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NATIONAL TREASURY EMPLES. UNION v. UNITED STATES

March 19, 1992

NATIONAL TREASURY EMPLOYEES UNION, et al., Plaintiffs,
v.
UNITED STATES OF AMERICA, et al., Defendants. AMERICAN FEDERATION OF GOVERNMENT EMPLOYEES, et al., Plaintiffs, v. UNITED STATES OF AMERICA, et al., Defendants. PETER G. CRANE, et al., Plaintiffs, v. UNITED STATES OF AMERICA, Defendant.



The opinion of the court was delivered by: THOMAS PENFIELD JACKSON

MEMORANDUM AND ORDER

 In November, 1989, Congress enacted comprehensive multititle legislation known as the Ethics Reform Act of 1989 (the "Act"), 5 U.S.C. app. §§ 501 et seq., Pub. L. No. 101-194, 103 Stat. 1760, intended to reinforce standards of integrity within the federal government, both in fact and in the public's perception. Among its manifold provisions the Act undertook to expand the existing restrictions upon off-the-payroll money-making activities of current federal officeholders in all three branches of the U.S. government. One of the activities Congress found suspect, as tending to corrupt (or appearing so), was the venerable practice of some government officeholders -- most conspicuously, Members of Congress themselves -- of accepting "honoraria," i.e., generally a payment of more than token value, from private sources having more than a selfless interest in how the government governs, in return for some ostensibly unrelated and otherwise appropriate act or service, such as a speech to a business convention or an article for a trade journal. Title VI of the Act, imposing limitations on outside earned income, included a provision purporting to prohibit the receipt of honoraria by virtually anyone in federal service.

 In these consolidated cases for declaratory and injunctive relief, two national unions (and one local union chapter) of federal employees, and numerous Executive Branch career civil servants individually, contend that Title VI of the Ethics Reform Act of 1989, to the extent it prohibits their acceptance of payments for their own lawful outside activities, imposes unconstitutional inhibitions on fundamental rights vouchsafed to them by the U.S. Constitution. They ask that the Court so adjudge and declare, and that the United States, and its several officials charged with enforcement of the Act, be enjoined from doing so as to them.

 The individual plaintiffs are currently employed full-time by various Executive Branch departments and agencies of the U.S. government. None of the plaintiffs hold political appointments, elective office, or positions in the Legislative Branch. Each, using his or her own time and personal resources, and in all respects in accordance with the regulations of their respective departments and agencies antedating the effective date of the Act, has written or spoken for valuable consideration on a variety of subjects. *fn1" The Act will prohibit their doing so in the future. They may continue to write or speak if they wish, but not for pay as they have done in the past.

 The case is presently before the Court on cross-motions for summary judgment. No material issues of fact stand as an impediment.

 Plaintiffs contend that the offending provision of Title VI, 5 U.S.C. app. § 501(b) (hereinafter "Section 501(b)"), violates their rights under the First and Fifth Amendments to the Constitution, and that the implementing regulations, issued by the Office of Government Ethics ("OGE"), 56 Fed. Reg. 1721 (1991) (to be codified 5 C.F.R. § 2636), are "arbitrary and capricious" in violation of the Administrative Procedure Act, 5 U.S.C. §§ 551, et seq. ("APA"). *fn2"

 Section 501(b) states in pertinent part:

 an individual may not receive any honorarium while that individual is a Member [of Congress], officer or employee [of any of the three branches of the federal government].

 "Honorarium" is defined in Section 505(3) as:

 a payment of money or any thing of value for an appearance, speech or article by a Member, officer or employee, excluding any actual and necessary travel expenses incurred by such individual (and one relative) to the extent that such expenses are paid or reimbursed by any other person, and the amount otherwise determined shall be reduced by the amount of any such expenses to the extent that such expenses are not paid or reimbursed. *fn3"

 The statute thus prohibits employees from receiving compensation for such private activities as writing non-fiction articles, presenting papers at conferences or meetings, serving as expert witnesses, and giving lectures or conducting seminars in their fields of interest. Plaintiffs, federal employees who do some or all of the above as a second profession or avocation, *fn4" face civil penalties and possible disciplinary action if they continue to receive compensation for their expressive activities while the statute remains in effect.

 No one or more of the relevant Supreme Court cases in the constitutional firmament so far cited by the parties affords a firm fix on the analysis appropriate to a decision in this case. The cases, however, establish what may be considered lines of position, and from the various points at which those lines of position intersect it is possible to dead-reckon to a result.

 I.

 Any lingering uncertainty as to whether a law operating as a financial disincentive to constitutionally protected expressive activity represents a "direct," as distinguished from an "incidental," burden, however, was dispelled by the Supreme Court's recent decision in Simon & Schuster, Inc. v. New York State Crime Victims' Board, No. 90-1059, slip op. (U.S. Dec. 10, 1991) holding that a state statute expropriating, for the victims' benefit, monies paid to an accused or convicted criminal for his or her first-person account of the crime violated the First Amendment. Acknowledging that the state's legislative purpose was to compensate for harm done, not to suppress the thought expressed, the Supreme Court nevertheless found the financial burden alone a sufficient inhibition of protected speech to offend the Constitution although the speaker remained at liberty to speak for free. *fn5"

 The law at issue in Simon & Schuster was, however, a "content-based" statute in the opinion of the Supreme Court. Only income derived from expressions of the criminal's "thoughts, feelings, opinions or emotions" regarding his crime was subject to confiscation. Id. at 2. The state had "singled out speech on a particular subject for a financial burden that it places on no other speech and no other income," the Supreme Court said. Thus even an avowedly "compelling" state interest in "compensating victims from the fruits of crime" was insufficient to save such a law not "narrowly tailored" to that otherwise commendable end. Id. at 16.

 Section 501(b) of the Act, on the other hand, is arguably "content-neutral." Any "speech" or "article" on any subject, or an "appearance" anywhere, by federal employees (excluding those purportedly excepted by the OGE regulations) is proscribed if done for pay. Thus Simon & Schuster is distinguishable, and is apposite to this case principally only insofar as it reinforces the conclusion as to the "direct" nature of the burden imposed by financial penalty laws on protected speech. The Supreme Court expressly declined in Simon & Schuster to address the distinctions, and formulate a rule for a content-neutral statute of similar import. Id., fn.*, at 15.

 II.

 Content-neutral regulatory legislation that also operates nevertheless to inhibit constitutionally protected expressive activity has most recently been addressed by the Supreme Court in Ward v. Rock Against Racism, 491 U.S. 781, 105 L. Ed. 2d 661, 109 S. Ct. 2746 (1989), upholding a municipal regulation governing sound-amplification technology to be used for musical events in a city park. *fn6" Observing that music no less than speech is protected by the First Amendment, but that abatement of excessive noise is of legitimate civic concern, the Supreme Court stated:

 Id. at 791.

 There was, of course, a "governmental interest" at least as significant as noise abatement in universal contemplation when Section 501(b) of the Ethics Reform Act of 1989 was under consideration by Congress. Abuses of the "honoraria" custom and practice were well-documented, as was the consequent erosion of public confidence in the integrity of the government, and had been common public knowledge for many years. *fn7" And Section 501(b) certainly obstructs no ...


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