Legal Guidance On Joining The Social Media Craze Bailey

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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

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

Transcript of Legal Guidance On Joining The Social Media Craze Bailey

Page 1: Legal  Guidance On  Joining The  Social  Media  Craze   Bailey

The Amazing Race: Legal Guidance on Joining the Social Media Craze and

Your Political Programs

Ashley N. BaileyCrowell & Moring, LLP

Washington, D.C.(202) 624-2732December 2009

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Risks for Corporations Federal Campaign Finance Law

Citizens United

v. Federal Election

Commission

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Risks for For-Profit Corporations Federal Campaign Finance Law

• Avoiding Prohibited Corporate Contributions

• Observing Limitations on PAC Solicitations

• Distinguishing Permissible Individual Activity From Corporate Activity

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Avoiding Prohibited Corporate Contributions

Corporate contributions and expenditures to candidates, political parties, and committees in connection with federal elections are prohibited.

Corporate facilitation of political contributions are prohibited.

State law differs dramatically by jurisdiction.

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Observing Limitations on Solicitations for Contributions to

the Corporate PAC

Solicitations for contributions to the corporate PAC on the corporate website must be accessible solely by the restricted class.

– Password protected web pages approved by the FEC. AO 2006-03; 2000-07.

– Merely commending employees for their participation constitutes a solicitation.

– Electronic signatures permitted for payroll deductions.

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Analogizing candidate participation in web-based applications to candidate appearances at teleconferences.

– Teleconferences featuring candidates have been approved by FEC, so long as participation is confined to restricted class. Otherwise, observe rules for candidate appearances on corporate premises. AO2007-14.

Analogizing candidate endorsement on corporate website with corporate candidate endorsement in a press release.

– Candidate endorsement on corporate website prohibited. See FEC publication on Internet Communications and Activity.

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Distinguishing Individual Activity From Corporate Activity

• Political activity on the Internet by individuals in their individual capacity is not highly regulated by federal government. (Check state law where it applies.)

• Avoid risk that statements using corporate e-mail, corporate Facebook pages, etc. may be attributed to the corporation.

• 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.

• 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.

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Social media provides ample opportunity for corporate managers to

go dangerously off script!

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Social media provides ample opportunity for corporate managers to

go dangerously off script!

The Risks Coercive Communications to Employees

Promises of Bonuses = Straw Contributions

Solicitations Outside the Restricted Class

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Risks for 501(c)(3) Organizations

Campaign Finance LawIssue Advocacy vs. Campaign Intervention

• Whether the statement identifies a candidate.

• Whether the statement expresses approval/disapproval for a candidate’s position.

• Proximity of statement to an election.

• Whether the statement references voting or an election.

• Whether the issue addressed has been raised as an issue distinguishing candidates.

• Whether the statement is part of an ongoing series made independent of timing of election.

• Whether timing of communication and identification of candidate is unrelated to an electoral event (e.g., relates to an upcoming vote on legislation).

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Risks for 501(c)(3) Organizations

Campaign Finance Law

• May a 501(c)(3) provide a link to a candidate-related material?

– Factors:• Whether the link furthers the organization’s exempt purpose.• Whether other candidates are represented.• The directness of the link to political content.

– Continually monitor linked content!

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Risks for 501(c)(3) Organizations

Campaign Finance Law• May a 501(c)(3) host candidate appearances in

chat rooms?

– Analogizing to rules for in-person events, only if the following criteria are met:

• Other candidates for the same office are given an equal opportunity.

• The organization expresses no support or opposition to the candidate. (State it explicitly).

• No political fundraising is conducted.

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Risks for CorporationsLobbying Restrictions

• Lobbying may not constitute a “substantial part” of a 501(1)(c) organization’s activities.

• Communications to officials via electronic methods may constitute lobbying.

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Hosting chat rooms for members/supporters with “covered” officials.

– If the hosting organization does not intend to lobby, take precautionary measures to avoid attribution of member/supporter statements to the hosting organization.

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Crowell & Moring White Collar & Regulatory Enforcement Group

What We Do

• Conduct and Navigate Investigations

– Internal Investigations

– FBI, DOJ, U.S. Attorneys

– SEC

– FINRA

– FEC

– IRS

– CFTC

– Congressional Committees

– Agency Inspectors General

– Special / Independent Counsels

– State AGs & Licensing Boards

• Trial, Sentencing, Appeal

• Negotiate with Regulators

• Advise

• Train

• Create Compliance Programs

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Crowell & Moring White Collar & Regulatory Enforcement Group

Areas of Expertise

• Fraud & False Claims/Qui Tam Suits

• Procurement Fraud

• Foreign Bribery (FCPA)

• Securities Regulation & Enforcement

• Financial Services

• Antitrust

• Health Care

• Employment Safety

• Tax

• Environment & Natural Resources

• Energy

• Lobbying/Campaign Finance

• Public Corruption

• Intellectual Property Enforcement

• Obstruction & False Statements