Campaign Legal Center (CLC) has filed suit against Iowa Values, a nonprofit dedicated to supporting the reelection of Sen. Joni Ernst, directly for failing to register as a political action committee (PAC).
By failing to register as a PAC, Iowa Values did not report who their contributors are or where that money was spent on and deprived voters of the right to know who funded its spending to influence a Senate election.
The lawsuit asks the court to declare Iowa Values a political committee and order it to provide CLC and the Federal Election Commission (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.
In the summer of 2019, Iowa Values launched a comprehensive campaign to support the reelection of Sen. Ernst. Its press release announced a “six-month voter education and data collection blitz” and “six-figure” digital advertising campaign targeting voters in Iowa.
It described this as a “large-scale effort” that “is just the beginning of an election-long effort by Iowa Values to highlight the work of Sen. Joni Ernst.”
Iowa Values’ fundraising and strategy documents also describe the organization’s “mission” and “focus” of supporting Sen. Ernst’s reelection effort, and public records show that it spent at least $33,000 in 2019 on digital ads supporting her reelection.
Federal campaign finance laws require an organization like Iowa Values, whose “major purpose” is campaign activity, to register with the FEC as a political committee and file regular reports disclosing its contributions, expenditures, and debts.
In failing to do so, Iowa Values violated federal law and harmed CLC, and the electorate at large, by concealing critical information about its sources of funding and the recipients of its spending in support of the Senator. Iowa voters have a right to know who is spending money to secretly influence their vote.
This suit is one of the first of its kind, in that CLC has sued Iowa Values directly over its violations of federal campaign finance law. Typically, the FEC handles enforcement of the Federal Election Campaign Act (FECA), and direct suits by nonagency plaintiffs like CLC are authorized only when the FEC fails to enforce the law.
Indeed, CLC alerted the FEC of these violations more than a year ago in an administrative complaint it filed in December 2019. After waiting more than 190 days for the FEC to act on the matter, CLC sued the FEC in federal court over its delay.
On Oct. 14, 2020, the court issued an order finding that the FEC’s failure to act on CLC’s administrative complaint was “contrary to law” and ordering the Commission to conform by taking action on CLC’s administrative complaint within 90 days.
The FEC still failed to act, and on Feb. 11, 2021, the court issued an order declaring that the FEC had failed to enforce the law and that CLC had a right to sue Iowa Values directly over the violations.
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 a PAC with the FEC and disclose their donors, along with other information about their financial activities.
By failing to comply with federal PAC registration and reporting requirements, Iowa Values has deprived, and continues to deprive, CLC and the public of critical information about who is seeking to influence elections. Its unlawful concealment of this information undermines voters’ trust in our democratic process.