Van Hollen, Jr. v. Federal Election Commission

United States Court of Appeals for the District of Columbia Circuit · 2016 · Administrative Law

Administrative LawChevron deferenceArbitrary and capricious reviewCampaign finance disclosureFECBCRAelectioneering communicationsdisclosure

Facts

BCRA requires a person making more than $10,000 in electioneering communication disbursements to disclose the names and addresses of all contributors who gave $1,000 or more to the person making the disbursement. After Wisconsin Right to Life allowed corporations and unions to fund certain electioneering communications, the FEC revisited its disclosure rules and adopted a rule requiring corporations and labor organizations to disclose only donations of $1,000 or more made for the purpose of furthering electioneering communications. Van Hollen argued BCRA required disclosure of all such donations regardless of purpose. The FEC justified its rule based on concerns about accurately identifying actual supporters of the communication, reducing compliance burdens, and protecting donor privacy.

Issue

Whether the FEC's rule limiting disclosure to donations made for the purpose of furthering electioneering communications is a permissible construction of BCRA under Chevron Step Two and whether the rule is arbitrary or capricious under State Farm.

Rule

Where a statute is ambiguous and Congress has left a gap for the agency to fill, a court must uphold the agency's interpretation at Chevron Step Two if it is reasonable in light of the statute's text, history, and purposes; the court need not find it the best interpretation. Under State Farm, an agency rule survives arbitrary and capricious review if the agency's path can reasonably be discerned and the rule reflects reasoned decisionmaking, even if the explanation is not ideally clear.

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Congress enacts a federal disclosure law requiring any organization that spends more than $20,000 on certain preelection broadcasts to report the names of all "contributors" of $2,000 or more. After a Supreme Court decision newly permits trade associations to make those broadcasts, the Federal Civic Oversight Board adopts a rule requiring disclosure only of donors who gave for the purpose of supporting those broadcasts. A watchdog group sues in Washington, D.C.

If a court has already held that the term "contributors" is ambiguous and can linguistically bear a purpose limitation, how should the court evaluate the rule at Chevron Step Two?

Explanation. At Chevron Step Two, the question is whether the agency adopted a reasonable interpretation, not the best one. The majority held that once the statute was ambiguous and the agency's reading fell within the range of linguistically permissible constructions, the court had to defer if the interpretation was reasonable in light of text, history, and purposes. The court rejected the idea that maximal disclosure is always required.