466 F.Supp.3d 141
D.D.C.2020Background
- In October 2016 Campaign Legal Center (CLC) filed an FEC administrative complaint alleging Correct the Record (CTR) coordinated with Hillary for America (HFA) to provide nearly $6M in unreported in-kind (coordinated) contributions.
- The FEC Office of General Counsel (OGC) recommended finding "reason to believe," but with only four of six commissioners present the Commission deadlocked 2–2 and dismissed the matter.
- The dismissal turned on an interpretation of the FEC’s "internet-communications" rule: whether unpaid online communications (and related production costs) are exempt from coordination/contribution rules.
- The FEC lacked the four votes needed to defend the dismissal in court; HFA and CTR intervened and moved to dismiss CLC’s suit challenging the dismissal as "contrary to law" under 52 U.S.C. § 30109(a)(8).
- The District Court found that CLC has both informational and organizational standing to sue, and that the Amended Complaint plausibly alleges (a) the Commission adopted an impermissible interpretation of the internet rule that would eviscerate FECA’s coordination rules, and (b) the dismissal was arbitrary and capricious in light of substantial evidence of coordination.
- The Court denied the intervenors’ motion to dismiss; it also declined to resolve at this stage whether the APA claim is precluded by FECA, reserving that question for later proceedings.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Standing (informational) | CLC lacks access to itemized disclosures that would be required if CTR/HFA coordination were treated as contributions; that informational denial is a concrete injury. | Intervenors contend the information CLC seeks is already publicly available. | Court: CLC plausibly alleges an informational injury; disclosure sought would be new and helpful — standing satisfied. |
| Organizational standing | CLC diverts resources to assist reporters and to investigate; this is a concrete drain on its activities and redresses its mission. | Intervenors argue CLC fails to allege resource depletion or a cognizable organizational injury. | Court: CLC sufficiently pleads diversion/use of resources and impairment to its mission — organizational standing satisfied. |
| Whether FEC dismissal rested on an impermissible interpretation of FECA (internet-communications rule) | The controlling Commissioners’ expansive reading — exempting broad "production" costs for unpaid internet content — conflicts with FECA, FEC precedent, and would swallow coordination rules. | Intervenors defend the Commissioners’ interpretation as consistent with precedent and the regulation. | Court: Plaintiffs plausibly plead the interpretation is not "sufficiently reasonable" and could vitiate FECA; survives 12(b)(6). |
| Whether dismissal was arbitrary, capricious, or an abuse of discretion | OGC found systematic coordination and significant non-communication-specific expenditures that likely were coordinated; Commissioners ignored or misapplied this evidence. | Intervenors argue evidence does not show coordination or was properly considered. | Court: Amended Complaint plausibly alleges the dismissal ran counter to evidence (including misapplied media exemption) — not vulnerable to dismissal. |
| APA claim (challenge to interpretation/application) | CLC seeks APA review of the regulation/interpretation as arbitrary and contrary to law. | Intervenors argue FECA’s special enforcement/judicial-review scheme provides an adequate alternative remedy and precludes APA review. | Court: Declined to dismiss the APA count at this stage; precedent is mixed and the Court will address at summary judgment. |
Key Cases Cited
- FEC v. Akins, 524 U.S. 11 (1998) (FECA disclosure statutes support broad standing for informational injuries)
- Buckley v. Valeo, 424 U.S. 1 (1976) (coordinated expenditures are contributions subject to regulation)
- FEC v. Colo. Republican Fed. Campaign Comm., 533 U.S. 431 (2001) (coordinated expenditures treated as contributions)
- Shays v. FEC, 414 F.3d 76 (D.C. Cir. 2005) (tests for when communications are "coordinated" and discussion of internet rules)
- Spokeo, Inc. v. Robins, 136 S. Ct. 1540 (2016) (standing elements: concrete, particularized injury)
- FEC v. Democratic Senatorial Campaign Comm’n, 454 U.S. 27 (1981) (degree of deference to agency construction)
- Orloski v. FEC, 795 F.2d 156 (D.C. Cir. 1986) (standard for reviewing FEC dismissal as "contrary to law")
- Common Cause v. FEC, 108 F.3d 413 (D.C. Cir. 1997) (agency dismissal review limited to impermissible interpretation or arbitrary/capricious action)
- Motor Vehicle Mfrs. Ass’n v. State Farm, 463 U.S. 29 (1983) (APA arbitrary-and-capricious standard)
- Campaign Legal Ctr. v. FEC, 952 F.3d 352 (D.C. Cir. 2020) (recent D.C. Circuit decision recognizing CLC’s informational standing in a FECA disclosure suit)