Federal Election Commission Main Page
March 25, 2004
CERTIFIED MAIL
RETURN RECEIPT REQUESTED
ADVISORY OPINION 2004-06
Marc E. Elias, Esq.
Brian G. Svoboda, Esq.
Perkins Coie, LLP
607 Fourteenth Street, NW
Washington, DC 20005-2011
Dear Mssrs. Elias and Svoboda:
This refers to your letters dated October 7, 2003, and
January 12, 2004, and your subsequent electronic mail message
of February 1, 2004, on behalf of Meetup, Inc. ("Meetup")
concerning the application of the Federal Election Campaign
Act of 1971, as amended ("the Act"), and Commission
regulations to Meetup's provision of its Web-based event
planning services to Federal candidates. As explained below,
the Commission concludes that Meetup may provide both its
free and fee-based services to Federal candidates, political
committees, and their supporters so long as it does so on the
same terms and conditions available to all similarly situated
persons in the general public.
Background
Free Basic Services
Meetup offers a commercial, Web-based platform for
arranging local gatherings on more than 1,840 topics
suggested by users. Meetup lists the suggested topics for
the local gatherings on Meetup.com and its Web-based software
enables interested persons to register to meet up with others
at a physical location to discuss the specified topic. Users
typically "host" the "meetups" and bear all the costs
associated with each event. You explain that Meetup "does
not supervise or arrange the events, other than to provide a
platform for its users." There is no charge for Meetup's
"basic services," which consist of listing a topic on
Meetup.com and enabling a user to sign-up to attend a meetup.
Premium Services
You state that Meetup derives its revenue from two
sources: from establishments that pay to be listed as
possible event venues, and from payment for "premium services
to individuals and organizations." You explain that, for
various levels of fees, Meetup permits entities to "sponsor"
meetups on particular subjects.1 Meetup also lists several
meetups at a given time in its "Featured Meetups" section.
As a condition of sponsorship, each sponsored meetup is
listed in this prominent "Featured Meetups" section for a
fixed period of time, depending on the fee level of the
sponsorship. You further explain that, in exchange for a
separate fee, Meetup permits sponsors to control the text in
the section of the Meetup page where the description of a
meetup is located (the "What" section). The sponsors are
limited to 20 words and 2 hyperlinks in this space. Also for
a fee, sponsors can control the text that appears in e-mails
sent to members of the sponsored meetup. This text is
limited to 500 characters and 2 links per e-mail, and each
member receives 3-5 e-mails per month. Additionally, for a
fee, sponsors can choose to set the top agenda item on their
meetup Web page (this is a suggested discussion topic for the
actual meetup). Meetup also provides the sponsor with the
names and other data of users who indicate that they will
attend the sponsored Meetup and grant Meetup permission to
share their information.
Proposed Activities Relating to Federal Candidates and
Political Committees
Meetup includes a wide variety of topical issues and
subjects in its list of "meetup topics," which are searchable
and also organized into general category groupings. Some of
the meetup topics include the names of candidates for Federal
office and/or Federal political committees or elections,
although a cursory review of Meetup's web site reveals that
the Federal candidate topics comprise only a small percentage
of the topic listings. You indicate that Meetup does not
favor or disadvantage political topics in relation to non-
political topics. You state that Meetup's communications
department regularly posts "Featured Meetups" about
interesting or timely topics, and you indicate that Meetup
will only feature candidate or political committee meetup
events if that candidate or committee is a paid sponsor.
By telephone you advised that Meetup intends to charge
different fees to different classes of sponsors. For
example, all U.S. Senate candidates will be charged one set
of fees while all candidates for the U.S. House of
Representatives will pay a smaller fee for the same type of
services. You explained, however, that Meetup's overall fee
structure is based on a fixed set of criteria consisting of
the volume of users, the geographic reach of the meetup, and
how much the services would tax Meetup's resources. Thus,
Meetup will provide the same services for the same fees and
on the same terms and conditions to all individuals or
entities who are similarly situated in accordance with
Meetup's fixed criteria, whether or not the entities are
Federal candidates, political committees, businesses, or
other entities in the general public.2
Issue
May Meetup include Federal candidates and political
committees in its list of event topics, both in "Featured
Meetups" and throughout its site, without violating the Act's
prohibition on contributions or expenditures by corporations?
Legal Analysis and Conclusions
For the reasons explained below, Meetup may include
Federal candidates and political committees in its list of
meetup topics and Featured Meetups without violating the Act
or Commission regulations.
Meetup is an incorporated entity and is therefore
prohibited from making any "contribution or expenditure" in
connection with a Federal election. 2 U.S.C. 441b(a);
11 CFR 114.2(b). The term "contribution" is defined in the
Act to include "any gift, loan,
advance, or deposit of money or anything of value made by any
person for the purpose of influencing any election for
Federal office." 2 U.S.C. 431(8)(A). In the specific
context of contributions by corporations or labor
organizations, the term "contribution" is also defined to
include "any direct or indirect payment, distribution, loan,
advance, deposit, or gift of money to any candidate, campaign
committee, or political party or organization, in connection
with any election to" Federal office. 2 U.S.C. 441b(b)(2).
A "donation" means "a payment, gift, subscription, loan,
advance, deposit, or anything of value given
to a person, but does not include contributions." 11 CFR
300.2(e). The phrase "anything of value" includes all in-
kind contributions, including the provision of goods or
services without charge or a charge that is less than the
usual and normal charge for such goods or services. 11 CFR
100.52(d)(1), 100.111(e)(1). Section 100.52(d)(2) defines
"usual
and normal charge for goods" as the price of those goods in
the market from which they ordinarily would have been
purchased at the time of the contribution.
Meetup's Provision of Free Basic Services to Candidates and
Political Committees, or Their Supporters, is Not a
Contribution
Although a corporation's provision of a service without
charge to a candidate would ordinarily result in an in-kind
contribution to that candidate under 11 CFR 100.52(d), the
provision of a service that is always provided without charge
to every person does not fall within this general rule. For
example, in Advisory Opinion 1978-60, the Commission
concluded that a television network corporation could give to
the candidate a copy of a videotape segment in which the
candidate appeared, so long as the company's policy was to
provide a videotape copy free of charge to any member of the
public appearing in a newscast. See also AO 1996-11
(incorporated membership organization permitted to provide
candidate speakers with free audio and video tapes of their
own speeches because the tapes would be provided to all
speakers, including candidates.)
Advisory Opinion 1996-2 is distinguishable. There, the
Commission determined that user accounts provided to
candidates without charge by Compuserve, an incorporated
electronic bulletin board service provider, would constitute
in-kind contributions to such candidates. The services
provided by Compuserve, however, were normally offered for a
fee and were only offered without charge to a select group.
Because Meetup provides its basic services to all persons
without charge, its provision of basic services for free is
therefore significantly different than Compuserve's proposal.
Whereas the normal and usual charge for Compuserve's service
was a fixed fee that was waived in some circumstances, the
normal and usual charge for Meetup's basic service is always
zero without any obligation to purchase other services.
Therefore, Meetup would not make a contribution or
expenditure solely by providing these basic services to
Federal candidates in the ordinary course of its business on
the same terms and conditions on which they are offered to
all members of the general public.
Meetup's Provision of Premium Services to Candidates For the
Usual and Normal Fee Is Not a Contribution.
Like any other member of the general public, a Federal
candidate or political committee may "sponsor" meetup topics
at various levels for a fixed set of fees. The Commission
notes that because each fixed fee amount entitles the sponsor
to a specific set of services with clear limits, Meetup does
not reserve the discretion to provide enhanced or reduced
services to a Federal candidate or political committee in
comparison with other similarly situated individuals or
groups who have paid the same fee. For example, while
sponsors may elect to pay a fixed fee to control the text in
the "What" section of the Meetup page or the text that
appears in e-mails sent to members of their sponsored Meetup,
the number of characters in these texts are fixed. Thus,
Meetup would not make a contribution or expenditure solely by
providing Federal candidates and political committees with
the same fixed premium services as provided to any similarly
situated member of the general public, so long as it does so
in the ordinary course of business for the usual and normal
charge. This charge must be set in accordance with the fixed
set of fee criteria you describe and must be applied equally
between the various classes of Federal candidates (i.e.,
presidential candidates, U.S. Senate candidates, and House
candidates) and other businesses or members of the general
public who are similarly situated with respect to the
respective classes of candidates and political committees.
This conclusion is based on the factors described above and
the assumption that the Federal candidates and political
committees will pay for each premium service in a timely
manner such that Meetup would not extend credit to a
candidate or candidate's authorized committee outside the
ordinary course of its business. See 11 CFR 100.55, 116.3
and 116.4.
This conclusion also applies to Federal candidate and
political committee meetups in the list of "Featured
Meetups." Because Federal candidate and political committee
meetups will only be featured in accordance with the fixed
sponsorship fee arrangement, meaning that Meetup will never
exercise its discretion in featuring a candidate or political
committee meetup, no contribution or expenditure will result
solely from Meetup's featuring of a sponsoring candidate's or
political committee's meetup event in the manner you describe
in your request.
This response constitutes an advisory opinion concerning
the application of the Act and Commission regulations to the
specific transaction or activity set forth in your request.
See 2 U.S.C. 437f. The Commission emphasizes that, if there
is a change in any of the facts or assumptions presented, and
such facts or assumptions are material to a conclusion
presented in this advisory opinion, then the requestor may
not rely on that conclusion as support for its proposed
activity.
Sincerely,
(signed)
Bradley A. Smith
Chairman
Enclosures (AOs 1996-11, 1996-2, 1978-60)
_______________________________
1 Although your request refers to both "sponsors" and
"partners," you have clarified by telephone that the two
terms are synonymous for the purposes of your request.
2 As explained below, Meetup will not list a candidate's or
political committee's meetup event in the "Featured Meetup"
list unless the candidate or political committee has paid to
sponsor the meetup event. In this one area candidates and
political committees are treated differently than other
persons because Meetup may list as "Featured Meetups" other,
non-candidate meetup events on different subjects that are
not sponsored meetups.