CLC Update February 16, 2010

  1. CLC Recommends Citizen United Fixes to Congressional Committees
  2. Legal Center Hails Congressional Legislative Response to Citizens United
  3. CLC Urges President Obama to Nominate New FEC Commissioners
  4. Legal Center Files Comments in Nonfederal Fundraising Rulemaking
  5. Appellate Court Hears Oral Arguments in
  6. Law School Audience Addressed by Executive Director
  7. Executive Director Speaks to American University Students


CLC Recommends Citizens United Fixes to Congressional Committees

At the request of committee staff, the Campaign Legal Center submitted letters recommending legislative responses to the Supreme Court's ruling in Citizens United v. Federal Election Commission. In the wake of the Court's decision, both houses of Congress scheduled hearings to examine possible legislative solutions to help mitigate the dangers of corporate treasury funds significantly influencing the upcoming midterm elections. The Legal Center submitted recommendations to both Sen. Charles Schumer (D-NY), Chairman of the Senate Rules and Administration Committee, and Rep. Robert Brady (D-PA), Chairman of the House Committee on House Administration.

Many of the Legal Center's recommendations later appeared in the legislative package announced by Sen. Schumer and Rep. Chris Van Hollen (D-MD). The framework will include: a ban on expenditures from foreign interests, federal contractors, and TARP recipients, disclosure to the public through enhanced reporting through the FEC and LDA, disclosure to shareholders directly and through the SEC, CEO "Stand By Your Ad" provisions, stronger coordination rules and updated Lowest Unit Rate provisions to ensure air time for candidates and party committees.


Legal Center Hails Congressional Legislative Response to Citizens United

On February 11, 2010, Policy Director Meredith McGehee hailed a legislative framework unveiled by Senator Charles Schumer (D-NY) Representative Chris Van Hollen (D- MD) in response to the Citizens United ruling. Their proposal tracked closely with recommendations, referenced above, that were submitted earlier to House and Senate committees of jurisdiction at the request of staff.

McGehee called the proposal a "strong counter-thrust to the damage done to our democracy" through the activist decision by the Court, and stressed that the proposal deserve broad bipartisan support. She encouraged Congress to "move quickly to enact these measures before undisclosed corporate money, likely laundered through trade associations and front groups, floods the 2010 election cycle."

The legislation is expected to be formally introduced after the Presidents Day recess.


CLC Urges President Obama to Nominate New FEC Commissioners

The Campaign Legal is urging President Obama to replace three Federal Election Commissioners (FEC) serving expired terms in response to the Supreme Court's ruling in Citizens United v. FEC. In a February 4, 2009 letter, Campaign Legal Center Executive Director J. Gerald Hebert strongly urged the President to nominate individuals willing to enforce our nation's campaign finance laws. The need to repair the dysfunctional enforcement agency has become still more critical in light of the Court's recent ruling.

In his State of the Union address, President Obama emphasized the need to respond to the activist decision from the Supreme Court. While legislative responses have been promised by Congress, Hebert emphasized that reforming the FEC can and should move forward on a complimentary and parallel track.

Reforms to the FEC will face significant opposition in Congress, but Hebert stressed to the President that, "it is a fight that your Administration must undertake to be true to the commitments you made during your presidential campaign, at your Inauguration, after the Court's decision, and at your State of the Union address."


Legal Center Files Comments in Nonfederal Fundraising Rulemaking

On February 8, 2010, the Campaign Legal Center, together with Democracy 21, filed comments in the FEC rulemaking regarding "Participation by Federal Candidates and Officeholders at Nonfederal Fundraising Events" (NPRM 2009-26). The filing is the latest by the CLC in a nearly eight-year battle with the FEC over the agency's ineffective implementation of the Bipartisan Campaign Finance Reform Act of 2002 (BCRA).

BCRA provides that federal candidates and officeholders may not "solicit, receive, direct, transfer or spend" soft money ( i.e. , funds that do not comply with the amount limitations and source prohibitions of the Federal Election Campaign Act). Notwithstanding this restriction, BCRA also states that federal candidates and officeholders are permitted to "attend, speak, or be a featured guest at a fundraising event for a State, district, or local committee of a political party." Despite clear congressional intent to prohibit—and clear statutory language prohibiting—federal candidate and officeholder soft money fundraising, the FEC in its 2002 rulemaking to implement these provisions concluded that the latter provision "was a total exemption from the general solicitation ban" and adopted a regulation permitting federal candidates and officeholders to attend, speak, and appear as featured guests at State, district, and local party committee fundraising events "without restriction or regulation."

This FEC regulation was challenged in the “Shays III " lawsuit, with the CLC representing Senators McCain and Feingold as amici curiae —and the U.S. Court of Appeals for the D.C. Circuit invalidated the regulation, concluding that the FEC-created regulatory exemption from the general soft money solicitation ban " allows what BCRA directly prohibits."

The FEC in this most current rulemaking proposes three alternative amendments to its regulations to comply with the Shays III decision. The first alternative would simply delete the regulatory language permitting federal candidates and officeholders from participating in soft money fundraisers "without restriction or regulation." We support this approach as the simplest, most straightforward means of complying with the Shays III decision. We further commented that, though perhaps unnecessarily complicated, the second and third alternatives in NPRM 2009-26 are also both permissible means of complying with the Shays III decision.


Appellate Court Hears Oral Argument In Speechnow.Org

On January 27, 2010, the en banc Court of Appeals for the D.C. Circuit heard oral argument in v. FEC. It was one of the first oral arguments heard in a campaign finance case in the wake of the recent Supreme Court ruling in Citizens United v. FEC. has challenged the federal contribution limits and disclosure requirements as applied to political committees, such as, that make only independent expenditures.

The FEC defended the contribution limits as a valid measure to avoid circumvention of the federal campaign finance laws, and to prevent political corruption or the appearance of corruption. The FEC also argued that the Supreme Court had consistently approved of political disclosure requirements, and had recently upheld requirements similar to those challenged by in an 8-1 opinion in the Citizen United case.

The D.C. Circuit is expected to issue its opinion in the following months.

The Legal Center, along with Democracy 21, filed two amici briefs with the Court of Appeals in the case on September 30, 2009 and December 15, 2009.


Law School Audience Addressed By Executive Director

On January 25, 2010, Gerry Hebert, Executive Director and Director of Litigation, spoke at American University's Washington College of Law on a panel entitled "Voting Rights and Democracy After NAMUDNO." Hebert summarized the process in which state and local entities could "bailout" from coverage under the special provisions of the Voting Rights Act of 1965, and discussed the impact of the Supreme Court case, Northwest Austin Municipal Utility District No. 1 v. Holder , on the bailout provisions. Hebert also discussed several reasons why districts historically have chosen not to seek the bailout exemption and suggested that those entities who believe they meet the "bailout" criteria should consider doing so .


Executive Director Speaks To American University Students

On February 17, 2010, the Legal Center's Executive Director, Gerry Hebert, was invited to deliver a guest lecture at American University on the topic of campaign finance. Hebert gave a historical overview of campaign finance reform legislation and subsequent legal challenges, from the Tillman Act of 1907 to the recent Supreme Court ruling in Citizens United v. FEC. Hebert discussed the possible dangers to American democracy that corporations could inflict if they were allowed to spend unlimited amounts of money in elections. He concluded with an outline of possible legislative remedies Congress could enact that would help mitigate the damages inflicted by the Citizens United decision.