[1] evidence 157 43(4) background - california state controller · 2019-11-02 · all presumptions...

147 Cal.App.4th 1319 147 Cal.App.4th 1319, 55 Cal.Rptr.3d 272, 07 Cal. Daily Op. Serv. 2075(Cite as: 147 Cal.App.4th 1319)

© 2007 Thomson/West. No Claim to Orig. U.S. Govt. Works.

California Family Bioethics Council v. CaliforniaInstitute for Regenerative MedicineCal.App. 1 Dist.,2007.

Court of Appeal, First District, Division 3, California.CALIFORNIA FAMILY BIOETHICS COUNCIL,

Plaintiff and Appellant,v.

CALIFORNIA INSTITUTE FOR REGENERATIVEMEDICINE et al., Defendants and Respondents.

People's Advocate et al., Plaintiffs and Appellants,v.

Independent Citizen's Oversight Committee et al.,Defendants and Respondents.

Nos. A114195, A114282.

Feb. 26, 2007.

Background: Advocacy groups filed two actionschallenging constitutionality of the California Stem CellResearch and Cures Act enacted by Proposition 71, andthose actions were consolidated. The Superior Court,Alameda County, Nos. HG05 206766, HG05235177,Bonnie Lewman Sabraw, J., ruled that the Actwas constitutional. Advocacy groups appealed.

Holdings: The Court of Appeal, Pollak, J., held that:

(1) the Act did not violate the single-subject rule;

(2) the legislative analysis in ballot materials submittedto voters was not so false or misleading as to violatedue process;

(3) the Act did not violate the constitutional prohibitionagainst public funding of entities outside of the state'sexclusive management and control;

(4) conflict of interest rules built into the Act wereconsistent with state law and public policy, and thus didnot render the Act invalid; and

(5) any error in exclusion of evidence ofcorrespondence among university employeesrepresented in independent citizen's oversightcommittee (ICOC) authorized by Act was notprejudicial.

Affirmed.West Headnotes[1] Evidence 157 43(4)

157 Evidence 157I Judicial Notice 157k43 Judicial Proceedings and Records 157k43(4) k. Proceedings in Other Courts.Most Cited CasesOn appeal from trial court's rejection of advocacygroups' challenge to constitutionality of California StemCell Research and Cures Act enacted by Proposition 71,Court of Appeal would grant appellants' request that ittake judicial notice of documents filed in mandamusaction that appellants had previously filed in stateSupreme Court.

[2] Appeal and Error 30 893(1)

30 Appeal and Error 30XVI Review 30XVI(F) Trial De Novo 30k892 Trial De Novo 30k893 Cases Triable in Appellate Court 30k893(1) k. In General. Most CitedCasesConstitutional issues are questions of law reviewed denovo.

[3] Constitutional Law 92 47

92 Constitutional Law 92II Construction, Operation, and Enforcement ofConstitutional Provisions 92k44 Determination of Constitutional Questions 92k47 k. Scope of Inquiry in General. MostCited Cases



Constitutional Law 92 70.1(2)

92 Constitutional Law 92III Distribution of Governmental Powers andFunctions 92III(B) Judicial Powers and Functions 92k70 Encroachment on Legislature 92k70.1 In General 92k70.1(2) k. Making, Interpretation,and Application of Laws. Most Cited Cases

Constitutional Law 92 70.3(4)

92 Constitutional Law 92III Distribution of Governmental Powers andFunctions 92III(B) Judicial Powers and Functions 92k70 Encroachment on Legislature 92k70.3 Inquiry Into Motive, Policy,Wisdom, or Justice of Legislation 92k70.3(4) k. Wisdom. Most CitedCasesWhen evaluating the constitutionality of initiativemeasures, the Court of Appeal does not consider orweigh the economic or social wisdom or generalpropriety of the initiative, but evaluatesconstitutionality in the context of establishedconstitutional standards.

[4] Statutes 361 301

361 Statutes 361IX Initiative 361k301 k. Initiative in General. Most CitedCasesThe initiative power must be liberally construed topromote the democratic process.

[5] Statutes 361 301

361 Statutes 361IX Initiative 361k301 k. Initiative in General. Most CitedCasesCourts must jealously guard the precious initiativepower and resolve any reasonable doubts in favor of itsexercise.

[6] Constitutional Law 92 48(1)

92 Constitutional Law 92II Construction, Operation, and Enforcement ofConstitutional Provisions 92k44 Determination of Constitutional Questions 92k48 Presumptions and Construction inFavor of Constitutionality 92k48(1) k. In General. Most Cited CasesAll presumptions favor the validity of initiativemeasures; such measures must be upheld unless theirunconstitutionality clearly, positively, and unmistakablyappears.


92 Constitutional Law 92II Construction, Operation, and Enforcement ofConstitutional Provisions 92k44 Determination of Constitutional Questions 92k47 k. Scope of Inquiry in General. MostCited Cases

Municipal Corporations 268 121

268 Municipal Corporations 268IV Proceedings of Council or Other GoverningBody 268IV(B) Ordinances and By-Laws in General 268k121 k. Proceedings to Determine Validityof Ordinances. Most Cited CasesFacial challenge to constitutional validity of statute orordinance considers only text of measure itself, not itsapplication to particular circumstances of individual.


92 Constitutional Law 92II Construction, Operation, and Enforcement ofConstitutional Provisions 92k37 Validity of Statutory Provisions 92k38 k. In General. Most Cited Cases“As applied” challenge to constitutionality of statuteseeks relief from specific application of facially validstatute to individual or class of individuals, or seeks toenjoin future application of statute in allegedlyimpermissible manner in which is it shown to have been



applied in past.

[9] Statutes 361 105(1)

361 Statutes 361III Subjects and Titles of Acts 361k105 Constitutional Requirements andRestrictions 361k105(1) k. In General. Most Cited CasesThe single-subject rule is designed to avoid confusionof either voters or petition signers and to preventsubversion of the electorate's will. West's Ann.Cal.Const. Art. 2, § 8(d).

[10] Statutes 361 308

361 Statutes 361IX Initiative 361k308 k. Title and Text of Proposed Act andOther Information. Most Cited CasesAn initiative measure does not violate the single-subjectrequirement if, despite its varied collateral effects, all ofits parts are reasonably germane to each other, and tothe general purpose or object of the initiative. West'sAnn.Cal. Const. Art. 2, § 8(d).

[11] Health 198H 105

198H Health 198HI Regulation in General 198HI(A) In General 198Hk102 Constitutional and StatutoryProvisions 198Hk105 k. Validity. Most Cited Cases

Statutes 361 325

361 Statutes 361IX Initiative 361k325 k. Constructions, Operation and Effectof Initiated Acts. Most Cited CasesCalifornia Stem Cell Research and Cures Act enactedby Proposition 71 did not violate the single-subject rule;provisions authorizing “other vital research,” andspecifying conflict of interest rules for members ofindependent citizen's oversight committee (ICOC),which was authorized by Act to govern institute

established to effectuate Act, were functionally relatedand reasonably germane to overarching subject of stemcell research and funding. West's Ann.Cal. Const. Art.2, § 8(d); Art. 35, § 2; West's Ann.Cal.Health & SafetyCode §§ 125290.10 et seq., 125291.10 et seq.See 7 Witkin, Summary of Cal. Law (10th ed. 2005)Constitutional Law, § 133.[12] Constitutional Law 92 274.2(1)

92 Constitutional Law 92XII Due Process of Law 92k274.2 Political Rights and DeprivationThereof 92k274.2(1) k. In General. Most Cited Cases

Statutes 361 320

361 Statutes 361IX Initiative 361k320 k. Ballot Title, Description of ProposedAct, Arguments Pro and Con. Most Cited CasesLegislative analysis provided for voters in ballotmaterials for initiative establishing California Stem CellResearch and Cures Act was not so false andmisleading as to violate due process; there were nomisleading financial projections, as any representationsof benefits to state budget were couched in conditionalterms, and analysis adequately explained widelypublicized scientific terms relevant to stem cell researchand Act's conflict of interest provisions for members ofthe independent citizen's oversight committee (ICOC),which was authorized by the Act to govern the instituteestablished by a new state constitutional provision.U.S.C.A. Const.Amend. 14; West's Ann.Cal. Const.Art. 35, § 2; West's Ann.Cal.Health & Safety Code §§125290.10 et seq., 125291.10 et seq.

[13] States 360 119

360 States 360IV Fiscal Management, Public Debt, andSecurities 360k119 k. Limitation of Use of Funds or Credit.Most Cited CasesCalifornia Stem Cell Research and Cures Act enactedby Proposition 71 did not violate constitutionalprohibition against public funding of entities outside of



the state's exclusive management and control; electedofficials of both legislative and executive branches ofgovernment appointed or nominated majority ofmembers of independent citizen's oversight committee(ICOC), which was authorized by Act to governinstitute established by new constitutional provision,institute was subject to significant public and financialaccountability standards, and there were strict limits onfunding built into Act. West's Ann.Cal. Const. Art. 16,§ 3; Art. 35, § 2; West's Ann.Cal.Gov.Code § 12410;West's Ann.Cal.Health & Safety Code §§ 125290.10 etseq., 125291.10 et seq.See Cal. Jur. 3d, State of California, § 89.[14] Health 198H 105

198H Health 198HI Regulation in General 198HI(A) In General 198Hk102 Constitutional and StatutoryProvisions 198Hk105 k. Validity. Most Cited CasesConflict of interest rules built into California Stem CellResearch and Cures Act enacted by Proposition 71,which rules applied to members of independent citizen'soversight committee (ICOC) that was authorized by Actto govern institute established by new stateconstitutional provision, were consistent with state lawand public policy, and thus did not render the Actinvalid; Act expressly prohibited members of ICOCfrom participating in decisions involving grantapplications submitted by institutions with which theywere affiliated, and Act incorporated not only its ownspecific conflict of interest restrictions, but also thoseimposed by Political Reform Act. West's Ann.Cal.Const. Art. 35, § 2; West's Ann.Cal.Gov.Code § 81000et seq.; West's Ann.Cal.Health & Safety Code §§125290.10 et seq., 125290.30(g), 125291.10 et seq.

[15] Appeal and Error 30 1056.1(3)

30 Appeal and Error 30XVI Review 30XVI(J) Harmless Error 30XVI(J)11 Exclusion of Evidence 30k1056 Prejudicial Effect 30k1056.1 In General 30k1056.1(3) k. Particular Evidence.

Most Cited CasesAny error in exclusion of evidence of correspondenceamong university employees represented in independentcitizen's oversight committee (ICOC) created byCalifornia Stem Cell Research and Cures Act enactedby Proposition 71, in action by advocacy groupschallenging constitutionality of Act, was notprejudicial; even if considered, evidence establishedthat faculty and administration at universities wereworking together cooperatively at times to furtherinterests of both institute established by Act anduniversities, while remaining mindful of potential foractual and perceived conflicts of interest, and thusadmission of evidence would not have affected trialcourt's rejection of groups' constitutional challenges toAct. West's Ann.Cal. Const. Art. 35, § 2; West'sAnn.Cal.Health & Safety Code §§ 125290.10 et seq.,125291.10 et seq.

Llewellyn † Spann, David L. Llewellyn, Jr., CitrusHeights, for plaintiff and appellant California FamilyBioethics Council.Life Legal Defense Foundation, Dana Cody, CatherineW. Short, Robert M. Taylor, San Clemente, Terry L.Thompson, for plaintiffs and appellants People'sAdvocate, National Tax Limitation Foundation.Bill Lockyer, Attorney General, Robert Anderson,Chief Deputy Attorney General, Tom Greene, James M.Humes, Chief Assistant Attorneys General, LeslieLopez, Tamar Pachter, Deputy Attorneys General, fordefendants and respondents.Munger, Tolles & Olson LLP, O'Malley M. Miller,Michael R. Doyen, Mark H. Epstein, Paul J. Watford,Los Angeles, for amicus curiae for California Instituteof Technology, Keck Graduate Institute, The Board ofTrustees of the Leland Stanford Junior University,University of Southern California, Burnham Institutefor Medical Research, Children's Hospital Los Angeles,Oakland, Cedars-Sinai Medical Center, City of Hope,Salk Institute for Biological Studies, Alliance for AgingResearch, Alliance for Stem Cell Research, ALSAssociation, Alzheimer's Association CaliforniaCouncil, Cancer Research & Prevention Foundation,Christopher Reeve Foundation, Cystic FibrosisResearch, Inc., Elizabeth Glaser Pediatric AIDSFoundation, Juvenile Diabetes Research Foundation,



The Leukemia & Lymphoma Society, Michael J. FoxFoundation for Parkinson's Research, National BrainTumor Foundation, National Multiple SclerosisSociety, Parkinson's Action Network, San FranciscoAIDS Foundation, Southern California BiomedicalCouncil, Dr. Paul Berg, Nobel Laureate on behalf ofdefendant and respondent.POLLAK, J.*1330 Before us is an appeal from two consolidatedactions challenging the validity of Proposition 71, thestem cell research initiative approved by a substantialmajority of the voters at the General Election onNovember 2, 2004. Relying in significant part on thereasoning of California Assn. of Retail Tobacconists v.State of California (2003) 109 Cal.App.4th 792, 135Cal.Rptr.2d 224 (CART ),FN1 the trial courtrejected**276 the diverse challenges that appellantshave directed to Proposition 71 and to the method of itsenactment. We agree with the conclusions reached inthe comprehensive opinion of the trial court FN2 ANDSHALL AFFIRM ITS judgment.

FN1. CART upheld against similar challengesthe validity of an initiative enacting theCalifornia Children and Families Act of 1998(Health & Saf.Code, § 130100 et seq.; Rev. &Tax.Code, § 30131 et seq.), increasing thetobacco excise tax, creating the CaliforniaChildren and Families Commission, andfunding early childhood development andantismoking programs. (CART, supra, 109Cal.App.4th 792, 135 Cal.Rptr.2d 224.)

FN2. Appellants have not renewed all of theirarguments that were rejected by the trial court. We of course consider only those that areraised on appeal.

Factual and Procedural History

A. Summary of Proposition 71

Although section 1 of the proposition states that theentire measure shall be known as the California StemCell Research and Cures Act,FN3 Proposition 71 in fact

adds an amendment to the California Constitution, twoseparate acts to the Health and Safety Code, andexpands the Government Code definition of “stateservice.”

FN3. The same title is used in the measure intwo ways. Section 1 of the proposition states,“This measure shall be known as the‘California Stem Cell Research and CuresAct.’ ” Section 5 of the proposition adds topart 5 of division 106 of the Health and SafetyCode a new chapter, chapter 3, which isentitled “California Stem Cell Research andCures Bond Act.” Article 1 of the new chapter(Health & Saf.Code, § 125290.10 et seq.), likethe proposition itself, is entitled “CaliforniaStem Cell Research and Cures Act.” Article 2(Health & Saf.Code, § 125291.10 et seq.) isentitled “California Stem Cell Research andCures Bond Act of 2004.”

Section 4 of the proposition adds to the Constitutionarticle XXXV, establishing the California Institute forRegenerative Medicine (CIRM or the institute). Thepurpose of the institute, according to the constitutionalamendment, is “(a) To make grants and loans for stemcell research, for research facilities, and for other vitalresearch opportunities to realize therapies, protocols,and/or medical procedures that will result in, asspeedily as *1331 possible, the cure for, and/orsubstantial mitigation of, major diseases, injuries, andorphan diseases. [¶] (b) To support all stages of theprocess of developing cures, from laboratory researchthrough successful clinical trials. [And][¶] (c) Toestablish the appropriate regulatory standards andoversight bodies for research and facilitiesdevelopment.” (Cal. Const., art. XXXV, § 2.) FN4

FN4. Section 3 of Proposition 71, whichdescribes the purpose and intent of theproposition, provides, “It is the intent of thepeople of California in enacting this measureto: [¶] Authorize an average of $295 millionper year in bonds over a 10-year period tofund stem cell research and dedicated facilities



for scientists at California's universities andother advanced medical research facilitiesthroughout the state. [¶] Maximize the use ofresearch funds by giving priority to stem cellresearch that has the greatest potential fortherapies and cures, specifically focused onpluripotent stem cell and progenitor cellresearch among other vital researchopportunities that cannot, or are unlikely to,receive timely or sufficient federal funding,unencumbered by limitations that wouldimpede the research. Research shall besubject to accepted patient disclosure andpatient consent standards. [¶] Assure that theresearch is conducted safely and ethically byincluding provisions to require compliancewith standards based on national models thatprotect patient safety, patient rights, andpatient privacy. [¶] Prohibit the use of bondproceeds of this initiative for funding forhuman reproductive cloning. [¶] Improve theCalifornia health care system and reduce thelong-term health care cost burden onCalifornia through the development oftherapies that treat diseases and injuries withthe ultimate goal to cure them. [¶] Requirestrict fiscal and public accountability throughmandatory independent audits, open meetings,public hearings, and annual reports to thepublic. Create an Independent Citizen'sOversight Committee composed ofrepresentatives of the University of Californiacampuses with medical schools; otherCalifornia universities and California medicalresearch institutions; California diseaseadvocacy groups; and California experts inthe development of medical therapies. [¶]Protect and benefit the California budget: bypostponing general fund payments on thebonds for the first five years; by fundingscientific and medical research that willsignificantly reduce state health care costs inthe future; and by providing an opportunityfor the state to benefit from royalties, patents,and licensing fees that result from theresearch. [¶] Benefit the California economy bycreating projects, jobs, and therapies that will

generate millions of dollars in new taxrevenues in our state. [¶] Advance the biotechindustry in California to world leadership, asan economic engine for California's future.”

**277 Article XXXV further establishes “a right toconduct stem cell research which includes researchinvolving adult stem cells, cord blood stem cells,pluripotent stem cells, and/or progenitor cells.” (Id., §5.) FN5 No funds of the institute, however, may be usedfor “research involving *1332 human reproductivecloning.” (Id., § 3.) FN6 The constitutional provisionprovides further, “Notwithstanding any other provisionof this Constitution or any law, the institute, which isestablished in state government, may utilize state issuedtax-exempt and taxable bonds to fund its operations,medical and scientific research, including therapydevelopment through clinical trials, and facilities.” (Id.,§ 6.) FN7 The final section of the constitutional provisionprovides that the institute and its employees are exemptfrom civil service. (Id., § 7.)

FN5. This provision goes on to provide thefollowing definitions: “Pluripotent stem cellsare cells that are capable of self-renewal, andhave broad potential to differentiate intomultiple adult cell types. Pluripotent stemcells may be derived from somatic cell nucleartransfer or from surplus products of in vitrofertilization treatments when such products aredonated under appropriate informed consentprocedures. Progenitor cells are multipotentor precursor cells that are partiallydifferentiated, but retain the ability to divideand give rise to differentiated cells.” (Cal.Const., art. XXXV, § 5.) Health and SafetyCode section 1644.9 provides, “For purposesof this section, the phrase ‘somatic cellnuclear transfer’ means the process in whichthe nucleus of a somatic cell of an organism istransferred into an enucleated oocyte.”

FN6. “Human reproductive cloning” isdefined as “the practice of creating orattempting to create a human being bytransferring the nucleus from a human cell



into an egg cell from which the nucleus hasbeen removed for the purpose of implantingthe resulting product in a uterus to initiate apregnancy.” (Health & Saf.Code, §125292.10, subd. (k).)

FN7. A separate section of the constitutionalamendment provides, “Funds authorized for,or made available to, the institute shall becontinuously appropriated without regard tofiscal year, be available and used only for thepurposes provided in this article, and shall notbe subject to appropriation or transfer by theLegislature or the Governor for any otherpurpose.” (Cal. Const., art. XXXV, § 4.)

To implement the goals of the constitutional provision,Proposition 71 adds to the Health and Safety Code FN8

the California Stem Cell Research and Cures Act (§125290.10 et seq., hereafter the Cures Act or the Act)and the California Stem Cell Research and Cures BondAct of 2004 (§ 125291.10 et seq., hereafter the BondAct).FN9

FN8. All further statutory references are to theHealth and Safety Code unless otherwiseindicated.

FN9. The proposition also expands thedefinition of “state service” in GovernmentCode section 20069 to include service for “theCalifornia Institute for Regenerative Medicineand the officers and employees of itsgoverning body.” (Prop.71, § 6.) Section 7 ofthe proposition contains a severabilityprovision. Section 8 provides that as ofNovember 2007, the Legislature may amendall but the bond provisions of the initiative “toenhance the ability of the institute to furtherthe purposes of the grant and loan programscreated by the measure,” by a bill approved by70 percent of the membership of both housesand signed by the Governor, provided thatcopies of the bill in final form are madepublicly available at least 14 days prior topassage in each house.

To govern the institute, the Cures Act creates anIndependent Citizen's Oversight **278 Committee(ICOC), which is “vested with full power, authority,and jurisdiction over the institute.” (§ 125290.15.) TheICOC consists of 29 members, 20 of whom areappointed by the Governor, the Lieutenant Governor,the Treasurer, or the Controller. Five are appointed bythe chancellors of the five University of Californiacampuses with medical schools. The Speaker of theAssembly and the President Pro Tempore of the Senateeach appoints one member and the final two, achairperson and vice-chairperson, are elected by theother ICOC members from persons nominated by thefour constitutional officers. (§ 125290.20, subd. (a).)There are stringent qualifications for appointmentdesigned to ensure that all members possess appropriateexperience and expertise and that personsknowledgeable in the various *1333 disease groups thatmay benefit from the research are represented. Ingeneral, the members must be executive officers ofCalifornia academic or research institutions with anestablished ability to conduct stem cell research,executive officers of a qualified life science commercialentity, or representatives of disease advocacygroups.FN10 Members are appointed for terms of eithersix or eight years, and may serve no more than twoterms. (Id., subd. (c)(1).)

FN10. Five of the 29 members of the ICOCmust be executive officers of specifiedUniversity of California campuses, each ofwhich has a medical school. (§ 12590.20,subd. (a)(1).) Four others must be executiveofficers from other California universities thathave “demonstrated success and leadership instem cell research” and have a nationallyranked research hospital and medical school,a recent proven history of administeringsizable scientific and/or medical researchgrants and contracts, or a recent rankingamong the top 10 United States universitieswith the highest number of life science patentsor who have research or clinical faculty whoare members of the National Academy ofSciences. (Id., subd. (a)(2)(A).) Four others



must be executive officers from a Californianonprofit academic and research institutionnot part of the University of California thathas demonstrated success and leadership instem cell research, that has a nationally rankedresearch hospital or research or clinical facultywho are members of the National Academy ofSciences and a proven history in the precedingfive years of managing a research budget inthe life sciences exceeding $20,000,000. (Id.,subd. (a)(2)(B).) Four others must beexecutive officers or board member from aCalifornia life science commercial entity witha background in implementing successfulexperimental medical therapies, not engagedin researching therapies with pluripotent orprogenitor stem cells, and not having beenawarded or applied for funding from theinstitute. (Id., subd. (a)(2)(C).) All of theseexecutive officers are authorized to delegatetheir duties to another executive officer of theentity with which they are affiliated or, ifapplicable, to the dean of the medical school. Only one member may be appointed from asingle university, institution or entity. (Id.,subd. (a)(2)(D).) The remaining membersmust be representatives from a diseaseadvocacy group concerned with specifieddiseases. (Id., subd. (a)(2)(B), (a)(5).) Stillmore stringent qualifications and additionalcriteria for consideration are specified for thechairperson and vice chairperson. (Id., subd.(a)(6).)

The ICOC is responsible for “oversee[ing] theoperations of the institute.” (§ 125290.40, subd. (a).)The statute provides a long list of the ICOC's functions,which include developing annual and long-termstrategic research and financial plans for the institute,making final decisions on research standards and grantawards in California, ensuring the completion of anannual financial audit of the institute's operations,issuing public reports on the activities of the institute,establishing policies regarding intellectual propertyrights arising from research funded by the institute,establishing rules and guidelines for the operation of theICOC and its working groups, selecting members of the

working groups, adopting, amending, and rescindingrules and regulations to carry out the purposes andprovisions of the Cures Act **279 and the Bond Actand to govern the procedures of the ICOC, requestingthe issuance of bonds from the California Stem CellResearch and Cures Finance Committee and loans fromthe Pooled Money Investment *1334 Board (id., subds.(b)-(g), (i)-(n)), and “perform[ing] all other actsnecessary or appropriate in the exercise of its power,authority, and jurisdiction over the institute” (id., subd.(h)).

The Cures Act also provides for the creation of threescientific and medical working groups to advise theICOC regarding research funding, accountabilitystandards and facilities. Members of the workinggroups are appointed by a majority vote of a quorum ofthe ICOC. (§ 125290.50, subds.(a), (b).) Differentqualifications are specified for membership in each ofthe working groups to ensure the appropriate expertisein each group. (§§ 125290.55, 125290.60, 125290.65.)FN11 The Cures Act also creates a “Citizen's FinancialAccountability Oversight Committee” to review theannual financial audit, the State Controller's report andthe financial practices of the institute. This committeeis chaired by the State Controller and includes publicmembers who “shall have medical backgrounds andknowledge of relevant financial matters” and who areappointed by the State Controller, State Treasurer,President Pro Tempore of the Senate, Speaker of theAssembly and chairperson of the ICOC. (§ 125290.30,subd. (c).)

FN11. Members of the 19-member Scientificand Medical Accountability StandardsWorking Group must include five ICOCmembers from groups focusing on specifieddisease-specific areas, nine “scientists andclinicians nationally recognized in the field ofpluripotent and progenitor cell research,” andfour “medical ethicists.” (§ 125290.55, subd.(a).) Members of the 23-member Scientificand Medical Research Funding WorkingGroup must include seven ICOC membersfrom groups focusing on specifieddisease-specific areas and 15 “scientists



nationally recognized in the field of stem cellresearch.” (§ 125290.60, subd. (a).) Membersof the 11-member Scientific and MedicalFacilities Working Group must include sixmembers of the Scientific and MedicalResearch Funding Working Group and four“real estate specialists.” (§ 125290.65, subd.(a).) The chairperson of the ICOC is amember of each of the working groups.

Members of the ICOC and of the working groups aresubject to conflict-of-interest rules, but the generallyapplicable Government Code provisions are qualifiedby standards set out in the Cures Act or authorized to beadopted by the ICOC for non-ICOC working groupmembers. (§§ 125290.30, subd. (g), 125290.50, subd.(e); see also pp. 306-07, post.) Meetings of the ICOCmust be held in compliance with the Bagley-KeeneOpen Meeting Act (Gov.Code, § 11120 et seq.) and theaward of all grants, loans and contracts, and theadoption of all standards must occur in public meetings.(§ 125290.30, subd. (d).) The California PublicRecords Act (Gov.Code, § 6250 et seq.) is, with certainexceptions, applicable to all records of the institute (§125290.30, subd. (e)). Except for grants and loansapproved by the ICOC, all institute contracts must beentered in accordance with the competitive biddingrequirements applicable to the University of California.(Pub. Contract Code, § 10500 et seq.) The rules andregulations that the ICOC adopts (other than interimregulations that were authorized for no more than 270days) must be adopted *1335 in accordance with theAdministrative Procedure Act (Gov.Code, § 11371 etseq.). (§ 125290.40, subd. (j).)

The Cures Act requires the ICOC to adopt standardsapplicable to all phases of its work, including“scientific and medical standards to carry out thespecific controls and intent of the act” that shall governthe **280 ICOC, its working committees and itsgrantees (§ 125290.35, subd. (a)), standards forobtaining the informed consent of research donors,patients or participants (id., subd. (b)(1)), standards forthe review of research involving human subjects (id.,subd. (b)(2)), standards prohibiting compensation toresearch donors or participants (id., subd. (b)(3)),standards to assure compliance with state and federal

patient privacy laws (id., subd. (b)(4)), standardslimiting payments for the purchase of stem cells or stemcell lines (id., subd. (b)(5)), and standards setting a limiton the time during which cells may be extracted fromblastocysts (id., subd. (b)(6)). While the ICOC hasbeen granted broad discretion in these areas, the CuresAct places numerous limitations on the exercise of thatdiscretion. The medical and scientific standards, forexample, must comply with Government Code section125315, concerning the information and options thatmust be provided to fertility treatment patients (§125290.35, subd. (a)) and the standards concerningprivacy must comply with state and federal privacylaws (id., subd. (b)(4)). Some of the standards mustinitially be generally based on standards of the NationalInstitutes of Health, “with modifications to adapt to themission and objectives of the institute.” (Id., subd.(b)(1), (2).) Other standards must comply with morespecific criteria set out in the statute. (Id., subd. (b)(3),(5), (6).) As discussed more fully below (see pp.303-04 & fn. 28, post.), the criteria that the Scientificand Medical Research Funding Working Group mustuse in evaluating grant and loan applications arespecified in the statute (§ 125290.60, subd. (c)). TheAct also provides guidelines and priorities for theappropriation and allocation of institute funding (§125290.70; see pp. 298-99, post ). In addition, theinstitute is subject to financial and public accountabilityprovisions, including the requirements that the instituteissue an annual public report of its activities that mustcontain specified information, and commission anannual independent financial audit that must bereviewed by the State Controller and by the Citizen'sFinancial Accountability Oversight Committee. (§125290.30.)

The Bond Act contains the statutory authorization andframework for issuing bonds, obtaining interimfinancing, and managing funds for the operation of theinstitute.FN12 Under section 125291.30, “[b]onds in thetotal *1336 amount of three billion dollars($3,000,000,000) ... or as much thereof as is necessary,may be issued and sold to provide a fund to be used forcarrying out the purposes expressed in this article....”The total amount of bonds that may be issued in acalendar year may not exceed $350,000,000, plusremaining permitted amounts from prior years. (§



125291.45, subd. (b).) The California Stem CellResearch and Cures Finance Committee (FinanceCommittee), which is chaired by the State Treasurerand also includes the State Controller, Director ofFinance, the CIRM chairperson and two additionalICOC members, is created “[s]olely for the purpose ofauthorizing the **281 issuance and sale, pursuant to theState General Obligation Bond Law, of the bonds andinterim debt authorized by this article....” (§125291.40.)

FN12. Section 125290.40, subdivision (n) ofthe Cures Act also authorizes the ICOC toaccept additional revenue and property,including gifts, royalties, interest andappropriations, that may be used tosupplement annual research grant funding andthe operations of the institute. Section125290.70 appropriates from the StateGeneral Fund $3 million “as a temporarystart-up loan” for “internal administrative andimplementation costs.” During the pendencyof this litigation, which has precluded theissuance of the bonds authorized by the BondAct, CIRM has received interim financing inthe form of a loan from the General Fund andthe sale of bond anticipation notes to privateindividuals and philanthropic foundations.

B. The Litigation

[1] On April 6, 2005, plaintiffs People's Advocate andNational Tax Limitation Foundation (collectively,People's Advocate) filed an action in the AlamedaCounty Superior Court against the ICOC and individualdefendants Robert Klein, as chairperson and interimpresident of the ICOC, Arnold Schwarzenegger, asGovernor of the State of California, Cruz Bustamante,as Lieutenant Governor, Phil Angelides, as Treasurer,and Steve Westley as Controller. FN13 The action seeksa declaratory judgment that the statutory components ofProposition 71 violate article XVI, section 3 of theCalifornia Constitution, which prohibits the state fromdisbursing state funds to entities not under the exclusivemanagement and control of the state. People'sAdvocate asserts that the ICOC, which is empowered to

disburse state funds through research grants and loans,is a private entity not under the exclusive managementand control of the state. The statute, the complaintalleges, “delegates the disbursal of huge sums of publicmoney to the unfettered discretion of an institutionwhose governing board and working groups areunaccountable to the public.”

FN13. The filing of the complaint followedthe denial without prejudice of a petition for awrit of mandate that People's Advocateoriginally filed in the California SupremeCourt. Defendants' request for judicial noticeof the writ documents is granted. People'sAdvocate later filed an amended complaintadding defendant Zach Hall, as interimpresident of the ICOC, and dismissingGovernor Schwarzenegger and LieutenantGovernor Bustamante.

On July 8, 2005, after the Finance Committee hadauthorized $3 billion in general obligation bonds,plaintiff California Family Bioethics Council, LLC (theCouncil) filed a complaint in the Sacramento CountySuperior Court against the institute, the FinanceCommittee and “all persons interested in the matter ofthe legality of Proposition 71 and validity of actions,bonds and financing of CIRM.” This reverse validationaction under *1337Code of Civil Procedure section863 challenges the constitutionality of Proposition 71and the validity of the proposed state general obligationbonds. The Council contends that Proposition 71violates the single-subject rule; that “ Proposition 71violated electoral due process by concealing from thevoters the true scope and meaning of the initiative andits true costs”; and that conflicts of interest inherent inthe Cures Act “violate fundamental principles ofrepresentative government, public policy andconstitutional due process of law, represent anunconstitutional award of privileges and immunities tothe ICOC members and their institutions, and violateexisting conflicts of interest statutes and the commonlaw.” The Council also made the contention advancedby People's Advocate that the statutory provisionsviolate article XVI, section 3 of the CaliforniaConstitution.



On August 4, 2005, the Alameda County SuperiorCourt transferred the Council's action to AlamedaCounty and consolidated it with the action filed byPeople's Advocate. The consolidated cases were triedbefore the court in February and March of 2006. Thecourt received extensive documentary evidence, pre-and posttrial briefs from all parties, and the testimonyof four witnesses. On May 12, the court issued athorough statement of decision and entered judgment infavor of the defendants, finding that “plaintiffs failed toshow that Proposition 71, the California Stem Cell**282 Research and Cures Initiative, is clearly,positively and unmistakably unconstitutional; thatProposition 71 and the bonds issued thereunder arevalid; and that plaintiffs did not meet their burden toobtain any of the declaratory and injunctive reliefsought in their complaints.” People's Advocate and theCouncil filed timely notices of appeal.

Discussion

Between the two appeals, appellants challenge both thevalidity of the initiative process by which Proposition71 was adopted, and the substantive validity of theprovisions that were thereby enacted. Appellantsdisclaim any intention to question “the merits or faultsof stem cell research” and we too shall avoid suchconsiderations. (See Amador Valley Joint Union HighSch. Dist. v. State Bd. of Equalization (1978) 22 Cal.3d208, 219, 149 Cal.Rptr. 239, 583 P.2d 1281 (Amador )[“We do not consider or weigh the economic or socialwisdom or general propriety of the initiative. Rather,our sole function is to evaluate [it] legally in light ofestablished constitutional standards.”].) After brieflyreviewing the applicable standard of review, we shallconsider first whether Proposition 71 violated theso-called single-subject rule and whether the ballotmaterials that accompanied the proposition *1338 weremisleading and invalidated the results of the election. We shall then turn to the several reasons for whichappellants contend that the statutory components of themeasure violate either the California Constitution orother provisions of law. Finally, we shall considerappellants' objections to the exclusion of certainevidence at trial.

A. Standard of Review

People's Advocate seeks a declaration that the CuresAct is unconstitutional and an order enjoining “effortsto organize or operate the ICOC” and prohibiting thenamed defendants “from spending or releasing anypublic funds for any purpose connected with or relatingto, the ICOC.” It also seeks to enjoin these defendants“from issuing, or causing to be issued, any bonds”under the Bond Act. The Council similarly seeks adeclaration that Proposition 71 is unlawful and an orderenjoining its enforcement.FN14

FN14. The Council requests an orderdeclaring that CIRM, the ICOC, andProposition 71 “on its face and as applied,violate California Constitutional, statutory andcommon law; that the unlawful andunconstitutional provisions of Proposition 71are not severable from the initiative as awhole”; that the “existence and operation ofthe CIRM and the ICOC are unlawful andunconstitutional; ... that the members of theICOC are disqualified from holding publicoffice on the ICOC board and that thechairperson and vice-chairperson aredisqualified to be employees of the CIRM”and that “actions of the defendants toimplement Proposition 71 and to fund andoperate the [CIRM and ICOC] ... are withoutlawful authority and invalid.” The Councilalso seeks an order enjoining the defendantsfrom “implementing Proposition 71,”enjoining “the CIRM, the ICOC and itsofficers and members from all operations,actions and exercise of legal authority underProposition 71,” and enjoining defendantsfrom raising or using any funds “for thebenefit of or to finance the activities of theCIRM or ICOC.”

[2][3][4][5][6] Appellants' challenges to the validity ofthe proposition and to the statutes enacted by theproposition present questions of law that are reviewedde novo. (CART, supra, 109 Cal.App.4th at p. 807, 135Cal.Rptr.2d 224.) “This reviewing court therefore



exercises its independent judgment, without deferenceto the trial court's ruling. [Citation.] [¶] We are guidedby established principles for evaluating theconstitutionality of initiative measures. We do notconsider or weigh the economic or social wisdom orgeneral **283 propriety of the initiative, but ratherevaluate its constitutionality in the context ofestablished constitutional standards. [Citation.] [¶]‘Although the legislative power under our stateConstitution is vested in the Legislature, “the peoplereserve to themselves the powers of initiative andreferendum.” [Citation.] Accordingly, the initiativepower must be liberally construed to promote thedemocratic process. [Citation.] Indeed, it is our solemnduty to jealously guard the precious initiative power,and to resolve any reasonable doubts in favor of itsexercise. [Citation.] As with statutes adopted by theLegislature, all presumptions favor the validity ofinitiative measures and mere doubts as to validity*1339 are insufficient; such measures must be upheldunless their unconstitutionality clearly, positively, andunmistakably appears.’ ” (Id. at pp. 807-808, 135Cal.Rptr.2d 224.)

[7] The Council asserts that it is challengingProposition 71 both facially and “as applied.” “A facialchallenge to the constitutional validity of a statute orordinance considers only the text of the measure itself,not its application to the particular circumstances of anindividual. [Citation] ‘ “To support a determination offacial unconstitutionality, voiding the statute as awhole, petitioners cannot prevail by suggesting that insome future hypothetical situation constitutionalproblems may possibly arise as to the particularapplication of the statute.... Rather, petitioners mustdemonstrate that the act's provisions inevitably pose apresent total and fatal conflict with applicableconstitutional prohibitions.” ’ ” (Tobe v. City of SantaAna (1995) 9 Cal.4th 1069, 1084, 40 Cal.Rptr.2d 402,892 P.2d 1145, italics omitted.)

[8] An “as applied” challenge seeks “relief from aspecific application of a facially valid statute ... to anindividual or class of individuals” or seeks to enjoin the“future application of the statute ... in the allegedlyimpermissible manner it is shown to have been appliedin the past.” (Tobe v. City of Santa Ana, supra, 9

Cal.4th at p. 1084, 40 Cal.Rptr.2d 402, 892 P.2d 1145.) The result of a successful as-applied challenge to aparticular statute is not the invalidation of the statute asa whole, but rather an order enjoining specific unlawfulapplication of the statute. (Id. at pp. 1084-1086, 40Cal.Rptr.2d 402, 892 P.2d 1145.) In general, acomplaint that seeks to “enjoin any application of theordinance to any person in any circumstance”constitutes a facial attack on the statute. (Id. at p. 1087,40 Cal.Rptr.2d 402, 892 P.2d 1145.) Here, the Councilchallenges the validity of the entire proposition andPeople's Advocate challenges the validity of the CuresAct. Neither complaint identifies a specific applicationof any provision that it seeks to enjoin. Accordingly,as the trial court concluded, both complaints should beconsidered as presenting facial challenges, either to theproposition or to the included Act.

Insofar as the trial court considered evidence withregard to the implementation of Proposition 71,including evidence of appointees' qualifications and theprocess by which training grants were awarded, thatevidence will be considered as providing context for theanalysis of the challenged statutory provisions. To theextent that the trial court made findings that the CuresAct has thus far been implemented in conformity withthe statute, those findings are subject to substantialevidence review. (See Board of Administration v.Wilson (1997) 52 Cal.App.4th 1109, 1127-1129, 61Cal.Rptr.2d 207; City and County of San Francisco v.Sainez (2000) 77 Cal.App.4th 1302, 1313, 92Cal.Rptr.2d 418.) However, appellants do notchallenge the sufficiency of the evidence to support thefindings and have not requested any form **284 ofrelief *1340 short of invalidating either the entireproposition or the Cures Act. Therefore, the primaryfocus of this court's review remains the facial validityof these measures.

B. The Adoption of Proposition 71

1. The Single-subject Rule

[9][10] The Council first argues that the proposition isinvalid because it was enacted by a ballot measure that



did not comply with the provision of the CaliforniaConstitution limiting initiatives to a single subjectmatter. “An initiative measure embracing more thanone subject may not be submitted to the electors or haveany effect.” (Cal. Const., art. II, § 8, subd. (d).) Thissingle-subject rule is designed “to avoid confusion ofeither voters or petition signers and to preventsubversion of the electorate's will.” (Senate of the Stateof Cal. v. Jones (1999) 21 Cal.4th 1142, 1156, 90Cal.Rptr.2d 810, 988 P.2d 1089 (Jones); CART, supra,109 Cal.App.4th at p. 809, 135 Cal.Rptr.2d 224.) “ ‘ “‘An initiative measure does not violate thesingle-subject requirement if, despite its variedcollateral effects, all of its parts are “reasonablygermane” to each other,’ and to the general purpose orobject of the initiative.” ' [Citation.] As we recentlyhave explained, ‘the single-subject provision does notrequire that each of the provisions of a measureeffectively interlock in a functional relationship. [Citation.] It is enough that the various provisions arereasonably related to a common theme or purpose.’[Citation.] Accordingly, we have upheld initiativemeasures ‘ “which fairly disclose a reasonable andcommon sense relationship among their variouscomponents in furtherance of a common purpose.” ’ ”(Jones, supra, 21 Cal.4th at p. 1157, 90 Cal.Rptr.2d810, 988 P.2d 1089, italics omitted.)

“[T]he initiative process occupies an important andfavored status in the California constitutional schemeand the single-subject requirement should not beinterpreted in an unduly narrow or restrictive fashionthat would preclude the use of the initiative process toaccomplish comprehensive, broad-based reform in aparticular area of public concern.” (Jones, supra, 21Cal.4th at p. 1157, 90 Cal.Rptr.2d 810, 988 P.2d 1089.) In evaluating a single-subject challenge to a measurethe court should not attempt “to predict whether eachsection actually will further the initiative's purpose. Instead, we inquire only whether the provisions are‘reasonably germane’ to the general purpose orobjective of the initiative.” (Calfarm Ins. Co. v.Deukmejian (1989) 48 Cal.3d 805, 841-842, 258Cal.Rptr. 161, 771 P.2d 1247.)

*1341 The Council relies heavily on two Court ofAppeal decisions that held initiative measures violated

the single-subject rule: California Trial Lawyers Assn.v. Eu (1988) 200 Cal.App.3d 351, 245 Cal.Rptr. 916(CTLA ) and Chemical Specialties ManufacturersAssn., Inc. v. Deukmejian (1991) 227 Cal.App.3d 663,278 Cal.Rptr. 128 (Chemical ). In CTLA the courtaddressed a ballot measure that was predominatelyaimed at controlling the cost of insurance. Oneprovision of the measure, however, would haveprotected insurance companies from laws regulatingcampaign contributions. The Court of Appeal held thatthe inclusion of this provision ran afoul of thesingle-subject rule. “First, the express purpose of theinitiative is to control the cost of insurance, notgenerally to regulate the practices of the insuranceindustry. Second, we cannot accept the impliedpremise of [the insurers'] analysis, i.e., that any twoprovisions, no matter how functionally unrelated,nevertheless comply with the constitution'ssingle-subject requirement so long as they have incommon an effect on any aspect of the business**285of insurance. Contemporary society is structured insuch a way that the need for and provision of insuranceagainst hazards and losses pervades virtually everyaspect of life. [The insurers'] approach would permitthe joining of enactments so disparate as to render theconstitutional single-subject limitation nugatory.”(CTLA, supra, at p. 360, 245 Cal.Rptr. 916.) The courtalso took issue with the fact that the provision regardingcampaign contributions was “located ... near the middleof a 120-page document, and consists of two briefparagraphs which bear no connection to what precedesor follows,” calling it “a paradigm of the potentiallydeceptive combination of unrelated provisions at whichthe constitutional limitation on the scope of initiativesis aimed.” (Ibid.)

In Chemical, the ballot measure was directed at publicdisclosure of information concerning household toxicproducts, seniors' health insurance, nursing homes,statewide initiative or referendum campaigns, and salesof stock or securities for corporations doing businesswith South Africa. The Court of Appeal rejected thecontention that the measure was aimed at “providingthe public with accurate information in advertising,”finding this articulation of the subject matter to be “sobroad that a virtually unlimited array of provisionscould be considered germane thereto and joined in this



proposition, essentially obliterating the constitutionalrequirement. [¶] In actuality, the measure seeks toreduce toxic pollution, protect seniors from fraud anddeceit in the issuance of insurance policies, raise thehealth and safety standards in nursing homes, preservethe integrity of the election process, and fight apartheid;well-intentioned objectives but not reasonably relatedto one another for purposes of the single-subject rule.”(Chemical, supra, 227 Cal.App.3d at p. 671, 278Cal.Rptr. 128.)

[11] The Council argues that “Proposition 71 violatesthe single-subject rule by authorizing not only stem cellresearch but also (a) authorizing research and *1342regulation concerning unspecified ‘other vital researchopportunities,’ (b) revising conflicts of interest laws andlegislating conflicts of interest exemptions, and (c)granting exclusive, executive, financial and regulatorypowers beyond the scope of stem cell research.” Inrejecting this contention, the trial court correctlyobserved, “The over-arching subject of Proposition 71is stem cell research and funding. The initiative'spurpose and intent includes funding stem cell research;setting standards for such research; and reducing thelong-term health care cost in California through thedevelopment of therapies that treat diseases with theultimate goal to cure them. In addition, the initiative'sintent is to benefit the California economy by creatingjobs and advancing the biotech industry through suchresearch. The ICOC oversees the research, withrepresentatives of [the University of California (U.C.)]and other California universities with medical researchinstitutions, disease advocacy groups, and experts in thedevelopment of medical therapies.” The trial courtconcluded that “the subjects [the Council] arguesviolate the single subject rule are reasonablyinterrelated and do not violate the rule,” aptly citingAmador, supra, 22 Cal.3d at page 231, 149 Cal.Rptr.239, 583 P.2d 1281.FN15

FN15. In that case, our Supreme Court upheldthe validity of Proposition 13 on the June1978 ballot, also known as the “Jarvis-GannProperty Tax initiative,” which added articleXIII A to the California Constitution. Thecourt rejected the contention that the four

major elements of the provision (a realproperty tax rate limitation, a real propertyassessment limitation, a restriction on statetaxes, and a restriction on local taxes)constitute separate subjects, reasoning that“each of them is reasonably interrelated andinterdependent, forming an interlocking‘package’ deemed necessary by the initiative'sframers to assure effective real property taxrelief.” (Amador, supra, 22 Cal.3d at p. 231,149 Cal.Rptr. 239, 583 P.2d 1281.)

**286 Turning to the specific reasons for which theCouncil asserts that Proposition 71 covers more thanone subject matter, the Council first points to theprovision authorizing the institute to “make grants andloans for stem cell research, for research facilities, andfor other vital research opportunities to realizetherapies, protocols, and/or medical procedures that willresult in, as speedily as possible, the cure for, and/orsubstantial mitigation of, major diseases, injuries, andorphan diseases.” FN16 (Cal. Const., art. XXXV, § 2,italics added.) The Council argues that by allowing forbroadly defined “other vital research,” the Cures Actcovers not only stem cell research but other researchthat is not aimed at regenerative technologies.

FN16. Article XXXV, section 2 of theCalifornia Constitution is quoted in full onpage 276, ante. Section 125292.10,subdivision (y) of the Cures Act defines a“vital research opportunity” as “scientific andmedical research and technologies and/or anystem cell research not actually funded by theinstitute under subparagraph (C) of paragraph(1) of subdivision (c) of Section 125290.60which provides a substantially superiorresearch opportunity vital to advance medicalscience as determined by at least a two-thirdsvote of a quorum of the members of theScientific and Medical Research FundingWorking Group and recommended as such bythat working group to the ICOC. Humanreproductive cloning shall not be a vitalresearch opportunity.”



*1343 The trial court concluded that funding “othervital research opportunities” is “germane and related tothe other provisions of the [Cures] Act in that it islimited to funding only those opportunities ‘that willresult in’ the types of cures sought by the Act.”(Quoting Cal. Const., art. XXXV, § 2, subd. (a).) TheCouncil argues that this analysis impermissiblyredefines the subject of Proposition 71 in general termsof scientific or medical research, rather than itsprofessed subject of stem cell research. However, weagree with the Attorney General that the terminology inthe measure to which the Council refers does not permitresearch “over anything and everything that the ICOCdecides may ‘advance medical science.’ ” Themeasure is plainly directed to research for which “thefederal government is not providing adequate fundingnecessary for the urgent research and facilities neededto develop stem cell therapies to treat and cure diseasesand serious injuries.” (Prop.71, § 2.) In order to ensurethat institute funding does not duplicate or supplantexisting funding, “a high priority shall be placed onfunding pluripotent stem cell and progenitor cellresearch that cannot, or is unlikely to, receive timely orsufficient federal funding, unencumbered by limitationsthat would impede the research. In this regard, otherresearch categories funded by the National Institutes ofHealth shall not be funded by the institute.” (§125290.60, subd. (c)(1)(C).) Other “vital researchopportunities” are sanctioned, as the definition of thatphrase clarifies (see fn. 16, ante ), to permit the ICOCnonetheless to authorize, upon approval of asupermajority of the Scientific and Medical ResearchFunding Working Group, research that may also befederally funded if within the stated purposes of theinitiative.FN17

FN17. Section 125290.60, subdivision(c)(1)(D) identically provides thatnotwithstanding subdivision (c)(1)(C), “otherscientific and medical research andtechnologies and/or any stem cell researchproposal not actually funded by the instituteunder subparagraph (C) may be funded by theinstitute if at least two-thirds of a quorum ofthe members of the Scientific and MedicalResearch Funding Working Group

recommend to the ICOC that such a researchproposal is a vital research opportunity.”

**287 Research into stem cell therapy is in its infancy. As the understanding of the biology and biochemistryof stem cells expands it is to be expected that researchwill draw upon and overlap with studies in relatedfields of medicine, science, and technology. Theauthors of Proposition 71 understandably did not wishto create artificial barriers and limitations to theresearch that can be pursued in developing treatmentsand cures arising from the stem cell research. Research into related fields of medicine, science, andtechnology that will increase the understanding andfacilitate the use of stem cell therapies quite clearly isboth functionally related and reasonably germane to thestem cell research itself, whether or not additionalfederal funding becomes available. Far from creatinga scattered and varied agenda united only by a vagueand broad generalization, as was the measure in*1344Chemical, supra, 227 Cal.App.3d 663, 278Cal.Rptr. 128, Proposition 71 authorizes research thatis as specific as the circumstances permit and isreasonably limited to a single subject.

Moreover, the findings and declarations that appear inthe opening provisions of Proposition 71 state that theCures Act “will close [the federal] funding gap byestablishing an institute which will issue bonds tosupport stem cell research, emphasizing pluripotentstem cell and progenitor cell research and other vitalmedical technologies, for the development oflife-saving regenerative medical treatments and cures.”(Prop. 71, § 2, italics added.) The analysis by theLegislative Analyst included in the November 2, 2004Voter Information Guide explained, under the heading“How Funding Would Be Spent,” that “[p]riority forresearch grant funding would be given to stem cellresearch that met the institute's criteria and was unlikelyto receive federal funding. In some cases funding couldalso be provided for other types of research that weredetermined to cure or provide new types of treatment ofdiseases and injuries.” (Italics added.) Rather thanbeing hidden from the eye of the average voter, as wasthe objectionable provision in CTLA, supra, 200Cal.App.3d 351, 245 Cal.Rptr. 916, the inclusion ofresearch into related medical technologies was



explicitly addressed in the summary presented to thevoters. This disclosure “dilute[s] the risk of voterconfusion or deception,” one fundamental purpose ofthe single subject rule, and further militates in supportof the validity of the measure. (Amador, supra, 22Cal.3d at p. 231, 149 Cal.Rptr. 239, 583 P.2d 1281;Shea Homes Limited Partnership v. County of Alameda(2003) 110 Cal.App.4th 1246, 1257, 2 Cal.Rptr.3d739.)

The Council next argues that the provisions added tothe Health and Safety Code by Proposition 71 run afoulof the single-subject rule because the Cures Act“revises the application of conflicts of interest laws andspecifically seeks to exempt the members of the ICOCfrom their conflicts of interest.” The manner in whichthe Act qualifies and clarifies conflict of interestrestrictions for members of the ICOC is described atpages 306-07, post. As indicated above, the Act alsoimposes rigorous qualifications for those who mayserve on the ICOC and its working groups. Theobvious intent is to require that those responsible forparticipating in the decisionmaking process andallocating research funds be knowledgeable in theapplicable fields of science and medicine. Given theobjective of delegating to persons knowledgeable in therelevant fields the advisory and decisionmakingresponsibilities for the highly technical work of theinstitute, and **288 the demanding qualifications formembership in the various arms of the institute, it isreadily apparent why the conflict of interest provisionsare both functionally related and reasonably germane tothe single subject of the research authorized to befunded by Proposition 71. Persons qualified to servein the various positions created by the measure arelikely affiliated in some manner with institutions thatdirectly or indirectly will participate in or be affectedby research *1345 underwritten by the institute. Theneed to adapt, or at least to clarify, conflict of interestrules that otherwise might disqualify or be perceived todisqualify many of the people on whose expertise thefunctioning of the institute will depend provides amplejustification directly related to the objectives of theinstitute for the conflict provisions. Broadening thepool of qualified candidates from which the ICOC maydraw unquestionably is functionally related to the singlepurpose of the stem cell research and cures initiative.

Again relying on CTLA, supra, 200 Cal.App.3d 351,245 Cal.Rptr. 916, the Council argues, “An insuranceinitiative that contained a single-sentence statutoryexemption from only one conflicts of interest lawviolated the single-subject rule and was heldunconstitutional....” The court's objection to theinsurance measure in CTLA, however, was not the factthat the initiative contained a conflict waiver. Thecourt objected to the fact that the conflict of interestprovision was hidden in the middle of a lengthyinitiative and dealt not with the regulation of insurancerates as the rest of the measure did, but with exemptinginsurers and others from laws regulating campaigncontributions, a subject unrelated but for the fact thatboth pertained to insurance carriers. CTLA did notdisturb the basic proposition that a measure does notviolate the single-subject rule if its provisions are“either functionally related to one another or ...reasonably germane to one another or the objects of theenactments” (Harbor v. Deukmejian (1987) 43 Cal.3d1078, 1100, 240 Cal.Rptr. 569, 742 P.2d 1290), as theconflict provisions in this measure plainly are.FN18

FN18. The Council also argues, withoutcitation to authority, that “Waiver of conflictsof interest can only be argued to be germaneto Proposition 71 if supported by evidence thatwithout waiving conflicts of interest it wouldnot be reasonably possible to appoint qualifiedboard members of the ICOC.” However, thereis no need for such evidence to establish alogical nexus between the conflict of interestprovisions and the purpose of the Act.Moreover, the very next argument in theCouncil's brief-that ICOC members aresubject to conflicts of interest under otherprovisions of California law-confirms thefunctional importance of the provisions in theAct qualifying those other provisions.

Finally, the Council argues that the proposition“violates the single-subject rule by the extensive rangeof subjects over which the ICOC is granted exclusivestate authority.” The Council points to the fact thatprovisions of the measure relate to the regulation ofmedical research, technical and funding standards,



conflicts of interest, privacy rights of women and otherrelated ethical questions, bond financing, and licensingof intellectual property rights. In particular, theCouncil quotes section 125290.35, subdivision (a),which provides, “In order to avoid duplication orconflicts in technical standards for scientific andmedical research, with alternative state programs, theinstitute will develop its own scientific and medicalstandards to carry out the specific controls and intent ofthe act, notwithstanding subdivision (b) of section125300, sections 125320, 125118, 125118.5, *1346125119, 125119.3 and 125119.5, or any other currentor future state laws or regulations dealing with thestudy and research of pluripotent stem **289 cellsand/or progenitor cells, or other vital researchopportunities, except Section 125315. The ICOC, itsworking committees, and its grantees shall be governedsolely by the provisions of this act in the establishmentof standards, the award of grants, and the conduct ofgrants awarded pursuant to this act.” (Italics added bythe Council's brief.)

As in the trial court, the Council fails to explain how orwhy these provisions violate the single-subject rule. On their face, all appear directly germane to the singleresearch mission of the institute created by theproposition. Medical and ethical standards clearly areappropriate, if not indispensable, for this new andsensitive area of research, which has given rise tointense moral concerns among a portion of the publicand has led to the federal restrictions that this measureseeks to overcome. Protecting the privacy rights ofstem cell donors unquestionably is within the samepurview. As just noted, particularized conflict ofinterest standards for those members of the medical andscientific community who will authorize and overseethe research projects are designed to advance theresearch mission of the institute. Bond financing is themeans provided by the measure to raise the fundsnecessary to implement the institute's mission. Andappropriate licensing and regulation of the intellectualproperty that is anticipated from the work of theinstitute is similarly germane and functionally related tothe conduct of the research. There is undoubtedly “ ‘“a reasonable and common sense relationship among[the] various components in furtherance of a commonpurpose” ’ ” of all of the provisions that make up

Proposition 71. (Jones, supra, 21 Cal.4th at p. 1157, 90Cal.Rptr.2d 810, 988 P.2d 1089, italics omitted; seealso Manduley v. Superior Court (2002) 27 Cal.4th 537,576-579, 117 Cal.Rptr.2d 168, 41 P.3d 3 [initiativeamending statutes regarding gang-related crime,sentencing of repeat offenders, and juvenile justicesystem did not violate single-subject requirement. Challenged provisions regarding repeat offenders bore“both a topical and a functional relationship toprovisions regarding juvenile crime”].)

In short, as the trial court concluded, the Council “hasnot demonstrated that Proposition 71 violates theconstitutional provision that an initiative must belimited to a single subject.”

2. The Proposition 71 Ballot Materials Were NotMisleading

[12] The Council argues that “Proposition 71 containsmaterial omissions and misrepresentations that causedits adoption in the November 2004 election to violatedue process of law.” The Council contends that theanalysis provided in the ballot materials by theLegislative Analyst was misleading because it misstatedthe interest costs on the bonds that were authorized,falsely *1347 promised new revenues from medicaltherapies to be developed, and failed to define the terms“somatic cell nuclear transfer,” “products of in vitrofertilization treatments,” and “cloning.” The Councilalso argues that the analysis “fails to explain that theinitiative is establishing a state public agency whosemembers are being exempted from conflicts of interestlaws.”

At the outset, the Council's challenge must bedistinguished from a pre-election challenge based onviolation of election laws. Except for challengesalleging misconduct rising to the level of aconstitutional violation, “the court's authority toinvalidate an election is limited to the bases for contestspecified in Elections Code section 16100 and thatsection is exclusive.” **290(Friends of Sierra Madrev. City of Sierra Madre (2001) 25 Cal.4th 165, 192,105 Cal.Rptr.2d 214, 19 P.3d 567 (Friends of SierraMadre ).) Quoting Horwath v. City of East Palo Alto



(1989) 212 Cal.App.3d 766, 777, 261 Cal.Rptr. 108(Horwath ), the Council argues that the alleged flaws itidentifies in the ballot materials rendered “theinformation provided to the voters ... ‘inaccurate ormisleading as to prevent the voters from makinginformed choices.’ ” The misleading information, theCouncil reasons, amounts to a denial of due process.

Horwath held that “Determination of how much processis due in a local, direct decisionmaking context-wherethe complained-of irregularities consist of omissions,inaccuracies or misleading statements in the ballotmaterials-will depend on whether the materials, in lightof other circumstances of the election, were soinaccurate or misleading as to prevent the voters frommaking informed choices. In conducting this inquirycourts should examine the extent of preelectionpublicity, canvassing and other informational activities,as well as the substance or content of such efforts. Theready availability of the text of the ordinance, or theofficial dissemination and content of other relatedmaterials, such as arguments for or against the measure,will also bear on whether the statutory noncompliancerendered the election unfair. Finally, courts shouldtake into account the materiality of the ommission [sic] or other informational deficiency. Flaws striking atthe very nature and purpose of the legislation are moreserious than other, more ancillary matters.” (Horwath,supra, 212 Cal.App.3d at pp. 777-778, 261 Cal.Rptr.108.)

In People ex rel. Kerr v. County of Orange (2003) 106Cal.App.4th 914, 131 Cal.Rptr.2d 274 (Kerr ) the courtaddressed a challenge to an election adopting a countycharter, which was similar to the challenge made here. The plaintiffs argued that “the alleged deficiencies inthe impartial analysis here are a violation ofconstitutional guarantees of due process. As they putit in their brief, the right to vote is ‘fundamental in ademocratic society’ and the impartial analysis, ‘byconveying false and misleading information’ abridgedthat right by preventing ‘voters from making an *1348informed decision....’ ” (Id. at p. 933, 131 Cal.Rptr.2d274.) The court responded that “plaintiffs' logicsweeps too broadly. Election losers frequently claimthat their message ‘didn't get out’ or that they were thevictims of ‘false and misleading information.’ Simply

as a matter of general principle, the idea that by‘constitutionalizing’ deficiencies in voter summariesyou can undo an election is really quite antithetical tothe democratic process.” (Ibid.) The court concludedthat the plaintiffs were attempting to circumvent thestatutory requirement that challenges to an impartialanalysis be brought before the election is held. “[T]heneed to mount any challenges to an impartial analysisbefore an election takes place and not after it cannot beso easily sidestepped as plaintiffs here would have usimagine. A litigant cannot simply intone the words‘due process' and make the problem go away. Here,substantively, plaintiffs have really mounted only anelection challenge, not a constitutional challenge (atleast insofar as they attack the impartial analysis). [¶]We need only add that in light of the fact that theLegislature has determined in the Election Code that anelection cannot be undone on the basis of allegeddeficiencies in an impartial analysis, trying to achievethe same result under the rubric of constitutional dueprocess, as was unsuccessfully attempted in Horwath,requires a showing that the impartial analysisprofoundly misled the electorate, not just that it didn'teducate the electorate as to all the legal nuances of**291 the measure. We perceive in Friends of SierraMadre and Horwath, when read together, that the bar isvery high indeed for a litigant to successfully mount apost-election challenge to a ballot measure using a dueprocess rationale based on defects in a county counsel'simpartial analysis.” (Id. at pp. 933-934, 131Cal.Rptr.2d 274.)

Like the plaintiffs in Kerr, the Council not only doesnot clear this bar, it “barely even get[s] off the ground.”(Kerr, supra, 106 Cal.App.4th at p. 934, 131Cal.Rptr.2d 274.) The Council first argues that theballot materials represented that the interest costs forrepayment of the bonds would be $3 billion, while “[i]nfact the State Treasurer estimates that the true cost ofthe interest on the Proposition 71 bonds will be anadditional $423 million.” The Legislative Analyst'ssummary predicted a “[s]tate cost of about $6 billionover 30 years to pay off both the principal ($3 billion)and interest ($3 billion) on the bonds.” The October26, 2005 letter from the State Treasurer to the presidentof the CIRM, on which the Council relies, points outthat the measure authorizes both taxable and



tax-exempt bonds, which “gives the Institute theflexibility to design a research strategy to meet itsobjectives at the lowest cost to the taxpayers and inways that comply with any federal restrictions on theuse of tax-exempt bonds.” The letter explains that,although the state may not be able use tax-exemptbonds to finance research projects in which the statewould benefit by receiving royalties from the fruits ofthe research, the matter is far from settled law and thatthe financing options should be further explored. TheTreasurer further stated that in some circumstances itmight be *1349 more beneficial to the state to usetaxable bonds since the royalties could exceed theadditional costs of these bonds. “My staff estimatesthat the interest rate difference between issuing taxableand tax-exempt 30-year general obligation bonds iscurrently about 0.75 percentage points. Even in theworst-case scenario-where, to obtain royalties, the Statemust sell only taxable bonds to fund the Institute'sentire research grant program-my staff estimates thatthe added interest cost to the State over the 30-yearterm of the bonds would be $423 million. By contrast,the economic study released by the Proposition 71campaign last year estimated that the Institute couldreasonably expect to receive as much as $1.1 billion inlicensing fees and royalties over the next three decades. If that is the case, even the maximum use of taxablebonds would result in $677 million more in netrevenues to the State and its taxpayers than if theInstitute uses only tax-exempt financing and forgoesany royalties.”

The trial court concluded that there was “no evidence ofmisleading financial projections.” The trial court iscorrect. There is nothing in the Treasurer's letter thatcontradicts the Legislative Analyst's estimate. First,the Treasurer's figure is based on the assumption thatthe state will sell only taxable bonds. The state maysell tax-free bonds, taxable bonds, or a combination ofboth. The Treasurer's letter adeptly outlines theconsiderations for each option but does not establishthat the state will pay more than was estimated in theballot materials for the bonds. Moreover, the $3 billionfigure provided in the ballot materials is explicitly anestimate, not a firm figure. The analysis states, “If the$3 billion in bonds authorized by this measure wererepaid over a 30-year period at an average interest rate

of 5.25 percent, the cost to the General Fund would beapproximately $6 billion to pay off both the principal($3 billion) and interest ($3 billion).” (Italics added.) This statement cannot reasonably be read to mean thatthis would be the exact cost of **292 repayment, sinceinterest rates fluctuate and the state might choose to sellbonds with a different term for repayment. TheCouncil does not suggest that the state cannot exerciseits right under the Cures Act to sell both tax-free andtaxable bonds, which of course would change the costof the bonds. The trial court was correct that theTreasurer's “letter indicates that over the life of thebonds at issue the interest cost of taxable bonds wouldbe $423 million more than the cost of tax-free bonds,but says nothing whatsoever about the LegislativeAnalyst's projection of $3 billion in interest costs.”

The Council next argues that Proposition 71 falsely“represented to the voters that the initiative would‘Protect and benefit the California budget ... by fundingscientific and medical research that will significantlyreduce state health care costs in the future.’ ” (Italics inthe Council's brief.) The Council argues that this ismisleading because “[t]here is no way to know whetheror not any Proposition 71 funded research will everresult in any revenues or any health care cost savings tothe State.” The Council also complains that *1350 anyroyalty payments to the state from technologydeveloped under the auspices of the institute arespeculative. The trial court concluded that thestatement to which the Council objects was not apromise but “is an aspiration on the part of the peopleof the state to ‘[p]rotect and benefit the state budget.’ ”

As the Attorney General observes, the ballot materialsrepeatedly stressed the speculative nature of anysavings from research or earnings to the state fromlicensing royalties under the Cures Act. The summaryof the Legislative Analyst's estimate of fiscal impact,which appeared in the voter information guide beforethe full analysis, referred to “Unknown potential stateand local revenue gains and cost savings to the extentthat the research projects funded by this measure resultin additional economic activity and reduced publichealth care costs.” In the fuller discussion of fiscaleffects, under the heading “Other Potential FiscalEffects,” the analysis stated: “If the measure were to



result in economic or other benefits that would nototherwise have occurred, it could produce unknownindirect state and local revenue gains and cost savings. Such effects could result, for example, if the addedresearch activity and associated investments due to themeasure generate net gains in jobs and taxable income,or if funded projects reduce the costs of health care togovernment employees and recipients of state services. The likelihood and magnitude of these and otherpotential indirect fiscal effects are unknown.” (Italicsadded.) Such speculation, phrased in conditionallanguage as this was, is not misleading, let alonemisleading to the degree that would “prevent the votersfrom making informed choices.” (Horwath, supra, 212Cal.App.3d at p. 777, 261 Cal.Rptr. 108.) FN19

FN19. The Council also argues that the ballotmeasure violated state law governing theoffering of securities, citing CorporationsCode section 25401, because it “would work‘a fraud upon the electors through securingtheir votes for the approval of these bondissues upon terms and conditions which willnot be kept.’ ” As indicated above, nothing inthe analysis constituted a promise, let alone aterm or condition for return on sale of thebonds.

The Council also argues that the analysis failed “toexplain the meanings of critical scientific terms usedbut not defined in Proposition 71, ‘somatic cell nucleartransfer,’ ‘products of in vitro fertilization treatments'and ‘cloning’ that is authorized under Proposition 71, ascontrasted to ‘human reproductive cloning,’ which is**293 banned....” (Original italics.) In consideringwhether these omissions materially misled voters, thecourt considers not only the text of the measure and theanalysis but also “the extent of preelection publicity,canvassing and other informational activities, as well asthe substance or content of such efforts.” (Horwath,supra, 212 Cal.App.3d at p. 777, 261 Cal.Rptr. 108.)

*1351 The court in Amador, supra, 22 Cal.3d 208, 149Cal.Rptr. 239, 583 P.2d 1281 considered a similarchallenge to a ballot summary by the AttorneyGeneral.FN20 The court noted “that the title and

summary need not contain a complete catalogue orindex of all of the measure's provisions ...” and that“[a]s a general rule, the title and summary prepared bythe Attorney General are presumed accurate, andsubstantial compliance with the ‘chief purpose andpoints' provision is sufficient.” (Id. at p. 243, 149Cal.Rptr. 239, 583 P.2d 1281.) In that case theplaintiffs complained that the title and summary omittedthe fact that a two-thirds majority vote was required forlocal entities to impose the “special taxes” authorizedby the measure. The court held that “[t]he summary'somission of any reference to the two-thirds voterequirement was not critical for, as we noted above, theinitiative measure was extensively publicized anddebated, in all of its several aspects, and a correctedsummary was contained in the voters pamphlet whichwas mailed to all voters. We repeat our observation ofsome time ago that we ordinarily should assume that thevoters who approved a constitutional amendment ‘...have voted intelligently upon an amendment to theirorganic law, the whole text of which was supplied eachof them prior to the election and which they must beassumed to have duly considered.’ ” (Id. at pp.243-244, 149 Cal.Rptr. 239, 583 P.2d 1281.)

FN20. Although Amador dealt with theAttorney General's title and summary, thesame principles are applied in reviewing theLegislative Analyst's analysis. (See Horneff v.City & County of San Francisco (2003) 110Cal.App.4th 814, 820, 2 Cal.Rptr.3d 79, fn. 4 (Horneff ).)

To say that the issues surrounding Proposition 71 andthe issues surrounding stem cell research generallywere well-aired prior to the election undoubtedly wouldbe an understatement.FN21 Though many votersprobably do not understand the science underlyingsomatic cell nuclear transfer, therapeutic cloning, andin vitro fertilization, they are not required to grasp theintricacies of this research frontier to intelligentlydecide whether to support a measure providing fundingfor such research. The ballot materials included a boxentitled “Stem Cells and Stem Cell Research” thatprovided objective nontechnical answers to threequestions: “What Are Stem Cells?,” “What are



Embryonic and Adult Stem Cells?,” and “Why doResearchers Want to Study Stem Cells?” No more wasrequired to permit voters to vote intelligently. (See**294Kerr, supra, 106 Cal.App.4th at p. 934, 131Cal.Rptr.2d 274 [unnecessary “to educate the *1352electorate as to all the legal nuances of the measure”];Elec.Code, § 9087 [analysis by Legislative Analyst“shall avoid the use of technical terms whereverpossible”].)

FN21. (See, e.g., Silfen, How Will California'sFunding of Stem Cell Research ImpactInnovation? (2005) 18 Harv. J. of Law &Technology 459, 468-469 [“Stem cell researchhas generated enormous controversy over thepast decade. Some believe stem cells holdpromise for developing therapies and cures forspinal cord injuries and conditions such asAlzheimer's disease, Parkinson's disease, anddiabetes. For others, however, the idea ofgenerating embryonic clones only to harvestthem is troubling, evoking hot-button issueslike reproductive cloning and abortion. Political pressures have prevented stem cellresearch from receiving federal funding forany work in which a human embryo isdestroyed. The issue has featuredprominently in the past two presidentialelections, with candidates and activistscausing political uproar by applying pro-liferhetoric to the stem cell debate”], fn. omitted.)

Finally, the Council again broaches the subject ofconflict of interest, arguing that voters were materiallymisled because the analysis “fails to explain that theinitiative is establishing a state public agency whosemembers are being exempted from conflicts of interestlaws.” However, without explicitly discussing thesubject of conflicts of interest, the analysis of theLegislative Analyst in the ballot pamphlet pointed outthat the ICOC would be “comprised of representativesof specified UC campuses, another public or privateCalifornia university, nonprofit academic and medicalresearch institutions, companies with expertise indeveloping medical therapies, and disease researchadvocacy groups.” Elections Code section 9087

provides that “The Legislative Analyst shall prepare animpartial analysis of the measure describing themeasure and including a fiscal analysis of the measureshowing the amount of any increase or decrease inrevenue or cost to state or local government,” that theanalysis “be written in clear and concise terms, so as tobe easily understood by the average voter ...” and thatit “generally set forth in an impartial manner theinformation the average voter needs to adequatelyunderstand the measure.” “The test is not whether thedigest is complete, but rather whether it contains ‘astatement of the major objectives or “chief purposesand points” of the measure.’ [Citation.] It need notrefer to ‘ “auxiliary or subsidiary” ’ matters, nor need it‘ “contain a summary or index of all of the measure'sprovisions.... Moreover, ‘ “substantial compliance” issufficient, and if reasonable minds may differ as to thesufficiency of the summary, it should be heldsufficient.’ ” (Horneff, supra, 110 Cal.App.4th at p.820, 2 Cal.Rptr.3d 79.) As in Kerr and Horneff, theimpartial statement here set forth the major features ofthe proposition and substantially complied with thestatutory requirements. For those voters seeking toascertain all of the details of the measure, the voterinformation guide contains the complete text of theproposition. Requiring the Legislative Analyst toinclude every facet of a complex measure such asProposition 71 would have the paradoxical effect ofrendering the analysis nearly as impenetrable to theaverage voter as the text of the proposition itself.

In short, the Council attacks the analysis on grounds allof which were available prior to the election. Here, asin Kerr and the cases upon which it relies, the Councilhas “really mounted only an election challenge, not aconstitutional challenge (at least insofar as they attackthe impartial analysis).” (Kerr, supra, 106 Cal.App.4that p. 934, 131 Cal.Rptr.2d 274.) The ballot materialsneither misled nor denied anyone due process nor dothey provide any basis for invalidating Proposition 71.

*1353 C. The Content of Proposition 71

1. The Cures Act Does Not Violate the ConstitutionalProhibition of Public Funding of Entities Outside of

the State's Exclusive Management and Control.



[13] Article XVI, section 3 of the CaliforniaConstitution provides: “No money shall ever beappropriated or drawn from the State Treasury for thepurpose or benefit of any corporation, association,asylum, hospital, or any other institution not under theexclusive management and control of the State as astate institution....” This constitutional prohibition wasdesigned “to prevent the appropriation of the moneys ofthe state for any purpose other **295 than that whichpertains to the state.” (County of Sacramento v.Chambers (1917) 33 Cal.App. 142, 146, 164 P. 613.) However, it was “not intended to unduly restrict thestate in the expenditure of public funds for legitimatestate purposes.” (People v. Honig (1996) 48Cal.App.4th 289, 352, 55 Cal.Rptr.2d 555.) “[A]rticleXVI, section 3 has been interpreted not to prohibitlegislative authorization for some degree of autonomyin a government agency or innovation in the manner inwhich a government agency operates, but rather toprevent the appropriation of funds from the state fiscfor a purpose foreign to the interests of the state andoutside of its control.” (CART, supra, 109 Cal.App.4that p. 816, 135 Cal.Rptr.2d 224.)

As indicated above, CIRM is an entity created by theConstitution itself. In this respect it differs from thestatutorily created entities that were the subject ofscrutiny in CART, in Howard Jarvis Taxpayers' Assn.v. Fresno Metropolitan Projects Authority (1995) 40Cal.App.4th 1359, 48 Cal.Rptr.2d 269 (Jarvis ), and inall of the cases that have considered the meaning ofarticle XVI, section 3. People's Advocate recognizesthat CIRM is “a creature of the Constitution andestablished in state government.” It statesunequivocally, “People's Advocate makes no challengeto the constitutional legitimacy of the CIRM, nor itspower to use bonds to fund its operations.” Itcontends, however, that “CIRM's role is basicallyministerial,” that the significant decisions to makegrants and loans are made by the ICOC, and that theauthority conferred by the Cures Act on the ICOCcontravenes article XVI, section 3 because the ICOC isempowered to disburse state funds without being underthe exclusive management and control of the state. But, as the trial court correctly observed, the ICOC “is

not a discrete entity, separate and apart from CIRM, butrather its governing body.” FN22 The actions approvedby the ICOC are the actions of CIRM. Thus, *1354People's Advocate is plainly wrong in arguing that “[t]othe extent that there is any state management andcontrol over CIRM, it has no significance to theconstitutional question raised here.”

FN22. This type of organizational structure isnot unique. (See Health & Saf.Code, § 51614,subd. (a) [Cal. Housing Finance Agency“vested with full power, authority, andjurisdiction” over Cal. Housing LoanInsurance Fund]; Ins.Code, § 11781 [“Theboard of directors is hereby vested with fullpower, authority and jurisdiction over theState Compensation Insurance Fund”]; seealso People v. San Joaquin etc. Assoc. (1907)151 Cal. 797, 801, 91 P. 740 [legislation“declaring the state agricultural society to bea state institution, organizing the state boardof agriculture and charging it with theexclusive management and control of the stateagricultural society as a state institution” isconstitutional].)

Whether viewed as management and control overCIRM or over the ICOC, and without consideringwhether as a constitutionally created organ of stategovernment CIRM necessarily provides statemanagement and control (cf. Wilson v. State Bd. ofEducation (1999) 75 Cal.App.4th 1125, 1135, 89Cal.Rptr.2d 745), the limits that the Cures Act placeson the operations of the institute are consistent with therequirements of article XVI, section 3. “Whether anentity is under the exclusive management and control ofthe state is determined through a case-specificevaluation of the applicable executive and legislativecontrols. [Citations.] However, the required exclusivecontrol permits the Legislature or the electorate to fundentities that are provided a degree of flexibility andoperational independence that encourages thedevelopment of innovative practices throughexperimentation with the objective of satisfying theunderlying **296 state purpose. [Citation.] It appearsthat exclusive management and control by the state



means the existence of sufficient controls over thecommissions by the executive and legislative branchesof the state government to assure that state funds areused to further state purposes without unduly inhibitinginnovative programs that serve those purposes.”(CART, supra, 109 Cal.App.4th at pp. 816-817, 135Cal.Rptr.2d 224.)

The trial court correctly found that sufficient statecontrols exist within the statutory framework. First,elected officials of both the legislative and executivebranches of government appoint or nominate 24 of the29 members of the ICOC, and five are appointed by thechancellors of University of California campuses. Thismethod of selection by public officials who arethemselves accountable to the public is a significantassurance of state accountability. (CART, supra, 109Cal.App.4th at pp. 817, 820-821, 135 Cal.Rptr.2d 224;Board of Directors v. Nye (1908) 8 Cal.App. 527,532-533, 97 P. 208.) We do not read article XVI,section 3, or CART, or any other decision to require thatall members of the governing board be appointed by anelected official in order to pass constitutional muster. And the fact that there is no power of removal by theappointing officials does not diminish the sufficiency ofthe state's control. In CART, the court rejected a claimthat the requisite accountability was absent because, ashere, the appointing officers have no power of removaland the appointees serve fixed terms and not at thepleasure of the appointing authority. The court pointed*1355 out, “ This feature is not unique. Commissioners of other state agencies do not serve atthe pleasure of their appointing authority. (See, e.g.,California Medical Assistance Commission [Welf. &Inst.Code, § 14165.2], State Commission on TeacherCredentialing [Ed.Code, § 44213], Student AidCommission [Ed.Code, § 69511], and Fair Employmentand Housing Commission [Gov.Code, § 12903].) Moreover, the Attorney General can initiate an actionto remove a ... member for failing to discharge his orher duties, incapacity, or conviction of a felony. (CodeCiv. Proc., § 803; Gov.Code §§ 1770, 3000.)” (CART,supra, 109 Cal.App.4th at p. 822, fn. 14, 135Cal.Rptr.2d 224.) FN23

FN23. It may well be, as People's Advocate

argues, that removal from office cannot beobtained under Code of Civil Proceduresection 803 because a member votes for anexpenditure that is not authorized by thestatute. We believe the more important point,however, is that other forms of judicial reliefare available to prevent CIRM from makingunauthorized expenditures. (See pp. 300-01,post.)

The method of selecting members of the ICOC standsin stark contrast to the process in Jarvis, supra, 40Cal.App.4th 1359, 48 Cal.Rptr.2d 269, on whichPeople's Advocate places heavy reliance. In that caselegislation delegating authority to levy a tax to a uniquelocal entity was held to violate article XI, section 11,subdivision (a) of the California Constitution, whichprohibits the Legislature from delegating the power tolevy taxes to a private body. The Jarvis courtexplained, “Herein lies the fundamental distinctionbetween the Authority and a public body. With theexception of 2 of the 13 directors, the remaining 11 arechosen by private entities who have no publicaccountability.[FN24] The **297 electorate cannotremove those who are chosen as directors of theAuthority and the electorate cannot remove those whochoose. But the electorate must bear the consequencesof the decisions of those who compose the Authority. And part of that consequence is public taxation anddistribution of public taxes as determined by theAuthority-unaccountable except to entities which haveno public accountability.” (Id. at p. 1388, 48Cal.Rptr.2d 269, italics added.) As we have seen, noprivate person or entity is given the authority to appointa member to the ICOC, and most of its members areappointed by publicly elected officials.

FN24. The 13 members of the board at issuein Jarvis were selected as follows: “(1) Onerepresentative of the Board of Supervisors ofFresno County. [¶] (2) One representative ofthe Fresno City Council. [¶] (3) Onerepresentative of the Eleventh District of theParent Teachers' Association. [¶] (4) Onerepresentative of an ad hoc committee ofretired judges from Fresno County's local and



state benches. [¶] (5) One representative ofthe Fresno City and County Chamber ofCommerce. [¶] (6) One representative of theOlder Americans Association of FresnoCounty. [¶] (7) One representative of an adhoc committee of representatives of theTaxpayers Association of Fresno County andthe San Joaquin Taxpayers Association. [¶](8) One representative of the Citizens forCommunity Enrichment. [¶] (9) Onerepresentative of the Fresno County FarmBureau. [¶] (10) One representative of theFresno-Madera Central Labor Council. [¶](11) One representative of the League ofMexican-American Women. [¶] (12) Onerepresentative of the West Fresno MinisterialAlliance. [¶] (13) One representative of theCalifornia Retired Teachers Association,Fresno County Division.” (Jarvis, supra, 40Cal.App.4th at p. 1384, 48 Cal.Rptr.2d 269.)

*1356 People's Advocate argues that even if themajority of the ICOC members are appointed by publicofficials, the ICOC remains a “private” entity becauseits members are “chosen as representatives of particularinstitutions and interests.” As the trial court explained,however, “[t]he Act sets up the ICOC as a panel ofexperts, whose members are appointed on the basis oftheir qualifications as they relate to matters within theICOC's responsibility.” Except for the executiveofficers from the five University of California campuseswith medical schools, the criteria for selection do notfocus on the institutions with which appointees areaffiliated, but upon factors indicating that theappointees possess sufficient experience and expertiseto perform the responsibilities of the position. (See fn.10, ante.) Ten appointees must be “Californiarepresentatives of California regional, state, or nationaldisease advocacy groups” (§ 125290.20, subd. (a) (3, 4,5)), but they need not be selected from any particularorganization.FN25 PEOPLE'S ADVOCATE MakesmucH of the use of the word “ representatives” insection 125290.20 but its emphasis is misplaced. Proposition 71 was intended to “[c]reate anIndependent Citizen's Oversight Committee composedof representatives of the University of Californiacampuses with medical schools; other California

universities and California medical researchinstitutions; California disease **298 advocacy groups;and California experts in the development of medicaltherapies.” (Prop.71, § 3.) In context, the word“representative” does not mean that each appointeerepresents the particular interests of the group fromwhich he or she was selected, much less that he or shedoes so to the exclusion of the more general publicinterest. An ICOC member may be a representative ofa particular institution or of a disease advocacy groupand still make decisions that are in the best interests ofthe state. (Cf. Consumers Union of U.S., Inc. v.California Milk Producers Advisory Bd. (1978) 82Cal.App.3d 433, 448, 147 Cal.Rptr. 265.) As onewitness testified at trial, members “are drawn fromthose institutions based upon very specific criteria,documenting expertise and level of responsibility andknowledge of stem cell research. But they come andhave an oath of *1357 office, they represent the State ofCalifornia on our board. They do not come torepresent those institutions.”

FN25. Section 125290.20, subdivision (a),provides that “(3) The Governor, theLieutenant Governor, the Treasurer, and theController shall appoint members from amongCalifornia representatives of Californiaregional, state, or national disease advocacygroups, as follows: [¶] (A) The Governorshall appoint two members, one from each ofthe following disease advocacy groups: spinalcord injury and Alzheimer's disease. [¶] (B)The Lieutenant Governor shall appoint twomembers, one from each of the followingdisease advocacy groups: type II diabetes andmultiple sclerosis or amyotrophic lateralsclerosis. [¶] (C) The Treasurer shall appointtwo members, one from each of the followingdisease groups: type I diabetes and heartdisease. [¶] (D) The Controller shall appointtwo members, one from each of the followingdisease groups: cancer and Parkinson'sdisease. [¶] (4) The Speaker of the Assemblyshall appoint a member from amongCalifornia representatives of a Californiaregional, state, or national mental health



disease advocacy group. [¶] (5) The Presidentpro Tempore of the Senate shall appoint amember f rom among Ca l i fo rn iarepresentatives of a California regional, state,or national HIV/AIDS disease advocacygroup.”

The second aspect of state management and controlover the operations of CIRM and the ICOC is the factthat the Cures Act places strict requirements on how theICOC is to allocate moneys in the California Stem CellResearch and Cures Fund. (§ 125290.70.) Implicit is therequirement that all funds be expended to accomplishthe purposes specified in the purpose and intent sectionof the initiative (Prop. 71, § 3; see fn. 4, ante ) and inthe text of the constitutional amendment (Art. XXXV,§ 2; see p. 276, ante ). The Cures Act specifiescriteria by which grant and loan applications are to beevaluated. (§ 125290.60, subd. (c); see p. 304, post.) No less than 97 percent of the bond proceeds, net ofcosts, must be used to fund grants and grant oversightand at least 90 percent of the amounts used for grantsmust be used for research grants on a specific annualschedule. (§ 125290.70, subd. (a).) “Not more than 3percent of the proceeds of bonds ... may be used by theinstitute for research and research facilitiesimplementation costs, including development,administration, and oversight of the grant makingprocess and operations of the working groups.” (Id.,subd. (a)(1)(C).) The Cures Act sets as a priority“immediately building facilities that ensure theindependence of the scientific and medical research”and allocates up to 10 percent of the bond proceeds, netof costs, to building research facilities for nonprofitentities within the institute's first five years. (Id., subd.(a)(4).) The ICOC “[m]ay annually modify its fundingand finance programs to optimize the institute's abilityto achieve the objective that its activities berevenue-positive for the State of California during itsfirst five years of operation without jeopardizing theprogress of its core medical and scientific researchprogram.” (§ 125290.40, subd. (m).) Beginning inNovember 2007, the Act is subject to amendment by a70 percent vote of the Legislature and approval by theGovernor. (Prop.71, § 8.)

Finally, there are significant public and financial

accountability standards to which the institute issubject. (§ 125290.30.) The institute is required topublish an annual report “which sets forth its activities,grants awarded, grants in progress, researchaccomplishments, and future program directions.” (Id.,subd. (a).) Annually it must obtain and disclose anindependent financial audit conducted by a certifiedpublic accounting firm. (Id., subd. (b).) The Cures Actrequires the State Controller to review the financialaudit and issue a public report of that review. (Ibid.)Still further, the Act creates a Citizen's FinancialAccountability Oversight Committee chaired by theState Controller and made up of members primarilyappointed by elected officials, which is charged with**299 reviewing the independent audit, the Controllers'report and the financial practices of the institute. (Id.,subd. (c).) The oversight committee is required to“hold ... public meetings, with appropriate notice, andwith a formal public comment *1358 period.” (Ibid.)The public accountability section of the Cures Act alsorequires that the members conduct business subject tothe Bagley-Keene Open Meetings Act and comply withthe Public Records Act. (Id., subds. (d), (e).)

People's Advocate acknowledges that the Cures Act“provides for audits, open meetings, public records,annual reports and a Financial AccountabilityCommittee,” but argues that “none of theserequirements in any way provides for legislative orexecutive management and control over the [ICOC], orits all-important award granting function.” People'sAdvocate contends, “Whatever controls may exist onthe tiny fraction of public money spent on theperipheral administrative functions performed by theCIRM by arms of the executive branch, they in no wayaffect, much less control, the disbursal of funds by theIndependent Committee in grants and loans. The Actdoes not permit the State Auditor, or the StateController, or the Treasurer, or the head of theDepartment of Finance, nor anyone else in stategovernment to modify or rescind a grant awarded by theIndependent Committee. If the IndependentCommittee awards a grant, the grantee gets the money.”

This argument misapprehends the nature of the statemanagement and control that is required by article XVI,section 3 of the California Constitution. The



constitutional provision has been interpreted “to preventthe appropriation of funds from the state fisc for apurpose foreign to the interests of the state and outsideof its control.” (CART, supra, 109 Cal.App.4th at p.816, 135 Cal.Rptr.2d 224.) Appellants do not questionthat the research funding authorized by the Cures Actserves legitimate public purposes of fighting diseaseand promoting the state economy. The state controlthat is mandated by article XVI, section 3 is the abilityto define the public purposes for which public funds areexpended and to ensure that the funds are used for theirintended public purposes. “It appears that exclusivemanagement and control by the state means theexistence of sufficient controls over the commissionsby the executive and legislative branches of the stategovernment to assure that state funds are used to furtherstate purposes without unduly inhibiting innovativeprograms that serve those purposes.” (CART, supra, atp. 817, 135 Cal.Rptr.2d 224.) The constitutionalprovision does not mean that the executive or thelegislative branches must have the right to second-guessthe ICOC as to the wisdom of particular research orresearch grants. As in Wilson v. State Bd. ofEducation, supra, 75 Cal.App.4th at page 1146, 89Cal.Rptr.2d 745, “appellants misunderstand thelegislative function. ‘Essentials of the legislativefunction include the determination and formulation oflegislative policy. “Generally speaking, attainment ofthe ends, including how and by what means they are tobe achieved, may constitutionally be left in the hands ofothers.” ’ ” In approving Proposition 71 the votersdetermined that grants and loans should be awarded bythe experts who comprise the ICOC, chosen in themanner specified in the Act. So long as there aremechanisms in place to ensure that the grants and loansare being *1359 made for the specified public purposesand in accordance with all other legal requirements,article XVI, section 3 is satisfied.

In CART, the court held that county commissions areunder the control and management of the state in partbecause the relevant statute establishesparameters**300 on how the tobacco tax revenue is tobe spent. (CART, supra, 109 Cal.App.4th at pp.823-824, 135 Cal.Rptr.2d 224.) The statute beingscrutinized in that case identifies diverse programs onwhich the California Children and Families

Commission (CCFC) is to use 20 percent of the taxrevenue, such as mass media communications regardingearly child development, prevention of tobacco use bypregnant women and detrimental effects of second handsmoke on early child development, parental educationtraining, child care programs, and research anddevelopment of standards for early child developmentprograms. The remaining 80 percent of the revenue isdistributed to county commissions to be expended “onlyfor the purposes authorized by the Act” and inaccordance with strategic plans consistent withguidelines to be adopted by the CCFC. The guidelinesmust address a wide range of subjects specified in thestatute, such as parental education and support servicesrelated to informed and healthy parenting andavoidance of tobacco, drugs and alcohol duringpregnancy, the provision of high quality, accessible andaffordable child care, and the provision of health careservices emphasizing prevention and treatment notcovered by other programs. (Ibid.) The courtexplained, “although county commissions are conferredsignificant independence and discretion in adoptingtheir strategic plans and programs to promote localdecisionmaking, the commissions cannot expendtobacco tax revenue on programs inconsistent with the[statutory] guidelines and the purposes of the Act. Thislimitation on spending provides the necessaryspecificity to implement the electorate's policy decisionto delegate to the county commissions the responsibilityof tailoring their programs to address the needs of theirrespective counties.” (CART, supra, at p. 824, 135Cal.Rptr.2d 224.) State management was not lackingbecause no higher authority was authorized to reviewthe content of the educational programs or mediadistributions. (Ibid.; see also Wilson v. State Bd. ofEducation, supra, 75 Cal.App.4th at p. 1146, 89Cal.Rptr.2d 745.)

Likewise, in the present case, the ICOC's discretion islimited by the purposes of the Cures Act and thestatutory spending guidelines and priorities, butnonetheless permits the experts to use their independentjudgment to determine which research grants and loanswill best accomplish CIRM's constitutionally declaredmission. Should the ICOC approve expenditures forpurposes other than those specified in article XXXV,the State Controller has the authority to intervene.



“Government Code section 12410 authorizes the StateController to audit any disbursement of state funds forcorrectness, legality and the availability of funds tosupport the payment.... The Controller's duty to audit‘includes the duty to ensure that expenditures areauthorized by law.’ ” *1360(CART, supra, 109Cal.App.4th at p. 825, 135 Cal.Rptr.2d 224.) The trialtestimony confirmed that prior to issuing a warrant tofund a CIRM grant, the Controller would “look to seewhether those grants were authorized by Proposition71.” If the Controller is concerned about “thecircumstances associated with a particular payment” hecan request a field audit of the payment request. WhilePeople's Advocate is correct that the Controller's duty“does not include the power to review and approve orreject decisions of a department vested by theLegislature with authority over expenditures” (Tirapellev. Davis (1993) 20 Cal.App.4th 1317, 1335, 26Cal.Rptr.2d 666), such authority is unnecessary toprovide constitutionally sufficient management andcontrol. It is not for the Controller any more than theLegislature to determine the wisdom of a particular**301 grant or loan. It is sufficient that the Controllercan refuse to issue a warrant that is not authorized bylaw. (Id. at p. 1328, 26 Cal.Rptr.2d 666.) FN26 Finally,as a last resort, injunctive relief is available to preventunauthorized expenditures. (See Ahlgren v. Carr(1962) 209 Cal.App.2d 248, 252, 25 Cal.Rptr. 887[taxpayer may bring action to enjoin alleged illegalexpenditure of public moneys by a state official].)

FN26. In CART, the court also recognized thatthe State Auditor, the Department of Financeand the State Treasurer also have significantauthority to monitor the expenditure of bondrevenue. “The Department of Finance isauthorized by Government Code section13070 to investigate all financial and businessmatters of the state and investigate stateagencies that receive state funds. UnderGovernment Code section 13030, it is amisdemeanor to fail or neglect to file with theDepartment of Finance any report required bythe Government Code, to fail or neglect tofollow its directions in keeping the accounts ofan agency, or to refuse to permit or interfere

with the examination of or access to anagency's records and books. Finally, underGovernment Code section 8545.2, subdivision(a), the State Auditor is authorized ‘toexamine and [reproduce] any and all books,accounts, reports ... and other records, bankaccounts, and money or other property, of anyagency of the state, whether created by theCalifornia Constitution or otherwise, and anypublic entity, including any city, county, andschool or special district for any audit orinvestigative audit.’ The State Auditor mayalso conduct financial and performance auditsof any state agency, which includes every‘state office, officer, department, division,bureau, board, and commission’ (Gov.Code, §11000).... At the request of the JointLegislative Audit Committee, the StateAuditor shall audit a state or localgovernmental agency or any other publiclycreated entity. The State Auditor isauthorized to audit any contract involvingmore than $10,000 of public funds at therequest of any state or local public entity thatis a party to the contract or is undergoing anaudit by the State Auditor. (Gov.Code, §8546.7.) Further, under the statewhistleblower statute, the State Auditor isauthorized to conduct an investigative audit onreceiving specific information that anyemployee or state agency is engaged in anyimproper governmental activity. (Gov.Code,§ 8547.5.) If the State Auditor discoversevidence of wrongdoing, this informationmust be conveyed to the employing agencyand, if appropriate, the Attorney General, theappropriate legislative policy committees andany other authority that the State Auditordetermines appropriate. (Gov.Code, §8547.7.)” (CART, supra, 109 Cal.App.4th atpp. 825-826, 135 Cal.Rptr.2d 224, fns.omitted.)

The ICOC's structured discretion is far morecomparable to the scheme utilized and approved inCART than to the statutory design that was disapprovedin Bayside Timber Co. v. Board of Supervisors (1971)



20 Cal.App.3d 1, 97 Cal.Rptr. 431, relied upon byPeople's Advocate. In that case, private timber ownerswere given unlimited discretion to formulate forestpractice *1361 rules with a direct financial impact onthemselves, without legislative guidelines or standardsto prevent an abuse of discretion. (Id. at pp. 9-10, 14,97 Cal.Rptr. 431.)

People's Advocate contends that the training grants thatthe ICOC has already awarded with interim financingare beyond the authorized purpose of funding stem cellresearch and illustrate the deficiency in the controlsprovided by the Act. Even if People's Advocate werecorrect that the grants were improperly awarded, theviolation would not necessarily demonstrate theinvalidity of the Cures Act, since as just indicated otherforms of corrective relief are available. However, thetrial court concluded that the training grants are bothconsistent with the purposes of the Act and involvesufficient research-based activities to meet the statutorycriteria. The evidence received at trial fully supportsthis conclusion. The ICOC approved grants “tononprofit academic and research institutions to fostertraining at the level of pre-doctoral students, post-**302doctoral students and clinical fellows.... All trainingprograms must offer one or more classes in stem cellbiology and medicine, and a required course in thesocial, legal and ethical implications of stem cellresearch....” The ICOC determined that there is ascarcity of scientists trained in stem cell research andthat “it was an early and important need in order tofulfill our mission of developing this research to trainthe investigators who were going to carry it out, bothbasic science and clinical investigators....” There wastestimony that training grants are research grantsbecause in the field of stem cell research training isconducted through research. The grants approvedresearch fellowships for “170 of the best and brightestpeople in the nation who were pre-doctoral,post-doctoral or clinical.... And these fellowships willdo real time research in the labs with mentors, some ofthe best people in the country who are all inCalifornia.... [T]hey're going to be doing cutting edgeresearch with an accompanying education program withethics and law and in advanced technology.... [T]heseresearch grants rebuilt the intellectual infrastructure forthe state in this area and allowed to ramp up for the next

level of research grants.” Rather than demonstratingunauthorized expenditures, the training grants illustratethe reason for which the ICOC has been vested with thediscretion to determine the appropriate use of the fundsto accomplish the public purposes endorsed byProposition 71. These grants certainly do not suggestthat the ICOC has been given free reign to spend bondproceeds in any manner it wishes.

Finally, People's Advocate contends that any statecontrol over the ICOC is “so attenuated as to beeffectively non-existent” because it is diluted by theability of certain members of the ICOC to delegate theirduties to nonappointed representatives and by the use ofworking groups to make initial recommendationsregarding the award of grants. Neither feature of theCures Act, however, undermines the necessary degreeof state control.

*1362 Section 125290.20, subdivision (a)(2)(D)provides in pertinent part, “The executive officer of aCalifornia university, a nonprofit research institution orlife science commercial entity who is appointed as amember, may from time to time delegate those duties toan executive officer of the entity or to the dean of themedical school, if applicable.” Delegates are subjectto the same qualifications as the members who appointthem, they must take the same oath of office and file thesame disclosure forms, and they serve at the pleasure ofthe appointed member. In light of the stringentqualifications for ICOC membership and the likely timeconstraints of individuals who meet thesequalifications, it is not unreasonable to anticipate, asone trial witness testified, that these members will beunable to attend all of the many meetings held by ICOCduring the year. The delegation provisionaccommodates this reality without sacrificing the levelof expertise required of ICOC members. Therequirement that delegates come from the sameinstitution as the member was designed to ensure thatthe ICOC have “the benefit of the expertise ofalternates who share the same qualifications asmembers, when members of the ICOC are unavailable.” We agree with the trial court that the use of alternatesprovides “a permissible degree of flexibility andoperational independence needed to further the publicpurposes of the Act, and thus does not cause the ICOC



to be in violation of article XVI, section 3.”

Similarly, we see no basis for the argument that the roleof working groups to identify potentially meritoriousgrant and loan applications renders the ultimatedecision regarding the disbursement of public **303funds outside of the state's control. The Cures Actestablishes three working groups: a Scientific andMedical Research Funding Working Group, a Scientificand Medical Accountability Standards Working Groupand a Scientific and Medical Research FacilitiesWorking Group. (§ 125290.50, subd. (a).) Members ofthe working groups are appointed by a majority of aquorum of the ICOC and serve fixed six-year terms.(Id., subd. (b).) The qualifications for membership onthe three scientific and medical working groups aredefined to include, for example, ICOC members fromgroups focusing on disease-specific areas, “scientistsand clinicians nationally recognized in the field ofpluripotent and progenitor cell research,” “medicalethicists,” and “scientists nationally recognized in thefield of stem cell research.” (§§ 125290.55, subd. (a),12590.60, subd. (a), 125290.65, subd. (a).) Workinggroup members who are not bound by the conflict ofinterest rules applicable to ICOC members are subjectto conflict of interest rules adopted by the ICOC. (§125290.50, subd. (e).) The working groups are “purelyadvisory and have no final decision making authority.”(Id., subd. (e)(3).) “Recommendations of each of theworking groups may be forwarded to the ICOC only bya vote of a majority of a quorum of the members ofeach working group. If 35 percent of the members ofany working group join together in a minority position,a minority report *1363 may be submitted to the ICOC.The ICOC shall consider the recommendations of theworking groups in making its decisions on applicationsfor research and facility grants and loan awards and inadopting regulatory standards. Each working groupshall recommend to ICOC rules, procedures, andpractices for that working group.” (Id., subd. (d).)

People's Advocate is particularly concerned with theScientific and Medical Funding Working Group (grantsworking group), which it asserts “is empowered toperform functions that are paramount in the operationof the Institute [citation], i.e., recommending thestandards and requirements for awarding research

grants, and reviewing grant applications and makingrecommendations to the [ICOC] for the award ofgrants.” The grants working group has 23 members;7 of whom are ICOC members from disease advocacygroups, 15 are scientists nationally recognized in thefield of stem cell research and the last is the chairpersonof the ICOC. (§ 125290.60, subd. (a).) FN27 In additionto the statutory qualifications, relying on therecommendations of the National Academy of Science,the ICOC added the additional requirement that the 15scientist members be drawn from outside of California. This working group is required, among other things, to“[r]ecommend to the ICOC ... criteria, standards, andrequirements for considering funding applications andfor awarding research grants and loans” and “standardsfor the scientific and medical oversight of awards” and“[r]eview grant and loan applications based on thecriteria, requirements, and standards adopted by theICOC and make recommendations to the ICOC for theaward of research, therapy development, and clinicaltrial grants and loans.” (Id., subd. (b).) The working**304 group's recommendations with regard to grantand loan applications are to be based on a competitivepeer review of the scientific merit of the applicationsperformed by the 15 scientist members of the group. The scientist members are required to score theapplications based on scientific merit in three separateclassifications-research, therapy development, andclinical trials.FN28 (Id., subd. (c).) All of the membersof the working group review the applications and as agroup make a *1364 recommendation to the ICOC. TheICOC reviews and votes on all applications, includingthose not recommended for funding by the workinggroup.

FN27. The evidence at trial indicated thatalternates to the grants working group,satisfying the same qualifications as the 15scientist members, have been appointed by theICOC, and that these alternates serve at thedirection of institute staff when a workinggroup member is unable to attend a meeting orhas a conflict of interest, and that no morethan 15 scientist members participate inreviewing any one grant or loan application. Although the Act does not expressly provide



for alternates to the working group members,we see nothing in the Act that precludes theuse of such alternates.

FN28. Section 125290.60, subdivision (c)provides additional criteria for considerationin each of those classifications including, “(A)A demonstrated record of achievement in theareas of pluripotent stem cell and progenitorcell biology and medicine, unless the researchis determined to be a vital researchopportunity. [¶] (B) The quality of theresearch proposal, the potential for achievingsignificant research, or clinical results, thetimetable for realizing such significant results,the importance of the research objectives, andthe innovativeness of the proposedresearch.[¶] (C) In order to ensure thatinstitute funding does not duplicate orsupplant existing funding, a high priority shallbe placed on funding pluripotent stem cell andprogenitor cell research that cannot, or isunlikely to, receive timely or sufficient federalfunding, unencumbered by limitations thatwould impede the research. In this regard,other research categories funded by theNational Institutes of Health shall not befunded by the institute. [¶] (D)Notwithstanding subparagraph (C), otherscientific and medical research andtechnologies and/or any stem cell researchproposal not actually funded by the instituteunder subparagraph (C) may be funded by theinstitute if at least two-thirds of a quorum ofthe members of the Scientific and MedicalResearch Funding Working Grouprecommend to the ICOC that such a researchproposal is a vital research opportunity.”

People's Advocate acknowledges that “[a]s a group the[ICOC] does not have the scientific acumen in stem celltechnology that is possessed by the [grants workinggroup]” and that “[i]t only makes sense that the [ICOC]would rely so heavily on the [grants working group]because the [grants working group] invests so muchmore effort into the evaluation.” FN29 Nonetheless, theyargue that the ICOC's reliance on working groups

renders the Cures Act beyond the limits of state controlrequired by article XVI, section 3. We disagree. Theuse of a working group consisting of highly qualifiedexperts to evaluate and make recommendationsregarding grant and loan applications is both reasonableand falls within the range of constitutionally acceptableoperational procedures. One trial witness explained,“The 15 scientist and physician scientists on the grantsworking group are there to bring a broad range ofexpertise to the peer review of scientific and medicalgrant proposals that have the potential to advance ourknowledge and understanding of stem cell research....”Both the statute itself and the evidence at trial makeclear that the final decision regarding any grantapplication is to be made, and in fact is being made, bythe ICOC. The activities of the working group aretransparent to the public through application of thePublic Records Act and to the ICOC through its eightrepresentatives in the group. The evidence at trialestablished that while the ICOC has generally followedthe recommendations of the working groups, it hasoften made changes to the recommendations beforeawarding grants. There is no basis under either theterms of the statute or the evidence concerning practicesthat have been adopted to conclude that the ultimatedecisions regarding disbursement **305 of taxpayerfunds are not made by the ICOC.

FN29. Trial testimony established that theprimary review of an average proposal takesbetween four and five days and a complexapplication may take up to seven days.

Indeed, the trial court also found, and substantialevidence supports the finding, that “the application ofthe Act has been in compliance with the statutoryframework.... Each ICOC member, and each alternate,has taken the oath of office and publicly filed Form700, the standard form California *1365 public officialsfile to disclose financial holdings. The ICOCdeveloped and adopted incompatible activitiesstatements, the conflict of interest code required by thePolitical Reform Act, and conflict of interest policiesfor ICOC members, CIRM staff, and members of eachof the ICOC advisory groups. Between January 2005and the date of trial, the ICOC, its subcommittees, and



its working groups held over 40 noticed, publicmeetings in cities across the state, held pursuant to theBagley-Keene Open Meeting Act. CIRM has respondedto numerous Public Records Act requests. Theselection of the site for CIRM's facilities was run by theDepartment of General Services, as required of stateagencies, which department also executed the lease.The required independent audit is in process and is tobe reviewed by the Citizen's Financial OversightCommittee. In addition, testimony was presented thatCIRM is subject to audit by the Controller and theDepartment of Finance, and that the Controller has metwith the ICOC to discuss the types of practices heexpected the ICOC to follow. [¶] There was alsoevidence that the State Treasurer, Controller, andDirector of Finance, through their membership on theFinance Committee, exercised their authority to makesure that bonds are only issued for purposes permittedby the Act. Further, there was evidence that the StateLegislature has already held several public oversighthearings looking into CIRM's budget, policies, andstandards, which is pertinent not only because it showson-going oversight by the Legislature, but because theAct expressly provides that the Legislature can amendthe Act ‘to enhance the ability of the institute to furtherthe purposes of the grant and loan programs' after athree-year start-up period.”

In short, we conclude, as did the court in CART, that theCures Act here “is replete with controls, including themanner of appointment of members [of both the ICOCand its working groups], the specificity regarding how[bond] revenues must be spent, and the annual auditand reporting requirements.” (CART, supra, 109Cal.App.4th at p. 820, 135 Cal.Rptr.2d 224.) The Actdoes not violate article XVI, section 3 of the CaliforniaConstitution.

2. The Conflict of Interest Provisions of the Cures ActAre Not Unlawful.

[14] The Council contends that the conflict of interestrules applicable to the ICOC and to working groupmembers “violate California law and public policy” andrender Proposition 71 invalid. The Council asserts that“Proposition 71 is replete with conflicts of interest

among the members of the ICOC, because the structureof the ICOC under the initiative mandates *1366appointment of board members who have personal,professional and institutional interests that conflict withthe public interest.” These arguments can be dismissedrather summarily.FN30

FN30. Initially, we note that the Council'spresentation of its arguments fails in large partto meet the most basic standards foracceptable appellate briefing. Most notably,the Council fails to cite authority for most ofits arguments, including the claim that theProposition 71 conflict of interest rules areunconstitutional. Although the Council's bareallegations of constitutional infirmity do “notreflect the substantial effort required when aparty mounts a constitutional challenge,” wedecline the Attorney General's suggestion thatwe deem the argument waived without furtherdiscussion. (Calderon v. Kane (1995) 36Cal.App.4th 1663, 1668-1669, 43 Cal.Rptr.2d480.)

**306 The Council first suggests that the trial court“erroneously dismisses the conflicts of interest of theICOC member, including the making of grants ofmillions of dollars to their own members' institutions aslegally and ethically permissible.” This statement,however, mischaracterizes both the trial court's decisionand the statutory provisions. Members of the ICOCare expressly prohibited from participating in decisionsinvolving grant applications submitted by theinstitutions with which they are affiliated. (§125290.30, subd. (g).) Section 125290.30, subdivision(g) specifies that the provisions of the Political ReformAct (Gov.Code, § 81000 et seq.) apply to the instituteand the ICOC except as otherwise specified in theCures Act. Subdivision (g)(1) provides that while nomember of the ICOC may participate in a decision toaward a grant, loan or contract to his or her employer,“a member may participate in a decision to approve oraward a grant, loan, or contract to a nonprofit entity inthe same field as his or her employer” or “to an entityfor the purpose of research involving a disease fromwhich a member of his or her immediate family suffers



or in which the member has an interest as arepresentative of a disease advocacy organization.” Subdivision (g)(2) provides that “Service as a memberof the ICOC by a member of the faculty oradministration of any system of the University ofCalifornia shall not, by itself, be deemed to beinconsistent, incompatible, in conflict with, or inimicalto the duties of the ICOC member as a member of thefaculty or administration of any system of theUniversity of California and shall not result in theautomatic vacation of either such office. Service as amember of the ICOC by a representative or employeeof a disease advocacy organization, a nonprofitacademic and research institution, or a life sciencecommercial entity shall not be deemed to beinconsistent, incompatible, in conflict with, or inimicalto the duties of the ICOC member as a representative oremployee of that organization, institution or entity.” Subdivision (g)(3) limits the circumstances under whichGovernment Code section 1090, which prohibits publicofficers and employees from being financiallyinterested in contracts made by agencies on which theyserve, *1367 applies to any grant, loan or contract madeby the ICOC.FN31 Other provisions relating to potentialconflicts of interest of ICOC members and workinggroup members appear elsewhere throughout the CuresAct. (E.g., §§ 125290.20, subd. (a)(2)(C), FN32

125290.50, SUBD. (E).FN33)

FN31. Subdivision (g)(3) of section125290.30 provides that Government Codesection 1090 does not apply to suchtransactions unless both of the followingconditions apply: “(A) The grant, loan, orcontract directly relates to services to beprovided by any member of the ICOC or theentity the member represents or financiallybenefits the member or the entity he or sherepresents [and] (B) The member fails torecuse himself or herself from making,participating in making, or in any wayattempting to use his or her official position toinfluence a decision on the grant, loan orcontract.”

FN32. Subdivision (a)(2)(c) of section

125290.20 limits executive officers of lifescience commercial entities appointed to theICOC to those who are not actively engagedin researching or developing therapies withpluripotent or progenitor stem cells, and havenot been awarded, or applied for, funding bythe institute at the time of appointment. However, the subdivision provides, “A boardmember of that entity with a successful historyof developing innovative medical therapiesmay be appointed in lieu of an executiveofficer.”

FN33. See text at page 307, post.

**307 It is unnecessary to consider whethermembership on the ICOC by those who are qualified toserve would violate conflict of interest restrictions thatwould apply in the absence of the provisions includedin the Cures Act. To the extent these provisions conflictwith other statutory or common law rules regarding theregulation of conflicts of interest, the more specific andlater enacted provisions of the Act govern. (See Woodsv. Young (1991) 53 Cal.3d 315, 324-325, 279 Cal.Rptr.613, 807 P.2d 455; People v. Tanner (1979) 24 Cal.3d514, 521, 156 Cal.Rptr. 450, 596 P.2d 328.) TheCouncil's suggestion that section 125290.30 bereconciled with more general conflict of interest laws“by appointing ICOC members who do not haveconflicts of interest and ... by prohibiting the ICOCfrom awarding grants to the institutions represented bythe members of the ICOC” would both rewrite the Actand defeat the very purpose of the qualifications forappointment to the ICOC. The trial court concluded,correctly we believe, that these “specific and limited”conflicts of interest provisions are necessary “in orderto allow individuals with the necessary expertise fromacademic and commercial entities that do have financialinterests in the subject of stem cell research to serve onthe ICOC.”

The Council contends that if the more general statutoryand common law conflict of interest provisions are notapplicable to the ICOC members, they shouldnonetheless apply to members of the grants workinggroup. This argument is based on the incorrectassertion that the grants working group is a



decisionmaking rather than an advisory body. However, section 125290.50, subdivision (e)(3)provides that “[b]ecause the working groups are purelyadvisory and have no final decisionmaking authority,members of the working *1368 groups shall not beconsidered public officials, employees or consultantsfor purposes of the Political Reform Act” and otherconflict of interest statutes. Subdivision (e)(1) requiresthe ICOC to adopt conflict of interest rules fornon-ICOC working group members based on standardsapplicable to members of scientific review committeesof the National Institutes of Health and subdivision(e)(2) requires the ICOC to appoint an ethics officer. And, as noted above, the rules adopted by the ICOCrequire all scientist members of the grants workinggroup to come from institutions outside of California,which institutions are not eligible for grants or loansfrom CIRM. A trial witness explained that the ICOCwanted to have “the strongest conflict provisions” andthat “if you have a Californian scientist on the workinggroup and that scientist [was] able to apply for thegrant, they would certainly have an inside advantagewhich [the ICOC] [does] not want to permit.”

The Council contends that the refinements made bysection 125290.30, subdivision (g) to more generalconflict of interest provisions violate public policy orare somehow inherently unethical. These concerns aremisplaced. (See Topanga Assn. for a ScenicCommunity v. County of Los Angeles (1989) 214Cal.App.3d 1348, 1365-1366, 263 Cal.Rptr. 214 [“Astatute is not subject to objection on the ground itcontravenes public policy because, as a legislativeenactment, it becomes public policy”].) The regulationof conflicts of interest often requires balancingcompeting interests. It is not for the courts to strike adifferent balance than has been made by the Legislatureor the people. (See Friends of La Vina v. County of LosAngeles (1991) 232 Cal.App.3d 1446, 1456, 284Cal.Rptr. 171, disapproved on other grounds in WesternStates Petroleum Assn. v. Superior Court (1995) 9Cal.4th 559, 570, 38 Cal.Rptr.2d 139, 888 P.2d 1268,fn. 2 [“Except where the law clearly provides rules foridentification**308 and rectification of what might betermed conflicts of interest, that is a legislative not ajudicial function”]; cf., e.g., Woodland Hills ResidentsAssn., Inc. v. City Council (1980) 26 Cal.3d 938,

946-947, 164 Cal.Rptr. 255, 609 P.2d 1029.) In thiscase, by approving Proposition 71 the voters havedetermined that the advantages of permittingparticularly knowledgeable persons to decide whichresearch projects to fund outweigh any concerns thatthese decisions may be influenced by the personal orprofessional interests of those members, so long as themembers do not participate in any decision to awardgrants to themselves or their employer.

The Council argues, “It is a violation of due process oflaw for applicants for grants to the ICOC to have theirgrant applications voted on by ICOC members whoseown institutions have competing grant applicationsbefore the ICOC.... Even though the members do notvote directly on their own institution's grant application,they have the information and opportunity to favor theICOC member institutions and their fellow members onthe ICOC....” Section 125290.30, subdivision (g)(1)(a),however, prohibits ICOC members not only frommaking or participating in making grants to *1369 theiremployers, but also from “in any way attempt[ing] touse his or her official position to influence a decision toapprove or award a grant, loan, or contract to his or heremployer.” We have no reason to believe, andcertainly will not presume, that ICOC members will notcomply with this prohibition.

The Council also argues that “the grants of conflicts ofinterest exemptions to the ICOC members and theirinstitutions represent unconstitutional privileges andimmunities.” FN34 The Council suggests, “The ability toengage in such self-serving grantmaking ... representsan unconstitutional privilege, privileged access to statefunds, and an unconstitutional immunity, immunityfrom liability for conflicts of interest.” The Cures Act,however, does not grant any personal privilege,entitlement or immunity to the members of the ICOC.Any loosening of conflicts rules that might otherwiseapply merely permits the individual to serve on theICOC while employed by an entity that may beinterested in or affected by the work of CIRM. Suchstatutory qualifications or exemptions from conflict ofinterest regulations are commonplace. For example,there are several statutory exemptions to GovernmentCode section 1090, which prohibits public officialsfrom being “financially interested in any contract made



by them in their official capacity, or by any body orboard of which they are members.” Exceptions aremade for the subdivision of land owned by a publicofficial (Gov.Code, § 1091.1), for a “contract or grantmade by local workforce investment boards”(Gov.Code, § 1091.2) and for a “contract or grant madeby a county children and families commission”(Gov.Code, § 1091.3). These exemptions areremarkably similar to those made under section125290.30.FN35

FN34. The privileges and immunities clauseof the California Constitution provides inpertinent part, “A citizen or class of citizensmay not be granted privileges or immunitiesnot granted on the same terms to allcitizens....” (Cal. Const., art. I, § 7, subd.(b).)

FN35. Section 1091.1 provides: “Theprohibition against an interest in contractsprovided by this article or any other provisionof law shall not be deemed to prohibit anypublic officer or member of any public boardor commission from subdividing lands ownedby him or in which he has an interest andwhich subdivision of lands is effected underthe provisions of Division 2 (commencingwith Section 66410) of Title 7 of theGovernment Code or any local ordinanceconcerning subdivisions; provided, that (a)said officer or member of such board orcommission shall first fully disclose the natureof his interest in any such lands to thelegislative body having jurisdiction over thesubdivision thereof, and (b) said officer ormember of such board or commission shallnot cast his vote upon any matter or contractconcerning said subdivision in any mannerwhatever.” Section 1091.3 provides:“Section 1090 shall not apply to any contractor grant made by a county children andfamilies commission ... except where both ofthe following conditions are met: [¶] (a) Thecontract or grant directly relates to services tobe provided by any member of a county

children and families commission or the entitythe member represents or financially benefitsthe member or the entity he or she represents.[¶] (b) The member fails to recuse himself orherself from making, participating in making,or in any way attempting to use his or herofficial position to influence a decision on thegrant or grants.”

**309 *1370 In Consumers Union of U.S., Inc. v.California Milk Producers Advisory Bd., supra, 82Cal.App.3d 433, 147 Cal.Rptr. 265, this court upheldthe validity of a regulation permitting industry membersto serve on a board regulating that industry so long asthey did not participate in decisions affecting their owninterests in a manner different from the interests ofother members of the industry. The court pointed to asurvey by the Fair Political Practices Commissionindicating that in California there are approximately 92state boards, as well as numerous local boards, whichinclude such members. (Id. at p. 438, 147 Cal.Rptr.265.) The court upheld the regulation as applied to theMilk Advisory Board, pointing out that, much like thesituation under the Cures Act, the board was required toadopt a conflict of interest code and that boardmembers were required to disclose potential conflicts,file periodic statements disclosing their income,investments and assets, and disqualify themselves if adecision would have a material effect on their personalfinancial interest. (Id. at p. 448, 147 Cal.Rptr. 265.) Tellingly, the court observed: “Merely because a boardmember derives income from within a given industry,he or she does not lose the ability to be objective. Nordoes that person lose the capacity to make decisionsbeneficial to the public's interest.” (Ibid.)

The Council's reliance on the training grants awardedby the ICOC to illustrate problematic conflicts ofinterest is unavailing. The trial evidence establishesthat the ICOC awarded sixteen training grants for atotal of $38,912,252, eight of which, totaling$20,867,547, were awarded to U.C. campuses.FN36 Anadditional approximately $12 million was awarded tofive institutions with representatives on the ICOC.Approximately $6 million was awarded to entities withno representative on the ICOC. This evidence, withoutany additional information suggesting improper



self-dealing, fails to demonstrate any impropriety, muchless illegality, in the training grants. Indeed, the datamight just as well be viewed as confirming thesuccessful inclusion on the ICOC of members from abroad range of institutions with expertise in the field ofstem cell research. Moreover, as the trial court noted,“Neither the original complaint filed by [the Council]nor its amended complaint challenges the validity ofspecific awards made by the ICOC. The amendedcomplaint was filed in July 2005, months before anysuch awards **310 were made, and [the Council] didnot seek to amend it after that time.”

FN36. The Council's contention that all ICOCmembers affiliated with a U.C. campus wererequired to recuse themselves from voting ongrant applications involving any U.C. campusis simply wrong. Nothing in section125290.30, or any other provision of the Act,requires that the five U.C. campuses be treatedas a single institution or employer forpurposes of regulating conflicts of interest. The fact that the University of California isconsidered a “unitary system” in othercontexts is irrelevant. The trial testimonyestablished that the five U.C. campusesoperate individually with regard to bothresearch and grant applications.

*1371 Insofar as the Council contends that specificICOC members have disqualifying conflicts of interest,those arguments are not relevant to the validity of theCures Act. To the extent that the trial court consideredthe Council's evidence regarding individual members asrelevant to the Council's second cause of action,seeking a declaration that those members, including thechair and vice-chair, are disqualified from serving onthe ICOC, we review the findings under the substantialevidence test. The court found that the Council failedto make a showing that any specific ICOC member “‘has reason to believe or expect that he will derive adirect monetary gain or suffer a direct monetary loss, asthe case may be, by reason on his official activity.’ ”(Quoting Gov.Code, § 8921, emphasis omitted.) Thecourt explained, “ Plaintiff simply points to disclosureforms and biographies showing that some of the

members have ownership interests in various biotechcompanies, and some are employees of companies oracademic institutions of potential grantees-but presentsno evidence that any committee member will accrue adirect monetary gain or loss from service on the ICOC.”Under the express terms of section 125290.30, an ICOCmember's affiliation with a particular institution thatmay seek funding from CIRM is insufficient toestablish a disqualifying conflict of interest.

Thus, we conclude, as did the trial court, that theconflict of interest provisions of the Cures Act violateno constitutional restriction, and that there has been noshowing that any member serving on the ICOC hasviolated the governing conflict provisions.

D. The Exclusion of Correspondence BetweenEmployees of the Five University of CaliforniaCampuses Represented in the ICOC, if Error,

Was Not Prejudicial.

[15] People's Advocate contends that due to a series ofrulings by the trial court relating to the scope andduration of discovery and the admissibility of evidence,correspondence between employees of the fiveUniversity of California (U.C.) campuses representedon the ICOC was erroneously excluded at trial, and thatthe exclusion of this evidence was prejudicial becausethe evidence would have established that thesemembers of the ICOC were in fact “representatives” oftheir university and that the ICOC was a private entitynot under the exclusive control of the state.FN37 People'sAdvocate asserts that the correspondence shows boththat the ICOC members from the University ofCalifornia *1372 would put the interests of theuniversity before that of the state and also that therewas “coordination, cooperation, and central control ofthe nine University of California representatives on the[ICOC].”

FN37. People's Advocate also states that it“had no fair chance to take any meaningfuldiscovery about these documents or theactivities they recorded” because many ofthese documents were assertedly produced late



in the discovery period. However, People'sAdvocate has not raised a specific challengeto any particular discovery or in limine ruling. It contends only that the effect of the trialcourt's rulings as a whole was to deny it a fulland fair trial on the merits, a proposition thatis thoroughly dispelled by a review of therecord.

It is unnecessary to detail each of the trial court rulingsthat led to exclusion of this evidence because it is clearthat even if any of the disputed correspondence shouldhave been admitted, any error was not prejudicial. Even if considered, this correspondence does notestablish that the **311 institute or the ICOC wasoutside the management and control of the state.FN38

Rather, the evidence establishes that the faculty andadministration at the U.C. campuses were workingtogether cooperatively at times to further the interests ofboth the institute and the campuses, while at the sametime remaining mindful of the potential for actual andperceived conflicts of interests. Dr. Klein testified thatthe five U.C. campuses were “chosen because theyhouse the five medical schools in the U.C. system. And they have tremendous repository of medical andscientific expertise. And they have strong histories instem cell research, so that those five campuses are partof a core of the State of California university medicalsystem and scientific research system ... that looks atthis new frontier.” Dr. Klein stated that “each of [thecampuses] is very highly competitive with the other, sothat they each have something individual to bring to thetable.” For example, in an e-mail in which it wassuggested that Dr. Kessler be appointed to represent theU.C. campus in San Francisco (UCSF), the authorexplains his recommendation as follows: “UCSF has astatutory role on the *1373 Independent Citizens'Oversight Committee, yet members must recusethemselves from decisions involving their employers. Depending on how ‘employer’ is interpreted, that couldtake five people out of each decision on a U.C. grant....With that in mind, our representative may have more ofa role as an overall policy influencer and potentiallypublic advocate for science than strictly adecision-maker or a grant-making body. [¶] ... I thinkwe are better served by having a representative who canbe a strong advocate for sound science-and whose

public visibility may be important to steer thedebate....” Nothing in this letter demonstrates that theinterests of UCSF representatives are contrary to theinterests of the state or that the ICOC memberscompromise the interests of the state in favor theirindividual interests. Likewise, in an e-mail containingthe draft intellectual property model, the author advises,“please be mindful of the rule requiring ICOC membersto avoid un-noticed ‘serial meetings,’ which means that**312 members should avoid discussing ICOC businesswith other members in such a way that the discussion(whether live, by phone, or by email) might wind upincluding more than a quorum of members.” Theseletters provide no basis on which to conclude that theICOC was outside the management and control of thestate.FN39 Their admission would not have affected theconclusions reached in the trial court and in this court.

FN38. People's Advocate quotes selectivelyfrom five excluded e-mails or memoranda thatit asserts support its claim. In one excludedemail it is suggested that Dr. David Kesslerserve as the UCSF representative to the ICOCbecause he has “the public recognition thatcan help position UCSF best, especially incomparison to other California institutions.” In a subsequent email, the UCSF AssistantNews Director states that she is “not sure thatit is in UCSF's interest to have [Dr. Kessler]serve as an academic spokesperson to the [SanFrancisco Chronicle] editorial board on theICOC/CIRM process ... when UCSF is goingto be one of the key applicants for majorfunding from CIRM.” She adds that Dr.Kessler should “continue to do his part on theboard ... but not to create a high profile forhimself as a defender of/explainer of theICOC/CIRM process.... The goal of thisstrategy would be to diminish the possibleperception of a conflict of interest in his tworoles.” People's Advocate also cites an e-mailfrom an employee of the U.C. Office of thePresident seeking “input regarding faculty weshould nominate for ICOC membership.” Asecond e-mail circulates an internal draftproposing considerations for developing a



Proposition 71 intellectual property modelamong the U.C.'s ICOC representatives. Finally, a memo was excluded in which theauthor, apparently a U.C. Chancellor, objectsto plans to ask all U.C. campuses to submittheir proposals for Proposition 71 funding tothe U.C. Office of the President for approval. He argues that the “requirement seems aconsiderable intrusion on campus prerogative”and that it would be a “tactical error.” Heexplains, “I expect that there will be a naturaltendency on the part of the [ICOC] to spreadthe wealth around, and that there will be aresistance to ‘overendowing’ U.C. Anythingthat detracts from the image of each campus asan independent agent seems likely to add tothe sensitivities about U.C. as the gorilla onthe scene.”

FN39. People's Advocate also contends thatthe trial court erred in excluding a letterwritten by an ICOC appointee from theUniversity of Southern California (USC) inwhich he stated that he was working to benamed to the ICOC “ ‘so that the KeckSchool's and USC's concerns can be wellrepresented from the initial stages of thisimportant endeavor.’ ” For the same reasons,the exclusion of this evidence, if error, wasnot prejudicial because the appointee'sexpressed desire to have the concerns of hisuniversity heard is not necessarily inconsistentwith the goals and purposes of the ICOC. Theconflict of interest rules ensure that a memberdoes not participate in any decisions directlyaffecting the university at which the memberis employed.

Conclusion

As we indicated at the outset, our review of the variousconstitutional and other objections appellants haveaddressed to the stem cell initiative involves nonormative evaluation of the merit of the measure. Nonetheless, the objective of the proposition is to find,“as speedily as possible,” therapies for the treatmentand cure of major diseases and injuries, an aim the

legitimacy of which no one disputes. The verypendency of this litigation, however, has interfered withimplementation for more than two years. After carefulconsideration of all of appellants' legal objections, wehave no hesitation in concluding, in the exercise of “‘our solemn duty to jealously guard the preciousinitiative power’ ” (CART, supra, 109 Cal.App.4th atp. 808, 135 Cal.Rptr.2d 224), that Proposition 71suffers from no constitutional or other legal infirmity. Accordingly, we shall affirm the well-reasoneddecision of the trial court upholding the validity of theinitiative.

*1374 Disposition

The judgment is affirmed.

We concur: PARRILLI, Acting P.J., and SIGGINS, J.Cal.App. 1 Dist.,2007.California Family Bioethics Council v. CaliforniaInstitute for Regenerative Medicine147 Cal.App.4th 1319, 55 Cal.Rptr.3d 272, 07 Cal.Daily Op. Serv. 2075

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