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Archives for March 2018

03/30/2018

CoA Institute Lawsuit Prompts Archivist to Examine Potential Record Destruction at NOAA

Cause of Action Institute (“CoA Institute”) filed a lawsuit last summer against the National Oceanic and Atmospheric Administration (“NOAA”) seeking copies of electronic records created through the agency’s Google-based email platform.  These types of records are commonly known as “instant messages.”  The Freedom of Information Act (“FOIA”) requests at issue (available here and here) also sought formal agency guidance on the retention of “Google Chat” or “Google Hangouts” messages.  We had already learned, through earlier investigation, that at least one internal NOAA handbook, dating from March 2012, instructed agency employees to treat all chat messages as “off the record,” raising concerns about potential unlawful record destruction at NOAA.

Media Coverage of CoA Institute’s Lawsuit Tipped-off the National Archives

The Daily Caller News Foundation reported on CoA Institute’s lawsuit shortly after it was filed.  Officials at the National Archives and Records Administration (“NARA”), which is tasked with policing federal records management across the government, took notice of the story and subsequently opened an inquiry on July 17, 2017 into CoA Institute’s allegations.  NARA gave NOAA “30 calendar days” to indicate how it planned to address the retention of “Google Chat and Skype messages,” and, if necessary, to report an “unauthorized disposition,” that is, the improper destruction of records.

As far as we know, eight months later, NOAA still has not responded to NARA.  We only learned about the NARA inquiry due to the agency’s recent decision to proactively disclose information on all pending investigations into the unauthorized disposition of federal records.  We have filed FOIA requests with NOAA and NARA in order to discover the status of the inquiry, and we will provide further updates as more details become available.

The fact that CoA Institute had to file a FOIA request to obtain NOAA’s response to the NARA inquiry, as well as related communications, shows that NARA’s proactive disclosure regime on this topic could be improved.  NARA should add another category of materials to its webpage that includes all correspondence received from an agency under investigation for the improper treatment of records.

NOAA’s Questionably Legal Google Chat Policy Flouts NARA Guidance

It goes without saying that an agency-wide policy to treat all chat messages as categorically “off the record” is problematic.  Even if an agency expects its employees to keep business-related communications, which could qualify for retention under the Federal Records Act (“FRA”), off a chat-based platform, it is reasonable to assume that some messages worthy of preservation will be sent or received over instant messaging.  NARA Bulletin 2015-02 makes that point clear.  And even if some instant messages were not worthy of long-term historical preservation, they would still qualify as transitory records subject to NARA-approved disposition schedules.

A categorical policy such as the one that NOAA has adopted creates a moral hazard.  Officials who want to thwart transparency can communicate with chat or instant messaging and, at least in this case, there is no way for the agency, NARA, or the public to catch them in the act.  NOAA officials have been observed using Google Chat to communicate during a contentious meeting of the New England Fishery Management Council.  If an agency like NOAA refuses to police how its employees are using the chat function on their Google-based email accounts, it should disable the function all together.

Regardless of whether electronic messages created through Google Chat or Google Hangouts are subject to the FRA, they may still be subject to the FOIA, which defines an “agency record” in broader terms than the FRA’s definition of a “federal record.”  By failing to implement any sort of mechanism for preserving chat messages—even for the briefest period—NOAA is depriving the American public of access to records that could be particularly important in showing how the agency operates and regulates.

The worst part of this saga is that NOAA knew it was treading a thin line in deciding to treat Google Chat messages as “off the record.”  According on documents obtained through the FOIA, NOAA’s lawyers and records management specialists were aware that electronic messages would need to be saved for public disclosure if Google Chat were “on the record.”  Notes from an October 20, 2011 meeting reflect this:

NOAA also recognized that chat messages could, in theory, be subject to the FRA.  Yet NOAA Records Officer Patricia Erdenberger reasoned that, by treating Google Chat as “off the record,” the agency’s FRA obligations could be bypassed.  Making a questionable analogy to phone calls, Erdenberger suggested that chat messages be “considered transient electrons.”

Agencies must do a better job at keeping pace with evolving forms of technology.  As one of my colleagues has argued, the use of non-email methods of electronic communication—including text and instant messaging, as well as encrypted phone applications like Signal—has serious implications for federal records management.  The Department of Commerce, NOAA’s parent agency, has not updated it policy for handling electronic records since May of 1987.  NARA, for its part, has been critical of the Department’s failure to revise this guidance, which is “heavily oriented towards the management of digital records on storage media such as diskettes and magnetic tape.”  Still, thirty years is a long time for such inaction, even for the federal government.  The transparency community must therefore intensify its efforts to hold the government accountable until more effective ways of handling electronic records are introduced.

Ryan Mulvey is Counsel at Cause of Action Institute

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03/28/2018

Obstruction of the Tax Code: Supreme Court Limits Gov’t Power to Criminalize Sloppy Tax Filers

Did you commit a felony when you made those cash payments to your babysitter?  Last week, the United States Supreme Court issued an opinion answering the question as decisively, no. “Please,” you are probably thinking, “that could never have been the case.” But according to the federal government’s arguments in a recent criminal tax case at our nation’s highest court, such conduct could have constituted felony obstruction of the tax code if you knew your babysitter was likely not going to report the income to the IRS.

Under the government’s requested interpretation of 26 U.S.C. § 7212(a), which punishes anyone who corruptly obstructs or impedes the due administration of the tax code, such a payment to the babysitter would be “corrupt” because it would help another obtain an unlawful benefit (not paying taxes) and impede the IRS’s ability to collect those taxes.  In Marinello v. United States, however, Justice Breyer delivered a 7-2 decision that decisively narrowed the scope of conduct that constitutes felony obstruction of the tax code.  The decision should leave every taxpayer relieved that they cannot unwittingly become subject to criminal prosecution.

Cause of Action Institute filed one of only two “friend of the court” briefs at the certiorari stage, in partnership with the National Association of Criminal Defense Lawyers.  The two organizations partnered again at the merits stage to file a second “friend of the court” brief in support of Mr. Marinello’s position.

Carlo Marinello, II owned a small courier service in New York.  In 2012, the United States obtained an indictment against him for failure to file tax returns and for obstruction under 26 U.S.C. § 7212(a)’s “omnibus clause” of the criminal tax code, which makes it a felony to “in any other way corruptly…obstruct [] or impede [] or endeavor to obstruct or impede, the due administration” of the tax code.  The government argued that Mr. Marinello obstructed the administration of the tax code when he failed to maintain books and records for his small business, failed to provide his accountant with complete information, and discarded business records and receipts.  The government argued that these otherwise innocuous (and perfectly legal) acts were criminal because they impeded the IRS’s administration of the tax code and were done “corruptly” because they helped him obtain an unlawful benefit—evading taxes.  However, the tax code separately criminalizes tax evasion and failure to file tax returns and requires that the government prove that the defendant acted “willfully,” a heighted criminal intent, in committing these crimes.

Disagreeing with the government, the Supreme Court held that the “due administration of the tax code” as referenced in section 7212(a) did not cover any and all governmental efforts to collect taxes.  Rather, the clause refers to the specific interference with targeted governmental tax-related proceedings, such as a particular investigation or audit.  Specifically, the Supreme Court held that to secure a conviction under the “omnibus clause,” the government must show (among other things) that there is a “nexus” between the defendant’s conduct and a particular administrative proceeding, such as an investigation, an audit, or other targeted administrative action.  The government must also prove that the investigation or audit was pending at the time the defendant engaged in in the obstructive conduct or was at least reasonably foreseeable by the defendant.  Marinello v. United States, 584 U.S. __, __ (2018) (slip op., at 11).   In other words, the defendant’s actions must obstruct a currently pending proceeding or specific IRS audit.  This reasoning was based on a similarly worded criminal statute pertaining to the obstruction of “justice” as interpreted by the Supreme Court.  See United States v. Aguilar, 515 U.S. 593 (1993) (requiring proof that the defendant obstructed a specific pending proceeding, not just the government’s broad administration of justice).

With regard to a taxpayer’s payment to a babysitter, and citing an IRS regulation, Justice Breyer remarked the government’s interpretation of the statute could result in felony prosecution for a person who pays a babysitter $41 per week in cash without withholding taxes, leaves a large cash tip in a restaurant, fails to keep charity donation receipts, or fails to provide every record to an accountant.  As Justice Breyer stated, “[a] taxpayer may know with a fair degree of certainty that her babysitter will not declare a cash payment as income—and, if so, a jury could readily find that the taxpayer acted to obtain an unlawful benefit for another.”  The Supreme Court stated that if Congress had intended this result, it would have spoken with more clarity.

Justice Breyer further emphasized that criminal statutes must be narrowly interpreted and that courts cannot rely on promises of prosecutorial discretion to narrow the scope of a statute.  The Supreme Court has “traditionally exercised restraint in assessing the reach of a federal criminal statute, both out of deference to the prerogatives of Congress and out of concern that a fair warning should be given to the world in language that the common world will understand of what the law intends to do if a certain line is passed.”  Marinello, 584 U.S. at __ (slip op., at 4).  Moreover, the Court’s review of the broader statutory context of the entire Internal Revenue Code further counseled against adopting the government’s broad reading.  The Court noted that the tax code “creates numerous misdemeanors, ranging from willful failure to furnish a required statement to employees, section 7204, to failure to keep required records, 7203, to misrepresenting the number of exemptions, 7205, to failure to pay any tax owed, however small the amount, 7203.”  The Court stated that to interpret the statute as applying to any administration of the tax code would potentially transform many, if not all, of these misdemeanor provisions into felony obstruction, making the specific provisions redundant, or perhaps the subject matter of plea bargaining.  Id.  According to Justice Breyer, the government’s preferred interpretation would render superfluous many of the provisions of the same enactment, something that Congress could not have intended when it codified section 7212(a).

The Court further noted that it could not trust that prosecutorial discretion would limit the government’s use of the clause.  At oral argument, the government attorney conceded that under the Attorney General’s Charging and Sentencing Policy, where a more-punitive and less-punitive criminal statute may apply to a case, the prosecutor must charge a violation of the most punitive statutory provision that it can readily prove at trial.  Office of the Attorney General, Department Charging and Sentencing Policy (May 10, 2017).  To rely upon prosecutorial discretion to narrow the otherwise wide-ranging scope of a criminal statute’s highly abstract general statutory language places great power in the hands of the prosecutor. Marinello, 584 U.S. at __ (slip op., at 9).  The Court refused to construe the criminal statute on the assumption that the government will use it responsibly. According to Justice Breyer, doing so risks allowing “policemen, prosecutors, and juries to pursue their personal predilections,” id. (citing Smith v. Goguen, 415 U.S. 566, 575 (1974), which could result in the nonuniform execution of that power across time and geographic location.” Marinello, 584 U.S. at __ (slip op., at 9).

The Supreme Court’s holding is an important one for the rule of law, limiting the scope of overly broad criminal statutes, and protecting average taxpayers.

Erica Marshall is counsel at Cause of Action Institute

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03/27/2018

Congress Throws Fishermen a Lifeline

Congress gave groundfishermen in New England a new lease on life when it appropriated funds last week to cover the cost of the At-Sea Monitoring program for 2018.  The National Oceanic and Atmospheric Administration (“NOAA”) requires groundfishermen—who target bottom-dwelling fish like cod or flounder—to carry at-sea monitors on their boats and, as of 2015, requires the fishermen to pay the costs associated with these monitors, which can exceed $700 per day.  By NOAA’s own estimates, this could put nearly 60% of the groundfishing fleet out of business.  Small, family-run businesses would be hit hardest.  CoA Institute released a short video with its client, David Goethel, that describes the destructive impact industry-funded monitoring will have on fishermen’s lives.

Judicial Review

CoA Institute filed suit on behalf of the fishermen in 2015. In 2017, the First Circuit Court of Appeals ruled that the fishermen filed their lawsuit too late because the underlying regulation was promulgated in 2010.[1]  The statute governing the fishing industry—the Magnuson-Stevens Act—has a review period of only thirty days after the finalization or implementation of a regulation for a legal challenge.  Although CoA Institute argued that imposing costs on industry for the first time in November 2015 should have restarted the clock for a legal challenge, the Court disagreed.  But the First Circuit did note that:

[G]iven NOAA’s own study which indicated that the groundfish sector could face serious difficulties as a result of the industry funding requirement, we note that this may be a situation where further clarification from Congress would be helpful for the regulated fisheries and the agency itself as it balances the competing goals of conservation and the economic vitality of the fishery.

Congress Steps Up

Congress appears to have taken notice by appropriating the funds necessary to cover at-sea monitoring costs for Fiscal Year 2018.  Congress also gave specific instructions to NOAA in order to avoid any ambiguity and ensure that the agency uses these funds for their intended purpose.

This is not a permanent solution but, for now, it will allow fishermen to stay afloat.  In the future, if regulators want to continue to impose constitutionally suspect monitors on an already-beleaguered American fishing industry, they must justify the cost to the American taxpayer.  The enormous public debt associated with the Omnibus Funding bill is reckless and unsustainable.  Eliminating at-sea monitoring would be a good start to curtailing spending.  But in the meantime, a federal agency like NOAA cannot be allowed to create a regulatory structure and then destroy an entire industry in order to fund it.  If the government cannot afford to fund its programs, those programs must end.  For 2018, at least, the government has chosen to cover the costs of monitoring, and our fishermen will get to keep on fishing.  The better solution, however, would be to eliminate at-sea monitoring altogether.

Eric Bolinder is counsel at Cause of Action Institute

[1] CoA Institute also filed a petition with the Supreme Court, which declined to take the case.

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03/26/2018

FTC Raids Small Business and then Obscures Participation in the Raid

Update: On Thursday, March 29, 2018, after clarifying that there was no legal impediment to its production, CoA Institute received from the FMPD the unredacted body cam footage showing the raid on Vylah Tec’s offices.

On May 3, 2017, the Federal Trade Commission (“FTC”) raided a small family-run tech support company, Vylah Tec, LLC (“V-Tec”), on suspicion of “deceptive” sales practices. The hours-long raid was initiated as part of a politically-hyped campaign known as Operation Tech Trap headed by the FTC in conjunction with the Florida Attorney General’s office. The FTC’s sting-like raid, assisted by local police, included hands-in-the air orders, temporary confiscation of employee cell phones, and police-escorted bathroom breaks.

On January 4, 2018, Cause of Action Institute (“CoA Institute”), under Florida’s “Sunshine Law,” requested from the Fort Myers Police Department access to the body camera recordings taken by officers participating in the raid at V-Tec’s headquarters. In the request, CoA Institute specifically  stated that any denial of access to the requested records should be accompanied by an identification of the statutory exemption relied upon.

On March 15, 2018, two body cam recordings were produced to CoA Institute. Despite the multi-hour duration of the raid, the recordings were brief: ten minutes and eighteen minutes. The recordings showed Fort Myers police officers entering V-Tec’s offices, ordering V-Tec employees to put their hands in the air, and shepherding the employees into a small office vestibule where the employees were told they were being held until they were interviewed by unidentified people who had not yet arrived.

Curiously, although the police officers and the employees were clearly visible on the recording, several minutes into the recording, when other people entered the scene, the view immediately became obscured. Even more curiously, at times only a portion of the view is obscured so that the image of the employees is still clear, but people on the other side of the room cannot be seen – such as in the image below.

CoA Institute reached out the Fort Myers Police Department, seeking an explanation of what appeared to be redacted footage. In response, the FMPD confirmed that the footage had been redacted because they could not release the “agency” portion of the video. The Florida Sunshine law is very broad and does not include an exception to its broad disclosure requirements for images of agency personnel operating in their official capacity. It thus appears that the FMPD was instructed to deny access to body cam footage that shows the participation of those entities in the raid of V-Tec’s offices.

On March 16, 2018, CoA Institute requested that the FMPD “state in writing and with particularity the reasons for the conclusion that the record is exempt or confidential’ as required by Fla. Stat. § 119.07(1)(f)” because CoA Institute believes that the FMPD’s refusal to release an unredacted version of the footage to be improper.

Cynthia Crawford is senior counsel at Cause of Action Institute

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03/26/2018

Senators call for more transparency, support FOIA “Release to One, Release to All”

During a recent hearing on the Freedom of Information Act (“FOIA”), several senators complained about how federal agencies fail to respond to FOIA requests within the statutorily required time-frame. Senate Judiciary Committee Chairman Chuck Grassley complained that, in some cases, agencies may go more than a decade without producing documents that Americans have a legal right to access. “No one can say with a straight face that FOIA always works as intended,” he said. One step that Sen. Grassley suggested could enhance open government is the finalization of a policy known as Release to One, Release to All. This policy, which Cause of Action Institute supports, would expand access to government records by requiring agencies to post publicly online all records they’ve disclosed in response to FOIA requests. Currently, FOIA documents are only released to the individual or group who filed the request, and agencies are only required to post the records for the public if the record has been requested at least three times.

These records have already been vetted and deemed to be acceptable for public release, so there is little risk of personal or classified information becoming public knowledge though broader release. When documents are only provided to the requester, it is possible that other individuals may submit duplicate requests, which can amplify the problem of backlogs and make it harder for agencies to get information to the public. If these documents were to be released to everyone, however, journalists and watchdog groups could easily access them. Journalists could report on information while watchdog groups and think tanks could access records helpful for their work. A free flow of knowledge would help facilitate ideas to make government more efficient, which is why transparency is an essential aspect for a free and open society. Additionally, there may be unseen and unpredictable benefits that could arise from a massive increase in the amount of government information made public; last year there were more than 800,000 FOIA requests processed.

Cause of Action Institute submitted written testimony for the hearing supporting finalization of the “Release to One, Release to All” policy. CoA Institute President John Vecchione wrote:

Congress has long recognized that frequently requested records should be proactively disclosed by agencies. In the FOIA Improvement Act of 2016, Congress directed that once a record has been requested and released three times, the agency must post the record in its electronic reading room. Release to One, Release to All simply takes this idea one step further and would have agencies release information to the public after the first FOIA request and production.

When questioned by Senator Grassley on why “Release to One, Release to All” has stalled under the Trump Administration, Melanie Ann Pustay, the director of the Justice Department’s Office of Information Policy, cited compliance with Section 508 of the Rehabilitation Act of 1973. Section 508 requires that all federal agencies make public information accessible to people with disabilities, which includes people who are blind. Pustay argued this would require that these documents be accessible through audio, which would require additional time and resources. Senator Grassley was skeptical, stating, “It doesn’t meet the common-sense test.”

Expanded access to government records under “Release to One, Release to All” is an important policy. Rather than forcing every American to jump through hoops and pay substantial FOIA fees to obtain public records and duplicating work for FOIA officers, finalizing this policy would enhance the flow of information and allow Americans to use this information to benefit the public.

Tyler Arnold is a communications associate at Cause of Action Institute.

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03/22/2018

White House Directive on Congressional Oversight Requests Classified as “Presidential Record,” Not Subject to Disclosure under the FOIA

A report published earlier this month by the General Services Administration (“GSA”) Inspector General (“IG”) provides new and illuminating, as well as concerning, details about the White House’s directives to agencies for responding to congressional oversight requests from Democratic legislators and other individual members of Congress.  The IG report confirms that during the first seven months of the Trump Administration, the GSA implemented “a series of . . . unpublished policies that effectively amended” its procedures for handling congressional communications, just as the press and transparency community alleged.  The report also concludes that the GSA’s latest published guidance, which was released in July 2017, is ambiguous because it does not reflect oral policies still in force and cites to a controversial May 2017 Department of Justice Office of Legal Counsel (“OLC”) opinion that the White House has publicly rejected.  Most alarmingly, the IG report identified the underlying written basis for the GSA’s “oral” policy as a White House-created document, which is marked “presidential record” and is therefore “excluded from public disclosure under the Presidential Records Act.”

Cause of Action’s Investigation into the GSA Nondisclosure Policy

For the past year, Cause of Action Institute (“CoA Institute’) has been investigating rumors—now confirmed by the GSA IG—that the White House is directing federal agencies to ignore congressional oversight requests from Democratic legislators and individual Members who are not committee chairmen.  Various reports in the media (here and here, for example) have detailed contentious interactions between congressional staffs and employees at the GSA and the Office of Personnel Management (“OPM”).  According to some sources, White House attorney Uttam Dhillon is responsible for instructing agencies “not to cooperate” with record requests from the minority.

CoA Institute filed a Freedom of Information Act (“FOIA”) request with the GSA in an effort to verify what the Trump Administration’s actual policy might be.  We asked for records concerning the “new policy” cited by the GSA’s Acting Administrator in testimony before Congress.  We also asked the GSA for records reflecting directives or guidance originating with the White House.  When the GSA finally provided its response, it left much to be desired.  The GSA only released two documents: a February 20, 2015 order on congressional and intergovernmental inquiries, which is now obsolete, and an April 15, 2009 White House memo that CoA Institute already had made publicly known in June 2013.

We appealed that final determination, which prompted the GSA to release two additional records created during the Trump Administration.  One of those records, a copy of the agency’s “updated Agency policy,” also known as GSA Order ADM 1040.3, was remarkable.  As I discussed in a September 2017 op-ed in The Hill, although the White House had by then disavowed the OLC opinion letter as a statement of government-wide policy following harsh criticism by Senator Chuck Grassley, GSA Order ADM 1040.3, which is dated July 24, 2017, expressly cites to the OLC opinion as the GSA’s—and, presumably, the White House’s—official policy.

We then wrote to the GSA seeking public clarification, but that request went unanswered.

Our efforts to investigate OPM have been less fruitful.  Last month, the agency responded to our FOIA request by disclosing a single email linking to the OLC opinion, but without further details concerning the opinion’s implementation or continued relevance.  Our appeal challenging the adequacy of OPM’s search efforts, as well as its redaction of the responsive email, is pending.

The GSA’s Confusing Use of “Oral” Policies for Nondisclosure

The IG’s report goes into significant detail describing the evolution of the GSA’s nondisclosure policy under President Trump, but a few key findings stand out:

  • The GSA developed a series of “oral” policies that “effectively amended” the GSA’s published procedures for dealing with Congress. These policies were formulated by the agency’s Senior White House Advisor and Acting General Counsel and disseminated throughout different agency components through “small in-person meetings,” “telephone calls,” and “hallway conversations.”  This sort of official but unwritten policy development violated the GSA’s “internal policymaking directives.”
  • This “oral” policy was continually modified. In March 2017, for example, the GSA decided to permit the disclosure of publicly available information or records that would otherwise be available under the FOIA to a non-congressional requester.  At this point, the GSA’s FOIA office started to process certain requests before providing records to the congressional affairs office for final release.  These changes were based on “guidance”—presumably, written—from the White House.
  • In another instance, the GSA started to treat congressional requests under the “Seven Member Rule” as seven individual requests, thereby avoiding mandatory disclosure as required by 5 U.S.C. § 2954. This development was prompted by Ranking Member Elijah Cummings and other Democrats on the House Oversight Committee investigating the Trump Old Post Office lease.
  • Once the GSA’s FOIA office started processing congressional requests, agency employees were unsure whether the FOIA’s procedural safeguards—such as the right to file an administrative appeal—applied.
  • In one remarkable case, despite instructions from Chairman Jason Chaffetz of the House Oversight Committee to produce agency records to both the Majority and Minority staffs, the GSA intentionally neglected to do so. A senior agency advisor reported to the GSA White House Liaison and Senior White House Advisor that the “cc to [Ranking Member] Cummings” had been “take[n] off” the response to Chairman Chaffetz.
  • The IG concluded that GSA’s nondisclosure policies did not contain vital whistleblower protection language required under federal law. Although the GSA has contested the IG’s interpretation of the law and its application in this context, the agency nevertheless agreed to change its published policies to include explicit whistleblower protection language.

The “Presidential Record” Underlying the Ongoing Problem

On May 19, 2017, the White House Office of Legislative Affairs provided the GSA with some “written guidance” on congressional oversight requests.  This guidance apparently reflected the “oral” policy that had already developed at the GSA, which limited disclosures for non-chairmen to publicly available or publicly accessible records.  This policy, and the underlying White House guidance, were the basis for the GSA Acting Administrator’s testimony before Congress.  And it is this guidance that was marked as a “presidential record,” thereby removing it from access under the FOIA.

Continued Uncertainty about the GSA’s Actual Policy

According to the IG, GSA Order ADM 1040.3 is ambiguous because it does not reflect the unwritten policies that have remained in place at the GSA as late as December 2017, as reported by some officials.  Indeed, two weeks after the order’s publication, and after the White House rejected the OLC opinion, the GSA’s Acting Commissioner for Public Buildings, in testimony before Congress, reiterated the GSA’s practice of responding only to committee chairmen.  He intimated that this was “in line with the current Administration’s policy on responding to oversight questions.”

Ultimately, the lesson here is that unwritten policies, besides being bad from a transparency perspective, lead to confusion and inconsistency.  The GSA IG concluded that many high-ranking officials at the GSA never fully understood the actual policy was for responding to congressional requests.  Nor could they answer vital questions: What was the legal basis, if any, for the GSA’s policy?  What was an “oversight” request?  Were congressional members in their individual capacity really subject to the FOIA with all of the statute’s procedural safeguards?  What role did the White House have in formulating the policy?  Was it agency-specific, or indicative of a wider, government-wide policy change?

In response to the IG’s revelations, the GSA has agreed to remove any reference to the OLC opinion in Order ADM 1040.3.  But the agency still insists on qualifying its commitment to processing disclosure requests from individual members based on unidentified “longstanding agency and Executive Branch policies.”

CoA Institute will continue to investigate this matter and the extent to which “oral” policies have influenced the processing of congressional oversight requests at other agencies.  In the meantime, we have submitted a new FOIA request to the GSA, explicitly seeking the so-called “presidential records” that were the basis for the GSA’s unwritten policies.  It is not clear why the Presidential Records Act should even apply in this instance.

Ryan Mulvey is Counsel at Cause of Action Institute

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03/22/2018

Supreme Court Limits Gov’t Power to Charge Criminal Penalties for Unknowingly Obstructing the IRS

Washington, D.C. – The Supreme Court this week issued a ruling protecting all Americans from prosecution for vaguely defined tax crimes. In the case of Carlo Marinello, II v. United States, it clarified a broad statute regarding who can be charged with criminal conduct for obstructing the IRS’s administration of the tax code. Cause of Action Institute (“CoA Institute”) filed an amicus curiae brief in support of Mr. Marinello’s petition for Supreme Court review, and another one during the merits stage, urging a narrow reading of the statute to ensure no one could be charged under it without knowing that he is committing a felony.

CoA Institute President John J. Vecchione: “As Justice Breyer noted, the law Mr. Marinello was charged under could be interpreted to make felonies of routine conduct by everyday American taxpayers and business owners, such as failing to report a payment to a babysitter. Without this important decision, sloppy tax filers could be charged with obstruction with just an allegation that the conduct helped the defendant avoid tax liability. We applaud the Court for reining in such broad and potentially abusive prosecutorial authority, and Cause of Action is proud of its efforts in this result.”

Mr. Marinello owned a small courier service in New York. In 2012, the United States obtained an indictment against him under the criminal tax code, arguing that Mr. Marinello could be guilty of corruptly obstructing or impeding the administration of the tax code by performing acts as common as failing to maintain books and records for his small business, failing to provide his accountant with complete information, and discarding business records, all because he did these acts with the goal of not paying taxes.  However, the tax code already outlaws tax evasion, and it requires that the government prove a heightened criminal intent—that the defendant acted “willfully.”

During oral argument, the Court showed enormous skepticism towards the Government’s position that virtually any act or omission, no matter how slight, could subject one to felony conviction, even though the particular tax code penalties for those actions are misdemeanors. In the Court’s opinion, Justice Stephen Breyer wrote “Just because a taxpayer knows that the IRS will review her tax return every year does not transform every violation of the Tax Code into an obstruction charge.”

The full opinion can be found here.

For information regarding this press release, please contact Zachary Kurz, Director of Communications at CoA Institute: zachary.kurz@causeofaction.org.

 

 

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