U.S. House: Reformers Call on Speaker-designee Boehner to Maintain Strong Ethics Rules & OCE Established in 110th Congress

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Today reform groups called on Speaker-designee John Boehner (R-OH) to preserve and strengthen the strong new rules adopted by the House in 2007, including the creation of the Office of Congressional Ethics (OCE).   The new rules were instituted in response to a series of high-profile scandals involving Members and their staffs and the letter stressed that the rules and the beleaguered OCE should not be weakened in any way. 

The organizations credit the OCE with helping to revitalize an ethics process that had become the object of public scorn after years of inaction.

The organizations include the Campaign Legal Center, Common Cause, CREW, Democracy 21, the League of Women Voters, Public Citizen and U.S. PIRG.

The full letter follows below.

December 21, 2010

 

House Speaker-designee John Boehner

H-204, The Capitol

Washington, DC 20515

 

Dear Speaker-designee Boehner:

Our organizations are writing to strongly urge you to support, without any weakening changes, the gift, travel and other ethics rules adopted by the House in 2007 in response to the Jack Abramoff scandals.

We are pleased to see that, according to Roll Call (December 16, 2010), Representative Greg Walden (R-Ore.) said on December 16 that "he doesn't 'anticipate any change' to the Office of Congressional Ethics in the 112th Congress, as members of the House GOP transition team concluded it will not issue recommendations about the future of the fledgling office."

As you know, our organizations strongly support the OCE, a critically important ethics reform from the last Congress and believe it is essential that the OCE continue in the next Congress with its authority, powers and funding fully intact.

We also strongly urge you to oppose any efforts to weaken or backtrack on any of the existing ethics rules and standards of conduct that have been adopted to protect the integrity of the House and the interests of the American people. We further urge you to seek ways to strengthen the existing ethics rules and standards in order to ensure that members of the House are held to the high ethical standards that citizens expect from the federal officeholders who exercise great power over their daily lives.

The organizations include the Campaign Legal Center, Common Cause, CREW, Democracy 21, the League of Women Voters, Public Citizen and U.S. PIRG.

The ethics rules adopted in 2007 included new restrictions on lobbyists and lobbying organizations paying for trips, gifts, meals and entertainment for Members, and ended the practice of Members paying cut-rate amounts to use corporate planes for their travel. 

These rules also established pre-approval requirements for trips financed by persons other than lobbyists and lobbying organizations and timely disclosure of these trips after they occur. This is an area where the rules and oversight apparently need to be strengthened, in the wake of the Caribbean trip that was the subject of a House Ethics Committee investigation based on the recommendation of the Office of Congressional Ethics.

Another important rule adopted in 2007 prohibited House members from participating in events held at the presidential nominating conventions to "honor Members" and financed by lobbyists or by private entities that retain or employ a lobbyist.

This rule was adopted to stop the abuses that had occurred at national conventions where lavish parties paid for by lobbyists and lobbying organizations were, in essence, parties thrown by House members and financed by influence-seekers.

In December 2007, the House Ethics Committee issued a guidance to House members that opened gaping loopholes in this rule.  In a letter sent on December 18, 2007 to the Ethics Committee, reform groups stated:

"The Committee's guidance, issued on December 11, 2007, provides a clear roadmap for Members and lobbyists on how to circumvent and ignore the new rule at the party conventions next year. The door is opened wide by the Committee for lobbyists and lobbying organizations to continue their past practices at conventions of sponsoring and paying for lavish parties to "honor" Members - abusive practices that led to the adoption of the new rule."

With the presidential nominating conventions coming in 2012, we urge you to provide the leadership necessary to overturn this unjustifiable guidance and restore the "convention parties" rule to its original meaning.

In conclusion, we urge you to take all steps necessary to preserve and, where necessary, strengthen the House ethics rules and standards of conduct that exist to protect the interests of the American people in an honest and ethical House of Representatives.

Campaign Legal Center                      League of Women Voters

Common Cause                                   Public Citizen

CREW                                                     U.S. PIRG

Democracy 21

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Ethics

Victory in North Carolina Voting Rights Act Case

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Earlier today, a federal judge in Washington, DC, dismissed a lawsuit filed by a group of private citizens challenging the Voting Rights Act in Laroque v. Holder.  The Legal Center’s Executive Director J. Gerald Hebert said of the decision: “The court today got it exactly right in granting the motions to dismiss.  That the plaintiffs lacked standing to sue was never in doubt.”

Hebert served as co-counsel to a group of intervenors in the case, including the North Carolina NAACP.  Also serving as co-counsel were Laughlin McDonald of the ACLU Voting Rights Project, and Anita Earls and Allison Riggs of the Southern Coalition for Social Justice. 

“This is the first of two constitutional challenges to the Voting Rights Act, hoping to find a sympathetic audience in the United States Supreme Court,” Hebert added.  “Today’s decision was an important victory in safeguarding this historic and still very pertinent piece of legislation.”

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Voting and Elections

DOJ: Dropped Investigation of Rep. Jerry Lewis Just Latest in Long List of Disappointments from Justice Department: Statement of J. Gerald Hebert, Campaign Legal Center Executive Director

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The message being sent by the U.S. Department of Justice (DOJ), especially its Criminal Division's Public Integrity Section, seems to be that Members of Congress actually are above the law or at least most laws.  The announcement that the investigation into Representative Jerry Lewis's conduct had been dropped is just the latest in a long list of high-profile investigations that began with seemingly damning sets of allegations and ended with a whimper. 

Public faith in DOJ as a whole has been dealt a series of blows since the conviction of Senator Ted Stevens was overturned.  Since that disgraceful episode, where prosecutors engaged in misconduct so serious it prompted a contempt investigation, the section has been in full retreat from its investigations of Members of Congress.

Several years ago, it appeared that a number of trials were on the horizon for Members of Congress.  But outside of those caught literally and figuratively with cold hard cash, only congressional staffers and lobbyists have been held accountable, and even many of them appear to have gotten off scot free.   

Some of those who accepted plea bargains must be kicking themselves today as the potential prosecutions from some of the highest profile scandals since Watergate have abruptly ended.  The Public Integrity Section appears to have simply folded its tents and ceded the field.  Our democracy and public faith in its government have been severely undermined.   What makes this even more troubling is that DOJ is currently led by an experienced federal prosecutor.

Rest assured, while other offices within Justice will likely be the subject of oversight hearings, it is unlikely that the Criminal Division, which appears to give Members of Congress a free pass, will be scrutinized by Congress.  

Issues
Ethics

United States v. O'Donnell

At a Glance
Pierce O’Donnell was indicted for contributing $26,000 of his money to the Edwards for President campaign through 13 individuals—primarily employees of his law firm—with the understanding that he would either advance them funds or reimburse them after the contribution was made. In June 2010, the U.S. Court of Appeals for the Ninth Circuit reversed the district court decision and held that federal law “prohibits straw donor contributions, in which a defendant solicits others to donate to a candidate for federal office in their own names and furnishes the money for the gift either through an advance or a prearranged reimbursement.”...
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Closed
Updated
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Campaign Finance
About This Case/Action

Pierce O’Donnell was indicted for contributing $26,000 of his money to the Edwards for President campaign through 13 individuals—primarily employees of his law firm—with the understanding that he would either advance them funds or reimburse them after the contribution was made. In June 2009, a federal district court dismissed two counts of the indictment that were based on a federal law provision, finding that the provision applied only to contributions made under false names, and not to a person’s reimbursement of the contributions made by others to a political campaign. In June 2010, the U.S. Court of Appeals for the Ninth Circuit reversed the district court decision and held that federal law “prohibits straw donor contributions, in which a defendant solicits others to donate to a candidate for federal office in their own names and furnishes the money for the gift either through an advance or a prearranged reimbursement.”

 

Plaintiffs

United States

Defendant

O'Donnell

Groups from Across Political Spectrum Urge Congress to Save Office of Congressional Ethics at Capitol Hill Event: Statement of Meredith McGehee, Policy Director

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At a Capitol Hill press conference this morning a coalition of 10 groups, including the Campaign Legal Center, Judicial Watch, Taxpayers for Common Sense, National Taxpayers Union and a number of reform groups urged the incoming House leadership of the 112th Congress to continue the Office of Congressional Ethics (OCE) and to oppose any efforts to weaken or undermine the office.
Campaign Legal Center Policy Director Meredith McGehee’s statement follows below:
The Office of Congressional Ethics (OCE) has provided a brief respite for a beleaguered and dysfunctional ethics process.  It should be continued in the 112th Congress. 

Killing it, however, could be done without leaving any fingerprints.  No up-or-down vote.  No grand speeches. No fanfare.   Unless affirmatively reauthorized in the rules package adopted on the first day of the 112th Congress, the OCE could cease to exist, or it could be weakened so that it remains in name only.  Controversies over other provisions in the new rules for the 112th could steal the headlines, and OCE could be fatally wounded in silence. 

We are here today to make sure that doesn’t happen, to make sure that the public, which has voted angrily for change in Washington for three straight elections, is made aware of any effort to do away with or curb the office and to make sure it doesn’t happen.

Fears of this potential outcome are not theoretical.  Rather, they are based on the House Republican leadership’s virulent opposition to the OCE when it was created, and news reports that the new Speaker may appoint a task force to decide OCE’s future. 

The fact is OCE has significantly improved the House ethics process, injecting greater professionalism and independence into the process.  The ethics committee has repeatedly shown that it is not up to the task of guarding the public trust.  If the OCE is disbanded, the committee will retreat once again behind closed doors without transparency or accountability.

Speaker-designate Boehner should stand up to those in both parties who don’t like the OCE and who want to keep the “Members-only club of Congress” closed tight.  That path would be a disservice to an institution and further damage the low public credibility of the House.

Any effort to eliminate or weaken OCE should be seen as a step backward for ethics enforcement and a slap in the face to many voters who sent a message for greater transparency and more accountability for their elected officials.

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Ethics

Oklahoma: CLC Refutes Anti-Disclosure Group Misinformation Pushed on State Officials Urging Unnecessary Repeals of Laws

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In Oklahoma this week the Campaign Legal Center stepped in to refute gross mischaracterizations of campaign finance law being leveraged by an anti-disclosure group in urging the repeal of a number of existing state political committee disclosure laws in the wake of recent court decisions.

On October 29, the Legal Center sent a letter to the Oklahoma Ethics Commission refuting a number of baseless interpretations of current law by the Institute for Justice (IFJ) in its contacts with the state claiming that several of its current laws were no longer valid in the wake of the U.S. Supreme Court’s Citizens Uniteddecision and a federal appeals court decision in SpeechNow.  The IFJ incorrectly claimed that Oklahoma laws requiring political committees to register with the state and file detailed disclosure reports would leave state defenseless in the face of inevitable lawsuits.  Of the numerous claims made by the IFJ, the only valid one concerned the state’s contribution limit for political organizations that only make independent expenditures.

The full letter text of the letter from the Legal Center to the Oklahoma Ethics Commission follows below.

November 29, 2010

Oklahoma Ethics Commission

2300 N Lincoln Blvd.

Room B-5

Oklahoma City, OK 73105-4812

 

Dear Commissioners,

It has come to our attention that Oklahoma Ethics Commission staff received a letter, dated October 18, 2010, from the Institute for Justice (hereinafter “Institute Letter”), purporting to explain recent federal court decisions and urging the Commission to “eliminate not only financing restrictions, but also burdensome PAC requirements” existing in Oklahoma law.  See Institute Letter at 3.  The “financing restriction” referred to is Oklahoma’s $5,000 calendar year limit on contributions to political committees (a.k.a. “PACs”).  See Okla. Stat. tit. 74, § 257:10-1-2(a)(1).  The allegedly “burdensome PAC requirements” referred to by the Institute are registration and disclosure requirements.  See, e.g., Okla. Stat. tit. 74, §§ 257:1-1-2, 257:10-1-11(a), 257:10-1-12(l), and 257:10-1-14.

Although the Institute accurately represents the state of federal law with respect to limits on contributions to political organizations that only make independent expenditures (hereinafter “IE-only groups”),[1] the Institute grossly mischaracterizes the current state of the law with respect to disclosure.  We are writing, therefore, to urge the Commission to disregard the Institute’s advice regarding Oklahoma’s disclosure requirements and to stand firm in its enforcement of existing disclosure laws.

The Institute cites two court decisions as the bases for its assertions that Oklahoma should repeal both its contribution limit applicable to IE-only groups and its requirements that such groups register and file disclosure reports as PACs—Citizens United v. Federal Election Commission, 130 S. Ct. 876 (2010), andSpeechNow v. Federal Election Commission, 599 F.3d 686 (D.C. Cir. 2010).

Citizens United

With respect to Citizens United, we stress two points.  First, the Court did not even consider the constitutionality of, much less invalidate, PAC registration and disclosure laws.  Second, to the extent the Court did opine on campaign finance disclosure, eight of the Court’s nine justices broadly extolled its virtues.

In Citizens United, the Supreme Court struck down as violative of the First Amendment the federal law banning corporations from making independent expenditures and electioneering communications using treasury funds, but the Court upheld federal law electioneering communication disclosure requirements in a section of the opinion joined by eight of the Court’s nine justices.

Importantly, the Court had no reason or opportunity to strike down any federal law PAC provisions because the plaintiff Citizens United did not challenge any federal laws applicable to PACs.  Citizens United had no reason to challenge federal law PAC requirements because the plaintiff corporation Citizens United is not a PAC under federal law.[2]  Like Oklahoma law, which only requires PAC registration by a group with the “primary purpose” of supporting or opposing state candidates or ballot measures, federal law only requires a group of persons to register as a PAC if that group has the major purpose of influencing federal elections.[3]  Citizens United, a 501(c)(4) tax exempt corporation, is prohibited by federal tax law from intervening in candidate elections as its primary activity.  As such, Citizens United had no standing to challenge federal law PAC requirements.

To be certain, the Court in Citizens United did discuss federal law PAC requirements, but did so in the context of rejecting a defense argument by the federal government, not in the context of considering a (nonexistent) legal challenge to federal PAC laws.  In defending the ban on corporate political expenditures, the government argued that the ban was constitutional because a corporation could voluntarily set up a PAC if it wanted to make political expenditures.  The Court explained: “Section 441b is a ban on corporate speech notwithstanding the fact that a PAC created by a corporation can still speak.  A PAC is a separate association from the corporation.  So the PAC exemption from § 441b’s expenditure ban, § 441b(b)(2), does not allow corporations to speak.” Citizens United, 130 S. Ct. at 897 (internal citation omitted) (citing See McConnell,540 U.S. 93, 330-333 (2003) (opinion of Kennedy, J.)).

Under no reasonable reading of the Citizens United decision can the Court be said to have struck down federal law disclosure requirements applicable to PACs.  The Institute’s claim to the contrary is nonsense.

The Court in Citizens United did consider, and upheld against constitutional challenge by an 8-to-1 majority, the federal law requirement that certain broadcast ads clearly identifying a federal candidate in close proximity to an election be disclosed (i.e., “electioneering communication” disclosure).  In addition to specifically upholding the challenged disclosure law, the Court praised generally the increased effectiveness of campaign finance disclosure in the Internet age.  The Court explained:

Shareholder objections raised through the procedures of corporate democracy can be more effective today because modern technology makes disclosures rapid and informative.  A campaign finance system that pairs corporate independent expenditures with effective disclosure has not existed before today.  It must be noted, furthermore, that many of Congress’ findings in passing BCRA were premised on a system without adequate disclosure.  With the advent of the Internet, prompt disclosure of expenditures can provide shareholders and citizens with the information needed to hold corporations and elected officials accountable for their positions and supporters.  . . .  The First Amendment protects political speech; and disclosure permits citizens and shareholders to react to the speech of corporate entities in a proper way.  This transparency enables the electorate to make informed decisions and give proper weight to different speakers and messages.

Citizens United, 130 S. Ct. at 916 (internal citations omitted).

The Supreme Court made clear in Citizens United that effective campaign finance disclosure is vital to democracy and the maintenance of a well-informed electorate.  We urge you to disregard the Institute’s mischaracterization of theCitizens United decision and to continue enforcing Oklahoma’s disclosure laws.

SpeechNow 

With respect to SpeechNow, a case decided two months after Citizens United, we stress two points.  First, the D.C. Circuit did apply the reasoning of Citizens Unitedand concluded that, because independent expenditures do not give rise to corruption, contributions to IE-only groups do not give rise to corruption and cannot constitutionally be limited.  Second, the D.C. Circuit explicitly considered and rejected the Institute’s challenge, on behalf of its client SpeechNow, to federal law PAC registration and disclosure laws—a challenge virtually identical to the argument the Institute now makes to this Commission in urging the repeal of Oklahoma PAC disclosure laws.

Steve Simpson argued the SpeechNow case before the D.C. Circuit, signed the Institute’s letter to you, and cited the SpeechNow decision in his letter to you.  Given these facts, it is nothing less than outrageous that his letter failed to mention that the D.C. Circuit, sitting en banc, flatly rejected his assertion that “the rule that emerges from Citizens United is that narrow disclosure provisions are constitutional for groups that make independent expenditures, but PAC requirements are not.”  Institute Letter at 4.

As the D.C. Circuit explained in SpeechNow:

On November 19, 2007, SpeechNow filed with the FEC a request for an advisory opinion, asking whether it must register as a political committee and if donations to SpeechNow qualify as “contributions” limited by [federal law].  At the time, the FEC did not have enough commissioners to issue an opinion, but it did issue a draft advisory opinion stating that SpeechNow would be a political committee and contributions to it would be subject to the political committee contribution limits.  Believing that subjecting SpeechNow to all the restrictions imposed on political committees would be unconstitutional, SpeechNow . . . filed a complaint in the district court requesting declaratory relief against the FEC . . . .

SpeechNow, 599 F.3d at 690.

The D.C. Circuit further explained:

[I]f the FEC regulates SpeechNow as a political committee, SpeechNow would be required to, among other things: appoint a treasurer; maintain a separately designated bank account; keep records for three years that include the name and address of any person who makes a contribution in excess of $50; keep records for three years that include the date, amount, and purpose of any disbursement and the name and address of the recipient; register with the FEC within ten days of becoming a political committee; file with the FEC quarterly or monthly reports during the calendar year of a general election detailing cash on hand, total contributions, the identification of each person who contributes an annual aggregate amount of more than $200, independent expenditures, donations to other political committees, any other disbursements, and any outstanding debts or obligations; file a pre-election report and a post-election report detailing the same; file semiannual or monthly reports with the same information during years without a general election; and file a written statement in order to terminate the committee.

SpeechNow, 599 F.3d at 691-92 (internal citations omitted).

The D.C. Circuit first considered and agreed with SpeechNow’s claim that, as an IE-only group, it could not constitutionally be subject to contribution limits.  The court explained: “Given [the] analysis from Citizens United, we must conclude that the government has no anti-corruption interest in limiting contributions to an independent expenditure group such as SpeechNow.”  SpeechNow, 599 F.3d at 695.

The court then moved on to SpeechNow’s claim that the federal PAC registration and disclosure requirements outlined above—similar to those in Oklahoma—are unconstitutional as applied to IE-only groups.  The court summarized SpeechNow’s position, remarkably similar to the Institute’s position before this Commission, and then rejected it.

Plaintiffs do not disagree that the government may constitutionally impose reporting requirements, and SpeechNow intends to comply with the disclosure requirements that would apply even if it were not a political committee.  See 2 U.S.C. § 434(c) (reporting requirements for individuals or groups that are not political committees that make independent expenditures); § 441d (disclaimer requirements for independent expenditures and electioneering communications).  Instead, plaintiffs argue that the additional burden that would be imposed on SpeechNow if it were required to comply with the organizational and reporting requirements applicable to political committees is too much for the First Amendment to bear.  We disagree

SpeechNow, 599 F.3d at 697 (emphasis added) 

We cannot hold that the organizational and reporting requirements are unconstitutional.  If SpeechNow were not a political committee, it would not have to report contributions made exclusively for administrative expenses.  But the public has an interest in knowing who is speaking about a candidate and who is funding that speech, no matter whether the contributions were made towards administrative expenses or independent expenditures.  Further, requiring disclosure of such information deters and helps expose violations of other campaign finance restrictions, such as those barring contributions from foreign corporations or individuals.  These are sufficiently important governmental interests to justify requiring SpeechNow to organize and report to the FEC as a political committee.

SpeechNow, 599 F.3d at 698 (internal citation omitted). 

Conclusion

The Supreme Court’s decision in Citizens United, and the D.C. Circuit’s decision two months later in SpeechNow, are consistent with the Supreme Court’s approach in recent years to questions involving elections and the First Amendment—skepticism with respect to campaign finance restrictions and wholehearted embrace of disclosure.

Again, the majority in Citizens United wrote: “The First Amendment protects political speech; and disclosure permits citizens and shareholders to react to the speech of corporate entities in a proper way.  This transparency enables the electorate to make informed decisions and give proper weight to different speakers and messages.”  Citizens United, 130 S. Ct. at 916.  And take, for example, the following passage from the concurring opinion of Justice Scalia in another recent 8-1 election disclosure decision, Doe v. Reed, 130 S. Ct. 2811 (2010).  In Doe, the Court rejected a challenge to a Washington state law that discloses to the public identifying information of individuals who sign referenda petitions.  Justice Scalia scathingly denounced anonymous political activity, writing:

Requiring people to stand up in public for their political acts fosters civic courage, without which democracy is doomed.  For my part, I do not look forward to a society which, thanks to the Supreme Court, campaigns anonymously and even exercises the direct democracy of initiative and referendum hidden from public scrutiny and protected from the accountability of criticism.  This does not resemble the Home of the Brave.

Doe, 130 S. Ct. at 2836-37 (Scalia, J. concurring) (internal citations omitted).

So, with respect to Oklahoma’s limit on contributions to IE-only groups, though the D.C. Circuit decision in SpeechNow is not binding on Oklahoma and the Tenth Circuit, it is difficult imagining the Tenth Circuit ruling differently on this issue given the Citizens United Court’s declaration that independent expenditures do not give rise to corruption.  For this reason, we recommend the state concede that its contribution limit may not constitutionally be applied to IE-only groups.

However, contrary to the Institute’s statements, the Supreme Court in Citizens United did not strike down any PAC requirements and the D.C. Circuit inSpeechNow explicitly upheld PAC requirements as applied to IE-only groups.[4]  We therefore urge the Commission to disregard the Institute’s advice regarding Oklahoma’s disclosure requirements and to stand firm in its enforcement of existing disclosure laws.

 

Sincerely,

 

/s/ J. Gerald Hebert

J. Gerald Hebert

Executive Director & Director of Litigation

The Campaign Legal Center

 

Paul S. Ryan

FEC Program Director & Associate Legal Counsel

The Campaign Legal Center

 

Tara Malloy

Associate Legal Counsel

The Campaign Legal Center

 

[1] I.e., organizations that do not coordinate with or make contributions to candidates or political parties.

[2] The plaintiff corporation Citizens United did voluntarily form a federal PAC in 1994 (FEC Committee I.D. # C00295527) in order to raise and spend individual contributions to influence federal elections, but brought its lawsuit that led to this year’s Supreme Court decision precisely because it did not want to use its PAC to pay for the political communications at issue in the suit.  And, as the Citizens United Court explained, “[a] PAC is a separate association from the corporation.” Citizens United, 130 S. Ct. at 897.

[3] See, e.g., Federal Election Commission, Political Committee Status, Supplemental Explanation and Justification, 72 Fed. Reg. 5595 (Feb. 7, 2007) (explaining the FEC’s process for determining whether an organization is a “political committee” under federal law, including an explanation of the “major purpose” requirement).

[4] One other point worth mentioning is that even if Citizens United had challenged PAC reporting requirements—which, again, it did not—Oklahoma law and its application would be distinguishable.  Oklahoma PAC registration and reporting requirement applies only to groups with the “primary purpose” of supporting or opposing candidates.  Citizens United is a 501(c)(4) organization that does not have the “primary purpose” of influencing candidate elections.  Consequently, anything the Court would have said with respect to the “non-primary-purpose” group Citizens United would be irrelevant to the “primary purpose” groups covered by Oklahoma statute.

 
Issues
Campaign Finance
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