Judge won't intervene in suit over $500K donation

HELENA — A federal judge on Friday said he won't intervene in a state lawsuit between Democrat Steve Bullock and Republican Rick Hill over the legality of a $500,000 donation to Hill's campaign for governor.

The ruling is a win for Bullock, the attorney general, who is suing Hill in state court to force the former congressman to return the donation from the Montana Republican Party.

U.S. District Judge Charles Lovell denied a request by conservative groups to find Bullock in contempt for filing the lawsuit. Lovell also denied Hill's request to counter District Judge Kathy Seeley's temporary block preventing Hill from spending the donation before a Monday hearing.

Neither campaign had immediate comment upon learning of the ruling.

At issue are the state's campaign contribution limits that Lovell ruled unconstitutional on Oct. 3. The 9th U.S. Circuit Court of Appeals blocked Lovell's ruling Oct. 9.

Between those dates, the state Republican Party gave Hill the donation. Hill says it was legal for him to take the $500,000 when there were no limits, while Bullock argues he must give it back now that the appeals court has reinstated the $22,600 limit from all political parties.

District Judge Kathy Seeley, a Helena-based state judge, has issued a temporary restraining order that blocks Hill from spending the money or airing ads purchased with it before a Monday hearing.

Conservative groups, businesses and individuals who sued to throw out the campaign contribution limits asked Lovell to find Bullock's lawsuit in contempt of Lovell's order throwing out the contribution limits. They also asked Lovell to force Bullock to pay for ads that restore the damage to Hill's reputation.

Lovell wrote in his order denying that request that his ruling on the limits was not enforceable once the 9th Circuit took action, so Bullock's conduct could not have violated it.

But his denial of the contempt motion should not be interpreted as a determination that the disputed donation was illegal, he wrote.

"That is the question before Judge Seeley," Lovell said.

Hill on Thursday requested Lovell to intervene in the state lawsuit and issue an order countering Seeley's temporary restraining order.

Lovell also denied that request, calling it an attempt to appeal a state court decision to a federal court.

That is "a classically impermissible action" and a federal court can't issue an injunction to stay proceedings in a state court except as authorized by Congress, Lovell wrote.

Lovell said Hill can appeal Seeley's decision or petition the Montana Supreme Court to take control of the case.

"Surely, the Montana Courts will protect the rights of the parties," Lovell wrote.