UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF COLUMBIA 

CHRIS VAN HOLLEN, 

 Plaintiff, 

 v. 

FEDERAL ELECTION COMMISSION, 

 Defendant, 

 v. 

HISPANIC LEADERSHIP FUND, 

 Intervenor Defendant, 

 and 

CENTER FOR INDIVIDUAL FREEDOM, 

 Intervenor Defendant. 

Civil Action No. 1:11-cv-00766 (ABJ) 

PLAINTIFF’S SUPPLEMENTAL BRIEFING ON REMANDED ISSUES

For the reasons previously given and those set forth below, the challenged regulation, 11 

C.F.R. § 104.20(c)(9), should be invalidated as unreasonable under Chevron Step Two, see 

Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 843-44 (1984), 

and under the arbitrary and capricious standard, see Motor Vehicle Manufacturers Ass’n of U.S., 

Inc. v. State Farm Mutual Automobile Insurance Co., 463 U.S. 29, 42-43 (1983). 

Notwithstanding the deference the Court owes to the FEC’s determination at this stage, see 

Chevron, 467 U.S. at 844, the Court is not required to “rubber stamp” the FEC. Rather, as 

exemplified in Shays v. F.E.C., 414 F.3d 76 (D.C. Cir. 2005), the Court’s role is to examine the 

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agency’s action and rationale closely and to overturn agency action that is unreasonable. At 

Chevron Step Two, the Court asks “whether the Commission’s interpretation of [the statutory 

language] is reasonable ‘in light of the language, legislative history, and policies of the statute.’” 

Shays v. F.E.C., 337 F. Supp. 2d 28, 78 (D.D.C. 2004), aff'd sub nom. Shays v. F.E.C., 414 F.3d 

76 (D.C. Cir. 2005) (“Shays I”); see also Berge v. United States, 879 F. Supp. 2d 98, 119 

(D.D.C. 2012) (“[T]he Court should not stand aside and rubber-stamp . . . the decision if it deems 

the decision inconsistent with a statutory mandate or it frustrates the congressional policy 

underlying a statute.”) (internal quotation marks, brackets, and citation omitted). Not only does 

the agency’s interpretation need to be reasonable; but also, under the APA’s arbitrary and 

capricious standard, the agency must articulate a satisfactory explanation for its action including 

a rational connection between the facts found and the choice made. See State Farm, 463 U.S. at 

43; see also Shays I, 414 F.3d at 97 (holding that the FEC had given no rational justification for 

certain rules). In applying Chevron Step Two and the APA, the Court “must reject 

administrative constructions of a statute that frustrate the policy that Congress sought to 

implement,” Shays v. F.E.C., 528 F.3d 914, 919 (D.C. Cir. 2008) (“Shays III”) (internal 

quotation marks, brackets, and citations omitted), as is the case here. 

There are ample grounds to invalidate the challenged regulation under Chevron Step Two 

and the APA, including the ten points below, which were advanced in Plaintiff’s Motion for 

Summary Judgment (“Pl.’s MSJ”) [Dkt. #20] and Plaintiff’s Reply & Opposition to Defendant 

FEC’s Cross-Motion for Summary Judgment (“Pl.’s Reply”) [Dkt. #34]: 

• The FEC’s conclusion that a purpose test was necessary to avoid imposing 

unacceptable burdens on corporations and labor organizations was irrational and 

lacked cogent factual support. See Pl.’s MSJ 29. 

• A corporation’s customers and investors are plainly not “contributors” within the 

meaning of the Act or common parlance. See id. 30. 

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• Corporations and labor organizations could avoid the entire supposed burden the 

FEC cited through the simple expedient of establishing a segregated account 

pursuant to 2 U.S.C. § 434(f)(2)(E). See id. 

• Full disclosure of donors had been required without a “purpose” exception for 

four years under the FEC’s original rule. See id. 

• The challenged regulation frustrates the intent of Congress by inviting 

corporations and labor organizations to evade BCRA’s reporting requirements for 

electioneering communications (“ECs”). See id. 33. 

• Requiring disclosure about those who spend money on ECs without requiring that 

those spenders disclose “all contributors” allows such spenders to run “electionrelated advertisements while hiding behind dubious and misleading names.” See 

Pl.’s Reply 10-11 (quoting Citizens United v. F.E.C., 558 U.S. 310 (2010)). 

• The FEC’s statement that corporations and labor organizations cannot identify 

those persons who provided funds totaling $1,000 or more without an inordinate 

amount of effort is irrational and unsupported by the administrative record. See 

id. 12. 

• The self-serving, factually unsupported, and conclusory testimony of witnesses 

who do not wish to disclose who is funding an organization’s ECs provides an 

insufficient factual basis for the FEC’s regulation. See Pl.’s MSJ 29. 

• The FEC has never explained the inconsistency between the challenged regulation 

and 11 C.F.R. 104.20(c)(8) which imposes an “all contributors” requirement 

without any purpose test on individuals, partnerships, and unincorporated 

organizations that make ECs. See Pl.’s Reply 13. 

• The FEC also has not explained why, in promulgating § 104.20(c)(9), it 

incorporated “for the purpose of furthering” language from 2 U.S.C. § 434(c)(2), 

which addresses disclosure requirements related to “independent expenditures,” 

when Congress did not use that language in 2 U.S.C. § 434(f)(2) regarding EC 

disclosure requirements. See Pl.’s MSJ 12. 

In addition, the regulation should be invalidated because: (1) the FEC failed to show in 

its Explanation and Justification (“E & J”) that limiting disclosure to those contributors who give 

“for the purpose of furthering” ECs would, in fact, reveal the sources of funding for such 

disbursements as required by BCRA; and (2) the E & J is devoid of any finding that the 

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challenged regulation would in fact lead to the disclosure of donors who sought to further ECs. 

Plaintiff will only address, here, these two additional arguments. 

I. The FEC’s Stated Objective—To Limit Disclosure to Contributors Who “Actually 

Support” Particular Electioneering Communications—Is Arbitrary and Capricious 

Because It Flouts BCRA’s Language and Purpose. 

The FEC’s E & J posited that § 104.20(c)(9) would “appropriately provide[] the public 

with information about those persons who actually support the message conveyed” by ECs. 

FEC, Final Rule and Explanation and Justification on Electioneering Communications (“E & J”), 

11 C.F.R. Part 104, 114, 72 Fed. Reg. 72899-01, 72911 (Dec. 26, 2007). But, whether or not the 

purpose test would actually achieve that narrow objective (see Point II below), that objective 

arbitrarily diverges from and dilutes BCRA’s broader objective. BCRA was not enacted merely 

to provide the public with information “about those persons who actually support the message 

conveyed by ECs.” Id. Rather, the point of BCRA’s EC disclosure requirements is to identify 

more broadly whose money the EC spender was using. See Pl.’s MSJ 4 n.2 (quoting floor 

statements of Senators Jeffords, Snowe, and Feinstein). 

Congress took this approach in BCRA for two principal reasons: First, Congress 

concluded that it was relevant for citizens to know the objective facts of whose money EC 

spenders were using, regardless of those contributors’ subjective intent. See id. And, second, it 

is inferable that Congress concluded that a disclosure requirement triggered by an inquiry into 

subjective intent would be prone to evasion. See Shays III, 528 F.3d at 927 (“BCRA reflects the 

hard lesson of circumvention Congress has learned from the entire history of campaign finance 

regulation.”) (internal quotation marks and citation omitted). Thus, the regulation is an 

unreasonable constriction of BCRA. 

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BCRA’s language supports this conclusion. It requires “[e]very person who makes a 

disbursement for the direct costs” of producing and airing ECs in an aggregate amount in excess 

of $10,000 in a calendar year to disclose the “names and addresses of all contributors who 

contributed . . . $1,000 or more . . . .” 2 U.S.C. § 434(f) (emphasis added). BCRA used the word 

“for” solely in relation to identifying the person making the EC, not to the contributors to that 

person. If Congress had meant to mandate disclosure of only those contributors who contributed 

for the direct costs of producing and airing ECs, it certainly knew how to do this, and it could 

have done so by saying “all contributors who contributed” $1,000 or more “for such ECs.” 

Congress did not do so. Cf. Shays I, 414 F.3d at 108 (“[W]hen BCRA says ‘made,’ we presume, 

absent compelling indication otherwise, that it means ‘made’ and not ‘made for a fee.’”); 

T.I.M.E., Inc. v. United States, 359 U.S. 464, 470-71 (1959) (court would not impute 

Congressional intention to create a right of reparation in statutory provision from which it was 

omitted, where Congress specifically provided for right in another provision of the same statute); 

Touche Ross & Co. v. Redington, 442 U.S. 560, 573 (1979) (refusing to imply private remedy in 

statute because when Congress wished to provide a private damage remedy, it did so expressly). 

II. The Challenged Regulation Is Arbitrary and Capricious Because the FEC Adduced 

No Evidence To Support Its Assumption That the Purpose Test Will Lead to 

Disclosure of Donors Who Harbor a Purpose of Furthering Electioneering 

Communications. 

Not only did the FEC arbitrarily constrict BCRA’s disclosure objectives, the FEC’s E & J 

fails to adduce evidence that the challenged regulation would even achieve the narrower 

objective the FEC, mistakenly, articulated. The FEC, it is now said, meant the challenged 

regulation to exclude only donors who give “for purposes entirely unrelated to the making of 

ECs.” E & J at 72911; see also Statement of Comm’r Steven T. Walther Regarding the Petition 

for Rulemaking to Update 11 C.F.R. § 104.20(c)(8) and (c)(9) Filed by the Center for Individual 

Case 1:11-cv-00766-ABJ Document 87 Filed 04/08/13 Page 5 of 8
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Freedom (“Walther Statement”), Mar. 7, 2013, 3-4. The FEC Commissioners now say that the 

stated objective of the FEC was not to shield donors whose actual purpose (in whole or in part) 

was to support ECs. See Statement of Comm’r Ellen L. Weintraub on the Petition for 

Rulemaking filed by the Center for Individual Freedom (“Weintraub Statement”), Mar. 7, 2013, 

1 (“The regulation has been erroneously interpreted to obviate any disclosure obligations except 

when the donor earmarks a contribution for a specific electioneering communication – which, 

naturally, donors rarely do.”) The FEC, however, cited no evidence or data, as required by the 

APA, see, e.g., Shays III, 528 F.3d at 928-29, to support any conclusion that adding the “for the 

purpose of furthering” language would, in fact, lead to full disclosure of donors who give for 

reasons related to the making of ECs. 

In fact, the challenged regulation has led to little to no disclosure. See Pl.’s MSJ 14-15; 

Pl.’s Reply 11; FEC Answer [Dkt. #16] at ¶¶ 30-31. In the 2012 elections, non-profit 

corporations and labor unions reported spending approximately $14 million on ECs. These EC 

spenders reported only about $1.5 million from contributors—about 10% of what they spent.1

 

See Nonprofit Electioneering Communications and Disclosure in 2012 cycle, available at 

http://www.opensecrets.org/outsidespending/electioneering_2012.php (last visited April 8, 

2013). Commissioner Weintraub, one of two remaining commissioners who participated in the 

rulemaking, has stated that “this result is not what the Commission intended when it promulgated 

the rule. It is also plainly not what Congress had in mind when it passed the relevant provisions 

of [BCRA], which were designed to significantly expand disclosure requirements with respect to 

 

1

 One corporation, Mayors Against Illegal Guns reported spending roughly $175,000 in ECs, but reported

contributions of almost $3.4 million. The $1.5 million figure includes only this $175,000 as it is irrelevant to the 

question at hand that MAIG collected far more than it spent on ECs. 

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electioneering communications. The rule has been widely misconstrued to undermine that goal.” 

See Weintraub Statement 2 (emphasis in original). 

Promulgating a rule that can be “widely misconstrued” so as to effectively exempt 

corporations and labor organizations from BCRA’s EC donor disclosure provisions “runs 

completely afoul” of the BCRA sponsors’ goal to ensure that the public is informed of the 

identity of persons whose money EC spenders use. Shays, 337 F. Supp. 2d at 63. “[T]herefore 

the regulation is entitled to no deference” at Chevron Step Two. Id.; see also National Gypsum 

Co. v. U.S. E.P.A., 968 F.2d 40, 44, 47 (D.C. Cir. 1992) (agency “must at least give a reasoned 

explanation for its assumption”); Missouri Pub. Serv. Comm’n v. F.E.R.C., 337 F.3d 1066, 1070 

(D.C. Cir. 2003). 

CONCLUSION 

 For these reasons, and those set forth in earlier briefs, Plaintiff respectfully urges the 

Court to declare that the challenged regulation, 11 C.F.R. § 104.20(c)(9), is unreasonable, 

arbitrary and capricious, and contrary to law. In light of the FEC’s total inability to act—

showcased by its failure to appear in the Court of Appeals in this litigation and the still pending 

post-Citizens United rulemaking—Plaintiff respectfully requests that the regulation be vacated, 

otherwise the invalidated regulation could remain in force indefinitely. In applying APA 

arbitrary and capricious review, the D.C. Circuit does “not hesitate[] to vacate a rule when the 

agency has not responded to empirical data or to an argument inconsistent with its conclusion.” 

Comcast Corp. v. F.C.C., 579 F.3d 1, 8 (D.C. Cir. 2009). Vacating § 104.20(c)(9) would not be 

“disruptive,” see Allied-Signal, Inc. v. U.S. Nuclear Regulatory Comm’n, 988 F.2d 146, 151 

(D.C. Cir. 1993); as this Court has recognized, “[p]rior to the promulgation of the regulation that 

was struck down, there was a valid regulation in effect implementing the BCRA’s disclosure 

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requirement.” Mem. Op. and Order denying stay [Dkt. #61] at 3 (citing 11 C.F.R. § 104.20(c) 

(effective Feb. 3, 2003 to Dec. 25, 2007); 68 Fed. Reg. 404, 419 (Jan. 3, 2003)). 

Dated this 8th day of April, 2013. 

Respectfully submitted, 

Fred Wertheimer (Bar No. 154211) 

DEMOCRACY 21 

2000 Massachusetts Ave, N.W. 

Washington, D.C. 20036 

(202) 355-9610 

/s/ Roger M. Witten 

Roger M. Witten (Bar No. 163261) 

Fiona J. Kaye 

WILMER CUTLER PICKERING

 HALE AND DORR LLP

7 World Trade Center 

New York, NY 10007 

(212) 230-8800 

Donald J. Simon (Bar No. 256388) 

SONOSKY CHAMBERS SACHSE

 ENDRESON & PERRY, LLP

1425 K Street, N.W., Suite 600 

Washington, D.C. 20005 

(202) 682-0240 

Trevor Potter (Bar No. 413778) 

J. Gerald Hebert (Bar No. 447676) 

Paul S. Ryan (Bar No. 502514) 

Tara Malloy (Bar No. 988280) 

CAMPAIGN LEGAL CENTER

215 E Street N.E. 

Washington, D.C. 20002 

(202) 736-2200 

Scott L. Nelson (Bar No. 413548) 

PUBLIC CITIZEN

 LITIGATION GROUP

1600 20th Street, N.W. 

Washington, D.C. 20009 

(202) 588-1000 

Attorneys for Plaintiff Chris Van Hollen 

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