Lawsuit Challenges Reporting Requirements for Conduit PACs
A new lawsuit is challenging the requirement that conduit PACs disclose the personal details of small-dollar donors in their filings with the Federal Election Commission.
The complaint, filed in the Northern District of Texas’ Fort Worth Division, argues that the provision in the Federal Election Campaign Act requiring conduit PACs, like ActBlue and WinRed, to publicly identify donors to give less than $200 to a campaign or committee violates a right to anonymity guaranteed by the First Amendment of the Constitution.
“Many Americans like to keep their giving private,” the complaint argues. “Some donors have complex motives and interests that they do not want to explain to others. Others seek anonymity out of modesty, or due to religious beliefs. And many donors fear repercussions if the causes they support become known.”
A spokesperson for the FEC declined to comment on the lawsuit.
The complaint was filed by Tony McDonald, an attorney who also serves as general counsel for the Tarrant County Republican Party. The complaint is being brought by McDonald in his personal capacity.
According to the complaint, because McDonald “is actively involved in partisan politics” he “sometimes wants his personal support to be kept private. Thus, McDonald occasionally limits his donations to $200 or less, the threshold over which direct donations to candidates are publicly disclosed.”
“But even though McDonald is a sophisticated political insider, some arcane aspects of federal campaign finance laws were unknown even to him,” the complaint reads. “To his surprise, a donation he made was disclosed to the FEC, and in turn the public, simply because the candidate received McDonald’s donation through a conduit platform.”
A Long-Running Complaint
The lawsuit, which mirrors a similar complaint filed last year in Ohio, gets at an issue that campaign finance experts and compliance professionals on both sides of the aisle have long complained about.
Campaigns aren’t required to disclose the personal information of their donors who give less than $200. But conduit PACs, like ActBlue and WinRed – the main clearinghouses for small-dollar contributions to Democratic and Republican campaigns, respectively – are required to disclose the personal information, including names and street addresses, of donors who give even $1.
WinRed has already asked the FEC to allow it to stop itemizing small donations – a process that many political lawyers argue is unnecessarily onerous and does little to crack down on corruption or fraud.
Dan Backer, a veteran political attorney for Republicans argued that the larger regulatory framework established by FECA should be adjusted to raise the threshold at which campaigns and committees have to report the personal information of their donors. Doing so, he acknowledged, would require an act of Congress.
As for McDonald’s lawsuit, Backer said, there may be reason for the court to grant the request to amend the reporting requirements for small-dollar donations made through conduit PACs.
“There is a good argument to grant this – the law is uninterested in the sub $200 donation from individuals, OR $100,000 from one individual to many candidates all of whom individually get sub $200 total amounts,” Backer wrote in an email.
“Why does their choice to associate through a conduit PAC solely for the purpose of facilitating a contribution they could have made directly if that had been the solicitation they received, change that?” he asked. “There isn’t any basis for it.”
