[EL] query on 501c4 IEs and the FEC PAC rules

Fri Mar 16 16:07:11 PDT 2012

You are likely to be correct on both, Rick.  Your predictions are sound.

But, with regard to your point 2. below, I hope you will entertain the
possibility that some Commissioners may find a major purpose of campaign
activity at too low a threshold, if you will, or on subjective criteria.

Good weekend,

Steve

On Fri, Mar 16, 2012 at 6:50 PM, Rick Hasen <rhasen at law.uci.edu> wrote:

>  Of course each such claim will have to be investigated individually.
>
> I am making two predictions
>
> 1. there will be (or already are) 501c4 groups which will engage in enough
> electioneering that under a fair reading of the "major purpose" test the
> group should have (but didn't) register as PACs; and
> 2. if complaints are filed, and the composition of the FEC is as it is
> now, the FEC will deadlock on party lines as to whether such groups should
> have registered as PACs under the major purpose test.
>
> I will be happy if I am wrong on either or both.
>
> Rick
>
>
> On 3/16/12 3:45 PM, Steve Hoersting wrote:
>
> Respectfully, it seems the following statement puts the *penalizing cart*before the
> *investigative* *horse*:
>
> and lawsuits against the FEC if it does not *take action against* such
> groups *for violating the PAC rules.*
>
> Best,
>
> Steve
>
>
> On Fri, Mar 16, 2012 at 6:38 PM, Rick Hasen <rhasen at law.uci.edu> wrote:
>
>> It seems to me that there will likely be excesses in this election by
>> c4s which are acting as shadow super PACs, which will lead to
>> complaints, potential investigations, and lawsuits against the FEC if it
>> does not take action against such groups for violating the PAC rules.
>>
>> Thanks to both of you and to others who weighed in on this issue in
>> private messages.
>>
>>
>> On 3/16/12 3:34 PM, Trevor Potter wrote:
>> > Presumably John's comments that c4s claim " validly" that they do not
>> have as their "major purpose" the influencing of federal elections do not
>> apply universally to all entities that chose to claim c4 status. Rather,
>> that is a factual question to be answered by each entity that expends more
>> than a significant portion of their resources on federal election activity.
>> > Trevor Potter
>> >
>> > Sent from my iPad
>> >
>> > On Mar 16, 2012, at 6:25 PM, "John Pomeranz"<jpomeranz at harmoncurran.com>
>>  wrote:
>> >
>> >> Correct.  501(c)(4)s argue (validly, I think) that their "major
>> purpose" is not efforts to influence federal elections.  Significant
>> support for that argument comes from the tax law's requirements for
>> 501(c)(4) status.  To qualify for its exemption from federal income tax, a
>> 501(c)(4) must have a primary "social welfare" purpose, which does not
>> include efforts to intervene in any political campaign.
>> >>
>> >> There was some interesting debate on these issues, including the
>> intersection of FECA's (or, really, the Supreme Court's) "major purpose"
>> and the tax law's "primary purpose," during the FEC's efforts to craft a
>> political committee rule in 2004.   Yet what constitutes major purpose and
>> primary purpose remain, as you know, a hot topic of debate.
>> >>
>> >>
>> >> John Pomeranz
>>  >> Harmon, Curran, Spielberg&  Eisenberg, LLP
>>  >> 1726 M Street, NW, Suite 600
>> >> Washington, DC  20036
>> >> office: 202.328.3500
>> >> mobile: 703.597.7663
>> >> fax: 202.328.6918
>> >> e: jpomeranz at harmoncurran.com
>> >>
>> >>
>> >>
>> >> -----Original Message-----
>> >> From: law-election-bounces at department-lists.uci.edu [mailto:
>> law-election-bounces at department-lists.uci.edu] On Behalf Of Rick Hasen
>> >> Sent: Friday, March 16, 2012 6:07 PM
>> >> To: law-election at uci.edu
>> >> Subject: [EL] query on 501c4 IEs and the FEC PAC rules
>> >>
>> >> I understand that in this election cycle and the last (since CU) 501c4
>> organizations (which did not qualify as MCFL/QNC corporations) have been
>> running not just electioneering communications ads, but also making
>> independent expenditures (including express advocacy).
>> >> How do 501c4s which are making IEs argue that they need not register
>> with the FEC as a political action committee?  Are they arguing that
>> electioneering is not their major purpose (along the lines of how they
>> argue to the IRS that election related activity is not the "primary
>> activity" for tax purposes)?
>> >>
>> >> Thanks.
>> >> Rick
>> >> --
>> >> Rick Hasen
>> >> Chancellor's Professor of Law and Political Science UC Irvine School
>> of Law
>> >> 401 E. Peltason Dr., Suite 1000
>> >> Irvine, CA 92697-8000
>> >> 949.824.3072 - office
>> >> 949.824.0495 - fax
>> >> rhasen at law.uci.edu
>> >> http://law.uci.edu/faculty/page1_r_hasen.html
>> >> http://electionlawblog.org
>> >> _______________________________________________
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>>
>> --
>> Rick Hasen
>> Chancellor's Professor of Law and Political Science
>> UC Irvine School of Law
>> 401 E. Peltason Dr., Suite 1000
>> Irvine, CA 92697-8000
>> 949.824.3072 - office
>> 949.824.0495 - fax
>> rhasen at law.uci.edu
>> http://law.uci.edu/faculty/page1_r_hasen.html
>> http://electionlawblog.org
>> _______________________________________________
>> Law-election mailing list
>> Law-election at department-lists.uci.edu
>> http://department-lists.uci.edu/mailman/listinfo/law-election
>>
>
>
>
> --
> Stephen M. Hoersting
>
>
> --
> Rick Hasen
> Chancellor's Professor of Law and Political Science
> UC Irvine School of Law
> 401 E. Peltason Dr., Suite 1000
> Irvine, CA 92697-8000
> 949.824.3072 - office
> 949.824.0495 - fax
> rhasen at law.uci.edu
> http://law.uci.edu/faculty/page1_r_hasen.html
> http://electionlawblog.org
>

-- 
Stephen M. Hoersting
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