NATIONAL LEGAL AND POLICY CENTER
"Promoting Ethics in Government"
1309 Vicent Place, Suite 1000
McLean, Virginia 22101
703-847-3088, Fax 703-847-6969
www.nlpc.org, nlpc@nlpc.org


 
BEFORE THE FEDERAL ELECTION COMMISSION
OF THE
UNITED STATES OF AMERICA
 
April 10, 2000
In Re:

Grassroots.com, Inc., League of Women Voters of the
United States, League of Women Voters Education Fund,
Democracy Network and Center for Governmental Studies

     Respondents
_________________________________________
 
COMPLAINT

NATIONAL LEGAL AND POLICY CENTER, a corporation organized and existing under the District of Columbia Non-profit Corporation Act and having its offices and principal place of business at 1309 Vincent Place, Suite 1000, McLean, Virginia, 22101, ("Complainant") files this Complaint with the Federal Election Commission in accordance with the provisions of  2 U.S.C. § 437g(a)(1).  Upon information and belief, Complainant submits this Complaint for the reason that Respondents are in violation of the provisions of the Federal Election Campaign Act of 1971, as amended, 2 U.S.C. §§ 431, et seq. ("the Act") ("Complaint").  Complainant hereby submits the verified facts demonstrating that Grassroots.com, Inc., ("Grassroots.com"), League of Women Voters Education Fund ("LWVEF") and League of Women Voters of the United States ("LWV")(collectively "League"), Democracy Network ("DNet"), and Center for Governmental Studies ("CGS") (collectively hereafter "Respondents") have violated and continue to be in violation of the provisions of the the Act.

For the reasons stated, the undersigned hereby requests that the Federal Election Commission ("FEC" or "Commission") conduct an investigation and determine that an ongoing violation of the Act is occurring and is being committed by the Respondents and further request the Commission pursue enforcement of civil and injunctive relief against the Respondents.
 

Complainant

The National Legal and Policy Center is a charitable and educational organization described in section 501(c)(3) of the Internal Revenue Code, whose purpose is to foster and promote ethics in government.  In furtherance of that purpose, National Legal and Policy Center endeavors to assure compliance with the provisions of the Code of Ethics for Government Service and the laws of the United States.

 
Summary of Complaint

Respondents, each of them, are corporate entities.  The Act prohibits any corporation from making any "contribution or expenditure" in connection with a Federal election. The term "contribution or expenditure" is defined to include "any direct or indirect payment, distribution, loan, advance, deposit, or gift of money, or any services, or anything of value . . . to any candidate, political party or committee, organization, or any other person" in connection with any Federal election. The phrase "anything of value" includes goods or services provided without charge or at less than the usual and normal charge.

Respondents are providing to federal candidates free of charge a number of highly valuable commercial goods and services via Respondents' web site(s), located at http://www.grassroots.com ("web site") including, among others, content space on Respondents' web site(s), email communication link, candidate advertising, campaign fundraising solicitation services, and volunteer solicitation services (Exhibit A, email letter from DNet / League to federal candidate (1)).

The above-referenced products and services comprise the Content of Respondents' web site.  Respondents have established a monetary value of at least $30 million for the Content by virtue of the financial investments such Content has attracted for the company, whose only product is the web site.  Content of the web site is disseminated to the general public. (Exhibit B, "About Grasssroots.com", from Respondents' website; Exhibit C, Fact Sheet, from web site, and Exhibit D, Fact Sheet, disseminated by Respondents).

Content is obtained from federal candidates in a highly interactive manner, as opposed to the "passive" manner described to the Commission by Respondents (See Exhibits A; Exhibit E, Advisory Opinion Request submitted by Respondents DNet, League and CGS(2)).  The interaction displayed in Exhibit A exceeds the allowable interaction for development of voter guides.  See 11 § C.F.R.114.4 (5)(ii)(A).  Respondent League acts as the initial contacting entity which solicits federal candidates participation in the web site.  League's communications with federal candidates describe the site as one which offers "free advertising", "free web space", "free email" as well as contribution and volunteer solicitations. (Exhibit  A).  League relies on its noncommercial and nonprofit image as a means of luring federal candidates to participate in Respondents' web site.  In reality, League, DNet and CGS are all being compensated financially for their activities in obtaining content from federal candidates for Respondent Grassroots.com's web site.  Indeed, from Respondents' public statements, it appears that funding from Grassroots.com actually supports and finances the League's costs in obtaining and developing Content from federal candidates which, in turn, is provided to and through Grassroots.com and is the source of value to Grassroots.com, a commerical enterprise.

Respondents League, DNet and CGS previously represented to the Commission that the entire enterprise was / is noncommercial, which is clearly not the case.  (Exhibit E, AOR, September 1, 1999, pp. 6-7; "DNet creates a noncommercial forum people can engage in politics in ways that will help them become more effective, participatory citizens.")  Then, on February 23, 2000, League Executive Director Jane Gruenebaum stated, "We really couldnítt have the reach we wanted or the depth we wanted. . .without a commercial partner."  (Exhibit F, "For-Profit Political-Portal Deal Raises Image Issue for League", Wall Street Journal Interactive, February 23, 2000).
 
Curiously, the League has taken a strong public position in opposition to corporate contributions to federal candidates and political parties.  (Exhibit G, "League of Women Voters:  Advocates of Public Discourse or Public Debt", by Jared B. Adams, published by Capital Research Center in Organization Trends, March 2000).  Notwithstanding its policy position opposing  soft money (unregulated corporate contributions to or expenditures on behalf of federal candidates), the League in combination with other Respondents (all of which are corporate entities) are providing corporate services free of charge directly to federal candidates and, in turn, receiving substantial cash contributions from Respondent Grassroots.com as payment for delivering DNet to Grassroots.com.  In addition, it should be noted that DNet was originally created and built with tax-deductible contributions from foundations and other charitable donors.

Finally, Respondents either deliberately misled the Commission regarding the factual basis of its operating procedures contained in and presented to the Commission in their Advisory Opinion Request or the facts presented have substantially changed since the opinion was issued by the Commission. In either event, based on the actual and currently existing facts, Respondents should not be allowed to rely on said opinion as a means of avoiding compliance with the law.  Further, Advisory Opinion 1999-25 has been rendered null and void by Respondents subsequent actions and should no longer be considered operative by the Commission or the regulated community.

In summary, Respondents' web site and the content thereof is a commercial venture providing highly valuable goods and services without charge to federal candidates in violation of the prohibitions of 2 U.S.C. A. § 441b and 11 C.F.R. § 114.1(a)(1) and 114.2(a).
 

A. STATUS OF NAMED RESPONDENTS

1. Grassroots.com.  Grassroots.com describes itself as a "media and technologies company".  (See Exhibit B, C adn D).  It is a privately held, commercial corporation, incorporated in the State of Delaware on October 21, 1999. (Exhibit H, Public Records Filings, State of California.)  Its principal office is located in San Bruno, California. A thorough description of Grassroots.com can be found at its website located at http:\\www.grassroots.com.  (See Exhibit B, C and D).  The Grassroots.com website is fully incorporated herein by reference.

 2. League of Women Voters Education Fund and League of Women Voters of the United States.  Both the League of Women Voters of the United States and the League of Women Voters Education Fund are non-profit corporations.  (See Exhibit E)  The League of Women Voters Education Fund is corporation exempt from taxation pursuant to IRC § 501(c)(3).  (See Exhibit I, Press Release, February 15, 2000; Exhibit J, Joint Press Release, March 15, 2000).  The League of Women Voters of the United States is a separate, non-profit corporate entity also exempt from taxation under IRC § 501(c) which engages in lobbying activities on a range of public policy issues on which it has taken a specific position and which it specifically advocates, including issues related to the financing of federal campaigns.

3. Democracy Network ("DNet").   DNet is represented to the public as a joint project of the League of Women Voters Education Fund and the Center for Governmental Studies. It has been acquired by Grassroots.com for "unrestricted cash contributions" in an undisclosed amount.  (See Exhibit J)  DNet was created and built by League and CGS with funding from and contributions to the Respondents' 501(c)(3) charitable corporations.  (See Exhibit K, listing of charitable foundations and donors who paid for the establishment of DNet).  DNet specifically states that it provides information from and about federal candidates to the general public and not any restricted class.  "DNet brings candidates, ballot measure committees and voters together in an on-line electronic mall, where users can review candidate views, ask questions and ultimately cast more informed ballots."  (See Exhibit L, DNet WEBSITE: "ABOUT DNET-OUR PURPOSE" 03/27/00).

 4. Center for Governmental Studies. CGS is a non-profit corporation, which describes itself as a 501(c)(3) non-partisan think tank located in Los Angeles, CA.  It states that its areas of interest involve campaign finance and ballot initiative reform, electoral and government reform through the use of communication technology, campaign and government ethics, higher education reform and state and local budget reform (see attached Exhibit M).
 

B. FACTUAL BACKGROUND OF THE COMPLAINT

1. Respondent League's collection from and posting of information from federal candidates on behalf of Grassroots.com (Content) is a thing of value to federal candidates, as evidenced by the value placed on Content by Respondents themselves.

Grassroots.com's only product is its web site and the Content of that web site. Grassroots.com acquired DNet specifically for purposes of having a guaranteed source of Content for its own web site. The Content of a web site clearly has substantial monetary value.

According to Grassroots.com's public statements on February 15, 2000
 

The financing included investments by Knight Ridder Ventures, the venture capital affiliate of Knight Ridder Corporation, among other investors.  Tony Ridder, Chairman and CEO of Knight Ridder, was named to Grassroots.com's Board of Directors (See Exhibit P).  The League and CGS were both provided cash "contributions" in an undisclosed amount as part of the transaction(s).  (See Exhibit F & I).

Grassroots.com has publicly described its partnership with the League to "collect candidate statements and information, and promote the use of Grassroots.com in elections and by interested political groups. . ."  See Exhibit J.  In other words, Grassroots.com, a clearly commercial venture, will not contact federal candidates directly, but will post Content acquired by the League, which is solicited and otherwise obtained by the League from federal candidates.  The League serves as the conduit for obtaining the valuable Content on behalf of Respondent Grassroots.com, and for which the League, CGS and DNet are handsomely compensated. Grassroots.com acknowledges that it will "work with the 1100 Leagues nationwide to gather electoral content".  Exhibit F. The League, in turn, "promotes the use of Grassroots.com" by federal candidates and others. All this is being done after having represented to the Commission (and, in turn, to each federal candidate) that this is a "non-commercial" enterprise. See Exhibit E.

The value to Grassroots.com of the Leagueíss collection of information from federal candidates is demonstrated by Grassroots.com's payment to the League for those activities.  "In exchange for DNet and a license to use the Leagueíss name and logo, the League says it received a stake of four million shares in the company, plus a seat on the board and a promise of 'cash contributions' to the education fund.  With the possibility of the shares' value getting a boost down the road from a lucrative initial public stock offering, the League could wind up with an asset that would fund its activity 'for the next 100 or 200 years,' says Craig Johnson, Grassroots.com's 53 year old co-founder and acting chief executive."  (Exhibit F and Exhibit Q, March 3, 2000 news article by Elizabeth Wasserman, "The Land of the Free and the For Profit", MSN Slate magazine)
 

2. Respondents are providing to federal candidates free of charge specific services and products to benefit the federal candidates' political campaigns.

Both on the web site and in the League's communications with federal candidates, Respondents advise candidates that by participating in the web site, the candidates will be able to obtain web page design, solicit contributions and volunteers for their political campaigns and have access to other campaign services at no charge.  (See Exhibit A; Exhibit R, Grassroots.com website donation page; Exhibit S, March 21, 2000 press release of Grassroots.com, "Grassroots.com Offers All Political Candidates Access to Online Campaign Services from Voterworks.com"; Exhibit T, March 21, 2000 press release of Grassroots.com, "Grassroots.com Acquires Leading Electronic Filing Provider Netfile"; Exhibit U, list of partners).

In soliciting participation from federal candidates, Respondent League advises the candidates that their participation on Respondents' web site is "FREE Advertising" for the candidate's campaign.  Exhibit A.
 
Grassroots.com also provides to federal candidates (and other participants) free of charge a "presence" on the internet, something of acknowledged value.  See Exhibit D "Many local candidates and groups are struggling with setting up a web presence," said Tim Dick, president and chief operating officer, Grassroots.com. "We plan to make it easier for them to get their message out to the voters. . ."

All of these services are a "thing of value" provided at no cost to federal candidates by Respondents in violation of the Act, which prohibits a corporate entity from providing such services free of charge to federal candidates.
 

3. As a result of the substantial investment in Grassroots.com by Knight-Ridder, the links to editorial endorsements will necessarily be influenced by or tied to Knight-Ridder newspapers and media entities.

Respondents advised the Commission in seeking its Advisory Opinion last fall (AO 1999-25) that it would link to newspapers for dissemination of editorial endorsements of federal candidates and that DNet would "make every effort on a nonpartisan basis to link to a "representative sample" of newspapers that have made endorsements in a relevant race".

Knight Ridder is the nation's second largest newspaper publisher with products both in print and on-line.  It publishes 31 daily newspapers in 28 markets and has readership estimated at 9.2 million daily and maintains 45 associated web sites under the name Knight-Ridder Real Cities.  (See Exhibit V, Knight-Ridder Information)

Knight-Ridder has made a substantial financial investment in the Internet, establishing Knight-Ridder.com (Exhibit W) and announcing a major marketing effort to promote its Internet site (Exhibit X, November 16, 1999 press release). This announcement was followed only weeks later by Knight-Ridder's substantial investment in Grassroots.com (See Exhibit P). The Knight-Ridder investment in Grassroots.com gave Knight-Ridder President and CEO Tom Ridder a seat on the Grassroots.com Board of Directors (see Exhibit P).

This "partnership relationship" is acknowledged by Respondents on their website (Exhibit Y, partnership listing) and raises serious questions regarding any republication or dissemination by Respondents of editorial endorsements of federal candidates or links to such editorial endorsements from Respondents web site(s).  The close corporate and financial ties between DNet and one particular major media entity which owns newspapers nationwide were not contemplated or disclosed and are not within the parameters established by the Commission in Advisory Opinion 1999-25 for DNet's links to and republication / dissemination of editorial endorsement(s) of federal candidates.
 

4.  Respondents derive revenues from advertising instead of charging federal candidates for the cost(s) of participating in Respondents' web site.

Whereas Grassroots.com states that it depends for its support upon the selling of advertising to various entities, DNet indicated to the Commission that it is "...funded by contributions from supporters and foundations and does not rely on advertising or customer fees for its support."  (See Exhibit E, AOR Supp. p. 1.)

However, Grassroots.com clearly solicits advertising. (Exhibit Z, from web site "Advertise with Us" and Exhibit C and D, Grassroots.com Fact Sheet)

The posted advertising policy of Grassroots.com sets no limitation on the type(s) of entity(s) permitted to advertise on the web site, which presumably would include political committees, political candidates, and others that may have an interest in influencing federal elections. Indeed, upon logging on to the Grassroots.com web site, there is continuous advertising which is streaming at various sections of the site. (See Exhibit Z, Grassroots.com advertising policy).

Grassroots.com's editorial policy states:  "We generate revenue by selling advertisements in the form of banners, sponsorships, merchant listings, and special advertising sections.  For these reasons, Grassroots.com is committed to clearly drawing the line between editorial content and commerce. . . Grassroots.com may display paid or unpaid hyperlinks to companies, people and organizations outside of Grassroots.com that could be considered controversial by the reader." (Exhibit AA, Grassroots.com Editorial Policy.)

Grassroots.com has encourages an advertising link with the candidate committees by requesting they reference Grassroots.com in their campaign literature.  Exhibit A.  This will, in turn, increase traffic to the website which enhances the commercial value of the corporate entity and assists in the sale of additional advertising on the site itself.  Exhibit BB, Privacy (sic) Statement).
 

5. Respondents' communications with and relationship to federal candidates constitute coordination which disqualifies them from claiming exemption under the "candidate debate" and "voter guide" provisions of the Commission's regulations.

The exemption applicable to 501(c)(3) organizations eligible to undertake candidate debates, appearances, and voter guides which may have been applicable to DNet prior to its acquisition by Grassroots.com pursuant to 11 C.F.R. § 114.4 is no longer available as a result of the transfer of ownership.

In an attempt to include the candidates' participation in the system, Grassroots.com, through its "partner", the League of Women Voters, informs candidates they can post or correct their information on the site and that they (League) will "assist" federal candidates in making their space on Respondents' site operational. The League specifically urges federal candidates' participation by stating that such participation will provide a campaign tool for the public and therefore the candidate is urged to include references to Respondents' site in the candidates' printed materials (thus providing an additional source of advertising for Respondents!) Such a relationship is direct coordination between the candidates and Respondents in violation of the Act.

Respondents further urge federal candidates' participation by classifying it as "FREE advertising" which will be provided to 34 million AOL subscribers". (See Exhibit A)
 

6.  Timing of the various transactions at issue are suspect.

The last and perhaps most disconcerting aspect of the sale of DNet to Grassroots.com by CGS and the League is the timing of the various transactions.  The sequence of events is as follows:
 

DNet's chronological listing on its web site of "important" dates begins with issuance of AO 1999-25 and goes through the acquistion of DNet by Grassroots.com.  (Exhibit CC)

These not-for-profit corporate entities sought and received Commission approval for activities described to the Commission as noncommercial. Within 75 days of the issuance of that opinion, a commercial, for-profit corporation, with substantial investments obtained from a corporation which owns newspapers and other media entities nationwide, acquires the "not for profit" DNet, agreeing to pay cash in "undisclosed sums" to the two 501(c)(3) corporations.

Even measured in "Internet years" this is a very quick turn of events. A serious question must be raised as to the veracity of the facts set forth in the Advisory Opinion Request.  The Commission should ascertain whether there were discussions, negotiations, or understandings prior to the issuance of the AO 1999-25 with respect to Grassroots.com, Knight Ridder, America On-Line or others of the participants regarding a relationship with DNet, CGS or the League prior to the time when AO 1999-25 was issued and, further, whether the Commissioníss decision in AO 1999-25 was of any bearing in Grasssroots.comíss decision to purchase DNet.

 
C. LEGAL ANALYSIS AND BASIS FOR COMPLAINT

1. Violation of 2 U.S.C. § 441b(a); 11 C.F.R. § 114.2(b). Respondents, each of them, are corporate entities.  The Act prohibits a corporation from making any "contribution or expenditure" in connection with a Federal election. 2 U.S.C. 441b(a); 11 CFR 114.2(b). The term "contribution or expenditure" is defined to include "any direct or indirect payment, distribution, loan, advance, deposit, or gift of money, or any services, or anything of value . . . to any candidate, political party or committee, organization, or any other person" in connection with any Federal election. 11 CFR 114.1(a)(1); see also 2 U.S.C. 441b(b)(2). The phrase "anything of value" includes goods or services provided without charge or at less than the usual and normal charge. 11 CFR 100.7(a)(1)(iii)(A) and 100.8(a)(1)(iv)(A).
 

2. The services provided by Respondents have substantial market value, as confirmed by Respondents' actions and public admissions.  The issue the Commission has struggled with concerning activities on the internet with respect to federal candidates has been whether or not the internet provides "anything of value" for purposes of the Act.  Clearly, the Content which appears at Grassroots.com's web site (which is provided by and fully encompasses DNet) is of substantial value, as evidenced by the acquisition or purchase by Grassroots.com of DNet, the cash infusions from Grassroots.com to League and CGS, including Board directorships and stock transfer(s).  Further evidence of the market valuation of the Content is the financial investment of $30 million secured by Grassroots.com simultaneously with its acquisition of DNet.
 

3. Respondents' activities do not come within the "media exemption" of the Act (2 U.S.C. § 431(9)(B)(i)) and are therefore illegal corporate expenditures and contributions.  Respondent Grassroots.com describes itself as a "media and technology company". Knight-Ridder, one of the primary investors in Grassroots.com is clearly a media corporation.

The corporate activities in which Respondents are engaged do not fall within the parameters of the media exemption to the Act.  In fact, the corporate services provided by Respondents to federal candidates are more in the nature of space in a newspaper, which must be paid for by candidates, according to the Act.  2 U.S.C. § 441d.

A newspaper, magazine or broadcast entity is not allowed under the Act to provide free advertising to candidates in which the candidates and campaigns themselves can control the content, solicit contributions and volunteers, etc..  That is precisely the analogy here.

Likewise, Grassroots.com cannot provide at no cost to federal candidates the various goods and services described herein without charge to the candidates without running afoul of the prohibitions of the Act.
 

4. Advisory Opinion 1999-25 was issued based on the 501(c)(3) charitable corporation status of the Respondents, which factor is no longer relevant.  Accordingly, AO 1999-25 is no longer operative as a safe harbor for Respondents to claim as protection from penalties for their ongoing violation(s) of the Act.

On September 1, 1999, DNet, through its legal counsel, submitted to the Commission an Advisory Opinion Request ("AOR") which the Commission identified as AOR 1999-25.

On October 26, 1999, DNet, through its legal counsel, submitted a supplement with enclosures to AOR 1999-25 ("AAOR-Supp").  Both documents are attached hereto and fully incorporated herein by reference (see Exhibit E).

Representations were made that the AOR was being sought by DNet an on-line project of LWVEF and CGS, both of which are 501(c)(3) non-profit, charitable corporations.  In its AOR, DNet highlights the relevancy of being an exempt 501(c)(3) corporate entity for purposes of undertaking the described activities within the framework of the the Act.  "DNet recognizes that its status as a not-for-profit 501(c)(3) corporation is also relevant to this determination under the FEC regulations." (This was proffered in support of the position that DNet services should be considered analogous to the question involving the Minnesota Secretary of Stateíss hyperlinks which was authorized by the Commission in Advisory Opinion 1999-7.)

DNet stated that § 501(c)(3) not-for-profit corporations are entities which may stage candidate debates in accordance with 11 C.F.R. 114.4(f), and requests the Commission recognize DNet as therefore qualified under the the Act to undertake debates on-line.  (AOR at page 8-9).  The AOR also presented a discussion of voter guides and stated that the FEC Regulations at § 114.4 provide special treatment of voter guides which are provided by an entity exempt pursuant to § 501(c)(3) or 501(c)(4).  (AOR at pages 15-16.)  DNet stated that it will not coordinate the on-line voter guides with the candidates, a point of noted concern expressed in the AO.  As a last reference to the importance of its 501(c)(3) status, the AOR also notes the Act exemptions provided to 501(c)(3) organizations pursuant to 11 C.F.R. § 114.4(c)(7)(ii).  Relying upon its tax-exempt status as a 501(c)(3) organization, DNet advocates that it is authorized to permit candidate appearances pursuant to the exemption set out at 11 C.F.R. § 114.4.

The transfer of DNet to a commercial entity causes the narrowly construed exemption crafted by the Commission in AO 1999-25 to be inoperative. The Commissioníss willingness to allow DNet to provide free space to candidates was based on the voter guide and candidate debate exemptions established by the Commission.  Further, the AO turned in no small part on the facts presented to the Commission as to the "non-commercial" nature of DNet.  However, with ownership of DNet now vested in Grassroots.com the Commissioníss basis for permitting the activities at DNet to be exempt from the definition of expenditures no longer exists.

It is clear that these were material representations (or misrepresentations) by DNet, the League and CGS, which representations were relied upon by the Commission in issuing its opinion in AO 1999-25.  Indeed, the Commission expressly noted its reliance upon the representation that the organizations involved in this activity were exempt pursuant to IRC § 501(c)(3).  The Commission stated, "as such, they may not participate or intervene in any political campaign on behalf of or in opposition to any candidate." (AO 1999-25 at page 4)  In conclusion, the Commission noted, "based on the foregoing discussion of the nature of DNet, its sponsoring organizations, and the web site itself, the Commission concludes that DNetíss proposed activity is exempt from the definition of "expenditure" at 2 U.S.C. § 431(9)(b)(ii), and is therefore permissible under the act." (AO 1999-25 at page 7, emphasis added.)

Grassroots.com as a commercial corporate entity is now providing the services which the Commission approved (on a much more narrow basis) for DNet, the League and CGS in AO 1999-25. Respondents are wholly out of compliance with the restrictions imposed upon DNet and upon which the Commission relied in issuing its Advisory Opinion. Respondents are therefore engaging in activities which are clearly prohibited corporate expenditures in violation of 2 U.S.C.§ 441(b).
 

5. Respondents' sale of advertising on the site which provides free space to candidates violates not only the parameters of AO 1999-25 but also the Commissioníss restrictions set forth in AO 1999-24.

Grassroots.com states that it will "generate revenue by selling advertisements in the form of banners, sponsorships, merchant listings and special advertising sections.  For these reasons, Grassroots.com is committed to clearly drawing the line between editorial content and commerce.  Advertisements or sponsorships are clearly labeled as such."

In Advisory Opinion 1999-24, the Commission addressed the issue of commercial sponsorship of space provided by a corporate entity free of charge to federal candidates. The Commission not only considered the fact of such commercial advertising, but also the type and source of advertising appearing on the same site and/or page as the federal candidates' content was seemingly significant to the Commission, which approved the proposal from the requester within the restrictions / parameters cited below:
 

Not only have Respondents taken liberties with the parameters of AO 1999-25, they are completely disregarding the advertising restrictions discussed in AO 1999-24.  Apparently, Respondents have determined that the rules and regulations applied to others simply do not apply to them.
 

6. Respondents' providing free email communications links to federal candidates violates the Commission's decision in AO 1996-2.

Respondents are advising federal candidates that by participating in Respondents' web site, the candidates will have free electronic mail link capability provided by Respondents. The Commission concluded in AO 1996-2 that Compuserve could not furnish accounts for electronic mail and communications free of charge to federal candidates and specifically denied Compuserve's request to do so on the basis that it would constitute an illegal corporate contributions to federal candidates.

 
 
CONCLUSION

Based upon the preceding set of facts and legal analysis, the undersigned hereby contend that Respondents, all of them, are violating the referenced provisions of the Act, which justify an investigation by the Commission and an appropriate civil or equitable remedy.
 

Respectfully submitted,

Peter Flaherty,
President
National Legal and Policy Center
 
 

ENDNOTES:
(1) The identity of the federal candidate to whom this solicitation was sent has been redacted to protect the confidentiality of the individual candidate and whose identity is not significant to this Complaint.
(2) AOR 1999-25, September 1, 1999 and Supplement to AOR 1999-25, October 26, 1999.  Enclosures omitted.
 
 




Related Media Release

Grassroots.com's Internal Email Responding to NLPC's Complaint

Formal Request for Investigation of Improper Contact with FEC by Grassroots.com
 

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