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September 1,
2010
FEC Adopts
Revised Coordinated Communications Regulations with Broadened Conduct
Prong; Also Approves Stricter Rule Defining Federal Election Activity
The Federal Election Commission ("FEC")
approved revised regulations on August 26, 2010 that will have a
major impact on the ways in which individuals, corporations, labor
unions, and independent political groups may go about funding
political advertisements in the upcoming midterm elections and
beyond. The revised regulations, addressing "coordinated
communications," stem from a decision of the U.S. Court of
Appeals for the District of Columbia Circuit in Shays v. FEC ("Shays III"), where the
court of appeals requested clarification or struck down several
portions of the FEC's coordination regulations implementing the
Bipartisan Campaign Reform Act of 2002 ("BCRA"). The
amended regulations also address and borrow language from the U.S.
Supreme Court's decisions in FEC
v. Wisconsin Right to Life, Inc. ("WRTL") and Citizens United v. FEC ("Citizens United").
The revised coordination rule specifically addresses
independent and outside spending on political advertising, and what
sort of subject matter and activity constitutes coordination with a
federal candidate's campaign committee that would trigger FEC
regulation. Since 2002, the FEC has applied a three-prong test
to determine whether a communication, i.e. an independent expenditure
or independent political advertising on federal elections, is a
coordinated communication, and therefore subject to the FEC's
contribution and expenditure limitations and prohibitions. If a
communication satisfies all three prongs: (1) payment; (2) content;
and, (3) conduct, it is deemed a coordinated communication, and
subject to FEC coordination regulations. The content prong of
this test has been the subject of the most controversy and litigation
since its adoption in 2002, and is the primary focus of the current
changes. Proposed changes to the conduct prong were also up for
debate in this rulemaking, but remain unchanged.
The Court of Appeals in Shays III stated that the FEC's 2006 revisions to
the content prong of the coordination regulation, namely its decision
to apply "express advocacy" as the only content standard
for communications outside 120 days before a state's Presidential
primary through the general election, and 90 days before a primary
and general congressional election, ran "counter to BCRA's
purpose." The court was concerned that by applying the
express advocacy test outside the 90/120 day time windows, a test
focused solely on communications containing so-called "magic
words," such as "vote for," "elect,"
"support," "defeat," and "reject," it
would allow candidates, individuals, and independent groups to
circumvent the contribution and expenditure limitations and
prohibitions of BCRA. Accordingly, the Shays III court directed the
FEC to craft a content standard that is more inclusive than
"express advocacy" to apply to communications outside the
90/120 day time frames.
In response to the Shays
III court's directive, the FEC has added an additional
standard to the content prong of the coordination test. The new
standard applies to any public communication that is the
"functional equivalent of express advocacy," i.e., a
communication "susceptible of no reasonable interpretation other
than as an appeal to vote for or against a clearly identified Federal
candidate." Such language is borrowed directly from the
test employed and articulated by Chief Justice Roberts in the Supreme
Court's WRTL opinion
and applied most recently in the Supreme Court's Citizens United
decision. The standard is a broader interpretation than the
strict "express advocacy" test, and applies to
communications at all times before a federal primary or general election,
whether they be inside or outside the 90/120 day windows.
The FEC explicitly rejected adopting a content standard
to cover public communications that promote, support, attack, or
oppose a political party or a clearly identified Federal candidate,
referred to as the "PASO standard." Campaign finance
reform advocates had pushed vigorously for adoption of the PASO
standard during the FEC's open comment and hearing period, but this
proposal did not garner the necessary support of four Commissioners.
"Functional Equivalent of Express
Advocacy" Content Standard in Practice
Although the FEC's revised coordination rule broadens
the scope of the content of independent communications that may
constitute coordination, and therefore trigger FEC regulation, it
avoids bright-line guidance or examples of what sort of
communications actually satisfy the test. Instead, it cites
only the Supreme Court's decisions in WRTL and Citizens
United, and the Court's objective application of the
"functional equivalent" test to the specific communications
in each case-WRTL's
television and radio ads urging voters to contact their senators,
which the Court concluded were not the "functional equivalent of
express advocacy," and Citizens
United's production and dissemination of Hillary, The
Movie, which the Court determined was "equivalent to express
advocacy."
Because the FEC has limited its guidance to the few
examples addressed in these Supreme Court decisions, it remains to be
seen what sort of communications will or will not satisfy the new
"functional equivalent" content standard for coordinated
communications. Consequently, individuals, corporations, labor
unions and independent groups seeking to exercise their First
Amendment rights this fall and beyond by funding independent
expenditures should do so prudently, and after consulting counsel
familiar with the applicable FEC regulations and case law.
FEC Approves New Definition of Federal Election
Activity by 6-0 Vote
At the same August 26, 2010 meeting, the FEC approved by
a 6-0 vote a stricter definition of Federal Election Activity
("FEA") than in its previous FEA regulation. These
new rules are effective on December 1, 2010. FEA is state and
local political party campaign activity that requires the use of
Federal funds (so-called "hard money") within the FEC's
limitations and prohibitions. The revised rule stems from
the Court of Appeals for the District of Columbia Circuit's decision
in Shays III, where
the court of appeals remanded the previous definitions of "voter
registration activity" and "GOTV activity" (Get Out
the Vote Activity), back to the FEC for revision and clarification
because of alleged loopholes enabling potential circumvention of the
FEA requirements of BCRA.
The FEC's revised rule requires that state and local
political parties use
"hard money" to pay for "voter
registration activity" and "GOTV activity" aimed at
urging, encouraging, or assisting potential voters to register to
vote or to vote, "regardless of whether the message is delivered
individually or to a group of people via mass
communication." The new FEA rule is stricter than the
previous rule in that the former regulations covered only
registration and GOTV activity aimed at individual potential voters.
The new rule means that state and local political parties' mass voter
registration drives or communications must now be paid for with
solely "hard money."
For further information regarding the topics discussed
in this update, please contact your Clark Hill political law
attorney.
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The Washington Capitol Dome was constructed between
1855 and 1866, more than 50 years after the first Congress was held
in the building. Designed by Thomas U. Walter, the fourth architect
of the Capitol, the current (second) dome was built to better suit
the Capitol building which had been expanded due to the growth of the
United States and the size of the United States Congress.
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About Clark Hill
Clark Hill PLC is a full service law firm that provides business legal
services, government & public affairs, and personal legal services to
our clients throughout the country. With offices in Arizona, Illinois,
Michigan and Washington, DC, Clark Hill has more than 200 attorneys and
professionals.
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For more information
on Clark Hill PLC,
please visit clarkhill.com or call 800.949.3124
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