On Feb. 12, 2021, Campaign Legal Center (CLC) filed suit against Iowa Values, a nonprofit 501(c)(4) corporation, for violating federal campaign finance law. Despite its major purpose of supporting the reelection of U.S. Sen. Joni Ernst, Iowa Values failed to register as a political action committee (PAC) and publicly disclose its donors and the recipients of its spending. CLC filed this citizen suit against Iowa Values after the Federal Election Commission (FEC) failed to enforce the law and a federal district court ordered that the FEC’s inaction entitled CLC to sue Iowa Values directly under the Federal Election Campaign Act’s (FECA) citizen suit provision.
CLC’s lawsuit asks the court to declare that Iowa Values violated the law and order it to provide CLC and the FEC with the information it illegally concealed regarding the sources of its funding and the recipients of its spending in support of Sen. Ernst.
The lawsuit also asks the court to require Iowa Values to continue filing reports disclosing its receipts and disbursements, including the more than $156,000 Iowa Values spent on digital ads supporting the senator and/or opposing her opponent in the months before the 2020 election.
Finally, the lawsuit asks the court to assess an appropriate civil penalty against Iowa Values to be paid to the federal government.
What’s At Stake
Transparency around who is spending money to support or oppose federal candidates is a cornerstone of FECA and critical to our democracy. Under FECA, organizations that exist primarily to engage in political activity—including making expenditures to support their preferred candidates—must register as political committees with the FEC and disclose their donors, along with other information about their financial activities.
CLC’s complaint cites evidence suggesting that Iowa Values’ major purpose — as reflected in its public communications, fundraising appeals and strategy documents — was to support the election of Sen. Joni Ernst. But Iowa Values failed to register as a federal PAC and has not filed the necessary reports disclosing its contributions and expenditures, as required by FECA. Iowa Values’ unlawful concealment of this information has deprived, and continues to deprive, CLC and the public of critical information about who is behind its spending to influence a federal election.
In the absence of FEC action to ensure that organizations like Iowa Values do not get away with evading federal law, CLC brought this lawsuit to enforce FECA’s transparency requirements for groups whose major purpose is to influence federal elections.