In Utter v. BIAW, No. 89462-1, the Washington Supreme Court reinstated the lawsuit by two retired Justices against the Building Industry Association of Washington. The lawsuit alleged that BIAW violated the Washington’s Fair Campaign Practices Act (FCPA), by failing to register as a political committee during the 2007-2008 Gubernatorial campaign. BIAW, a non-profit, formed the for-profit BIAW Member Services Corporation (BIAW-MSC), which administered a program whereby its members pooled their industrial insurance risks and obtained refunds. In 2007, BIAW or BIAW-MSC asked their members to pledge their refunds to Dino Rossi’s campaign for governor.
The Plaintiffs reported this potential FCPA violation to the Attorney General (AG), who referred the matter to the Public Disclosure Commission (PDC) for investigation. The PDC concluded that BIAW was not a political committee but that BIAW-MSC may have been, and sued BIAW-MSC, which settled. The plaintiffs then brought a “citizen action” against BIAW. A citizen action is authorized when AG receives a written notice of the alleged FCPA violation but “fails to commence an action.” RCW 42.17A.765(4)(a)(i). The trial court dismissed the suit, and the Court of Appeals affirmed.
The Supreme Court reversed, holding that the PDC investigation against BIAW did not preclude a citizen suit. The court broadly defined “political committees” subject to the FCPA reporting requirements to include entities with “a primary purpose” of advancing electoral goals. The court then concluded that plaintiffs raised an issue of material fact as to whether BIAW met this test, refusing to defer to the PDC’s conclusion that BIAW-MSC, not BIAW, expended money towards electoral goals.