CALIFORNIANS FOR FAIR REPRESENTATION v. SUPERIOR COURT

Filed: 3/29/06

CERTIFIED FOR PUBLICATION

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

THIRD APPELLATE DISTRICT

(Sacramento)

----

ORIGINAL PROCEEDING in mandate. Thomas J. Cecil, Judge. Writ denied.

Olson, Hagel & Fishburn, Deborah B. Caplan, Lance H. Olson and Richard C. Miadich for Petitioners.

No appearance for Respondent.

Bell, McAndrews & Hiltachk, Charles H. Bell, Thomas W. Hiltachk and Jimmie E. Johnson for Real Parties in Interest.

Just prior to the special election of November 8, 2005, petitioners Californians for Fair Representation--No on 77 (hereafter CFR--No on 77) and Theresa Faye Jang-Hefner (collectively, petitioners) petitioned this court for a peremptory writ of mandate, prohibition or other extraordinary relief. They sought to compel respondent the Superior Court of Sacramento County to vacate its order denying a temporary restraining order and preliminary injunction to require real parties in interest, Governor Arnold Schwarzenegger, Governor Schwarzenegger's California Recovery Team (hereafter CRT), Redistrict California--Yes on 77 (hereafter Redistrict--Yes on 77) and Steve Poizner (collectively, real parties in interest), to comply with 24-hour disclosure requirements for contributions and independent expenditures imposed by the Political Reform Act of 1974 (PRA) (Gov. Code, § 81000 et seq.).^[1]

After real parties in interest voluntarily complied with the disclosure requirements, this court issued an alternative writ of mandate on November 4, 2005, but denied the request for immediate relief as moot. Petitioners contend real parties in interest's initial refusal to report as contributions or independent expenditures the million of dollars spent on radio and television advertising in support of Propositions 74, 75, 76 and 77 violated the PRA. Real parties in interest contend the case is moot because the reports have been filed and the issue is not one likely to evade review. Further, they contend there was no basis for a preliminary injunction as there was no irreparable injury and petitioners had no likelihood of prevailing on the merits.

We conclude that although the issue is technically moot, we shall exercise our discretion to decide it because it is an important issue of public interest, likely to recur and evade appellate review. We further conclude that the expenditures admittedly made by CRT meet the statutory definition of independent expenditures and should have been reported on a 24-hour basis during the 90 days before the election.

FACTUAL AND PROCEDURAL BACKGROUND

Many of the parties in this case are committees as defined by the PRA, so we begin by identifying the various types of committees. A committee is one or more persons who directly or indirectly receives contributions of $1,000 or more in a calendar year, makes independent expenditures of $1,000 or more in a calendar year, or makes contributions of $10,000 or more in a calendar year to or at the behest of candidates or committees. (§ 82013.) A controlled committee is a committee controlled directly or indirectly by a candidate or state measure proponent. (§ 82016, subd. (a).) A candidate or state measure proponent controls a committee if he or she has a significant influence on the actions or decisions of the committee. (Ibid.)

Committees are divided into two groups based on the purpose for which the committee is formed. A primarily formed committee is formed or exists to support or oppose one or more candidates or one or more measures being voted upon in the same election. (§ 82047.5.) A general purpose committee generally is formed or exists to support or oppose candidates or measures in several different elections. (§ 82027.5, subd. (a).)

Petitioner CFR--No on 77 is a committee primarily formed to oppose Proposition 77 in the November 2005 special election.^[2] Petitioner Theresa Faye Jang-Hefner is a registered California voter.

Real party in interest Arnold Schwarzenegger is the Governor of California and a candidate for reelection to that office; he controls real party in interest CRT, a general purpose committee. Real party in interest Redistrict--Yes on 77 is a committee primarily formed to support Proposition 77 and is controlled by real party in interest Steve Poizner, a candidate for State Insurance Commissioner.

On October 7, 2005, petitioners filed a complaint for temporary and permanent injunction against real parties in interest, challenging the legality of contributions totaling $1,750,000 made by Governor Schwarzenegger and CRT to Redistrict--Yes on 77. They also filed an ex parte application for a temporary restraining order.

In a preliminary opposition, real parties in interest argued there was no harm justifying an injunction because the contributions had been returned. They further argued that any limitation on the amount an individual could contribute to a ballot measure committee was unconstitutional.

At a hearing on the application for a temporary restraining order, real parties in interest provided documentation that the contributions at issue had been refunded. In response to petitioners' argument that CRT had made in-kind contributions to Redistrict--Yes on 77, the treasurer of CRT declared that CRT made expenditures in support of Proposition 77, but that these expenditures were not â€