Iowa group that backed Ernst fights to block donor disclosure

A group that supported U.S. Sen. Joni Ernst’s 2020 re-election bid is asking a federal judge to dismiss a lawsuit it says would give “the wolf the keys to the henhouse” and allow others to “rifle through” records pertaining to its donors.

The Clive-based group Iowa Values allegedly spent close to $1.5 million supporting the Iowa Republican senator’s successful re-election campaign, and is now being sued in federal court by the Campaign Legal Center, a national, non-partisan advocacy group.

The lawsuit marks the first known use of an obscure provision in federal campaign law that allows a private individual or group to take a claim of campaign finance violations directly to federal court. It was triggered by the Federal Election Commission’s inaction on a complaint the CLC filed against Iowa Values in 2019.

Although the FEC is the agency tasked with administering campaign finance laws, for several months the commission lacked enough members to conduct its business, creating a backlog of hundreds of cases. The agency regained its quorum in December 2020 with the Senate’s approval of three new commissioners.

Iowa Values is a nonprofit, tax-exempt corporation, and is not registered as a federal political committee subject to laws requiring the disclosure of donors. However, federal campaign finance laws require organizations whose “major purpose” is campaign activity, and which receive contributions or make expenditures of more than $1,000 per year, to register with the FEC as a political committee and file periodic reports disclosing its receipts, disbursements, and debts.

So-called “dark money” organizations are allowed to raise and spend unlimited amounts of money to support a candidate or attack his or her opponent without revealing their donors, but the law forbids such groups from coordinating those efforts with a candidate’s campaign.

Records obtained by the Associated Press show that a registered fundraiser for the Ernst campaign, Claire Holloway Avella, wrote to potential donors “on behalf of Iowa Values” in July 2019 and stated the “purpose of our group, Iowa Values, is to push back against these negative attack ads” against Ernst.

In her email and in an attached strategy memo, Avella asked for contributions of $50,000 to help Iowa Values shore up support for Ernst among the Iowa voters who “represent the ‘firewall’ between winning and losing in 2020 for Senator Ernst.” She assured the potential donors their contributions to Iowa Values would not be publicly disclosed.

One of the ads Iowa Values ran that year stated, “We deserve leaders who share our values, like Joni Ernst.” Another ad stated, “We deserve leaders who have walked in our shoes and share these beliefs — like Joni Ernst, standing up for Iowans all across our state and fighting for what we believe in.”

In court, Iowa Values is now arguing those ads are mere “issue advocacy” and don’t contain the “magic words” of expressly encouraging people to vote for Ernst. The CLC argues the ads “could only be interpreted by a reasonable person as advocating Senator Ernst’s reelection.”

In seeking to dismiss the CLC’s lawsuit, attorneys for Iowa Values are arguing the case should remain with the FEC.

“Not content to wait for the commission to work through the significant backlog of cases before it as a result of an 18-month-long lack of quorum, CLC now asks this court to short-circuit those parallel proceedings,” Iowa Values says in its motion to dismiss.

Iowa Values claims that by refusing to close cases when the commission was unable to reach a quorum, the FEC created the “appearance of an unlawful delay when, in fact, the commission has already voted and simply failed to secure the requisite four votes to close the file.”

The Clive-based group argues that if the court allows the case to proceed, the CLC “would be permitted access to rifle through Iowa Values’ confidential files and potentially even to depose Iowa Values’ donors.”

Even if the court were to make use of protective orders and sealed filings to keep certain disclosures shielded from public view, the CLC would still win access to “exactly the types of information it will presumably seek” during the discovery phase of litigation, Iowa Values argues.

As for the basis of the CLC’s original complaint, Iowa Values says its pre-election ads do not amount to advocating for Ernst’s re-election.

“Merely recognizing an incumbent politician’s ‘leadership’ a year and a half before that politician will even run” isn’t the equivalent of an appeal to vote for that politician, the organization says, adding that “a reasonable person could certainly perceive such a communication as simply thanking the politician for their previous stances and votes on matters of policy or their provision of moral leadership.”

Iowa Values says the lawsuit was filed by CLC “purely out of animus against groups like Iowa Values and a speculative hunch. Permitting this case to proceed would be tantamount to giving the wolf the keys to the henhouse.”

CLC has argued against dismissal, calling Iowa Values “a dark money group that solicited and spent thousands of dollars in undisclosed money to influence a hotly contested race for the United States Senate.”

A hearing on Iowa Values’ motion to dismiss has yet to be scheduled.