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Missouri Chamber of Commerce and Industry v. Missouri Ethics Commission

Court of Appeals of Missouri, Western District, Fourth Division

April 9, 2019

MISSOURI CHAMBER OF COMMERCE AND INDUSTRY, Appellant,
v.
MISSOURI ETHICS COMMISSION, et al., Respondents.

          Appeal from the Circuit Court of Cole County, Missouri The Honorable Patricia S. Joyce, Judge

          Before: Karen King Mitchell, Chief Judge, and Alok Ahuja and Thomas N. Chapman, Judges

          Karen King Mitchell, Chief Judge

         The Missouri Chamber of Commerce and Industry (the Chamber) appeals the denial of its request for a declaratory judgment to the effect that the Missouri Campaign Contribution Reform Initiative of 2016 (Amendment 2) allows contributions from a corporation's treasury to a political action committee (PAC) established, administered, or maintained by the corporation. In its sole point on appeal, the Chamber argues that the trial court erred in concluding that Amendment 2 prohibits contributions from a corporation to such a PAC. Because we conclude that the plain and ordinary meaning of the language of Amendment 2, read in its entirety, prohibits contributions from a corporation to a PAC established, administered, or maintained by the corporation, we affirm.

         Background

         On November 8, 2016, Missouri voters passed Amendment 2, which became effective at the end of the 30th day after the election. Amendment 2 added a new section to the Missouri Constitution, titled the "Missouri Campaign Contribution Reform Initiative." Mo. Const. art. VIII, § 23. Amendment 2 imposes restrictions on the types of campaign contributions that corporations like the Chamber may make. The Chamber is a not-for-profit corporation organized pursuant to 26 U.S.C. § 501(c)(3) of the Internal Revenue Code and is registered as a nonprofit corporation with the Missouri Secretary of State. The Chamber established, administered, and maintained a PAC called the "We Mean Business PAC."

         Following passage of Amendment 2, the Missouri Ethics Commission (MEC), which investigates and enforces the laws governing campaign finance disclosure, issued two advisory opinions. In Advisory Opinion No. 2017.03.CF.010, dated March 27, 2017, MEC concluded that "because [§ 23.3(3)(a)] expressly authorizes specific types of individual contributions but does not specifically authorize the contributions from the entity's treasury or funds, a corporation . . . may not contribute its own funds to its connected[1] political action/continuing committee." In Advisory OpinionNo. 2017.07.CF.014, dated July 14, 2017, MEC reaffirmed its earlier conclusion about connected PACs. There, MEC stated, "The Commission discussed the application of [§§ 23.3(3)(a) and 23.3(12)] as they relate to corporate . . . contributions to PACs in MEC No. 2017.03.CF.010. The Commission stated that a corporation . . . may not contribute its own funds to its connected PAC, but that it may contribute direct corporate . . . funds to an 'unconnected' PAC."

         The Chamber filed a petition for declaratory judgment challenging MEC's conclusion that Amendment 2 prohibits contributions from a corporation to its connected PAC. The case was tried and submitted on stipulated facts. The trial court entered judgment in favor of MEC, concluding that Amendment 2

make[s] clear that while a corporation may not make direct contributions to committees tied to candidates or political parties, it may create, support and control its own PAC that may, in turn, make such contributions, provided the PAC is not funded with the corporation's own money. The connected PAC, in turn, may make various election-related expenditures-such as contributing to candidate committees-that a corporate connected organization may not. If a corporation wishes to "maintain" or "administer" a connected PAC, it may not contribute its own funds to that PAC, but it may solicit contributions to the PAC from its own directors, officers, employees, members, and shareholders.
By permitting connected PACs to receive contributions from corporate directors, officers, employees, members and shareholders but not the corporation itself, Amendment[2] prevents corporations from circumventing the prohibition on corporate contributions to candidates and political parties. Without that important limitation, corporations could evade [Amendment 2's] prohibitions by simply creating a connected PAC, contributing corporate funds to that PAC, and then directing the PAC to contribute to candidates or political parties of the corporation's choice.

The Chamber appeals.

         Standard of Review

         This case was submitted on stipulated facts and, thus, "did not involve the trial court's resolution of conflicting testimony." Ritter v. Ashcroft, 561 S.W.3d 74, 84 (Mo. App. W.D. 2018) (quoting Chastain v. James, 463 S.W.3d 811, 817 (Mo. App. W.D. 2015)). Therefore, "the only question before this court is whether the trial court drew the proper legal conclusions from the facts stipulated." Id. (quoting Chastain, 463 S.W.3d at 817). Here, the trial court's ruling was based on the interpretation and application of ...


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