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11/13/2012

Should the federal government have unchecked authority to interfere in matters of business and trade?

Should the federal government have unchecked authority to interfere in matters of business and trade at the expense of due process rights?

This question has been brought to light in Ralls Corp. v. Obama et al, a lawsuit challenging a shut-down of a Chinese-owned wind farm project in Oregon.

Cause of Action filed an amicus brief in the suit, and at the heart of our interest in this case is an American-owned green energy company called Oregon Windfarms who originally designed the “Butter Creek Projects”—a group of 4 windfarms that started development and were slated to be sold to Ralls Corporation before the government intruded. The Committee on Foreign Investment in the United States (CFIUS), an agency created originally during the Cold War era to protect the interest of American business, has exacerbated its presumed authority and intervened to stop the wind farm project. The halted deal not only harmed Ralls Corp., a privately owned Chinese company, but it also arrested an investment that started right here in the United States.

The display of power by both the President and CFIUS is disconcerting, to say the least; however, the fact that both CFIUS and President Obama are directly limiting the ability of American businesses is of much greater concern. While American businesses and workers are entitled to due process when it comes to their property, in the case of Ralls Corp. the government saw fit to ignore these rights and arbitrarily deny a company from conducting business simply because its owners are Chinese.

Further, future jobs and American businesses may be in jeopardy. This action by CFIUS and POTUS sets a less than favorable precedent for future foreign investments in an ever-shrinking global economy.

CFIUS and the President may hide behind the guise of protecting the American citizenry, but when you lift the veil of rhetoric, the long-term effects felt by the American people are much worse than allowing an American-owned business to engage with a foreign investor.

You can read our brief here.

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11/5/2012

Hatch Act Violations and the Ethics Question

Last week, Cause of Action filed a formal complaint with the Office of Special Counsel regarding remarks by Secretary of the Interior Ken Salazar during several political rallies in the swing state of Colorado. A CoA investigation determined that Sec. Salazar, was potentially violating the Hatch Act of 1939—a law designed to keep government employees from using their title and position to influence the outcome of elections.

The potential violations from Salazar come only months after another CoA investigation revealed similar circumstances at the FAA, as well as a formal finding from the OSC that Secretary of Health and Human Services Kathleen Sebelius was in violation of the Hatch Act.

The fact that so many Executive Branch employees are violating the Hatch Act must mean that something is awry.  Why does the President continue to ignore the laws that have been put in place to protect the integrity of the election system? Clearly, it is in the President’s best interest to allow his cabinet members to campaign on his behalf without recourse, but that certainly doesn’t mean it is legal.

Regardless of incentive or motivation, the President’s choices about the ethical and legal ramifications for members of his administration speak volumes. If he is unable to demonstrate integrity regarding proper punishment for law-breakers in the Executive Branch, then can he be trusted to uphold other laws?

At Cause of Action we are committed to continuing our fight for an open, honest, transparent government, and we strive to ensure that the American people get just that.

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10/26/2012

Get on the Party Bus with CTA

CTA Infographic

Cause of Action’s investigative report, “A Bus Tour of Chicago-Style Fraud,” revealed the Chicago Transit Authority (CTA) may have improperly received up to $150 million in taxpayer funds, dating as far back as 1982. Since our report was published, we now know that the Department of Transportation was aware of over-reporting by CTA, and we’ve seen a letter the Federal Transit Administration sent to CTA on April 27, 2012 instructing them to correct their 2011 data.  And new questions have emerged.

  • Why did FTA not act on Thomas Rubin’s 2007 report of this exact behavior by the CTA?
  • When did DOT Inspector General Calvin Scovel decide to investigate the matter?
  • Is there evidence to suggest that this same type of over-reporting is happening at other transit authorities around the United States?
  • Why hasn’t the FTA reported the CTA to the Department of Justice for a criminal investigation in light of their over-reporting and potential years of defrauding American taxpayers?
  • How does the President explain the Chicago connections of Robert Rivkin, Valerie Jarrett and others in light of this misuse of taxpayer dollars?

This final question highlights several ties between the Chicago Transit Authority and the Obama Administration.

  • Robert Rivkin, the current general counsel for the United States Department of Transportation, previously served as the general counsel for the Chicago Transit Authority, from 2001-2004.
  • Valerie Jarrett, the former Chair of CTA (1995-2003), now serves as a senior advisor for public engagement and intergovernmental affairs in the Obama administration.
  • Forrest Claypool, the current President of the CTA was appointed to the position by Rahm Emanuel, former chief of staff for the 44th president and current mayor of Chicago. Before coming to CTA, Claypool served as a member of Obama’s media team in 2008.
  • Shelia Nix, former CTA board member (and also a former aide to Rod Blagojevich), now serves as Vice President Biden’s chief of staff.

Cause of Action thinks that these connections raise questions about the nature of the relationship between Washington and CTA, especially given how reluctant the FTA was to investigate allegations of over-reporting that were raised as early as 2007.

 

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10/23/2012

Bloomberg story proves Cause of Action’s investigation right on the money

Last week, Cause of Action released a report called, “A Bus Tour of Chicago Style Fraud.” It turns out that our suspicions were correct. As Bloomberg News reports today , the U.S. Transportation Department knew that “…[the] Chicago Transit Authority collected more federal aid than it should have after inflating mileage covered by its bus routes.”

The Federal Transit Administration, part of the U.S. Dept. of Transportation, not only knew of the over-reporting by CTA, but it seemingly ignored evidence of it for years because, as our report outlines, a 2007 audit showed that something was awry with the way CTA was reporting their mileage.

Instead, the USDOT chose to wait until this year to instruct CTA to change its behavior moving forward, as highlighted in an April 27, 2012 letter that FTA sent to CTA.

“FTA’s letter highlights two very important facts,” said Cause of Action’s Executive Director Dan Epstein. “First, CTA was, as Cause of Action suspected, violating the reporting manual used to calculate VRM, thereby improperly receiving federal grant money. But secondly, FTA is revealing that it had knowledge of overreporting occurring, and by conducting a review of only 2011, it ignored the 2007 report presented by auditor Thomas Rubin that showed the same potential actions happening in fiscal year 2006.”

So the question of why an investigation didn’t happen until 2011 despite clear evidence that it should have happened sooner remains unanswered by the FTA.

“It appears an explanation for why FTA limited its review to one year, and failed to disclose its findings to Cause of Action following our expedited FOIA request, is that there is clearly a politically motivated cover-up happening at the Department of Transportation” said Epstein.

Cause of Action’s investigation into the poor stewardship of tax dollars only further raises the spectre of corruption at the same agency where Cause of Action revealed two top officials who violated the Hatch Act, Epstein said.

“Just as no punishment occurred when Kathleen Sebelius violated the Hatch Act, no punishment will occur with a CTA that defrauded the American taxpayers. Cause of Action exists to fight this kind of corruption and show the American taxpayers exactly what is happening to their money in the hands of corrupt politicians,” concludes Epstein.

In the coming days, Cause of Action hopes to be able to answer these questions on behalf of taxpayers of the United States.

  1. When did DOT Inspector General Calvin Scovel decide to investigate the matter?
  2. Is there evidence to suggest that this same type of overreporting is happening at other transit authorities around the United States?
  3. Why hasn’t the FTA reported the CTA to the Department of Justice for a criminal investigation in light of their overreporting and potential years of defrauding American taxpayers?
  4. How does the President explain the Chicago connections of Secretary LaHood, Robert Rivkin, Valerie Jarret and himself in light of this misuse of taxpayer dollars?
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10/22/2012

An update about Drakes Bay Oyster Company

Over the past few months, Cause of Action has been working to make sure the Lunnys, a family who runs Drakes Bay Oyster Company (DBOC), are able to keep their oyster business open. With less than 45 days until the deadline for a decision, there are several updates on this important issue.

Recently, Cause of Action submitted a response to the National Park Service to have the information contained in their reports accurately reflect the situation at the Lunnys’ environmentally responsible, sustainable oyster farm in Point Reyes National Park.

The Lunnys’ struggle against the National Park Service has also caught the attention of the California state Fish and Game commission, who recently sent a letter of support for the Lunnys to the National Park Service.

On November 30, 2012 the Lunnys’ permit to lease land from The National Park Service will expire. Before that date, NPS is required to issue a final report assessing the scientific findings concerning DBOC’s effect on Drakes Bay. We hope that the NPS uses credible data when they make a decision that will affect the livelihood of not just the Lunnys, but their employees, and the community as well.

 

As of May 24, 2013, Cause of Action no longer represents Drakes Bay Oyster Company, the Lunny family, or Dr. Corey Goodman and will be withdrawing as counsel from the litigation.

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10/4/2012

CoA Letter Concerning Upcoming National Park Service Response

Today Cause of Action sent a letter to numerous members of Congress alerting them to the upcoming October 8 response due from the National Park Service to a Data Quality Act complaint that was filed on behalf of Drakes Bay Oyster Company and Dr. Corey Goodman.

 

See our letter here:

121004 Letter Re DQA Complaint

 

As of May 24, 2013, Cause of Action no longer represents Drakes Bay Oyster Company, the Lunny family, or Dr. Corey Goodman and will be withdrawing as counsel from the litigation.

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09/5/2012

FAA Hatch Act Investigation Exhibits

 

Cause of Action released documents today revealing a potential Hatch Act violation at the Federal Aviation Administration (FAA) involving John J. Hickey, deputy associate administrator for aviation safety at the FAA, and Raymond Towles, deputy director of flight standards field operations. At a May 23, 2012 staff meeting, Hickey told subordinates that “if the Republicans win office [their] jobs may be effected [sic]…if the Democrats win office then [their] jobs would not be effected [sic].” Additionally, Hickey and Towles held mandatory meetings with employees at other regional FAA offices, where similar comments may have been repeated.
 
In light of these allegations, Cause of Action sent a request for investigation to Inspector General at the U.S. Department of Transportation Calvin L. Scovel III, urging “a swift investigation, not only into whether the comments made by Mr. Hickey and Mr. Towles at the Seattle FSDO violated the Hatch Act, but also whether their comments violated any other federal laws, as well as if they engaged in any other activities in violation of the Hatch Act or other applicable law.”

 

The documents related to this investigation:

Exhibit 1 (2)

Exhibit 2 2_Redacted

Exhibit 3 1_Redacted

 

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