PHILADELPHIA — The Philadelphia Board of Ethics on Monday sued a political committee and a nonprofit supporting Jeff Brown’s bid for mayor and accused Brown of violating the city’s campaign finance law by illegally coordinating with those groups, which are supposed to operate independently from his campaign.
Citing an “extensive and elaborate scheme to circumvent the city’s campaign contribution limits,” the board asked Common Pleas Court Judge Joshua Roberts to issue an emergency order prohibiting the political group ― a super PAC called For A Better Philadelphia ― and the nonprofit, which has the same name, from spending money to influence the May 16 primary election for mayor and to cancel any planned television advertising or other efforts to support Brown’s campaign.
The board is also seeking $162,000 in fines to be paid jointly by the two groups for repeatedly violating the city’s campaign finance laws as part of the alleged scheme. That would be the largest-ever financial penalty for violations of those rules.
Matthew White, a Ballard Spahr attorney representing both groups, said in court that they would agree to an order temporarily blocking them from making new expenditures because they had already ended their efforts to influence the election. But White said the groups objected to the broader accusations in the case.
The judge then granted part of the board’s request and issued an order temporarily blocking new political expenditures by the groups. He told both sides to return April 24 for a full hearing on the matter, and he said he expects to make a final ruling at that time.
The board’s legal actions pursuing the groups backing Brown’s campaign are the first public confirmation of its investigation into campaign finance activities related to Brown, which The Inquirer first reported last month.
Brown, a ShopRite proprietor and first-time candidate running as a government outsider, is a front-runner in the crowded race for the Democratic nomination, and Monday’s events represented a significant escalation of the controversies surrounding the moneyed interests backing his mayoral bid.
Brown campaign spokesperson Kyle Anderson said in a statement that the lawsuit is “nonsense” and amounts to “a disagreement on campaign finance between the lawyers.”
”The bottom line is that Jeff is fighting for change and a new direction for Philadelphia, and that message is resonating,” he said. “We have complied with the law and neither we, nor the voters, will be distracted by this nonsense.”
At an event Monday evening, Brown was asked by a reporter if he had solicited donations for For A Better Philadelphia.
”Not when I was a candidate for mayor,” he said. “But prior to that I did.”
In a statement, For a Better Philadelphia said it looked forward to being vindicated in court.
“We think the Board of Ethics’ efforts to put its thumb on the scales of such a consequential elections should concern every resident of the City who demands better than the status quo,” the group said.
For a Better Philadelphia is an independent expenditure committee, which is a type of political group that is allowed to accept donations that are larger than the city’s contribution limits so long as it does not coordinate with a candidate. This year, the contribution limits are $6,200 for individual donors and $25,200 for organizations.
Shane Creamer, executive director for the Board of Ethics, said Brown coordinated with the groups because he “engaged in extensive fundraising” for the nonprofit arm of For A Better Philadelphia. Creamer said the board told the super PAC on March 30 to stop making expenditures while it investigated that alleged coordination.
“This, I think, arguably is the worst type of coordination, where the candidate is directing donors directly to the outside spending group and getting money to the spending group directly — in this case to a ‘dark money’ group so the public doesn’t even know it’s happening,” Creamer said.
The board is an independent city agency composed of five mayoral appointees that interprets and enforces the city’s ethics laws, including those on lobbying, political activities by city employees, and campaign finance.
The board frequently investigates campaigns or political groups that have run afoul of fundraising and reporting rules. Those cases usually end in settlement agreements in which the offending parties admit they violated the rules and pay fines.
The board, however, also has the option to seek judicial enforcement through the courts, which is the avenue it is pursing for this case. Creamer said part of the motivation to seek court intervention in this case is because multimillion-dollar super PACs can afford to pay fines while continuing to break city law.
“We wouldn’t be able to keep up with super PACs and dark money groups like For A Better Philadelphia that have millions of dollars to spend, where we’re limited to $2,000 penalties per violation,” Creamer told reporters after Monday’s hearing. “It becomes a cost of doing business for groups that have millions of dollars to spend not only on TV ads but also on fines, and then we become a mosquito bite for violators of our law.”
The board voted 4-0 to approve seeking judicial enforcement against For A Better Philadelphia. One board member abstained due to a potential conflict of interest. Creamer on Monday declined to say which member that was.
The Board of Ethics contends that Brown’s alleged coordination means the super PAC is not independent from Brown’s campaign and that spending on behalf of Brown by the super PAC or the nonprofit would therefore be an in-kind contribution to his campaign.
Those in-kind contributions would then be subject to the city’s limits on the size of campaign donations. That would mean Brown’s campaign is effectively benefiting from contributions well in excess of what the city allows.
For A Better Philadelphia is the first organization to play a role in a Philly mayor’s race while exploiting a loophole in the city’s campaign finance laws that allows super PACs to keep their backers secret by funneling its money through nonprofits.
Campaign finance reports showed that three nonprofits donated $2,975,000 to the super PAC supporting Brown last year, accounting for 96% of the PAC’s fundraising in 2022 and 2023. That included more than $2.4 million from the nonprofit arm of For A Better Philadelphia, which was registered with the Pennsylvania Department of State last year.
The rest of the “dark money” appeared to come from two established super PACs based in Washington: MAP USA and Patriot Majority USA. But Creamer said Monday that even the money that passed through those D.C.-based groups originated in the nonprofit arm of For A Better Philadelphia. It is not yet clear why the nonprofit would have passed that money through those separate groups.
The board, in the filing, said Brown served as a planner and keynote speaker for fundraising dinners, with tickets going for $100,000, held by the nonprofit in August and September. The August dinner brought in more than $1 million.
People attending the dinner were given the option of donating to the nonprofit or to the super PAC. Nine gave to the nonprofit, three to the super PAC.
The board’s filing lists an extensive string of communications about fundraising between Brown; his deputy campaign manager, Olivia Scanlon; and David Maser, an attorney who serves as chair for both the super PAC and nonprofit.
The board also said a local professional sports team that is not identified in the court filing contributed $250,000 to the nonprofit and that “an entity controlled by one of the sports team’s collaborators had already contributed $150,000″ to the nonprofit.
In addition to working on the super PAC, Maser is a consultant for the 76ers on their proposal to build an arena in Center City. He reached out in November to the Brown campaign to broker a meeting between the team, Brown, and members of the campaign. Emails obtained by the board show Maser and Jimmy Cauley, Brown’s campaign manager, scheduled a meeting for early January at Brown’s campaign headquarters.
Neither Maser nor For A Better Philadelphia responded to requests on whether the 76ers were the anonymous sports team that gave to the PAC. The Sixers also did not respond to requests for comment.
Before launching his campaign, Brown was the CEO of Brown’s Super Stores, which contributed $1.25 million to the nonprofit in three donations in January, February, and March.
Brown’s opponents in the mayor’s race attacked him Monday following the revelations and have been critical of him benefiting from anonymous donors.
“Jeff Brown is running one of the most unethical campaigns in Philadelphia history,” said Jared Leopold, a spokesperson for Allan Domb’s campaign. “It’s time for Jeff Brown to come clean to Philadelphians about who donated to his dark money organization and what promises he made behind closed doors to secret donors.”
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(Philadelphia Inquirer staff writer Beatrice Forman contributed to this article.)
