Why The Hillary Clinton Campaign Can’t Hide 38 Documents From The Special Counsel

Documents made public last week by the Federal Election Commission reveal that Hillary Clinton campaign payments to Fusion GPS to dig up dirt on Donald Trump were not treated as legal expenses. These newly released documents eviscerate the Democratic National Committee and Clinton campaign’s attempts to hide behind attorney-client privilege in the special counsel’s criminal case against former Clinton campaign attorney Michael Sussmann.

Sussmann, who awaits trial in a D.C. federal court later this month on the charge that he made a false statement to former FBI General Counsel James Baker, is currently fighting to keep prosecutors from seeing 38 documents withheld from the grand jury based on claims of attorney-client privilege. In early April, Special Counsel John Durham’s team filed a motion to compel those secreting the documents to provide them to the court to allow the judge to assess, in camera, whether they were properly withheld. In response, Sussmann argued the special counsel had waited too long to force the issue and that his criminal case was the wrong forum to litigate the question.

The day after the former Clinton campaign attorney filed his response opposing in camera review of the material, his “fellow Spygate hoaxers sought to join in Sussmann’s efforts to keep the documents concealed” by seeking to intervene in the case. Last week, the trial court granted the flurry of motions to intervene, authorizing tech executive Rodney Joffe, Fusion GPS, Perkins Coie, the DNC, and the Clinton campaign to file briefs opposing disclosure of the documents.

On Wednesday the court will hear oral arguments on the special counsel’s motion and decide whether the 38 documents must be turned over, initially to the court and then eventually to prosecutors. While Durham’s team previously had a strong case that the documents were not protected by attorney-client privilege, a document dump last week by the FEC further strengthens the prosecutor’s position.

A little more than a month ago, news broke that the FEC had fined the DNC and the Clinton campaign more than $100,000 related to those organizations’ reporting of fees paid in 2016. Those fees were paid to Fusion GPS for opposition research but marked on financial disclosures as legal expenses remitted to its law firm, Perkins Coie. Until Thursday, however, the basis for the FEC’s conclusion that probable cause existed that the DNC and Clinton campaign had misreported the purpose of those disbursements remained buried in the bureaucracy.

The now-released file about the FEC’s investigation into the DNC and the Clinton campaign contains a bevy of material. It includes, most relevantly, memoranda prepared by the FEC’s Office of General Counsel and approved by the FEC.

The memoranda conclude that probable cause supports a finding that both the Clinton campaign and the DNC misrepresented the purpose of the payments to Fusion GPS. While the political organizations reported the payments to Fusion GPS as “legal services” or “legal and compliance consulting,” the FEC concluded probable cause existed that the expenses instead related to opposition research.

The memoranda—one issued related to the DNC and the second addressing the complaint against the Clinton campaign—begin with the FEC general counsel’s office reciting the now well-known facts, beginning with the players. Perkins Coie served as general counsel for the DNC during the 2016 election cycle, the memoranda say. Then, in April 2016, Perkins Coie hired Fusion GPS to perform “a variety of research and consulting services.” The memoranda then recount the evidence the FEC general counsel reviewed, which “included invoices, account statements, copies of checks, and wire transfers.”

That evidence, the FEC concluded, showed “the DNC paid Fusion $777,907.97 for opposition research” while reporting the work as “legal and compliance consulting.” Similarly, the FEC concluded the Clinton campaign inaccurately reported $175,000 of payments to Fusion GPS for opposition research as “legal services.”

Rather than fight the FEC’s conclusion, the DNC and Clinton campaign entered settlement agreements with the agency, agreeing to pay a fine and refrain from similar violations in the future. While not conceding the violations found by the FEC, the DNC and the Clinton campaign nonetheless agreed they would “not further contest the Commission’s findings.”

After the DNC and the Clinton campaign filed their motions to intervene in the Sussmann case, the attorney for The Coolidge Reagan Foundation—the organization that had filed the complaints against the DNC and the Clinton campaign with the FEC—dispatched a three-page letter to the special counsel’s office. The foundation’s letter from its counsel Dan Backer summarized the key details about the FEC’s recent decision, then suggested the DNC and Clinton campaign’s agreement not to “further contest the Commission’s findings” should prevent them from asserting attorney-client privilege in the Sussmann case.

“The Government should not permit HFA and the DNC to adopt conflicting positions in different proceedings, depending on the federal agency against which they are litigating,” the foundation argued, adding that the trial court may find those breaches of the settlement agreement “material in ruling on any privilege claims.”

While the special counsel’s office made no mention of the FEC’s findings in its response to the DNC and the Clinton campaign’s filings, the foundation’s letter to Durham highlighted a second point that now proves prescient. In his letter, Backer noted that although the FEC memoranda “will not be made public for another week,” the details uncovered in the FEC investigation will likely be useful to the special counsel in attempting to counter the claims of attorney-client privilege pushed in the Sussmann litigation.

Indeed, the FEC memoranda released last week provide additional evidence countering the DNC and the Clinton campaign’s claims of privilege not previously highlighted in the special counsel’s briefing.

For instance, the Clinton campaign reported payments of $175,000 to Perkins Coie as payments for “legal services,” but the FEC memorandum stressed that the Perkins Coie invoices did not treat all of the charges as related to “legal services.” Rather, the invoices reviewed by the FEC showed that in billing the Clinton campaign Perkins Coie distinguished between fees for “legal services rendered” and fees for “professional services — other.” The only service billed as “legal services rendered,” the FEC noted, related to the $5,000 monthly retainer fee paid to Perkins Coie. Conversely, all of the charges related to Fusion GPS’s work charges appeared as “professional services—other.”

The FEC memorandum also stressed that the invoices Fusion GPS sent to Perkins Coie for the services rendered on behalf of the Clinton campaign listed “a monthly retainer fee plus additional fees labeled as ‘Russia Research’ or ‘Russian language researcher.’” Those Fusion GPS charges included payments “Fusion made to its sub vendors, Nellie Ohr, Graham Stack, Edward Austin Limited, and Orbis Business Intelligence Ltd.” The sub-vendors all conducted opposition research for Fusion GPS related to Trump, the FEC memorandum explained, again countering the proposition that the subcontractor and its vendors were assisting Perkins Coie in providing legal services to the Clinton campaign.

Similarly, the FEC memorandum discussing the charge against the DNC noted that it reported paying Perkins Coie $66,500 on August 16, 2016, for “Research Consulting,” while later invoices categorized the payments to Perkins Coie as fees for “legal and compliance consulting.” The FEC found the initial category of “research consulting” captured the accurate purpose of the expenditures and indicated the DNC realized “research consulting” represented the more appropriate classification of the expenses

The invoices also showed that Perkins Coie charged the DNC for the entire portion of the fees invoiced by Fusion GPS. This fact suggested Perkins Coie served as simply a pass-through entity for Fusion GPS’s opposition research. This concerned the commissioners, as a transcript of the hearing made clear: Merely running bills through a law firm could not convert them into legal expenses, the commissioners stressed.

While the FEC’s analysis of the payments to Fusion GPS focused on whether the DNC and the Clinton campaign properly reported the purpose of the expenses, and not on whether an attorney-client relationship existed for purposes of privilege, the evidence discussed provides the special counsel additional ammunition to argue in support of an in camera review of the documents, and their eventual disclosure to prosecutors.

No matter how the court resolves the issue of attorney-client privilege, though, the FEC’s memoranda expose the Clinton campaign and the DNC’s attempts to hide their funding of the Russia collusion hoax. When the Sussmann trial begins later this month, the country will learn even more details of the breadth and depth of the conspiracy when those behind the Alfa Bank hoax testify—with or without the 38 documents now in dispute.

Margot Cleveland is The Federalist’s senior legal correspondent. She is also a contributor to National Review Online, the Washington Examiner, Aleteia, and Townhall.com, and has been published in the Wall Street Journal and USA Today.

Cleveland is a lawyer and a graduate of the Notre Dame Law School, where she earned the Hoynes Prize—the law school’s highest honor. She later served for nearly 25 years as a permanent law clerk for a federal appellate judge on the Seventh Circuit Court of Appeals. Cleveland is a former full-time university faculty member and now teaches as an adjunct from time to time.

As a stay-at-home homeschooling mom of a young son with cystic fibrosis, Cleveland frequently writes on cultural issues related to parenting and special-needs children. Cleveland is on Twitter at @ProfMJCleveland. The views expressed here are those of Cleveland in her private capacity.

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