[EL] campaign expenditure reporting -- DOJ prosecution

[Barnaby Zall]

Not sure I would push the Ron Paul-related case too far to justify regulating typical campaign activities with vendors and the like. It's an example of a bribery and fraud scheme and the candidate (and probably campaign) apparently had no knowledge of it. Tanner's question seemingly didn't go to criminal schemes of a type that rises to the level of corruption, but to ordinary campaign-related activities. 



“These historic and traditionalcategories long familiar to the bar – including obscenity, defamation, fraud,incitement, and speech integral to criminal conduct – are well-defined andnarrowly limited classes of speech, the prevention and punishment of which havenever been thought to raise any Constitutional problem.” Stevens, 559 U.S. at 468 (quotation marks and citations omitted). None of these categoriesis implicated in the ordinary course of third-party subcontractors. 


And, no, there is no regular third-party expenditure reporting requirement in most state rules. Third-party expenditure reporting is, of course, an administrative nightmare (especially in getting a conviction), a tremendous trap for the unwary on both over- and under-inclusion, and represents a great opportunity for regulators and critics on all sides to complain loudly about conduct that wasn't readily apparent as criminality, but more akin to interpretation of the type of broad rules favored by some to catch all possible miscreants. I'm reminded of the FEC's long-standing requirement of reporting certain expenditures on an accrual basis even when the reporting committee is on a cash basis. And if a test is whether a particular activity is "law firm-related," well, that's pretty ambiguous, as shown by the two prior posts here which disagree about whether oppo is a traditional law firm service (having done that for years in my various law firms, I fall on the side of it being a traditional service in law firms that represent campaign or political clients; in many cases, at least some oppo may be part of ethically-required due diligence). 


Legislative drafting is an art, not a science, and creative ambiguity is probably over-used in an effort to log-roll a desired outcome to enactment.  And that's why the Ninth Circuit's recent panel decision in Lair v. Motl is being teed up for the Supreme Court: since corruption or the appearance of corruption is the only govt interest strong enough to overcome ordinary First Amendment speech and association rights, what has to be shown as "corruption" to justify restrictions such as limits on campaign contributions? The panel majority said anything that showed that a possibility of corruption was "not illusory." The dissent (Judge Carlos Bea) said that standard was foreclosed by long-standing Supreme Court decisions. The evidence in Lair was of an offer of campaign contributions that was rejected and ineffectual, and in any case were more in the nature of an attempt to support candidates that McCutcheon and other cases have already held was not corruption. So is it enough to show corruption to testify to something that has already been held not to be corruption and didn't, in fact, work?  My longer discussion at:
https://publicpolicylegal.com/2017/10/24/ninth-circuit-tees-up-latest-challenge-to-citizens-united-and-mccutcheon/. 


Barnaby Zall 
Law Office of Barnaby Zall
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Friday Harbor, WA 98250
360-378-6600



-----Original Message-----
From: David Mason <dmason12 at gmail.com>
To: Tyler Culberson <tylerculberson at gmail.com>
Cc: law-election at UCI.edu <law-election at uci.edu>
Sent: Fri, Nov 3, 2017 10:40 am
Subject: Re: [EL] campaign expenditure reporting -- DOJ prosecution



See this DOJ press release on convictions of three Ron Paul campaign staffers for false reporting with this explanation of the offense:


"Evidence at trial proved that the campaign expenditures to Sorenson were made in monthly installments of approximately $8,000 each and ultimately amounted to over $70,000.  The defendants concealed the payments by causing them to be recorded – both in campaign accounting records and in FEC filings – as campaign-related audio-visual expenditures, and by causing them to be transmitted to a film production company and then to a second company that was controlled by Sorenson.  The conspirators concealed their campaign’s payments to Sorenson from their candidate and also from the FEC, the FBI, and the public."   


https://www.justice.gov/opa/pr/three-members-2012-presidential-campaign-staff-guilty-concealing-campaign-expenditures-state


I was an expert witness at the first trial.


Dave Mason




On Fri, Nov 3, 2017 at 12:49 PM, Tyler Culberson <tylerculberson at gmail.com> wrote:

I am unaware of any regulation that requires expenditures to be earmarked as they relate to typical campaign activities, including opposition research (which is not not non-legal).







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