FEDERAL ELECTION COMMISSION

WASHINGTON, D.C. 20463

STATEMENT OF REASONS OF 

CHAIR SHANA M. BROUSSARD AND COMMISSIONER ELLEN L. WEINTRAUB

The Complaint in this matter alleged that Howard Schultz violated the Federal Election 

Campaign Act of 1971, as amended, by failing to register and report as a candidate for U.S. 

President. Consistent with the Office of General Counsel’s recommendations, the Commission 

unanimously voted to dismiss the allegations.1 

Despite agreeing that dismissal was appropriate, we did not have the necessary four votes to 

approve a Factual and Legal Analysis explaining the Commission’s rationale for its decision. We 

supported the Office of General Counsel’s Factual and Legal Analysis subject to minor edits. We 

attach here the proposed Factual and Legal Analysis that we supported, which provides the 

explanation for our votes.2

December 15, 2021 ____________________________ 

Date Shana M. Broussard 

Chair

December 15, 2021 ____________________________ 

Date Ellen L. Weintraub 

Commissioner

1 See Certification in MUR 7567 (Howard Schultz), dated November 15, 2021 (“Certification”). 2 See Attachment A (Proposed Factual and Legal Analysis). As noted, this version was not adopted by the Commission. 

See Certification. 

BEFORE THE FEDERAL ELECTION COMMISSION

In the Matter of

Howard Schultz 

)

 ) 

 ) 

 ) 

MUR 7567 

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ATTACHMENT A

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1 FEDERAL ELECTION COMMISSION

2 PROPOSED FACTUAL AND LEGAL ANALYSIS

3 RESPONDENT: Howard Schultz MUR: 7567 

4 

5 I. INTRODUCTION

6 This matter was generated by a Complaint filed with the Federal Election Commission 

7 (the “Commission”). The Complaint alleges that Howard Schultz, former CEO of Starbucks, 

8 violated the Federal Election Campaign Act of 1971, as amended (the “Act”), by failing to 

9 register and report as a candidate for U.S. President, contending that Shultz went beyond testing 

10 the waters by hiring political consultants, conducting polling, and laying the groundwork for paid 

11 advertising. From late January 2019 through mid-April, Schultz maintained a high public profile 

12 through interviews, town halls, and social media posts; however, from mid-April through 

13 September 6, 2019, the date when Schultz officially declared his intention not to run, Schultz 

14 receded from public life amid health concerns and a crowded Democratic primary field. 

15 The Commission dismisses the allegation that Schultz violated 52 U.S.C. §§ 30102(e)(1), 

16 30103, and 30104 by failing to register and report as a candidate because the available record 

17 indicates that Schultz’s expenses do not appear to have gone beyond testing the waters. 

18 II. FACTUAL BACKGROUND

19 On January 27, 2019, Schultz, the former CEO of Starbucks Corporation, announced on 

20 CBS’s 60 Minutes that he was “seriously thinking of running for president” as a “centrist 

independent.”1 21 Schultz indicated that he would promote his memoir while deciding whether to 

1

 Compl. at 1 (Feb. 14, 2019); 60 Minutes Interview at 0:12-17, CBS (Jan. 27, 2019), 

https://www.youtube.com/watch?v=gnBhtwKRFhA. 

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run for President and was willing to spend his personal fortune on his potential campaign.2 1 The 

2 Complaint alleges that Schultz became a federal candidate because a news article at the time 

3 reported that he had hired political consultants, conducted polling, and laid the “groundwork for 

paid advertising that could debut in the next two months.”3 4 

5 In late January, Schultz’s website principally contained marketing for his book, From the 

Ground Up, including an active book tour schedule traveling around the country.4 6 In the 

7 following months, in addition to promoting his book, Schultz also discussed a potential 

8 campaign in televised town halls, speeches, news programs, and social media. For example, on 

9 February 12, 2019, Schultz discussed his positions on political issues at a televised town hall on 

CNN, stating that he was exploring a run, but had not yet made a decision whether to run.5 10 

11 Beginning in March through late April, Schultz began tweeting about political issues and 

criticizing candidates from both parties.6 12 For example, Schultz criticized President Trump by 

13 tweeting that he “has polluted the presidency with his indecency for 788 days. His continuing 

14 assault on the legacy of [John McCain] is a total disgrace and an embarrassment beneath the 

dignity of the office.”7 15 Schultz also criticized Democratic primary candidate Bernie Sanders by 

2

 Lisa Lerer, Is Howard Schultz a Candidate Without a Constituency?, N.Y. TIMES, Jan. 28, 2019, 

https://www.nytimes.com/2019/01/28/us/politics/on-politics-howard-schultz-starbucks-independent.html; Compl. at 

2. 

3 Compl. at 2 (citing Michael Scherer, Howard Schultz’s presidential ambitions spurred a months-long effort 

to disrupt the 2020 race, WASH. POST, Jan. 29, 2019, https://www.washingtonpost.com/politics/howard-schultzspresidential-ambitions-spurred-a-months-long-effort-to-disrupt-the-2020-race/2019/01/29/30a22154-2408-11e9-

ad53-824486280311_story.html). 

4

 Howard Shultz, (Jan. 31, 2019), 

https://web.archive.org/web/20190131032136/https://www.howardschultz.com/. 

5

 Town Hall with Howard Schultz, CNN (Feb. 13, 2019), 

https://www.youtube.com/watch?v=A45CoomULVc.

6

 https://twitter.com/HowardSchultz. 

7

 Howard Schultz Tweet, Mar. 20, 2019, https://twitter.com/HowardSchultz/status/1108472548516192256. 

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1 stating: “The Medicare for All proposal by [Bernie Sanders] would cause 180 million people to 

2 lose their current healthcare coverage. All that Sanders and the far-left care about is furthering 

3 their agenda. This is unrealistic and shows a total disregard of our country’s overwhelming 

debt.”8 4 

5 On March 30, Schultz began running ads on Facebook criticizing the two-party system, 

requesting that people sign a #fixthesystem “petition.”9 6 The petition requested that people “sign 

7 the petition” online by providing an email address if they “believe the two-party system is 

broken and not working for you.”10 8 Around the same time, Schultz’s website was revised to 

9 contain more biographical information and include a video entitled “restoring our nation,” which 

is no longer available.11 10 The revised website also included the same #fixthesystem language and 

petition linked in Schultz’s Facebook ads.12 11 

On April 4, 2019, Schultz attended a Fox News town hall in Kansas City, Missouri.13 12 

13 The moderators stated that Schultz had not yet declared his candidacy, but when asked whether 

14 he would vote for Biden, Schultz stated, “Well, I’m going to vote for myself.” In a follow-up 

15 question, moderators asked, “Does that mean you’re running? Is that a declaration?” Schultz 

8

 Howard Schultz Tweet, Apr. 10, 2019, https://twitter.com/HowardSchultz/status/1116101439376351232. 

9 Facebook Ad Library, Howard Schultz,

https://www.facebook.com/ads/library/?active_status=all&ad_type=all&country=US&view_all_page_id=1

782368278496620 (last visited Oct. 22, 2019); Howard Schultz Tweet, Mar. 30, 2019, 

https://twitter.com/HowardSchultz/status/1112008873236258817. 

10 https://fixthesystem.howardschultz.com/ (last visited Dec. 3, 2019). 

11 Howard Schultz, (Apr. 21, 2019), 

https://web.archive.org/web/20190421200403/https://www.howardschultz.com/. 

12 Id.

13 Town Hall with Howard Schultz: Part 1, FOX NEWS, (Apr. 4, 2019), 

https://video.foxnews.com/v/6022650200001/#sp=show-clips. 

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stated, “We have 18 months to decide that.”14 1 Later, during the same event, Schultz explained 

2 that if a moderate Democrat ran, then he would not run; however, if a “Democratic Socialist” 

3 like Bernie Sanders was emerging as the likely nominee, then he would be much more likely to 

run.15 4 

5 News reports indicate that Schultz “cooled” on a possible run after Biden officially 

6 declared his candidacy on April 19, 2019, because Schultz reportedly believed that Biden would 

run as a moderate.16 7 After Biden’s entry into the presidential race, Schultz posted only a handful 

of tweets, compared to tweeting nearly daily in the previous months.17 8 Schultz’s most recent 

tweet as of the time of this report was posted on June 6, 2019.18 9 On June 12, 2019, Schultz sent 

10 a letter to his supporters stating that he was recovering from back surgery and that he would be 

discontinuing his exploration of a presidential bid until “after Labor Day.”19 11 Schultz officially 

declared that he would not run for president on September 6, 2019.20 12 

13 In an unsworn response, Schultz asserts that he was testing the waters because he 

14 publicly stated on several occasions that he was only evaluating a run and never actually decided 

14 Id. at 4:17-4:35.

15 Id. at 6:45-7:30. 

16 David Choi, Former Starbucks CEO Howard Schultz is cooling it on his potential 2020 presidential run

because of Joe Biden, BUSINESS INSIDER, May 15, 2019, https://www.businessinsider.com/howard-schultz-2020-

campaign-and-joe-biden-2019-5. 

17 https://twitter.com/HowardSchultz. 

18 Howard Schultz Tweet, June 6, 2019, https://twitter.com/HowardSchultz/status/1136651347107885057. 

19 Kate Sullivan, Howard Schultz cuts staff and takes the summer off from exploring presidential bid after 

back surgeries, CNN, June 12, 2019, https://www.cnn.com/2019/06/12/politics/howard-schultz-summer-offrecover-surgeries/index.html. 

20 Greg Jaffe and Michael Scherer, Former Starbucks chief executive Howard Schultz announces he will not 

run for president, WASH. POST, Sept. 6, 2019, https://www.washingtonpost.com/politics/former-starbucks-chiefexecutive-howard-schultz-announces-he-will-not-run-for-president/2019/09/05/230b0fa2-d046-11e9-87fa8501a456c003_story.html. 

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to run.21 1 Schultz further asserts that, despite the allegation that he had laid the groundwork for 

2 political advertising, he never actually disseminated any ads “to publicize his intention to 

campaign for Federal office” as set forth in Commission regulations.22 3 Moreover, Schultz 

4 argues that expenses for polling and the hiring of consultants to evaluate a potential bid are 

traditional testing-the-waters expenses.23 5 

6 III. LEGAL ANALYSIS

7 An individual becomes a candidate under the Act when: (a) such individual receives 

8 contributions or makes expenditures in excess of $5,000; or (b) such individual gives his or her 

9 consent to another person to receive contributions or make expenditures on behalf of such 

10 individual and if such person has received such contributions or has made such expenditures in 

excess of $5,000.24 11 Once the $5,000 threshold has been met, the candidate has 15 days to 

12 designate a principal campaign committee by filing a Statement of Candidacy with the 

Commission.25 13 The principal campaign committee must file a Statement of Organization within 

ten days of its designation,26 and it must file disclosure reports with the Commission.27 14 

15 The Commission has established “testing-the-waters” regulations excepting from the 

16 definitions of “contribution” and “expenditure” funds received and payments made solely to 

21 Resp. at 2 (Apr. 12, 2019).

22 Id. at 3

23 Id. at 4.

24 52 U.S.C. § 30101(2). 

25 52 U.S.C. § 30102(e)(1); 11 C.F.R. § 101.1(a). 

26 See 52 U.S.C. § 30103(a); 11 C.F.R. § 102.1(a).

27 52 U.S.C. § 30104(a), (b). See, e.g., Factual and Legal Analysis at 6, MUR 6735 (Joseph A. Sestak); 

Factual and Legal Analysis at 5, MUR 6449 (Jon Bruning); Factual and Legal Analysis at 2, MUR 5363 (Alfred C. 

Sharpton).

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1 determine whether an individual should become a candidate, thereby permitting an individual to 

test the feasibility of a campaign for federal office without becoming a candidate under the Act.28 2 

3 These testing-the-waters regulations seek to draw a distinction between activities directed to 

4 evaluating the feasibility of one’s candidacy and conduct signifying that a decision to become a 

candidate has been made.29 5 Testing-the-waters activities include, but are not limited to, 

6 payments for polling, telephone calls, and travel, and only funds subject to the Act’s source and 

amount prohibitions may be used for such activities.30 7 

8 An individual who is testing the waters is not required to register or file disclosure reports 

9 with the Commission unless and until the individual subsequently decides to run for federal 

office.31 10 However, an individual who tests the waters must keep financial records, and if he or 

11 she becomes a candidate, all funds received, or payments made in connection with testing the 

12 waters must be reported as contributions and expenditures in the first report filed by the 

candidate’s principal campaign committee.32 13 

14 The testing-the-waters exceptions are not available to an individual who has decided to 

become a candidate.

33 15 Commission regulations set forth a non-exhaustive list of activities that 

16 indicate when an individual is no longer testing the waters and has decided to become a 

28 See 11 C.F.R. §§ 100.72 and 100.131; Factual and Legal Analysis at 7, MUR 6775 (Hillary Clinton); 

Factual and Legal Analysis at 8, MUR 6776 (Niger Innis); Factual and Legal Analysis at 6, MUR 6735 (Joseph A. 

Sestak). 

29 See Advisory Op. 1981-32 (Askew) (“AO 1981-32”). 

30 Id. 

31 Id; see also Advisory Op. 2015-09 (Senate Maj. PAC, et al.) (“AO 2015-09”). 

32 11 C.F.R. § 101.3.

33 See AO 2015-09 at 5. See also Payments Received for Testing the Waters Activities, 50 Fed Reg. 9,992, 

9,993 (Mar. 13, 1985) (exemption “explicitly limited ‘solely’ to activities designed to evaluate a potential 

candidacy”).

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1 candidate. Such indicia include: (1) using general public political advertising to publicize his or 

2 her intention to campaign for federal office; (2) raising funds in excess of what could reasonably 

3 be expected to be used for exploratory activities or undertaking activity designed to amass 

4 campaign funds that would be spent after he or she becomes a candidate; (3) making or 

5 authorizing written or oral statements that refer to him or her as a candidate for a particular 

6 office; (4) conducting activities in close proximity to the election or over a protracted period of 

time;34 and (5) taking action to qualify for the ballot under state law.35 7 

8 Once an individual has decided to be a candidate, he or she must designate a principal 

9 campaign committee within 15 days, which must file a Statement of Organization within ten 

days of being designated by the candidate.36 10 The committee must establish a separate segregated 

11 fund, maintain a record of all contributions received and expenditures made while testing the 

12 waters, and disclose all receipts and disbursements in the committee’s first financial report filed 

with the Commission.37 13 All funds raised and spent for testing-the-waters activities are subject to 

the Act’s limitations and prohibitions.38 14 

15 In determining whether an individual has moved from testing the waters to candidate 

16 status, the Commission considers whether the individual has engaged in activities or made 

34 The Commission has advised that there is no specific time limit for such activities, and the length of time 

spent testing the waters is but one factor in determining whether an individual becomes a candidate. AO 2015-09 

at 6. 

35 11 C.F.R. §§ 100.72(b), 100.131(b). 

36 See 52 U.S.C. §§ 30102(e)(1), 30103(a), 30104(a).

37 52 U.S.C. §§ 30102(b), 30104(a); 11 C.F.R. § 101.3.

38 11 C.F.R. §§ 100.72(a); 100.131(a). 

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statements that would indicate the individual has decided to run for federal office.39 1 “[T]he 

2 determination of whether an individual has crossed the line from ‘testing the waters’ to 

campaigning must be made on a case-by-case basis.”40 3 

4 Here, the available information does not indicate that Schultz decided to become a federal 

5 candidate before formally declaring his intention not to run. The Complaint bases its allegation 

6 that Schultz became a candidate primarily on the first factor — that Schultz was “laying the 

7 groundwork for paid advertising,” arguing that even in the absence of any public statement that 

8 Schultz had become a candidate, expenditures for political advertising would be sufficient to 

trigger candidacy.41 9 In his Response, Schultz argues that he did not run any ads specifically for 

10 the purpose of publicizing “his intention to campaign for Federal office” as set forth in 

Commission regulations.42 11 Although the Complaint did not identify any specific ads, a review of 

12 the Facebook Ad Library reveals that Schultz spent $143,212 on ads between May 29, 2018 and 

October 15, 2019, the majority of which ran between March and April of 2019.43 13 For example, 

14 one 30-second ad that started running on April 23, 2019 contained no audio and the following 

15 text on screen: 

16 This is America, right now [half the screen red and half blue]. 

17 Stuck. In a broken two-party system. But America isn’t broken. 

18 Our politics are. United, we can change that. We are the new 

19 majority. And together, we have the power to renew the promise 

39 Factual & Legal Analysis at 6-7, MUR 6449 (Jon Bruning); First Gen. Counsel Rpt. at 10, MUR 6533 

(Perry Haney for Congress).

40 50 Fed. Reg. at 9,993.

41 Compl. at 4.

42 Resp. at 3.

43 Facebook Ad Library, Howard Scultz, 

https://www.facebook.com/ads/library/?active_status=all&ad_type=all&country=US&view_all_page_id=17823682

78496620 (last visited Dec. 3, 2019). Although the ad library counts 950 ads, there are many duplicates.

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1 of America. Let’s fix the broken two-party system. Sign our 

petition #fixthesystem.44 2 

3 

4 Other ads Schultz ran contained a similar message. For example, one ad that ran between 

5 April 9, 2019 and May 10, 2019, stated “if you’re not red or blue — who in Washington 

represents you? Sign our petition. #fixthesystem.”45 6 While the ads criticize the two-party 

7 system, which apparently could have been a central campaign theme of a potential Schultz 

8 campaign, we have been unable to identify an ad that publicizes Schultz’s “intention to campaign 

9 for federal office” and the Complaint does not specifically identify any such ad. 

10 Second, we do not have any information regarding Schultz’s fundraising or spending. 

11 There is no allegation in the Complaint that Schultz raised or spent a significant amount of 

12 money. News reports indicate that Schultz committed to spending $300 to $500 million of his 

personal funds if he ran, suggesting that Schultz was not actively fundraising.46 13 

14 Third, although Schultz stated that he would “vote for myself” at a town hall, in follow15 up questions, Schultz clarified during in the same event that he had not yet made a decision to 

16 run, explaining that the presence of a moderate Democratic candidate such as Biden would make 

him less likely to enter the race.47 17 Schultz also stated earlier in the town hall that he had not 

18 decided to run. In this context, Schultz’s statement that he intended to vote for himself, though 

44 Howard Schultz, Fix the System, FACEBOOK AD LIBRARY (started running Apr. 23, 2019) 

https://www.facebook.com/ads/library/?id=444591043012980. The same ad ran at various other times. 

45 Howard Schultz, FACEBOOK AD LIBRARY (Apr. 9, 2019 – May 10, 2019) 

https://www.facebook.com/ads/library/?id=326934198018728. 

46 Compl. at 2 (citing Michael Scherer, Howard Schultz’s presidential ambitions spurred a months-long effort 

to disrupt the 2020 race, WASH. POST, Jan. 29, 2019, https://www.washingtonpost.com/politics/howard-schultzspresidential-ambitions-spurred-a-months-long-effort-to-disrupt-the-2020-race/2019/01/29/30a22154-2408-11e9-

ad53-824486280311_story.html.

47 Town Hall with Howard Schultz: Part 1 at 4:13-17, 6:45-7:30, FOX NEWS, (Apr. 4, 2019), 

https://video.foxnews.com/v/6022650200001/#sp=show-clips. 

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1 suggestive of a decision to run, is not sufficient in light of his other, contemporaneous statements 

regarding his potential candidacy to indicate that he had decided to run.48 2 

3 Fourth, Schultz’s activity predated the first primaries by more than a year and lasted only 

4 several months and thus was not in close proximity to the election or over a protracted period of 

time.49 5 

6 Fifth, Schultz stated at a town hall that, if he ran, he intended to be on the ballot in all 50 

states.50 7 The New York Times reported that “Mr. Shultz said he had already begun the 

groundwork required to be on the ballot in all 50 states.”51 8 However, the article provides no 

9 details regarding what specific steps, if any, that Schultz undertook to qualify for any state’s 

10 ballot. Nor is there other information in the available record that Schultz took any concrete 

11 action to appear on any state ballots such as, for example, collecting signatures or filing 

12 paperwork. 

13 While not directly relevant to any one factor, the Complaint also alleges that Schultz 

conducted polling and hired political consultants.52 14 The Complaint, however, does not explain 

15 how these activities establish candidacy, in contrast to reflecting permissible testing-the-waters 

48 See AO 2015-09 at 6 n.3 (“A demonstrably inadvertent misstatement, however, does not necessarily 

indicate that the individual has decided to become a candidate.”).

49 Factual and Legal Analysis at 6, MUR 6948 (Nancy Rotering for Congress) (finding no reason to believe 

where, inter alia, the activity occurred more than one year before the primary).

50 Town Hall at 1:43-44, CNN, (Feb. 13, 2019), https://www.youtube.com/watch?v=A45CoomULVc. 

51 Andrew Ross Sorkin, Howard Schultz Draws Fire From Trump and Bloomberg Over 2020 Plans, NY

TIMES, Jan. 27, 2019, https://www.nytimes.com/2019/01/27/us/politics/howard-schultz-president2020.html?utm_source=CNN+Media%3A+Reliable+Sources&utm_campaign=8313daacb2-

EMAIL_CAMPAIGN_2018_09_11_04_47_COPY_01&utm_medium=email&utm_term=0_e95cdc16a9-

8313daacb2-97188109. 

52 Compl. at 2.

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activity. Polling, for example, is an explicitly enumerated testing-the-waters activity,53 1 and the 

2 Commission has previously found that expenses for polling and consultants can be valid testingthe-waters expenses if done to explore a run.54 3 Given the available information, it is possible 

4 that Shultz retained the consultants to test the waters for a potential run.

5 In sum, the available information does not establish that Schultz had made the private 

6 decision to run and therefore had become a candidate. Instead, Schultz’s contemporaneous 

7 public statements that he was exploring a potential run, and his ultimate decision not to run, are 

8 consistent with testing-the-waters activities. Therefore, because Schultz’s expenses appear to 

9 have been for testing the waters and due to the lack of countervailing information in the available 

10 record, the Commission dismisses the allegation that Schultz violated 52 U.S.C. §§ 30102(e)(1), 

11 30103, and 30104 by failing to register and report as a candidate. 

53 11 C.F.R. § 100.131(a).

54 See, e.g., Advisory Op. 1982-03 (Cranston) at 4-5 (hiring of political consultants can be for testing the 

waters if the candidate had not yet decided to run).

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