Utter v. Building Industry Ass'n
341 P.3d 953
Wash.2015Background
- BIAW (nonprofit) created a for-profit subsidiary, BIAW‑MSC, to administer a workers’ compensation “retro” refund program (ROII); officers and staff overlap and the entities sometimes used the shorthand “BIAW.”
- In 2007 excess ROII refunds were solicited from local affiliates; funds were ultimately transferred to ChangePAC (a political committee) after pledges were solicited referencing “BIAW.”
- Petitioners Utter and Ireland sent a complaint to the Attorney General (AG); the AG referred it to the Public Disclosure Commission (PDC), which concluded BIAW‑MSC (not BIAW) may have violated the Fair Campaign Practices Act (FCPA); the AG sued BIAW‑MSC (settlement followed) but not BIAW.
- Plaintiffs then filed a citizen suit under the FCPA against BIAW alleging it was a political committee that failed to register and report; the trial court granted summary judgment for BIAW; the Court of Appeals affirmed on procedural grounds (holding the AG’s referral precluded the citizen suit).
- The Washington Supreme Court accepted review to decide (1) whether the PDC/AG referral precludes a citizen suit and (2) whether plaintiffs raised material factual disputes that BIAW met the statutory definition of a “political committee.”
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether AG/PDC referral "commenced an action" and thus bars a citizen suit | Referral to PDC did not constitute commencement of an "action" under RCW 42.17A.765(4); AG must actually bring a lawsuit to preclude citizens | Referral/investigation by AG/PDC counts as an action and thus precludes citizen suit | Court: Referral/investigation does not "commence an action"; citizen suit not procedurally barred unless AG/prosecutor actually files suit |
| Whether BIAW met the FCPA "contribution" prong of "political committee" (expectation of receiving contributions) | Documents and pledges referencing "BIAW" show BIAW expected and solicited contributions; creates fact issue | The funds were received and disbursed by BIAW‑MSC (not BIAW); generic use of "BIAW" shows no fact issue | Court: Plaintiffs raised a genuine issue of material fact that BIAW expected to receive contributions; summary judgment improper |
| Whether BIAW met the FCPA "expenditure" prong and applicable "purpose" test (when does advocacy trigger registration) | Documentary evidence (minutes, emails, officer statements) raises fact question that electioneering was one of BIAW’s primary purposes in 2007–08 | Even if some materials reference "BIAW," the expenditures were by BIAW‑MSC; if a purpose test applies it should be the stricter "the primary purpose" to avoid First Amendment problems | Court: Adopts the "a primary purpose" test (organizations having electioneering as one of their primary purposes may be regulated) and holds plaintiffs raised fact issues on the expenditure prong |
| Whether the FCPA "attribution" provision (RCW 42.17A.455) converts BIAW‑MSC activity into BIAW’s for political‑committee status | Attribution language applies "for purposes of this chapter," so it should apply to definition of "political committee," making BIAW automatically liable if it controlled BIAW‑MSC | Attribution was enacted to address contribution limits and aggregation, not to expand registration/reporting beyond its textual scope | Court: Construes attribution provision to apply to contribution limits (aggregation) only, not to determine political‑committee status, to avoid constitutional/overbreadth problems |
Key Cases Cited
- Dan J. Evans Campaign Comm. v. State, 86 Wn.2d 503 (Wash. 1976) (discusses when an entity’s purposes trigger disclosure as a political committee)
- Human Life of Wash., Inc. v. Brumsickle, 624 F.3d 990 (9th Cir. 2010) (upheld regulation applying to groups with a primary purpose of political advocacy under exacting scrutiny)
- Buckley v. Valeo, 424 U.S. 1 (U.S. 1976) (establishes exacting scrutiny for certain campaign finance regulations)
- Citizens United v. Federal Election Comm’n, 558 U.S. 310 (U.S. 2010) (addresses First Amendment and disclosure/independent expenditure regulation principles)
- In re Wash. Builders Benefit Tr., 173 Wn. App. 34 (Wash. Ct. App. 2013) (related litigation addressing ownership/control of ROII funds)
- Fritz v. Gorton, 83 Wn.2d 275 (Wash. 1974) (discusses constitutional considerations of citizen‑suit/initiative enforcement scheme)