The Federal Election Commission (FEC) has decided not to appeal a September ruling by a three-judge panel of the U.S. Court of Appeals for the D.C. Circuit in EMILY’s List v. FEC. That opinion struck down FEC regulations that limited donations to some nonprofit groups that engage in campaign activity. The FEC’s decision not to appeal may have major implications for campaign finance issues, as well as certain nonprofits' activity during upcoming elections in 2010 and 2012.

The appeals court ruled that the FEC regulations violated EMILY's List's speech rights in violation of the U.S. Constitution. EMILY’s List is a non-connected nonprofit political action committee (PAC) that seeks to elect pro-choice, Democratic women to office. In 2005, the group challenged the FEC's regulations as they relate to the treatment of funds received in response to certain solicitations and amended rules regarding federal/nonfederal fund allocation ratios for PACs.

There has been much speculation since the EMILY’s List ruling as to whether the FEC would appeal. There are many reasons why the FEC’s decision not to appeal is unsurprising. Currently, there is a deep partisan divide on the FEC, and that divide was evident in the FEC's decision not to appeal. All three Democratic commissioners voted to appeal the decision while the three Republican commissioners voted not to appeal it. With the commission split 3-3, there was not the clear majority needed to proceed with an appeal. This split is consistent with other partisan schisms at the FEC over the past year.

The FEC had the option to appeal to an en banc court comprised of the appeals court’s nine judges, rather than accept the decision from the original three-judge panel that decided the case. However, the likelihood that an en banc court would have affirmed the panel’s decision may have played a role in the FEC’s decision not to appeal the case. Since the September decision striking down the FEC regulations was unanimous, five of the remaining six judges would have had to vote to uphold the regulations. This "seems highly unlikely based on the record of those judges," according to the Center for Competitive Politics. Thus, the Center concludes that, “an en banc appeal would most likely be a waste of time."

Campaign finance reform groups see this as an issue that tends to break down partisan lines. Democracy 21 President Fred Wertheimer said in a statement that "[n]ormally government agencies take actions to defend the constitutionality of the regulations they have issued, but [the Oct. 22] vote by the Republican FEC Commissioners to block an FEC appeal continues their pattern of doing everything they can to emasculate the nation’s campaign finance enforcement agency and thereby to emasculate the nation’s campaign finance laws."

Paul Ryan, an election law expert at the Campaign Legal Center, told Politico that the "EMILY’s List decision, if allowed to stand, loosens the campaign finance law restrictions on committees like EMILY’s List and allows them to use more soft money to engage in activities that arguably influence federal elections." This could result in an unprecedented amount of "soft money," which is unlimited donations to certain nonprofit groups by individuals, corporations, political action committees and unions for use during elections.

Charlie Spies, an election lawyer who has represented the Republican National Committee, believes that "an appeal would further upend the already shifting election law landscape heading into the 2010 midterm elections," according to Politico. "It is important for groups planning to participate in the political process to have certainty going into 2010, and the commission is helping provide that by not appealing the court's decision," Spies told Politico.

There is some speculation about whether Solicitor General Elena Kagan can still appeal the case to an en banc court. "There is no doubt that Kagan could take the case to the Supreme Court now; legal analysts are not sure she has the option of seeking en banc review, or whether that was a choice left to the FEC," according to the Supreme Court of the United States Blog.

The Center for Competitive Politics notes that the "Solicitor General represents the FEC in the Supreme Court, and can appeal statutory and constitutional questions even if the FEC does not ask her to do so. However, such action by the SG is extremely rare. Moreover, it is not entirely clear that she can appeal a regulation without the agency's acceptance – her authority is to defend "statutes" of the United States. No statute is at issue in Emily's List. It would be strange indeed for the Solicitor General to seek certiorari in the Supreme Court in order to defend the validity of a regulation that the agency itself does not believe is constitutional, and it would seem a waste of the Supreme Court's time to hear such an odd appeal."

Most legal experts, however, believe that the Solicitor General can appeal the case even if the FEC does not support the decision, according to Politico. Kagan is studying the decision, according to The Hill and Roll Call.

What remains clear is that if the outcome of this case stands, it has created a new standard for election-oriented nonprofits to raise and spend unlimited funds to directly support or oppose a candidate’s campaign. The results suggest major implications on the upcoming elections in 2010 and 2012.