NYCLU Files Lawsuit Against Lobbying Commission Over Free-Speech Billboard

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK ----------------------------------------------------- NEW YORK CIVIL LIBERTIES UNION, Plaintiff, vs. DAVID GRANDEAU, Executive Director of the New York State Temporary State Commission on Lobbying, Defendant. ----------------------------------------------------- COMPLAINT 03 Civ. Preliminary Statement 1. This is an action to vindicate the civil rights of organizations that engage in a range of First Amendment protected advocacy that includes lobbying as well as nonlobbying activity such as public education and litigation. The New York Temporary State Commission on Lobbying is seeking to expand the reach of New York State’s lobbying registration and disclosure regime to advocacy that makes no mention of any pending legislation but that is on an issue that also is the subject of lobbying. This attempted expansion of the state registration and disclosure regime poses a serious threat to the First Amendment rights of advocacy organizations. 2. The plaintiff New York Civil Liberties Union is a not-for-profit organization that engages in a range of advocacy that includes lobbying and as well as other expressive activity that is not lobbying. Consistent with this work, the NYCLU earlier this year, in response to the arrest at an Albany-area shopping mall of a person wearing an anti-war t-shirt, sponsored a message on a billboard outside the mall promoting the right of people to exercise their free-speech rights at shopping malls. When the NYCLU unveiled the billboard, it also endorsed in Albany a specific legislative proposal that was prompted by the arrest. The billboard made no mention of the legislative proposal nor did it exhort any action on the part of anyone. In its entirety, the billboard’s text read: “Welcome to the mall. You have the right to remain silent. Value free speech. www.nyclu.org”. 3. On October 28, 2003, in the midst of litigation in which the NYCLU is supporting a challenge to the Lobbying Commission’s effort to extend the state’s lobbying laws to a public rally, the NYCLU received from the Lobbying Commission a letter asserting that expenses associated with the billboard were subject to lobbying registration and disclosure requirements and demanding that the NYCLU file registration information about the billboard by November 7, 2003. 4. The Lobbying Commission’s effort to extend the New York State lobbying reporting and disclosure regime to advocacy that makes no mention of any pending legislation and that calls for no action on any such legislation substantially and unnecessarily burdens the First Amendment rights of advocacy organizations that engage in lobbying as well as other advocacy activity. The plaintiff seeks a declaratory judgment, preliminary and permanent injunctive relief enjoining any further inquiry by the Lobbying Commission into non-lobbying advocacy work of the NYCLU, and attorneys’ fees. Jurisdiction And Venue 5. This court has subject-matter jurisdiction over the plaintiff’s claims pursuant to 28 U.S.C. §§ 1331, 1343(3-4). 6. Venue is proper pursuant to 28 U.S.C. § 1391(b) in that plaintiff’s claims arise in the Southern District of New York. 7. Jurisdiction to grant declaratory judgment is conferred by 28 U.S.C. §§ 2201, 2202. Injunctive relief is authorized by Rule 65 of the Federal Rules of Civil Procedure. An award of costs and attorneys fees is authorized pursuant to 42 U.S.C. § 1988. Parties 8. Plaintiff NEW YORK CIVIL LIBERTIES UNION is a not-for-profit advocacy organization that has its principal office in Manhattan. 9. The defendant DAVID GRANDEAU is the Executive Director of the New York Temporary State Commission on Lobbying. He is sued in his official capacity for injunctive relief. Facts 10. The plaintiff New York Civil Liberties Union is a not-for-profit membership organization that advocates on a range of issues bearing on matters of public concern. Founded in 1951 as the New York State affiliate of the American Civil Liberties Union, the NYCLU for decades has engaged in a full range of advocacy, including lobbying, litigation, and public education. 11. The NYCLU is a registered lobbyist in New York State and routinely files reports with the New York Temporary State Commission on Lobbying in which it identifies its lobbying activities and lists salaries and expenses associated with those lobbying activities. Those reports are prepared by a senior member of the NYCLU who works out of the NYCLU’s Manhattan office. 12. As the Executive Director of the New York Temporary State Commission on Lobbying, the defendant David Grandeau exercises direct control over the operations of the Lobbying Commission, including the conduct of its investigations. The Lobbying Commission is an agency of the State of New York that engages in regulatory activity throughout the state. 13. On many of the issues about which it engages in lobbying, the NYCLU also engages in a range of advocacy that is not lobbying. This advocacy includes, but is not limited to, public speaking, publications, press relations, and litigation. The NYCLU regularly pays salaries and incurs substantial expenses in conjunction with this activity. 14. On March 3, 2003, Stephen Downs was arrested at the Albany-area Crossgates Mall, which is owned and operated by the Pyramid Management Group. Mr. Downs was arrested for wearing a t-shirt bearing the words “Give Peace a Chance,” which was a reference to the public debate then taking place about the threatened invasion of Iraq by the United States. 15. For decades the NYCLU (as well as ACLU offices in other states) has been involved in advocating for the recognition of free speech rights in private, shopping malls. This work included litigation seeking to establish such a right under the New York State Constitution. See SHAD Alliance et al. v. Smith Haven Mall, 66 N.Y.2d 496, 498 N.Y.S.2d 99 (1985). 16. A March 6, 2003, report in The New York Times about the arrest of Mr. Downs quoted NYCLU Legal Director Arthur Eisenberg criticizing Mr. Downs’s arrest and the curtailment of his freedom of speech:

Arthur Eisenberg, the legal director of the New York Civil Liberties Union, called Mr. Downs’s arrest an example of a shopping mall trying to censor free-speech rights of its patrons. “We wonder where such censorship will end,” he said. “Will the mall start prohibiting customers from wearing political buttons? Will it prohibit Sikhs from wearing turbans. The ultimate point is that we are a diverse society in which individuals hold diverse views.”

17. On March 11, 2003, the NYCLU wrote to the Pyramid Management Group about the arrest of Mr. Downs and the company’s free-speech policies at the Crossgates Mall and at other malls owned by Pyramid. 18. Shortly after his arrest, criminal charges against Mr. Downs were withdrawn. Mr. Downs then retained the NYCLU to represent him in possible civil proceedings, and the NYCLU continues to represent Mr. Downs as of the filing of this complaint. 19. In the aftermath of the considerable publicity attending the arrest of Mr. Downs and the efforts of the NYCLU, an individual approached the NYCLU to offer assistance to the NYCLU in promoting its views on free-speech rights at shopping malls through the placement of a message on a billboard near the Crossgates Mall. The NYCLU accepted the offer and participated in developing the text to be used on the billboard. 20. Virtually all of the work done by the NYCLU in conjunction with the Crossgates Mall billboard was done in the NYCLU’s Manhattan offices by senior members of the NYCLU. 21. Independent of and subsequent to these developments, a New York State Assembly Member prepared a bill that he intended to introduce that would entitle New Yorkers to exercise free-speech rights in shopping malls in New York State. Consistent with its position on this issue and with its longtime participation in legislative advocacy, the NYCLU extensively communicated with the Assembly Member about development of this proposal and publicly endorsed the proposal at a news conference that took place on in Albany on March 31, 2003. 22. At the same time that it endorsed the legislative proposal, the NYCLU announced the unveiling of the billboard at the Crossgates Mall. The billboard featured an image of a person who was gagged with material wrapped around his head and mouth and included the following text: “Welcome to the mall. You have the right to remain silent. Value free speech. www.nyclu.org”. The billboard made no mention of the legislative proposal and did not call on anyone to take any action with respect to the proposal. The billboard remained up for one month. (A photograph of the billboard is attached as Exhibit A.) 23. The legislative proposal subsequently was formally introduced as a bill. As it often does with bills about civil-liberties matters, the NYCLU prepared and distributed a legislative memorandum analyzing the bill. 24. Meanwhile, the NYCLU also continued to engage in nonlobbying activity in support of free speech rights in private shopping malls. As just one example, the NYCLU published in its May-June newsletter a story about the issue in which it explained to its members and others that it was pursuing “two avenues in defense of free speech rights in public commercial spaces such as malls.” One avenue was support of the bill, and the other was sponsorship of the billboard. 25. In early July 2003, a senior member of the NYCLU who primarily works in the NYCLU’s Manhattan office prepared the standard semi-annual report that the NYCLU routinely files with the Lobbying Commission. In that report, which covered the first six months of 2003, the NYCLU included all lobbying work done in conjunction the New York State Assembly bill, including its appearance at the Albany press conference. The NYCLU did not include in its report information about the billboard or any other of its nonlobbying work concerning free-speech rights in shopping malls. 26. On July 28, 2003, a complaint was filed in the Southern District of New York challenging, among other things, an effort by the New York Temporary State Lobbying Commission to extend New York’s lobbying registration and disclosure regime to a June 2003 public rally held near City Hall in Manhattan on the subject of the “Rockefeller drug laws.” The case, Hip-Hop Summit Action Network v. New York Temporary State Commission on Lobbying, was assigned to the Honorable Loretta Preska. 27. Shortly after the filing of the complaint in Hip-Hop Summit Action Network, Judge Preska presided over a hearing to consider the plaintiff’s request for a temporary restraining order against the Lobbying Commission’s investigation into the City Hall rally. At that hearing, the NYCLU sought and received leave to participate as amicus curiae, and it has been an active participant in the case since then. The most recent hearing in that matter took place on October 23, 2003. 28. The defendant David Grandeau also has been an active participant in the court proceedings. And in an affidavit dated October 20, 2003, Mr. Grandeau assailed allegations about his conduct made by the NYCLU in a submission to the court dated October 10, 2003. 29. On October 28, 2003, the NYCLU received a letter from the New York State Lobbying Commission concerning the Crossgates Mall billboard. The body of the letter, which is dated October 23, 2003, is as follows (with emphasis as included in the letter):

The Commission has reviewed your January/June 2003 Client Semi-Annual Report dated July 15, 2003. As you know, reportable lobbying expenses include the funding of parties, receptions and all events which are hosted by the client with a special interest in pending legislation or is in a proposed rule or regulation to which government and/or State officials are invited (Commission Opinion No. 84-1). The Commission is aware of an expense for advertising on a billboard. It appears that certain costs of this event are reportable lobbying expenses and, therefore, must be reported as such. If NY Civil Liberties Union has incurred such an expense, Part III (C) and III (D) (total) of the enclosed 2003 Client Semi-Annual Report must be amended to reflect those lobbying expenses. Your response and the enclosed report must be submitted to this office within fifteen (15) days of the date of this letter. A new Client Semi-Annual report form is enclosed for your use in amending same. If you have questions regarding this matter, contact the undersigned.

(A copy of the letter is attached as Exhibit B.) 30. If the NYCLU could be required to report to the Lobbying Commission all advocacy on any issue about which it also engages in lobbying, that would dramatically expand the scope of the NYCLU’s registration and disclosure obligations. The NYCLU advocates on a wide range of issues, and much of its advocacy includes a legislative component that qualifies as lobbying (and about which the NYCLU fully reports). But if the NYCLU were forced to report to the Lobbying Commission about general public advocacy on issues that relate to legislative matters even where such advocacy does not involve lobbying, such reporting obligations would vastly increase the Commission’s regulatory authority over the NYCLU’s First Amendment activities. Extension of the Commission’s authority over such advocacy would violate strong First Amendment tradition holding, except in exceeding narrow circumstances not present here, advocacy organizations need not account to the government for their free-speech activities. 31. Registration and disclosure to the Lobbying Commission poses substantial burdens on an organization. Under New York’s lobbying law, an organization must submit sworn statements identifying all matters on which it is engaged in lobbying and reporting all salaries paid and all expenses over $75.00 incurred in conjunction with lobbying. To comply with these obligations, reporting organizations expend considerable resources accounting for relevant staff time and expenses. 32. To complete the reports it has been filing pursuant to the New York State lobbying law, the NYCLU has had to have a senior member of its staff expend considerable time documenting lobbying work done by NYCLU staff, calculating the salary costs associated with that work, and identifying all expenses incurred in conjunction with that work. If the NYCLU’s reporting obligations were expanded to cover all advocacy work on any issue about which the NYCLU also was engaged in lobbying, the administrative burdens on NYCLU staff would increase dramatically, as it would have to track and report a substantial portion of the work of all of its staff members. 33. Beyond the increased burden associated with reporting, the expansion of the advocacy about which the NYCLU would have to report would open the NYCLU and its staff to highly intrusive investigations by defendant David Grandeau and his staff. The New York State lobbying law authorizes the Lobbying Commission to review filings, and pursuant to this authority the Lobbying Commission conducts investigations into the internal operations of advocacy organizations under the guise of ascertaining the accuracy of registration filings. These investigations include sweeping requests for documents and demands for sworn testimony about advocacy efforts. 34. The sequence of events leading up to the litigation pending before Judge Preska in Hip- Hop Summit Action Network v. New York Temporary State Commission on Lobbying illustrates the risks that organizations face when reporting to the Lobbying Commission. In that matter, an advocacy organization involved in drug-law reform work received a letter -- not unlike the October 23 letter received by the NYCLU -- demanding that the organization provide the Lobbying Commission with information about activity the Commission considered to be lobbying. Though asserting that they were not engaged in lobbying, the organization chose to file a registration statement, apparently in the belief that this would satisfy the Lobbying Commission and resolve the matter. To the contrary, the filing simply prompted the Lobbying Commission to launch a formal investigation into a City Hall rally sponsored by the organization and to issue a sweeping subpoena to the organization. Among other things, that subpoena required the organization to produce copies of minutes from private meetings with those involved in planning the rally, to produce copies of correspondence with groups and individuals involved in the rally, and to produce extensive documents concerning the financing of the rally. 35. In addition, as part of the same investigation, defendant David Grandeau demanded that a senior member of another advocacy group involved in drug-law reform work appear at the Lobbying Commission offices and give sworn testimony about filings made by that group. In that deposition, which took place August 13, 2003, Mr. Grandeau questioned the staff member about a wide range of advocacy work undertaken both by her organization and by other organizations with which she had worked. 36. The NYCLU is deeply concerned about any efforts by government agencies, including agencies of the State of New York, to delve into internal aspects of its advocacy work. The threat of potential investigations of the NYCLU by the Lobbying Commission is particularly chilling given that the NYCLU is often engaged in advocacy directed at the State of New York and its subsidiaries. The very possibility that the NYCLU would have to start reporting to a New York State agency about most of its activities and in doing so would open itself up to state investigations into the internal workings of the NYCLU poses a substantial threat to the NYCLU’s First Amendment rights. 37. Finally, expansion of the scope of advocacy activity subject to New York’s registration and disclosure regime would increase substantially the risk that advocacy organizations would be subjected to ongoing monitoring by the Lobbying Commission and Mr. Grandeau. Upon information and belief, the Lobbying Commission affirmatively seeks to identify activity that might be subject to registration requirements but that is not being reported to the Commission. Were the scope of the state’s lobbying registration and disclosure regime to reach advocacy that made no mention of any legislative proposal and that did not call for any action on a legislative proposal simply because the organization involved in the advocacy was separately lobbying on the same issue, that would open the door to virtually unchecked monitoring of First Amendment activity by the Lobbying Commission. The threat of such monitoring would further chill the First Amendment rights of advocacy organizations such as the NYCLU. 38. Given current reporting requirements, the NYCLU believes that there is a substantial likelihood that any filing it would make about the Crossgates Mall billboard would prompt an investigation by the Lobbying Commission. Any such investigation could include sweeping subpoenas and demands that senior members of the NYCLU appear before Mr. Grandeau for questioning under oath about the advocacy activities of the NYCLU and about the sources of financial and other support received by the NYCLU for its advocacy work. 39. The potential chilling effect of the defendant’s actions is compounded by the policy and practices of the Lobbying Commission and Mr. Grandeau to release to the public and press obtained during the course of Lobbying Commission investigations. 40. The defendant’s actions are being taken under color of law. First Cause Of Action 41. The defendant’s actions violate the First Amendment of the United States Constitution and 42 U.S.C. § 1983. WHEREFORE, the plaintiff requests that this court: (1) Assume jurisdiction over this matter; (2) Issue a declaratory judgment that the defendant has violated the First Amendment by demanding that the NYCLU report as lobbying advocacy that makes no mention of pending legislation nor exhorts any action with respect to pending legislation, including but not limited to its erection of the billboard outside the Crossgates Mall; (3) Issue a preliminary injunction enjoining the defendant from forcing the NYCLU to report as lobbying advocacy that makes no mention of pending legislation nor exhorts any action with respect to pending legislation, including but not limited to its erection of the billboard outside the Crossgates Mall; (4) Issue a permanent injunction enjoining the defendant from forcing the NYCLU to report as lobbying advocacy that makes no mention of pending legislation nor exhorts any action with respect to pending legislation, including but not limited to its erection of the billboard outside the Crossgates Mall; (5) Award the plaintiff attorneys’ fees; and (6) Grant any other relief the court deems appropriate. Respectfully submitted, NEW YORK CIVIL LIBERTIES UNION FOUNDATION, by _____________________________ CHRISTOPHER DUNN (CD-3991) ARTHUR EISENBERG (AE-2012) 125 Broad Street, 17th Floor New York, N.Y. 10004 (212) 344-3005 Counsel for the Plaintiff Dated: October 30, 2003 New York, N.Y.