ARIZONA SUPREME COURT
JAIME A. MOLERA, an
individual and qualified elector;
ARIZONANS FOR GREAT
SCHOOLS AND A STRONG
ECONOMY, a political action
committee,

)
)
)
)
)
)
)
Plaintiffs/Appellees/Cross)
Appellants,
)
)
v.
)
)
KATIE HOBBS, in her official
)
capacity as Arizona Secretary of
)
State; INVEST IN EDUCATION
)
(SPONSORED BY AEA AND
)
STAND FOR CHILDREN), a
)
political action committee,
)
Defendants/Appellant/Cross- )
)
Appellee.
)

No. CV-20-0213-AP/EL
Maricopa County Superior Court
No. CV2020-007964

OPENING BRIEF OF APPELLANT INVEST IN EDUCATION
(SPONSORED BY AEA AND STAND FOR CHILDREN)
Roopali H. Desai (024295)
rdesai@cblawyers.com
D. Andrew Gaona (028414)
agaona@cblawyers.com
Marvin C. Ruth (024220)
mruth@cblawyers.com
Kristen Yost (034052)
kyost@cblawyers.com
COPPERSMITH BROCKELMAN PLC
2800 North Central Avenue, Suite 1900
Phoenix, Arizona 85004
T: (602) 381-5478
Attorneys for Defendant/Appellant/CrossAppellee Invest in Education (Sponsored by
AEA and Stand for Children)
{00508053.4 }

 Introduction
¶1

Arizonans’ right to legislate by initiative is fundamental. Or

at least it once was. Decades of increased regulation by the Legislature
has limited that right and transformed its exercise into a difficult,
expensive, and litigious process that frequently leads to disqualification
before ballot access. And though courts historically protected this right,
they now serve as challengers’ primary tool against it. Appellant
(“Committee”) knows this well; for the second time in as many years, the
fate of its attempt to ask Arizonans to provide funding to public schools
is in this Court’s hands.
¶2

Two years ago, this Court decided Molera v. Reagan, 245 Ariz.

291 (2018), and for the first time in its history, removed an initiative
measure (the Committee’s) from the ballot for violating A.R.S. § 19102(A). That decision was an outlier: the exception rather than the rule.
But it opened a Pandora’s Box, as each of the four statewide initiatives
that submitted petitions to the Secretary of State this year is the subject
of a challenge to its 100-word description.
¶3

Emboldened by Molera, Appellees (“Challengers”) – supported

by the Arizona Chamber of Commerce – brought this case against the

{00508053.4 }

-1-

 Invest in Education Act (“Initiative”), again challenging its 100-word
description (“Description”), as well as how a vendor paid petition
circulators. Their challenges to the Description are nothing like those in
Molera, and instead parrot policy arguments that belong on an editorial
page.
¶4

Rather than recognize Molera’s limitations and the stark

differences between its facts and those before it, the trial court agreed
with Challengers on nearly every point. It misapplied Molera to hold that
the Description omitted five “principal provisions” of the Initiative (in a
discussion itself totaling 127 words) and misled voters by accurately
using the term “surcharge” to describe the Initiative’s surcharge. Even
worse, it did so in a 20-page order capped off by gratuitous and insulting
rhetoric aimed at the Committee that could be part of a press release
written by the Chamber itself.
¶5

The result, if not overturned, would be an unconstitutional

and untenable new standard under A.R.S. § 19-102(A): (1) an initiative’s
“principal provisions” are whatever a challenger can imagine, (2)
initiative proponents must limit themselves to simple laws able to be
fully described in 100 words or less, and (3) even then, proponents’

{00508053.4 }

-2-

 descriptions must use language preferred by their opponents in a
quintessential example of compelled speech. It is an impossible standard
to meet, and conflicts with article IV, pt. 1, § 1 of the Arizona Constitution
(“Article IV”) and the First Amendment.
¶6

The trial court erred in its restrictive application of A.R.S.

§ 19-102(A) and Molera. It erred in its construction of A.R.S. § 19118.01(A) as applied to incentive programs used by the Committee’s
vendor. And it erred by engaging in a speculative attempt to account for
Challengers’ failure to carry their burden of proof by linking petition
signatures with payments in violation of A.R.S. § 19-118.01(A).
¶7

This case calls an important question about the Arizona

Constitution: do Arizonans still have “as great as the power of the
Legislature to legislate,” State v. Osborn, 16 Ariz. 247, 250 (1914), as the
framers intended? Because the answer to that question must be “yes,”
this Court should reverse the judgment below and allow Arizonans the
chance to vote up or down on the Initiative.
Statement of the Case & Statement of Facts
¶8

In February, the Committee obtained a serial number for the

Initiative. [APP1-018] The Description on the Initiative’s petitions reads:

{00508053.4 }

-3-

 The Invest in Education Act provides additional funding for
public education by establishing a 3.5% surcharge on taxable
income above $250,000 annually for single persons or married
persons filing separately, and on taxable income above
$500,000 annually for married persons filing jointly or head
of household filers; dedicates additional revenue to (a) hire
and increase salaries for teachers, classroom support
personnel and student support services personnel, (b)
mentoring and retention programs for new classroom
teachers, (c) career training and post-secondary preparation
programs, (d) Arizona Teachers Academy; amends the
Arizona Teachers Academy statute; requires annual
accounting of additional revenue.
¶9

The Committee hired AZ Petition Partners, LLC (“AZPP”) to

collect signatures. [APP1-034-40] AZPP paid circulators based on the
number of hours they worked, not based on the number of signatures they
collected. [APP3-108-116] It set employees’ hourly rates prospectively
based on several factors, including performance, effort, and compliance
with a “Code of Conduct.” [Id.] In addition, some circulators earned
bonuses, but never for collecting a certain number of signatures. [APP3117-122]
¶10

The Committee submitted 435,669 petition signatures to the

Secretary of State. [APP3-207] Challengers filed their Verified
Complaint, requesting that the Court enjoin the Initiative from
appearing on the ballot because (1) the Description violated A.R.S. § 19-

{00508053.4 }

-4-

 102(A), and (2) petition circulators for the Initiative received payments
in violation of A.R.S. § 19-118.01(A).
¶11

The trial court permitted Plaintiffs to conduct discovery,

including of AZPP. [APP1-003-04] The Committee sought summary
judgment on Challengers’ claims [APP1-008]; Challengers moved for
summary judgment only on the Description. [Id.]
¶12

The trial court largely denied both parties’ motions. [APP1-

012] It insisted that the “legal standard established in Molera is an
objective, fact-intensive standard.” [APP1-009] And it found a fact issue
“as to which ‘paid circulators’ may have obtained signatures in violation
of A.R.S. § 19-118.01(A),” meaning that “the number of signatures that
may be counted, and the number of signatures which may be in question,
cannot be determined as a matter of law.” [APP1-015]
¶13

A three-day bench trial followed. Regarding circulator

compensation, the parties presented the following relevant evidence:
¶14

“Weekend Warriors”: Challengers introduced a post in

AZPP’s employee application (“App”) advertising that employees were
eligible for this bonus if they (1) worked at least 5 hours each day of the
weekend, and (2) maintained a minimum productivity expectation of 3

{00508053.4 }

-5-

 “sets” per hour.1 [APP1-029] AZPP’s owner, Andrew Chavez, and one of
its managers, Tom Bilsten, testified that the minimum productivity
requirement allowed AZPP to deny the bonus to employees who failed to
perform their job (collect signatures). [APP3-099-100, 121] Challengers
called one circulator, Colby Jensen, at trial and admitted his pay stubs
into evidence. Besides Mr. Jensen, Challengers presented no other
circulators’ pay stubs or testimony to establish that AZPP paid any
bonuses. Challengers also failed to present evidence that any circulators
(including Mr. Jensen) submitted signatures for the Initiative.
¶15

“Productivity Winners”: Challengers introduced an App post

announcing one week’s four “Productivity Winners.” [APP1-033] Mr.
Chavez testified that these employees “were never paid” a bonus. [APP3128-30] Challengers obtained their paystubs through discovery but never
introduced them at trial. Challengers also failed to establish that the four
employees submitted petitions for the Initiative.

A “set” means a circulator persuades one voter to sign all initiative
measures the circulator is carrying. Thus, if a voter signs all initiatives
the circulator is circulating, that is considered one “set.” If a circulator
collected 100 signatures for one measure, and one signature for two other
measures the circulator is carrying, that is still only one “set.” [APP3106-07]
1

{00508053.4 }

-6-

 ¶16

“Show Me the Money” Raffle: Challengers introduced a flyer

advertising a raffle where employees could earn “tickets” for turning in
sets between January 1, 2020 and February 29, 2020. [APP1-041] Mr.
Bilsten, who managed all bonus programs, testified that “Invest in Ed
was not part of this program.” [APP3-088-89] AZPP’s Phoenix office
started circulating petitions for the Initiative on February 17, but was
unable to distribute petitions to its other offices. [APP3-088-89, 125]
AZPP thus did not include the Initiative in the “sets” that made
circulators eligible for raffle tickets. [Id.] Plaintiffs did not establish that
any raffle winners submitted petitions for the Initiative.
¶17

“Du[e]l for the Dollars”: Challengers introduced an App post

advertising “a competition where two circulators du[e]l head to head and
see who can collect more signatures during the week.” [APP1-030-32] AZPP
implemented this program for two weeks. [APP3-101-03] Of the $3,900,000
AZPP spent on payroll for its circulators while it was circulating petitions
for the Initiative, it spent $3,380 (or less than one-tenth of 1%) on these
bonuses. [APP3-126-27] Again, Challengers presented no evidence to show
which circulators’ pay stubs reflect this bonus, nor did they present any
evidence that any winners submitted petitions for the Initiative.

{00508053.4 }

-7-

 ¶18

At no point during Challengers’ case did they try to identify

which circulators’ petitions were at issue and which specific petition
signatures the trial court should invalidate based on alleged violations of
A.R.S. § 19-118.01. Despite the Court’s specific guidance that “the
number of signatures which may be in question” was a fact issue,
Challengers did not mark the Initiative’s petition sheets as a trial exhibit
and did not try to introduce them belatedly during trial.
¶19

The second half of the trial focused on Challengers’ 100-word

summary claims. Although the trial court insisted that it must engage in
a fact-intensive inquiry regarding Challengers’ claims, its ruling is devoid
of any reference to the record relating to these claims. This may be because
Challengers’ witnesses couldn’t support Challengers’ assertions. By
contrast, the Committee’s witnesses established that (1) it was accurate
for the Description to use the word “surcharge,” (2) the surcharge does not
apply to “small businesses” and it would have been inaccurate to call out
“business income,” and (3) the Initiative’s “no supplant” and “local
revenues” provisions are non-controversial and already embedded in other
parts of Arizona law. [APP3-163-69, 170-76, 178-79-81]

{00508053.4 }

-8-

 ¶20

At the close of Challengers’ case, the trial court denied the

Committee’s motion for judgment on partial findings on both of
Challengers’ claims under Rule 52(c), Ariz. R. Civ. P. [APP3-159-60]
¶21

The trial court then entered judgment against the Committee

in a 20-page order. [APP3-202] It held that the Description violated
A.R.S. § 19-102(A) by omitting five separate provisions of the Initiative.
The trial court also held that the use of the term “surcharge” created a
“substantial likelihood of confusion.”
¶22

On Challengers’ claim regarding circulator compensation, the

trial court held that the four incentive programs detailed above violated
A.R.S. § 19-118.01 by providing circulators “the opportunity to earn
something of value, above and beyond their hourly salary, based in part
on the number of signatures gathered.” [APP3-193-94]. The trial court
noted that “Plaintiffs ha[d] the burden to prove which signatures are
invalid because paid circulators had their compensation linked to the
number of signatures obtained.” [APP3-195] Ultimately, the trial court
held that “Plaintiffs . . . failed to prove their second claim of illegality –
namely, that there were an insufficient number of valid signatures filed
in support of the Initiative.” [APP3-199]

{00508053.4 }

-9-

 This appeal followed. This Court has jurisdiction under A.R.S.

¶23

§ 19-122 and Rule 10, Ariz. R. Civ. App. P.
Statement of Issues
This appeal raises five issues:

¶24
1.

Does the Description comply with A.R.S. § 19-102(A)?

2.

Does the trial court’s requirement that the Description
include five other principal provisions constitute compelled
speech or an undue burden on the Committee’s First
Amendment or Article IV rights?

3.

Did the trial court err in holding that “providing any benefit
to a petition circulator that hinges on the circulator’s
gathering of signatures” and payment to circulators based “in
part” on the number of signatures collected violates A.R.S.
§ 19-118.01?

4.

Does it violate A.R.S. § 19-118.01 for a petition circulating
company to advertise or implement a bonus program that
considers productivity, among other eligibility factors?

5.

Does the trial court’s broad interpretation of A.R.S. § 19118.01 violate the First Amendment or Article IV?

{00508053.4 }

- 10 -

 Argument
I.

The Description Complied with A.R.S. § 19-102(A)

¶25

The Description summarized all the Initiative’s principal

provisions, and did not create a “substantial danger of confusion” by its
accurate use of the word “surcharge” to describe the Initiative’s
surcharge.
¶26

A.R.S. § 19-102(A) requires that initiative proponents provide

“a description of no more than one hundred words of the principal
provisions of the proposed measure.” This “description need not be
impartial . . . [n]or must the description detail every provision.” Molera,
245 Ariz. at 295 ¶ 13 (citations omitted). In other words, the statute does
not require a “complete” description; instead, the summary cannot
misrepresent or conceal “the thrust of the measure.” Wilhelm v. Brewer,
219 Ariz. 45, 48 ¶ 13 (2008). It’s also relevant that an initiative’s sponsor
has only 100 words to describe what are often complex changes to law.
Cf. Quality Educ. & Jobs Supporting I-16-2012 v. Bennett, 231 Ariz. 206,
208 ¶ 9 (2013) (“[t]he length and complexity of the initiative, and the
[word limit] constraints prescribed in § 19-125(D), are factors in
assessing compliance”).

{00508053.4 }

- 11 -

 ¶27

The required description may “describe[] the intended effects

of the measure in a way that might appeal to prospective voters.” Save
Our Vote, Opposing C-03-2012 v. Bennett, 231 Ariz. 145, 152 ¶ 28 (2013).
And because the petition form states that the summary is “prepared by
the sponsor of the measure,” potential signers of the petition are “warned
that the summary description may not be complete or unbiased.”
Wilhelm, 219 Ariz. at 48 ¶ 14.
¶28

First, an initiative’s “principal provision” is defined as one

that is “‘most important, consequential, or influential,’ ‘chief’ [or] ‘a
matter or thing of primary importance.’” Molera, 245 Ariz. at 297 ¶ 24
(citation omitted). But an alleged omission of a “principal provision” can
disqualify a petition only if it creates a perception that contradicts its
express terms. Compare id. ¶ 25 (failure to disclose repeal of indexing of
tax brackets to inflation was fatal “because it imposes tax increases on
most Arizona taxpayers rather than only the state’s wealthiest
taxpayers, as the description clearly suggests”), with Save Our Vote, 231
Ariz. at 152 ¶ 27 (failure to disclose that proposed “open primaries”
measure “would not apply to presidential elections or non-partisan
elections is not a fatal omission”), and Wilhelm, 219 Ariz. at 48 ¶¶ 14-15

{00508053.4 }

- 12 -

 (failure to disclose that measure would extend statute of repose did not
“improperly obscure[]” the main substance of the initiative).
Second, a summary does not comply with A.R.S. § 19-102(A)

¶29

if its actual text is “fraudulent or creates a significant danger of confusion
or unfairness.” Molera, 245 Ariz. at 295 ¶ 13. The statute “requires an
objective standard for evaluating the description of the actual
provisions,” id. at 297 ¶ 27, under which courts must “consider the
meaning a reasonable person would ascribe to the description.” Ariz.
Chapter of the Associated Gen. Contractors of Am. v. City of Phoenix
(“Contractors”), 247 Ariz. 45, 48 ¶ 15 (2019).
In short, a summary complies with A.R.S. § 19-102(A) unless

¶30

it contains objective falsehoods or omissions that conflict with the
disclosed “thrust of the measure,” Wilhelm, 219 Ariz. at 48 ¶ 13.
A.
¶31

Molera Is the Exception, Not the Rule.
The trial court invalidated the Initiative based on a

fundamental misunderstanding of this Initiative compared to Molera.
¶32

In Molera, the proposed measure amended Arizona’s

individual tax brackets, and “modifie[d] the inflation indexing of income
tax rates” under which tax brackets adjust to account for inflation. 245

{00508053.4 }

- 13 -

 Ariz. at 295 ¶ 14. The 100-word summary stated only that it would
“rais[e] the income tax rate by 3.46% on individual incomes over a
quarter million dollars (or household incomes over half a million dollars),
and by 4.46% on individual incomes over half a million dollars (or
household incomes over a million dollars),” but did not mention that it
would eliminate indexing. Id. at 293 ¶ 2.
¶33

First, Molera held that the summary’s failure to describe that

the proposed measure would eliminate “income tax indexing” was “a
primary, consequential provision because it imposes tax increases on
most Arizona taxpayers rather than only the state’s wealthiest
taxpayers, as the description clearly suggests.” Id. at 297 ¶ 25 (emphasis
added). It was thus not the mere omission of the change in indexing that
was disqualifying. Instead, it was that the summary included “[a]
description indicating that other people’s taxes will be raised, but not the
taxes of most of those signing the petition,” which “create[d] a significant
risk of confusion or unfairness and could certainly materially impact
whether a person would sign the petition.” Id. And because the question
of preserving indexing was not obvious from the face of the Initiative

{00508053.4 }

- 14 -

 itself, Molera found that “recourse . . . to the measure’s text” was no
salvation. Id. at 298 ¶ 28.
¶34

Second, Molera held that the description of the size of the tax

increase “also ‘creates a significant danger of confusion.’” Id. at 298 ¶ 29.
More specifically, the summary stated that it would increase taxes on the
wealthy “by 3.46% and 4.46%,” when “the affected tax rates would
actually increase by seventy-six percent and ninety-eight percent,
respectively.” Id. This incorrect statement was “confusing” from a
reasonable person’s perspective and “so significant that it could
materially affect whether a person would sign the petition.” Id. ¶¶ 29, 30.
¶35

Just a year later in Contractors, this Court rejected a

challenge to the 100-word description of a municipal initiative and proved
that Molera is not the blunt instrument that Challengers and the trial
court believe it to be. In doing so, the Court encapsulated three
fundamental principles under A.R.S. § 19-102(A): (1) courts must analyze
a summary in its entirety and in context, (2) initiative proponents are not
responsible for “argu[ing] the consequences” or “effects” of an initiative
in the limited space they have, and (3) accurate statements in the
summary are not actionable. Contractors, 249 Ariz. at 49 ¶¶ 17-20.

{00508053.4 }

- 15 -

 B.

The Summary Does Not Omit “Principal Provisions”
The trial court erred as a matter of law by finding that the

¶36

Description

omitted

five

“principal

provisions.”

This

error

is

demonstrated by as 127-word bullet point list of the omitted provisions.
1.

The Initiative’s percentage distribution of funds
is not a principal provision.

The trial court first held that the Description is deficient

¶37

because it does not state “[t]he percentages of revenues to be distributed
to the enumerated groups,” and that “[t]o some reasonable voters,
devoting 50% of the money generated by the Initiative directly to teacher
salaries may have sounded too rich; to other reasonable voters, devoting
50% of the money raised directly to teacher salaries may have sounded
too modest.” [APP3-186-87]
The Description accurately states that the Initiative

¶38

dedicates additional revenue to (a) hire and increase salaries
for teachers, classroom support personnel and student
support services personnel, (b) mentoring and retention
programs for new classroom teachers, (c) career training and
post-secondary preparation programs, (d) Arizona Teachers
Academy
These are the precise areas to which the Initiative will dedicate the
revenue it generates, and the Summary makes no inconsistent
representation or implication elsewhere about the distribution of the
{00508053.4 }

- 16 -

 revenue as between those sources. Indeed, it correctly states that it will
provide “additional” funding to those sources. The trial court’s
speculation about what a “reasonable voter” might believe about the
distribution has no basis in any fact presented by Challengers. The
percentages set forth in the Initiative are not principal provisions, and
this claim must fail.
2.
¶39

The total increase in the marginal rate of
taxation is not a “principal provision.”

Next, the trial court found the Description deficient because

it did not state “[t]he amount of the increase in the marginal rate of
taxation created by the ‘surcharge’ on those who are subject to the
‘surcharge’” and that “[t]he Arizona Supreme Court directly addressed
this in Molera.” [APP3-186-87]
¶40

The trial court’s suggestion that this Court “directly

addressed this in Molera” defies explanation. The description at issue in
Molera explicitly stated that it would “raise” income taxes on particular
earners by particular percentages, which was problematic because the
use of straight percentages to describe the increases was mathematically
incorrect.

{00508053.4 }

- 17 -

 ¶41

In stark contrast, the Description accurately conveyed to

voters that the 3.5% surcharge (a correct usage of a straight percentage)
would apply to “taxable income” above the identified levels. It
“obscure[d]” nothing. Unlike the initiative in Molera, which re-wrote
Arizona’s individual income tax brackets, the Initiative intentionally
detached the surcharge from those brackets to avoid the problems
discussed in Molera, and to leave the task of setting those brackets to the
Legislature. A reasonable person knows that income at these high levels
is already subject to taxation, and the Description didn’t imply otherwise.
¶42

That the marginal tax rate on taxable income above the levels

identified in the Initiative would increase by “77.7%” is irrelevant where
the Initiative (1) involves a surcharge that is clearly described, and (2)
the Initiative does not alter the otherwise-applicable marginal tax rates.
The Committee was not required to catalogue the Initiative’s “effects” or
relationship to extrinsic law. See Contractors, 247 Ariz. at 49 ¶ 18.
3.
¶43

The Initiative’s application to business income is
not a “principal provision.”

The third “principal provision” the trial court identified was

“[t]he fact that the ‘surcharge’ would apply to business income that was
passed along to . . . filers whose taxable income exceed[s] the threshold.”

{00508053.4 }

- 18 -

 [APP3-186] According to the trial court, “[f]or this Initiative – one
creating a “surcharge” – the income subject to the “surcharge” is a
principal provision.” [APP3-189]
¶44

The trial court’s explanation of this purported defect betrays

itself; the Initiative does identify “the income subject to the ‘surcharge’”;
specifically, “taxable income above $250,000 annually for single persons
or married persons filing separately, and on taxable income above
$500,000 annually for married persons filing jointly or head of household
filers.” It applies to all “taxable income” above those levels.
¶45

The erroneous conclusion of the trial court rests on a baseless

premise: that the Committee had a legal obligation to single out just one
of many ways that a person might earn “taxable income” that will be
subject to the surcharge. Not so; the surcharge applies to “taxable
income,” no matter how it’s earned. A single “small business owner” who
reports more than $250,000 in “pass-through” taxable income would be
subject to the surcharge, as would a single corporate CEO, a single
gambler, or a single investor with income earned from qualified
dividends.

{00508053.4 }

- 19 -

 ¶46

If the Committee had singled out “pass-through business

income,” that itself would have been misleading and subject to challenge.
As the evidence demonstrated, at most, “small business” generates 18.5%
of the income that might be subject to the surcharge (an overestimation
that doesn’t account for the $500,000 threshold for joint filers, among
other things). [APP1-042-47]2 Capital gains likewise generate 18.5% of
income at those levels, whereas salaries generate 48.5%, but neither of
those sources of taxable income were singled out by the trial court. [Id.]
¶47

Because the Initiative does not distinguish between sources of

“taxable income,” the Summary did not have to do so either. That
Challengers and their corporate backers prefer this framing of the
Initiative is not a reason to conclude that the Description omitted a
“principal provision.” The embrace of this framework was reversible
error.

Plaintiffs’ expert on this issue used faulty math and unfounded
“adjustments” arising from “brainstorming exercise[s]” to make claims
regarding the surcharge’s purported impact on “small businesses.”
[APP3-138-51] The testimony was unhelpful to Challengers, and the trial
court ignored it [APP3-189], only to rule against the Committee anyway.
2

{00508053.4 }

- 20 -

 4.
¶48

The “no supplant” clause is not a “principal
provision.”

Next on the trial court’s list of omitted “principal provisions”

is “that the Initiative curtails the authority of the Legislature by
preventing it from supplanting the revenues raised by the ‘surcharge.’”
[APP3-186] This clause, the trial court held, was a principal provision
because it “limits the power and authority of the Arizona Legislature.”
[APP3-189]
¶49

When the people of Arizona create a new program through

their initiative power, they presume that it will work and will not be
subject to legislative interference. If the Legislature simply reduced its
appropriation for public education by the amount raised by the Initiative
every year, it would be a futile effort. For that reason, the Initiative
contains several procedural mechanisms, including a clause stating that
“the additional monies received by school districts . . . are in addition to
any other appropriation, transfer or allocation of public or private monies
from any other source and may not supplant, replace or cause a reduction
in other funding sources.” 3 At most, this prevents the Legislature from

This is also why the first line of the Description states that the Initiative
“provides additional funding for public education.” (Emphasis added).
3

{00508053.4 }

- 21 -

 reducing funding based on the new revenue generated by the Initiative.
The Legislature retains discretion over the budget process in every other
way and could still reduce funding to schools for any other reason. [See
APP3-168-69]
¶50

Challengers provided no evidence that this provision of the

Initiative is important to a reasonable person or conflicts with anything
in the Description. In fact, the only evidence related to the “no supplant
clause” was that it is a familiar concept in voter-approved tax increases
that provide education funding. The Initiative’s “no supplant” clause is
identical to that approved by voters in 2000 as part of Proposition 301,
an act renewed by a super-majority of the Legislature in 2018 without
the removal of this imagined limitation on the Legislature. [APP3-16669; Tr. Ex. 37 & A.R.S. § 42-5029(E) (Prop. 301 “no supplant” provision)].
¶51

There is simply no basis to support the idea that this issue

would materially impact whether a reasonable voter would sign the
petition. In any event, the “no supplant” clause is not part of the “thrust”
of the Initiative, which the Description accurately describes. The “no
supplant” language is not a “principal provision.”

{00508053.4 }

- 22 -

 5.
¶52

The “local revenues” clause is not a “principal
provision.”

Lastly, the trial court held that the Initiative’s provision

stating that its revenues are “not considered local revenues” under article
IX, § 21 of the Arizona Constitution was yet another omitted “principal
provision.”
¶53

By disclosing to potential signers the revenue-raising

mechanism and areas of distribution of additional revenue, the
Description adequately described the “thrust” of the measure. It defies
common sense to say that in just 100 words – and on top of everything
else – the Committee had to explain to voters: (1) the aggregate spending
limits prescribed in article IX, § 21, (2) the concept of “local revenues,”
and (3) the Initiative’s statement about “local revenues.”
¶54

Here again, Challengers presented no evidence that this

information would have made any difference to a reasonable person (nor
is it reasonable to assume that a reasonable person understands the
intricacies of article IX, § 21). Just as with the “no supplant” clause, the
Initiative’s “local revenues” clause is identical to that in Proposition 301,
and remained in the 2018 legislative renewal of Proposition 301. [APP3166-69; Tr. Ex. 37 & A.R.S. § 42-5010(G) (Prop. 301 “local revenues”

{00508053.4 }

- 23 -

 clause)] If, as the trial court found, a “reasonable” voter might not
“appreciate” that local revenue limits exist, then declining to mention
that these limits don’t apply to the Initiative is not misleading or
confusing. [APP3-190]. The “local revenues” clause is not a “principal
provision” of the Initiative.
C.

The Summary’s Accurate Use of “Surcharge” Did Not
Create a “Substantial Danger of Confusion.”
Beyond the litany of alleged omitted “principal provisions,”

¶55

the trial court also held that the Summary’s use of the word “surcharge”
“created a substantial likelihood of confusion for a reasonable voter.”
[APP3-190-91] The trial court asserted, without citation to a single fact
in the record, that
[a]lthough the use of the term “3.5% surcharge on taxable
income” may be perfectly understood by some Arizona voters
to be permanently adding 3.5 percentage points to the
taxation rate – an increase [of] 77.7% in the tax rate on
taxable income above the threshold – other[] reasonable
Arizona voters may understand a “surcharge” to mean a
temporary tax, or to mean a modest 3.5% increase of the
existing tax rate.
¶56

The term “surcharge” in the summary does not “create a

significant risk of confusion or unfairness.” The summary explains that
the Initiative “[e]stablishes a 3.5% surcharge on taxable income” above a

{00508053.4 }

- 24 -

 certain annual household income. That’s exactly what the Initiative does
by establishing a surcharge on taxable income above the stated levels.
Moreover, a “surcharge” is, by definition, an “additional charge, tax, or
cost.” Black’s Law Dictionary (11th ed. 2019) (emphasis added); see also
Merriam-Webster.com

Dictionary,

Merriam-Webster,

https://www.merriam-webster.com/dictionary/surcharge (“surcharge” is
“an additional tax, cost, or impost”). This is how reasonable people
understand that term. See State ex rel. Winkleman v. Ariz. Navigable
Stream Adjudication Comm’n, 224 Ariz. 230, 241 ¶ 24 (App. 2010) (“[T]o
glean the plain meaning of the words, we may consult a dictionary for
definitions.”). It’s also consistent with A.R.S. § 5-839, an existing Arizona
statute that uses the term “surcharge” to mean an additional tax. This
Court, in fact, had no difficulty analyzing that “surcharge” as a tax in a
recent opinion. See Saban Rent-a-Car LLC v. Ariz. Dep’t of Revenue, 246
Ariz. 89 (2019).
¶57

The trial court’s belief that the Committee should have used

some other term – one that it and Challengers favor politically – is
irrelevant. Because the use of the word “surcharge” was accurate and

{00508053.4 }

- 25 -

 mirrored the term used in the Initiative itself, it cannot be “confusing” as
a matter of law. Contractors, 247 Ariz. at 49 ¶ 19.4
¶58

The trial court also read the word “surcharge” in isolation,

ignoring the explanation that immediately follows: the “surcharge”
applies to “taxable income” above certain levels for certain filers. “Read
in context, a reasonable person would know” that because the referenced
“surcharge” relates to “taxable income,” it imposes another tax.
Contractors, 249 Ariz. at 49 ¶ 17.
¶59

Even if this were a factual question, the trial court’s

conclusion was still in error. Indeed, there is no evidence in the record
suggesting this word was confusing to anyone, to say nothing of a
“reasonable Arizonan.” Professor John Swain, a tax law expert, testified
that the Description’s use of the term “surcharge” was accurate and not
confusing. [APP3-173-75] David Lujan, who helped draft the Initiative,
testified that the term “surcharge” is accurate. [APP3-170-72] And

After Plaintiffs’ expert stated that “surcharge” was a term that he has
“never” used, he acknowledged that he referred to the Initiative as a “new
tax surcharge” in publicity documents he authored in an attempt to get
reasonable Arizona voters to reject the Initiative at the ballot. [APP3152-54]. Again, the “expert” testimony was not helpful to Challengers,
yet the trial court ignored it in favor of ruling against the Committee on
this issue anyway.
4

{00508053.4 }

- 26 -

 Challengers’ own public opinion study, which the trial

court

conspicuously did not credit, demonstrated that nearly every Arizonan
polled understood the word “surcharge” to mean either a new or
additional tax. [APP3-177-78]
Lastly, the trial court’s belief that Molera provided a roadmap

¶60

about “how to phrase the proposed tax increase” proves its fundamental
misunderstanding of that decision and the Initiative. [APP3-190-91] The
problem in Molera was not that the Initiative didn’t appropriately
“phrase” the tax increase; the problem was that its actual terms
misstated the degree of the tax increase in a confusing manner (i.e., using
the word “percent” instead of “percentage point”). To say the Committee
didn’t follow this Court’s roadmap is inaccurate and disingenuous. The
word “surcharge” is accurate and does not present a “substantial danger
of confusion.”
D.

Expanding A.R.S. 19-102(A) Would Violate the United
States and Arizona Constitutions.
1.

¶61

The First Amendment.

The trial court’s application of A.R.S. § 19-102(A) violated the

Committee’s First Amendment rights because: (1) it amounts to
compelled speech; and (2) it unreasonably burdens core political speech.

{00508053.4 }

- 27 -

 ¶62

Although A.R.S. § 19-102(A) is facially content-neutral, 5 the

trial court applied it to “mandate speech that a speaker would not
otherwise make,” which “necessarily alters the content of the speech.”
Brush & Nib Studio, LC v. City of Phoenix, 247 Ariz. 269, 292 ¶ 100 (2019)
(“When a facially content-neutral law is applied by the government to
compel speech, it operates as a content-based law” and is thus subject to
strict scrutiny); cf. Buckley v. Am. Constitutional Law Found., Inc., 525
U.S. 182, 200-01 (1999) (compelling circulators to disclose their identity
while they circulated petitions violated First Amendment). The State’s
interests are served by requiring that 100-word summaries cannot be
fraudulent or misleading. But the trial court required much more than
that. Its ruling mandates that initiative proponents include words
proposed by opponents (or the court) or face disqualification. This isn’t
“narrowly tailored” to further any State interest.

The Ninth Circuit has held that Nevada’s “single-subject and
description-of-effect requirements” are facially valid “prerequisites” to
circulating petitions, but the initiative proponents in that case failed to
show that these requirements were “applied in a discriminatory
manner.” PEST Comm. v. Miller, 626 F.3d 1097, 1108 (9th Cir. 2010).
Unlike PEST, here the trial court applied § 19-102(A) in a discriminatory
manner by requiring the Committee to include content in its summary
beyond what the statute requires.
5

{00508053.4 }

- 28 -

 ¶63

The

trial

court’s

interpretation

of

§

19-102(A)

also

unreasonably burdens the Committee’s “core political speech.” Meyer v.
Grant, 486 U.S. 414, 423 (1988) (citation omitted). The right to advocate
for and circulate initiative petitions “is the essence of First Amendment
expression.” McIntyre v. Ohio Elections Comm’n, 514 U.S. 334, 347
(1995). If the summary is not fraudulent or misleading, initiative
proponents have the right to decide how they want to express “the merits
of the proposed change.” Meyer, 486 U.S. at 422.
¶64

The Committee had no opportunity for a pre-circulation

review of its 100-word summary (which was filed on February 14).6
Instead, after the Committee gathered hundreds of thousands of
signatures, spent millions of dollars, and submitted its petition sheets,
the trial court did a post-hoc review of the summary and discarded every
signature. It did so because the summary did not use the court’s preferred
wording and failed to include words the Challengers proposed. This
paternalistic interpretation of § 19-102(A) cannot justify the burden on
the Committee’s speech. Cf. Brown v. Hartlage, 456 U.S. 45, 60 (1982)

Unlike PEST, where the initiative summary was a pre-circulation
requirement that opponents had to challenge within 15 days after the
initial petition application was filed. 626 F.3d at 1100-01.
6

{00508053.4 }

- 29 -

 (“The State’s fear that voters might make an ill-advised choice does not
provide the State with a compelling justification for limiting speech.”).
2.
¶65

Article IV.

In addition, expanding A.R.S. § 19-102(A) to fit the trial

court’s rubric would violate Article IV. That provision guarantees the
people’s reserved power to legislate by initiative, and when interpreting
it, the Court should “take . . . into consideration” the importance of this
power to our framers and the voters who overwhelmingly approved it.
Whitman v. Moore, 59 Ariz. 211, 218 (1942).
¶66

The Legislature can enact legislation implementing Article IV

if: (1) it does not “unreasonably hinder or restrict the constitutional
provision,” and (2) “reasonably supplement[s] the constitutional
purpose.” Turley v. Bolin, 27 Ariz. App. 345, 348 (1976). Here, expanding
Molera and A.R.S. § 19-102(A) beyond their narrow scope to require
initiative proponents such as the Committee to summarize initiative
measures in a way that would satisfy the political desires of their
opponents would violate Article IV.

{00508053.4 }

- 30 -

 II.

AZPP’s Circulator Incentive Programs Complied with
Section 19-118.01.
The trial court also erred in its interpretation of A.R.S. § 19-

¶67

118.01 by holding that four of AZPP’s incentive programs violated that
statute. Those portions of its judgment should be reversed.
A.
¶68

The Trial Court Misconstrued A.R.S. § 19-118.01.
A.R.S. § 19-118.01(A) provides that “[a] person shall not pay

or receive money or any other thing of value based on the number of
signatures collected on a statewide initiative . . . petition.” Read literally,
that statute would effectively ban paid petition circulation; after all,
collecting some “number of signatures” is inherent in a contract with a
petition circulation vendor and in the job of being a paid circulator.
¶69

But that statute does not – and constitutionally cannot – ban

paid circulation or preclude the use of productivity standards or
performance metrics to determine eligibility for incentive programs. Yet
that is how the trial court interpreted A.R.S. § 19-118.01 by holding that
it bars any compensation that “hinges on the circulator’s gathering of
signatures” [APP1-014], is “in part, based on the number of signatures
collected” or was “linked to the number of signatures obtained.” [APP3193, 195 (emphasis added)] All formulations add words to the statute,

{00508053.4 }

- 31 -

 and place new and undue burdens on the right to circulate initiative
petitions.
¶70

First, the plain language of A.R.S. § 19-118.01(A) does not

preclude the use of signature collection goals as a factor in offering
incentives. Here, circulators were not “pa[id] . . . based on the number of
signatures

collected”

simply

because

AZPP

required

minimum

productivity goals as one factor for eligibility.
¶71

Second, the trial court’s broad reading of A.R.S. § 19-118.01

finds no basis in the Legislature’s “clearly expressed legislative intent” in
enacting the statute. State v. Estrada, 201 Ariz. 247, 251 ¶ 19 (2001)
(“[W]e will not employ a ‘plain meaning interpretation [that] would lead
to . . . a result at odds with the legislature’s intent.’”) (citations omitted).
¶72

“[W]hen the sponsors of a bill and the very committees

considering that bill tell [the Legislature] and the public what they
intended to accomplish with a specific provision of that bill, such
expressed intentions can be useful to clarify any ambiguity in the
meaning of the enacted legislation.” Hernandez-Gomez v. Leonardo, 185
Ariz. 509, 513 (1996). Here, legislative intent is clear; the Legislature
intended to ban the practice of paying per signature. See 2017 Ariz. Legis.

{00508053.4 }

- 32 -

 Serv. Ch. 52 (HB 2404) (noting that “states have enacted prohibitions on
payment per signature,” and expressing a preference for “circulators paid
by the hour”). This aligned with testimony on the bill:
• In a House Government Committee meeting (at 28:40),
Rep. Leach (the bill’s strident sponsor) testified that he
introduced the bill to “end the process of paying
circulators per signature”;7
• In a House Rules Committee meeting (at 14:25), a rules
attorney explained that the bill imposed only a
“restriction against petition circulators being paid on a
per signature basis”;8
• In a Senate Judiciary Committee meeting, Rep. Leach
testified that under the bill, “[y]ou cannot pay for
signatures by the signature” and that it imposed a “ban
on payment per signature” (at 15:00), and continued (at
28:25) by explaining “you can still pay circulators . . . you
can contract with them. You just can’t pay per
signature”;9
• The Senate Committee of the Whole rejected an
amendment offered by Sen. Mendez (at 57:02) to amend
the legislative finding to apply equally “in the candidate
petition context,” and in debating that amendment, Sen.
Quezada stated (at 58:20, 59:25) that the bill sought to
impose a ban on paying “by the signature.”10

7

http://azleg.granicus.com/MediaPlayer.php?view_id=13&clip_id=18788

8

http://azleg.granicus.com/MediaPlayer.php?view_id=13&clip_id=18888

9

http://azleg.granicus.com/MediaPlayer.php?view_id=13&clip_id=19169

10http://azleg.granicus.com/MediaPlayer.php?view_id=13&clip_id=19241

{00508053.4 }

- 33 -

 Based on these statements, the trial court’s construction of the statute
goes far beyond the Legislature’s “clearly expressed” intent; § 19118.01(A) allows contracting with and paying circulators using
arrangements other than “payment per signature.”
¶73

Third, this legislative history also disposes of another

fundamental issue with the trial court’s interpretation: it leads to a host
of absurd results. State ex rel. Montgomery v. Harris, 237 Ariz. 98, 101
¶ 13 (2014) (“Statutes should be construed sensibly to avoid reaching an
absurd conclusion.”). As noted above, every arrangement for paid
circulation “hinges on” gathering signatures and is “in part [] based” on
a “number of signatures collected.” If that’s the standard, an initiative’s
sponsor could not, for example, contract with a vendor to gather X
number of signatures at Y price without violating § 19-118.01(A). Indeed,
no agreement with a vendor could mention the number of signatures,
requiring that parties agree to commercially unreasonable contracts. The
same is true of a petition circulating vendor and its employees.
¶74

A “result is absurd if it is so irrational, unnatural, or

inconvenient that it cannot be supposed to have been within the intention
of persons with ordinary intelligence and discretion.” Estrada, 201 Ariz.

{00508053.4 }

- 34 -

 at 251 ¶¶ 17-18. The results suggested by the trial court’s interpretation
are just that; limiting the reach of § 19-118.01(A) to the Legislature’s
“clearly expressed intent” avoids such absurdity.
¶75

Fourth, interpreting § 19-118.01(A) to align with its clear

legislative history and to permit incentives that use productivity as one
criteria for eligibility is also the only constitutional interpretation of that
statute, and “[w]henever possible a statute should be construed as to
render it constitutional.” State v. Locks, 91 Ariz. 394, 396 (1962);
Legislative history makes plain that § 19-118.01(A) was narrowly
tailored to align with Oregon’s per-signature prohibition (upheld by Prete
v. Bradbury, 438 F.3d 949 (9th Cir. 2006)), a prohibition that permits the
incentive programs at issue.
¶76

In assessing the constitutionality of limitations placed on the

payment of initiative petition circulators, there is effectively a
“spectrum.” Citizens for Tax Reform v. Deters, 518 F.3d 375, 385 (6th Cir.
2008). On one end is Meyer v. Grant, 486 U.S. 414 (1988), where the
Supreme Court held that a wholesale ban on paying petition circulators
violated the First Amendment. And on the other end is Prete, where the
Ninth Circuit upheld Oregon’s constitutional restriction – as interpreted

{00508053.4 }

- 35 -

 in an administrative rule – barring the practice of paying circulators per
signature. In Prete, the restriction was nearly identical to § 19-118.01(A):
It shall be unlawful to pay or receive money or other thing of
value based on the number of signatures obtained on an
initiative or referendum petition. []
Or. Const., art. IV, § 1b (emphasis added). Despite its facially broad
sweep, an administrative rule tempered the provision by explaining that
“payment cannot be made on a per signature basis,” “[e]mployment
relationships that do not base payment on the number of signatures
collected are allowed,” and the provision permits “paying discretionary
bonuses based on reliability, longevity and productivity, provided no
payments are made on a per signature basis.” Prete, 438 F.3d at 952 n.1
(emphasis added). And in holding that this restriction did not violate the
First Amendment, the Ninth Circuit stressed that it only “prohibits one
method of payment” and “does not prohibit adjusting salaries or paying
bonuses according to validity rates or productivity.” Id. at 962, 968; see
also Initiative & Referendum Inst. v. Jaeger, 241 F.3d 614, 615-16 (8th
Cir. 2001) (upholding ban on paying circulators based on “the number of
signatures obtained,” which it described as “per signature” payments).

{00508053.4 }

- 36 -

 ¶77

When considering this “spectrum,” the Sixth Circuit struck

down an Ohio law (with a criminal overlay) providing that “[n]o person
shall pay any other person for collecting signatures on election-related
petitions or for registering voters except on the basis of time worked.”
The court held that though petitioners are not “constitutionally
guaranteed an endless variety of means, when their means are limited to
volunteers and to paid hourly workers who cannot be rewarded for being
productive . . . they carry a significant burden in exercising their right to
core political speech.” Deters, 518 F.3d at 386-87 (emphasis added).11
¶78

So too here. To interpret § 19-118.01(A) to preclude any

consideration of signature gathering productivity in paying circulators
would “significant[ly] burden” the Committee’s exercise of the “right to
core political speech” in the form of petition circulation. The Legislature
considered the Ninth Circuit’s decision in Prete when enacting HB 2404.
Rep. Leach mentioned it by name when testifying to the Senate Judiciary

See also Indep. Inst. v. Gessler, 936 F. Supp. 2d 1256, 1276 (D. Colo.
2013) (ban on payment per signature violated by the First Amendment);
On Our Terms ‘97 PAC v. Sec’y of State of State of Maine, 101 F. Supp. 2d
19, 26 (D. Me. 1999) (prohibiting payment of circulators “based on the
number of signatures collected” violated the First Amendment); Term
Limits Leadership Council, Inc. v. Clark, 984 F. Supp. 470, 475 (S.D.
Miss. 1997) (similar); Limit v. Maleng, 874 F. Supp. 1138, 1140 (W.D.
Wash. 1994) (similar).
11

{00508053.4 }

- 37 -

 Committee (at 19:36),12 as did a rules attorney during a House Rules
Committee Meeting when explaining (at 13:25-14:02) that HB 2404’s
“restriction against petition circulators being paid on a per signature
basis” was likely constitutional because it is “similar enough to [Prete].”13
Consistent with Prete, § 19-118.01 must be read to permit the incentive
programs at issue.
¶79

Finally, the Court should resolve any residual doubt about

the proper, constitutional interpretation § 19-118.01(A) in favor of the
Committee under the rule of lenity and principles of due process. On top
of prescribing the disqualification of signatures gathered in violation of
§ 19-118.01(A), the statute has a criminal element. And if “a statute is
subject to more than one interpretation, the rule of lenity requires that
doubts be resolved in favor of the defendant and against imposing the
harsher punishment.” State v. Anderson, 199 Ariz. 187, 193 (App. 2000).
Paying or receiving a bonus payment with baseline productivity
requirements should not subject a petition circulation vendor and its

12

http://azleg.granicus.com/MediaPlayer.php?view_id=13&clip_id=19169

13

http://azleg.granicus.com/MediaPlayer.php?view_id=13&clip_id=18888

{00508053.4 }

- 38 -

 employees to criminal sanction. Yet that is the result urged by the trial
court and Challengers here, one the Court can avoid as described above.
B.
¶80

The Incentive Programs Identified by the Trial Court
Complied with Section 19-118.01.
Neither the law nor the evidence supports the trial court’s

conclusion that four of AZPP’s incentive programs violate A.R.S. § 19118.01. As detailed above, none of the programs identified by the trial
court involved payment “based on the number of signatures collected.”
Rather, AZPP advertised certain productivity minimums to ensure that
it was not defrauded by circulators who simply logged hours without
attempting to do their job (which, of course, is to collect some “number of
signatures”).
¶81

Indeed, Challengers’ only evidence (and the only evidence the

trial court cites) for the claim that these four programs violate the statute
are the contest advertisements. [APP3-194] But these advertisements
did not require employees to collect a certain number of signatures; they
set baseline productivity expectations that “allowed [AZPP] the
discretion on whether or not to put good or bad employees into the

{00508053.4 }

- 39 -

 program.” [APP3-121] 14 As the trial court acknowledged, AZPP was
“within its right” to increase hourly rates for employees who “performed
job responsibilities well” or decrease hourly rates “for employees who
have failed to perform their job responsibilities.” [APP3-193] The same is
true when deciding whether an employee is eligible for a bonus.
Beyond that, the trial court ignored that § 19-118.01(A)

¶82

requires proof that a person actually “pa[id] or receive[d]” something of
value. The trial court thus erred in finding that an advertisement for a
bonus program violated the statute.
C.

¶83

The Trial Court’s Interpretation of A.R.S. § 19-118.01
Would Violate the United States and Arizona
Constitutions.
As explained above, interpreting § 19-118.01 to prohibit any

consideration of “the number of signatures” when establishing criteria for
incentive programs for circulators would violate the First Amendment.
E.g., Prete, 438 F.3d at 962, 968. It would also “unreasonably hinder”
Article IV and would not “reasonably supplement” that fundamental
constitutional right. Turley, 27 Ariz. App. at 348.

Moreover, the only circulator Challengers called at trial testified that
his Weekend Warrior bonus was not “conditioned in any way on the
number of signatures [he] collected.” [APP3-085]
14

{00508053.4 }

- 40 -

 D.
¶84

The Trial Court’s Findings in Paragraphs 27, 31, and
32 Are Clearly Erroneous.
The trial court correctly held that “Plaintiffs’ burden is to

prove which circulators were improperly paid” [APP3-194], and “which
signatures are invalid because paid circulators had their compensation
linked to the number of signatures obtained” [APP3-195]. 15 The trial
court also conceded as it must that Plaintiffs failed to “introduce[] actual
records in evidence” to invalidate any signatures. 16 [APP3-198] Despite
that failure, the trial court engaged in a fantastical exercise that entailed
speculating about the number of circulators who may have received
unlawful bonuses and the possible number of signatures those circulators
might have collected. These findings were dicta, but even so, they were
unsupported by the evidence and should be vacated.
¶85

This Court may set aside a trial court’s factual findings if they

“are clearly erroneous or not supported by substantial evidence.”

15

Challengers do not appeal from these holdings.

Plaintiffs failed to mark as trial exhibits or enter into evidence the very
petition sheets that they claim contain signatures of paid circulators.
This Court has affirmed the denial of injunctive relief in a petition
sufficiency challenge that disputed the validity of certain circulators and
signatures because plaintiffs failed to admit petition sheets into evidence.
[See Save our Vote, Opposing C-03-2012, No. CV-12-0301-AP/EL (Mem.
Decision, Sep. 6. 2012)] This is no different.
16

{00508053.4 }

- 41 -

 Nordstrom, Inc. v. Maricopa Cty., 207 Ariz. 553, 558 ¶ 18 (App. 2004). A
trial court’s “purely speculative inferences or conclusions do not
constitute substantial evidence,” Dodd v. Boies, 88 Ariz. 401, 404 (1960).
Here, the trial court made two clearly erroneous factual findings.
¶86

First, the trial court clearly erred in finding that, based on a

review of “Exhibit 67, Plaintiffs have proven that the weekly
compensation of 146 circulators included improper payments for
signatures through an Offending Program.” [APP3-196] Exhibit 67 is
AZPP’s “Payroll Prep Sheets” that list employees’ names, the number of
hours worked, and notes for other payments, such as reimbursements,
payroll discrepancy corrections, or bonuses. [APP3-090-94, 130-34] The
“bonuses” noted on the Payroll Prep Sheet reflect many payments, such
as reimbursements for mileage or other expenses, referral bonuses, or
compensation for collecting candidate signatures. [Id.] The Payroll Prep
Sheets include circulators and office employees. [APP3-097-98]
¶87

At trial (or in deposition before trial), Plaintiffs did not ask

any witnesses to explain, clarify, or confirm the notes suggesting a
payment next to the employees’ names on the Payroll Prep Sheets. Nor
did Plaintiffs introduce evidence that any specific circulator (besides Mr.

{00508053.4 }

- 42 -

 Jensen) received any payments. Both Mr. Bilsten and Mr. Chavez
testified that the Payroll Prep Sheets were not final documents and thus
included errors and inaccurate descriptions of payments. [APP3-095-96,
132-35] But the trial court still found – without citing any evidence – that
“Plaintiffs have proven that the weekly compensation of 146 circulators
included improper payments for signatures through an Offending
Program.” [APP3-196] This was clear error.
¶88

The trial court clarified that certain of AZPP’s bonuses do not

violate § 19-118.01(A), such as “retention and recruitment / referral
bonuses.” [APP3-193] Yet the trial court assumed that (1) all individuals
on the Payroll Prep Sheets were paid circulators who submitted
signatures for the Initiative; and (2) various “bonuses” listed on the
Payroll Prep Sheets were paid under one of the four “Offending
Programs.”
¶89

In reality, many individuals on the Payroll Prep Sheets never

circulated petition sheets for the Initiative. Others were never paid a
bonus through “an Offending Program.” To take just a few examples, the
trial court counted these as illegal bonuses:

{00508053.4 }

- 43 -

 [APP2-014, 38, 48, 53, 59; APP3-196-97] The trial court speculated that
“production” reflects an “Offending Program,” with no testimony or other
evidence to support that inference. But Dillon Ford was not even a
circulator. [APP3-002-83]17 The trial court’s finding that the Payroll Prep
Sheets – alone – somehow prove which circulators were paid which
bonuses on which dates is unsupported by the record. Hodai v. City of
Tucson, 239 Ariz. 34, 40 ¶ 14 (App. 2016) (trial court clearly erred in
making factual finding not supported by the documents that the court
relied on).

See also Ariz. Sec’y of State, Circulator Registrations,
https://apps.azsos.gov/apps/election/circulatorportal/Home/Search. Even
if some individuals on the Payroll Prep Sheets were registered
circulators, there is no evidence in the record that any of them collected
signatures for the Initiative. Many registered circulators who didn’t
collect any signatures for the Initiative appear to be included in the trial
court’s count.
17

{00508053.4 }

- 44 -

 ¶90

Plaintiffs could have (and should have) presented evidence to

prove the nature of every payment listed on the Payroll Prep Sheets and
prove that the payment recipient submitted petition sheets for the
Initiative.18 Plaintiffs obtained through discovery every circulator’s pay
stub that reflected a bonus, yet they only called one circulator as a
witness.

Plaintiffs

also

deposed

and

called

at

trial

AZPP’s

representatives, but did not ask a single question about any pay stubs or
notes on the Payroll Prep Sheets. [APP3-134-35]
¶91

Second, the trial court clearly erred in finding that the

alleged 146 illegal bonus payments “would have yielded 70,080 void
signatures.” [APP3-198] The trial court came up with this number by
assuming that “each circulator”: (1) “worked full time (a 40 hour week)”;
and (2) “obtained the maximum number of signatures every hour (12 per
hour).” [Id.]
¶92

But these assumptions directly contradict the evidence

presented at trial. First, the Payroll Prep Sheets list the exact number of

If this Court were to adopt or give weight to the trial court’s
unconventional approach, it would essentially be shifting the burden in
petition sufficiency challenges to the challenged party to prove a
negative. This would require overturning decades of precedent placing
the burden on initiative challengers.

18

{00508053.4 }

- 45 -

 hours worked, which is often far less than 40. [APP2-002] The trial court
should not have speculated about the number of hours each person
worked. Second, the trial court fabricated the number of signatures that
“each circulator” obtained every hour. This is inexplicable because the
trial court asked Mr. Chavez “what would be the high end” of signatures
a circulator might collect per hour, and he responded, “I think ten is
probably fair.” 19 [APP3-136-37] Because the trial court’s calculation was
“plainly contradicted by the record,” it must be set aside. Himes v.
Safeway Ins. Co., 205 Ariz. 31, 37 ¶ 16 (App. 2003).
¶93

The Court should vacate paragraphs 27, 31, and 32 of the trial

court’s order.
Conclusion
¶94

For these reasons, the erroneous provisions of the trial court’s

judgment should be vacated.

This also assumes that every person identified on the Payroll Prep
Sheets circulated or submitted petitions for the Initiative, and the
evidence at trial made clear that is not the case. [APP3-097]
19

{00508053.4 }

- 46 -

 RESPECTFULLY SUBMITTED this 7th day of August, 2020.
COPPERSMITH BROCKELMAN PLC
By /s/ Roopali H. Desai
Roopali H. Desai
D. Andrew Gaona
Marvin Ruth
Kristen Yost
Attorneys for Defendant/Appellant/CrossAppellee Invest in Education (Sponsored
by AEA and Stand for Children)

{00508053.4 }

- 47 -