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ACLU OF NEW JERSEY v. NEW JERSEY ELECTION LAW ENFO

March 16, 1981

AMERICAN CIVIL LIBERTIES UNION OF NEW JERSEY, etc. et al., Plaintiffs,
v.
NEW JERSEY ELECTION LAW ENFORCEMENT COMMISSION, etc. et al., Defendants, and John J. Degnan, Attorney General of New Jersey, Defendant-Intervenor



The opinion of the court was delivered by: STERN

 This action presents a constitutional challenge to certain provisions of The New Jersey Campaign Contributions and Expenditures Reporting Act *fn1" which regulate activities by groups which seek to influence the legislative process. The Act imposes extensive reporting and disclosure requirements on all "political information organizations," defined to include any group "which seeks to influence the content, introduction, passage or defeat of legislation." *fn2" In general, the Act requires each political information organization to report in some instances annually, in others eight times a year its contributions and expenditures of over $ 100, and specifically prohibits the organization from receiving anonymous contributions. The Act also requires each political information organization to follow certain internal administrative procedures with respect to the receipt and expenditure of funds. Compliance with the Act is regulated and enforced by a bipartisan group, the Election Law Enforcement Commission, created by the statute.

 The American Civil Liberties Union and its New Jersey affiliate brought this action on February 6, 1974. The complaint sought a declaratory judgment that the challenged provisions of the Act were unconstitutional and an injunction against enforcement of those provisions against plaintiffs and their members. *fn3" A three-judge court was convened, *fn4" and on March 13, 1974, this Court heard plaintiffs' motion for preliminary relief. At that hearing we were informed that a contemporaneous state court action involved a similar challenge to the constitutionality of the Act. *fn5" Because the state court had enjoined enforcement of the Act at that time, we found that plaintiffs were suffering no irreparable injury and denied the application for temporary relief. Upon the consent of all parties, this case was subsequently placed on the Court's inactive list pending the outcome of the state court litigation.

 The state court action proceeded up New Jersey's judicial ladder. On February 6, 1980, the New Jersey Supreme Court filed its opinion upholding the constitutionality of the Act. New Jersey State Chamber of Commerce v. New Jersey Election Law Enforcement Commission, 82 N.J. 57, 411 A.2d 168 (1980) (hereinafter "Chamber of Commerce "). *fn6" In so holding, the Supreme Court narrowed the definition of "political information organization" to include only "persons whose direct, express, and intentional communications with legislators for the purpose of affecting the outcome of legislation are undertaken on a substantial basis." 82 N.J. at 80, 411 A.2d at 179. The Court also considered a $ 100 threshold exemption which the Commission had promulgated as an exception to the disclosure provisions of the Act, N.J.Admin.Code § 19:25-12.1(e); the Court held that the Commission had the power to prescribe such an exemption but that the $ 100 threshold was too low to satisfy the purposes of the Act. It therefore invalidated the regulation containing the $ 100 exemption and ordered the Commission to promulgate a regulation with a higher threshold. *fn7"

 Following the state Supreme Court's decision, plaintiffs reactivated this case. Throughout this litigation their challenge to the Act has been founded on two concerns. First, plaintiffs contend that the broad administrative and reporting requirements will inhibit speech by groups, like themselves, which are not lavishly funded nor substantially devoted to lobbying. Second, they argue that the mere fact of disclosure of the names of contributors will impede the associational interests of them and their members.

 Specifically, plaintiffs contend: (1) that the statutory definition of "political information organization" is unconstitutionally vague; (2) that the compelled reporting and disclosure of contributions and expenditures unrelated to lobbying is facially overbroad and, as applied, violative of their freedom of association; (3) that the compelled reporting and disclosure of contributions and expenditures relating to the dissemination of neutral political information is facially overbroad and, as applied, violative of their freedom of association; (4) that the Act is overbroad insofar as it requires reporting of legislative advocacy by employees of an affected organization; (5) that the detailed administrative requirements are facially overbroad; and (6) that the prohibition of anonymous contributions violates their freedom of association.

 A hearing on cross-motions for summary judgment was scheduled for June 3, 1980. Prior to the hearing date, the Commission proposed extensive regulations which, if promulgated, would have affected plaintiffs' obligations under the statute. In particular, the proposed regulations would have affected plaintiffs' second and fifth contentions: Rather than reporting all contributions and expenditures exceeding $ 100, political information organizations would only have to report contributions if the pro rata share, considering the percentage of lobbying done by the organization and applying that percentage to the amount of the contribution, exceeded $ 100. For example, if the ACLU spent 5% of its funds on lobbying, only general contributions of more than $ 2,000 would be reported, because only then would the average amount spent on lobbying equal or exceed $ 100. In addition, expenditures would only have had to be reported if they related to lobbying activity. With respect to the fifth contention, the regulations contained a provision limiting the prohibition of anonymous contributions to those earmarked for lobbying or to an organization whose primary purpose was lobbying. The proposed regulations would not have modified the definitions of "political information" or "political information organization" contained in the statute (except, as ordered by the New Jersey Supreme Court, to set an enforcement threshold) or the detailed administrative requirements.

 At the urging of the parties, the Court postponed decision on the merits of the case until the regulations were promulgated and the parties had had an opportunity to evaluate the effect of the regulations on this suit. The proposed regulations were promulgated, with modifications, on August 6, 1980. The only significant change, for purposes of this action, was the Commission's deletion of the pro rata formula for determining when contributions must be reported; the regulations provide more simply that organizations which are not primarily engaged in lobbying must report only those contributions and expenditures, exceeding $ 100, related directly to lobbying activities. Plaintiffs renewed their motion for summary judgment, and oral argument was held on October 23, 1980. *fn8"

 I. VAGUENESS

 Plaintiffs first contend that section 3(g) of the Act, which defines "political information organization" to include any group "which seeks to influence the content, introduction, passage or defeat of legislation," *fn9" is unconstitutionally vague. *fn10"

 In the Chamber of Commerce case the plaintiffs contended that this same language was overbroad; that is, that it proscribed constitutionally protected as well as unprotected speech or conduct. The New Jersey Supreme Court recognized that "(t)he Act would be overreaching if its terms were to be enforced literally and inflexibly," 82 N.J. at 74, 411 A.2d at 176, and so performed, in its phrase, "judicial surgery." In order to narrow the reach of the phrase "to influence ... legislation" so that groups which are only peripherally involved in legislative activities would not be subject to the Act, the Court created a "verbal threshold" for application of the Act; it concluded that section 3(g) includes only "activity which consists of direct, express, and intentional communications with legislators undertaken on a substantial basis by individuals acting jointly for the specific purpose of seeking to affect the introduction, passage, or defeat of, or to affect the content of legislative proposals." Chamber of Commerce, supra, 82 N.J. at 79, 411 A.2d at 179. In language which clarifies in part the phrase "substantial basis," the Court stated that the statute "would come into operation only with respect to the receipt and expenditure of significant sums of money used in connection with such communications." 82 N.J. at 80, 411 A.2d at 179. The Court further ordered the Commission to establish by regulation a monetary threshold "for the purpose of regulating the flow of "significant money' in the area of legislative influence," 82 N.J. at 84, 411 A.2d at 181. The Commission subsequently set the threshold or exemption at $ 2,500. *fn11" N.J.Admin.Code, § 19:25-8.5.

 Unlike the plaintiffs in Chamber of Commerce, plaintiffs here challenge section 3(g) as unconstitutionally vague. The void for vagueness doctrine rests essentially on due process considerations the notion that a statute should provide a reasonable person fair notice of what conduct it proscribes. *fn12" The doctrine serves to invalidate a statute even if the conduct which may be within its reach could constitutionally be regulated by the state. Its most important application, however, is to statutes which arguably prohibit constitutionally protected conduct. Thus, it has been used frequently to void statutes which may effect a prior restraint on the exercise of free speech. Smith v. Goguen, 415 U.S. 566, 573, 94 S. Ct. 1242, 1247, 39 L. Ed. 2d 605 (1974); NAACP v. Button, 371 U.S. 415, 433, 83 S. Ct. 328, 338, 9 L. Ed. 2d 405 (1963); Cramp v. Board of Public Instruction, 368 U.S. 278, 82 S. Ct. 275, 7 L. Ed. 2d 285 (1961). In this context the vagueness and overbreadth doctrines overlap: in each case the statutory infirmity is that conduct which may not be proscribed consistent with the Constitution is or may be inhibited by the statute.

 Applying the strict scrutiny appropriate to cases involving First Amendment freedoms, we cannot find that the definition of "political information organization" is unconstitutionally vague. Any constitutional problems engendered by the bare statutory language have been remedied by the "judicial surgery" performed by the New Jersey Supreme Court and by the precise monetary threshold established by regulation. *fn13"

 Thus, we reject plaintiffs' contention that the definition of a "political information organization" is unconstitutionally vague.

 II. REPORTING AND ADMINISTRATIVE REQUIREMENTS

 A. Overview

 Plaintiffs contend that the statutory scheme of administrative, reporting and disclosure requirements violates their First Amendment rights to freedom of speech, petition for the redress of grievances, and freedom of association, *fn14" and is unconstitutionally overbroad. Specifically, they contend that:

 (1) the reporting and administrative requirements of sections 8 and 16 of the Act infringe on plaintiffs' freedom of speech and are unconstitutionally overbroad, in that they impose burdensome ...


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