[EL] big 2d Circuit campaign finance case; more news
Rick Hasen
rhasen at law.uci.edu
Wed Jul 2 14:11:20 PDT 2014
Well it sounds like Mr. Bopp has announced to the listserv (and
therefore the world) that he will file a cert. petition in the Supreme
Court.
On 7/2/14, 2:02 PM, Benjamin Barr wrote:
> Brad,
>
> I think the primary analytical error by the Second Circuit is blotting
> the rather technical analysis of what legal separation means in this
> context and lumping this into into a new, hazy "financial enmeshment"
> theory. The legal standard has always focused on technical elements
> of separation, like the FEC's coordination approach, or the IRS'
> guidance on individuals sharing defined roles between related C3s and
> C4s. It's never been focused on a feeling or hunch about how close
> two groups may be. This is the same sort of confusion that marred the
> Jon Doe prosecution in Wisconsin--supplanting technical, objective
> standards with "feels like" coordination, "feels like" "financial
> enmeshment" guideposts.
>
> Good law and good rulings aren't based on good feelings about legal
> standards. Here's hoping an en banc Second Circuit realizes this.
>
> Forward,
>
> B
>
>
> On Wed, Jul 2, 2014 at 4:31 PM, Smith, Brad <BSmith at law.capital.edu
> <mailto:BSmith at law.capital.edu>> wrote:
>
> This raises a good question Ben - may a corporation that maintains
> a PAC be prohibited, under this decision, from making independent
> expenditures in accordance with Citizens United? I don't think so,
> but that would seem to be the Second Circuit's logic.
>
>
> /Bradley A. Smith/
>
> /Josiah H. Blackmore II/Shirley M. Nault/
>
> / Professor of Law/
>
> /Capital University Law School/
>
> /303 E. Broad St./
>
> /Columbus, OH 43215/
>
> /614.236.6317 <tel:614.236.6317>/
>
> /http://law.capital.edu/faculty/bios/bsmith.aspx/
>
> ------------------------------------------------------------------------
> *From:* law-election-bounces at department-lists.uci.edu
> <mailto:law-election-bounces at department-lists.uci.edu>
> [law-election-bounces at department-lists.uci.edu
> <mailto:law-election-bounces at department-lists.uci.edu>] on behalf
> of Benjamin Barr [benjamin.barr at gmail.com
> <mailto:benjamin.barr at gmail.com>]
> *Sent:* Wednesday, July 02, 2014 4:21 PM
> *To:* Edward Still
> *Cc:* law-election at UCI.edu
>
> *Subject:* Re: [EL] big 2d Circuit campaign finance case; more news
>
> I'm curious about the findings of fact by the lower court.
>
> The Second Circuit views the related Vermont Right to Life
> entities as mere bank accounts--shells without formal
> organizational separation. But the case law underlying decisions
> like /EMILY's List/ and /Carey/ inform that a PAC is a separate
> organization from the main organization, or from other PACs/. /And
> there is both a special fluidity and rigidity about roles held by
> individuals in these groups--they may serve in various related
> organizations so long as they wear their proverbial separate hats
> and follow rules preventing the sharing of certain information or
> resources. These sort of arrangements are common across a wide
> array of non-profit entities, as Ed and Byron note. To impose
> stricter requirements would be to impose onerous staffing and
> personnel requirements on already-strained non-profits in the
> quixotic pursuit of ending "corruption."
>
> That sort of overly rigid formality is what came to the fore in
> /Carey/, a case I brought with Steve Hoersting, Dan Backer, and
> Allen Dickerson a few years back. If the FEC had its way, we
> would have needed to clone the group in question, a meagerly
> funded veterans organization, to engage in meaningful advocacy.
> But the court understood that separate, segregated accounts and
> following the applicable rules means that related entities can,
> indeed, be related and be so bold as to speak and engage the
> public about elections.
>
> The Second Circuit seems confused about groups being "enmeshed
> financially" without understanding how formal rules of separation
> for related entities work. I do hope en banc reconsideration
> cures this confusion.
>
> Forward,
>
> Benjamin Barr
>
>
>
> On Wed, Jul 2, 2014 at 3:50 PM, Edward Still <still at votelaw.com
> <mailto:still at votelaw.com>> wrote:
>
> Byron has a good point. Here is a list of national groups I
> used as examples recently:
>
> a.EMILY'S List (hard money and soft money accounts)
>
> b.U.S. Chamber of Commerce (& its PAC)
>
> c.Sierra Club (& its Political Committee)
>
> d.League of Conservation Voters (& Education Fund)
>
> e.AFL-CIO (and COPE)
>
> f.NAACP (& its National Voter Fund)
>
> g.Human Rights Campaign (& its Federal PAC)
>
> In each of these cases, one organization engages in one type
> of political activity and its sister engages in another.
>
> Ed
>
> Edward Still
> Edward Still Law Firm LLC
> 130 Wildwood Parkway STE 108-304
> Birmingham AL 35209
> 205-320-2882 <tel:205-320-2882>
> still at votelaw.com <mailto:still at votelaw.com>
> www.votelaw.com/blog <http://www.votelaw.com/blog>
> www.edwardstill.com <http://www.edwardstill.com>
> www.linkedin.com/in/edwardstill
> <http://www.linkedin.com/edwardstill>
>
>
>
>
> On Wed, Jul 2, 2014 at 2:08 PM, Byron Tau <btau at politico.com
> <mailto:btau at politico.com>> wrote:
>
> Anyone think it has any broader implications beyond
> perhaps leading to a review about the permissibility of
> hybrid PACs, though?
>
> Aren't some trade associations set up in similar ways?
> 501c + federal PAC + IE arm?
>
> --
> Byron Tau
> Lobbying and campaign finance reporter || POLITICO
> c: 202-441-1171 <tel:202-441-1171>
> d: 703-341-4610 <tel:703-341-4610>
> Follow: @byrontau <http://twitter.com/byrontau>
> Subscribe to: http://www.politico.com/politicoinfluence/
>
> ------------------------------------------------------------------------
> *From:* law-election-bounces at department-lists.uci.edu
> <mailto:law-election-bounces at department-lists.uci.edu>
> [law-election-bounces at department-lists.uci.edu
> <mailto:law-election-bounces at department-lists.uci.edu>] on
> behalf of Kelner, Robert [rkelner at cov.com
> <mailto:rkelner at cov.com>]
> *Sent:* Wednesday, July 02, 2014 2:56 PM
> *To:* Rick Hasen; law-election at UCI.edu
> *Subject:* Re: [EL] big 2d Circuit campaign finance case;
> more news
>
> Today's Second Circuit decision should not affect stand
> alone Super PACs because it turns on ties between a Super
> PAC and a connected traditional PAC. These so-called
> "hybrid" PACs are not particularly useful and have not to
> date played a major role in the campaign finance system.
>
> That said, it seems to me that the Second Circuit opinion
> equates the existence of a traditional PAC that can make
> direct candidate contributions with "coordination." It is
> not necessarily the case that a traditional PAC
> coordinates with candidates merely because it makes
> contributions to candidates. The Court is on firmer ground
> when it cites evidence of a "fluidity" of funds flowing
> between the Super PAC and its connected traditional PAC.
> But this highlights the narrowness of the holding. Many
> Super PACs are estabished as stand alone entities without
> connected traditional PACs, and the Second Circuit's
> decision provides one more reason not to form a hybrid PAC.
>
> It will be interesting to see whether the Second Circuit
> rehears this case in banc, assuming the prevailing party
> moves for rehearing.
>
> Robert K. Kelner
> COVINGTON & BURLING LLP
> 1201 Pennsylvania Avenue, NW
> Washington, DC 20004
> phone: (202) 662-5503 <tel:%28202%29%20662-5503>
> fax: (202) 778-5503 <tel:%28202%29%20778-5503>
> rkelner at cov.com <mailto:rkelner at cov.com>
>
> This message is from a law firm and may contain
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> *From:*law-election-bounces at department-lists.uci.edu
> <mailto:law-election-bounces at department-lists.uci.edu>
> [mailto:law-election-bounces at department-lists.uci.edu
> <mailto:law-election-bounces at department-lists.uci.edu>]
> *On Behalf Of *Rick Hasen
> *Sent:* Wednesday, July 02, 2014 12:28 PM
> *To:* law-election at UCI.edu
> *Subject:* [EL] big 2d Circuit campaign finance case; more
> news
>
>
> Big Campaign Finance News: Second Circuit Accepts
> Limits on Contributions to Independent Campaign
> Committees in Some Circumstances, Creating Circuit
> Split <http://electionlawblog.org/?p=62960>
>
> Posted on July 2, 2014 9:26 am
> <http://electionlawblog.org/?p=62960>by Rick Hasen
> <http://electionlawblog.org/?author=3>
>
> Today a unanimous Second Circuit panel issued an 84-page
> opinion in Vermont Right to Life, Inc. v. Sorrell
> <http://electionlawblog.org/wp-content/uploads/12-2904_opn.pdf>.
> Most of the opinion is devoted tor rejecting a number of
> arguments raised against Vermont disclosure rules applied
> to independent groups. This is quite consistent with the
> rulings of other courts since /Citizens United: /most
> disclosure challenges have failed.
>
> But the most interesting part of the decision comes in the
> last 22 pages or so. As I understand it, Vermont Right to
> Life had two committees, one which made only independent
> expenditures (what we would now generally call a Super
> PAC) and another which made contributions to candidates.
> The Second Circuit agreed that if there were just the
> Super PAC, it would be unconstitutional to limit
> contributions to the group (following the Citizens
> United-SpeechNow line of cases). But VRTL did not dispute
> that the two different groups were "enmeshed" with one
> another, and the Second Circuit held that the overlap
> between the two groups provided a basis for limiting
> contributions to /both/ of them. A separate bank account
> is not enough according to the Second Circuit, although it
> seems to be enough in other circuits (see, e.g., the Carey
> v. FEC case from the D.C. Circuit). This sets up a Circuit
> split and the potential for either en banc review in the
> Second Circuit or Supreme Court review.
>
> Here is the relevant language about enmeshment beginning
> on page 68:
>
> Although some courts have held that the creation of
> separate bank accounts is by itself sufficient to
> treat the entity as an independent-expenditure-only
> group, see, e.g.,Emily's List v. Fed. Election Comm'n,
> 581 F.3d 1, 12 (D.C. Cir. 2009),21 we do not believe
> that is 1 enough to ensure there is a lack of
> ""prearrangement and coordination." A separate bank
> account may be relevant, but it does not prevent
> coordinated expenditures -- whereby funds are spent in
> coordination with the candidate. See Stop This
> Insanity, Inc. Emp. Leadership Fund v. Fed. Election
> Comm'n, 902 F. Supp. 2d 23, 43 (D.D.C. 2012). Nor is
> it enough to merely state in organizational documents
> that a group is an independent-expenditure-only group.
> Some actual organizational separation between the
> groups must exist to assure that the expenditures are
> in fact uncoordinated. We therefore decline to adopt
> the reasoning of the Fourth Circuit in NCRL III.
> There, the Fourth Circuit rejected North Carolina's
> argument that NCRL-FIPE (a similar organization to
> VRLC-FIPE) was "not actually an independent
> expenditure committee because it [was] 'closely
> intertwined'" with NCRL and NCRL-PAC, two
> organizations (similar to VRLC and VRLC-PC) that did
> not limit their activities to independent
> expenditures. NCRL III, 525 F.3d at 294 n.8. The
> Fourth Circuit concluded based only on NCRL-FIPE's
> organizational documents that the group was
> "independent as a matter of law."22 Id. We do not
> agree that organizational documents alone satisfy the
> anti-corruption concern with coordinated expenditures
> that may justify contribution limits.
>
> There is little guidance from other courts on
> examining coordination of expenditures, but we
> conclude that, at a minimum, there must be some
> organizational separation to lessen the risks of
> coordinated expenditures. Separate bank accounts and
> organizational documents do not ensure that
> "information [] will only be used for independent
> expenditures." Catholic Leadership Coal. of Tex. v.
> Reisman, No. A-12-CA-566-SS, 2013 WL 2404066, at *177
> (W.D. Tex. May 30, 2013) (emphasis added) ("The
> informational wall [that plaintiff] asserts it can
> raise to keep its independent expenditure activities
> entirely separate from its direct campaign
> contribution activities is thin at best. This triggers
> the precise dangers of corruption, and the appearance
> of corruption, which motivated the Court in Buckley to
> uphold the challenged contribution limits."). As
> discussed below, whether a group is functionally
> distinct from a non-independent-expenditure-only
> entity may depend on factors such as the overlap of
> staff and resources, the lack of financial
> independence, the coordination of activities, and the
> flow of information between the entities.
>
> Share
> <http://www.addtoany.com/share_save#url=http%3A%2F%2Felectionlawblog.org%2F%3Fp%3D62960&title=Big%20Campaign%20Finance%20News%3A%20Second%20Circuit%20Accepts%20Limits%20on%20Contributions%20to%20Independent%20Campaign%20Committees%20in%20Some%20Circumstances%2C%20Creating%20Circuit%20Split&>
>
> Posted incampaign finance
> <http://electionlawblog.org/?cat=10>
>
>
> "Why the Civil Rights Act Couldn't Pass Today"
> <http://electionlawblog.org/?p=62957>
>
> Posted on July 2, 2014 8:38 am
> <http://electionlawblog.org/?p=62957>by Rick Hasen
> <http://electionlawblog.org/?author=3>
>
> Todd Purdum, author of the new book, An Idea Whose Time
> Has Come: Two Presidents, Two Parties and the Battle for
> the Civil Rights Act of 1964
> <http://us.macmillan.com/anideawhosetimehascome/ToddPurdum>,
> has writtenthis article in
> <http://dyn.politico.com/printstory.cfm?uuid=4C8AD4D6-4E72-4C84-B19E-67B19252CE4C>
> Politico, which also discusses the Voting Rights Act renewal.
>
> Share
> <http://www.addtoany.com/share_save#url=http%3A%2F%2Felectionlawblog.org%2F%3Fp%3D62957&title=%E2%80%9CWhy%20the%20Civil%20Rights%20Act%20Couldn%E2%80%99t%20Pass%20Today%E2%80%9D&description=>
>
> Posted inVoting Rights Act
> <http://electionlawblog.org/?cat=15>
>
>
> "The Defiant Mississippi Loser"
> <http://electionlawblog.org/?p=62955>
>
> Posted on July 2, 2014 8:34 am
> <http://electionlawblog.org/?p=62955>by Rick Hasen
> <http://electionlawblog.org/?author=3>
>
> /The Hill/ reports
> <http://thehill.com/blogs/ballot-box/senate-races/211127-the-defiant-mississippi-loser>on
> McDaniel's efforts to challenge the #MSSEN results.
>
> Share
> <http://www.addtoany.com/share_save#url=http%3A%2F%2Felectionlawblog.org%2F%3Fp%3D62955&title=%E2%80%9CThe%20Defiant%20Mississippi%20Loser%E2%80%9D&description=>
>
> Posted incampaigns <http://electionlawblog.org/?cat=59>,
> recounts <http://electionlawblog.org/?cat=50>
>
>
> "Marijuana, Voters Bill of Rights to miss Nov. ballot"
> <http://electionlawblog.org/?p=62953>
>
> Posted on July 2, 2014 8:33 am
> <http://electionlawblog.org/?p=62953>by Rick Hasen
> <http://electionlawblog.org/?author=3>
>
> The latest
> <http://www.cincinnati.com/story/news/politics/elections/2014/07/01/marijuana-voters-bill-of-rights-to-miss-november-ballot/11901311/>
> from Ohio.
>
> Share
> <http://www.addtoany.com/share_save#url=http%3A%2F%2Felectionlawblog.org%2F%3Fp%3D62953&title=%E2%80%9CMarijuana%2C%20Voters%20Bill%20of%20Rights%20to%20miss%20Nov.%20ballot%E2%80%9D&description=>
>
> Posted inThe Voting Wars <http://electionlawblog.org/?cat=60>
>
>
> --
>
> 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 <tel:949.824.3072> - office
>
> 949.824.0495 <tel:949.824.0495> - fax
>
> rhasen at law.uci.edu <mailto:rhasen at law.uci.edu>
>
> http://www.law.uci.edu/faculty/full-time/hasen/
>
> 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://www.law.uci.edu/faculty/full-time/hasen/
http://electionlawblog.org
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