United States Defense Committee v. FEC
On April 12, 1988, the U.S. District Court for the Northern District of New York entered an order granting summary judgment to the FEC in United States Defense Committee (USDC) v. FEC (Civil Action No. 84-CV-450).
In a decision of November 7, 1988, the U.S. Court of Appeals for the Second Circuit held that the USDC's complaint against the FEC was not ripe for the court's review. The appeals court therefore remanded the case to the U.S. District Court for the Northern District of New York with instructions for the district court to dismiss the case.
In those opinions, the Commission expressed the view that corporate treasury expenditures for certain voter guides which USDC proposed to compile and distribute to the general public were not exempted under Part 114 of FEC regulations. Consequently, the voter guides were prohibited by 2 U.S.C. §441b because, as drafted, the language of the guides suggested an election-influencing purpose. (Taken together, these legal provisions prohibit corporations, labor organizations and incorporated membership organizations from distributing to the general public voter guides that favor one candidate or political party over another.)
In response to the opinions, USDC asked the court to declare that USDC's proposed expenditures were not proscribed by FEC regulations. USDC also raised three constitutional questions concerning its distribution of the voter guides. For example, USDC asked the court to consider whether 441b abridged its First and Fifth Amendment rights by discriminating between incorporated organizations like USDC and the institutional press. (Costs incurred by news media corporations for bona fide coverage of political events are exempt from the election law's broad prohibition on corporate expenditures, provided the news corporation is not owned or controlled by any political party, political committee or candidate.)
District court decision
In a statement read into the public record, the district court judge presiding in this case held that the court had jurisdiction to review USDC's complaint. While the court acknowledged that the election law did not specifically provide for judicial review of FEC advisory opinions, the court found that its authority to review the complaint had not been "explicitly restricted by statute or by Congress...."
In ruling on the merits of the case, the court rejected USDC's claim that the election law discriminates against USDC by permitting the institutional press to disseminate information on political candidates to the general public while prohibiting USDC from disseminating information in the form of voter guides. The court held that the press exemption had a "valid basis" in that it recognizes the need for informing the public on federal election-related issues. Further, the press is not covered by this exemption when it exceeds its legitimate press function. The court also rejected USDC's argument that the guides were not covered by the 441b prohibition because they did not include an explicit request for the recipients to vote one way or another.
Finally, the court held that the Supreme Court's decision in FEC v. Massachusetts Citizens for Life, Inc. (MCFL), (Civil Action No. 85-701) did not exempt USDC from 441b's prohibition against corporate expenditures in connection with federal elections. To be eligible for the MCFL exception, among other things, a nonprofit corporation must have a policy of not accepting contributions from business corporations or labor organizations. Since USDC had accepted money from its corporate members, the court found that the organization was not eligible for the MCFL exception.
USDC subsequently filed an appeal of the district court's decision with the U.S. Court of Appeals for the Second Circuit.
Appeals court decision
In deciding that USDC's case was not ripe for judicial review, the appeals court said that nothing in the legislative history indicated that Congress thought advisory opinions were reviewable. Further, the appeals court explained that an FEC advisory opinion was not "final or binding.... " In this regard, the court noted that "if a person proceeded to act contrary to an FEC advisory opinion, [that person] would be entitled to all of the enforcement protections, including conciliation, conference, persuasion and the like, provided under 2 U.S.C. §437g."
The appeals court further noted that AO 1987-7 was "particularly inappropriate for judicial resolution at this time. As a consequence of the Supreme Court's decision in FEC v. Massachusetts Citizens for Life the Commission is engaged in a rulemaking proceeding which could alter the very regulations applied in the opinion."
On remand, the district court dismissed the case.
Source: FEC Record — July 1988, p. 6. United States Defense Committee, Inc. v. FEC, No. 84-CV-450 (N.D.N.Y. April 27, 1988) (unpublished order), vacated and remanded, 861 F.2d 765 (2d Cir. 1988).