No. 13-5358

ORAL ARGUMENT HAS NOT YET BEEN SCHEDULED

IN THE

United States Court of Appeals

for the District of Columbia Circuit __________________

COMBAT VETERANS FOR CONGRESS POLITICAL ACTION COMMITTEE 

AND DAVID H. WIGGS, TREASURER

Appellants,

v.

FEDERAL ELECTION COMMISSION

Appellee.

__________________

On Appeal From the

United States District Court for the District of Columbia

in Case No. 11-2168 (CKK)

__________________

REPLY BRIEF FOR APPELLANTS COMBAT VETERANS FOR 

CONGRESS POLITICAL ACTION COMMMITEE AND DAVID H. 

WIGGS, TREASURER

_______________

PAUL D. KAMENAR DAN BACKER

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

COOLIDGE-REAGAN DB CAPITOL STRATEGIES, PLLC

 FOUNDATION 203 South Union Street, Suite 300

1629 K Street NW, Suite 300 Alexandria, VA 22314

Washington, DC 20006 (202) 210-5431

(202) 603-5397 DBacker@DBCapitolStrategies.com

Paul.Kamenar@Gmail.com

September 30, 2014 Counsel for Appellants

USCA Case #13-5358 Document #1514829 Filed: 09/30/2014 Page 1 of 30
TABLE OF CONTENTS

Page

TABLE OF CONTENTS............................................................................................i

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

GLOSSARY OF ABBREVIATIONS......................................................................iv

SUMMARY OF ARGUMENT.................................................................................1

ARGUMENT.............................................................................................................2

I. THE DISTRICT COURT INCORRECTLY REJECTED

CVFC’S CHALLENGE TO THE VALIDITY OF THE

COMMISSION’S VOTING PROCEDURE...................................................2

A. CVFC Could Not Have Raised The Defective Voting

Procedure At the Agency Level Because It Was Not

Made Aware of the Defective Votes Cast Until After

The Agency Proceedings Were Completed ..........................................2

B. Sufficiency of the Administrative Record.............................................5

C. Prejudicial and Fundamental Error .......................................................7

D. The 24-Hour No-Show, No-Vote Ballots Do Not

Constitute Affirmative Votes..............................................................11

E. Directive No. 52 Was Not Properly Promulgated...............................13

II. “BEST EFFORTS” DEFENSE AND MITIGATION OF FINES................15

III. TREASURER’S PERSONAL LIABILITY..................................................19

CONCLUSION........................................................................................................24

CERTIFICATE OF COMPLIANCE

CERTIFICATE OF SERVICE

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TABLE OF AUTHORITIES

Cases Page(s)

Am. Textile Mfrs. Inst. v. Donovan, 452 U.S. 490 (1981) .................................16, 20

Burlington Truck Lines v. United States, 371 U.S. 156 (1962)...............................16

*Chamber of Commerce of the United States v. NLRB,

879 F. Supp. 2d 18 (D.D.C. 2012) (summary judgment granted

to plaintiffs), appeal dismissed, 2013 U.S. App. LEXIS 25897

(D.C. Cir. Dec. 9, 2013).................................................................................7, 10, 11

Citizens to Preserve Overton Park v. Volpe, 401 U.S. 402 (1971) ...................16, 20

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

Cox for U.S. Senate Comm., Inc. v. FEC,

No. 03-C-3715, 2004 WL 783435 (N.D. Ill. Jan. 22, 2004)....................................18

*Esch v. Yeutter, 876 F.2d 976 (D.C. Cir. 1989).......................................................6

FEC v. Legi-Tech, Inc., 75 F.3d 704 (D.C. Cir. 1996)..............................................8

Kuhn for Congress v. FEC, C.A. No. 2:13-3337-PMD-WWD

(S.D.S.C. Aug. 22, 2014).........................................................................................19

Mack Trucks, Inc. v. EPA, 682 F.3d 87 (D.C. Cir. 2012)......................................7, 8

Milas v. United States, 42 Fed. Cl. 704, 712 (1999)..................................................7

Milner v. Dep’t of Navy, 131 S. Ct. 1259 (2011)...............................................13, 14

Turner v. Shinseki, 824 F. Supp. 2d 99 (D.D.C. 2011)............................................13

Vermont Yankee Nuclear Power Corp. v. Natural Res.

Defense Council, Inc., 435 U.S. 519 (1978)............................................................12

* Authorities chiefly relied on.

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Codes, Regulations and Rules

52 U.S.C. 30102(i) [former 2 U.S.C. 432(i)]...........................................................19

52 U.S.C. 30109(a)(2) [former 2 U.S.C. 437g(a)(2)]..........................................7, 11

*52 U.S.C. 30109(a)(4)(C)(iii)

[former 2 U.S.C. 437g(a)(4)(C)(iii)]........................................................................17

5 U.S.C. 706(2)(D)...................................................................................................14

28 U.S.C. 1331.........................................................................................................17

*11 C.F.R. 111.32 ..............................................................................................11, 12

11 C.F.R. 111.35(d) .................................................................................................10

Fed. R. Civ. Proc. 15(b)...........................................................................................13

Federal Election Commission Directive No. 10 ......................................................14

Federal Election Commission Directive No. 52 ..................................................4, 13

Other Authorities

Black’s Law Dictionary (8th ed. 2004) ...................................................................11

iii

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GLOSSARY OF ABBREVIATIONS

ABBREVIATION DEFINITION

CVFC Combat Veterans for Congress PAC

FECA Federal Election Campaign Act

OAR Office of Administrative Review

OGC Office of General Counsel

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SUMMARY OF ARGUMENT

The district court erred when it ruled that CVFC waived its claim objecting 

to the FEC’s voting procedure because it was not raised at the agency level. But 

CVFC was not made aware of the defective voting until after the purported final 

agency action and thus could not raise the claim. The court also erred when it 

ruled that it could not consider the validity of the defective agency ballots because 

the FEC failed to include them in the Administrative Record even though CVFC 

supplied them to the court. The FEC erroneously argues that its novel voting 

procedure complies with its organic statute and its own regulations requiring “four 

affirmative votes” to initiate enforcement actions by counting a Commissioner’s 

failure to return a ballot within 24 hours as an “affirmative vote.” The defective 

voting procedure does not constitute “harmless error” because it involves the 

validity of the agency’s exercise of its jurisdiction and is not a minor defect. 

The court also erred by concluding that CVFC was not entitled to have its 

fine mitigated because its conduct did not meet the criteria of FEC’s “best efforts” 

regulation excusing untimely filing of disclosure reports. Alternatively, the 

regulation was arbitrary and capricious on its face and as applied. Finally, the 

Commission’s failure to find that CVFC’s former treasurer was personally liable 

for the civil penalty because of his willful and reckless conduct in failing to file 

required disclosure reports was arbitrary, capricious and an abuse of discretion.

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ARGUMENT

I. THE DISTRICT COURT INCORRECTLY REJECTED CVFC’S 

CHALLENGE TO THE VALIDITY OF THE COMMISSION’S VOTING 

PROCEDURE

The FEC argues that the district court correctly ruled that CVFC waived its 

claim that the Commissioners’ failure to cast the statutorily required “four 

affirmative votes” to initiate the enforcement actions in this case was defective 

because CVFC failed to raise that argument at the agency level. FEC Br. at 36. 

The FEC further argues that the ballots evidencing the lack of sufficient votes in 

this case were not made part of the administrative record by the FEC and thus their 

validity could not be considered by a reviewing court. Id. at 41-42. The FEC 

further argues on the merits that this novel voting procedure found in its Directive 

No. 52 complies with the agency’s organic statute and its own regulations 

requiring “four affirmative votes” to initiate enforcement actions and was lawfully 

promulgated. Id. at 42-46. Finally, the FEC argues that even if the agency’s 

voting procedures were unlawful, it was harmless error. The FEC is wrong on all 

counts.

A. CVFC Could Not Have Raised The Defective Voting Procedure At 

the Agency Level Because It Was Not Made Aware of the Defective 

Votes Cast Until After The Agency Proceedings Were Completed

The FEC claims with a straight face that CVFC should have raised the 

defective voting procedure at the administrative level even though the agency 

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misled CVFC at the agency level by simply informing CVFC that “the FEC found 

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

434(a). JA106, 244, 351. Only after this suit was filed did the Secretary and Clerk 

to the Commission certify in the Administrate Record that the Commission 

unanimously voted 6-0 to find reason to believe a violation occurred and further 

certifying that all the Commissioners “voted affirmatively for the decision.” 

JA105. The actual votes cast were not disclosed until well after the administrative 

proceeding was completed and after this suit was filed below. This argument is 

frivolous on its face and CVFC refers the Court to its opening brief rather than 

repeat those arguments here. CVFC Br. at 20-23. The FEC has not shown that it 

has been prejudiced in any way by CVFC’s raising this argument at its earliest 

opportunity, namely within three days after the FEC reluctantly relinquished the 

ballots in this case. CVFC Amended Compl. (JA51-52). 

The FEC’s recitation of cases standing for the general proposition that 

arguments not raised at the administrative level are generally waived simply do not 

apply in a situation such as this which goes to the validity of the Commission’s 

voting procedure and the votes cast in this case. See FEC Br. at 36-38 (citing 

Coburn v. McHugh, 670 F.3d 924, 931 (D.C. Cir. 2012) and other cases). As 

CVFC noted in its opening brief, those cases relate to waiver of arguments relating 

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to the merits of the underlying proceeding that could have been raised at the 

agency level. CVFC Br. at 22-23. That is simply not the nature of the case here.

The FEC weakly responds that the validity of Directive No. 52, which 

allowed the “no-show, no-vote” procedure to count as an affirmative vote, could 

have been raised since it was a public document and could “easily be located” on 

the FEC’s website. FEC Br. at 41. In the first place, Directive No. 52 is hardly 

“easy” to find on the FEC’s website. As CVFC pointed out in its brief, which 

included screen shots of the FEC’s website in its Addendum, Directive No. 52 is 

buried in the FEC website and not found under the “Law, Regulations and 

Procedures” heading in the left margin, where the public would naturally expect 

the FEC’s procedures to be located. Nor does the link to “Directives” have a subheading in the “About the FEC” drop down menu where the FEC says Directive 

No. 52 can be “easily” found. CVFC Br. at 45, n.6; Add. 64-67. The FEC’s 

further assertion, FEC Br. at 41, that Directive No. 52 can be found by “simply 

using the site’s search function” is absurd. Inserting the words “voting 

procedures” in the search window produces some 140 documents, none of which is 

Directive No. 52. Admittedly the 19th document is the OGC Enforcement Manual 

released in June 2013, promulgated after this case was initiated, which does have a 

reference Directive No. 52. 

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Nor does the FEC believe it is necessary to provide a respondent charged 

with violating the Act with information about Directive No. 52’s unusual voting 

procedure, leaving the public to falsely believe that the Commission actually meets 

and casts votes on these matters. Secondly, as discussed infra, this “public”

document was not noticed in the Federal Register as were the FEC’s general rules 

of agency procedure. In any event, even if CVFC were aware of the existence of 

this directive, it had no reason to believe that the ballots cast in its case were not all 

affirmative ballots, as the Commission Secretary certified, as opposed to the 24-

Hour no show, no vote procedure.

B. Sufficiency of the Administrative Record

The FEC’s argument that the district court correctly rejected reviewing the 

defective balloting because the FEC failed to include those ballots in the 

administrative record is also frivolous on its face. FEC Br. at 42. Here, the voting 

ballots and documents submitted by CVFC were documents generated by the 

agency itself during the enforcement proceedings. Those voting ballots do not 

relate to the circumstances of or factual defenses to the late filing of the campaign 

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

exercise of its jurisdiction and authority. In short, the FEC is in no position to 

complain that they are prejudiced by the submission and consideration of the actual 

ballots the Commissioners used in this enforcement action. The FEC Secretary 

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“certified” that six affirmative votes were cast in each of these three administrative 

fine cases, yet only supplied a blank ballot sheet for each in the Administrative 

Record. If in fact the ballots reflecting the Commissioners’ votes were required to 

be part of the Administrative Record and not just a blank ballot, it was the FEC’s 

fault for not submitting the actual ballots to the district court along with the 

Administrative Record.

The FEC simply has no answer to any of CVFC’s case authority that stand 

for the proposition that the administrative record is not sacrosanct, but can be 

supplemented if need be and that non-record evidence may be considered when a 

challenge is brought, such as in the instant case, to “the procedural validity of [an 

agency's] action.” Esch v. Yeutter, 876 F.2d 976, 991 (D.C. Cir. 1989). See also

CVFC Br. at 25-27 (citing cases).

The FEC does not dispute CVFC’s assertion that those ballots were solely in 

the hands of the FEC and were purposely not made part of the record by the FEC 

nor made available to CVFC until after this lawsuit was filed. Yet the FEC

claimed below that these ballots should not be used to supplement the 

administrative record anyway because the ballots “are ministerial in nature and 

duplicative of the certifications.” See Backer Declaration, para. 10 (quoting email 

from FEC attorneys, June 5, 2012); JA67. The FEC cannot have it both ways. 

According to the FEC, the validity and lawfulness of the Commissioners’ vote on 

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any enforcement matter can never be challenged because the certification is 

dispositive and unrebuttable. This self-serving position should be soundly 

rejected.

C. Prejudicial and Fundamental Error

The FEC erroneously argues that CVFC “failed to demonstrate any

prejudice or harm.” FEC Br. at 50 (emphasis in original). In the first place, it can 

never be harmless error for an agency to purport to exercise its jurisdiction and 

initiate enforcement actions against parties without complying with the statutorily 

required casting of “four affirmative votes” to do so. 52 U.S.C. 30109(a)(2) 

[former 2 U.S.C. 437g(a)(2)]. The failure to comply with this statutory 

requirement for the exercise of an agency’s power is a fundamental error and 

requires remand. See Chamber of Commerce of U.S. v. NLRB, 879 F. Supp. 2d 18 

(D.D.C. 2013). This jurisdictional defect is not some “mere technical procedural 

error” as the FEC would have this Court believe. FEC Br. at 50 citing Milas v. 

United States, 42 Fed. Cl. 704, 712 (1999).

Even procedural errors such as the failure to give notice do not constitute 

“harmless error.” For example, in Mack Trucks, Inc. v. EPA, 682 F.3d 87 (D.C. 

Cir. 2012), this Court “strongly reject[ed]” the notion that the EPA’s failure to 

allow for notice and comment on an interim rule was not harmless error even when

the agency provided such notice for the pending final rule. 682 F.3d at 95. “Were 

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that true, agencies would have no use for the APA when promulgating any interim 

rules.” Id. In the same fashion, the failure to cast four affirmative votes at the 

interim “reason to believe” stage here is similarly not harmless error.

The FEC chiefly relies on FEC v. Legi-Tech, Inc., 75 F.3d 704 (D.C. Cir. 

1996) where the party challenged the FEC’s “probable cause” finding because it 

was made by a Commission whose composition included two unconstitutionally 

appointed ex officio members. But as this Court made clear, “[to] be sure, LegiTech was prejudiced, in the same manner as the NRA, when the FEC brought 

suit.” Id. at 708 (emphasis added). This Court, however, went on to determine 

whether the “degree of continuing prejudice now, after the FEC’s reconstitution 

and ratification” warrants dismissal of the FEC action against Legi-Tech. In the 

instant case, there has been no ratification by the Commission of the defective vote 

to initiate the enforcement action. While the FEC suggests that it “could have 

ratified” its determinations in this matter using a valid voting procedure, FEC Br. 

at 52, n.20, the fact of the matter is that they have not done so, despite the 

pendency of this action for over two years.1

 

1 As the FEC notes, CVFC did file a motion for reconsideration with the FEC after 

the Commission purported to make a final determination of the violations and that

the FEC “did not reopen the matter.” FEC Br. at 52, n.20. But nothing should be 

read into the FEC’s failure to reopen the matter, let alone as constituting some sort 

of ratification of the Commission’s defective votes in the case. The thrust of the 

staff recommendation was that the Commission does not have any procedure for 

reconsidering a final determination as CVFC had requested, and that alternatively 

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Moreover, it is far from certain that the FEC would ratify the invalid 

enforcement action.2

 While it is true that four of the current members of the FEC 

were members three years ago when the defective votes were cast to initiate the 

enforcement proceedings, the outcome is not “clear” as the FEC suggests that the

Commissioners would reach the same result. FEC Br. at 52. For example, even 

assuming the FEC retains its questionable Directive 52, only one member need 

object to the proposed findings (whether it be one of the two new members or even 

one of the older ones), which in turn triggers an in-person meeting of the 

Commissioners where the matter can be discussed and deliberated. The 

Commission may thus decide to take up the staff’s earlier recommendation that it 

consider that the treasurer may have been personally liable for the late reports and 

direct its General Counsel to initiate appropriate proceedings. JA 316. The 

CVFC’s request for an oral hearing was not required by the statute in any event. 

See JA17-20. 2 The FEC erroneously states that there is no reason to believe that the outcome of 

the final determinations would be different since they were made “using the CVC 

Parties’ preferred voting procedure and were unanimous.” FEC Br. at 51. These 

final determination votes are not “preferred” by CVFC since there are still 

questions about the validity of those votes with respect to whether some of them 

were lawfully signed by persons other than the Commissioner pursuant to 

Directive No. 52. Moreover, in any event, the “I approve the recommendation”

tally vote does not constitute a final determination or order to assess liability and a 

fine but simply approves a staff recommendation that the Commissioners should 

make such a final determination. In short, on its face, the Commission never did

actually issue any order as do other agencies in their respective enforcement 

actions. See CVFC Br. at 35-36.

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Commission may also decide to exercise its equitable discretion to mitigate the 

fine on the grounds that CVFC did use its “best efforts” to comply with the 

reporting requirements, since the Commission was under the wrong impression 

that the willful and reckless conduct of a committee’s treasurer could never 

constitute “best efforts” under 11 C.F.R. 111.35(d), or decide that the aggregate 

fine of $8,360 was unreasonably high under the circumstances and reduce it. 

The FEC cites no case where an enforcement action which was void ab 

initio but not ratified by a valid agency vote was later upheld by a reviewing court. 

To the contrary, in Chamber v. NLRB, supra, the district court vacated the 

rulemaking because it was the product of a statutorily defective quorum, regardless 

of whether the NLRB would most certainly have voted for the rule again on 

remand. To paraphrase the court in Chamber, until there is a remand to the FEC 

for valid voting, “the Court cannot reinstate [an enforcement action] that was 

[initiated] without the requisite [four affirmative votes] and, accordingly, in excess 

of the agency’s congressionally delegated power.” 879 F. Supp. 2d 18 at 35 

(D.D.C. 2012).

The FEC vainly attempts to distinguish the Chamber case because there, the 

FEC notes, the absent Board Member was not contacted “for his response, as is the 

agency’s usual practice” and thus, all the more so the reviewing court believed his 

silence cannot be equivalent to being “present” at the meeting, even virtually, to 

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constitute a quorum. FEC Br. at 47 citing Chamber at 28-29. In the case at bar, 

the FEC says that its “usual practice” is to have a 24-hour no objection vote and 

therefore Chamber is inapposite. FEC Br. at 48. But that assertion simply begs 

the question whether the FEC’s “usual practice” is a lawful one to begin with and 

whether it violates the statutory and regulatory requirement that the 

Commissioners cast at least “four affirmative votes” to begin an enforcement 

action. 52 U.S.C. 30109(a)(2) [former 2U.S.C. 437g(a)(2)]; 11 C.F.R. 111.32.

D. The 24-Hour No-Show, No-Vote Ballots Do Not Constitute 

Affirmative Votes

As noted in CVFC’s opening brief, there are a number of reasons why a 

Commissioner may not return his or her ballot within 24 hours, ranging from not 

receiving it in the first place, to being on vacation, or otherwise indisposed during 

that short time period. CVFC Br. at 30-31. Silence simply cannot constitute an 

“affirmative vote” to initiate enforcement action. Rather, a vote is defined as “1. 

The expression of one’s preference or opinion in a meeting or election by ballot, 

show of hands, or other type of communication . . . 4. The act of voting, usu. by a 

deliberative assembly.” Black’s Law Dictionary 1606-07 (8th ed. 2004). The

failure of a Commissioner to return his or her ballot (assuming they received it and 

reviewed it) cannot be reasonably be characterized as an “expression” of one’s 

preference on a proposal or motion that is made manifest by casting a tangible 

“ballot,” raising one’s “hand,” or other type of demonstrable “communication”

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such as a voice vote. In normal practice, the failure to cast a vote does not even 

constitute an abstention which usually requires some form of communication that 

the person is indeed present but prefers to abstain from the matter, due to a conflict 

or some other reason. Failure to make any expression on a proposal, such as was 

the case here, is usually regarded as “not present” or “not voting.”

The FEC’s claim that its “voting” procedure comports with Congress’s view 

that the administrative fine program be “streamlined” rings hallow. FEC Br. at 46. 

In the first place, the “24-Hour no objection” or silent vote procedure in Directive 

No. 52 was adopted in 2008 almost a decade after Congress enacted the fine 

procedures, suggesting that during the interim years, the Commission was quite 

capable of casting actual votes as Congress directed and as commonly utilized by 

other multi-member agencies. Second, neither Congress nor the FEC in its 

regulations, 11 C.F.R. 111.32 revised the required “affirmative vote” of four 

Commissioners to initiate enforcement action to comport with Directive No. 52. 

While as a general matter an agency is allowed to “fashion [its] own rules of 

procedure,” Vt. Yankee Nuclear Power Corp. v. Natural Res. Def. Council, Inc.,

435 U.S. 519, 542-43 (1978), it is not free to radically revise a commonly 

understood term “four affirmative votes” for the sake of expediency, let alone to do 

so in a directive that was not noticed in the Federal Register.

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E. Directive No. 52 Was Not Properly Promulgated

In its opening brief, CVFC argued that Directive No. 52, which purports to 

authorize the use of 24-Hour no-objection voting at the reason to believe stage, 

was itself unlawful both with respect to its compliance with the statute requiring 

“four affirmative votes” as well as with respect to its promulgation under the 

Sunshine Act. CVFC Br. at 41-42. The FEC argues that since CVFC’s Sunshine 

Act challenge was not alleged in its amended complaint but in CVFC’s opposition 

to the FEC’s motion for summary judgment, CVFC was therefore precluded from 

raising it below. FEC Br. at 54. But the FEC first raised the validity of Directive 

No. 52 in its motion for summary judgment defending its challenged voting 

procedure. FEC Mot. for Summary Judgment at 28. CVFC was certainly entitled 

to rebut the validity of Directive No. 52 on both substantive and procedural 

grounds. Thus, the merits of that challenge were properly before the district court 

which did not reach the issue. Alternatively, since the parties litigated the issue 

below, it could be considered as a constructive amendment of CVFC’s complaint 

under Fed. R. Civ. Proc. 15(b) (2). See Turner v. Shinseki, 824 F. Supp. 2d 99, 122 

n. 23 (D.D.C. 2011) (constructive amendments are permitted at the summary 

judgment stage). 

The CVFC all but concedes that the adoption of Directive No. 52 during a 

closed session of its public meeting violated Milner v. Dep’t of the Navy, 131 S. Ct. 

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1259 (2011) but demurs because that decision came three years after the adoption 

of the directive. FEC. Br. at 57, n.22. More importantly, these rules of voting 

procedure were not noticed in the Federal Register as was Directive No. 10 entitled 

“RULES OF PROCEDURES OF THE FEDERAL ELECTION COMMISSION 

PURSUANT TO 2 U.S.C. 437c(e).” Federal Register, 73 Fed. Reg. 5568 (Jan. 30, 

2008); Add. 52. See CVFC Br. at 42-44. Members of the public and regulated 

community should have had the opportunity to offer comments about the FEC’s 

proposal to short circuit the statutory and regulatory voting requirements, or at 

least should have been made aware of them. Even if this Court does not reach the 

merits of CVFC’s arguments challenging the pedigree of Directive No. 52, those 

arguments nevertheless further undermine the legitimacy of the directive.

* * * * *

If this Court finds that the Commission “votes” in this case did not constitute 

the requisite “four affirmative votes” to find reason to believe, or that the voting 

procedures and ballots cast were otherwise invalid, the Court should not nor need 

not reach CVFC’s other claims regarding the personal liability of the treasurer or 

the challenge to the FEC’s “best efforts” regulation and the failure to mitigate the 

fine. The Court should simply vacate the judgment below since there was no valid 

agency action to begin with. 5 U.S.C. 706(2)(D). The Court may also conclude 

that there are certain facts regarding the validity of the votes, either at the reason to 

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believe stage or the final determination stage, such as whether those votes signed 

by persons other than the Commissioner were authorized to do so under the 

narrowly proscribed procedures in Directive No. 52 or were submitted late, and 

remand to the district court to further litigate the matter.

II. “BEST EFFORTS” DEFENSE AND MITIGATION OF FINES

The lower court rejected CVFC’s claim that it was entitled to raise the “best 

efforts” defense to the finding of liability under 11 C.F.R. 111.35(b)(3), ruling that 

“the Commission concluded that, pursuant to [the best efforts] regulation, [CVFC] 

did not qualify for mitigation or reduction of their fines” JA29. The district court 

found that the Commission “bas[ed] their decision not to mitigate on this 

regulation, rather than any equitable considerations. . . .” Id. Yet the record does 

not show that the Commission “concluded” one way or another about whether 

CVFC could raise the best efforts defense and whether the Commission was aware 

it had equitable discretion to reduce the fine and decided not to exercise such 

discretion.

In that regard, there are numerous instances in the district court’s opinion 

and the FEC’s brief which asserts that the Commission considered and based their 

various decisions at the administrative level on certain factors and reasons. 

However, it is black letter law that agency actions and adjudications can only be 

upheld based on the justifications given by the agency at the time it reached its 

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decision, and not the “the post hoc rationalizations of the agency or the parties to 

[later] litigation.” Am. Textile Mfrs. Inst. v. Donovan, 452 U.S. 490, 539 (1981) 

(citing Citizens to Preserve Overton Park v. Volpe, 401 U.S. 402, 419 (1971); 

Burlington Truck Lines v. United States, 371 U.S. 156, 168-69 (1962) (“The courts 

may not accept appellate counsel's post hoc rationalizations for agency action; 

[Chenery II] requires that an agency's discretionary order be upheld, if at all, on the 

same basis articulated in the order by the agency itself”)). In that regard, there is 

little if any reason given by the Commissioners, as opposed to their counsel, as to 

why they failed to take certain actions, such as mitigating the fine or consider 

finding the treasurer personally liable. As CVFC argued in its opening brief, the 

failure of the FEC to exercise its discretion should not be construed as a considered 

decision of the FEC to affirmatively withhold relief, and that failure to act can 

itself be regarded as arbitrary and capricious.

At the outset, the Commission misrepresents CVFC’s position at the agency 

level in its brief on the issue of mitigation. The FEC asserts that CVFC 

“conceded” that its treasurer’s willful and reckless conduct did not satisfy the “best 

efforts” rule. FEC Br. at 30. Of course the reports were filed late, but the CVFC 

conceded only the former treasurer’s reckless conduct would not be able to satisfy 

the “best efforts” defense with respect to that treasurer’s personal liability. The 

record clearly shows that the Chairman of CVFC and its Assistant Treasurer went 

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to great lengths to compile the information needed for the reports and to submit 

them as promptly as possible and used its “best efforts” to comply with the 

reporting requirements. CVFC Br. at 7-8. 

The FEC also argues that the lower court should not have reached the merits 

of CVFC’s “best efforts” and mitigation of fine argument because they were not 

raised at the agency level and that it is prohibited from attacking the facial validity 

of the regulation under a petition for review filed under 52 U.S.C. 30109(a)(4)

(C)(iii) [former 2 U.S.C. 437g(a)(4)(C)(iii)]. FEC Br. at 30, n.13. This is in error. 

Captain Joseph John, the Chairman of CVFC vigorously argued at the agency level 

that CVFC 

employed [its] best efforts to obtain substantial missing information as 

quickly as humanly possible, assembled and audited that information in a 

timely manner, expending approximately 600 man hours of work, 

reconstructed the donor information in the proper electronic format, and 

fully complied with FEC Reporting requirements.

JA144. Moreover, CVFC filed an Amended Petition for Review and 

Complaint for Declaratory and Injunctive Relief and asserted jurisdiction under 28 

U.S.C. 1331, which gave the lower court jurisdiction to hear the challenge to the 

“best efforts” regulation. See JA39. But even if CVFC were liable for the late 

reports, the “best efforts” defense regulation arbitrarily precluded CVFC from 

reducing or eliminating what is otherwise an excessive and unreasonable fine.

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The FEC concedes that the “FEC’s ‘best efforts’ regulations do not 

explicitly address [CVFC’s] situation.” FEC Br. at 32-33. Yet the FEC claims that 

CVFC is somehow not entitled to raise the best efforts defense because its alleged 

failure to manage its own treasurer was “consistent with negligence, which is 

addressed [in the “best efforts” regulation] and does not qualify.” FEC Br. at 33. 

But CVFC’s alleged “negligence” was not a reason articulated in the October 12, 

2011 memo from Patricia Carmona to the Commission in assessing the fines 

against CVFC and its current treasurer. JA196-98. In any event, the FEC is wrong 

to claim, as the lower court did, that CVFC was asking the courts to exercise their 

own judgment and reduce the fine. See FEC Br. at 33 (citing Cox for U.S. Senate 

Comm., Inc. v. FEC, No. 03-C-3715, 2004 WL 783435 (N.D. Ill. Jan. 22, 2004)). 

Rather, all that CVFC is asking is that, assuming arguendo that this Court rejects 

CVFC’s challenge to the voting procedures, the case be remanded to the agency 

for the Commission to consider and exercise its discretion as to whether or not it 

should mitigate the fine under the legal or equitable authority which it has, and to 

give reasons for its decision.

As for the merits of CVFC’s challenge to the regulation on its face, 

CVFC refers the Court to its opening brief where it argued why the regulation is 

both under-inclusive and over-inclusive and produces irrational results, as in the 

case concluding that a female treasurer going into premature labor was foreseeable 

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and thus did not excuse the committee’s late filing. Kuhn for Congress v. FEC, 

C.A. No. 2:13-3337-PMD-WWD (S.D.S.C. Aug. 22, 2014) (FEC Add. at 71). As 

the lower court noted, Congress provided in 52 U.S.C. 30102(i) [former 2 U.S.C. 

432(i)] that “[w]hen the treasurer of a political committee shows that best efforts 

have been used to obtain, maintain, and submit the information required by this 

Act for the political committee, any report or any records of such committee shall 

be considered in compliance with this Act.” Yet the FEC’s “best efforts” 

regulation unreasonably restricts this safety valve that provides for a showing of 

“good faith” efforts to comply in particular circumstances. Contrary to the FEC’s 

assertion, CVFC is not placing the burden on the FEC to show the committee was

entitled to the defense. Rather, CVFC made a compelling case demonstrating that 

it did use its “best efforts” to comply in light of the willful, reckless, and 

unforeseen conduct of its treasurer. Accordingly, CVFC submits that the FEC’s 

“best efforts” regulation was arbitrary and capricious on its face and as applied.

III. TREASURER’S PERSONAL LIABILITY

The essence of the FEC’s argument is that it has broad prosecutorial 

discretion in deciding to pursue civil enforcement under FECA and that it 

exercised it here by not pursuing Mr. Curry, the former treasurer. FEC Br. at 19. 

However, CVFC takes strong exception to the FEC’s position that the lower court 

“correctly found that ‘the Commission considered Mr. Curry’s personal liability, 

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

capacity.’” FEC Br. at 20; JA25. Nothing in the record shows that the 

Commissioners actually considered the issue of Mr. Curry’s personal liability or 

supplied “reasonable grounds” – or any grounds - for failing to prosecute him 

personally. As previously discussed, the agency must articulate the reasons for its 

actions at the time the decision took place and not “the post hoc rationalizations of 

the agency or the parties to [later] litigation.” Am. Textile Mfrs. Inst. v. Donovan,

452 U.S. 490, 539 (1981) (citing Citizens to Preserve Overton Park v. Volpe, 401 

U.S. 402, 419 (1971)).

Thus, with respect to CVFC’s argument that the FEC Office of General 

Counsel recommended that Commission consider the personal liability of the 

treasurer, the FEC asserts that “The Commissioners unanimously decided . . . not 

to pursue the former treasurer in these matters.” FEC Br. at 34, n.15. But we have 

no way of knowing if the Commissioners even considered this issue since there is 

no statement of reasons explaining this purported “decision” not to pursue the 

former treasurer.

Moreover, the FEC cherry picks statements from the General Counsel’s 

August 18, 2011 report to Dayna Brown of OAR, JA314, when it asserted that the 

General Counsel “concluded that the facts did not warrant pursuing Curry because 

his actions were consistent with someone resigning from office . . . .” FEC Br. at 

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20. However, a fair reading of that report shows that the facts were not so onesided and that even the General Counsel recognized that the “Commission could 

conclude that if Mr. Curry was still the Committee’s treasurer and neglected his 

duties while still treasurer to the extent alleged by the Committee, his actions 

constituted a reckless failure to fulfill his duties as treasurer.” JA317 (emphasis 

added). So here, it is plain without any equivocation that if the statements by the 

Chairman of CVFC to the FEC were true regarding the reckless conduct of the 

treasurer in failing to provide the password necessary for filing reports with the 

FEC and withholding records (and no reason has been proffered showing why the 

CVFC characterization of the treasurer’s reckless conduct is not accurate), then 

such conduct “constituted a reckless failure to fulfill his duties as treasurer.” 

JA317. In this regard, CVFC submits that in light of the facts in this case, it was 

the Commission itself that “recklessly failed to fulfill its duties” to enforce the law 

that clearly places personal liability on such a malfeasant treasurer or at least to 

investigate the matter further. The FEC had actual notice of Mr. Curry’s conduct 

as it was occurring from his own communications with FEC Reports Analysis 

Division, as well as those of CVFC’s chairman, as evidenced and repeatedly cited 

to by both parties.

CVFC’s brief provided a thick forest of statutory and regulatory provisions 

imposing personal liability on treasurers for such conduct. See CVFC Br. at 51-54 

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& n.7 (citing provisions). The FEC seems to cast this all aside and hide behind its 

so-called “Treasurer Policy” that is not grounded in the statute and regulations but 

conveniently allows it to arbitrarily absolve malfeasant treasurers and place the 

reputational and fiscal burden on the political committee.

Indeed, the FEC’s characterization of the administrative fine procedures as 

being akin to a “traffic ticket” system (FEC Br. at 46) demonstrates precisely why 

the FEC’s failure to impose personal liability on the treasurer is an abuse of 

discretion. CVFC wholeheartedly agrees with this analogy inasmuch as traffic 

tickets, for speeding or failure to yield, are issued to reckless drivers, not to the 

vehicles nor to their owners who may not be in the automobile, even when they 

employ the driver. Here, the PAC is merely the vehicle that has been operated in a

reckless manner outside the established rules or by failing to comply with some 

administrative requirement. And when the car is pulled over, it is the driver who 

receives the ticket, not the vehicle owner. Just as the car cannot (yet) drive itself, 

so too can a political committee only operate at the hands of its Treasurer, and in 

this case the Treasurer – as the FEC well knew – was the only one with the keys 

(password). The Commission would encourage reckless drivers to flee from the 

cars at the scene of the accident – or in this case, not deter treasurers from acting 

recklessly and then resigning, leaving the campaign holding the expensive “ticket.” 

Tickets are designed to punish and deter the transgressor for his transgression and 

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deter others similarly situated from such misconduct. Under the FEC’s laissez 

faire policy, the reckless treasurers experience no penalty and are free to continue 

on their malfeasant way.

It is worth noting that even minor traffic tickets are contestable in traffic 

court, where even a $25 parking ticket can be mitigated or abated if it is shown that 

there were valid reasons to explain the circumstances, such as one’s car being 

boxed in by two other cars, a flat tire, or a broken meter. Here, a small committee 

with limited funds was hit with an $8,690 ticket. This would require the 

committee to successfully solicit approximately 175 donors to contribute $50 each 

– a relatively large sum for a small committee – and thus sharply limit the amount 

it could otherwise spend on free speech in the political arena. Traffic tickets 

burden no fundamental right, whereas large fines that would force the closure of an 

organization would clearly interfere with free association and political speech. It is 

strange justice indeed that greater fairness and due process protection is afforded 

bad drivers than those who would participate in core First Amendment political 

activity.

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CONCLUSION

For all the foregoing reasons and those provided in CVFC's Opening Brief,

we urge the Court to reverse the judgment below.

Respectfully submitted,

 /s/Dan Backer

Dan Backer

DB Capital Strategies PLLC

203 South Union Street, Suite 300

Alexandria, VA 22314

(202) 210-5431

dbacker@dbcapitolstrategies.com

Paul D. Kamenar

Coolidge Reagan Foundation

1612 K Street, N.W., Suite 300

Washington, DC 20006

(202) 603-5397

Paul.kamenar@gmail.com

Counsel for Appellants 

Date: September 30, 2014

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CERTIFICATE OF COMPLIANCE

1. This brief complies with the type-volume limitation of Fed. R. App. P. 

28.1(e)(2) or 32(a)(7)(B) because: 

[ X ] this brief contains [5816] words, excluding the parts of the brief 

exempted by Fed. R. App. P. 32(a)(7)(B)(iii), or 

[ ] this brief uses a monospaced typeface and contains [state the number 

of] lines of text, excluding the parts of the brief exempted by Fed. R. App. P. 

32(a)(7)(B)(iii). 

2. This brief complies with the typeface requirements of Fed. R. App. P. 

32(a)(5) and the type style requirements of Fed. R. App. P. 32(a)(6) because: 

[ X ] this brief has been prepared in a proportionally spaced typeface using 

[Microsoft Word 2013] in [14pt Times New Roman]; or 

[ ] this brief has been prepared in a monospaced typeface using [state 

name and version of word processing program] with [state number of 

characters per inch and name of type style]. 

Dated: September 30, 2014 /s/ Dan Backer

Counsel for Appellants

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