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On October 10, 2007, Plaintiffs filed a timely Notice of Appeal.

STANDARD OF REVIEW

This Court reviews de novo the district court’s dismissal of a complaint
under Fed. R. Civ. P. 12(b)(6). Taxpayers United for Assessment Cuts v. Austin,

994 F.2d 291, 296 (6th Cir. 1993). In its de novo review, the Court must treat

= all of the well-pled allegations of the complaint as true. Bower v. Federal

Express Corp., 96 F.3d 200, 203 (6th Cir. 1996). As this Court has aptly stated,
“Our review is essentially the same as the district court’s; We ‘take the
plaintiff's factual allegations as true and if it appears beyond doubt that the
plaintiff can prove no set of facts in support of its claims that would entitle it to
relief, then . . . dismissal is proper.’” Forest v. United States Postal Sery., 97
F.3d 137, 139 (6th Cir. 1996)(quoting American Eagle Credit Corp. V. Gaskins,

920 F.2d 352, 353 (6th Cir. 1990).

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claim is properly cognizable in court but contains some issue within the special

competence of an administrative agency.”).

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The doctrine of primary jurisdiction is designed to promote comity
between courts and administrative agencies and applies with equal force to both

civil proceedings and criminal prosecutions. See United States v. Pacific &

Mo} + TELEPHONE 124x258 5855

Arctic Co,, 228 U.S. 87, 106-08 (1913); United States v. Alaska Steamship Co.,
110 F. Supp. 104, 111 (Dist. D.C. 1952). In Haun, the Sixth Circuit
emphasized that:

‘Primary jurisdiction,’ .. . applies where a claim is
originally cognizable in the courts, and comes into
play whenever enforcement of the claim requires the
resolution of issues which, under a regulatory scheme,
have been placed within the special competence of an
administrative body; in such a case the judicial
process is suspended pending referral of such issues
to the administrative body for its views.

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Haun, 124 F.3d at 749 (quoting United States v. Western Pac. R.R.,352 U.S.59,
63-64 (1956)). Here, Congress expressly delegated to the FEC the sole statutory
responsibility to issue advisory opinions as to whether certain conduct or
transactions fell within the scope of the Act, and promulgate rules “necessary to
carry out the provisions of th[e] Act” and to “encourage voluntary compliance

22” 2USC. § 437d.

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In Hoffman v. United States, 341 U.S. 479, 488 (1951), the Supreme
Court emphasized that “[t]he privilege afforded [under the Fifth Amendment]
not only extends to answers that would in themselves support a conviction under
a federal criminal statute but likewise embraces those which would furnish a dink
in the chain of evidence needed to prosecute the claimant for a federal crime.”
Id. at 486 (citing Blau v. United States, 340 U.S. 159 (1950)). By disregarding
the congressionally mandated sequence that the FEC proceed first [and that the
Attorney General proceed only after a referral] the Attorney General is
effectively making the Fifth Amendment an absolute impediment to the FEC’s
ability to carry out its investigative and resolution functions.

In United States v. Grable, 98 F.3d 251 (6th Cir. 1996), the Sixth Circuit
refused to uphold a civil contempt order against a taxpayer who asserted his
Fifth Amendment privilege in response to an IRS summons. In Grable, the IRS
issued a compulsory summons for failure to file federal income tax returns. At
acontempt hearing, the taxpayer asserted his Fifth Amendment privilege against
compulsory self-incrimination. The district court refused to recognize the
taxpayer’s Fifth Amendment right in response to the IRS summons and held him
in contempt of court. The Sixth Circuit reversed and held that the taxpayer’s

failure to file a tax return constituted a crime and thus “the prospect of a

-28-



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FILGER FIEGER KENNEY JOHNSON & GIROLX + APROFESSIOVAL CORPORATION + ATTORNEYS AND COUASLLORS AT LAW + 1940 WEST TEN MILE ROAD + SOL THFIFID MICIIGAS WSOPS.249T * TELEPHONE uty 255 5566

Here, Plaintiffs are suffering through an extra-jurisdictional and unconstitutional
investigation because the FEC failed [or is unable] to comply with the law. At
the same time, the Attorney General is violating the law and interfering with the
FEC’s ability to do its statutorily mandated job.

Under § 706 of the APA, “the reviewing court shall compel agency action
unlawfully withheld or unreasonably delayed.” The United States Supreme
Court has interpreted the word unlawfully in § 706 to mean that under the APA
a federal court can only compel agency action that is “legally required.” Norton
v. Southern Utah Wilderness Alliance, 542 U.S. 55, 63 (2004). The first step in
the analysis under an APA claim is to identify a relevant federal statute that
requires an action to be taken by a federal agency.

In this case, the relevant federal statute upon which Plaintiffs rely in
bringing their APA claim is 2 U.S.C. § 437g(a}(2). Section 437g(a)(2)
commands that, once the FEC has found reason to believe that a violation of the
Act has been committed, the “Commission shall make an investigation of such
alleged violation.” Thus, § 437(g)(2) requires the FEC to follow the statute and
conduct an investigation after finding reason to believe that Plaintiffs may have

violated the Act. The FEC has failed to do so.

-37-



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+ ATTORNEYS AND COUNSELORS ATLAB + 100 WEST FEN MILE ROAD + SOUTHPIFED MICHIGAN 4ai175 2467 «TEL FPIONL 124

FIFGER. PIEGER KENNEY JOHNSON & GIROUX + A PROD ESSIONAL CORPORATION

and providing a mechanism by which the FEC could refer certain matters to the
Attorney General after it exercised its exclusive jurisdiction.

The Attorney General and FEC are proposing that the Court interpret the
Act so as to provide the FEC with exclusive civil jurisdiction but only to the
extent that the Attorney General has not begun its own investigation. In other
words, the government seeks to re-write the statute so that the Attorney General
and FEC have concurrent jurisdiction, but such an interpretation is contrary to
the plain language of the statute.

The referral provision of the statute further supports Plaintiffs’ assertion
that the Act sets forth a sequence under which the FEC exercises its jurisdiction
first, and the Attorney General only after receiving a referral. Congress
incorporated sucha specific referral mechanism to prevent politically motivated

or uneven application and enforcement of the Act. Specifically, Congress

'The government suggests that Plaintiffs’ arguments represent a “radical”
change inthe law. Respectfully, Plaintiffs disagree. For more than 30 years, the
FEC has resolved, civilly, about 99.9% of campaign finance disputes without the
interference or intervention of the Attorney General. In fact, there have only
been a handful of criminal campaign finance cases brought by the Attorney
General, and even less have ever actually been tried before a jury. So in reality,
the only “radical” change proposed here is by the Attorney General. The fact
that there have been so few criminal campaign finance cases in 30 years explains
why the jurisdictional requirements of the Act, raised herein, have gone
unaddressed.

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DESIGNATION OF APPENDIX CONTENTS

RECORD

DESCRIPTION OF ENTRY DATE ENTRY NO.
Docket Sheet n/a n/a
Application for Writ of Mandamus and
Complaint 02/05/2007 RI
Motion for Declaratory Judgment and Writ 02/07/2007 RA
of Mandamus

Exhibit A: 2/1/2006 Itr. to Michael Toner

Exhibit B: FEC ltrs. to Fieger and Fisher
Order denying Motion to Voluntarily
Dismiss Without Prejudice 08/08/2007 R.32
Order and Opinion denying [4] Motion for
declaratory judgment, denying as moot [12]
Motion for limited discovery, granting [15]
Motion to dismiss, and granting [19] Motion
for summary judgment 08/15/2007 R.33
Judgment 08/15/2007 R.34
Notice of Appeal 10/10/2007 R.35

-47-



Case No. 07-2291

UNITED STATES COURT OF APPEAL
FOR THE SIXTH CIRCUIT

(On Appeal from the United States District Court,
Eastern District of Michigan, Civil Action No. 07-10533
the Honorable Lawrence P. Zatkoff)

GEOFFREY N. FIEGER; NANCY FISHER;
FIEGER, FIEGER, KENNEY AND JOHNSON, P.C.,

Plaintiffs-Appellants,

vs.

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U.S. ATTORNEY GENERAL ALBERTO R. GONZALES;
FEDERAL ELECTION COMMISSION CHAIRMAN
MICHAEL E. TONER, in their official capacities,

Defendants-Appellees.

CERTIFICATE OF COMPLIANCE

I hereby certify that the foregoing brief complies with the type-volume
limitation provided in F.R.A.P. 32(a)(7)(B). The foregoing brief contains 9,501

words of Times New Roman New (14 point) proportionate type.

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Michael R. Dezsi (P64530)

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so now the problem comes full circle; the Attorney General has ignored the
jurisdictional requirements of the statute, and as a result the FEC has failed to
comply with its congressionally mandated duties. Defendants’ only method to
cure their disregard for the law is to make untenable legal arguments like the
argument adopted in Stockman.

To remedy this exact problem, congress provided the federal courts with
a powerful tool — the mandamus statute— to compel agencies like the FEC to
follow the statutory requirements of the law. Under 28 U.S.C. § 1361, a federal
district court has original jurisdiction over any action in the nature of mandamus
“to compel an officer or employee of the United States . .. to perform a duty
owed to the plaintiff.” Here, the FEC owe Plaintiffs a mandatory,
nondiscretionary duty to conduct its investigation in the first instance. The FEC
has failed to perform this duty and should be compelled to do so.

CONCLUSION AND RELIEF SOUGHT

The Federal Election Commission has primary and exclusive jurisdiction
over the Federal Election Campaign Act. Only by an affirmative vote of a
majority of four members may the Commission refer to the Attorney General

knowing and willful violations of the Act. Without a referral by the FEC, the

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+ TRL FPHONE (245) 385-8585

+ SOLTHHLLD MICHIGAN 1N075.2163

ATTORNEYS AND COUNSELORS ATI AW + 19290 WEST TEN MULE ROAD

FIFGER. PILGER, KENNEY, JOHNSON & GIROLY + § PROFESSIONAL CORPORATION +

federal penal code. Federal Election Campaign Act Amendments of 1976, Pub.
L. No. 94-283; 90 Stat. 475. For example, before the 1976 amendments, 18
U.S.C. § 608 provided a limit on individual political contributions. Congress
repealed 18 U.S.C. § 608 (along with several other provisions of title 18) and
shifted this provision to the Federal Campaign Finance Act, 2 U.S.C. § 441a.
90 Stat. 486-87. Congress also made unlawful contributions or expenditures by
national banks, corporations, and labor organizations. 90 Stat. 490 (currently
codified at 2 U.S.C. 441b).

In addition to the substantive restrictions on campaign finance, Congress

also restructured the makeup of the FEC to be “composed of the Secretary of the

Senate and the Clerk of the House of Representatives, ex officio and without the
right to vote, and 6 members appointed by the President of the United States, by |
and with the advice and consent of the Senate.” 90 Stat. 475 (currently codified
at 2 U.S.C. 437c). ‘Yo ensure that the FEC’s decisions remained neutral,

bipartisan and non-political, Congress further commanded that “[nJo more than

3 members of the Commission appointed under this paragraph may be affiliated

with the same political party.” 90 Stat. 475.

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Ifthe Attorney General were permitted, in the first instance, to investigate
and prosecute without a referral from the FEC, the value of the Commission’s
practices and rules designed to promote voluntary compliance and avoid the
rigors of litigation would be gutted. Arkansas Best Corp. v. Comm’r of Internal
Revenue Serv., 485 U.S. 212 (1988)(an interpretation of a statutory provision
that renders another superfluous cannot be correct).

The following example best illustrates this point: the Attorney General
issues an indictment while at the same time the FEC is drafting an advisory
opinion as to whether the conduct forming the basis of the indictment is
proscribed by the Act. In these circumstances, the courts must ordinarily defer
to the rule making authority of the FEC under the doctrine of primary
jurisdiction. United States v. Philadelphia Nat'l Bank, 374 U.S. 321, 353
(1963)(primary jurisdiction “requires judicial abstention in cases where
protection of the integrity of a regulatory scheme dictates preliminary resort to
the agency which administers the scheme”).

Ifthe Attorney General could proceed unfettered without referral from the
FEC, the Attorney General’s prosecutions would constantly be at odds with
courts who must defer jurisdiction of the matter to the FEC as the administrative

agency exclusively possessed with the exclusive implementation and

-33-



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virtually all campaign finance cases have been resolved by the FEC. In the
history of the United States, no case resembling the facts here has ever been
criminally charged or tried to a verdict before a jury.

Congress clearly understood that their members were the very persons
who could be targeted by a politically motivated Justice Department. For this
reason, Congress devised a statutory formula to place all campaign finance
matters first within the administrative aegis of the FEC. Also significant is the
fact that in 1976 Congress created a mechanism by which “the Commission”
could refer to the Attorney General knowing and willful violations of the Act.
This provision demonstrates congressional intent to administratively funnel a//
alleged violations of the Act first through the FEC, without interference from the
Attorney General. It was exactly for this reason that Senator Brock opposed the
1976 amendments. As Senator Brock correctly recognized, under the 1976
amendments, “the Justice Department is no longer able to prosecute on its own.
[Instead, the Attorney General] . . . must refer the case to the Federal Election
Commission.” 122 Cong. Rec. S. 12471 (1976). That is the law, and is has been

violated here.

-26-



ARGUMENT

I. The Federal Election Commission Has Primary and Exclusive
Jurisdiction Over the Federal Election Campaign Act. Only By An
Affirmative Vote of a Majority of Four Members May the
Commission Refer to the Attorney General Knowing and Willful
Violations of the Act. Without a Referral By the FEC, the Attorney
General Has No Jurisdiction to Investigate or Prosecute Suspected
Campaign Finance Violations.

Se PAN DS) IEE STIS

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Generally, the United States Attorney General’s authority to prosecute
suspected crimes is plenary except where Congress has provided an expression
of its legislative will to restrict the jurisdiction of the Attorney General. United
States v. Morgan, 222 U.S. 274 (19112 The Federal Election Campaign Act

(FECA’, or ‘Act’ ) is one example where Congress has clearly stripped the

? In Morgan, the Supreme Court found that the Attorney General shared
parallel jurisdiction with the Department of Agriculture based on the Pure Food
and Drug Act of 1906 which expressly provided that the Attorney General could
initiate proceedings based on a report from either the Secretary of Agriculture
or any health or food or drug officer or agent of any State. See Pure Food and
Drug Act of June 30, 1906, ch. 3915, sec. 5, 34 Stat. 768, 769 (1906). Given
that the statute expressly recognized the Attorney General’s ability to prosecute
without a referral, the Morgan Court refused to limit the Attorney General’s
prosecutorial powers to cases referred by the Department of Agriculture. Here,
unlike the statute considered in Morgan, the Federal Election Campaign Act
does notallow the Attorney General to independently prosecute violations of the
Act without a referral from the FEC. In fact, as demonstrated herein, the entire
statutory scheme of the FECA would be preempted and rendered nugatory if the
Attorney General shared with the FEC primary jurisdiction over the Act.

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HIFGER, FIEGFR KENNEY, JOHNSON & GIROUX + \PRUFFSSIONAL CORPORATION + AFTORNEYS AND COUASFLORS ALL AM © RUD WESTTEN MEP ROAD + SOUTHFIELD, MICHIGAN <s7=



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SOLES TEN MILE ROAD,

FIFGLR TIEGER KENNEY, JOHNSON & GIROLA + 4 PROFESSIONAL CORPORATION + SFIORNEYS AND COUNSELORS ALLAM. +

122 Cong. Rec. S. 12471 (1976). That is the correct interpretation of the statute.
Senator Brock correctly recognized that it was the specific intent of Congress, :
of which he was an elected member, to prevent the Attorney General from
independently prosecuting FECA violations without first receiving a referral
from the FEC.

In 1979, the Ninth Circuit considered for the first and only time whether
the Attorney General could independently prosecute violations of the Act
without referral from the FEC under the 1976 law. United States v. Int'l Union
of Oper. Engineers, Local 701, 638 F.2d 1161 (9th Cir. 1979). There, the court
concluded, based upon the then existing language of the 1976 law, that the
Attorney General could prosecute alleged violations of the Act without first
receiving a referral from the FEC. Significantly, however, the Ninth Circuit’s
erroneous opinion has now been superceded by subsequent amendment to the
Act in 1980.

C. The Ninth Circuit’s Opinion in Jnt’l Union has been
superceded by the 1980 Amendments to the Act.

In 1980, and after the Ninth Circuit’s decision in /nt’! Union, congress
enacted amendments to the Act which made clear it’s intent to require a referral

by the FEC before the Attorney General could prosecute. The 1980

-18-



regulations under the Act, and render advisory opinions as to whether “any |

specific transaction or activity by such [an] individual . . . would constitute a

ee

violation of th[e] Act. 88 Stat. 1282-83. The 1974 amendments also provided
that: !

The Commission, upon receiving any complaint under
paragraph (1)(A), ora referral under paragraph (1)(B),
or if it has reason to believe that any person has |
committed a violation of any such provision, shall |
notify the person involved of such apparent violation
and shall report such violation to the Attorney
General;

88 Stat. 1284. |
Along with the 1974 amendments to the FECA, Congress also amended |
certain provisions of the federal criminal code contained in Title 18 of the |
United States Code. Specifically, Congress amended 18 U.S.C. § 608 relating
to limitations on contributions by providing that “no person shall make

contributions to any candidate with respect to any election for Federal office

which, in the aggregate, exceed $5,000.” Pub. L. No. 93-443, § 101, 88 Stat.

NAL CORPORATION © ATTORNEYS AND CO!NSELORS ATE AW © [NO WEST TEN WILE ROAD + SOUTHFIELD MICHIGAN I807S.2463 © TELEPHONE 12 bse 55.5555

1263. Congress also added 18 U.S.C. § 614 which provided that “[n]o person
shall make a contribution in the name of another person.” 88 Stat. 1268.
In 1976, Congress further amended the Act by shifting to the FECA many

of the campaign finance restrictions previously contained in Title 18 of the

-14-

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KENNEY. JOHNSON

E. The Attorney General’s assertion that he may proceed
simultaneously with an investigation without referral while the
FEC exercises its own congressionally mandated subpoena
power creates the unconstitutional conundrum of compelling
individuals to invoke the Fifth Amendment and thus thwart the
ability of the FEC to exercise its exclusive jurisdiction.

The Attorney General’s proposed interpretation of the Act impermissibly
allows vital Fifth Amendment protections to be used as a mechanism to thwart
the entire purpose of the FEC. Under the Attorney General’s theory, he may
proceed with a criminal investigation irrespective of a referral by the FEC.
Under sucha scheme, every time the FEC provides its statutorily required notice
to an individual of possible noncompliance with the Act, an individual would,
without fail, assert her Fifth Amendment right against self-incrimination for fear
that any statements made to the FEC would be used against her by the Attorney
General in a criminal prosecution.

Moreover, the FEC would be powerless to proceed because an
individual’s fear of prosecution would be well founded. Certainly a court could
not enforce an FEC subpoena during a simultaneous civil investigation (by the
FEC) anda criminal investigation (by the Attorney General) without compelling
a violation of a respondent’s Fifth Amendment privilege. Thus, allowing
simultaneous investigations would prevent the FEC from ever carrying out its

statutory duties.

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TELEPHONE 2483 398-8

FIEGFR FIFGFR KENNEY JOHNSON & GIROU'S + 4 PROFESSION SL CORPORATION + ATTORNEYS AND COUNSELORS ATLAW + [9744 WESTTEN MITE ROAD + SOUTHEIELD MICHIGAN 48075-2483 +

of the simple fact that the Attorney General has effectively stripped the FEC of
its congressionally mandated “exclusive” civil jurisdiction.

On February 5, 2007, Plaintiffs filed the instant action seeking a
declaratory judgment that the acts of the Attorney General are in violation of the
Federal Election Campaign Act (R.!, Application for Writ of Mandamus and
Complaint, Apx. _). Specifically, Plaintiffs claim that the Attorney General,
aided by the FEC, have ignored the jurisdictional requirements of the Act such
that the Attorney General’s investigation is extra-jurisdictional, and thus,
unconstitutional.

Plaintiffs also claim that the FEC violated its statutorily mandated duty
to conduct an investigation as required by statute. Plaintiffs seek relief under
the Administrative Procedures Act to compel the FEC to perform its statutory
duties.

District Court Proceedings and Order

The parties filed cross motions for judgment and dismissal. Pursuant to
Local Rule, the district court decided the motions without oral argument and
issued its Opinion and Order on August 15, 2007, granting Defendants’ motions

to dismiss (R.33, Opinion and Order, Apx. _).



JURISDICTIONAL STATEMENT

The district court had original jurisdiction as the case is based ona federal

question. 28 U.S.C. §1331. Specifically, Appellants sought a declaratory

judgment under 28 U.S.C. §§ 2201 & 2202 as to the proper interpretation of 2

TELEPHONE

U.S.C. § 437g. This is an appeal from the final judgment and order of the

district court that was entered on August 15, 2007, granting Defendants’

motions to dismiss. The district court’s order disposed ofall parties’ claims and

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is appealable to the Sixth Circuit Court of Appeals pursuant to 28 U.S.C. §1291.

Plaintiffs filed their timely Notice of Appeal on October 10, 2007.

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interpretation of statutory provision that renders another superfluous cannot be
correct). Under the Attorney General’s theory, if the FEC was considering a
criminal referral to the Attorney General, but the Commission voted 5 to |
against such a referral, then the lone member in support of referral could simply
walk across the street to a politically allied Attorney General and say, “prosecute
this case, the Commission has refused to refer for prosecution so I’m bringing
it to you myself.” Congress specifically contemplated, and prohibited, such a
politically corrupt acts.

A second provision of the 1980 amendments further mandates that the
Attorney General may investigate and prosecute violations of the Act only after
referral from the FEC. Under 2 U.S.C. § 437g(d)(2), a defendant in a criminal
action “may evidence their lack of knowledge or intent to commit the alleged
violation by introducing as evidence a conciliation agreement entered into
between the defendant and the Commission . . ."(emphasis added).

By using the word “entered” in the past tense, it is elear that Congress
intended the FEC to have the first opportunity to examine and administratively
resolve alleged violations of the Act before referring the matter to the Attorney
General. This provision would be nullified if the Attorney General could first

prosecute an alleged violation of the Act.

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Consistent with the statutory scheme to provide exclusive jurisdiction to |
the FEC, Congress provided the FEC with powerful tools to exercise its
exclusive jurisdiction to enforce the Act. For example, in addition to its
subpoena power, the FEC is authorized “to render advisory opinions” as to
whether certain conduct or transactions are permissible under the Act. 2 U.S.C.
§ 437d. The FEC’s power to issue advisory opinions would be rendered
meaningless and would be preempted if the Attorney General could
independently investigate and charge criminally without first allowing the FEC
to examine a case through the issuance of advisory opinions as set forth in 2
U.S.C. § 437d(a)(7). Such a practice by the Attorney General would lead to
inevitable conflicts where the FEC and the Attorney General reach entirely
inconsistent and diametrically opposed positions as to interpretation,
implementation, and enforcement of the Act. This anomalous result is clearly
prevented by the Act’s orderly scheme providing original jurisdiction to the
FEC.

Additionally, § 437d(a)(8) delegates to the FEC the sole power to
“develop such prescribed forms and to make, amend and repeal such rules . . .
as are necessary to carry out the provisions of this Act.” Thus, the Act means

exactly what it says; that is, that Congress delegated the exclusive authority to



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(EGER KINNEY J

TABLE OF AUTHORITIES

FEDERAL CASES

American Eagle Credit Corp. V. Gaskins,
920 F.2d 352 (6th Cir. 1990) ....

ioner Internal Revenue Serv.,

Arkansas Best Corp. v. Comm
485 U.S. 212 (1988) ...

Blau v. United States, 340 U.S. 159 (1950) wee eects tenes eeeeree tease 28
Bower v. Federal Express Corp., 96 F.3d 200 (6th Cir. 1996)... 11
Buckley v. Valeo, 424 U.S. 1 (1976) cicccccsceccsescesessesetecsecereneneeseneneenenes 30
Forest v. United States Postal Serv., 97 F.3d 137 (6th Cir. 1996) ....... 11
Hoffman v. United States, 341 U.S. 479 (L951) .occecce ect eeeeeeee 28
Holbrook v. United States, 284 F.2d 747 (9th Cir. 1960) vce 23
Marchetti v. United States, 390 U.S. 39 (1968) cceccesseseteteeeeteneeee 29

Murphy v. Waterfront Commission of New York Harbor,
378 U.S. 52 (1964) woes cece eee esses eseeatanseseesenesesesneanesaeanenenesesnease 29

Norton v. Southern Utah Wilderness Alliance, 542 U.S. 55 (2004) ..... 37
Order of Railway Conductors v. Pitney, 326 U.S. 561 (1946) wu. 31
Stockman v. FEC, , 138 F.3d 144 (Sth Cir, 1998) ooo. 40

Taxpayers United for Assessment Cuts v. Austin,
994 F.2d 291 (6th Cir, 1993) ooeeccccecssecssseseseecseseeeeeeenensseseeeeeseseneneaees 11

United States v, Alaska Steamship Co.,
110 F. Supp. 104 (Dist. D.C. 1952) occ eeceeecsessenceesescseseseaeaees 32

-iv-



FIEGER FILGER, KENNEY JOHNSON & GIROUX + 4 PROFESSIONAL CORPORSSION + ATTORNEYS AND COUNSELORS ATL AW + 193 LST TFR MILL ROAD © SOL THECLD MICHIGAN 4nt7s

Specifically, the district court found that “there is no language in the Act
that evidences a ‘clear and unambiguous’ intent of Congress to grant the
Commission exclusive jurisdiction (at any time) to enforce criminal violations
of the Act.” (R.33, Opinion and Order, pg. 10, Apx. __). The district court
further concluded that “there is no other language in the Act which could
constitute a prohibition or restriction on the authority of the Attorney General
to investigate or charge a criminal violation of federal election law.” (R.33,
Opinion and Order, pg. 10, Apx. _).

As to the referral provision of the Act, the district court concluded that
“[t]his provision only addresses the Commission’s authority; however, nothing
in that (or any other) provision of the Act addresses, much less restricts, the
authority of the Attorney General...” (R.33, Opinion and Order, pg. 10, Apx.
_).

The district court also rejected Plaintiffs’ claim under the Administrative
Procedures Act and concluded that the Federal Election Campaign Act did not
impose “any deadline for the Commission to take particular investigatory
actions.” (R.33, Opinion and Order, pg. 15-16, Apx. __). The district court also

held, in the alternative, that it lacked jurisdiction over Plaintiffs’ APA claims.

-10-



OW WEST IN MILEROAD © SOUTHFIELD, MICHIGAN 480752095

FIEGLR PIEGER. KENNEY JOHNSON & GIROUX + A PROFESSION ALCORPORATION. + ALLORNEYS AND COUNSELORS ALLA +

STATEMENT IN SUPPORT OF ORAL ARGUMENT

Plaintiffs-Appellants, GEOFFREY N. FIEGER, ef a/., request oral
argument in the instant appeal. The appeal is sufficiently complex to warrant
oral argument which would afford the Court the opportunity to pose any
questions it may have concerning the facts or the specifics of the parties’
respective positions.

Plaintiffs’ counsel sincerely believes that participation in oral argument
will be beneficial, and that the decisional process will be significantly aided by
this Court’s grant of oral argument.

As Sixth Circuit Senior Judge Gilbert S. Merritt has stated:

At its core, the adversary process is oral argument.
The presence of live human beings in verbal combat
engages the attention of judges and makes them think,
question, discuss and reconsider a case as can nothing
else, including able briefs and judicial opinions on
analogous points. It focuses thought and reflection
more than discussion and debate with law clerks in
chambers even when the law clerks are better lawyers

than the lawyers in the case.

Merritt, Judges on Judging: The Decision Making Process in Federal Courts of

Appeals, 51 Ohio St. L.J. 1385, 1386-1387 (1991).

-vii-



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A. The 1976 Amendments to the Act show that congress fully
intended to depoliticize campaign finance disputes by taking
them away from the purview of the Attorney General and
placing them in the first instance within the “exclusive
primary” jurisdiction of the FEC.

Significantly, Congress also amended the Act to add the word “exclusive”
before the word “primary” to describe the jurisdiction of the FEC over the Act.
90 Stat. 476. At the same time, Congress restricted the Attorney General’s
ability to prosecute alleged violations of the Act without first receiving a referral
by the FEC. Specifically, in 1976, Congress commanded that:

If the Commission determines that there is probable

cause to believe that a knowing and willful violation

subject to and as defined in section 329 . . . has

occurred or is about to occur, it may refer such

apparent violation to the Attorney General of the

United States ...
90 Stat. 484. These 1976 amendments are important because they show that
Congress fully intended to depoliticize campaign finance disputes by taking
them away from the purview of the Attorney General and placing them in the
first instance within the “exclusive primary” jurisdiction of the FEC. Indeed, the
very definition of “exclusive jurisdiction” means “to the exclusion of all others.”
BLACKS LAW DICTIONARY 564 (6th ed. 1990).

Under this statutory scheme, the FEC has exclusive jurisdiction to civilly

resolve any alleged violations of the Act; failing which it can refer violations to

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Case No. 07-2291

ON
£ OF GENERAL
COUNSEL
UNITED STATES COURT OF ARB GNU A %43
FOR THE SIXTH CIRCUI

(On Appeal from the United States District Court,
Eastern District of Michigan, Civil Action No. 07-10533
the Honorable Lawrence P. Zatkoff)

GEOFFREY N. FIEGER; NANCY FISHER;
FIEGER, FIEGER, KENNEY AND JOHNSON, P.C.,

Plaintiffs-A ppellants,
vs.
U.S. ATTORNEY GENERAL ALBERTO R. GONZALES;
FEDERAL ELECTION COMMISSION CHAIRMAN
MICHAEL E. TONER, in their official capacities,

Defendants-Appellees.

PLAINTIFF-APPELLANT’S PROOF BRIEF ON APPEAL
CERTIFICATE OF COMPLIANCE

CERTIFICATE OF SERVICE

Submitted by:

Michael R. Dezsi (P64530)

Fieger, Fieger, Kenney, Johnson & Giroux, P.C.
19390 W. Ten Mile Road

Southfield, MI 48075

(248) 355-5555



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+ EAN Qua

+ TEE FPHONE 1238) 455-5555,

\PROPLSSIONAL CORPORATION + AITORNEYS AND COUNSELORS ATT AW + 191 WESTTEN Ml E ROAD * SOUTHEIFID MICHIGAR 49475 246,

FIFGER FIEGER KENNEY JOHNSON & GIROLX +

The FEC also contends that the district court does not have jurisdiction
to consider Plaintiffs’ APA claim. The district court agreed and found that
Plaintiffs’ APA claim, ifany, must be brought in the United States District Court
for the District of Columbia. The district court’s conclusion is patently
incorrect. In reaching its decision, the district court relied on 2 U.S.C. §
437g(a)(8) which provides a cause of action for an individual who files an
administrative complaint with the FEC. Specifically, § 437g(a)(8) provides that:

[a]ny party aggrieved by an order of the Commission

dismissing a complaint filed by such party under

paragraph (1), or by a failure of the Commission to

act on such complaint during the 120-day period

beginning on the date the complaint is filed, may file

a petition with the United States District Court for the

District of Columbia.
2 U.S.C. § 437g(a)(8). This section deals with a situation in which an individual
files a complaint with the FEC.

Perhaps a voter in lowa believes that one of the presidential candidates
has failed to properly report his expenditures under the Federal Election
Campaign Act. The voter then files an administrative complaint with the FEC

pursuant to 2 U.S.C. § 437g(a)(8). If the FEC dismisses the voter’s complaint,

or fails to act on the complaint within 120 days, the complainant may file suit



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SOL THEIFLDD MICIIGAN 49195-2464 + TELEPHONE

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STATEMENT OF THE CASE

This case poses a question of first impression for this Court as to whether
the Federal Election Campaign Act (“Act”) sets forth a sequence under which
the Federal Election Commission (“FEC”) investigates alleged campaign
finance disputes in the first instance and that the Attorney General can
investigate only after receiving a referral from the Commission.

Under the Act, the FEC has exclusive civil jurisdiction to investigate

campaign finance disputes. This means that the FEC may exercise its

jurisdiction to the exclusion of all others. Indeed, the very definition of

‘exclusive’ jurisdiction means “to the exclusion of all others.” Blacks Law
Dictionary 564 (6th ed. 1990). And for more than thirty years, the FEC has
resolved, civilly, virtually a// campaign finance disputes without the
intervention or interference of the Attorney General.

The Act also sets forth a referral mechanism by which the FEC may refer
certain violations to the Attorney General but only by a bipartisan majority vote
of the FEC. By giving the FEC exclusive civil jurisdiction and providing a
referral mechanism by which the FEC may refer matters to the Attorney General,
it is clear that Congress set forth a sequence under which the FEC would

conduct its civil investigation in the first instance (to the exclusion of all others

3-



UTHEIELD MICHIGAN

S
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ATION + ATTORNEYS AND COUNSELORS ATLA +

FIEGER FIEGER. KENNEY JOHNSON & Git

Il.

STATEMENT OF ISSUES PRESENTED

The Federal Election Commission has primary and exclusive jurisdiction
over the Federal Election Campaign Act. The provisions of the Act set
forth a sequence under which the Commission exclusively investigates
alleged violations of the Act in the first instance, and the Attorney
General may investigate only upon an affirmative and majority vote of the
Commission. Did the district court err in dismissing Plaintiff's request
for declaratory judgment where the Attorney General violated the Act by
initiating an investigation without the statutorily required referral set forth
in 2 ULS.C. § 437g(a)(5)(C)?

Plaintiffs-Appellants answer: “YES”
Appellees Gonzales and the FEC

presumably answer: “NO”
The district court would answer: “NO”

Under Section 706 of the Administrative Procedures Act, a district court
has jurisdiction to “compel agency action unlawfully withheld or
unreasonably delayed.” Upon finding reason to believe that a violation
of FECA has occurred, section 437(g)(2) of the Act compels Defendant
FEC to “make an investigation of such alleged violation.” Although
Defendant FEC has failed to perform its statutory duties, the district court
concluded that it lacked jurisdiction undcr the APA to compel the FEC to
comply with the law. Does the district court’s decision conflict with the
APA?

Plaintiffs-Appellants answer: “YES”
Appellees Gonzales and the FEC

presumably answer: “NO”
The district court would answer: “NO”



SPAR UNIS Shoe

+ TEE EPHONL 2451 A856.5555

2H

= FILGER FIEGER, KENNEY, JOHNSON & GIROUX + A PROLESSIONAL CORPORSTION + AFTORNEYS AND COUNSELORS AT LAW + [91 WEST CLN MILL ROAD + SOL HIRILLD. MICHIGAN ano75

that it has reason to believe that a person has committed a violation of the Act.
Specifically, 2 U.S.C. § 437g(a)(2) provides:

If the Commission . . . determines, by an affirmative

vote of 4 of its members, that it has reason to believe

that a person has committed . .. a violation of this Act

. .. the Commission shall, through its chairman or

vice chairman, notify the person of the alleged

violation. [] The Commission shall make an

investigation of such alleged violation...
2 U.S.C. § 437g(a)(2). Although the FEC has found reason to believe that
Plaintiffs may have violated the Act, the FEC has refused to perform its
statutory duty to investigate. And so now the FEC has also violated the law.

On September 19, 2006, a year after the Attorney General initiated its

extra-jurisdictional investigation, the FEC found, by a vote of at least 4
members, that it had reason to believe that Plaintiffs may have violated certain
provisions of the Act (R.4, Plaintiffs’ Motion for Declaratory Judgment and Writ
of Mandamus, Ex. B, Apx. __). Since September 19, 2006, the FEC has not
voted to refer the case to the Attorney General, nor can it since it has not
conducted the statutorily required investigation. In fact, the FEC has utterly

failed to comply with the congressional mandate that it “shall make an

investigation of {Plaintiffs’] alleged violation.

-35-



Commission consists of 6 members, no more than 3 of whom can be from the
same party, Congress expressly required bipartisan support from a majority of
the Commission before referring a case for criminal prosecution.

In determining the effect to be given the provision requiring an

affirmative vote of 4, it is not only appropriate for this court to examine the
nature and objectives of the FEC as a whole but “a significant consideration . .

. is a comparison between the results to which each such construction would

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lead.” Holbrook v. United States, 284 F.2d 747, 752 (9th Cir. 1960). The very
purpose and essence of requiring “an affirmative vote of 4" members in order
to refer a matter for criminal prosecution would be rendered meaningless if the

Attorney General could just simply step in and say “oh well, since they don’t

have the bipartisan support of a majority vote of the Commission we’ ll issue an

indictment ourselves.” Congress clearly contemplated this exact politically

+ ATTORNEYS AN

charged scenario and guarded against it by requiring the bipartisan support of
4 members of the Commission before the FEC could refer a case to the Attorney
General for criminal prosecution.

Ifthe Attorney General’s assertion of concurrent jurisdiction was true, the

purpose of a 4 member bipartisan vote for referral would be superfluous.

Arkansas Best Corp. v. Comm’r Internal Revenue Serv., 485 U.S. 212, 218 (an

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-23-



+ FAA

FIFGER FIEGER KENNEY. JOHNSON & GIROLX + 4 PROFESSIONAL CORPORATION + ATTORNLYS AND COUNSELORS AP LAW + ISM FEST TEN MILF ROAD © SOUTHFIFLD SHCIIGAN 48029 246%

in the District of Columbia under § 437g(a)(8) seeking judicial review of the |
FEC’s decision. |
The FEC contends however, and the district court found, that other than |
the aggrieved complainant under § 437g(a)(8), there can be no other claims
brought against the FEC under the Administrative Procedures Act. According
to the FEC, § 437g(a)(8) displaces any and all other potential claims against the
FEC under the APA.

In leaping to this wildly erroneous conclusion, the FEC relies on §
701(a)(1) of the APA which provides that “[t]his chapter applies, according to
the provisions thereof, except to the extent that statutes preclude judicial
review.” Because § 437g(a)(8) provides a statutory cause of action for an
aggrieved complainant (i.e., the Iowa voter), this section must therefore
“preclude judicial review” ofall other types of claims under the APA, according
to the FEC. Following the FEC’s argument, because Plaintiffs are respondents
to an FEC matter under review (and not complainants) they cannot file suit
under the APA. As a matter of federal jurisdiction, the FEC’s argument is
simply wrong.

But this is not the first time that the FEC has made this erroneous

jurisdictional argument. The FEC made the same argument in Stockman v. FEC,

-40-



Slay

148) S55 SMS + FAN UNI TSS

+ THLCPHONE 02

246%

+ 19300 WEST TEN MILE ROAD + SOUTHFIELD MICHIGAN 4807s.

SITORNEYS AND COUNSELORS AT LAW

FIFGER FIFGER KENNEY. JOHNSON & GIROUX © PROFESSIONAL CORPORATION +

the FEC to carry out its mandate as contained in the Act. Congress’s mandate
would be meaningless, and rendered nugatory, ifthe Attorney General were free
to develop his own guidelines for interpreting and prosecuting the provisions of
the Act before [or without] the FEC’s involvement, or before the FEC even had
the opportunity to exercise its exclusive jurisdiction over enforcement.

D. The 1980 Amendments to the Federal Campaign Finance Act

contain a congressionally mandated sequence that the Attorney
General may investigate alleged violations of the Act only upon
a referral by an affirmative vote of 4 members of the FEC.
Without an FEC referral, the Attorney General has no
congressional authority to conduct an investigation of federal
campaign finance violations.

If there were any doubt remaining after the 1976 amendments as to the
question of whether Congress intended to give the FEC exclusive jurisdiction,
Congress again amended the Act in 1980 to eliminate any confusion that might
have been caused by the erroneous 1979 Ninth Circuit opinion. In 1980,
Congress added two significant provisions mandating the FEC’s exclusive
jurisdiction. First, Congress mandated that an alleged knowing and willful
violation of the Act could be referred to the Attorney General only “by an
affirmative vote of 4 of its members”. 2 U.S.C. § 437g(a)(5)(c). This is

significant because it shows that Congress wanted to avoid political

prosecutions of an out-of-power party by the controlling party. Because the

22.



5

CORPOR SION

FIEGER FIRGER. KENNEY JOUIss

5 U.S.C. 8§ 701-706 ...
5 USC. § 102 ceeccesssvssssesssssssevtssssisvssssssssesevevessasserssseussucaeseecsecseeeeee 36, 42
18 U.S.C. § 608 veccccssccsssscsssssessesssssessesssestestessistettevtesasetsessenseseeees 14, 15

IS U.S.C. § 614 ...

28 US.C. § 1290 ie eeeeceececess ees esseeeeenecsneeessneessessesanesnessesanesreeseeseseseess 1
28 U.S.C. § 133) cece ceeseecsecsecseessessessneeeeeseseeceseesnseneeaceeneeeeeneeneeanse 1,42
28 U.S.C. § 1361 eee ees cece ces eeeeseeseeaeseeseeseesesnesnsansaeeseseesesess 36, 43
28 U.S.C. §§ 2201 & 2202 ocecececccescecneeeneseesees eee eee tees eeeneeneeneeneeneennennees 1
88 Stat. 1263 eee cess ec eeeeeeeeenesneseeesansaeeseesanesseaneeseesueenconeeneess 13, 14
88 Stat. 1268 ce eeesees esse sssesaesescesessesseesneeneeeesnneensaneaneeeneneeens 14
BS Stat. LSD ee eee eeceeesesseseneseeseesseesceseeeessetenesseesessesessesssnesseeneeneeses 13
88 Stat. 1284 oc eeeecesceceeseseseesessesteseeseesessesssssseeseeesesseesesessesseaseseeseens 14
90 Stat. 475 ceeeccceccecesessseneseseseesecseanssneseeeeseseseesssnsenssnsssssseesseneaneneees 15
90 Stat. 476 i eeeeececscss esses eeseesuessessnessnssnseaeenneaeaneesnsanseetsnsensenceneess 16
90 Stat. 484 eee essees neces nesseteneeseeseeeneesseseeaeseeseereessenrereneeae 16
90 Stat. 486-87 occ cece ees cseccsescseseseeeeesseeeneeeeseeeenesensseeaneceteceretees 15
90 Stat. 490 iececececeesecseesneseessesseesesssesenssneeseseesnesnesaneenseesaneennenenes 15
93 Stat. 1361-62 .eeccececceceecseeseeseeseccectceseeeseeseseesnsensenersssnssetenseneeseenses 20
MISCELLANEOUS
Merritt, Judges on Judging: The Decision Making Process in Federal
Courts of Appeals, 51 Ohio St. L.J. 1385, 1386-1387 (1991)... vii
-vi-



| PELLPHONE cage aS S856 6

IELD MICHIGAN 18075 Zan

= SOt Hit

STILS MILE 804D.

6309 WL

GIROUX +S PROFESSIONAL CORPORATION © \TSORNEYS AND COUNSELORS AL LAW +

FIECER HEGER KENNLY JOHNSON

Attorney Genera] of his ability to prosecute suspected violations of the Act
absent a referral from the Federal Election Commission (FEC).

In 1971, Congress created the FECA to regulate the financing of political
campaigns. Public Law 92-225. At the same time, Congress amended several
provisions of the federal penal code contained in Title 18 of the United States
Code and placed monetary limits on both individual contributions and
expenditures in federal political campaigns. Significantly, Congress left many
campaign finance crimes in Title 18 of the U.S.C. where those crimes were
exclusively subject to prosecution by the Attorney General.

In 1974, Congress amended the FECA and created the Federal Election
Commission. Federal Election Campaign Act Amendments of 1974, Pub. L. No.
93-443, § 310, 88 Stat. 1263, 1280-83 (amended 1976, 1979, 2002). By statute,
Congress expressly required that “[t]he Commission shall administer, seek to
obtain compliance with, and formulate policy with respect to this Act ....” 88
Stat. 1281. The Commission was also given “primary jurisdiction with respect
to the civil enforcement of such provisions.” /d.

In order to carry out its congressional mandate, the Federal Election
Commission, as an independent federal agency, was created to conduct

investigations, issue subpoenas, initiate civil actions, promulgate rules and

-13-



186 51d

+ Pax aa

PEMOT + TELLPHONE UN SS 8855

+ 1900 WEST TEN MILE ROAD = SOUTHFIELD 4t

FIEGER FILGER KLNVFY JOHNSON & GIROL © A PROFESSIONAL CORPOR (TION + ATTORNEYS AND COLNSELORS ATI AN

construction of the Act to include shared or concurrent jurisdiction must be
rejected by this Court as an impermissible infringement upon the statutory
framework providing the FEC with primary and exclusive jurisdiction
F. Acongressional grant of primary and exclusive jurisdiction to
the FEC effectively and entirely forecloses the Attorney
General’s contention of shared or concurrent jurisdiction.
Exclusive and concurrent jurisdiction do not go hand-in-hand.
The FEC’s ability to exercise its primary and exclusive jurisdiction over
the law is gutted when the Attorney General intervenes uninvited by the FEC.
In Buckley v. Valeo, 424 U.S. | (1976), the Supreme Court described the FEC’s
enforcement power as “both direct and wide ranging.” Buckley, 424 U.S. at 112.
The Court also emphasized that the FEC has exclusive jurisdiction to decide
how to proceed under the Act. Specifically, the Court stated that “[{i]Jn no
respect do the foregoing civil actions require the concurrence of or participation
by the Attorney General; conversely, the decision not to seek judicial relief in
the above respects would appear to rest solely with the Commission.” Id. (italics
added).
By ignoring the FECA statutory scheme, the Attorney General has
usurped the primary and exclusive jurisdiction of the FEC and taken it for
himself. The FEC is thus forced to sit by while the Attorney General

disingenuously claims that he and the FEC share exclusive jurisdiction. In an

-30-



2 effort to circumvent the obvious conflict, the Attorney General suggests in the
2 alternative that he has jurisdiction over criminal matters while the FEC has

¢ Jurisdiction only over civil matters. These arguments completely miss the mark.

When the Attorney General steps in, without a referral, he has stripped

+ TLD

the FEC of any and all jurisdiction to do anything, including civil enforcement

75.2401

of the Act. In short, the Attorney General does violence to the congressional

command that the Commission shall have “exclusive jurisdiction of civil

LITT ALLD MICHIE

enforcement.” 2 U.S.C. § 437c(b). “Exclusive” means exactly what it says: that
the FEC has jurisdiction to the exclusion of all others including the Attorney
General. Indeed, the Attorney General’s proposition of “shared exclusive
jurisdiction” is an oxymoron. The statute requires that the FEC exhaust its
administrative functions before making a referral to the Attorney General.

The Attorney General’s position is also at odds with the abstention

ATTORNEYS VAD COUNSELORS AT Lait © 190 WEST TEN MILL ROAD + SO}

doctrine of primary jurisdiction. Primary jurisdiction is used by the federal
courts to abstain from hearing certain matters until after the agency has had an
opportunity to interpret unanswered technical factual issues. Order of Ry.
Conductors v. Pitney, 326 U.S. 561, 567 (1946); United States v. Haun, 124

F.3d 745 (6th Cir. 1997)(“The doctrine of primary jurisdiction arises when a

3]-

= FIRGER FIFGER KENNEY JOINSON & GIROL\ + A PROFESSIONAL CORPOR TION +



Case No. 07-2291

UNITED STATES COURT OF APPEAL
FOR THE SIXTH CIRCUIT

SAN uN Sea

(On Appeal from the United States District Court,
Eastern District of Michigan, Civil Action No. 07-10533
the Honorable Lawrence P. Zatkoff)

GEOFFREY N. FIEGER; NANCY FISHER;
FIEGER, FIEGER, KENNEY AND JOHNSON, P.C.,

Plaintiffs-Appellants,
vs.
U.S. ATTORNEY GENERAL ALBERTO R. GONZALES;

FEDERAL ELECTION COMMISSION CHAIRMAN
MICHAEL E. TONER, in their official capacities,

3

Defendants-Appellees.

CERTIFICATE OF SERVICE

+ ATTORNEYS AN

Michael R. Dezsi hereby certifies that on December 28, 2007, he caused
to be served by first-class mail a copy of Plaintiff-Appellant’s Proof Brief on
Appeal upon: Eric Fleisig-Grene, Esq., U.S. Department of Justice, Civil
Division, 950 Pennsylvania Avenue, N.W., Suite 7214, Washington, D.C.
20530-0001; and Greg I. Mueller, Esq., Federal Election Commission, 999 E
Street, N.W., Washington, D.C. 20463-0000.

AFZAL

Michael R. Dezs#P64530)

&
é

-46-

FU-GER. PILGER, KENNEY



‘ amendments were intended to codify the intent of Congress to require a referral
: by the FEC before the Attorney General could prosecute.
The 1980 amendments require that the FEC may refer a matter to the

Attorney General for criminal prosecution only by an affirmative vote of 4 of its

members. Specifically, the Act provides that:

If the Commission by an affirmative vote of 4 of its

members, determines that there is probable cause to

believe that a knowing and willful violation of this

Act [or chapter 95 or chapter 96 of the Internal

Revenue Code of 1954] has occurred or is about to

occur, it may refer such apparent violation to the

Attorney General of the United States without regard

to any limitations set forth in paragraph (4)(A).
2 U.S.C. § 437g(a)(5)(C)(emphasis added). It is only after the FEC opens this
jurisdictional door (i.e., by an affirmative vote of 4 of its members) that the
Attorney General may proceed with an investigation (or prosecution) under the
Act. This congressionally mandated sequence allows the FEC to exclusively
exercise its subpoena power in the first instance to determine compliance or
conciliation before ever referring a matter to the Attorney General.

Upon referral to the Attorney General, the Act now requires that “the

Attorney General shall report to the Commission any action taken by the
Attorney General regarding the apparent violation. Each report shall be

transmitted within 60 days after the date the Commission refers an apparent

-19-

FIEGER. HIEGER KENNEY JOHNSON & GIROLX + A PROILSSIONAL CORPORATION + ATIORNFYS AND COUNSELORS ATLAW + 199%) WEST TFN MILF ROAD + SOUTHFIELD MICHIGAN 480



2g) © TALEPHONE (iyi 495 S886 © BAX 2M 8S

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FIEGIR EIGER KENNEY JOHNSON & GIROUX + A PROFESSION ML CORPORATION + ATTORNEYS AND COL NSELORS ATLA

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Testimony from the Senate Floor confirms that
Congress intended to restrict the Attorney General
from independently investigating violations of the Act
absent a bipartisan referral from the Commission .....

The Ninth Circuit’s Opinion in /nt’! Union has been
superceded by the 1980 Amendments to the Act ......

The 1980 Amendments to the Federal Campaign
Finance Act contain a congressionally mandated
sequence that the Attorney General may investigate
alleged violations of the Act only upon a referral by
an affirmative vote of 4 members of the FEC.
Without an FEC referral, the Attorney General has no
congressional authority to conduct an investigation of
federal campaign finance violations................

The Attorney General’s assertion that he may proceed
simultaneously with an investigation without referral
while the FEC exercises its own congressionally
mandated subpoena power creates the
unconstitutional conundrum of compelling
individuals to invoke the Fifth Amendment and thus
thwart the ability of the FEC to exercise its exclusive
jurisdiction 2.2... cece eee eee

A congressional grant of primary and exclusive
jurisdiction to the FEC effectively and entirely
forecloses the Attorney General’s contention of
shared or concurrent jurisdiction. Exclusive and
concurrent jurisdiction do not go hand-in-hand .......

Under Section 706 of the Administrative Procedures Act, a
District Court Has Jurisdiction to “Compel Agency Action
Unlawfully Withheld or Unreasonably Delayed.” Contrary
to the Terms of the APA, the District Court Erroneously
Concluded That it Lacked Jurisdiction Under the APA to
Compel the FEC to Comply With the Law ...............

-li-

22

27

30



+ FAR (2S) 8S},

SHEL LPHONE (24, 155.5585

ANUS 263

APROFLSSIOVAL CORPORATION + STTORNEYS ANID COUNSELORS ATLAW. + [U0 WEST TEN MILE ROAD © SOUTHEILLD. MICHIG:

FILGER FIFGER. KENNEY JOHNSON « GIROUA +

Now, Defendant FEC resorts to disingenuous arguments to avoid the
merits of Plaintiffs’ claims. For instance, the FEC contends that a federal court
cannot tell the FEC how and in what manner to conduct its investigation. This
may be true, but this is not what Plaintiffs are seeking. The FEC is not
conducting any investigation because the Attorney General has usurped its
exclusive jurisdiction and prevented the FEC from performing its statutorily
mandated duties.

Next, the FEC mysteriously claims that Plaintiffs can only speculate about
what the Commission might have done in its investigation. So is the FEC’s
argument that it does not have to do anything, or that it is doing something in
secret? This argument resembles a game. First, the FEC claims it has no duty
to do anything, but the statute provides otherwise. So in the alternative, the FEC
suspiciously claims that it may be conducting a secret investigation.

The likely answer is that the FEC is not conducting any investigation (and
it cannot since the Attorney General has usurped its exclusive civil jurisdiction).
And having reversed the sequence of the statute, the Attorney General and FEC
now find themselves resorting to arguments grounded in omnipotency.

Congress did not promulgate the law to be circumvented in this manner.

-38-



$3508 =

SPAN

+ TELEPHONE (ys £84 688

248}

FESSIONAL CORPORATION + ATIORMEYS AND COUNSELORS AT LAW = [9190 WEST TEN Mit F ROAD © SOUTHEILID MICHIGAN 48075.

FIEGER, PIEGER, KENSEY JOHNSON & GIROUX + VPRO}

By failing to comply with the law, the FEC and the Attorney General have
forced Plaintiffs to endure an extra-jurisdictional and unconstitutional
investigation. This is not a situation where Plaintiffs are demanding needless
formality, but rather, Plaintiffs are seeking to have this Court require that the
FEC comply with the provisions of the Act.

Ifthe FEC were to have complied with the Act in the first instance, there
might never be a criminal investigation or prosecution because the FEC might
never refer this matter to the Attorney General.* Accordingly, Plaintiffs seek
relief under the Administrative Procedures Act (APA), 5 U.S.C. §§ 701-706, and
28 U.S.C. § 1361.

Title 5 U.S.C. § 702 provides that:

A person suffering legal wrong because of agency
action, or adversely affected or aggrieved by agency
action within the meaning of a relevant statute, is
entitled to judicial review thereof. An action in a
court of the United States seeking relief other than
money damages and stating a claim that an agency or
an officer or employee thereof acted or failed to actin
an official capacity or under color or legal authority
shall not be dismissed nor relief therein be denied on
the ground that it is against the United States or that
the United States is an indispensable party.

‘The fact that the Attorney General has illegally interfered with the ability
of the FEC to conduct its investigation is proof positive of the argument made
herein that the statute is being undermined, circumvented, and violated.

-36-



mandated that the six member Commission consist of 3 members from each

party, and required a bipartisan majority vote of 4 members in order to refer a

has conducted its own investigation. Specifically, the Act provides that

If the Commission by an affirmative vote of 4 of its
members, determines that there is probable cause to
believe that a knowing and willful violation of this
Act... has occurred or is about to occur, it may refer
such apparent violation to the Attorney General of
the United States ....

2 U.S.C. § 437g(a)(5)(C)(emphasis added). Thus, it is only after the FEC opens

SMILE

this jurisdictional door (i.e., by an affirmative vote of 4 of its members) that the
Attorney General may proceed with an investigation under the Act.

The Attorney General and FEC contend that the referral mechanism is

merely a limitation on the FEC and does not restrict the authority of the

Attorney General. However, such an interpretation of the statute produces an

ATTORNEYS AND COL

absurd resuit. An example that best illustrates the obvious flaw in the Attorney

JONAL CORPORATION +

General’s and FEC’s argument is as follows: If the FEC votes 5 to | against

referral, the lone disgruntled FEC member can simply walk across the street and

say to the Attorney General, “the FEC won’t vote to refer this matter to you, so

I’m bringing it to you myself. This way, you can still prosecute the case.” Such

z

matter to the Attorney General for criminal investigation, but only after the FEC |



S3.$t4y

S58 + FANS

+ TFLEPHONE 1238. 388 5

HOW WEST TEN MILE ROAD © SOUTHIIELD MICTIGAN 48075-2465,

TIEGPR, FIFGER KENNEY JOHNSON & GIROLX + 4 PROFESSIONAL CORPORATION + ATTORNEYS AND COUINSFLORS ATLAW +

nighttime raid of Fieger’s law offices, as well at the homes of all the employees.
This unprecedented nighttime raid upon a prominent Democrat’s law office was
specifically authorized by Defendant Gonzales. Since January 2006, many of
these employees, family members, and friends of the Fieger firm have been
compelled to testify before a federal grand jury. During the grand jury
proceedings, the Attorney General’s agents compelled and coerced witnesses to
disclose for whom they voted in the 2004 election and their entire history of
campaign contributions.

On February 1, 2006, counsel to the Fieger Firm sent a letter to FEC
Chairman Michael E. Toner demanding that the Commission comply with the
provisions of 2 U.S.C. § 437g under which the FEC must first conduct its own
investigation before voting to refer the matter to the Attorney General for a
criminal investigation (R.4, Plaintiffs’ Motion for Declaratory Judgment, Ex. A,
Letter to Michael Toner, Apx. __).

Around September 2006, the Federal Election Commission began its own
investigation into whether the Fieger law firm, including its employees and
associates, had violated the Act (R.4, Plaintiffs’ Motion for Declaratory
Judgment, Ex. B, Letter from Michael Toner, Apx. _). Since September 2006,

however, the FEC has failed to conduct its statutorily required duties because

-8-



TABLE OF CONTENTS

INDEX OF AUTHORITIES ........... 0000.0 iv
STATEMENT IN SUPPORT OF ORAL ARGUMENT ............-. vil
JURISDICTIONAL STATEMENT ..............000 000. c eee eee 1

STATEMENT OF THE ISSUE..... 0... eee eee 2

STATEMENT OF THE CASE ........ 0.0000 cee eee eee 3

STATEMENT OF FACTS .... 22.00.0200 0 02 e ec eee eee 7
District Court Proceedings and Order ...........0.0 0000 eee eee 9

STANDARD OF REVIEW .... 0.000002 11

ARGUMENT ... 2. 12
I. The Federal Election Commission Has Primary and

&
&

Exclusive Jurisdiction Over the Federal Election Campaign
Act. Only By An Affirmative Vote of a Majority of Four
Members May the Commission Refer to the Attorney
General Knowing and Willful Violations of the Act.
Without a Referral By the FEC, the Attorney General Has
No Jurisdiction to Investigate or Prosecute Suspected
Campaign Finance Violations ...............0..0000008 12

5
g
g
E
g
E
g
&

A. The 1976 Amendments to the Act show that congress
fully intended to depoliticize campaign finance
disputes by taking them away from the purview of the
Attorney General and placing them in the first
instance within the “exclusive primary” jurisdiction of
the FEC 21... 16

PIFGER, PIEGER, KENNEY JOBNSON & GIROL © 4 PROFESSIC



sfaX dunes tly =

| ATEEPHOSL 2ass 185 856

FIEGPR FIFGER. KENNEY JOHNSON & GIROU + A PROFESSIONAL CORPOR YTION + ATTORNEYS AND COUNSELORS ATLAW. + 1989) WEST TES WILE ROAD © SOUTHIBIL(D MICHIGAN 48175 2463

criminal prosecution and punishment appears to have been real and substantial,
not ‘merely trifling or imaginary.”” /d. at 255 (citing Marchetti v. United States,
390 U.S. 39 (1968)). So it is here.

An Attorney General’s ‘concurrent’ investigation of the same facts and
circumstances that serve as a basis for an FEC investigation would act as an
illegal whipsaw under which the Attorney General simply sits back while the |
FEC uses its congressionally authorized subpoena power to compel arespondent
into self-incrimination. Such a shameless result is totally repugnant to the most |
basic principles of constitutional jurisprudence. See Murphy v. Waterfront
Comm'n of New York Harbor, 378 U.S. 52 (1964). As Justice Frank Murphy
aptly stated:

The immediate and potential evils of compulsory self-
disclosure transcend any difficulties that the exercise
of the privilege may impose on society in the
detection and prosecution of crime. While the
privilege is subject to abuse and misuse, it is firmly
embedded in our constitutional and legal frameworks

as a bulwark against iniquitous methods of
prosecution.

United States v. White, 322 U.S. 694 (1944).
Here, the Attorney General [with the tacit approval of the FEC} is
attempting to gut those provisions of the Act designed specifically to thwart the

intolerable situation now created. The Attorney General’s proposed statutory

-29-



the Attorney General by a bipartisan majority vote. The FEC’s exclusive

jurisdiction is further buttressed by the fact that, from 1971 until 1976, Congress
left certain campaign finance violations in Title 18 (like the current § 441a
which limits individual contributions to federal campaigns) where those
violations could be independently prosecuted by the Attorney General without
regard to the FEC and its jurisdiction.

B. Testimony from the Senate Floor confirms that Congress
intended to restrict the Attorney General from independently
investigating violations of the Act absent a bipartisan referral
from the Commission.

Because the 1976 amendments required a referral] from the FEC before

the Attorney General could initiate criminal proceedings, the amendments

RS AL LAW ©

received some opposition from members of Congress. Specifically, Senator
Brock opposed passage of the 1976 amendments because of the restriction
placed on the Attorney General’s ability to prosecute without referral from the
FEC. Ina Senate debate on thc amendments, Brock remarked that:

Equally bad, the Justice Department is no longer able
to prosecute on its own. If an aggressive district
attorney finds a clear violation of the law, he cannot
take the person into court. He must refer the case to
the Federal Election Commission. And what if this
agency, which Congress has neatly overtaken,
imposes nothing but a simple fine? That is it. The
Justice Department can take no further action even if
it violently disagrees with the decision.

-|7-

FIEGER. FIFGER, KENNEY. JOHKSOV & GIROLX + \ PROFESSIONAL CORPORATION + ATTOR



UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT

This statement should be placed immediately preceding the table of contents in the brief of the party. See copy
of the 6th Cir. R. 26.1 on page 2 of this form. Sign and date this form.

Geoffrey N. Fieger, et al.

v.

U.S. Attorney General Alberto R. Gonzales, et al.

DISCLOSURE OF CORPORATE AFFILIATIONS
AND FINANCIAL INTEREST

Pursuant to 6th Cir. R. 26.1, Geottrey N. Fieger; Nancy Fisher; Fieger, Fieger, Kenney & Johnson, P.C.
Name of Party

makes the following disclosure:

1. Is said party a subsidiary or affiliate of a publicly owned corporation? If Yes, list below the identity of

the parent corporation or affiliate and the relationship between it and the named party:
No.

2. Is there a publicly owned corporation, not a party to the appeal, that has a financial interest in the

outcome? If yes, list the identity of such corporation and the nature of the financial interest:
No.

° ZZ December 28, 2007

Signature of, sel

Date

6CA-1 (Over)
Page |


HAN DIN ISS $y

(8 © LE LLPHHONL 23598 9858

f9300 WEST TEN ALF ROAD © SOL RIHIELD: MICHIGAN 48

FIEGCR FIEGER KENNEY. JOHNSON & GIROUN + A PROFESSION AL CORPORATION + APTORNEYS AND COUNSELORS 1 LAW +

138 F.3d 144 (Sth Cir. 1998), where the Fifth Circuit adopted the FEC’s theory
that only an administrative complainant may file suit under the APA. There, the
court rejected Stockman’s APA claim “because the [Campaign] Act creates a
cause of action for unreasonable delay for the complainant alone (Stockman is
the respondent in the FEC investigation), and even then, the claim must be
brought in the District of Columbia.”

Thus, the Fifth Circuit concluded that the Campaign Act’s creation of a
cause of action for an administrative complainant displaced, or repealed, the
APA as to any and all other individuals. To date, the erroneous Stockman
decision has never been followed by another circuit court in the country.
Indeed, even a cursory reading of the United States Supreme Court’s decision
in Norton reveals the infirmity of the FEC’s argument as adopted by the Fifth
Circuit in Stockman.

Inan APA claim, Norton instructs the lower federal courts to first identify
the relevant statutc that requires a federal agency to perform certain acts. In this
case, 2 U.S.C. § 437g(a)(2) is the relevant statute that provides that once the
FEC has found reason to believe that a violation of the Act has been committed,
the “Commission shall make an investigation of such alleged violation.”

Relying on § 437g(a)(2) as the relevant statute, the APA acts as a waiver of

-4]-



3 The Attorney General has no interest in a defendant using a conciliation
agreement as exculpatory evidence in a criminal proceeding. Thus, if a referral
were not required, the Attorney General could circumvent the law by simply
initiating a criminal charge before the FEC ever reaches a conciliation
agreement. Such duplicity would be an end-run around the statute. By enacting
§ 437g(d)(2), Congress required that the FEC investigate alleged violations of
the Act in the first instance, and the Attorney General may investigate or charge
only after a referral by a bipartisan majority vote of the Commission.

The history of the Act from its inception unequivocally supports this

conclusion. At the time the Act was originally passed, most of the substantive |

restrictions on campaign finance were contained in the federal penal code. In

‘SFLORS \TLAW +

1974, Congress created the FEC and left the substantive restrictions on

Campaign finance in the penal code. This fact demonstrates that in 1974 |

E

Congress fully intended to allow the Attorney General to continue investigating
and prosecuting suspected campaign finance violations even after it created the
FEC.

In 1976, Congress removed the issues related to campaign finance from
the penal code and shifted them to the Campaign Finance Act making them

subject to the FEC’s oversight, interpretation, and enforcement. Since 1974,

-25-

FIEGLR FIEGER KENNEY JOHNSON & GIROLX + 4 PROFESSIONAL CORPORATION



TELEPHONE (2a) 155 $855

ORS ATLAW © 1OWHIWEST TL MILL ROAD + SOU THIMLLD: MICHIGAN 4x0

FIEGER, FIEGER. KENNEY, JOHNSON & GIKOL' + 4 PROFESSIOVAL CORPORATION © \TTORNEYS AND COURS

enforcement of the Act. Congress intended to avoid this quagmire completely
by plainly writing a statute which mandates that the FEC has the first
opportunity to consider the conduct or transaction and decide whether to refer
the matter to the Attorney General. The plain wording of the Act conclusively
establishes that congress intended the FEC to exercise “exclusive” jurisdiction
over the investigation of a// alleged violations of the Act before the Attorney

General can ever initiate a criminal investigation.

il. Under Section 706 of the Administrative Procedures Act, a District
Court Has Jurisdiction to “Compel Agency Action Unlawfully
Withheld or Unreasonably Delayed.” Contrary to the Terms of the
APA, the District Court Erroneously Concluded That it Lacked

Jurisdiction Under the APA to Compel the FEC to Comply With the
Law.

The Attorney General’s extra-jurisdictional and unconstitutional
investigation, while egregious in and of itself, could not have been carried out
without the tacit assistance of the Federal Election Commission, or its politically
motivated Chairman, Michael Toner. In order to aid the Attorney General, the
facts in this case show that FEC Chairman Toner waited quietly on the sidelines
so as not to impede or hamper the Attorney General’s extra-jurisdictional
investigation. But this is not how the law works.

The Act imposes upon the FEC an affirmative duty to conduct its own
investigation once it has determined, by an affirmative vote of 4 of its members,

34-



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violation, and every 30 days thereafter until the final disposition of the apparent
violation.” 2 U.S.C. § 437g(c). This new provision requiring the Attorney
General to file reports after a referral from the FEC dispels any argument by the
Attorney General that the Act only applies to the FEC and does not impose any
restrictions or duties on the office of the Attorney General.’ By this statutory
scheme, congress mandates that a// alleged violations of the Act first be
considered by the FEC which possesses the so/e discretion to later allow the
Attorney General to investigate.

Significantly, in 1980, congress also amended the Act to allow an
individual who may be subsequently charged criminally (after a referral by the
FEC) to “introduce as evidence a conciliation agreement” to demonstrate his
lack of knowledge or intent to commit the alleged violation. 2 U.S.C. §
437g(a)(4)(A)(i); Pub. L. No. 96-187; 93 Stat. 1361-62 (effective January 1980).
This amendment clearly demonstrates congress’s intent to establish a sequence
of events under which the FEC first attempts to resolve alleged violations prior

to a referral to the Attorney General.

> Under the Attorney General’s misguided argument, he can undermine
and circumvent his reporting obligations under the Act by simply initiating all
investigations of campaign finance violations himself, thereby avoiding the
Act’s requirement to issue periodic reports to the FEC.

-20-



SPAN RUSS

+ TEL PPHOSE 238138

S63

&

ATION © ATTORNEY AND COUNSELORS ATL AW +

FIFGER, PIEGER KENNEY JOHKSON & GIROUX © 4 PROF

including the Attorney General), and that the Attorney General would

investigate only after receiving a referral from the FEC.

In this case, the Attorney General began what is believed to be the largest |

campaign finance investigation in the history of America targeting dozens of
individuals, including Plaintiffs, who contributed to the John Edwards 2004
presidential campaign. The Attorney General began this investigation without
ever having received the statutorily required referral from the FEC. About a
year later, the FEC began its own investigation but has since sat out on the
sidelines because the Attorney General has stripped the FEC of its “exclusive”
civil jurisdiction. In short, the Attorney General, with the tacit approval of the
FEC, has circumvented the jurisdictional requirements of the Act and reversed
the congressional sequence of the Act.

The Attorney General and FEC contend, however, that they have acted
properly because the FEC has “civiJ” jurisdiction while the Attorney General has
“criminal” jurisdiction, but this is not the specific issue before the Court.
Plaintiffs do not dispute that the FEC has civil jurisdiction or that the Attorney
General has criminal jurisdiction. The issue presented is an issue of sequence,
that is, who exercises jurisdiction in the first instance. Congress clearly and

expressly answered this question by granting the FEC exclusive civil jurisdiction

4.



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O24 WEST TN MILL ROAD

FIRGER PIEGER KENNEY JOHNSON & GIROLA + \ PROFESSIONAL CORPORATION + \TTORNEYS AND COL NSELORS (TL +

sovereign immunity allowing “a person suffering legal wrong . . . to [seek] -
judicial review thereof.” 5 U.S.C. § 702. Finally, 28 U.S.C. § 1331 opens the
jurisdictional door to the courthouse.’

The Act requires the FEC to conduct an investigation, but they cannot do
so because the Attorney General has effectively stripped it of its “exclusive civil
jurisdiction.” To get around this obvious problem, the FEC simply claims that
there are no time lines in which it must act under the law and therefore
Plaintiffs’ claims under the APA fail. The problem with the FEC’s argument,
however, is that the statute compels it to conduct some sort of investigation.°
Plaintiffs are not asking the Court to micro-manage the manner in which the
FEC performs its duties, but rather ask the Court to compel the FEC to follow
the law.

The FEC either cannot do so, or does not want to because the Attorney

General has stripped it of its ability to exercise its exclusive jurisdiction. And

> Neither § 437g of the FECA nor § 706 of the APA grant jurisdiction.
Jurisdiction is granted under the general federal question statute found at 28
U.S.C. § 1331. The APA acts as a waiver of sovereign immunity allowing an
aggrieved party to file suit against an agency of the United States.

° The FEC’s argument is a classic argument of form over substance. As
a formality, and in response to Plaintiffs’ claims, the FEC mysteriously claims
that it may be conducting some sort of investigation of which Plaintiffs are
unaware. In substance, however, the FEC is not conducting any investigation.

-42-



+ TELEPHONE 245)

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Attorney General has no jurisdiction to investigate or prosecute suspected
campaign finance violations.

It is important to stress that the activity of the Attorney General as
documented here is unlike ever before. For nearly 30 years, virtually all
campaign finance cases have been resolved by the FEC — not the Justice
Department. The FEC is willfully failing to comply with the requirements of the
Federal Campaign Finance Act in order to assist the Attorney General to engage
in an extra-jurisdiction, politically motivated investigation.

Accordingly, Plaintiffs’ respectfully requests that this Honorable Court
reverse the judgment of the district court and grant their motion for declaratory
judgment.

Respectfully submitted,

FIEGER, FIEGER, KENNEY, JOHNSON
& GIROUX, P.C.

LAE
MICHAEL R. DEZSI 764530)
Attorneys for Plaintiffs-Appellants
19390 W. Ten Mile Road
Southfield, MI 48075
(248) 355-5555

Dated: December 28, 2007

-44-



+ PAN unt 58.5146

TELFPHONE 1219) 358-5855

SOU PHPIELD. Mt

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FI:GLR FIEGER. KENNEY JONNSON & GIROUX + 4 PROFESSIONAL CORPORATION + 4CTORNEYS 4\D CO

an interpretation of the Act renders meaningless the bipartisan referral
mechanism enacted by Congress.

For the following reasons, Plaintiffs’ respectfully request that this
Honorable Court reverse the judgment of the district court, and grant their
motion for declaratory relief consistent with the congressional mandate
contained in the Act.

STATEMENT OF FACTS

Sometime during the summer of 2005, a former disgruntled employee of
the Michigan law firm of Fieger, Fieger, Kenney & Johnson, P.C. contacted the
Detroit office of the FBI falsely claiming that he had been forced by the firm
partners to contribute to the presidential campaign of Senator John Edwards.
Instead of referring the matter to the Federal Elections Commission, which
under the statute has original and exclusive jurisdiction in the first instance to
investigate campaign finance issues, the Attorney General began an invasive and
illegal investigation of every Fieger Firm employee and their families. Geoffrey
Fieger is the President of the Fieger law firm, and Nancy Fisher is the firm’s
Office Manager.

On November 30, 2005, in a highly publicized media event, federal

prosecutors, accompanied by nearly 100 federal agents, led an unprecedented