No. 13-5358

ORAL ARGUMENT HAS NOT YET BEEN SCHEDULED

IN THE

United States Court of Appeals

for the District of Columbia Circuit __________________

COMBAT VETERANS FOR CONGRESS POLITICAL ACTION COMMITTEE 

AND DAVID H. WIGGS, TREASURER

Appellants,

v.

FEDERAL ELECTION COMMISSION

Appellee.

__________________

On Appeal From the

United States District Court for the District of Columbia

in Case No. 11-2168 (CKK)

__________________

BRIEF FOR APPELLANTS COMBAT VETERANS FOR CONGRESS 

POLITICAL ACTION COMMMITEE AND DAVID H. WIGGS, 

TREASURER

_______________

PAUL D. KAMENAR DAN BACKER

 (D.C. Bar No. 914200) (D.C. Bar No. 996641)

COOLIDGE-REAGAN DB CAPITOL STRATEGIES, PLLC

 FOUNDATION 203 South Union Street, Suite 300

1629 K Street NW, Suite 300 Alexandria, VA 22314

Washington, DC 20006 (202) 210-5431

(202) 603-5397 DBacker@DBCapitolStrategies.com

Paul.Kamenar@Gmail.com

August 18, 2014 Counsel for Appellants

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CERTIFICATE AS TO PARTIES, RULINGS, AND RELATED CASES

A. Parties and Amici

The following parties appeared before the district court as plaintiffs and now 

appear before this Court as appellants: Combat Veterans For Congress Political 

Action Committee and David H. Wiggs, Treasurer. The following party appeared 

before the district court as the defendant and now appears before this Court as 

appellee: Federal Election Commission.

B. Rulings Under Review

The ruling under review is contained in the Memorandum Opinion issued on 

September 30, 2012 by United States District Court Judge Colleen Kollar-Kotelly.

C. Related Cases

This case was originally before the United States District Court for the 

District of Columbia as Case No. 1:11-cv-02168-CKK. There are no related cases.

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TABLE OF CONTENTS

Page

CERTIFICATE OF PARTIES, RULINGS,

AND RELATED CASES ...........................................................................................i

TABLE OF AUTHORITIES .................................................................................... ii

GLOSSARY OF ABBREVIATONS ........................................................................v

STATEMENT OF JURISDICTION..........................................................................1

STATUTORY PROVISIONS ...................................................................................1

STATEMENT OF ISSUES .......................................................................................1

STANDARD OF REVIEW.......................................................................................4

STATEMENT OF THE CASE..................................................................................4

A. Proceedings Before The Federal Election Commission.............................4

B. Proceedings Before The District Court.....................................................11

C. Proceedings Before The Court Of Appeals..............................................11

SUMMARY OF ARGUMENT...............................................................................12

ARGUMENT...........................................................................................................16

I. THE DISTRICT COURT ERRED BY NOT

CONSIDERING CVFC’S CLAIM THAT THE

PURPORTED FINDING OF LIABILITY AND

IMPOSITION OF FINES ARE NULL AND VOID

BECAUSE THE COMMISSIONERS FAILED TO CAST

THE REQUISITE NUMBER OF “AFFIRMATIVE VOTES” ..............................16

A. The District Court Erred In Not Reaching The Merits Of

CVFCs Challenge To FEC’s Voting Procedures..........................................17

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1. CVFC Was Not Required To First Present The FEC’s

Defective Voting Procedure To The Commission .............................17

2. The District Court Erred In Concluding That It

Could Not Review The Actual Ballots Used By The

FEC Because The FEC Failed To Submit Them As

Part of the Administrative Record ......................................................21

B. The Commissioners Did Not Cast At Least Four

Affirmative Votes In This Case And Thus The Enforcement

Action Is Null And Void And Should Be Vacated .......................................26

1. Voting at the “Reason to Believe” Stage ........................................27

2. Voting at the Final Determination Stage.........................................30

C. FEC Directive No. 52 Is Invalid Because It Was

Promulgated In Secret In Violation of the Sunshine Act..............................35

II. THE DISTRICT COURT ERRED IN RULING THAT

THE FEC’S FAILURE TO IMPOSE PERSONAL LIABILITY

ON CVFC’s TREASURER WAS A CONSIDERED

DECISION BY THE COMMISSION AND NOT AN

ABUSE OF DISCRETION OR OTHERWISE ARBITRARY ..............................40

A. Treasurers, Not Committees, Are Required Under

FECA and FEC Regulations and Policies to File Reports

and Are Personally Liable For Failure to Comply With Their 

Responsibilities Under the Act......................................................................43

B. FEC Staff Recommendation on Treasurer’s Personal Liability ..............47

III. THE DISTRICT COURT ERRED IN REJECTING

CVFC’S CLAIMS THAT THE FEC FAILED TO EXERCISE

ITS DISCRETION OR THAT ITS DECISION NOT TO

MITIGATE THE FINES WAS ARBITARY AND CAPRICIOUS .......................48

IV. THE FEC’S “BEST EFFORTS” REGULATION IS

ARBITRARY AND CAPRICIOUS........................................................................55

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CONCLUSION........................................................................................................58

ADDENDUM

CERTIFICATE OF COMPLIANCE

CERTIFICATE OF SERVICE

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GLOSSARY OF ABBREVIATIONS

ABBREVIATION DEFINITION

AF Administrative Fine

CVFC Combat Veterans For Congress PAC

FECA Federal Election Campaign Act

OAR Office of Administrative Review

OGC Office of General Counsel

RAD Reports Analysis Division

RTB Reason to Believe

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STATEMENT OF JURISDICTION

The district court had jurisdiction under 2 U.S.C. 437g(a)(4)(C)(iii) and 28 

U.S.C. 1331.

This Court’s jurisdiction over the appeal from the district court’s order 

granting Summary Judgment for the FEC and denying Summary Judgment for 

CVFC rests on 28 U.S.C. 1291. JA7.

The district court order was entered on September 30, 2013 and the 

Appellants filed a timely notice of appeal on November 26, 2013. JA4

STATUTORY PROVISIONS

The pertinent statutes, regulations, and other authorities are reproduced in 

the Addendum to this brief.

STATEMENT OF ISSUES

1. Whether the district court erred by failing to even consider Appellants’ claim 

that the Federal Election Commission’s “Reason to Believe” findings and Final 

Determinations that Appellants violated the reporting provisions of the Federal 

Election Campaign Act (FECA) and fining them a total of $8,690 was “(A) 

arbitrary, capricious, an abuse of discretion or otherwise not in accordance with 

law; *** (C) in excess of statutory jurisdiction, authority, or limitations, or short of 

statutory right; [and/or] without observance of procedure required by law” where 

FECA, 2 U.S.C. 437g (a)(2) and 11 C.F.R. 111.32 and 11 C.F.R. 111.37 require an 

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“affirmative vote” of at least four Commissioners to make such findings and 

determinations but where the number of actual ballots cast by the Commissioners 

in this case show that the requisite number of affirmative votes cast was less than 

four.

a. Whether the Federal Election Commission’s “Reason to Believe” findings and 

Final Determinations were “(A) arbitrary, capricious, an abuse of discretion or 

otherwise not in accordance with law; *** (C) in excess of statutory jurisdiction, 

authority, or limitations, or short of statutory right; [and/or] without observance of 

procedure required by law” where FECA, 2 U.S.C. 437g (a)(2) and 11 C.F.R. 

111.32 and 11 C.F.R. 111.37 require an “affirmative vote” of at least four 

Commissioners to make such findings and determinations but where the number of 

actual ballots cast by the Commissioners in this case show that the requisite 

number of affirmative votes cast was less than four.

2. Whether the district court erred by ruling that the Commission’s failure to hold 

the Committee’s then-treasurer, who failed to file disclosure reports on time, liable 

in his personal capacity either solely or jointly where the statute, FEC regulations, 

and published guidance from the FEC clearly provides for such imposition of 

liability was “(A) arbitrary, capricious, an abuse of discretion or otherwise not in 

accordance with law” under 5 U.S.C. 706(2) where the record shows, as here, that 

the treasurer’s failure to do so was knowing, willful, or reckless. 

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3. Whether the district court erred by ruling that it did not have jurisdiction to 

consider the Commission’s failure to even consider holding the then-treasurer, who 

acted knowingly, wilfully, or recklessly, liable for failing to file timely disclosure 

reports where the Commission’s own regulations require that it “will consider the 

treasurer to have acted in a personal capacity and make findings accordingly.” 70 

Fed. Reg. 3.

4. Whether the district court erred by ruling that the Commission’s failure to 

mitigate or reduce the fine imposed was not arbitrary or capricious, especially 

where the administrative record does not show that the Commissioners even 

considered the mitigation arguments raised by Appellants at the administrative 

level and therefore failed to even exercise their discretion. 

5. Whether the district court erred in ruling that the Commission’s refusal to 

consider the Appellants’ “best efforts” in “obtain[ing], maintain[ing] and 

submit[ting] the information” required for the disclosure reports which would 

otherwise “shall be considered in compliance with the Act” under 11C.F.R. 111.35 

was not arbitrary or capricious.

6. Whether the district court erred in ruling that 11 C.F.R. 111.35 is neither 

arbitrary nor capricious on its face or as applied.

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STANDARD OF REVIEW

This Court’s review of the district court’s ruling is de novo. See Coburn v. 

McHugh, 679 F.3d 924, 928 (D.C. Cir. 2012).

STATEMENT OF THE CASE

A. Proceedings Before the Federal Election Commission

Appellant Combat Veterans For Congress Political Action Committee 

(CVFC) is a non-partisan, non-connected political action committee registered 

with the Federal Election Commission. CVFC raises and disburses funds for the 

purpose of influencing Federal elections. It endorses, contributes to, and otherwise 

supports the election of carefully vetted candidates who are combat veterans of any 

active or reserve component of the United States Military, and who meet other 

ideological and/or policy related standards determined by the organization. 

Michael Curry was registered then as both the treasurer and custodian of records.

On October 15 2010, the 2010 October Quarterly Report became due, and 

Mr. Curry did not timely file. On October 21, 2010, less than a week later, the 12-

Day Pre-General Election Report became due, and Mr. Curry did not timely file

that report either. On November 4, 2010, the FEC sent Mr. Curry a Notice of 

Failure to File regarding the October 2010 Quarterly Report. JA132. On November 

21, 2010, Mr. Curry electronically filed the 2010 October Quarterly Report, thirty 

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seven (37) days after it became due. On December 2, 2010, the 30-Day PostGeneral Election Report became due, and Mr. Curry did not timely file that report.

On December 13, 2010, Captain Joseph R. John, Chairman of CVFC, 

contacted the FEC called Mr. McAllister seeking guidance on changing the 

treasurer because Mr. Curry, was on his way out as the committee’s Treasurer and 

he wanted to know what he needed to do to change the Treasurer. He was advised 

that once a new treasurer was selected, the committee needed to submit that 

person’s name. As for the status of the overdue reports, he was advised that while 

the reports would be late due the absence of the treasurer, but that he should 

submitted as “soon as possible in order to mitigate any fines or penalties.” On 

December 15, 2010, the Commission purportedly found Reason to Believe 

(“RTB”) by an affirmative vote of 6-0 that CVFC and its then-Treasurer Curry 

violated 2 U.S.C. 434(a) by failing to timely file the October Quarterly Report by 

October 15, 2010, and transmitted that information to Mr. Curry. JA105.

1

 

1 In fact, as further described the Declaration of the Plaintiffs’ counsel, Dan Backer, 

JA64, CVFC learned only two days prior to filing its Motion for Summary 

Judgment below that this Certification claiming that six Commissioners 

affirmatively voted to find RTB appears to be inaccurate. In reality, only three of 

the six Commissioners affirmatively voted (four being necessary under FECA to 

find reason to believe), and even those three did not actually “find reason to 

believe”; rather, they merely “did not object” to the staff report recommending that 

the Commissioners should find reason to believe. JA80-82. See 2 U.S.C. § 

437g(a)(2).

5

 

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On January 11, 2011, the delinquent Pre-Election Report and Post- Election 

Reports, which were due on October 21, 2010 and December 2, 2010, respectively, 

were filed due to the best efforts of CFVC due to assistance of the new treasurer 

David H. Wiggs and other resources used by CFVC to get the reports filed as 

quickly as possible. See JA272-75..

On March 11, 2011, the FEC purportedly found reason to believe by an 

affirmative vote of 6-0 that CVFC’s Pre-General Election Report was filed after 

the deadline of October 21, 2010. JA238. However, as with the first reason to 

believe on December 15, 2010, this Certification also appears to be false. Instead 

of six affirmative votes, there were only two affirmative votes (four being 

necessary under FECA) and those two votes were also merely a “do not object” 

vote to the staff report.

With respect to the late reports, Capt. John sent letters to the FEC asserting 

that the conduct of the former Treasurer, Mr. Curry, made it impossible for CVFC

to timely file and that the CVFC exercised its best efforts to obtain the bank 

records and other information, retain a bookkeeper to conduct an audit, and take 

other steps necessary to file the three reports as soon as practicable under the 

circumstances. JA248. Capt. John specifically identified former Treasurer, Mr. 

Curry as the only person with access to “ten months of records, bank deposit slips, 

the bank statements, personal information on Web site donors, the personal records 

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on each of the estimated 210 donors, the password to make electronic reports, and 

the knowledge of how to electronically submit FEC Reports.” Id. Additionally, 

Capt. John articulated that best efforts were employed to “obtain substantial 

missing information as quickly as humanely [sic] possible, assembled and audited 

that information in a timely manner, expending approximately 600 man hours of 

work, reconstructed the donor information in the proper electronic format, and 

fully complied with FEC Reporting requirements.” JA249.

On March 25, 2011, the FEC purportedly found reason to believe by an 

affirmative vote of 6-0 that CVFC’s 30 Day Post-General Election Report was 

filed after the deadline of December 2, 2010. JA327. However, as with the reason 

to believe findings on December 15, 2010 and March 11, 2011, this Certification 

also appears to be false. Instead of six affirmative votes, there were only three 

affirmative votes (four being necessary under FECA) and those three votes were 

also simply a “do not object” vote to the staff report.

On March 31, 2011, Capt. John responded as he did before explaining that 

the late filing was due to the wilful and reckless conduct of its former treasurer

JA338.

On June 15, 2011, Dayna C. Brown, Reviewing Officer for the Office of 

Administrative Review (OAR), while not disputing Capt. John’s statement of 

reasons for the late filings, sent CVFC the Recommendation of the Reviewing 

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Officer regarding the RTB for the October 2010 Quarterly Report affording the 

respondents only 10 days to file a written response to the Recommendation. 

JA140-42. On June 17, 2011, Ms. Brown sent CVFC the Recommendation of the 

Reviewing Officer regarding the RTB for both the Pre- and Post-General Election 

Reports. JA268-71.

On June 24, 2011, counsel for CVFC filed a written response to the 

Reviewing Officer Recommendation regarding the October 2010 report, the PreGeneral Election Report and the Post-General Election Report that clearly 

established the factual and legal basis why Mr. Curry was solely liable, in his 

personal capacity, for the knowing, willful, and reckless conduct that precipitated 

these fines. JA311-13.

On August 18, 2011, the Office of General Counsel (“OGC”) submitted a 

Memorandum to Dayna Brown providing legal guidance on the disposition of 

these actions. JA314-18. Notably, the OGC in Part III heading of its 

memorandum concluded that CVFC allegations with respect to the reckless 

conduct of their former treasurer “MIGHT JUSTIFY PURSUING [THE 

FORMER] TREASURER PERSONALLY.” Id. at 3 (emphasis added). The 

memorandum also noted that the “Commission could conclude that [Mr. Curry’s] 

actions constituted a reckless failure to fulfill his duties as treasurer.” Id. at 4. 

More significantly, the OGC noted that the Commission “could consider Mr. 

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Curry’s actions as possible mitigating factors in determining the civil penalty for 

the Committee’s violations.” Id. at 5. 

On October 12, 2011, the FEC’s Chief Compliance Officer, Patricia 

Carmona and Reviewing Officer Dayna Brown, made a Final Determination 

Recommendation to the Commission for all three late filings AF#s 2199, 2312, and 

2355 that CVFC and its new Treasurer David Wiggs violated 2 U.S.C. § 434(a) 

and to assess respective penalties of $4,400, $3,300, and $990 against them for an 

aggregate of $8,690. JA319-21. Notably, Ms. Brown requested that “the 

Commission consider the issue of the [former] Treasurer’s personal responsibility 

in these matters.” Id. at 3. 

On October 27, 2011, the Commission without meeting and without 

providing the CVFC or its counsel with an opportunity to be heard, summarily 

“approved” by a vote of 6-0 the Reviewing Officer’s recommendation that the 

Commissioners should make a Final Determination. However, the Commissioners 

did not themselves act on that recommendation and did not explicitly make a 

finding or Final Determination that CVFC in fact violated 2 U.S.C. § 434(a) for 

filing late the three reports in question: October Quarterly Report, the 12-Day PreElection, and the 30-Day Post-Election Report. JA86-91. The Commissioners 

further purported to asses a civil fines against the committee and it current 

treasurer instead of the former treasurer in his personal capacity for each such late 

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filing in the amount of $4,400, $3,300, and $990, respectively, for an aggregate 

amount of $8,690. JA322-23. The Commission failed to exercise its discretion and 

address the request by its Reviewing Officer that the Commission consider the 

issue of the former Treasurer’s personal liability or whether his actions would be a 

mitigating factor in determining the civil penalties against CVFC. The 

Commission also did not give CVFC an opportunity to be heard in person before 

the full Commission before making its Final Determination.

On November 4, 2011, notice of the alleged Final Determination was sent to 

CVFC by certified mail and received by certified mail on November 10. On 

November 23, 2011, CVFC counsel sent a letter by courier to the Chair of the 

Commission requesting expedited action that the Commission vacate its Final 

Determination as being premature inasmuch as it did not give the respondents a 

hearing before the full Commission under 2 U.S.C. § 437g(a)(4)(C)(ii). JA327-

329. Alternatively, the Commission was asked to reconsider the matter since it 

neglected to consider the personal liability of the former Treasurer as being solely 

liable for the fine or at a minimum to mitigate the penalty on CVFC and its current 

Treasurer, and preserving its procedural and substantive rights, including its claim 

that its Due Process and First Amendment rights were violated. Id.

On December 9, 2011, the FEC denied CVFC’s request for reconsideration, 

a hearing, and mitigation of the fine. JA330.

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B. Proceedings Before The District Court

On December 7, 2011, CVFC and its current treasurer filed a timely Petition

for Review of the FEC’s Determination and Complaint for Declaratory and 

Injunctive Relief challenging the FEC’s enforcement action as authorized by 2 

U.S.C. 437g(a)(4)(C)(iii) and 28 U.S.C. 1331 seeking to modify or set aside the

agency determination. Per the scheduling order, on June 7, 2012 CVFC filed their 

motion for summary judgment. On June 25, 2012, CVFC filed an Amended 

Petition and Complaint raising the additional claim that the FEC’s voting 

procedures were invalid.

Cross motions were filed by the FEC and the case was submitted to the 

court. On September 30, 2013, the district court granted the FEC’s motion and 

denied the plaintiffs and entered an order to that effect. The plaintiffs filed a 

timely notice of appeal to this Court on November 26, 2013.

C. Proceedings In The Court of Appeals

On January 27, 2014, the FEC filed a Motion for Summary Affirmance. On 

March 3, 2014, Appellants filed their Opposition to the motion. On March 25, 

2014, the FEC filed its reply. On May 13, 2014, this Court denied the FEC’s 

motion and set the case for plenary briefing and argument.

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SUMMARY OF ARGUMENT

In this case, the fundamental locus of accountability embedded by statute, 

regulation, and rule within the entire campaign finance regime – the personal 

liability of Committee Treasurers for knowing, wilful, or reckless malfeasance –

has been ignored wholesale by the Federal Election Commission, the very agency 

charged with enforcing the law as it is clearly written. More disturbing, the agency 

itself engaged in a series of unlawful practices to remove accountability of the 

Commissioners from their own decision making processes. If the decision below 

were to stand, the result would be an agency whose exercise of its powers 

conferred by Congress would be openly violative of its organic statute and 

promulgated regulations, the Administrative Procedure Act, and the Sunshine Act, 

and would erode the only measure of integrity from campaign finance law.

1. The district court erred by refusing to consider CVFC’s claim that the 

FEC’s “reason to believe” finding and “Final Determination” against CVFC and its 

current treasurer were invalid and void ab initio because the Commission never 

cast at least four “affirmative votes” as required by FEC’s organic statute for either 

action. 2 U.S.C. 437g(a)(2); 11 C.F.R. 111.32. The court, reasoning the claim 

should have first been presented to the Commission for consideration at the agency 

level, was in error because CVFC was not and could not have been aware of the 

defective procedures at the agency level. Moreover, CVFC does not raise this 

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issue to attack the merits of the underlying enforcement action, but rather to 

challenge the adequacy of the agency’s voting procedure; thus, the rules of 

exhaustion of remedies do not apply in such circumstances. 

The court’s second reason for not adjudicating CVFC’s voting claim was 

equally flawed. The court concluded that because the documentary evidence 

supporting that claim, namely, the actual ballots used by the Commissioners, were 

not provided by the FEC in the Administrative Record, they would be not be 

considered. However, CVFC was not aware of the existence of the questionable 

ballots until after litigation commenced, requested them from the FEC, and 

promptly submitted them to the court for its consideration since the FEC had only 

submitted a blank sample ballot with the Administrative Record. Because the 

ballots themselves were generated and maintained exclusively by the FEC, and 

since they relate to the validity of the voting procedure, there was no prejudice to 

the agency if the court were to consider them. 

As to the merits of CVFC’s voting procedure claim, the ballots show that the 

Commissioners did not cast “four affirmative” votes in any of the three 

administrative fine proceedings in this case, as required by 2 U.S.C. 437g(a)(2). 

Rather, the Commission has devised a novel procedure whereby if a Commissioner 

does not return his or her ballot on the matter within 24 hours after being provided 

a copy, that silence and non-action would be deemed to constitute an “affirmative 

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vote” authorizing enforcement action to be taken against CVFC and similar 

respondents. In this case, at the “reason to believe” stage, there never were the 

requisite four votes submitted in any of the three administrative fines proceedings 

in this case. Therefore, the enforcement action was void ab initio. The subsequent 

Final Determination of liability and the imposition of penalties were tainted since 

the predicate “reason to believe” finding was not lawfully made, and additional 

apparent errors, such as the Commissioner’s ballots being signed by persons other 

than the Commissioners who may not have been properly authorized to do so. 

Finally, FEC Directive No. 52, which purports to give the FEC the authority to 

utilize this novel “no show- no vote” procedure is itself defective since it was 

secretly promulgated in violation of the Sunshine Act.

2. The district court further erred in upholding the FEC’s failure to impose –

or even consider – personal liability on CVFC’s former treasurer and the 

Commissions creation from whole cloth of a new species of prosecutorial 

discretion to substitute parties into enforcement actions in direct contravention of 

Congress’s express mandate. Notwithstanding the mountain of clear statutory and 

regulatory provisions that provide that the “treasurer,” rather the committee, is 

personally responsible for filing the reports and will be personally liable when they 

are knowing, wilful, or reckless in failing to fulfill his or her duties, the court 

erroneously held that the statute “clearly imposes reporting responsibility on 

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committees.” JA22. Alternatively, the court’s Chevron deference to the agency 

was misplaced, since there was no ambiguity as to who is responsible for filing the 

reports nor as to the scope of the former Treasurers knowing, willful or reckless 

conduct. CVFC also argues that it was arbitrary, capricious, contrary to law, and an 

abuse of discretion for the FEC not to impose any liability, even jointly, on the 

Treasurer due to his wilful and reckless conduct in failing to file the required 

reports. 

3. Finally, the court erred by rejecting CVFC’s claim that the FEC 

arbitrarily failed to exercise its discretion or abused it by not mitigating the fine 

imposed on CVFC due to the malfeasance of the treasurer, especially where the 

Office of General Counsel and Reports Analysis Division made the 

recommendation that it consider such mitigation. Despite CVFC using its best 

efforts to compile and submit the disclosure reports as promptly as possible, with 

full knowledge by the FEC of the exact nature of the delay, the court below also

erred in ruling that the FEC did not abuse its discretion in precluding CVFC from 

invoking FEC’s “best efforts” defense found in 11 C.F.R. 111.35. By its own 

terms, the “best efforts” regulation does not and cannot preclude raising “reckless 

or wilful” conduct of the treasurer to mitigate the fine imposed on the committee; 

consequently, the FEC’s failure to even exercise its discretion was arbitrary and 

capricious, and the regulation is arbitrary and capricious as applied. Secondly, to 

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the extent that the defenses are limited to those only listed in the regulation, the 

regulation is over- and under inclusive as to the circumstances that can be used as a 

defense, and is otherwise arbitrary and capricious on its face.

ARGUMENT

I. THE DISTRICT COURT ERRED BY NOT CONSIDERING CVFC’S 

CLAIM THAT THE PURPORTED FINDING OF LIABILITY AND 

IMPOSITION OF FINES ARE NULL AND VOID BECAUSE THE 

COMMISSIONERS FAILED TO CAST THE REQUISITE NUMBER OF 

“AFFIRMATIVE VOTES” 

In their Amended Petition for Review and Complaint, CVFC challenged the 

validity of the FEC’s enforcement action alleging that the FEC failed to comply 

with the statutory requirements that the Commissioners’ findings at both the 

“reason to believe” stage and the final determination stage that a violation occurred 

must be made “by an affirmative vote of 4 of its members” as required by statute 

and the FEC’s own regulations. 2 U.S.C. 437g(a)(2); 11 C.F.R. 111.32; 111.37(a). 

See Amend. Pet. For Review, JA51-52. Consequently, the FEC’s enforcement 

action was “in excess of statutory jurisdiction” and “without observance of 

procedure required by law” and thus null and void. 5 U.S.C. 706(d). Accordingly, 

this Court need not reach any of the other issues in this appeal and should remand 

this case to the district court to adjudicate this preliminary issue. Alternatively, 

this Court may decide that based on the uncontroverted evidence that the requisite 

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four affirmative votes were not cast, the case should be remanded with instructions 

to vacate the FEC’s purported finding of liability and imposition of the $8,690 fine.

A. The District Court Erred In Not Reaching The Merits Of CVFCs 

Challenge To FEC’s Voting Procedures

The district court improperly declined to consider the merits of CVFC’s 

challenge that the requisite “affirmative votes” of four Commissioners was lacking, 

and the agency action was thus a nullity because (1) CVFC did not first raise the 

issue with the FEC at the administrative level, and (2) the actual ballots which 

evidence the improper voting procedure were not part of the administrative record 

filed by the agency, and thus, should not be considered by the court. JA35-36. 

The FEC reiterated those two reasons in its unsuccessful Motion for Summary 

Affirmance. The district court and FEC are wrong on both counts.

1. CVFC Was Not Required To First Present The FEC’s 

Defective Voting Procedure To The Commission

The district court declined to adjudicate the voting procedure claim citing 

the general rule that the court should not “usurp[] an agency’s function if it sets 

aside an administrative determination upon a ground not theretofore presented and 

deprives the agency of an opportunity to consider the matter, make its ruling, and 

state the reasons for its actions.’” JA35 (quoting Coburn v. McHugh, 679 F.3d 

924, 931 (D.C. Cir. 2012) (quoting Unemployment Comp. Comm’n of Alaska v. 

Aragon, 329 U.S. 143, 155 (1946)).

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First, CVFC had no reason to raise the unlawful voting issue before the 

FEC. The December 21, 2010 letter sent by the FEC to the treasurer notifying 

him about the reason to believe finding simply stated that “the FEC found that 

there is reason to believe (“RTB”)” that a violation of 2 U.S.C. 434(a) occurred. 

JA106. There was no indication of the actual vote tally. Once this suit was filed 

and the FEC submitted the Administrative Record to the district court below, the 

formal Certifications by the FEC’s Secretary and Clerk were also submitted 

attesting to the votes cast by the Commissioners at the RTB stage and the final 

determination stage. The Certification by the Commission Secretary certified that 

the FEC on December 15, 2010, “[d]ecided by a vote of 6-0 to: (1) find reason to 

believe that COMBAT VETERANS FOR CONGRESS PAC, and CURRY, 

MICHAEL MR. as treasurer violated 2 U.S.C. § 434(a) and make a preliminary 

determination that the civil money penalty would be the amount indicated on the 

report . . . . Commissioners Bauerly, Hunter, McGahn II, Peterson, Walther, and 

Weintraub voted affirmatively for the decision.” JA105 (emphasis added). Similar 

Certifications were executed for the final determination stage. JA208. From all 

appearances and representations, it would seem that the FEC complied with the 

statutory requirement that any enforcement action at both the “reason to believe” 

stage and the “final determination” stage must be approved by at least “four 

affirmative votes.” These “certifications” were false and misleading.

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It was only after examining the Administrative Record that included only the 

“blank” voting sheets used by the Commissioners as part of the record did CVFC 

suspect that the Certifications of the votes did not accurately reflect the actual 

“affirmative votes” cast by the Commissioners. Accordingly, counsel for CVFC 

pressed the FEC attorneys to disclose the actual ballots. JA66. Despite some 

reluctance on the part of the FEC, those ballots were provided two days before the 

filing of CVFC’s Motion for Summary Judgment. As demonstrated supra, there 

were at best only three votes cast to find reason to believe. 

Shortly thereafter, CVFC filed an Amended Petition for Review and 

Complaint on June 19, 2012, notably with the consent of the Commission, raising 

an additional and dispositive claim that the entire agency enforcement action was 

null and void since the Commissioners did not comply with the statute’s voting 

procedures of casting at least four “affirmative votes” to initiate this enforcement 

action and make a final determination of liability and assessing a fine. JA51-52. 

Under these circumstances, CVFC can hardly be faulted for not raising the voting 

issue at the agency level since they had no reason to believe the voting was 

questionable at the time. Nor should the FEC be heard to complain that CVFC is 

raising the issue in this litigation inasmuch as the FEC consented to the filing of 

the Amended Complaint for the purpose of challenging the validity of the voting 

procedure.

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Second, even if CVFC had access to the voting ballots or suspected that the 

voting procedures did not comply with the statutory requirement at the 

administrative level, bringing that issue before the agency would have been a futile 

exercise. As evidenced by the FEC’s submissions on the merits in the district 

court, the FEC maintains that its “no show- no vote” procedures fully satisfy the 

“affirmative vote” requirements of the statute and regulations because the FEC 

adopted Directive 52, which purports to authorize such voting procedure., a 

position which was vigorously disputed and briefed by CFVC in the district court, 

In that regard, the district court’s reliance on Coburn v. McHugh, 679 F.3d

924, 930 (D.C. Cir. 2012) for the proposition that the court cannot consider the 

merits of this issue is misplaced. JA35 (Op. at 29). In Coburn, this Court upheld 

that portion of the district court’s decision not to consider certain of the plaintiff’s 

arguments regarding his involuntary separation from the United States Army, on 

the ground that these claims had not been raised during plaintiff’s initial challenge 

of the separation decision. Id. at 930-31. In the instant case, however, the claim 

at issue does not relate to merits of the underlying facts that were the basis for the 

FEC’s staff investigation, but instead goes to the validity of whether a decision 

itself was lawful. Moreover, the plaintiff in Coburn could have raised the issue but 

chose not to; CVFC had no such opportunity.

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The general rule of exhaustion of administrative remedies does not apply in 

situation such as this where the agency has already predetermined the issue, and 

hence, it would have been futile to challenge the FEC’s voting procedures before 

the agency. See McCarthy v. Madigan, 503 U.S. 140, 148 (1992). Exhaustion is 

also not required where, as here, “the challenge is to the adequacy of the agency 

procedure itself. . . .” Id. Moreover, as noted supra, CVFC simply could not have 

exhausted any administrative remedy here because it had no reason to believe then 

that less than four “affirmative votes” were cast in this case. 

2. The District Court Erred In Concluding That It Could Not Review 

The Actual Ballots Used By The FEC Because The FEC Failed To 

Submit Them As Part of the Administrative Record

The district court’s related holding that it could not reach the merits of 

CVFC’s voting procedure claim because the voting ballots themselves were not 

part of the administrative record is clearly erroneous. The general rule that a 

reviewing court should focus on the administrative record made at the agency is 

only applicable where the material sought to be presented for the first time to the 

reviewing court by an aggrieved party relates to the merits of the underlying facts 

or dispute that was before the agency. That is why, for example, the district court 

in Cunningham v. FEC, 2002 U.S. Dist. LEXIS 20935 (S.D. Ind. Oct. 28, 2002) --

relied upon by the FEC below and which also involves the assessment of a fine for 

filing a campaign finance report late -- correctly refused to consider an Affidavit 

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by the candidate swearing the disclosure report was timely filed. That Affidavit 

was signed more than a year after the FEC’s decision and the filing of his lawsuit. 

Id. at *15 n.3. 

Here, the voting ballots and documents submitted by CVFC were documents 

generated by the agency itself during the enforcement proceedings. Those voting 

ballots do not relate to the circumstances of or factual defenses to the late filing of 

the campaign finance reports; rather, they go to the validity of the Commissioners’ 

votes. In short, the FEC is in no position to complain that they are prejudiced by 

the submission and consideration of the actual ballots they used in this 

enforcement action. They “certified” that six affirmative votes were cast yet only 

supplied a blank ballot sheet in the Administrative Record. If in fact the ballots 

reflecting the Commissioners’ votes were required to be part of the Administrative 

Record and not just a blank ballot, it was the FEC’s fault for not submitting the 

actual ballots to the district court along with the Administrative Record. 

Normally, “the focal point for judicial review should be the administrative 

record already in existence, not some new record made initially in the reviewing 

court.” Camp v. Pitts, 411 U.S. 138, 142 (1973). “The task of the reviewing court 

is to apply the appropriate APA standard of review to the agency decision based on 

the record the agency presents to the reviewing court.” Florida Power & Light Co. 

v. Lorion, 470 U.S. 729, 743-44 (1985) (internal citations omitted). “But of 

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course, it is black-letter administrative law that in an APA case, a reviewing court 

‘should have before it neither more nor less information than did the agency when 

it made its decision.’” Hill Dermaceuticals, Inc. v. FDA, 709 F.3d 44, 47 (D.C. 

Cir. 2013) (quoting Walter O. Boswell Mem'l Hosp. v. Heckler, 749 F.2d 788, 792, 

242 U.S. App. D.C. 110 (D.C. Cir. 1984). This Court has recognized a small class 

of cases where district courts may consult extra-record evidence when “the 

procedural validity of the [agency]'s action . . . remains in serious question.” Esch 

v. Yeutter, 876 F.2d 976, 991 (D.C. Cir. 1989) (emphasis added). 

In this case, the FEC’s jurisdictional infirmity could not have been known 

until (1) the administrative record was filed with the court, (2) plaintiffs inquired 

about the omission from the administrative record, and (3) the FEC produced from 

its own records the actual ballots that illuminated the infirmity. The FEC’s own 

documents that formed the basis for its Secretary’s certification that the district 

court declined to consider illustrate just such a serious question. This is a case in 

which the district court should have considered the FEC’s documents because “‘it 

may sometimes be appropriate to resort to extra-record information’ to determine 

whether an administrative record is deficient.” Theodore Roosevelt Conservation 

P’ship v. Salazar, 616 F.3d 497, 514 (D.C. Cir. 2010) (quoting Esch v. Yeutter, 876 

F.2d at 991)).

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The infirmity in the completeness of the administrative record is manifest. 

This court has held that an agency enjoys a presumption that it properly designated 

the administrative record absent clear evidence to the contrary, but the agency does 

not unilaterally determine what constitutes the administrative record. Bar MK 

Ranches v. Yuetter, 994 F.2d 735, 739-40 (10thCir. 1993). In this instance, the 

FEC’s own documents that CVFC wished the district court to consider show that 

the agency deliberately or at best negligently excluded documents that may have 

been adverse to it by demonstrating that the agency failed to comply with statutory 

requirements and its own regulations, and thus frustrated judicial review of that 

agency action. See City of Dania Beach v. FAA, 628 F.3d 581, 590 (D.C. Cir. 

2010); American Wildlands v. Kempthorne, 530 F.3d 991, 1002 (D.C. Cir. 2008); 

James Madison Ltd. by Hecht v. Ludwig, 82 F.3d 1085, 1095 (D.C. Cir. 1996). 

The district court’s refusal to consider such clear concrete evidence that the FEC 

failed to include documents that cast serious doubt on the authority of the FEC’s 

action was in error and warrants reversal of the district court’s judgment.

Moreover, the issue here does not go to the substance of the agency’s 

decision, but to its validity ab initio because the question is whether the agency 

followed required procedures in voting to take enforcement action against CVFC. 

The restrictions on completing or supplementing an administrative record are not 

implicated and other evidence may be considered when a challenge is brought to 

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“the procedural validity of [an agency's] action.” Esch v. Yeutter, 876 F.2d 976, 

991 (D.C. Cir. 1989); see also Franks v. Salazar, 751 F. Supp. 2d 62, 68 (D.D.C. 

2010); The Cape Hatteras Access Preservation Alliance v. U.S. Dep't of Interior, 

667 F. Supp. 2d 111, 115 (D.D.C. 2009).2

 

Finally, it should be noted that CVFC filed a combined Petition for Review 

of the FEC’s enforcement action as provided for by 2 U.S.C. 437g(a)(4)(C)(iii) 

and Complaint for Declaratory and Injunctive Relief under 28 U.S.C. 1331, 2201, 

and 5 U.S.C. 701-706. Thus, the claim challenging the validity and sufficiency of 

the votes, and the voting ballots submitted as evidence in support of that claim, can 

also be considered as a separate challenge to agency action under 28 U.S.C. 1331 

under typical APA review provisions that an agency’s action was “in excess of 

statutory jurisdiction, authority, or limitations” or “without observance of 

procedure required by law.” 5 U.S.C. 706(2)(C)-(D)7. This jurisdictional basis 

stands apart from the specific judicial review provisions of FEC enforcement 

actions provided by statute, 2 U.S.C. 437g(a)(4)(C)(iii).

2 Cf. D.C. Circuit Handbook on Internal Practices and Procedures at 22 (“The 

record on review [in cases from administrative agencies] consists of the order 

sought to be reviewed or enforced; the findings or report on which it is based; and 

the pleadings, evidence, and proceedings before the agency. The record may later 

be corrected or supplemented by stipulation or by order of this Court, as in the case 

of an appeal from the district court”. (emphasis added). The record on review does 

not appear to comprise the votes cast by a multi-member agencies, but if it must, 

the record could be easily supplemented by the court as CVFC suggested to the 

court below.

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In short, the district court’s conclusion that CVFC’s challenge to the 

sufficiency and validity of the votes “are not properly before th[e] Court and will 

not be addressed” because the issue was not first raised by CVFC at the 

administrative level and that the ballots used by the Commissioners were not part 

of the Administrative Record compiled by the FEC is clearly erroneous and should 

be reversed. 

B. The Commissioners Did Not Cast At Least Four Affirmative Votes 

In This Case And Thus The Enforcement Action Is Null And Void And 

Should Be Vacated.

Because the record is clear that the Commission failed to cast the required 

four “affirmative votes” in this enforcement action, this Court, instead of vacating 

the judgment and remanding to the district court to consider this issue, may 

conclude that the FEC’s action was “in excess of statutory jurisdiction, authority, 

or limitation” or “without observance of procedure required by law” under 5 

U.S.C. 706(2)(C)-(D). In that case, this Court could remand with instructions to 

vacate the FEC’s determinations. At a minimum, a discussion of the merits of 

CVFC’s claim will inform this Court of the fatal defects in the voting procedures 

used in this case.

As noted in the Statement of Facts, the three enforcement actions for the 

three reports in question were each purportedly initiated by an affirmative vote of 

at least four Commissioners as required by law. Indeed, the Commission’s 

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Secretary and Clerk certified in each of the three enforcement matters on three 

separate occasions that the Commission “Decided by a vote of 6-0 to (1) find 

reason to believe that COMBAT VETERANS FOR CONGRESS PAC, and 

WIGGS, DAVID H. MR. as treasurer violated 2 U.S.C. § 434(a) and make a 

preliminary determination that the civil money penalty would be the amount 

indicated on the report. . . .” “Commissioners Bauerly, Hunter, McGahn II, 

Peterson, Walther, and Weintraub voted affirmatively for the decision.” See JA105, 

JA238, JA344. On its face, these Certifications indicate that the Commission’s six 

“affirmative votes” satisfied the statutory requirement of a minimum of four 

affirmative votes necessary for Commission action.

1. Voting at the “Reason to Believe” Stage

As the evidence before the district court demonstrated, the FEC considers a 

Commissioner as casting an “affirmative vote” at the reason to believe stage when 

that Commissioner simply does not “cast” any vote at all. According to the 

unlawful voting procedures described in the questionably promulgated FEC

Directive 52 which the FEC relied upon below, a Commissioner need do nothing at 

all for 24 hours after being sent a staff memo to have this failure to act count as 

casting an “affirmative vote” to initiate enforcement action. “Matters circulated 

on a 24-hour no-objection basis shall be deemed approved unless an objection is 

received in the Commission Secretary’s Office by the voting deadline.” Directive 

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No, 52 at 3 (Add. 61). Under this voting system, a Commissioner could be on 

vacation, out of the country, sick, or his or her email may be malfunctioning or 

simply ignored or not opened. Silence will be counted as casting an “affirmative 

vote.” 

The actual breakdown of all the votes at the “reason to believe” stage in 

these three proceedings provided by the Commission is as follows:

Signed 24-Hour No-Objection Ballot Votes for Reason to Believe on 

AF# 2199: Dated December 15, 2010:

Commissioner Bauerly: Do Not Object

Commissioner Walther: Do Not Object (signed by another)

Commissioner Weintraub: Do Not Object

Summary: 3-0 Missing are three “no shows- no votes” and one 

questionable vote signed by another. Four “affirmative votes” lacking.

Signed 24-Hour No-Objection Ballot Votes for Reason to Believe on 

AF# 2312: Dated March 11, 2011

Commissioner Walther: Do Not Object (signed by another)

Commissioner Weintraub: Do Not Object (signed by another)

Four “no show-no votes.” Two questionable ballots signed by another.

Summary: 2-0: Missing are four “no show-no votes”. Two questionable 

ballots signed by another. Four “affirmative votes” lacking.

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Signed 24-Hour No-Objection Ballot Votes for Reason to Believe on 

AF# 2355 Dated March 25, 2011

Commissioner Bauerly: Do Not Object 

Commissioner Walther: Do Not Object (signed by another)

Commissioner Weintraub: Do Not Object

Summary: 3-0: Missing are three “no show-no votes”. One questionable 

ballot signed by another. Four “affirmative votes” lacking.

Clearly, in all three proceedings, there were never the requisite four 

“affirmative votes” to find reason to believe, and several that were cast and signed 

by someone other than the Commissioner may be invalid even under the terms of 

the FEC’s Directive No. 52, the validity of which will be discussed, infra. Indeed, 

even by the very terms of Directive No. 52, the FEC itself does not consider 

silence by a Commissioner to constitute an “affirmative vote.” Section II C of that 

Directive states with Commission’s authorization and approval of the publication 

of the names of non-filers, that publication “will occur immediately after the vote 

deadline or as soon as there are four affirmative votes.” Id. at 3; Add. 61 

(emphasis added). This statement is a clear admission by the FEC that even they 

do not regard mere silence as constituting an “affirmative vote.”

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2. Voting at the Final Determination Stage

Moreover, with respect to the votes that were actually cast at the final 

determination stage, challenges were raised by CVFC below to the validity of four 

of the six votes that were submitted by some Commissioners after the FEC selfimposed deadline for voting and/or were signed by someone other than the 

Commissioner. This latter issue also raises a factual question regarding the 

existence and validity of staff authorization,3

 and is material evidence which the 

FEC refused to provide to CVFC below and thus precluding summary judgment

for the FEC. See JA68-91. The breakdown of the votes at the Final Determination 

stage were as follows:

Signed Ballot Votes for Final Determination Recommendation on AF#’s 

2199, 2312, and 2355 Dated October 26, 2011

Commissioner Bauerly: I approve the recommendation(s) (signed by 

another)

Commissioner McGahn: I approve the recommendation(s)

Commissioner Petersen: I approve the recommendation(s) (signed by 

another) (submitted after stated ballot deadline)

3 Directive No. 52 purports to allow Commissioners have their staff sign their 

names but with certain restrictions which may not have been followed in this case, 

thereby possibly voiding even those questionable “Do Not Object” ballots cast 

both at the reason to believe stage and the “I approve the recommendations” ballots 

cast at the final determination stage. See Id. at 4. Add. 62.

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Commissioner Hunter: I approve the recommendation(s) (submitted after 

stated ballot deadline)

Commissioner Walther: I approve the recommendation(s) (signed by 

another)

Commissioner Weintraub: I approve the recommendation(s)

Summary: Six signed ballots but four are disputed: three questionable 

ballots signed by another with one of those submitted after the deadline and one 

questionable ballot submitted after the deadline. 

Assuming there were at least four valid “affirmative votes,” CVFC further 

challenged the legal sufficiency of the action resulting from any such vote, since 

the Commissioners did not actually make any final determination as such, issue 

any order, or impose any fine; at best, they merely did not object to a staff 

recommendation that they should make a final determination. Thus, this claim 

raises both factual and legal issues that are unresolved as to the validity and impact 

of these final determination votes, already tainted by the clear failure of the 

Commission to cast four “affirmative votes” at the reason to believe stage. 

This is not the first instance in which a multi-member agency has acted 

without statutory authority as shown by its own voting records. The National 

Labor Relations Board, required by statute to conduct actions by a quorum of three 

of its five members, adopted an electronic voting mechanism under which 

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members may “participate” in agency action. In that case, the third member 

needed to constitute a quorum had expressed his dissenting views on earlier 

iterations of the proposal under consideration but did not vote on the final version. 

The NLRB asserted that he was a member of the Board when the final rule was 

circulated and was sent a notification that it had been called for a vote, even though

not voting would constitute an abstention but still constitute being present for 

purposes of a quorum. 

In a well-reasoned opinion, the district court found that a quorum was not 

present, although had the member “affirmatively expressed his intent to abstain or 

even acknowledged receipt of the notification [of the meeting], he may well have 

been legally ‘present’” to constitute a quorum.” Chamber of Commerce of the 

United States v. NLRB, 879 F. Supp. 2d 18, 25 (D.D.C. 2012) (summary judgment 

granted to plaintiffs), appeal dismissed, 2013 U.S. App. LEXIS 25897 (D.C. Cir. 

Dec. 9, 2013). The court said that the “NLRB is a ‘creature of statute’ and 

possesses only that power that has been allocated to it by Congress.” Id. at 30 

(citing Michigan v. EPA, 268 F.3d 1075, 1081 (D.C. Cir. 2001). 

After considering a supplemental affidavit submitted by the NLRB on a 

motion to reconsider that the member’s deputy chief counsel had opened the 

electronic agenda item when the meeting began, and argued that the Member was 

therefore virtually “present” for the meeting, the court denied the motion for being 

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too little and too late, and further noted that there was “no indication that [the 

Member’s employees] were authorized to vote or abstain on his behalf . . . .” Id. 

at 32. In the same fashion, there was no “affirmative vote” or even 

acknowledgement that the Commissioner received the “no-objection” ballot. The 

FEC acted in violation of its organic statute by failing to act with a minimum of 

“four affirmative votes,” notwithstanding Directive No. 52’s purported 

authorization for them to do so.4 In both cases, the agencies acted in violation of 

their organic statutes; the results should not be different based on the party 

submitting the agency’s evidence of that failure.

Unlike the FEC’s novel argument that a “no show-no vote” constitutes an 

“affirmative vote” to take agency enforcement action, the typical practice for 

multi-member agencies for is for agency commissioners to cast their vote at a 

public meeting or submit their written vote for those matters that may be disposed 

of without a meeting. See, e.g., 16 C.F.R. 4.14(c) (“Any [Federal Trade] 

4

 As noted, several of the 24-Hour ballots in this case show that they were signed 

by someone other than the Commissioner to whom it was sent, and purportedly on 

their behalf. JA78-85. Even Directive No. 52 were lawfully promulgated and 

valid, it specifies that the ballot can be signed by staff “provided the Commissioner 

has given instructions to the staff member regarding the matter being acted on and 

the staff member is acting in accordance with those instructions.” Directive No. 52 

at 4 (App. 62) (emphasis added). While those instructions are to be kept with the 

record, the FEC has refused to provide those alleged authorizations to CVFC. Just 

as in the NLRB case, those staff authorizations may be found wanting should this 

Court remand this case to the district court for further proceedings. 

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Commission action, either at a meeting or by written circulation, may be taken 

only with the affirmative concurrence of a majority of the participating 

Commissioners, except where a greater majority is required by statute or rule. . . .”) 

(emphasis added). Moreover, such votes are made a matter of public record. See, 

e.g., 16 C.F.R. 4.9(b)(ii) (“final votes of each member of the Commission in all 

matters of public record, including matters of public record decided by notational 

voting”).

More importantly, unlike the district court below, other courts carefully 

examine the facts in cases where there are challenges to the validity of a 

Commissioner’s vote in agency enforcement and other administrative actions. See 

Braniff Airways, Inc. v. Civil Aeronautics Board, 379 F.2d 453, 462 (D.C. Cir. 

1967) (concluding the notational vote cast was valid and that the evidence supports 

the conclusion that the “signature of the Chairman was affixed to the opinion while 

he was still competent to vote.”); Federal Trade Comm’n v. Flotill Products, Inc., 

389 U.S. 179 (1967) (Court determines that sufficient quorum of FTC 

Commissioners validly acted on matter despite resignation of two Commissioners); 

Corus Group PLC v. Bush, 217 Supp. 2d 1347 (C.I.T. 2002) (Commissioner made 

valid “affirmative. . . findings” and express “determinations” and was properly 

appointed to his position).

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C. FEC Directive No. 52 Is Invalid Because It Was Promulgated In 

Secret In Violation of the Sunshine Act

The FEC defended the validity of Directive No. 52 that purportedly 

authorized “No-Objection” voting by arguing that it has the authority to 

promulgate their own “rules for the conduct of its activities,” citing 2 U.S.C. § 

437c (e) and Vermont Yankee Nuclear Power Corp. v. Natural Res. Defense 

Council, Inc., 435 U.S. 519, 542-43 (1978) (agency can devise “their own rules of 

procedure”). While an agency can certainly promulgate its own rules of procedure, 

it is axiomatic that those rules cannot deviate from the requirements of the 

agency’s organic statute or the agency’s own regulations published in the Code of 

Federal Regulations. See Doe v. United States Dep’t of Justice, 753 F.2d 1092, 

1098 (D. C. Cir. 1985). 

While the district court did not reach the voting issue, this Court may wish to 

decide the issue because the voting procedures in this case were defective as a 

matter of law, and remand this case to the district court with instructions to vacate 

the FEC’s action. Thus, the question of the validity of Directive No. 52 which 

purported to authorize such voting is also implicated. In that regard, the FEC has 

promulgated a number of rules of procedure for conducting their affairs published 

in the Code of Federal Regulations, including the procedures for conducting its 

meetings under the Government in the Sunshine Act, 5 U.S.C. 552b. See 11 

C.F.R. Part 2; see also 11 C.F.R. Part 111. Add. 20, 28. The provenance of 

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Directive No.. 52, however, suggests it was unlawfully promulgated under these 

procedures.

As for the FEC’s Sunshine Act regulations, FEC rules state that the 

Commission need not hold a meeting to decide whether a future meeting should be 

closed to the public under the exemptions allowed under the Sunshine Act, but that 

the vote to close all or part of such future meeting may be cast by using the FEC’s 

“notation vote procedures.” 11 C.F.R. 2.5(c). That “notation vote” is in the form 

of a written vote rather than a voice vote or a no-objection or silent vote. 

Presumably, these “notation votes” are equivalent to what the FEC calls “tally 

votes” in Directive No. 52 where, in contrast to “no objection” matters, in order to 

be counted, an actual vote must be physically cast. Id. at 2. Add. 60

In addition , FEC’s Compliance Procedures, 11 C.F.R Part 111, applicable 

to this case, provide for various procedures that the FEC has chosen to establish, 

such as how complaints are to be filed, the use of written questions and subpoenas 

during investigations, conciliation procedures, and the like, but there is nothing in 

those provisions that mentions “notation vote procedures,” “tally votes,” or ‘noobjection” voting that relieves the Commissioners of their responsibility as 

expressly mandated by statute to cast at least “four affirmative votes” to initiate 

enforcement actions. Add. 28.

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In addition to these rules of procedure, there are a number of policy 

statements and directives not published in Code of Federal Regulations that 

describe the procedures of certain other FEC enforcement activities and the 

issuance of advisory opinions. However, there is only one document that purports 

to be a rule of procedure pursuant to 2 U.S.C. 437c(e) as the FEC claimed below it 

has the authority to issue: Directive No. 10, appropriately entitled “RULES OF 

PROCEDURES OF THE FEDERAL ELECTION COMMISSION 

PURSUANT TO 2 U.S.C. 437c(e).” 

Directive No. 10 was adopted on December 20, 2007 and, unlike other 

directives, was published in the Federal Register, 73 Fed. Reg. 5568 (Jan. 30, 

2008), Add. 52. Directive No. 10 revised the Commission’s 1978 Rules of 

Procedure for the conduct of its meetings, specifically to address the situation 

where the Commission has less than four members due to vacancies. On 

September 10, 2008, however, the FEC held a secret meeting ostensibly authorized 

under the Sunshine Act to consider several matters, including the proposed 

Directive No. 52.5

 That Directive purported to allow the Commissioners to 

5 While CVFC obtained from the FEC the final certified vote of that meeting 

approving Directive No. 52, they were denied a copy of any transcript or recording 

of the meeting. This portion of the meeting should not have been closed to the 

public under the Government in the Sunshine Act. There was no notice of the 

September 10, 2008 meeting in the Federal Register that this agenda item was 

going to be discussed, and even if it were specifically listed, the ostensible 

boilerplate in the notice for closing that part of the meeting only covers items 

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discharge their statutory duties of finding “reason to believe” by “affirmative 

votes” on so-called “No-Objection Matters” by either not casting any vote at all for 

a 24-hour period or by returning the “no objection” ballot within 24 hours signed 

by the Commissioner. As previously noted, if none of the Commissioners returned

his or her ballot, they are all “deemed” to “approve” the staff recommendation to 

launch certain enforcement actions, and this non-voting will be certified by the 

Commission Secretary as a 6-0 affirmative vote of finding of “reason to believe” 

that a respondent has violated the law.

CVFC learned from the FEC after this litigation commenced that Directive 

No. 52 was approved by a bare majority of 4-2 during the Commission’s 

September 10, 2008 Executive Session, a closed meeting that was in clear violation 

of the Government in the Sunshine Act. And unlike Directive No. 10 governing 

the agency procedures, Directive No. 52, which by its own terms was designed to 

“supplement other Commission documents” including Directive No. 10 (see id. at 

1, n.1, Add. 59), was never published in the Federal Register.6

involving “Internal personnel rules and procedures or matters affecting a particular 

employee.” That exemption under the Sunshine Act, however, is inapplicable 

regarding important agency voting procedures such as this. Lest there be any 

doubt about the narrow reading of that exemption under the Sunshine Act and its 

analog in the Freedom of Information Act, the Supreme Court made clear that this 

exemption is limited to personnel matters. See Milner v. Dep’t of Navy, 1341 

S.Ct. 1259 (2011).

6 Directive No. 52 is also buried on the Commission’s website where it would be 

difficult for the public to find. The left side of FEC’s homepage

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Secondly, whatever authority the FEC may have to devise its “rules for the 

conduct of its activities,” that authority does not permit the FEC to contravene the 

statutory command requiring the Commission to “find” reason to believe a 

violation occurred and that such finding must garner at least “four affirmative 

votes” not the “votes” of silent Commissioners who, for all we know, did not even 

receive a copy of the staff recommendation since not even acknowledgement of 

receipt is required. As noted, in the instant case, there were no more than three 

“Do Not Object” votes in each of the three fine cases and even several of those 

were signed by the Commissioner’s assistant, thereby raising questions about the 

validity of those so-called “votes.” 

The FEC’s deviation from the statutory required voting procedures is not an 

isolated example of the Commission’s blatant disregard of the law. For example, 

(http://www.fec.gov) has links to useful information for political committees and 

the public, including the link for “Law, Regulations, & Procedures” which in turn 

has a drop down menu for additional documents under several categories, 

including “Policy Statements & Other Procedures” and “Procedural Materials.” 

Remarkably, neither Directive No. 52 nor any of the other FEC’s Directives are to 

be found there where one would expect them to be. After searching around, one 

has to access “About the FEC” at the top of the homepage, which lists general 

matters about the FEC, its budget, and similar information, and even then, the drop 

down menu does not list the FEC’s Directives as one of the items. But if one 

happens to scroll down to the very bottom of that page, there is a link FEC’s 

Directives. See Add. 64-67. In short, CVFC and others regulated by the FEC 

could be forgiven for not knowing about the FEC’s unusual voting procedures 

found in the secretly considered and secretly promulgated Directive No. 52 with 

which the FEC seems to playing “hide the ball.”

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Congress made it clear that “members of the Commission shall not engage in any 

other business, vocation, or employment” 2 U.S.C. 437c(a)(3) (emphasis added); 

Add. 3. Yet, despite this clear and unambiguous command of no outside 

employment, the Commissioners promulgated a regulation that states a “member 

of the Commission shall not devote a substantial portion of his or her time to any 

other business, vocation, or employment.” 11 C.F.R. 7.9(a) (emphasis added). 

This “substantial portion” qualification to outside employment is in direct defiance 

of Congress’s command that Commissioners devote all of their professional time 

to FEC business with no exceptions. This provision, like the non-voting “voting” 

procedures, while certainly convenient for the Commissioners, is contrary to the 

statute. 

In sum, Directive No. 52’s “No-Objection” voting procedure allowing 

silence by a Commissioner to constitute an affirmative vote to take enforcement 

action violates the FEC’s organic statute and was promulgated in violation of the 

Sunshine Act.

II. THE DISTRICT COURT ERRED IN RULING THAT THE FEC’S 

FAILURE TO IMPOSE PERSONAL LIABILITY ON CVFC’s 

TREASURER WAS A CONSIDERED DECISION BY THE COMMISSION 

AND NOT AN ABUSE OF DISCRETION OR OTHERWISE ARBITRARY

The district court ruled that it lacked jurisdiction to consider CVFC’s claim 

that its treasurer should be held personally liable for the fines because such claims 

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are not permitted in the context of a Petition for Review filed under 2 U.S.C. 

437g(a)(4)(C)(iii). JA24-25. The lower court erred for two reasons.

First, nothing in section 437g(a)(4)(C)(iii) limits the arguments that a person 

may make in its “written petition requesting that the determination be modified or 

set aside.” See also 11 C.F.R. 111.38 (respondent may request “that the final 

determination be modified or set aside.”). The only exception in the FEC 

regulation is that a “failure to raise an argument in a timely fashion during the 

administrative process shall be deemed a waiver of the respondent’s right to 

present such argument in a petition to the district court under 2 U.S.C. 437g.” Id. 

There is certainly no dispute that CVFC raised the argument of treasurer personal 

liability during the administrative process; hence, that argument was clearly 

preserved. 

Secondly, CVFC brought this action under 28 U.S.C. 1331 and 5 U.S.C. 

702-706 as well, and therefore, the court had jurisdiction to consider CVCF’s 

treasurer liability claim under those provisions. JA39. While CVFC did not file a 

formal complaint against its errant treasurer with the FEC under 2 U.S.C. 

437g(a)(8)(A) for violating FECA’s reporting provisions as the district court 

noted, JA24-25, it was not required to do so in order to seek judicial review of the 

FEC’s failure to hold the treasurer personally liable, either solely or jointly, given 

the detailed record in the FEC’s possession as to the treasurer’s malfeasance. As 

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discussed further, infra, the statutory provisions and FEC’s own regulations make 

clear that the treasurer is personally responsible and liable for filing timely reports.

Accordingly, the failure of the agency to impose sanctions on the guilty party 

caused injury to CVFC for which it can seek judicial review. Moreover, the FEC 

is required by 2 U.S.C. 437g(a)(2) to consider investigating and taking 

enforcement action against individuals “on the basis of information ascertained in 

the normal course of carrying out its supervisory responsibilities” without 

requiring the filing of a formal complaint. Such information was clearly provided 

by CVFC to the FEC here and, as will be shown, even the FEC’s Office of General 

Counsel recommended the Commissioners to consider the issue of the treasurer’s 

personal liability.

Reaching the merits of the treasurer’s personal liability, the district court 

alternatively held that the FEC “has broad discretionary power whether to 

investigate a claim, and whether to pursue civil enforcement under [FECA]” and, 

therefore, the court could not conclude that the agency “abused its discretion in 

choosing not to pursue Mr. Curry in his personal capacity for wilful or reckless 

failure to file reports.” JA26. The court erred for two reasons. First, the Court 

mistakenly observed that the “Commission considered Mr. Curry’s potential 

liability, and has supplied reasonable grounds for its failure to prosecute him in his 

personal capacity” and that the Commission made a “decision[] . . . not to pursue 

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Mr. Curry in his personal capacity for willful or reckless failure to file the reports.” 

JA26 (emphasis added). Putting aside CVFC’s argument regarding defective 

voting as to whether the Commissioners made any legally valid decision at all, the 

record does not reflect that the Commissioners “considered” or “decided” 

anything regarding the treasurer’s personal liability, let alone supplying 

“reasonable grounds” for its failure to investigate and prosecute Mr. Curry 

personally, as the district court erroneously claimed it had. JA25. Moreover, the

failure to pursue Mr. Curry does not give the FEC prosecutorial discretion to name 

a party not considered to be responsible by the relevant statute. 

A. Treasurers, Not Committees, Are Required Under FECA and FEC 

Regulations and Policies to File Reports and Are Personally Liable For 

Failure to Comply With Their Responsibilities Under the Act.

A close examination of the plethora of FEC statutory provisions, regulations, 

and policies expressly imposing personal liability on treasurers to file committee 

reports -- coupled with the FEC’s enforcement staff recommendations to the

Commissioners that the treasurer’s personal liability be pursued in this case --

further demonstrates that the Commissioners either did not consider these 

authorities, and therefore failed to exercise their discretion, or arbitrarily ignored 

these authorities and enforcement duties without articulating “reasonable grounds” 

for their alleged decision, as the agency was required to do. See Nader v. FEC,

823 F. Supp. 2d 53, 65 (D.D.C. 2010). 

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Under FECA, “[e]ach treasurer of a political committee shall file reports of 

receipts and disbursements in accordance with the provisions of this subsection. 

The treasurer shall sign each such report.” 2 U.S.C. § 434(a)(1) (emphasis added). 

Congress placed the responsibility to file reports squarely on treasurers, not on 

committees. See also 2 U.S.C. 432(c) (requiring treasurers to keep account of 

committee records); 432(d) (requiring treasurers to maintain records for three 

years). Congress intended through these FECA provisions to impose personal 

responsibility on treasurers as the only statutory officer required for the formation 

and operation of political committees. Congress did not impose reporting 

obligations on political committees themselves, or committee chairmen or other 

committee officers since the treasurer is the only statutory officer of a committee. 

The FEC, through its implementing regulations, has further underscored 

Congress’s imposition of personal liability on the treasurer. See 11 C.F.R. 

104.14(d) (“Each treasurer of a political committee, and any other person 

required to file any report or statement under these regulations and under the Act, 

shall be personally responsible for the timely and complete filing of the report or 

statement and for the accuracy of any information or statement contained in it.”) 

(emphasis added); 11 C.F.R. 114.12 (“Notwithstanding the corporate status of the 

political committee, the treasurer remains personally responsible for carrying out 

their respective duties under the Act”) (emphasis added); 11 C.F.R. 104.1(a) (“Who 

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must report. Each treasurer of a political committee...shall report in accordance 

with 11 C.F.R. Part 104.”) 

In addition to the statutory provisions and the FEC’s rules and regulations 

that impose affirmative legal duties upon Treasurers of political committees, FEC 

policy guidance also confirm that “the violation of [reporting requirements] makes 

[Treasurers] personally liable.” See Federal Election Commission Statement of 

Policy Regarding Treasurers Subject to Enforcement Proceedings, 70 Fed. Reg. 1, 

5 (Jan. 3, 2005) (emphasis added); Add. 49. The law consistently tasks treasurers 

with affirmative legal obligations and duties, the violation of which subjects

treasurers, and only treasurers, to personal liability. Congress did not empower the 

FEC to transfer this personal responsibility and pass it off to the committee or a 

blameless successor treasurer.

As the FEC has recognized:

Indeed, if FECA were construed to impose liability on treasurers only in 

their official capacities, it would effectively mean that only committees are 

liable for violations under the statute--which would have been easy enough 

for Congress to accomplish by writing the Act to impose reporting, 

recordkeeping, and other duties on ‘committees’ rather than ‘treasurers.’

Federal Election Commission Proposed Statement of Policy Regarding Naming of 

Treasurers in Enforcement Matters, 69 Fed. Reg. 4092, 4093, n.6 (Jan. 28, 2004), 

Add. 44 (emphasis added).

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In addition to the statutory provisions and FEC rules, regulations, and policy 

guidances, federal courts have recognized the personal liability of political 

committee Treasurers. See FEC v. Toledano, 317 F.3d 939, 947 (9th Cir. 2002)

(the Act “holds [the treasurer] personally responsible for the committee's 

recordkeeping and reporting duties.”) (emphasis added); FEC v. Gus Savage for 

Congress '82 Comm. and Thomas J. Savage, Treasurer, 606 F. Supp. 541, 547 

(N.D. Ill. 1985) (“Liability . . . filters through the candidate to his amorphous 

campaign committee, or, more precisely, to the committee's treasurer, who is 

legally responsible for any violation of the Act. It is the treasurer, and not the

candidate, who becomes the named defendant in federal court, and subjected to the 

imposition of penalties ranging from substantial fines to imprisonment.”); FEC v. 

Dramesi for Congress Comm., 640 F. Supp. 985; 1986 U.S. Dist. LEXIS 22269

(treasurer assessed fine); FEC v. Dramesi for Congress Comm., No. 85-4039 

(MHC) (D.N.J. Sept. 5, 1990) (unpublished opinion 3) (“[A]n individual will also 

stand responsible for his indiscretions as a treasurer. It is because of the ephemeral 

nature of such political committees that Congress chose to place this burden upon 

treasurers.”) (emphasis added).7

7 Against the thick forest of statutory provisions and regulations imposing personal 

liability on treasurers for reporting, the court below cites only one provision, 2 

U.S.C. 434(a)(4), which states “All political committees other than authorized 

committees of a candidate shall file [the required reports.”] (emphasis added) . 

JA20. But it is significant to note that Congress required that with respect to these 

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B. FEC Staff Recommendation on Treasurer’s Personal Liability

The wealth of authority providing that the treasurer is personally liable 

circumscribes the FEC’s discretion to ignore that body of law. Moreover, FEC 

staff recommended in this case that the personal liability of Mr. Curry should be 

considered.

For example, the Reviewing Officer in this case, pursuant to guidance from 

the Office of General Counsel (“OGC”) “request[ed] that the Commission consider 

the issue of the Treasurer’s personal responsibility in these matters.” JA321. In a 

Memorandum to the Reviewing Officer, the Acting General Counsel not only 

stated in a bold heading that the allegations of recklessness against the former 

treasurer “MIGHT JUSTIFY PURSUING [THE FORMER] TREASURER 

“authorized committees of a candidate,” the “treasurer shall file” reports of a 

House or Senate candidate, 2 U.S.C. 434(a)(2)(A) (emphasis added) and that the 

“treasurer shall file” the reports for a Presidential candidate, 2 U.S.C. 434(a)(3) 

(emphasis added). Add. 2. Thus, as for committees “other than [candidate] 

committees,” it is reasonable and consistent to construe congressional intent as 

requiring the “treasurer” of those committees to file the required reports. In other 

words, since Congress was listing the filing duties of all political committees,

candidate and non-candidate alike, Congress intended for 2 U.S.C. 434(a)(4) to be 

read as follows: “[The treasurer of] [a]ll political committees other than authorized 

committees of a candidate shall file either. . . . “ This reading comports with the 

general mandate by Congress at the beginning of this section, 2 USC 434(a)(1), 

that “[e]ach treasurer of a political committee shall file reports...in accordance 

with this subsection,” which covers reporting by candidate and non-candidate 

committees. Therefore, the court erred by giving deference to the FEC’s 

incongruous reading of the law. JA22. Indeed, the FEC interprets this provision in 

it regulations as requiring only treasurers to report. 11 C.F.R. 104.1(a).

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PERSONALLY” but that if the FEC referred this matter to the OGC for pursuing 

personal liability against Mr. Curry in the enforcement context, the FEC “could 

consider Mr. Curry’s actions as possible mitigating factors in determining the civil 

penalty” for the Committee. JA318. (emphasis added). The OGC concluded 

thusly: “[t]herefore, we recommend that OAR raise this issue for the Commission’s 

consideration in the memorandum recommending final determinations in this 

matter.” JA318 (emphasis added). The OAR, as noted, did indeed raise and 

specifically request the FEC consider the issue of personal liability in its report to 

the FEC. JA321. But due to the questionable and cryptic voting procedures, the 

FEC has not clearly demonstrated that the Commissioners actually exercised their 

discretion or considered personal liability in this matter, let alone articulate the

requisite “reasonable grounds” for not pursuing the treasurer personally. The 

district court erred by concluding otherwise.

III. THE DISTRICT COURT ERRED IN REJECTING CVFC’S CLAIMS 

THAT THE FEC FAILED TO EXERCISE ITS DISCRETION OR THAT 

ITS DECISION NOT TO MITIGATE THE FINES WAS ARBITARY AND 

CAPRICIOUS 

Both the Office of General Counsel and the Reviewing Officer made it clear 

that the personal liability of the former treasurer, based on the substantial FEC 

record of his malfeasance, could serve to mitigate the fine against CVFC and its 

current Treasurer, presumably in whole or in part. See OGC Memorandum, 

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August 18, 2011 (”In the enforcement context [the Commission] could consider 

Mr. Curry’s actions as possible mitigating factors in determining the civil 

penalty.”) JA372; Reviewing Officer Final Determination Recommendation to 

the Commission , October 12, 2011 (“Mr. Curry’s actions could be considered as 

possible mitigating factors in determining the civil penalty for the Committee’s 

violations.”). JA374. 

Nevertheless, the district court accepted the argument by FEC’s attorneys in 

this litigation that the Commission’s alleged reasons for rejecting any mitigation of 

the fine imposed on CVFC was based on the FEC’s so-called “best efforts” 

regulation, 11 C.F.R. 11.35(b)(3)-(d), that severely and unreasonably limits the 

circumstances which can constitute “best efforts.” JA28-30. The court therefore 

“[could not] conclude that the” Commission’s decision lacked a rational basis and 

constituted an abuse of discretion.” JA29. 

In the first place, it is not clear based on the FEC’s cryptic and unlawful 

voting procedures that the Commissioners actually considered CVFC’s argument 

for mitigation at all or made any deliberative decision to reject it. Even if they did, 

they gave no reasons for the alleged decision not to mitigate the penalty imposed 

on CVFC. Nevertheless, the court below assumed that the alleged decision not to 

mitigate the penalty was based on the rigid “best efforts” regulation, and that it was 

not based on “any equitable considerations.” JA29 (Op.23) In particular, the court 

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accepted the FEC’s argument that mitigation of the fine was unwarranted because 

the circumstances of the late filings in this case did not fall within the narrow 

“unforeseen circumstances” specified in the “best efforts” regulation of 11 C.F.R. 

111.35(c). The FEC argued in its unsuccessful Motion for Summary Affirmance 

in this Court that the “knowing, wilful, and reckless” conduct by CVFC’s treasurer 

was “akin” to simple “negligence,” (FEC Motion at 14) and therefore not a 

circumstance warranting mitigation as the district court suggested. This was clearly 

erroneous.

The FEC’s “best efforts” regulation provides for two categories of 

circumstances that either qualify or disqualify for mitigation consideration. Those 

circumstances that do qualify for a “best efforts” defense are spelled out in 11 

C.F.R. 111.35(c) to include such things as the failure of Commission computer 

equipment, internet failures, or severe weather or other disaster-related incident. 

Add. 36. The circumstances that do not qualify, and thus are considered not 

“unreasonably foreseen” and “beyond the control of the respondent” are spelled 

out in 11 C.F.R. 111.35(d) to include simple “negligence,” 111.35(d)(1); “illness, 

inexperience, or unavailability of the treasurer,” 111.35(d)(3); or a Committee’s 

computer crashing or disruption caused by the Internet service provider failure 

even though due to no fault of the Committee. Add. 36 See JA28. 

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Importantly, however, the regulation specifies that both these categories of 

circumstances “include, but are not limited to” the examples listed. Here, the 

failure to file timely reports was due to the well-documented “knowing, wilful or 

reckless” conduct of the treasurer and not simple negligence. After difficulty 

obtaining the FEC password and expending days retrieving and compiling 

financial and contributor information that the former treasurer had left 

disorganized and inaccessible, CVFC promptly filed the required reports as 

humanly possible. Thus, CVFC was not foreclosed by the “best efforts” regulation 

from requesting that it considered for mitigation. While CVFC conceded at the 

administrative that its former treasurer was not entitled to the “best efforts” 

defense, it did not concede that it was not entitled to it either, as the FEC 

erroneously suggested below. Despite this apparent flexibility of the regulation, 

the district court erred when it cited with approval the FEC staff report noting that 

the defense is precluded “if it is based on any of the circumstances listed at 11 

C.F.R. 111.35d.” JA29 (emphasis added) citing AF2355-AR046. But CVFC’s 

defense of “reckless and wilful misconduct of the treasurer” is concededly not 

“listed” as an excludable category in the “best efforts” regulation. Moreover, with 

respect to excusable conduct of the treasurer, the regulation specifically excludes 

“inexperience” as an excuse, but not “knowing, willful or reckless conduct of the 

treasurer.” The fact that the FEC specifically considered treasurer conduct and 

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only included “inexperience” and simple “negligence” as “reasonably unforeseen” 

suggests that “knowing, willful, and reckless” conduct is something that a 

Committee does not reasonably foresee. 

In short, it appears that the FEC either did not fully understand or chose to 

ignore the discretion it possessed even under its “best efforts” regulation to 

consider the circumstances in this case as being eligible for mitigation under its 

regulation. Moreover, the FEC failed to consider that even if CVFC did not 

qualify for a “best efforts” defense, it had equitable discretion to mitigate the fine 

by considering the reasons such as those here, just as the FEC staff said it could. 

In that regard, the district court misconstrued CVFC’s arguments when it 

concluded that CVFC was “ ‘asking this Court to exercise its own judgment and 

rehear Plaintiffs’ [case before the Commission],’ ” citing FEC v. Democratic 

Senatorial Campaign Comm., 454 U.S. 27, 37 (1981). JA29. Rather, CVFC 

submits that the district court should remand the matter to the Commission to 

rehear and consider CVFC’s mitigation arguments because the agency failed to 

consider them properly the first time. On remand, the Commission may decide to 

remit all or part of the fine, particularly because of its excessiveness in comparison 

to culpability of CVFC when weighed alongside Mr. Curry’s “knowing, willful, or 

reckless” conduct.

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For example, the fines imposed on plaintiffs aggregating $8,690.00 for filing 

its reports late are unreasonable and are substantially greater -- in some cases by 

eightfold -- than fines that the FEC has imposed on other political and candidate 

committees which are found to violate far more serious, substantive provisions of 

FECA, such as receiving and failing to cure excessive contributions, or receiving 

prohibited contributions from corporations or foreign nationals. After all, while 

three reports of this small committee may have been filed late, it must be 

remembered that the overarching purpose of disclosure is to inform the voters of

the source of the candidate’s funds so they can make an informed decision in 

casting their ballots. Here, CVFC is an unaffiliated PAC unauthorized by any 

candidate. Any contributions made by CVFC to a candidate are reported on the

receiving candidate’s disclosure reports for voters to see what “special interest” 

funds are being contributed to the candidate. Because the recipient candidates filed 

their reports, the public interest in disclosure was not as paramount for a timely 

filing of the reports for CVFC, particularly where CVFC did not even make any 

campaign contributions or independent expenditures during the reporting periods 

in question. Yet, for purposes of both liability and the level of the fine, the 

Commission arbitrarily treats the two kinds of committees effectively the same, as 

it does all manner of campaign and non-campaign financial activity.

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Moreover, the arbitrariness of the $8,690 in fines imposed in this case is 

further underscored regarding the late filing of the October 2010 Quarterly Report 

that was originally due on October 15, 2010 but was filed late on November 21, 

2010. JA139-41. Since that report was filed just over 30 days late, the FEC treats 

the report as having never been filed at all in terms of assessing the level of fine 

which was $4,400. 11 C.F.R. § 111.43(e)(1). This puts a new twist on the old 

maxim, “better late than never.” According to the FEC’s arbitrary fine schedule, it

is “better never than late.” Treating a 31-day late report the same as one never 

filed at all is on its face arbitrary and capricious. In addition, the FEC would allow 

a committee to timely file a wholly deficient disclosure report without any late 

fines being assessed, and then allow the committee to “amend” its report after-thefact with the information that was required to be disclosed in the first place. 

Indeed, in this very case, after the reckless treasurer resigned and best efforts were 

expended to file the delinquent reports, CVFC undertook on its own initiative to 

amend earlier April and July Quarterly Reports 2010 that were timely filed but

found to be grossly deficient, with no penalty for the deficiencies. The FEC 

appears to promote an arbitrary message: File your reports on time and worry later 

about whether they were complete and accurate.

In sum, CVFC’s current Treasurer, Assistant Treasurer, and Chairman and 

other personnel used their best efforts to file the required reports as soon as 

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practicable following the malfeasance of its former treasurer. The malfeasance of 

the treasurer was not reasonably foreseeable and was beyond the control of the 

plaintiffs and, therefore, liability should not have been imposed on the plaintiffs 

and/or the fines should have been remitted in whole or in part. The failure by the 

Commission to consider mitigation in this case was an abuse of discretion.

IV. THE FEC’S “BEST EFFORTS” REGULATION IS ARBITRARY AND 

CAPRICIOUS

If the FEC is correct that it cannot mitigate the fine imposed on CVFC 

because of the FEC’s view of limited applicability of the “best efforts” regulation, 

then the regulation is arbitrary and capricious on its face. The lower court erred by 

concluding that it was not. As CVFC argued below, the regulation is both overinclusive and under-inclusive. It excuses “unforeseeable” events like severe 

weather (which in fact is often foreseeable due to weather forecasts), but does not 

excuse what the FEC considers “foreseeable” events and those not “beyond the 

control” of a respondent (and therefore is not a “best efforts” defense) such as the 

committee’s computers being suddenly attacked by a virus, or the treasurer being 

suddenly attacked by a virus or falling ill from food poisoning the night before the 

report is due, falling dead from a heart attack or accident (and thus is “unavailable” 

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under the regulation), or going into premature labor .

8 11 C.F.R. § 111.35(d)(3). In 

such cases, the FEC will not accept these reasons as “best efforts” to comply with 

the filing deadline. This regulation is clearly arbitrary and capricious and 

unreasonable on its face because it arbitrarily excludes the opportunity to raise 

both legal and equitable reasons before the Commission to explain the late filings.

On its face, the FEC’s “best efforts” regulation is not rational to the extent that it 

forecloses any consideration of other mitigating circumstances.

The district court, referring to the FEC’s argument below, stated that if

“recklessness and negligence on the part of the treasurer - of the sort at issue here -

were to qualify for ‘best efforts’ then the exception would swallow the rule and 

almost all late filings would be excusable.” JA29-30. Not so. The conduct of the 

“sort at issue here” was not simple negligence but “knowing, wilful and reckless” 

and promptly brought to the attention of the Commission. That kind of conduct 

would not make “almost all late filings excusable.” A Committee would be 

required by the FEC to submit evidence in such cases, as CVFC did here, 

8

 Indeed, the FEC rejected a candidate’s failure to timely file a post-election report 

in a special election which he lost and where the voters’ interest in such postelection reports by definition will not inform the electorate in casting their vote, 

due to the campaign’s treasurer going into premature labor just before the election 

as a reason for filing the report late. The FEC fined the small campaign $8,000. 

Presumably the FEC believes that the treasurer’s premature labor was both 

“foreseen” and “under [her] control.” See Kuhn for Congress v. FEC, Civ.. No.. 

2:13-3337 (PMD-BHH) (D.S.C.,Charleston Div.), available on FEC’s website at 

http://www.fec.gov/law/litigation/Kuhn.shtml

56

 

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demonstrating that the treasurer was not simply negligent, but engaged in wilful 

and reckless conduct that the Committee could not foresee. There was no evidence 

or claim that CVFC was negligent in managing its treasurer that would estop 

CVFC from asserting a “best efforts” defense. On the contrary, CVFC made 

repeated attempts to correct the situation, but was prevented from doing so by the 

malfeasant Treasurer.

More significantly, a showing by a committee that its treasurer was “wilful 

and reckless” in not complying with the reporting requirements will not make

“almost all late filings excusable” nor preclude the FEC from sanctioning and 

imposing appropriate fines on the guilty party – the treasurer himself – which

procedure provides the only measure of proper accountability within the regulatory 

scheme and proper deterrence.9

 

To the extent that plaintiffs’ best efforts to remedy the malfeasance of its 

former treasurer are not deemed to satisfy the “best efforts” described in 11 C.F.R. 

§ 111.35, CVFC submit that such regulation is arbitrary, capricious, unreasonably 

9 Most committees are small operations, including many where the only person in 

the committee is the treasurer. The treasurer is the committee and vice-versa. If 

such committees filed late reports due to recklessness or wilfulness, and any fine 

were imposed on only the committee and treasurer “in their official capacities,” 

those fines could easily be avoided by the committee going defunct, with the 

treasurer paying him or herself additional compensation, or contributing the 

committee’s funds to other committees, thereby leaving the committee judgment 

proof or terminated, with no individual personally accountable.

57

 

USCA Case #13-5358 Document #1508094 Filed: 08/18/2014 Page 63 of 135
narrow, contrary to law, on its face and as applied. See U.S. Chamber of 

Commerce v. Securities and Exchange Commission, 412 F.3d 133 (D.C. Cir. 

2005); Public Citizen v. Federal Motor Carrier Safety Administration, 374 F.3d 

1209 (D.C. Cir. 2004); 5 U.S.C. § 706(2)(A), (2)(D).

CONCLUSION

For the foregoing reasons, the judgment below should be reversed.

Respectfully submitted,

____/s/______________________

Dan Backer

DB Capital Strategies PLLC

203 South Union Street, Suite 300

Alexandria, VA 22314

(202) 210-5431

dbacker@dbcapitolstrategies.com

Paul D. Kamenar

Coolidge Reagan Foundation

1612 K Street, N.W., Suite 300

Washington, DC 20006

(202) 603-5397

Paul.kamenar@gmail.com

Counsel for Appellants

Date: August 18, 2014

58

USCA Case #13-5358 Document #1508094 Filed: 08/18/2014 Page 64 of 135
CERTIFICATE OF COMPLIANCE

1. This brief complies with the type-volume limitation of Fed. R. App. P. 

28.1(e)(2) or 32(a)(7)(B) because: 

[ X ] this brief contains [13,754] words, excluding the parts of the brief 

exempted by Fed. R. App. P. 32(a)(7)(B)(iii), or 

[ ] this brief uses a monospaced typeface and contains [state the number 

of] lines of text, excluding the parts of the brief exempted by Fed. R. App. P. 

32(a)(7)(B)(iii). 

2. This brief complies with the typeface requirements of Fed. R. App. P. 

32(a)(5) and the type style requirements of Fed. R. App. P. 32(a)(6) because: 

[ X ] this brief has been prepared in a proportionally spaced typeface using 

[Microsoft Word 20013] in [14pt Times New Roman]; or 

[ ] this brief has been prepared in a monospaced typeface using [state 

name and version of word processing program] with [state number of 

characters per inch and name of type style]. 

Dated: August 18, 2014 /s/ Dan Backer

Counsel for Appellants

USCA Case #13-5358 Document #1508094 Filed: 08/18/2014 Page 65 of 135
A D D E N D U M

USCA Case #13-5358 Document #1508094 Filed: 08/18/2014 Page 66 of 135
ADDENDUM TABLE OF CONTENTS

Page

2 U.S.C. § 432(a) ..............................................................................................Add. 1

2 U.S.C. § 432(c) ..............................................................................................Add. 1

2 U.S.C. § 432(d)..............................................................................................Add. 1

2 U.S.C. § 434(a) ..............................................................................................Add. 2

2 U.S.C. § 437c .................................................................................................Add. 3

2 U.S.C. § 437d.................................................................................................Add. 6

2 U.S.C. § 437g.................................................................................................Add. 8

2 U.S.C. § 437h...............................................................................................Add. 13

5 U.S.C. § 552b...............................................................................................Add. 14

5 U.S.C. § 704.................................................................................................Add. 19

5 U.S.C. § 706.................................................................................................Add. 19

11 C.F.R. Part 2—Sunshine Regulations; Meetings.......................................Add. 20

11 C.F.R. § 104.1 ............................................................................................Add. 25

11 C.F.R. § 104.14(d) .....................................................................................Add. 27

11 C.F.R. Part 111 Subpart A—Enforcement ...............................................Add. 28

11 C.F.R. § 111.8 ............................................................................................Add. 30

11 C.F.R. § 111.9 ............................................................................................Add. 30

11 C.F.R. Part 111 Subpart B—Administrative Fines....................................Add. 35

Add. i

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11 C.F.R. § 111.32 ..........................................................................................Add. 35

11 C.F.R. § 111.35 ..........................................................................................Add. 36

11 C.F.R. § 111.37 ..........................................................................................Add. 37

11 C.F.R. § 111.43 ..........................................................................................Add. 38

11 C.F.R. § 114.12 ..........................................................................................Add. 42

69 Fed. Reg. 4092 ...........................................................................................Add. 43

70 Fed. Reg. 1 .................................................................................................Add. 47

Federal Election Commission Directive No. 10 .............................................Add. 52

Federal Election Commission Directive No. 52 .............................................Add. 59

FEC.gov Website Screenshots........................................................................Add. 64

Add. ii

USCA Case #13-5358 Document #1508094 Filed: 08/18/2014 Page 68 of 135
United States Code 

Title 2

* * * 

§ 432. Organization of political committees 

(a) Treasurer: vacancy; official authorizations. Every political committee shall have a 

treasurer. No contribution or expenditure shall be accepted or made by or on behalf of a political 

committee during any period in which the office of treasurer is vacant. No expenditure shall be 

made for or on behalf of a political committee without the authorization of the treasurer or his or 

her designated agent. 

* * * 

(c) Recordkeeping. The treasurer of a political committee shall keep an account of— 

(1) all contributions received by or on behalf of such political committee; 

(2) the name and address of any person who makes any contribution in excess of $50, 

together with the date and amount of such contribution by any person; 

(3) the identification of any person who makes a contribution or contributions 

aggregating more than $200 during a calendar year, together with the date and amount of any 

such contribution; 

(4) the identification of any political committee which makes a contribution, together 

with the date and amount of any such contribution; and 

(5) the name and address of every person to whom any disbursement is made, the date, 

amount, and purpose of the disbursement, and the name of the candidate and the office 

sought by the candidate, if any, for whom the disbursement was made, including a receipt, 

invoice, or cancelled check for each disbursement in excess of $200. 

(d) Preservation of records and copies of reports. The treasurer shall preserve all records 

required to be kept by this section and copies of all reports required to be filed by this subchapter 

for 3 years after the report is filed. For any report filed in electronic format under section 

434(a)(11) of this title, the treasurer shall retain a machine-readable copy of the report as the 

copy preserved under the preceding sentence. 

* * * 

Add. 1

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§ 434. Reporting requirements 

(a) Receipts and disbursements by treasurers of political committees; filing requirements. 

(1) Each treasurer of a political committee shall file reports of receipts and 

disbursements in accordance with the provisions of this subsection. The treasurer shall sign 

each such report. 

(2) If the political committee is the principal campaign committee of a candidate for the 

House of Representatives or for the Senate— 

 (A) in any calendar year during which there is a regularly scheduled election for 

which such candidate is seeking election, or nomination for election, the treasurer shall file 

the following reports: 

* * * 

 (3) If the committee is the principal campaign committee of a candidate for the office of 

President— 

 (A) in any calendar year during which a general election is held to fill such office— 

 (i) the treasurer shall file monthly reports * * * 

* * * 

 (4) All political committees other than authorized committees of a candidate shall file 

either— 

 (A) (i) quarterly reports * * * 

* * * 

 (iv) * * * or 

 (B) monthly reports * * * 

* * * 

Add. 2

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§ 437c. Federal Election Commission 

(a) Establishment; membership; term of office; vacancies; qualifications; compensation; 

chairman and vice chairman. 

(1) There is established a commission to be known as the Federal Election Commission. 

The Commission is composed of the Secretary of the Senate and the Clerk of the House of 

Representatives or their designees, ex officio and without the right to vote, and 6 members 

appointed by the President, by and with the advice and consent of the Senate.1 No more than 

3 members of the Commission appointed under this paragraph may be affiliated with the 

same political party. 

(2) 

(A) Members of the Commission shall serve for a single term of 6 years,2 except that 

of the members first appointed— 

(i) two of the members, not affiliated with the same political party, shall be 

appointed for terms ending on April 30, 1977; 

(ii) two of the members, not affiliated with the same political party, shall be 

appointed for terms ending on April 30, 1979; and 

(iii) two of the members, not affiliated with the same political party, shall be 

appointed for terms ending on April 30, 1981. 

(B) A member of the Commission may serve on the Commission after the expiration 

of his or her term until his or her successor has taken office as a member of the 

Commission. 

(C) An individual appointed to fill a vacancy occurring other than by the expiration 

of a term of office shall be appointed only for the unexpired term of the member he or she 

succeeds. 

(D) Any vacancy occurring in the membership of the Commission shall be filled in 

the same manner as in the case of the original appointment. 

(3) Members shall be chosen on the basis of their experience, integrity, impartiality, and 

good judgment and members (other than the Secretary of the Senate and the Clerk of the 

House of Representatives) shall be individuals who, at the time appointed to the 

Commission, are not elected or appointed officers or employees in the executive, legislative, 

or judicial branch of the Federal Government. Such members of the Commission shall not 

engage in any other business, vocation, or employment. Any individual who is engaging in 

any other business, vocation, or employment at the time of his or her appointment to the 

Commission shall terminate or liquidate such activity no later than 90 days after such 

appointment. 

 

1

 The U.S. Court of Appeals for the District of Columbia found the ex officio membership of the Secretary of the 

Senate and the Clerk of the House on the Federal Election Commission to be unconstitutional, a holding left intact 

when the Supreme Court subsequently decided that it should not have agreed to hear the Commission’s appeal. FEC 

v. NRA Political Victory Fund, 6 F.3d 821 (D.C. Cir. 1993), cert. dismissed for want of jurisdiction, 513 U.S. 88 

(1994). Therefore these ex officio members no longer serve on the Commission. 

2

 This term limit applies to individuals nominated by the President to be members of the Federal Election 

Commission after December 31, 1997, unless the President announced his intent to nominate the individual prior to 

November 30, 1997. Pub. L. No. 105–61, § 512, 111 Stat. 1272, 1305 (1997), Pub. L. No. 105-119, § 631, 111 Stat. 

2440, 2522 (1997). 

Add. 3

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(4) Members of the Commission (other than the Secretary of the Senate and the Clerk of 

the House of Representatives) shall receive compensation equivalent to the compensation 

paid at level IV of the Executive Schedule (5 U.S.C. § 5315). 

(5) The Commission shall elect a chairman and a vice chairman from among its 

members (other than the Secretary of the Senate and the Clerk of the House of 

Representatives) for a term of one year. A member may serve as chairman only once during 

any term of office to which such member is appointed. The chairman and the vice chairman 

shall not be affiliated with the same political party. The vice chairman shall act as chairman 

in the absence or disability of the chairman or in the event of a vacancy in such office. 

(b) Administration, enforcement, and formulation of policy; exclusive jurisdiction of 

civil enforcement; Congressional authorities or functions with respect to elections for 

Federal office. 

(1) The Commission shall administer, seek to obtain compliance with, and formulate 

policy with respect to, this Act and chapter 95 and chapter 96 of title 26. The 

Commission shall have exclusive jurisdiction with respect to the civil enforcement of 

such provisions. 

(2) Nothing in this Act shall be construed to limit, restrict, or diminish any 

investigatory, informational, oversight, supervisory, or disciplinary authority or function 

of the Congress or any committee of the Congress with respect to elections for Federal 

office. 

(c) Voting requirements; delegation of authorities. All decisions of the Commission 

with respect to the exercise of its duties and powers under the provisions of this Act shall be 

made by a majority vote of the members of the Commission. A member of the Commission 

may not delegate to any person his or her vote or any decision making authority or duty 

vested in the Commission by the provisions of this Act, except that the affirmative vote of 4 

members of the Commission shall be required in order for the Commission to take any action 

in accordance with paragraph (6), (7), (8), or (9) of section 437d(a) of this title or with 

chapter 95 or chapter 96 of title 26. 

(d) Meetings. The Commission shall meet at least once each month and also at the call 

of any member. 

(e) Rules for conduct of activities; judicial notice of seal; principal office. The 

Commission shall prepare written rules for the con duct of its activities, shall have an official 

seal which shall be judicially noticed, and shall have its principal office in or near the District 

of Columbia (but it may meet or exercise any of its powers anywhere in the United States). 

(f) Staff director and general counsel; appointment and compensation; appointment and 

compensation of personnel and procurement of intermittent services by staff director; use of 

assistance, personnel, and facilities of Federal agencies and departments; counsel for defense 

of actions. 

(1) The Commission shall have a staff director and a general counsel who shall be 

appointed by the Commission. The staff director shall be paid at a rate not to exceed the rate 

of basic pay in effect for level IV of the Executive Schedule (5 U.S.C. 5315). The general 

counsel shall be paid at a rate not to exceed the rate of basic pay in effect for level V of the 

Executive Schedule (5 U.S.C. 5316). With the approval of the Commission, the staff director 

may appoint and fix the pay of such additional personnel as he or she considers desirable 

Add. 4

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without regard to the provisions of title 5, United States Code, governing appointments in the 

competitive service. 

(2) With the approval of the Commission, the staff director may procure temporary and 

intermittent services to the same extent as is authorized by section 3109(b) of title 5, United 

States Code, but at rates for individuals not to exceed the daily equivalent of the annual rate 

of basic pay in effect for grade GS–15 of the General Schedule (5 U.S.C. § 5332). 

(3) In carrying out its responsibilities under this Act, the Commission shall, to the fullest 

extent practicable, avail itself of the assistance, including personnel and facilities of other 

agencies and departments of the United States. The heads of such agencies and departments 

may make available to the Commission such personnel, facilities, and other assistance, with 

or without reimbursement, as the Commission may request. 

(4) Notwithstanding the provisions of paragraph (2), the Commission is authorized to 

appear in and defend against any action instituted under this Act, either— 

(A) by attorneys employed in its office, or 

(B) by counsel whom it may appoint, on a temporary basis as may be necessary for 

such purpose, without regard to the provisions of title 5, United States Code, 

governing appointments in the competitive service, and whose compensation it may 

fix without regard to the provisions of chapter 51 and subchapter III of chapter 53 of 

such title. The compensation of counsel so appointed on a temporary basis shall be 

paid out of any funds otherwise available to pay the compensation of employees of 

the Commission. 

Add. 5

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§ 437d. Powers of the Commission 

(a) Specific authorities. The Commission has the power— 

(1) to require by special or general orders, any person to submit, under oath, such 

written reports and answers to questions as the Commission may prescribe; 

(2) to administer oaths or affirmations; 

(3) to require by subpoena, signed by the chairman or the vice chairman, the attendance 

and testimony of witnesses and the production of all documentary evidence relating to the 

execution of its duties; 

(4) in any proceeding or investigation, to order testimony to be taken by deposition 

before any person who is designated by the Commission and has the power to administer 

oaths and, in such instances, to compel testimony and the production of evidence in the same 

manner as authorized under paragraph (3); 

(5) to pay witnesses the same fees and mileage as are paid in like circumstances in the 

courts of the United States; 

(6) to initiate (through civil actions for injunctive, declaratory, or other appropriate 

relief), defend (in the case of any civil action brought under section 437g(a)(8) of this title) or 

appeal any civil action in the name of the Commission to enforce the provisions of this Act 

and chapter 95 and chapter 96 of title 26, through its general counsel; 

(7) to render advisory opinions under section 437f of this title; 

(8) to develop such prescribed forms and to make, amend, and repeal such rules, 

pursuant to the provisions of chapter 5 of title 5, United States Code, as are necessary to 

carry out the provisions of this Act and chapter 95 and chapter 96 of title 26; and 

(9) to conduct investigations and hearings expeditiously, to encourage voluntary 

compliance, and to report apparent violations to the appropriate law enforcement authorities. 

(b) Judicial orders for compliance with subpoenas and orders of Commission; contempt of 

court. Upon petition by the Commission, any United States district court within the jurisdiction 

of which any inquiry is being carried on may, in case of refusal to obey a subpoena or order of 

the Commission issued under subsection (a) of this section, issue an order requiring compliance. 

Any failure to obey the order of the court may be punished by the court as a contempt there of. 

(c) Civil liability for disclosure of information. No person shall be subject to civil liability to 

any person (other than the Commission or the United States) for disclosing information at the 

request of the Commission. 

(d) Concurrent transmissions to Congress or member of budget estimates, etc.; prior 

submission of legislative recommendations, testimony, or comments on legislation.

3

(1) Whenever the Commission submits any budget estimate or request to the President 

or the Office of Management and Budget, it shall concurrently transmit a copy of such 

estimate or request to the Congress. 

(2) Whenever the Commission submits any legislative recommendation, or testimony, 

or comments on legislation, re quested by the Congress or by any Member of the Congress, 

to the President or the Office of Management and Budget, it shall concurrently transmit a 

copy thereof to the Congress or to the Member requesting the same. No officer or agency of 

the United States shall have any authority to require the Commission to submit its legislative 

 

3

 These reports are no longer required. See House Document No. 103-7, cited in Note, 31 U.S.C. § 1113 and Pub. L. 

No. 104-66. 

Add. 6

USCA Case #13-5358 Document #1508094 Filed: 08/18/2014 Page 74 of 135
recommendations, testimony, or comments on legislation, to any office or agency of the 

United States for approval, comments, or review, prior to the submission of such 

recommendations, testimony, or comments to the Congress. 

(e) Exclusive civil remedy for enforcement. Except as provided in section 437g(a)(8) of this 

title, the power of the Commission to initiate civil actions under subsection (a)(6) of this section 

shall be the exclusive civil remedy for the enforcement of the provisions of this Act. 

* * * 

Add. 7

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§ 437g. Enforcement 

(a) Administrative and judicial practice and procedure.

4

(1) Any person who believes a violation of this Act or of chapter 95 or chapter 96 of 

title 26 has occurred, may file a complaint with the Commission. Such complaint shall be in 

writing, signed and sworn to by the person filing such com plaint, shall be notarized, and 

shall be made under penalty of perjury and subject to the provisions of section 1001 of title 

18. Within 5 days after receipt of a complaint, the Commission shall notify, in writing, any 

person alleged in the complaint to have committed such a violation. Before the Commission 

conducts any vote on the complaint, other than a vote to dismiss, any person so notified shall 

have the opportunity to demonstrate, in writing, to the Commission within 15 days after 

notification that no action should be taken against such person on the basis of the complaint. 

The Commission may not conduct any investigation or take any other action under this 

section solely on the basis of a complaint of a person whose identity is not disclosed to the 

Commission. 

(2) If the Commission, upon receiving a complaint under paragraph (1) or on the basis 

of information ascertained in the normal course of carrying out its supervisory 

responsibilities, determines, by an affirmative vote of 4 of its members, that it has reason to 

believe that a person has committed, or is about to commit, a violation of this Act or chapter 

95 or chapter 96 of title 26, the Commission shall, through its chairman or vice chairman, 

notify the person of the alleged violation. Such notification shall set forth the factual basis for 

such alleged violation. The Commission shall make an investigation of such alleged 

violation, which may include a field investigation or audit, in accordance with the provisions 

of this section. 

(3) The general counsel of the Commission shall notify the respondent of any 

recommendation to the Commission by the general counsel to proceed to a vote on probable 

cause pursuant to paragraph (4)(A)(i). With such notification, the general counsel shall 

include a brief stating the position of the general counsel on the legal and factual issues of the 

case. Within 15 days of receipt of such brief, respondent may submit a brief stating the 

position of such respondent on the legal and factual issues of the case, and replying to the 

brief of general counsel. Such briefs shall be filed with the Secretary of the Commission and 

shall be considered by the Commission before proceeding under paragraph (4). 

(4) 

(A) 

(i) Except as provided in clauses (ii) and subparagraph (C),5 if the Commission 

determines, by an affirmative vote of 4 of its members, that there is probable cause to 

 

4

 The Debt Collection Improvement Act, adopted in 1996, amended the Federal Civil Penalties Inflation Adjustment 

Act to require that the FEC and other executive agencies adjust the top amount of their current civil penalties. The 

general provisions at 2 U.S.C. § 437g(a)(5) and (6) now call for a maximum penalty of the greater of the amount of 

any contribution or expenditure involved in the violation or $5,500. The maximum penalty for knowing and willful 

violations increased to $11,000. Civil penalties assessed for violating the Act’s confidentiality provisions at 2 U.S.C. 

§ 437g(a)(12) increased to $2,200 and, for knowing and willful violations, to $5,500. These increases apply only to 

violations that occurred after April 29, 1997. See 62 FR 11316 and 62 FR 32021.

5

 Section 640 of the Treasury and General Government Appropriations Act, 2000, Pub. L. No. 106-58, amended 2 

U.S.C. § 437g(a)(4) by adding subparagraph (C) plus conforming amendments at sections 437g(a)(4)(A)(i) and 

(a)(6)(A). These amendments applied with respect to violations occurring between January 1, 2000, and December 

31, 2001. Section 642 of the Fiscal Year 2002 Treasury and General Government Appropriations Act, Pub. L. No. 

Add. 8

USCA Case #13-5358 Document #1508094 Filed: 08/18/2014 Page 76 of 135
believe that any person has committed, or is about to commit, a violation of this Act 

or of chapter 95 or chapter 96 of title 26, the Commission shall attempt, for a period 

of at least 30 days, to correct or prevent such violation by informal methods of 

conference, conciliation, and persuasion, and to enter into a conciliation agreement 

with any person involved. Such attempt by the Commission to correct or prevent such 

violation may continue for a period of not more than 90 days. The Commission may 

not enter into a conciliation agreement under this clause except pursuant to an 

affirmative vote of 4 of its members. A conciliation agreement, unless violated, is a 

complete bar to any further action by the Commission, including the bringing of a 

civil proceeding under paragraph (6)(A). 

(ii) If any determination of the Commission under clause (i) occurs during the 

45-day period immediately preceding any election, then the Commission shall 

attempt, for a period of at least 15 days, to correct or prevent the violation involved 

by the methods specified in clause (i). 

(B) 

(i) No action by the Commission or any person, and no information derived, in 

connection with any conciliation attempt by the Commission under subparagraph (A) 

may be made public by the Commission without the written consent of the respondent 

and the Commission. 

(ii) If a conciliation agreement is agreed upon by the Commission and the 

respondent, the Commission shall make public any conciliation agreement signed by 

both the Commission and the respondent. If the Commission makes a determination 

that a person has not violated this Act or chapter 95 or chapter 96 of title 26, the 

Commission shall make public such determination. 

(C) 

(i) Notwithstanding subparagraph (A), in the case of a violation of any 

requirement of section 304(a) of the Act (2 U.S.C. § 434(a)), the Commission may— 

(I) find that a person committed such a violation on the basis of information 

obtained pursuant to the procedures described in paragraphs (1) and (2); and 

(II) based on such finding, require the person to pay a civil money penalty in 

an amount determined under a schedule of penalties which is established and 

published by the Commission and which takes into account the amount of the 

violation involved, the existence of previous violations by the person, and such 

other factors as the Commission considers appropriate. 

(ii) The Commission may not make any determination adverse to a person under 

clause (i) until the person has been given written notice and an opportunity to be 

heard before the Commission. 

(iii) Any person against whom an adverse determination is made under this 

subparagraph may obtain a review of such determination in the district court of the 

United States for the district in which the person resides, or transacts business, by 

 

107-67, extended the effective date to cover violations that relate to reporting periods through December 31, 2003. 

Section 639 of the Consolidated Appropriations Act, 2004, Pub. L. No. 108-199, further extended the effective date 

to cover violations that relate to reporting periods through December 31, 2005. See 69 FR 6525 (February 11, 2004) 

for more information. Section 721 of the Transportation, Treasury, Housing and Urban Development, Judiciary, 

District of Columbia and Independent Agencies Appropriations Act, 2006, Pub. L. No. 109-115, further extended 

the effective date to cover violations that relate to reporting periods through December 31, 2008. See 70 Fed. Reg. 

75717 (December 21, 2005) for more information. 

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USCA Case #13-5358 Document #1508094 Filed: 08/18/2014 Page 77 of 135
filing in such court (prior to the expiration of the 30-day period which begins on the 

date the person receives notification of the determination) a written petition 

requesting that the determination be modified or set aside. 

(5) 

(A) If the Commission believes that a violation of this Act or of chapter 95 or 

chapter 96 of title 26 has been committed, a conciliation agreement entered into by the 

Commission under paragraph (4)(A) may include a requirement that the person involved 

in such conciliation agreement shall pay a civil penalty which does not exceed the greater 

of $5,000 or an amount equal to any contribution or expenditure involved in such 

violation. 

(B) If the Commission believes that a knowing and willful violation of this Act or of 

chapter 95 or chapter 96 of title 26 has been committed, a conciliation agreement entered 

into by the Commission under paragraph (4)(A) may require that the person involved in 

such conciliation agreement shall pay a civil penalty which does not exceed the greater of 

$10,000 or an amount equal to 200 percent of any contribution or expenditure involved in 

such violation (or in the case of a violation of section 320 (2 U.S.C. § 441f), which is not 

less than 300 percent of the amount involved in the violation and is not more than the 

greater of $50,000 or 1000 percent of the amount involved in the violation).6

(C) If the Commission by an affirmative vote of 4 of its members, determines that 

there is probable cause to believe that a knowing and willful violation of this Act which is 

subject to subsection (d) of this section, or a knowing and willful violation of chapter 95 

or chapter 96 of title 26, has occurred or is about to occur, it may refer such apparent 

violation to the Attorney General of the United States without regard to any limitations 

set forth in paragraph (4)(A). 

(D) In any case in which a person has entered into a conciliation agreement with the 

Commission under paragraph (4)(A), the Commission may institute a civil action for 

relief under paragraph (6)(A) if it believes that the person has violated any provision of 

such conciliation agreement. For the Commission to obtain relief in any civil action, the 

Commission need only establish that the person has violated, in whole or in part, any 

requirement of such conciliation agreement. 

(6) 

(A) If the Commission is unable to correct or prevent any violation of this Act or of 

chapter 95 or chapter 96 of title 26, by the methods specified in paragraph (4), the 

Commission may, upon an affirmative vote of 4 of its members, institute a civil action for 

relief, including a permanent or temporary injunction, restraining order, or any other 

appropriate order (including an order for a civil penalty which does not exceed the greater 

of $5,000 or an amount equal to any contribution or expenditure involved in such 

violation) in the district court of the United States for the district in which the person 

against whom such action is brought is found, resides, or transacts business. 

(B) In any civil action instituted by the Commission under subparagraph (A), the 

court may grant a permanent or temporary injunction, restraining order, or other order, 

including a civil penalty which does not exceed the greater of $5,000 or an amount equal 

to any contribution or expenditure involved in such violation, upon a proper showing that 

 

6

 Section 315(a) of the Bipartisan Campaign Reform Act of 2002 (BCRA), Pub. L. No. 107-155, inserted new 

language in sections 437g(a)(5)(B) and (6)(C). This amendment is effective for violations occurring on or after 

November 6, 2002. 

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the person involved has committed, or is about to commit (if the relief sought is a 

permanent or temporary injunction or a restraining order), a violation of this Act or 

chapter 95 or chapter 96 of title 26. 

(C) In any civil action for relief instituted by the Commission under subparagraph 

(A), if the court deter mines that the Commission has established that the person involved 

in such civil action has committed a knowing and willful violation of this Act or of 

chapter 95 or chapter 96 of title 26, the court may impose a civil penalty which does not 

exceed the greater of $10,000 or an amount equal to 200 percent of any contribution or 

expenditure involved in such violation (or in the case of a violation of section 320 (2 

U.S.C. § 441f), which is not less than 300 percent of the amount involved in the violation 

and is not more than the greater of $50,000 or 1000 percent of the amount involved in the 

violation. 

(7) In any action brought under paragraph (5) or (6), subpoenas for witnesses who are 

required to attend a United States district court may run into any other district. 

(8) 

(A) Any party aggrieved by an order of the Commission dismissing a complaint 

filed by such party under para graph (1), or by a failure of the Commission to act on such 

complaint during the 120-day period beginning on the date the complaint is filed, may 

file a petition with the United States District Court for the District of Columbia. 

(B) Any petition under subparagraph (A) shall be filed, in the case of a dismissal of 

a complaint by the Commission, within 60 days after the date of the dismissal. 

(C) In any proceeding under this paragraph the court may declare that the dismissal 

of the complaint or the failure to act is contrary to law, and may direct the Commission to 

conform with such declaration within 30 days, failing which the complainant may bring, 

in the name of such complainant, a civil action to remedy the violation involved in the 

original complaint. 

(9) Any judgment of a district court under this subsection may be appealed to the court 

of appeals, and the judgment of the court of appeals affirming or setting aside, in whole or in 

part, any such order of the district court shall be final, subject to review by the Supreme 

Court of the United States upon certiorari or certification as provided in section 1254 of title 

28. 

(10) Repealed. 

(11) If the Commission determines after an investigation that any person has violated an 

order of the court entered in a proceeding brought under paragraph (6), it may petition the 

court for an order to hold such person in civil contempt, but if it believes the violation to be 

knowing and willful it may petition the court for an order to hold such person in criminal 

contempt. 

(12) 

(A) Any notification or investigation made under this section shall not be made 

public by the Commission or by any person without the written consent of the person 

receiving such notification or the person with respect to whom such investigation is 

made. 

(B) Any member or employee of the Commission, or any other person, who violates 

the provisions of sub paragraph (A) shall be fined not more than $2,000. Any such 

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member, employee, or other person who knowingly and willfully violates the provisions 

of subparagraph (A) shall be fined not more than $5,000. 

(b) Notice to persons not filing required reports prior to institution of enforcement action; 

publication of identity of persons and unfiled reports. Before taking any action under subsection 

(a) of this section against any person who has failed to file a report required under section 

434(a)(2)(A)(iii) of this title for the calendar quarter immediately preceding the election 

involved, or in accordance with section 434(a)(2)(A)(i) of this title, the Commission shall notify 

the person of such failure to file the required reports. If a satisfactory response is not received 

within 4 business days after the date of notification, the Commission shall, pursuant to section 

438(a)(7) of this title, publish before the election the name of the person and the report or reports 

such person has failed to file. 

(c) Reports by Attorney General of apparent violations. Whenever the Commission refers an 

apparent violation to the Attorney General, the Attorney General shall report to the Commission 

any action taken by the Attorney General regarding the apparent violation. Each report shall be 

transmitted within 60 days after the date the Commission refers an apparent violation, and every 

30 days thereafter until the final disposition of the apparent violation. 

(d) Penalties; defenses; mitigation of offenses. 

(1) 

(A) Any person who knowingly and willfully commits a violation of any provision of 

this Act which involves the making, receiving, or reporting of any contribution, donation or 

expenditure— 

(i) aggregating $25,000 or more during a calendar year shall be fined under title 18, 

United States Code, or imprisoned for not more than 5 years, or both; or 

(ii) aggregating $2,000 or more (but less than $25,000) during a calendar year shall 

be fined under such title, or imprisoned for not more than one year, or both.7

(B) In the case of a knowing and willful violation of section 441b(b)(3) of this title, the 

penalties set forth in this subsection shall apply to a violation involving an amount 

aggregating $250 or more during a calendar year. Such violation of section 441b(b)(3) of this 

title may incorporate a violation of section 441c(b), 441f, and 441g of this title. 

(C) In the case of a knowing and willful violation of section 441h of this title, the 

penalties set forth in this sub section shall apply without regard to whether the making, 

receiving, or reporting of a contribution or expenditure of $1,000 or more is involved. 

(D)8 Any person who knowingly and willfully commits a violation of section 320 (2 

U.S.C. § 441f) involving an amount aggregating more than $10,000 during a calendar year 

shall be— 

(i) imprisoned for not more than 2 years if the amount is less than $25,000 (and 

subject to imprisonment under subparagraph (A) if the amount is $25,000 or more); 

(ii) fined not less than 300 percent of the amount involved in the violation and not 

more than the greater of— 

 

7

 Section 312(a) of the Bipartisan Campaign Reform Act of 2002 (BCRA), Pub. L. No. 107-155, amended section 

437g(d)(1) to strike language in subparagraph (A) and insert subparagraphs (A)(i) and (ii). This amendment is 

effective for violations occurring on or after November 6, 2002. 

8

 Section 315(b) of the Bipartisan Campaign Reform Act of 2002 (BCRA), Pub. L. No. 107-155, amended section 

437g(d)(1) to add new subparagraph (D). This amendment is effective for violations occurring on or after November 

6, 2002. 

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(I) $50,000; or 

(II) 1,000 percent of the amount involved in the violation; or 

(iii) both imprisoned under clause (i) and fined under clause (ii). 

(2) In any criminal action brought for a violation of any provision of this Act or of chapter 

95 or chapter 96 of this title 26, any defendant may evidence their lack of knowledge or intent to 

commit the alleged violation by introducing as evidence a conciliation agreement entered into 

between the defendant and the Commission under subsection (a)(4)(A) of this section which 

specifically deals with the act or failure to act constituting such violation and which is still in 

effect. 

(3) In any criminal action brought for a violation of any provision of this Act or of chapter 

95 or chapter 96 of title 26, the court before which such action is brought shall take into account, 

in weighing the seriousness of the violation and in considering the appropriateness of the penalty 

to be imposed if the defendant is found guilty, whether— 

(A) the specific act or failure to act which constitutes the violation for which the action 

was brought is the subject of a conciliation agreement entered into between the defendant and 

the Commission under subparagraph (a)(4)(A); 

(B) the conciliation agreement is in effect; and 

(C) the defendant is, with respect to the violation involved, in compliance with the 

conciliation agreement. 

§ 437h. Judicial review9

The Commission, the national committee of any political party, or any individual eligible to vote 

in any election for the office of President may institute such actions in the appropriate district 

court of the United States, including actions for declaratory judgment, as may be appropriate to 

construe the constitutionality of any provision of this Act. The district court immediately shall 

certify all questions of constitutionality of this Act to the United States court of appeals for the 

circuit involved, which shall hear the matter sitting en banc. 

* * * 

 

9

 Section 403 of the Bipartisan Campaign Reform Act of 2002 (BCRA), Pub. L. No. 107-155, provided special 

rules for actions challenging the constitutionality of that Act’s provisions. See Note, 2 U.S.C. § 437h for more 

information. 

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Title 5 

* * * 

§ 552b. Open meetings 

(a) For purposes of this section— 

(1) the term ‘‘agency’’ means any agency, as defined in section 552(e)10 of this title, 

headed by a collegial body composed of two or more individual members, a majority of 

whom are appointed to such position by the President with the advice and consent of the 

Senate, and any subdivision thereof authorized to act on behalf of the agency; 

(2) the term ‘‘meeting’’ means the deliberations of at least the number of individual 

agency members required to take action on behalf of the agency where such deliberations 

determine or result in the joint conduct or disposition of official agency business, but does 

not include deliberations required or permitted by subsection (d) or (e); and 

(3) the term ‘‘member’’ means an individual who belongs to a collegial body heading an 

agency. 

(b) Members shall not jointly conduct or dispose of agency business other than in 

accordance with this section. Except as provided in subsection (c), every portion of every 

meeting of an agency shall be open to public observation. 

(c) Except in a case where the agency finds that the public interest requires otherwise, the 

second sentence of subsection (b) shall not apply to any portion of an agency meeting, and the 

requirements of subsections (d) and (e) shall not apply to any information pertaining to such 

meeting otherwise required by this section to be disclosed to the public, where the agency 

properly determines that such portion or portions of its meeting or the disclosure of such 

information is likely to— 

(1) disclose matters that are (A) specifically authorized under criteria established by an 

Executive order to be kept secret in the interests of national defense or foreign policy and (B) 

in fact properly classified pursuant to such Executive order; 

(2) relate solely to the internal personnel rules and practices of an agency; 

(3) disclose matters specifically exempted from disclosure by statute (other than section 

552 of this title), provided that such statute (A) requires that the matters be withheld from the 

public in such a manner as to leave no discretion on the issue, or (B) establishes particular 

criteria for withholding or refers to particular types of matters to be withheld; 

(4) disclose trade secrets and commercial or financial information obtained from a 

person and privileged or confidential; 

(5) involve accusing any person of a crime, or formally censuring any person; 

(6) disclose information of a personal nature where disclosure would constitute a clearly 

unwarranted invasion of personal privacy; 

(7) disclose investigatory records compiled for law enforcement purposes, or 

information which if written would be contained in such records, but only to the extent that 

the production of such records or information would (A) interfere with enforcement 

proceedings, (B) deprive a person of a right to a fair trial or an impartial adjudication, (C) 

 

10 See References in Text note below. 

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constitute an unwarranted invasion of personal privacy, (D) disclose the identity of a 

confidential source and, in the case of a record compiled by a criminal law enforcement 

authority in the course of a criminal investigation, or by an agency conducting a lawful 

national security intelligence investigation, confidential information furnished only by the 

confidential source, (E) disclose investigative techniques and procedures, or (F) endanger the 

life or physical safety of law enforcement personnel; 

(8) disclose information contained in or related to examination, operating, or condition 

reports prepared by, on behalf of, or for the use of an agency responsible for the regulation or 

supervision of financial institutions; 

(9) disclose information the premature disclosure of which would— 

(A) in the case of an agency which regulates currencies, securities, commodities, or 

financial institutions, be likely to (i) lead to significant financial speculation in currencies, 

securities, or commodities, or (ii) significantly endanger the stability of any financial 

institution; or 

(B) in the case of any agency, be likely to significantly frustrate implementation of a 

proposed agency action, except that subparagraph (B) shall not apply in any instance 

where the agency has already disclosed to the public the content or nature of its proposed 

action, or where the agency is required by law to make such disclosure on its own 

initiative prior to taking final agency action on such proposal; or (10) specifically concern 

the agency’s issuance of a subpoena, or the agency’s participation in a civil action or 

proceeding, an action in a foreign court or international tribunal, or an arbitration, or the 

initiation, conduct, or disposition by the agency of a particular case of formal agency 

adjudication pursuant to the procedures in section 554 of this title or otherwise involving 

a determination on the record after opportunity for a hearing. 

(d) 

(1) Action under subsection (c) shall be taken only when a majority of the entire 

membership of the agency (as defined in subsection (a)(1)) votes to take such action. A 

separate vote of the agency members shall be taken with respect to each agency meeting a 

portion or portions of which are proposed to be closed to the public pursuant to subsection 

(c), or with respect to any information which is proposed to be withheld under subsection (c). 

A single vote may be taken with respect to a series of meetings, a portion or portions of 

which are proposed to be closed to the public, or with respect to any information concerning 

such series of meetings, so long as each meeting in such series involves the same particular 

matters and is scheduled to be held no more than thirty days after the initial meeting in such 

series. The vote of each agency member participating in such vote shall be recorded and no 

proxies shall be allowed. 

(2) Whenever any person whose interests may be directly affected by a portion of a 

meeting requests that the agency close such portion to the public for any of the reasons 

referred to in paragraph (5), (6), or (7) of subsection (c), the agency, upon request of any one 

of its members, shall vote by recorded vote whether to close such meeting. 

(3) Within one day of any vote taken pursuant to paragraph (1) or (2), the agency shall 

make publicly available a written copy of such vote reflecting the vote of each member on 

the question. If a portion of a meeting is to be closed to the public, the agency shall, within 

one day of the vote taken pursuant to paragraph (1) or (2) of this subsection, make publicly 

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available a full written explanation of its action closing the portion together with a list of all 

persons expected to attend the meeting and their affiliation. 

(4) Any agency, a majority of whose meetings may properly be closed to the public 

pursuant to paragraph (4), (8), (9)(A), or (10) of subsection (c), or any combination thereof, 

may provide by regulation for the closing of such meetings or portions thereof in the event 

that a majority of the members of the agency votes by recorded vote at the beginning of such 

meeting, or portion thereof, to close the exempt portion or portions of the meeting, and a 

copy of such vote, reflecting the vote of each member on the question, is made available to 

the public. The provisions of paragraphs (1), (2), and (3) of this subsection and subsection (e) 

shall not apply to any portion of a meeting to which such regulations apply: Provided, That 

the agency shall, except to the extent that such information is exempt from disclosure under 

the provisions of subsection (c), provide the public with public announcement of the time, 

place, and subject matter of the meeting and of each portion thereof at the earliest practicable 

time. 

(e) 

(1) In the case of each meeting, the agency shall make public announcement, at least 

one week before the meeting, of the time, place, and subject matter of the meeting, whether it 

is to be open or closed to the public, and the name and phone number of the official 

designated by the agency to respond to requests for information about the meeting. Such 

announcement shall be made unless a majority of the members of the agency determines by a 

recorded vote that agency business requires that such meeting be called at an earlier date, in 

which case the agency shall make public announcement of the time, place, and subject matter 

of such meeting, and whether open or closed to the public, at the earliest practicable time. 

(2) The time or place of a meeting may be changed following the public announcement 

required by paragraph (1) only if the agency publicly announces such change at the earliest 

practicable time. The subject matter of a meeting, or the determination of the agency to open 

or close a meeting, or portion of a meeting, to the public, may be changed following the 

public announcement required by this subsection only if (A) a majority of the entire 

membership of the agency determines by a recorded vote that agency business so requires 

and that no earlier announcement of the change was possible, and (B) the agency publicly 

announces such change and the vote of each member upon such change at the earliest 

practicable time. 

(3) Immediately following each public announcement required by this subsection, notice 

of the time, place, and subject matter of a meeting, whether the meeting is open or closed, 

any change in one of the preceding, and the name and phone number of the official 

designated by the agency to respond to requests for information about the meeting, shall also 

be submitted for publication in the Federal Register. 

(f) 

(1) For every meeting closed pursuant to paragraphs (1) through (10) of subsection (c), 

the General Counsel or chief legal officer of the agency shall publicly certify that, in his or 

her opinion, the meeting may be closed to the public and shall state each relevant exemptive 

provision. A copy of such certification, together with a statement from the presiding officer 

of the meeting setting forth the time and place of the meeting, and the persons present, shall 

be retained by the agency. The agency shall maintain a complete transcript or electronic 

recording adequate to record fully the proceedings of each meeting, or portion of a meeting, 

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closed to the public, except that in the case of a meeting, or portion of a meeting, closed to 

the public pursuant to paragraph (8), (9)(A), or (10) of subsection (c), the agency shall 

maintain either such a transcript or recording, or a set of minutes. Such minutes shall fully 

and clearly describe all matters discussed and shall provide a full and accurate summary of 

any actions taken, and the reasons therefor, including a description of each of the views 

expressed on any item and the record of any rollcall vote (reflecting the vote of each member 

on the question). All documents considered in connection with any action shall be identified 

in such minutes. 

(2) The agency shall make promptly available to the public, in a place easily accessible 

to the public, the transcript, electronic recording, or minutes (as required by paragraph (1)) of 

the discussion of any item on the agenda, or of any item of the testimony of any witness 

received at the meeting, except for such item or items of such discussion or testimony as the 

agency determines to contain information which may be withheld under subsection (c). 

Copies of such transcript, or minutes, or a transcription of such recording disclosing the 

identity of each speaker, shall be furnished to any person at the actual cost of duplication or 

transcription. The agency shall maintain a complete verbatim copy of the transcript, a 

complete copy of the minutes, or a complete electronic recording of each meeting, or portion 

of a meeting, closed to the public, for a period of at least two years after such meeting, or 

until one year after the conclusion of any agency proceeding with respect to which the 

meeting or portion was held, whichever occurs later. 

(g) Each agency subject to the requirements of this section shall, within 180 days after the 

date of enactment of this section, following consultation with the Office of the Chairman of the 

Administrative Conference of the United States and published notice in the Federal Register of at 

least thirty days and opportunity for written comment by any person, promulgate regulations to 

implement the requirements of subsections (b) through (f) of this section. Any person may bring 

a proceeding in the United States District Court for the District of Columbia to require an agency 

to promulgate such regulations if such agency has not promulgated such regulations within the 

time period specified herein. Subject to any limitations of time provided by law, any person may 

bring a proceeding in the United States Court of Appeals for the District of Columbia to set aside 

agency regulations issued pursuant to this subsection that are not in accord with the requirements 

of subsections (b) through (f) of this section and to require the promulgation of regulations that 

are in accord with such subsections. 

(h) 

(1) The district courts of the United States shall have jurisdiction to enforce the 

requirements of subsections (b) through (f) of this section by declaratory judgment, 

injunctive relief, or other relief as may be appropriate. Such actions may be brought by any 

person against an agency prior to, or within sixty days after, the meeting out of which the 

violation of this section arises, except that if public announcement of such meeting is not 

initially provided by the agency in accordance with the requirements of this section, such 

action may be instituted pursuant to this section at any time prior to sixty days after any 

public announcement of such meeting. Such actions may be brought in the district court of 

the United States for the district in which the agency meeting is held or in which the agency 

in question has its headquarters, or in the District Court for the District of Columbia. In such 

actions a defendant shall serve his answer within thirty days after the service of the 

complaint. The burden is on the defendant to sustain his action. In deciding such cases the 

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court may examine in camera any portion of the transcript, electronic recording, or minutes 

of a meeting closed to the public, and may take such additional evidence as it deems 

necessary. The court, having due regard for orderly administration and the public interest, as 

well as the interests of the parties, may grant such equitable relief as it deems appropriate, 

including granting an injunction against future violations of this section or ordering the 

agency to make available to the public such portion of the transcript, recording, or minutes of 

a meeting as is not authorized to be withheld under subsection (c) of this section. 

(2) Any Federal court otherwise authorized by law to review agency action may, at the 

application of any person properly participating in the proceeding pursuant to other 

applicable law, inquire into violations by the agency of the requirements of this section and 

afford such relief as it deems appropriate. Nothing in this section authorizes any Federal 

court having jurisdiction solely on the basis of paragraph (1) to set aside, enjoin, or invalidate 

any agency action (other than an action to close a meeting or to withhold information under 

this section) taken or discussed at any agency meeting out of which the violation of this 

section arose. 

(i) The court may assess against any party reasonable attorney fees and other litigation costs 

reasonably incurred by any other party who substantially prevails in any action brought in 

accordance with the provisions of subsection (g) or (h) of this section, except that costs may be 

assessed against the plaintiff only where the court finds that the suit was initiated by the plaintiff 

primarily for frivolous or dilatory purposes. In the case of assessment of costs against an agency, 

the costs may be assessed by the court against the United States. 

(j) Each agency subject to the requirements of this section shall annually report to the 

Congress regarding the following: 

(1) The changes in the policies and procedures of the agency under this section that have 

occurred during the preceding 1-year period. 

(2) A tabulation of the number of meetings held, the exemptions applied to close 

meetings, and the days of public notice provided to close meetings. 

(3) A brief description of litigation or formal complaints concerning the implementation 

of this section by the agency. 

(4) A brief explanation of any changes in law that have affected the responsibilities of 

the agency under this section. 

(k) Nothing herein expands or limits the present rights of any person under section 552 of 

this title, except that the exemptions set forth in subsection (c) of this section shall govern in the 

case of any request made pursuant to section 552 to copy or inspect the transcripts, recordings, or 

minutes described in subsection (f) of this section. The requirements of chapter 33 of title 44, 

United States Code, shall not apply to the transcripts, recordings, and minutes described in 

subsection (f) of this section. 

(l) This section does not constitute authority to withhold any information from Congress, 

and does not authorize the closing of any agency meeting or portion thereof required by any 

other provision of law to be open. 

(m) Nothing in this section authorizes any agency to withhold from any individual any 

record, including transcripts, recordings, or minutes required by this section, which is otherwise 

accessible to such individual under section 552a of this title. 

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References in Text: 

Section 552(e) of this title, referred to in subsec. (a)(1), was redesignated section 552(f) of 

this title by section 1802(b) of Pub. L. 99–570. 

180 days after the date of enactment of this section, referred to in subsec. (g), means 180 

days after the date of enactment of Pub. L. 94–409, which was approved Sept. 13, 1976. 

* * * 

§ 704. Actions reviewable 

Agency action made reviewable by statute and final agency action for which there is no other 

adequate remedy in a court are subject to judicial review. A preliminary, procedural, or 

intermediate agency action or ruling not directly reviewable is subject to review on the review of 

the final agency action. Except as otherwise expressly required by statute, agency action 

otherwise final is final for the purposes of this section whether or not there has been presented or 

determined an application for a declaratory order, for any form of reconsideration, or, unless the 

agency otherwise requires by rule and provides that the action meanwhile is inoperative, for an 

appeal to superior agency authority. 

* * * 

§ 706. Scope of review

To the extent necessary to decision and when presented, the reviewing court shall decide all 

relevant questions of law, interpret constitutional and statutory provisions, and determine the 

meaning or applicability of the terms of an agency action. The reviewing court shall— 

(1) compel agency action unlawfully withheld or unreasonably delayed; and 

(2) hold unlawful and set aside agency action, findings, and conclusions found to be— 

(A) arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law; 

(B) contrary to constitutional right, power, privilege, or immunity; 

(C) in excess of statutory jurisdiction, authority, or limitations, or short of statutory right; 

(D) without observance of procedure required by law; 

(E) unsupported by substantial evidence in a case subject to sections 556 and 557 of this 

title or otherwise reviewed on the record of an agency hearing provided by statute; or 

(F) unwarranted by the facts to the extent that the facts are subject to trial de novo by the 

reviewing court. 

In making the foregoing determinations, the court shall review the whole record or those parts of 

it cited by a party, and due account shall be taken of the rule of prejudicial error. 

* * * 

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This section of the FEDERAL REGISTER

contains notices to the public of the proposed

issuance of rules and regulations. The

purpose of these notices is to give interested

persons an opportunity to participate in the

rule making prior to the adoption of the final

rules.

Proposed Rules Federal Register

4092

Vol. 69, No. 18

Wednesday, January 28, 2004

1The terms ‘‘official capacity’’ and 

‘‘representative capacity’’ are generally 

interchangeable, as are the terms ‘‘personal 

capacity’’ and ‘‘individual capacity.’’ See McCarthy

v. Azure, 22 F.3d 351, 359 n.12 (1st Cir. 1994).

2As discussed infra Part II.A., the phrases 

‘‘official capacity’’ and ‘‘personal capacity’’ are legal 

terms of art that permeate such fields as sovereign 

immunity, bankruptcy, corporations, and federal 

procedure. Their usage instantaneously identifies 

for the judiciary when the Commission is pursuing 

treasurers by virtue of their position, rather than by 

product of their actions.

FEDERAL ELECTION COMMISSION 

11 CFR Part 111 

[Notice 2004–3] 

Proposed Statement of Policy 

Regarding Naming of Treasurers in 

Enforcement Matters

AGENCY: Federal Election Commission.

ACTION: Draft statement of policy with 

request for comments. 

SUMMARY: The Commission is 

considering exercising its discretion in 

enforcement matters to clarify when it 

intends to name a treasurer of a political 

committee in his or her official capacity 

as treasurer, and when it intends to 

name the treasurer in his or her personal 

capacity. For most enforcement matters 

involving a political committee, the 

Commission may decide, as a matter of 

policy, to name the treasurer in his or 

her official capacity. However, where a 

treasurer has apparently breached a 

personal obligation owing by virtue of 

his or her responsibilities under the Act 

and regulations, or a prohibition that 

applies to individuals, the Commission 

may decide to name that treasurer as a 

respondent in his or her personal 

capacity. The Commission seeks 

comments on the policy under 

consideration, and on how it should 

exercise its prosecutorial discretion on 

this subject in matters arising in its 

Administrative Fines Program.

DATES: Comments must be submitted on 

or before February 27, 2004.

ADDRESSES: All comments should be 

addressed to Peter G. Blumberg, 

Attorney, and must be submitted in 

either electronic or written form. 

Electronic mail comments should be 

sent to treas2004@fec.gov and must 

include the full name, electronic mail 

address and postal service address of 

the commenter. Electronic mail 

comments that do not contain the full 

name, electronic mail address and 

postal service address of the commenter 

will not be considered. If the electronic 

mail comments include an attachment, 

the attachment must be in the Adobe 

Acrobat (.pdf) or Microsoft Word (.doc) 

format. Faxed comments should be sent 

to (202) 219–3923, with printed copy 

follow-up to ensure legibility. Written 

comments and printed copies of faxed 

comments should be sent to the Federal 

Election Commission, 999 E Street, 

NW., Washington, DC 20463. 

Commenters are strongly encouraged to 

submit comments electronically to 

ensure timely receipt and consideration. 

The Commission will make every effort 

to post public comments on its Web site 

within ten business days of the close of 

the comment period.

FOR FURTHER INFORMATION CONTACT:

Peter G. Blumberg, Attorney, 999 E 

Street, NW., Washington, DC 20463, 

(202) 694–1650 or (800) 424–9530.

SUPPLEMENTARY INFORMATION: 

I. Introduction 

The Commission proposes modifying 

its current practice to name more clearly 

treasurers in their ‘‘official’’ and/or 

‘‘personal’’ capacities.1 Specifically, 

when a complaint asserts sufficient 

allegations to warrant naming a 

committee as a respondent, the 

committee’s current treasurer would 

also be named as a respondent in his or 

her official capacity. In these 

circumstances, reason-to-believe and 

probable cause findings against the 

committee would also be made as to the 

current treasurer in his or her official 

capacity. When the complaint asserts 

allegations that involve a past or present 

treasurer’s violation of obligations that 

the Act or regulations impose 

specifically on treasurers, or 

prohibitions that apply to individual 

persons, then that treasurer would be 

named in his or her personal capacity, 

and findings would be made against the 

treasurer in that capacity. Thus, in some 

matters the current treasurer could be 

named in both official and personal 

capacities.

The proposed policy modification 

would provide clearer notice to 

respondents and the public as to the 

nature of the Commission’s enforcement 

actions, improve the perception of 

fairness among the regulated 

community, and merge the 

Commission’s treasurer designation into 

conceptually familiar legal principles 

for the federal judiciary.2 In explaining 

the proposed policy change, this section 

first surveys the law on the official/

personal capacity distinction; next, 

addresses when treasurers are properly 

named in their official or personal 

capacity or both; and finally, confronts 

the reoccurring issues of successor 

treasurers and substitution.

II. The Official/Personal Capacity 

Distinction 

In the seminal case of Kentucky v. 

Graham, 473 U.S. 159 (1985), the 

United States Supreme Court discussed 

the distinction between official capacity 

and personal capacity suits. The Court 

determined that a suit against an officer 

in her official capacity ‘‘generally 

represent[s] only another way of 

pleading an action against an entity of 

which an officer is an agent.’’ Id. at 165. 

In other words, an official capacity 

proceeding ‘‘is not a suit against the 

official but rather is a suit against the 

official’s office.’’ Will v. Mich. Dept. of 

State Police, 491 U.S. 58, 71 (1989). 

Accordingly, ‘‘an official-capacity suit 

is, in all respects other than name, to be 

treated as a suit against the entity.’’ 

Graham, 473 U.S. at 166. Therefore, in 

an official capacity suit, the plaintiff 

seeks a remedy from the entity, not the 

particular officer personally. 

A ‘‘personal-capacity action is * * * 

against the individual defendant, rather 

than * * * the entity that employs 

him.’’ Id. at 167–68. Since a ‘‘[p]ersonalcapacity suit[] seek[s] to impose 

personal liability upon’’ a particular 

individual, the individual is the true 

party in interest. Id. Liability lies with 

the particular officer personally, not 

with the officer’s position. See id. at 166 

n.11 (‘‘Should the official die pending 

final resolution of a personal-capacity 

action, the plaintiff would have to 

pursue his action against the decedent’s 

estate.’’); see also Hafer v. Melo, 502 

U.S. 21, 27 (1991) (‘‘officers sued in 

their personal capacity come to court as 

individuals’’). 


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3See Graham, 473 U.S. at 165 (42 U.S.C. 1983); 

Stafford v. Briggs, 444 U.S. 527, 544 (1980) (venue 

determination); Ex Parte Young, 209 U.S. 123, 159 

(1908) (Eleventh Amendment); Northeast Fed. 

Credit Union v. Neves, 837 F.2d 531, 534 (1st Cir. 

1988) (jurisdictional purposes); Pelkoffer v. Deer,

144 B.R. 282, 285–86 (W.D. Pa. 1992) (bankruptcy); 

Estabrook v. Wetmore, 529 A.2d 956, 958 (N.H. 

1987) (applying doctrine that acts of a corporate 

employee performed in his corporate capacity 

generally do not form the basis for personal 

jurisdiction over him in his individual capacity).

4 In the absence of a treasurer, ‘‘the financial 

machinery of the campaign grinds to a halt. * * *’’

FEC v. Toledano, 317 F.3d 939, 947 (9th Cir. 2003), 

reh’g denied; see 2 U.S.C. 432(a) (‘‘No expenditure 

shall be made * * * without the authorization of 

the treasurer or his or her designated agent.’’); 11 

CFR 102.7(a) (designation of assistant treasurer).

5Such accountability may be especially helpful 

in matters involving committees that tend to be 

ephemeral—existing for only a short time before 

permanently disbanding operations.

6 Indeed, if FECA were construed to impose 

liability on treasurers only in their official 

capacities, it would effectively mean that only 

committees are liable for violations under the 

statute—which would have been easy enough for 

Congress to accomplish by writing the Act to 

impose reporting, recordkeeping, and other duties 

on ‘‘committees’’ rather than ‘‘treasurers.’’

7The Act and the Commission’s regulations 

prohibit any ‘‘person’’ which includes individuals, 

from engaging in certain kinds of conduct. See, e.g., 

2 U.S.C. 432(b) (forward contributions to the 

committee’s treasurer), 441e (receipt of 

contributions from foreign nationals), and 441f 

(making and knowingly accepting contributions in 

the name of another).

8For example, the Commission, in some cases, 

may decide not to pursue a predecessor treasurer 

who technically has personal liability where the 

committee, through its current treasurer, has agreed 

to pay a sufficient civil penalty and to cease and 

desist from further violations of the Act.

The ‘‘distinction between claims 

aimed at a defendant in his individual 

as opposed to representative capacity 

can be found across the law.’’ McCarthy,

22 F.3d at 360 (citing numerous 

Supreme Court, lower court, and state 

cases referencing differences between 

individual and official capacity claims 

in multiple fields of law).3 The official 

capacity/individual capacity distinction 

also carries societal significance. As the 

McCarthy court explained:

The ubiquity of the [official capacity/

individual capacity] distinction is a 

reflection of the reality that individuals in 

our complex society frequently act on behalf 

of other parties—a reality that often makes it 

unfair to credit or blame the actor, 

individually, for such acts. At the same time, 

the law strikes a wise balance by refusing 

automatically to saddle a principal with total 

responsibility for a representative’s conduct, 

come what may, and by declining 

mechanically to limit an injured party’s 

recourse to the principal alone, regardless of 

the circumstances.

Id.

III. Naming Treasurers in Their Official 

Capacity 

Naming the current treasurer in his or 

her official capacity would improve the 

Commission’s enforcement practice in a 

number of ways. Most importantly, it 

would clarify that findings by the 

Commission (whether ‘‘Reason To 

Believe’’ or ‘‘Probable Cause To 

Believe’’) or the signing of a conciliation 

agreement only concerns the treasurer 

in his or her capacity as representative 

of the committee, not personally. The 

practice would also ensure that a named 

individual who signs the conciliation 

agreement on behalf of the committee 

(or obtains legal representation on 

behalf of the committee) is the one 

empowered by law to disburse 

committee funds to pay a civil penalty, 

disgorge funds, make refunds, and carry 

out other monetary remedies that the 

committee agrees to through the 

conciliation agreement.4 Also, naming a 

treasurer (in his or her official capacity), 

as opposed to naming simply the office 

of treasurer or just the committee, not 

only provides the Commission with an 

individual in every instance to serve 

with notices throughout the proceeding, 

but also results in more accountability 

on behalf of the committee—that is, a 

particular person who will ensure that 

a committee is responsive to 

Commission findings.5 Finally, 

specifying whether a treasurer is named 

in his or her official or personal capacity 

would be consistent with use of these 

terms as pleading conventions in court 

actions. A probable cause finding 

against a treasurer in his or her official 

capacity would make clear to a district 

court in enforcement litigation that the 

Commission is seeking relief against the 

committee, and would only entitle the 

Commission to obtain a civil penalty 

from the committee. See Graham, 473 

U.S. at 165.

IV. Naming Treasurers in Their 

Personal Capacity 

The Act places certain legal 

obligations on committee treasurers, the 

violation of which makes them 

personally liable. See, e.g., 2 U.S.C. 

432(c) (keep an account of various 

committee records), 432(d) (preserve 

records for three years), 434(a)(1) (file 

and sign reports of receipts and 

disbursements). The Commission’s 

regulations further require a treasurer to 

examine and investigate contributions 

for evidence of illegality. See 11 CFR 

103.3. Due to their ‘‘pivotal role,’’

treasurers may be held personally liable 

for failing to fulfill their responsibilities 

under the Act and the Commission’s 

regulations. See Toledano, 317 F.3d at 

947 (‘‘The Act requires every political 

committee to have a treasurer, 2 U.S.C. 

432(a), and holds him personally 

responsible for the committee’s 

recordkeeping and reporting duties, id. 

432(c)–(d), 434(a). * * * Federal law 

makes the treasurer responsible for 

detecting [facial contribution] 

illegalities, 11 CFR 103.3(b), and holds 

him personally liable if he fails to fulfill 

his responsibilities, see 2 U.S.C. 

437g(d). * * *’’) (emphasis added); see 

also FEC v. John A. Dramesi for Cong. 

Comm., 640 F. Supp. 985 (D.N.J. 1986) 

(holding treasurer responsible for failing 

to ‘‘make * * * best efforts to determine 

the legality of’’ an excessive 

contribution); FEC v. Gus Savage for 

Cong. ’82 Comm., 606 F. Supp. 541, 547 

(N.D. Ill. 1985) (‘‘It is the treasurer, and 

not the candidate, who becomes the 

named defendant in federal court, and 

subjected to the imposition of penalties 

ranging from substantial fines to 

imprisonment.’’); 104.14(d) (‘‘Each 

treasurer of a political committee, and 

any other person required to file any 

report or statement under these 

regulations and under the Act shall be 

personally responsible for the timely 

and complete filing of the report or 

statement and for the accuracy of any 

information or statement contained in 

it.’’) (emphasis added). Thus, a treasurer 

would be named as a respondent in a 

MUR in his or her personal capacity, 

and findings would be made against a 

treasurer in the same capacity, when the 

MUR involves the treasurer’s personal 

violation of a legal obligation that the 

statute or regulations impose 

specifically on committee treasurers and 

when a reasonable inference from the 

alleged violation is that the treasurer 

knew, or should have known, about the 

facts constituting a violation.6

Similarly, if a past or present treasurer 

violates a prohibition that applies to 

individuals, the treasurer would be 

named as a respondent in his or her 

personal capacity, and findings would 

be made against the treasurer in that 

capacity. In this way, a treasurer would 

be treated no differently than any other 

individual who violates a provision of 

the Act.7 Should the Commission file 

suit in district court following a finding 

of probable cause against a treasurer in 

his or her personal capacity, judicial 

relief, including an injunction and 

payment of a civil penalty, could be 

obtained against the treasurer 

personally. Graham, 473 U.S. at 166–

168. In any scenario, the Commission 

would, of course, remain free to exercise 

its prosecutorial discretion not to 

pursue a respondent.8

When the Commission obtains relief 

from a treasurer personally, the 

obligation will follow the individual. 

Thus, when a treasurer in his or her 


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9 In some cases, initially, the Commission does 

not have information that would indicate that the 

Commission should pursue a treasurer in his or her 

personal capacity for a violation. However, at a later 

stage of the enforcement process, evidence may 

arise that indicates that a treasurer is personally 

liable for a violation. In these instances, the 

Commission would exhaust the Act’s 

administrative prerequisites to suit before filing suit 

against the treasurer in his or her personal capacity. 

See 2 U.S.C. 437g(a)(3); FEC v. Nat’l Rifle Ass’n, 553 

F. Supp. 1331, 1337–38 (D.D.C. 1983).

10Pursuant to the proposed policy, the 

Commission would not be legally obligated to 

undertake the requirements of 2 U.S.C. 437g(a)(3) 

when a successor treasurer undertakes his or her 

position; although not legally required to do so, the 

Commission would intend to inform a new 

treasurer of the pending action and make copies of 

the briefs available to the successor treasurer.

personal capacity agrees to pay a civil 

penalty through a conciliation 

agreement, or is ordered to pay a civil 

penalty by a district court, a personal 

obligation exists to pay the civil penalty. 

(A separate civil penalty would likely be 

assessed against the committee itself.) 

Likewise, a cease and desist provision 

(negotiated through conciliation) or an 

injunction (imposed by a district court) 

against a treasurer in his or her personal 

capacity will still apply to that treasurer 

in the event he or she moves on to 

become treasurer with another 

committee. Cf. Sec’y Exch. Comm’n v. 

Coffey, 493 F.2d 1304, 1311 n.11 (6th 

Cir. 1974) (‘‘The significance of naming 

an officer * * * personally is that 

‘otherwise he is bound only as long as 

he remains an officer * * *, whereas if 

he is named [personally] he is 

personally enjoined without limit of 

time.’ ’’) (quoting 6 L. Loss, Securities 

Regulation 4113 (1969, supp. to 2d 

ed.)).9

V. Naming Treasurers in Both 

Capacities 

Treasurers would be initially 

generated as respondents in both their 

official and personal capacities only 

with respect to allegations that directly 

relate to reporting, recordkeeping, and 

other duties specifically imposed by the 

Act on treasurers. See, e.g., United 

States v. Johnson, 541 F.2d 710, 711 

(8th Cir. 1976) (applying a similar 

standard in an action involving the 

Federal Trade Commission when 

finding that ‘‘[t]he propriety of 

including a person both as an individual 

and as a corporate officer in a cease and 

desist order has consistently been 

upheld in instances where the person 

included was instrumental in 

formulating, directing and controlling 

the acts and practices of the 

corporation’’) (citing Fed. Trade 

Comm’n v. Standard Ed. Soc’y, 302 U.S. 

112 (1937); Standard Distrib. v. Fed. 

Trade Comm’n, 211 F.2d 7 (2d Cir. 

1954); Benrus Watch Co. v. Fed. Trade 

Comm’n, 352 F.2d 313 (8th Cir. 1965)). 

However, if the Office of General 

Counsel (‘‘OGC’’) is persuaded through 

the respondent’s response to the 

complaint, or the response to the 

Factual and Legal Analysis, or the 

Respondent’s Brief at the Probable 

Cause stage, or an investigation, that the 

treasurer was unaware, and had no 

reason to know, of the operative facts 

giving rise to a violation, OGC would 

recommend that findings against the 

treasurer only be made in his or her 

official capacity. 

On the other hand, if a complaint 

alleges a violation such as coordination 

or receipt of contributions in the name 

of another, the same reasonable 

inference as to the treasurer’s 

knowledge of the operative facts would 

not be drawn as a routine matter. The 

Commission proposes with respect to 

complaints of this nature that the 

treasurer would initially be named as a 

respondent only in his or her official 

capacity. Notably, in these cases the 

reporting violation stems from the same 

operative facts as the principal 

violation. Only if OGC learns later that 

the treasurer had knowledge of the 

operative facts—for example, the 

treasurer knew that an in-kind 

contribution stemming from 

coordination went unreported—might 

the Commission make findings against 

the treasurer in his or her personal 

capacity.

In cases where the treasurer has both 

official and personal liability, the 

respondents would be named as ‘‘John 

Doe for Congress and Joe Smith, in his 

official capacity as treasurer and in his 

personal capacity.’’ Alternatively, the 

respondents might be named as ‘‘John 

Doe for Congress and Joe Smith, in his 

official capacity as treasurer’’ and ‘‘John 

Doe, in his personal capacity.’’ Where a 

treasurer has been named in both his or 

her official and personal capacities, any 

resulting conciliation agreement would 

be signed by the current treasurer on 

behalf of both the committee and the 

treasurer in his or her personal capacity. 

VI. Successor Treasurers/Substitution 

An issue closely related to the 

official/personal capacity distinction is 

whether a successor treasurer may be 

substituted for a predecessor treasurer. 

Often the specific individual who was 

the treasurer at the time of a violation 

is no longer the treasurer when the 

Commission undertakes the 

enforcement process. Whether the 

successor treasurer or the predecessor 

treasurer should be named as the 

respondent depends on whether the 

Commission is pursuing the treasurer in 

his or her official capacity, personal 

capacity, or both. 

Under the present practice, when 

OGC discovers that a committee has 

changed treasurers since the point of the 

underlying violation, OGC typically 

notes the change of treasurer, the date 

of the change, the former treasurer’s 

name, and indicates whether an 

amendment was made to the Statement 

of Organization in its next report to the 

Commission. If a treasurer change is 

made after a finding of reason to believe, 

then OGC typically includes the new 

treasurer and notes the change in its 

next report on the matter. If a treasurer 

change is made after a finding of 

probable cause to believe, OGC sends 

the new treasurer a supplemental 

probable cause brief (incorporating the 

prior probable cause brief), which states 

that the Commission found probable 

cause to believe against the committee 

and the treasurer’s predecessor and will 

recommend probable cause against the 

new treasurer. After receiving a 

response or waiting until the expiration 

of the response period, OGC typically 

returns to the Commission with a 

recommendation to find probable cause 

to believe against the new treasurer. 

When the Commission pursues a 

current treasurer in his or her official 

capacity, any successor treasurer would 

be substituted for the predecessor 

treasurer. In such cases, the Commission 

is pursuing the official position (and, 

therefore, the entity), not the individual 

holding the position. See Will, 491 U.S. 

at 71. Because an official capacity action 

is an action against the treasurer’s 

position, the Commission may 

summarily substitute a new treasurer in 

his or her official capacity at any stage 

prior to a finding of probable cause to 

believe.10

When a predecessor treasurer is 

personally liable, the Commission 

would pursue the predecessor treasurer 

individually, and not substitute the 

successor treasurer for the predecessor 

treasurer individually. See fn. 7; 

Graham, 473 U.S. at 167–68. There 

would be no legal basis for imputing 

personal liability from a predecessor 

treasurer’s misconduct to a successor 

treasurer who did not personally engage 

in the misconduct. 

If the Commission were to pursue a 

treasurer both officially and 

individually and this treasurer is later 

replaced, the Commission would 

continue to pursue the predecessor 

treasurer for any violations for which he 

or she is personally liable, and 

substitute the successor treasurer for 

official capacity violations. Absent some 

independent basis of liability, the 


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Federal Register / Vol. 69, No. 18 / Wednesday, January 28, 2004 / Proposed Rules 4095

11For example, while Treasurer A is the treasurer 

for Joe Smith for Congress, a violation occurs that 

subjects A to official and individual liability. 

Treasurer A would be named in both his official 

and personal capacities. After the enforcement 

action has begun, Treasurer A resigns and Treasurer 

B takes over. The Commission should pursue 

Treasurer A in his individual capacity, and 

Treasurer B in her official capacity. If Treasurer B 

resigns and is succeeded by Treasurer C prior to the 

conclusion of the enforcement matter, the 

Commission should then continue to pursue 

Treasurer A in his individual capacity and pursue 

Treasurer C in her official capacity. Treasurer B is 

no longer named in her official capacity.

12A deeper examination of the court file indicates 

that—despite the California Democratic Party

court’s assertion to the contrary’’the Commission 

never actually pled that the treasurer in this case 

was personally liable. Rather, the complaint 

references the treasurer ‘‘as treasurer’’ and the 

Commission’s response to the treasurer’s motion to 

dismiss indicates that the Commission was 

pursuing the treasurer ‘‘in his official capacity.’’

Compl., paragraphs 8, 58–59, Prayer paragraphs 1–

5; Resp. to Def. Mot. to Dismiss, p. 21. However, 

the California Democratic Party court’s result 

underscores the need for the Commission to 

delineate more clearly the capacity in which it 

pursues treasurers.

Commission would not pursue 

intermediate treasurers.11 See 

Cal. Democratic Party v. FEC, 13 F. 

Supp. 2d 1031, 1037 (E.D. Cal. 1998) 

(dismissing individual capacity claims 

against a former treasurer because 

‘‘there is no allegation that [the 

treasurer] violated any personal 

obligation’’ and dismissing official 

capacity claims against him ‘‘since [he] 

is no longer treasurer * * * and thus, is 

not the appropriate person against 

whom an official capacity suit can be 

maintained. * * *’’).12

VII. Proposed Policy

In light of the considerations 

explained above, the Commission is 

considering exercising its discretion in 

enforcement matters by naming 

treasurers as follows: 

1. In all enforcement actions where a 

political committee is a respondent, 

name as respondents the committee and 

its current treasurer ‘‘in (his or her) 

official capacity as treasurer.’’

2. In enforcement actions where a 

treasurer has apparently breached a 

personal obligation owing by virtue of 

his or her responsibilities under the Act 

and regulations, or a prohibition that 

applies to individuals, name that 

treasurer as a respondent ‘‘in (his or her) 

personal capacity.’’

The Commission invites comments on 

this policy that is under consideration. 

Comments may be submitted on any 

aspect of the policy being considered, 

including: 

(A) If the Commission adopts the 

policy, are there certain circumstances 

that warrant flexibility in applying the 

policy? 

(B) Whether, and to what extent, the 

Commission should consider a 

treasurer’s ‘‘best efforts’’ to comply with 

the law. 

(C) Whether and how to apply the 

prospective policy in its Administrative 

Fines program.

Dated: January 23, 2004. 

Bradley A. Smith, 

Chairman, Federal Election Commission.

[FR Doc. 04–1790 Filed 1–27–04; 8:45 am] 

BILLING CODE 6715–01–P

CONSUMER PRODUCT SAFETY 

COMMISSION 

16 CFR Chapter II 

Pilot Program for Systematic Review of 

Commission Regulations; Request for 

Comments and Information

AGENCY: Consumer Product Safety 

Commission.

ACTION: Notice of systematic review of 

current regulations. 

SUMMARY: The Consumer Product Safety 

Commission (CPSC or Commission) is 

undertaking a pilot program to 

systematically review its current 

substantive regulations to ensure, to the 

maximum practical extent, consistency 

among them and with respect to 

accomplishing program goals. The pilot 

is currently expected to be completed by 

the end of calendar year 2004. 

Depending on the results of the pilot, 

the availability of personnel and fiscal 

resources, and other priorities for 

action, the Commission would then 

develop and implement an expanded 

systematic review process to address the 

remainder of its substantive regulations. 

The primary purpose of the review is 

to assess the degree to which the 

regulations under review remain 

consistent with the Commission’s 

program policies. In addition, each 

regulation will be examined with 

respect to the extent that it is current 

and relevant to CPSC program goals. 

Attention will also be given to whether 

the regulations can be streamlined, if 

possible, to minimize regulatory 

burdens, especially on small entities. To 

the degree consistent with other 

Commission priorities and subject to the 

availability of personnel and fiscal 

resources, specific regulatory or other 

projects may be undertaken in response 

to the results of this review. 

In the initial, pilot phase of this 

program the following four regulations 

will be evaluated: safety standard for 

walk-behind power mowers, 16 CFR 

part 1205; requirements for electrically 

operated toys and other electrically 

operated articles intended for use by 

children, 16 CFR part 1505; standard for 

the flammability of vinyl plastic film, 16 

CFR part 1611; and child-resistant 

packaging requirements for aspirin and 

methyl salicylate, 16 CFR 1700.14(a)(1) 

and 1700.14(a)(3), respectively. 

The Commission solicits written 

comments from interested persons 

concerning the designated regulations’

currentness and consistency with 

Commission policies and goals, and 

suggestions for streamlining where 

appropriate. In so doing, commenters 

are requested to specifically address 

how their suggestions for change could 

be accomplished within the various 

statutory frameworks for Commission 

action under the Consumer Product 

Safety Act (CPSA), 15 U.S.C. 2051–

2084, Federal Hazardous Substances Act 

(FHSA), 15 U.S.C. 1261–1278, 

Flammable Fabrics Act (FFA), 15 U.S.C. 

1191–1204; and Poison Prevention 

Packaging Act (PPPA), 15 U.S.C. 1471–

1476.

DATES: Written comments and 

submissions in response to this notice 

must be received by March 29, 2004.

ADDRESSES: Comments and other 

submissions should be captioned ‘‘Pilot 

Regulatory Review Project’’ and mailed 

to the Office of the Secretary, Consumer 

Product Safety Commission, 

Washington, DC 20207, or delivered to 

that office, room 502, 4330 East-West 

Highway, Bethesda, Maryland 20814. 

Comments and other submissions may 

also be filed by facsimile to (301) 504–

0127 or by e-mail to cpsc-os@cpsc.gov.

FOR FURTHER INFORMATION CONTACT: N.J. 

Scheers, PhD, Director, Office of 

Planning & Evaluation, U.S. Consumer 

Product Safety Commission, 

Washington, DC 20207; telephone (301) 

504–7670; e-mail nscheers@cpsc.gov.

SUPPLEMENTARY INFORMATION: 

A. The Pilot Review Program 

The President’s Office of Management 

and Budget has designed the Program 

Assessment Rating Tool (PART) to 

provide a consistent approach to rating 

programs across the Federal 

government. A description of the PART 

process and associated program 

evaluation materials is available online 

at: http://www.whitehouse.gov/omb/

budintegration/

part_assessing2004.html.

Based on an evaluation of the 

Commission’s regulatory programs 

using the PART, the recommendation 

was made that CPSC develop a plan to 

systematically review its current 

regulations to ensure consistency among 

them in accomplishing program goals. 

The pilot review program launched with 


Add. 46

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This section of the FEDERAL REGISTER

contains regulatory documents having general

applicability and legal effect, most of which

are keyed to and codified in the Code of

Federal Regulations, which is published under

50 titles pursuant to 44 U.S.C. 1510.

The Code of Federal Regulations is sold by

the Superintendent of Documents. Prices of

new books are listed in the first FEDERAL

REGISTER issue of each week.

Rules and Regulations Federal Register

3

Vol. 70, No. 1

Monday, January 3, 2005

1The terms ‘‘official capacity’’ and 

‘‘representative capacity’’ are generally 

interchangeable, as are the terms ‘‘personal 

capacity’’ and ‘‘individual capacity.’’ See McCarthy

v. Azure, 22 F.3d 351, 359 n.12 (1st Cir. 1994).

2 In any scenario, the Commission will, of course, 

remain free to exercise its prosecutorial discretion 

not to pursue a respondent. For example, the 

Commission, in some cases, may decide not to 

pursue a predecessor treasurer who technically has 

personal liability where the committee, through its 

current treasurer, has agreed to pay a sufficient civil 

penalty and to cease and desist from further 

violations of the Act.

FEDERAL ELECTION COMMISSION 

11 CFR Part 111 

[Notice 2004—20] 

Statement of Policy Regarding 

Treasurers Subject to Enforcement 

Proceedings

AGENCY: Federal Election Commission.

ACTION: Statement of policy.

SUMMARY: The Commission is issuing a 

Policy Statement to clarify when, in the 

course of an enforcement proceeding 

(known as a Matter Under Review or 

‘‘MUR’’), a treasurer is subject to 

Commission action in his or her official 

or personal capacity, or both. Under this 

policy, when the Commission 

investigates alleged violations of the 

Federal Election Campaign Act, as 

amended, the Presidential Election 

Campaign Fund Act, and the 

Presidential Primary Matching Payment 

Account Act (collectively ‘‘the Act’’ or 

‘‘FECA’’) involving a political 

committee, the treasurer will typically 

be subject to Commission action only in 

his or her official capacity. However, 

when information indicates that a 

treasurer has knowingly and willfully 

violated a provision of the Act or 

regulations, or has recklessly failed to 

fulfill duties specifically imposed on 

treasurers by the Act, or has 

intentionally deprived himself or herself 

of the operative facts giving rise to the 

violation, the Commission will consider 

the treasurer to have acted in a personal 

capacity and make findings (and pursue 

conciliation) accordingly. This Policy 

Statement also addresses situations in 

which treasurers are subject to 

Commission action in both their official 

and personal capacities, and situations 

where successor treasurers are named. 

The goal in adopting this policy is to 

clarify when a treasurer is subject to 

Commission action in a personal or 

official capacity, while at the same time 

preserving the Commission’s ability to 

obtain an appropriate remedy that will 

satisfactorily resolve enforcement 

matters, or to seek relief in court, if 

necessary, against a live person. 

Importantly, the policy is grounded in 

the statutory obligations specifically 

imposed on treasurers and wellestablished legal distinctions between 

official and personal capacity 

proceedings.

DATES: December 16, 2004.

FOR FURTHER INFORMATION CONTACT:

Peter G. Blumberg, Attorney, 999 E 

Street, NW., Washington, DC 20463, 

(202) 694–1650 or (800) 424–9530.

SUPPLEMENTARY INFORMATION: 

I. Introduction 

The Commission is modifying its 

current practices to specify more clearly 

when a treasurer is subject to a 

Commission enforcement proceeding in 

his or her ‘‘official’’ and/or ‘‘personal’’ 

capacity.1 Specifically, when a 

complaint asserts sufficient allegations 

to warrant naming a political committee 

as a respondent, the committee’s current 

treasurer will also be named as a 

respondent in his or her official 

capacity. In these circumstances, 

reason-to-believe and probable cause 

findings against the committee will also 

be accompanied by findings against the 

current treasurer in his or her official 

capacity. When the complaint asserts 

allegations that involve a past or present 

treasurer’s violation of obligations that 

the Act or regulations impose 

specifically on treasurers, then that 

treasurer may, in the circumstances 

described below, be named in his or her 

personal capacity, and findings may be 

made against the treasurer in that 

capacity. Thus, in some matters the 

current treasurer could be named in 

both official and personal capacities. 

Maintaining the Commission’s ability to 

pursue a treasurer as a respondent in 

either official or personal capacity 

allows the Commission discretion to 

fashion an appropriate remedy for 

violations of the Act.2

Notably, political committees are 

artificial entities that can act only 

through their agents, such as their 

treasurers, and often can be, by their 

very nature, ephemeral entities that may 

exist for all practical purposes for a 

limited period, such as during a single 

election cycle. Due to these 

characteristics, identifying a live person 

who is responsible for representing the 

committee in an enforcement action is 

particularly important. Without a live 

person to provide notice to and/or to 

attach liability to, the Commission may 

find itself at a significant disadvantage 

in protecting the public interest and in 

ensuring compliance with the laws it is 

responsible for enforcing. By virtue of 

their authority to disburse funds and file 

disclosure reports and to amend those 

reports, treasurers of committees are in 

the best position to carry out the 

requirements of a conciliation 

agreement such as paying a civil 

penalty, refunding or disgorging 

contributions, and amending reports. 

The Act designates treasurers to play 

a unique role in a political committee; 

indeed, a treasurer is the only office a 

political committee is required to fill. 2 

U.S.C. 432(a). Without a treasurer, 

committees cannot undertake the host of 

activities necessary to carry out their 

mission, including receiving and 

disbursing funds and publicly 

disclosing their finances in periodic 

reports filed with the Commission. Id.; 

2 U.S.C. 434(a)(1). Given this statutory 

role, especially the authority to receive 

and disburse funds (e.g., pay a civil 

penalty, refund improper contributions, 

disgorge ill-gotten funds) on behalf of 

the committee, designating the treasurer 

as the representative of the committee 

for purposes of compliance with the Act 

makes sense. 

Although the Commission may be 

entitled to take action as to a treasurer 

in both an official and individual 

capacity, in the typical enforcement 

matter the Commission expects that it 

will proceed against treasurers only in 

their official capacities. However, the 

Commission will consider treasurers 

parties to enforcement proceedings in 

their personal capacities where 

information indicates that the treasurer 


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3As discussed infra Part II., the phrases ‘‘official 

capacity’’ and ‘‘personal capacity’’ are legal terms 

of art that permeate such field as sovereign 

immunity, bankruptcy, corporations, and federal 

procedure. Their usage instantaneously identifies 

for the judiciary when the Commission is pursuing 

treasurers by virtue of their position, rather than by 

product of their actions.

4See Graham, 473 U.S. at 165 (42 U.S.C. 1983); 

Stafford v. Briggs, 444 U.S. 527, 544 (1980) (venue 

determination); Ex Parte Young, 209 U.S. 123, 159 

(1908) (Eleventh Amendment); Northeast Fed. 

Credit Union v. Neves, 837 F.2d 531, 534 (1st Cir. 

1988) (jurisdictional purposes); Pelkoffer v. Deer,

144 B.R. 282, 285–86 (W.D. Pa. 1992) (bankruptcy); 

Estabrook v. Wetmore, 529 A.2d 956, 958 (N.H. 

1987) (applying doctrine that acts of a corporate 

employee performed in his corporate capacity 

generally do not form the basis for personal 

jurisdiction over him in his individual capacity).

5 In the absence of a treasurer, ‘‘the financial 

machinery of the campaign grinds to a halt * * *’’

FEC v. Toledano, 317 F.3d 939, 947 (9th Cir. 2003), 

reh’g denied; see 2 U.S.C. 432(a) (‘‘No expenditure 

shall be made * * * without the authorization of 

the treasurer or his or her designated agent.’’); 11 

CFR 102.7(a) (designation of assistant treasurer).

6Such accountability may be especially helpful 

in matters involving committees that tend to be 

ephemeral—existing for only a short time before 

permanently disbanding operations.

knowingly and willfully violated an 

obligation that the Act or regulations 

specifically impose on treasurers or 

where the treasurer recklessly failed to 

fulfill the duties imposed by law, or 

where the treasurer has intentionally 

deprived himself or herself of the 

operative facts giving rise to the 

violation. In these circumstances, the 

Commission may decide to find reason 

to believe the treasurer has violated the 

Act in his or her personal capacity, as 

well as finding reason to believe the 

committee violated the Act. 

This statement of policy is intended 

to provide clearer notice to respondents 

and the public as to the nature of the 

Commission’s enforcement actions, 

improve the perception of fairness 

throughout the regulated community, 

and merge the Commission’s treasurer 

designation into conceptually familiar 

legal principles for the federal 

judiciary.3 The statement first surveys 

the law on the official/personal capacity 

distinction; next, addresses when the 

Commission will proceed as to 

treasurers in their official or personal 

capacity or both; and finally, resolves 

the reoccurring issues of successor 

treasurers and substitution.

The Commission’s Proposed 

Statement of Policy Regarding Naming 

of Treasurers in Enforcement Matters 

was published in the January 28, 2004, 

Federal Register. 69 FR 4092 (January 

28, 2004). One comment was received. 

The commenter stated that the 

Commission’s effort to clarify its 

treasurer naming policy is welcome, but 

he made several recommendations for 

how the Commission could assist 

treasurers to better understand their 

potential personal liability, such as 

requiring separate notices in instances 

where a treasurer was named in his or 

her individual and official capacities, 

and by enacting the policy’s proposals 

through a rulemaking, rather than a 

policy statement. The commenter’s 

suggestions were considered, but in 

order to allow the Commission to retain 

flexibility in processing its cases, and 

because the policy statement combined 

with existing laws and Commission 

regulations provide sufficient notice to 

treasurers of their responsibilities, the 

suggested changes were not 

implemented.

II. The Official/Personal Capacity 

Distinction 

In the seminal case of Kentucky v. 

Graham, 473 U.S. 159 (1985), the 

United States Supreme Court discussed 

the distinction between official capacity 

and personal capacity suits. The Court 

determined that a suit against an officer 

in her official capacity ‘‘generally 

represent[s] only another way of 

pleading an action against an entity of 

which an officer is an agent.’’ Id. at 165. 

In other words, an official capacity 

proceeding ‘‘is not a suit against the 

official but rather is a suit against the 

official’s office.’’ Will v. Mich. Dept. of 

State Police, 491 U.S. 58, 71 (1989). 

Accordingly, ‘‘an official-capacity suit 

is, in all respects other than name, to be 

treated as a suit against the entity.’’

Graham, 473 U.S. at 166. Therefore, in 

an official capacity suit, the plaintiff 

seeks a remedy from the entity, not the 

particular officer personally. 

A ‘‘personal-capacity action is * * * 

against the individual defendant, rather 

than * * * the entity that employs 

him.’’ Id. at 167’68. Since a ‘‘[p]ersonalcapacity suit[] seek[s] to impose 

personal liability upon’’ a particular 

individual, the individual is the true 

party in interest. Id. Liability lies with 

the particular officer personally, not 

with the officer’s position. See id. at 166 

n.11 (‘‘Should the official die pending 

final resolution of a personal-capacity 

action, the plaintiff would have to 

pursue his action against the decedent’s 

estate.’’); see also Hafer v. Melo, 502 

U.S. 21, 27 (1991) (‘‘officers sued in 

their personal capacity come to court as 

individuals’’). 

The ‘‘distinction between claims 

aimed at a defendant in his individual 

as opposed to representative capacity 

can be found across the law.’’ McCarthy,

22 F.3d at 360 (citing numerous 

Supreme Court, lower court, and state 

cases referencing differences between 

individual and official capacity claims 

in multiple fields of law).4 The official 

capacity/individual capacity distinction 

also carries societal significance. As the 

McCarthy court explained:

The ubiquity of the [official capacity/

individual capacity] distinction is a 

reflection of the reality that individuals in 

our complex society frequently act on behalf 

of other parties—a reality that often makes it 

unfair to credit or blame the actor, 

individually, for such acts. At the same time, 

the law strikes a wise balance by refusing 

automatically to saddle a principal with total 

responsibility for a representative’s conduct, 

come what may, and by declining 

mechanically to limit an injured party’s 

recourse to the principal alone, regardless of 

the circumstances.

Id.

III. Treasurers in Their Official 

Capacity 

Clearly indicating that the current 

treasurer is a party to an enforcement 

proceeding in his or her official capacity 

will improve the Commission’s 

enforcement of the law in a number of 

ways. Most importantly, it clarifies that 

findings by the Commission (whether 

‘‘Reason To Believe’’ or ‘‘Probable Cause 

To Believe’’) or the signing of a 

conciliation agreement only concerns 

the treasurer in his or her capacity as 

representative of the committee, not 

personally. The practice also ensures 

that a named individual who signs the 

conciliation agreement on behalf of the 

committee (or obtains legal 

representation on behalf of the 

committee) is the one empowered by 

law to disburse committee funds to pay 

a civil penalty, disgorge funds, make 

refunds, and carry out other monetary 

remedies that the committee agrees to 

through the conciliation agreement.5

Also, naming a treasurer (in his or her 

official capacity), as opposed to naming 

simply the office of treasurer or just the 

committee, not only provides the 

Commission with an individual in every 

instance to serve with notices 

throughout the proceeding, but also 

results in more accountability on behalf 

of the committee—that is, a particular 

person who will ensure that a 

committee is responsive to Commission 

findings.6 Finally, specifying whether a 

treasurer is a party to an enforcement 

proceeding in his or her official or 

personal capacity is consistent with use 

of these terms as pleading conventions 

in court actions. A probable cause 

finding against a treasurer in his or her 

official capacity makes clear to a district 

court in enforcement litigation that the 

Commission is seeking relief against the 

committee, and would only entitle the 


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7 If a past or present treasurer violates a 

prohibition that applies generally to individuals, 

the treasurer may be named as a respondent in his 

or her personal capacity, and findings may be made 

against the treasurer in that capacity. In this way, 

a treasurer would be treated no differently than any 

other individual who violates a provision of the 

Act. The Act and the Commission’s regulations 

apply to any ‘‘person,’’ which includes individuals. 

See, e.g., 2 U.S.C. 432(b) (forward contributions to 

the committee’s treasurer), 441e (receipt of 

contributions from foreign nationals), and 441f 

(making and knowingly accepting contributions in 

the name of another).

8 Indeed, if FECA were construed to impose 

liability on treasurers only in their official 

capacities, it would effectively mean that only 

committees are liable for violations under the 

statute—which would have been easy enough for 

Congress to accomplish by writing the Act to 

impose reporting, recordkeeping, and other duties 

on ‘‘committees’’ rather than ‘‘treasurers.’’ In fact, 

in some instances, the Act and the Commission’s 

regulations specifically impose obligations on 

committees and committee officers and candidates. 

See, e.g., 2 U.S.C. 441a(f) (receipt of excessive 

contributions), 11 CFR 104.7(b) (best efforts).

9Conversely, when a reason-to-believe finding is 

made against a treasurer in his or her official 

capacity only, but the potential violations at issue 

involve obligations specifically imposed by the Act 

or regulations on treasurers, the notice of the 

finding will be accompanied by a letter advising 

that the Commission could later decide to pursue 

the treasurer in a personal capacity if information 

shows that the treasurer knowingly and willfully 

violated the Act, or recklessly failed to fulfill the 

duties imposed by law, or intentionally deprived 

himself or herself of the operative facts giving rise 

to the violation.

Commission to obtain a civil penalty 

from the committee. See Graham, 473 

U.S. at 165.

IV. Treasurers in Their Personal 

Capacities 

The Act places certain legal 

obligations on committee treasurers, the 

violation of which makes them 

personally liable.7 See, e.g., 2 

U.S.C. 432(c) (keep an account of 

various committee records), 432(d) 

(preserve records for three years), 

434(a)(1) (file and sign reports of 

receipts and disbursements). The 

Commission’s regulations further 

require treasurers to examine and 

investigate contributions for evidence of 

illegality. See 11 CFR 103.3. Due to their 

‘‘pivotal role,’’ treasurers may be held 

personally liable for failing to fulfill 

their responsibilities under the Act and 

the Commission’s regulations. See 

Toledano, 317 F.3d at 947 (‘‘The Act 

requires every political committee to 

have a treasurer, 2 U.S.C. 432(a), and 

holds him personally responsible for the 

committee’s recordkeeping and 

reporting duties, id. 432(c)–(d), 434(a). 

* * * Federal law makes the treasurer 

responsible for detecting [facial 

contribution] illegalities, 11 CFR 

103.3(b), and holds him personally 

liable if he fails to fulfill his 

responsibilities, see 2 U.S.C. 437g(d) . 

***’’); see also FEC v. John A. 

Dramesi for Cong. Comm., 640 F. Supp. 

985 (D.N.J. 1986) (holding treasurer 

responsible for failing to ‘‘make * * * 

best efforts to determine the legality of’’

an excessive contribution); FEC v. Gus 

Savage for Cong. ’82 Comm., 606 F. 

Supp. 541, 547 (N.D. Ill. 1985) (‘‘It is the 

treasurer, and not the candidate, who 

becomes the named defendant in federal 

court, and subjected to the imposition of 

penalties ranging from substantial fines 

to imprisonment.’’); 104.14(d) (‘‘Each 

treasurer of a political committee, and 

any other person required to file any 

report or statement under these 

regulations and under the Act shall be 

personally responsible for the timely 

and complete filing of the report or 

statement and for the accuracy of any 

information or statement contained in 

it.’’).

Thus, a treasurer may be named as a 

respondent in a Matter Under Review in 

his or her personal capacity, and 

findings may be made against a 

treasurer in the same capacity, when the 

MUR involves the treasurer’s violation 

of a legal obligation that the statute or 

regulations impose specifically on 

committee treasurers or when a 

reasonable inference from the alleged 

violation is that the treasurer knew, or 

should have known, about the facts 

constituting a violation.8 In practice, 

however, the Commission intends to 

consider a treasurer the subject of an 

enforcement proceeding in his or her 

personal capacity only when available 

information (or inferences fairly derived 

therefrom) indicates that the treasurer 

had knowledge that his or her conduct 

violated a duty imposed by law, or 

where the treasurer recklessly failed to 

fulfill his or her duties under the act 

and regulations, or intentionally 

deprived himself or herself of facts 

giving rise to the violations. If, at any 

time in the proceeding, the Commission 

is persuaded that the treasurer did not 

act with the requisite state of mind, 

subsequent findings against the 

treasurer will only be made in his or her 

official capacity.9

Should the Commission file suit in 

district court following a finding of 

probable cause against a treasurer in his 

or her personal capacity, judicial relief, 

including an injunction and payment of 

a civil penalty, could be obtained 

against the treasurer personally. 

Graham, 473 U.S. at 166–168. Likewise, 

when the Commission obtains relief 

from a treasurer personally, the 

obligation will follow the individual. 

Thus, when a treasurer in his or her 

personal capacity agrees to pay a civil 

penalty through a conciliation 

agreement, or is ordered to pay a civil 

penalty by a district court, a personal 

obligation exists to pay the civil penalty. 

(A separate civil penalty would likely be 

assessed against the committee itself.) 

Likewise, a cease and desist provision 

(negotiated through conciliation) or an 

injunction (imposed by a district court) 

against a treasurer in his or her personal 

capacity will still apply to that treasurer 

in the event he or she subsequently 

becomes treasurer with another 

committee. Cf. Sec’y Exch. Comm’n v. 

Coffey, 493 F.2d 1304, 1311 n.11 (6th 

Cir. 1974) (‘‘The significance of naming 

an officer * * * personally is that 

‘otherwise he is bound only as long as 

he remains an officer * * *, whereas if 

he is named [personally] he is 

personally enjoined without limit of 

time.’ ’’) (quoting 6 L. Loss, Securities 

Regulation 4113 (1969, supp. to 2d ed.)). 

V. Treasurers in Both Capacities 

There will likely be cases in which 

the treasurer is subject to Commission 

action in both his or her official and 

personal capacity, as explained in supra

sections III. and IV. In such cases, the 

Commission will clearly designate that 

the findings are being made against the 

treasurer in both capacities. See, e.g., 

United States v. Johnson, 541 F.2d 710, 

711 (8th Cir. 1976) (applying a similar 

standard in an action involving the 

Federal Trade Commission when 

finding that ‘‘[t]he propriety of 

including a person both as an individual 

and as a corporate officer in a cease and 

desist order has consistently been 

upheld in instances where the person 

included was instrumental in 

formulating, directing and controlling 

the acts and practices of the 

corporation’’) (citing Fed. Trade 

Comm’n v. Standard Ed. Soc’y, 302 U.S. 

112 (1937); Standard Distrib. v. Fed. 

Trade Comm’n, 211 F.2d 7 (2d Cir. 

1954); Benrus Watch Co. v. Fed. Trade 

Comm’n, 352 F.2d 313 (8th Cir. 1965)). 

For example, if a complaint alleges a 

violation such as coordination or receipt 

of contributions in the name of another, 

the Commission intends initially to 

name the treasurer as a respondent only 

in his or her official capacity. Notably, 

in these cases the reporting violation 

stems from the same operative facts as 

the principal violation. Only if the 

Commission learns later that the 

treasurer had knowledge of the 

operative facts—for example, the 

treasurer knew that an in-kind 

contribution stemming from 

coordination went unreported—or acted 

recklessly, or intentionally deprived 

himself or herself of the relevant facts, 

might the Commission make findings 


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10Pursuant to the final policy, the Commission is 

not legally obligated to undertake the requirements 

of 2 U.S.C. 437g(a)(3) when a successor treasurer 

begins his or her position; although not legally 

required to do so, the Commission would intend to 

inform a new treasurer of the pending action and 

make copies of the briefs available to the successor 

treasurer.

11For example, while Treasurer A is the treasurer 

for Joe Smith for Congress, a violation occurs that 

subjects A to official liability and potentially to 

individual liability. Treasurer A would be named in 

his official capacity and notified in a reason-tobelieve notification of the potential for personal 

liability. After the enforcement action has begun, 

Treasurer A resigns and Treasurer B takes over. The 

Commission would pursue Treasurer B in her 

official capacity, and if the circumstances 

warranted, Treasurer A in his individual capacity. 

If Treasurer B resigns and is succeeded by Treasurer 

C prior to the conclusion of the enforcement matter, 

the Commission would then continue to pursue 

Treasurer A in his individual capacity and pursue 

Treasurer C in her official capacity. Treasurer B 

would no longer be named in her official capacity.

12A deeper examination of the court file indicates 

that—despite the California Democratic Party

court’s assertion to the contrary—the Commission 

never actually pled that the treasurer in this case 

was personally liable. Rather, the complaint 

references the treasurer ‘‘as treasurer’’ and the 

Commission’s response to the treasurer’s motion to 

dismiss indicates that the Commission was 

pursuing the treasurer ‘‘in his official capacity.’’

Compl., paragraphs 8, 58–59, Prayer paragraphs 1–

5; Resp. to Def. Mot. to Dismiss, p. 21. However, 

the court’s statement in California Democratic Party

underscores the need for the Commission to 

delineate more clearly the capacity in which it 

pursues treasurers.

against the treasurer in his or her 

personal capacity.

In cases where the treasurer is subject 

to Commission action in both official 

and personal capacities, the respondents 

could be named as ‘‘John Doe for 

Congress and Joe Smith, in his official 

capacity as treasurer and in his personal 

capacity.’’ Alternatively, the 

respondents could be named as ‘‘John 

Doe for Congress and Joe Smith, in his 

official capacity as treasurer’’ and ‘‘Joe 

Smith, in his personal capacity.’’

Regardless of the form of the 

notification, where a treasurer has been 

named in both his or her official and 

personal capacities, any resulting 

conciliation agreement would be signed 

by the treasurer on behalf of both the 

committee and the treasurer in his or 

her personal capacity. 

VI. Successor Treasurers/Substitution 

An issue closely related to the 

official/personal capacity distinction is 

whether a successor treasurer may be 

substituted for a predecessor treasurer 

in a matter under review. Often the 

specific individual who was the 

treasurer at the time of a violation is no 

longer the treasurer during the 

enforcement process. Whether the 

successor treasurer or the predecessor 

treasurer should be named as the 

respondent depends on whether the 

Commission is pursuing the treasurer in 

his or her official capacity, personal 

capacity, or both. 

Currently, when OGC discovers that a 

committee has changed treasurers after 

the date of the activity on which the 

finding was based, OGC typically notes 

the change of treasurer, the date of the 

change, the former treasurer’s name, and 

indicates whether an amendment was 

made to the Statement of Organization 

in OGC’s next report to the Commission. 

If a treasurer change is made after a 

finding of reason to believe, then OGC 

typically includes the new treasurer and 

notes the change in its next report on 

the matter. If a treasurer change is made 

after a finding of probable cause to 

believe, OGC sends the new treasurer a 

supplemental probable cause brief 

(incorporating the prior probable cause 

brief), which states that the Commission 

found probable cause to believe against 

the committee and the treasurer’s 

predecessor and will recommend 

probable cause against the new 

treasurer. After receiving a response or 

waiting until the expiration of the 

response period, OGC typically returns 

to the Commission with a 

recommendation as to the new 

treasurer. 

When the Commission pursues a 

current treasurer in his or her official 

capacity, successor treasurers will be 

substituted for the predecessor 

treasurer. In such cases, the Commission 

is pursuing the official position (and, 

therefore, the entity), not the individual 

holding the position. See Will, 491 U.S. 

at 71. Because an official capacity action 

is an action against the treasurer’s 

position, the Commission may 

summarily substitute a new treasurer in 

his or her official capacity at any stage 

prior to a finding of probable cause to 

believe.10

When a predecessor treasurer may be 

personally liable, the Commission could 

pursue the predecessor treasurer 

individually, and not substitute the 

successor treasurer for the predecessor 

treasurer individually. See fn. 7; 

Graham, 473 U.S. at 167–68. There 

would be no legal basis for imputing 

personal liability from a predecessor 

treasurer’s misconduct to a successor 

treasurer who did not personally engage 

in the misconduct. 

If the Commission were to pursue a 

treasurer both officially and personally 

and this treasurer is later replaced, the 

Commission could pursue the 

predecessor treasurer for any violations 

for which he or she is personally liable, 

and substitute the successor treasurer 

for official capacity violations. Absent 

some independent basis of liability, the 

Commission does not intend to pursue 

intermediate treasurers.11 See 

Cal. Democratic Party v. FEC, 13 F. 

Supp. 2d 1031, 1037 (E.D. Cal. 1998) 

(dismissing individual capacity claims 

against a former treasurer because 

‘‘there is no allegation that [the 

treasurer] violated any personal 

obligation’’ and dismissing official 

capacity claims against him ‘‘since [he] 

is no longer treasurer * * * and thus, is 

not the appropriate person against 

whom an official capacity suit can be 

maintained. * * *’’).12

VII. Conclusion 

Effective as of the date this Policy 

Statement is published in the Federal 

Register, and as more fully explained 

above, the Commission will consider 

treasurers of political committees 

subject to enforcement proceedings as 

follows: 

1. In enforcement proceedings where 

a political committee is a respondent, 

the committee’s current treasurer will be 

subject to Commission action ‘‘in (his or 

her) official capacity as treasurer.’’

2. In enforcement proceedings where 

information indicates that a treasurer 

(past or present) of a political committee 

(a) knowingly and willfully violated the 

Act or regulations, (b) recklessly failed 

to fulfill the duties imposed by a 

provision of the Act or regulations that 

applies specifically to treasurers, or (c) 

intentionally deprived himself or herself 

of the operative facts giving rise to a 

violation, the treasurer may be subject to 

Commission action ‘‘in (his or her) 

personal capacity.’’

3. In enforcement proceedings where 

information indicates that a treasurer of 

a political committee is subject to 

findings in both an official and personal 

capacity (i.e., information indicates that 

the committee’s current treasurer 

violated the Act or regulations with the 

requisite state of mind described in #2 

above), the current treasurer may be 

subject to Commission action in both an 

official and personal capacity. 

4. When the Commission makes 

findings as to a treasurer in his or her 

official capacity, successor treasurers 

will be substituted as if the findings had 

been made as to the successor. 

5. In enforcement proceedings 

involving provisions of the Act or 

regulations that apply generally to 

individuals (e.g., prohibitions against 

the making of an excessive 

contribution), the treasurer will be 

subject to Commission action in his or 

her personal capacity the same as any 

other individuals.


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Federal Register / Vol. 70, No. 1 / Monday, January 3, 2005 / Rules and Regulations 7

Dated: December 23, 2004. 

Bradley A. Smith, 

Chairman, Federal Election Commission.

[FR Doc. 04–28668 Filed 12–30–04; 8:45 am] 

BILLING CODE 6715–01–P

DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration 

14 CFR Part 39 

[Docket No. FAA–2004–19969; Directorate 

Identifier 2004–SW–43–AD; Amendment 39–

13923; AD 2004–26–11] 

RIN 2120–AA64 

Airworthiness Directives; Bell 

Helicopter Textron Canada Model 222, 

222B, 222U, 230, and 430 Helicopters

AGENCY: Federal Aviation 

Administration, DOT.

ACTION: Final rule; request for 

comments. 

SUMMARY: This amendment adopts a 

new airworthiness directive (AD) for the 

specified Bell Helicopter Textron 

(BHTC) model helicopters. This action 

requires certain checks and inspections 

of the tail rotor blades. If a crack is 

found, before further flight, this AD 

requires replacing the tail rotor blade 

(blade) with an airworthy blade. This 

amendment is prompted by three 

reports of cracked blades found during 

scheduled inspections. The actions 

specified in this AD are intended to 

detect a crack in the blade and prevent 

loss of a blade and subsequent loss of 

control of the helicopter.

DATES: Effective January 18, 2005. 

Comments for inclusion in the Rules 

Docket must be received on or before 

March 4, 2005.

ADDRESSES: Use one of the following 

addresses to submit comments on this 

AD: 

• DOT Docket Web site: Go to

http://dms.dot.gov and follow the 

instructions for sending your comments 

electronically; 

• Government-wide rulemaking Web 

site: Go to http://www.regulations.gov

and follow the instructions for sending 

your comments electronically; 

• Mail: Docket Management Facility; 

U.S. Department of Transportation, 400 

Seventh Street, SW., Nassif Building, 

Room PL–401, Washington, DC 20590; 

• Fax: (202) 493–2251; or 

• Hand Delivery: Room PL–401 on 

the plaza level of the Nassif Building, 

400 Seventh Street, SW., Washington, 

DC, between 9 a.m. and 5 p.m., Monday 

through Friday, except Federal holidays. 

You may get the service information 

identified in this AD from Bell 

Helicopter Textron Canada, 12,800 Rue 

de l’Avenir, Mirabel, Quebec J7J1R4, 

telephone (450) 437–2862 or (800) 363–

8023, fax (450) 433–0272. 

Examining the Docket 

You may examine the docket that 

contains the AD, any comments, and 

other information on the Internet at 

http://dms.dot.gov, or in person at the 

Docket Management System (DMS) 

Docket Offices between 9 a.m. and 5 

p.m., Monday through Friday, except 

Federal holidays. The Docket Office 

(telephone (800) 647–5227) is located on 

the plaza level of the Department of 

Transportation Nassif Building at the 

street address stated in the ADDRESSES

section. Comments will be available in 

the AD docket shortly after the DMS 

receives them.

FOR FURTHER INFORMATION CONTACT:

Sharon Miles, Aviation Safety Engineer, 

FAA, Rotorcraft Directorate, Regulations 

and Guidance Group, Fort Worth, Texas 

76193–0111, telephone (817) 222–5122, 

fax (817) 222–5961.

SUPPLEMENTARY INFORMATION: This 

amendment adopts a new AD for the 

specified BHTC model helicopters. This 

action requires certain checks and 

inspections of the blades. If a crack is 

found, before further flight, this AD 

requires replacing the blade with an 

airworthy blade. This amendment is 

prompted by three reports of cracked 

blades found during scheduled 

inspections. This condition, if not 

detected, could result in loss of a blade 

and subsequent loss of control of the 

helicopter. 

Transport Canada, the airworthiness 

authority for Canada, notified the FAA 

that an unsafe condition may exist on 

the specified BHTC model helicopters. 

Transport Canada advises of the 

discovery of cracked blades during 

scheduled inspections on three 

occasions. Two cracks originated from 

the outboard feathering bearing bore 

underneath the flanged sleeves. The 

third crack started from the inboard 

feathering bearing bore. Investigation 

found that the cracks originated from 

either a machining burr or a corrosion 

site in the bearing bore underneath the 

flanged sleeves. 

BHTC has issued Alert Service 

Bulletin (ASB) No. 222–04–100 for 

Model 222 and 222B helicopters, No. 

222U–04–71 for Model 222U 

helicopters, No. 230–04–31 for Model 

230 helicopters, and No. 430–04–31 for 

Model 430 helicopters, all dated August 

27, 2004. The ASBs specify a repetitive 

visual inspection every 3 hours time-inservice (TIS) and a 50-hour inspection 

of the blade root end around the 

feathering bearings for a crack. 

Transport Canada classified these ASBs 

as mandatory and issued AD CF–2004–

21, dated October 28, 2004, to ensure 

the continued airworthiness of these 

helicopters in Canada. 

These helicopter models are 

manufactured in Canada and are type 

certificated for operation in the United 

States under the provisions of 14 CFR 

21.29 and the applicable bilateral 

agreement. Pursuant to the applicable 

bilateral agreement, Transport Canada 

has kept the FAA informed of the 

situation described above. The FAA has 

examined the findings of Transport 

Canada, reviewed all available 

information, and determined that AD 

action is necessary for products of these 

type designs that are certificated for 

operation in the United States. 

This unsafe condition is likely to exist 

or develop on other helicopters of the 

same type designs. Therefore, this AD is 

being issued to prevent loss of a blade 

and subsequent loss of control of the 

helicopter. This AD requires the 

following: 

• Within 3 hours time-in-service 

(TIS), and at specified intervals, clean 

and visually check both sides of each 

blade for a crack in the area around the 

tail rotor feathering bearing. An owner/

operator (pilot) may perform the check 

for cracked blades. Pilots may perform 

these checks because they require no 

tools, can be done by observation, and 

can be done equally well by a pilot or 

a mechanic. However, the pilot must 

enter compliance with these 

requirements into the helicopter 

maintenance records by following 14 

CFR 43.11 and 91.417(a)(2)(v). 

• Within 50 hours TIS and at 

specified intervals, clean and inspect 

both sides of each blade for a crack 

using a 10X or higher magnifying glass. 

• If a crack is found even in the paint 

during a visual check or during a 50-

hour TIS inspection, before further 

flight, a further inspection of the blade 

for a crack is required as follows:

• Remove the blade. Remove the 

paint to the bare metal in the area of the 

suspected crack by using Plastic Metal 

Blasting (PMB) or a nylon web abrasive 

pad and abrading the blade surface in a 

span-wise direction only. 

• Using a 10X or higher power 

magnifying glass, inspect the blade for 

a crack. 

• If a crack is found, before further 

flight, replace the blade with an 

airworthy blade. 

• If no crack is found in the blade 

surface, refinish the blade by applying 

one coat of MIL–P–23377 or MIL–P–

85582 Epoxy Polyamide Primer so that 

the primer overlaps the existing coats 


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