COLLEEN KOLLAR-KOTELLY, United States District Judge.
Plaintiff Independence Institute, a Colorado non-profit organization, brought this action against Defendant Federal Election Commission ("FEC"), seeking declaratory and injunctive relief declaring that the disclosure provisions of the Bipartisan Campaign Reform Act of 2002 ("BCRA") are unconstitutional as applied to a specific radio advertisement that Plaintiff plans to run before the November 4, 2014, federal elections. Presently before the Court are Plaintiff's [3] Application for a Three Judge Court and Plaintiff's [5] Motion for Preliminary Injunction. In the interest of expediting the resolution of this action, the parties agreed that the Court would rule on the merits of the Complaint as opposed to the preliminary injunction. Upon consideration of the pleadings,
Independence Institute is a nonprofit corporation that "conducts research and educates the public on various aspects of public policy — including taxation, education policy, health care, and justice policy." Compl. ¶ 2. Independence Institute plans to produce a radio advertisement that will ask the current United States senators from Colorado, Mark Udall and Michael Bennet, to support the Justice
Plaintiff brought this action seeking declaratory and injunctive relief with respect to the advertisement it plans to run. Plaintiff seeks to have the merits adjudicated by a three judge court. Plaintiff also filed a motion for preliminary injunction because the 60-day window before the November election, during which BCRA's requirements apply, had already begun. In the interest of expediting the resolution of the case, the parties agreed to consolidate briefing on the preliminary injunction with briefing on the merits, relying initially on Plaintiff's merits arguments with respect to the preliminary injunction. Joint Stip. at 1-2. The parties further agreed, "in light of Plaintiff Independence Institute's agreement not to supplement its Motion for Preliminary Injunction (Docket No. 5) with supplemental substantive briefing or evidence, for the Court to consider Plaintiff's Motion for Preliminary Injunction as a Motion for Summary Judgment and to follow the briefing schedule" previously set by the Court with respect to the preliminary injunction. Id. The parties also stipulated that "this case presents an as-applied challenge to 52 U.S.C. § 30104(f)(1)-(2) based upon the content of the Independence Institute's intended communication, and not the possibility that its donors will be subject to threats, harassment, or reprisals." Id. at 1.
The Bipartisan Campaign Reform Act of 2002, 116 Stat. 81, amended the Federal
Pursuant to BCRA section 201, "any person who spends more than $10,000 on electioneering communications within a calendar year must file a disclosure statement with the FEC."
In addition, BCRA section 203 originally prohibited corporations and unions from spending general treasury funds to finance electioneering communications, as defined in the Act.
Pursuant to BCRA section 403(a)(3), "any action [] brought for declaratory
This dispute can be distilled to the application of the Supreme Court's clear instructions in Citizens United: in no uncertain terms, the Supreme Court rejected the attempt to limit BCRA's disclosure requirements to express advocacy and its functional equivalent. See 558 U.S. at 369, 130 S.Ct. 876. Plaintiff in this case seeks the same relief that has already been foreclosed by Citizens United. Plaintiff's efforts to distinguish this challenge from that in Citizens United are futile. Moreover, it is clear that the additional precedent that Plaintiff attempts to enlist provides no more assistance to it than does Citizens United. Accordingly, Plaintiff's arguments lack merit.
In Citizens United, in a section that eight justices joined, the Supreme Court concluded that there was no constitutional defect in applying the disclosure requirements of BCRA section 201 to specific electioneering communications that were neither express advocacy nor the functional equivalent thereof.
Id. at 368-69, 130 S.Ct. 876 (citation omitted) (emphasis added). Despite this unambiguous language, Plaintiff attempts to argue that Citizens United does not determine the outcome of this case. Plaintiff first argues that this language was dicta and therefore not binding on this Court. Plaintiff next argues that, even if this language is binding, it does not govern the outcome of this challenge because Citizens United was an as-applied challenge addressing materially different facts. Specifically, Plaintiff offers what amounts to three distinctions: (i) that it is a 501(c)(3) organization while Citizens United is a 501(c)(4) organization; (ii) that its advertisement is not the functional equivalent of express advocacy while the ads in Citizens United, in Plaintiff's estimation, were the equivalent of express advocacy; and (iii) that its advertisement has no positive or negative references to a candidate while the advertisement in Citizens United referred to a candidate pejoratively. None of these distinctions have the effect Plaintiff desires, and Citizens United still governs this matter. The Court addresses these arguments in turn.
With respect to the argument that Citizens United's discussion of disclosures is not binding, Plaintiff relies heavily on one opinion from the Seventh Circuit Court of Appeals, Wisconsin Right to Life, Inc. v. Barland, 751 F.3d 804 (7th Cir.2014), which states that Citizen United's discussion of disclosures was dicta.
But in the same opinion, the Seventh Circuit panel ultimately concludes that the discussion of disclosures in Citizens United is binding with respect to BCRA section 201. Immediately after the statement that the relevant portion of Citizens United was dicta, the court in Barland states that "the Supreme Court's dicta must be respected, and on the strength of this part of Citizens United, we said in [Center for Individual Freedom v.] Madigan that the `distinction between express advocacy and issue discussion does not apply in the disclosure context.'" Id. (quoting Center for Individual Freedom v. Madigan, 697 F.3d 464, 484 (7th Cir.2012)). Notwithstanding its comment regarding dicta, the Seventh Circuit panel agrees that, as a result of the Supreme Court's discussion of disclosures in Citizens United, the express-advocacy limitation does not apply to the disclosure system established by BCRA.
Indeed, numerous other Circuit courts beyond the Seventh Circuit have determined that Citizens United's language forecloses the suggestion that disclosure requirements must be limited to express advocacy and its functional equivalent. See, e.g., Nat'l Org. for Marriage v. McKee, 649 F.3d 34, 54-55 (1st Cir.2011) ("We find it reasonably clear, in light of Citizens United, that the distinction between issue discussion and express advocacy has no place in First Amendment review of these sorts of disclosure-oriented laws.); Vermont Right to Life Comm., Inc. v. Sorrell, 758 F.3d 118, 132 (2d Cir. 2014) ("Citizens United removed any lingering uncertainty concerning the reach of constitutional limitations in this context. In Citizens United, the Supreme Court expressly rejected the `contention that the disclosure requirements must be limited to speech that is the functional equivalent of express advocacy,' because disclosure is a less restrictive strategy for deterring corruption and informing the electorate." (quoting Citizens United, 558 U.S. at 369, 130 S.Ct. 876) (citation and footnotes omitted)); Human Life of Wash. Inc. v. Brumsickle, 624 F.3d 990, 1016 (9th Cir.2010) ("Given the Court's analysis in Citizens United, and its holding that the government may impose disclosure requirements on speech, the position that disclosure requirements cannot
Independence Institute next argues that its status as a section 501(c)(3) organization under the Internal Revenue Code, whereas Citizens United is a section 501(c)(4) organization, requires a different result from Citizens United. But this is a distinction without a difference. Most importantly, nothing in Citizens United's discussion of disclosures of contributions cabins the Supreme Court's holding to certain types of organizations. See Citizens United, 558 U.S. at 367-70, 130 S.Ct. 876. Insofar as Plaintiff argues that the election disclosure requirements ought to be different for section 501(c)(3) organizations and section 501(c)(4) organizations because the tax code differentiates among them with respect to disclosures, this argument has no basis. Neither type of nonprofit organization is obligated by federal tax law to disclose donor information. See 26 U.S.C. § 6104(d)(3)(A); Amici Br. at 22-23.
Plaintiff also points to the Supreme Court's statement that "Citizens United has been disclosing its donors for years" while the Independence Institute has not. Pl.'s Mot. at 18. However, the purpose of the Supreme Court's statement was only to note that Citizens United had "identified no instance of harassment or retaliation" in its years of disclosing donors, thus defeating the argument that it could not be mandated to disclose because of "a reasonable probability that the group's members would face threats, harassment, or reprisals if their names were disclosed." Citizens United, 558 U.S. at 370, 130 S.Ct. 876 (citing McConnell, 540 U.S. at 198, 124 S.Ct. 619). However, such a probability is not an issue in this action because the parties have stipulated to that effect. Joint Stip. at 1. Accordingly, the Supreme Court's statement that Citizens United had been disclosing donors for years does not suggest a different outcome for the Independence Institute.
Ultimately, Plaintiff's effort to draw a line between different types of nonprofit organizations is not supported by any citation to authority that such a distinction would be required by the First Amendment. There is no reason to conclude that Citizens United's clear refusal to import the express advocacy-issue advocacy distinction into the disclosure context should be limited to advocacy by certain types of nonprofit organizations.
Plaintiff next argues that "Citizens United is distinct because it contemplated advertisements which could be fairly characterized as the functional equivalent of express advocacy." Pl.'s Reply at 9. Even aside from the merits of this characterization of the advertisement in Citizens United, this argument cannot prevail. When considering Citizens United's advertisements, the Supreme Court refused to draw a line between express advocacy and issue advocacy in the BCRA disclosure context. Citizens United, 558 U.S. at 368-69, 130 S.Ct. 876. In plain language, the Supreme Court stated that whether an electioneering communication is express advocacy or issue advocacy does not determine whether BCRA's disclosure requirement can be lawfully applied. Accordingly, even if it were clear that the advertisements in Citizens United were express advocacy and the one in this case were issue advocacy, the Supreme Court's holding in Citizens United would nonetheless resolve this dispute.
In an attempt to counter Defendant's argument that the advertisements at issue in Citizens United were not, in fact, express advocacy, Plaintiff adopts another approach. Plaintiff looks to Citizens United's reference to the Hillary advertisements as advocating a commercial transaction, in other words watching Hillary: The Movie. Pl.'s Reply at 11-12. Plaintiff argues that, if anything, this reference suggests that the Hillary advertisements deserved the reduced First Amendment protections afforded commercial speech. See id. This reference cannot be excised from its context. Responding to an argument that "an informational interest" did not apply to the Hillary advertisements, the Supreme Court concluded: "Even if the ads only pertain to a commercial transaction, the public has an interest in knowing who is speaking about a candidate shortly before an election. Because the informational interest alone is sufficient to justify application of § 201 to these ads, it is not necessary to consider the Government's other asserted interests." Citizens United, 558 U.S. at 369, 130 S.Ct. 876. In other words, even though the advertisement encourages someone to watch the movie rather than vote for a candidate, the public interest still supports disclosure of "who is speaking about a candidate." In no sense does this language imply that the Supreme Court determined that this speech deserved only the lesser First Amendment protections of commercial speech, "that is, expression related solely to the economic interests of the speaker and its audience." Cent. Hudson Gas & Elec. Corp. v. Pub. Serv. Comm'n of New York, 447 U.S. 557, 561, 100 S.Ct. 2343, 65 L.Ed.2d 341 (1980). In any event, with respect to Plaintiff's attempt to distinguish its advertisement from that of Citizens United, the reference to a commercial transaction does not alter the Supreme Court's clear conclusion: whether speech is express advocacy or issue advocacy does
Plaintiff next argues that Citizens United's clear conclusion with respect to BCRA's disclosure requirements ought to be limited to advertisements like the ones before the Supreme Court in that case, which spoke "pejoratively" about a candidate, rather than "genuine issue speech," as Plaintiff characterizes its proposed ad. See Pl.'s Reply at 14, 15-16. The Court does not disagree that the Hillary advertisements could be considered critical of then-candidate Hillary Clinton, while the advertisement in this action, on its face, says nothing positive or negative about a candidate for Federal office. But this is a distinction without a difference. Notwithstanding Citizen United's two references to the advertisements as pejorative, the language in Citizens United does not suggest that the pejorative nature of the advertisements in any way was important to the conclusion with respect to disclosures. The disclosures holding is neither explicitly nor implicitly limited to certain types of advertisements. See Citizens United, 558 U.S. at 368-69, 130 S.Ct. 876 ("Citizens United seeks to import a similar distinction into the BCRA's disclosure requirements. We reject this contention."). Examining the two references in context confirms that the disclosure discussion is not limited by those references.
In introducing the factual background of the case, the Supreme Court, within the first pages of the opinion, describes the advertisements: "Each ad includes a short (and, in our view, pejorative) statement about Senator Clinton, followed by the name of the movie and the movie's Website address." Id. at 320, 130 S.Ct. 876. This reference is separated from the discussion of the disclosure requirements by approximately 47 pages of the United States Reports, and nothing in either portion of the opinion suggests that the former reference is imported into the latter discussion. Moreover, the parenthetical phrasing of that reference suggests an aside rather than a core element of the Supreme Court's legal analysis.
When the Supreme Court turns to its analysis of the disclosure and disclaimer requirements, it describes the advertisements factually once again: "The ads fall within BCRA's definition of an `electioneering communication': They referred to then-Senator Clinton by name shortly before a primary and contained pejorative references to her candidacy." Id. at 368, 130 S.Ct. 876. In fact, the quoted language pertains to the discussion of BCRA section 311's disclaimer requirements, not section 201's disclosure requirements. Even though the discussions of section 311 and section 201 are located in the very same section of the opinion, the text of the opinion does not even hint that the Supreme Court meant to limit the disclosures holding by the adjective "pejorative."
Moreover, Plaintiff's claim that "Justice Kennedy use[d] the word `pejorative' in every instance in which the Court discusses the ads for Hillary: The Movie," Pl.'s Reply at 15, does not withstand scrutiny. Variations on the word "advertisement" show up in Justice Anthony Kennedy's opinion well over twenty times. Only the two times discussed in this section does he use the word pejorative. In sum, while the Hillary advertisements may very well
Arguing that Citizens United does not determine the outcome of this case, Plaintiff relies on alternative Supreme Court precedent to assert that the application of BCRA section 201's disclosure requirements to its advertisement is unconstitutional. In particular, Plaintiff cites to Buckley v. Valeo, 424 U.S. 1, 96 S.Ct. 612, 46 L.Ed.2d 659 (1976), and Federal Election Commission v. Wisconsin Right to Life, Inc. ("WRTL II"), 551 U.S. 449, 127 S.Ct. 2652, 168 L.Ed.2d 329 (2007), both decided prior to Citizens United, to argue that section 201's disclosure requirements may be applied constitutionally only to communications that contain express advocacy, or its functional equivalent. In fact, those cases do not indicate that result. Because Citizens United does foreclose Plaintiff's claim, the other cases Plaintiff cites are at best background. Even so, examining them reinforces the conclusion that they do not suggest a different outcome from Citizens United.
Plaintiff primarily relies on Buckley v. Valeo, 424 U.S. 1, 96 S.Ct. 612, 46 L.Ed.2d 659 (1976), which resolved a facial challenge to the Federal Election Campaign Act ("FECA"), to argue that, in the absence of Citizens United, Buckley's distinction between express advocacy and issue advocacy resurfaces in the context of the disclosure requirements of BCRA section 201. See Pl.'s Mot. at 10. However, that dichotomy emerged only as part of the Buckley Court's analysis of a particular statute, FECA (BCRA's predecessor), that is distinguishable from BCRA. Furthermore, the state interests in favor of disclosure that were highlighted in Buckley, in fact, support the disclosure requirements challenged in this case.
In upholding BCRA's disclosure requirements against a facial challenge,
Id. (emphasis added). This language prevents Plaintiff from wielding Buckley as a sword against BCRA's disclosure requirements. McConnell's status as a facial challenge is not to the contrary: the Supreme Court's understanding of the relevant
Second, McConnell explains that Buckley did not introduce a division between express advocacy and issue advocacy as a constitutional matter, as Plaintiff suggests:
Id. at 191-92, 124 S.Ct. 619. Buckley's division between express advocacy and issue advocacy emerged from the Supreme Court's reading of a particular statute — one notably different from BCRA — in order to avoid constitutional defects with the statute. McConnell further explains how the Buckley Court derived the express advocacy test and applied it to the FECA disclosures requirements, demonstrating that the Supreme Court did not fashion the test as a general constitutional rule:
McConnell, 540 U.S. at 190-91, 124 S.Ct. 619 (quoting Buckley, 424 U.S. at 40-44, 77-78, 80, 96 S.Ct. 612) (citations omitted) (alterations in original). The line Buckley drew emerged from the particular statute the Supreme Court was considering — a statute that suffered from serious vagueness problems, unlike BCRA — not from a general constitutional command.
Plaintiff cites the caveat in McConnell's conclusion that the express advocacy line was the product of statutory construction, see id. at 192, 124 S.Ct. 619 ("[W]e nowhere suggested that a statute that was neither vague nor overbroad would be required to toe the same express advocacy line"), to argue that this is such a case that would require the statutory construction "to toe the same express advocacy line." Pl.'s Reply at 7-8. While Plaintiff does not claim that BCRA presents the vagueness problems addressed with respect to FECA, see id. at 6, Plaintiff asserts that
In addition, Plaintiff cites Buckley to show that disclosure requirements are subjected to exacting scrutiny. See Pl.'s Reply at 2. This proposition is unremarkable, and, indeed, this is the standard that Citizens United applied. See Citizens United, 558 U.S. at 366-67, 130 S.Ct. 876 (quoting Buckley, 424 U.S. at 64, 66, 96 S.Ct. 612) ("The Court has subjected these requirements to `exacting scrutiny,' which requires a `substantial relation' between the disclosure requirement and a `sufficiently important' governmental interest."); see also id. at 369, 130 S.Ct. 876. Accordingly, applying this unremarkable proposition yields the same outcome as in Citizens United: BCRA section 201's disclosure requirements satisfy the requirements of exacting scrutiny.
In sum, Buckley does not support the result that Plaintiff seeks. First, the state interests discussed by Buckley supporting disclosures in the context of FECA also support disclosures in the context of BCRA. Second, Buckley's introduction of the express advocacy test was limited to the predecessor statute before the Supreme Court at the time. And, third, while Buckley does stand for the requirement that exacting scrutiny must be applied to disclosure requirements, Citizens United applied exactly that standard — with a result that contradicts what Plaintiff is seeking in this case.
Four years after McConnell, the Supreme Court considered an as-applied challenge to BCRA section 203, which barred corporations from expenditures on electioneering communications, in WRTL II. 551 U.S. at 455-56, 127 S.Ct. 2652. The Supreme Court concluded that "the interests held to justify restricting corporate campaign speech or its functional equivalent do not justify restricting issue advocacy," and concluded that the expenditure bar in BCRA section 203 was unconstitutional as applied to the advertisements at issue in that action. Id. at 457, 127 S.Ct. 2652. While Plaintiff cites WRTL II "as strong authority for the continued vitality of Buckley's separation of issue speech from express advocacy," Pl.'s Mot. at 14, WRTL II does not suggest that distinction is relevant with respect to disclosures — regardless of the asserted vitality of that distinction with respect to expenditures.
Plaintiff's attempt to apply the reasoning of WRTL II to disclosure requirements fails. WRTL II was an as-applied challenge to the regulation of expenditures pursuant to BCRA section 203 while only the disclosure requirements in section 201 are challenged in this action. Plaintiff acknowledges as much. See id.; Pl.'s Reply at 5. Indeed, the Plaintiff's argument with respect to WRTL II is precisely the argument rejected in Citizens United. See Citizens United, 558 U.S. at 368-69, 130 S.Ct. 876 ("The principal opinion in WRTL [II] limited 2 U.S.C. § 441b's restrictions on independent expenditures to express advocacy and its functional equivalent. Citizens United seeks to import a similar distinction into BCRA's disclosure requirements. We reject this contention."). As explained above, Citizens United is binding, and it forecloses the application of the restrictions applied in WRTL II to this case. In sum, WRTL II provides no authority to support importing the express advocacy (or functional equivalent) test to the disclosure requirements of BCRA section 201.
Plaintiff's claim is squarely foreclosed by Citizens United, in which the Supreme Court refused to import the distinction between express advocacy and its functional equivalent and issue advocacy to the disclosure requirements of BCRA section 201. In all relevant ways, the advertisement that Independence Institutes proposes to run is similar to the Hillary advertisements considered by the Supreme Court in Citizens United. That Independence Institute is subject to section 501(c)(3) of the tax code, while Citizens United is subject to section 501(c)(4), does not provide a basis for a different result. Neither does the fact that the Hillary advertisements were arguably pejorative while Plaintiff's advertisement is, on its face, neither complimentary nor pejorative with respect to any candidate. Just as Citizens United's as-applied challenge to the disclosure requirements of section 201 failed, so too does Plaintiff's as-applied challenge to those same disclosure requirements. Moreover, the other precedent that Plaintiff seeks to enlist in its cause is either inapposite or, upon examination, actually supportive of the application of the disclosure requirements of BCRA in these circumstances.
In an exercise of its discretion, the Court finds that holding oral argument in this action would not be of assistance in rendering a decision. See LCvR 7(f). Moreover, holding a hearing would not be consistent with the Court's commitment to expediting these proceedings in light of the timing of the upcoming elections.
Compl. ¶ 35.
Barland, 751 F.3d at 836 (citations omitted). Accordingly, the Seventh Circuit agrees that the "express-advocacy limitation" does not apply to the disclosure provisions challenged in this action.
