740 F.3d 176 (D.C. Cir. 2014), 12-5379, Autor v. Pritzker

Docket Nº:12-5379.
Citation:740 F.3d 176
Opinion Judge:TATEL, Circuit Judge:
Party Name:Erik O. AUTOR, et al., Appellants v. Penny Sue PRITZKER, In Her Official Capacity as Secretary of Commerce, et al., Appellees.
Attorney:Charles A. Rothfeld argued the cause and filed the briefs for appellants. With him on the briefs was Joseph P. Minta. Michael S. Raab, Attorney, U.S. Department of Justice, argued the cause for appellees. With him on the brief were Stuart F. Delery, Acting Assistant Attorney General, Ronald C. Ma...
Judge Panel:Before: TATEL and BROWN, Circuit Judges, and EDWARDS, Senior Circuit Judge. Opinion for the Court filed by Circuit Judge TATEL.
Case Date:January 17, 2014
Court:United States Courts of Appeals, Court of Appeals for the District of Columbia Circuit
 
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740 F.3d 176 (D.C. Cir. 2014)

Erik O. AUTOR, et al., Appellants

v.

Penny Sue PRITZKER, In Her Official Capacity as Secretary of Commerce, et al., Appellees.

No. 12-5379.

United States Court of Appeals, District of Columbia Circuit.

January 17, 2014

Argued Oct. 25, 2013.

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Appeal from the United States District Court for the District of Columbia (No. 1:11-cv-01593).

Charles A. Rothfeld argued the cause and filed the briefs for appellants. With him on the briefs was Joseph P. Minta.

Michael S. Raab, Attorney, U.S. Department of Justice, argued the cause for appellees. With him on the brief were Stuart F. Delery, Acting Assistant Attorney General, Ronald C. Machen Jr., U.S. Attorney, Mark B. Stern and Daniel Tenny, Attorneys.

Before: TATEL and BROWN, Circuit Judges, and EDWARDS, Senior Circuit Judge.

Opinion for the Court filed by Circuit Judge TATEL.

OPINION

TATEL, Circuit Judge:

President Obama, seeking to reduce the " culture of special interest access," directed executive agency heads to bar federally registered lobbyists from serving on advisory committees. Appellants, federally registered lobbyists wishing appointment to one type of advisory committee— Industry Trade Advisory Committees (ITACs)— challenge the constitutionality of the presidential ban. Because the ban requires Appellants to limit their exercise of a constitutional

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right— in this case, the First Amendment right to petition government— in order to qualify for a governmental benefit— in this case, ITAC membership— we reverse the district court's premature dismissal of the complaint and remand for that court to determine in the first instance whether the government's interest in excluding federally registered lobbyists from ITACs outweighs any impingement on Appellants' constitutional rights.

I.

Created by the Trade Act of 1974, which requires the President to " seek information and advice from representative elements of the private sector ... with respect to" trade policy, 19 U.S.C. § 2155(a)(1), ITACs play a significant role in shaping international trade agreements. See id. § 2155(c)(2). The sixteen industry-specific ITACs run the gamut of industrial interests from Aerospace Equipment to Consumer Goods to Service and Financial Industries. See International Trade Administration, List of Industry Trade Advisory Committees, available at www. ita. doc. gov/ itac/ committees/ index. asp (last visited Jan. 10, 2014). In addition to meeting " at the call of the United States Trade Representative," 19 U.S.C. § 2155(d), ITACs prepare reports for the President, Congress, and the Trade Representative on whether proposed trade agreements provide for " equity and reciprocity within" the committees' sector, id. § 2155(e)(1), (3). Although ITAC advice is non-binding, the Act requires the Trade Representative to " inform the advisory committees of significant departures from such advice or recommendations made." Id. § 2155(i)(2).

Unlike many advisory committees, ITACs exist for the very purpose of reflecting the viewpoints of private industry. According to the Trade Act, the " committees shall, insofar as is practicable, be representative of all industry, labor, agricultural, or service interests." Id. § 2155(c)(2). Applicants for ITAC membership must be sponsored by a firm or organization engaged in trade or trade policy. See Request for Nominations for the Industry Trade Advisory Committees (ITACs), 75 Fed.Reg. 24,584, 24,585 (May 5, 2010). ITAC members serve in a " representative capacity presenting the views and interests of a U.S. entity or U.S. organization." Id. It should thus come as no surprise that the Aerospace Equipment ITAC includes representatives of Boeing, Pratt & Whitney, Gulfstream, General Electric, Lockheed Martin, and Bell Aerospace. Likewise, the Energy and Energy Services ITAC includes representatives of Halliburton, Chevron, General Electric, the National Mining Association, and the Nuclear Energy Institute. See International Trade Administration, List of Industry Trade Advisory Committees, available at www. ita. doc. gov/ itac/ committees/ index. asp (last visited Jan. 10, 2014).

Although Congress created ITACs to represent the views of the private sector, President Obama directed " the heads of executive departments and agencies not to make any new appointments or reappointments of federally registered lobbyists to advisory committees." Presidential Memorandum, Lobbyists on Agency Boards and Commissions, 75 Fed.Reg. 35,955 (June 18, 2010). In so directing, the President sought to further his commitment to change " the culture of special-interest access" that is furthered by lobbyists' " service in privileged positions within the executive branch." Id. " My administration," the President explained, " is committed to reducing the undue influence of special interests that for too long has shaped the national agenda and drowned out the voices of ordinary Americans." Id. Pursuant

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to the President's directive, and setting the stage for this litigation, the Commerce Secretary and the Trade Representative prohibit federally registered lobbyists from serving on ITACs. See Request for Nominations for the Industry Trade Advisory Committees (ITACs), 75 Fed.Reg. at 24,585.

Contrary to popular belief, only certain lobbyists are required to be federally registered. The Lobbying Disclosure Act of 1995 (LDA) requires that lobbyists register if they (1) are employed by a client for compensation, (2) have made more than one lobbying contact on behalf of such client, and (3) have spent at least twenty percent of their time for that client working on lobbying activities during a three-month period. 2 U.S.C. § 1602(10). In other words, lobbyists have no obligation to register if they limit their lobbying activities to at most twenty percent of their time working for any particular client.

Appellants, six federally registered lobbyists wishing to serve on ITACs, sued to enjoin the ban. Relying on Perry v. Sindermann, 408 U.S. 593, 92 S.Ct. 2694, 33 L.Ed.2d 570 (1972), which limits the government's power to condition governmental benefits on recipients' relinquishment of constitutionally protected rights, Appellants alleged that the ban violates the First Amendment and the equal protection guarantee of the Fifth Amendment by " denying the benefit of committee service to individuals whose exercise of the right to petition triggers the LDA's registration requirement." Complaint ¶ 44.

The district court dismissed the complaint pursuant to Federal Rule of Civil Procedure 12(b)(6). The court first found Appellants' claims foreclosed by Minnesota State Board for Community Colleges v. Knight, 465 U.S. 271, 104 S.Ct. 1058, 79 L.Ed.2d 299 (1984), in which the Supreme Court held that " the Constitution does not grant members of the public any particular right to be heard by public bodies making policy decisions." Autor v. Blank, 892 F.Supp.2d 264, 273-74 (D.D.C.2012) (citing Knight, 465 U.S. at 283, 104 S.Ct. 1058). The court went on to conclude that even if Knight left open Appellants' unconstitutional conditions claim, the complaint nonetheless failed to establish both " that service on an ITAC is a valuable government benefit," id. at 275, 104 S.Ct. 1058, and that Appellants were denied this benefit " on a basis that infringes upon their constitutionally protected rights," id. at 268, 104 S.Ct. 1058. Finding that the lobbyist ban implicated no fundamental rights, the court also rejected Appellants' Fifth Amendment equal protection claim. See id. at 282-84, 104 S.Ct. 1058.

On appeal, Appellants challenge the dismissal of both their First Amendment and Fifth Amendment claims. We review Rule 12(b)(6) dismissals de novo, see St. Marks Place Housing Co., Inc. v. U.S. Department of Housing & Urban Development, 610 F.3d 75, 79 (D.C.Cir.2010), " accept[ing] as true all of the factual allegations contained in the complaint and draw[ing] all inferences in favor of the nonmoving party," City of Harper Woods Employees' Retirement System v. Olver, 589 F.3d 1292, 1298 (D.C.Cir.2009).

II.

At the outset, we think it important to put the issue before us in its proper context. Reading the government's brief and listening to oral argument, during which counsel asserted that the Constitution imposes " very, very few restrictions" on the " President's [power to] choos[e] [his] advisors," Oral Arg. Tr. 16, one might get the impression that this case is about the President's ability to select his Chief of Staff or White House Counsel. Nothing could be further from the truth. The question before

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us concerns only the President's choice of individuals to serve on congressionally created advisory committees— more specifically, Industry Trade Advisory Committees.

According to Appellants, we may resolve this case through a straightforward application of Perry 's " unconstitutional conditions" doctrine. See Perry, 408 U.S. at 597, 92 S.Ct. 2694. If, as they allege, ITAC service qualifies as a governmental benefit and the registered-lobbyist ban requires them to curtail their right to petition government to receive this benefit, then, they contend, the government has unconstitutionally burdened their exercise of this right. Before addressing this question, however, we must consider the government's antecedent argument, embraced by the district court, that the Supreme Court's recognition in Knight of the government's freedom to choose its advisors forecloses application of the unconstitutional conditions doctrine here.

Knight concerned a Minnesota law requiring public employers to " meet and confer" with their professional employees on employment— related policy issues. Knight, 465 U.S. at 274, 104 S.Ct. 1058. But if an employee bargaining unit had an exclusive bargaining representative, i.e., a union, the law prohibited the employer from " meeting and...

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