A federal appeals court Friday wrestled with whether it should unlock a treasure trove of illuminating documents that often reveal the inner workings of political groups.

The Federal Election Commission went to court to defend its 25-year-old practice of making public at the end of a case the thousands of pages of internal documents, records, depositions and other evidence collected by the agency in the course of an investigation of potential violations of election law.

Following a 2001 court ruling won by the AFL-CIO and the Democratic National Committee, the FEC has been locking the files that often reveal interesting details and leads for reporters to follow in monitoring both how the agency enforces the law and examining the way political insiders really operate. Now, the agency reveals only a bare-bones summary of its enforcement decisions, even in cases that generate huge fines.

The AFL-CIO and the DNC were able to block the agency from disclosing more than 50,000 pages of material arising out of an ultimately unsuccessful FEC investigation into alleged improper coordination between the union and Democrats during the 1996 election cycle.

The case pits the right of the public to evaluate the effectiveness of the much-maligned enforcement powers of the FEC against the rights of political participants to shield from public view their most sensitive internal records.

While the Democrats and their strong traditional union ally have spearheaded the drive to shut down what is often described as the “FEC document dump,” their position enjoys support from conservative political groups who have also bitterly objected to what they believe is an intrusive process that can give political opponents an unfair advantage.

The case has added significance with the creation of tough criminal penalties in the new campaign finance law that allows the agency to initiate investigations that may result in serious prison time and other penalties.

The oral argument was potentially intriguing because one of the panel judges, Circuit Judge Karen Henderson, also sits on the three-member tribunal that is readying an anxiously awaited ruling on the constitutionality of the McCain-Feingold campaign finance law. But Henderson, who had to deal with similar questions about the confidentiality of FEC records in that case, uttered not a single word during the hour-long argument.

Instead, the other two panel members, Judges David Tatel and David Sentelle, peppered attorneys representing both the FEC and the AFL-CIO with equally probing questions about the dimensions of the case. Neither of the two judges tipped his hand on how he might eventually rule.

Tatel expressed reservations about the potential First Amendment implications of revealing internal documents, strategies and plans by political groups, which enjoy a high threshold of protection under the constitutional right of free association.

Pointing to a long list of internal union memos, lobbying reports and budget documents collected by the FEC in the course of an ultimately failed investigation, Tatel asked FEC attorney David Kolker if it “is really the position of the commission that those documents enjoy no First Amendment protection?”

Kolker responded that once the documents are in the hands of the FEC, Congress intended to make the files open to public view. And, he contended, in 25 years of the FEC practice, no one has produced evidence that their First Amendment rights had been chilled.

But even more immediate is the question of whether the FEC has properly interpreted Congressional intent in carrying out the disclosure policies of an agency designed to shed light on the political world. The AFL-CIO and the DNC argue that the FEC procedure is arbitrary and capricious, while the FEC contends that Congress’ intent is at best ambiguous.

Federal election law provides that “any notification or investigation made under this section shall not be made public by the Commission or by any person without the written consent of the person receiving such notification or the person with respect to whom such investigation is made.”

The FEC argues that the confidentiality requirement applies only to ongoing cases, which are known in FEC parlance as “matters under review.” But once a case is closed, and the agency either takes enforcement action or does not, the FEC contends it can put all of the records it gathered on the public docket.

The text of the statute “does not specifically address closed cases, and its silence about whether and when the confidentiality requirement expires leaves Congress’ intent on that question ambiguous,” the FEC argued in its brief.

And Congress, the FEC continued, has long been aware of the disclosure practice and has never objected to the policy.

But the AFL-CIO argued that the lower court ruling by U.S. District Judge Gladys Kessler was correct in concluding that the law does not place a time limit on the confidentiality requirement for materials gathered during FEC probes.

The investigation material protected from disclosure under election law “consists of records and information, not just the fact of its existence,” the AFL-CIO argued in its brief.

“What we’re here about is what the term ‘investigation’ means,” noted Sentelle. He said the question to decide is whether the confidentiality provision applies to only ongoing cases.

Assuming that Congress was unclear in writing the statute, Tatel asked AFL-CIO General Counsel Larry Gold whether the FEC interpretation of its disclosure responsibility was nonetheless reasonable.

No, responded Gold, who argued that Congress never intended to have vast amounts of information about the inner workings of political players spread across the public record.

Gold added that the FEC practice creates an incentive for political rivals to file baseless charges against one another just so they can get a look at internal records even if the FEC finds no violation of election law.

“The way the commission interprets the statute, you lose even if you win,” Gold said.

Unmentioned throughout the argument, however, was the fact that 6,000 pages of documents from the FEC investigation of the ties between the federation and Democrats made their way into the hands of reporters and provided a fascinating view into the close working relationship between the two traditional allies. In 2001, the FEC had briefly put the documents on the public record before organized labor objected. But the four days the documents were available was enough time for PoliticalMoneyLine.com to photocopy the entire set of materials and make them available to reporters despite the judge’s injunction against the FEC.

The Associated Press, which obtained the documents, reported in a series of stories how the documents revealed examples of close coordination between Democrats and unions, revealing that union officials often served on party steering committees to help approve or reject Democratic campaign plans.

One conservative watchdog group, the Landmark Legal Foundation, was able to discover an internal audit report that revealed the National Education Association used general treasury funds to support $10.9 million worth of political activity during its 1999 and 2000 fiscal years. The foundation filed a complaint with the Internal Revenue Service charging that the NEA failed to document its political spending on tax returns.

A decision in the case is expected later in the spring.