Travis v. Brand

• Decision Date: 19 March 2021
• Docket Number: B298104, B301479
• Citation: 276 Cal.Rptr.3d 535,62 Cal.App.5th 240
• Court: California Court of Appeals Court of Appeals
• Parties: Arnette TRAVIS et al., Plaintiffs and Appellants, v. Bill BRAND et al., Defendants and Respondents; Redondo Beach Waterfront, LLC, et al., Appellants. Arnette Travis et al., Plaintiffs and Appellants, v. Bill Brand et al., Defendants and Respondents.

62 Cal.App.5th 240

276 Cal.Rptr.3d 535

Arnette TRAVIS et al., Plaintiffs and Appellants,

v.Bill BRAND et al., Defendants and Respondents; Redondo Beach Waterfront, LLC, et al., Appellants.

Arnette Travis et al., Plaintiffs and Appellants,

v.Bill Brand et al., Defendants and Respondents.

B298104, B301479

Court of Appeal, Second District, Division 8, California.

Filed March 19, 2021

The Sutton Law Firm, Bradley W. Hertz, James R. Sutton and Nicholas L. Sanders for Plaintiffs and Appellants.

Shumener, Odson & Oh, Betty M. Shumener and John D. Spurling, Los Angeles, for Appellants in No. B298104.

Gabriel & Associates and Stevan Colin, Long Beach, for Defendants and Respondents Bill Brand, Brand for Mayor 2017 and Linda Moffat.

Law Offices of Bobak Nayebdadash and Bobak Nayebdadash for Defendants and Respondents Wayne Craig and Rescue Our Waterfront, P.A.C.

Carlson & Messer and Jeanne L. Zimmer, Los Angeles, for Defendant and Respondent Nils Nehrenheim.

WILEY, J.

This case is about a political campaign. In a Redondo Beach municipal election, a political action committee and two political candidates successfully campaigned for a ballot measure. After the vote, two citizens sued the committee and these candidates, claiming the candidates had controlled the committee, which had used an improper title for itself. The trial court vindicated the committee and the candidates and awarded them attorney fees. This consolidated appeal is from the judgment and the fee award. We reverse the judgment as to some nonparties and otherwise affirm.

I

This opinion features a rather large cast of actors. One way to introduce them is by their self-identified political affiliations. They differed over whether to support or oppose a large redevelopment of the Redondo Beach municipal waterfront. A judicial opinion described this political contest. (See Redondo Beach Waterfront, LLC v. City of Redondo Beach (2020) 51 Cal.App.5th 982, 986–990, 265 Cal.Rptr.3d 556 ( Waterfront ).) In particular, forces opposing the redevelopment backed a so-called Measure C. Those favoring the redevelopment opposed Measure C.

Two citizens of Redondo Beach, Arnette Travis and Chris Voisey, opposed Measure C and favored the redevelopment. Travis and Voisey are the plaintiffs and appellants. They sued a political action committee and two candidates. The political action committee is Rescue Our Waterfront, which we shorten to "Rescue." The candidates are Redondo Beach Mayor Bill Brand and Redondo Beach City Councilmember Nils Nehrenheim. Travis and Voisey also sued Wayne Craig, a principal officer of Rescue. Travis and Voisey additionally sued Brand's mayoral campaign committee, as well as its treasurer, Linda Moffat.

All these defendants—Rescue, Brand, Nehrenheim, Craig, the campaign committee, and Moffat—are now respondents in this appeal.

As we will explain, the trial court entered judgment against plaintiffs Travis and Voisey and awarded attorney fees against them. Travis and Voisey appeal the judgment and the fees.

Nonparties Redondo Beach Waterfront, LLC (Waterfront), Fred Bruning, and Jean Paul Wardy also appeal the judgment. Bruning and Wardy were the principals for Waterfront and for CenterCal Properties, LLC (CenterCal). CenterCal is a developer the city of Redondo Beach selected in 2012 for proposed redevelopment of the city's waterfront. We call Waterfront, Bruning, and Wardy collectively the nonparties.

We summarize Redondo Beach's March 7, 2017 election.

On June 28, 2016, Craig, Nehrenheim, and one Martin Holmes submitted a "Notice of Intent to Circulate Petition" to the city of Redondo Beach seeking to place a local initiative—the King Harbor Coastal Access, Revitalization, and Enhancement Initiative, later designated Measure C—on the ballot for the next election. They succeeded: Measure C indeed was on the ballot for this election. Measure C aimed to limit development and to roll back the waterfront redevelopment project.

On July 1, 2016, Craig and Holmes signed a "Statement of Organization" form designating Rescue as both a "general purpose" and a "primarily formed" committee. It also indicated Rescue was not a controlled committee. The Secretary of State rejected the form because Rescue could be general purpose or primarily formed but not both.

The "general purpose," "primarily formed," and "controlled" classifications are fundamental to the merits of this case. We thumbnail these terms now and give more comprehensive definitions later. General purpose committees support or oppose more than one candidate or ballot measure. ( Gov. Code, § 82027.5.) Primarily formed committees support or oppose a single candidate, single measure, multiple candidates in a single election, or multiple measures in a single election. (§ 82047.5.) A committee can be either general purpose or primarily formed. Either type of committee may also be candidate-controlled, which means a candidate has significant influence over the committee. (§ 82016.)

Why do the designations matter? We looked to the law's purpose for answers. The Political Reform Act was a voter-approved initiative on California's 1974 primary election ballot. ( Gov. Code, § 81001.) The law's findings noted costs of election campaigns had recently surged, expressed concern about the disproportionate influence of wealthy people and organizations on governmental decisions, and found previous disclosure requirements had been inadequate. (Ibid. ) At trial, Travis and Voisey's expert said the law's disclosure requirements are meant to help the public make informed voting decisions. These general principles, however, tell us little about this particular and narrow issue of categorization.

The main disclosure in this case appears to be in the committee name. Committees primarily formed to support or oppose a measure must say so in their name, for example "No on Measure A." ( Gov. Code, § 84107 ; Cal. Fair Pol. Practices Com., Committee Naming Requirements, at [as of March 17, 2021], archived at .) Similarly, a controlling candidate's name is part of the committee's name. ( Cal. Code Reg., tit. 2, § 18521.5.) Travis and Voisey's lawyer sought to explain why the name mattered in his closing argument at trial: Rescue's name "deceived" voters by hiding that Rescue was primarily formed to support Measure C and was controlled. Without the deception, the committee may not have gotten the same level of financial and voter support. We understand this argument to be about voters’ relative trust in each type of committee. The hypothesis must be that voters are more willing to trust general purpose committees, which are oriented to general and long-term ideals, like supporting slow-growth development. Conversely, the supposition must be that voters are warier of primary purpose committees, which may exist only briefly and thus lack accountability, and may be opportunistically and singularly driven to pass a measure. Similarly, the hypothesis must be that voters have more trust in committees that are independent from candidates. This at any rate appears to be the general idea.

We turn back to Rescue. It corrected and resubmitted its form in August 2016. The corrected form designated Rescue a general purpose committee. Craig and Holmes described their plan for Rescue's activities on the form: "Support candidates & ballot measures to preserve the Redondo Beach Coastal zone and related activities." Craig and Holmes left the "Controlled Committee" section blank, indicating Rescue was not a candidate-controlled committee.

Measure C passed in the March 7, 2017 election. Division Three of this appellate district later affirmed a declaratory judgment, however, that Measure C could not restrict Waterfront's statutory vested rights for this project. ( Waterfront , supra , 51 Cal.App.5th at pp. 994–999, 265 Cal.Rptr.3d 556.)

In the same election, Brand won his bid for mayor. Nehrenheim qualified for a run-off election and later won a seat on the city council.

On June 15, 2017, Travis and Voisey filed a complaint alleging the defendants violated the Political Reform Act of 1974 ( Gov. Code, § 81000 et seq. ) and related regulations.

The complaint included two main issues, both related to the March 7, 2017 election and Measure C.

The first issue was about Rescue's purpose. Travis and Voisey alleged Rescue was not a general purpose committee but a primarily formed committee, which its founders created to support Measure C. Travis and Voisey contended the law thus required Rescue, as a primarily formed committee, to include words like "Yes on Measure C" in its name. Additionally, Rescue could not have categorized expenditures to support Measure C as independent expenditures.

The second issue was about whether Brand and Nehrenheim controlled Rescue. Travis and Voisey alleged Brand and Nehrenheim "exerted significant influence and control over" Rescue and were "controlling candidates." According to Travis and Voisey, the candidates improperly "failed to disclose [their] controlling candidate status on their campaign reports."

Travis and Voisey sought injunctive relief compelling the defendants to comply with the Political Reform Act.

A five-day bench trial began November 14, 2018. Eleven witnesses testified.

Travis and Voisey testified they were residents of Redondo Beach and followed local politics.

Craig, principal officer and treasurer of Rescue, testified that he and Holmes formed Rescue. They intended Rescue to support multiple activities, candidates, and ballot measures related to the Redondo harbor area. Selecting both "general purpose" and "primarily formed" on Rescue's initial Statement of Organization was "an error in completing the form." He and Holmes corrected and resubmitted the form to say Rescue was a general purpose committee based on guidance from the California Fair Political Practices Commission (the Commission). At the time of the trial, Rescue had supported Measure C, at least four candidates, a California Environmental Quality Act lawsuit, and...