Federal Court Rejects FEC’s Attempt to Dismiss Lawsuit Calling for FEC Investigation into Anonymous Contributions

WASHINGTON – A federal district court today refused to throw out a lawsuit Campaign Legal Center and Democracy 21 filed against the Federal Election Commission (FEC). CLC and D21 filed the suit in the United States District Court for the District of Columbia after the FEC failed to act on five complaints calling on the agency to investigate donors who broke disclosure laws by hiding behind opaque corporate entities like Limited Liability Companies (LLCs) to anonymously make contributions to super PACs.

In response to the lawsuit, the FEC called on the court to dismiss the case, on the ground that CLC and D21 failed to show standing, or the right to sue. The court disagreed as to the majority of the FEC complaints and now the case will be heard on the merits. 

“The Federal Election Commission is out of control and this court has made clear that the agency will not be able to easily avoid being held accountable for failing to do its job in enforcing campaign finance laws,” said Larry Noble, senior director of regulatory reform programs and general counsel for CLC. “The U.S. Supreme Court has made it clear that disclosure laws play a vital role in providing the electorate with critical information to make informed choices. Each time the FEC fails to pursue a serious violation of the law, it weakens our democracy and the ability of Americans to know who is truly influencing our elections. It also sends a loud and clear message that those who violate campaign finance laws will face no penalties. We can’t sit idly by and let the FEC destroy the integrity of our democracy.”

“We have reached the point where the only way it seems possible to get the dysfunctional FEC to do its job is by suing them,” said Democracy 21 President Fred Wertheimer. “The FEC’s failure to adopt regulations that properly interpret the campaign finance laws is a major reason why so much dark money is pouring into federal elections. We are very pleased that the district court judge has refused to go along at this stage of our lawsuit with the FEC’s stonewalling opposition to our efforts to obtain campaign finance disclosures that the America people have a right to know.”

CLC and D21, over the course of several years, filed complaints with the FEC against several newly formed corporate entities and their undisclosed donors for violating the “straw donor” provision of Federal Election Campaign Act (FECA). These donors’ anonymous contributions ranged from $857,000 to over $12 million, and some of the donors openly admitted in the media that they had used or even created personal companies to hide their identities from the public. Still, the FEC dismissed all five complaints, after the three Republican commissioners voted not to investigate and sanction these donors.   

The lawsuit states that in dismissing these complaints, the FEC has “undermined FECA’s purposes, including its goal of promoting transparency in elections and providing the electorate with information about who is speaking to it during elections.” CLC and D21, along with the public, “were deprived of timely information about the sources of the contributions made to the super PACs – information to which they are legally entitled to under FECA.”

The lawsuit calls for the court to find that the FEC’s dismissal of the complaints was “arbitrary, capricious, and an abuse of discretion, and otherwise contrary to the law,” and seeks a judicial order demanding the FEC enforce the law within 30 days.

Current recusal rules lag behind most states, leading to conflicts of interest; recent history highlights importance of amending state recusal rules

WASHINGTON – Today, the Campaign Legal Center sent a letter to the Wisconsin Supreme Court supporting a petition by 54 retired state judges urging the adoption of rules requiring that judges step aside from cases involving their top campaign supporters.

“The U.S. Supreme Court has repeatedly emphasized that the constitution requires that judges recuse themselves from cases where there is a significant risk of bias or its appearance, even in the absence of actual bias,” said Brendan Fischer, federal and FEC reform program director at the Campaign Legal Center. “Wisconsin rules fall short of express U.S. Supreme Court guidance on recusal and puts Wisconsin behind the majority of other states in protecting the integrity of the judiciary.“

In 2009, the U.S. Supreme Court held in Caperton v. Masey (2009) that the constitution required that a state judge step aside from a case involving a company whose CEO had spent $3 million helping elect the justice through issue advocacy communications and independent expenditures. In several cases in the years since Caperton, the Court has repeatedly reaffirmed this holding and the broader importance of preserving the reality and appearance of judicial integrity.

Additionally, the importance of clear, objective recusal rules has become more pointed in light of recent changes to Wisconsin law that allow judicial candidates to control or otherwise coordinate with third-party groups engaged in “issue advocacy communications”—electoral ads that omit terms like “vote for” or “vote against” – which are the dominant form of electoral advocacy in Wisconsin Supreme Court elections. An individual is limited in how much they may give directly to a judicial candidate, and must have their contribution disclosed, but a person may secretly donate unlimited amounts to an issue advocacy group working directly with that candidate.

“While the U.S. Supreme Court in Caperton addressed significant independent spending that benefitted the justice in that case, Wisconsin’s new law permits a judicial candidate to control similar expenditures,” said Fischer. “At a minimum, the Court must revisit its recusal rules because the current standards were drafted with the understanding that issue advocacy communications would be independent of a judicial candidate, and this is no longer the case.”

Read our letter

DURHAM, N.C. – In a unanimous ruling, a three judge panel in North Carolina in the U.S. District Court for the Middle District of North Carolina denied a request by defendants to dismiss League of Women Voters of North Carolina v. Rucho.  The case was initially filed in September 2016 claiming that partisan gerrymandering in North Carolina’s 2016 congressional redistricting plan violates the First and Fourteenth Amendments of the U.S. Constitution.

“We are inching closer to North Carolinians having their day in court,” said Ruth Greenwood, deputy director of redistricting at the Campaign Legal Center. “Voters should be able to choose their representatives, yet in North Carolina and other states across the nation, politicians are manipulating maps to choose their voters and stay in power. North Carolina’s map is an egregious partisan gerrymander that prevents voters from having their voices heard on policy decisions that directly impact their lives. Through this litigation, we hope to advance a legal theory we believe can stop this unconstitutional practice nationwide, and return democracy to the people.”

The trial in the case is set to begin on June 26, 2017, in Greensboro, N.C.

“On behalf of our clients and the voters of North Carolina, we are happy that this case will now proceed to an examination of the evidence and the merits of our claims,” said Anita Earls, executive director of the Southern Coalition for Social Justice. “Our clients want to see government returned to rule by the will of the people instead of a system plagued by partisan manipulation.”

The lawsuit as filed in September 2016 can be found here.