Montanans for Community Development v. Motl et al
Filing
176
ORDER granting 119 Motion for Summary Judgment; denying 125 Motion for Summary Judgment; denying 125 Motion for Hearing; granting 169 Motion to Strike. This case is CLOSED. Signed by Chief Judge Dana L. Christensen on 10/31/2016. (DLE)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MONTANA
HELENA DIVISION
MONTANANS FOR COMMUNITY
DEVELOPMENT,
CV 14–55–H–DLC
Plaintiff,
ORDER
vs.
JONATHAN MOTL, in his official
capacity as Commissioner of Political
Practices; TIMOTHY FOX, in his
official capacity as Attorney General
of the State of Montana, and LEO
GALLAGHER, in his official capacity
as Lewis and Clark County Attorney,
Defendants.
Before the Court are the parties’ cross-motions for summary judgment. For
the reasons explained below, the Court grants Defendants’ motion and denies
Plaintiff’s motion.
FACTUAL AND PROCEDURAL BACKGROUND
A. Montanans for Community Development
Plaintiff Montanans for Community Development (“MCD”) is a selfidentified tax exempt “social welfare organization” under 26 U.S.C. 501(c)(4).
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This group asserts that it is a non-partisan organization that is not affiliated with
any political candidate or political party. MCD’s stated mission is “to promote
and encourage policies that create jobs and grow local economies throughout
Montana.” (Doc. 100 at 17.) The organization seeks to accomplish this goal by
“engag[ing] in grassroots advocacy and issues-oriented educational campaigns.”
(Id.)
MCD was organized at an initial meeting on October 2, 2013, and has only
had one formal meeting since. MCD has no reported members, telephone number,
email address, or website. Though MCD filed Articles of Incorporation with the
Montana Secretary of State shortly after its initial meeting, its status as a Montana
corporation was dissolved by the Secretary of State on December 1, 2015. MCD
has neither applied for nor received recognition from the Internal Revenue Service
regarding its purported tax exempt status.
MCD has stated an intention to engage in political speech through the
circulation of issue advertisements, otherwise known as mailers. MCD asserts that
it intended to circulate certain “issue advocacy” mailers as recently as September
2014, or roughly 60 days before the 2014 general election. (Doc. 100 at 17–18.)
Although a template of these mailers was prepared by MCD, copies were not
distributed out of concern that the organization would have been penalized by
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Montana’s Commissioner of Political Practices (the “Commissioner”) for failing
to comply with Montana’s campaign disclosure and reporting laws.
The template was attached to MCD’s complaint and consisted of two
mailers.1 The first mailer read: “Environmental extremists like the Sierra Club are
working every day to kill high-paying jobs through frivolous lawsuits and
burdensome regulations. It’s time to understand how Montana’s energy policy
affects you. Check out www.energyxxi.org.” (Doc. 100-7 at 2.) On the back, the
mailer further explained:
Billings is a prime location to feel the economic benefits of the
Bakken oil boom and development of the Otter Creek coal deposits.
1
In addition to the 2014 mailers, MCD also created four additional advertisements in
2013 that were provided to the Court, but never distributed. (See Doc. 100-6.) A review of the
2013 advertisements reveal that these mailers are similar to the 2014 mailers. However, three of
the four 2013 mailers fail to name a candidate for office. Because these three mailers fail to
name a candidate for office, the Court finds that they would not be an electioneering
communication under the plain language of the statute and regulation. See Mont. Code Ann. §
13–1–101(15)(a); Admin. R. Mont. 44.11.605(1)(e) (requiring an electioneering communication
to refer to a candidate or the candidate’s “name, image, likeness, or voice”). Because these
mailers are not electioneering communications under Montana law, any money spent in their
production would not be an expenditure. See Mont. Code Ann. § 13–1–101(17)(a)(ii) (defining
an “Expenditure” as “anything of value . . . used or intended for use . . . in producing
electioneering communications”). Thus, because a political committee is only formed if it
“makes an expenditure,” the distribution of these three 2013 mailers would not require MCD to
register as a political committee. See Mont. Code Ann. § 13–1–101(30)(a)(iii) (stating that a
“Political committee” is a “a combination of two or more individuals . . . who . . . make[] an
expenditure . . . to prepare or disseminate an . . . electioneering communication”). Thus, there is
no basis for a constitutional challenge related to the 2013 mailers that did not name a candidate.
Accordingly, the Court’s analysis for the present motion will be limited to the 2014
advertisements and the lone 2013 mailer that did name a candidate. The Court notes that the lone
2013 mailer, which names John Quant, is almost identical to the mailer that names Joshua
Sizemore. (Compare Doc. 100-6 at 3–4, with Doc. 100-7 at 2–3.)
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Fortunately, local industry leaders like Joshua Sizemore are
promoting pro-growth policies that will develop resources and create
jobs right here in Billings. Institute for 21st Century Energy’s 5 Point
Plan:
1. Maximize America’s own energy resources
2. Make new and clean energy technologies more affordable
3. Eliminate regulatory barriers derailing energy projects
4. Do not put America’s existing energy sources out of
business
5. Encourage free and fair trade of energy resources and
technologies globally
But they can’t do it alone. Learn more at www.energyxxi.org and
join the fight. Paid for by Montanans for Community Development
(Doc. 100-7 at 3 (omitted punctuation marks in original).)2
The second mailer, similar to the first, discussed how:
Over the past decade, modern horizontal drilling technology has
created an energy and jobs boom in Eastern Montana. In 2013,
Montana’s oil and gas industry contributed to over 15,600 jobs,
which pay over 2/3 more than the state average.3 Last year alone,
Montana added an additional 4,900 jobs involved in selling goods
and services to the oil and gas industry.”
(Doc. 100-7 at 4.) The back of the second mailer ominously continued:
However, environmentalists like Mary McNally are fighting this
progress at every turn. They’re proposing:
- Putting a stop to the development of Montana’s rich coal
2
The text of the mailer was accompanied by pictures. On the front, the face of a clock.
On the back, a dirt road leading to an oil and gas drilling rig and a photograph of a man,
presumably Joshua Sizemore.
3
The mailer provided a footnote citation to: “‘Articles & Reports - Montana Petroleum
Association.’ Articles & Reports - Montana Petroleum Association. N.p., n.d. Web. 12 Aug.
2014.1.” (Doc. 100-7 at 4 (punctuation in original.)
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reserves
- Shutting down modern natural resource development
practices that bring jobs to rural communities
- Locking up federal land in Eastern Montana so no resource
development can take place
- Blocked critical infrastructure projects that let Montana
export its coal, oil, and natural gas.
There is an alternative to this extremist rhetoric. Go to
www.energyxxi.org and support the Institute for 21st Century
Energy’s Plan to maximize America’s own energy resources.
(Doc. 100-7 at 5 (punctuation in original).)4
MCD asserts that it is an issue advocacy organization with a goal to educate
the public and does not support any political candidates or parties. Despite this
assertion, MCD sought to distribute these mailers during the sixty days preceding
the 2014 election, an election where both of the named individuals in the mailers
were running for office. Nonetheless, MCD steadfastly maintains that it will not
speak, i.e., distribute these mailers, if it has to comply with Montana’s political
committee disclosure and reporting requirements. Accordingly, MCD contends
that its speech has been chilled and filed this lawsuit challenging the
constitutionality of Montana’s political committee and disclosure laws.
4
Like the first mailer, the second mailer also contains images in addition to text. On the
front of the second mailer is a picture of horizontal oil pumpjack next to a person wearing a
cowboy hat. On the back is another image of a horizontal oil pumpjack next to a photograph of a
woman, presumably Mary McNally.
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B. Montana’s Committee and Disclosure Laws
Under Montana law, a “Political committee” is defined as:
a combination of two or more individuals or a person other than an
individual who receives a contribution or makes an expenditure:
(i) to support or oppose a candidate or a committee organized to
support or oppose a candidate or a petition for nomination;
(ii) to support or oppose a ballot issue or a committee organized to
support or oppose a ballot issue; or
(iii) to prepare or disseminate an election communication, an
electioneering communication, or an independent expenditure.
Mont. Code Ann. § 13–1–101(30). This definition recognizes four types of
political committees: (1) ballot issue committees; (2) incidental committees; (3)
independent committees; and (4) and political party committees. Id. The statute
clarifies that “[a] political committee is not formed when a combination of two or
more individuals or a person other than an individual makes an election
communication, an electioneering communication, or an independent expenditure
of $250 or less.” Id.
An “Incidental committee” is “a political committee that is not specifically
organized or operating for the primary purpose of supporting or opposing
candidates or ballot issues but that may incidentally become a political committee
by receiving a contribution or making an expenditure.” Mont. Code Ann.
§ 13–1–101(22)(a). Factors to consider in determining an organization’s primary
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purpose are “allocation of budget, staff, or members’ activity or the statement of
purpose or goal of the person or individuals that form the committee.” Mont.
Code Ann. § 13–1–101(22)(b).
Incidental committees, like all political committees, must periodically
submit reports concerning “contributions and expenditures made by or on the
behalf of a candidate or political committee.” Mont. Code Ann. § 13–37–225(1).
Failure to do so may result in civil and criminal prosecution, and penalties “for an
amount up to $500 or three times the amount of the unlawful contribution or
expenditure, whichever is greater.” Mont. Code Ann. § 13–37–228; Admin. R.
Mont. 44.11.240. Defendants assert that MCD would most likely be classified as
an incidental committee.
C. Commissioner of Political Practices
Under Montana law, “the [C]ommissioner is responsible for investigating
all of the alleged violations of the election laws . . . and in conjunction with the
county attorneys is responsible for enforcing these election laws.” Mont. Code.
Ann. § 13–37–111(1). Montana’s current Commissioner is Defendant Jonathan
Motl (“Motl”).
MCD vilifies Motl and accuses him of engaging in political profiling by
investigating and seeking litigation against “certain groups and individuals whose
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political ideology he disagrees with,” specifically, “dark money”5 groups and its
supporters. (Doc. 100 at 22.) MCD provides that Motl unlawfully targets these
individuals and groups, while simultaneously providing favorable treatment to
groups and individuals whose political ideologies he supports.6 Further, MCD
states that the Commissioner’s investigative practices expose individuals to false
accusations and potential damage to reputation. Specifically, MCD states that it
will not distribute its mailers out of fear that Motl will: (1) damage MCD’s
reputation; (2) issue substantial fines against MCD; (3) construe the mailers as
coordinated, in-kind contributions and investigate and/or remove the individuals
mentioned in the mailers from office; and (4) publish confidential information
about MCD on the Commissioner’s website. Accordingly, MCD challenges the
Commissioner’s investigatory powers as unconstitutional, contends that Motl
engages in unlawful viewpoint discrimination, and accuses him of violating the
5
Motl defines “dark money” as “money spent in Montana elections that is not reported or
disclosed by the candidate or by the third party entity spending the money.” (Doc. 122 at 2.)
This definition largely corresponds with other attempts to define this term. See Danny Emmer,
Shedding Light on “Dark Money”: The Heightened Risk of Foreign Influence Post-Citizens
United, 20 Sw. J. Int'l L. 381, 394 (2014) (describing “dark money” as money provided by
“people who want to influence elections without identifying themselves”).
6
Specifically, MCD accuses Motl of using his investigatory powers to support Democrats
and so-called “Responsible Republicans,” i.e., Republican politicians who support the regulation
of dark money, while simultaneously abusing his powers to investigate and prosecute politicians
and their supporters that do not.
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Equal Protection Clause.
D. Procedural History
MCD filed its initial complaint on September 3, 2014, seeking declaratory
and injunctive relief. This complaint numbered 46 pages and alleged 14 counts.
MCD also moved for a preliminary injunction seeking to enjoin the
Commissioner, as well as Defendants Montana Attorney General Timothy Fox and
Lewis and Clark County Attorney Leo Gallagher (collectively “Defendants”),
from enforcing Montana’s election and disclosure laws on the eve of the 2014
general election. On October 22, 2014, the Court denied the motion after finding
that none of the factors discussed in Winter v. Natural Resources Defense Council,
Inc., 555 U.S. 7, 20 (2008), supported an order preliminarily enjoining these laws.
(Doc. 28.)
Following the denial, MCD filed an interlocutory appeal to the United
States Court of Appeals for the Ninth Circuit and moved for an emergency
injunction pending appeal. The Ninth Circuit denied the motion for an emergency
injunction and MCD subsequently moved to voluntarily dismiss the appeal.
In June of 2015, MCD filed its first amended complaint. The amended
complaint spanned 62 pages and alleged 15 counts. A few months later,
Defendants moved the Court to compel MCD to respond to certain interrogatories
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and requests for production put forth during discovery. The Court granted
Defendants’ motion in part and denied it in part after finding that some of the
discovery requests were relevant and others were not. Ultimately, the Court found
that the requests for information concerning MCD’s communications with outside
groups were relevant while internal communications within MCD were not. MCD
then filed an interlocutory appeal with the Ninth Circuit requesting a writ of
mandamus. The Ninth Circuit denied this request after concluding that MCD had
not established grounds warranting the Ninth Circuit’s intervention.
Following this appeal, the Court issued a new scheduling order setting a
bench trial for early May 2016. Shortly thereafter, on December 31, 2015, MCD
filed its second amended complaint. This document expanded to 93 pages and
brought several new causes of action, resulting in a total of 23 counts. In addition
to several new counts challenging recently adopted political committee and
disclosure regulations, MCD added the above-described claims alleging viewpoint
discrimination and equal protection violations against Motl.
The parties filed cross-motions for summary judgment and the Court
conducted a hearing on the motions. Shortly before the hearing, MCD moved to
vacate the scheduled bench trial stating that it “strongly believes that this matter
can be resolved based on the pending summary judgment motions.” (Doc. 161 at
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2.) Based upon this representation, and because Defendants did not oppose the
motion, the Court vacated the bench trial. (Doc. 162.)
As discussed, MCD asserts an unwavering unwillingness to comply with
Montana’s political committee reporting requirements and disclosure laws. MCD
provides that it desired to distribute mailers during the sixty days preceding the
2014 general election that would have informed the public about “policies that
create jobs and grow local economies throughout Montana,” but did not do so
because it would have been required to register as political committee. (Doc. 100
at 17–19.) MCD asserts that though these mailers would have contained the
names of individuals who were candidates in the 2014 election and provided
information that was arguably critical or supportive of the candidates, the intention
of these mailers would have been to educate the general public, not to advocate for
the election or defeat of the candidates.
Because MCD will not distribute its mailers if it is subject to Montana’s
political committee and disclosure requirements, it contends that its First
Amendment right of free speech has been unconstitutionally chilled. As such,
MCD challenges the constitutionality of Montana’s political committee and
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disclosure laws and and moves for summary judgment on its claims.7
ANALYSIS
A party is entitled to summary judgment if it can demonstrate that “there is
no genuine dispute as to any material fact and the movant is entitled to judgment
as a matter of law.” Fed. R. Civ. P. 56(a). Summary judgment is warranted where
the documentary evidence produced by the parties permits only one conclusion.
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 251 (1986). A party opposing a
properly supported motion for summary judgment “may not rest upon mere
allegation or denials of his pleading, but must set forth specific facts showing that
there is a genuine issue for trial.” Id. at 256. Only disputes over facts that might
affect the outcome of the lawsuit will preclude entry of summary judgment; factual
disputes that are irrelevant or unnecessary to the outcome are not considered. Id.
at 248.
I. Preliminary Challenges to Standing
Defendants first dispute MCD’s constitutional standing to challenge
7
MCD has also provided notice of two cases recently decided in the District of Montana.
(See Doc. 168.) Defendants move to strike this supplemental authority because it lodges new
arguments and fails to follow this District Local Rules. See D. Mont. L.R. 7.4 (stating that a
notice of supplemental authority “may not exceed two pages and must not present a new
argument”). The Court will thus grant Defendants’ motion because the notice of supplemental
authority presents new arguments and exceeds the two-page limit. However, the Court will take
judicial notice of these cases.
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Montana’s statutes and regulations.
A. Administrative Rules Effective January 9, 2016
As stated above, MCD’s filed its second amended complaint on December
31, 2016. The second amended complaint raised several challenges to
administrative regulations that did not become effective until January 9, 2016.
MCD asserts that it has standing to challenge these regulations because although
they were not effective until after the second amended complaint was filed, they
were adopted November 24, 2015, more than a month before the filing. Further,
MCD contends that Motl testified on November 17, 2015, before the State
Administration and Veterans’ Affairs Committee, that the adoption date for the
regulations was the date the regulations became the policy of the Commissioner.
As such, MCD contends that these adopted regulations, though not yet effective,
had the force of law.8 Because they have the force of law, MCD argues, it has
standing to challenge the administrative regulations that became effective after it
filed its second amended complaint.
Article III of the United States Constitution mandates that courts must only
8
At the hearing on the cross-motions for summary judgment, counsel for MCD stated
that many courts have looked to the date when the statutes or regulations were adopted for
standing purposes, not the date when the law became effective. Counsel for MCD, however,
fails to provide the Court with any case names or citations for this authority.
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“adjudicate live cases or controversies” and should refrain from issuing advisory
opinions. Thomas v. Anchorage Equal Rights Commn., 220 F.3d 1134, 1138 (9th
Cir. 2000) (en banc) (citing to U.S. Const. art. III). As such, courts have the
responsibility to ensure that litigants have standing under Article III to bring their
claims. DaimlerChrysler Corp. v. Cuno, 547 U.S. 332, 340 (2006). Further, a
“plaintiff must demonstrate standing for each claim he or she seeks to press and
for each form of relief sought.” Washington Envtl. Council v. Bellon, 732 F.3d
1131, 1139 (9th Cir. 2013) (citing DaimlerChrysler Corp., 547 U.S. at 352). The
existence of standing is determined by “the facts as they exist when the complaint
is filed.” Lujan v. Defenders of Wildlife, 504 U.S. 555, 569 n. 4 (1992) (citation
omitted).
In Yamada v. Snipes, the Ninth Circuit found that a corporation lacked
standing to challenge a Hawaii statute because the statue was amended, i.e., it
became effective, after the corporation filed its complaint. 786 F.3d 1182, 1204
(9th Cir. 2015) (see also Haw. Rev. Stat. Ann. § 11-341 (clarifying that the date
the statute became effective was the same day the amendment occurred)). Here,
the Court applies the same approach as the Yamada Court and finds that MCD
lacks standing to challenge the regulations that came into effect after MCD filed
its second amended complaint.
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However, instead of dismissing these regulatory challenges outright, the
Court could allow MCD leave to file another amended complaint. See Fed. R.
Civ. P. 15(a)(2) (stating that a party may amend its complaint with leave of court,
and leave of court should be freely given when justice requires); see also Theme
Promotions, Inc. v. News America Marketing FSI, 546 F.3d 991, 1010 (9th Cir.
2008) (“We apply [Rule 15’s] policy liberally.”). However, the Court is loath to
invite the filing of a third amended complaint. This case has stretched on for a
considerable time and the Court does not want to further delay its resolution.
Many of the challenged campaign committee disclosure and reporting statutes,
which rely on the regulations to determine their meaning and application, are
unaffected by Defendants’ challenge to these same regulations. As discussed
below, because the Court denies MCD’s challenges to the statutory counterparts to
these regulations, the Court will address the regulations on the merits.
B. Investigatory Process
Defendants next assert that MCD lacks standing to challenge the
Commissioner’s investigative powers as described in Count 21 (misidentified as
Count XX) of the second amended complaint. As stated above, the Commissioner
is responsible for investigating alleged violations of Montana’s election laws.
Mont. Code. Ann. § 13-37-111(1). In the exercise of his duties, MCD states that
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the Commissioner “routinely post complaints, notices of complaints (often with
supporting documentation), as well as sufficiency findings disclosing associations
and strategies on the Commission’s website.” (Doc. 100 at 78.)
MCD goes on to state that the Commissioner has, in the past, publically
posted confidential materials accumulated through the complaint and investigatory
process. MCD provides that it will refrain from distributing mailers because if
they do, “any complaint filed against it will be publicly posted and could subject it
to damaging publicity.” (Id. at 81.) Further, “any confidential associations or
strategies [MCD] provides or are discovered during an investigation can become
public knowledge. ” (Id.) As such, MCD argues that the Commissioner’s
investigation powers chill its speech in violation of the First and Fourteenth
Amendments.
As mentioned above, a party must satisfy standing requirements for each
claim alleged. Washington Envtl. Council, 732 F.3d at 1139. MCD, as the party
bringing this suit, bears the initial burden of establishing standing by showing “(1)
an injury in fact, (2) a sufficient causal connection between the injury and the
conduct complained of, and (3) a likelihood that the injury will be redressed by a
favorable decision.” Susan B. Anthony List v. Driehaus, 134 S. Ct. 2334, 2341
(2014) (citation and internal quote marks omitted). Importantly, to satisfy Article
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III standing requirements, the injury in fact “must be concrete and particularized
and actual or imminent, not conjectural or hypothetical.” Id. (citation and internal
quote marks omitted).
In pre-enforcement cases, or cases where a party is arguably subject to
threat of prosecution or other government action, “it is not necessary that
petitioner first expose himself to actual arrest or prosecution to be entitled to
challenge a statute that he claims deters the exercise of his constitutional rights.”
Id. at 2342 (quoting Steffel v. Thompson, 415 U.S. 452, 459 (1974). Instead, an
injury in fact can be established by “demonstrating a realistic danger of sustaining
a direct injury as a result of the statute’s operation or enforcement.” Lopez v.
Candaele, 630 F.3d 775, 785 (9th Cir. 2010) (quoting Babbitt v. United Farm
Workers Nat’l Union, 442 U.S. 289, 298 (1979)). To demonstrate this danger, a
party must allege: (1) an intention to engage in conduct arguably influenced by a
constitutional interest, but prohibited by statute; and (2) a credible threat of
prosecution. Id. Typically, plaintiffs can establish a credible threat by: (1)
showing “a reasonable likelihood that the government will enforce the challenged
law against them”; (2) “establish[ing], with some degree of concrete detail, that
they intend to violate the challenged law”; and (3) showing that the law is
applicable to plaintiffs. Id. at 786.
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Here, the Court finds that MCD lacks standing under Count 21 for two
independent reasons. First, MCD’s intended course of conduct is not prohibited
by the statute it challenges. Second, MCD fails to show that enforcement of the
Commissioner’s powers would cause actual and imminent injury.
Importantly, MCD states that it will not comply with Montana’s political
committee reporting and disclosure requirements. This conduct would violate
Montana’s statutes that require reporting and disclosure. In Count 21, MCD is
challenging the Commissioner’s investigation procedures, specifically the power
to investigate under Montana Code Annotated (“MCA”) § 13-37-111(1). Here,
although the organization has “alleged an intention to engage in a course of
conduct arguably affected with a constitutional interest” by distributing its mailers,
this conduct is not “arguably . . . proscribed by [the] statute” MCD challenges.
Babbitt, 442 U.S. at 298. Put another way, distributing mailers does not violate
MCA § 13-37-111(1).
However, even if MCD’s intended speech would not have violated MCA
§ 13-37-111(1), the exercise of this statute could, arguably, “deter[] the exercise of
[MCD’s] constitutional rights.” Susan B. Anthony List, 134 S. Ct. at 2342.
Nonetheless, in order for MCD to satisfy its burden for standing, it must show that
enforcement of this provision would lead to imminent injury. MCD fails to make
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this showing.
For one, if MCD had distributed these mailers and declined to report it, a
complaint would first have to be filed with the Commissioner. The Court, as
discussed below, finds this scenario to be possible. However, a complaint being
filed against MCD is not a cognizable injury. Indeed, the specific harm MCD
alleges is harm to its reputation as a result of the complaint. The Court finds that
possible damage to one’s reputation is too speculative to support an injury in fact.
See Nampa Classical Acad. v. Goesling, 2009 WL 2923069, at *3 (D. Idaho Sept.
10, 2009) (Plaintiffs’ claim of damage to reputation did not constitute injury for
standing purposes). Similarly, the possibility that the Commissioner would
publish MCD’s confidential “associations or strategies” (Doc. 100 at 81) is also
too conjectural to support Article III standing. MCD therefore lacks standing to
challenge the Commissioner’s investigatory powers and summary judgment is
granted to Defendants on Count 21 (mis-numbered as Count XX).
C. Discrimination and Equal Protection Challenges
As discussed, MCD also claims that Motl engages in viewpoint
discrimination against dark money groups. As a result, MCD alleges, Motl treats
similarly situated persons and groups differently based upon their perceived
support or opposition to dark money. (Doc. 100 at 84–86 (citing various alleged
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examples of Motl’s unconstitutional viewpoint discrimination).) MCD thus
contends that Motl has violated the Equal Protection rights of these groups.
Notwithstanding these arguments, the Court declines to reach address these issues
as it finds that MCD lacks standing to bring Counts 22 and 23 (mis-identified as
Counts XXI and XXII).
Like MCD’s previous counts, the organization must “satisfy standing
requirements for each claim alleged.” Washington Envtl. Council, 732 F.3d at
1139. In terms of standing, it is well settled that a party “cannot rest [its] claim to
relief on the legal rights or interests of third parties.” Voigt v. Savell, 70 F.3d
1552, 1564 (9th Cir. 1995). Indeed, the injury relied upon for standing purposes
must be “direct and personal to the particular plaintiff.” Catholic League for
Relig. and Civ. Rights v. City and County of San Francisco, 624 F.3d 1043, 1066
(9th Cir. 2010); see also Lujan, 504 U.S. at 561 n. 1 (“[T]he injury must affect the
plaintiff in a personal and individual way.”).
Here, however, the discriminatory harms allegedly perpetrated by Motl,
Plaintiff concedes (see Doc. 100 at 83–86), have been against groups other than
MCD.9 MCD fails to allege any personal and direct injury to the organization
9
The Court notes that MCD does claim that Motl refused to issue advisory opinions
requested by the organization while issuing opinions for groups he supports (Doc. 100 at 83
(citing Docs. 100-21, 100-22, 100-23, 100-24).) The Court has reviewed these documents and
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caused by Motl’s past actions. If Motl has indeed discriminated against these
groups, let them come forward. MCD simply is not the proper plaintiff to allege
these claims. The Court grants summary judgment to Defendants on Counts 22
and 23.10
D. Count XVII
Defendants next contest MCD’s standing to bring Count XVII. This Count
challenges Administrative Rule of Montana (“ARM”) 44.11.504.11 Defendants
contend that MCD has not alleged facts which would result in a violation of this
regulation. In its response brief to Defendants’ motion for summary judgment,
finds MCD’s claim that they are evidence of Motl’s discrimination completely without merit.
10
Arguably, however, Counts 22 and 23 of MCD’s second amended complaint could be
read to support an argument that Motl’s alleged discriminatory actions also chilled MCD’s
speech because it did not distribute its mailers out of fear that Motl would punish the group for
its views on dark money. However, the Court finds this possible injury to be too speculative to
support a claim for standing. For one, if Motl did pursue complaints against dark money groups,
MCD could not prove that this pursuance was due to an improper motive. Moss v. U.S. Secret
Serv., 572 F.3d 962, 970 (9th Cir. 2009) (to establish a viewpoint discrimination claim, plaintiff
must show that the government official’s alleged discriminatory action was “because of not
merely in spite of” plaintiff’s message). Second, according to MCD, its message is directed
towards “promot[ing] and encourag[ing] policies that create jobs and grow local economies
throughout Montana.” (Doc. 100 at 17.) MCD’s stated viewpoint thus has nothing to do with
promoting dark money.
11
This regulation provides that “[i]f a candidate or political committee, or member
thereof, advises, counsels, or otherwise knowingly encourages any person to make an
expenditure for the purpose of avoiding direct contributions, or for any other reason, the
expenditure shall be considered a contribution by that person to the candidate or political
committee encouraging the expenditure.” Admin. R. Mont. 44.11.504.
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MCD concedes that it “did not allege facts in its complaint establishing a
harm arising from that regulation” and “withdraws its challenge to ARM 44.11.
504.” (Doc. 157 at 12.) The Court thus grants summary judgment to Defendants
on Count XVII.
II. Challenges to Political Committee and Disclosure Laws
Before the Court addresses MCD’s challenges to Montana’s political
committee and reporting laws, the Court must first address MCD’s standing to
bring these claims.
A. Standing
As previously mentioned, standing for pre-enforcement litigants can be
established by alleging an injury in fact. Lopez, 630 F.3d at 785. MCD can
establish an injury in fact by “demonstrating a realistic danger of sustaining a
direct injury as a result of the [challenged] statute’s operation or enforcement.” Id.
To demonstrate a realistic danger, MCD must allege an intention to engage in
conduct arguably impacted by a constitutional interest, but prohibited by statute,
and a credible threat of prosecution. Id.
Here, MCD has alleged an intention to engage in First Amendment related
conduct. In its second amended complaint, the organization states an intention to
engage in speech through the distribution of issue advocacy mailers. MCD has
-22-
provided copies of these mailers and the Court readily concludes that these mailers
constitute protected speech under the First Amendment.
Next, to establish standing, MCD must show that its intended speech is
prohibited under Montana law and the organization faces a credible threat of
prosecution as a result of its speech. Id. As described above, in order to satisfy its
burden, MCD must show: (1) a reasonable likelihood that the challenged laws will
be enforced against it; and (2) allegations “with some degree of concrete detail,
that [it] intend[s] to violate the challenged law.” Id. at 786.
In analyzing the first factor, courts must determine if there is a credible
threat of enforcement. Id. This can include specific warnings or threats to initiate
proceedings under the challenged regulations, or a history of past enforcement
under the challenged regulations against similarly situated parties. Id. Applying
the second factor, MCD’s intent to violate the law must be demonstrated by a
concrete plan detailing its future speech. Id. Demonstrated plans to distribute
flyers regarding a specific ballot initiative or mail postcards criticizing a
candidate’s position on an issue have been sufficient to satisfy the intent to violate
factor. Am. Civ. Liberties Union of Nev. v. Heller, 378 F3d 979, 984 (9th Cir.
2004).
Here, the Court finds that MCD has satisfied both prongs and has standing
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to challenge Montana’s campaign committee reporting and disclosure laws. First,
it is well documented that the Commissioner has enforced Montana’s disclosure
and reporting requirements against similarly situated parties in the past. (Doc. 28
at 8 (describing the fines imposed by the Commissioner against the political
committee American Tradition Partnership for failing to report expenses).) MCD
satisfies the first prong.
Next, to qualify as an incidental political committee, an organization need
only spend $250 on electioneering communications distributed 60 days before an
election. Mont. Code Ann. §§ 13–1–101(15)(a), 17(a)(ii), 22(a), (30)(a)(iii). As
mentioned above, failure to adhere to Montana’s committee reporting
requirements subjects an organization to civil and criminal prosecution,12
including monetary fines. Mont. Code Ann. § 13–37–228.
In this case, MCD has established that it intended to spend over $250 on
mailers in September of 2014. MCD also states that it would like to send similar
mailers in the future. At the hearing on the underlying motions and in its briefing,
Defendants asserted that MCD would most likely be classified as an incidental
committee. Finally, the parties agree that the individuals named in the September
12
The Court highly doubts that failure to report an electioneering communication would
have subjected MCD to criminal prosecution. Indeed, at most, MCD would have been issued a
civil fine.
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2014 mailers were candidates in the upcoming November election.13
Under these facts, the Court concludes that MCD’s 2014 mailers, at a
minimum, would have been considered electioneering communications if
distributed before the 2014 election. This distribution would have required MCD
to register as a political committee. Failure to do so would most likely have
subjected MCD to civil penalties. As discussed, the Commissioner has a history
of past enforcement of these laws. Accordingly, the Court concludes that MCD
has standing to bring its vagueness challenges to Montana’s political committee
and disclosures laws.
B. Vagueness Challenges on the Merits
MCD first challenges several of Montana’s disclosure and reporting laws as
facially unconstitutional. A facial challenge, in contrast to an as-applied
challenge, argues a law is unconstitutional on its face. A law “may be facially
unconstitutional in one of two ways: either it is unconstitutional in every
conceivable application, or it seeks to prohibit such a broad range of protected
conduct that it is unconstitutionally overbroad.”14 Foti v. City of Menlo Park, 146
13
The Court presumes that any future mailers would also contain images and names of
current political candidates.
14
MCD’s overbreadth arguments are addressed supra.
-25-
F.3d 629, 635 (9th Cir. 1998) (punctuation marks omitted) (quoting Members of
City Council of City of Los Angeles v. Taxpayers for Vincent, 466 U.S. 789, 796
(1984)). Under a vagueness challenge, the first type of facial challenge, “the
plaintiff argues that the ordinance could never be applied in a valid manner
because it is unconstitutionally vague or it impermissibly restricts a protected
activity.” Foti,146 F.3d at 635 (citing N.A.A.C.P. v. City of Richmond, 743 F.2d
1346, 1352 (9th Cir. 1984).
“A law is unconstitutionally vague if it fails to provide a reasonable
opportunity to know what conduct is prohibited, or is so indefinite as to allow
arbitrary and discriminatory enforcement.” Tucson Woman’s Clinic v. Eden, 379
F.3d 531, 555 (9th Cir. 2004) (citations omitted). However, “perfect clarity is not
required even when a law regulates protected speech.” Cal. Teachers Ass'n v. State
Bd. of Educ., 271 F.3d 1141, 1150 (9th Cir. 2001); see also Grayned v. City of
Rockford, 408 U.S. 104, 110 (1972) (“Condemned to the use of words, we can
never expect mathematical certainty from our language.”). Consequently, “even
when a law implicates First Amendment rights, the constitution must tolerate a
certain amount of vagueness.” California Teachers Ass'n, 271 F.3d at 1151.
Additionally, a law is impermissibly vague if its “deterrent effect on
legitimate expression is . . . both real and substantial.” Young v. American Mini
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Theatres, Inc., 427 U.S. 50, 60 (1976) (quotation marks omitted) “Whether a
statute’s chilling effect on legitimate speech is substantial should be judged in
relation to what the statute clearly proscribes.” California Teachers Ass'n, 271
F.3d at 1151. However, “uncertainty at a statute’s margins will not warrant facial
invalidation if it is clear what the statute proscribes ‘in the vast majority of its
intended applications.”’ Id. (quoting Hill v. Colorado, 530 U.S. 703, 733 (2000)
(quotation marks omitted)). Further, the Court “must accept a narrowing
construction to uphold the constitutionality of an ordinance if its language is
‘readily susceptible’ to it.” Nunez by Nunez v. City of San Diego, 114 F.3d 935,
942 (9th Cir. 1997) (quoting Virginia v. American Booksellers Ass’n, 484 U.S.
383, 397 (1988)).
Lastly, when construing state statutes and regulations, this Court must
follow Montana’s rules of statutory interpretation. Assn. des Eleveurs de Canards
et d’Oies du Quebec v. Harris, 729 F.3d 937, 945 (9th Cir. 2013) (“In interpreting
a state statute, we apply the state’s rules of statutory construction.”). In Montana,
“the rules of statutory construction require the language of a statute to be
construed according to its plain meaning.” Clarke v. Massey, 897 P.2d 1085, 1088
(Mont. 1995).
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1. Challenges to Statutory Definitions
MCD initially argues that the statutory definitions of contribution,
expenditure, and political committee are unconstitutionally vague. MCD relies on
two arguments for this contention. First, MCD asserts that the definitions of these
terms are vague because they rely on one another for their meaning. Because their
definitions are circular, MCD reasons, the Court must strike them down as vague.
Second, MCD contends that the above terms are vague because they rely on the
phrase “support or oppose.” (Doc. 129 at 12.) This phrase, MCD suggests, has
been interpreted by courts to be the functional equivalent of the “appeal-to-vote
test,” which, according to MCD, the United States Supreme Court views
unfavorably. (Id. (citing Fed. Election Comm’n v. Wisconsin Right to Life, Inc.,
551 U.S. 449 (2007).) The Court will address each of these argument in turn.
i. Circular Definitions
As discussed, MCD suggests that the statutory definitions of contribution,
expenditure, and political committee are unconstitutionally vague because they are
based on circular definitions. Under Montana law, a “Contribution” is defined as:
(i) the receipt by a candidate or a political committee of an advance,
gift, loan, conveyance, deposit, payment, or distribution of money or
anything of value to support or oppose a candidate or a ballot issue;
(ii) an expenditure, including an in-kind expenditure, that is made in
coordination with a candidate or ballot issue committee and is
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reportable by the candidate or ballot issue committee as a
contribution;
(iii) the receipt by a political committee of funds transferred from
another political committee; or
(iv) the payment by a person other than a candidate or political
committee of compensation for the personal services of another
person that are rendered to a candidate or political committee.
Mont. Code. Ann. § 13–1–101(9)(a). Further, an “Expenditure” is defined as:
a purchase, payment, distribution, loan, advance, promise, pledge, or
gift of money or anything of value:
(i) made by a candidate or political committee to support or oppose a
candidate or a ballot issue; or
(ii) used or intended for use in making independent expenditures or in
producing electioneering communications.15
Mont. Code Ann. § 13–1–101(17)(b). Lastly, as discussed above, a “Political
committee” is:
a combination of two or more individuals or a person other than an
individual who receives a contribution or makes an expenditure:
(i) to support or oppose a candidate or a committee organized to
support or oppose a candidate or a petition for nomination;
(ii) to support or oppose a ballot issue or a committee organized to
support or oppose a ballot issue; or
(iii) to prepare or disseminate an election communication, an
electioneering communication, or an independent expenditure.
15
This statute further claries that an ‘“Expenditure’ does not mean: (i) services, food, or
lodging provided in a manner that they are not contributions under subsection (9); (ii) payments
by a candidate for a filing fee or for personal travel expenses, food, clothing, lodging, or personal
necessities for the candidate and the candidate’s family; (iii) the cost of any bona fide news story,
commentary, blog, or editorial distributed through the facilities of any broadcasting station,
newspaper, magazine, or other periodical publication of general circulation; or (iv) the cost of
any communication by any membership organization or corporation to its members or
stockholders or employees.” Mont. Code Ann. § 13–1–101(17)(b).
-29-
Mont. Code Ann. § 13–1–101(30)(a).
MCD suggests that because the scope of contribution and expenditure are
defined by political committee, and political committee relies on contribution and
expenditure for its definition, these terms are circular and must be facially struck
down. The Court disagrees.
Reading these terms in their context, the Court finds that their reliance on
one another does not make them vague. Instead, this reliance facilitates clarity as
to which groups are covered by Montana’s campaign finance laws, i.e., candidates
and political committees. Applying these terms as a whole, it is clear that a
political committee is a “combination of two or more individuals or a person other
than an individual,” that either (1) receives “an advance, gift, loan, conveyance,
deposit, payment, or distribution of money or anything of value to support or
oppose a candidate or a ballot issue” (i.e., a “contribution”); or (2) makes a
“purchase, payment, distribution, loan, advance, promise, pledge, or gift of money
or anything of value” (i.e, an “expenditure”) to support or oppose a candidate or
ballot issue. See Mont. Code Ann. §§ 13–1–101(3), (9), (17). Thus, the Court
finds that these terms are not so vague that they fail “to provide a reasonable
opportunity to know what conduct is prohibited.” Tucson Woman’s Clinic, 379
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F.3d at 555. The Court thus rejects MCD’s first vagueness argument.
ii. Appeal to Vote Language
Next, MCD contends that because the statutory definitions of contribution,
expenditure, political committee, and electioneering communication contain the
terms “support or oppose,” they are unconstitutionally vague. MCD maintains that
these terms are express advocacy or its functional equivalent—the appeal to vote
test. According to MCD, the appeal to vote test is vague under Federal Election
Commission v. Wisconsin Right to Life, Inc., 551 U.S. 449 (2007) (“WRTL II”).
Again, the Court disagrees and finds that these terms are not vague.
In Yamada v. Snipes, a Ninth Circuit decision cited above, the Court
examined a vagueness challenge to the term “influencing” under Hawaii’s
campaign finance laws and rejected the challenge. Yamada, 786 F.3d at
1188–1191. There, the Court found that the term was not vague because it was
significantly narrowed by the state’s interpretation of the statute. Id. at 1188–1189
(stating that the state’s interpretation of “influence” did not create vagueness
problems because the interpretation of the term “refers only to communications or
activities that constitute express advocacy or its functional equivalent”). Further,
the Ninth Circuit rejected the argument, similar to MCD’s, that terms that regulate
express advocacy or appeal to vote language are per se vague. See Id. at 1191
-31-
(“We therefore join the First, Fourth and Tenth Circuits in holding that the ‘appeal
to vote’ language is not unconstitutionally vague.”).
Here, like the law at issue in Yamada, the definition of “support or oppose”
has been given a significantly narrowed definition which disarms, it not negates,
any vagueness arguments applied to it. Indeed, the terms “support or oppose,” are
defined under Montana law to mean:
(a) using express words, including but not limited to “vote”,
“oppose”, “support”, “elect”, “defeat”, or “reject”, that call for the
nomination, election, or defeat of one or more clearly identified
candidates, the election or defeat of one or more political parties, or
the passage or defeat of one or more ballot issues submitted to voters
in an election; or
(b) otherwise referring to or depicting one or more clearly identified
candidates, political parties, or ballot issues in a manner that is
susceptible of no reasonable interpretation other than as a call for the
nomination, election, or defeat of the candidate in an election, the
election or defeat of the political party, or the passage or defeat of the
ballot issue or other question submitted to the voters in an election.
Mont. Code Ann. § 13–1–101(49). The Court finds that this narrowing definition,
and in particular subsection (b), eliminates any vagueness arguments put forward
by MCD because it seeks only to regulate express advocacy. See WRTL II, 551
U.S. 449, 469–470 (2007) (“[A] court should find that an ad is the functional
equivalent of express advocacy only if the ad is susceptible of no reasonable
interpretation other than as an appeal to vote for or against a specific candidate.”).
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Because limited regulation of materials that constitute express advocacy is
permissible under the Constitution, see id. at 465, the Court finds that MCD’s
second statutory vagueness argument is without merit.16
2. Challenges to Regulatory Definitions
MCD next challenges the regulatory definitions of contribution,
expenditure, reportable election activity, and coordinated expenditure. The Court
first notes that many of MCD’s arguments rely on terms that were included in the
draft versions of these rules, but not included in the rules that became effective on
January 9, 2016. See Admin. R. Mont. 44.11.401(1), 44.11.501(1) (lacking the
phrase “not limited to” in the definitions of “expenditure” and “contribution”);
44.11.603 (lacking the phrase “on a case-by-case basis” and “other factors and
circumstances the commissioner determines are relevant” in the definition “de
minimis act” which serves to define “political committee”). To the extent that
MCD’s arguments rely on these non-adopted terms, the Court rejects these
arguments as moot.
16
The Court notes that MCD cites previous applications of these statutes by Motl in
various Commissioner cases as evidence that they are vague. Contrary to MCD’s argument,
under a vagueness challenge a plaintiff “cannot complain of the vagueness of the law as applied
to the conduct of others.” Hunt v. City of Los Angeles, 638 F.3d 703, 709–710 (9th Cir. 2011)
(quoting Holder v. Humanitarian L. Project, 561 U.S. 1, 18–19 (2010). Thus, a vagueness
challenge which asks the Court to consider application of the law to others is not appropriate.
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i. Political Committee Reporting Requirements
MCD first challenges the regulations constituting Montana’s political
committee reporting requirements under ARM 44.11.202(6) and 44.11.202(7), and
the rule governing the filing of statements and reports under ARM 44.11.302.
MCD contends that these statutes are vague because they contain or rely on terms
that are defined by the words “may,” “appeal,” and “not limited to” in the
definition of “reportable election activity.” These terms, MCD stresses, invite
mischief by the Commissioner in that they allow for arbitrary and discriminatory
enforcement.
Examining these terms as a whole, the Court finds that MCD’s arguments
attempt to read vagueness into the rules where none existed before. First, the
regulations define an incidental committee as:
a political committee that does not have the primary purpose of
supporting or opposing candidates or ballot issues. Incidental
committee reportable election activity17 may consist of:
(a) making one or more expenditures;
(b) accepting one or more designated contributions; or
(c) accepting one or more contributions in response to an appeal.
17
The rules define “Reportable Election Activity” as “includ[ing,] but is not limited to
accepting a contribution, a contribution in response to an appeal, or a designated contribution, or
making an expenditure, a contribution, a coordinated expenditure, an independent expenditure, or
an in-kind contribution or expenditure, or making an election communication or electioneering
communication.” Admin. R. Mont. 44.11.103(31) (emphasis added).
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Admin. R. Mont. 44.11.202(6) (emphasis added). Similarly, an independent
committee is defined as:
a political committee that has the primary purpose of supporting or
opposing candidates or ballot issues but is neither a ballot issue nor a
political party political committee. Independent committee
reportable election activity may consist of:
(a) making one or more expenditures;
(b) accepting one or more contributions.
Admin. R. Mont. 44.11.202(7) (emphasis added). Lastly, the rules stipulate that
reports concerning election activities must be filed electronically, however, “the
commissioner may provide a waiver.” Admin. R. Mont. 44.11.302.
Here, the use of the word may does not permit the possible mischief alleged
by MCD. Instead, it is clear that the use of may tells the Commissioner that any
activities following the term would constitute a reportable election activity. See
Admin. R. Mont. 44.11.202(6) (“Incidental committee reportable election activity
may consist of”); Admin. R. Mont. 44.11.202(7) (“Independent committee
reportable election activity may consist of”). The Court finds that use of this term
is not vague under the plain language of the regulation. Instead, the term is clearly
limited by the factors following it.18
18
For this reason, MCD’s argument that the phrase “primary purpose” is vague must also
fail. MCD argues that this phrase gives the Commissioner too much discretion and allows for
arbitrary enforcement. The Court disagrees and finds that the factors following this phrase limit
the Commissioner’s discretion. See Admin. R. Mont. 44.11.202(6), (7); see also 44.11.203
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Likewise, may under ARM 44.11.302 is permissible because it gives the
Commissioner discretion to allow candidates and committees to opt-out of
electronic reporting. This provision is clearly intended to allow an alternative for
mandatory electronic election reporting due to the possibility that the reporter may
not have access to the internet. The Court finds this discretion appropriate and not
likely to lead to abuse.
Next, the use of the word appeal in ARM 44.11.202(6) does not make the
regulation vague. Defendants provide a limiting interpretation of appeal to mean
“request.” (Doc. 120 at 29 (citing The American Heritage Dictionary 85 (5th ed.,
Houghton Mifflin Harcourt 2011) (defining appeal as “[a]n earnest or urgent
request”).) This limiting interpretation provides clarity to the rule and does not
lead to impermissible vagueness.
Lastly, the Court agrees with Defendants that MCD is in no danger of
arbitrary or discriminatory enforcement due to the phrase not limited to in the
definition of “reportable election activity.” Admin. R. Mont. 44.11.103(31). As
discussed, Defendants state that MCD’s 2014 mailers would most likely qualify as
“electioneering communications,” which is a reportable election activity.
Regardless, even if this was not the case, “uncertainty at a statute’s margins will
(defining primary purpose and limiting the definition based on identified factors).
-36-
not warrant facial invalidation if it is clear what the statute proscribes in the vast
majority of its intended applications.” California Teachers Ass’n, 271 F.3d at
1151 (quotation marks omitted). Here, the regulation describes numerous
examples of activities that constitute reportable election activities following the
phrase not limited to. See Admin. R. Mont. 44.11.103(31). Applicability of the
law is thus clear in the majority of situations.
ii. Derivative Challenges
Similar to its challenges aimed at the statutory definitions of “political
committee,” “expenditure,” and “contribution,” MCD also challenges the
regulatory definition of “political committee,” which relies on the statutory
definitions of these terms for its meaning. See Admin. R. Mont. 44.11.202(1), (3);
44.11.401(1); 44.11.501(1) (citing to Mont. Code Ann. § 13–1–101). MCD
contends that because these regulatory definitions cite to statutory definitions that
are vague, the regulations are also vague. The Court disagrees and finds that these
regulatory definitions are not vague for the reasons decided in section II.B.1 of
this Order.
3. Vagueness Challenge to “Electioneering Communication”
MCD’s final vagueness challenge is aimed at the statutory and regulatory
definitions of “electioneering communication.” This term is defined to mean:
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a paid communication that is publicly distributed by radio, television,
cable, satellite, internet website, newspaper, periodical, billboard,
mail, or any other distribution of printed materials, that is made
within 60 days of the initiation of voting in an election, that does not
support or oppose a candidate or ballot issue, that can be received by
more than 100 recipients in the district voting on the candidate or
ballot issue, and that:
(i) refers to one or more clearly identified candidates in that election;
(ii) depicts the name, image, likeness, or voice of one or more clearly
identified candidates in that election; or
(iii) refers to a political party, ballot issue, or other question submitted
to the voters in that election.
Mont. Code Ann. § 13–1–101(15)(a). The regulatory definition is almost identical
to the statutory definition. See Admin. R. Mont. 44.11.605.
MCD makes at least two arguments in support of its contention that this
definition is vague. First, MCD contends that the definition is vague because the
question of whether an electioneering communication “can be received by more
than 100 recipients” is an indeterminable standard. The Court disagrees and finds
that in the vast majority of cases it would not be challenging to determine if 100
people could receive a communication.
Here, for example, MCD states that it desired to distribute the
aforementioned mailers in fall of 2014. It would thus be simple for MCD to
determine if its mailers could be received by 100 people because the organization
itself would know how many mailers, i.e., electioneering communications, were
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sent. Further, issues of newspaper or televison communications would also be
easily ascertainable. The sender would merely inquire with the distributor
concerning the number of people in the publication or viewing audience. MCD
also argues that internet distribution is particularly problematic because it would
be much harder to determine if 100 individuals received the communication. The
Court agrees that there may be instances where it is not initially clear whether 100
people in a particular voting district would receive a communication if it was
distributed over the internet. However, this does not render the statute facially
vague. California Teachers Ass’n, 271 F.3d at 1151 (stating that “constitution
must tolerate a certain amount of vagueness”).
Second, MCD argues that ARM 44.11.605(1)(c) is vague because it leaves
people guessing as to their reporting requirements. Again, MCD reads vagueness
into the statute. The Court agrees with Defendants that the reporting required of
an entity depends on its committee classification. Here, MCD desires to distribute
mailers that Defendants identify as electioneering communications. Admin. R.
Mont. 44.11.605(1)(c); Mont. Code Ann. § 13–1–101(15)(a). This type of
communication is an expenditure. Mont. Code Ann. § 13–1–101(17)(a)(ii).
Entities that make an expenditure, but do not support or oppose a candidate, must
register and report as an incidental committee. Mont. Code Ann.
-39-
§ 13–1–101(22)(a). Therefore, application of this regulation to MCD is not vague
and Defendants’ motion for summary judgment on Count 18 (misidentified as
Count XVII) is granted.
Thus, ultimately, because MCD’s vagueness arguments fail, the Court
grants summary judgment to Defendants on Counts III, IV, V, VIII, IX, XI, XII,
XIII, XIV, XV, and XVI of MCD’s second amended complaint.
C. Exacting Scrutiny
Next, MCD challenges Montana’s political committee definitions and
disclosure requirements as failing scrutiny review. MCD also challenges these
statutes and regulations as facially overbroad.
“[A] campaign finance disclosure requirement is constitutional if it survives
exacting scrutiny, meaning that it is substantially related to a sufficiently important
governmental interest.” Human Life of Washington Inc. v. Brumsickle, 624 F.3d
990, 1005 (9th Cir. 2010). Disclosure requirements are constitutional because
though they “may burden the ability to speak . . . [they] do not prevent anyone
from speaking.” Citizens United v. Fed. Election Commn., 558 U.S. 310, 366
(2010) (citations omitted).
1. Governmental Interest
First, the Court is satisfied that Montana’s disclosure laws serve “a
-40-
sufficiently important governmental interest.” Brumsickle, 624 F.3d at 1005. As
discussed in this Court’s opinion in National Association for Gun Rights, Inc., v.
Murry, “disclosure provides the electorate with information as to where political
campaign money comes from and how it is spent by the candidate in order to aid
the voters in evaluating those who seek . . . office.” 969 F. Supp. 2d 1262, 1267
(D. Mont. 2013) (quoting Buckley v. Valeo, 424 U.S. 1, 66–67 (1976); see also
Brumsickle, 624 F.3d at 1005 (“[D]isclosure laws help ensure that voters have the
facts they need to evaluate the various messages competing for their attention.”).
Further, “[p]roviding information to the electorate is vital to the efficient
functioning of the marketplace of ideas, and thus to advancing the democratic
objectives underlying the First Amendment.” Brumsickle, 624 F.3d at 1005. Also,
in addition to providing voters with information, disclosure laws also serve to
deter actual corruption and avoid the appearance thereof, and aid in “gathering the
data necessary to enforce more substantive electioneering restrictions.” Alaska
Right To Life Comm. v. Miles, 441 F.3d 773, 793 (9th Cir. 2006) (citation
omitted).
As discussed, the Court finds that Montana’s disclosure laws serve a
important, if not compelling, government interest. Due the dramatic rise in
election spending in the last few decades, Montana’s voters are inundated with
-41-
political televison advertisements and mailers. These communication seek to
inform (or misinform) the voters and sway their opinions. Providing Montana
voters with information about individuals and groups competing for their attention
serve important government interests.
2. Substantial Relationship
As discussed, in order to satisfy exacting scrutiny, a disclosure law must be
“substantially related” to the government interest. Brumsickle, 624 F.3d at 1005.
MCD contends that multiple committee definitions and disclosure requirements
are not substantially related and thus fail to meet exacting scrutiny. The Court will
address each argument in turn.
MCD initially argues that Montana’s reporting requirements are so
burdensome, that no government interest could satisfy their requirements. The
Court disagrees. As stated, if MCD would have distributed its mailers, the
organization would have been required to register as a political committee. This
would have required MCD to complete a form called the Statement of
Organization (Form C-2). (Doc. 122-1.) Motl states that the C-2 form would take
about 10 minutes to complete and would require the committee to list a
“treasurer/contact for the group, a brief description of the committee type and
purpose, a list of the names of candidates identified by expenditure and the name
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and address of the bank used by the political committee.” (Doc. 122 at 3.)
If the group qualified as an incidental committee, it would then be required
to complete a C-4 form (Doc. 122-2) within five days of making an expenditure.
This is a three page form that can be completed at the same time as the filing of the
C-2 form. The C-4 form requires some basic information about the committee and
a brief description of the expenditure. Committees that continue to make
expenditures would need to file additional C-4 forms for each expenditure. The
Court has reviewed these forms and deems them less complicated than federal or
state personal income tax forms.
However, MCD alleges that ARM 44.11.402(5) and 44.11.302 impose
substantial burdens on political committees. These regulations require that a
contribution, as described in MCA § 13–1–101(9)(a), be reported within two days
of its receipt. Admin. R. Mont. 44.11.402(5). Additionally, this report must be
filed electronically with the Commissioner. Admin. R. Mont. 44.11.302. MCD
charges that, first, these requirements require undue excessive reporting, and
second, electronic reporting is burdensome due to Montana’s rural nature. The
Court disagrees.
First, repeated reporting reflects the reality of election expenditures and
contributions. Political committees are constantly making new expenditures and
-43-
receiving contributions. It is common sense that in order to inform the electorate
about a committee’s spending or receipt of funds before an election, these events
must be reported on a continual and timely basis. Second, the Court strenuously
disagrees with MCD that electronic reporting is burdensome. Electronic reporting
allows for timely reporting and furthers the State’s interest in transparency.
Further, the United States Supreme Court has recognized the benefits of electronic
reporting. See Citizens United, 558 U.S. at 370 (discussing how “modern
technology makes disclosures rapid and informative”). Finally, as discussed
above, ARM 44.11.302 allows committees to opt-out of electronic reporting.
Thus, the above-discussed regulations satisfy exacting scrutiny.
Next, MCD alleges that Montana’s requirement that election
communications, electioneering communications, and independent expenditures
include a “paid for by” attribution does not meet exacting scrutiny. Mont. Code.
Ann. § 13–35–225; Admin. R. Mont. 44.11.601. MCD contends that these are
content based restrictions that are “not narrowly tailored to serve an overriding
state interest[,] they compel information already disclosed to the Commissioner[,]
and are underinclusive because they require insufficient information.” (Doc. 129
at 31 (citing Am. Civ. Liberties Union of Nev., 378 F3d at 998).) MCD is
incorrect.
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First, the Court disagrees with MCD’s characterization of these provisions
as not narrowly tailored. In American Civil Liberties Union of Nevada v. Heller,
the Ninth Circuit held unconstitutional a state statute that required disclosure of
the names and addresses of the persons who either paid for or were “responsible
for paying for the publication of any material or information relating to an
election, candidate or any question on a ballot to identify their names and
addresses on any published printed or written matter or any photograph.” 378
F.3d at 981, 1002 (quotation and punctuation marks omitted). There, the Court
found the statute impermissibly overbroad because it was not narrowly tailored to
serve an overriding state interest. Id. at 993–1001. This conclusion was based in
large part by the wide-ranging application of the statue which applied to “any
material or information relating to an election.” Id. at 986.
However, after finding that the statute was not narrowly tailored, the Court
clarified that its holding in no way proscribed another more finely tuned statute
which required disclosure on the publication. See id. at 1000 (“Our conclusion
that the Nevada statute at issue here is not narrowly tailored to assist the state in
enforcing other campaign finance laws should not in any way suggest that an
on-publication identification requirement could never be narrowly tailored to
achieve this goal.”).
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Indeed, in Yamada, the Ninth Circuit upheld a statute that required onpublication disclosure due, in large part, because the burdens imposed were
minimal. Yamada, 786 F.3d at 1202 (describing the statute as imposing “only a
modest burden on First Amendment rights”). Here, like the statute at issue in
Yamada, the disclosure required under Montana’s so-called “anonymous speech
ban” only requires the “name and address of the person who made or financed the
expenditure for the communication.” Mont. Code. Ann. § 13–35–225. Thus, to
be in compliance with this statute, the vast majority of communications would
only be required to add a sentence or two at most. Also, unlike the statute in
Heller, which applied to “any material or information relating to an election,”
Montana’s statute only applies to a handful of specifically designated
communications. See Mont. Code. Ann. § 13–35–225(1). Montana’s statute is
thus easily distinguishable from the one at issue in Heller. The Court finds that
the First Amendment burdens imposed by this statute are outweighed by the
benefits of disclosure to the electorate.
Additionally, the Court notes that MCD’s mailers would qualify as an
electioneering communication. The disclosure requirement for this
communication only goes into effect if it is made sixty days before an election.
See Mont. Code. Ann. § 13–1–101(15)(a). Here, the Court finds that Montana’s
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requirement that electioneering communications include a “paid for by” attribution
is narrowly tailored because the disclosure requirements only go into effect within
the two months leading up to an election. Yamada, 786 F.3d at 1203 n.14
(“Citizens United’s post-McIntyre, post-Heller discussion makes clear that
disclaimer laws . . . may be imposed on political advertisements that discuss a
candidate shortly before an election.”).
Accordingly, the Court concludes that Montana’s political committee
disclosure requirements and definitions are “substantially related to a sufficiently
important governmental interest,” and satisfy scrutiny review because the
disclosure required under them “increases as a political committee more actively
engages in campaign spending and as an election nears.” Brumsickle, 624 F.3d
990 at 1013.19 The Court grants summary judgment to Defendants on Counts X,
19 (misidentified as XVIII) and 20 (misidentified as XIX).
D. Overbreadth Challenges
Closely related to MCD’s challenges under exacting scrutiny, the
organization also challenges Montana’s political committee statutory and
19
MCD also argues that the Commissioner’s investigatory powers are also
unconstitutional under scrutiny review. See Mont. Code. Ann. § 13–37–111; Admin. R. Mont.
44.11.106. However, as discussed in section I.B. of this Order, MCD fails to allege a viable
injury in fact due to the enforcement of these powers. Thus, MCD lacks standing to challenge
these provisions under scrutiny review.
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regulatory definitions as unconstitutionally overbroad. Specifically, MCD
contends that Montana’s law and regulations pertaining to political committees are
overboard. However, because the Court has determined that Montana’s political
committee laws satisfy exacting scrutiny, the Court need not address MCD’s
overbreadth arguments because MCD is incapable of showing that the alleged
overbreadth of these provisions “is both real and substantial.” Broadrick v.
Oklahoma, 413 U.S. 601, 613 (1973). Thus, the Court rejects MCD’s overbreadth
arguments as they pertain to MCA § 13–1–101(30) (“Political committee”
statutory definition) and ARM 44.11.202(2) (“Political committee” regulatory
definition). However, in the interest of thoroughness, the Court will briefly
address a few of MCD’s arguments pertaining to overbreadth.
MCD argues that Montana’s political committee definitions are overly
broad because they are not limited to groups with the “major purpose” of
nominating or electing candidates. However, as discussed in the Court’s Order
denying the motion for preliminary injunction, the Ninth Circuit has rejected any
bright-line “major purpose test.” See Yamada, 786 F.3d at 1200–1201
(“[Plaintiff’s] argument that regulations should reach only organizations with a
primary purpose of political advocacy also ignores the ‘fundamental
organizational reality that most organizations do not have just one major
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purpose.’”) (quoting Brumsickle, 624 F.3d at 1011. MCD’s “major purpose”
argument is thus without support.
Next, similar to its vagueness arguments, MCD also apparently challenges
MCA § 13–1–101(15) and ARM 44.11.605 as overbroad, which discuss the
definition of electioneering communications. In its brief in support of summary
judgment, MCD states that the “vast sweep [of these regulations] (which could
include filings in this lawsuit) bears no substantial relation to Montana’s
information interest.” (Doc. 129 at 30.) The Court disagrees and rejects MCD’s
argument for the reasons discussed in section II.C.2. The Court grants summary
judgment to Defendants on Counts I and VI.
E. As-Applied Challenge
Finally, MCD contends that Montana’s political committee definitions,
specifically MCA § 13–1–101(30) and ARM 44.11.202(2), are unconstitutional
as-applied to the organization. MCD states that it has no interest in engaging in
political activities and merely seeks to “promote the social welfare” by “engaging
in grassroots advocacy and issues-oriented educational campaigns.” (Doc. 126 at
21.) MCD asserts that it only intends to engage in issue advocacy and thus
Montana’s political committee and disclosure laws are not tailored to any
cognizable interest as applied to the organization. Again, the Court disagrees.
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“An as-applied challenge contends that the law is unconstitutional as
applied to the litigant’s particular speech activity, even though the law may be
capable of valid application to others.” Foti v. City of Menlo Park, 146 F.3d 629,
635 (9th Cir. 1998) (citations omitted). Further, “[a] successful as-applied
challenge does not render the law itself invalid but only the particular application
of the law.” Id.
As discussed, the State of Montana has an important, if not compelling,
interest in the regulation of political speech during the time immediately preceding
an election. Alaska Right To Life Comm., 441 F.3d at 793 (“[T]here is a
compelling state interest in informing voters who or what entity is trying to
persuade them to vote in a certain way.”). Here, MCD desired to send “issue
advocacy” mailers in the sixty days preceding the 2014 election. Further, these
mailers would cost in excess of $250 and name candidates for political office, in
addition to including their images. MCD states that it desires to engage in
political speech, though it argues that it does not support or oppose a particular
political candidate.20 (Doc. 126 at 21.) Despite this assertion, these mailers would
qualify as electioneering communications and would require MCD to register as a
20
This assertion is apparently contradicted by the testimony of Bill Coate, the President
of MCD, who stated that the organization’s message is “irrelevant unless people are educated on
how they go into the voting booth.” (Doc. 123-1 at 14.)
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incidental committee and report its expenditures. As described, the burdens
associated with incidental committee reporting are minimal and narrowly tailored
to the State’s interest in disclosure. Further, as discussed, MCD’s incidental
committee reporting requirements satisfy exacting scrutiny.
Despite this finding, MCD argues that Montana cannot regulate its speech
because it does not have a “major purpose, a primary purpose, or even a priority of
the nomination or election of a candidate or candidates in Montana.” (Doc. 129 at
28 (internal quotation marks omitted).) These arguments have been rejected by
the Ninth Circuit. Yamada, 786 F.3d at 1200; Brumsickle, 624 F.3d at 1011; see
also Ctr. for Individual Freedom v. Madigan, 697 F.3d 464, 489 (7th Cir. 2012)
(“[L]imiting disclosure requirements to groups with the major purpose of
influencing elections would allow even those very groups to circumvent the law
with ease.”). Also, even if the Court takes MCD at its word that it intends to
pursue only issue advocacy, regulation of issue advocacy is permitted if justified
by a compelling state interest. Alaska Right To Life Comm., 441 F.3d at 793.
Here, regulation of MCD’s electioneering communications, which seek to
“educate” the electorate about candidates for office in the time preceding an
election, is warranted because it provides “the voting public with the information
with which to assess the various messages vying for their attention in the
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marketplace of ideas.” Brumsickle, 624 F.3d at 1008. Further, and most
importantly, MCD provides no explanation why the organization is incapable of
complying with Montana’s disclosure requirements. Id. at 1022 (rejecting an asapplied challenge brought by an organization because it was unable to show why it
could not comply with the state’s disclosure laws). Consequently, requiring MCD
to disclose that it is distributing these mailers is constitutionally sound. The Court
thus finds that these regulations are constitutional as-applied to MCD. The Court
grants summary judgment to Defendants on Counts II and VII.
Accordingly,
IT IS ORDERED that Defendants’ Motion for Summary Judgment (Doc
119) is GRANTED.
IT IS FURTHERED ORDERED that Plaintiff’s Motion for Summary
Judgment (Doc. 125) is DENIED.
IT IS FURTHERED ORDERED that Defendants’ Motion to Strike (Doc.
169) is GRANTED.
The Clerk of Court is directed to enter judgment in favor of Defendants and
against Plaintiff.
This case is CLOSED.
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DATED this 31st day of October, 2016.
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