Title: IN RE: INITIATIVE PETITION NO. 379
Citation: 155 P.3d 32, 2006 OK 89
Docket Number: 
State: Oklahoma
Issuer: Oklahoma Supreme Court
Date: December 12, 2006

IN RE: INITIATIVE PETITION NO. 379 Annotate this Case IN RE: INITIATIVE PETITION NO. 379 2006 OK 89 155 P.3d 32 Case Number: 102999 Decided: 12/12/2006 THE SUPREME COURT OF THE STATE OF OKLAHOMA In re: ORIGINAL PROCEEDING TO DETERMINE THE LEGALITY AND NUMERICAL SUFFICIENCY OF INITIATIVE PETITION No. 379. ¶0 Following the Secretary of State's (Secretary's) certification of sufficient signatures to place Initiative Petition No. 379, State Question No. 726 (IP 379/initiative/TABOR) on the ballot, two protests were filed. The Court-assigned Referee heard evidence in the cause and issued a report finding significant evidence of illegal activity involving out-of-state circulators and determining that the petition failed for numerical insufficiency of signers. Protests to the Referee's report were filed. Following the filing of briefs, this Court issued an order indicating an official opinion would follow and providing that: the petition failed for insufficiency of signers; the evidence supported substantial illegal participation of out-of-state circulators; and denying the request for oral argument. We hold that: 1) because of the mass involvement of out-of-state circulators in the signature gathering process establishing a pervasive pattern of wrongdoing and fraud and the resultant resistance to discovery and continued secrecy surrounding the operation, the only effective way to protect the integrity of the initiative process and uphold the constitutional and statutory rights and restrictions associated therewith is to strike the TABOR petition in its entirety; and 2) the initiative petition fails for numerical insufficiency of signers. INITIATIVE PETITION No. 379 IS DECLARED INVALID FOR ILLEGALITY AND FRAUD IN THE SIGNATURE COLLECTION PROCESS AND FOR NUMERICAL INSUFFICIENCY OF SIGNERS. Jack S. Dawson, Kieran D. Maye, Jr., Robert E. Norman, Richard L. Rose, MILLER DOLLARHIDE, Oklahoma City, Oklahoma, for petitioner/proponent, Rick Carpenter, D. Kent Myers, Roger A. Strong, Mary Robertson, Jennifer A. Dutton, Jonathan D. Echols Jr., CROWE & DUNLEVY, Oklahoma City, Oklahoma, for respondents/protestants, Keith Bailey, Clayton Bennett, G.T. Blankenship, John Brock, Bill W. Burgess, Lynne A. Bussell, Luke R. Corbett, Marlin Glass, Jr., Fred Hall, V. Burns Hargis, Kirk Humphreys, George B. Kaiser, Albert Kel Kelly, Jr., Tom Love, Stanley Lybarger, John Massey, Aubrey McClendon, Melvin Moran, J. Larry Nichols, Joseph L. Parker, Jr., Stuart Price, H.E. Rainbolt, Carl R. Renfro, Stacy Shusterman, Sabra Tucker, Steve Turnbo, Fannie Bates, Pro se respondent/protestant, Neal Leader, Senior Assistant Attorney General, Oklahoma City, Oklahoma, Amicus curiae. WATT, C.J.: ¶1 Initiative Petition No. 379, State Question 726 is commonly known as TABOR, an acronym for Taxpayer Bill of Rights. The measure seeks to amend art. 10, §23 of the Oklahoma Constitution setting limits on the growth of state spending and requiring any surplus funds to be placed in a constitutional emergency fund. Legislative expenditures over limits set by the initiative require voter approval with any citizen having the right to sue to enforce TABOR's provisions.1 ¶2 As previously indicated in the order issued on August 31, 2006, two issues are addressed. ¶3 The overwhelming evidence reveals involvement of out-of-state circulators in the signature gathering process establishing a pervasive pattern of wrongdoing and fraud. Furthermore, the resistance to discovery and the secrecy surrounding the petition process warrant the garnering of negative inferences concerning the entire operation. Therefore, we determine that the only effective way to protect the integrity of the initiative process and to uphold the constitutional and statutory rights and restrictions associated therewith is to strike the TABOR petition in its entirety. Finally, the initiative fails for numerical insufficiency of signers. FACTS ¶4 At all times, Rick Carpenter (Carpenter/proponent) has been the named proponent of the initiative petition, appearing in person and by counsel in the legal proceedings. However, except for taking the physical steps necessary to file the initiative petition, Carpenter has acted only as a pro forma proponent. The entity actually responsible for the circulation and signature collection process is a Nevada corporation, National Voter Outreach (NVO), ¶5 Carpenter filed IP 379 with the Secretary on September 19, 2005. Within 90 days thereafter, on December 19, 2005, the proponent submitted signatures to the Secretary. ¶6 Pursuant to ¶7 On several occasions, the protestants found it necessary to file motions to assist in their discovery requests. On June 23, 2006, we issued an order recognizing that the parties and their agents had not voluntarily cooperated in the discovery and hearing process. The order acknowledged that the issue of out-of-state circulators in the signature gathering phase of the initiative process was before the Court and bore directly on the sufficiency of the petition. The Referee was instructed to entertain all discoverable evidence concerning the issue and the parties were ordered to cooperate in the discovery process. It was only subsequent to the issuance of this order that the protestants were able to depose two material witnesses. After the close of evidence, the protestants filed a brief asserting that the entire TABOR petition should be thrown out due to fraud, corruption, illegality and chicanery. ¶8 On July 24, 2006, the Referee issued a report finding that the initiative petition should be declared numerically insufficient and should not be placed on the November ballot. The report also outlined the significant evidence demonstrating the knowing and illegal utilization of out-of-state circulators in the initiative process. Exceptions to the Referee's report were filed by both the proponents and the protestants. We issued an order on August 4, 2006, setting a briefing schedule which was concluded with the filing of simultaneous answer briefs on August 24, 2006. ¶9 On August 31, 2006, we issued an order determining that: 1) the petition failed for numerical insufficiency of signers; 2) the evidence supported substantial illegal participation of out-of-state circulators; and 3) the request for oral argument should be denied. Furthermore, the order provided that a formal opinion would follow ¶10 1) The involvement of out-of-state circulators in the signature gathering process establishes a pervasive pattern of wrongdoing and fraud which, combined with the resistance to discovery and continued secrecy surrounding the operation, require TABOR to be stricken in its entirety. Nothing less will protect the integrity of the initiative process and uphold constitutional and statutory rights and restrictions. ¶11 The organization officially responsible for the circulation of the TABOR petition and registered as the initiative's ballot committee is a non-profit organization, Oklahomans in Action (Action). Although it appears that either Rick Carpenter or Action contracted with some individuals to circulate petitions, NVO was brought in to manage the circulation process. It was this out-of-state organization's contractual responsibility to ensure that enough signatures of Oklahoma voters were collected to qualify the initiative for placement on the November ballot. ¶ 12 a) TABOR is not an Oklahoma initiative funded by Oklahoma citizens interested in changing Oklahoma law. ¶13 One of the reasons given for bringing in the out-of-state organization was its prior success in qualifying initiative petitions in Oklahoma. Evidently, NVO has been involved in approximately ten other petition drives in this state.10 The contract between NVO and Action and/or Carpenter provided for payment of all signatures collected during the TABOR drive.11 It is difficult to determine how much NVO actually collected for its efforts in Oklahoma, as it resisted disclosure of this information.12 Nevertheless, from evidentiary submissions, it appears that the organization received approximately one half million dollars for its circulation efforts during the initiative drive.13 ¶14 The ethics reports filed by Action during the petition period indicate total expenditures of almost two million dollars in the initiative effort.14 The same disclosures further demonstrate that TABOR was not an Oklahoma initiative, circulated by Oklahomans interested in changing Oklahoma law. Contributions to the effort came largely from out-of-state entities. By the end of December, 2005, out-of-state entities headquartered in Illinois, Virginia, Colorado and Washington, D.C., had contributed $1,205,000.00 to the initiative campaign.15 ¶15 Depending on the contract at issue, circulators were paid up to half of their compensation in cash. Payments were not based on the number of legally acceptable signatures collected as long as validity rates ranged from 75 to 80 percent. ¶16 b) Although precious, the initiative right is not absolute; the parameters of the rights and restrictions are established by the Oklahoma Constitution, legislative enactments and this Court's jurisprudence. Pivotal to the integrity of the circulation process is the Oklahoma residency of circulators. ¶17 Oklahoma citizens are endowed with the right of the initiative by the Oklahoma Constitution, art. 5, §§1 and 2. ¶18 The proponents recognize that under art. 3, §1, ¶19 The terms residency and domicile are interchangeable and synonymous. ¶20 Just as it is this Court's constitutional duty to determine residency as it relates to elections, the Legislature shoulders the constitutional responsibility pursuant to art. 5, §8 to enact laws to prevent corruption in making, procuring, and submitting initiative and referendum petitions. ¶21 The Legislature's focus on the circulator's pivotal role in the initiative proceedings acknowledges the importance of the signature gathering process. Indeed, the integrity of the initiative process in many ways hinges on the trustworthiness and veracity of the circulator. ¶22 The Legislature has made it the responsibility of the circulator to verify that an individual voter actually signed the petition. Circulators must swear that the individual listed on the petition sheet signed the petition in their presence. Furthermore, each time that a circulator executes the verification of signatures, the individual must swear to be "a qualified elector of the State of Oklahoma" and provide a post office address.58 Nothing less than an accurate address for the circulator will constitute substantial compliance with the statutory requirement of providing a post office address.59 Not only does the proven execution of a false affidavit constitute fraud, it destroys all probative value of the verification.60 ¶23 c)The overwhelming evidence reveals that NVO knowingly used in excess of sixty out-of-state circulators, recruited other out-of-state organizations to bring in circulators, and allowed a foreign national to collect signatures and another circulator to verify the petition -- all of which are illegal activities under Oklahoma law. ¶24 The evidence presented leads to one undeniable conclusion -- the out-of-state circulators had no intention to make Oklahoma their legal residence. The question is not whether out-of-state circulators were used in the initiative drive, the question is only how many. We can be certain that there were more than sixty out-of-state circulators working the Tabor petition. ¶25 Circulators act as agents for those on whose behalf they are collecting signatures.61 When Johnson admitted that she had brought in circulators from other states, she couldn't remember the exact number, their identities or their states of residence.62 When questioned about sixty-two pros whom she had indicated in an electronic mail transmission would be coming in, she couldn't recall who any of those individuals were.63 Not only did NVO use it's own out-of-state circulators, it drafted assistance in the circulation efforts from other foreign petition firms.64 Johnson remembered contracting with a manager from California who agreed to provide a team of circulators and to collect 10,000 signatures.65 Also, Johnson was aware that pros were recruiting people from outside Oklahoma to circulate the TABOR petition; and, armed with this knowledge, she allowed the signature collection to continue.66 Johnson knew that at least one foreign national collected signatures and that those signatures were submitted under another circulator's name.67 Although she admitted that NVO paid travel and hotel expenses for these out-of-state circulators, she couldn't remember which circulators were paid for plane travel.68 Where travel was paid, Johnson assumed it was for out-of-state circulators.69 ¶26 Many of the out-of-state circulators were referred to as "pros" by NVO and its agents or independent contractors operating in Oklahoma. These individuals were known to NVO to be people who made their living moving from state to state acting as circulators in multiple petition drives.70 The manager of the Tulsa office acknowledged that he had pros working out of his office and that he knew there were pros working under other managers in Oklahoma, but he could not remember their names or exactly how many circulators were involved.71 ¶27 When a notary was questioned about the identifications provided her, she indicated that she received out-of-state identifications from the states Pennsylvania, Virginia and Kentucky. The notary also stated she couldn't remember all of the out-of-state individuals and that when she entered the majority of their names on her notary log, she did not utilize the address on the out-of-state identification but an address where they could be located in Oklahoma.72 When the protestants realized that at least one notary had been notarizing petitions without a bond, they flew circulators back into Oklahoma so that their signatures could be properly notarized.73 ¶28 The petition managers had circulators in the field about whose validity they were concerned. During December, the petition managers became aware that at least one of their circulators was turning in signatures collected by others under his name.74 To ensure that out-of-state circulators questioned by police and asked for identification would not be arrested or ordered to cease signature collections, circulators were encouraged to obtain Oklahoma identification.75 ¶29 d) NVO's resistence to discovery and the secrecy surrounding its operation warrants an inference that the organization and the entire circulation process lacked all integrity. ¶30 To say that NVO resisted discovery efforts would be a gross understatement. The protestants attempted service on the organization's President on a number of occasions and even hired a private investigator to locate Johnson but were entirely unsuccessful. It was only after this Court issued an order on June 23, 2006, directing the parties to cooperate in the discovery process and to complete discovery in a timely manner that the protestants were able to depose Johnson, the organization's President, and Jeff Johnson (Tulsa Manager), who ran and organized the NVO campaign in the Tulsa area managing an office identified as PoliticalActivists.org. Even then, Johnson testified to facts and produced documents only on the issues she deemed relevant rather than complying with the subpoena issued.77 Documents promised for production during the Tulsa Manager's deposition have yet to be produced. ¶31 A party intentionally concealing evidence necessary for a tribunal to make a correct decision and preventing the complaining party from having its interest fairly presented or fully considered by the court commits fraud.78 ¶32 The record in this case is replete with credible, unchallenged instances of actual fraud in the circulation of petitions. Not only were numerous petition circulators non-residents of this State, they engaged in outright fraud by using false addresses purportedly to satisfy Oklahoma law.79 Furthermore, some circulators were encouraged to further the fraud and to hide true residential status by obtaining Oklahoma identification cards. NVO's admitted activities include bringing in numerous out-of-state circulators, contracting with out-of-state firms to come into Oklahoma and collect signatures, allowing at least one foreign national to circulate a petition and having another out-of-state circulator turn in and sign that petition, and encouraging circulators to obtain Oklahoma identification to circumvent any questions regarding their residency while collecting signatures. ¶33 These admitted activities constitute criminal activities as defined by the Oklahoma Legislature. The evidence which was uncovered points to systemic wrongdoing; i.e., an established pattern of fraud demonstrated by out-of-state circulators representing themselves as Oklahoma residents when they verified petitions, thereby committing felonies,80 and by acting as circulators in violation of the requirement that they be bona fide Oklahoma residents.81 The evidence of these activities coupled with NVO's resistance in the discovery process warrant an inference that the entire operation of the organization lacked integrity.82 With the limited evidence the protestants were able to extract from NVO, it is abundantly clear that the wrongdoing extended all the way to the top of the hierarchy of the organization -- Susan Johnson, its President. ¶34 Once NVO had collected the number of signatures it deemed necessary to qualify TABOR for the ballot, it removed itself from the state83 presumably taking its pro circulators on to the next most profitable petition drive. NVO and its out-of-state circulators were paid, imported entities in search of signatories for their own economic benefit -- not for the benefit of Oklahoma citizens or their laws. Both Oklahoma's initiative process and its voters deserve more. The importation of out-of-state residents to obtain signatures for a ballot measure in an Oklahoma state election paid for by out-of-state contributors in which these people have no interest is illegal, fraudulent and unsettling. Such activities may not be countenanced where the Legislature has seen fit to provide safeguards against fraud, corruption and chicanery. It is this Court's duty to ascertain and to give effect to the legislative intent making the safeguards feasible, workable and effective.84 ¶35 The primary purpose of the statutory scheme is to protect the public from corrupting influences that might be brought to bear upon the electoral process by agents who are financially interested in the petition's success. This protection can be fully accorded only if petitions which are tainted by illegal circulation may be barred from the public ballot. If the State's sole remedy is merely a criminal prosecution, then the public will be forced to bear the burden of dealing with the very sort of petition which the statutes seek to prevent. Were we to decree the validity of such a petition, we would be affirmatively sanctioning the type of corruption which the statutes outlaw and we would be depriving the public of the protection which the Legislature has conferred. This we will not do. Therefore, we determine that the initiative petition must be struck in its entirety.85 ¶36 2) The initiative petition fails for numerical insufficiency of signers. ¶37 The Legislature has provided that procedural requirements of the initiative and referendum process are not mandatory but that substantial compliance is sufficient.86 We apply this standard, as we have in a long line of Oklahoma jurisprudence.87 Nevertheless, an independent review of the materials presented during the hearing before the Referee along with the exceptions to the Referee's report confirm that the petition fails for numerical insufficiency. ¶38 The gross number of signatures received from the Secretary totaled 299,029. The number of signatures required to place the measure on the ballot is 219,564,88 requiring that 79,466 challenges be sustained to avoid a vote of the people on the measure. ¶39 Indisputable evidence demonstrates that 57,850 signatures must be disallowed as collected by out-of-state circulators.89 The parties recognize that 7,17590 signatures must be eliminated for failure of the notary to have a bond in place.91 A total of 7,071 challenges stand unrebutted.92 Six hundred and sixty five signatures are disallowed for giving only a post office address in Tulsa and Oklahoma City,93 and 295 names are disallowed for the date of the signature coinciding with the date of the petition's signing.94 Finally, 7,04895 names were successfully challenged on surrebuttal. ¶40 Without considering the more than 75,000 protestant challenges based on non-matching addresses,96 the total number of successful challenges is 80,014. The protestants' signature collection effort failed by a minimum of 638 legally sufficient signatures. Therefore, it is abundantly clear that, even if we had determined to take the narrowest feasible remedy and exclude only the petition sheets of NVO's and other organization's out-of-state circulators rather than to strike the TABOR petition in its entirety, it would be inappropriate for the initiative to go to a vote of the people as an insufficient number of signatures were collected to qualify the proposal for the ballot. CONCLUSION ¶41 There was some evidence in the cockfighting petition -- In re Initiative Petition No. 365, State Question No. 687, 2001 OK 98, 55 P.3d 1048 , opinion withdrawn and superseded on rehearing (on other grounds), 55 P.3d 1048 , 2001 OK 98), rehearing denied (2002) -- of the participation of out-of-state circulators involved in the signature collection process. 7,542 signatures collected by a single circulator who was determined not to be a qualified elector because he was not an Oklahoma resident were struck from the signature count. The cockfighting case was decided in 2001. Five years later, with the circulation of the TABOR petition, in excess of 57,000 votes are being disqualified on the same basis with evidence that there were in excess of 60 out-of-state circulators involved.97 There is no way to determine with any sort of accuracy exactly how many signatures were collected by these out-of state residents as the petition supporters did everything possible to avoid discovery -- even the successful discovery was largely unusable because deponents essentially "couldn't remember" or "didn't know" the information attempting to be elicited. Most certainly, if we do not take the opportunity to address the issue of the effect of out-of-state intrusions into a process reserved to bona fide residents of the State of Oklahoma, the problem will only grow and will present itself as a part of essentially every citizen circulation. ¶42 Excluding all petitions associated with the TABOR initiative does not disenfranchise voters. Rather, it upholds the integrity of the initiative process that has been undermined by criminal wrongdoing and fraud.98 The Legislature has imposed strong sanctions for such wrongdoing.99 NVO and its out-of-state circulators committed much more than mere technical violations of Oklahoma law -- they attempted to destroy the safeguards by which signatures are obtained and verified. Nothing less than the strong sanction of voiding the entire petition will serve to deter similar activity in the future and to protect the precious right of the initiative to Oklahoma voters. Finally, the petition fails for numerical insufficiency. INITIATIVE PETITION No. 379 IS DECLARED INVALID FOR ILLEGALITY AND FRAUD IN THE SIGNATURE COLLECTION PROCESS AND FOR NUMERICAL INSUFFICIENCY OF SIGNERS. WATT, C.J., WINCHESTER, V.C.J., KAUGER, EDMONDSON, TAYLOR, COLBERT, J.J. concur. LAVENDER, HARGRAVE, OPALA, J.J. concur in result. FOOT