CA Bill Jabs at Musk’s $1 Million Voter Lottery

A bill aiming to criminalize election-related giveaways and lotteries in California, a direct response to Elon Musk’s political action committee during the 2024 U.S. Presidential Election, has advanced through the state Senate.

Senate Bill 398, authored by Senator Thomas J. Umberg, seeks to close a perceived loophole in election law by making it a crime to offer prizes or lotteries to induce individuals to vote or register to vote.

Currently, federal law prohibits knowingly paying or offering money or other valuable consideration to a person intending to cause them to vote or register or where payment is contingent upon their voting or voter registration status.

However, federal law does not explicitly prohibit lotteries as registration incentives at the state level. SB 398 addresses this by explicitly criminalizing the offer of a chance to win a lottery or similar prize-drawing contest for voter registration.

Under SB 398, a violation would be punishable by a fine of up to $10,000, imprisonment for 16 months, two or three years in state prison, or up to one year in county jail, or both fine and imprisonment. These penalties align with federal law provisions for similar offenses.

Senator Umberg, who chairs the Senate Judiciary Committee, stated that what Elon Musk has done and is doing “is spit in the face of our founders, longstanding campaign ethics and federal election law.”

Umberg disapproves of what he views as a “flagrant disregard for the rule of law” by “wealthy oligarchs” such as Musk. He emphasized the importance of holding such individuals accountable for attempting to “bend our institutions to their own selfish whims,” adding that such interference “would not be welcome in California.”

The impetus for SB 398 stems from the controversy surrounding Elon Musk’s “America PAC” activities during the 2024 U.S. Presidential Election. Musk, a vocal supporter of President Donald Trump, founded America PAC to aid Trump’s campaign. In October 2024, the PAC initiated a highly publicized monetary giveaway campaign.

At rallies and through online promotions, Musk’s America PAC pledged to award $1 million daily to individuals who signed an online petition. The petition supported the First and Second Amendments of the U.S. Constitution.

The offer was limited to registered voters in key swing states identified as critical to the presidential election, including Pennsylvania, Georgia, Arizona, Michigan, Wisconsin, North Carolina and Nevada. Musk also promised $100 to registered Pennsylvania voters who signed the petition and offered $47 for petition signers who successfully referred voters from other swing states.

The PAC’s stated purpose for the million-dollar recipients was for them to act as “spokespeople for the petition.” America PAC had assumed a significant role in supporting Trump’s proposition in these swing states.

The focus on free speech and gun rights, as advocated by the petition, resonated particularly with potential Trump voters, encouraging their registration and participation in the election.

However, these financial incentives quickly drew scrutiny from election law experts and public officials. Federal law explicitly prohibits compensation for voter registration or voting. Legal scholars were divided on whether Musk’s scheme violated these statutes.

Richard Hasen, an election law scholar at UCLA, suggested that Musk “may well have crossed the line,” likening the petition to past cases where offering free food for “I voted” stickers was considered an illegal inducement. David Becker from the Center for Election Innovation & Research agreed, stating that the law broadly covers “anything of value” in voting.

In contrast, former FEC chairman Bradley Smith argued that the petition was “too attenuated” from direct voter inducement to be illegal, especially since most recipients were registered voters.

The Department of Justice had issued a warning letter to Musk’s PAC, indicating that the contest might violate federal law.

Philadelphia District Attorney Larry Krasner filed a lawsuit to halt the giveaways in Pennsylvania, calling them an “illegal lottery scheme to influence voters” and “designed to actually influence a national election.”

The lottery winners signed contracts to represent the PAC at political rallies and other promotions in which they would receive the grand prize of $1 million.

Chris Young, the director and treasurer of America PAC, testified on the selection process for the giveaway and stated that winners would need to be vetted to be considered for the prize based on whether the individual aligned with the core values of the PAC.

Philadelphia Common Pleas Court Judge Angelo Foglietta initially paused Krasner’s lawsuit to allow a federal court to consider the case. However, Judge Foglietta ultimately ruled that Musk’s giveaway was not a lottery under Pennsylvania law, explaining that it failed to meet the three criteria for such a designation.

The controversy extended beyond Pennsylvania, with an Arizona woman filing a lawsuit against Musk in Texas, alleging fraud because participants were not informed that winners would be selected through a vetting process rather than randomly.

Over one million people from the seven target states registered for the sweepstakes by signing the petition. Despite the legal challenges, the contest concluded on Election Day with 18 winners.

SB 398 will move onto the Second Committee review and Second Chamber before it is enacted.

For any inquiries or further information, please contact Jose Cervantes at JoseC.Press@pm.me