Bread Political Action Committee v. The Federal Election Commission

635 F.2d 621, 1980 U.S. App. LEXIS 11682
CourtCourt of Appeals for the Seventh Circuit
DecidedDecember 5, 1980
Docket80-1146
StatusPublished
Cited by14 cases

This text of 635 F.2d 621 (Bread Political Action Committee v. The Federal Election Commission) is published on Counsel Stack Legal Research, covering Court of Appeals for the Seventh Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Bread Political Action Committee v. The Federal Election Commission, 635 F.2d 621, 1980 U.S. App. LEXIS 11682 (7th Cir. 1980).

Opinions

CUMMINGS, Circuit Judge.

In this action, we are presented with four questions concerning the constitutionality of 2 U.S.C. § 441b(b)(4)(D), a provision of the Federal Election Campaign Act (“Act”) (2 U.S.C. §§ 431 et seq.).1 The questions come to us on certification from the district court pursuant to 2 U.S.C. § 437h.

j Introduction

In March 1977, plaintiffs brought this suit under 2 U.S.C. § 437h 2 seeking a declaration that Section 441b(b)(4)(D) is unconstitutional and asking the district court to grant a permanent injunction against enforcement thereof. Plaintiffs are the National Restaurant Association and the National Lumber and Building Material Dealers Association, both incorporated trade associations, and the Bread Political Action Committee, the Restaurateurs Politicál Action Committee and the Lumber Dealers Political Action Committee. The three plaintiff political action committees were organized respectively by the American Bakers Association, the National Restaurant Association and the National Lumber and Building Material Dealers as separate segregated political action funds and were registered with the Federal Election Commission pursuant to 2 U.S.C. § 433. Plaintiffs named as defendants the Federal Election Commission (“Commission”), its eight members and, because he is empowered to take appropriate action on the Commission’s referrals of apparent statutory violations, the Attorney General of the United States (Plaintiffs’ App. 17).

The challenged provision is one of the 1976 permissive exceptions to Section 441b(a) of the Act, which prohibits contributions or expenditures by “any corporation [624]*624whatever” or “any labor organization” in connection with a federal election. But an exclusion, added by the amendment to the Act in 1972 and now contained in Section 441b(b)(2)(C), allows corporations and labor organizations to use general treasury funds for “the establishment, administration, and solicitation of contributions to a separate segregated fund 3 to be utilized for political purposes” by the parent organization. These segregated funds may be used to make contributions to candidates in federal elections subject only to restrictions imposed elsewhere in the Act and not in issue here.

A segregated political fund and its parent organization are restricted, however, as to whom they may solicit for fund contributions. Section 441b(b)(4)(A)(i) makes it unlawful for a corporation or its segregated political fund to solicit contributions from anyone other than its stockholders and their families or its executive or administrative personnel and their families, while Section 441b(b)(4)(A)(ii) makes it unlawful for a labor organization or its segregated political fund to solicit contributions from any person other than its members and their families. These prohibitions are in turn subject to three exceptions added in 1976. Paragraph (B) of Section 441b(b)(4) permits corporations to make two annual written solicitations of their rank-and-file employees and their families. See 11 C.F.R. § 111.6(a). Paragraph (B) also permits labor organizations representing corporate unit employees to make two annual written solicitations of the corporate shareholders and all corporate employees, whether members of the union or not. See 11 C.F.R. § 114.6(b). Paragraph (C) permits membership organizations, cooperatives and corporations without capital stock or their segregated political funds to solicit contributions from their members.

The last exception, paragraph (D) of Section 441b(b)(4), is the focus of the present litigation. This provision permits a trade association or its segregated political fund to solicit contributions from the stockholders and executive and administrative personnel of its member corporations and their families provided that such solicitation has been approved by the member corporation and the member corporation has not approved a solicitation by any other trade association for the same calendar year. The full text of Section 441b(b)(4)(D) is as follows:

“This paragraph [Paragraph (A) of Section 441b(b)(4)] shall not prevent a trade association or a separate segregated fund established by a trade association from soliciting contributions from the stockholders and executive or administrative personnel of the member corporations of such trade association and the families of such stockholders or personnel to the extent that such solicitation of such stockholders and personnel, and their families, has been separately and specifically approved by the member corporation involved, and such member corporation does not approve any such solicitation by more than one such trade association in any calendar year.”

All of Section 441b is set out in the Appendix hereto.

In September 1977, pursuant to 2 U.S.C. § 437h, plaintiffs filed a motion below for immediate district court certification to us of certain questions they had submitted to that court pertaining to the constitutionality of the foregoing provision. This motion was denied two days thereafter, and on October 7 the district court denied plaintiffs’ motion for a preliminary injunction. We granted leave to appeal on December 21, 1977. On appeal, the principal question [625]*625before us was whether the five plaintiffs had standing to invoke 2 U.S.C. § 437h (set out in note 2 supra).

On January 12, 1979, this Court decided that plaintiffs do have standing to invoke Section 437h and thus have all their constitutional challenges certified by the district court for initial review by this Court sitting en banc. Bread Political Action Committee v. Federal Election Commission, 7 Cir., 591 F.2d 29. Therefore, the cause was remanded to the district court, which at plaintiffs’ request subsequently certified the following four questions4 to us:

“1. Whether 2 U.S.C. § 441b(b)(4)(D), ' both facially and as applied, infringes plaintiffs’ right of assembly guaranteed by the First Amendment to the Constitution of the United States of America?
“2. Whether 2 U.S.C. § 441b(b)(4)(D), both facially and as applied, deprives plaintiffs of liberty without due process of law in violation of the Fifth Amendment of the Constitution of the United States?
“3. Whether the failure of the Federal Election Campaign Act, as amended, 2 U.S.C.

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Bluebook (online)
635 F.2d 621, 1980 U.S. App. LEXIS 11682, Counsel Stack Legal Research, https://law.counselstack.com/opinion/bread-political-action-committee-v-the-federal-election-commission-ca7-1980.