The Arizona Court of Appeals says a 2017 law that makes it a crime to pay people for each signature they collect to qualify voter initiatives for the ballot violates the First Amendment.
The court on Tuesday ordered the first criminal case filed using the law to be dismissed.
The ruling is a major defeat for Attorney General Mark Brnovich.
He charged the state’s largest signature gathering firm in 2020 with 50 misdemeanor criminal counts for bonus programs it used while collecting signatures for Proposition 208.
Petition Partners faced up to $5 million in fines.
Petition Partners denied wrongdoing.
The appeals court said the 2017 law would have a chilling effect on the free speech rights of people trying to get proposed laws on the ballot.