Bialek v. Mukasey [formerly Bialek v. Keisler; Bialek v. Gonzales] (07-CV-00321-WYD-PAL) Marcus v. Mukasey [formerly Marcus v. Gonzales] (CV07-0398-PCT-EHC) Beam v. Gonzales (07CV1227)

Background

During February and March 2007, Barry Bialek, Jon Marcus and Jack and Renee Beam filed separate, but substantially similar complaints with district courts in Colorado, Arizona and Northern Illinois, respectively, alleging that the Commission violated the Federal Election Campaign Act (the Act) by "tacitly cooperating and conspiring with" Attorney General Alberto Gonzales to circumvent the Act.

According to the complaint filed February 14, 2007, Plaintiff Barry Bialek made contributions towards John Edwards’ 2004 Presidential campaign. In November 2005, the U.S. Attorney General began an investigation into possible violations of the Act by the plaintiff. See April 2007 Record. The plaintiff filed a complaint with the District Court in Colorado, alleging that the Commission must refer, by a vote of the majority of the Commission, a matter to the Attorney General prior to the Attorney General investigating or prosecuting a violation of the Act.

These cases are related to the Fieger v. Gonzales case currently pending in the Eastern District of Michigan, in which Geoffrey Fieger alleges that the Act grants the Commission exclusive jurisdiction over criminal violations and bars the Department of Justice from conducting any grand jury investigations unless and until the Commission makes a referral. See March 2007 Record.

Complaints

The plaintiffs made contributions to John Edwards’ 2004 presidential campaign. According to the complaints, the plaintiffs are being investigated by the Department of Justice for violations of the Act. Mr. Bialek was summoned before a grand jury in November 2006 and Mr. Marcus was summoned before a grand jury in October 2006.

The plaintiffs assert that by giving "exclusive jurisdiction" over the Act to the Commission, Congress determined that no criminal investigation can take place unless the Commission has formally referred the criminal matters to the Attorney General. The plaintiffs claim that the Attorney General’s investigations are unlawful and unconstitutional since the Commission did not refer the plaintiffs’ alleged violations to the Attorney General.

In addition to those allegations, the Beam plaintiffs allege that Attorney Gonzales intentionally interfered with the Commission’s investigation and that the Commission’s failure to conduct its own investigation violates the Act and the Administrative Procedures Act.

The Bialek and Marcus complaints seek a declaration that the defendants’ actions are unlawful and the award of costs and attorneys’ fees. In addition to this relief, the Beam complaint asks the court to declare the that the Commission has failed to uphold the Act and to issue a Writ of Mandamus requiring the Commission to conduct its own investigation into the matter prior to any investigation by the Attorney General.

Plaintiff Bialek

Background

According to the complaint filed February 14, 2007, Mr. Bialek made contributions towards John Edwards’ 2004 Presidential campaign. In November 2005, the U.S. Attorney General began an investigation into possible violations of the Act by the plaintiff. See April 2007 Record.

The plaintiff filed a complaint with the District Court in Colorado, alleging that the Commission must refer, by a vote of the majority of the Commission, a matter to the Attorney General prior to the Attorney General investigating or prosecuting a violation of the Act.

In June 2007, the District Court granted the Commission’s motion to dismiss the plaintiff’s suit with prejudice, holding that the Attorney General’s discretion over whether to investigate a potential criminal violation of the Act does not require a referral from the Commission. See August 2007 Record.

District court decision

On June 28, 2007, the U.S. District Court for the District of Colorado granted the Commission’s motion to dismiss the suit by Barry Bialek against the U.S. Attorney General and the FEC, holding that the Attorney General has discretion over whether to investigate and prosecute criminal violations of the Federal Election Campaign Act (the Act) and is not required to wait for a referral of a case from the Commission.

The District Court held that the Act does not limit the Attorney General’s authority to investigate and prosecute criminal violations of the Act and that the Commission’s actions are not a prerequisite to the Attorney General’s investigation.

Upon creating the Federal Election Commission, Congress gave the Commission exclusive jurisdiction to enforce the civil provisions of the Act. 2 U.S.C. 437c(b)(1). The Commission may refer a violation to the Attorney General if, by four votes of the Commissioners, the Commission determines that there is probable cause to believe that a "knowing and willful" violation occurred. 2 U.S.C. 437g(a)(5)(C).

The plaintiff claimed that because the Act grants the Commission exclusive jurisdiction over civil violations and contains a referral provision, criminal violations must first be handled by the Commission, and the Attorney General may only become involved in the matter once the Commission has voted to refer the violation. The court rejected the plaintiff’s argument, holding that there is a presumption against any limitation on the Attorney General’s prosecutorial authority and Congress must show "clear and unambiguous" intent to restrict the Attorney General’s authority to investigate and prosecute criminal offenses. The Act does not explicitly restrict the Attorney General in any way. The court held that nothing in the plain language of the Act required a referral prior to prosecution by the Attorney General.

Additionally, the court held that the legislative history of the Act does not show Congressional intent to limit the prosecutorial authority of the Attorney General.

The district court granted the Commission’s motion to dismiss and dismissed the case with prejudice against the plaintiff.

Appeals court decision

On June 24, 2008, the U.S. Court of Appeals for the 10th Circuit affirmed the District Court’s dismissal of plaintiff Barry Bialek’s suit against the U.S. Attorney General and the FEC, agreeing that the Attorney General has discretion over whether to investigate and prosecute criminal violations of the Federal Election Campaign Act (the Act) and is not required to wait for a referral from the Commission.

The appellate court affirmed the district court’s decision. The appellate court agreed with the district court that Congress did not expressly limit the Attorney General’s authority to investigate and prosecute criminal violations of the Act and that the Commission’s actions are not a prerequisite to the Attorney General’s investigation.

The Act provides the Commission with exclusive jurisdiction to enforce the civil provisions of the Act. 2 U.S.C. 437c(b)(1). The Commission may refer a violation to the Attorney General if, by four votes of the Commissioners, the Commission determines that there is probable cause to believe that a "knowing and willful" violation occurred. 2 U.S.C. 437g(a)(5)(C).

The plaintiff claimed that because the Act grants the Commission exclusive jurisdiction over civil violations and contains a referral provision, criminal violations must first be handled by the Commission, and the Attorney General may only become involved in the matter once the Commission has voted to refer the violation. The appellate court agreed with the district court’s rejection of the argument, holding that there is a presumption against any limitation on the Attorney General’s prosecutorial authority and Congress must show "clear and unambiguous" intent to restrict the Attorney General’s authority to investigate and prosecute criminal offenses. The Act does not explicitly limit the Attorney General in any way. The court held that nothing in the plain language of the Act nor the legislative history required a referral prior to prosecution by the Attorney General.

The appellate court found that the Commission and the Department of Justice have concurrent jurisdiction to investigate knowing and willful violations of the Act. Both agencies may initiate investigations and make referrals to each other.

Plaintiff Marcus

On March 10, 2008, the U.S. District Court for the District of Arizona granted the Commission’s motion to dismiss the suit filed by Jon Marcus against the U.S. Attorney General and the Chairman of the FEC, and denied the plaintiff’s motion for declaratory judgment, holding that the Attorney General has discretion over whether to investigate and prosecute criminal violations of the Federal Election Campaign Act (the Act) and is not required to wait for a referral of a case from the Commission.

In this case, the court agreed with the court decisions in Barry Bialek v. Gonzales, et al. and Geoffrey N. Fieger, et al. v. Gonzales, et al. that the plain language of the Act does not "infring[e] the Attorney General’s plenary power to enforce criminal violations of the Act." The court further found that the Act’s legislative history "demonstrates that Congress did not intend to limit or displace the Attorney General’s independent authority to pursue criminal violations of the Act, and that prior case law has held that criminal enforcement may either originate with the Attorney General or stem from a referral by the Commission to the Attorney General." [1]

The court denied the plaintiff’s motions for a hearing and oral arguments and for declaratory judgment and granted the Commission’s motion to dismiss the complaint with prejudice.

The plaintiff filed a Notice of Appeal in this case on March 18, 2008.

Plaintiffs Beam

On March 7, 2008, the U.S. District Court for the Northern District of Illinois granted the Commission’s motion to dismiss the First Amended Complaint filed by Jack and Renee Beam (the plaintiffs) against the U.S. Attorney General and the Chairman of the FEC. The court held that it lacked subject matter jurisdiction over plaintiffs’ claims, that plaintiffs failed to establish Article III standing, the case was not ripe for review and the FEC did not violate the Federal Election Campaign Act (the Act).

The District Court found in favor of the Commission and the Department of Justice on every issue addressed in the decision. The court held that the plaintiffs lacked standing necessary for the court to have subject matter jurisdiction over the suit. The plaintiffs did not allege in their complaint that the Department of Justice had "raided" their own home or seized their own bank records, but alleged only raids affecting other Fieger associates and employees. The plaintiffs did not show that they had suffered any harm and thus did not meet the judicial requirement of "injury in fact." The Court also found plaintiffs failed to establish standing with respect to the RFPA claim because they relied only upon "unsubstantiated speculation" that the Commission had possession of their private banking records and that the Commission had illicitly obtained those records.

The court also found that the plaintiffs’ case was not ripe for review. The court stated that because neither the Attorney General nor the FEC had made decisions about whether or how to enforce applicable laws against the plaintiffs, the court could not assess whether any agency misconduct affected the plaintiffs. Additionally, the plaintiffs identified no hardship that they would suffer if the court were to wait to decide their claims until the alleged investigations were complete.

Although the plaintiffs alleged that the Commission violated the Act in several ways, the court found that the allegations provided no basis for relief. The court agreed with the other District Court decisions in Fieger v. Gonzales and Bialek v. Gonzales. The court held that, contrary to plaintiffs’ assertions, the FEC is not required to refer a matter to the Department of Justice prior to the Attorney General initiating an investigation. The Attorney General has sole authority to investigate and prosecute criminal violations of the U.S. Code, unless Congress clearly and unambiguously restricts that authority.

The court found no evidence that Congress intended to limit the Attorney General’s authority to prosecute criminal violations of the Act. Regarding the plaintiffs’ request that the court order the FEC to conduct an investigation into the alleged illegal activities, the court found that "the judiciary has no power to dictate the timing or nature of an investigation," or require the FEC to conduct an investigation at all.

The court granted leave to plaintiffs to file a Second Amended Complaint. Plaintiffs filed their new complaint on March 24, 2008.

FOOTNOTES:

[1] The court specifically rejected the plaintiff’s assertion that 1980 amendments to the Act had overturned United States v. International Union of Operating Engineers, Local 701, 638 F.2d 1161 (9th Cir. 1979).

• Bialek v. Mukasey [formerly Bialek v. Keisler; Bialek v. Gonzales], U.S. District Court for the District of Colorado, 07-CV-00321-WYD-PAL.
• Marcus v. Mukasey [formerly Marcus v. Gonzales], U.S. District Court for the District of Arizona, CV070398-PCT-EHC.
• Beam v. Gonzales, U.S. District Court for the Northern District of Illinois, 07CV1227.

Source:   FEC Record — August 2008; May 2008; August 2007; April 2007

Appeals Court (10th Circuit)

Court decisions:

• Opinion affirming District Court Dismissal of Case (06/24/2008)

Related documents:

• Brief for the Federal Election Commission Chairman in His Official Capacity (09/28/2007)

District Court (Colorado)

Court decisions:

• Order Granting Defendants' Motion to Dismiss (06/28/2007)