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Congressional Standing to Protect the Power of the Purse

Do you remember how last summer I suggested the House’s odds of prevailing (in particular, with respect to standing) in a potential Obamacare lawsuit were in the vicinity of the proverbial snowball’s chance in hell? You don’t? Good, because that turns out to be not exactly correct.

To be fair (to myself), I was discussing a somewhat different lawsuit than the one the House ended up bringing. As originally explained by Speaker Boehner, the purpose of the suit was “to compel the president to follow his oath of office and faithfully execute the laws of our country.” Specifically, it was understood that the proposed lawsuit would “focus on the Obama administration’s implementation of the Affordable Care Act, particularly the failure to implement the employer mandate in accordance with the January 1, 2014 effective date set forth in the law.”

The House ultimately ended up bringing suit against the Secretaries of HHS and Treasury for disregarding the employer mandate deadline specified in the ACA and for reducing the statutory percentage of employees who are required to be offered insurance under that mandate. These are essentially the claims we anticipated before the suit was filed (although the House wisely decided to bring them against cabinet officials rather than the president).

In addition to these employer mandate claims, however, the House alleged that the defendants had illegally spent billions of dollars in “cost-sharing” payments to insurance companies under the ACA. Such payments were made pursuant to section 1402 of the ACA in order to compensate insurance companies for reducing the out-of-pocket cost of insurance for lower income beneficiaries.

According to the House’s complaint, payments under section 1402 must be funded through the normal annual appropriations process. Although the administration initially recognized this by submitting an FY 2014 appropriations request for these payments, it changed its position after Congress refused to appropriate the funds. Beginning in January 2014, the administration drew and spent money from permanent appropriations to make the section 1402 payments. The House maintains that this was illegal and unconstitutional because there was no permanent appropriation that covered these payments.

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Why Wouldn’t Congress Give Pagliano Immunity?

Bryan Pagliano, a former State Department staffer who helped to set up Hillary Clinton’s private e-mail server, has informed several congressional committees, including the House Select Committee on Benghazi and the Senate Judiciary Committee, that he will invoke the Fifth Amendment privilege against self-incrimination if forced to appear before those committees to answer questions about that subject. Pagliano’s attorney cited “the ongoing FBI inquiry into the security of Clinton’s e-mail system” as the basis for his fear of possible incrimination.

In connection with the Lois Lerner matter, we have discussed the various legal issues related to a former government official’s invocation of the Fifth Amendment before Congress. One of the possible responses to such invocation is for the congressional committee to grant the witness immunity, thereby preventing his congressional testimony from being used against him in a future prosecution. Once such immunity is granted, the witness no longer has the legal right to refuse to answer questions before the committee based on the Fifth Amendment.

In theory, the immunity granted extends only to the actual use of the congressional testimony, but in practice it becomes nearly impossible to prosecute the congressional witness for any crime related to the subject of that testimony. Thus, if the committee believes that the witness may truly face the possibility of prosecution, it may be reluctant to grant immunity. This is one of the primary reasons that congressional grants of immunity are fairly rare (the last one given was to Monica Goodling in 2007 by the House Judiciary Committee).

With respect to Pagliano, however, this would hardly seem to be a serious issue. Unlike Lerner, he is not a senior or central figure in the investigation. The chances of his facing any kind of criminal jeopardy for setting up a private e-mail server (which by definition had to have occurred before any classified e-mails were sent through that server) would seem extremely remote.

In any event, the process of granting immunity allows the executive branch, in the person of the Attorney General, to express any concerns about the grant of immunity that it may have. The congressional committee must notify the Attorney General of its intent to seek the immunity order and thus the Attorney General has the opportunity to inform the committee of any objections to the grant of immunity. However, while the Attorney General has the power to delay the grant of immunity by up to 20 days, see 18 U.S.C. § 6005 (c), she has no power to veto or ultimately stop it from being granted. See Application of U.S. Senate Sel. Comm. on Pres. Campaign Activities, 361 F.Supp. 1270, 1276 (D.D.C. 1973).

Applying for immunity requires a vote of either two-thirds of the congressional committee or a majority of the full House or Senate. Thus, while the Attorney General cannot stop the grant of immunity, the committee minority can at least force the matter to full body if it objects to the grant. In the circumstances of this case, it seems to me it would be difficult to make a credible argument as to why Pagliano shouldn’t receive immunity. But the process gives everyone an ample opportunity to express their views.

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Government Not Impressed by Menendez’s “Policy” Approach to Speech or Debate

The government has filed its brief in opposition to Senator Menendez’s Speech or Debate arguments. A fuller analysis will have to wait, but the arguments look to be pretty much as I expected.

From the brief’s conclusion:

Defendant Menendez’s broad, unprincipled interpretation of the Speech or Debate Clause is a blueprint for immunizing criminal activity on Capitol Hill. Under defendant Menendez’s interpretation, all a Member of Congress—or staffer—would have to do in order to shield his illegal activity from criminal prosecution is insert the word “policy” into a corrupt conversation, mention an unrelated bill in an unlawful email, write something legislative on a calendar entry for an illicit gathering, threaten to hold a hearing at the conclusion of a meeting, or ask for a briefing at the end of an effort to influence the Executive Branch.

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Professor Seth Barrett Tillman: Hillary Can Run from Jail

(see update below) More precisely, Tillman argues here that any attempt to disqualify former Secretary Clinton from the presidency based on conviction of a crime, including 18 U.S.C. § 2701 (which provides that anyone convicted “shall forfeit his office and be disqualified from holding any office under the United States”), would be unconstitutional. FWIW, I think he is right.

Now if Clinton were to be elected to the presidency while actually serving time in prison, a different set of issues would be presented. But I think we can cross that bridge when we come to it.

(Clarification: Tillman does not believe that section 2701’s disqualification language is unconstitutional, but he believes it would be unconstitutional if it were intended to apply to the presidency and other elected positions. In part for this reason, he would interpret the “office under the United States” language as not applying to elected positions).

Update: former Attorney General Mukasey, to whom Tillman was in part responding, has emailed Professor Eugene Volokh to acknowledge “on reflection, … Professor Tillman’s [analysis] is spot on, and mine was mistaken…. The disqualification provision in Section 2071 may be a measure of how seriously Congress took the violation in question, and how seriously we should take it, but that’s all it is.” 

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Rare Bipartisan Agreement: Let’s Sweep Baku Gifts Under the Rug

It’s hard to decide which is the worst part of the House Ethics Committee’s report on member/staff travel to Baku, Azerbaijan, but I am going to go with the discussion of tangible gifts. At least it is easiest to explain why that part is wrong. I will discuss other aspects of the report in future posts.

As you may recall, a large number of members and staff traveled to a 2013 conference in Baku, courtesy of a rather shadowy group of Turkish American non-profit organizations. The travel was approved in advance by the Ethics Committee, but the approval letter explicitly warned each traveler about the possible receipt of gifts from foreign governments during the trip. Specifically, the letter noted that “[a]ny tangible gifts valued in excess of $350 received from a foreign government must, within 60 days of acceptance, be disclosed on a Form for Disclosing Gifts from Foreign Governments and either turned over to the Clerk of the House, or, with the written approval of the Committee, retained for official use.” Report at 20 n. 95.

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Will Senator Menendez’s Speech or Debate Gambit Work?

Last week Senator Menendez’s legal team moved to dismiss all of the charges against him on the ground that they depend on evidence protected by the Speech or Debate Clause. The key issue is whether the Clause’s protection applies to certain meetings and communications between Menendez (and/or his staff) and executive branch officials, including Secretary of HHS Kathleen Sebelius and Marilyn Tavenner, the head of the Center for Medicare and Medicaid Services (CMS).

The prosecution alleges that Menendez was attempting to pressure the executive branch into making policy changes for the benefit of Dr. Salomen Melgen, a close personal friend who had given the senator significant campaign contributions and personal gifts. In the case of Sebelius and Tavenner, for example, Menendez questioned CMS’s prohibition on multi-dosing of the drug Lucentis, a policy that exposed Melgen to significant legal and financial jeopardy.

Menendez does not dispute that Melgen brought the Lucentis issue to his attention, but he argues that this does not prevent his communications with the executive branch from constituting protected legislative oversight. His brief states:

Senator Menendez serves as a member of the Committee on Finance, which oversees HHS and CMS. In June 2009, Senator Menendez alerted his staff to a Medicare issue concerning his “close personal friend,” Dr. Melgen, and his staff then began investigating the issue. Throughout their entire investigation, the prosecutors failed to grasp the policy issues at stake and wrongly concluded that because Dr. Melgen was using facts personally known to him in his administrative matter that he must have been asking for his friend to intervene in his case. Nothing could be further from the truth, and discovery bears out that Senator Menendez made no effort to ever intervene in Dr. Melgen’s pending matters. The issues from Dr. Melgen’s case highlight a broader policy question of this Administration’s actions that benefit pharmaceutical companies while discounting issues experienced by practicing physicians—a policy question that falls squarely within Senator Menendez’s oversight responsibilities as a member of the Senate Finance Committee.

Menendez Br. at 13-15 (citations omitted).

To prevail on this motion, Menendez will likely have to persuade the court of two propositions, each of which is fairly considered a long shot. The first is a procedural/evidentiary point about how the court should evaluate whether the senator’s executive branch communications were protected legislative activity, on the one hand, or unprotected “constituent service,” on the other. Menendez seems to argue that so long as his communications were ostensibly about policy issues, rather than a particular individual or case, they are protected even if they were actually motivated by a desire to help that individual (and, presumably, even if the executive branch officials understood this to be the senator’s primary or sole objective). See Menendez Br. at 8 (“Courts must examine the substance of the communications themselves to determine whether the communications are apparently legislative activity and thus immunized by the Speech or Debate Clause.”) (emphasis in original); id. at 9 (“An errand on behalf of an individual that does not require a change in policy would be unprotected case work . . ., but the appearance of a broader policy issue changes the Speech or Debate analysis entirely.”) (emphasis added).

This position seems to me to be more lenient toward the assertion of Speech or Debate than previously enunciated in the caselaw, including by the Third Circuit’s interlocutory opinion in the Menendez investigation itself. There the court seemed to think that the actual purpose of the communications, not merely their ostensible policy content, was relevant to the Speech or Debate analysis. See In re Grand Jury Invest. (Menendez), slip op. at 4-5 & n. 3 (3d Cir. Feb. 27, 2015). Because Menendez’s communications were not “manifestly legislative acts,” the Third Circuit held, the district court must make specific factual findings about the legislative or non-legislative character of the communications. To the extent the communications had both a legislative component (e.g., gathering information for legislative purposes) and a non-legislative component (e.g., attempting to influence how the agencies treated Melgen’s case), the court instructed that these components should be separated, if possible, and if not the district court “must ascertain the nature of the act or communication by assessing its predominant purpose.” Id. at 5.

This language suggests that Menendez’s communications will not be protected if their predominant purpose was to benefit Melgen, even if they were phrased in purely policy terms. Put another way, a member cannot obtain Speech or Debate protection for his otherwise unprotected constituent service merely by avoiding any explicit reference to the actions he wants the agency to take. Cf. U.S. v. Blagojevich, slip op. at 12 (7th Cir. July 21, 2015) (“’Nudge, nudge, wink, wink, you know what I mean’ can amount to extortion under the Hobbs Act, just as it can furnish the gist of a Monty Python sketch.”).

The second questionable part of Menendez’s argument is the proposition that attempts to influence executive agencies are protected by Speech or Debate if they qualify as legislative oversight. As I noted in a previous post, and as the Third Circuit explained in U.S. v. McDade, 28 F.3d 283, 300 (3d Cir. 1994), the Supreme Court has often stated that attempts to influence the executive branch do not fall within the Speech or Debate Clause. Menendez does not explicitly refer to this caselaw, but he presumably will argue that the Court’s broad language should be read as applying only to routine casework for constituents, not to efforts to monitor or guide an agency on matters of policy, particularly by a member of a committee with jurisdiction over the subject.

The court found it unnecessary to resolve this issue in McDade and the recent Menendez panel did not address it directly. It seems unlikely to me that the facts of the Menendez case provide a good vehicle for establishing a “legislative oversight” exception to the general rule laid down by the Supreme Court. But it is somewhat difficult to disentangle this issue from the first question of whether Menendez’s predominant purpose was to assist Melgen rather than to advance a legislative objective.

All in all, I would rate Menendez’s chances of prevailing on his Speech or Debate motion as slim. As noted in footnote 6 of the senator’s brief, however, an order denying his motion can be immediately appealed. Thus, win or lose at the district court level, Menendez will be able to delay his trial, possibly through the end of the Obama administration, if he so chooses.

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Lessons from a Byzantine Scandal

Let’s say you are a Member of Congress who is approached by an obscure nonprofit organization about accepting an all-expense-paid trip to Baku, Azerbaijan during an upcoming recess. (Baku is on the western shore of the Caspian Sea, in case you need a map to locate it, which you probably do). The purpose of the trip is to attend a conference called the US-Azerbaijan Convention: Vision for the Future.

A brief glance at the itinerary for this event leaves little doubt it enjoys the official sanction of the Azerbaijan government. You and your colleagues will be meeting with the President of Azerbaijan himself, as well as the Speaker of Parliament, and will receive briefings from government agencies such as Customs and Border Protection, the Ministry of Foreign Affairs, and SOCAR, the state-owned oil company. These discussions will cover US-Azerbaijan relations, regional security challenges posed by Russia and Iran (between which nations Azerbaijan has the misfortune to be sandwiched), and matters relating to the construction of oil pipelines and energy security generally.

You decide, reasonably enough, that this looks like an interesting and educational trip that will help you gain a deeper understanding of these important matters on which you make policy. So you instruct your staff to work with the nonprofit organization, which we will call the “Turquoise Council of Americans and Eurasians” (TCAE), to submit the required forms and information to the House Ethics Committee, which then pre-approves the proposed trip pursuant to House Rule XXV, clause 5(d)(2).

And off you go, along with ten of your House colleagues, 32 staffers, 75 state legislators, and former elected officials such as Bill Richardson, Dick Lugar and Dan Burton. A journalist attending the conference describes it as “among the biggest concentrations of American political star power ever seen in the Caucasus,” which admittedly may be akin to boasting of the best gas station sushi in the state of Oklahoma.

The trip goes fine. You attend the scheduled events, try not to mispronounce too many Azeri names, and maybe even sneak in a little sightseeing in Baku’s Old City. You listen to a lot of speeches, including from former Obama administration officials David Plouffe, Robert Gibbs and Jim Messina. They mostly repeat the same pablum you could have heard in DC, though Gibbs does recount an amusing anecdote about then-Senator Obama haggling with a local rug merchant during a 2005 CODEL to Baku.

But no sooner than you have returned to the US, visions of lamb shish kebob still dancing in your head, the carping starts. At first it is largely directed at Plouffe, Gibbs and Messina, who received “five-figure checks” for their remarks at the Baku conference and are perceived as cashing in on their government service. (Public Citizen’s Craig Holman, the perpetual Dr. Bellows in pursuit of Major Nelson, says the Azeri government is “trying to buy favors with those who are well connected with the U.S. government” and suggests the three were “letting themselves be used as lobbyists.”) There is also criticism of the Baku conference as a whitewash of Azerbaijan’s less than stellar record on human rights and democracy.

The criticism hits closer to home, though, when it appears that your trip may not have complied with the rules regulating congressional travel after all. Although TCAE and other nonprofit organizations purported to be the sole source of funds for the congressional trips, reports emerge (see here and here) suggesting that the money actually came from other sources, particularly SOCAR. These allegations, which come out about the time you are filing your post-travel disclosure, are followed a year later by this Houston Chronicle article, which suggest congressional travelers to the Baku conference should have known that the conference was being funded by SOCAR and other oil companies based on banners and other conference materials that prominently identified these corporate sponsors.

Things go down hill from there. The Office of Congressional Ethics opens an investigation into the matter, asking you to provide documents and other information regarding your trip. The House Ethics Committee also starts looking into the matter and asks OCE to halt its investigation. OCE refuses, leaving you stuck in the middle. Then someone leaks OCE’s “confidential report” and you find your trip to Baku has made the front page of the Washington Post. It is somewhat unclear exactly what findings and recommendations OCE made, as the Post did not publish the report itself, but the Post article makes various insinuations about your ethics and judgment.

So, did you actually do anything wrong?

Like so much that has happened along the silk roads for the past couple millennia, it’s complicated.

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Congressional Standing to Sue: A Response to Grove and Devins on the History of Congressional Litigation

William and Mary law professors Tara Leigh Grove and Neal Devins have written this article arguing for “a limited congressional power to represent itself in court.” Specifically, they argue that while the House or Senate may enforce subpoenas (including subpoenas directed to the executive branch) in court, neither house may intervene in federal litigation to defend the constitutionality of federal statutes where the executive branch refuses to do so.

Professor Jack Beermann responds to Grove and Devins here. He disagrees with one of their conclusions, noting “there is no constitutional provision that can fairly be interpreted to prohibit Congress or one House of Congress from defending the constitutionality of a duly enacted federal statute.” Moreover, although Beermann agrees with Grove and Devins that the House or Senate may litigate in support of the investigatory power, he largely disagrees with their reasoning on this point also.

I think Beermann has by far the better of this argument, and it is tempting to let the matter rest there. But I think it worthwhile to correct at least one part of their thesis that Beermann accepts largely without challenge. Grove and Devins contend that the history of congressional involvement in litigation supports the distinction they draw between the investigatory power and other types of cases, including the defense of the constitutionality of federal law.  They say:

Historical practice supports our argument for a limited congressional power to represent itself in court. From 1789 until modern times, the House and the Senate asserted the power to conduct investigations and to litigate any disputes related to those investigations. By contrast, Congress historically delegated control over all other federal litigation to the executive. That was true even when the executive declined to defend a federal law. Although members of Congress occasionally participated as amici in such cases, neither Congress nor its components asserted the power to intervene on behalf of federal laws. This historical pattern remained unchanged until 1983, when the Supreme Court—with virtually no explanation—permitted intervention by the House and Senate counsel in INS v. Chadha.

This description, however, is misleading. To understand why, it is helpful to focus on Congress’s overall practices with regard to litigation in the pre-Watergate era. During the 1970s, particularly during Watergate itself, Congress became (somewhat) more litigious, reflecting factors such as (1) the increasing litigiousness of society itself, (2) an increasing tendency to see congressional-executive disputes as essentially legal in nature and (3) the development of institutional legal offices in both Houses. The intervention of the House and Senate counsel in the 1983 Chadha case must be seen against that background.

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The U.S. Attorney’s Troubling Decision in the Lois Lerner Case

Here is a link to US Attorney Ronald Machen’s letter to Speaker Boehner declining to submit the Lois Lerner contempt to the grand jury. Machen makes three points in this letter. First, he rejects the argument that the Committee on Oversight and Government Reform failed to follow proper procedures in notifying Lerner that her Fifth Amendment privilege claim had been overruled. Instead, he agrees with the COGR majority that “Ms. Lerner was given notice that her claim of privilege had been rejected and sufficient opportunity to answer the Committee’s questions after receiving that notice,” and he points out that the three Supreme Court cases relied on by Lerner’s defense (and the COGR minority) are clearly distinguishable. This conclusion is in accord with my views. See Can Lois Lerner Skate on a Technicality?

Second, Machen contends, contrary to the COGR majority, that Lerner did not waive her Fifth Amendment privilege. He concludes because Lerner only made general assertions of innocence “lacking substantive content,” her exculpatory opening statement did not constitute a waiver of the privilege. He relies primarily on two court of appeals decisions and one D.C. district court decision, all from the 1950s and none representing controlling precedent in his jurisdiction.

Moreover, it is not clear that these cases would dictate a finding in Lerner’s favor if followed. For example, even the parenthetical Machen uses for one of the cases, Ballantyne v. United States, 237 F.2d 657 (5th Cir. 1956), suggests that it is distinguishable. Ballantyne says that “the United States Attorney could not, by thus skillfully securing from appellant a general claim of innocence, preclude him from thereafter relying upon his constitutional privilege when confronted with specific withdrawals.” But the whole point of the Lerner waiver is that no one elicited her claim of innocence, skillfully or otherwise; her opening statement was entirely voluntary. Manchen obliquely acknowledges this point, but offers little more than the bare assertion that it is “doubtful” this would be sufficient to support a waiver.

This is not to say that Machen’s conclusion on waiver is unreasonable. As I have said, this is a close legal question, and reasonable people can disagree on the outcome. The issue is whether the decision should be made by the U.S. Attorney or by a court.

This brings us to Machen’s third point. Notwithstanding the apparently clear language of the statute requiring that a congressional contempt be presented to a grand jury (see, for example, then-Speaker Pelosi’s position in the Miers case), Machen contends that the decision is within his discretion. He further maintains that under DOJ policies that it is not proper to bring the matter before a grand jury unless he is convinced that Lerner’s privilege claim is invalid. Machen’s position here conflicts with both statutory text and congressional intent, IMHO, although I am not particularly surprised that he has taken this stance.

Essentially the U.S. Attorney’s office is reserving the right to make its own independent judgment about the legitimacy of a congressional contempt citation, even if that means resolving a close legal question in a way that protects a witness in an investigation that could embarrass the administration he serves. It is another in a long line of examples demonstrating Congress’s institutional weakness in controlling the executive.

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Can a House Committee Subpoena Clinton’s Server?

On the Megyn Kelly show last night, Judge Napolitano stated that Secretary Clinton’s server could not be subpoenaed by a House committee, but only by the House itself, because the committee lacks the power to subpoena “tangible things.” This echoes views expressed by Trey Gowdy, chairman of the Benghazi select committee, who claimed that his committee could not subpoena the server and suggested that whether even the House could subpoena it is an “open constitutional question.”

The Napolitano/Gowdy position strikes me as overly cautious. Admittedly, the question of whether a congressional subpoena can reach “tangible things” very rarely arises, and I am not aware of any precedent or even internal congressional guidance on the point. The quite comprehensive Congressional Oversight Manual, for example, does not seem to mention the issue. However, as described below, it is not necessary to resolve this general question to conclude confidently in favor of a House committee’s authority in the circumstances presented.

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