First, some background from Find Law:
“The challenge grew out of FEC rules promulgated under the Bipartisan Campaign Reform Act (BCRA), also known as the McCain-Feingold Act.
“The BCRA requires that every person who ‘makes a disbursement’ for the costs to produce and air more than $10,000 of “electioneering communications” file certain disclosures with the FEC. The challenged rule, 11 C.F.R. § 104.20(c)(9), states if the disbursements were made by a corporation or labor organization, the disburser must disclose the name and address of each person who donated $1,000 or more to the corporation or labor organization for the purpose of furthering electioneering communications in a calendar year.
“Rep. Chris Van Hollen argued that the rule violated the BCRA, which plainly requires every ‘person’ who funds ‘electioneering communications’ to disclose ‘all contributors.’ Van Hollen claimed that there were no terms limiting that requirement to the names of those who transmitted funds accompanied by an express statement that the contribution was intended for the purpose of funding electioneering contributions.”
“A district judge agreed with Van Hollen in March, concluding the McCain-Feingold Act ‘spoke plainly’ in preventing the agency from limiting the disclosure requirement.
“Tuesday, the D.C. Circuit reversed that ruling, finding that the BCRA language wasn’t so plain after all. The appellate court concluded, “The statute is anything but clear, especially when viewed in the light of the Supreme Court’s decisions in Citizens United v. FEC and FEC v. Wis. Right to Life, Inc.”
ElectionLawBlog provides the opinion:
“The Court now concludes that the promulgation of 11 C.F.R. § 104.20(c)(9) was
arbitrary, capricious, and contrary to law and that the regulation is an unreasonable interpretation
of the BCRA for several reasons. First, the Commission initiated the rulemaking process for the
stated purpose of responding to the decision in WRTL II, but nothing the Supreme Court did in
that case provides a basis for narrowing the disclosure rules enacted by Congress. WRTL II dealt
solely with the question of whether the statutory ban on corporate and labor organization funding
of electioneering communications could withstand an as-applied constitutional challenge. And
in answering that question, the Court did not find any need to address the BCRA’s disclosure
“Second, there is little or nothing in the administrative record that would support the
Commission’s decision to introduce a limitation into the broad disclosure rules in the BCRA.
Neither the petition for rulemaking nor the original notice of proposed rulemaking proposed
altering the disclosure requirements for corporations and labor unions. None of the commenters
asked the agency to amend the disclosure rules to include a purpose requirement, and the
Commission did not incorporate the purpose requirement in the new rule until after the notice
and comment period and the hearing had been concluded. The only post-hearing comment
received in response to the newly incorporated language strongly opposed its inclusion.
“Finally, the regulation’s purpose requirement is inconsistent with the statutory language
and purpose of the BCRA. Congress passed the disclosure provisions of the BCRA to promote
transparency and to ensure that members of the public would be aware of who was trying to
influence their votes just before an election. The added purpose requirement in section
104.20(c)(9) thwarts that objective by creating an easily exploited loophole that allows the true
sponsors of advertisements to hide behind dubious and misleading names. Based on these
considerations, the Court will vacate 11 C.F.R. § 104.20(c)(9), and it will grant plaintiff’s motion
for summary judgment.”
Note: I removed some numbers for clarity