General Majority PAC v. Aichele et al

Filing 24

MEMORANDUM re pltf's MOTION for Judgment on the Pleadings 18 (Order to follow as separate docket entry) Signed by Honorable William W. Caldwell on 08/13/14. (ma)

IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF PENNSYLVANIA
GENERAL MAJORITY PAC,
Plaintiff
v.
CAROL AICHELE, in her official
capacity as Pennsylvania Secretary of
State; KATHLEEN KANE, in her official
capacity as Pennsylvania Attorney
General; JONATHAN M. MARKS, in his
official capacity as Commissioner of
Pennsylvania’s Bureau of Commissions,
Elections and Legislation; IAN
HARLOW, in his official capacity as
Deputy Commissioner of
Pennsylvania’s Bureau of Commissions,
Elections and Legislation; and TRISHA
MALEHORN, in her official capacity as
Chief of the Division of Campaign
Finance and Lobbying Disclosure of
Pennsylvania’s Bureau of Commissions,
Elections and Legislation;
Defendants

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: CIVIL NO. 1:14-CV-332
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MEMORANDUM
I.

Introduction
This case calls into question the constitutionality of a provision of

Pennsylvania’s Election Code that limits the fundraising activities of political
committees operating within the state following the United States Supreme Court’s
decision in Citizens United v. Federal Election Commission, 558 U.S. 310 (2010). The
Commonwealth of Pennsylvania concedes that the challenged provision no longer
passes constitutional muster, and the only matter remaining to be decided is the
scope of this court’s order permanently enjoining its enforcement.

For the reasons that follow, we will enter a narrowly tailored order striking
down the offending provision and permanently enjoining the Commonwealth from
enforcing it. We will, however, decline the Commonwealth’s invitation to go further by
entering an order that substantially rewrites the Election Code and any applicable
rules and regulations. That task is properly left to the Pennsylvania General Assembly
and Bureau of Commissions, Elections and Legislation.
II.

Background
A.

Campaign Finance Regulations and Citizens United

As the Supreme Court recently affirmed, there is no right in our
democracy more basic than the right to participate in electing our political leaders.
McCutcheon v. Fed. Election Comm’n, 134 S. Ct. 1434, 1440-41 (2014). Participation
comes in many different forms–citizens can run for office, vote, urge others to vote for
a particular candidate or candidates, or volunteer to work for a campaign. Id. at 1441.
Most pertinent to today’s analysis, though, is another form of participation: political
giving and spending.
By making a direct monetary donation to a political campaign (giving), or
by expending resources in an effort to promote particular candidates or policies
(spending), individuals can influence our political landscape. The Supreme Court has
concluded that by making such “contributions” or “expenditures,” as they are formally
known, individuals exercise their protected First Amendment rights to free expression
and association. See id. at 1448.
In essence, an individual’s political giving and spending amounts to a
symbolic expression of support for a candidate or issue and serves to affiliate the
individual with a candidate or cause. The influx of money also increases the overall

quantity of political expression by providing a means through which ideas can be
disseminated to the public at large–for example, by funding the political
advertisements that populate the airwaves. Thus, when an individual puts his money
where his proverbial mouth is through political giving and spending, that conduct falls
within the realm of protected First Amendment activities.
Over the past four decades since the landmark campaign finance
decision Buckley v. Valeo, 424 U.S.1 (1976), the Supreme Court has repeatedly
examined the constitutional implications of political giving and spending and legislative
efforts to limit those activities. During that time, the Court has considered and rejected
various justifications for limiting both direct political contributions and independent
expenditures–i.e., political spending that is not approved by or coordinated with a
candidate.
Ultimately, in 2010’s Citizens United, the Court concluded that the only
legitimate governmental interest in limiting political spending–and thereby restricting
protected First Amendment activities–is avoiding corruption or the appearance of
corruption. See id., 558 U.S. at 365. From this premise, the Court found that a federal
law that banned corporations from making independent expenditures violated the First
Amendment. The Court reasoned that “independent expenditures, including those
made by corporations, do not give rise to corruption or the appearance of corruption”
because spending without “prearrangement and coordination” with a candidate
“alleviates the danger that expenditures will be given as a quid pro quo for improper

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commitments from the candidate.” Id. at 357 (internal citation and quotation marks
omitted).1
In the wake of this decision, suits were filed across the country
challenging the constitutionality of various federal, state, and local election provisions
that limited the amount of money individuals or organizations could contribute to
groups that make only independent expenditures. The United States Court of Appeals
for the District of Columbia Circuit became the first federal appellate court to address
the issue, striking down as unconstitutional a federal law capping such contributions.
See SpeechNow.org v. Fed. Election Comm’n, 599 F.3d 686 (D.C. Cir. 2010). The
D.C. Circuit reasoned that “because Citizens United holds that independent
expenditures do not corrupt or give the appearance of corruption as a matter of law,
then the government can have no anti-corruption interest in limiting contributions to
independent expenditure-only organizations.” Id. at 696.
Every federal appellate court to address the issue since has reached the
same conclusion, striking down various contribution limits to independent expenditure
groups. See, e.g., Republican Party v. King, 741 F.3d 1089, 1095-96 (10th Cir. 2013)
(holding that “political committees that are not formally affiliated with a political party or
candidate may receive unlimited contributions for independent expenditures”); N.Y.
Progress & Prot. PAC v. Walsh, 733 F.3d 483, 487 (2d Cir. 2013) (holding that an

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Despite popular misconceptions, Citizens United did not announce that
“corporations are people.” The Court had previously recognized that First Amendment
protections extend to corporations and other associations of individuals, and not just
“natural persons.” Id. at 342-43 (collecting cases). Similarly, Citizens United did not
declare that “money is speech”; rather, it was the latest in a line of decisions
recognizing that political giving and spending are protected First Amendment activities.
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aggregate limit on an individual’s contributions is unconstitutional as applied to
contributions to independent expenditure-only groups); Texans for Free Enter. v. Tex.
Ethics Comm’n, 732 F.3d 535, 538 (5th Cir. 2013) (holding that a state law ban on
corporate contributions cannot be applied to independent expenditure committees);
Wis. Right to Life State PAC v. Barland, 664 F.3d 139, 143 (7th Cir. 2011) (holding
that a state law restricting contributions to $10,000 cannot be applied to independent
expenditure committees); Long Beach Area Chamber of Commerce v. City of Long
Beach, 603 F.3d 684, 698-99 (9th Cir. 2010) (holding that a local ordinance restricting
contributions cannot be applied to a political action committee seeking to use funds for
independent expenditures); see also N.C. Right to Life, Inc. v. Leake, 525 F.3d 274,
293 (4th Cir. 2008) (holding–even before the issuance of Citizens United–that a state
law limiting contributions to $4,000 could not be constitutionally applied to independent
expenditure committees).
This case presents an identical challenge to Pennsylvania’s Election
Code, which, as discussed below, prevents independent expenditure-only political
committees from accepting contributions from corporations and unincorporated
associations.
B.

Pennsylvania’s Election Code

Pennsylvania’s Election Code prohibits entities such as banks,
corporations, and unincorporated associations from making political contributions or
expenditures. Nutter v. Dougherty, 921 A.2d 44, 51 (Pa. Commw. Ct. 2007) (citing 25
P.S. § 3253); Ctr. for Individual Freedom v. Corbett, No. 07-2792, 2008 U.S. Dist.
LEXIS 45236, *1 (E.D. Pa. May 5, 2008) (stating that “Pennsylvania campaign finance

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law prohibits corporations and unions from making any ‘expenditure in connection with
the election of any candidate or for any political purpose whatever’”) (quoting
§ 3253(a)). Candidates and political committees are similarly prohibited from
knowingly accepting or receiving contributions from corporations and unincorporated
associations. In re Petition to Audit Campaign Fin. Reports of Cartwright, 900 A.2d
448, 454-55 (Pa. Commw. Ct. 2006) (stating that § 3253(a) “makes it unlawful for any
candidate to knowingly accept or receive any contribution from any corporation”).
Violators can face harsh criminal penalties, including imprisonment and fines. See
§§ 3543, 3550.
The Election Code makes no exception from this general prohibition for
contributions by corporations and associations to groups that make only independent
expenditures.2 Thus, as the law currently stands, corporations and unincorporated
associations (including labor unions) are prevented from contributing to independent
expenditure-only groups, and those groups are prohibited from accepting such
contributions.

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The Election Code does recognize “independent expenditures” as a particular
subset of potential “expenditures,” but it does not except independent expenditureonly groups from the general contribution prohibition discussed above. Compare
§ 3241(d)(1) (generally defining an “expenditure” as money spent “for the purpose of
influencing the outcome of an election”), with § 3241(e) (defining an “independent
expenditure” as “an expenditure by a person made for the purpose of influencing an
election without cooperation or consultation with any candidate or any political
committee authorized by that candidate and which is not made in concert with or at the
request or suggestion of any candidate or political committee or agent thereof”)
(emphasis added).
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C.

Procedural History of this Lawsuit3

The plaintiff in this lawsuit, General Majority PAC (“GMP”), is a political
organization based in Washington, D.C. It was established for the sole purpose of
influencing legislative elections in various states by making independent expenditures
in support of Democratic candidates. Prior to initiating this lawsuit, GMP refrained from
soliciting or accepting donations from individuals, corporations, labor unions, and other
unincorporated associations in Pennsylvania, and from making independent
expenditures advocating the election of Democratic legislative candidates in the state.
On September 3, 2013, GMP contacted Pennsylvania’s Bureau of
Commissions, Elections and Legislation (“BCEL”) to confirm that in light of Citizens
United and subsequent court decisions, the Commonwealth would no longer seek to
enforce the provision of its Election Code that prohibits political committees that make
only independent expenditures from accepting or receiving any contributions from
corporations or unincorporated associations. The BCEL responded, stating that the
contribution prohibition remained in full force and effect.
Unable to achieve relief through administrative channels, GMP initiated
this federal lawsuit on February 24, 2014, to challenge the constitutionality of the
Election Code’s contribution prohibition. GMP’s complaint names Carol Aichele,
Secretary of the Commonwealth, Pennsylvania Attorney General Kathleen Kane, and
other state officials as defendants (collectively, “the Commonwealth”). GMP seeks an
order from this court declaring that the Election Code’s contribution prohibition is

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The parties do not dispute the facts underlying this case, and our recitation of
these facts stems from the parties’ own briefing (Docs. 19, 21).
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unconstitutional as applied to political committees that make only independent
expenditures. GMP also requests that we permanently enjoin the Commonwealth from
enforcing the contribution prohibition with respect to independent expenditure-only
groups, and enjoin any related rules and regulations.
Along with its complaint, GMP also filed a motion requesting that we
enter a preliminary injunction preventing the Commonwealth from enforcing the
contribution prohibition to independent expenditure-only groups pending the ultimate
resolution of this lawsuit. We conducted a conference with the parties on February 27,
2014, at which point the Commonwealth indicated that it would neither oppose the
entry of the preliminary injunction nor contest the merits of this case. In light of the
Commonwealth’s concession that its Election Code is no longer constitutionally sound,
we entered an order (Doc. 15) granting GMP’s motion for preliminary injunction. The
parties further agreed to negotiate the terms of a consent judgment to resolve this
case entirely.
After the parties were unable to reach an agreement, GMP filed the
instant motion for judgment on the pleadings (Doc. 18) on July 2, 2014. Noting that
there are no factual disputes and that the parties agree that the challenged Election
Code provision cannot stand constitutional scrutiny, GMP requests that we convert the
preliminary injunction previously entered into a permanent injunction. The
Commonwealth agrees that a permanent injunction is warranted, but requests that our
final order go further than our first. Specifically, the Commonwealth requests that we
“expressly note th[e] continuing obligation” to comply with provisions of the Election
Code that were not the subject of this litigation. (Doc. 21 at 4). Additionally, the

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Commonwealth would have us effectively rewrite the Election Code and its
implementing regulations by establishing a new category of “independent political
committees”; setting forth the requirements for becoming one of these committees;
and directing the Pennsylvania Department of State to promulgate forms for the
certification of these committees. (Doc. 21-1 at 2-3). GMP opposes this request.
The matter has been fully briefed (Docs. 19, 21, 23), and it is ripe for disposition.
III.

Discussion
Pennsylvania’s Election Code prohibits corporations and unincorporated

associations from contributing to independent expenditure-only groups, and these
groups are similarly prohibited from accepting such contributions. 25 P.S. § 3253(a).
In the wake of Citizens United, however, this prohibition on political spending that is
neither prearranged nor coordinated with a candidate amounts to an impermissible
restriction of protected First Amendment activity. Thus, we must strike down as
unconstitutional the contribution prohibition as applied to groups that make only
independent expenditures. See Marbury v. Madison, 5 U.S. 137, 180 (1803) (stating
that “a law repugnant to the Constitution is void”).
In reaching this conclusion, we join a host of federal courts, including the
Courts of Appeals for the Second, Fifth, Seventh, Ninth, Tenth, and D.C. Circuits, to
find statutory limitations on independent expenditures unconstitutional following
Citizens United. See, e.g., N.Y. Progress & Prot. PAC, 733 F.3d at 487; Texans for
Free Enter., 732 F.3d at 538; Wis. Right to Life State PAC, 664 F.3d at 143; Long
Beach Area Chamber of Commerce, 603 F.3d at 698-99; Republican Party, 741 F.3d
at 1095-96; SpeechNow.org, 599 F.3d at 696. Even the Commonwealth concedes

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that our conclusion is compelled by Citizens United–the contribution prohibition
contained in the Election Code can no longer be applied to independent expenditureonly groups. (Doc. 21 at 2) (stating that the Commonwealth has “consistently
indicated, through [its] counsel, that based on the Supreme Court’s decision in
Citizens United . . ., [it] could not defend–on the merits–the claims raised by GMP in
the Complaint”).
The only issue in this case the parties disagree on is the proper scope of
our order permanently enjoining the enforcement of the unconstitutional contribution
prohibition. GMP contends that our order should be narrowly tailored and limited to the
issues raised in this case: it should simply declare the Election Code’s contribution
prohibition unconstitutional as applied to independent expenditure-only committees
and permanently enjoin the Commonwealth from enforcing the prohibition.
The Commonwealth agrees that this relief is appropriate, but curiously
requests that our order striking down part of its own Election Code go further still.
Specifically, the Commonwealth requests that our order include affirmative statements
about Election Code provisions not at issue in this case. Essentially, the
Commonwealth seeks a written reminder that Election Code provisions that have not
been considered or invalidated by this court–like the provisions addressing issues
such as registration of political committees and contribution reporting
requirements–remain in effect. Second, the Commonwealth asks that we rewrite the
Election Code in part by crafting a new category of Pennsylvania law for “independent
political committees.” The Commonwealth would have us define the requirements of
this new political group and compel the Pennsylvania Department of State to establish

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and maintain the necessary forms for independent political committees to certify their
compliance with the Election Code. (Doc. 21-1 at 2-3).
We conclude that GMP’s proposal charts the appropriate course. Our
permanent injunction should be narrowly tailored to address the constitutional harm in
this case. See Interfaith Cmty. Org. v. Honeywell Int’l, Inc., 399 F.3d 248 (3d Cir.
2005) (stating that “federal courts should ensure ‘the framing of relief no broader than
required by the precise facts’”) (quoting Friends of the Earth, Inc. v. Laidlaw Envtl.
Servs. (TOC), Inc., 528 U.S. 167, 193 (2000)). Accordingly, we find that neither of the
Commonwealth’s proposed additions to the terms of the permanent injunction order is
warranted.
With respect to the Commonwealth’s first proposal, there is no need for
our order to discuss issues that were not raised in this litigation. Much as a written
reminder that murder remains illegal in the Commonwealth is unnecessary to resolve
this case, so too is the reminder that individuals and organizations must comply with
the various provisions of the Election Code that were not addressed here.
As for the Commonwealth’s second request for us to establish a new
category of “independent political committees,” we will not usurp the role of the
democratically elected General Assembly or the BCEL by substantively rewriting the
Election Code. That task goes beyond the limited role of the federal courts in our
system of government. Having excised the offending independent expenditure

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limitation from the Election Code, we leave it to the Commonwealth to amend its laws
in accordance with the constitutional principles addressed today.4
IV.

Conclusion
In Citizens United, the Supreme Court made it clear that the First

Amendment forbids governments from limiting political spending in the form of
independent expenditures. Section 3253(a) of Pennsylvania’s Election Code,
however, does just that by prohibiting corporations and unincorporated associations
from contributing to political groups that make only independent expenditures. As a
result, we are compelled to find this prohibition unconstitutional and enter the attached
order permanently enjoining the Commonwealth from enforcing it.

/s/ William W. Caldwell
William W. Caldwell
United States District Judge

August 13, 2014

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In fact, this process has already begun. Since the issuance of the preliminary
injunction, the Commonwealth has already provided guidance and promulgated
regulations permitting independent expenditure-only groups to accept contributions
from corporations and unincorporated associations. (Docs. 23-1, 23-2).
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