CREW v. FEC (10-1350)

On August 11, 2010, Citizens for Responsibility and Ethics in Washington (“CREW”) filed suit against the Commission for declaratory and injunctive relief in the U.S. District Court for the District of Columbia, challenging as contrary to law the Commission’s dismissal of a complaint that was filed by CREW and CREW Executive Director Melanie Sloan. CREW argues that the Commission’s actions were improper because it did not provide a Statement of Reasons or explanation for its dismissal of the complaint. 5 U.S.C. §706 and 2 U.S.C. §437g(a)(8). CREW further requests declaratory and injunctive relief under the Administrative Procedure Act (APA) and the Federal Election Campaign Act (the Act), challenging as arbitrary, capricious and contrary to law the Commission’s alleged failure to provide Statements of Reasons or any other explanation for the dismissal of some administrative complaints within the 60-day period for filing petitions of review. 5 U.S.C. §706 and 2 U.S.C. §437g(a).

On August 1, 2011, the U.S. District Court for the District of Columbia granted the Commission’s motion to dismiss this case.

Background

CREW is a non-profit corporation “committed to ensuring the integrity of government officials and to protecting the right of citizens to be informed about the activities of government officials.” On March 14, 2007, CREW and Ms. Sloan filed a complaint with the Commission against Peace Through Strength Political Action Committee (“PTS PAC”) for violations of the Act. PTS PAC was the political action committee of Rep. Duncan Hunter, who was then a Presidential candidate. The complaint alleged that PTS PAC had knowingly received contributions exceeding the Act’s individual contribution limit for “testing the waters” activities; that PTS PAC had failed to register as a candidate committee; that it had made an excessive in-kind contribution; and that it had failed to report disbursements for certain television ads.

The Commission found reason to believe that PTS PAC had violated the Act, but determined on June 29, 2010, to take no further action and closed the file in the matter. The court complaint states that, “to date, CREW has not seen either the documents related to this case or the FEC’s Statement of Reasons explaining its dismissal of CREW’s complaint,” and that without such documents, “CREW cannot ascertain the basis for the FEC’s dismissal of CREW’s complaint.”

The complaint alleges that “the FEC refrains from issuing Statements of Reasons explaining the bases for its dismissal within the 60-day period for filing a petition for review under 2 U.S.C. §437g(a)(8) with the intent and/or effect of depriving complainants of their statutory right to judicial review and preventing the U.S. District Court for the District of Columbia from ruling on the issue on which the FEC has not been able to reach consensus.”

Chairman Petersen and Commissioners Hunter, McGahn, Walther and Weintraub issued a Statement of Reasons on August 23, 2010.

Statute and Commission regulations

Under the Act, any person who believes there to have been a violation of the Act may file a sworn complaint with the Commission. Upon receipt of a complaint, the Commission has five days in which to notify the person or persons alleged in the complaint to have violated the Act. 2 U.S.C. §437g(a)(1). Based on the complaint, response and any recommendation of the Commission’s Office of General Counsel, the Commission may then vote on whether there is “reason to believe” a violation of the Act has occurred. If the Commission finds there is “reason to believe” a violation of the Act has occurred, the Commission must notify the respondents of that finding and “make an investigation of such alleged violation.” 2 U.S.C. §437g(a)(2).

After the investigation, the Commission’s General Counsel may recommend that the Commission vote on whether there is “probable cause” to believe that the Act has been violated. 2 U.S.C. §437g(a)(3). If the Commission determines that there is “probable cause,” the Commission must attempt for at least 30 days, but not more than 90 days, to resolve the matter by “informal methods of conference, conciliation and persuasion.” 2 U.S.C. §437g(a)(4)(A)(i). If the Commission is unable to settle the matter through informal methods, it may institute a civil action in the appropriate U.S. District Court. 2 U.S.C. §437g(a)(6)(A).

The Act provides that, if the Commission dismisses a complaint, any “party aggrieved” may seek judicial review of that dismissal in the U.S. District Court for the District of Columbia within 60 days after the date of dismissal. The district court reviewing the Commission’s dismissal of a complaint may declare the Commission’s actions “contrary to law.” 2 U.S.C. §437g(a)(8)(A)-(C).

Complaint

The complaint asks the court to declare that the FEC’s dismissal of CREW’s complaint without providing a Statement of Reasons is contrary to law; to remand the matter to the FEC with an order to conform to the declaration within 30 days; to declare that the FEC’s alleged pattern of failing to provide a Statement of Reasons or other explanation for dismissing complaints within 60 days of such dismissals is arbitrary, capricious and contrary to law; and to order the FEC to issue a Statement of Reasons or other explanation for dismissing complaints “sufficiently within 60 days of such dismissals so as to permit a complainant to file” a petition for review.

District court decision

In its memorandum opinion, the District Court noted that CREW must establish its standing to pursue its claim. The court noted that, while CREW had the right to file an administrative complaint with the FEC, that right did not grant them standing to seek judicial review of the disposition of that complaint.

Thus, the court analyzed whether CREW had standing in the case. In its arguments, the Commission contended that CREW failed to establish standing to appeal the dismissal of MUR 5908 under prongs one and three of the test in Lujan v. Defenders of Wildlife, 504 U.S. 555 (1992). The court noted that under the first prong of the Lujan test, “the plaintiff “must have suffered an ‘injury in fact’ – an invasion of a legally protected interest which is(a) concrete and particularized . . and (b) ‘actual or imminent, not “conjectural” or “hypothetical[.]” The court also noted that under the third prong of the Lujan test, “it must be ‘likely,’ as opposed to merely ‘speculative,’ that the injury will be ‘redressed by a favorable decision.’”

The court’s review of the complaints, the General Counsel’s reports and the FEC’s Statement of Reasons led the court to find that CREW failed to suffer an “informational injury” as the amount spent on travel was publicly disclosed in FEC reports. Since the amended complaint filed by CREW demanded amended FEC filings regarding the previously disclosed expenditures, the court found that the Plaintiffs did not have standing to bring their claim for wrongful dismissal of MUR 5908.

Regarding the claim that the Commission failed to timely notify CREW of its dismissal of the case, the court noted that the Act requires that any court challenge be filed within 60 days of the agency’s dismissal, but it does not contain a timeframe in which a complainant must receive notice of the dismissal. In this case, the Commission voted to dismiss the case on June 29, 2010, notified CREW of its decision to close the file by letter dated July 23, 2010 and sent CREW its Statement of Reasons by letter dated August 24, 2010. Because the agency notified CREW of its decision to dismiss the administrative complaint within the 60-day timeframe, the district court found that CREW did not have standing to bring this claim.

Source:   FEC Record— September 2011; September 2010

District Court (DC) (10-1350)

Court decisions:

• Order (08/01/2011)
• Memorandum Opinion (08/01/2011)

Related documents:

• Defendant FEC's Reply in Support of its Motion to Dismiss Amended Complaint (01/18/2010)
• Plaintiff's Opposition to Defendant's Motion to Dismiss Amended Complaint (12/21/2010)
• Federal Election Commission's Motion to Dismiss Amended Complaint and Memorandum in Support (11/15/2010)
• Plaintiff's Opposition to Defendant's Motion to Dismiss and Proposed Order (10/28/2010)
• Plaintiff's Amended Complaint for Declaratory Judgment and Injunctive Relief (10/28/2010)
• Federal Election Commission's Motion to Dismiss and Memorandum in Support (10/12/2010)
• Errata: FEC Exhibit 1 (10/12/2010)
• Complaint (08/11/2010)