Archives for 2016

The EPA Must Account For Its Actions (Judge Lechner op-ed)


ALFRED J. LECHNER, JR. – 10/07/2016
Federal regulation is the American economy’s silent killer. Every day, the vast bureaucracy in D.C. issues reams of red tape that stifle the creation of new jobs or snuff out good-paying jobs that already exist.

That is why my organization, Cause of Action Institute, has formally petitioned one of the most regulation-happy federal agencies — the Environmental Protection Agency (EPA) — to fulfill its statutory requirement to investigate the careers and opportunities it has crushed.

The Clean Air Act, signed into law by President Lyndon B. Johnson in 1963, contains a little-known provision that enables individuals who have lost their jobs to ask the EPA to examine whether its regulatory actions were at fault. Upon receiving such requests, the agency must conduct an investigation and potentially hold public hearings. Congress specifically included this requirement to better gauge the impact of EPA regulations on the American job market.

Unfortunately, 50 years after the Act’s passage, the EPA has still not set up this process, much less given it teeth. As a result, Americans who wish to request an investigation have no idea where to start; this undoubtedly dissuades many from trying.

Equally concerning, the agency has failed to establish any rules to guide its actions. This enables the EPA to tilt the few investigations it does undertake in its own favor — or ignore requests entirely. [Read More…]

Cause of Action Institute Investigates Arizona Electrical Market

Cause of Action Institute is investigating the battle for retail market share in Arizona between electric power for consumers and businesses regulated and controlled by the Arizona Corporation Commission (“ACC”), and rooftop solar competition, including competition from SolarCity Corp., (“SolarCity”). The ACC is a quasi-executive regulatory agency in the Arizona state government. It is Arizona’s state regulatory body for non-municipal utility companies, including energy, heat, trash, water and communications firms. The ACC also oversees the incorporation of businesses, securities regulation and railroad/pipeline safety.

SolarCity provides technologies for mounting solar panels on rooftops developed by Zep Solar, which it acquired in 2013. Zep is best known for inventing a system that allows solar photovoltaic installers to join panels on the roof more quickly than other installation approaches to shorten installation time. SolarCity was co-founded in 2006 by brothers Lyndon Rive (CEO) and Peter Rive (CTO). Their cousin is Elon Musk, who serves as SolarCity’s Chairman. On August 1, 2016, SolarCity accepted Tesla Motors’ (Musk’s car company) offer to acquire the company for $2.6 billion. As of August 2016, Musk owned 22% of SolarCity stock.

Cause of Action Institute is seeking records and information regarding the FBI’s long-term, ongoing investigation of the financing of certain Arizona statewide electoral races in the 2014 election cycle, and the Arizona Public Service (“APS”), which spent unprecedented millions of dollars over the last three years to allegedly influence the regulators on the ACC. Additionally, CoA Institute is examining the relationship(s) between the Checks and Balances Project of Arizona (“CBP”), SolarCity, Save Our AZ Solar, Energy Choice for America, Renew American Progress, and Elon Musk, including but not limited to, the Bureau’s interactions with Scott Petersen of CBP, and former ACC Commissioner Gary Pierce, as well as any White House involvement in the FBI investigation’s genesis.

You can read the Cause of Action Institute FOIA request here.

Patrick Massari is Counsel at Cause of Action Institute

Editing the Facts of Terrorism to Fit Obama’s Narrative (Judge Lechner op-ed)

the-daily-signalAlfred J. Lechner Jr. | October 04, 2016  

In the early morning hours of June 12, an armed terrorist named Omar Mateen opened fire in a nightclub in Orlando, Florida. The next morning, Americans awoke to the news that 49 people had been murdered—the largest mass shooting in American history.

This heinous act left Americans, as well as the Orlando community, grieving and searching for answers. But for several days after the shooting, the Justice Department knowingly curtailed the release of information about the shooter’s motives. [Read More…]

September Newsletter

Cause of Action Institute published its September newsletter today. You can read the newsletter here and subscribe to the newsletter here.  The September newsletter highlights:

  • documents CoA Institute recently obtained through FOIA revealing a secret agreement between the IRS and the White House to exempt IRS rules from prepublication review;
  • details of our investigation into taxpayer reimbursements for luxury travel of a political appointee and cash payments to Iran; and
  • links to a recent op-ed Judge Lechner wrote about the spread of partisan politics into the Cabinet and to several press stories about recent CoA Institute activities.


Court Rightly Denies Rep. Van Hollen Request to Rehear Free Speech Case

Supporters of free speech and the First Amendment won a significant victory this week when a federal court denied a last ditch effort by Congressmen (and Senatorial candidate) Chris Van Hollen (D-Md.) to salvage his campaign finance case.

On January 21, 2016, a DC Circuit panel reversed the District Court for the District of Columbia and upheld a Federal Election Commission (“FEC”) regulation requiring unions and corporations (including nonprofit organizations) to disclose only those contributors who donate for the purpose of funding an election campaign.

Van Hollen had sued the FEC, arguing that such organizations should be required to reveal all donors, not just those that donate for an election. On appeal to the DC Circuit, CoA Institute filed an amicus brief in support of free speech principles. The DC Circuit agreed with the CoA Institute position that the FEC had struck an acceptable balance between disclosure requirements and First Amendment protections.  In so doing, the Court emphasized a number of points made in the CoA Institute brief, particularly the importance of protecting the constitutional rights of contributors to privacy and anonymous speech.

Following the DC Circuit decision, Van Hollen moved the entire DC Circuit to rehear the case (a rehearing en banc).  On September 27, 2016, the full court denied the petition.  Pending a Supreme Court appeal, the DC Circuit decision is now final.

Cause of Action Institute Investigates Taxpayer Bailout of ObamaCare Insurance Companies

Washington, D.C. – Cause of Action Institute (CoA Institute) today sent a Freedom of Information Act (FOIA) request to the Centers for Medicare and Medicaid Services (CMS) to investigate the Obama administration’s apparent attempt to bailout insurers through judicial settlements to compensate for shortfalls in the Affordable Care Act (ACA) risk corridors program.

CoA Institute President and CEO, and former federal judge, Alfred J. Lechner, Jr.: “The continuing failures of the ObamaCare Risk Corridors Program raise serious concerns about the long-term viability of the program.  It appears the administration is attempting to circumvent the law by bailing out insurance companies through judicial settlements. Americans deserve to understand how far the administration is willing to go to prop up a failing program with taxpayer money.”

Under the ACA, the Risk Corridors Program was supposed to collect payments from insurers with lower than expected losses and redirect the money to subsidize insurers with higher than expected losses. But because of the monetary shortfalls in the risk corridors program, payouts have been limited.

On September 9, 2016, CMS released a document entitled “Risk Corridors Payments for 2015,” stating that “no funds will be available at this time for 2015 benefit year risk corridors payments.” More concerning, the CMS document essentially invites judicial settlements with insurance companies:

We know that a number of issuers have sued in federal court seeking to obtain the risk corridors amounts that have not been paid to date. As in any lawsuit, the Department of Justice is vigorously defending those claims on behalf of the United States. However, as in all cases where there is litigation risk, we are open to discussing resolution of those claims. We are willing to begin such discussions at any time.

The CMS document raises serious questions about the intentions of the administration to fund the risk corridors program. Moreover, the U.S. Department of Justice Office of Legal Counsel has also determined that these “backdoor bailouts” are improper.

CoA Institute today requested all records referring to a lack of funds for risk corridors payments to insurance companies, as well as all records related to the September CMS document entitled “Risk Corridors Payments for 2015.”

The full FOIA can be found here.

Cause of Action Institute Secures Access to Secret IRS Memos with the White House

Washington, D.C. – Cause of Action Institute has secured access to a series of previously undisclosed memoranda of agreement between the IRS and the White House, which the IRS claims exempts it from prepublication review of its rules.  The release includes agreements between the IRS and White House from 1983 and 1993 that contain “exemptions from regulatory review.”

The IRS has resisted providing the memos to Congress, which have been sought by the Senate Finance Committee but to-date have not yet been provided.  The memos were also discussed in a recently released Government Accountability Office audit.  However, until today, the memos have not been made public.

Click here to access the memos.

Cause of Action Institute President and CEO, and former federal judge, Alfred J. Lechner, Jr.: “Agencies of the federal government should not operate by secret agreement with the White House.  Lawful prepublication reviews are critical to the regulatory process to ensure that rules are developed in a fair and transparent manner. The IRS has skirted these rules for far too long.”

Typically, agencies submit their rules to the White House Office of Management and Budget (OMB) for regulatory review before publication.  However, the IRS has long claimed an exemption from this rule.  As Cause of Action Institute argued to the Supreme Court in an amicus brief, “Over the past ten years, the IRS has submitted only eight rules to OIRA [the Office of Information and Regulatory Affairs] for regulatory review and deemed only one of those rules significant.  Those eight rules are less than one percent of the final rules the IRS published in the Federal Register over the same period.”