After an intensive investigation, extensive discovery, and lengthy briefing, on August 2nd, Judge Joyce Hens Green of the D.C. federal district court, handed down her long-awaited decision on cross-motions for summary judgment, exonerating the Christian Coalition ("Coalition") on charges made by the Federal Election Commission ("FEC") that the Coalition violated provisions of the Federal Election Campaign Act ("FECA"). See Federal Election Commission v. The Christian Coalition, No. 96-1781 (D.D.C. Aug. 2, 1999).
The case began on July 30, 1996, when the FEC filed suit claiming that the Coalition violated the FECA by making unreported "independent expenditures" in favor of three candidates for federal office and by making unlawful corporate "in-kind contributions" by coordinating the distribution of its voter guides with six other federal candidates. The FEC sought substantial civil penalties for these alleged violations.
What attracted so much attention to this case, apart from the media's scrutiny of the Christian Coalition's activities, were the two novel legal issues presented by this fact-intensive case. The first question presented was whether, in determining if the Coalition made any "independent expenditures," the communication must contain "express advocacy" (which must be limited to "explicit words of advocacy" of election or defeat of a candidate, by use of phrases such as "vote for Smith") as argued by the Coalition, or whether a more subjective inquiry into the "clearly intended effect" of a communication should be made, as argued by the FEC. This issue is one of first impression in the District of Columbia Circuit, where many political and issue advocacy organizations are located,1 and where guidance from the bench has been long in coming.2
The second question presented to Judge Green regarded the contours of the definition of an in-kind contribution. According to the FEC, funds spent by the Coalition to produce voter guides, although not containing "express advocacy," were deemed coordinated with the campaign staff of certain candidates due to extensive consultations with them. Thus, the FEC claimed that otherwise permissible campaign-related materials were turned into illegal in-kind corporate campaign contributions.
BRIGHT LINE "EXPRESS ADVOCACY" TEST ADOPTED
The FEC alleged that the Coalition violated § 441b of the FECA by using general treasury funds to finance "independent expenditures" on three separate occasions. Assuming without deciding that two of the elements for an "independent expenditure" were met (that the communication was independent and that it mentioned a clearly identified candidate), the Court turned to the third element of the test, that is, whether the three expenditures contained "express advocacy."
In arguing that these three communications contained "express advocacy," the FEC pressed for a standard that would measure the speaker's subjective intent, the recipient's understanding, and the context outside the communication itself. The Coalition advocated a bright-line rule of law, which requires "explicit words of advocacy" of election or defeat of a candidate for a communication to contain "express advocacy."3
The Court rejected the FEC's posited approach and instead adopted, consistent with other courts, a narrow "express advocacy" test that focuses solely on the meaning of the words. See Opinion at 30-31 ("First, the communication must in effect contain an explicit directive. . . . That effect is determined first and foremost by the words used. . . . More specifically, the `express advocacy' standard requires focus on the verbs. . . . Second, that verb or its immediate equivalent— considered in the context of the entire communication, including its temporal proximity to the election— must unmistakably exhort the reader/viewer/listener to take electoral action to support the election or defeat of a clearly identified candidate."). While noting that this narrowing construction may render the FECA's regulations on independent expenditures of limited application, the Court concluded that nevertheless, the Supreme Court's decisions in Buckley v. Valeo, 424 U.S. 1 (1976) and FEC v. Massachusetts Citizens for Life, 479 U.S. 238 (1986) mandates this conclusion.
APPLICATION OF THE BRIGHT-LINE "EXPRESS ADVOCACY" TEST
In applying the bright-line test, Judge Green concluded that a speech in Montana made by Dr. Ralph Reed, then Executive Director of the Coalition, ten months before the 1992 general election, did not contain express advocacy of the defeat of Democratic incumbent Congressman Pat Williams. Judge Green found that a very large portion of the speech focused on issues not directly related to the election "by any measure." Opinion at 33. However, while also noting that the speech contained some explicit references to Congressman Williams, Judge Green found that Dr. Reed "carefully avoided such advocacy" even though some of his "verb choices, if phrased a bit differently, may well have crossed into express advocacy." Opinion at 34 ("Here was a typical national pro-family strategy when it came to knocking off somebody like Pat Williams."(emphasis in original)).
The most pointed reference to Congressman Williams was the following statement by Dr. Reed: "[Victory] will be ours here in Montana. And it will be ours all across America. . . . We're going to see Pat Williams sent bags packing back to Montana in November of this year. And I'm going to be here to help you." However, Judge Green, in rejecting the FEC's construction of this quote as an explicit directive to defeat Congressman Williams, found that "[a]lthough the implicit message is unmistakable, in explicit terms this is prophecy rather than advocacy," Opinion at 34, and the message "requires one inferential step too many to be unequivocally considered an explicit directive." Opinion at 35.
The Court also rejected the FEC's second "express advocacy" claim. The factual basis for this claim involved a 1994 mailing titled "Reclaim America" which included a letter from Dr. Pat Robertson and a Coalition scorecard which contained the voting records of incumbent members of Congress. The letter states that "If Christian voters . . . are going to make our voices heard in the elections this November . . . we must stand together, we must get organized, and we must start now." Opinion at 35. The FEC argued that, although the letter referred to no clearly identified candidates, when read in connection with the scorecard, the only understanding is a direction to the reader to support the election of those candidates rated favorably in the scorecard.
The Court disagreed with the FEC's interpretation and found that, "in the context of the entire mailing, which focuses on the importance of raising the profile of issues important to `Christian voters,' a reasonable person could understand Robertson's statement to be a directive to engage in issue advocacy with all candidates in the upcoming election." Opinion at 36. Similar statements in the letter were also found to be understood to be exhorting the reader to lobby incumbents on certain issues. Opinion at 38. In addition, Judge Green found the scorecard resembled that at issue in CLITRIM (which also contained no express advocacy), but was unlike the publication at issue in MCFL (which did contain express advocacy because it identified which candidates were pro-life and then urged the reader to "vote pro-life"). Therefore, while the Court found that "a preference for the Republican incumbents is clearly implied, a reasonable reader would not know whether the Coalition sought the election or defeat of an incumbent who agreed with the Coalition 59 percent of the time on the issues selected without knowing how the opponent rated." Opinion at 36-37.
On its final "express advocacy" claim, the Court found for the FEC. Specifically, the Court held that a mailing by the Georgia Christian Coalition before the 1994 Georgia primary advocated the election of Congressman Newt Gingrich because it "was expressly directed at the reader-as-voter," when the letter stated that "The Primary Elections are here!" and then provided two items "[t]o help you prepare for your trip to the voting booth." Opinion at 38. The clincher in the Court's eyes was the following statement in the letter: "The only incumbent Congressman who has a Primary election is Congressman Newt Gingrich — a Christian Coalition 100 percenter. Make sure that you save this scorecard for November, however, because all other Congressman are opposed in the General Election."
Opinion at 39 (emphasis in Opinion). Therefore, the Court continued, "[t]he unmistakable meaning of the letter is that because Newt Gingrich has voted as the Coalition would have wanted him to on every vote the Coalition considered significant, the reader should vote for him in the primary election." Opinion at 39.
IN-KIND CONTRIBUTION ALLEGATIONS
The second issue was whether the Coalition made illegal corporate "in-kind contributions" to certain federal candidates by allegedly "coordinating" the distribution of the Coalition's voter guides with these candidates. Specifically, the FEC claimed coordinated expenditures occurred with the NRSC in 1990, the 1990 Helms for Senate campaign, the Bush-Quayle `92 campaign, the 1992 Inglis for Congress campaign, the 1994 Hayworth for Congress campaign, and the 1994 North for Senate campaign.
Finding that Buckley left unresolved First Amendment concerns that arise with respect to "expressive coordinated expenditures" (as opposed to direct monetary contributions), the Court decided that the Coalition's case provided the precise case in which to grapple with the issue. In resolving the issue, the Court fashioned a narrow definition of coordination that requires negotiation or give-and-take between the parties. "Substantial discussion or negotiation" over a communication's contents, timing, location, mode, or intended audience, or volume is required. Opinion at 101. "Substantial discussion or negotiation is such that the candidate and spender emerge as partners or joint venturers in the expressive expenditure," although they "need not be equal partners." Opinion at 101. "This standard limits § 441b's contribution prohibition on expressive coordinated expenditures to those in which the candidate has taken a sufficient interest to demonstrate that the expenditure is perceived as valuable for meeting the campaign's needs or wants." Opinion at 101. Mere knowledge of campaign strategy or an organization's plans to distribute a specified amount of voter guides is not enough, but "considerable coordination will convert an expressive expenditure into a contribution." Opinion at 99.
In determining how much coordination is required by the First Amendment to be proven, the Court rejected standards posited by both the FEC and the Coalition. Specifically, the Court rejected a "but-for" test as too narrow, which would have examined whether the corporation or union would have made the expenditure but for the intercession of the candidate or his staff. Opinion at 94. The Court also refused to adopt the FEC's overbroad "insider trading" or conspiracy standard which would cause any consultation, including issue discussion, between a potential spender and a federal candidate's campaign about plans, projects, or needs, to render any subsequent expenditures made for the purpose of influencing the election coordinated expenditures. Opinion at 94.
Although adopting a narrow view of coordination, the Court nonetheless refused to limit coordinated expenditures to only those communications that contain express advocacy. Finding the argument made by the Coalition and amici unpersuasive, the Court found that neither the FECA nor the First Amendment requires a limiting construction on § 441b's prohibition on corporate contributions or expenditures in connection with federal election so that it only applied to communications that contain "express advocacy." See Opinion at 89-94. In dismissing the argument, the Court reasoned that if an individual can be criminally convicted for making an illegal in-kind contribution by expending a sum in excess of the contribution limit without the expenditure expressly advocating the election or defeat of a clearly identified candidate, then a corporation should also be civilly liable for making an illegal in-kind contribution even though the communication does not contain "express advocacy." See Opinion at 91 (citing United States v. Goland, 959 F.2d 1449, 1452 (9th Cir. 1992)). Providing another basis for rejecting the Coalition's argument, the Court found that importing the "express advocacy" standard into § 441b's contribution prohibition "would misread Buckley and collapse the distinction between contributions and independent expenditures in such a way as to give short shrift to the government's compelling interest in preventing real and perceived corruption. . . . Were this standard adopted, it would open the door to unrestricted corporate or union underwriting of numerous campaign-related communications that do not expressly advocate a candidate's election or defeat." Opinion at 92.
Perhaps the most disappointing aspect of the Court's refusal to adopt the bright-line standard express advocacy rule for in-kind contributions is that issue advocacy organizations and labor unions remain chilled in their exercise of First Amendment rights. Intrusive investigations are still possible because of the "necessarily fact-intensive inquiry allowing for extensive FEC inquiry into the nature and extent of communications between the alleged contributor and campaign" that is required in the absence of a bright-line rule. Opinion at 93.
APPLICATION OF THE NARROW COORDINATION STANDARD
In applying this legal analysis, the Court found that the Coalition did not make any in-kind contributions in five of the races alleged and found that a trial is necessary to resolve the last one. The most significant claim, coordination with Bush-Quayle '92, involved extensive discovery (including a search of unarchived presidential and campaign documents in boxes at the National Archives) and depositions of numerous people associated with both the Coalition and Bush-Quayle `92, including depositions of both former President Bush and former Vice President Quayle. The FEC conducted a wide-ranging investigation of the relationships among Coalition officers and employees and those on the national and state Bush-Quayle campaign staffs, going back so far as the beginning of President Bush's and Dr. Robertson's friendship when their fathers were Senators. The FEC offered as evidence in support of their position every contact, meeting, and appearance that took place from 1990 through 1992 between Coalition officers and President Bush, Vice President Quayle, White House officials, and Bush-Quayle campaign staff. Not left out were the hundreds of phone calls from the Coalition to the White House and Bush-Quayle `92 campaign headquarters.
Despite these frequent contacts between the Coalition and its individual officers and the White House and campaign, the Court found a lack of coordination. Of particular importance was the fact that Bush-Quayle campaign staff did not initiate a discussion or negotiation in response to the Coalition's sharing of information regarding its plans to publish 40 million voter guide in 1992. See Opinion at 107.
Another important aspect of the Court's opinion regarding Bush-Quayle is its finding that coordination cannot be inferred "merely from a corporation's possession of insider knowledge from a federal candidate's campaign. Some more overt acts of coordination are required." Opinion at 108. The Court found that overt acts did not occur.
The FEC's main argument regarding its Helms for Senate claim was that Dr. Reed was privy to Senator Helms' private opinion polls and used this knowledge to target voter guides in North Carolina. Finding the FEC's evidence weakest on this claim, the Court found "no evidence or allegation that the Helms campaign requested or suggested that the Coalition distribute voter guides or make [Get Out The Vote] calls nor did the campaign discuss the content, timing, location or volume of the voter guides with the Coalition." Opinion at 109.
The Court also found the FEC's evidence in support of its Inglis claim to be built upon its insider trading or conspiracy theory. A Coalition official's knowledge about the Inglis campaign gained in his volunteer capacity did not demonstrate a link between that knowledge and any discussion or negotiation of the expenditures on voter guides. Thus, the FEC did not show "that the Inglis campaign became a partner in the Coalition's voter guide expenditures." Opinion at 110.
Regarding its Hayworth claim, the FEC again used its insider trading or conspiracy theory, arguing that because a Coalition state official was both a Coalition officer and a campaign insider, it must be inferred that he coordinated the voter guide distribution with himself. The Court found that engaging in veil-piercing of this sort would burden associational rights in this case where the Coalition officer lacked a more complete decisionmaking authority for both the Coalition and the campaign and the evidence did not indicate that decisions to make expressive expenditures were taken to assist the campaign. Opinion at 112-13.
As for its NRSC claim, the FEC argued that a $64,000 donation by the NRSC to the Coalition, which was spent on voter guides, resulted in an illegal contribution. Judge Green rejected this claim, finding that because the NRSC could legally independently spend unlimited amounts in support of its candidates, a "service" from the Coalition (converting its funds into voter guides) to the NRSC would have to be found. Opinion at 113. However, the facts did not demonstrate that the Coalition provided the NRSC with a service in the form of an anonymity premium. Opinion at 114.
The Court found, however, that the evidence of coordination with the Oliver North campaign was in dispute, requiring a trial to resolve. Opinion at 110. With one possible exception, like the other campaigns discussed above, the FEC could not show that discussions between campaign officials and Coalition officers touched on the Coalition's voter guide plans. There was conflicting testimony, however, regarding whether discussions occurred about what issues should appear on the voter guide. Also left for trial is the fair market value of a list of delegates to the Republican state convention in Virginia, given by the Coalition to a North campaign consultant, which the judge found to result in an unlawful in-kind contribution to the North campaign.
Overall, the Court's decision was a major victory for the Christian Coalition, which had been pursued relentlessly by the FEC since 1992. However, the spoils from the victory are not the Coalition's alone. All corporations and labor unions can rest a little more securely within the District of Columbia, knowing that a bright-line express advocacy test governs their communications, and that a narrow definition of coordination applies to determine whether coordinated expenditures become illegal in-kind contributions. However, corporations and labor unions must still sleep with one eye open until the court eliminates the chill still present from its refusal to adopt the express advocacy test for in-kind contributions.
* Mr. Bopp and Ms. Meyer, of the Terre Haute, Indiana, law firm of Bopp, Coleson & Bostrom, were lead counsel for The Christian Coalition. Mr. Bopp is also Of Counsel to the Washington, D.C. law firm of Webster, Chamberlain & Bean and serves as the Chairman of the Election Law Subcommittee of the Free Speech and Election Law Practice Group of the Federalist Society.
- The filing of an amici curiae brief in support of the Coalition's position by the AFL-CIO and the ACLU demonstrates the wide implication and importance of this case.
- This issue, while one of first impression in the D.C. Circuit, has been addressed by other Circuits, which have adopted the "explicit words of advocacy" test for "express advocacy." See Iowa Right to Life Comm., Inc. v. Williams, 1999 WL 607886 (8th Cir. 1999); North Carolina Right to Life, Inc. v. Bartlett, 168 F.3d 705 (4th Cir. 1999); Virginia Soc'y for Human Life, Inc. v. Caldwell, 152 F.3d 268 (4th Cir. 1998); Brownsburg Area Patrons Affecting Change v. Baldwin, 137 F.3d 503 (7th Cir. 1998): FEC v. Christian Action Network, Inc., 110 F.3d 1049 (4th Cir. 1997)(CAN II); FEC v. Christian Action Network, Inc., 894 F. Supp. 946 (W.D. Va. 1995), aff'd per curiam, 98 F.3d 1178 (4th Cir. 1996)(CAN I); Maine Right to Life Comm., Inc. v. FEC, 914 F. Supp. 8 (D. Me. 1996), aff'd per curiam, 98 F.3d 1 (1st Cir. 1996)("[W]e affirm for substantially the reasons set forth in the district court opinion."); Faucher v. FEC, 928 F.2d 468 (1st Cir. 1991); FEC v. Central Long Island Tax Reform Immediately Comm., 616 F.2d 45 (2d Cir. 1980)(en banc); Kansans for Life, Inc. v. Gaede, 38 F. Supp.2d 928 (D. Kan. 1999); Florida Right to Life, Inc. v. Mortham, No. 98-770-CIV-ORL-19A (M.D. Fla. Sept. 29, 1998)(Order clarified Oct. 16, 1998); Right to Life of Mich., Inc. v. Miller, 23 F. Supp.2d 766 (W.D.Mich. 1998); Planned Parenthood Affiliates of Mich., Inc. v. Miller, 21 F. Supp.2d 740 (E.D. Mich. 1998); Right to Life of Dutchess County, Inc. v. FEC, 6 F. Supp.2d 248 (S.D.N.Y. 1998); Clifton v. FEC, 927 F. Supp. 493 (D. Me. 1996), aff'd on other grounds, 114 F.3d 1309 (1st Cir. 1997); FEC v. Christian Action Network, 894 F. Supp. 946 (W.D. Va. 1995), aff'd per curiam, 92 F.3d 1178 (4th Cir. 1996); FEC v. Survival Educ. Fund, Inc., 1994 WL 9658 (S.D.N.Y. Jan. 12, 1994), aff'd in part and rev'd in part on other grounds, 65 F.3d 285 (2d Cir. 1995); FEC v. Colorado Republican Fed. Campaign Comm., 839 F. Supp. 1448 (D. Colo. 1993), rev'd, 59 F.3d 1015 (10th Cir. 1995), vacated and remanded on other grounds, 116 S. Ct. 2309 (1996); West Virginians for Life, Inc. v. Smith, 919 F. Supp. 954 (S.D.W.Va. 1996); FEC v. NOW, 713 F. Supp. 428 (1989); FEC v. AFSCME, 471 F. Supp. 315, 317 (D.D.C. 1979); but cf. FEC v. Furgatch, 807 F.2d 857 (9th Cir. 1987).
- "Reformers" derisively call this a "magic words" test, as if the Coalition was arguing that only the specific words, such as those listed in Buckley's footnote 52 qualify. In so doing, the "reformers" set up a strawman, which was easily knocked down by the Judge's rejection of a "magic words" test. However, the Coalition was not advocating a "magic words" test but rather an "explicit words of advocacy" test, which focuses on the meaning of the words used, instead of the subjective intent of the speaker or effect on the listener as advocated by the "reformers."