Party Vetters Say Questions Never End

Posted September 3, 2008 at 6:19pm

For the past several months, ethics lawyers have faced a flurry of queries as companies, lobbyists and nonprofits have grappled with the new ethics rules ahead of the national conventions.

With more than 600 events planned during the Democratic and Republican conventions, one thing is for sure — the parties never stopped.

Neither have the questions.

“A tremendous amount of effort went into planning for this convention,” said Brett Kappel, an ethics lawyer of Vorys, Sater, Seymour and Pease. “People took it seriously and a huge, huge number of requests were made to both ethics committees.”

But as groups pivoted to turn GOP parties and fundraisers into Hurricane Gustav relief efforts, ethics lawyers say the calls continued to come in, with organizers wondering what changes would be kosher under the rules.

In some instances, particularly when Members of Congress were hosting, the advice was to go ahead with the event as planned instead of changing it into a hurricane-related relief effort.

The reason: Lawmakers soliciting contributions from lobbyists for charities runs afoul of long-standing ethics law.

“Basically, I have been reminding everybody that things have been carefully constructed to make sure that they conform to the ethics rules,” said Cleta Mitchell, an ethics lawyer at Foley & Lardner.

Mitchell, who advises lawmakers, said she put together a memo earlier this week detailing the rules of Members soliciting funds for charitable organizations.

“The rules say it is permissible for Members to solicit for charitable organizations that they don’t establish or control, but they can’t solicit a lobbyist,” Mitchell said.

The rules don’t stop former public servants from going ahead with corporate-sponsored events. Former New York Mayor Rudy Giuliani went ahead with a rooftop event Monday at Seven Nightclub in Minneapolis.

The event put on by Monica Notzon of the Bellwether Group used former Arkansas Gov. Mike Huckabee’s wife, Janet, who has been involved with the Arkansas Red Cross, to solicit contributions. The event raised nearly $30,000 for the Red Cross.

“All of the events that I’ve done already have been corporate paid events,” Notzon said. “We thought, ‘instead of canceling everything, wasting everybody’s money, why don’t we add a fundraising component to it.’”

Many other trade association- and corporate-sponsored parties also continued to turn soirees into hurricane-related relief efforts, which lead to a variety of ethics inquiries for lawyers.

The question of whether raising money for a charity would change the categorization of the party to a “charity event,” which have more lax rules, came up several times, says Stefan Passantino, an ethics lawyer at McKenna Long & Aldridge.

“While it is true that there is an ethics exception for charity events — where there are considerably broader rules for providing transportation and meals — the ethics rules are really clear that the primary purpose has to be for a charity,” Passantino said. “None of the sponsors felt as though they could really use that exception.”

In Denver, organizations continued to struggle with the House Committee on Standards of Official Conduct definition of entertainment and whether they would need to charge House Members and staff to attend.

“There have been a lot of questions we’ve been dealing with for months, having to do with the specifics of catering different events and dealing with the kind of musical entertainment,” said Robert Kelner of Covington & Burling. “To some extent, there’s been somewhat evolving guidance coming out of the ethics committees, particularly the House ethics committee, over time.”

The continued uncertainty caused some groups to make last-minute event changes, such as the Recording Industry Association of America’s decision on its Aug. 27 night concert in Denver, which it co-hosted with the ONE Campaign.

Featuring Kanye West, the event was originally free to all Members and staff because it was considered a “widely attended” event. But on the first day of the Democratic National Convention, the group decided to charge House Members and staff $90 for a ticket as a fair-market value.

Ethics lawyers say they haven’t heard much in the way of complaints by watchdog groups about events or parties at the conventions, although many said that was only a matter of time.

“I don’t doubt for a minute that there will be good government groups and perhaps media organizations looking to generate issues, to highlight scandal,” Kelner said. “That happens after every convention. I think that will fall particularly flat because so many thousands of hours were spent literally vetting these events through the ethics committees.”

Public Citizen is one watchdog group that has already raised questions about several of the events in Denver and St. Paul, Minn. Working in conjunction with the Sunlight Foundation, Public Citizen has been particularly leery of ways that lobbyists have tried to get around instances where it feels that events aren’t complying with all of the rules.

“We’ve got the House ethics committee and Senate Ethics Committee coming up with contradictory interpretations of the rule,” said Craig Holman of Public Citizen. “There’s a huge wave of uncertainty about what’s legitimate and not. Lobbying organizations are exploiting that uncertainty.”

Other watchdog groups such as Democracy 21 and the Campaign Legal Center have been happy with how the ethics rules have curbed much of the largess.

“The events that the ethics rules were designed to get rid of for the most part were eliminated at these conventions,” said Fred Wertheimer of Democracy 21. “They were the biggest influence-seeking abuse situations, where lobbyists were bankrolling parties that were really being thrown by Members of Congress.”

One issue that many watchdog groups would like to see changed is the House ethics committee’s guidance that events could be held in honor of multiple lawmakers. That guidance is expected to be one of the first things that groups like Democracy 21 and the Campaign Legal Center focus on. A bigger issue could be reforming the campaign finance law and closing the loophole that allows host committees to accept soft money.

“These rules were never meant to be the skunk at the garden party, or to say there was not supposed to be parties,” said Meredith McGehee of the Campaign Legal Center. “The most egregious things I’ve heard about and seen at the conventions, at their heart, are campaign finance problems.”