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).
38
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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