January 18, 2018

Colorado Court of Appeals: Political Organization Required to Report Donations of Legal Services

The Colorado Court of Appeals issued its opinion in Campaign Integrity Watchdog v. Coloradans for a Better Future on Thursday, April 7, 2016.

Campaign—Contributions—Expenditures—Reporting.

This is the fourth in a series of complaints brought by claimant, Campaign Integrity Watchdog (CIW), or its principal officer, Matthew Arnold, against Coloradans for a Better Future (CBF), a political organization under CRS § 1-45-103(14.5), to challenge CBF’s alleged failure to report contributions and spending. Specifically, CIW challenged CBF’s spending on legal fees in 2012 and 2013, as well as donated legal services in 2013 and 2014. The administrative law judge (ALJ) found in favor of CBF.

On appeal, CIW argued that the ALJ erred in concluding that CBF did not need to report certain legal services as spending. The Colorado Court of Appeals disagreed. The money that CBF spent on legal services in 2012 or 2013 either for defending previous campaign finance complaints or for its attorney fees fell outside the category of expenditures defined by the Fair Campaign Practices Act. Therefore, it did not constitute reportable spending.

CIW also argued that the ALJ erred in concluding that CBF only needed to report contributions that were for the purpose of promoting a candidate’s nomination or election. The court agreed. CBF received “in-kind” contributions of legal services. It is undisputed that the legal services at issue were either a gift of services for which less than equivalent value was received (if the services were billed but not paid) or they were pro bono services. Therefore, CBF received a contribution that it was required to report.

The order was affirmed in part and reversed in part, and the case was remanded.

Summary and full case available here, courtesy of The Colorado Lawyer.

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