IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLUMBIA

LIBERTARIAN NATIONAL COMMITTEE, INC., ) Case No. ________

1444 Duke Street )

Alexandria, VA 22314 ) COMPLAINT

)

Plaintiff, )

)

v. )

)

FEDERAL ELECTION COMMISSION, )

999 E Street, N.W. )

Washington, DC 20463 )

__________________________________________)

COMPLAINT

Plaintiff Libertarian National Committee, Inc., by and through undersigned counsel,

complains of Defendant as follows:

INTRODUCTION

“You can’t take it with you.”

Accordingly, many people leave instructions for the disbursement of their worldly

possessions and money upon their passing—instructions that our legal system aims to honor. Those

instructions, often called a “last will and testament,” are inherently expressive, conveying the

decedent’s desires to advance particular charitable and ideological goals. Often times, those

instructions direct the funding of political parties.

Consistent with this longstanding American tradition, Joseph Shaber bequeathed

$235,575.20, without restrictions, to the Libertarian National Committee. But the LNC cannot

access this money, at least not for the purposes that would best help it communicate with voters,

elect its candidates, and achieve its political objectives.

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Defendant Federal Election Commission applies the federal annual contribution limits to

political party committees, 52 U.S.C. §§ 30116, 30125 (“the Party Limit”), against decedents’

bequests, infringing upon the speech rights of both donors and donees. And while the Party Limit is

currently $33,400, that limit only applies where a particular contribution might be used for general

communication and party-building. Conversely, the Government would allow the Party to accept as

much as $100,200 per year from Shaber’s bequest provided it was used for each of three

Government-approved purposes: a national convention, attorneys, or a headquarters building. See

52 U.S.C. § 30116(a)(1)(B) and (a)(9). In other words, the Government imposes a content-based

restriction on a national party’s speech: a party can only spend $33,400 of a donor’s money on

general political speech, but nearly ten times that amount on Government-favored purposes.

Applying any contribution limits to Joseph Shaber’s bequest is unconstitutional.

And the content-based restrictions on how the Libertarian Party may use its funds are also

unconstitutional, on their face, and as applied against Shaber’s bequest.

THE PARTIES

1. Plaintiff Libertarian National Committee, Inc. (“LNC”) is the national committee of

the Libertarian Party of the United States. The LNC is a not-for-profit organization incorporated

under the laws of the District of Columbia, which maintains its headquarters in Alexandria,

Virginia. The LNC has 12,235 current dues paying members, in all 50 states and the District of

Columbia. Approximately 399,302 registered voters identify with the Libertarian Party in the 27

states in which voters can register as Libertarians. Throughout the Nation, 141 officeholders

(including holders of non-partisan offices), are affiliated with the Libertarian Party. The LNC’s

purpose is to field national Presidential tickets, to support its state party affiliates in running

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candidates for public office, and to conduct other political activities in furtherance of a libertarian

public policy agenda in the United States.

2. Defendant Federal Election Commission (“FEC”) is the federal government agency

charged with administrating and enforcing the federal campaign finance laws, including the laws

challenged in this action.

JURISDICTION AND VENUE

3. This Court has subject matter jurisdiction over the matter pursuant to 28 U.S.C. §§

1331 and 2201, and 52 U.S.C. § 30110, pursuant to which the matter should be immediately

certified to the United States Court of Appeals for the District of Columbia Circuit for consideration

en banc.

4. Venue lies in this Court pursuant to 28 U.S.C. § 1391(e).

STATEMENT OF FACTS

Legislative and Regulatory Background

5. Title 52 U.S.C. § 30116(a)(1) provides, in pertinent part, that “no person shall make

contributions– (B) to the political committees established and maintained by a national political

party, which are not the authorized political committees of any candidate, in any calendar year

which, in the aggregate, exceed $ 25,000, or, in the case of contributions made to any of the

accounts described in paragraph (9), exceed 300 percent of the amount otherwise applicable under

this subparagraph with respect to such calendar year.”

6. Title 52 U.S.C. § 30116(a)(9) describes three “separate, segregated account[s]”

referenced in 52 U.S.C. § 30116(a), to which individuals may, pursuant to that section, contribute

“300 percent of the amount otherwise applicable” under that section. These accounts are:

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(A) an account “which is used solely to defray expenses incurred with respect to a

presidential nominating convention (including the payment of deposits) or to repay

loans the proceeds of which were used to defray such expenses, or otherwise to

restore funds used to defray such expenses, except that the aggregate amount of

expenditures the national committee of a political party may make from such

account may not exceed $ 20,000,000 with respect to any single convention;”

(B) an account “which is used solely to defray expenses incurred with respect to the

construction, purchase, renovation, operation, and furnishing of one or more

headquarters buildings of the party or to repay loans the proceeds of which were used

to defray such expenses, or otherwise to restore funds used to defray such expenses

(including expenses for obligations incurred during the 2-year period which ends on

the date of the enactment of this paragraph);” and

(C) an account “which is used to defray expenses incurred with respect to the preparation

for and the conduct of election recounts and contests and other legal proceedings.”

7. Pursuant to 52 U.S.C. § 30125, enacted as part of the “Bipartisan Campaign Reform

Act of 2002,” no political committee can “solicit, receive or direct to another person a contribution,

donation, or transfer of funds or any other thing of value, or spend any funds, that are not subject to

the limitations, prohibitions, and reporting requirements” of 52 U.S.C. § 30116(a)(1). The

Libertarian Party is not one of the two parties referenced in the “Bipartisan” Act’s title.

8. The FEC has previously taken the litigating position in this Court, which this Court

has accepted, that the limitation on the amounts that political committees may “solicit” is not

violated if the funds are subject to the Party Limit when they are actually received; e.g., a political

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party may solicit bequests in any amount, provided that it does not, in any year, accept funds from

said bequests in excess of the Party Limit.

9. Pursuant to 52 U.S.C. § 30116(c), the contribution limits set forth in 52 U.S.C. §

30116(a)(1) are indexed for inflation. The current annual limit on contributions to political parties is

$33,400.00.

10. Although the term “person,” as used in 52 U.S.C. § 30116(a)(1), is not specifically

defined to include an individual’s testamentary estate, Defendant FEC has determined that the

definition should be so extended. See, e.g. FEC Advisory Opinions 2015-05, 2004-02, 1999-14.

11. Accordingly, the national committees of political parties may not receive bequests

exceeding the federal contribution limits applicable to living individuals. In the event such bequests

are made, defendant FEC does not permit national party committees to receive such bequests into

escrow funds over which they exercise control, including control over the direction of the funds’

investment strategies or choice as to the amount of any withdrawals made in any particular year.

The Libertarian National Committee

12. The Libertarian Party may be the largest “third” party in the United States, but it is

generally unable to effectively recruit and advocate for its candidates. Founded in 1971, the party

has yet to elect a federal office holder. Unlike its two major competitors, the Libertarian Party’s

national committee is forced to spend the bulk of its resources securing access to the ballot, leaving

comparatively little for actual campaigning—an expensive activity in and of itself. The situation is

self-perpetuating, as a party’s ability to solicit donations depends in part on having adequate

financial resources on hand. Donors, voters, and prospective political candidates who might be

attracted to the party’s ideology are nonetheless dissuaded from supporting the party by its lack of

resources.

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13. Accordingly, the LNC has comparatively less use for funds intended to support

national conventions, a headquarters building, or attorney fees. The LNC’s needs in these areas is

not commensurate with the needs of the two major political parties whose elected officials were

exclusively responsible for enacting the segregated account structure of 52 U.S.C. § 30116(a)(9).

The LNC needs, and would prefer, to spend its funds in order to directly speak to the electorate

about its ideology and political mission, to support its candidates, and to build its institutional

capability, including its ability to regularly qualify for the ballot in various states.

14. But for the Party Limits, the LNC would accept sums in excess of the annual

contribution limit, from living donors as well as from testamentary bequests, and spend those funds

for its general expressive purposes, including expression in aid of its federal election efforts. LNC

would accept and spend such sums in amounts that are otherwise within the limits it could accept

and spend for the segregated account purposes of 52 U.S.C. § 30116(a)(9).

The Shaber Bequest

15. Between 1988 and 2011, Joseph Shaber sporadically made small donations to the

LNC, in amounts as low as $10 and rarely exceeding $50. The most that Mr. Shaber donated to

LNC at any time during this period was $300 in March, 1997. Between June, 2011 and November,

2012, Shaber donated $100 per month to the LNC, an amount he twice supplemented by $100

during this period.

16. Unbeknown to the LNC, it was made a beneficiary of the Joseph Shaber Revocable

Living Trust U/T/D February 11, 2010 (“the trust”).

17. On August 23, 2014, Joseph Shaber passed away, rendering the trust irrevocable.

LNC’s share of the trust’s estate is $235,575.20.

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18. LNC would accept and spend the entire amount of the Shaber bequest for its general

expressive purposes, including expression in aid of its federal election efforts.

19. Owing to Defendant FEC’s application of federal contribution limits, Plaintiff LNC

could not accept this entire bequest at once, as it would use at least some if not all of the money on

federal election efforts and for its other desired expressive purposes. Rather, the LNC accepted a

single payment of $33,400 in 2015, and agreed that the remaining $202,175.20 would be placed in

an escrow.

20. The escrow account is established pursuant to an agreement among Alexina Shaber,

a trustee of the trust, the LNC, and the escrow agent, First International Bank & Trust of Phoenix,

Arizona, attached hereto as Exhibit A. The agreement provides, inter alia, that the escrow agent is to

invest the funds in bank accounts or certificates of deposit, and to annually disburse the funds to

LNC at the maximum amount permitted by the FEC. The agreement explicitly provides, however,

that the LNC may challenge the legal validity of the contribution limit, and demand payment of the

full amount remaining in the account should its challenge succeed. LNC has received its 2016

disbursement.

COUNT I

VIOLATION OF U.S. CONST. AMEND. I – RIGHT OF FREE SPEECH

APPLICATION OF CONTRIBUTION LIMITS AGAINST THE SHABER BEQUEST

21. Paragraphs 1 through 20 are incorporated as though fully re-stated herein.

22. A unilateral, revocable promise to donate money to a political party at some

indeterminate future time upon one’s death does not readily create the appearance or possibility of

quid pro quo corruption justifying restrictions upon the size of bequests to political parties. Such

bequests, by their nature, cannot effectively circumvent contribution limits to political candidates

because the donor often has no idea which candidates might benefit from the contribution, no

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candidate can predictably rely on receiving the money from a bequest, and neither candidates nor

political parties risk offending the donors of bequests once the money is received.

23. Although the Libertarian Party is the nation’s third-largest political party in terms of

elected officeholders, ballot access, and participation in federal, state, and local elections, the

Libertarian Party has never seen one of its candidates elected to federal office. No current federal

office holder is affiliated with the Libertarian Party. The Libertarian Party is thus not in any position

to deliver political favors in exchange for promises of future bequests.

24. The Supreme Court has previously upheld the Party Limit against a facial challenge,

applying a relaxed standard of review on the theory that individuals contributing to political parties

are typically engaged in associational, rather than expressive conduct. However, individuals acting

in a testamentary capacity are not exercising their associational rights, but their right of free speech

in desiring to leave a political legacy, a circumstance that the Supreme Court has not previously

considered. Laws restricting the solicitation and acceptance of testamentary contributions must

therefore be strictly scrutinized under the First Amendment.

25. Even if the testamentary donation could be viewed as an associational rather than

primarily expressive act, the Party Limit’s application to testamentary bequests does not “leav[e]

persons free to engage in independent political expression, to associate actively through volunteering

their services, and to assist to a limited but nonetheless substantial extent in supporting candidates

and committees with financial resources.” Buckley v. Valeo, 424 U.S. 1, 28 (1976) (per curiam).

26. In the absence of the Party Limit’s application to the Shaber bequest, the LNC would

substantially improve its ability to advocate and achieve electoral success by taking immediate

control over the balance of the Shaber funds.

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27. Considering the unenforceable nature of promises to make testamentary bequests; the

lack of coordination, let alone a quid-pro-quo relationship, between Joseph Shaber or anyone related

to him and the Libertarian Party; the Libertarian Party’s critical need for funds given its distant

third-party status; and the Libertarian Party’s inability, owing to its lack of elected federal

officeholders, to engage in a quid pro quo donor relationship even if it were inclined to make such

arrangements, application of 52 U.S.C. §§ 30116(a)(1)(B) and 30125 to Joseph Shaber’s bequest to

the LNC violates the First Amendment speech and associational rights of the LNC and its

supporters. Such application significantly hampers the LNC in its ability to attract and advocate for

its candidates and does not serve any valid governmental interest.

COUNT TWO

VIOLATION OF U.S. CONST. AMEND. I – RIGHT OF FREE SPEECH

CONTENT-BASED RESTRICTIONS OF 52 U.S.C. §§ 30116, 30125

28. Paragraphs 1 through 27 are incorporated as though fully re-stated herein.

29. The Party Limit discriminates against LNC based on the content of LNC’s speech.

LNC is allowed to accept only $33,400 per year from individuals if it would use that money for

general expressive purposes, but it can accept individual donations in the amount $100,200 to speak

through a convention, to promote itself via the establishment of a headquarters building, and to pay

attorneys to speak on its behalf. The LNC could even accept any combination of these $100,200

donations, in addition to the $33,400 limit for general expressive purposes.

30. Content-based restrictions on speech are subject to strict scrutiny. Yet there is not

even a rational basis to imagine that a $33,401 donation for general expressive purposes might

corrupt the political process, but a $100,200 donation for a political party’s lawyers, a $100,200

donation for a political party’s convention, a $100,200 donation for a political party’s headquarters

building, a $300,600 donation to a political party for all three purposes—or even a $334,000

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donation to a political party for general purposes and the maximum amount for each of the favored

purposes—would not be corrupting.

31. Because they favor, on their face, the acceptance of funds based on the content of a

political party’s speech, 52 U.S.C. §§ 30116(a)(1)(B) and 30125 violate the First Amendment

speech and associational rights of the LNC and its supporters.

COUNT THREE

VIOLATION OF U.S. CONST. AMEND. I – RIGHT OF FREE SPEECH

CONTENT-BASED RESTRICTIONS OF 52 U.S.C. §§ 30116, 30125

AS APPLIED TO THE SHABER BEQUEST

32. Paragraphs 1 through 31 are incorporated as though fully re-stated herein.

33. Plaintiff LNC could accept the entire balance of the Shaber bequest immediately if it

agreed to spend the bulk of the money on attorney fees, a convention, or a building. Because LNC

prefers to spend that money to express itself generally, it can access only a small portion of the

Shaber bequest every year.

34. Accordingly, 52 U.S.C. §§ 30116(a)(1)(B) and 30125 violate the First Amendment

speech and associational rights of the LNC and its supporters.

PRAYER FOR RELIEF

WHEREFORE, Plaintiff Libertarian National Committee, Inc. requests that judgment be

entered in its favor and against Defendant as follows:

1. An order permanently enjoining Defendant, its officers, agents, servants, employees,

and all persons in active concert or participation with it who receives actual notice of the injunction,

from enforcing 52 U.S.C. §§ 30116 and 30125, either generally or in relation to the Shaber

Bequest;

2. Declaratory relief consistent with the injunction;

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3. Costs and attorneys’ fees pursuant to any applicable statute or authority; and

4. Any other further relief as the Court deems just and appropriate.

Dated: January 25, 2016 Respectfully submitted,

Alan Gura (D.C. Bar No. 453449)

Gura & Possessky, PLLC

916 Prince Street, Suite 107

Alexandria, VA 22314

703.835.9085/Fax 703.997.7665

By: /s/ Alan Gura

Alan Gura

Attorney for Plaintiff

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