Free Speech For People v. Federal Election Commission

Free Speech For People has filed a lawsuit against the Federal Election Commission for failing to investigate a $150,000 “hush money” payment made in 2016 to Karen McDougal, one of President Trump’s former mistresses, as a potential violation of federal campaign finance law. The investigation is necessary because, even after federal prosecutors have investigated some of the parties involved, critical questions remain unsettled—including the exact nature of President Trump’s role. The Department of Justice is unlikely to press further against Trump or his campaign, so the American public needs an investigation by the independent bipartisan Federal Election Commission.

The lawsuit challenges the Federal Election Commission’s failure to act on a February 2018 administrative complaint from Free Speech For People. That complaint (which was amended in April and July 2018) presented evidence that President Trump, his campaign, and his personal lawyer and campaign operative Michael Cohen arranged for American Media Inc. (the publisher of the National Enquirer) to pay $150,000 to buy the silence of Karen McDougal, a former Trump mistress, in the 2016 election. Federal prosecutors have concluded proceedings against Cohen, who pleaded guilty, and American Media, which entered into a non-prosecution agreement, for violating the Federal Election Campaign Act.

While Cohen has said that he arranged the McDougal hush money “at the direction of, and in coordination with” the president, Trump and his team have consistently denied Trump’s involvement in the McDougal payoff. Instead, Trump and his allies have publicly accused Cohen of lying to get a better deal from prosecutors.

The American people deserve to learn the truth about what happened in the 2016 election, and neither prosecutors nor Congress seem inclined to dig any further into the hush money payoff. If Trump and his campaign are truly innocent, they should have the opportunity to exonerate themselves. But if they violated the law to sway the 2016 election, they must be held accountable.

Key facts

Caption Free Speech For People v.
Federal Election Commission
Court U.S. District Court for the District of Columbia
Docket No. 19-cv-01722
Status Complaint filed in federal court
Plaintiffs Free Speech For People
Defendant Federal Election Commission

 

 

 

Background

American Media Inc., the company that owns the National Enquirer, paid $150,000 for exclusive rights to a story of Karen McDougal and her affair with Donald J. Trump in 2006-07. McDougal’s earlier efforts to sell her story to the Enquirer had failed, but AMI began serious negotiations after Trump clinched the nomination. The deal was reached in August 2016. After purchasing the rights to the story, the National Enquirer, opted not to publish the story, a practice known as “catch and kill” in the tabloid business. The timing of the deal, and the AMI CEO’s close relationship with Trump, suggested that the decision not to publish might not have been a journalistic decision, but rather an effort to conceal a politically embarrassing fact and influence the 2016 general election, which would violate the Federal Election Campaign Act.

Since the filing of our complaint, Trump’s personal lawyer, Michael Cohen, pleaded guilty to federal criminal charges that are directly relevant. The criminal information against Cohen described the payments and charged two criminal counts: causing an unlawful corporate contribution, and an excess contribution. (These correspond to counts II and IIII in our FEC complaint.) In Cohen’s plea allocution, he further told the court that he made the illegal payments “in coordination with, and at the direction of” Trump. In September 2018, the U.S. Attorney for the Southern District of New York entered into a non-prosecution agreement with AMI.

What did President Trump do and when did he do it?

Some questions still remain about the exact role and liability of the Trump campaign or President Trump himself. To be sure, Cohen unambiguously implicated Trump in the McDougal payoff. As Cohen explained in court and in later congressional testimony, he arranged the McDougal hush money “at the direction of, and in coordination with” Trump. Yet unlike the similar Stormy Daniels affair, where Trump has already admitted that he authorized a hush money payment, Trump and his team have consistently denied Trump’s involvement in the McDougal payoff. As Trump insisted on Fox News, “Whatever [Cohen] did, he did on his own.” Instead, Trump and his allies have publicly accused Cohen of lying to get a better deal from prosecutors. House Oversight Committee ranking member Jim Jordan and Freedom Caucus Chairman Mark Meadows even asked Attorney General William Barr to investigate Cohen for perjury.

The Department of Justice is unlikely to tell us more about the role of President Trump or the Trump campaign. Special Counsel Mueller—who enjoyed some independence from direct Department of Justice oversight—felt that department policy compelled him not to reach any conclusions about whether a sitting president committed a crime. The prosecutors who investigated Cohen and American Media are subject to much greater control by the attorney general, so it’s unlikely they will do what Mueller would not. Trump’s campaign (as opposed to Trump himself) might not enjoy quite the same legal immunity, but it seems unlikely that Barr will allow a forceful criminal investigation there either.

Why we need an FEC investigation

The American public deserves a credible investigation and the judgment of a neutral fact-finder to answer these questions. That’s why we need the independent Federal Election Commission to stop its delay and conduct its own investigation. While the FEC is far from perfect, there are two key reasons why a proper FEC investigation is critical.

First, the FEC’s enforcement is civil, not criminal, and there is no bar in law or policy to the FEC investigating a sitting president’s campaign or the president himself. (For example, in 2013 the FEC fined the Obama campaign $375,000, among the largest penalties in the agency’s history.) Trump himself pointed out that most campaign finance violations, including those of President Obama’s campaign, are handled by the FEC as civil cases.

Second, the FEC is bipartisan: its four current commissioners are a Democrat, two Republicans, and an independent. None of them were appointed by President Trump, or have any need to carry his water. By the same token, none of them are what Trump calls “Obama holdovers.” If all four commissioners agree that Trump or his campaign violated the law in the McDougal payoff scheme, it will be hard to dismiss the investigation as a “witch hunt.” And while the FEC has earned a reputation for delay and dysfunction, the Federal Election Campaign Act authorizes lawsuits when the FEC’s failure to act on a complaint after four months (in this case, it has been sixteen months) is “contrary to law.”

Whatever the FEC ultimately decides, the investigation itself will have value to the American public. For example, the law requires that Trump and his campaign receive the opportunity to provide a detailed written response to all allegations. It’s one thing for Trump or his campaign to deny involvement on television or Twitter. It’s quite another to say that it in a written statement to a federal agency. (These responses are confidential at first, but must be made public when the FEC renders its final decision.) And while the FEC usually relies on documents and written submissions, it has the power to compel live testimony under oath.

The American people deserve to learn the truth about what happened in the 2016 election, and neither prosecutors nor Congress seem inclined to dig any further into the hush money payoff. If Trump and his campaign are truly innocent, they should have the opportunity to exonerate themselves. But if they violated the law to sway the 2016 election, they must be held accountable.

Major case developments

Administrative proceedings

Free Speech For People v. American Media et al. (FEC Matter Under Review No. 7332)

Court proceedings

Free Speech For People v. Federal Election Commission (D.D.C. No. 19-cv-01722)

In the news

  • Bloomberg Government, Trump’s Ties to Playboy Model Focus of Campaign Finance Lawsuit (June 13, 2019) (subscription required)
  • Newsweek, McDougal Payment from American Media was Trump Campaign Contribution, Watchdog Group Claims to FEC (Feb. 19, 2018)
  • CNN, Michael Cohen Implicates Trump in Hush Money Scheme (Aug. 22, 2018)
  • The New Yorker, Donald Trump, a Playboy Model, and a System for Concealing Infidelity (Feb. 16, 2018)
  • The Wall Street Journal, National Enquirer Shielded Donald Trump From Playboy Model’s Affair Allegation (Nov. 4, 2016)

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