Free Motion for TRO - District Court of California - California

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1 PAUL J. BEARD II, No. 210563 E-mail: [email protected] 2 DAMIEN M. SCHIFF, No. 235101 E-mail: [email protected] 3 BRANDON M. MIDDLETON, No. 255699 E-mail: [email protected] 4 Pacific Legal Foundation 3900 Lennane Drive, Suite 200 5 Sacramento, California 95834 Telephone: (916) 419-7111 6 Facsimile: (916) 419-7747 7 Attorneys for Plaintiffs 8 9 10
3900 Lennane Drive, Suite 200 Sacramento, CA 95834 (916) 419-7111 FAX (916) 419-7747

UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF CALIFORNIA

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11 12 MERCER, FRASER CO., a California corporation; and ) No. CV 08-4098-SI O & M INDUSTRIES, a California corporation, ) 13 ) MEMORANDUM OF Plaintiffs, ) POINTS AND AUTHORITIES 14 ) IN SUPPORT OF PLAINTIFFS' v. ) APPLICATION FOR 15 ) TEMPORARY RESTRAINING COUNTY OF HUMBOLDT, CALIFORNIA, a ) ORDER AND ORDER TO SHOW 16 political subdivision of the State of California, ) CAUSE RE: PRELIMINARY ) INJUNCTION 17 Defendant. ) ) Judge: Hon. Susan Illston 18 Courtroom 10, 19th Floor Time: 19 Date: 20 21 22 23 24 25 26 27 28
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TABLE OF CONTENTS Page

3 TABLE OF AUTHORITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ii 4 MEMORANDUM OF POINTS AND AUTHORITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 5 INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 6 FACTUAL BACKGROUND . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 7 LEGAL STANDARD . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 8 ARGUMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 9 10
3900 Lennane Drive, Suite 200 Sacramento, CA 95834 (916) 419-7111 FAX (916) 419-7747

I. PLAINTIFFS WILL SUFFER IRREPARABLE INJURY IF DEFENDANT IS NOT IMMEDIATELY RESTRAINED FROM ENFORCING MEASURE T, AND THUS THE BALANCE OF HARMS WEIGHS IN PLAINTIFFS' FAVOR . . . . . . . . . 4 II. PLAINTIFFS ARE LIKELY TO SUCCEED ON THE MERITS OF THEIR CLAIM THAT MEASURE T VIOLATES THE RIGHTS TO FREEDOM OF SPEECH AND EQUAL PROTECTION OF THE LAWS SECURED BY THE FIRST AND FOURTEENTH AMENDMENTS . . . . . . . . . . . . . . 6 A. Legal Framework for First Amendment Protection of Corporate Political Speech . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 B. Because Measure T's Prohibitions Are Neither Narrowly Tailored To Achieve a Compelling Governmental Interest, Nor Closely Drawn To Match a Sufficiently Important Interest, Measure T Is Unconstitutional . . . . . . . . . 8 C. Because Measure T's Prohibitions Do Not Even Serve a Compelling or Important Government Interest, Its Corporate Political Speech Limitations Are Unconstitutional . . . . . . . . . . . . . . . . . . . . . . . . . 10 D. Because Measure T's Classifications Burdening Free Speech Rights Are Not Narrowly Tailored To Achieve a Compelling State Interest, They Are Unconstitutional . . . . . . . . . . . . . . . . . . . . . . 12 III. THE PUBLIC INTEREST FAVORS PRELIMINARY EQUITABLE RELIEF . . . . . 14

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11 12 13 14 15 16 17 18 19 20 21

22 IV. THE BOND REQUIREMENT SHOULD BE WAIVED, OR BOND SHOULD BE SET AT A NOMINAL AMOUNT . . . . . . . . . . . . . . . . . . . . . . . 15 23 CONCLUSION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 24 25 26 27 28
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TABLE OF AUTHORITIES Page Cases

4 Austin v. Mich. Chamber of Commerce, 494 U.S. 652 (1990) . . . . . . . . . . . . . . . 6, 8-10, 12-13 5 Barahona-Gomez v. Reno, 167 F.3d 1228 (9th Cir. 1999) . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 6 Bartels v. Biernat, 405 F. Supp. 1012 (E.D. Wis. 1975) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 7 Buckley v. Valeo, 424 U.S. 1 (1976) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7, 9 8 California ex rel. Van De Kamp v. Tahoe Regional Planning Agency, 766 F.2d 1319 (9th Cir. 1985) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 9 Chabad of Southern Ohio & Congregation Lubavitch v. City of Cincinnati, 10 363 F.3d 427 (6th Cir. 2004) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
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11 Earth Island Inst. v. U.S. Forest Serv., 351 F.3d 1291 (9th Cir. 2003) . . . . . . . . . . . . . . . . . . 3-4 12 Elrod v. Burns, 427 U.S. 347 (1976) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4-5 13 Fed. Election Comm'n v. Beaumont, 539 U.S. 146 (2003) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 14 Fed. Election Comm'n v. Nat'l Conservative Political Action Comm., 470 U.S. 480 (1985) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7-8, 10 15 Fed. Election Comm'n v. Wisconsin Right to Life, Inc., 127 S. Ct. 2652 (2007) . . . . . . . 7, 9-10 16 First Nat'l Bank of Boston v. Bellotti, 435 U.S. 765 (1978) . . . . . . . . . . . . . . . . . . . . . 6, 8-9, 11 17 Gitlow v. New York, 268 U.S. 652 (1925) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 18 Grosjean v. Am. Press Co., 297 U.S. 233 (1936) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 19 Heckler v. Mathews, 465 U.S. 728 (1984) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 20 Mardi Gras of San Luis Obispo v. City of San Luis Obispo, 21 189 F. Supp. 2d 1018 (C.D. Cal. 2002) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 22 McConnell v. Fed. Election Comm'n, 540 U.S. 93 (2003) . . . . . . . . . . . . . . . . . . . . . . . . . 6-7, 9 23 McIntyre v. Ohio Elections Comm'n, 514 U.S. 334 (1995) . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 24 Monterey County Democratic Cent. Comm. v. United States Postal Serv., 812 F.2d 1194 (9th Cir. 1987) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6, 15 25 NAACP v. Button, 371 U.S. 415 (1963) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 26 Napa Valley Publishing Co. v. City of Calistoga, 27 225 F. Supp. 2d 1176 (N.D. Cal. 2002) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4, 15 28
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2 One World One Family Now, Inc. v. City of Key West, 852 F. Supp. 1005 (S.D. Fla. 1994) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 3 One World One Family Now, Inc. v. Nevada, 860 F. Supp. 1457 (D. Nev. 1994) . . . . . . . . . 14 4 Phelps-Roper v. Nixon, 509 F.3d 480 (8th Cir. 2007) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 5 Reynolds v. Sims, 377 U.S. 533 (1964) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 6 Rice v. Cayetano, 941 F. Supp. 1529 (D. Haw. 1996), 7 aff'd, 146 F.3d 1075 (9th Cir. 1998) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 8 Richey v. Tyson, 120 F. Supp. 2d 1298 (S.D. Ala. 2000) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 9 Romer v. Evans, 517 U.S. 620 (1996) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 10 S.O.C., Inc. v. County of Clark, Nev., 152 F.3d 1136 (9th Cir. 1998) . . . . . . . . . . . . . . . . . . . 4-5
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11 Sammartano v. First Judicial District Court, 303 F.3d 959 (9th Cir. 2002) . . . . . . . . . . . . . . 15 12 Save Our Sonoran, Inc. v. Flowers, 408 F.3d 1113 (9th Cir. 2005) . . . . . . . . . . . . . . . . . . . . 15 13 Sioux City Bridge Co. v. Dakota County, 260 U.S. 441 (1923) . . . . . . . . . . . . . . . . . . . . . . . 12 14 Smith v. Board of Elec. Comm'rs for City of Chicago, 591 F. Supp. 70 (N.D. Ill. 1984) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 15 Telemundo of Los Angeles v. City of Los Angeles, 16 283 F. Supp. 2d 1095 (C.D. Cal. 2003) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 17 Village of Willowbrook v. Olech, 528 U.S. 562 (2000) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 18 Virginia v. Hicks, 539 U.S. 113 (2003) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 19 Westfield High School L.I.F.E. Club v. City of Westfield, 249 F. Supp. 2d 98 (D. Mass. 2003) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 20 Constitution 21 U.S. Const. amend. I . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 22 U.S. Const. amend. XIV . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 23 U.S. Const. amend. XIV, § 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 24 Statute 25 29 U.S.C. § 152(5) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 26 27 28
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3 Fed. R. Civ. P. 65 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 4 Fed. R. Civ. P. 65(b)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 5 Fed. R. Civ. P. 65(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 6 Local Civil Rule 65-1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 7 Miscellaneous

8 Gary Peller, Cultural Imperialism, White Anxiety, and the Ideological Realignment of Brown, in Race, Law & Culture 9 (Austin Surat ed. 1997) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 10
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MEMORANDUM OF POINTS AND AUTHORITIES INTRODUCTION Plaintiffs Mercer, Fraser Co. and O & M Industries want to express their political views

4 in the upcoming November 4, 2008, General Election in Humboldt County, but they are forbidden 5 by law from doing so. The recently enacted "Humboldt County Ordinance to Protect Our Rights 6 to Fair Elections and Local Democracy," known as Measure T, arbitrarily bans all political speech 7 by non-local corporations, including by Plaintiffs. In their complaint, Plaintiffs challenge the 8 constitutionality of Measure T, contending that it violates Plaintiffs' political free speech rights 9 under the First and Fourteenth Amendments to the United States Constitution, as well as Plaintiffs' 10 right to be free from arbitrary, irrational, and speech-burdening regulation under the Equal
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11 Protection Clause of the Fourteenth Amendment. In light of the scope of Measure T's ban, and 12 the settled law that gives substantial protection even to corporate political speech, Plaintiffs have 13 a strong probability of prevailing on their claims. 14 But Plaintiffs cannot wait for the resolution of the merits of this case to vindicate their

15 rights, because the upcoming County election on November 4, 2008, involves issues and 16 candidacies of considerable importance to them, and on which they are ready and able to express 17 their views. Measure T is presently chilling, during the current election season, the protected 18 political speech of Plaintiffs and other "non-local corporations." Preliminary equitable relief is 19 therefore necessary to avoid irreparable injury to Plaintiffs and similarly situated corporations. 20 Moreover, such relief would directly serve the public interest, and, given the First Amendment 21 freedoms that are at stake, would harm no one. 22 Therefore, Plaintiffs respectfully request that the Court grant their application, pursuant to

23 Federal Rule of Civil Procedure (FRCP) 65, and Local Civil Rule 65-1, for a temporary restraining 24 order (TRO) and preliminary injunction enjoining enforcement of Measure T. 25 26 FACTUAL BACKGROUND On June 6, 2006, the voters of Humboldt County approved Measure T. See First Am.

27 Compl. Exh. 1. Listed under Measure T's "Findings and General Purpose" are the brazen 28 assertions that:
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(2) Only natural persons possess civil and political rights. Corporations are creations of state law and possess no legitimate civil or political rights. (3) Courts have illegitimately defined corporations as "persons," allegedly vesting corporations with constitutional protections and rights. The unconstitutional doctrines of "corporate personhood" and "corporate constitutional rights" illegitimately deny the people of Humboldt County the ability to exercise our fundamental political rights.

6 See id. § 3, subparas. 2-3. The stated specific purpose of Measure T is "to prohibit non-local 7 corporations from making direct or indirect contributions and independent expenditures in all 8 elections within the jurisdiction of Humboldt County." Id. § 4. 9 A "local corporation," to which the provisions of Measure T do not apply, is defined as a

10 corporation in which all employees reside in Humboldt County, the corporation's principal place
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11 of business and headquarters are located in Humboldt County, all shareholders reside in Humboldt 12 County, and no shareholder is a corporation. Id. § 11. A "local labor organization," which is also 13 exempt, is defined as a labor organization, qualifying as such under the National Labor Relations 14 Act, in which at least one member resides in Humboldt County. See id. Measure T makes no 15 distinction between incorporated and unincorporated local labor organizations. See id. 16 Measure T prohibits a non-local corporation from contributing or expending anything of

17 value, directly or indirectly, to promote or defeat the candidacy of any person for a local office, 18 or to promote or defeat any local initiative, referendum, or recall election. Id. § 5. Measure T 19 imposes a penalty of ten times the amount illegally contributed or expended. It also directs the 20 district attorney to initiate corporate charter revocation proceedings if the amount illegally 21 contributed or expended exceeds $25,000. Id. § 12. Although providing several "legislative" 22 findings decrying the supposed baneful effect of corporations on local elections, see id. §§ 4-8, 23 Measure T contains no findings supporting the assertion that non-labor-oriented corporations have 24 any worse effect on local elections than incorporated labor organizations. 25 Plaintiff Mercer, Fraser Co. is a corporation organized under the laws of the State of

26 California. See Declaration of Justin Zabel (Zabel Decl.), ¶ 2. Mercer's current corporate charter 27 was issued by the Secretary of State in 1948. Id. Mercer is a successful asphalt paving, highway 28 and heavy construction business located in Eureka, California. Id. Approximately 98 percent of
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1 Mercer's employees live in Humboldt County. Id. ¶ 3. Nevertheless, under Measure T, Mercer 2 is a non-local corporation. 3 Plaintiff O & M Industries is also a corporation organized under the laws of the State of

4 California. See Declaration of Rob McBeth (McBeth Decl.), ¶ 2. O & M's current corporate 5 charter was issued by the Secretary of State in 1972. Id. O & M is a successful manufacturer 6 focusing on steel fabrication and heat, ventilation, and air conditioning systems. Id.

7 Approximately three quarters of O & M's employees live in Humboldt County. Id. ¶ 3. Under 8 Measure T, O & M is considered a non-local corporation. 9 Both Mercer and O & M have a present desire to speak in the upcoming November, 2008,

10 general election in Humboldt County. Specifically, both would contribute and expend money or
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11 other things in value in connection with the race for the Second District Board of Supervisors seat 12 for Humboldt County. Zabel Decl. ¶ 4; McBeth Decl. ¶ 4. Yet neither will speak in the upcoming 13 general election for fear of prosecution for violation Measure T. Zabel Decl. ¶ 6; McBeth Decl. 14 ¶ 6. Absent a TRO and preliminary injunction forbidding enforcement of Measure T pending 15 resolution of this case, Plaintiffs and other similarly situated corporations will be prohibited from 16 expressing their political views on issues of significant import to their businesses, employees, and 17 customers. 18 19 LEGAL STANDARD FRCP 65 governs the district courts' issuance of preliminary equitable relief. Consistent

20 with that Rule, to obtain a TRO or preliminary injunction, 21 22 23 24 25 26 27 28
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a plaintiff must show "(1) a strong likelihood of success on the merits, (2) the possibility of irreparable injury to plaintiff if preliminary relief is not granted, (3) a balance of hardships favoring the plaintiff, and (4) advancement of the public interest (in certain cases)." Johnson v. Cal. State Bd. of Accountancy, 72 F.3d 1427, 1430 (9th Cir. 1995). Alternatively, a court may grant the injunction if the plaintiff "demonstrates either a combination of probable success on the merits and the possibility of irreparable injury or that serious questions are raised and the balance of hardships tips sharply in his favor." Id. (citations omitted) (emphasis in original). "These two alternatives represent `extremes of a single continuum,' rather than two separate tests." Clear Channel Outdoor, Inc. v. City of Los Angeles, 340 F.3d 810 (9th Cir. 2003). "Thus, the greater the relative hardship to [the party seeking the preliminary injunction,] the less probability of success must be shown." Id. (citation omitted) (alteration in original).

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1 Earth Island Inst. v. U.S. Forest Serv., 351 F.3d 1291, 1297-98 (9th Cir. 2003). The standard for 2 granting a TRO is the same as that for a preliminary injunction. See Rice v. Cayetano, 941 F. 3 Supp. 1529, 1537 (D. Haw. 1996), aff'd, 146 F.3d 1075 (9th Cir. 1998). Although normally a TRO 4 must expire within ten days of its issuance, a district court may, for good cause shown, extend the 5 TRO's application. See FRCP 65(b)(2). 6 When First Amendment freedoms are concerned, the requirements for preliminary

7 equitable relief are more easily met. First, any unconstitutional speech restriction, lasting for even 8 a short period of time, constitutes an irreparable injury supporting such relief. See Elrod v. Burns, 9 427 U.S. 347, 373 (1976) (plurality opinion) ("The loss of First Amendment freedoms, for even 10 minimal periods of time, unquestionably constitutes irreparable injury."); S.O.C., Inc. v. County
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11 of Clark, Nev., 152 F.3d 1136, 1148 (9th Cir. 1998) (same); see also Telemundo of Los Angeles 12 v. City of Los Angeles, 283 F. Supp. 2d 1095, 1103 (C.D. Cal. 2003); Napa Valley Publishing Co. 13 v. City of Calistoga, 225 F. Supp. 2d 1176, 1197-98 (N.D. Cal. 2002); Mardi Gras of San Luis 14 Obispo v. City of San Luis Obispo, 189 F. Supp. 2d 1018, 1035-36 (C.D. Cal. 2002). 15 Second, the public-interest factor weighs heavily in favor of granting preliminary equitable

16 relief in free-speech cases. In Napa Valley, a newspaper publishing company brought a First 17 Amendment challenge to a local ordinance requiring permits to install newsracks and limiting the 18 number of newsracks at certain locations. Napa Valley, 225 F. Supp. 2d at 1179. The company 19 applied for a preliminary injunction, and this Court granted it in part, observing that "[c]ourts have 20 consistently recognized the public interest in safeguarding First Amendment rights." Id. at 1197. 21 22 23 24 25 26 Plaintiffs will suffer irreparable harm if a temporary restraining order does not issue at this ARGUMENT I PLAINTIFFS WILL SUFFER IRREPARABLE INJURY IF DEFENDANT IS NOT IMMEDIATELY RESTRAINED FROM ENFORCING MEASURE T, AND THUS THE BALANCE OF HARMS WEIGHS IN PLAINTIFFS' FAVOR

27 time. In just two months, the November 4, 2008, election will take place. The upcoming election 28 includes many County and municipal issues and candidacies of importance to Plaintiffs. If they
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1 are to have any impact on the these issues, Plaintiffs must be able to participate--through 2 contributions and expenditures--in the political process. Plaintiffs are ready, willing, and 3 financially capable of participating. See Zabel Decl. ¶ 4; McBeth Decl. ¶ 4. But Measure T 4 silences Plaintiffs, and Plaintiffs will not participate in this election for fear of prosecution for 5 violation of Measure T's prohibitions. Zabel Decl. ¶ 6; McBeth Decl. ¶ 6. 6 Plaintiffs are non-local corporations under Measure T and are therefore subject to

7 Measure T's total prohibition on "non-local corporation" political expenditures and contributions. 8 Plaintiffs are presently and continuously injured by Measure T's total ban on nonlocal corporation 9 campaign contributions and expenditures because Plaintiffs are and will continue to be unable to 10 participate in any meaningful way in any upcoming local election by directly and indirectly
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11 supporting and opposing candidates, referenda, initiatives, and the like through contributions and 12 expenditures. Specifically, Plaintiffs will be unable to contribute and expend money or other 13 things of value in connection with the race for the Second District Board of Supervisors seat for 14 Humboldt County. Zabel Decl. ¶ 4; McBeth Decl. ¶ 4. Adjudication of Plaintiffs' claims cannot 15 be obtained in the normal course, owing to the ongoing election season and the imminence of the 16 November, 2008, general election. Preliminary injunctive relief is particularly appropriate in this 17 case, where fundamental speech rights are at issue. See Elrod, 427 U.S. at 373 (plurality opinion) 18 ("The loss of First Amendment freedoms, for even minimal periods of time, unquestionably 19 constitutes irreparable injury."); S.O.C., Inc. v. County of Clark, Nev., 152 F.3d at 1148 (same). 20 On the other hand, the County and the public will suffer little to no harm if Plaintiffs and

21 others similarly situated are permitted to engage in political speech this election season, pending 22 the resolution of the merits of this case. Plaintiffs themselves are businesses in excellent standing 23 in the County. See Zabel Decl. ¶ 2; McBeth Decl. ¶ 2. Neither has ever been accused or found 24 guilty of any corruption of a County campaign or election. Nor is there any evidence--either in 25 Measure T or anywhere else--that "non-local" corporations have had a corrupting influence 26 on politics with the County at any time prior to the law's passage. The irrational biases against 27 non-local corporations that are reflected in Measure T's "legislative findings" fail to establish 28 ///
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1 otherwise. Therefore, the balance of harms decidedly favors the granting of a TRO and 2 preliminary injunction. 3 4 5 6 II PLAINTIFFS ARE LIKELY TO SUCCEED ON THE MERITS OF THEIR CLAIM THAT MEASURE T VIOLATES THE RIGHTS TO FREEDOM OF SPEECH AND EQUAL PROTECTION OF THE LAWS SECURED BY THE FIRST AND FOURTEENTH AMENDMENTS

7 A. Legal Framework for First Amendment Protection of Corporate Political Speech 8 9 The First Amendment to the United States Constitution provides, in relevant part, that

10 "Congress shall make no law . . . abridging the freedom of speech." U.S. Const. amend. I. The
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11 same prohibition is applied to state and local governments by the First Amendment's incorporation 12 into the Fourteenth Amendment. U.S. Const. amend. XIV. Like the federal government, state and 13 local governments may not abridge the right to free speech. Gitlow v. New York, 268 U.S. 652, 14 666 (1925). The freedom of speech is considered one of the Nation's most sacred rights. See 15 Monterey County Democratic Cent. Comm. v. United States Postal Serv., 812 F.2d 1194, 1196 (9th 16 Cir. 1987) ("The values embodied in the First Amendment . . . constitut[e] the hallmark of free 17 societies."). 18 It is well established that corporations enjoy the speech protections of the First

19 Amendment, just as noncorporate persons do. See First Nat'l Bank of Boston v. Bellotti, 435 U.S. 20 765, 784 (1978); NAACP v. Button, 371 U.S. 415, 428-29 (1963); Grosjean v. Am. Press Co., 297 21 U.S. 233, 244 (1936). But the level of First Amendment protection afforded to corporations 22 engaged in campaign speech is less than it is for individuals. The government may restrict a 23 corporation's ability to contribute to or expend monies or things of value in connection with 24 elections, so long as the restriction passes constitutional muster. See, e.g., Austin v. Mich. 25 Chamber of Commerce, 494 U.S. 652 (1990) (upholding state statute banning direct corporate 26 expenditures in favor of or against candidates for state office); McConnell v. Fed. Election 27 Comm'n, 540 U.S. 93, 206 (2003) (upholding Bipartisan Campaign Reform Act's (BCRA) 28 limitation of corporate-funded "express advocacy" and "functional equivalent" ads).
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1

The constitutional tests that the courts apply to regulations of corporate campaign speech Courts distinguish between corporate

2 differ according to the type of speech at issue.

3 contributions--which are monies given to a campaign that are spent for political speech--and 4 corporate expenditures--which are monies spent by the corporation itself for its own political 5 speech. See Buckley v. Valeo, 424 U.S. 1, 20-21 (1976). Contribution limitations are subject to 6 lesser scrutiny than expenditure limitations. The distinction is justified on the belief that, "[w]hile 7 contributions may result in political expression if spent by a candidate or association . . . , the 8 transformation of contributions into political debate involves speech by someone other than the 9 contributor." Fed. Election Comm'n v. Beaumont, 539 U.S. 146, 161-62 (2003) (quoting Buckley, 10 424 U.S. at 20-21).
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11

Limitations on corporate campaign contributions are constitutional if they are closely

12 drawn to match a sufficiently important interest. Beaumont, 539 U.S. at 162. Only the 13 government's interest in preventing actual or apparent corruption in elections has been found 14 sufficiently important to justify contribution limitations. As the United States Supreme Court has 15 explained, "preventing corruption or the appearance of corruption are the only legitimate and 16 compelling government interests thus far identified for restricting campaign finances." Fed.

17 Election Comm'n v. Nat'l Conservative Political Action Comm., 470 U.S. 480, 496-497 (1985) 18 (emphasis added). 19 By contrast, limitations on corporate campaign expenditures are subject to "exacting

20 scrutiny," because they restrict speech that is "at the core of our electoral process and of the First 21 Amendment freedoms." See Buckley, 424 U.S. at 39, 44. See also McConnell, 540 U.S. at 134 22 (opinion of Stevens & O'Connor, JJ.). To justify a limitation on a corporation's independent 23 expenditure of funds in support of or against a political office candidate, initiative, or referendum, 24 the government must demonstrate that its pursuit of a compelling state interest is narrowly tailored 25 to protect that interest. See McConnell, 540 U.S. at 204-207; Fed. Election Comm'n v. Wisconsin 26 Right to Life, Inc. (WRTL), 127 S. Ct. 2652, 2664, 2671 (2007); see also McConnell, 540 U.S. at 27 204 (noting that BCRA does not impose a "complete ban" on corporate expression). As with 28 corporate contribution limitations, only the government's interest in preventing actual or apparent
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1 corruption in elections has been found to be compelling enough to justify corporate expenditure 2 limitations. Austin, 494 U.S. at 660. No other interest has ever been found adequate to justify 3 corporate campaign speech limitations. See Fed. Election Comm'n v. Nat'l Conservative Political 4 Action Comm., 470 U.S. at 496-97 ("[P]reventing corruption or the appearance of corruption are 5 the only legitimate and compelling government interests thus far identified for restricting campaign 6 finances."); Austin, 494 U.S. at 658 (same). 7 Finally, there are some kinds of corporate political speech that enjoy absolute protection.

8 Government may under no circumstances ban corporate-funded issue advocacy, or corporate 9 expenditures on referenda and initiatives. See WRTL, 127 S. Ct. at 2672; Bellotti, 435 U.S. at 79110 92. There is no "important" or "compelling" interest that will justify such a ban--not even the
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11 interest in preventing actual or apparent corruption.1 12 B. Because Measure T's Prohibitions Are Neither Narrowly Tailored To Achieve a Compelling Governmental Interest, Nor Closely Drawn To 13 Match a Sufficiently Important Interest, Measure T Is Unconstitutional 14 Regardless of the government interest it purports to advance, Measure T is palpably

15 unconstitutional because of the sweeping scope and severity of its prohibitions. Measure T 16 imposes an absolute ban on all direct and indirect contributions, as well as independent 17 expenditures, by non-local corporations, that are intended to promote or defeat the candidacy 18 of any person for local office, or to promote or defeat any local initiative, referendum,2 or recall 19 /// 20 /// 21 22 In WRTL, the principal issue was the BCRA's prohibition of corporate-funded ads aired within 30 days of a federal primary election or 60 days of a federal general election. See WRTL, 127 S. 23 Ct. at 2660. 24 25 26 27 28 In Richey v. Tyson, 120 F. Supp. 2d 1298 (S.D. Ala. 2000), decided prior to WRTL, the court reviewed the constitutionality of state reporting, recordation, and organization requirements for corporate political action committee (PAC) expenditures pertaining to referenda. The court, deeming the referenda-related expenditures the equivalent of express advocacy, see id. at 1310, upheld the state regulations under strict scrutiny review, see id. at 1310-26. Although the court's categorization of referenda-related expenditures as express advocacy is likely incorrect, given that the fear of corrupting quid pro quos is not present with referenda and initiative elections (as opposed to candidate elections), nevertheless Measure T goes far beyond the statute at issue in Richey in imposing a total ban on referenda- and initiative-related corporate expenditures.
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1 election. In other words, Measure T goes far beyond what is necessary to achieve a lawful 2 government interest, being neither narrowly tailored nor even closely drawn to advance such an 3 interest. 4 The County's purported justification for this total ban is the alleged corrupting influence

5 of corporate-funded campaign contributions and expenditures, in the creation of the appearance 6 (or the actual fact) of quid pro quos, cf. Buckley, 424 U.S. at 26-27, 45, or, alternatively, "the 7 corrosive and distorting effects of immense aggregations of wealth that are accumulated with the 8 help of the corporate form and that have little or no correlation to the public's support for the 9 corporation's political ideas," Austin, 494 U.S. at 659-60. Cf. First Am. Compl. Exh. 1, § 3, 10 subparas. 4-8. But, as discussed above, the Supreme Court has already determined that such
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11 interests cannot justify a limitation on corporate-funded issue advocacy, see WRTL, 127 S. Ct. at 12 2672, nor a ban on expenditures relating to referenda and initiatives, see Bellotti, 435 U.S. at 79113 92. And the same Court has never countenanced a total ban on all corporate contributions and 14 expenditures,3 as Measure T imposes. Measure T therefore infringes upon Plaintiffs' free speech 15 rights, even assuming that it advances a legitimate government interest. Given that Measure T 16 substantially impinges upon protected speech in the scope and severity of its prohibitions, a TRO 17 and preliminary injunction suspending its effect pending resolution of this case on the merits are 18 appropriate. See Virginia v. Hicks, 539 U.S. 113, 120 (2003). Cf. McConnell, 540 U.S. at 207. 19 20 21 22 23 24 25 The closest the Court has ever come is Austin, and even there the Court, in upholding a state ban 26 on independent corporate expenditures made in connection with state office elections, noted that the challenged law "does not impose an absolute ban on all forms of corporate political spending 27 but permits corporations to make independent political expenditures through separate segregated funds." Austin, 494 U.S. at 660. See id. at 669 (Brennan, J., concurring). In contrast, Measure T 28 does not offer any segregated fund option.
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1 C. Because Measure T's Prohibitions Do Not Even Serve a Compelling or Important Government Interest, Its 2 Corporate Political Speech Limitations Are Unconstitutional 3 As the Supreme Court has routinely observed, and as noted above, a limitation on corporate

4 electoral speech can be justified only if the limitation serves to prevent corruption or the 5 appearance of corruption. See Austin, 494 U.S. at 658; Nat'l Conservative Political Action Comm., 6 470 U.S. at 496-97. Specifically, the limitation must be aimed to eliminate (1) financial quid pro 7 quos, or (2) the supposed corrosive effects of large corporate wealth expended in elections.4 8 See Austin, 494 U.S. at 659-60. While the County undoubtedly will claim that Measure T 9 advances these interests, Measure T itself reveals that it does not. 10
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Measure T's findings and exemptions reveals, not a concern for corruption-free elections,

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11 but irrational animus against non-local corporations as such and the political views they may 12 express. The measure's findings include baseless accusations about non-local corporations, while 13 failing to explain why local corporations or incorporated unions are exempt from those same 14 accusations. Measure T proclaims that "[c]orporate contributions in electoral politics interfere 15 with the right of the people to create and maintain the institutions needed for democratic self16 governance," First Am. Compl. Exh. 1, § 3 subpara. 4, "are imminently undermining [Humboldt 17 County's] democratic processes," id. § 3 subpara. 7, and "pose a genuine threat to the confidence 18 of the citizenry of Humboldt County in our government," id. § 3 subpara. 6. Measure T also says 19 that "non-local corporate contributions are . . . creating the appearance of impropriety and 20 corruption, and are causing the people of Humboldt County to lose confidence in the integrity of 21 our elections and in our government." Id. § 3 subpara.7. But Measure T explicitly exempts non22 local incorporated labor entities from its prohibitions--even though they enjoy the same 23 organizational structure as non-labor corporations and have been involved in many highly 24 publicized corruption scandals. If corruption really were Measure T's concern, why would it 25 exclude such a significant source of corruption? 26 This latter justification has recently been called into question by some members of the High 27 Court. See WRTL, 127 S. Ct. at 2679 (Scalia, J., concurring in part and concurring in the judgment) (joined by Kennedy and Thomas, JJ.) ("Austin was a significant departure from ancient 28 First Amendment principles. In my view, it was wrongly decided.").
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1

As is clear from Measure T's findings and exemptions, the real "interest" being served is

2 either (1) the silencing of so-called "nonlocal" voices in local elections,5 or (2) the muzzling of 3 speech from certain types of corporations.6 But the Supreme Court has never found that a 4 locality's interest in silencing "outsiders" trumps the constitutional rights of those outsiders. Cf. 5 McIntyre v. Ohio Elections Comm'n, 514 U.S. 334, 357 (1995) (observing "the purpose behind the 6 Bill of Rights, and of the First Amendment in particular: to protect unpopular individuals from 7 retaliation--and their ideas from suppression--at the hand of an intolerant society"). Indeed, the 8 entire civil rights movement speaks heavily against Measure T's offensive parochialism. Cf. Gary 9 Peller, Cultural Imperialism, White Anxiety, and the Ideological Realignment of Brown, in Race, 10 Law & Culture 190, 198 (Austin Surat ed. 1997) (noting southern parochialism to be an obstacle
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11 to Brown and desegregation). 12 Further, and as explained in greater detail in the proceeding section, that Measure T

13 provides exemptions to incorporated labor organizations, and makes it much easier for labor 14 organizations to qualify as "local," underscores that Measure T's purpose is simply to stifle certain 15 viewpoints associated with corporations. The First Amendment does not allow such a blatant form 16 of viewpoint discrimination.. See Bellotti, 435 U.S. at 784-86 ("In the realm of protected speech, 17 the legislature is constitutionally disqualified from dictating the subjects about which persons may 18 speak and the speakers who may address a public issue. . . . [W]here . . . the legislature's 19 suppression of speech suggests an attempt to give one side of a debatable public question an 20 advantage in expressing its views to the people, the First Amendment is plainly offended.") 21 (footnote omitted); see id. at 802 (Berger, C.J., concurring) ("[T]he First Amendment does not 22 `belong' to any definable category of persons or entities: It belongs to all who exercise its 23 freedoms."). 24 25 See First Am. Compl. Exh. 1, § 3 subpara. 2 (corporations possess no rights); § 3 subpara. 3 (courts have illegitimately invested corporations with constitutional rights); § 3 subparas. 7-8 26 (nonlocal corporations undermining local elections, creating appearance of impropriety, and injecting "outside influence" that is "unfair and undemocratic"). 27 6 See First Am. Compl. Exh. 1, §§ 10-11 (providing exemption to local labor organization, whether 28 or not incorporated).
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1

Additionally, neither of Plaintiffs' real interests has anything at all to do with corruption

2 in local campaigns. As to the first interest, barring nonlocal voices from local elections only serves 3 to narrow the public debate; it has no relation whatsoever to corruption through quid pro quos or 4 purported excessive influence. As to the second interest, preventing almost all non-labor-oriented 5 corporations from speaking, but allowing almost all labor-oriented corporations to speak freely, 6 cannot directly remediate any corruption, for the obvious reason that the orientation of a given 7 corporation has little if anything to do with its susceptibility to corruptive practices, or with the size 8 of its election war chest. Thus, the real interests motivating Measure T cannot justify its speech 9 limitations, because those interests fall far short of what the Supreme Court has required; and for 10 that reason as well, Measure T is unconstitutional.
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11 D. Because Measure T's Classifications Burdening Free Speech Rights Are Not Narrowly Tailored To Achieve 12 a Compelling State Interest, They Are Unconstitutional 13 The Equal Protection Clause of the Fourteenth Amendment provides that no state (and by

14 necessary implication no subdivision of a state) shall deny to any person within its jurisdiction the 15 equal protection of the laws. See U.S. Const. amend. XIV, § 1. A law violates the Equal 16 Protection Clause if it unconstitutionally uses classifications to treat similarly situated individuals 17 or groups differently. See Reynolds v. Sims, 377 U.S. 533, 565 (1964) ("[T]he concept of equal 18 protection has been traditionally viewed as requiring the uniform treatment of persons standing in 19 the same relation to the governmental action questioned or challenged."). When a fundamental 20 right--like the right to free speech--is at issue, the classification triggers strict scrutiny: The law 21 will be found to violate the Equal Protection Clause if the law is not narrowly tailored to serve a 22 compelling interest. Austin, 494 U.S. at 666. As the Supreme Court explained: 23 24 25 26 Village of Willowbrook v. Olech, 528 U.S. 562, 564 (2000) (per curiam) (quoting Sioux City Bridge 27 Co. v. Dakota County, 260 U.S. 441, 445 (1923)). Cf. Romer v. Evans, 517 U.S. 620, 633 (1996) 28 ("A law declaring that in general it shall be more difficult for one group of citizens than for all
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"`The purpose of the equal protection clause of the Fourteenth Amendment is to secure every person within the State's jurisdiction against intentional and arbitrary discrimination, whether occasioned by express terms of a statute or by its improper execution through duly constituted agents.'"

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1 others to seek aid from the government is itself a denial of equal protection of the laws in the most 2 literal sense."). 3 Measure T, through its definitions of "local corporation" and "local labor organization,"

4 imposes its prohibitions disproportionately on corporate enterprises as opposed to incorporated 5 labor organizations. The ordinance hinges "labor organization" status on the National Labor 6 Relation Act's definition, see First Am. Compl. Exh. 1, § 11, which includes both incorporated and 7 unincorporated organizations. See 29 U.S.C. § 152(5). Assuming arguendo that an important or 8 compelling government interest justifies campaign contribution and expenditure limitations on 9 corporations, there is no legitimate basis for concluding that the alleged corrupting effects of 10 corporate campaign speech are any greater than campaign speech from incorporated labor
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11 organizations.7 Measure T's classification not only lacks the support of a compelling government 12 interest, it is also totally arbitrary and irrational. By including the vast majority of non-labor13 oriented corporations within its ambit, but at the same time exempting nearly all labor-oriented 14 corporations, Measure T functions like an ill-guided blunderbuss. It is not narrowly tailored to 15 achieve any compelling interest in corruption-free elections. 16 Measure T, through its definitions of "local corporation" and "local labor organization,"

17 also imposes its prohibitions disproportionately on corporate enterprises as opposed to labor 18 organizations by its conception of a "local" entity. To qualify as "local," a corporation must 19 establish that (1) all employees reside in Humboldt County, (2) the corporation's principal place 20 of business and headquarters are located in Humboldt County, (3) all shareholders reside in 21 Humboldt County, and (4) no shareholder is a corporation. See First Am. Compl. Exh. 1, § 11. 22 In contrast, a labor organization, to qualify as "local," need only establish that (1) it qualifies as 23 a labor organization under the National Labor Relations Act, and (2) at least one member resides 24 in Humboldt County. See id. 25 /// 26 Cf. Austin, in which the Court rejected an equal protection challenge to an exemption for 27 unincorporated labor unions from a state law ban on direct corporate expenditures. See Austin, 494 U.S. at 665-66. As noted in the text, Measure T makes no such distinction, affording an exemption 28 to "local labor organizations" whether or not incorporated.
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1

Assuming arguendo that a compelling interest exists to impose campaign contribution and

2 expenditure limitations on "non-local" corporations, there is no legitimate basis for making the 3 standard for "local" much more difficult to achieve for corporations as opposed to labor 4 organizations. Therefore, in its disparate treatment of corporations as opposed to incorporated 5 labor organizations, Measure T's prohibitions and exemptions are not narrowly tailored to achieve 6 a compelling interest (and thus necessarily are not reasonably related to a legitimate end), in 7 violation of the Equal Protection Clause. Moreover, Measure T fails to treat similarly situated 8 groups in a like manner, in violation of the Equal Protection Clause. Therefore, Measure T cannot 9 be applied constitutionally. Cf. Heckler v. Mathews, 465 U.S. 728, 738 (1984) (appropriate remedy 10 for Equal Protection Clause violation is expansion of exemption to all members of improperly
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11 targeted class). 12 13 14 15 Measure T amounts to a flagrant flouting of free speech and other constitutional rights III THE PUBLIC INTEREST FAVORS PRELIMINARY EQUITABLE RELIEF

16 enjoyed by corporate persons, a point as much as admitted in the Measure's preamble. See First 17 Am. Compl. Exh. 1, § 3 subparas. 2-3. Therefore, an injunction here forbidding Defendant to 18 enforce Measure T would vindicate the constitutional rights of Plaintiffs and other "non-local 19 corporations," and would thus very much further the public interest. See, e.g., Phelps-Roper v. 20 Nixon, 509 F.3d 480, 485 (8th Cir. 2007) (observing that it "is always in the public interest to 21 protect constitutional rights"); Chabad of Southern Ohio & Congregation Lubavitch v. City of 22 Cincinnati, 363 F.3d 427, 436 (6th Cir. 2004) (holding that "the public interest is served by 23 preventing the violation of constitutional rights"). Cf. One World One Family Now, Inc. v. 24 Nevada, 860 F. Supp. 1457, 1464 (D. Nev. 1994) ("`[T]he public's interest in safeguarding the 25 fundamental rights of the First Amendment outweighs any competing public interest in the 26 maintenance of the public walkways.'") (quoting One World One Family Now, Inc. v. City of Key 27 West, 852 F. Supp. 1005, 1013 (S.D. Fla. 1994)). 28 ///
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1 2 3 4 5 6 7 8 9 10
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As the Ninth Circuit has observed: The public interest inquiry primarily addresses impact on non-parties rather than parties. . . . Courts considering requests for preliminary injunctions have consistently recognized the significant public interest in upholding First Amendment principles. See Homans v. Albuquerque, 264 F.3d 1240, 1244 (10th Cir. 2001) ("[W]e believe that the public interest is better served by following binding Supreme Court precedent and protecting the core First Amendment right of political expression."); Iowa Right to Life Comm'e, Inc. v. Williams, 187 F.3d 963, 970 (8th Cir. 1999) (finding a district court did not abuse its discretion in granting a preliminary injunction because "the potential harm to independent expression and certainty in public discussion of issues is great and the public interest favors protecting core First Amendment freedoms"); Suster v. Marshall, 149 F.3d 523, 530 (6th Cir. 1998) (holding candidates for judicial office were entitled to preliminary injunction of expenditure limit given likelihood of success on the merits, irreparable harm and lack of public interest in enforcing a law that curtailed political speech); Elam Constr., Inc. v. Regional Transp. Dist., 129 F.3d 1343, 1347 (10th Cir. 1997) (stating, in context of a request for injunctive relief, that "[t]he public interest . . . favors plaintiffs' assertion of their First Amendment rights"); G & V Lounge, Inc. v. Mich. Liquor Control Com'n, 23 F.3d 1071, 1079 (6th Cir. 1994) (noting "it is always in the public interest to prevent the violation of a party's constitutional rights"); Cate v. Oldham, 707 F.2d 1176, 1190 (11th Cir. 1983) (holding the "strong public interest in protecting First Amendment values" favored preliminary injunctive relief).

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11 12 13

14 See Sammartano v. First Judicial District Court, 303 F.3d 959, 974 (9th Cir. 2002). Cf. Monterey 15 County Democratic Cent. Comm. v. United States Postal Serv., 812 F.2d 1194, 1196 (9th Cir. 16 1987) ("The values embodied in the First Amendment . . . constitut[e] the hallmark of free 17 societies."), quoted in Napa Valley Publishing Co., 225 F. Supp. 2d at 1198. As is clear from the 18 foregoing, preliminary equitable relief would directly benefit the public by ensuring free and open 19 speech during a local election season; an injunction would harm no one. The public interest 20 therefore favors such relief. 21 22 23 24 FRCP 65(c) requires that, prior to the issuance of an injunction, the movant post bond "in IV THE BOND REQUIREMENT SHOULD BE WAIVED, OR BOND SHOULD BE SET AT A NOMINAL AMOUNT

25 an amount that the court considers proper." FRCP 65(c). The Ninth Circuit has consistently 26 interpreted Rule 65(c) to allow district courts to impose either a nominal bond, or no bond at all. 27 See Save Our Sonoran, Inc. v. Flowers, 408 F.3d 1113, 1126 (9th Cir. 2005). Waiver of a bond 28 is justified when an injunction is unlikely to result in harm to the party enjoined, the exercise of
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1 constitutional rights is at issue or when a suit is brought in the public interest. See Westfield High 2 School L.I.F.E. Club v. City of Westfield, 249 F. Supp. 2d 98, 128-29 (D. Mass. 2003); Smith v. 3 Board of Elec. Comm'rs for City of Chicago, 591 F. Supp. 70, 72 (N.D. Ill. 1984) Barahona4 Gomez v. Reno, 167 F.3d 1228, 1237 (9th Cir. 1999); California ex rel. Van De Kamp v. Tahoe 5 Regional Planning Agency, 766 F.2d 1319, 1325-26 (9th Cir. 1985). 6 As explained above, preliminary relief is unlikely to cause any harm to the County. There

7 is no evidence that Plaintiffs' exercise of their speech rights has ever caused injury to the County 8 or its citizens in the past; and there is no reason to believe that their speech would result in injury 9 to the County this election season. Even if the County could show "harm," it would be impossible 10 to quantify it for purposes of a bond posting. Bartels v. Biernat, 405 F. Supp. 1012, 1019 (E.D.
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11 Wis. 1975) (justifying bond waiver in part on grounds that "the amount of any order for bond or 12 security would be based on gross speculation or conjecture"). Moreover, this case involves the 13 fundamental constitutional rights to free speech and equal protection, and is brought in the public 14 interest. To require a bond in this case "would have the effect of discouraging suits to remedy 15 more flagrant abuses" of individual rights by government. Id. Plaintiffs therefore respectfully 16 request that FRCP 65(c)'s bond requirement be either waived or set at a nominal amount. 17 18 19 20 21 22 23 By 24 25 26 27 28
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CONCLUSION For these reasons, Plaintiffs request that the Court issue a TRO and preliminary injunction. DATED: September 3, 2008. Respectfully submitted, PAUL J. BEARD II DAMIEN M. SCHIFF BRANDON M. MIDDLETON /s/ Damien M. Schiff DAMIEN M. SCHIFF

Attorneys for Plaintiffs

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1 2 3 4 5 6

DECLARATION OF SERVICE BY FACSIMILE AND MAIL I, Damien M. Schiff, declare as follows: I am a resident of the State of California, residing or employed in Sacramento, California. I am over the age of 18 years and am not a party to the above-entitled action. My business address is 3900 Lennane Drive, Suite 200, Sacramento, California 95834. On September 3, 2008, true copies of MEMORANDUM OF POINTS AND

7 AUTHORITIES IN SUPPORT OF PLAINTIFFS' APPLICATION FOR TEMPORARY 8 RESTRAINING ORDER AND ORDER TO SHOW CAUSE RE: PRELIMINARY INJUNCTION 9 were faxed and placed in envelopes addressed to: 10
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11 12 13 14 15 16

Board of Supervisors County of Humboldt Attn: Kathy Hayes, Clerk of the Board 825 - 5th Street, Room 111 Eureka, CA 95501 Fax: (707) 445-7299 Ms. Wendy B. Chaitin Interim County Counsel County of Humboldt 825 - 5th Street Eureka, CA 95501 Fax: (707) 445-6297

17 which envelopes, with postage thereon fully prepaid, were then sealed and deposited in a mailbox 18 regularly maintained by the United States Postal Service in Sacramento, California. 19 I declare under penalty of perjury that the foregoing is true and correct and that this

20 declaration was executed this 3rd day of September, 2008, at Sacramento, California. 21 22 23 24 25 26 27 28
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/s/ Damien M. Schiff DAMIEN M. SCHIFF

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1 PAUL J. BEARD II, No. 210563 E-mail: [email protected] 2 DAMIEN M. SCHIFF, No. 235101 E-mail: [email protected] 3 BRANDON M. MIDDLETON, No. 255699 E-mail: [email protected] 4 Pacific Legal Foundation 3900 Lennane Drive, Suite 200 5 Sacramento, California 95834 Telephone: (916) 419-7111 6 Facsimile: (916) 419-7747 7 Attorneys for Plaintiffs 8 9 10
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IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF CALIFORNIA

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11 12 MERCER, FRASER CO., a California corporation; and ) No. CV 08-4098 SI O & M INDUSTRIES, a California corporation, ) 13 ) FIRST AMENDED Plaintiffs, ) COMPLAINT FOR 14 ) DECLARATORY AND v. ) INJUNCTIVE RELIEF 15 ) COUNTY OF HUMBOLDT, CALIFORNIA, a ) Judge: Hon. Susan Illston 16 political subdivision of the State of California ) Courtroom 10, 19th Floor ) 17 Defendant. ) ) 18 19 20 1. INTRODUCTION Plaintiffs Mercer, Fraser Co., and O & M Industries, challenge the constitutionality

21 of the "Humboldt County Ordinance to Protect Our Right to Fair Elections and Local Democracy," 22 known as "Measure T," a true and correct copy of which is attached hereto as Exhibit 1, and 23 incorporated by reference. Measure T forbids all election-related contributions and expenditures 24 by nonlocal corporations. Plaintiffs contend that Measure T violates Plaintiffs' political free 25 speech rights under the First Amendment of the Federal Constitution, as incorporated against 26 municipalities by the Due Process Clause of the Fourteenth Amendment, as well as Plaintiffs' right 27 to be free from arbitrary and irrational discrimination that impacts the exercise of said speech 28 rights, as protected by the Equal Protection Clause of the Fourteenth Amendment. Plaintiffs seek
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1 a declaratory judgment that Measure T is unconstitutional and void, as well as preliminary and 2 permanent prohibitory injunctions forbidding its enforcement. 3 4 2. JURISDICTION This Court has subject matter jurisdiction of the action pursuant to 28 U.S.C. § 1331

5 (federal question); § 1343(a)(3) (constitutional violation under color of state law); § 2201 6 (authorizing declaratory relief); and § 2202 (authorizing injunctive relief). Plaintiffs' claims for 7 relief arise under the First and Fourteenth Amendments, and Plaintiffs seek redress pursuant to 42 8 U.S.C. § 1983 for deprivations, under color of municipal law, for deprivations of their rights 9 secured under the same Amendments. 10
3900 Lennane Drive, Suite 200 Sacramento, CA 95834 (916) 419-7111 FAX (916) 419-7747

VENUE 3. Venue in this judicial district is proper under 28 U.S.C. § 1391(b)(2), because a

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12 substantial part of the events or omissions giving rise to the claims occurred in this district. 13 14 4. INTRADISTRICT ASSIGNMENT Pursuant to Civil Local Rule 3-2(c), this action arises in the County of Humboldt

15 because a substantial part of the events or omissions giving rise to the claims occurred in that 16 County. Pursuant to Civil Local Rule 3-2(d), this action should be assigned to either the 17 San Francisco or Oakland Division. 18 19 5. NATURE OF THIS ACTION This action is authorized by Section 1 of the Civil Rights Act of 1871, 17 Stat. 13,

20 as amended, see 42 U.S.C. § 1983, to prevent the deprivation, under color of state law, of rights 21 secured by the First and Fourteenth Amendments to the United States Constitution. Section 1983 22 provides, in relevant part, that 23 24 25 26 27 /// 28 ///
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[e]very person who, under color of any statute, ordinance, regulation, custom, or usage, of any State or Territory or the District of Columbia, subjects, or causes to be subjected, any citizen of the United States or other person within the jurisdiction thereof to the deprivation of any rights, privileges, or immunities secured by the Constitution and laws, shall be liable to the party injured in an action at law, suit in equity, or other proper proceeding for redress . . . .

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1 2 The Plaintiffs 3 6.

PARTIES

Plaintiff Mercer, Fraser Co., is a corporation organized under the laws of the State

4 of California. Plaintiff's current corporate charter was issued by the California Secretary of State 5 in 1948. Plaintiff is a successful asphalt paving, highway and heavy construction business located 6 in Eureka, California. Approximately 98% of Plaintiff's employees live in Humboldt County. A 7 corporation may maintain an action under Section 1983. 8 7. Plaintiff Mercer, Fraser is considered a nonlocal corporation under Measure T and

9 is therefore subject to Measure T's total prohibition on "nonlocal corporation" political 10 expenditures and contributions.
3900 Lennane Drive, Suite 200 Sacramento, CA 95834 (916) 419-7111 FAX (916) 419-7747

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8.

Prior to Measure T's passage, Plaintiff Mercer, Fraser contributed to local election

12 campaigns, and also purchased its own advertisements in local newspapers to support local 13 candidacies. But for Measure T's prohibitions, Plaintiff would, directly and indirectly, expend and 14 contribute money and other things of value in local elections within Humboldt County. 15 9. Since November, 2007, Plaintiff Mercer, Fraser has neither expended nor

16 contributed money or other things of value in an election in Humboldt County, and will not do so, 17 for fear of prosecution for violation of Measure T's prohibitions. 18 10. Therefore, Measure T, since its passage and continuously since then and to the

19 present, has worked upon Plaintiff Mercer, Fraser concrete and discrete injuries to its rights under 20 the First and Fourteenth Amendments. 21 11. Plaintiff Mercer, Fraser would receive redress for its injuries by a favorable decision

22 from this Court. A declaration that Measure T is unconstitutional and a permanent injunction 23 enjoining its enforcement would permit Plaintiff to expend and contribute money and other things 24 of value in local elections within Humboldt County. 25 12. Plaintiff O & M Industries is a corporation organized under the laws of the State

26 of California. Plaintiff's current corporate charter was issued by the California Secretary of State 27 in 1972. Plaintiff is a successful manufacturer focusing on steel fabrication and heat, ventilation, 28 and air conditioning systems. (The company built the famed steel Coke bottle located in the left
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1 field seats at the San Francisco Giants' ATT Park.) A corporation may maintain an action under 2 Section 1983. 3 13. Approximately three quarters of Plaintiff O & M Industries's employees live within

4 the Humboldt County, but Plaintiff is considered a nonlocal corporation under Measure T because 5 the remainder of its workforce resides outside the County. Therefore, Plaintiff is subject to 6 Measure T's total prohibition on "nonlocal corporation" political expenditures and contributions. 7 14. Prior to Measure T's passage, Plaintiff O & M Industries contributed to a local

8 election campaign. But for Measure T's prohibitions, Plaintiff would, directly and indirectly, 9 expend and contribute money and other things of value in local elections within Humboldt County. 10
3900 Lennane Drive, Suite 200 Sacramento, CA 95834 (916) 419-7111 FAX (916) 419-7747

15.

Since Measure T's passage, Plaintiff O & M Industries has not and will not expend

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11 and contribute money and other things of value, for fear of prosecution for violation of 12 Measure T's prohibitions. 13 16. Therefore, Measure T, since its passage and continuously since then and to the

14 present, has worked upon Plaintiff O & M Industries concrete and discrete injuries to its rights 15 under the First and Fourteenth Amendments. 16 17. Plaintiff O & M Industries would receive redress for its injuries by a favorable

17 decision from this Court. A declaration that Measure T is unconstitutional and a permanent 18 injunction enjoining its enforcement would permit Plaintiff to expend and contribute money and 19 other things of value in local elections within Humboldt County. 20 The Defendant 21 18. Defendant County of Humboldt is a political subdivision of the State of California.

22 A county is a "person" within the meaning of 42 U.S.C. § 1983. Defendant is principally 23 responsible for the implementation and enforcement of Me