Colorado Right to Life Committee, Inc. v. Coffman, 05-1519.

Decision Date21 August 2007
Docket NumberNo. 05-1538.,No. 05-1519.,05-1519.,05-1538.
Citation498 F.3d 1137
PartiesCOLORADO RIGHT TO LIFE COMMITTEE, INC., Plaintiff-Appellee/Cross-Appellant, v. Mike COFFMAN,<SMALL><SUP>*</SUP></SMALL> in his official capacity as Colorado Secretary of State, Defendant-Appellant/Cross-Appellee. Colorado Common Cause and League of Women Voters of Colorado. Amici Curiae in support of Defendant-Appellant/Cross-Appellee.
CourtU.S. Court of Appeals — Tenth Circuit

James Bopp, Jr. (with Richard E. Coleson on the briefs), Bopp, Coleson & Bostrom, Terre Haute, IN, for Plaintiff-Appellee/Cross-Appellant.

Martha M. Tierney, Kelly/Haglund/Garnsey + Kahn LLC, Denver, CO, filed a brief on behalf of Amici Curiae.

Before HENRY, ANDERSON, and HOLMES, Circuit Judges.

HENRY, Circuit Judge.

Article XXVIII of the Colorado Constitution is a citizen-passed campaign finance reform amendment designed to limit the influence of certain types of corporations' general funds on state elections. Colorado Right to Life Committee (CRLC), a non-profit ideological corporation, sought declaratory and injunctive relief against the Colorado Secretary of State, arguing that Article XXVIII contained provisions that interfered with its traditional communications and activities and, thereby, violated its First and Fourteenth Amendment rights under the United States Constitution. The district court granted summary judgment in part to CRLC and in part to the Secretary. The Secretary now appeals, and CRLC cross-appeals.

We have jurisdiction pursuant to 28 U.S.C. § 1291 and affirm. Specifically, we hold that the challenged sections of Article XXVIII regulating corporate expenditures and electioneering communications are unconstitutional as applied to CRLC because CRLC meets Supreme Court-approved exemption requirements for a voluntary ideological corporation that seeks to engage in political speech. See FEC v. Mass. Citizens for Life, 479 U.S. 238, 259-60, 107 S.Ct. 616, 93 L.Ed.2d 539 (1986) (plurality opinion) ("MCFL"). In addition, we conclude that Article XXVIII's definition of a political committee is unconstitutional as applied to CRLC because it fails to incorporate Buckley v. Valeo's "major purpose" test. 424 U.S. 1, 79, 96 S.Ct. 612, 46 L.Ed.2d 659 (1976). Finally, we decline CRLC's invitation to reconsider its remaining facial challenges to various sections of Article XXVIII.

I. BACKGROUND
A. Article XXVIII of the Colorado Constitution

In November 2002, Colorado voters, seeking to limit the influence of money on state elections, passed Amendment 27.1 Amendment 27 amended Article XXVIII of the Colorado Constitution to prohibit corporations from using their general funds to make contributions, expenditures, and electioneering communications. Section 3(4)(a) of Article XXVIII reads:

It shall be unlawful for a corporation or labor organization to make contributions to a candidate committee or a political party, and to make expenditures expressly advocating the election or defeat of a candidate; except that a corporation or labor organization may establish a political committee or small donor committee which may accept contributions or dues from employees, officeholders, shareholders, or members.2

Section 6(2) further reads:

Notwithstanding any section to the contrary, it shall be unlawful for a corporation or labor organization to provide funding for an electioneering communication; except that any political committee or small donor committee established by such corporation or labor organization may provide funding for an electioneering communication.3

However, following the United States Supreme Court's teachings in MCFL, Article XXVIII and Secretary of State Rule 4.13 created an exception to the prohibition for corporations that meet three requirements. Section 3(4)(b) provides:

The prohibition contained in paragraph (a) of this subsection (4) shall not apply to a corporation that:

(I) Is formed for the purpose of promoting political ideas and cannot engage in business activities; and

(II) Has no shareholders or other persons with a claim on its assets or income; and

(III) Was not established by and does not accept contributions from business corporations or labor organizations.

Colo. Const. art. XXVIII, § 3(4)(b). Similarly, Rule 4.13, the Secretary of State Rules' exception to § 6(2) reads:

Article XXVIII § 6(2), concerning the prohibition against funding by corporations and labor organizations for electioneering communications, shall not apply to any corporation that:

a. Was formed for the purpose of promoting political ideas and cannot engage in business activities;

b. Has no shareholders with a claim on its assets or other income; and

c. Was not established by, and does not accept contributions from business corporations or labor organizations.

Colo. Sec. of State, Rules Concerning Campaign and Political Finance, Rule 4.13. We have labeled the exception established by § 3(4)(b) and Rule 4.13 the "MCFL exemption."

A corporation that meets these criteria may use its general corporate treasuries to make expenditures, contributions, and electioneering communications. However, the Secretary maintains that whether or not a corporation meets the MCFL exemption, it must still register as a political committee if it makes or accepts contributions or expenditures in excess of $200 to support or oppose the nomination or election of candidates. Colo. Const. art. XXVIII, § 2(12)(a) (defining "political committee" as "any person, other than a natural person, or any group of two or more persons, including natural persons that have accepted or made contributions or expenditures in excess of $200 to support or oppose the nomination or election of one or more candidates"); see id. § 7 (referring to disclosure requirements relevant to political committees and other groups, set forth in Colo.Rev.Stat. § 1-45-108 or any successor section).

Furthermore, if a nonprofit ideological corporation (or "any person") funds electioneering communications exceeding $1,000 per year from its general corporate treasuries, it too must file applicable reports. Section 6(1) of Article XXVIII details these requirements, while § 6(2) prohibits corporate funding of electioneering communications:

Any person who expends one thousand dollars or more per calendar year on electioneering communications shall submit reports to the secretary of state in accordance with the schedule currently set forth in [Colo.Rev.Stat. §] 1-45-108(2) . . ., or any successor section. Such reports shall include spending on such electioneering communications, and the name, and address, of any person that contributes more than two hundred and fifty dollars per year to such person described in this section for an electioneering communication. In the case where the person is a natural person, such reports shall also include the occupation and employer of such natural person. The last such report shall be filed thirty days after the applicable election. Notwithstanding any section to the contrary, it shall be unlawful for a corporation or labor organization to provide funding for an electioneering communication; except that any political committee or small donor committee established by such corporation or labor organization may provide funding for an electioneering communication.

Colo. Const. art. XXVIII, § 6.

At issue here is whether CRLC is subject to Article XXVIII's reporting requirements and whether §§ 3(4) (banning corporations from making expenditures that expressly advocate the election or defeat of a candidate), 6(2) (banning corporations from funding electioneering communications), and (2)(12) (defining political committee) of Article XXVIII are unconstitutional as applied to CRLC. We also discuss CRLC's contention that these provisions, along with § 2(7), are facially vague and overbroad.

B. Colorado Right to Life Committee

We first summarize the undisputed facts regarding CRLC, drawn largely from the district court's order. See Colo. Right to Life Comm., Inc. v. Davidson, 395 F.Supp.2d 1001, 1007-09 (D.Colo.2005). CRLC is a tax-exempt organization under 26 U.S.C. § 501(c)(4) and has a policy of not contributing to, accepting contributions from, or engaging in express advocacy regarding, political parties or candidates. Likewise, it is not associated with any political candidate, political party, or campaign committee, and is not aware of ever receiving any donations at the request of, or solicited by, a political candidate, a political party or elected official. It has several chapters throughout the State of Colorado. CRLC's policy is not to engage in express advocacy or make direct in-kind contributions.

CRLC's corporate organizational documents indicate that its purposes are to (1) promote reverence and respect for human life without regard to condition, quality, age, race, religion, creed, or color, whether born or unborn; and (2) educate the community regarding the dangers of abortion, euthanasia, infanticide, and compulsory sterilization as well as any legislation that would allow the debasement of or destroy the community's moral fiber; and (3) encourage a favorable, spiritual, physical, and cultural environment that would improve the quality of life consistent with these purposes. CRLC seeks to achieve these purposes by communicating with the public regarding such issues, providing information about elected officials, and encouraging Colorado citizens to communicate with their representatives on these issues.

CRLC was not established by a business corporation or labor union, and has no shareholders or otherwise affiliated persons who would have a claim on its assets and earnings. CRLC has two types of members: (1) supporting members, who include anyone who donates money to the organization, unless that person asks not to be a...

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