Search Results for: IRS

Weekly Rundown 11-13-2015

Cause of Action in the News:

Franchise Action NetworkDEPARTMENT OF LABOR TAKES AIM AT FRANCHISE SMALL BUSINESS

Earlier this month, Cause of Action argued on behalf of entrepreneur Rhea Lana in Rhea Lana v. U.S. Department of Labor before the D.C. Circuit. The Franchise Action Network wrote “Rhea Lana is faced with a Hobson’s choice; either continue running her businesses and face significant potential monetary penalties or cease operating as she has for years even though she has done nothing wrong.”  Cause of Action will continue to fight for people like Rhea Lana and continue to call for government transparency.

In Other News:

ForbesAmazingly, IRS Says You Can’t Rely On IRS Instructions

If you thought following IRS instructions to complete your taxes was a safe bet, think again. As it turns out, the agency can penalize good-intentioned taxpayers who follow those instructions as courts have held them to be non-authoritative.  There have been many instances of regular Americans losing to the IRS although they tried to do everything right. This kind of behavior would never be tolerated in the private sector and demonstrates an egregious double standard for federal agencies.

Fox NewsFBI expands probe of Clinton emails, launches independent classification

Former Secretary of State Hillary Clinton’s emails are under heightened IRS scrutiny as investigators seek to find evidence of False Claims Act violations.  You may recall, Martha Stewart famously graced West Virginia’s Alderson Federal Prison Camp in 2004 after conviction under the same statute.  Former FBI intelligence officer Timothy Gill said “[t]his is a broad, brush statute that punishes individuals who are not direct and fulsome in their answers.”

Fox NewsStudy claims EPA’s Clean Power Plan may hike electricity prices in 47 states

Boston-based firm NERA Economic Consulting has concluded the EPA’s Clean Power Plan will cost around $292 billion, leading to increased electricity bills in 47 states. Laura Sheehan, Senior Vice President of Communications at the American Coalition for Clean Coal Electricity, noted “[S]tates should be braced to pay higher costs,” and “[c]onsumers only lose in the Clean Power Plan.”  The EPA rejects these results, while curiously maintaining the agency has not even reviewed the report.

AllGovMost U.S. Agencies Fail to Conduct Required Reviews of Federal Regulations

In 2011, President Obama required federal agencies to review the regulations they created by issuing executive orders to clean up rules “that may be outmoded, ineffective, insufficient, or excessively burdensome, and to modify, streamline, expand, or repeal them in accordance with what has been learned.”  However, a recent study reports that of the 2,400 to 4,500 new regulations promulgated annually, very few are ever reviewed.  The Regulatory Studies Center at George Washington University examined 22 rules that “had an effect of $100 million or more on productivity, jobs, competition, the environment, public health and safety or local governments,” and concluded the government has no plans in place to review them, arguably violating executive directives.

Washington TimesPunishing the Obama way (The president’s enforcers are treating ordinary Americans like enemies)

The Department of Justice has let Lois Lerner off the hook, concluding there was no evidence of Tea Party targeting.  James Clapper, Director of National Intelligence, abandoned his inspector general and opined that Hillary Clinton’s use of a private server for government business was above-board.  These are just a few examples of why it is imperative to fight for a transparent government that demands the same compliance from its officials as it does from the American public.

Weekly Rundown 11-6-2015

Cause of Action in the News:

Full MeasureFull Measure with Sharyl Attkisson

In the fight for government transparency, Cause of Action graded federal agencies on their transparency and response time to FOIA requests. Not surprisingly, many agencies earned very poor grades while two received A’s. Interestingly, the Department of Veterans Affairs scored an A, despite public exposure of the agency’s notorious wait-time scandal the same year. Cause of Action Executive Director Dan Epstein opined, “if you think about it, part of the reason the public knows about the VA scandal is because of the easy ability to get documents. That should show why transparency is actually a good thing for reforming federal agencies.”

Wall Street JournalFranz Kafka in Footie Pajamas (My consignment company for secondhand children’s clothes has somehow run afoul of federal regulators.)

Meet Cause of Action client Rhea Lana Riner, a business woman who started a small and successful consignment business in 1997 that now has franchises in 24 states. Rhea Lana relies heavily on volunteers who are willing to help before and during the events who then get rewarded with perks such as being able to shop first. The Department of Labor decided that her volunteers must actually be considered employees and that she owes them back wages. Even though none of the volunteers have come forward demanding payment for their volunteer hours, the Dept. of Labor continues to try to obstruct Rhea Lana’s business.

In Other News:

Government ExecInspectors General Continue Battle With Justice Over Document Access

The Justice Department has written to Congress that there should be a change in the law that would allow federal agencies to deny access to certain information by inspectors general. They write this as congress holds hearings on a bill that would empower the inspectors general to do their job. The IGs responded saying “While the DOJ agrees with CIGIE that legislation is needed and should be passed by Congress to reverse the impact of the OLC opinion, the DOJ’s proposal only applies to the DOJ Inspector General’s access to records and fails to ensure that all other federal inspectors general have the same independent access at their respective agencies. As such, DOJ’s proposed legislative language is not acceptable.”

PoliticoState Dept.: Outlook crashes delay release of Hillary Clinton schedules

The State Department has been unable to meet the deadline for turning over former Secretary of State Hillary Clinton’s emails due to multiple Microsoft Outlook crashes.  Kelly Degnan, the State Deputy Executive Secretary, wrote a declaration that stated, “[t]hroughout August and the early part of September, problems with the Microsoft Outlook software caused Outlook to crash during the indexing process (a process that is necessary in order to conduct searches of emails which have been retained as .pst files) for searches [State’s executive secretariat within the office of the secretary] was running for other requests, preventing S/ES-S from applying search terms to the records and forcing S/ES-S to restart the indexing process[.]”

Daily CallerEPA’s Smog Regulation Will Cost 40x More Than It Predicted

A new report by the American Action Forum says the Environmental Protection Agency estimate on the cost of the new smog limits is highly inaccurate.  According to the EPA, the new limits will cost $1.4 billion per year; however, AAF has determined the American people will be losing $56.5 billion in income. The report, which looked at counties who were not compliant with the 2008 standard, explains “[o]bserved nonattainment counties experienced losses of $56.5 billion in total wage earnings, $690 in pay per worker, and 242,000 jobs between 2008 and 2013.”  With so many penalties for noncompliance with the 2008 smog standard, it makes sense that the new standards will have an even harsher impact.

SF GateFeinstein calls for end to controversial EB-5 immigration program

The EB-5 visa program gives out green cards to foreign nationals and their families if they invest into U.S. businesses.  Without Congressional action, the program is set to expire in December.  One of the strongest opponents is Senator Diane Feinstein, who noted “[a]t its most basic, the EB-5 program allows a foreigner to invest $500,000 in a U.S. business, in return receive a visa that puts them and their direct family on a special path toward citizenship.  At the same time, individuals unable to buy their way into the country remain trapped in seemingly endless visa backlogs that often last more than 20 years. I believe the program is deeply unfair, sends the wrong message about this country’s values and is prone to fraud and abuse.”

We Were In Federal Court Today on Behalf of Our Client, Rhea Lana Riner. Here’s What We Argued

Today, Cause of Action presented oral argument before the U.S. Court of Appeals for the D.C. Circuit in the case of Rhea Lana, Inc. v. Department of Labor (Case No. 15-5014).

Rhea Lana is an organizer of children’s clothing consignment events; it was founded by a stay-at-home mother in Conway, Arkansas and has since expanded into a franchise with 80 locations in 24 states. In Rhea Lana’s business model – consistent with other businesses in the consignment industry – consignors provide items to be sold, and have the option of “volunteering” at the sales event. Participating in the sale in that way helps ensure that consigned items sell, and consignors who choose to do so have the opportunity to shop early in order to get the best deals. What Rhea Lana provides is the organization, branding, and technology to help consignors make their sales.

Notwithstanding the obvious benefits of this arrangement for all concerned, the Department of Labor sent Rhea Lana a letter determining that the model violates the Fair Labor Standards Act (FLSA): specifically, that the participating consignors are actually Rhea Lana employees entitled to minimum wage and overtime. Although the agency did not initiate an enforcement action, it encouraged Rhea Lana’s consignors to sue for back wages (none did) and threatened Rhea Lana with civil monetary penalties if Rhea Lana doesn’t conform to the agency’s views. Rhea Lana filed suit under the APA seeking injunctive and declaratory relief, but to make matters worse, the district court dismissed the complaint for lack of any reviewable “final agency action.”

On appeal, Cause of Action has argued that the Department of Labor’s decision is indeed final and reviewable. First, the agency’s decision changes Rhea Lana’s legal status. In order to extract civil monetary penalties from Rhea Lana in a future enforcement action, the agency must prove that Rhea Lana either (1) is a repeat FLSA offender, or (2) violated the statute willfully.  See 29 CFR 578.3. Under the text of the agency’s regulations, notice from the agency has an important legal role in satisfying those requirements. Notice from the agency is an element of repeatedness, which the letter facially appears to satisfy.  Furthermore, notice will allow the agency to argue that Rhea Lana acted willfully not just factually, but as a matter of law. By sending Rhea Lana a letter, the agency thus created legal liabilities that wouldn’t have existed otherwise – one of the hallmarks of reviewable agency action. See, e.g.Sackett v. EPA, 132 S. Ct. 1367 (2013). Second, as the Supreme Court also recently reaffirmed in Sackett, when an agency demands a party’s compliance, the party can go to court instead of waiting for the hammer of enforcement to drop.

We await the Court of Appeals’ decision. If we are successful, the case will return to the district court for consideration on the merits of Rhea Lana’s claim that the Fair Labor Standards Act allows businesses and individuals to collaborate for their mutual benefit.

Weekly Rundown 10-30-2015

Cause of Action in the News:

Daily CallerThe Daily Caller Sues The State Department For A Variety Of Clinton Email Records

Cause of Action is representing The Daily Caller in a lawsuit over five Freedom of Information Act requests that have gone ignored by the State Department.  Our suit states “Defendant has dragged its feet, refused to provide substantive updates on the status of the requests, and, through its delay, prevented Plaintiff’s access to the requested records and effectively denied it expedited processing,”

“The material being sought here is not complicated to understand yet, for whatever reason the State Department has failed to process these FOIA requests in a timely manner, as required by law.  Whether requests have come from big news agencies or organizations like mine, this State Department has repeatedly shown an inability to produce basic information regarding the emails belonging to the former Secretary of State,” said Cause of Action Executive Director Dan Epstein.

In Other News:

Watchdog.orgDouble-dose of EPA regulations will make your bank account scream

According to a white paper by the Independence Institute the Environmental Protection Agency’s Clean Power Plan will be billions higher in cost for power and gas.  The research concluded that by 2020 the cost of electricity and gas in a given household will go up an average of $680.00.  All of this cost will result in no environmental change, as admitted by Gina McCarthy, current EPA administrator.

Daily SignalLois Lerner Won’t Be Facing Criminal Charges. Here Are the Problems With the ‘Investigation’ That Cleared Her.

Although the Department of Justice has decided to end its investigation into Lois Lerner and her email scandal they have failed to erase all doubt.  In the letter the DOJ sent to the House of Representatives they explain the results of their investigation, but fail to determine criteria for which organizations needed closer watching, among other unresolved issues.

The HillFive states sue over EPA’s ozone

The Environmental Protection Agency is being sued by five states because of the newly stated ozone limits. EPA administrator Gina McCarthy has said that every state but California should be able to comply to the new ozone standards by 2025.  However, Arizona Attorney General Mark Brnovich says that “reducing the ozone standards to 70 parts per billion will be nearly impossible for Arizona to attain.” AG Brnovich is leading the charge in the lawsuits against the EPA.

BreitbartHILLARY CLINTON CHANGES DEFINITION OF ‘WORK-RELATED EMAIL’

Statements made by former Secretary of State Hillary Clinton have led to questions of what her definition of a work related email is. Mrs. Clinton said “Well, if you are talking about Mr. Blumenthal, which I assume you are, he had some that I didn’t have, and I had some that he didn’t have. And he — I was under no obligation to make any of his emails available unless I decided they were work-related.”  This seems to contradict a previous statement from Mrs. Clinton where she said she had turned over all emails “that could possibly have been work related,” which should include any emails from an advisor personal friend or not.

ForbesIRS Joins FBI, DEA & Other Federal Agencies With Access To Cellphone Surveillance Technology

For years now the IRS has had in its possession a Stingray, a device that can capture cell phone data such as location and identifying information without needing a warrant.  A recent Freedom of Information Act request revealed an invoice of $70,000 for the purchase of a HailStorm, a more powerful Stingray, and training for its use.  The IRS has not explained how they utilize the device and now make a list with 12 other federal agencies who own such technology.

White House’s “Open Government National Action Plan” Misses The Mark

The Obama administration on Tuesday published its Third Open Government National Action Plan to increase transparency and provide citizens with “unprecedented access” to government information. While this plan contains laudable sections to improve access to information through the Freedom of Information Act and to increase federal spending transparency, it neglects to identify and address two fundamental issues clouding this administration’s record on transparency.

This administration has demanded government agencies seek counsel from the White House on any matter that could be considered a “White House equity.” This policy threatens both the improvement of FOIA request transparency, and the public’s First Amendment rights.

The definition of “White House equities” is nebulous at best; most agencies are unsure exactly what the term means, although some have understood it to be anything of possible interest to the White House. This vague definition has caused confusion — and therefore delays — from many government agencies in processing FOIA requests, leaving the public waiting on information. Additionally, adding the White House onto the review process not only increases delays, but it actually provides the White House Counsel’s Office with documents it would not ordinarily have access to under FOIA.

White House equities are in clear conflict with government transparency, and should have been addressed in the National Action Plan.

In addition, the administration’s plan fails to address Executive Branch Earmarks.

In 2008, President Bush issued Executive Order 13457, aimed at ensuring that funds provided by Congress are transparent and merit-based, with all information made publicly available on the internet. However, the Executive Branch is currently ignoring Executive Order 13457 and still handing out its own earmarks behind closed doors.

Taxpayer dollars continue to be wasted in the absence of government transparency. A Cause of Action examination of federal discretionary spending through FOIA records and federal databases has revealed that efforts to ensure that discretionary grant decision-making is transparent and merit-based are ineffective. As a result, political appointees and others continue to use federal monies to reward political allies and appease powerful interests.

While the administration may have a plan to make government more transparent, there is a great deal that it has neglected. If the administration really wants to increase transparency, then it must address White House equities and Executive Branch Earmarks.

Weekly Rundown 10-23-2015

Cause of Action in the News:

Wall Street JournalThe Latest Progressive Attack on Speech (Still infuriated by the Citizens United ruling, the left keeps trying to undo that blow for freedom.)

Cause of Action Executive Director Dan Epstein wrote about Van Hollen v. FEC which is currently being heard by the D.C. Court of Appeals.  Maryland Representative Chris Van Hollen is arguing that nonprofit organizations should be required to reveal all donors, not just those that donating for an election.  Mr. Epstein writes “If the court forces nonprofits to disclose the identity of their supporters, it will lead to the “threats, harassment, or reprisal” that chill free speech and limit free association, just as the Supreme Court has warned.”

Delaware OnlineBloom rival settles with state over fuel cells

A settlement was reached that will now allow out-of-state fuel cell manufacturers to compete in Delaware.  Dan Epstein, Cause of Action Executive Director, had this to say about the ruling: “This settlement should send a message to government officials that fair interstate competition is a cornerstone of the U.S. Constitution.  Today is a great day, not only for clean energy manufacturers, but for innovators and entrepreneurs everywhere who wish to compete on an even playing field.”

PoliticoLawyer: Clinton ‘unable to obtain’ emails from first weeks as secretary

Former Secretary of State Hillary Clinton’s lawyer David Kendall says that while she has turned over all of her federal emails, but is “unable to obtain” emails from the beginning of her time in the State Department.  Mr. Kendall said the following in his letter: “She does not have custody of e-mails sent or received during the first few weeks of her tenure.” Kendall’s letter comes amidst ongoing lawsuits regarding Mrs. Clinton’s use of a private server, including the case brought by Cause of Action.

In Other News:

BreitbartDEM REP ON FBI INVESTIGATION OF CLINTON EMAILS: ‘ABSOLUTELY, I THINK IT’S LEGITIMATE’

Democrat Rep. Adam Schiff was asked if he thought the FBI should be investigating Hillary Clinton’s emails and private server.  He first insisted that the investigation wasn’t into Mrs. Clinton herself, but rather to find out when the classified emails on her server were originally marked as classified.  Eventually he did say “Absolutely, I think it’s legitimate for the Justice Department to look into the proper classification of the information and whether any steps need to be taken to protect it. If it’s out in the ethosphere because of this investigation, that’s perfectly appropriate.”

Washington ExaminerStates can sue EPA over climate rules starting Friday

Today the timer begins for states who want to sue the Environmental Protection Agency over the Clean Power Plan.  There are already 16 states who are ready to sue the EPA and the GOP plans to fight the rules in Congress.  As of today, states must either come up with alternative plans or provide a plan that will explain their compliance with the Clean Power Plan by September 2016.

NY PostRevolt of the watchdogs: Federal inspectors general vs. the Obama stonewall

Federal inspector generals have continued time and again to be blocked by the current administration.  Last year over 60 percent of the federal inspectors general wrote a letter stating “serious limitations on access to records that have recently impeded the work” and have reduced their “ability to conduct our work thoroughly, independently, and in a timely manner.”

Weekly Rundown 10-16-2015

Cause of Action in the News:

Daily Caller  – Watchdog Group Hopes To Depose Hillary, State Department Officials                                                                                                       
Cause of Action has requested to depose former Secretary of State Hillary Clinton, the Under Secretary of Management for State Patrick Kennedy, the State Department Inspector General Steve Linick, Deputy Assistant Secretary of State Margaret Grafeld, in addition to officials in the National Archives and Records Administration.

Our hope is that if the deposition of these individuals is allowed we will be able to shine a bright light onto the mystery of Hillary Clinton’s private email server.  A couple of the questions we plan on asking Mrs. Clinton include why she deleted emails in the first place and why she didn’t turn over electronic copies, which could contain insightful metadata.

In Other News:

Examiner.comFTC joins EPA, Justice in probes of Volkswagen

In addition to the Environmental Protection Agency and the Justice Department, the Federal Trade Commission has joined the Volkswagen investigation.  The FTC is planning on looking into VW’s advertisements.  With at least 250 consumer lawsuits in 28 states and criminal probes in other countries this just adds to the car manufacturer’s woes.

SlateIRS Hasn’t Finished Doing Windows Upgrades Because It Can’t Find a Bunch of Its Computers

Even after spending $128 million upgrading their computers from Windows XP on their computers and Windows 2003 from their servers, the Internal Revenue Service isn’t finished. An audit revealed that almost fifty percent of the servers and over a thousand computers have not yet been upgraded.  It was also revealed that the IRS cannot find these computers and servers to upgrade them. “At the conclusion of our fieldwork, the IRS had not accounted for the location or migration status of approximately 1,300 workstations and upgraded only about one-half of its Windows servers.”

Washington ExaminerNew EPA climate rules target your air conditioning

The Environmental Protection Agency has introduced new rules that will directly affect the American people in their homes.  Air conditioners and refrigerators are the next target the EPA has in its sights.  The EPA’s administrator said that the rules would get us closer to meeting the current administration’s climate agenda.

Business InsiderFacebook, Google, Amazon and other big tech companies just slammed a proposed US cybersecurity law

A group of large tech companies have grouped together and have gone after the Cybersecurity Information Sharing Act, which they claim “does not sufficiently protect users’ privacy or appropriately limit the permissible uses of information shared with the government.”  The act is supposed to make it easier for the government to get customer information from big tech companies.  As of right now, the Cybersecurity Information Sharing Act is being deliberated in Congress.

Wall Street JournalClinton Server’s Technical Problems Boosted Use of Personal Accounts (In less than a month, the server appeared to stop functioning at least twice, according to emails the conservative group Citizens United obtained)

By now everyone has heard of former Secretary of State Hillary Clinton’s private email server.  What everyone may not know is that after being in use for only a month the server started having technical difficulties.  When the server was down the email addresses that it was responsible for weren’t working either, which may have led to the use of personal email accounts to send State Department emails.