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CITIZENS FOR PERCY '84 v. FEC (84-2653)1

On November 19, 1984, the U.S. District Court for the District of Columbia issued an opinion in Citizens for Percy '84 v. FEC (Civil Action No. 84-2653) stating that the FEC's delay in acting on an administrative complaint filed on April 26, 1984, by Citizens for Percy '84 (the Committee) was contrary to law. (The Committee was former Senator Charles H. Percy's principal campaign committee for his 1984 reelection campaign.) The court also ordered the FEC to conform its conduct to the decision within 30 days of the court's order. See 2 U.S.C. §437g(a)(8).

Background

On August 26, 1984, the Committee had petitioned the district court to declare that the FEC's failure to act on its administrative complaint was contrary to law. See 2 U.S.C. §437g(a)(8)(A). In the complaint, the Percy campaign had claimed that media expenditures made by Michael Goland on behalf of Rep. Thomas Corcoran, Senator Percy's opponent in the Illinois Senate primary, were coordinated with the Corcoran campaign. The Percy campaign had alleged that, since the expenditures were not independent, Mr. Goland had violated the election law by making excessive in-kind contributions to the Corcoran campaign. See 2 U.S.C. §441a(a)(1)(A). Moreover, the Corcoran campaign had violated the law by accepting the contributions. See 2 U.S.C. §441a(f).

Court's Ruling

Noting that the FEC had not found reason to believe the respondent had violated the election law until October 2, 1984, more than five months after the Committee had filed its administrative complaint, the court concluded that the FEC had acted contrary to law. The court reasoned that, since Senator Percy's reelection campaign had been the "focus...of tremendous national interest," the agency did not have the discretion to give the complaint routine treatment.

1 Citizens for Percy '84 v. FEC (85-0763) was dismissed. See Antosh v. FEC (85-1410).


Source:
  FEC Record -- January 1985, p. 6.
Citizens for Percy '84 v. FEC, 2 Fed. Elec. Camp. Fin. Guide (CCH) ¶9215 (D.D.C. 1984).

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PEROT '96 and NATURAL LAW PARTY v. FEC and THE COMMISSION ON PRESIDENTIAL DEBATES

On October 4, 1996, the U.S. Court of Appeals for the District of Columbia Circuit upheld a lower court ruling that dismissed lawsuits against the FEC and the Commission on Presidential Debates (CPD). The suits had been filed by two Presidential hopefuls who, among other things, sought to participate in the Presidential debates.

The Complaints

One suit was filed by Ross Perot and Pat Choate, the Presidential and Vice Presidential candidates for the Reform Party, and Perot '96. A similar suit was filed by the Natural Law Party (NLP) and its Presidential and Vice Presidential candidates, John Hagelin and Mike Tompkins.

The two campaigns filed the suits in U.S. District Court for the District of Columbia after the CPD excluded the candidates from a list of participants for three nationally televised debates. Previously, in September, Perot '96 and the NLP had filed administrative complaints with the FEC, but, because of procedures set forth in the Federal Election Campaign Act (the Act), resolution of those complaints was not expected before the debates started in October.

Both suits contended that the CPD had violated FEC rules governing nonpartisan candidate debates at 11 CFR 113.10 and the Perot suit alleged that the CPD's acceptance of corporate donations to pay for the debates violated the Act's ban on corporate contributions at 2 U.S.C. §441b.

The Perot suit asked the court:

The NLP suit asked the court:

District Court Decision

The court combined the suits for oral argument and dismissed both cases on October 1, 1996.

The court concluded that it had no jurisdiction in the matter. First, as mandated by Congress, the FEC has exclusive jurisdiction to hear complaints alleging violation of the Act, and the plaintiffs have no private right of action against the CPD. Second, the FEC has 120 days to act on an administrative complaint before the court may become involved. 2 U.S.C. §437g.1

In addition, the court weighed the potential damage to Mr. Perot, Dr. Hagelin and their running mates from not participating in the debates and found that such damage could be partially remedied in later court proceedings-for example, before the next Presidential election four years from now-and that the damage they incurred did not "outweigh the public interest in allowing the debates to go forward without interference."

Specifically as to Mr. Perot's arguments, the court also found no likelihood of success on the merits of the claim that the CPD had violated the candidate's Constitutional rights because he had not shown that the CPD is a state actor2 or that the FEC had delegated any of its authority to the CPD. Also, the court upheld the FEC regulations at 11 CFR 110.13(a) that allow nonprofit, nonpartisan corporations to stage debates in certain circumstances and, under 11 CFR 114.4(f), to accept contributions from corporations to put on such events without the funds being considered illegal campaign contributions or expenditures.

Appeals Court Decision

Because of expedited procedures, the appeals court heard the case two days after the district court handed down its ruling. The appeals court affirmed the lower court's decision that it lacked jurisdiction to take action on the alleged violation of the Act or to order the FEC to resolve the complaints prior to the CPD-sponsored debate on October 6. In explaining this decision, the court said, "Congress could not have spoken more plainly in limiting the jurisdiction of federal courts to adjudicate claims under the FECA." The court said, "We assume that in formulating these procedures Congress...knew full well that complaints filed shortly before elections, or debates, might not be investigated and prosecuted until after the event."

The NLP's arguments that the delay would cause "irreparable harm" to its candidates and that the impending debates constituted extraordinary circumstances, requiring a waiver of the Act's procedures, were rejected by the court. Further, the court said that if it were to enjoin the CPD from carrying off the debates or selecting participants, it might risk violating the CPD's First Amendment rights.

The court also rejected Mr. Perot's allegation that the FEC had delegated its authority to the CPD by prescribing regulations that allow organizations that are staging debates to create their own "objective criteria" to determine who may participate. See 11 CFR 110.13(c). The court said, "A regulation's use of a term that may be susceptible to differing interpretations does not automatically result in a delegation of authority to entities that it governs." The court also observed that even if the FEC were to immediately revise its debate regulations (in response to the complaint), the agency could not complete the task in time for the debates. Under the Act, new regulations do not become effective until 30 legislative days after the FEC transmits them to Congress.

With regard to Mr. Perot's challenge to the debate regulations themselves, the appeals court observed that the district court had not had the benefit of the administrative record and that the issue had not been fully briefed. Consequently, the appeals court vacated the district court's decision upholding the regulation and remanded the claim to the district court with instructions to dismiss without prejudice. (Mr. Perot would then be free to file a new suit on the same issue.) In all other respects, the appeals court affirmed the district court's order.

FOOTNOTES:

1 Section 437g(a)(8) allows a complainant to file suit against the FEC only for dismissing his complaint or for failing to act on it within 120 days after the complaint was filed.
2 Only government entities (or state actors), not private groups, are subject to the Constitutional violations alleged by Mr. Perot.


Source:
  FEC Record -- November 1996 [PDF].
Perot v. Federal Election Commission, 97 F.3d 553 (D.C. Cir. 1996).

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PEROT '96 v. FEC (98-1022)

On April 12, 1999, the U.S. District Court for the District of Columbia dismissed this case with prejudice at the plaintiff's request.

Perot '96, the 1996 committee of former Reform Party Presidential candidate Ross Perot, had asked the court to find that the FEC acted contrary to law in dismissing an administrative complaint that Perot '96 had filed against the Commission on Presidential Debates (CPD). The CPD had sponsored the 1996 Presidential debates to which Mr. Perot was not invited to participate.

Perot '96 had asked the court to order the FEC to take action on the complaint or to find that the agency's regulations governing nonpartisan candidate debates were unconstitutional. 11 CFR 110.13 and 114.4(f).

Perot '96 contended-as it did in previous litigation-that the FEC lacked the authority to promulgate such regulations, and that the regulations constitute an illegal exception to the statutory ban on corporate contributions and expenditures under 2 U.S.C. §441b. While the law generally prohibits corporations from making contributions or expenditures in connection with federal elections, Commission regulations make an exception for bona fide nonprofit corporations to sponsor public debates among candidates, provided they follow rules for conducting such debates. 11 CFR 110.13 and 114.4(f). Perot '96 stated that, if the court finds that these regulations are unconstitutional, it should then declare that all expenditures made or contributions received by the CPD are unlawful under the Federal Election Campaign Act (the Act).

In September 1996, Perot '96 filed an administrative complaint alleging that the CPD had violated Commission regulations in the formulation of its debate participant selection criteria. Specifically, Perot '96 charged that the CPD had used subjective criteria to select debate participants, contrary to the Commission's regulations that state that objective criteria must be used in the selection process. It stated that such criteria as polling results and the opinions of journalists were too subjective. Perot '96 also charged that the Democratic and Republican national committees had colluded with the CPD, ensuring that their nominees would be debate participants and violating the debate regulations' proscription against CPD's selecting debate participants solely by their party affiliations.

In February 1998, the Commission voted to reject the FEC General Counsel's recommendation that the CPD had violated Commission regulations on debates and that, as a result, the CPD had made prohibited corporate contributions to the Clinton/Gore and Dole/Kemp committees, that those committees had accepted prohibited contributions, and that the CPD was a political committee that had failed to register or report.

Prior to the Commission's vote, in October 1997, Perot '96 had filed another lawsuit, charging the FEC with delaying its investigation of the administrative complaint (Perot '96 v. FEC, 97-2554). After the FEC dismissed the administrative complaint in February, both Perot '96 and the Commission agreed to the dismissal of that case.


Source:
  FEC Record -- June 1998 [PDF]; and June 1999 [PDF].

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PUBLIC CITIZEN v. FEC

On April 24, 2009, Public Citizen, Inc., and two of its employees, Craig Holman and Taylor Lincoln (the plaintiffs), filed suit against the FEC in the United States District Court for the District of Columbia. The plaintiffs’ suit alleges that the FEC acted "contrary to law" when it dismissed their administrative complaint. That complaint alleged that another organization, Americans for Job Security (AJS), had unlawfully failed to register with the FEC as a political committee and had violated other legal requirements of
the Federal Election Campaign Act (the Act).

Background

According to the lawsuit, Public Citizen, Inc. is a nonprofit membership
organization headquartered in Washington, DC, that advocates the interests of consumers and members of the public before Congress, administrative agencies and the courts on a number of issues. The complaint alleges that AJS is a tax exempt organization under section 501(c)(6) of the Internal Revenue Code, which applies to "business leagues," that is not registered as a political committee with the FEC. Under the Act and Supreme Court precedent, organizations whose "major purpose" is the nomination or election of federal candidates and that receive contributions or make expenditures in excess of $1,000 in a calendar year must register as political committees with the FEC. Political committees are subject to a $5,000 per calendar year contribution limit from individuals and may not receive contributions from corporations or labor organizations.

On April 11, 2007, the plaintiffs submitted an administrative complaint to the Commission asking the Commission to take action against AJS for failing to register as a political committee, failing to report contributions and expenditures, accepting contributions in excess of $5,000 from individuals and accepting contributions from corporations. The administrative complaint also claimed that the major purpose of AJS was supporting or opposing candidates for federal office, which thus subjected it to the registration and reporting requirements of the Act.

The Commission was equally divided on whether to find reason to believe that AJS had violated the Act and on February 25, 2009, voted to dismiss the complaint and to take no further action on the matter.

Complaint

The plaintiffs allege that the Commission acted "contrary to law" in its dismissal of the administrative complaint against AJS. Under 2 U.S.C. §437g(a)(8), dismissal of such a complaint is contrary to law if it rests on an impermissible interpretation of the Act or its implementing regulations or if it is otherwise arbitrary and capricious or an abuse of discretion. The plaintiffs seek an order declaring that dismissal of their administrative complaint against AJS is contrary to law, an order directing the FEC to conform to the court’s declaration within 30 days and all other proper relief.

Source: FEC Record -- June 2009 [PDF].

 

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