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17 2 The second relevant category of non-profits consists of those that only make contributions to federal candidates or political parties and make no expenditures. Given the constitutionally permissible caps on an individual donor’s contributions to candidates or parties, the Supreme Court has acknowledged the risk that individuals might use non-profits to evade those limits. In order to prevent circumvention of limits on an individual donor’s contributions to candidates and parties, the Court has held that non-profit entities can be required to make their own contributions to candidates and parties, as well as pay associated administrative expenses, out of a hard-money account that is subject to source and amount restrictions. See Cal-Med, 453 U.S. at 198-99 (opinion of Marshall, J.); id. at 203-04 (opinion of Blackmun, J.). As a majority of the Court pointed out in Cal-Med, doing so prevents non-profits from being used as “conduits” for illegal contributions to parties and candidates and thus prevents “evasion of the limitations on contributions” to a candidate. Id. at 203 (opinion of Blackmun, J.); see also id. at 198 (opinion of Marshall, J.) (limit on donations to non-profit prevents evasion of “$1,000 limit on contributions to candidates . . . by channeling funds” through the non-profit); Cal. Med. Ass’n v. FEC, 641 F.2d 619, 625 (9th Cir. 1980) (Kennedy, J.) (non-profit committee is “natural conduit for candidate contributions and . . . the essential purpose of the provision here in question is to limit those contributions, not to limit expenditures for any other type of political advocacy”) (emphasis added).10 10 The requirement that certain administrative expenses be funded in part with hard money prevents a contributor from essentially taking control of a non-profit and thereby circumventing limits on individual contributions to candidates. See Cal-Med, 453 U.S. at 198-99 n.19 (opinion of Marshall, J.); id. at 203 (opinion of

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Emily's List v. FEC

Judgment

Question Presented: Whether the FEC's regulations requiring non-profit political committees to use federally regulated ("hard money") funds for at least 50% of their administrative, voter drive, and public communications costs—and restricting how such groups may solicit contributions—violate the First Amendment's protection of political speech and association, particularly in light of the Supreme Court's intervening decisions in FEC v. Wisconsin Right to Life (2007) and Davis v. FEC (2008).

Alleged Acts: EMILY's List is a political committee—specifically, a non-profit organization that raises funds to support pro-choice Democratic women candidates for federal office. Following the enactment of the Bipartisan Campaign Reform Act of 2002 (BCRA), the Federal Election Commission (FEC) promulgated new regulations governing how non-profit political organizations allocate funds between "federal" (regulated) and "nonfederal" (unregulated) accounts. The challenged FEC regulations imposed three rules. First, the allocation rule required political committees that make both federal and nonfederal expenditures to pay for their administrative, generic voter drive, and public communications costs using a mix of federal ("hard money") and nonfederal ("soft money") funds, with at least 50% of the funds coming from the capped federal account. Second, the solicitation rule restricted how non-profit groups could solicit contributions, limiting solicitations to the amounts permitted under federal contribution limits. Third, the "sham" nonfederal account rule treated certain nonfederal accounts as effectively federal accounts if they were used for election-related activities (such as advertisements, voter registration drives, and get-out-the-vote efforts), subjecting them to federal contribution limits. EMILY's List challenged these regulations, arguing that they violated the First Amendment by restricting its ability to raise and spend unlimited funds for election-related speech and activities.

Procedural history: EMILY's List moved for a preliminary injunction. The district court denied the motion, finding EMILY's List failed to show a substantial likelihood of success on the merits or irreparable harm. EMILY's List appealed the denial of the preliminary injunction. The D.C. Circuit affirmed, applying the precedent of McConnell v. FEC, 540 U.S. 93 (2003), which had upheld BCRA's soft-money restrictions. After the Supreme Court decided FEC v. Wisconsin Right to Life, Inc. (2007) and Davis v. FEC (2008), the district court granted summary judgment to the FEC on all of EMILY's List's claims, upholding the regulations.

Summary: EMILY's List v. FEC is a significant campaign finance decision in which the D.C. Circuit (sitting en banc) struck down FEC regulations that required non-profit political organizations to allocate at least 50% of their administrative and election-related spending from federally regulated "hard money" accounts and restricted their solicitation methods. The court held that these regulations functioned as unconstitutional expenditure restrictions under the First Amendment because they limited independent political speech by non-party organizations—a category of spending the Supreme Court had repeatedly held is not tainted by quid pro quo corruption and therefore may not be restricted. The decision also found that the FEC exceeded its statutory authority under FECA by presumptively treating all election-related spending by non-profits as federally regulated. The ruling was an important precursor to Citizens United v. FEC (2010), which would later extend similar First Amendment protections to corporate independent expenditures.

Conclusion: In an en banc decision, the D.C. Circuit reversed the district court and struck down the challenged FEC regulations as violations of the First Amendment. The court held that the FEC's allocation and solicitation regulations operated as expenditure restrictions, not contribution limits, and therefore required strict scrutiny rather than the deferential standard applied to contribution limits under Buckley. The government's interest in preventing corruption or the appearance of corruption could not justify the regulations because the regulations applied to non-party, independent organizations—not to political parties or candidates. Independent spending by non-profit groups, as established by Buckley and Wisconsin Right to Life, does not give rise to quid pro quo corruption.

Legal Issue(s)

Campaign Finance

Applicable Law(s): First Amendment of the United States Constitution, Federal Election Campaign Act, and Bipartisan Campaign Reform Act

Region: Americas

Country: United States of America

Language of Decision

English

Court: Appellate Court

Election Type: General

Date of decision: Sep 18, 2009

Geolocation

Latitude: 37.7398

Longitude: 66.7489

: Geolocation

Link: https://campaignlegal.org/sites/default/files/2039.pdf

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Emily's List v. FEC.pdf
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Election Judgments - IFES

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Emily's List v. FEC

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