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House GOP Needles Labor Nominee on Eve of Senate Committee Vote

Bill Clark/CQ Roll Call File Photo
Republicans argue that Perez, above, improperly brokered a deal with the city of St. Paul, Minn.

With a Senate committee vote set for Wednesday on the nomination of Thomas E. Perez for Labor secretary, House Republicans convened a joint hearing Tuesday to examine a whistle-blower case that GOP lawmakers have been using as ammunition against him.

The witnesses at the House hearing included Sens. Charles E. Grassley of Iowa and Johnny Isakson of Georgia, two Republicans who have been highly critical of Perez, currently the assistant attorney general in charge of the Justice Department’s Civil Rights Division.

Republicans argue that Perez improperly brokered a deal with the city of St. Paul, Minn., in which the city withdrew from a Supreme Court lending discrimination case in exchange for the federal government agreeing not to join a pair of housing-related False Claims Act lawsuits against the city that were instigated by whistle-blower Frederick Newell.

Grassley and Isakson testified that the lawsuits had the potential of returning up to $200 million in damages to the Treasury, and they accused Perez of attempting to cover up his involvement and submitting misleading statements to investigators.

The case before the Supreme Court challenged the use of statistics to prove racial discrimination, and Justice Department officials reportedly were concerned that the court could strike down the practice. Grassley said DOJ sent his staff a 33-page slide show Monday night documenting career lawyers’ support for Perez’s decision in the case.

“Getting such a critical document so late in this investigation could be construed as a cover-up,” Grassley said. “I expect any remaining documents will be immediately forthcoming.”

Newell also testified at Tuesday’s hearing, held by an Oversight and Government Reform subcommittee and a Judiciary subcommittee, which featured heavy partisan bickering.

“Mr. Perez manipulated the law and pushed the limits of justice,” said Rep. Trent Franks, R-Ariz. “Mr. Perez went out of his way to find leverage to use against the city of St. Paul. He tried to cover up his deal.”

Rep. Jerrold Nadler, D-N.Y., countered: “This hearing is part of a shameful smear campaign against Mr. Perez.”

Senate Committee Vote Looms

Republicans had originally invited Newell to testify at an April 25 hearing before the Senate Health, Education, Labor and Pensions Committee, which was slated to take place directly after a committee vote on Perez’s nomination. But Chairman Tom Harkin, D-Iowa, postponed the nomination vote until Wednesday to appease GOP demands for additional information on Perez and also canceled the whistle-blower hearing.

“It’s really a shame we didn’t have the hearing two weeks ago when we called Mr. Newell in, because then we would have had all the facts on the table,” Isakson said Tuesday after the House hearing.

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