Court allows controversial probe of Walker, conservative groups to resume

FILE: Wisconsin Republican Gov. Scott Walker reacts at his victory party in Waukesha, Wis., after defeating Democratic challenger Tom Barrett in a special recall election. (AP)

A federal appeals court on Wednesday removed one barrier to restarting an investigation into possible illegal coordination between Wisconsin Gov. Scott Walker's campaign and more than two dozen conservative groups, a legal setback for the Republican who is locked in a tough re-election campaign.

The three-judge panel of the 7th U.S. Court of Appeals overturned a lower court ruling that halted the probe, but the judges found state courts are the proper venue to resolve legal issues with the case.

Despite the ruling, the investigation won't resume immediately because the state judge overseeing it also effectively stopped it in January by denying requested subpoenas, saying he didn't believe anything illegal had transpired. The Wisconsin Supreme Court is deciding whether to take the case and has not indicated when it will make a decision.

Speaking to reporters minutes after the ruling, Walker said the appeals court decision "really doesn't matter" because the investigation remains blocked in state court.

Mary Burke, his Democratic opponent in what is considered one of the nation's tightest gubernatorial races, said in a statement that Wisconsin residents "deserve answers to the questions raised by this investigation, which at minimum are very disappointing, and are potentially criminal."

Walker, who is considering a run for president in 2016, made a national name for himself when he took on public sector unions in 2011 with his measure that effectively ended collective bargaining for most public workers. That fight led to the 2012 vote to recall Walker, which he won, making him the first governor in U.S. history to overcome a recall.

Walker has been dogged by secret investigations, first of aides and associates before he became governor and now on his recall campaign and other conservative groups. No one has been charged in the latest probe and prosecutors have said Walker is not a target.

The case largely centers on the type of political activity conducted by the conservative groups during the recall campaign and whether that work required them to follow state laws that bar coordination with candidates, requires disclosure of political donations and places limits on what can be collected.

Douglas S. Knott, an attorney for the prosecutors investigating the case, said in a statement that the appeals court decision "confirms that the rich and powerful are not above the law."

Wisconsin Club for Growth and its director, Eric O'Keefe, filed a federal civil rights lawsuit in February to halt the latest investigation, which began in secret in 2012. They argued it was a violation of their First Amendment rights and an attempt to criminalize political speech.

Wisconsin Club for Growth attorney David Rivkin called Wednesday's ruling disappointing and said the group would ask for the full 7th Circuit to rehear the case.

Randall Crocker, the attorney for lead investigator Fran Schmitz, said the ruling affirmed prosecutors' arguments that the government is entitled to regulate coordination between candidates' campaigns and independent groups.

The three-judge panel also refused to make public eight documents a media coalition had wanted to be unsealed and found that prosecutors and investigators are immune from liability, overturning an earlier ruling.