164 F. Supp. 3d 113
D.D.C.2015Background
- CREW filed FEC complaints (2012) alleging American Action Network and Americans for Job Security were unregistered "political committees" based on substantial federal-election-related ad spending.
- FEC Office of General Counsel recommended investigation, but three Commissioners voted to dismiss; their controlling statements explained the rationale.
- CREW sued in federal district court seeking: (1–2) declarations that the dismissals were arbitrary and contrary to law under FECA and the APA, and (3–4) that the Commissioners’ repeated rationale constituted a "de facto regulation" promulgated without APA notice-and-comment.
- Statutory context: FECA defines "political committee" (per Buckley) and gives the FEC exclusive civil enforcement jurisdiction; FECA provides a specific judicial-review procedure for aggrieved complainants (52 U.S.C. § 30109(a)(8)).
- District court treated the Commissioners’ statements as adjudicative pronouncements, held that announcing principles in adjudication is permissible, and that FECA’s review scheme is the exclusive and adequate remedy precluding APA review.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether repeated Commissioner statements created a "de facto regulation" subject to APA notice-and-comment | CREW: The controlling three-Commissioner rationale has become a binding, across-the-board regulation requiring notice-and-comment. | FEC: Only a four-vote majority can make rules; the statements are adjudicative and not rulemaking. | Court: Statements are adjudicative; announcing new principles in adjudication does not trigger APA notice-and-comment. |
| Whether CREW may challenge the Commissioners’ statements under the APA | CREW: APA review is appropriate because the statements operate as a substantive rule affecting nonparties. | FEC: FECA provides an exclusive, adequate judicial-review scheme that precludes APA review. | Court: FECA’s detailed review procedure is the exclusive and adequate remedy; APA review barred. |
| Whether FECA’s judicial-review procedure is inadequate for CREW’s "across-the-board" challenge | CREW: The FECA process is inadequate because it can require conciliation and allow Commissioners to change rationale later, undermining relief. | FEC: Those features are part of the statutory scheme; they do not render review inadequate. | Court: FECA’s remedies are adequate; CREW must challenge individual dismissals under §30109. |
| Whether the court should substitute its policy judgment for FEC’s choice of adjudication over rulemaking | CREW: Implied that broader rulemaking would be more appropriate. | FEC: Agency has discretion to choose adjudication and announce principles there. | Court: Courts may not substitute their judgment; agencies have broad discretion to proceed by adjudication. |
Key Cases Cited
- N.L.R.B. v. Bell Aerospace Co. Div. of Textron, Inc., 416 U.S. 267 (agency may choose adjudication over rulemaking; can announce new principles in adjudication)
- SEC v. Chenery Corp., 332 U.S. 194 (agencies have discretion to decide between rulemaking and adjudication)
- Buckley v. Valeo, 424 U.S. 1 (definition and limits of "political committee" under FECA)
- Conference Group, LLC v. FCC, 720 F.3d 957 (adjudicative orders that have prospective effect are not automatically rulemaking subject to APA §553)
- N.Y. State Comm’n on Cable Television v. FCC, 749 F.2d 804 (adjudication may affect agency policy without triggering notice-and-comment)
- Stockman v. FEC, 138 F.3d 144 (FECA’s judicial-review scheme as exclusive remedy for challenging FEC enforcement)
- Block v. Cmty. Nutrition Inst., 467 U.S. 340 (alternative statutory review procedures can preclude APA review)