Commission statement on Van Hollen v. FEC

On March 30, 2012, the United States District Court for the District of Columbia, in Van Hollen v. FEC, Civ. No. 11-0766 (D.D.C. Mar. 30, 2012), found that the Commission regulation at 11 CFR 104.20(c)(9) is invalid. That regulation, which was adopted in 2007 and governed electioneering communications by corporations and labor organizations, required that their donors be disclosed only if their donations were “made for the purpose of furthering electioneering communications.” The district court found that this limitation on disclosure contravened Congress’s intent and noted that the Commission’s pre-2007 regulation “did not add an intent requirement.” Van Hollen, No. 11-0766, slip. op. at 25 n.8 (D.D.C. Mar. 30, 2012). On April 27, 2012, the district court vacated the regulation at 11 CFR 104.20(c)(9) and reinstated the Commission’s prior regulation at 104.20(c), which was promulgated on December 17, 2002 and was in effect until December 25, 2007. Van Hollen, Civ. No. 11-0766 (D.D.C. Apr. 27, 2012). 

Both the district court, in its April 27 ruling, and the United States Court of Appeals for the District of Columbia Circuit, Van Hollen, No. 12-5117 (D.C. Cir. May 14, 2012), denied motions by defendant-intervenors Center for Individual Freedom and Hispanic Leadership Fund to stay the district court’s order pending appeal. [FN1]   

The Commission is providing this public statement outlining how it will comply with the district court’s opinion and order pending the appeal of the case:

• Effective March 30, 2012, persons making disbursements for electioneering communications should report “the name and address of each donor who donated an amount aggregating $1,000 or more to the person making the disbursement, aggregating since the first day of the preceding calendar year.”  11 CFR 104.20(c)(8) (effective Feb. 3, 2003 to Dec. 25, 2007); Explanation and Justification for Final Rules on Bipartisan Campaign Reform Act of 2002 Reporting, 68 FR 404, 419 (Jan. 3, 2003), available at http://sers.fec.gov/fosers/viewreg.htm?regno=2002-02&docno=1024. 
  
• Until such time as the Van Hollen case is resolved on appeal or the Commission adopts a new regulation or explanation of its rules, the Commission intends to comply with the district court and D.C. Circuit’s interpretation of the words “contributor” at 2 U.S.C. §434(f)(2)(F) and “donor” and “donation” in 11 CFR 104.20(c) as follows:
  
  • “[‘Contributor’] applies to all contributors regardless of their subjective purpose in contributing.”  Van Hollen, No. 12-5117, slip op. at 4 (D.C. Cir. May 14, 2012).
  • A “contributor” is “a person who gives money without expectation of service or property or legal right in return.”  Van Hollen, No. 11-0766, slip. op. at 27 (D.D.C. Mar. 30, 2012).  Likewise, a “donor” making a “donation” is a person who is “providing something for nothing.” Id. at 25 n. 8. 
  • “Dues paid in return for the benefits of membership” are not “donations.”  Id. 
  • “[I]nvestors who pay for shares of stock” are not “donors.”  Id. 
  • “[C]ustomers who pay for goods and services” are not “donors.”  Id.

• For further guidance on 11 CFR 104.20, persons reporting electioneering communications should refer to the Commission’s Explanation and Justification for Final Rules on Bipartisan Campaign Reform Act of 2002 Reporting, 68 FR 404 (Jan. 3, 2003).

Persons with specific questions regarding their reporting obligations may contact the Reports Analysis Division at (800) 424-9350 (at the prompt, press 5). Others may contact the Information Division at (800) 424-9530 (press 6).

1 Materials related to Van Hollen v. FEC are available at https://transition.fec.gov/law/litigation/van_hollen.shtml.

Resources:

• Commission statement on Van Hollen v. FEC