FEC v. Dramesi for Congress

On July 25, 1986, the U.S. District Court for the District of New Jersey granted the FEC's motion for summary judgment in FEC v. Dramesi for Congress Committee (Civil Action No. 85-4039). The court found that the John A. Dramesi for Congress Committee's treasurer, Russell E. Paul, had violated 2 U.S.C. §441a(f) by knowingly accepting an excessive contribution from the New Jersey Republican State Committee (the State Committee) and ordered Mr. Paul to pay a $5,000 civil penalty to the U.S. Treasurer.[1] The court had previously entered a $5,000 default judgment against the Dramesi Committee for accepting the excessive contribution.

In 1990, the U.S. District Court for the District of New Jersey granted a motion by the FEC to hold the committee and Mr. Paul, as treasurer, in contempt of court for failing to pay the penalties imposed in 1986 (FEC v. Dramesi for Congress Committee, No. 85-4039(MHC) (D.N.J. Sept. 5, 1990) (unpublished opinion)).

Background

In 1982, when the State Committee made a $5,000 contribution to the Dramesi Committee, the State Committee had not achieved multicandidate status because it had not yet satisfied the six-month registration requirement.[2] Consequently, the State Committee was only eligible to make a contribution of up to $1,000 per election to each Republican Congressional candidate in New Jersey, and the Dramesi Committee could legally receive only $1,000 for the primary election.

On learning of the State Committee's excessive contributions to Republican House candidates, the FEC initiated enforcement proceedings against the State Committee. When the Commission failed to reach a settlement with the Dramesi Committee, the agency filed a suit against the Committee and its treasurer in which it asked the court to: (1) assess a $5,000 civil penalty against the Committee for accepting the State Committee's excessive contribution and (2) order the Dramesi Committee to refund the excessive portion ($4,000) to the State Committee.

The court's ruling

The court observed that, under the FEC regulations, the treasurer of a political committee has to "'make his or her best efforts to determine the legality of a contribution.'"[3] The court therefore found that "Mr. Paul...had a duty to determine [the contribution's] propriety. Instead, he merely assumed from the source of the contribution that it was legal."

Nor did the court find any merit to defendant's contention that he had no way of knowing the contribution was illegal. The court noted that the defendant could have consulted the Index of Multicandidate Political Committees, an "exhaustive list of such eligible [multicandidate] committees, compiled by the FEC, [which] was readily available to the defendants."

The court therefore found that "Mr. Paul, as Treasurer of the Dramesi Committee, acted intentionally in accepting the $5,000 contribution in question, and was fully aware of the facts rendering his conduct unlawful." Accordingly, the court ruled that defendant "knowingly accepted" the State Committee's excessive contribution, in violation of 2 U.S.C. §441a(f).

FEC's contempt motion

Although finding the Dramesi committee in contempt, the court did not take any action against it since the committee is defunct. The court, however, rejected Mr. Paul's argument that he should not be held personally liable for payment of the penalty imposed against him. The court stated that, in its previous decision in this case, "we determined that Russell E. Paul's liability was distinct from the liability of the Committee." The court went on to state that, because "political committees have a tendency to dissolve after an unsuccessful campaign," Congress chose to hold an individual-the committee treasurer-responsible for compliance with the Federal Election Campaign Act. See 2 U.S.C. §432(a) and (c). It therefore follows that "an individual will also stand responsible for his indiscretions as a treasurer."

The court, in addition to holding Mr. Paul in contempt, ordered him to pay the $5,000 penalty within 30 days. The court imposed a $50 per day assessment if payment was not complete within 30 days. On January 2, 1991, the court issued stipulation and order in which Mr. Paul agreed to pay a total of $5,317 to the FEC. That amount represented the original $5,000 penalty, $91 in interest charges and $226 in FEC costs. The Commission agreed to waive the contempt penalties of $50 a day (which had been accumulating since the original contempt order in 1990) provided that Mr. Paul pay the $5,317 by March 1, 1991.

FOOTNOTES:

[1] On June 16, 1986, the U.S. District Court for the District of Columbia found that another New Jersey House incumbent campaigning for reelection in 1982 had not knowingly accepted an excessive contribution from the New Jersey Republican State Committee. See FEC v. Re-Elect Hollenbeck to Congress Committee.

[2] Multicandidate committees may contribute up to $5,000 per election to a candidate's authorized committee(s) or any other political committee. To achieve multicandidate status, a committee must have more than 50 contributors, have been registered for at least six months and, with the exception of state party committee, have made contributions to five or more candidates for federal office. 2 U.S.C. Section 441a(a)(4); 11 CFR 100.5(e).

[3] See 11 CFR 103.3(b)(1).

Source:   FEC Record— March 1991; November 1990; September 1986. FEC v. Dramesi for Congress Committee, 640 F. Supp. 985 (D.N.J. 1986).