“Judge Grants Partial Motion for Summary Judgment in Shays II Case”

So explains the Campaign Legal Center:

    On March 29, 2006, a U.S. District Court Judge issued a 34 page opinion granting in part plaintiffs’ motion for summary judgment in Shays and Meehan v. FEC (D.D.C.). This case was brought in 2004 challenging the FEC’s failure to regulate 527 groups. The found that the FEC had “failed to present a reasoned explanation for its decision that 527 organizations will be more effectively regulated through case-by-case adjudication rather than general rule.” The court also said, “Indeed, judging from the FEC’s track record in the 2004 election, case-by-case adjudication appears to have been a total failure.” The court remanded the case to give the FEC another opportunity to either issue a rule governing 527 organizations or to provide adequate justification and explanation for its failure to issue a rule.

The opinion is here.
It is not clear to me how significant this is. I believe the FEC is already working on 527 rules. [SEE UPDATE BELOW.] And the court did not require the the FEC actually promulgate such rules:

    Plaintiffs seek an order directing the FEC to promulgate a rule defining the term “political committee” and when a 527 group must register as a political committee. This remedy, however, is reserved for “only the rarest and most compelling of circumstances.” See American Horse Protection Association v. Lyng, 812 F.2d 1, 7 (D.C. Cir. 1987) (quoting WWHT, 656 F.2d at 818). Such circumstances are not present here. Rather, the more appropriate remedy is to remand the case to the agency to explain its decision or institute a new rulemaking. Id.

See also this report in the NY Sun, and these thoughts from Bob Bauer.
UPDATE: A few readers (who have much greater knowledge of the day-to-day business of the FEC than I do) wrote to ask about my statement above that I believe the FEC is working on 527 rules. My memory on this point was faulty. Here is the FEC rulemaking page, and there is not any rulemaking listed there for when 527s should be considered as political committees. I had seemed to recall that when the FEC failed to enact rules for 527s in the summer of 2004, it put this on the agenda to consider after the 2004 elections. But that appears to be wrong.

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