Lessons Learned from the Della Pello Decision

Earlier this year, a government contractor lost just over $7 million in New Jersey state government contracts because of a single political contribution that was inadvertently made payable to the WRONG political recipient. Don’t let this happen to your company:

• If an invitation for a political event gives you a choice of recipients to which you can write your check, always evaluate your options and understand the pay-to-play limits with respect to each recipient committee. Different pay-to-play restrictions apply to different types of recipients. Choose wisely …
• Always have a clear understanding of each type of recipient committee. Ask yourself – are we writing our check to a candidate, party, PAC, Super PAC or legislative leadership committee?
• Look at the check before it goes out to make sure the check is payable to the intended recipient. Ask yourself - does the name on the check match up with the name on the invitation? Is this the committee to which we want to contribute?
• Use a cover letter with each contribution. Stick to the basics - Who, What , When, Where - remember less can sometimes be more – there is no need to include a Why!
• Review your canceled checks on a regular basis to make sure your check was deposited by the intended recipient and didn’t end up in the wrong pile of checks (sometimes recipient committees share a Treasurer).
• Train relevant people within your company about the “Dos and Don’ts” of political activity compliance (although too many cooks in the kitchen can sometimes be a recipe for disaster, having more than one set of eyes involved in the process is usually helpful).
• Do not participate as a matter of routine – recipient committees will always be happy to accept your contribution after an event - contact the recipient committee if you need additional information and take your time to make an informed decision – remember – political contributions are NOT an emergency!
• And, if a mistake occurs because you did not have (or follow) the proper procedures at the time of the contribution, review the refund provisions and do everything in your power to get the check back within the correct time-frame.

For more information on how you or your company may safely participate in the political process while preserving eligibility for government contracting opportunities, please contact Rebecca Moll Freed, Esq., Chair of the Corporate Political Activity Law Group, at rfreed@genovaburns.com or 973-230-2075.