Supplemental Appendix — McConnell v. Federal Election Commission

()

No. 02-1674 et al.

IN THE

Supreme Court of the United States

MITCH MCCONNELL et al.,

Appellants,

V.

FEDERAL ELECTION COMMISSION et ai.,

Appellees.

On Appeal From The United States

District Court For The District of Columbia

SUPPLEMENTAL APPENDIX

TO JURISDICTIONAL STATEMENTS

VOLUME III

FLOYD ABRAMS KENNETH W. STARR

SUSAN BUCKLEY Counsel of Record

BRIAN MARKLEY EDWARD W. WARREN

CAHILL GORDON & KANNON K. SHANMUGAM

REINDEL LLP KIRKLAND & ELLIS

80 Pine Street 655 Fifteenth Street, N.W.

New York, NY 10005 Washington, DC 20005

(212) 701-3000 (202) 879-5000

(additional counsel on inside cover)

June 2003

SS a a LS

WILSON-EPES PRINTING CO., INC. — (202) 789-0096 - WASHINGTON, D.C. 20001

KATHLEEN M. SULLIVAN

559 Nathan Abbott Way

Stanford, CA 94305

(650) 725-9875

JAN WITOLD BARAN

THOMAS W. KIRBY

LEE E. GOODMAN

WILEY, REIN & FIELDING LLP

1776 K Street, N.W.

Washington, DC 20006

(202) 719-7000

VALLE SIMMS DUTCHER

L. LYNN HOGUE

SOUTHEASTERN LEGAL FOUNDATION, INC.

3340 Peachtree Road, N.E.

Suite 3515

Atlanta, GA 30326

(404) 365-8500

G. HUNTER BATES

1215 Cliffwood Drive

Goshen, KY 40026

(502) 473-7557

Counsel in No. 02-1674

TABLE OF CONTENTS

Volume I

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Opinion of Judge Henderson..................ccccceceseseeseeeeeeee 160sa

Volume II

Opinion of Judge Kollar-Kotelly...............c.cccccccseseeeeee 479sa

Volume III

Opinion of Judge Kollar-Kotelly (continued) .............. 776sa

Volume IV

IT AT 1082sa

STITT ict iniasiininiciintictelibicneatenedteninanaisthidnniitacitjaines 1381sa

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Ill. CONCLUSIONS OF LAW

I find it most appropriate to discuss BCRA’s Title II first,

before turning to my discussion of Title I, and the other

remaining provisions of BCRA that are addressed in this

opinion.

I. Title Il: NONCANDIDATE CAMPAIGN

EXPENDITURES

Sections 201, 203 and 204: The Prohibition on Elec-

tioneering Communications

The McConnell, NRA, Chamber of Commerce, NAB, and

AFL-CIO Plaintiffs all challenge the prohibition on corporate

and labor disbursements for electioneering communications.

These Plaintiffs also challenge both definitions of

‘electioneering communication’ (the primary definition and

the fallback definition).

As discussed in the per curiam opinion, FECA Section

441b prohibits corporations and labor unions from using their

general treasury funds on contributions or expenditures in

connection with a federal election. 2 U.S.C. § 441b. Sections

203 and 204 of BCRA extend this prohibition to ‘elec-

tioneering communication.” BCRA provides for two

definitions of electioneering communication—a primary

definition and a backup definition to be substituted in the

event the main definition is held to be constitutionally infirm.

Given the uncontroverted record of abuse and circumvention

of the longstanding prohibition of Section 441b, I find the

primary definition of electioneering communication, and the

corresponding restrictions in sections 203 and 204,

constitutional. As a result, I find BCRA’s restriction on the

ability of corporations and labor unions to spend general

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treasury funds on electioneering eS to =

facially constitutional as a matter of _ oo a

application to section 5Ol(c)(4) and section 527(e

corporations that do not receive an MCFL exemption.

As my opinion on the constitutionality of the es

definition does not command a majority, I am cognizant at

the majority who have found the primary | ye

unconstitutional must tackle the constitutionality of , °

backup definition of electioneering communication. To t a

end, I concur in the judgment reached by Judge noon

opinion on this question. Accordingly, the final sg te

the three-judge District Court panel reflects my support of his

opinion as an alternative to my own finding that the —

definition of electioneering communication is constitutional.

Given my view of the constitutionality of the kage

definition, I have no further occasion to consider the

constitutionality of the backup definition.

A. Introduction

For close to one hundred years the political branches have

made the choice, consistent with the Constitution, that

individual voters have a right to select their federal officials

in elections that are free from the direct influence of

aggregated corporate treasury wealth and-for over fifty years-

free from the direct influence of aggregated labor union

treasury wealth. The rationale for the prohibition is simple,

persuasive, and longstanding. First, such a_ restriction

‘ensure[s] that substantial aggregations of wealth amassed "

the special advantages which go with the corporate form 0

organization should not be converted into political ‘war

chests’ which could be used to incur political debts —

legislators who are aided by the contributions.” FEC v. se

Right to Work Comm. (‘NRWC’), 459 US. 197, 207 (1982).

Second, such a prohibition ‘protect(s] the individuals[,] who

have paid money into a corporation or union for purposes

other than the support of candidates[,] from having that

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money used to support political candidates to whom they may

be opposed.’ /d. at 208. In other words, when corporations

and labor unions spend their general treasury funds to

influence federal elections, our coordinate branches have

Stated that they must use segregated funds voluntarily and

deliberately committed by individual citizens for that

purpose.

Since 1996, this longstanding prohibition has become a

fiction, with abuse so overt as to openly mock the intent of

the law. The record persuasively demonstrates that

corporations and unions routinely seek to influence the

outcome of federal elections with general treasury funds by

running broadcast advertisements that skirt the prohibition

contained in section 441b by simply avoiding Buckley's

‘magic words’ of express advocacy. In enacting Title II,

Congress responded to this problem by tightly focusing on

the main abuse: broadcast advertisements aired in close

proximity to a federal election that clearly identify a federal

candidate and are targeted to that candidate’s electorate. In

devising Title II, Congress has returned to a regime where

corporations and labor unions must use federal money from a

separate segregated fund explicitly designated for federal

election purposes when seeking to influence federal

elections.'

'” In this manner, Title I neatly dovetails with the nonfederal funds

prohibitions contained in Title I. Whereas the political parties have

expressed their frustration that Title I will diminish their importance

relative to special interest groups, see, e.g., RNC Br. at 13, Title II ensures

that these special interest organizations, except those explicitly qualifying

for MCFL-status, will have to run broadcast advertisements that influence

a federal election with the same federal dollars that the political parties

will have to use to pay for their advertisements (except that BCRA

increases the amount of federal money that the parties can raise relative to

their special interest counterparts).

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Indeed, the record conclusively establishes that the ‘magic

words’ of express advocacy identified in Buckley are rarely

used in any form of electioneering advertisements in the

modern political campaign. Findings § 2.3. The perverse

consequence of this situation is that advertisements that avoid

express advocacy are not only the type of advertisements that

political consultants generally employ for their candidate

clients, they are also precisely the advertisements that

corporations and labor unions, prior to BCRA, were permitted

to run. Accordingly, as the record demonstrates, corporations

and labor unions, with minimal effort, were able to influence

federal elections with their general treasury funds; a practice

long prohibited by Congress and contrary to that enforced by

the judiciary.

It is for these reasons, particularly given the overwhelming

record in this case, that I find facially constitutional the

prohibition in Title II on corporations and labor unions using

general treasury funds for electioneering communications.

B. Standard of Review

Plaintiffs first contend that both Buckley and MCFL

foreclose any Congressional regulation of speech that does

not constitute express advocacy, and as a result, Title II fails

as a matter of law because BCRA’s restrictions on

electioneering communication apply to broadcast adver-

tisements that do not contain express advocacy. McConnell

Br. at 51 (‘Buckley and MCFL condemn Congress’ regulation

of speech that does not constitute express advocacy.’). In

other words, Plaintiffs posit that the Court does not even need

to reach the question of whether BCRA is narrowly tailored

to serve a compelling governmental interest, because both

Buckley and MCFL announce a substantive rule of

constitutional law; namely, that Congress may not regulate

any speech that does not qualify as express advocacy as that

term has become known.

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As a matter of law, and as discussed infra, | find Plaintiffs’

argument on this point unpersuasive. Neither Buckley nor

MCFL create a rule of substantive constitutional law whereby

Congress can only regulate political speech containing words

of express advocacy. Rather, Buckley and MCFL used the

express advocacy standard as a means of construing

otherwise unconstitutionally vague portions of FECA. As I do

not view Buckley and MCFL as _ prohibiting future

Congressional regulation of political speech, I reach the

question of whether BCRA is narrowly tailored to serve a

compelling governmental interest.

In turning to that question, it bears pointing out that the

parties argue in their briefing about who bears the ‘burden’ in

this litigation, with each side pointing the finger at the other.

Compare Gov't Br: at 131 (‘[Plaintiffs] efforts to shoulder

[their] burden all fail.’) with McConnell Reply at 32

(‘Defendants incorrectly argue throughout their briefs that

plaintiffs bear the burden of demonstrating that BCRA’s ban

on electioneering communications is overly broad.’)

(emphasis in original). Throughout this litigation, Defendants

argue that Plaintiffs bear a burden of demonstrating that the

law is substantially overbroad. Defendants contend that as

Plaintiffs bring a facial challenge to these sections of BCRA,

they must establish that the prohibition on corporate and labor

union spending of general treasury funds on electioneering

communications is substantially overbroad. See Ashcroft v.

ACLU, 122 S.Ct. 1700, 1713 (2002); Ashcroft v. The Free

Speech Coalition, 122 S.Ct. 1389, 1398-99 (2002). As the

Supreme Court instructed in Broadrick v. Oklahoma, ‘the

Court has altered its traditional rules of standing to permit-in

the First Amendment area-attacks on overly broad statutes

with no requirement that the person making the attack

demonstrate that his own conduct could not be regulated by a

statute drawn with the requisite narrow specificity.’

Broadrick v. Oklahoma, 413 U.S. 601, 612 (1973) (internal

quotation marks and citation omitted).

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Plaintiffs wait until their reply briefs to address

Defendants’ salient argument on this point. McConnell Reply

at 32, Chamber/NAM Reply at 4-5. Plaintiffs essentially

argue that there are two kinds of facial challenges under the

First Amendment. The first, involves statutes that injure ‘third

parties,” and involves the Broadrick line of cases. Chamber

Reply at 4. The second facial attack is where ‘a plaintiff

invokes its own First Amendment rights in a way that

subjects a statute to strict scrutiny.’ Chamber/NAM Reply at

5 (citing R.A.V. v. City of St. Paul, 505 U.S. 377, 381 & n.3

(1992); Sec’y of State of Md. v. Joseph H. Munson, Co., 467

U.S. 947, 965-66 & n.13 (1984)). Plaintiffs argue that they

belong in this latter category.

The difficulty with Plaintiffs’ position, however, is that

none of their submissions describe in specific detail any

advertisements, referring to particular candidates in any races,

that Plaintiffs intend to produce or air at any time in the

future, and that would fall within BCRA’s. electioneering

communication provisions. As such, it is difficult to argue

that Plaintiffs have demonstrated affirmatively and

concretely, in any kind of detail, the scope of their claimed

First Amendment injuries.

Nevertheless, none of the parties dispute the fact that the

framework for reviewing the constitutionality of these

sections is strict scrutiny. Tr. at 252 (Waxman) (‘The

standard is strict scrutiny, there’s no doubt about it. This is

political speech. This is core political speech.’). Moreover, a

number of Plaintiffs do have a history of using corporate and

labor union general treasury funds to pay for electioneering

communications.

In practical terms, given the way Defendants have argued

this case, the debate over the ‘burden’ is largely academic.

Defendants present their Title II arguments by primarily

demonstrating that the law meets a strict scrutiny test. Indeed,

to some degree, Defendants have essentially conflated the

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strict scrutiny and substantial overbreadth inquiries. See Tr. at

251-52 (Waxman) (‘And that brings us to the real

constitutional issue, whether the burdens that Congress’ new

law imposes on speech are narrowly tailored to serve

compelling public interests; or, more precisely, again because

this is a_ facial challenge, whether plaintiffs have

demonstrated that the new provisions are substantially

overbroad in relation to their legitimate goals.’). Furthermore,

as I find that the provisions in Title II are constitutional under

this strict scrutiny review, the question of which party bears

the burden is also largely irrelevant. Consequently, although I

am convinced that Plaintiffs have not demonstrated that the

‘electioneering communication’ provisions in Title II are

substantially overbroad, I analyze the law under the

strictscrutiny framework consistent with Defendants’ presen-

tation in their briefing.

In undertaking this latter analysis, I will examine whether

BCRA’s restrictions on electioneering communications are

narrowly tailored to serve a compelling public interest. Under

this strict scrutiny review, I find that the restrictions on

corporate and labor union spending on _ electioneering

communications are constitutional at this facial challenge

stage, meaning that BCRA’s restrictions on political speech

are narrowly tailored to serve a corresponding compelling

governmental interest.

The remainder of my opinion on this question is divided

into four parts. The first section contains my reasons for

finding that express advocacy is not a constitutional

requirement. On this point, I am joined by Judge Leon and

therefore speak for the Court. The second portion provides

my dissenting view that the primary definition of

electioneering communication is narrowly tailored to serve a

compelling governmental interest. In the third and fourth

sections, I write for the Court and discuss my reasons for

concluding that Plaintiffs’ underbreadth argument and Plain-

tiffs’ challenge to the ‘media exemption’ both lack merit.

783sa

C. Express Electoral Advocacy is Not a Constitutional

Requirement

1. The Origins of the Express Advocacy Test

I conclude that in the context of regulating federal

elections, Congress may restrict corporate and union spending

on political speech which does not contain wc 1s of express

electoral advocacy, provided that such restrictions are

narrowly tailored to serve a compelling governmental

interest. In condemning Title II, Plaintiffs insist that Buckley

announced a substantive rule of constitutional law, such. that

Congress is forever prohibited from regulating any political

speech that does not contain explicit words of express

advocacy-even if the political speech being regulated is paid

for with corporate or labor union general treasury funds.

McConnell Opp’n at 38 (‘Buckley thus leaves no doubt that

its expressadvocacy test is a constitutional requirement.’).

Plaintiffs provide very little textual analysis of the Buckley

and MCFL decisions and instead overstate the extent of the

Buckley holding to satisfy their purpose.

In reviewing Title II, it should be noted that none of the

parties dispute the fact that the electioneering communication

restrictions in Title II regulate more political speech than just

express advocacy. Therefore, if I conclude that the express

advocacy standard is forever enshrined in the Constitution,

then the restrictions on electioneering communications in

Title II would be condemned as a matter of law before any

analysis of substantial overbreadth is even performed. In

taking a step back and analyzing Buckley and MCFL, it

becomes apparent, however, that the express advocacy

standard devised by the Supreme Court in Buckley is not a

substantive rule of constitutional law that operates as a per se

restriction on future Congressional action.

In Buckley, the Supreme Court considered a provision of

FECA that limited the amount of money individuals and

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certain groups could independently expend ‘relative to’ a

clearly identified federal candidate.''? See Buckley, 424 U.S.

at 39-51 (ciscussing section 608(e)(1) of FECA). Section

608(e)(1) of FECA provided that ‘[n]o person may make any

expenditure . . . relative to a clearly identified candidate

during a calendar year which, when added to all other

expenditures made by such person during the year advocating

the election or defeat of such candidate, exceeds $1,000.’ Id.

at 39 (omission in original) (emphasis added). Prior to

directly considering the constitutionality of section 608(e)(1),

the Supreme Court stated that ‘[b]efore examining the

interests advanced in support of [the provision’s] expenditure

ceiling, consideration must be given to appellants’ contention

that the provision is unconstitutionally vague.’ Id. at 40

(emphasis added).

In undertaking the vagueness inquiry, the Supreme Court

was particularly troubled by the phrase ‘relative to’ as it

appeared in the provision under consideration. /d. at 40-44.

Observing that the law did not define the phrase, the Supreme

Court found that ‘[t}he use of so indefinite a phrase as

‘relative to’ a candidate fails to clearly mark the boundary

between permissible and impermissible speech unless other

portions of [the provision] make sufficiently explicit the

range of expenditures covered by the limitation.’ /d. at 41-42.

Interpreting the phrase in its context, the Supreme Court

stated that the ‘context clearly permits, if indeed it does not

require, the phrase ‘relative to’ a candidate to be read to mean

‘advocating the election or defeat of’ a candidate.’ /d. at 42.

'!° More specifically, this provision in FECA ‘prohibit{ed] all indi-

viduals, who are neither candidates nor owners of institutional press

facilities and all groups, exvept political parties and campaign organi-

zations, from voicing their views ‘relative to a clearly identified candi-

date’ through means that entail aggregate expenditures of more than

$1,000 during a calendar year.’ Buckley, 424 U.S. at 39-40.

785sa

Accordingly, the Supreme Court, used the context of the

provision to make a ‘first-cut’ at construing the vague phrase

‘relative to.”

Even with this clarification, however, the Supreme Court

found that the vagueness inquiry was merely ‘refocuse[d]’’

and, thus, not completely resolved. /d. at 42. Confronted with

the challenge of interpreting ‘advocating the election or

defeat of a candidate’ the Supreme Court was once again

concerned about an interpretation of the wording of the

statute that covered more speech than was actually necessary.

The Supreme Court remarked that:

the distinction between discussion of issues and

candidates and advocacy of election or defeat of

candidates may often dissolve in practical application.

Candidates, especially incumbents, are intimately tied to

public issues involving legislative proposals and

governmental actions. Not only do candidates campaign

on the basis of their positions on various issues, but

campaigns themselves generate issues of public interest.

Id. In other words, the Supreme Court found that even if it

was permissible to construe the phrase ‘relative to’ as the

equivalent of ‘advocating the election or defeat of a

candidate,’ the vagueness inquiry was not complete because

such a construction did not provide a bright line between

permissible speech and impermissible speech and had the

potential to cause speakers to self censor genuine issue

discussion in order to avoid violating the statute.''!

''' The McConnell Plaintiffs seize on this quotation as immutable

proof that express advocacy is somehow chiseled in stone as a

constitutional requirement. McConnell Opp’n at 34 (Buckley's adoption

of this bright line test ‘was not merely an exercise in statutory

construction.’). However, as is clear from the context in which this

quotation was made, the Supreme Court in making this statement was

observing that the phrase ‘relative to’ could not be remedied by a simple

Pe Pat Ane et et A ge Ae ABCA BAD pi wn Ne

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In fact, to underscore its apprehension that its first

narrowing construction was not satisfactory, the Supreme

Court quoted a passage at length from Thomas v. Collins, 323

U.S. 516, 535 (1945):

[W]hether words iniended and designed to fall short of

invitation would miss that mark is a question both of

intent and of effect. No speaker, in such circumstances,

safely could assume that anything he might say upon the

general subject would not be understood by some as an

invitation. In short, the supposedly clear-cut distinction

between discussion, laudation, general advocacy, and

solicitation puts the speaker in these circumstances

wholly at the mercy of the varied understanding of his

hearers and consequently of whatever inference and be

drawn as to his intent and meaning.

Such a distinction offers no security for free dis-

cussion. In these conditions it blankets with uncertainty

whatever may be said. It compels the speaker to hedge

and trim.

Id. at 43 (quoting Thomas, 323 U.S. at 535). To satisfy its

concerns, therefore, the Supreme Court further construed

section 608(e)(1) to apply ‘only to expenditures for

communications that in express terms advocate the election or

defeat of a clearly identified candidate for federal office.’ /d.

at 44. In a footnote, the Supreme Court observed that ‘[t]his

construction would restrict the application of § 608(e)(1) to

communications containing express words of advocacy of

election or defeat, such as ‘vote for,’ ‘elect,’ ‘support,’ “cast

your ballot for,’ ‘Smith for Congress,’ ‘vote against,’ ‘defeat,’

‘reject.”’ Id. at 44 n. 52. These phrases have come to be

known as the ‘magic words,’ see Findings q 2.1.1, because

a communication that invokes one of these words

reference to the context of the provision, but rather, needed further

narrowing before the vagueness concerns would be ameliorated.

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unquestionably qualifies as express advocacy and falls within

the ambit of FECA. Notably, even with this narrowing

construction, the Supreme Court struck down section

608(e)(1) as unconstitutional under the First Amendment. See

id. at 44-51.

The Supreme Court also imported the ‘express advocacy’

requirement into another provision of FECA that it found

unconstitutionally vague. Section 434(e) of FECA required

individuals and certain groups to disclose contributions and

expenditures. Contributions and expenditures were each

defined in terms of the use of money or other valuable assets

‘for the purpose of influencing’ the nomination or election of

candidates for federal office. /d. at 77. The Supreme Court

found that the phrase ‘for the purpose of influencing’ was

unconstitutionally vague. /d. (‘It is the ambiguity of this

phrase that poses constitutional problems.’). Finding no

legislative history to help guide the statutory analysis, the

Court turned to construing the disclosure provision in such a

manner so as ‘to avoid the shoals of vagueness.”’ Id. at 78

(emphasis added).

When attempting to construe the phrase in relation to

expenditures, the Court encountered ‘line-drawing problems.’

Id. To resolve this difficulty, the Supreme Court, again,

interpreted the phrase in the same manner in which it had

interpreted the vague portion of section 608(e)(1). Id. at 79

(‘Although the phrase, ‘for the purpose of . . . influencing’ an

election or nomination, differs from the language used in

§ 608(e)(1), it shares the same potential for encompassing

both issue discussion and advocacy of a political result.’). As

a result, the Supreme Court found that ‘[t]o insure that the

reach of § 434(e) is not impermissibly broad, we construe

‘expenditure’ for purposes of that section in the same way we

construed the terms of s 608(e) to reach only funds used for

communications that expressly advocate the election or defeat

of a clearly identified candidate.’ Jd. at 80. So construed, the

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Supreme Court held that section 434(e) was narrowly tailored

to serve a sufficiently important governmental interest.

Id. at 80-82.

Ten years later in MCFL, the Supreme Court again invoked

the express advocacy test. MCFL, 479 U.S. at 248-49. In

doing so, the Supreme Court gave insight into the reasoning

behind the origins and purpose of the express advocacy test.

The MCFL Court wrote that in Buckley, ‘in order to avoid

problems of overbreadth, the Supreme Court held that the

term ‘expenditure’ encompassed ‘only funds used for

communications that expressly advocate the election or defeat

of a clearly identified candidate.’’ /d. (quoting Buckley, 424

U.S. at 80). With this in mind, the Supreme Court turned to

the question before it, which was whether the term

‘expenditure,’ as used in section 441b, was again vague.

Having found that Buckley had adopted the express advocacy

construction for the term ‘expenditure’ in the provision

requiring disclosure of independent expenditures, it is not

surprising that the Court found the term ‘expenditure’ for

purposes of section 441b to also require the express advocacy

construction. /d. at 249 (‘We agree with appellee that this

rationale requires a similar construction of the more intrusive

provision that directly regulates independent spending. We,

therefore, hold that an expenditure must constitute ‘express

advocacy’ in order to be subject to the prohibition of §

44 1b.’) (emphasis added).

2. The Express Advocacy Test is Not a Substantive Rule of

Constitutional Law

As is clear from the discussion above, both Buckley and

MCFL explicitly invoked the express advocacy test only as a

means of statutory construction. In Buckley, the Supreme

Court was confronted with two different provisions ef FECA

that both presented vagueness challenges for the Court. As a

result, the Supreme Court turned to the ‘‘cardinal principle’

of statutory interpretation ... that when an Act of Congress

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raises ‘a serious doubt’ as to its constitutionality, ‘this Court

will first ascertain whether a construction of the statute is

fairly possible by which the question may be avoided.’’

Zadvydas v. Davis, 533 U.S. 678, 689 (2001) (quoting

Crowell v. Benson, 285 U.S. 22, 62 (1932)); see also Frisby

v. Schultz, 487 U.S. 474, 483 (1988) (observing the ‘‘well-

established principle that statutes will be interpreted to avoid

constitutional difficulties’). I do not believe that in devising

the express advocacy standard, the Supreme Court in Buckley

was announcing an unalterable principle of constitutional law

that would prohibit future congressional action directed

toward express and issue advocacy. See Wisconsin Realtors

Ass'n v. Ponto, 233 F. Supp. 2d 1078, 1085 (W.D. Wis. 2002)

(‘I am not convinced that Buckley was intended to work such

a significant inhibition on future legislative efforts to address

problems raised by the competing state interests and

constitutional imperatives inevitably associated with express

and issue advocacy.’); Nat'l Fed’n of Republican Assemblies

v. United States, 218 F. Supp. 2d 1300, 1325 (S.D. Ala. 2002)

(‘The plaintiffs’ second error is their insistence that Buckley

held that all political speech other than express electoral

advocacy lies beyond the reach of constitutional regulation,

including disclosure requirements.’); see also Va. Soc’y for

HumanLife, Inc. v. FEC, 263 F.3d 379,392 (4th Cir. 2001)

(‘(W]e are bound by Buckley and MCFL, which strictly limit

the meaning of ‘express advocacy.’ If change is to come, it

must come from an imaginative Congress or from further

review by the Supreme Court.’). Rather, the Buckley Court ~

was particularly concerned with construing vague provisions

of a statute in order to avoid reaching difficult questions of

constitutional law. In the case of section 608(e)(1), the

Supreme Court was unsuccessful-even after construing the

statute in an effort to avoid vagueness problems, the provision

still failed to satisfy exacting First Amendment scrutiny.

Buckley, 424 U.S. at 44-45. Whereas, in the case of section

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434(e), the statutory construction successfully salvaged the

statute which, as narrowed, bore ‘a sufficient relationship to a

substantial governmental interest.’ /d. at 80.

The McConnell Plaintiffs argue that it is ‘unfathomable’

that Defendants would suggest the express advocacy test was

not constitutionally ordained. McConnell Opp’n at 35-36

(quoting Buckley, 424 U.S. at 80) (“To insure the reach of §

434(e) is not impermissibly broad, we construe ‘expenditure’

for purposes of that section in the same way we construed the

terms of § 608(e) to reach only funds used for com-

munications that expressly advocate the election or defeat of

a clearly identified candidate.’) (emphasis removed).

However, as the quoted language explicitly indicates, the

Supreme Court construed the statutory language in an effort

to save the provision from unconstitutional overbreadth. By

adopting a narrowing construction to this vague provision, the \

Supreme Court easily found section 434(e) constitutional.

Buckley, 424 U.S. at 80-82. Further diminishing the

credibility of the McConnell Plaintiffs’ argument is the fact

that the Buckley phrase quoted by the McConnell Plaintiffs

appears in the midst of a section the Supreme Court entitled

‘Vagueness Problems.’ /d. at 76.''7

'!2 The McConnell Plaintiffs also offer the argument that because

Buckley invoked First Amendment caselaw during its initial discussion of

‘General Principles,’ it was clear that Buckley was creating a rule of

substantive constitutional law when it articulated the express advocacy

standard. McConnell Opp’n at 37, McConnell Reply at 27 (citing Buckley,

424 U.S. at 14) (noting that Buckley cited Mills v. Alabama, 384 U.S. 214

(1966) and New York Times v. Sullivan, 376 U.S. 254 (1964)). However,

Plaintiffs fail to point out that these citations appear in the section

‘General Principles’’ and were cited for the uncontroversial proposition

that the ‘First Amendment affords the broadest protection to . . . political

expression.’ Buckley, 424 U.S. at 14 (emphasis added). It defies logic to

argue that because the Supreme Court invoked First Amendment caselaw

for the proposition that FECA’s restrictions on contributions and expen-

ditures operate in the area of the most fundamental First Amendment

79\sa

Accordingly, Plaintiffs’ reasoning is faulty when they

argue that the ‘express advocacy doctrine reflects more than a

concern about vagueness.” ACLU Opp’n at 4; accord

McConnell Opp’n at 37 (‘[I]t is nonsensical to read the

opinion as merely addressing statutory vagueness.’). In

adopting the express advocacy doctrine, the Supreme Court

was engaging in statutory construction in order to avoid

unnecessarily declaring specific portions of FECA

unconstitutional. In fact, nowhere in Buckley or MCFL does

the Supreme Court explicitly state that the express advocacy

test is a constitutional requirement. Each time the Supreme

Court has invoked the express advocacy standard it has done

so in the context of construing a vague portion of FECA. I

would expect that if the Supreme Court were announcing a

substantive rule of constitutional law it would have stated it

explicitly in either of these two cases.

Plaintiff ACLU takes a snippet of the Buckley opinion, and

without offering any textual analysis of the case, argues that

Buckley’s clear ruling is that ‘the government’s regulation of

expenditures can only reach ‘communications that in express

terms advocate the election or defeat of a clearly identified

candidate. .. .”” ACLU Br. at 13 (quoting Buckley, 424 U.S.

at 44). However, the Supreme Court stated in full: ‘We agree

that in order to preserve the provision against invalidation on

vagueness grounds, § 608(e)(1) must be construed to apply

only to expenditures for communications that in express

terms advocate the election or defeat of a clearly identified

candidate for federal office.’ Buckley, 424 U.S. at 44

(emphasis added). When the quoted portion appears in its full

context, it appears obvious the extent to which Plaintiff

ACLU has misconstrued Buckley’s words. The express

rights, that the Court was implicitly-thirty pages later-hewing express

advocacy into constitutional stone.

792sa

advocacy test in Buckley was merely an appropriate exercise

in statutory construction.''”

Plaintiffs are correct that the Buckley Court ‘did not posit a

bipolar world of issue advocacy and express advocacy.’

However, they err in concluding that the Supreme Court,

therefore, ‘permitted regulation only where it is unmistakably

clear that the speech at issue can only be characterized as

express advocacy.’ McConnell Br. at 49; see also ACLU Br.

at 15 (‘Only ‘express advocacy’ can be subject to regulation;

issue advocacy is free from permissible regulation.’). As

Judge Richard W. Vollmer recently observed:

The Supreme Court in Buckley employed no such

terminology and recognized no such dichotomy. Rather,

the Buckley Curt [sic] saw political speech as comprised

of ‘issue discussion’ and ‘advocacy of a political result.’

424 U.S. at 79. This would represent only a semantic

difference if ‘advocacy of a political result’ were

confined to express electoral advocacy, for then ‘issue

discussion’ would occupy the same territory that the

''3 Plaintiff ACLU also states that Title Il of BCRA applies to

advertisements ‘that merely ‘refer’ to a candidate’ and that, as a result,

Title II ‘should be struck down.’ ACLU Br. at 13. The ACLU’s argument

lacks merit because the primary definition of BCRA does not place a ‘ban

on communications that merely ‘refer’ to a candidate.’ ACLU Br. at 13.

Rather, BCRA prohibits corporations and labor unions from funding

broadcast advertisements with general treasury funds, which refer to a

federal candidate, run in close proximity to an election and are targeted to

the candidate's relevant electorate. Corporations and labor unions are, of

course, free to fund as many of these prohibited advertisements as they

desire from their separate segregated fund. I doubt anyone disputes the

proposition that had Congress enacted a law that had banned

communications that ‘merely ‘refer’ to a candidate’ that such a law would

be declared overbroad and unconstitutional. Jd. However, the restriction

related to electioneering communications in BCRA is much narrower than

Plaintiff ACLU describes in its briefing and is targeted to communications

that influence federal elections.

793sa

plaintiffs claim for ‘issue advocacy’—that is, all political

speech that is not express electoral advocacy.

The Buckley Court, however, recognized that

advocacy of a political result extends beyond express

electoral advocacy ... . The Buckley Court introduced

express electoral advocacy as a benchmark to provide

speakers the clear boundary that the statutory cap on

independent expenditures otherwise lacked. /d. at 43-44.

If express electoral advocacy were the only form of

electoral advocacy that exists, the Court would not have

been concerned that speakers could not tell the

difference between issue discussion and electoral

advocacy; the Court established the express electoral

advocacy standard precisely because other forms of

electoral advocacy exist but may prove difficult to

distinguish from issue discussion. . . .

Nat'l Fed’n of Republican Assemblies, 218 F. Supp. 2d at

1324 (emphasis added). Plaintiffs are mistaken in their

conclusion that in not establishing a ‘bipolar world,’ the

Supreme Court has necessarily decreed a rule of substantive

constitutional law. As Judge Vollmer points out:

Electoral advocacy is not automatically immune from

regulation but, to the extent it cannot easily be

distinguished from issue discussion, it may be necessary

to exclude electoral advocacy from regulation so as to

avoid self-censorship by uncertain speakers and the

resulting abridgement of issue discussion. The bright

line of express electoral advocacy was required under

Section 434(e), not because all speech falling short of

express electoral advocacy is immune from regulation,

but because no other means of readily distinguishing

electoral advocacy from issue discussion presented

itself.

Id. at 1328-29 (emphasis added). The point of Buckley and

MCFL was not that Congress can only regulate express

794sa

advocacy. Rather, the Supreme Court in these cases took a

vague Statute and construed it in such a manner so as to create

a bright line because the statute itself did not provide any

‘other means of readily distinguishing electoral advocacy

from issue discussion.’ /d. at 1329.

a. Other Cases Cited by Plaintiffs Are Not Relevant or Are

Distinguishable

Plaintiffs’ briefing, while heavy on hyperbole attacking

Defendants’ submissions, is incredibly light on textual

analysis of the Buckley and MCFL opinions. Perhaps

attempting to shift attention away from their lack of a robust

discussion of Buckley, Plaintiffs attempt to bolster their

position by citing to a series of lower court cases that

Plaintiffs claim uphold the express advocacy standard as a

rule of constitutional law. McConnell Br. 51-53. I

acknowledge that there is some dicta in these cases which

suggests that the express advocacy test is a constitutional

requirement. Nevertheless, the language in these cases is

dicta, is not binding precedent, and for the reasons discussed

in this section, is unpersuasive.

The cases cited by Plaintiffs fall mainly into two

categories. First, many of their cited cases involve courts

striking down FEC regulations attempting to broaden the

Supreme Court’s express advocacy standard. Not sur-

prisingly, courts rejected the FEC’s efforts because neither

they nor the Commission has the authority to redefine the

statutory test. These courts correctly observed that Congress

or the Supreme Court were the appropriate branches to

undertake such steps. BCRA is therefore consistent with this

strand of caselaw. The second grouping of cases involve

federal courts striking down state statutes and state

regulations that had a variety of constitutional defects. In

these cases, the state statutes at issue all captured too much

pure issue advocacy without fashioning an appropriate test

that predominantly regulated electoral advocacy. BCRA

795sa

differs from these state provisions in that with BCRA,

Congress, supported by a plethora of evidence and

experience, created a narrowly tailored definition of

electioneering communication that is specifically focused on

communications that influence federal elections.

With regard to the cases where courts struck down FEC

regulations, the Commission, and not Congress, had sought to

define express advocacy broader than the Supreme Court had

permitted in Buckley. See, e.g., Va. Soc’ y for Human Life, 263

F.3d at 385, 392 (striking down FEC regulation 11 C.F.R.

§ 100.22(b) that defined express advocacy in such a manner

so as to include communications that ‘could only be

interpreted by a reasonable person as containing advocacy of

the election or defeat of one or.more clearly identified

candidates’); Maine Right to Life Comm., Inc. v. FEC, 98

F.3d 1, 1 (1st Cir. 1996) (summarily affirming district court

decision to strike down same regulation); Right to Life of

Dutchess Cty., Inc. v. FEC, 6 F. Supp. 2d 248, 253 (S.D.N.Y.

1998) (striking down same regulation). In relation to this

broadly defined FEC regulation, these courts held that neither

they nor the FEC had the authority to change the express

advocacy test, concluding that to do so required further

congressional or Supreme Court action. In fact only one

decision concluded that the FEC could make such a

regulation, FEC v. Furgatch, 807 F.2d 857 (9th Cir. 1987), a

case that has been largely discredited. See, e.g., Chamber of

Commerce of the United States of America v. Moore, 288

F.2d 187, 194 (Sth Cir. 2002) (citing cases disagreeing with

Furgatch). In attempting to create these regulations, the

FEC’s efforts produced provisions plagued with vague terms

that raised the same concerns that troubled the Buckley Court,

placing the speaker at the mercy of the subjective intent of the

listener to determine if a communication was covered by

FECA. See Buckley, 424 U.S. at 43 (‘‘In short, the sup-

posedly clear-cut distinction between discussion, laudation,

general advocacy, and solicitation puts the speaker in these

796sa

circumstances wholly at the mercy of the varied

understanding of his hearers and consequently of whatever

inference may be drawn as to his intent and meaning.’’)

(quoting Thomas v. Collins, 323 U.S. 516, 535 (1945)).

Indeed, the consensus among the judiciary has been that

courts ‘are bound by Buckley and MCFL, which strictly limit

the meaning of ‘express advocacy.’ If change is to come, if

must come from an imaginative Congress or from further

review by the Supreme Court.’’ Va. Soc’y for Human Life,

263 F.3d at 392 (emphasis added).''* Unlike the present case,

the absence of further congressional action led these courts to

strike down the FEC’s regulation.

With regard to the second category of cases involving state

law provisions, Plaintiffs refer to these decisions solely in a

footnote. McConnell Br. at 53 n.20. These cited cases are

each distinguishable because the state laws and regulations

considered by the various courts each disregarded the

principles of vagueness and overbreadth articulated in

Buckley or reached too far in regulating issue advocacy. In

Chamber of Commerce, the Fifth Circuit pointed out that the

state statute at issue ‘essentially adopted the language of the

Supreme Court’s decisions in Buckley and MCFL (which

meant that the only decision that the court needed to reach

was] to determine whether the Chamber’s advertisements

constitute ‘express advocacy’ under the standard articulated

[in the state statute]." Chamber of Commerce, 288 F.3d at

196. Accordingly, for the court in Chamber of Commerce, the

only decision to reach was whether the communications at

issue in the case constituted express advocacy. There is some

unexplained dicta in the case which states that the ‘Supreme

Court has held that the First Amendment permits regulation

of political advertisements, but only if they expressly

''4 Other cases relied on by Plaintiffs concern other FEC regulations

relating to voter guides. Clifton v. FEC, 114 F.3d 1309, 1317 (Ist Cir.

1997); Faucher v. FEC, 928 F.2d 468, 472 (ist Cir. 1991).

797sa

advocate the election or defeat of a specific candidate.’ wn

190 (no citation provided). For the reasons articulated in :

section, I expressly disagree with such dicta, presente

without a thoroughgoing analysis of Buckley or any _

support. See Nat'l Fed’n of Republican Assembt"ies, ty

Supp. 2d at 1329-30 (citing Chamber of Commerce) ( -

some of these cases contain unexplained dicta argua y

suggesting that express electoral advocacy is a universal,

constitutional limitation on disclosure requirements, sap

holds and none offers any textual analysis of Buckley that

could support such a proposition..’). | |

In another case cited by Plaintiffs, North Carolina Right od

Life, Inc. v. Bartlett, the Fourth Circuit invalidated a —

Carolina statute requiring political committees to make

certain disclosures. North Carolina Right to Life, td v.

Bartlett, 168 F.3d 705, 712-713 (4th Cir. 1999). The Bart ett

court found ‘unconstitutionally vague and overbroad a state

statute that reached further than FECA in mn

disclosure requirements to (1) groups that only incidenta y

engage in express advocacy and (2) groups — in —

advocacy. Id. In the same breath as it struck ae

provision, the Fourth Circuit made clear that it would have

first endeavored to save the provision like the Supreme Court

did in Buckley. Id. at 712 (‘The question then is whether

may similarly construe North Carolina's definition bs

political committee to save it from being void oa

vagueness.”). The court in Bartlett, therefore, only found hat

the North Carolina statute was not subject to a narrowing

interpretation, not that the express advocacy test was Ba

permanent fixture of constitutional law. However, to Z

extent some language in Bartlett could arguably lead in that

798sa

direction, I find it to be dicta unaccompanied by a serious

textual analysis of Buckley,''®

Plaintiffs also cite Citizens for Responsible Government

State Political Action Committee v. Davidson, a case where

the Tenth Circuit severed unconstitutional portions of a

Colorado campaign finance law. The state law defined

independent expenditure to include not only express

advocacy, but also ‘expenditures for political messages which

unambiguously refer to any specific public office or candidate

for such office.’ Citizens for Responsible Gov't State Political

Action Comm. v. Davidson, 236 F.3d 1174, 1187-88 (10th

Cir. 2000). The term ‘political message’ was in turn defined

as including messages delivered by telephone, by print or

electronic media, or by any other written material that applied

not only to express advocacy, but also to unambiguous

references to candidates. Jd. at 1188. The Davidson court

found that as applied to the plaintiffs, the law encroached on

legitimate issue advocacy, which ‘is a violation of the rule

enunciated in Buckley and its progeny.’ Jd. at 1194 (quoting

Vermont Right to Life Comm., Inc. v. Sorrell, 221 F.3d 376,

387 (2d Cir. 2000)). From the plain text of the Colorado

statutes, the laws were aimed not just at electioneering, but

also at pure issue discussion. No effort was made to draw a

'"> Indeed in distinguishing Bartlett, the court in National Federation

of Republican Assemblies found:

Only a single case cited by the plaintiffs Clearly stands for the

Proposition asserted. In North Carolina Right to Life, Inc. vy.

Bartlett, 168 F.3d 705 (4th Cir. 1999), cert. denied, 528 U.S. 1153

(2000), the Court stated that Buckley ‘defined political committee

as including only those entities that have as a major purpose

engaging in express advocacy in support of a candidate.’ /d. at 712

(emphasis in original). The Court offered no authority for this

proposition, which is plainly contrary to Buckley and which is dicta

in any event.

Nat'l Fed’n of Republican Assemblies, 218 F. Supp. 2d at 1330 (footnotes

omitted).

_ 799sa

different line than had been drawn in Buckley, and as a result,

the Tenth Circuit severed those constitutionally —c

portions. Davidson also contains unexplained dicta ot t :

{Supreme Court in MCFL] clarified that express wor S z

advocacy were not simply a helpful way to identify hogy

advocacy,’ but that the inclusion of such words ye

constitutionally required.’ /d. at 1187. For the nan rena :

forth above, I disagree with this statement, and consider |

constitute unpersuasive dicta.

The other cases Plaintiffs cite are equally ig eee

lowa Right to Life Comm., Inc. v. Williams, 187 F.3 oe

968-970 (8th Cir. 1999) (striking down a state = a “es

defining express advocacy in a similar manner as l ze

§ 100.22(b) as unconstitutional because the mar 0 ha

regulation is on ‘what reasonable people or reasonable ."

would understand fy the communication ); ageing

Patrons Affecting Change v. Baldwin, 1999 USS. are ms

23325 at *5-*6 (7th Cir. 1999) (upholding Indiana ape 0

statute after Indiana Supreme Court certified e S oe

applied only to organizations engaging in express a a :

Indeed, the court in Jowa Right to Life grounded - ve

on the fact that the ‘State’s definition of express eer

creates uncertainty and potentially chills discussion of public

issues.’ Jowa Right to Life, 187 F.3d at 970.

After reviewing these cases, I am convinced that cone

the cases cited above offer a convincing ogy * -

express advocacy is a constitutional requirement. : be s ;

and subjective terms associated with the provisions ph

impelled the Buckley court to offer the — a ~ y

construction. In turning to BCRA, it is clear that the pri my

definition of electioneering communication does not prese

this problem.

800sa

3. The Primary Definition of Electioneering Communi-

cation is Not Vague

Unlike the vagueness concerns which motivated the

Supreme Court in Buckley and MCFL, the primary definition

of electioneering communication is not vague. Indeed, none

of the Plaintiffs argued in their briefing or at oral argument

that the primary definition presented any vagueness concerns.

See McConnell Br. at 57-69: Tr. at 264-65 (Waxman) (‘No

one is arguing—I don’t believethat any of the 82 plaintiffs in

this case argue that the principal definition that is the four-

part test, is vague in any respect. It’s hard to imagine how it

could be less vague.’) (none of the Plaintiffs ever objected to

this characterization). In other words, there is no vagueness

challenge to the primary definition presently before the Court.

Plaintiffs make a number of general arguments in

Opposition to the primary definition: first, they contend that

the primary definition fails because it regulates more speech

than express advocacy, McConnell Br. at 44-57: second, they

argue that even if express advocacy is not a constitutional

requirement, the primary definition is unconstitutionally

overbroad, McConnell Br. at 57-69; third, they argue that the

primary definition of electioneering communications is

‘woefully’ underinclusive, McConnell Br. at 75-77; and

fourth, they argue that the primary definition violates the

Fifth Amendment, McConnell Br. at 77-81. Nowhere,

however, do any of the Plaintiffs argue that the primary

definition is vague. Given that among all of the seasoned

political actors and organizations that comprise the remaining

77 Plaintiffs in this case, not one has argued that vagueness is

a problem plaguing the primary definition, I could decline to

engage in a vagueness inquiry. See, e.g., Tri-State Hosp.

Supply Corp. v. United States, 142 F. Supp. 2d 93, 101 n.6

(D.D.C. 2001) (‘The court makes no ruling on such acts,

however, because the United States has not briefed the

issue.’); Carter v. Cleland, 472 F. Supp. 985, 989 n.4 (D.D.C.

80lsa

1979) (‘This issue was not briefed by the parties. No —

will be rendered on it.”); cf. Kattan v. District of Colum a

995 F.2d 274, 276 (D.C. Cir. 1993) (‘[T]his Court

recognized that a losing party may not use a Rule 59 “me

to raise new issues that could have been raised =~ - :

United States v. Wade, 255 F.3d 833, 839 (D.C. Cir. -

(issues that are not briefed are considered ae a

(citing Terry v. Reno, 101 F.3d 1412, 1415 (D.C. Cir. ),

cert. denied, 520 U.S. 1264 (1997)).

However, since Judge Henderson discusses the as

question in her opinion, see Henderson Op. at Part IV.A,

note that even were I to entertain the vagueness question,

would conclude that the primary definition of oe

communication is free from any vagueness infirmities. so

primary definition of electioneering ease wang a

forth in section 201 of the Act, comprises four ~y

elements, each designed to be clear, objective, limited in

scope, and directly responsive to the evidence —

recent electioneering by corporations and labor — w :

their general treasury funds. An advertisement falls in .

definition, and therefore would have to be funded wit “ye y

from a labor union or corporation’s segregated one, if, an

only if, it satisfies each of the following four elements:

A. It is broadcast by television, radio, cable, or a

Newspaper advertisements, direct mail, oe S,

phone banks, Internet advertisements, door-to- oor

canvassing, or leaflets are not covered by the primary

definition.

B. It refers to a ‘clearly identified candidate’ for federal

office. Broadcast advertisements dealing with issues are

not electioneering communications, unless the advertiser

Ol

P 802sa

chooses to mention or show a_particular federal

candidate.''®

C. It runs in the 60 days before a general election, or the

30 days before a primary.

D. The advertisement is targeted to the identified

candidate’s electorate. Specifically, the advertisement

must reach at least 50,000 voters in a relevant state or

district.

BCRA § 201(a); FECA § 304(f)(3)(A); 2 U.S.C.

§ 434(f)(3)(A); see also Def.- Int. Br. atl10. In a case

construing a new Wisconsin statutory provision very similar

to the primary definition of ‘electioneering communication,’

Chief Judge Barbara B. Crabb makes the compelling point

that the Wisconsin statute at issue in that case actually posed

less of a vagueness problem than the express advocacy

standard identified in Buckley:

Whatever the potential constitutional flaws of

Wisconsin’s new reporting and disclosure scheme,

vagueness does not appear to be one of them. In fact, the

State legislature’s approach appears to draw a line even

brighter than the one established in Buckley. The law

makes clear that once a certain dollar threshold is

''® The language in the statute, ‘refers to a clearly identified candidate

for Federal office,” BCRA § 201(a); FECA § 304(f)(3)(A):; 2 U.S.C.

§ 434(f)(3)(A), does not suffer the same problems that the Buckley court

had with FECA’s ‘relative to’ language. Although, the definition of ‘refer’

Shares ‘relate’ as a synonym, ‘refer’ is a much moreprecise word.

Merriam- Webster's Collegiate Dictionary, Tenth Edition 1997 (defining

refer as ‘1 a: to have relation or connection: RELATE b: to direct

attention usu. by clear and specific mention.’’) (emphasis added). Given

that ‘refers to’ is a much more exacting word than ‘relative to,’ and given

that none of the Plaintiffs have complained that there is any ambiguity

with this wording, I find that this phrase does not suffer from the same

vagueness problems that plagued FECA when the Buckley court construed

the phrase ‘relative to.’

803sa

sed, the law’s disclosure requirements apply to

= mune referring to a clearly identified

candidate that appears within 60 days of an election. A

copy of a proposed advertisement and a calendar are all

that is necessary to make a _ conclusive advance

determination that the ad is subject to regulation. By

contrast, the Buckley approach to express advocacy still

leaves room for a degree of uncertainty because, as

plaintiffs concede, the list of words and phrases

identified in that opinion as constituting express

advocacy is illustrative, rather [than] exhaustive.

Therefore, in a later case involving the federal statute at

issue in Buckley, the Court noted that the definition of

express advocacy it adopted in Buckley would also cover

a communication whose message ‘is marginally less

direct than ‘Vote for Smith.” Federal Election

Commission v. Massachusetts Citizens for Life, Inc., 479

U.S. 238, 249 (1986). Just how ‘direct’ an exhortation

must be to qualify as express advocacy under Buckley is

not free of all uncertainty for would-be political

advertisers.

Wisconsin Realtors, 233 F. Supp. 2d at 1086 ne age

added). The same could be said of the primary definition oO

electioneering communication in BCRA. ee my

communication is more certain and more explicitly define

than Buckley’s and MCFL’s explanation of express ——-

in that it provides objective criteria for potential politic

communicators to follow. Although there is no exhaustive list

of words falling under the rubric of express advocacy, the

electioneering communication definition is precise as to cy

communications are encompassed by its terms. According y;

I find none of the vagueness concerns identified by =

Buckley Court present with regard to the primary definition o

electioneering communication.

ee eae

—_—_o

804sa

D. The Evisceration of Section 441b

1. Introduction

As discussed in the foregoing section, the Supreme Court

in Buckley and MCFL construed FECA’s restrictions on

independent expenditures to apply only to expenditures

containing words of ‘express advocacy.’ While the Supreme

Court was prescient in observing that such a construction

with regard to limits on an individual's independent

expenditures was bound to create loopholes in the regulatory

system, Buckley, 424 U.S. at 45 (‘It would naively

underestimate the ingenuity and resourcefulness of persons

and groups desiring to buy influence to delieve that they

would have much difficulty devising expenditures that skirted

the restriction on express advocacy of election or defeat but

nevertheless benefitted the candidate’s campaign.’), the

Supreme Court emphasized in Buckley that it was without a

record to uphold restrictions that went beyond express

advocacy, id. at 46 (‘[T]he provision does not presently

appear to pose dangers of real or apparent corruption

comparable to those identified with large campaign

contributions.’) (emphasis added). In keeping with our system

of constitutional checks and balances, the Supreme Court

effectively sent the issue back to the political branches for

further consideration. The Supreme Court, in my view, never

conclusively foreclosed reconsideration of a limitation on

independent expenditures, provided that such a restriction

was not vague and was supported by an adequate record.

Indeed, in the context of restricting corporate and labor union

independent expenditures, the Supreme Court, after Buckley,

explicitly left this door open. See First Nat'l. Bank of Boston

v. Bellotti, 435 U.S. 765, 788 n.26 (1978) (‘Congress might

well be able to demonstrate the existence of a danger of real

Or apparent corruption in independent expenditures by

corporations to influence candidate elections.”).

ooo

=)

805sa

The instant case presents such a record to the three-judge

District Court and also demonstrates the wisdom of then-

Justice Rehnquist’s observation that the ‘carefullegislative

adjustment of the federal electoral laws, in a cautious

advance, step by step, to account for the particular legal and

economic attributes of corporations and labor organizations

warrants considerable deference.” NRWC, 459 U.S. at 209

(internal citation and quotation marks omitted). Since 1996,

corporations and labor unions have used their general treasury

funds to influence federal elections in direct contravention of

the original intent of Section 441b and its statutory

predecessors. Congress responded to this problem by enacting

Sections 201, 203, and 204 of BCRA. Therefore, before

turning to a discussion of whether these sections of BCRA are

narrowly tailored, I shall briefly discuss the erosion of the

express advocacy test as a means of distinguishing between

electoral advocacy and issue discussion. The Findings of Fact

demonstrate that Congress correctly observed that Section

441b was no longer effective at preventing corporations and

labor unions from using their general treasury funds to

influence federal elections. Indeed, to quote a former NRA

official, the state of the Section 441b prohibition prior to

BCRA was ‘built of the same sturdy material as the

emperor’s clothing.’ Findings § 2.4.3 (Metaksa).

The Findings of Fact with regard to the evisceration of

Section 441b resemble a mosaic with each piece of evidence

building on the next, and when viewed as a whole, present a

damaging portrait of corporations and labor unions using their

general treasury funds to directly influence federal elections.

It is to this picture that I now turn.

2. The Rise of Spending on Issue Advocacy in Close

Proximity to Federal Elections

As discussed supra, in MCFL, the Supreme Court

construed the prohibition on expenditures in section “Alb as

only applying to expenditures containing words of ‘express

806sa

advocacy.’ MCFL, 479 U.S. at 249 (‘We therefore hold that

an expenditure must constitute ‘express advocacy’ in order to

be subject to the prohibition of § 441b.’). As a result of

MCFL, corporations and labor unions were permitted to use

their general treasury funds on independent expenditures in

connection with a federal election, provided that those

independent expenditures did not contain words of “express

advocacy.’ In other words, so long as corporations and labor

unions did not use any of Buckley’s ‘magic words’ in their

advertisement, they could use their general treasury funds to

pay for advertisements that influenced a federal election. Of

course, if the corporation or labor union chose to use the

magic words in an advertisement, it could still do SO,

provided it paid for such a communication from a segregated

fund, thereby ensuring that there was political support for the

advertisement.

As a consequence of the Supreme Court’s decision in

MCFL, candidate-centered issue advertisements,''” funded

with corporate and labor union general treasury funds, has

dramatically increased in recent election cycles. Findings

{ 2.2. “By the early 1990s and especially by 1996, interest

groups had developed a strategy to effectively communicate

an electioneering message for or against a particular

candidate without using the magic words and thus avoid

disclosure requirements, contribution limits and source

limits.’ Id. § 2.2.7 (Magleby).'"* The 2001 Annenberg

'” As the Findings demonstrate, issue advertisements generally fall

into three categories: candidate-centered, legislation-centered, and general

image-centered. Findings § 2.2.2. Candidate-centered advertisements

make a case for or against a candidate but do so without using ‘magic

words.” /d. These are the advertisements that BCRA seeks to distinguish

from other forms of issue advocacy.

"’ The reason why it was not until 1996 that this explosion in

candidate-centered issue advocacy occurred, as political consultant Bailey

explains, was that in post-Watergate campaigns, it was important for

candidates to be seen as attempting to clean up the political process.

807sa

Report, relied on by Defendants, Plaintiffs, and Congress,

establishes that during the 1996 election cycle, an estimated

$135 million to $150 million was spent on multiple

broadcasts of about 100 distinct advertisements, in the LU 997-

1998 election cycle, 77 organizations aired 423 distinct

advertisements at a cost of between $250 million and $340

million,''? and in the 1999-2000 election cycle, 130 groups

spent over an estimated $500 million on 1,100 distinct

advertisements. /d. § 2.2.4.'*” Plaintiffs’ own expert readily

concedes that the number of organizations sponsoring issue

advertisements has “exploded” over the last three election

cycles. Id. § 2.2.6 (La Raja).'?! From their studies, the

“adi ‘ k of enforcement and a

Findings § 2.2.7 (observing that ‘due to a lac adhe

aia on the part of some to win at s advocacy into constitutional

stone.

9 The report the Annenberg Study produced following the 1997- 1998

election cycle placed this estimate at between $275 million to $340

million. See supra note 78.

20 As a representative sample, the Annenberg Report 2001 found that

in the 2000 election cycle, the Republican and Democratic parties

accounted for almost $162 million (31%) of this spending on issue

advocacy, Citizens for Better Medicare, $65 million (13%), Coalition °

Protect America’s Health Care, $30 million (6%), US. Chamber oO

Commerce, $25.5 million (5%), AFL-CIO, $21.1 million (4%), National

Rifle Association, $20 million (4%), U.S. Term Limits, $20 million (4%).

Findings § 2.2.4. | |

21 Interestingly, the huge rise in issue advocacy spending aap

federal campaigns far outpaces spending on the amount of PA -

‘sponsored advertising. Under the original intent of FECA, corporations

and labor unions that wished to sponsor electioncering advertisements

would have had to do so with segregated funds (e.g. PAC money”).

2 U.S.C. § 441b(b)(2)(C). During the 2000 election cycle, non-PAC

interest groups ran 74,024 political advertisements referring to a federal

candidate, while PAC interest groups ran only ; 3,663 advertisements.

Findings § 2.2.5.2. Although none of the parties discuss this discrepancy,

and although there are likely a number of factors to explain it, it does

take much imagination to conclude that one of the primary reasons

PAC advertising is so low in comparison, is that if a corporation or labor

808sa

Annenberg Public Policy Center concludes that the amount of

money spent on “issue advocacy” is increasing rapidly, that

this development permits the political parties, corporations,

and labor unions to gain a “louder” voice, and that

consequently, the “distinction between issue advocacy and

express advocacy is a fiction.” /d. Indeed, even the political

parties recognize the value which these outside corporations

and labor unions bring to the election with their issue

advocacy. /d. § 2.7.10.

3. “Magic Words” Are Rarely Used in Political

Advertisements

As issue advocacy by corporations and labor unions has

grown as a means of influencing federal elections, the trend

of all forms of political advertisements has been to move

away from words of express advocacy-whether they are

advertisements produced by candidates, political parties, or

corporations and labor unions. Findings § 2.3. The unrebutted

expert testimony demonstrates that only 11.4 percent of

advertisements purchased by federal candidates that aired

during the 2000 election cycle would qualify as

electioneering under the “magic words” test. /d. q 2.3.1

(Goldstein); see also id. § 2.3.2 (Strother) (observing that

90% of candidate advertisements he has put together in his

career have not used express advocacy). Moreover, the

uncontroverted testimony of political consultants establishes

that express advocacy is no longer considered an effective

tool of political advertising. /d. (Strother) (“Good media

consultants never tell people to vote for Senator X; rather,

you make your case and let the voters come to their own

conclusions. In my experience, it actually proves less

union can fund the most effective form of electioneering with general

treasury funds, there is no need to try and raise PAC money or comply

with PACs’ disclosure provisions simply to run_ electioneering

advertisements that use words of “express advocacy.”

809sa

effective to instruct viewevs what you want them to do.”);

(Bailey) (“In the modern world of 30 second political

advertisements, it is rarely advisable to use such clumsy

words as ‘vote for’ or ‘vote against.”*). When Buckley was

handed down, express advocacy in political advertising was

more common. /d. (Bailey). Since the mid-1980s, political

advertising has shifted and today the practices of political

advertisers-with only a znere 30 seconds to convey their

messages-parallel commercial advertisers where a “product is

presented in various desirable tableaus vee present[ing}

viewers with a variety of reasons to choose their product.” /d.

q 2.3.3 (Krasno and Sorauf) (“Political ads seem to follow the

same strategy, hoping that citizens will grow to prefer a

candidate without being told to troop to the polls.”).

4. Other Advantages of Using Issue Advocacy to

Influence Federal Elections

Aside from the fact that candidate-centered issue advocacy

is a much more powerful means to convey an electioneering

message, it is uncontroverted there are other strong incentives

for using “issue advocacy” to influence federal elections. Id. q

2.5. First, by running “issue advertisements” in the immediate

run-up to a federal election, corporations and unions are able

to avoid any of the disclosure requirements that ordinarily

‘attach when these groups use general treasury funds to

influence federal elections. /d.; id. | 2.5.1. Plaintiffs’ Experts

Milkis and La Raja equally concur that the rise of issue

advocacy has permitted issue organizations to hide their true

identities while running these advertisements. /d. { 2.5.1

(Milkis); § 2.2.6 (La Raja) (“Over the last three election

cycles, the number of groups sponsoring ads has exploded,

and consumers often don’t know who these groups are, who

funds them, and whom they represent.”). As Plaintiffs’ expert

_ Milkis candidly observes, “For example, The Citizens for

Better Medicare, which spent $65 million on television ads

[during the 2000 election cycle], is funded primarily by the

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pharmaceutical industry.” Jd. | 2.5.1: see also id. (citing

example of AFL-CIO running advertisements in

congressional race under the name “Coalition to Make Our

Voices Heard”); id. (“Frankly we’ve taken a page out of their

book [other interest groups] because in some places it’s much

more effective to run an ad by the ‘Coalition to Make Our

Voices Heard’ than it is to say paid for by ‘the men and

women of the AFL-CIO.”’) (Magleby) (citing comments of

AFL-CIO representative at a lunchtime discussion panel at

the Pew Press Conference). As a result, not only are

corporations and unions able to fund the most effective form

of political advertising with their general treasury funds, but

they are able to create corporations which have euphemistic

names and which, in many instances, serve as fronts for

injecting corporate general treasury funds into federal

elections. /d. In addition to avoiding FECA’s disclosure

requirements, it is uncontroverted that another advantage of

running election advertisements as “issue advocacy” is that

corporations and labor unions can use their general treasury

funds to influence federal elections which, as Defense Expert

Magleby observes, “makes a sham of these longstanding

federal laws.” Jd. 4 2.5.2. The uncontroverted testimony of

Defense Expert Magleby also makes clear that by avoiding

PACs, these organizations can raise larger amounts of funds

more quickly than if they had to raise money to pay for their

advertisements using PACs. /d. § 2.5.3.

5. The Impact of These Developments

Accordingly, when the Supreme Court’s construction of

Section 441b in MCFL is combined with the fact that very

few political advertisements use words of express advocacy,

the result is obvious: corporations and labor unions, long

prohibited from using their general treasury funds to

influence federal elections, are able to run the most effective

form of political advertising and the most widely used form

of political advertising from their general coffers. At the same

8lisa

time, the law constitutionally prohibits corporations and labor

unions from using general treasury funds to influence federal

elections with advertisements that use express words of

advocacy-a style of advertising rarely used and described 7

political consultants as ineffective. The unintended result :

this development is that the longstar:ting prohibition on the

use of corporate and labor union general treasuries to

influence federal elections is undermined. Indeed, the role of

corporations and labor unions in federal elections 1s actually

enhanced because these corporations and labor unions are

able to fund the most potent form of political advertising

using treasury funds.

The testimony from political consultants, experts, and

officeholders and candidates convincingly bears this point

out. The record demonstrates that the express advocacy test Is

not a useful benchmark for distinguishing between campaign

advertising and issue advertising, that no particular words oa

necessary to create electioneering advertisements, and that

corporations and labor unions produce advertisements that

directly influence federal elections under the guise of “issue

advocacy.” Id. 2.4. Despite the fact that MCFL interpreted

Section 441b as reaching more advocacy than the examples in

Buckley's footnote 52, MCFL, 479 U.S. at 249, the test has

proven ineffective at distinguishing between genuine issue

advocacy and electioneering paid for with corporate and labor

union general treasury funds. Indeed, as the testimony

presented in this case convincingly demonstrates, no

particular words of advocacy are Necessary for effective

campaign advertisements; it is easier for corporations and

labor unions to skirt the prohibition contained in Section

441b. In sum, Congress found that the express advocacy test,

grafted onto Section 441b by the MCFL Court, was no longer

preventing corporations and ‘abor unions from spending

general treasury funds on fede ‘al elections. Findings { 2.4.4.

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6. Corporations and Labor Unions Routinely Spend

General Treasury Funds on Advertisements Designed to

Influence Federal Elections

a. Political Consultants Testify that Candidate-Centered

Issue Advertisements are Electioneering

Advertisements designed to influence a federal election

under the guise of issue advocacy usually end by telling the

viewer to call, ask, or tell a candidate to do something.

Findings § 2.4.3 (Pennington). From the perspective of

political consultants, who provide testimony in this case,

there is no practical difference between these “issue

advertisements” and those advertisements where express

advocacy is used. /d. (Strother) (“From the point of view of a

media consultant, there is no real difference between ending

an advertisement with ‘Vote for Senator X’ versus ending an

advertisement with ‘Tell Senator X to continue working hard

for America’s families.””’); (Beckett) (“However, in fact no

particular words of advocacy are needed in order for an ad to

influence the outcome of an election. No list of such words

could be complete . . . .”); (Lamson) (“When political parties

and interest groups run ‘issue ads’ just before an election that

Say ‘call’ a candidate and tell her to do something, their real

Purpose is typically not to enlighten the voters about some

issue, but to influence the result of the election, and these ads

often do have that effect.”). Plaintiffs have provided no

contrary political consultant testimony to discredit the

testimony of these political consultants. I find the

uncontroverted testimony of the political consultants

particularly compelling because it comes from well-known

and respected professionals who are engaged in the business

of making political advertisements. See id.

Ms. Tanya Metaksa, former Chair of the NRA PVF, stated

in her opening remarks at the American Association of Politi-

cal Consultants’ Fifth General Session on “Issue Advocacy”

that “[i}t is foolish to believe there is any practical difference

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between issue advocacy and advocacy of a political

candidate. What separates issue advocacy and _ political

advocacy is a line in the sand drawn on a windy day.” /d.

(Metaksa); see also id. (Strother) (“When we design, produce,

and run ‘issue ads’ that mention specific candidates for

federal office and that are aired in proximity to an election,

these ads are for only one purpose: to effect [sic] the outcome

of an election.”’). In concrete terms, perhaps the most striking

example of this “line in the sand drawn on a windy day,” is

the two camera shoot, where consultants bring two cameras to

shoot an advertisement. /d. (Strother). The film in Camera A

is used by the candidate, while the nearly identical film in

Camera B is sold for a nominal fee to a third party who then

“gets direct control over the images of the candidate used in

the issue groups ads.” /d. In my judgment, the testimony of

political consultants provides overwhelming evidence that

corporations and labor unions spend general treasury funds on

advertisements that, while not using words of express

advocacy, are designed to influence federal elections.

b. Current and Former Officeholders and Candidates

Testify that Corporations and Labor Unions Use General

Treasury Funds to Pay for Advertisements Designed to

Influence Federal Elections

In addition to political consultants, current and former

officeholders and candidates testify thatthe express advocacy

test has becorne meaningless, that no particular words of

advocacy are necessary to convey an electioneering message,

and that corporations and labor unions were using their

general treasury funds to influence federal elections. Id.

q 2.4.2. This testimony is particularly compelling given that

the political actors supporting BCRA, to borrow words from

Justice Byron White, “included many seasoned professionals

who have been deeply involved-in elective processes and who

have viewed them at close range over many years.” Buckley,

424 U.S. at 261 (White, J., concurring in part, dissenting in

814sa

part); see also Colorado I, 518 U.S. at 650 (Stevens, J.,

dissenting) (“Congress surely has both wisdom and

experience in these matters that is far superior to ours.”).

Even Plaintiff Congressman Ron Paul conceded during his

deposition that outside group issue advertisements run during

his 2000 congressional campaign were intended to influence

the election. Findings 4 2.4.2.1 (Paul). Politicians from both

political parties provide convincing testimony in this case,

and also provide important guidance through floor statements

made during the debate over campaign finance legislation,

that in their considered judgment the express advocacy test

was not preventing corporations and labor unions from

influencing federal elections using general treasury funds, and

that no particular words are necessary to convey an

electioneering message. /d. ¥ 2.4.2 (including statements and

testimony from Feingold, McCain, Levin, Bloom, Bumpers,

Chapin, and Shays).

c. Examples of Corporations and Labor Unions

Demonstrate That These Organizations Use Their General

Treasury Funds to Pay for Advertisements Designed to

Influence Federal Elections

The record, however, goes beyond the testimony of

experts, political consultants, and present and _ past

officeholders and candidates. The documented behavior of

corporations and labor unions also clearly demonstrates that

issue advocacy is used as a tool of electioneering by

corporations and labor unions. /d. J 2.6. The Findings, which

culled the most salient examples from the substantial record

submitted by the parties, demonstrate that, for example, the

AFL-CIO, the Coalition, Citizens for Better Medicare, the

NRA, and The Club for Growth all used corporate general

treasury funds to influence recent federal elections. /d.

{ 9 2.6.1-2.6.5. Plaintiffs dismiss this evidence as merely

“anecdotal,” McConnell Opp’n at 32, which is a

characterization of the weight of the evidence and not a

815sa

comment on whether it is rebutted. To the contrary, the

examples of corporations and labor unions using general

treasury funds to influence federal elections are not

“anecdotal,” but powerful illustrations of a regulatory regime

in paralysis. Indeed, like a mosaic, these “anecdotal

examples when combined with the other evidence in the

record relating to the general ineffectiveness of Section 44 1b,

and the failure of the express advocacy test, make a

compelling case for the restrictions Congress arrived at in

enacting Sections 201, 203, and 204 of BCRA.

1) The NRA

The Findings relating to the activities of Plaintiff NRA,

however, really drive home the point that the express

advocacy test has become meaningless and that corporations

spend general treasury funds on candidate-centered issue

advertisements to influence federal elections. /d. | 2.6.4.

Aside from the NRA’s media consultant who stated that the

first objective of the NRA was to influence the outcome of

the presidential election and other key congressional races, id.

at 2.6.4.1, the NRA ran two nearly identical radio

advertisements in the 2000 election: one paid for with PAC

money which used express advocacy and one paid for with

corporate general treasury funds which did not use express

advocacy. Id. | 2.6.4.4. The only real difference between the

advertisements was that the one paid for with PAC money

said “Vote George W. Bush for President” at the end of the

advertisement. /d. In my view, this advertisement is a perfect

example-the poster child-of how pointless the express

advocacy test is at distinguishing between genuine issue

advocacy and electioneering advertisements. In addition to

this evidence, the Findings, particularly those resting on the

internal documents of the NRA, id. 4 2.6.4.1, also

demonstrate just how driven the NRA was to use general

treasury funds, which fell outside the source and amount

81l6sa

limitations of FECA, to directly influence the 2000 federal

election. /d. 4 2.6.4.

2) Citizens for Better Medicare and The Club for Growth

Another glaring example from the Findings includes the

pharmaceutical industry’s uncontroverted efforts to. influence

the 2000 elections, id. | 2.6.3, by admittedly spending over

sixty-five million dollars on television advertising which,

according to Plaintiffs’ expert Dr. La Raja, was almost as

much as either of the two political parties spent on issue

advocacy, /d. | 2.6.3.4. The pharmaceutical industry’s efforts

were cloaked behind the name “Citizens for Better

Medicare.” I have concluded from the testimony and

documents submitted in this case that this issue advocacy

campaign mounted during the 2000 election cycle. was

designed to influence the federal election with corporate

general treasury funds in direct contravention of the historic

prohibition on such activity. See id. § 2.6.3; see also id.

{ 2.6.3.4 (“Much of CBM’s ad strategy leading up to the 2000

election was aimed at supporting candidates attacked in AFL-

CIO advertising.”’).

In addition to CBM’s activities, I have also found that

Plaintiff The Club for Growth influenced the 2000 federal

elections with corporate general treasury funds. /d. q 2.6.5.

The Club for Growth openly acknowledges in their

solicitation materials that “these issue advocacy campaigns

can make all the difference in tight races.” Jd. 9 2.6.5.4.

Moreover, the activity of The Club for Growth in Florida in a

2000 Congressional race demonstrates in an uncontroverted

manner the power of a corporation when it uses general

treasury funds to influence federal primary elections. /d.

q 2.6.5.5.

3) AFL-CIO

With regard to the AFL-CIO’s issue advocacy campaign

during the 1996 federal election, I have found that the AFL-

817sa

CIO used issue advocacy to influence the 1996 general

election. Findings § 2.6.1. The internal documents

surrounding the AFL-CIO’s efforts are particularly revealing

and directly contradict the AFL-CIO’s self-serving declara-

tion submitted in this case, which attempts te downplay the

electoral considerations behind their advertisements. Id.

2.6.1.1 (observing that the indirect effect on election out-

comes has “never been the point of [the AFL-CIO’s broadcast

advertising program”). The documents demonstrate that

media consultants were hired by the AFL-CIO to test how

their advertising would resonate with the electorate, how to

create advertisements that “manage the political message In a

volatile environment,” and even how to place a media buy in

Illinois to help a Senate candidate when the candidate did not

have the resources to fund advertising on his own. /d.

Moreover, other independent evidence, including expert

testimony, establishes that the AFL-CIO's 1996 issue

advocacy campaign was designed to influence the federal

election. /d. 94 2.6.1.2-2.6.1.5. The AFL-CIO does not refute

or explain the discrepancy between its general denial about its

issue advocacy and thesé contrary evidentiary documents.

The Findings elaborate on these points and others in more

detail, but I conclude from this evidence that during the 1996

election campaign the AFL-CIO used general treasury funds

to influence a federal election, and therefore was able to

circumvent FECA’s requirement that their efforts be paid for

with federal funds from a segregated account. See id.

4 2.6.1.6 (observing that twelve of the thirty-two House

Republican freshman targeted by the AFL-CIO were

defeated). |

4) The Coalition-Americans Working For Real Change

In response to the AFL-CIO, Plaintiffs Chamber of

Commerce, National Association of Manufacturers, and

National Association of Wholesaler-Distributors, and other

business entities, formed a corporation entitled the

818sa

“Coalition-Americans Working for Real Change” also to

influence directly the 1996 federal election. /d. q 2.6.2. I have

found that The Coalition’s issue advocacy campaign around

the 1996 election was designed to influence the federal

election. /d. Like the AFL-CIO, the internal documents of the

Coalition demonstrate that electoral strategies, and not “issue

advocacy,” were at the heart of the Coalition’s efforts in

1996. Id. 2.6.2.2. Indeed, the Coalition sought advice from

consultants and polling firms on how to maximize their

ability to influence federal elections. Jd. These internal

documents, combined with independent expert testimony and

the FEC General Counsel's report, see id. 4 § 2.6.2.3-2.6.2.4,

strongly contradict the Coalition’s self-serving efforts in this

litigation to portray their 1996 advertising campaign as

something less than electioneering advertisements in disguise.

The Coalition used corporate general treasury funds to

directly influence the 1996 election and, therefore, was able

to circumvent FECA’s policy of compelling corporations to

use federal money from a segregated account. See generally

id. | 2.6.2; see also id. | 2.6.2.2 (post-election analysis done

by Coalition’s polling firm).

The AFL-CIO and The Coalition presented no

uncontroverted evidence that they did not try to influence the

1996 federal election with issue advertisements. Moreover,

these organizations do not contest that they paid for these

advertisements with general treasury funds. The effort by the

AFL-CIO and The Coalition to portray themselves as

engaging in issue advocacy, as opposed to electioneering, is

belied by their own internal documents.

d. Other Examples of Advertisements Demonstrate That

Corporations and Labor Unions Use Their General Treasury

Funds to Pay for Advertisements Designed to Influence

Federal Elections ,

Aside from the examples above of corporations and labor

unions directly using general treasury funds to influence

819sa

federal elections, the attributes of so-called “issue

advertisements” in the Findings demonstrate the

electioneering purpose behind these commercials.

1) Organizations Run Issue Advertisements About Which

They Have No Particular Organizational Interest

First, the Findings compellingly demonstrate that many

candidate-centered issue advertisements are run about issues

in which the organization sponsoring the advertisement has

no interest. Jd. § 2.6.6. On this basis, it is clear that these

advertisements were designed to influence a federal election.

For example, EMILY’s List, an organization dedicated to

pro-choice female candidates, ran advertisements on gun-

control for federal candidate Linda Chapin. /d. § 2.6.6.1.

Other examples from the Findings include the Associated

Builders and Contractors running an advertisement about a

federal candidate that dealt with penalties for child molesters.

Id. 4 2.6.6.2 (admitting that such an advertisement is not of a

particular concern of contractors). In another situation, the

Club for Growth funneled $20,000 to the American

Conservative Union to fund an issue advertisement relating to

Hillary Clinton’s candidacy which the Club candidly

admitted at deposition had nothing to do with the Club’s

interest in pro-growth conservative Republicans. /d. | 2.6.6.3.

Another example is an advertisement run by the trucking

industry, urder the pseudonym “The Foundation for

Responsible Government,” praising the record of an opponent

of a Senator on health care and taxes. /d. { 2.6.6.4 (observing

that the Senator was a target of the group because he

supported legislation banning triple trailer trucks). Finally,

the group Citizens for Life, a New Hampshire Pro-Life

Organization, ran advertisements in 2000 against John

McCain criticizing jokes allegedly made by McCain about

Alzheimer’s and a home for senior citizens. /d. | 2.6.6.5. The

New Hampshire group claimed the advertisement was timely

because the New Hampshire State Senate was close to voting

820sa

on a bill to legalize assisted suicide. Jd. I am not persuaded

that any of these advertisements were anything other than

electioneering advertisements. Rather, these examples

demonstrate that corporations spend general treasury funds on

candidate-centered issue advertisements to influence federal

elections. /d. | 2.6.6.6.

2) Organizations Run Issue Advertisements About Past

Votes or About Issues No Longer Before Congress

Second, Organizations run candidate-centered issue

advertisements praising or criticizing candidates for past

votes or discussing a Member’s position of an issue not

pending before Congress. These candidate-centered issue

advertisements are clearly designed to influence federal

elections. Id. | 2.6.7. For example, the AFL-CIO has run a

series of advertisements on past votes of particular Members

of Congress. Id. ¥ 2.6.7.1. As discussed in my Findings, these

advertisements are nothing more than campaign

advertisements. /d. Another example of this practice is the

Chamber’s advertisements attacking various Members of

Congress over the prescription drug issue that was not

pending before Congress when the advertisements were aired.

Id. ¥ 2.6.7.2. Many of these advertisements did not include a

phone number to contact the Member, and some of the

advertisements were aired against candidates who were not

even Members of Congress. Jd. The Chamber’s advertising in

this regard was plainly designed to influence the federal

election. Jd. These examples from the AFL-CIO and the

Chamber also demonstrate that corporations and labor unions

used general treasury funds to pay for candidate-centered

issue advertisements designed to influence a federal electi

Id. 4 2.6.7.3. eral election.

3) Organizations Air Advertisements When A Candidate

Lacks Funds to Run Advertisements and So a Candidate Can

Avoid Running Advertisements Attacking an Opponent

821sa

Corporations and labor unions also use general treasury

funds to pay for candidate-centered issue advertisements (a)

when candidates lack funds to put their own advertisements

on the air and (b) to attack a candidate’s opponent so that the

candidate can run only “positive” advertisements. /d. ¥ 2.6.8.

These indicators provide yet another powerful indication that

these “issue advertisements” are nothing short of campaign

advertisements designed to affect elections, paid for with the

general treasury funds of corporations and labor unions. /d.

q 2.6.8.4. The uncontroverted testimony of political consult-

ants is that negative character advertisements are often run by

a third party because they shield the candidate from the

political repercussions that are likely to result if the candidate

actually ran the negative advertisement him or herself. /d. {

2.6.8.1. In addition to allowing the candidate to refrain from

running negative advertisements, organizations often run such

advertisements praising a candidate or criticizing the

candidate’s opponent when the candidate’s campaign does

not have resources to run advertising on its own. /d. { 2.6.8.2

(former Representative discussing how his opponent did not

buy media in a media market that covered 40% of his district,

but that other groups filled the void attacking the

Representative); id. § 2.6.8.3 (beneficial advertisements by

EMILY’s List ran when the Chapin campaign was not on the

air to save resources); id. ¥ 2.6.1.1 (internal memorandum of

the AFL-CIO discussing advertising buy by the union to help

Illinois Senate candidate in markets where the candidate

lacked resources to air advertising). I conclude that these

advertisements were also clearly designed to influence a

federal election and paid for with the general treasury funds

of corporations and labor unions.

7. Conclusion

In sum, it again bears emphasizing that FECA has always

permitted corporations and labor unions to run electioneering

advertisements, provided that those advertisements were paid

822sa

for with money that came from a segregated fund dedicated

specifically for federal electioneering. As the examples above

illustrate, the utility of Section 441b as a tool to prevent

corporate and labor union general treasury funds from

influencing elections has been effectively blunted. See id.

q 2.6.9. While the primary purpose of these advertisements

ultimately may be difficult to determine with precision, given

the reticence of these organizations to admit they are

campaign advertisements, the effect of these advertisements

on federal elections is legion. Consequently, as I state in my

Findings, “Congress found that FECA, as construed by the

Courts, to only limit independent expenditures containing

express advocacy, was no longer relevant to modern political

advertisements.” Jd. 9 2.4.4; see also id. q 2.4.3 (unrebutted

testimony of political consultant Bailey) (“The notion that ads

intended to influence an election can easily be separated from

those that are not based upon the mere presence or absence of

particular words or phrases such as ‘vote for’ is at best a

historical anachronism.”). Congress appropriately concluded

that corporations and labor unions were openly violating the

intent of its longstanding (and long-upheld) prohibition on the

use of corporate and labor union general treasury funds to

influence elections.

In crafting the primary definition of electioneering

communication, Congress recognized just how difficult the

task of discerning a speaker’s true intent can be for a court or

regulatory agency. Taking heed from Buckley’s stringent

admonition that a distinction between the discussion of issues

and advocacy for the election or defeat of candidates “may

often dissolve in practical application” and that a law must be

construed in a manner that avoids “‘put [ting] the speaker in

these circumstances wholly at the mercy of the varied

understanding of his hearers,”* Buckley, 424 U.S. at 42, 43,

Congress crafted an objective, impartial, and thoroughly

simple test for distinguishing between electioneering and

issue advocacy. Congress recognized, as the record in this

823sa

case indicates, that candidate-centered issue advertisements

influence federal elections. Congress thereafter drew an

incredibly clear bright-line test that focuses on the key

empirical determinants that distinguish pure issue

advertisements from candidate-centered issue advertisements.

The result is that broadcast advertisements paid for by

corporations or labor unions, aired in close proximity to an

election that clearly identify a federal candidate, and are

targeted to that candidate’s electorate, need to be paid for

with federal funds from a segregated account. Congress,

therefore, is not prohibiting speech by any corporation or

labor union; it is merely requiring these organizations to pay

for speech that ostensibly influences federal elections with

segregated funds that are regulated under FECA.

The question remaining is whether this bright line that

Congress has drawn is narrowly tailored to serve compelling

governmental interests. I shall first turn to the compelling

governmentai interests behind Title II and then shall move to

a discussion of whether Title II of BCRA is narrowly tailored

to serve those compelling governmental interests.

E. Title Il of BCRA is Narrowly Tailored to Serve a

Compelling Governmental Interest

1. _ BCRA’s Prohibition on Electioneering Communi-

cations; the Primary Definition Serves Compelling

Governmental Interests

As discussed supra, Section 203 extends the longstanding

prohibition on corporations and labor unions making

contributions or expenditures from sont treasuries in

nection with federal elections to electioneering commu-

canis as defined in the primary definition. BCRA § 203;

FECA § 316(b)(2); 2 U.S.C. § 441b(b)(2). Ce porations and

labor unions are now prohibited from spending general

treasury funds on electioneering communications, but are

permitted to spend unlimited federal money from separate

824sa

Segregated funds on electioneering communications. Even

though a corporation or labor union “remains free to establish

a separate segregated fund, composed of contributions

earmarked for that purpose by the donors . . . the corporation

[or labor union] is not free to use its general funds for

campaign advocacy purposes [and while that is not an

absolute restriction on speech, it is a substantial one.” MCFL,

479 U.S. at 253 (emphasis in original) (plurality opinion). As

a result, even though the Act permits corporations and labor

unions to make electioneering communications with their

segregated funds, the prohibition in section 203 must be

“justified by a compelling state interest.” /d.

In discussing the compelling governmental interests in

enacting sections 203 and 204, Defendants rely on long-

standing precedent of the Supreme Court that has already

extensively discussed the compelling interests related to

government regulation of corporate and labor union general

treasury funds in the context of federal elections. Gov’t Br. at

133-134. The Supreme Court’s prior discussions of the

compelling interests needed to sustain restrictions on

corporate and labor union general treasury funds are equally

applicable in the context of Sections 203 and 204 of BCRA.

Plaintiffs, with the exception of the NRA, do not seriously

question this position, but rather focus their energies on

the fact that these provisions are not narrowly tailored to

serve these compelling governmental interests. As discussed

infra, 1 find Plaintiffs’ argumentation on that point to be

rebutted by the extraordinary record in this case. Before

turning to these arguments, however, I shall briefly discuss

the compelling governmental interests behind sect »ns 203

and 204 in Title IL.

In defending the constitutionality of Title II, Defendants

rely on the compelling governmental interest described in

Austin v. Michigan Chamber of Commerce, 494 U.S. 652

(1990), and supported by a rich history of Supreme Court

825sa

cases discussing Section 441b.'” Defendants also contend

that the compelling governmental interest supporting the

prohibition on electioneering communications relates to the

potential for the appearance of corruption that occurs when

corporations and labor unions pay for electioneering

communications with their general treasury funds. Tr. at 252

(Waxman) (“[{T]he record in this case of the kind of Austin

corruption, and even potential quid pro quo cor uption,

absolutely dwarfs the evidentiary record that the Supreme

Court has considered. in any of the cases it has decided,

including Buckley.’’). As a corollary to this latter theory,

Defendants also advance an anti-circumvention rationale to

justify these provisions, observing that “BCRA’s regulation

of electioneering communications furthers the compelling

governmental interest in preventing corruption of elected

officials, not only on its own terms, but also by helping to

ensure that the new limits on soft money will not be easily

evaded.” Gov’t Br. at 146. I conclude that the first two

theories of corruption are sufficient to uphold the challenged

provisions and therefore do not reach the third.

a. Corruption Related to Corporations and Labor

Unions

The Supreme Court has long indicated that the government

has a compelling interest in placing restrictions on corporate

and labor union involvement in federal elections SO as to

prevent “the corrosive and distorting effects of immense

aggregations of wealth,” facilitated by either the corporate or

union forms, on federal elections. Austin, 494 U.S. at 660. As

discussed supra, corporations and labor unions routinely seek

” ies to the litigation have dubbed this compelling

PO Bt theory “Austin corruption.” Even though the statute

in Austin only applied to corporations, Austin, 494 U.S. at 655, the

Supreme Court has long upheld a similar corruption rationale in the case

of labor unions. See Pipefitters, 407 U.S. at 415-16, UAW, 352 U.S. at

585, NRWC, 459 U.S. at 207-08.

826sa

to influence federal elections with broadcast advertising

campaigns, paid for with general treasury funds. Sections 203

and 204 of BCRA, which are plainly designed to combat this

development, fulfill the same purposes that the government

identified as supporting Section 441b in NRWC and that the

Supreme Court upheld:

The first purpose of § 441b, the government states, is to

ensure that substantial aggregations of wealth amassed

by the special advantages which go with the corporate

form of organization should not be converted into

political “war chests” which could be used to incur

political debts from legislators who are aided by the

contributions. See United States v. United Automobile

Workers, 352 U.S. 567, 579 (1957). The, second purpose

of the provisions, the government argues, is to protect

the individuals who have paid money into a corporation

or union for purposes other than. the support of

candidates from having that money used to support

political candidates to whom they may be opposed. See

United States v. CIO, 335 U.S. 106, 113 (1948).

We agree with the government that these purposes are

sufficient to justify the regulation at issue.

NRWC, 459 U.S. at 207-08. In a nutshell, NRWC

encapsulates the compelling governmental interests behind

Section 441b, which also plainly serve as a basis for

upholding BRCA Sections 203 and 204.

The Supreme Court’s most recent discussion of these

justifications was in Austin, where the Supreme Court

considered a Michigan state statute which was patterned after

section 441b, prohibiting corporations from making

independent expenditures in connection with state candidate

elections. Austin, 494 U.S. at 655 n.1. The issue before the

Court was the constitutionality of the state’s ban on

independent expenditures made by corporations, which the

Court held to be “constitutional because the provision is

827sa

narrowly tailored to serve a compelling state interest.” Id. at

655. In finding the compelling interest justifying Michigan's

statute, the Court recognized a “different type of corruption in

the political arena” than the appearance of corruption that had

been used to justify Buckley's restrictions on individuals

making independent expenditures. /d. at 660.

As a baseline, the Austin Court reiterated that “‘[p]revent-

ing corruption or the appearance of corruption are the only

legitimate and compelling government interests thus far

identified for restricting campaign finances.”* /d. at 658

(quoting FEC v. Nat’l Conservative Political Action Comm.,

470 U.S. 480, 496-97 (1985) (“NCPAC’’)) (alteration in

original). The plaintiff in Austin had argued that because the

restriction at issue focused on independent expenditures, as

opposed to contributions, the danger of corruption or the

appearance of corruption was not present. See Buckley, 424

U.S. at 47 (“Unlike contributions, such independent expendi-

tures may well provide little assistance to the candidate's

campaign and indeed may prove counter-productive. The

absence of prearrangement and coordination of an expendi-

ture with the candidate or his agent not only undermines the

value of the expenditure to the candidate, but also alleviates

the danger that expenditures will be given as a quid pro quo

for improper commitments from the candidate.”).

The Austin Court responded by distinguishing this

language on the basis that it applied to independent

expenditures made by individuals as opposed to those made

by corporations. Austin, 494 U.S. at 659. Indeed, Austin

pointed out that the Court had left open the possibility in

Bellotti, that “a legislature might demonstrate a danger of real

or apparent corruption posed by such expenditures when

made by corporations to influence candidate elections.” /d.

(emphasis added) (citing Bellotti, 435 U.S. at 788 n.26) (“The

importance of the governmental interest in preventing

(corruption of elected representatives through the creation of

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political debts] has never been doubted. The case before us

presents no comparable problem, and our consideration of a

corporation’s right to speak on issues of general public

interest implies no comparable right in the quite different

context of participation in a political campaign for election to

public office. Congress might well be able to demonstrate the

existence of a danger of real or apparent corruption in

independent expenditures by corporations to influence

candidate elections.’’) (emphasis added).

Having set forth this analysis, the Supreme Court found

that regardless of whether the danger of “financial quid pro

quo corruption,” id. at 659 (internal citations and quotation

marks omitted), identified in Buckley as insufficient to uphold

the limitation on independent expenditures made by

individual donors, was present in the case of a corporation (a

question clearly left open in Bellotti), the Court found that a

“different type” of corruption rationale was sufficient to serve

as Michigan’s compelling interest. Jd. at 659, 659-60. The

Austin Court stated this rationale as “the corrosive and

distorting effects of immense aggregations of wealth that are

accumulated with the help of the corporate form and that have

little or no correlation to the public’s support for the

corporation’s political ideas.” /d. at 660. The Supreme Court

was keen to point out that “the mere fact that corporations

may accumulate large amounts of wealth is not the

justification for [Michigan’s restriction on independent

expenditures]; rather, the unique state-conferred corporate

structure that facilitates the amassing of large treasuries

warrants the limit on independent expenditures.” /d.

This “different” theory of corruption was not new as the

Austin Court observed. /d. at 659 (“We therefore have

recognized that ‘the compelling governmental interest in

preventing corruption support[s] the restriction of the

influence of political war chests funneled through the

corporate form.”’) (quoting FEC y. Nat'l. Conservative

829sa

Political Action Committee, 470 U.S. 480, 500-01 (1985)

(“NCPAC’’)) (also citing MCFL, 479 U.S. at 257). In fact, in

MCEL the Court pointed out:

We have described that rationale in recent opinions as

the need to restrict “the influence of political war chests

funneled through the corporate form,” NCPAC, 470 U.S.

at 501; to “eliminate the effect of aggregated wealth on

federal elections,” Pipefitters, 407 U.S. at 416; to curb

the political influence of “those who exercise control

over large aggregations of capital,” [UAW], 352 US. at

585; and to regulate the “substantial aggregations of

wealth amassed by the special advantages which go with

the corporate form of organization,” National Right to

Work Committee, 459 U.S. at 207. This concern over the

corrosive influence of concentrated corporate wealth

reflects the conviction that it is important to protect the

integrity of the marketplace of political ideas.

MCEL, 479 U.S. at 257.

Outside the context of corporations, the Supreme Court has

been generally solicitous of a similar rationale for upholding

Section 441b as applied to labor unions. In Pipefitters and

UAW, as the MCFL Court observed, the Supreme Court

found that the compelling governmental interest behind the

regulation of corporations was applicable to labor unions.

Pipefitters, 407 U.S. at 415-16 (“When Congress prohibited

labor organizations from making contributions or expendi-

tures in connection with federal elections, it was, of course,

concerned not only to protect minority interests within the

union but to eliminate the effect of aggregated wealth on

federal elections.”); UAW, 352 U.S. at 585 (“To deny that

[using union dues to sponsor commercial television

broadcasts designed to influence the electorate to select

certain candidates for Congress in connection with the 1954

elections] constituted an ‘expenditure in connection with any

[federal] election’ is to deny the long series of congressional

efforts calculated to avoid the deleterious influences on

830sa

federal elections resulting from the use of money by those

who exercise control over large aggregations of capital.”). As

noted in NRWC, the government’s interest in enacting such a

provision relates to the fact that labor union members pay

money into a union’s general treasury and that money may be

used to support candidates for office opposed by the

individual union member, NRWC, 459 U.S. at 208, a

justification that applies with equal force to corporate

shareholders. /d. at 207.

Except for the NRA, none of the Plaintiffs who challenge

Title Il explicitly contest the asserted compelling governmen-

tal interests relating to preventing corruption or the

appearance of corruption that emanates from the particular

legal and economic attributes of corporations and labor

unions. Given the longstanding history behind section 441b,

this is not unexpected. Despite this fact, the NRA Plaintiffs

spend significant time in their pleadings asserting that the

compelling interest cannot support sections 203 and 204.

NRA Br. at 9-14; NRA Opp’n at 6-17, NRA Reply at 12-14.

As clarified by their reply brief, the NRA basically argues

that this type of corruption only applies to those corporations

that “use resources amassed in the economic marketplace, to

obtain an unfair advantage in the political marketplace.” NRA

Reply at 12 (quoting Austin, 494 U.S. at 659 (in turn quoting

MCFL, 479 U.S. at 257)). In Austin, the Michigan Chamber

of Commerce, relying on MCFL, contended that the Michigan

statute could not be applied to it because it was a “nonprofit

ideological corporation.” Austin, 494 U.S. at 661. The

Supreme Court flatly rejected this as-applied challenge. Id. at

662-65. In this case, the NRA asserts a similar argument: that

it is unlike the Michigan Chamber of Commerce in Austin,

and therefore, broadly speaking, Title II cannot be justified as

preventing Austin corruption. NRA Reply at 12 (stating that

the NRA does not do business in the economic marketplace,

nor derive market profits, nor derive more than a negligible

portion of its revenues from corporate contributions).

83lsa

Basically, however, the NRA is using Austin as a means of

making an as-applied challenge to BCRA.

To begin with, in MCFL, the Supreme Court stressed that

the rationale for regulating corporations and labor unions was

“longstanding” and used to restrict “the corrosive influence of

concentrated corporate wealth” on federal elections. MCFL,

479 U.S. at 257. The Supreme Court went on to explain that

“(bly requiring that corporate independent expenditures be

financed through a political committee expressly established

to engage in campaign spending, § 441b seeks to prevent this

threat to the political marketplace.” /d. at 258. The resources

available to the segregated fund, the Court reasoned, reflected

“popular support for the political positions of the committee.”

Id. As a result, the Court observed that “[rjegulation of

corporate political activity thus has reflected concern not

about use of the corporate form per se, but about the potential

for unfair deployment of wealth for political purposes.” /d.

Nevertheless, the Supreme Court concluded that the

government could not uphold Section 441b as applied to the

plaintiff in MCFL based on this admittedly “longstanding’

rationale. /d. (“Groups such as MCFL, however, do not pose

that danger of corruption. MCFL was formed to disseminate

political ideas, not to amass capital. The resources it has

available are not a function of its success in the economic

marketplace, but its popularity in the political marketplace.

While MCFL may derive some advantages from its corporate

form, those are advantages that redound to its benefit as a

political organization, not as a profit-making enterprise.”).

Therefore, the Supreme Court never questioned the

government’s asserted compelling interest in regulating

corporations of all types—it merely held that as applied to

MCEL, the rationale was insufficient to support Section

441b’s restrictions.

The NRA would have us believe that this form of

corruption is only available to uphold Section 441b

832sa

restrictions when the corporations being regulated are of the

for-profit variety. NRA Reply at 12. In Austin, and for that

matter in MCFL, the Supreme Court made no distinctions

among different types of corporations when analyzing the

compelling governmental interest. The Austin Court thus

broadly recognized that all corporations benefit from the

“state- conferred corporate structure that facilitates the

amassing of large treasuries.” Austin, 494 U.S. at 660; see

also MCFL, 479 U.S. at 268 (Rehnquist, C.J., concurring in

part, dissenting in part) (“I do not dispute that the threat from

corporate political activity will vary depending on the

particular characteristics of a given corporation; it is obvious

that large and successful corporations with resources to fund

a political war chest constitute a more potent threat to the

political process than less successful business corporations or

nonprofit corporations . . . . These distinctions among corpo-

rations, however are distinctions in degree that do not amount

to differences in kind.”) (emphasis added) (internal citation

and quotation marks omitted). The Court in MCFL merely

held that as applied to the plaintiff in MCFL, Section 441b

could not be upheld by the longstanding compelling

governmental interest present in avoiding the corrosive

effects of large treasuries of corporations accumulated with

the assistance of the corporate form. In Austin, the Court held

that the state statute could be applied to the plaintiff because

the Michigan Chamber of Commerce did not qualify for an

MCFL exemption.

The NRA never directly disputes this proposition; rather,

the organization essenjially contends that like the plaintiff in

MCFL, and unlike the plaintiff in Austin, sections 203 and

204 of BCRA cannot be upheld when applied to the NRA

because as an organization it does not use resources amassed

in the economic marketplace to obtain an unfair advantage in

the political marketplace. NRA Br. at 12; see also NRA

Reply Br. at 12. The NRA implicitly presents the Court with

an as-applied challenge couched in Austin-terms instead of

833sa

those of MCFL. NRA Br. at 14 (“In any event, the NRA

satisfies every criterion identified by the Austin Court for

extending the First Amendment’s protection to the

independent political expenditures of a nonprofit political

advocacy corporation . . . .”’). Of course, in making its

decision that the Michigan Chamber of Commerce did not

qualify for an MCFL as-applied exemption, the Austin Court

was explicitly relying on MCFL. Austin, 494 U.S. at 661-62.

On July 31, 2002, the NRA filed a ioint motion to stay,

inter alia, discovery in this case and agreed that they would

also stay any as-applied challenge they had against BCRA

under MCFL until the Supreme Court resolved the merits of

Plaintiffs’ challenge to BCRA. NRA Joint Mot. to Stay (Jul.

31, 2002) at 1-2. On August 13, 2002, the three-judge District

Court entered an order granting this motion. NRA v. FEC,

02cv581 (D.D.C. Aug. 13, 2002) (order on joint motion to

stay) (“ORDERED that there will be a stay of discovery and

briefing of Plaintiffs’ contention that BCRA’s restrictions on

‘electioneering communications’ are unconstitutional as

applied to them.”). As is clear from their briefing on this

point, with the MCFL avenue closed to them, Plaintiff NRA

uses Austin to argue that BCRA, as applied to them, fails to

satisfy any compelling governmental interest. NRA Reply at

12 (observing that Title II cannot be justified as designed to

present Austin-type corruption because it does not amass

resources in the economic marketplace.).

The NRA should not be able to litigate an as-applied

challenge to Title II in direct violation of the three-judge

panel’s order, requested by the NRA, by merely cloaking

such a challenge under Austin as opposed to MCFL.

Defendants point out that they did not conduct discovery into

the NRA’s business practices on the basis of this order and

therefore are in no position to discuss whether the NRA

deserves an MCFL-type exemption. Gov’t Opp’n at 107

n.109 (“Defendants have, thus, had no opportunity to

834sa

discover facts that might refute, inter alia, NRA’s contention

about its profits derived from business activities.”); Def.-Int.

Opp’n at 67 n.208 (“Indeed, the NRA specifically stipulated

with defendants in this case that its as-applied challenge to

coverage based on MCFL would be stayed pending the

outcome of the general facial challenge. See Joint Motion to

Stay (filed on July 26, 2002), at 2 (granted by the Court on

Aug. 13, 2002).”).

Any | corporation that believes it deserves an MCFL-

exemption may seek an exemption under the FEC’s

regulations-and any arguments relating to the strictness of

those regulations-are open to a challenge at that time, by

making that claim, or by resisting enforcement, just as the

plaintiffs did in Austin and MCFL. Accordingly, the NRA’s

claim has no merit in this litigation, NRA v. FEC, 02cv581

(D.D.C. Aug. 13, 2002) (order on joint motion to stay),'° and

123

In addition to the NRA, the ACLU also hints in its briefing that it

fits within the class of corporations deserving of MCF L-type protection.

See ACLU Br. at 16. I am extraordinarily skeptical that the NRA or the

ACLU fit within the MCFL paradigm, which Justice Brennan, the author

of MCFL described as a “small” class of exempt organizations. Austin

494 U.S. at 672 (Brennan, J., concurring). First, each organization accepts

corporate “oy ACLU Br. at 2 n.2, NRA Br. at 2. In MCFL, the

corporation an explicit policy against acceptin orpora'

contributions. MCFL, 479 U.S. at 264. The NRA sates 4 pe

contributions are “negligible,” NRA Br. at 2, while the ACLU argues that

their corporate donations are “extremely modest,” ACLU Br. at 17. These

statements, themselves, indicate that both organizations would be

minimally burdened if they were to forgo corporate funding so as to

qualify for MCFL status. Nevertheless, the absolute amounts involved-

$85,000 for the ACLU, ACLU Br. at 2 n.2, and $385,000 for the NRA,

NRA Br. at 2-are not petty cash, particularl ompared wi

RA . yc with what

Circuit has found to be de minimis. arin

The D.C. Circuit has held, in a case involving the NRA itself, that an

organization may qualify for an MCFL exemption as long as it is not “a

- potential conduit for corporate funding of political activity.” FEC v. NRA,

254 F.3d 173, 192 (D.C.Cir.2001). In NRA, the court stated that ‘the

835sa

I conclude that the longstanding compelling governmental

interests behind Section 441b are equally applicable to -

Sections 203 and 204 of BCRA.

b. Appearance of Corruption

Moreover, I find that congressional action in this case

could be justified under the rationale that electioneering

communications made with general treasury funds of

corporations and labor unions create an appearance of

corruption. The record powerfully demonstrates that

electioneering communications paid for with the general

treasury funds of labor unions and corporations endears those

entities to elected officials in a way that could be perceived

by the public as corrupting.

In my judgment, the record in this case with regard to

interest group issue advocacy substantially demonstrates the

appropriate test for this inquiry is whether “[t}he harm contemplated by

the statute stems from the absolute amount of corporate money an

organization has to spend in the political process, not from the

relationship between corporate contributions and the organization $ total

revenues.” /d. (finding that $7,000 in corporate contributions in one year

precluded the NRA from taking advantage of the MC FL-exemption).

Moreover, the NRA openly admits that it engages in business

activities. Compare NRA Br. at 19 (discussing that it loses money on

advertising in its magazines and sale of NRA memorabilia but that it

generates $1.7 million in rental income on leasing its building space) with

MCFL, 479 U.S. at 264 (observing that an MCFL-type corporations

“cannot engage in business activities.”). Furthermore, ia MCFL, the

plaintiff “was formed for the express purpose of promoting political ideas,

and cannot engage in business activities.” MCFL, 479 U.S. at 264. In

addition to its primary purpose of Second Amendment advocacy, the

NRA also “promotes public firearm safety, trains law enforcement

agencies in the use of firearms, sponsors shooting competitions, and

advances hunter safety.” Findings ¢ 13.

Obviously, until a fuller factual record concerning these two

organizations has been developed, an as-applied challenge to Title II of

BCRA is inappropriate.

836sa

potential for the appearance of corruption given the current

practices of labor unions and corporations in connection with

federal elections. As noted supra, the Supreme Court in

Bellotti left open the possibility that in the context of

candidate elections the record in a future case might be

sufficient to justify restrictions on independent expenditures

paid for with the general treasury funds of corporations and

labor unions. Bellotti, 435 U.S. at 788 n.26 (“The overriding

concern behind the enactment of statutes such as the Federal

Corrupt Practices Act was the problem of corruption of

elected representatives through the creation of political debts.

The importance of the governmental interest in preventing

this occurrence has never been doubted. The case before us

presents no comparable problem . . . .’’); see also NCPAC,

470 U.S. at 510 n.7 (White, J., dissenting) (“The possibility

was thus left open, and remains open, that unforeseen

developments in the financing of campaigns might make the

need for restrictions on ‘independent’ expenditures more

compelling . . . . The time may come when the governmental

interests in restricting such expenditures will be sufficiently

compelling to satisfy not only Congress but a majority of this

Court as well.”). In my view, this case presents just such a

record. See Findings § 2.7.

The factual findings of the Court illustrate that corporations

and labor unions routinely notify Members of Congress as

soon as they air electioneering communications relevant to

the Members’ elections. Findings 4 4 2.7.3, 2.7.6. The record

also- indicates that Members express appreciation to

organizations for the airing of these election-related

advertisements. Jd. § § 2.7.2, 2.7.8. Indeed, Members of

Congress are particularly grateful when negative issue

advertisements are run by these organizations, leaving the

candidates free to run positive advertisements and be seen as

“above the fray.” /d. § 2.7.2. Political consultants testify that

campaigns are quite aware of who is running advertisements

on the candidate’s behalf, when they are being run, and where

837sa

they are being run. /d. § 2.7.1.'% Likewise, a prominent

lobbyist testifies that these organizations use issue advocacy

as a means to influence various Members of Congress. /d.

The Findings also demonstrate that Members of Congress

seek to have corporations and unions run these advertise-

ments on their behalf. Jd. § 2.7.8. The Findings show that

Members suggest that corporations or individuals make

donations to interest groups with the understanding that the

money contributed to these groups will assist the Member in a

campaign. Id. 2.7.10.6; see also id. § 2.7.4. After the

election, these organizations often seek credit for their

support. /d. | 2.7.5; see also id. ¥ 2.7.4. In a similar manner,

political parties are often grateful for the support of these

organizations, id. § 2.7.10, and parties have sent contributions

to these organizations, id. § 2.7.10.4. Finally, a large majority

of Americans (80%) are of the view that corporations and

other organizations that engage in electioneering communica-

tions, which benefit specific elected officials, receive special

consideration from those officials when matters” arise that

affect these corporations and organizations. /d. { 2.7.9.

The evidence, therefore, paints a picture of corporations

and labor unions targeting particular federal candidates or

their opponents-that the organizations have a specific interest

in getting these particular candidates elected to federal office.

The candidates and political parties are well aware of these

corporations and labor unions and are cognizant of which

organization is running advertisements supporting their

candidacy. It is also quite clear that these candidates are very

appreciative of the additional electioneering support provided

on their behalf from the general treasuries of corporations and

'24 On the other hand, it is sometimes the case that when a candidate is

attacked, the candidate and his/her consultants are unaware of who is

running the negative advertisement because the organization running the

advertisement is cloaked behind a misleading name. See generally Per

Curiam Opinion Findings Related to BCRA’s Disclosure Provisions.

838sa

labor unions. All of this creates the appearance of corruption,

as is demonstrated by the polling data in the Findings.

The NRA also challenges this asserted interest, arguing

that “gratitude” is not corruption. NRA Opp’n at 8-12. The

NRA misses the point of Defendants’ argument, which is that

the electioneering broadcasts disguised as “issue advocacy,”

create a very significant appearance of corruption.

Defendants never argue that “gratitude” is corruption as the

NRA would have the Court believe. Rather, Defendant-

Intervenors correctly observe that “[t]he result is plain:

candidates can be as beholden to corporations or unions that

spend morey to help them through ad campaigns as they

would be if the same entities wrote a check directly to the

campaign, or funneled the money through the political party.”

Def.-Int. Br. at 108-09. In my view, the potential for the

appearance of corruption-identified as the compelling

justification for sections 203 and 204 of BCRA-relates to the

very simple fact that when a corporation or labor union.

spends millions of dollars from its general treasury on a

campaign, elected officials are likely to feel beholden when

matters relating to these organizations arise.

_ In Buckley, the Supreme Court stated with regard to the

independent expenditure restrictions on individuals that

quite apart from the shortcomings of § 608(e)(1) in

preventing any abuses generated by large independent

expenditures, the independent advocacy restricted by the

provision does not presently appear to pose dangers of

real or apparent corruption comparable to those

identified with large campaign contributions. The parties

defending § 608(e)(1) contend that it is necessary to

prevent would-be contributors from avoiding the

contribution limitations by the simple expedient of

paying directly for media advertisements or for other

portions of the candidate’s campaign activities. They

argue that expenditures controlled by or coordinated

with the candidate and his campaign might well have

839sa

virtually the same value to the candidate as a

contribution and would pose similar dangers of abuse.

Yet such controlled or coordinated expenditures are

treated as contributions rather than expenditures under

the Act. Section 608(b)’s contribution ceilings rather

than § 608(e)(1)’s independent expenditure limitation

prevent attempts to circumvent the Act through

prearranged or coordinated expenditures amounting to

disguised contributions.

Buckley, 424 U.S. at 46-47 (emphasis added). The Court in

Buckley wrote that the threat of independent expenditures

made by individuals did not “presently appear” to pose a

danger of possible corruption. Therefore, Buckley explicitly

left open the possibility that a time might come when a record

would indicate that independent expenditures made by

individuals to support candidates would raise an appearance

of corruption. The Court concluded, in 1976:

[Slection 608(e)(1) limits expenditures for express

advocacy of candidates made totally independently of

the candidate and his campaign. Unlike contributions,

such independent expenditures may well provide little

assistance to the candidate’s campaign and indeed may

prove counterproductive. The 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 expenditures will be given as a quid pro quo

for improper commitments from the candidate. Rather

than preventing circumvention of the contribution

limitations, § 608(e)(1) severely restricts all independent

advocacy despite its substantially diminished potential

for abuse.

Buckley, 424 U.S. at 47. This discussion in Buckley spoke

only of the lack of evidence in that record with regard to

restrictions on the independent expenditures of individuals;

an issue that has clearly not been foreclosed for corporations

840sa

or /abor unions. Bellotti, 435 U.S. at 788 n.26 (“Congress

might well be able to demonstrate the existence of a danger of

real or apparent corruption in independent expenditures

by corporations to influence candidate elections.”). In my

view the record assembled by the parties in this case

demonstrates that a compelling governmental interest behind

Congress’s regulatory effort was to prevent the appearance of

corruption. It is a legitimate interest and the NRA’s

arguments are unpersuasive.'*

c. Conclusion

The compelling governmental interests identified by the

Supreme Court in its campaign finance jurisprudence apply

equally to Sections 203 and 204 of BCRA. Plaintiffs, aside

from the NRA, do not challenge these bases as a justification

for the restrictions on electioneering communications

contained in Title II. Rather, Plaintiffs vigorously contend

that the primary definition, as prohibited by Sections 203 and

204 of BCRA, is not narrowly tailored to serve that

compelling government interest and is overbroad as a matter

of constitutional law. It is this contention to which I now turn.

2. Sections 201, 203, and 204 of BCRA, are

Narrowly Tailored to Serve Compelling

Governmental Interests

I find that BCRA’s prohibition of corporate and labor

union spending of general treasury funds on electioneering

communications, as defined in the primary definition, is

narrowly tailored to serve the aforementioned compelling

governmental interests. In reading the floor debates leading

"°° The NRA also argues that Title II cannot be justified as essential to

prevent circumvention of Title I, NRA Opp’n at 13-15. Because I find that

the first two rationales asserted by the government are sufficient, I do not

need to reach whether this rationale constitutes a compelling

governmental interest. Consequently, I decline to reach the NRA’s

argument on this point.

841sa

up to BCRA’s passage, I am impressed by the care with

which Congress crafted BCRA’s delicate balance between

regulation of issue advocacy and electoral advocacy, carefully

weighing the serious First Amendment interests at stake.

With Title Il, Congress created an objective, impartial

approach based on empirical data that provides objective

indicia for distinguishing between electioneering advertise-

ments and genuine issue discussion.

a. Introduction

In briefing this issue, Plaintiffs take great pains to

exaggerate the reach of BCRA’s electioneering communica-

tion provision-a technique no doubt designed to assist their

efforts at demonstrating overbreadth. By so doing, Plaintiffs’

distort the actual reach and purpose of Title II. See, e.g., NRA

Br. at 5 (presenting the law as a close relative of the

universally condemned Sedition Acts of 1798). Given the

extent to which Plaintiffs contort Title II to serve their own

rhetorical purposes, it is necessary to state once again what

BCRA does and does not accomplish in Title II.

The primary definition in section 201 is specifically

focused on the pressing problem of corporations and labor

unions using general treasury funds to directly influence

federal elections under the guise of issue advocacy. Plaintiffs

dismiss the primary definition in Title II as a “sweeping”

“condemnation of core political speech,” McConnell Opp'n at

43, and characterize the restrictions in Title II as

“staggeringly overbroad.” McConnell Br. at 59. Despite these

statements, the primary definition of “electioneering

communication” includes only communications that fulfill

four, very discrete components: (a) they must be disseminated

by cable, broadcast, or satellite, (b) they must refer to a

clearly identified Federal candidate, (c) they must be

distributed within 60 days before a general election or 30

days before a primary election, and (d) they must be targeted

842sa

to the relevant electorate. BCRA § 20I(a):

§ 304(f)(3)(A); 2 U.S.C. § 434((3)(A). (a); FECA

Furthermore, Section 201 also contains a provision which

expressly exempts four additional classes of communication

from both the primary and backup definitions of

electioneering communication. The four categories excluded

from the definition of electioneering communication are:

(i)a communication appearing in a news story

commentary, or editorial distributed through the

facilities of any broadcasting station, unless such

facilities are owned or controlled by any political part

political committee, or candidate; '” ‘

(ii) a communication which constitutes an expenditure or

an independent expenditure under . . . [FECA];'7’

(iii) a communication which constitutes a candidate

debate or forum conducted pursuant to regulations

adopted by the Commission, or which solely promotes

such a debate or forum and is made by or on behalf of

the person sponsoring the debate or forum: or

(iv) any other communication exempted under such

regulations as the Commission may promulgate (consis-

1

. ” The first Statutorily-created exemption is almost identical to a pre-

existing provision of FECA, 2 U.S.C. 431(9)(B)i), that excludes from the

definition of “expenditure” news stories and editorials broadcast or

published by the media. 2 U.S.C. § 431(9)(B)(i) (“[Expenditure does not

include] any news story, commentary, or editorial distributed through the

facilities of any broadcasting station, newspaper, magazine, or other

periodical publication, unless such facilities are owned or controlled b

any political party, political committee, or candidate.”). The parties heed

referred to this carve-out as the “media exemption.” See infra.

127 4

This exemption prevents double reporti

rng 5 porting of an electioneerin

communication if it already constitutes an expenditure or eee

png ot hee the Act. Electioneering Communications, 67 Fed Reg

, 65,197-98 (October 23, 2002) (to be codifi ER.

§ 100.2%c)(3)). codified at 11 C.F.R.

843sa

tent with the requirements of this paragraph) to ensure

the appropriate implementation of this paragraph, except

that under any such regulation a communication may not

be- exempted if it meets the requirements of this

paragraph and is described in section 301(20)(A)(iii)

{which is a public communication that refers to a clearly

identified candidate for Federal office (regardless of

whether a candidate for State or local office is also

mentioned or identified) and that promotes or supports a

candidate for that office, or attacks or opposes a

candidate for that office (regardless of whether the

communication expressly advocates a vote for or against

a candidate)].

BCRA § 201(a); FECA § 304(f)(3)(B); 2 U.S.C. § 434(f)

(3)(B). The final exemption in Section 201 provides the

Commission with authority to promulgate further regulatory

exemptions to the definition of “electioneering communica-

tion.” However, the Commission’s ability to create further

regulatory carve-outs is closely circumscribed. First, any

future exemption must be consistent with the requirements of

the electioneering communication provision. Second, a

communication cannot be exempted if it is a “public

communication” “that refers to a clearly identified candidate

for Federal office . . . and that promotes or supports a

candidate for that office, or attacks or opposes a candidate for

that office.” BCRA § 101(b); FECA § 301(2)(A)(iii);

2 U.S.C. § 431(20)(A)iii). As this latter limitation essentially

tracks the language of the fallback definition, the statute

appears to require the Commission not to stray from either

definition of electioneering communication when promulgat-

ing future exemptions.”

28 Since the passage of BCRA, the Commission has promulgated two

exemptions to the definition of electioneering communication. The first,

exempts communications paid for by candidates for state or local office

where the mention of a Federal candidate is “merely incidental” and thus

not in violation of Section 301(20)A)iii) of FECA. Electioneering

844sa

_ Plaintiffs present two overbreadth challenges to Title II.

First, Plaintiffs argue that the primary definition of

clectioneering communication applies to too many genuine

issue advertisements to be considered narrowly tailored.

McConnell Br. at 57-69; McConnell Opp’n at 42-48;

McConnell Reply 33-40; NRA Br. at 17, 24-33; NRA Opp'n

at 17-25; NRA Reply at 22-25; ACLU Reply 7-10; AFL-CIO

Reply at 8-9. Second, Plaintiffs contend that Title II is

unconstitutional because it applies to all corporations and

does not contain a special statutory carve-out for non-profit,

MCFL-type corporations. McConnell Opp’n at 41-42; NRA

Br. at 17-24; ACLU Br. at 16-17; see also NRA Reply at 14-

20; ACLU Reply at 2-7.

Communications, 67 Fed.Reg. at 65, 198-99 (to be codified at 11 C.F.R.

100.29(c\(5)). The second, exempts communications paid for by any

charitable organization operating under Section 501(c)(3) of the Internal

pet Code, which by law are not permitted to engage in partisan

political activity. /d. at 65,199-200 (to be codified at 11 C

ae lem C.F.R.

Four of the McConnell Plaintiffs are Section 501(c)(3) organizations.

McConnell Second Am. Compl. 4{ 30, 32, 36, 37 (identifying the

Indiana Family Institute, Inc., the National Right To Life Educational

Trust Fund, the Southeastern Legal Foundation, Inc., and U .S. d/b/a Pro-

English as 501(c)(3) organizations). Given the FEC’s regulations, I find

that Court does not have jurisdiction over these four Plaintiffs on both

standing and ripeness grounds. These four Plaintiffs do not demonstrate

any injury-in- fact, a necessary prerequisite of standing. Lujan v.

Defenders of Wildlife, 504 U.S. 555, 560-61 (1992) (Plaintiffs have the

burden of establishing standing to bring their suit by demonstrating that

they have: (1) suffered an “injury in fact,” (2) which is “fairly traceable to

the conduct complained of,” and (3) is capable of judicial redress.).

Moreover, as Plaintiffs have presented “a controversy that has not yet

arisen and may never arise,” Wisconsin Right to Life v. Paradise, 138 F.3d

1183, 1187- 88 (7th Cir.1998), their claim is not ripe and the Court lacks

Jurisdiction to resolve their specific challenge to the electioneering

communications provision. Accordingly, I do not believe that the Court

has any jurisdiction over the claims of these four Plaintiffs in relation to

the electioneering communication provisions in Title II.

845sa

b. BCRA’s Restrictions on Electioneering Communication

is Narrowly Tailored

The restrictions in Title H on _ electioneering

communications, as defined in the primary definition, are

narrowly tailored. As discussed supra, Congress can

permissibly regulate beyond express electoral advocacy only

by ensuring that the law does not unconstitutionally burden

issue discussion. In creating Title II of BCRA, Congress

created a bright-line test that focuses on objective criteria

common to broadcast advertisements that directly influence

federal elections. By constructing this bright-line test, and

avoiding a test that rests on subjectivity, Congress not only

avoided the vagueness problems that plagued FECA, but also

specifically linked their findings of abuse of Section 441b to

the provisions in the primary definition. By using the main

indicators of abuse—broadcast advertisements, aired in close

proximity to a federal election, containing a reference to a

candidate, and targeted to the candidate’s electorate—

Congress created a clear rule that constitutionally

distinguishes between electioneering advertisements and

genuine issue advertisements in the overwhelming majority

of cases. |

The Findings conclusively demonstrate that genuine issue

advocacy is empirically distinguishable from issue advertise-

ments seeking to influence a federal election. Findings q 2.8.

The vast majority of issue advertisements designed to

influence a federal election identify a federal candidate, are

run sixty days prior to a general election, or thirty days before

a primary election, and are run in states or congressional

districts with close races. I shall briefly examine each of these

in turn.

1) Issue Advertisements Designed to Influence a Federal

Election Almost Always Identify a Federal Candidate

The record in this case conclusively establish that issue

advertisements designed to influence a federal election almost

846sa

always refer to a specific federal candidate. /d. 4 2.8. Political

consultants who create genuine issue advertisements present

uncontroverted testimony that when designing pure issue

advertisements, “it was never necessary . . . to reference

specific candidates for federal office in order to create

effective ads.” Jd. 2.8.1.1 (Bailey) (discussing examples);

see also id. (Strother) (pure issue ads did not mention any

candidates by name). The flip side of this coin, as the

consultants allude to in their testimony, is that when

advertisements do mention a candidate’s name, particularly in

the period preceding an election, the advertisement’s primary

purpose is usually to influence the election. /d. (Bailey) (“In

my decades of experience in national politics, nearly all of the

ads that I have seen that both mention specific candidates and

are run in the days immediately preceding the election were

clearly designed to influence elections.”); id. (Strother)

(“Indeed, there is usually no reason to mention a candidate’s

name unless the point is to influence an election.”). Expert

testimony concurs in the views of the political consultants. /d.

q 2.8.1.2 (Krasno & Sorauf) (“The most obvious characteris-

tic shared by candidate ads and candidate-oriented issue “ads

is their emphasis on candidates . . . . Pure issue ads, on the

other hand, were much less likely to mention a candidate for

federal office . . . .”) (Krasno & Sorauf); § 2.8.4 (Magleby)

(“A number of indicia make clear that the ads run by

individuals and interest groups are in reality electioneering

ads that are meant to influence, and do influence, elections:

These electioneering ads generally name a candidate . . . .’’).

This point is driven home by additional evidence, which

demonstrates that advertisements run in the sixty days

preceding a general election overwhelmingly mention a

federal candidate and those run outside that period

overwhelmingly do not mention a federal candidate. /d.

{ 2.8.1.3 (discussing advertisements by Citizens for Better

Medicare, Chamber of Commerce, Planned Parenthood,

AFL-CIO, EMILY’s List, Americans for Job Security,

847sa

Business Round Table, Handgun Control, Sierra Club, and

League of Conservation Voters). These facts strongly suggest

that true issue advocacy need not mention a candidate’s name

to be effective, and that when advertisements mention a

federal candidate, they are likely to be aired in close,

temporal proximity to an election as part of an effort to

influence that election. This pattern is manifested repeatedly

in other issue advocacy organizations’ campaigns, demon-

strating in an objective and unbiased manner the fact that

most advertisements designed to influence federal elections

refer to a federal candidate.'*? Id. By focusing on those

advertisements that specifically refer to a federal candidate,

Title II of BCRA appropriately targets issue advertisements

that are designed to influence an election.'*° /d. ¢ 2.8.1.4.

2) A Majority of Candidate-Centered Issue Advertisements

are Run in the, Sixty Days Prior to a General Election and

Thirty Days Prior to a Primary Election

The Findings also overwhelmingly demonstrate the

appropriateness of BCRA’s sixty and thirty day benchmarks.

While advertisements appearing outside these time frames

can influence elections, Congress appropriately focused on

the periods of time that most directly influence federal

'29 No similar evidence was presented by Plaintiffs to show an opposite

trend or pattern.

' Moreover, BCRA appropriately leaves untouched advertisements

paid for with corporate and labor union general treasury funds that do not

refer to a federal candidate. For example in the 63 days before the 2000

election, Citizens For Better Medicare ran 14,975 advertisements, of

which 4,099 did not mention a federal candidate. Findings { 2.8.1.3. None

of these advertisements that did not mention a federal candidate would be

covered under BCRA. However, the 6,000 advertisements that mentioned

a federal candidate and that were aired in the final three weeks of the 2000

election potentially would need to be paid for with segregated funds if the

advertisements met the other criteria of the primary definition to be

considered “electioneering communication.”

848sa

elections. /d. ¥ 2.11.1. The Annenberg Study. whi

challenged by Plaintiffs, and was relied sy Peis

experts, as well as by Congress, concluded that during the

2000 federal election “{flully 94% of issue ads aired after

August made a case for or against a candidate.” /d. q 2.8.2.1

As the following chart from the findings illustrates issue

advertisements that mention a federal candidate dramatically

increase in the period before a federal election. In this case

the picture tells the entire story: )

by Kenneth Goldstein illustrates this point:

All interest Group Advertisements Over Time

16000

14000

12000

10000

= 8000 7

; 6000 [

a. At

2000

0 - ut a,

39 29 19 9

“ 34 24 14 4

—nanes Number of Ads With No Candidate Mention

Number of Ads Mentioning e Candidate

Id. { 2.8.2.2. In addition, uncontroverted expert testimony in

this case confirms that issue advertisements aimed at

influencing federal elections are aired in the period right

before an election. /d. 4 2.8.2.3; id. (Goldstein) (“The CMAG

database provides empirical evidence of a strong positive

correlation between [an advertisement’s reference to a federal

candidate and the proximity in time of the broadcast of the

advertisement to the federal election] and consequently of its

849sa

validity as a test for identifying political television advertise-

ments with the purpose or effect of supporting or opposing a

candidate for public office.”). The evidence establishes that

Congress was correct to conclude that sixty days before a

federal election is the time corporations and labor unions

have sought to use their general treasuries to influence federal

elections. See Findings § 2.8.2.4.

The thirty-day benchmark is similarly narrowly tailored.

Plaintiffs complain that no analysis of narrow tailoring “exists

as to ads broadcast within 30 days of primaries or conven-

tions, and defendants appear to have abandoned any

contention that there is any basis in experience to prohibit

such advertisements.” AFL-CIO Reply at 3 n.2. This argu-

ment is incorrect; Defendants have put forth evidence

concerning BCRA’s thirty-day window and Plaintiffs have

done nothing to contradict or challenge the evidence. As the

Findings establish, Defendant-Intervenors were the only party

to actually study the impact of BCRA on advertisements run

during the 2000 primary election period. Findings § 2.11.5.3.

The Defendant-Intervenors found only 76 distinct advertise-

ments which aired more than 60 days before the general

election from the CMAG database, comprising 16,916

airings. Id. Of these advertisements, only three percent of the

airings (522 out of 16,916) named a candidate and were aired

within 30 days of the candidate’s primary. Id. Defendant-

Intervenors observed that of the advertisements identifying a

candidate and airing within 30 days of a 2000 primary

election, only 1.2 percent were coded as “genuine issue

advertisements.” Jd. Defendants’ experts Krasno and

Soraufmake a similar finding. Jd. 4 2.11.5.2. These experts

observe that the “hodgepodge of different primary dates

makes it difficult to factor [the 30 day primary window] into

the analysis, but we are confident that it would have little

effect on the proportion of pure issue ads incorrectly captured

by BCRA for the simple reason that so few of these

advertisements mention candidates at all. Indeed, our exami-

850sa

nation of 1998 shows this to be true: no pure issue ads would

have been captured by the 30-day primary period.” Jd

Plaintiffs make absolutely no effort to challenge this data and

I find the evidence sufficient to demonstrate that the thirty-

day time frame is supported by the record in this case.

Indeed, the closest Plaintiffs come to challenging

Defendants’ on this point is the AFL-CIO’s citation to 336

cookie-cutter advertisements aired over three election cycles

only 50 of which would have been even covered by BCRA’s

provisions. Findings 4 2.11.5.1. I discuss these advertisements

in more detail, infra, however it is clear that this evidence

represents the political advertising activity of only one

interest group, albeit a particularly active one. As such, this

submission does not directly address Defendants’ analysis

which examines BCRA’s effect on issue advocacy during the

primary cycle in general. I, therefore, find that this AFL-CIO

evidence does not change my finding that BCRA’s thirty-day

period is supported by the record as being narrowly tailored

to achieve the governmental interest at stake.

Moreover, Defendants provide uncontroverted evidence

that the effect of advertisements run during a primary can be

just as damaging as advertisements run during the general

election. The record demonstrates that interest group

broadcast advertisements had a substantial effect on the

outcome of the 2000 Congressional race in Florida’s Eighth

district, particularly with the advertisements run by The Club

for Growth during the primary. /d. 4 2.6.5.5 (Pennington); see

also id. | 2.10.2 (Pennington) (noting that radio advertise-

ments by Americans for Limited Terms attacking Mr

Keller's opponent on taxes and other issues was quite

effective). The Club for Growth and Republican candidate

Ric Keller had made their relationship well known, and the

Club for Growth ran advertisements particularly helpful to

Mr. Keller including one entitled “Keller Sublette Higher

Taxes.” Id. § 2.6.5.5 (Pennington). Keller’s Republican

primary opponent, Bill Sublette, had been the front-runner

85lsa

until this advertising campaign by The Club for Growth

began. Jd. Rocky Pennington, Mr. Sublette’s campaign

consultant, observed that Sublette would have garnered 50

percent of the vote in the Republican primary and not have

had to face a run-off primary contest had it not been for The

Club for Growth advertisements. /d.

After the election, in June of 2001, Congressman Ric

Keller signed a Club for Growth fundraising letter stating:

The Club for Growth selected my race as one of its top

priorities . . . . Since the Club targets the most

competitive races in the country, your membership in the

Club will help Republicans keep control of Congress.

Id. 4 4 2.7.4 (underline in original, italics added for empha-

sis). In my judgment, the Keller-Sublette primary election

advertising example epitomizes the reason Congress extended

the prohibition on electioneering communications to 30 days

within primary elections. It also demonstrates that simply

because a primary election does not ultimately produce an

officeholder, since the winner only receives a chance to run

for elected office, the risk of corruption is still clearly present.

See Findings § 2.6.6.5 (New Hampshire Presidential primary

election advertisements referencing Senator McCain). The

thirty-day prohibition around primaries is therefore supported

by the record.

The sixty and thirty-day figures are not arbitrary numbers

selected by Congress, but appropriate time periods tied to

empirically verifiable data. The Findings persuasively

demonstrate that advertisements designed to influence

afederal election mention the name of a candidate and appear

in the sixty and thirty days before a federal election or

primary contest. The primary definition of electioneering

communication is narrowly tailored because it focuses only

on these periods of time, where it has been shown that

candidate-centered issue advocacy is at its zenith and the

influence of these advertisements on federal elections is at its

852sa

strongest. Indeed, expert testimony likewise concludes that

the majority of issue advertisements that mention a federal

candidate appear in the period before an election. /d.

q 2.8.2.3.

Unlike Judge Leon, I am equally unpersuaded by

Plaintiffs’ claim that the legislative calendar requires the

running of issue advertisements during the periods covered by

BCRA. See, e.g., AFL-CIO Br. at 10-11; Findings 4 2.11.8. I

do not find that Plaintiffs have presented sufficient evidence

to demonstrate this proposition. Findings ] 2.11.8.3. In many

instances, Plaintiffs conclusively allege that legislative

activity occurs during this time frame without providing

either specific examples from the legislative calendar or

examples from their own issue advertising campaigns

addressing these legislative issues. Jd. | 2.11.8.1. The actual

examples of some advocacy tied to specific pending

legislation Plaintiffs present are comparatively few and I

conclude are not sufficient to demonstrate that BCRA is

overbroad. /d. 4 2.11.8.2. Importantly, Plaintiffs never

overcome the fact that all issue advertisements that refer to a

federal candidate, that are run in close proximity to a federal

election, and that are targeted to the candidate’s electorate

influence the outcome of the federal election. Jd. 9 2.11.2.

Nor do they overcome the evidence showing that most “pure”

issue advertisements do not mention the name of federal

candidates. Id ¥ 2.8.1.1. Congress properly concluded that

advertisements mentioning a candidate run in this time frame

have an electioneering affect, even if they are run for a

different purpose, and if these advertisements were paid for

by corporations and labor unions, Congress concluded,

consistent with longstanding policy, to require that these

advertisements be paid for with segregated funds specifically

designated for election purposes.

. Additionally, the record establishes that it is a disputed

issue of fact as to whether it is even effective to run

853sa

“genuine” issue advertisements in the immediate run-up to a

federal election. Findings § 2.11.7. Political consultants,

current and former candidates and officeholders, and

Defendants’ expert witnesses contend that it is ineffective to

run issue advertisements in close proximity to a federal

election, and as a result, advertisements about issues run

during that time frame are likely designed to influence federal

elections. /d. 9§ 2.11.7.1-2.11.7.2. Plaintiffs respond that it is

necessary to run issue advertisements that mention the name

of a federal candidate close to an election because of the

public’s greater interest in public affairs during that time

frame. Id. $§ 2.11.7.3-2.11.7.4. Because this issue 1s disputed,

I reach no conclusion on this matter. What I do conclude

is that with the primary definition of electioneering

communication, the test does not focus on the objective

behind the advertisement but rather objective determinants

that have been empirically proven to distinguish issue

advertisements that influence federal elections from other

types of issue advertising.

Given the record presented to the Court, I conclude that

BCRA captures the overwhelming majority of advertisements

that are designed to affect federal elections. Even if the

primary purpose of a broadcast advertisement is to pressure a

Member of Congress on pending legislation, the record

demonstrates that advertisements mentioning a federal

candidate that run in close proximity to a federal election that

are targeted at that candidate’s electorate have a serious

impact on elections. Still, BCRA only requires that these

advertisements be paid for with segregated funcs as opposed

to general treasury funds.

3) Most Candidate-Centered Advertisements That Mention

a Candidate for Federal Office Are Run in States and

Congressional Districts With Close Elections

The Court’s Findings conclusively demonstrate from the

evidence that issue adve

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