Campaign Legal Ctr. v. Fed. Election Comm'n, Case No. 20-cv-00730

CourtUnited States District Courts. United States District Court (Columbia)
Writing for the CourtCHRISTOPHER R. COOPER United States District Judge
Docket NumberCase No. 20-cv-00730
Decision Date19 February 2021

RIGHT TO RISE SUPER PAC, INC., Intervenor-Defendant.

Case No. 20-cv-00730


February 19, 2021


While Jeb Bush's unsuccessful 2016 presidential campaign may seem like a footnote in political history given all that has transpired since, it continues to attract the attention of organizations dedicated to exposing violations of federal campaign finance laws. Election junkies will recall that before the former Florida governor formally launched his candidacy in the summer of 2015, the Right to Rise super PAC, which directly supported his run, had already amassed approximately $90 million in donations. The accumulation of such a large war chest, coupled with Mr. Bush's fundraising activities and travels to early primary states in advance of his official announcement, raised the eyebrows of watchdog groups Campaign Legal Center and Democracy 21. Suspecting that the Bush campaign and Right to Rise were improperly coordinating their efforts and thereby violating applicable contribution limits and disclosure requirements, the groups filed administrative complaints with the Federal Election Commission ("FEC"). But the complaints languished without action for nearly five years. Undaunted, the groups sued the FEC in this Court to compel the agency to investigate the asserted violations.

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They bring claims under the Federal Election Campaign Act ("FECA") and the Administrative Procedure Act ("APA").

Right to Rise intervened as a defendant in the case and now moves to dismiss. It contends that plaintiffs lack standing to bring a FECA claim because they have not suffered a cognizable injury. And it argues that plaintiffs' APA claim is foreclosed by the availability of judicial review under FECA. Finding that plaintiffs have plausibly alleged an informational injury, the Court concludes that they have standing to sue and will exercise jurisdiction over their FECA claim. The Court agrees with Right to Rise, however, that the complaint fails to state a claim under the APA.

I. Background

A. Procedural Background

Plaintiffs Campaign Legal Center and Democracy 21 claim that the FEC has failed to act on their administrative complaints alleging that John Ellis ("Jeb") Bush and defendant-intervenor Right to Rise Super PAC, Inc., violated provisions of the Federal Election Campaign Act over the course of Bush's 2016 presidential bid. Specifically, plaintiffs assert that Bush coordinated with Right to Rise in an attempt to contravene FECA's "soft money" prohibition, which provides that any entity "established, financed, maintained or controlled by or acting on behalf of" a federal candidate must abide by FECA's "limitations, prohibitions, and reporting requirements[.]" 52 U.S.C. § 30125(e)(1); see Compl. ¶ 2, ECF No. 1.

In the spring of 2015, plaintiffs lodged two complaints with the FEC detailing their concerns. Compl. ¶ 4. First, in March 2015, plaintiffs filed a complaint alleging that Bush failed to abide by FECA's (i) "testing-the-waters" disclosure requirements, (ii) campaign contribution limits, (iii) candidate registration requirements, and (iv) soft money prohibition. Compl. Ex. B,

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Mar. Admin. Compl., ECF No. 1-2 ("Mar. Admin. Compl."). A few months later, plaintiffs filed another complaint making similar allegations and expanding upon its claim that Bush "established" and "controlled" Right to Rise to raise millions of dollars on his behalf without regard to FECA's contribution limits and source prohibitions. Compl. Ex. A, May Admin. Compl., ECF No. 1-1 ("May Admin. Compl."). Plaintiffs requested that the FEC "undertake an investigation under 52 U.S.C. § 30109 of respondents Bush and [Right to Rise] to determine whether [they] have violated the law by accepting contributions or making expenditures with funds raised in excess of the applicable limits under" FECA. Id. at 17 (citing 52 U.S.C. § 30116(a)(1) and 11 C.F.R. § 110.3).

Plaintiffs' administrative complaints sat without action for nearly five years. Plaintiffs responded by filing the present complaint seeking injunctive and declaratory relief to compel the FEC to take up the complaints. See Compl. ¶ 2. Plaintiffs allege that the Commission's inaction has deprived them of information on the extent of coordination between Right to Rise and the Bush campaign, id. ¶ 9, and the extent of Bush's campaign spending "both during the testing the waters phase of his campaign and after . . . Bush had moved beyond testing the waters to become a candidate under FECA," id. ¶ 10 (cleaned up). Plaintiffs also allege that they have suffered organizational injuries as a result of the FEC's inaction, because inadequate disclosure of federal campaign finance activity diverts funds and resources from other organizational needs. Id. ¶¶ 19, 22.

Plaintiffs bring two counts to redress their alleged injuries. In Count I, they claim that the FEC's "failure to act on plaintiffs' administrative complaints within 120 days of their filing was contrary to law" under FECA. Id. ¶ 37 (citing 52 U.S.C. § 30109(a)(8)(A)). And in Count II,

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they contend that the same inaction constitutes "unlawfully withheld and unreasonably delayed agency action under 5 U.S.C. § 706(1)" of the APA. Id. ¶ 39.

Since the filing of plaintiffs' complaint, the FEC has neither acted on plaintiffs' administrative complaints nor entered an appearance in this lawsuit. In June 2020, Right to Rise moved to intervene as a defendant, which the Court promptly permitted. See Mot. to Intervene, ECF No. 9; June 8, 2020, Min. Order. Right to Rise then moved to dismiss plaintiffs' complaint on the grounds that plaintiffs lack standing to bring their FECA claim and that their APA claim is precluded by FECA's comprehensive judicial review provisions. See Mot. to Dismiss, ECF No. 11. Right to Rise's motion is ripe for the Court's review.

B. Statutory Scheme

The Court will first describe FECA's pertinent campaign finance and disclosure requirements before turning to its enforcement provisions.

1. FECA requirements

FECA was passed in 1971 to "remedy any actual or perceived corruption in the political process[.]" FEC v. Akins, 524 U.S. 11, 14 (1998). To that end, FECA "imposes limits upon the amounts that individuals, corporations, 'political committees' (including political action committees), and political parties can contribute to a candidate for federal political office." Id.; see 52 U.S.C. § 30116(a) (listing limitations on contributions and expenditures); see also 11 C.F.R. §§ 300.60, 300.61. Additionally, FECA "imposes limits on the amount these individuals or entities can spend in coordination with a candidate," and treats coordinated expenditures as "contributions" under the Act. Akins, 524 U.S. at 14; see 52 U.S.C. § 30101(8)(A) (defining "contribution" to include "anything of value [given] by any person for the purpose of influencing any election for Federal office," as well as "the payment by any person of compensation for the

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personal services of another person which are rendered to a political committee without charge for any purpose"); see also FEC v. Colo. Republican Fed. Campaign Comm., 533 U.S. 431, 438 (2001) ("Expenditures coordinated with a candidate . . . are contributions under the Act."). FECA incorporates coordinated expenditures in order to "prevent attempts to circumvent the Act through prearranged or coordinated expenditures amounting to disguised contributions." Buckley v. Valeo, 424 U.S. 1, 47 (1976). By definition, coordinated expenditures are "in-kind contributions, as opposed to direct financial ones, since they are services rendered to the campaign." Campaign Legal Ctr. v. FEC, 466 F. Supp. 3d 141, 146 (D.D.C. 2020) ("CLC II").

FECA imposes certain disclosure and reporting requirements on anyone who becomes a "candidate," which FECA defines as "an individual who seeks nomination for election, or election, to Federal office," 52 U.S.C. § 30101(2), including any individual who has accumulated an aggregate of over $5,000 in contributions or expenditures, id. § 30101(2)(A); see also 11 C.F.R. § 100.3(a); 52 U.S.C. § 30101(8)(A) (defining contribution); id. § 30101(9)(A) (defining expenditure). Individuals must register with the FEC within ten days of qualifying as a candidate under FECA. See 52 U.S.C. § 30103(a). Within fifteen days of so qualifying, candidates must designate a principal campaign committee, id. § 30102(e)(1), which, in turn, must regularly file comprehensive reports that disclose their receipts and disbursements, id. § 30104(a).

FECA contains limited exceptions to the $5,000 threshold for individuals wishing to "test the waters" of a potential candidacy. See 11 C.F.R. §§ 100.72, 100.131 (testing-the-waters exceptions). The testing-the-waters exceptions permit would-be candidates to evaluate the feasibility of candidacy without triggering candidate status when the funds they raise or spend for that purpose exceed $5,000. See id. That said, potential candidates must record all funds received and payments made pursuant to the testing-the-waters exceptions and, should they

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eventually become a candidate, disclose those transactions in their principal campaign committee's first report. Id. § 101.3.

FECA's testing-the-waters exceptions do not apply to individuals who have decided (either privately or publicly) that they will run for office. Id. §§ 100.72(b); 100.131(b); see also FEC Adv. Op. 1981-32 (Oct. 2, 1981). The regulations thus attempt to distinguish between activities that "indicate that a decision has been made to seek nomination for election, or election, to a Federal office" from those that indicate that an individual is truly "continuing to deliberate whether [he or she] should actually seek elective Federal office." Id. at 4. "Examples of activities that indicate that an individual has decided...

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