City of Grant v. Smith

City of Grant, by and through its City Clerk, Kim Points, Respondent, v. John D. Smith, Relator.

A16-1070

STATE OF MINNESOTA IN COURT OF APPEALS

March 13, 2017

This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (2016).

Affirmed

Johnson, Judge

Office of Administrative Hearings

File No. OAH 8-0325-33077

Amanda E. Prutzman, Eckberg Lammers, P.C., Stillwater, Minnesota (for respondent)

Richard D. Donohoo, Maplewood, Minnesota; and

Theresa R. Paulson, St. Paul, Minnesota (for relator)

Considered and decided by Tracy M. Smith, Presiding Judge; Johnson, Judge; and Reyes, Judge.

UNPUBLISHED OPINION

JOHNSON, Judge

The City of Grant held a special election in which residents voted on a proposed city charter. Before the election, a group of residents distributed campaign literature supporting the proposed charter. The literature bore the city's logo and other design features that appear in city documents and on the city's website. The city clerk filed a complaint alleging a violation of the Fair Campaign Practices Act on the ground that the group's campaign literature falsely implied that the city was endorsing the proposed charter. After an evidentiary hearing, a panel of three administrative law judges found a violation of the act and imposed a $250 penalty on John D. Smith, a member of the pro-charter group who was found to have taken certain actions that caused the campaign literature to be sent to city residents. Smith and his wife challenge the hearing panel's decision on multiple grounds. We affirm.

FACTS

The City of Grant is a statutory city of approximately 4,000 residents in Washington County. It was a farming community in prior decades but has become increasingly residential. In its printed materials and on its website, the city often uses a logo, which consists of a depiction of a log cabin in front of two pine trees, the years in which the city was organized and incorporated, and the slogan, "A Home in the Country." When the city uses the logo on its newsletter, it superimposes the words "Grant News" over the log cabin.

In October 2015, the city held a special election on two questions. In the first ballot question, residents were asked whether the city should establish a home-rule charter.¹ Inthe second ballot question, residents were asked whether to discharge the city's charter commission.² The city itself did not take a position on either ballot question.

Groups of city residents organized on both sides of the ballot questions and took various actions to promote their respective points of view. A group called the Rally for the Charter Committee (RFTCC) supported the proposed charter. John D. Smith (hereinafter "Smith") was the treasurer of the group. He filed a campaign finance report on behalf of the group, and he listed his home address as the mailing address for the group. He attended approximately two-thirds of the group's meetings. His wife, Karen Y. Smith, did not attend any RFTCC meetings and was not actively involved in the campaign.

Before the election, RFTCC distributed campaign literature, including a one-page flyer and a tri-fold brochure. Both the flyer and the brochure urged residents to vote in the affirmative on the first question and in the negative on the second question. At the top of the flyer is the city logo. Near the logo are the words "City of Grant Minnesota" in a distinctive typeface that is very similar to the typeface the city uses for the same words in its printed materials and on its website. At the bottom of the flyer is the phrase, "Prepared and paid for [by] Rally for [the] Charter Committee," with a mailing address that is the Smiths' home address.

The tri-fold brochure is printed on both sides and folded in thirds such that it contains six panels. When folded, one of the external panels includes a space for the mailing address of the recipient and, in the space for a return address, the city logo with the words "Grant News" superimposed over the log cabin. Next to the logo are the words, "Reminder! City of Grant Special Election," and information about the date and hours of the special election and the place where the recipient could vote. The other external panel depicts a sample ballot, with votes superimposed in favor of the first question and against the second question. Inside the brochure, two panels contain text explaining the issues and urging voters to approve the charter. One panel contains four photographs with the city logo in the middle. And one panel lists city residents who support the proposed charter, including "John & Karen Smith." At the bottom of the brochure is the phrase, "This message prepared and paid for by Rally for the Charter Committee," with a mailing address that is the Smiths' home address.

Residents received the flyer in September 2015. The brochure was sent by mail in October 2015. Thereafter some recipients expressed concern that the literature implied that the city was endorsing the proposed charter. One married couple residing in the city sent an e-mail message to the city clerk, Kim Points, stating:

We found the attached notice on our mailbox this morning and are outraged that the Rally for Charter Committee is using the official City of Grant letterhead for the purpose of advancing their cause. We are hopeful that action will be taken by the City immediately to stop this unethical (and likely unlawful) election activity.

One city council member received the brochure, noticed the city logo, and contacted Points to ask whether the city had authorized the brochure. Points also received other questions and complaints about the mailings. In response to the complaints, Points placed a disclaimer on the city's website to clarify that the city did not have an official position on either ballot question. The city attorney sent a cease-and-desist letter to the Smiths, demanding that they stop using the city logo in RFTCC mailings.

On election day, the first question failed, and the second question passed. In other words, voters rejected the proposed charter and dissolved the charter commission.

In November 2015, a complaint was filed with the Office of Administrative Hearings (OAH), alleging that John Smith and Karen Smith made false claims of endorsement, in violation of the Fair Campaign Practices Act. See Minn. Stat. § 211B.02 (2016). The complainant was identified as "City of Grant by City Administrator / Clerk, Kim Points through City Attorney Nicholas J. Vivian." The complaint was signed by Vivian.

A panel of three administrative law judges (ALJs) conducted an evidentiary hearing in May 2016. The city called five witnesses: Points, Smith, a city council member, and two city residents. Points testified that, as city clerk, she administers city elections, maintains the city's records, assembles the city's newsletter, and posts information on the city's website. Points testified that the logo on RFTCC's literature is the city's logo and that the words "City of Grant Minnesota" on the literature are in the same typeface in which the same words are shown on the city's website. The city introduced exhibits that visually illustrated Points's testimony. The city council member and the two residents testified thatthey received RFTCC's literature and became concerned that some residents would be misled into believing that the city had sent the literature and was endorsing the charter. The city council member testified that she believed that the brochure implied that the city supported RFTCC's position. One of the residents testified that she had gone door to door to advise residents that the literature was not sent by the city.

Smith testified that he arranged for the printing and the mailing of the brochure but did not prepare the flyer or arrange for it to be printed. He testified that the city logo on one panel of the brochure was provided by the printer and that he decided to not change the brochure to omit the logo. He testified that the "Grant News" logo in the return-address field of the brochure was simply "an attention-getter" and that he chose it instead of the log cabin logo because of the word "news." But he testified that the logo "wasn't intended as any attempt to indicate this was coming from the City." He testified further that he hand-delivered some literature, possibly including the flyer, to newspaper receptacles of city residents.

After the city rested its case, Karen Smith moved for dismissal of the complaint with respect to her, and the hearing panel granted her motion. She then requested reimbursement of her costs. The hearing panel denied that request on the ground that the brochure stated that Karen Smith supported RFTCC and that RFTCC "was apparently . . . headquartered at" her home, which allowed "an inference that she was involved in the development of the literature that bore her address."

In June 2016, the hearing panel issued its findings of fact, conclusions of law, and order. The hearing panel concluded that Smith knowingly used the city's "logos andsymbols" in a way that "falsely implied that the City of Grant endorsed approval of Ballot Question 1 and opposed approval of Ballot Question 2." The hearing panel imposed on Smith a civil penalty of $250. Smith moved for reconsideration, but the hearing panel denied the motion on the ground that there is no authorization in the Fair Campaign Practices Act for a post-hearing motion for reconsideration. Both John Smith and Karen Smith appeal by way of a writ of certiorari.

DECISION

The statute on which this matter is based provides as follows:

A person or candidate may not knowingly make, directly or indirectly, a false claim stating or implying that a candidate or ballot question has the support or endorsement of a major political party or party unit or of an organization. A person or candidate may not state in written campaign material that the candidate or ballot question has the support or endorsement of an individual

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