National Republican Senatorial Committee loses ROP/Lanham Act/UCL claims against alleged "Scam PAC"

National Republican Senatorial Committee v. Red Senate, 2025 WL 819711, No. 8:24-cv-02301-JVS-KES (C.D. Cal. Jan. 14, 2025)

NRSC sued Red State, alleging that it was exploiting Senator Rick Scott’s “name, image, and likeness without his consent to deceive and scam potential donors...” Red State is a Super PAC, which may accept “unlimited contributions” from nearly any domestic source “so long as it does not coordinate its public communications with any federal candidate.” But NRSC alleged that it was a scam, misleading donors “into believing that their contributions will support a particular candidate or cause, when in reality the Scam PAC plows that cash into endless fundraising that ultimately funds little more than the salaries of its officers and its preferred vendors, who profit handsomely.”

NRSC alleged that, according to FEC disclosures, Red Senate raised over $2.6 million in the 2019-2020 election cycle and spent over $1.1 million in total disbursements during the cycle, including over $1 million in operating expenses. The 2021-2022 election cycle had similar numbers, and, at the time the complaint was filed, Red Senate had raised over $300,000 in the current election cycle, and spent over $500,000, with approximately $450,000 going towards operating expenses. Thus, NRSC alleged, Red Senate merely compensates vendors and keeps any leftover cash, harming the candidates “they purport to be supporting” in the process.

Red Senate allegedly allocates the bulk of its spending to Wavecrest or Google Ads. According to the Google Ads Transparency Center, Red Senate has paid between $35,000 to $40,000 for Google ads mentioning Senator Scott, which were shown between 70,000 to 80,000 times throughout the United States. The advertisements specifically state: “Red Senate for Rick Scott - Keep Florida Red in 2024,” and “Red Senate for Rick Scott - Take Back Our Senate in 2024.” Red Senate also reported making independent expenditures in the 2024 Florida Senate race; however, as of October 2, 2024, none of the reported expenditures expressly advocated for Senator Scott or his opponent. Rather, “the reported expenditures served to raise funds for Red Senate while using Rick Scott’s name and likeness.”

Senator Scott allegedly assigned his rights to NRSC, and, “as the only national party committee solely purposed to supporting Republican senate candidates,” NRSC claims to have an independent interest in stopping false advertising and false personification of Republican candidates. NRSC sued for California statutory and common law right of publicity violations, Lanham Act false advertising, and unfair competition under California’s UCL.

The court took judicial notice of the existence of disclaimers on Red Senate’s website, though not their accuracy, and did the same for the content of FEC reports filed by Red Senate. And it took judicial notice of the “fact that there has been significant news media coverage of Senator Rick Scott, his 2025 campaign for re-election to the United States Senate, and his opponent Debbie Mucarsel-Powell.”

Initially, NRSC’s statement that Senator Scott’s assignment was exclusive was sufficient to establish standing to assert his claims as an initial matter. But did Scott have statutory Lanham Act standing? He needed to allege an “injury to a commercial interest in reputation or sales.” NRSC argued that the parties competed in “the political-fundraising marketplace,” meaning that “potentially millions of dollars were diverted from his campaign.” But the complaint didn’t so allege; its only allegations focused on the deception of donors. But the court granted leave to amend. (Seems like “commercial advertising or promotion” is going to be an insuperable barrier here.)

California’s UCL requires “the plaintiff to be the one ‘who has suffered injury in fact and has lost money or property as a result of the unfair competition.’ ” Consequently, “an injured [party’s] assignment of rights cannot confer standing on an uninjured assignee.” NRSC’s allegation of its own interest in stopping false advertising and false personification of Republican candidates was not enough to satisfy this burden; again, there was leave to amend.

As for the California claims, they were subject to anti-SLAPP analysis. NRSC argued that its complaint “challenges Red Senate’s deceptive conduct in fundraising—not the message it conveys in its ads,” so that the lawsuit did not “arise from” any statements that Red Senate made “in relation to political campaigns.” Instead, it arose from its post-speech conduct—its spending allocation. (I thought political spending was speech.) The court was unpersuaded by these arguments. “First, it is well settled that the anti-SLAPP statute applies to conduct in furtherance of the right to free speech, in addition to the protected speech itself. Second, even if the lawsuit as a whole challenges Red Senate’s disbursement of funds, the right of publicity claims specifically target Red Senate’s use of Senator Scott’s name in Google ads.” The speech was itself allegedly wrongful, not merely evidence of a wrongful act (fundraising misconduct). “[H]ad Red Senate never used Senator Scott’s name in its Google advertisements, NRSC would have no right to publicity claims.”

Thus, the burden shifted to NRSC to demonstrate a probability of prevailing on the merits of its claims. For a common law cause of action for commercial misappropriation, a plaintiff must prove: “(1) the defendant’s use of the plaintiff’s identity; (2) the appropriation of plaintiff’s name or likeness to defendant’s advantage, commercially or otherwise; (3) lack of consent; and (4) resulting injury.” The statutory cause of action requires commercial misappropriation.

Red Senate argued that its speech was related to a political campaign, a matter of public interest, and that NRSC couldn’t prove that Scott’s image was used “exclusively” for commercial gain. NRSC’s argument that Red Senate’s speech was unprotected because it was fraudulent lacked sufficient evidence. The exception for political speech isn’t limited to specific types of political campaigns; nor does the “underlying purpose of one’s dissemination of a political message” determine whether an exception applies. Motion to strike granted, with leave to amend. (How could there be a successful amendment, especially for the statutory cause of action?)