# United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued February 20, 2015 June 5, 2015

No. 14

- 5199

P UBLIC C ITIZEN , ET AL ., A PPELLEES

C ROSSROADS G RASSROOTS P OLICY S TRATEGIES , A PPELLANT

v.

F EDERAL E LECTION C OMMISSION , A PPELLEE

Appeal from the United States District Court for the District of Columbia (No. 1:14

- cv

- 00148)

Thomas W. Kirby argued the cause for appellant. With him on the briefs were Michael E. Toner

, Brandis L. Zehr

, and Samuel B. Gedge

. Erin R. Chlopak , Attorney, Federal Election Commission, argued the cause for appellee Federal Election Commission. With her on the briefs were Kevin A. Deeley

, Acting Associate General Counsel, and Greg J. Mueller and Charles Kitcher , Attorneys.2

Before: R OGERS and B ROW N , Circuit Judges , and G INSBURG , Senior Circuit Judge

. Opinion for the Court filed by Circuit Judge B ROWN

.

B ROWN , Circuit Judge : Crossroads GPS , the beneficiary of a favorable decision by the Federal Election Commission, moved to intervene as a defendant in a suit challenging the Commission ’s ruling. The district court denied intervention, finding Crossroads’ interest s were align ed with the FEC ’s Office of General Counsel ’s

, which was defending the ruling. The court concl uded the Office of General Counsel could adequately represent Crossroads ’ interests

— even though the Office opposed Crossroads in the prior proceedings before the FEC , and even though the two parties disagree as to the administrative record and litigation s trategy.

Aesop, an Ancient Greek famous for his fables, once wrote, “ a doubtful friend is worse than a certain enemy.” Recognizing that doubtful friends may provide dubious representation, “we have often concluded that governmental entities do not adequ ately represent the interests of aspiring intervenors.” Fund f or Animals, Inc. v. Norton , 322 F.3d 728, 736 (D.C. Cir. 2003). Th e same holds true in this case. T he district court erred in denying Crossroads ’ motion for intervention as of right.

I

.

The F ederal Election Campaign Act of 1971 (“FECA” or “Act” ), 5 2 U.S.C. §§ 30101

– 30126 , 30141

– 30146 , regulates the financing of elections for federal office. For entities that qualify as “political committees,” FECA requires compliance with certain requirements, such as registering with the FEC

,3
filing periodic financial reports, and having a treasurer. See 52 U.S.C. §§ 3010 1

– 30104.

The enforcement of FECA is triggered when a private party lodges a complaint with the FEC. I d . § 30109( a)(1). The Commission notifies the respondent and provides an opportunity to explain

. Id

. T he Commission then reviews the complaint

, and any response if one is filed, to determine whether there is “reason to believe” the respondent committed a violation. I d . § 30109(a)(2). If f our of the six Commissioners conclude there is reason to believe a violation was committed , a full FEC investigatio n commences

. Id

. Conversely, i f there are fewer than four votes, the FEC dismisses the administrative complaint. See i d . § § 30106(c), 30109(a)(2).

If the Commission v otes to dismiss the complaint , the administrative complainant may sue the Commission in the United States District Court for the District of Columbia. Id . § 30109(a)(8)(A). Judicial review under section 3010 9(a)(8)(A) is limited

, and a district court will reverse the Commission’s dismissal of a complaint only if it was “contrary to law.” FEC v. Democratic Senatorial Campaign Comm ., 454 U.S. 27, 39 (1981).

When a court declares the Commission’s dismissal contrary to law, the Commission has 30 days to “conform [its] declaration .” 52 U.S.C. § 30109(a)(8)(C). But a court order cannot command a different outcome on remand ; the Commission may reach the same outcome rel ying on a different rationale. See FEC v. Akins , 524 U.S. 11, 25 (1998).

In October 2010, Public Citizen and others ( collectively “Public Citizen”) filed an administrative complaint wit h the FEC against Crossroads GPS , a nonprofit corporation whose4

purpos e is to “ research, educat [ e ] , and communicat [ e ]” about “policy issues of national importance.” J.A. 60. The complaint alle ged Crossroads violated FECA by “raising and spending significant amounts of money to influence the 2010 congressional elections” without complying with the organizational and reporting requirements applicable to federa l “political committees.” J.A. 8

. Crossroads denied the allegations in a formal response

. The FEC’s legal department, the Office of General Counsel, recommended the Commission “find reason to believe” Crossroads violated FECA by “failing to organize, register, and report as a political committee.” J.A. 56. Upon voting, however, t he Commission ’s six members divided evenly. Because of FECA’s four

- vote requirement, the Commission dismissed the complaint against Crossroads.

Public Citizen filed suit and contended the Commission’s denial of the administrative complaint was contrary to law. Crossroads quickly filed a motion to intervene , which the Commission opposed

.

The district court agreed Crossroads had standing to intervene as a defendant . It found “re

- exposure to an administrative complaint that previou sly had been decided in its favor” would “likely” cause Crossroads “to expend significant resources before the FEC” in arguing for dismissal of the complaint. J.A. 235. T he court , however, rejected Crossroads ’ broader argument that reopening of the favorab le dismissal order , alone, and without consideration of the accompanying litigation costs, created a significant potential injury

. The court found that injury was “too speculative” to support standing because even if the Commission’s dismissal order was up ended, the Commission would still need “ to vote5
to proceed with an investigation, and then vote to authorize a civil enforcement action against Crossroads.” J.A. 234 n.1.

Concerning intervention as of right, the court concluded Crossroads had failed to satisfy the requirements of Federal Rule of Civil Procedure 24

. While acknowledging that Crossroads’ and the Commission’s interests ultimately may diverge, the court found their intere sts were aligned in “defending the legality of the FEC’s dismissal.” J.A. 236. As to this narrow interest

— which, the court noted, “is the interest upon which Crossroads GPS establishes standing”

— the court concluded the FEC could adequately represent Crossr oads’ interest, even though the “FEC Office of General Counsel recommended against dismissal below.” J.A. 236. 1

We review the denial of a motion to intervene as of right de novo for issues of law, clear error as to findings of fact

, and an abuse of dis cretion on issues that “involve a measure of judicial discretion.” Fund for Animals , 322 F.3d at 732. As to questions of standing, we review them de novo. Defenders of Wildlife v. Perciasepe , 714 F.3d 1317, 1323 (D.C. Cir. 2013).

II

.

Article III standin g is not a threshold determination that courts normally make before a llowing a defendant to enter a case. T he standing inquiry is generally “ directed at those who invoke the court’ s jurisdiction, ” and most defendants are pulled into a case unwillingly

. Roeder v. Islamic Republic of

1 The district court also rejected Crossroads’ request for permissive intervention. As will be explained below, the court erred in rejecting intervention as of right , so there is no need for us to decide the permissive intervention question.6

Iran , 333 F.3d 228 , 233 (D.C. Cir. 2003). But where a party tries to intervene as another defendant, we have required it to demonstrate Article III standing , reasoning that otherwise “any organization or individual with only a philosophic identification with a defendant

— or a concern with a possible unfavorable precedent

— could attempt to intervene and influence the course of litigation.” Deutsche Bank Nat ’l. Trust Co. v. FDIC , 717 F.3d 189, 195 (D.C. Cir. 2013) (Silberman, J., c oncurring).

The standing inquiry for an interv ening

- defendant is the

same as for a plaintiff: the intervenor must show injury in fact , causation, and redressability. Deutsche Bank

, 717 F.3d at 193. Crossroads currently faces no exposure to further enfor cement proceedings before the FEC because it won a favorable ruling

. But should Public Citizen ’s suit succeed

, Crossroads ’ victory would be lost

. If that injury suffice s for standing purposes, then it rationally follows the injury is directly traceable to Public Citizen’s challenge to the FEC order; and Crossroads can prevent the injury by defeating Public Citizen’s challenge in the district court proceedings

. Put differently , if Crossroads can prove injury, then it can establish causation and redressability. See Roeder , 333 F.3d at 233

– 34

. So t he case for standing turns on whether Crossroads alleg es a sufficient injury in fact

, which the Supreme Court has described as including an invasion of a legally protected interest that is “ concrete and particularized, ” and “ actual or imminent, not conjectural or hypothetical. ” Lujan v. Defenders of Wildlife , 504 U.S. 555

, 560 (1992).

The district court found that

, if Public Citizen prevail s , Crossroads “likely would have to expend significant resources [urging the FEC again ] to dismiss the complaint.” J.A. 235

. But, the litigation expenses rational e already has been rejected in this Circuit

. See Am. Soc ’y . for Prevention of Cruelty to7

Animals v. Feld Entm ’ t, Inc ., 659 F.3d 13, 25 (D.C. Cir. 2011) (“ Unde r our case law, an organization’ s diversion of resources to litigation or to investigation in anticipation of litigation is considered a ‘self

- inflicted’ budgetary choice that cannot qualify as an injury in fact for purpo ses of standing. ”); Equa l Rights Ctr. v. Post Props. , Inc ., 633 F.3d 1136, 1140 (D.C. Cir. 2011); Nat’l Taxpayers Union, Inc. v. United States , 68 F.3d 1428, 1434 (D.C. Cir. 1995) ; Spann v. Colonial Vill., Inc ., 899 F.2d 24, 27 (D.C. Cir. 1990)

.

Crossroads’ broader theory of injury fares better . Under the current FEC order, Crossroads faces no further enforcement proceedings and, as long as the order is in place, it bars Public Citizen from pursuing the same grievance against Crossroads. See FEC v . Nat’ l Conservative Political Action Comm ., 470 U.S. 480, 488 (1985). In short , the favorable FEC ruling provides Crossroads

— as most favorable agency actions would

— with a significant benefit, similar to a favorable civil judgment, and precludes exposure to civil liability. Were Crossroads to lose that beneficial ruling, it would return to the position of a respondent subject to enforcement proceedings before a federal agency

. Crossroads understandably claim s this loss would amount to concrete inj ury.

Our cases have generally fou nd a sufficient injury in fact where a par ty benefits from agency action, the action is then challenged in court

, and an unfavorable decision would remove the party’s benefit. For example, i n Military Toxics Project v. EP A

, 146 F.3d 948 (D.C. Cir. 1998), the Chemical Manufacturers Association ( “ CMA ” ) sought to intervene on the side of the EPA in a lawsuit brought by the Military Toxics Project , who sued to overturn an EPA rule favorable to CMA . We concluded CMA had standin g to intervene because some of its members produced military munitions, and those8

me mbers benefited from the EPA’ s rule, such that they “would suffer concrete injury if the court grant[ed] the relief the petitioners [sought].” Id . at 954. In Fund f or Animals

, the Natural Resources Department of the Ministry of Nature and Environment of Mongolia ( “ NRD ” ) sought to intervene as a defendant in a suit challenging action by the Fish and Wildlife Service (‘FWS”)

. 322 F.3d at 730. The Fund for Animals challeng ed FWS’ failure to classify argal i s heep as an endangered species. NRD sou ght to intervene as a defendant, alleging that, if the district court overturned the Secretary’s order and argali sheep were declared endangered species, Mongolia would lose tourist dollars associated with sheep hunting and a consequent reduction in funding for its conservation program. Id . at 733. We found NRD’s “threatened loss of tourist dollars” and the “consequent reduction in funding for Mongolia’s conservation program” constitu ted a “concrete and imminent injury .” Id

. By contrast, i n Deutsche Bank

, we found a potential interven or

- defendant’s claim of injury too attenuated to constitute a sufficient injury. There, holder s of senior notes issued by a failed bank sought to intervene as a defendant in litigation between Deutsche Bank and the FDIC, which acted as the failed bank’s receiver. In deciding the standing question, we noted that the district court would need to reach a part icular legal conclusion

— that the receiver retained the underlying liability at issue

— before the intervenor’s interest would be at stake

. Deutsche Bank , 717 F.3d at 193. We consequently held that w here a “threshold legal interpretation
must come out a specific way before a part y’s interests are even at risk, it seems unlikely that the prospect of harm is actual or imminent.” Id

. We also explained the real threat to the note holders ’ legally protected interests was not the litigation at all, but instea d whether the FDIC would enter into9
what the note holders regarded as an unfavorable settlement. Id

. The claimed injury here falls on the Fund for Animals and Military Toxics Project side of the line. Those cases stand for the proposition that even where the possibility of prevailing on the merits after remand is speculative

, a party seeking to uphold a favorable ruling can still suffer a concrete injury in fact . In Fund for Animals , for example, we did not require the NRD to show that overturning the Secretary’s ruling would certainly result in a declaration that argali sheep

are an endangered species

. Crossroads currently claims a significant benefit from the FEC’s dismissal order . As long as it is in place, Crossroads faces no further exposure to

en forcement proceedings before the FEC related to the complaint, nor is it exposed to civil liability via private lawsuit. See Nat’l Conservative , 470 U.S. at 488

– 89. Losing the favorable order would be a significant injury in fact

. And,

u nlike Deutsch e Bank , there is no threshold legal determination that might obviate Crossroads’ interest in upholding the dismissal order.

In one sense, Crossroads’ threatened injury is even greater than the injuries we found sufficient in our previous cases. The defendants in those cases sought to uphold agency action affecting them indirectly. In Fund for Animals , the NRD sought to intervene because the Secretary’s order tangentially benefited Mongolia’s tourist industry and conservation efforts

. 322 F.3d at 733. In Military Toxics Project , the defendant claimed its members benefited indirectly from an EPA rule regarding munitions

. 146 F.3d at 954. Here, by contrast, the agency action at issue involved potential direct regulation of Crossroads

— i.e
., a determination of whether Crossroads was a political committee required to register with the FEC

. See 52 U.S.C. §§10

30102

– 30104. Crossroads thus has a significant and direct interest in the favorable action shielding it from further litigation and liability ; and th e “threat ened loss” of that favorable action constitute s a “ concrete and imminent injury.” Fund for Animals , 322 F.3d at 733.

The Commission contends Crossroads must establish Public Citizen will prevail in order to prove the injury in fact

. But o ur cases have never required , as the cost of admission, an intervenor

- defendant to prove the me rits of its adversary’s

case

. For standing purposes, it is enough that a plaintiff seeks relief, which, if granted, would injure the prospective intervenor. See id

.

The Comm ission also claims the specter of the district court invalidating the dismissal order portends mere speculative harms. T he Commission maintains there is no guarantee it would ultimately file a civil enforcement suit against Crossroads even if the district cour t were to invalidate the order. It could conceivably vote to dismiss the enforcement proceedings again on other grounds

. The Supreme Court considered and rejected a similar claim in Clinton v. City of New York , 524 U.S. 417 (1998). There, New York Ci ty challenged the President’s line

- item veto authority after the President vetoed a provision shielding the state from liability for certain tax payments. The vetoed statute allowed the state to file for a statutory waiver from tax liability with Departmen t of Health and Human Services ( “ HHS ” ). Importantly, HHS had yet to rule on New York ’ s waiver at the time the state filed the lawsuit. Id . at 422. On appeal, the government objected to standing, arguing the City’s “contingent liability” would never materialize becaus e HHS had not yet acted on the state waiver request. Id . at 430. The Court rejected that argument and compared the11
President’s actions to a “judgment of an appellate court setting aside a verdict for the defendant and remanding for a

new trial of a multibillion

- dollar damages claim.” Id . at 430

– 31. “Even if the outcome of the second trial is speculative,” the Court held , “the reversal, like the President’s cancellation, causes a significant immediate injury by depriving the defendant of th e benefit of a favorable final judgment.” Id . at 431. Here, even if the district court cannot command the precise enforcement route the Commission must take on remand , invalidating the dismissal order would extinguish the current barrier to enforcement and would limit the Commission’s discretion in the future. Whatever the ultimate outcome, Crossroads has a concrete stake in the favorable agency action currently in place.

III

. The Commission also argues that prudential standing prevents the court from h earing this case because Crossroads’ interests do not fall within the zone of interests FECA protects. We disagree.

We have applied the prudential standing doctrine to intervenor

- defendants under the theory that it was a “jurisdiction [al] concept” on p ar with Article III standing. See Deutsche Bank, 717 F.3d at 194 n.4. But the Supreme Court’s decision in Lexmark Int’l, Inc. v. Static Control Components, Inc ., 134 S.Ct. 1377 (2014)

, makes plain the zone of interests test no lon ger falls under the pruden tial standing umbrella. Id

. at 1386

– 87 . N or is it a jurisdictional requirement. Id . at 1387 n.4. Instead , the zone of interest test is now “ a merits issue.” United States v. Emor , No. 13

- 3071, 2015 WL 2061817 at *5 (D.C. Cir. May 5, 2015). Whether a “plaintiff” comes within the z one of interests, the Court stated , “is an issue that requires us to determine, using traditional tools of statutory12
interpretation, whether a legislatively conferred cause of action encompasses a particular plainti ff’ s claim. ” Lexmark

, 134 S. Ct. at 1387. Or, put another way , a court asks whether the plaintiff “has a cause of action under the statute.” Id

.

We asked the parties to address how the zone of interests test applies to intervening defendants after Lexmark . T he best the Commission could offer was that “ Lexmark does not upset this Court’s body of law taking standing and related threshold concepts originating as requirements for plaintiffs ,” and extending them to “ defendant

- intervenors.” Suppl. Brief for
t he Federal El ection Commission at 6

– 7, Public Citizen v. FEC, No. 14

- 5199 (D.C. Cir. Feb. 10, 2015). Even if it were true that Lexmark changes nothing (which, we think , cannot possibly be the correct answer), we would still need to know how a standard asking whether a plaintiff has a proper cause of action applies to a would

- be defendant, who, self

evidently , is not bringing a new cause of action.

In our view, w ithout a jurisdictional basis, the zone of interests test should no longer apply to intervening defendants. In a motion to intervene under Rule 24, “the question is not whether the applicable law assigns the prospective intervenor a cause of action. Rather, the question is whether the individual may intervene in an already pending cause of action.” Jones v. Prince George’s Cnty., Md

. , 348 F.3d 1014, 1017

– 18 (D.C. Cir. 2003). Indeed, a s Rule 24’s plain text indicates, “ int ervenors of right need only an ‘interest’ in the litigation

— not a ‘cause of action’ or ‘permission to sue.’” Id . at 1018 ( citing F E D

. R. C IV

. P. 24(a)(2)).

Where an intervenor

- defendant establishes Article III standing and meets the dictates of Federal Civil Rule 24, there is no need for another layer of judge

- made prudential13
considerations to deny intervention. Cf. Susan B. Anthony List v. Driehaus , 134 S. Ct. 2334, 2347 (2014) (“To the extent respondents would have us deem petitioners’ claims nonjusticiable on grounds that are prudential, rather than constitutional, that request is in some tension with our recent reaffirmation of th e principle that a federal court’s obligation to hear and decide cases within its jurisdicti on is virtually unflagging.”). Article III standing will already forbid potential intermeddlers with limited intere sts beyond the dispute at issue

, s ee Deutsche Ban k , 717 F.3d at 1 95

– 96 (Silberman, J., concurring) , as will Rule 24, for that matter

, see F ED

. R

. C IV

. P. 24 (a)(2) (an intervenor must claim “ an interest relating to the property or transaction t hat is the subject of the action”). I f a district court has already found the plaintiff stated a valid cause of action, then it is not apparent what the zone of interests test can bring to th e table; because, in any event, the
court must still hear the plaintiff’s claim (albeit with one less party’s input). For these reasons, we think the zone of interests has no applicability to an intervening defendant in a post

- Lexmark world.

IV

. In deciding whether a party may intervene as of right

, we employ a four

- factor test requiring : 1) timeliness o f the application to intervene; 2) a legally protected interest; 3) that the action, as a practical matter, impairs or impedes that interest; and 4) that no party to the action can adequately represent the potential intervenor’s interest. Deutsche Bank

, 71 7 F.3d at 192.

Two of those factors can be dealt with summarily . The Commission has never questioned timeliness, most likely because Crossroads filed an intervention motion before the FEC had even entered an appearance. And since Crossroads14

has constitut ional standing, it a fortiori has “an interest relating to the property or transaction which is the subject of the action.” Fund for Animals , 322 F.3d at 735 (holding the standards for constitutional standing and the second factor of the test for intervent ion as of right are the same); see also Jones v. Prince George’s Cnty

., Md

., 348 F.3d 1014, 1018

– 19 (D.C. Cir. 2003)

.

The third factor also favors Crossroads. An adverse judgment in the district court would impair Crossroads’ defense in a new proceeding because a judicial pronouncement that the FEC’s dismissal was contrary to law would make the “task of reestablishing the status quo . . . [ more ] difficult and burdensome.” Funds for Animals , 322 F.3d at 735

. And should Public Citizen seek a subsequent civil enforcement suit, the district court’s ruling w ould have persuasive weight with a new court. See Roane v. Leonhart

, 74 1 F.3d 147, 151 (D.C. Cir. 2014) ( holding that “a decision rejecting the inmates’ claims could establish unfavorable precedent that would make it more difficult for [intervenor] to succeed on similar claims if he brought them in a separate lawsuit of his o wn”).

The district court denied intervention as of ri ght solely on the fourth factor . It reasoned that the Commission could adequately represent Crossroads’ interests because their interests were aligned in defending the legality of the dismissal order.

To begin with , t he district court never acknowledged that we have described this last requirement for intervention as “not onerous,” Fund for Animals , 322 F.3d at 735, or “low,” id . at 736 n.7, and that a movant “ordinarily should be allowed to intervene unless it is clear that the party will provide adequate representation,” United States v. Am

. Tel. &15

Tel. Co ., 642 F.2d 1285, 1293 (D.C. Cir. 1980)

. Nor did the court acknowledge that we look skepti cally on government entities serving as adequate advocates for private parties

. See Fund for Animals , 322 F.3d at 736; Natural Res. Def. Council v. Costle , 561 F.2d 904, 912

– 13 (D.C. Cir. 1977)

. In addition, by treating general alignment as dispositive, the district court went against the weight of authority in this Circuit. In Fund for Animals

, we reversed a denial of intervention even though the federal agency and prospective intervenor undisput edly agreed that the agency’s current rules and practices were lawful. 322 F.3d at 726. In Costle , we stressed that e ven when the interest of a federal agency and potential interven or can be expected to coincide, “ that does not necessarily mean [ ] adequac y of representation is ensured for purpose of Rule 24(a)(2).” 561 F.2d at 912. The district court thus applied the wrong legal standard to Crossroads’ request for intervention, and a court , by definition

, “ abuses its discretion when it makes an error of la w.” Koon v. United States , 518 U.S. 81, 100 (1996).

I t is apparent the Commission and Crossroads hold different interests, for they disagree about the extent of the Commission’s regulatory power, the scope of the administrative record, and post

- judgme nt strategy. B y arguing there was no sufficient injury for standing purposes, the Commission even disagrees that Crossroads has any cognizable interest in this case. Those disagreements are understandable ; the underlying issues before the district court

ar e the under

- enforcement of federal law and the authority of the FEC

— an agency that could seek to regulate Crossroads directly and immediately after its dismissal order is revok ed. In such circumstances, Crossroads should not need to rely on a doubtful frie nd to represent its interests , when it can represent itself

.16

Crossroads easily met the minimal burden of showing inadequacy of representation and should be allowed to intervene as of right

.

V

. For the foregoing reasons, the district court’s judgment is

Reversed

.