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Colorado Right to Life Committee, Inc. v. Coffman

Court: Court of Appeals for the Tenth Circuit
Date filed: 2007-08-21
Citations: 498 F.3d 1137
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28 Citing Cases

                                                                      F I L E D
                                                                United States Court of Appeals
                                                                        Tenth Circuit
                                       PU BL ISH
                                                                      August 21, 2007
                     UNITED STATES COURT O F APPEALS               Elisabeth A. Shumaker
                                                                       Clerk of Court
                                  TENTH CIRCUIT



 CO LO RA DO RIGHT TO LIFE
 COM M ITTEE, IN C.,

          Plaintiff-Appellee/Cross-
          Appellant,

 v.

 M IKE COFFM AN, * in his official
 capacity as Colorado Secretary of
 State,

          Defendant-Appellant/Cross-
                                                   Nos. 05-1519 and 05-1538
          Appellee.

 _______________________________


 COLORADO COM M ON CAUSE and
 LEA G U E O F WO M EN V O TERS OF
 C OLO RA D O .

          Amici Curiae in support of
          Defendant- Appellant/Cross-
          Appellee.




      *
        Pursuant to Federal Rule of Appellate Procedure 43(c)(2), Colorado
Secretary of State M ike Coffman is automatically substituted for former Colorado
Secretary of State Gigi Dennis as the Defendant-Appellant/Cross-Appellee in this
case.
                  Appeal from the United States District Court
                          for the District of Colorado
                      (D .C . N o. 03-cv-1454-W DM -PAC)




M aurice G. Knaizer (with M onica M árquez and John W . Suthers, Attorney
General for the State of Colorado, on the briefs), D enver, Colorado for Defendant-
Appellant/Cross-Appellee.

James Bopp, Jr. (with Richard E. Coleson on the briefs), Bopp, Coleson &
Bostrom, Terre Haute, Indiana for Plaintiff-Appellee/Cross-Appellant.

M artha M . Tierney, Kelly/Haglund/Garnsey+K ahn LLC, Denver, Colorado, filed a
brief on behalf of Amici Curiae.


Before H EN RY, A ND ER SO N, and HO LM ES, Circuit Judges.


H E N RY, Circuit Judge.


      Article XXVIII of the Colorado Constitution is a citizen-passed campaign

finance reform amendment designed to limit the influence of certain types of

corporations’ general funds on state elections. Colorado Right to Life Committee

(CRLC), a non-profit ideological corporation, sought declaratory and injunctive

relief against the Colorado Secretary of State, arguing that Article X XVIII

contained provisions that interfered with its traditional communications and

activities and, thereby, violated its First and Fourteenth Amendment rights under

the United States Constitution. The district court granted summary judgment in

part to CRLC and in part to the Secretary. The Secretary now appeals, and CRLC

                                         2
cross-appeals.

      W e have jurisdiction pursuant to 28 U.S.C. § 1291 and affirm. Specifically,

we hold that the challenged sections of Article XXVIII regulating corporate

expenditures and electioneering communications are unconstitutional as applied to

CRLC because CRLC meets Supreme Court-approved exemption requirements for

a voluntary ideological corporation that seeks to engage in political speech. See

FEC v. M ass. Citizens for Life, 479 U.S. 238, 259-60 (1986) (plurality opinion)

(“M CFL”). In addition, we conclude that Article XXVIII’s definition of a

political committee is unconstitutional as applied to CRLC because it fails to

incorporate Buckley v. Valeo’s “major purpose” test. 424 U.S. 1, 79 (1976).

Finally, we decline CRLC’s invitation to reconsider its remaining facial

challenges to various sections of A rticle X XVIII.

                                 I. BACKGROUND

A. Article XXVIII of the Colorado Constitution

      In November 2002, Colorado voters, seeking to limit the influence of money

on state elections, passed Amendment 27. 1 Amendment 27 amended Article


      1

       The people of the state of Colorado hereby find and declare . . . that in recent
years the advent of significant spending on electioneering comm unications, as
defined herein, has frustrated the purpose of existing campaign finance requirements;
that independent research has demonstrated that the vast majority of televised
electioneering communications goes beyond issue discussion to express electoral
advocacy; that political contributions from corporate treasuries are not an indication
of popular support for the corporation’s political ideas and can unfairly influence the
                                                                          (continued...)

                                           3
XXVIII of the Colorado Constitution to prohibit corporations from using their

general funds to make contributions, expenditures, and electioneering

communications. Section 3(4)(a) of Article XXVIII reads:

      It shall be unlawful for a corporation or labor organization to make
      contributions to a candidate committee or a political party, and to make
      expenditures expressly advocating the election or defeat of a candidate;
      except that a corporation or labor organization may establish a political
      committee or small donor comm ittee which may accept contributions or
      dues from employees, officeholders, shareholders, or members. 2

Section 6(2) further reads:

      Notwithstanding any section to the contrary, it shall be unlawful for a
      corporation or labor organization to provide funding for an
      electioneering communication; except that any political committee or
      small donor committee established by such corporation or labor




      1
        (...continued)
outcome of Colorado’s elections; and that the interests of the public are best served
by limiting campaign contributions, encouraging voluntary campaign spending
limits, providing full and timely disclosure of campaign contributions, independent
expenditures, and funding electioneering comm unications and strong enforcement
of campaign finance requirements.

Colo. Const. art. XXVIII, § 1.


      2
         “Expressly advocating” is not defined in Article XXVIII. The Buckley
Court defined express advocacy as “express terms advocat[ing] the election or
defeat of a clearly identified candidate for federal office . . . [and advertisements
that use terminology] such as ‘vote for’ ‘elect,’ ‘support,’ ‘cast your ballot for,’
‘[Candidate’s name] for Congress,’ ‘vote against,’ ‘defeat,’ [and] ‘reject.’” 424
U.S. at 44 & n.52. “Buckley adopted the ‘express advocacy’ requirement to
distinguish discussion of issues and candidates from more pointed exhortations to
vote for particular persons.” M CFL, 479 U.S. at 249.

                                          4
      organization may provide funding for an electioneering communication. 3

      However, following the United States Supreme Court’s teachings in M CFL,

Article XXVIII and Secretary of State Rule 4.13 created an exception to the

prohibition for corporations that meet three requirements. Section 3(4)(b)

provides:

      The prohibition contained in paragraph (a) of this subsection (4) shall
      not apply to a corporation that:

              (I)    Is formed for the purpose of promoting political
                    ideas and cannot engage in business activities; and

              (II) Has no shareholders or other persons with a claim
                   on its assets or income; and

              (III) W as not established by and does not accept
                    contributions from business corporations or labor
                    organizations.

      3
          An electioneering communication is defined as

      any communication broadcasted by television or radio, printed in a
      newspaper or on a billboard, directly mailed or delivered by hand to
      personal residences or otherwise distributed that:

      (I)    Unambiguously refers to any candidate; and

      (II)   Is broadcasted, printed, mailed, delivered, or distributed within
             thirty days before a primary election or sixty days before a
             general election; and

      (III) Is broadcasted to, printed in a newspaper distributed to, mailed
            to, delivered by hand to, or otherwise distributed to an
            audience that includes members of the electorate for such
            public office.

Colo. Const. art. XXVIII, § 2(7)(a).

                                            5
Colo. Const. art. XXVIII, § 3(4)(b). Similarly, Rule 4.13, the Secretary of State

Rules’ exception to § 6(2) reads:

      Article XXVIII § 6(2), concerning the prohibition against funding by
      corporations and labor organizations for electioneering communications,
      shall not apply to any corporation that:

      a. W as formed for the purpose of promoting political ideas and cannot
         engage in business activities;

      b. Has no shareholders with a claim on its assets or other income; and

      c. W as not established by, and does not accept contributions from
         business corporations or labor organizations.

Colo. Sec. of State, Rules Concerning Campaign and Political Finance, Rule 4.13.

W e have labeled the exception established by § 3(4)(b) and Rule 4.13 the “M CFL

exemption.”

      A corporation that meets these criteria may use its general corporate

treasuries to make expenditures, contributions, and electioneering

communications. However, the Secretary maintains that whether or not a

corporation meets the M CFL exemption, it must still register as a political

committee if it makes or accepts contributions or expenditures in excess of $200 to

support or oppose the nomination or election of candidates. Colo. Const. art.

XXVIII, § 2(12)(a) (defining “political committee” as “any person, other than a

natural person, or any group of two or more persons, including natural persons that

have accepted or made contributions or expenditures in excess of $200 to support

or oppose the nomination or election of one or more candidates”); see id. § 7

                                          6
(referring to disclosure requirements relevant to political committees and other

groups, set forth in Colo. Rev. Stat. § 1-45-108 or any successor section).

      Furthermore, if a nonprofit ideological corporation (or “any person”) funds

electioneering communications exceeding $1,000 per year from its general

corporate treasuries, it too must file applicable reports. Section 6(1) of Article

XXVIII details these requirements, while § 6(2) prohibits corporate funding of

electioneering communications:

      Any person who expends one thousand dollars or more per calendar year
      on electioneering communications shall submit reports to the secretary
      of state in accordance w ith the schedule currently set forth in [Colo.
      Rev. Stat. §] 1-45-108(2) . . ., or any successor section. Such reports
      shall include spending on such electioneering comm unications, and the
      nam e, and address, of any person that contributes more than tw o
      hundred and fifty dollars per year to such person described in this
      section for an electioneering communication. In the case where the
      person is a natural person, such reports shall also include the occupation
      and employer of such natural person. The last such report shall be filed
      thirty days after the applicable election.

      Notwithstanding any section to the contrary, it shall be unlawful for a
      corporation or labor organization to provide funding for an
      electioneering communication; except that any political com mittee or
      small donor committee established by such corporation or labor
      organization may provide funding for an electioneering comm unication.

Colo. Const. art. XXVIII, § 6.

      At issue here is whether CRLC is subject to Article XXVIII’s reporting

requirements and whether §§ 3(4) (banning corporations from making

expenditures that expressly advocate the election or defeat of a candidate), 6(2)

(banning corporations from funding electioneering comm unications), and (2)(12)

                                           7
(defining political committee) of Article XXVIII are unconstitutional as applied to

CRLC. W e also discuss CRLC’s contention that these provisions, along with §

2(7), are facially vague and overbroad.

B. Colorado Right to Life Committee

      W e first summarize the undisputed facts regarding CRLC, drawn largely

from the district court’s order. See Colo. Right to Life Comm., Inc. v. Davidson,

395 F. Supp. 2d 1001, 1007-09 (D. Colo. 2005). CRLC is a tax-exempt

organization under 26 U.S.C. § 501(c)(4) and has a policy of not contributing to,

accepting contributions from, or engaging in express advocacy regarding, political

parties or candidates. Likewise, it is not associated with any political candidate,

political party, or campaign committee, and is not aware of ever receiving any

donations at the request of, or solicited by, a political candidate, a political party

or elected official. It has several chapters throughout the State of Colorado.

CRLC’s policy is not to engage in express advocacy or make direct in-kind

contributions.

      CRLC’s corporate organizational documents indicate that its purposes are to

(1) promote reverence and respect for human life without regard to condition,

quality, age, race, religion, creed, or color, whether born or unborn; and (2)

educate the community regarding the dangers of abortion, euthanasia, infanticide,

and compulsory sterilization as well as any legislation that would allow the

debasement of or destroy the community’s moral fiber; and (3) encourage a

                                           8
favorable, spiritual, physical, and cultural environment that would improve the

quality of life consistent with these purposes. CRLC seeks to achieve these

purposes by communicating with the public regarding such issues, providing

information about elected officials, and encouraging Colorado citizens to

communicate with their representatives on these issues.

      CRLC was not established by a business corporation or labor union, and has

no shareholders or otherwise affiliated persons w ho would have a claim on its

assets and earnings. CRLC has two types of members: (1) supporting members,

who include anyone who donates money to the organization, unless that person

asks not to be a member; and (2) voting members, who include anyone who

supports CRLC’s objectives, indicates a desire to join CRLC, and pays the

prescribed dues, unless CRLC’s board has waived those dues.

      Individual donors nearly exclusively fund CRLC through their paying of

dues. In 2001, CRLC had 1,529 donors, including 15 who gave $200 or more. In

2002, CRLC had 2,101 donors, including 19 who gave $200 or more. In 2003,

CRLC had 1,333 donors, including 7 who gave $200 or more.

      CRLC does not have a policy against accepting contributions from business

corporations, and it received $50 in corporate contributions in each of 2001, 2002,

and 2003. Its gross revenues and receipts from membership dues for the same

years were $121,000, $132,000, and $128,000. Additionally, CRLC at one point

participated in a long distance telephone service carrier program in which

                                         9
subscribers could designate it as the recipient of a portion of their bills. 4 In 2003,

CRLC received $358.30 from its participation in this program.

      CRLC also engages in fund-raising activities including the “sale” (via

suggested donations) of “baby feet pins” and bumper stickers at various public

events like the Colorado State Fair. Although there is a suggested donation for the

items, they are often given away. CRLC’s treasurer estimated that CRLC received

approximately $300 per year from these combined activities. Additionally, about a

decade ago, CRLC received income w hen it rented its mailing list to a political

candidate for a state house seat.

      CRLC has not had a political committee or other segregated account since

1986. It has no record of ever receiving donations earmarked for the type of

comm unications at issue in this case.

      CRLC publishes a periodic newsletter, titled The Colorado LifeLight,

which often mentions the names of candidates and their positions on various life

issues. CRLC distributes The Colorado LifeLight year-round, including within 30

days before the primary election and 60 days before the general election. The

newsletter is sent to members, and sometimes to prospective members. In total,

the mailing is sent to approximately 3,000 to 3,500 recipients.

      CRLC also maintains a website that contains a section on politics and law.



      4
       The record indicates that in 2005, CRLC had a similar program w ith a
company called Amerivision.

                                           10
Some articles in that section mention candidates and are available to the public

year round, including immediately preceding elections. Additionally, CRLC

admits that it “might” have placed voter guides on its website in the past.

      In recent election cycles, CRLC has made communications that

unambiguously referred to candidates within 30 days before primary elections and

60 days before general elections to inform voters of the candidates’ views on

abortion. CRLC spent over $1,000 per year on these communications, which have

included voter guides, articles on its website, radio ads, pre-recorded phone

messages, direct-mail, and email. Some examples include:

      • In July 2000, CRLC sent “Rapid Response Cards,” which provided the
      responses of primary candidates in five districts to a CRLC survey
      regarding life-related issues, to individuals from those five districts in
      its mailing list database. In its September newsletter, CRLC noted that
      all five pro-life candidates had won and expressed confidence that “the
      cards had an impact” on the election results. CRLC spent $200 on this
      effort.

      • Before the primaries and general elections in 2000, CRLC circulated
      the results of its 2000 Candidate Questionnaire, which provided the
      responses of some candidates to a variety of abortion and related issues.

      • In August 2002, before the state primary election, CRLC arranged for
      a pre-recorded phone call to be made to identified pro-life supporters in
      M organ County before a primary election in which Jack Darnell and
      G reg B rophy w ere running. The message compared the views of the two
      candidates on abortion, and asked the recipients to urge M r. Darnell to
      “abandon his pro-abortion views” and to “thank” M r. Brophy for
      defending unborn children. CRLC spent $335 on this activity.

      • In August 2002, CRLC, in partnership with the Christian Coalition,
      sent a form letter to registered pro-life voters in House District 55
      comparing the two candidates views on abortion. This letter asked

                                          11
      recipients, when voting in the election, to help stop Gayle B erry’s
      “extreme pro-abortion agenda,” as well as urging recipients to “thank”
      Shari Bjorglund for being “solidly pro-life.” CRLC spent $207 on this
      letter.

      • In August 2002, CRLC published The C olorado LifeLight, with a
      subtitle “Special Report – 2002 Voter Guide.” Although the front page
      was devoted to general information, the remainder of the publication
      reported the responses of 42 candidates for state or federal office to a
      CRLC questionnaire.       In the October/November 2002 Colorado
      LifeLight, CRLC urged recipients to vote no on three ballot measures
      and published a list of Colorado candidates who had been endorsed by
      the National Abortion Rights Action League.

      • In the 2002 general election, CRLC ran radio ads on Denver and
      Longmont stations comparing the partial-birth abortion view s of Fourth
      Congressional District candidates State Senator Stan M atsunaka and
      M arilyn M usgrave. Around that same time, CRLC also ran other radio
      ads encouraging people in Sen. M atsunaka’s district to call him and ask
      him to pass the B orn Alive Infant Protection Act out of his senate
      committee.

C. Procedural Background

      Because of Article XX VIII’s prohibitions and regulations, CRLC

determined it would no longer engage in some of the above activities. CRLC

sought declaratory and injunctive relief. The district court reviewed the following

five claims:

      (1) whether § 3(4)(a)’s ban on corporate contributions and expenditures
      is unconstitutional as applied to CRLC because it is a non-profit
      ideological corporation that does not engage in business activities and
      receives only insubstantial or de minimis contributions from business
      corporations;

      (2) whether § 6(2)’s ban on direct corporate funding for electioneering
      and communications is unconstitutional as applied to CR LC , for the
      same reason that § 3(4)(a)’s ban is unconstitutional as applied to CRLC;

                                        12
      (3) w hether § 2(12)’s definition of “political committee” is
      unconstitutional on its face and as applied to organizations such as
      CRLC that do not have a major purpose of electing candidates;

      (4) whether §§ 6 and 2(7), dealing with “electioneering
      communications” are impermissibly vague and overbroad and cannot be
      constitutionally applied to CRLC’s communications not directly or
      indirectly advocating the election or defeat of any candidate; and

      (5) whether § 3(4)(a)’s ban on corporate expenditures is unconstitutional
      because it is vague and overbroad.

      Both parties sought summary judgment. The district court ruled “as

narrowly as possible,” and addressed CRLC’s as-applied challenges first. 395 F.

Supp. 2d at 1010. The district court granted each motion in part, determining that

Article XXVIII §§ 3(4) (banning corporations from making expenditures that

expressly advocate the election or defeat of a candidate) and 6(2) (banning

corporations from funding an electioneering communication) were

unconstitutional as applied to CRLC because it is exempt from such restrictions

under the principles of M CFL. The district court also found that § 2(12)’s

definition of “political committee” was unconstitutional as applied to CRLC

because it failed to include Buckley’s “major purpose” test.

      The district court rejected, or declined to reach, CRLC’s remaining facial

challenges. Specifically, it rejected CRLC’s vagueness and overbreadth

challenges to § 6(1) (outlining reporting requirements for any person who expends

more than $1,000 per calendar year on electioneering comm unications), noting

that “[a] statute may not be invalidated simply because some persons’ arguably

                                         13
protected conduct may or may not be caught or chilled by the statute.” Id.

(internal quotation marks omitted). Similarly, it rejected CRLC’s vagueness

challenge to § 2(7)’s definition of “electioneering communications” because

“CRLC has not demonstrated that [§ 2(7) is] impermissibly vague in all of its

applications.” Id. at 1017.

      The district court declined to reach CRLC’s facial challenges to §§ 3(4)

(banning corporations from making expenditures that expressly advocate the

election or defeat of a candidate), 6(2) (banning corporations from funding an

electioneering communication), and § 2(12) (defining political committee)

because it had already granted CRLC a narrow er remedy when it found these

sections unconstitutional as applied to CRLC.

                                  II. DISCUSSION

      The Secretary challenges the district court’s grant of summary judgment to

CRLC and enjoinment of his enforcement of certain provisions of A rticle X XVIII

against CRLC. Specifically, the Secretary disputes the district court’s rulings that

(1) § 3(4) (w hich bans corporations from making expenditures that expressly

advocate the election or defeat of a candidate) is unconstitutional as applied to

CRLC because CRLC engaged only in de minimis business activities and received

only de minimis contributions from business corporations; (2) § 6(2) (which bans

corporations from providing funding for electioneering communications) is

unconstitutional as applied to CRLC for the same reason; and (3) § 2(12) (defining

                                          14
political committee) is unconstitutional as applied to CRLC for employing a

trigger of $200 without consideration of whether the organization’s “major

purpose” is the nomination or election of candidates as required by Buckley. W e

must reject the Secretary’s challenges.

      In its cross-appeal, CRLC challenges the facial validity of three sections: §§

6(2) (banning corporations from funding electioneering comm unications), 2(7)

(defining electioneering communications), and 2(12) (defining political

committee). 5 Because we agree with the district court’s determination that CRLC

is an exempt M CFL entity, we need not address CRLC’s challenges to §§ 6(2) and

2(7). A s to its facial challenge to § 2(12), we agree with the district court that w e

need not reach this contention. 6


      5
          CRLC also argues that § 3(4)’s prohibition against a corporations making
expenditures expressly advocating the election of defeat of a candidate, should be
declared unconstitutional both as applied and facially void for vagueness for the
additional reason that this section does not satisfy Buckley’s express advocacy
requirement. Aple’s Br. at 46-48. CRLC acknowledges that it did not raise this
“express advocacy” as-applied challenge in its complaint. Id. at 46-47. W e agree
with the Secretary that at most CRLC argued before the district court that § 3(4)
should be declared facially invalid. The district court declined to address CRLC’s
facial challenge to this section, having found § 3(4) unconstitutional as applied to
CRLC because CRLC was an exempt M CFL entity. Because we agree with the
district court’s approach, and because we generally “decline to consider issues
first raised on appeal,” we will not address this belated argument. Sussman v.
Patterson, 108 F.3d 1206, 1210 (10th Cir. 1997).
      6
        W e must first briefly address the Secretary’s threshold argument that
CRLC lacks standing to challenge § 2(12), which defines a political comm ittee,
because CRLC has not established either a segregated fund or a political
comm ittee.
                                                                      (continued...)

                                           15
A. The Secretary’s Appeal

      W e review the district court’s grant of summary judgment de novo, applying

the same standards used by the district court. Homans v. City of Albuquerque, 366

F.3d 900, 903 (10th Cir. 2004). “W e also review the district court’s findings of



      6
        (...continued)
       Under Article III, standing requires a party to show actual injury, a causal
relation between that injury and the challenged conduct, and the likelihood that a
favorable decision by the court will redress the alleged injury. Lujan v.
Defenders of the Wildlife, 504 U.S. 555, 560-61 (1992). Independent campaign
expenditures constitute “political expression at the core of our electoral process
and of the First Amendment freedoms.” Buckley, 424 U.S. at 39 (internal
quotation marks omitted). The mere fact that CRLC is a corporation does not
remove its speech from the protective ambit of the First Amendment. See, e.g.,
First Nat’l Bank of Boston v. Bellotti, 435 U.S. 765, 777 (1978) (“The inherent
worth of the speech in terms of its capacity for informing the public does not
depend upon the identity of its source, whether corporation, association, union, or
individual.”). There is no doubt that requiring corporations to make independent
expenditures only through segregated funds, such as political or donor
committees, burdens corporate freedom of expression. M CFL, 479 U.S. at 252.
Here, in addition to disclosure requirements, the statute provides various
penalties, see Colo. Const. art. XXVIII, § 10, and at no point in this litigation has
the Secretary suggested that he will not seek enforcement of these penalties.
       Because the Secretary has indicated unequivocally his intent to prosecute
CRLC, CRLC has suffered the constitutionally sufficient injury of self-censorship
through the chilling of protected First Amendment activity, rendering its as-
applied challenge to § 2(12), and, for that matter, its other challenges to Article
XXVIII, justiciable. CRLC also suffers Article III injury when it must either
make significant changes to its operations to obey the regulation, or risk an
investigation and citation. The Secretary rightfully does not challenge the
CRLC’s standing on other grounds, and we hold that CRLC has standing to
challenge portions of Article XXVIII because it undisputedly meets the causation
and redressibility prongs of the standing test.
       Accordingly, because the challenged sections of Article XXVIII infringe on
First Amendment rights, the Secretary bears the burden of proving they are
constitutional as applied to CRLC.


                                         16
constitutional fact in a First Amendment claim and conclusions of law de novo.

Because this decision implicates First Amendment freedoms, we perform an

independent examination of the whole record in order to ensure that the judgment

protects the rights of free expression.” Faustin v. City & County of Denver, 423

F.3d 1192, 1195-96 (10th Cir. 2005) (internal citation omitted).

       Plaintiffs may bring two types of First Amendment challenges to a

government’s policy, facial and as-applied. A facial challenge considers the

restriction’s application to all conceivable parties, while an as-applied challenge

tests the application of that restriction to the facts of a plaintiff’s concrete case.

Like the district court, we consider the disposition of CRLC’s as-applied

challenges first, and then turn to its facial challenges below, in section II.B.

       In an as-applied challenge in the context of campaign finance law s, “limits

on political expenditures deserve closer scrutiny than restrictions on political

contributions.” FEC v. C olo. Republican Fed’l Campaign Comm., 533 U.S. 431,

440 (2001); see FEC v. Wisc. Right to Life, Inc., 127 S. Ct. 2652, 2664 (2007)

(“WRTL”) (“Because [the statute] burdens political speech, it is subject to strict

scrutiny.”); Buckley v. American Const’l Law Found., Inc., 525 U.S. 182, 207

(1999) (“When a State’s election law directly regulates core political speech, w e

have always subjected the challenged restriction to strict scrutiny and required that

the legislation be narrowly tailored to serve a compelling governmental interest.”).

The parties do not dispute that this case involves Article XXVIII’s restrictions on

                                            17
political expenditures, 7 and that political expenditures are subject to strict

scrutiny. Homans, 366 F.3d at 906 (concluding “the standard for expenditure

limits operates identically to strict scrutiny review”). H ence, “to be upheld, . . .

the campaign-expenditure restrictions must be both narrowly tailored and

necessary to serve a compelling state interest.” Id. (internal citations omitted); see

WRTL, 127 S. Ct. at 2664.

      1. As-applied challenge to Article XXVIII §§ 3(4) (banning
      corporations from making expenditures that expressly advocate the
      election or defeat of a candidate) and 6(2) (banning corporations from
      funding an electioneering communication)

      The district court concluded that CRLC is exempt from both § 3(4)’s ban on

corporate expenditures that expressly advocate the election or defeat of a

candidate and § 6(2)’s ban on a corporation’s funding of electioneering

comm unication because CRLC receives only de minimis contributions from

business corporations. The Secretary argues that any business contribution



      7
         In his opening brief, the Secretary insists that CRLC must establish, in its
as-applied challenges, that the state law is unconstitutional as applied to it beyond
a reasonable doubt. The Secretary’s propositions are accurate, except in the
instance of a law, like Article XXVIII, that might “infringe[] on the exercise of
First Amendment rights.” Ass’n of Cmty. Orgs. for Reform Now v. M unicipality of
Golden, 744 F.2d 739, 744 (10th Cir. 1984). The Secretary reluctantly concedes
this point in his reply brief, and acknowledges that in such a case, as here, “its
proponent bears the burden of establishing its constitutionality.” Id. (emphasis
supplied); WRTL, 127 S. Ct. at 2664 (“Under strict scrutiny, the Government must
prove that applying [the statute] to [the organization’s] ads furthers a compelling
interest and is narrowly tailored to achieve that interest”). W e appreciate the
Secretary’s candor, even if a bit belated.


                                           18
forecloses exemption from §§ 3(4) and 6(2).

             a. M CFL exemption

      In M CFL, the Federal Election Commission (“FEC”) charged M CFL, a

nonprofit membership corporation created to oppose abortion rights, with

violating the Federal Election Campaign Act of 1971 (“FECA”), 86 Stat. 11, as

amended, 2 U.S.C. § 441b, by distributing a voter guide in the 1978 congressional

election. 479 U.S. at 244-45. W hen M CFL refused to pay a fine, the FEC sued.

M CFL claimed FECA abridged its First Amendment rights, and the Supreme Court

agreed. The Court first reiterated that independent expenditures could not be

regulated as strictly as contributions. Id. at 259-60. Independent expenditures are

similar to pure issue discussion and therefore remain far removed from the valid

state interest of preventing election corruption. Id.

      The Court also held that FECA could be applied to business corporations

and other entities that presented some danger of “unfair deployment of wealth for

political purposes.” Id. at 259. “D irect corporate spending on political activity

raises the prospect that resources amassed in the economic marketplace may be

used to provide an unfair advantage in the political marketplace.” Id. at 258. The

Court observed that the concerns motivating prohibition of corporate political

spending were absent in regard to M CFL, however, because “[v]oluntary political

associations do not suddenly present the specter of corruption merely by assuming

the corporate form.” Id. at 263. In delineating this exemption, the Court cited

                                          19
three “essential” features of M CFL:

      (1) the entity was formed for the purpose of promoting political ideas,
      and did not engage in business activities;

      (2) it had no shareholders or others with a claim to its assets or
      earnings; and

      (3) it was not formed by a corporation, and had a policy against
      accepting corporate contributions.

Id. at 263-64.

      As noted above, Colorado’s campaign finance amendment includes an

exemption for such corporations. See Colo. Const. art. XXVIII, § 3(4)(b).

Although the prohibition on corporate funding of electioneering comm unications

does not explicitly contain the same exemption, the Secretary promulgated Rule

4.13, which construes § 6(2) to exclude M CFL corporations.

      The parties do not dispute that CRLC satisfies the second prong. Although

the Secretary does not concede that CRLC has satisfied the first prong, 8 he focuses

      8
          Specifically, the Secretary notes that CRLC “does not have a policy
against engaging in business activities and on occasion has sold its telephone
list.” Aplt’s Br. at 28. The Secretary also states that CRLC “has generated a
small income stream by selling its mailing list.” CRLC clarifies that this “sale”
was a one-time rental of its mailing (and not telephone) list for a small
unspecified amount. Id. at 10; Aple’s Br. at 3. The Secretary does not dispute
that this isolated transaction generated minimal income. W e hold that this
activity does not suggest CRLC engages in business activities. See Day v.
Holahan, 34 F.3d 1356, 1364 (8th Cir. 1994) (rejecting state’s argument
concerning a putative M CFL nonprofit corporation’s business activities that
included the regular rental of mailing list and selling of advertisements in its
new sletter that generated minimal income).
       Similarly, CRLC’s minimal sales of “baby feet” pins and bumper stickers
                                                                        (continued...)

                                          20
his arguments on appeal on the third M CFL prong. It is the third prong that poses

the rub: CRLC admits that it does not have a policy against accepting

contributions, and that it has accepted contributions— in the amount of about $50

per year. In response, the Secretary “argues that because the M CFL Court deemed

the characteristics ‘essential,’ the Court created a bright line allowing the

government to regulate the political expenditures of any corporation as long as it

does not share the precise M CFL characteristics.” 395 F. Supp. 2d. at 1012. The

district court refused to adopt the Secretary’s unbending argument that “Colorado

may prohibit direct political expenditures by an advocacy corporation such as

CRLC if it accepts de m inimis corporate contributions.” Id.

      The Secretary acknowledges that § 3(4)(b) and Rule 4.13 comport with

M CFL. But, he argues that by allow ing an exception for de minimis corporations,

the district court diverts the analysis to a review of a corporation’s day-to-day

actions. As a practical matter, “[t]he courts and the public do not have the

resources to conduct such reviews.” Aplt’s Br. at 27. Because “[e]ven minimal

expenditures can have a significant impact,” the Secretary argues that the district


      8
        (...continued)
do not preclude it from qualifying as an M CFL-exempt corporation. Such
activities cannot be classified as “business activities.” See M CFL, 479 U.S. at
263 (“If political fundraising events are expressly denominated as requests for
contributions that will be used for political purposes, . . . these events cannot be
considered business activities.”). Indeed, M CFL itself engaged in various
fundraising activities such as garage sales, bake sales, dances, raffles, and
picnics. See id. at 242.


                                          21
court’s approach is impractical and invites corruption. Id.

      W e disagree with the Secretary’s analysis for substantially the same reasons

as the district court. The district court relied in part on the reasoning of every

other circuit to have addressed this issue, noting that if corporate contributions

made up a minimal part of an organization’s revenue, the M CFL exemption

applies. See FEC v. Nat’l Rifle Ass’n, 254 F.3d 173, 192 (D.C. Cir. 2001)

(holding that sponsorship of non-political activities, provision of non-political

goods and services such as magazines and accident insurance to members, lack of

policy against corporate contributions, and actual receipt of up to $1,000 in

corporate contributions did not turn an incorporated advocacy group “into a

potential conduit for corporate funding of political activity”); N.C. Right to Life,

Inc. v. Bartlett, 168 F.3d 705, 714 (4th Cir. 1999) (lack of policy against corporate

donations and receipt of up to a “modest percentage [8% ] of revenue” from

corporations did not prevent corporation from claiming M CFL exemption); FEC v.

Survival Educ. Fund, Inc., 65 F.3d 285, 293 (2d Cir. 1995) (stating that “a

nonprofit political advocacy corporation, which in fact receives no significant

funding from unions or business corporations, does not surrender its First

Amendment freedoms for the want of such a policy” and holding that lack of

policy against corporate contributions and actual receipt of up to 1% of funds from

corporations did not place group outside scope of M CFL exemption); Day v.

Holahan, 34 F.3d 1356, 1363-65 (8th Cir. 1994) (holding that the lack of policy

                                           22
against corporate donations and engaging in “incidental” business activities did

not put group outside M CFL exemption).

      W e agree with these courts that M CFL does not establish an immobile set of

parameters. See, e.g., Day, 34 F.3d at 1367 (“The state goes too far in concluding

that the factual findings of M CFL translate into absolutes in legal application.”).

Instead, they are really factors to determine whether a corporation is more like the

“type of traditional corporatio[n] organized for economic gain,” or the voluntary

political association of M CFL. M CFL, 479 U.S. at 259 (internal quotation marks

omitted); see id. at 263 (“Some corporations have features more akin to voluntary

political associations than business firms, and therefore should not have to bear

burdens on independent spending solely because of their incorporated status.”).

      As previously noted, CRLC receives approximately $50 of corporate

funding per year. This figure, “[b]oth as a percentage of its gross income

(significantly less than 1% ) and an absolute number, . . . could not “‘have turned

[CRLC] into a potential conduit for corporate funding of political activity.’” 395

F. Supp. 2d. at 1014 (quoting Nat’l Rifle Ass’n, 254 F.3d at 192).

                    b. Post-M CFL Supreme Court decisions

      In response to the district court’s analysis, the Secretary suggests that the

four circuits that have applied the M CFL exemption have misconstrued the C ourt’s

decision. Recognizing that every circuit that has addressed the issue has allowed

for incidental or de minimis corporate contributions, the Secretary argues that

                                          23
Supreme Court precedent dictates we should apply the M CFL exemption only

sparingly, citing Austin v. M ichigan Chamber of Commerce, 494 U.S. 652 (1990),

FEC v. Beaumont, 539 U.S. 146 (2003), and M cConnell v. FEC, 540 U.S. 93

(2003). After review ing these cases, we conclude that the Secretary’s arguments

are unpersuasive.

                    (i) Austin v. M ichigan Chamber of Commerce

      In Austin v. M ichigan Chamber of Commerce, 494 U.S. 652 (1990), the

Supreme Court revisited the M CFL exemption when it addressed the M ichigan

Chamber of Commerce’s (the “Chamber’s”) as-applied challenge to M ichigan’s

Campaign Finance Act. Id. at 655. Initially, the Supreme Court rejected a facial

overbreadth challenge to the law on the grounds that it regulated “closely held

corporations that do not possess vast reservoirs of capital.” Id. at 661. The Court

determined that although some closely held corporations may not have

accumulated significant amounts of wealth, “they receive from the State the

special benefits conferred by the corporate structure and present the potential for

distorting the political process,” which justified the law’s general applicability.

Id.

      Additionally, the Court held that although the Chamber was a non-profit

ideological corporation, it did not qualify as an M CFL corporation under the three

factors. Id. at 662. First, the Court held that although the Chamber engaged in

political activities, its primary purposes involved business and economic issues in

                                          24
contrast to M CFL’s primary political purpose. Id. Second, the Court observed

that:

        Although the C hamber also lacks shareholders, m any of its members
        may be similarly reluctant to withdraw as members even if they disagree
        with the Chamber’s political expression, because they wish to benefit
        from the Chamber’s nonpolitical programs and to establish contacts w ith
        other members of the business community.

Id. at 663.

        Accordingly, the C ourt found that the C hamber’s “members are more

similar to shareholders of a business corporation than to members of M CFL.” Id.

Finally, the C ourt remarked that “more than three-quarters of the Chamber’s

members are business corporations, whose political contributions and expenditures

can constitutionally be regulated by the State.” Id. at 664. Consequently,

recognizing the Chamber as an M CFL corporation would circumvent the purpose

of M ichigan’s campaign finance law.

        The Secretary suggests that Austin supports his theory that the Court intends

a bright constitutional line to exist between M CFL and non-M CFL entities. In

fact, the Court’s analysis suggests that the Chamber’s challenge to M ichigan’s law

failed because it was closer to a traditional corporation than a voluntary political

association. Given CRLC’s close resemblance to a voluntary political association,

much like the one at issue in M CFL, we agree with the district court that CRLC’s

acceptance of de minimis contributions does not transform it into a “potential

conduit for corporate funding of political activity.” 395 F. Supp. 2d. at 1014

                                          25
(quoting Nat’l Rifle Ass’n, 254 F.3d at 192).

                   (ii) FEC v. Beaumont

     In Beaumont, the plaintiff was an officer of North Carolina Right to Life,

Inc. (“NCRL”), a not-for-profit corporation organized under N orth Carolina law.

NCRL’s funding came almost entirely from donations from individual members,

but it also accepted a small amount in corporate donations. NCRL used its general

treasury funds to make both independent expenditures and contributions to

candidates for state office, as allowed by North Carolina law. NCRL challenged

the federal prohibition on contributions from its treasury to candidates for federal

office.

      NCRL, like CRLC, based its challenge on M CFL, contending that as an

M CFL entity, NCRL had a constitutionally protected right to make contributions

to candidates. The Fourth Circuit agreed, holding that contributions by such a

group, like independent expenditures, fell within the M CFL exemption to

prohibitions on corporate activity.

      The Supreme Court reversed, noting that the case was correctly

characterized as a contributions, rather than an expenditures, case, and thus

subject to reduced scrutiny. The Court admonished that advocacy corporations

may also raise corruption concerns, as they too “benefit from significant state-

created advantages.” Beaumont, 539 U.S. at 159-60 (internal quotation marks

omitted). The Court asserted that “[n]on-profit advocacy corporations are,

                                         26
moreover, no less susceptible than traditional business companies to misuse as

conduits for circumventing the contribution limits imposed on individuals.” Id.

(emphasis supplied).

      The district court here rejected the Secretary’s reliance on Beaumont

because the case focuses on contributions, not expenditures, and is thus not

analogous. Cf. Beaumont, 539 U.S. at 164 (Kennedy, J., concurring) (M CFL

“contains language supporting the Court’s holding here that corporate

contributions can be regulated more closely than corporate expenditures.”)

(emphasis supplied). Because we focus on Article XXVIII’s restrictions on

expenditures, we agree with this distinction, and reject the Secretary’s argument

on appeal.

                   (iii) M cConnell v. FEC

      Third and finally, the Secretary and Amici Curiae Colorado Common Cause

and the League of W omen Voters of Colorado, turn to M cConnell for support of a

bright-line application of M CFL. They focus specifically on the M cConnell

Court’s statement that “[o]ur decision in M CFL related to a carefully defined

category of entities.” 540 U.S. at 210. Standing alone, we acknowledge this

language limits the breadth of M CFL factors; however, the M cConnell Court also

distinguished the case before it from M CFL:

      M CFL was not established by a business corporation or a labor union,
      and it is its policy not to accept contributions from such entities. This
      prevents such corporations from serving as conduits for the type of

                                         27
      direct spending that creates a threat to the political marketplace.”

Id. at 211 (quotation marks omitted) (emphasis supplied).

      The district court applied the same analysis. It noted that CRLC closely

resembled M CFL’s plaintiff: “both are nonprofit, non-stock corporations sharing

very similar purposes, advocacy activities, and funding mechanisms, including

voluntary donations from members and informal fund-raising sales such as bake

sales, in the case of M CFL, or baby-feet pin sales in the case of CR LC.” 395 F.

Supp. 2d at 1014. The notable difference between the two is that CRLC receives

about $50 of corporate funding per year. 9 This amount represents less than one

percent of CRLC’s gross income and does not invite the creation of a political

conduit for corporate funding of political activity. 10 W e agree with the district


      9
         W e note that in WRTL, the Court chose not to “pass on [an] argument”
that W RTL was a nonprofit advocacy group eligible for the M CFL exemption
“because W RTL’s funds for its ads were not derived solely from individual
contributions.” 127 S. Ct. at 2673 n.10. The WRTL dissent notes that W RTL was
unable to take advantage of the M CFL exemption because it “chose[] to serve as a
funnel for hundreds of thousands of dollars from other corporations.” Id. at 2703
(Souter, J., dissenting). W ithout more, we cannot hold that WRTL impacts our
holding that CRLC’s receipt of de minimis business contributions forecloses
application of the M CFL exemption to it.
      10
         W e further note that the amounts of money CRLC received from its
participation in Life-Line and similar programs do not qualify as corporate
contributions relevant to the M CFL exemption. This program allowed subscribers
to donate a percentage of their phone bill payment to a nonprofit organization of
their choosing. In 2003, C RLC received a total of $358.30 from this program. A s
the Fourth Circuit (and the district court in this case) observed, “while these
contributions may technically come from the phone company, they in fact result
from the decisions of individual phone company customers.” Bartlett, 168 F.3d at
                                                                         (continued...)

                                          28
court that the Secretary “has not demonstrated that [§] 6(2)’s infringement upon

CRLC’s protected speech is supported by a compelling justification. . . . For the

same reasons, [§] 3(4)(a), to the extent it proscribes a corporation from making

‘expenditures expressly advocating the election or defeat of a candidate’ except

through a committee, is unconstitutional as applied to CRLC.” Id. at 1014-15.

      2. As-applied challenge to Article XXVIII § 2(12)’s definition of “political
      committee”

      The Secretary next challenges the district court’s grant of summary

judgment to and enjoinment of his enforcement of § 2(12) against CRLC. Section

2(12)(a) defines political committee as “any person, other than a natural person, or

any group of two or more persons, including natural persons that have accepted or

made contributions or expenditures in excess of $200 to support or oppose the

nomination or election of one or more candidates.” Colo. Const. art. XXVIII, §

2(12)(a). The district court struck down § 2(12) as applied to CRLC. The district

court stated that “Buckley establishes that regulation should be tied to groups

controlled by candidates or which have a ‘major purpose’ of electing candidates.”

395 F. Supp. 2d at 1020. Because “[i]t [was] not clear whether the facts presented



      10
        (...continued)
714. Accordingly, participation in such a program does not implicate the same
concerns regarding the potential for distorting the political process as direct
corporate contributions do. W e also agree with the district court’s observation
that “even if they were corporate contributions, they are likewise de minimis,”
because they would raise CRLC’s total corporate contributions to “approximately
$400, or approximately .3% of its total revenues.” 395 F. Supp. 2d at 1014, n.10.

                                         29
would expose CRLC to ‘political com mittee regulation,’” the district court

assumed that they did and ruled on an as-applied basis. Id. at 1020 n.22.

      Here, the Secretary argues he can regulate an entity even if it does not have

Buckley’s “major purpose” of nominating, electing, or defeating a candidate.

Should this court disagree with the Secretary’s proposed broad regulatory powers,

he urges us to construe § 2(12) as incorporating the “major purpose” test, thus still

requiring disclosure.

             a. Federal regulation of political committees: Buckley’s “major
             purpose” test

      Regulation of “political committees” by campaign finance law began with

the passage of FECA. According to FECA, a “political committee” is any group

that receives “contributions” or makes “expenditures” exceeding $1,000 per year.

2 U.S.C. § 431(4). A “contribution” or “expenditure” is any gift or payment made

“for the purpose of influencing any election for Federal office.” Id. § 431(8)(A)(i),

(9)(A)(i).

      The Supreme Court later added in Buckley, that a group is not a “political

committee” unless its “major purpose” is to influence federal elections. 424 U.S.

at 79. The Court explained that:

      The general requirement that “political committees” and candidates
      disclose their expenditures could raise similar vagueness problems, for
      “political committee” is defined only in terms of amount of annual
      “contributions” and “expenditures,” and could be interpreted to reach
      groups engaged purely in issue discussion. The lower courts have
      construed the words “political committee” more narrowly. To fulfill the

                                          30
      purposes of [FEC A] they need only encom pass organizations that are
      under the control of a candidate or the major purpose of which is the
      nomination or election of a candidate. Expenditures of candidates and
      of “political committees” so construed can be assumed to fall within the
      core area sought to be addressed by Congress. They are, by definition,
      campaign related.

Id. (footnotes omitted) (emphasis supplied). This construction of the term political

comm ittee as applied to non-candidate organizations has come to be known as the

“major purpose” test. See FEC v. Akins, 524 U.S. 11, 29 (1998) (considering

whether certain of organization’s expenditures were membership comm unications

in connection with application of the “‘major purpose’” test).

       In M CFL, the C ourt suggested two methods to determine an organization’s

“major purpose”: (1) examination of the organization’s central organizational

purpose; or (2) comparison of the organization’s independent spending with overall

spending to determine w hether the preponderance of expenditures are for express

advocacy or contributions to candidates. 479 U.S. at 252 n.6 (noting that M CFL’s

“central organizational purpose [wa]s issue advocacy, although it occasionally

engage[d] in activities on behalf of political candidates”); see id. at 262 (noting

that “should M CFL’s independent spending become so extensive that the

organization’s major purpose may be regarded as campaign activity, the

corporation would be classified as a political committee”). Thus, under FECA, any

group that (1) spends more than $1,000 in a year, and (2) has as its “major purpose”

the influencing of a federal election, should be considered a political committee.



                                           31
As a political committee, the group must adhere to certain registration,

organizational, recordkeeping, reporting, and disclosure requirements. See M CFL,

479 U.S. at 254 (“[M ]ore extensive requirements and more stringent restrictions . .

. may create a disincentive for such organizations to engage in political speech.”).

             b. Colorado’s regulation of political committees

      Under Colorado’s definition of political committees, any group that spends

more than $200 a year to support or oppose the nomination or election of one or

more candidates is subject to the State’s various administrative, organizational, and

reporting requirements. In concluding that § 2(12) was unconstitutional as applied

to CRLC, the district court noted that the $200 trigger, standing alone, is

incompatible with a “major purpose” test: “[T]he amount of money an

organization must accept or spend–$200–is not substantial and would, as a matter

of common sense, operate to encompass a variety of entities based on an

expenditure that is insubstantial in relation to their overall budgets.” 395 F. Supp.

2d at 1021. The court added that, under § 2(12)(a), “an entity that spends $200,000

on various non-political activities and donates $200 (1/10 of 1% of its budget) to a

candidate is deemed a political committee.” Id.

      The Secretary first argues the district court erred when it determined § 2(12)

was unconstitutional as-applied to CRLC and that its “reasoning [was] based upon

the flaw ed assumption that the major purpose component is constitutionally

compelled by Buckley . . . .” Aplt’s Br. at 31. The Secretary also suggests that

                                          32
M cConnell somehow reevaluated Buckley. The Secretary avers without much

explanation, that, “[a]s with the distinction between express advocacy and issue

advocacy, the incorporation of a major purpose test into the definition of political

comm ittee ‘was an endpoint of [statutory] interpretation, not a first principle of

constitutional law.’” Aplt’s Br. at 31-32 (quoting M cConnell, 540 U.S. at 190).

      Because the distinction between issue advocacy and express advocacy is not

constitutionally compelled, he argues, there is also no required inclusion of the

“major purpose” test. “In other words, it is the ‘major purpose’ of the expenditure

and not the ‘major purpose’ of the organization that is constitutionally significant.”

Aplt’s Reply Br. at 23 (emphasis supplied). Thus, the Secretary seems to suggest

that the $200 trigger satisfied the major purpose test.

      W e cannot agree with the Secretary’s broad propositions. 11 First, there is

little question that Buckley’s “major purpose test” is left unaltered in the wake of

M cConnell. See Political Committee Status, Definition of Contribution, and

       11
          In fact, the Supreme Court recently made clear in WRTL that the
distinction between issue advocacy and express advocacy can be paramount in the
context of electioneering communications: “a court should find that [advocacy] is
the functional equivalent of express advocacy only if the [advocacy] is
susceptible of no reasonable interpretation other than as an appeal to vote for or
against a specific candidate.” 127 S. Ct. at 2667. Again referring to
electioneering communications, the Court also “decline[d] to adopt a test for
as-applied challenges turning on the speaker’s intent to affect an election.” Id. at
2665. The Court reiterated the difficulties of regulating issue advocacy in
electioneering communications: if the regulated advocacy was “not express
advocacy or its equivalent, the Government’s task is . . . formidable. It must then
demonstrate that [the regulation] is narrowly tailored to serve a compelling
interest.” Id. at 2664.

                                           33
Allocation for Separate Segregated Funds and Nonconnected Committees, 69 Fed.

Reg. 68,056, 68,065 (Nov. 23, 2004) (“[N]o change through regulation of the

definition of ‘political committee’ is mandated by [the Bipartisan Campaign

Reform Act, (“BCRA”)] or the Supreme Court’s decision in M cConnell. The

‘major purpose’ test is a judicial construct that limits the reach of the statutory

triggers in FECA for political committee status. The Commission has been

applying this construct for many years without additional regulatory definitions,

and it will continue to do so in the future.”) (emphasis added); N.C. Right to Life,

Inc. v. Leake, 482 F. Supp. 2d 686, 692 (E.D.N.C. 2007) (“In M cConnell,

[reviewing BCRA] the major purpose test was not directly examined. Thus, the

Court in M cConnell did not overturn or criticize the major purpose test, and its

authority remains in force.”); see also Trevor Potter, M cConnell v. FEC

Jurisprudence and its Future Impact on Campaign Finance, 60 U. M IAMI L. R EV .

185, 198 (2006) (“[T]he [M cConnell Court] implicitly affirmed the continuing

applicability of the ‘major purpose’ test when it referred to the ‘major purpose’

language in the Buckley opinion.”) (citing M cConnell, 540 U.S. at 170 n.64

(quoting Buckley, 424 U.S. at 79)). Hence, we hold that Colorado’s “interest in

disclosure . . . can be met in a manner less restrictive than imposing the full

panoply of regulations that accompany status as a political committee. . . .” M CFL,

479 U.S. at 262.

      Second, for substantially the same reasons as the district court, we agree that

                                           34
the $200 trigger, standing alone, cannot serve as a proxy for the “major purpose”

test as applied to CRLC: “[T]he amount of money an organization must accept or

spend–$200–is not substantial and would, as a matter of common sense, operate to

encompass a variety of entities based on an expenditure that is insubstantial in

relation to their overall budgets.” 395 F. Supp. 2d at 1021. The court added that,

under § 2(12)(a), “an entity that spends $200,000 on various non-political activities

and donates $200 (1/10 of 1% of its budget) to a candidate is deemed a political

comm ittee.” Id. Section 2(12), as written, is thus unconstitutional as applied to

CRLC.

             c. Narrowing construction

      The Secretary maintains that if we hold that the “major purpose” test

survives M cConnell, then § 2(12)’s definition of political committee as applied to

CRLC is readily susceptible to a narrowing construction that will remedy any

constitutional infirmity presented by the omission of the “major purpose” test. See

Aplt’s Br. at 39 (citing C itizens for Responsible Gov’t State Political Action Com m .

v. Davidson, 236 F.3d 1174, 1194 (10th Cir. 2000)). He avers that because

Colorado’s definition of political comm ittee is substantially similar to the federal

definition, and Colorado “has used federal campaign law as a template for its

campaign laws,” § 2(12) should withstand constitutional scrutiny. Id. at 39.

      Generally, we consider the application of a narrowing construction in the

context of a facial challenge. See Virginia v. Am. Booksellers Ass’n, Inc., 484 U.S.

                                           35
383, 397 (1988) (“It has long been a tenet of First A mendment law that in

determining a facial challenge to a statute, if it be ‘readily susceptible’ to a

narrowing construction that would make it constitutional, it will be upheld.”);

Citizens for Responsible G ov’t State Political Action Comm, 236 F.3d at 1194. A s

we later discuss, we decline to reach CRLC’s facial challenge to § 2(12).

However, regardless of whether we characterize the Secretary’s argument as

addressing a facial or as-applied challenge, we agree with the district court that the

statute does not lend itself to a narrowing construction.

      To be readily susceptible to a narrowing construction, such a construction

must be “reasonable and readily apparent.” Stenberg v. Carhart, 530 U.S. 914, 944

(2000) (internal quotation marks omitted). “[W ]here an otherwise acceptable

construction of a statute w ould raise serious constitutional problems, the Court will

construe the statute to avoid such problems unless such construction is plainly

contrary to the intent of Congress.” Edward J. DeBartolo Corp. v. Fla. Gulf Coast

Bldg. & Constr. Trades Council, 485 U.S. 568, 575 (1988). Thus, “we will not

rewrite a state law to conform it to constitutional requirements.” Am. Booksellers

Ass’n, 484 U.S. at 397.

      Here, importantly, we note that Article XXVIII’s definition of “issue

comm ittee” includes the very “major purpose” test at issue, suggesting that the

legislature was well aware of Buckley’s requirements w hen it drafted Article

XXVIII. See id. § 2(10)(a) (“‘Issue committee’ means any person, other than a

                                            36
natural person, or any group of two or more persons, including natural persons . . .

[t]hat has a major purpose of supporting or opposing any ballot issue or ballot

question . . . .”). The inclusion of the “major purpose” test in § 2(10)(a) indicates

that the decision not to include this requirement in the definition of political

committee w as deliberate and consistent with the state citizenry’s intent. Because

we cannot re-w rite state law s to conform with constitutional requirements where

doing so would be inconsistent with legislative, or here, the state citizenry’s intent,

we hold that the district court properly concluded that § 2(12) as applied to CRLC

could not saved by incorporating a narrowing construction. See Bartlett, 168 F.3d

712-13 (4th Cir. 1999) (striking down North Carolina campaign finance statute as

facially vague and overbroad, noting that the court was unable to excise the word

“incidental” from a statute because “[t]o accept [North Carolina’s] proffered

interpretation would read the references to influencing elections (a classic form of

issue advocacy) right out of the statute”).

B. CRLC’s Cross-Appeal

      In its cross-appeal, CRLC challenges three sections of Article XXVIII: §§

6(2), 2(7), and 2(12). First, it argues in the alternative, that if we reverse the

district court’s decision that CRLC is an M CFL entity, then we must address its

facial overbreadth and vagueness challenges to §§ 6(2) and 2(7). 12 However,

       12
        W e reiterate that a party should not take a cross-appeal when it succeeds
below. Leprino Foods. Co. v. Factory M ut. Ins. Co., 453 F.3d 1281, 1290 (10th
                                                                      (continued...)

                                              37
because we hold that CRLC meets the M CFL exemption requirements, we need not

address this argument.

      Next, it asks us to consider whether § 2(12)’s definition of political

committee, which the district court declared unconstitutional as applied to CRLC,

is also facially unconstitutional. “Facial challenges seek to vindicate not only

individual plaintiffs’ rights but also those of all others who wish to engage in the

speech being prohibited.” Faustin, 423 F.3d at 1196.

      To succeed, CRLC must establish that the law, in every application, “creates

an impermissible risk of suppression of ideas, such as an ordinance that delegates

overly broad discretion to the decisionmaker, and in cases where the ordinance

sw eeps too broadly, penalizing a substantial amount of speech that is

constitutionally protected.” Forsyth County v. Nationalist M ovement, 505 U.S.

123, 129-30 (1992) (internal citations omitted); Faustin, 423 F.3d at 1199 (“The

overbreadth claimant bears the burden of demonstrating from the text of the law

and from actual fact, that substantial overbreadth exists.”). This task presents a

“heavy burden” for the plaintiff. M cConnell, 540 U.S. at 207.

      Here, the district court determined it need not address CRLC’s facial

challenge to § 2(12). W e agree with the general proposition that a court should

“never . . . formulate a rule of constitutional law broader than is required by the

      12
       (...continued)
Cir. 2006) (“Only a party aggrieved by the judgment may appeal, and [the
defendants were] 100% successful.”) (internal quotation marks omitted).

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precise facts to which it is to be applied,” and that the nature of judicial review

constrains a federal court to consider only the case that is actually before it.

M cConnell, 540 U.S. at 192 (citing United States v. Raines, 362 U.S. 17, 21 (1960)

and James B. Beam Distilling Co. v. Georgia, 501 U.S. 529, 547 (1991)

(Blackmun, J., concurring)); United States v. Nat’l Treasury Em ployees Union, 513

U.S. 454, 477-78 (1995) (“[A]lthough the occasional case requires us to entertain a

facial challenge in order to vindicate a party’s right not to be bound by an

unconstitutional statute, we neither want nor need to provide relief to nonparties

when a narrower remedy will fully protect the litigants.”) (internal citations

omitted); Broadrick v. O klahom a, 413 U.S. 601, 613 (1973) (holding that a ruling

of facial invalidity “is, manifestly, strong medicine” and noting that “[i]t has been

employed by the C ourt sparingly and only as a last resort”).

       CRLC’s facial validity argument is succinct: “because the application of

political committee status to groups lacking the requisite major purpose is self-

evidently ‘substantial,’ . . . the provision ought to be declared unconstitutional on

its face as well.” Aple’s Br. at 46. W e agree with CRLC that the application of §

2(12)(a) to it creates an impermissible risk of the suppression of ideas because it

omits the “major purpose” test and encompasses groups whose “incidental

purpose” may be to engage in express advocacy. Bartlett, 168 F.3d at 712-13.

However, without more, we cannot say that in every application § 2(12) will be

unconstitutional and we decline to formulate a rule of constitutional law broader

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than is required. M cConnell, 540 U.S. at 192. Therefore, we decline to reach

CRLC’s facial invalidity challenge.

                                  III. CONCLUSION

      This case demonstrates the exacting scrutiny a campaign reform act will

undergo when it regulates an organization’s expenditures. Here, because CRLC is

an M CFL-exempt entity, §§ 3(4)(a) and (6)(2) of Article X XVIII are

unconstitutional as applied to it. Section 2(12)(a) is also unconstitutional as

applied to CRLC because it does not contain Buckley’s “major purpose” test.

      Accordingly, we AFFIRM the district court’s thorough and well-reasoned

order to the extent that it granted summary judgment in part and afforded injunctive

relief to CRLC, and we DISM ISS the remainder of CRLC’s cross-appeal.




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