O’Donnell, Mulling Appeal, Asks to Delay Paying Fine

By Kenneth P. Doyle

Former Senate candidate Christine O’Donnell, who along with her campaign committee was ordered pay more than $30,000 for violating laws barring personal use of campaign money, has asked a federal judge for more time to decide whether to appeal or file additional motions.

Judge Leonard P. Stark of the U.S. District Court for the District of Delaware ordered the Federal Election Commission to respond to O’Donnell’s request by May 9, with a reply due from O’Donnell’s lawyers by May 12 ( FEC v. O’Donnell, D. Del., No. 15-17, order 5/28/17).

O’Donnell has battled FEC enforcement action for years over the personal-use issue. When O’Donnell refused to settle an administrative enforcement action, the FEC filed a civil enforcement lawsuit in federal court.

In 2010, the conservative activist, who identified with the Tea Party wing of the GOP, defeated veteran Rep. Mike Castle (R-Del.) in a Senate primary to become to Republican Senate nominee in Delaware. O’Donnell lost the general election that year to Sen. Chris Coons (D-Del.).

Personal Use Ban Said Unconstitutional

An 11-page motion filed by O’Donnell’s lawyers on May 3 argued that FEC regulations that barred the candidate from using campaign money to pay her rent were unconstitutional. The motion said O’Donnell needed more time to hire appellate lawyers and file a notice of appeal and other motions.

The latest O’Donnell motion was signed by attorney Stephen M. Hoersting of the law firm The Gober Group PLLC, who has represented O’Donnell before the federal district court in Wilmington, Del. The motion said O’Donnell and her campaign committee “have always contended” that the FEC’s personal use regulation barring a campaign from paying a candidate’s rent violates the First Amendment.

“If the appellate courts follow the examples of McCutcheon v. Federal Election Commission and Citizens United v. Federal Election Commission, the $4,620 ordered disgorged plus $1,081.85 in pre-judgment interest and penalty of $25,000 should never be paid at all,” the motion contended. “It would be unjust to have the Defendants pay now and then get a refund years later.”

The Supreme Court rulings that the motion referred to struck down as unconstitutional long-standing limits on campaign contributions and spending.

“Ms. O’Donnell is taking steps to preserve her right to appeal,” Hoersting told Bloomberg BNA in an email. Beyond that, he said, she had no comment at this time.

Judge Rejected O’Donnell Arguments

Judge Stark last month ordered O’Donnell to disgorge $5,701.85 to the U.S. Treasury and said she and her campaign committee would be equally responsible for paying an additional $25,000 fine assessed by the FEC for violating the rules on personal use of campaign money.

The disgorgement order correlated to the rent payments saved by O’Donnell when she lived in an apartment paid for by her Senate campaign. The apartment also served as her campaign headquarters.

The judge, in a memorandum opinion, rejected O’Donnell’s contention that she acted in good faith and believed the Federal Election Commission rules allowed her actions.

Stark ruled last September that O’Donnell had illegally used campaign funds to pay her rent and utilities in 2010 and 2011. The judge rejected arguments by O’Donnell’s lawyers that legal restrictions on personal use of campaign funds are unconstitutional because campaign money is equivalent to free speech.

The liberal watchdog group Citizens for Responsibility and Ethics in Washington (CREW) filed the original FEC enforcement complaint against O’Donnell. The FEC investigated the matter and filed a civil enforcement lawsuit against O’Donnell in 2015, alleging that she illegally used at least $20,000 in campaign funds for personal expenses. The expenses included rent and utilities for the Greenville, Del., townhouse where she lived and ran her campaign.

To contact the reporter on this story: Kenneth P. Doyle in Washington at kdoyle@bna.com

To contact the editor responsible for this story: Paul Hendrie at pHendrie@bna.com

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