Back to Open Road enewsletter

Auto Dealers and Public Win at the Statehouse…and the Courthouse
By CAR lobbyist Jeremy Cottrell

The cheers could be almost heard throughout the Rocky Mountains, as Denver District Judge Christina Habas issued her decision in the litigation ruling against Amendment 41. The case brought by the First Amendment Council against Gov. Ritter as the representative of Colorado concerned the constitutionality of Amendment 41.

The Habas decision, handed down about two weeks after the hearing in Denver District Court, was one that directly affects one in four Coloradans and indirectly affects all citizens and business owners. Named plaintiffs were numerous, and some were prominent. The list of 12 included:  Anne McGihon, Colorado State Representative; Danny Williams, lobbyist; David Getches, dean of University of Colorado College of Law, as well as several others.  

Judge Habas issued a temporary injunction on the gift ban provision of Amendment 41, meaning that its effect is temporarily enjoined (suspended). The rationale for her decision came in nearly perfect poetic form of a “41-page” ruling. Within the ruling Habas cited several main tenants of law in support of the decision.

1. The Government did not present any countering testimony that would rebut the testimony of the witnesses called by the Plaintiffs.
   1. In fact, the plaintiffs compiled testimony from nearly fifteen witnesses while the state called none. Each witness provided a unique distinct hardship caused by over-reaching and illogical effects of Amendment 41. The state countered the testimony by citing fears were speculative or unfounded. Judge Habas disagreed, “I find that the plaintiffs’ fears are well-founded, and that their speech, association and petitioning rights have been chilled.”

2. The loss of First Amendment rights, even for a minimal period of time, constitutes irreparable injury.
   1. One basic premise upon which the First Amendment Council relied was the effect it had on freedom of speech, association, and intrusion into peoples’ personal lives. Amendment 41’s adverse, vague, and widespread effect directly compromised constitutional rights. Any deprivation of the freedom of speech must pass the most onerous of tests and strict scrutiny. In essence, a law that violates a protected interest must survive only if the state can prove that the law is necessary to achieve a compelling government interest and no less burdensome alternatives are available.

3. The fact that 62 percent of voters approved Amendment 41 is immaterial.
   1. “On its own, this does not provide a compelling or sufficient governmental purpose that justifies the abridgement of First Amendment rights. A thorough and detailed review of the language of Amendment 41 shows the largely unexpected and unintended consequences of the Amendment and best serves the public interest in upholding the constitutional guarantees under the First Amendment, and ensuring that elected officials and government employees are well-informed, and able to freely communicate with all of their constituents.”  Ironically, the reliance and repeated statistical data by the state’s defense was not supported by a single person brought forth to testify who voted for Amendment 41 in November 2006.  The defense team is currently pleased and feels that its actual effect is reasonable, and the title was fully informative of all of the subject matter involved.

Clearly, the “reach of Amendment 41 went well beyond what was anticipated or intended, based upon what even the Government concedes to be the ambiguous language of the Amendment.”

While this injunction is a significant victory for most Coloradans, Common Cause still stubbornly stands by its fallen Amendment by citing that those opposing it simply do not understand it. Ironically, that’s the very premise of the underlying flaw of Amendment 41-it cannot be interpreted by spirit or by plain language and not lead to atrocious consequences. Judge Habas found the plain language to be vague and overbroad as applied to millions of affected Coloradans.

How will this affect you as a dealer?

This decision is not yet final, as it will get an automatic appeal to the state supreme court. Realistically, it will be at least three or four months before Amendment 41 is heard in the courts on appeal.

In the meantime, the gift ban provisions of Amendment 41 are blocked and will not be in effect unless and until the Colorado Supreme Court hears and overturns the ruling form the lower court. This means dealers can offer dealer incentives, manufacturer rebates, negotiate financing terms on loans, offer the use of vehicles for civic functions (parades) as well as state schools and universities, and donate freely to organizations in the form of money or products (baseball uniforms), as well as provide open invitations to company events (summer BBQs, holiday parties).

In other words, it is like being back in the good old days!