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Conway for Senate v. Federal Election Commission

United States District Court, Sixth Circuit

August 19, 2013

CONWAY FOR SENATE, Plaintiff,
v.
FEDERAL ELECTION COMMISSION, Defendant.

MEMORANDUM OPINION

CHARLES R. SIMPSON, III, Senior District Judge.

Plaintiff Conway for Senate, the principal campaign committee for Jack Conway in his 2010 campaign for United States Senate, brought this action to challenge a civil monetary penalty assessed against it by Defendant Federal Election Commission ("FEC") for failing to file a required report. The parties have cross-moved for summary judgment (DNs 15 and 16). For the reasons stated herein, the FEC's motion for summary judgment will be granted.

I.

Pursuant to the Federal Election Campaign Act ("FECA"), a principal campaign committee for a candidate for the Senate must periodically file various reports, including quarterly reports. 2 U.S.C. § 434(a)(2)(iii). Those quarterly reports are due by the 15th day of the month following the calendar quarter, except that the report for the period ending December 31st (the "year-end report") must be filed by January 31st of the following year. Id. To file a report, a campaign committee for a senatorial candidate is required to send it to the Secretary of the Senate, who receives the reports as custodian for the FEC. 2 U.S.C. § 432(g)(1). The Secretary of the Senate must then forward a copy of the report to the FEC within 2 working days. 2 U.S.C. § 432(g)(2).

If a campaign committee fails to timely file reports, the FEC may assess civil penalties against the campaign committee. 2 U.S.C. § 437g(a)(4)(C)(i)(II). FEC regulations set forth a schedule of penalties that takes into account whether the report was not filed or was merely late, how late the report was, the dollar amount of activity in the report, and whether the report was one that is deemed "election sensitive." 11 C.F.R. § 111.43(a)-(c). FEC regulations also detail that reports that are not election sensitive are deemed late if filed after their due dates but within thirty days of the due dates; after that, the reports are considered to be not filed. 11 C.F.R. 111.43(e)(1).

II.

In December of 2010, the FEC sent a notice to Conway for Senate stating that its year-end report was due on January 31, 2011. On January 25, 2011, Conway for Senate sent an envelope containing various reports via FedEx Priority Overnight to the Senate Office of Public Records. According to Conway for Senate, the year-end report was one of the reports in that envelope. The FEC, however, states that it did not receive the year-end report in that envelope.

On February 17, 2011, the FEC sent a notice to R. Wayne Stratton, Conway for Senate's Treasurer, stating that the year-end report had not been filed. On March 10, 2011, Stratton sent a letter to the Senate Office of Public Records protesting that the campaign committee had sent a copy of the year-end report in the January 25, 2011 FedEx shipment. Stratton included with the letter a copy of the year-end report.[1]

In a March 30, 2011 memorandum, the FEC's staff recommended that the FEC find "reason to believe" that a civil penalty of $4, 950 should be imposed upon Conway for Senate for having not filed the year-end report.[2] The FEC unanimously approved that recommendation on April 1, 2011. On April 4, 2011, the FEC sent Stratton a letter informing him of the reason-to-believe finding, explaining the basis for the imposition of the civil penalty, and explaining how Conway for Senate could challenge the penalty.

By letter dated May 4, 2011, Conway for Senate challenged the imposition of the penalty. Attached to the letter was an affidavit from Lynn-Marie Johnson, a receptionist at Stratton's accounting firm, stating that she had placed the year-end report, along with other items, in the January 25, 2011 FedEx shipment.

Dayna Brown, a Reviewing Officer in the FEC's Office of Administrative Review, acknowledged receipt of the challenge. Brown contacted the Superintendent of the Office of Public Records of the Senate and asked that the Office of Public Records to review its records to determine whether it had received Conway for Senate's 2010 year-end report in January of 2011. The Superintendent of the Office of Public Records responded to Brown via letter. The letter stated that the Office of Public Records had reviewed "the original documents and the original Fedex envelope shipped on January 25, 2011." The letter continued, "As reflected in our public database, the original documents confirmed that our office received 5 separate reports in the Fedex envelope shipped on January 25, 2011." After identifying the five reports that had been received, the letter stated that the Office of Public Records did not receive the 2010 year-end report in that January 25, 2011 envelope.

On June 29, 2011, Brown completed a preliminary recommendation that the FEC make a final determination that Conway violated 2 U.S.C. § 434(a) and assess a civil penalty of § 4, 950. In her recommendation, Brown noted the results of her correspondence with the Superintendent of the Office of Public Records. Brown further noted that a written record of a telephone call between Stratton and an FEC Analyst indicated that Stratton had told the FEC Analyst that the year-end report was sent on January 25, 2011, but separately from the other documents - a statement that was inconsistent with Johnson's statement in her affidavit that she placed the year-end report in the same FedEx envelope as the other documents received by the FEC.

Brown mailed a copy of her preliminary recommendation to Stratton. In turn, Stratton submitted a letter responding to Brown's recommendation. In his letter, Stratton denied ever having stated that the year-end report was sent separately from the other Conway for Senate reports that the FEC had received. Stratton further sought to describe the campaign committee's report preparation process. He noted that campaign employee Nick Braden prepared the reports and e-mailed them to Stratton and a law firm for review. Braden then made any necessary corrections and e-mailed finalized copies to Stratton for Stratton's signature. Then, Paula Pasley, the Office Administrator at Stratton's accounting firm, printed the reports from Braden's e-mail and assembled them for Stratton's signature. As evidence of that process, Stratton attached to his letter various pieces of evidence. In particular, he attached an e-mail dated January 24, 2011 from Braden to Stratton and Pasley that indicated that the "Q4 report" was in a file attached to the e-mail. Stratton also attached an affidavit of Pasley stating that Braden had e-mailed her several reports, including the 2010 fourth quarter report, which she printed out, had Stratton review, and then turned over to Johnson for mailing. Pasley's affidavit also stated that she had spoken to Raymond Davis of the Office of Public Records, who had indicated that it was "possible" that the Senate Sergeant-at-Arms, who was responsible for opening the envelope sent by Conway for Senate and then forwarding it to the Office of Public Records, had failed to put the year-end report back in the envelope before he forwarded it. Finally, Stratton attached to his letter a copy of the previously-submitted affidavit of Johnson in which she stated that she had placed multiple reports, including the year-end report, in a FedEx envelope that was mailed on January 25, 2011 and delivered the following day.

On March 28, 2012, after having reviewed Stratton's letter, Brown issued a final recommendation to the FEC. Brown essentially credited the Office of Public Records' letter stating that it did not receive the year-end report in the January 25, 2011 mailing. Brown also addressed Pasley's suggestion that the Senate Sergeant-at-Arms might have lost the report. Brown stated that she had spoken with Davis, the Office of Public Records employee to whom Pasley had spoken. Davis told Brown that after he spoke with Conway for Senate staff, he contacted the Senate Sergeant-at-Arms. The ...


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