States v. Helstoski, 635 F.2d 200 (3d. Cir. 1980), recognized, On September 25, 1981, the Speaker of the House of Representatives, Thomas P. O'Neill, Jr., the Majority Leader of the House, Jim Wright, and the Republican Leader of the House, Robert H. Michel, filed a brief, amici curiae, urging the Supreme Court to grant Rep. Carney's petition for a writ of certiorari. The amici also argued that there was a conflict between the circuits regarding the standards governing the dismissal of an indictment on Speech or Debate Clause grounds. Furthermore, the amici asserted that there was a second conflict between the circuits regarding the appealability of a denial of a Congressional defendant's motion to permit inspection of grand jury minutes. While the District of Columbia Circuit had flatly held that the district court's ruling on Rep. Carney's access motion was unappealable, the amici pointed out that the Second Circuit in United States v. Williams, supra, specifically, provided appellate review of a district court's pre-trial denial of a motion for access to grant jury minutes. In the amici's view, the court of appeals decision-on both the substantive and evidentiary issues-raised important questions of Federal constitutional law which had not been, but should be, decided by the Supreme Court. This was especially so, they argued, because the Speech or Debate Clause was implicated. "The Speech or Debate Clause is a fundamental part of our structure of government and is entitled to more 'sensitivity' than that accorded by the meager court of appeals rulings," the amici concluded in their brief. [Brief of the Honorable Thomas P. O'Neill, et al. in Support of Petition for Writ of Certiorari, September 25, 1981, at 13] On November 5, 1981, the Government filed its brief in opposition to Rep. Carney's petition. The brief rejected the contention that there was a conflict between the circuits regarding the dismissal of an indictment of Speech or Debate Clause grounds. "[I]n the present case there has been no showing of any basis for concluding that Speech or Debate Clause materials were presented to the grand jury at all, let alone that, as in Helstoski, they pervasively permeated that body's inquiry." [Brief for the United States in Opposition, November 5, 1981, at 7] The Government also argued that the appeals court had properly ruled on the evidentiary and grand jury access issues since the lower court orders were not final. On November 30, 1981, the Supreme Court denied Rep. Carney's petition for a writ of certiorari. [454 U.S. 1081] The criminal trial began in the district court on November 16, 1981 and continued until November 23. On that date, after the Government had concluded its case and before the jury began its deliberations, Rep. Carney moved for a judgment of acquittal and the motion was granted by Judge Bryant. Status-The case is closed. The complete text of the June 29, 1981 decision of the circuit court is printed in the "Decisions" section of this report at page II. Civil Liability for Criminal Offenses United States v. Eilberg Civil Action No. 79-1623 (E.D. Pa.) and No. 81-1693 (D.D.C.) In October 1978, U.S. Representative Joshua Eilberg of Pennsylvania was indicted under a Federal conflict of interest statute. In February 1979, Rep. Eilberg pled guilty to the charge and was fined $10,000 and placed on probation for five years. (See page 45 of Court Proceedings and Actions of Vital Interest to the Congress, September 1, 1979 for a discussion of that case.) As a follow-up to that criminal prosecution, the Government filed a civil action against Rep. Eilberg on May 7, 1979 in the U.S. District Court for the Eastern District of Pennsylvania. The Government's complaint contained three counts. The first count alleged that from June 1975 through 1976 the defendant, while a Member of Congress, was also a member of the law firms known as "Eilberg, Corson, Getson and Abramson" and "Corson, Getson and Abramson". The Government claimed that these firms represented Hahnemann Medical College and Hospital of Philadelphia ("Hahnemann") in its attempt to obtain a $14.5 million grant from the Community Services Administration, an Executive branch agency. As a result of this representation, Rep. Eilberg received legal fees in the approximate amount of $35,172, which constituted his distributive share of the entire legal fee paid by Hahnemann. By representing Hahnemann, the Government asserted, Rep. Eilberg placed himself in a conflict of interest and breached his fiduciary duty to the United States, in violation of 18 U.S.C. § 203. This statute, which is the same statute Rep. Eilberg was convicted under in the earlier criminal action, makes it a crime for any member of Congress, except as provided by law, to receive compensation for services rendered in any proceeding, before a Federal agency or department, in which the United States has a substantial interest. Count II repeated the allegations of Count I and further charged that the defendant violated his agency relationship with the Government, breached his implied contract of employment, and was unjustly enriched, again in violation of 18 U.S.C. § 203. Count III alleged that during the period from May 1973 through January 1978, Rep Eilberg used, and permitted his family and friends to use, his official telephone credit card to charge personal calls to the House of Representatives. Allegedly, the defendant, for each of 57 consecutive months, falsely and knowingly certified to the Clerk of the House that all calls charged to his official credit card and billed to the House by the phone company were made in the course of his Congressional duties, when in reality they were not. Such acts were said to constitute violations of 31 U.S.Č. § 231 (False Claims Act) which provides, in pertinent part: Any person * who shall make * * know or present makes [or] uses * * * * * knowing the same to contain any fraudulent statement or entry, * shall forfeit and pay to the United States the sum of $2,000, and in addition, double the amount of damages which the United States may have sustained * Under Counts I and II the Government asked the court to deem the defendant's $35,172.00 legal fee as being held in constructive trust with the United States as the beneficiary. Under Count III the Government requested that the court order Rep. Eilberg to pay $2,000 for each of the 57 alleged violations of the False Claims Act, plus double the Government's damages. In June 1979, Rep. Eilberg filed a motion to dismiss the complaint. As to Counts I and II, the defendant argued that the conflict of interest statute did not grant the Government a civil cause of action against him because a civil remedy should be implied from a criminal statute only when criminal liability is inadequate to ensure the full effectiveness of the statute. In the present case, said Rep. Eilberg, his Hahnemann legal fees were given to him by his law firm. Thus, since the only possible loss suffered was to his law partners, not the Government, the statute was given full effect when he was convicted of violating section 203 in the prior criminal proceeding. Further, if a civil cause of action did lie it would lie under the restitution statute, 18 U.S.C. § 3651(16)(2), not section 203. As to Count III, Rep. Eilberg asserted that his actions regarding personal phone calls did not constitute false claims within the meaning of the Act. He reasoned that the second clause of section 231 prohibits using fraudulent vouchers to obtain the payment of "such claim" and that the term "such claim" refers to, and means, a false claim as mentioned in the first clause. Thus, since the phone company's bill to the Clerk of the House was clearly not a false claim, using a fraudulent voucher to obtain payment for the phone bill would not violate the statute. Second, the defendant cited 2 U.S.C. § 95 which reads, in part, "Payments made upon vouchers approved by the Committee on House Administration of the House of Representatives, . . . are declared to be conclusive upon all the departments and officers of the Government." The word "conclusive," he said, precluded the Government from questioning the propriety of documents submitted by a Member in connection with payments made to a third party out of the contingency fund. Moreover, such questioning was also barred by the Speech or Debate Clause of the U.S. Constitution.1 In July 1979, Lawrence Corson and Allan Getson filed a motion for leave to intervene in the case as plaintiffs. They argued that as the defendant's former law partners they, and not the Government, would be entitled to any legal fees improperly received by Rep. Eilberg. Both the Government and the defendant opposed the motion for leave to intervene. Also in July, the Government filed its memorandum in opposition to the motion to dismiss. In defending Counts I and II, the Government stated that it was not asserting an implied right of The Speech or Debate Clause of the U.S. Constitution provides that "for any Speech or Debate in either House, [U.S. Senators and U.S. Representatives] shall not be questioned in any other Place." [art. I, § 6, cl. 1] action arising out of the defendant's conviction under 18 U.S.C. § 203. Rather, those counts were based on the common law which provides the Government with remedies for breach of a fiduciary duty by one of its agents. The Government also said that the purpose of Counts I and II was not to restore funds to the Government, but to enforce the loyalty of its agent. In response to Rep. Eilberg's challenge to Count III, the Government took the position that the term "such claim" refers to any claim, not just one which is false. Lastly, the plaintiff asserted that the use of the telephone was not a protected legislative activity under the Constitution and that the legislative history of 2 U.S.C. § 95 reflected no Congressional intent to bar a cause of action under the False Claims Act. In August 1979, the Government filed a motion for a determination of materiality and relevancy of documents called for in a subpoena to be issued to the Clerk of the House. Through the subpoena the Government would seek to obtain the defendant's telephone records from May 1973 through January 1978. This motion was opposed by the Clerk of the House on the grounds that the separation of powers and political question doctrines precluded the court from issuing a finding of materiality and relevancy for the documents in question. The Clerk also challenged the request as being overbroad and infringing upon the confidentiality of legislative branch records. Rep. Eilberg also opposed the Government's motion and adopted the arguments put forth by the Clerk. On February 1, 1980, a hearing was held by District Court Judge Louis H. Pollak on the outstanding motions, including the Government's motion for a determination of materiality and relevancy of documents. At this hearing, and in a subsequent memorandum filed on March 26, 1980, the Government disputed the Clerk's contention that the cause of action underlying the motion (involving the alleged telephone violations of the False Claims Act) was not a proper case or controversy for judicial determination in view of the separation of powers and political questions doctrines (since it would require the court to inquire into whether phone calls were "official"). In its memorandum, the Government argued that all of the positions previously taken by the parties must be "re-evaluated" in light of a "newly-discovered" statute, 2 U.S.C. §46(g), which provides, in relevant part, that "there shall be paid out of the contingent fund . . ., in accordance with regulations prescribed by the Committee on House Administration, such amounts as may be necessary to pay-(1) toll charges on strictly official long-distance telephone calls... made or sent by or on behalf of each Member not to exceed seventy-thousand units for each session. . . ." The Government contended that by enacting such a law, Congress had made the "strictly official" limitation on telephone usage by Members the "law of the land," thereby permitting the executive and judicial branches to investigate Members' telephone calls to ensure compliance with the law. The memorandum asserted that: Enforcement of a purely internal House rule by the executive and courts would be an encroachment on the powers of the House, a violation of separation of powers, and a violation of the textual commitment clause. But where the involvement of a House rule is only incidental to enforcement of Acts of Congress by the executive and courts, there are no such violations. Though Congress could have changed the law 5 to allow for payment of unofficial calls, it did not, and Mr. Eilberg and all other congressmen are bound by both 2 U.S.C. Section 46(g) and the False Claims Act. It is clear that plaintiff is proceeding to enforce Acts of Congress and not House rules. It is also clear that since the "official" distinction appears in an Act of Congress and not solely in a House rule, the court is being asked to interpret the meaning of a word in an Act of Congress, not in a House rule. 5 Though Congress could change the law just as it could change a House rule, it would not be so simple a process. Instead of a matter for the House Committee on Administration, or the Speaker, it becomes a matter for the full Senate, and the Presidential veto power, and all under the scrutiny of the public eye on legislation. [Plaintiff's Reply to Memorandum filed by the Clerk of United States House of Representatives, March 26, 1980, at 4-5] Under this theory, the Government maintained, punishment was not "textually committed" to the House, since Rep. Eilberg's behavior allegedly violated a statute as well as a House rule. "When behavior breaks both a rule and a statute," the memorandum contended, "the executive and courts may proceed on the statute." [Id. at 5] Over the next several months the Government and the Clerk engaged in a debate by memoranda over the relevance and effect of 2 U.S.C. § 46(g). The Clerk interposed three major objections to the applicability of the statute. First, he argued, the statute was no longer valid law, having been superseded in effect by numerous House Administration Committee Orders (issued pursuant to its statutory authority under 2 U.S.C. § 57(a)) which varied the terms of the telephone allowance. Second, he maintained, even if the statute was not a nullity, the Committee had virtually abandoned it for purposes of regulating the telephone allowance. Finally, he contended, the legislative history of 2 U.S.C. § 57 revealed no intent to do anything other than apportion responsibility between the full House and the Committee on House Administration regarding allowances, and did not support the contention that the Government was to be involved in the regulation of the House allowance system. In rebuttal, the Government asserted that the Committee had exercised its authority under 2 U.S.C. § 57 only to regulate changes in the amounts of allowances, and it did not thereby render the "strictly official" limitation contained in 2 U.S.C. § 46 a nullity. On June 26, 1980, District Judge Pollak granted the July 1979 motion of Lawrence Corson and Allan Getson, Rep. Eilberg's former law partners, to intervene in the case. In a memorandum accompanying the order, Judge Pollak ruled that the existing parties clearly would not represent the interests of Messrs. Corson and Getson, that they had "an interest in" the property that was the subject of the suit (the distributive share of the law firm's fee paid by Hahnemann), and that their ability to protect that interest |