A federal appeals court here has upheld a lower court ruling that required newspaper publisher John P. McGoff to obey U.S. government subpoenas issued to help determine whether he secretly used South African money to purchase a chain of U.S. newspapers
McGoff has contended that the subpoenas requested by the Securities and Exchange Commission violated his freedom of speech rights as a publisher. a
But the U.S. Court of Appeals here ruled 3 to 0 on Tuesday that the SEC's investigation of McGoff was concerned with possible violations of federal securities laws and was not related to editorial decisions. Federal securities laws "are not aimed at the press as distinguished from other commercial ventures," Judge Ruth Bader Ginsburg wrote in the decision.
McGoff, a conservative columnist and lecturer who lives in Lansing, Mich., is president of Panax Corp., a publicly registered company that owned 65 newspapers in seven states at the time the SEC began its investigation in 1979.
The SEC probe was prompted by a 1978 South African judicial commission report which revealed McGoff had received $11.3 million from the South African government to purchase The Washington Star and a broadcasting company as part of a South African campaign to improve that nation's public image. A 1974 attempt by McGoff to purchase The Star was unsuccessful.
The SEC is investigating whether McGoff then secretly used the South African money to increase his holdings in the Panax-owned newspaper chain and failed to disclose that as required by U.S. securities laws.
The appeals court ruling affrimed a 1979 decision issued by District Court Judge Gerhard A. Gesell. Subsequent to Gesell's ruling, the SEC reported that McGoff had substantially complied with the SEC's request for subpoenaed documents, but McGoff, who had denied being an agent for the South African government, continued his legal fight.