ORAL ARGUMENT NOT YET SCHEDULED 

No. 13-5008

_______________________________________________

UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMBIA CIRCUIT _______________________________________________

STOP THIS INSANITY, INC., et al.,

Appellants,

v.

FEDERAL ELECTION COMMISSION,

Appellee. _______________________________________________

On Appeal from the United States District Court

for the District of Columbia _______________________________________________

BRIEF FOR THE FEDERAL ELECTION COMMISSION _______________________________________________

Anthony Herman

General Counsel

Lisa J. Stevenson

Deputy General Counsel – Law

Kevin Deeley

Acting Associate General Counsel

Erin Chlopak

Acting Assistant General Counsel

Steve Hajjar

Attorney

FEDERAL ELECTION COMMISSION 

999 E Street, N.W. 

Washington, D.C. 20463

May 23, 2013 (202) 694-1650 

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CERTIFICATE AS TO PARTIES, RULINGS, AND RELATED CASES

Pursuant to this Court’s Order of January 8, 2013, and D.C. Cir. R. 28(a)(1),

appellee Federal Election Commission submits its Certificate as to

Parties, Rulings, and Related Cases.

(A) Parties and Amici. Stop This Insanity Inc. Employee Leadership 

Fund; Stop This Insanity, Inc.; Glengary, LLC; Todd Cefaratti; and Ladd Ehlinger

were the plaintiffs in the district court and are the appellants in this Court. The 

Commission was the defendant in the district court and is the appellee in this 

Court. No parties participated as amici curiae in the district court, and no parties 

have requested to participate as amici curiae before this Court.

(B) Rulings Under Review. Appellants appeal the November 5, 2012, final 

order of the United States District Court for the District of Columbia denying their 

motion for a preliminary injunction and granting the Commission’s motion to 

dismiss for failure to state a claim on which relief can be granted. The district 

court’s opinion has not yet been published in the Federal Supplement but is 

available at Stop This Insanity Inc. Employee Leadership Fund v. FEC, 2012 WL 

5383581 (D.D.C. Nov. 5, 2012) (Howell, J.).

(C) Related Cases. The Commission knows of no “related cases” as that

phrase is defined in D.C. Cir. R. 28(a)(1)(C).

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TABLE OF CONTENTS

Page

COUNTERSTATEMENT OF JURISDICTION ....................................... 1

COUNTERSTATEMENT OF ISSUE PRESENTED................................ 1

STATUTES AND REGULATIONS.......................................................... 1

COUNTERSTATEMENT OF THE CASE................................................ 1

COUNTERSTATEMENT OF THE FACTS ............................................. 3

I. Statutory and Regulatory Background ............................................. 3

A. Separate Segregated Funds..................................................... 3

B. Regulation of SSFs and Nonconnected PACs ....................... 6

C. “Super PACs,” “Non-Contribution Accounts,” 

and Disclosure ........................................................................ 9

II. Factual Background and Procedural History.................................. 13

A. The Parties............................................................................ 13

B. The Advisory Opinion Request............................................ 15

C. District Court Proceedings................................................... 17

D. District Court Opinion.......................................................... 18

SUMMARY OF ARGUMENT................................................................ 20

STANDARD OF REVIEW...................................................................... 23

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ARGUMENT............................................................................................ 24

I. THE FIRST AMENDMENT DOES NOT REQUIRE THE 

GOVERNMENT TO PERMIT THE MECHANISM 

APPELLANTS SEEK TO USE TO FINANCE INDEPENDENT 

CAMPAIGN ADVOCACY ........................................................... 24

A. Appellants Have No Constitutional Right to Repurpose 

STI Fund in a Manner that Fundamentally Contravenes 

the Role SSFs Actually Play in FECA’s Regulatory 

Scheme ................................................................................. 26

B. The Challenged Statutory Provisions Impose No Burden 

on STI’s Ability to Engage in Unlimited Independent 

Political Advocacy ............................................................... 29

C. The Challenged Provisions Are Subject to Intermediate 

Scrutiny................................................................................. 33

II. THE CHALLENGED STATUTORY PROVISIONS FURTHER

THE IMPORTANT GOVERNMENTAL INTEREST OF 

DISCLOSING THE FUNDING OF CAMPAIGN SPEECH........ 38

A. Appellants’ Proposed Relief Would Enable Corporations 

to Conceal Campaign-Related Spending ............................. 40

B. There Is No Legal Basis for Permitting STI to Evade 

FECA’s Disclosure Provisions............................................. 45

III. FECA’s SOLICITATION RESTRICTIONS FOR SSFs

FURTHER THE GOVERNMENTAL INTEREST OF

PREVENTING CORPORATIONS FROM COERCING THEIR 

EMPLOYEES AND OTHERS INTO MAKING UNLIMITED 

POLITICAL CONTRIBUTIONS .................................................. 50

IV. APPELLANTS’ REQUEST FOR A PRELIMINARY INJUNCTION

IS MOOT........................................................................................ 56

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A. The District Court Correctly Held that Appellants Suffered

No Cognizable Harm During the Pendency of This Case ... 58

B. The District Court Correctly Held that the Balance of 

Equities and the Public Interest Weighed Against 

Enjoining Enforcement of FECA’s Disclosure and 

Anti-Coercion Provisions..................................................... 60

CONCLUSION......................................................................................... 62

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TABLE OF AUTHORITIES

Page

Cases

Agostini v. Felton, 521 U.S. 203 (1997)................................................... 48

Am. For Safe Access v. DEA, 706 F.3d 438 (D.C. Cir. 2013).................. 28

American Postal Workers v. U.S. Postal Service, 764 F.2d 858

(D.C. Cir. 1985)............................................................................. 57

Ashcroft v. Iqbal, 556 U.S. 662 (2009)..................................................... 23

Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007)..................................... 23

Blount v. SEC, 61 F.3d 938 (D.C. Cir. 1995) ........................................... 36

Bowen v. Kendrick, 483 U.S. 1304 (1987) ............................................... 61

Buckley v. Valeo, 424 U.S. 1 (1976)...............10, 28, 30, 31, 34, 38, 44, 55

Carey v. FEC, 791 F. Supp. 2d 121 (D.D.C. 2011)............................ 12, 16

Carter v. Washington Metro. Area Transit Auth., 503 F.3d 143

(D.C. Cir. 2007).............................................................................. 23

Charlesbank Equity Fund II v. Blinds To Go, Inc., 370 F.3d 151

(1st Cir. 2004)................................................................................. 60

Christian Civic League of Me., Inc. v. FEC, 433 F. Supp. 2d 81

(D.D.C. 2006) ........................................................................... 61, 62

*Citizens United v. FEC, 558 U.S. 310 (2010) .....3, 4, 5, 9, 21, 24, 27, 29,

 30, 31, 35, 36, 38, 39, 43, 46, 47

*Cases and Authorities chiefly relied upon are marked with an asterisk.

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CityFed Fin. Corp. v. Office of Thrift Supervision, 58 F.3d 738

(D.C. Cir. 1995).............................................................................. 59

Davis v. FEC, 554 U.S. 724 (2008).......................................................... 30

Davis v. Pension Benefit Guar. Corp., 571 F.3d 1288

(D.C. Cir. 2009).............................................................................. 58

Doe v. Reed, 130 S. Ct. 2811 (2010) ........................................................ 39

Elrod v. Burns, 427 U.S. 347 (1976) ........................................................ 58

EMILY’s List v. FEC, 581 F.3d 1 (D.C. Cir. 2009)................ 16, 47, 48, 49

FEC v. Beaumont, 539 U.S. 146 (2000)......................................... 3, 34, 38

*FEC v. Nat’l Right to Work Comm., 459 U.S. 197

(1982).........................................................................4-5, 6, 9, 28, 47

Hankins v. Temple Univ. Health Sciences Ctr., 829 F.2d 437

(3rd Cir. 1987)................................................................................. 57

Haw. Gov’t Emp. Ass’n v. Martoche, 915 F.2d 718 (D.C. Cir. 1990) ..... 48

Hettinga v. United States, 677 F.3d 471 (D.C. Cir. 2012).................. 23, 24

Hicks v. Bush, 397 F. Supp. 2d 36 (D.D.C. 2005).................................... 59

Lyng v. Int’l Union, United Auto., Aerospace and Agric. Implement 

Workers of Am., 485 U.S. 360 (1988) ............................................ 48

McConnell v. FEC, 540 U.S. 93 (2003).................................. 34, 35, 36, 37

NTEU v. United States, 927 F.2d 1253 (D.C. Cir. 1991) ......................... 58

Nat’l Org. for Marriage v. McKee, 649 F.3d 34 (2011),

cert. denied, 132 S. Ct. 1635 (2012)............................................... 44

Pipefitters Local Union No. 562 v. United States, 407 U.S. 385

(1972)...................................................................................28, 51-52

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Quince Orchard Valley Citizens Ass’n, Inc. v. Hodel, 872 F.2d 75

(4th Cir. 1989) ................................................................................ 61

Randall v. Sorrell, 548 U.S. 230 (2006)................................................... 34

Real Truth About Obama v. FEC, 575 F.3d 342 (4th Cir. 2009),

vacated on other grounds, 130 S. Ct. 2371 (2010) ........................ 62

Republican Nat’l Comm. v. FEC, 698 F. Supp. 2d 150

(D.D.C. 2010), aff’d mem., 130 S. Ct. 3544 (2010)........... 34, 35, 38

Rodriguez de Quijas v. Shearson/Am. Express, Inc., 490 U. S. 477

(1989).........................................................................................48-49

Schenley Distillers Corp. v. United States, 326 U.S. 432 (1946)............. 28

*SpeechNow.org v. FEC, 599 F.3d 686

(D.C. Cir. 2010) (en banc)................................10, 16, 33, 39, 44, 47

Stop This Insanity, Inc. Employee Leadership Fund v. FEC, 

2012 WL 5383581 (D.D.C. Nov. 5, 2012)..................................... 20

Survival Education Fund v. FEC, 65 F.3d 285 (2d Cir. 1995)........... 31, 40

Tenacre Foundation v. INS, 78 F.3d 693 (D.C. Cir. 1996)...................... 60

Terry v. Leblanc, 475 Fed. Appx. 514 (5th Cir. 2012)............................. 57

United States v. Danielczyk, 683 F.3d 611 (4th Cir. 2012),

cert. denied, 1335 S. Ct. 1459 (2013)............................................. 49

United States v. Oakland Cannabis Buyer’s Co-op., 532 U.S. 483

(2001).............................................................................................. 61

Village of Schaumberg v. Citizens for a Better Environment, 

444 U.S. 620 (1980)...................................................................37-38

Wagner v. Taylor, 836 F.2d 566 (D.C. Cir. 1987).................................... 58

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Wis. Gas Co. v. FERC, 758 F.2d 669 (D.C. Cir. 1985)............................ 58 

Wisconsin Right to Life v. FEC, 551 U.S. 449 (2007).............................. 61 

Statutes and Regulations

Bipartisan Campaign Reform Act, Pub. L. No. 107-155,

116 Stat. 81 (2002) ......................................................................... 34

Federal Election Campaign Act, 2 U.S.C. §§ 431-57........................... 1, 13

2 U.S.C. § 431(4)(A)................................................................................. 44

2 U.S.C. § 431(4)(B)................................................................................... 4

2 U.S.C. § 431(7)...................................................................................... 27

2 U.S.C. § 431(8)(B)(vi)............................................................................. 7

2 U.S.C. § 431(9)(B)(v).............................................................................. 7

2 U.S.C. § 431(17)...................................................................................... 3

2 U.S.C. § 434(a) ........................................................................................ 6

2 U.S.C. § 434(b)................................................................................ 4, 6, 7

2 U.S.C. § 434(b)(3).................................................................................... 7

2 U.S.C. § 434(b)(5).................................................................................... 7

2 U.S.C. § 434(b)(4).................................................................................. 41

2 U.S.C. §434(f)(3)(A)(i)............................................................................ 4

2 U.S.C. § 437c(c)..................................................................................... 17

2 U.S.C. § 437c(b)(1)................................................................................ 13

2 U.S.C. § 437d(a)(7).......................................................................... 13, 17

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2 U.S.C. § 437d(a)(8)................................................................................ 13

2 U.S.C. § 437f ......................................................................................... 13

2 U.S.C. § 438(a)(8).................................................................................. 13

2 U.S.C. § 438(d)...................................................................................... 13

2 U.S.C. § 441a ......................................................................................... 34

2 U.S.C. § 441a(a)(1)(C)........................................................... 6, 17, 18, 51

2 U.S.C. § 441a(a)(3)................................................................................ 18

2 U.S.C. § 441b......................................................................................... 13

2 U.S.C. § 441b(a) ............................................................................ 3, 4, 56

2 U.S.C. § 441b(b)(2)............................................................................... 3,4

2 U.S.C. § 441b(b)(2)(C)...................................................2, 4, 7, 11-12, 26

2 U.S.C. § 441b(b)(3)(A).......................................................................... 55

2 U.S.C. § 441b(b)(3)(B)...................................................................... 8, 54

2 U.S.C. § 441b(b)(3)(C)...................................................................... 8, 54

*2 U.S.C. § 441b(b)(4).......................................................................... 4, 17

2 U.S.C. § 441b(b)(4)(A)(i)............................................8, 9, 16, 18, 27, 54

2 U.S.C. § 441b(b)(4)(B)..................................8, 15, 16, 50, 51, 52, 53, 54

2 U.S.C. § 441c ......................................................................................... 13

2 U.S.C. § 441e ......................................................................................... 13 

2 U.S.C. § 441i(a) ..................................................................................... 35

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26 U.S.C. § 501(c)(4)................................................................................ 13

28 U.S.C. § 1291......................................................................................... 1

28 U.S.C. § 1331......................................................................................... 1

11 C.F.R. § 114.1(j) .................................................................................... 8

11 C.F.R. § 114.5(b) ....................................................................... 7, 12, 40

11 C.F.R. § 114.5(e)(1)......................................................................... 7, 40

11 C.F.R. § 114.5(e)(3)............................................................................... 6

11 C.F.R. § 114.5(f).......................................................................... 4, 6, 51

11 C.F.R. § 114.5(g) ................................................................................... 4

11 C.F.R. § 114.5(g)(1)........................................................................... 8, 9

11 C.F.R. § 114.6 ........................................................................................ 8

Miscellaneous

122 Cong. Rec. S3700 (daily ed. Mar. 17, 1976) (statement of 

Sen. Bumpers)............................................................................. 8, 51

122 Cong. Rec. H2612 (daily ed. Mar. 31, 1976) (statement of 

Rep. Thompson) ........................................................................ 7, 51

FEC Advisory Op. 2010-09, http://saos.nictusa.com/aodocs/AO 2010-09

.pdf (July 22, 2010) ............................................................ 11, 12, 32

FEC Advisory Op. 2010-11, http://saos.nictusa.com/aodocs/AO 2010-11

.pdf (July 22, 2010)......................................................................... 11

FEC Statement on Carey v. FEC: Reporting Guidance for Political 

Committees that Maintain a Non-Contribution Account, 

http://www.fec.gov/press/Press2011/20111006postcarey.shtml 

(Oct. 5, 2011).................................................................................. 12

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U.S. Const. art. III..................................................................................... 28

Federal Rule of Civil Procedure 12(b)(6)........................................... 18, 23

Tom Van Riper, The Wal-Mart Squeeze, Forbes (Apr. 24, 2007), 

http://www.forbes.com/2007/04/23/walmart-suppliers-margins-leadcx_tvr_0423walmart.html......................................................................... 54

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GLOSSARY

FEC = Federal Election Commission

FECA = Federal Election Campaign Act

J.A. = Joint Appendix

SSF = Separate Segregated Fund

STI = Stop This Insanity, Inc.

STI Fund = Stop This Insanity, Inc. Employee Leadership Fund

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COUNTERSTATEMENT OF JURISDICTION

The district court had jurisdiction over this action under 28 U.S.C. § 1331 

and entered judgment granting the Federal Election Commission’s motion to 

dismiss on November 6, 2012. Appellants’ notice of appeal was timely filed on 

January 2, 2012. This Court has jurisdiction over the appeal pursuant to 28 U.S.C. 

§ 1291.

COUNTERSTATEMENT OF ISSUE PRESENTED

Whether appellant Stop This Insanity, Inc. — a corporation that has an 

undisputed right to finance unlimited electoral advocacy directly and subject to 

disclosure requirements — also has a constitutional right to finance such electoral 

advocacy indirectly through an accounting device that enables it to conceal the 

sources of some political spending from the public and to make undisclosed 

solicitations to the general public for unlimited contributions to fund such electoral 

advocacy.

STATUTES AND REGULATIONS

The relevant statutes are set forth in the addendum to appellants’ brief and 

supplemented herein in the attached supplemental addendum. 

COUNTERSTATEMENT OF THE CASE

This appeal presents an as-applied challenge to the provisions of the Federal 

Election Campaign Act (“FECA” or “Act”), 2 U.S.C. §§ 431-457, that govern 

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separate segregated funds (“SSF”), a special type of political committee “to be 

utilized for political purposes by a corporation, labor organization,” and certain 

other organizations. 2 U.S.C. § 441b(b)(2)(C). Stop This Insanity, Inc. (“STI”), 

together with its president, Todd Cefaratti; its SSF, Stop This Insanity, Inc. 

Employee Leadership Fund (“STI Fund”); and two unaffiliated, would-be 

contributors to STI Fund, Ladd Ehlinger and Glengary, LLC, challenge FECA’s 

limits on contributions to SSFs. They also attack the statutory restrictions on 

solicitations by corporations for contributions to the SSFs. STI wishes to establish 

for STI Fund a separate account — called a non-contribution account — and solicit 

unlimited contributions from the general public for it. STI would then use funds 

from STI Fund’s non-contribution account to pay for independent election 

expenditures. 

 Seeking approval to open such a non-contribution account and fund it in this 

manner, STI Fund requested an advisory opinion from the Commission in early 

2012. The Commission considered two draft responses to the request. Neither 

draft garnered four or more affirmative votes, however, and the Commission was 

thus unable to render an opinion. Plaintiffs filed suit in July. In November 2012, 

the district court denied plaintiffs’ motion for a preliminary injunction and granted 

the Commission’s motion to dismiss. The court held that the First Amendment did 

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not require that plaintiffs be allowed to establish a non-contribution account for an 

SSF and fund it with unlimited contributions solicited from the general public. 

COUNTERSTATEMENT OF THE FACTS

I. Statutory and Regulatory Background

A. Separate Segregated Funds

The Federal Election Campaign Act prohibits a corporation such as STI 

from contributing its general treasury funds to any federal candidate, political 

party, or political committee. See 2 U.S.C. § 441b(a); see generally FEC v. 

Beaumont, 539 U.S. 146 (2003) (upholding constitutionality of section 441b(a)). 

This prohibition encompasses not only direct monetary contributions, but also a 

corporation’s giving of any “indirect payment . . . , any services, or anything of 

value.” See 2 U.S.C. § 441b(b)(2). 

In addition, until the Supreme Court issued its decision in Citizens United v. 

FEC, 558 U.S. 310 (2010), FECA prohibited corporations from using their general 

treasury funds to finance any political expenditure. 2 U.S.C. § 441b(a). As 

codified, this prohibition encompassed “independent expenditures,” which are 

communications that expressly advocate the election or defeat of a federal 

candidate and are not made in coordination with a candidate or political party. See

2 U.S.C. § 431(17). It also included “electioneering communications,” which are 

“broadcast, cable, or satellite communication[s]” that (a) refer to a clearly 

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identified federal candidate, and (b) are broadcast in the area where the candidate is 

seeking election within 60 days before the general election or 30 days before a 

primary election or convention. 2 U.S.C. §§ 441b(b)(2), 434(f)(3)(A)(i). 

FECA, however, permits a corporation to establish and administer a separate 

political account, defined as a “separate segregated fund to be utilized for political 

purposes by [the] corporation.” 2 U.S.C. §§ 431(4)(B), 441b(b)(2)(C).1

 A 

corporation can solicit contributions to its SSF, see 2 U.S.C. § 441b(b)(4); 

11 C.F.R. § 114.5(g), and the corporation can make contributions to candidates and 

political parties with the funds the SSF receives in response to such solicitations. 

See 11 C.F.R. § 114.5(f).2

 

Before the Supreme Court’s decision in Citizens United, SSFs provided the 

only mechanism through which corporations could make “expenditures” such as

electioneering communications and independent expenditures for communications 

that expressly advocate for or against federal candidates. See 2 U.S.C. 

§ 441b(b)(2); FEC v. Nat’l Right to Work Comm. (“NRWC”), 459 U.S. 197, 201 

 1 Separate segregated funds, inter alia, are referred to colloquially as 

“political action committees” or “PACs.” Citizens United v. FEC, 558 U.S. at 321. 

2 The FECA provisions and FEC regulations relating to corporate election 

activity also generally apply to labor unions. For example, like corporations, labor 

unions may not make direct contributions, 2 U.S.C. § 441b(a), but may establish 

SSFs, 2 U.S.C. § 441b(b)(2)(C). Because no labor union is a party to this case, the 

Commission’s brief focuses almost exclusively on corporations and corporate 

SSFs. But the arguments advanced here would apply equally to union-sponsored 

SSFs. 

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(1982) (explaining that SSFs were created to enable limited participation of unions 

and corporations in federal elections); District Court Opinion at 11 (J.A. 223) 

(same).

In Citizens United, the Court struck down FECA’s prohibition on 

corporation-funded independent campaign advocacy as a violation of the First 

Amendment. 558 U.S. at 365-66. The Court held that the governmental interest in 

preventing corruption and its appearance is inapplicable to independent advocacy 

of candidates. Id. at 356-61. Thus, the Court held that corporations have a 

constitutional right to spend their general treasury funds on independent 

expenditures for or against candidates. Id. at 365-66. At the same time, however, 

the Court noted that the government has an important interest in preventing 

corruption and that banning direct corporate contributions to candidates reduces 

the opportunity for actual and apparent corruption. See id. at 345. 

As the district court recognized, although “SSFs continue to be a mechanism 

through which the beneficial owners and employees of a corporation can band 

together to make direct contributions to candidates and political parties, which 

corporations are still prohibited from doing directly under the FECA and First 

Amendment jurisprudence[,] . . . corporations no longer need SSFs to engage in 

unlimited independent expenditures with general treasury funds.” (District Court 

Opinion at 11-12, J.A. 223-24 (citations omitted).) “The Supreme Court 

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eliminated this dependency in Citizens United by allowing corporations themselves 

(rather than just their constituent members, officers, employees, etc.) to engage in 

unlimited independent political expenditures.” (Id. at 12, J.A. 224.) 

B. Regulation of SSFs and Nonconnected PACs

FECA regulates SSFs in many of the same ways it regulates independent 

political committees that are not established by a corporation (“nonconnected

PACs”). For example, both SSFs and nonconnected PACs must register with the 

FEC and periodically file public disclosure reports. 2 U.S.C. § 434(a); 11 C.F.R. 

§ 114.5(e)(3). In these reports, both SSFs and nonconnected PACs must provide 

certain information regarding each of their “contributions” and “expenditures,” i.e., 

the funds they receive and spend. 2 U.S.C. § 434(b). And FECA limits 

contributions to both SSFs and nonconnected PACs to $5,000 per contributor per 

year. 2 U.S.C. § 441a(a)(1)(C); 11 C.F.R. § 114.5(f). 

Because SSFs were contemplated by FECA specifically to “permit[] some 

participation of unions and corporations in the federal electoral process,” NRWC, 

459 U.S. at 201, there are two significant differences between the statutory 

provisions governing SSFs and those governing nonconnected PACs. First, as an 

exception to the ban on corporate contributions (and to the former ban on corporate 

expenditures), an SSF may have the entire costs of its “establishment, 

administration, and solicitation” paid directly by the SSF’s sponsoring corporation. 

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2 U.S.C. § 441b(b)(2)(C); 11 C.F.R. § 114.5(b). These corporate payments are 

statutorily excluded from FECA’s definitions of “contribution” and “expenditure,” 

so SSFs need not identify such payments in their reports to the Commission or 

otherwise disclose them to the public. See 2 U.S.C. §§ 431(8)(B)(vi), (9)(B)(v), 

434(b); 11 C.F.R. § 114.5(e)(1). Nonconnected PACs, by contrast, have no 

sponsoring corporation, so they publicly disclose all contributions they receive and 

disbursements for their administrative and solicitation costs above the statutory 

thresholds. See 2 U.S.C. § 434(b)(3), (5). 

Second, to address Congress’s concerns about the inherently coercive nature 

of employee solicitations and limit the ability of corporations to pressure 

employees to contribute to their SSFs, FECA places greater restrictions on 

solicitations for contributions to SSFs than on solicitations by nonconnected PACs. 

See 122 Cong. Rec. H2612 (daily ed. Mar. 31, 1976) (statement of Rep. 

Thompson) (J.A. 91) (explaining anti-coercion purpose of SSF solicitation 

restrictions); Pls.’ Prelim. Inj. Mem. at 4 n.1, J.A. 91 (same). FECA’s legislative 

history reflects Congress’s concern that employee solicitations, “no matter for what 

purpose, and no matter how well-intentioned, are psychologically coercive . . . 

because the entity soliciting the funds is, for all practical purposes, the same as, or 

closely related to the one which also gives the salary raises and promotions.” 122 

Cong. Rec. H2612 (daily ed. Mar. 31, 1976) (statement of Rep. Thompson); see 

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also 122 Cong. Rec. S3700 (daily ed. Mar. 17, 1976) (statement of Sen. Bumpers) 

(Even when there is not “overt pressure to either give or you will not have a job 

next week . . . the pressure will be there, and that troubles me.”). 

In addition, while nonconnected PACs can solicit contributions from 

virtually any individual or organization, but see infra n.3, SSFs generally may 

solicit contributions only from a “restricted class” of corporate employees, i.e., 

their connected corporations’ owners and salaried executives (and those owners’ 

and executives’ families). See 2 U.S.C. § 441b(b)(4)(A)(i); 11 C.F.R. 

§§ 114.1(j), 114.5(g)(1). There is a limited exception allowing an SSF to solicit 

from its connected corporation’s non-executive employees, but such solicitations 

may be conducted only twice per year, and only pursuant to detailed statutory and 

regulatory provisions that limit the coercive effect of a corporation asking its 

employees to give it money. See 2 U.S.C. § 441b(b)(4)(B) (providing that 

solicitation can be made “only by mail addressed to . . . employees at their 

residence and . . . so designed that the corporation . . . cannot determine who 

makes a contribution of $50 or less . . . and who does not make such a 

contribution”); 2 U.S.C. § 441b(b)(3)(B)-(C) (requiring solicitations of employees 

to inform each employee “of the political purposes of such fund at the time of such 

solicitation” and “of his right to refuse to so contribute without any reprisal”); 

11 C.F.R. § 114.6. An SSF cannot solicit contributions from the general public, 

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i.e., anyone other than the sponsoring corporation’s owners, executives, and 

employees. See 2 U.S.C. § 441b(b)(4)(A)(i); 11 C.F.R. § 114.5(g)(1). “The effect 

of this [provision] is to limit solicitation by . . . corporations to those persons 

attached in some way to it by its corporate structure.” NRWC, 459 U.S. at 202.

C. “Super PACs,” “Non-Contribution Accounts,” and Disclosure

Although Citizens United struck down the prohibition on corporate financing

of independent speech, the Court upheld FECA’s requirement that all corporationfunded electioneering must be disclosed to the Commission and the public. The 

Court upheld the FECA provision mandating disclosure of funds used to finance 

any communication broadcast in the relevant jurisdiction that mentions a federal 

candidate in the period leading up to an election. See Citizens United, 558 U.S. at 

366-71. 

Eight Justices agreed that disclosure is “less restrictive” than a limit on 

spending, id. at 369, and is a constitutionally permissible method of furthering the 

public’s important interest in knowing who is responsible for pre-election 

communications about candidates, see id. at 368-71. As the Court explained, 

“[t]he First Amendment protects political speech; and disclosure permits citizens 

and shareholders to react to the speech . . . in a proper way. This transparency 

enables the electorate to make informed decisions and give proper weight to 

different speakers and messages.” Id. at 371. 

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Following Citizens United, this Court held that FECA’s $5,000 limit on 

contributions to PACs was unconstitutional as applied to a nonconnected PAC that 

spent its funds only on independent advocacy and was funded only by individual 

contributions. SpeechNow.org v. FEC, 599 F.3d 686 (D.C. Cir. 2010) (en banc). 

The Court found that such nonconnected PACs present no more risk of corrupting 

officeholders through independent expenditures than do corporations; thus,

FECA’s $5,000 contribution limit was not supported by a sufficiently important

governmental interest. See id. at 693-95. 

To “be clear,” the Court noted, the constitutional questions were decided 

only “as applied to contributions to SpeechNow, an independent expenditure-only 

group.” Id. at 696. And, consistent with Citizens United, this Court affirmed the 

constitutionality of mandatory disclosure of political spending “based on a 

governmental interest in ‘provid[ing] the electorate with information’” about the 

sources of election-related funds. Id. at 696 (quoting Buckley v. Valeo, 424 U.S. 1, 

66 (1976)). The Court therefore held that the government can constitutionally 

require all PACs — including those exempt from limits on the contributions they 

receive — to report all of their income and spending, “no matter whether the 

[funds] were [given] towards administrative expenses or independent 

expenditures.” Id. at 698. After Citizens United and SpeechNow, therefore, the 

state of the law is that corporations are permitted to spend unlimited funds to 

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finance independent campaign advocacy, and individuals are permitted to make 

unlimited contributions to nonconnected PACs that make only independent 

expenditures — with all such unlimited spending and giving subject to disclosure 

requirements. 

The Commission subsequently issued an advisory opinion determining that 

these cases, when read in tandem, necessarily meant that both corporations and 

individuals have a constitutional right to pool their money together to finance 

independent expenditures. See FEC Advisory Op. 2010-11 (Commonsense Ten),

2010 WL 3184269 (July 22, 2010). The Commission therefore found that a 

nonconnected PAC that makes only independent expenditures — not contributions 

to candidates — can accept unlimited contributions from both corporations and 

individuals. Id. at *1-*2. These PACs have come to be known as “super PACs.” 

The Commission similarly found, in a separate advisory opinion issued the 

same day, that corporations have the right to establish and administer super PACs. 

See FEC Advisory Op. 2010-09 (Club for Growth), 2010 WL 3184267, at *3 (July 

22, 2010) (“Club for Growth Advisory Opinion”). Such corporation-established 

super PACs are not SSFs, id. at *4, so they are not prohibited from soliciting the 

general public for contributions to SSFs, id. at *3-*4, and do not enjoy the SSF 

exemption from disclosing the sponsoring corporation’s payments for the 

“establishment, administration, and solicitation” of the super PAC. See 2 U.S.C. 

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§ 441b(b)(2)(C); 11 C.F.R. § 114.5(b); Club for Growth Advisory Opinion, 2010 

WL 3184267, at *4. 

Following the Commission’s issuance of these advisory opinions, a district 

court considered the question of whether a nonconnected PAC that makes both 

contributions and independent expenditures has a constitutional right to establish 

two bank accounts: one for accepting limited individual contributions for making 

contributions to candidates, and one for accepting unlimited contributions to 

finance the PAC’s independent expenditures and certain other independent election 

activity. See Carey v. FEC, 791 F. Supp. 2d 121 (D.D.C. 2011). Ultimately, the 

Commission entered into a consent judgment and then adopted a policy permitting 

nonconnected PACs that make contributions to candidates to maintain a separate 

bank account containing unlimited individual and corporate contributions for 

financing independent expenditures. See FEC Statement on Carey v. FEC: 

Reporting Guidance for Political Committees that Maintain a Non-Contribution 

Account, http://www.fec.gov/press/Press2011/20111006postcarey.shtml (Oct. 5, 

2011). Such unlimited accounts are known as “non-contribution accounts” 

because nonconnected PACs cannot make contributions from them. See id.

In sum, a nonconnected PAC now can (1) make contributions to candidates 

using funds contributed by individuals within FECA’s contribution limits, and 

(2) finance independent expenditures from a separate non-contribution account that 

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is generally exempt from contribution restrictions.3 Similarly, a corporation can 

(1) make contributions to candidates from its SSF, which can accept only 

individual contributions subject to FECA’s contribution limits, and (2) finance 

unlimited independent expenditures directly or through a super PAC, which is not 

subject to FECA’s contribution limits but which is subject to the Act’s disclosure 

requirements. 

II. Factual Background and Procedural History

A. The Parties

The Federal Election Commission is the independent agency of the United 

States with exclusive jurisdiction over the administration, interpretation, and civil 

enforcement of FECA, 2 U.S.C. §§ 431-457, and other federal campaign-finance 

provisions. The Commission is empowered to “formulate policy” with respect to 

the Act, 2 U.S.C. § 437c(b)(1); “to make, amend, and repeal such rules . . . as are 

necessary to carry out the provisions of [the] Act,” 2 U.S.C. §§ 437d(a)(8), 

438(a)(8),(d); and to issue written advisory opinions, 2 U.S.C. §§ 437d(a)(7), 437f. 

Appellant Stop This Insanity, Inc. is a non-profit corporation incorporated in 

Arizona that has sought formal recognition of its status as a “social welfare” 

organization. Compl. ¶ 18, J.A. 10; see 26 U.S.C. § 501(c)(4). Earlier, in March 

 3 Foreign nationals, government contractors, national banks and corporations 

organized by authority of any law of Congress cannot contribute to such separate 

accounts. 2 U.S.C. §§ 441b, 441c, 441e.

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2010, STI had registered with the Commission as a nonconnected PAC.4 From 

March through September of that year, STI raised over $470,000 in contributions 

and spent approximately $215,000.5

 On October 20, 2010, STI rescinded its 

registration as a political committee and ceased filing financial disclosure reports 

with the Commission.6

 STI alleges that it “has no interest in financing independent 

expenditures.” (Compl. ¶ 12, J.A. 9.)

Appellant Stop This Insanity Inc. Employee Leadership Fund is STI’s 

separate segregated fund. (Compl. ¶ 17, J.A. 10.) STI Fund registered with the 

Commission as an SSF in January 2012, but as of December 31, 2012, the date of 

STI Fund’s latest report to the Commission, it had received no contributions and 

had an account balance of $0.7

 STI wishes to make contributions to candidates 

through STI Fund (Compl. ¶ 23, J.A. 11), and to establish a non-contribution 

account within STI Fund that would accept unlimited individual and corporate 

contributions, including from the public, to finance independent expenditures (id. 

 4 STI, FEC Form 1, 

http://query.nictusa.com/pdf/131/10030264131/10030264131.pdf (March 9, 2010). 

All of STI’s FEC filings can be viewed at http://query.nictusa.com/cgibin/fecimg/?C00478024.

5 STI, FEC Form 3X, 

http://query.nictusa.com/pdf/001/10931540001/10931540001.pdf (Oct. 16, 2010).

6 Letter from Dan Backer, Esq., to FEC Office of General Counsel, 

http://query.nictusa.com/pdf/390/10030482390/10030482390.pdf (Oct. 20, 2010).

7 STI Fund, FEC Form 3X,

http://images.nictusa.com/pdf/723/13960375723/13960375723.pdf (Dec. 31, 

2012).

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¶ 28, J.A. 12-13). Appellants allege that STI Fund would like to solicit 

contributions of unlimited amounts from STI’s executives and from individuals 

and corporations unaffiliated with STI. (Id.) They further allege that STI Fund

would like to solicit contributions from STI’s non-executive employees “as 

provided under 2 U.S.C. § 441b(b)(4)(B).” (Compl. ¶ 77, J.A. 23; see also id. ¶ 9, 

J.A. 7-8; id. Prayer for Relief ¶ 3, J.A. 24.) STI intends to pay directly for all or 

some of STI Fund’s administrative and solicitation expenses. (See Compl. ¶¶ 12, 

23; J.A. 9, 11.)

Appellant Todd Cefaratti is the president of STI. (Compl. ¶ 19; J.A. 10.) He 

would like to contribute $10,000 to STI Fund to finance its independent 

expenditures. (Id. ¶ 26, J.A. 12.) Appellant Ladd Ehlinger is not formally 

affiliated with STI but would like to “support” its independent expenditures, and 

STI would like to solicit him for contributions to STI Fund. (Id. ¶ 27, J.A. 11-12.) 

Appellant Glengary, LLC is a corporation incorporated in Arizona that would like 

to contribute $10,000 to STI Fund to finance independent expenditures. (Id. ¶¶ 20, 

25, J.A. 11.)

B. The Advisory Opinion Request

On January 4, 2012, STI Fund requested an advisory opinion from the 

Commission. (Compl. Exh. A., J.A. 30-34.) This request sought approval of the 

proposed solicitation and acceptance of unlimited contributions into a nonUSCA Case #13-5008 Document #1437756 Filed: 05/23/2013 Page 28 of 81
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contribution account without being subject to the restrictions on SSF solicitations 

in 2 U.S.C. § 441b(b)(4)(A)(i) and (b)(4)(B). (Id. at 4, J.A. 34.)

The Commission considered two draft responses to STI Fund’s request. 

Draft A (J.A. 41-57) would have approved the request and permitted the

solicitation of contributions from the general public to a non-contribution account

of STI Fund. (Id. at 48, 53-55.) The draft, however, also would have maintained 

the statutory restrictions on SSF solicitations to STI’s non-executive employees 

because those restrictions serve an important governmental interest — preventing 

employee coercion — that no judicial opinion has called into question. (Id. at 50-

51.)

Draft B would have concluded that neither the holdings nor the rationales of 

this Court’s decisions in EMILY’s List v. FEC, 581 F.3d 1 (D.C. Cir. 2009) and 

SpeechNow, 599 F.3d 686, or the district court’s preliminary-injunction ruling in 

Carey, 791 F. Supp. 2d 121 — all of which addressed nonconnected PACs —

mandated allowing SSFs to operate non-contribution accounts. (See J.A. 59-71.) 

This draft noted that the statutory disclosure exemption for corporate payments 

covering STI Fund’s solicitation expenses, when combined with its intention to 

solicit funds from the general public, would mean that significant corporate 

political spending would go undisclosed if the SSF could operate a noncontribution account. (See id. at 65, 69.) 

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On March 1, 2012, three FEC Commissioners voted to adopt Draft A and 

three voted to adopt Draft B. (J.A. 73.) Because the affirmative vote of four 

Commissioners is required for the Commission to render an advisory opinion, 

2 U.S.C. §§ 437c(c), 437d(a)(7), the Commission was unable to render an opinion 

on the request. (J.A. 73.)

C. District Court Proceedings

STI and the other appellants filed this suit on July 10, 2012. (J.A. 4-25.) 

They claim a constitutional right to finance unlimited electoral advocacy indirectly 

through STI Fund in a manner that would conceal from the public STI’s payments 

to facilitate such political spending and also enable STI to finance undisclosed 

solicitations to the general public for unlimited contributions to fund such electoral 

advocacy. They filed their motion for a preliminary injunction on July 18, 2012. 

(J.A. 79-81.) 

First, appellants challenged the constitutionality of the contribution limits in 

2 U.S.C. § 441a(a)(1)(C) as applied to SSFs that make both direct contributions 

and express advocacy communications. (J.A. 18-22.) Second, they challenged the 

constitutionality of the Act’s restrictions on solicitations in U.S.C. § 441b(b)(4) as 

applied to SSFs that make both direct contributions and express advocacy 

communications. (J.A. 23.) As explained supra at pp. 7-9, the solicitation

provision generally prohibits SSFs from soliciting contributions from persons other 

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than the connected organization’s stockholders and its executive or administrative 

personnel, with limited exceptions for non-executive employees. The complaint 

sought declaratory relief regarding the as-applied constitutionality of the 

contribution limits in sections 441a(a)(1)(C), 441a(a)(3) and the solicitation 

restrictions in section 441b(b)(4)(A)(i) (see J.A. 23-24), and preliminary and 

permanent injunctions enjoining the Commission’s enforcement of those 

provisions against appellants (see J.A. 24).

On September 25, 2012, the Commission filed a motion to dismiss under 

Federal Rule of Civil Procedure 12(b)(6). The district court granted that motion 

and denied appellants’ motion for a preliminary injunction in an opinion issued on 

November 5, 2012. (J.A. 213-53.)

D. District Court Opinion

In the district court’s November 5 opinion, the court held that Citizens 

United and its progeny did not compel the relief plaintiffs sought: for corporate 

SSFs to be permitted to maintain accounts not subject to FECA’s source and 

amount limitations or solicitation restrictions for SSFs, nor subject to the 

disclosure requirements for payments of administrative and solicitation expenses. 

(J.A. 221.) The district court emphasized as “critical” the fact that “this is a case 

about regulating the solicitation and fundraising activities of ‘connected’ SSFs —

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PACs that are established, administered, and subsidized by corporations,” and that 

“have unique characteristics.” (J.A. 221 (emphasis added).) 

The court pointed out that the requested relief “is completely unnecessary to 

allow the plaintiffs to engage in unlimited independent expenditures, individually 

or together. Rather, this case narrowly touches upon the particular accounting 

mechanism through which the plaintiffs may make those expenditures.” (J.A. 

224.) The court discussed the statutory exemptions for disclosure of a sponsoring 

corporation’s financing of its SSF’s establishment, administration, and solicitation 

costs, and found that the relief sought by the plaintiffs-appellants, if granted, 

“would create such a large loophole in political committee disclosure requirements 

that those requirements would be meaningless.” (J.A. 223.) 

The court also analyzed FECA’s restriction of “the universe of people the 

SSF may solicit” (J.A. 222), and concluded that the solicitation restrictions 

applicable to SSFs are narrowly drawn to further the government’s important 

interest in protecting the First Amendment rights of corporate employees: “The 

danger that rank-and-file employees would be exposed to repeated public 

solicitations from their employer’s PAC . . . and would thereby feel coerced to 

contribute or adopt a particular political viewpoint at work[] represents an 

unacceptable risk of infringing those employees’ First Amendment rights.” (Id. at 

248-49 (footnote omitted).)

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The court concluded that the challenged statutory requirements for SSFs are 

constitutional and, after considering the remaining preliminary-injunction factors,

denied the plaintiffs’ motion for preliminary injunction and granted the 

Commission’s motion to dismiss.

8

 (Id. at 253.)

SUMMARY OF ARGUMENT

STI seeks to have the Court assume a legislative role and establish a new 

form of political committee that would be subject to a novel regulatory scheme 

never contemplated or intended by Congress. Specifically, STI seeks to finance 

independent expenditures and solicitations for such expenditures through a

purported SSF that would maintain a non-contribution account not subject to 

FECA’s provisions regulating contributions to and solicitations by a corporation’s 

SSF. The prospective entity would also not be compliant with FECA’s disclosure 

requirements for contributions to and solicitations by every other type of political 

committee, including nonconnected committees that finance independent 

expenditures. The district court correctly held that the First Amendment conveys 

no such right.

None of the challenged statutory provisions imposes any burden on STI’s

right to engage in unlimited political advocacy. Indeed, the only burdens at issue 

in the case are those that STI seeks to impose on itself. STI seeks to eschew the 

 8 The district court’s opinion is available at Stop This Insanity, Inc. Employee 

Leadership Fund v. FEC, 2012 WL 5383581 (D.D.C. Nov. 5, 2012), J.A. 213-53.

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direct means of financing corporate political advocacy approved by the Supreme 

Court in Citizens United in favor of an even more complicated version of the SSF 

mechanism that the Citizens United Court deemed a “burdensome alternative[]” 

means of “mak[ing] [the corporation’s] views known regarding candidates and 

issues in a [political] campaign.” 558 U.S. at 337-39. But STI has no 

constitutional right to repurpose its SSF in a manner wholly inconsistent with the 

function and purpose for which Congress created such funds. Nor does STI have a 

constitutional right to evade the disclosure requirements applicable to other 

political committees. All of the cases upon which appellants purport to rely

involve nonconnected PACs, which are materially different from SSFs. The 

district court thus correctly found that Citizens United and its progeny did not 

compel the relief that plaintiffs sought. (J.A. 221.)

STI seeks to evade provisions of the Act that further the important 

governmental interests of disclosing the funding of campaign speech under the 

applicable intermediate-scrutiny standard. If granted the requested relief, STI 

would be able to conceal all of its payments to STI Fund to finance the SSF’s 

administrative and solicitation expenses. And there is no limit on how much STI 

may spend in making those undisclosed payments. In other words, STI could

spend limitless sums to communicate STI Fund’s fundraising message to any 

individual or corporation without disclosing that STI paid for those solicitations or 

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how much it spent doing so. Funding such communications through a super PAC 

rather than an SSF as STI demands would not permit such concealment. STI’s 

proposed disclosure-avoidance mechanism contravenes the government’s 

important interest in disclosure of electoral advocacy, which this Court and the 

Supreme Court have recognized permits the public to know the sources and 

financing of the electoral messages to which they are subjected. 

The proposed non-contribution account would also undo FECA’s 

solicitation restrictions, which further the governmental interest in preventing 

corporations from coercing their employees and others into making unlimited 

political contributions. Such provisions, which prohibit SSFs from soliciting 

contributions from the general public and restrict the nature and scope of 

solicitations to the connected corporation’s employees, address the inherently 

coercive nature of a corporation asking its employees to give money. As with the 

disclosure provisions, the Commission and the courts are bound to give the anticoercion provisions regarding solicitations full effect. 

Finally, the district court’s dismissal of this case rendered moot appellants’ 

preliminary-injunction motion. But even if the Court nevertheless considers that 

motion in the context of this appeal, the district court properly denied the request 

for preliminary injunctive relief and certainly did not abuse its discretion in doing 

so. The district court correctly held that appellants had failed to meet any of the 

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preliminary injunction factors. Not only do their claims lack merit, appellants 

suffered no cognizable harm, let alone irreparable harm, during the pendency of 

this case. STI has always been and remains free to finance independent 

expenditures directly or through a super PAC.

Moreover, the district court correctly held that the balance of equities and 

public interest weighed against enjoining enforcement of the challenged 

provisions. The presumption of constitutionality that adheres to Congressional acts 

— especially those already upheld by the Supreme Court — counseled against 

issuance of a preliminary injunction. So did the public interest, which favored the 

continuing enforcement of the provisions at issue, provisions that form a critical 

part of the Act’s regulation of separate segregated funds.

STANDARD OF REVIEW

This Court reviews a district court’s order granting a motion to dismiss de 

novo. Carter v. Washington Metro. Area Transit Auth., 503 F.3d 143, 145 (D.C. 

Cir. 2007). A complaint is properly dismissed under Rule 12(b)(6) if it fails to 

“state a claim to relief that is plausible on its face.” Ashcroft v. Iqbal, 556 U.S. 662, 

678 (2009). “Factual allegations, although assumed to be true, must still ‘be 

enough to raise a right to relief above the speculative level.’” Hettinga v. United 

States, 677 F.3d 471, 476 (D.C. Cir. 2012) (quoting Bell Atl. Corp. v. Twombly, 

550 U.S. 544, 555 (2007)). The court, however, “need not accept inferences drawn 

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24

by plaintiff if those inferences are not supported by the facts set out in the 

complaint, nor must the court accept legal conclusions cast as factual allegations.” 

Id.

ARGUMENT

I. THE FIRST AMENDMENT DOES NOT REQUIRE THE

GOVERNMENT TO PERMIT THE MECHANISM APPELLANTS 

SEEK TO USE TO FINANCE INDEPENDENT CAMPAIGN 

ADVOCACY

Separate segregated funds are a statutorily created exception to FECA’s 

corporate-contribution ban, which is not challenged here (and to the Act’s 

unenforceable prohibition of corporate political expenditures financed with a 

corporation’s general treasury funds). Unlike nonconnected PACs, which are 

independent, SSFs serve the unique function of “mak[ing] [their connected 

corporation’s] views known regarding candidates and issues in a [political] 

campaign,” where such views are (or were) otherwise not permitted to be 

expressed directly. Citizens United, 558 U.S. at 339. 

The challenged provisions regulating contributions to and solicitations for 

SSFs serve important governmental interests, particularly in light of the special 

role that SSFs play in facilitating the political activities of their connected 

corporations. Connected corporations may pay for their SSFs’ administrative and 

solicitation costs, and such payments need not be publicly disclosed. But those 

undisclosed payments necessarily relate only to internal matters because, 

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consistent with their distinctive function of expressing the political views of their 

connected corporations, SSFs are not permitted to solicit the general public. 

Similarly, in view of the inherently coercive nature of a corporation soliciting 

political contributions from its employees, FECA restricts the nature and scope of 

solicitations for contributions from employees to SSFs. 

Today, SSFs still serve an important role in facilitating otherwise prohibited 

corporate contributions to federal candidates. But in the context of independent 

expenditures, which corporations now can finance directly with unlimited amounts 

of general treasury funds, or indirectly through unlimited contributions to 

nonconnected super PACs, “SSFs have become vestiges of a bygone world of 

campaign finance” law. (J.A. 223.)

Appellant STI thus has the right to spend unlimited sums of its general 

treasury funds to finance independent expenditures and solicitations for such 

expenditures directly. STI also has an unrestricted right to spend unlimited sums 

to pay for, inter alia, the administrative and solicitation costs of a nonconnected

super PAC that, in turn, could solicit and spend unlimited sums on independent 

expenditures. All such spending for administration and solicitation for a super PAC 

must, however, be disclosed. 

Through this lawsuit, STI conceives a new form of political committee that 

would be subject to a novel regulatory scheme never contemplated or intended by 

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Congress. Specifically, STI seeks to finance independent expenditures and 

solicitations for such expenditures through a purported SSF non-contribution 

account. That account would not be subject to FECA’s provisions regulating 

contributions to and solicitations by a corporation’s SSF, nor compliant with 

FECA’s disclosure requirements for contributions to and solicitations by political 

committees, including those that finance independent expenditures. The district 

court correctly held that the First Amendment conveys no such right.

A. Appellants Have No Constitutional Right to Repurpose STI Fund

in a Manner that Fundamentally Contravenes the Role SSFs 

Actually Play in FECA’s Regulatory Scheme

This entire lawsuit is premised on a fundamental misunderstanding of the 

function and purpose of separate segregated funds. Contrary to appellants’ 

assertion, SSFs are not indistinguishable from nonconnected PACs; they are not 

“simply collections of individuals grouping together to engage in political speech” 

(Brief of Appellants (“Br.”) at 19), and an SSF cannot “choose[] to organize itself” 

(id. at 18). Instead, SSFs are established by corporations, and they are a statutory 

exception to FECA’s corporate-contribution ban and its former prohibition on

financing corporate political expenditures with general treasury funds. 

The Act explicitly authorizes the establishment of SSFs “to be utilized for 

political purposes by a corporation.” 2 U.S.C. § 441b(b)(2)(C) (emphasis added). 

Unlike other political committees, SSFs are — as the district court correctly 

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explained (J.A. 250) — statutory creatures of connected organizations that directly 

or indirectly establish, administer, or financially support the SSF. 2 U.S.C. 

§ 431(7) (“‘connected organization’ means any organization [not a political 

committee] which directly or indirectly establishes, administers, or financially 

supports a political committee”); id. § 441b(b)(4)(A)(i) (referring to “a separate 

segregated fund established by a corporation”) (emphasis added). The SSF 

mechanism permits the sponsoring corporation to solicit individual contributions 

to its SSF, so that the sponsoring corporation can use its SSF to contribute to 

candidates and political committees. Thus, as its name makes clear, the purpose of 

an SSF is to serve as a “fund” of “segregated” money for the sponsoring 

corporation to finance what would otherwise be prohibited corporate political 

contributions. The Supreme Court recognized as much in Citizens United, 

observing that SSFs then served as the only mechanism by which a corporation 

could “make its views known regarding candidates and issues in a [political] 

campaign.” 558 U.S. at 339 (emphasis added).

By definition, no SSF can ever exist apart from the corporation’s desire to 

engage in such spending, and the corporation can exercise complete control over 

how its SSF’s funds are spent. In contrast with nonconnected committees,

[t]he separate segregated fund may be completely controlled by the 

sponsoring corporation or union, whose officers may decide which 

political candidates’ contributions to the fund will be spent to assist. 

The ‘fund must be separate from the sponsoring union [or 

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corporation] only in the sense that there must be a strict segregation of 

its monies’ from the corporation’s other assets. 

NRWC, 459 U.S. at 200 n.4 (citing Pipefitters Local Union No. 562 v. United 

States, 407 U.S. 385, 414-417, (1972) and Buckley v. Valeo, 424 U.S. 1, 28 n.31 

(1976)). 

In sum, SSFs “operate differently than non-connected committees” 

(Appellants’ Br. at 8), and thus they are materially different from the nonconnected

committees at issue in every case relied upon by appellants. Though STI may have 

chosen to establish STI Fund as a separate legal entity, STI Fund is literally just 

that — a “fund” administered and controlled by STI. See Pipefitters, 407 U.S. at 

414 (“[A] fund must be separate from the sponsoring union only in the sense that 

there must be a strict segregation of its monies from union dues and 

assessments.”). Indeed, STI’s very presence in this lawsuit belies appellants’ 

characterization of this case: If it were true that all that is at issue here is STI 

Fund’s independent activity, unrelated to STI’s activity, STI would seem to lack 

any injury-in-fact that could be redressed here, i.e., it would have no Article III 

standing to bring this suit. Am. For Safe Access v. DEA, 706 F.3d 438, 453 (D.C. 

Cir. 2013) (“Article III standing has three elements: ‘(1) injury-in-fact, (2) 

causation, and (3) redressability.’”); cf. Schenley Distillers Corp. v. United States, 

326 U.S. 432, 435 (1946) (holding that parent corporation had no standing to 

challenge agency order denying wholly owned subsidiary’s application for a 

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permit and explaining that “parent is adequately represented . . . by the subsidiary 

whose conduct of the litigation it controls”). 

Appellants are thus wrong in arguing that “[t]he district court improperly 

distinguished SSFs from other political committees.” (Br. at 30.) FECA and 

various court decisions leave no doubt as to the fundamental distinctions between 

SSFs and nonconnected PACs, and it is appellants who improperly seek to conflate

the two.

B. The Challenged Statutory Provisions Impose No Burden on STI’s 

Ability to Engage in Unlimited Independent Political Advocacy

In Citizens United, the Supreme Court held that financing corporate 

expenditures through an SSF was a “burdensome alternative[]” means of 

“mak[ing] [the corporation’s] views known regarding candidates and issues in a 

[political] campaign.” 558 U.S. at 337-39. The Court thus struck the ban on direct 

corporate financing of political expenditures. Id. at 338. As a result, corporations 

like STI are no longer required to finance their political expenditures through their 

SSFs. 

In light of this reality, appellants’ characterization of this case as a 

constitutional challenge regarding the rights to solicit and spend unlimited 

individual and corporate contributions is misleading. STI already can, consistent 

with existing law, do exactly that — solicit funds from individuals in the general 

public, political committees, corporations, and labor organizations in order to 

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directly finance its independent expenditures. See Citizens United, 558 U.S. at 

364-66; supra pp. 5-6. In other words, and as the district court correctly 

explained, “the relief sought by the plaintiffs in the instant action is completely 

unnecessary to allow the plaintiffs to engage in unlimited independent 

expenditures.” (J.A. 224.) 

Contrary to appellants’ hyperbole, the available means of financing STI’s 

political speech are not unconstitutionally burdensome. The only burdens on 

political expenditures at issue in this case are those that STI seeks to impose on 

itself by financing its advocacy indirectly through an accounting mechanism that is 

more onerous than the direct means that is already available for financing such 

advocacy but which requires public disclosure that STI apparently wishes to 

avoid.9

 In other words, here it is appellants, not the Commission, that seek “[t]he 

availability of avenues ‘more burdensome’” (Br. at 24) than those already 

available. 

 9 Equally erroneous is Appellants’ argument that limiting STI Fund’s 

solicitations to STI’s “tiny” restricted class presents a constitutionally significant 

“burden” on STI Fund’s ability to “raise sufficient funds.” (Br. at 9-10, 42.) That 

argument is noncognizable on its face, for the Supreme Court has explicitly 

rejected consideration of the “‘ancillary interest in equalizing . . . relative financial 

resources’” in political campaigns. Davis v. FEC, 554 U.S. 724, 738 (2008) 

(quoting Buckley, 424 U.S. at 54). Neither the Commission nor the Court is 

empowered to bend the rules to help small groups compete with larger ones. 

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In light of STI’s undisputed right to finance independent expenditures itself, 

the issue here is not whether STI can obtain the funds to finance its activities but 

only how. STI may prefer to repurpose its SSF in a disclosure-avoiding and 

coercion-enhancing manner that contravenes the legislative purpose for which 

Congress created such funds. See supra pp. 26-29. But it has no constitutional 

right to do so. To the contrary, the First Amendment issues implicated by this case 

are the governmental and public interest in disclosure of the sources and financing 

of political messages to which the public is subjected. See, e.g., Citizens United, 

558 U.S. at 368 (“At the very least, . . . disclaimers avoid confusion by making 

clear that [communications] are not funded by a candidate or political party.”); 

Buckley, 424 U.S. at 82 (holding that disclosure “further[s] First Amendment 

values by opening the basic processes of our federal election system to public 

view”); Survival Education Fund (“SEF”) v. FEC, 65 F.3d 285, 296 (2d Cir. 1995) 

(quoting Buckley, 424 U.S. at 82, and explaining that disclaimer requirements for 

solicitations “serve[] important First Amendment values” and that such 

requirements for solicitations are “a reasonable and minimally restrictive method 

of ensuring open electoral competition that does not unduly trench upon 

[individuals’] First Amendment rights”) (internal quotation marks omitted). The 

district court also correctly found that this case implicates the First Amendment 

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rights of STI’s employees not to be coerced into contributing to STI Fund. (J.A. 

247-48.)

Moreover, to the extent STI wishes to solicit and accept unlimited 

contributions to finance political expenditures indirectly, rather than directly with 

its treasury funds, it may legally do this as well, by directing unlimited 

contributions to a super PAC under its control.10 See supra p. 10-12. Whether it 

finances political expenditures and solicitations directly with treasury funds or 

through a super PAC, however, STI’s financing of solicitations and other PAC 

expenses must be disclosed. 

Appellants’ arguments regarding the purported burdens of operating a super 

PAC are undermined by STI’s own experience. Appellants broadly argue (Br. at 

25) that the “[d]etailed record-keeping and disclosure obligations, along with the 

duty to appoint a treasurer and custodian of the records” may create a disincentive 

to speak and impose onerous administrative costs. But this is an as-applied 

challenge, and STI has already proven that it is eminently capable of doing all of 

 10 Appellants purport to object to a “[r]equir[ement] [that] the Leadership Fund 

. . . clone itself to make independent expenditures” (Br. at 24), but the Commission 

has never suggested that STI Fund or any other SSF should — or could — create a 

second entity or account to finance independent expenditures. To the contrary, that 

is appellants’ argument. To the extent STI seeks to avoid financing such 

expenditures directly, the Commission’s advisory opinions would permit STI to 

create a second entity to do so and to pay its administrative costs, and there is no 

allegation here that STI lacks the funds to pay such costs. See Club For Growth 

Advisory Opinion, 2010 WL 3184267, at *3; supra p. 14 (noting that STI raised 

more than $470,000 in just seven months between March and September of 2010). 

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that. From March through September of 2010, while registered as a nonconnected

PAC, STI raised over $470,000 in contributions and spent approximately $215,000 

— all of which STI duly reported to the Commission. (See supra p. 14 & n.5.) 

Moreover, since rescinding its registration as a political committee, STI created 

STI Fund and appointed a treasurer and custodian of records for the Fund. (See

J.A. 35-38.) A super PAC established by STI would have the same organizational 

and disclosure requirements with which STI has already complied in the context of 

STI Fund. STI has thus demonstrated that it would be able to operate a super PAC, 

undermining its allegations regarding the purported burdens associated with 

establishing and operating such a political committee. See SpeechNow, 599 F.3d at 

697 (rejecting as “a specious interpretation of the facts” SpeechNow’s claimed 

burden to organize and report as a super PAC where record reflected SpeechNow’s 

ability to comply with most of challenged requirements). Because STI has 

demonstrated no burden, its challenge should be rejected.

C. The Challenged Provisions Are Subject to Intermediate Scrutiny 

If appellants had articulated some burden, the relevant standard for a 

constitutional challenge would be intermediate scrutiny. The provisions regulating 

contributions to and solicitations for SSFs at issue are not, as appellants argue (Br.

at 31, 40-43), subject to strict scrutiny. 

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In Buckley v. Valeo, 424 U.S. 1 (1976) — which appellants nowhere cite in 

their discussion of the applicable standard — the Supreme Court imposed a 

“lower” level of scrutiny on contribution limits than on expenditure restrictions. 

The Court held that it was appropriate to apply a lesser standard to contribution 

limits because such limits primarily implicate First Amendment rights of 

association, not expression, and contributors remain able to vindicate their 

associational interests in other ways. Id. at 20-25. Numerous decisions since 

Buckley have confirmed and applied that standard.11 

Appellants nonetheless assert (Br. at 32) that the limits on contributions to 

SSFs that make independent expenditures are, in effect, restrictions on SSFs’ 

expenditures and should thus be subject to strict scrutiny. Courts have already

found this line of argument devoid of merit. First, in McConnell, appellants 

asserted that because the Bipartisan Campaign Reform Act (“BCRA”), Pub. L. No. 

107-155, 116 Stat. 81 (2002), banned national party committees from raising or 

spending “soft-money” contributions above FECA’s “hard-money” contribution 

limits in 2 U.S.C. § 441a, the statute’s soft-money ban essentially functioned as an 

 11 See, e.g., Randall v. Sorrell, 548 U.S. 230, 247, 253 (2006) (plurality 

opinion) (examining “whether . . . contribution limits are ‘closely drawn’ to match 

the State’s interests”); McConnell v. FEC, 540 U.S. 93, 136 (2003) (holding that 

contribution limit is constitutional if “closely drawn to match a sufficiently 

important interest”) (internal quotation marks omitted); FEC v. Beaumont, 539 

U.S. 146, 162 (2003) (same); Republican Nat’l Comm. v. FEC, 698 F. Supp. 2d 

150, 156 (D.D.C.) (three-judge court) (citing McConnell, Beaumont, and Buckley), 

aff’d, 130 S. Ct. 3544 (2010).

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expenditure restriction for constitutional purposes. See McConnell, 540 U.S. 

at 138 (construing 2 U.S.C. § 441i(a)). The Court unambiguously rejected that 

argument, noting that contribution limits do not “in any way limit[ ] the total 

amount of money parties can spend. Rather, they simply limit the source and 

individual amount of donations.” Id. at 138-39. 

This argument was again raised before a three-judge court in RNC v. FEC, 

698 F. Supp. 2d 150 (D.D.C. 2010) (three-judge court), aff’d mem., 130 S. Ct. 

3544 (2010). The court rejected that attempt:

To be sure, every limit on contributions logically reduces 

the total amount that the recipient of the contributions 

otherwise could spend. But the [Supreme] Court has 

stated that this truism does not mean limits on 

contributions are simultaneously considered limits on 

expenditures that therefore receive strict scrutiny. . . . 

Plaintiffs contend that [soft-money] contribution limits 

will function as expenditure limits when applied to their 

proposed conduct. But that argument flies in the face of 

McConnell, which squarely held that the level of scrutiny 

for regulations of contributions to candidates and parties 

does not turn on how the candidate or party chooses to 

spend the money or to structure its finances. 

Id. at 156.

Moreover, nothing in Citizens United, 558 U.S. 310, or any case since, has 

suggested that contribution limits are subject to anything more demanding than 

intermediate scrutiny. In Citizens United, the Court repeatedly and explicitly 

distinguished the government’s interest in limiting contributions, which were not at 

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issue in that case, from independent political expenditures, which were. See, e.g., 

id. at 359 (“[C]ontribution limits . . . unlike limits on independent expenditures, 

have been an accepted means to prevent quid pro quo corruption.”), 360-61 (“The 

BCRA record establishes that certain donations to political parties, called ‘soft 

money,’ were made to gain access to election officials. This case, however, is 

about independent expenditures, not soft money.”). 

Intermediate scrutiny is also the proper standard for reviewing the 

challenged solicitation rules. The Supreme Court in McConnell v. FEC held that 

soft-money solicitation restrictions “have only a marginal impact on political 

speech” and the Court accordingly upheld such restrictions after reviewing them 

under the “less rigorous scrutiny applicable to contribution limits.” 540 U.S. 93, 

137-42 (2003).12 In addition, as the Supreme Court in Citizens United recently 

reiterated, the Court’s earlier decision in NRWC held “that a restriction on a 

corporation’s ability to solicit funds for its segregated PAC, which made direct 

contributions to candidates, did not violate the First Amendment.” 558 U.S. at 358

(citing NRWC, 459 U.S. at 206). That holding controls the outcome here. 

Although the court below ultimately declined to decide the level of scrutiny 

applicable to the challenged solicitation rules (J.A. 245), it correctly relied on the 

 12 Before McConnell, this Court had expressed uncertainty regarding the 

applicable level of scrutiny of a solicitation rule. See Blount v. SEC, 61 F.3d 938, 

942-43, 947-48 (D.C. Cir. 1995) (declining to determine level of scrutiny because 

challenged solicitation rule satisfied even strict scrutiny). 

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Supreme Court’s decision upholding the constitutionality of such requirements in 

NRWC (J.A. 247), and cited the Court’s recognition in McConnell that a standard 

“less than strict scrutiny” applies to solicitation restrictions, which “‘in no way 

alter[] or impair[] the political message ‘intertwined’ with the solicitation.’” (J.A. 

244 (quoting McConnell, 540 U.S. at 138-39).) The district court also correctly 

concluded that “the solicitation restrictions [at issue here] appear to be content 

neutral because they are ‘justified without reference to the content of the regulated 

speech,’” (J.A. 244-45), i.e. to further the government’s compelling and important 

interests in disclosure and preventing coercion of corporate employees. See supra

p. 19.

Appellants invoke various inapposite cases to summarize (Br. at 41-42) a 

continuum of constitutional scrutiny for issues ranging from solicitations to engage 

in unlawful behavior to commercial solicitations and false advertising claims under 

the Lanham Act. But none of appellants’ purported authorities regarding the 

proper standard of scrutiny for solicitations even mentions the regulation of SSF 

solicitations.13 Nor do any of those cases address, let alone cast doubt on, 

 13 In Village of Schaumburg v. Citizens for a Better Environment, the Court 

appropriately recognized that solicitations may include “persuasive speech seeking 

support for . . . particular views on political . . . issues,” 444 U.S. 620, 632 (1980), 

but it did not review a solicitation requirement under strict scrutiny — i.e., 

whether the provision was narrowly tailored to serve a compelling interest. 

Although the Schaumburg Court did not categorize the level of constitutional 

scrutiny it was applying, its analysis was consistent with intermediate scrutiny. 

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Congress’s interest in preventing the coercion of employees by corporations or 

labor organizations soliciting political funds.

Finally, Citizens United makes clear that appellants’ attempt to evade 

disclosure requirements is likewise subject to intermediate scrutiny: Whether there 

is “a ‘substantial relation’ between the disclosure requirement and a ‘sufficiently 

important’ governmental interest.” 558 U.S. at 366-67 (quoting Buckley, 424 U.S. 

at 64, 66). This is similar to the “lesser demand” that applies in constitutional 

challenges to contribution limits. Beaumont, 539 U.S. at 162; see also Republican 

Nat’l Comm. v. FEC, 698 F. Supp. 2d 150, 156 (D.D.C.) (three-judge court), aff’d 

mem., 130 S. Ct. 3544 (2010). 

Appellants erroneously argue that their challenge involves expenditure limits 

that would implicate strict scrutiny. See Citizens United, 558 U.S. at 364-66

(striking down corporate expenditure limit). Clearly it does not.

II. THE CHALLENGED STATUTORY PROVISIONS FURTHER THE 

IMPORTANT GOVERNMENTAL INTEREST OF DISCLOSING 

THE FUNDING OF CAMPAIGN SPEECH

In a single, oblique reference buried in the middle of their appellate brief, 

STI Fund admits that it is seeking to “organiz[e] in a way that allows them to 

receive operating expenses from another organization without disclosing the 

 

See id. at 636-39 (discussing the “substantial governmental interests” and 

“legitimate interests” at issue, and determining whether they were “sufficiently 

served,” were “narrowly drawn,” and bore a “substantial relationship” to the 

regulation). 

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amount of operating expenses they receive.” (Br. at 26.) Appellants ignore the 

additional disclosure-evasion STI would accomplish by financing solicitations on 

behalf of STI Fund without disclosing itself as the financial source of such 

communications. See infra pp. 41-43. There is no constitutional right to conceal 

such political spending. To the contrary, Citizens United, SpeechNow, and other 

recent campaign-finance decisions could not have made clearer the 

constitutionality of mandatory disclosure requirements in the context of political 

spending and advocacy. See, e.g., Doe v. Reed, 130 S. Ct. 2811, 2820 (2010) 

(upholding — in the context of ballot initiatives — disclosure requirements, which 

“promote[] transparency and accountability in the electoral process to an extent 

other measures cannot”); Citizens United, 558 U.S. at 369 (holding that 

government’s “informational interest alone is sufficient” to justify mandatory 

disclosure for campaign-related speech); SpeechNow, 599 F.3d at 698 (upholding 

disclosure requirements for super PACs “no matter whether the [funds] were 

[given] towards administrative expenses or independent expenditures”). 

Far from violating the First Amendment, campaign-finance disclosure 

requirements further the important governmental interest of disclosing the funding 

of campaign speech and protect the related First Amendment rights of the public to 

know the identity of those who seek to influence their vote. Citizens United, 558 

U.S. at 369-71 (“[D]isclosure permits citizens and shareholders to react to 

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[political] speech . . . in a proper way. This transparency enables the electorate to 

make informed decisions and give proper weight to different speakers and 

messages.”); SEF, 65 F.3d at 296 (explaining that solicitation disclaimer 

requirements “serve[] important First Amendment values” and are a constitutional 

method of “ensuring open electoral competition that does not unduly trench upon 

[individuals’] First Amendment rights”). 

A. Appellants’ Proposed Relief Would Enable Corporations to 

Conceal Campaign-Related Spending

As conceived by FECA, the disclosure exemption for corporate payments of 

an SSF’s costs is narrow. An SSF need not report payments for its “establishment, 

administration and solicitation” paid directly by its sponsoring corporation, in this 

case STI. 11 C.F.R. § 114.5(b), (e)(1). Before Citizens United, a corporation 

could lawfully engage in electoral spending only through its SSF, and the SSF 

could solicit funds only from its sponsoring corporations’ executives, stockholders, 

and employees. Thus, the permissible corporate spending covered by FECA’s 

exemption for administration and solicitation expenses involved only internal 

matters, i.e., the SSF’s solicitations from already-affiliated individuals, plus its 

overhead. None of that undisclosed spending paid for communications sent to the 

public.

This lawsuit, however, seeks to have the statutory disclosure exemption 

swallow the rule, which it would do in two distinct ways. 

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First, under the SSF non-contribution account mechanism proposed here, 

STI could communicate its fundraising message to — and seek unlimited political 

contributions from — nearly any individual or organization in America on behalf 

of STI Fund without disclosing that STI paid for those solicitations or how much 

money it spent doing so. The distribution of such undisclosed solicitations is 

manifestly irreconcilable with the narrow scope of the statutory SSF exemption, 

which applies only to internal communications, and with FECA’s disclosure 

provisions, which require PACs to disclose every dollar they spend and the source 

of those dollars. 2 U.S.C. § 434(b)(4). 

Appellants omit the fact that their requested relief will result in STI paying 

for undisclosed solicitations of the general public — communications that can 

themselves support or oppose federal candidates — or the damage that could 

result. Under STI’s theory, the corporation could have solicited hundreds of 

thousands of people to contribute to STI Fund during the months leading up to the 

November 2012 election by urging them to donate unlimited funds to STI Fund as 

a way to (in the words of STI’s website) “stand up to Obama” because “[u]nder 

Obama . . . a perjuring felon ‘allegedly’ is leading the DOJ.” (FEC Opp’n to 

Prelim. Inj., J.A. 148) (quoting STI's website, http://act.theteaparty.net/5507/standUSCA Case #13-5008 Document #1437756 Filed: 05/23/2013 Page 54 of 81
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up-to-obama/; http://act.theteaparty.net/5273/prosecute-eric-holder/).)14 The 

financing mechanism that plaintiffs seek would render a solicitation containing 

language like this (and others) entirely exempt from the disclosure rules applicable 

to every other PAC engaging in similar electoral advocacy.

In contrast, if STI were to finance such solicitations directly, or to do so 

through a super PAC — as it is currently permitted to do (see supra pp. 11-12

(discussing Club for Growth Advisory Opinion)) — appellants could conduct all of 

their desired activities, and there would be no disclosure evasion. STI could spend 

as much as it wishes for its super PAC’s administrative and solicitation expenses, 

and the super PAC could solicit the general public for unlimited individual and 

corporate contributions to finance independent expenditures — i.e., it could do 

everything appellants claim they want to do through the proposed SSF noncontribution account. The only difference would be that STI’s payments in support 

of the super PAC would be disclosed to the public.

Citizens United squarely contradicts any notion of a constitutional right to 

finance campaign advocacy in the proposed indirect and disclosure-evading 

manner. Eight Justices agreed in that case that mandatory disclosure of electionrelated funding is a constitutionally permissible method of furthering the public’s 

 14 There is, of course, no doubt that STI has the constitutional right to make 

statements such as these in the context of soliciting contributions; the only question 

is whether STI can do so in a way that avoids disclosing who paid for the 

solicitation.

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important interest in knowing who is financing campaign speech. 558 U.S. at 368-

71. The Court therefore upheld FECA’s disclosure requirements even as applied to 

political communications that contained no candidate advocacy but rather “only 

pertain[ed] to a commercial transaction,” i.e., soliciting the public to buy a DVD 

that criticized a candidate. Id. As the Court explained, the government’s 

“informational interest alone is sufficient,” to justify mandatory disclosure for such 

campaign-related speech because “[t]he First Amendment protects political speech; 

and disclosure permits citizens and shareholders to react to the speech . . . in a 

proper way. This transparency enables the electorate to make informed decisions 

and give proper weight to different speakers and messages.” Id. at 369, 371. 

Citizens United thus puts to rest any argument that STI has a constitutional right to 

avoid disclosing its payments for political solicitations: If the government can 

constitutionally mandate disclosure of who paid to advertise a DVD critiquing a 

candidate, the government can a fortiori mandate disclosure of payments to solicit 

funds for the purpose of advocating the election or defeat of a candidate.

Second, as appellants admit (Br. at 26), their plan would enable STI to avoid 

triggering the broad disclosure requirements applicable to political committees. 

Under FECA, a group whose major purpose is electing or defeating federal 

candidates must register with the Commission as a political committee and report 

all of its income and expenses once it makes $1,000 in expenditures or receives 

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$1,000 in contributions. See 2 U.S.C. § 431(4)(A); Buckley, 424 U.S. at 79. STI 

apparently seeks to avoid these registration and disclosure requirements by 

spending its political funds on its SSF, such that STI’s spending would not 

constitute a contribution or an expenditure that would trigger the $1,000 threshold 

for political committee status. 

STI’s proposed avoidance is irreconcilable with SpeechNow’s upholding of 

FECA’s disclosure requirements as applied to independent-expenditure-only 

PACs. In SpeechNow, the en banc D.C. Circuit relied upon Citizens United in 

unanimously affirming the constitutionality of requiring so-called “super PACs” to 

disclose all of their income and expenses. See 599 F.3d at 696-98. The court held 

that these requirements further “the public . . . interest in knowing who is speaking 

about a candidate and who is funding that speech,” and that PAC disclosure “deters 

and helps expose violations of other campaign finance restrictions, such as those 

barring contributions from foreign corporations or individuals.” Id. at 698. 

Accordingly, these governmental interests “are sufficiently important . . . to justify 

requiring [an independent-expenditure-only committee] to organize and report to 

the FEC as a political committee.” Id; see also Nat’l Org. for Marriage v. McKee, 

649 F.3d 34, 58-59 (1st Cir. 2011), cert. denied, 132 S. Ct. 1635 (2012) (upholding 

PAC disclosure in light of government’s “interest in the dissemination of 

information regarding the financing of political speech”). 

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In light of SpeechNow’s conclusive and binding determination, there is no 

merit to appellants’ claim that the First Amendment requires the government to 

recognize an unnecessary and more burdensome method of financing political 

advocacy that would facilitate STI’s evasion of disclosure obligations applicable to 

all other PACs.15

B. There Is No Legal Basis for Permitting STI to Evade FECA’s 

Disclosure Provisions 

Appellants fail to identify a single court decision requiring the outcome they 

seek. Nor can they. As the district court and both of the draft advisory opinions 

considered by the Commission recognized, “none of the recent judicial decisions

issued in the realm of campaign finance and the First Amendment directly address 

whether FECA’s contribution limits and solicitation restrictions are constitutional 

as applied to an SSF.”16 (J.A. 217 (citing Compl. Exh. B at 7; id. Exh. C at 6-7).) 

 15 The fact that the Supreme Court in Citizens United and this Court in 

SpeechNow upheld disclosure requirements as, inter alia, furthering the public’s 

interest in knowing who is financing campaign speech belies appellants’ sweeping 

claim (Br. at 13) that after Citizens United campaign finance regulations related to 

disclosure must prevent apparent or actual quid pro quo corruption.

16 Appellants contend that the district court’s decision was “grounded in a 

dissent” and inaccurately argue that it “[t]hus . . . should be reversed.” (Br. at 4.) 

To the contrary, regardless of the views expressed in the district court’s dicta (see 

id. (citing J.A. 235)), the lower court explicitly recognized that “[i]t is of course 

not the Court’s prerogative to question the authority of [Citizens United, 

SpeechNow, or EMILY’s List],” and its dismissal of the complaint in this case was 

grounded in the court’s analysis of those decisions and the conclusion that “the 

implications of Citizens United and its progeny do not compel the relief the 

plaintiffs seek.” (J.A. 221.) Appellants are plainly wrong to suggest that the 

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Indeed, none of the cases upon which appellants rely even discusses the rights of 

corporations to finance independent expenditures through an SSF non-contribution 

account, let alone considers the purported right to raise unlimited funds in a 

manner that would result in evasion of the disclosure provisions upheld in Citizens 

United and SpeechNow. 

Citizens United held that corporations could pay for independent 

expenditures with general treasury funds. While the Court also held that SSFs 

were not an adequate substitute for the corporation’s own speech, 558 U.S. at 337, 

it never suggested that SSFs are a constitutionally required alternative to such 

direct corporate speech. And contrary to Appellants’ unsupported claim that 

Citizens United “eliminated distinctions between . . . ‘non-connected’ and 

‘connected’” PACs (Br. at 21), the Court in fact said nothing about such 

distinctions.

Indeed, the Citizens United Court’s limited discussion of SSFs supports the 

Commission’s arguments, not appellants’. The Court distinguished — without 

rejecting or even criticizing — its own earlier holding in NRWC “that a restriction 

on a corporation’s ability to solicit funds for its segregated PAC, which made 

direct contributions to candidates, did not violate the First Amendment.” 558 U.S.

 

district court’s citation to a nonbinding authority, such as an opinion of four 

Supreme Court justices, in the course of explaining its analysis is a basis for 

reversal. 

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at 358 (citing NRWC, 459 U.S. at 206; emphasis added). That holding controls the 

outcome here. 

The district court also correctly distinguished this Court’s decisions in 

SpeechNow and EMILY’s List and properly found that those decisions “do not 

control the outcome of the instant case.” (J.A. 237.) SpeechNow involved a 

nonconnected PAC that spent its funds only on independent advocacy and was 

funded only by individual contributions. 599 F.3d at 689, 696 (holding statutory 

limits on contributions to PACs unconstitutional only “as applied to individuals’

contributions to SpeechNow” and explicitly “decid[ing] these questions [only] as 

applied to contributions to SpeechNow, an independent expenditure-only group”). 

In that case, this Court made no mention of connected PACs or SSFs. 

EMILY’s List similarly involved only nonconnected committees. Indeed, as 

the court below noted (J.A. 237 n.21), this Court in EMILY’s List repeatedly 

emphasized that its “constitutional analysis of non-profits applies only to nonconnected non-profits,” 581 F.3d at 22 n.21 (emphasis in original); see also id. at 

8; 16 n.15 (same), while explicitly disclaiming to address the constitutionality of 

FECA as applied to SSFs. Id. at 8 n.7 (excluding “a committee established by a 

corporation” from category of entities addressed in opinion). Appellants’ assertion 

(Br. at 20) that the district court’s distinguishing of EMILY’s List “based on the 

fact that EMILY’s List was a non-connected organization . . . was error” is itself 

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erroneous. Indeed, Appellants themselves concede (Br. at 14), as they must, that 

“the holding [in Emily’s List] did not address connected committees.”17 

Each of these cases was “decided in [a] significantly different context” and 

none of them resolves the distinct issue presented here. Lyng v. Int’l Union, United 

Auto., Aerospace and Agric. Implement Workers of Am., 485 U.S. 360, 369 n.7 

(1988) (internal quotation marks omitted); see Haw. Gov’t Emp. Ass’n Local 152 v. 

Martoche, 915 F.2d 718, 726 (D.C. Cir. 1990) (“We are satisfied that [the case 

relied upon by plaintiffs] is not controlling here. The facts of that case differ in 

critical respects.”). 

Nor should any of the cases upon which appellants rely be extended here to 

nullify disclosure requirements whose constitutionality has been separately 

affirmed by higher courts.18 Appellants’ attempt to extend EMILY’s List and

 17 Also erroneous is appellants’ baseless assumption that the Court in EMILY’s 

List confined its decision to nonconnected committees “because it was issued prior 

to Citizens United.” (Br. at 14.) Given that Citizens United was pending, EMILY’s 

List explicitly addressed the effect on its holding would be if the ban on corporate 

independent expenditures were overturned, and made no reference to SSFs. 581 

F.3d at 12 n.11. Moreover, neither Citizens United nor any other decision from the 

Supreme Court or this Court purports to extend the analysis in EMILY’s List to the 

context presented here, and appellants’ unsupported declaration that such an 

extension is “natural and necessary” fails in light of the differences between 

nonconnected PACs and SSFs, as discussed above, supra pp. 26-29. 

18 See Agostini v. Felton, 521 U.S. 203, 237 (1997) (“‘[I]f a precedent of this 

Court has direct application in a case, yet appears to rest on reasons rejected in 

some other line of decisions, the [lower court] should follow the case which 

directly controls, leaving to this Court the prerogative of overruling its own 

decisions.’”) (quoting Rodriguez de Quijas v. Shearson/Am. Express, Inc., 490 U. 

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SpeechNow beyond the context of nonconnected PACs fails to account for FECA’s 

key provisions governing disclosure and coercion by SSFs — provisions that 

categorically differentiate SSFs from nonconnected PACs. For all the reasons 

discussed above, EMILY’s List, which did not address disclosure at all, 581 F.3d at 

19 n.16 (“This case does not involve reporting and disclosure obligations.”), 

cannot be extended without vitiating these provisions. 

Court decisions such as Citizens United and SpeechNow have given rise to a 

category of corporate electioneering that was not contemplated by Congress when 

it enacted FECA’s disclosure provisions. But this does not mean that the 

Commission or the Court can disregard or fail to give full effect to those 

provisions. FECA’s statutory disclosure exemption for a corporation’s spending in 

support of its SSF’s solicitation costs is unambiguously limited to solicitations of 

the owners, executives, and employees of the corporation because those are the 

only kind of solicitations that SSFs can engage in. 

Citizens United and SpeechNow have changed the rules governing corporate 

independent spending and limits on contributions to super PACs, but those 

decisions did not address the solicitation rules for SSFs. Thus, even if appellants 

believe that Congress might have enacted a broader disclosure exemption if it had 

 

S. 477, 484 (1989)); see also United States v. Danielczyk, 683 F.3d 611, 615-16 

(4th Cir. 2012), cert. denied, 1335 S. Ct. 1459 (2013) (applying Agostini principle 

and reversing district court that had extended Citizens United to strike down FECA 

provisions Supreme Court had previously held constitutional). 

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50

contemplated the legal regime post-Citizens United, such speculation cannot trump 

the actual text of the existing statute, which Congress has not amended in response 

to recent developments. Accordingly, there is no statutory basis for concluding 

that spending for solicitations to the general public should be exempt from 

disclosure; but that would be the effect if STI were to prevail on its request to 

create a non-contribution account within its SSF without being bound by the 

solicitation restrictions applicable to SSFs. 

III. FECA’s SOLICITATION RESTRICTIONS FOR SSFs FURTHER 

THE GOVERNMENTAL INTEREST OF PREVENTING 

CORPORATIONS FROM COERCING THEIR EMPLOYEES AND 

OTHERS INTO MAKING UNLIMITED POLITICAL 

CONTRIBUTIONS 

In addition to evading disclosure, Appellants’ plan would contravene the 

FECA provisions that protect corporate employees from the potentially coercive 

effect of being solicited by their employers — provisions whose constitutionality is 

not in question. FECA prohibits SSFs from soliciting contributions from the 

general public, and it places significant restrictions on solicitations directed 

towards the non-executive employees of the SSF’s sponsoring corporation. See 

supra pp. 8-9. For example, an SSF can solicit employees only (1) by mail, (2) not 

at their workplace, and (3) in such a manner that the corporation “cannot determine 

who makes a contribution of $50 or less as a result of such solicitation and who 

does not make such a contribution.” 2 U.S.C. § 441b(b)(4)(B). FECA also limits 

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51

SSFs to $5,000 per contributor per year. 2 U.S.C. § 441a(a)(1)(C); 11 C.F.R. 

§ 114.5(f). 

All agree that FECA’s employee-solicitation restrictions serve to prevent a 

corporation from levering its inherent power over its employees to coerce them 

into contributing to the corporation’s SSF. (See Pls.’ Prelim. Inj. Mem. at 4 n.1, 

J.A. 91 (citing 122 Cong. Rec. H2612 (daily ed. Mar. 31, 1976) (statement of Rep. 

Thompson)).)19 As Congressman Thompson explained:

[I]t is simply a fact that solicitations by an employer, no 

matter for what purpose, and no matter how wellintentioned, are psychologically coercive. The employee 

is going to be intimidated and coerced, because the entity 

soliciting the funds is, for all practical purposes, the same 

as, or closely related to the one which also gives the 

salary raises and promotions. 

Id.; see also 122 CONG. REC. S3700 (daily ed. Mar. 17, 1976) (statement of 

Sen. Bumpers) (Even when there is not “overt pressure to either give or you 

will not have a job next week . . . the pressure will be there, and that troubles 

me.”). These restrictions exist to protect “rank and file” employees from 

solicitations that, in the judgment of Congress, are inherently coercive. See 

Pipefitters Local Union No. 562 v. United States, 407 U.S. 385, 413-14 

 19 The three FEC Commissioners who would have otherwise granted STI 

Fund’s advisory opinion request also recognized that these provisions serve an 

anti-coercion purpose and accordingly conditioned their approval of the advisory 

opinion request upon STI Fund’s compliance with “the parameters set forth at 2 

U.S.C. § 441b(b)(4)(B) and Commission regulations.” (J.A. 51.)

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(1972) (finding that solicitation of political funds from union members is 

“inherently coercive”).

In its advisory opinion request, STI Fund sought to solicit funds “not subject 

to the restrictions of . . . 2 U.S.C. § 441b(b)(4)(B).” (J.A. 34 (emphasis added).) 

None of the Commissioners voted to approve that aspect of the advisory opinion 

request. (See J.A. 50-51 (Draft A); J.A. 62 (Draft B).) 

Now, however, appellants claim that there is no risk of coercion because STI 

Fund will simply “create general advertisements and directly solicit members of 

the general public who are not members of the restricted class.” (Br. at 47.) 

Appellants have no legal or factual support for their assurance that “[o]f course, an 

employee would not be coerced by hearing a radio advertisement, seeing an 

internet advertisement, or otherwise running across general advertising” because, 

in appellants’ view, “[i]f the employee does not want to see or hear the message, 

the employee may stop watching or listening to it.” (Br. at 47 (emphasis added).) 

To the contrary, this argument amounts to a concession that STI’s employees 

inevitably will be among those who receive STI Fund’s political messages, no 

matter appellants’ intentions, and Congress has determined that such messages are 

inherently coercive. 

Moreover, there are at least three additional ways in which the proposed 

financing mechanism would abrogate FECA’s employee-protection provisions. 

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First, FECA limits an SSF to soliciting non-executive employees twice per 

year. 2 U.S.C. § 441b(b)(4)(B). Appellants, however, appear to seek the ability to 

solicit STI’s employees for funds for contributions to STI Fund’s non-contribution 

account, while also maintaining a contribution account for which STI can solicit 

twice per year. (See Compl. ¶ 23, J.A. 11.)20 Thus, the inherently coercive 

pressure of a corporation asking its employees to give money would, in appellants’ 

scenario, necessarily be more than that which Congress has deemed maximally 

permissible. 

Second, and more significantly, FECA limits SSFs to $5,000 per contributor 

per year, so $5,000 is currently the most a corporation can ask an employee to 

give. Appellants, however, claim a constitutional right for STI and its SSF to ask 

for unlimited contributions in any solicitations to STI employees, as there are no 

limits on contributions to independent expenditure-only committees. Whatever 

coercive effect might result from asking an employee to give a legally limited 

amount, asking her to give all she can afford places a greater quantitative burden 

— well beyond the level Congress has approved. 

 20 Although Appellants’ brief here states that STI Fund “seeks only to solicit 

third parties and the general public” and that “[i]t does not seek to skirt the 

limitations on solicitations of members of the restricted class,” their complaint is 

not so limited. (Compare Br. at 15, with Compl. ¶ 23, J.A. 11 (excluding as 

recipients of proposed solicitations foreign nationals, national banks, and federal 

contractors).) 

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Third, FECA contains two anti-coercion provisions in addition to section 

441b(b)(4)(B): A corporation must inform each employee it solicits “of the 

political purposes of [the SSF]” and “of his right to refuse to so contribute without 

any reprisal.” 2 U.S.C. § 441b(b)(3)(B)-(C). STI and STI Fund have nowhere 

pledged to abide by these restrictions when soliciting for their proposed noncontribution account and so it is unclear whether they would consider themselves 

free to disregard these provisions when engaging in their otherwise unlimited and 

unrestricted employee solicitations.

 Furthermore, appellants’ planned solicitations would run afoul of FECA’s 

SSF provisions even outside the context of employees. For example, freeing SSFs 

to solicit from the general public would allow a corporation to solicit its suppliers 

to give to the corporation’s SSF. Enormous numbers of companies and individuals 

in the United States owe their livelihoods to major corporate buyers. See, e.g.,

Tom Van Riper, The Wal-Mart Squeeze, Forbes (Apr. 24, 2007), 

http://www.forbes.com/2007/04/23/walmart-suppliers-margins-leadcx_tvr_0423walmart.html. If a corporation were to solicit its suppliers for political 

contributions, the financial coercion inherent in such solicitations would be 

qualitatively and quantitatively equivalent to solicitations of employees (who are 

similarly financially dependent on the soliciting corporation). The primary 

statutory provision that prevents such coercion is section 441b(b)(4)(A)(i) — the 

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very provision that plaintiffs seek to have voided as applied to STI Fund. (Compl. 

Prayer for Relief ¶ 3, J.A. 24.)

FECA’s employee-protection provisions are unambiguous, and there is no 

case law of which the Commission is aware that suggests that the provisions are in 

any context constitutionally infirm. Appellants are wrong in suggesting that 

Emily’s List provides support for their argument (Br. at 46-47) that the solicitation 

restrictions are unconstitutional. Emily’s List did not involve solicitations by 

connected organizations, let alone solicitations directed to a corporation’s 

employees that implicated the anti-coercion concerns vindicated by the challenged 

restrictions. There is no basis in law for plaintiffs’ claims that STI Fund has a First 

Amendment right to disregard FECA’s solicitation provisions.21

 21 Appellants’ contention (Br. at 46) that the Act’s solicitation restrictions are 

superfluous or otherwise infirm because the Act also prohibits SSFs from using 

funds secured by physical force, job discrimination, financial reprisals, or any 

threats of the same, 2 U.S.C. § 441b(b)(3)(A), also fails. In Buckley v. Valeo, 424 

U.S. 1, 27-28 (1976), the Supreme Court dismissed an argument similar to 

appellants’. The Court rejected the suggestion that FECA’s contribution limits 

were unconstitutional because the government’s interest in preventing corruption 

was adequately addressed by bribery and disclosure laws: “Congress was surely 

entitled to conclude that disclosure was only a partial measure, and that 

contribution ceilings were a necessary legislative concomitant to deal with the 

reality or appearance of corruption . . . .” Id. Regarding the solicitation provisions 

at issue here, Congress was surely entitled to similarly conclude that restrictions on 

the manner of employee solicitations were necessary to prevent coercion, 

notwithstanding that the Act elsewhere forbid SSFs from spending funds gathered 

through threats and intimidation.

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Appellants’ plan to solicit employees for STI Fund’s non-contribution 

account is a thinly disguised end-run around the solicitation restrictions. That

evasion must fail because the validity of FECA’s anti-coercion provisions has 

never been called into question.22 

IV. APPELLANTS’ REQUEST FOR A PRELIMINARY INJUNCTION IS 

MOOT

Appellants ask this Court to remand this case to the district court with 

instructions to preliminarily enjoin the Commission from enforcing the provisions 

of the Act at issue here. (Br. at 16.) But the district court’s dismissal of plaintiffs’ 

claims renders their appeal of the lower court’s denial of their motion for a 

preliminary injunction moot. No meaningful preliminary relief can be provided 

because a decision on the merits necessarily renders a preliminary injunction 

 22 Appellants also challenge the district court’s conclusion that they waived 

any claim regarding section 441b(a), which prohibits SSFs from accepting, inter 

alia, contributions from corporations. (Br. at 51.) As the district court found, the 

complaint in this case does not clearly articulate the nature of any challenge to that 

provision: “the plaintiffs do not cite that provision anywhere in their three causes 

of action, and they do not say that they seek declaratory or injunctive relief from 

that provision in their prayer for relief.” (J.A. 213 n.2.) But even if appellants 

were correct that they did not waive their section 441b(a) claim, any such claim is 

encompassed within their broader request to finance unlimited independent 

expenditures through an SSF non-contribution account, which appellants chose to 

call a “Carey account.” (Br. at 52-53 (asserting that appellants’ section 441b(a) 

claim “is related to all of the other” challenges and arguing that the provision is 

unconstitutional “for the same reasons” asserted as to those other challenges).) 

Thus, the district court’s conclusion that “Citizens United and its progeny do not 

compel the relief the plaintiffs seek” fully addresses any challenge to section 

441b(a).

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superfluous and the district court’s contemporaneous ruling on the preliminary 

injunction is not properly before this Court.

The law is well settled in this circuit and elsewhere that a district court's 

ruling on the merits of an underlying claim renders moot the appeal from the denial 

of the preliminary injunction. Am. Postal Workers Union v. U.S. Postal Serv., 764 

F.2d 858, 860 n.3 (D.C. Cir. 1985) (explaining that appeal from denial of 

preliminary injunction was rendered moot by issuance of decision on the merits); 

see also, e.g., Terry v. Leblanc, 475 Fed. Appx. 514, at *1 (5th Cir. 2012) 

(unpublished opinion) (dismissing appeal of order denying preliminary injunction 

because while appeal was pending “the district court entered a final judgment 

dismissing [plaintiff’s] suit” and district court’s “entry of a final judgment 

regarding permanent injunctive relief moots any order regarding temporary 

injunctive relief”); Hankins v. Temple Univ. Health Sciences Ctr., 829 F.2d 437, 

438 n.1 (3rd Cir. 1987) (holding that “interlocutory appeal from the denial of 

[plaintiff's] motion for a preliminary injunction was rendered moot by the issuance 

of the district court's final order on the merits”). 

Nonetheless, even if this Court were to find that an appeal of the 

preliminary-injunction ruling is not moot, the district court correctly held that 

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appellants had failed to satisfy any of the preliminary-injunction factors.23 That 

decision must be affirmed unless this court finds that the district court abused its 

discretion. Davis v. Pension Benefit Guar. Corp., 571 F.3d 1288, 1291 (D.C. Cir. 

2009). 

A. The District Court Correctly Held that Appellants Suffered No 

Cognizable Harm During the Pendency of This Case

In addition to showing probable success on the merits of their case, a 

plaintiff seeking a preliminary injunction also must demonstrate a likelihood — not 

merely a possibility — that she will suffer irreparable harm without injunctive 

relief. Winter, 555 U.S. at 22. “[T]he injury must be . . . actual and not theoretical 

. . . [and] of such imminence that there is a ‘clear and present’ need for equitable 

relief . . . .” Wis. Gas Co. v. FERC, 758 F.2d 669, 674 (D.C. Cir. 1985). 

Appellants wrongly claim that all a litigant need do is allege a constitutional 

violation and “irreparable harm is established.” (Br. at 54-55.) But in order to 

meet the irreparable harm requirement, “[a] litigant must do more than merely 

allege the violation of First Amendment rights.” Wagner v. Taylor, 836 F.2d 566, 

576 n.76 (D.C. Cir. 1987) (emphasis in original) (discussing Elrod v. Burns, 427 

U.S. 347 (1976)); NTEU v. United States, 927 F.2d 1253, 1254-55 (D.C. Cir. 1991) 

 23 For the same reasons the district court properly decided the merits in favor 

of the Commission and correctly granted the Commission’s motion to dismiss, see 

generally supra Parts I-III, the court did not abuse its discretion in concluding that 

plaintiffs had failed to demonstrate a likelihood of success on the merits of their asapplied challenges. 

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(“A preliminary injunction is not appropriate . . . ‘unless the party seeking it can 

demonstrate that First Amendment interests are either threatened or in fact being 

impaired at the time relief is sought.’”) (quoting Wagner, alterations omitted). If 

plaintiffs make “no showing of irreparable injury, ‘that alone is sufficient’ for a 

district court to refuse to grant preliminary injunctive relief.” Hicks v. Bush, 397 F. 

Supp. 2d 36, 40 (D.D.C. 2005) (quoting CityFed Fin. Corp. v. Office of Thrift 

Supervision, 58 F.3d 738, 747 (D.C. Cir. 1995)).

STI and STI Fund allege that they are being harmed because they would like 

to solicit and receive unlimited contributions to finance independent expenditures. 

(See Pls.’ Mem. at 33-34; J.A. 120-21.) But as discussed supra pp. 5-6, 10-12, STI 

can do these things right now and in a manner less burdensome and less coercive 

than the one it has sued for the right to employ. Supra pp. 7-10, 50-54. Or, if STI 

for whatever reason wishes to conduct its advocacy indirectly, it can establish and 

operate a super PAC to engage in exactly the same activity. Appellants fail to 

explain why these options are in any way deficient in comparison to their preferred 

disclosure-evasion mechanism. And even if plaintiffs were to plead such a 

deficiency, it would not constitute irreparable harm, for nothing plaintiffs might 

conjure would change the fact that STI could have solicited and paid for its 2012 

election advertising without limit.

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Furthermore, plaintiffs’ purported need for urgent relief before the district 

court was belied by their delay in bringing this action. The Commission 

deadlocked on STI Fund’s advisory opinion request on March 1, 2012 —

approximately 250 days before the general election. This suit was not filed until 

July 10, more than four months after it became ripe, and less than 120 days before 

the election. Plaintiffs’ unexplained delay in filing suit casts serious doubt on the 

genuineness of their belated (and self-created) urgency. See Tenacre Found. v. 

INS, 78 F.3d 693, 695 n.2 (D.C. Cir. 1996) (finding that seven-month delay before 

filing suit “undermines any assertions that [plaintiff] will suffer irreparable harm if 

the Court does not grant preliminary injunctive relief”); cf. Charlesbank Equity 

Fund II v. Blinds To Go, Inc., 370 F.3d 151, 163 (1st Cir. 2004) (“[Plaintiff’s] cries 

of urgency are sharply undercut by its own rather leisurely approach to the 

question of preliminary injunctive relief.”).

B. The District Court Correctly Held that the Balance of Equities 

and the Public Interest Weighed Against Enjoining Enforcement 

of FECA’s Disclosure and Anti-Coercion Provisions

The balance of equities and the public interest also weighed heavily in favor 

of preserving the status quo and denying appellants’ request for extraordinary 

injunctive relief. In evaluating any request to enjoin the enforcement of a federal 

statute, “[t]he presumption of constitutionality which attaches to every Act of 

Congress is not merely a factor to be considered in evaluating success on the 

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merits, but an equity to be considered in favor of [the government] in balancing 

hardships.” Bowen v. Kendrick, 483 U.S. 1304 (1987) (Rehnquist, C.J., in 

chambers) (internal quotation marks omitted); cf. United States v. Oakland 

Cannabis Buyer’s Co-op., 532 U.S. 483, 497 (2001) (holding that “[c]ourts of 

equity cannot, in their discretion, reject the balance that Congress has struck in a 

statute” by enjoining its enforcement). That presumption is at its apex here 

because the Supreme Court has already determined that the disclosure 

requirements that plaintiffs seek to evade are constitutional. See Christian Civic 

League of Me., Inc. v. FEC, 433 F. Supp. 2d 81, 90 (D.D.C. 2006) (three-judge 

court) (“To the extent that the injunction of the proposed application of those 

provisions interferes with the execution of the statute upheld by the Supreme Court 

. . . , the public interest is already established by the Court’s holding and by 

Congress’s enactment, and the interference therewith is inherent in the 

injunction.”) (internal quotation marks omitted).24 

Given the four-month delay in bringing this case, the balance of equities 

weighs even further against an injunction. See Quince Orchard Valley Citizens 

Ass’n, Inc. v. Hodel, 872 F.2d 75, 80 (4th Cir. 1989) (“[Plaintiffs’] delay is . . . 

 24 Appellants’ invocation (Br. at 55-56) of the observation in Wisconsin Right 

to Life v. FEC that “[w]here the First Amendment is implicated, the tie goes to 

speaker, not the censor,” 551 U.S. 449, 474 (2007), assumes that which appellants 

have failed to prove, that they have suffered a deprivation of speech rights. Since 

STI’s purported First Amendment burdens are all self-imposed, see supra pp. 29-

33, there is no “tie” for this Court to resolve in appellants’ favor.

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62

quite relevant to balancing the parties’ potential harms. Since an application for 

preliminary injunction is based upon an urgent need for the protection of a 

Plaintiff’s rights, a long delay in seeking relief indicates that speedy action is not 

required.”) (internal quotation marks and brackets omitted). 

Finally, as discussed above, the disclosure and anti-coercion provisions are 

critical pieces of FECA’s SSF- and PAC-regulation regime; enabling their evasion 

would therefore substantially injure the public interest. See Christian Civic 

League, 433 F. Supp. 2d at 90; see also Real Truth About Obama, Inc. v. FEC, 575 

F.3d 342, 352 (4th Cir. 2009) (upholding denial of pre-election preliminary 

injunction), vacated on other grounds, 130 S. Ct. 2371 (2010). 

Accordingly, the district court plainly did not abuse its discretion in denying 

the motion for a preliminary injunction.

CONCLUSION

STI can lawfully solicit unlimited corporate and individual contributions to 

finance campaign advertising and it can lawfully spend unlimited sums of its 

general treasury funds to finance the administrative and solicitation costs related to 

such advertising, or even to finance such advertising itself. And STI may do all of 

those things now, in a manner that is more direct and transparent and less 

burdensome and coercive than the non-contribution SSF accounting mechanism it 

proposes. Thus, FECA does not prevent STI’s political spending or solicitations; it 

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63

merely requires that such activity be fully disclosed to the public and conducted 

without placing unduly coercive pressure on vulnerable employees. Nothing in 

Citizens United, SpeechNow, EMILY’s List, or any other case appellants cite casts 

doubt on the validity of these requirements. For these and all of the foregoing 

reasons, the Court should affirm the decision below.

Respectfully submitted,

Anthony Herman

General Counsel

aherman@fec.gov

Lisa J. Stevenson

Deputy General Counsel – Law

lstevenson@fec.gov

Kevin Deeley

Acting Associate General Counsel

kdeeley@fec.gov

Erin Chlopak

Acting Assistant General Counsel

echlopak@fec.gov

/s/ Steve Hajjar_______________

Steve Hajjar

Attorney

shajjar@fec.gov

FEDERAL ELECTION COMMISSION

999 E Street, N.W.

Washington, D.C. 20463

May 23, 2013 (202) 694-1650

USCA Case #13-5008 Document #1437756 Filed: 05/23/2013 Page 76 of 81
CERTIFICATE OF COMPLIANCE

This brief complies with the type-volume limitation of Fed. R. App. P. 

32(a)(7)(B) because the brief contains 12,810 words, excluding the parts of the 

brief exempted by Fed. R. App. P. 32(a)(7)(B)(iii).

The brief also 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 the 

brief uses the proportionally spaced typeface Microsoft Word 14-point Times New 

Roman.

/s/ Steve Hajjar_______________

Steve Hajjar

Attorney

Federal Election Commission

USCA Case #13-5008 Document #1437756 Filed: 05/23/2013 Page 77 of 81
CERTIFICATE OF SERVICE

I hereby certify that on this 23rd day of May 2013, I caused the Federal 

Election Commission’s brief in Stop This Insanity Inc., Employee Leadership Fund 

v. FEC, No. 13-5008, to be filed with the Clerk of the Court by the electronic 

CM/ECF System, thereby effectuating service on the following:

Dan Backer

DB Capitol Strategies, PLLC

2009 Pennsylvania Ave., SE

Ste. 2109

Washington, DC 20003

Tillman J. Breckenridge

Reed Smith LLP

1301 K Street, NW

Washington, DC 200052

I also certify that I caused to be served two paper copies of the 

Commission’s brief by UPS next-day delivery:

Patricia E. Roberts

Jessica L. Delaney

Bryan U. Gividen

William & Mary Law School

Appellate and Supreme Court Clinic

P.O. Box 8795

Williamsburg, VA 23187

USCA Case #13-5008 Document #1437756 Filed: 05/23/2013 Page 78 of 81
2

I further certify that I also caused the requisite number of paper copies of the 

brief to be filed with the Clerk.

May 23, 2013 /s/ Steve Hajjar_______________

Steve Hajjar

Attorney

Federal Election Commission

USCA Case #13-5008 Document #1437756 Filed: 05/23/2013 Page 79 of 81
SUPPLEMENTAL ADDENDUM 

TABLE OF CONTENTS

2 U.S.C. § 431(8)(B)(vi)................................................................... Supp. Add. 1

2 U.S.C. § 431(9)(B)(v) ................................................................... Supp. Add. 1

2 U.S.C. § 441b(b)(2)(C).................................................................. Supp. Add. 1

2 U.S.C. § 441b(b)(3)(B)-(C) ........................................................... Supp. Add. 1

 

USCA Case #13-5008 Document #1437756 Filed: 05/23/2013 Page 80 of 81
Supp. Add. 1

2 U.S.C. § 431(8)(B)(vi). The term “contribution” does not include —

(vi) any payment made or obligation incurred by a corporation or a labor 

organization which, under section 441b(b) of this title, would not constitute an 

expenditure by such corporation or labor organization; . . . .

2 U.S.C. § 431(9)(B)(v). The term “expenditure” does not include —

(v) any payment made or obligation incurred by a corporation or a labor 

organization which, under section 441b(b) of this title, would not constitute an 

expenditure by such corporation or labor organization; . . . .

2 U.S.C. § 441b(b)(2)(C). For purposes of this section and section 791(h) of Title 

15, the term “contribution or expenditure” includes a contribution or expenditure, 

as those terms are defined in section 431 of this title, and also includes any direct 

or indirect payment, distribution, loan, advance, deposit, or gift of money, or any 

services, or anything of value (except a loan of money by a national or State bank 

made in accordance with the applicable banking laws and regulations and in the 

ordinary course of business) to any candidate, campaign committee, or political 

party or organization, in connection with any election to any of the offices referred 

to in this section or for any applicable electioneering communication, but shall not 

include . . . 

(C) the establishment, administration, and solicitation of contributions to a separate 

segregated fund to be utilized for political purposes by a corporation, labor 

organization, membership organization, cooperative, or corporation without capital 

stock.

2 U.S.C. § 441b(b)(3)(B)-(C). It shall be unlawful . . . 

(B) for any person soliciting an employee for a contribution to such a fund to fail 

to inform such employee of the political purposes of such fund at the time of such 

solicitation; and 

(C) for any person soliciting an employee for a contribution to such a fund to fail 

to inform such employee, at the time of such solicitation, of his right to refuse to so 

contribute without any reprisal. 

USCA Case #13-5008 Document #1437756 Filed: 05/23/2013 Page 81 of 81