Iowa Right To Life Comm., Inc. v. Tooker

• Decision Date: 30 December 2011
• Docket Number: No. 11–1068.,11–1068.
• Citation: 808 N.W.2d 417
• Parties: IOWA RIGHT TO LIFE COMMITTEE, INC., Plaintiff, v. Megan TOOKER, In Her Official Capacity as Iowa Ethics and Campaign Disclosure Board Executive Director; James Albert, John Walsh, Patricia Harper, Gerald Sullivan, Saima Zafar, and Carole Tillotson, In Their Official Capacities as Iowa Ethics and Campaign Disclosure Board Members, Defendants.
• Court: Iowa Supreme Court

808 N.W.2d 417

IOWA RIGHT TO LIFE COMMITTEE, INC., Plaintiff,

v.Megan TOOKER, In Her Official Capacity as Iowa Ethics and Campaign Disclosure Board Executive Director; James Albert, John Walsh, Patricia Harper, Gerald Sullivan, Saima Zafar, and Carole Tillotson, In Their Official Capacities as Iowa Ethics and Campaign Disclosure Board Members, Defendants.

No. 11–1068.

Supreme Court of Iowa.

Dec. 30, 2011.

Sean P. Moore, Brian P. Rickert, and Adam C. Gregg of Brown, Winick, Graves, Gross, Baskerville & Schoenebaum, P.L.C., Des Moines, James Bopp, Jr., Richard E. Coleson, and Kaylan L. Phillips of Bopp, Coleson & Bostrom, Terre Haute, Indiana, for plaintiff.

Thomas J. Miller, Attorney General, Jeffrey S. Thompson, Deputy Attorney General, and Meghan L. Gavin, Assistant Attorney General, Des Moines, for defendants.

MANSFIELD, Justice.

We have been asked to answer two certified questions of law in a federal case brought by Iowa Right to Life Committee, Inc. (IRTL) challenging the constitutionality of Iowa's campaign finance laws. The nub of the matter is whether a corporation must form a “political committee” under Iowa law if it wants to spend more than seven hundred fifty dollars advocating the election or defeat of Iowa candidates. Although Iowa's laws are not entirely clear (which explains the federal court's decision to certify), we conclude a corporation like IRTL may engage in express advocacy without forming a political committee.

The certified questions are as follows:

1. If a corporation that has not previously registered as a political committee makes independent expenditures aggregating over $750 in a calendar year, does that corporation become, by virtue of such expenditures: (1) an “independent expenditure committee,” as that term is defined in Iowa Admin. Code r. 351—4.1(1)(d); (2) a “political committee,” as that term is defined by Iowa Code § 68A.102(18); or both?

2. If a corporation that has not previously registered as a political committee and that “was originally organized for purposes other than engaging in election activities” makes independent expenditures aggregating over $750 in a calendar year, does that corporation become, by virtue of such expenditures, a “permanent organization” pursuant to Iowa Code § 68A.402(9)?

For the reasons discussed herein, we answer the questions as follows:

1. An independent expenditure committee.

2. No.

I. Factual Background and Procedural History.

According to its federal court complaint, IRTL is a nonprofit, nonstock Iowa corporation and the largest pro-life organization in Iowa. IRTL is exempt from federal taxes as a social welfare organization. 26 U.S.C. § 501(c)(4) (2006). IRTL alleges that its primary purpose is to “present factual information upon which individuals may make an informed decision about the various topics of fetal development, abortion, and alternatives to abortion, euthanasia, infanticide and prevention of cruelty to children.” IRTL's major purpose “is not and never will be the nomination or election of candidates.”

Nonetheless, in the wake of the U.S. Supreme Court's Citizens United decision holding that corporations have a First Amendment right to make independent expenditures expressly advocating the election or defeat of candidates,¹ IRTL seeks to make independent expenditures in Iowa to support candidates “who it believes will fight to protect issues that are important to its organization, such as protecting life.”

IRTL alleges that it is unconstitutionally chilled from making such expenditures “due to the burdens imposed by [Iowa's laws and regulations] ... and the potential civil and criminal penalties for violating the challenged provisions.” Among other things, IRTL alleges that if it made these kinds of expenditures, it would become a political committee (or PAC) under Iowa law, resulting in “onerous registration, reporting, and dissolution requirements.”

On September 7, 2010, IRTL filed a four-count verified complaint in the United States District Court for the Southern District of Iowa. It named as defendants the executive director and the board members of the Iowa Ethics and Campaign Disclosure Board (Board).² Count I—the count at issue here—challenged Iowa Code sections 68A.102(18) and 68A.402(9) (2011), alleging they unconstitutionally imposed PAC status on corporations “whose major purpose is something other than nominating or electing candidates.” Other counts (II–IV) attacked various Iowa statutes and administrative rules regarding the registration, reporting, and termination requirements for independent expenditure committees; Iowa's ban on corporate contributions to candidates and committees; and a newly enacted Iowa requirement that corporations making independent campaign expenditures obtain prior board of director approval for those expenditures.

IRTL initially filed a motion for preliminary injunction, which was denied by the district court on October 20, 2010. Iowa Right to Life Comm., Inc. v. Smithson, 750 F.Supp.2d 1020, 1049 (S.D.Iowa 2010). Both sides then moved for summary judgment. On June 29, 2011, the district court granted summary judgment for the Board on all counts except Count I. Iowa Right to Life Comm., Inc. v. Tooker, 795 F.Supp.2d 852, 873 (S.D.Iowa 2011).

The district court reserved ruling on Count I because it had doubts about the proper interpretation of Iowa's election laws. Id. at 861–62. In particular, the court questioned the premise of IRTL's constitutional challenge, namely that IRTL would be deemed a “political committee” or PAC under sections 68A.102(18) and 68A.402(9) if it made independent campaign expenditures. Id. To eliminate its uncertainty about the proper interpretation of Iowa law, the district court certified the aforementioned two questions to this court. Id. at 862.

II. Analysis.

A. Pre– Citizens United Statutory Background. Before we turn to the certified questions themselves, some historical background is appropriate. As this background reveals, as of January 2010, when Citizens United was decided, Iowa had (1) a ban on corporate expenditures in candidate elections dating back to 1975, (2) a definition of “political committee” that also went back to 1975 and had gone through several permutations, (3) a 1983 decision of this court holding that a nonprofit corporation engaged in a ballot issue campaign could be deemed a “political committee,” and (4) a separate set of provisions that first entered the Iowa Code in 1994 and had undergone later modification allowing persons and entities to make and report “independent expenditures” in some circumstances without forming “political committees.”

Our story begins in 1907. In March of that year, Iowa enacted a ban on corporate contributions to political campaigns. It provided:

It shall be unlawful for any corporation doing business within the state, or any officer, agent or representative thereof acting for such corporation, to give or contribute any money, property, labor or thing of value, directly or indirectly, to any member of any political committee, political party, or employee or representative thereof, or to any candidate for any public office or candidate for nomination to any public office or to the representative of such candidate, for campaign expenses or for any political purpose whatsoever, or to any person, partnership or corporation for the purpose of influencing or causing such person, partnership or corporation to influence any elector of the state to vote for or against any candidate for public office or for nomination for public office or to any public officer for the purpose of influencing his official action, but nothing in this act shall be construed to restrain or abridge the liberty of the press or prohibit the consideration and discussion therein of candidacies, nomination, public officers or political questions.

1907 Iowa Acts ch. 73, § 1. This statute followed by approximately two months Congress's approval of a similar ban on corporate contributions to federal campaigns—the so-called Tillman Act. See ch. 420, 34 Stat. 864 (January 26, 1907) (making it “unlawful for any corporation whatever to make a money contribution in connection with any election at which Presidential and Vice–Presidential electors or a Representative in Congress is to be voted for or any election by any State legislature of a United States Senator”).

However, comprehensive campaign finance legislation did not come to Iowa or the federal government until the 1970s, following the Watergate scandal. Iowa's first such campaign finance law was approved in 1973 and became chapter 56 of the Iowa Code. 1973 Iowa Acts ch. 138. At that time, the 1907 legislation was still on the books in the same form in which it had been enacted sixty-six years earlier. See Iowa Code § 491.69 (1973). The general assembly did not address corporate contributions (or expenditures) in the new law, simply leaving the 1907 legislation as it was and where it was. “Political committee” was defined in the new campaign finance law as follows:

‘Political committee’ means a person, including a candidate, or committee, including a statutory political committee, which accepts contributions or makes expenditures in the aggregate of more than one hundred dollars in any one calendar year for the purpose of supporting or opposing a candidate for public office.

1973 Iowa Acts ch. 138, § 3(6).

In 1975, the general assembly revised the campaign finance law that it had enacted just two years before. 1975 Iowa Acts ch. 57. At that time, the restrictions on corporate political activity dating back to 1907 were repealed and a modified version of them was placed in the campaign finance chapter. Id. § 17. Hence, a new provision regarding corporate political activity was inserted into chapter 56. This provision read in part:

It shall be unlawful for any insurance company, savings and loan association, bank, and corporation organized pursuant to the laws of this...