complaint - mi v. johnson

8/18/2019 Complaint - MI v. Johnson

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UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF MICHIGAN

SOUTHERN DIVISION

MICHIGAN STATE AFL-CIO; UTILITY WORKERSUNION OF AMERICA, AFL-CIO, LOCAL 223;GEORGE HORUCZI; INTERNATIONALBROTHERHOOD OF ELECTRICAL WORKERS,AFL-CIO, LOCAL 58; MICHIGAN STATE UTILITYWORKERS COUNCIL; and WILLIAM D. Case No.CHADWICK, JR.,

Plaintiffs, Hon.

v.

RUTH JOHNSON, IN HER OFFICIAL CAPACITYAS MICHIGAN SECRETARY OF STATE;and WILLIAM SCHUETTE, IN HIS OFFICIALCAPACITY AS MICHIGAN ATTORNEY GENERAL,

Defendants.

_____________________________________________ /

COMPLAINT FOR INJUNCTIVE AND DECLARATORY RELIEF

4:16-cv-11454-LVP-SDD Doc # 1 Filed 04/22/16 Pg 1 of 28 Pg ID 1


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NATURE OF THIS ACTION

This action challenges the constitutionality of a recent amendment to the

Michigan Campaign Finance Act The amendment, 2016 Public Act 269 (“PA

269”) selectively prohibits unions, but not corporations, from using the most

effective method of collecting voluntary contributions for spending in campaigns for

Michigan elective office. The 2016 election campaign season is fully underway.

Plaintiffs seek injunctive and declaratory relief to preserve their constitutional rights

to participate in this election.

Under the Michigan Campaign Finance Act, 1976 Public Act 388, M.C.L.

169.201 et seq. (“MCFA”), unions and corporations may not make contributions in

support of candidates with their general funds. They may do so only by

establishing a separate political committee called a separate segregated fund (“SSF”

or “PAC”). Union and corporate SSFs can be funded solely through voluntary

contributions from the union’s or corporation’s restricted class. A union’s

restricted class is comprised primarily of its members, as well as the union’s officers

and managerial employees. For-profit corporations may solicit contributions from

their officers, managerial employees and stockholders. Non-profit corporations may

accept SSF contributions from their officers and managerial employees and their

individual members, as well as from officers and managerial employees of their

corporate members.



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For union members, payroll deduction (often called “PAC check-off”) is by

far the most effective and widely used method for giving financial support to their

union’s political advocacy. Payroll deduction allows employees to contribute a

small amount (along with union dues and other deductions) with each payroll,

without the burden of writing a check or arranging for credit card or bank

transactions. Under the MCFA and Michigan’s Wages and Fringe Benefits Act,

M.C.L. 408.477, PAC check-off must be authorized by an employee in writing, and

must be entirely voluntary.

For unions representing employees in the private sector, the vast majority of

SSF contributions are received through PAC check-off administered by the

corporate employers of their members. Unions commonly negotiate PAC check-off

in their collective bargaining agreements with the employers. The payroll deduction

method has been in use in Michigan for many years.

A series of amendments to the MCFA enacted late in 2015 changed all that.

At the very end of the legislative session, a surprise, last-minute addition to a bill

containing routine amendments to the MCFA passed both houses, without hearings

and with little debate, in a single session that lasted well into the night. This

high-speed law making was virtually without precedent, other than in rare

emergencies.



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Among the many changes made in the resulting bill, 2015 Public Act 269

(“PA 269”), which went into effect immediately upon signing by the Governor, was

a selective, targeted ban on PAC check-off. As amended by PA 269, the MCFA

now allows corporations to continue using PAC check-off for their own SSFs and

for the SSFs of their trade associations. But under PA 269, it is now a felony for a

corporation to administer PAC check-off for its employees’ contributions to their

union’s SSF.

No explanation was given for amending the MCFA to treat unions and

corporations differently. This is not surprising, because there is no credible

rationale for the Legislature’s discriminatory and precipitous action. The political

agenda behind PA 269, which passed along party lines, was obvious to all. A

contemporaneous news report quoted a “source” describing the revisions “as a ‘head

shot’ to organized labor and the Democratic political candidates they support.”

Public Act 269 violates the U.S. Constitution in several respects. The First

Amendment right to express political views, associate and advocate in elections for

public office is accorded paramount protection. Prior to PA 269, the ability to collect

voluntary political contributions through payroll deduction was available to all

private sector entities in Michigan – for profit and non-profit corporations and

unions alike. Under PA 269 unions are now disqualified from using the most

effective means of political fundraising, while corporations remain free to employ it.



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Discriminatory government speech regulation that selectively favors some preferred

speakers over others are presumptively invalid; they are permitted only in very

limited contexts. In addition, apart from its selective application to certain

speakers, PA 269 significantly impairs the unions’ and their members’ exercise of

their rights of political speech and association; therefore it must satisfy strict

scrutiny, which requires the Government to identify a compelling interest and show

that the measure is narrowly tailored to achieve that interest. The government can

identify no compelling interest here and PA 269 fails under strict scrutiny. Indeed,

PA 269 fails even the lenient “rational basis” test, and therefore violates the Equal

Protection Clause. The government can assert no rational basis for selectively

prohibiting the use of PAC check-off based on the identity of the entity doing the

political fundraising. Finally, because PA 269 negates PAC check-off clauses in

existing collective bargaining agreements without serving any legitimate public

purpose, it violates the Contract Clause of the U.S. Constitution.

JURISDICTION AND VENUE

1. This Court has subject matter jurisdiction under 42 U.S.C. § 1983 and 28

U.S.C. §§ 1331 and 1343(a)(3) and (4), because this action seeks to redress

the deprivation, under color of state law, of rights secured by the U. S.

Constitution, and under 28 U.S.C. §§ 2201 and 2202, because this action

seeks declaratory relief.



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2. Venue is proper in this District under 28 U.S.C. §1391(b)(1) and Local Rule

83.10.

PARTIES

3. The Michigan State AFL-CIO is a labor federation comprised of constituent

labor organizations in Michigan. Local unions affiliated with the Michigan

State AFL-CIO represent hundreds of thousands of employees of corporate

employers located throughout Michigan. A primary objective of the Michigan

State AFL-CIO is to improve the quality of life for working families in

Michigan. In furtherance of this objective, the Michigan State AFL-CIO

encourages and assists affiliated labor unions in their participation in

Michigan elections, including the making of contributions to support

candidates for elective office. Plaintiff Michigan State AFL-CIO sues in a

representative capacity on behalf of its affiliated unions.

4. Plaintiff Local 223 of the Utility Workers Union of America, AFL-CIO,

(“UWUA Local 223”) is a labor union headquartered in Dearborn, Michigan.

UWUA Local 223 represents approximately 3,500 employees in Michigan

employed by DTE Electric Company, DTE Gas Company, and DTE

Corporate Services LLC (collectively referred to as “DTE Energy”).



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5. Plaintiff George Horuczi resides in Riverview, Michigan. Plaintiff Horuczi

is an employee of DTE Electric Company. He is a member and an officer of

UWUA Local 223.

6. Plaintiff International Brotherhood of Electrical Workers, AFL-CIO, Local

58 (“IBEW Local 58”) is a labor union headquartered in Detroit, Michigan.

IBEW Local 58 has collective bargaining agreements with numerous

employers throughout southeastern Michigan and represents approximately

4,500 members working as electricians in the construction industry, and in the

sound and communications, broadcast, maintenance, and manufacturing

industries.

7. Plaintiff Michigan State Utility Workers Council (“MSUWC”) is a labor

organization headquartered in Charlotte, Michigan, that conducts business in

the Eastern District of Michigan. Plaintiff MSUWC is comprised of and

represents 24 local unions affiliated with the Utility Workers Union of

America, AFL-CIO, which themselves represent approximately 3,800

employees working in Michigan’s utility industry as linemen, gas line

construction and maintenance workers, and power plant operators and

maintenance workers.

8. Plaintiff William D. Chadwick, Jr., resides in West Olive, Michigan.

Plaintiff Chadwick is an employee of Consumers Energy. He is a member of



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Utility Workers Union of America, Local 388, which is affiliated with

Plaintiff MSUWC.

9. Defendant Ruth Johnson is the Secretary of State of the State of Michigan and

is sued in her official capacity. Defendant Johnson is the chief election officer

of the state and has responsibility for enforcement of the MCFA under Section

15, M.C.L. 169.215.

10. Defendant William Schuette is the Attorney General of the State of Michigan

and is sued in his official capacity. Defendant Schuette also has responsibility

for enforcement of the MCFA under Section 15, M.C.L. 169.215.

BACKGROUND FACTS

Payroll Deduction for Voluntary Political Contributions

11. Under the MCFA, unions may not contribute to candidates for Michigan

elective office or to political parties directly with their general treasury funds.

M.C.L. 169.254(1). A union must establish a Michigan political committee

and separate account, called a separate segregated fund (“SSF”), for the

purpose of making contributions or expenditures to support or oppose

candidates for elective office in Michigan. M.C.L. 169.255(1).

Contributions for a union SSF may be solicited only from the union’s

members, as well as from officers and managerial employees of the union.

M.C.L. 169.255(4).



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12. Until the events giving rise to this action, the MCFA permitted employers to

enter into an agreement with a union for the payroll deduction of voluntary

contributions from employees to the union’s SSF (often referred to as a “PAC

check-off”), subject to certain conditions and restrictions. M.C.L. 169.255(6).

For example, employee contributions must be voluntary and may not be

coerced, and payroll deduction could be used only if the employee

affirmatively consented to the payroll deduction in writing on an annual basis.

13.

A union may pay from its general treasury funds for the establishment,

administration or solicitation of contributions to its SSF. M.C.L.

169.206(2)(c). A corporate employer may not pay the expense of soliciting

contributions to a union’s SSF. M.C.L. 169.206(1)(d). Under interpretive

rulings issued by the Secretary of State, unions may reimburse employers for

the use of their payroll systems for union PAC check-off, in order to avoid a

prohibited in-kind contribution by an employer to the union’s SSF.

14. Unions and their members rely heavily on employer payroll deduction for the

collection of members’ voluntary contributions to the unions’ SSFs. Payroll

deduction is by far the most efficient and effective method for collecting

member contributions to a union SSF. Other methods of obtaining member

contributions, such as individual solicitation, or electronic payment methods



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such as EFT and credit cards, are more burdensome and far less effective than

regular deduction from pay.

The Enactment of 2016 PA 269

15. On October 20, 2015, Senate Bill 571 was introduced in the Michigan Senate.

Senate Bill 571 contained the following changes to the MCFA: removing the

requirement that written consent to automatic or payroll deduction

contributions to an SSF be renewed annually, and permitting a “connected

organization” (the entity that establishes the SSF) to commingle SSF

contributions with other general assets and later transmit the contributions

separately to the SSF, provided certain requirements were met.

16. The bill was referred to the Senate’s Elections and Government Reform

Committee, which reported the bill out, without any hearings, nine days later.

17.

On November 4, 2015, the Senate unanimously passed Senate Bill 571

without amendment and gave it immediate effect. The bill was referred to

the House.

18. The House referred S.B. 571 to the Committee on Elections. No hearings

were held and the bill was reported to the House without amendment.

19. On December 16, 2015, the last day of legislative voting in 2015, in a session

lasting nearly 12 hours, the House radically revised Senate Bill 571 as passed

unanimously by the Senate. A floor substitute S.B. 571 (H-3) was



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introduced. The House substitute bill expanded the size of the original Senate

bill from 11 to 52 pages. Among the many additional amendments in the

House substitute bill that day were the following (new language bolded and

capitalized):

a. The substitute bill inserted a new Sec. 54(3), MCL 169.254(3), as

follows:

EXCEPT FOR EXPENDITURES MADE BY A

CORPORATION IN THE ORDINARY COURSE OF ITS

BUSINESS, AN EXPENDITURE MADE BY ACORPORATION TO PROVIDE FOR THE COLLECTION

AND TRANSFER OF CONTRIBUTIONS TO ANOTHER

SEPARATE SEGREGATED FUND NOT ESTABLISHED BY

THAT CORPORATION, OR TO A SEPARATE

SEGREGATED FUND NOT CONNECTED TO A

NONPROFIT CORPORATION OF WHICH THE

CORPORATION IS A MEMBER, CONSTITUTES AN

IN-KIND CONTRIBUTION BY THE CORPORATION AND

IS PROHIBITED UNDER THIS SECTION. ADVANCED

PAYMENT OR REIMBURSEMENT TO A CORPORATION

BY A SEPARATE SEGREGATED FUND NOT

ESTABLISHED BY THAT CORPORATION, OR BY A

SEPARATE SEGREGATED FUND NOT CONNECTED TO

A NONPROFIT CORPORATION OF WHICH THE

CORPORATION IS A MEMBER, DOES NOT CURE A USE

OF CORPORATE RESOURCES OTHERWISE

PROHIBITED BY THIS SECTION.

b. The substitute bill added the following sub-section (3)(d) to Section 4,

M.C.L. 169.204(3)(d), defining “contribution”:

(3) Contribution does not include any of the following: . . .



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(D) A CONTRIBUTION OR EXPENDITURE FOR THE

ESTABLISHMENT OR ADMINISTRATION OF, OR

SOLICITATION, COLLECTION, OR TRANSFER OF

CONTRIBUTIONS TO, A SEPARATE SEGREGATED

FUND IF THAT CONTRIBUTION OR EXPENDITURE WAS

MADE BY THE PERSON THAT ESTABLISHED THE

SEPARATE SEGREGATED FUND AS AUTHORIZED

UNDER SECTION 55, OR WAS MADE BY A PERSON

THAT IS A MEMBER OF A NONPROFIT CORPORATION

THAT ESTABLISHED THE SEPARATE SEGREGATED

FUND AS AUTHORIZED UNDER SECTION 55.

c. The substitute bill also made the following changes to sub-section

6(2)(c), M.C.L. 169.206(2)(c), describing an exception to the definition of

“expenditure,” as follows:

(2) Expenditure does not include any of the following: . . . . (c) Anexpenditure for the establishment, OR administration OF, orsolicitation, COLLECTION, OR TRANSFER of contributions to,a separate segregated fund if that expenditure was made by the

person who THAT established the separate segregated fund asauthorized under section 55, OR MADE BY A PERSON WHO ISA MEMBER OF A NONPROFIT CORPORATION THAT

ESTABLISHED THE SEPARATE SEGREGATED FUND AS

AUTHORIZED UNDER SECTION 55.

20. The House adopted the substitute Senate bill along party lines, and gave it

immediate effect.

21. The bill returned to the Senate late that evening. Invoking a rarely used

parliamentary procedure, the Senate Majority Leader removed all staff from

the Chamber and forbade Senators from leaving the floor. The Senate voted

along party lines to concur in the House substitute bill.



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22. A number of Senators rose to speak in protest. Senator Steve Bieda stated:

“This bill actually started off as a pretty good bill, and it turned into something

totally different.” (Senate Journal December 16, 2015, No. 111, p. 2084)

Senator Coleman A. Young III protested: “This is a hell of a way to start out

the Christmas holiday. First you wipe all our staff off the floor, then you cut

off debate, and now we are voting on this corporate takeover. I thought we

were a government of the people, for the people, and by the people. Now, after

this bill, we are going to be a government of the corporation, for the

corporation, and by the corporation. This is ridiculous. . . . No one read this

bill, and no one knows what is in it. It might as well be Peggy Bundy’s

mystery meat, because nobody knows what this bill does or what it is. I just

think it is ridiculous.” ( Id.)

23.

SB 571 was presented to Governor Rick Snyder on December 28, 2015. The

Governor signed the Bill on January 6, 2016. Senate Bill 571 was enrolled as

2015 Public Act 269.

24. The process used to radically transform Senate Bill 571 and rush it to passage

through both houses in a single day was extraordinary and virtually

unprecedented in the absence of an imminent emergency.



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25. There is no legislative history, legislative report or commentary that explains

why PAC check-off, which had been available to corporations and unions

alike for many years, was prohibited for unions.

26. Public Act 269 was adopted for the purpose and with the intended effect of

suppressing political speech and participation in electoral politics by

Michigan unions and their members.

The Foreseeable – and Intended --Effect of Public Act 269

27.

The amendments made by Public Act 269 at issue in this case have had and

will have the following foreseeable effects:

a. PAC check-off is available to corporations (and their trade

associations). A corporation may use payroll deduction for contributions to

its own SSF and for contributions to the SSF of a non-profit corporation (such

as a trade association) of which the corporation is a member.

b. PAC check-off no longer is available to unions and their members.

Corporations now are prohibited from performing their agreements to provide

PAC check-off for employees’ contributions to their union’s SSF. A

corporation providing union PAC check-off is considered to be making a

prohibited in-kind contribution to the union’s SSF. Violation is a felony

punishable, if the person is an individual, by a fine of up to $5,000.00 or



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imprisonment for up to 3 years or both, or if the person is not an individual, by

a fine of up to $10,000.00. M.C.L. 169.254(5).

c. The ability to avoid a prohibited corporate contribution by the

union’s SSF reimbursing the employer’s cost is eliminated. Under PA 269,

full reimbursement given by a union’s SSF to a corporate employer for the

employer’s expenses incurred in providing payroll deduction, either in

advance or after the fact, does not avoid or “cure” a violation.

The Imminent and Irreparable Harm to Plaintiff Unions’ and their Members’ Political Expression and Association, and Contract Rights

Plaintiff UWUA Local 223

28. Among the organizational purposes of UWUA Local 223, as reflected in its

Constitution and Bylaws and in its Mission Statement, is to provide its

members with a voice in the workplace and in the larger community by, inter

alia, active participation in the political and legislative process. In support of

this organizational purpose, Local 223 has established and maintains a

separate segregated fund called the “Local 223 UWUA PAC Fund,” which

makes contributions to Michigan candidate committees.

29.

UWUA Local 223 and DTE Energy have for a number of years been parties to

a series of collective bargaining agreements (“CBAs”) covering the various

bargaining units at DTE Energy. The most recent CBA is effective March



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23, 2013 to October 9, 2017 with respect to employees in the Gas Division

bargaining unit, and effective March 23, 2013 to June 5, 2017 with respect to

employees in other DTE Energy bargaining units.

30. In the current and several previous CBAs, UWUA Local 223 and DTE

Energy negotiated a provision pursuant to which DTE Energy agreed to

deduct contributions to the Local 223 UWUA PAC Fund from the wages of

each employee who individually and voluntarily authorized such a deduction

in writing. As a result, DTE Energy has for a number of years deducted and

forwarded to the Local 223 UWUA PAC Fund the voluntary contributions of

those employees who voluntarily signed written authorizations to have these

contributions deducted from their paychecks.

31. Pursuant to his written authorization, Plaintiff George Horuczi’s employer,

DTE Electric Company, has been deducting his contributions to the Local 223

UWUA PAC Fund from his pay for a number of years. Plaintiff Horuczi’s

employer also has been deducting Plaintiff Horuczi’s contributions to its own

corporate SSF. In January, 2016, without informing Plaintiff Horuczi, DTE

Electric Company stopped deducting contributions on his behalf to the Local

223 UWUA PAC Fund; DTE Electric Company continued deducting

contributions to its own SSF from Plaintiff Horuczi’s pay. Plaintiff Horuczi

did not discover that his employer had discontinued his union PAC check-off



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until several weeks later. Plaintiff Horuczi believes that if payroll deduction is

no longer available, it will be more difficult for him and other members to

provide financial support for his union’s political activity on a regular basis.

32. On about March 15, 2016, DTE Energy advised UWUA Local 223 that

because of PA 269, it had ceased all payroll deductions to the Local 223

UWUA PAC Fund.

33. UWUA Local 223 and its members are justly concerned that other employers

may follow suit. There is no readily available replacement for payroll

deduction that would allow members to continue their voluntary contributions

to the Local 223 UWUA PAC Fund without significant difficulty and

expense; no alternative method would come close to matching the

effectiveness of payroll deduction in facilitating and maximizing member

participation in UWUA Local 223’s SSF. The foreseeable result is that

UWUA Local 223 will have no way of avoiding a substantial reduction in

funding to the Local 223 UWUA PAC, which will severely inhibit UWUA

Local 223’s ability to participate and advocate on behalf of its members in the

2016 election in Michigan.

IBEW Local 58

34. In furtherance of its organizational interest in representing and advocating for

the interests and welfare of its members, Plaintiff IBEW Local 58 has



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established a Michigan separate segregated fund, called “Local Union No. 58

International Brotherhood of Electrical Workers Committee,” which makes

contributions to Michigan candidate committees. Members of IBEW Local

58 contribute to the Local’s SSF through payroll deduction plans provided for

in the collective bargaining agreements between their employers and IBEW

Local 58. Approximately 70 per cent of the Local’s members who contribute

to the Local’s SSF do so through negotiated payroll deduction programs.

35.

IBEW Local 58 and its members are justly concerned that PA 269’s

prohibition of PAC check-off will impair and inhibit the ability of IBEW

Local 58 members to make voluntary contributions on an automatic and

regular basis to the Local’s SSF. In particular, a number of collective

bargaining agreements covering a large number of members are set to expire

in the next several weeks. IBEW Local 58 is concerned that because of PA

269, employers will refuse to renew the payroll deduction agreements.

36. The foreseeable effect of PA 269 will be to substantially diminish the amount

of member contributions to IBEW Local 58’s SSF. Payroll deduction is the

familiar and accepted method for the Local’s members to make voluntary

contributions to the Local’s SSF. There would be significant practical and

financial obstacles to replacing payroll deduction, and no alternative method

could come close to payroll deduction in effectiveness and efficiency. The



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effect would be to significantly reduce the amount of voluntary member

funding that IBEW Local 58 can use to participate on behalf of its members in

the election.

MSUWC

37. Members represented by unions affiliated with MSUWC are employed under

collective bargaining agreements with several large utilities, including

Consumers Energy, Midland Cogeneration Venture (MCV), and the Entergy

Palisades Nuclear Power Plant. These employers have agreed to payroll

deduct voluntary employee contributions to Plaintiff MSUWC’s SSF, the

“Michigan State Utility Workers AFL-CIO PAC,” which makes contributions

to Michigan candidate committees.

38. Without payroll deduction, Plaintiff MSUWC would be forced to use far less

effective and more expensive methods of collecting members’ SSF

contributions. MSUWC and its members are justly concerned that the

predictable result of PA 269 will be a significant diminution of PAC funds

available to MSUWC for political advocacy and participation in campaigns

for elective office in Michigan.

39. Pursuant to his written authorization, Plaintiff William D. Chadwick Jr.’s

employer, Consumers Energy, has been deducting his contributions to

Michigan State Utility Workers AFL-CIO PAC from each payroll for a



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number of years. Plaintiff Chadwick believes that if payroll deduction is no

longer available, it will be more difficult for him and other members to

provide financial support for his union’s political activity on a regular basis.

The 2016 Election

40. The 2016 election campaign is well under way. Participation by Plaintiff

Unions in the Michigan election through their SSFs is crucially important in

furthering the Unions’ objectives of protecting and advocating for the interest

of their members.

41. Without the court’s intervention, as a direct and proximate result of the

enforcement of PA 269, the members of Plaintiffs UWUA Local 223, IBEW

Local 58, and MSUWC, and, upon information and belief, many other unions,

will be deprived of the ability to give financial support to their unions’

political speech through payroll deduction of their voluntary SSF

contributions, impairing their ability to participate in the political process and

exercise their First Amendment rights of political speech and association.

Public Act 269 will significantly diminish Plaintiff unions’ ability to

participate in the political process, and their exercise of their First

Amendment rights of political speech and association will be irreparably

harmed and impaired. Furthermore, Plaintiff unions’ constitutional, and



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federally protected, right to freely enter into contracts will be unjustifiably

impaired.

42. There is no legal remedy for the deprivation of political speech and

association and contract rights that Plaintiff Unions and their members will

suffer as a result of PA 269.

COUNT I

SELECTIVE DEPRIVATION OF FIRST AMENDMENT RIGHTS IN

VIOLATION OF THE FOURTEENTH AMENDMENT TO THE U.S.

CONSTITUTION: VIEWPOINT DISCRIMINATION

43. The First Amendment “has its fullest and most urgent application to speech

uttered during a campaign for political office." Citizens United v. FEC , 558

U.S. 310, 339 (2010)(quoting, Eu v. San Francisco County Democratic

Central Comm., 489 U.S. 214, 223 (1989), internal quotation marks and

citations omitted).

44. Payroll deduction is the most effective and efficient method for employees to

contribute to their unions’ Michigan SSFs, which is why the proponents of PA

269 selectively banned its use for that purpose.

45. Public Act 269 selectively prohibits the use of PAC check-off for union SSFs

while permitting its use for the SSFs of corporations.

46. By prohibiting PAC check-off for unions and their members, PA 269 will

interfere with and impair the right of Plaintiff unions and their members to



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engage in political speech and association protected by the First Amendment

to the U.S. Constitution.

47. The First Amendment prohibits the government from discriminating among

speakers, because speaker-selective government regulation of speech raises

the specter of viewpoint discrimination, that is, the favoring or disfavoring of

speech based on its content associated with the identity of the speaker.

48. Michigan can assert no compelling justification for selectively permitting

corporations to use payroll deduction for political fundraising and denying

that method to unions and their members. A selective speaker-based

regulation of speech without a sufficiently compelling justification is

presumptively invalid. There is no rational explanation – much less a

compelling justification – for the government’s selective discrimination

against unions and their members. The discriminatory suppression of

constitutionally protected speech and association effected by PA 269 serves

no legitimate government interest and constitutes invidious content-based

discrimination by the government.



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COUNT II

DEPRIVATION OF FIRST AMENDMENT RIGHTS IN VIOLATION OF

THE FOURTEENTH AMENDMENT TO THE U.S. CONSTITUTION:

UNJUSTIFIED GOVERNMENT SUPPRESSION OF POLITICAL

SPEEECH AND ASSOCIATION

49. The First Amendment protects the raising of funds to pay for speech and

advocacy.

50. The government may not enact laws that burden, inhibit or suppress political

speech and raising funds to finance political speech without sufficient

justification. “[P]olitical speech must prevail against laws that would suppress

it, whether by design or inadvertence. Laws that burden political speech are

subject to strict scrutiny, which requires the Government to prove that the

restriction furthers a compelling interest and is narrowly tailored to achieve

that interest.” Citizens United v. FEC , 558 U.S. 310, 340 (2010)(internal

quotation marks and citations omitted).

51. Public Act 269 does not survive strict scrutiny. There is no compelling

justification for prohibiting the long practice of payroll deduction of

employees’ contributions to their union’s SSF.

52.

Any asserted governmental concern regarding an in-kind contribution of a

corporate employer’s expenses of providing PAC check-off to a union’s SSF

is fully addressed by requiring reimbursement to the employer for those



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expenses. This approach has been endorsed by the Secretary of State in

interpretive rulings and it is specifically provided for in FEC regulations

applicable to federal SSFs. The legislature inexplicably forbade

reimbursement by the union’s SSF of an employer’s expense in amended

Section 54(3).

53. Public Act 269 violates the First Amendment rights of unions and their

members to engage in political speech and association.

COUNT III

VIOLATION OF THE EQUAL PROTECTION CLAUSE OF THE

FOURTEENTH AMENDMENT

54. As stated above, PA 269 selectively permits payroll deduction arrangements

only for corporations and not for other speakers, such as unions.

55. There is no rational basis for PA 269’s selective and discriminatory

application to certain speakers and not to others, particularly where the

fundamental right to advocate and participate in election campaigns is

affected.

56. Such selective and discriminatory treatment by the government violates the

Equal Protection Clause of the Fourteenth Amendment.



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COUNT IV

VIOLATION OF THE CONTRACT CLAUSE

OF THE U.S. CONSTITUTION

57.

The Contract Clause of the United States Constitution, Article 1, § 10, clause

1, provides in pertinent part that: “No State shall . . . Pass any . . . Law

impairing the Obligation of Contracts.”

58. Collective bargaining agreements entered into by Plaintiffs UWUA Local

223, IBEW Local 58, and MSUWC provide for PAC check-off by their

members so that they can voluntarily contribute a portion of their wages to the

Union’s SSF through payroll deduction.

59. As described above, Public Act 269 substantially impairs the Plaintiff

Unions’ collective bargaining agreements by making it a criminal offense for

corporate employers – who comprise the overwhelming majority of signatory

employers - to comply with the PAC check-off provision in those agreements.

Pubic Act 269 was given immediate effect, and unlike other legislation, PA

269 does not make an exception for collective bargaining agreements

currently in effect.

60.

Michigan does not have a significant or legitimate public purpose for

prohibiting performance of the PAC check-off agreements.



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RELIEF REQUESTED

Plaintiffs request that the Court:

A. Declare that enforcement of PA 269 violates the First Amendment to the U.S.

Constitution by suppressing and impairing political speech and association of

unions and their members without sufficient justification;

B. Declare that enforcement of PA 269 violates the First Amendment to the U.S.

Constitution by selectively and discriminatorily suppressing political speech

and associational activity by unions and their members while not so limiting

such activity by corporations, based on the government’s disagreement and

disfavoring of unions’ perceived viewpoints and political ideology;

C. Declare that enforcement of PA 269 violates the Equal Protection Clause of

the Fourteenth Amendment by selectively and discriminatorily suppressing

political speech and associational activity by unions and their members while

not so limiting such activity by corporations, without any rational basis for

doing so;

D. Declare that enforcement of PA 269 violates the Contract Clause of the U.S.

Constitution by substantially impairing agreements between unions and

employers for PAC check-off, without a significant and legitimate public

purpose;



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E. Issue a temporary restraining order, and preliminary and permanent

injunctions, enjoining Defendants, their agents, and those acting in concert or

cooperation with them, from taking any action to implement or enforce the

prohibition of payroll deduction under PA 269 as described in this Complaint;

F. Order Defendants to reimburse Plaintiffs for their reasonable attorneys fees

and costs in bringing this action, pursuant to 42 U.S.C. § 1988; and

G. Grant such other relief as the Court deems just.

Respectfully submitted,

s/Andrew Nickelhoff

Andrew Nickelhoff (P37990)Marshall J. Widick (P53942)Sachs Waldman, P.C.Attorneys for Plaintiffs Michigan State AFL-CIO,Michigan State Utility Workers Council, andWilliam D. Chadwick, Jr.2211 E. Jefferson Ave, Ste. 200Detroit, MI 48207-4160(313) [email protected]

/s/ John R. Canzano

John R. Canzano (P30417)McKnight Canzano Smith Radtke & Brault P.C.Attorneys for UWUA Local 223 andGeorge Horuczi

423 N. Main St., Ste. 200Royal Oak, MI 48067-1884(248) 354-9650

[email protected]


mailto:[email protected]:[email protected]:[email protected]


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/s/ Robert D. Fetter

Robert D. Fetter (P68816)Miller Cohen PLCAttorneys for IBEW Local 58600 W. Lafayette Blvd., Fl. 4

Detroit, MI 48226-2711(313) [email protected]

Dated: April 22, 2016

mailto:[email protected]:[email protected]

complaint - mi v. johnson

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