Alliance For Open Soc'y Int'l Inc. v. United States Agency For Int'l Dev.

• Decision Date: 06 July 2011
• Docket Number: Docket No. 08–4917–CV.
• Citation: 651 F.3d 218
• Parties: ALLIANCE FOR OPEN SOCIETY INTERNATIONAL, INC., Pathfinder International, Global Health Council, Interaction, Plaintiffs–Appellees,Open Society Institute, Plaintiff,v.UNITED STATES AGENCY FOR INTERNATIONAL DEVELOPMENT, Rajiv Shah,* in his official capacity as Administrator of the U.S. Agency for International Development, and his successors, United States Centers for Disease Control and Prevention, Thomas R. Frieden, in his official capacity as Director of the U.S. Centers for Disease Control and Prevention, and his successors, United States Department of Health and Human Services, Kathleen Sebelius, in her official capacity as Secretary of the U.S. Department of Health and Human Services, and her successors, Defendants–Appellants.**
• Court: U.S. Court of Appeals — Second Circuit

651 F.3d 218

ALLIANCE FOR OPEN SOCIETY INTERNATIONAL, INC., Pathfinder International, Global Health Council, Interaction, Plaintiffs–Appellees,Open Society Institute, Plaintiff,

v.UNITED STATES AGENCY FOR INTERNATIONAL DEVELOPMENT, Rajiv Shah,* in his official capacity as Administrator of the U.S. Agency for International Development, and his successors, United States Centers for Disease Control and Prevention, Thomas R. Frieden, in his official capacity as Director of the U.S. Centers for Disease Control and Prevention, and his successors, United States Department of Health and Human Services, Kathleen Sebelius, in her official capacity as Secretary of the U.S. Department of Health and Human Services, and her successors, Defendants–Appellants.**

Docket No. 08–4917–CV.

United States Court of Appeals, Second Circuit.

Argued: Dec. 9, 2010.Decided: July 6, 2011.

Rebekah Diller, Brennan Center for Justice at NYU School of Law, New York, NY (Laura K. Abel, Alicia L. Bannon, David S. Udell, Brennan Center for Justice at NYU School of Law, New York, NY; David W. Bowker, Sue–Yun Ahn, Wilmer Cutler Pickering Hale and Dorr LLP, Washington, D.C.; Jason D. Hirsch, Wilmer Cutler Pickering Hale and Dorr LLP, New York, NY, on the brief), for Plaintiffs–Appellees.Benjamin H. Torrance, Assistant United States Attorney for the Southern District of New York (David S. Jones, Assistant United States Attorney, of counsel; Preet Bharara, United States Attorney, on the brief), for Defendants–Appellants.Lenora M. Lapidus, Women's Rights Project, American Civil Liberties Union, New York, NY (Mie Lewis, Women's Rights Project, American Civil Liberties Union, New York, NY; Arthur N. Eisenberg, Alexis Karterton, New York Civil Liberties Union, New York, NY; James Esseks, Rose Saxe, LGBT and AIDS Project, American Civil Liberties Union, New York, NY, on the brief), for Amici Curiae American Humanist Association and 24 Other Public Health and Human Rights Organizations and Experts.Lawrence S. Lustberg (Eileen M. Connor, on the brief), Gibbons P.C., Newark, NJ, for Amicus Curiae Independent Sector.Before: STRAUB, POOLER, and B.D. PARKER, Circuit Judges.Judge STRAUB dissents in a separate opinion.B.D. PARKER, JR., Circuit Judge:

Defendants–Appellants the U.S. Agency for International Development (“USAID”), the U.S. Department of Health and Human Services (“HHS”), and the U.S. Centers for Disease Control and Prevention (“CDC”) (collectively, the “Agencies” or “Defendants”) appeal from preliminary injunctions entered by the United States District Court for the Southern District of New York (Marrero, J.). The district court enjoined the Agencies from enforcing 22 U.S.C. § 7631(f), a provision of the United States Leadership Against HIV/AIDS, Tuberculosis, and Malaria Act of 2003 (“Leadership Act”), 22 U.S.C. § 7601 et seq., against Plaintiffs–Appellees Alliance for Open Society International, Inc. (“AOSI”), Pathfinder International (“Pathfinder”), Global Health Council (“GHC”), and InterAction. These are non-governmental organizations (“NGOs”) engaged in the international fight against HIV/AIDS that receive funding under the Act.

Section 7631(f) of the Leadership Act provides that “[n]o funds made available to carry out this Act ... may be used to provide assistance to any group or organization that does not have a policy explicitly opposing prostitution.” This provision, as construed and implemented by the Agencies, requires NGOs, as a condition of receiving Leadership Act funds, to adopt a policy explicitly opposing prostitution, and prohibits recipients from engaging in any activities that are “inconsistent” with an anti-prostitution stance. Certain other recipients of Leadership Act funds, such as the World Health Organization, are not bound by this restriction.

As explained below, we conclude that § 7631(f), as implemented by the Agencies, falls well beyond what the Supreme Court and this Court have upheld as permissible conditions on the receipt of government funds. Section 7631(f) does not merely require recipients of Leadership Act funds to refrain from certain conduct, but goes substantially further and compels recipients to espouse the government's viewpoint. See 45 C.F.R. § 89.1. Consequently, we agree with the district court that Plaintiffs have demonstrated a likelihood of success on the merits. Finding no abuse of discretion by the district court, we affirm.

BACKGROUND

The Leadership Act

In 2003, Congress passed the Leadership Act “to strengthen and enhance United States leadership and the effectiveness of the United States response to the HIV/AIDS, tuberculosis, and malaria pandemics.” 22 U.S.C. § 7603 (Supp. III 2009).¹ The Act designates several avenues through which this international campaign is to be run, including “5–year, global strategies”; the development of vaccines and treatments; and “public-private” partnerships between federal agencies and NGOs, which Congress recognized “have proven effective in combating the HIV/AIDS pandemic.” §§ 7601(18), 7603.

The Act reflects Congress's concern with the social, cultural, and behavioral causes of HIV/AIDS. See § 7601(15). Section 7601(23), one of forty-one congressional “findings” set forth in § 7601, addresses prostitution: “Prostitution and other sexual victimization are degrading to women and children and it should be the policy of the United States to eradicate such practices. The sex industry, the trafficking of individuals into such industry, and sexual violence are additional causes of and factors in the spread of the HIV/AIDS epidemic.”

Congress imposed two prostitution-related conditions on Leadership Act funding. First, it specified that no funds made available to carry out the Act may be used to promote or advocate the legalization or practice of prostitution or sex trafficking. § 7631(e). Second, it imposed a Policy Requirement, which specifies that:

No funds made available to carry out this Act ... may be used to provide assistance to any group or organization that does not have a policy explicitly opposing prostitution and sex trafficking, except that this subsection shall not apply to the Global Fund to Fight AIDS, Tuberculosis and Malaria, the World Health Organization, the International AIDS Vaccine Initiative or to any United Nations agency.

§ 7631(f). This litigation involves only the Policy Requirement. Plaintiffs do not challenge the Requirement's “sex trafficking” component.

Defendants' Initial Implementation of the Policy Requirement

The defendant Agencies implement the Leadership Act by, in part, funding U.S.-based NGOs involved in the international fight against HIV/AIDS. AOSI and Pathfinder are two such organizations. AOSI runs a program in Central Asia that aims to prevent the spread of HIV/AIDS by reducing injection drug use, while Pathfinder works to stem the spread of HIV/AIDS by providing family planning and reproductive health services in more than twenty countries. Both receive funding from sources other than the Agencies and neither supports prostitution. But their work does involve engaging, educating, and assisting groups, such as prostitutes, that are vulnerable to HIV/AIDS, as well as advocating approaches and discussing strategies for fighting HIV/AIDS among prostitutes at, among other places, policy conferences and forums.

After the Leadership Act was enacted, the Department of Justice's Office of Legal Counsel (“OLC”) warned that applying the Policy Requirement to U.S.-based organizations would be unconstitutional. Heeding that warning, Defendants initially refrained from enforcing it against U.S.-based NGOs. OLC subsequently changed course and withdrew what it characterized as its prior “tentative advice,” asserting that “there are reasonable arguments to support the[ ] constitutionality” of applying the Policy Requirement to U.S.-based organizations, and, starting in mid–2005, the Agencies began applying the Requirement to U.S.-based grantees. Specifically, USAID issued a directive requiring that U.S.-based organizations, as a condition of receiving funding under the Act, “must have a policy explicitly opposing prostitution.” Defendants also construed the Policy Requirement as prohibiting grantees from engaging in activities that were inconsistent with a policy opposing prostitution. In an effort to remain eligible for Leadership Act funding, both AOSI and Pathfinder adopted policy statements. Pathfinder's, for example, stated that it “opposes prostitution and sex trafficking because of the harm they cause primarily to women.”

The District Court's First Decision

In 2005, AOSI and Pathfinder sued the Agencies, contending that conditioning Leadership Act funding on the affirmative adoption of a policy opposing prostitution violated the First Amendment by compelling grantees to adopt and voice the government's viewpoint on prostitution, and by restricting grantees from engaging in privately funded expression that the Agencies might deem insufficiently opposed to prostitution. They also asserted that the Policy Requirement was unconstitutionally vague with respect to what sorts of prostitution-related activity and expression were, in fact, restricted.

The district court granted AOSI and Pathfinder preliminary injunctive relief. Alliance for Open Soc'y Int'l, Inc. v. U.S. Agency for Int'l Dev., 430 F.Supp.2d 222 (S.D.N.Y.2006) (“ Alliance I ”). The court engaged in a thorough analysis of the Supreme Court's “unconstitutional conditions” jurisprudence—focusing, in particular, on Regan v. Taxation With Representation, 461 U.S. 540, 103 S.Ct. 1997, 76 L.Ed.2d 129 (1983), FCC v. League of Women Voters of California, 468 U.S. 364, 104 S.Ct. 3106, 82 L.Ed.2d 278 (1984), and Rust v. Sullivan, 500 U.S. 173, 111 S.Ct. 1759, 114 L.Ed.2d 233 (1991). The court first concluded that, because the Policy Requirement substantially impaired First Amendment protected activity conducted by private entities with private funds as a...