Today, the Campaign Legal Center filed an amicus brief in Texas Democratic Party, et al. v. King Street Patriots, et al. to defend the constitutionality of Texas’s campaign finance laws. 

The Texas Democratic Party  filed an action seeking damages and declaratory and injunctive relief in connection to several violations of state campaign finance laws allegedly committed by the King Street Patriots.  The Texas Democratic Party alleges that the King Street Patriots, a non-profit 501(c)(4) corporation, made in-kind contributions to the state Republican Party in violation of Texas’s restriction on corporate political contributions, and failed to register as a “political committee” and comply with state disclosure law.  In response to the suit, the King Street Patriots filed a counterclaim challenging numerous provisions of Texas campaign finance law, including the state restriction on corporate contributions to candidates, officeholders and political committees, and the disclosure and organizational requirements applicable to political committees.

“This is just one case in an aggressive nationwide litigation offensive seeking to invalidate a broad swath of state campaign finance laws in the wake of Citizens United,” said Legal Center Counsel Tara Malloy.  “But Citizen United simply does not support the radical result the King Street Patriots and other anti-reform litigants seek.  The Supreme Court did not consider a corporate contribution restriction in Citizen United, and eight of the nine Justices actually strongly endorsed disclosure in that opinion.  We hope the district court affirms the constitutionality of Texas’s law, as it should.” 

The Legal Center was supported in the case by the law firm of Gray and Becker in Austin, Texas.

Both parties have filed cross-motions for summary judgment on the King Street Patriots’s counterclaim.  The motions will be heard by the District Court of Travis County, Texas on November 8, 2011.

To read the Legal Center’s amicus brief opposing the King Street Patriots’s counterclaim, click here.

Today reform groups asked Sen. Richard Durbin (D-IL), Chairman of the Senate Appropriations Subcommittee on Financial Services and General Government, to fight efforts to terminate or defund the presidential public financing system.  The letter praised Sen. Durbin’s leadership on public financing issues and asked that he continue to guard against efforts to do away with the system like those already introduced this year or that will likely come up going forward in the appropriations process.

The letter cites legislation introduced in the Senate as well as two measures already passed in the House that would end the longstanding and highly successful program that was created in the wake of the scandals the engulfed the Nixon Administration in the Watergate era.

The organizations signing the letter include the Campaign Legal Center, Americans for Campaign Reform, Brennan Center for Justice, Common Cause, Citizens for Responsibility and Ethics in Washington, Democracy 21, League of Women Voters, People For the American Way, Public Citizen and U.S. PIRG.
 

The full letter follows below.

September 12, 2011

The Honorable Richard Durbin, Chairman
Senate Appropriations Subcommittee on Financial Services and General Government
U.S. Senate
Washington, D.C. 20510

Dear Chairman Durbin:

Our organizations support public financing of elections and greatly appreciate the outstanding national leadership you have provided on behalf of this essential reform.

The organizations include Americans for Campaign Reform, Brennan Center for Justice, Campaign Legal Center, Common Cause, Citizens for Responsibility and Ethics in Washington, Democracy 21, League of Women Voters, People For the American Way, Public Citizen and U.S. PIRG.

We are writing to ask for your help and leadership in blocking any efforts made in Congress to repeal and kill the presidential public financing system.

As Chairman of the Senate Appropriations Subcommittee on Financial Services and General Government, this matter could come before you when your subcommittee or the full Senate Appropriations Committee considers the FY 2012 appropriations for the Treasury Department and/or the Federal Election Commission.

House Republicans already have twice passed legislation in this Congress to end the presidential public financing system.  

On January 26, 2011, they passed a free standing bill to kill the presidential public financing system.  On February 17, 2011, they passed an amendment to H.R. 1, the FY 2011 spending bill, offered by Representative Tom Cole (R-OK), to prohibit any funds from being used to implement the presidential public financing system. H.R. 1 passed the House on February 19, 2011.

On January 26, 2011, Senate Republican Leader Mitch McConnell also introduced legislation to kill the presidential public financing system, similar to the Cole legislation passed on that day by the House.

Congressional opponents may try again to kill the presidential system by attaching a rider to the Appropriations legislation for FY 2012 that funds the Treasury Department and the Federal Election Commission when the legislation is considered in Committee or on the floor in the House or Senate. Or opponents may try to attach a rider to kill the presidential system to the Continuing Resolution for FY 2012 that Congress is expected to pass.

This effort is not just intended to kill the presidential system. It also represents a full scale attack on the very concept of public financing and an effort to get Congress on record in opposition to public financing of elections.

It is essential to the long term goal of repairing the presidential public financing system and to the effort you are leading in Congress to establish a system for congressional public financing that the effort to kill presidential public financing be defeated.

The presidential public financing system served the nation and presidential candidates of both major parties well for most of its 36-year existence, until it became outdated in recent years. The system has protected against government corruption and has given average citizens and small donors a vital role to play in our presidential elections.

The presidential system today needs to be repaired, not repealed.  As the Obama Administration stated in opposition to the Cole legislation to repeal the presidential system:

The Administration strongly opposes House passage of H.R. 359 because it is critical that the Nation's Presidential election public financing system be fixed rather than dismantled.

……..

After a year in which the Citizens United decision rolled back a century of law to allow corporate interests to spend vast sums in the Nation's elections and to do so without disclosing the true interests behind them, this is not the time to further empower the special interests or to obstruct the work of reform.

As the national leader for public financing of congressional elections and as Chairman of the relevant Appropriations Subcommittee, you are in a unique position to lead the effort in Congress to prevent congressional opponents from repealing the presidential public financing system.

We would greatly appreciate your leadership in Congress to ensure that the presidential public financing system is not killed. We also would like to again express our great appreciation for your outstanding leadership on behalf of congressional public financing.

Americans for Campaign Reform         Democracy 21
Brennan Center for Justice                    League of Women Voters
Campaign Legal Center                        People For the American Way
Common Cause                                     Public Citizen
Citizens for Responsibility and              U.S. PIRG
Ethics in Washington

Today reform groups urged a House Judiciary subcommittee to hold hearings on the “Clean Up Government Act of 2011” (H.R. 2572), legislation that would provide critically needed amendments to the federal criminal statutes to hold public officials accountable for a broad range of corrupt practices.  The letter to the Chair and Ranking Member of the Subcommittee on Crime, Terrorism, and Homeland Security emphasizes the critical need for updates to these statutes in the wake of a series of court decisions that have drastically undermined prosecutors’ ability to address a broad swath of public corruption.

H.R. 2572, the letter stresses, will allow prosecutors to “hold accountable public officials who secretly act in their own financial self-interest, rather than in the interest of the public.”

The organizations signing the letter include the Campaign Legal Center, Citizens for Responsibility and Ethics in Washington (CREW), Democracy 21, Public Citizen, Project on Government Oversight (POGO) and U.S. PIRG.

 The full letter follows below.

September 7, 2011

 Re:      H.R. 2572, the “Clean Up Government Act of 2011”

Sent Via Fax

 Dear Reps. Sensenbrenner and Scott:

Today our organizations write to strongly endorse and call for swift committee consideration and passage of the “Clean Up Government Act of 2011” (H.R. 2572), legislation that would provide critically needed amendments to the federal criminal statutes.

As you are well aware, last year’s Supreme Court decision in Skilling v. United States eviscerated an entire category of deceptive, fraudulent and corrupt conduct from the scope of what was known as the honest services fraud statute (18 U.S.C. § 1346).  For decades government attorneys have used § 1346 to prosecute public officials who engage in malfeasance, such as undisclosed self-dealing, that is not as simple as a direct quid pro quo or a freezer full of money.  Unfortunately, the Skilling decision effectively struck down as unconstitutionally vague the honest services language and consequently, there is now a gaping hole in the Department of Justice’s (DOJ) ability to address a vast swath of public corruption.

H.R. 2572 is constitutionally sound and heeds the Supreme Court’s directive for more clarity and specificity.  The “Clean Up Government Act” directly and effectively addresses concerns raised about previous versions regarding over overcriminalization and prosecutorial abuse because of vagueness and lack of clarity.  The bill borrows existing language from 18 U.S.C. § 208, a well-established federal conflict-of-interest statute that already applies to the executive branch and, more importantly, has been upheld as constitutionally sound by the Supreme Court and U.S. Court of Appeals for the Fifth Circuit. Further, as DOJ correctly testified at the hearing, under the proposed statute no public official could be prosecuted unless he or she knowingly conceals, covers up, or fails to disclose material information, which the official already is already required by law or regulation to disclose, with the specific intent to defraud.  As crafted, H.R. 2572 removes the risk that a public official can be convicted for unwitting conflicts of interest or mistakes.

The legislation also overturns other misguided court decisions limiting the use of the illegal gratuities statute.  By reversing the Supreme Court’s decision in United States v. Sun-Diamond Growers, 526 U.S. 398 (1999), the bill revives the federal government’s power to criminally charge public officials who receive gifts because of their governmental positions with accepting illegal gratuities.  In addition, responding to United States v. Valdes, 475 F.3d 1319 (D.C. Cir. 2007), the bill makes clear government officials who accept private compensation for using the powers their jobs afford them may be subject to criminal prosecution.

We urge you to ensure that any modifications made to the bill before it is reported out of committee leave intact these critically needed legislative reforms.  Only then can we hold accountable public officials who secretly act in their own financial self-interest, rather than in the interest of the public.

Sincerely,

Today, the Campaign Legal Center, with Democracy 21, will urge the Federal Election Commission (FEC) and Department of Justice (DOJ) to investigate more possible violations of campaign finance law by companies that appear to have been utilized to hide the identity of $1 million contributors to Restore Our Future, a Super PAC operated by former Mitt Romney campaign staffers.  Today’s complaints come on the heels of a complaint filed last Friday by the Campaign Legal Center and Democracy 21 against another $1 million mystery donor to Restore Our Future, W Spann LLC.  Shortly after Friday’s filing, the true donor behind W Spann LLC came forward.

Today’s complaints to the FEC and letters to DOJ will ask the agencies to formally investigate the activities of the F8 LLC and Eli Publishing L.C. for possible violations of the ban on making contributions in the name of another and for failing to organize and register as a political committee.  The activities outlined in media reports paint a picture of companies used to hide the identities of the actual donors seeking to curry favor with a candidate running for the highest office in the land.

“The use of ‘straw companies’ to funnel money anonymously into Restore Our Future does not appear to have been limited to a single company, but seems to be a pattern that places additional urgency on the need for the FEC and DOJ to vigorously investigate these companies and to enforce the laws on the books before this problem becomes even more widespread,” said Paul S. Ryan, FEC Program Director at the Campaign Legal Center, which took the lead in drafting the FEC complaint and letter to the Justice Department.  “Existing laws must be enforced to give citizens a fighting chance of knowing who or what is spending millions of dollars in an attempt to influence their vote and to curry favor with elected officials.”

“The enforcement agencies need to send a clear message to donors that they need to put their name on the check if they’re going to be giving to Super PACs and I hope that reporters are taking a close look at filings by other Super PACs so that these types of abuses are smoked out,” said Ryan.  “The fact that Restore Our Future has been the recipient of all three mysterious $1 million contributions warrants exploration of the PAC’s knowledge of or involvement in this ‘straw company’ donation scheme.”

“There are now three $1 million donors who apparently hid their true identities from the American people when they provided huge contributions to Restore Our Future, the pro-Romney Super PAC,” according to Democracy 21 President Fred Wertheimer. “Both the secrecy and the size of the contributions to Restore our Future are extremely dangerous to the interests of the American people.  Secret and unlimited contributions in American politics invariably result in scandal and corruption. Mitt Romney needs to speak out loud and clear that he wants full transparency for all of the money being raised and spent to support his presidential campaign.”

“Mitt Romney also needs to act promptly against secrecy in his own campaign by disclosing the individual bundlers who are raising large amounts of money for his 2012 presidential campaign, as he was perfectly willing to do when he disclosed the bundlers for his 2008 presidential campaign,” Wertheimer said. “All of the 2012 presidential candidates should disclose the bundlers raising large amounts of money for them as presidential nominees Barack Obama and John McCain did in 2008, and as President Obama is doing for his 2012 presidential campaign,” according to Wertheimer.

To read the FEC complaints, click here and here.  To read the letters to the Department of Justice, click here and here.

The American Bar Association’s (ABA) House of Delegates yesterday passed a resolution urging the Congress to amend and strengthen the Lobbying Disclosure Act (LDA).  The resolution, which passed without opposition, urges a narrowing of the reporting threshold (currently 20%), requiring disclosure of “lobbying support” activities by strategists, pollsters, and “grass tops” firms paid as part of  lobbying campaigns, prohibiting fundraising by lobbyists for Members of Congress they lobby, and transferring  authority to enforce the LDA to a suitable administrative authority.

“This resolution urges Congress to bring the Lobbying Disclosure Act into line with the sort of lobbying that occurs today,” said Legal Center President Trevor Potter, who was also a co-chair of the ABA Task Force on Lobbying Regulation.   “These are common sense solutions to restore the faith of citizens in their elected officials by bringing the business of government out into the sunlight.  It is important to emphasize that these recommendations were initially proposed by a Task Force of lawyers, academics, lobbyists, and public interest representatives with a wide range of experiences and perspectives.”  

The Task Force on Lobbying Disclosure Reform was appointed by the ABA’s Administrative Law and Regulatory Practice Section to study the issue in 2010.  The Task force was co-chaired by Campaign Legal Center President Trevor Potter (a former Chair of the FEC and General Counsel to the McCain Presidential campaign) ; Harvard Law Professor Charles Fried (who was Solicitor General of the United States under President Reagan); Rebecca Gordon of the law firm of Perkins Coie; and Joseph Sandler of the Sandler, Reiff and Young law firm (and former General Counsel of the DNC),  and included a broad spectrum of academics and practitioners, including Legal Center Policy Director Meredith McGehee.   

The Task Force Report, “Lobbying Law in the Spotlight: Challenges and Proposed Improvements,” the product of strong consensus among the diverse group, was presented to the ABA’s Administrative Law Section in August 2011. The Administrative Law and Regulatory Practice Section then proposed its Lobbying Resolution to the ABA House of Delegates, which adopted it this week after incorporating proposals to clarify it from the ABA Tax Section and Individual Rights and Responsibilities Section.  The effect of ABA approval is that the organization can now push Congress to adopt these reforms.

To read the full ABA Resolution, click here. 

To read the Task Force Report from January 2011, click here.