close X
07/13/2017

CoAI to President Trump: Appoint Commissioners to FTC

Letter urges swift action to break deadlock, free U.S. businesses from unwarranted, abusive enforcement actions

Washington, D.C. – Cause of Action Institute (“CoA Institute”) sent a letter to President Trump, imploring him to move quickly to appoint one or more commissioners to fill current vacancies at the Federal Trade Commission (“FTC”). The letter suggests that just one additional commissioner could break deadlock to halt the agency’s pattern and practice of regulatory overreach and rein in recent unconstitutional enforcement actions that harm the economy and the rule of law.

The letter states that although the FTC’s acting chair, Maureen Ohlhausen, “has done a commendable job of addressing the excesses and lawlessness that plagued the agency, the acting chair cannot fully right the ship unless and until you appoint one or more commissioners who share her commitment to advancing economic liberty and believe that responsible businesses should have the freedom to succeed, unfettered by rogue regulators chasing chimerical harms.”

The letter states:

“The acting chair’s ability to promote competition and protect the free market and consumers from overregulation and overreach is hamstrung by the current gridlock on the Commission. Although Congress intended for the Commission to be an independent, bipartisan, five-member administrative body, there are currently only two commissioners: Acting Chair Ohlhausen, a Republican, and Commissioner Terrell McSweeney, a Democrat.

“Because a majority of commissioners must vote to approve most Commission actions, and because only one of the two current commissioners shares the administration’s commitment to cutting bureaucratic red tape to grow the economy, the Commission is hopelessly deadlocked on important policy issues affecting the entire private economy, such as the FTC’s controversial efforts to regulate data security, technology, and privacy for all U.S. businesses citing its authority under Section 5 of the FTC Act to prohibit ‘unfair’ or ‘deceptive’ business practices.”

The letter highlights several controversial “midnight” enforcement actions initiated just before the Trump administration began, that were undertaken in the absence of proven consumer harm. For instance, as the acting chair explained in her dissent from one such “midnight” enforcement action:

“[I]n the Commission’s 2-1 decision to sue Qualcomm, I face an extraordinary situation: an enforcement action based on a flawed legal theory (including a standalone Section 5 count) that lacks economic and evidentiary support, that was brought on the eve of a new presidential administration, and that, by its mere issuance, will undermine U.S. intellectual property rights in Asia and worldwide. These extreme circumstances compel me to voice my objections.”

The letter concludes, “[T]he acting chair should not be the lone (and thus powerless) voice of reason and sound economic policy on the Commission. For these reasons, we respectfully ask that you expeditiously appoint one or more Commissioners to the FTC at your earliest convenience to assist the Acting Chair in furtherance of this Administration’s efforts to reduce regulatory burdens and improve Americans’ liberty to create.”

The letter was signed by John J. Vecchione, president and CEO of CoA Institute. The full letter is available here

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

Media, Press Release Learn More
07/13/2017

CoAI Seeks Supreme Court Review of Job-Killing Fishing Regulation

High Court may be last hope to halt regulation that will put 60 percent of New England ground fishermen out of business

Washington, D.C. – Cause of Action Institute (“CoA Institute”) has filed a petition for writ of certiorari urging the U.S. Supreme Court to review the legal arguments of our clients, groundfisherman David Goethel and a group of Northeast fishermen, who sued the U.S. Department of Commerce after the agency shifted the costs for at-sea monitors onto industry. At more than $700 per day at sea, these costs are more than double what many small-boat fishermen take home from an average day of fishing.

Both the U.S. District Court for New Hampshire and the First Circuit Court of Appeals dismissed the case, ruling that the fishermen’s suit was untimely based on when the rule was first disseminated, even though the regulatory costs were not shifted to industry until several years later.

CoA Institute Vice President Julie Smith: “Our clients deserve an opportunity to be heard on the merits. Fishermen who have done nothing wrong should not be put out of business by an unlawful regulation.”

The petition states:

“The First Circuit, in defiance of this Court’s precedents, refused to reach the merits of the fishermen’s challenge, holding that even though the fishermen would certainly face enforcement action for failure to comply with the Government’s unlawful monitoring requirement, they missed any opportunity to seek preenforcement review of that regulation. By requiring Petitioners to, quite literally, ‘bet the boat,’ the First Circuit has committed clear error in ignoring this Court’s precedents on pre-enforcement review…

“Here, the Government waited five years before deciding to implement the industry-funding requirement for the groundfish At-Sea Monitoring Program. Petitioners promptly filed suit, but, so far, have been denied a decision on the merits of their case. This Court should grant review to settle these . . . important questions of law and vindicate its own precedents, which will give the New England fishing industry a second chance at life.”

David Goethel: “After 30 years of fishing, I can’t afford to fish any longer if I’m forced to pay for at-sea monitors. These regulatory costs will devastate small boat fishermen like myself. The Supreme Court may be our last hope to save an industry that for centuries has provided a living for fishermen in New England.”

Northeast Fishery Sector 13 Manager John Haran: “The fishermen in my sector can’t sustain this industry funding requirement and many will be put out of business if this mandate remains in place. The livelihoods of generations of proud fishermen in New England are at stake.”

Case Background:

In November 2015, the Department of Commerce finally announced the date by which sector fishermen, who fish for cod, flounder and certain other ground fish, must not only carry third-party contractors known as “at-sea monitors” on their vessels during fishing trips, but also pay out-of-pocket for the cost of those monitors.  CoA Institute’s clients filed suit to challenge this “industry funding” requirement, which will devastate the Northeast fishing industry, at the price of many jobs and family livelihoods.

In July 2016, the U.S. District Court for the District of New Hampshire dismissed the lawsuit. CoA Institute appealed the decision and in April 2017, the First Circuit Court of Appeals upheld the District Court’s ruling, but without addressing the merits of the case. The Circuit Court held that the fishermen’s suit was untimely, and must have been filed within thirty days of the original agency rule that mandated industry-funding, despite the fact that the requirement never enforced for nearly half a decade.  Interestingly, while the First Circuit did not address the merits of the case, it did emphasize the devastating economic impacts of the regulation and, in a rare move, urged congressional action to clarify the law regarding who should pay for the at-sea monitors.

To learn more, visit the Cause of Action Institute website.

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

Media, Press Release Learn More
07/6/2017

CoAI Sues NOAA for G-Chat Records Surrounding Controversial Amendment to Expand Industry-Funded At-Sea Monitoring

Unlawful agency directive appears to greenlight concealed communications on internal messaging platform

Washington D.C. –Cause of Action Institute (“CoA Institute”) today filed a lawsuit against the National Oceanic and Atmospheric Administration (“NOAA”) for Google Chat or Hangouts communications from the New England Fishery Management Council’s (“NEFMC”) April 2017 meeting. The suit also seeks internal guidance on retention of Google Chat records on the agency’s internal messaging platform. NOAA failed to respond to two Freedom of Information Act (“FOIA”) requests submitted in May for these records.

The records sought by CoA Institute include guidance from NOAA’s Office of General Counsel for the retention of instant messages through the “Google Chat” or “Google Hangouts” feature of NOAA’s internal Unified Messaging System. According to a March 2012 NOAA handbook, employees were instructed that these messages “will be considered ‘off the record’ and will not be recorded in anyway.”

CoA Institute Vice President Julie Smith: “NOAA appears to have created an internal messaging platform to hide records from public disclosure. Any directive to make certain communications be considered ‘off-the-record’ clearly violates transparency laws.  Americans have a right to know how decisions are made that could jeopardize their livelihoods.”

The lawsuit also seeks all communications sent or received by employees of NOAA’s NEFMC who attended the April 18–20, 2017 meeting. During this meeting, the NEFMC approved a controversial amendment to expand the use of industry-funded at-sea monitors to the herring fishery and to prepare for its further expansion through all regional fisheries.

CoA Institute submitted a regulatory comment opposing the so-called Industry-Funded Monitoring Omnibus Amendment due to negative economic impacts that threaten the livelihoods of countless small-business fishermen. The cost for a monitor under the amendment would cost fishermen more than $700 per day at sea.  That would exceed the revenue a fisherman typically lands from his daily catch. The Secretary of Commerce has since commenced a review of the rule for compliance with federal law.

The full complaint is available here.
The two earlier FOIA requests are available here and here.

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

 

Media, Press Release Learn More
06/26/2017

FBI “Can Neither Confirm Nor Deny” Existence of Records About Payment to Trump Dossier Researcher

Washington D.C. – The Federal Bureau of Investigation (“FBI”) has declined to confirm the existence of records responsive to a lawsuit filed by Cause of Action Institute (“CoA Institute”) in April 2017 for records about the relationship between the agency and  Trump dossier researcher Christopher Steele, a former British spy who made headlines after he was identified as the lead author of the infamous dossier.

According to a news report, the Trump dossier researcher entered an agreement with the FBI a few weeks before the November 2016 election to investigate then-candidate Donald Trump while, at the same time, he was employed by an opposition research firm to collect information for Democratic presidential nominee Hillary Clinton.

In part, the FBI’s response states:

“The nature of your request implicates records the FBI may or may not compile pursuant to its national security and foreign intelligence functions. Accordingly, the FBI cannot confirm or deny the existence of any records responsive to your request, as the mere acknowledgment of the existence or nonexistence of such records would, in and of itself, harm national security interests and reveal intelligence sources and methods.”

This so-called Glomar response gained notoriety in the CIA’s use of the Glomar Explorer to recover a downed Soviet submarine.

CoA Institute President and CEO John Vecchione: “The FBI is circling the wagons by claiming potential harm to national security if it discloses its relationship with Christopher Steele. Regardless of whether a payment was ever made, the FBI’s affiliation with a political opposition researcher in the midst of a presidential election deserves scrutiny. The FBI should be forthcoming about whether and how the agency was relying upon a former foreign spy who, in the pay of private parties, compiled a report of salacious accusations intended to harm the reputation of then-candidate Donald Trump.”

On March 7, 2017, CoA Institute sent a FOIA request to the FBI seeking access to records into whether the FBI paid money, or had plans to pay, Mr. Steele for any purpose.

The FBI’s full response can be found here.

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

Media, Press Release Learn More
06/19/2017

White House Should Release 100K Public Comments on Reforming Government

Washington, D.C. – Cause of Action Institute (“CoA Institute”) today submitted a Freedom of Information Act (“FOIA”) request to the White House Office of Management and Budget (“OMB”) seeking access to the more than 100,000 public comments OMB collected regarding “improvements to the organization and functioning of the Executive Branch.”

Between May and June, 2017, Americans were invited to submit suggestions to OMB in response to President Trump’s March 13 executive order calling for a comprehensive plan to reorganize the Executive Branch. The comments, however, have not been made publicly available.

CoA Institute President and CEO John Vecchione: “Public input can be a fundamental component of government reform, but there is little reason to sacrifice transparency. Given that President Trump’s executive order calls for the possible overhaul of the entire Executive Branch, the need for transparency and open public scrutiny of this matter is paramount.”

In addition to the regulations.gov website, which is routinely used by the federal government for gathering public comments, OMB also collected comments via an online form housed on a White House website. There appears to be a discrepancy between the reported number of comments and suggestions submitted via the reorganizing website, which states that “100,000+ suggestions and ideas” were submitted, and regulations.gov, which states that only 2,019 comments were received.

CoA Institute today requested access to all comments, suggestions, and ideas submitted to the OMB as part of this effort. The FOIA request is available here.

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

Media, Press Release Learn More
06/1/2017

Pruitt Should Reconsider Obama-Era Settlement with Harley-Davidson That Funnels Millions to an Unrelated, Politically-Favored Project

Washington, D.C. – Cause of Action Institute (CoA Institute) today sent a letter to EPA Administrator Scott Pruitt urging him to reconsider an Obama-era settlement reached with Harley-Davidson, Inc. for selling after-market “super tuner” devices to boost performance of their motorcycles. The EPA alleged these devices were sold in violation of the Clean Air Act. Without admitting liability, Harley-Davidson agreed to settle the lawsuit.

The settlement included a controversial requirement that Harley-Davidson fund a seemingly unrelated program to replace or retrofit wood-burning stoves with cleaner appliances, which appears to violate the agency’s own guidance on the issuance of consent decrees.

CoA Institute also issued a separate Freedom of Information Act (“FOIA”) request to the EPA for documents related to the settlement negotiations.

CoA Institute President and CEO John Vecchione: “EPA is erring by not implementing a mitigation project by Harley-Davidson that fits the violation as required by applicable rules. The Obama administration’s pattern of using settlements to fund favored political projects is a dangerous precedent that should be reviewed and reversed. Funneling settlement funds to pet projects should not supplant the congressional appropriations process or applicable rules that mitigation projects address the underlying harm caused.”

Unlike the defeat devices unknowingly installed in Volkswagen vehicles, the Harley-Davidson “defeat devices” were freely and intentionally purchased by individuals, and came with labels that detailed what “performance enhancements are considered street legal and for competition-use only” and warned against improperly using the devices. Harley-Davidson maintains that these products, which have been sold for over two decades, “[were] and [are] legal to use in race conditions in the U.S.”

The “Emissions Mitigation Project” included in the consent decree requires Harley-Davidson to fund a “wood-burning appliance changeout and retrofit.” The project is defined as a “supplemental environmental project” (“SEP”). However, in 2015, the EPA issued a guidance document outlining the legal requirements enforcement officials must adhere to when crafting an SEP.  The Harley-Davidson consent decree violates EPA’s guidance on SEPs by not establishing a sufficient nexus between the mitigation project and the alleged underlying violations.

In its letter, CoA Institute urges EPA Administrator Pruitt to reconsider the Harley-Davidson consent decree’s unlawful Emissions Mitigation Project, and replace it with a project that conforms to the SEP Policy’s sufficient nexus requirement.

The letter to Administrator Pruitt is available here The FOIA request is available here

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

Media, Press Release Learn More
05/19/2017

Court of Appeals Rules Vehicle Tech Company Has Right to Pursue Relief After Unfair Treatment by DOE on Renewable Loans

Washington, D.C. – The U.S. Court of Appeals for the District of Columbia today reversed the District Court’s ruling, siding with Cause of Action Institute’s (CoA Institute) client, Limnia Inc., an advanced vehicle technology company that alleged it was unfairly passed over for a government-backed loan and loan guarantee through the Department of Energy’s (“DOE”) politically-driven  programs.

CoA Institute President and CEO John Vecchione: “We are very gratified for the Court’s decision. The Circuit saw things our client’s way. We look forward to further advancing this case upon remand. But this is an important precedent laying out the parameters of voluntary remand to an agency.”

CoA Institute filed a lawsuit in 2013 on behalf of Limnia Inc. after the Department of Energy (“DOE”) failed to give the company fair treatment and the honest opportunity to compete for a government-backed loan under the agency’s controversial loan guarantee program to build advanced technology vehicles and components.

In 2008 and 2009, Limnia submitted two loan applications for $15 million in funding through DOE’s Advanced Technology Vehicles Manufacturing (“ATVM”) program. Limnia specializes in the production of battery systems for electric cars and applied for funding to develop a new advanced vehicle energy storage system. The DOE rejected both of Limnia’s applications.

Limnia sued DOE in the District Court alleging that the rejection of its applications was unlawful under the Administrative Procedure Act. In its complaint, Limnia argued it was passed over in favor of politically-favored competitors, such as Tesla Motors Inc., which had close connections to the Obama administration. Tesla received hundreds of millions in loans from the ATVM in early 2010.

Before the District Court could decide Limnia’s case on the merits, however, DOE requested that the case be remanded back to the agency. The District Court granted DOE’s request, returning Limnia’s case to the agency and closing Limnia’s judicial action. In today’s opinion, the Court of Appeals found that the District Court’s decision functioned as a dismissal of Limnia’s claims and authorized further judicial proceedings.

Limnia Inc. Chairman and Vice President of Product Innovation Scott Douglas Redmond: “We fought this fight on behalf of everyone who is sick of cronyism and corruption in Washington DC and tired of having their tax dollars used against them by corrupt political insiders. This is part one of a victory, not only for our team, but for the average citizen who doesn’t want their tax dollars going to politically connected projects.”

The full opinion is available here
Visit our blog for analysis of the opinion and more information about the case here

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

Media, Press Release Learn More