Reagan Bush Committee v. FEDERAL ELECTION COM'N, Civ. A. No. 81-1893.

CourtUnited States District Courts. United States District Court (Columbia)
Writing for the CourtJOYCE HENS GREEN
Citation525 F. Supp. 1330
PartiesREAGAN BUSH COMMITTEE, et al., Plaintiffs, v. FEDERAL ELECTION COMMISSION, Defendant.
Docket NumberCiv. A. No. 81-1893.
Decision Date17 November 1981

525 F. Supp. 1330

REAGAN BUSH COMMITTEE, et al., Plaintiffs,
v.
FEDERAL ELECTION COMMISSION, Defendant.

Civ. A. No. 81-1893.

United States District Court, District of Columbia.

November 17, 1981.


525 F. Supp. 1331
COPYRIGHT MATERIAL OMITTED
525 F. Supp. 1332
Edward L. Weidenfeld, Herbert L. Fenster (argued), Thomas W. Hussey, McKenna, Conner & Cuneo, Washington, D. C., for plaintiffs

Charles N. Steele, Gen. Counsel, Lawrence M. Noble, Asst. Gen. Counsel (argued), Sondra L. Mills, Daniel J. Blessington, Attys., Federal Election Commission, Washington, D. C., for defendant.

MEMORANDUM OPINION

JOYCE HENS GREEN, District Judge.

This is an action by the Reagan Bush Committee and the Reagan Bush Compliance Fund (collectively, RBC), two campaign

525 F. Supp. 1333
committees of the Republican Presidential and Vice-Presidential candidates in the 1980 election to enjoin defendant, the Federal Election Commission (FEC), from withholding certain documents assertedly required to be disclosed under the Freedom of Information Act, 5 U.S.C. § 552 (FOIA), and from making any public disclosure of certain reports relating to audits of RBC conducted by the FEC before RBC is afforded an adequate hearing with respect to the subject of the audit and related matters pending before the FEC

A hearing on the preliminary injunction sought by RBC was consolidated with the trial on the merits and held on October 21, 1981. The FEC has moved to dismiss the cause for lack of subject matter jurisdiction and failure to state a claim upon which relief can be granted, or, in the alternative, for summary judgment. RBC has moved for partial summary judgment, asking that the Court enter an order precluding the FEC from rendering and publishing an interim determination on allegations and recommendations pending before the Commission with respect to any violations of federal election laws RBC may be charged with having committed, or any repayments of campaign funds that the FEC may order RBC to make, without first providing RBC the hearing it seeks. Because it is clear that the FEC has not withheld any documents from RBC improperly and that the report the FEC plans to disclose cannot by law contain information concerning violations of election laws and, in any event, is not a final determination of liability (continued input into the process and judicial review still to be available to RBC at subsequent stages of the administrative procedure), dismissal without prejudice as to the FOIA request and summary judgment as to the application for injunctive relief against public disclosure of the audit report will be granted to the FEC and RBC's motion for partial summary judgment will be denied.

Some discussion of the background of this case is necessary to comprehend what precisely is at stake here. Indeed, defendant suggests that the dispute may in part be attributable to a misunderstanding on the part of RBC as to the relevant audit process and the nature of the report the FEC plans to make public. The two RBC committees are organizations authorized to receive campaign contributions and payments and to make campaign expenditures under the Federal Election Campaign Act (FECA), 2 U.S.C. §§ 431 et seq., and the Presidential Election Campaign Fund Act (PECFA), 26 U.S.C. §§ 9001 et seq. Complaint, ¶¶ 2, 3. RBC received $29,440,000 from the United States Treasury through the Presidential Election Campaign Fund. Defendant's Statement of Facts Not in Dispute, ¶ 5. RBC was paid this amount upon the conditions that it comply with certain provisions of PECFA and, inter alia, agree "to obtain and furnish to the Commission such evidence as it may request of the qualified campaign expenses of its campaign," "to keep and furnish to the Commission such records, books, and other information as it may request," and "to submit to an audit and examination by the Commission under Section 9007 and to pay any amounts required to be paid under such section." Letter from the Honorable Ronald Reagan and the Honorable George Bush to the Commission, July 18, 1980 (Exhibit 1 to Defendant's Opposition to Plaintiffs' Motion for a Preliminary Injunction). These conditions are prerequisites to eligibility to receive funds under PECFA. 26 U.S.C. § 9003(a).1

The FEC is the agency responsible for administering the provisions of the two

525 F. Supp. 1334
acts. The two acts have different, but related purposes. PECFA establishes a fund for Presidential candidates' campaigns from tax monies. The act provides a scheme by which candidates are determined to be eligible for payments from the fund and sets forth standards to determine when candidates have received more than their fair share of monies from the fund and must make repayments. 26 U.S.C. §§ 9001 et seq. FECA, on the other hand, does not concern the disbursement of campaign funds to candidates, but regulates the organization and operation of campaigns, by, inter alia, requiring certain organizational and financial reports, and prohibiting or limiting certain campaign contributions. 2 U.S.C. §§ 431 et seq. The FEC derives authority from PECFA to conduct audits and examinations to determine whether repayments are due under that act. 26 U.S.C. § 9007.2 Its authority to enforce violations of PECFA (e. g., knowing and willful failures to comply with the payment conditions, see, 26 U.S.C. § 9012) and of FECA is found in FECA, at 2 U.S.C. § 437g

The audit report in question is a product of the examining and auditing process under PECFA, rather than of the enforcement procedure under FECA. The audit process begins after each Presidential election, when the Commission is required to conduct an examination and audit of the qualified campaign expenses of the candidates of each political party for President and Vice President. 26 U.S.C. § 9007(a); 11 C.F.R. § 9007.1. The audit serves to determine whether the candidate has been paid from the Campaign Fund more than he was entitled to receive under section 9004 of the Act and should make repayments to the Fund. 26 U.S.C. 9007(b); 11 C.F.R. § 9007.2. An interim audit report, not required by statute or regulation, is presented to each candidate's

525 F. Supp. 1335
campaign committee, with an opportunity to respond thereto, under an informal practice established by the FEC. Letter from FEC Chairman McGarry to Counsel for RBC, August 4, 1981 (Exhibit H to Complaint)

Upon completion of the final audit, which may or may not contain a determination that repayments are appropriate, the Commission is required to notify the candidates whether such repayments will be required. 26 U.S.C. § 9007(b)(2); 11 C.F.R. § 9007.2(a). A candidate found to be owing repayments must make such repayments within 30 days of receiving notice thereof from the Commission, but may request a 90 day extension of the repayment period. 11 C.F.R. § 9007.2(b). Moreover, if a candidate disputes the finding that repayments are due, he is afforded the opportunity to present to the Commission his arguments to the contrary, in writing, within 30 days of the issuance of the Commission's determination, a further 30 day extension of such time available upon request by the candidate and grant by the Commission. 11 C.F.R. § 9007.2(c). The Commission must consider any such submittals by a candidate in making its final determination on the repayment question, which determination must contain a written statement of reasons for the recommendation made. 11 C.F.R. § 9007.2(d), (e). Judicial review of a final determination on this issue is available by appeal to the United States Court of Appeals for the District of Columbia Circuit. 26 U.S.C. § 9011(a).

If the audit process should uncover information indicating a violation of PECFA (i. e., the knowing and willful incurring of excess expenditures, acceptance of certain contributions to defray expenses, making unauthorized expenditures and contributions, and the like as noted at 26 U.S.C. § 9012) or FECA, such information may be used in the enforcement process under FECA, at 2 U.S.C. § 437g. However, information relating to any notification or investigation under § 437g must remain confidential. 2 U.S.C. § 437g(a)(12)(A).

In the matter at hand, the FEC is not near its final determination on the question of repayment. The FEC commenced its audit report of RBC pursuant to 26 U.S.C. § 9007 on January 28, 1981. Defendant's Statement of Facts Not in Dispute, ¶ 6. On March 27, 1981, the Audit Division of the FEC held an "exit conference" with officials and attorneys of RBC at which they discussed the Audit Division's preliminary findings. Id. The same findings were expressed in the Audit Division's "interim report," which was delivered to RBC on June 19, 1981. Id.; Complaint, ¶ 15. In the letter accompanying the report, the Assistant Staff Director for the Audit Division informed RBC that it would have 30 days to respond to the findings of the auditors, after which time the audit staff would present a "final audit report" to the Commission for its approval and for subsequent public release. Exhibit A to Complaint; Defendant's Statement of Facts Not in Dispute, ¶ 6. On July 6, 1981, RBC asked for a 30 day extension of its time to respond to the interim report, which was denied by the FEC on July 13, 1981. RBC submitted its response to the report on July 20, 1981, under protest, because it contended that it needed more time to make an adequate response and believed it was entitled to a stay of further Commission action and an administrative hearing on the issues considered in the report. Plaintiffs' Response to Defendant's Statement of Facts, ¶¶ 6, 7; Complaint, ¶ 39. On August 4, 1981, the FEC granted RBC an extension of time until August 11, 1981 to supplement its response in writing, but denied its request for a stay of further action and a hearing. Letter from FEC Chairman McGarry to Counsel for RBC (Exhibit H to Complaint). RBC filed its complaint with this Court on August 10,...

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8 practice notes
  • Carter/Mondale Presidential Committee, Inc. v. Federal Election Com'n, No. 82-1754
    • United States
    • United States Courts of Appeals. United States Court of Appeals (District of Columbia)
    • 24 Junio 1983
    ...gave the Committee ample notice that the FEC intended to and did produce a final, reviewable action. 16 Cf. Reagan Bush Comm. v. FEC, 525 F.Supp. 1330, 1334-35, 1338 (D.D.C.1981) (explaining the FEC's informal practice of using interim audits in its review of expenditures under the Presiden......
  • Watts v. Des Moines Register and Tribune, Civ. No. 78-400-1.
    • United States
    • United States District Courts. 8th Circuit. United States State District Court of Southern District of Iowa
    • 17 Noviembre 1981
    ...conferred upon certificate-holders in the voting trust agreement with respect to repurchased certificates, as discussed in this Order. 525 F. Supp. 1330 IT IS FURTHER ORDERED that plaintiffs' cross-motion for summary judgment as to claims raised in Count Four of the amended complaint is her......
  • Kennedy for President Committee v. Federal Election Com'n, No. 83-1521
    • United States
    • United States Courts of Appeals. United States Court of Appeals (District of Columbia)
    • 15 Mayo 1984
    ...more elaborate procedural safeguards are respected. See 2 U.S.C. Sec. 437g; 26 U.S.C. Sec. 9042; see also Reagan Bush Committee v. FEC, 525 F.Supp. 1330, 1337 (D.D.C.1981) ("Repayment determinations are not considered to involve violations of law, but 'Criminal penalties are provided for wi......
  • John Glenn Presidential Committee, Inc. v. Federal Election Com'n, No. 86-1348
    • United States
    • United States Courts of Appeals. United States Court of Appeals (District of Columbia)
    • 23 Junio 1987
    ...made simply and solely a repayment determination, one "not considered to involve violations of law." See Reagan Bush Committee v. FEC, 525 F.Supp. 1330, 1337 (D.D.C.1981). This court has observed that the Matching Payment Act does authorize the imposition of penalties "[w]hen a candidate kn......
  • Request a trial to view additional results
8 cases
  • Carter/Mondale Presidential Committee, Inc. v. Federal Election Com'n, No. 82-1754
    • United States
    • United States Courts of Appeals. United States Court of Appeals (District of Columbia)
    • 24 Junio 1983
    ...gave the Committee ample notice that the FEC intended to and did produce a final, reviewable action. 16 Cf. Reagan Bush Comm. v. FEC, 525 F.Supp. 1330, 1334-35, 1338 (D.D.C.1981) (explaining the FEC's informal practice of using interim audits in its review of expenditures under the Presiden......
  • Watts v. Des Moines Register and Tribune, Civ. No. 78-400-1.
    • United States
    • United States District Courts. 8th Circuit. United States State District Court of Southern District of Iowa
    • 17 Noviembre 1981
    ...conferred upon certificate-holders in the voting trust agreement with respect to repurchased certificates, as discussed in this Order. 525 F. Supp. 1330 IT IS FURTHER ORDERED that plaintiffs' cross-motion for summary judgment as to claims raised in Count Four of the amended complaint is her......
  • Kennedy for President Committee v. Federal Election Com'n, No. 83-1521
    • United States
    • United States Courts of Appeals. United States Court of Appeals (District of Columbia)
    • 15 Mayo 1984
    ...more elaborate procedural safeguards are respected. See 2 U.S.C. Sec. 437g; 26 U.S.C. Sec. 9042; see also Reagan Bush Committee v. FEC, 525 F.Supp. 1330, 1337 (D.D.C.1981) ("Repayment determinations are not considered to involve violations of law, but 'Criminal penalties are provided for wi......
  • John Glenn Presidential Committee, Inc. v. Federal Election Com'n, No. 86-1348
    • United States
    • United States Courts of Appeals. United States Court of Appeals (District of Columbia)
    • 23 Junio 1987
    ...made simply and solely a repayment determination, one "not considered to involve violations of law." See Reagan Bush Committee v. FEC, 525 F.Supp. 1330, 1337 (D.D.C.1981). This court has observed that the Matching Payment Act does authorize the imposition of penalties "[w]hen a candidate kn......
  • Request a trial to view additional results

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