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PLAINTIFFS’
MEMORANDUM OF POINTS AND AUTHORITIES
IN
OPPOSITION TO DEFENDANTS’ MOTION TO DISMISS
Plaintiffs,
the People of the State of California, ex rel., Carol Spooner,
John D. Biello, Carolyn Birden, Kurt Guerdrum, Arturo Griffifths,
Amburn R. Hague, Leigh Hauter, Patricia Heffley, Barbara MacQuiddy,
Rick Potthoff, Charles P.H. Scurich, Ronald Swart, individually
and on behalf of Pacifica Foundation, oppose moving defendants’
motion to dismiss the action on the grounds that this Court has
no subject matter jurisdiction over this case.
I. PLAINTIFFS’
CLAIMS ARE NOT PREEMPTED BY FEDERAL LAW,
AND THIS COURT HAS NO SUBJECT MATTER JURISDICTION IN
THIS CASE.
Plaintiffs
fully incorporate herein by this reference their Motion for Remand
and their Memorandum of Points and Authorities in Support their
Motion for Remand, filed October 26, 2000.
II. DEFENDANTS’
FUNDAMENTALLY MISCONSTRUE THE COMPLAINT.
Moving defendants fundamentally
misconstrue the complaint brought against them. They have confounded
their obligations as holders of broadcast licenses under the Federal
Communications Act – to use those broadcast licenses in the public
interest -- with their obligations under the California Nonprofit
Corporations Law – to use those broadcast licenses for the purposes
set forth in the Articles of Incorporation of the Pacifica Foundation.
The Pacifica
Foundation Articles of Incorporation have, since amendments filed
with the California Secretary of State on August 20, 1949, stated
the purposes of Pacifica, at Article II, as follows:
"That
the purpose of this corporation shall be:
(a) To
establish a Foundation organized and operated exclusively
for educational purposes no part of the net earnings of which
inures to the benefit of any member of the Foundation, and
no substantial part of the activities of which is designed
to carry on propaganda or otherwise attempt to influence legislation.
(b) To
establish and operate for educational purposes, in such manner
that the facilities involved shall be as nearly self-sustaining
as possible, one or more radio broadcasting stations licensed
by the Federal Communications Commission and subject in their
operation to the regulatory actions of the Commission under
the Communications Act of 1934, As Amended.
(c) In
radio broadcasting operations to encourage and provide outlets
for the creative skills and energies of the community; to
conduct classes and workshops in writing and producing of
drama; to establish awards and scholarships for creative writing;
to offer performance facilities to amateur instrumentalists,
choral groups, orchestral groups and music students; and to
promote and aid other creative activities which will serve
the cultural welfare of the community.
(d) In
radio broadcasting operations to engage in any activity that
shall contribute to a lasting understanding between nations
and between the individuals of all nations, races, creeds
and colors; to gather and disseminate information on the causes
of conflict between any and all of such groups; and through
any and all means compatible with the purposes of this corporation,
to promote the study of political and economic problems and
the causes of religious, philosophical and racial antagonisms.
(e) In
radio broadcasting operations to promote the full distribution
of public information; to obtain access to sources of news
not commonly brought together in the same medium; and to employ
such varied sources in the public presentation of accurate,
objective, comprehensive news on all matters vitally affecting
the community."
Complaint,
Paragraph 18.
The Complaint
does not allege that defendants are not using their broadcast
licenses in the public interest, and therefore makes no challenge
that comes under the jurisdiction of the Federal Communications
Commission ("FCC"). Defendants may well meet all of
their public interest obligations under the Federal Communications
Act and still breach their trust under the California Nonprofit
Corporations Law.
Plaintiffs
reiterate here that there is nothing in the Public Broadcasting
Act that compels Pacifica to apply for or to accept grants from
the Corporation for Public Broadcasting if doing so requires a
breach of the Pacifica trust or a change in Pacifica’s governance
structure or the voting rights of Pacifica’s corporate members.
In fact, the purposes set forth in Pacifica’s Articles of Incorporation,
and, particularly at section (b), to be as nearly self-sustaining
as possible, require rejection of any federal funding that
would meddle with Pacifica’s program content and the rights of
its members.
For nearly
50 years Pacifica conformed to its trust purposes, and the FCC
renewed its broadcast licenses periodically over the years. In
fact, Pacifica once was in the forefront of development of First
Amendment law with regard to broadcasters under the Federal Communications
Act, FCC v. Pacifica Foundation, 438 U.S. 726 (1978) (indecency),
and under the Public Broadcasting Act, FCC v. League of Women
Voters of California, et al., 468 U.S. 364 (1984) (right of
noncommercial educational broadcasters to editorialize). But none
of those weighty Constitutional issues are before this Court today.
The issues
raised in this case are governed by the California Nonprofit Corporation
Law (California Corporations Code §5000, et seq.), the California
Uniform Supervision of Trustees for Charitable Purposes Act (California
Government Code §12580, et seq.), and the California Unfair Competition
Law (California Business & Professions Code §17200, et seq.),
and are not preempted by the Federal Communications Act (47 U.S.C.
§301, et seq.) or the Public Broadcasting Act (47 U.S.C. §390,
et seq.).
Under California
law, nonprofit public benefit corporations are deemed to be impressed
with a charitable trust by virtue of the express declaration of
the corporation’s purposes in its articles of incorporation. Pacific
Home v. County of Los Angeles, 41 Cal. 2d 844, 852 (1953).
The California Supreme Court established nearly forty years ago,
in Holt v College of Osteopathic Physicians & Surgeons,
61 Cal. 2d 750 (1961), that the issue of breach of charitable
trust does not turn on whether the public interest is served by
the actions of the charitable trustees. The sole issue is: Are
the charitable trustees using the assets held in trust for the
purposes for which the trust was established?
In
Holt, the plaintiffs were three trustees of the College of
Osteopathic Physicians & Surgeons ("COPS") and the
defendants were the other 23 trustees, the California Attorney General,
and COPS, itself, as nominal defendant. The defendant trustees proposed
to change the nature of COPS from teaching osteopathic medicine
to teaching allopathic medicine. The plaintiff trustees sought to
enjoin such action, as well as a declaration of the rights and duties
of the parties with regard to COPS. The California Attorney General
filed an answer to the complaint asserting as an affirmative defense
that:
"The
matter of proposed changes in the operation of said College
was reviewed by the Attorney General to determine whether
such changes would constitute a violation of a charitable
trust warranting institution of a suit by this office to remedy
the situation. It has been concluded that the changes to be
made in the operation of said College would not be detrimental
to the public interest and do not warrant legal action by
this office to prevent such changes."
The
Holt court held:
"The
test applied by the Attorney General in deciding not to take
legal action is clearly incorrect, for the assets of COPS
as a charitable institution can be used only for the purposes
for which they were received in trust. The trust is not fulfilled
merely by applying the assets in the public interest."
Id.
at p. 755.
Likewise,
in the present case, the directors of the Pacifica Foundation
may satisfy the FCC that they are using their broadcast licenses
in the public interest. That is not the issue. The fact that the
current directors now diverge from Pacifica’s express trust purposes
without incurring the opprobrium of the FCC is neither here nor
there. The trust is not fulfilled merely by applying those licenses
in the public interest, they must be used only for the purposes
for which they were received in trust. And, so long as the trust
purposes do not conflict with the public interest, that is not
a matter that concerns the FCC or comes under its jurisdiction.
Finally, the Holt court concluded:
"The
purpose of COPS nevertheless is to conduct an osteopathic
college, and, if the allegations of the complaint are true,
the teaching of allopathic medicine is proper only insofar
as is useful in the training of osteopaths. [...] Whether
the teaching of allopathic medicine as threatened by defendant
trustees will change the teaching emphasis at COPS contrary
to the charitable purpose of conducting an osteopathic college
presents a question of fact that cannot be decided on demurrer."
Id. at
p. 760.
In the present
case, whether the decision of the defendant Pacifica officers
and directors to bow to political pressure from the Corporation
for Public Broadcasting ("CPB") and others, and to alter
the content of Pacifica’s programming in order to receive federal
funding through the CPB, as alleged in the complaint, has changed
the programming emphasis at Pacifica contrary to the purposes
set forth in the Articles of Incorporation, particularly --
to
encourage and provide outlets for the creative skills and
energies of the community ... to engage in any activity
that shall contribute to a lasting understanding between nations
and between the individuals of all nations, races, creeds
and colors; to gather and disseminate information on the causes
of conflict between any and all of such groups ... to promote
the study of political and economic problems and the causes
of religious, philosophical and racial antagonisms ... to
promote the full distribution of public information; to obtain
access to sources of news not commonly brought together in
the same medium; and to employ such varied sources in the
public presentation of accurate, objective, comprehensive
news on all matters vitally affecting the community --
presents
a question of fact that cannot be decided on a motion to dismiss
under Rule 12(b)(6), and that may not be decided by this Court
which lacks subject matter jurisdiction even to rule on the motion.
III.
AS THIS COURT HAS NO SUBJECT MATTER JURISDICTION IN
THIS CASE, THE ISSUES RAISED BY MOVING DEFENDANTS
MUST BE DECIDED BY THE STATE COURT.
Moving defendants’
objections to plaintiffs’ standing as relators, and the remainder
of their objections to the Complaint, all are matters of state
law. As there is no federal question raised in the Complaint,
this Court must leave those issues to the California court to
decide.
CONCLUSION.
For the foregoing reasons, plaintiffs respectfully request this Court to decline to rule on
moving defendants’ motion to dismiss and, instead, to remand the case to the state court as
prayed for in plaintiffs Motion to Remand (with Costs incurred as a result of the removal)
previously filed with the Court.
Date: ______________
Respectfully submitted,
________________________________________
DANIEL ROBERT BARTLEYAttorney for Plaintiffs
The People of the State of California, ex rel.,
Carol Spooner, John D. Biello, Carolyn
Birden, Kurt Guerdrum, Arturo Griffifths,
Amburn R. Hague, Leigh Hauter, Patricia
Heffley, Barbara MacQuiddy, Rick Potthoff,
Charles P.H. Scurich, Ronald Swart,
individually and on behalf of Pacifica
Foundation
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