Disclosure Digest: Circuit court dismisses group’s challenge of New Mexico disclosure law

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Circuit court dismisses group’s challenge of New Mexico disclosure law

On Feb. 15, the United States Court of Appeals for the Tenth Circuit affirmed a lower court’s dismissal of a lawsuit challenging New Mexico’s disclosure requirements for political action committees. Cowboys for Trump (also known as C4T), a group founded by Otero County Commissioner Couy Griffin (R), filed the original suit after New Mexico Secretary of State Maggie Toulouse Oliver (D) ordered the group to register as a political action committee or pay a fine.

District court lawsuit

In 2019, Oliver ordered Griffin to register C4T as a political committee or pay a $7,800 fine. Under New Mexico’s Campaign Reporting Act, political action committees must disclose donors’ identifying information when the committee makes independent expenditures such as paid advertisements endorsing candidates or supporting or opposing a ballot measure. On June 18, 2020, Griffin filed a complaint with the United States District Court for the District of New Mexico arguing that “compelled disclosure of their donors could lead to substantial personal and economic repercussions for their supporters” and “if their donors are disclosed, their membership and revenue will decline as donors prioritize their anonymity over supporting Plaintiffs’ work.”

On Dec. 30, Judge Gregory J. Fouratt dismissed the case, writing the “Plaintiffs have insisted that they do not engage and have no intention of ever engaging in the types of activities that will trigger disclosure under the CRA. Consequently, C4T’s donors have not suffered an injury in fact and are never expected to suffer any such injury.” The court also ruled the group did not have associational standing. Because the group did not make any independent expenditures requiring disclosure, it suffered no injury and could not sue on its members’ behalf. The court gave the group until Jan. 15, 2021, to file an amended complaint. 

Circuit court appeal

Rather than filing an amended complaint with the district court, Griffin appealed the case to the circuit court on April 20. In the appeal, Griffin’s attorney, Colin L. Hunter, argued Oliver used her “enforcement power to trample the First Amendment right to free speech and association of a high-profile ideological opponent” and that the “(mis)use of an unconstitutional law to silence ideological opponents and hinder their ability to associate with one another to amplify their message is contrary to the First Amendments right to free speech and association.” Griffin’s attorney asked the appeals court to reverse the lower court ruling and dismiss the case.

On May 20, New Mexico’s Assistant Attorneys General Neil R. Bell and Amye G. Green filed a brief in support of the lower court’s ruling. They wrote, “Put simply, C4T has not plausibly alleged that its rights have been chilled when it has ‘affirmatively disclaimed’ any intent or desire to engage in the only conduct that would invoke the CRA’s disclosure and disclaimer requirements.”

In oral arguments held on Jan. 21, 2022, C4T attorney Sidney Powell challenged the group’s designation as a political committee, saying, “I think the fact that the registration requirement is imposed on an LLC that simply provides costs for a man to ride his horse across the country carrying a flag is an amazing burden to impose.” Judge Carolyn McHugh, appointed by former President Barack Obama (D),  said the appeal did not challenge the group’s designation as a political committee or the district court’s decision not to address the issue of registration: “I didn’t see anywhere in the briefing to this court where you take issue with the court’s decision to not address the argument. I’d love it if you could point me to where you challenge the district court’s decision that it need not assess whether there was standing for the registration claim.”

The circuit court upheld the lower court ruling on Feb. 15. In the court’s opinion, Chief Judge Timothy Tymkovich, who was appointed by former President George W. Bush (R), wrote, “Plaintiffs alleged that they had not made and would not make any independent expenditures that would trigger the reporting or disclaimer requirements. Therefore, compelled disclosure of donor information per those requirements is not plausible. Absent a plausible chance of such disclosure, there can be no chilling effect on any donor’s willingness to donate.” 

“It’s a tough decision and an unfair decision because all I’ve tried doing is supporting Trump and standing up for our freedoms,” Griffin said. State Attorney General Hector Balderas said, “All elected officials and dark money groups in this nation must follow election reporting requirements in order to protect the public interest, and no one is above the law.”

What we’ve been reading

• Orlando Sentinel, “Florida opens investigation into dark-money group key to ‘ghost’ candidate scandal,” Jan. 20, 2022
• Philanthropy Roundtable, “New York Legislature Takes Steps to Protect Identities of Donors, Jan. 31, 2022
• The Roanoke Star, “Campaign Finance Legislation Limps through General Assembly, Feb. 16, 2022

The big picture

Number of relevant bills by state: We’re currently tracking 104 pieces of legislation dealing with donor disclosure and privacy. On the map below, a darker shade of green indicates a greater number of relevant bills. Click here for a complete list of all the bills we’re tracking. 

Number of relevant bills by current legislative status: 

Number of relevant bills by partisan status of sponsor(s): 

Recent legislative actions

For complete information on all of the bills we are tracking, click here. 

• California AB1819: This bill would prohibit contributions from a foreign government, foreign principal, or foreign-influenced business entity.
  • Primary emphasis: Disclosure
  • Democratic sponsorship
  • This bill was referred to committee on Feb. 18.
• California AB2528: This bill would require elected officials to file reports electronically with the secretary of state, and these reports would be available for public inspection. 
  • Primary emphasis: Disclosure
  • Republican sponsorship
  • This bill was introduced on Feb. 17.
• California SB1352: This bill would require elected officials and campaign committees to report contributions in excess of $1,000 online to the secretary of state within 72 hours of receiving the contribution. 
  • Primary emphasis: Disclosure
  • Democratic sponsorship
  • This bill was introduced on Feb. 18.
• California SB1360: This bill would require certain political advertisements to identify the top contributors to the campaign committee paying for the advertisement without regard to any minimum contribution threshold.
  • Primary emphasis: Disclosure
  • Democratic sponsorship
  • This bill was introduced on Feb. 18.
• California SB1439:  This bill would change the prohibition on contributions from 3 to 12 months following a decision in a license, permit, or other entitlement for use proceeding and remove the exception for local government agencies.
  • Primary emphasis: Disclosure
  • Democratic sponsorship
  • This bill was introduced on Feb. 18.
• Colorado HB1060: This bill would set limits on contributions to candidates for school district director and require candidates to disclose campaign contribution information to the secretary of state. 
  • Primary emphasis: Disclosure
  • Democratic sponsorship
  • This bill was referred to committee on Feb. 17.
• Kentucky HB301: This bill would require all costs and expenses related to election administration be paid for with public funds and prohibit a state governmental body employee from accepting contributions to assist with election administration unless entered into as a lawful contract.
  • Primary emphasis: Disclosure
  • Republican sponsorship
  • This bill was referred to committee on Feb. 18.
• Maryland HB1343: This bill would require a state contractor to file a disclosure statement with the State Board of Elections if the contractor contributed to a nonprofit organization that funds public communications related to a project in which the contractor has a financial interest.
  • Primary emphasis: Disclosure
  • Democratic sponsorship
  • This bill was referred to committee on Feb. 15.
• Maryland SB15: This bill would allow the state board of elections to impose a civil penalty for failure to report and maintain a record of campaign contributions. It would also prohibit an individual from running for office or becoming the treasurer of a campaign committee if they fail to pay a civil penalty under this section. 
  • Primary emphasis: Disclosure
  • Democratic sponsorship
  • This bill was referred to committee on Feb. 15.

• Minnesota SF3281: This bill would require entities making independent expenditures to name the three individuals or entities making the largest contribution required to be reported under chapter 10A to the expending entity during the 12-month period before the expenditure was published or presented to the public
  • Primary emphasis: Disclosure
  • Democratic sponsorship
  • This bill was introduced on Feb. 17.
• Minnesota SF3283: This bill would prohibit a candidate or political committee from accepting a contribution if in exchange for the contribution the candidate or committee is granted special access to a meeting room, hospitality area, or other event space where public officials are likely to gather.
  • Primary emphasis: Disclosure
  • Democratic sponsorship
  • This bill was referred to committee on Feb. 21.
• Wyoming HB0049: This bill would increase the penalty for failing to file disclosure reports.
  • Primary emphasis: Disclosure
  • Unknown sponsorship
  • This bill was referred to committee on Feb. 15.
• Wyoming HB0080: This bill would require all campaigns and political action committees to file an itemized statement of contributions and expenditures.
  • Primary emphasis: Disclosure
  • Unknown sponsorship
  • This bill was referred to committee on Feb. 15.

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