UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF COLUMBIA 

 

 ) 

CHRIS VAN HOLLEN, ) 

 ) 

 Plaintiff, ) Civ. No. 1:11-766 (ABJ) 

 ) 

 v. ) 

 ) FEC’S SUPPLEMENTAL MEM. 

FEDERAL ELECTION COMMISSION, ) 

 ) 

 Defendant. ) 

 ) 

DEFENDANT FEDERAL ELECTION COMMISSION’S RESPONSE 

TO PLAINTIFF’S SUPPLEMENTAL MEMORANDUM 

Anthony Herman 

General Counsel 

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

Deputy General Counsel – Law 

Kevin Deeley 

Acting Associate General Counsel 

Harry J. Summers 

Assistant General Counsel 

Holly J. Baker 

Attorney 

Seth Nesin 

Attorney 

COUNSEL FOR DEFENDANT 

FEDERAL ELECTION COMMISSION 

999 E Street, NW 

Washington, DC 20463 

Telephone: (202) 694-1650 

 

Case 1:11-cv-00766-ABJ Document 90 Filed 04/29/13 Page 1 of 12
TABLE OF CONTENTS 

 Page 

I. VAN HOLLEN’S “ADDITIONAL” ARGUMENTS LACK MERIT ..........................1 

A. The Regulation’s “Purpose of Furthering Electioneering 

Communications” Standard Is a Reasonable Construction of an 

Ambiguous Statute Entitled to Deference ..........................................................2 

B. The Commission Relied Upon Ample Evidence in Promulgating 

the Rule and Fairly Applied Congressional Intent to Unforeseen 

Circumstances ...................................................................................................3 

II. THE SCOPE OF SECTION 104.20(c)(9) CHANGED FOLLOWING 

CITIZENS UNITED .......................................................................................................5 

III. CONCLUSION ..............................................................................................................9

Case 1:11-cv-00766-ABJ Document 90 Filed 04/29/13 Page 2 of 12
1

The Court should uphold 11 C.F.R. § 104.20(c)(9), the Federal Election Commission’s 

(“Commission” or “FEC”) regulation governing donor disclosures by corporations and unions 

that make electioneering communications, because the rule represents a reasonable agency 

interpretation of an ambiguous statute. The Commission adapted the disclosure regime to take 

into account two Supreme Court decisions striking down the electioneering communication 

provision in FECA and permitting labor unions and corporations to make electioneering 

communications. The adapted language plaintiff Chris Van Hollen challenges here was drawn 

from another disclosure provision passed by Congress, and the Commission’s rule carefully 

balances competing interests, as any regulatory implementation of the statute must. It is a 

reasonable decision supported by ample evidence. 

I. VAN HOLLEN’S “ADDITIONAL” ARGUMENTS LACK MERIT

Plaintiff Van Hollen’s supplemental brief begins with a rehash of flawed arguments 

advanced in prior filings. Having already demonstrated the flaws in those arguments and 

consistent with this Court’s March 18 Minute Order, the Commission will not address them 

again here.1

 Van Hollen devotes the remainder of his brief to two “additional arguments” and a 

conclusion about the appropriate remedy should the Court find the regulation unlawful. 

(Plaintiff’s Supplemental Briefing on Remanded Issues (“Pl’s Supp. Br.”) at 4-8 (Doc. No. 87).) 

These arguments are also based to a significant extent on points Van Hollen has made in earlier 

briefs, but the Commission nevertheless briefly responds to them here. Van Hollen effectively 

attempts to relitigate whether the Commission’s regulation passes muster at Chevron step one. 

These arguments must again fail. 

                                                           

1

   (See Def. FEC’s Mem. of P&As in Supp. of its Mot. for Summ. Judg. and in Opp. to Pl.’s 

Mot. for Summ. Judg. (“FEC S.J. Mem.”) (Doc. No. 24); Def. FEC’s Reply in Supp. of Its Mot. 

for Summ. Judg. (“FEC Reply”) (Doc. No. 40); Def. FEC’s Reply to the Mots. of Hispanic 

Leadership Fund and Center for Individual Freedom (Doc. No. 42).)

Case 1:11-cv-00766-ABJ Document 90 Filed 04/29/13 Page 3 of 12
2

A. The Regulation’s “Purpose of Furthering Electioneering Communications” 

Standard Is a Reasonable Construction of an Ambiguous Statute Entitled to 

Deference 

Van Hollen argues that the Commission’s regulation is unlawful because it conflicts with 

Congress’s central purpose, which Van Hollen suggests was to provide the public with 

information about how sponsors of electioneering communications acquired funds to engage in 

such communications. (Pl’s Supp. Br. at 4.) That argument is unsustainable. 

Van Hollen’s strained argument is premised on the suggestion that section 104.20(c)(9) 

requires the Commission to establish the “subjective intent” of a donor before disclosure is 

required. Not so, as the Commission has already demonstrated. (See FEC S.J. Mem. at 33 (“The 

regulation does not rely solely on statements (public or private) by donors, but applies objective 

standards to determine which donations meet the regulatory standard.”).) 

Van Hollen also argues that Congress would disapprove of the Commission’s regulation 

because Congress would believe a purpose requirement “would be prone to evasion.” (Pl’s 

Supp. Br. at 4.) This argument falters as well. The language of the regulation was drawn from a 

different disclosure provision passed by Congress. 72 Fed. Reg. at 72911 n.22 (“The ‘for the 

purpose of furthering’ standard in 11 CFR 104.20(c)(9) is drawn from the reporting requirements 

that apply to independent expenditures made by persons other than political committees. See 2 

U.S.C. 434(c)(2)(C), 11 CFR 109.10(e)(1)(vi).”). Given that Congress enacted one disclosure 

provision with an express purpose requirement, there is no reason to assume that Congress would 

believe section 104.20(c)(9) was unlawfully “prone to evasion.” 

Van Hollen further argues that if Congress had wanted a purpose requirement, “it 

certainly knew how to do this.” (Pl’s Supp. Br. at 5.) But at the time Congress passed BCRA, 

the overwhelming majority of corporations (and all labor unions) were prohibited from making 

Case 1:11-cv-00766-ABJ Document 90 Filed 04/29/13 Page 4 of 12
3

electioneering communications. Congress would have had no reason to insert such language to 

govern disclosure by stock corporations, which are especially likely to have general treasury 

funds received from those who “do not necessarily support the corporation’s electioneering 

communications.” 72 Fed. Reg. 72899, 72911. 

Lastly, Van Hollen’s argument is at odds with his prior claim that Congress desired 

disclosure because it “recognized that persons who finance ‘electioneering communications’ 

often stand to benefit economically from the election or defeat of a candidate or acceptance or 

rejection of a bill, and that voters are in a better position to evaluate such communications when 

the identity of the financier has not been cloaked.” (Plaintiff’s Motion for Summary Judgment at 

23 (“Pl’s S.J. Mem.”) (Doc. No. 20).) If the purpose of disclosure is to give voters information 

about donors who stand to benefit from a persuasive electioneering communication, then that 

goal would actually be thwarted if disclosure included donors who gave for unrelated purposes. 

(See FEC S.J. Mem. at 33 (“[S]uch a broad sweep of information would be misleading and could 

implicate privacy interests of those identified despite having no connection at all to the 

electioneering communications.”).) 

B. The Commission Relied Upon Ample Evidence in Promulgating the Rule and 

Fairly Applied Congressional Intent to Unforeseen Circumstances 

Van Hollen claims that the Commission “fails to adduce evidence that the challenged 

regulation would even achieve the narrower objective the FEC, mistakenly, articulated” (Pl’s 

Supp. Br. at 5), but this argument is unpersuasive and not entirely new. Van Hollen has 

criticized the Commission in previous filings for alleged evidentiary deficiencies in its 2007 

rulemaking regarding reporting burdens on regulated entities (see, e.g., Pl’s S.J. Mem. at 29 

(“The FEC did not present any data or facts in its E&J to support this assertion or to quantify the 

Case 1:11-cv-00766-ABJ Document 90 Filed 04/29/13 Page 5 of 12
4

cost and effort involved.”)). And the Commission has refuted these erroneous claims (see FEC 

Reply at 15-17). 

Van Hollen now reconfigures his prior argument to focus on how much disclosure the 

proposed regulation would garner, claiming that the FEC was required to present rulemaking 

evidence that section 104.20(c)(9) would lead to “full disclosure of donors who give for reasons 

related to the making of [electioneering communications].” (Pl’s Supp. Br. at 6.) But Van 

Hollen cites no authority for the proposition that the regulation must lead to “full” disclosure. 

Nor could he — especially given that Congress did not intend the speakers at issue to be making 

electioneering communications. Even if Congress could somehow have foreseen later Court 

rulings, “no legislation pursues its purposes at all costs.” Rodriguez v. United States, 480 U.S. 

522, 525-26 (1987). (See FEC S.J. Mem. at 26-28.) The Commission carefully balanced the 

interests in disclosure with other interests, including privacy, administrative burden, and the 

avoidance of potentially misleading disclosures. In doing so, the Commission evaluated 

considerable evidence relevant to these important interests. (See, e.g., FEC Reply at 15-17 

(describing comments and testimony considered by the FEC during the rulemaking process).) 

In addition, “full disclosure” is an illusory goal. In this Court’s earlier ruling, for 

example, the Court noted that if the statute were ambiguous, the Commission could permissibly 

limit disclosure to “donors” and thus certain funding sources need not be disclosed under the 

statute. See Van Hollen v. FEC, 851 F. Supp. 2d 69, 86 n.8 (D.D.C.) (“Is it really difficult to 

determine if dues paid in return for the benefits of membership are ‘donations,’ or if investors 

who pay for shares of stock and customers who pay for goods and services are a corporation’s 

‘donors?’”), rev’d sub nom. CFIF, 694 F.3d 108 (D.C. Cir. 2012). If corporations and labor 

unions are permitted to use membership dues, investor funds, and profits to fund electioneering 

Case 1:11-cv-00766-ABJ Document 90 Filed 04/29/13 Page 6 of 12
5

communications, there will inevitably be electioneering communications that are not entirely 

accounted for by donations.2

 

Finally, Van Hollen relies on recent statistics about donor disclosure by corporations 

engaged in electioneering communications. (Pl’s Supp. Br. 5-7.) But that information is 

irrelevant to whether the Commission issued a lawful regulation in 2007, because the 

reasonableness of the regulation can only be judged based upon the information that the agency 

had at that time and the agency’s stated basis for its decision. (See FEC S.J. Mem. at 38-41; FEC 

Reply at 17-18.)3 

II. THE SCOPE OF SECTION 104.20(c)(9) CHANGED FOLLOWING CITIZENS 

UNITED 

 In remanding this case, the D.C. Circuit sought clarification from the Commission as to 

“the reference to 11 C.F.R. § 114.15 in § 104.20(c)(9).” Ctr. for Individual Freedom (“CFIF”) 

                                                           

2 Van Hollen also argues that if the Court finds section 104.20(c)(9) unlawful, it should 

vacate the regulation because such an order would purportedly not be “disruptive.” (Pl’s Supp. 

Br. at 7 (quoting Allied-Signal, Inc. v. U.S. Nuclear Regulatory Comm’n, 988 F.2d 146, 151 

(D.C. Cir. 1993).) But as the Commission has already explained, the appropriate remedy should 

the Court find the regulation unlawful would be to remand to the agency without vacating the 

regulation. (See FEC S.J. Mem. at 43-45; FEC Reply 19-23.) Revival of the Commission’s 

2003 regulations would also not be appropriate. See Small Refiner Lead Phase-Down Task 

Force v. EPA, 705 F.2d 506, 553-54 (D.C. Cir. 1983) (declining to reinstate prior regulation). 

Because the 2003 regulations did not address the question of disclosure for corporate 

electioneering communications, they provide no guidance that is not already contained in the 

statute, and reviving those regulations could create substantial confusion. (See FEC Opp. to 

Motion for Leave to File Am. and Supp. Ans. and Cross Claims of Intervenor Def. CFIF at 3-4 

n.1 (Doc No. 88).)

3

 Van Hollen also incorrectly relies (Pl’s Supp. Br. at 5-7) on two recent statements by 

single Commissioners. Citation to those statements is impermissible because they relate to a 

separate, later rulemaking and because such views of a single Commissioner do not represent the 

position of the agency itself, which can only act through a majority of its members. See 2 U.S.C. 

§ 437c(c); Sprint Nextel Corp. v. FCC, 508 F.3d 1129, 1132 (D.C. Cir. 2007) (finding that 

statements by individual Commissioners “are not institutional Commission actions”); see also 

FTC v. Flotill Prods., Inc., 359 U.S. 179, 183 (1967) (stating that it is the “almost universally 

accepted common-law rule” that only a “majority of a collective body is empowered to act for 

the body”). 

Case 1:11-cv-00766-ABJ Document 90 Filed 04/29/13 Page 7 of 12
6

v. Van Hollen, 694 F.3d 108, 111 (D.C. Cir. 2012). The Circuit could not discern the purpose of 

the cross reference and decided, on remand, to “leave it to the FEC in the first instance to explain 

the meaning and scope of 11 C.F.R. § 104.20(c)(9).” Id. As explained below, the cross 

reference is the product of the regime in place before Citizens United, when corporations and 

labor unions were barred from making electioneering communications. In the wake of the 

Supreme Court’s decision, however, 11 CFR § 114.15 is an obsolete historical anomaly that has 

no functional purpose or regulatory meaning. In other words, Citizens United effectively read 

section 114.15 out of section 104.20(c)(9). 

 For decades, it was unlawful for corporations (and labor unions) to finance independent 

campaign expenditures with their treasury funds. 2 U.S.C. § 441b. In 1986, the Supreme Court 

held in FEC v. Massachusetts Citizens for Life, Inc., 479 U.S. 238, 248-49 (1986) (“MCFL”) that 

this prohibition was unconstitutional as applied to certain advocacy corporations. The 

corporations covered by the MCFL decision were those that had been formed for the sole 

purpose of promoting political ideas, could not engage in business activities, and could not 

accept contributions from for-profit corporations or unions. Id. at 263-64. The FEC, in its 

regulations, denonimates such organizations as “qualified nonprofit corporations” or “QNCs.” 

See 11 C.F.R. § 114.10. 

In the Bipartisan Campaign Reform Act of 2002 (“BCRA”), Congress established a 

disclosure regime for “electioneering communication[s]” and prohibited corporations and labor 

unions from financing such communications with general treasury funds. 2 U.S.C. §§ 

434(f)(3)(A)(i); 441b(a), (b)(2).4

 When, in 2003, the Commission promulgated the 

                                                           

4

 An “electioneering communication” under BCRA is any broadcast, cable, or satellite 

communication that refers to a clearly identified candidate for federal office, is publicly 

Case 1:11-cv-00766-ABJ Document 90 Filed 04/29/13 Page 8 of 12
7

implementing regulations regarding electioneering communications disclosure, there was no 

generally applicable provision for corporations or labor unions due to the statutory ban on such 

communications. The Commission determined, however, that, just as the Supreme Court in 

MCFL had permitted QNCs to make independent expenditures, the Constitution required that 

qualified nonprofit corporations should be permitted to finance and sponsor electioneering 

communications. Electioneering Communications, 67 Fed. Reg. 65190, 65203-04 (Oct. 23, 

2002). These QNCs were required to comply with the same donor disclosure obligations as 

other entities that could pay for electioneering communications (such as unincorporated 

associations), specifically the reporting requirements in then-11 C.F.R. § 104.20(c)(7) and (8). 

See 11 C.F.R. § 104.20(c) (effective Feb. 3, 2003, to Dec. 25, 2007); Bipartisan Campaign 

Reform Act of 2002 Reporting, 68 Fed. Reg. 404, 412-13, 419 (Jan. 3, 2003). In McConnell v. 

FEC, the Supreme Court upheld the electioneering communications provisions on their face and 

agreed with the Commission that — consistent with MCFL — qualified nonprofit corporations 

must be permitted to make electioneering communications. 540 U.S. 93, 209-12 (2003). 

Four years later, the Supreme Court held in FEC v. Wisconsin Right to Life, Inc., 

(“WRTL”), that all corporations had a constitutional right to make electioneering 

communications that are not express advocacy or its functional equivalent. See 551 U.S. 449, 

480-81 (2007). In response to WRTL, the Commission promulgated 11 C.F.R. § 114.15, 

permitting corporations to make such communications. See Electioneering Communications, 72 

Fed. Reg. 72899, 72902-11 (Dec. 26, 2007). 

The Commission also promulgated 11 C.F.R. § 104.20(c)(9), the subject of this lawsuit, 

to govern the disclosure of the sources of funds used by corporations and labor unions to finance 

                                                                                                                                                                                               

distributed within 60 days before a general election or 30 days before a primary election, and is 

targeted to the relevant electorate. See 2 U.S.C. § 434(f)(3)(A). 

Case 1:11-cv-00766-ABJ Document 90 Filed 04/29/13 Page 9 of 12
8

electioneering communications that were not functionally equivalent to express advocacy. See

72 Fed. Reg. at 72911-12. Section 104.20(c)(9) referred to section 114.15 because the disclosure 

regime contemplated by section 104.20(c)(9) applied only to the newly-permitted corporate and 

labor union communications. Qualified nonprofit corporations, on the other hand, continued to 

make disclosures just as they made them prior to WRTL. 72 Fed. Reg. at 72911 n.21 (“A QNC 

making an electioneering communication pursuant to 11 CFR 114.10, rather than pursuant to 11 

CFR 114.15, would be required to report under 11 CFR 104.20(c)(7) or (8).”) Thus, unions and 

the vast majority of corporations making electioneering communications were required to report 

under section 104.20(c)(9).5

In 2010, the Supreme Court held in Citizens United v. FEC that corporations could not 

constitutionally be prohibited from using general treasury funds to finance electioneering 

communications, even if those communications included the functional equivalent of express 

advocacy. 558 U.S. 310, 365-66 (2010).6 Due to the prior ban on corporate and labor union 

communications, however, no current regulation explicitly contemplates such entities making 

electioneering communications equivalent to express advocacy. Nonetheless, the Commission’s 

approach to an enforcement proceeding reveals that the Commission interprets section 

104.20(c)(9) to apply at this time to all corporate and labor union electioneering 

                                                           

5

 As the Commission has explained, 72 Fed. Reg. at 72911, one of the primary concerns 

behind the “purpose of furthering” construction in section 104.20(c)(9) was to prevent 

corporations from having to disclose shareholders who have acquired stock in the corporation. 

That concern is not present for unincorporated entities and for qualified nonprofit corporations, 

which by definition have no stockholders. See 11 C.F.R. § 114.10.    

6

 “Because Citizens United struck down the statutory bans on independent expenditures 

and electioneering communications for all corporations and labor organizations, the regulatory 

exceptions for QNCs are now superfluous” and the Commission has proposed to remove them. 

Independent Expenditures and Electioneering Communications by Corporations and Labor 

Organizations, 76 Fed. Reg. 80803, 80812 (proposed Dec. 27, 2011). 

Case 1:11-cv-00766-ABJ Document 90 Filed 04/29/13 Page 10 of 12
9

communications, even those that are functionally equivalent to express advocacy and therefore 

not made “pursuant to 11 CFR 114.15.”7

 The five Commissioners who voted on that 

enforcement matter did not agree on whether to open an investigation of the particular alleged 

violation of section 104.20(c)(9), but they all treated that regulation as applicable without 

determining whether the advertisements were functionally equivalent to express advocacy.8

 

Thus, the Commission has required all corporations, including stock corporations but 

excepting QNCs, as well as labor unions to report donor information under section 104.20(c)(9) 

with respect to electioneering communications those entities are permitted to make — a category 

that after Citizens United includes communications that are the functional equivalent of express 

advocacy. Given that no provision of the regulations was promulgated in contemplation of 

corporate and labor union communications that are not made “pursuant to 11 CFR 114.15,” the 

Commission’s interpretation — which effectively reads the cross reference out of section 

104.20(c)(9) — has reasonably filled the regulatory void. 

III. CONCLUSION

For the reasons above and in the Commission’s prior briefs, 11 C.F.R. § 104.20(c)(9) is 

not contrary to law and the Court should grant summary judgment to the Commission. 

                                                           

7

 See In the Matter of Freedom’s Watch, Inc. (FEC Matter Under Review 6002 (“MUR 

6002”)). 

8 See Statement of Reasons of Chairman Matthew S. Petersen and Commissioners Caroline 

C. Hunter and Donald F. McGahn, MUR 6002, at 4, 6-8 (Aug. 12-13, 2010), 

http://eqs.nictusa.com/eqsdocsMUR/10044274536.pdf (analyzing whether donor disclosure was 

required under section 104.20(c)(9) without determining whether the communication was 

equivalent to express advocacy); Statement of Reasons of Vice Chair Cynthia L. Bauerly and 

Commissioner Ellen L. Weintraub, MUR 6002, at 4-5 (Sept. 16, 2010), 

http://eqs.nictusa.com/eqsdocsMUR/10044280805.pdf (same); see also First General Counsel’s 

Report, MUR 6002, at 3 n.1 (Mar. 12, 2010), 

http://eqs.nictusa.com/eqsdocsMUR/10044272054.pdf (“[T]he question of whether the 

advertisement at issue constitutes a permissible electioneering communication under WRTL is 

moot.”) 

 

Case 1:11-cv-00766-ABJ Document 90 Filed 04/29/13 Page 11 of 12
10

Respectfully submitted, 

Anthony Herman 

General Counsel 

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

Deputy General Counsel – Law 

Kevin Deeley 

Acting Associate General Counsel 

Harry J. Summers 

Assistant General Counsel 

/s/ Seth Nesin 

Holly J. Baker 

Seth Nesin 

Attorneys 

COUNSEL FOR DEFENDANT 

FEDERAL ELECTION COMMISSION

999 E Street, NW 

Washington, DC 20463 

Telephone: (202) 694-1650 

Fax: (202) 219-0260 

April 29, 2013

Case 1:11-cv-00766-ABJ Document 90 Filed 04/29/13 Page 12 of 12