b'Indemnification of Treasury Department Officers and\nEmployees\nT h e D epartm ent o f Treasury m ay use its general appropriations funds to indem nify any o f its\nofficers and em ployees against personal liability for conduct arising out o f actions taken\nw ithin the co u rse and scope o f their em ploym ent, if the D epartm ent concludes that such\nindem nification is necessary to ensure effective perform ance o f the D epartm ent\xe2\x80\x99s m ission.\n28 U .S.C . \xc2\xa7 2 0 0 6 and 26 U .S.C. \xc2\xa7 7423(2) also provide specific authority for the D epartm ent o f\nthe T reasury to indem nify, in certain circum stances, officers and em ployees w ho collect tax\nrevenue and w h o enforce federal tax laws.\n\nMarch 4, 1991\nM e m o r a n d u m O p i n io n f o r t h e G e n e r a l C o u n s e l\nD epa rtm en t o f th e T rea su ry\n\nThis memorandum responds to your request for our opinion whether the\nDepartment o f the Treasury (\xe2\x80\x9cTreasury\xe2\x80\x9d) may expend funds generally appro\xc2\xad\npriated to departmental \xe2\x80\x9csalaries and expenses\xe2\x80\x9d accounts to indemnify officers\nand employees against personal liability for actions taken within the course\nand scope of their employment. We agree with your conclusion that the\nDepartment of the Treasury has the authority to indemnify its officers and\nemployees against personal liability for such conduct if it concludes that\nsuch indemnification is necessary to ensure effective performance of the\nDepartment\xe2\x80\x99s mission. Letter for William P. Barr, Assistant Attorney Gen\xc2\xad\neral, Office of Legal Counsel, from Robert M. McNamara, Jr., Assistant\nGeneral Counsel, Department of the Treasury, (Jan. 16, 1990).\nSection 2006 of title 28, United States Code, and section 7423(2) of title\n26, United States Code, specifically authorize Treasury to indemnify those\nofficers and employees who are sued for actions taken while enforcing the\nInternal Revenue Code. These statutes apply equally to all Treasury em \xc2\xad\nployees who collect tax revenue and who enforce federal tax laws. The\nDepartment of the Treasury also has the authority to expend funds from its\ngeneral operating appropriations to defray necessary departmental expenses,\nbecause the Secretary may determine, as a general matter, that effective perfor\xc2\xad\nmance of Treasury\xe2\x80\x99s duties requires the Department to adopt an indemnification\n57\n\n\x0cpolicy covering all Department personnel for actions taken during the course\nand scope of their employment.\n\nI.\nThe Department o f the Treasury currently comprises the Departmental\nOffices, the Treasury of the United States, the Bureau of Engraving and\nPrinting, the Bureau of the Mint, the Federal Financing Bank, the Fiscal\nService, the Office of the Comptroller of the Currency, the Customs Service,\nthe Internal Revenue Service, the Bureau of Alcohol, Tobacco, and Firearms,\nand the Secret Service. The Department performs both administrative and\nlaw enforcement functions. See section III, infra.\nBecause Treasury performs an increasing amount of law enforcement work,\nthe personal liability of Department personnel has become a significant con\xc2\xad\ncern.1 The Supreme Court\xe2\x80\x99s decision in Bivens v. Six Unknown Named Agents,\n403 U.S. 388 (1971), permits courts to award damages against a federal\nemployee personally if, during the course and scope of employment, the\nemployee violates an individual\xe2\x80\x99s constitutional rights.\nThis Office has previously addressed the question whether the Depart\xc2\xad\nment o f Justice may protect its employees by indemnifying them from personal\nliability for actions taken in the course and scope of their employment.2\nBased upon the accepted principle that an agency may use generally appro\xc2\xad\npriated funds to defray expenses that are necessary or incident to the\nachievement of the agency\xe2\x80\x99s mission and the objectives underlying the appro\xc2\xad\npriation, we concluded that Justice is authorized to indemnify its employees\nbecause a clear connection exists between indemnification of the agency\xe2\x80\x99s\nemployees and achievement o f Justice\xe2\x80\x99s underlying mission. See 10 Op.\nO.L.C. at 8-9.3 Shortly thereafter, the Department of Justice issued a policy\nstatement describing the circumstances under which it would indemnify its em\xc2\xad\nployees. See 51 Fed. Reg. 27,021 (1986); 28 C.F.R. \xc2\xa7 50.15 (1990).\nFollowing the Department of Justice\xe2\x80\x99s lead, and referencing its rationale\n\' W hen Congress enacted the Federal Tort Claims Act (\xe2\x80\x9cFTCA"), 28 U.S.C. \xc2\xa7\xc2\xa7 2671-2680, which\nwaived governm ent imm unity in particular cases for torts committed by federal officers and employees,\nthe num ber o f tort suits against individual officers and employees decreased. In some instances, the\nFTCA m akes suits against the government the only federal remedy available after a litigant has pursued\nadm inistrative actions against the em ployee 28 U.S.C. \xc2\xa7 2675. Therefore, when this memorandum\naddresses indem nification o f officers and employees for actions taken within the course and scope of\nem ploym ent, it necessarily excludes from coverage all of those actions for which the governm ent is\nalready liable under the FTCA.\n2 Indem nification o f Department o f Justice Employees, 10 Op. O.L.C. 6 (1986); Memoranda for Alice\nD aniel. Assistant Attorney General, C ivil Division, from John M. Harmon, Assistant Attorney General.\nOffice o f Legal Counsel (Aug. 15, 1980 and Aug. 22, 1980) (\xe2\x80\x9cDaniel Memoranda\xe2\x80\x9d ).\n3 The Attorney G eneral\xe2\x80\x99s plenary authority to litigate or otherwise resolve cases involving the United\nStates and its em ployees provides an alternative ground for our conclusion that the Department of\nJustice can indem nify its employees. See 10 Op. O.L.C. at 6-7. See 5 U.S.C. \xc2\xa7 3106; 28 U.S.C. \xc2\xa7\xc2\xa7 516,\n519; Settlem ent A uthority o f the United Stales in Oil Shale Cases, 4B Op. O.L.C. 756 (1980). However,\nthe prim ary rationale supporting our conclusion continues to be the authority of an agency to expend\nappropriated funds in accordance with the mission of the agency and the objectives underlying the\nappropriation The application of this rationale is not limited to the Department o f Justice.\n\n58\n\n\x0cfor indemnification as reflected in Justice\xe2\x80\x99s policy statement,4 eleven other\nagencies and departments have instituted employee indemnification programs.5\nAt least two more plan to activate such programs in the near future.5\n28 U.S.C. \xc2\xa7 2006 and 26 U.S.C. \xc2\xa7 7423(2) provide specific authority for\nTreasury to indemnify those officers and employees who enforce the Inter\xc2\xad\nnal Revenue Code. Section 2006, the narrower of these two provisions,\nrequires Treasury to indemnify \xe2\x80\x9ccollectors] or other revenue officer[s]\xe2\x80\x9d for\njudgments awarded against them personally for official actions, upon court\ncertification that probable cause existed for, or that the Secretary of the\nTreasury directed, the action.7 If indemnification is warranted, Treasury\nmust pay the judgment out of the \xe2\x80\x9cproper appropriation.\xe2\x80\x9d Because any\nrecovery would be awarded against the individual employee, the judgment\nfund, 31 U.S.C. \xc2\xa7 3104(a), which is only available to meet judgments against\nthe United States, would be unavailable.8 Payment should be made from a\nTreasury appropriation.\nTreasury also retains discretionary authority, under 26 U.S.C. \xc2\xa7 7423(2),\nto indemnify any United States officer or employee for \xe2\x80\x9c[a]ll damages and\ncosts recovered against [him] . . . in any suit brought . . . by reason of\nanything done in the due performance of his official duty under [the Internal\nRevenue Code].\xe2\x80\x9d Because this section was intended broadly \xe2\x80\x9cto exempt\nany Government officer or employee from liability for civil damages recov\xc2\xad\nered against him in the performance of his official dut[ies] [under] . . . the\ninternal revenue laws,\xe2\x80\x9d9 it omits the prerequisites for indemnification contained\n\n4 55 Fed. Reg. 4609 (1990) (Interior); 54 Fed Reg. 25,233-34 (1989) (Commodity Futures Trading\nCom m \xe2\x80\x99n); 54 Fed. Reg. 7148 (1989) (Education); 54 Fed Reg. 5613 (1989) (Veterans Admin.); 53 Fed.\nReg. 29,657 (1988) (Agency for Int\xe2\x80\x99l Dev.); 53 Fed. Reg. 27,482 (1988) (N at\xe2\x80\x99l Aeronautics and Space\nAdmin.); 53 Fed. Reg. 11,279-80 (1988) (Health and Human Services); 52 Fed. Reg. 32,533 (1987)\n(Small Business Admin.).\n5 12 C.F.R. \xc2\xa7 7.5217 (1990) (N at\'l Banks, as administered by the Comptroller of the Currency); 12\nC.F.R. \xc2\xa7 701.33 (1990) (Fed. Credit Unions); 13 C.F.R. \xc2\xa7\xc2\xa7 114.110 (1990) (Small Business Admin.); 14\nC.F.R. \xc2\xa7 1261.316 (1990) (Nat\xe2\x80\x99l Aeronautics and Space Admin.); 17 C.F.R. \xc2\xa7\xc2\xa7 142 1-142.2 (1990)\n(Commodity Futures Treading Com m \'n); 22 C.F.R. \xc2\xa7 207 01 (1990) (Agency for Int\xe2\x80\x99l Dev.); 32 C.F.R.\n\xc2\xa7\xc2\xa7 516.72, 55 Fed. Reg. 10,371-72 (1990) (Army, Dep\xe2\x80\x99t of Defense); 34 C.F.R. \xc2\xa7\xc2\xa7 60.1-60.2 (1990)\n(Education): 38 C .F R . \xc2\xa7 14.514(c) (1989) (Veterans Affairs); 43 C.F.R. \xc2\xa7 22.6, 55 Fed. Reg. 4609\n(1990) (Interior); 45 C.F.R. \xc2\xa7 36.1 (1989) (Health and Human Services).\n6 54 Fed. Reg. 17,549 (1989) (to be codified at 12 C.F.R. \xc2\xa7 522.72) (Fed. Home Loan Banks); 54 Fed.\nReg. 16,613 (1989) (to be codified at 10 C.F.R. \xc2\xa7 1012) (Dep\'t of Energy).\n7 Congress enacted this section to combat rampant fraud against the Treasury. Act of M arch 3, 1863,\nch. 76, sec. 12, 12 Stat. 737, 741 (1863). Prior to 1863, collectors retained disputed governm ent\nrevenue until a court could resolve all taxpayer protests. To encourage collectors to deposit federal\nrevenues in the Treasury. Congress required the government to indemnify collectors against personal\nliability for actions taken during collections. United States v. Kates, 314 U.S. 186, 198 (1941); Moore\nIce Cream Co. v. Rose, 289 U.S. 373, 380 (1933). Virtually unmodified since 1863, this section is used\nprimarily to indemnify Customs Service employees. See Kosak v. United States, 465 U.S. 848, 860\n(1984); States M arine Lines, Inc. v. Shultz, 498 F 2 d 1146, 1149-51 (4th Cir. 1974)\n\xe2\x80\xa2 See United States v. Nunnally Inv. Co., 316 U.S. 258. 263-64 (1942), Kales, 314 U.S. at 198-99\n(1941); Sage v. United States, 250 U.S. 33. 37 (1919).\n9 56 Comp. Gen. 615, 616-17 (1977) quoting; 53 Comp. Gen. 782, 783-84 (1974); see also 40 Comp.\nGen. 95. 97 (1960).\n\n59\n\n\x0cin section 2006, requiring only that personal liability result from official\nactions. As with section 2006, all reimbursable judgments must be rendered\npersonally against government personnel, and should be paid from Treasury\xe2\x80\x99s\ngeneral appropriations rather than from the judgment fund.10 As a practical\nmatter, more indemnification will occur under this section than under sec\xc2\xad\ntion 2006, because section 7423(2) contains less restrictive prerequisites.\nHowever, both statutes authorize indemnification of only those Treasury em\xc2\xad\nployees who enforce or administer the Internal Revenue Code.\nih l\n\nBeyond this specific indemnification authority, we also conclude, in ac\xc2\xad\ncordance with our previous opinion regarding the Department of Justice,\nthat the Department of the Treasury has general authority to indemnify its\nemployees because it could determine that indemnification is related both to\nits mission and to the objectives underlying its general appropriation. See\n10 Op. O.L.C. 6; Daniel Memoranda.\nAs with the Department of Justice, Treasury may expend generally appro\xc2\xad\npriated funds for indemnification only if those expenditures constitute\n\xe2\x80\x9cnecessary expenses\xe2\x80\x9d which advance Treasury\xe2\x80\x99s broader statutory mission,\nand which fall within the spending limits set by Congress. See 10 Op.\nO.L.C. at 8-9; 31 U.S.C. \xc2\xa7 1301(a) (\xe2\x80\x9cAppropriations shall be applied only to\nthe objects for which the appropriations were made except as otherwise\nprovided by law.\xe2\x80\x9d); Principles o f Federal Appropriations Law 3-2 to 3-9, 312 (GAO 1982) (\xe2\x80\x9cPrinciples\xe2\x80\x9d). A particular expenditure satisfies these\nrequirem ents if it: 1) directly accomplishes the specific congressional pur\xc2\xad\npose underlying the appropriation; 2) incidentally accomplishes a specific\ncongressional purpose; or, 3) is generally \xe2\x80\x9cnecessary\xe2\x80\x9d for the realization of\nbroader agency objectives covered by the appropriation. Principles at 3-12,\n3-13; See also 68 Comp. Gen. 583, 585 (1989) (\xe2\x80\x9cEven though a particular\nexpenditure may not be specifically provided for . . ., the expenditure \xe2\x80\x98is\nperm issible if it is reasonably necessary in carrying out an authorized func\xc2\xad\ntion or will contribute materially to the effective accomplishment of that\nfunction.\xe2\x80\x99\xe2\x80\x9d ) (quoting 66 Comp. Gen. 356, 359 (1987)).11\nN um erous precedents recognize a general nexus between an agency\xe2\x80\x99s\n\n10 T he C om ptroller General has interpreted section 7423(2) to specifically authorize the use o f general\nappropriations. 56 Com p. Gen. at 619-20 (overruling contrary decision in 40 Comp. Gen. 95, 97\n(I9 6 0 )). Ft m ust be noted that, within the executive branch, decisions of the Com ptroller General, an\nagent o f C ongress, are not binding, and operate only as persuasive authority. See Bowsher v. Synar, 478\nU.S. 714, 728-32 (1986). Nevertheless, where possible, the executive branch will accord deference to\nthe C om ptroller G eneral\xe2\x80\x99s opinions.\n" T hrough line item s in the Treasury Appropriations Act of 1991, Congress appropriated funds to\ndefray departm ental salaries and expenses. Pub. L. No. 101-509, 104 Stat. 1389 (1990). Thus, Trea\xc2\xad\nsury has m oney available in its general accounts to expend for indemnification.\n\n60\n\n\x0cmission and indem nification of that agency\xe2\x80\x99s personnel.12 As early as 1838,\nAttorney General Butler authorized the Navy to pay a judgment rendered\nagainst a naval officer:\nThe recovery was for acts done by Commodore Elliot in the\nperformance of his official duty, and for costs occasioned by\nthe defence made by the United States. It is therefore one of\nthose cases in which the officer ought to be fully indemnified.\n3 Op. Att\xe2\x80\x99y Gen. 306 (1838).13 Similarly, the Comptroller General advised\nthe Department of the Interior to defray a personal judgment rendered against\ntwo game wardens who had entered private land at the direction of their\nsuperior officers:\nThey were required to act in the line of duty, and they in\xc2\xad\ntended faithfully to carry out the law enforcement activity of\nthe Bureau. Under these circumstances, and especially since\nthey were directed by their superiors, the Government is obli\xc2\xad\ngated to compensate them. . . .\n. . . Accordingly, reimbursement to the claimants should be\ncharged to the Department of the Interior appropriation avail\xc2\xad\nable to the B ureau for necessary expenses o f its law\nenforcement program.\nSee Comp. Gen. B-168571-O.M. at 2-3 (1970).14\n12 We agree with your conclusion that the specific indemnification statutes discussed in section II fail\nto support a negative inference that indemnification is unauthorized unless expressly provided for by\nlaw. Rather, these provisions address specific congressional objectives, and do not represent an affir\xc2\xad\nmative congressional decision that indemnification o f Department of the Treasury em ployees is not\nappropriate even if it is deem ed necessary to promote the general efficiency o f the Department. 28\nU.S.C. \xc2\xa7 2006 requires mandatory rather than discretionary indemnification when specified conditions\nare met, in order to facilitate a decision to have government rather than revenue agents control the sum s\ncollected as government revenue. See supra note 8, 26 U.S.C. \xc2\xa7 7423(2) is not specifically focused on\nthe Department o f the Treasury, but permits indemnification o f all tax enforcement personnel, whether or\nnot those employees work for Treasury.\n15 See also Tracy v. Swartwout, 35 U.S. 80, 98-99 (1836) (\xe2\x80\x9cSome personal inconvenience may be\nexperienced by an officer who shall be held responsible in damages for illegal acts done under instruc\xc2\xad\ntions o f a superior; but, as the government in such cases is bound to indemnify the officer, there can be\nno eventual hardship.\xe2\x80\x9d); 53 Comp. Gen. 3 0 1, 305 (1973) (\xe2\x80\x9cIt is well established that where an officer of\nthe United States is sued because of some official act done in the discharge o f an official duty the\nexpense of defending the suit should be borne by the United States.\xe2\x80\x9d).\n14 The Com ptroller General has usually reached similar conclusions concerning the availability o f\ngeneral appropriations to pay for indemnification. See 10 Op. O.L.C. at 11-12. On occasion, the\nCom ptroller General has suggested that indemnification requires specific statutory authorization. See\n56 Comp. Gen. 615, 618 (1977); 40 Comp. Gen. 95, 97 (I960). Each o f these opinions begins from the\npremise that:\n[Tjhe appropriations or funds provided for regular governmental operations or activities,\nout o f which a cause o f action arises, are not available to pay judgm ents o f courts in the\nContinued\n\n61\n\n\x0cTwo distinct rationales are available to support your conclusion that in\xc2\xad\ndemnification of Treasury officials is appropiate. Treasury may conclude\nthat its ability to attract qualified employees is threatened by applicants\xe2\x80\x99\nfears that they risk personal financial liability for actions taken in the course\no f government employment. See Harlow v. Fitzgerald, 457 U.S. 800, 814\n(1982) (\xe2\x80\x9cThe[] social costs [of constitutional claims against government offi\xc2\xad\ncials] include the expenses o f litigation, the diversion of official energy from\npressing public issues, and the deterrence o f able citizens from acceptance o f\npu b lic office.") (emphasis added).\nTreasury may also conclude that the willingness of its employees, once\nhired, to make difficult government decisions, to perform fully the functions\nassigned to them, and to follow orders issued by their superiors, will depend\nupon the extent to which the employees fear personal liability imposed in \xe2\x80\x9ca\nlawsuit arising out of the good faith performance of their jobs.\xe2\x80\x9d 67 Comp.\nGen. 37, 38 (1987). The Supreme Court has repeatedly recognized the chill\xc2\xad\ning effect which the threat o f litigation exerts on government employees:\n\xe2\x80\x98In exercising the functions of his office, the head of an Ex\xc2\xad\necutive Department, keeping within the limits of his authority,\nshould not be under an apprehension that the motives that\ncontrol his official conduct may, at any time, become the sub\xc2\xad\nject of inquiry in a civil suit for damages. It would seriously\ncripple the proper a n d effective administration o f public af\xc2\xad\nfa irs as entrusted to the executive branch o f the government,\nif he were subjected to any such restraint.\xe2\x80\x99\nB arr v. M atteo, 360 U.S. 564, 570 (1959) (emphasis added) (quoting Spalding\nv. Vilas, 161 U.S. 483, 498-99 (1896)). See Westfall v. Erwin, 484 U.S. 292,\n295 (1988); H arlow, 457 U.S. at 814. See also Anderson v. Creighton, 483\n\nU.S. 635, 638 (1987) (\xe2\x80\x9c[F]ear of personal monetary liability and harassing\nlitigation will unduly inhibit [FBI agents] in the discharge of their duties\xe2\x80\x9d).\nIn light of the potential threat posed to Treasury\xe2\x80\x99s law enforcement and\nadministrative missions by the prospect of personal employee liability, Trea\xc2\xad\nsury may conclude that, by removing this threat, personnel indemnification\nfacilitate s D epartm ental o b jectiv es.15 See W estfall, 484 U.S. at 295\nM(....continued)\nabsence o f specific provision therefor.\n56 Com p. Gen. at 618; 40 Comp. Gen. at 97. However, these statements are dicta because the Com ptrol\xc2\xad\nler G eneral was construing the specific indemnification provision in 26 U.S.C. \xc2\xa7 7423, and thus did not\nhave to consider whether indemnification of officials was justified as an expense necessary to the general\nefficiency o f the Departm ent.\n15\nT hreats o f personal liability for official conduct have confronted Treasury personnel: Internal\nRevenue Service, G.M. Leasing Corp. v. United States, 429 U.S. 338 (1977), National Commodity and\nB arter A s s \xe2\x80\x99n v. Gibbs, 886 F.2d 1240 (10th Cir. 1989), Liffiton v. Keuker, 850 F.2d 73 (2d Cir. 1988);\nCustom s Service, Nathanson v. United States, 290 U.S. 41 (1933), Seguin v. Eide, 720 F.2d 1046 (9th\nCir. 1983); Secret Service, Peppers v. Coates, 887 F.2d 1493 (11th Cir. 1989), Galella v. Onassis, 487\nF.2d 986, (2d Cir. 1973) (\xe2\x80\x9cThe protective duties assigned the [secret service] agents under [\xc2\xa7 3056],\nhowever, require the instant exercise o f judgm ent which should be protected.\xe2\x80\x9d).\n\n62\n\n\x0c(\xe2\x80\x9c [E]ffective government will be promoted if officials are freed from the\ncosts of vexatious and often frivolous damages suits.\xe2\x80\x9d). Thus, Treasury\xe2\x80\x99s\nindemnification plan would qualify as a necessary departmental expense,\nand would satisfy the prerequisites for an expenditure of funds from Treasury\xe2\x80\x99s\ngeneral appropriations. Treasury may use the funds in its general appropria\xc2\xad\ntions to indemnify all Department personnel for actions taken within the\ncourse and scope of their employment.\n\nIV.\nThere are three qualifications on this indemnification authority. First, in\norder to satisfy the requirements of the Anti-Deficiency Act, 31 U.S.C. \xc2\xa7\n1341(a)(1)(A), Treasury must be certain, before obligating itself to indem\xc2\xad\nnify a particular employee, that unexpended funds remain available in the\naccount which Treasury intends to use for the reimbursement.16 Second, not\nevery personal judgm ent rendered against an employee is reimbursable.\nWhere the incident which results in liability occurs during the performance\nof, but not as part of, an employee\xe2\x80\x99s official duties, the conduct falls outside\nthe scope of employment. The individual employee must bear any fines\nimposed or judgments rendered because of such conduct, and Treasury must\nassess each case individually to determine whether the resulting liability\nwas incident to the accomplishment of official Treasury business. 59 Comp.\nGen. 489, 493 (1980). See also 57 Comp. Gen. 270, 271 (1978) (traffic\nviolations); 31 Comp. Gen. 246, 247 (1952) (double parking to make a deliv\xc2\xad\nery is unauthorized conduct). Finally, although no annual or permanent\nstatutory limitations currently restrict Treasury\xe2\x80\x99s authority to indemnify em \xc2\xad\nployees, Treasury must regularly canvass new legislation to ensure that\nCongress has not enacted a limiting provision which might prevent Treasury\nfrom expending generally appropriated funds for indemnification.\n\nCONCLUSION\nThe Department of the Treasury has both specific and general authority to\nindemnify its officers and employees against personal liability imposed on\nthem for actions taken within the course and scope of their employment. 28\nU.S.C. \xc2\xa7 2006 and 26 U.S.C. \xc2\xa7 7423(2) provide specific indemnification\nauthority for employees involved in income tax collection and enforcement.\nFor all other employees, the Department may invoke its authority to expend\nfunds from its \xe2\x80\x9csalaries and expenses\xe2\x80\x9d appropriations to defray \xe2\x80\x9cnecessary\n\n16 The Anti-Deficiency Act prohibits employees o f the United States from authorizing an \xe2\x80\x9cexpendi\xc2\xad\nture o r obligation exceeding an amount available in an appropriation or fund for the expenditure or\nobligation.\xe2\x80\x9d 31 U.S.C. \xc2\xa7 1341(a)(1)(A).\n\n63\n\n\x0cexpenses\xe2\x80\x9d of the Department in the event that it concludes that such indemni\xc2\xad\nfication is necessary to prevent the threat of personal liability from interfering\nwith the effective performance of the Department\xe2\x80\x99s mission.\nJOHN O. MCGINNIS\nDeputy Assistant Attorney General\nOffice o f Legal Counsel\n\n64\n\n\x0c'


b"Executive Power with Regard to the Libyan Situation\n[The following memorandum reviews the significant statutory authorities available to the\nPresident and other executive officials in dealing with a foreign policy crisis.]\n\nDecember 23, 1981\nMEMORANDUM OPINION FOR T H E ATTORNEY GENERAL,\nT H E DEPUTY ATTORNEY GENERAL, AND THE ASSOCIATE\nATTORNEY G EN ERA L\nTo assist you in deliberations regarding Libya, we are providing a\ngeneral memorandum concerning statutes likely to be significant.\nA. The International Emergency Economic Powers Act\nThe President has wide-ranging power to regulate property and\ntransactions in which a foreign country has an interest under the Inter\xc2\xad\nnational Emergency Economic Powers Act (IEEPA), 50 U.S.C.\n\xc2\xa7\xc2\xa7 1701-1706 (Supp. Ill 1979), enacted in 1977. IEEPA was used\nduring the Iran hostage crisis: (1) to block Iranian government property\nin this country; (2) to limit exports and imports to Iran; (3) to restrict\ntransactions with any foreign person or entity relating to travel to Iran;\nand (4) to make the required transfers of funds in connection with the\nagreement ending the hostage crisis. Dames & Moore v. Reagan, 453\nU.S. 654 (1981); e.g., Exec. Order No. 12,170, 44 Fed. Reg. 65,729\n(1979); Exec. Order No. 12,205, 45 Fed. Reg. 24,099 (1980); Exec.\nOrder No. 12,211, 45 Fed. Reg. 26,685 (1980). It continues to be used\ntoday to implement various financial aspects of the settlement with\nIran.\nThe IEEPA provides broad powers to the President in the event of\nany:\nunusual and extraordinary threat, which has its source in\nwhole or substantial part outside the United States, to the\nnational security, foreign policy, or economy of the\nUnited States, if the President declares a national emer\xc2\xad\ngency with respect to such threat.\n50 U.S.C. \xc2\xa7 1701. If such an emergency is declared, the President may:\n432\n\n\x0cunder such regulations as he may prescribe, by means of\ninstructions, licenses, or otherwise\xe2\x80\x94\n(A) investigate, regulate, or prohibit\xe2\x80\x94\n(i) any transactions in foreign exchange,\n(ii) transfers of credit or payments between, by,\nthrough, or to any banking institution, to the extent that\nsuch transfers or payments involve any interest of any\nforeign country or a national thereof,\n(iii) the importing or exporting of currency or securities; and\n(B) investigate, regulate, direct and compel, nullify, void, pre\xc2\xad\nvent or prohibit, .any acquisition, holding, withholding, use,\ntransfer, withdrawal, transportation, importation or exportation\nof, or dealing in, or exercising any right, power, or privilege\nwith respect to, or transactions involving, any property in which\nany foreign country or a national thereof has any interest;\nby any person, or with respect to any property, subject to\nthe jurisdiction of the United States.\n50 U.S.C. \xc2\xa7 1702(a)(1).:Under these provisions, once the President\ndeclares a national emergency, he may control all foreign assets subject to\nthe jurisdiction of the United States, regulate or prohibit movements of\nforeign or domestic currency or credit in and out of the country, and\nprohibit all transactions involving any property in which the foreign\ncountry or any national thereof has an interest.\nIf a decision is made to invoke IEEPA, certain steps must be taken\nimmediately under that Act and the National Emergencies Act, 50\nU.S.C. \xc2\xa7\xc2\xa7 1601-1651. The latter Act confers no separate authority, but\nimposes procedural requirements.\n(1) Consultation with Congress: The President, \xe2\x80\x9cin every possible in\xc2\xad\nstance,\xe2\x80\x9d shall consult with Congress before exercising authorities under\nthe IEEPA. 50 U.S.C. \xc2\xa7 1703(a). There is no formal procedure for this.\nIt has usually been done with only a small group of congressional\nleaders.\n(2) Declaration o f a national emergency: A proclamation of national\nemergency is necessary to use the powers available under IEEPA. 50\nU.S.C. \xc2\xa7 1701. The President is authorized to declare an emergency\npursuant to the National Emergencies Act. 50 U.S.C. \xc2\xa7 1621. For pur\xc2\xad\nposes of IEEPA, such an emergency may be declared with respect to\nany unusual and extraordinary threat to the national security, foreign\npolicy, or economy of the United States which has its source outside\nthis country. 50 U.S.C. \xc2\xa7 1701. This language was left broad to provide\nnecessary discretion. H.R. Rep. No. 459, 95th Cong., 1st Sess. 10\n(1977).\n433\n\n\x0cA presidential declaration of emergency under IEEPA can be short\nand to the point. In the Iran crisis, the President stated: \xe2\x80\x9cI find that the\nsituation in Iran constitutes an unusual and extraordinary threat to the\nnational security, foreign policy and economy of the United States and\nhereby declare a national emergency to deal with that threat.\xe2\x80\x9d Exec.\nOrder No. 12,170, supra, 44 Fed. Reg. 65,729. The courts will not\nreview a determination so peculiarly within the province of the Presi\xc2\xad\ndent. See 42 Op. A tt\xe2\x80\x99y Gen. at 370.\nUnder the Act, Congress is authorized to terminate a declared emer\xc2\xad\ngency through adoption of a concurrent resolution. 50 U.S.C. \xc2\xa7 1706(b)\n(Supp. Ill 1979). It is our position that a concurrent resolution, because\nit would not be subject to the President\xe2\x80\x99s veto, would be constitution\xc2\xad\nally insufficient to terminate a declared emergency.\n(3) Designation o f Act: The National Emergencies Act declares that in\nthe same proclamation or by contemporaneous or subsequent executive\norders, the President must designate the particular emergency statute he\nwishes to invoke, e.g., IEEPA. The 1979 Iranian blocking order and\nemergency declaration appeared in the same document. Exec. Order\nNo. 12,170, supra, 44 Fed. Reg. 65,729.\n(4) Delegation: Since IEEPA vests powers directly in the President,\nan executive order should delegate power to an appropriate official. 3\nU.S.C. \xc2\xa7 301. This could be the Secretary of the Treasury, who already\nadministers similar programs. The President could declare a sanction in\ngeneral terms and delegate to an appropriate official the powers to\nadminister the sanction and enforce the Act. This was done with the\n1979 Iranian blocking order; doing so would avoid any enforcement\ngap between the issuance o f the proclamation and implementation of\nthe regulations by Treasury.\n(5) Publication and transmittal to Congress: The National Emergencies\nAct requires that the emergency proclamation be immediately transmit\xc2\xad\nted to Congress and published in the Federal Register. 50 U.S.C.\n\xc2\xa7 1621.\n(6) Report to Congress: Following the issuance of the order, the\nPresident shall \xe2\x80\x9cimmediately\xe2\x80\x9d transmit a report to the Congress specify\xc2\xad\ning:\n(1) the circumstances which necessitate such exercise of\nauthority;\n(2) why the President believes those circumstances con\xc2\xad\nstitute an unusual and extraordinary threat, which has its\nsource in whole or substantial part outside the United\nStates, to the national security, foreign policy, or econ\xc2\xad\nomy of the United States;\n(3) the authorities to be exercised and the actions to be\ntaken in the exercise of those authorities to deal with\nthose circumstances;\n434\n\n\x0c(4) why the President believes such actions are neces\xc2\xad\nsary to deal with those circumstances; and\n(5) any foreign countries with respect to which such\nactions are to be taken and why such actions are to be\ntaken with respect to those countries.\n50 U.S.C. \xc2\xa7 1703(b).\nThe legislative history indicates that this requirement was not to\nimpede use of emergency power. The House report notes:\nNothing in this section should be construed as requiring\nsubmission of a report as a precondition of taking action\nwhere circumstances require prompt action prior to or\nsimultaneously with submission of a report.\nH.R. Rep. No. 459, supra, at 16.\nThe Department of State is currently drafting appropriate report\nlanguage which, once approved by concerned agencies, can be incorpo\xc2\xad\nrated immediately into final documents.\nIEEPA provides for prison sentences of up to 10 years and fines up\nto $50,000. Officers, directors, and agents of corporations are specifi\xc2\xad\ncally covered by this provision if they knowingly participate in viola\xc2\xad\ntions. Civil fines of up to $10,000 may also be imposed.\nB. The Trading With the Enemy Act\nThe Trading with the Enemy Act, as amended in 1977, is available\nonly during a war. 50 U.S.C. App. \xc2\xa7 5(b) (Supp. Ill 1979). The key\nlanguage of IEEPA quoted above (describing the powers available to\nthe President) was based on the Trading with the Enemy Act, which\nretains comparable provisions. In addition, broader powers are available\nunder the Trading with the Enemy Act, including the authority to vest\nenemy property (a process by which the government seizes and takes\ntitle to it) and to control wholly domestic transactions. 50 U.S.C. App.\n\xc2\xa7 5(b).\nC. Passport Restrictions\nThe Passport Act, as amended in 1978, deals with the power of the\nSecretary of State to restrict the use of passports. It provides:\nUnless authorized by law, a passport may not be desig\xc2\xad\nnated as restricted for travel to or for use in any country\nother than a country with which the United States is at\nwar, where armed hostilities are in progress, or where\nthere is imminent danger to the public health or the physi\xc2\xad\ncal safety of United States travellers.\n22 U.S.C. \xc2\xa7 211a (Supp. Ill 1979).\n435\n\n\x0cThe amendment followed a Supreme Court decision holding that the\nPresident had authority to refuse to validate passports for travel to\nCuba. Zem el v. Rusk, 381 U.S. 1 (1965). The Senate committee that\nadded the amendment said that it intended to make \xe2\x80\x9cthe freedom-oftravel principle . . . a matter of law.\xe2\x80\x9d S. Rep. No. 842, 95th Cong., 2d\nSess. 14 (1978). Nevertheless, the Supreme Court has recently con\xc2\xad\nfirmed that the President has broad power over the issuance and revo\xc2\xad\ncation of passports. Haig v. Agee, 453 U.S. 280 (1981).\nThe President\xe2\x80\x99s power has been delegated to the Secretary of State\npursuant to Executive Order No. 11,295, 31 Fed. Reg. 10,603 (1966).\nOn December 9, 1981, Acting Secretary of State Clark restricted the\nuse of United States passports for travel in Libya by placing a notice to\nthat effect in the Federal Register. 46 Fed. Reg. 60,712 (1981). The\nnotice said that the action was required by the unsettled state of\nrelations with Libya, and the increased threat of hostile acts against\nAmericans. It noted that the American Embassy in Libya remains\nclosed and that the U.S. government is not in a position to provide\ndiplomatic protection or consular assistance to Americans in Libya.\nTherefore there was an imminent danger to the physical safety of\nAmericans travelling to or present in Libya.\nIn April, 1980, shortly before the rescue mission to Iran, President\nCarter authorized the restriction of the use of passports for travel to\nIran. Exec. Order No. 12,211, supra, 45 Fed. Reg. 26,685 (1980). This\nrestriction was lifted at the time of the hostage release agreement in\nJanuary, 1981. The order did not prove to be successful in deterring\nsome Americans from traveling to Iran. On May 31, 1980, while the\nhostages were being held and the travel restriction was in effect, former\nAttorney General Ramsey Clark led a group of ten U.S. citizens to Iran\nto participate in an international conference. The Attorney General\ndecided earlier this year not to litigate the question of whether this\ngroup had violated various federal laws.\nThe Passport Act itself provides no penalty for its violation. It is a\ncrime \xe2\x80\x9cto use any passport in violation of the conditions or restrictions\ntherein contained . . . . \xe2\x80\x9d 18 U.S.C. \xc2\xa7 1544. It is, however, difficult to\nenforce this law. It appears that, in order to have a successful prosecu\xc2\xad\ntion, the government must prove that a U.S. passport that was geo\xc2\xad\ngraphically restricted was used to enter the country to which travel\nwas restricted. Persons traveling to geographically restricted areas gen\xc2\xad\nerally work out arrangements with the country of destination to admit\nthem without presentation o f the passport; if the passport is not used,\nno violation occurs. Even if the passport is used, evidence on this point\nis not likely to be available to prosecutors in the United States. State\nDepartment regulations do not list violation of area restrictions as a\nbasis for revoking or denying a passport. 22 C.F.R. \xc2\xa7\xc2\xa7 51.70\xe2\x80\x94.71 (1981).\nIt appears that the regulations could be amended so that violation of an\n436\n\n\x0carea restriction would be a ground for revocation. The problems of\nproof described for the criminal law would, however, apply here as\nwell.\nD. Export Administration Act\nThe Export Administration Act of 1979, 50 U.S.C. App. \xc2\xa7\xc2\xa724012413 (Supp. Ill 1979), contains three separate grants of power to the\nPresident to prohibit or curtail the export of goods and technology\nsubject to the jurisdiction of the United States: national security con\xc2\xad\ntrols, foreign policy controls, and short supply controls. 50 U.S.C. App.\n\xc2\xa7\xc2\xa7 2404, 2405, 2406.\nThe provision likely to be most pertinent relates to foreign policy\ncontrols.1 On October 23, 1981, foreign policy controls were imposed\non exports of aircraft and aircraft parts to Libya. 46 Fed. Reg. 53,023\n(1981) (to be codified at 15 C.F.R. \xc2\xa7\xc2\xa7 376, 385, 399). Previously, offhighway tractors were restricted for sale to Libya under this section. 15\nC.F.R. \xc2\xa7 385.4(e) (1981).\nThis Act was not employed against Iran, but was recently used to\nrestrict exports to the Soviet Union in 1980 following the invasion of\nAfghanistan. 45 Fed. Reg. 1883 (1980) (to be codified at 15 C.F.R.\n\xc2\xa7\xc2\xa7 376, 386, 399) (Restriction on the Export of Agricultural Commod\xc2\xad\nities and Products to the U.S.S.R.); 45 Fed. Reg. 21,612 (1980) (to be\ncodified at 15 C.F.R. \xc2\xa7\xc2\xa7 371, 379, 385, 399) (Controls on Goods and\nTechnology for Moscow Olympics).\nThe President may prohibit exports \xe2\x80\x9cto the extent necessary to fur\xc2\xad\nther significantly the foreign policy of the United States or to fulfill its\ndeclared international obligations.\xe2\x80\x9d 50 U.S.C. App. \xc2\xa7 2405(a)(1). One of\nthe expressly permitted purposes of foreign policy controls is discourag\xc2\xad\ning the provision of aid or sanctuary to international terrorists. 50\nU.S.C. App. \xc2\xa7 2402(8).\nThe President\xe2\x80\x99s authority to impose foreign policy controls has been\ndelegated to the Secretary of Commerce. Exec. Order No. 12,214, 45\nFed. Reg. 29,783 (1980). It must be exercised, however, in consultation\nwith the Secretary of State. 50 U.S.C. App. \xc2\xa7 2405(a) (Supp. Ill 1979).\n1 National security controls may be imposed in order to restrict the export of goods and technology\nwhich would make \xe2\x80\x9ca significant contribution to the military potential o f any other country,\xe2\x80\x9d which\nwould prove detrimental to the United States, 50 U.S.C. App. \xc2\xa7 2402(2)(B), and which pertain to\n\xe2\x80\x9cmilitarily critical goods and technologies,\xe2\x80\x9d 50 U.S.C. App. \xc2\xa7 2404(d)(1). The Secretary cannot require\na validated license unless (A) the export is restricted under a multilateral agreement; (B) with respect\nto the export, other nations do not possess capabilities comparable to those of the United States; or (C)\nthe United States is seeking agreement of other suppliers to apply comparable controls 50 U.S.C.\nApp. \xc2\xa7 2404(e)(2). If the President determines that goods or technology are available from foreign\nsources so that a specific licensing requirement would be ineffective, he may still impose controls if he\nfinds that \xe2\x80\x9cthe absence o f export controls\n. would prove detrimental to the national security of the\nUnited States \xe2\x80\x9d 50 U.S.C. App. \xc2\xa7 2404(f)(1).\nShort supply controls are used \xe2\x80\x9c to restrict the export of goods where necessary to protect the\ndomestic economy from the excessive drain of scarce materials and to reduce the senous inflationary\nimpact of foreign demand \xe2\x80\x9d 50 U.S.C. App. \xc2\xa7 2402(2)(C)\n\n437\n\n\x0cCertain criteria must be considered when imposing or expanding such\ncontrols. They include:\n(1) The probability that they will achieve their purpose;\n(2) Compatibility with foreign policy including the\neffort to counter terrorism;\n(3) The reaction o f other countries;\n(4) The impact on the ability of the United States to\ncompete economically including the effect on existing\ncontracts;\n(5) Ability to enforce the controls effectively; and\n(6) The foreign policy consequences of not imposing\ncontrols.\n50 U.S.C. App. \xc2\xa7 2405(b).\nThe Secretary of Commerce must, in addition, take the following\nsteps:\n(a) Consult with afTected industries concerning items (1)\nand (4), supra;\n(b) Determine that reasonable efforts have been made\nto achieve the purposes of the controls through negotia\xc2\xad\ntions or other alternative means;\n(c) Consult \xe2\x80\x9cin every possible instance\xe2\x80\x9d with the Con\xc2\xad\ngress;\n(d) Notify Congress of the action taken; and\n(e) Submit a report on items (1) through (6), supra, and\non alternative means attempted or the reason for imposing\nthe control without attempting alternative means. The\nreport must also indicate how such controls will signifi\xc2\xad\ncantly further the foreign policy of the United States or\nwill further its international obligations.\n(0 Take all feasible steps to initiate and conclude nego\xc2\xad\ntiations with appropriate foreign governments to control\nexports by them of comparable goods or technology.\n50 U.S.C. App. \xc2\xa7 2405(c), (d), (e).\nCriminal violators of restrictions issued for foreign policy purposes\ncan be punished by a fine of five times the value of the export or\n$100,000, whichever is greater, and imprisoned for up to 10 years.\nOfficers of corporations are not specifically covered by the penalty\nprovision but under general principles of law can be prosecuted as\nviolators. 18 U.S.C. \xc2\xa72. Wood v. United States, 204 Fed. 55 (4th Cir.\n1913), cert, denied, 229 U.S. 617. In addition, civil fines of up to $10,000\nmay be imposed by the Commerce Department. Administrative sanc\xc2\xad\ntions are also available including revocation of the authority to export\ngoods or technology. 50 U.S.C. App. \xc2\xa7 2410(b), (c).\n438\n\n\x0cE. The War Powers Resolution\n\nThe War Powers Resolution, 50 U.S.C. \xc2\xa7\xc2\xa7 1541-1548, deals with the\nprocedures which must be followed in the use of our armed forces. It\n\nincludes requirements to consult with and report to Congress.\n1.\nConsultation. The consultation requirement focuses on use of\ntroops in hostile situations:\nThe President in every possible instance shall consult\nwith Congress before introducing United States Armed\nForces into hostilities or into situations where imminent\ninvolvement in hostilities is clearly indicated by the cir\xc2\xad\ncumstances, and after every such introduction shall con\xc2\xad\nsult regularly with the Congress until United States*\nArmed Forces are no longer engaged in hostilities or have\nbeen removed from such situations.\n50 U.S.C. \xc2\xa7 1542.\nOn its face, consultation is required with \xe2\x80\x9cCongress.\xe2\x80\x9d This language\nreplaced an earlier version which merely required consultation with the\nleadership and appropriate committees of Congress. H.R. Conf. Rep.\nNo. 547, 93rd Cong., 1st Sess. 8 (1973); H.R. Rep. No. 287, 93rd Cong.,\n1st Sess. 6 (1973). Nevertheless, as a practical matter consultation with\nany more than a select group of congressional leaders has never been\nattempted.\nIn requiring consultation in \xe2\x80\x9cevery possible instance,\xe2\x80\x9d Congress\nmeant to be firm yet flexible. H.R. Rep. No. 287, supra, at 6. The\nHouse report noted:\nThe use of the word \xe2\x80\x9cevery\xe2\x80\x9d reflects the committee\xe2\x80\x99s\nbelief that such consultation prior to the commitment of\narmed forces should be inclusive. In other words, it\nshould apply in extraordinary and emergency circum\xc2\xad\nstances\xe2\x80\x94even when it is not possible to get formal con\xc2\xad\ngressional approval in the form of a declaration of war or\nother specific authorization.\nAt the same time, through use of the word \xe2\x80\x9cpossible\xe2\x80\x9d it\nrecognizes that a situation may be so dire, e.g\xe2\x80\x9e hostile\nmissile attack underway, and require such instantaneous\naction that no prior consultation will be possible.\nId.\n\nPresident Carter determined that consultation was not \xe2\x80\x9cpossible\xe2\x80\x9d\nprior to the Iran rescue mission because of the great need for secrecy.\nHe indicated, however, that if the mission had not been aborted in its\n\n439\n\n\x0cfirst phase, he planned to advise appropriate congressional leaders\nbefore the next phase, the actual rescue, took place.2\nConsultation is only required prior to the actual \xe2\x80\x9cintroduction\xe2\x80\x9d of\nforces into hostilities. Thus, it is not required during planning or prepa\xc2\xad\nration stages as long as forces have not been committed.\nA determination must also be made as to when hostilities exist that\nrequire consultation. President Ford took the position, for example, that\nno consultation was legally required at the Danang or Lebanon evacu\xc2\xad\nations because hostilities were not involved. Franck, After the Fall: The\nN ew Procedural Framework fo r Congressional Control Over the War\nPower, 71 Am. I. Int\xe2\x80\x99l L. 605, 615 (1977). The State and Defense\n\nDepartments have said that \xe2\x80\x9chostilities\xe2\x80\x9d mean a situation in which\nAmerican forces are actively exchanging fire with opposing units and\n\xe2\x80\x9cimminent hostilities\xe2\x80\x9d mean a situation where there is a serious risk\nfrom hostile fire to the safety of U.S. forces. Neither term was thought\nto encompass irregular or infrequent violence which may occur in a\nparticular area. War Powers: A Test o f Compliance, Relative to the\nDanang Sealift, the Evacuation o f Phnom Penh, the Evacuation o f Saigon,\nand the Mayaguez Incident, Hearings Before the Subcomm. on Int'l Secu\xc2\xad\nrity and Scientific Affairs o f the House Comm, on Int'l Relations, 94th\n\nCong., 1st Sess. 38-39, 85-86 (1975).\n2. Reporting requirements. The reporting requirements apply to situa\xc2\xad\ntions not only where hostilities are taking place or imminent (which\nrequires consultation) but where armed forces are sent to a foreign\ncountry equipped for combat. 50 U.S.C. \xc2\xa7 1543. The report must be\nfiled within 48 hours. This has been interpreted as meaning 48 hours\nfrom the time that they are \xe2\x80\x9cintroduced\xe2\x80\x9d into the situation triggering\nthe requirement and not from the time that the decision to dispatch\nthem is made. E.g., Franck, supra, at 615. The report must include:\n(1) The circumstances necessitating the introduction of\nUnited States Armed Forces;\n(2) The constitutional or legislative authority under\nwhich such introduction took place; and\n(3) The estimated scope and duration of the hostilities\nor involvement.\nFranck, supra, at 614-15.\nReports filed in the past have been brief and to the point; they have not\nrun more than one or two pages. The discussion of legal authority in the\nreports has been limited to a brief reference to the constitutional power of\nthe President as Commander-in-Chief and Chief Executive. This Admin\xc2\xad\n2 Statement o f A cting Secretary o f State Christopher, May 8, 1980, to Senate Foreign Relations\nComm., p. 5. A lthough the Acting Secretary\xe2\x80\x99s statement was phrased in statutory terms, the consulta\xc2\xad\ntion requirement raises a constitutional question as to a possible limit on the President\xe2\x80\x99s independent\npower. Testimony o f State Department Legal Adviser M onroe Leigh in War Powers: A Test o f\nCompliance, supra, at 100\n\n440\n\n\x0cistration took the position that the incident earlier this year where two\nLibyan planes were shot down over the Mediterranean did not implicate\neither the consultation or reporting provisions.\nThe resolution includes in its statement of purpose and policy a list of\nsituations in which the President is authorized to introduce the Armed\nForces into hostilities or situations of imminent hostility. This may be\ndone: (1) pursuant to a declaration of war; (2) under specific statutory\nauthorization, or (3) in a national emergency created by an attack upon\nthe United States, its territories or possesions or its armed forces. 50\nU.S.C. \xc2\xa7 1541(c). We do not believe, however, that the purpose and\npolicy statement should be construed to constrain the exercise of the\nPresident\xe2\x80\x99s constitutional power. The Resolution\xe2\x80\x99s policy statement is\nnot a comprehensive or binding formulation of the President\xe2\x80\x99s powers\nas Commander-in-Chief. See H.R. Conf. Rep. 547, 93rd Cong., 1st Sess.\n8 (1973) (stating that subsequent sections of the Resolution are not\ndependent on the policy statement). The Resolution itself disclaims any\nintent to alter the constitutional power of the President. 50 U.S.C.\n\xc2\xa7 1547(d)(1).\nFinally, the Resolution provides that Congress may, by concurrent\nresolution, force the withdrawal of our armed forces from abroad. 50\nU.S.C. \xc2\xa7 1544(c). This \xe2\x80\x9clegislative Veto\xe2\x80\x9d device is, in our view, uncon\xc2\xad\nstitutional. See Veto of the War Powers Resolution, 1973 Pub. Papers\nof Richard Nixon 893 (Oct. 24, 1973).\nF. Powers Relating to Libyan Nationals\nThe Immigration and Nationality Act, 8 U.S.C. \xc2\xa7\xc2\xa7 1101-1525 (1976\ned. and Supp. Ill 1979), provides the Executive with broad powers to\nrestrict the entry of aliens into the United States and to deport them.\nThe President may issue regulations governing the entry and depar\xc2\xad\nture of aliens from the United States. It is unlawful\nfor any alien to depart from or enter or attempt to depart\nfrom or enter the United States except under such reason\xc2\xad\nable rules, regulations, and orders, and subject to such\nlimitations and exceptions as the President may pre\xc2\xad\nscribe . . . .\n8 U.S.C. \xc2\xa7 1185(a)(Supp. Ill 1979). In addition, the President may\nsuspend the entry of aliens by designated classes:\nWhenever the President finds that the entry of any\naliens or of any class of aliens into the United States\nwould be detrimental to the interests of the United States,\nhe may by proclamation, and for such period as he shall\ndeem necessary, suspend the entry of all aliens or any\nclass of aliens as immigrant or nonimmigrants, or impose\n441\n\n\x0con the entry of aliens any restrictions he may deem to be\nappropriate.\n8 U.S.C. \xc2\xa7 1182(0In the Iran crisis, the President delegated to the Secretary of State\nand the Attorney General the powers of the President under 8 U.S.C.\n\xc2\xa7 1185 to prescribe limitations respecting visas issued to Iranians. Exec.\nOrder No. 12,172, 44 Fed. Reg. 67,947 (1979), as amended by Exec.\nOrder No. 12,206, 45 Fed. Reg. 24,101 (1980). Under this order, the\nState Department issued regulations requiring all outstanding visas of\nIranian nationals to be re-endorsed and for new visas to be issued only\nunder strict standards. 22 C.F.R. \xc2\xa746.8 (1981). Sections 1182 and 1185\nwere the authority for Proclamation 4865, 46 Fed. Reg. 48,107 (1981),\nand Executive Order No. 12,324, 46 Fed. Reg. 48,109 (1981) concern\xc2\xad\ning interdiction of aliens on the high seas.\nIn addition, the Attorney General can issue regulations to carry out\nthe immigration laws, 8 U.S.C. \xc2\xa7 1103(a), and is charged with insuring\nthat aliens who have not maintained their status under the law depart\nfrom the United States, 8 U.S.C. \xc2\xa7 1184(a). These powers are delegated\nto the Commissioner of Immigration and Naturalization. 28 C.F.R.\n\xc2\xa70.105 (1981). In 1979 the Immigration and Naturalization Service\n(INS) issued regulations requiring Iranian students to report to the INS\nand submit evidence that they had maintained eligibility as students\nunder the immigration laws. 8 C.F.R. \xc2\xa7214.5 (1981). Subsequently, the\nINS provided for the accelerated departure of all Iranians who were\njudged deportable by limiting the amount of time permitted for depar\xc2\xad\nture. 8 C.F.R. \xc2\xa7242.5 (1981). These INS regulations were upheld in\nsubsequent litigation as a valid exercise of the Attorney General\xe2\x80\x99s\nstatutory power. The courts held that the regulations had a rational\nbasis and did not therefore deprive Iranians of equal protection of the\nlaws. Narenji v. Civiletti, 617 F.2d 745 (D.C. Cir. 1979), cert, denied, 446\nU.S. 957 (1980); Malek-Marzban v. INS, 653 F.2d 113 (4th Cir. 1981);\ncf. Yassini v. Crosland, 618 F.2d 1356 (9th Cir. 1980).\nApart from the statute below dealing with enemy aliens, there is no\nlaw which specifically provides the power to expel aliens who are in\nthis country lawfully as permanent residents or nonimmigrants and who\nare not otherwise subject to deportation.\nThe President has statutory authority to intern or expel enemy aliens.\nThis power is available, however, only in time of war, invasion, or\npredatory incursion. 50 U.S.C. \xc2\xa721. The Supreme Court has held this\nprovision constitutional. Ludecke v. Watkins, 335 U.S. 160 (1948).\nFor your information, we are attaching: (1) examples of orders which\nhave been issued in the past; and (2) a listing of major opinions,\nincluding subject headings issued by this Office during the Iranian\n442\n\n\x0ccrisis. The latter attachment demonstrates the broad range of actions\nwhich were considered during that crisis.\nT heodore\n\nB. O l s o n\n\nAssistant Attorney General\nOffice o f Legal Counsel\n\n443\n\n\x0c"


b'Constitutionality of the Disclosure Provisions of the\nEthics in Government Act as Applied to Officials\xe2\x80\x99 Spouses\nW hatever test is applied to test their constitutionally, the provisions o f the E thics in\nG overnm ent A ct that require certain high-level officials to disclose information con\xc2\xad\ncerning their spouses\' financial interests do not invade any constitutionally protected\nprivacy right.\nT he financial disclosure provisions at issue are narrow ly draw n to prom ote Congress\'\ninterest in using disclosure to enforce substantive prohibitions vis-a-vis high-level offi\xc2\xad\ncials.\n\nJanuary 9, 1980\nM EM ORANDUM OPINION FOR T H E CHAIRM AN O F THE\nFE D E R A L T R A D E COMMISSION\nYou have asked for our advice about the refusal by a former official\nof the Federal Trade Commission (FTC) to disclose information con\xc2\xad\ncerning his wife\xe2\x80\x99s financial interests, information he is required to dis\xc2\xad\nclose by Title II of the Ethics in Government Act, Pub. L. No. 95-521,\n92 Stat. 1836 (1978), as amended, 5 U.S.C. App. I. The official filed the\nstatement required by the Act but omitted this information. He said that\nhe was willing to disclose it confidentially, but he argued that the\nprovisions of the Ethics in Government Act, which effectively compel\npublic disclosure of the information, violated his and his wife\xe2\x80\x99s constitu\xc2\xad\ntional rights. For the reasons set forth below, we believe that the\nchallenged provisions are constitutional.1 We suggest that you inform\nthe official of this conclusion and of any conclusion reached by the\nOffice of Government Ethics, to which you also referred the matter,\nand allow him to decide, in light of this information, whether he wishes\nto complete his report. In this connection, you may give him a copy of\nthis memorandum.\nTitle II of the Ethics in Government Act requires high-level Execu\xc2\xad\ntive Branch officials, see \xc2\xa7 201(0, to file reports disclosing a number of\ndetails about their income, assets, and liabilities, about gifts and\nreimbursements they have received, about certain sales or exchanges of\n1\nO rdinarily, this Office w ould not seriously consider concluding that an A ct o f Congress was\nunconstitutional. See. e.g.. 40 Op. Att*y G en. 158, 160-61 (1942); 39 Op. A tt\xe2\x80\x99y G en. 11, 16 (1937); 31\nOp. A tt\xe2\x80\x99y G en. 475, 476 (1919). In this case, how ever, w e are confident that the challenged provisions\nw ould be upheld by a court, and we have set forth o u r reasons for believing these provisions to be\nconstitutional so that the official might know that his argum ents have been fully considered.\n\n340\n\n\x0creal property and securities, and about some other financial affairs and\narrangements. See \xc2\xa7 202(a)-(d). With some exceptions and modifications\nthey must disclose comparable information about their spouses and\ndependent children. See \xc2\xa7 202(e). These reports are to be made public.\nSee \xc2\xa7 205. The official involved here contends that the government\ncannot constitutionally require him to disclose to the public financial\ninformation about his wife that is not already a matter of public record.\nHe makes a number of arguments in a legal memorandum he filed with\nyour agency in support of his position.\nHis most substantial argument is that the Act violates his wife\xe2\x80\x99s\nconstitutional right to privacy. The Supreme Court has said that the\nright of privacy comprises an \xe2\x80\x9cindividual interest in avoiding disclosure\nof personal matters.\xe2\x80\x9d Whalen v. Roe, 429 U.S. 589, 599 (1977). The\nCourt has never invalidated a statute solely because it infringed this\nkind of \xe2\x80\x9cprivacy\xe2\x80\x9d interest. Compare id. at 599 n.25 with id. at 607-09\n(Stewart, J., concurring). But on at least two occasions the Court\nseriously considered claims that government action unconstitutionally\ninvaded this interest; in both cases it rejected the claims only after\nconcluding that the \xe2\x80\x9cpersonal matters\xe2\x80\x9d involved would be disclosed not\nto the public at large but only to a small group of selected officials who\nwere unlikely to publicize it. See, id. at 605-06; Nixon v. Administrator\no f General Services, 433 U.S. 425, 458-59, 462, 464-65 (1977). Neither of\nthese cases involved financial information,2 but as two Justices have\nsaid, \xe2\x80\x9c[financial transactions can reveal much about a person\xe2\x80\x99s activi\xc2\xad\nties, associations, and beliefs. At some point, governmental intrusion\nupon these areas would implicate legitimate expectations of privacy.\xe2\x80\x9d\nCalifornia Bankers Association v. Shultz, 416 U.S. 21, 78-79 (1974)\n(Powell and Blackmun, JJ., concurring). See also Buckley v. Valeo, 424\nU.S. 1, 66 (1976). But see O\'Brien v. DiGrazia, 544 F.2d 543, 545-46 (1st\nCir. 1976), cert, denied, 431 U.S. 914 (1977). The Fifth Circuit has\nupheld the judicial branch disclosure provisions of the Ethics in G ov\xc2\xad\nernment Act, Duplantier v. United States, 606 F.2d 654, 669-71 (1979),\nas well as a state statute similar to the Act, Plante v. Gonzalez, 575 F.2d\n1119 (1978), but nevertheless said that public officials\xe2\x80\x99 \xe2\x80\x9cinterests in\nfinancial privacy\xe2\x80\x9d were \xe2\x80\x9csubstantial.\xe2\x80\x9d Id. at 1135. \xe2\x80\x9cFinancial privacy is\na matter of serious concern, deserving strong protection.\xe2\x80\x9d Id. at 1136.3\nSee also Slevin v. City o f New York, A ll F. Supp. 1051 (S.D.N.Y. 1979).\n2 In Whalen v. Roe, 429 U.S. 589, 599 (1977), patients and d octors challenged N ew Y ork\'s practice\no f keeping centralized co m p u ter records o f prescriptions for dangerous but legal drugs. N ixon v.\nAdministrator o f Genera! Services, 433 U.S. 425 (1977), involved the personal com m unications and\ndiaries o f form er President Nixon; they w ere com m ingled w ith a m uch larger volum e o f public papers\nthat governm ent archivists w ere to screen.\n3 T he official also suggests that the A ct interferes w ith his wife\'s First A m endm ent freedom s\nbecause her financial interests may. reveal her political beliefs, and associations. T h e Suprem e C ourt\nhas, indeed, frequently held that forcing the disclosure o f information about certain First A m endm ent\nactivities can deter people from engaging in them. See, e.g.. Gibson v. Florida Legislative Comm., 372\nU.S. 539 (1963): N A A C P v. Button, 371 U.S. 415 (1963); Shelton v. Tucker, 364 U.S. 479 (1960); Bates\n\n341\n\n\x0cFor these reasons, some state courts have held that statutes requiring\nfinancial disclosure are unconstitutional unless they are necessary to\npromote a compelling governmental interest. See, e.g., City o f Carmelby-the-Sea v. Young, 2 Cal.3d 259, 268, 466 P.2d 225, 231-32, 85 Cal.\nRptr. 1, 7-8 (1970). No Federal court has gone this far. See Nixon v.\nAdministrator o f General Services, 433 U.S. at 455-65; Duplantier v.\nUnited States, supra, 606 F.2d at 670 (appropriate test is \xe2\x80\x9cbalancing\xe2\x80\x9d not\n\xe2\x80\x9cstrict scrutiny\xe2\x80\x9d); Plante v. Gonzalez, 575 F.2d 1119, 1134 (5th Cir.\n1978) (same). Compare Whalen v. Roe, 429 U.S. 589, 606-07 (1977)\n(Brennan, J., concurring) with id. at 607-09 (Stewart, J., concurring).\nWe need not express a view about the strength or contours of whatever\nconstitutional rights exist in this area, however, because we believe that\nthe Ethics in Government Act does meet the strictest plausible test; it is\na necessary means, well-tailored to attain compelling governmental\naims. A fortiori it would meet any less restrictive standard.\nCongress was explicit about its objectives in requiring officials to\ndisclose financial information to the public. Public disclosure promotes\npublic confidence in tl.~ government, see S. Rep. No. 170, 95th Cong.,\n1st Sess. 21 (1977); no intragovernmental audit can be quite as success\xc2\xad\nful in dispelling suspicion. Public disclosure can help correct deficien\xc2\xad\ncies in the government\xe2\x80\x99s own auditing and reviewing procedures. See S.\nRep. No. 823, 94th Cong., 2d Sess. 22 (1976). \xe2\x80\x9cWide public availability\nof the financial disclosure reports\xe2\x80\x9d tends to \xe2\x80\x9cassure compliance with\n[the] disclosure requirements\xe2\x80\x9d themselves. H.R. Rep. No. 574, 95th\nCong., 1st Sess. 11 (1977). In general, public financial disclosure makes\nofficials\xe2\x80\x99 possible conflicts of interest a subject for debate and action by\nthe public. As a result,\n[p]ublic financial disclosure will deter some persons\nwho should not be entering public service from doing so.\nIndividuals whose personal finances would not bear up to\nV . Lillie Rock. 361 U.S. 516 (I960); N A A C P v. Alabama. 357 U.S. 449 (1958). A nd it has recognized\nlhal, on occasion, financial inform ation can reveal significant facts about activities protected by the\nFirst A m endm ent. See Buckley v. Valeo. 424 U.S. I, 66 (1976), quoting California Bankers Association v.\nShultz. 416 U.S. 21, 78-79 (1974) (Pow ell and Blackm un, JJ., co n curring). But for several reasons the\nargum ent is inapposite here. First, the A ct was drafted to avoid such an invasion o f First A m endm ent\nrights so far as possible. Section 202(a)(6KA), for exam ple, requires an official to report positions held\nin outside organizations; but it does not apply to mem bers o f th e official\'s family, and it specifically\nprovides that the official need not report "positions held in any religious, social, fraternal, or political\nentity and positions solely o f an h onorary n atu re." This suggests that C ongress carefully considered\nFirst A m endm ent interests w hen it drafted the A ct. C f, American Fed\'n o f Gov\'t Employees, Local 421\nv. Schlesinger, 443 F. Supp. 431, 434 (D .D .C . 1978) (financial disclosure questionnaire for governm ent\nofficials unconstitutional because it "p ry s into religious, social, political, educational, and fraternal\nassociations both o f the em ployee, the em ployee\'s spouse, his m inor children and dependents").\nSecond, even w hen a statute requires an individual to disclose m aterial that d irectly reflects his\npolitical view s, the Suprem e C ourt has required him to show \xe2\x80\x9c a reasonable probability that the\ncom pelled disclosure . . . will subject [him] to threats, harassm ent, o r reprisals." Buckley v. Valeo, 424\nU.S. 1, 74 (1976). T he official here has made no such show ing. Finally, even if there w ere a danger\nthat the disclosure provisions w ould interfere w ith First A m endm ent rights, they are\xe2\x80\x94as w e shall\ndiscuss sh o rtly \xe2\x80\x94 necessary to prom ote \xe2\x80\x9cgovernm ental interests sufficiently im portant to outw eigh the\npossibility o f infringem ent.\xe2\x80\x9d Id. at 66.\n\n342\n\n\x0cpublic scrutiny, whether due to questionable sources of\nincome or a lack of morality in business practices, will\nvery likely be discouraged from entering public office\naltogether. . . .\nPublic financial disclosure will [also] better enable the\npublic to judge the performance of public officials. By\nhaving access to financial disclosure statements, an inter\xc2\xad\nested citizen can evaluate the official\xe2\x80\x99s performance of his\npublic duties in light of the ofTicial\xe2\x80\x99s outside financial\ninterests.\nS. Rep. No. 170, 95th Cong., 1st Sess. 21-22 (1977). See also H.R. Rep.\nNo. 574, 95th Cong., 1st Sess. 7-12. \xe2\x80\x9c[IJnformed public opinion is the\nmost potent of all restraints upon misgovernment.\xe2\x80\x9d Grosjean v. Ameri\xc2\xad\ncan Press Co., 297 U.S. 233, 250 (1936).\nThe Supreme Court has said that because these sorts o f goals involve\nthe \xe2\x80\x9c \xe2\x80\x98free functioning of our national institutions,\xe2\x80\x99 \xe2\x80\x9d they can justify a\ndecision by Congress to impose \xe2\x80\x9cnot insignificant burdens on individual\nrights.\xe2\x80\x9d Buckley v. Valeo, 424 U.S. 1, 66-67, 68, 72-74 (1976), quoting\nCommunist Party v. Subversive Activities Control Board, 367 U.S. 1, 97\n(1961). And the Supreme Court has allowed Congress to require disclo\xc2\xad\nsure in order \xe2\x80\x9cto maintain the integrity of a basic governmental proc\xc2\xad\ness\xe2\x80\x9d even if the disclosure may have \xe2\x80\x9csome deterrent effect\xe2\x80\x9d on the\nexercise of constitutional rights. United States v. Harriss, 347 U.S. 612,\n625-26 (1954). Certain public employees can be required to sacrifice\nimportant rights\xe2\x80\x94even well-established First Amendment rights that\ncan only be stronger than the rather nebulous privacy interests in\xc2\xad\nvolved here\xe2\x80\x94in order to ensure that \xe2\x80\x9cconfidence in the system of\nrepresentative Government is not . . . eroded to a disastrous extent,\xe2\x80\x9d\nUnited States Civil Service Commission v. National Association o f Letter\nCarriers, 413 U.S. 548, 565 (1973), and that \xe2\x80\x9cpolicies which the elector\xc2\xad\nate has sanctioned are effectively implemented,\xe2\x80\x9d Elrod v. Burns, 427\nU.S. 347, 372 (1976) (plurality opinion).\nDisclosure does not merely enhance public confidence in the govern\xc2\xad\nment; it also improves the quality of public debate about such matters\nof general concern as possible conflicts in officials\xe2\x80\x99 loyalties. It ex\xc2\xad\npresses our \xe2\x80\x9cprofound national commitment to the principle that debate\non public issues should be uninhibited, robust, and wide-open.\xe2\x80\x9d New\nYork Times v. Sullivan, 376 U.S. 254, 270 (1964). To promote these\nends, the Supreme Court has said that officials \xe2\x80\x9cwho have, or appear to\nthe public to have, substantial responsibility for or control over the\nconduct of governmental affairs,\xe2\x80\x9d Rosenblatt v. Baer, 383 U.S. 75, 85\n(1966), cannot constitutionally be protected against certain efforts to\ndamage their reputations, even if the legislature wants to protect them.\nSee, e.g., New York Times v. Sullivan, 376 U.S. 254 (1964). The interest\nin reputation, of course, is akin to the sort of privacy the official here\n343\n\n\x0cclaims is invaded by the Ethics in Government Act. In these various\nways, then, requiring officials to disclose financial information plainly\npromotes compelling governmental ends.\nCongress reasoned that its efforts to pursue these ends could be easily\ndefeated if it did not also require officials\xe2\x80\x99 spouses to disclose certain\ninformation.4 \xe2\x80\x9c[Resources of a husband and a wife are usually held in\ncommon, and the financial interests of a spouse are generally shared by\nthe partner. A bookkeeping arrangement wherein one spouse holds sole\ntitle to a particular financial asset does not mean that the partner does\nnot share an interest in the financial holding.\xe2\x80\x9d H.R. Rep. No. 574, 95th\nCorig., 1st Sess. 23 (1977). Congress also noted that, unless officials are\nrequired to disclose financial information about their spouses, they can\neasily evade both substantive and disclosure requirements by transfer\xc2\xad\nring interests. See id. at 22. Even officials who do not gain directly\nfrom their spouses\xe2\x80\x99 interests may simply wish to see their spouses gain.\nId. at 22, 40. Those who want to influence an official may attempt to\ndo so by benefitting the official\xe2\x80\x99s spouse. Moreover, even if these\nvarious evasions never occur, the danger that they will occur\xe2\x80\x94and the\npublic knowledge that an obvious loophole exists that might permit\nthem to occur\xe2\x80\x94would undermine a principal objective of the Ethics in\nGovernment Act, restoring public confidence in the integrity of the\ngovernment.\nFinally, requiring officials to disclose their spouses\xe2\x80\x99 financial interests\nis an important means of enforcing substantive conflict of interest laws.\nFor example, in general an Executive Branch employee may not par\xc2\xad\nticipate\n. . . personally and substantially as a Government officer\nor employee . . . in a judicial or other proceeding . . . or\nother particular matter in which, to his knowledge, he, his\nspouse, [or] minor child . . . has a financial interest.\n18 U.S.C. \xc2\xa7 208(a). Plainly, the public availability of financial informa\xc2\xad\ntion about an official\'s spouse helps enforce this conflict of interest\nprovision, and the Supreme Court has recognized that Congress has a\nstrong interest in using disclosure\xe2\x80\x94not merely recordkeeping and re\xc2\xad\nporting\xe2\x80\x94to enforce substantive prohibitions. See, e.g., Buckley v. Valeo,\n4\nIn fact, the spouse need not disclose anything; the official must disclose information about his or\nher spouse. T h e H ouse Com m ittee\nconsidered, and rejected as irrelevant, argum ents that the governm ent may have\ndifficulty in bringing a civil o r crim inal action against an individual w ho . . . filed an\nincom plete statem ent, because the spouse may have refused to provide the necessary\ninform ation. This concern is m ore appropriately raised as a defense w hen the reporting\nperson, despite a good-faith effort, is unable to com ply w ith the reporting provisions of\nthe law. T he com m ittee believes that such good-faith tests may be useful in review ing\nspecific cases o f noncom pliance, but that such situations should not be view ed as\nim pedim ents to the passage o f (his bill.\nH .R. Rep. No. 574. 95th C ong., 1st Sess. 24 (1977).\n\n344\n\n\x0c424 U.S. 1, 67-68 (1976). See also Duplantier v. United States, supra, 606\nF.2d at 670-73.\nBoth the Act itself and its legislative history reveal that the disclo\xc2\xad\nsure provisions were narrowly drawn to promote these compelling\nends. In connection with the disclosure provisions for all three\nbranches, Congress considered the specific advantages of requiring\npublic disclosure instead of permitting reports to be filed confidentially\nwith government reviewing bodies. See, e.g., H.R. Rep. No. 574, 95th\nCong., 1st Sess. 7-12 (1977); H.R. Rep. No. 642, 95th Cong., 1st Sess.\n27-29 (1977). Congress also \xe2\x80\x9crecognize[d] that reporting of financial\ninterests of family members is a very sensitive matter.\xe2\x80\x9d H.R. Rep. No.\n642, supra, at 40; see H.R. Rep. No. 574, supra, at 8-12. Instead of\nrequiring officials to disclose all financial information about their\nspouses, the Act creates exceptions consistent with its objective of\nremoving both the opportunity and the appearance of an opportunity\nfor evasion. A spouse need only report the source, not the amount, of\nhis or her earned income. \xc2\xa7 202(e)(1)(A). Gifts and reimbursements\n\xe2\x80\x9creceived totally independent of the spouse\xe2\x80\x99s relationship to the report\xc2\xad\ning individual,\xe2\x80\x9d \xc2\xa7 202(e)(1)(B), (C), need not be reported. A spouse\xe2\x80\x99s\nliabilities, interests in property, and sales or exchanges of property need\nnot be reported i\xc2\xa3 four conditions are met: the official certifies that they\n\xe2\x80\x9crepresent the spouse\xe2\x80\x99s . . . sole financial interest or responsibility\xe2\x80\x9d; the\nofficial \xe2\x80\x9chas no knowledge o f \xe2\x80\x99 them; they \xe2\x80\x9care not in any way, past or\npresent, derived from the income, assets, or activities of the reporting\nofficial\xe2\x80\x9d and the official \xe2\x80\x9cneither derives, nor expects to derive, any\nfinancial or economic benefit\xe2\x80\x9d from them. \xc2\xa7 202(e)(1)(D).5 In addition,\nNo report shall be required with respect to a spouse living\nseparate and apart from the reporting individual with the\nintention of terminating the marriage or providing for\npermanent separation; or with respect to any income or\nobligations of an individual arising from the dissolution of\nhis marriage or the permanent separation from his spouse.\n\xc2\xa7 202(e)(2).6 Clearly, then, Congress was not simply appeasing the\npublic\xe2\x80\x99s general curiosity about the private financial affairs of high\n5 T he official claims (hat (hese provisions\xe2\x80\x94specifically, the term s \xe2\x80\x9cno know ledge" and \xe2\x80\x9cexpects to\nderive . . . financial o r econom ic benefit"\xe2\x80\x94are unconstitutionally vague. On its face this claim is\nimplausible; these term s are used frequently both in the law and in o rdinary language and are seldom\nthought to be unusually unclear. In addition, the official here does not argue that their alleged\nvagueness affects him; that is, he does not say that he finds it difficult to decide w hether these\nprovisions require him to disclose certain o f his w ife\'s separate interests. U nder these circum stances we\n\xe2\x80\xa2see no reason to deny the enforcing agencies the opportunity to gloss any unclear provisions and make\ntheir meaning m ore plain. M oreover, only know ing o r willful violations o f the disclosure provisions\ncan be punished. \xc2\xa7204. Because a violation caused by genuine uncertainty about the meaning o f the\nprovision w ould very likely be held not to be willful, these provisions may not present a constitutional\nproblem even if their meaning is unclear.\n6 T he disclosure provisions apply only to cohabiting spouses, not to o th e r people w ho are living\ntogether and w hose finances might be equally intertw ined. T h e official argues that this unconstitution\xc2\xad\nally deters m arriage and discrim inates against m arried couples in favor o f unm arried couples. Any\nContinued\n\n345\n\n0\n\n\x0cofficials\xe2\x80\x99 families; it was seriously grappling with the dangers of various\npossible conflicts of interest.\nCongress also attempted to limit the damage that might be caused by\nany invasion of an official\xe2\x80\x99s privacy. The financial disclosure reports\nfiled by officials must be destroyed after 6 years. \xc2\xa7 205(d). Under pain\nof a civil penalty, see \xc2\xa7 205(c)(2), members of the public to whom the\nreports have been disclosed may not used them for commercial pur\xc2\xad\nposes, to establish credit ratings, or \xe2\x80\x9cdirectly or indirectly, in the\nsolicitation of money for any political, charitable, or other purpose.\xe2\x80\x9d\n\xc2\xa7 205(c)(1)(D). Congress recently amended the Act to make these pro\xc2\xad\nvisions easier to enforce. See \xc2\xa7 205(b)(2); H.R. Rep. No. 114, 96th\nCong., 1st Sess., 5-6 (1979).\nFinally, the Executive Branch disclosure provisions apply only to\nhigh-level officials. See \xc2\xa7 201(f). In the case law dealing with statutes\nlike the Ethics in Government Act, this has been a crucial concern. In\ngeneral, courts have been hostile to state financial disclosure legislation\nonly when it applied to all officials or to officials with no significant\nresponsibility for making policy. Compare Slevitt v. City o f New York,\n477 F. Supp. 1051 (S.D.N.Y. 1979), City o f Carmel-by-the-Sea v. Young,\n2 Cal. 3d 259, 466 P.2d 225, 85 Cal. Rptr. 1 (1970), and Advisory\nOpinion on Constitutionality o f 1975 PA 227 (Questions\'2-10), 396 Mich.\n465, 502-09, 242 N.W.2d 3, 18-21 (1976), with id. at 508, 242 N.W.2d 3,\n20 (noting that statute that was unconstitutional as applied to all offi\xc2\xad\ncials could constitutionally be applied to high officials alone). The Fifth\nCircuit, in addition to upholding the judicial branch disclosure provi\xc2\xad\nsions of the Ethics in Government Act, Duplantier v. United States,\nsupra, has upheld a state statute that applied to high-level officials,\nPlante v. Gonzalez, 575 F.2d 1119 (1978). Several states have sustained\nsimilar statutes. See id. at 1124 n.8 (collecting cases). The Supreme\nCourt has dismissed, for want of a substantial federal question, appeals\nfrom at least two decisions upholding state statutes that required infor\xc2\xad\nmation from high-level state officials about both their own and their\nspouses\xe2\x80\x99 financial interests. Walsh v. Montgomery County, 424 U.S. 901\n(1976), dismissing appeal from 274 Md. 489, 336 A.2d 97 (1975); Fritz v.\nGorton, 471 U.S. 902, dismissing appeal from 83 Wash.2d 275, 517 P.2d\n911 (1974). See also Stein v. Howlett, 412 U.S. 925 (1973), dismissing\nappeal from 52 111.2d 570, 289 N.E.2d 409 (1972). This disposition by\nincidental effect this provision m ight have on a co u p le\'s decision to m arry does not present a\nconstitutional problem. Compare Zablocki v. Redhail. 434 U.S. 374, 387 n.12 (1978), with Califano v.\nJobst. 434 U.S. 47. 54 (1977). C ongress generalized that cohabiting m arried couples are m ore likely to\nhave the sort o f financial relationship, that makes disclosure by both necessary to achieve the\nobjectives o f the A ct; in view o f the significance o f m arriage to family and property law, and\nparticularly th e g reater ease w ith w hich m arried people can share or transfer property interests, this is\na reasonable generalization. Indeed it is difficult to im agine a clear distinction that w ould be more\naccu rate than the one C ongress has draw n. D efining the precise sort o f relationship betw een cohabit\xc2\xad\ning. unm arried people that w ould require them both to disclose if one w ere an official might be a\ncum bersom e task and might itself create constitutional problems.\n\n346\n\n\x0cthe Supreme Court is ordinarily considered a decision on the merits.\nThus precedent strongly suggests that a statute as well-tailored as\nTitle II of the Ethics in Government Act is constitutional.\nFor these reasons, we believe that the government can constitution\xc2\xad\nally require the official in question to disclose the financial information\nabout his spouse specified by the Ethics in Government Act.\nL eon U lm an\n\nDeputy Assistant Attorney General\nOffice o f Legal Counsel\n\n347\n\n\x0c'


b'Use of \xe2\x80\x9cUnanticipated Needs\xe2\x80\x9d Funds to Pay the SecurityRelated Hotel Expenses of a Supreme Court Nominee\nPayment of expenses related to Judge Sotomayor\xe2\x80\x99s hotel stays in Washington, D.C.\nduring the period between her nomination to the Supreme Court and the conclusion of\nher confirmation hearings falls within the President\xe2\x80\x99s discretion under 3 U.S.C. \xc2\xa7 108.\nJanuary 15, 2010\n\nMEMORANDUM OPINION FOR THE\nPRINCIPAL DEPUTY COUNSEL TO THE PRESIDENT\nThis memorandum memorializes advice we previously provided regarding whether the White House could pay certain expenses related to\nthe Supreme Court nomination of then-Judge Sonia Sotomayor out of\nfunds appropriated \xe2\x80\x9cto enable the President, in his discretion, to meet\nunanticipated needs for the furtherance of the national interest.\xe2\x80\x9d 3 U.S.C.\n\xc2\xa7 108(a) (2006). These expenses related to the Judge\xe2\x80\x99s hotel stays in\nWashington, D.C. during the period between her nomination and the\nconclusion of her confirmation hearings. We understand that, during this\nperiod, the Judge met with White House personnel whose official duties\nincluded assisting with her confirmation. We further understand that the\nspecific amount of the expenses was driven in part by the need for Judge\nSotomayor to stay at a hotel at which her security could be ensured. As\nwe understand it, the United States Marshals Service (\xe2\x80\x9cUSMS\xe2\x80\x9d), based on\ninformation obtained shortly after Judge Sotomayor\xe2\x80\x99s nomination, determined that Judge Sotomayor required the protection of a security detail,\nand specifically requested that she stay at a hotel with appropriately\nconfigured entrances. On the facts presented to us, we think that payment\nof these expenses falls within the President\xe2\x80\x99s discretion under 3 U.S.C.\n\xc2\xa7 108.\nOn its face, section 108 confers broad authority on the President to use\ndesignated funds, \xe2\x80\x9cin his discretion, to meet unanticipated needs for the\nfurtherance of the national interest.\xe2\x80\x9d Id. Section 108 expressly provides\nthat the President may exercise this discretionary authority \xe2\x80\x9cwithout\nregard to any provision of law . . . regulating expenditures of Government\nfunds.\xe2\x80\x9d Id. And, consistent with section 108, the appropriations bill for\nthe fiscal year during which the expenses at issue here were incurred\n20\n\n\x0cUse of \xe2\x80\x9cUnanticipated Needs\xe2\x80\x9d Funds to Pay Security-Related Hotel Expenses\n\nappropriated one million dollars \xe2\x80\x9c[f]or expenses necessary to enable the\nPresident to meet unanticipated needs, in furtherance of the national\ninterest, security, or defense which may arise at home or abroad during\nthe current fiscal year, as authorized by 3 U.S.C. 108, . . . to remain\navailable until September 30, 2010.\xe2\x80\x9d Omnibus Appropriations Act, 2009,\nPub. L. No. 111-8, 123 Stat. 524, 643 (2009). The only requirements\nimposed by this language are that the need for which funds are spent be\n\xe2\x80\x9cunanticipated,\xe2\x80\x9d and that the spending of those funds further the \xe2\x80\x9cnational\ninterest, security, or defense.\xe2\x80\x9d\nIn the years before section 108\xe2\x80\x99s enactment in 1978, individual appropriations acts sometimes provided funds to permit the President to respond to unanticipated needs. In earlier years, these funds were appropriated to meet needs arising from \xe2\x80\x9cemergencies.\xe2\x80\x9d In the years closer to\n1978, however, Congress made broader appropriations for needs that were\nsimply \xe2\x80\x9cunanticipated.\xe2\x80\x9d 1 When section 108 was enacted in November of\nIn particular, the appropriations acts for fiscal years 1972, 1973, and 1974 included\nan appropriation of one million dollars for an \xe2\x80\x9cEmergency Fund for the President\xe2\x80\x9d for\n\xe2\x80\x9cexpenses necessary to enable the President . . . to provide in his discretion for emergencies affecting the national interest, security, or defense which may arise at home or abroad\nduring the current fiscal year.\xe2\x80\x9d Treasury, Postal Service, and General Government Appropriation Act, 1972, Pub. L. No. 92-49, tit. III, 85 Stat. 108, 111 (1971); see also Treasury,\nPostal Service, and General Government Appropriation Act, 1973, Pub. L. No. 92-351,\ntit. III, 86 Stat. 471, 475 (1972); Treasury, Postal Service, and General Government\nAppropriation Act, 1974, Pub. L. No. 93-143, tit. III, 87 Stat. 510, 514 (1973). The\nappropriation for fiscal year 1975, similarly, included an appropriation of $500,000 for\n\xe2\x80\x9cUnanticipated Personnel Needs\xe2\x80\x9d for \xe2\x80\x9cexpenses necessary to enable the President to meet\nunanticipated personnel needs, for emergencies affecting the national interest, security, or\ndefense which may arise at home or abroad during the current fiscal year.\xe2\x80\x9d Treasury,\nPostal Service, and General Government Appropriation Act, 1975, Pub. L. No. 93-381,\ntit. III, 88 Stat. 613, 617 (1974).\nThe appropriations acts for fiscal years 1976 through 1979, in contrast, omitted mention of \xe2\x80\x9cemergencies,\xe2\x80\x9d and included an appropriation for \xe2\x80\x9cUnanticipated Needs\xe2\x80\x9d for\n\xe2\x80\x9cexpenses necessary to enable the President to meet unanticipated needs, in furtherance of\nthe national interest, security, or defense which may arise at home or abroad during the\ncurrent fiscal year.\xe2\x80\x9d Treasury, Postal Service, and General Government Appropriation\nAct, 1976, Pub. L. No. 94-91, tit. III, 89 Stat. 441, 445 (1975); see also Treasury, Postal\nService, and General Government Appropriation Act, 1977, Pub. L. No. 94-363, tit. III,\n90 Stat. 963, 968 (1976); Treasury, Postal Service, and General Government Appropriation Act, 1978, Pub. L. No. 95-81, tit. III, 91 Stat. 341, 346 (1977); Treasury, Postal\nService, and General Government Appropriations Act, 1979, Pub. L. No. 95-429, tit. III,\n92 Stat. 1001, 1006 (1978). The House report accompanying one of these acts indicated\n1\n\n21\n\n\x0c34 Op. O.L.C. 20 (2010)\n\n1978, it borrowed this broader language from the appropriations acts that\nimmediately preceded it, and provided funds for unanticipated needs\ngenerally, without any restriction to \xe2\x80\x9cemergencies.\xe2\x80\x9d The House and Senate reports accompanying section 108 noted that it \xe2\x80\x9ccontinues the authority provided by recent appropriations acts for a fund to enable the President, in his discretion, to meet unanticipated needs \xe2\x80\x98for furtherance of\nthe national interest, security, or defense,\xe2\x80\x99\xe2\x80\x9d without mentioning any\nrestriction to emergencies. H.R. Rep. No. 95-979, at 10 (1978); S. Rep.\nNo. 95-868, at 11 (1978). And the practice under section 108 in the decades since its enactment confirms that its scope is not restricted to emergencies. Previous administrations, moreover, have likewise declined to\nconstrue the term \xe2\x80\x9cnational interest\xe2\x80\x9d as a narrow category restricted to\nmatters closely connected with national security or defense, and instead\ninterpreted it as an independent, broad category that gives the President\nthe flexibility needed to exercise his official functions when faced with\nnew problems that arise after the appropriations process for a given year\nhas been completed.\nThus, according to a summary of Executive Office records provided by\nyour office, section 108 appropriations, for example, have been used to\nfund advisory commissions in the Executive Branch, such as the Native\nHawaiians Study Commission and the Council on Wage and Price Stability, that were charged with missions apparently unrelated to national\nsecurity or defense. See Executive Office of the President, Unanticipated\nNeeds History at 1 (FY 1972\xe2\x80\x93present) (\xe2\x80\x9cUnanticipated Needs History\xe2\x80\x9d);\nsee also Budget of the United States Government, Fiscal Year 1984, app.\nat I-D3; Budget of the United States Government, Fiscal Year 1982\n(\xe2\x80\x9cBudget FY 1982\xe2\x80\x9d), app. at I-D4. Other uses of section 108 funds have\nincluded unspecified expenditures for the White House Office, the Irancontra hearings, the U.S. Secret Service, Geneva Mission security for the\nOffice of the U.S. Trade Representative, presidential foundation expenses\nfor the funerals of Presidents Reagan and Ford, White House Office\nthat the purpose of the appropriation was to provide \xe2\x80\x9ca resource that the President can\neffectively use to solve problems that occur after the appropriation process has been\ncompleted.\xe2\x80\x9d H.R. Rep. No. 95-378, at 25 (1977). The report went on to observe that \xe2\x80\x9c[t]he\nappropriation of funds is a time consuming process and the President ought to have some\ndegree of flexibility to handle unforeseen emergencies,\xe2\x80\x9d id., although\xe2\x80\x94as noted\xe2\x80\x94the\nterms of the act were broad and not limited to \xe2\x80\x9cemergencies.\xe2\x80\x9d\n\n22\n\n\x0cUse of \xe2\x80\x9cUnanticipated Needs\xe2\x80\x9d Funds to Pay Security-Related Hotel Expenses\n\nexpenses for President Ford\xe2\x80\x99s funeral, and an Office of Administration\ne-mail restoration initiative. See Unanticipated Needs History at 1\xe2\x80\x933; see\nalso Budget FY 1982, app. at I-D4; Budget of the United States Government, Fiscal Year 1989, app. at I-D1; Letter for Susan M. Collins, Chairwoman, Senate Committee on Homeland Security, from John Straub,\nSpecial Assistant to the President, encl. (Mar. 20, 2006) (Unanticipated\nNeeds Account); Letter for Harry Reid, Senate Majority Leader, from\nAlan R. Swendiman, Special Assistant to the President, encl. (Nov. 23,\n2007) (Unanticipated Needs Account); Letter for Harry Reid, Senate\nMajority Leader, from Sandra K. Evans, Special Assistant to the President, encl. (Nov. 4, 2008) (Unanticipated Needs Account). These expenditures have been reported to Congress on a yearly basis and Congress, far\nfrom viewing them as inappropriate, has continued to appropriate funds\nfor unanticipated needs virtually every year. 2 Finally, and even more\ndirectly, this Office has previously suggested that the President\xe2\x80\x99s discretion under section 108 may include the authority to pay travel expenses\nincurred by persons who are not employees of the government but who\nare traveling for purposes related to the duties of the President. See Memorandum for Michael E. Shaheen, Jr., Counsel, Office of Professional\nResponsibility, from Robert B. Shanks, Deputy Assistant Attorney General, Office of Legal Counsel, Re: Use of Department of Justice Vehicles\nat 13 n.12 (Jan. 23, 1984) (explaining that, \xe2\x80\x9c[u]nlike the Attorney General, the President has several possible sources of appropriated funds from\nwhich a nonemployee traveling for official purposes of the Presidency\nmight be paid expenses,\xe2\x80\x9d and citing section 108).\nIn light of section 108\xe2\x80\x99s broad language and this prior practice and\nprecedent, we believe use of \xe2\x80\x9cunanticipated needs\xe2\x80\x9d funds to pay for the\nexpenses at issue here would be permissible. The timing of Justice David\nSouter\xe2\x80\x99s resignation announcement may fairly be described as \xe2\x80\x9cunanticipated,\xe2\x80\x9d giving rise to the associated costs of ensuring that the nominee\nwho had been named to replace him would be readily available to the\nWhite House personnel who are officially responsible for assisting with\nBased on the information you provided, the only year in which Congress did not\nappropriate section 108 funds was in fiscal year 1997, when the one million dollars\nrequested for unanticipated needs were diverted to fund conferences on model state drug\nlaws through the Office of National Drug Control Policy. See Unanticipated Needs\nHistory at 3 n.1.\n2\n\n23\n\n\x0c34 Op. O.L.C. 20 (2010)\n\nthe confirmation process. Moreover, the particular expenses at issue here\nmay also be characterized as \xe2\x80\x9cunanticipated,\xe2\x80\x9d given that the USMS unexpectedly received information about the President\xe2\x80\x99s nominee that caused\nit to determine that she required the protection of a security detail, and to\nrequest that she stay at a hotel with appropriate security features. And we\nthink it is in furtherance of the national interest to protect the security of\na Supreme Court nominee prior to confirmation and swearing in, as well\nas to ensure that the President\xe2\x80\x99s advisors may effectively and efficiently\nassist him in carrying out his constitutional authority to appoint a nominee\nto the Supreme Court to fill a vacancy in that body. (We also understand\nthat the cost of housing Judge Sotomayor in Washington during the confirmation process was significantly less than the expected cost of moving\nthe White House preparation team to New York to meet with Judge Sotomayor there.) We therefore conclude that Judge Sotomayor\xe2\x80\x99s expenses\nmay properly be paid with funds appropriated under section 108.\nJEANNIE S. RHEE\nDeputy Assistant Attorney General\nOffice of Legal Counsel\n\n24\n\n\x0c'