Stop This Insanity Inc Employee Leadership Fund v. Federal Election Commission
902 F. Supp. 2d 23
D.D.C.2012Background
- Leadership Fund (an SSF) seeks to challenge FECA limits on connected PACs: §441a(a)(1)(C), §441a(a)(3) and §441b(b)(4)(A)(i) as applied to its hybrid activities of direct contributions and independent expenditures.
- Leadership Fund is connected to STI, a 501(c)(4) social-welfare organization; SSFs may be subsidized by corporations but must solicit within a restricted universe.
- Leadership Fund proposed a separate independent-expenditure-only account to raise unlimited contributions for independent expenditures, not used for direct contributions.
- FEC issued two advisory opinions (Draft A favorable; Draft B unfavorable) and later a 3-3 vote to approve either draft; no advisory opinion issued thus no clearance to proceed with unlimited solicitations.
- Court granted FEC’s motion to dismiss and denied preliminary injunction; court held contribution and solicitation limits constitutional as applied to Leadership Fund when treated as a single entity, and that separate independent-expenditure accounts could exist but not circumvent limits.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Constitutionality of contribution limits as applied to a hybrid connected PAC | Glengary/Cefaratti argue limits infringe First Amendment rights | FEC argues limits serve anti-corruption interests and apply to hybrids | Limits constitutional as applied to Leadership Fund when maintaining as one entity |
| Validity of solicitation restrictions on SSFs for a connected PAC | Plaintiffs seek broader solicitation of general public for unlimited independent expenditures | Restrictions necessary to prevent corruption and protect employee rights | Solicitation restrictions upheld; broader public solicitation not allowed for connected SSFs |
| Whether the existence of a separate independent-expenditure account undermines anti-corruption interests | Hybrid model should allow unlimited independent expenditures | Hybridization does not negate corruption risk; separate accounts insufficient to avoid appearance of influence | Hybrid structure does not nullify anti-corruption interests; unified perception persists; not enough to grant injunction to allow unlimited solicitations |
Key Cases Cited
- Citizens United v. FEC, 130 S. Ct. 876 (U.S. 2010) (independent expenditures do not give rise to corruption; speech by corporations valid)
- SpeechNow.org v. FEC, 599 F.3d 686 (D.C. Cir. 2010) (contribution limits unconstitutional for independent-expenditure-only groups)
- EMILY’s List v. FEC, 581 F.3d 1 (D.C. Cir. 2009) (hybrid nonprofit with hard-money constraints; implications for non-connected groups)
- Carey v. FEC, 791 F. Supp. 2d 120 (D.D.C. 2011) (hybrid non-connected PACs may combine direct contributions with independent expenditures)
- Cal. Med. Ass’n v. FEC, 453 U.S. 182 (U.S. 1981) (concerns about unlimited administrative support funds and dominance by donors)
- Buckley v. Valeo, 424 U.S. 1 (U.S. 1976) (contribution limits serve anti-corruption interests; expenditures treated more strictly)