Missourians for Fiscal Accountability v. Missouri Ethics Commission

Filing 25

ORDER AND OPINION DISMISSING CASE WITHOUT PREJUDICE. Signed on 4/27/15 by District Judge Ortrie D. Smith. (Matthes, Renea)

IN THE UNITED STATES DISTRICT COURT FOR THE
WESTERN DISTRICT OF MISSOURI
CENTRAL DIVISION
MISSOURIANS FOR FISCAL
ACCOUNTABILITY,
Plaintiff,
vs.
JAMES KLAHR, in his official capacity
as Executive Director of the
Missouri Ethics Commission,
Defendant.

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Case No. 14-4287-CV-C-ODS

ORDER AND OPINION DISMISSING CASE WITHOUT PREJUDICE

On the strength of the Eighth Circuit’s decision in National Right to Life Political
Action Committee v. Connor, 323 F.3d 684 (8th Cir. 2003), the Court concludes
Plaintiff’s claims are not ripe for adjudication. The case is dismissed without prejudice.

I. BACKGROUND

Plaintiff is a “political organization” within the meaning of section 527 of the
Internal Revenue Code. It was formed on October 22, 2014, with the intent of collecting
contributions and expending money to advocate for Proposition 10, a proposed
amendment to the Missouri Constitution that was to be voted upon during the November
4, 2014 general election. To that end, on October 29, 2014, Plaintiff endeavored to
register as a “campaign committee” as required by Missouri statutes. However, Plaintiff
was concerned that provisions of Missouri law precluded Plaintiff from collecting or
expending funds in connection with its support of Proposition 10, and on October 30 it
filed this suit seeking a temporary restraining order (“TRO”), preliminary and permanent
injunctions, and a declaration, all establishing that such a prohibition violates the First
Amendment and enjoining Defendant – the Director of the Missouri Ethics Commission

(“MEC”), who was sued only in his official capacity – from enforcing what Plaintiff has
described as a thirty-day blackout period. On October 31, Plaintiff filed a separate
Motion for Temporary Restraining Order; a hearing was held later that day, and on
November 2 the Court issued a TRO that enjoined Defendant “from enforcing the thirtyday blackout period imposed by Section 130.011 of the Missouri Revised Statutes,”
which permitted Plaintiff to “take actions that violate the blackout period” and precluded
Defendant from investigating or sanctioning Plaintiff for taking those actions. The TRO
expired by its terms after the election.
Two days after the election, the Court directed the parties to show cause why the
case should not be dismissed for lack of jurisdiction because the dispute was rendered
moot by the election’s occurrence. The parties agreed that Missouri law required
Plaintiff to register at least thirty days in advance of any future elections it desired to
participate in, so – based on Connor’s discussion of mootness – the Court concluded
the dispute was not moot. In a footnote, the Court observed that “Connor held the
dispute over a similar provision involving different types of campaign committees was
not moot after the election in question occurred, but that the dispute was not ripe. The
circumstances . . . appear to differentiate this case from Connor.” However, the parties
had not addressed – and the Court had not purported to apply – Connor’s holding
regarding ripeness.
On January 8, 2015, the Court directed the parties to file Briefs addressing
whether a final judgment should be entered based on the rationale expressed in the
TRO. Among the arguments presented by Defendant is a contention that the case must
be dismissed because the dispute is not ripe for adjudication.

II. DISCUSSION

Section 130.011(8) of the Revised Missouri Statutes defines a “campaign
committee” in terms that include limitations on what a campaign committee is and can
do. In pertinent part, the statute provides that a campaign committee must “be formed
no later than thirty days prior to the election for which the committee receives
contributions or makes expenditures . . . .” Arguably, then, a campaign committee
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cannot collect or expend money for any election that occurs within thirty days of its
formation.1 And, while Plaintiff “exists” in the sense that it is a “political organization”
under Section 527 of the Internal Revenue Code, the parties agree that the designation
as a “campaign committee” under state law is election-specific, and a political
organization such as Plaintiff must “re-register” should it wish to collect or expend funds
in connection with a future election. E.g., Doc. # 19 at (“Defendant Klahr agrees [that i]f
MFA chooses to accept contributions or make expenditures in support of or in
opposition to another ballot initiative during a future election, §130.011 requires that
MFA re-register as a campaign committee at least 30 days before the election.”).

A. Mootness

The Court suggested that this case had become moot (stale) because the
election of November 2014 passed, reasoning that Plaintiff could no longer advocate for
passage of Proposition 10, and the mootness exception for disputes capable of
repetition yet evading review did not apply because the November 2014 election could
not occur again. In response, Plaintiff argued that it might accept contributions and
make contributions in future elections, which would (as discussed above) necessitate
re-registering as a campaign committee. While it may appear that any conflict with the
thirty-day requirement could be avoided if Plaintiff simply registered at least thirty days
before it engaged in this activity – and thus diminish the likelihood of the dispute
recurring – Plaintiff cited Connor for the contrary proposition.
Connor involved a challenge to Section 130.011(10) of the Revised Missouri
Statutes – a provision that applies to a different type of committee but that similarly
requires registration within a specified period before the election for which the
committee raises or expends contributions. In that case, the plaintiffs desired to involve
itself in the 2000 election for Governor of Missouri, but not until approximately three
weeks before the election. As explained by the Court of Appeals:

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Defendant characterizes the statute differently, but there is no reason to delve
into this issue as the case is being dismissed on ripeness grounds.
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Prior to October 16, 2000, when then-Missouri Governor and United
States Senate candidate Mel Carnahan was killed in an airplane crash,
neither NRLC or NRLPAC intended to make expenditures with respect to
any Missouri race in the November 7, 2000, election. Rather, NRLPAC
had been vigorously advocating Carnahan's defeat in his race against
then-incumbent Senator John Ashcroft. As a result of Carnahan's death,
NRLPAC decided to shift its focus and efforts toward the Missouri
gubernatorial race between Jim Talent and Bob Holden. NRLPAC
immediately printed new political communications expressly advocating
Jim Talent's election in that race. It planned to distribute these
communications beginning October 17, 2000, twenty-one days before the
election.
Connor, 323 F.3d at 687.
One of the claims in Connor is virtually identical to the claim asserted in this
case: it alleged “that Missouri Revised Statute section 130.011(10) is an
unconstitutional prior restraint on political speech because it requires a ‘continuing
committee’ to be formed and registered at least thirty days before an election in order to
make expenditures.” Id. at 690. After the November 2000 election occurred, the district
court dismissed this claim for the alternative reasons that it was (1) moot and (2) no
longer ripe. The Eighth Circuit disagreed with the mootness analysis: it agreed that the
dispute was moot, but held that the exception for disputes capable of repetition yet
evading review should apply. With respect to whether the dispute was capable of
repetition, the court stated that it “believe[d] that any number of events . . . might cause
[a committee] to become involved in a state race within thirty days of an election. For
instance, polls might reveal a closer race than expected and attract [a committee’s]
resources. New information or effective advertising could drastically alter public opinion
in the weeks before an election. Trends in other races could elevate the importance of
races with less clear outcomes.” Id. at 692. The Court of Appeals also concluded the
dispute could evade review. Id. As mentioned earlier, the Court relied on the near
identity between this case and Connor to hold that Plaintiff’s claim is not moot.

B. Ripeness
Curiously – despite (1) citing Connor originally in response to the Court’s query
about mootness, (2) observing the stark similarity between the cases, see Doc. # 13 at
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3, and (3) Defendant’s reliance on Connor’s discussion of the ripeness issue – Plaintiff
failed to cite Connor (much less discuss or distinguish it) in the face of Defendant’s
presentation of the ripeness issue. See Doc. # 23. The similarities between the cases
makes Connor impossible to ignore, and Plaintiff’s failure to address or distinguish it
leaves the Court little basis for reaching a different result.
Connor explained that the “rationale of the ripeness doctrine is to prevent the
courts, through avoidance of premature adjudication, from entangling themselves in
abstract disagreements over administrative policies, and also to protect the agencies
form judicial interference until an administrative decision has been formalized and its
effects felt in a concrete way by the challenging parties.” 323 F.3d at 692 (quotations
omitted). When evaluating whether a dispute is ripe for judicial consideration, courts
must consider “(1) the hardship to the plaintiff caused by delayed review; (2) the extent
to which judicial intervention would interfere with administrative action; and (3) whether
the court would benefit from further factual development.” Id. at 692-93.
In determining whether the challenge to section 130.011(10) was ripe for
consideration, the Eighth Circuit started by observing the plaintiffs had “not alleged with
any degree of specificity the constitutional threat they would face for failing to register
before the thirty-day cutoff” because the statute “does not, on its face limit . . . advocacy
within thirty days of an election; it merely states a registration deadline.” Id. at 693. In
this regard the Court of Appeals noted an affidavit from the MEC’s then-President
confirming that the MEC permitted committees to register after the thirtieth day before
an election, had not taken action to prevent such a committee from receiving or
expending funds, and that the MEC “entered agreements with treasurers of those
committees for the payment of fees pursuant to the [MEC’s] authority under §
105.961.4(6), Mo.Rev.Stat.” Id. The court also noted that the plaintiffs had not
“presented evidence on the issue of fees, nor ha[d] they sought clarification under
section 105.955.16, the Missouri statute authorizing the MEC to issue advisory
opinions.” Id. The court agreed with the district court that how the MEC would handle a
fee for a committee seeking to register within thirty days of an election was important,
and “these issues would benefit substantially from further development.” Id. The court
concluded by agreeing that delayed review would not work any hardship on the plaintiffs
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as their desire to participate in future elections provided “an incentive to seek an MEC
opinion and gather evidence regarding the enforcement of section 130.011(10). They
may, in fact, discover that no real threat of enforcement exists at all,” and a claim is not
ripe for adjudication if it depends on contingent facts that may not occur. Id.
The exact same factors that persuaded the Eighth Circuit to hold the challenge in
in Connor was not ripe are present in this case.


The court described section 130.011(10) as a registration deadline and not a
restriction on advocacy. The statute Plaintiff challenges – section 130.011(8) – is
a virtually identical provision that applies to a different kind of committee. Plaintiff
consistently refrains from characterizing it as a registration deadline, but Plaintiff
has not acknowledged Connor and thus has not presented a basis upon which
the Court can (or is empowered to) reach a different conclusion.



As in Connor, Defendant’s Verified Answer confirms that the MEC still “accepts
Statements of Committee Organization filed by campaign committees after the
thirtieth day before an election,” that it “recognizes the existence and registration”
of such committees,” and that it “does not take any action to prevent a campaign
committee from making or receiving contributions or expenditures . . . just
because that committee failed to file its statement of organization by the thirtieth
day prior to that election.” Verified Answer, ¶¶ 39-40. When a late registration is
submitted, the MEC – as described in Connor – still “negotiate[s] with the
treasurer of such committee for the payment of a fee in an amount not greater
than one thousand dollars under § 105.961.4(6).” Id. ¶ 43.



Plaintiff, like the plaintiffs in Connor, has not sought an advisory opinion from the
MEC.



Plaintiff has not presented evidence of enforcement actions by Defendant (or the
MEC) dealing with the imposition of a fee for late registration. So like the
plaintiffs in Connor, Plaintiff has not demonstrated a threat of enforcement.
Plaintiff also has not demonstrated what the fee is for a committee that seeks to
register late.

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Given these similarities between Connor and the case at bar, the Court would
understandably look for an argument explaining why the outcome in Connor does not
dictate the outcome in the case at bar. As noted, however, Plaintiff has not addressed
Connor’s ripeness analysis. Instead:


Plaintiff contends the issue was previously addressed and ruled upon. To the
contrary: This Court clearly addressed the issue of mootness and made a
preliminary observation about ripeness. Moreover, Connor establishes that
mootness and ripeness are different (albeit related), and the outcome on one
does not dictate the outcome on the other. Finally, the Court has a continuing
obligation to insure that it has jurisdiction over a case.



Plaintiff argues its claim is capable of repetition yet evading review. However,
this was also true in Connor. There, the fact that the claim could be repeated yet
evade review triggered the exception to mootness, but did not prevent the claim
from being dismissed as unripe. Plaintiff does not explain why the argument
should matter here when it did not matter in Connor, and in truth the mootness
exception does not serve to overcome the lack of ripeness. It may be plausible
that, at some unspecified point in the future, Plaintiff will find itself in a situation in
which it wants to involve itself in an election within thirty days of the vote – but
this does not mean that adjudication of such an abstract eventuality is not
premature.



Plaintiff argues that it should not have to seek an advisory opinion because the
law is clear. However, it is just as clear as the law was in Connor. In this regard,
Plaintiff concedes the MEC accepts late registrations and assesses a late filing
fee – which is exactly the situation present in Connor. Nonetheless, Connor
mentioned the plaintiffs’ ability to seek an advisory opinion as a factor in the
ripeness analysis.
In the context of a different argument, Plaintiff has presented settlements

between MEC and other committees. To the extent Plaintiff intended (despite failing to
specifically so indicate) that these settlements constitute the missing “evidence
regarding the enforcement” of the registration requirements, the effort falls short. The
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first (contained in Exhibit B to Plaintiff’s March 11, 2015 filing) involved a settlement
over a committee’s violation of numerous provisions of Missouri law, including failure to:
register more than thirty days before the election, register within twenty days of
formation, timely file campaign finance disclosure reports, and include certain
disclosures on campaign advertising. The MEC and the committee reached an
agreement on payment of a $3,100 fee, but if the committee paid $400 within forty-five
days of the agreement the balance of the fee would be stayed. The second settlement
involved a committee that failed to register more than thirty days before the election and
also failed to register within twenty days of its formation; the committee and the MEC
agreed to payment of a $1,000 fee, but if the committee paid $100 within forty-five days
the balance was to be stayed. These proceedings do not resolve the contingency of
future facts for at least three reasons: (1) presumably, this sort of information was
equally available to the court in Connor, yet the claim was still not deemed ripe, (2) the
situations are different in that the two committees violated other (and in the case of the
first, several other) provisions of Missouri law, so the settlements reveal little about this
specific provision, and (3) it appears that both of these committees’ violations were
discovered after the fact; there is still no indication as to how the MEC responds when a
committee approaches after the deadline but before it raises or spends funds and
attempts to register.
Ultimately, this case looks exactly like Connor. And Plaintiff has not disputed (or
even addressed) this point, nor has it explained why the outcome in this case should not
mirror the outcome in Connor. For these reasons, the Court relies on Connor to hold
that this case is not ripe for adjudication.

III. CONCLUSION

The case is dismissed without prejudice. The Court expresses no opinion on
Defendant’s remaining arguments.
IT IS SO ORDERED.
/s/ Ortrie D. Smith
ORTRIE D. SMITH, SENIOR JUDGE
UNITED STATES DISTRICT COURT

DATE: April 27, 2015
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