Appellate Court Decision in Van Hollen v. FEC Disclosure Litigation

The D.C. Circuit Court of Appeals issued an opinion today overturning a lower court holding that invalidated the Federal Election Commission’s (“FEC”) regulations governing the disclosure of of donors by groups sponsoring electioneering communications in Van Hollen v. FEC.  The lower court held that the FEC regulations limiting the disclosure of donors by groups sponsoring electioneering communications were contrary to law under the Administrative Procedure Act.  After the lower court’s decision, the FEC issued a press release, yes a press release and not a rulemaking or a policy statement, implementing the lower court decision. 

Well, today’s appellate court decision contains some interesting statements that should spark robust debates in campaign finance circles. 

First, the court states that it cannot divine the FEC’s position on fundamental issues in the case because the FEC did not participate as a party to the appeal.  Specifically, the court stated:

The FEC’s failure to participate in this appeal makes it impossible for the court to fully understand the agency’s position on numerous issues that have been raised by the parties with respect to the meaning of the statute, the intended reach of the disputed regulation, and the import of the Supreme Court’s decisions addressing campaign finance law.

Today’s decision by the federal appellate court reverses the lower court’s decision, vacates the summary judgment handed down by the lower court in favor of Congressman Van Hollen, and remands the case to the District Court.  The District Court must now refer the matter to the FEC for further consideration.  The FEC can either initiate a new rulemaking or better explain the meaning and scope of the challenged regulation. 

The court has placed the ball squarely in the FEC’s court.  In all likelihood, however, this issue will not be resolved anytime soon by the FEC and it remains to be seen whether the FEC will issue any press releases or other guidance in the wake of today’s developments.  The issues in this case are important.  The regulated community is entitled to clear guidance from the FEC, especially since it did not participate in the appeal.  With less than two months to go before the November general election, the Commission now has the obligation to publish clear guidance so that groups sponsoring advertisements subject to the disputed regulation have clear notice concerning the disclosure requirements.

Second, the appellate court signaled that the FEC needs to explain this regulation in the wake of the recent Supreme Court campaign finance decisions that have changed the political ecosystem.

After reviewing the record with care, we conclude that the District Court erred in holding that Congress spoke plainly when it enacted 2 U.S.C. 434(f), thus foreclosing any regulatory construction of the statute by the FEC.  The statute is anything but clear, especially when viewed in the light of the Supreme Court’s decisions in Citizens United v. FEC, and FEC v. Wis. Right to Life, Inc.  (citations omitted)

The court’s reference to Citizens United is an interesting one in light of the fact that the FEC has failed to adopt a rulemaking implementing the Supreme Court’s holding in that case.  It’s also interesting since the Citizens United decision was handed down approximately three years after the challenged FEC regulation was adopted.  Interesting tea leaf for folks who follow these matters.

 Finally, the court’s decision poses another interesting question that should not go unnoticed.  Specifically, the court wonders:

The FEC promulgation of 11 C.F.R. 104.20(c)(9) reflects an attempt by the agency to provide regulatory guidance under the BCRA following the partial invalidation of the speech prohibition imposed on corporations and labor unions in the context of “electioneering communications.”  Unfortunately, the parties arguments in this case have revealed, the angency’s adoption of section 104.20(c)(9) has raised as many questions as it purported to resolve.  For example, neither the court nor the parties understand the reference to 11 C.F.R. 114.15 in section 104.20(c)(9).

11 C.F.R. 114.15 is the regulation setting forth the definition of a permissible electioneering communication and an electioneering communication in the wake of the WRTL II.  Could the court be signalling that permissible electioneering communications, which under the Supreme Court’s holding are issue ads and not campaign-related, be subject to lesser or no disclosure requirements, or should they somehow be treated in an entirely different manner?  This will be an interesting issue to watch as this matter unfolds.

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“Twitter Becomes A Key Real-Time Tool For Campaigns”

The Washington Post published an interesting article concerning the role Twitter plays in campaigns and grassroots lobbying.

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FEC Update

The Federal Election Commission released the Weekly Digest for the week of April 16-20, 2012.

I know it has been a while since my last post so here are some articles discussing the federal district court’s decision in Van Hollen v. FEC, one of the reformers’ efforts to impose greater regulations on political speakers.

Campaign Donor Advertising Rule Invalidated By U.S. Judge, Bloomberg

FEC Ruling Leaves Ad Uncertainty, Roll Call

Also, an interesting FEC advisory opinion request was filed by an organization called Free Speech.  The request, identified as FEC AOR 2012-11, seeks guidance from the Commission regarding whether the organization is a political committee that is required to register and report to the FEC and whether specific ads constitute express advocacy.  This is one to watch.

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“Outside Groups Plan To Focus On Air War, Ground Game In 2012 Election Fight”

Interesting report from the Washington Post.

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Committee on House Administration To Hold FEC Oversight Hearing

The Subcommittee on Elections of the Committee on House Administration (“House Elections Committee”) is scheduled hold an oversight hearing on the Federal Election Commission on November 3, 2011.  The link to the House Elections Committee webpage announcing the hearing can be found here.

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“Political Advertising Data May Go Online”

Politico reports that the station information regarding political advertising may soon be available online.  This has the potential to be an interesting development since it will make it easier for candidates, political parties, and outside groups to monitor everyone’s media buys.

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“Presidential Campaigns Seek Fundraising’s Holy Grail: Mobile Donations”

The Huffington Post reports on the latest efforts to develop a platform that will permit campaigns to receive contributions via a contributor’s mobile device.

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“ICANN Facing Growing Pressure Over New Domain-Name Plan”

National Journal reports on the push back by the business community regarding ICANN’s plan to expand the number of available domain names.

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“Rules of the Game: Super PACs Multiply, Head To Hill”

Eliza Carney remains concerned about Super PACs and their role in the 2012 election.

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“Campaigns Make Cash Off Donor Contact Information”

Roll Call reports on list rental income received by many federal campaigns.

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“Ex-McCain Lawyer: Barack Obama ‘Mugged’ John McCain in 2008”

Politico provides further evidence that the pro-regulation community is losing patience with Obama administration.

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“The G.O.P.’s Very Rapid Response Team”

The New York Times reports on the latest developments in the political messaging wars.

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FEC Data Update

The Federal Election Commission (“FEC”) made some substantial improvements to its website.  Among the improvements are lists from the Press Shop on various topics such as each individual who filed a statement of candidacy for President of the United States, and other types of political committees that recently registered with the FEC.  Listed below are links to a few of the lists:

New Statement of Organization (FEC Form 1) Filers

2012 Presidential Statement of Candidacy (FEC Form 2) Filers

2012 Independent Expenditure Filers

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FEC News Update

The Federal Election Commission’s Weekly Digest for the week of August 8-12, 2011 is available here.

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Republican FEC Commissioners Release Statement Of Reasons On Citizens United Rulemaking

The statement can be found here.

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