Court Opinion

ID: 5141642
Source: CourtListenerOpinion
Date Created: 2021-12-30 17:01:02.786045+00
Date Added: 2024-06-11T08:24:30.133842
License: Public Domain

UNITED STATES DISTRICT COURT
                             FOR THE DISTRICT OF COLUMBIA

 CAMPAIGN LEGAL CENTER and
 DEMOCRACY 21,

                        Plaintiffs,
                                                     Case No. 20-cv-00730 (CRC)
                        v.

 FEDERAL ELECTION COMMISSION,

                        Defendant,

 RIGHT TO RISE SUPER PAC, INC.,

                        Intervenor-Defendant.

                                      MEMORANDUM OPINION

       Before the Court is intervenor-defendant Right to Rise’s (“RTR”) motion to reconsider

the Court’s February 19, 2021 order granting RTR’s motion to dismiss in part. RTR asks the

Court to revisit its holding that plaintiffs Campaign Legal Center and Democracy 21 have

standing to pursue their claim. Also before the Court is plaintiffs’ motion for a default judgment

against the Federal Election Commission (“FEC”). For the reasons described below, the court

will grant RTR’s motion for reconsideration, and, finding that it lacks subject matter jurisdiction,

dismiss the case and deny plaintiffs’ motion for a default judgment against the FEC.

 I.    Background

           Motion to Dismiss

       In early 2015, Campaign Legal Center and Democracy 21 filed two administrative

complaints with the Federal Election Commission (“FEC”). The groups alleged that during the

2016 presidential election cycle, then-Florida Governor Jeb Bush and the Right to Rise super

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PAC (“RTR”), failed to abide by various disclosure requirements under the Federal Election

Campaign Act (“FECA”). Those complaints sat dormant for nearly five years without action

from the FEC. In March 2020, plaintiffs brought this action, seeking declaratory and injunctive

relief to compel the FEC to act on their complaints. RTR intervened as a defendant and moved

to dismiss.

       On February 19, 2021, the Court granted RTR’s motion to dismiss in part and denied it in

part. See Campaign Legal Ctr. v. Fed. Election Comm’n, 520 F. Supp. 3d 38 (D.D.C. 2021)

(Cooper, J.) (“CLC”). The Court agreed with RTR that plaintiffs failed to state a claim under the

APA. Because FECA provides an “alternative, comprehensive” scheme for judicial review, it

“precludes review of FEC enforcement provisions under the APA.” Id. at 50 (quoting Citizens

for Responsibility and Ethics in Wash. v. FEC, 164 F. Supp. 3d 113, 119–20 (D.D.C. 2015)

(“CREW”) (Cooper, J.)). The Court additionally agreed with RTR that, to the extent plaintiffs

sought a determination from the FEC that certain of RTR and Bush’s expenditures were

“coordinated,” such a request is precluded by Wertheimer v. FEC, 268 F.3d 1070, 1075 (D.C.

Cir. 2001). CLC, 520 F. Supp. 3d at 47.

       However, the Court rejected RTR’s argument that plaintiffs had not alleged an

informational injury sufficient for Article III standing. Id. at 46. The Court reasoned as follows.

The testing-the-waters provisions of FECA “permit would-be candidates to evaluate the

feasibility of candidacy without triggering candidate status when the funds they raise or spend

for that purpose exceed $5,000.” Id. at 43. While potential candidates do not need to disclose

that spending during the testing-the-waters phase preceding their candidacy, if they eventually

become a candidate, FECA requires them to disclose all of those transactions in their campaign

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committee’s first report. Id. 1 If the would-be-candidate decides not to run, though, no disclosure

is required.

        Plaintiffs alleged that Governor Bush was testing the waters of a possible presidential run

as early as January 2015. Id. at 45. But, Bush’s first report as a candidate, filed on July 15,

2015, appeared to only disclose testing-the-waters spending going back to June 5, 2015. This

left the five or so months of testing-the-waters spending between January and June 2015

undisclosed. See PL’s Resp. at 17, ECF No. 13. Taking the plaintiffs’ allegations as true—that

is, that Bush engaged in various testing-the-waters activity as early as January 2015—it appeared

Bush had failed to disclose months of spending that FECA required him to disclose in his

campaign’s first report. 520 F. Supp. 3d at 46. This would constitute an informational injury

sufficient for Article III standing. See id. at 45–46 (citing Campaign Legal Ctr. & Democracy 21

v. FEC, 952 F.3d 352, 356 (D.C. Cir. 2020)).

               Motion for Reconsideration

        On March 5, 2021, RTR moved for reconsideration. RTR argued the Court had

incorrectly applied the legal standard applicable to a motion under Fed. R. Civ. P 12(b)(6) to

RTR’s motion under Rule 12(b)(1). RTR also claimed the Court’s decision was mistaken as to

standing, because “Governor Bush disclosed all his testing-the-waters activities on his

presidential campaign’s first campaign finance report.” Recon. Mot. at 2, ECF No. 19. In

support of that contention, RTR claimed Bush reported “$386,020.15 of testing-the-waters

activity for the period January 2015 through June 2015 in his presidential campaign’s first

        1
         In its earlier ruling, the Court understood this to be plaintiffs’ reading of the statute.
Based on subsequent briefing, the Court now believes Defendant-Intervenor RTR shares this
interpretation. See Reply at 5, ECF No. 22 (arguing that “the Bush campaign and Right to Rise
timely reported the exact information FECA requires” for the period before June 2015); see also
Transcript of Mot. Hearing at 5 (Apr. 20, 2021), ECF No. 27.

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disclosure report,” id. at 8, without citation to the report or any explanation of how that sum was

derived. In the alternative, RTR sought an order certifying the Court’s decision for interlocutory

appeal.

          In response, plaintiffs argued that RTR had “no basis for its assertion that all testing the

waters activity at issue here was publicly disclosed,” because it was not clear how RTR would

know the full scope of the Bush campaign’s testing-the-waters activities. Resp. at 9, ECF No.

21. Plaintiffs maintained that, although Bush “reported some portion of his testing-the-waters

spending,” there is no indication that “this reporting was remotely complete or accurate,” given

the extensive travel and fundraising done by Bush in the months before his candidacy was

announced. Id. at 11.

             Motion for Default Judgement

          Plaintiffs separately filed a motion for default judgment against the FEC on March 26,

2021. Plaintiffs claimed that the FEC “failed to appear, answer, plead, or otherwise defend this

action as required by the Federal Rules of Civil Procedure.” Default Mot. at 1, ECF No. 23.

RTR opposed the motion, arguing that default judgment was not appropriate because (in its

view) the plaintiffs do not have standing and therefore cannot establish subject matter

jurisdiction. Default Resp. at 1, ECF No. 24.

             Motions Hearing

          The Court held a hearing on the reconsideration motion on April 20, 2021. At the

hearing, the Court invited the parties to address what specifically was disclosed in the Bush

campaign’s first report and for what time period. Transcript of Mot. Hearing at 2–3. It was only

then that RTR pointed out—for the first time—that the testing-the-waters spending dated June 5,

2015 in Bush’s first report was listed on that date because that was the date Bush became a

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candidate. Transcript at 6. Under RTR’s legal theory, spending during the earlier testing-the-

waters phase became an in-kind disbursement to the campaign on the date the campaign was

announced, because there was no campaign before then. Id. at 5–6. Counsel also explained that,

underneath the disbursement date there was an earlier date listed, indicating the date that Bush

actually paid the relevant vendor for the testing-the-waters expense. Id. Looking at this second

date, some of this testing-the-waters spending seemed to occur as early as the summer of 2014.

See e.g., Jeb 2016 Inc., 2015 July Quarterly Report, FEC Form 3P at 1675 (filed July 15, 2015;

amended Jan. 31, 2016) (listing, as an example an “In-kind (TTW)” disbursement for

communications consulting in the amount of $1875, with the date of disbursement listed as

06/05/2015 and the notes listing the date 7/11/2014). 2 The total amount of Bush’s testing-the-

waters activity from July 2014 to June 2015 now appeared to be roughly the $386,000 that RTR

had claimed earlier.

        Counsel for the plaintiffs agreed with RTR’s reading of the forms. Transcript at 7.

However, plaintiffs continued to argue that there had to be more than $386,000 worth of testing-

the-waters activity during this time, given the widespread media coverage of Bush’s travel before

his candidacy was announced, and the fact that the reports still only showed a single testing-the-

waters travel disbursement in the amount of $1,089. Id. at 10, 13. RTR responded by asserting

that most of Bush’s travel was done on behalf of RTR and was therefore paid for by RTR and

disclosed in RTR’s quarterly reports, not the campaign’s. Id. at 11–12.

       Because the parties had not, up until that point in the litigation, focused the Court’s

attention on particular instances of Bush’s travel, the Court invited further briefing from the

       2
          Form available at
https://docquery.fec.gov/pdf/887/201507159000159887/201507159000159887.pdf. The Court
may take judicial notice of publicly filed documents of this type.

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parties on the matter. Id. at 23–25. The Court has received that supplemental briefing and the

motions are ripe for the Court’s consideration.

 II.     Legal Standards

            Motion for Reconsideration

         Rule 60(b) authorizes a court to grant relief from an order in certain limited

circumstances—based on “fraud,” “mistake,” or, “any other reason that justifies relief.” Fed. R.

Civ. P. 60(b)(1), 60(b)(6). “It is well-settled that the party seeking relief from a judgment bears

the burden of demonstrating that he satisfies the perquisites for such relief.” Green v. AFL-CIO,

811 F. Supp. 2d 250, 254 (D.D.C. 2011). “Relief under Rule 60(b)(1) motions is rare,” Hall v.

CIA, 437 F.3d 94, 99 (D.C. Cir. 2006), and should only be granted when the movant shows the

Court’s order contains a clear or obvious error, Douglas v. D.C. Hous. Auth., 306 F.R.D. 1, 5

(D.D.C. 2014). Although the moving party must demonstrate that it is entitled to relief under

Rule 60, the court “is vested with a large measure of discretion in deciding whether to grant a

Rule 60(b) motion.” Twelve John Does v. District of Columbia, 841 F.2d 1133, 1138 (D.C. Cir.

1988).

            Standing

         The plaintiff “bears the burden of proving by a preponderance of the evidence that the

Court has subject-matter jurisdiction over her claims.” Schmidt v. U.S. Capitol Police Bd., 826

F. Supp. 2d 59, 69 (D.D.C. 2011) (citing Lujan v. Defenders of Wildlife, 504 U.S. 555, 561

(1992)). To overcome a Rule 12(b)(1) motion, plaintiffs must show “by a preponderance of the

evidence that the Court has subject matter jurisdiction to hear [the] case.” Biton v. Palestinian

Interim Self-Gov’t Auth., 310 F. Supp. 2d 172, 176 (D.D.C. 2004).

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       As this Court has already explained, a plaintiff can establish standing by demonstrating a

denial of access to information “where a statute (on the claimants’ reading) requires that the

information be publicly disclosed and there is no reason to doubt . . . that the information would

help them.” CLC, 520 F. Supp. 3d at 45 (citing Campaign Legal Ctr., 952 F.3d at 356).

 III. Analysis

       The crux of RTR’s argument is that all the information FECA requires to be disclosed

has already been disclosed in some format—either in Bush’s reports or RTR’s own reports. RTR

Supp. Br. at 9, ECF No. 28. Therefore, according to RTR, plaintiffs do not lack access to any

legally-mandated disclosures and have not suffered an informational injury.

       Plaintiffs counter that RTR simply has no basis to know the full extent of Bush’s testing-

the-waters activity, and therefore RTR cannot credibly assert that all of Bush’s pre-candidacy

spending and travel can be accounted for in either Bush’s or RTR’s reports. Pl. Supp. Br. at 2,

ECF No. 29. Plaintiffs further argue that RTR’s reports do not account for all of Bush’s travel or

indicate which spending is associated with a particular instance of travel. Id. at 9–10. In support

of this second argument, plaintiffs point to five instances of Governor Bush’s reported travel that

seem like testing-the-waters activity, yet do not appear to be linked to any recorded travel or

lodging expenditures:

       a. A January 20, 2015 meeting in Washington between Bush and “Republican
          lobbyists.” Pl. Supp. Br. at 4.

       b. Bush’s February 27, 2015 speech at CPAC. Id. at 5.

       c. The March 7, 2015 Iowa agricultural summit. Id.

       d. A March 27, 2015 “Chamber of Commerce breakfast meeting” in Greenville, South
          Carolina. Id.

       e. The May 16, 2015 annual Lincoln Dinner hosted by the Iowa Republican Party. Id.

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       Plaintiffs maintain that Bush’s reported testing-the-waters spending simply does not

account for all of this (and other) pre-candidacy travel. Id. at 6–7. Plaintiffs point to the single

testing-the-waters disbursement for travel and lodging (amounting to only $1,089) listed in

Bush’s report as evidence that the reporting is incomplete. Id. at 7.

       RTR now claims that much of the spending plaintiffs are looking for is reflected in its

FEC reports. RTR originally asserted in earlier rounds of briefing that “Governor Bush

disclosed all of his spending for the purpose of testing-the-waters on his campaign’s first FEC

report,” without citation to any report, or any other documentation that would support this

contention. Reply Br. at 6, ECF No. 15. In its supplemental briefing, however, RTR explains, in

significantly more detail than it did previously, where the spending for each of the instances of

travel that plaintiffs list can be found in RTR’s own reports. 3

       For instance, in connection with the “DC bundler event” on January 20, 2015, RTR

disclosed a $12,159 disbursement related to catering expenses. RTR Supp. Br. at 12. RTR also

listed three disbursements for airfare ($1,065, $2,273, and $2,660, respectively), dated March 6

and 7, 2015. Id. at 14–15. RTR maintains that these records show payment for Bush’s travel to

and from the March 7 event in Iowa. Id. at 15. Similar expenses for lodging and airfare are

listed in RTR’s reports for the March 17 South Carolina breakfast event and the May 16 Iowa

dinner. Id. at 15–16.

       Plaintiffs respond that this reporting is still “demonstrably incomplete” because it reflects

only one $1,089 disbursement for travel over the 13-month period during which Bush was

       3
           In RTR’s view, it sponsored Governor Bush’s participation in these events “because
Right to Rise Leadership PAC was the beneficiary of the activity,” and therefore it was required
to list the expenses on its reports. Supp. Br. at 11–12; see also id. at 17 (“When Governor Bush
attended either Right to Rise or Right to Rise Leadership PAC events, those committees paid for
expenses related to his travel because Bush’s travel and attendance benefitted the committees.”).

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testing the waters, “despite dozens of known trips and events during that time.” Pl. Supp. Br. at

7. After hearing from counsel at the motion hearing and upon review of the supplemental

briefing, however, the Court now agrees with RTR that the spending related to the four campaign

events plaintiffs identified has been fully disclosed.

       As for CPAC, RTR does not claim to have any expenditures related to Governor Bush’s

attendance on February 27, 2015. RTR Supp. Br. at 13. RTR argues that CPAC, and the events

Bush attended there, were sponsored and paid for by other organizations and that Bush’s

attendance at CPAC was not testing-the-waters activity. Id. at 14. In support of this claim, RTR

provides a declaration from Bush’s director of scheduling, attesting that Bush attended an event

at CPAC sponsored by the College Republicans on February 27. RTR Supp. Br. 16, Ex 1. RTR

also cites news sources showing that Bush’s speech at CPAC was at an event hosted, and

presumably paid for, by the American Conservative Union. RTR Supp. Br. 13–14 & n.11–

12. While this does not definitely prove that those groups paid for and disclosed the relevant

CPAC expenses, in the absence of any evidence to the contrary from plaintiffs, it is enough to

defeat their claim to standing.

       Furthermore, plaintiffs are unable to point to other instances of Bush’s pre-candidacy

travel aside from the five events listed above. While it is true that the plaintiffs do not need “to

identify in granular detail each and every campaign expenditure” that is missing, Pl. Supp. Br. at

8, ECF No. 29, plaintiffs must show “by a preponderance of the evidence” that this Court has

standing to hear the case, Biton, 310 F. Supp. 2d at 176. It is not enough for the plaintiff to rest

on “bare legal conclusions [or] unsupported inferences.” Browning v. Clinton, 292 F.3d 235,

242 (D.C. Cir. 2002).

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       The Court is convinced—with the benefit of RTR’s belated explanation of both its and

Jeb 2016’s reports—that the expenses for Bush’s travel and lodging in connection with those five

events have been disclosed. 4 Plaintiffs have not identified any other pre-candidacy events,

travel, or speaking engagements from which the Court could infer the existence of still-

undisclosed spending. Without such allegations, the complaint does not contain more than the

“unsupported inference” that there is more spending to be disclosed. Plaintiffs therefore lack

standing to advance their claim under FECA.

 IV. Default Judgment

       Rule 55 of the Federal Rules of Civil Procedure provides for the entry of a default

judgment where a defendant “has failed to plead or otherwise defend.” Fed. R. Civ. P. 55(a).

When the default judgment sought would be against the United States, its officers, or its

agencies, the claimant must establish “a claim or right to relief by evidence that satisfies the

court.” Fed. R. Civ. P. 55(d).

       RTR argues that plaintiffs cannot establish a right to relief because the Court lacks

jurisdiction to adjudicate their claims. The Court agrees. Because the Court has reconsidered its

prior order and determined that the plaintiffs do not have standing, their default judgment motion

must be denied. See Herbin v. Seau, 317 F. Supp. 3d 568, 571 (D.D.C. 2018); Strong-Fisher v.

LaHood, 611 F. Supp. 2d 49, 52 n.2 (D.D.C. 2009).

       4
         Whether or not this pattern of spending amounts to a violation of FECA’s soft-money
prohibition, as plaintiffs argue, does not alter the standing analysis. As this Court already
decided, plaintiffs are not entitled to a “legal conclusion that carries certain law enforcement
consequences.” CLC, 520 F. Supp. 3d at 47 (quoting Wertheimer, 268 F.3d at 1075).

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 V.    Conclusion

       For the foregoing reasons, the Court will grant RTR’s Motion for Reconsideration.

Having found a lack of standing, the Court will dismiss the case for want of jurisdiction. The

Court will accordingly deny plaintiffs’ motion for a default judgment against the FEC. A

separate Order shall accompany this memorandum opinion.

                                                            CHRISTOPHER R. COOPER
                                                            United States District Judge

Date: December 30, 2021

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