UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF COLUMBIA 

_________________________________________ 

 ) 

WENDY E. WAGNER, et al., ) 

 ) 

Plaintiffs, ) 

) Civil Action No. 11-cv-1841-JEB 

 v. ) 

 ) MEMORANDUM 

FEDERAL ELECTION COMMISSION, ) 

 ) 

Defendant. ) 

_________________________________________ ) 

DEFENDANT FEDERAL ELECTION COMMISSION’S 

MEMORANDUM IN SUPPORT OF ITS MOTION FOR SUMMARY JUDGMENT 

AND IN OPPOSITION TO PLAINTIFFS’ MOTION FOR SUMMARY JUDGMENT 

Anthony Herman (D.C. Bar No. 424643) 

General Counsel 

David Kolker (D.C. Bar No. 394558) 

Associate General Counsel 

Lisa J. Stevenson (D.C. Bar No. 457628) 

Special Counsel to the General Counsel 

Harry J. Summers 

Assistant General Counsel 

Holly J. Baker 

Attorney 

Seth Nesin 

Attorney 

COUNSEL FOR DEFENDANT 

FEDERAL ELECTION COMMISSION 

999 E Street, NW 

Washington, DC 20463 

Telephone: (202) 694-1650 

August 15, 2012 Fax: (202) 219-0260

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TABLE OF CONTENTS 

 Page 

BACKGROUND ............................................................................................................ 1 

ARGUMENT .................................................................................................................. 3 

I. SECTION 441c IS CONSTITUTIONAL UNDER THE FIRST 

AMENDMENT................................................................................................... 3 

A. The Federal Contractor Ban Is Closely Drawn to Match 

the Government’s Important Interests in Preventing 

Corruption, the Appearance of Corruption, and Political 

Coercion of Federal Contractors ............................................................. 3 

B. Section 441c Serves an Important Purpose in Combating 

Corruption ............................................................................................... 7 

C. Section 441c Is Closely Drawn Because It Creates Only 

a Modest Burden on Expression .......................................................... 10 

D. Section 441c’s Constitutionality Is Not Called into Question 

by Either Its Legislative History or Congress’s Decision Not 

to Amend the Provision ........................................................................ 12 

 

II. SECTION 441c SATISFIES THE EQUAL PROTECTION 

GUARANTEE OF THE FIFTH AMENDMENT ............................................ 13 

A. Because the Contribution Ban Does Not Infringe a 

Fundamental Right, It Receives a More Lenient Standard 

of Review .............................................................................................. 13 

B. Equal Protection Analysis Must Consider the Statute as 

a Whole to Determine Whether Differential Treatment Is 

Constitutional ........................................................................................ 15 

C. The Differential Treatment Between Federal Contractors 

and Federal Employees Is Constitutional ............................................. 17 

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D. The Differential Treatment Between Individual Contractors 

and Corporate Contractors Is Constitutional ......................................... 19 

III. CONCLUSION ................................................................................................. 21 

 

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TABLE OF AUTHORITIES 

 Page 

Cases 

Adarand Constructors, Inc. v. Slater, 528 U.S. 216 (2000) ......................................... 14 

Blount v. SEC, 61 F.3d 938 (D.C. Cir. 1995) ........................................................... 6, 11 

*Buckley v. Valeo, 424 U.S. 1 (1976) .................................................................... passim 

Burson v. Freeman, 504 U.S. 191 (1992) ....................................................................... 7 

*Cal. Med. Ass’n v. FEC, 453 U.S. 182 (1981) ...................................................... 15-16 

Citizens United v. FEC, 130 S. Ct. 876 (2010) ............................................................. 20 

*FEC v. Beaumont, 539 U.S. 146 (2003) ........................................................... 3, 14, 20 

Green Party of Conn. v. Garfield, 616 F.3d 189 (2d Cir. 2010), 

cert denied, 131 S. Ct. 3090 (2011) ................................................................... 7 

Lavin v. Husted, No. 11-3908, 2012 WL 3140909 (6th Cir. Aug. 3, 2012) ................... 7 

McConnell v. FEC, 540 U.S. 93 (2003) ...................................................................... 6, 8 

Mills v. Habluetzel, 456 U.S. 91 (1982) ....................................................................... 14 

Miss. Univ. for Women v. Hogan, 458 U.S. 718 (1982) ............................................... 14 

Nat’l Fed’n of Indep. Bus. v. Sebelius, 132 S. Ct. 2566 (2012) .................................... 12 

Nixon v. Shrink Missouri Gov’t PAC, 528 U.S. 377 (2000) ................................. 3, 6, 10 

Police Dept. of City of Chi. v. Mosley, 408 U.S. 92 (1972) .......................................... 15

Preston v. Leake, 660 F.3d 726 (4th Cir. 2011) ........................................................... 11 

Randall v. Sorrell, 548 U.S. 230 (2006) ................................................................... 5, 18 

*U.S. Civil Service Comm’n v. Nat’l Ass’n of Letter Carriers, AFL-CIO

413 U.S. 548 (1973) ................................................................................. 3, 4, 11 

United States v. Fausto, 484 U.S. 439 (1988) .............................................................. 13 

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Williams v. Rhodes, 393 U.S. 23 (1968) ....................................................................... 15 

Woods v. Cloyd W. Miller Co., 333 U.S. 138 (1948).................................................... 12 

Yamada v. Weaver, No. 10-cv-00497, 2012 WL 983559 

(D. Hawaii March 21, 2012) ............................................................................... 7 

Statutes and Regulations 

Amendments to Hatch Act of 1939, 1940 Ed., § 61m-1 (July 19, 1940, c. 640, 

§ 5, 54 Stat. 772), codified at 18 U.S.C. § 611 ................................................... 2 

Federal Election Campaign Act of 1971, as amended, 2 U.S.C. §§ 431-57 ................... 1 

2 U.S.C. § 431(8)(B) ..................................................................................................... 11 

2 U.S.C. § 441b(a) ........................................................................................................ 19 

2 U.S.C. § 441b(b) ........................................................................................................ 15 

2 U.S.C. § 441b(b)(4)(A)(i) .......................................................................................... 19 

*2 U.S.C. § 441c .................................................................................................... passim 

2 U.S.C. § 441c(a)........................................................................................................... 1

2 U.S.C. § 441c(a)(1) ...................................................................................................... 1 

2 U.S.C. § 441c(b) ........................................................................................................ 19 

5 U.S.C. §§ 1201-1209 ................................................................................................. 18 

5 U.S.C. §§ 1214-15 ..................................................................................................... 18 

5 U.S.C. §§ 2301(b)(1) ................................................................................................. 18 

5 U.S.C. §§ 2301(b)(2) ................................................................................................. 18 

5 U.S.C. §§ 2301(b)(8)(A) ............................................................................................ 18 

5 C.F.R. § 734.413 ........................................................................................................ 17 

11 C.F.R. §§ 100.74-100.77 .......................................................................................... 11 

11 C.F.R. § 100.94 ........................................................................................................ 11 

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Miscellaneous 

86 Cong. Rec. 2563 (March 8, 1940)............................................................................ 12 

Md. State Dep’t of Assessments and Taxation, Articles of Organization for LLC 

form and instructions, http://www.dat.state.md.us/sdatweb/artorgan.pdf ........ 21 

U.S. Senate, Committee on Homeland Security and Government Affairs, 

S. Prt. 110-36, Policy and Supporting Positions (2008) ..................................... 8 

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In denying plaintiffs’ request for a preliminary injunction, this Court previously held that 

it is unlikely that 2 U.S.C. § 441c violates either the First Amendment or the equal protection 

guarantee of the Fifth Amendment as applied to individuals with federal contracts. Wagner v. 

FEC, __F. Supp.2d __, 2012 WL 1255145 (D.D.C. Apr. 16, 2012) (“Mem. Op.”) (Doc. No. 28). 

As the Court recognized, the prohibition on federal contractors making campaign contributions is 

a longstanding and important measure in combating corruption and the appearance of corruption, 

and ensuring an effective and unbiased federal workforce free from political coercion. Neither 

plaintiffs’ memorandum in support of their motion for summary judgment (Plaintiffs’ Statement 

of Points and Authorities in Support of Their Motion for Summary Judgment (“Pls.’ Mem.”) 

(July 12, 2012) (Doc. No. 30-1)) nor their statement of undisputed facts offers anything new that 

could support a different conclusion on the merits. The Court should therefore uphold the statute 

and grant summary judgment for the Federal Election Commission (“FEC” or “Commission”).1

 

BACKGROUND 

 The Federal Election Campaign Act of 1971, as amended (“FECA” or “Act”), 2 U.S.C. 

§§ 431-57, prohibits any person who is negotiating or performing a contract with the United 

States government or any of its agencies or departments from making a contribution to any 

political party, political committee, or federal candidate. See 2 U.S.C. § 441c(a).2

 Congress 

 

1

 To diminish duplication of earlier briefs, the parties agreed that they would each file only 

a single brief on their cross motions for summary judgment and that arguments made in the 

earlier briefs would not be waived by failure to raise them here. A more complete recitation of 

the background is set forth in the FEC’s prior brief filed in opposition to plaintiffs’ motion for a 

preliminary injunction. (Defendant FEC’s Opposition To Plaintiffs’ Motion for a Preliminary 

Injunction (Mar. 1, 2012) (Doc. No. 25).) 

2

 2 U.S.C. § 441c(a)(1) provides: 

“(a) Prohibition. It shall be unlawful for any person — 

(1) Who enters into any contract with the United States or any department or agency thereof 

either for the rendition of personal services or furnishing any material, supplies, or 

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originally enacted this prohibition on contributions by federal contractors as part of the 1940 

amendments to the Hatch Act of 1939.3

 The law was intended, inter alia, to ensure a meritbased federal workforce free of coercion or other improper political influence, following many 

decades of inadequate reform efforts to deal with the problems of political influence. (FEC’s 

Statement of Material Facts ¶¶ 15-31 (“FEC Facts”).) 

Plaintiffs are three individuals who chose to enter into contracts with the federal 

government and are thereby currently prohibited from making contributions. (FEC Facts ¶¶ 2-5.) 

They have brought this action to strike down the contribution prohibition in section 441c, 

claiming that it violates both the First Amendment and the equal protection guarantee of the Fifth 

Amendment. The action was brought against the FEC, the independent agency of the United 

States government with exclusive jurisdiction to administer, interpret, and civilly enforce FECA. 

(Id. ¶ 1) 

 Plaintiffs sought a preliminary injunction barring the FEC from enforcing section 441c 

while the case was pending, allegedly so that they could make contributions during the 2012 

election cycle. (Plaintiffs’ Motion for a Preliminary Injunction) (Jan. 31, 2012) (Doc. No. 18).) 

After full briefing and argument, the Court denied the motion for a preliminary injunction, 

finding that plaintiffs were unlikely to succeed on the merits of their claims. (Mem. Op. at 26.) 

 

equipment to the United States or any department or agency thereof . . . , if payment for 

the performance of such contract or payment for such material, supplies, equipment . . . 

to be made in whole or in part from funds appropriated by the Congress, at any time 

between the commencement of negotiations for the later of (A) the completion of 

performance under; or (B) the termination of negotiations for, such contract or 

furnishing of material, supplies, equipment . . . , directly or indirectly to make any 

contribution of money or other things of value, or to promise expressly or impliedly to 

make any such contribution to any political party, committee, or candidate for public 

office or to any person for any political purpose or use[.]” 

3

 Amendments to Hatch Act of 1939, 1940 Ed., § 61m-1 (July 19, 1940, c. 640, § 5, 54 

Stat. 772), codified at 18 U.S.C. § 611 (originally 18 U.S.C. § 61m-1).

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ARGUMENT 

I. SECTION 441c IS CONSTITUTIONAL UNDER THE FIRST AMENDMENT 

A. The Federal Contractor Ban Is Closely Drawn to Match the Government’s 

Important Interests in Preventing Corruption, the Appearance of 

Corruption, and Political Coercion of Federal Contractors 

A law limiting campaign contributions challenged under the First Amendment need not 

satisfy the “narrowly tailored” requirement of strict scrutiny. Rather — as this Court previously 

determined, and plaintiffs acknowledged — such a law “passes muster if it satisfies the lesser 

demand of being closely drawn to match a sufficiently important interest.” FEC v. Beaumont, 

539 U.S. 146, 162 (2003) (quoting Nixon v. Shrink Missouri Gov’t PAC, 528 U.S. 377, 387-88 

(2000)) (internal quotation marks omitted); Mem. Op. 5-7; Plaintiffs’ Reply Statement of Points 

and Authorities in Support of Plaintiffs’ Motion for Preliminary Injunction at 12-13 (Mar. 12, 

2012) (Doc. No. 26). 

The Supreme Court has described the “closely drawn” standard as a “relatively 

complaisant review,” Beaumont, 539 U.S. 161-62, and section 441c easily meets it. The ban on 

contractor contributions closely matches the important government interests of preventing 

corruption and the “appearance of corruption spawned by the real or imagined coercive influence 

of large financial contributions on candidates’ positions and on their actions if elected to office. ” 

Buckley v. Valeo, 424 U.S. 1, 25 (1976). It also matches the interests of ensuring that federal 

contracts are awarded on merit, that federal contractors carry out their duties in a nonpartisan 

manner, and that contractors not be coerced into political participation. The Supreme Court has 

identified these interests as sufficiently important to support some infringement on political 

expression. See U.S. Civil Service Comm’n v. Nat’l Ass’n of Letter Carriers, AFL-CIO, 413 

U.S. 548, 557, 565-66 (1973) (identifying the same substantial government interests supporting 

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the Hatch Act, which restricts political activity by federal employees). Both this Court and 

plaintiffs have also noted that these interests are substantial. (Mem. Op. at 8-9 (“It is well 

established that preventing corruption or its appearance is a sufficiently important government 

interest to justify certain restrictions on political giving.”); Pls.’ Mem. at 7 (avoiding the 

appearance of pay-to-play is “an important government interest.”).) 

Plaintiffs rely on three general arguments in their failed attempt to show that section 441c 

is not “closely drawn.” First, plaintiffs argue that the problems of corruption and coercion could 

be managed effectively through less-restrictive criminal statutes, such as the existing provisions 

that criminalize the coercion of federal employees (see Pls.’ Mem. at 6). But plaintiffs fail to 

acknowledge that the Hatch Act protects federal employees above and beyond the criminal 

provisions they cite, and Letter Carriers clearly upheld Congress’s decision to enact these 

additional protections. And regarding FECA, the Supreme Court in Buckley dismissed virtually 

the same argument that plaintiffs make here. 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. Buckley, 424 U.S. at 27. 

The Court recognized that “laws making criminal the giving and taking of bribes deal with only 

the most blatant and specific attempts of those with money to influence governmental action.” 

Id. at 27-28. The Court thus held that it was well within Congress’s power to determine that the 

federal contractor contribution ban is necessary to prevent less blatant forms of corruption and 

coercion.4

 

4

 Plaintiffs note (Pls.’ Mem. at 2) that the Court “may not be fully aware of the breadth of 

application of section 441c, beyond plaintiffs themselves.” Neither plaintiffs nor the 

Commission has been able to ascertain the precise number of individuals with federal 

government contracts. But the fact that this case has far-reaching implications is a reason for the 

Court to proceed with extreme caution, not to overturn the law. And the fact that some 

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Second, plaintiffs invent a series of other statutory provisions that they believe would be 

less restrictive but in their view would “still provide meaningful protection against the 

appearance of improper ‘pay-to-play.’” (Pls.’ Mem. at 9-11.) As this Court has already noted, 

however, this sort of Congressional determination is entitled to deference, in part because 

Congress “is better equipped to make . . . empirical judgments” than the Court. (Mem. Op. at 14 

(quoting Randall v. Sorrell, 548 U.S. 230, 248 (2006).) Plaintiffs’ belief that a different 

provision might still “provide meaningful protection” cannot be substituted for Congress’s 

judgment, and their wish that the law be perfectly tailored in every respect is directly at odds 

with the applicable “closely drawn” standard. In any event, plaintiffs’ suggested statutory 

amendments would likely eviscerate section 441c, given that their proposed exclusions would 

include virtually the entire universe of federal contracts. (Pls.’ Mem. at 10-11 (suggesting law 

might be amended to “[e]xclude individuals . . . who are the functional equivalent of federal 

employees” or “[e]xclude smaller contracts” or “[e]xclude contracts that are entered into by a 

process of open competitive bids” or “[e]xclude sole source contracts.”)5

 Moreover, some of 

plaintiffs’ other proposed amendments would do little or nothing to serve the important interests 

 

“individuals like plaintiffs” may not “need or want any such ‘protection’ from coercion” (Pls.’ 

Mem. at 6) is beside the point. While some contractors and potential contractors may be 

unconcerned about political influence — or may even welcome the opportunity to exert such 

influence — section 441c is designed to protect the greater interests of the public in a 

depoliticized contracting process and a federal election system without corruption. Just as 

Buckley upheld FECA’s contribution limits across the board even though the Court assumed that 

“most large contributors do not seek improper influence,” 424 U.S. at 29, so too is section 441c 

valid as applied to plaintiffs, even if they personally would prefer not to be protected from 

coercion. 

5

 Several of the contracts plaintiffs identify as possible exclusions from the prohibition, 

such as small contracts and sole source contracts, have a streamlined process and therefore could 

potentially present a greater likelihood of politicization, rather than a diminished one. (FEC 

Facts ¶ 50.) Even relatively small contributions or contracts can result in corruption or the 

appearance of corruption. (FEC Facts ¶¶ 53, 93, 107, 111, 112.) 

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at stake. For example, the suggestion that contractors be permitted to make contributions, but 

only after the contract has been entered into (Pls.’ Mem. at 11), would do little to prevent 

corruption or the appearance of corruption — a contractor could simply indicate an intention to 

give a contribution later on — and would do nothing to protect a contractor from being coerced 

to make a contribution once the work on the contract had begun.6

Third, plaintiffs’ renew their underinclusive argument (Pls.’ Mem. at 12-15), relying 

again on their earlier suggestion that section 441c is unconstitutional because people who receive 

federal grants or loans, or admission to the service academies, are not barred from making 

contributions.7

 As this Court has explained, however, “[t]he D.C. Circuit has squarely rejected 

arguments of this kind, stating that ‘a regulation is not fatally underinclusive simply because an 

alternative regulation, which would restrict more speech or the speech of more people, could be 

more effective. The First Amendment does not require the government to curtail as much speech 

as may conceivably serve its goals.’” (Mem. Op. at 16 (quoting Blount v. SEC, 61 F.3d 938, 946 

(D.C. Cir. 1995).) Plaintiffs present no new facts or law that call into question the Court’s prior 

ruling on this point. 

 

6

 Plaintiffs suggest that their approach of identifying different ways in which the statute 

might be made more closely drawn is supported by the section of the McConnell decision that 

struck down a prohibition on contributions by minors. (Pls.’ Mem. at 8 n.2.) But that 

prohibition was an anti-circumvention measure — minors were prohibited from making 

contributions so that parents could not use their children as conduits to make contributions that 

the parents would not be able to make themselves. McConnell v. FEC, 540 U.S. 93, 232 (2003). 

In that particular situation, the Supreme Court was able to assess less restrictive anticircumvention measures that would be equally effective. Id.

7

 Plaintiffs also note that big contributors and fundraisers are sometimes rewarded with 

government positions. (Pls.’ Mem. at 14-15.) If individuals are able to obtain ambassadorships 

in part by contributing generously, it is “neither novel nor implausible” to assume that similar 

contributions could help lead to federal contracts, or at the very least, give that appearance. 

Nixon v. Shrink Mo. Gov’t PAC, 528 U.S. 377, 391 (2000); see also FEC Facts ¶¶ 104-14. 

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In sum, the bulk of plaintiffs’ recycled argument is that Congress could have drawn the 

lines it chose in regulating contributions by federal contractors and others differently. Those 

arguments, however, should be directed to Congress itself, not to this Court. 

B. Section 441c Serves an Important Purpose in Combating Corruption 

Corruption, the appearance of corruption, and the coercion of contractors have been 

genuine dangers, from the time the federal government first banned campaign contributions from 

federal contractors until today. The “pay-to-play” scandals in various states discussed in cases 

such as Green Party of Conn. v. Garfield, 616 F.3d 189 (2d Cir. 2010), cert denied, 131 S. Ct. 

3090 (2011) and Yamada v. Weaver, No. 10-cv-00497, 2012 WL 983559 (D. Hawaii March 21, 

2012) show that pay-to-play problems are not merely a relic from the past that has been 

eradicated, but a real threat that requires continuing government vigilance to combat.8

 If there is 

little recent evidence of federal contributions being used to influence contracting decisions, that 

is a credit to the efficacy of section 441c, not a reason to strike it down after 70 years on the 

books.9 (See Mem. Op. at 11-12 (citing Burson v. Freeman, 504 U.S. 191, 207 (1992).) 

 

8

 The Statement of Material Facts that accompanies this motion contains numerous 

additional examples of pay-to-play scandals in various jurisdictions that rely upon news accounts 

and other secondary sources. (See, e.g, FEC Facts ¶¶ 51-124.) Plaintiffs have expressed concern 

that these facts might “be used to establish material facts, or to oppose those facts that plaintiffs 

have designed [sic] as material facts not in dispute.” (Pls.’ Mem. at 2.) These facts, while 

material to the issues in this case, are legislative facts presented for the benefit of the Court and 

are not intended to contradict any of the adjudicative facts alleged by plaintiffs concerning their 

particular situations. (See Defendant FEC’s Opposition to Plaintiffs’ Motion to Certify Facts at 

6-7 (Dec. 5, 2011) (Doc. No. 11) (explaining the distinction between legislative and adjudicative 

facts).) 

9

 The long and widespread history of pay-to-play practices is what distinguishes this case 

and others like it from Lavin v. Husted, No. 11-3908, 2012 WL 3140909 (6th Cir. Aug. 3, 2012), 

which plaintiffs have cited to the Court as a supplemental authority. (Plaintiffs’ Notice of 

Additional Authority (Aug. 7, 2012) (Doc. No. 31).) The law challenged in Lavin was struck 

down because there was “no evidence that prosecutors in Ohio, or any other state for that matter” 

have made decisions to prosecute based on campaign contributions. Lavin, 2012 WL 3140909, 

at *3. In contrast, there is a wealth of evidence from numerous jurisdictions that contractors 

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 Even contributions made to candidates or political committees without a direct role in the 

contracting process can breed corruption and its appearance. As this Court found, the “wall 

between elected federal officials and agency heads is hardly as impassable as Plaintiffs make 

out.” (Mem. Op. at 16.) “Plaintiffs do not dispute . . . that elected officials can and sometimes 

do recommend contractors to agencies.” (Id.) And there are thousands of persons appointed by 

the President serving at various agencies, many of whom may play a role in the contracting 

process. (FEC Facts at ¶¶ 43-44 (quoting Deposition of Steven L. Schooner (“Schooner Dep.” ) 

at 27-28, 110-12, 114-15); U.S. Senate, Committee on Homeland Security and Government 

Affairs, S. Prt. 110-36, Policy and Supporting Positions (2008) (listing about 8,000 positions for 

political appointees in the executive and legislative branches).) These appointees can attempt to 

steer contracts to those who make contributions to a favored candidate or party. Cf., e.g., 

McConnell, 540 U.S. at 146-47 & n.46 (describing how indirect influence on a variety of 

government decision-makers was gained by making “soft money” donations to national political 

parties). In sum, as this Court correctly concluded, “there is a connection between federal 

elected officeholders and the awarding of contracts, albeit indirect, that supports a finding that 

the ban is closely drawn.” (Mem. Op. at 16.) 

 Even plaintiffs concede that “it is possible that a Member of Congress, the President, or a 

political appointee might attempt to influence the award of a federal contract,” although they 

regard the likelihood of that happening for an individual contract as “extremely small.” (Pls.’ 

Mem. at 7.) But plaintiffs’ subjective assessment of the likelihood of such undue influence does 

not matter; this quintessentially legislative judgment belongs to Congress. While plaintiffs may 

believe, for example, that the procurement process at USAID “generally” succeeds at precluding 

 

attempt and succeed in obtaining contracts by making campaign contributions. (FEC Facts ¶¶ 

51-90 (discussing pay-to-play scandals in various jurisdictions).) 

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outside influence (id. at 7), it is for Congress to decide how best to prevent potential corruption 

and the appearance of corruption, even when the risk is relatively small. See Buckley, 424 U.S. 

at 53 n.59 (upholding limit on contributions to candidates from family members because 

“[a]lthough the risk of improper influence is somewhat diminished in the case of large 

contributions from immediate family members, we cannot say that the danger is sufficiently 

reduced to bar Congress from subjecting family members to the same limitations as nonfamily 

contributors.”) 

Furthermore, many federal contracts, including those awarded to plaintiffs, are awarded 

through streamlined processes that dispense with the open formal bidding procedures. (See FEC 

Facts ¶¶ 3, 44-46, 49-50.) Plaintiffs assert that it is “not believable” and “beyond fanciful” to 

think that the award of such contracts might be influenced by making a campaign contribution. 

(Pls.’ Mem at 5, 12.) But plaintiffs’ own declarant testified as to the efficacy and usefulness of 

the competitive bidding process and the requirement for contracting officers who are “attuned to 

the need to be independent, above-board and [who are] able to explain their actions in an 

objective and impartial way” to help keep politics out of contracting. (FEC Facts ¶ 43 (quoting 

Schooner Dep. at 136).) It is neither unbelievable nor fanciful to believe that even small 

contributions might make a difference in a process “where the government can call two or three 

people on the phone” and make a determination on that basis. (See FEC Facts ¶ 50 (quoting 

Schooner Dep. at 107).) 

Lastly, even when actual corruption may be unlikely or difficult to prove, the 

government maintains an interest in fighting even the appearance of corruption. Plaintiffs argue 

that there would be no appearance of corruption to “a reasonable person, who understands how 

federal contracts are let.” (Pls.’ Mem. at 7.) But plaintiffs’ attempt to impose some sort of 

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10 

enhanced “reasonable person” standard — one that assumes knowledge of the federal contracting 

system — is way off the mark and without any basis in law. The Supreme Court has never 

hinted that only a specially educated subset of the public should be imagined as the focus group 

for determining whether certain campaign finance activity may create an appearance of 

corruption. To the contrary, the Court has spoken about the public at large, the voters who 

choose our elected officials. See, e.g., Shrink Missouri, 528 U.S. at 390 (“Leave the perception 

of impropriety unanswered, and the cynical assumption that large donors call the tune could 

jeopardize the willingness of voters to take part in democratic governance.”) Most Americans 

lack familiarity with the complexities of federal contracting, and they could easily view 

contributions by contractors with suspicion. Even plaintiffs’ own declarant, Professor Schooner, 

who teaches and studies federal contracting for a living, acknowledged that “I don’t know 

anything about how the retired annuitants [like plaintiffs Miller and Brown] and those types of 

contracts work” and “for all I know every agency that uses retired annuitants does it a different 

way.” (See FEC Facts ¶ 49 (quoting Schooner Dep. at 67, 81).) The government has an interest 

in preventing the appearance of corruption by prohibiting contractors’ campaign contributions, 

regardless of how they might be viewed by a small fraction of the public familiar with federal 

contracting law. 

C. Section 441c Is Closely Drawn Because It Creates Only a Modest Burden 

on Expression 

 Section 441c allows ample alternative forms of political expression, even though it 

temporarily prevents persons who choose to become federal contractors from making 

contributions. Federal contractors are not prohibited from speaking about candidates, 

volunteering for campaigns, raising funds for candidates or parties, blogging, or engaging in 

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11 

numerous other activities in which they can express their views of candidates or public issues. 

See 2 U.S.C. § 431(8)(B); 11 C.F.R. §§ 100.74-100.77, 100.94; FEC Facts ¶¶ 137-41. 

This Court has already noted that one reason the law is closely drawn is because “persons 

affected by the ban have other meaningful avenues for political association and expression.” 

(Mem. Op. at 15 (citing Blount, 61 F.3d at 948, and Preston v. Leake, 660 F.3d 726, 740 (4th 

Cir. 2011)).) Plaintiffs argue, however, that these alternative means of expression are of no 

consequence because “it is the right of the individual, not the government, to choose how she or 

he wishes to exercise his or her First Amendment rights . . . .” (Pls.’ Mem. at 15.) But plaintiffs’ 

argument is beside the point because the government is not choosing how plaintiffs express 

themselves. As this Court noted, this kind of restriction is a “mere ‘channeling device[]’” that 

“‘cut[s] off the avenue of association and expression that is most likely to lead to corruption but 

allow[s] numerous other avenues of association and expression.’” (Mem. Op. at 14 (quoting 

Preston, 660 F.3d at 734).) Plaintiffs cite no supporting authority for their argument, which is 

also directly contradicted by cases such as Letter Carriers and Buckley, each of which held that it 

was constitutional to limit certain types of expression while permitting other types. 

 Furthermore, section 441c’s prohibition is modest because it applies only while a contract 

is being negotiated or performed. If an individual wishes to make a contribution, that person can 

do so simply by completing the contract with the government, or by not entering into one in the 

first place. As this Court has noted, “Plaintiffs voluntarily chose to become federal contractors 

and are only subject to the ban for as long as they continue to make that choice.” (Mem. Op. 

at 15 (citing Preston, 660 F.3d at 740).) 

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12 

D. Section 441c’s Constitutionality Is Not Called into Question by Either Its 

Legislative History or Congress’s Decision Not to Amend the Provision 

 

 Plaintiffs also attack the constitutionality of section 441c by arguing that Senator Hatch, 

one of the bill’s original sponsors, may have used a flawed constitutional analysis when he 

expressed support for the law prior to its passage. (Pls.’ Mem. at 12-13 n.3 (quoting Remarks of 

Senator Hatch, 86 Cong. Rec. 2563 (March 8, 1940).) But legislative history is relevant in 

certain circumstances to help understand the purpose and meaning of a statute — it makes no 

difference whether Congress was wrong about why a particular law is constitutional. See Nat’l 

Fed’n of Indep. Bus. v. Sebelius, 132 S.Ct. 2566, 2598 (2012) (upholding the Affordable Care 

Act on a constitutional basis other than the one relied upon by Congress because “[t]he ‘question 

of the constitutionality of action taken by Congress does not depend on recitals of the power 

which it undertakes to exercise’” (quoting Woods v. Cloyd W. Miller Co., 333 U.S. 138, 144 

(1948))). 

 Plaintiffs also argue that Congress’s failure to amend the law during the past 72 years 

somehow suggests that it may not be closely drawn. (Pls.’ Mem. at 16.) Plaintiffs provide 

absolutely no authority for this novel approach to judging the constitutionality of a statute, and 

its flaws are readily apparent. Nothing in the Constitution remotely suggests that Congress is 

required to explicitly reaffirm every law on the books every few years, nor is it the courts’ role to 

examine whether Congress has done so. Such a means of constitutional review would be 

completely unworkable and raise serious separation of power concerns; plaintiffs can offer no 

explanation of how a court might judge whether Congress has sufficiently reconsidered 

previously enacted legislation and justified keeping it in the United States Code. 

 In any event, plaintiffs are wrong to assume that Congress has failed to consider the ban 

on contractor contributions since its passage. Both the Hatch Act and FECA have been amended 

Case 1:11-cv-01841-JEB Document 33 Filed 08/15/12 Page 18 of 36
13 

multiple times since 1940. (FEC Facts ¶¶ 32, 34-35.) Congress’s decision to amend other 

provisions — while leaving the contractor ban intact — strongly suggests that Congress believes 

that the provision continues to serve important interests. Cf. United States v. Fausto, 484 U.S. 

439, 453 (1988) (“[I]t can be strongly presumed that Congress will specifically address language 

on the statute books that it wishes to change.”) 

 Finally, to the extent that scandals involving federal contractors are relatively infrequent, 

that suggests that Congress’s efforts to depoliticize the government contracting process have 

been highly effective in changing both the practice and perception of political patronage in the 

federal system. This improvement in the realm of federal contracting presents a contrast to the 

attitude in certain states and municipalities that still regard pay-to-play as “how business is done” 

and where participants “don’t even know it’s wrong anymore.” (FEC Facts ¶¶ 55, 58 (quoting 

reports about scandals in New Mexico and Ohio).) Any time a statute modifies behavior and 

helps make compliance the norm — whether it is a reduction in race or gender discrimination, 

increase in seatbelt use, or decrease in corruption in federal contracting — a cultural shift in 

social expectations is likely to work in tandem with the law to create a virtuous cycle of 

increasing compliance. But that cycle could turn vicious if the law that started the improvements 

in the first place were suddenly overturned. Plaintiffs’ attempt to strike down a provision that 

has served the nation well for more than 70 years amounts to little more than a claim that it has 

worked so well it is no longer needed, but that argument has no colorable basis in fact or law. 

II. SECTION 441c SATISFIES THE EQUAL PROTECTION GUARANTEE OF 

THE FIFTH AMENDMENT

A. Because the Contribution Ban Does Not Infringe a Fundamental Right, 

It Receives a More Lenient Standard of Review 

This Court previously determined that plaintiffs’ equal protection claim should receive 

the same intermediate level of scrutiny as the First Amendment claim — “closely drawn to 

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14 

match a sufficiently important interest.” (Mem. Op. at 21 (quoting Beaumont, 539 U.S. at 161).) 

The FEC maintains that section 441c should not be subject to intermediate scrutiny — rather, the 

appropriate standard is rational basis review. This case involves neither a suspect class nor a 

fundamental right identified by the Supreme Court. (Mem. Op. at 17-19). Although the 

Supreme Court has sometimes applied intermediate scrutiny in equal protection cases, those 

cases all involve instances of “quasi-suspect” classes. (See id. at 20 (discussing the application 

of intermediate scrutiny in equal protection cases, citing Adarand Constructors, Inc. v. Slater, 

528 U.S. 216, 219 (2000) (noting the existence of intermediate scrutiny for “cases involving 

classifications on a basis other than race”); Miss. Univ. for Women v. Hogan, 458 U.S. 718, 724 

(1982) (gender); Mills v. Habluetzel, 456 U.S. 91, 98 (1982) (illegitimate children)).) We are 

aware of no Supreme Court case that has ever applied intermediate scrutiny to protect something 

akin to a quasi-fundamental right, and plaintiffs do not assert — and they cannot — that 

individual federal contractors are a “suspect” or “quasi-suspect” class. In the absence of such a 

right or class, the Supreme Court has applied rational basis review. 

 But even under the intermediate scrutiny that this Court previously applied, section 441c 

does not violate the equal protection guarantee of the Fifth Amendment.10 As the Court 

determined at the preliminary injunction stage, even under this higher standard of review, “the 

various comparison groups suggested by Plaintiffs are not similarly situated to individual 

contractors subject to § 441c .” (Mem. Op. at 26.) 

 

10 Contrary to plaintiffs’ baseless assertion (Pls.’ Mem. at 17), the Commission has not 

“conceded” that section 441c is unconstitutional under this higher standard of review. The FEC 

previously argued that the law withstood rational basis review because that was the standard it 

believed was applicable, not because it was the only standard the law could meet. By the same 

token, plaintiffs argued previously that strict scrutiny was the appropriate standard, but do not 

appear to have now conceded that the law is constitutional. 

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B. Equal Protection Analysis Must Consider the Statute as a Whole to 

Determine Whether Differential Treatment Is Constitutional 

As this Court has stated, under any standard of review, a court reviewing a law 

challenged for violating equal protection must determine “whether ‘an appropriate government 

interest [is] suitably furthered by the differential treatment.’” (Mem. Op. at 22 (quoting Police 

Dept. of City of Chi. v. Mosley, 408 U.S. 92, 95 (1972)).) The Court must “‘consider the facts 

and circumstances behind the law, the interests which the State claims to be protecting, and the 

interests of those who are disadvantaged by the classification.’” (Id. (quoting Williams v. 

Rhodes, 393 U.S. 23, 30 (1968)).) The statute and context must be considered in its entirety. 

In California Med. Ass’n v. FEC, 453 U.S. 182 (1981), the Supreme Court took this kind 

of holistic approach in reviewing an equal protection claim against a (different) provision of 

FECA. An unincorporated association challenged the limits on the contributions it could make 

to political committees. As in this case, the plaintiff association claimed both a violation of the 

First Amendment and the equal protection guarantee of the Fifth Amendment. The plaintiffs 

argued that corporations were treated more favorably due to the corporations’ ability to spend 

unlimited sums for the administrative and solicitation expenses of their separate segregated funds 

(“SSFs” — often referred to as “PACs”). Id. at 200; see also 2 U.S.C. § 441b(b). After 

concluding that there was no First Amendment violation, the Court also rejected the equal 

protection claim: “Appellants’ claim of unfair treatment ignores the plain fact that the statute as 

a whole imposes far fewer restrictions on individuals and unincorporated associations than it 

does on corporations and unions.” Cal Med. Ass’n, 453 U.S. at 200 (first emphasis added). The 

Court went on to describe other parts of the statute, which were not part of the constitutional 

challenge, and which favored the plaintiffs’ interests over corporations. It noted that “differing 

restrictions placed on individuals and unincorporated associations, on the one hand, and on 

Case 1:11-cv-01841-JEB Document 33 Filed 08/15/12 Page 21 of 36
16 

unions and corporations, on the other, reflect a judgment by Congress that these entities have 

differing structures and purposes, and that they therefore may require different forms of 

regulation in order to protect the integrity of the electoral process.” Id. at 201. 

The same equal protection analysis is properly invoked here. But instead, plaintiffs’ 

equal protection argument rests on a cramped and disaggregated analysis in which a single 

provision is viewed in isolation against a single governmental objective to determine whether the 

provision passes muster. Plaintiffs also limit their inquiry to only the government interest in 

thwarting pay-to-play and ignore the interest in preventing coercion of federal contractors.11 For 

example, plaintiffs state that the “only perspective that is relevant” is whether “plaintiffs [are] 

being treated equally as compared to corporate contractors and their officers, directors, 

shareholders, and employees in terms of avoiding the appearance of ‘pay-to-play” from the 

making of political contributions . . . .” (Pls.’ Mem. at 20.) Plaintiffs then repeatedly fail to 

consider other provisions that are part of the overall regulatory scheme: for example, the Hatch 

Act’s different restrictions on government employees and the ability of individuals to enter into 

contracts with the government through an LLC. Plaintiffs’ approach is out of step with the 

Court’s holistic approach adopted in California Medical Association.

 

11 Plaintiffs restrict their analysis to the government interest in preventing pay-to-play 

corruption because they mistakenly “do not understand the FEC to argue (or the Court to have 

found) that the avoidance of coercion rationale is different for plaintiffs than for the others.” 

(Pls.’ Mem. at 18.) To the contrary, both the Commission and the Court noted at the preliminary 

injunction stage that, for example, federal employees have greater civil service protection than 

do federal contractors and are thereby potentially less prone to being coerced and not similarly 

situated in that regard. (Defendant FEC’s Opposition To Plaintiffs’ Motion for a Preliminary 

Injunction at 33 & n.25 (Mar. 1, 2012) (Doc. No. 25); Mem. Op. at 23.) 

Case 1:11-cv-01841-JEB Document 33 Filed 08/15/12 Page 22 of 36
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C. The Differential Treatment Between Federal Contractors and Federal 

Employees Is Constitutional 

 As this Court previously found, the “restrictions on federal contractors’ freedoms of 

expression and association are different from those on federal employees, but not necessarily 

more severe.” (Mem. Op. at 24; see also FEC Facts ¶ 142.) Plaintiffs’ arguments in support of 

their motion for summary judgment add nothing new to those already rejected by the Court at the 

preliminary injunction stage. 

Federal employees and federal contractors are not the same and therefore are justifiably 

treated differently in numerous ways. (FEC Facts ¶¶ 147-51.) Even the plaintiffs “do not argue 

that the situations [of federal contractors and federal employees] are identical,” but merely that 

the two groups are “sufficiently close” that the law is unjustifiable for prohibiting contributions 

from only contractors. (Pls.’ Mem. at 24.) But this amounts, again, to plaintiffs asking the Court 

to substitute its judgment for that of the legislature. Especially in light of the many different 

occupations and functions of workers within the two categories (federal employees versus federal 

contractors), it is particularly difficult to assess whether these groups are “sufficiently close” to 

each other. Federal employees perform innumerable different duties for different agencies, as do 

federal contractors. The Hatch Act establishes different restrictions for employees of different 

agencies for this very reason. (FEC Facts ¶ 142.)12 It is Congress’s role to draw these fine and 

complex lines; the courts have “no scalpel to probe” with such specificity. Buckley, 424 U.S. at 

 

12 Plaintiffs make the novel argument that the regulation preventing FEC employees from 

making certain contributions is not actually a prohibition on contributions, but a restriction 

merely on the specific manner by which contributions can be delivered. (Pls.’ Mem. at 21 (citing 

5 C.F.R. § 734.413).) Plaintiffs cite no authority for this bizarre reading of the regulation in 

which FEC employees would be permitted to “financially support[ ] a Member of Congress so 

long as the contribution is made through a means such as the Internet or mail, so that the 

Member would never see or touch it.” (Id.) 

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30; see also Randall, 548 U.S. at 248 (“We cannot determine with any degree of exactitude the 

precise restriction necessary to carry out the statute’s legitimate objectives.”). 

As the Court noted (Mem. Op. at 23), one critical distinction between federal employees 

and contractors is that only the former are protected by the Merit Systems Protection Board 

(“MSPB”), which has the power to hear and decide complaints when an agency is alleged to 

have violated Merit System Principles governing federal employment. See 5 U.S.C. §§ 1201-

1209, 1214-15, 2301(b)(1)-(2). Two such Merit System Principles are that “[a]ll employees and 

applicants for employment should receive fair and equitable treatment in all aspects of personnel 

management without regard to political affiliation” and that “[e]mployees should be . . . 

protected against . . . coercion for partisan political purposes . . . .” 5 U.S.C. §§ 2301(b)(2), 

(b)(8)(A). Plaintiffs suggest that this difference is insubstantial because contractors still have 

“contractual and statutory rights that provide protections and guard against arbitrary agency 

action . . . as well as the Due Process Clause.” (Pls.’ Mem. at 23.) But plaintiffs make no effort 

to explain what sort of contractual and statutory rights they are describing, nor do they offer any 

legal support or even argue for the proposition that the Merit System’s protections are 

coextensive with the guarantees of the Due Process Clause. The MSPB exists for the purpose of 

ensuring that federal employment is based on merit. There is no comparable institution for 

federal contracting, and it therefore is sensible that Congress might take additional precautions to 

assure the meritorious awarding of contracts, such as by prohibiting contractors’ campaign 

contributions.13 

 

13 Contractors working for the federal government do not typically receive the same 

benefits as employees, can be required to have email addresses and badges that distinguish them 

from employees, and can even be required to answer the telephone in a different manner. (FEC 

Facts ¶¶ 148, 151 (citing Schooner Dep. at 73-75).) These seemingly minor details, in the 

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19 

D. The Differential Treatment Between Individual Contractors and Corporate 

Contractors Is Constitutional 

Both corporate contractors and individual contractors are prohibited from making 

campaign contributions — see 2 U.S.C. §§ 441b(a), 441c — so if those two groups are 

compared, there is no differential treatment. Employees and officers of corporate contractors 

can make contributions in their capacity as individuals because they do not personally have 

federal contracts. Plaintiffs will likewise be able to make contributions when they no longer 

have their own direct contracts with the federal government. 

Plaintiffs argue that they are unconstitutionally treated less favorably than corporate 

contractors because only a corporation may establish an SSF and solicit money from its 

“stockholders and their families and its executive or administrative personnel and their families”

for the purpose of making contributions. 2 U.S.C. §§ 441b(b)(4)(A)(i); 441c(b). In contrast to 

this “direct and easy path” by which corporations can make contributions, plaintiffs argue, 

“individuals have no means by which to accomplish their goal of making political contributions 

. . . .” (Pls.’ Mem. at 18.) This argument lacks merit for several reasons. 

First, the very existence of SSFs was intended by Congress to make evident that the 

corporation is not the entity making the contribution, and therefore plaintiffs’ notion that using 

an SSF is a “direct and easy path” for a corporation to make a contribution is wide of the mark. 

While plaintiffs believe that “no person with knowledge of the facts would perceive [a PAC 

contribution as different from a corporate contribution]” (Pls.’ Mem. at 19), that is not a view 

 

aggregate, also rebut the plaintiffs’ suggestion that federal employees and contractors are 

similarly situated overall. 

 Finally, plaintiffs devote a page of their brief rebutting the argument that “[b]ecause 

federal employees do not need new contracts or renewals, the FEC argues, they would have 

nothing to gain from making contributions or lose from not making them, which makes [federal 

employees and federal contractors] not comparable.” (Pls.’ Mem. at 23.) Plaintiffs have 

rebutted a straw man, however, because the FEC has never made this argument. 

Case 1:11-cv-01841-JEB Document 33 Filed 08/15/12 Page 25 of 36
20 

shared by Congress, which codified the regime of separate segregated funds in FECA. Nor is it 

the view of the Supreme Court, which has held that there exists a sufficient justification for 

FECA’s requirement that corporations establish an SSF for making contributions rather than 

making them directly from their corporate treasuries. See Beaumont, 539 U.S. at 147-48. 

Indeed, the holding in Citizens United rested in part on the Court’s determination that 

“[a] PAC is a separate association from the corporation.” Citizens United v. FEC, 130 S. Ct. 

876, 897 (2010). The Court held that a PAC’s ability to make independent expenditures was 

insufficient to alleviate the First Amendment burdens on corporations because the PAC option 

still “does not allow corporations to speak.” Id. Thus, plaintiffs’ argument that the treatment of 

PACs and corporations in § 441c is inconsistent with Citizens United (Pls.’ Mem. at 19-20) is 

exactly backward: corporations with federal contracts cannot make contributions, but PACs can, 

precisely because they are separate and distinct entities. As this Court explained (Mem. Op. 

at 25), “[i]ndividual federal contractors, accordingly, are not similarly situated to PACs or 

officers of contracting corporations; as a result, their disparate treatment does not present an 

equal-protection problem.” 

In addition, the notion that individual contractors lack a “direct and easy path” to make 

contributions is belied by the plaintiffs’ acknowledgment that they could establish a corporate 

form, such as an LLC, enter into contracts with the government through their LLC, and remain 

free to make contributions as individuals. (Plaintiffs’ Statement of Undisputed Material Facts ¶¶ 

5, 10-11 (Doc. 30-2).) This path is not meaningfully different from that of a corporation 

establishing an SSF. Plaintiffs claim that there are “significant costs” associated with 

establishing an LLC, but only reach that conclusion by hypothetically including the costs of 

lawyers and accountants (as well as LLC taxes that might otherwise be paid as individual taxes 

Case 1:11-cv-01841-JEB Document 33 Filed 08/15/12 Page 26 of 36
21 

in the absence of a corporate form). (Id. at ¶ 10.) But hiring these professionals would also drive 

up the costs of creating an SSF for a corporation. And in any event, it is unnecessary to take 

such elaborate measures to create an LLC. For example, Maryland requires only a one-page 

form and payment of $141. See Md. State Dep’t of Assessments and Taxation, Articles of 

Organization for LLC form and instructions, http://www.dat.state.md.us/sdatweb/artorgan.pdf. 

If corporate contractors have a “direct and easy” path to make contributions, then so do 

plaintiffs. 

III. CONCLUSION 

 For the reasons stated above — and for the reasons set forth in the Court’s opinion 

denying plaintiffs’ motion for a preliminary injunction — the Court should uphold 2 U.S.C. 

§ 441c and grant summary judgment to the Commission. 

Respectfully submitted, 

Anthony Herman (D.C. Bar No. 424643) 

General Counsel 

David Kolker (D.C. Bar No. 394558) 

Associate General Counsel 

Lisa J. Stevenson (D.C. Bar No. 457628) 

Special Counsel to the General Counsel 

Harry J. Summers 

Assistant General Counsel 

Holly J. Baker 

Attorney 

/s/ Seth Nesin 

Seth Nesin 

Attorney 

COUNSEL FOR DEFENDANT 

FEDERAL ELECTION COMMISSION 

999 E Street, NW 

Case 1:11-cv-01841-JEB Document 33 Filed 08/15/12 Page 27 of 36
22 

Washington, DC 20463 

Telephone: (202) 694-1650 

August 15, 2012 Fax: (202) 219-0260 

Case 1:11-cv-01841-JEB Document 33 Filed 08/15/12 Page 28 of 36
1 

UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF COLUMBIA 

_________________________________________ 

 ) 

WENDY E. WAGNER, et al., ) 

 ) 

Plaintiffs, ) 

) Civil Action No. 11-cv-1841-JEB 

 v. ) 

 ) STATEMENT OF 

FEDERAL ELECTION COMMISSION, ) GENUINE ISSUES 

 ) 

Defendant. ) 

_________________________________________ ) 

DEFENDANT FEDERAL ELECTION COMMISSION’S 

STATEMENT OF GENUINE ISSUES 

Pursuant to LCvR 7(h), defendant Federal Election Commission (“Commission” or 

“FEC”) respectfully submits the following Statement of Genuine Issues in response to Plaintiffs’ 

Statement of Undisputed Material Facts (Docket 30-2). 

1. Plaintiffs are individuals who currently have contracts with federal agencies under 

which they are providing personal services to an agency and for which payments are made from 

funds appropriated by Congress. Declaration of Wendy E. Wagner ¶ 3 (“Wagner ¶ __”); 

Declaration of Lawrence M. E. Brown ¶ 4, 5 (“Brown ¶ __”); & Declaration of Jan W. Miller ¶ 

4, 5 (“Miller ¶__). As such, they are subject to section 441c, under which it is unlawful for 

plaintiffs, as government contractors, to make any contribution to candidates for federal office 

and/or to political parties and/or political committees in connection with elections for federal 

offices. 

 FEC RESPONSE: No response. 

2. Each plaintiff has, prior to becoming a government contractor, made contributions 

to candidates for federal office and/or to political parties, and/or political committees in 

connection with elections for federal offices, either individually or jointly with his or her spouse. 

Wagner ¶ 6; Brown ¶ 6; Miller ¶ 7. Each plaintiff desires to make contributions in connection 

with federal elections, including the 2012 elections, but is barred from doing so by section 441c 

and will not do so unless protected by a court order. Wagner ¶ 6; Brown ¶ 6, 7, 8; & Miller ¶ 7. 

FEC RESPONSE: No response. 

Case 1:11-cv-01841-JEB Document 33 Filed 08/15/12 Page 29 of 36
2 

3. This action challenges the constitutionality of section 441c, which is a provision 

within FECA. The defendant is the Federal Election Commission (the “FEC”) which is the 

federal agency with the primary responsibility to enforce FECA, including section 441c. Each of 

the plaintiffs is a registered voter and is eligible to vote in federal elections in 2012. Wagner ¶ 6; 

Wagner Supplemental Declaration ¶ 2; Brown ¶ 1; Brown Supplemental Declaration ¶ 1; & 

Miller ¶1. This Court has jurisdiction over this action pursuant to 28 U.S.C. § 1331. 

FEC RESPONSE: With respect to the second sentence, the Commission notes that it 

has civil enforcement authority for FECA, and that the Department of Justice has criminal 

enforcement authority for the statute. No response to the remainder of the paragraph. 

4. The contracts under which the plaintiffs are performing personal services for their 

agencies were negotiated and signed by officials of those agencies. Wagner ¶ 3; Brown ¶ 5; 

Miller ¶ 6; Declaration of Jeffrey Lubbers ¶ ¶ 3, 4 (“Lubbers ¶ __”); Declaration of Jonathan 

Tiemann ¶ 4 (“Tiemann ¶__”); & Declaration of Steven L. Schooner ¶ 3 (“Schooner ¶__”). All 

of those officials were appointed and not elected to their positions. Neither the President, the 

Vice President, any Member of Congress, nor any official of any political party or political 

committee had any role in the negotiation, approval, or implementation of the contracts under 

which plaintiffs are performing personal services for their federal agencies. Wagner ¶ 3; Brown ¶ 

5; Miller ¶ 6; Schooner ¶ 3. 

FEC RESPONSE: No response to the first two sentences. With respect to the third 

sentence, the Commission notes that, although plaintiffs have stated that they are unaware of any 

involvement by the specified types of office holders or officials in the awarding or performance 

of their contracts, the record does not show that there was in fact no such involvement, and the 

record does reflect the involvement of at least one political appointee in the negotiation and 

performance of plaintiff Wagner’s contract, as well as interactions by plaintiffs Brown and 

Miller with at least one political appointee in the performance of their contracts. (Wagner ¶ 3 (“I 

was first approached about doing the work covered by my contract by Jonathan Siegel, the 

Research Director for ACUS. The other persons at ACUS with whom the contract was discussed 

before we reached an agreement included the Chairman, Paul Verkuil, who is appointed to that 

position by the President and confirmed by the Senate.”); Response of Wendy E. Wagner to FEC 

Request for Admission (“RFA”) Nos. 14, 15, Pls.’ App. at 40 (Wagner interacted with ACUS 

Case 1:11-cv-01841-JEB Document 33 Filed 08/15/12 Page 30 of 36
3 

Chairman in the negotiation and performance of her contract); Response of Jan W. Miller to FEC 

RFA No. 18, Pls.’ App. at 149 (Miller has interacted with at least one political appointee in the 

performance of his current federal contract); Response of Lawrence M.E. Brown to FEC RFA 

No. 18, Pls.’ App. at 61 (Brown has interacted with at least one political appointee in the 

performance of his current federal contract).) 

5. Federal agencies regularly enter into contracts with both individuals and 

corporations, including Limited Liability Companies (“LLCs”) that are essentially one person 

entities that have been incorporated. Schooner ¶¶ 6, 7. The agencies that utilize personal services 

contracts make no distinctions between contracts with individuals and with LLCs, provided that 

the services are rendered by the individuals specified. Id; Tiemann ¶ 5. 

FEC RESPONSE: With respect to the first sentence, the Commission notes that 

“regularly” is ambiguous. With respect to the second sentence, the record only indicates that the 

Department of Labor was willing to enter into a contract with Mr. Tiemann individually or with 

his LLC. (Tiemann ¶ 5.) The record does not make clear that agencies using personal services 

contracts generally make no distinctions between contracts with individuals and with LLCs. 

Professor Steven Schooner testified that he did not know whether retired annuitants, such as 

plaintiffs Miller and Brown, would be permitted to contract with the government through an 

LLC. (Deposition of Steven L. Schooner (“Schooner Dep.”) at 120.) 

6. Plaintiffs Brown and Miller and other individuals who provide similar services for 

their agencies work directly with employees of those agencies and perform the same types and 

kinds of services that employees perform. From an operational perspective, agencies generally 

treat employees and contracting individuals in the same manner. Brown ¶ 4; Miller ¶ 6; 

Lubbers ¶ 6. 

FEC RESPONSE: With respect to the first sentence, the Commission notes that the 

phrases “similar services” and “the same types and kinds of services” are ambiguous. With 

respect to the second sentence, the Commission notes that employees and federal contractors are 

treated differently in numerous respects, for example: (1) federal employees have clearly 

Case 1:11-cv-01841-JEB Document 33 Filed 08/15/12 Page 31 of 36
4 

established statutory civil service protections that federal contractors do not (Schooner Dep. 

at 72-73, 80); (2) federal contractors are often required to have email addresses and badges that 

distinguish them from employees, and contractors can even be required to answer the telephone 

in a different manner (Schooner Dep. at 73-74); and (3) the normal benefits that accompany 

federal employment are not typically given to contractors (Schooner Dep. at 75). 

7. Agency employees are not subject to the ban on contributions under section 441c, 

which applies to individual contractors such as plaintiffs. Most federal employees are permitted 

to make contributions in connection with federal elections unless “the person receiving such 

contribution is the employer or employing authority of the person making the contribution.” 18 

U.S.C. § 603. 

FEC RESPONSE: No response. 

8. Corporations that have contracts with federal agencies are also forbidden from 

making contributions in connection with federal elections, but subsection 441c(b) allows them to 

establish separate segregated funds to make such contributions. The costs of establishing and 

administering those separate funds, and of soliciting contributions to those funds, may be paid 

for by their corporate sponsor, whose name is required by 2 U.S.C. § 432(e)(5) to be part of the 

name of the fund. Individuals such as plaintiffs are not permitted to establish such funds, and the 

ban in section 441c applicable to individuals applies even where the money for a contribution 

comes from an independent source and not from their earnings under a government contract. 

FEC Advisory Opinion 2008-11 (Exhibit B to Brown Declaration). 

FEC RESPONSE: No response. 

9. The prohibition in section 441c on corporate contributions applies only to the 

corporation itself and does not apply to individuals who are directors, officers, employees, or 

stockholders of the corporation, including corporations for which an individual is the sole 

officer, employee, and stockholder. FEC Advisory Opinion 2008-11. Such directors, officers, 

employees, and stockholders may make contributions in connection with federal elections to 

candidates, political committees, and political parties using funds that were earned by the 

corporation from a government contract and paid as salary and/or dividends to such directors, 

officers, employees, and/or stockholders making the contribution. Id.

FEC RESPONSE: No response. 

10. If a plaintiff established an LLC or other similar corporate entity, and if the 

plaintiff’s agency were willing to have its contract be with the plaintiff’s corporation and not 

with the plaintiff individually, only the corporation would remain subject to section 441c. Id. 

There are significant costs involved in establishing and maintaining an LLC, which include the 

fee charged by the state for incorporation, fees charged by lawyers or others to do the 

Case 1:11-cv-01841-JEB Document 33 Filed 08/15/12 Page 32 of 36
5 

incorporation, annual fees paid to the state for retaining the corporate license, fees charged to 

accountants or others to prepare the tax returns for the LLC, and any taxes that the LLC might 

owe in addition to the taxes owed by the owner of the LLC. Tiemann ¶ 3; Deposition of Steven 

L. Schooner (“Schooner Dep.) at 118-19. 

FEC RESPONSE: No response to the first sentence. With respect to the second 

sentence, the term “significant costs” is ambiguous, and several of the costs identified in the 

sentence are not necessary components of incorporating as an LLC. For example, establishing 

an LLC in Maryland requires only a one-page form and payment of $141. See Md. State Dep’t 

of Assessments and Taxation, Articles of Organization for LLC form and instructions, 

http://www.dat.state.md.us/sdatweb/artorgan.pdf. 

11. Federal agencies are generally indifferent to whether a contract to provide 

services to the agency is with the individual who will perform such services or with his or LLC, 

provided that it is clear that the individual (the key personnel) will be providing the contractedfor services. Lubbers ¶ 8; Schooner ¶ 8; Tiemann ¶ 5; Schooner Dep. at 118-19. 

FEC RESPONSE: The Commission incorporates its Response to proposed Fact No. 5, 

supra. 

12. Neither section 441c nor any other federal law bans individuals who receive other 

kinds of payments from money appropriated by Congress from making political contributions in 

connection with federal elections. Such other payments including those set forth in 2 C.F.R. 

§ 180.970 (2010), such as grants, loans, loan guarantees, subsidies, and “payments for specified 

uses.” Plaintiff Wagner has a grant of $45,721 from the National Science Foundation (Wagner 

¶ 4), but that does not bar her from making political contributions as does section 441c. 

FEC RESPONSE: Regarding the first sentence, the Commission notes that foreign 

nationals may receive money appropriated by Congress and that 2 U.S.C. § 441e prohibits them 

from making contributions or donations in connection with federal, state, or local elections. No 

response to the second or third sentences. 

13. Plaintiffs Brown and Miller are retired federal civil servants who now have 

contracts with the agency (USAID) by which they were formerly employed. Brown ¶ ¶ 3-5; 

Miller ¶¶ 4-6. They regularly work alongside of federal civil service employee doing the same 

kind of work that the regular employees do. Id. Plaintiff Wagner is a fulltime law professor who 

Case 1:11-cv-01841-JEB Document 33 Filed 08/15/12 Page 33 of 36
6 

was contacted by the agency with which she has a contract to undertake a study and make a 

report on an issue on which the agency wanted her expert advice. Wagner ¶¶ 2-3. 

FEC RESPONSE: No response. 

14. The contracting officers that have the authority over federal contracts are 

specially trained for their positions, their decisions are made independently and based only on 

factors relevant to the contract at issue, and there is supposed to be no involvement of elected 

officials in those decisions. Schooner Dep. at 24-28, 51-54, 56-60, 94-98, 109-116, & 137. 

FEC RESPONSE: The Commission objects to this proposed Fact as incomplete, 

partially inconsistent with the record, and ambiguous in its use of the phrases “relevant to the 

contract” and “supposed to be.” While contracting officers are trained to award contracts in a 

non-political manner, the contracting officer generally “must rely on the expertise and 

information” of other employees in the award of a contract. (Schooner Dep. at 110-112.) 

Furthermore, normal competitive bidding procedures may be bypassed in the case of 

“a fundamental group of core exemptions” such as “the classic public interest and national 

security exemptions” or “if there is an industry where prices are set by law or regulation.” 

(Schooner Dep. at 27-28.) There are also streamlined procedures for certain types of contracts 

— for example, an agency awarding a contract to an expert witness or an alternative dispute 

resolution mediator need not go through the ordinary procedures. (Schooner Dep. at 24-26, 

29-30; Tiemann ¶ 4 (“All of my discussions prior to signing the contract and since then have 

been with attorneys in the Solicitor’s Office, although eventually a person designated as a 

contracting officer signed the contract”).) Indeed, the current ACUS contract of plaintiff Wagner 

appears to have been the result of such a streamlined procedure. (1st Wagner Decl. ¶ 3; Wagner 

Response to FEC RFA Nos. 14, 15, Pls.’ App. at 40.) And the awarding of personal service 

contracts like those of plaintiffs Brown and Miller is not “subject to full and open competition 

and the full range of rights and responsibilities that follow that.” (Schooner Dep. at 89; see also 

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7 

id. at 87.) As a result, the award and performance of these contracts is not even “evaluated by a 

contracting officer.” (Id. at 104.) Furthermore, for all contracts of less than $150,000 (or even 

higher value contracts in some instances) “there are streamlined competitions, where the 

government can call two or three people on the phone and operate in a very informal manner.” 

(Id. at 107.) “[T]here are many types of smaller contracts that have very flexible award 

authorities.” (Id. at 108.) 

In fact, the FEC’s Statement of Material Facts includes many examples of federal 

contracting decisions that appear not to have been made solely on the basis of legitimate factors. 

(FEC Facts ¶¶ 105-114.) Moreover, plaintiffs have admitted that federal officeholders and 

political appointees have in fact influenced the selection of federal contractors, including 

individual contractors (Wagner Response to FEC RFA Nos. 1-2, Pls.’ App. at 37-38; Brown 

Response to FEC RFA Nos. 1-2, Pls.’ App. at 58; Miller Response to FEC RFA 1-2, Pls.’ App. 

at 146-47); that at least one political appointee was involved in the negotiation and performance 

of plaintiff Wagner’s current contract (Wagner Response to FEC RFA Nos. 14, 15, Pls.’ App. at 

40); and that plaintiffs Brown and Miller interacted with at least one political appointee in the 

performance of their current contracts (Brown Response to FEC RFA No. 18, Pls.’ App. at 61; 

Miller Response to FEC RFA No. 18, Pls.’ App. at 149). 

 

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8 

 Respectfully submitted, 

Anthony Herman 

General Counsel 

 

David Kolker (D.C. Bar No. 394558) 

Associate General Counsel 

Lisa J. Stevenson (D.C. Bar No. 457628) 

Special Counsel to the General Counsel 

 

Harry J. Summers 

Assistant General Counsel 

Holly J. Baker 

Attorney 

/s/ Seth Nesin 

Seth Nesin 

 Attorney 

 

COUNSEL FOR DEFENDANT 

FEDERAL ELECTION COMMISSION 

999 E Street NW 

 Washington, DC 20463 

August 15, 2012 (202) 694-1650 

 

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