Stop This Insanity Inc. Employee Leadership Fund v. Federal Election Commission, 761 F.3d 10

Background

Stop This Insanity, Inc. (STII) is a corporation that converted from a standalone PAC into a connected separate segregated fund (the Employee Leadership Fund) and asked the FEC whether the Fund could open an unrestricted account to make independent expenditures and solicit the general public.
Federal Election Campaign Act permits corporations limited political participation via separate segregated funds (PACs) subject to organizational, reporting, and solicitation limits (e.g., solicit only stockholders, executives, employees and families; limited solicitations twice yearly).
Citizens United removed the ban on corporate independent expenditures, making segregated funds largely unnecessary for that purpose, though they still exist with statutory solicitation and disclosure tradeoffs.
The FEC provided inconsistent internal memoranda and declined to issue an advisory opinion; STII sued, challenging the solicitation and disclosure restrictions as unconstitutional and moved for a preliminary injunction.
The district court dismissed the complaint; STII appealed. The D.C. Circuit reviews the dismissal de novo and affirms.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether solicitation restrictions on connected segregated funds are unconstitutional under Citizens United and Buckley	Citizens United eliminated organizational distinctions; segregated-fund solicitation restrictions must face strict scrutiny and fail	Restrictions regulate fundraising and disclosure, not an outright ban on independent expenditures; the corporation can spend independently without using the Fund	Court rejects plaintiff: Citizens United inapposite; restrictions survive review
Whether segregated-fund disclosure/solicitation limits are severable so Fund can solicit publicly while avoiding disclosure	STII argues severability should permit elimination of solicitation limits while retaining disclosure waivers	Government questions severability and argues the statutory scheme functions as a package; disclosure interest is substantial	Court does not reach severability because merits favor Government; disclosure interest justified restrictions
Whether the Fund should be assessed in isolation for First Amendment purposes or as part of the corporate whole	STII treats the Fund in isolation to claim a substantial burden on speech	Government argues the Fund and corporation overlap; corporation can make independent expenditures, making any burden theoretical	Court holds that corporate alternative undermines STII’s claim; if assessed in isolation, restrictions still meet governmental interests
Governmental interest justifying disclosure/solicitation limits (quid pro quo only?)	STII: only anti-corruption/quid-pro-quo rationale can justify campaign finance regulation here, and it’s absent	FEC: broader informational/disclosure interest (public’s right to know who seeks to influence votes) and administrative/regulatory interests justify the rules	Court accepts FEC’s informational/anticorruption rationale and upholds the restrictions

Key Cases Cited

Beaumont v. FEC, 539 U.S. 146 (discusses corporate participation limits under FECA)
Citizens United v. FEC, 558 U.S. 310 (corporate independent-expenditure rule; PACs as alternatives)
Buckley v. Valeo, 424 U.S. 1 (framework for scrutiny of contribution vs. expenditure limits)
McConnell v. FEC, 540 U.S. 93 (solicitation limits and corporate PAC rules)
National Right to Work Committee v. FTC, 459 U.S. 197 (separate segregated funds and corporate control)
FEC v. NRA Political Victory Fund, 254 F.3d 173 (D.C. Cir.) (discussion of corporate control over PACs)
EMILY's List v. FEC, 581 F.3d 1 (D.C. Cir.) (unlimited expenditure accounts for hybrid PACs)
SpeechNow.org v. FEC, 599 F.3d 686 (D.C. Cir. en banc) (disclosure interests and organizational/reporting requirements)
McCutcheon v. FEC, 134 S. Ct. 1434 (plurality) (discusses disclosure’s informational role in modern context)