Inside the Board of Ethics’ case against the super PAC supporting mayoral candidate Jeff Brown

At 6 p.m. on a temperate Tuesday last September, a group of wealthy donors sat down for dinner at Center City’s swanky Steak 48, known for its aged cuts and high-grade Australian and Japanese Wagyu beef.

Each attendee had been asked to pledge at least $100,000 to an organization called For A Better Philadelphia, a political group that has raised more than $3 million to try to elect Jeff Brown as mayor of Philadelphia.

Brown, a longtime ShopRite proprietor who had not yet entered the mayor’s race, had been intimately involved in inviting the donors and planning the event, which was billed as a “Roundtable Dinner & Discussion with Jeff Brown.”

Two months later, Brown launched his campaign and cut ties with For A Better Philadelphia because, as a super PAC, it is legally prohibited from working with the candidate it supports.

» READ MORE: The Philadelphia Board of Ethics is accusing mayoral candidate Jeff Brown of illegally coordinating with a super PAC

The Philadelphia Board of Ethics is now accusing the group and a related nonprofit with the same name of an “extensive and elaborate scheme to circumvent the city’s campaign contribution limits” by coordinating with Brown when he helped the groups raise funds that would later be spent boosting his candidacy. The board revealed that more than $1 million of those funds came from Brown’s Super Stores, the parent company of Brown’s stores, now owned primarily by Brown’s son.

In an emergency proceeding two weeks ago, Common Pleas Court Judge Joshua Roberts issued a temporary order prohibiting the super PAC and nonprofit from spending any more money to influence the outcome of the May 16 primary. Roberts has scheduled a hearing on Monday afternoon to decide whether to make the injunction permanent.

But over the weekend, the ethics board and For A Better Philadelphia reached a limited agreement on the injunction that would largely continue the terms of Roberts’ temporary order through Election Day. The judge has not yet seen the agreement, which he must approve. The super PAC shared news of it with The Inquirer on Saturday.

The heart of the case — whether Brown illegally coordinated with the super PAC — is likely to be decided in the following weeks, and a final resolution may not come until after the primary. Because Brown has admitted that he was involved in fundraising for the super PAC and nonprofit, the key issue is the fact that he was not yet a candidate when he raised that money.

The ethics board contends that when Brown became a candidate is irrelevant, pointing to a 2018 opinion issued by the board that said illegal coordination can occur at any point in the year leading up to an election, even if it happens before the candidate enters the race.

For A Better Philadelphia’s attorney, Matthew White, said that the 2018 opinion does not carry the force of law and that the group could not have illegally coordinated with Brown’s campaign given that the campaign did not yet exist.

“The advisory opinion is of no effect,” White said. “If you are trying to say that somebody’s behavior as a private citizen is legal [but] becomes illegal simply because they later become a candidate, it’s unconstitutional.”

White added that even if Roberts decides that Brown’s actions before he was a candidate could constitute coordination, For A Better Philadelphia will argue that the board has “overstated” Brown’s role with the super PAC and that it fell well short of coordination.

“He came to a dinner, and he may have made some calls, but we definitely disagree with the nature and the extent of what they’re saying,” White said. “They filed papers that have a lot of innuendo but very little proof.”

» READ MORE: Jeff Brown could be Philly’s first outsider mayor in a century. Can a grocer run the city?

Brown, a first-time candidate, is one of five top contenders for the all-important Democratic nomination. His success has been thanks in no small part to the more than $3 million that the For A Better Philadelphia super PAC has raised, funding TV ads, fliers, and canvassing efforts boosting Brown.

Neither Brown nor his campaign is a defendant in the case, but they could be roped into a later phase of the legal proceedings. He has called the board’s investigation into the super PAC’s activities “a political hit job” aimed at keeping a City Hall outsider from winning the mayor’s race.

“We’ve complied with the law and strongly reject the allegation that there was any wrongdoing,” Brown campaign spokesperson Kyle Anderson said.

Brown declined to comment on the donations from Brown’s Super Stores. When he launched his campaign in November, Brown said he owned only a 5% stake in the business after selling much of it to his son in the two years leading up to his run.

The legal issues at play in the ethics board’s case are complicated.

The board has alleged that because Brown coordinated with For A Better Philadelphia, the super PAC is not independent from Brown’s campaign. Consequently, any spending by the super PAC or its related nonprofit to benefit Brown should be treated as an in-kind contribution to his campaign.

The problem with that? Philadelphia places limits on the size of donations that candidates can collect, and the super PAC’s spending would be well in excess of those constraints.

For this year’s mayor’s race, the limits are currently $6,200 per year for individuals and $25,200 per year for political groups. In the board’s view, the millions that For A Better Philadelphia has spent backing Brown should be considered in-kind contributions to his campaign that were paid for with donations well over those limits.

The ethics board’s regulations state that super PAC spending is considered to be in coordination with a candidate’s campaign if the campaign or candidate “has solicited funds for or directed funds to the person making the expenditure, but only if the solicitation occurred within the 12 months before the election that the expenditure seeks to influence.”

The board’s 2018 opinion makes clear that it believes coordination between a candidate and super PAC can occur even before that person launches their campaign.

“Whether coordination occurs before or after an individual becomes a candidate is immaterial,” the 2018 opinion says. “The key issue is whether coordination between the Entity and the candidate’s campaign, which includes the candidate, occurred at all prior to the expenditures being made by the Entity.”

In past cases dealing with excess contributions, the board has required campaigns to donate the illegally contributed funds to the city’s general fund. That could be catastrophic for Brown’s campaign, which would potentially owe millions. But that potential outcome would not likely come into play before the primary.

While the crux of the case is whether Brown coordinated with For A Better Philadelphia, Monday’s hearing is also likely to feature discussion of a more time-sensitive question.

The nonprofit arm of For A Better Philadelphia has continued to circulate fliers to voters even after the judge two weeks ago ordered it to stop spending money to influence the primary.

The fliers do not mention Brown or any other candidate, but some mimic his campaign’s antiestablishment message and use the campaign’s color, orange. One flier, for instance, criticizes “elected officials who made our city dangerous and dirty” without mentioning that Brown is the only major mayoral candidate who has never held elected office.

» READ MORE: Voters are still getting mailers from an outside group boosting Jeff Brown for mayor despite a judge’s order

The nonprofit contends that the fliers are not subject to the order because they are part of a general get-out-the-vote effort and not an effort to boost Brown.

“Orange is just a color that pops,” White said, noting that other candidates, including former Councilmembers Allan Domb and Cherelle Parker, are using orange for their campaigns as well. “Before this election cycle, I’ve never seen orange [in campaigns]. Now I’m seeing it all over the place.”

Preventing the nonprofit from spending money to encourage people to vote would be unconstitutional, he said.

“The [nonprofit] believes that it is entitled to have its constitutional right to make neutral, civically directed encouraging speech for people to go vote,” White said. “If you had the government coming in saying, ‘We want to vet everything that happens before you go,’ that’s like the Taliban.”

David Maser, an attorney who chairs both the super PAC and the nonprofit, said in an affidavit filed Friday that the fliers are meant “to encourage and empower historically disenfranchised Black and Brown citizens to participate in Philadelphia’s elections,” which he said is the mission of the For A Better Philadelphia nonprofit, which was created in 2021.

It will be up to Roberts to determine whether the nonprofit’s continued voter outreach is in violation of his order.

The tentative agreement that the super PAC reached over the weekend with the ethics board would involve periodic check-ins with the judge to ensure that its efforts to increase voter turnout do not include communications that would influence the outcome of the mayor’s race.

The only physical manifestation of For A Better Philadelphia appears to be a mailbox at a UPS store in Queen Village that is blocks away from Maser’s home.

As a “dark money” group, it has kept many of its donors secret by routing almost $3 million through its nonprofit arm. It’s the first group to play a major role in a Philadelphia mayoral election without disclosing donors.

Maser, a lawyer with the Cohen Milstein Sellers & Toll firm who did not respond to requests for comment, was involved in the only other notable instance of dark money playing a role in Philadelphia politics.

Philadelphia 3.0, an outside spending group that influences City Council races, has a similar structure to For A Better Philadelphia, with separate but related super PAC and nonprofit arms, and was also organized in part by Maser.

The anonymity of For A Better Philadelphia’s donors is not a focus of the board’s case against the group, but it has raised concerns from ethics experts about potential conflicts of interest going undetected if Brown becomes mayor.

» READ MORE: Philadelphia has never had a ‘dark money’ group play a big role in a mayor’s race. Until now.

In its initial filing, the ethics board, for instance, revealed that a professional sports team has contributed to the nonprofit. The team appears to be the 76ers, which is seeking city approvals necessary for its controversial proposal to build an arena in Center City. Among the mayoral candidates, Brown is one of the most supportive of the plan.

Had the board not put a spotlight on that donation, voters may never have known that the 76ers may be supporting Brown’s candidacy. They still don’t know the identities of the other moneyed interests backing him.

Brown has said publicly that he does not know who gave to For A Better Philadelphia, a curious statement given that he personally solicited many of the donations and that Brown’s Super Stores appears to be the largest contributor.

» READ MORE: Philly officials say a pro sports team paid big to boost Jeff Brown for mayor. The Sixers have ties to that super PAC.

Patrick Christmas, policy director for the good government group Committee of Seventy, said that while the public may never know who backs dark money groups, the candidates almost certainly do.

“The voters will never know where the big checks came from, but their elected official will,” Christmas said.

And in Brown’s case, there may be very little mystery.

In August of last year, Olivia Scanlon, who was a fundraising consultant for the super PAC and is now Brown’s deputy campaign manager, emailed Brown and Maser in advance of the fundraising dinner at Steak 48 to discuss whether to share the guest list and fundraising information with a donor, according to evidence submitted by the board.

“Let me know if you want to include or remove before I send to” the donor, whose named was redacted, Scanlon wrote.

Maser replied, “I think it’s fine, a little transparency is a good thing.”

Correction: An earlier version of this story inaccurately stated that For A Better Philadelphia shared with The Inquirer its tentative agreement with the Philadelphia Board of Ethics. The group shared news of the agreement with the newspaper, not the agreement itself.