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Legal Guidance On Joining The Social Media Craze Bailey

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Ashley Bailey, Counsel, Crowell & Moring LLP presented on "Legal Guidance on Joining the Social Media Craze and Your Political Programs".

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Legal Guidance On Joining The Social Media Craze Bailey

  1. 1. The Amazing Race: Legal Guidance on Joining the Social Media Craze and Your Political Programs Ashley N. Bailey Crowell & Moring, LLP Washington, D.C. (202) 624-2732 December 2009
  2. 2. Risks for Corporations Federal Campaign Finance Law Citizens United v. Federal Election Commission
  3. 3. Risks for For-Profit Corporations Federal Campaign Finance Law <ul><li>Avoiding Prohibited Corporate Contributions </li></ul><ul><li>Observing Limitations on PAC Solicitations </li></ul><ul><li>Distinguishing Permissible Individual Activity From Corporate Activity </li></ul>
  4. 4. Avoiding Prohibited Corporate Contributions <ul><li>Corporate contributions and expenditures to candidates, political parties, and committees in connection with federal elections are prohibited. </li></ul><ul><li>Corporate facilitation of political contributions are prohibited. </li></ul><ul><li>State law differs dramatically by jurisdiction. </li></ul>
  5. 5. Observing Limitations on Solicitations for Contributions to the Corporate PAC <ul><li>Solicitations for contributions to the corporate PAC on the corporate website must be accessible solely by the restricted class. </li></ul><ul><ul><li>Password protected web pages approved by the FEC. AO 2006-03; 2000-07. </li></ul></ul><ul><ul><li>Merely commending employees for their participation constitutes a solicitation. </li></ul></ul><ul><ul><li>Electronic signatures permitted for payroll deductions. </li></ul></ul>
  6. 6. <ul><li>Analogizing candidate participation in web-based applications to candidate appearances at teleconferences. </li></ul><ul><ul><li>Teleconferences featuring candidates </li></ul></ul><ul><ul><li>have been approved by FEC, so long </li></ul></ul><ul><ul><li>as participation is confined to restricted </li></ul></ul><ul><ul><li>class. Otherwise, observe rules for candidate </li></ul></ul><ul><ul><li>appearances on corporate premises. AO2007-14. </li></ul></ul><ul><li>Analogizing candidate endorsement on corporate website with corporate candidate endorsement in a press release. </li></ul><ul><ul><li>Candidate endorsement on corporate website </li></ul></ul><ul><ul><li>prohibited. See FEC publication on Internet </li></ul></ul><ul><ul><li>Communications and Activity. </li></ul></ul>
  7. 7. Distinguishing Individual Activity From Corporate Activity <ul><li>Political activity on the Internet by individuals in their individual capacity is not highly regulated by federal government. (Check state law where it applies.) </li></ul><ul><li>Avoid risk that statements using corporate e-mail, corporate Facebook pages, etc. may be attributed to the corporation. </li></ul><ul><li>Avoid risk that messages of individual corporate managers on My Space, Facebook, etc. may be viewed as corporate statements if the corporation’s name is invoked. – Seek guidance of counsel . </li></ul><ul><li>Websites of political committees must include disclaimer stating who has paid for the content and whether statements have been authorized by a candidate. See 11 C.F.R. § 110.11 for further requirements. E-mail blasts of more than 500 by political committees must also include disclaimer. </li></ul>
  8. 8. Social media provides ample opportunity for corporate managers to go dangerously off script!
  9. 9. Social media provides ample opportunity for corporate managers to go dangerously off script! <ul><li>The Risks </li></ul><ul><li>Coercive Communications to Employees </li></ul><ul><li>Promises of Bonuses = Straw Contributions </li></ul><ul><li>Solicitations Outside the Restricted Class </li></ul>
  10. 10. Risks for 501(c)(3) Organizations Campaign Finance Law <ul><li>Issue Advocacy vs. Campaign Intervention </li></ul><ul><ul><ul><li>Whether the statement identifies a candidate. </li></ul></ul></ul><ul><ul><ul><li>Whether the statement expresses approval/disapproval for a candidate’s position. </li></ul></ul></ul><ul><ul><ul><li>Proximity of statement to an election. </li></ul></ul></ul><ul><ul><ul><li>Whether the statement references voting or an election. </li></ul></ul></ul><ul><ul><ul><li>Whether the issue addressed has been raised as an issue distinguishing candidates. </li></ul></ul></ul><ul><ul><ul><li>Whether the statement is part of an ongoing series made independent of timing of election. </li></ul></ul></ul><ul><ul><ul><li>Whether timing of communication and identification of candidate is unrelated to an electoral event (e.g., relates to an upcoming vote on legislation). </li></ul></ul></ul>
  11. 11. Risks for 501(c)(3) Organizations Campaign Finance Law <ul><li>May a 501(c)(3) provide a link to a candidate-related material? </li></ul><ul><ul><li>Factors: </li></ul></ul><ul><ul><ul><li>Whether the link furthers the organization’s exempt purpose. </li></ul></ul></ul><ul><ul><ul><li>Whether other candidates are represented. </li></ul></ul></ul><ul><ul><ul><li>The directness of the link to political content. </li></ul></ul></ul><ul><ul><li>Continually monitor linked content! </li></ul></ul>
  12. 12. Risks for 501(c)(3) Organizations Campaign Finance Law <ul><li>May a 501(c)(3) host candidate appearances in chat rooms? </li></ul><ul><ul><li>Analogizing to rules for in-person events, only if the following criteria are met: </li></ul></ul><ul><ul><ul><li>Other candidates for the same office are given an equal opportunity. </li></ul></ul></ul><ul><ul><ul><li>The organization expresses no support or opposition to the candidate. (State it explicitly). </li></ul></ul></ul><ul><ul><ul><li>No political fundraising is conducted. </li></ul></ul></ul>
  13. 13. Risks for Corporations Lobbying Restrictions <ul><li>Lobbying may not constitute a “substantial part” of a 501(1)(c) organization’s activities. </li></ul><ul><li>Communications to officials via electronic methods may constitute lobbying. </li></ul>
  14. 14. <ul><li>Hosting chat rooms for members/supporters with “covered” officials. </li></ul><ul><ul><li>If the hosting organization does not intend to lobby, take precautionary measures to avoid attribution of member/supporter statements to the hosting organization. </li></ul></ul>
  15. 15. Crowell & Moring White Collar & Regulatory Enforcement Group What We Do <ul><li>Conduct and Navigate Investigations </li></ul><ul><ul><li>Internal Investigations </li></ul></ul><ul><ul><li>FBI, DOJ, U.S. Attorneys </li></ul></ul><ul><ul><li>SEC </li></ul></ul><ul><ul><li>FINRA </li></ul></ul><ul><ul><li>FEC </li></ul></ul><ul><ul><li>IRS </li></ul></ul><ul><ul><li>CFTC </li></ul></ul><ul><ul><li>Congressional Committees </li></ul></ul><ul><ul><li>Agency Inspectors General </li></ul></ul><ul><ul><li>Special / Independent Counsels </li></ul></ul><ul><ul><li>State AGs & Licensing Boards </li></ul></ul><ul><li>Trial, Sentencing, Appeal </li></ul><ul><li>Negotiate with Regulators </li></ul><ul><li>Advise </li></ul><ul><li>Train </li></ul><ul><li>Create Compliance Programs </li></ul>
  16. 16. Crowell & Moring White Collar & Regulatory Enforcement Group Areas of Expertise <ul><li>Fraud & False Claims/Qui Tam Suits </li></ul><ul><li>Procurement Fraud </li></ul><ul><li>Foreign Bribery (FCPA) </li></ul><ul><li>Securities Regulation & Enforcement </li></ul><ul><li>Financial Services </li></ul><ul><li>Antitrust </li></ul><ul><li>Health Care </li></ul><ul><li>Employment Safety </li></ul><ul><li>Tax </li></ul><ul><li>Environment & Natural Resources </li></ul><ul><li>Energy </li></ul><ul><li>Lobbying/Campaign Finance </li></ul><ul><li>Public Corruption </li></ul><ul><li>Intellectual Property Enforcement </li></ul><ul><li>Obstruction & False Statements </li></ul>

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