In 2012, Colorado’s Republican voters faced a choice in the campaign for Colorado University’s Board of Regents: Brian Davidson or Matthew Arnold? The campaign made headlines after Arnold admitted to lying about his educational credentials. And in the heat of this debate, Coloradans for a Better Future (CBF)—a 527 political organization—ran two radio ads, one promoting Davidson and one criticizing Arnold.
Arnold lost the race. Unfortunately for CBF, Arnold would go on to become the most prolific complainant under Colorado’s system of private campaign-finance enforcement. Under that system, “[a]ny person” can file a private lawsuit to enforce the state’s campaign-finance laws. And since 2014, Arnold has filed over 70 complaints, either personally or through a company he founded, called Campaign Integrity Watchdog (CIW).
Following his electoral defeat, Arnold started filing complaints against CBF, alleging various violations of campaign-finance law. After weathering Arnold’s third lawsuit, CBF filed a termination report with the Colorado Secretary of State. But this only prompted a fourth lawsuit by CIW, claiming that CBF failed to properly report the value of the time spent by an attorney filing the termination report as a campaign “contribution.”
CIW lost before the Office of Administrative Courts, but the Colorado Court of Appeals reversed, holding that free or reduced-cost legal services to political organizations like CBF qualified as contributions either as undercompensated services under Colo. Rev. Stat. § 1-45-103(6)(b) or as “gifts” under Colo. Rev. Stat. § 1-45-103(6)(c)(I).
Represented by the Institute for Justice, CBF sought review before the Colorado Supreme Court. The Court granted review and on January 29, 2018, unanimously reversed the Court of Appeals.
The Colorado Supreme Court’s ruling is a straightforward application of well-established principles of statutory interpretation, particularly the canon against surplussage and noscitur a sociis.
With regard to section 1-45-103(6)(b), concerning undercompensated services, the court noted that the value of these services is established in an amount “as determined by the candidate committee.” Based on this language, the court reasoned that the provision applied only to services rendered to candidate committees; otherwise, the phrase “as determined by the candidate committee” would be surplussage. The court rejected CIW’s argument that this interpretation led to absurd results, holding that “it is not absurd to make contribution laws stricter for candidate committees than for other entities.”
As for section 1-45-103(6)(c)(I), concerning “gifts” to political organizations, the court held that the word “gift” referred only to monetary gifts. To support this interpretation, the court looked to the other terms surrounding “gift,” which included “payment, loan, pledge, . . . advance of money, [and] guarantee of a loan.” Invoking the “familiar principle of statutory construction that words grouped in a list should be given related meaning,” the court had no trouble concluding that “gift” did not extend beyond monetary gifts. This interpretation also avoided surplussage in another subsection of the law, section 1-45-103(6)(c)(III), which regulates gifts of property.
The Colorado Supreme Court’s ruling will provide important protection for political speakers in Colorado. Campaign-finance law is notoriously difficult to comply with, and those compliance problems are only exacerbated by Colorado’s unique system of private campaign-finance enforcement. The Colorado Supreme Court’s ruling in Coloradans for a Better Future v. Campaign Integrity Watchdog ensures that political speakers can seek the legal help they need to navigate Colorado’s law without fear that doing so will open them up to retaliatory lawsuits from their political opponents.
Paul Sherman is a senior attorney at the Institute for Justice.