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 Beam case is one of the several cases concerning the investigation into the Michigan law firm of Fieger, Fieger, Kenney & Johnson (see Marcus v. Mukasey). According to the complaint filed March 2, 2007, the Beam plaintiffs made contributions to John Edwards’ 2004 presidential campaign. The plaintiffs allege that in November 2005, the Department of Justice began an investigation into possible violations of the Act by the plaintiffs and other members of the law firm. Plaintiff Jack Beam is “Of Counsel” to the law firm. On September 26, 2006, the Commission notified the plaintiffs that the Commission had begun an investigation of potential civil violations of the Act. See the April 2007 Record.
The plaintiffs filed a complaint with the District Court in Illinois, alleging that the Department of Justice could not investigate the alleged criminal violations of the Act until the Commission formally referred the matter to the Department of Justice. Additionally, the complaint alleged that the Commission failed to uphold the Act and asked the court to require the Commission to conduct and conclude an investigation prior to referral to the Department of Justice. This Complaint was dismissed on June 22, 2007, but the court granted plaintiffs leave to file a First Amended Complaint. Plaintiffs filed their First Amended Complaint on June 29, 2007, raising substantially the same allegations contained in their initial Complaint, but adding new allegations that the Department of Justice and the Commission obtained their private bank records illegally in violation of the Right to Financial Privacy Act (RFPA), 2 U.S.C. § 3401 et seq., and that the defendants retaliated against plaintiffs for engaging in constitutionally protected activity.
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.
U.S. District Court for the Northern District of Illinois, 1:07-cv-01227.