Citizens for Responsibility and Ethics in Washington v. Federal Election Commission ( 2011 )

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
CITIZENS FOR RESPONSIBILITY AND
ETHICS IN WASHINGTON, et al.,
Plaintiffs,
v. Civil Action No. 10-1350 (JEB)
FEDERAL ELECTION COMMISSION,
Defendant.
MEMORANDUM OPINION
Citizens for Responsibility and Ethics in Washington (CREW) and its Executive
Director, Melanie Sloan, bring this suit alleging that the Federal Election Commission
wrongfully dismissed their administrative complaint. In addition, they claim that the
Commission did not provide timely notice of the dismissal or the reasons therefor. Because
Plaintiffs have not sufficiently articulated a concrete and particularized injury, they lack standing
to pursue these claims.1
I. Factual Background
A. FECA
The Federal Election Campaign Act (FECA), 2 U.S.C. §§ 431 et seq., as amended by the
Bipartisan Campaign Reform Act of 2002, Pub. L. No. 107-155, seeks to remedy any actual or
perceived corruption of the political process through contribution and expenditure limitations as
well as recordkeeping and disclosure requirements. See Federal Election Commission v. Akins,
1
The Court has reviewed Plaintiffs’ Amended Complaint, Defendant’s Motion to Dismiss, Plaintiffs’
Opposition, and Defendant’s Reply.
1
524 U.S. 11, 14 (1998). The Federal Election Commission (FEC) is the independent, executive-
branch agency that oversees the implementation and administration of FECA. 2 U.S.C. § 437c.
The Commission is composed of six voting members, no more than three of whom may be
affiliated with the same political party, who are appointed by the President and confirmed by the
Senate. § 437c(a)(1).
The FEC is the exclusive civil enforcement authority for violations of FECA. §§
437c(b)(1); 437d(e). Any person who believes that a violation of the Act has occurred may file a
signed and sworn complaint with the FEC. § 437g(a)(1). Upon receipt of a complaint, the FEC
must, within five days, notify the person or persons alleged in the complaint to have committed
such a violation. Id. The subjects of the complaint then have fifteen days to demonstrate to the
FEC that no action should be taken against them on the basis of the complaint. Id. If the
Commission determines, by a vote of at least four of its members, that it has “reason to believe
that a person has committed, or is about to commit, a violation,” the Commission must conduct
an investigation. § 437g(a)(2). After the investigation, the General Counsel of the Commission
then makes a recommendation regarding how to proceed by filing with the Commission a “brief
stating the position of the general counsel on the legal and factual issues of the case.” §
437g(a)(3). After considering this recommendation, the Commission then determines how to
proceed – e.g., it may dismiss the complaint, attempt to correct or prevent the violation, enter
into a conciliation agreement with any person involved, or institute enforcement proceedings up
to and including a civil suit in federal district court against the violators. See §§ 437g(a)(4)-(6).
If at any time the Commission votes to dismiss a complaint filed under § 437g(a)(1), the
filer may seek judicial review. § 437g(a)(8). Section 437g(a)(8) provides the timeline and legal
standard for such an action:
2
(A) Any party aggrieved by an order of the Commission dismissing
a complaint filed by such party under paragraph (1), or by a
failure of the Commission to act on such complaint during the
120-day period beginning on the date the complaint is filed,
may file a petition with the United States District Court for the
District of Columbia.
(B) Any petition under subparagraph (A) shall be filed, in the case
of a dismissal of a complaint by the Commission, within 60
days after the date of the dismissal.
(C) In any proceeding under this paragraph the court may declare
that the dismissal of the complaint or the failure to act is
contrary to law, and may direct the Commission to conform
with such declaration within 30 days, failing which the
complainant may bring, in the name of such complainant, a civil
action to remedy the violation involved in the original
complaint.
In determining whether the Commission’s decision to dismiss a complaint (also known as
a “Matter Under Review” or “MUR”) was contrary to law, the Court may review the General
Counsel’s brief in cases where the General Counsel recommended dismissal, see FEC v.
Democratic Senatorial Campaign Committee, 454 U.S. 27, 38 n.19 (1981), or the Commission’s
“Statement of Reasons” in cases where the Commission declined to follow the General
Counsel’s recommendation to proceed with the case. See Common Cause v. FEC, 108 F.3d 413,
415 (D.C. Cir. 1997).
B. CREW
CREW is a § 501(c)(3) non-profit corporation that “uses a combination of research,
litigation, and advocacy to advance its mission” of “ensuring the integrity of government
officials and [] protecting the right of citizens to be informed about the activities of government
officials.” Am. Compl., ¶ 5. In furtherance of this goal, CREW and its Executive Director,
Plaintiff Melanie Sloan, “monitor[] the campaign finance activities of those who run for federal
office and publicize[] those who violate federal campaign finance laws through its website, press
3
releases, reports, and other methods of distribution.” Id. at ¶ 6. CREW also “files complaints
with the FEC when it discovers violations” of FECA. Id.
C. The Current Action
Plaintiffs initiated this case on August 11, 2010, and filed their Amended Complaint on
October 28, 2010. Plaintiffs’ claims arise from the FEC’s decision to dismiss MUR 5908, an
administrative complaint Plaintiffs filed against Peace Through Strength Political Action
Committee (PTS PAC) and its treasurer, Meredith Kelley, on March 14, 2007. Id., ¶ 33; Opp.,
Exh. 1 (Federal Election Commission Complaint In the Matter of: Peace through Strength PAC
and Meredith Kelley, Treasurer).
PTS PAC was the political action committee of Representative Duncan Hunter, who was
a candidate for President of the United States during the 2008 election. Am. Compl., ¶ 33.
Plaintiffs generally complained that PTS PAC provided support to Hunter, in violation of FECA,
both during the “testing the waters” phase before he officially entered the presidential race, as
well as after he registered his principal campaign committee, Hunter for President (also called
the Hunter Committee). See FEC Complaint. More specifically, Plaintiffs’ administrative
complaint alleged four separate counts against PTS PAC. First, Plaintiffs alleged that Hunter
“traveled extensively to early presidential primary states . . . using PTS PAC to ‘test the waters’
for his presidential candidacy,” id., ¶ 25; by receiving 11 individual contributions (totaling
$52,650) that exceeded FECA’s $2,300 individual contribution limit to an individual engaged in
“testing the waters,” PTS PAC knowingly accepted $27,350 in excessive contributions in
violation § 441a(f). Id., ¶ 27. Second, Plaintiffs alleged that because PTS PAC expended over
$5,000 on advertisements designed to publicize Hunter’s intention to campaign for federal office,
it was required to register with the FEC as Hunter’s principal campaign committee, but failed to
do so in violation of § 433(a). Id., ¶¶ 23-31. Third, Plaintiffs alleged that by paying an amount
4
in excess of $5,000 for PTS PAC advertisements featuring Hunter after the formation of Hunter
for President, PTS PAC made excessive in-kind contributions to Hunter for President in violation
of § 441a(a)(2)(A) and 11 C.F.R. § 110.2(b)(1). Id., ¶¶ 32-35. Finally, Plaintiffs alleged that to
the extent PTS PAC had failed to report disbursements for certain television advertisements in
December 2006, it violated 11 C.F.R. §§ 104.3(b) and 104.9(a). Id., ¶¶ 36-37.
After reviewing the administrative complaint and PTS PAC’s response, the FEC’s
General Counsel prepared an initial report recommending that the Commission find reason to
believe that PTS PAC, Meredith Kelley, Duncan Hunter, Hunter for President, and Treasurer
Bruce Young had violated FECA. Opp., Exh. 3 (First General Counsel’s Report). The First
General Counsel’s Report did not address CREW’s claims exactly as they appeared in the
administrative complaint, but instead found somewhat different violations. Although Plaintiffs’
administrative complaint had focused on the advertisements paid for by PTS PAC, this Report
concluded that while “the television ads that are the primary focus of the complaint did not
constitute an in-kind contribution to Hunter’s presidential campaign or cause Hunter to trigger
candidate status, it appears that other PTS PAC disbursements did lead to violations of the Act.”
Id. at 3. Specifically, the General Counsel recommended that the Commission find reason to
believe that: (1) Duncan Hunter failed to timely file a Statement of Candidacy and to maintain
records of contributions received and expenditures made while he was “testing the waters”; (2)
Hunter for President, Inc. and its Treasurer, Bruce Young, failed to report contributions received
and expenditures made by Hunter during the “testing the waters” period after it had registered as
Hunter’s principal campaign committee and was required to file reports of receipts and
disbursements with the Commission; and (3) PTS PAC and its Treasurer, Meredith Kelley, made
excessive in-kind contributions to Duncan Hunter for his Presidential campaign and that Duncan
5
Hunter and Hunter for President, Inc. and Bruce Young accepted excessive contributions. Id.The potentially excessive in-kind contributions identified in this Report related not to the
advertisements funded by PTS PAC, but rather to PTS PAC’s funding of Hunter’s travel to early
primary states during his “testing the waters” phase. Id. at 11. The General Counsel
recommended that the Commission “take no action at this time” regarding the allegations that
PTS PAC and Meredith Kelley failed to report disbursements for the television advertisements
run in December 2006. Id. at 3.
Based on the First General Counsel’s Report, the Commission found reason to believe
that violations of FECA had occurred, see Am. Compl., ¶ 35, and conducted an investigation of
the issues raised by MUR 5908. Following the investigation, the General Counsel prepared her
second report to the Commission. See Opp., Exh. 4 (General Counsel’s Report #2). Portions of
Report #2 are redacted, including some of the General Counsel’s recommendations. See, e.g., id.
at 3, 13-15. The public portions of this Report, however, reveal that PTS PAC expended
$10,243 on Hunter’s “testing-the-waters” travel between November 2006 and January 2007, and
the “investigation confirmed that PTS PAC violated 2 U.S.C. §§ 441a(a)(2) and 434(b), by
making and failing to report excessive in-kind contributions to the Hunter Committee and that
Hunter and the Hunter Committee violated 2 U.S.C. §§ 441a(f) and 434, by accepting and failing
to report PTS PAC’s excessive in-kind contributions.” Id. at 2-3. With respect to allegations
that Hunter was late in filing his Statement of Candidacy, the General Counsel recommended
that “[b]ecause the Statement of Candidacy was only three days late, . . . we are not
recommending the Commission pursue a civil penalty for these violations.” Id. at 10-11. She
again recommended that the Commission find no reason to believe PTS PAC and Meredith
6
Kelley violated §§ 434(b) and 441a(a)(2) with respect to the televisions advertisements. Id. at
15.
Having received both General Counsel’s Reports, the FEC voted to dismiss MUR 5908
on June 29, 2010, thereby triggering Plaintiffs’ 60-day clock in which to appeal the dismissal.
Am. Compl., ¶¶ 47, 36. In its Statement of Reasons for dismissing CREW’s administrative
complaint, the Commission addressed CREW’s allegations regarding excessive contributions
and reporting violations. See Mot., Exh. 1 (Statement of Reasons). The Commission explained:
The Commission’s investigation indicates that PTS PAC made
approximately $10,200 in disbursements for travel expenses
incurred during approximately the same time that Congressman
Hunter was testing the waters for his presidential campaign. . . .
PTS PAC is subject to a maximum contribution limit of $5,000.
Therefore, if any of the disbursements at issue were on behalf of the
Hunter Committee, they would have resulted in up to $10,200 in in-
kind contributions that were not reported, of which up to $5,200
would have been excessive. On the other hand, if the disbursements
were made solely on behalf of PTS PAC, then no in-kind
contributions would have resulted.
Id. at 3. After reviewing the results of the investigation, the Commission observed that
[n]othing revealed in the Commission’s investigation contradicts
the conclusion that the travel disbursements advanced PTS PAC’s
core mission. The Commission notes further that any
disbursements benefitting both the presidential campaign and PTS
PAC would have been allocable between the two committees. Even
if one assumes that PTS PAC and the Hunter Committee benefitted
equally from the disbursements, such an allocation would reduce
the amount of potentially excessive contributions to just over $100.
Id. The Commission therefore decided that “[i]n light of the relatively small amount potentially
in violation,” it would “exercise its prosecutorial discretion pursuant to Heckler v. Chaney, 470
U.S. 821, 831 (1985), and take no further action as to the allegations regarding excessive in-kind
contributions.” Id. The Commission similarly exercised its prosecutorial discretion to dismiss
the complaint as to Hunter’s alleged late filing of his Statement of Candidacy, finding that any
7
potential violation would be “de minimis” as “his [s]tatement was, at most, three days late.” Id.
at 4.
In a letter dated July 23 – 24 days after the vote – and received by CREW on July 27, the
FEC notified Plaintiffs that MUR 5908 had been dismissed. Am. Compl., ¶ 34. On August 11,
43 days after the Commission had dismissed MUR 5908, Plaintiffs filed their original Complaint
in this case. Id., ¶ 38. At that time, the FEC had not yet published its Statement of Reasons for
dismissing MUR 5908. Id. On August 23, the FEC posted on its website the Certification of the
June 29, 2010, Commission vote to dismiss and the two General Counsel Reports relating to
MUR 5908 (dated January 18, 2008, and May 3, 2010). Id., ¶¶ 47-48, 50. By letter dated
August 24, 2010, six days before Plaintiffs’ window of appeal was set to close, the FEC sent
Plaintiffs its Statement of Reasons for dismissing MUR 5908. Id., ¶ 40.
Now that Plaintiffs have been afforded the opportunity to amend their Complaint to take
the FEC’s Statement of Reasons into account, they currently assert two claims. First, Plaintiffs
allege that the FEC wrongfully dismissed MUR 5908 in violation of § 437g(a)(8)(A). Id. at ¶¶
70-72. Second, Plaintiffs allege that the FEC did not timely notify them of the dismissal, and,
moreover, it has an unlawful policy and practice of failing to provide § 437g(a)(8)(A)
complainants with the “statutorily mandated 60 days’ notice of dismissal and basis of dismissal.”
Id. at ¶¶ 73-78. Plaintiffs seek declaratory and injunctive relief for these alleged violations.
The FEC has now moved to dismiss Plaintiffs’ Amended Complaint under Federal Rules
of Civil Procedure 12(b)(1) and 12(b)(6) on the grounds that Plaintiffs lack standing and have
failed to state a claim.
8
II. Legal Standard
In evaluating Defendant’s Motion to Dismiss, the Court must “treat the complaint's
factual allegations as true . . . and must grant plaintiff ‘the benefit of all inferences that can be
derived from the facts alleged.’” Sparrow v. United Air Lines, Inc., 216 F.3d 1111, 1113 (D.C.
Cir. 2000) (quoting Schuler v. United States, 617 F.2d 605, 608 (D.C. Cir. 1979)) (internal
citation omitted); see also Jerome Stevens Pharms., Inc. v. FDA, 402 F.3d 1249, 1253 (D.C. Cir.
2005). This standard governs the Court’s considerations of Defendant’s Motion under both Rules
12(b)(1) and 12(b)(6). See Scheuer v. Rhodes, 416 U.S. 232, 236 (1974) (“in passing on a
motion to dismiss, whether on the ground of lack of jurisdiction over the subject matter or for
failure to state a cause of action, the allegations of the complaint should be construed favorably
to the pleader”); Walker v. Jones, 733 F.2d 923, 925-26 (D.C. Cir. 1984) (same). The Court
need not accept as true, however, “a legal conclusion couched as a factual allegation,” nor an
inference unsupported by the facts set forth in the Complaint. Trudeau v. Fed. Trade Comm’n,
456 F.3d 178, 193 (D.C. Cir. 2006) (quoting Papasan v. Allain, 478 U.S. 265, 286 (1986)
(internal quotation marks omitted).
To survive a motion to dismiss under Rule 12(b)(1), Plaintiffs bear the burden of proving
that the Court has subject matter jurisdiction to hear their claims. See Lujan v. Defenders of
Wildlife, 504 U.S. 555, 561 (1992); U.S. Ecology, Inc. v. U.S. Dep’t of Interior, 231 F.3d 20, 24
(D.C. Cir. 2000). A court has an “affirmative obligation to ensure that it is acting within the
scope of its jurisdictional authority.” Grand Lodge of Fraternal Order of Police v. Ashcroft, 185
F. Supp. 2d 9, 13 (D.D.C. 2001). For this reason, “‘the [p]laintiff’s factual allegations in the
complaint . . . will bear closer scrutiny in resolving a 12(b)(1) motion’ than in resolving a
12(b)(6) motion for failure to state a claim.” Id. at 13-14 (quoting 5A Charles A. Wright &
Arthur R. Miller, Federal Practice and Procedure § 1350 (2d ed. 1987) (alteration in original)).
9
Additionally, unlike with a motion to dismiss under Rule 12(b)(6), the Court “may consider
materials outside the pleadings in deciding whether to grant a motion to dismiss for lack of
jurisdiction.” Jerome Stevens, 402 F.3d at 1253; see also Venetian Casino Resort, L.L.C. v.
E.E.O.C., 409 F.3d 359, 366 (D.C. Cir. 2005) (“given the present posture of this case – a
dismissal under Rule 12(b)(1) on ripeness grounds – the court may consider materials outside the
pleadings”); Herbert v. Nat’l Academy of Sciences, 974 F.2d 192, 197 (D.C. Cir. 1992).
III. Analysis
The FEC moves to dismiss both counts of Plaintiffs’ Amended Complaint on the grounds
that Plaintiffs lack standing and that they have failed to state a claim under § 437g(a)(8). The
Court need only reach the first question.
A. Wrongful Dismissal of MUR 5908
Plaintiffs allege that the FEC’s dismissal of MUR 5908 was “arbitrary, capricious, an
abuse of discretion, and contrary to law in violation of 2 U.S.C. § 437g(a)(8)(A).” Am. Compl.,
¶ 71. Plaintiffs complain that, “[d]espite the FEC’s finding that PTS PAC had made illegal
excessive contributions to the Hunter for President campaign, neither PTS PAC nor Hunter for
President has ever amended its FEC reports to reflect the in-kind contributions by PTS PAC to
Hunter for President. In the absence of these corrections to the public record, it is impossible to
determine from any examination of PTS PAC’s FEC reports that it made in-kind contributions to
Hunter for President.” Id., ¶ 51. Plaintiffs assert that they are “therefore entitled to relief in the
form of a declaratory order that defendant FEC’s failure to require PTS PAC and Hunter for
President to amend their FEC reports to reflect the receipt of in-kind contributions by PTS PAC
to Hunter for President is contrary to law in violation of 2 U.S.C. § 437g(a)(8).” Id., ¶ 72.
10
As a threshold matter, Plaintiffs must establish their standing to pursue this claim.
Having the right to file an administrative complaint with the FEC does not necessarily give
Plaintiffs standing to seek judicial review of the disposition of that complaint in this Court:
“Section 437g(a)(8)(A) does not confer standing; it confers a right to sue upon parties who
otherwise already have standing.” Common Cause, 108 F.3d at 419. The Court must therefore
consider whether Plaintiffs have established standing in this case.
Article III of the United States Constitution limits the jurisdiction of the federal courts to
resolving “Cases” and “Controversies.” U.S. CONST. art. III, § 2, cl. 1. A party’s standing “is an
essential and unchanging part of the case-or-controversy requirement of Article III.” Lujan, 504
U.S. at 560. To have standing, a party must, at a constitutional minimum, meet the following
criteria. First, the plaintiff “must have suffered an ‘injury in fact’ – an invasion of a legally-
protected interest which is (a) concrete and particularized . . . and (b) ‘actual or imminent, not
“conjectural” or “hypothetical[.]”’” Lujan, 504 U.S. at 560 (citations omitted). Second, “there
must be a causal connection between the injury and the conduct complained of – the injury has to
be ‘fairly . . . trace[able] to the challenged action of the defendant, and not . . . th[e] result [of]
the independent action of some third party not before the court.’” Id. (alterations in original)
(citation omitted). Third, “it must be ‘likely,’ as opposed to merely ‘speculative,’ that the injury
will be ‘redressed by a favorable decision.’” Id. at 561 (citation omitted). A “deficiency on any
one of the three prongs suffices to defeat standing.” U.S. Ecology, 231 F.3d at 24.
The FEC contends Plaintiffs have failed to establish standing to appeal the dismissal of
MUR 5908 under prongs one and three of the Lujan test – i.e., they have failed to allege a
concrete and particularized injury that may be redressed by a favorable decision. Mot. at 1.
11
As to prong one, Plaintiffs assert that they have suffered informational injuries sufficient
to confer standing under the Supreme Court’s decision in FEC v. Akins, 524 U.S. 11 (1988).
Opp. at 18-19. While recognizing that “CREW and Sloan generally allege an informational
interest,” the FEC contends that they have “not identified any specific information they allegedly
lack, let alone how any missing information would be ‘useful in voting.’” Mot. at 13-14
(quoting Common Cause, 108 F.3d at 418). Plaintiffs respond that their Amended Complaint
does identify the specific information lacking: “the ‘in-kind contributions by PTS PAC to Hunter
for President.’” Opp. at 20 (quoting Am. Compl., ¶ 51). Plaintiffs assert that this information
would have helped Sloan, as a voter in presidential elections, and CREW, with its mission of
disseminating information to the public, to “‘evaluate candidates for public office.’” See id. at
19 (quoting in Akins, 524 U.S. at 20).
The Supreme Court in Akins recognized “informational injury” as a basis for standing to
challenge the FEC’s dismissal of a complaint under § 437g(a)(8)(A). Akins arose from an FEC
finding that “the American Israel Public Affairs Committee (AIPAC) is not a ‘political
committee’ as defined by [FECA]” and its subsequent refusal “to require AIPAC to make
disclosures regarding its membership, contributions, and expenditures that FECA would
otherwise require.” Id. at 13. The plaintiffs, a group of voters with views often opposed to
AIPAC’s, sought to challenge that determination by appealing the dismissal of their
administrative complaint under § 437g(a)(8). Id. at 15-18. The government argued that the
plaintiffs lacked standing because they had not suffered an “injury in fact.” Id. at 19.
The Supreme Court found that the “injury of which respondents complain – their failure
to obtain relevant information – is injury of a kind that FECA seeks to address.” Id., 524 U.S. at20 (citing Buckley v. Valeo, 424 U.S. 1, 66-67 (1976) (“political committees” must disclose
12
contributors and disbursements to help voters understand who provides which candidates with
financial support)). The Supreme Court described the informational injury suffered by the Akins
plaintiffs as follows:
The “injury in fact” that respondents have suffered consists of their
inability to obtain information – lists of AIPAC donors (who are,
according to AIPAC, its members), and campaign-related
contributions and expenditures – that, on respondents’ view of the
law, the statute requires that AIPAC make public. There is no
reason to doubt their claim that the information would help them
(and others to whom they would communicate it) to evaluate
candidates for public office, especially candidates who received
assistance from AIPAC, and to evaluate the role that AIPAC’s
financial assistance might play in a specific election. Respondents’
injury consequently seems concrete and particular. Indeed, this
Court has previously held that a plaintiff suffers an “injury in fact”
when the plaintiff fails to obtain information which must be
publicly disclosed pursuant to a statute.
524 U.S. at 21 (citing Public Citizen v. Department of Justice, 491 U.S. 440, 449 (1989)).
Since Akins, the D.C. Circuit has had several occasions to consider the reach of
“informational injury” standing in the context of § 437g(a)(8) claims. In Common Cause, that
court considered whether Common Cause had standing to appeal the FEC’s dismissal of its
administrative complaint against the National Republican Senatorial Committee and the Montana
Republican Party. 108 F.3d 413. The court observed that in a claim based on informational-
injury standing “the nature of the information allegedly withheld is critical to the standing
analysis.” Id. at 417. If, the court held, “the information withheld is simply the fact that a
violation of FECA has occurred, neither Common Cause nor its members have suffered the type
of injury we recognized in Akins.” Id. The court explained: “To hold that a plaintiff can
establish injury in fact merely by alleging that he has been deprived of the knowledge as to
whether a violation of the law has occurred would be tantamount to recognizing a justiciable
interest in the enforcement of the law. This we cannot do.” Id. at 418; see also Judicial Watch,
13
Inc. v. FEC, 180 F.3d 277, 278 (D.C. Cir. 1999). On the other hand, the court suggested in dicta,
if “Common Cause were asserting an interest in knowing how much money a candidate spent in
an election, infringement of such an interest may, under Akins, constitute a legally cognizable
injury in fact.” 108 F.3d at 418. The court did not reach this question, however, as Common
Cause did not allege a violation of such an interest. Id.In Wertheimer v. FEC, 268 F.3d 1070 (D.C. Cir. 2001), the D.C. Circuit again analyzed
the plaintiffs’ standing to appeal an FEC dismissal under § 437g(a)(8), this time arising from
claims under both FECA and the Presidential Election Campaign Fund Act. The Wertheimer
plaintiffs alleged that “notwithstanding the Fund Act’s prohibition on presidential candidates
[who had accepted public financing] accepting contributions from private sources, during the
1996 and 2000 presidential campaigns the two major political parties were funding campaign
advertisements furthering the election of their respective presidential nominees in close
coordination with those candidates.” Id. at 1071. Through their suit, plaintiffs sought “a
declaration that expenditures by political parties that further the election of their respective
presidential candidates, and that are coordinated with those presidential candidates, constitute
contributions to and expenditures by such presidential candidates within the meaning of the Fund
Act,” and which must be publicly disclosed under FECA. Id. The FEC challenged the plaintiffs’
standing there as well.
To establish their standing, the Wertheimer plaintiffs alleged they had been injured by the
Commission’s “failure . . . to implement and construe [FECA] to identify coordinated
expenditures by the major political parties to further the election of their publicly financed
nominees as impermissible ‘contributions’ and ‘expenditures,’” including by denying them
14
information. Id. at 1073. The “FEC’s failure,” the plaintiffs alleged, “deprived them of required
information about the source and amount of candidates’ financing.” Id.
The D.C. Circuit found that the Wertheimer plaintiffs had failed to allege an injury in
fact. The court concluded:
[U]under the Akins test, appellants have failed to show either that
they are directly being deprived of any information or that the legal
ruling they seek might lead to additional factual information. To be
sure, presidential candidates are subject to FECA’s disclosure and
reporting requirements. And FECA requires political parties to
report each disbursement and to label coordinated expenditures as a
discrete category. Yet, appellants’ counsel did not dispute that all
political parties currently report all disbursements or that each
transaction appellants allege is illegal is reported in some form.
During oral argument, counsel for appellants was asked what facts,
specifically, were not being disclosed. Counsel responded that the
‘fact’ of ‘coordination’ was being withheld. But ‘coordination’
appears to us to be a legal conclusion that carries certain law
enforcement consequences. . . . As far as we can determine,
appellants do not really seek additional facts but only the legal
determination that certain transactions constitute coordinated
expenditures. If so, candidates would be required to report
allegedly coordinated expenditures, which currently only political
parties disclose, as disbursements. But that would mean that
appellants only seek the same information from a different source.
Any such increase in information resulting from the imposition of
duplicative reporting requirements seems trivial.
Id. at 1074-75. The court therefore dismissed the case for lack of standing.
In this case, a review of Plaintiffs’ Amended Complaint, the two General Counsel’s
Reports, and the FEC’s Statement of Reasons reveals that, like the Wertheimer plaintiffs, CREW
and Sloan have suffered no informational injury. The amount of money PTS PAC spent on
Hunter’s travel during the “testing the waters” stage of his campaign is publicly available online
in the General Counsel’s Report #2, see Opp., Exh. 4; Am. Compl., ¶ 47, and does not appear to
be in dispute. See Am. Compl., ¶ 42 (“PTS PAC made approximately $10,200 in disbursements
for travel expenses incurred during the same time Congressman Hunter was ‘testing the waters’
15
for his presidential campaign.”). Chart A of Report #2 lists the public events to which Hunter
travelled during the relevant time period and a breakdown showing the portion of PTS PAC’s
$10,243 in expenditures paid for each of those trips. Opp., Exh. 4 at 5. Chart B of Report #2
provides a detailed list of the disbursements PTS PAC made for each relevant advertisement. Id.
at 12.
In trying to pinpoint the factual information they lack, Plaintiffs argue: “[P]aragraph 51
of the amended complaint identifies the specific information lacking here: the ‘in-kind
contributions by PTS PAC to Hunter for President.’” Opp. at 20 (quoting Am. Compl., ¶ 51).
To review, the Hunter Committee had argued that, at a minimum, the $10,243 should be
allocable between PTS PAC and the Hunter Committee, respectively, on a 60%-40% basis.
Report #2 at 8. Such an allocation would result in less than $5,000 in in-kind contributions by
PTS PAC to Hunter, which would not be excessive under § 441a and 11 C.F.R. § 110.2(b)(1).
The General Counsel rejected this suggested allocation, and instead reported to the Commission
that the information gathered from the investigation showed that PTS PAC had, by paying for
Hunter’s travel, made excessive in-kind contributions. Id. at 9. The Commission, however,
declined to adopt the General Counsel’s recommendation, instead finding: “[A]ny disbursements
benefitting both the presidential campaign and PTS PAC would have been allocable between the
two committees. Even if one assumes that PTS PAC and the Hunter Committee benefitted
equally from the disbursements, such an allocation [i.e., $5,100 each] would reduce the amount
of potentially excessive contributions to just over $100.” Statement of Reasons at 3. The
Commission, invoking its prosecutorial discretion, dismissed the claim.
While this may not have been their preferred outcome, it does not deprive Plaintiffs of
any information under Wertheimer. Much like “coordination,” classifying a particular
16
disbursement as an “in-kind contribution” “appears to us to be a legal conclusion that carries
certain law enforcement consequences. . . . As far as we can determine, [Plaintiffs] do not really
seek additional facts but only the legal determination that certain transactions constitute” in-kind
contributions. Wertheimer, 268 F.3d at 1075.
CREW and Sloan simply do not allege any specific factual information they lack that is
not already publicly available in the published FEC documents pertaining to MUR 5908. See
CREW v. FEC, 475 F.3d 337, 339 (D.C. Cir. 2007) (upholding summary judgment for FEC for
lack of standing in part because “any citizen who wants to learn the detail of the transaction . . .
can do so by visiting the Commission’s website, which contains the list and a good deal more”).
Their Opposition reveals what Plaintiffs are actually seeking:
At bottom, the Commission’s arguments flow from a callous
disregard for the legal and practical significance of the FECA’s
reporting requirements. While distinguishing between contributions
and expenditures lies at the heart of the FEC’s mission, the FEC
brushes these distinctions aside, suggesting individuals and entities
like the plaintiffs can learn nothing useful from knowing precisely
which expenditures an entity made and which contributions a
candidate received.
Opp. at 21. Far from asserting even “an interest in knowing how much money a candidate spent
in an election,” as the D.C. Circuit hinted might suffice as an informational injury, see Common
Cause, 108 F.3d at 418, what Plaintiffs want is a reclassification of PTS PAC’s disbursements as
“in-kind contributions” under FECA. See Am. Compl., ¶ 72. Indeed, as relief, Plaintiffs assert
that they “are entitled to . . . a declaratory order that defendant FEC’s failure to require PTS PAC
and Hunter for President to amend their FEC reports to reflect the receipt of in-kind
contributions by PTS PAC to Hunter for President is contrary to law.” Id.17
This simply does not constitute informational injury. Plaintiffs “have failed to show
either that they are directly being deprived of any information or that the legal ruling they seek
might lead to additional factual information.” Wertheimer, 268 F.3d at 1074. As Plaintiffs’
Amended Complaint demands only amended FEC filings to reclassify disbursements of which
they are already aware, and which are already part of the public record, this Court cannot find
that Plaintiffs have standing to bring their claim for wrongful dismissal of MUR 5908.
B. Failure to Provide 60 Days’ Notice
In Count II, Plaintiffs assert that § 437g(a)(8) of FECA “requires the FEC to provide
complainants with 60 days’ notice of any dismissal of their complaint and the basis for such
dismissal.” Am. Compl., ¶ 74. While not contained in any statutory provision, they argue this
requirement is necessary “in order to give meaningful effect to the statutory right to judicial
review conferred on any ‘party aggrieved’ by . . . § 437g(a)(8)(A).” Id., ¶ 76. Plaintiffs claim
that by not immediately notifying Plaintiffs of MUR 5908’s dismissal and by not immediately
releasing its Statement of Reasons for the dismissal, the FEC violated Plaintiffs’ right to appeal
the dismissal within 60 days. Plaintiffs aver that “[b]y the time CREW and Ms. Sloan received
[the] notice of dismissal on July 27, 2010, they had only 34 days remaining in which to file such
a complaint” under § 437g(a)(8)(B), “notwithstanding the 60-day notice period for filing
provided by [FECA].” Id., ¶ 36.
Plaintiffs’ complaints, moreover, are not limited to MUR 5908. Rather, they assert that
this “is not the first time the FEC has denied CREW the full 60 days in which to seek judicial
review of the FEC’s dismissal of its complaint.” Id., ¶ 52. Plaintiffs’ Amended Complaint
describes numerous other instances in which the FEC did not immediately notify a § 437g(a)(8)
complainant of dismissal – at times CREW, and at times other parties – and did not immediately
provide a Statement of Reasons, thereby truncating the 60-day window of appeal. Id., ¶¶ 52-66.
18
Plaintiffs allege that “[i]n nearly all cases the Commission . . . waits days or weeks [after voting
to dismiss a complaint] before communicating the outcome of that vote to the parties, and
typically waits weeks or months longer before providing the basis for any dismissal.” Opp. at
28-29. This, Plaintiffs argue, is evidence that the FEC has an unlawful “policy and practice of
refraining from providing complainants with timely notice of its decisions to dismiss complaints
and the basis for those dismissals.” Am. Compl., ¶ 56. Plaintiffs lack standing on this Count as
well.
Section 437g(a)(8)(B) states: “Any petition under subparagraph (A) shall be filed, in the
case of a dismissal of a complaint by the Commission, within 60 days after the date of the
dismissal.” The Act does not give any timeframe in which a complainant must receive notice of
the dismissal. The D.C. Circuit, however, has previously ruled that the 60-day countdown is
triggered on the day the Commission votes to dismiss the complaint, not on the day the
Commission notifies the complainant of the dismissal. See Spannaus v. FEC, 990 F.2d 643, 644
(D.C. Cir. 1993); Jordan v. FEC, 68 F.3d 518, 519 (D.C. Cir. 1995). This Court is, of course,
powerless to alter that determination.
Here, CREW and Sloan concededly received notice 28 days after the Commission’s vote
to dismiss their Complaint. Am. Compl., ¶ 34. They similarly received the FEC’s Statement of
Reasons six days before the deadline expired. Id., ¶ 40. Although Plaintiffs had filed their suit
by then, they do not allege any prejudice in this case from the disclosure near the end of the 60-
day period. Nor could they since they have since amended their initial Complaint to take the
FEC’s Statement of Reasons into consideration. Where no prejudice exists, Plaintiffs have
suffered no injury that could confer standing.
19
To the extent Plaintiffs are alleging a practice of untimely notice, the D.C. Circuit’s
decision in Jordan is particularly instructive. In that case, Jordan appealed the FEC’s dismissal
of his administrative complaint 63 days after the vote to dismiss, but less than 60 days after the
FEC had sent his notification. 68 F.3d at 519. Jordan argued that “starting the clock on the date
of dismissal might allow the Commission to avoid review by withholding notice of its decision
until the 60-day period expired.” Id. The court declined to take the bait and remanded the case
with directions to dismiss for lack of jurisdiction, writing, “We will face that hypothetical case if
and when it arises.” Id. “For now it is enough to point out that the general counsel’s letter to
Jordan’s attorney was dated July 29, 1991, mailed July 31, 1991, and apparently received on
August 1, 1991. That left Jordan 53 days in which to file his petition.” Id.If the Court of Appeals believes this issue should be adjudicated only when it arises, this
Court will heed that counsel. This is particularly appropriate where Plaintiffs concede that they
do not seek redress for past untimely disclosures. Opp. at 30.
As a result, the Court must reach the same result on the second count of the Amended
Complaint as on the first.
IV. Conclusion
An Order accompanying this Memorandum Opinion will grant Defendant’s Motion to
Dismiss and enter judgment in favor of the Federal Election Commission.
SO ORDERED.
/s/ James E. Boasberg
JAMES E. BOASBERG
United States District Judge
Date: August 1, 2011
20