Speech v. Fed. Election Comm'n

• Decision Date: 25 June 2013
• Docket Number: No. 13–8033.,13–8033.
• Parties: FREE SPEECH, Plaintiff–Appellant, v. FEDERAL ELECTION COMMISSION, Defendant–Appellee.
• Court: U.S. Court of Appeals — Tenth Circuit

720 F.3d 788

FREE SPEECH, Plaintiff–Appellant,

v.FEDERAL ELECTION COMMISSION, Defendant–Appellee.

No. 13–8033.

United States Court of Appeals, Tenth Circuit.

June 25, 2013.

Benjamin T. Barr, Rockville, MD (Stephen Klein, Wyoming Liberty Group, Cheyenne, WY and Jack Speight, Cheyenne, WY, with him on the briefs), for Plaintiff–Appellant.

Kevin Deeley, Acting Associate General Counsel (Anthony Herman, General Counsel, Lisa J. Stevenson, Deputy General Counsel–Law, Erin Chlopak, Acting Assistant General Counsel, David Kolker, Associate General Counsel and Adav Noti, Acting Assistant General Counsel, with him on the briefs), Federal Election Commission, Washington, D.C., for Defendant–Appellee.

Fred Wertheimer, Democracy 21, Washington, D.C.; Donald J. Simon, Sonosky, Chambers, Sachse, Endreson & Perry, LLP, Washington, D.C.; J. Gerald Hebert, Tara Malloy and Paul S. Ryan, The Campaign Legal Center, Washington, D.C.; and Larry B. Jones, Simpson, Kepler & Edwards, LLC, The Cody, Wyoming Division of Burg Simpson Eldredge Hersh & Jardine, P.C., Cody, Wyoming, on the Briefs for Amici Curiae.

Before BRISCOE, Chief Judge, BRORBY, and MURPHY, Circuit Judges.

MURPHY, Circuit Judge.

Plaintiff–Appellant, Free Speech, appeals the district court's dismissal of the complaint it filed in July 2012, alleging certain regulations and practices of Defendant–Appellee, the Federal Election Commission (“FEC”), violate its rights under the First Amendment. After careful review of the appellate filings, the district court's order, and the entire record, we affirm the dismissal for substantially the reasons stated by the district court.

The district court correctly concluded Free Speech's claims implicate only disclosure requirements which are subject to exacting scrutiny, requiring “a substantial relation between the disclosure requirement and a sufficiently important governmental interest.” Citizens United v. Fed. Election Comm'n, 558 U.S. 310, 366–67, 130 S.Ct. 876, 175 L.Ed.2d 753 (2010) (quotations omitted). Further, the district court comprehensively analyzed and correctly resolved Free Speech's constitutional challenges to the FEC's definition of express advocacy, codified at 11 C.F.R. § 100.22(b); the standard used by the FEC to determine whether a request for funds is a solicitation of contributions under 2 U.S.C. § 441d(a); and the FEC's policy of determining political committee status on a case-by-case basis.¹

Accordingly, this court adopts the district court's analysis as the opinion of this court and orders the district court's memorandumdecision and order granting the FEC's Motion to Dismiss to be published.

ORDER GRANTING FEDERAL ELECTION COMMISSION'S MOTION TO DISMISS

This matter comes before the Court on Defendant Federal Election Commission's (“FEC” or “the Commission”) Motion to Dismiss [Doc. 33]. The Court, having reviewed the parties' written submissions, being familiar with the case file by virtue of having previously heard argument and having addressed the likelihood of success on the merits of Plaintiff's claims in conjunction with Plaintiff's Motion for Preliminary Injunction (Doc. 19) and this Court's oral ruling denying same (Docs. 41, 42 and 54), and considering itself otherwise fully advised in the premises of the motion, hereby FINDS and ORDERS as follows:

Factual and Procedural Background

Plaintiff Free Speech is an unincorporated nonprofit association formed on February 21, 2012 and is comprised of three Wyoming residents. Free Speech's stated mission is to promote and protect free speech, limited government, and constitutional accountability, and to advocate positions on various political issues including free speech, sensible environmental policy, gun rights, land rights, and control over personal health care. Its bylaws require that it operate independently of political candidates, committees, and political parties. (Am. Compl. ¶¶ 1 & 10; Am. Compl. Ex. A at Ex. 1.) On July 26, 2012, Plaintiff filed this lawsuit challenging certain FEC regulations that Plaintiff alleges abridge its First Amendment freedoms. Specifically, Plaintiff brings facial and as applied challenges against 11 C.F.R. § 100.22(b), alleging its definition of “express advocacy” is unconstitutionally vague and overbroad and triggers burdensome registration and reporting requirements which act as the functional equivalent of a prior restraint on political speech. Plaintiff further challenges the constitutionality of the FEC's interpretation and enforcement process regarding political committee status, solicitation tests, the “major purpose” test, and express advocacy determinations. (Am. Compl. ¶ 2.)

On July 13, 2012, Free Speech filed a Motion for Preliminary Injunction (Doc. 19) seeking to enjoin the FEC from enforcing any of the challenged regulations or policies. This matter was fully briefed by the parties and amicus curiae and the Court heard oral argument on the motion on September 12, 2012. On October 3, 2012, this Court issued an oral ruling denying Plaintiff's motion for preliminary injunction. (Docs. 41, 42, and 54.) Plaintiff timely appealed on October 19, 2012, and Plaintiff's interlocutory appeal is currently pending before the Tenth Circuit Court of Appeals.

Prior to the Court's oral ruling on Plaintiff's Motion for Preliminary Injunction, the FEC filed a motion to dismiss Plaintiff's claims pursuant to Fed.R.Civ.P. 12(b)(6). This motion has been fully briefed and is ripe for a decision on the merits.

“Ordinarily an interlocutory injunction appeal under 1292(a)(1) does not defeat the power of the trial court to proceed further with the case.” 16 C. Wright, A. Miller, E. Cooper, Federal Practice and Procedure § 3921.2 (hereinafter “Wright & Miller”). “Although the filing of a notice of appeal ordinarily divests the district court of jurisdiction, in an appeal from an order granting or denying a preliminary injunction, a district court may nevertheless proceed to determine the action on the merits.” U.S. v. Price, 688 F.2d 204, 215 (3d Cir.1982) (internal citation omitted). “The desirability of prompt trial-court action in injunction cases justifies trial-court consideration of issues that may be open in the court of appeals. A good illustration is provided by a motion to dismiss for failure to state a claim.” Wright & Miller § 3921.2. Although a court of appeals may determine whether a claim has been stated as part of the interlocutory appeal, a district court nonetheless retains jurisdiction to dismiss for failure to state a claim pending appeal. Id. This power is desirable “both in the interest of expeditious disposition and in the face of uncertainty as to the extent to which the court of appeals will exercise its power.” Id.

In addressing this matter now, this Court is mindful of the issues that have been presented on appeal as well as the current stage of the appellate litigation. This case presents purely legal questions that have been fully briefed and argued to this Court. Because this Court's substantive analysis of the constitutional issues addressed in the pending motion to dismiss is identical to that set forth in the Court's ruling denying Plaintiff's preliminary injunction motion, the Court deems it appropriate to address Plaintiff's claims on the merits. Therefore, for the reasons set forth on the record during the Court's oral ruling, and for the reasons set forth more fully below, the Court will grant Defendant's motion to dismiss for failure to state a claim.

Standard of Review

“To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’ ” Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007)). “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id. at 678, 129 S.Ct. 1937 (quoting Twombly, 550 U.S. at 556, 127 S.Ct. 1955). “In evaluating a Rule 12(b)(6) motion to dismiss, courts may consider not only the complaint itself, but also attached exhibits, and documents incorporated into the complaint by reference.” Smith v. United States, 561 F.3d 1090, 1098 (10th Cir.2009).

Discussion

A. Standard of Review—Exacting Scrutiny

At the outset, this Court addresses Plaintiff's contention that this Court should apply strict scrutiny to the regulations and policies at issue. Plaintiff challenges, on an as-applied and facial basis, the FEC's definition of “express advocating,” see11 C.F.R. § 100.22(b), the FEC's policy for determining political committee status, and the FEC's policy for determining when donations given in response to solicitations will be deemed “contributions.” At their core, however, these challenged rules and policies implement only disclosure requirements. See 2 U.S.C. § 434(c) (reporting requirements for “independent expenditures”); 2 U.S.C. § 432, 433, 434(a)(4) (political reporting and organization requirements). The question before this Court, therefore, is not whether Plaintiff can make expenditures for the speech it proposes or raise money without limitation, but simply whether it must provide disclosure of its electoral advocacy.

“Disclaimer and disclosure requirements may burden the ability to speak, but they impose no ceiling on campaign-related activities, and do not prevent anyone from speaking.” Citizens United v. FEC, 558 U.S. 310, 130 S.Ct. 876, 914, 175 L.Ed.2d 753 (2010) (internal citations and quotation marks omitted). Accordingly, the SupremeCourt has subjected those requirements to “exacting scrutiny” which requires “a substantial relation between the disclosure requirement and a sufficiently important governmental interest.” Id.; see also Real Truth About Abortion (RTAA) v. FEC, 681 F.3d 544, 549 (4th Cir.2010) (“...