Opinion ID: 187188
Heading Depth: 1
Heading Rank: 4

Heading: Conduct Standard: Campaign Vendors and Former Employees

Text: BCRA directed the FEC, in issuing its revised coordinated communication rules, to address payments for the use of a common vendor and payments for communications directed or made by persons who previously served as an employee of a candidate or a political party. BCRA § 214(c), 116 Stat. at 95 (codified at 2 U.S.C. § 441a note). The FEC's original post-BCRA regulations implemented these provisions by specifying that the conduct prong of the coordinated communication test would be satisfied if a candidate's vendor or former employee create[d], produce[d], or distribute[d] a communication using material information about campaign plans, projects, activities, or needs, or shared such information with the person paying for the communication, throughout the current election cycle. 11 C.F.R. § 109.21(d)(4)-(5) (2003). Shays chose not to challenge these original provisions, but the FEC nonetheless revisited them after we remanded other aspects of the coordinated communication rule in Shays II. Because campaign vendors and employees complained that the regulation was unnecessarily cumbersomethey claimed that the information they possess quickly loses valuethe FEC decided to change the rule so that it only prohibits vendors and former employees from using material information about campaign plans, projects, activities, or needs, or sharing such information with the person funding the ad, for 120 days, rather than throughout the whole election cycle. 11 C.F.R. § 109.21(d)(4)-(5). In the district court, Shays challenged the revised regulation, arguing that it ran counter to BCRA's purpose and violated the APA. Although the district court rejected the Chevron step two argument, it found the revised regulation arbitrary and capricious because the FEC had failed to justify its policy change. Shays III, 508 F.Supp.2d at 49-52. We agree. Explaining the new rule, the FEC reasoned that [r]educing the temporal limit to 120 days will not undermine the effectiveness of the conduct standards and will not lead to circumvention of the Act because material information regarding candidate and political party committee campaigns, strategy, plans, needs, and activities. . . does not remain `material' for long periods of time during an election cycle. 71 Fed.Reg. at 33,204. The Commission went on to say that a limit of 120 days is more than sufficient to reduce the risk of circumvention of the Act. Id. at 33,205. We see two flaws in this rationale. First, as the district court pointed out, the Commission's generalization that material information does not remain material for long overlooks the possibility that some informationfor instance, a detailed state-by-state master plan prepared by a chief strategistmay very well remain material for at least the duration of a campaign. Shays III, 508 F.Supp.2d at 51. Indeed, the Commission's own regulations recognize that some types of information retain value for longer than 120 days. For example, the Commission says that polling dataarguably the campaign information that most quickly becomes obsoleteretains some value for 180 days. See 11 C.F.R. § 106.4(g). Yet the Commission inexplicably asserts that other types of campaign informationincluding some far more durable information such as donor lists and lists of supportive voterswill have lost value within 120 days. As Shays points out, under the FEC's regulation, a top presidential campaign staffer could leave a campaign after an early primary, wait 120 days, and then spend the entire general election working for an outside group on behalf of his former candidate, using that candidate's donor lists, mailing lists, and long-term strategic plan. The Commission never explains why this type of coordination should go unregulated. Second, the FEC has provided no explanation for why it believes 120 days is a sufficient time period to prevent circumvention of the Act. Though the Commission certainly has some discretion in choosing exactly where to draw a bright line such as this one, it must support its decision with reasoning and evidence, for a bright line can be drawn in the wrong place. Shays II, 414 F.3d at 101.