Opinion

Shays v. Federal Election Commission

337 F. Supp. 2d 28
2004 U.S. Dist. LEXIS 18694
2004 WL 2097498

Court: District Court, District of Columbia
Filed: Sep 18, 2004
Status: Published
Author: Kollar-Kotelly
On the bench: Kollar-Kotelly
Cited by: 16 cases
Authority: More cited than 75.4%

holding that the FEC violated the APA’s notice requirements in promulgating these definitions because interested parties could not reasonably have anticipated the final rule-makings from the notice of proposed rule-making

How later courts described this case

holding that the FEC violated the APA’s notice requirements in promulgating these definitions because interested parties could not reasonably have anticipated the final rule-makings from the notice of proposed rule-making
rejecting Mourning deference because the defendant agency "provides no citation to a case that suggests that a regulation may be salvaged if it is 'reasonably related to the purposes of the enabling statute’ even if it fails Chevron step one”
finding fault with the FEC’s failure to consider potential problems that might emerge by effectively del egating the enforcement of election law to the IRS
reviewing the FEC’s regulations under the Administrative Procedure Act in a single-judge court

Written by the judges who cited it.

The opinion

MEMORANDUM OPINION

KOLLAR-KOTELLY, District Judge.

On October 8, 2002, Christopher Shays (“Shays”) and Martin Meehan (“Meehan”) (collectively “Plaintiffs”), both members of the United States House of Representatives, filed the above-captioned action against the Federal Election Commission (“FEC” or “Commission” or “Defendant”).

Through their Complaint, Plaintiffs challenge the FEC’s regulations implementing Titles I and II of the Bipartisan Campaign Reform Act (“BCRA”). Plaintiffs contend that “[t]he FEC’s new regulations, in multiple and interrelated ways, thwart and undermine the language and congressional purposes of Titles I and II of BCRA.” Am. Compl. ¶ 6.

At the same time this case was filed,

McConnell v. Federal Election Commission

and ten related actions challenging the constitutionality of BCRA were pending before a three-judge panel of this District Court. The three-judge panel issued

*36

its decision on May 1, 2003,

see McConnell v. Federal Election Commission,

251 F.Supp.2d 176 (D.D.C.2003), and the case was immediately appealed to the United States Supreme Court. On September 29, 2003, in response to motions by the two sides in this current case advocating different methods of proceeding, the Court stayed proceedings in this case pending the Supreme Court’s decision in

McConnell v. Federal Election Commission.

The Supreme Court issued its decision on December 10, 2003, upholding almost all of Titles I and II of BCRA.

McConnell v. Federal Election Commission,

540 U.S. 93 , 124 S.Ct. 619 , 157 L.Ed.2d 491 (2003). This Court, after hearing the parties’ views, set a briefing schedule for the pending cross-motions for summary judgment.

On February 27, 2004, the parties filed their respective Motions for Summary Judgment. Opposition briefs were filed on March 31, 2004.

The Court did not require the filing of Reply briefs, and the parties did not seek leave to

file

such briefs.

After considering the parties’ briefing, the administrative record, and the relevant law, the Court shall grant-in-part and deny-in-part Plaintiffs’ Motion for Summary Judgment and grant-in-part and deny-in-part Defendant’s Motion for Summary Judgment.

I: BACKGROUND

The Court begins its discussion of the facts by noting that this Court strictly adheres to the text of Local Civil Rule 56.1 (identical to Local Civil Rule 7(h)). As such, in resolving the present summary judgment motions, this Court “assumes that facts identified by the moving party in its statement of material facts are admitted, unless such a fact is controverted in the statement of genuine issues filed in opposition to the motion.” LCvR 56.1. In this instance, as the parties cross move for summary judgment, the Court looks to each party’s statement to cull the relevant undisputed facts and to determine those facts that are conceded by the cross moving party. Having set forth these preliminaries, the Court moves to a discussion of the material facts not genuinely in dispute.

On February 13, 2002, the House of Representatives passed H.R. 2356.

*37

McConnell,

251 F.Supp.2d at 205 (per curiam). The bill was then adopted by the Senate on March 18 and 20, 2002. Def.’s Statement of Material Facts Not in Genuine Dispute (“Def.’s Stmt.”) ¶ 1. President George W. Bush signed H.R. 2356 into law on March 27, 2002.

Id.

¶ 2. The Act is commonly referred to as the Bipartisan Campaign Reform Act or “BCRA.” id

BCRA represents the most recent amendment to the Federal Election Campaign Act of 1971 (the “Act” or “FECA”).

Id.

¶ 3.

The Federal Election Commission (“FEC” or “Commission” or “Defendant”) is the independent agency of the United States government with exclusive jurisdiction to administer, interpret and civilly enforce FECA.

Id.

¶ 4. Section 402(c)(2) of BCRA required the FEC to promulgate rules within 90 days of BCRA’s enactment to carry out the provisions found in Title I of BCRA, which added new limitations on party, candidate, and officeholder solicitations and use of nonfederal funds.

Id.

¶ 6. On May 20, 2002, the Commission published its Notice of Proposed Rulemaking (“NPRM”) on “Prohibited and Excessive Contributions; Non-Federal Funds or Soft Money.”

Id.;

Pis.’ Stmt, of Genuine Issues in Opp’n to Def.’s Stmt. (“Pls.’ Opp’n Stmt.”) ¶ 6. In its NPRM, the Commission solicited comments on its proposed rules, and in response received many public comments, and heard testimony on June 4 and 5, 2002. Def.’s Stmt. ¶ 7. The Commission held an open meeting on June 19, 20 and 22, 2002, and adopted its Title I regulations on June 22, 2002. Pls.’ Statement of Material Facts as to Which Plaintiffs Contend There is No Genuine Issue (“Pls.’ Stmt.”) ¶ 4. On July 16, 2002, the FEC transmitted to Congress, and on July 29, 2002, the Commission promulgated in the Federal Register, its final rules and Explanation and Justification (“E

J”) on “Prohibited and Excessive Contributions: Non-federal Funds or Soft Money.” Def.’s Stmt. ¶ 7. These regulations became effective on November 6, 2002. Pls.’ Stmt. ¶ 4.

Section 402(c)(1) of BCRA required the FEC to promulgate within 270 days of its enactment the remaining regulations required to carry out BCRA. Def.’s Stmt. ¶ 8. On August 7, 2002, the Commission published its NPRM for Electioneering Communications in the Federal Register, which sought comments on its proposed rules.

Id.

In response, the Commission received many comments, and it heard testimony on its proposed rules on August 28 and 29, 2002.

Id.

¶ 9. The Commission also conducted an open meeting, and on October 10, 2002, adopted the regulations. Pls.’ Stmt. ¶ 5. On October 11, 2002, the Commission transmitted to Congress, and on October 23, 2002, the Commission promulgated in the Federal Register, its final rules and E

J on “Electioneering Communications.” Def.’s Stmt. ¶ 9. These regulations became effective November 22, 2002. Pls.’Stmt. ¶ 5.

On August 22, 2002, the Commission published its NPRM on “Contribution Limitations and Prohibitions” in the Federal Register, which sought comments on proposed changes to the Commission’s rules related to campaign contribution limitations and prohibitions under FECA as amended by BCRA. Def.’s Stmt. ¶ 10. In response, the Commission received many comments, and on November 8, 2002, the FEC transmitted to Congress, and on No

*38

vember 19, 2002, the Commission promulgated in the Federal Register, its final rules and E & J on “Contribution Limitations and Prohibitions.”

Id.

¶ 11.

On September 24, 2002, the FEC published its NPRM on “Coordinated and Independent Expenditures” in the Federal Register, which sought comments on proposed changes to its rules relating to payments for communications that are coordinated with a candidate and independent expenditures under FECA as amended by BCRA.

Id.

¶ 12. In response, the Commission received many comments,

id.

¶ 13, and the Commission held a public hearing on its proposed rules on October 23 and 24, 2002, at which it heard testimony from various witnesses, Pis.’ Stmt. ¶ 6. After conducting an open meeting, the Commission adopted the regulations on December 5, 2002.

Id.

On December 18, 2002, the FEC transmitted to Congress, and on January 3, 2003, promulgated in the Federal Register, its final rules on “Coordinated and Independent Expenditures.” Def.’s Stmt. ¶ 13. These regulations became effective on February 3, 2003. Pls.’ Stmt. ¶ 6.

Plaintiffs are both citizens of the United States, Members of Congress, candidates, voters, recipients of campaign contributions, fundraisers, and members of political parties.

Id.

¶ 11. Plaintiff Christopher Shays is a Member of the United States House of Representatives from the Fourth Congressional District of the State of Connecticut.

Id.

¶ 7. He was first elected in 1987, was re-elected in 1992, and has been re-elected every two years thereafter and is running for re-election in November 2004.

Id.

Plaintiff Martin Meehan is a Member of the United States House of Representatives from the Fifth Congressional District of the Commonwealth of Massachusetts.

Id.

¶ 8. He was first elected to Congress in 1988, and has been reelected every two years thereafter and is running for re-election in November 2004.

Id.

Plaintiffs are subject to regulation under FECA, BCRA, and the Commission’s implementing regulations.

Id.

¶ 11.

Both Plaintiffs were principal sponsors in the House of Representatives of the legislation enacted as BCRA and spent many years seeking to promote its enactment.

Id.

¶ 9. They, along with other cosponsors of BCRA, submitted written comments on the FEC’s proposed rules implementing BCRA’s provisions.

Id.

¶ 10. The Commission did not adopt some of their views in its final rules.

Id.;

Def.’s Resps. & Objections to Pls.’ Stmt. (“Def.’s Resp. Stmt.”) ¶ 10.

II: DISCUSSION

A. Justiciability Arguments

Before the Court can address the merits of the pending motions, it must first resolve two justiciability issues raised by Defendant. Defendant asserts that Plaintiffs lack standing to bring their claims. Defendant also contends that Plaintiffs’ claims are not ripe for review. The Court addresses each claim in turn.

1. Standing

a. Article III Standing

As an Article III court, this Court’s judicial power extends only to “Cases” and “Controversies.”

National Treasury Employees Union v. United States,

101 F.3d 1423, 1427 (D.C.Cir.1996) (quoting U.S. Const. art. III, § 2). “In an attempt to give meaning to Article Ill’s case-or-con

*39

troversy requirement, the courts have developed a series of principles termed ‘justi-ciability doctrines,’ among which are standing[,] ripeness, mootness, and the political question doctrine.”

Id.

(citing

Allen v. Wright,

468 U.S. 737, 750 , 104 S.Ct. 3315 , 82 L.Ed.2d 556 (1984)). These doctrines incorporate both the prudential elements, which “Congress is free to override,”

id.

(quoting

Fair Employment Council of Greater Wash., Inc. v. BMC Mktg. Corp.,

28 F.3d 1268, 1278 (D.C.Cir. 1994)), and “core component^]” which are “essential and unchanging part[s] of the case-or-controversy requirement of Article III,”

id.

(quoting

Lujan v. Defenders of Wildlife,

504 U.S. 555, 560 , 112 S.Ct. 2130 , 119 L.Ed.2d 351 (1992) (internal quotations omitted)).

In order to satisfy the constitutional standing requirements, the party invoking federal jurisdiction must establish that he or she has (1) suffered an injury in fact, (2) which is fairly traceable to the challenged act, and (3) is likely to be redressed by a favorable decision.

Lujan,

504 U.S. at 560-61 , 112 S.Ct. 2130 . The “injury in fact” requirement requires the plaintiff to have suffered “an invasion of a legally protected interest which is (a) concrete and particularized and (b) actual or imminent, not conjectural or hypothetical.”

Id.

at 560 , 112 S.Ct. 2130 (internal quotation marks and citations omitted).

Defendant attacks Plaintiffs’ standing to bring this suit, focusing on the injury prong of the analysis.

See

Def.’s Mem. in Supp. of its Mot. for Summ. J. (“Def.’s Mem.”) at 3-11. Plaintiffs contend that they do meet Article Ill’s standing requirements. In so doing, Plaintiffs rely predominantly on the three-judge

McConnell

panel’s decision finding that they had standing to intervene in that case to defend the constitutionality of BCRA. Pls.’ Mem. in Supp. of Pls.’ Mot for Summ. J. (“Pls.’ Mem.”) at 84. There, the panel found the proposed defendant-intervenors’ allegations that they were “among those whose conduct the Act regulates, and among those whom the Act seeks to insulate from the actual and apparent corrupting influence of special interest money,” that “[tjhey want to run in elections, participate in a political system, and serve in a government in which all participants comply with the ... campaign finance regulations that the Act imposes in order to stop evasion and to prevent actual and apparent corruption,” and that “[i]f any of the reforms embodied in the Act are struck down ... [the] movants will once again be forced to attempt to discharge their public responsibilities, raise money, and campaign in a system that [they believe to be] significantly corrupted by special-interest money,” to be “sufficient to support Article III standing.”

McConnell v. Federal Election Commission,

Civ. No. 02-582 slip op. at 6 (D.D.C. May 3, 2002) (Pls.’ Ex. 163)

(‘McConnell

Intervention Order”). The panel noted that “as opposed to members of the general public, the movants have a concrete, direct, and personal stake — as candidates and potential candidates — in the outcome of a constitutional challenge to a law regulating the processes by which they may attain office.”

Id.

at 7 (citing

Buchanan v. Federal Election Commission,

112 F.Supp.2d 58, 65 (D.D.C.2000);

Vote Choice Inc. v. DiStefano,

4 F.3d 26, 37 (1st Cir.1993)).

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Plaintiffs contend that just as they “had a ‘concrete and particularized’ personal interest in defending BCRA from constitutional attack, so too do they have a strong personal stake in seeking to overturn unlawful agency rules that threaten to subvert, erode, and circumvent the reforms enacted by BCRA.” Pls.’ Mem. at 84 (citation omitted);

see also

Pls.’ Mem. in Opp’n to Def.’s Mot. for Summ. J. (Pls.’ Opp’n”) at 15 (stating Plaintiffs are injured because “the challenged regulations authorize campaign finance activities that subvert, erode, and circumvent FECA and BCRA.”). They make clear that they are not seeking to vindicate a sponsorship interest in the Act; rather, much like their interest in

McConnell v. Federal Election Commission,

they claim to have a “tangible stake in the outcome of an APA challenge to rules that” allegedly “threaten to undermine federal campaign finance law, that seek to

deregulate

conduct that Congress specifically ordered to be regulated, and that would perpetuate much of the corrupt soft-money system that BCRA was intended to eradicate root and branch.”

Id.

at 85 (emphasis in original). In support of their contentions, both Shays and Meehan attest that they are subject to FECA and BCRA as candidates, voters, recipients of campaign contributions, fundraisers, and political party members. Decl. of PI. Meehan (“Meehan Decl.”) ¶ 3; Decl. of Pl. Shays (“Shays Deck”) ¶ 3. They state that in addition to being directly regulated by these laws and regulations, their “activities are also directly affected by the fact that others, including ... potential contributors and supporters, ... potential election opponents, contributors to and supporters of ... opponents, and contributors to and supporters of both political parties are subject to the same regulation under FECA, BCRA, and the Commission’s implementing rules.”

Id.

They also specifically discuss the impact of the alleged deficiencies in the regulatory regime implementing BCRA:

If any of the campaign finance reforms embodied in BCRA is subverted, eroded or circumvented by the Commission’s implementing regulations, I will be forced once again to raise money, campaign, and attempt to discharge my important public responsibilities in a system that is widely perceived to be, and I believe in many respects will be, significantly corrupted by the influence of special-interest money. The FEC regulations that implement the soft-money provisions of Title I of BCRA directly affect me. If those regulations do not implement the soft-money ban, I face

*41

the strong risk that unregulated soft money contributions will again be used in an attempt to influence federal elections in which I am a candidate. The rules implementing the soft money ban also will affect the perception the public will form of me, my fellow office-holders, and fellow party members.

Likewise, the FEC regulations that implement the loophole-closing extension of the soft money provisions to the funding for certain state and local activities that affect federal elections ... will directly and personally impact me as a candidate who runs in elections that could be affected by those very state and local party activities, as well as in my capacity as a party member who might be expected to raise soft money directly or indirectly for use at the state and local party level.

The Commission’s regulations implementing the sham issue ad provisions in Title II-A of BCRA also directly affect me as a candidate. If those regulations do not faithfully implement Title II-A, I will be open to attack, during critical time periods just before primary and general elections, in broadcast advertising campaigns mounted by groups seeking to evade the contribution limits, source prohibitions, and disclosure requirements imposed by Congress. Similarly, I will be directly affected as a candidate by the Commission’s regulations regarding coordinated communications .... If those regulations do not faithfully implement Congressional intent, my election opponents will be able to interact and coordinate with their parties, their supporters, and interest groups in ways that evade the contribution limits, source prohibitions, and disclosure requirements of federal law. Many FECA and BCRA provisions require the disclosure of campaign finance information by covered persons and entities. If the FEC regulations do not faithfully implement these disclosure provisions, I will be deprived of information to which I am entitled under FECA and BCRA.

Id.

¶¶ 4-9.

The FEC claims that Plaintiffs have not met their burden of establishing their standing to bring this suit. The FEC contends that Plaintiffs do not challenge the regulations as they affect their own actions, but rather allege that the regulations fail “to regulate the activities of

other people

more strictly.” Def.’s Mem. at 4 (emphasis in the original). This fact, Defendant maintains, increases the burden Plaintiffs must meet to establish standing.

Id.

at 4-5. In addition, since this case is at the summary judgment stage, Defendant points out that Plaintiffs must support their standing arguments with evidence and argues that they have failed to do so. Def.’s Resp. in Supp. of its Mot. & in Opp’n to Pls.’ Mot. for Summ. J. (“Def.’s Opp’n”) at 2 & n. 2, 7-8.

Defendant is correct that at the summary judgment stage, “the plaintiff [may not] rest on ... ‘mere allegations,’ but must ‘set forth’ by affidavit or other evidence ‘specific facts,’ which for the purposes of the summary judgment motion will be taken to be true.”

Lujan,

504 U.S. at 561 , 112 S.Ct. 2130 (quoting Fed. R.Civ.P. 56(e));

see also id.

at 567, 112 S.Ct. 2130 (noting that at the summary judgment stage the standing inquiry demands “a factual showing of perceptible harm.”).

As noted

supra,

Plaintiffs argue that the

McConnell

panel’s decision finding that they had standing to defend the constitutionality of BCRA is instructive here. The

McConnell

panel found that the interve-nors had a “direct, and personal stake — as candidates and potential candidates — in

*42

the outcome of a constitutional challenge to a law regulating the processes by which they may attain office.”

McConnell

Intervention Order at 7. The Court finds that the present case implicates the same interest. Just as Plaintiffs would have been affected — adversely in their view — from the striking down of BCRA on constitutional grounds, so are they affected by the regulations they claim improperly implement BCRA and “regulat[e] the processes by which they may attain office.”

Id.

This finding, however, does not end the Court’s inquiry, as Defendant notes that the

McConnell

panel’s decision was made at the pleading stage and not revisited, whereas here the Court is faced with a standing challenge at the summary judgment stage.

As noted

supra,

Plaintiffs support their injury claims with declarations. These sworn statements appear to be the only factual basis presented in support of Plaintiffs’ claim that they have standing. It is clear from these submissions that Plaintiffs are or will be affected by the campaign finance regime established by the current regulations. They claim that their campaign activities are affected by other participants in the political process who are subject to the same rules, and that the current regulations — by being, in then-view, unfaithful to the terms of BCRA— force them to raise money in a system that is perceived to be and in their view is “corrupted by the influence of special-interest money.” Meehan Decl. ¶¶ 3-4; Shays Decl. ¶¶ 3-4. Defendant dismisses the sufficiency of these statements, arguing that Plaintiffs

have presented no facts suggesting that any identifiable party has any plans to engage in any of the activities they think should be prohibited in connection with their own election campaigns, and they have not offered any factual basis for thinking any such activities by third parties that may materialize are more likely to oppose than to support their own reelection chances.

Def.’s Opp’n at 2. The Commission also cites, to substantive areas of Plaintiffs’ opening brief where they complain of loopholes and provisions unfaithful to BCRA and contends that these arguments are not supported by any evidence that entities are actually engaging in the actions to which Plaintiffs object.

Id.

at 2-3. The FEC states that “[i]n the absence of any factual showing that the activities [Plaintiffs] think should be prohibited are going to be used to help defeat them in them own elections, plaintiffs have failed to satisfy their threshold burden to demonstrate ‘concrete’ harm to themselves that is ‘actual or imminent.’ ”

Id.

at 4 (quoting

McConnell,

124 S.Ct. at 707 ).

The Court finds that Defendant’s attacks on Plaintiffs’ factual support for the injury-in-fact prong miss the point of Plaintiffs’ alleged harm. Plaintiffs are undisputedly participants in the federal campaign finance system. They attest that their activities are affected not only by the manner in which they respond to the campaign finance rules, but also by the way in which other participants, both allies and adversaries, respond to the rules. Meehan Decl. ¶¶ 3-4; Shays Decl. ¶¶ 3-4. Whether or not they have alleged that some entity has in fact taken advantage of an alleged FEC-created loophole in BCRA, the fact that such a loophole exists affects the way these politicians, who face election in a matter of months, will run their campaigns. If the FEC has promulgated regulations unfaithful to BCRA, then Plaintiffs are at the very least harmed by having to anticipate other actors taking advantage of the regulations to engage in activities that otherwise would

*43

be barred.

The First Circuit has recognized that “an impact on the strategy and conduct of an office-seeker’s political campaign constitutes an injury of a kind sufficient to confer standing.”

Becker v. Federal Election Commission,

230 F.3d 381, 386 (1st Cir.2000) (quoting

Vote Choice, Inc. v. DiStefano,

4 F.3d 26, 37 (1st Cir. 1993)). In fact, the First Circuit has held such an injury to exist even when the change in strategy is speculative, and the planned-for circumstance fails to materialize.

Vote Choice, Inc., 4

F.3d at 31, 37;

see also id.

at 843 n. 9, 104 S.Ct. 2778 (“[A]d-ministrative constructions which are contrary to clear congressional intent” must be rejected by the court). “When performing this first step, [courts] employ traditional tools of statutory construction.”

Independent Ins. Agents of Am., Inc. v. Hawke,

211 F.3d 638, 643 (D.C.Cir.2000) (citing

Chevron,

467 U.S. at 842-43 , 104 S.Ct. 2778 ;

INS v. Cardoza-Fonseca,

480 U.S. 421, 446 , 107 S.Ct. 1207 , 94 L.Ed.2d 434 (1987)). Among these tools is a statute’s legislative history.

See American Fed’n of Labor & Congress of Indus. Orgs. v. Federal Election Commission,

333 F.3d 168, 172 (D.C.Cir.2003)

(“AFL-CIO

”);

American Bankers Ass’n v. Nat’l Credit Union Admin.,

38 F.Supp.2d 114, 134 (D.D.C.1999);

see also Natural Res. Def. Council v. Browner,

57 F.3d 1122, 1127 (D.C.Cir.1995) (“Reference to statutory design and pertinent legislative history may often shed new light on congressional intent, notwithstanding statutory language that appears ‘superficially clear.’ ”) (quot

*52

ing

American Scholastic TV Programming Found, v. Federal Communications Commission,

46 F.3d 1173 , 1178 (D.C.Cir. 1995)). However, canons of construction are only to be used during step one of the

Chevron

analysis to determine if “Congress had a

specific

intent on the issue in question.”

Mich. Citizens for an Indep. Press v. Thornburgh,

868 F.2d 1285, 1292-93 (D.C.Cir.1989) (emphasis in original). In conducting this stage of the

Chevron

analysis, the Court “giv[es] no deference to the agency’s interpretation.”

AFL-CIO,

333 F.3d at 173 .

If the court finds that “the statute is silent or ambiguous with respect to the specific issue, the question for the court is whether the agency’s answer is based on a permissible construction of the statute.”

Chevron,

467 U.S. at 843 , 104 S.Ct. 2778 . “A statute is considered ambiguous if it can be read more than one way.”

AFL-CIO,

333 F.3d at 173 . “The court need not conclude that the agency construction was the only one it permissibly could have adopted to uphold the construction, or even the reading the court would have reached if the question initially had arisen in a judicial proceeding.”

Chevron,

467 U.S. at 843 n. 11, 104 S.Ct. 2778 . Therefore

[w]hen a challenge to an agency construction of a statutory provision, fairly conceptualized, really centers on the wisdom of the agency’s policy, rather than whether it is a reasonable choice within a gap left open by Congress, the challenge must fail. In such a case, federal judges — who have no constituency — have a duty to respect legitimate policy choices made by those who do. The responsibilities for assessing the wisdom of such policy choices and resolving the struggle between competing views of the public interest are not judicial ones: “Our Constitution vests such responsibilities in the political branches.”

Id.

at 866 , 104 S.Ct. 2778 (quoting

TVA v. Hill,

437 U.S. 153, 195 , 98 S.Ct. 2279 , 57 L.Ed.2d 117 (1978)). However, “[i]f the FEC’s interpretation unduly compromises the Act’s purposes, it is not a ‘reasonable accommodation’ under the Act, and it would therefore not be entitled to deference.”

Orloski v. Federal Election Commission,

795 F.2d 156, 164 (D.C.Cir.1986) (quoting

Chevron,

467 U.S. at 845 , 104 S.Ct. 2778 );

see also

Def.’s Mem. at 79 (“[DJuring the last 120 days before an election, a communication that is not a republication of a candidate’s own campaign materials will not be treated as a ‘coordinated expenditure’ if it does not at least mention a candidate or political party.”). In fact, in its publication of the rule, the Commission noted that “[i]n effect, the content standard of paragraph (c)(4)(ii) operates as a ‘safe harbor’ in that communications that are publicly disseminated or distributed more than 120 days before the primary or general election will not be deemed to be ‘coordinated’ under this particular content standard

under any circumstances.”

Coordinated & Independent Expenditures, 68 Fed.Reg. at 430 n. 2 (emphasis added). However, the Commission does contend that the universe of permissible coordinated communications under the rule is narrower than Plaintiffs suggest. Def.’s Opp’n at 57. It points out that “express advocacy”

and “the dissemination of a candidate’s own campaign materials,” are barred year-round.

Id.

at 58 . The Commission also notes that the 120-day window applies to numerous political events which occur at different time periods, and that “these multiple 120-day windows will usually include a majority of the days in even-numbered years preceding the November election.”

Id.

Applying the

Chevron

analysis, the Court first inquires as to whether or not “Congress has directly spoken on the precise question at issue.”

Chevron

467 U.S. at 842 , 104 S.Ct. 2778 . The Court does so “using traditional tools of statutory construction and legislative history.”

AFL-CIO,

333 F.3d at 172 . Plaintiffs contend that the fact that Congress included a 120-day window in a separate provision of BCRA

suggests, “[u]nder the canon

ex-

*59

pressio unius est exclusio alterius

” that Congress “intended for no temporal restrictions to apply to provisions it did not similarly limit.” Pls.’ Mem. at 14. Defendant rejects this conclusion, arguing that “under

Chevron

the ‘contrast between Congress’s mandate in one context with its silence in another suggests not a prohibition but simply a decision

not to mandate

any solution in the second context, ie., to leave the question to agency discretion.’ ” Def.’s Opp’n at 23 (quoting

Amax Land Co. v. Quarterman,

181 F.3d 1356, 1365 (D.C.Cir.1999) (omitting citations) (emphasis in original)). Indeed, this Circuit has noted the academic criticism of the canon, and has held that

[wjhatever its general force, we think it an especially feeble helper in an administrative setting, where Congress is presumed to have left to reasonable agency discretion questions that it has not directly resolved. Here the contrast between Congress’s mandate in one context with its silence in another suggests not a prohibition but simply a decision

not to mandate

any solution in the second context,

ie.,

to leave the question to agency discretion. Such a contrast (standing alone) can rarely if ever be the “direct[ ]” congressional answer required by

Chevron .

Cheney R.R. Co. v. Interstate Commerce Comm’n,

902 F.2d 66, 69 (D.C.Cir.1990) (emphasis in original). However, this general rule is not without its exceptions. As Plaintiffs point out, this Circuit recently found an agency regulation to be contrary to Congress’s express intent relying in part on the canon of

expressio unius est exclusio alterius.

Pls.’ Mem. at 14 n. 24. In

Independent Insurance Agents of America v. Hawke,

the D.C. Circuit acknowledged that it had “rejected the canon in some administrative law cases, but only where the logic of the maxim — that the special mention of one thing indicates an intent for another thing not be included elsewhere — did not hold up in the statutory context.” 211 F.3d 638 , 644 (D.C.Cir. 2000) (citing

Texas Rural Legal Aid, Inc. v. Legal Servs. Corp.,

940 F.2d 685, 694 (D.C.Cir.1991);

Clinchfield Coal Co. v. FMSHRC,

895 F.2d 773, 779 (D.C.Cir. 1990);

Cheney R.R. Co.,

902 F.2d at 68-69 ). The

Hawke

court noted further that “if there are other reasonable explanations for an omission in a statute,

expressio uni-us

may not be a useful tool.”

Id.

“But, where the context shows that the ‘draftsmen’s mention of one thing, like a grant of authority, does really necessarily, or at least reasonably, imply the preclusion of alternatives,’ the canon is a useful aid.”

Id.

(quoting

Shook v. District of Columbia Fin. Responsibility & Mgmt. Assistance Auth.,

132 F.3d 775, 782 (D.C.Cir.1998)).

A review of the provision in question reveals that the

expressio unius

canon does not demonstrate that Congress has spoken directly on the question of time limits. Indeed, BCRA Section 214 expressly provides the Commission with the authority to promulgate new regulations addressing coordinated communications, with some guidance regarding what matters should be covered by the regulations and a single prohibition against equating coordination with “agreement or formal collaboration.” 2 U.S.C. § 441a note (quoted

supra

at 56). Otherwise, the regulation is silent on the parameters of this delegation of authority. The Court does not find persuasive the argument that the inclusion of a 120-day period in a separate and unrelated section of BCRA, but not in Section 214, means that Congress has spoken clearly on whether or not such a requirement may be included in the

*60

coordinated communications regulations. Accordingly, the Court rejects Plaintiffs’ argument that the

expressio unius

canon of statutory construction reveals Congress’s specific intent on this matter.

Plaintiffs also appear to make an argument under the legislative reenactment doctrine, although they do not invoke the doctrine by name. Noting that the FEC had consistently treated the content of communications as irrelevant for purposes of determining whether or not they were coordinated under FECA, Plaintiffs argue that the “Commission was not at liberty to depart from [this] long-standing construction relied upon by Congress as it fine-tuned the campaign finance laws.” Pls.’ Mem. at 16-17;

see also id.

at- 17 n. 31 (citing legislative reenactment doctrine cases). Defendant contends that the doctrine is inapplicable to the current case. Def.’s Opp’n at 15 n. 26, 55-56 n. 83.

The legislative reenactment doctrine provides that “Congress is presumed to be aware of an administrative or judicial interpretation of a statute and to adopt that interpretation when it reenacts a statute without change[.]”

Lorillard v. Pons,

434 U.S. 575, 580 , 98 S.Ct. 866 , 55 L.Ed.2d 40 (1978). This Circuit has noted that while “courts have stated this general proposition, usually as a defense to a later attack against the same interpretation,

case has rested on this presumption alone as a basis for holding that the statute required that interpretation.”

American Fed’n of Labor & Congress of Indus. Orgs. v. Brock,

835 F.2d 912 , 916 n. 6 (1987) (emphasis in original) (listing cases including

Lorillard)

The

Brock

court observed that

*61

[t]he authority to whom the Supreme Court as well as lower courts refer for this rule of statutory construction makes this qualification explicit: “[The rule of implied adoption of an agency interpretation on reenactment] does not apply where nothing indicates that the legislature had its attention directed to the administrative interpretation upon reenactment.” C. Sands, Sutherland on Statutory Construction § 49.09, at 400 (footnote omitted) (4th ed.1984).

Id.

Therefore, the

Brock

court held that [t]o freeze an agency interpretation, Congress must give a strong affirmative indication that it wishes the present interpretation to remain in place.”

Id.

at 916;

see also id.

§ 441a(a)(7)(B)(ii) (same for political parties). BCRA Section 214 did nothing to change this requirement; it merely ordered the FEC to promulgate new regulations regarding coordinated communications, and provided some guidance. Nor did Congress evince any intent to qualify the reach of this provision of FECA, or to exclude from its reach any particular type of “coordination.” Such a move would run counter to the basic notion that a coordinated expenditure, by virtue of its coordi

*63

nation (not its content), is valuable to the political entity with which it is coordinated. As the

Buckley

Court observed, “prearranged or coordinated expenditures” circumvent campaign finance laws because they “amount[ ] to disguised contributions.”

Buckley,

424 U.S. at 47 , 96 S.Ct. 612 . Such expenditures differ from truly independent expenditures because “[t]he absence of prearrangement and coordination of an expenditure with the candidate or his agent not only undermines the value of the expenditure to the candidate, but also alleviates the danger that the expenditures will be given as a quid pro quo for improper commitments from the candidates.”

Id.

The

McConnell

Court reiterated this rationale, noting that “[ijndepen-dent expenditures are poor sources of leverage for a spender because they might be duplicative or counterproductive from a candidate’s point of view. By contrast, expenditures made after a “wink or nod’ often will be as useful to the candidate as cash.”

McConnell,

124 S.Ct. at 705 (internal quotation marks and citations omitted). If an outside entity or individual makes a coordinated communication, that communication presumably has value to the political entity it is coordinated with, regardless of when it is broadcast or its contents.

See Federal Election Commission v. Christian Coalition,

52 F.Supp.2d 45, 92 (D.D.C.1999) (“The fact that the candidate has requested or suggested that a spender engage in certain speech indicates that the speech is valuable to the candidate, giving such expenditures sufficient contribution-like qualities to fall within [FECA’s] prohibition on contributions.”). To exempt certain types of communications runs completely afoul of this basic tenet of campaign finance law, thereby undercutting FECA’s statutory purpose of regulating campaign finance and preventing circumvention of the campaign finance rules, and therefore the regulation is entitled to no deference.

The text and legislative history of Section 214 demonstrate that Congress had no intention of modifying this fundamental understanding of campaign finance law. Plaintiffs’ citations to the floor statements of BCRA co-sponsors Senators John McCain and Russell Feingold bear this out.

The Commission notes that these statements “when read in context, [make it] clear that the Senators were discussing the requirement that the new regulations must not require an agreement or formal collaboration, not the issues raised in the regulation’s

content

provisions.” Def.’s Opp’n at 55 n. 82 (emphasis in original). A review of the statements reveals that the Commission is correct that the focus of the sponsors’ comments is on defining what constitutes coordination, not on content restrictions. The regulation Congress repealed provided that an otherwise independent political communication would be deemed coordinated if

[a]fter substantial discussion or negotiation between the creator, producer or distributor of the communication, or the person paying for the communication, and the candidate, the candidate’s authorized committee, a party committee, or the agent of such candidate or committee, regarding the content, timing, location, mode, intended audience, vol

*64

ume of distribution or frequency of placement of that communication, the result of which is collaboration or agreement. Substantial discussion or negotiation may be evidenced by one or more meetings, conversations or conferences regarding the value or importance of the communication for a particular election.

11 C.F.R. § 100.23 (c)(2)(iii) (2001)

(repealed

). Senator Feingold commented that the “[a]fter substantial discussion” and the “the result of which is collaboration or agreement” language “set[] too high a bar to the finding of ‘coordination.’ This standard would miss many cases of coordination that result from de facto understandings. Accordingly, section 214 states that the Commission’s new regulations ‘shall not require agreement or formal collaboration to establish coordination.’” 148 Cong. Rec. S2145 (daily ed. Mar. 20, 2002) (statement of Sen. Fein-gold). Senator McCain echoed Senator Feingold’s comments, noting that

[i]nformal understandings and de facto arrangements can result in actual coordination as effectively as explicit agreement or formal collaboration. In drafting new regulations to implement the existing statutory standard for coordination — an expenditure made “in cooperation, consultation or concert, with, or at the request or suggestion of’ a candidate — we expect the FEC to cover “coordination” whenever it occurs, not simply when there has been an agreement or formal collaboration.

Id.

(statement of Sen. McCain).

While it is true that these statements are silent on the matter of content restrictions, it is clear that this omission was not the result of a desire to allow the Commission freedom to create whatever content rules it wanted, but rather from the basic understanding that established campaign finance law treats coordinated communications expenditures as contributions regardless of their content or when they are broadcast. This is evident from Senator McCain’s statement that the sponsors of BCRA “expect[ed] the FEC to cover ‘coordination’

whenever it occurs,

not simply when there has been an agreement or formal collaboration.”

Id.

(emphasis added).

Given the state of the law, it is not surprising that the repealed regulation included no guidance on content restrictions and that the sponsors focused their comments on what was troublesome about the previous regulation, not what provisions would have been troublesome had they been included in the provision. Clearly, the statements by Senators McCain and Feingold make clear that the purpose of passing Section 214 of BCRA was not to exempt certain acts of coordination, but rather to enlarge the concept of what constitutes “coordination” under campaign finance law.

See

148 Cong. Rec. S2145 (statement of Sen. Feingold) (Section 214 “does not change the basic statutory standard for coordination, which defines and sets parameters for the FEC’s authority to develop rules describing the circumstances in which coordination is deemed to exist.”).

The Court therefore concludes that pursuant to step two of the

Chevron

analysis, the FEC’s exclusion of coordinated communications made more than 120 days before a political convention, general or primary election, as well as any that do not refer to a candidate for federal office or a

*65

political party and any not aimed at a particular candidate’s electorate or electorate where a named political party has a candidate in the race, undercuts FECA’s statutory purposes and therefore these aspects of the regulations are entitled to no deference. A communication that is coordinated with a candidate or political party has value to the political actor. To exclude certain types of communications regardless of whether or not they are coordinated would create an immense loophole that would facilitate the circumvention of the Act’s contribution limits, thereby creating “the potential for gross abuse.”

Orloski

795 F.2d at 165 . The FEC’s regulation therefore is “not a reasonable accommodation under the Act,”

Orloski

795 F.2d at 164 (internal quotation marks omitted), and fails

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step two.

b. Exclusion of the Internet

The coordinated communication regulation, excerpted

supra,

applies only to “public communications” unless the communication constitutes an “electioneering communication.” 11 C.F.R. § 109.21 (c)(4). Congress defined “public communication” in BCRA to mean “a communication by means of any broadcast, cable, or satellite communication, newspaper, magazine, outdoor advertising facility, mass mailing, or telephone bank to the general public, or any other form of general public political advertising.” 2 U.S.C. § 481 (22). The FEC promulgated a regulation defining “public communication” as “a communication by means of any broadcast, cable or satellite communication, newspaper, magazine, outdoor advertising facility, mass mailing or telephone bank to the general public, or any other form of general public political advertising. The term public communication shall not include communications over the Internet.” 11 C.F.R. § 100.26 . Therefore, Internet communications, no matter how closely they are coordinated with political parties or a candidate’s campaign, cannot be considered “coordinated” under the FEC’s regulations. This exclusion marks a contrast from the Commission’s prior rule, which deemed all “general public political communication^]” that met certain conduct requirements to be “coordinated.” 11 C.F.R. § 100.23 (c)(2)(iii) (2001)

(repealed); see also supra

note 25 (quoting 11 C.F.R. § 100.23 (c)(2)(iii)). “General public communications” were defined to “include those made through a broadcasting station (including a cable television operator), newspaper, magazine, outdoor advertising facility, mailing

or any electronic medium, including the Internet or on a web site,

with an intended audience of over one hundred people.” 11 C.F.R. § 100.23 (e)(1) (2001)(repealed) (emphasis added). Plaintiffs claim that the new regulation’s exclusion of all Internet communications from treatment as “coordinated communications” runs contrary to Congress’s intent.

Pls.’ Mem. at 20. Defendant disagrees, but devotes much of its discussion about 11 C.F.R. § 100.26 to the “context of the ‘soft money’ rulemaking.” Def.’s Opp’n at 42-48, 43 n. 64.

Applying

Chevron

step one, the Court asks whether “Congress has directly spoken on the precise question at issue.”

Chevron,

467 U.S. at 842 , 104 S.Ct. 2778 . Plaintiffs claim that the regulation fails

Chevron

step one. Pls.’ Mem. at 21-23. To assess this argument, the Court begins by examining the FEC’s explanation for excluding the Internet from the definition of “public communication.”

*66

In its Explanation and Justification (“E & J”), the Commission explained that it applied its definition of “public communication” promulgated for its regulations related to “Federal election activity” to its regulations on coordinated communications in order to “provide[ ] consistency within the regulations and [to] distinguish[ ] covered communications from, for example, private correspondence and internal communications between a corporation or labor organization and its restricted class.” Coordinated & Independent Expenditures, 68 Fed.Reg. at 430. In its separate E

J issued for its definition of “public communication,” the FEC began by noting that its rulemaking was guided by BCRA’s amendment of 2 U.S.C. § 431 ,

to include a definition for “public communication.” Prohibited

Excessive Contributions: Non-Federal Funds or Soft Money, 67 Fed.Reg. 49,064, 49,071 (July 29, 2002). FECA, as amended by BCRA, provides that “[t]he term ‘public communication’ means a communication by means of any broadcast, cable, or satellite communication, newspaper, magazine, outdoor advertising facility, mass mailing, or telephone bank to the general public, or any other form of general public political advertising.” 2 U.S.C. § 431 (22). The FEC decided not to include the Internet in its definition of “public communication” concluding that the exclusion “is consistent with the plain meaning of the statute, consistent with Congress’ decision not to include the Internet in the statutory definition of ‘public communication,’ and is the best policy decision with regard to implementation of BCRA.” Prohibited

Excessive Contributions, 67 Fed.Reg. at 49,072. The Commission explained that its statutory construction was based on the fact that Congress “excluded [the Internet] from the list of media that constitute public communication under the statute. BCRA does not reference the ‘Internet’ or ‘electronic mail’ in this section, although Congress used the terms ‘Internet,’ ‘website,’ and “World Wide Web address’ in other sections of BCRA.”

Id.

(citing 2 U.S.C. §§ 434 note, 438a).

The Commission also pointed out that “Congress has also used the terms ‘Internet’ and ‘electronic mail’ in other statutes and distinguished them from ‘telecommunications services.’ ”

Id.

Acknowledging that BCRA does include the phrase “any other form of general political advertising” in the definition of “public communication,” the Commission explained that

[g]eneral language following a listing of specific terms, however, does not evidence Congressional intent to include a separate and distinct term that is not listed, such as the Internet.

See

Sutherland Statutes and Statutory Construction, section 47; 17

Ejusdem generis,

Vol. 2A (6th ed.2000). It is also noted that there is no indication in the legislative history that Congress contemplated including the Internet in the definition of public communication.

Id.

The Commission then explained the “significant policy reasons” for excluding the Internet from the definition.

Plaintiffs argue that

[o]n its face, the phrase

“any other form

of general political advertising” plainly includes at least certain communications over the Internet. There can be no question that ‘political advertising’ takes place on the Internet (in exponentially

*67

increasing amounts), and that there are various mechanisms by which such advertising over the Internet is targeted at the “general public.”

Pls.’ Mem. at 22. Defendant counters that this argument “amounts to a concession that BCRA does not speak to the precise question at issue under

Chevron

step one.” Def.’s Opp’n at 43;

see also

Def.’s Mem. at 36 (“Since the Internet is not one of the eight types of mass communication Congress listed in 2 U.S.C. § 431 (22), it is not even arguable that the statute speaks directly to the precise question at issue.”) (internal quotation marks omitted).

As already noted, Congress did not expressly include the term “Internet” in its statutory definition of “public communication,” but it did include the phrase “any other form of general public political advertising.” 2 U.S.C. § 431 (22). While all Internet communications do not fall within this descriptive phrase, some clearly do. Consequently, it is difficult to argue that the statutory terms evidence Congressional intent for the Internet, or any other forms of communications that constitute “general public political advertising,” to be excluded wholesale from its definition of “public communication.”

However, the Commission contends, as noted

supra,

that as a matter of statutory construction its position is correct. It explained in its E & J that the doctrine of

ejusdem generis

supports its position that Congress did not intend for the Internet to be included in the definition of “public communications.”

see also id.

§ 441a(a)(7)(B)(ii) (same for political parties). To permit an entire class of political communications to be completely unregulated irrespective of the level of coordination between the communication’s publisher and a political party or federal candidate, would permit an evasion of campaign finance laws, thus “unduly compromis[ing] the Act’s purposes,” and “creat[ing] the potential for gross abuse.”

Orloski,

795 F.2d at 164, 165 . Accordingly, in the alternative, the Court finds that

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the Commission’s regulation, as it applies to coordinated communications, fails

Chevron

step two.

Definition of “Agent”

Plaintiffs also object to the FEC’s definition of “agent” as it relates to the coordinated communication regulations. Pls. Mem. at 9 n. 17.

They object to the fact that the FEC limited the definition of “agent” to persons who have “actual authority, express or implied, to engage” in certain activities on behalf of certain political entities. 11 C.F.R. § 109.3 ; Pls.’ Mem. at 9 n. 17. Plaintiffs contend that the definition should include those acting with apparent authority as well. Pls. Mem. at 9 n. 17, 41, 42 n. 71. Defendant relies on the arguments it set forth in their discussion of “agent” under the nonfederal money regulations.

See

Def.’s Mem. at 77 n. 26.

Plaintiffs’ arguments regarding 11 C.F.R. § 109.3 are relegated to two footnotes, essentially directing the Court to their analysis of 11 C.F.R. § 300.2 , which defines “agent” in the context of the Commission’s nonfederal money regulations. Plaintiffs provide no separate analysis for Section 109.3.

See id.

at 9 n. 17, 41-48; Pls.’ Opp’n at 33-36 (focusing on the definition promulgated to apply to the “soft money” regulations).

As an initial matter, it is clear that Section 214 of BCRA does not mention the word “agent” or provide any guidance for how the term should be read in the context of the coordination communications regulations. Plaintiffs do not provide the Court with any legislative history or cite to another provision in the statute that manifests clear Congressional intent with regard to the definition of this term as it relates to the coordinated communication regulations.

Id.

Accordingly, the Court cannot find that under

Chevron

step one that Congress has clearly spoken on this issue.

Moving to

Chevron

step two, the Court is provided no basis for concluding that the agency’s construction of the term is impermissible.

See Chevron,

467 U.S. at 843 n. 11, 104 S.Ct. 2778 . The Commission in promulgating the definition recognized “the Congressional determination that a spender can effectively coordinate a communication by acting in cooperation, consultation, or concert with, or at the request or suggestion of, an agent....” Coordinated & Independent Expenditures, 68 Fed. Reg. at 424 (citing 2 U.S.C. § 431 (17)

2 U.S.C. § 441a(a)(7)(B)(i)). As the Court finds

infra

at 84-86, there is nothing that demonstrates that the Commission has taken an impermissible construction of the term, and it would appear that this challenge “really centers on the wisdom of the agency’s policy, rather than whether it is a reasonable choice within the gap left open by Congress .... ”

Chevron,

467 U.S. at 866 , 104 S.Ct. 2778 (quoting

TVA

437 U.S. at 195 , 98 S.Ct. 2279 ). The only remaining avenue for voiding the regulation under

Chevron

review is if the regulation “unduly compromises the Act’s purposes.”

Orloski, 795

F.2d at 164. There is nothing in the record that suggests that this interpretation “unduly compromises” FECA, and Plaintiffs have not specifically explained why or if they believe the regulation has such an effect on the coordinated communications regulation.

See

Pls. Mem. at 9 n. 17. To be sure, as Plaintiffs’ citations to comments submitted during the Commission’s rulemaking demonstrate,

see

Pls.’ Mem. at 9 n. 17, there are concerns that

*72

the decision to exclude those acting with apparent authority from the definition of “agent” may lead to circumvention of the coordination regulations. However, the Court has been provided no basis for determining whether or not such instances would

“unduly

compromise[ ]” the Act or “create the potential for

gross

abuse.”

Orloski,

795 F.2d at 164, 165 (emphasis added). The Court does not disagree that the definition may compromise the Act or create the potential for abuse, just that the dangers of these effects are not, on the record presented or on their face, sufficiently great to meet the

OrlosJci

standard. In this way, the definition of “agent” in this context differs from the content provisions of the coordinated communication regulations that the Court found unduly compromise the Act’s purposes. Accordingly, the Court finds that 11 C.F.R. § 109.3 survives

Chevron

review.

Finally, turning to the question of whether or not the Commission violated the APA’s reasoned analysis requirement, the Court finds, as it does

infra

at 87, that the Commission did not adequately explain its decision to exclude “apparent authority” from the scope of its definition of “agent.” Examining the Commission’s E

J, the Commission explains that it

would place the definition of ‘agent’ in the hands of a third party. Therefore, in the Commission’s judgment, apparent authority is not a sufficient basis for agency for the purposes of revised 11 CFR part 109. The commenter’s suggested approach would necessitate a determination of agency solely on the basis of apparent authority and is therefore inconsistent with the structure and purpose of the regulations.

Coordinated & Independent Expenditures, 68 Fed.Reg. at 424-25. This explanation provides no indication that the Commission considered how their decision might facilitate circumvention or perpetuate the appearance of corruption, two policies Congress definitely sought to advance in passing BCRA. In this manner, the Commission has “entirely failed to consider an important aspect of the problem,” which renders the rule “arbitrary and capricious.”

State Farm,

463 U.S. at 43 , 103 S.Ct. 2856 .

2. “Soft Money” Regulations

Widely regarded as the main impetus for the passage of BCRA was the pervasiveness of so-called “soft money” in the campaign finance system.

McConnell,

124 S.Ct. at 654 (“BCRA’s central provisions are designed to address Congress’ concerns about the increasing use of soft money and issue advertising to influence federal elections.”); 147 Cong. Rec. S2696 (daily ed. Mar. 22, 2001) (statement of Sen. Feingold) (“The soft money ban is the centerpiece of this bill. Our legislation

*73

shuts down the soft money system, prohibiting all soft money contributions to the national political parties from corporations, labor unions, and wealthy individuals.”); 148 Cong. Rec. S2139 (daily ed. Mar. 20, 2002) (statement of Sen. McCain) (“It is a key purpose of the bill to stop the use of soft money as a means of buying influence and access with Federal officeholders and candidates.”); Def.’s Opp’n at 32 n. 51 (noting that “increased use of soft money ... led to BCRA’s enactment ....”);

see also id.

at 661-66 (detailing the evidence supporting “Congress’ determination that large soft-money contributions to national political parties give rise to corruption and the appearance of corruption.”). Given that the aim of the statutory provision is “to put a stop” to the national political parties’ involvement with nonfederal money, as well as the danger of corruption and the appearance of corruption that arose from that interaction in the past, it is clear to the Court that Congress intended that the term “solicit” would cover conduct beyond “ask[ing]” for nonfederal donations to be given to other entities.

The Commission’s definition of “solicit” “require[s] some affirmative verbalization or writing,”

*79

in order to “provid[e] members of Congress, candidates and committees with an understandable standard.” Contribution Limitations

Prohibitions, 67 Fed.Reg. at 69,942. The purpose of Title I of BCRA is to divorce national political parties, as well as candidates for federal office and federal officeholders, from the nonfederal money business. To permit such individuals and entities to funnel nonfederal money into different organizations by simply not “asking” the donors to do so, but using more nuanced forms of solicitation, would permit conduct that would render the statute largely meaningless. Such a regime would not be unlike that under pre-BCRA FECA, where the “express advocacy” rule permitted labor unions and corporations to avoid regulation by simply avoiding Buckley’s magic words, which effectively permitted such groups to sidestep FECA’s prohibitions.

See McConnell,

124 S.Ct. at 689 . By avoiding direct “verbalizations or writings,” national political party committees, candidates for federal office and federal officeholders could effectively and legally, under the current FEC regime, solicit nonfederal money. These facts make it is clear that Congress intended for “solicit” to encompass more than just affirmative oral or written requests for nonfederal donations, and that to permit the term “solicit” to be limited by the Commission’s definition would “unduly compromise!!] the Act’s purposes” and “create the potential for gross abuse.”

Orloski,

795 F.2d at 164, 165 .

In making this determination, the Court is not insensitive to the constitutional and practical difficulties the FEC faces in promulgating such regulations. The Commission maintains that its “construction takes into consideration First Amendment values by adopting a bright-line test to minimize concerns ‘that the ability to impute intent could lead to finding a violation when the individual who made the comment may have had no intention whatever of soliciting a contribution.’ ” Def.’s Opp’n at 39 (quoting Prohibited

Excessive Contributions, 67 Fed.Reg. at 49,087). While it is true that “an administrative agency may be influenced by constitutional considerations in the way it interprets or applies statutes,”

Branch v. Federal Communications Commission,

824 F.2d 37, 47 (D.C.Cir.1987),

cert. denied,

485 U.S. 959 , 108 S.Ct. 1220 , 99 L.Ed.2d 421 (1988), the FEC’s duty to “allow the maximum of first amendment freedom of expression in political campaigns” must be exercised in a manner “commensurate with Congress’ regulatory aims,”

Common Cause v. Federal Election Commission,

842 F.2d 436, 448 (D.C.Cir.1988). The Court has already found that the FEC’s definition of the word “solicit” is ineongruent with Congress’s legislative purpose in enacting BCRA.

Moreover, as Plaintiffs point out, the Commission has already addressed the word “solicit” in other provisions of BCRA in a broader manner. Pls.’ Mem. at 36. For example, FECA provides that it is illegal for unions and corporations, or a separate segregated fund established by a corporation or a union, “to solicit contributions to such a fund” from any person other than, in the case of the corporation, its “stockholders and their families and its executive or administrative personnel and their families,” and in the case of the union, from “any person other than its members and their families.” 2 U.S.C. § 441b(b)(4)(A)(i)-(ii). In its 2001 Campaign Guide for Corporations and Labor

*80

Organizations, the FEC instructed that certain forms of communications could constitute solicitations even though they were not “straightforward request[s] for contributions ...FEC, Campaign Guide for Corporations and Labor Organizations 24 (2001) (Pls.’ Ex. 158). Plaintiffs also cite to numerous FEC Advisory Opinions where “the FEC has consistently held that ‘solicitation’ occurs when the corporation or union informs individuals from whom it may not solicit funds that the PAC may accept

unsolicited

contributions from them, encourages support for the PAC, facilitates contributions, or praises those who have contributed in a communication that is broadly distributed.” Pls.’ Mem. at 36 & n. 61.

Defendant does not address this point in its Opposition brief, except to argue that its past practices do not support Plaintiffs’ legislative reenactment doctrine arguments.

See Def.’s

Opp’n at 14-15

n. 26, 37-39. Nowhere does the Commission explain, either in its comments in the Federal Register, or its briefing before this Court, why constitutional concerns demand such a narrow definition of “solicit” under the nonfederal money regulations, but not under the eorpo-rate/union PAC regulations. Given this silence and the Commission’s apparent ability to define the word “solicit” in a broader way without creating vagueness concerns, the Court is confident that it can do so with regard to the nonfederal money regulations without running afoul of the Constitution.

The Court therefore finds that the Commission’s regulations defining the terms “solicit” and “direct” fail

Chevron

review.

b. Definition of “Agent”

BCRA’s prohibition on national political party committees’ involvement with nonfederal money extends to “agent[s] acting on behalf of such a national committee.” 2 U.S.C. § 441i(a)(2), (d). BCRA also prohibits “State, district, or local committee[s] of a political party (including an ... agent acting on behalf of such committee ...)” from expending or disbursing nonfederal funds on “Federal election activities].”

Id.

§ 441i(b)(1). “[A]gent[s] of a candidate or an individual holding Federal office,” are also generally barred from involvement with nonfederal money, and “agent[s]” of candidates for state or local office or individuals holding state or local office are also subject to restrictions regarding involvement with nonfederal money related to certain political communications.

Id.

§§ 441i(e)(1), (f)(1). BCRA did not define the term “agent,” Prohibited & Excessive Contributions, 67 Fed.Reg. at 49,082, but the FEC’s new regulations apply a definition for the term as it applies to the Commis sion’s nonfederal money regulations, 11 C.F.R. § 300.2 (b). The regulation begins by stating that “[f]or purposes of part 300 of chapter I, agent means any person who has actual authority, either express or implied, to engage in any of the following activities on behalf of the specified persons

_” Id.

In promulgating the new definition, the Commission made clear “that the definition of ‘agent’ is limited to those individuals who have actual authority, express or implied, to act on behalf of their principals and does not apply to individuals who do not have any actual authority to act on

*81

their behalf, but only ‘apparent authority’ to do so.” Prohibited & Excessive Contributions, 67 Fed.Reg. at 49,082. The FEC justified its exclusion of apparent authority from the definition, noting that

“[A]pparent authority to do an act is created as to a third party by written or spoken words or any other conduct of the principal which, reasonably interpreted, causes the third party to believe that the principal consents to have the act done on his behalf by the person purporting to act for him.” Restatement (Second) of Agency, 27. As has been noted by commenters, apparent authority is largely a concept created to protect innocent third parties who have suffered monetary damages as a result of reasonably relying on the representations of individuals who purported to have, but did not actually have, authority to act on behalf of principals. Unlike other legislative areas, such as consumer protection and anti-fraud legislation, BCRA does not affect individuals who have been defrauded or have suffered economic loss due to their detrimental reliance on unauthorized representations. Rather, the Commission interprets Title I of BCRA to use agency concepts to prevent evasion-or avoidance of certain prohibitions and restrictions by individuals who have actual authority and who do act on behalf of their principals. In this light, apparent authority concepts are not necessary to give effect to BCRA.

Id.

The Restatement defines “apparent authority” as “the power to affect the legal relations of another person by transactions with third persons, professedly as agent for the other, arising from and in accordance with the other’s manifestations to such third persons.” Restatement (Second) of Agency § 8 (1958). This concept is different from “authority,” which the Restatement defines as “the power of the agent to affect the legal relations of the principal by acts done in accordance with the principal’s manifestations of consent to him.”

Id.

§ 7.

This Circuit has explained that

“[a]pparent authority” exists where the principal engages in conduct that “reasonably interpreted, causes the third person to believe that the principal consents to have the act done on his behalf by the person purporting to act for him.” Restatement (Second) of Agency § 27 (1992). For there to be apparent authority, however, the third party must not only believe that the individual acts on behalf of the principal but, in addition, “either the principal must intend to cause the third person to believe that the agent is authorized to act for him, or he should realize that his conduct is likely to create such belief.”

Id.

at cmt. a.

Overnite Transp. Co. v. NLRB,

140 F.3d 259, 266 (D.C.Cir.1998).

Plaintiffs contend that the exclusion of agents acting with apparent, but not actual, authority “opens a gaping new loophole and sharply departs from general agency principles, governing case law, and the Commission’s own precedents.” Pls.’ Mem. at 42. Plaintiffs claim that the regulation violates

Chevron

step one, arguing that the definition runs contrary to Congress’s intent and the purposes behind

*82

BCRA.

Id.

at 43, 46. They also argue, in the alternative, that the regulation violates

Chevron

step two and “the APA’s requirements for a ‘reasoned analysis’ of the rule-making issues and evidence.”

Id.

at 47.

Again, in reviewing an agency’s regulation under step one of the

Chevron

analysis, the Court asks “whether Congress has directly spoken on the precise question at issue.”

Chevron, 467

U.S. at 842, 104 S.Ct. 2778 . The question here is whether or not Congress, in enacting BCRA, intended for the term “agent” to include those individuals acting with actual

and

apparent authority. Plaintiffs begin their argument that Congress had such intent by stating that “it is irrational to construe a statute designed to combat the

appearance

of corruption as leaving unregulated the acts of agents exercising

apparent

authority,” but offer no elaboration. Pls.’ Mem. at 43 (emphasis in original); Pls.’ Opp’n at 36 (same). The Court does not find the linguistic similarities between the phrases “appearance of corruption” and “apparent authority” provide any illumination on Congress’s intent with respect to the meaning of the word “agent.” As Defendant notes, Plaintiffs “do not explain how persons acting with apparent authority have had any special role in creating an appearance of corruption, and plaintiffs point to no evidence before the Commission that agents with apparent, but not actual, authority have contributed to this perception.” Def.’s Opp’n at 36.

Next Plaintiffs contend that the FEC “had consistently defined ‘agent’ to include those with apparent authority.” Pls.’ Mem. at 43-44. They cite to a former rule that had defined “agent” in connection with regulations defining independent expenditures to mean

any person who has actual oral or written authority, either express or implied, to make or to authorize the making of expenditures on behalf of a candidate, or means any person who has been placed in a position within the campaign organization where it would reasonably appear that in the ordinary course of campaign-related activities he or she may authorize expenditures.

11 C.F.R. § 109.1 (b)(5) (2001). They argue that given this background, it is clear that “Congress crafted new statutory provisions using ‘a well established term,’ which strongly suggests its intent for ‘the term to be construed in accordance with pre-existing regulatory interpretations.’ ” Pls.’ Mem. at 44 (quoting

Toyota Motor Mfg., Ky., Inc. v. Williams,

534 U.S. 184, 193-94 , 122 S.Ct. 681 , 151 L.Ed.2d 615 (2002)).

However, Plaintiffs have not provided any connection between Congress’s use of the term “agent” in Title I of BCRA and the FEC’s prior regulation con

*83

struing the term as it related to independent expenditures, nor have they established that the FEC’s construction of the term “agent” was well established. The Court does not find the fact that a 2001 regulation defined the term “agent” renders the term “well established.”

Plaintiffs also rely on the legislative reenactment doctrine. Pls.’ Mem at 17 & n. 31, 25, 36, 44. Given the Court’s prior discussion of this doctrine,

supra

at 60, and the fact that Plaintiffs have pointed the Court to nothing that indicates that Congress intended to have the FEC’s regulatory definition of “agent” apply to Title I of BCRA, the Court finds this argument lacks merit for the purposes of its

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step one analysis.

Next, Plaintiffs point out that the Supreme Court has held that it is “well established that ‘where Congress uses terms that have accumulated settled meaning under ... the common law, a court must infer, unless the statute otherwise dictates, that Congress means to incorporate the established meaning of these terms.’ ”

Community for Creative Non-Violence v. Reid,

490 U.S. 730, 739 , 109 S.Ct. 2166 , 104 L.Ed.2d 811 (1989); Pls.’ Mem. at 44. However, Plaintiffs provide no basis for the conclusion that the term “agent” has developed a “settled meaning under the common law,” or that the meaning includes those acting with apparent authority. Plaintiffs point out that the FEC

“admits

that ‘under the' common law of agency, an “agent’s authority may be actual or apparent.’ ” ”

Id.

at 44-45 (emphasis in original) (quoting Prohibited

Excessive Contributions, 67 Fed.Reg. at 49,082). This statement, however, does not support the notion that the common law definition of “agent” necessarily includes those acting with apparent authority. In fact, Black’s Law Dictionary provides that the term in its normal parlance does not include those acting with apparent authority, defining “agent” to mean “[o]ne who is authorized td act for or in place of another; a representative.” Black’s Law Dictionary 64 (7th ed.1999). Moreover, those acting with apparent authority are not- in fact agents; they are only treated as such in situations where they appear to be agents to third parties due in part to the “principal’s” manifestations to those third parties. Restatement (Second) Agency § 8;

see also

Pls.’ Mem. at 50.

The Commission responds that the Supreme Court in

Cisneros

also observed that “Courts of Appeals generally have interpreted similar notwithstanding language to supersede all other laws, stating that a clearer statement is difficult to imagine.”

Cisneros,

508 U.S. at 18 , 113 S.Ct. 1898 (internal quotation marks and punctuation omitted). “Accordingly, ... the Commission construed the ‘notwithstanding’ proviso as an exemption that allows candidates to ‘speak’ about raising money during [designated] fundraising events, despite the general restrictions on fundraising....” Def.’s Opp’n at 40. The Commission also asserts that the inclusion of the “notwithstanding” language demonstrates that “Congress must have seen a conflict between” Section (e)(3) and the general prohibition on nonfederal money solicitation.

Id.

at 41 . Moreover, it cites to the cross-references in the statute between the provisions banning certain non-federal money activities and Section (e)(3) as further “indication] that state or local party fundraising events are not governed by any such restrictions.”

Id.

at 41 .

After reviewing the parties’ arguments, the Court determines that the provision is ambiguous in that it can be read in more than one way.

Chevron,

467 U.S. at 842-43 , 104 S.Ct. 2778 ;

AFL-CIO,

333 F.3d at 174 . Read in the context of the other provisions of the Act, Section (e)(3) can be read to either be a carve-out for unabashed solicitation by federal candidates and officeholders at state, district or local

*90

Committee fundraising events, or to simply make clear that merely attending, speaking, or being the featured guest at such an event is not to be construed as constituting solicitation per se. While it is true that Congress created carve-outs for its general ban in other provisions of BCRA utilizing the term “solicit” or “solicitation,” see 2 U.S.C. § 441i(e)(2), (4), these provisions do not conflict with the FEC’s reading of Section (e)(3). Moreover, while these provisions may suggest that Section (e)(3) was not meant to be read as a complete carve-out in the context of certain fundraising events, they do not clearly bar such an interpretation. Given this ambiguity, the Court must conclude that the provision survives

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step one.

Turning to step two of the

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analysis, Plaintiffs contend that Congress’s statutory purpose would be seriously compromised by the Commission’s interpretation of the statute. Pls.’ Mem. at 50. The Supreme Court explained that Section (e)(3)’s

restrictions on solicitations are justified as valid anticircumvention measures. Large soft-money donations at a candidate’s or officeholder’s behest give rise to all of the same corruption concerns posed by contributions made directly to the candidate or officeholder. Though the candidate may not ultimately control how the funds are spent, the value of the donation to the candidate or officeholder is evident from the fact of the solicitation itself. Without some restriction on solicitations, federal candidates and officeholders could easily avoid FECA’s contribution limits by soliciting funds from large donors and restricted sources to like-minded organizations engaging in federal election activities. As the record demonstrates, even before the passage of BCRA, federal candidates and officeholders had already begun soliciting donations to state and local parties, as well as tax-exempt organizations, in order to help their own, as well as their party’s, electoral cause.

McConnell,

124 S.Ct. at 683 . Plaintiffs contend that Senator McCain made Congress’s intent clear when he stated on the Senate floor: “The rule here is simple: Federal candidates and officeholders cannot solicit soft money funds, funds that do not comply with Federal contribution limits and source prohibitions, for any party committee — national, State or local.” 148 Cong. Rec. S2139 (daily ed. Mar. 20, 2002) (statement of Sen. McCain); Pis.’ Mem. at 50-51. They note that the potential for abuse from the Commission’s regulation is

*91

exacerbated by the lack of any definition of what constitutes a “fundraising event for a State, district or local committee of a political party.” Thus, nothing prevents a federal candidate or officeholder from calling together a group of wealthy donors, labeling the gathering a “fund-raising event for a State, district, or a local committee of a political party,” and conducting unrestricted solicitation of soft money at such an event.

Pls.’ Mem. at 51 n. 84 (quoting 2 U.S.C. § 441i(e)(3)). Defendant responds that BCRA is not undermined whenever a federal candidate or officeholder solicits non-federal funds, because “BCRA itself provides for specific, albeit limited, opportunities for such fundraising.” Def.’s Opp’n at 42. Defendant is correct that Congress did provide for limited nonfederal fund-raising for federal candidates and officeholders, even on behalf of state and local political parties.

See 2

U.S.C. § 441i(e)(1)(B)(i);

McConnell,

124 S.Ct. at 682 n. 70.

This fact undermines to some extent Senator McCain’s statement about the purpose of the statute.

The Court cannot find on the current record that the Commission’s regulation on its face “unduly compromises the Act’s purposes” by “creating] the potential for gross abuse.”

Orloski,

795 F.2d at 164, 165 . To be sure, the Commission’s interpretation likely contravenes what Congress intended when it enacted the provision,

as well as what the Court views to be the more natural reading of the statute, but the record, with the exception of Senator McCain’s floor statement, is bare on this point. Moreover, while there can be little doubt that this provision creates the potential for abuse, it is unclear whether or not the potential for abuse and the degree to which the regulation compromises the Act reaches the level required by the

Orloski

decision to find that the regulation is entitled to no deference. In this respect, 11 C.F.R. § 300.64 (b) differs from the coordinated communication regulation which the Court found does unduly compromise FECA and creates the potential for gross abuse. The coordinated communications regulation, on its face, create an enormous loophole which runs contrary to the entire rationale for the special treatment of coordinated communications. For the state party fundraiser provision, the Court has no basis for making such a conclusion, given the dearth of precedent and guidance from the legislative history.

*92

Accordingly, the Court cannot find that the Commission has unduly compromised FECA’s purposes and, since Plaintiffs make no other

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step two arguments, finds that the regulation survives

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review.

Plaintiffs make one additional argument, claiming that the Commission’s analysis justifying its regulation “violates the standards of reasoned decisionmaking under the APA.” Pls.’ Mem. at 53. They attack the agency’s E & J, contending that the two grounds provided in support of the Commission’s regulation do not in fact support its regulation.

Id.

at 51. As noted

supra,

the Commission justified its regulation on two grounds: (1) “it was compelled by the plain language of the section and the structure of the section within BCRA;” and (2) a contrary reading would require the Commission to monitor what candidates and officeholders say at such events which would “raise serious constitutional concerns.” Prohibited & Excessive Contributions, 67 Fed.Reg. at 49,108. As de tailed

supra,

Plaintiffs argue that the Commission’s construction of the statute is not “compelled” by the language of the statute. As for the second rationale, Plaintiffs contend that this Court need not grant deference to the Commission’s constitutional analysis, and that in any event the justification is inadequate because the FEC “offered no explanation of why monitoring the speech of candidates and officeholders would be more difficult or intrusive at state party fundraising events than in other settings not controlled by the ‘total exemption.’ ” Pls.’ Mem. at 52. In response, the FEC explains why its construction of 2 U.S.C. § 441i(e)(3) is “reasonable,” but does not address its E & J comment that the interpretation was “compelled” by the terms of the statute. Def.’s Opp’n at 40-42. It is clear from the Court’s analysis,

supra,

that the FEC’s interpretation is not

mandated

by the terms of the Act. With regard to its second E & J rationale, the FEC notes that it is “charged with balancing ... competing public policies and should avoid creating constitutional problems.”

Id.

at 42. Nowhere, however, does it address Plaintiffs’ argument that such concerns are in any way more vexing in the context of state political party fundraisers than they are outside of such venues where nonfederal money solicitation is almost completely barred

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