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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO

Civil Action No. 14-cv-02850-CMA-KLM ROCKY MOUNTAIN GUN OWNERS, et al.,

Plaintiffs, v. SCOTT GESSLER, et al.,

Defendants.

COLORADO ETHICS WATCH’S BRIEF IN OPPOSITION TO PLAINTIFFS’ MOTION FOR PRELIMINARY INJUNCTION

Colorado Ethics Watch (“Ethics Watch”), through undersigned counsel, hereby

submits this brief in opposition to the motion for preliminary injunction filed by Plaintiffs

Rocky Mountain Gun Owners (“RMGO”) and Colorado Campaign for Life (“CCL”).

INTRODUCTION

RMGO and CCL seek a preliminary injunction from this Court to halt

administrative enforcement proceedings regarding unreported electioneering conduct

that occurred over five months ago. Each organization admits to sending mailers in

June 2014 that meet the definition of “electioneering communications” in Article XXVIII,

§ 2(7) of the Colorado Constitution without filing disclosures with the Colorado Secretary

of State. (Pl. Br. at 6). Indeed, both organizations have stipulated to all the material facts

in the administrative case which gave rise to this complaint. See Stipulation of Facts

dated Oct. 10, 2014 (copy attached as Exhibit 1). Rather than face the legal

consequences of their actions, RMGO and CCL ask the Court to hold Colorado’s

electioneering communication disclosure law facially unconstitutional and enjoin

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pending administrative proceedings to enforce this law. Even if RMGO and CCL had

valid constitutional claims against the electioneering communications disclosure

provisions in Article XXVIII, there is no basis for a preliminary injunction because this

case involves past conduct and there is no imminent harm to these organizations.

The preliminary injunction must also be denied because RMGO and CCL have

no likelihood of success on the merits. The U.S. Supreme Court has repeatedly upheld

electioneering communications disclosure provisions as constitutional. See McConnell

v. Fed. Election Comm’n, 540 U.S. 93, 196-99 (2003) (rejecting facial challenge to

electioneering communications provision); Citizens United v. Fed. Election Comm’n,

558 U.S. 310, 366-71 (2010) (“Citizens United I”) (8-1 opinion upholding disclosure

requirements as applied to nonprofit corporations making electioneering

communications). Disregarding this precedent, the preliminary injunction motion rests

upon cases regarding Colorado’s separate regime for “issue committee” registration and

reporting, and a single case from the Seventh Circuit regarding a Wisconsin law that is

materially distinct from Colorado’s electioneering communications disclosure law. See

Sampson v. Buescher, 625 F.3d 1247 (10th Cir. 2010); Coal. for Secular Gov’t v.

Gessler, No. 1:12-cv-01708-JLKKLM, 2014 U.S. Dist. LEXIS 144389 (D. Colo. Oct. 10,

2014) (“CSG”); see also Wisconsin Right to Life v. Barland, 751 F.3d 804 (7th Cir. 2014)

(“Barland”). None of the authority cited by RMGO and CCL overrules Supreme Court

precedent approving electioneering communication disclosures like those required in

Colorado.

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This case is the latest in a trio of constitutional attacks against Colorado’s

electioneering communications disclosure provisions by groups seeking to avoid

disclosure when engaging in targeted advertising about state candidates in the final

days of the election cycle. Unlike the plaintiffs in Citizens United v. Gessler, No. 14-

1387, 2014 U.S. App. LEXIS 20792 (10th Cir. Oct. 27, 2014) (“Citizens United II”)1,

these plaintiffs have no claim to a “media entity” status exemption. This case is more

like Independence Institute v. Gessler, No.14-cv-02425-RBJ, 2014 U.S. Dist. LEXIS

150272 (D. Colo. Oct. 22, 2014), in which this Court rejected a challenge to the

electioneering communications disclosure requirements because the question has been

settled by the Supreme Court. See Citizens United I, 558 U.S. at 367.

FACTUAL AND PROCEDURAL BACKGROUND

I. Colorado’s Campaign Finance System

In 2002, Colorado voters passed Amendment 27 and adopted a comprehensive

campaign and political finance system, declaring, inter alia, “that the interests of the

public are best served by . . . providing for full and timely disclosure of…funding of

electioneering communications, and strong enforcement of campaign finance

requirements.” Colo. Const. art. XXVIII, § 1. Together with the Fair Campaign Practices

Act (“FCPA”), C.R.S. §§ 1-45-101,et seq., Article XXVIII establishes various registration

and reporting requirements.

For example, state candidates, political parties, issue committees and political

committees (“PACs”) are required to register, provide treasurer and bank information,

1 The Tenth Circuit ordered the Citizens United II opinion to be published on November 12, 2014.

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and file regularly scheduled reports reflecting all funds flowing in and out of the

committee based on a calendar issued by the Secretary of State. See C.R.S. § 1-45-

108(1)(a)(I). These different types of reporting committees are defined by their activities

and must initially register after passing a certain dollar threshold of activity. See, e.g.,

Colo. Const. art. XXVIII, § 2(10) (defining “issue committee” as a group of two or more

persons that has a major purpose of opposing or supporting a ballot issue and receives

contributions or makes expenditures in excess of $200 to support or oppose a ballot

issue). None of these “PAC-like” requirements are at issue in this case.

“Electioneering communications” is a separate category of political spending

defined in Colo. Const. art. XXVIII, § 2(7) that it is not linked to any particular type of

registered committee. An individual or group must file a disclosure statement if it

broadcasts, prints or mails an ad which “unambiguously refers to any candidate” inside

that candidate’s district within the last thirty days before a primary election or sixty days

before a general election. Colo. Const. art. XXVIII, §§ 2(7); 6(1). The definition is based

upon the federal “electioneering communications” law. See 52 U.S.C. § 30104(f)(3).

There is no requirement to register a committee; the law requires only the filing of an

online transaction report that includes the following information:

1. All spending of $1,000 or more on the electioneering communication, including “name, address, and method of communication.” See Colo. Const. art XXVIII, § 6(1); 8 C.C.R. 1505-6, Rule 11.3.

2. “The name of the candidate(s) unambiguously referred to in the electioneering communication.” See 8 C.C.R. 1505-6, Rule 11.5.

3. The names and addresses of persons contributing $250 or more for electioneering communications.

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See Colo. Const. art XXVIII, § 6(1); C.R.S. § 1-45-108(1)(a)(III). When, as here, the

organization reporting an electioneering communication is a corporation, the report must

only disclose the names of donors who gave money “specifically earmarked for

electioneering communications.” See 8 C.C.R. 1505-6, Rule 11.1. Once the information

has been reported, there is no continuing obligation to file disclosures unless or until

that person or organization makes another electioneering communication.

Article XXVIII and the FCPA also establish a two-track enforcement system.

Late filings by registered entities are subject to a fine of $50 per day, but may be

reduced by the Secretary upon a showing of “good cause.” See Colo. Const. art. XXVIII,

§ 10(2). All other violations of Article XXVIII and the FCPA are enforced only through a

litigation process pursuant to which “any person” may file a complaint with the

Secretary, who refers the case to an administrative law judge for resolution. See Colo.

Const. art. XXVIII, § 9(2)(a); C.R.S. § 1-45-111.5(1.5)(a). Courts in such cases may

impose fines of up to $50 per day for violations of disclosure requirements. See Colo.

Const. art. XXVIII, § 10(2). Orders by the administrative judge are reviewable by the

Colorado Court of Appeals. See Colo. Const. art. XXVIII, § 9(2)(a).

II. The Underlying Administrative Case Regarding RMGO and CCL Mailings

Filling a void that exists because Colorado law leaves most campaign finance

law enforcement to the private sector, nonprofit Ethics Watch has filed and litigated

several campaign finance complaints in Colorado’s administrative courts. Ethics Watch

filed a campaign finance complaint against RMGO and CCL on September 9, 2014

alleging violations of the constitutional and statutory electioneering communications

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disclosure requirements in connection with mailings sent to Republican primary voters

in two Colorado state Senate districts in June 2014.

In anticipation of a hearing originally scheduled for September 23, Ethics Watch

filed notices of depositions and requests for documents in September. Exercising their

right under Colo. Const. art. XXVIII, § 9(2)(a) to an automatic continuance, RMGO and

CCL were able to reschedule the hearing for November 6. See CCL’s and RMGO’s

Motion for Extension of Time for Hearing in OS 2014-0025 (copy attached as Exhibit 2).

All discovery requests were withdrawn before responses were required, or depositions

were held, because the parties agreed to a joint stipulation of facts, which was filed with

the Office of Administrative Courts on October 20, 2014. See Exhibit 1. That same day,

Ethics Watch received a copy of the Complaint in this matter. The administrative law

judge has continued the hearing again, to December 17, and Ethics Watch did not

oppose that continuance. Based on the stipulated facts and exhibits, Ethics Watch

anticipates that the administrative hearing will not require live testimony.

ARGUMENT

“Under the traditional four-prong test for a preliminary injunction, the party

moving for an injunction must show: (1) a likelihood of success on the merits; (2) a likely

threat of irreparable harm to the movant; (3) the harm alleged by the movant outweighs

any harm to the non-moving party; and (4) an injunction is in the public interest.” Hobby

Lobby Stores, Inc. v. Sebelius, 723 F.3d 1114, 1128 (10th Cir. 2013), aff’d sub nom.

Burwell v. Hobby Lobby Stores, 134 S. Ct. 2751 (2014). RMGO and CCL fail this test.

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I. Plaintiffs Have No Likelihood of Success on the Merits

In support of the Motion, RMGO and CCL argue that Colorado’s electioneering

communications disclosure law is unconstitutionally overbroad and that the $1,000

threshold for reporting is unconstitutionally low. Neither challenge has any likelihood of

success in the face of years of precedent holding electioneering communications

disclosure requirements constitutional. See Hobby Lobby, 723 F.3d at 1145 (“[I]n First

Amendment cases, the likelihood of success on the merits will often be the

determinative factor.”) (internal quotation marks and citations omitted).

A. The U.S. Supreme Court has twice upheld disclosure requirements

for Electioneering Communications

RMGO and CCL’s facial overbreadth challenge to electioneering communication

disclosure requirements comes ten years too late. Plaintiffs argue that only “express

advocacy” or its equivalent may be “regulated,” but the express advocacy limitation

does not apply to laws such as Colorado’s that require only disclosure of contributions

and spending for electioneering communications. See Citizens United I, 558 U.S. at

368-69 (rejecting the express advocacy limitation on disclosures). Disclosure-only laws,

like the transactional electioneering communications reporting in Colorado, have been

consistently reviewed with a lower level of constitutional scrutiny because those laws

pose far less risk of infringement on free speech than bans or limits on spending. See

Citizens United I, 558 U.S. at 369 (discussing the application of this principle in cases

from Buckley v. Valeo, 424 U.S. 1 (1976), to the present); N.M. Youth Organized v.

Herrera, 611 F.3d 669, 676 (10th Cir. 2010) (distinguishing lower level of scrutiny as

applied to disclosure regulations). “In assessing the constitutionality of Colorado’s

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disclosure requirements, we consider whether they satisfy exacting scrutiny.” Citizens

United II, 2014 U.S. App. LEXIS 20792, at *23.

Colorado’s electioneering communications definition is practically the same as

the federal definition that has twice been held constitutional for requiring disclosures by

the Supreme Court under exacting scrutiny. First, the Supreme Court rejected a facial

challenge to the federal electioneering communications provision based on these same

overbreadth arguments in McConnell, 540 U.S. at 190-93. Next, the Supreme Court in

Citizens United I struck down the provision which prohibited corporations from making

electioneering communications, but upheld the electioneering communication disclosure

requirement without any limitation to ads that expressly advocate for or against

candidates. Citizens United I, 558 U.S. at 370. The Supreme Court endorsed disclosure

as necessary for voters to “make informed decisions and give proper weight to different

speakers and messages.” Id. at 371. The Tenth Circuit has interpreted Citizens United I

as holding disclaimer and disclosure requirements constitutionally applicable to all

electioneering communications. See Free Speech v. Fed. Election Comm’n, 720 F.3d

788, 795 (10th Cir. 2013).

RMGO and CCL attempt to avoid this precedent by basing their overbreadth

challenge on the Seventh Circuit’s review of a Wisconsin law that is not analogous to

Colorado’s electioneering communications disclosure requirements. The law reviewed

in Barland required registration of a committee before any political speech was made

and imposed “PAC-like” reporting requirements, i.e., ongoing entity registration and

reporting as opposed to transaction-based disclosure. See Barland, 751 F.3d at 812-13.

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In contrast, Colorado’s electioneering communications disclosures are transaction-

based, occur only after the speech has been made, and include information that is

relevant to citizens, but not burdensome to entities filing the report. See Citizens United

II, 2014 U.S. App. LEXIS 20792, at *29. (Colorado’s “disclosure requirements are not

expansive.”). Colorado electioneering communications reports require only disclosure of

the spending and earmarked donations linked to that specific mailing, not a listing of all

money flowing in and out of the organization like in Wisconsin. Barland itself

distinguishes Wisconsin’s PAC-like requirements from the “event-driven disclosure for

federal electioneering communications” that were approved by the Supreme Court in

Citizens United I. Barland, 751 F.3d at 836. Colorado’s law is not subject to the same

overbreadth concerns as Wisconsin’s because it does not impose “PAC-like”

registration and ongoing reporting requirements. Colorado’s electioneering

communications disclosures are constitutional under McConnell and Citizens United I.

See Independence Institute, 2014 U.S. Dist. LEXIS 150272, at *15 (“the plaintiff’s

challenge must fail for the same reason the facial challenge failed in McConnell”).

B. RMGO and CCL Have Not Presented a Credible Challenge to $1,000

Threshold for Electioneering Communications

The Plaintiff’s challenge to the $1,000 threshold is also based on the false

premise that electioneering communications disclosures in Colorado require “PAC-like

reporting and disclosure requirements.” The two cases relied upon by RMGO and CCL

interpret Colorado’s issue committee provision, which requires registration of a

committee and ongoing periodic reporting of all money raised and spent by a committee

after reaching a $200 threshold of activity supporting or opposing a ballot measure. See

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Sampson, 625 F.3d at 1249; CSG, 2014 U.S. Dist. LEXIS 144389, at *3. This analysis

is not controlling in a review here of transactional electioneering communications

reports subject to a higher starting threshold of $1,000. See also Barland, 751 F.3d at

837 ($300 threshold for PAC-like registration and reporting requirements). Colorado

electioneering communications law has a threshold that is five times the amount

reviewed in Sampson and CSG for a transactional (not “PAC-like”) reporting

requirement. In addition, much of Sampson’s holding rests on the assumption that the

state’s interest in requiring disclosures of spending in ballot initiative elections is weaker

than its interest in requiring disclosure in elections involving candidates for office. See

Sampson, 625 F.3d at 1255-56; CSG, 2014 U.S. Dist. LEXIS 144389 at *12-*13

(quoting Sampson). The electioneering communications disclosure at issue in this case

applies only to state candidate elections where public interest in disclosure is high.

Moreover, both Sampson and CSG were fact-intensive inquiries for as-applied

challenges to the $200 issue committee threshold that do not govern the review in this

case. See Sampson, 625 F.3d at 1261 (“We say only that Plaintiffs’ contributions and

expenditures are well below the line.”); CSG, 2014 U.S. Dist. LEXIS 144389 at *14 (the

standard is whether a “small-scale issue committee” is sufficiently similar to the

Sampson plaintiffs) (internal cites omitted).

RMGO and CCL have not placed any evidence in the record regarding how

much their groups spent supporting and opposing candidates in the 2014 election cycle

for the Court to compare to the $1,000 threshold. Both the Sampson and CSG holdings

were based on the actual amounts spent by the groups compared to the burdens of

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disclosure – but the Court cannot do such an analysis here without RMGO and CCL

spending in the record. See Sampson, 625 F.3d at 1260 (noting the total spending of

$782.02 by plaintiffs); CSG, 2014 U.S. Dist. LEXIS 144389 at *4 (stating Plaintiff

spending ranged from $200 to $3,500 since 2008). Nor can RMGO and CCL claim to be

similarly situated to the “neighborhood disputes” plaintiffs in Sampson who were

opposing a local town annexation measure, or to the academic publishing a paper

online in CSG. See Sampson, 625 F.3d at 1251; CSG, 2014 U.S. Dist. LEXIS 144389 at

*15. RMGO is “Colorado’s largest state-based Second Amendment grassroots lobbying

organization” (Compl. ¶ 12) and CCL is likewise a state-wide lobbying and public policy

organization (Compl. ¶ 16).

These groups are savvy repeat political players with wide-ranging membership

across the state, not “a group of individuals who have together spent less than $1,000”

to oppose a local measure. Sampson, 625 F.3d at 1261. At a minimum, they have failed

to carry their burden of establishing facts that might support a finding that they are

similar to the Sampson plaintiffs. Without specific facts similar to Sampson, there is no

reason to find the $1,000 threshold is unconstitutionally low. Cf. Free Speech, 720 F.3d

at 798 (upholding political committee status with $1,000 threshold).

Not only does campaign finance precedent consistently protect the public’s

interest in disclosure without offending the Constitution, the requirement of disclosure is

part of the rationale for recent Supreme Court cases overturning restrictions on political

spending. See McCutcheon v. Fed. Election Comm’n, 134 S. Ct. 1434, 1460, 572 U.S.

___ (2014) (“With modern technology, disclosure now offers a particularly effective

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means of arming the voting public with information.”). See also Citizens United, 558

U.S. at 370 (“prompt disclosure of expenditures can provide shareholders and citizens

with the information needed to hold corporations and elected officials accountable for

their positions and supporters.”); McConnell, 540 U.S.at 196-99 (upholding disclosures

of donation information required for electioneering communications); Buckley, 424 U.S.

at 81 (“disclosure helps voters to define more of the candidates’ constituencies”).

Plaintiffs’ challenges to the Colorado electioneering communications disclosure

provisions have no likelihood of success in the face of this precedent. See Republican

Nat. Comm. v. Fed. Election Comm’n, 698 F. Supp. 2d 150, 157 (D.D.C. 2010) (three-

judge court), aff’d, 130 S. Ct. 3543 (2010) (“a plaintiff cannot successfully bring an as-

applied challenge to a statutory provision based on the same factual and legal

arguments the Supreme Court expressly considered when rejecting a facial challenge to

that provision.”).

II. RMGO and CCL Do Not Face Irreparable Harm

Plaintiffs’ irreparable harm argument begins and ends with the truism that a

violation of constitutional rights is irreparable injury. See, e.g., Kikumura v. Hurley, 242

F.3d 950, 963 (10th Cir. 2001). (Pl. Br. at 13-14). To the contrary, there is no “chilling

effect” that could harm RMGO or CCL’s free speech rights without an injunction: both

groups already electioneered in the Republican primary. The electioneering

communications windows for both the 2014 primary and general elections have closed,

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both groups have spoken, and neither group needs a preliminary injunction to safeguard

future speech.2

Regardless, the Supreme Court has already determined that any “harm” from

filing electioneering disclosure reports is not a violation of constitutional rights. See

Citizens United I, 558 U.S. at 369-70. Nothing in the electioneering communications

provisions of the Colorado Constitution or FCPA prevents RMGO and CCL from

continuing to create and send mailers in Colorado at any time of the year. These groups

may spend and speak at will so long as they disclose the amount spent and the source

of funding for any electioneering communications so that voters can fully assess their

messages. As discussed above, these transactional disclosure reports present a

minimal burden and would most likely result in a single report filed online by RMGO and

CCL. Plaintiffs do not place any evidence in the record that there would be harm

suffered by donors or organizations if the modest disclosure requirements were

followed. (Pl. Br. at 2). The Supreme Court has held that a mere allegation that harm

could theoretically exist from political spending disclosure is not enough to strike down

an electioneering communications scheme. Citizens United I, 558 U.S. at 370 (rejecting

argument without evidence of donor threats). Nor is it enough to constitute “irreparable

harm” supporting a preliminary injunction.

Plaintiffs also exaggerate the harm that would be inflicted by proceeding with the

administrative enforcement case absent an injunction. (Pl. Br. at 7-8). All material facts

in the case have been stipulated and filed with the administrative law judge. There will

2 The next electioneering communications window will not occur until thirty days before the June 2016 primary election.

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not be any “pre-trial discovery” or a “full adversary proceeding, much akin to a bench

trial.” Now that the hearing has been continued to December 17, RMGO and CCL will

not be harmed by “preparing for trial during election season.” If RMGO and CCL are not

satisfied with the outcome of the December 17 hearing, any order issued by the

administrative law judge is appealable to the Colorado Court of Appeals. See Colo.

Const. art. XXVIII, § 9(2)(a). Any inconvenience of proceeding with the December 17

hearing while this case is pending is shared by Ethics Watch, and is an insufficient basis

for a preliminary injunction.

III. The Balance of Harms and the Public Interest Weigh Against Enjoining

Colorado Disclosure and Enforcement Laws

While RMGO and CCL would suffer little harm in the absence of a preliminary

injunction, Ethics Watch and the public at large would be greatly harmed if the court

were to enjoin enforcement of the electioneering communications provisions. Since the

complaint was filed in early September, Ethics Watch has worked with RMGO and CCL

regarding the re-scheduling of the administrative hearing and signed a joint stipulation

of facts. With all factual questions resolved, Ethics Watch withdrew pending discovery

requests and was prepared to resolve the case at the November hearing. The Court

should consider RMGO and CCL’s delay in filing this case until the eve of that

November hearing in its balancing of harms. Continued delay in the administrative case

will merely consume more resources for Ethics Watch (as well as RMGO and CCL).

The public interest also weighs against the broad injunction sought by plaintiffs to

preclude enforcement of the electioneering communications law against RMGO and

CCL or any other entity in Colorado. Public disclosure of spending on electioneering

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communications is a constitutional value, placed in the Colorado Constitution by

citizens. The public has a strong interest in the enforcement of Colorado’s disclosure

laws regarding money in politics.

The Supreme Court balanced the interests of political speakers with the public

interest of the electorate, stating: “[t]he First Amendment protects political speech; and

disclosure permits citizens and shareholders to react to the speech of corporate entities

in a proper way.” Citizens United I, 558 U.S. at 371. There is a public interest not only in

learning what donors (if any) earmarked monies to be spent on candidate-specific

mailings, but also in the required spending disclosures. Citizens have a legitimate

interest in knowing how much a group spent to influence their votes, and in the strong

enforcement of laws imposing penalties on those who conceal information voters are

entitled to know.

CONCLUSION

For the foregoing reasons, the Court should deny the motion for preliminary

injunction.

Respectfully Submitted on November 26, 2014,

____s/ Margaret Perl____________ Margaret Perl Luis Toro COLORADO ETHICS WATCH

1630 Welton Street, Suite 415 Denver, CO 80202 Telephone: 303-626-2100 Email: pperl@coloradoforethics.org ltoro@coloradoforethics.org Attorneys for Colorado Ethics Watch

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CERTIFICATE OF SERVICE

I certify that on November 26, 2014, a copy of this BRIEF IN OPPOSITION TO

PLAINTIFFS’ MOTION FOR PRELIMINARY INJUNCTION was served through

CM/ECF file-and-serve on the parties listed below:

David A. Warrington Laurin H. Mills Andrew J. Narod Paris R. Sorrell LeClairRyan, A Professional Corporation 2318 Mill Road, Suite 1100 Alexandria, Virginia 22314 Telephone: (703) 684-8007 david.warrington@leclairryan.com laurin.mills@leclairryan.com andrew.narod@leclairryan.com paris.sorrell@leclairryan.com

James O. Bardwell Rocky Mountain Gun Owners 501 Main Street, Suite 200 Windsor, CO 80550 Telephone: (877) 405-4570 jb@nagrhq.org

Attorneys for Rocky Mountain Gun Owners and Colorado Campaign for Life Kathryn A. Starnella Assistant Attorney General Frederick R. Yarger Assistant Solicitor General Public Officials Unit |State Services Section 1300 Broadway, 10th Floor Denver, Colorado 80203 Telephone: (720) 508-6176 kathryn.starnella@state.co.us fred.yarger@state.co.us Attorneys for Colorado Secretary of State

___s/ Margaret Perl__________________

Margaret Perl