Opinion ID: 179006
Heading Depth: 2
Heading Rank: 1

Heading: The Right to Associate and Disclosure Requirements

Text: Without question, Colorado election laws place burdens on the right to associate to support or oppose ballot issues. The Colorado Constitution restricts the meaning of issue committee to any person, other than a natural person, or any group of two or more persons, including natural persons. Id. § 2(10)(a). In other words, a single natural person is not subject to the disclosure or reporting requirements imposed on ballot-issue organizations such as the No Annexation committee. (Individuals who expend more than $1000 on electioneering communications within a year or make an independent expenditure exceeding $1000 to support or oppose a candidate are required to make disclosures, see id. §§ 5(1), 6(1); but those requirements do not apply to expenditures for ballot issues, see id. § 2(7) (defining electioneering communication ).) In Citizens Against Rent Control/Coalition for Fair Housing v. City of Berkeley, 454 U.S. 290, 296, 102 S.Ct. 434, 70 L.Ed.2d 492 (1981), the Supreme Court held that a city ordinance burdened freedom of association because an affluent person was subject to no limits on spending to support a ballot measure, but contributions made in concert with others were so restricted. The Court said: There are, of course, some activities, legal if engaged in by one, yet illegal if performed in concert with others, but political expression is not one of them. Id. Reporting and disclosure requirements, just as the limits on contributions in City of Berkeley, can infringe on the right of association. See Buckley v. Valeo, 424 U.S. 1, 64, 96 S.Ct. 612, 46 L.Ed.2d 659 (1976). As stated by Justice Brennan for a plurality in Federal Election Commission v. Massachusetts Citizens for Life, 479 U.S. 238, 254, 107 S.Ct. 616, 93 L.Ed.2d 539 (1986), Detailed record-keeping and disclosure obligations, along with the duty to appoint a treasurer and custodian of records, impose administrative costs that many small entities may be unable to bear. See Citizens United v. Fed. Election Comm'n, ___ U.S. ___, 130 S.Ct. 876, 897-98, ___ L.Ed.2d ___ (2010) (because of the burdens imposed on PACs, contributing through a PAC is an inadequate substitute for direct contributions by the corporation itself); Colo. Right To Life Comm., Inc. v. Coffman, 498 F.3d 1137, 1145 n. 6 (10th Cir.2007) (Colorado constitutional provision requiring corporations to make independent expenditures only through segregated funds ... burdens corporate freedom of expression). Nevertheless, not all burdens on freedom of association are unconstitutional. In particular, disclosure requirements in the electoral context may be upheld if they survive `exacting scrutiny.' Doe v. Reed, ___ U.S. ___, 130 S.Ct. 2811, 2818, 177 L.Ed.2d 493 (2010). That standard requires a substantial relation between the disclosure requirement and a sufficiently important governmental interest. To withstand this scrutiny, the strength of the governmental interest must reflect the seriousness of the actual burden on First Amendment rights. Id. (citation and internal quotation marks omitted). In determining whether these [governmental] interests are sufficient to justify the requirements we must look to the extent of the burden that they place on individual rights. Valeo, 424 U.S. at 68, 96 S.Ct. 612. When analyzing the governmental interest in disclosure requirements, it is essential to keep in mind that our concern is with ballot issues, not candidates. The legitimate reasons for regulating candidate campaigns apply only partially (or perhaps not at all) to ballot-issue campaigns. For example, the Supreme Court has upheld limits on contributions to candidates on the ground that the limits are necessary to avoid the risk or appearance of quid pro quo corruptionthe exchange of a contribution for political favor. See Citizens United, 130 S.Ct. at 901-02; Valeo, 424 U.S. at 45-48, 96 S.Ct. 612 (limits on independent expenditures are unconstitutional because [t]he absence of prearrangement and coordination of an expenditure with the candidate or his agent not only undermines the value of the expenditure to the candidate, but also alleviates the danger that expenditures will be given as a quid pro quo for improper commitments from the candidate). Limits on contributions to ballot-issue committees, in contrast, are unconstitutional because of the absence of any risk of quid pro quo corruption. See McIntyre v. Ohio Elections Comm'n, 514 U.S. 334, 352 n. 15, 115 S.Ct. 1511, 131 L.Ed.2d 426 (1995); City of Berkeley, 454 U.S. at 296-300, 102 S.Ct. 434; First Nat'l Bank of Boston v. Bellotti, 435 U.S. 765, 790, 98 S.Ct. 1407, 55 L.Ed.2d 707 (1978) (The risk of corruption perceived in cases involving candidate elections ... simply is not present in a popular vote on a public issue.); cf. Elam Constr. v. Reg'l Transp. Dist., 129 F.3d 1343 (10th Cir.1997) (invalidating resolution of transportation-district governing body that district would not enter into contracts with companies that have contributed more than $100 to referendum campaigns). [3] As for disclosure requirements specifically, the Supreme Court has recognized three proper justifications for reporting and disclosing campaign finances. The first is that reporting and disclosure requirements are an essential means of gathering the data necessary to detect violations of ... contribution limitations. Valeo, 424 U.S. at 68, 96 S.Ct. 612. The second is that publicizing large contributions and expenditures can deter actual corruption and avoid the appearance of corruption and can facilitate detection of post-election favoritism. Id. at 67, 96 S.Ct. 612. The third justification is an informational interest. Disclosure of contributions and expenditures: allows voters to place each candidate in the political spectrum more precisely than is often possible solely on the basis of party labels and campaign speeches. The sources of the candidate's financial support also alert the voter to the interests to which a candidate is most likely to be responsive and thus facilitates predictions of future performance in office. Id. [4] The first and second grounds do not support reporting and disclosure requirements for ballot-issue committees. The firstfacilitating the detection of violations of contribution limitationsis mooted by the prohibition on contribution limitations in the ballot-issue context. And the seconddeterring corruption and its appearanceis irrelevant because, as our prior discussion has pointed out, quid pro quo corruption cannot arise in a ballot-issue campaign. See Buckley v. Am. Constitutional Law Found., Inc. (ACLF), 525 U.S. 182, 203-04, 119 S.Ct. 636, 142 L.Ed.2d 599 (1999); McIntyre v. Ohio Elections Comm'n, 514 U.S. 334, 352 n. 15, 115 S.Ct. 1511, 131 L.Ed.2d 426; City of Berkeley, 454 U.S. at 296-97, 102 S.Ct. 434; Bellotti, 435 U.S. at 790, 98 S.Ct. 1407. Thus, the reporting and disclosure requirements for Colorado issue committees (at least those committees addressing ballot issues) must be justified on the third groundthe informational interest. We must therefore analyze the public interest in knowing who is spending and receiving money to support or oppose a ballot issue. It is not obvious that there is such a public interest. Candidate elections are, by definition, ad hominem affairs. The voter must evaluate a human being, deciding what the candidate's personal beliefs are and what influences are likely to be brought to bear when he or she must decide on the advisability of future governmental action. The identities of those with strong financial ties to the candidate are important data in that evaluation. In contrast, when a ballot issue is before the voter, the choice is whether to approve or disapprove of discrete governmental action, such as annexing territory, floating a bond, or amending a statute. No human being is being evaluated. When many complain about the deterioration of public discoursein particular, the inability or unwillingness of citizens to listen to proposals made by particular people or by members of particular groupsone could wonder about the utility of ad hominem arguments in evaluating ballot issues. Nondisclosure could require the debate to actually be about the merits of the proposition on the ballot. Indeed, the Supreme Court has recognized that [a]nonymity... provides a way for a writer who may be personally unpopular to ensure that readers will not prejudge her message simply because they do not like its proponent. McIntyre, 514 U.S. at 342, 115 S.Ct. 1511. The Supreme Court has sent a mixed message regarding the value of financial disclosure in a ballot-issue campaign. Perhaps its view can be summarized as such disclosure has some value, but not that much. Although the Court has never rejected a First Amendment challenge to a financial-disclosure requirement in the ballot-issue context, on three occasions it has spoken favorably of such requirements. First, in Bellotti the Court invalidated a Massachusetts statute prohibiting corporate expenditures in ballot-issue campaigns. 435 U.S. at 767, 98 S.Ct. 1407. As previously noted, the Court stated that the risk of quid pro quo corruption is not present in such campaigns, id. at 790, 98 S.Ct. 1407, and it observed that the voters are entrusted with the responsibility for judging and evaluating the relative merits of conflicting arguments. Id. at 791, 98 S.Ct. 1407. But it went on to say that the people may consider, in making their judgment, the source and credibility of the advocate, id. at 791-92, 98 S.Ct. 1407, and appended a footnote saying that [i]dentification of the source of advertising may be required as a means of disclosure, so that people will be able to evaluate the arguments to which they are being subjected, id. at 792 n. 32, 98 S.Ct. 1407. Second, in City of Berkeley the Court similarly invalidated a municipal ordinance setting a cap on contributions to committees supporting or opposing ballot measures. See 454 U.S. at 291-94, 102 S.Ct. 434. In response to the City's argument that the contribution cap was necessary to identify those supporting or opposing a ballot measure, the Court said that the cap was not necessary because another provision in the ordinance required disclosure. The Court wrote, The integrity of the political system will be adequately protected if contributors are identified in a public filing revealing the amounts contributed; if it is thought wise, legislation can outlaw anonymous contributions. Id. at 299-300, 102 S.Ct. 434. More recently, in ACLF the Court expressed approval for disclosure requirements when it struck several provisions in a Colorado statute regulating the circulation of petitions to place initiatives on the ballot. 525 U.S. at 202-03, 119 S.Ct. 636. One issue before the Court was a statutory requirement to disclose the names of paid circulators and the amounts paid to each circulator. The Court, without distinguishing between candidate and ballot-issue campaigns, wrote: We explained in Buckley that disclosure provides the electorate with information as to where political campaign money comes from and how it is spent, thereby aiding electors in evaluating those who seek their vote. We further observed that disclosure requirements deter actual corruption and avoid the appearance of corruption by exposing large contributions and expenditures to the light of publicity.... [T]he State and supporting amici stress the importance of disclosure as a control or check on domination of the initiative process by affluent special interest groups.... Disclosure of the names of initiative sponsors, and of the amounts they have spent gathering support for their initiatives, responds to that substantial state interest.... Through the disclosure requirements that remain in place, voters are informed of the source and amount of money spent by proponents to get a measure on the ballot; in other words, voters will be told who has proposed a measure, and who has provided funds for its circulation. Id. (citations, brackets and internal quotation marks omitted). The Court also wrote: To inform the public `where [the] money comes from,' Buckley, 424 U.S. at 66, 96 S.Ct. 612 (internal quotation marks omitted), we reiterate, the State legitimately requires sponsors of ballot initiatives to disclose who pays petition circulators, and how much. Id. at 205, 96 S.Ct. 612. The disclosure requirements referred to in these passages, however, were not challenged in the case before the Court. The disclosure requirements that were challengedthe disclosure of the names of paid circulators and the amounts paid to eachwere stricken because they could not be justified by the benefit they might add to the unchallenged disclosure requirements. See id. at 202-03, 96 S.Ct. 612. Thus, in all three cases the statements by the Supreme Court supporting disclosures in ballot-issue campaigns were dicta. The Court has never upheld a disclosure provision for ballot-issue campaigns that has been presented to it for review. Of course, this court takes Supreme Court dictum very seriously. United States v. Serawop, 505 F.3d 1112, 1122 (10th Cir. 2007) (we are bound by Supreme Court dicta almost as firmly as by the Court's outright holdings (internal quotation marks omitted)). But the absence of the precise and careful analysis necessary to resolve a particular issue fully presented to the Court makes it difficult for us to assess the weight that should be granted the public interest in disclosure when balancing it against the burden on the First Amendment right of association imposed by a particular statute in a particular circumstance. The difficulty is especially great when the Court has also suggested the limits of the public interest in disclosure in the ballot-issue context. In McIntyre the Court meticulously distinguished its precedents affirming disclosure requirements in candidate elections as it overturned a fine for distributing anonymous pamphlets opposing a school tax levy. See 514 U.S. at 353-56, 115 S.Ct. 1511. And it quoted the following passage from a New York court that struck down a similar statute: Of course, the identity of the source is helpful in evaluating ideas. But the best test of truth is the power of the thought to get itself accepted in the competition of the market. Don't underestimate the common man. People are intelligent enough to evaluate the source of an anonymous writing. They can see it is anonymous. They know it is anonymous. They can evaluate its anonymity along with its message, as long as they are permitted, as they must be, to read that message. And then, once they have done so, it is for them to decide what is responsible, what is valuable, and what is truth. Id. at 348 n. 11, 115 S.Ct. 1511 (citation and internal quotation marks omitted); cf. Bellotti, 435 U.S. at 777, 98 S.Ct. 1407 (The inherent worth of the speech in terms of its capacity for informing the public does not depend upon the identity of its source, whether corporation, association, union, or individual.) We also find it significant that in the recent decision in Doe v. Reed, ___ U.S. ___, 130 S.Ct. 2811, 177 L.Ed.2d 493, the Court affirmed a state law requiring disclosure of referendum petitions without reliance on the State's asserted interest in providing information to the electorate about who supports the petition. See id. at 2819. Rather, the court relied on the utility of disclosure in preserving the integrity of the electoral process. See id. at 2819-21. The concurring opinion of Justice Alito pointed out the breathtaking implications of the State's contention that publicly disclosing the names and addresses of referendum signatories provides the voting public with `insight into whether support for holding a vote comes predominantly from particular interest groups, political or religious organizations, or other group[s] of citizens,' and thus allows voters to draw inferences about whether they should support or oppose the referendum. Id. at 2824 (quoting Brief for Respondent Washington Families Standing Together 58). He continued: Were we to accept respondents' asserted informational interest, the State would be free to require petition signers to disclose all kinds of demographic information, including the signer's race, religion, political affiliation, sexual orientation, ethnic background, and interest-group memberships. Requiring such disclosures, however, runs headfirst into a half-century of our case law, which firmly establishes that individuals have a right to privacy of belief and association. Id. To be sure, typical financial-disclosure laws are not nearly as sweeping as the types of requirements hypothesized by Justice Alito. They require disclosure of only name and address, and sometimes employment. But by the same token, they reveal only one dimension of the support for a ballot measure. Their purpose is not to inform the electorate about all who believe that a particular result is in the public interest; volunteers who devote many hours to grassroots work need not be identified. Rather, their only purpose is to identify those who (presumably) have a financial interest in the outcome of the election. See Canyon Ferry Baptist Church v. Unsworth, 556 F.3d 1021, 1033 (9th Cir.2009) ([T]he relevant informational goal is to inform voters as to who backs or opposes a given initiative financially, so that the voters will have a pretty good idea of who stands to benefit from the legislation. (internal quotation marks omitted)). This limited purpose must be kept in mind when evaluating the constitutionality of a particular financial-disclosure requirement. Accordingly, while assuming that there is a legitimate public interest in financial disclosure from campaign organizations, we also recognize that this interest is significantly attenuated when the organization is concerned with only a single ballot issue and when the contributions and expenditures are slight. We now proceed to weigh that interest against the First Amendment right of association in the context of this case.