This month’s cover illustration is yet another example in our now-long-running series about how Artificial Intelligence represents the Federal Election Commission. For several months, PPLI has been attempting to convince various AI illustration programs to portray pictures or other representations of the six Commissioners of the Federal Election Commission. We have given up trying to get AI programs to understand that when we ask for “all Commissioners” or “all six Commissioners” we probably want to see SIX Commissioners, not five, or nine, or something other than six. So, we’re trying just one Commissioner to make it easier for the programs to understand. Because she appears prominently in two of this month’s Highlights (see, e.g.,  Citizens for Responsibility and Ethics In Washington v. FEC, No. 22-cv-3281 (CRC), Sept. 20, 2023 (“if Commissioner Weintraub’s statement is, indeed, the ‘equivalent of a boxer taking a dive,”)), we chose Commissioner Ellen Weintraub; the choice and resulting image was quite well-received by some members of the First Tuesday Lunch Group (and no one complained). The text prompt used for this month’s version was “Federal Election Commission Commissioner Ellen Weintraub, dressed in red, white and blue boxing trunks;” the program used was a new beta (experimental preview) version of Microsoft Office’s AI-powered Designer Program in generate image mode, using a cyberpunk style. The actual AI program behind Microsoft’s Designer program appears to be the well-known and well-developed DALL-E program, although it is unclear which version is being used.

GOVERNMENT CENSORSHIP OF ALLEGED “DISINFORMATION:”

U.S. Court of Appeals for the Fifth Circuit, Like the District Court in Missouri v. Biden Injunction, Finds That Federal Agencies Violated the First Amendment By Coercing Social Media Companies to Censor The Views of “Millions of Americans.” Justice Alito Stays Injunction Pending Review of DoJ Request. And MUCH MORE: If you only read media coverage of the 74-page per curiam opinion from the Fifth Circuit Court of Appeals in Missouri v. Biden, upholding a lower court ruling that the White House, FBI, and other federal officials violated the First Amendment by coercing and “significantly encouraging” social media companies to censor social media postings that didn’t match the federal officials’ views, you probably think that the Fifth Circuit “threw out nine of [the District Court’s rulings] and modified the 10th to limit it.” That is true, at least at first, but may be misleading. Yes, the Fifth Circuit rewrote the language of the injunction to limit it to certain federal officials and to be more specific and clear about what was being enjoined. But the Fifth Circuit has now decided to reconsider whether the injunction should not have been so narrow and should have covered more of the federal agencies that played a part in “a coordinated campaign of this magnitude orchestrated by federal officials that jeopardized a fundamental aspect of American life.” Slip op., at 61 (emphasis added). There was some confusion over what and when the Fifth Circuit panel decided to reconsider (see below), with part of the confusion apparently coming from a mistake by the Court Clerk’s office.

Despite the confusion, the Fifth Circuit panel not only upheld the basic claim of a vast, organized federal effort to censor the speech of Americans, but gave the Supreme Court and practitioners a very clear lesson on how to evaluate pending challenges to government censorship such as the Petition for Certiorari pending in NRA v. Vullo, No. 22-842. This was a slam-dunk win for Missouri and the other plaintiffs, and a specific, full-throated denunciation of the federal officials’ actions. Slip op., at 61. 

Some excerpts:

There are two guiding inquiries for Defendants. First, is whether their action could be reasonably interpreted as a threat to take, or cause to be taken, an official action against the social-media companies if the companies decline Defendants’ request to remove, delete, suppress, or reduce protected free speech on their platforms. Second, is whether Defendants have exercised active, meaningful control over the platforms’ content-moderation decisions to such a degree that it inhibits the platforms’ independent decision-making.

Slip op., at 71. 

Under the modified injunction, the enjoined Defendants cannot coerce or significantly encourage a platform’s content-moderation decisions. Such conduct includes threats of adverse consequences—even if those threats are not verbalized and never materialize—so long as a reasonable person would construe a government’s message as alluding to some form of punishment. That, of course, is informed by context (e.g., persistent pressure, perceived or actual ability to make good on a threat). The government cannot subject the platforms to legal, regulatory, or economic consequences (beyond reputational harms) if they do not comply with a given request. See Bantam Books, 372 U.S. at 68; Okwedy, 333 F.3d at 344. The enjoined Defendants also cannot supervise a platform’s content moderation decisions or directly involve themselves in the decision itself. Social-media platforms’ content-moderation decisions must be theirs and theirs alone. See Blum, 457 U.S. at 1008. This approach captures illicit conduct, regardless of its form.

Id., (emphasis added). 

[T]he government is not permitted to use the government-speech doctrine to “silence or muffle the expression of disfavored viewpoints.” Matal, 582 U.S. at 235. It is true that the officials have an interest in engaging with social media companies, including on issues such as misinformation and election interference. But the government is not permitted to advance these interests to the extent that it engages in viewpoint suppression. 

Id., at 64 (emphasis added). 

[W]e emphasize the limited reach of our decision today. We do not uphold the injunction against all the officials named in the complaint. Indeed, many of those officials were permissibly exercising government speech, “carrying out [their] responsibilities,” or merely “engaging in [a] legitimate [] action.” Vullo, 49 F.4th at 718–19. That distinction is important because the state-action doctrine is vitally important to our Nation’s operation—by distinguishing between the state and the People, it promotes “a robust sphere of individual liberty.” Halleck, 139 S. Ct. at 1928. That is why the Supreme Court has been reluctant to expand the scope of the doctrine. See Matal v. Tam, 582 U.S. 218, 235 (2017) (“[W]e must exercise great caution before extending our government-speech precedents.”). If just any relationship with the government “sufficed to transform a private entity into a state actor, a large swath of private entities in America would suddenly be turned into state actors and be subject to a variety of constitutional constraints on their activities.” Halleck, 139 S. Ct. at 1932. So, we do not take our decision today lightly. But, the Supreme Court has rarely been faced with a coordinated campaign of this magnitude orchestrated by federal officials that jeopardized a fundamental aspect of American life. Therefore, the district court was correct in its assessment—“unrelenting pressure” from certain government officials likely “had the intended result of suppressing millions of protected free speech postings by American citizens.” We see no error or abuse of discretion in that finding.

Id., at 61-62 (emphasis added). 

Given all of the above, we are left only with the conclusion that the officials’ statements were coercive. That conclusion tracks with the decisions of other courts. After reviewing the four-factor test, it is apparent that the officials’ messages could “reasonably be construed” as threats. Warren, 66 F.4th at 1208; Vullo, 49 F.4th at 716. Here, unlike in Warren, the officials’ “call[s] to action”—given the context and officials’ tone, the presence of some authority, the platforms’ yielding responses, and the officials’ express and implied references to adverse consequences—“directly suggest[ed] that compliance was the only realistic option to avoid government sanction.” 66 F.4th at 1208. And, unlike O’Handley, the officials were not simply flagging posts with “no strings attached,” 62 F.4th at 1158—they did much, much more.

Id., at 51 (emphases added). 

The opinion is powerfully-written, clear and concise; its length is only because any consideration balancing the newly-expanded government speech doctrine against the rights of the targets of that speech is complicated, especially on expedited consideration of an injunction. The opinion clarifies and unifies recent judicial opinions reviewing whether a government can do indirectly what the First Amendment prevents it from doing directly (the actual question in Vullo) and brings together several of the most recent cases involving censorship efforts by federal and state officials in a way that outlines the key decisions for courts to consider. See, the two-step test from Slip op., P. 71,above.

For example, it helps to remember that most observers now realize that the Federal Election Commission lost the Citizens United case when the federal government asserted that it had the right to ban books, even though then-U.S. Solicitor General (now Justice) Elena Kagan tried to walk back the claim during the March 24, 2009, second oral arguments the Court ordered after the book-banning claim was uttered. In summarizing the case in Missouri v. Biden, the Fifth Circuit opinion said: 

Like in Bantam Books, the officials here set about to force the platforms to remove metaphorical books from their shelves. It is uncontested that, between the White House and the Surgeon General’s office, government officials asked the platforms to remove undesirable posts and users from their platforms, sent follow-up messages of condemnation when they did not, and publicly called on the platforms to act. When the officials’ demands were not met, the platforms received promises of legal regime changes, enforcement actions, and other unspoken threats. That was likely coercive. See Warren, 66 F.4th at 1211–12.

Slip op., at 43-44. 

This is not the end of the line for Missouri v. Biden. Far from it, as the case changes day-by-day (see below). The Department of Justice, faced with humiliating repudiation of its earlier positions, has pushed the case to the Supreme Court. But this is just an early procedural decision on an injunction, not a decision after the parties’ evidence and legal theories have been tested in a full trial. Such a trial would likely be long and complicated, but the legal expertise from the parties and their supporting amici is formidable and would likely raise many sophisticated questions; the number of pages and other evidence filed in the case already numbers in the tens of thousands. The question is whether the Supreme Court is willing to take up this case on the so-called “shadow docket” of expedited consideration before a full trial, especially since it could look at the exact same question with a full evidentiary record in Vullo; with the latest procedural wrangling, including the rehearing of the Petitioner’s request to restore much of the narrowing of the injunction (see below), the timetable for Supreme Court action has almost certainly been pushed back. 

Either way, the federal officials involved face the court of public opinion after an extensive review by two courts has resulted in not one, but two official verdicts of violating the First Amendment rights of “millions of protected free speech postings by American citizens.”

Justice Alito Grants Temporary Administrative Stay of Fifth Circuit Injunction in Missouri v. Biden: On Friday, Sept. 8 the Fifth Circuit found that federal agencies and officials had violated the First Amendment but stayed its ruling to allow the federal defendants to request relief from the Supreme Court. The Department of Justice did file a request from the Supreme Court for a stay of the Fifth Circuit’s ruling while it prepared a Petition for Certiorari that it intended to file in October. The case number for the expedited review request is No. 23A243. 

Note that the Solicitor General has removed President Biden’s name from the case title, and is calling the case Missouri v. Murthy. Vivek Murthy is the Surgeon General of the United States and one of the enjoined federal officials alleged to have engaged in the sweeping censorship scheme found by the District Court. Footnote * on page iii of the Application for the Stay of the injunction points out that the District Court did not “enter injunctive relief against” President Biden. It is customary for the Supreme Court to use, at least at the outset of a proceeding, the names as offered by the parties in their pleadings.

Justice Alito, for the Court, immediately granted a stay, but only for a short period. Justice Alito’s administrative stay doesn’t mean he favors a stay; it just allows the other side to present their case. 

The 44-page DoJ request to the Supreme Court for a stay was essentially a recap of its position before the Fifth Circuit, denying that there was any threat or coercion by the government officials, denying that the Plaintiffs had standing, and denying that there was any First Amendment injury both because any injury came from independent action by the social media companies and because the State Plaintiffs had no First Amendment rights. One of the more interesting standing positions in the DoJ Request is that it rests on the federal agencies’ government speech rights, which it describes as the “bully pulpit:” “A central dimension of presidential power is the use of the Office’s bully pulpit to seek to persuade Americans – and American companies – to act in ways that the President believes would advance the public interest.” P. 3. Later, it denies that the States have similar rights: “The States lack First Amendment rights.” P. 34. 

DoJ did admit that “Of course, if the government had actually coerced the platforms to suppress speech, that coercion would plainly violate the platforms’ First Amendment rights.” P. 33. In an op-ed in The Hill, Nadine Strossen and Joe Cohn, as evidence of coercion, cited a July 28 tweet from House Judiciary Committee Chair Jim Jordan releasing a Facebook email exchange on why the company changed its position on whether the Covid-19 virus was lab-made (now thought to be a legitimate topic of debate, including by federal agencies):

Does the “bully pulpit” emphasize “pulpit” or “bully?” And whose idea was it to label it that way in a pleading?

Don’t Blink Or You’ll Miss Something In Missouri v. Biden: The case swiftly rolls on, gathering yet more complexity as it goes. (Of course, “swiftly” has different meanings in judicial proceedings, as compared to, say, superstars running off stage.)

The Plaintiffs asked the Fifth Circuit panel which narrowed, but upheld the District Court’s injunction to rehear the case and reconsider whether the injunction should have been modified quite so much. Then things got confusing. First, on September 25, in a one-sentence Order, the panel appeared to decide to rehear the case as Plaintiffs had requested. But this turned out to be an error in the Court Clerk’s office, since the federal defendants had not responded to the request for rehearing. The Solicitor General then filed a supplemental brief with the Supreme Court complaining that the Fifth Circuit panel didn’t ask the federal government for its views before granting the rehearing: “Whether or not the Court grants certiorari immediately, however, the government respectfully submits that the irregularity of and additional un-certainty caused by this most recent development provide powerful additional reasons to stay the district court’s preliminary in-junction in its entirety.” (Though appellate court clerks’ offices do a good job most of the time, they do make mistakes from time to time.) So, the Fifth Circuit issued another order withdrawing the September 25 Order and requiring the Department of Justice to file a responsive brief by Thursday, September 28.

Supreme Court Grants Certiorari (Review) of Florida and Texas Social Media Cases: When the Supreme Court takes its annual summer break, requests for the Court to review various lower court cases on certiorari pile up. The Court now sets aside the last week in September to review all those cases in what has now been dubbed “The Long Conference,” because it lasts several days. Among the twelve Petitions granted in the September 26 Long Conference were two similar cases from Florida and Texas challenging new State laws regulating social media companies. Amy Howe, from ScotusBlog and Howe on the Courts, has more on these social media company cases, and on the rest of the newest cert grants.

No Word From the Supreme Court on Cert Petition in NRA v. Vullo: As of September 29, 2023, there has been no word from the Supreme Court’s long conference on the Certiorari Petition in NRA v. Vullo, No. 22-842, challenging New York State’s attempt to strangle a tax-exempt organization by coercing its banks and insurers into dropping the organization as a client. The issue is the same as discussed in Missouri v. Biden above, except on the State level: did the government try to convince or coerce third-parties not to support or assist the speech of those whose message the government wanted to silence? The case was originally scheduled to be conferenced in May, then delayed until the September 26 “Long Conference.” It sometimes takes a while for the Clerk’s office to release the orders denying cert or the appearance of Petitions held over until later conferences.

Stewart Baker Captures The “Government Speech” Doctrine in Four Cybertoon Panels: Want a succinct summary of the federal government’s position in Missouri v. Biden?

Or, if you prefer a more scholarly view, how about a recent law review article from Univ. of Miami Law Prof. Caroline Mala Corbin’s Government Speech and First Amendment Capture, 107 Va. L. Rev. Online224 (2021):

In earlier decades, scholars worried that the government’s speech might monopolize a marketplace and drown out opposing viewpoints. But today, using a move I term “First Amendment capture,” the government need not be the loudest speaker because it can become the only speaker. First Amendment capture has been made possible by the Supreme Court’s developing government speech doctrine, which holds that government speech is not subject to the Free Speech Clause. Consequently, once speech is declared governmental, the government may censor viewpoints it does not like. First Amendment capture—categorizing contested speech as government speech and then eliminating contrary viewpoints—is an increasingly frequent occurrence and risks giving the government too much power to suppress those who would criticize it or blow the whistle on it.

And Columbia Professor Phillip Hamburger, CEO of the New Civil Liberties Alliance which represents plaintiffs in Missouri v. Biden,  explains in the Wall St. Journal why the government’s censorship affects all Americans.

One of the solicitor general’s arguments in the government’s defense is that the well-documented injuries to the plaintiffs, who were direct targets of the censorship, don’t justify a broad injunction that “covers the government’s communications with all social-media platforms . . . regarding all posts by any person . . . on all topics” (emphasis in original). But the censorship harmed all Americans, and the injunction is fully justified. Government officials repeatedly made public statements demanding censorship from the platforms. The announced policy was grossly overbroad. It thereby has directly tended to chill the speech of vast numbers of Americans, quite apart from the suppression that the government obtained through the platforms. Anyone with views opposed to the administration has had reason to temper what he says to avoid being deplatformed, demonetized or deboosted.

For a Perspective From the Platforms’ Side, Watch Rick Hasen’s Webinar on “How Should Platforms Handle Election Disinformation:” On September 26, 2023, UCLA Law Professor Rick Hasen’s “Safeguarding Democracy Project” presented a webinar featuring former social media company employees who handled election disinformation, including

• Katie Harbath (Anchor Change)
• Josh Lawson (Advisor to the Aspen Institute on A.I. and democracy-related risk, formerly of Meta and General Counsel for the North Carolina State Board of Elections)
• Yoel Roth (formerly of Twitter/X)
• Brandon Tucker (Color of Change).

This insider panel offered a distinctly different view from most of those involved in the legal cases or the various legislative inquiries: that the employees of tech companies are now victims of a “strategic response” that targets them, as Yoel Roth noted, in what is actually an “effective way to target multi-billion dollar companies too big to regulate” since the employees are the “single vulnerability” in such companies. The former employees, all of whom had many years in this industry, bemoaned the shift in social media companies’ reputations over the years from one where they felt like “white knights” protecting and expanding democracy through “tech” to one in which they were pawns under pressure from all sides in a “no-win” scenario that never ends. Katie Harbath described the shift as from “carrots and glimmer” (another name for incentives) offered before 2016 to today’s threats and coercion.

One of the most impressive things about the panel was the uniformity in perspective and definition of the problems they faced (though this may have been simply a function of the social circles in which they are immersed). One of the most interesting things was that this was a group of forty-something former powerful officials recounting how they realized that their companies were not, in fact, all-powerful or all-knowing. Like so many governmental officials in similar positions, they described just feeling their way forward through trials and tribulations, pressed by hostile forces on all sides. Roth announced that he would be writing “a paper” on his experience.

Center For Democracy and Technology Report on “Seismic Shifts” in “Counter-Election-Disinformation Initiatives” Offers Both Commentary and Possible Remedies:The Center for Democracy and Technology, founded in 1994, has just released a new study on how efforts to counter “Disinformation” in campaign finance and election laws. CDT has interviewed 31 individuals with experience in social media platform censorship and independence research about their experiences responding to election “disinformation” and “the growing challenges they face.” Some of the material reflects the same concerns as the UCLA webinar described above, and includes some discussion of Missouri v. Biden: “Governments should clarify and be more transparent about their role in responding to election disinformation—especially in the aftermath of the injunction issued in the case of Missouri v. Biden. They could explicitly set boundaries and transparency requirements around federal government communications with social media platforms and independent researchers.”

FEC

First House Administration Oversight Hearing for FEC in 12 Years: The Committee on House Administration is usually a sleepy venue, but it woke up on September 20 to hold its first oversight hearing on the Federal Election Commission since 2011. In his opening statement, Chairman Bryan Steil stressed the importance of the agency in maintaining Americans’ confidence in the integrity of federal elections, and pointed out that more than 100 Members have co-sponsored his American  Confidence in Elections Act, H.R. 4563. The ACE Act combines nearly 50 legislative proposals, including all of the legislative priorities the FEC sent to Congress, and faces opposition from, among others, the Brennan Center and Democracy Docket.

During the two-hour hearing, all six current FEC Commissioners gave statements and answered questions from Committee Members. Current Chair Dara Lindenbaum and Vice-Chair Sean Cooksey led the statements and answered most of the Committee’s questions, though Ellen Weintraub faced a barrage of feisty questions about her holdover tenure on the FEC of more than two decades and about media coverage of her supposed “strategy” to block FEC action in order to permit outside complainants to file suit against other outside groups. Weintraub bobbed and weaved like a prizefighter, refusing to say whether she held conversations with the White House and others about her possible replacement on the FEC and tried to explain her strategy for blocking FEC participation in defenses of its positions in court.

Latest Court Opinion in Long-Running CREW v. FEC Series of Cases “Encapsulates The Bureaucratic Morass That Has Become The FEC:” Some of the most terrifying words uttered recently in the U.S. District Court for the District of Columbia may be: “Citizens for Responsibility and Ethics In Washington v. FEC.” Or so it appears when Judge Christopher Cooper writes: “But just when the Court thought it was out of the fray, CREW and the FEC have pulled it back in.” Citizens for Responsibility and Ethics In Washington v. FEC, No. 22-cv-3281 (CRC), Sept. 20, 2023, slip op. at 6. An excerpt:

The eleven-year history of this case encapsulates the bureaucratic morass that has become the Federal Election Commission (“FEC” or “Commission”). In 2012, Plaintiff Citizens for Responsibility and Ethics in Washington (“CREW”) filed an administrative complaint with the Commission, alleging that Intervenor American Action Network’s (“AAN”) expenditures on political advertisements during the 2010 midterm election cycle rendered it an unregistered political committee. In 2014, the FEC dismissed CREW’s complaint. CREW petitioned this Court for review. And this Court remanded. In 2016, the FEC dismissed CREW’s complaint again on remand. CREW again petitioned this Court for review. And, in 2018, this Court again remanded. After the FEC failed to act on the remand, CREW sued AAN directly, as it was permitted to do under the Federal Election Campaign Act (“FECA”). But because the FEC’s initial decision dismissing CREW’s administrative complaint invoked, in passing, the Commission’s prosecutorial discretion, this Court held in 2022 that CREW’s latest complaint against AAN must be dismissed.

Slip op., at 1.

And that was just the first paragraph in a nine-page recitation of the twists and turns this complaint about the 2010 election took to reach this trial-level court opinion that is itself only a temporary waypoint in what promises to be a much longer judicial trail (or travail or simply trial, since this hasn’t even gotten to an ultimate trial). What was behind this Jarndyce v. Jarndyce-level multi-generational story? In simplest terms, Commissioner Ellen Weintraub, finding herself outvoted in a variety of cases, embarked on an epic battle to stop the FEC from acting so that the private parties could duke it out directly in federal court. As Judge Cooper put it in but one step of many: “A final twist: About a month after the FEC finally voted to close the AAN administrative file and notified the parties of that decision, Commissioner Weintraub, whose abstention in 2018 prevented the FEC from obtaining four votes to find reason to believe a violation had occurred, issued a Statement of Reasons explaining the basis for her vote.” Slip op., at 8.

And in a remarkable jiu jitsu reversal move, Weintraub’s simple abstention from voting turned what had been commonly-thought to be one of her losses – the use by three other Commissioners of an explanatory statement as an effective veto of FEC action – into a win in this small stage of a case by using a “explanatory statement” that was mostly a screed against other Commissioners’ positions without invoking the requisite magic words that had been empowered in other cases. See, e.g., slip op., at 37 n. 17. “Moreover, if Commissioner Weintraub’s statement is, indeed, the ‘equivalent of a boxer taking a dive,’ as AAN contends, AAN Mot. Dismiss at 27, the Court does not see why that fact would require dismissal of CREW’s complaint, as opposed to remand to the Commission for a new statement.”

It’s not just District Court judges who have to wrestle with these repetitive FECA-based fracases, but the D.C. Circuit too. Whether you think Commissioner Weintraub a creative avenging angel or a demonic wielder of arcane procedures, the D.C. Circuit is likely to weigh in, and that court, over many years, may have harbored a “libertarian” bias not to hew too-tightly to Supreme Court precedent. Which is why Judge Cooper stayed his own decision until the D.C. Circuit rules on yet another of the tangled cases involving the same organizations: CREW v. AAN, No. 22-7038 (D.C. Cir., Filed Mar. 29, 2023). Slip op., at 37. Stay tuned.

IFS Files Amicus Brief in CLC v. 45Committee Urging D.C. Circuit to Preserve Requirement For Bi-Partisan Agreement and Avoid Partisan Control of FEC: By statute, the FEC is bi-partisan; it takes four Commissioners’ votes to authorize enforcement action; the hobble is an intelligent design, since the agency is entrusted with enforcement of laws that may infringe on protected speech and association. As in several other cases, Campaign Legal Center v. 45Committee turns on who can control the FEC’s enforcement power: those who have at least four votes to authorize enforcement of complex campaign law violation allegations or those who block enforcement because they don’t have the votes of a majority of Commissioners. In 2022, after the FEC deadlocked on whether to defend itself, CLC filed suit against 45Committee, which it described as “a secret money group [sic] that spent as much as $38 million in 2016 to help elect former President Donald Trump,” alleging a failure to file as a political committee. Now the case has moved into the D.C. Circuit, and the Institute for Free Speech has filed an amicus curiae brief urging the appeals court to reject the CLC claim:

In many ways, the question here—whether the district court lacked jurisdiction because the FEC acted on the Campaign Legal Center’s administrative complaint—is an easy one. This Court’s precedent leaves little doubt that the FEC’s deadlocked vote constitutes an action under 52 U.S.C. § 30109(a)(8). That means the Center cannot establish the prerequisites for bringing a citizen suit under the Federal Election Campaign Act (FECA or the Act)—and so the district court correctly dismissed the complaint.

The Center resists this conclusion with a creative interpretation of FECA that turns the Act on its head. As the Center sees it, FECA allows a partisan minority of Commissioners to greenlight citizen suits simply by refusing to administratively close the file on a complaint. This theory is not just wrong—it fundamentally transforms the enforcement framework that Congress enacted, all at the expense of “the most fundamental First Amendment activities.” Buckley v. Valeo, 424 U.S. 1, 14 (1976).

Congress structured the FEC to make partisan enforcement impossible. With only six Commissioners evenly divided between Republicans and Democrats, tie votes are “baked into the very text of the statute.” Public Citizen, Inc. v. FERC, 839 F.3d 1165, 1170 (D.C. Cir. 2016). That decision reflects a serious concern that Congress had over the potential for partisan abuse inherent in regulating political speech. By setting non-enforcement as the default and requiring bipartisan agreement to depart from that baseline, Congress “uniquely structured the FEC” in way that guards against biased or overzealous enforcement. See id. at 1171.

The Center asks this Court to undo that careful structure and authorize a partisan bloc of Commissioners to hand enforcement power to private citizens. The Court should reject such a startling invitation and affirm the judgment below.

The Intercept Says That Proposal To Require FEC’s Office of General Counsel to Disclose Proposed Plans for Investigations Would “Gut the Agency:” The Intercept published an article,  A Trump Appointee is Trying to Gut the FEC’s Ability to Investigate Campaign Finance Crimes”, complaining about a new proposal from Commissioner Allen Dickerson to require the FEC’s Office of General Counsel to provide the Commissioner’s with its plan to conduct an investigation before the Commission considers whether to authorize OGC to begin enforcement proceedings. OGC has been without a permanent General Counsel since September 2016, when Lisa Stevenson, the Deputy General Counsel for Law, was appointed as Acting GC. During that time, OGC has had its trials and tribulations, particularly including some significant clashes with Commissioners over “the law” which is Stevenson’s major responsibility (she remains on the org chart as DGC for Law). 

For example, in MURs 7585/7588 (Trahan), Cong. Lori Trahan and her husband David had signed pre-nuptial agreements defining marital property before she ran for Congress, including real property purchased during the marriage. During her 2018 congressional campaign, she loaned her campaign $300,000 from her personal funds, and $71,000 from a home equity loan obtained in 2010. In a forewarning of the FEC OGC controversy, the Office of Congressional Ethics investigated the use of loan proceeds, but the House Rules Committee, which supervises OCE, found no ethical problem. OCE had failed to note that Massachusetts law governed the treatment of marital funds shared between partners; when House Rules looked at the same facts, they dismissed the complaint.

Deja Vu: Reviewing a complaint against the Trahan’s by the Campaign Legal Center, the FEC’s OGC came to a different legal conclusion from House Rules; like OCE, it ignored Massachusetts law, claiming that the use of the proceeds, mixed with the personal funds, meant that the entire $371,000 in campaign loans was an illegal excess contribution by David Trahan. And, not coincidentally, ignoring the fact that its claim could be described as an outdated conception of marital assets. Bad optics; worse law.

Fortunately, four Commissioners then rejected the OGC’s antediluvian theory, saying, in part, that: “The federal government should pause before scrutinizing the minute financial arrangements of married couples. This is so even where one of the spouses has been elected to federal office. And in the rare circumstances where such an investigation is justified, the government should take care not to assume that assets jointly owned or controlled by a husband and wife are solely the property of one spouse.” Id., at 7. 

More to the point, OGC’s analysis rested on a flawed conception of its role, as four Commissioners pointed out in a footnote:

That interest [avoiding corruption or the appearance of corruption, the only government interest strong enough to overcome First Amendment rights] is somewhat attenuated where, as here, the financial transfers occur between spouses, and especially spouses who broadly share a joint right to each other’s funds. Even if there were a generalizable corruption interest at issue, it is not obvious that highly-invasive investigations into the intimate financial arrangements of married couples is at all proportional to the government’s interest. M.L.B. v. S.L.J., 519 U.S. 102, 117 (1996) (“Choices about marriage [and] family life” are “among [those] associational rights this Court has ranked as ‘of basic importance in our society’” “sheltered by the [Constitution] against the State’s unwarranted usurpation, disregard, or disrespect”) (quoting Boddie v. Conn., 401 U.S. 371, 376 (1971)).

Id., at 3-4 n.7. 

Included in the four Commissioners in that MUR were Chair Dara Lindenbaum and Allen Dickerson, both of whom were, and are, respected practitioners, and both of whom were unfairly savaged in the Intercept‘s story. As footnote 7 (above) shows, part of that practitioners’ perspective is understanding not only the words of the law, but its underlying constitutional foundations, which oppose loose and flexible interpretations in the only Federal agency specifically empowered to restrict First Amendment rights. It is a good sign that FEC Commissioners are interested in making sure that the investigative side of the FEC is just as sensitive to the constitutional rights of those who have only been accused of wrongdoing (usually on the basis of claims reported only in the media) as a reviewing court would be. In other words, these practitioners have been on the other side of OGC investigations, and know the real value of protections against what may, in the end, turn out to be groundless accusations or errors of law. Not only is that good management practice by the Commissioners, it’s only fair (and constitutionally required). 

Now, as noted in last month’s Public Policy Advocacy Highlights, the Commissioners are being asked to consider how to prevent future disagreements with OGC before they reach the point where “j’accuse” complaints (common throughout the FEC’s history) and thoughtless media coverage might justify putting respondents to significant cost and effort. Allen Dickerson has offered a proposal for consideration by the Commissioners: 
I am proposing a directive to regularize the Commission’s approval and oversight of investigations by the Office of General Counsel (“OGC”). It would require OGC to provide the Commission with a proposed Investigation Plan for approval at the time that it circulates a First General Counsel’s Report recommending reason-to believe and an investigation. That document will lay out the proposed scope and conduct of the anticipated investigation and, upon approval, will govern the conduct of the investigation, subject to modification in light of new information or changed circumstances. 

This approach has several practical advantages. It provides a means for regular communication between OGC and commissioners concerning the conduct of a given investigation. It allows the Commission to make informed decisions about the best use of increasingly scarce enforcement resources as the volume of complaints and internally-referred matters continues to grow. It empowers OGC to take the lead in planning and executing investigations while preserving the Commission’s oversight role. And it makes the Commission itself accountable for investigations made under its authority.

It is, in other words, the sort of thing the judges on the Foreign Intelligence Surveillance Court do: review federal investigators’ plans to be sure that those investigators don’t fall victim to “Maslow’s Hammer” (“If all you have is a hammer, everything looks like a nail”). “Bottlenecks?” Yes, but in the service of preventing constitutional injuries, judged not by prosecutors but by the Commissioners in charge of avoiding exactly those injuries. Do we really want rubber stamps, or no stamps, just because someone complains, based often on mere media reports? Dickerson’s former employer, the Institute for Free Speech, filed a comment in support of the proposal.

No Improper Personal Benefit In Promoting Incumbent Senator’s Book Because The Books Would Go To Contributors and the Proceeds Were Donated To Charity: In MUR 7897 (Ted Cruz for Senate), the FEC voted that Senator Ted Cruz did not convert campaign funds to personal use because the books were distributed to donors and the proceeds were given to charity.

FEC Seeks Public Comments On Improving Filing Process and Website: The FEC is seeking comments from anybody on how it can improve its website and filing processes. “Our public reports should be easy to file and easy to access,” said Commissioner Allen J. Dickerson. “We hope commentators will give us the benefit of their experience and expertise as we work to improve these important functions.” At the Sept. 20 House Administration Committee hearing (see above), both Commissioners and Members of Congress seemed in agreement that improvements should be made, but wanted to hear from users about what those improvements should be. Deadline for comments is Nov. 13, 2023.

IRS

Alleged IRS Leaker Found, Charged: The Wall Street Journal reports (paywall) that Charles Littlejohn, 38, of Washington, D.C. was charged on September 29 with stealing the tax returns of thousands of wealthy Americans and leaking them to ProPublica, a nonprofit newsroom. ProPublica, which is nominally a 501(c)(3) organization even though its actions may violate the private benefit and illegality/public policy prohibitions in tax-exempt law, continues to publish articles targeting wealthy Americans based on the leaked information because it believes that it has the right to publish the highly-protected taxpayer information. Littlejohn was an independent contractor to the IRS from 2017 to 2021. The charging document doesn’t indicate names and locations, but the Journal used court records to track down more information. Littlejohn faces up to five years in prison.

New IRS Technical Guide 3-1 Explains 501(c)(3) Applications and Exemption Requirements, Refers to Yet-To-Be-Published TG 3-9 “For Detail:” As described below (under Congress) and in last month’s Public Policy Advocacy Highlights, various practitioners are responding to the House Ways & Means request for more IRS guidance on the prohibition against political campaign intervention by 501(c)(3) charities. Apparently, the IRS is listening, because they just published a teaser of upcoming publication of just such “detail.” But not yet.

What TE/GE has done now is release a new, broader Technical Guidance document (“TG 3-1”) giving guidance to IRS employees about the requirements for tax-exemption under IRC § 501(c)(3). TG 3-1 has a section on the political prohibition, id., at 26-27 with some bullet points which can be dropped into form letter responses or letters. For example,

(3) While some activities and disbursements are obviously political in nature, others may seem to be political but are actually educational when conducted in a non-partisan manner. Examples of this include certain voter education activities, presenting public forums, publishing voter education guides, voter registration and get-out-the-vote drives. (4) For detail see Technical Guide, TG 3-9: Disqualifying and Non-Exempt Activities, Political and Lobbying Activities IRC 501(c)(3). (TG 3-9 will be published in the future. [cite to nonexistent document])

Alex Reid on “Congress Should Expand Free Speech Rules For Tax-Exempt Groups:” In Bloomberg Tax (paywall), Alex Reid of BakerHostetler has an op-ed offering a new perspective on rules about speech by tax-exempt organizations.

Political censorship rules for nonprofits are complex, incoherent, and longstanding, due in large part to their placement in the tax law. … Congress should seize this moment to recognize the important work that charities and social welfare organizations do for the public interest and loosen the free speech restrictions on them—not impose new ones. …

Paternalists believe it’s good for charities to stay out of politics because it protects them from controversy. This argument is both wrong and disrespectful to charities because it contradicts the legislative framework, culture, and history of the nonprofit sector. 

Charities and social welfare organizations are inherently controversial. What distinguishes nonprofits from proprietary organizations is that nonprofits operate to achieve a mission rather than to distribute profits to shareholders. A mission is a theory of change about how to make the world a better place; it’s impossible to change the world without also challenging the status quo. And so political censorship of nonprofits amounts to the misguided advice of a worried parent: Change the world, but not too much, not too fast, and not too political.

CONGRESS

More on House Ways & Means Investigation of Political Activity By Tax-Exempt Organizations: The Chronicle of Philanthropy has a balanced article about (paywall) … balanced opposition (or at least concern) from both Right and Left about the Ways & Means request for information about tax-exempt organizations. The article quoted from comments by the Public Policy Legal Institute (host of this Vox PPLI blog) and by Stephanie Robbins and Beth Kingsley, lawyers from Harmon Curran, a well-known tax-exempt organization law firm.

What’s noteworthy about the backlash to the House Ways and Means committee’s efforts is that it hasn’t been restricted to the progressive groups being targeted. Conservative philanthropy leaders also recoiled in response to the inquiry. The Philanthropy Roundtable, a network of conservative donors and foundations, wrote in its reply that requiring more disclosure of donors’ identities could expose philanthropists to threats and violence and have a net result of chilling charitable giving. Elizabeth McGuigan, the Roundtable’s vice president of policy and government affairs, called voter education a vital function of the nonprofit sector and questioned whether there was systemic abuse of the system. Rather than making wholesale changes, she said, regulators should focus on catching bad actors on a case by-case basis. “We support donor privacy even for groups we don’t agree with,” she said. “Donor privacy does not depend on whether you are on the left, on the right, or in the middle.”

Other conservative groups also warned about the threat to donor privacy and raised the specter of using the IRS to police free speech and political activity. In its response, the Public Policy Legal Institute, which promotes First Amendment rights, reminded the lawmakers of the 2013 IRS “targeting scandal,” in which the agency was accused of mistreating Tea Party groups that applied for tax-exempt status. (The agency in 2017 apologized for its excessive scrutiny of conservative groups in a Justice Department settlement; a Treasury Department inspector general’s report that same year found that the agency had also been targeting groups with progressive-sounding names.) The institute argued that neither the IRS nor nonprofits are in a position to collect and analyze the activity of foreign nationals.

We should point out that we at PPLI do not consider ourselves a “conservative group,” but were too late to respond to The Chronicle’s request to “characterize” ourselves. We try to present a balanced (if grumpy) ideological viewpoint.

Committee on Education and The Workforce Reports What Everyone Has Already Heard About – “Pervasive Degradation of First Amendment Rights” in American Post-Secondary Education: The House Committee on Education and the Workforce has issued a new report on “Freedom of Speech and Its Protection on College Campuses (h/t IFS). The report describes proposed legislation and enforcement mechanisms.

The worst kept secret in American postsecondary education is the long-standing and pervasive degradation of First Amendment rights. Occurrences like shout downs, disinvitations of speakers, and “cancellations” have become commonplace at our colleges and universities, often as a result of taxpayer dollars subsidizing culturally one-sided woke faculty and administrators. This trend threatens both our constitutionally guaranteed rights and the purpose of a college education. … This report describes the modern challenges to the first amendment rights of students and faculty and offers potential solutions to secure those rights. …

The gold standard for university neutrality is found in the University of Chicago’s Kalven Report:

The university is the home and sponsor of critics; it is not itself the critic… To perform its mission in the society, a university must sustain an extraordinary environment of freedom of inquiry and maintain an independence from political fashions, passions, and pressures. A university, if it is to be true to its faith in intellectual inquiry, must embrace, be hospitable to, and encourage the widest diversity of views within its own community. It is a community but only for the limited, albeit great, purposes of teaching and research.” According to the Kalven Report, there are very few instances in which universities should take public positions. Chief among them are instances when measures threaten the university’s truth-seeking mission or its values of free inquiry. In such an instance, Universities should publicly defend their mission but should refrain from adopting institutional positions on matters of public debate.

Freedom of speech is a vital ingredient to American postsecondary education. Without it, our universities lose their purpose as truth seeking institutions and become pseudo-indoctrination camps where all truth trickles down from the top of bloated administrations. Sadly, many schools have policies and practices that unconstitutionally regulate the marketplace of ideas on their campuses.

Luckily, public policy can provide a helpful hand to university students and faculty. Twenty-three states have already enacted free speech protections and Congress should consider following their lead. Federal enforcement can secure the truth-seeking mission of postsecondary education and the expressive rights of students and faculty. This report, and the policy options it outlines, should serve as a guide to those who rightly heed Benjamin Franklin’s warning: “Whoever would overthrow the liberty of a nation must begin by subduing the freeness of speech.”

Klobuchar Attempts to Use Artificial Intelligence Hearing to Revive Dead “Honest Ads Act:” The always-perspicacious Luke Wachob from People United For Privacy noticed that Senator Amy Klobuchar tried to use a hearing on the reported dangers of AI (see above on a successful AI image creation about an FEC Commissioner) to sneak in a plug for an unrelated piece of legislation that died in 2017.

Senate Democrats had been grumbling for years about the growing use of internet ads by Americans and nonprofit causes. “Honest Ads” addressed their concerns in detail but offered nothing that would deter hostile foreign actors. Instead, the legislation proposed making it much harder for law-abiding Americans to speak about policy issues on the internet by creating a stunningly broad new category of regulated speech called a “qualified internet or digital communication.” In practice, this meant that organizations engaging in nonpartisan education and other grassroots outreach on the internet would be subjected to a range of complicated and burdensome reporting requirements. So, too, would the websites and internet platforms that host their speech.

COURTS

Is The Supreme Court Going to Disqualify Trump From the Ballot? Amidst numerous recent articles (yes) speculating about (no) whether or not former President Trump can be disqualified from the Presidency, or the 2024 Presidential election, under the 14^th Amendment, Section 3,

Meanwhile, the Campaign Legal Center and Free Speech for People filed suit under Section 3 to block Trump from the 2024 ballot. CLC’s lawyers posted an op-ed in Newsweek explaining their views. “Allowing him to remain on the primary ballot in Colorado would disenfranchise Republican and unaffiliated voters because an ineligible candidate may take votes away from the Republican candidates they support, and the Republican Party may select a candidate for president who cannot serve that role. Just like how allowing a presidential candidate on the ballot who is not 35 years old or has already served two terms as president, if the ballot includes Trump, it will prevent the election from reflecting the voters’ choice among eligible candidates.” (Despite the title, the op-ed never actually explained why they “would win;” it just listed their arguments. Maybe they thought it was obvious.)

Court Dismisses Complaint Against FEC’s Inaction Against “Shadow-Banning” and Other Social Media Company’s Censorship for Lack of Standing: Judge Royce Lamberth of the U.S. District Court for D.C. dismissed a Complaint in Freedman v. FEC for lack of standing. The Complaint alleged that Reddit, an Internet discussion board, “violated provisions of the FECA governing campaign finance disclosure, see 52 U.S.C. § 30118(a), by making prohibited and unreported in-kind corporate donations during the 2020 presidential election to unspecified federal candidates and political committees, as demonstrated by its alleged selective removal of opposing website content.” Slip op., at 2. Judge Lamberth found that the pro se Plaintiff didn’t have standing because he couldn’t demonstrate any injury from Reddit’s demotion or other actions on postings.

A plaintiff may claim that he has suffered an “informational injury” if a respondent has not complied with a rule mandating the disclosure of specified information, see FEC v. Akins, 524 U.S. 11, 21 (1998). … However, here, the Commission found that the information sought does not exist because there was no reason to believe that Reddit ever made any in-kind contributions. … Without indicia of any contributions, “there is now virtually no possibility that any decision by this Court could redress [Plaintiff’s] injury.” …

Put differently, what Plaintiff is really seeking is a legal determination by the Commission that Reddit contributed money to particular political campaigns, and that both the contributions themselves, and Reddit’s alleged failure to report them, are violations of the FECA. … At root, Plaintiff asks the Commission to find, based on his conjecture alone, that Reddit broke the law. See id. “As this Circuit so aptly put it in Common Cause, what plaintiff desires is for the Commission to get the bad guys, rather than disclose information.” Jud. Watch, Inc. v. Fed. Elec. Com’n, 293 F. Supp. 2d 41, 46–47 (D.D.C. 2003) (quoting Common Cause, 108 F.3d at 418) (internal quotation marks omitted). Because Plaintiff “does not have a justiciable interest in the enforcement of the law[,]” his alleged informational injury “is not cognizable injury under FECA,” sufficient to satisfy the standing requirement.

STATES

Indiana Supreme Court Upholds Ban on Corporate Contributions to PACs, Which Will Likely, In the Long-Run, Result In Striking Down the Ban: Jim Bopp, a long-time participant in the First Tuesday Lunch Group, often plays a sophisticated “long game” in litigation. This week, he won a case arguing that Indiana law permits a State to ban corporate contributions to a Political Action Committee. That might come as a surprise to those who remember that Bopp was the lawyer who successfully argued Citizens United, which opened the door to later cases upholding corporate contributions to SuperPACs. But it was apparently part of a multi-step strategy to undercut the ban.

On September 25, the Indiana Supreme Court ruled 4-1 that State law bans corporate contributions to PACs. That would violate the constitutional interpretation in Citizens United. “The case was first filed in federal court, but that system said it couldn’t offer a decision until a state court established the law’s meaning. The Seventh Circuit eventually passed the case on to the Hoosier system. Bopp’s expected to take the ruling back to the federal court system to argue that the law is unconstitutional — which Molter anticipated in his opinion. But he said fixes fall to lawmakers, not the court.”

Fourth Circuit Considers First Amendment Challenge to Maryland’s New Digital Advertising Gross Revenues Tax: Danger lurks in listening to legislative advice from professors, or so argues the U.S. Chamber of Commerce in its challenge to Maryland’s new tax on large tech firms that host digital advertising, Chamber of Commerce v. Lierman, No. 22-2275, (4^th Cir., argued September 20, 2023). According to the plaintiffs, the case began when NYU Economics Professor (and recipient of the 2018 Nobel Prize in Economics) Paul Romer published a New York Times op-ed “accusing Google, Facebook, and other “dominant social media platforms” of “mak[ing] their profits using business models that erode” the “shared values and norms on which democracy depends.” Prof. Romer urged States to impose a “surcharge” or “penalty” on digital advertising. Id.

Maryland officials, eager for cash, saw an opportunity and slapped such a tax onto the usual big suspect companies. The graduated tax began at 2.5% on digital advertising receipts for companies with $100 million in “global annual revenues” and rising to 10% for companies with annual revenues of $15 billion or more. Potentially quite a lot of money. The Maryland Senate President Bill Ferguson testified later that the bill was “based off a model originally built by Paul Romer.”

A Maryland court found the law violated, among other things, the First Amendment by discriminating on the basis of content. The State appealed, and the Maryland Supreme Court reversed on May 29. Maryland collected $128 million in 2022-23. Nevertheless, Lydia Kay Griggsby, U.S. District Judge in Maryland, dismissed the Chamber’s challenge to the new Maryland tax as moot, based on the Maryland court’s finding.

The Chamber and its other tax-exempt organization plaintiffs were not satisfied with the limited federal ruling, so they appealed the mootness decision to the U.S. Court of Appeals for the Fourth Circuit, claiming that Griggsby had jurisdiction under a variety of theories, including the First Amendment. “By setting such high thresholds for liability, and by excluding broadcast entities and news media firms, the Act’s architects precisely targeted ‘massive technology companies’—those with global footprints and predominantly internet-based business models—to pay the assessment.” A Fourth Circuit panel heard oral arguments on September 20.

Michigan Secretary of State Says It’s Not Up to State Secretaries To Decide Whether Trump Is On 2024 Ballot: With many claiming that States have the authority under the Fourteenth Amendment, Section 3, to decide the qualifications and appearance of Presidential candidates on their State’s ballots, their Secretaries of State are in the eye of the current debate. Jocelyn Benson, a former law school dean and professor of campaign finance and election law, is now Michigan’s Secretary of State, responsible for running that State’s elections. Her answer? In a Washington Post op-ed, she writes: Don’t ask us, ask the Supreme Court. “This responsibility includes ensuring that the decisions we make are nonpartisan, follow the law, uphold the Constitution and protect democracy. The arguments in support of the legal theory that Trump, as the central figure in an alleged conspiracy to overturn the legitimate election results of 2020 and the subsequent riot at the U.S. Capitol, is disqualified from future service are compelling. But significant counterarguments, along with practical considerations, make this theory far from a slam dunk.”

GENERAL

Perennial Gadfly Lessig Opines Against SuperPACs: Harvard Law Prof. Larry Lessig has often argued against “money in politics;” he has a new op-ed in Newsweek called “We Can End the Corruption of Super PACs.” His theory is that the U.S. Court of Appeals for the D.C. Circuit (which by statute handles most cases involving the Federal Election Campaign Act) was wrong when it found in 2010 that there would be no “quid pro quo” corruption from independent spending by SuperPACs. His proof: seven years after that 2010 decision in SpeechNow v. FEC (also known as David Keating v. FEC after its more famous plaintiff), the U.S. Department of Justice charged Senator Robert Menendez with corruption over an independent expenditure by a SuperPAC. But … Lessig doesn’t mention that Menendez’s trial ended in a widely-publicized mistrial. He was investigated again in 2022 (CNN has more details about the corruption that was charged) and charged again in 2023 this time for supposed shenanigans with exports to Egypt. Politico notes in a deep dive that these charges come up about every ten years with Menendez, and he has vowed not to resign this time either, even though this time the feds have pictures of gold and cash apparently in the Senator’s jacket pockets.  

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