Breaking News: 4th Circuit Upholds FEC’s “Major Purpose” Test for Political Committees, Subjecting Groups Like Crossroads GPS to Potential Liability for Not Registering as Super PACs

Today the United States Court of Appeals for the Fourth Circuit upheld two disclosure-related FEC rules.  This was the latest opinion in the long-running case, Real Truth About Obama, Inc. v. FEC.

Among other things, the Court upheld the FEC’s case-by-case approach to determine which political groups need to register as political action committees (and as a consequence must reveal all of their donors).  The FEC uses a fact-intensive multi-part inquiry to determine whether a particular group has as its “major purpose” the nomination or election of federal candidates for office.

Karl Rove’s American Crossroads is a (super) PAC registered with the FEC which reveals all of its donors.  Its sibling organization, Crossroads GPS (a 501c4), claims it is not a political committee and need not register with the FEC.  With this 4th Circuit opinion, I now expect campaign reform groups and/or Democrats to file complaints against Crossroads GPS, claiming its major purpose is to elect Republican candidates to federal office and that it is violating the law by not registering as a political committee.  The fact that groups like GPS will now need to make independent expenditures to avoid disclosing its contributors to fund “electioneering communications” under the new van Hollen case will make it more likely the FEC will treat GPS as a political committee subject to disclosure requirements.

Of course, given how the FEC is divided on partisan lines today, it could well be that the FEC will divide on whether a group like GPS has electioneering as its major purpose, and the issue could end up in the courts.

This case also marks another loss for Jim Bopp in his many post-Citizens United challenges to disclosure requirements. By my count, he has lost all of the major disclosure cases he has brought since Citizens United. The courts, especially since Citizens United blew away campaign finance limits, seem much more apt to uphold broad disclosure rules.

More on the case from the Campaign Legal Center, which has taken a major role in this long-running case.


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