay on the 2007 Democratic primary election ballot for mayor.

This could be a case that is read closely by current and future mayoral candidates. So, the board wants the documents to reflect the city's campaign finance laws, including the limits on the litigation fund committees.

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