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This suit was precipitated by an FEC enforcement proceeding in which the California Medical Association (CMA), an unincorporated professional association, and CALPAC, a political committee, were respondents. On April 19, 1979, the FEC had found "probable cause to believe" CMA had violated 2 U.S.C. §441a(a)(1)(C) by making contributions exceeding $5,000 to CALPAC, which CALPAC had accepted. When it was unable to reach a conciliation agreement with the respondents, the Commission filed suit against them on May 22, 1979, in the U.S. District Court for the Northern District of California (Civil Action No. C79-U97-WHO).1
Anticipating the FEC enforcement action, CMA filed a separate suit against the FEC on May 7, 1979, challenging the constitutionality of those provisions of the Act it had allegedly violated. (Civil Action No. 79-4426) Specifically, CMA asked the district court to certify the following constitutional questions to the U.S. Court of Appeals for the Ninth Circuit:
In its opinion of May 23, the appeals court, sitting en banc, rejected all the constitutional claims asserted by CMA. Relying on the Supreme Court's decision in Buckley v. Valeo, the court found that the contribution limits imposed only inconsequential restrictions on rights of free speech. The court observed that these restrictions were minimal compared to the "potent alternative means of expression" available to unincorporated associations like CMA. It noted that CMA, CALPAC and its members could make contributions and expenditures in connection with federal elections, as long as the per-candidate and per-committee contribution limits were respected. Further, CMA, its members and CALPAC could make unlimited independent expenditures to express their political views. Moreover, the court concluded that the contribution limits were supported by a compelling governmental interest, namely preventing the circumvention of the contribution limits, which were intended to minimize both the actuality and appearance of corruption in federal political campaigns.
The court also found that the Act did not abridge Fifth Amendment rights by discriminating against political activities of unincorporated associations. To the contrary, the court concluded that unincorporated associations like CMA are regulated to a lesser degree under the Act. While corporations and labor unions are prohibited from making any contributions or expenditures in connection with federal elections, and individuals are limited to total contributions of $25,000 per year, unincorporated associations have no overall limit imposed on the total amount they may contribute or expend in connection with federal elections. Unlike corporations and labor organizations, they may solicit contributions from anyone and make partisan communications to the general public.
In its appeal to the Supreme Court, filed on June 4, 1980, CMA reiterated the arguments which the appeals court had rejected and restated its claim that the challenged provisions violated both First and Fifth Amendment rights. In challenging the constitutionality of limits on contributions to multicandidate committees, CMA argued that, in its Buckley v. Valeo decision, the Supreme Court had not equated contributions to political committees with contributions to candidates. CMA maintained that "...contributions to political committees are functionally different from contributions to candidates."
In its Supreme Court brief, the FEC challenged appellants' raising of constitutional issues under 2 U.S.C. §437h, a provision by which the Supreme Court may expedite its handling of constitutional challenges to the federal election law. The Commission argued that the provision was "...enacted by Congress in 1974 for the specific purpose of facilitating the resolution of a major constitutional challenge to the Act prior to the 1976 general election." In the Commission's view, appellants sought to "...invoke the extraordinary process of 437h for the purpose of avoiding the Commission's enforcement procedures."
As to the constitutional issues raised in the suit, the Commission supported the decision of the appeals court, reiterating its arguments that the Act violated neither the First nor Fifth Amendment rights of appellants.
On June 26, 1981, the Supreme Court handed down a decision in California Medical Association v. FEC (Civil Action No. 79-1952) that affirmed the earlier decision of the U.S. Court of Appeals for the Ninth Circuit.
In its opinion, the Court upheld the constitutionality of 2 U.S.C. §441a(a)(1)(C), which limits contributions to a political committee to $5,000 per year, per contributor. The Court concluded that the challenged provision did not violate the First Amendment rights of appellants because it was an appropriate means by which Congress could seek to protect the integrity of the contribution restrictions upheld in Buckley v. Valeo (424 U.S. 1 (1976)). The Court said, "If First Amendment rights of a contributor are not infringed by limitations on the amount he may contribute to a campaign organization which advocates the views and candidacy of a particular candidate, the rights of a contributor are similarly not impaired by limits on the amount he may give to a multicandidate political committee, such as CALPAC, which advocates the views and candidacies of a number of candidates."
The Supreme Court also upheld the appeals court's ruling that Section 441a(a)(1)(C) did not violate appellants' equal protection rights under the Fifth Amendment. Appellants had unsuccessfully claimed that the provision allowed corporations and labor organizations to make unlimited contributions to their separate segregated funds while limiting to $5,000 a year the contributions an unincorporated association could make to the multicandidate committee it established. The Court held, however, that no equal protection violation existed. The Court stated, "Appellants' contention ignores the fact that the Act as a whole imposes far fewer restrictions on individuals and unincorporated associations than it does on corporations and unions. The differing restrictions placed on individuals and unincorporated associations, on the one hand, and on corporations and unions, on the other, reflect a congressional judgment that these entities have differing structures and purposes and that they therefore may require different forms of regulation in order to protect the integrity of the political process."
The Court found no merit, however, to the FEC's claim that the appellants' direct appeal to the Court (pursuant to Section 437h of the Act)2 was inappropriate because an FEC enforcement proceeding was pending against appellants (pursuant to Section 437g of the Act). The Court found that neither the legislative history nor the statutory language of Sections 437g and 437h indicated that a direct appeal should be limited to situations where no enforcement proceeding was pending.
1 In its October 21, 1980, opinion in FEC v. California
Medical Association, the district court ordered CMA and CALPAC to pay
the FEC civil penalties of $5,000 each.
2 Section 437h provides for expedited handling of constitutional
challenges to the Act. Section 437h(b), which granted the right of direct
appeal to the Supreme Court, was repealed by Congress in 1988.
Source: FEC Record -- April 1981, p. 7; and
August 1981, p. 1.
California Medical Association v. FEC, 641 F.2d 619 (9th Cir. 1980)
(en banc), aff'd, 453 U.S. 182 (1981).
On August 18, 2003, the U.S. District Court for the District of South Carolina, Columbia Division, granted the Commission's motion for summary judgment in this case.
The plaintiff had appealed a $5,500 civil money penalty the Commission imposed on the Joe Grimaud for Congress Committee and its treasurer Peter J. Cannon for failure to file the Committee's 2001 Year-End Report. Although the Committee filed the report on paper, they were required to file electronically. 11 CFR 104.18(a)(1)-(2). Mr. Cannon alleged that the Committee's computer system was infected with a virus, destroying their records and preventing them from filing electronically.
The district court adopted and incorporated the Report and Recommendation of a U.S. Magistrate Judge after Mr. Cannon failed to file an objection to the report with the district court. In the Report and Recommendation, the Magistrate Judge determined that Mr. Cannon waived all arguments by failing to file objections with the Commission during the Commission's administrative process. The Magistrate further concluded that the Commission imposed the proper penalty called for in its regulations, and Mr. Cannon's claim that he was unable to file electronically because of a computer virus was not an "extraordinary circumstance" under 11 CFR 111.35(b).
Source: FEC Record -- December
2002 [PDF]; and October
2003 [PDF].
On March 2, 1981, the U.S. Court of Appeals for the District of Columbia Circuit dismissed Committee for Jimmy Carter v. FEC (Civil Action No. 79-2425). The court's action came in response to an agreement for dismissal of the appeal, filed by the parties on February 20, 1981. This agreement resulted from the Commission's acceptance of the plaintiff's offer to settle the suit.
Petitioners had originally filed the suit on December 3, 1979, challenging an FEC decision to deny matching funds to the Committee for Jimmy Carter (the Committee), the principal campaign committee of former President Carter's 1976 primary campaign. In its suit, the Committee asserted that the Commission had acted arbitrarily, capriciously and contrary to law in certifying only $88,293.92 of the $185,749 in matching funds requested by the Committee in July 1979. The Commission argued that it was bound by its regulations (11 CFR 133.3 (d) and (e))1 to certify only those funds the Committee needed to retire the legitimate debts of Mr. Carter's primary campaign. The Commission therefore asserted that, if it had granted the Committee's entire request, it would have acted contrary to law by sanctioning an improper use of primary matching funds. Specifically, the Committee had stated in its request for primary matching funds that it planned to use the amount withheld by the Commission ($97,456.08) for the following expenditures. In the Commission's view, none of these constituted qualified campaign expenses.
The Committee argued that the transfers to the 1976 general election committee were part of an ongoing transfer authorization granted by the Commission in February 1977. This authorization had allowed the Committee to transfer $500,000 in private contributions to the compliance fund of the general election committee. These contributions were received after Mr. Carter's nomination to the Presidency in July 1976. Moreover, the Committee argued that the Commission's partial denial of the certification violated Section 134.3(c)(2) of FEC regulations, the provision in effect during the 1976 elections. The Committee claimed that this provision entitled it to receive matching funds up to the full amount of its outstanding debts on the date Mr. Carter was nominated for the Presidency, regardless of whether it received any private contributions after that date.3
The Commission maintained, however, that the transfer authorization had terminated in August 1977 when the Committee repaid $126,515 in matching funds to the U.S. Treasury. The Commission noted that it had requested the repayment because it had certified the funds on the understanding that the Committee planned to transfer $500,000 in private contributions to the compliance fund for the general election committee. The Committee had, however, transferred only $300,000.
In the agreement settling the Committee's claim for matching funds, the Commission agreed to certify $65,650.01 to the Committee, an amount equivalent to qualified legal expenses the Committee had incurred through February 1981. The Commission expressly conditioned this certification on the Committee's consent to:
1 The FEC prescribed revised regulations in May 1979.
Section 133.3(d) is now 9034.1(a) and Section 133.3(e) is now 9034.1(b).
2 Under the Presidential Election Campaign Fund Act,
major party nominees are eligible for public grants of $20 million (plus a
cost-of-living adjustment) to finance their general election campaigns.
3 Under the revised regulation (11 CFR 9034) prescribed
in May 1979, Presidential primary candidates are entitled to continue receiving
matching funds after their date of ineligibility only if the combined total
of their matching funds and private contributions does not cover outstanding
debts.
Source: FEC Record -- May 1981, p. 7.
On June 24, 1983, the U.S. Court of Appeals for the District of Columbia ruled that, since the Carter/Mondale Presidential Committee, Inc. (the Committee) had failed to file its petition for review of certain final FEC repayment determinations within 30 days after the FEC had made them, the court had no jurisdiction over the petition. Filed on July 6, 1982, the Committee's petition concerned certain final Commission determinations with regard to the FEC's audit of the Committee's publicly funded primary campaign in 1980.
Since it dismissed the suit on jurisdictional grounds, the court did not address the issue of whether the FEC could require the Committee to:
Source: FEC Record -- August 1983, p. 8.
Carter/Mondale Presidential Committee, Inc. v. FEC, 711 F.2d 279
(D.C. Cir. 1983).
On November 1, 1985, the U.S. Court of Appeals for the District of Columbia Circuit ruled that the FEC did not abuse its discretion in declining to reconsider a final determination the agency had made with regard to the Carter/Mondale Presidential Committee, Inc.'s (the Committee's) repayment of nonqualified campaign expenses to the U.S. Treasury.1 CA No. 84-1393 and 84-1499 (The Committee was the publicly funded principal campaign committee for former President Carter's 1980 primary campaign.) The court's ruling sustained decisions made by the FEC on July 12 and September 20, 1984, not to reconsider its final repayment determination with regard to the Committee.
On July 6, 1982, the Committee had filed a petition with the appeals court which sought review of an FEC final determination that the Committee must repay $104,300.78 to the U.S. Treasury, an amount equal to those nonqualified expenses incurred by the Committee during the 1980 primary campaign. (Carter/Mondale Presidential Committee v. FEC, 111 F.2d 279 (D.C. Cir. 1983); see summary at left.) The court dismissed the case on grounds that it had not been filed within the time frame required by the election law. See 26 U.S.C. §9041(a).
On August 7, 1984, the Committee filed a petition, asking the Court to review the decision that the FEC made on its own initiative not to reopen its final repayment determination for the Committee in light of recent decisions made by the court in two other suits concerning repayments. (In Kennedy for President Committee v. FEC and Reagan for President Committee v. FEC, the court had held that the FEC had exceeded its authority under 26 U.S.C. §9038(b)(2) when it required repayment of the entire amount of nonqualifying payments, rather than the portion attributable to the matching payment account.) The Committee also asked the FEC to reconsider its decision (taken in July 1984) not to reopen the Carter/Mondale repayment determinations. The Commission had decided to reconsider only the repayments by the Kennedy and Reagan committees, which had been required by the court. The Commission had taken this position " 'in the interest of finality in the administrative process, now and in the future.'" The Committee claimed that the FEC's decision disregarded the principle of equal treatment for all candidates, which the Committee alleged the agency had established in reconsidering a final repayment determination made with regard to John Anderson's publicly funded campaign. On September 20, 1984, the FEC once again declined to reconsider the Committee's final repayment determination. On October 2, 1984, the Committee filed a second petition with the appeals court. On October 15, 1984, the court consolidated this case with the Committee's August 1984 case.
The court rejected the Committee's claim that the FEC's July determination was unlawful because it contradicted a precedent established by the agency's reconsideration of the Anderson Campaign's repayment requirements: "Far from establishing any general or even selective practice of reopening final determinations, the record before us [of the FEC's reconsideration of the Anderson determination] displays only an isolated situation in which the facts distinguishable from those in the case at hand tugged the Commission away from application of the finality principle."
Nor did the court find merit in the Committee's assertion that the FEC had treated the Committee unfairly. "No favoritism can be attributed to the FEC when it carries out the letter of a court's order" to reconsider repayments by the Kennedy and Reagan committees. Moreover, the Committee's tardiness in seeking court review of its own repayment determination contradicts "'Congress' strong interest in resolving federal matching fund audits expeditiously.' 111 F.2d at 289 and n.19."
Finally, the court rejected the Committee's argument that the FEC had failed to give reasons for refusing to reopen its repayment determination. "[A]bsence of an express statement does not render its action unlawful where reasons for that action may be gleaned from its [the FEC's] staff's reports."
1 The public funding statutes require Presidential candidates to repay the U.S. Treasury for nonqualified campaign expenses. 26 U.S.C. §§9007(b)(4) and 9038(b)(2).
Source: FEC Record -- December 1985, pp. 6-7.
Carter/Mondale Presidential Committee, Inc. v. FEC, 775 F.2d 1182
(D.C. Cir. 1985).
The Commission's certification of public funds to the Republican nominee was challenged in Carter-Mondale Reelection Committee, Inc. and the Democratic National Committee v. FEC, filed July 24, 1980. The Carter-Mondale Committee (the Committee) asked the U.S. Court of Appeals for the District of Columbia Circuit to prevent the Commission's certification of the Republican nominees, pending resolution of an administrative complaint filed by the plaintiffs against the nominees. In their complaint to the Commission, the Committee had said that Ronald Reagan would be ineligible for public funds since he had allegedly violated the law on several counts. The Committee had charged that several groups, purportedly making independent expenditures on Mr. Reagan's behalf, were in fact making qualified campaign expenditures with the prior consent of the candidate and his agents. In the suit, the Commission argued that the certification was proper and within the Commission's exclusive jurisdiction. On September 12, the court ruled in the Commission's favor and affirmed the Commission's "action in certifying the nominees' application for funds."
Source: FEC Annual Report 1980, p. 20.
In re Carter-Mondale Reelection Committee, Inc., 642 F.2d 538 (D.C.
Cir. 1980).
This case was voluntarily dismissed as moot when the Commission took action on three complaints the Center had filed with the agency in 1990 and 1991 (Matters Under Review (MURs) 3175, 3249 and 3325). The Center had filed suit to force the FEC to take action but, in March 1994, agreed to suspend the litigation for four months while the FEC worked to resolved the MURs, which concerned excessive contributions.
The U.S. District Court for the District of Columbia dismissed the case on July 11, 1994. (Civil Action No. 93-2250 (SSH).)
Source: FEC Record -- September 1994, p. 8.
Center for Responsive Politics v. FEC, No. 93-2250 (D.D.C. Oct. 29,
1993).
On November 9, 1995, the U.S. Court of Appeals for the District of Columbia dismissed this case.
The Center for Responsive Politics (CRP) and its executive director, Ellen Miller, brought this suit alleging that the FEC acted contrary to law when, in a recent rulemaking (60 FR 31854, June 16, 1995), it failed to repeal regulations that permit publicly funded Presidential candidates to accept private contributions for their general election legal and compliance fund.
The court ruled that the CRP and Mrs. Miller lacked standing to bring this suit. Neither the CRP nor Mrs. Miller suffered harm that could be directly traced to the FEC's action. Additionally, neither one was qualified to bring suit since their alleged injury was outside the statute's "zone of interest" in this case.
Source: FEC Record -- January
1996 [PDF].
Center for Responsive Politics v. FEC, No. 95-1464 (D.C. Cir. Nov.
9, 1995).
On November 14, 1995, the U.S. Court of Appeals for the District of Columbia reversed the district court's dismissal of this case and ordered the court to issue appellants appropriate declaratory relief.
The U.S. District Court for the District of Columbia had dismissed this case on October 28, 1994, on the grounds that the matter was not ripe for review and that the plaintiffs lacked standing to bring the action.
This case involved the FEC's regulatory definition of "member." FEC regulations allow membership organizations to use their corporate funds to send political communications and solicitations, but only to their administrative and executive personnel and to persons who qualify as "members" under federal election law.1 To qualify as a "member" under FEC regulations a person must have a significant financial interest in the organization, or pay regular dues and possess the right to vote either directly or indirectly for at least one representative in the organization's highest governing body, or possess the right to vote for all members of the organization's highest governing body. 11 CFR 114.1(e)(2).
In 1976, FEC regulations defined an organization's "members" as "all persons who are currently satisfying the requirements for membership" in the organization. 11 CFR 114.1(e). In subsequent years, court decisions and advisory opinions established that political communications and solicitations financed with corporate monies could only be sent to persons who have a significant financial or organizational attachment to the membership organization.
In 1993, the FEC adopted new rules to reflect these precedents. These rules clarified that a person will be considered a "member" for purposes of the Act if that person:
When these new regulations took effect, the Chamber of Commerce of the U.S.A. and the American Medical Association (AMA) submitted Advisory Opinion Requests (AORs) 1994-4 and 1994-12 to the Commission, asking about the "member" status of their members. The Commission responded to the AORs by stating that the six Commissioners could not reach a consensus on the status of more than 200,000 Chamber members and nearly 45,000 AMA members; these persons paid dues to their respective organizations but lacked voting rights.
Not satisfied with this result, the Chamber and the AMA challenged the FEC's revised definition of "member" in the U.S. District Court for the District of Columbia.
The district court ruled that:
The court of appeals found that the Chamber and the AMA did have standing to argue their case before the court: "In the last federal election, appellants, not surprisingly, felt constrained to alter their prior practice-they ceased political communications with those constituents who did not qualify as 'members' under the Commission's new rule. and counsel for the Commission agreed . . . that he would not advise the Chamber and the AMA to ignore the rule." Thus, the issue brought before the court was ripe for review because it caused both the Chamber and the AMA harm.
Further, the Chamber and the AMA had standing to bring this suit because, although an FEC enforcement decision had not been issued against them, there was a credible threat of enforcement if they chose to ignore the regulation. Additionally, the possibility that appellants' First Amendment rights were chilled by the FEC's regulations conferred standing upon appellants. Virginia v. American Booksellers.
The court found that the FEC's rules presented "serious constitutional difficulties" because they precluded "appellants from communicating on political subjects with thousands of persons, heretofore regarded by the Commission as members." Thus, although the court did not disagree with the district court's conclusion that the FEC was entitled to deference under the Chevron doctrine, the court reasoned that the conflict between the rules and the First Amendment warranted judicial review.
At issue here, in the court's view, was whether the FEC's rule accorded with the Supreme Court's opinion in FEC v. National Right to Work Committee (459 U.S. 197, 1982). There, the Court ruled that "members of nonstock corporations were to be defined . . . by analogy to stockholders of business corporations and members of labor unions . . . [which] suggest[ed] that some relatively enduring and independently significant financial or organizational attachment is required . . . "
The appeals court concluded that the FEC's new rule did not square with the Supreme Court's opinion in NRWC: "[I]mplicit in the Commission's rule is the view that dues, no matter how high, are not by themselves a manifestation of a significant financial attachment." The court said that the FEC's position reads the disjunctive "or" between "financial" and "organizational" as if the Supreme Court had used the conjunctive "and."
Furthermore, the court held that, "It is . . . quite illogical to regard someone who has one share of stock in a public corporation, which can be sold in minutes, as more significantly attached to the organization than a person or entity who pays $1000 or even $100,000 (as is the case for some Chamber members) in annual dues."
The court also criticized the rule's voting requirement. It noted that the nearly 45,000 AMA members in question are subject to sanction by the organization should they violate the organization's Principles of Medical Ethics. "It might be thought, that for a professional, placing oneself in such a position is the most significant organizational attachment."
Lastly, the court noted that the rule treats some labor unions and federated rural electric cooperatives differently, exempting them from its new definition of "member." The court noted that this question had not been squarely presented on appeal, but stated that it was not satisfied with the FEC's claim that the separate treatment was consistent with the Act's legislative history. Without further elaboration, the court stated, it "would determine that these exemptions make the regulation arbitrary and capricious."
1 This is an exception to the general ban on the use of corporate money in connection with federal elections. 2 U.S.C. §441b.
Source: FEC Record -- December 1994, p. 1; and
January 1996 [PDF].
Chamber of Commerce v. FEC, 1994 WL 615786 (Oct. 28, 1994); No. 94-5339
(D.C. Cir. Nov. 14, 1995).
On August 21, 2007, the U.S. District Court for the District of Columbia
granted the Christian Civic League of Maine, Inc.’s (CCL) request for declaratory relief regarding campaign finance law restrictions on a radio ad planned by CCL. CCL had challenged the constitutionality of the Bipartisan Campaign Reform Act’s (BCRA) electioneering communication financing restrictions as applied to certain so-called “grassroots lobbying” ads. The court denied CCL’s request for declaratory relief as to other communications and CCL’s request for injunctive relief.
CCL is a nonprofit corporation
organized under section 501(c)(4) of
the Internal Revenue Code that allegedly
engages in some business activity.
CCL wanted to use its general
treasury funds to broadcast a radio
ad prior to a 2006 Senate vote on a
particular proposed constitutional
amendment. The ad identified Senator
Olympia Snowe by name and was
to air in close proximity to her June
13, 2006, primary election. If the ad
had aired in Senator Snowe’s state
within 30 days prior to her primary
(or 60 days prior to the general), it
would have qualified as an electioneering
communication (EC).
2 U.S.C.
434(f)(3)(A)(i). Under the Federal
Election Campaign Act (the Act), as
amended by the Bipartisan Campaign
Reform Act, corporate funds cannot
be used to finance an EC. CCL’s suit
contends that this financing restriction
prevents it from exercising its
First Amendment right to free speech.
The Supreme Court upheld the electioneering communications provision in McConnell v. FEC, stating that, although the provision might apply to some so-called “issue ads,” it is narrowly tailored to meet a compelling government interest. 540 U.S. 93, 206 (2003). After McConnell, on June 25, 2007, the Supreme Court upheld a district court ruling in another case that concerned the constitutionality of the electioneering communications provisions, FEC v. Wisconsin Right to Life (WRTL). In that case, the court found the electioneering communication financing restrictions unconstitutional as applied to ads that WRTL, a 501(c)(4) nonprofit corporation, intended to run before the 2004 elections. The Supreme Court concluded that the electioneering communication financing restrictions are unconstitutional as applied to these ads because:
CCL did not broadcast “Crossroads” and, on April 3, 2006, filed a complaint challenging the constitutionality of the electioneering communication financing restrictions as applied to its planned ads. On September 27, 2006, the district court dismissed CCL’s request for a permanent injunction to prevent the FEC from applying its electioneering communications rules to “Crossroads,” concluding that the Senate’s June 2006 vote on the legislation referenced in the ad had rendered the issue moot. The court further granted the FEC’s motion for dismissal of CCL’s claims about possible other ads because they were not ripe for review and were too speculative. CCL admittedly had no firm plans to create or distribute any future ads besides the spring 2006 ad. The Constitution requires an actual “case or controversy” for the court to decide, so a party’s grievance cannot be solely hypothetical.
On May 9, 2006, the U.S. District Court for the District of Columbia denied the Christian Civic League of Maine’s (CCL) motion for a preliminary injunction.
The court cited the Supreme Court finding in McConnell v. FEC that the government had a compelling interest in limiting the expenditure of corporate treasury funds via the electioneering communication (EC) provision contained in the Act. It also restated from McConnell that the EC provision is not a ban on expression, but rather a requirement that corporations fund certain advertisements through their separate segregated funds. The court found that the communication CCL intended to air was functionally equivalent to the “sham issue advertisements” that the McConnell court identified.
Although the court found that the CCL had several different options in communicating its message that would avoid violating the electioneering communication provision, CCL chose not to exercise these options. Therefore, the court found that CCL had not established the likelihood of irreparable harm and that granting a preliminary injunction would harm the interest of the Commission and the public by preventing the enforcement of an Act of Congress.
On September 27, 2006, the U.S. District Court for the District of Columbia granted partial motions to dismiss and for judgment on the pleadings, and dismissed all other CCL claims as moot.
The CCL filed a complaint on April 3, 2006, with the U.S. District Court for the District of Columbia asking the court to find the statutes and regulations regarding electioneering communications to be unconstitutional as applied to broadcast advertisements that CCL contends constitute “grassroots lobbying.” CCL further requests preliminary and permanent injunctions enjoining the FEC from enforcing these regulations against CCL and payment of attorneys’ fees.
CCL is a nonprofit corporation group organized under 501(c)(4) of the Internal Revenue code. It claims that it is not a qualified nonprofit corporation within the meaning of 11 CFR 114.10. CCL seeks to air a radio advertisement and other broadcast communications that are electioneering communications (EC) under the Federal Election Campaign Act (the Act). The Act prohibits corporations from distributing or financing ECs with corporate treasury funds.
CCL contends that its communications cannot constitutionally be regulated because they are “grassroots lobbying” communications. CCL believes that it is constitutionally entitled to pay for its planned advertisements with general corporate funds.
The district court dismissed CCL’s request for a permanent injunction to prevent the FEC from applying its EC rules to CCL’s proposed ad, concluding that the Senate’s vote on the legislation referenced in the ad had rendered the issue moot. CCL contended that its situation fit within the “capable of repetition, yet evading review” exception to the mootness
doctrine. The court disagreed, noting that CCL’s claims were closely tied to the facts surrounding the spring 2006 ad, circumstances that were unlikely to recur and would not necessarily evade review even if they did recur. The court further granted defense motions for dismissal of CCL’s claims about possible other ads because they were not ripe for review and were too speculative. CCL admittedly had no firm plans to create or distribute any future ads besides the spring 2006 ad. The Constitution requires an actual “case or controversy” for the court to decide, so a party’s grievance cannot be solely hypothetical.
On October 2, 2006, the U.S. Supreme Court dismissed as moot CCL’s appeal of the district court’s May 9, 2006, denial of a preliminary injunction.; see June 2006 [PDF] Record. On May 12, 2006, CCL filed an appeal with the U.S. Supreme Court and moved for expedited consideration and consolidated briefing of the matter. On May 15, the Court rejected CCL’s motion to expedite and consolidate.
On August 21, 2007, the U.S. District Court for the District of Columbia granted the CCL’s (CCL) request for declaratory relief regarding campaign finance law restrictions on a radio ad planned by CCL.
Although the district court in CCL v. FEC had held in its earlier opinion that CCL’s claims regarding “Crossroads” were moot, the court reviewed that opinion in light of the Supreme Court’s decision in WRTL and found that these claims were not moot because they fell within the Supreme Court’s exception for claims that are “capable of repetition, yet evading review.” Having reached the merits of the claims, the court found that, in accordance with the Supreme Court’s decision in WRTL, the BCRA’s electioneering communication financing restrictions are unconstitutional as applied to CCL’s 2006 "Crossroads” ad. The court granted CCL’s request for declaratory relief with regards to this ad, but denied CCL’s request
for declaratory relief with regard to other communications and denied its request for injunctive relief.
Source: FEC Record -- May 2006 [PDF]; June 2006 [PDF]; November 2006 [PDF]; October 2007 [PDF].
Christian Civic League of Maine, Inc. v. FEC, 529 U.S. 05-1447 (Oct. 2, 2006)
On November 16, 1998, the U.S. Supreme Court refused to review two court cases that posed First Amendment challenges to limits on campaign contributions and expenditures in state and local elections. Both cases had been cast as potential challenges to Buckley v. Valeo, the landmark court case on the Federal Election Campaign Act (the Act). The FEC was not a party to either suit.
The appellate courts' reasoning in the two cases was based in great part on Buckley, where the high court equated campaign spending with the First Amendment's guarantee of free speech. While the Court found that a compelling government interest in preventing real or perceived corruption justified imposing restrictions on contributions, it concluded that this governmental interest was inadequate to sustain limitations on campaign expenditures.
In the first case, Cincinnati v. Kruse, John Kruse, a candidate for a Cincinnati City Council seat, challenged a council ordinance that limited campaign expenditures for council elections to about $140,000. The city council argued that the rising cost of city council races had resulted in a rise in the influence of wealthy donors and the decline in the influence of small donors. The U.S. District Court for the Southern District of Ohio at Cincinnati ruled in favor of Mr. Kruse, finding that the ordinance was unconstitutional on its face.
The U.S. Court of Appeals for the Sixth Circuit affirmed that ruling on April 27, 1998. It reiterated the Supreme Court's view that restrictions that have the potential of limiting the First Amendment guarantee of political expression must be subjected to "exacting scrutiny" by the courts and that "the prevention of corruption or the appearance of corruption" is the only governmental interest that survives strict scrutiny and, as a result, justifies restrictions on campaign finance.
The court also said the perception that the public is discouraged and cynical about the democratic process as a result of perceived corruption in campaign finance is not sufficient evidence for limiting campaign spending.
In Burris v. Russell, Ron Russell challenged the Arkansas Ethics Commission after the state's voters approved a referendum that set contribution limits per election for district races at $100 per contributor and for statewide races (such as governor and state treasurer) at $300 per contributor. (The lowest contribution limit per contributor allowed under Buckley is $1,000.) The referendum also introduced an entity called the small-donor PAC. Individuals could contribute up to $25 to the PAC, and the PAC, in turn, could contribute up to $2,500 per candidate, per election. The initiative also created independent expenditure committees that could accept no more than $500 from any person annually. Finally, the initiative authorized local governments to set reasonable limits on the amount of campaign funds candidates for local offices could raise. Before this initiative, Arkansas voters had approved a measure that limited PAC contributions to $200 per year, down from $1,000.
This case was merged with Citizens for Clean Government v. Russell. The U.S. District Court for the Eastern District of Arkansas rendered a split decision, upholding some of the contribution limits and ruling others unconstitutional. On June 4, 1998, the U.S. Court of Appeals for the Eighth District struck down the individual and PAC contribution limits.
This same pattern emerged with contributions to legislators from several lobbyists who represented various groups, including real estate interests. Again, none of the contributions individually exceeded $1,000.
The court found that the $100 and $300 contribution limits approved in the voter initiative were too low to allow meaningful participation in the political process. The court also held that the $200-per-year PAC contribution limit enacted before the voter initiative was "simply too low to allow for appropriately robust participation in protected political speech and association."
The court concluded that, "the limitations in question here are . dramatically lower than, and different in kind from, the limits approved in Buckley, and thus are unconstitutionally low."
"If any contribution is likely to give rise to a reasonable perception of undue influence or corruption, it would be one from an entity permitted to contribute two-and-a-half times the amount that most others are allowed to contribute," the court stated. "The small-donor PAC provision is not, then, narrowly tailored to serve the compelling government interest of combating the reality or perception of undue influence or corruption."
Severability. The court found that the contribution limits were severable from the remainder of the voter initiative. It let stand the provisions for independent expenditure committees and rendered no decision on the instructions to local governments to establish reasonable limitations on campaign contributions and expenditures.
Source: FEC Record --
January 1999 [PDF].
Kruse v. City of Cincinnati, 142 F.3d 907 (6th Cir. 1998), cert.
denied 1998 WL 651027 (U.S.);
Russell v. Burris, 146 F.3d 563 (8th Cir. 1998), cert. denied, 119
S. Ct. 1040 (1999).
On October 27, 2005, the US District Court for the District of Columbia granted the parties’ joint motion to dismiss this case, which challenged the Commission’s refusal to provide documents relating to an ongoing enforcement matter.
On July 12, 2004, Citizens for Responsibility and Ethics in Washington’s (CREW), a nonprofit 501(c)(3) corporation, asked the FEC to provide it with an investigative report prepared by counsel for Westar Energy Company (Westar) regarding possible campaign finance violations by the company. CREW believed the report had been voluntarily forwarded by Westar to the FEC.
The FEC denied CREW’s request for information, citing the “confidentiality provision” of the FECA. Under this provision, any “notification or investigation made under this section shall not be made public by the Commission without the written consent of the person receiving such notification or the person with respect to whom such investigation is made.” 2 U.S.C. §437g(a)(12)(A).
CREW appealed the FEC’s denial of its Freedom of Information Act (FOIA) request, arguing that the “confidentiality provision” does not apply to the Westar report. The FEC denied the appeal. The plaintiff filed a court complaint on September 30, 2004.
On May 16, 2005, the U.S. District Court for the District of Columbia granted the FEC’s motion for summary judgment in this case, and denied the plaintiff’s motion for summary judgment, finding that the FEC’s interpretation of the confidentiality provision of the Federal Election Campaign Act (FECA) is reasonable.
In court, the plaintiff argued that the Westar report does not fall under the FECA’s confidentiality provision because that provision does not apply to matters in their pre-investigatory stage. The FEC argued, to the contrary, that the provision applies to all information in its open enforcement files.
The standard for judicial review of an agency’s construction of a statute it administers is called Chevron review, after the Supreme Court’s decision in Chevron, U.S.A., Inc. v. Natural Resources Defense Council, 467 U.S. 837 (1984). In Chevron review, the court asks first whether Congress has spoken to the precise issue at hand. If so, then the agency’s interpretation of the statute must implement Congress’s unambiguous intent. If Congress has not spoken explicitly to the question at hand, then court must ask a second question--whether the agency’s rules are based on a permissible reading of the statute. If the agency’s interpretation is reasonable, then the court must defer to that interpretation.
In this case, the court found that the Act’s confidentiality provision does not speak to the precise issue at hand because it can support both the plaintiff’s and the defendant’s interpretations. Under the second step of Chevron review, the court found that the FEC’s interpretation of the provision is reasonable because it “satisfies the heightened privacy concerns of the FECA confidentiality provision and minimizes the adverse consequences of public knowledge of that ignominious pre-investigatory status.”
The plaintiff had also taken issue with the FEC’s unwillingness, in response to their FOIA request, to acknowledge whether it had the Westar report at all. The FEC countered that acknowledging possession of the report would in itself reveal confidential information. The court concluded that the FEC acted appropriately and in the best interests of the confidentiality provision.
The court granted the FEC’s request for summary judgment and denied the plaintiff’s request for summary judgment. CREW subsequently filed a motion for reconsideration of the court’s decision.
Plaintiffs had filed a Freedom of Information Act (FOIA) request with the FEC in 2004 seeking access to documents concerning the agency’s ongoing investigation of Westar Energy, Inc.. The Commission denied the request, citing the confidentiality provisions of 2 U.S.C. 437g(a)(12(A). CREW challenged that decision in court, but in May 2005 the district court upheld the agency’s response. CREW immediately asked the court to reconsider.
On August 18, 2005, the FEC closed its enforcement case against Westar and publicly released the documents CREW had sought, thereby rendering the request for reconsideration moot.
Source: FEC Record --
November 2004 [PDF]; July 2005 [PDF]; December 2005 [PDF].
On January 12, 2007, the U.S. Court of Appeals for the District of Columbia upheld the district court’s summary judgment in favor of the FEC, finding that Citizens for Responsibility and Ethics in Washington (CREW) lacked standing to challenge the Commission’s dismissal of its administrative complaint.
According to the administrative complaint, CREW filed during the 2004 campaign, Grover Norquist, head of Americans for Tax Reform, provided Kenneth Mehlman, campaign manager for Bush-Cheney ’04, with a master list of conservative activists. CREW alleged that the list represented either a prohibited in-kind corporate contribution, if made by ATR, or an excessive contribution, if made personally by Mr. Norquist. In either case, CREW stated that the contribution was also illegal because it was not reported to the FEC. 2 U.S.C. §§441b(a), 441a(a)(1)(A), 441a(f), 434(a) and 434(b).
On October 19, 2004, the Commission determined to take no further action in this matter and to close the file. According to the Commission’s First General Counsel’s Report, the contribution appeared to be “limited in size and impact,” and the Office of General Counsel recommended that the Commission “exercise its prosecutorial discretion and take no further action” in the matter.
On December 13, 2004, CREW filed a complaint with the U.S. District Court for the District of Columbia asking the court to find that the Commission acted contrary to law when it dismissed the plaintiff’s administrative complaint (MUR 5409) dated February 4, 2004. The administrative complaint alleged that Grover Norquist, Americans for Tax Reform (ATR), Ken Mehlman and Bush-Cheney ’04 (BC ’04) violated the limits, prohibitions and reporting requirements of the Federal Election Campaign Act (the Act).
CREW asked the court to find that the Commission’s dismissal of the allegations in its administrative complaint was based on an impermissible interpretation of the Act and was arbitrary, capricious, an abuse of discretion and contrary to law. 2 U.S.C. §437g(a)(8)(A). CREW asked that the court:
The FEC filed a motion for summary judgment on April 15, 2005, arguing that CREW lacked standing to pursue the action.
In order to have standing, the plaintiff must satisfy three requirements: injury, causation and redressability. The injury standard is met when the plaintiff suffers an actual, not abstract, invasion of a concrete, legally protected interest. Causation is proved when the injury is fairly traceable to the defendant’s action in question. Lastly, it must be likely, not merely speculative, that a favorable court decision will redress the injury.
CREW argued that the FEC should assign a monetary value to the master list and publicly disclose that figure, to facilitate CREW in its mission of “empowering citizens.” In order to have standing, however, the plaintiff must prove it has suffered an injury in fact to its own interests, not simply assert that it would be unable to help others achieve abstract goals. CREW cannot vote, nor does it have any members who participate in the political process. Therefore, the court held that CREW could not have suffered from a lack of information in the voting process.
On November 15, 2005, the U.S. District Court for the District of Columbia granted the FEC’s motion for summary judgment finding that CREW lacked standing to challenge the Commission’s dismissal of its administrative complaint.
On December 13, 2004, CREW filed suit to challenge the FEC’s decision not to pursue further investigation. The FEC filed a motion for summary judgment on April 15, 2005, arguing that CREW lacked standing to pursue the action. The motion was granted by the district court on November 14, 2005.
In order to have standing, the plaintiff must satisfy three requirements: injury, redressability and causation. The injury standard is met when the plaintiff suffers an actual, not abstract, invasion of a concrete, legally protected interest. Redressability is proved when it is likely, not merely speculative, that a favorable court decision will redress the injury. Lastly, when the injury is fairly traceable to the defendant’s action in question, the causation standard is satisfied.
CREW argued that the FEC should have required Bush-Cheney ’04 to assign a precise monetary value to the master list and publicly disclose that figure to help CREW in its mission of “empowering citizens.” In order to have standing, however, the plaintiff must prove it has suffered an injury in fact to its own interests, not simply assert that it would be unable to help others achieve abstract goals. CREW cannot vote, nor does it have any members who participate in the political process. As a result, the appeals court upheld the district court’s conclusion that CREW could not have suffered from a lack of information in the voting process.
Like the district court, the court of appeals also found that CREW was unable to prove standing based on the standards of redressability and causation. CREW complained that the FEC’s failure to require Bush-Cheney ’04 to publicly disclose and report the monetary value of the master list was a violation of the Act. However, the court noted that while the Act requires the FEC to negotiate a conciliation agreement after a “reason to believe” determination and “probable cause,” the Act does not require that disclosure of information be part of the conciliation agreement. Therefore, the Commission is not legally bound to requiring, or the court granting, the disclosure of the information to redress the situation.
To prove causation, the alleged harm must be fairly traceable to the defendant’s action. The court inferred that the alleged harm suffered by CREW was based on the FEC’s decision to dismiss the complaint in order to focus its resources
on more pertinent matters. The court did not find that the FEC violated any legal principle when it dismissed the administrative complaint because the FEC retains prosecutorial discretion and is not expected to bring every administrative complaint to court. In support of its ruling, the court cited Common Cause v. FEC, 108 F.3d 413 (D.C. Cir. 1997). Under circumstances similar to those in CREW’s case, Common Cause was held not to have standing.
Source: FEC Record -- February 2005 [PDF]; January 2006 [PDF]; February 2007 [PDF].
On December 13, 2007, Citizens United, a nonprofit membership corporation, filed a complaint in the U.S. District Court for the District of Columbia challenging the constitutionality of the statutory provisions governing disclaimers on, and disclosure and funding of, certain "electioneering communications” (ECs). On January 15, 2008, the District Court denied Citizens United’s motion for a preliminary injunction, in which Citizens United requested that the court prevent the FEC from enforcing its electioneering communications provisions.
An EC is a broadcast, cable or satellite communication that refers to a clearly identified federal candidate and is publicly distributed within 30 days of a primary election or within 60 days of a general election. 2 U.S.C. §434(f)(3)(A)(i) and 11 CFR 100.29(a). Corporations and labor organizations are generally prohibited from using their general treasury funds to finance ECs. 2 U.S.C. §441b(b)(2) and 11 CFR 114.2(b)(2)(iii).
The Commission recently modified its regulations governing the funding of ECs by corporations and labor organizations in response to the Supreme Court’s decision in FEC v. Wisconsin Right to Life, Inc. (WRTL II). In that case the Supreme Court held that because the ads in question were not the “functional equivalent of express advocacy,” the prohibition on corporate or labor organization funding of ECs was unconstitutional as applied to WRTL’s ads. The Court further held that a communication is the “functional equivalent of express advocacy” only if it “is susceptible of no reasonable interpretation other than as an appeal to vote for or against a specific candidate.”
The FEC revised its rules to provide a general exemption from the prohibition on corporate and labor organization funding of ECs unless the communication is susceptible of no reasonable interpretation other than as an appeal to vote for or against a clearly identified federal candidate. The revised regulations do not exempt any ECs from the reporting and disclaimer requirements.
Citizens United is a nonprofit membership organization registered with the IRS under 26 U.S.C. §501(c)(4). One of Citizens United’s activities is the production and distribution of political films. Citizens United has produced a film entitled “Hillary: The Movie” about Senator Hillary Clinton. Citizens United intends to broadcast television ads promoting “Hillary: The Movie” and wishes to make the film available in theaters, through DVD sales and via home viewing through cable video-on-demand systems.
Citizens United asserts that, since the ads are not subject to the EC corporate funding restriction, it is unconstitutional to require disclosure of the donors who paid for the advertisements or disclaimers on the advertisements. Citizens United also claims that the film itself is constitutionally exempt from the corporate funding restriction under WRTL II.
Citizens United asks the court to declare the EC disclosure and disclaimer requirements unconstitutional as applied to Citizens United’s ads and all electioneering communications now permitted by WRTL II. Additionally, the plaintiff requests that the corporate and union EC funding restriction be declared unconstitutional both on its face and as applied to plaintiff’s movie. Citizens United seeks preliminary and permanent injunctions preventing the Commission from enforcing each of these provisions. The plaintiffs also request costs and attorneys fees and any other appropriate relief.
The district court denied Citizens United’s motion for a preliminary injunction. In order for a court to grant the plaintiff a preliminary injunction, the plaintiff must show 1) that it is likely that the plaintiff will have success when the case is decided on the merits; 2) that the plaintiff will suffer irreparable injury if the injunction is not granted; 3) that an injunction would not substantially injure other parties; and 4) that the injunction would benefit the public interest.
With regard to its claims about the movie itself, the court found that Citizens United had little chance of success on the merits because the movie is susceptible of no reasonable interpretation other than as an appeal to vote against Senator Clinton. Thus, the court held that the movie is the functional equivalent of express advocacy and not entitled to exemption from the ban on corporate funding of electioneering communications.
Regarding the proposed ads, Citizens United argued that the EC disclosure and disclaimer requirements were unconstitutional because the Supreme Court in WRTL so narrowed the constitutionally permissible scope of "electioneering communication” that only communications that are not "susceptible of [a] reasonable interpretation other than as an appeal to vote for or against a specific candidate” can be regulated by Congress. The district court, however, held that the Supreme Court in McConnell v. FEC had found the disclosure requirements constitutional as to all electioneering communications, and WRTL did not disturb this holding because the “only issue in [WRTL] was whether speech that did not constitute the functional equivalent of express advocacy could be banned during the relevant pre-election period.” Thus, the district court held that Citizens United had not established the probability that it will prevail on the merits of its arguments against the electioneering communication disclosure and disclaimer provisions.
Given that Citizens United did not show that it was likely to win its arguments on the merits, the district court did not find that the harms Citizens United claimed it would suffer under the disclaimer and disclosure requirements warranted preliminary relief. The court also found that enjoining the enforcement of the electioneering communication provisions at issue would not serve the public interest “in view of the Supreme Court’s determination that the provisions assist the public in making informed decisions, limit the coercive effect of corporate speech, and assist the FEC in enforcing contribution limits.” The court denied Citizens United’s request for a preliminary injunction with regard to the reporting and disclaimer provisions.
Source: FEC Record -- February 2005 [PDF].
On March 10, 1997, the U.S. Court of Appeals for the District of Columbia Circuit ruled in the FEC's favor, granting its motion for summary affirmance in this case and denying the motion of John P. Clark and the Green Party USA for emergency summary reversal. The ruling upholds the district court's denial of a motion by Mr. Clark, other individual voters and the Green Party to intervene in a suit brought by the Natural Law Party (NLP) and its presidential and vice-presidential candidates against the FEC and the Commission on Presidential Debates (CPD).
This case stemmed from an October 4, 1996, ruling from this same court that upheld a lower court ruling and dismissed lawsuits filed against the FEC and the CPD by the NLP and the presidential and vice presidential candidates running under the Reform Party banner. Both the NLP and the Reform Party candidates had sought to participate in the presidential debates being sponsored by the CPD. The CPD excluded the candidates-the NLP's Dr. John Hagelin and Mike Tompkins and the Reform Party's H. Ross Perot and Pat Choate-from the debates, saying that the minor party candidates did not meet the criteria for participation.
On September 6, 1996, the NLP filed an administrative complaint with the FEC and, on September 13, filed suit in U.S. District Court for the District of Columbia, contending that the CPD had violated FEC rules governing nonpartisan candidate debates. 11 CFR 113.10. Specifically, the NLP suit asked the court to impose a temporary restraining order and issue preliminary and permanent injunctions to prevent the CPD from using any debate selection criteria that did not comply with FEC rules. In the alternative, it asked the court to order the FEC, prior to the debates, to take action on its administrative complaint.
The Green Party, Mr. Clark and seven other individuals, all independent voters or supporters of the Green Party USA and its 1996 presidential candidate Ralph Nader, filed a motion for intervention on September 27, 1996. The district court found that Mr. Clark and the others "show[ed] their curiosity in the case, but.fail[ed] to demonstrate sufficient grounds for intervention." On September 30, the court therefore denied the motion for intervention. However, it did grant Mr. Clark leave to file a brief as a friend of the court.
On November 22-more than a month after the appeals court had ruled in this case and weeks after the debates and 1996 elections had taken place-Mr. Clark filed a notice of appeal of the district court ruling. Mr. Clark had not participated as a friend of the court in the appeals process, nor in a subsequent and unsuccessful petition from Mr. Hagelin for an expedited rehearing and rehearing en banc.
First, the FEC argued that the appellants had failed to demonstrate a common question of law, a requirement for permissive intervention under Fed. R. Civ. P. 24.1 Among other things, Mr. Clark's complaint claimed that the CPD's debate selection criteria violated unspecified sections of the U.S. Constitution. Mr. Hagelin's complaint, on the other hand, had claimed that the CPD's criteria violated FEC regulations at 11 CFR 110.13. Further, the FEC argued that there were no common "questions of fact," as required by Rule 24(b), between Mr. Clark's and Mr. Hagelin's complaints. In addition, the FEC said that the Clark appellants had not shown an independent jurisdictional basis for their claims. The would-be plaintiffs did not even include a presidential or vice-presidential candidate who might have claimed exclusion from the debates.
Timeliness was also at issue, the FEC argued. Rule 24(b) states that a court must consider "whether the intervention will unduly delay or prejudice the adjudication of the rights of the original parties." Because the debates were to begin shortly after the original complaints were filed, the district court set about adjudicating the matter on an expedited schedule, but Mr. Clark's motion was not filed until the last day of the briefing schedule.
Finally, the FEC argued that because the district court granted Mr. Clark the option of filing a brief as a friend of the court, it did not abuse its discretion in denying his initial motion to intervene. The appeals court found that the merits of the parties' positions were so clear that they warranted summary action. It held that the district court did not abuse its discretion in denying the appellants' motion to intervene.
1 Federal Rule of Civil Procedure 24(b) states that would-be intervenors must timely file their applications and demonstrate that their claim or defense and the "main action" have a question of law or fact in common. In addition, they must show an independent jurisdictional basis for their claims.
Source: FEC Record --
May 1997 [PDF].
In a suit filed in 1976, Ramsey Clark, former candidate in the New York State Senate primary election, asked the U.S. District Court of the District of Columbia for declaratory and injunctive relief against those provisions in the Act governing legislative review of the rules, regulations and advisory opinions of the FEC. Under these provisions, regulations proposed by the Commission may not be prescribed until they have been before Congress for 30 legislative days, during which time either house may disapprove them.
Clark argued that the "one-house veto" violated the constitutional principle of "separation of powers." Further, he asserted, regulations would be tainted by congressional influence on the Commission's decision-making process. He also claimed the procedure delayed promulgation of Commission regulations, thereby denying him, as voter and as candidate, protection of the Act.
Intervening as a plaintiff on behalf of the Executive Branch, the Attorney General also requested an injunction against the "one-house veto," arguing that it intrudes "upon those areas reserved by the Constitution of the United States to the Executive Branch.... "
The Federal Election Commission asked the court to dismiss the complaint, arguing inter alia, the case was not ripe for court action since Congress had not disapproved any regulation and the plaintiff had claimed no hardship resulting from compliance with the substance of a proposed regulation.
The district court certified a number of constitutional questions to the court of appeals. Concluding that the matter was not "ripe" for adjudication, the court of appeals, in a 6-2 decision on January 21, 1977, returned the certified questions to the district court unanswered, with instructions to dismiss. The court said that Clark 's case, based on his status as a candidate, became moot when he failed to win the primary in New York. As a voter, Clark had neither protested a specific veto action by Congress nor identified any proposed regulation tainted by the threat of veto or review. With respect to the constitutional issue raised by the one-house veto, the court held the case was "unripe" because congressional disapproval of a proposed regulation had not yet occurred. "Until Congress exercises the one-house veto," the Court said, "it may be difficult to present a case with sufficient concreteness as to standing and ripeness to justify resolution of the pervasive constitutional issue which the one-house veto provision involves."
On June 6, 1977, the Supreme Court of the United States affirmed the lower court's decision.1
1 The Court eventually found the one-house veto to be unconstitutional in Immigration and Naturalization Service v. Chadha, 462 U.S. 919 (1983).
Source: FEC Annual Report 1977, p. 19.
Clark v. Valeo, 559 F.2d 642 (D.C. Cir.) (per curiam),
aff'd mem. sub nom. Clark v. Kimmit, 431 U.S. 950 (1977).
On May 20, 1996, the U.S. District Court for the District of Maine invalidated the FEC's regulations on voting records and voter guides because they regulate issue advocacy and therefore go beyond the FEC's authority.
On June 6, 1997, the U.S. Court of Appeals for the First Circuit declared invalid two parts of those regulations. The court declared the voting record regulation at 11 CFR 114.4(c)(4) invalid only insofar as the FEC may purport to prohibit mere inquiries to candidates and the voter guide regulation at 11 CFR 114.4(c)(5) invalid only insofar as it limits contact with candidates to written inquiries and replies and imposes an equal space and prominence restriction.
The plaintiffs petitioned the court for a rehearing in this case, but that petition was denied on June 27, 1997. The FEC filed a petition for rehearing and suggestion for rehearing en banc on July 21, 1997.
On February 23, 1998, the Supreme Court denied Maine Right to Life Committee's petition for certiorari in this case.
On April, 30, 1998, on remand from the appeals court, the district court declared the Commission's "electioneering message" provisions of its regulations governing voting guides to be invalid because they were inseverable from those struck down by the appeals court.
The Maine Right to Life Committee (MRLC) is a nonprofit membership corporation established for the purpose of advocating pro-life stances. MRLC uses its corporate funds to create and distribute to its members and the general public voter guides and voting records. Robin Clifton is a Maine voter who wishes to receive this information.
FEC regulations at 11 CFR 114.4(c)(4) and (5) make it illegal for a corporation or labor organization to distribute voting records or voter guides to the general public if such materials expressly advocate the election or defeat of a clearly identified candidate or if the organization consults or coordinates with any candidates concerning the content or distribution of such materials. At 11 CFR 114.4(c)(5)(ii), the FEC lists additional restrictions for voter guides, such as prohibiting a corporate or labor organization from contacting a candidate (except through written questions to which a candidate may respond in writing) and requiring the organization to give all candidates for a particular office an equal opportunity to respond.
MRLC argued that the regulations were too restrictive, exceeding the FEC's statutory power and chilling First Amendment rights. The FEC contended that it had the authority to regulate corporate expenditures for voting records and voter guides if there was coordination with a candidate about the preparation, contents and distribution of such materials.
The court pointed out that the ban on direct corporate contributions had been upheld by the U.S. Supreme Court in Buckley v. Valeo on the grounds that the government's interest in preventing corruption or its appearance outweighs First Amendment concerns. On the other hand, based on the Supreme Court's opinions in Buckley and FEC v. Massachusetts Citizens for Life, Inc. (MCFL), the court said that corporate spending cannot be limited unless it expressly advocates the election or defeat of a particular candidate. "In other words," the court concluded, "spending on issue advocacy... cannot be limited." The question the court addressed was whether a corporation's contact with a candidate when preparing a voter guide or voting record would transform permissible issue-advocacy spending into a prohibited contribution.
To answer the question, the court examined two provisions of the Federal Election Campaign Act (the Act). In §441a, the Act sets dollar limits on contributions, and for this purpose "contribution" is defined to include "expenditures made by any person in cooperation, consultation, or concert, with, or at the request or suggestion of, a candidate, his authorized political committees, or their agents." 2 U.S.C. §441a(a)(7)(B)(i).
The other provision, §441b, prohibits corporate "contributions" and "expenditures," which are defined to include "any direct or indirect payment...or anything of value" provided "to any candidate...in connection with any [federal] election." 2 U.S.C. §441b(b)(2). The district court cited the MCFL Court 's interpretation of Section 441b as prohibiting payments (including indirect payments) made "on behalf of candidates." The district court stated: "That is the statutory and interpretive language on which the FEC's new regulations must be based."
The court said that the FEC, in relying on Section 441a as its authority for the challenged regulations, had "misinterpreted the Supreme Court's teachings." The district court pointed out that, in Buckley, the Supreme Court upheld the dollar limitations on contributions because limits on amounts given to a candidate are not the same as limits on direct political speech. "Here," the district court said, "both the disbursements and the speech are direct political speech by the MRLC, not by the candidate. They are thus at the heart of the [Supreme] Court's First Amendment concerns." (Emphasis in original.)
The court concluded that the FEC had based the challenged regulations on too broad an interpretation of the §441b prohibition on corporate expenditures. The court said that the voter guide regulations mistakenly hinge on whether a corporation has had any contact with a candidate rather than on whether the voter guide conveys issue advocacy on behalf of a candidate (which would be an acceptable interpretation). Under the voting record regulations, MRLC would be in violation of §441b if it included an explanation solicited from a candidate concerning apparent inconsistencies in his or her voting record. The court stated: "...it is a distortion of the English language to say that [such an activity] would turn the MRLC's publication...into spending 'on behalf of' a candidate."
In concluding that the FEC had overstepped its authority in promulgating 11 CFR 114.4(c)(4) and (5), the court pronounced that, "as long as the Supreme Court holds that expenditures for issue advocacy have broad First Amendment protection, the FEC cannot use the mere act of communication between a corporation and a candidate to turn a protected expenditure for issue advocacy into an unprotected contribution to the candidate."
The appeals court found that to avoid First Amendment concerns, it would construe 2 U.S.C. §441b narrowly. Under this construction, both the Commission's restriction on oral contact between MRLC and candidates and its insistence that voter guides provide equal space to candidates were unlawful.
The appeals court found that the FEC's requirement of equal space was a "content-based" restriction because it would affect the content of the MRLC's voting guides. The court said that "[T]here is a strong First Amendment presumption against content-affecting government regulation of private citizen speech, even where the government does not dictate the viewpoint." The court cited a case where the Supreme Court struck down Florida's "right of reply" statute, which guaranteed political candidates equal space to reply to criticism printed in the Miami Herald.1
With regard to the Commission's requirement that contact between corporations and candidates be limited to written communications when such corporations are preparing voter guides, the court said that the regulation treads "heavily upon the right of citizens, individual or corporate, to confer and discuss public matters with their legislative representatives or candidates for such office." The court said that such a ban on communications served as a "handicap" for discourse between legislators-and would-be legislators-and those they wish to represent.2
With respect to both regulations, the court rejected the FEC's argument that such restrictions were justified to prevent illegal corporate contributions to candidates. While the court acknowledged the Commission's legitimate concern with uncovering prohibited contributions, it said that the agency should be able to investigate such impermissible actions through its enforcement proceedings.
The court did not take up MRLC's challenge to the regulation concerning "electioneering message" and instead referred the matter back to the district court. The court concluded that at the district court level there had been inadequate briefing as to the content, purpose and severability of these regulations.
The district court declared the Commission's "electioneering message" provisions of its regulations governing voting guides to be invalid because they are inseverable from those struck down by the appeals court. The sections in question-11 CFR 114.4(c)(5)(ii)(D) and (E)-state that voter guides prepared on the basis of written responses from candidates to questions posed by a corporation or labor organization (1) must not include an "electioneering message" and (2) may not score or rate the candidates' responses in a way that conveys an "electioneering message."
Both the Commission and Clifton agreed that the "electioneering message" provisions were not severable from the portions of the FEC's voter guide regulation that had been declared invalId.
On February 23, 1998, the Supreme Court denied Maine Right to Life Committee's petition for certiorari in this case.
1 Miami Herald Publishing Co.
v. Tornillo, 418 U.S. 241, 256 (1974).
2 In a dissenting opinion, Senior Circuit Judge Hugh
H. Bownes wrote that the written-contact-only regulation does not infringe
on the First Amendment. Citing Buckley v. Valeo, the judge said that
the Supreme Court had acknowledged that some governmental interests outweigh
the possibility of constitutional infringement. He wrote: "At this stage of
American history, it should be clear to every observer that the disproportionate
influence of big money is thwarting our freedom to choose those who govern
us. This sad truth becomes more apparent with every election. If preventing
this is not a compelling governmental interest, I do not know what is."
Source: FEC Record -- July
1996 [PDF]; August 1997 [PDF];
and July 1998 [PDF].
Clifton v. FEC, 927 F. Supp. 493 (D.Me. 1996), 114 F.3d 1309 (1st
Cir. 1997), cert. denied, 118 S. Ct. 1036 (1998).
On May 8, 2000, the Committee for a Unified Independent Party and other plaintiffs (collectively the Committee) asked the U.S. District Court for the Southern District of New York to find that the FEC's debate regulations are not authorized by the Federal Election Campaign Act (the Act) and violate the First and Fifth Amendments to the Constitution.
The regulations in question, 11 CFR 110.13 and 114.4(f), permit nonprofit corporations to stage candidate debates and to accept donations from corporations and labor unions to defray the costs of those debates. This exemption from the general prohibition against corporate and union contributions and expenditures is based on a statutory provision that permits "nonpartisan activity (by corporations or unions) designed to encourage individuals to vote or to register to vote." 2 U.S.C. §431(9)(B)(ii).
The Committee argued that debates are not "nonpartisan activity designed to encourage individuals to vote or to register to vote" and are therefore not authorized by the Act. Further, even if debates were considered exempt nonpartisan activity, the FEC's regulations unlawfully expand the statutory exemption to permit debates that are neither nonpartisan nor designed to encourage voting. Rather, the debate regulations permit corporations and unions to make prohibited contributions to influence federal elections.
The Committee further contended that the debate regulations "tilt the electoral playing field so as to put minor parties . . . and persons and organizations seeking to promote a democratic multiparty electoral process, at a competitive disadvantage" in violation of the First and Fifth Amendments to the U.S. Constitution.
On October 10, 2001, the court granted the Commission's motion to dismiss this case, finding that the Committee lacked standing to challenge the Commission's debate regulations. In order to have standing to bring a case in federal court, the plaintiffs must satisfy a three-part test. The plaintiffs must:
In this case, the court found that the plaintiffs that were political parties lacked standing because they either were not injured as a result of the regulations or could not trace their injury directly to the regulations. Likewise, the CUIP, an organization interested in sponsoring multilateral debates, could not show an injury that was traceable to the debate regulations. The court also found that the plaintiffs who were individual voters, minor party supporters or former candidates lacked standing to challenge the regulations. Having found that Plaintiffs lacked standing, the court ordered the case closed without considering the merits of Plaintiffs' claims.
Source: FEC Record --
July 2000 [PDF]; and December 2001
[PDF].
On April 30, 1980, the U.S. District Court for the District of Columbia granted summary judgment in two cross motions filed by parties to the suit, Common Cause v. FEC (Civil Action No. 78-2135).
Common Cause had filed its motion for summary judgment in November 1978, requesting that the court rule the FEC had acted contrary to law in failing to take final action on Common Cause's administrative complaint within 90 days of its being filed. 2 U.S.C. §437g(a)(9)(B)(ii). In its complaint, Common Cause had asserted that the American Medical Political Action Committee (AMPAC), the separate segregated fund of the American Medical Association (AMA), and the state political action committees of AMA's state affiliates constituted a single political committee by virtue of their affiliation. 2 U.S.C. §441a(a)(5). Therefore, alleged Common Cause, AMPAC and its affiliated state PACs shared a single contribution limit of $5,000 per candidate, per election. Common Cause's complaint listed numerous instances in the 1976 Congressional elections where the combined contribution of AMPAC and an affiliated state PAC to a candidate had exceeded the $5,000 limit.1
At the time Common Cause filed its motion for summary judgment, the Commission had entered into conciliation agreements only with AMPAC and a few of the state PACs named in the June 1978 complaint. By fall of 1979, however, the Commission had entered into separate agreements with an additional five state PACs; between Fall 1979 and Spring 1980 the Commission entered into agreements with eleven other state PACs and was preparing to enter into 10 additional agreements. The court also noted that in February 1977 the Commission had broadened the scope of its initial investigation to include all of the AMA's state affiliates and their PACs. Moreover, the Commission had begun investigating four additional complaints which also alleged violations of the Act's contribution limits by AMPAC and its affiliated state PACs.
Common Cause nevertheless maintained that the FEC had acted contrary to law in not taking final action on its complaint within 90 days. The FEC, on the other hand, viewed the 90-day provision as jurisdictional, giving the court power to decide after the 90-day period whether or not the Commission had acted contrary to law.2
In addition to supporting the FEC's interpretation of the 90-day provision, the court noted that the determination of whether AMPAC and its state PACs were affiliated (i.e., whether they had been established, financed, maintained or controlled by the same entity) was a factual question requiring proof provided by extensive investigation. Therefore, the court did not find the FEC's efforts to collect further evidence to be an abuse of discretion. Moreover, the court found that the FEC's decision not to investigate combined contributions by state PACs affiliated with AMPAC (in addition to the combined AMPAC-State PAC contributions it had investigated) was not contrary to law since Common Cause had mentioned only one such occurrence among the 69 violations it had cited. The court did, however, order the Commission to either enter into conciliation agreements with the ten remaining respondents named in Common Cause's complaint within 30 days of the court's ruling or bring suit against them. The Commission did enter into conciliation agreements with the remaining respondents, and the court issued an order on June 13, 1980, dismissing the case.
1 While this decision was pending, the court
issued an order on August 10, 1979, directing the Commission to release to
the plaintiff certain internal FEC communications regarding the administrative
enforcement action that had been triggered by Common Cause's complaint. Among
other things, the court ordered the documents to be released under court seal,
and access to them was to be restricted to plaintiff's counsel and to senior
officers of Common Cause. Disclosures to outside parties (including the respondents
in the FEC enforcement action) were prohibited until a further order of the
court. 83 F.R.D. 410 (D.D.C. 1979).
2 In 1979 Congress amended §437g, expanding
the period in which the Commission must act on a complaint from 90 days to
120 days.
Source: FEC Record -- August 1980, p. 8.
Common Cause v. FEC, 82 F.R.D. 59 (D.D.C.), 83 F.R.D. 410 (D.D.C.
1979), 489 F. Supp. 738 (D.D.C. 1980).
On June 10, 1983, the U.S. District Court for the District of Columbia approved dismissal of Common Cause's suit against the FEC (Civil Action No. 83-0720). Common Cause requested the dismissal because, on May 23, 1983, the FEC had taken final action on the administrative complaint which had precipitated the suit.
Pursuant to 26 U.S.C. §437g(a)(8)(A), Common Cause had asked the district court to issue an order directing the Commission to take final action, within 30 days, on a complaint Common Cause had filed on September 26, 1980.1 In its administrative complaint, Common Cause had alleged that five political committees had made independent expenditures on behalf of the 1980 Republican Presidential nominee which were in violation of 26 U.S.C. §9012(f).2 (This provision prohibits unauthorized committees from making expenditures exceeding $1,000 to further the election of a publicly funded Presidential nominee.)
Alleging that the committees were not, in fact, independent of the official Reagan campaign, Common Cause had claimed that the committees' activities also resulted in violations of:
1 This complaint was merged with a similar
one filed several months earlier by the Carter-Mondale Reelection Committee
and the Democratic National Committee.
2 On July 15, 1980, the FEC filed suit in the
district court against three of the committees named in Common Cause's complaint.
The FEC sought the court's declaratory judgment that the committees' proposed
expenditures were in violation of 26 U.S.C. §9012(f) and that the provision
was constitutional as applied to the committees' expenditures. On August 28,
1981, the court ruled that section 9012(f) was unconstitutional as applied
to the defendant committees. On January 19, 1982, the Supreme Court voted
4 to 4 on the issue. While this split vote left the district court decision
intact, the Court itself made no ruling on the constitutionality of the provision.
Source: FEC Record -- May 1983, p. 7; and August
1983, p. 8.
On December 31, 1986, the United States District Court for the District of Columbia declared that the FEC's dismissal of an administrative complaint filed in 1980 by Common Cause was, in part, contrary to law. (Civil Action No. 83-2199.) The case was remanded to the FEC for action consistent with the court's opinion.
On March 15, 1988, the U.S. Court of Appeals for the District of Columbia Circuit reversed the decision by the district court. (Common Cause v. FEC, Civil Action No. 87-5036). The appeals court found "entirely permissible" the interpretation of 2 U.S.C. §432(e)(4) that the FEC had applied to allegations contained in Common Cause's complaint. The appeals court also vacated the district court's order remanding the case to the Commission for a statement of reasons concerning the FEC's tie-vote dismissal of an allegation in the complaint and instructed the district court to enter an order dismissing the suit.
The original complaint alleged that five unauthorized political committees, which supported Ronald Reagan's 1980 campaign committee, had violated the Act by using Reagan's name in their respective names. Furthermore, it was alleged that the committees involved in the complaint had impermissibly coordinated their "independent expenditures" with the official Reagan committee and, by doing so, had made contributions which exceeded the committees' limits. The five committees named in the complaint were: Americans for an Effective Presidency (AEP), Americans for Change (AFC), North Carolina Congressional Club1 (NCCC), Fund for a Conservative Majority (FCM) and National Conservative Political Action Committee (NCPAC). After investigating the majority of the claims, the FEC voted to close the file regarding the administrative complaint and take no further action.
In its suit, filed August 1, 1983, Common Cause alleged that the FEC had wrongfully dismissed the complaint.
The first legal issue addressed by the court was Common Cause's allegation that AFC, FCM and NCPAC violated the Act (2 U.S.C. §432(e)(4)) by using the name of a candidate, Ronald Reagan, in their respective committee names. Under the Act, only an authorized committee may use a candidate's name in its name. In this case, the committees involved were not authorized by any candidate. Evidence revealed that each committee had used the name "Reagan" in its respective fundraising project when soliciting funds and otherwise communicating with the public. The FEC argued that, because the official registered names of the committees did not contain Reagan's name and that the use of "Reagan" was merely for the purpose of identifying a particular fundraising project, the Act had not been violated.
In its opinion, the court noted that the name of the committee which is presented to the public for identification constitutes a "name" within the meaning of the Act and, therefore, the decision by the FEC to dismiss the complaint was contrary to law. Further, the court ordered the Commission to conform with its opinion within 30 days, pursuant to 2 U.S.C. §437g(a)(8)(c).
In the original administrative complaint, by a vote of 3-3, the FEC reached no conclusion as to whether there was reason to believe AEP and NCCC had coordinated their expenditures with the official Reagan campaign. (With regard to the other three committees, the Commission did find "reason to believe" and did conduct an investigation. See below.) This decision, which resulted in an automatic dismissal of this portion of the complaint, was contrary to the recommendation made by the FEC's General Counsel. Moreover, the Commission submitted no explanation for its decision.
The court stated that some explanation of the FEC's reasons for dismissing the complaint was warranted to enable the court to review the original determination on the issue. As a result, the court ruled that the FEC's action was arbitrary and capricious and required the agency to provide an explanation for its action within 30 days.
The final issue addressed by the court concerned Common Cause's allegation that the FEC, after investigating expenditures by AFC, FCM and NCPAC, acted contrary to law by dismissing the complaint. In the original complaint, it was alleged that all of the committees had "coordinated" their expenditures with those of the official Reagan campaign and had, thereby, made contributions-rather than independent expenditures. These contributions, according to Common Cause, exceeded the limitations contained in the Act, under 2 U.S.C. §441a(a). (There are no limits on independent expenditures.)
In its suit, Common Cause contended that a determination of coordination should be based on the "totality of circumstances." According to Common Cause, the FEC should have considered circumstances such as interlocking membership of persons at the policy-making level, prior alliances with the official committees and the use of common vendors by the committees. The FEC argued, however, that evidence of "direct coordination" was a necessary prerequisite to a determination of "impermissible coordination," and it found no evidence of direct coordination.
The court concluded that the FEC's interpretation of what constitutes "impermissible coordination" was not contrary to the law. Moreover, the court noted that, absent evidence of express intent or communication, "it is difficult to state exactly what combination of circumstances would prove that coordination had occurred." Therefore, in this issue, the court ruled that the FEC's action was proper.
In reversing the district court's ruling, a three-judge panel of the appeals court affirmed the FEC's interpretation of Section 432(e)(4), that is, that a political committee's "name" refers only to the official or formal name under which the committee must register. The court held that the "sparse legislative history of Section 432(e)(4) shows nothing definitive to undercut the Commission's consistent interpretation of this provision as applying only to the official name of a political committee." The court therefore concluded that, while Common Cause's interpretation of the provision was "not totally implausible," it did not "preclude the Commission's quite plausible alternative. There is, in short, a genuine ambiguity in Section 432(e)(4)'s text."
Further, considering the structure of the statute, the appeals court agreed with the FEC's argument that "name" should be similarly defined in Sections 432(e)(4) and 433(b)(1). (Section 433(b)(1) requires unauthorized committees to register one official name with the FEC.) The court held that these two provisions, along with the Act's disclaimer provision (Section 441d(a)), allowed the Commission "to establish a coherent means by which readers and potential contributors can find out the identity and status of those who are soliciting them."
In dissenting from the majority decision on the "name" issue, Judge Ruth B. Ginsburg argued that "Congress enacted Section 432(e)(4) to avoid public confusion and to increase public awareness of the sources of campaign messages.... Sensibly and purposively construed, the Section 432(e)(4) prohibition covers not only the formal, registered name of a political committee, but also the name the committee actually uses to identify itself in communications with the public purporting to solicit contributions for, or on behalf of, a candidate."
Finally, the appeals court reversed the district court's ruling that the FEC's deadlock vote dismissal of other allegations against two political committees must be remanded for a statement of reasons. The appeals court concluded that its recent ruling in Democratic Congressional Campaign Committee (DCCC) v. FEC (Civil Action No. 86-5661) was applicable to the circumstances of Common Cause's case. In DCCC v. FEC, the court found that the FEC's dismissal of an administrative complaint as the result of a deadlock vote was subject to judicial review. Consequently, the court could require the FEC to supply a statement of reasons for such dismissals.
Nevertheless, the court declined to "apply the precedent retroactively to this case, which arose before our DCCC decision...To do so, in this case at least, would be an exercise in futility and a waste of the Commission's resources." The court added, however, that it would "enforce the DCCC rule with respect to all Commission orders of dismissal based on deadlock votes that are contrary to General Counsel recommendations issued subsequent to our decision in that case."
1 NCCC has subsequently become the National Congressional Club.
Source: FEC Record -- February 1987, p. 6; and
May 1988, p. 7.
Common Cause v. FEC, 655 F. Supp. 619 (D.D.C. 1986) rev'd, 842 F.2d
436 (D.C. Cir. 1988).
On June 25, 1986, the U.S. District Court for the District of Columbia issued an opinion in Common Cause v. FEC, a suit in which Common Cause challenged the FEC's dismissal of an administrative complaint, which the organization had filed with the Commission in September 1984 (Civil Action No. 85-0968). In remanding the suit to the FEC, the court ordered the agency to provide: (1) an explanation of the legal standard that the agency had used in making its decision to dismiss the complaint and (2) a statement of reasons demonstrating how the FEC had applied this legal standard to the facts before it.
On August 24, 1984, one day after accepting the Republican Party's Presidential nomination, President Reagan addressed a convention of the Veterans of Foreign Wars (the VFW) in Chicago. During his speech, Mr. Reagan did not expressly mention his candidacy; nor did he solicit contributions to his campaign. Since the Reagan administration viewed the Chicago trip as official business, the administration allowed the government to absorb the travel costs and did not report them to the FEC.
On September 20, 1984, Common Cause filed an administrative complaint with the FEC against the Reagan-Bush '84 General Election Committee (the Reagan campaign), President Reagan's principal campaign committee for the 1984 general election. In the complaint, Common Cause alleged that the travel costs related to President Reagan's Chicago speech constituted "qualified campaign expenses" incurred for Mr. Reagan's publicly funded general election campaign.2 Consequently, Common Cause claimed that the Reagan campaign had to: (1) pay for and report the costs of the Chicago trip as "qualified campaign expenses" and (2) reimburse the government for using a government airplane to make the trip. On December 24, 1984, the FEC's General Counsel recommended that the Commission find "reason to believe" that the Reagan campaign and its treasurer had violated provisions of the election law and public funding statutes by failing to report these expenses. On January 15, 1985, however, the Commission decided, by a four to two vote, to find "no reason to believe" the Reagan campaign and its treasurer had violated federal election laws. Consistent with past practice, the Commission did not issue a formal statement of reasons for its decision to dismiss Common Cause's administrative complaint.
On March 22, 1985, Common Cause challenged the FEC's dismissal decision by filing suit against the Commission with the district court. In its suit, Common Cause asked the court to declare that the FEC's dismissal of its administrative complaint was contrary to law and to order the agency to act on the allegations in its complaint.
In arguing that the FEC's dismissal was contrary to law, Common Cause said that, in determining whether President Reagan's Chicago trip was campaign related, the Commission should have considered the "totality of circumstances" surrounding his Chicago speech rather than using a narrower review standard, which focused solely on: (1) whether President Reagan's speech expressly advocated his reelection and (2) whether he solicited contributions in conjunction with his speech.
Although accepting the legal standard which the parties agreed had been applied by the FEC in its dismissal of Common Cause's complaint, the court observed that it still had to "determine whether the agency has presented a rational basis for its decision." In this regard, the court noted that "the record before us prevents that threshold determination." The court therefore remanded the case to the FEC "both for an explanation of the legal standard actually applied and...a statement of reasons demonstrating how the Commission applied such legal standards to the facts before it."
In response to the court's second remand order, Commissioners Joan D. Aikens and John W. McGarry submitted a joint statement of reasons, while Commissio