McChesney v. Petersen, 275 F. Supp. 3d 1123

Background

The FEC assessed a $12,122 administrative fine against McLeay Committee and its treasurer for failing to file multiple 48‑hour contribution notices during the May 13, 2014 Nebraska U.S. Senate primary (contributions totaling $112,425.06).
Plaintiffs challenged the fines administratively, arguing the FEC had not lawfully established the penalty schedule by the 2014 regulatory extension and therefore lacked authority to apply the schedule to their violations.
The FEC’s 2014 Regulatory Extension updated the end date for the Administrative Fines Program and deleted a payment provision; the FEC promulgated it without notice and comment, invoking the APA good‑cause exceptions because the rule was non‑substantive and Congress had already extended the program in December 2013.
Plaintiffs filed suit seeking declaratory and APA relief and review under FECA; the FEC moved to dismiss, arguing FECA provides the exclusive and adequate remedy and that the 2014 extension was valid under the APA good‑cause exceptions.
The district court found the administrative record sufficient for review, that plaintiffs had satisfied FEC regulation §111.35’s minimal preconditions for administrative challenge, and that the FEC had good cause to bypass notice and comment and the delayed‑effective‑date requirement for the 2014 extension.
The court dismissed plaintiffs’ declaratory and APA claims for lack of proper forum (FECA channels review) and dismissed the remaining FECA challenge on the merits, upholding the 2014 Regulatory Extension and dismissing the case with prejudice.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether plaintiffs may seek declaratory/APA relief instead of FECA review	McLeay: APA/declaratory relief available because rulemaking was invalid	FEC: FECA supplies exclusive, adequate review; APA review precluded	Held: FECA review is the exclusive/adequate remedy; declaratory and APA claims dismissed
Whether plaintiffs raised proper administrative challenges under 11 C.F.R. §111.35	McLeay: §111.35 cannot limit legal defenses; FEC’s procedure was unlawful	FEC: §111.35 limits challenges to factual error, miscalculation, or best efforts	Held: Plaintiffs met §111.35(b) by asserting factual error; threshold satisfied for FECA review
Whether the 2014 Regulatory Extension violated the APA notice, comment, or delayed‑effective‑date requirements	McLeay: Extension was substantive and required notice; invalid without notice/comment	FEC: Extension was non‑substantive, merely extended Congress’s action; good cause justified bypassing notice and 30‑day publication	Held: FEC demonstrated good cause under §§553(b) and (d); notice and delay excused; extension valid
Whether procedural voting/Sunshine Act defects invalidate the extension	McLeay: Tally vote/Sunshine Act irregularities (no sworn certification) invalidate rule	FEC: Any defects concern transparency, not validity; no intentional/prejudicial violations alleged	Held: Alleged defects do not warrant vacatur; remedy is disclosure, not invalidation

Key Cases Cited

Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (pleading must state a plausible claim)
Ashcroft v. Iqbal, 556 U.S. 662 (legal conclusions not accepted as factual allegations)
Bowen v. Massachusetts, 487 U.S. 879 (APA review precluded where Congress provided special, adequate review)
Citizens to Preserve Overton Park v. Volpe, 401 U.S. 402 (standard for arbitrary and capricious review under the APA)
Combat Veterans for Congress Political Action Committee v. Fed. Election Comm’n, 795 F.3d 151 (describing purpose of Administrative Fines Program)
U.S. Steel Corp. v. U.S. E.P.A., 605 F.2d 283 (good cause more readily shown for dispensing with delayed publication)
Mack Trucks, Inc. v. E.P.A., 682 F.3d 87 (narrow construction of the APA good‑cause exception)
Gorog v. Best Buy Co., 760 F.3d 787 (documents embraced by the complaint may be considered on a Rule 12 dismissal)