- Rep. Van Hollen and Watchdog Groups File Lawsuit Challenging Flawed IRS Regulations
- Watchdogs File in Defense of Contractor Contribution Ban
- Contribution Limits Defended in Legal Center Brief in Illinois Liberty PAC v. Madigan
- Texas Minority Voters File Amended Challenge to State’s Voter ID Law as Justice Department Enters Fray
- Watchdogs File FEC Complaint against Santorum Campaign for Illegally Directing Super PAC Contributions
- New Litigation Summary from CLC Describes Continuing Flood of Challenges to Campaign Finance Laws & Growing List of Voting Rights Cases
- Public Interest Groups Urge FCC to Continue Improving Political Ad Transparency
- CLC Litigation Director to Co-Lead Course Giving Georgetown Law Students Hands-On Work on Pending Election Law Cases
Rep. Van Hollen and Watchdog Groups File Lawsuit Challenging Flawed IRS Regulations
On August 21st, Representative Chris Van Hollen (D-MD), joined by the Campaign Legal Center, Democracy 21 and Public Citizen, filed a lawsuit in federal district court in Washington, D.C challenging the IRS regulations that govern eligibility for tax-exempt status as a section 501(c)(4) “social welfare” organization. The existing IRS regulations were adopted more than a half century ago in 1959 and the lawsuit charges that the regulations are contrary to the explicit statutory language of the Internal Revenue Code and to court decisions interpreting the Code.
The lawsuit comes more than two years after Democracy 21 and the Campaign Legal Center filed a petition at the IRS challenging the regulations at issue in the case and calling on the IRS to conduct a rulemaking proceeding to adopt new regulations that properly interpret the statute. The IRS failed to act on the rulemaking petition.
Since the Citizens United decision in January 2010, there has been an explosion in the number of groups claiming tax-exempt status as “social welfare” organizations under section 501(c)(4). This has included a number of organizations who have abused the tax laws to claim section 501(c)(4) tax-exempt status in order to keep secret from the American people the donors financing their campaign expenditures.
“This flawed IRS regulation on the books for more than a half-century, together with recent Supreme Court decisions in Wisconsin Right to Life (2007) and Citizens United (2010) permitting 501(c)(4) corporations to pay for election ads, have produced a perfect storm that has flooded recent elections with funds from undisclosed sources,” said Paul S. Ryan, Legal Center Senior Counsel. “In the 2012 cycle, federal election-related spending by section 501(c)(4) organizations exceeded $256 million, triple the amount spent by such groups in the 2008 presidential election cycle ($82.7 million) and an astounding thirty-three times the amount spent by such groups in the 2004 presidential cycle ($7.6 million).”
To read the complaint, click here.
Watchdogs File in Defense of Contractor Contribution Ban
Campaign Legal Center on August 9th, joined by Democracy 21 and Public Citizen, filed an amici brief in Wagner v. FEC in the D.C. Circuit Court of Appeals to oppose an effort to overturn the 70-year-old ban on political contributions from federal contractors to federal candidates, parties and other political committees.
“Multiple courts nationwide have recognized the inherent susceptibility of the government contracting process to corruption and have repeatedly upheld federal, state and local restrictions on contractor campaign contributions,” said Tara Malloy, Legal Center Senior Counsel. “Plaintiffs ask the Court of Appeals to ignore both this legal precedent and the realities of the pay-to-play system and overturn the longstanding contractor contribution ban. The federal ban is a bulwark against corruption and a check on the seemingly endless string of scandals that has seen government officials going to jail for almost as long as government contracts have been handed out.”
In November 2012, the district court granted summary judgment in favor of the FEC, finding that the federal ban was enacted to “prevent corruption and the appearance thereof and, in so doing, to protect the integrity of the electoral system by ensuring that federal contracts were awarded based on merit.” But on May 31, 2013, a three-judge panel of the D.C. Circuit Court of Appeals vacated the district court decision on procedural grounds, holding that the plaintiffs should have instead proceeded directly to the en banc Court of Appeals. The case was remanded to the district court, which then certified constitutional questions back to the en banc Court of Appeals. Recently, the en banc court of appeals postponed oral argument and stayed further proceedings pending the outcome of McCutcheon v. FEC, a constitutional challenge to the aggregate contribution limits of FECA, which will be argued in the U.S. Supreme Court in October.
The Legal Center, along with Democracy 21 and Public Citizens, previously filed amici briefs in this case in the district court and in the Court of Appeals in defense of the contractor contribution ban.
To read the amici brief filed by the Campaign Legal Center and other groups, click here.
Contribution Limits Defended in Legal Center Brief in Illinois Liberty PAC v. Madigan
On August 30th, the Campaign Legal Center, Chicago Appleseed and the Illinois Campaign for Political Reform (ICPR) filed an amici brief supporting the state of Illinois’ motion to dismiss a lawsuit challenging various state law contribution limits. The brief was filed in the U.S. District Court for the Northern District of Illinois in Illinois Liberty PAC v. Madigan, with the assistance of local counsel and ICPR executive director David R. Melton and local counsel Thomas Rosenwein.
“The Supreme Court has repeatedly upheld contribution limits in the interest of preventing corruption and the appearance of corruption. The state of Illinois has seen more than its fair share of corruption, yet Illinois Liberty PAC is asking the district court to ignore precedent and strike down contribution limits far higher than those previously upheld by the Supreme Court,” said Paul S. Ryan, Legal Center Senior Counsel.
The lawsuit challenges the state’s $50,000 limit on PAC contributions to candidates, $5,000 limit on contributions from individuals to candidates, $10,000 limit on contributions from individuals to a PAC and $10,000 limit on contributions from corporations, labor unions and other associations to a candidate for state office. Plaintiffs claim these limits violate their First and Fourteenth Amendment rights to free and freedom of association. Federal PACs may accept only $5,000 from individuals, a mere tenth of the Illinois cap, and the Supreme Court has upheld contribution caps as low as $275.
In September 2012, the Legal Center and other amici filed a brief with the court opposing Illinois Liberty PAC’s ultimately unsuccessful attempt to get a preliminary injunction.
To read the brief filed on August 30th, click here.
Texas Minority Voters File Amended Challenge to State’s Voter ID Law as Justice Department Enters Fray
On August 22nd, Texas voters who would be adversely impacted by the State’s photo ID law, civil rights organizations, elected representatives and a Texas county filed an amended challenge challenging Texas’ controversial law. The amended complaint challenging the constitutionality of the law was filed on the same day that the U.S. Department of Justice (DOJ) filed its own challenge to the law known as Senate Bill 14 (“SB14”). Both the amended complaint and the DOJ lawsuit include a request that the court order bail-in relief under Section 3 of the Voting Rights Act.
Prior to the U.S. Supreme Court’s decision in Shelby County v. Holder, a three-judge federal court in the Washington D.C. blocked the Texas photo ID bill from taking effect, ruling that the law would have a discriminatory impact on minority voters. The Supreme Court’s ruling in late June, however, struck down a key provision of the Voting Rights Act. Consequently, the DC federal court’s decision blocking the SB 14 from going into effect was vacated by the Supreme Court. Within hours of the decision, Texas Attorney General Greg Abbott announced that Texas would immediately implement SB 14, even though the federal court had concluded the law was discriminate against minority voters.
“This law was found by a federal court to be discriminatory against racial and language minorities. Yet once the decision was vacated, the State of Texas made no effort to mitigate the harmful aspects of the photo ID bill that the DC court identified in this blatantly discriminatory law,” said J. Gerald Hebert, Executive Director of the Campaign Legal Center, which is a part of the plaintiffs’ legal team. “Minority voters will be impacted and disenfranchised at vastly disproportional rates by this law. We cannot stand idly by and let the voting rights of racial and language minority voters be trampled under this draconian law.”
The Campaign Legal Center is part of the legal team that includes Chad Dunn and K. Scott Brazil (Brazil & Dunn), Neil G. Baron, David Richards (Richards, Rodriguez & Skeith), Armand Derfner (Derfner, Altman & Wilborn), Luis Roberto Vera, Jr. (LULAC) and Craig M. Watkins and Teresa G. Snelson (Dallas County District Attorney’s Office).
To read the amended complaint, click here.
Watchdogs File FEC Complaint Against Santorum Campaign for Illegally Directing Super PAC Contributions
The Campaign Legal Center, joined by Democracy 21, filed a complaint on August 14th with the Federal Election Commission (FEC), against Rick Santorum and campaign staffers for directing a donor to make a $1 million campaign contribution to a super PAC supporting Santorum’s 2012 presidential run. Federal candidates and their staff are prohibited by the McCain-Feingold law’s “soft money” ban from directing more than $5,000 to a super PAC.
According to a published report, energy executive Bill Doré told Santorum at a January 2012 dinner meeting that he wanted to contribute $1 million to Santorum’s campaign. Given that contributions to federal candidate campaigns are limited to $2,500, Doré reportedly stated in an interview that either Santorum or unnamed staffers told Doré to send his $1 million check to the Red, White and Blue Fund super PAC.
“Mr. Doré’s account of his interaction with Mr. Santorum and his staff, if true, reveals a clear violation of federal campaign finance law,” said Paul S. Ryan, Campaign Legal Center Senior Counsel. “Federal law prohibits candidates and their staff from directing more than $5,000 to a super PAC and either Mr. Santorum or his staff seemingly directed a $1 million contribution to the Red, White and Blue Fund.”
An FEC advisory opinion issued in the wake of the Supreme Court’s Citizens United decision states that while super PACs may accept unlimited contributions, the McCain-Feingold law’s soft money restrictions and the federal law $5,000 contribution limit remain applicable to federal candidate fundraising for super PACs.
To read the story, click here.
To read the complaint filed by the Campaign Legal Center and Democracy 21, click here.
New Litigation Summary from CLC Describes Continuing Flood of Challenges to Campaign Finance Laws & Growing List of Voting Rights Cases
Ideological and interest group opponents of campaign finance regulation continue to flood the courts with cases challenging campaign finance laws at the federal, state and municipal levels. The Legal Center has released an updated summary of that litigation to facilitate the tracking of the long list of cases. McCutcheon v. FEC, a challenge to the federal aggregate contribution limits, will be argued before the U.S. Supreme Court this Term, with still more cases on the way up through the lower courts. At the same time, attempts to enact racially-discriminatory voting laws at the state level has generated a spike in voting rights cases, a situation exacerbated by the Supreme Court’s recent decision to strike down a key provision of the Voting Rights Act in Shelby County v. Holder.
The Legal Center’s litigation summary attests to the enormous number of active legal cases concerning campaign finance and voting rights and underscores the need to remain vigilant in tracking and participating in litigation in 2013 and coming years. The most recent update of the litigation summary is always available on the Legal Center website’s Court Case of Interest page between the active cases and past cases.
To read the Legal Center’s updated litigation summary, click here.
Public Interest Groups Urge FCC to Continue Improving Political Ad Transparency
On August 26th, the Legal Center as part of the Public Interest Public Airwaves Coalition (PIPAC), along with the Sunlight Foundation, filed comments with the Federal Communications Commission (FCC) about the agency’s rules requiring broadcasters to post their political files online.
In April 2012, the FCC adopted rules requiring broadcasters in the top 50 markets that are affiliated with the "top four" national networks to post their political files online. All other stations will be required to post their files online by July 2014. Political files contain information on political advertisements, including the groups purchasing ads, the prices paid and times aired. They include political advertising information on all electoral races and ballot initiatives — information that is not available anywhere else. Posting these files online has created greater transparency about the impact of political ads on the electoral process.The comments underscore the public benefits of the FCC’s online-posting requirement. Having access to online files, the comments noted, has contributed to more comprehensive reporting on the sources of political advertising and has provided the public with critical information regarding the funders behind these advertisements. The groups call for improvements to the current reporting system and urge the FCC to adopt data and reporting standards that will improve the accessibility and usability of the data. These improvements would help reduce reporting errors while also facilitating the creation of a more user-friendly database.
In addition to the Campaign Legal Center, PIPAC Coalition Members include the Benton Foundation, Common Cause, Free Press, the New America Foundation and the United Church of Christ Office of Communication Inc., along with the Sunlight Foundation.
To read the comments, click here.
CLC Litigation Director to Co-Lead Course Giving Georgetown Law Students Hands-On Work on Pending Election Law Cases
This semester, Georgetown University law students will have the opportunity for hands-on legal work on pending election law and voting rights cases through a practicum course for credit. The election law class will be co-taught by Paul M. Smith, the Chair of Jenner & Block’s Appellate and Supreme Court Practice, and J. Gerald Hebert, the Campaign Legal Center’s Executive Director and Director of Litigation.
The course will review campaign finance regulation and voting rights law and provide students with opportunities to draft legal memoranda and briefs in pending cases, as well as proposed legislative fixes, at a time when voting rights and campaign finance reforms across the country are facing new challenges.
“This course allows students to get real world experience in pending campaign finance and voting rights cases,” said J. Gerald Hebert of the Legal Center. “This is a busy and challenging time in the wake of major Supreme Court decisions that have severely undermined voting rights and campaign finance reforms.”
The semester-long course consists of a weekly two-hour seminar and ten-hours of supervised work per week.