## Facts

- Karl Rove Company provided direct-mail fundraising services for Richard Thornburgh’s 1991 U.S. Senate special-election campaign under an arrangement made for the unincorporated “Thornburgh for Senate Committee.”
- Campaign aide Murray Dickman, a longtime Thornburgh associate with major campaign responsibilities, negotiated the relationship with Karl Rove Company and acted as the committee’s representative.
- The parties proceeded according to a written contract’s terms, and Karl Rove Company performed extensive services, but the campaign ended with an unpaid balance of roughly $169,000–$170,000.
- Thornburgh contended he did not authorize the specific contract and was unaware of its terms, though he knew direct-mail fundraising was being conducted.
- Thornburgh participated in the direct-mail effort, including providing a signature exemplar and reviewing or approving fundraising letters.
- Karl Rove Company sued Thornburgh, the committee, and the treasurer, Raymond Dimuzio, in federal district court (diversity) seeking payment.
- The district court held Thornburgh and the committee jointly and severally liable and dismissed Dimuzio for lack of personal jurisdiction.

## Issues

1. Whether FECA preempted state contract and agency law so as to bar holding a federal candidate personally liable for debts incurred by an unincorporated principal campaign committee.
2. Whether, under applicable state law principles of contract, agency, and ratification, Thornburgh could be held personally liable for the committee’s unpaid contractual obligation to Karl Rove Company.
3. Whether the district court properly dismissed claims against the committee treasurer for lack of personal jurisdiction, and whether that issue required resolution on appeal.

## Decision

- The Fifth Circuit affirmed the judgment holding Thornburgh personally liable for the unpaid campaign debt.
- The court held FECA’s preemption provision did not extend to state-law rules determining who is liable on campaign contracts and did not immunize a candidate from personal liability for an unincorporated committee’s debts.
- Applying state law, the court upheld findings that Dickman had at least apparent authority to bind the campaign and that Thornburgh’s conduct supported authorization, assent, or ratification of the fundraising arrangement.
- The court left in place the dismissal of claims against Dimuzio for lack of personal jurisdiction and treated the cross-appeal as effectively moot or unnecessary given affirmance of Thornburgh’s liability.

## Legal Principles

- FECA preemption is construed narrowly and generally does not displace state contract and agency law governing liability for campaign debts.
- Absent an express statutory rule, whether a candidate is personally liable for an unincorporated campaign committee’s contractual obligations is determined by applicable state law.
- A candidate may be personally liable where an agent with actual or apparent authority contracts for campaign services and the candidate authorizes, assents to, or ratifies the arrangement through knowledge, facilitation, or acceptance of benefits.
- Unincorporated campaign committees do not automatically provide limited liability comparable to incorporation; candidates can reduce personal exposure through incorporation and clear contractual disclaimers of personal liability.

## Conclusion

The Fifth Circuit held that federal campaign-finance law did not bar application of state contract and agency principles to impose personal liability on a federal candidate for an unincorporated campaign committee’s unpaid fundraising-services debt, and it affirmed dismissal of claims against the treasurer for lack of personal jurisdiction.


Karl Rove & Co. v. Thornburgh, 39 F.3d 1273 (5th Cir. 1994)