On September 18, the U.S. Court of Appeals, D.C. Circuit, held unconstitutional several Federal Election Commission regulations on campaign spending by non-profit groups, often known as “527’s”. The case is Emily’s List v FEC, 08-5422. Here is the decision. The majority decision is 44 pages, and the partial dissent/partial concurrence is 29 pages.
The FEC regulations held that non-profit groups that run their own ads campaigning for or against candidates for federal office are limited, in how they raise the money to pay for those ads. The FEC said individual contributions to such non-profit groups could not exceed $5,000. Two judges in the 3-judge panel said such contribution limits are unconstitutional. The third judge said that the Court should not have reached the constitutional issue, but should have limited its holding to finding that the FEC lacked authority to issue the regulations.
A paradox of the decision is that now (assuming the decision stands), non-profits have more ability to raise money to run their own political ads referring to candidates for federal office than political parties do. When political parties raise money, contributions from individuals are limited.
Of course, under the decision, non-profits are still limited in how much money individuals may contribute, if the non-profit then uses those contributions to contribute directly to particular candidates. The decision does not deal with contributions from non-profits to candidates. It only deals with contributions to non-profits when the non-profit uses its money to produce and run its own ads.
This decision, if it stands, should be very helpful to Unity08 in its pending lawsuit against FEC regulations that limited contributions to it. Thanks to Howard Bashman’s HowAppealing for the link.