# Petition — Committee to Elect Lyndon LaRouche v. Federal Election Commission > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385006_1279%3A1 ## Record - **Collection:** Supreme Court brief - **Document type:** Petition - **Published:** January 1, 1980 - **Citation:** 444 U.S. 1074 ## Text v, — Court, UL > 1 ‘ILE 79-80h | . 1 nen if NOV 21 1979 ° aT Y ‘ MiCHam ROBLK ID co IN THE a EO IR, CLERR Supreme Court of the United States OCTOBER TERM, 1979 COMMITTEE TO ELECT LYNDON LAROUCHE, LYNDON LAROUCHE, JR. and LEROY B. JONES, Petitioners, y. FEDERAL ELECTION COMMISSION, Respondents. PETITION FOR WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE DISTRICT OF COLUMBIA CIRCUIT David S. Heller 304 W. 58th Street 5th Floor New York, New York Attorney for Petitioners INDEX ‘see oe Cees Oe Aminormies ................... i Pesan foe Were Gr GCertiorani.................2.., l eg os Sick cect as cesses seas t eS Lay o's Sha wa ddl | I tgp id okay se sb a oe | ES re ae 2 Provisions of the United States Code ............ eee SES ee ae eee EIS ee 6 ESE RISC ae as 0 20 Appendix A. Provisions of the U.S. Code Relevant to the Questions Presented ........ 2la B. Opinion and Order of the United States Court of Appeals for the District of Columbia Circuit eee 28a C. FEC General Counsel’s Request for Additional Information on Certification CE 62a D. CTEL response to FEC Request for Additional Information | 64a E. FEC General Counsel Memorandum to the FEC regarding Application of CTEL Gaeee Teovemmeer-2, 1976 .................%- 69a F. FEC Memorandum to the FEC Recommending Expansion of Audit of CTEL Gate meeeemeeer 27, 1970 ................. 148 G. FEC Memorandum to the FEC Regarding Confirmation of Individual Contributors st eo | H. CTEL Letter to FEC ES i rr 78a i CTEL Letter to FEC co a. y aa ee are 80a FEC Report to the FEC Regarding Compliance with 26 U.S.C. 9033(b) (3) and (4) dated February 10, 1977 ........ 82a . CTEL Letter to FEC dated March 7, 1977 Attaching Affidavits of Leroy Jones ne I ko 65 66k bb whos oe Gh RES 84a ii TABLE OF CASES AND AUTHORITIES: Cases: Blackburn v. Alabama 361 U.S. 199 (1960) ......... 10 Buckley v. Valeo ge ee. | are ere ee 10,11,17,18,19,20 Department of Agriculture v. oe a a) 11,13 Elliot v. Weinberger 564 F.2d 1219 Ce el ne sed as Goan coah 12 Kusper v. Pontikes 414 U.S. 51 (1973) ............. 18 Hannah v. Larche 363 U.S. 420 (1963) .......... 8,12 Johnson v. Robinson 415 U.S. 361 (1974) .......... 12 Jones v. FEC, D.C. Cir. No. 77-7093 (1979) 5,6,7,9,18,19 Miranda v. Arizona 384 U.S. 436 (1966) ........... 10 Murray's Lessee v. Hoboken 18 How. 272 (1856)..... 8 NAACP vy. Alabama 357 U.S. 449 (1958) ....... 17,18 Pollard v. Roberts 283 F. Supp. 248 .............. 18 U.S. v. Berrios 482 F. 2d 171 (2nd Cir. 1973) ....... 13 U.S. v. Erne 575 F.2d 212 (9th Cir. 1978) .......... 13 U.S. v. Oaks 508 F.2d (9th Cir. 1974) ............. 13 U.S. v. Steele 416 F.2d (9th Cir. 1972) ............ 13 Yick Wo. v. Hopkins 118 U.S. 356 (1886) .......... 12 Statutes: I ie 6 ane ner 6) as ihn pce ee 2la ae okies nb wins cece BME eS 23a >: Sa te I OD ne ee cc dese cc cas 25a 26 U.S.C. Section 9033(a)-(b) ........... 4,6,7,15,25a 26 USA. Betton FUSE) 2... 6. es eeu 14,15,27a p Bs ee ks gy eee eee 14,25a BO Ur, ND POD 6 ic in ss have caasaces 27a Be Ss a ea is vas iv SER SEN Se os 27a Other Authorities: pp RN ee ) iti No. 79- IN THE Supreme Court of the United States OCTOBER TERM, 1979 COMMITTEE TO ELECT LYNDON LAROUCHE, LYNDON H. LAROUCHE, JR. and LEROY B. JONES, Petitioners, v. FEDERAL ELECTION COMMISSION, Respondents. PETITION FOR WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE DISTRICT OF COLUMBIA CIRCUIT PETITION FOR WRIT OF CERTIORARI Committee to Elect Lyndon LaRouche, the 1976 prin- cipal campaign committee of Lyndon LaRouche, Lyndon LaRouche, and Leroy B. Jones pray that a Writ of Certiorari issue to review the judgment of the United States Court of Appeals for the District of Columbia Circuit entered in this case on August 23, 1979. OPINIONS BELOW The opinion of the United States Court of Appeals has not yet been reported and is set forth, with the original pagination, in the Appendix, beginning at page 28a. JURISDICTION The judgment of the Court of Appeals was entered on August 23, 1979. This petition for Writ of Certiorari was filed within 90 days of that date. The jurisdiction of this Court is invoked under 28 U.S.C. section 1254(1). QUESTIONS PRESENTED Did the Court below err in sustaining an FEC decision to deny Petitioner Presidential Primary Matching Funds, when: 1. the Court below found that the FEC had no legal basis for withholding funds during a three-month period in which the FEC labored to develop such a basis; 2. the reasons eventually relied upon by the FEC for denying funds included coerced statements obtained in violation of the First, Fourth, Fifth and Sixth Amendments to the U.S. Constitution; 3. CTEL was not accorded any form of notice what- soever of the adjudicative procedures by which the FEC denied funds; 4. CTEL was denied any opportunity whatsoever to participate in, make submissions to, or in any way present its case at the adjudicative hearing at which the FEC denied CTEL matching funds; 5. the entire FEC procedure was motivated by political animus and a desire to inflict punishment upon CTEL, and when the Court below then refused to hear any presentation on this issue? CONSTITUTIONAL PROVISIONS The following provisions of the United States Consti- tution are relevant to the questions presented. ARTICLE III Section 2 The Judicial Power shall extend to all Cases, in Law and Equity, arising under this Constitution, the Laws of the United States, and Treaties made, under their Au- thority;—to all Cases affecting Ambassadors, other public Ministers and Consuls;—to all cases of admiralty and maritime jurisdiction;—to Controversies between two or more States;—between a State and Citizens of another State;—between Citizens of the same State; claiming Land under Grants of different States, and between a State, or the Citizens thereof, and foreign States, Citizens or Sub- jects. AMENDMENT I Congress shall make no law respecting an establishment of religion or prohibiting free exercise thereof; or abridg- ing the freedom of speech, or of the press; or of the right of the people peaceably to assemble, and to petition the Government for redress of grievances. AMENDMENT IV The right of the people to be secure in their persons, houses, papers, and effécts, against unreasonable searches and seizures, shall not be violated, and no Warrants shail issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized. AMENDMENT V No person shall be held to answer for a capital or otherwise infamous crime, unless on a presentment or indictment of a Grand Jury, except in cases arising in the land or naval forces, or in the Militia, when in actual service in time of War or public danger; nor shall any person be subject for the same offence to be twice put in jeopardy of life or limb; nor shall be compelled in any criminal case to be a witness against himself, nor be deprived of life, liberty or property, without due process of law, nor shall private property be taken away for public use, without just compensation. PROVISIONS OF THE UNITED STATES CODE The following provisions of the United States Code are relevant to the questions presented and are set forth at length in Appendix A: 2 U.S.C. 437(d), 2 U.S.C. 438 (a)8 and 9, 5 U.S.C. Section 555, 26 U.S.C. 9033 (a) and (b), 26 U.S.C. 9036 (a), 2 U.S.C. 9038 (a) and (b) and 26 U.S.C. 9041(a). STATEMENT OF THE CASE This is a Petition for Certiorari, taken from an Opinion and Order of the United States Circuit Court of Appeals for the District of Columbia, dated August 23, 1979, affirming the administrative decision of the Federal Elec- tion Commission (‘““FEC’’) to deny the Committee to Elect Lyndon LaRouche (““CTEL”’) certification of eligi- bility for the payment of Presidential primary campaign matching funds. Petitioner CTEL is the principal campaign committee organized in October, 1975 to support the campaign of Lyndon LaRouche for the 1976 Presidential nomination of the U.S. Labor Party. Petitioner Lyndon LaRouche is an individual who, in 1976 sought and won the Presiden- tial nomination of the U.S. Labor Party. Petitioner Leroy Jones is an individual supporter of and contributor to CTEL and the 1976 LaRouche Presidential campaign. The Respondent is the Federal Election Commission. On October 14, 1976, CTEL notified the FEC that it had qualified for Presidential primary matching funds pursuant to 26 U.S.C. 9033(a) and (b). Fifteen other candidates, all from the Democratic or Republican parties had also applied, during the 1976 primary campaign, for matching funds. In each of those cases, the FEC followed an unvarying procedure—prucessing their claim expedi- tiously, and often disbursing funds without awaiting even prima facie substantiation of contributions. Certainly no candidate was subjected to a timeless and searching audit of each and every contribution and expense prior to being certified by the FEC to receive funds. However, candidate LaRouche, the candidate of a nonmajor party (and the only such candidate to have reached the matching funds threshold) was treated quite differently by the FEC and its staff. LaRouche submitted to the FEC on October 14, 1976 the three written arguments required under 26 U.S.C. 9033(a) and the four certifications required under 26 U.S.C. 9033(b). On October 21, 1976, the FEC requested information from CTEL concerning the nominating procedures of the U.S. Labor Party, questioning whether LaRouche was a bona fide primary candidate. CTEL replied to those quer- ies by October 23, 1976, and on October 27, 1976 sub- mitted a computer print-out listing all of its contributors and confirming that it had reached the matching payment i threshold requirements. The FEC staff, apparently satis- fied with the submission, assured CTEL that the submis- sion would be placed on the agenda of the FEC meeting scheduled for November 4, 1976 (after the general elec- tion, and after any disbursement would have allowed LaRouche to free himself of primary campaign debts and undertake vigorous campaigning for the general election). (See Appendix, pages 69a-73a.) As a result of the November 4 FEC meeting, CTEL was informed that the FEC would initiate a field audit of CTEL expenses prior to disbursing matching funds. A team of FEC auditors then spent some days in early and mid-November in CTEL’s offices examining the cam- paign’s books and records. Their conclusions were presented to the FEC almost one and a half months later, in a December 27 memoran- dum which raised entirely new questions. In that memo- randum, the auditors recommended expanding the audit to examine the books and records of CTEL’s major vendors and to directly contact contributors to verify contributions. (See Appendix, p. 74a.) The companion Petition for Certiorari, Jones v FEC, we.i demonstrates the state of mind and intentions of the FEC when it proposed and approved, without any vote, the contacting of CTEL contributors. Three months of investigation had produced nothing more than a series of idle speculations on the part of the FEC staff (see Appen- dix, pages 74a-75a). Clearly the contributor contacts were made in hopes of “developing a case” for nonpayment of the long-delayed funds. After this final “investigative” step, again a procedure © reserved solely for LaRouche and his contributors, the staff submitted their final recommendation—urging that, on the basis of coerced denials of contributions from three contributors, the FEC should rule that LaRouche had not met the threshold requirements. The FEC then voted on February 10, 1977 that LaRouche was not eligible for matching funds. A petition for review was filed with the United States Court of Appeals for the District of Columbia Circuit. In view of the long drawn-out investigative procedure, cul- minating in an in camera and ex parte decision to deny matching funds, and the refusal of the FEC to permit CTEL or LaRouche any opportunity whatsoever to con- trovert the staffs findings, or even to know the content of and nature of the staffs findings, Petitioners also moved before the Circuit Court of Appeals for extraor- dinary discovery. This motion the court denied. On August 23, 1979 the U.S. Court of Appeals, while admitting that LaRouche was afforded unique and illegal treatment (Slip Opinion at pages 21-26), affirmed the FEC decision. ARGUMENT If the companion Petition for Certiorari of Jones v FEC presents the question of whether a federal agency may constitute itself into a secret police force to inflict terror upon unsuspecting citizens, the case at bar raises the question of whether a rogue agency may assert itself as above the law entirely. In the case at bar, this Court must decide whether it was permissible for the FEC to constitute itself into a Court of Star Chamber, use inquisitorial tactics to deny its disfavored political candidates, ex parte, their rights under law, and, equally abhorrent, employ inventive and dilatory “investigative” tactics to postpone a decision while manufacturing the pretenses for the ultimate denial. In 1976, many candidates from the Republican and Democratic parties applied for primary matching funds pursuant to 26 U.S.C. 9033(a) and (b) (the Act). In every case, without exception, the FEC processed the applicant’s claim, and, often without awaiting even prima facie sub- stantiation, certified the applicant to the Secretary of the Treasury for the disbursement of funds on the basis of notice alone from the applicant. No pre-disbursement audit was ever attempted. There was, however, one unexpected guest at this feast of tax-supported largesse. Lyndon LaRouche, a candidate for the nomination of the U.S. Labor Party, raised the required amount of funds, in the proper distribution, to qualify for matching funds. The Republicans and Demo- crats who comprised the Commission were unhappy with this third party intrusion. The proper order of things was upset. The FEC therefore devised a new and unique series of procedures for the LaRouche application, which were applied to that application alone. The Act contemplated the universal use of the procedure which was in fact employed for all other candidates but LaRouche. Having expended funds in order to gain the nomination, a candidate plainly needs matching funds as soon as possible in order effectively to campaign. AI- though this need was most acute in Mr. LaRouche’s case, since his campaign period after application was the short- est of all candidates, the FEC decided on a pre-disburse- ment investigation of no one but LaRouche. The FEC then delayed LaRouche’s application for three months while deciding whether it approved of the U.S. Labor Party’s primary procedure. This was plainly in violation of the law. 26 U.S.C. 9033(a). More, the FEC then commenced an outrageous and unconstitutional campaign of terror and intimidation against unwary con- tributors to the LaRouche campaign. The Court below found this “‘investigation”’ to have given rise to substantial constitutional questions. See Jones v FEC, D.C. Cir. No. 77-2093 (1979), Slip Opinion. THE PROCEDURE FOLLOWED BY THE FEC DENIED LAROUCHE HIS RIGHTS TO DUE PROCESS AND EQUAL PROTECTION Many subtle distinctions have been drawn in the area of due process. In a final determination by an agency of the government which deprives a specific individual of a specific valuable benefit, to which he is prima facie enti- tled, however, one could reasonably expect that the pro- cedure accorded him would be grounded in the American concept of fair play. To this end certain irreducible minima have been found necessary. These principles have become, as the words “‘due process” originally signified, “the law of the land”’ Murray’s Lessee v Hoboken 18 How 272 (1856). Whatever the exact demarcation of the ele- ments of due process, they include, as a core minimum, the right to present one’s side of the story (preferably by counsel) before the deprivation is visited upon one. See Hannah v Larche 363 US 420 (1963). In the case at bar, both the FEC, and the Court below, made much of the “suspicious” pattern of contributions, and the supposed shortfall in contributions. See Slip Opinion at page 9, footnote 7, and page 11, footnote 9. At no time was LaRouche ever permitted to rebut this ‘showing’. The Court below stated in a forthright manner that the facts before the FEC did not disqualify LaRouche. They merely ‘raised substantial questions,” (Slip Opinion at page 9) or made up “information indicating” La- Rouche’s ineligibility (Slip Opinion at page 11). More- over, these ‘“‘facts’”” were only developed by the FEC for the purpose of litigation, after it had finally determined to deny LaRouche’s application. See infra. Nonetheless, without any notice to LaRouche, without any opportu- nity, whether face to face or otherwise, to rebut, without any disclosure to LaRouche as the pendency of the determination, the FEC issued a final, adverse verdict. Slip Opinion at page 12. And this procedure, shrouded in night and fog, was, incredibly, upheld by the Court below. Had CTEL been permitted to appear, or make a submission, the questions raised by the FEC would easily have been answered. For instance, the sequential money orders submitted by CTEL workers, about which both the FEC and the Court below make so much, are anything but extraordinary. When the Labor Party convention approached, CTEL supporters from across the country gathered in New York to push their candidate and make a final push for matching funds. All those who had not exhausted their legal limit on contributions went to the banks en masse to contribute. In this world of telethons, rallies, mass mailings and benefits, this is as usual as a “get out the vote” campaign. Yet, CTEL was never even informed that the FEC planned to manufacture an “‘irreg- ularity” from this activity. The Court below accepted this shocking secret decision-making procedure. At least as offensive to both logic and the sense of decency and fair play is the Court’s bland acceptance of the claimed “shortfalls” (Slip Opinion at page 11, footnote 9 and page 31) in meeting matching fund threshold criteria. In the accompanying case, Jones v FEC, the Court below partially reversed Summary Judgment for the defendant FEC et al., ruling that there were properly alleged violations of Constitutional rights in the FEC’s unannounced, threatening ‘“‘visits” to individual CTEL contributors. Even within the over-confined constitutional protections accorded the contributors by the Court below, is it not offensive to reason to refuse to recognize that many a person, faced with threats of jail emanating from the intimidating presence of unannounced surprise visi- tors, might deny contributions actually made? Such denial, under threat, is not foreign to the noblest minds. See Matthew, chapter 26, verses 33-75. Although one of the disciples of Christ was moved by coercive circumstances to deny his Lord “three times ere the cock crew,” the Court reaches the incredible conclusion that despite ac- knowledged violations of the law, ‘“‘we do not believe that our holding in No. 77-2093 [Jones v FEC] renders suspect the reliability of the results of the field interviews.”’ Slip Opinion at page 31, footnote 23. To a court at all sensitive to the constitutional implications of sudden, Gestapo-style political interrogations of private citizens, as the Court below was not, the conduct underlying the companion Jones case would have served as an alarm. The Court below committed as plain an error in accepting the unlawfully extorted conclusions of non-contribution as truthful, as would a court in predicating a criminal conviction upon a confession induced by threats. It is not merely that a technical violation of, respectively, the FEC’s governing law, or the standards of Miranda v Arizona, 384 US 436 (1966) are committed (and the Court below concedes that the FEC’s actions were ultra vires, Slip Opinion at page 28) but that the FEC’s violations of law were so calculated as to make the denials of contri- butions inherently non-believable. A number of cases have demonstrated, if demon- stration were needed, that the efficiency of the rack and the thumbscrew can be matched, given the proper subject, by more sophisticated methods of persuasion. Blackburn v Alabama, 361 US 199 (1960). In fact, Petitioners urged the FEC on two separate occasions to conduct their interviews circumspectly with some guarantees of due process. The FEC did not. Peti- tioners then communicated to the FEC their doubts about the validity of the interviews in view of the tactics of harassment and intimidation employed. (See Appendix, page 80a.) See Miranda v. Arizona, supra. When the method em- ployed against Petitioner Jones in the companion case, which methods sent him to the hospital, were leveled against one of lesser will or “gumption,” no doubt the eager minions of the FEC could have extracted any statement they desired. In the area of political allegiance, of all areas, is it possible that such extracted statements will pass before the courts as true coin? If so, then it will not be long before the party that controls the FEC will be well entrenched against all comers. At that time, the conditions first warned of in Buckley v. Valeo, 424 US 1 (1976), will have come to pass. THE FEC DENIED CTEL EQUAL PROTECTION OF THE LAW The Court below conceded that the FEC treated CTEL differently. It is no denial of equal protection to treat different parties differently if the basis for classification is rational and not constitutionally impermissable. But 10 LaRouche, a citizen seeking the Presidential nomination of the party of his choice, was in all legally cognizable ways similar to all other applicants for FEC primary matching funds. Yet he was treated differently. The Court below suggests several reasons. The only one which is proper—the appearance of facial irregularities indicative of fraud—is concededly inapplicable to the case at bar. Accordingly, because the information on hand re- vealed no patent irregularities, the Commission was not warranted in conducting an investigation beyond the face of LaRouche’s threshold submission. Slip Opinion at page 28. The FEC did so nevertheless. The reasons, however they are dressed up in terms of CTEL’s only exceeding the statutory minimum by a few dollars, or a fear of “frivolous candidates” (Slip Opinion at page 15), in fact shine through: the FEC did not intend that an American citizen not belonging to one of the two parties whose hands controlled the FEC’s purse strings was going to benefit from legislation carefully engineered (in fact, orig- inally too carefully engineered, see Buckley v Valeo, supra to benefit themselves alone. Petitioners are not making merely an exclusionary claim—arguing that since the means were improper, the evidence so gathered may not be considered. The means most definitely were not only improper but more impor- tantly extortionate, because they were sufficiently terrify- ing to extract statements which simply were not true. If this unlawful and discriminatory conduct passes consti- tutional muster, then the Constitution is reduced to the indignity of a shell game. If these “confessions” extracted by investigative methods more suited to employment by the Spanish Inquisition, pass as uncontroverted evidence, then equal protection and due process have lost all mean- ing. Thus, the Court below plainly erred in acknowledging the denial of equal protection and due process, and then providing it with the imprimatur of non-prejudicial or 1] harmless error. (See Slip Opinion at page 29.) The FEC is entitled to make no distinctions on the basis of mem- bership or non-membership in a party, or possession of beliefs of which it approves or disapproves. Such discrim- ination is in no way similar to economic regulation and is thoroughly suspect. Department of Agriculture v Mor- eno, 413 US 528 (1973). The Fifth Amendment imposes upon the federal gov- ernment and its agencies the same obligations imposed on the States by the Fourteenth Amendment: according equal protection and due process to its subjects. Cf. Yick Wo v. Hopkins, 118 US 356 (1886), and cases collected in Johnson v. Robinson, 415 US 361, 364 n.4 (1974). The FEC denied CTEL both due process and equal protection. The minimum standard of due process would be to permit CTEL to rebut the claims of the FEC that it had not qualified for matching funds. As was stated in Hannah v. Larche, 363 US 420 (1960) in distinguishing investigative from adjudicative proceedings: Due process is an elusive concept. Its exact bound- aries are indefinable, and its content varies according to specific factual contexts. Thus, when governmental agencies adjudicate or make binding determinations which directly affect the legal rights of individuals, it is imperative that those agencies use the procedures which have traditionally been associated with the judi- cial process. 363 U.S. 442 (Emphasis added). Such rights were plainly denied to CTEL when the FEC made a final, binding determination on the basis of specious appearances and gave LaRouche no opportunity to appear, submit rebuttal evidence or to contest its findings and decisions in denying CTEL’s request for matching funds. Plainly when an agency makes such a determination, some form of notice and hearing is re- quired. Elliot v. Weinberger, 564 F.2d. 1219, 1235 (9th Cir., 1977). Even more compelling is the fact that the FEC singled 12 CTEL out for such “special treatment” based on CTEL’s exercise of its First Amendment rights and its having asserted them against the FEC. To use the powers of law in order to harm CTEL is so contrary to the Constitution as barely to merit discussion. Yet the Court below failed to rule on this contention. The Supreme Court has stated the law to be contrary to this: If the Constitutional conception of equal protection of the law means anything, it must at the very least mean that a bare ... desire to harm a politically unpopular group cannot constitute a /egitimate gov- ernment interest. Department of Agriculture v. Moreno 413 U.S. at 534 . (emphasis in original). In Moreno, the Supreme Court invalidated a law aimed at the associational rights of “‘hippies”’, pointing out that Congress could not act against hippies’ right to assemble in communes. Yet, the Court below upheld action by an agency which was aimed positively at CTEL for having supported LaRouche as its candidate for President, an activity closer to the core of the First Amendment than the gathering of food stamps at public expense. The Supreme Court has always closely inspected Congres- sional or other governmental activity when there is even the possibility that such activity was undertaken in order. to discriminate against a person or party for having exercised its First Amendment rights. So strong is this policy that otherwise valid criminal convictions have been reversed or remanded for further inspection when such animus appears to be present. U.S. v. Steele 416 F.2d 1148, (9th Cir. 1972); U.S. v. Oaks 508 F.2d (9th Cir. 1974), remanded for hearing; U.S. v. Berrios 482 F.2d 171, 181 (2nd Cir. 1973). At the very minimum, the highly probable showing of politically motivated animus in the persons making the adverse decisions, Messrs. Harris and Oldaker, should have been fully explored rather than summarily disregarded. Cf.U.S. v. Erne, 576 F.2d 212 (9th Cir. 1978) (animus, if any, not in decision-maker). 13 Thus the very minimal Constitutional protections: no- tice and hearing prior to adverse decision, and freedom from invidious classification aimed at the exercise of fundamental constitutional rights was denied to CTEL. On these grounds alone the Court should grant certiorari in order to reverse the decision below. THE FEDERAL ELECTION COMMISSION DID NOT COMPLY WITH ITS OWN MANDATE UNDER LAW Title 26 of the U.S. Code, sections 9033 and 9037 provide all the requirements for eligibility for primary matching fund payments. On October 14, 1976, candidate LaRouche filed with the FEC a letter agreeing to all the required conditions, and certifying to or attesting that he met the threshold requirements. On October 27, 1976, CTEL provided the FEC with a computer printout listing of all its contributors, confirming that it had reached the minimum threshold requirements for matching funds. This submission was apparently satisfactory to the staff of the FEC, who assured CTEL that the submission would be placed on the agenda of the FEC meeting scheduled for November 4, 1976. (See Appendix p. 68a) According to the recommendations of staff counsel, in a memoran- dum of November 2, 1976 to the Commission, prior to the November 4 meeting, the only substantive question raised regarding CTEL’s submission was whether or not certain contributions had been received prior to October 16. (See Appendix p. 69a-73a) Either the Commission willfully failed to address itself in a timely fashion to the question of the overall adequacy of CTEL’s submission or it implicitly accepted it, merely raising minor problems of verification. Under such circumstances, the minor problems were susceptible to being promptly cured and the FEC would then have been obliged, under 26 U.S.C. 9036 to certify to the Secretary of the Treasury, within 10 days, the candidate’s eligibility for primary matching funds payment. 14 Of course, even the FEC’s eight-day wait, between the October 27, 1976 computer printout submission and the November 4 consideration of the submission’s merits, caused a nonmajor party presidential candidate, burdened with debt from his primary campaign, extreme and unfair difficulty and hardship in the period leading up to the general election. This in itself indicates that the Commis- sion was in no rush to provide CTEL with treatment equivalent to that accorded the major party candidates applying for matching funds—each one of whom was promptly certified by the Commission to the Secretary of the Treasury for payment and scrutinized later. As the Court below found, Section 9036(a) of Title 26 of the U.S. Code “‘permits the Commission when deter- mining if a candidate has established his eligibility under Section 9033(b) (3)-(4), to look beyond the face of the candidate’s submission only if that submission (or that submission together with other reports on file with the Commission) contains patent irregularities suggesting the possibility of fraud.” (See Slip Opinion at page 16.) The FEC has argued in the Court below that, in fact, their three and a half month investigation of CTEL’s submission, culminating in its rejection (without ever making an offer of proof of its claim or permitting petitioner the opportunity to rebut its allegations), was not initiated by any such “patent irregularities suggesting the possibility of fraud.’ (See Appendix, page 37a.) Despite this straightforward admission by the FEC that it did not live up to its legislative mandate to certify matching funds payments expeditiously, the Court below ruled that the FEC’s ultra vires audit of CTEL was non- prejudicial because it would have uncovered “patterns of irregularities”. (Slip Opinion at page 28.) Whether the FEC would have uncovered “patterns of irregularities’ or would have invented an unending chain of speculation and suspicion, without allowing Petitioners to rebut the same, is discussed below. However, it is clear that although Petitioner had made the requisite agree- ments under 26 USC 9033(a) to provide the FEC with 15 whatever verification material was necessary, as early as October 14, 1976, and that the FEC had procured every- thing for which it had asked by February 2, 1977 at the latest (see Appendix, page 78a), it did not then act to certify LaRouche. Instead, in clear bad faith, it seized the opportunity to act on specious, untested information, to deny Petitioners’ certification. THE FEC STAFF CONSTRUCTED A “SINISTER WEB” TO PROVIDE SUPPORT FOR THEIR ALLEGATIONS OF IRREGULARITIES— IRREGULARITIES THEY NEVER PROVED In its memorandum of December 27, 1976, the FEC staff, after two months of investigation, itself admitted that CTEL had met the threshold requirements for match- ing funds. ‘“‘At the present time the Committee to Elect Lyndon LaRouche (CTEL) has reached the required threshold in 18 states and has collected in excess of $5,000 in 2 others. The Committee is currently obtaining the required documentation in these two states. The short fall is $69.00 in Connecticut and $195.00 in Indiana. It is the staff's belief that the requisite documentation will be submitted within a few days.” (See Appendix p. 74a.) Nonetheless, that same staff then proceeded to construct a ‘sinister web”, weaving together certain isolated facts which could easily be understood as the necessary conse- quences of the constrained financial and personnel re- sources of a nonmajor party candidate, into a conspiracy to defraud the FEC and the taxpayers. Even in the single case on record, that of former presidential candidate Milton Shapp, where an actual conspiracy and actual irregularities did exist, the FEC did not launch a far- reaching, pre-disbursement investigation. As a result of what can only be understood as the reluctance of the FEC and its staff to certify a nonmajor party candidate for matching funds, the staff's December 27 admission of LaRouche’s eligibility for matching funds merely served to spur demands for additional, extraneous 16 information concerning campaign vendors and contribu- tors. Did the FEC ever investigate the groups of consecu- tively numbered money orders which provided them with the ostensible “pattern of irregularities” leading the Court below to justify an ultra vires investigation? No. Do any of the numerous memoranda circulated to the FEC by its staff ever even mention this “pattern of irregularities” which figures so largely in the opinion of the Court below? No. (See Appendix p. 37a.) Did any member of the FEC staff ever question CTEL about the frequently cited groups of consecutively numbered money orders? No. In sum, the FEC’s “‘justification”’ for its extraordinary delay, far-reaching and burdensome audit, and harass- ment of contributors, is a post facto construction of its staff counsel. Had the court below permitted the discovery appellants requested to fill out the record, the bad faith evidenced by the sequence of events described above would have been glaring. THE FEC’S INVESTIGATION WAS CONDUCTED IN BAD FAITH FOR THE PURPOSE OF CHILLING PETITIONERS’ FIRST AMENDMENT RIGHTS. As this Court reiterated in Buckley v. Valeo 424 US. | (1976) when discussing the consequences of limiting the funds available to a candidate seeking election, ‘‘In view of the fundamental nature of the right to associate, governmental ‘action which may have the effect of cur- tailing the freedom to associate is subject to the closest scrutiny.” (NAACP v. Alabama 357 US 449 at 460-4161).” Buckley v Valeo, 424 US | at 26. The activities of the FEC in regard to the disbursement of matching funds, since they definitely concern the First Amendment rights of a candidate to political expression, cannot be evaluated on the “rational basis” standard, but also must withstand “strict scrutiny” that they were carried out in the fashion “least restrictive” of First Amendment rights. 17 The FEC, as we have shown above, was not investigat- ing ‘facial irregularities’ in CTEL’s matching funds submission; nor was it spurred to investigation by the pattern of claimed “‘facial irregularities.’ Rather, the FEC was concerned with expanding its audit to the vendors of CTEL and co-lessees of its office space. The FEC was concerned with conducting early morning “surprise visits” to CTEL contributors and threatening them with jail terms (See Jones v FEC). This court has also established standards for the breadth and reach of investigations like that conducted by the FEC. We have also insisted that there be a “relevant correlation” or ‘“‘substantial relation’’ between the governmental interest and the information required to be disclosed. See Pollard v Roberts, 283 F.Supp 248, 257 (E.D. Ark.) (three-judge court), aff'd, 393 U.S. 14 (per curiam). This type of scrutiny is neces- sary even if any deterrent effect on the exercise of the First Amendment rights arises, not through direct government action, but indirectly as an unintended but inevitable result of the government’s conduct in requiring disclosure. NAACP v Alabama, 357 US 449 at 461. Cf. Kusper v Pontikes, 414 US at 57-58. Buckley v Valeo, supra at 65-66. The FEC may have confused bureaucratic curiosity with “relevant correlation,” or it may have continued to manifest the bad faith cited above. However, the effect of its activities was the same. The FEC determined, accord- ing to its December 27 staff memo (see Appendix, p. 74a) that “it would be helpful’? to examine the records of CTEL’s major vendors. As well, noting that “the contrib- utor’s listed occupation seems unusual for fairly heavy political contributions”, the staff recommended confir- mation of contributions (all already documented by writ- ten instrument) should be done with contributors. (See Appendix, p. 75a). There was no allegation of “‘facial irregularity” or possible fraud. Rather, the inventive bu- 18 reaucrats at the FEC had hopes of developing some “helpful” angles upon which to hang its decision to deny CTEL equal treatment. Such inquisitiveness might not seem out of place in an Internal Revenue Service audit, or in the drawn out, leisurely proceedings of another regu- latory agency, but it hardly meets the standards of strict scrutiny and those of least restrictive alternative means required, even if the deterrent effect on First Amendment rights is unintentional. Had petitioners’ attorney not notified the FEC that legal action would be taken if LaRouche were not certified for matching funds (see Appendix, p. 81a), the FEC staff appears to have been prepared to “‘investigate’’ forever. In fact, in their final recommendation to the FEC— pushed reluctantly to action by the urgent demands of CTEL—the staff's final conclusion, and recommendation that matching funds be denied was based only on infor- mation gathered at the end of January, 1977. That “‘in- formation” was, in fact, merely the statements, made under considerable coercive pressure (see Jones v FEC, » supra) of three contributors, stating that they had not made some or all of the contributions claimed for them by CTEL. Had those statements been subjected to the same exhaustive scrutiny every portion of CTEL’s sub- mission and records were, undoubtedly the statements would have been retracted. After three and one half months of “investigation,” the staff provided the FEC only with “‘evidence”’ uncovered in the last two weeks. On that basis the FEC made its finding. THE FEC’S ACTIONS REPRESENT INVIDIOUS DISCRIMINATION AGAINST A NONMAJOR PARTY CANDIDATE Petitioners emphatically do not dispute the right of the FEC to establish procedures and regulations to carry out its mandate. However, this Court, while upholding the constitutionality of public financing, recognized that an appropriate factual demonstration could be made, based 19 upon the actual operation of public financing, to show that the implementation of the system invidiously discrim- inates against nonmajor parties and candidates. Buckley v Valeo, supra at 98. The case at bar demonstrates precisely such a situation. The string of speculative requests, the nitpicking bureau- cratic curiosity, and the browbeating of contributors is evident nowhere in the FEC’s treatment of the fifteen Republican and Democratic candidates who made match- ing funds submissions. The sensitive First and Fifth Amendment rights in- volved—particularly sensitive in the case of a nonmajor party candidate—were trampled by FEC staff, in pursuit of some unspecified theory of wrongdoing, unproven throughout the course of an arduous investigation. That investigation, far from being an effort ‘“‘closely drawn to avoid unnecessary abridgment of associational freedom” Buckley v Valeo, supra at 25, wandered from pillar to post, resulting in no actual findings of fact, depriving LaRouche contributors of their constitutional rights, har- assing the relatively few vendors who would consent to issue credit to a relatively unknown candidate, and cul- minated with the withholding of primary matching funds in violation of every principle of due process and equal protection. CONCLUSION A writ of certiorari should be granted. Respectfully submitted, David S. Heller 304 West 58th Street New York, New York 10019 (212) 247-7488 20 APPENDIX APPENDIX A Provisions of the United States Code 2 U.S.C. 437(d). Powers of Commission. (a)The Commission has the power— (1) to require, by special or general orders, any person to submit in writing such reports and answers to questions as the Commission may prescribe; and such submission shall be made within such a reasonable period of time and under oath or otherwise as the Commission may determine; (2) to administer oaths or affirmations; (3) to require by subpoena, signed by the chairman or the vice chairman, the attendance and testimony of wit- nesses and the production of all documentary evidence relating to the execution of its duties; (4) in any proceeding or investigation, to order testi- mony to be taken by deposition before any person who is designated by the Commission and has the power to administer oaths and, in such instances, to compel testi- mony and the production of evidence in the same manner as authorized under paragraph (3) of this subsection; (5S) to pay witnesses the same fees and mileage as are paid in like circumstances in the courts of the United States; (6) to initiate (through civil actions for injunctive, declaratory, or other appropriate relief), defend (in the case of any civil action brought under section 313(a) (9)), _ OF appeal any civil action in the name of the Commission for the purpose of enforcing the provisions of this Act and chapter 95 and chapter 96 of the Internal Revenue Code of 1954, through its general counsel; (7) to render advisory opinions under section 312 of this title; (8) to develop such prescribed forms and to make, amend, and repeal such rules, pursuant to the provisions of chapter 5 of Title 5, United States Code, as are necessary to carry out the provisions of this Act and 2la chapter 95 and chapter 96 of the Internal Revenue Code of 1954; (9) to formulate general policy with respect to the administration of this Act and chapter 95 and chapter 96 of the Internal Revenue Code of 1954; and (10) to conduct investigations and hearings expedi- tiously, to encourage voluntary compliance, and to report apparent violations to the appropriate law enforcement authorities. (b) Any United States district court within the jurisdic- tion of which any inquiry is carried on, may, upon petition by the Commission, in case of refusal to obey a subpoena or order of the Commission issued under subsection (a) of this section, issue an order requiring compliance there- with. Any failure to obey the order of the court may be punished by the court as a contempt thereof. (c) No person shall be subject to civil liability to any person (other than the Commission or the United States) for disclosing information at the request of the Commis- sion. (d) (1) Whenever the Commission submits any budget estimate or request to the President of the United States or the Office of Management and Budget, it shall con- currently transmit a copy of such estimate or request to the Congress. (2) Whenever the Commission submits any legis- lative recommendations, or testimony, or comments on legislation, requested by the Congress or by any Member of the Congress, to the President of the United States or the Office of Management and Budget, it shall concur- rently transmit a copy thereof to the Congress or to the Member requesting the same. No officer or agency of the United States shall have any authority to require the Commission to submit its legislative recommendations, testimony, or comments on legislation, to any office or agency of the United States for approval, comments, or review, prior to the submission of such recommendations, testimony, or comments to the Congress. (e) Except as provided in section 313(a)(9), the power 22a of the Commission io initiate civil actions under subsec- tion (a)(6) shall be the exclusive civil remedy for the enforcement of the provisions of this Act. 2 U.S.C. Section 438. Administrative provisions. (a) Federal Election Commission; duties It shall be the duty of the Commission— (1) Forms to develop and furnish to the person required by the provisions of this Act prescribed forms for the making of the reports and statements required to be filed with it under this subchapter; (2) Manual for uniform bookkeeping and report- ing methods to prepare, publish, and furnish to the person required to file such reports and statements a manual setting forth recommended uniform methods of book- keeping and reporting; (3) Filing, coding, and cross-indexing system to develop a filing, coding, and cross-indexing system consonant with the purposes of this subchapter; (4) Public inspection; copies; sale or use restric- tions to make the reports and statements filed with it available for public inspection and copying, commenc- ing as soon as practicable but not later than the end of the second day following the day during which it was received, and to permit copying of any such report or statement by hand or by duplicating machine, as requested by any person, at the expense of such persons: Provided, That any information copied from such reports and statements shall not be sold or utilized by any person for the purpose of soliciting contributions or for any com- mercial purpose; (5) Preservation of reports and statements to preserve such reports and statements for a period of ten years from date of receipt, except that reports and statements relating solely to candidates for the House of Representatives shall be preserved for only five years from the date of receipt; 23a (6) Indices of reports and statements; publication in Federal Register to compile and maintain a cumulative index of reports and statements filed with it, which shall be pub- lished in the Federal Register at regular intervals and which shall be available for purchase directly or by mail for a reasonable price, and to compile and maintain a separate cumulative index of reports and statements filed with it by political committees supporting more than one candidate, which shall include a listing of the date of the registration of any such political committee and the date upon which any such political committee qualifies to make expenditures under section 441a(a)(2) of this title, and which shall be revised on the same basis and at the same time as the other cumulative indices required under this paragraph; (7) Special reports; publication to prepare and publish from time to time special reports listing those candidates for whom reports were filed as required by this subchapter and those can- didates for whom such reports were not filed as so required; (8) Audits; investigations; priority audits and in- vestigations to make from time to time audits and field investigations with respect to reports and statements filed under the provisions of this subchapter, and with respect to alleged failures to file any report or statement required under the provisions of this subchapter, and to give priority to auditing and field investigating of the verifi- cation for, and the receipt and use of, any payments received by a candidate under chapter 95 or chapter 96 of title 26; (9) Enforcement authorities; reports of violations to report apparent violations of law to the appropriate law enforcement authorities; and (10) Rules and regulations to prescribe suitable rules and regulations to 24a carry out the provisions of this subchapter, in accordance with the provisions of subsection (c) of this section. 5 U.S.C. Section 555. Ancillary matters. (a) This section applies, according to the provisions thereof, except as otherwise provided by this subchapter. (c) Process, requirement of a report, inspection, or other investigative act or demand may not be issued, made, or enforced except as authorized by law. A person compelled to submit data or evidence is entitled to retain or, on payment of lawfully prescribed costs, procure a copy or transcript thereof, except that in a nonpublic investigatory proceeding the witness may for good cause be limited to inspection of the official transcript of his testimony. 26 U.S.C. Section 9033. Eligibility for payments. (a) Conditions. To be eligible to receive payments under section 9037, a cundidate shall, in writing— (1) agree to obtain and furnish to the Commission any evidence it may request of qualified campaign ex- penses; (2) agree to keep and furnish to the Commission = records; books, and other information it may request; an | (3) agree to an audit and examination by the Com- mission under section 9038 and to pay any amoun's required to be paid under such section. (b) Expense limitation; declaration of intent: minimum contributions. To be eligible to receive payments under — 9037, a candidate shall certify to the Commission that— (1) the candidate and his authorized committees will not incur qualified campaign expenses in excess of the limitations on such expenses under section 9035; (2) the candidate is seeking nomination by a pollit- ical party for election to the office of President of the United States; 25a (3) the candidate has received matching contribu- tions which in the aggregate, exceed $5,000 in contribu- tions from residents of each of at least 20 States; and (4) the aggregate of contributions certified with respect to any person under paragraph (3) does not exceed $250. 26 U.S.C. Section 9038. Examinations and audits; repay- ments. (a) Examinations and audits. After each matching pay- ment period, the Commission shall conduct a thorough examination and audit of the qualified campaign expenses of every candidate and his authorized committees who received payments under section 9037. (b) Repayments. (1) If the Commission determines that any portion of the payments made to a candidate from the matching payment account was in excess of the aggregate amount of payments to which such candidate was entitled under section 9034, it shall notify the candidate, and the can- didate shall pay to the Secretary an amount equal to the amount of excess payments. (2) If the Commission determines that any amount of any payment made to a candidate from the matching payment account was used for any purpose other than— (A) to defray the qualified campaign expenses with respect to which such payment was made; or (B) to repay loans the proceeds of which were used, or otherwise to restore funds (other than contributions to defray qualified campaign expenses which were received and expended) which were used, to defray qualified cam- paign expenses; it shall notify such candidate of the amount so used, and the candidate shall pay to the Secretary an amount equal to such amount. (3) Amounts received by a candidate from the matching payment account may be retained for the liq- uidation of all obligations to pay qualified campaign expenses incurred for a period not exceeding 6 months after the end of the matching payment period. After all obligations have been liquidated, that portion of any 26a unexpended balance remaining in the candidate’s accounts which bears the same ratio to the total unexpended balance as the total amount received from the matching payment account bears to the total of all deposits made into the candidate’s accounts shall be promptly repaid to the matching payment account. (c) Notification. No notification shall be made by the Commission under subsection (b) with respect to a match- ing payment period more than 3 years after the end of such period. (d) Deposit of repayments. All payments received by the Secretary under subsection (b) shall be deposited by him in the matching payment account. Section 9036 Certification by Commission. (a) Initial Certifications. Not later than 10 days after a candidate establishes his eligibility under section 9033 to receive payments under section 9037, the Commission shall certify to the Secretary for payment to such candidate under Section 9037 payment in full of amounts to which such candidate is entitled under section 9034. The Com- mission shall make such additional certifications as may be necessary to permit candidates to receive payments for contributions under section 9037. Section 9041 Judicial Review. (a) Review of agency action by the Commission. Any agency action by the Commission made under the provi- sions of this chapter shall be subject to review by the United States Court of Appeals for the District of Col- umbia Circuit upon petition filed in such court within 30 days after the agency action by the Commission for which review is sought. 27a ° Notice: This opinion is subject to formal revision before publication in the Federal Reporter or U.S.App.D.C. Reports. Users are requested to notify the Clerk of any formal errors in order that corrections may be made before the bound volumes go to press. United States Cmert of Appeals FOR THE DISTRICT OF COLUMBIA CIRCUIT No. 77-1184 5 COMMITTEE TO ELECT LYNDON LA ROUCHE, LYNDON LA ROUCHE, AND LEROY B. JONES, PETITIONERS Vv. FEDERAL ELECTION COMMISSION, RESPONDENT Petition for Review of an Order of the Federal Election Commission Argued September 27, 1978 Decided August 28, 1979 Robert Case Liotta with whom Joel D. Jdseph was on the brief, for appellants. Charles N. Steele, Associate General Counsel and Bar- bara Van Gelder, Attorney, Federal Election Commission, with whom William C. Oldaker, General Counsel, Lester Bills of costs must be filed within 14 days after entry of judgment. The court looks with disfavor upon motions to file bills of costs out of time. 28a 2 N. Scall, Assistant General Counsel, Federal Election Commission, were on the brief, for appellee. Before McGowAN and TAMM, Circuit Judges, and JUNE L. GREEN,” District Judge. Opinion for the court filed by Circuit Judge MCGOWAN. McGowan, Circuit Judge: This is a petition for re- view of a decision of the Federal Election Commission (Commission) withholding from Lyndon La Rouche, a 1976 candidate for the Presidential nomination of the United States Labor Party (USLP), certification to re- ceive primary matching funds under the Presidential Primary Matching Payment Account Act, 26 U.S.C. §§ 9031-9042 (1976).1 The Commission refused to certify La Rouche on the ground that he had not established his eligibility under the fundraising threshold of the Act. Petitioners, La Rouche and the Committee to Elect Lyn- don La Rouche (CTEL),? now raise both statutory and constitutional objections to the legal standards and certifi- cation procedures invoked by the Commission in making * Of the United States District Court for the District of Columbia, sitting by me a pursuant to 28 US.C. § 292 (a) (1976). 1 This petition for review was consolidated for purposes of oral argument with Jones v. Federal Election Commission, No. 77-2093, and Federal Election Commission v. Committee A Elect Lyndon La Rouche, et al., No. 77-1987, decided this te. References herein to the petitioners’ appendix and supple- mental appendix in the instant case are designated as “P.A.” and “S.A.” respectively. In addition, references herein to the appendix in No. 77-2093 are designated as “A.” ? The Committee to Elect Lyndon La Rouche (CTEL) was the principal campaign committee organized to obtain contri- butions for La Rouche and to manage his campaign. Through- out this opinion, we refer to La Rouche and CTEL inter- changeably except where indicated otherwise, 29a 3 that determination. For reasons stated below, we affirm the decision under review. I The Presidential Primary Matching Payment Account Act (Act), enacted in 1974, provides for limited public funding of Presidential primary elections by authorizing federal matching payments for certain small contri- butions to eligible candidates. The eligibility require- ments are twofold.’ First, a candidate must agree, in writing, (1) to provide to the Commission any evidence it requests regarding qualified campaign expenses, (2) to maintain and furnish to the Commission any records or other information it requests, and (3) to submit to an audit by the Commission under section 9038 of the Act and to repay any amounts required under that section. Id. § 9083(a). Second, a candidate must “certify” to the Commission that (1) the candidate and his authorized committees will not incur qualified campaign expenses in excess of the limitations on such expenses under section 9035, (2) the candidate is seeking nomination by a political party for election to the office of President of the United States, (3) the candidate has received matching contri- butions which in the aggregate, exceed $5,000 in contributions from residents of each of at least 20 States, and 3 The Commission’s regulations, which were only proposed at the time La Rouche applied for matching funds, outline the eligibility requirements in detail. See 11 C.F.R. §§ 130.1-134.3 (1977). During the 1976 election, the Commission relied on its “interim guidelines” in determining whether to certify candidates to receive primary matching funds. See 40 Fed. Reg. 33817, 41938 (1975). 30a i 4 (4) the aggregate of contributions certified with respect to any person under paragraph (3) does not exceed $250. Id. § 9033(b) (emphasis added). The Act defines the term “contribution,” for purposes of the fundraising threshold of section 9033 (b) (3)-(4), as “a gift of money made by a written instrument which identifies the person making the contribution by full name and mailing ad- dress.”* Id. § 9034(a). The Commission, no later than ten days after a candi- date “establishes his eligibility” under the aforementioned criteria, is required to certify to the Secretary of the Treasury for payment to the candidate the full amount to which he is entitled. Jd. § 9086(a). That amount is equal to the first $250 or less in total contributions received from each contributor on or after the beginning of the calendar year immediately preceeding the calendar year of the Presidential election for which the candidate is seeking nomination. Id. § 9084(a). No candidate, how- *The term “contribution,” as defined for these purposes, does not include “a subscription, loan, advance, or deposit of money, or anything of value or anything described in sub- paragraph (B), (C), or (D) of section 9032(4).” 26 U.S.C. tee (a) (1976). Those subparagraphs of section 9032 (4) refer to (B) ...acontract, promise, or agreement, whether or not legally enforceable, to make a contribution for any such purpose, : (C) ... funds received by a political committee which are transferred to that committee from another commit- tee, and (D) ...the payment by any person other than a candi- date, or his authorized committee, of compensation for the personal services of another person which are ren- dered to the candidate or committee without charge .... Td. § 9082(4) (B), (C), (D). See also 11 C.F.R. § 180.8-.9 (1977). 3la 5 ever, may receive matching funds in excess of one half of the total expenditure ceiling to which he has assented as a condition for establishing his eligibility. Jd. §§ 9033 (b) (1), 9085(a). The Secretary, upon receipt of the Commission’s certification for payment but not before the beginning of the calendar year in which the general election for the office of President will be held, is required to transfer promptly the certified amount from an ac- count, known as the Presidential Primary Matching Pay- ment Account,® to the candidate. Id. § 9037(b). After a party selects its Presidential nominee, the Com- mission is required to conduct a thorough examination and audit of the qualified campaign expenses of any candidate who received matching funds in pursuit of the nomination. Jd. § 9038(a). Matching funds that the Commission determines either (1) were received in ex- cess of the amount to which a candidate was entitled or (2) were used for other than authorized purposes, must be repaid to the Secretary. Jd. § 9038(b). Stiff criminal penalties also are provided for excess campaign expenses, — the unlawful use of payments, false statements, and kick- backs and illegal payments. Jd. § 9042. II The events culminating in this petition for review began on October 14, 1976, when La Rouche wrote the Commission requesting primary matching funds for his 526 U.S.C. §9037(a) (1976). The Presidential Primary Matching Payment Account is one account in the Presidential Election Campaign Fund (Fund). Jd. § 9006. The Fund is financed from the general fund of the Treasury in the aggre- gate amount that individual taxpayers, who may authorize payment to the Fund of one dollar on an individual return and two dollars on a joint return, have designated for such purposes on their tax returns. Jd. §§ 6096, 9006(a). Other accounts are earmarked for financing party nominating con- ventions, id. § 9008, and general election campaigns, id. § 9006 (b). 32a <_ 6 campaign for the USLP Presidential nomination. In his letter, La Rouche proffered the requisite agreements to establish his eligibility under section 9033(a) and “certi- fied” that he also met the eligibility requirements of sec- tion 9083(b). This “certification” took the form of a one- page notarized statement that he met the eligibility cri teria outlined in section 9033 (b).° The Commission staff raised two sets of questions con- cerning La Rouche’s eligibility for matching funds. First, on October 21, 1976, the General Counsel of the Commis- sion (General Counsel) requested La Rouche to submit additional information regarding, inter alia, the nomi- nating procedures of the USLP and the states in which La Rouche was listed on the ballot as that party’s Presi- dential candidate. This information, the General Counsel explained, was needed to ensure that La Rouche had in fact taken part in a “primary election” within the mean- ing of the Act, and, if so, to determine the appropriate cut-off date for counting contributions towards establish- ing his eligibility. Second, the Commission staff requested further financial information to ensure that La Rouche had met the eligibility requirement of raising at least $5,000 in con- tributions of $250 or less in each of at least 20 states. * The letter from La Rouche provided in relevant part: In compliance with Section 9033(b) of the Federal Election Campaign Laws, I hereby certify that: 3. I have received matching contributions which in the aggregate exceed $5,000 in contributions from resi- dents of each of at least 20 states; and 4. The aggregate of contributions certified with re- spect to any person under paragraph (3) does not ex- ceed $250. P.A. 1. 33a 7 On October 14, 1976, when La Rouche applied for match- ing funds, CTEL had not as yet filed its disclosure report, due October 10, for financial activity in the third quarter of the year. Prior reports, which, contrary to the re- quirements of 2 U.S.C. § 484(b) (2), had failed to name and provide other identifying information about contribu- tors of more than $100, revealed that CTEL had raised far less in the period after January 1, 1975, than the minimum threshold amount of $100,000. P.A. 15. More- over, the third-quarter report, received on October 26, indicated that, between January 1, 1976, and September 30, 1976, CTEL had raised only $71,463.27 in total re- ceipts. S.A. 9. The Commission staff, by telephone, asked counsel for La Rouche about the apparent shortfall and the lack of names and other identifying information for contributors of more than $100. La Rouche’s counsel submitted information in response to both sets of questions raised by the Commission staff. In connection with the USLP nominating procedures, he filed, on October 22, 1976, information revealing that La Rouche had been nominated as the Presidential candidate of the USLP at its national nominating convention on October 16, 1976. The information further indicated that the USLP national convention, at which La -Rouche re- ceived the unanimous vote of the delegates from 30 states and the District of Columbia, was the culmination of a lengthy campaign during which La Rouche had sought and obtained the endorsement of the USLP Caucus in each of the 31 jurisdictions. With regard to the fund- raising threshoid, La Rouche’s counsel, at a meeting with Commission staff members on October 27, 1976, submitted a computer printout that, in addition to pro- viding the requisite information about contributors of over $100, indicated that, between October 1, 1975, and October 16, 1976, CTEL had received over $5,000 in con- tributions in each of at least 20 states. P.A. 15; S.A. 4. 34a 8 During the course of the October 27 meeting, the Com- mission staff indicated that the Commission was likely to consider these matters at its meeting scheduled for November 4, 1976, and, assuming that it decided to go forward with a field audit of the threshold submission, that audit would begin during the week following its meeting. P.A. 13-14. Rather than awaiting the Commis- sion’s decision, however, CTEL, on October 28, 1976, filed suit in the Dist-ict Court for the District of Colum- bia alleging that the Commission could not lawfully with- hold matching funds pending verification of the fact that La Rouche had met the fundraising minimum. Committee to Elect Lyndon La Rouche v. Federal Elec- tron Commission, C.A. No. 76-2010 (D.D.C. 1976). The District Court, on October 29, denied injunctive relief, and this court, on November 1, refused to grant a stay pending appeal. In December, the case was dismissed with the approval of the District Court. Meanwhile, on November 2, 1976, the Commission staff, after reviewing La Rouche’s application and supplemental submissions, reported its recommendations to the Com- mission. With regard to the USLP nominating pro- cedures, the staff expressed the view that “assuming the caucus process . . . is verifiable, Mr. La Rouche, through October 16, was a candidate for nomination of a political party, and therefore meets the requirements of [section] 9033 (b) (2).” P.A. 15. With regard to the fundraising threshold, the staff noted that no other application for matching funds during the 1976 election had raised the question of whether a candidate had met the threshold amount. Staff urged the Commission to authorize a field audit of the contributions to La Rouche’s primary cam- paign, to focus in part on whether certain contributions deposited after La Rouche was nominated on October 16, 1976, but reportedly received before that date, were in fact received before the nomination. This recommended 35a 9 focus reflected the General Counsel’s position that, under the Act, only those contributions received before a candi- date is nominated may be counted for the purposes of establishing the candidate’s eligibility for primary match- ing funds. On November 4, 1976, the Commission authorized the staff to conduct a field audit in order to verify La Rouche’s eligibility for matching funds. S.A. 5. That audit, which took place shortly thereafter at CTEL’s headquarters in New York City, revealed that CTEL had in its possession written instruments evidencing cam- paign contributions in excess of the threshold amount in 18 states and that, with the submission as promised of certain additional documentation, it would soon cross the threshold in two more states, Connecticut and Indiana. But, in addition to this soon to be corrected shortfall, the audit uncovered many instances where contributions made by money order or cashier’s checks raised substantial questions as to whether the contributions were in fact 10 revealed a pattern of heavy last-minute contributions from persons listing their occupation as that of “volun- teer coordinator” for the National Caucus of Labor Com- mittees (NCLC),® an organization that, during the last two weeks of the eligibility period, received payme ‘ts from CTEL of more than $310,000, which accounted fo. 55% of CTEL’s expenditures during the period. It fur- ther indicated that CTEL shared office space and common personnel with NCLC and three other organizations (New Solidarity International Press Service, Inc., Cam- paigner Publications, Inc., and the United States Labor Party) and that those organizations accounted for 78% of CTEL’s expenditures and 97% of its debt. These find- ings seemed particularly significant in light of the fact that CTEL had surpassed the $5,000 threshold by only a narrow margin in at least several states. made by residents of the states indicated.? The audit also 7 For example, the documentation of the contributions to La Rouche’s campaign revealed that many of the money orders and cashier’s checks were given in patterns that raised sub- stantial statutory questions. Examples are set forth below: (1) The following money orders were all drawn from the Bowery Savings Bank in New York City: 36a State Seria] numbers Date Submitted 4-114337 10/15/76 Massachusetts 4-114338 10/15/76 Colorado 4-1143839 10/15/76 Massachusetts 4-114341 10/15/76 North Carolina 4-114342 10/14/76 Delaware 4-114343 10/15/76 Massachusetts 8-obliterated 10/08/76 Connecticut 8-060756 10/12/76 Colorado [Continued] 7 [Continued] State Serial numbers Date Submitted 8-063400 (or 409) 10/18/76 Indiana 8-063407 10/13/76 Massachusetts 8-063408 8/01/76 North Carolina 8-06841 (7) 10/08/76 Colorado (2) The following cashier’s checks were all drawn from the Pacific National Bank of Washington: 2255209 - 9/28/76 Washington 2255210 9/28/76 Washington 2255217 9/29/76 Oregon 2255218 9/29/76 Oregon 2255219 9/29/76 Oregon 2255220 9/29/76 Oregon 2652298 10/05/76 Washington 2652294 ? Oregon ®The audit indicated that NCLC volunteer coordinators, 37a who contributed 16% of the total contributions received, ac- counted for as much as 83.2% of the contributions during October. 11 On December 27, 1976, the Commission staff submitted to the Commission two recommendations based on the field audit of CTEL’s records. The first recommendation, which the Commission adopted on December 29, 1976, was to expand the field audit to include an examination of the records of the four organizations related to CTEL. The second recommendation, which was adopted on Janu- ary 14, 1977, was to conduct a “confirmation of contri- butions with contributors ... before any initial payments are made.” P.A, 18, 24, 25. The direct verification of CTEL contributions took place during the week of January 26, 1977, when, after notifying CTEL, the Commission staff embarked on field interviews of individuals listed as CTEL contributors in three states, Delaware, Massachusetts, and Wisconsin. In the vast majority of cases, the staff was unable to locate the contributors in question, either because of in- sufficient time or because the contributors were not home or did not live at the address indicated. But, on the basis of those cases where the contributors were inter- viewed, the staff obtained information indicating that La Rouche had not in fact met the threshold requirement in either Delaware or Wisconsin.’ On February 2, 1977, CTEL submitted the documenta- tion of contributions from Connecticut that, at least ac- cording to the results of the initial audit, would have established that La Rouche had crossed the fundraising threshold in the last of 20 states. That documentation, it was asserted, established La Rouche’s eligibility under section 9033(b) (3)-(4) for matching funds and triggered the Commission’s obligation under section 9036(a) to certify La Rouche’s eligibility for payment to the Secre- ® The results of the field interviews indicated a shortfall of at least $383.25 in Delaware and $317.38 in Wisconsin. Sec page 51 infra. 38a 4% 12 tary of the Treasury within ten days. Legal action was threatened if the Commission did not certify La Rouche before February 14, 1977. On February 10, 1977, the Commission, relying on the results of the field interviews, concluded that La Rouche had not met the threshold requirement of raising at least $5,000 in contributions of $250 or less in each of 20 states. By so doing, the Commission rendered La Rouche ineligible to receive primary matching funds.’”® This peti- tion for review of the Commission’s decision was filed pursuant to 26 U.S.C. § 9041 on February 14, 1977. Ill This petition for review challenges on both statutory and constitutional grounds the Commission’s refusal to certify La Rouche’s eligibility to receive primary match- ing funds. Petitioners’ principal claim is that the Com- mission, by overstating both the burden that a candidate must shoulder to establish his eligibility under the fund- raising threshold of the Act and the role that the Com- mission is authorized to play in certifying a candidate’s eligibility, violated the Act when it rejected La Rouche’s application for matching funds. Petitioners also object on a variety of grounds to the investigative procedures in- voked by the Commission in determining that La Rouche had not demonstrated his compliance with the fundraising threshold. 10 Neither the parties, nor do we, address the question of whether La Rouche, through October 16, 1976, was “seeking nomination by a political party” for President, as required by section 9033(b) (2). Although the Commission suggests in its brief that it determined that La Rouche had complied with section 9033(b) (2), Resp. Brief at 11 n.5, we find no evidence in the record indicating that the Commission itself, as opposed to its staff, made such a determination. 39a 13 We examine these interrelated claims in the context, first, of determining what obligations the Act, consistent with the Constitution, imposes on both a candidate and the Commission during the process of certifying a candi- date’s compliance with the fundraising threshold of the Act, and, second, of assessing whether, in the instant case, the Commission properly determined that La Rouche had not established his eligibility under the fundraising threshold. A Two statutory provisions lie at the heart of the con- troversy over the respective roles of a candidate and the Commission during the certification process. The first provision, section 9033(b), provides that a candidate, as a condition precedent to qualifying for matching funds, “shall certify to the Commission that ... (3) [he] has received matching contributions which in the aggregate, exceed $5,000 in contributions from residents of each of at least 20 States, and (4) the aggregate of contributions certified with respect to any person under paragraph (3) does not exceed $250” (emphasis added). The second provision, section 9036(a), requires that “[n]Jot later than 10 days after a candidate establishes his eligibility under section 9033 . . ., the Commission [shall] certify to the Secretary for payment to such candidate .. . pay- ment in full of amounts to which such candidate is en- titled” (emphasis added). The Act, however, defines neither the term “certify” in section 9033(b) nor the phrase “establishes his eligi- bility” in section 9036(a). In the absence of such defi- nitions, the parties urge upon this court markedly differ- ent views of both what a candidate must do to establish his compliance with the fundraising threshold and what role the Commission is authorized to play during the certification process. 40a +? 14 Petitioners argue that a candidate seeking to establish his eligibility under section 9033(b) need only “attest authoritatively” in good faith and with knowledge that he has met the fundraising threshold. The Commission’s role under section 9036(a), according to petitioners, is limited to ensuring that the candidate has so attested. This con- struction of the Act, we are told, finds support in (1) common usage of the term “certify,” (2) the intent of Congress revealed in section 9036(a) to provide prompt payments to eligible candidates, and (3) the fact that the Act contains other mechanisms, including criminal sanctions and civil repayment provisions; adequate to ensure compliance with the eligibility requirements. Moreover, petitioners argue that if the Act were in- terpreted as providing for a lengthy and detailed certifi- cation process, it would be unconstitutional as regards La Rouche. The Commission asserts that the candidate’s burden in establishing his eligibility under the fundraising thresh- old of the Act is discharged not by attesting that he has raised the threshold amount, but rather by demonstrating to the Commission’s satisfaction that he has adequate documentation to establish that the threshold amount has been raised. We are also urged to conclude that the Com- mission, in determining whether a candidate has dis- charged this burden, is empowered not only to review the documentation of campaign contributions submitted by the candidate in support of his application for matching funds, but also to audit the records of his campaign con- tributions, and, if necessary, to verify reported contri- butions by means of interviewing individual contributors. This view of the certification process, the Commission argues, is supported by (1) the plain language of section 9036(a) requiring a candidate to “establish[] his eligi- bility” for matching funds, (2) the policy underlying section 9033(b) of withholding matching funds from 4la 15 frivolous candidates, and (3) the broad investigative pow- ers vested in the Commission under the Act, 26 U.S.C. §9039(b) (1976). The starting point in our inquiry into the respective statutory obligations of a candidate and the Commission during the certification process is, of course, the language of the Act itself. See Ernst & Ernst v. Hochfelder, 425 U.S. 185, 197 (1976). In this regard, we note that, on the one hand, section 9033(b) requires a candidate to “certify” his compliance with the fundraising threshold and, on the other, section 9036(a) requires the Commis- sion, “(nJot later than 10 days after a candidate estab- lishes his eligibility under section 9033,” to approve the candidate’s application for matching funds. Thus, if we were to give the word “certify” its ordinary meaning, which is “to attest authoritatively [in writing],”™ the Act would require the Commission, once a candidate had so attested, to approve his application within 10 days. The Commission, under this reading of the Act, would perform the quite limited task of rubberstamping no- tarized statements of eligibility. Such a certification process, we have no doubt, is not what Congress intended when it enacted the provisions at issue. Even petitioners recognize this point, conceding that not “anyone who signed . . . a statement [of eligi- bility] would immediately become eligible for funds; . clearly an element of knowledge and good faith is in- volved.” Pet. Br. 7. It is obvious, therefore, that we cannot interpret the statutory provisions at issue solely by reference to their wording. 11 Doherty v. McDowell, 276 F. 728, 730-31 (D. Me. 1921) (“certify” defined as “to attest authoritatively” and “any form which affirms the fact in writing is sufficient”) ; accord Higby v. Hooper, 124 Mont. 331, 221 P.2d 1043 (1950); Bates v. Bates, 247 Ala. 337, 24 So. 2d 440 (1946). 42a 16 In the absence of any specific directive in the legislative history, we must turn instead to the policies underlying the Act as a guide to our task of statutory interpretation. The policies relevant here are twofold. First, Congress, in enacting the fundraising threshold of section 9033 (b) (3)-(4), sought to withhold public funds from frivolous candidates. In this regard, the Committee on House Ad- ministration took the position that this modest threshold requirement is the most rea- sonable and best practicable test to assure that public funds are provided to serious candidates. By matching only small contributions the threshold pro- vides a means of testing public support of a candi- date and encourages a candidate to involve large numbers of voters in his fundraising efforts. H.R. Rep. No. 1239, 938d Cong., 2d Sess. 13 (1974) ; accord, S. REP. No. 689, 93d Cong., 2d Sess. 6 (1974) (“Such assistance is limited to those who demonstrate they are serious candidates by raising a threshold eligi- bility fund in small amounts from many contributors.”’). Second, Congress, by requiring the Commission under section 9036(a) to certify payments to a candidate not more than 10 days after the candidate establishes his eligibility, evidenced an intent to provide prompt pay- ments to eligible candidates. The 10-day deadline serves to ensure that an eligible candidate will have the money he needs at a time when its availability is most important to his campaign. The best way to accommodate these two policies is, we think, to construe the Act essentially along the lines ad- vanced by the Commission. That is to say, we agree that the Act requires a candidate seeking to establish his eligi- bility under section 9033(b) (3)-(4) to demonstrate to the Commission’s satisfaction that he has adequate docu- mentation to establish that the threshold amount has been raised. But, in light of the policy favoring prompt pay- 43a 17 ments to eligible candidates, we find it necessary to cir- cumscribe to a certain extent the scope of the Commis- sion’s investigative role during the certification process. To be specific, we construe the Act to provide for a certification mechanism that works as follows: The candidate’s burden in establishing his eligibility under section 9033(b) (3)-(4) is to submit documentation dem- enstrating that he has met the fundraising threshold. The candidate may do so either by submitting to the Com- mission the written instruments evidencing his campaign contributions ** or by making an equivalent showing." 12 The Act defines the term “contribution,” for the purposes of the fundraising threshold of section 9033(b) (3)-(4), as “a gift of money made by a written instrument which identi- fies the person making the contribution by full name and mailing address.” 26 U.S.C. §9084(a) (1976) (emphasis added). See note 3 supra. The Commission’s regulations carry forth the requirement that a “contribution” be made by written instrument. 11 C.F.R. § 180.8 (1977). 18 Section 131.2(c) of the Commission’s regulations, which was proposed at the time La Rouche applied for matching funds but not yet final, now defines what documentation a candidate must submit to establish his eligibility under sec- tion 9083(b) (3)-(4) of the Act. This regulation, which we find consistent with the Act, provides: For each State in which the candidate certifies he or she has met this requirement, the candidate shall— (1) Submit an alphabetical list of contributors show- ing each contributor’s full name and residential address, the date of the receipt of each contribution by the candi- date or his or her committee and of the deposit into the designated campaign depository, the dollar amount of each contribution submitted for matching purposes, the matchable portion thereof, the total amount of all match- able contributions submitted, and a notation as to whether the contribution was received as a result of an entertain- ment activity under § 130.9(i) ; and [Continued] 18 The Commission’s role under section 9036(a) is then to review the submission to determine whether it adequately documents the candidate’s compliance with the fund- raising threshcld. That determination, with a narrow exception discussed below, is limited to deciding, on the face of the candidate’s submission, (1) whether the re- ported contributions are in fact “contributions” within the meaning of the Act, 26 U.S.C. § 9034(a) (1976), and (2) whether the contributions that meet the statutory definition exceed the threshold amount, id. § 9033(b) (3)- (4). If this determination is adverse to a candidate, the Commission should so notify the candidate and permit him to resubmit his fundraising documentation. If the determination is favorable, and if the candidate has met the other eligibility requirements, the Commission, no later than 10 days after its final determination of eligi- bility, is required to certify for payment to the candidate the full amount to which he is entitled. Jd. § 9036(a). The limited exception under which the Commission’s section 9086(a) determination is not restricted to the face of the candidate’s submission is where that submis- sion (or that submission together with other reports on file with the Commission) contains patent irregularities suggesting the possibility of fraud.’* In such a case, the 18 [Continued] (2) Submit a photocopy of each check or other written instrument for each contribution which the candidate submits to receive matching funds. The photocopies shall be segregated alphabetically by deposit, and shall be ac- companied by copies of the relevant deposit slip. 11 C.F.R. § 131.2(c) (1)-(2) (1977). 14 The issue before us is the extent to which section 9036 (a) permits the Commission to look beyond the face of a candi- date’s threshold submission in determining whether the can- didate has established his eligibility for matching funds. Our conclusion that the Commission may do so only where it dis- 45a 19 Commission is empowered, as part of the certification process, to conduct a properly circumscribed investigation, including an audit of the candidate’s records and, if necessary, field interviews of the contributors to his cam- paign.’° The Commission, on the basis of the candidate’s covers that the threshold submission (or the submission to- gether with other reports on file with the Commission) con- tains patent irregularities suggesting the possibility of fraud in no way restricts the Commission’s otherwise broad investi- se powers outside the certification process. See note 17 infra. 15 Petitioners argue that the Commission is without statu- tory authority to conduct an audit during the certification process because the audit and repayment provisions of section 9038 contemplate an audit only after a candidate has received matching funds. We are urged to conclude, under the princi- ple of expressio unius est exclusio alterius, that Congress, by expressly providing only for post-certification audits, in- tended not to authorize pre-certification audits. The flaw in this argument is that petitioners have over- looked section 9039(b), which provides: The Commission is authorized to prescribe rules and regulations in accordance with the provisions of subsec- tion (c), to conduct examinations and audits (in addition to the examinations and audits required by section 90388 (a)), to conduct investigations, and to require the keep- ing and submission of any books, records, and informa- tion, which it determines to be necessary to carry out its responsibilities under this chapter. (Emphasis added). It would be inappropriate, in our view, to draw the inference suggested by petitioners because section 9038 is not the exclusive repository of the Commission’s audit- ing authority. 16 The Commission’s statutory authority to conduct field interviews during the certification process is encompassed in its broad investigative mandate “to conduct examinations and audits (in addition to the examinations and audits required by section 9038(a)) [and] to conduct investigations ... which it determines to be necessary to carry out its responsi- bilities under [the Act].” 26 U.S.C. §9089(b) (1976). This conclusion finds support in the fact that Congress has indi- 46a 20 submission and its own inquiry, must then determine whether the candidate in fact has established his com- pliance with the fundraising threshold. Id. § 9036(a). This interpretation of the Act serves the policies under- lying both statutory provisions at issue. The policy under- lying section 9033 (b) (3)-(4), which is to withhold funds from frivolous candidates, is served by requiring a candi- date either to submit to the Commission the written instruments evidencing campaign contributions or to make an equivalent showing. This requirement will provide the Commission with a ready means of detecting, and deny- ing certification to, a candidate who has not raised the threshold amount. If the threshold submission does not adequately document the candidate’s compliance with the fundraising threshold, the Commission is empowered, in- deed required, to withhold certification until the candidate submits appropriate documentation. If the threshold sub- mission contains patent irregularities suggesting the pos- sibility of fraud, the Commission is authorized to conduct an investigation during the certification process to de- termine whether the candidate in fact has raised the threshold amount.”’ cated elsewhere in the Federal Election Campaign Act, sec 2 U.S.C. § 488 (a) (8) (1976), that the Commission’s investiga- tive authority to conduct post-nomination ‘examination!s] and audit[s]” under section 9038 includes the power to verify contributions by means of field interviews. Inasmuch as the plain language of section 9039(b) confers upon the Commis- sion even broader investigative authority than that of sec- tion 9038, we think it follows that Congress must have in- tended to vest the Commission with the authority to conduct field interviews under section 9039(b) as well. 17 Nor is the Commission powerless to protect the fisc in the unlikely event that a fraudulent submission is not evident on its face. Nothing in this opinion restricts the Commission’s authority to conduct investigations under section 9039(b) outside the certification process, see note 14 supra, its author- 47a 21 The policy underlying section 9036(a), which is to provide prompt payments to eligible candidates, is served by limiting the role of the Commission during the cer- tification process to reviewing the face of a candidate’s threshold submission except where that submission (or that submission together with other reports on file with the Commission) contains patent irregularities suggesting the possibility of fraud. We so limit the Commission’s investigative role because long delays are sure to ensue in cases where the Commission looks beyond the face of a candidate’s threshold submission during the certification process.’* In the instant case, for example, the Commis- sion took more than three months after it authorized the initial audit of CTEL’s records to reach a final decision on La Rouche’s eligibility. Accordingly, we construe sec- tion 9036(a) to permit the Commission, as part of the ity under section 9038 to conduct post-nomination audits and to seek recoupment of overpayments, or its general investiga- tive and enforcement authority under the Federal Election Campaign Act, see, e.g., 2 U.S.C. §§ 487d, 487g (1976). 18 By contrast, the Commission has imposed on itself a five-day deadline for making a preliminary determination of a candidate’s eligibility on the basis of his threshold submis- sion. The Commission’s regulations provide: During the matching payment period, the Commission shall, as soon as practicable and generally within 5 work- ing days, examine the submission under § 131.1 and § 131.2(a), (b), and (c) and shall either— (a) Make a preliminary determination that the candi- date has satisfied the requirement of raising an amount in excess of $5000 in contributions from individuals who are residents of each of at least 20 States, which in re- spect to any individual do not exceed $250; or (b) Promptly notify the candidate giving a detailed explanation of the reasons for the Commission’s conclu- sion that the candidate has failed to satisfy the matching payment threshold requirements. 11 C.F.R. § 181.8 (1977) (emphasis added). 48a 22 certification process, to conduct an investigation beyond the face of a candidate’s threshold submission only in cases where patent irregularities appear on the face of that submission. Such cases are unlikely to involve can- didates who are in fact eligible for matching funds. The certification mechanism outlined above is far bet- ter tailored to the policies underlying the Act than that advocated by petitioners. To adopt petitioners’ view that the Commission must certify any candidate who, acting knowingly and in good faith, “attests authoritatively” that he has met the fundraising threshold would be, we think, to restrict unduly the Commission’s ability to detect frivolous candidates by shielding it from the documenta- tion of the candidate’s contributions..* Nor would peti- tioner’s interpretation of the certification process neces- sarily serve the policy of providing prompt payments to eligible candidates. It is our view that the inexact stand- ard of whether a candidate acted “knowingly and in good faith” might well result in lengthy investigations into what a candidate knew, or should have known, about his campaign contributions at the time he applied for match- ing funds. An additional advantage of the certification process outlined above over that advanced by petitioners is that the former, unlike that latter, involves objective stand- ards. The Commission, under our interpretation of sec- tion 9036(a), must determine as an initial matter (1) whether a candidate’s threshold submission adequately documents his compliance with the fundraising threshold 19 Nor do we feel that petitioners’ reading of the statute is compelled by the fact that the Act contains other mechanisms, including criminal sanctions and civil repayment provisions, also designed to ensure compliance with the eligibility require- ments. Nothing in the legislative history suggests that Con- gress regarded those other mechanisms as sufficient to protect against frivolous candidates receiving matching funds. 49a 23 and (2) whether that submission contains patent irregu- larities suggesting the possibility of fraud. Both inquiries involve essentially objective determinations regarding the adequacy of the threshold submission. The inquiry under petitioner’s view of the certification process would include the more subjective question of whether the candidate acted in “good faith” when he certified his compliance with the fundraising threshold. The advantage of an objective standard stems from the fact that, as petitioners themselves emphasize, the certification decision has an important impact on the exer- cise of first amendment rights, inasmuch as campaign funds “are often essential if ‘advocacy’ [of beliefs and ideas] is to be truly or optimally ‘effective.’” Buckley v. Valeo, 424 U.S. 1, 65-66 (1976). It also stems from the fact that the issue of whether a candidate has met the fundraising threshold often will arise in cases where a candidate either lacks national prominence or belongs to a minor party outside the mainstream of American politics. Given our national commitment to open and robust discussion of all political viewpoints, see, e.g., New York Times Co. v. Sullivan, 376 U.S. 254, 270 (1964), we regard it as particularly important to ensure that the Commission is applying the eligibility criteria for primary matching funds in an even-handed manner. Accordingly, we are reluctant to endorse a subjective standard such as “good faith” belief, preferring instead objective standards that circumscribe the Commission’s discretion and permit more meaningful judicial review. For essentially the same reasons that we believe that objective standards should govern the certification deci- sion, petitioners argue that if the Act were interpreted as providing for a lengthy and detailed certification proc- ess, it would violate the first amendment as a prior re- straint on La Rouche’s right to free speech. Citing the important role that campaign funds play in the advocacy 50a 24 of political beliefs, petitioners assert that “a procedure that would jeopardize the payment of matching funds, in the period precedent to the election when they would be crucial to the effective expression of political viewpoints, would be a serious abridgment of associational rights and free speech.” It is our view, however, that, at least as regards La Rouche, the certification process outlined above is con- stitutional. In upholding the constitutionality of fund- raising thresholds for federal matching funds, the Su- preme Court in Buckley v. Valeo noted: The States have .-. . been held to have important interests in limiting places on the ballot to those candidates who demonstrate substantial popular sup- port. E.g., Storer v. Brown, supra, at 736; Lubin v. Panish, supra, at 718-719; Jenness v. Fortson, 403 U.S. 481, 442 (1971) ; Williams v. Rhodes, 393 U.S., at 31-33. Congress’ interest in not funding hopeless candidacies with large sums of public money, S. Rep. No. 93-689, supra, at 7, necessarily justifies the withholding of public assistance from candidates without significant public support. Thus, Congress may legitimately require “some preliminary showing of a significant modicum of support,” Jenness v. Fortson, supra, at 442, as an eligibility requirement for public funds. 424 U.S. at 96 (emphasis added). Surely then, if Con- gress can require this preliminary showing of support as an eligibility requirement for matching funds, it can also impose reasonable procedures for ensuring that a candidate in fact has the requisite degree of support. The certification process outlined above is, we think, entirely reasonable, especially insofar as it permits the Commission to look beyond the face of a candidate’s thresh- old submission only if that submission contains patent irregularities. Certainly, on the record in this case (which we explore in detail below), La Rouche has failed Sla 25 to demonstrate that the Commission acted unreasonably, or even that it erred, in rejecting his application for matching funds. : In sum, we adopt the certification process outlined above, for it best serves the policies underlying the Act and turns on objective standards that circumscribe the Commission’s discretion and permit more meaningful ju- dicial review. Moreover, we see no first amendment barrier, at least as regards La Rouche, to our interpreta- tion of the Act. B. It remains for us to determine whether the Commis- sion, on the facts presented here, properly determined that La Rouche was ineligible for matching funds be- cause he nad not satisfied the threshold requirement of section 9033 (b) (3)-(4). Petitioners argue, on the basis of their interpretation of the Act, that La Rouche estab- lished his eligibility for matching funds either (1) on October 14, 1976, when he submitted a sworn statement that he had raised the threshold amount, (2) on October 27, 1976, when CTEL submitted a computer printout that listed contributions in excess of the threshold amount, or (3) on February 2, 1977, when CTEL submitted docu- mentation that, at least according to the results of the initial audit, would have established that La Rouche had crossed the fundraising threshold in the last of 20 states. The Commission takes the contrary view that, under its interpretation of the Act, La Rouche failed all along to establish his eligibility for matching funds. In light of the legal standards outlined in the preced- ing section, we now review the merits of the Commis- sion’s refusal to certify La Rouche’s eligibility for match- ing funds. We are cognizant of course that the scope of our review is limited to determining whether the Com- mission’s action was “arbitrary, capricious, an abuse of 52a 26 discretion, or otherwise not in accordance with law.” 5 U.S.C. § 706(2) (A) (1976).7° Turning to the facts at hand, we may quickly dispose of petitioners’ argument that La Rouche established his eligibility for matching funds during October 1976. The candidate’s burden in establishing his eligibility under section 9033 (b) (3)-(4) is, as we outlined above, to sub- mit documentation demonstrating that he has met the fundraising threshold. The candidate may discharge this - burden either by submitting to the Commission the writ- ten instruments evidencing his campaign contributions or by making an equivalent showing. It is beyond ques- tion that, on October 14, 1976, La Rouche had not estab- lished his eligibility under section 9033(b) (3)-(4), in- asmuch as he had done no more than to submit to the Commission a one-page notarized statement that he had met the fundraising threshold. Nor can we say that the Commission acted arbitrarily or capriciously in refusing to certify La Rouche on the basis of the computer print- out submitted on October 27, 1976, which listed contri- butions in excess of the threshold amount. It is our view that the Commission properly determined that a computer printout, which simply summarizes undocumented data, is not a showing equivalent to the documentation itself. Accordingly, we find no merit to petitioners’ argument 20 The Act provides that judicial review of action taken by the Commission is governed by the Administrative Procedure Act, see 26 U.S.C. § 9041 (1976), which, in turn, provides that, where as here agency action is not subject to formal rulemak- ing procedures, the applicable standard of review is whether the agency action was “arbitrary, capricious, an abuse of dis- cretion, or otherwise not in accordance with law,” see 5 U.S.C. § 706(2) (A) (1976). Cf. United States v. Florida East Coast Ry. Co., 410 U.S. 224 (1978). See generally Natural Re- sources Defense Council v. SEC, No. 77-1761, slip op. at 28-41 (D.C. Cir. April 20, 1979) ; Weyerhaeuser Co. v. Costle, 590 F.2d 1011, 1024-28 (D.C. Cir. 1978). 53a 27 that the Commission erred in not approving La Rouche’s applications for matching funds in October 1976. Nor do we find reversible error in the Commission’s decision, on November 4, 1976, to authorize a staff audit of CTEL’s records in New York for the purpose of veri- fying La Rouche’s eligibility for matching funds. Section 9036(a), as construed above, permits the Commission when determining if a candidate has established his eligibility under section 9033 (b) (3)-(4), to look beyond the face of the candidate’s threshold submission only if that submission (or that submission together with other reports on file with the Commission) contains patent irregularities suggesting the possibility of fraud. The information on hand when the Commission authorized the audit of CTEL’s records included (1) La Rouche’s original application for matching funds, submitted on October 14, 1976, in which he asserted that he had met the fundraising threshold, (2) CTEL’s third-quarter re- port, submitted on October 26, 1976, which indicated that, between January 1, 1976, and September 30, 1976, CTEL had raised $71,463 in total contributions, and (3) the computer printout, submitted on October 27, 1976, which listed contributions in excess of $5,000 in each of 20 states. It was obvious from the face of these submissions, especially the computer printout, that if La Rouche had surpassed the fundraising threshold, he had done so only by a narrow margin. This fact surely warranted the Commission in keeping a close eye on the sufficiency of the documentation of the contributions to La Rouche’s campaign, but it did not amount to a patent irregularity suggesting the possibility of fraud. Nor was it a patent irregularity that the computer printout raised the ques- tion whether certain contributions deposited after La Rouche was nominated on October 16, 1976, but report- edly received before that date, were in fact received be- 54a 28 fore the nomination. Accordingly, because the informa- tion on hand revealed no patent irregularities, the Commission was not warranted in conducting an investi- gation beyond the face of La Rouche’s threshold submis- sion. Rather than authorizing an audit of CTEL’s rec- ords, the Commission, which of course was under no obligation to certify La Rouche’s eligibility, simply should have awaited further submissions in support of his eligi- bility. Even though the Commission acted ultra vires in author- izing the audit of CTEL’s records, we regard this error as nonprejudicial. If the Commission followed the proper - course of awaiting a further submission from La Rouche and if La Rouche had in fact submitted the requisite documentation under section 9033(b) (3)-(4), the docu- mentation would have contained, as the Commission audit revealed, patent irregularities that surely would have warranted an inquiry beyond the face of the threshold submissions. Those irregularities were numerous in- stances of contributions by money orders and cashier’s checks that raised substantial questions as to whether the contributions were made by residents of the states indi- cated. See note 7 supra. Therefore, because these irregu- larities would have been uncovered in any event if La Rouche had submitted the requisite documentation under ‘section 9038(b) (3)-(4), we sustain the Commission’s audit, even though unauthorized by statute, as nonpre- judicial error.** See Administrative Procedure Act § 10 21 The appropriate remedy in a case where the Commission wrongfully seeks to conduct an audit or field interviews dur- ing the certification process is a petition for review in this court. See 26 U.S.C. §§ 9086(a), 9041(a) (1976). Section 9041(a) provides that: Any agency action by the Commission made under the provisions of this chapter shall be subject to review by the United Staves Court of Appeals for the District of Colum- 55a 29 (e), 5 U.S.C. § 706 (1976) (“due account shall be taken of the rule of prejudicial error”). The Commission, once confront-< with these patent irregularities, was warranted, we cnink, in taking further investigatory action. It was neither unreasonable nor in excess of statutory authority for the Commission, in light of the questions raised by the money orders and cashier’s checks about the states in which certain contributors resided, to authorize field interviews of CTEL contribu- tors to verify their donations to La Rouche’s campaign,” bia Circuit upon petition filed in such court within 30 days after the agency action by the Commission for which review is sought. A Commission decision to conduct an investigation during the certification process on the ground that a candidate’s thresh- old submission contains patent irregularities is, we think, “agency action” within the meaning of section 9041 (a). 22 Petitioners challenge the legality of the field interviews on the ground that they were not authorized by majority vote of the Commission as required by 2 U.S.C. § 487c(c) (1976). Section 437c(c) provides in relevant part: All decisions of the Commission with respect to the exercise of its duties and powers under the provisions of this subchapter shall be made by a majority vote of the members of the Commission. .. . A member of the Com- mission may not delegate to any person his vote or any decisionmaking authority or duty vested in the Commis- sion by the provisions of this subchapter. It is petitioners’ position that the Commissioners never voted at all on this matter, but simply raised no objection to a staff memorandum recommending that the filed interviews be con- ducted and stating that “[i]f no objection is raised within 24 hours, the staff will proceed as outlined above.” P.A. 24. This argument, we think, falls short of the mark, for sec- tion 437c(c) requires only that a majority vote be taken, not that it be taken in any specified manner. The record reveals that the Secretary of the Commission distributed the staff memorandum to the six Commissioners on January 138, 1977, 56a 30 nor was it error, given the aforementioned irregularities and the pattern of last-minute contributions from volun- teer co-ordinators of an organization closely related to CTEL, to authorize an audit of the books of that and other such organizations. Both the field interviews, which focused on contributions reported in three representative states, and the expanded audit, which focused on the books of those organizations closely related to CTEL, were properly circumscribed in the sense that they were reasonable investigatory responses to the irregularities uncovered in the initial audit. As a final matter, we think that the Commission acted properly when, on February 7, 1977, it formally re- jected La Rouche’s application for matching funds on the ground that he had not established his eligibility under section 9033(b)(3)-(4). Petitioners argue that La Rouche establisked his eligibility on February 2, 1977, when CTEL submitted to the Commission the documen- tation of contributions found lacking in the initial audit of CTEL’s books. This argument falls short of the mark, however, because it misconceives the appropriate legal standard. The issue before the Commission where, as here, patent irregularities are discovered in the docu- mentation underlying the contributions to a candidate is not whether the candidate has documentation to estab- lish that he has raised the threshold amount, but rather that five of the six Commissioners returned the memorandum the next day without objection, and that the sixth Commis- sioner who did not return the memorandum nevertheless raised no objection to the proposed action. A. 59-60. On the basis of this response, the Secretary of the Commission, on January 14, 1977, certified that the Commission had adopted the staff proposal. P.A. 25. It is our view that given the fact . that five Commissioners returned the memorandum without objection, the staff recommendation was adopted by “major- ity vote” within the meaning of section 437c(c). Nothing in that provision forbids the Commissioners from voting, as they did here, by means of memoranda. 57a 31 whether the candidate in fact has met the fundraising threshold. In rejecting La Rouche’s application, the Commission relied on the results of the field interviews of CTEL contributors in Delaware, Massachusetts, and Wisconsin. Those interviews indicated that, in both Delaware and Wisconsin, La Rouche had failed to raise the requisite amount. In Delaware, where the initial audit indicated that La Rouche had exceeded the $5,000 threshold by only $36.75, the field interviews revealed that $420 of. that total had been contributed from funds not belonging to the listed contributors. Such funds obviously are not “contributions” within the meaning of the Act, see 26 U.S.C. § 9084(a) (1976), for to hold otherwise would render meaningless the requirement of section 9033 (b) (4) that only $250 per person be counted toward the threshold amount. In Wisconsin, where the initial audit indicated that La Rouche had exceeded the fund- raising threshold by only $172.62, one listed contributor denied altogether having made a $250 contribution and two others confirmed only a portion ($125) of their reported contributions ($365).- Thus, inasmuch as La Rouche plainly fell short of the threshold amount in at least two of the twenty states involved,™ we conclude 23 Although we hold today in No. 77-2093 that the agents of the Commission may have exceeded their statutory authority during the field interviews in asking certain questions regard- ing the contributors’ political beliefs and may even have vio- lated the fourth amendment in procuring financial documents and bank records from one contributor in particular, Jones v. Federal Election Commission, No. 77-2098, slip op. at 30-34, . (D.C. Cir. August 23, 1979), we do not believe that our hoid- ing in No. 77-2093 renders suspect the reliability of the re- sults of the field interviews. Nor in fact do petitioners have di- rectly dispute the results of the field interviews. Accordingly, in the instant case, we rely on those results in affirming the Commission’s refusal to certify La Rouche’s eligibility to re- ceive matching funds. 58a erat Acne ae 32 that the Commission did not err in refusing to certify La Rouche’s eligibility to receive matching funds on the ground that he failed to satisfy the fundraising threshold of section 9033 (b) (8)-(4).** *4 Petitioners also argue that they have been denied equal protection under the fifth amendment, insofar as the Com- mission singled out La Rouche for different and unusual treat- ment in rejecting his application for primary matching funds. The short answer to this argument is that the record reveals that La Rouche’s application for matching funds was the only application during the 1976 election that raised any sub- stantial question as to whether the fundraising threshold had~ been met. In the absence of any evidence of a pattern of harassment or bad faith on the part of the Commission, we see no basis for finding an equal protection violation simply because the Commission accorded unique treatment to a unique application. Nor is this “[a] statutory scheme that blocks minority party access to the electoral process [and thereby] unjustifiably in- vades the right to vote and to associate.” Doe v. Martin, 404 F. Supp. 753, 759-60 (D.D.C. 1975) (three-judge court) (foot- me arate As the Supreme Court in Buckley v. Valeo noted: Subtitle H [which includes the Act] does not prevent any candidate from getting on the ballot or any voter from casting a vote for the candidate of his choice; the inabil- ity, if any, of minor-party candidates to wage effective campaigns will derive not from lack of public funding but — from their inability to raise private contributions. Any disadvantage suffered by operation of the eligibility for- mulae under Subtitle H is thus limited to the claimed denial of the enhancement of opportunity to communicate with the electorate that the formulae afford eligible can- didates. But eligible candidates suffer a countervailing denial. As we more fully develop later, acceptance of public financing entails voluntary acceptance of an ex- penditure ceiling. Non-eligible candidates are not subject to that limitation. Accordingly, we conclude that public financing is generally less restrictive of access to the electoral process than the ballot-access regulations dealt with in prior cases. In any event, Congress enacted Sub- 59a 33 IV It is our view, in sum, that Congress intended to create a certification mechanism designed to ensure both that frivolous candidates are denied primary matching funds and that eligible candidates are paid such funds promptly. Our construction of section 9083 (b) (3)-(4) and section 9086(a) reflects these two policies. The first policy is served by our holding that a candidate seeking to estab- lish his eligibility under section 9033(b) (3)-(4) must satisfy the Commission that he has the requisite docu- mentation to establish his compliance with the funcraising threshold. The second policy is served by our holding that the Commission, in passing on the eligibility of a candidate, must restrict its inquiry under section 9036 (a) to the face of the candidate’s threshold submission except where that submission (or that submission to- gether with other documents on file with the Commission) contains patent irregularities suggesting the possibility of fraud. : There is no question but that, under the legal stan- dards outlined above, the Commission, in October 1976, acted properly in not approving La Rouche’s application for matching funds, inasmuch as his threshold submis- sions fell far short of the documentation required to establish his eligibility. The proper course of action at — this juncture would have been to await the submission _ of additional documentation. Instead, the Commission, absent the requisite finding of patent irregularities on the face of the initial submissions, chose to conduct an audit title H in furtherance of sufficiently important govern- mental interests and has not unfairly or unnecessarily burdened the political opportunity of any party or candidate. 424 U.S. at 94-96 (footnotes omitted). For the same reasons, we find no constitutional infirmity in the certification proce- dure outlined above at least as regards La Rouche. ne OI a a 34 of CTEL’s books. This error, we think, was nonprejudi- cial, however, because if the Commission had awaited the requisite documentation, it would have contained, as the audit revealed, patent irregularities of the sort that surely would have warranted an audit of CTEL’s books. It is our view that the Commission, once confronted with these irregularities, acted both reasonably and within the scope of its statutory authority in conducting a further investigation and finally in rejecting, on the basis of that investigation, La Rouche’s application for match- ing funds. Accordingly, we affirm the decision under review. ; It is so ordered. 6la [Logo of the Federal Election Commission] October 21, 1976 Mr. Lyndon H. LaRouche, Jr. Committee to Elect Lyndon LaRouche P.O. Box 1972, GPO New York, New York 10001 Dear Mr. LaRouche: This leiter is in response to your certification to the Commission for eligibility for Presidential Primary Matching Funding. Prior to conducting an audit of your threshold submission, the Commission raises several pre- liminary questions. The Presidential Primary Matching Funding is provided to candidates seeking Presidential nomination for a polit- ical party in primary elections. Primary election is defined in 26 U.S.C. Section 9032(7) to mean: .. an election, including a runoff election or a nominating convention or caucus held by a political party, for the selection of delegates to a national nominating convention of a political party, or for the expression of a preference for the nomination of persons for election to the office of President of the United States. : The limitation of the public funding to candidates running in party primaries was upheld by the Supreme Court in Buckley v Valeo, 424 U.S. 1 (1976). Accordingly, we request your submission of a listing of all party primaries in which you were a candidate for the nomination of the U.S. Labor Party for the 1976 election. An additional question concerns the determination of your matching payment. This term is defined in 26 U.S.C. Section 9032(6) to mean: ... the period beginning with the beginning of the calendar year in which a general election for the 62a AO a A AE A EO, SCORE office of President of the United States will be held and ending on the date on which the national con- vention of the party whose nomination a candidate seeks nominates its candidate for the office of Presi- dent of the United States, or, in the case of a party which does not make such nomination by national convention, ending on the earlier of— (A) the date such party nominates its candidate for the office of President of the United States; or (B) the last day of the last national convention held by a major party during such calendar year. To assist the Commission in determining the matching payment period, we would appreciate your providing answers to the following questions: (1) Are you listed on any State ballots for the 1976 election as the Presidential nomin [Text truncated at 120,000 characters. The full text is on the page linked above.] --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385006_1279%3A1. Public record. Not legal advice.