FEC v. Christian Coalition

Summary

On May 13, 1997, the U.S. District Court for the District of Columbia denied the Christian Coalition's motion for partial dismissal of this case. The decision meant that the FEC was able to seek declaratory and injunctive relief for all of the alleged violations of the Federal Election Campaign Act (the Act), but was not able to obtain civil penalties for any of the violations that occurred more than five years before the lawsuit was filed.

On August 2, 1999, the district court granted in part and denied in part motions for summary judgment by both the Federal Election Commission (the "FEC" or "Commission") and the Christian Coalition (the "Coalition").

The FEC and the Christian Coalition negotiated a final judgment and order, which the court issued on February 23, 2000.

1997 district court decision

Statute of limitations

The Coalition sought dismissal of those portions of the FEC's suit that concerned prohibited activities that had occurred more than five years before the suit was filed-essentially the activities that related to the 1990 election cycle.

At 28 U.S.C. §2462, the law provides for a five-year statute of limitations for certain law enforcement proceedings. The Coalition argued that that time limit started running at the time that the alleged offenses occurred-not when they were reported to the FEC by the Democratic Party of Virginia. The FEC argued that the time began running when it was notified through the administrative complaint process. Because its investigatory powers and resources are limited, the FEC said that it had no way of knowing about the Coalition's alleged conduct until a complaint was filed with the agency.

The court rejected the FEC's argument, citing the ruling of the U.S. Court of Appeals for the District of Columbia Circuit in 3M v. Browner.[1] In that case, the appeals court ruled that an agency's failure to detect violations does not negate the inherent difficulties faced by bringing a case to court long after the alleged violation has occurred. The appeals court noted: "nothing in the language of §2462 even arguably makes the running of the limitation period turn on the degree of difficulty an agency experiences in detecting violations."

The court, however, agreed with the FEC that §2462 provides no shield for the Coalition from declaratory or injunctive relief. At 2 U.S.C. §437g(a)(6), the FEC has the authority to seek injunctive relief separate from its authority to seek legal remedies (e.g., civil fines, penalties and forfeitures).

1999 district court decision

The Commission had alleged that the Coalition had made three expenditures for communications that expressly advocated the election or defeat of clearly identified candidates. The court held that the following two communications did not contain express advocacy and, therefore, did not violate the Federal Election Campaign Act's (the "Act") ban on corporate contributions and expenditures made in connection with federal elections:

A 1992 Montana speech by Ralph Reed, then-Executive Director of the Coalition; and
A 1994 nationwide direct mail package entitled "Reclaim America."

The court held that a third communication, a 1994 mailing by the Georgia Christian Coalition, did expressly advocate the election of then-Speaker Newt Gingrich in violation of the Act. The court also held that the Coalition violated the Act by making a prohibited corporate contribution to Oliver North's Senate campaign by giving it a mailing list.

The Commission also alleged that the Coalition coordinated its voter guides during the 1990, 1992 and 1994 elections with various federal candidates. In all but one instance, the court decided that there was no coordination. In one election campaign, Oliver North's 1994 U.S. Senate campaign in Virginia , the court determined that there were contested issues to be resolved after a future hearing.

Background and holding

The Christian Coalition is a nonprofit, nonstock corporation, originally incorporated in Virginia and doing business in the District of Columbia. In 1992 both the Democratic Party of Virginia and the Democratic National Committee filed complaints against the Coalition with the FEC. The two complaints were merged. The Commission found probable cause to believe the Coalition had violated the Act and attempted conciliation with the Coalition. After that attempt failed, the Commission filed this lawsuit in 1996.

The court determined that the two main issues in the litigation were:

Whether "express advocacy" is limited to communications that use specific phrases or "magic words," such as "Vote for Smith," or whether a more substantive inquiry into the clearly intended effect of a communication is appropriate; and
What level of contact between a campaign and a corporation constitutes "coordination" and thereby converts a corporate expenditure that influences an election into a prohibited contribution.

Express advocacy

With regard to the first issue, the court concluded that an express advocacy communication is one that a reasonable person would understand contains an explicit directive-using an active verb (or its functional equivalent)-that unmistakably exhorts the audience to take electoral action to support or defeat a clearly identified candidate. The verb (or its functional equivalent) must be considered in the context of the entire communication, including temporal proximity to the election.

Corporate coordinated expenditure

With respect to the second issue, the district court limited its decision to "expressive coordinated expenditures" by corporations. The court explained that an "expressive coordinated expenditure" is an expenditure for a communication that (although not containing express advocacy) is "made for the purpose of influencing a federal election in which the spender is responsible for a substantial portion of the speech and for which the spender's choice of speech has been arrived at after coordination with the campaign." Such expenditures are coordinated if the candidate requests or suggests the expenditure, or if the spender engages in substantial discussion or negotiation with the campaign about the communication's content, timing, location, mode, intended audience or volume.

Express advocacy issues

Express advocacy standard

The FEC alleged that in three instances the Coalition used general treasury funds to finance independent communications that contained express advocacy (i.e., expressly advocated the election or defeat of a clearly identified candidate) and thereby violated §441b of the Act, which prohibits corporations and unions from making expenditures in connection with federal elections.

Based on decisions by the Supreme Court and lower courts in other jurisdictions, the district court held that, in order for an expenditure to contain express advocacy and, if made by a corporation, violate §441b of the Act, the following attributes are necessary:

The communication must contain an explicit directive. It must use an active verb or its functional equivalent (e.g., "Vote for Smith" or "Smith for Congress" or an unequivocal symbol).
The "active verb or its immediate equivalent-considered in the context of the entire communication, including its temporal proximity to the election-must unmistakably exhort the [receiver] to take electoral action to support the election or defeat of a clearly identified candidate." Electoral action includes campaigning for and/or contributing to a clearly identified candidate, as well as voting for or against the candidate.

The court said that it is a pure question of law as to whether a reasonable person would understand the communication to expressly advocate a candidate's election or defeat. Once the identity of the speaker (organization paying for the communication) and the content of the communication are proven, a court must determine whether the communication contains express advocacy "solely as a matter of law."

Ralph Reed's 1992 Montana speech

The FEC alleged that the Christian Coalition used general treasury funds to pay travel expenses and compensation to Ralph Reed, then-Executive Director of the Coalition, for a speech that expressly advocated the defeat of Pat Williams, the Democratic U.S. Representative from Montana's First District.

The court held that, while Reed's speech made references to the Democratic incumbent, it did not direct the audience to do anything. He predicted that "victory will be ours" and that "we're going to see Pat Williams sent bags packing . . . in November." The court said this was "prophecy rather than advocacy," because Reed's speech did not contain an explicit exhortation to the audience to take action to defeat Representative Williams. "[I]t can only be concluded that Reed exhibited precisely the 'ingenuity and resourcefulness' in his verb choice that the Buckley Court envisioned possible to circumvent the prohibition on express advocacy. As others have acknowledged, results such as this appear unsatisfyingly formalistic, allowing precisely the sort of communications Congress sought to prohibit to remain immune from liability. . . . But the Supreme Court felt that the First Amendment required a choice between a toothless provision and one with an overbite; results such as this flow directly from that choice."

"Reclaim America" 1994 mailing

The FEC alleged that portions of a mass mailing called "Reclaim America" included prohibited express advocacy. The Commission argued that, when read in conjunction with the enclosed Christian Coalition scorecard (rating incumbents on specific votes), the cover letter could only be understood to urge support of those incumbents rated favorably and defeat of those rated unfavorably.

Though acknowledging that the cover letter contained explicit directives (e.g., "stand together," "get organized"), the court concluded that a reasonable person could understand the cover letter as a directive to engage in lobbying or issue advocacy with all candidates. The scorecard did not identify which incumbents were candidates in 1994 and did not provide an electoral endorsement of any particular candidate. As a result, there was no express advocacy, and the expenditures did not violate §441b.

Georgia mailing in 1994

The FEC alleged that a mailing by the Georgia Christian Coalition state affiliate (for which the Coalition admitted it was responsible and liable) contained a cover letter from the Coalition's state chair expressly advocating the re-election of Congressman Newt Gingrich. The mailing also contained a copy of the Coalition's nationwide Congressional scorecard.

The court held that, unlike the other two communications discussed above, "the Georgia mailing was expressly directed at the reader-as-voter." The cover letter announced upcoming primary elections and enclosed two items "[to] help you prepare for your trip to the voting booth." The second item was the congressional scorecard. The letter stated that Newt Gingrich, a Christian Coalition "100 percenter," was the only incumbent facing a primary opponent. The letter also exhorted the voter to take the scorecard to the polls in the general election. "While marginally less direct tha[n] saying 'Vote for Newt Gingrich,' the letter in effect is explicit that the reader should take with him to the voting booth the knowledge that Speaker Gingrich was a 'Christian Coalition 100 percenter' and therefore the reader should vote for him. While the 'express advocacy' standard is susceptible of circumvention by all manner of linguistic artifice, merely changing the verb 'vote' into the noun, 'trip to the voting booth' is insufficient to escape the limited reach of 'express advocacy.'"

Coordination issues

Corporate coordinated expenditures

The court explained that §441b of the Act prohibits corporations from making any contributions or expenditures in connection with any federal election, and the Supreme Court, in Buckley v. Valeo, established that expenditures made in coordination with a campaign are contributions. The court further stated that, in FEC v. Massachusetts Citizens for Life, the Supreme Court "determined that Congress plainly intended the Act to reach corporate expenditures in connection with a federal election. . . . Under that construction, it is manifest that the Coalition's expenditures on voter guides fall within Congress's intended scope for §441b."

The district court went on to distinguish "expressive coordinated expenditures" from other coordinated expenditures. According to the court, an "expressive coordinated expenditure" is an expenditure "for a communication made for the purpose of influencing a federal election in which the spender is responsible for a substantial portion of the speech and for which the spender's choice of speech has been arrived at after coordination with the campaign." The court distinguished this type of coordinated expenditure from other types such as coordinated expenditures for noncommunicative materials (e.g., food or travel expenses for campaign staff).

The court held constitutional that portion of the FEC's regulations that would treat, as contributions, "expressive coordinated expenditures" made at the request or suggestion of the campaign. In the absence of a request or suggestion from the campaign, the court explained, an expressive expenditure is still coordinated where the candidate or his agent exercises control over the communication, or where there has been substantial discussion or negotiation between the campaign and the spender about such things as the contents, timing, location, mode, intended audience, or volume of the communication. A substantial discussion, the court explained, is one from which the spender and the campaign emerge as partners (not necessarily equal partners) or joint venturers in the expressive expenditure. "This standard limits §441b's contribution prohibition on expressive coordinated expenditures to those in which the candidate has taken a sufficient interest to demonstrate that the expenditure is perceived as valuable for meeting the campaign's needs or wants."

The court stated that, under this standard, a voter guide would be considered a coordinated expenditure if the conversation between the spender and the campaign went well beyond inquiry and included, for example, discussion or negotiation over the selection and phrasing of issues to be included in the candidate survey or voter guide. "Coordination requires some to-and-fro between corporation and campaign . . . ."

With respect to get-out-the-vote ("GOTV") telephone activity, the court held that the level of discussion must involve negotiation regarding such things as the contents of the scripts, when the calls are to be made, location or the audience-including which databases will be used to choose call recipients or the number of people to be called.

Using this standard, the court evaluated the facts surrounding the Coalition's expenditures for voter guides involving the following campaigns.

Bush/Quayle '92 Presidential campaign

The court held that the Coalition's voter guides and GOTV expenditures, in connection with the 1992 Presidential election, did not qualify as coordinated expenditures-primarily because the court concluded that the Bush/Quayle '92 campaign staff, armed with foreknowledge of the Coalition's plans, chose not to respond to the Coalition's implicit offers to discuss those plans. Although Pat Robertson (Chairman of the Board and former President of the Coalition) and Reed had special access to the Bush/Quayle '92 campaign, and Reed had extensive discussions with campaign staff regarding the campaign's thinking on strategic issues, and the Coalition told the campaign it intended to issue voter guides, "the Coalition did most of the talking." Moreover, there was no request or suggestion by the candidate that the Coalition make expenditures for the voter guides. The corporation's possession of "insider" knowledge from the campaign did not, in itself, establish coordination. More overt acts are required, the court said.

Helms for Senate 1990, Inglis for Congress 1992 and Hayworth for Congress 1994

With regard to three Congressional campaigns (Helms for Senate in 1990, Inglis for Congress in 1992 and Hayworth for Congress in 1994), the court found no coordination. In each case, someone was simultaneously involved in both the Coalition and the campaign, but the court said that such "insider trading" was not sufficient to establish coordination without more overt acts such as expenditures being made at the suggestion or request of the campaign.

North for Senate 1994

In one case, North for Senate in 1994, the Coalition gave to Oliver North's campaign a list of previous delegates to the Virginia Republican convention who were also supporters of the Coalition. The court determined that such lists have commercial value, and therefore the contribution of the list to the North campaign was a prohibited corporation contribution.

The Coalition also distributed voter guides in Virginia in 1994. However, there is a material question of fact as to whether North's campaign manager discussed with Reed which issues should be included in the voter guide. That issue, along with the fair market value of the mailing list, will be determined in later court proceedings.

National Republican Senatorial Campaign Committee

The FEC also had alleged that the Coalition had coordinated with the National Republican Senatorial Campaign Committee to create and distribute voter guides in several states the NRSC considered key in the 1990 elections. The NRSC had contributed $64,000 to the Coalition but had not become a partner in the voter guides by discussing their contents or points of distribution. The court concluded, therefore, that the Coalition had not violated the Act since there had been no discussion or negotiation with regard to the contents or distribution of the voter guides.

2000 district court decision