Hadn’t to my knowledge (but I can’t rule out the possibility that I had seen it in previous forum lurking a while ago and just don’t remember). One conscious trigger, at least, was hearing about how SBF and others at FTX gave tens of millions to different parties and shaking my head at the waste (this was before the origin of those funds was fully known).
Caveat: I am a lawyer but am not speaking with any real assessment of the merits beyond a skim of the FEC letter back in 2015. The viewpoint below is based on general principles of civil litigation strategy and is not something anyone should actually rely on without talking to a campaign-finance expert.
My initial reaction to the threat of legal challenges, if someone thinks there is enough potential value here, is to commit to funding this appropriately and just let them sue. If you were particularly worried about litigation, set it up the first time so that the only candidate pair is from the general-election presidential race. That should sharply limit the number of entities that have Article III standing to file a lawsuit, maybe just to the candidates and their campaign committees themselves. Make one of them risk the negative publicity of filing a lawsuit to shut down a non-profit website that was benefitting impoverished people in Africa. In any event, do not set up a pair in a House or Senate race where one of the candidates is a sure loser (who makes a good sacrificial lamb for a political party that wants the website shut down) or a clear winner (who can probably risk a reputational hit).
In a sense, this creates a bifurcation of risk—there’s a risk the website just doesn’t catch on, and a risk of litigation, but probably a low risk of both at the same time. What rational candidate is going to commit money to litigation to secure an a small amount of additional funds for themselves when: (1) the amount isn’t that much; (2) they alone bear optics/PR risk; (3) their opponent gets the exact same benefit they get without incurring any of the costs? For litigation to make sense, you’d either need to believe the amount of money coming through this site was going to be pretty significant, or would need to believe that the marginal benefit of an extra dollar to your campaign was much greater than for your opponent.
Next, any litigation would likely be—like many election-related challenges—only practically winnable in accelerated proceedings. With a favorable FEC opinion letter, few district judges would grant emergency relief to a litigant like a temporary restraining order. In ordinary litigation, the federal courts can take a while to get around to deciding whether to grant a preliminary injunction. Would a judge be inclined to put this high on their priority list? Depends on the judge, but I think it would only get priority if pretty successful. The ship may well have sailed by then—and note that a decision by a district court is often not a particularly effective weapon for other litigants who want to sue you in future elections. (For the lawyers, if there is a concern about offensive collateral estoppel, I think the solution is for the next attempt to be with a different, unrelated non-profit with whom the first non-profit is not in privity.)
If the court did grant a preliminary injunction, I would ask the court to (1) require the organization to pass through 100% of funds to both sides, but (2) require the opposing party to post an injunction bond in the amount lost to charity [at least to its own candidate]. Injunction bonds aren’t required as often as I think they should be, but it would be worth a shot. Alternatively, you could ask that the organization be allowed to continue but required to lock up the money pending final judgment.
I’d also consider whether to stick a nice “poison pill” in the user agreement. Suppose that there were an adverse litigation outcome—what should happen to the money? You could try adding a provision that it has to be returned to the donors, attempting to deprive the plaintiff of any concrete benefit from winning the suit in the first place. They would be no better off, unless and until their would-be donors chose to give them the money. And, if I were a candidate, I would be worried that some percentage of my donors would be annoyed at my litigation antics and that my opponent’s donor re-gift rate would be higher.
I suspect Professor Zolt didn’t move forward in part because (if I understand correctly) his for-profit entity was going to be funded by a tiny sliver of the funds flowing through the entity. That’s probably not enough revenue to justify defending this in litigation. On the other hand, if the monies were going to something like GiveDirectly (more legible) or AMF, the EA community “captures” the vast majority of the value of the offset funds. So the community should more willing to accept a quarter-million in expected litigation costs if the idea has upside to drive at least several times that to effective charities.
Finally, a less effective but potentially “safer” way to do something along the same lines would be to form a SuperPAC. I am reminded of the one Stephen Colbert did back in his Colbert Report days as a parody of the campaign-finance system. That’s a much harder attack surface, as the main attraction of SuperPACs is that they are . . . unregulated.
I would have to check whether a SuperPAC can donate to another SuperPAC, which would be an easy way of getting rid of the non-netted funds. Simply returning the non-netted funds might be another option. Actually running ads would be awkward. Colbert donated most of the proceeds of his super-PAC to non-political charities when he dissolved it, so shipping the netted funds to the chosen charit(ies) at the end of the election shouldn’t be a problem. The biggest downside of this approach, in addition to probably being less legible to would-be donors, is that donations to a superPAC definitely are not tax-deductible (vs. I don’t know if netted donations to something like I originally suggested would be).
Have you seen this post? Getting money out of politics and into charity
Hadn’t to my knowledge (but I can’t rule out the possibility that I had seen it in previous forum lurking a while ago and just don’t remember). One conscious trigger, at least, was hearing about how SBF and others at FTX gave tens of millions to different parties and shaking my head at the waste (this was before the origin of those funds was fully known).
Caveat: I am a lawyer but am not speaking with any real assessment of the merits beyond a skim of the FEC letter back in 2015. The viewpoint below is based on general principles of civil litigation strategy and is not something anyone should actually rely on without talking to a campaign-finance expert.
My initial reaction to the threat of legal challenges, if someone thinks there is enough potential value here, is to commit to funding this appropriately and just let them sue. If you were particularly worried about litigation, set it up the first time so that the only candidate pair is from the general-election presidential race. That should sharply limit the number of entities that have Article III standing to file a lawsuit, maybe just to the candidates and their campaign committees themselves. Make one of them risk the negative publicity of filing a lawsuit to shut down a non-profit website that was benefitting impoverished people in Africa. In any event, do not set up a pair in a House or Senate race where one of the candidates is a sure loser (who makes a good sacrificial lamb for a political party that wants the website shut down) or a clear winner (who can probably risk a reputational hit).
In a sense, this creates a bifurcation of risk—there’s a risk the website just doesn’t catch on, and a risk of litigation, but probably a low risk of both at the same time. What rational candidate is going to commit money to litigation to secure an a small amount of additional funds for themselves when: (1) the amount isn’t that much; (2) they alone bear optics/PR risk; (3) their opponent gets the exact same benefit they get without incurring any of the costs? For litigation to make sense, you’d either need to believe the amount of money coming through this site was going to be pretty significant, or would need to believe that the marginal benefit of an extra dollar to your campaign was much greater than for your opponent.
Next, any litigation would likely be—like many election-related challenges—only practically winnable in accelerated proceedings. With a favorable FEC opinion letter, few district judges would grant emergency relief to a litigant like a temporary restraining order. In ordinary litigation, the federal courts can take a while to get around to deciding whether to grant a preliminary injunction. Would a judge be inclined to put this high on their priority list? Depends on the judge, but I think it would only get priority if pretty successful. The ship may well have sailed by then—and note that a decision by a district court is often not a particularly effective weapon for other litigants who want to sue you in future elections. (For the lawyers, if there is a concern about offensive collateral estoppel, I think the solution is for the next attempt to be with a different, unrelated non-profit with whom the first non-profit is not in privity.)
If the court did grant a preliminary injunction, I would ask the court to (1) require the organization to pass through 100% of funds to both sides, but (2) require the opposing party to post an injunction bond in the amount lost to charity [at least to its own candidate]. Injunction bonds aren’t required as often as I think they should be, but it would be worth a shot. Alternatively, you could ask that the organization be allowed to continue but required to lock up the money pending final judgment.
I’d also consider whether to stick a nice “poison pill” in the user agreement. Suppose that there were an adverse litigation outcome—what should happen to the money? You could try adding a provision that it has to be returned to the donors, attempting to deprive the plaintiff of any concrete benefit from winning the suit in the first place. They would be no better off, unless and until their would-be donors chose to give them the money. And, if I were a candidate, I would be worried that some percentage of my donors would be annoyed at my litigation antics and that my opponent’s donor re-gift rate would be higher.
I suspect Professor Zolt didn’t move forward in part because (if I understand correctly) his for-profit entity was going to be funded by a tiny sliver of the funds flowing through the entity. That’s probably not enough revenue to justify defending this in litigation. On the other hand, if the monies were going to something like GiveDirectly (more legible) or AMF, the EA community “captures” the vast majority of the value of the offset funds. So the community should more willing to accept a quarter-million in expected litigation costs if the idea has upside to drive at least several times that to effective charities.
Finally, a less effective but potentially “safer” way to do something along the same lines would be to form a SuperPAC. I am reminded of the one Stephen Colbert did back in his Colbert Report days as a parody of the campaign-finance system. That’s a much harder attack surface, as the main attraction of SuperPACs is that they are . . . unregulated.
I would have to check whether a SuperPAC can donate to another SuperPAC, which would be an easy way of getting rid of the non-netted funds. Simply returning the non-netted funds might be another option. Actually running ads would be awkward. Colbert donated most of the proceeds of his super-PAC to non-political charities when he dissolved it, so shipping the netted funds to the chosen charit(ies) at the end of the election shouldn’t be a problem. The biggest downside of this approach, in addition to probably being less legible to would-be donors, is that donations to a superPAC definitely are not tax-deductible (vs. I don’t know if netted donations to something like I originally suggested would be).