ATTORNEYS AT LAWFOLEY & LARDNER LLP
3000 K STREET, N.W., SUITE 500
WASHINGTON, D.C. 20007-5143
WRITER'S DIRECT LINE
August 26, 2008
Mr. John C. Keeney, Esq.
Deputy Assistant Attorney General
U.S. Department of Justice
Washington, D.C. 20350
Re: Response to Letter to DOJ from Obama for America
Dear Mr. Keeney:
The undersigned serves as counsel to American Issues Project, Inc., a non-profit organization recognized as tax exempt under §501(c)(4) of the Internal Revenue Code ("AIP"). I am in receipt of an August 21, 2008 letter released to the media which was apparently sent to you from the general counsel to Obama for America campaign, Mr. Robert F. Bauer ("Obama Letter"). This is in response to the Obama Letter (which I have not received directly, but is has been furnished to me by representatives of the news media).
Let me be very clear: AIP is not in violation of any federal statute, regulation or other applicable law. This organization, its officers and directors and all those associated with it have taken great pains to comply with all provisions of law applicable to AIP's activities and programs and will continue to do so at all times in the future.
AIP is organized as a qualified nonprofit corporation as that term is defined in the regulations of the Federal Election Commission ("FEC") 11 C.F.R. §114.10. As such, AIP enjoys the protections of the provisions of the Supreme Court's decision more than twenty years ago in FEC v. Massachusetts Citizens for Life, Inc., 589 F. Supp. 646 (D. Mass. 1984), aff'd, 769 F.2d 13 (1st Cir. 1985), aff'd, 479 U.S. 238 (1986). The Supreme Court delineated the type of corporation which would be permitted to make independent expenditures under this ruling. "MCFL has three features essential to our holding that it may not constitutionally be bound by §441b's restriction on independent spending." These three criteria are as follows:
- The organization must be formed "for the express purpose of promoting political ideas, and cannot engage in business activities. If political fundraising events are expressly denominated as requests for contributions that will be used for political purposes, including direct expenditures, these events cannot be considered business activities."
- The organization must have "no shareholders or other persons affiliated so as to have a claim on its assets or earnings."
- The organization must not have been established by a business corporation or a labor union, and must adopt a policy "not to accept contributions from such entities."
Website of the Federal Election Commission: http://www.fec.gov/law/litigation
AIP complies with each and every one of the provisions outlined by the Supreme Court in the MCFL case, as well as the regulations of the FEC promulgated subsequently.
Further, the majority of AIP's annual expenditures are not political expenditures but are devoted to grassroots lobbying and education on issues, public policies and other communications, activities and programs appropriate to a 501(c)(4) social welfare organization in accordance with all applicable provisions of the Internal Revenue Code.
With respect to the Obama Letter and its assertions related to the language on the AIP website requesting the occupation and employer information of donors to AIP, your department is no doubt aware that if/when AIP makes expenditures for communications or activities that are subject to disclosure to the Federal Election Commission, each of those require the disclosure of the employer/occupation of donors whose contributions are used for those activities and/or communications.
An independent expenditure as that term is defined by the FEC regulations (11 C.F.R. §§100.16, 100.22) requires disclosure of the expenditure to the FEC within certain time periods established by law on the FEC Form 5 (see 11 C.F.R. 109.10). The FEC Form 5 requires disclosure of the occupation and employer of any person who contributes to the independent expenditure. A copy of the FEC instructions and Form 5 are available on the FEC's website: www.fec.gov AIP filed its Form 5 on Tuesday, August 19, 2009 disclosing the required information, including the occupation and employer of the donor who contributed to the current AIP advertising.
Likewise, should AIP engage in 'electioneering communications' as that term is defined by 11 C.F.R. §100.29, AIP must file an FEC Form 9 within 24 hours of the communication. Again, the FEC form 9 requires disclosure of the employer/occupation information of any individual donor to the electioneering communication who is otherwise subject to public disclosure. See 11 C.F.R. §104.20. A copy of the FEC instructions and Form 9 are also available on the FEC website: www.fec.gov
A qualified nonprofit corporation such as AIP is not relieved of the obligation to obtain and disclose employer/occupation information for donors whose funds are used in independent expenditures or electioneering communications as those terms are defined by law. The request by AIP appearing on its website for such donor information is for the sole purpose of satisfying AIP's reporting responsibilities under the referenced regulations of the FEC.
Counsel for the Obama Campaign is undoubtedly fully knowledgeable of the reporting and compliance responsibilities of qualified nonprofit corporations, such as NARAL-Pro Choice America ("NARAL"), an organization that, ironically, also claims protection as an entity described in Massachusetts Citizens for Life v. FEC.
NARAL describes one of its primary program areas as the "politics, campaign and strategy program work(ing) to ensure the election of pro-choice candidates on the federal level. Using polling, voter identification, persuasion, and get-out-the-vote techniques, we work with campaigns, candidates, and our affiliates to identify, persuade and turn out prochoice voters in elections throughout the nation". NARAL reported spending more than $3 million on political activities related to federal elections in 2006, more than any other of its program areas, but presumably not a majority of its expenditures. See NARAL-PRO CHOICE AMERICA 2006 Form 990 tax return. Accessed on August 26, 2008, www.guidestar.org
AIP functions in exactly the same manner as NARAL and any other qualified nonprofit corporation. NARAL has made substantial independent expenditures in opposition to Sen. McCain's presidential candidacy during the 2008 election cycle and continuing through the present time. Yet, no objection to those expenditures has been raised by the Obama campaign. See www.fec.gov, Reports of independent expenditures by spender.
The accusations in the Obama Letter against AIP are wholly inaccurate. AIP has made and continues to make every effort to fully comply with all the laws and regulations governing its efforts to engage in protected First Amendment political speech and activities.
Finally, Sen. Obama's presidential campaign has now purchased paid television advertising directly related to the AIP advertising. Surely, the citizens of America are not in a situation in 2008 where a candidate for President of the United States is permitted to purchase paid advertising on a topic about which a citizens organization, following all applicable laws and regulations, is not allowed to sponsor advertising or if they do will find themselves subject to prosecution by your department.
Surely we have not come to a point where the government and its agencies are used to protect presidential candidates from citizens' speech, essentially destroying the very purpose, meaning and historical essence of the First Amendment to the United States Constitution.
Please contact me if you have further questions.
Cleta Mitchell, Esq.
Counsel, American Issues Project, Inc.