IN THE COURT OF APPEALS OF NORTH CAROLINA
No. COA17-569
Filed: 19 June 2018
Wake County, No. 16-CV-003099
THE COMMITTEE TO ELECT DAN FOREST, a political committee, Plaintiff,
v.
EMPLOYEES POLITICAL ACTION COMMITTEE (EMPAC), Defendant.
Appeal by Plaintiff from order entered 15 February 2017 by Judge Allen
Baddour in Wake County Superior Court. Heard in the Court of Appeals 16 October
2017.
Walker Law Firm, PLLC, by David “Steven” Walker, for the Plaintiff-Appellant.
Stevens Martin Vaughn & Tadych, PLLC, by C. Amanda Martin, for the
Defendant-Appellee.
DILLON, Judge.
During the 2012 election cycle, a political advertisement sponsored by the
Employees Political Action Committee (“EMPAC”), the political arm of the State
Employees Association of North Carolina (“SEANC”), ran on television supporting
Linda Coleman, Democratic candidate for Lieutenant Governor. The Committee to
Elect Dan Forest (the “Committee”) commenced this action seeking statutory
damages, contending that EMPAC’s television ad violated the “stand by your ad” law,
which was still in effect during the 2012 campaign cycle.
COMMITTEE TO ELECT DAN FOREST V. EMPAC
Opinion of the Court
The trial court granted summary judgment for EMPAC, concluding that the
law was unconstitutional as applied because Mr. Forest could not forecast any
evidence that he suffered any actual damages, presumably because Mr. Forest won
the election anyway. We reverse the trial court’s order granting summary judgment
and remand the matter for further proceedings consistent with this opinion.
I. Background
In 1999, the General Assembly enacted a “stand by your ad” law, codified in
N.C. Gen. Stat. § 163-278.39A (hereinafter referred to as the “Disclosure Statute”), to
regulate political advertisements. The Disclosure Statute required in relevant part
that any television ad sponsored by a political action committee contain: (1) a
“disclosure statement" identifying the sponsor of the ad spoken by either the sponsor’s
chief executive officer (“CEO”) or its treasurer; and (2) a “full-screen picture
containing [this] disclosing individual” featured during the disclosure statement.
N.C. Gen. Stat. § 163-278.39A(b)(3) and (6) (2012).1
The Disclosure Statute creates the right for a candidate to seek statutory
damages against an ad sponsor who runs a non-conforming ad in the candidate’s race.
N.C. Gen. Stat. § 163.278.39A(f).
1
The Disclosure Statute was repealed by the General Assembly during its 2013 session,
effective 1 January 2014. See Session Law 2013-381, § 44.1. Neither party made any argument
concerning any effect the repeal may have had on the Committee’s right to bring this action; and,
therefore, we do not consider the issue.
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COMMITTEE TO ELECT DAN FOREST V. EMPAC
Opinion of the Court
In 2012, North Carolina’s race for Lieutenant Governor featured two
candidates: Dan Forest and Linda Coleman. EMPAC ran a television advertisement
in support of Ms. Coleman during the 2012 election cycle. There is evidence in the
Record that this ad’s disclosure statement violated the Disclosure Statute in two
different ways: (1) the picture of the disclosing individual was not a “full-screen”
picture, but rather was much smaller; and (2) the disclosing individual depicted in
the ad was neither EMPAC’s CEO nor Treasurer, but was rather Dana Cope, the
then-CEO of EMPAC’s affiliate entity, SEANC.
Mr. Forest’s Committee filed a notice of complaint with the State Board of
Elections (the “SBOE”), whereupon EMPAC pulled the offending ad and ran a new
ad for the remainder of the 2012 election cycle with a disclosure which complied with
the Disclosure Statute. Mr. Forest won the 2012 election for Lieutenant Governor by
a narrow margin of 6,858 votes out of over 4 million votes cast. After the election,
Mr. Forest’s Committee commenced this action seeking statutory damages against
EMPAC for its nonconforming ad supporting Ms. Coleman. The trial court granted
summary judgment to EMPAC. The Committee timely appealed.
II. Condition Precedent
Before addressing the arguments of the parties, we address the argument
raised by our dissenting colleague. Specifically, the Disclosure Statute requires that
in order to preserve the right to bring an action for damages, a candidate’s committee
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COMMITTEE TO ELECT DAN FOREST V. EMPAC
Opinion of the Court
must first “complete and file a Notice of Complaint” with the SBOE regarding the
nonconforming ad no later than three days after the election. N.C. Gen. Stat. § 163-
278.39A(f)(1).2 Our dissenting colleague contends that the Record fails to
demonstrate that the Committee filed a notice of complaint with the SBOE by the
Friday following the 2012 election as required by the Disclosure Statute.
We agree with our dissenting colleague that the requirement to file a notice of
complaint with the SBOE is a statutory “condition precedent” which cannot be
waived; that is, by the terms of the Disclosure Statute, it was a condition precedent
to bringing this matter that Mr. Forest’s Committee first have lodged a complaint
with the SBOE regarding EMPAC’s ad by the Friday following the election. See
Bolick v. American Barmag Corp., 306 N.C. 364, 368-69, 293 S.E.2d 415, 419 (1982).
However, we disagree with our dissenting colleague that the Record lacks sufficient
evidence to create an issue of fact that the Committee satisfied this condition
precedent. Specifically, the Record contains a verified Complaint3 in which the
Committee alleges that it indeed sent a notice of complaint regarding EMPAC’s
nonconforming ad to the SBOE before the election, in late October 2012. Additionally,
the Record contains a copy of this notice of complaint, which was attached as an
2 The Disclosure Statute also requires a complaining candidate to bring the action within
ninety (90) days of the election. Here, there is no dispute that Mr. Forest’s committee brought action
on 28 December 2012, well within ninety (90) days of the election. That action was dismissed pursuant
to Rule 41; however, this present action was commenced within the time required in Rule 41.
3 The Committee’s Complaint was verified by Mr. Forest.
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COMMITTEE TO ELECT DAN FOREST V. EMPAC
Opinion of the Court
exhibit to the verified Complaint. This notice of complaint is dated 26 October 2012,
it states that it is being filed that same day, and it too is verified. There was no other
evidence before the trial court at the summary judgment hearing concerning this
issue; EMPAC never raised the issue at summary judgment nor has EMPAC raised
the issue in its brief on appeal. Accordingly, we conclude that the Record shows that
the Committee met its burden at summary judgment of presenting evidence that it
timely filed a notice of complaint with the SBOE.
We note the dissent’s argument concerning the lack of a file stamp of the SBOE
on the copy of the notice of complaint contained in the Record. We disagree with the
dissent that this lack of a file stamp is fatal to the Committee’s claim. First, the lack
of a file stamp does not bear on our appellate jurisdiction; and therefore, Crowell v.
State, 328 N.C. 563 (1991) and McKinney v. Duncan, ___ N.C. App. ___, ___, 808
S.E.2d 509, 512 (2017), cited in the dissent, are inapposite. It is clear from the Record
that our Court has appellate jurisdiction to consider the trial court’s summary
judgment.
Secondly, the lack of a file stamp was not fatal to the superior court’s
jurisdiction. Though the Committee bears the burden to show that it filed a notice of
complaint with the SBOE within three days of the 2012 election, we note that
providing a filed stamped copy of the notice is not the only way in which the
Committee may meet its burden. Indeed, even the cases cited by our dissenting
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COMMITTEE TO ELECT DAN FOREST V. EMPAC
Opinion of the Court
colleague, State v. High, 230 N.C. App. 330, 750 S.E.2d 9 (2013) and State v. Moore,
148 N.C. App 568, 559 S.E.2d 565 (2002), suggest that producing a file-stamped copy
is not the only means to meet the burden of showing that a document was filed. These
cases stand for the proposition that a trial court lacks jurisdiction to revoke a criminal
defendant’s probation based on a probation violation report which was not filed prior
to the expiration of the defendant’s probation period. In each case, we held that the
State failed to meet its burden to show that the probation violation report was filed
prior to the expiration of the defendant’s probation period. However, we recognized
that presenting a filed-stamped copy was not the only way which the State could have
met its burden. For instance, in High, we vacated the trial court’s order because “the
[violation] reports were not filed stamped, nor [was] there any other evidence in the
record indicating that the reports were actually filed within the period of probation.”
High, 230 N.C. App. at 336, 750 S.E.2d at 14 (emphasis added). And in Moore, we
vacated the trial court’s order, stating that “[i]n the absence of a filed stamped motion
or any other evidence of the motion’s timely filing[,] the trial court is without
jurisdiction.” Moore, 148 N.C. App. 570, 559 S.E.2d at 566 (emphasis added). But in
the matter before us, though the copy of the notice of complaint in the Record lacks
the file stamp of the SBOE, the Record does contain other evidence showing that the
notice of complaint was timely filed with the SBOE, as outlined above.
III. Analysis
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COMMITTEE TO ELECT DAN FOREST V. EMPAC
Opinion of the Court
We now turn to the arguments raised by the parties in their appellate briefs.
In this matter, the trial court granted summary judgment in favor of EMPAC on the
Committee’s claim for statutory damages, concluding that “in the absence of any
forecast of actual demonstrable damages [suffered by Mr. Forest], the statute at issue
is unconstitutional as applied.” In essence, the trial court did not declare the
Disclosure Statute unconstitutional per se, but rather held that Mr. Forest lacked
standing to seek damages under the Statute since he did not suffer any actual
damages, apparently because he won the election.
On appeal, the Committee contends that the trial court erred in its ruling.
EMPAC argues that the trial court correctly determined that the Disclosure Statute
is unconstitutional as applied and further argues that the Disclosure Statute is
unconstitutional on its face. We review these constitutional arguments de novo.
Forbis v. Neal, 361 N.C. 519, 524, 649 S.E.2d 382, 385 (2007) (“The standard of review
for summary judgment is de novo.”); State ex rel. McCrory v. Berger, 368 N.C. 633,
639, 781 S.E.2d 248, 252 (2016) (“We review constitutional questions de novo.”).
A. Dan Forest’s Committee Has Standing To Seek Damages.
The trial court essentially concluded that Dan Forest’s Committee lacked
standing to bring this suit based on the absence of any evidence that Mr. Forest
suffered any actual damage. That is, because Mr. Forest won the 2012 election, he
had no standing, in the constitutional sense, to seek statutory damages allowed under
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COMMITTEE TO ELECT DAN FOREST V. EMPAC
Opinion of the Court
the Disclosure Statute. However, based on controlling precedent, it is clear that Mr.
Forest’s Committee does have standing: simply because Mr. Forest won his election
does not mean that he did not suffer an injury sufficient in a constitutional sense to
confer standing.
The North Carolina Constitution provides in regard to standing as follows:
All courts shall be open; every person for an injury done
him in his lands, goods, person, or reputation shall have
remedy by due course of law; and right and justice shall be
administered without favor, denial, or delay.
N.C. Const. art. I, § 18 (emphasis added). According to our Supreme Court, “[t]he
North Carolina Constitution confers standing on those who suffer harm[,]” Mangum
v. Raleigh Bd. of Adjustment, 362 N.C. 640, 642, 669 S.E.2d 279, 281 (2008), and that
one must have suffered some “injury in fact” to have standing to sue, Dunn v. Pate,
334 N.C. 115, 119, 431 S.E.2d 178, 181 (1993).
Our Supreme Court has held in a variety of contexts that a party has standing
to bring suit where a private right has been breached, even where the party has not
suffered actual damages beyond that fact that a breach occurred. The breach itself
is an “injury in fact.” For instance, one has standing to seek nominal damages “where
some legal right has been invaded but no actual loss or substantial injury has been
sustained. Nominal damages are awarded in recognition of the right and of the
technical injury resulting from its violation.” Potts v. Howser, 274 N.C. 49, 61, 161
S.E.2d 737, 747 (1968). A party to a contract has standing to bring suit where the
8
COMMITTEE TO ELECT DAN FOREST V. EMPAC
Opinion of the Court
other party has breached the contract, even if no actual damage is shown. Kirby v.
Stokes County, 230 N.C. 619, 627, 55 S.E.2d 322, 327 (1949). An owner of land has
the right to exclusive possession of his property and has standing to bring suit against
anyone who trespasses, even where the owner suffers no actual damage; the owner’s
legal right to exclusive enjoyment of his property has been invaded. Hildebrand v.
Southern Bell, 219 N.C. 402, 408, 14 S.E.2d 252, 257 (1941) (holding that a landowner
“is entitled to be protected as to that which is his without regard to its money value”).
If EMPAC had slandered Mr. Forest in its political ad, Mr. Forest would have
had standing to seek at least nominal damages for this tort, even though he won the
election. Wolfe v. Montgomery Ward, 211 N.C. 295, 296, 189 S.E.2d 772, 772 (1937)
(holding that a plaintiff who has been slandered has standing to seek nominal
damages even where there is no evidence that he suffered actual damages).
The private right at issue in the present case was not one that existed at
common law but rather was one created by our General Assembly in the Disclosure
Statute to provide an enforcement mechanism. This private right is a right expressly
conferred by our General Assembly on a candidate to participate in an election where
sponsors of political ads supporting his or her opponent must make themselves known
to the public in their ads. The General Assembly acted within its authority to create
a private right not recognized in the common law:
The legislative branch of government is without question
the policy-making agency of our government, and when it
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COMMITTEE TO ELECT DAN FOREST V. EMPAC
Opinion of the Court
elects to legislate in respect to the subject matter of any
common law rule, the statute supplants the common law
rule[.]
Rhyne v. K-Mart Corp., 358 N.C. 160, 169, 594 S.E.2d 1, 8 (2004). See also Bumpers
v. Cmty. Bank, 367 N.C. 81, 88, 747 S.E.2d 220, 226 (2013) (recognizing our General
Assembly’s authority to prohibit unfair and deceptive trade practices and to create a
private cause of action in favor of a class of individuals to enforce this prohibition).
Our Court has held that a party has standing to sue for statutory damages
without having to demonstrate actual damages where the statute at issue creates a
private cause of action as a mechanism to enforce the provisions of the statute at
issue. See Addison v. Britt, 83 N.C. App. 418, 421, 350 S.E.2d 158, 160 (1986) (Chief
Judge Eagles, joined by future Chief Justice Parker and future Justice Webb, writing
that “[o]nce a violation of an actionable portion of the [Truth In Lending Act] is
established, the debtor is entitled to recover statutory damages [and that b]ecause
the purpose of that section is to encourage private enforcement of the Act, proof of
actual damages is unnecessary”).
Concerning the Disclosure Statute at issue here, in 2012, in an opinion joined
by Judge (now Justice) Beasley, our Court recognized that by enacting the Disclosure
Statute in 1999, the General Assembly made the policy decision to create disclosure
rules in political advertising and to enforce those rules through a “private cause of
action,” by which candidates may seek statutory damages when those rules have been
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Opinion of the Court
broken. Friends of Queen v. Hise, 223 N.C. App. 395, 735 S.E.2d 229 (2012) (footnote
7). The General Assembly expressly created a private right of action for political
candidates and their committees to enforce its policy decision to require that political
television ad sponsors be properly disclosed. It is equally clear that a candidate
suffers an “injury in fact” for a breach, even a technical breach, of this right when an
ad is run in the candidate’s election which runs afoul of the Disclosure Statute. This
“injury in fact” is a breach of a private right similar to a breach of a private right
suffered by a party to a contract who has suffered a breach by the other party to that
contract, or by a landowner whose land has been trespassed upon, or by an individual
who has been slandered. Even though there may not be any other actual damage,
like the loss of an election; the breach of the private right, itself, constitutes an injury
which provides standing to seek recourse.4
We are not to be concerned with the “wisdom or expediency” of the Disclosure
Statute, but rather we are only concerned with whether the General Assembly had
the “power” to enact the law. In re Denial, 307 N.C. 52, 57, 296 S.E.2d 281, 284 (1982).
We conclude that the General Assembly acted within its authority in 1999 when it
enacted the Disclosure Statute to require that political ads disclose their sponsors
4 The United States Supreme Court has recently explained that an “injury in fact” need not be
“tangible” for standing to exist. Spokeo v. Robins, 136 S. Ct. 1540, 1549 (2016). Spokeo addressed the
issue of standing in the federal context. Our Supreme Court has instructed that federal cases may be
instructive, though they are not binding, noting that “the nuts and bolts of North Carolina standing
doctrine are not coincident with federal standing doctrine.” Goldston v. State, 361 N.C. 26, 35, 637
S.E.2d 876, 882 (2006).
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COMMITTEE TO ELECT DAN FOREST V. EMPAC
Opinion of the Court
and to provide the committee of a political candidate running for office with a private
cause of action to seek damages against the sponsor of a nonconforming ad, just as
we conclude that the General Assembly acted within its authority in 2013 to repeal
the law.
B. Dan Forest’s Committee May Seek Statutory Damages Without Showing
Evidence of Actual Damage.
Having concluded that Mr. Forest’s Committee has standing to bring this
action, we now consider whether the Committee may recover the statutory damages
provided under the Disclosure Statute without presenting any evidence that Mr.
Forest suffered any actual monetary damages.
The Disclosure Statute provides that a candidate receiving a favorable verdict
is entitled to statutory damages equal to the “total dollar amount” spent by the ad
sponsor to air the nonconforming ad. N.C. Gen. Stat. § 163-278.39A(f)(2). In this
case, while the exact amount EMPAC spent on the nonconforming ad has yet to be
determined, EMPAC argues that any amount of statutory damages would be an
unconstitutional “windfall” to Mr. Forest’s Committee, since Mr. Forest won the
election. The Committee, though, argues that the statutory damages imposed by the
Disclosure Statute is not unconstitutional “as applied” here even if the Committee
fails to present evidence of actual quantifiable damages.
We conclude that the General Assembly has the authority to provide for
statutory damages and, therefore, that the Committee may seek statutory damages.
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Opinion of the Court
Specifically, our Court has recognized this authority in the context of the Disclosure
Statute. See Friends of Queen, supra. There are other contexts where an award of
statutory damages, without a showing of actual damages, has been sustained. See,
e.g., Simmons v. Kross Lieberman, 228 N.C. App. 425, 431, 746 S.E.2d 311, 315 (2013)
(holding that a party may recover a civil penalty as provided by statute without
showing actual damages for violations of our Debt Collection Act under Chapter 58);
State v. Beckham, 148 N.C. App. 282, 558 S.E.2d 255 (2002) (holding that an award
of statutory damages of $150 under N.C. Gen. Stat. § 1-538.2, where actual damages
shown was less, was civil in nature and appropriate); see also N.C. Gen. Stat. § 25-9-
625(e) (providing that debtors may recover $500 per violation).5
Furthermore, statutory damages which may exceed a plaintiff’s actual
damages are not unconstitutional unless the statutory damage award “prescribed is
so severe and oppressive as to be wholly disproportionate to the offense and obviously
unreasonable.” St. Louis v. Williams, 251 U.S. 63, 66-67 (1919). Our Supreme Court
has recognized this principle. N.C. School Board v. Moore, 359 N.C. 474, 496-97, 614
S.E.2d 504, 517-18 (2004) (recognizing the principle that “rough justice, not absolute
5 In the federal context, there are a number of situations where a plaintiff may recover
statutory damage relief without any showing of actual damages: the Copyright Act (17 U.S.C. § 504(c))
which allows a plaintiff to recover between $750 and $30,000 for each act of infringement instead of
actual damages; the Cable Piracy Act (47 U.S.C. § 605(e)) which allows a plaintiff to recover between
$1,000 and $10,000 in lieu of actual damages; the Anti-Cybersquatting Consumer Protection Act (15
U.S.C. § 1125(d)) which allows a plaintiff to recover between $1,000 and $100,000 from any person
who registers in bad faith a domain name that is confusingly similar to the plaintiff’s distinctive mark;
and the Fair Debt Collection Practices Act of 1978 (15 U.S.C. § 1692k(a) which allows plaintiffs to
recover from debt collectors as much as $1,000 per violation of the Act’s requirements.
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Opinion of the Court
precision, was sufficient in evaluating the amount of [statutory] damages so long as
the amount of the penalty was not severely disproportionate [to the actual
damages]”).
Therefore, we conclude that the Committee need not put forth evidence of
actual damages in order to seek statutory damages. Such is not required in other
contexts where statutory damages are allowed. However, we recognize that there
may be situations where an award of statutory damages might be unconstitutionally
excessive and would need to be reduced. For example, if a political action committee
spent $1 million running an ad which did not feature the picture of the disclosing
individual until a second after the disclosure statement commenced (where the
Disclosure Statute requires the picture be displayed “throughout the duration of the
disclosure statement”), an award of $1 million might be deemed unconstitutionally
excessive. Such an award may be viewed as “oppressive” and “wholly
disproportionate” to such a minor technical violation, and it might be appropriate to
reduce such award.
But, here, it could be argued that EMPAC’s violation was more substantial.
Specifically, it is possible that having Dana Cope, a then-popular executive director
of EMPAC’s affiliate entity, SEANC, shown as the disclosing individual may have
given the ad a level of gravitas that it would not have enjoyed if an unknown officer
of EMPAC had been depicted. We conclude, however, that it is premature to decide
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Opinion of the Court
whether the statutory damages allowed under the Disclosure Statute would be
unconstitutionally excessive in this case, as the amount of statutory damages, if any,
has yet to be determined.
C. The Disclosure Statute is Facially Constitutional.
(First Amendment Challenge)
EMPAC argues, as an alternate legal ground to support the trial court’s
summary judgment, that the Disclosure Statute is unconstitutional on its face.
Specifically, EMPAC contends that the Disclosure Statute constitutes a content-
based restriction on speech, in violation of the First Amendment, because it requires
that political ads contain a disclosure, while not requiring other forms of
advertisement to contain a disclosure. We must disagree. Specifically, the United
States Supreme Court has expressly held that a law requiring a disclaimer or a
disclosure identifying the sponsor of a political ad is not a content-based restriction
on speech requiring strict scrutiny review. Citizens United v. FEC, 558 U.S. 310, 366
(2010) (“Disclaimer and disclosure requirements . . . ‘do not prevent anyone from
speaking.’”) (quoting McConnell v. FEC, 540 U.S. 93, 201 (2003)). Rather, the Court
held that such laws limit only the manner of speech and are, therefore, subject only
to “exacting scrutiny” review. Citizens United, 558 U.S. at 366. And we are bound
by that determination.
To survive “exacting scrutiny” review, which is generally considered to be
synonymous with “intermediate scrutiny” review, the law “need not [provide] the
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Opinion of the Court
least restrictive or least intrusive means” of reaching a government objective. Ward
v. Rock Against Racism, 491 U.S. 781, 784 (1989). Rather, there need only be a
“substantial relation” between the law and a “sufficiently important” governmental
interest. Citizens United, 558 U.S. at 366-67.
In Citizens United, the Court found that a law requiring disclosures in political
advertising can survive “exacting scrutiny” review “based on a governmental interest
in ‘provid[ing] the electorate with information’ about the sources of election-related
spending,” Id. at 367, and that such disclosures “permit[] citizens and shareholders
to react to the speech of corporate entities in a proper way, [which] enables the
electorate to make informed decisions and give proper weight to different speakers
and messages,” Id. at 371.
The Disclosure Statute here, requiring a sponsor’s CEO or treasurer read a
short disclaimer while his or her picture is displayed, is similar to and not any more
onerous than the statute sustained by the United States Supreme Court in Citizens
United, a statute which required that political ads contain a disclosure statement
which:
[M]ust be made in a “clearly spoken manner,” and
displayed on the screen in a “clearly readable manner” for
at least four seconds. It must state that the communication
“is not authorized by any candidate or candidate's
committee”; it must also display the name and address (or
Web site address) of the person or group that funded the
advertisement.
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Opinion of the Court
Id. at 366. EMPAC’s argument concerning the facial validity of the Disclosure
Statute is, therefore, overruled.
IV. Conclusion
This matter involves the partisan political process. And there is an element of
political irony; a Republican invoking a law passed by a Democratic-controlled
General Assembly and later repealed by a Republican-controlled General Assembly.
However, our job is not to consider the politics of the parties involved. Rather, our
job is simply to apply the law, irrespective of politics.
Applying the law, we must conclude that our General Assembly acted within
its authority in 1999 when it enacted the Disclosure Statute, creating a private cause
of action in favor of political candidates against the sponsors of political ads who fail
to properly disclose their identity, just as the General Assembly acted within its
authority when it took away this statutory right in 2013. Therefore, we must
conclude that the trial court erred in granting summary judgment in favor of EMPAC.
We reverse the order of the trial court and remand the matter for further proceedings
consistent with this opinion. In so ordering, we note that whether the Disclosure
Statute is unconstitutional as applied because the amount of statutory damages
allowed thereunder is unconstitutionally excessive is not before us since the amount
of statutory damages has yet to be determined in this case.
REVERSED AND REMANDED.
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Opinion of the Court
Judge CALABRIA concurs.
Chief Judge McGEE dissents.
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No. COA17-569 – Committee To Elect Dan Forest v. EMPAC
McGEE, Chief Judge, dissenting.
Because I believe this Court lacks subject matter jurisdiction over the appeal,
I respectfully dissent. This Court lacks jurisdiction to consider Plaintiff’s appeal for
two reasons: (1) Plaintiff has failed to demonstrate that it had standing to initiate
this action, and (2) Plaintiff has failed to prove that it met a condition precedent
required for the trial court to obtain subject matter jurisdiction.
I. Standing
Plaintiff failed in its burden of demonstrating that it had standing to bring the
present action. Because I believe the necessary elements of standing, as set forth in
the appellate opinions of this State, are based on rights and protections guaranteed
by the North Carolina Constitution, I do not believe the General Assembly is
empowered to confer standing on plaintiffs that have not alleged any actual harm.
The majority opinion repeatedly states its assumption that the trial court
based its ruling on a determination that “because Dan Forest won his election . . . he
did not suffer an injury sufficient in a constitutional sense to confer standing.”
However, the trial court did not reference the outcome of the election anywhere in its
order – it simply stated that “Plaintiff has failed to allege any forecast of damage
other than speculative damage.” More importantly, the reasoning of the trial court
is not relevant to our standing review. My analysis is based solely upon the
allegations in Plaintiff’s 9 March 2016 Complaint (“Plaintiff’s Complaint”).
COMMITTEE TO ELECT DAN FOREST V. EMPAC
McGEE, C.J., dissenting
“No person shall be . . . in any manner deprived of his . . . property, but by the
law of the land.” N.C. Const. art. I, § 19. “[U]nder the law of the land clause of the
State Constitution a judgment of a court cannot bind a person unless he is brought
before the court in some way sanctioned by law[.]” Eason v. Spence, 232 N.C. 579,
586, 61 S.E.2d 717, 722 (1950) (citations omitted). “All courts shall be open; every
person for an injury done him in his lands, goods, person, or reputation shall have
remedy by due course of law[.]” N.C. Const. art. I, § 18. “As a general matter, the
North Carolina Constitution confers standing on those who suffer harm[.]”
Willowmere Cmty. Ass’n v. City of Charlotte, __ N.C. __, __, 809 S.E.2d 558, 561 (2018)
(quoting art. I, § 18 and Mangum v. Raleigh Bd. of Adjust., 362 N.C. 640, 642, 669
S.E.2d 279, 281 (2008)) (emphasis added). Therefore, the North Carolina
Constitution does not confer standing on those who have not suffered harm. Id.
In order to establish standing to bring this action based on violations of N.C.
Gen. Stat. § 163-278.39A, Plaintiff was required to meet two separate burdens: (1)
prove that it was a party authorized to bring the action pursuant to the requirements
of the statute itself, see, e.g., Applewood Props., LLC v. New S. Props., LLC, 366 N.C.
518, 522–24, 742 S.E.2d 776, 779-80 (2013), and (2) prove that it met the general
constitutional standing requirements as determined by our appellate courts. See,
e.g., Carcano v. JBSS, LLC, 200 N.C. App. 162, 175, 684 S.E.2d 41, 52 (2009); Coker
v. DaimlerChrysler Corp., 172 N.C. App. 386, 390–91, 617 S.E.2d 306, 310 (2005),
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McGEE, C.J., dissenting
aff’d per curiam, 360 N.C. 398, 627 S.E.2d 461 (2006). “Since standing is a
jurisdictional requirement, the party seeking to bring [its] claim before the court must
include allegations which demonstrate why [it] has standing in the particular case[.]”
Cherry v. Wiesner, __ N.C. App. __, __, 781 S.E.2d 871, 877, disc. review denied, 369
N.C. 33, 792 S.E.2d 779 (2016) (citations omitted). The allegations in Plaintiff’s
complaint were sufficient to meet Plaintiff’s first burden, but insufficient to meet its
second.
North Carolina courts are not constitutionally bound by the standing
jurisprudence established by the United States Supreme Court. See, e.g., Cedar
Greene, LLC v. City of Charlotte, 222 N.C. App. 1, 17, 731 S.E.2d 193, 204–05 (2012),
rev’d, 366 N.C. 504, 739 S.E.2d 553 (2013) (adopting Court of Appeals dissent in
appeal from declaratory action challenging constitutionality of a statute); but see
Dunn v. Pate, 334 N.C. 115, 119, 431 S.E.2d 178, 181 (1993) (citation omitted) (Our
Supreme Court, in determining the issue of standing in a constitutional challenge to
a statute, stated: “The [Court of Appeals] correctly stated that the petitioner ‘must
allege she has sustained an “injury in fact” as a direct result of the statute to have
standing.’”). However, since at least the 1960s, our courts, both trial and appellate,
have applied requirements established by the United States Supreme Court to the
standing jurisprudence of this State. See, e.g., id.; River Birch Assocs. v. City of
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McGEE, C.J., dissenting
Raleigh, 326 N.C. 100, 129, 388 S.E.2d 538, 555 (1990); Stanley v. Dept. Conservation
& Development, 284 N.C. 15, 28, 199 S.E.2d 641, 650 (1973).
When this Court or our Supreme Court adopts a standard from another
jurisdiction and applies that standard in order to decide an issue before it, that
standard becomes part of the holding, and part of the law of this State. Therefore,
though standing requirements set by the United States Supreme Court are not
inherently binding on this Court, they become binding once adopted and applied by
our appellate courts in order to decide an issue. Both this Court and our Supreme
Court have adopted and applied federal standing requirements for decades, and this
Court is bound by those adopted standards as much as it is bound by the common law
standards that developed independently in this State.6
When discussing the underlying requirements for demonstrating standing in
regular civil actions, this Court has repeatedly held that
[t]he irreducible constitutional minimum of standing [is]:
(1) “injury in fact” – an invasion of a legally protected
interest that is (a) concrete and particularized and (b)
actual or imminent, not conjectural or hypothetical; (2) the
injury is fairly traceable to the challenged action of the
defendant; and (3) it is likely, as opposed to merely
speculative, that the injury will be redressed by a favorable
decision.
6 I refer only to standards found in opinions with precedential value, and to those standards
that constitute holdings in that the application of the standard was “necessary to the decision.” See
Trustees of Rowan Tech. v. Hammond Assoc., 313 N.C. 230, 242, 328 S.E.2d 274, 281 (1985) (citations
omitted) (distinguishing holdings from obiter dictum by stating: “Language in an opinion not necessary
to the decision is obiter dictum and later decisions are not bound thereby.”).
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McGEE, C.J., dissenting
Teague v. Bayer AG, 195 N.C. App. 18, 22, 671 S.E.2d 550, 554 (2009) (citations and
quotation marks omitted). Because federal constitutional standards do not dictate
standing requirements in North Carolina, the “irreducible constitutional minimum”
discussed in Teague and other opinions must logically refer to the minimum
requirements of the North Carolina Constitution. See N.C. Const. art. I, § 18;
Willowmere, __ N.C. at __, 809 S.E.2d at 561. Our Supreme Court has recognized
“injury in fact” as a required element of standing in opinions filed both prior and
subsequent to Cedar Greene. See Hart v. State, 368 N.C. 122, 140, 774 S.E.2d 281,
293–94 (2015); Empire Power Co. v. N.C. Dept. of E.H.N.R., 337 N.C. 569, 590, 447
S.E.2d 768, 780–81 (1994).
A recent United States Supreme Court opinion, Spokeo, Inc. v. Robins, __ U.S.
__, 194 L. Ed. 2d 635 (2016), addressed the issue presently before us – whether
standing can be created by statute for plaintiffs that cannot meet the general
constitutional standing requirements. In Spokeo, the Court held that the plaintiff’s
burden to prove injury-in-fact cannot be abolished by statute. Id. at __, 194 L. Ed. 2d
at 646 (citations omitted). The Court held: “Injury in fact is a constitutional
requirement, and ‘[i]t is settled that Congress cannot erase Article III’s standing
requirements by statutorily granting the right to sue to a plaintiff who would not
otherwise have standing.’” Id. at __, 194 L. Ed. 2d at 643-44. The injury-in-fact
standard applied in Spokeo is the same that this Court applies: “‘To establish injury
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McGEE, C.J., dissenting
in fact, a plaintiff must show that he or she suffered ‘an invasion of a legally protected
interest’ that is ‘concrete and particularized’ and ‘actual or imminent, not conjectural
or hypothetical.’” Spokeo, __ U.S. at __, 194 L. Ed. 2d at 644 (citation omitted). “For
an injury to be ‘particularized,’ it ‘must affect the plaintiff in a personal and
individual way.’” Id. (citations omitted). “Particularization is necessary to establish
injury in fact, but it is not sufficient. An injury in fact must also be ‘concrete.’” Id.
“A ‘concrete’ injury must be ‘de facto’; that is, it must actually exist. When we have
used the adjective ‘concrete,’ we have meant to convey the usual meaning of the term
– ‘real,’ and not ‘abstract.’” Id. at __, 194 L. Ed. 2d at 644-45 (citations omitted);
compare Teague, 195 N.C. App. at 22, 671 S.E.2d at 554. The “de facto” requirement
is also recognized by this Court. See Coker, 172 N.C. App. at 391–92, 617 S.E.2d at
310 (citations omitted) (emphasis removed) (defining “injury in fact” as an injury that
is “concrete and particularized and . . . actual or imminent, not conjectural or
hypothetical[,]” “distinct and palpable” and not “abstract”).
In Spokeo, the Court recognized that “the violation of a procedural right
granted by statute can be sufficient in some circumstances to constitute injury in
fact[,]” Spokeo, __ U.S. at __, 194 L. Ed. 2d at 646 (emphasis added), but that “does
not mean that a plaintiff automatically satisfies the injury-in-fact requirement
whenever a statute grants a person a statutory right and purports to authorize that
person to sue to vindicate that right.” Id. at __, 194 L. Ed. 2d at 645. The Court held
6
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McGEE, C.J., dissenting
that because the Ninth Circuit failed to consider whether violation of the specific
procedures alleged in Robins’ complaint constituted a sufficiently concrete harm,
remand was required.
On the one hand, Congress plainly sought to curb the
dissemination of false information by adopting procedures
designed to decrease that risk. On the other hand, Robins
cannot satisfy the demands of Article III by alleging a bare
procedural violation [because] violation of . . . FCRA’s
procedural requirements may result in no harm.
Id. at __, 194 L. Ed. 2d at 646 (emphasis added). The Court held that the relevant
analysis was “whether the particular procedural violations alleged in this case entail
a degree of risk sufficient to meet the concreteness requirement.” Id. (emphasis added).
Stated differently:
[A]n alleged procedural violation can by itself manifest
concrete injury where Congress conferred the procedural
right to protect a plaintiff’s concrete interests and where
the procedural violation presents a “risk of real harm” to
that concrete interest. But even where Congress has
accorded procedural rights to protect a concrete interest, a
plaintiff may fail to demonstrate concrete injury where
violation of the procedure at issue presents no material risk
of harm to that underlying interest.
Strubel v. Comenity Bank, 842 F.3d 181, 190 (2d Cir. 2016) (citing and paraphrasing
Spokeo). In the wake of Spokeo, multiple federal jurisdictions have held that minor
or technical violations of statutes do not satisfy the injury-in-fact requirement. See,
e.g., Dreher v. Experian Info. Sols., Inc., 856 F.3d 337, 346 (4th Cir. 2017) (“As Spokeo
demonstrated, a statutory violation absent a concrete and adverse effect does not
7
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McGEE, C.J., dissenting
confer standing.”); Kleg v. SP Plus Corp., 2018 WL 1807012 (N.D. Ga. Mar. 5, 2018)
(including thorough review of federal district and circuit courts that have found no
standing for non-injurious statutory violations). I believe the North Carolina
Constitution requires the same level of particularization and concreteness with
regard to statutory violations.7 See, e.g., Empire Power, 337 N.C. at 590, 447 S.E.2d
at 780–81 (citation omitted) (emphasis added) (“the ‘procedural injury’ implicit in the
failure of an agency to prepare an environmental impact statement was itself a
sufficient ‘injury in fact’ to support standing as an ‘aggrieved party’ under former
N.C.G.S. § 150A–43, as long as such injury was alleged by a plaintiff having sufficient
geographical nexus to the site of the challenged project that he might be expected to
suffer whatever environmental consequences the project might have.”).
In the present case, Plaintiff argues, and the majority opinion agrees, that
allegation of a “bare procedural violation” of N.C.G.S. § 163-278.39A was sufficient to
confer standing. Plaintiff contends in its reply brief: “In light of [N.C.G.S. § 163-
278.39A], the General Assembly has declared that a candidate has been injured when
an opposing organization fails to follow advertising disclosure laws. Thus, there is
injury in fact [in this case.]” Plaintiff further contends that because the General
Assembly created a private cause of action as the enforcement mechanism for
N.C.G.S. § 163-278.39A, the General Assembly eliminated the need to show “actual
7 In contrast, the majority opinion holds that “even a technical breach” of N.C.G.S. § 163-
278.39A constitutes a per se injury in fact.
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McGEE, C.J., dissenting
demonstrable damages:” “[W]hen [the General Assembly] created [N.C.G.S.] § 163-
278.39A (2011), by modifying the common law requirement that actual damages must
be demonstrable, it provided a different way to calculate otherwise incalculable actual
damages.” To the extent, if any, that Plaintiff is using “damages” to mean “injury,”
conflating these terms is incorrect. “[T]he term ‘wrong’ has a legal signification
distinct from ‘damage,’ and is synonymous with ‘injuria’ – signifying a legal injury –
hence the maxim damnum absque injuria, which ‘is used to designate damage which
is not occasioned by anything which the law esteems an injury.’” Thomason v. R. R.,
142 N.C. 318, 330, 55 S.E. 205, 209–10 (1906) (citations omitted). It was evidence of
injury, not damages, that Plaintiff was required to properly plead in order to confer
standing.
The General Assembly unquestionably has the authority to supplant common
law through legislation. However, I do not agree that this State’s standing
requirements are susceptible to abrogation through legislative enactments – they are
the minimum constitutional requirements a plaintiff must satisfy in order to force a
defendant into court. Mangum, 362 N.C. at 642, 669 S.E.2d at 281-82; see also N.C.
Const. art. I, §§ 18 and 19; N.C. Const. art. IV, § 1 (“The General Assembly shall have
no power to deprive the judicial department of any power or jurisdiction that
rightfully pertains to it as a co-ordinate department of the government[.]”); City of
Asheville v. State of N.C., 369 N.C. 80, 88, 794 S.E.2d 759, 766 (2016) (citations and
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McGEE, C.J., dissenting
quotation marks omitted) (“[i]f there is a conflict between a statute and the
Constitution, this Court must determine the rights and liabilities or duties of the
litigants before it in accordance with the Constitution”).
I cannot locate any other enactment by the General Assembly that has created
a private right of action conferring standing on a plaintiff without requiring any
showing of a particularized and concrete injury proximately caused by an act of the
defendant. For example, N.C. Gen. Stat. § 75-16 (2017) of our Unfair and Deceptive
Practices Act specifically requires an allegation of injury, and this Court has held that
a plaintiff must allege facts in support of both the standing requirements created by
the legislation, and the constitutional requirements for standing. Coker, 172 N.C.
App. at 391, 401, 617 S.E.2d at 310, 316, aff’d per curiam, 360 N.C. 398, 627 S.E.2d
461.
In Friends of Queen, this Court recognized the peculiarity of the use of a private
cause of action as an enforcement mechanism for violations of N.C.G.S. § 163-
278.39A:
The enforcement mechanism chosen by our legislature is
unique in the world of election law. Many other
jurisdictions have analogous disclosure laws. However,
after diligent searching, it appears that North Carolina has
the only statute that provides candidates with a private
cause of action against their opponents for advertising
disclosure violations, rather than enforcement through
government-enforced criminal or civil penalties.
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McGEE, C.J., dissenting
Friends of Joe Sam Queen v. Ralph Hise for N.C. Senate, 223 N.C. App. 395, 403 n.7,
735 S.E.2d 229, 235 n.7 (twelve citations to statutes from different jurisdictions
omitted) (emphasis added). It is this unprecedented use in N.C.G.S. § 163-278.39A
of a private cause of action to enforce what was essentially a public right to
information that is responsible for the unique standing issue now before us. As
suggested by Friends of Queen, 223 N.C. App. at 403 n.7, 735 S.E.2d at 235 n.7, it is
the State, not private entities, that has the superior interest in enforcing public
rights, and the inherent standing to do so.
I do not agree that N.C.G.S. § 163-278.39A was enacted to create or enforce “a
political candidate’s right to participate in a campaign where sponsors of political ads
supporting his or her opponent must make themselves known to the public in their
ads.” The majority opinion suggests that N.C.G.S. § 163-278.39A was intended to
create a private, rather than public, right. If this were true, it would represent a
complete break with the traditional state interests motivating the enactment of
disclosure statutes, and would raise concerning constitutional questions. Political
disclosure laws have been enacted, and constitutionally justified, as a means to
enforce the public’s right to access relevant information concerning political
candidates. In fact, it is this governmental interest in ensuring an informed
electorate that serves to provide constitutional justification for the coincident
invasion of First Amendment rights associated with political disclosure statutes:
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McGEE, C.J., dissenting
In this case, the state interest at stake is that of
“provid[ing] the electorate with information as to where
political campaign money comes from and how it is spent.”
Buckley, 424 U.S. at 66, 96 S.Ct. 612 (internal quotation
marks omitted). This “informational interest” is
sufficiently important to support disclosure requirements.
In Buckley, the Court recognized that campaign finance
disclosure was a critical tool for maintaining transparency
in the political marketplace: “In a republic where the
people are sovereign, the ability of the citizenry to make
informed choices among candidates for office is essential,
for the identities of those who are elected will inevitably
shape the course that we follow as a nation.” Disclosure
requirements advance the public’s interest in information
by “allow[ing] voters to place each candidate in the political
spectrum more precisely than is often possible solely on the
basis of party labels and campaign speeches.” By revealing
“the sources of a candidate’s financial support,” disclosure
laws “alert the voter to the interests to which a candidate
is most likely to be responsive and thus facilitate
predictions of future performance in office.”
Ctr. for Individual Freedom v. Madigan, 697 F.3d 464, 477–78 (7th Cir. 2012)
(citations omitted); see also State v. Wright, 206 N.C. App. 239, 243, 696 S.E.2d 832,
836 (2010) (“the whole purpose of the campaign finance laws is to make the
information available to the public at all times for voters’ review”). It is at least in
question whether the majority opinion’s stated interpretation of N.C.G.S. § 163-
278.39A – that it created a private right for the political candidates themselves
instead of a public right for the electorate – would serve to justify the countervailing
First Amendment rights involved. See, generally, Davis v. FEC, 554 U.S. 724, 744,
171 L. Ed. 2d 737, 754-55 (2008). Although N.C.G.S. § 163-278.39A created a private
12
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McGEE, C.J., dissenting
cause of action, that cause of action was created to protect a public, not private, right
– the right to insure an informed electorate. Under federal standing jurisprudence,
“Congress cannot authorize private plaintiffs to enforce public rights in their own
names, absent some showing that the plaintiff has suffered a concrete harm
particular to him.” Spokeo, __ U.S. at __, 194 L. Ed. 2d at 650 (Justice Thomas
concurring).8 I would hold that no less requirement should be applied here.
The majority opinion holds: “It is . . . clear that a candidate suffers an ‘injury
in fact’ for a breach, even a technical breach, . . . when an ad is run which runs afoul
of the Disclosure Statute.” Though “intangible” injuries, such as violations of
fundamental rights, can confer standing to pursue a statutorily created cause of
action, it is only those intangible injuries that meet minimum constitutional
requirements that can do so. Spokeo, __ U.S. at __, 194 L. Ed. 2d at 646. Neither
Plaintiff, nor the majority opinion, indicates which allegations in Plaintiff’s complaint
meet the minimum requirements set forth in Hart, 368 N.C. at 140, 774 S.E.2d at
293–94, Teague, 195 N.C. App. at 22, 671 S.E.2d at 554, or any other appellate opinion
of this State. I can identify no allegation of any harm in Plaintiff’s complaint that is
“de facto,” or otherwise “real, and not abstract,” “conjectural or hypothetical.” Coker,
172 N.C. App. at 391–92, 617 S.E.2d at 310. Nor can I identify how the alleged
8 For an in depth review of the differing standing requirements attached to “private” and
“public” rights, see Spokeo, __ U.S. at __, 194 L. Ed. 2d at 647-50.
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McGEE, C.J., dissenting
violations constitute a particularized harm that “‘affect[s] [P]laintiff in a personal and
individual way.’” Spokeo, __ U.S. at __, 194 L. Ed. 2d at 644 (citation omitted).
There is nothing inherently injurious to Plaintiff that flows from Defendant’s
alleged violations of N.C.G.S. § 163-278.39A. Plaintiff’s two allegations are that
Defendant failed to include in its television advertisement “an unobscured, full-
screen picture containing the disclosing individual, either in photographic form or
through the actual appearance of the disclosing individual on camera, . . . featured
throughout the duration of the disclosure statement[,]” and that the disclosure
statement was not “spoken by the chief executive officer or treasurer of the political
action committee[.]” Plaintiff’s own argument on appeal illustrates the “abstract or
conjectural or hypothetical” nature of any potential injury suffered by Plaintiff.
Plaintiff states: “It is difficult to prove whether the offending advertisements closed
the electoral gap and led to [Plaintiff] being required to hire a legal team to monitor
provisional vote counting and prepare for the possibility of a recount.” Whether the
advertisements were in some general sense effective in “closing the electoral gap” is,
of course, irrelevant. In order to make an argument of relevance, Plaintiff would have
had to allege that the manner in which the alleged violations of N.C.G.S. § 163-
278.39A altered the television advertisement negatively impacted Plaintiff’s campaign
in some tangible manner, or otherwise resulted in actual injury. However, Plaintiff’s
complaint failed to allege even this hypothetical injury.
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McGEE, C.J., dissenting
The majority opinion cites Kirby v. Board of Education, 230 N.C. 619, 55 S.E.2d
322 (1949), Hildebrand v. Telegraph Co., 219 N.C. 402, 14 S.E.2d 252 (1941), and
Wolfe v. Montgomery Ward & Co., 211 N.C. 295, 189 S.E. 772 (1937), for the
proposition that violations of N.C.G.S. § 163-278.39A(3) and (6) constituted injury
sufficient to confer standing, because “a party has standing to bring suit where a
private right has been breached, even where the party has not suffered actual
damages beyond the fact that a breach occurred.” As argued above, I believe N.C.G.S.
§ 163-278.39A(3) and (6) created public rights, not any private rights in Plaintiff (or
in Mr. Forest). Further, damages and injury are not synonymous, and the well-
established common law causes of action at issue in Kirby, Hildebrand, and Wolfe –
breach of contract, trespass, and slander – are in no manner similar to violations of
the (then) newly created statutory provisions of N.C.G.S. § 163-278.39A. In certain
instances, an allegation that a defendant committed a particular tort is itself an
allegation of an injury-in-fact. Spokeo, __ U.S. at __, 194 L. Ed. 2d at 647 (Justice
Thomas concurring) (citations omitted) (“‘Private rights’ have traditionally included
rights of personal security (including security of reputation), property rights, and
contract rights. In a suit for the violation of a private right, courts historically
presumed that the plaintiff suffered a de facto injury merely from having his personal,
legal rights invaded. Thus, when one man placed his foot on another’s property, the
property owner needed to show nothing more to establish a traditional case or
15
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McGEE, C.J., dissenting
controversy. Many traditional remedies for private-rights causes of action – such as
for trespass, infringement of intellectual property, and unjust enrichment – are not
contingent on a plaintiff’s allegation of damages beyond the violation of his private
legal right.”). Breach of contract, trespass, and slander also fall into this category,
and when a plaintiff proves the tort but fails to prove actual damages, nominal
damages are awarded to acknowledge the injury committed. Hildebrand, 219 N.C.
at 408, 14 S.E.2d at 257 (emphasis added) (“The fact that the injury may be trivial,
though material in determining the amount of the owner’s damages, does not affect
his constitutional rights or the principle of law involved. He is entitled to be protected
as to that which is his without regard to its money value.”). This difference between
traditional common law private causes of action, and causes of action created by
statute, has long been recognized and, unlike breach of contract, trespass, or slander,
violations of N.C.G.S. § 163-278.39A(3) and (6) could not have resulted in per se injury
to Plaintiff.
The majority opinion cites Addison v. Britt, 83 N.C. App. 418, 350 S.E.2d 158
(1986), involving the federal Truth in Lending Act. Addison was decided long before
Spokeo and, as cited above, multiple federal courts have since applied Spokeo to find
lack of standing on similar facts. Further, this Court expressly declined to address
the issue for which the majority opinion cites Addison:
Whether liability attaches to creditors for technical or
minor violations of the Act is subject to some dispute
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McGEE, C.J., dissenting
among the various jurisdictions. We need not decide the
question of whether “technical” violations of the actionable
provisions of section 1638 give rise to creditor liability
since, in any event, the particular violation we address
here is not technical in nature.
Id. at 420, 350 S.E.2d at 159 (citation omitted) (emphasis added).
I disagree with the majority opinion’s contention that footnote 7 of Friends of
Queen supports a finding of standing in the present case. This footnote more
accurately recognizes the novelty of the private cause of action enforcement
mechanism included in N.C.G.S. § 163-278.39A(f), and thereby anticipated the
standing issue now before us. Finally, Plaintiff fails to make any argument that “it
is likely, as opposed to merely speculative, that the [alleged] injury will be redressed
by a favorable decision.” Teague, 195 N.C. App. at 22, 671 S.E.2d at 554. I cannot
identify an injury, much less how a monetary award could redress any “injury”
resulting from violations of N.C.G.S. § 163-278.39A(3) or (6). Because I would hold
that Plaintiff has failed in its burden of proving standing, I would dismiss Plaintiff’s
appeal. Stanley, 284 N.C. at 28–29, 199 S.E.2d at 650.
II. Condition Precedent
Plaintiff filed the record in this appeal on 2 June 2017. In Plaintiff’s
Complaint, Plaintiff alleged it had “alerted the State Board of Election[s] [(the
‘Board’)] of [] Defendant’s violation” of N.C.G.S. § 163-278.39A(b)(6),9 and stated that
9 The Notice of Complaint references both N.C.G.S. § 163-278.39A(b)(3) and (6), but only
alleges a violation of N.C.G.S. § 163-278.39A(b)(6).
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McGEE, C.J., dissenting
“[t]he filing of the Notice of Complaint on October 25, 2012 has preserved [] Plaintiff’s
right to bring this action[.]” The Notice of Complaint was signed and notarized on 26
October 2012, but it does not include a file stamp or any other method by which this
Court can determine when or if it was actually filed with the Board. We allowed
amendment of the record on 23 March 2018, but the copy of the Notice of Complaint
included therein was identical to the copy already in the record – lacking a file stamp.
N.C. Gen. Stat. § 163-278.39A(f)(1), which created the cause of action, stated:
Any plaintiff candidate in a statewide race in an action
under this section shall complete and file a Notice of
Complaint Regarding Failure to Disclose on Television or
Radio Campaign Advertising with the State Board of
Elections after the airing of the advertisement but no later
than the first Friday after the Tuesday on which the election
occurred. . . . . The timely filing of this notice preserves the
candidate’s right to bring an action in superior court any
time within 90 days after the election.
Id. (emphasis added); see also Friends of Queen, 223 N.C. App. at 400 n. 4, 735 S.E.2d
at 233 n. 4 (“The plaintiff must . . . file the necessary notices under § 163–278.39A(f)
to preserve the right to bring the action.”). The majority opinion agrees that the filing
requirement in N.C.G.S. § 163-278.39A(f)(1) constituted a statute of repose, or a
jurisdictional condition precedent to the initiation of the present action.
Our Supreme Court has discussed the difference between statutes of
limitations – enforcement of which may be waived – and statutes of repose – which
are unwaivable conditions precedent to the right to initiate an action:
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McGEE, C.J., dissenting
Generally, a statute of limitations has been recognized as
a procedural bar to a plaintiff’s action, which “does not
begin to run until after the cause of action has accrued and
the plaintiff has a right to maintain a suit.” It also has
been long recognized that certain time limitations may
operate, not as procedural bars after an action has accrued,
but as conditions precedent to the action itself.
Bolick v. American Barmag Corp., 306 N.C. 364, 368–69, 293 S.E.2d 415, 419 (1982)
(citations omitted). Therefore, “the commencement of the action within the time [the
statute] fixes is an indispensable condition of the liability and of the action which it
permits. The time element is an inherent element of the right so created, and the
limitation of the remedy is a limitation of the right.” Id. (citation and quotation marks
omitted).
Compliance with the “Notice of Complaint” filing requirement was
jurisdictional and unwaivable, and non-compliance would have served to prevent the
trial court from exercising jurisdiction. In re T.R.P., 360 N.C. 588, 590-91, 636 S.E.2d
787, 790 (2006). Absent subject matter jurisdiction at the trail court level, this Court
is without jurisdiction to consider the matter on appeal. State v. Earley, 24 N.C. App.
387, 389, 210 S.E.2d 541, 543 (1975) (“[T]he jurisdiction of the appellate courts on an
appeal is derivative. If the trial court has no jurisdiction, the appellate courts cannot
acquire jurisdiction by appeal.”).
The majority opinion relies on the allegations in Plaintiff’s Complaint as the
sole evidence that the Notice of Complaint was timely filed with the Board. The
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McGEE, C.J., dissenting
majority opinion’s view is that Plaintiff’s allegation in Plaintiff’s Complaint that
Plaintiff filed the Notice of Complaint on 25 October 2012 was self-proving, and no
additional record evidence is required. I disagree with the majority opinion’s position
that Plaintiff’s mere allegation that it had timely filed the Notice of Complaint can
suffice to meet Plaintiff’s burden of proving jurisdiction. Further, Mr. Forest’s
signature on the Notice of Complaint was notarized on 26 October 2012. Plaintiff’s
allegation that the Notice of Complaint was filed on 25 October 2012, a day before it
was signed by Mr. Forest, cannot be correct and, therefore, should not be relied on to
prove a jurisdictional requirement.
Rule 9 of our Rules of Appellate Procedure requires all record copies of filed
documents to include the file stamp so that this Court can verify the date of filing.
N.C. R. App. P. 9(b)(3). Failure to include a properly executed and filed
jurisdictionally required document in the record generally results in dismissal of an
appeal. See Crowell Constructors, Inc. v. State ex rel. Cobey, 328 N.C. 563, 563–64,
402 S.E.2d 407, 408 (1991); McKinney v. Duncan, __ N.C. App. __, __, 808 S.E.2d 509,
512 (2017) (“The order is devoid of any stamp-file or other marking necessary to
indicate a filing date, and therefore it was not entered. See Huebner v. Triangle
Research Collaborative, 193 N.C. App. 420, 422, 667 S.E.2d 309, 310 (2008) (asserting
that a filing date is to be determined by the date indicated on the file-stamp); see also
Watson, 211 N.C. App. at 373, 712 S.E.2d at 157 (standing for the proposition that a
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McGEE, C.J., dissenting
signed and dated order is insufficient to be considered filed).”);10 State v. High, 230
N.C. App. 330, 335–37, 750 S.E.2d 9, 13–14 (2013); State v. Moore, 148 N.C. App. 568,
571, 559 S.E.2d 565, 567 (2001). I agree with the majority opinion that including a
file-stamped copy of the Notice of Complaint was not the only manner in which
Plaintiff could have proven the Notice of Complaint was timely filed. For instance,
an affidavit from the Board averring timely filing would likely have served as an
adequate substitute. However, I cannot find any law of this State advocating that
Plaintiff’s own allegations can serve to meet Plaintiff’s burden to demonstrate that
the trial court had jurisdiction, and I do not believe that is the law of this State.
Absent evidence of compliance with the N.C.G.S. § 163-278.39A(f)(1) Notice of
Complaint filing requirement, the record fails to establish that the trial court
obtained subject matter jurisdiction. See Hargett v. Holland, 337 N.C. 651, 654–55,
447 S.E.2d 784, 787 (1994) (citations and quotation marks omitted) (“A statute of
repose creates an additional element of the claim itself which must be satisfied in
order for the claim to be maintained.”). Absent proof of jurisdiction at the trial court
10 I also disagree with the majority opinion’s statement that “the lack of a file stamp does not
bear on our appellate jurisdiction” and, therefore, these opinions are “inapposite.” If, as I believe based
on the evidence in this case, the absence of a file-stamped copy of the Notice of Complaint in the record
deprived the trial court of jurisdiction, it necessarily deprives this Court of jurisdiction as well, as our
jurisdiction is derivative. Shepard v. Leonard, 223 N.C. 110, 112, 25 S.E.2d 445, 447 (1943) (“Our
jurisdiction is derivative. If the Superior Court judge who signed the order was without jurisdiction
we have none and it has been the consistent policy of this Court, in the absence of motion, to dismiss
ex mero motu so soon as a defect in jurisdiction is made to appear.”).
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McGEE, C.J., dissenting
level, this Court is without jurisdiction to consider Plaintiff’s appeal. Earley, 24 N.C.
App. at 389, 210 S.E.2d at 543. I would also dismiss Plaintiff’s appeal for this reason.
III. Conclusion
This appeal should be dismissed for lack of subject matter jurisdiction. First,
I believe it is ultimately our Supreme Court that determines what elements are
constitutionally required in order to confer standing and, in the present case, our
constitution requires more than a bare allegation of a statutory violation. Plaintiff
did not allege any injury to itself resulting from the alleged violations of N.C.G.S. §
163-278.39A, and I would hold that Plaintiff lacked standing to bring this action.
Second, by failing to include a file-stamped copy of the Notice of Complaint, or other
sufficient evidence that the Notice of Complaint was timely filed, Plaintiff has failed
in its burden of proving it complied with a jurisdictional condition precedent to the
filing of this action.
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