THE UNITED STATES DISTRICT COURT 

FOR THE NORTHERN DISTRICT OF ILLINOIS 

EASTERN DIVISION 

JACK BEAM and RENEE BEAM, 

 Plaintiffs, 

 v. 

MATTHEW S. PETERSEN, FEDERAL 

ELECTION COMMISSION CHAIRMAN, 

 Defendant. 

Civil No. 07cv1227 

Judge Rebecca R. Pallmeyer 

Magistrate Judge Cole 

DEFENDANT’S PROPOSED 

FINDINGS OF FACT AND 

CONCLUSIONS OF LAW 

DEFENDANT FEDERAL ELECTION COMMISSION’S 

PROPOSED FINDINGS OF FACT AND CONCLUSIONS OF LAW 

 Defendant Federal Election Commission (“FEC” or “Commission”) submits its proposed 

findings of fact and conclusions of law following the Court’s August 25 and 26, 2010, bench trial 

on plaintiffs’ claim under the Right to Financial Privacy Act (“RFPA”), 12 U.S.C. §§ 3401-22. 

Under the RFPA, “[f]inancial records originally obtained pursuant to [the RFPA] shall not be 

transferred to another agency or department unless the transferring agency or department 

certifies in writing that there is reason to believe that the records are relevant to a legitimate law 

enforcement inquiry.” 12 U.S.C. § 3412(a). For the reasons stated below, plaintiffs failed to 

prove by a preponderance of the evidence that the FEC violated section 3412(a), and, 

accordingly, the Court should enter judgment for the FEC. 

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I. PROPOSED FINDINGS OF FACT 

A. The Parties 

1. Plaintiff Jack Beam, a resident of Illinois, is an attorney who is “of counsel” to the law 

firm Fieger, Fieger, Kenney, Johnson & Giroux, P.C. (“Fieger law firm”). (Jack Beam, 

Trial Transcript (“Tr.”) 181:14-16; 195:16-18; Second Am. Compl. ¶ 1 (Doc. #91).) 

Plaintiff Renee Beam, also a resident of Illinois, is married to Jack Beam. (Renee Beam, 

Tr. 109:17-18; Second Am. Compl. ¶ 1 (Doc. #91).) 

2. Defendant Federal Election Commission is an independent agency of the United States 

government with exclusive civil jurisdiction over the administration, interpretation, and 

enforcement of the Federal Election Campaign Act (“FECA”), 2 U.S.C. §§ 431-57. 

B. The Department of Justice’s Grand Jury Investigation 

3. In 2005, the Department of Justice (“DOJ”) began to investigate whether the Fieger law 

firm reimbursed its employees and their family members for their campaign contributions 

to John Edwards’s 2004 presidential campaign, in violation of FECA’s ban on 

contributions in the name of another, 2 U.S.C. § 441f. (Joint Trial Exhibit (“Exh.”) 24 

(Audra Wassom Bayes, Second Deposition (“Dep.”) 13:14-15:13; 20:4-10); Mark 

Shonkwiler, Tr. 159:6-21; M. Kendall Day, Tr. 251:11-23.) 

C. The FEC’s Initial Consideration of Allegations About the Fieger Firm 

4. In February 2006, the Fieger law firm requested that the FEC begin a civil investigation 

of the allegations of FECA violations. (Exh. 24 (Wassom Bayes, Dep. 15:14-16:19).) In 

response, the FEC began to consider whether there was “reason to believe” the Fieger 

law firm and its associates had violated section 441f and the agency should open an 

investigation. (Exh. 24 (Wassom Bayes, Dep. 16:20-17:3; 20:20-21:13; 22:5-23:2).) If 

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at least four of the FEC’s six commissioners find that there is “reason to believe” FECA 

was violated, the FEC will open an investigation into the alleged wrongdoing. See 2 

U.S.C. § 437g(a)(2); Shonkwiler, Tr. 153:21-25; 157:9-158:13. “Reason to believe” is a 

minimal standard which is generally assessed on the basis of publicly available 

information. (Shonkwiler, Tr. 158:15-23; Exh. 24 (Wassom Bayes, Dep. 40:4-13).) 

Audra Wassom Bayes was the primary FEC staff attorney assigned to the matter 

regarding the Fieger law firm. (Exh. 24 (Wassom Bayes, Dep. 12:19-13:1.); Shonkwiler, 

Tr. 154:20-23.) 

5. In considering the Fieger law firm matter, FEC staff examined publicly available 

information for evidence that associates of the firm violated section 441f. (Roger 

Hearron, Tr. 45:16-46:8.) The FEC obtained the names of people associated with the 

Fieger firm from the firm’s website, and found from an FEC database of federal 

campaign contributors that many of them and their relatives had made contributions in 

the largest amount allowed by FECA to the 2004 Edwards campaign on one of three 

days. (Exh. 2 (Letter from FEC to Jack Beam dated Sept. 26, 2006 (“J. Beam RTB 

letter”) at p. 3); Exh. 2a (Letter from FEC to Renee Beam dated Sept. 26, 2006 (“R. 

Beam RTB letter”) at p. 3); Hearron, Tr. 75:15-76:2; 77:21-78:1.) In addition, FEC staff 

discovered that many of the contributors had never made federal campaign contributions 

before. (Exh. 2 (J. Beam RTB letter at pp. 3-4); Exh. 2a (R. Beam RTB letter at pp. 3-4); 

Hearron Tr. 75:15-76:2.) 

6. FEC staff found a newspaper article reporting that a former Fieger firm attorney claimed 

that the firm had instructed him and his wife to make contributions to the Edwards 

campaign in 2003 in return for later reimbursement. (Exh. 2 (J. Beam RTB letter at p. 4); 

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Exh. 2a (R. Beam RTB letter at p. 4); Hearron, Tr. 46:13-20.) FEC staff also found that 

the Fieger firm’s principal partner, Geoffrey Fieger, had not denied the reimbursement 

allegations, but had publicly admitted to giving “bonuses” to “civic-minded employees.” 

(Exh. 2 (J. Beam RTB letter at p. 4); Exh. 2a (R. Beam RTB letter at p. 4); Shonkwiler, 

Tr. 160:7-22.) 

7. FEC investigator Roger Hearron found Jack Beam’s name on the Fieger firm’s website. 

(Hearron, Tr. 77:21-24.) The FEC database indicated that Jack Beam and his wife, 

plaintiff Renee Beam, each contributed $2,000 to the Edwards campaign in early 

February 2003. (Exh. 2 (J. Beam RTB letter at p. 4); Exh. 2a (R. Beam RTB letter at 

p. 4); Hearron, Tr. 68:23-69:2; 77:21-78:1; J. Beam, Tr. 187:18-21.) 

8. In June 2006, Jack Beam called his broker, Merrill Lynch, to inquire whether any 

government agency had accessed his account records as part of the ongoing 

investigations. (J. Beam, Tr. 199:22-200:4; 211:18-212:1.) Merrill Lynch responded that 

it could not provide this type of information. (J. Beam, Tr. 356:5-9.) 

D. The FEC’s “Reason to Believe” Finding 

9. In August 2006, the FEC’s Office of General Counsel recommended that the 

Commission find “reason to believe” that the Fieger law firm, Fieger, and over 50 

suspected conduits associated with the firm — including plaintiffs — violated section 

441f. (Exh. 24 (Wassom Bayes, Dep. 13:21-14:1; 25:6-13; 26:16-27:6); Shonkwiler, Tr. 

156:20-157:8.) 

10. The Commission determined by a vote of its members that “reason to believe” existed. 

(Exh. 2 (J. Beam RTB letter at p. 1); Exh. 2a (R. Beam RTB letter at p. 1); Shonkwiler, 

Tr. 156:20-157:8.) On September 26, 2006, the respondents, including plaintiffs, were 

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informed of the FEC’s decision by letter and invited to submit responses. (Exh. 2 

(J. Beam RTB letter); Exh. 2a (R. Beam RTB letter); Exh. 24 (Wassom Bayes Dep. 

27:19-28:10); J. Beam, Tr. 188:10-23.) Each letter was accompanied by a “factual and 

legal analysis” explaining the Commission’s reasoning. (Exh. 2 (J. Beam RTB letter at 

pp. 3-5); Exh. 2a (R. Beam RTB letter at pp. 3-5); Hearron, Tr. 44:15-21; Shonkwiler, Tr. 

161:15-23.) 

11. The factual and legal analysis attached to the FEC’s letters to plaintiffs described the 

evidence FEC staff had found, and stated that “[i]f [plaintiffs] accepted reimbursement 

for [their] contribution[s] to the Edwards committee, then [they] may have violated the 

Act.” (Exh. 2 (J. Beam RTB letter at pp. 3-5); Exh. 2a (R. Beam RTB letter at pp. 3-5).) 

12. In response, plaintiffs denied that they were reimbursed for their contributions. (Exh. 4 

(Letters from J. Beam and R. Beam to FEC dated Oct. 6, 2006 (“Beam response 

letters”)); R. Beam Tr. 116:23-117:2; J. Beam Tr. 193:16-24.) 

E. FEC Interaction with DOJ Begins 

13. Members of the FEC staff interacted periodically with DOJ attorneys involved in the 

Fieger grand jury investigation to share information and coordinate their parallel 

investigations. (Exh. 24 (Wassom Bayes, Dep. 32:22-33:22); Day, Tr. 254:17-255:4.) 

14. M. Kendall Day, a trial attorney with the Public Integrity Section of DOJ’s Criminal 

Division, served as Wassom Bayes’s primary DOJ contact. (Exh. 24 (Wassom Bayes, 

Dep. 34:1-5); Day, Tr. 250:25-251:3; 255:18-24.) Wassom Bayes served as Day’s 

primary FEC contact. (Exh. 24 (Wassom Bayes, Dep. 34:7-10); Day, Tr. 255:15-17.) 

Information about the Fieger investigations transmitted between the two agencies was 

transmitted between Day and Wassom Bayes. (Day, Tr. 269:7-13.) 

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15. DOJ informed the FEC that it could not share any grand jury materials from its Fieger 

investigation due to Federal Rule of Criminal Procedure 6(e). (Exh. 24 (Wassom Bayes 

Dep. 36:4-11; 89:6-12).) 

16. In late 2006 or early 2007, DOJ gave the FEC non-grand jury investigative reports (called 

“302 reports”) drafted by agents of the Federal Bureau of Investigation, and possibly 

comparable reports by agents of the Internal Revenue Service, related to the Fieger 

investigation. (Exh. 24 (Wassom Bayes, Dep. 38:2-22); Day, Tr. 256:3-257:5.) 

F. The FEC Investigation During the Course of the DOJ Investigation 

17. The Commission’s “reason to believe” finding in September 2006 triggered a formal civil 

investigation, called Matter Under Review (“MUR”) 5818, of the Fieger law firm’s 

alleged conduit contribution scheme. (Exh. 24 (Wassom Bayes, Dep. 22:16-23:2); 

Shonkwiler, Tr. 153:14-19, 24-25.) During an investigation, the FEC can engage in 

administrative discovery to determine whether there is enough evidence to support a 

finding that “probable cause” exists to believe that FECA has been violated, a standard 

that is higher than the “reason to believe” standard. See 2 U.S.C. § 437g(a)(4); Exh. 24 

(Wassom Bayes, Dep. 10:7-21; 40:14-20); Shonkwiler, Tr. 158:5-20; 163:15-18. 

18. Although each section 441f case presents unique circumstances, more often than not the 

FEC does not need to obtain the bank records of the alleged conduits to determine if they 

were reimbursed for their federal campaign contributions. (Shonkwiler, Tr. 165:8-22; 

167:4-15.) Often, the alleged reimbursers or conduits admit to the reimbursements. 

(Shonkwiler, Tr. 167:7-12.) Where evidence of reimbursement is needed, the FEC will 

first attempt to obtain the records of the alleged source of the reimbursement (the 

“principal”), which is more efficient than obtaining the records of multiple alleged 

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conduits. (Exh. 24 (Wassom Bayes, Dep. 76:18-77:7); Shonkwiler, Tr. 162:14-24; 

165:17-166:14; 167:4-12.) 

19. In MUR 5818, the Commission did not conduct administrative discovery, pending the 

resolution of DOJ’s criminal investigation. (See, e.g., Exh. 24 (Wassom Bayes, Dep. 

40:14-41:14).) Many of the MUR 5818 respondents requested and received agreements 

to toll the statute of limitations during this period. (Exh. 24 (Wassom Bayes, Dep. 41:11-

42:16); Shonkwiler, Tr. 163:3-9; 168:21-169:10.) Although plaintiffs were not among 

the respondents who requested that the FEC toll the statute, the FEC deferred conducting 

an active investigation as to MUR 5818 generally, including as to plaintiffs. 

(Shonkwiler, Tr. 170:11-24.) The FEC had initially prepared subpoenas for the records 

of the alleged principals in the case: the Fieger law firm, Fieger, Vernon Johnson, and 

possibly their spouses. (Exh. 24 (Wassom Bayes, Dep. 40:21-41:10.) However, those 

subpoenas never issued, and the FEC did not otherwise attempt to obtain evidence of 

reimbursement from the respondents. (Exh. 24 (Wassom Bayes, Dep. 40:21-42:16); 

Shonkwiler, Tr. 163:3-14; 168:21-169:10.) 

20. On March 2, 2007, plaintiffs filed suit against DOJ and the FEC, claiming that DOJ’s 

investigation was unlawful in the absence of an FEC referral pursuant to 2 U.S.C. 

§ 437g(a)(5)(c), and that the FEC illegally conspired with DOJ to delay its civil 

investigation in order to allow DOJ to pursue its own allegedly unlawful criminal 

investigation. (See generally Compl. (Doc. #1).) 

G. The Merrill Lynch Grand Jury Subpoena 

21. DOJ’s grand jury investigation continued in the spring of 2007. (Day, Tr. 280:20-281:7.) 

In May 2007, DOJ served a grand jury subpoena, dated April 24, 2007, on Merrill Lynch 

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to obtain plaintiffs’ records relating to the Cash Management Accounts from which they 

wrote their Edwards campaign contribution checks. (Exh. 18 (Merrill Lynch subpoena 

dated April 24, 2007 (“Merrill Lynch subpoena”)); Day, Tr. 252:8-253:12; J. Beam, Tr. 

207:14-17.) DOJ found no evidence in the Merrill Lynch records or from any other 

source that plaintiffs were reimbursed for their Edwards contributions. (Day, Tr. 263:16-

21; 282:7-283:4.) As a result, DOJ did not use any of plaintiffs’ financial records at the 

Fieger-Johnson criminal trial. (Day, Tr. 263:22-264:1.) 

22. On June 29, 2007, after their original complaint was dismissed, plaintiffs amended their 

complaint and added, among other claims, the instant RFPA claim. (Am. Compl. ¶¶ 14-

29 (Doc. #47).) In their Second Amended Complaint, filed on March 24, 2008 after their 

first Amended Complaint was dismissed (see Mem. Op. and Order dated March 7, 2008, 

(Doc. #90)), plaintiffs alleged more specifically that DOJ and the FEC had violated the 

RFPA when DOJ “secretly obtained plaintiffs’ private banking records” from “Merrill 

Lynch,” and “transmitted such illegally gathered documents to the [FEC].” (Second Am. 

Compl. ¶¶ 15-16, 18 (Doc. #91).) As a result, plaintiffs’ RFPA claim is based on an 

alleged transfer that must have occurred, if at all, before March 24, 2008. (J. Beam, Tr. 

207:6-13.) 

H. Fieger-Johnson Indictment and Trial 

23. In August 2007, a grand jury indicted Fieger and his law firm partner Vernon Johnson for 

violating section 441f. (Day, Tr. 281:18-19; Hearron, Tr. 88:17-24.) The indictment 

alleged that Fieger and Johnson reimbursed various conduits, but plaintiffs were not 

among them. (Day, Tr. 269:14-18; 282:7-11.) About a week after the indictment, Day 

sent a copy of the indictment to the FEC. (Hearron, Tr. 79:2-7.) 

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24. In the spring of 2008, Day worked with FEC attorney Thomas Andersen to determine 

whether Andersen might testify as an expert witness at the criminal trial regarding the 

functions of the FEC and the operation of section 441f. (Thomas Andersen, Tr. 126:24-

127:20; Day, Tr. 257:7-22.) During their first meeting in March 2008, Day showed 

Andersen a sample of the anticipated trial exhibits, which included the checks and bank 

statements of one alleged conduit. (Andersen, Tr. 129:4-13; Day, Tr. 257:23-258:19.) 

These records did not belong to Jack or Renee Beam. (Andersen, Tr. 132:6-133:2.) DOJ 

had only prepared trial exhibits for suspected conduits. (Day, Tr. 258:7-19.) And 

because it had found no evidence that plaintiffs were reimbursed, DOJ did not use 

plaintiffs’ financial records at trial or prepare any exhibits specifically about the Beams. 

(Day, Tr. 263:16-264:1.) Any personal financial information in the anticipated trial 

exhibit that Andersen saw was likely redacted. (Day, Tr. 275:11-18.) Andersen did not 

take these documents from his meeting with Day. (Andersen, Tr. 133:3-6.) 

25. In April 2008, Andersen received a FedEx envelope of materials, including a compact 

disc, from Day. (Andersen, Tr. 133:7-18.) The materials contained publicly available 

information on contributors to the Edwards campaign, including their names, addresses, 

occupations, employers, and the date and amount of their contributions. (Andersen, Tr. 

133:9-134:13; 136:19-137:18.) 

26. Fieger and Johnson’s trial started in April 2008 and concluded in June 2008, when the 

jury acquitted both defendants. (Exh. 24 (Wassom Bayes, Dep. 48:3-13); Day, Tr. 

251:15-23; 258:20-22; 288:16-189:3.) 

27. At trial, Fieger conceded that he and his firm had reimbursed many of the firm’s 

employees and their relatives for their campaign contributions to the Edwards campaign, 

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so the Commission had no need to obtain financial records showing those 

reimbursements for its civil investigation. (Shonkwiler, Tr. 162:5-163:14.) 

I. The DOJ Compact Disc Containing Fieger Trial Materials 

28. Soon after the Fieger-Johnson trial, at the FEC’s request, Day sent Wassom Bayes 

publicly available trial transcripts and exhibits in a compact disc format. (Exh. 24 

(Wassom Bayes, Dep. 48:16-50:8; 83:16-84:1); Shonkwiler, Tr. 179:22-180:1; Day, Tr. 

259:2-23.) The trial exhibits included redacted financial records of suspected conduits, 

but no financial records of the plaintiffs. (Exh. 24 (Wassom Bayes, Dep. 62:16-21); Day, 

Tr. 261:8-262:22; 263:22-264:1.) Wassom Bayes recalled receiving more than one 

compact disc of this public trial material. (Exh. 24 (Wassom Bayes, Dep. 49:19-50:8).) 

She testified that her memory of the precise number may have been based on copies that 

the FEC made after receiving the materials. (Exh. 24 (Wassom Bayes, Dep. 82:16-83:1).) 

29. Hearron obtained this compact disc of Fieger-Johnson trial materials in June 2008. 

(Hearron, Tr. 52:5-22.) During his deposition, Hearron said he recalled receiving a 

second compact disc from DOJ sometime after the FEC sent its “reason to believe” letter 

to plaintiffs; however, at trial Hearron credibly testified that he had been mistaken at his 

deposition, and that the only disc he had received from DOJ was the trial materials disc 

from June 2008. (Hearron, Tr. 55:15-58:10.) 

30. In July 2008, Wassom Bayes was promoted, and FEC staff attorney Phillip Olaya 

assumed primary responsibility for MUR 5818, along with the matter’s staff attorney file, 

which included the DOJ compact disc. (Exh. 24 (Wassom Bayes, Dep. 68:5-17); 

Shonkwiler, Tr. 155:4-11; Phillip Olaya, Tr. 294:4-25; 295:16-19; 299:8-300:4; 303:7-

13; 331:2-6; 331:21-332:2.) Olaya did not see plaintiffs’ financial records on that 

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compact disc or in any other material that came from DOJ while working on MUR 5818, 

although he mistakenly stated in a deposition that he saw plaintiffs’ materials on that 

compact disc. (Olaya, Tr. 304:6-16; 309:12-17.) 

J. The FEC Concludes Its Investigation, Deciding to Take No Further Action 

As to Any of the Alleged Conduits, Including Plaintiffs 

31. By the time Olaya took over for Wassom Bayes in July 2008, the FEC’s Office of 

General Counsel had decided to focus its investigation only on the alleged principals, and 

not the alleged conduits (including plaintiffs), in MUR 5818. (Olaya, Tr. 297:4-298:8; 

340:20-341:4.) 

32. Once the FEC entered into a conciliation agreement with the the Fieger law firm in the 

fall of 2009, the agency sent letters to all of the alleged conduits, including plaintiffs, 

informing them that the FEC had decided to take no further action against them. 

(Shonkwiler, Tr. 168:6-18; Olaya, Tr. 332:4-16; 340:8-15.) 

K. DOJ Did Not Transfer Plaintiffs’ Private Financial Records to the FEC 

33. There is no direct evidence that a transfer of plaintiffs’ financial records between DOJ 

and the FEC took place. Plaintiffs have put forth no documentary evidence showing that 

the FEC obtained their records from DOJ. Likewise, no witness testified that they 

observed DOJ transfer plaintiffs’ financial records to the FEC. Renee and Jack Beam 

have no personal knowledge of any illicit transfer, and Jack Beam testified that his 

evidence of such a transfer was circumstantial. (R. Beam, Tr. 121:10-15; J. Beam, Tr. 

205:12-16; 208:16-22.) Day and Wassom Bayes, the principal contacts between the FEC 

and DOJ in this matter, testified that DOJ never transferred plaintiffs’ private financial 

records to the FEC. (Exh. 24 (Wassom Bayes Dep. 70:1-8); Day, Tr. 264:2-22).) All 

other witnesses also testified that they had no personal knowledge of such a transfer 

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between DOJ and the FEC. (Exh. 22 (Sealander, Dep. 26:6-27:14); Hearron, Tr. 72:11-

73:4; Andersen, Tr. 140:2-4, 9-11; Shonkwiler, Tr. 176:17-177:6; Olaya Tr. 309:12-21.) 

34. Plaintiffs’ circumstantial evidence also fails to demonstrate the alleged transfer. While 

DOJ transferred certain materials to the FEC regarding the Fieger case, there is nothing in 

the record that suggests any of those materials included plaintiffs’ financial records. 

35. The investigative reports Day shared with the FEC in late 2006 or early 2007 were not 

grand jury materials, and there is no evidence they contained financial information of 

plaintiffs. (Exh. 24 (Wassom Bayes, Dep. 38:2-22); Day, Tr. 256:3-257:5.) 

36. The Fieger-Johnson indictment that Day sent to the FEC in August 2007 does not 

reference plaintiffs, let alone contain their financial information. (Day, Tr. 269:14-18; 

282:7-11.) 

37. Day showed Andersen an anticipated trial exhibit containing an alleged conduit’s 

financial records during a meeting in March 2008, but it is undisputed that the records 

related to someone other than plaintiffs. (Andersen, Tr. 132:6-133:2) Indeed, DOJ never 

prepared trial exhibits relating to plaintiffs, since DOJ no longer suspected they were 

conduits as of mid-2007. (Day, Tr. 258:7-19; 263:16-264:1; 282:7-283:4; Exh. 18 

(Merrill Lynch subpoena).) 

38. Plaintiffs have not put forth any evidence disputing Andersen’s testimony that the FedEx 

package of materials he received from Day in April 2008 consisted only of publicly 

available contributor information, and not plaintiffs’ financial records. (Andersen, Tr. 

133:9-134:4; 134:8-13; 137:9-15.) In any event, this transfer took place in April 2008 — 

after plaintiffs’ filed their operative complaint on March 24, 2008 (see Second Am. 

Compl. (Doc. #91)). 

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39. Day transferred a compact disc of Fieger-Johnson trial exhibits and transcripts to the FEC 

after the trial ended in June 2008, but that was well after plaintiffs filed their complaint, 

and in any case the compact disc contains only publicly available trial materials and no 

financial records relating to plaintiffs. (Exh. 1 (DOJ compact disc); Exh. 24 (Wassom 

Bayes, Dep. 48:16-50:8; 62:16-21; 83:16-84:1); Day, Tr. 258:20-22; 259:2-23; 261:8-

262:22; 263:22-264:1.) 

40. In view of the testimony of Day and Wassom Bayes, as well as other evidence indicating 

that no transfer of plaintiffs’ private financial records occurred, FEC attorney Phillip 

Olaya’s deposition testimony that he saw plaintiffs’ financial records on the compact disc 

the FEC received from DOJ containing public Fieger-Johnson trial materials was 

mistaken, and is insufficient to prove a transfer. (Olaya, Tr. 31:11-24.) Moreover, Olaya 

credibly testified at trial that he had erred in stating that plaintiffs’ financial records were 

on this compact disc. (Olaya, Tr. 304:6-305:18; 309:12-17.) In any event, the Court has 

reviewed the disc and confirmed that it contains no financial records of the plaintiffs 

(Exh. 1 (DOJ compact disc)), and plaintiffs put forth no evidence showing that Olaya 

received or saw plaintiffs’ financial records from DOJ in any other way or viewed any 

other compact disc related to MUR 5818. 

41. Hearron’s deposition testimony indicated that he received a second compact disc, but 

Hearron credibly testified at trial that he received only the one disc of public FiegerJohnson trial materials from DOJ. (Hearron, Tr. 52:5-22; 54:21-58:10.) Plaintiffs put 

forth no evidence at trial demonstrating the existence of a second disc, or that this 

supposed second disc contained plaintiffs’ financial records. 

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42. The only evidence that the FEC possessed any of plaintiffs’ financial records is the 

contribution checks that plaintiffs sent to the Edwards campaign; however, it is 

undisputed that the FEC received those checks directly from the Edwards for President 

Committee during a mandatory audit the agency performed pursuant to 26 U.S.C. § 9038, 

and not from DOJ. (Exh. 22 (Sealander, Dep. 23:22-25:20).) 

43. The evidence does not show that the FEC must have obtained plaintiffs’ financial records 

from DOJ in order to carry out the agency’s investigatory duties. 

44. Nothing in the record suggests that the publicly available evidence the FEC collected in 

2006 was insufficient for the Commission to find “reason to believe” that plaintiffs 

violated section 441f. Indeed, it is the FEC’s practice to rely upon publicly available 

evidence at that stage. (Exh. 24 (Wassom Bayes, Dep. 40:4-13).) The claim that Merrill 

Lynch informed Jack Beam in June 2006 that it could not confirm whether a government 

agency had accessed his personal financial records (J. Beam, Tr. 192:13-193:15; 355:14-

356:9) does not show that his records were in fact accessed, or that they were accessed by 

DOJ, or that DOJ then transferred those records to the FEC. 

45. Although DOJ obtained plaintiffs’ financial records with an April 2007 grand jury 

subpoena while the FEC’s investigation was ongoing (Exh. 18 (Merrill Lynch subpoena); 

Day, Tr. 252:8-253:12), the existence of this subpoena does not prove that DOJ in fact 

transferred any records obtained pursuant to it to the FEC. 

46. The evidence shows that the FEC had methods of determining whether the alleged 

conduits were reimbursed without relying on financial records obtained by DOJ. 

(Shonkwiler, Tr. 165:8-22; 167:4-15.) The FEC could have relied upon Fieger’s 

admissions, both in the media and at trial, that he reimbursed his employees (Exh. 2 (J. 

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Beam RTB letter at p. 4); Exh. 2a (R. Beam RTB letter at p. 4); Shonkwiler, Tr. 163:10-

12; 167:7-12), or upon Fieger’s records or the Fieger law firm’s records (Shonkwiler, Tr. 

162:14-24; 165:17-166:14; 167:4-12). Moreover, the FEC, after reason to believe was 

found, could have used its own administrative subpoena power to obtain evidence. (Exh. 

24 (Wassom Bayes, Dep. 10:7-21; 40:14-20); Shonkwiler, Tr. 158:5-20; 163:15-18.) 

47. The evidence suggests that the FEC did not take any significant investigative steps to 

determine whether plaintiffs were reimbursed for their Edwards contributions. After 

finding reason to believe, the FEC took no significant investigative steps in MUR 5818, 

pending DOJ’s criminal investigation. (Exh. 24 (Wassom Bayes Dep. 41:11-42:16); 

Shonkwiler, Tr. 163:3-14; 168:21-169:10; 170:15-24.) By the time the criminal trial 

ended in June 2008, the FEC had decided to focus its investigation on the principals 

rather than the conduits, and plaintiffs were notified of this in November 2009, soon after 

the FEC had entered into a conciliation agreement with the Fieger law firm and ended the 

investigation. (Shonkwiler, Tr. 168:6-18; Olaya, Tr. 332:4-16; 340:8-15.) 

48. There is no evidence that an RFPA certification was prepared in connection with the 

transfers of information from DOJ to the FEC that are relevant to this matter, but there is 

also no evidence that any transfer took place that would have required such a 

certification. 

II. PROPOSED CONCLUSIONS OF LAW 

1. To prove a violation of 12 U.S.C. § 3412(a), the plaintiffs must demonstrate that (1) there 

was a transfer of their private financial materials between federal agencies without a 

certification; (2) the transferred materials were “financial records” covered by the RFPA; 

and (3) the records were “originally obtained pursuant to [the RFPA].” 

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2. Plaintiffs have failed to meet their burden to prove all three elements of their RFPA claim 

by a preponderance of the evidence. 

3. Because the RFPA does not prohibit “the disclosure of financial records in accordance 

with procedures authorized by Title 26,” 12 U.S.C. § 3413(c), the FEC’s receipt of the 

plaintiffs’ contribution checks from the Edwards for President Committee during a 

mandatory audit pursuant to 26 U.S.C. § 9038 cannot be an RFPA violation. 

A. Plaintiffs Failed to Prove That DOJ Transferred Their Private Financial 

Records to the FEC 

4. Plaintiffs have failed to prove by a preponderance of the evidence that DOJ transferred 

any of their financial records to the FEC. (See supra ¶¶ 33-48.) 

5. Because there is no evidence that DOJ transferred plaintiffs’ financial records to the FEC, 

it is irrelevant that there is no evidence of an RFPA certification. 

B. Plaintiffs Failed to Prove DOJ Obtained Their “Financial Records” from a 

 “Financial Institution” 

6. Plaintiffs also failed to prove their RFPA claim because they did not present evidence 

that the records DOJ possessed were “financial records” under the RFPA. 

7. The evidence shows that DOJ obtained plaintiffs’ financial records pursuant to a grand 

jury subpoena DOJ served on Merrill Lynch in May 2007. (Exh. 18 (Merrill Lynch 

subpoena); Day, Tr. 252:8-253:12.) There is no evidence that DOJ obtained plaintiffs’ 

records at any other time or in any other manner. Jack Beam testified that these were 

records of plaintiffs’ Cash Management Account. (J. Beam, Tr. 207:14-17.) 

8. The RFPA is violated only if “[f]inancial records” are transferred improperly. 12 U.S.C. 

3412(a). The RFPA defines “financial record” as “any record held by a financial 

institution pertaining to a customer’s relationship with the financial institution,” or any 

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copy of, or information derived from that record. 12 U.S.C. § 3401(2) (emphasis added). 

“Financial institution” is defined as “any office of a bank, savings bank, card issuer . . . , 

industrial loan company, trust company, savings association, building and loan, or 

homestead association (including cooperative banks), credit union, or consumer finance 

institution, located in [the United States].” 12 U.S.C. § 3401(1). 

9. Plaintiffs put forth no evidence at trial that Merrill Lynch qualifies as a “financial 

institution” under § 3401(1). Plaintiffs must offer more than mere assumption or bald 

assertion that Merrill Lynch qualifies. See Walker v. S.W.I.F.T. SCRL, 491 F. Supp. 2d 

781, 792 (N.D. Ill. 2007) (“Plaintiffs’ conclusory statement that [defendant] ‘acted as a 

financial institution’ [under the RFPA] is not enough to make it so.”). 

C. Plaintiffs Failed to Prove DOJ Possessed Any Records Originally Obtained 

Pursuant to the RFPA 

 

10. Records obtained by grand jury subpoena are exempt from the RFPA, and plaintiffs 

presented no evidence at trial that DOJ obtained any of their financial records other than 

by grand jury subpoena. 

11. Under the RFPA’s grand jury exemption, “[n]othing in th[e RFPA] . . . shall apply to any 

subpena or court order issued in connection with proceedings before a grand jury.” 12 

U.S.C. § 3413(i). 

12. Where “[i]t is undisputed that Plaintiffs’ bank records were received in response to a 

grand jury subpoena[, p]ursuant to § 3413(i), the statutory penalties provided by § 3417 

are inapplicable to Plaintiffs’ claim for violation of § 3412.” Taylor v. Dep’t of the Air 

Force, 18 F. Supp. 2d 1184, 1188 (D. Colo. 1998) (emphasis added), aff’d, 176 F.3d 489 

(10th Cir. 1999) (Table). 

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18 

13. Because plaintiffs failed to prove that DOJ ever obtained their financial records in a way 

that could lead to an RFPA violation, plaintiffs failed to prove such a violation. 

Based on the foregoing proposed findings of fact and conclusions of law, the 

Commission respectfully requests that the Court enter judgment for the Commission.

Respectfully submitted, 

 Phillip Christopher Hughey 

Acting General Counsel 

David Kolker 

Associate General Counsel 

Harry J. Summers 

Assistant General Counsel 

Benjamin A. Streeter III 

Attorney 

/s/ Holly J. Baker 

Holly J. Baker 

Attorney 

September 13, 2010 FOR THE DEFENDANT 

FEDERAL ELECTION COMMISSION 

AND ITS CHAIRMAN 

999 E Street, N.W. 

Washington, D.C. 20463 

(202) 694-1650 

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