Free and Fair Election Fund et al v. Missouri Ethics Commission et al
AMENDED ORDER AND OPINION (1) GRANTING IN PART AND DENYING IN PART DEFENDANTS' MOTIONS TO DISMISS, AND (2) PARTIALLY GRANTING PLAINTIFFS' MOTIONS FOR PERMANENT INJUNCTION. Signed on 5/17/17 by District Judge Ortrie D. Smith. (Matthes Mitra, Renea)
IN THE UNITED STATES DISTRICT COURT FOR THE
WESTERN DISTRICT OF MISSOURI
FREE AND FAIR ELECTION FUND, et al.,
MISSOURI ETHICS COMMISSION, et al.,
MISSOURI ELECTRIC COOPERATIVES,
d/b/a Association of Missouri Electric
Cooperatives, et al.,
STATE OF MISSOURI, et al.,
Case No. 16-04332-CV-C-ODS
AMENDED ORDER AND OPINION (1) GRANTING IN PART AND DENYING IN PART
DEFENDANTS’ MOTIONS TO DISMISS, AND (2) PARTIALLY GRANTING
PLAINTIFFS’ MOTIONS FOR PERMANENT INJUNCTION1
On November 8, 2016, seventy percent of Missouri voters approved Initiative
Petition 2016-007, thereby amending, effective December 8, 2016, Article VIII of the
Missouri Constitution to add Section 23.2 Plaintiffs seek permanent injunctive relief
The Court issued its original decision on May 5, 2017. Doc. #88. On May 16, 2017,
Defendants filed a motion to clarify permanent injunction. Doc. #90. The Court grants
Defendants’ motion, and now issues this Amended Order and Opinion. The Court only
amends point 4 of page 39 of the permanent injunction. This amendment reflects the
Court’s original intent. The stay set forth in the Court’s May 5, 2017 Order is not
The official ballot title provided:
Shall the Missouri Constitution be amended to:
preventing enforcement of several provisions of Section 23. Defendants seek dismissal
of Plaintiffs’ claims. As detailed below, the Court grants in part and denies in part
Defendants’ motions to dismiss, partially grants Plaintiffs’ motions, and enjoins
Defendants’ enforcement of Section 23 in a manner inconsistent with this Order.
Section 23 imposes campaign finance regulations and restrictions on individuals
and entities in Missouri. Section 23’s regulations and restrictions can be divided into
three types: (1) monetary limits on contributions, (2) restrictions on the sources of some
contributions, and (3) measures to prevent evasion of Section 23’s regulations and
Under Section 23’s monetary limit on contributions, no individual may contribute
more than $2,600 “[t]o elect an individual to the office of governor, lieutenant governor,
secretary of state, state treasurer, state auditor, attorney general, office of state senator,
office of state representative or any other state or judicial office....” Mo. Const., art. VIII,
§ 23.3(1)(a). A political party may not accept contributions, in aggregate, greater than
$25,000 from an individual or political committee during any one election in which a
political party participates. § 23.3(2)(a)-(b).
Section 23 imposes restrictions on contribution sources by dividing political
candidates and committees into several overlapping categories, which are used to place
• establish limits on campaign contributions by individuals or entities to
political parties, political committees, or committees to elect candidates for
state or judicial office;
• prohibit individuals and entities from intentionally concealing the source
of such contributions;
• require corporations or labor organizations to meet certain requirements
in order to make such contributions; and
• provide a complaint process and penalties for any violations of this
It is estimated this proposal will increase state government costs by at
least $118,000 annually and have an unknown change in costs for local
government entities. Any potential impact to revenues for state and local
governments is unknown. Doc. #31, at 4 n.3.
restrictions on the sources from which these groups may receive contributions.3 First,
corporations and unions may not contribute to a campaign committee, candidate
committee, exploratory committee, political party committee, or a political party, but may
establish a “continuing committee” to which its members, officers, directors, employees,
and security holders may contribute. § 23.3(3)(a). Second, corporations may only
contribute to a political action committee (“PAC”) if the corporation is formed under
chapters 347 through 360 of the Missouri Revised Statutes.4 § 23.3(12). Third, a
foreign corporation, one not organized under Missouri law, may not contribute to a PAC
unless it is authorized to do business in Missouri pursuant to chapter 347. §
23.3(16)(c). Fourth, a PAC may not accept contributions from other PACs, candidate
committees, political party committees, campaign committees, exploratory committees,
or debt service committees. § 23.3(12). Fifth, candidate committees are prohibited
from contributing to another candidate committee. § 23.3(4). Sixth, and finally, all
candidates and committees are prohibited from receiving contributions from any out-ofstate committee unless the out-of-state committee organizes within the State of Missouri
or files Missouri-required disclosure reports. § 23.3(11).5
Section 23 also includes measures to prevent evasion of the new regulations and
restrictions. Section 23 prohibits: (1) any person from contributing under a fictitious or
borrowed name (§ 23.3(7)); (2) any person from contributing anonymously in amounts
greater than $25 (§ 23.3(8)); (3) any committee from receiving more than $500 in
anonymous contributions (§ 23.3(9)), with a narrow exception for certain welldocumented group events (§ 23.3(10)); and (4) any committee or political party from
accepting a cash contribution over $100 per election (§ 23.3(6)). Section 23 broadly
forbids transferring “anything of value to any committee with the intent to conceal...the
identity of the actual source.” § 23.3(14). Further, Section 23 prohibits anyone from
being reimbursed for contributions (§ 23.3(15)), and requires contributions from children
The law uses the term “committee” to include both an individual person and a
combination of persons, based on the purpose of the individual or group. § 23.7(4).
All references to “chapter” are to chapters contained in the Missouri Revised Statutes
unless stated otherwise.
All non-Missouri committees remain free to make independent expenditures to
influence Missouri elections in their own names. See generally § 23 (providing no
prohibition on such conduct).
under fourteen years old be deemed contributions from the child’s parents or guardians
(and thus, subject to their parents’ or guardians’ contribution limits). § 23.3(17).
Defendant Missouri Ethics Commission (“MEC”) is charged with enforcing
Section 23. Anyone who violates Section 23 may face civil and criminal penalties. §§
23.3(14), 23.4(1)–(6); 23.5; 23.6; see also Mo. Rev. Stat. §§ 105.955–.977 (2017). Any
person may file a complaint, and local county prosecutors may also bring charges for a
violation of Section 23. Doc. #75. Finally, and relevant here, Section 23 includes a
severability provision that provides, “[i]f any provision of this section is found by a court
of competent jurisdiction to be unconstitutional or unconstitutionally enacted, the
remaining provisions of this section shall be and remain valid.” § 23.8.
Following Section 23’s enactment, the MEC received questions from interested
parties seeking to clarify what conduct Section 23 did or did not prohibit. On January 6,
2017, the MEC approved a resolution in which it acknowledged “interest of the
regulated community in receiving interpretation” of many questions regarding Section
23, but the MEC declined “to issue the opinions on this date due to pending litigation but
will consider the issuance on these questions on a future date.” Doc. #35-1, at 6. On
February 10, 2017, the MEC issued several advisory opinions interpreting provisions of
Section 23. The Court will discuss applicable advisory opinions in detail below.
On December 7, 2016, Plaintiffs Association of Missouri Electric Cooperatives
(“AMEC”), Association of Missouri Electric Cooperatives PAC (“AMEC-PAC”), David
Klindt (“Klindt”), and Legends Bank (collectively “AMEC Plaintiffs”) brought suit in the
United States District Court for the Eastern District of Missouri against the State of
Missouri, the MEC, and the MEC’s Commissioners in their official capacities. Case No.
17-4006, Doc. #1.6 AMEC is an association of nonprofit, member-owned rural electric
cooperative corporations. AMEC’s members are organized under chapter 394, related
to rural electric cooperatives, rather than chapters 347 through 360. AMEC alleges
Section 23 prevents it and their member organizations from contributing to AMEC-PAC
and various other entities. Klindt is AMEC’s Vice President.7
AMEC Plaintiffs later filed an Amended Complaint. Case No. 17-4006, Doc. #28.
Klindt recently retired from his position as AMEC Vice President, but is still associated
with AMEC under a consulting agreement.
AMEC-PAC is a PAC formed and maintained by AMEC. AMEC-PAC alleges
Section 23 unconstitutionally prohibits it from accepting contributions from its member
organizations, both foreign and domestic. Legends Bank is a Missouri chartered bank
organized under chapter 362. Legends Bank made contributions to PACs in the past,
but alleges Section 23 now prohibits future contributions.
The MEC is a state agency acting under Missouri’s executive branch. The MEC
investigates and enforces Missouri’s campaign finance laws, and is composed of six
members appointed by the Governor with the Missouri Senate’s advice and consent.
Each member is a Missouri citizen and resident, and serves a four-year term. Currently,
the commission members are Chair Nancy Hagan, and Vice Chairs Bill Deeken, Eric L.
Dirks, Don Summers, Kim Benjamin, and George Ratermann.
AMEC Plaintiffs allege Section 23’s prohibitions on contributions violate their First
Amendment rights to free speech and assembly, their Fourteenth Amendment equal
protection rights, and their rights under Article 1, Section 8 of the Missouri Constitution.
AMEC Plaintiffs ask the Court to enjoin Defendants, their agents, or anyone acting on
their behalf or in concert with them from enforcing Sections 23.3(12) and (16)(c).
On December 23, 2017, Plaintiffs Free and Fair Election Fund (“FFEF”),
Missourians for Worker Freedom (“Worker Freedom”), American Democracy Alliance
(“ADA”), John Elliott (“Elliott”), Herzog Services, Inc. (“HSI”), and Farmers State Bank
(“Farmers”) (collectively “FFEF Plaintiffs”) brought suit in this Court against the MEC, its
commissioners in their official capacities, and James Klahr in his official capacity as
Executive Director of the MEC.8 Case No. 16-4332, Doc. #1. FFEF is a Missouri PAC
and continuing committee. FFEF’s purpose is to receive monetary contributions and
make independent expenditures to influence voters. Worker Freedom is a Missouri
campaign committee. ADA is a Missouri not-for-profit corporation organized under
chapter 355, with its principal place of business in Jackson County, Missouri. Elliott is a
Missouri citizen and taxpayer. HSI is a for-profit corporation organized under Kansas
law, but its principal place of business is in Missouri and it has authority to transact
Freedom PAC was initially a Plaintiff, but a stipulation of dismissal as to Freedom PAC
(Doc. #42) was filed, after which the Court dismissed Freedom PAC from the lawsuit
business in Missouri. Farmers is a Missouri chartered bank organized under chapter
362, and is a Missouri citizen and taxpayer, with its principal place of business in
Missouri. Collectively, FFEF Plaintiffs challenge Section 23’s $2,600 cap on
contributions to candidates, and challenge the same source prohibitions challenged by
Although AMEC Plaintiffs brought suit in the United States District Court for the
Eastern District of Missouri, Judge Catherine Perry ordered the case transferred to the
Central Division of this Court. Case No. 17-4006, Doc. #45. The Court then
consolidated the AMEC matter with FFEF’s challenge, and set a hearing on Plaintiffs’
motions for preliminary injunction.10 Doc. #25. Defendants filed two motions to dismiss,
and the Court expedited the briefing so that all motions were fully briefed prior to the
hearing. Docs. #28, 30, 32. Defendants’ motions to dismiss were subsequently
converted to motions for judgment on the pleadings.11 Doc. #41. Finally, pursuant to
Federal Rule of Civil Procedure 65(a)(2), the Court converted the hearing on Plaintiffs’
motions for preliminary injunction to a hearing on Plaintiffs’ requests for permanent
injunction. Doc. #63.
On March 3, 2017, the Court held a hearing. All parties were expertly
represented by counsel. During the hearing, the Court found several areas of
agreement among the parties, and encouraged the parties to continue their dialogue
regarding potential resolution of this matter. Although the parties were unable to
resolve all claims, the parties reached agreement on two aspects. First, Defendants
and the AMEC Plaintiffs stipulated to the dismissal of AMEC’s Count V, which alleged
Section 23’s enactment violated the Missouri Constitution. Doc. #81. Accordingly, the
FFEF Plaintiffs alleged a violation of the United States Constitution’s Privileges and
Immunities clause, but have abandoned that claim. Doc. #60, at 35. Accordingly, the
Court dismisses Count II of FFEF Plaintiffs’ Complaint.
On the same day the Court ordered these matters consolidated, the Court denied
proposed Intervenor Todd Jones’s Motion to Intervene. Case No. 17-4006, Doc. #54.
Although the Court converted Defendants’ motions to dismiss to motions for judgment
on the pleadings, the Court refers to the motions as motions to dismiss for ease of
reference. The Court reviews a motion for judgment on the pleadings under the same
standard that governs motions to dismiss for failure to state a claim. Ashley County,
Ark. v. Pfizer, Inc., 552 F.3d 659, 665 (8th Cir. 2009); Westcott v. City of Omaha, 901
F.2d 1486, 1488 (8th Cir. 1990).
Court dismissed Count V of AMEC’s Amended Complaint. Doc. #87. Second, the
parties agreed to a proposed consent judgment regarding the constitutionality and
enforcement of Section 23’s ban on corporate and union contributions to a ballot
measure committee. Doc. #79. As detailed infra, section II.B.(3)(a), the Court
incorporates this proposed consent judgment, and will enjoin enforcement of Section
23’s ban on corporate and union contributions to a ballot measure committee.
The issues before the Court are numerous. First, the Court considers
Defendants’ motions to dismiss. Second, the Court considers Plaintiffs’ motions for
permanent injunctive relief.
A. Motions to Dismiss
Defendants filed two motions to dismiss. First, Defendants move to dismiss the
State of Missouri and all state-law claims presented in AMEC Plaintiffs’ Amended
Complaint. Doc. #28. Second, Defendants move to dismiss the operative complaints in
both matters in their entirety. Doc. #30. The Court grants Defendants’ first motion
(Doc. #28), and denies Defendants’ second motion (Doc. #30).
(1) First Motion to Dismiss
Defendants seek to dismiss the State of Missouri and all state-law claims brought
by AMEC Plaintiffs. “The Eleventh Amendment immunizes an unconsenting State from
damage actions brought in federal court, except when Congress has abrogated that
immunity for a particular federal cause of action.” Becker v. Univ. of Neb. at Omaha,
191 F.3d 904, 908 (8th Cir. 1999); see generally Kimel v. Fla. Bd. of Regents, 528 U.S.
62, 73 (2000) (“[F]or over a century now, we have made clear that the Constitution does
not provide for federal jurisdiction over suits against nonconsenting States.”). Three
exceptions to Eleventh Amendment immunity exist: (1) where the state waives
immunity by consenting to suit in federal court, (2) where Congress abrogates the
state’s immunity through valid exercise of its powers, and (3) under Ex parte Young,
209 U.S. 123 (1908), where the plaintiff files suit against state officials seeking
prospective equitable relief for ongoing violations of federal law. Sundquist v. Neb., 122
F. Supp. 3d 876, 876 (D. Neb. 2015).
AMEC Plaintiffs argue the State of Missouri is not immune from suit for
declaratory judgment actions under state law, and maintain the state waived immunity
by appearing in this matter. The Court rejects these arguments. AMEC Plaintiffs point
to case law in which actions seeking a declaration that Missouri laws are
unconstitutional proceeded against the State of Missouri. See, e.g., Rizzo v. State, 189
S.W.3d 576 (Mo. banc 2006); Legends Bank v. State, 361 S.W.3d 383 (Mo. banc 2012).
However, AMEC Plaintiffs’ Count V, the only count presenting a challenge solely under
Missouri law, was dismissed after the parties stipulated to Count V’s dismissal. Doc.
#87. As it relates to AMEC Plaintiffs’ Amended Complaint, the Court is left with counts
alleging violations of both federal and state law. The Court will address the merits of
these claims in a manner that does not involve state law. Furthermore, the entry of an
appearance and filing of an answer, in which the state asserted sovereign immunity,
does not amount to a waiver of the state’s immunity.
As AMEC Plaintiffs note, “[g]ranting the Motion to Dismiss the State of Missouri
would have no practical effect on this litigation.” Doc. #49, at 6 n.1. While state officials
may be sued under Ex Parte Young, this doctrine does not extend to states. See
Monroe v. Ark. State Univ., 495 F.3d 591, 594 (8th Cir. 2007). Finding the State of
Missouri is immune from suit under the Eleventh Amendment, and no exception to the
general rule applies, the Court grants Defendants’ motion to dismiss the State of
Defendants also moved to dismiss all state-law claims presented in AMEC
Plaintiffs’ Amended Complaint. Defendants argue the Court lacks subject matter
jurisdiction because Plaintiffs invoked jurisdiction only under 28 U.S.C. § 1331, which
provides jurisdiction over claims invoking federal law. This Court has supplemental
jurisdiction “over all other claims that are so related to claims in the action within such
original jurisdiction they form part of the same case or controversy under Article III of the
United States Constitution.” 28 U.S.C. § 1367(a). The Court addresses the merits of
Plaintiffs claims under the United States Constitution, and does not consider Plaintiffs’
claims under the Missouri Constitution. Accordingly, the Court dismisses the state-law
claims without prejudice. The Court grants Defendants’ first motion to dismiss (Doc.
(2) Second Motion to Dismiss
In their second motion to dismiss, Defendants seek dismissal of all claims by
both sets of plaintiffs. Defendants give four reasons why the Court should grant their
second motion to dismiss. First, Defendants argue Plaintiffs mistake the actual
requirements of Section 23, and accordingly, Plaintiffs’ lack standing, and their claims
are not ripe.12 Second, Defendants admit Section 23’s ban on corporate and union
contributions to ballot measure committees violates the United States Constitution, and
state the MEC will not enforce that provision. Accepting Defendants’ position on these
two points would lead the Court to conclude Plaintiffs do not have standing and their
claims are not ripe. Third, Defendants contend the remaining challenged portions of
Section 23 are lawful restraints on political activity. Accepting Defendants’ position on
this point would lead the Court to conclude Plaintiffs fail to state a claim because
Section 23’s provisions are lawful. Fourth, Defendants point to their first motion to
dismiss, noting claims against the State of Missouri and AMEC Plaintiffs’ state-law
claims should be dismissed. The Court has already addressed this final argument. See
(a) Standing and Ripeness Legal Standards
The “irreducible constitutional minimum” of standing has three elements.
Spokeo, Inc. v. Robins, 136 S. Ct. 1540, 1547 (2016) (quoting Lujan v. Defenders of
Wildlife, 504 U.S. 555, 560 (1992)). A plaintiff must have “(1) suffered an injury in fact,
First, Defendants argue Plaintiffs mistake Section 23.3(1)(a)’s $2,600 contribution limit
as applying in aggregate to all contributions per election to all candidates combined.
Second, Defendants argue Plaintiffs mistakenly allege Section 23.3(1)(a)’s $2,600
contribution limit is unconstitutionally vague because it is not clear how the limit applies
when Plaintiffs contribute to multicandidate PACs. Third, Defendants argue Plaintiffs
mistakenly construe the $2,600 contribution limit as applying to contributions to PACs
that only make independent expenditures. Fourth, Defendants argue Plaintiffs
mistakenly contend Section 23.3(16)(c) prevents contributions to PACs from
corporations not organized under chapter 347 of the Missouri Revised Statutes. The
Court will address these alleged mistakes when considering the merits of Plaintiffs’
motions to permanent injunction.
(2) that is fairly traceable to the challenged conduct of the defendant, and (3) that is
likely to be redressed by a favorable judicial decision.” Id. (citing Lujan, 504 U.S. at
560-61; Friends of the Earth, Inc. v. Laidlaw Envtl. Serv. (TOC), Inc., 528 U.S. 167, 18081 (2000)). An “injury-in-fact” is “realistic danger of sustaining a direct injury as a result
of the statute’s operation or enforcement.” Iowa Right to Life Comm., Inc. v. Tooker,
717 F.3d 576, 584 (8th Cir. 2013) (quoting St. Paul Area Chamber of Commerce v.
Gaetner, 439 F.3d 481, 485 (8th Cir. 2006)).
Two types of injuries can confer standing in the First Amendment context when a
plaintiff seeks prospective relief. Missourians for Fiscal Accountability v. Klahr, 830
F.3d 789, 794 (8th Cir. 2016) (citations omitted). First, a plaintiff can establish standing
by alleging “an intention to engage in a course of conduct arguably affected with a
constitutional interest, but proscribed by a statute, and there exists a credible threat of
prosecution thereunder.” Id. (quoting Babbitt v. United Farm Workers Nat’l Union, 442
U.S. 289, 298 (1979)). A threat of future or present prosecution must be “credible”
rather than “wholly speculative.” Iowa Right to Life Comm., 717 F.3d at 584 (citations
omitted). Second, a plaintiff can establish standing by alleging it self-censored.
Missourians for Fiscal Accountability, 830 F.3d at 794 (citing 281 Care Comm. v.
Arneson, 638 F.3d 621, 627 (8th Cir. 2011)). “A party need not expose itself to arrest or
prosecution under a criminal statute to challenge it in federal court.” Iowa Right to Life
Comm., 717 F.3d at 584. A party suffering from a credible threat of future prosecution
suffers from an ongoing injury resulting from the statute’s chilling effect on his desire to
exercise his First Amendment rights. Missourians for Fiscal Accountability, 830 F.3d at
794 (citations omitted).
Faced with a claim of self-censorship, the Court must consider whether a party’s
decision to chill its speech in light of the challenged statute was objectively reasonable.
Id. (citing 281 Care Comm., 638 F.3d at 627) (quotations omitted)). Although
complaints against plaintiffs may not reach the criminal stage or prosecution may not be
threatened, non-criminal consequences contemplated by a challenged statute may
contribute to the objective reasonableness of an alleged chill. Id.
In addition to finding Plaintiffs have standing to bring their claims, the Court must
determine whether Plaintiffs’ claims are ripe for review. Rather than prematurely
adjudicating a dispute, the ripeness doctrine prevents Courts “from entangling
themselves in abstract disagreements over administrative policies, and also protects the
agencies from judicial interference until an administrative decision has been formalized
and its effects felt in a concrete way by the challenging parties.” Id. at 796 (quoting Nat’l
Right to Life Political Action Comm. v. Connor, 323 F.3d 684 (8th Cir. 2003)). “To
decide ripeness, courts 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
796-97 (citation omitted). The touchstone of a ripeness inquiry is whether the harm
asserted has matured enough to warrant judicial intervention. Id. at 797 (citation and
(b) Advisory Opinions
The MEC issued advisory opinions after receiving inquiries from various entities.
Defendants argue these advisory opinions accurately represent how Section 23 will be
enforced, and are binding legal authorities establishing Plaintiffs will not suffer criminal
or civil penalties if they engage in the challenged conduct. On that basis, Defendants
argue Plaintiffs lack standing because the advisory opinions establish Plaintiffs do not
face a credible threat of enforcement if they engage in the challenged conduct.
Plaintiffs argue these opinions are outside the scope of the MEC’s authority,
inaccurately interpret the law, are not final, binding opinions, and Section 23 does not
expressly delegate authority to the MEC to issue interpretative advisory opinions.
The MEC has statutory authority to issue advisory opinions “regarding any issue
that the commission can receive a complaint on pursuant to Section 105.957.” Mo.
Rev. Stat. § 105.955.16(1). Section 105.957 enumerates provisions on which the MEC
may receive a complaint. Mo. Rev. Stat. § 105.957.1(1)-(6). Relevant to Plaintiffs’
challenge, the MEC may receive complaints regarding alleged violations of “the
constitution...relating to the official conduct of officials or employees of the state and
political subdivisions.” Mo. Rev. Stat. § 105.957.1(6). Plaintiffs note Defendants’
advisory opinions on provisions of Section 23 do not relate to the conduct of officials or
state employees. Nor does Section 23 expressly grant the MEC authority to receive a
complaint on the provisions at issue in this matter. See generally Section 23.13 Given
the uncertainty of whether the MEC has authority to issue these advisory opinions,
Plaintiffs urge the Court to confer standing to bring their claims.
If the MEC has authority to issue these advisory opinions, Plaintiffs argue an
advisory opinion may be withdrawn at any time by the MEC, the state legislature’s Joint
Committee on Administrative Rules, or the General Assembly. See Mo. Rev. Stat. §
105.955.16(1). During the hearing in this matter, the Court requested supplemental
briefing regarding whether previous MEC advisory opinions were rescinded, other than
in response to legislation superseding prior opinions. All parties filed supplemental
briefing on the matter. Docs. #76-78. Defendants state sixteen advisory opinions, of
407 total, were rescinded, and twelve of those rescissions occurred in response to new
legislation. Plaintiffs recognize several advisory opinions were rescinded after
legislative changes, but they cite to advisory opinions withdrawn after the MEC
determined the opinion incorrectly interpreted the law, an allegation made regarding
several advisory opinions at issue here. Plaintiffs also cite to an advisory opinion
regarding the Missouri Constitution’s nepotism clause that was allegedly withdrawn sua
sponte by the MEC.
Defendants note passage of section 105.957, delineating issues on which the
MEC may receive complaints, predates passage of Section 23, and argue the MEC has
inherent authority to interpret the law given its regulatory and administrative function
overseeing Missouri’s campaign finance laws. This is a reasonable position. Plaintiffs
argue the advisory opinions exceed the MEC’s authority, incorrectly interpret the law,
and do not provide reliable guidance on what conduct may be lawful because Plaintiffs
fear the opinions may be withdrawn. On the record before the Court, this is also a
While the Court has doubts that the potential rescission of an advisory opinion
would expose Plaintiffs to liability for an alleged violation occurring before rescission,
the Court need not decide whether the MEC exceeded its authority by issuing advisory
Section 23.4(1) allows the MEC to receive complaints from any person alleging a
violation of Section 23 “by any candidate for elective office.” The provisions at issue in
this matter do not challenge conduct by a candidate for elective office.
opinions interpreting Section 23 to address the merits of this matter. Regardless of the
validity of the advisory opinions, both parties advance arguments related to whether the
text of Section 23 violates the First Amendment and other constitutional provisions. As
explained below, the Court finds Plaintiffs have standing, and their claims are ripe for
the Court’s review.
(c) Plaintiffs’ Standing and Ripeness of Claims
Plaintiffs allege Section 23 affects their ability to contribute to various entities
and/or accept contributions from entities. AMEC-PAC desires to accept contributions
from its domestic and foreign member organizations not organized under chapters 347
through 360, but alleges Section 23 prevents it from accepting these contributions.14
AMEC-PAC further alleges it donated to other PACs in the past, and would do so again
in the future, but Section 23 prohibits it from doing so. Legends Bank made
contributions to PACs in the past, but alleges Section 23 now prohibits these
contributions because Legends Bank is not organized under chapters 347 through 360.
John Kleeba, Legends Bank’s President, Chairman of the Board, and General Counsel,
testified he made a contribution to the Missouri Bankers Association PAC days after
Section 23 became effective, but the contribution was returned. Kleeba further testified
Legends Bank stopped making contributions at this time.
FFEF wants to accept contributions from other Plaintiffs, but will not because it
fears investigation, prosecution, and sanctions. FFEF intends to raise funds in unlimited
amounts and use contributions to make independent expenditures in support of one or
more candidates in the 2018 Republican primary for Missouri State Auditor.15 Worker
Freedom wants to accept contributions from ADA, HSI, and Farmers, but will not accept
these contributions because it fears investigation, prosecution, and sanctions. Elliott
AMEC has at least one member that is not a Missouri domestic corporation, and is not
authorized to do business in Missouri pursuant to chapter 347. Case No. 17-4006, Doc.
#28, at 3.
FFEF will not use funds to make contributions, whether direct or in-kind to candidates
or candidate committees, except FFEF may contribute to other committees that also
intend to make only independent expenditures and do not make contributions to
candidates or political parties. FFEF does not engage in coordination with candidates,
candidate committees, political parties, or political party committees.
wants to contribute in excess of $2,600 to FFEF for the purpose of making independent
expenditures, and separately to candidate committees of more than one candidate in
the 2018 Republican primary for Missouri State Auditor, but not more than $2,600 to
any single candidate. Elliott will not make these contributions because he fears
investigation, prosecution, and sanctions. ADA wants to make a contribution in excess
of $2,600 per election to FFEF. Further, ADA would make a contribution to Worker
Freedom, but will not because it fears investigation, prosecution, and sanctions. HSI
wants to contribute in excess of $2,600 per election to FFEF and would contribute to
Worker Freedom, but will not because it fears investigation, prosecution, and sanctions.
Farmers wants to make a contribution in excess of $2,600 per election to FFEF and
would make a contribution to Worker Freedom, but will not because it fears
investigation, prosecution, and sanctions.
In this First Amendment case, Plaintiffs must demonstrate there is a credible
threat of enforcement or they engaged in self-censorship to establish standing. Relying
on Plaintiffs’ alleged misinterpretations of Section 23 and recent advisory opinions,
Defendants argue Plaintiffs do not face a credible threat of enforcement. A defendant’s
voluntary cessation of a challenged practice does not deprive a federal court of its
power to determine the legality of the practice. See City of Mesquite v. Aladdin’s
Castle, Inc., 455 U.S. 283, 289 (1982); United States v. W.T. Grant Co., 345 U.S. 629,
632 (1953). As discussed above, the Court finds Plaintiffs’ hesitancy to rely on the
MEC’s advisory opinions reasonable. Although the MEC has not brought an
enforcement action against Plaintiffs, the Court cannot determine Plaintiffs face no
credible threat of prosecution in light of Plaintiffs’ challenges to Section 23’s plain
In response to the Court’s questions regarding whether a county prosecutor may file
charges for violations of Section 23, Defendants stated “[n]othing in Chapter 56 and
nothing in the Missouri Constitution would prevent a prosecutor from filing charges
arising out of violations of” Section 23.3(14) (prohibiting transfers to committees with the
intent to conceal the true source of the contribution), and Section 23.6(1) (stating “[a]ny
person who purposely violates the provisions of section 3 of this Article is guilty of a
class A misdemeanor.”). Doc. #75. Although a county prosecutor could bring charges
for these violations, Defendants contend this Court cannot address this alleged chill
because Plaintiffs did not name a county prosecutor as a defendant in this matter. The
Plaintiffs’ strongest argument in favor of standing is their self-censorship. Selfcensorship must be objectively reasonable. Missourians for Fiscal Accountability, 830
F.3d at 794. As detailed above, Plaintiffs allege Section 23 prohibits them from
receiving and making their desired contributions. Violations of Section 23 may result in
criminal and monetary sanctions. Given confusion regarding the validity of the advisory
opinions, and confusion regarding what conduct Section 23 proscribes, Plaintiffs’ selfcensorship is objectively reasonable. Thus, Plaintiffs have standing.
Next, the Court must determine whether Plaintiffs’ claims are ripe for
adjudication. The parties agree two claims are ripe: (1) Section 23.3(12)’s prohibition
on contributions by entities not formed under chapters 347 through 360, and (2) Section
23.3(12)’s prohibition on PAC to PAC contributions. However, again relying on advisory
opinions and Plaintiffs’ alleged misinterpretations of Section 23, Defendants argue
Plaintiffs’ remaining claims are not ripe because Plaintiffs do not face criminal or civil
penalties for the conduct in which they wish to engage.
“To decide ripeness, courts 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 796-97 (citation omitted). Plaintiffs have refrained from making or
receiving desired contributions, and the Court heard testimony regarding Legends
Bank’s contribution to the Missouri Bankers Association being returned because Section
23 prohibited the contribution. Delayed review of the provisions at issue will further
impose on Plaintiffs’ ability to participate in political conduct in which they wish to
engage. Further, the MEC issued advisory opinions interpreting Section 23, and in this
regard, there is no judicial interference with any administrative action. Finally, the Court
has received extensive briefing and heard testimony on these issues. Further factual
development is not needed. Given these circumstances, the Court finds Plaintiffs’
claims are ripe.
The Court denies Defendants’ second motion to dismiss (Doc. #30) because the
Court finds Plaintiffs have standing and their claims are ripe. In light of the parties’
Court need not determine Plaintiffs’ speech was chilled on account of fear of
prosecution by a county prosecutor.
proposed consent judgment, the Court also finds claims related to Section 23’s ballot
measure ban should not be dismissed. Defendants’ arguments that several aspects of
Section 23 are lawful will be addressed below in the Court’s discussion of the merits of
Plaintiffs’ motions for injunctive relief.
B. Permanent Injunction
As detailed above, Plaintiffs initially sought preliminary injunctions. Given the
nature of this case and the need for a timely resolution, the Court converted the hearing
on Plaintiffs’ preliminary injunction motions to a hearing on Plaintiffs’ requests for
permanent injunction. Doc. #63. To obtain a preliminary injunction against an allegedly
unconstitutional state law, a plaintiff must prove the injunction’s necessity under the
factors set forth in Dataphase Systems, Inc., v. C L Systems, Inc., 640 F.2d 109, 114
(8th Cir. 1981). Gen. Motors Corp. v. Harry Brown’s, LLC, 563 F.3d 312, 316 (8th Cir.
2009). These factors are: (1) a “threat of irreparable harm to the movant”; (2) “the state
of balance between this harm” and any injury that granting the injunction will cause to
others; (3) the “probability that movant will succeed on the merits”; and (4) “the public
interest.” Dataphase, 640 F.2d at 114. “While no single factor is determinative, the
probability of success factor is the most significant.” Home Instead, Inc. v. Florance,
721 F.3d 494, 497 (8th Cir. 2013) (internal quotations and citations omitted). For a First
Amendment challenge, if a plaintiff does not show a likelihood of success on the merits,
it likely has not met the remaining requirements for preliminary injunction. Powell v.
Noble, 798 F.3d 690, 702 (8th Cir. 2015). “When a plaintiff has shown a likely violation
of his or her First Amendment rights, the other requirements for obtaining a preliminary
injunction are generally deemed to have been satisfied.” Minn. Citizens Concerned for
Life, Inc. v. Swanson, 692 F.3d 864, 870 (8th Cir. 2012) (hereinafter “MCCL”) (quoting
Phelps–Roper v. Troutman, 662 F.3d 485, 488 (8th Cir. 2011)).
“The standard for issuing a preliminary or permanent injunction is essentially the
same, excepting one key difference: a permanent injunction requires the moving party
to show actual success on the merits, rather than the fair chance of prevailing on the
merits required for a preliminary injunction. See Planned Parenthood Minn., N.D., S.D.
v. Rounds, 530 F.3d 724, 732 (8th Cir. 2008); Randolph v. Rodgers, 170 F.3d 850, 857
(8th Cir.1999). If a court finds a movant is actually successful on the merits, it then
considers the following factors in deciding whether to grant a permanent injunction: (1)
the threat of irreparable harm to the moving party; (2) the balance of harms with any
injury an injunction might inflict on other parties; and (3) the public interest. See
Planned Parenthood, 530 F.3d at 729 n.3; Dataphase, 640 F.2d at 113.
The Court first addresses the merits of Plaintiffs’ claims. Finding partial success
on the merits, the Court details appropriate injunctive relief.
(1) Level of Scrutiny
The Court must determine what level of scrutiny applies to Plaintiffs’ claims. The
Supreme Court has set forth different standards of review for different kinds of
campaign finance regulations. Wagner v. F.E.C., 793 F.3d 1, 5 (D.C. Cir. 2015) (citing
Buckley v. Valeo, 424 U.S. 1, 19-25 (1976); McCutcheon v. F.E.C., 134 S. Ct. 1434,
1444 (2014)). Laws limiting independent expenditures on electoral advocacy are
subject to strict scrutiny. Id. (citing McCutcheon, 134 S. Ct. at 1444); see, e.g., Citizens
United v. F.E.C., 558 U.S. 310, 339-41 (2010)). Laws regulating campaign
contributions “are subject to a lesser, but still rigorous standard of review because
contributions lie closer to the edges than to the core of political expression.” Id. (citing
F.E.C. v. Beaumont, 539 U.S. 146, 161 (2003)) (internal quotations omitted). The
applicable standard of review for a law regulating campaign contributions requires the
state to demonstrate a sufficiently important interest and to employ means closely
drawn to avoid unnecessary abridgement of associational freedoms. Id. Demonstrating
a law is “closely drawn” requires “‘a fit that is not necessarily perfect, but reasonable;
that represents not necessarily the single best disposition but one whose scope is in
proportion to the interest served[;]...that employs not necessarily the least restrictive
means but...a means narrowly tailored to achieve the desired objective.’” Wagner, 793
F.3d at 21 (quoting McCutcheon, 134 S. Ct. at 1456-57). The Eighth Circuit, of course,
follows the Supreme Court’s different standards of review. See MCCL, 692 F.3d at 878
(stating “[p]ut simply, ‘restrictions on contributions require less compelling justification
than restrictions on independent spending.’”) (quoting Beaumont, 539 U.S. at 158-59).
AMEC Plaintiffs urge the Court to apply strict scrutiny to invalidate portions of
Section 23. They argue strict scrutiny applies because laws burdening political speech
are subject to strict scrutiny. See Citizens United, 558 U.S. at 340; MCCL, 692 F.3d at
878 (“[c]ontributing to a political campaign is a form of political speech, as well as
association.”) (citing Buckley, 424 U.S. at 20-21)). However, the Supreme Court, in
Citizens United, recognized the “variance in the rigor of scrutiny used to review
independent expenditures and contributions...and neither endorsed nor condemned the
distinction.” MCCL, 692 F.3d at 878. The Supreme Court has repeatedly applied the
“closely drawn” standard to challenges to campaign contribution restrictions. See
Wagner, 793 F.3d at 5 n.3 (collecting cases). Furthermore, the Supreme Court has not
revisited Buckley’s distinction between contributions and expenditures, nor the
distinction between standards of review for these types of activities. Wagner, 793 F.3d
at 5 n.4 (collecting cases).
In Beaumont, the Supreme Court applied the “closely drawn” test to uphold a
federal law banning direct corporate campaign contributions. Beaumont, 539 U.S. at
149. The suggestion that Citizens United overruled Beaumont or “cast doubt” on its
precedential value has floated throughout various courts in the years after Citizens
United was decided. See, e.g., Wagner, 793 F.3d at 6; MCCL, 692 F.3d at 879 n.12.
However, the Eighth Circuit declined to disregard Beaumont, and applied the “closely
drawn” standard to a Minnesota law prohibiting corporate contributions to political
candidates and committees. MCCL, 692 F.3d at 879. The “closely drawn” standard
remains applicable in reviewing a law banning or limiting campaign contributions.
Wagner, 793 F.3d at 6 (collecting cases applying the “closely drawn” standard).
Plaintiffs do not allege Section 23 prevents them from making independent
expenditures in support or opposition of a candidate. Plaintiffs allege Section 23
prevents them from making and receiving contributions among themselves and other
entities. FFEF Plaintiffs also present a challenge to Section 23.3(1)(a)’s $2,600
contribution limit. Although a contribution limit burdens speech, it is not subject to strict
scrutiny. See Beaumont, 539 U.S. at 162 (“It is not that the difference between a ban
and a limit is to be ignored; it is just that the time to consider it is when applying scrutiny
at the level selected, not in selecting the standard of review itself.”). Accordingly, the
Court will apply the “closely drawn” standard to Plaintiffs’ claims.
(2) Interests Advanced by the State
Defendants must assert a sufficiently important interest in support of Section 23.
Defendants assert Section 23 promotes the important interests in preventing corruption
or the appearance thereof, promoting transparency, and preventing circumvention of
campaign finance regulations.17 The Supreme Court has repeatedly held the
government’s interest in preventing quid pro quo corruption or its appearance is
sufficiently important to justify regulation of campaign contributions. Wagner, 793 F.3d
at 8; McCutcheon, 134 S. Ct. at 1445; Buckley, 424 U.S. at 26-27. The Latin phrase,
quid pro quo, captures the notion of a direct exchange of an official act for money, and
such exchanges undermine the integrity of our system of representative democracy.
Wagner, 793 F.3d at 8 (citations omitted). The interest in preventing quid pro quo
corruption can even be a “compelling” interest that would satisfy strict scrutiny. Wagner,
793 F.3d at 8; McCutcheon, 134 S. Ct. at 1445.
The appearance of corruption is of equal concern because it can threaten the
citizenry’s confidence in the representative government system. Wagner, 793 F.3d at 8
Section 23 states:
The people of the State of Missouri hereby find and declare that excessive
campaign contributions to political candidates create the potential for
corruption and the appearance of corruption; that large campaign
contributions made to influence election outcomes allow wealthy
individuals, corporations and special interest groups to exercise a
disproportionate level of influence over the political process; that the rising
costs of campaigning for political office prevent qualified citizens from
running for political officer; that political contributions from corporations
and labor organizations are not necessarily an indication of popular
support for the corporation’s or labor organization’s political ideas and can
unfairly influence the outcome of Missouri elections; and that the interests
of the public are best served by limiting campaign contributions, providing
for full and timely disclosure of campaign contributions, and strong
enforcement of campaign finance requirements.
(citing Buckley, 424 U.S. at 26-27). Failing to address corruption or the appearance
thereof can give rise to the “cynical assumption that large donors call the tune [and]
jeopardize the willingness of voters to take part in democratic governance.” Nixon v.
Shrink Mo. Gov’t PAC, 528 U.S. 377, 390 (2000). The people of Missouri must have
faith in elected officials and their appointees. See Nixon, 528 U.S. at 390 (“Democracy
works only if the people have faith in those who govern, and that faith is bound to be
shattered when high officials and their appointees engage in activities which arouse
suspicions of malfeasance and corruption.”) (citation and quotations omitted).
Transparency in the electoral process serves the important government interest
to “provide information to the electorate about who is speaking – information that is vital
to the efficient functioning of the marketplace of ideas, and thus to advancing the
democratic objectives underlying the First Amendment.” Yamada v. Snipes, 786 F.3d
1182, 1197 (9th Cir. 2015) (citations and internal quotations omitted). “[T]ransparency
enables the electorate to make informed decisions and give proper weight to different
speakers and messages.” Citizens United, 558 U.S. at 371; see also Ala. Democratic
Conference v. Att’y Gen. of Ala., 838 F.3d 1057, 1065 (11th Cir. 2016) (“transparency is
plainly related to and furthers the State’s interest in preventing corruption and the
appearance of corruption....”). In addition, an interest in preventing circumvention of
valid contribution limits has been recognized as an important interest where there is
concern about corruption or the appearance thereof. See F.E.C. v. Colo. Republican
Fed. Campaign Comm., 533 U.S. 431, 456 (2001).
(3) Merits of Plaintiffs’ Claims
(a) Ballot Initiative Ban
Section 23.3(3)(a) states “[i]t shall be unlawful for a corporation or labor
organization to make contributions to a campaign committee, candidate committee,
exploratory committee, political party committee or a political party....” § 23.3(3)(a).
Section 23.3(16)(c) makes it unlawful for a “campaign committee, candidate committee,
continuing committee, exploratory committee, political party committee, and political
party” to knowingly accept contributions from “any foreign corporation that does not
have the authority to transact business in [Missouri] pursuant to chapter 347, RSMo, as
amended from time to time.” Section 23.7(6)(a) defines “campaign committee” as
a committee, other than a candidate committee, which shall be formed by
an individual or group of individuals, to receive contributions or make
expenditures and whose sole purpose is to support or oppose the
qualification and passage of one or more particular ballot measures in an
election or the retention of judges under the nonpartisan court plan....
Plaintiffs allege these provisions prevent them from contributing to a campaign
committee formed for the purpose of supporting or opposing one or more ballot
initiatives. A complete ban on corporate contributions to support or oppose ballot
initiatives is unconstitutional. See First Nat’l Bank v. Bellotti, 435 U.S. 765, 795 (1978)
(holding a Massachusetts statute prohibiting corporate expenditures on a tax
referendum violated the First Amendment). Citing Bellotti, Defendants indicated, in
briefing and during the hearing, they will not enforce Section 23’s restrictions on
corporate or union contributions to campaign committees whose only purpose is
supporting or opposing ballot initiatives. Doc. #31, at 23, 35-37. Plaintiffs are not
satisfied with Defendants’ assurances because such assurances have no legally
binding effect. At the conclusion of the hearing, counsel for all parties indicated a
willingness to discuss a possible consent judgment this Court could enter to resolve this
issue. Subsequently, the parties submitted a proposed consent order of permanent
injunction. Doc. #86. Accordingly, the Court incorporates the parties’ proposed consent
judgment and will enjoin enforcement of Section 23’s restrictions on corporate or union
contributions to campaign committees whose sole purpose is supporting or opposing
(b) Contribution Limits
FFEF Plaintiffs challenge Section 23.3(1)(a).18 Section 23.3(1)(a) prohibits
contributions in excess of $2,600 “made by or accepted from any person other than the
candidate in any one election...[t]o elect an individual to the office of governor,
AMEC Plaintiffs do not challenge Section 23.3(1)(a)’s contribution limit.
lieutenant governor, secretary of state, state treasurer, state auditor, attorney general,
office of state senator, office of state representative or any other state or judicial office.”
In Count V, Elliott alleges the $2,600 contribution limit applies to contributions
made “per election” rather than “per election, per candidate.” Put another way, Elliott
alleges Section 23 prevents him from making a $2,600 contribution to multiple
candidates running for the same office – i.e., he must spread his $2,600 between
hypothetical candidates A and B who are running for the same office enumerated in
Section 23.3(1)(a). For instance, if Elliott were to give $2,600 in a primary election to
candidate A, but candidate A later drops out, Elliott alleges Section 23.3(1)(a) prevents
him from then contributing to candidate B who remains in the race.
Defendants argue Section 23.3(1)(a) does not limit contributions to “one or more
candidates,” “multiple candidates” or “individuals.” Rather, the limit applies on
contributions to “elect an individual” to a singular office enumerated in the provision.
The limit plainly applies to contributions in a single election to elect a single individual to
an office.19 This is not an aggregate limit that impermissibly “restricts how much money
a donor may contribute in total to all candidates or committees.” McCutcheon, 134 S.
Ct. at 1442. Rather, this is a permissible base limit that “restricts how much money a
donor may contribute to a particular candidate or committee.” McCutcheon, 134 S. Ct.
at 1442. Accordingly, Elliott’s challenge is unfounded.
Count VI alleges Section 23.3(1)(a) prohibits ADA, Elliott, HSI, and Farmers from
making contributions in excess of $2,600 to FFEF even though FFEF is an independent
expenditure only committee. ADA, Elliott, HSI, and Farmers construe Section 23.3(1)(a)
as applying to all contributions made in an election, including contributions to PACs.
Plaintiffs argue they could not contribute a maximum amount of $2,600 to candidate A,
and then contribute additional funds to a PAC that makes independent expenditures in
support of or directly contributes to candidate A.
An “election” is “any primary, general or special election held to nominate or elect an
individual to public office, to retain or recall an elected officeholder or to submit a ballot
measure to the voters, and any caucus or other meeting of a political party or a political
party committee at which that party’s candidate or candidates for public office are
officially selected. A primary election and the succeeding general election shall be
considered separate elections.” § 23.7(11).
Defendants argue Section 23.3(1)(a) does not apply to contributions to PACs that
only make independent expenditures because a “contribution” does not include
contributions to independent expenditure only committees. Section 23.3(1)(a) does not
specifically state the contribution limit applies to PAC contributions. However, the
definition of “contribution” does not specifically exclude contributions to an independent
expenditure only committee. § 23.7(7). Defendants find support for their position in an
advisory opinion issued by the MEC. Advisory Opinion No. 2017.02.CF.003 states, “[i]t
is the Commission’s opinion that the contribution limits apply to candidate committees
and only to continuing committees/political action committees if a contribution to that
committee is restricted or designated for a candidate.” The MEC advises:
In order to satisfy the intent of the limitation, the contributing person must
intend for the contribution to be used for the election of an individual to
one of the enumerated offices. Therefore, the $2,600 contribution limit per
election presumptively does not apply to contributions received by a
continuing committee unless a contribution to a continuing committee has
been restricted or designated for a candidate. While the committee may
ultimately expend money advocating for a specific individual during a
campaign, the limitation specifically applies to ‘contributions made by or
accepted from any person.’ Thus, contributions made to enumerated
candidates by a continuing committee/ political action committee are
subject to the $2,600 limitation.
Advisory Opinion No. 2017.02.CF.003. The MEC further states “previous Commission
opinions also found that the contribution limits did not apply to contributions received by
continuing committees..., nor to campaign committees....” Id. The Court will enjoin
enforcement of Section 23.3(1)(a) in a manner inconsistent with Advisory Opinion No.
In Count VII, Elliott and FFEF allege Section 23.3(1)(a) is void for vagueness in
that a person of ordinary intelligence cannot discern what conduct is prohibited under
the amendment. Section 23.3(1)(a) is not a model of statutory clarity, but Elliott and
FFEF strain to interpret it in a manner that would result in finding it unconstitutional.
The plain language indicates contributions to elect an individual to an office shall not
exceed $2,600 in a single election. For what it is worth, the MEC’s advisory opinion
clarifies Section 23.3(1)(a)’s applicability to contributions made to a PAC – the MEC will
not enforce the $2,600 limit on contributions to a PAC unless the contribution is
specifically designated for an individual candidate. Advisory Opinion No.
2017.02.CF.003. At the hearing, Defendants indicated they do not oppose entry of an
injunction formalizing the MEC’s advisory opinions. The Court will enjoin the MEC from
interpreting Section 23.3(1)(a) in a manner inconsistent with Advisory Opinion No.
(c) Prohibitions on Entities Not Formed Under Chapters 347 through 360
The Court now turns to Plaintiffs’ challenge to Section 23’s prohibitions on the
sources of certain types of contributions. First, Plaintiffs challenge Section 23.3(16)(c),
which provides “[n]o campaign committee, candidate committee, continuing committee,
exploratory committee, political party committee, and political party shall knowingly
accept contributions from: Any foreign corporation that does not have the authority to
transact business in [Missouri] pursuant to Chapter 347, RSMo, as amended from time
to time.” § 23.3(16)(c). Chapter 347 governs only limited liability companies (“LLC”).
Second, Plaintiffs challenge Section 23.3(12), which provides “[p]olitical action
committees shall only receive contributions from individuals; unions; federal political
action committees; and corporations, associations, and partnerships formed under
chapters 347 to 360, RSMo, as amended from time to time.” § 23.3(12). Chapters 347
through 360 govern corporations, associations, and partnerships.
(i) Foreign Corporations
Plaintiffs’ first challenge involves Section 23.3(16)(c)’s prohibition on receiving
contributions from foreign LLCs, unless the LLC has a certificate of authority to do
business in Missouri.20 On its face, Section 23.3(16)(c) bans contributions from foreign
entities unless the contributing entity is an LLC authorized to do business in Missouri.
Defendants cannot and do not attempt to argue otherwise. However, Defendants
present an MEC advisory opinion interpreting this section, which states:
AMEC Plaintiffs’ Count I specifically attacks this provision, claiming the limitation is
facially unconstitutional and unconstitutional as-applied to Plaintiffs. FFEF Plaintiffs’
Count I broadly raises a challenge to the source contributions in Sections 23.3(12) and
(16)(c), but overlaps with a challenge to the heavily regulated entities prohibitions
§ 23.3(12) provides specific authorization for political action committees to
receive contributions from corporations, associations and partnerships
formed under those chapters, and § 23.3(16) appears to include a
prohibition for foreign corporations although referencing only one chapter
of the Missouri Revised Code. It is the Commission’s opinion that when
both sections are read together, and because the legislature has
expressly stated in those chapters listed in § 23.3(12) that foreign
corporations and other business entities shall have the same rights and
privileges as domestic corporations and business entities, political action
committees can receive contributions from foreign corporations,
associations or partnerships, holding valid certificates of authority to do
business in this state under chapters 347 to 360, RSMo.
Consistent with this analysis, the Commission interprets the prohibition on
contributions to foreign corporations in § 23.3(16)(c) not to extend to
foreign corporations that have registered to do business in the state under
Chapters 347 to 360, RSMo....
Advisory Opinion No. 2017.02.CF.006.
Chapters 347 through 360 provide a foreign corporation with a certificate of
authority to do business in Missouri has the same rights and privileges as an in-state
corporation. Mo. Rev. Stat. §§ 351.582.2, 356.031, 358.500, 358.510, 347.157. HSI, a
for-profit corporation organized under Kansas laws, has a certificate of authority to
transact business in Missouri pursuant to chapter 351. AMEC Plaintiffs’ Amended
Complaint lists KAMO Power, an Oklahoma corporation authorized to do business in
Missouri pursuant to chapter 355, as a rural electric cooperative that has contributed to
AMEC-PAC in the past, and wishes to do so in the future. AMEC-PAC believes Section
23.3(16)(c) prohibits it from receiving KAMO Power’s contribution, but Advisory Opinion
No. 2017.02.CF.006 indicates such a contribution is lawful in the MEC’s view.
As with several challenges in this matter, Defendants argue their advisory
opinions are legally binding, and therefore, the Court should find this claim is not ripe
because these foreign corporations have authority to transact business in Missouri
under chapters 347 through 360. Although the MEC’s advisory opinion potentially
provides clarity about Section 23.3(16)(c)’s application, the Court finds the entry of a
permanent injunction enjoining enforcement of Section 23.3(16)(c) in a manner
inconsistent with Advisory Opinion No. 2017.02.CF.006 appropriate. Accordingly, the
Court will enjoin enforcement of Section 23.3(16)(c) in a manner inconsistent with
Advisory Opinion No. 2017.02.CF.006.
(ii) Prohibition on Heavily Regulated Industries
Plaintiffs’ second challenge involves the source prohibition on corporate entities
found in Section 23.3(12), which restricts PACs to receiving contributions only from
corporations, associations, and partnerships formed under chapters 347 through 360.
Defendants term this limitation as one banning “heavily regulated industries” from
contributing to PACs. While direct contributions to candidates, committees, and political
parties by all corporations and unions are prohibited by Section 23.3(3)(a), Section
23.3(12) imposes a further restriction by banning contributions to PACs by these heavily
Defendants define a heavily regulated entity as one not formed under chapters
347 through 360. Although not an exhaustive list, businesses in a heavily regulated
industry, applying Defendants’ definition, include state-chartered banks and trust
companies (chapters 362 and 363), loan and investment companies (chapter 368),
savings and loan associations (chapter 369), credit unions (chapter 370), development
finance corporations (chapter 371), fraternal benefit societies (chapter 378), insurance
companies (chapter 375 through 385), railroad corporations (chapter 388), telegraph
and telephone companies (chapter 392), and cooperative, nonprofit, membership
corporations (chapter 394). Businesses in these heavily regulated industries may make
independent expenditures, and may establish continuing committees for contributions
from members or shareholders that can then donate to candidates or other groups. §
The ban on PAC contributions by businesses in heavily regulated industries
affects multiple Plaintiffs. AMEC’s member rural electric cooperatives are organized
under chapter 394, and these organizations have contributed and wish to continue
contributing to AMEC-PAC. Legends Bank and Farmers are state-chartered banks
organized under chapter 362 that wish to contribute to PACs. Defendants maintain the
ban on heavily regulated industries is constitutional, while Plaintiffs argue the ban is not
closely drawn to a sufficiently important interest.
All parties agree Blount v. Securities Exchange Commission, 61 F.3d 938 (D.C.
Cir. 1995), should guide the Court’s review of this issue. There, regulators of municipal
securities markets investigated reports of “ethically questionable practices” by municipal
bond traders and became concerned these practices “were becoming more prevalent
and were undermining the integrity of the $250 billion municipal securities market.” 61
F.3d at 939. In response to this concern, the Securities Exchange Commission (“the
Commission”) approved new rules restricting the “ability of municipal securities
professionals to contribute to and to solicit contributions to the political campaigns of
state officials from whom they obtain business.” Id. Under the new rules, a municipal
securities professional is prohibited from engaging with an official of an issuer for a
period of two years if the professional contributed to the official. Id. at 940. A
contribution to a PAC is treated as a contribution to the official if the PAC is controlled
by the official or “any municipal finance dealer whatsoever.” Id. Further, the two-year
restriction is not triggered by a contribution of less than $250 per official, per election,
and if the securities professional is entitled to vote for the official. Id.
Applying strict scrutiny, the District of Columbia Circuit Court upheld the rule
under First and Tenth Amendment challenges.21 Id. at 949. Despite the lack of specific
evidence of a quid pro quo, the court noted:
underwriters’ campaign contributions self-evidently create a conflict of
interest in state and local officials who have power over municipal
securities contracts and a risk that they will award the contracts on the
basis of benefit to their campaign chests rather than to the governmental
Id. at 944-45. In approving the rule, the Commission noted specific allegations of abuse
in local and state governments, and cited newspaper clippings from thirteen states and
the District of Columbia bolstering these allegations. Id. The court noted, “[a]lthough
the record contains only allegations, no smoking gun is needed where...the conflict of
After a detailed analysis of whether the rule was content-based or content-neutral in
light of the rule’s suppression of speech, the court was “hesita[ant] to find the rule
content-neutral.” Blount, 61 F.3d at 943. The parties here engage in a brief discussion
of whether this Court should apply strict scrutiny to Section 23 because the law
seemingly favors content of certain corporations over others. As the Court explained
above, application of the “closely drawn” standard here is appropriate given its
application in the campaign finance context. Wagner, 793 F.3d at 6.
interest is apparent, the likelihood of stealth great, and the legislative purpose
prophylactic.” Id. (citing F.E.C. v. Nat’l Right to Work Comm., 459 U.S. 197, 210
In light of the record, the court upheld the narrow rule. The rule applied only to
the two potential parties to a quid pro quo, and did not apply to business awarded on a
competitive basis. Id. at 947 n.5. The rule restricted only a narrow range of activity for
a relatively short period of time. Id. Lastly, the court noted several ways the rule did not
restrict political activity, such as the ability to make direct expenditures, give speeches,
volunteer for political candidates, generally solicit support as opposed to requesting
money, and solicit funds for a political party. Id. at 948.
Section 23.3(12) is distinguishable from the rule at issue in Blount. The rule in
Blount is a targeted prohibition on contributions directly to a candidate, and only for a
limited period of time. Section 23.3(12) is a complete prohibition on contributions to
PACs by entities not formed under chapters 347 through 360. The Supreme Court has
held, “there is not the same risk of quid pro quo corruption or its appearance when
money flows through independent actors to a candidate, as when a donor contributes to
a candidate directly.” McCutcheon, 134 S. Ct. at 1452. The possibility of a quid pro quo
between municipal bond traders and local and state governments is apparent in a direct
contribution, but is not apparent in this case, where a PAC independently contributes to
In addition to Blount, Defendants direct the Court to several cases purportedly
supporting an outright ban on PAC contributions by businesses in heavily regulated
industries. While a “particular threat to the integrity of State government posed by
political contributions from participants in [a] tightly regulated industry” may be found in
direct contributions to candidates, none of Defendants’ cited cases stand for the
proposition that an outright ban on PAC contributions passes constitutional muster.
See, e.g., Green Party of Conn. v. Garfield, 616 F.3d 189, 213 (2d Cir. 2010) (upholding
a limited portion of a statute prohibiting state contractors from making campaign
contributions directly to candidates for state office); In re Earle Asphalt Co., 950 A.2d
918, 923 (N.J. Super. 2008) (upholding a statute preventing a state agency from
awarding a contract with a value over $17,500 to a business entity that contributed more
than $300 during the preceding eighteen months to the Governor, candidates for
Governor, or any state or county political party); Gwinn v. State Ethics Comm’n, 426
S.E.2d 890, 892 (Ga. 1993) (upholding a statute that prohibited insurance companies
from making campaign contributions to candidates for or occupants of the Office of
Commissioner of Insurance).
While prohibitions on a limited class of businesses or individuals have been
upheld, Section 23.3(12) draws no such distinction beyond a large grouping of
businesses in what Defendants term heavily regulated industries. See, e.g., Wagner,
793 F.3d at 22 (upholding a ban on indirect and direct contributions to any political
party, committee, or candidate by federal contractors during the period of contract
negotiation and performance); Casino Ass’n of La. v. State ex rel. Foster, 820 So.2d
494, 495 (La. 2002) (upholding a statute prohibiting campaign contributions by riverboat
and land-based casino industries); In re Petition of Soto, 565 A.2d 1088, 1106 (N.J.
Super. 1989) (upholding a statute prohibiting a casino officer or key employee from
contributing to a candidate for public office or any party or group organized to support
such a candidate).
Defendants have not demonstrated Section 23.3(12)’s ban on PAC contributions
by either state-chartered banks or rural electric cooperatives is closely drawn to the
government’s interests. Defendants indicated they developed a list of heavily regulated
industries by researching the chapters under which the business is formed and
examining the regulations imposed on the business or industry, but the Court can find
little commonality among these businesses other than being organized outside title XXIII
of the Missouri Revised Statutes. Certainly, not every business entity organized outside
title XXIII is involved in a highly regulated industry. Defendants cite a particular danger
of corruption or the appearance of corruption because these businesses are heavily
regulated by the legislators to whom they wish to contribute. However, Section 23.3(12)
is a ban on PAC contributions as opposed to contributions to candidates, and “there is
not the same risk of quid pro quo corruption or its appearance when money flows
through independent actors to a candidate, as when a donor contributes to a candidate
directly.” McCutcheon, 134 S. Ct. at 1452.
Contributions to a PAC by a rural electric cooperative do not implicate the
concerns raised by Defendants. Public utilities are regulated by the Public Service
Commission, an independent executive agency, on myriad issues. Rural electric
cooperatives are regulated only on one, the issue of safety.22 Defendants argue there is
no buffer between rural electric cooperatives and their state representatives, and this
lack of a buffer requires regulation of rural electric cooperatives’ contributions because
there is a heightened concern of quid pro quo and perceived corruption. That may be
so, but Section 23.3(12) prohibits contributions to PACs, not direct contributions to
candidates as in Blount and other cases cited by Defendants. The heightened risk of a
quid pro quo exchange simply does not exist in a contribution to a PAC that
independently decides how to spend a contributor’s funds.
Likewise, Defendants do not establish a ban on contributions to a PAC by a
state-chartered bank implicates the concerns they raised. The Court acknowledges a
history of corruption or the appearance of corruption involving contributions by banking
entities previously served as the basis for the implementation of campaign contribution
limits in Missouri. See Nixon, 528 U.S. at 394-95. Defendants assert state-charted
banks are properly characterized as a heavily regulated industry because chapter 362,
and other regulations and statutes, impose numerous restrictions and requirements on
state-chartered banks.23 The financial industry faces complex laws and regulations, but
the Court again fails to see how contributions to a PAC by a state-chartered bank raise
the same risk of quid pro quo corruption or its appearance as a direct contribution to a
The Court also questions Defendant’s identification of a rural electric cooperative as a
heavily regulated industry. These entities generally do not seek business directly from
the state; rather, they provide services to rural areas to which public utilities do not
provide service. Moreover, Defendants have not shown rural electric cooperatives have
been involved in corruption or even the appearance of corruption. The Court did not
delve further into this particular issue because the Court finds this particular section is
not narrowly drawn.
The Court acknowledges the banking industry is more heavily regulated than rural
electric cooperatives. However, Defendants fail to demonstrate state-chartered banks
are a heavily regulated industry in which there is evidence of corruption or the
appearance of corruption in PACs associated with state-chartered banks. To the extent
Defendants argue otherwise, the Court finds Defendants’ allegations are broad and
generalized. This Court will not uphold Section 23.3(12)’s ban on PAC contributions.
Plaintiffs also bring a facial challenge to this portion of Section 23. As explained
above, the Court finds Defendants have not demonstrated Section 23.3(12)’s ban on
contributions to PACs from rural electric cooperatives organized under chapter 394, or
state-chartered banks organized under chapter 362, is closely drawn to avoid
unnecessary abridgement of Plaintiffs’ First Amendment freedoms. As the Supreme
Court has held, “there is not the same risk of quid pro quo corruption or its appearance
when money flows through independent actors to a candidate, as when a donor
contributes to a candidate directly.” McCutcheon, 134 S. Ct. at 1452. Here, Section
23.3(12) prohibits contributions through independent actors, PACs, that do not raise the
same risk of quid pro quo corruption or the appearance thereof. Consequently, the
Court finds the outright ban on contributions to PACs by businesses not formed under
chapters 347 through 360 is unconstitutional.
(d) PAC to PAC Contribution Ban
Plaintiffs also allege Section 23.3(12)’s prohibition on PAC to PAC contributions
is unconstitutional. Section 23.3(12) provides “[p]olitical action committees...shall be
prohibited from receiving contributions from other political action committees, candidate
committees, political party committees, campaign committees, exploratory committees,
or debt service committees.” § 23.3(12). A “political action committee” is defined as
a committee of continuing existence which is not formed, controlled or
directed by a candidate, and is a committee other than a candidate
committee, political party committee, campaign committee, exploratory
committee, or debt service committee, whose primary or incidental
purpose is to receive contributions or make expenditures to influence or
attempt to influence the action of voters whether or not a particular
candidate or candidates or a particular ballot measure or measures to be
supported or opposed has been determined at the time the committee is
required to file any statement or report pursuant to the provisions of this
chapter. Such a committee includes, but is not limited to, any committee
organized or sponsored by a business entity, a labor organization, a
professional association, a trade or business association, a club or other
organization and whose primary purpose is to solicit, accept and use
contributions from the members, employees or stockholders of such entity
and any individual or group of individuals who accept and use
contributions to influence or attempt to influence the action of voters....
§ 23.7(20). AMEC-PAC and FFEF allege they are unconstitutionally prohibited from
making contributions to and receiving contributions from other PACs organized under
Missouri law. Defendants assert this prohibition is necessary to prevent corruption or
the appearance of corruption, promote transparency in the flow of money, and prevent
circumvention of Section 23’s restrictions.
There are differences between FFEF and AMEC-PAC, and those differences
affect the Court’s analysis. FFEF is a PAC whose purpose is to receive contributions
and make independent expenditures to influence voters. FFEF does not contribute to
candidates or their committees. FFEF does not intend to make contributions to political
parties, and does not engage in coordination with candidates, candidate committees,
political parties, or political party committees.
AMEC-PAC has contributed and wishes to contribute in the future to candidates
and their committees. AMEC-PAC has never accepted contributions specifically
designated to be contributed to a candidate. AMEC-PAC has received contributions
from other PACs in the past and wishes to receive these contributions in the future.
Finally, AMEC-PAC has made contributions to other PACs in the past and wishes to do
so again in the future. The Court heard testimony from Klindt, AMEC’s former Vice
President and treasurer of AMEC-PAC, regarding AMEC-PAC’s contributions to “Pork
PAC” as an example of the types of contributions AMEC-PAC would make but for
Section 23.3(12)’s ban on PAC to PAC contributions.
Although FFEF and AMEC-PAC challenge the constitutionality of Section
23.3(12)’s ban on PAC to PAC contributions, their challenges differ based upon the
conduct in which each party wishes to engage. FFEF’s challenge is, in a sense,
narrower. FFEF seeks only for a judicial determination that Section 23.3(12) is
unconstitutional when applied to PACs that only engage in independent expenditures.
AMEC-PAC brings a broader challenge, arguing the PAC to PAC contribution ban is
unconstitutional when applied to PACs that contribute to candidates, as well as PACs
that make independent expenditures.
(i) Independent Expenditure Only PACs
Defendants, in the context of this matter, state Section 23.3(12)’s ban does not
apply to a PAC that seeks to receive funds from another PAC, but only uses its funds to
make independent expenditures. Defendants cite Section 23’s definition of
“contribution” to support their position. Section 23.7(7) defines a “contribution” as
a payment, gift, loan, advance, deposit, or donation of money or anything
of value for the purpose of supporting or opposing the nomination or
election of any candidate for public office or the qualification, passage, or
defeat of any ballot measure, or for the support of any committee
supporting or opposing candidates or ballot measures or for paying debts
or obligations of any candidate or committee previously incurred for the
§ 23.3(7). Defendants argue this language does not apply to contributions to PACs
making only independent expenditures. Furthermore, the MEC issued Advisory Opinion
No. 2017.02.CF.004, which states, “[w]hile the Missouri Constitution and Chapter 130
do not specifically refer to ‘independent expenditures,’ the [MEC] has long given
guidance that expenditures made by a candidate do not constitute contributions if those
expenditures were ‘not requested to be made by, directed or controlled by, or made in
cooperation with, or made with the express or implied consent of the candidate.’” The
advisory opinion further states, “§ 23.3(4) and § 23.3(12) place prohibitions on
contributions and not expenditures by a candidate committee to other candidate
committees and political action committees/continuing committees.”
Although Defendants indicate they will not enforce Section 23.3(12) in the
manner feared by FFEF, case law is also instructive on this issue. The Supreme Court
has recognized “independent expenditures do not lead to, or create the appearance of,
quid pro quo corruption.” Citizens United, 558 U.S. at 360. Because an independent
expenditure is political speech that is not coordinated with a candidate, a state’s interest
in preventing corruption or the appearance of corruption may not justify regulation of
independent expenditures when a contribution to or coordination with a candidate is not
present. See Ala. Democratic Conference, 838 F.3d at 1066, cert denied, 2017 WL
1427593 (Apr. 24, 2017). Circuit Courts throughout the country have applied this
reasoning to invalidate laws limiting contributions to independent expenditure only
PACs. See, e.g., Republican Party of N.M. v. King, 741 F.3d 1089, 1097 (10th Cir.
2013); N.Y. Progress & Prot. PAC v. Walsh, 733 F.3d 483, 487 (2d Cir. 2013); Texans
for Free Enter. v. Tex. Ethics Comm’n, 732 F.3d 535, 538 (5th Cir. 2013); Wis. Right to
Life State Political Action Comm. v. Barland, 664 F.3d 139, 154 (7th Cir. 2011);
Thalheimer v. City of San Diego, 645 F.3d 1109, 1121 (9th Cir. 2011); SpeechNow.org
v. F.E.C., 599 F.3d 686, 696 (D.C. Cir. 2010) (en banc).
Defendants urge this Court to find FFEF’s challenge is not ripe because
Defendants interpret Section 23 in a way that does not injure FFEF. However, based
on the case law described above, Section 23.3(12)’s prohibition against a PAC’s
contribution to another PAC is impermissible when applied to an independent
expenditure only PAC. Although Defendants interpret “contribution” in a manner that
does not encompass contributions to an independent expenditure only PAC, this
interpretation is not apparent based on Section 23’s language.24 As Defendants admit,
Section 23 does not define “independent expenditure,” nor is it clear that a contribution
to an independent expenditure only PAC from another PAC would not run afoul of
Section 23.3(12). Given the case law on this issue, the Court will enjoin enforcement of
Section 23.3(12) prohibiting FFEF from receiving a contribution from another PAC.
(ii) PACs that May Contribute to Candidates and Other PACs
AMEC-PAC argues Section 23.3(12)’s PAC to PAC contribution ban is
unconstitutional when applied to PACs that contribute to candidates, as well as PACs
that make independent expenditures. AMEC-PAC argues there is no risk of corruption
or the appearance of corruption in a PAC to PAC contribution, as opposed to the state’s
interest in regulating contributions directly to candidates which do raise a risk of
corruption or the appearance thereof. Defendants argue a PAC to PAC contribution
raises the risk of corruption or the appearance thereof, and the prohibition serves the
Section 23 defines “contribution” as something given “for the support of any
committee supporting or opposing candidates or ballot measures....” § 23.7(7). While
an independent expenditure only PAC operates independent of a candidate and
candidate committee, an independent expenditure is nonetheless made in support of a
candidate or ballot measure. The Court fails to see how a contribution to an
independent expenditure only PAC does not qualify as a “contribution” as defined by
government’s interest in preventing evasion or circumvention of Section 23’s
contribution limits to candidates.
Defendants direct the Court to case law in which a limit on contributions to a PAC
was challenged. In California Medical Association v. Federal Election Commission, 453
U.S. 182 (1981), the Supreme Court upheld a statute that prohibited individuals and
unincorporated associations from contributing more than $5,000 per year to any
“multicandidate political committee.”25 453 U.S. at 185. The Supreme Court examined
Buckley, a contribution limits decision, and found a contributor’s rights were not
impaired by the statute’s limit on contributions to a multicandidate political committee.
Cal. Med., 453 U.S. at 197. The statute at issue in California Medical Association did
not address PAC to PAC contributions.
The Eleventh Circuit’s decision in Alabama Democratic Conference v. Attorney
General of Alabama, 838 F.3d 1057 (2016), involves a prohibition on PAC to PAC
contributions. There, Alabama law prohibited a PAC designed to contribute to several
candidates, like AMEC-PAC, from contributing to another PAC that also contributed to
candidates. 838 F.3d at 1060. The Eleventh Circuit found, as-applied to the plaintiff,
the “ban serves an important anti-corruption interest while only marginally impacting
political dialogue.” Id. at 1070. Critically, Alabama’s campaign finance law “does not
limit the amount of money that a person, business, or PAC may contribute directly to a
candidate’s campaign.” Id. at 1060. Because Alabama did not limit candidate
contributions, the state had an important interest in preventing quid pro quo corruption
that could arise from contributions to the plaintiff PAC. Id. at 1070.
Here, Defendants assert an interest in preventing corruption or the appearance
thereof, and preventing evasion of contribution limits, but the Court is not persuaded
Section 23.3(12) is closely drawn to achieve these goals. Under Missouri law, a
“political action committee” is an independent actor. See § 23.7(20) (defining a PAC as
“a committee of continuing existence which is not formed, controlled or directed by a
A “multicandidate political committee” is one that, relevant to this matter, “has
received contributions from more than 50 persons, and...has made contributions to 5 or
more candidates for Federal Office.” Cal. Med., 453 U.S. at 185 n.1. The Court
considers a “multicandidate political committee” to be similar to AMEC-PAC in that
AMEC-PAC wishes to contribute to candidates.
candidate, and is a committee other than a candidate committee, political party
committee, campaign committee, exploratory committee, or debt service committee,
whose primary or incidental purpose is to receive contributions or make expenditures to
influence or attempt to influence the action of voters....” (emphasis added)). Given this
status as an independent actor, the Supreme Court’s guidance in McCutcheon once
again applies, leading the Court to conclude Defendants do not have a valid interest in
preventing corruption or the appearance thereof by regulating PAC to PAC transfers by
imposing an absolute ban as Section 23.3(12) does. See McCutcheon, 134 S. Ct. at
1452 (stating “there is not the same risk of quid pro quo corruption or its appearance
when money flows through independent actors to a candidate, as when a donor
contributes to a candidate directly. When an individual contributes to a candidate, a
party committee, or a PAC, the individual must by law cede control over the funds.”).
Defendants also cite an important interest in preventing evasion or circumvention
of Section 23’s contribution limits as a reason to uphold the PAC to PAC contribution
ban. The Supreme Court and many circuits have found this is a valid interest. See,
e.g., Cal. Med., 453 U.S. at 197-98; N.C. Right to Life, Inc. v. Leake, 525 F.3d 274, 292
(4th Cir. 2008); Catholic Leadership Coal. of Tx. v. Reisman, 764 F.3d 409, 444 (5th Cir.
2014). However, AMEC-PAC and other Plaintiffs have not asserted a PAC is not
subject to Section 23.3(1)(a)’s $2,600 contribution limit. In fact, AMEC Plaintiffs
specifically state they are subject to these limits. See Doc. #34, at 3-4 (stating “Plaintiffs
are not challenging the $2,600 limit on contributions from PACs to candidates found in
Article VIII, Section 23” and “[i]n Missouri, PACs make both candidate contributions
(subject to the $2,600 limit) and independent expenditures.”).26
Finally, the Court notes the absolute prohibition, as opposed to a limit, imposed
by Section 23.3(12). “In determining whether a contribution limit is ‘closely drawn,’ the
Supreme Court has suggested that ‘the amount, or level, of that limit could make a
difference.’” Ala. Democratic Conference, 838 F.3d at 1069 (quoting Randall v. Sorrell,
The Court agrees with AMEC Plaintiffs’ reading of Section 23. A “person” is subject
to the $2,600 contribution limit. § 23.3(1)(a). A “committee” is included in the definition
of a “person.” § 23.7(19). The term “committee” includes a “continuing committee.” §
23.7(6). A “continuing committee” is the same as a “political action committee.”
Advisory Opinion No. 2017.02.CF.003.
548 U.S. 230, 247 (2006)). As the Court has repeatedly noted, Section 23.3(12)
imposes an absolute prohibition on PAC to PAC contributions. The Court has found no
similar statute or state constitutional amendment. While evasion of campaign finance
limits is an important interest, Section 23.3(12)’s absolute prohibition on PAC to PAC
transfers is not closely drawn to serve this interest when Section 23’s contribution limits
apply to PAC contributions to candidates and their committees. Moreover, Defendants
do not have an interest in preventing corruption or the appearance thereof in PAC to
PAC contributions among entities that are, by law, independent actors. Accordingly, the
Court finds Section 23.3(12)’s ban on PAC to PAC contributions is unconstitutional.
The Court will enjoin enforcement of Section 23.3(12)’s ban on PAC to PAC
(4) Remaining Dataphase Factors
Although probability of success is the most significant factor, the Court must
address the remaining Dataphase factors. These factors are: (1) a “threat of irreparable
harm to the movant”; (2) “the state of balance between this harm” and any injury that
granting the injunction will cause to others; and (3) “the public interest.” Dataphase, 640
F.2d at 114. If a plaintiff shows a violation of a constitutional right, the other
requirements for injunctive relief are generally satisfied. See MCCL, 692 F.3d at 870.
Because the Court determined Plaintiffs established a violation of their
constitutional rights, the other requirements for injunctive relief are generally satisfied.
See MCCL, 692 F.3d at 870. The Court will briefly review these requirements. A loss
of First Amendment rights poses a threat of irreparable harm to Plaintiffs. See Elrod v.
Burns, 427 U.S. 347, 373 (1973) (holding “[t]he loss of First Amendment freedoms,
even for minimal periods of time, unquestionably constitutes irreparable injury.”).
Plaintiffs also seek a quick resolution of this matter so they may participate in ongoing
legislative sessions and begin raising funds with which they will participate in upcoming
elections. Furthermore, the Court finds granting a permanent injunction in this matter
During this course of litigating this matter, Defendants questioned whether FFEF was
a true independent expenditure only PAC. The Court finds Section 23.3(12) is facially
unconstitutional, and unconstitutional as-applied to FFEF. Therefore, the Court does
not address argument regarding FFEF’s independence.
strikes a balance between the harms Plaintiffs face, and the harm granting this
permanent injunction will cause to others. The Court recognizes Section 23 was
passed by an overwhelming majority of Missouri voters. However, the Court but must
balance the public’s vote for campaign finance reforms with Plaintiffs’ rights to engage
in constitutionally protected conduct. The Court does not find Section 23
unconstitutional in full, but rather will enter a permanent injunction severing
unconstitutional portions of Section 23, while upholding many provisions consistent with
the MEC’s advisory opinions. Finally, the public interest is in favor of protecting First
Amendment freedoms. See Phelps-Roper v. Nixon, 545 F.3d 685, 690 (8th Cir. 2008)
(stating “it is always in the public interest to protect constitutional rights.”). For these
reasons, the Court finds the remaining Dataphase factors weigh in favor of granting
Plaintiffs’ motions for permanent injunctive relief.
The Court grants Defendants’ first motion to dismiss (Doc. #28). AMEC Plaintiffs’
claims against the State of Missouri are dismissed, and their state-law claims are
dismissed without prejudice. The Court denies Defendants’ second motion to dismiss
(Doc. #30). The Court dismisses Count II of FFEF Plaintiffs’ Complaint, pursuant to
FFEF Plaintiffs’ representation that they are abandoning this claim.
The Court partially grants Plaintiffs’ motions for permanent injunction. Case No.
17-4006, Doc. #14; Case No. 14-4332, Doc. #18. In granting Plaintiffs’ motions, the
Court does not enjoin enforcement of Section 23 in its entirety. The Court finds
unconstitutional portions of Section 23 are severable consistent with Section 23’s
severability provision. See § 23.8.
It is therefore Ordered:28
1. The Court permanently enjoins Defendants29 from enforcing Article VIII,
Sections 23.3(3) and 23.3(16)(c) of the Missouri Constitution against a
In proscribing injunctive relief, the Court uses terms as defined in Article VIII, Section
23 of the Missouri Constitution.
“Defendants” include the Missouri Ethics Commission, James Klahr in his official
capacity as Executive Director of the Missouri Ethics Commission, Commissioners
Nancy Hagan, and Vice Chairs Bill Deeken, Eric L. Dirks, Don Summers, Kim Benjamin,
corporation or labor organization for making a contribution to a campaign
committee that only supports or opposes ballot measures.
2. The Court permanently enjoins Defendants from enforcing Article VIII,
Section 23.3(1)(a) of the Missouri Constitution against a person whose
contribution to elect a single individual to office in a single election does
not exceed $2,600 per election, allowing for an adjustment of the
contribution limit as described in Section 23.3(18).
3. The Court permanently enjoins Defendants from enforcing Article VIII,
Section 23.3(1)(a) of the Missouri Constitution against a person who
contributes to a continuing committee or political action committee unless
the contribution is restricted or designated for a specific candidate as
Missouri Ethics Commission Advisory Opinion No. 2017.02.CF.003
4. The Court permanently enjoins Defendants from enforcing Article VIII,
Section 23.3(16)(c) of the Missouri Constitution against a continuing
committee or political action committee that accepts contributions from a
foreign corporation that has authority to transact business in Missouri
pursuant to chapters 347 through 360 of the Missouri Revised Statutes.
This is consistent with Missouri Ethics Commission Advisory Opinion No.
5. The Court permanently enjoins Defendants from enforcing Article VIII,
Section 23.3(12) of the Missouri Constitution’s prohibition against political
action committees receiving contributions from entities formed outside of
chapters 347 through 360 of the Missouri Revised Statutes.
6. The Court permanently enjoins Defendants from enforcing Article VIII,
Section 23.3(12) of the Missouri Constitution’s prohibition on political
action committees receiving contributions from other political action
and George Ratermann, and including successors, current and future officers, agents,
servants, employees, and all other persons in active concert of participation with them.
At the hearing, Defendants requested this Court stay any injunctive relief ordered
to allow Defendants the opportunity to appeal this Court’s decision. The Court grants
this request. The Court stays enforcement of the May 5, 2017 Order for a period of
forty-five days after entry of the May 5, 2017 Order.
IT IS SO ORDERED.
/s/ Ortrie D. Smith
ORTRIE D. SMITH, SENIOR JUDGE
UNITED STATES DISTRICT COURT
DATE: May 17, 2017
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