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Adams v. Maine Municipal Association

Superior Court of Maine, Cumberland

December 15, 2014

MARY ADAMS, et al., Plaintiffs,




Before the court are cross-motions for summary judgment on Counts V and VI of (he Plaintiffs' First Amended Complaint ("Amended Complaint"). Plaintiffs, Mary Adams, John H. Wibby, Jr., Pembroke Schaffer ("Individual Plaintiffs") and Cyr Plantation (collectively "Plaintiffs") allege that there arc no genuine issues of material fact and Plaintiffs are entitled to judgment as a matter of law. Count V alleges the Defendant's contribution to and participation in Political Action Committees ("PACs") constitutes the illegal expenditure of public money for partisan political purposes in the absence of statutory authority. (Pls.' Compl. ¶ 24.) Count VI is asserted by MMA municipal member, Cyr Plantation, and alleges that the Defendant's partisan and political activities are ultra vires and violate clear restrictions in its corporate charter. As to both Counts, Plaintiffs seek relief in the form of a permanent injunction.


The parties have stipulated to the facts. Below is a brief summary of the action before the court.

a. MMA as an Entity in the State of Maine

Defendant, Maine Municipal Association ("MMA") is a non-profit, non-partisan organization formed in 1936 as an unincorporated association to advance the collective interests of Maine's local governments. (Joint Stip., ¶¶ 1, 4, ) MMA was incorporated in 1952 pursuant to what was then Chapter 50 of the Maine Revised Statutes, entitled "Corporations Without Capital Stock. (Joint Slip., ¶ 2.) While MMA is organized as a "private corporation without stock, " as an instrumentality, MMA uses local government tax exemptions and government accounting standards, participates in the Maine Public Employees Retirement System, and is j subject to some aspects of the Maine Freedom of Access Act, 1 M.R.S §§ 401-521.

MMA is a voluntary membership organization, with varying membership levels for: (1) municipalities and other local governments; (2) counties and quasi-municipal corporations; (3) municipal associations and professional organizations; and (4) individuals, students, professionals, and businesses, hi While MMA membership is voluntary, from 2002-2009, nearly 100% of Maine municipalities were members. (Joint Stip., ¶ 7.) MMA provides educational, informational, and professional services to municipal members including training, manuals, online resources, publications, legal resources etc. (Joint Stip., ¶ 2.) MMA derives its revenue from dues, sales of publications, exhibitors at annual conventions, contract services, and other fee-based services and programs. (Joint Stip., 6.)

The MMA has adopted a local government tax exemption pursuant to 26 U.S.C Section 115, and all of its income, regardless of source, is excluded from gross income. Thus, the MMA pays no taxes. (Joint Slip., ¶ 8.) The MMA maintains a "general fund" into which most revenue is deposited with transfers to "designated funds" being made at the discretion of (he Executive Committee. (Joint Stip., ¶ 6.)

b. MMA as an Advocate for Maine's Municipalities

MMA is an advocate in support of or against proposed legislation that affects Maine Municipalities. (Joint Stip., ¶14.) The MMA maintains a 70-member Legislative Policy Committee (the "LPC") from each of Maine's state senate districts to provide legislative analysis and to determine the MMA's position on legislation of all types.[1] (Joint Stip., ¶ 4.) The LPC analyzes proposed legislation and ballot measures affecting municipal governments.[2] Id. MMA further maintains a Legislative Initiative Fund ("LIF"), which is funded at the Executive Committee's discretion by allocations from MMA's general fund.

c. The Plaintiffs

The Plaintiffs to this action are residents of and property tax payers in the towns of Garland, Gray, and Brunswick, Maine. All of which are MMA municipal members. (Joint Stip., 7.) In addition to membership dues, each town also purchases insurance products from MMA. Id. Individual plaintiffs promoted the below-mentioned Citizens Initiatives. However, in part because of MMA's opposition, voters ultimately rejected the Initiatives. The individual Plaintiffs' tax monies are alleged to have gone to MMA both through the dues paid by the towns, and through premiums paid on the insurance procured by the towns. Id. Each Plaintiff is a registered voter who voted in each of the disputed Initiatives discussed below. Further, all three individual Plaintiffs were signatories to the "Maine Taxpayer Bill of Rights" Initiative which was presented on a statewide ballot in 2006. MMA opposed this Initiative.

Plaintiff Cyr Plantation is a Maine plantation and an MMA member, Beginning in 2005, Cyr Plantation complained to MMA about its lobbying activities that affected the Plantation.

d The Initiatives

Between 2003 and 2009, MMA advocated against five (5) Citizen Initiatives arising under Article IV, Part Third, Section 18 of the Maine Constitution. (Pis, ' Stip. Fact, 16.) MMA coordinated with other interest groups in organizing or managing the PACs and the campaign to support or oppose. MMA also provided staff support, including personnel in leadership roles, These Initiatives included; (1) the School Finance and Tax Reform Act of 2003 ("55% School Funding Initiative); (2) An Act to Impose Limits on Real and Personal Property Taxes in 2004 ("Palesky Initiative"); (3) An Act to Create a Maine Taxpayer Bill of Rights in 2006 ("TABOR I"); (4) An Act to Provide Tax Relief in 2009 ("TABOR II"); and (5) An Act to Decrease the Automobile Excise Tax and Promote Energy Efficiency in 2009 (the "Excise Tax Initiative"), (Def.'s Stip. Fact, 30.) Each of the Initiatives was related to municipal issues including taxing and spending. In the case of each of the above-mentioned Initiatives, the Committee determined that the MMA should take a position. (Def's Stip. Fact, ¶¶ 32, 38, 48, 58, 60.)


In a motion for summary judgment, the Court views the evidence in the light most favorable to the nonmoving party to decide whether the parties' statements of material facts and the referenced record material) reveal a genuine issue of material fact. Rogers v, Jackson, 2002 ME 140, 5, 804 A.2d 379 (citations omitted). The court gives the party opposing summary judgment the benefit of any inferences that might reasonably be drawn from the facts presented. Curtis v. Porter, 2001 ME 158, 9, 784 A.2d 18. If the record reveals no genuine issue of material fact then summary judgment is proper. Id., at 6, 784 A.2d at 21.

A contested fact is "material" if it could potentially affect the outcome of the suit under the governing law. Inkel v. Livingston, 2005 ME 42, 4, 869 A.2d 745. A fact is "genuine" if there is sufficient evidence supporting the claimed fact to require a fact-finder to choose between competing versions of facts at trial, hi For the purposes of summary judgment, factual disputes and ambiguities must be resolved against the movant. Nevertheless, when the facts offered by a party in opposition to summary judgment would not, if offered at trial, be sufficient to withstand a motion for judgment as a matter of law, summary judgment should be granted. See Rodrigue v. Rodrigue, 1997 MB 99, 8, 694 A.2d 924; see also Stanton v. Univ. of Maine Sys, 2001 ME 96, 6, 773 A.2d 1045 ("To survive a . .. motion for summary judgment, a plaintiff must produce evidence that, if produced at trial, would be sufficient to resist a motion for a judgment as a matter of law, "). A defendant moving for summary judgment has the burden to assert those [ elements of the cause of action for which the defendant contends there is no genuine issue to be tried.


A. Count V; MMA's Expenditure of Public ...

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