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Thomasenia P. Duncan 

David Kolker 

Harry J. Summers (CA Bar #147929) 

Claire N. Rajan (CA Bar #238785) 

crajan@fec.gov 

FEDERAL ELECTION COMMISSION JS 6 

999 E Street, N.W. 

Washington, D.C. 20463 

(202) 694-1650 

(202) 219-0260 (facsimile) 

ATTORNEYS FOR THE PLAINTIFF

FEDERAL ELECTION COMMISSION 

UNITED STATES DISTRICT COURT 

 FOR THE CENTRAL DISTRICT OF CALIFORNIA 

WESTERN DIVISION 

FEDERAL ELECTION COMMISSION, )

Plaintiff, )

 )

 v. )

 )

STEPHEN ADAMS, )

Defendant. ) 

Civ. No. 07-4419 DSF (SHx) 

CONSENT ORDER AND 

JUDGMENT 

CONSENT ORDER AND JUDGMENT 

This action for declaratory, injunctive, and other appropriate relief was 

instituted by the plaintiff Federal Election Commission (“Commission”) against 

defendant Stephen Adams, pursuant to the express authority granted the 

Commission by the Federal Election Campaign Act of 1971, as amended 

(“Act”), in 2 U.S.C. §§ 437d(a)(6) and 437g(a)(6)(A). 

This Court has jurisdiction over this suit pursuant to 28 U.S.C. § 1345 as 

an action brought by the Commission, an agency of the United States expressly 

authorized to sue by an act of Congress. 2 U.S.C. §§ 437d(a)(6) and 

437g(a)(6)(A). Venue is properly found in the Central District of California 

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pursuant to 28 U.S.C. § 1391(b) and 2 U.S.C. § 437g(a)(6)(A). 

The Commission has satisfied all jurisdictional prerequisites to the 

initiation of this suit. 

The parties have waived any and all claims for costs, attorney’s fees or 

other expenses relating to or arising in any manner from this litigation, 

including any that Stephen Adams may have under the Equal Access to Justice 

Act, 5 U.S.C. § 504. The parties have also waived all rights of appeal from this 

Order and Judgment. 

The parties have stipulated to the Court’s entry of this Consent Order and 

Judgment based on the following facts: 

1. Under the Act, “[a] person . . . that makes or contracts to make 

independent expenditures aggregating $10,000 or more at any time up to and 

including the 20th day before the date of an election shall file a report describing 

the expenditures within 48 hours.” 2 U.S.C. § 434(g)(2)(A); see also 11 C.F.R. 

§ 109.10(c). 

 2. An independent expenditure is “an expenditure made by a person – 

(A) expressly advocating the election or defeat of a clearly identified candidate; 

and (B) that is not made in concert or cooperation with or at the request or 

suggestion of such candidate, the candidate’s authorized political committee, or 

their agents, or a political party committee or its agents.” 2 U.S.C. § 431(17); 

see also 11 C.F.R. § 100.16(a). 

3. A report disclosing independent expenditures must be received by the 

Commission by “11:59 p.m. Eastern Standard/Daylight Time on the second day 

following the date on which a communication is publicly distributed or 

otherwise publicly disseminated.” 11 C.F.R. § 109.10(c). 

4. The Act requires disclaimers on communications paid for by 

independent expenditures that must “clearly state the name and permanent 

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street address, telephone number or World Wide Web address of the person 

who paid for the communication” and that the communication was not 

authorized by any candidate or committee. 2 U.S.C. § 441d(a)(3); see also 11 

C.F.R. §§ 109.11, 110.11. 

5. Stephen Adams is a “person” within the meaning of 2 U.S.C. 

§ 431(11). 

 6. On or about June 1, 2004, Adams hired his company, Adams Outdoor 

Advertising, Inc. (“AOA”), to design and implement a one million dollar, multistate outdoor advertising campaign in support of President George W. Bush’s 

re-election. On or about August 2004, AOA sent proposed contracts for 435 

separate billboards in Michigan, Pennsylvania, Wisconsin, and South Carolina 

to Adams, who signed and returned the contracts to AOA in or around August 

2004. These four states were chosen by AOA based on Adams’ direction to 

place the billboards in battleground states for the 2004 presidential election. 

7. On September 7, 2004, Adams wired Adams Outdoor Advertising $1 

million as payment for the advertising campaign. 

8. The billboards first appeared on September 7, 2004 and ran through 

November 2, 2004, the date of the 2004 general election. 

9. The billboards consisted of different phrases such as “Defending Our 

Nation,” “It’s About Our National Security,” “A Nation Secure,” “One Nation 

Under God,” and “Boots or Flip-Flops?” These phrases appeared immediately 

above the campaign slogan “Bush Cheney 04” superimposed on the red and 

white stripes of the American flag. 

10. The “Bush Cheney 04” slogan that appeared on the billboards is 

substantially similar to the Bush-Cheney ’04 campaign’s official logo. 

11. Adams was required to file a report of his $1 million independent 

expenditure with the Commission within 48 hours from when he made or 

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contracted to make the independent expenditure exceeding $10,000. 2 U.S.C. 

§ 434(g)(2)(A); see also 11 C.F.R. § 109.10(c). Therefore, the report was due 

no later than September 9, 2004, 48 hours after Adams paid for the billboards. 

12. Adams did not file a report of his expenditure with the Commission 

until October 28, 2004, only five days prior to the general election. In this 

report, Adams certified for the first time that the billboards he sponsored were 

not authorized by any candidate or political party. 

 13. The billboards originally carried disclaimers that read, “Personal 

message paid for and sponsored by Stephen Adams.” 

14. These disclaimers did not contain Adams’ permanent street address, 

telephone number or World Wide Web address, and failed to state that the 

billboards were not authorized by any candidate or candidate’s committee. 

15. These insufficient disclaimers were on the billboards from the point 

at which they appeared, on September 7, 2004, through at least October 19, 

2004. 

16. Stephen Adams contends that: 

(a) Prior to making the independent expenditure, an employee 

of AOA received general guidance regarding the requirements of federal 

campaign finance law applicable to an individual making an independent 

expenditure. Counsel provided incorrect advice as to the content of the 

disclaimer required by 2 U.S.C. § 441d(a)(3) and failed to advise that 

Adams, as an individual, was required by 2 U.S.C. § 434(g)(2)(A) to 

report the independent expenditure to the Commission within forty-eight 

(48) hours; 

(b) On or about October 15, 2004, Adams was informed by 

newly-retained counsel that the disclaimers did not fully comply with the 

requirements of 2 U.S.C. § 441d(a)(3). Adams immediately took steps to 

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produce and install corrected disclaimers on the Advertisements. The 

following corrected disclaimer was installed on the advertisements prior 

to the general election on November 2, 2004: “Paid for by Stephen 

Adams and not authorized by any candidate or candidate's committee. 

Contact: sadams@adamsoffice.net.” The total cost to Adams of 

installing corrected disclaimers on the advertisements was fourteen 

thousand, five-hundred and forty-five dollars and twenty-seven cents 

($14,545.27); 

(c) The initial legal counsel never advised Adams that he was 

required to file a report of his independent expenditure with the 

Commission. Upon being advised of the requirements of 2 U.S.C. 

434(g)(2)(A) by newly-retained counsel, Adams filed a report of this 

expenditure with the Commission on October 28, 2004. 

The Commission acknowledges and has taken into consideration the 

remedial steps that Adams took to come into compliance with 2 U.S.C. 

§ 441d(a)(3) before the general election on November 2, 2004. 

The Commission and Stephen Adams having stipulated to the issuance 

and entry of this Consent Order and Judgment, it is HEREBY ORDERED, 

ADJUDGED AND DECREED that: 

A. Stephen Adams failed to file timely a report of an independent 

expenditure of $1 million, in violation of 2 U.S.C. § 434(g)(2)(A). 

B. Stephen Adams failed to post sufficient disclaimers on the 

billboards he purchased as an independent expenditure, in violation of 

2 U.S.C. § 441d(a)(3). 

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 C. Within five business days of the date of entry of this consent order 

and judgment, Stephen Adams shall pay a civil penalty of One Hundred and 

Fifteen Thousand dollars ($115,000) to the Federal Election Commission 

pursuant to 2 U.S.C. § 437g(a)(6)(B). See 2 U.S.C. § 437g(a)(6)(B); 

D. Stephen Adams is permanently enjoined from violating 2 U.S.C. 

§§ 434(g)(2)(A) or 441d(a)(3); 

E. All parties shall bear their own costs and attorney’s fees in this 

litigation; and 

F. This Court shall retain jurisdiction of this action, and of any 

ancillary or supplemental actions thereto, in order to, among other things, 

implement and carry out the terms of all orders, judgments, and decrees that 

may be entered herein, including any that may be necessary to assure 

compliance with this Order and Judgment. 

The Clerk of the Court is directed to enter this Judgment. 

 ORDERED in Los Angeles, California on 9/17/08 2008. 

 

DALE S. FISCHER 

UNITED STATES DISTRICT JUDGE 

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