i 

UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF COLUMBIA 

__________________________________________ 

 ) 

CITIZENS FOR RESPONSIBILITY AND ) 

ETHICS IN WASHINGTON, et al., ) 

 ) 

 Plaintiffs, ) 

 ) 

 v. ) Civil Action No. 16-00259 (BAH) 

 ) 

FEDERAL ELECTION COMMISSION, ) 

 ) 

 Defendant, ) 

 ) 

CROSSROADS GRASSROOTS POLICY ) 

STRATEGIES, ) 

 ) 

Intervenor-Defendant. ) 

__________________________________________) 

PLAINTIFFS’ MOTION FOR SUMMARY JUDGMENT 

The Plaintiffs, Citizens for Responsibility and Ethics in Washington (“CREW”) and 

Nicholas Mezlak, by their undersigned counsel, respectfully move this Court, pursuant to Federal 

Rule of Civil Procedure 56, for summary judgment declaring that the failure of the Federal 

Election Commission (“FEC”) to find “reason to believe” that Crossroads Grassroots Policy 

Strategies (“Crossroads GPS”), Steven Law, Karl Rove, Haley Barbour, and Caleb Crosby 

violated the Federal Election Campaign Act (“FECA”), 52 U.S.C. § 30101 et seq., was contrary 

to law, and directing the FEC to conform with such declaration within 30 days consistent with 

the Court’s judgment. Plaintiffs further seek by this motion an order declaring as invalid and 

vacating 11 C.F.R. § 109.10(e)(1)(vi) as inconsistent with the FECA. 

Support for this motion is set forth in the accompanying Memorandum of Points and 

Case 1:16-cv-00259-BAH Document 27 Filed 09/11/17 Page 1 of 55
ii 

Authorities in Support of Plaintiffs’ Motion for Summary Judgment and the joint appendix 

containing copies of those portions of the administrative record that are cited or otherwise relied 

upon, to be filed no later than January 19, 2018. Plaintiffs’ requested relief is set forth in the 

accompanying Proposed Order. Plaintiffs respectfully request oral argument on this motion. 

Dated: September 11, 2017. 

Respectfully submitted, 

/s/ Stuart C. McPhail 

Stuart C. McPhail 

smcphail@citizensforethics.org

(D.C. Bar No. 1032529) 

Adam J. Rappaport 

arappaport@citizensforethics.org

(D.C. Bar No. 479866) 

Citizens for Responsibility and Ethics 

in Washington 

455 Massachusetts Ave., N.W., Sixth Floor 

Washington, D.C. 20001 

Telephone: (202) 408-5565 

Fax: (202) 588-5020 

Attorneys for Citizens for Responsibility and 

Ethics in Washington and Nicholas 

Mezlak 

Case 1:16-cv-00259-BAH Document 27 Filed 09/11/17 Page 2 of 55
i 

UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF COLUMBIA 

__________________________________________ 

 ) 

CITIZENS FOR RESPONSIBILITY AND ) 

ETHICS IN WASHINGTON, et al., ) 

 ) 

 Plaintiffs, ) 

 ) 

 v. ) Civil Action No. 16-00259 (BAH) 

 ) 

FEDERAL ELECTION COMMISSION, ) 

 ) 

 Defendant, ) 

 ) 

CROSSROADS GRASSROOTS POLICY ) 

STRATEGIES, ) 

 ) 

Intervenor-Defendant. ) 

__________________________________________) 

MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF 

PLAINTIFFS’ MOTION FOR SUMMARY JUDGMENT 

 

Case 1:16-cv-00259-BAH Document 27 Filed 09/11/17 Page 3 of 55
ii 

TABLE OF CONTENTS 

TABLE OF AUTHORITIES ............................................................................................................................ I

INTRODUCTION ................................................................................................................................................. 1 

STATEMENT OF FACTS ................................................................................................................................ 3 

I. CURRENT STATUTORY AND REGULATORY BACKGROUND .............................................................. 3 

A. FECA’s Independent Expenditure Disclosure Requirements ................................................ 3 

B. Enforcement ......................................................................................................................................... 6 

II. HISTORY OF THE CHALLENGED REGULATION ..................................................................................... 7 

A. FECA Prior to the 1979 Amendments .......................................................................................... 7 

B. The 1979 FECA Amendments ......................................................................................................... 9 

C. The FEC’s Rulemaking Process ................................................................................................... 10 

D. Impact of the Rule ............................................................................................................................ 13 

III. THE ADMINISTRATIVE PROCEEDINGS BELOW .................................................................................. 17 

A. CREW’s Substantiated Allegations ............................................................................................. 18 

B. The FEC’s Proceedings .................................................................................................................. 22 

ARGUMENT ......................................................................................................................................................... 26 

I. JURISDICTION ............................................................................................................................................. 26 

II. STANDARD OF REVIEW ............................................................................................................................ 26 

III. 11 C.F.R. § 109.10(E)(1)(VI) IS UNEXPLAINED, INEXPLICABLE, AND INVALID ........................ 28 

A. The Regulation Cannot Be Valid Because the FEC Failed to Explain 

Its Narrowing of Disclosure Required by the Statute ............................................................ 28 

B. The Regulation Conflicts with the Unambiguous Terms of the FECA ............................. 30 

1. The Regulation Fails Chevron Step-One ...................................................... 31 

2. The Regulation Fails Chevron Step-Two ..................................................... 33 

IV. THE FEC’S DISMISSAL OF THE SUBSECTION (C)(2)(C) VIOLATION WAS 

CONTRARY TO LAW ................................................................................................................................. 38 

V. SUBSECTION (C)(1) IMPOSES “ADDITIONAL” DISCLOSURE OBLIGATIONS AND 

THE FEC’S FAILURE TO ENFORCE WAS CONTRARY TO LAW ........................................................ 39 

VI. THE FEC’S FAILURE TO FIND REASON TO BELIEVE 11 C.F.R. § 109.10(E)(1)(VI)

MAY HAVE BEEN VIOLATED WAS CONTRARY TO LAW ................................................................. 44 

CONCLUSION ..................................................................................................................................................... 45 

 

Case 1:16-cv-00259-BAH Document 27 Filed 09/11/17 Page 4 of 55
i 

TABLE OF AUTHORITIES 

Cases

Aragon v. Tillerson, 240 F. Supp. 3d 99 (D.D.C. 2017) ......................................................... 29, 30 

Barnett v. Weinberger, 818 F.2d 953 (D.C. Cir. 1987) ................................................................ 39 

Barnhart v. Walton, 535 U.S. 212 (2002) ..................................................................................... 31 

Buckley v. Valeo, 424 U.S. 1 (1976) ......................................................................................... 3, 34 

Burlington Truck Lines, Inc. v. United States, 371 U.S. 156 (1962) ............................................ 27 

Chevron U.S.A., Inc. v. NRDC, 467 U.S. 837 (1984) ............................................................. 26, 32 

Citizens United v. FEC, 558 U.S. 310 (2010) ......................................................................... 14, 34 

Common Cause v. FEC, 842 F.2d 436 (D.C. Cir. 1988) .............................................................. 28 

CREW v. FEC, 209 F. Supp. 3d 77 (D.D.C. 2016) ....................................................................... 38 

Engine Mfrs. Ass’n v. EPA, 88 F.3d 1075 (D.C. Cir. 1996) ......................................................... 31 

FCC v. Fox Television Stations, Inc., 567 U.S. 239 (2012).......................................................... 43 

FEC v. Akins, 524 U.S. 11 (1998) ................................................................................................. 26 

FEC v. Democratic Senatorial Campaign Comm., 454 U.S. 27 (1981) ....................................... 28 

FEC v. Hsia, 176 F.3d 517 (D.C. Cir. 1999) ................................................................................ 37 

*FEC v. Mass. Citizens for Life, Inc. (“MCFL”), 479 U.S. 238 (1986) ............................... passim 

FEC v. Nat’l Republican Senatorial Comm., 966 F.2d 1471 (D.C. Cir. 1992) ............................ 28 

FEC v. Wisc. Right to Life, 551 U.S. 449 (2007) .................................................................... 14, 32 

Freeman United Coal Min. Co. v. Fed. Mine Safety and Health Review Comm’n, 

108 F.3d 358 (D.C. Cir. 1997) .................................................................................................. 39 

GE v. EPA, 53 F.3d 1324 (D.C. Cir. 1995)................................................................................... 43 

Grayned v. City of Rockford, 408 U.S. 104 (1972) ...................................................................... 42 

Holder v. Humanitarian Law Project, 561 U.S. 1 (2010) ............................................................ 42 

Kungys v. United States, 485 U.S. 759 (1988).............................................................................. 35 

Case 1:16-cv-00259-BAH Document 27 Filed 09/11/17 Page 5 of 55
ii 

McConnell v. FEC, 540 U.S. 93 (2003) .................................................................................. 34, 42 

Motor Vehicle Mfrs. Ass’n of U.S. v. State Farm Mut. Auto Ins. Co., 463 U.S. 29 (1983) .... 27, 29 

Mylan Pharmaceuticals, Inc. v. Shalala, 81 F. Supp. 2d 30 (D.D.C. 2000)................................. 32 

N. Air. Cargo v. U.S. Postal Serv., 674 F.3d 852 (D.C. Cir. 2012) .............................................. 27 

Nader v. FEC, 823 F. Supp. 2d 53 (D.D.C. 2011) ........................................................................ 43 

Nat’l Mining Ass’n v. U.S. Army Corps of Eng’rs, 145 F.3d 1399 (D.C. Cir. 1998) ............. 29, 38 

Nat’l Treasury Emps. Union v. Hove, 840 F. Supp. 165 (D.D.C. 1994) ...................................... 34 

Oceana, Inc. v. Locke, 674 F. Supp. 2d 39 (D.D.C. 2009) ........................................................... 34 

Orloski v. FEC, 795 F.2d 156 (D.C. Cir. 1986) ...................................................................... 27, 38 

Public Citizen, Inc. v. FAA, 988 F.2d 186 (D.C. Cir. 1993) ......................................................... 29 

Robinson v. Shell Oil Co., 519 U.S. 337 (1997) ........................................................................... 31 

Satellite Broadcasting Co., Inv. v. FCC, 824 F.2d 1 (D.C. Cir. 1987) ......................................... 43 

SEC v.Chenery Corp., 318 U.S. 80 (1943) ................................................................................... 27 

Shays v. FEC, 337 F. Supp. 2d 28 (D.D.C. 2004) ........................................................................ 35 

*Shays v. FEC, 414 F.3d 76 (D.C. Cir. 2005) ....................................................................... passim 

*Shays v. FEC, 528 F.3d 914 (D.C. Cir. 2008) ................................................................ 29, 33, 34 

Sierra Club v. Van Antwerp, 719 F. Supp. 2d 77 (D.D.C. 2010) ................................................. 29 

Suburban Air Freight, Inc. v. Transp. Sec. Admin, 716 F.3d 679 (D.C. Cir. 2013) ..................... 40 

United States v. Williams, 553 U.S. 285 (2008) ........................................................................... 42 

Van Hollen v. FEC, 811 F.3d 486 (D.C. Cir. 2016) ......................................................... 32, 33, 34 

Williams Gas Processing – Gulf Coast Co., L.P. v. FERC, 373 F.3d 1335 

(D.C. Cir. 2004) ........................................................................................................................ 27 

Statutes

2 U.S.C. § 431(e) (1976) ................................................................................................................. 8 

2 U.S.C. § 434(b) (1976) ................................................................................................................ 8 

Case 1:16-cv-00259-BAH Document 27 Filed 09/11/17 Page 6 of 55
iii 

2 U.S.C. § 434(b)(3)(A) (1982) .................................................................................................... 11 

2 U.S.C. § 434(c)(1) (1982) .................................................................................................... 11, 13 

2 U.S.C. § 434(c)(2)(C) (1982) ......................................................................................... 11, 12, 13 

2 U.S.C. § 434(e) (1976) ................................................................................................................. 8 

2 U.S.C. § 434(e)(1) (1976) ............................................................................................................ 7 

2 U.S.C. § 441b (2010) ................................................................................................................. 14 

5 U.S.C. § 551 ............................................................................................................................... 26 

5 U.S.C. § 706 ............................................................................................................................... 26 

28 U.S.C. § 1331 ........................................................................................................................... 26 

28 U.S.C. § 1391(e) ...................................................................................................................... 26 

52 U.S.C. § 30101 ......................................................................................................................... 26 

52 U.S.C. § 30101(17) .................................................................................................................... 3 

52 U.S.C. § 30101(4) ...................................................................................................................... 5 

52 U.S.C. § 30101(8)(A)(i) ......................................................................................................... 3, 8 

52 U.S.C. § 30104 ......................................................................................................................... 22 

*52 U.S.C. § 30104(b)(3)(A) ................................................................................................. passim 

52 U.S.C. § 30104(b)(3)(B) .......................................................................................................... 37 

52 U.S.C. § 30104(c) .................................................................................................................. 1, 3 

*52 U.S.C. § 30104(c)(1) ....................................................................................................... passim 

*52 U.S.C. § 30104(c)(2)(C) ................................................................................................. passim 

52 U.S.C. § 30104(f)(2) ................................................................................................................ 32 

52 U.S.C. § 30104(f)(3) .................................................................................................................. 5 

52 U.S.C. § 30106 ........................................................................................................................... 6 

52 U.S.C. § 30109(a)(1) .................................................................................................................. 6 

Case 1:16-cv-00259-BAH Document 27 Filed 09/11/17 Page 7 of 55
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52 U.S.C. § 30109(a)(2) ............................................................................................................ 6, 45 

52 U.S.C. § 30109(a)(3) .................................................................................................................. 6 

52 U.S.C. § 30109(a)(4)(A) ............................................................................................................ 6 

52 U.S.C. § 30109(a)(6) ................................................................................................................ 43 

52 U.S.C. § 30109(a)(6)(A) ............................................................................................................ 6 

52 U.S.C. § 30109(a)(8)(C) ................................................................................................ 7, 26, 44 

52 U.S.C. § 30109(d) .................................................................................................................... 43 

52 U.S.C. § 30120(a)(3) ................................................................................................................ 36 

Federal Election Campaign Act Amendments of 1979, Pub. L. 96-187 § 303 (1980) ......... 7, 9, 10 

Regulations

11 C.F.R. § 100.5(a)........................................................................................................................ 5 

11 C.F.R. § 100.16 .......................................................................................................................... 3 

11 C.F.R. § 100.22 .......................................................................................................................... 3 

11 C.F.R. § 100.29 .......................................................................................................................... 5 

11 C.F.R. § 104.1 ............................................................................................................................ 5 

11 C.F.R. § 104.3 .................................................................................................................. 5, 6, 37 

11 C.F.R. § 104.4 ............................................................................................................................ 6 

11 C.F.R. § 104.20 .......................................................................................................................... 5 

11 C.F.R. § 104.20(c)(9) ............................................................................................................... 32 

11 C.F.R. § 109.10 .................................................................................................................. 22, 25 

11 C.F.R. § 109.10(a)...................................................................................................................... 6 

11 C.F.R. § 109.10(b) ......................................................................................................... 3, 35, 36 

11 C.F.R. § 109.10(e)...................................................................................................................... 3 

11 C.F.R. § 109.10(e)(1)(vi) .................................................................................................. passim 

Case 1:16-cv-00259-BAH Document 27 Filed 09/11/17 Page 8 of 55
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11 C.F.R. § 110.1(a)...................................................................................................................... 37 

11 C.F.R. § 110.1(b)(1) ................................................................................................................. 37 

11 C.F.R. § 110.1(b)(6) ................................................................................................................. 37 

11 C.F.R. § 110.11(b) ................................................................................................................... 36 

Rules

FED. R. CIV. P. 8(c)(6) ................................................................................................................... 18 

FED. R. EVID. 201 notes ................................................................................................................ 34

Other Authorities

FEC, AO 2008-10 (Votervoter.com) (Oct. 24, 2008) ................................................................... 36 

FEC, Coordinated and Independent Expenditures, 67 Fed. Reg. 60042-01 (Sept. 24, 2002) ...... 13 

FEC, Coordinated and Independent Expenditures, 68 Fed. Reg. 421-01 (Jan. 3, 2003) .............. 13 

FEC, Independent Expenditures and Electioneering Communications by Corporations 

and Labor Organizations, 79 Fed. Reg. 62797-02 (Oct. 21, 2014) .......................................... 14 

FEC, Statement of Policy Regarding Commission Action in Matters at the Initial Stage 

in the Enforcement Process, 72 Fed. Reg. 12545 (Mar. 16, 2007) ............................................. 6 

Legislative History of Federal Election Campaign Act Amendments of 1979 (1983) .......... passim 

Case 1:16-cv-00259-BAH Document 27 Filed 09/11/17 Page 9 of 55
1 

INTRODUCTION 

This lawsuit challenges the Federal Election Commission’s (“FEC”) dismissal of the 

complaint filed by Citizens for Responsibility and Ethics in Washington and Nicholas Mezlak 

(together “CREW”) against Crossroads Grassroots Policy Strategies (“Crossroads GPS”), Steven 

Law, Karl Rove, Haley Barbour, and Caleb Crosby. The FEC dismissed CREW’s complaint 

despite finding that Crossroads GPS accepted a contribution in excess of $3 million for the 

purpose of supporting Crossroads GPS’s work—primarily consisting of disseminating explicit 

campaign ads—to elect a Senate candidate in Ohio, accepted over $1 million in matching grants 

to help Crossroads GPS reach its fundraising goal for its Ohio campaign work, and collected an 

unknown amount of money from attendees at a Tampa fundraiser who were shown Crossroads 

GPS’s previous ads as “examples” of the type of political activity their contributions would go to 

fund. Despite collecting all this money and spending significant sums in Ohio and in other 

Senate races to elect its chosen candidates, Crossroads GPS did not disclose a single cent of its 

contributions, notwithstanding the Federal Election Campaign Act’s (“FECA”) requirements for 

those making independent expenditures to disclose their contributors. 52 U.S.C. § 30104(c). 

The FEC reached this remarkable conclusion because it relied on a regulation, 11 C.F.R. 

§ 109.10(e)(1)(vi), adopted in haste long before the heady days of multi-million dollar election 

campaigns by outside groups, that inexplicably narrowed 52 U.S.C. § 30104(c)(2)(C)’s plain 

reporting requirement to the point of nullification. Instead of reflecting the statute’s obligation to 

identify contributors who gave for the purpose of furthering “an” independent expenditure, the 

FEC’s regulation only requires disclosing those who contributed for the purpose of furthering 

“the reported” independent expenditure. The rule has so frustrated the FECA’s basic reporting 

requirements that voters now rarely, if ever, learn the identities of the contributors for 

Case 1:16-cv-00259-BAH Document 27 Filed 09/11/17 Page 10 of 55
2 

independent expenditure ads subject to this provision. 

The regulation, and thus the dismissal of CREW’s complaint based on it, is invalid under 

the Administrative Procedure Act (“APA”). It was adopted without any explanation, it conflicts 

with the unambiguous terms of the FECA, it frustrates the FECA’s goal of ensuring an informed 

electorate, and it renders disclosure of independent expenditure contributions a nullity. 

In addition, the regulation does not even capture the FECA’s full reporting obligations for 

those making independent expenditures, as the FEC recognized below. To ensure voters have a 

complete picture of the those financially backing candidates, the FECA not only requires the 

disclosure of individuals giving for the purpose of funding a group’s independent expenditures, 

but it also requires disclosure of “all contributors who annually provide in the aggregate $200 in 

funds intended to influence elections.” FEC v. Mass. Citizens for Life, Inc. (“MCFL”), 479 U.S. 

238, 262 (1986) (summarizing 52 U.S.C. § 30104(c)(1)). There is no dispute that Crossroads 

GPS failed to disclose contributions it received during the year prior to its running independent 

expenditures. Yet the FEC refused to enforce the law—denying CREW and millions of voters 

vital information—contending that Crossroads GPS may not have had “fair notice” of the text of 

the statute. Of course, a sophisticated group like Crossroads GPS, capable of affording tens of 

millions of dollars in election spending, can read a statute: in fact, the group has emphasized 

from the beginning that it knows the reporting rules better than the FEC. 

There is no reason to excuse Crossroads GPS from its reporting obligations under the 

FECA. The FECA’s reporting obligations for independent expenditures serve a vital role in our 

democracy, yet they have been evaded due to invalid regulation and a feckless FEC. CREW 

brings this action to correct those errors and to ensure voters are no longer denied the 

information to which they are rightfully entitled. 

Case 1:16-cv-00259-BAH Document 27 Filed 09/11/17 Page 11 of 55
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STATEMENT OF FACTS 

I. Current Statutory and Regulatory Background 

A. FECA’s Independent Expenditure Disclosure Requirements 

The FECA and FEC regulations impose a number of disclosure requirements on persons 

who make campaign-related expenditures. Relevant to this matter, they impose certain one-time 

disclosure requirements on groups or individuals that make a particularly explicit form of 

campaign-related communication. These ads, called “independent expenditures,” are 

expenditures for communications not coordinated with candidates that “expressly advocat[e] the 

election or defeat of a clearly identified candidate.” 52 U.S.C. § 30101(17); 11 C.F.R. § 100.16. 

“Express advocacy” are communications using phrases like “vote for,” “re-elect,” “support,” or 

“Smith for Congress,” and ads that, “in context, have no other reasonable meaning than to urge 

the election or defeat of one or more clearly identified candidate(s).” 11 C.F.R. § 100.22. 

Pursuant to the FECA and FEC regulations, anyone spending more than $250 on an 

independent expenditure must file a report with the Commission. 52 U.S.C. § 30104(c)(1); 11 

C.F.R. § 109.10(b). The report must detail a number of items about the communication 

including, as relevant here, information identifying persons who made contributions to the entity 

making the independent expenditure. 52 U.S.C. § 30104(c); 11 C.F.R. § 109.10(e). A 

contribution is a “gift, subscription, loan, advance, or deposit of money or anything of value 

made by any person for the purpose of influencing any election for Federal office.” 52 U.S.C. 

§ 30101(8)(A)(i); Buckley v. Valeo, 424 U.S. 1, 78 (1976) (construing “contribution” under 

FECA to mean “not only contributions made directly or indirectly to a candidate, political party, 

or campaign committee” but also “contributions made to other organizations or individuals but 

earmarked for political purposes”). 

Case 1:16-cv-00259-BAH Document 27 Filed 09/11/17 Page 12 of 55
4 

Under the FECA, any person making an independent expenditure must make two 

disclosures with respect to contributors. First, pursuant to 52 U.S.C. § 30104(c)(2)(C), 

previously codified as 2 U.S.C. § 434(c)(2)(C), the report must include “the identification of 

each person who made a contribution in excess of $200 to the person filing such statement which 

was made for the purpose of furthering an independent expenditure.” Secondly, pursuant to 52 

U.S.C. § 30104(c)(1), the report must also include “the information required under subsection 

(b)(3)(A) for all contributions received by” the person making the independent expenditure. 52 

U.S.C. § 30104(c)(1) (emphasis added). In turn, subsection (b)(3)(A) requires “the identification 

of each . . . person . . . who makes a contribution to the reporting [party] . . . , whose 

contribution or contributions have an aggregate amount or value in excess of $200 within the 

calendar year . . . , together with the date and amount of any such contribution.” Id.

§ 30104(b)(3)(A). Notably, subsection (c)(1) does not limit reportable contributions to those 

given for the purpose of funding independent expenditures—rather, it captures “all” 

contributions over $200, so long as they were made within a year of the reported expenditure. 

Accordingly, the FECA requires disclosure of two different yet complimentary sets of 

contributions to those making independent expenditures. While both require disclosure of only 

those making contributions—those giving funds to the reporting entity for the purpose of 

influencing an election—each subsection captures a slightly different set of contributions that are 

useful to viewers of independent expenditures. Subsection (c)(1) provides a temporal scope for 

contribution disclosures: “all contributors who annually provide in the aggregate $200 in funds 

intended to influence elections.” MCFL, 479 U.S. at 262. Subsection (c)(2)(C) provides a 

purposive scope for contribution disclosure: “all persons making contributions over $200 who 

request that the money be used for independent expenditures.” See id. Combined, they ensure 

Case 1:16-cv-00259-BAH Document 27 Filed 09/11/17 Page 13 of 55
5 

voters have a complete picture of the financial backing for the express advocacy aimed at them. 

Relevant to this case, however, the FEC has adopted a regulation only encompassing 

subsection (c)(2)(C) disclosure, and the regulation conflicts with even that provision. According 

to FEC regulations, any person making an independent expenditure must provide “[t]he 

identification of each person who made a contribution in excess of $200 to the person filing such 

report, which contribution was made for the purpose of furthering the reported independent 

expenditure.” 11 C.F.R. § 109.10(e)(1)(vi) (emphasis added). Section 109.10(e)(1)(vi) reflects 

only the purposive scope of disclosure required by 52 U.S.C. § 30104(c)(2), but does not cover 

the separate disclosure required by 52 U.S.C. § 30104(c)(1). It also materially conflicts with the 

statute because, while the FECA requires disclosure of all contributions “made for the purpose of 

furthering an independent expenditure,” 52 U.S.C. § 30104(c)(2)(C), the FEC regulation requires 

only the disclosure of a contribution “made for the purpose of furthering the reported

independent expenditure,” 11 C.F.R. § 109(e)(1)(vi). As detailed below, that change in language 

has effectively eliminated contributor disclosure. 

In addition to disclosure of independent expenditures, the FECA also requires other types 

of disclosure. First, the FECA requires those making electioneering communications—broadcast 

ads that stop short of express advocacy but clearly identify a federal candidate, are targeted to the 

candidate’s electorate, and air shortly before the candidate’s election—to file similar one-time 

disclosure reports with the FEC also disclosing contributions used to fund such communications. 

52 U.S.C. § 30104(f)(3), 11 C.F.R. §§ 100.29, 104.20. Second, the FECA requires certain 

organizations that engage in extensive politicking, termed “political committees,” to file periodic 

reports with the FEC. 52 U.S.C. §§ 30101(4), 30104(b); 11 C.F.R. §§ 100.5(a), 104.1, 104.3. 

Political committees may engage in independent expenditures and report those expenditures in 

Case 1:16-cv-00259-BAH Document 27 Filed 09/11/17 Page 14 of 55
6 

their periodic reports. 11 C.F.R. §§ 104.3(b)(1)(vii), 104.4, 109.10(a). Those reports also 

disclose the contributors to those political committees and thus disclose the funds used to create 

the independent expenditures. Id. §104.3(a). For a group that does not qualify as a political 

committee but that nonetheless makes independent expenditures—like Crossroads GPS—the 

one-time independent expenditure reports are the only information voters will have about who is 

funding its ads. 

B. Enforcement 

The FECA places preliminary responsibility for enforcing federal campaign finance laws, 

including disclosure requirements, with the FEC. 52 U.S.C. § 30106. Third parties, however, 

may file a complaint with the FEC if they identify a violation of the statute. 52 U.S.C. 

§ 30109(a)(1). After a response from the alleged violator and a report from the FEC’s Office of 

General Counsel (“OGC”), the six commissioners of the FEC then vote on whether they find 

“reason to believe” a violation “may” have occurred. Id. § 30109(a)(2); FEC, Statement of 

Policy Regarding Commission Action in Matters at the Initial Stage in the Enforcement Process, 

72 Fed. Reg. 12545, 12545 (Mar. 16, 2007). The “reason to believe” standard is very low; it 

asks only whether a violation “may” have occurred based on the “credibl[e] alleg[ations]” of the 

complaint. 72 Fed. Reg. at 12545. If four commissioners find reason to believe, the OGC will 

investigate and then make a recommendation whether there is probable cause. 52 U.S.C.

§ 30109(a)(2), (3). If four commissioners find probable cause, the FEC must then seek 

conciliation with the respondents; if the FEC is “unable” to reach a conciliation agreement, the 

FEC may pursue a civil action in court. Id. § 30109(a)(4)(A), (6)(A). 

If the FEC does not pursue enforcement, the FECA empowers the complainant to “bring, 

in the name of such complainant, a civil action to remedy the violation involved in the original 

Case 1:16-cv-00259-BAH Document 27 Filed 09/11/17 Page 15 of 55
7 

complaint.” Id. § 30109(a)(8)(C). The complainant may only bring that action, however, if, 

after presenting its complaint to the FEC, the FEC fails to enforce, the complainant receives a 

judicial declaration that the failure to enforce permits activity “contrary to law,” and then the 

FEC fails to “conform” with the declaration within thirty days. Id. 

II. History of the Challenged Regulation 

The regulation at issue in this case, 11 C.F.R. § 109.10(e)(1)(vi), went into effect on 

April 1, 1980. AR 1553. The regulation was part of several new rules that were needed due to 

amendments to the FECA passed by Congress in the previous year. AR 1002. Indeed, the 

regulations were needed in a very short time frame: the President signed the amendments into 

law on January 8, 1980, see Legislative History of Federal Election Campaign Act Amendments 

of 1979 at 573 (1983) (“1979 FECA History”), https://transition.fec.gov/pdf/legislative_hist 

/legislative_history_1979.pdf, and Congress directed the FEC to draft new rules and regulations 

by February 29, 1980, Federal Election Campaign Act Amendments of 1979, Pub. L. 96-187 

§ 303 (1980); AR 1002. As described below, however, that quick turnaround led the FEC to 

make errors in drafting. In order to understand those errors, a review of the FECA’s contribution 

disclosure rules prior to the 1979 amendments and the impact of the 1979 amendments on them 

is helpful. 

A. FECA Prior to the 1979 Amendments 

The 1979 FECA amendments made significant changes to existing campaign finance 

laws. In relevant part, the law changed the reporting obligations for contributions funding 

independent expenditures. Prior to 1980, those making contributions had to file their own 

reports with the FEC. 2 U.S.C. § 434(e)(1) (1976) (“Every person . . . who makes contributions 

. . . in excess of $100 during a calendar year shall file with the Commission . . . a statement. 

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8 

Contribution was defined then as it is now: a thing of value given “for the purpose of 

influencing” an election. Compare 2 U.S.C. § 431(e) (1976) with 52 U.S.C. § 30101(8)(A)(i). 

The contributor would have to report to the FEC the same information that a political 

committee or candidate would report about a contribution they received. 2 U.S.C. § 434(e) 

(1976) (report must contain “the information required of a person who makes contributions in 

excess of $100 to a candidate or political committee and the information required of a candidate 

or political committee receiving such contribution”). Specifically, the report provided “the full 

name and mailing address (occupation and the principal place of business, if any) of each person 

who made one or more contributions . . . within the calendar year in aggregate amount or value 

in excess of $100, together with the amount and date of such contributions.” Id. § 434(b). The 

only exclusion for self-reporting contributions were contributions made to “a political committee 

or candidate.” Id. § 434(e). 

In addition to these self-reports by contributors, those making independent expenditures 

were also required to file reports. Id. Those reports similarly required disclosure of the same 

information political committees and candidates were required to disclose: the identities of 

anyone making over $100 in contributions to the reporting party in a calendar year, along with 

the amount and dates of such contributions. Id. § 434(b). Consequently, where contributions 

were made to someone making independent expenditures, the Commission would receive two 

reports describing the same contribution. 

Although the total amount of independent expenditures reported in the 1979–80 election 

cycle was relatively small—about $16 million, of which non-political committee independent 

Case 1:16-cv-00259-BAH Document 27 Filed 09/11/17 Page 17 of 55
9 

expenditures were but a fraction,1

 compared to $1.4 billion spent in the 2016 cycle2—Congress 

decided to eliminate this double reporting requirement. 1979 FECA History 458. 

B. The 1979 FECA Amendments 

On January 8, 1980, President Carter signed into law Public Law 96-187, enacting a 

number of changes to the FECA. In relevant part, the amendments eliminated the double 

reporting requirement for contributions that went to individuals making independent 

expenditures. See Pub. L. 96-187 § 104. Indeed, the new law eliminated the need for those 

making contributions to report at all. Rather, the law set forth the current regime for reporting: 

contributors would not report, but those making independent expenditures would report two sets 

of contributions they receive. Those making independent expenditures would provide (1) “the 

identification of each person who made a contribution in excess of $200 to the person filing such 

statement which was made for the purpose of furthering an independent expenditure,” id.

§ 104(c)(2)(C) (currently codified at 52 U.S.C. § 30104(C)(2)(C)), and would also provide 

(2) “the information required under subsection (b)(3)(A) for all contributions received by such 

 1 See FEC, Independent Expenditures, 1979–1980, https://www.fec.gov/data/independentexpenditures/?data_type=processed&cycle=1980&is_notice=false&max_date=08%2F14%2F20

17. While the FEC data is not easily filtered to show only independent expenditures by nonpolitical committees, a brief review of the data shows significant independent expenditures by 

political committees. For example, Americans for an Effective Presidency, a registered political 

committee, reported spending about $1.3 million on independent expenditures. The National 

Congressional Club, also a registered political committee, reported about $4.6 million in 

independent expenditures. The largest non-political committee spender appears to have been 

Cecil Haden, who reported about $600,000 in independent expenditures, apparently from his 

own money. It is unknown how much of the money spent on independent expenditures by nonpolitical committees in the 1979-80 election cycle came from contributions from third parties. 

2

 OpenSecrets.org, Total Outside Spending by Election Cycle, Excluding Party Committees, 

https://www.opensecrets.org/outsidespending/cycle_tots.php?cycle=2016&view=A&chart=N#vi

ewpt. 

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person,” i.e., “the identification of each person . . . . who makes a contribution . . . whose 

contribution or contributions have an aggregate amount or value in excess of $200 within the 

calendar year,” id. at § 104 (currently codified at 52 U.S.C. § 30104(b)(3)(A), (c)(1)). 

Although the amendment shifted the burden of reporting, the amendment was intended 

only to “[s]implif[y] reporting without affecting meaningful disclosure.” 1979 FECA History 

103 (Senate Committee on Rules and Administration summary of working draft). The hope was 

that by transferring the responsibility of reporting from the contributor to the recipient, and 

reducing the frequency of other reporting requirements in the legislation, the “amendments 

would . . . alleviate the reporting burdens and reduce by somewhere between one-quarter and 

one-third the files required to be processed and stored by the Commission.” Id. at 451 (S. Rep. 

No. 96-319). Nonetheless, Congress understood that while contributors would no longer report, 

“the person who receives the contribution and subsequently makes the independent expenditure 

would [still] report having received that contribution to the Commission.” Id. at 458 (same). 

C. The FEC’s Rulemaking Process 

In response to the changes to the FECA, the FEC started a rulemaking process to update 

its regulations. AR 1002. Congress gave the FEC only a short window to craft the new 

regulations, however, requiring that the new provisions be transmitted to it by February 29, 1980, 

only two months after the law went into effect. Id.; Pub. L. 96-187 § 303. Accordingly, the 

OGC proposed shortening the time for comment and including a draft set of regulations with its 

public notice. AR 1003. The Commission agreed to do so on January 10, 1980. AR 1031. 

Notably, however, the FEC’s OGC memoranda to the Commission outlining the changes 

in the law did not mention changes to the reporting requirements for contributions to those 

making independent expenditures. See AR 1002–09, 1025–32, 1035–41, 1048–52. In fact, the 

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record is bereft of any discussion of the changes to the relevant provision of the FECA. 

Nonetheless, on January 23, 1980, the FEC published proposed rules in the Federal 

Register. AR 1056–80 (45 Fed. Reg. 5297, 5546–69). With respect to the FECA’s reporting of 

contributions to those making independent expenditures, the agency proposed changes to 11 

C.F.R. § 109.2, then the relevant section of the regulations. AR 1075. Mirroring the language of 

the new § 434(c)(2)(C), the regulations proposed that those making independent expenditures 

would report “the identification of each person who made a contribution in excess of $200 to the 

person filing the statement which was made for the purpose of furthering an independent 

expenditure.” Id. (emphasis added). Notably absent, however, was any provision reflecting 

subsection (c)(1)’s requirement that the report also disclose the information under subsection 

(b)(3)(A) for “all” contributions, 2 U.S.C. § 434(c)(1) (1982), specifically the identities of all 

contributions within the year, id. § 434(b)(3)(A). In fact, the record contains no indication that 

the FEC was even aware of that provision. 

The FEC received a number of comments in response to its proposed rulemaking. AR 

1213–61. None of the comments related to the proposed § 109.2, however. The sole comment 

to even address independent expenditure reporting related to a proposed § 109.5 which, 

apparently inadvertently, was carried over from the old rules requiring contributors to self-report. 

AR 1228; see also AR 1075 (publishing proposed § 109.5 requiring self-reporting of 

“contribution[s] for the purpose of expressly advocating the election or defeat of a clearly 

identified candidate”). The commenter noted that the FECA amendments “no longer require[d] 

the contributor to report separately from those making the independent expenditures,” AR 1228, 

and recommended “striking [§] 109.5 entirely from the proposed regulations.” Id. The 

commenter, however, did not address § 109.2. 

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Shortly after receiving these comments, the FEC circulated a new draft of the regulations 

to the Commission. AR 1262–1335. In line with the comment, the draft deleted the requirement 

that contributors report their own contributions. See AR 1331. The draft also included a 

reworked version of § 109.2, however. AR 1330–31. 

Relevant here, the reworked version contained a small but significant change in the new 

draft: one key difference reflected in the substitution of one word for two others. With respect to 

reporting contributions, the language had mysteriously changed from the previous draft—that all 

contributions made “for the purpose of furthering an independent expenditure” be disclosed, AR 

1075, reflecting the language in the FECA—to a new version that required only the identity of 

each person whose contribution was “made for the purpose of furthering the reported

independent expenditure.” AR 1330 (emphasis added); accord AR 1444. There was no 

explanation given for the change. It was not apparently brought to the Commission’s attention. 

No comment suggested or requested that change, and there is no indication the FEC was aware 

that it had altered the disclosure requirement from the language in 2 U.S.C. § 434(c)(2)(C). 

The Commission debated the new regulations on February 21, 1980. AR 1479, 1486–94. 

There was no apparent discussion related to the proposed § 109.2. The record is devoid of any 

evidence that the Commission considered or was even aware in the divergence of language 

between the proposed rule and the statutory text. Nor does the record contain any indication that 

the Commission considered or was even aware of the fact that the FECA required disclosure of a 

second set of contributions, a requirement totally absent from the proposed rules. The proposed 

rules were approved on that same day. AR 1494. 

On March 7, 1980, the FEC published an explanation and justification for the new rules. 

AR 1496–1542 (45 Fed Reg. 14831, 15080–126). The entire explanation given for the new 

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§ 109.2 was: 

This section has been amended to incorporate the changes set forth 

at 2 USC 434(c)(1) and (2) regarding reporting requirements for 

persons, other than a political committee, who make independent 

expenditures. 

AR 1503. The paragraph did not recognize, never mind attempt to explain or justify, the change 

in language from 2 U.S.C. § 434(c)(2)(C)’s requirement to report contributions made for the 

purpose of furthering “an” independent expenditure to § 109.2’s requirement to report only those 

contributions made for the purpose of furthering “the reported” independent expenditure. Nor 

did the paragraph recognize that 2 U.S.C. § 434(c)(1) required reporting of “all contributions” 

made within the year or attempt to explain or justify why the regulation did not reflect that 

requirement. The explanation further failed recognize that the FECA amendments were intended 

to not “affect[] meaningful disclosure” from the prior law, 1979 FECA History 103, which had 

required all contributions to be reported. 

 On April 1, 1980, the new regulations went into effect. AR 1553. On January 3, 2003, 

the FEC reorganized its regulations in response to the Bipartisan Campaign Reform Act of 2002 

(“BCRA”), moving the old 11 C.F.R. § 109.2 to 11 C.F.R. § 109.10, without changing the 

relevant language. See FEC, Coordinated and Independent Expenditures, 68 Fed. Reg. 421-01, 

432 (Jan. 3, 2003) (noting “[t]he Commission is reorganizing 11 C.F.R. part 109”); FEC, 

Coordinated and Independent Expenditures, 67 Fed. Reg. 60042-01, 60046 (Sept. 24, 2002) 

(stating “[p]aragraph (a) of pre-BCRA 11 CFR 109.2 would be moved to proposed paragraphs 

(b) and (c) of section 109.10”). 

D. Impact of the Rule 

As noted above, the total amounts of money spent on independent expenditures in the 

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election cycle before the 1980 election was relatively small—about $16 million in total.3

 The 

amounts attributable to non-political committee independent expenditures was a small fraction of 

that. Accordingly, the impact of the new FEC regulation was very small, at least initially. 

Prior to Citizens United v. FEC, 558 U.S. 310 (2010), corporations and unions could not 

spend any money from their general treasuries on independent expenditures. See 2 U.S.C. 

§ 441b (2010); see also FEC, Independent Expenditures and Electioneering Communications by 

Corporations and Labor Organizations, 79 Fed. Reg. 62797-02, 62799 (Oct. 21, 2014). Nonpolitical committee independent expenditures therefore were made by individuals or small nonprofit ideological organizations. See MCFL, 479 U.S. at 263–64; 79 Fed. Reg. at 62810. With 

the source of these independent expenditures constrained to individuals or certain nonprofits, 

total reported independent expenditures continued to be relatively modest. Even including 

political committee funded independent expenditures, the amounts spent on independent 

expenditures in an election cycle amounted to only $64 million in 2006.4 That changed, 

however, with a pair of decisions that opened the doors for corporate and union politicking: first, 

FEC v. Wisc. Right to Life, 551 U.S. 449 (2007), which allowed for corporate and union funded 

electioneering communications, and then Citizens United in 2010, which allowed for corporate 

and union funded independent expenditures. In the first presidential election cycle following 

Citizens United, independent expenditures reached $1 billion. OpenSecrets.org, Total Outside 

Spending. They exceeded $1.4 billion in 2016. Id. 

While those numbers include independent expenditures by political committees, the 

ability of non-political committee corporations and unions to spend on independent expenditures 

 3 See supra note 1. 

4 See OpenSecrets.org, Total Outside Spending, supra note 2. 

Case 1:16-cv-00259-BAH Document 27 Filed 09/11/17 Page 23 of 55
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after Citizens United allowed such groups to spend increasing amounts on elections, all without 

reporting their contributors. Before 2008, when only small-non profit corporations could engage 

in politicking, outside spending without disclosure of the source of the funds used was relatively 

nonexistent.5

 In the 2008 election cycle, however, after the Court allowed corporate and union 

funded electioneering communications, undisclosed political spending jumped to $102.4 million 

from $5.1 million the election cycle before.6

 In the 2010 cycle, when Citizens United allowed 

these dark money groups to spend money on independent expenditures, that total jumped again 

to $138.7 million. Id. And in the 2012 cycle, the first presidential election cycle in which dark 

money groups could spend freely during the entire two-year period, undisclosed election 

spending rocketed to $311.3 million. Id. 

With the explosion in spending by groups that, as non-political committees, did not have 

to routinely disclose their donors, the need for contributor disclosure contained in the one-time 

reports for independent expenditures has become paramount. Unfortunately, the total 

inadequacy of the FEC regulation about independent expenditures has also been exposed. 

For example, in the 2010 elections, some thirty-one dark money section 501(c) 

organizations made independent expenditures, yet none disclosed even a single donor. See 

Petition for Rulemaking to Revise and Amend Regulations Relating to Disclosure of 

Independent Expenditures ¶ 10 (Apr. 21, 2010), http://sers.fec.gov/fosers/showpdf.htm?docid= 

61143 (assertions based on data from OpenSecrets.org, in turn based on reported FEC data). 

Those organizations include seven groups which collectively spent a total of about $46.7 million, 

 5

 OpenSecrets.org, Outside Spending by Nondisclosing Groups, Cycle Totals, Excluding Party 

Committees, https://www.opensecrets.org/outsidespending/disclosure.php. 6 See id. These totals include both sums spent on electioneering communications and 

independent expenditures. 

Case 1:16-cv-00259-BAH Document 27 Filed 09/11/17 Page 24 of 55
16 

yet reported not a single dollar in contributions or any of their donors. Id. 

Nor was 2010 an anomaly. A review of FEC data shows the same lack of reporting when 

one looks to the top seven organizations from each of the subsequent two-year election cycles. 

In those cycles, the top seven spenders collectively spent about $205 million, $110 million, and 

$126 million during each of the 2012, 2014, and 2016 election cycles respectively, but they did 

not identify a single contributor or report a single dollar in outside contributions.7

 An exhaustive 

review of those spending less, but by no means small amounts, on independent expenditures 

would likely reveal few additional contributions.8 For example, of the about $7 million in 

independent expenditures by political nonprofits in 2017–18 cycle so far, only a single $500 

contribution has been disclosed.9 

 7

 Data is available on the FEC website at http://classic.fec.gov/fecviewer/ 

CandidateCommitteeDetail.do and can be accessed by searching the respective groups and 

choosing their “independent expenditure” reports. The organizations in question and the years in 

which they were in the top seven spenders on independent expenditures were Crossroads GPS 

(2012, 2014), Americans for Prosperity (2012, 2016), U.S. Chamber of Commerce (2012, 2014, 

2016), American Future Fund (2012, 2016), Americans for Job Security (2012), Americans for 

Tax Reform (2012), American Action Network (2012, 2014, 2016), NRA Institute for 

Legislative Action (2014, 2016), Patriot Majority USA (2014), League of Conservation Voters 

(2014), Kentucky Opportunity Coalition (2014), 45 Committee (2016), and Majority Forward 

(2016). All but one of these organizations reported “$0” in contributions for their independent 

expenditures. The sole exception was Americans for Tax Reform, which reported $15,348,283 

in contributions in 2012 from “Americans for Tax Reform (General Treasury Funds).” See FEC 

Form 5, Schedule 5-A, Americans for Tax Reform (Jan. 20, 2013), http://docquery.fec.gov/cgibin/fecimg/?13940054021. Cleary, a transfer from the organization’s general treasury fund is 

not the sort of transaction that the reporting obligation was intended to disclose. 

8 See, e.g., League of Conservation Voters (reporting $10,828,055 in independent expenditures in 

2012 and $0 in contributions), Ending Spending (reporting $4,023,835 in independent 

expenditures in 2014 and $0 in contributions), Environmental Defense Action Fund (reporting 

$4,285,828 in independent expenditures in 2016 and $0 in contributions). 

9 See OpenSecrets.org, Political Nonprofits, Top Election Spenders, 

https://www.opensecrets.org/outsidespending/nonprof_elec.php?cycle=2018. FEC data is 

available at http://classic.fec.gov/fecviewer/CandidateCommitteeDetail.do and by searching the 

reporting party’s name. The only significant difference in reporting data is for 45 Committee, 

Case 1:16-cv-00259-BAH Document 27 Filed 09/11/17 Page 25 of 55
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One of the largest abusers of the FEC’s regulation after Citizens United was Crossroads 

GPS, the respondent below and the intervener-defendant here. In 2012, the group reported 

spending $70,968,864 on independent expenditures, but reported $0 in contributions, meaning 

that it disclosed none of its contributors.10 In 2014, the group reported spending $26,015,171 in 

independent expenditures, but again reported $0 in contributions.11 The lack of contributor 

reporting caught the FEC’s eye, which sent requests for Crossroads GPS to complete its 

reporting. See, e.g., AR 44. Crossroads GPS responded by stating that its failure to report 

contributors was no mistake, citing the language of 11 C.F.R. § 109.10(e)(1)(vi). See AR 47–48 

(“No contributions accepted by Crossroads [GPS] were solicited or received ‘for the purposes of 

furthering the reported independent expenditure’. . . . The omission of contributor information 

on future reports should not be assumed to be an oversight.”). 

III. The Administrative Proceedings Below 

The proceedings below began when CREW filed a complaint with the FEC on November 

 

which OpenSecrets reports as having spent $743,704 on independent expenditures, but FEC 

reports only show $371,852. See FEC Form 5, July Quarterly Report, 45 Committee (July 30, 

2017), http://docquery.fec.gov/pdf/537/201707309069855537/201707309069855537.pdf. The 

only reported contribution is a $500 contribution to Planned Parenthood Action Fund from a 

PAC subject to its own disclosure obligations. FEC Form 5, Schedule 5-A, July Quarterly 

Report, Planned Parenthood Action Fund (July 14, 2017) http://docquery.fec.gov/cgibin/fecimg/?201707149066633944. 10 See Compl. Ex. A, FEC Form 5, Year-End Report, Crossroads GPS (Jan. 31, 2012), 

http://docquery.fec.gov/cgi-bin/fecimg?_13940087782+0 (covering Oct. 1, 2012 to Dec. 31, 

2012); Compl. Ex. B, FEC Form 5, Oct. Quarterly Report, Crossroads GPS (Oct. 1, 2012),

http://docquery.fec.gov/cgi-bin/fecimg?_12954433250+0 (covering July 1, 2012 to Sept. 30, 

2012); see also AR 131. 

11 See Am. FEC Form 5, Year-End Report, Crossroads GPS (Jan. 26, 2015),

http://docquery.fec.gov/cgi-bin/fecimg?_15950084003+0 (covering Oct. 1, 2014 to Dec. 31, 

2014); FEC Form 5, Oct. Quarterly Report, Crossroads GPS (Oct. 15, 2014), 

http://docquery.fec.gov/pdf/987/14978122987/14978122987.pdf (covering July 1, 2014 to Sept. 

30, 2014). 

Case 1:16-cv-00259-BAH Document 27 Filed 09/11/17 Page 26 of 55
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15, 2012 alleging that Crossroads GPS and its agents failed to reports contributions for 

independent expenditures, as required by law. AR 1–17. 

A. CREW’s Substantiated Allegations 

In its administrative complaint, CREW alleged, based on reporting by an individual 

present, that on August 30, 2012, Crossroads GPS held a fundraiser at the Tampa Club in Tampa, 

Florida. AR 103 (citing Sheelah Kolhatkar, Exclusive: Inside Karl Rove’s Billionaire 

Fundraiser, Bloomberg Businessweek, Aug. 31, 2012); see also AR 122–25. The fundraiser was 

held in conjunction with American Crossroads, an independent expenditure-only political 

committee associated with Crossroads GPS. See AR 94, 96, 103, 166; Compl. ¶ 40; Crossroads 

GPS Answer (“CGPS An.”) ¶ 40 (admission by failure to respond); see also FED. R. CIV. P. 

8(c)(6) (failure to deny allegation is admission). Separate forms were handed out to the 

attendees at the fundraiser for making donations to either Crossroads GPS or American 

Crossroads, with instructions to wire money to each organization. AR 103; Compl. ¶ 40; CGPS 

An. ¶ 40. Approximately 70 high-earning and powerful donors attended. AR 103; Compl. ¶ 41, 

CGPS An. ¶ 41. 

During the fundraiser, Karl Rove, the individual who helped found Crossroads GPS and 

helped with fundraising, AR 103; Compl. ¶ 37; CGPS An. ¶¶ 35–39, briefed attendees on fifteen 

active Senate races, AR 103; Compl. ¶42, CGPS An. ¶ 42. One of the races Mr. Rove analyzed 

was the Ohio Senate race between Senator Sherrod Brown (D-OH) and his Republican 

challenger, Ohio Treasurer Josh Mandel. AR 94, 96, 103; Compl. ¶ 42, CGPS An. ¶ 42. 

Regarding that race, Mr. Rove recounted a call he received from an unnamed out-of-state 

donor. AR 94, 96, 103–04; Compl. ¶ 43; CGPS An. ¶ 43. According to Mr. Rove: 

[The donor] told him, “I really like Josh Mandel.” The donor, Rove 

Case 1:16-cv-00259-BAH Document 27 Filed 09/11/17 Page 27 of 55
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said, had asked him what his budget was in the state; Rove told 

him $6 million. “I’ll give ya $3 million, matching challenge,” 

Rove said the donor told him. Bob Castellini, owner of the 

Cincinnati Reds, is helping raise the other $3 million for that one. 

AR 94, 96, 103–04, 174; Compl. ¶ 43; CGPS An. ¶ 43. 

 Crossroads GPS would eventually report spending $6,363,711 in independent 

expenditures in 2012 opposing Senator Brown. AR 104, 170; Compl. ¶ 44, Ex. A; CGPS An. 

¶ 44. The ten reports Crossroads GPS filed for these independent expenditures did not disclose 

the identity of the donor, who according to Mr. Rove, pledged $3 million in contributions for the 

Ohio Senate race, nor the names of any other donor who contributed “matching funds.” AR 104, 

159; Compl. ¶ 45, Exs. A, B; CGPS An. ¶ 45. American Crossroads, for its part, did not report 

spending any money on the Ohio race. AR 104; Compl. ¶ 46; CGPS An. ¶46. 

During the Tampa fundraiser, Crossroads GPS also showed fourteen television ads to the 

attendees as “examples” of ads the attendees’ contributions would be used to fund. AR 77–78, 

104, 174; Compl. ¶ 47; CGPS An. ¶ 47. The ads targeted Democratic Senate candidates in 

Virginia, Ohio, Montana, Florida, Massachusetts, and Nevada. AR 77–78, 174; Compl. ¶ 47. 

Eleven of the advertisements were produced by Crossroads GPS. Compl. ¶ 47; CGPS An. ¶ 47. 

Among these “example” ads was an ad attacking Senator Brown for voting with Obama 

“95 percent of the time,” for “cut[ting] . . . Medicare spending,” and for “ad[ding] a new tax on 

Ohio manufacturers.” AR 77–78; Compl. ¶ 48, Ex. C at 9; CGPS An. ¶ 48; Crossroads GPS, 

“Cheap” OH (July 3, 2012), https://www.youtube.com/watch?v=4crbHaIdJE4. Another ad 

attacked Nevada Representative Shelley Berkley (D-Nev.) in her run for the Nevada Senate seat, 

citing CREW’s report finding her to be “amongst Washington’s most corrupt,” accusing her of 

“enrich[ing] . . . herself,” calling her own ads “untrue,” and arguing that “Shelley Berkley is 

Case 1:16-cv-00259-BAH Document 27 Filed 09/11/17 Page 28 of 55
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everything that’s wrong with Washington.” AR 78; Compl. ¶ 48, Ex. C at 15; CGPS An. ¶ 48; 

see also Crossroads GPS, “Investigation” NV (Aug. 3, 2012), https://www.youtube.com/watch?v

=6bk4e0CU-H0. Another ad attacked Virginia Senator Tim Kaine (D-Va.) for supporting a cut 

to “defense spending” that could “cost Virginia 200,000 jobs.” AR 77; Compl. ¶ 48, Ex. C at 

13–14; CGPS An. ¶ 48; see also Crossroads GPS, “Cost” VA (Aug. 15, 2012), https://www. 

youtube.com/watch?v=3sLwpr9DrNk.t. 

The attendees were then solicited for contributions, and Crossroads GPS officials stressed 

that additional sums were needed because advertising rates were increasing, making it more 

costly for Crossroads GPS to broadcast advertisements like those the attendees had just watched. 

AR 105; Compl. ¶ 49; CGPS An. ¶ 49. 

While the fundraisers apparently used the name “American Crossroads” in their 

fundraising pitches, they evidently used it to mean both American Crossroads and Crossroads 

GPS. AR 105–106; Compl. ¶ 51. One fundraiser told the attendees that “American Crossroads” 

was two-thirds of the way to reaching its $300 million fundraising goal, but the spokesman for 

both Crossroads GPS and American Crossroads acknowledged the $300 million goal was the 

combined budgets for both groups. AR 105; Compl. ¶ 51. In addition, eleven of the fourteen 

ads shown to the attendees before they were solicited were produced by Crossroads GPS, and it 

subsequently made independent expenditures in five of the six races for which ads were shown. 

AR 77–78, 105–06; Compl. ¶ 51, Ex. A at 77, 80, 83, 84, 86. In the sixth race, in Florida, 

Crossroads GPS broadcast an “issue ad” just before the fundraiser that was not reported to the 

FEC. See AR 105–06; Compl. ¶ 51, Ex. D. American Crossroads, on the other hand, ran 

independent expenditures in only two of the six identified races, Montana and Florida. Compl. 

¶ 62; CGPS An. ¶ 62. 

Case 1:16-cv-00259-BAH Document 27 Filed 09/11/17 Page 29 of 55
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Many of those independent expenditures were broadcast ads that mirrored the “example” 

ads shown to the contributors at the August 30 fundraiser. For example, like one of the ads 

shown to the contributors, Crossroads GPS’s ads attacked Senator Brown for voting with 

Obama “95 percent of the time,” creating a “new tax” on “Ohio manufacturers,” and “cut[ting]” 

“Medicare spending.”12 Further, like an ad shown to the contributors, Crossroads GPS’s ads 

attacked Rep. Berkley as having been named (by CREW) as amongst the “most corrupt 

politicians” in Washington, accusing her of “enriching herself,” calling her own ads “false,” and 

asserting “Shelley Berkley [is] everything that’s wrong with Washington.”13 Crossroads GPS 

also ran an ad attacking Senator Kaine that, like the ad shown to the contributors at the August 

30 meeting, accused the senator of supporting a cut to “defense” that would cost “200,000 

Virginia jobs.”14

In addition to the ten reports disclosing independent expenditures in the Ohio race, 

Crossroads GPS filed more than 32 reports disclosing independent expenditures for broadcast 

ads in the Virginia, Montana, and Nevada Senate races subsequent to the fundraiser, and reported 

spending upwards of $17 million on those independent expenditures. AR 106; Compl. ¶ 53, Exs. 

 12 Compl. ¶ 52, Ex. A at 55–56, 79, Ex. B at 8, 21, Ex. C at 4, 5–6, Ex. E, Ex. F; CGPS An. ¶ 52; 

see also Crossroads GPS, “Football” OH (Sept. 11, 2012), https://www.youtube.com/watch?v 

=RsvtT5rI7ZM; Crossroads GPS, “When” OH (Sept. 26, 2012), https://www.youtube.com/ 

watch?v=_lRfaaqpe2U; Crossroads GPS, “Dragging” OH (Oct. 23, 2012), https://www.youtube 

.com/watch?v=_rFLQOT8oj0; Crossroads GPS, “Down” OH (Oct. 30, 2012), 

https://www.youtube.com/watch?v=19W9JO7wD-4. 13 Compl. ¶ 52, Ex. A at 55, Ex. B. at 6, 13, Ex. C at 10; CGPS An. ¶ 52; see also Crossroads 

GPS, “Laughable” NV (Sept. 11, 2012), https://www.youtube.com/watch?v=vCjBIw3V4Vw; 

Crossroads GPS, “Shameful” NV (Sept. 18, 2012), https://www.youtube.com/watch?v=y4jf3y 

U0WY4; Crossroads GPS, “Favorite” NV (Oct. 23, 2012), https://www.youtube.com/watch?v= 

CTCN6cJ93E8. 14 Compl. ¶ 52, Ex. B at 7, Ex. C at 10–11; CGPS An. ¶ 52; see also Crossroads GPS, 

“Questionable” VA (Sept. 11, 2012), https://www.youtube.com/watch?v=Am9Mq4DpQ-Q. 

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22 

A, B; CGPS An. ¶ 53. The reports failed to disclose the names of any of the donors who 

contributed to Crossroads GPS, including those who contributed for the purpose of furthering 

Crossroads GPS’s independent expenditures, and even those who specifically contributed for the 

purpose of furthering the reported independent expenditures. See AR 106; Compl. ¶53, Ex. A at 

1, Ex. B at 1; CGPS An. ¶ 53. 

Based on these allegations, CREW alleged Crossroads GPS and certain of its agents 

violated 2 U.S.C. § 434 (now 52 U.S.C. § 30104) and 11 C.F.R. § 109.10(b)–(e). AR 108–15. 

B. The FEC’s Proceedings 

The FEC denoted CREW’s complaint MUR 6696. AR 1, 55. On November 28, 2012, 

the FEC forwarded CREW’s complaint to the respondents, including intervenor-defendant 

Crossroads GPS. AR 57–66. On January 17, 2013, counsel for Crossroads GPS and its agents 

submitted a response characterizing CREW’s complaint as a “stunt,” and took issue with some of 

the reporting, but largely conceded the factual allegations CREW made. AR 73–93. 

The response included a signed affidavit of Mr. Rove, admitting the allegations about his 

conversation with the donor regarding the Ohio Senate race were “substantially accurate.” AR 

94–97. Critically, Mr. Rove conceded that “[i]t was his understanding . . . that the donor 

intended the funds to be used in some manner that would aid the election of Josh Mandel.” Id.

Crossroads GPS further admitted that the donor had indeed contributed to Crossroads GPS an 

amount exceeding $3 million, and that the matching challenge generated an additional $1.3 

million in contributions for Crossroads GPS’s electoral work in Ohio. Id. 

With respect to the Tampa fundraiser, the response contended that the fundraiser was 

hosted by American Crossroads, not Crossroad GPS. AR 82, 96. Nonetheless, the response did 

not dispute facts that render their assertion that no funds were raised for Crossroads GPS 

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23 

incredulous: (1) that at the fundraiser, Rove recounted a conversation with a donor about 

“Crossroads GPS efforts in Ohio” and the donor’s offer to “donate funds toward Crossroads 

GPS’s budget in the State of Ohio,” AR 96; (2) that Crossroads GPS ran independent 

expenditures in Ohio but American Crossroads did not report spending any money in that 

election, AR 104; (3) the vast majority of the “example” ads shown were from Crossroads GPS, 

not American Crossroads, AR 77–78; (4) that forms handed to attendees provided instructions on 

how to donate to Crossroads GPS, see AR 103; and (5) that after the fundraiser, Crossroads GPS 

ran ads in each of the six races for which examples were shown (with five of the six constituting 

independent expenditures), whereas American Crossroads did not, AR 105–06; Compl. ¶¶ 51, 

62, Ex. A at 77, 80, 83, 84, 86; CGPS An. ¶ 62. Each of these facts contradicts Crossroads 

GPS’s claim that the fundraiser was for American Crossroads’ benefit alone. Indeed, the 

respondents did not even dispute that Crossroads GPS raised money at the fundraiser. 

On April 24, 2013, CREW filed an amended complaint with the FEC, substituting 

Nicholas Mezlak as a named complainant for Jessica Markley. AR 98–117. In response, 

respondents reiterated their previous reply. AR 162–63. 

On March 7, 2014, the FEC’s OGC issued its First General Counsel’s Report on CREW’s 

complaint (the “Report”). AR 164–177. The Report found that the contributor who pledged the 

$3 million of which Mr. Rove spoke at the August 30, 2012 fundraiser “proposed to make a 

contribution to Crossroads [GPS] for it to use to support the election of Josh Mandel.” AR 174. 

Nonetheless, the Report concluded that the “donor’s general purpose to support an organization 

in its efforts to further the election of a particular federal candidate does not itself indicate that 

the donor’s purpose was to further ‘the reported independent expenditure,’” and therefore it did 

not establish the “express link between the receipt and the independent expenditure” required by 

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11 C.F.R. § 109.10(e)(1)(vi). AR 173–74. The Report further concluded that no reasonable 

inference could be drawn to support even a reason to believe that the matching contributors gave 

for the purpose of furthering any of Crossroads GPS’s ten reported independent expenditures in 

Ohio. AR 174. And the Report concluded that there was “no basis” to conclude that Crossroads 

GPS received contributions from the attendees at the August 30, 2012 meeting for the purpose of 

furthering any of the independent expenditures Crossroads GPS reported in Virginia, Montana, 

and Nevada. AR 175. Accordingly, the OGC recommended finding no reason to believe 

Crossroads GPS violated 11 C.F.R. § 109.10(e)(1)(vi). AR 176. 

The Report acknowledged, however, that the disclosure requirements imposed by 11 

C.F.R. § 109.10(e)(1)(vi) conflicted with statutory requirements imposed by the FECA, which 

“may reasonably be construed to require disclosure of the identity of certain contributors 

regardless of whether the contributor made a contribution to further a specific independent 

expenditure.” AR 173. The OGC recognized that the statutory provision in question, 2 U.S.C. 

§ 434(c)(2)(C) (now 52 U.S.C. § 30104(c)(2)(C)), required “an arguably more expansive 

approach” than embodied in 11 C.F.R. § 109.10(e)(1)(vi) because the statute requires reporting 

any contribution given for the purpose of furthering “an” independent expenditure, but the 

regulation requires reporting only contributions given for the purpose of furthering “the 

reported” independent expenditure. AR 175. Nonetheless, the OGC concluded that the 

regulation constituted “the Commission’s controlling interpretation of the statutory provision.” 

Id. Accordingly, the OGC found its conclusion that there was no reason to believe Crossroads 

GPS violated 11 C.F.R. § 109.10(e)(1)(vi) foreclosed the claim that Crossroad GPS violated 52 

U.S.C. § 30104(c)(2)(C). Id. 

With regard to the disclosure provisions of 2 U.S.C. § 434(c)(1) (now 52 U.S.C. 

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§ 30104(c)(1)), however, the OGC recognized that the statutory provision “impose[d] additional 

reporting obligations for certain contributions made for the purpose of influencing a federal 

election generally.” AR 175. The OGC recognized that 11 C.F.R. § 109.10 was “silent 

concerning any such additional reporting requirement.” AR 175–76. Accordingly, the OGC did 

not conclude that its recommendations as to 11 C.F.R. § 109.10 resolved the question of whether 

Crossroads GPS violated § 30104(c)(1). AR 176. Indeed, it recognized “that the facts here may 

also give rise to a claim that Crossroads [GPS] allegedly violated [52] U.S.C. § [30104](c)(1).” 

Id. Nonetheless, the OGC recommended that the Commission dismiss such an allegation on the 

basis of prosecutorial discretion because “a Respondent could raise equitable concerns about 

whether a filer has fair notice of the requisite level of disclosure required by law if the 

Commission attempted to impose liability under Section [30104](c)(1).” Id. 

Consequently, the OGC recommended finding no reason to believe Crossroads GPS 

violated 52 U.S.C. § 30104(c)(2)(C) and 11 C.F.R. § 109.10(e)(1)(vi), and recommended 

dismissing the allegation Crossroads GPS violated 52 U.S.C. § 30104(c)(1) on the grounds of a 

supposed lack of fair notice. AR 176. The OGC recommended closing the file on the other 

respondents. Id. 

After the OGC issued its Report, the Commission voted on its recommendations on 

November 17, 2015. AR 193. The Commission deadlocked three-to-three on the question of 

whether to find reason to believe that Crossroads GPS violated 52 U.S.C. § 30104(c)(2)(C) and 

11 C.F.R. § 109.10(e)(1)(vi), and deadlocked on whether to exercise its prosecutorial discretion 

to ignore Crossroads GPS’s violation of 52 U.S.C. § 30104(c)(1). Id. The Commission also 

deadlocked on whether to close the file on Mr. Law, Mr. Rove, Mr. Barbour, and Mr. Crosby. 

Id. Subsequently, on December 17, 2015, as a result of the deadlock, the Commission voted sixCase 1:16-cv-00259-BAH Document 27 Filed 09/11/17 Page 34 of 55
26 

to-zero to close the file on MUR 6696, dismissing Plaintiffs’ complaint. AR 195. 

The three commissioners who voted against finding reason to believe Crossroads GPS 

violated the FECA and the FEC regulation did not issue a Statement of Reasons explaining their 

vote. Commissioners Anne M. Ravel and Ellen L. Weintraub, who both voted to find reason to 

believe Crossroads GPS failed to report contributors as required by law, issued their own 

Statement of Reasons. AR 198–99. 

On February 16, 2016, within sixty days of the date of dismissal, CREW filed this action. 

ARGUMENT 

I. Jurisdiction 

The action arises under the FECA, 52 U.S.C. § 30101 et seq. and the APA, 5 U.S.C. 

§§ 551-706. This Court has jurisdiction pursuant to 28 U.S.C. § 1331 and venue is appropriate 

under 28 U.S.C. § 1391(e). Plaintiffs have standing pursuant to FEC v. Akins, 524 U.S. 11 

(1998), because they have not received information to which they are legally entitled under the 

FECA, id. at 21; Compl. ¶¶ 7–18; see also Mem. Op. 16–17 & n.5, ECF No. 22. 

II. Standard of Review 

This action raises two separate but related questions: (1) whether 11 C.F.R. 

§ 109.10(e)(1)(vi) conflicts with the FECA or is otherwise arbitrary and capricious in violation 

of the APA, 5 U.S.C. § 706, and (2) whether the FEC’s dismissal of CREW’s complaint against 

Crossroads GPS permitted activity “contrary to law” in violation of the FECA, 52 U.S.C. 

§ 30109(a)(8)(C). 

With respect to the first question, a court examines the regulation “under the two-step 

analysis” set forth in Chevron U.S.A., Inc. v. NRDC, 467 U.S. 837 (1984), to determine whether 

the regulation is a valid interpretation of the statute. Shays v. FEC, 414 F.3d 76, 96 (D.C. Cir. 

Case 1:16-cv-00259-BAH Document 27 Filed 09/11/17 Page 35 of 55
27 

2005). Under that analysis, the court asks whether the statute is ambiguous, and if it is, the court 

asks “whether the agency’s interpretation is reasonable.” Id. “At the same time, because the 

regulation[] reflect[s] final agency action under the APA, [the court] ask[s] whether [it is] 

‘arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.’” Id. If 

an agency “fail[s] to present an adequate basis and explanation” for a rule, the rule is arbitrary 

and capricious in violation of the APA. Motor Vehicle Mfrs. Ass’n of U.S. v. State Farm Mut. 

Auto Ins. Co., 463 U.S. 29, 34 (1983). An agency must “articulate a satisfactory explanation for 

its action including a rational connection between the facts found and the choice made.” Id. at 

43. The court looks to the “contemporaneous justification” for the rule and must ignore all 

“post-hoc” explanations. N. Air. Cargo v. U.S. Postal Serv., 674 F.3d 852, 860 (D.C. Cir. 2012); 

accord Burlington Truck Lines, Inc. v. United States, 371 U.S. 156, 168-69 (1962); Williams Gas 

Processing – Gulf Coast Co., L.P. v. FERC, 373 F.3d 1335, 1345 (D.C. Cir. 2004) (“It is 

axiomatic that [a court] may uphold agency orders based only on reasoning that is fairly stated 

by the agency in the order under review . . . ; ‘post hoc rationalizations by agency counsel will 

not suffice.’” (citing SEC v.Chenery Corp., 318 U.S. 80, 88 (1943))). 

 With respect to the second question, whether the FEC’s dismissal permits activity 

“contrary to law,” the court asks whether “(1) the FEC dismissed the complaint as a result of 

impermissible interpretations of the [law], or (2) if the FEC’s dismissal of the complaint, under 

permissible interpretations of the [law], was arbitrary or capricious, or an abuse of discretion.” 

Orloski v. FEC, 795 F.2d 156, 161 (D.C. Cir. 1986). In deciding that question, the court reviews 

the contemporary rationale provided by the commissioners who voted against proceeding with 

the investigation, as their reasoning provides the explanation for the failure to act, even where 

the commissioners preventing enforcement do not represent a majority of the commission and 

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thus do not have the authority to exercise agency power or make statements of law. FEC v. Nat’l 

Republican Senatorial Comm., 966 F.2d 1471, 1476 (D.C. Cir. 1992); Common Cause v. FEC, 

842 F.2d 436, 449 n.32 (D.C. Cir. 1988). Where these controlling commissioners do not provide 

their own statement of reasons but instead adopt the recommendations of the OGC, the court 

reviews the reasoning provided the OGC. FEC v. Democratic Senatorial Campaign Comm., 454 

U.S. 27, 45 n.19 (1981) (reviewing OGC’s report to determine if agency action contrary to law 

where agency followed OGC’s recommendation). 

III. 11 C.F.R. § 109.10(e)(1)(vi) is Unexplained, Inexplicable, and Invalid 

The FEC’s dismissal of CREW’s complaint relied heavily on the fact that 11 C.F.R. 

§ 109.10(e)(1)(vi) only requires those making independent expenditures to report contributions 

given for the purpose of furthering “the reported” independent expenditure, even though 52 

U.S.C. § 30104(c)(2)(C) requires a broader set of contributions to be reported. AR 186. The 

regulation, however, is invalid because it fails both prongs of the applicable analysis: (1) it is 

arbitrary and capricious because it was issued without any explanation, and (2) it fails under 

Chevron because it conflicts with the unambiguous terms of § 30104(c)(2)(C), and it is 

unreasonable because it both frustrates the statute’s purposes to the point of nullifying the law 

and renders the law redundant. 

A. The Regulation Cannot Be Valid Because the FEC Failed to Explain Its 

Narrowing of Disclosure Required by the Statute 

The FEC adopted 11 C.F.R. § 109.10(e)(1)(vi) without explaining—or indeed even 

acknowledging—that the regulation materially altered the reporting obligations for those who 

make independent expenditures, drastically limiting the information that is made available to 

voters. As a result, the regulation is arbitrary and capricious, and cannot be valid. 

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“[W]hen an agency fails to provide a reasoned explanation, or where the record belies the 

agency’s conclusion, the court must undo its action.” Aragon v. Tillerson, 240 F. Supp. 3d 99, 

*6 (D.D.C. 2017) (Howell, J.) (internal quotation marks omitted). “The requirement that agency 

action not be arbitrary or capricious includes a requirement that the agency adequately explain its 

result.” Public Citizen, Inc. v. FAA, 988 F.2d 186, 197 (D.C. Cir. 1993); see also Motor Vehicle 

Mfrs. Ass’n of U.S., 463 U.S. at 34. Failing to do so renders the regulations invalid. Thus, for 

example, in Shays, where “the Commission offered no persuasive justification for the provisions 

challenged,” the D.C. Circuit invalidated the FEC regulations at issue. 414 F.3d at 100–02; see 

also Shays v. FEC, 528 F.3d 914, 921, 932 (D.C. Cir. 2008) (noting after prior judgment, FEC 

engaged in new rulemaking to reissue regulation with additional explanation; reviewing and 

striking reissued regulations that still lacked a persuasive justification); Nat’l Mining Ass’n v. 

U.S. Army Corps of Eng’rs, 145 F.3d 1399, 1409 (D.C. Cir. 1998) (“[W]hen a reviewing court 

determines that agency regulations are unlawful, the ordinary result is that the rules are vacated.” 

(internal quotation marks and citation omitted)); Sierra Club v. Van Antwerp, 719 F. Supp. 2d 

77, 78 (D.D.C. 2010) (finding “set aside means ‘to annul or vacate’” in APA (quoting Black’s 

Law Dictionary (8th ed. 2004)). 

Congress amended the FECA in 1979 to do away with the need for contributors to selfreport, and to instead shift the burden onto those making independent expenditures, “without 

affecting meaningful disclosure.” 1979 FECA History at 103. With respect to one of the two 

categories Congress required those making independent expenditures to report, the law required 

the disclosure of all contributions given “for the purpose of furthering an independent 

expenditure.” 52 U.S.C. § 30104(c)(2)(C) (emphasis added). In fact, the FEC recognized that 

requirement when it first proposed regulations after the amendments, drafting a rule requiring 

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those making independent expenditures to report all contributions given “for the purpose of 

furthering an independent expenditure.” AR 1075 (emphasis added). 

Nonetheless, despite receiving no comments from the public about that proposed 

language, and despite there being no discussion at the FEC about the language, the FEC 

inexplicably changed the language to require only the reporting of contributions given “for the 

purpose of furthering the reported independent expenditure.” AR 1330 (emphasis added). As 

the OGC recognized below, the regulation adopted by the FEC is far narrower than the statute. 

AR 173. Whereas the statute requires “disclosure of certain contributors regardless of whether 

the contributor made a contribution to further a specific independent expenditure,” the regulation 

requires “an express link between the receipt and the independent expenditure.” Id. 

When the FEC finally issued its explanation and justification, it said only that regulation 

“incorporate[ed] the changes” in the legislation, but it did not provide a “cogent explanation”—

nor indeed any explanation or even acknowledgment—of the regulation’s diversion from the 

statute. AR 1503; Shays, 414 F.3d at 100. Indeed, the record is devoid of any evidence showing 

the commissioners were even aware of this change in language or gave it any thoughtful 

consideration. 

The FEC’s total lack of explanation for its departure from the statutory text, and indeed 

the complete lack of any apparent awareness of that divergence, renders the rule irreparably 

arbitrary and capricious. Accordingly, “the court must undo [the FEC’s] action” by declaring the 

rule invalid. Aragon, 240 F. Supp. 3d at *6. 

B. The Regulation Conflicts with the Unambiguous Terms of the FECA 

In addition to the regulation being invalid because it has no explanation, the rule’s 

language cannot be reconciled with the statute under either step of the Chevron analysis. The 

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regulation fails step one of the Chevron analysis because the FECA’s use of the indefinite article 

“an” is unambiguous and leaves no room for the agency to narrow the statute. It also fails 

Chevron’s step-two because the regulation frustrates the FECA’s purposes by essentially 

nullifying disclosure of contributions for independent expenditures under 52 U.S.C. 

§ 30104(c)(2)(C). Finally, the regulation, as interpreted, conflicts with other statutory and 

regulatory reporting requirements. 

1. The Regulation Fails Chevron Step-One 

Subsection (c)(2)(C) unambiguously calls on those creating independent expenditures to 

report contributions they received for the purpose of furthering “an” independent expenditure, 

not merely “the” specific independent expenditure reported. Accordingly, the regulation clearly 

fails under Chevron step-one. Barnhart v. Walton, 535 U.S. 212, 217–218 (2002) (“[I]f the 

statute speaks clearly to the precise question at issue, we must give effect to the unambiguously 

expressed intent of Congress.” (internal quotation marks omitted)); Robinson v. Shell Oil Co., 

519 U.S. 337, 341 (1997) (“The plainness or ambiguity of statutory language is determined by 

reference to the language itself, the specific context in which that language is used, and the 

broader context of the statute as a whole.”); Engine Mfrs. Ass’n v. EPA, 88 F.3d 1075, 1089 

(D.C. Cir. 1996) (“[F]or the EPA to avoid a literal interpretation at Chevron step one, it must 

show either that, as a matter of historical fact, Congress did not mean what it appears to have 

said, or that, as a matter of logic and statutory structure, it almost surely could not have meant 

it.”). 

The use of the indefinite “an” is unambiguous. While a definite article would mean that 

the contribution must be related to a specific independent expenditure, the use of the indefinite 

clearly covers the full category of independent expenditures the reporting party has created or 

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may create. Courts understand that when Congress distinguishes between indefinite and definite 

articles, it does so with purpose. For example, in Mylan Pharmaceuticals, Inc. v. Shalala, a 

court in this district held that a statute’s use of the indefinite “a” was not ambiguous under 

Chevron and did not allow the agency to substitute the indefinite for a definite article. 81 F. 

Supp. 2d 30, 37 (D.D.C. 2000). According to the court, “[t]he use of the indefinite article ‘a’ 

plainly connotes that ‘a court’ may refer to a district court, an appellate court, one of the two, or 

both.” Id. “Simply because Congress chose to employ the indefinite article does not imply that 

‘Congress has explicitly left a gap for the agency to fill.’” Id. (quoting Chevron, 467 U.S. at 

843). Because there is no ambiguity in the statute for the FEC to fill, the FEC could not 

substitute the definite language “the reported” independent expenditure for the statute’s 

indefinite “an” independent expenditure which would disclose significantly more contributions. 

While the FEC may attempt to rely on the D.C. Circuit’s recent decision in Van Hollen v. 

FEC, 811 F.3d 486 (D.C. Cir. 2016), to argue that it has authority to interpret and limit reporting 

obligations, Van Hollen stands for no such thing. In Van Hollen, the D.C. Circuit considered a 

challenge to a new rule by the FEC that proscribed electioneering communications reporting for 

corporations and unions. Id. at 491 (quoting 11 C.F.R. § 104.20(c)(9)). The regulation was 

needed because corporations and unions only recently gained the authority to create 

electioneering communications. Id. at 490–93 (discussing impact of Wisconsin Right to Life, 551 

U.S. at 482). While the statute required those making electioneering communications to report 

all contributions they received unless they were funded by a segregated fund, see id. at 492 

(discussing 52 U.S.C. § 30104(f)(2)(E), (F)), the FEC interpreted the words “contributor” and 

“contributed” in the statute to imply an additional purposive requirement tied to funding 

electioneering communications. Id. at 497–01. The court upheld that interpretation under 

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Chevron, noting the unqualified use of “contributor” and “contribution” in the statute was 

ambiguous. Id. at 495. 

Here, however, there was no unexpected situation created by a court decision that left the 

FEC with a gap filling role. Congress explicitly adopted the rule that addressed the reporting 

requirements for independent expenditures and expressly stated the purpose that would qualify 

(with respect to this provision of the statute): that the contributor give for the purpose of 

furthering an independent expenditure. 52 U.S.C. § 30104(c)(2)(C). 

In sum, the FECA is not ambiguous as to the nature of the contributions to be reported 

under subsection (c)(2)(C): all contributions given for the purpose of furthering an independent 

expenditure, regardless of whether the contribution was given for the purpose of reporting the 

particular independent expenditure reported. Because Congress “has directly spoken to the 

precise question at issue,” Shays, 414 F.3d at 105, the FEC may not alter the law. 

2. The Regulation Fails Chevron Step-Two 

Even if the statute were ambiguous (and it is not), the regulation also fails under 

Chevron’s second step: that the “agency’s interpretation [be] reasonable.” Shays, 528 F.3d at 

919. The FEC’s rule has frustrated the FECA’s purpose by effectively nullifying disclosure of 

contributions for independent expenditures. Further, the proposed rule renders the disclosure 

provision of subsection (c)(2)(C) redundant to other portions of the FECA. 

a. The Rule Frustrates the FECA’s Disclosure Purposes 

First, the FEC’s construction limiting disclosure to those contributions given for the 

“purpose of furthering the reported independent expenditure” is unreasonable because it has 

frustrated the purpose of subsection (c)(2)(C): to ensure voters are informed about contributions 

used to fund independent expenditures. 1979 FECA History 103. Congress and the Supreme 

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Court have recognized disclosure of these contributions serves a vital purpose in our democracy, 

preserving the “free functioning of our national institutions.” Buckley, 424 U.S. at 66–67; 

accord Citizens United, 558 U.S. at 370 (disclosure allows “citizens [to] see whether elected 

officials are ‘in the pocket’ of so-called moneyed interests”); McConnell v. FEC, 540 U.S. 93, 

201 (2003) (disclosure “perform[s] an important function in informing the public about various 

candidates’ supporters”). 

As described above, 11 C.F.R. § 109.10(e)(1)(vi)’s narrow language has effectively 

resulted in no disclosure of contributions used to fund independent expenditures. See supra 

Statement of Facts II.D.15 “In applying Chevron’s second step and the APA, [courts] must reject 

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

implement.” Shays, 528 F.3d at 919. Where a rule allows a regulated party to “evade—almost 

completely” the statutory requirements, the rule is invalid. Id. at 925. Nor can it be said that the 

FEC is merely balancing Congress’s purpose in disclosure against “conflicting privacy interests 

that hang in the balance,” Van Hollen, 811 F.3d at 494: a rule which eviscerates the only 

purpose for the statutory text’s existence hardly strikes a reasonable balance. 

b. The Rule Renders Subsection (c)(2)(C) Contributor Disclosure Redundant 

Second, the rule is unreasonable as interpreted because it makes subsection (c)(2)(C) 

 15 The Court may consider this material, even where outside the record, because this material is 

relevant to the proper legal interpretation of the FECA, FED. R. EVID. 201 notes (“In determining 

the content or applicability of a rule of domestic law, the judge is unrestricted in his investigation 

and conclusion.”), the material shows whether the regulation “frustrates Congress’s goal,” Shays, 

528 F.3d at 925 (looking to evidence offered at oral argument to determine if regulation 

frustrated BCRA); and the material shows “whether the agency considered all the relevant 

factors or fully explicated its course of conduct or grounds of decision,” Nat’l Treasury Emps. 

Union v. Hove, 840 F. Supp. 165, 168 (D.D.C. 1994), aff’d, 53 F.3d 1289 (D.C. Cir. 1995); 

accord Oceana, Inc. v. Locke, 674 F. Supp. 2d 39, 45 (D.D.C. 2009) (court may take notice of 

extra-record evidence to see if agency “failed to examine all relevant factors”). 

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redundant to other disclosure provisions of the FECA and FEC regulations. Specifically, the 

section’s disclosure would be redundant to the FECA’s disclosure obligations for those making 

independent expenditures. See 52 U.S.C. § 30104(c)(1); 11 C.F.R. § 109.10(b). A “cardinal rule 

of statutory interpretation [is] that no provision should be construed to be entirely redundant.” 

Kungys v. United States, 485 U.S. 759, 778 (1988); Shays v. FEC, 337 F. Supp. 2d 28, 77 

(D.D.C. 2004) (finding FEC’s interpretation failed Chevron step-two when it rendered a term 

“superfluous” to others). Yet the FEC’s construction of 52 U.S.C. § 30104(c)(2)(C) via 11 

C.F.R. § 109.10(e)(1)(vi) would require such a close connection between the contributor and the 

independent expenditure that the contributor would in fact be the maker of the independent 

expenditure itself. 

In interpreting § 109.10(e)(1)(vi) below, the OGC said that an “express link” was 

required between the contributor and the reported independent expenditure. AR 173. Although 

the OGC did not elaborate on this direct link, it appears from its discussion that, to qualify as a 

contribution that must be disclosed under its interpretation: (1) the contributor must have more 

than a “general purpose to support an organization in its efforts to further the election of a 

particular federal candidate,” AR 174; (2) the contributor’s funds cannot be directed through 

some intermediary “general treasury fund[]” on the way to paying for the ad but must, 

presumably, go directly from the contributor to pay for the ad, see AR 173 (discussing case 

finding that funds were not contributed for the purpose of furthering the reported independent 

expenditure where they were routed through a “general treasury”); and (3) it is not enough for 

the contributor to see an “example” ad and to choose to contribute funds to create other similar 

but not-yet-created ads. AR 78, 174–75. Although the OGC did not expressly adopt the 

interpretation proffered by Crossroads GPS, the OGC apparently agrees that a contributor “must 

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36 

know the advertisement he or she is funding.” AR 172. In other words, to qualify as a 

contribution that furthers the reported independent expenditure, a contributor must either choose 

to fund a single specific ad, shown in advance to the contributor in its final form, or must retain 

so much editorial control over the production that the donor knows the exact communication that 

the contribution is going to fund. 

A person with such control of the use of his funds, however, would not be a contributor 

to the group airing the ad, but would rather be “mak[ing]” the independent expenditure and thus 

have to report it himself. 11 C.F.R. § 109.10(b). It is clear from FEC regulations and precedent 

that the person who “makes” a particular independent expenditure is the person or persons who 

pays for it in its final form. FEC, AO 2008-10 (Votervoter.com) (Oct. 24, 2008) (finding 

company engaged in “bona fide commercial activity” that causes independent expenditure to air 

nonetheless does not “mak[e]” the ad because it does not pay for it). That is why the FECA and 

FEC regulations for disclaimers on ads, designed to let viewers know who makes the ad, require 

the ad to identify who “paid for the communication.” 52 U.S.C. § 30120(a)(3); 11 C.F.R. 

§ 110.11(b). It is irrelevant that the ad may pass through the hands of other persons afterwards: 

an ad will often pass through a broker and a television station before airing, but those persons 

would merely be conduits carrying out the decision made by the person making the ad. See AO 

2008-10. If a person decides to fund the production and airing of a specific independent 

expenditure, that person “makes” the independent expenditure. That person must then disclose 

their identity by filing a report with the FEC describing the independent expenditure; there is no 

need for her to be identified as a contributor to one of the conduit parties. 

Conversely, an individual who contributes for the purpose of furthering the reported 

independent expenditure would not be a “contributor” as that term is defined by FEC regulations. 

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That is because a contribution is “made when the contributor relinquishes control over the 

contribution.” 11 C.F.R. § 110.1(b)(6). If a person retained ultimate control over the end use of 

her money by identifying the single specific expenditure it will be used to fund, she has not made 

a contribution because she has not “relinquishe[d] control” of the funds. Id. Rather, that person 

made the expenditure itself. 

A similar principle is at work in the FECA and FEC regulations for reporting 

contributions to candidate committees and political parties. Both the statute and FEC regulations 

require tracking and reporting the party who “makes” a contribution to one of these groups. 52 

U.S.C. § 30104(b)(3)(A), (B); 11 C.F.R. § 104.3; accord 11 C.F.R. § 110.1(a), (b)(1) (“making 

contributions” and “make contributions”); 11 C.F.R. § 109.10(e)(1)(vi) (requiring reporting of 

one who “made a contribution”). But the law does not merely look to the last person in 

possession of the money before it goes into the pockets of the candidate or party; rather, it looks 

to who directed the funds to the specific end. If person A gives money to person B with 

instructions that the money is go to fund the specific and identifiable candidate C, it is person A 

who “makes” the contribution, not person B. The person through which the funds pass in that 

situation is a mere conduit; they are not the “true source” of the contributions. FEC v. Hsia, 176 

F.3d 517, 524 (D.C. Cir. 1999) (finding violation of FECA where report identified as the 

contributor and not the true source who directed where the funds would go). Thus, if a person 

gives money to a third party but “know[s] the [candidate or committee] he or she is funding” 

with that money, the former is the one “mak[ing]” a contribution to that candidate. Cf. AR 172. 

It is no accident that the FECA and FEC regulations use the same language to identify the 

source of an independent expenditure as they use to identify the source of a contribution: both 

look to the identity of the person who “makes” the transaction. Compare 52 U.S.C. 

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§ 30104(b)(3)(A) with id. § 30104(c)(1). Both look to the true source of the transfer: the person 

exercising control with respect to where the money is spent. If a person controls the selection of 

the recipient of funds, then that person “makes the contribution.” But if one controls the final 

expenditure the funds are used to create, then that person makes the expenditure. 

By limiting the requirement to report contributions to those who give for the purpose of 

furthering a specific identified independent expenditure, the FEC makes the contributor 

disclosure provision redundant to provisions requiring those making independent expenditures 

disclose themselves. Clearly Congress could not have intended for its reporting requirement 

under subsection (c)(2)(C) to merely capture individuals who must also make their own reports 

under the FECA for making independent expenditures. 

Simply put, the regulation cannot be reconciled with the language or purpose of 52 

U.S.C. § 30104(c)(2)(C). It fails under both Chevron steps one and two. Accordingly, the rule is 

invalid and must be stricken. See Shays, 414 F.3d at 105–10 (invaliding regulation that failed 

under Chevron’s step one or two); Nat’l Mining Ass’n, 145 F.3d at 1409 (vacating agency 

regulation after finding agency’s interpretation of statute on which regulation depended failed 

Chevron analysis). 

IV. The FEC’s Dismissal of the Subsection (c)(2)(C) Violation was Contrary to Law 

The FEC refused to find reason to believe Crossroads GPS violated 52 U.S.C. 

§ 30104(c)(2)(C) solely because it found 11 C.F.R. § 109.10(e)(1)(vi) “constitutes the 

Commission’s controlling interpretation of the statutory provision.” AR 175. Because the 

regulation was invalid for reasons stated above, the FEC’s dismissal was based on an 

impermissible interpretation of law, and thus the dismissal is contrary to law. Orloski, 795 F.2d 

at 161; CREW v. FEC, 209 F. Supp. 3d 77, 93 (D.D.C. 2016) (setting aside dismissal where FEC 

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39 

“based its decision upon an improper legal ground”); see also Barnett v. Weinberger, 818 F.2d 

953, 954 (D.C. Cir. 1987) (holding agency decision premised on invalid regulation at odds with 

statute was arbitrary).16

V. Subsection (c)(1) Imposes “Additional” Disclosure Obligations and the FEC’s 

Failure to Enforce was Contrary to Law 

Separate and distinct from the reporting obligations contained in 52 U.S.C. 

§ 30104(c)(2)(C) and misinterpreted by the FEC in 11 C.F.R. § 109.10(e)(1)(vi) is the reporting 

obligation contained in 52 U.S.C. § 30104(c)(1). That provision requires a person making an 

independent expenditure to report “the information required under subsection (b)(3)(A) for all 

contributions received by such person.” 52 U.S.C. § 30104(c)(1). The referenced subsection, 

which provides reporting obligations for political committees, requires “the identification of each 

person . . . who makes a contribution to the reporting [party] . . . , whose contributions have an 

aggregate amount or value in excess of $200 with the calendar year . . . together with the date 

and amount of any such contribution.” Id. § 30104(b)(3)(A). As the Supreme Court recognized 

in MCFL, the provision plainly requires those making independent expenditures “to identify all 

contributors who annually provide in the aggregate $200 in funds intended to influence 

elections.” 479 U.S. at 262. The appearance of the requirement in the “plain language” of the 

statute gives “fair notice” to regulated parties. Freeman United Coal Min. Co. v. Fed. Mine 

Safety and Health Review Comm’n, 108 F.3d 358, 362 (D.C. Cir. 1997) (“Accordingly, 

regulations will be found to satisfy due process so long as they are sufficiently specific that a 

reasonably prudent person, familiar with the conditions the regulations are meant to address and 

 16 Unconstrained by the unlawful regulation, the FEC would very likely have found a violation of 

subsection (c)(2)(C). See AR 174. 

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the objectives the regulations are meant to achieve, would have fair warning of what the 

regulations require.”). The case is not among the “the very limited set of cases” in which courts 

have found lack of required notice. Suburban Air Freight, Inc. v. Transp. Sec. Admin, 716 F.3d 

679, 684 (D.C. Cir. 2013). 

The OGC recognized that subsection (c)(1) “impose[s] additional reporting obligations” 

to subsection (c)(2)(C) “for certain contributions made for the purpose of influencing a federal 

election generally” that is not covered by the regulation. AR 175. The OGC was correct, as the 

Supreme Court recognized in MCFL, that the FECA provides two separate reporting obligations 

for those making independent expenditures: they must “(1) identify all contributors who 

contribute in a given year over $200 in the aggregate in funds to influence elections, 

§ [30104](c)(1); . . . and ([2]) identify any persons who make contributions over $200 that are 

earmarked for the purpose of furthering independent expenditures, § [30104](c)(2)(C).” 479 

U.S. at 242.17 

This paired reporting is sensible. Under the FECA, voters would have access to two 

categories of information. First, they would know who contributed significant funds to the 

organization for the purpose of creating independent expenditures. Second, to ensure that voters 

have a full picture of the financial backing behind the group creating an ad and to ensure sources 

of funds are not excluded due to various wink-and-nod schemes, voters would know who 

 17 The OGC recognized that 11 C.F.R § 109.10(e)(1)(vi) was in no way a construction of or 

attempt to apply 52 U.S.C. § 30104(c)(1). AR 175–76 (noting the regulation is “silent 

concerning any such additional reporting”). Accordingly, it is not the agency’s position that the 

regulation reflects the amendments to subsection (c)(1), despite the explanation and justification 

asserting the regulation “incorporate[d] the changes set forth at 2 USC 434(c)(1) and (2).” AR 

1503. The agency’s current position is correct: in no way could the regulation be deemed a 

valid interpretation of subsection (c)(1) which expressly places a temporal focus on the 

contributions and omits the purposive language contained in subsection (c)(2)(C). 

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41 

provided significant amounts to the organization to fund its political work within a relatively 

confined yet useful time-period before the ad ran. 

Nonetheless, despite the existence of this distinct reporting provision and the inescapable 

conclusion that Crossroads GPS has not complied with it, the FEC refused to find reason to 

believe below because “a Respondent could raise equitable concerns about whether a filer has 

fair notice of the requisite level of disclosure required by law if the Commission attempted to 

impose liability under Section [30104](c)(1).” AR 176. The conclusion, however, is erroneous 

and does not justify dismissal. 

The fact that the FECA imposes two contribution-disclosure obligations is clear on the 

face of the statute. There is no dispute that those making independent expenditures know they 

must report information about the expenditures and their contributions under 52 U.S.C. 

§ 30104(c)(1). Any reader would plainly see that the statute requires reporting information 

under subsection (b)(3)(A) for “all contributions” and that the referenced section requires 

disclosing all contributions received within the year. The reader would also be aware that this is 

a separate requirement, under a separate subsection of the statute, from the requirement to report 

contributions provided “for the purpose of furthering an independent expenditure.” 52 U.S.C. 

§ 30104(c)(2)(C). They would also know that subsection (c)(1)’s requirement is plainly different 

than subsection (c)(2)(C)’s, as the former does not have the latter’s “for the purpose of” limiting 

language. That is why the Court in MCFL recognized without any difficulty that a person 

making independent expenditures would have to report two sets of contributors: those giving 

more than $200 annually for any political purpose, and those giving more than $200 to further 

independent expenditures. 479 U.S. at 242, 262. The statute “provides a person of ordinary 

intelligence fair notice of what is” required. Holder v. Humanitarian Law Project, 561 U.S. 1, 

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18–19 (2010) (“[A] plaintiff who engages in some conduct that is clearly proscribed cannot 

complain of the vagueness of the law as applied to the conduct of others.”); United States v. 

Williams, 553 U.S. 285, 306 (2008) (finding “[c]lose cases can be imagined under virtually any 

statute” but they do not render statute so vague as to deny fair notice); Grayned v. City of 

Rockford, 408 U.S. 104, 108–14 (1972) (“[W]e insist that laws give the person of ordinary 

intelligence a reasonable opportunity to know what is prohibited, so that he may act 

accordingly,” but “we can never expect mathematical certainty from our language”; noting 

judicial constructions of statute may provide clarity missing from text sufficient to provide “fair 

warning”). 

The fact that 11 C.F.R. § 109.10(e)(1)(vi) does not construe or apply subsection (c)(1) 

also does not relieve a party from the obligations of the statute. “Adoption of a regulation that 

does not implement the statute in its full extent does not erase the statutory requirement.” 

McConnell, 540 U.S. at 322 (Kennedy, J., concurring in part and dissenting in part). Parties are 

still obliged to follow the dictates of the FECA, even if the FEC has not incorporated those 

requirements into its regulations. 

Moreover, even if a hypothetical respondent might have a case for lack of notice, 

Crossroads GPS had actual notice of its reporting obligations. As it continually asserted to the 

FEC, Crossroads GPS “understands the applicable reporting” requirements of the law. AR 48. 

“Crossroads GPS is fully aware of its FEC reporting and disclosure obligations . . . [and] has 

never failed to report contributions required to be reported under the Act and FEC regulations.” 

AR 81. By Crossroads GPS’s own admission, therefore, it was aware of its obligation under 

subsection (c)(1) to report all contributors who provide more than $200 annually to the group, 

but consciously chose to ignore that obligation. 

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Nor is this a case where a fair notice argument would apply. While courts have said that 

regulated entities must receive fair notice of a new regulatory policy before they may be 

sanctioned, see FCC v. Fox Television Stations, Inc., 567 U.S. 239, 246–48, 254 (2012) (finding 

television stations could not be sanctioned for fleeting expletives where they had no fair notice of 

a change in FCC policy from agency precedent and stated policy permitting fleeting uses), those 

situations arise where the agency has a declared interpretation of a statute or rule or sets a policy 

and then changes course, id. at 254, not where there is a rule plainly stated in the statute. 

Moreover, even if Crossroads GPS could argue that it lacked sufficient fair notice to allow for a 

sanction, the FEC would still be free to impose equitable remedies to address CREW’s and 

voters’ injuries stemming from the lack of knowledge of who is financially backing candidates 

and elected officials. While fair notice may be a legitimate defense to the FECA’s criminal 

penalties, see 52 U.S.C. § 30109(a)(6), (d) (providing for civil and criminal penalties for 

knowing and willful violations), or to “sufficiently grave” criminal-like sanctions, Satellite 

Broadcasting Co., Inv. v. FCC, 824 F.2d 1, 3 (D.C. Cir. 1987), it is no defense to providing 

voters with information to which they are entitled. See also GE v. EPA, 53 F.3d 1324, 1330–31 

(D.C. Cir. 1995) (noting that “fair notice” precedent did not resolve agency enforcement in “nonpenal context” and that the agency could still require group to comply if it withheld punishment). 

Finally, the OGC did not find that Crossroads GPS would have a valid claim for lack of 

fair notice that would prohibit enforcement; rather, it found that Crossroads GPS “could raise” 

such an argument, and therefore decided to dismiss “as a prudential matter in the exercise of its 

prosecutorial discretion.” AR 176. The FEC, however, must “suppl[y] reasonable grounds” for 

its prosecutorial discretion, Nader v. FEC, 823 F. Supp. 2d 53, 65 (D.D.C. 2011), which the 

OGC did not do here for reasons outlined above. Further, if the only concern the FEC has is that 

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it does not wish to enforce the law against Crossroads GPS because it does not wish to spend the 

resources to contest a fair notice defense, then the FECA provides for a ready back up: the 

FECA authorizes a citizen suit by CREW. See 52 U.S.C. § 30109(a)(8)(C) (permitting “the 

complainant [to] bring, in the name of such complainant, a civil action to remedy the violation 

involved in the original complaint”). That suit would not expend any of the FEC’s resources. 

But before CREW can bring that suit, the Court must find the FEC’s dismissal will permit 

activity “contrary to law.” See id. (proscribing a citizen suit after FEC fails to conform with 

court order declaring previous dismissal was contrary to law). 

In short, 52 U.S.C. § 30104(c)(1) imposes a distinct reporting requirement separate from 

the requirement of subsection (c)(2)(C). The requirement is plainly stated on the face of the 

statute. There is no credible dispute that there is reason to believe Crossroads GPS has failed to 

comply with that obligation. Accordingly, the dismissal of CREW’s complaint for Crossroads 

GPS’s violation of subsection (c)(1) was contrary to law. 

VI. The FEC’s Failure to Find Reason to Believe 11 C.F.R. § 109.10(e)(1)(vi) May Have 

Been Violated was Contrary to Law 

Lastly, even assuming 11 C.F.R. § 109.10(e)(1)(vi) was a valid regulation that reasonably 

interpreted 52 U.S.C. § 30104(c)(1) or (c)(2)(C), the FEC’s failure to find reason to believe that 

Crossroads GPS may have violated it was still contrary to law. CREW identified a number of 

facts in its complaint, admitted to by respondents, that established that Crossroads GPS took at 

least $3 million “to use to support the election of Josh Mandel.” AR 174. CREW further 

identified facts in its complaint, admitted to by respondents, to indicate that Crossroads GPS 

received another $1.3 million in “matching” donations, money which was raised to “match[]” the 

$3 million given for the purposes of aiding the election of Josh Mandel and to fill out the rest 

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Crossroads GPS’s $6 million budget for Ohio. AR 96–97, 103–04. CREW further alleged that 

the attendees at the Tampa fundraiser were shown independent expenditures, which the 

respondents admitted were used as “examples” of the activities raised funds would support and 

which mirrored the ads that eventually ran. AR 77–78, 104–05. 

In light of these factual allegations, substantiated by the respondents, there was more than 

a “reason to believe” Crossroads GPS “may have” violated the FECA by accepting contributions 

given for the purpose of furthering the reported independent expenditures. 72 Fed. Reg. at 12545 

(discussing reason to believe standard under 52 U.S.C. § 30109(a)(2)). “[T]he available 

evidence in the matter is at least sufficient to warrant conducting an investigation.” Id. Here, 

even a short investigation into any communications between Mr. Rove and the unnamed donor 

could reveal the contributor knew the uses of his funds. Similarly, the FEC could probe the 

intentions behind the various contributors of the matching funds and the attendees at the Tampa 

fundraiser to gather more evidence about any promises the fundraisers may have made. Since 

there is nothing to rule out the possibility that the donors gave for the purpose of furthering the 

reported independent expenditures and because CREW credibly alleged sufficient facts to give 

reason to believe the rule may have been violated, the FEC’s dismissal of CREW’s complaint 

about Crossroads GPS’s violations of 11 C.F.R. § 109.10(e)(1)(vi) was similarly contrary to law. 

CONCLUSION 

For the reasons stated above, CREW respectfully requests this Court grant it summary 

judgment, declare the dismissal below was contrary to law, and declare invalid and vacate 11 

C.F.R. § 109.10(e)(1)(vi). 

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Dated: September 11, 2016. 

Respectfully submitted, 

/s/ Stuart C. McPhail 

Stuart C. McPhail 

smcphail@citizensforethics.org

(D.C. Bar No. 1032529) 

Adam J. Rappaport 

arappaport@citizensforethics.org

(D.C. Bar No. 479866) 

Citizens for Responsibility and Ethics 

in Washington 

455 Massachusetts Ave., N.W., Sixth Floor 

Washington, D.C. 20001 

Telephone: (202) 408-5565 

Fax: (202) 588-5020 

Attorneys for Citizens for Responsibility and 

Ethics in Washington and Nicholas 

Mezlak 

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