UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF ILLINOIS

EASTERN DIVISION

JACK and RENEE BEAM, )

)

Plaintiffs, )

)

v. ) No. 07 C 1227

)

MICHAEL B. MUKASEY, UNITED STATES ) Judge Rebecca R. Pallmeyer

ATTORNEY GENERAL, in his official capacity; )

FEDERAL ELECTION COMMISSION CHAIRMAN )

DAVID M. MASON, in his official capacity; )

UNKNOWN AGENTS OF THE FEDERAL )

BUREAU OF INVESTIGATION, in their )

individual and official capacities, )

)

Defendants. )

MEMORANDUM OPINION AND ORDER

Plaintiffs Jack and Renee Beam (the “Beams”), Illinois residents, claim that the government

targeted them for an investigation in November 2005 because of their support for presidential

candidate John Edwards in the 2004 election. Plaintiffs allege that the United States Attorney

General ordered a raid of the Michigan law office with which Mr. Beam was affiliated, as well as

raids of the homes of some of the law firm’s employees and associates. Plaintiffs further claim that

agents of the Justice Department and/or the FBI seized financial records of the firm’s employees

and associates, including the Plaintiffs. The Beams have brought a three-count complaint against

the Attorney General, the Chair of the Federal Election Commission (the “FEC”) and certain

unknown agents of the Federal Bureau of Investigation (the “FBI”) (collectively, the “Defendants”),

charging them with violating certain federal statutes as well as the United States Constitution.

Defendants have moved to dismiss the complaint. For the reasons given below, the motions are

granted in part and denied in part.

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2

FACTUAL BACKGROUND

For purposes of deciding a motion to dismiss, the allegations of Plaintiffs’ Second Amended

Complaint are accepted as true and viewed in the light most favorable to Plaintiffs. See Tamayo v.

Blagojevich, 526 F.3d 1074, 1081 (7th Cir. 2008). Plaintiffs allege that in February 2003, the

Beams contributed to the 2004 presidential campaign of John Edwards, a Democrat. (2d Am.

Compl. ¶ 7.) A number of employees and associates of the Michigan law firm of Fieger, Fieger,

Kenney & Johnson (the “Fieger law firm”), where Mr. Beam is of counsel, also made contributions

to Edwards during the 2004 election cycle. (Id. ¶¶ 7, 10.)

On November 30, 2005, then-Attorney General Alberto Gonzales authorized a nighttime raid

on the Fieger law firm’s offices. (Id. ¶ 8.) That same evening, approximately 100 federal agents

also raided the homes of certain associates and employees of the Fieger law firm. (Id. ¶ 9.) The

Beams allege that during these raids, federal agents “harassed” the Fieger law firm employees,

asking them who they voted for in the 2004 presidential election and questioning them about their

contributions to the Edwards campaign. (Id. ¶ 11.) During these raids, federal agents also

allegedly informed the Fieger employees that the agents had previously obtained the employees’

financial records. (Id.) Plaintiffs have not alleged that their own residence was raided. They do

assert, however, that at some point after the raids (Plaintiffs do not say when), the Beams learned

that federal agents of the Justice Department and/or the FBI had obtained their financial records.

(Id. ¶¶ 13, 16.) The Beams further allege that their financial records were later (again, on an

unidentified date) transmitted to the FEC. (Id. ¶ 18.) 

On March 2, 2007, Plaintiffs initiated this action by filing an Application for Writ of

Mandamus and Complaint in this court, naming Attorney General Alberto Gonzales and FEC Chair

Robert Lenhard as Defendants. (Docket Entry No. 1.) Pursuant to motions by both Defendants,

on June 22, 2007, the court dismissed Count I of the Complaint–seeking a declaratory judgment

that the Attorney General and the FEC had violated the Federal Campaign Finance Act–for failing

Case 1:07-cv-01227 Document 108 Filed 10/15/2008 Page 2 of 18
3

to allege sufficient facts that would support a right to relief. (Docket Entry No. 46.) The court

reserved ruling on the other two counts of the complaint, in which Plaintiffs had alleged violations

of the Administrative Procedure Act (“APA”) and had sought a writ of mandamus requiring that the

FEC comply with the Federal Campaign Finance Act.

A week later, on June 29, 2007, Plaintiffs filed a five-count Amended Complaint naming

Gonzales, Lenhard, and certain unnamed FBI agents as Defendants, all in their official and

individual capacities. (1st Am. Compl., Docket Entry No. 47.) Plaintiffs alleged violations of the

Right to Financial Privacy Act (“RFPA”), 12 U.S.C. § 3401 et seq.; the Federal Election Campaign

Act (“FECA”), 2 U.S.C. § 431 et seq.; and the APA, 5 U.S.C. § 701 et seq. (Id.) Plaintiffs also

alleged that they were retaliated against for engaging in constitutionally protected activity, and

sought a writ of mandamus compelling the FEC to comply with federal law. (Id.) The FEC and the

Attorney General again moved to dismiss.

On March 7, 2008, this court granted their motions. Beam v. Gonzales, 548 F. Supp. 2d 596

(N.D. Ill. 2008). In so ruling, the court held that the Plaintiffs lacked standing to bring their claims

because the Amended Complaint did not allege any injury-in-fact. Id. at 603. The court also held

that Plaintiffs’ claims were not ripe for judicial review at that time because a federal criminal

investigation into the conduct of the Fieger law firm’s employees was ongoing and the Attorney

General and FEC had “not yet made decisions about whether or how to enforce applicable laws.”

Id. at 605-06. Finally, the court dismissed Plaintiffs’ APA and mandamus claims, concluding that

they failed to allege a violation of FECA because the statute does not clearly limit the Attorney

General’s enforcement authority and because the statute does not authorize courts to “dictate the

timing and nature of an FEC investigation.” Id. at 609-12. The court again permitted Plaintiffs to

file a second amended complaint. Id. at 612.

Plaintiffs did so on March 28, 2008. In their three-count Second Amended Complaint,

Plaintiffs renewed the RFPA (Count I) and retaliation (Count II) claims they alleged in their First

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1 The FEC claims that sovereign immunity prevents the court from exercising subject

matter jurisdiction over both Counts II and III (FEC Mem. [95] at 8-9), while the Attorney General

appears to raise sovereign immunity as a defense only to Count II. (A.G. Mem. [96] at 11 n.5.)

2 The FEC argues that Plaintiffs lack standing to bring Counts I and II (FEC Mem. at

4-8); the Attorney General argues that Plaintiffs lack standing to bring any of the three counts.

(A.G. Mem. at 7-8.)

4

Amended Complaint, and raised for the first time a claim for selective and vindictive prosecution

(Count III). (2d Am. Compl.) David Mason, who replaced Lenhard as FEC Chair, and Michael

Mukasey, who replaced Gonzales as Attorney General, are sued in their official capacities; certain

unknown agents of the FBI are sued in both their official and individual capacities. (Id.) The FEC

and the Attorney General both moved to dismiss Plaintiffs’ Second Amended Complaint. 

While Defendants’ motions have been pending in this court, on June 2, 2008, a federal jury

in Detroit, Michigan acquitted Geoffrey Fieger and Ven Johnson, two partners at the Fieger law firm,

of criminal violations of FECA. See David Ashenfelter & Joe Swickard, Thank You, Jurors, Cleared

Fieger Says, DETROIT FREE PRESS, June 3, 2008, at 3. Fieger and Johnson had been charged with

illegally reimbursing employees and associates of the Fieger law firm for more than $100,000 in

campaign contributions made to the 2004 Edwards campaign. Id.

DISCUSSION

In their motions to dismiss, Defendants argue, first, that the court lacks subject matter

jurisdiction over Plaintiffs’ claims. FED. R. CIV. P. 12(b)(1). According to Defendants, some of

Plaintiffs’ claims are barred by sovereign immunity;1

 Plaintiffs lack standing to pursue at least some

of the claims;2

 and none of the claims are ripe for judicial review. Additionally, Defendants argue

that the complaint should be dismissed pursuant to Rule 12(b)(6), for failing to state a claim on

which relief can be granted.

Case 1:07-cv-01227 Document 108 Filed 10/15/2008 Page 4 of 18
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I. Standard of Review

To withstand a motion to dismiss pursuant to Rule 12(b), a plaintiff must plead facts that

“raise a right to relief above the speculative level.” Bell Atl. Corp. v. Twombly, --- U.S. ---, ---, 127

S. Ct. 1955, 1965 (2007); see also Jennings v. Auto Meter Prods., Inc., 495 F.3d 466, 472 (7th Cir.

2007). The factual allegations, however, need not be detailed, Twombly, 127 S. Ct. at 1964-65,

and the court accepts the well-pleaded allegations of the complaint as true, drawing all reasonable

inferences in favor of the plaintiff. Vill. of DePue v. Exxon Mobil Corp., 537 F.3d 775, 782 (7th Cir.

2008). The 12(b)(6) test thus remains a generous one. In contrast, where Defendants challenge

the court’s subject matter jurisdiction, the court will presume that it “lack[s] jurisdiction unless the

contrary appears affirmatively from the record.” Sprint Spectrum L.P. v. City of Carmel, 361 F.3d

998, 1001 (7th Cir. 2004) (quoting Renne v. Geary, 501 U.S. 312, 316 (1991)). In responding to

Defendants’ arguments concerning ripeness, sovereign immunity, and standing, then, it is the

Plaintiffs’ “responsibility to clearly allege facts that invoke federal court jurisdiction.” Sprint

Spectrum, 361 F.3d at 1001; United Phosphorus, Ltd. v. Angus Chem. Co., 322 F.3d 942, 946 (7th

Cir. 2003) (“The burden of proof on a 12(b)(1) issue is on the party asserting jurisdiction.” (citation

omitted)).

Before applying these standards to the Second Amended Complaint, the court pauses to

note the parties’ apparent agreement that materials not included in the complaint, but attached to

Plaintiffs’ response memorandum, are properly before the court. In deciding a motion to dismiss,

courts are generally limited to considering only the well-pleaded allegations of the complaint. See

FED. R. CIV. P. 12(d); Rosenblum v. Travelbyus.com Ltd., 299 F.3d 657, 661 (7th Cir. 2002). In

their Second Amended Complaint, Plaintiffs have alleged that they have “obtained documentary

proof that federal agents . . . obtained their financial records by engaging in acts and/or omissions

that violate the [RFPA]” (2d Am. Compl. ¶ 16), but do not specifically identify the nature of the

documentary proof. The Attorney General, in his memorandum in support of his motion to dismiss,

Case 1:07-cv-01227 Document 108 Filed 10/15/2008 Page 5 of 18
3 Plaintiffs also attached a grand jury subpoena to their response memorandum that

requests records of the Fieger law firm from the firm’s bank. (Ex. A to Pl.’s Resp.) The court is not

persuaded that this subpoena has any relevance to Plaintiffs’ claims for relief in their Second

Amended Complaint, as it does not concern any RFPA violation relating to the Beams’ own financial

records; does not show retaliation against the Beams; and was not used in a selective or vindictive

prosecution against the Beams. Nor is this Fieger law firm subpoena obviously referenced in the

complaint. The court thus declines to consider this attachment to Plaintiffs’ response

memorandum.

6

acknowledges that federal agents obtained Plaintiffs’ financial records, but pount out that they did

so by means of a grand jury subpoena. (A.G. Mem. at 3.) Plaintiffs apparently concede this: they

have attached to their response memorandum a a copy of the grand jury subpoena, requesting

records of their account from December 2002 through April 2003. (Ex. B to Pl.’s Resp. in Opp’n

to Defs.’ Mots. to Dismiss (hereinafter “Pl.’s Resp.”).) 

Despite the general reluctance of courts to consider matters outside of the pleadings in

deciding a motion to dismiss pursuant to Rule 12(b), courts will nevertheless consider documents

attached to a motion to dismiss if the document is referred to in the complaint itself. Rosenblum,

299 F.3d at 661. Although the grand jury subpoena at issue in this case is not attached to the

motion to dismiss, it is attached to Plaintiffs’ memorandum in response, and is referred to (albeit

indirectly) in the Second Amended Complaint itself. The general principle is thus the same:

Plaintiffs’ complaint refers to “documentary proof” that the government obtained the Beams’

financial records, and both the Defendants and the Plaintiffs appear to agree that the proof consists

of the grand jury subpoena. See Adamczyk v. Lever Bros. Co., 991 F. Supp. 931, 933 (N.D. Ill.

1997) (“a party may assert additional facts in response to a motion to dismiss” as long as the facts

“are consistent with the allegations of the complaint” (citing Travel All Over the World, Inc. v.

Kingdom of Saudi Arabia, 73 F.3d 1423, 1428 (7th Cir. 1996)) The court presumes it is this

subpoena that constitutes the “documentary proof” to which Plaintiffs have referred obliquely in their

complaint.3

I. Ripeness

Case 1:07-cv-01227 Document 108 Filed 10/15/2008 Page 6 of 18
4 Section 2462 provides:

(continued...)

7

At the outset, the court addresses an objection voiced by both Defendants to the court’s

exercise of subject matter jurisdiction over the issues raised in Plaintiffs’ Second Amended

Complaint: whether the case is ripe for judicial consideration. The court dismissed Plaintiffs’ First

Amended Complaint partially on the ground that the issues presented were not ripe. “The question

of ripeness turns on ‘the fitness of the issues for judicial decision’ and ‘the hardship to the parties

of withholding court consideration.’” Pac. Gas & Elec. Co. v. State Energy Res. Conservation &

Dev. Comm’n, 461 U.S. 190, 201 (1983) (quoting Abbott Labs. v. Gardner, 387 U.S. 136, 149

(1967)). Defendants contend that nothing has changed between that complaint and the present

complaint, and that Plaintiffs’ claims are still unripe for review. The court disagrees.

In dismissing Plaintiffs’ First Amended Complaint, the court held that the issues presented

in the complaint were not fit for judicial decision. The principal reason for the finding of unfitness

was the court’s reluctance “to intervene in an ongoing federal criminal investigation” and thereby

interfere with the investigation. Beam, 548 F. Supp. 2d at 606. Specifically, the court noted that

it did not yet know “what, if any, charges may be brought against the Beams.” Id. That is no longer

the case. The grand jury subpoena issued to the Beams’ bank requested documents from

December 2002 through April 2003. (Ex. B to Pl.’s Resp. at 5.) Defendants do not dispute that

FECA’s five-year statute of limitations for criminal sanctions has run. See 2 U.S.C. § 455(a) (“No

person shall be prosecuted, tried, or punished for any [FECA] violation . . . unless the indictment

is found or the information is instituted within 5 years after the date of the violation.”) The FEC

nevertheless maintains that Plaintiffs “may still face potential civil liability for violations of [FECA].”

(FEC Reply [101] at 5.) Although FECA does not contain a statute of limitations for civil liability,

courts that have considered the question have found that the five-year default statute of limitations

provided by 28 U.S.C. § 2462 applies.4

 See, e.g., FEC v. Williams, 104 F.3d 237, 239 (9th Cir.

Case 1:07-cv-01227 Document 108 Filed 10/15/2008 Page 7 of 18
4

(...continued)

Except as otherwise provided by Act of Congress, an action, suit or proceeding for

the enforcement of any civil fine, penalty, or forfeiture, pecuniary or otherwise, shall

not be entertained unless commenced within five years from the date when the

claim first accrued if, within the same period, the offender or the property is found

within the United States in order that proper service may be made thereon.

28 U.S.C. § 2462.

5 The Attorney General does not address the issue of civil penalties at all. He

nevertheless argues that the issues presented by the case are not ripe because the Beams were

not indicted. (A.G. Reply Mem. [102] at 2-3.) The Attorney General appears to concede, however,

that this argument is essentially the same as the argument that Plaintiffs lack standing because

they have suffered no injury. (Id. at 3 (“This argument, however, merely points out Plaintiffs’ lack

of injury.”))

8

1996); FEC v. Christian Coalition, 965 F. Supp. 66, 69 (D.D.C. 1997) (“FECA does not contain an

internal statute of limitations. The applicable statute of limitations is provided under 28 U.S.C.

§ 2462—a point the parties do not, nor could they, reasonably dispute.”). Accordingly, the court

concludes civil penalties against the Beams for the conduct at issue in the government’s

investigation of their financial records would also be barred by the statute of limitations.

The FEC does not explain how Plaintiffs could still be subjected to civil liability, given the

five-year statute of limitations under 28 U.S.C. § 2462.5

 Perhaps the FEC believes that despite the

statute of limitations, it could still seek equitable remedies against the Beams. See Christian

Coalition, 965 F. Supp. at 72 (“[A] suit in equity may lie though a comparable cause of action at law

would be barred.” (quoting Holmberg v. Armbrecht, 327 U.S. 392, 396 (1946))). Even assuming

that the Beams’ conduct would somehow support a claim against them for equitable relief, this court

is unwilling to conclude that such a possibility requires dismissal of this action. Arguably no statute

of limitations applies to equitable actions under FECA at all; thus, under the FEC’s theory, the

FEC’s mere assertion that “investigations into the plaintiffs’ activities are not complete” (FEC Mem.

at 10) and that an equitable claim is under consideration could result in delaying this case as unripe

indefinitely. It appears to the court that no outstanding actions yet to be taken by the FEC or other

events could seriously affect the claims advanced by Plaintiffs in this complaint. See Lucien v.

Case 1:07-cv-01227 Document 108 Filed 10/15/2008 Page 8 of 18
9

Jockisch, 133 F.3d 464, 469 (7th Cir. 1998) (“Concern with the contingency of future events is at

the core of the ripeness doctrine.” (quoting Alcan Alum. Ltd. v. Dept. of Rev., 724 F.2d 1294, 1295

n.1 (7th Cir. 1984))). The remote possibility of a future equitable action cannot preclude a finding

by the court that the issues presented by Plaintiffs in their Second Amended Complaint are fit for

judicial decision.

The second question in the court’s ripeness inquiry is whether Plaintiffs would suffer any

hardship if they were delayed in proceeding in this case. The court previously found that the

Beams could identify no hardship that they would suffer if the criminal investigation into their

activities were to continue. Beam, 548 F. Supp. at 607. Now, however, the FEC appears to have

run out of time to bring either a criminal or civil enforcement action against the Beams. There is

thus no benefit to any of the involved parties in delaying consideration of Plaintiffs’ claims on the

grounds that they are unripe. “The hardship prong under the ripeness doctrine is largely irrelevant

in cases, such as this one, in which neither the agency nor the court have a significant interest in

postponing review.” Elec. Power Supply Ass’n v. F.E.R.C., 391 F.3d 1255, 1263 (9th Cir. 2004).

Defendants’ arguments that Plaintiffs would suffer no hardship from continuing to delay hearing

their claims fail for two reasons. First, Defendants do not acknowledge that the applicable statutes

of limitations under FECA have lapsed and that no strong reasons remain for delaying

consideration of their claims. Second, the “lack of hardship” arguments advanced by Defendants

become, at a certain point, indistinguishable from their substantive arguments that Plaintiffs have

not suffered any cognizable injury. This inquiry is better resolved by determining whether the law

recognizes the injuries alleged by Plaintiffs, rather than having the court refuse to hear the claims

on the grounds that the issues are not ripe for review. As the statutes of limitations have expired

for both criminal and civil penalties arising out of the Beams’ activities in late 2002 and early 2003,

the court concludes that the claims presented in the Beams’ Second Amended Complaint are now

ripe for judicial decision.

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II. Plaintiffs’ Complaint

A. Right to Financial Privacy Act Claims

Defendants argue that Plaintiffs lack standing to bring the RFPA claims. As noted above,

the party invoking federal jurisdiction–here, the Beams–bears the burden of establishing standing.

Freedom From Religion Found., Inc. v. Nicholson, 536 F.3d 730, 737 (7th Cir. 2008). To

demonstrate standing, a party must show “(1) injury-in-fact, (2) causation, and (3) redressability.”

Citizens Against Ruining the Environment v. E.P.A., 535 F.3d 670, 675 (7th Cir. 2008) (citing Lujan

v. Defenders of Wildlife, 504 U.S. 555, 560 (1992)). In the prior decision dismissing Plaintiffs’ First

Amended Complaint, the court found that the Beams had failed to establish that they had suffered

an injury-in-fact. Beam, 548 F. Supp. 2d at 603.

“At the pleading stage, general factual allegations of injury resulting from defendant’s

conduct may suffice” to prove injury-in-fact. Disability Rights Wis., Inc. v. Walworth County Bd. of

Supervisors, 522 F.3d 796, 800 (7th Cir. 2008) (quoting Lujan, 504 U.S. at 561). In their First

Amended Complaint, Plaintiffs alleged that federal agents raided “the homes of the associates and

employees of the Fieger law firm,” but did not allege that their own home was raided or that the

government actually seized their financial records. (1st Am. Compl. ¶ 9.) In the Second Amended

Complaint, by contrast, Plaintiffs allege that federal agents “had, in fact, obtained [the Beams’]

financial records by engaging in acts and/or omissions that violate the Right to Financial Privacy

Act,” and that these “illegally gathered documents” were transmitted to the FEC. (2d Am. Compl.

¶¶ 16, 18.) The question, thus, is whether these allegations suffice to demonstrate injury-in-fact

caused by any of the named Defendants.

The Attorney General argues that Plaintiffs’ allegations that the government accessed their

financial records are not sufficient to establish an injury-in-fact because the supposed injury is not

a “legally-protected interest.” See Plotkin v. Ryan, 239 F.3d 882, 885-86 (7th Cir. 2001). Satisfying

the injury requirement for standing requires a showing that the plaintiff has “suffered an invasion

Case 1:07-cv-01227 Document 108 Filed 10/15/2008 Page 10 of 18
11

of a legally-protected interest” that is real and not hypothetical. Id. (quoting Lujan, 504 U.S. at 560).

The court agrees with the Attorney General that Plaintiffs have alleged no violation of a legallyprotected interest, and hence no injury-in-fact, arising from the government’s investigation of

Geoffrey Fieger, a partner at the Fieger law firm. Plaintiffs’ allegations in their Second Amended

Complaint go beyond this, however, as they claim that federal agents obtained their own financial

records in violation of the RFPA. (2d Am. Compl. ¶ 16.) “It is well settled that a statute itself may

create a legal right, the invasion of which causes an injury sufficient to create standing.” Ramirez v.

Midwest Airlines, Inc., 537 F. Supp. 2d 1161, 1166 (D. Kan. 2008) (citing Warth v. Seldin, 422 U.S.

490, 500 (1975)). The RFPA creates for private citizens a right to sue and recover actual or

statutory damages for violations; the statute thus by its own terms creates a legally-protected

interest. See 12 U.S.C. § 3417(a). In other words, Plaintiffs have standing if they have alleged

facts sufficient to support a reasonable inference that the statute was violated. The injury-in-fact

inquiry, then, blends into an inquiry into the merits of Plaintiff’s allegations, as the Plaintiffs have

alleged a violation of a legally-protected interest only if they have alleged a violation of the RFPA.

Defendants’ 12(b)(1) motions to dismiss for lack of subject matter jurisdiction is thus analyzed along

with the 12(b)(6) motions to dismiss for failure to state a claim. See Peckmann v. Thompson, 966

F.2d 295, 297 (7th Cir. 1992) (“If a defendant's Rule 12(b)(1) motion is an indirect attack on the

merits of the plaintiff's claim, the court may treat the motion as if it were a Rule 12(b)(6) motion to

dismiss for failure to state a claim upon which relief can be granted.” (citing Malak v. Associated

Physicians, Inc., 784 F.2d 277, 280 (7th Cir. 1986))).

Plaintiffs’ conclusory statement that federal agents violated the RFPA does not by itself

satisfy the pleading standards, even under the generous standards applied to a motion to dismiss

under Rule 12(b). See Twombly, 127 S. Ct. at 1966. Instead, the court looks at the facts

supporting this conclusory assertion–namely, the grand jury subpoena–to determine whether the

issuance of the subpoena supports a finding that the government violated the RFPA. Defendants

Case 1:07-cv-01227 Document 108 Filed 10/15/2008 Page 11 of 18
6 The subpoena states, in pertinent part: 

The government requests that your institution not provide any infor-mation [sic]

about this grand jury subpoena to any third party–including the affected

accountholder(s)–for a period of 90 days. Federal law permits but does not require

you to comply with this request for nondisclosure. See 12 U.S.C. § 3413(i).

However, any disclosure to third parties could impede the investigation being

conducted and thereby interfere with the enforcement of federal criminal law.

Ex. B to Pl.’s Resp. at 2.

12

insist that obtaining the information by means of a grand jury subpoena does not violate the RFPA.

Section 3413(i) reads:

Nothing in this title (except sections 1115 and 1120 [12 USCS §§ 3415 and 3420])

shall apply to any subpoena or court order issued in connection with proceedings

before a grand jury, except that a court shall have authority to order a financial

institution, on which a grand jury subpoena for customer records has been served,

not to notify the customer of the existence of the subpoena or information that has

been furnished to the grand jury, under the circumstances and for the period

specified and pursuant to the procedures established in . . . 12 U.S.C. § 3409.

12 U.S.C. § 3413(i). The Beams argue that the second exception clause (“except that a court shall

. . .”) requires the government to “follow the statutory procedures outlined in § 3409 to seal the

existence of a grand jury subpoena served on a financial institution” (Pl.’s Resp. at 4), a procedure

which was admittedly not followed here.6

 

Plaintiffs’ reading of the statute is defeated by the plain language of the Act. The RFPA

strikes a balance between customers’ right to financial privacy and law enforcement’s legitimate

need for private financial records. See In re Grand Jury Subpoena, 41 F. Supp. 2d 1026, 1032 (D.

Alaska 1999). In particular, grand jury subpoenas were exempted from the reporting requirements

of the statute. The clause on which Plaintiffs rely grants courts the authority to order a financial

institution to withhold customer notification pursuant to the RFPA despite the existence of a grand

jury subpoena, but does not, as Plaintiffs suggest, require the government to go through this

procedure. All that the second exception clause does is permit courts to institute “gag orders”

pursuant to § 3409 when the disclosure is pursuant to a grand jury subpoena–a provision that might

be characterized as an excess of caution, as the introductory language to the section states that

Case 1:07-cv-01227 Document 108 Filed 10/15/2008 Page 12 of 18
7 Additionally, Plaintiffs cannot successfully assert this claim against the unknown FBI

agents named by Plaintiffs in their Second Amended Complaint because § 3417(a), by its own

terms, authorizes suits only against federal agencies and departments and financial institutions, not

individuals. 12 U.S.C. § 3417(a); see also Liffiton v. Keuker, 850 F.2d 73, 78-79 (2d Cir. 1988).

8 Plaintiffs have not specifically alleged a violation of § 3412 by identifying the specific

provision, but their argument clearly focuses on this provision. The complaint alleges that the

Attorney General and his agents transmitted the financial records to the FEC in violation of the

RFPA (2d Am. Compl. ¶¶ 18-20), and they advance the same argument in their memorandum in

opposition. (Pl.’s Resp. at 8.) The failure to specifically identify the precise statute is irrelevant in

deciding a motion to dismiss, as the Plaintiff has only the burden of establishing a general right to

(continued...)

13

the RFPA does not apply to such subpoenas at all. Plaintiffs cite no authority to support their

reading of the statute, and the court is aware of none. See Pleasant v. Lovell, 876 F.2d 787, 806

(10th Cir. 1989) (“Under the Act, there is no requirement that a bank notify its customer of a grand

jury subpoena.”); In re Grand Jury Subpoena, 41 F. Supp. 2d at 1032 (“[F]ederal grand jury

subpoenas were specifically exempted from the provisions of the RFPA requiring notice to

customers.”). Indeed, Plaintiffs made this same argument in the Michigan district court that

supervised the Feiger grand jury investigation, and the court rejected it. (See Trans. of Aug. 15,

2007, Ex. A to Def. Attorney General’s Reply Mem. in Supp. of His Mot. to Dismiss [66] at 59.)

Therefore, the government did not violate the RFPA by obtaining the Beams’ financial records

pursuant to a grand jury subpoena, which means the Plaintiffs have suffered no injury to a legallyprotected interest as a result of the Attorney General’s conduct and have failed to state a claim

upon which relief can be granted.7

The Plaintiffs’ claim against the FEC stands on a different footing, however. Section 3417

of the RFPA prohibits “any agency or department of the United States . . . [from] obtaining financial

records or information contained therein in violation of [the RFPA].” Another section of the Act,

§ 3412, provides that financial records “originally obtained pursuant to this title shall not be

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

a written certification that the records are needed for legitimate law enforcement needs.8

 12 U.S.C.

Case 1:07-cv-01227 Document 108 Filed 10/15/2008 Page 13 of 18
8

(...continued)

relief rather than setting forth the precise legal theory under which he is proceeding. See Vidimos,

Inc. v. Laser Lab Ltd., 99 F.3d 217, 222 (7th Cir. 1996) (“The Federal Rules of Civil Procedure do

not require a plaintiff to plead legal theories.”). Plaintiffs’ general invocation of the RFPA, which

includes § 3412, is therefore sufficient.

14

§ 3412(a). An agency that obtained financial records from another department or agency could

thus be liable under § 3417, even if the original agency obtained the documents legally. Thus,

although Plaintiffs’ allegations that the Attorney General obtained their financial records illegally

fails, the FEC could still be liable for obtaining the documents in violation of the RFPA if they

obtained the records from the Department of Justice without following the procedures outlined in

§ 3412. Reading these two sections together, then, Plaintiff has adequately alleged the FEC has

obtained these documents in violation of the RFPA. 

The FEC claims that this court’s prior opinion, which dismissed the Plaintiffs’ RFPA claim

in the First Amended Complaint against the FEC as “unsubstantiated speculation,” Beam, 548 F.

Supp. 2d at 604, defeats this new complaint as well. Again, the court disagrees. In the Second

Amended Complaint, unlike the First Amended Complaint, Plaintiffs specifically allege that the FEC

received these documents. (2d Am. Compl. ¶ 18.) While it is true that Plaintiffs still do not have

actual physical proof that the FEC obtained these documents in violation of the RFPA, the Plaintiffs

are not required to possess definitive proof at this stage. U.S. Gypsum Co. v. Ind. Gas Co., Inc.,

350 F.3d 623, 628 (7th Cir. 2003) (“The right question is whether it is possible to imagine proof of

the critical facts consistent with the allegations actually in the complaint.”). The FEC places undue

emphasis on the “unsubstantiated speculation” language of the court’s prior opinion; the First

Amended Complaint at issue in that case did not clearly allege that the FEC in particular (as

opposed to the “government” as one singular entity) had done anything wrong, so the Plaintiffs

were essentially requiring the court to speculate not just as to facts but as to what the complaint

alleged. By contrast, Plaintiffs’ Second Amended Complaint pleads what the First Amended

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15

Complaint did not. Although not all the facts alleged by Plaintiff are proven prior to discovery, the

court accepts as true well-pleaded allegations of the complaint for purposes of a motion to dismiss.

Tamayo, 526 F.3d at 1081. If Plaintiffs still lack any evidence that an RFPA violation occurred after

they have had the chance to engage in discovery, summary judgment in favor of the FEC may well

be appropriate. But at this preliminary stage, Plaintiffs have adequately pleaded a cause of action

under the RFPA against the FEC, and so the court denies the FEC’s 12(b)(1) and 12(b)(6) motions

as to this claim.

B. Retaliation

Defendants argue that Plaintiffs’ second count, for “retaliation and deprivation of First

Amendment rights to free speech,” is both barred by sovereign immunity and fails to state a claim.

The Second Amended Complaint alleges that the investigation of the Beams’ private financial

records “was carried out to instill fear and retaliation for Plaintiffs’ exercise of their political activities

and support for Democratic candidates and without serving any legitimate law enforcement

purpose.” (2d Am. Compl. ¶ 24.) The Beams have named Mukasey and Mason as defendants in

their “official capacities” only, however, and sovereign immunity bars “suits brought against the

United States and its officers acting in their official capacity.” Davis v. U.S. Dep’t of Justice, 204

F.3d 723, 726 (7th Cir. 2000). To proceed with this action, then, Plaintiffs must identify “federal law

that waives the sovereign immunity of the United States to the cause of action.” Clark v. United

States, 326 F.3d 911, 912 (7th Cir. 2003). In their memorandum in opposition to the motions to

dismiss, the Beams argue that this count is authorized as a Bivens-type action, which allows

plaintiffs to recover money damages for certain violations of constitutional rights. See Bivens v. Six

Unknown Named Agents of the Federal Bureau of Narcotics, 403 U.S. 388, 397 (1971). That

theory is inapplicable here, however, because “[a] Bivens action may not be maintained against []

federal employees in their official capacities.” Neville v. True, 900 F. Supp. 972, 978 (N.D. Ill. 1995)

(citing Ecclesiastical Order of the Ism of Am, Inc. v. Chasin, 845 F.2d 113, 116 (6th Cir. 1988)). The

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9 Defendants also argue that Plaintiffs lack standing to pursue this claim because

Plaintiffs have not suffered any injury-in-fact as a result of the alleged retaliation. As with the RFPA

claim, this argument is indistinguishable from whether Plaintiffs have stated a claim upon which

relief can be granted, because there is no injury if the second element of the cause of action is not

met. The court therefore evaluates the sufficiency of the Beams’ claim for relief. See Peckmann,

966 F.2d at 297.

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doctrine of sovereign immunity thus prevents this claim from being pursued against either

Defendant Mukasey or Defendant Mason in their official capacities.

In any event, Count II fails to state a claim upon which relief can be granted and must be

dismissed under Rule 12(b)(6), even with respect to the unknown FBI agents. At the outset, the

court notes that Plaintiffs cite no case law supporting the notion that being subject to a retaliatory

investigation lends itself to a Bivens action. See Hartman v. Moore, 547 U.S. 250, 262 n.9 (2006)

(“No one here claims that simply conducting a retaliatory investigation with a view to promote a

prosecution is a constitutional tort.”). Even assuming that such a cause of action exists, however,

Plaintiffs have failed to adequately plead the elements of a retaliation claim. The elements of a First

Amendment retaliation claim are that (1) a plaintiff engaged in constitutionally protected speech,

(2) the plaintiff “suffered a deprivation likely to deter free speech,” and (3) his speech was a

motivating factor in the decision to retaliate. See Massey v. Johnson, 457 F.3d 711, 716 (7th Cir.

2006). While making campaign contributions and vocally supporting a presidential candidate

undoubtedly constitute protected speech, see Buckley v. Valeo, 424 U.S. 1, 15 (1976), the Beams

have failed to adequately allege the second element, namely, how the deprivation that they

suffered—being subjected to a political investigation–was likely to deter their speech.9

 The

Plaintiffs concede—and, indeed, they rest their entire RFPA claim upon the notion–that Defendants

sought to actively conceal from them that they were investigating their financial records. But a party

trying to “instill fear and retaliation” (2d Am. Compl. ¶ 24) would not want its actions concealed from

the party whose speech it is trying to deter; rather, the party trying to deter speech would want its

actions well known. Indeed, the whole concept of deterrence rests upon the notion that the public

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17

penalty for the protected speech will dissuade similar speech or activity by others. Count II thus

fails to state a claim upon which relief can be granted.

C. Selective and Vindictive Prosecution

Plaintiffs’ Second Amended Complaint alleges, for the first time, a deprivation of the Beams’

right to be free from selective and vindictive prosecution. The Fifth Amendment protects the right

of citizens to not be singled out for prosecution for improper purposes. See Wayte v. United States,

470 U.S. 598, 608 (1985) (“[A]lthough prosecutorial discretion is broad, it is not unfettered.

Selectivity in the enforcement of criminal laws is . . . subject to constitutional constraints.” (internal

quotations omitted) (citing United States v. Batchelder, 442 U.S. 114, 125 (1979))). Likewise, the

Constitution prohibits vindictive prosecutions “undertaken in retaliation for the exercise of a legally

protected statutory or constitutional right.” United States v. Cyprian, 23 F.3d 1189, 1196 (7th Cir.

1994) (citing United States v. Dickerson, 975 F.2d 1245, 1250-51 (7th Cir. 1992)).

An essential element of a selective or vindictive prosecution claim is that a prosecution must

take place. A “prosecution” is “a criminal action; a proceeding instituted and carried on . . . for the

purpose of determining the guilt or innocence of a person charged with crime.” BLACK’S LAW

DICTIONARY 1221 (6th ed. 1991). Plaintiffs concede not only that no criminal action has been

brought against them, but that no such action can be brought because the five-year statute of

limitations for criminal actions under FECA has expired. (Pl.’s Resp. at 13.) The Beams have thus

not been prosecuted, and, a fortiori, could not have been selectively or vindictively prosecuted.

Plaintiffs’ contention that dismissal of this claim means that “the government can harass, threaten,

intimidate, retaliate, and conspire against American citizens” so long as they are ultimately not

indicted is clearly incorrect. (Id. at 12.) The court’s holding that these facts do not support claims

for selective and vindictive prosecution does not preclude the possibility that other relief may be

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10 The court has no need to consider Defendants’ arguments that Plaintiffs also lacked

standing and were barred by sovereign immunity from bringing this count.

18

available. Plaintiffs’ selective and vindictive prosecution count is therefore dismissed for the simple

reason that they have not been prosecuted.10

CONCLUSION

For the foregoing reasons, Defendant Mukasey’s Motion to Dismiss [96] is granted.

Defendant Mason’s Motion to Dismiss [95] is denied as to Count I and granted in all other respects.

ENTER:

Dated: October 15 , 2008 _________________________________________

REBECCA R. PALLMEYER

United States District Judge

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