Californians for Fair Representation-No On 77 v. Superior Court of Sacramento County, C051100 (CA 3/29/2006)
| Decision Date | 29 March 2006 |
| Docket Number | C051100 |
| Parties | CALIFORNIANS FOR FAIR REPRESENTATION-NO ON 77 et al., Petitioners, v. THE SUPERIOR COURT OF SACRAMENTO COUNTY, Respondent; ARNOLD SCHWARZENEGGER, as Governor, etc., et al., Real Parties in Interest. |
| Court | California Supreme Court |
Appeal from the Super. Ct. No. 05AS04516.
Original Proceeding in mandate. Thomas J. Cecil, Judge. Writ denied.
Olson, Hagel & Fishburn, Deborah B. Caplan, Lance H. Olson and Richard C. Miadich for Petitioners.
No appearance for Respondent.
Bell, McAndrews & Hiltachk, Charles H. Bell, Thomas W. Hiltachk and Jimmie E. Johnson for Real Parties in Interest.
Just prior to the special election of November 8, 2005, petitioners Californians for Fair Representation—No on 77 (hereafter CFR—No on 77) and Theresa Faye Jang-Hefner (collectively, petitioners) petitioned this court for a peremptory writ of mandate, prohibition or other extraordinary relief. They sought to compel respondent the Superior Court of Sacramento County to vacate its order denying a temporary restraining order and preliminary injunction to require real parties in interest, Governor Arnold Schwarzenegger, Governor Schwarzenegger's California Recovery Team (hereafter CRT), Redistrict California—Yes on 77 (hereafter Redistrict—Yes on 77) and Steve Poizner (collectively, real parties in interest), to comply with 24-hour disclosure requirements for contributions and independent expenditures imposed by the Political Reform Act of 1974 (PRA) (Gov. Code, § 81000 et seq.).1
After real parties in interest voluntarily complied with the disclosure requirements, this court issued an alternative writ of mandate on November 4, 2005, but denied the request for immediate relief as moot. Petitioners contend real parties in interest's initial refusal to report as contributions or independent expenditures the million of dollars spent on radio and television advertising in support of Propositions 74, 75, 76 and 77 violated the PRA. Real parties in interest contend the case is moot because the reports have been filed and the issue is not one likely to evade review. Further, they contend there was no basis for a preliminary injunction as there was no irreparable injury and petitioners had no likelihood of prevailing on the merits.
We conclude that although the issue is technically moot, we shall exercise our discretion to decide it because it is an important issue of public interest, likely to recur and evade appellate review. We further conclude that the expenditures admittedly made by CRT meet the statutory definition of independent expenditures and should have been reported on a 24-hour basis during the 90 days before the election.
Many of the parties in this case are committees as defined by the PRA, so we begin by identifying the various types of committees. A committee is one or more persons who directly or indirectly receives contributions of $1,000 or more in a calendar year, makes independent expenditures of $1,000 or more in a calendar year, or makes contributions of $10,000 or more in a calendar year to or at the behest of candidates or committees. (§ 82013.) A controlled committee is a committee controlled directly or indirectly by a candidate or state measure proponent. (§ 82016, subd. (a).) A candidate or state measure proponent controls a committee if he or she has a significant influence on the actions or decisions of the committee. (Ibid.)
Committees are divided into two groups based on the purpose for which the committee is formed. A primarily formed committee is formed or exists to support or oppose one or more candidates or one or more measures being voted upon in the same election. (§ 82047.5.) A general purpose committee generally is formed or exists to support or oppose candidates or measures in several different elections. (§ 82027.5, subd. (a).)
Petitioner CFR—No on 77 is a committee primarily formed to oppose Proposition 77 in the November 2005 special election.2 Petitioner Theresa Faye Jang-Hefner is a registered California voter.
Real party in interest Arnold Schwarzenegger is the Governor of California and a candidate for reelection to that office; he controls real party in interest CRT, a general purpose committee. Real party in interest Redistrict—Yes on 77 is a committee primarily formed to support Proposition 77 and is controlled by real party in interest Steve Poizner, a candidate for State Insurance Commissioner.
On October 7, 2005, petitioners filed a complaint for temporary and permanent injunction against real parties in interest, challenging the legality of contributions totaling $1,750,000 made by Governor Schwarzenegger and CRT to Redistrict—Yes on 77. They also filed an ex parte application for a temporary restraining order.
In a preliminary opposition, real parties in interest argued there was no harm justifying an injunction because the contributions had been returned. They further argued that any limitation on the amount an individual could contribute to a ballot measure committee was unconstitutional.
At a hearing on the application for a temporary restraining order, real parties in interest provided documentation that the contributions at issue had been refunded. In response to petitioners' argument that CRT had made in-kind contributions to Redistrict—Yes on 77, the treasurer of CRT declared that CRT made expenditures in support of Proposition 77, but that these expenditures were not "at the behest of" Redistrict—Yes on 77 or Poizner. The trial court denied the application for a temporary restraining order.
Petitioners then turned their sights on the millions of dollars CRT had spent on radio and television advertising in support of Propositions 74, 75, 76 and 77. They asserted these expenditures were "at the behest" of Redistrict—Yes on 77 and therefore should have been reported as contributions to Redistrict—Yes on 77. In support of their argument, petitioners pointed to the connections between Redistrict—Yes on 77 and the Governor. The full legal name of Redistrict—Yes on 77 included "with major funding provided by Arnold Schwarzenegger and Steve Poizner for Insurance Commissioner." Governor Schwarzenegger publicly announced that Poizner would head the Yes on Proposition 77 campaign. Governor Schwarzenegger and Poizner engaged in joint fundraising for Redistrict—Yes on 77.
Petitioners argued the expenditures for advertising were either contributions to Redistrict—Yes on 77 or, if not made "at the behest" of Redistrict—Yes on 77, independent expenditures. In either case, the sums had to be publicly reported on a 24-hour basis in the final weeks before the election. Neither CRT nor Redistrict—Yes on 77 had reported the sums and were therefore in violation of the PRA.
Real parties in interest argued petitioners had no evidence that the expenditures for advertising in support of Proposition 77 were made "at the behest" of Redistrict—Yes on 77, so there were no illegal contributions and the motion for a preliminary injunction had to be denied.
Petitioners then filed a first amended complaint for temporary and permanent injunction. They alleged CRT had made expenditures in excess of $700,000 in support of Proposition 77 and that these expenditures were in-kind contributions to Redistrict—Yes on 77. They sought to enjoin these excessive and illegal contributions and to require Redistrict—Yes on 77 to report these contributions on a 24-hour basis as required by the PRA. Alternatively, if the expenditures were not contributions to Redistrict—Yes on 77, they were independent expenditures by CRT and CRT was required to report them on a 24-hour basis under the PRA.
Once again, petitioners sought a temporary restraining order. They sought to enjoin real parties in interest from refusing and failing to comply with the disclosure requirements of the PRA.
The trial court denied the second application for a temporary restraining order. By stipulation of the parties, the ruling also resulted in denial of the request for a preliminary injunction. The issue remaining before the court was whether CRT was required to report expenditures on a 24-hour basis pursuant to the PRA. The trial court found the law "less than clear as to the precise reporting requirements that apply to the expenditures at issue." However, even if petitioners were correct as to the reporting requirements, there was no irreparable harm. The public had abundant information about the source and amount of money being used to support the propositions and knew the Governor was the major proponent of and the major donor to Proposition 77.
Just days before the November 8, 2005 special election, petitioners petitioned this court for extraordinary relief to compel real parties in interest to comply with the 24-hour disclosure requirements of the PRA. A few days later, real parties in interest submitted an opposition, reporting that CRT had begun voluntarily filing electronic reporting of its expenditures in support of Propositions 74, 75, 76 and 77, and would continue to do so on a daily basis until the election. This court denied the request for immediate relief as moot, but issued an alternative writ of mandate.
In their petition, petitioners urge that even if their request for immediate relief is denied, this court should issue an alternative writ and schedule the matter for hearing so the disclosure issues can be resolved before the next election.
Real parties in interest contend this case is now moot because they voluntarily made the disclosures that petitioners sought. They further contend that the issue is not one that is likely to evade review. Since the reports at issue have to be filed on a 24-hour basis for the 90 days preceding an election, they contend a challenger has 90 days to file suit and the issue could be resolved before the election.
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