[House Report 111-320]
[From the U.S. Government Publishing Office]


   111th Congress 1st 
         Session        HOUSE OF REPRESENTATIVES        Report
                                                       111-320
_______________________________________________________________________

                                                 House Calendar No. 126
 
                            IN THE MATTER OF
                       REPRESENTATIVE SAM GRAVES

                               ----------                              

                              R E P O R T

                                 of the

                       COMMITTEE ON STANDARDS OF
                            OFFICIAL CONDUCT






  October 29, 2009.--Referred to the House Calendar and ordered to be 
                                printed




               COMMITTEE ON STANDARDS OF OFFICIAL CONDUCT

ZOE LOFGREN, California              JO BONNER, Alabama
  Chair                                Ranking Republican Member
BEN CHANDLER, Kentucky               MIKE CONAWAY, Texas
G.K. BUTTERFIELD, North Carolina     CHARLES DENT, Pennsylvania
KATHY CASTOR, Florida                GREGG HARPER, Mississippi
PETER WELCH, Vermont                 MICHAEL McCAUL, Texas

                              REPORT STAFF
             R. Blake Chisam, Chief Counsel/Staff Director
                  C. Morgan Kim, Deputy Chief Counsel
                    Dan Taylor, Counsel to the Chair
        Todd Ungerecht, Counsel to the Ranking Republican Member
                           Tom Rust, Counsel
                         Sheria Clarke, Counsel
                   Frank Davies, Senior Investigator
                         LETTER OF TRANSMITTAL

                              ----------                              

                          House of Representatives,
                Committee on Standards of Official Conduct,
                                  Washington, DC, October 29, 2009.
Hon. Lorraine C. Miller,
Clerk, House of Representatives,
Washington, DC.
    Dear Ms. Miller: Pursuant to clauses 3(a)(2) and (b) of 
rule XI of the Rules of the House of Representatives, we 
herewith transmit the attached Report, ``In the Matter of 
Representative Sam Graves.''
            Sincerely,
                                   Zoe Lofgren,
                                           Chair.
                                   Jo Bonner,
                                           Ranking Republican Member.
                           EXECUTIVE SUMMARY

    After a three-month review, the Committee on Standards of 
Official Conduct (Standards Committee) has concluded that 
Representative Sam Graves did not violate any U.S. House of 
Representatives rule or standard of conduct for his role in 
inviting a witness, Brooks Hurst, to testify before the 
Committee on Small Business on March 4, 2009.
    The Standards Committee considers the matter against 
Representative Graves closed, and no further inquiry is 
warranted. The question of whether Representative Graves 
violated any House rule or standard of conduct was referred to 
the Standards Committee by the Office of Congressional Ethics 
(OCE) on August 6, 2009.
    At issue was a financial connection between Mr. Hurst, who 
is a friend of Representative Graves, and Representative 
Graves' wife. Both are investors in two renewable fuel 
cooperatives, Golden Triangle Energy Cooperative (Golden 
Triangle) and Biofuels LLC (Biofuels). Representative Graves 
approved of Mr. Hurst as a witness. At the hearing, Mr. Hurst, 
representing the Missouri Soybean Association, advocated on 
behalf of the members of the association, and not for either of 
the entities in which Representative Graves' wife owns an 
interest.
    OCE's report and findings did not assert that 
Representative Graves violated any House rule or standard of 
conduct, but suggested that his actions created an ``appearance 
of a conflict of interest.''
    The Standards Committee found that no relevant House rule 
or other standard of conduct prohibits the creation of an 
appearance of a conflict of interest when selecting witnesses 
for a committee hearing. In addition, neither the Standards 
Committee nor OCE identified any evidence that the March 4, 
2009, hearing or Mr. Hurst's testimony resulted in any action 
that could benefit Representative Graves, Mrs. Graves, or Mr. 
Hurst.
    But the appearance question highlights the importance of 
financial disclosure statements. Representative Graves' 
financial disclosure statements fully and accurately reflect 
his financial interests, including his wife's 0.18% interest in 
Golden Triangle and 0.125% interest in Biofuels. Separately, 
Mr. Hurst fully complied with all disclosure requirements for 
witnesses. The Standards Committee learned that Mr. Hurst had a 
0.5% interest in Golden Triangle and a 0.33% in Biofuels.
    Members are required to disclose assets on the principle 
that conflicts of interest are best resolved by the political 
process. Timely filing of accurate financial disclosure 
statements is fundamental to the House ethics system. Any 
financial connection between Representative Graves and Mr. 
Hurst appears tenuous, but in this case, the public has the 
information to make such judgments.
    The process for inviting Mr. Hurst to testify--and the 
criteria used to select him as a witness--followed normal 
procedure of the Committee on Small Business.
    Representative Graves was appointed the ranking member of 
the Committee on Small Business at the beginning of the 111th 
Congress. The Committee on Small Business's majority staff 
notified the minority staff, approximately one week before the 
hearing, that the committee would hold a hearing on March 4, 
2009.
    The hearing involved no legislation that would ultimately 
come to the House floor, and was held solely as a fact-
gathering hearing about the impact of the current economic 
crisis on the renewable fuels industry. The minority staff 
established reasonable and objective criteria for choosing a 
potential witness, that he or she should be: (1) from 
Representative Graves' congressional district; (2) familiar 
with the renewable fuels industry; and (3) not employed by a 
company in which Representative Graves or his wife was 
invested.
    The decision regarding inviting witnesses was largely 
staff-driven. During the minority staffs deliberations, Paul 
Sass, Representative Graves' then-deputy chief of staff, sent 
an email to Representative Graves seeking input as to possible 
witnesses, and suggested Brooks Hurst among several 
possibilities. Representative Graves approved of Mr. Hurst as a 
possible witness. Mr. Hurst met each of the requirements for a 
witness. Although he held investments in the two cooperatives 
in which Representative Graves' wife was invested, he was not 
employed by either company.
    After further deliberations, the staff selected Mr. Hurst 
to testify at the hearing, and Mr. Hurst was one of five 
witnesses. The other four witnesses were selected by the 
majority on the Committee on Small Business. The Missouri 
Soybean Association prepared Mr. Hurst's written testimony and 
provided him with talking points for his oral testimony.
    The Graves investigation is one of the first matters to be 
referred by OCE and resolved by the Standards Committee. The 
Standards Committee regrets that it finds deficiencies in OCE's 
handling of this case, including procedural problems that are 
outlined in detail in this report.
    OCE's assertion that ``there is substantial reason to 
believe that an appearance of conflict of interest was 
created'' by Representative Graves was not supported by the 
facts in this case or the law.
    The Standards Committee reviewed Representative Graves' 
conduct under the House rules and standards identified by OCE 
and other House rules and standards of conduct. OCE reviewed 
Representative Graves' conduct pursuant to House Rule 3, clause 
1, House Rule 23, clause 2, and what it identified as ``House 
precedent regarding conflict of interest.''
    Based on the facts presented in OCE's report and findings, 
as well as the facts gathered by the Standards Committee's 
independent investigation, the Standards Committee concluded 
that none of the House rules or standards of conduct identified 
by OCE applied to Representative Graves' conduct.
    The Standards Committee determined that Representative 
Graves' conduct should more appropriately be analyzed under 
House Rule 23, clause 3, and Section 5 of the Code of Ethics 
for Government Service. Under those provisions, the Standards 
Committee concluded that Representative Graves' involvement 
with the witness selection process for the March 4 hearing did 
not violate any applicable House rule or standard of conduct. 
The Standards Committee also concluded that Mr. Hurst met all 
of the reasonable and objective requirements the Committee on 
Small Business minority staff established for a witness.
    Moreover, given Mr. Hurst's qualifications, the Standards 
Committee further concluded that even if Representative Graves 
had greater involvement in the selection process than he did 
have, he still would not have violated any applicable House 
rule or standard of conduct.
                                OVERVIEW

    This Report addresses the findings and conclusions of the 
Standards Committee with regard to the conduct of 
Representative Graves and OCE's review in this matter.
    Part I briefly summarizes the Standards Committee's 
findings and conclusions in this matter.
    Part II (summarized in Subpart A) contains the Standards 
Committee's factual findings, including a discussion of the 
Committee on Small Business's jurisdiction (Subpart B), the 
process by which Mr. Hurst was selected as a witness for the 
Committee on Small Business hearing (Subparts C, D, and E), the 
financial interest putatively shared by Mr. Hurst and 
Representative Graves (Subpart F), and the substance and 
results of Mr. Hurst's testimony before the Committee on Small 
Business (Subparts G and H).
    Part III contains the Standards Committee's statement of 
jurisdiction in this matter.
    Part IV contains the Standards Committee's legal analysis 
with regard to Representative Graves' conduct. The Standards 
Committee analyzed Representative Graves' conduct under the 
House rules and standards identified by OCE (Subpart A) and 
under additional House rules and standards identified by the 
Standards Committee (Subpart B).
    Part V contains the Standards Committee's conclusions and 
recommendation with respect to the conduct of Representative 
Graves.
    Part VI (summarized in Subpart A) addresses OCE's review, 
as well as the Standards Committee's investigation in this 
matter. Part VI summarizes pertinent sections of OCE's 
authorizing resolution and rules (Subpart B), and discusses the 
procedural history of OCE's review (Subpart C) and the nature 
of OCE's Report and Findings (Subpart D). In addition, Part VI 
summarizes both the Standards Committee's investigation in this 
matter (Subpart E.1) and a response to OCE's Report and 
Findings that Representative Graves submitted to the Standards 
Committee (Subpart E.2). Finally, Part VI provides the 
Standards Committee's findings with regard to certain 
regrettable deficiencies in OCE's review (Subpart F).
    Part VII of this Report contains the Standards Committee's 
statement under House Rule 13, clause 3(c).
                            C O N T E N T S

                              ----------                              
                                                                   Page
  I. Introduction.....................................................1
 II. Factual Findings.................................................1
        A. Summary of Factual Findings...........................     1
        B. The Jurisdiction of the Small Business Committee......     3
        C. Notification of the March 4, 2009, Small Business 
          Committee Hearing......................................     3
        D. Criteria for Selecting a Witness for the March 4, 
          2009, Small Business Committee Hearing.................     4
        E. Selection of Mr. Hurst for the March 4, 2009, Small 
          Business Committee Hearing.............................     5
        F. Financial Interest Putatively Shared by Brooks Hurst 
          and Representative Graves..............................     9
        G. Brooks Hurst and the March 4, 2009, Small Business 
          Committee Hearing......................................    10
        H. Actions Taken Following the Small Business Committee 
          Hearing................................................    11
III. Jurisdiction of the Standards Committee.........................12
 IV. Legal Analysis..................................................13
        A. Analysis Based on Rules Identified by OCE.............    13
        B. Analysis Based on Relevant Rules and Statutes.........    18
  V. Conclusions and Recommendations.................................20
 VI. OCE's Review....................................................21
        A. Summary of OCE's Review...............................    21
        B. OCE's Authorizing Resolution and Rules................    23
        C. Procedural History of OCE's Review....................    25
        D. OCE's Report and Findings.............................    26
        E. The Standards Committee's Investigation...............    28
        F. Findings and Conclusions Regarding Deficiencies in 
          OCE's Review...........................................    31
VII. Statement Under Rule 13, Clause 3(c) of the Rules of the House of 
     Representatives.................................................37
                                     

                            I. INTRODUCTION

    Following a unanimous vote, the Committee on Standards of 
Official Conduct (Standards Committee) submits this Report 
pursuant to House Rule 11, clause 3(a)(2), which authorizes the 
Standards Committee to investigate any alleged violation by a 
Member, officer, or employee of the House of Representatives, 
of the Code of Official Conduct or of any law, rule, 
regulation, or other standard of conduct applicable to the 
conduct of such Member, officer, or employee; and pursuant to 
House Rule 11, clause 3(b)(8)(A), which authorizes the 
Standards Committee to report on matters referred to the 
Standards Committee by the Office of Congressional Ethics 
(OCE).
    On August 6, 2009, OCE forwarded to the Standards Committee 
a report and findings (Report and Findings) recommending 
further review of allegations involving Representative Sam 
Graves. OCE's Report and Findings asserted that ``there is 
substantial reason to believe that an appearance of conflict of 
interest was created'' when Representative Graves invited a 
friend, Brooks Hurst, who held investments in the same 
renewable fuel cooperatives as Representative Graves' wife, to 
testify before a hearing of the House of Representatives 
Committee on Small Business (Small Business Committee) on 
issues facing the renewable fuels industry. OCE's Report and 
Findings did not assert that Representative Graves violated any 
current rule or standard of conduct.
    No relevant House Rule or other standard of conduct 
prohibits creation of an appearance of conflict of interest 
when selecting witnesses for a committee hearing. Thus, OCE did 
not find that Representative Graves violated any current House 
Rule or other standard of conduct.
    The Standards Committee's independent investigation also 
failed to conclude that Representative Graves violated any 
current House Rule or other standard of conduct. For this 
reason, the Standards Committee decided and reports that no 
further action should be taken with regard to OCE's review of 
Representative Graves' alleged conduct, and the Standards 
Committee considers the matter closed and no further inquiry is 
warranted.
    The Standards Committee's findings and conclusions are set 
forth in this Report.

                          II. FACTUAL FINDINGS


                     A. Summary of Factual Findings

    Representative Graves was appointed the Ranking Member of 
the Small Business Committee at the beginning of the 111th 
Congress. Approximately one week in advance, the Small Business 
Committee's majority staff notified the minority staff that the 
committee would hold a hearing on March 4, 2009, regarding the 
renewable fuels industry, and that the minority staff would be 
permitted to invite one witness to testify at the hearing.\1\ 
The hearing involved no legislation that would ultimately come 
to the House floor for Representative Graves and other Members 
upon which to vote, and was held solely as a fact-gathering 
hearing about the impact of the current economic crisis on the 
renewable fuels industry.\2\ Prior to selecting a witness for 
the hearing, the minority staff established criteria for a 
potential witness.\3\ The criteria that the staff established 
sought a witness who was: from Representative Graves' 
congressional district; familiar with the renewable fuels 
industry; and not employed by a company in which Representative 
Graves or his wife had invested financially.\4\
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    \1\COS 00065. The documents designated with ``COS'' numbers 
constitute the documents collected by the Standards Committee in the 
course of its investigation. Pertinent portions of the documents 
collected by the Standards Committee can be found at Appendix A. The 
Standards Committee notes that certain personal information, such as 
personal email addresses, direct-dial phone numbers, individual's 
signatures, and personal cell phone numbers have been redacted from the 
documents collected by the Standards Committee. The Standards Committee 
has redacted this information based on privacy considerations, and 
because the information is irrelevant to any question at issue in this 
Report.
    \2\Id.
    \3\COS 00065; COS 00067; COS 00069; COS 00071; COS 00073; COS 
00082; COS 00084; Memorandum of Interview of Paul Sass by OCE staff, 
June 16, 2009, para.para.4, 11; Interview of Paul Sass by Standards 
Committee staff, September 16, 2009. Pertinent portions of the OCE's 
memoranda of interview can be found at Appendix D.
    \4\Id.
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    As was the normal procedure for the Small Business 
Committee, Representative Graves had limited involvement in 
selecting a witness for the hearing.\5\ The final decision as 
to which individual was invited was left up to and actually was 
made by the minority staff.\6\ However, during the staff's 
deliberations, Paul Sass, Representative Graves' then-Deputy 
Chief of Staff, sent an email to Representative Graves seeking 
his input as to possible witnesses once the field had been 
narrowed by the minority staff to a few candidates by staff.\7\ 
In his email, Mr. Sass suggested several possible witnesses to 
Representative Graves, including Brooks Hurst. Mr. Hurst met 
each of the previously identified requirements for a 
witness.\8\ Although Mr. Hurst had investments in two renewable 
energy cooperatives in which Representative Graves' wife was 
invested, he was not employed by either company.
---------------------------------------------------------------------------
    \5\Memorandum of Interview of Rep. Graves by OCE staff, June 15, 
2009, para.3, 4; Memorandum of Interview of Paul Sass by OCE staff, 
June 16, 2009, para.57.
    \6\Interview of Paul Sass by Standards Committee staff, September 
16, 2009; Memorandum of Interview of Thomas Brown by OCE staff, June 
16, 2009, para.12; Memorandum of Interview of Paul Sass by OCE staff, 
June 16, 2009, para.16.
    \7\COS 00072
    \8\COS 00065; COS 00067; COS 00069; COS 00071; COS 00073; COS 
00082; COS 00084; Memorandum of Interview of Paul Sass by OCE staff, 
June 16, 2009, para.para.4, 11; Interview of Paul Sass by Standards 
Committee staff, September 16, 2009; Interview of Brooks Hurst by 
Standards Committee staff, September 18, 2009; Memorandum of Interview 
of Rep. Graves by OCE staff, June 16, 2009, para.13; Memorandum of 
Interview of Brooks Hurst by OCE staff, July 13, 2009, para.9.
---------------------------------------------------------------------------
    After their deliberations, the staff selected Mr. Hurst to 
testify at the hearing.\9\ Mr. Hurst testified on behalf of the 
Missouri Soybean Association (MSA) and was one of five 
witnesses at the March 4, 2009, hearing.\10\ The MSA prepared 
Mr. Hurst's written testimony and provided him with talking 
points for his oral testimony. Mr. Hurst's written and oral 
testimony advocated on behalf of the members of the MSA 
generally, and not for any specific business.\11\ The purpose 
of the March 4, 2009, hearing was informational in nature, and 
was not directed at the passage of any specific legislation. 
Neither the Standards Committee nor OCE identified any evidence 
that the March 4, 2009, hearing resulted in specific action 
benefitting Representative Graves, Mrs. Graves, Mr. Hurst, or 
any other person or entity.
---------------------------------------------------------------------------
    \9\Memorandum of Interview of Rep. Graves by OCE staff, June 15, 
2009, para.5; Interview of Paul Sass by Standards Committee staff, 
September 16, 2009.
    \10\COS 00123. The other four witnesses were selected by the 
majority staff and testified on behalf of the majority.
    \11\COS 00192-COS 195.
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          B. The Jurisdiction of the Small Business Committee

    The Small Business Committee's legislative jurisdiction 
includes:
          (1) Assistance to and protection of small business, 
        including financial aid, regulatory flexibility, and 
        paperwork reduction; and
          (2) Participation of small-business enterprises in 
        Federal procurement and Government contracts.\12\
---------------------------------------------------------------------------
    \12\House Rule X, clause 1(p).
---------------------------------------------------------------------------
    Through its referrals of legislation to the Small Business 
Committee, the Office of the Parliamentarian has interpreted 
the Small Business Committee's jurisdiction to include the 
Small Business Act, 15 U.S.C. Sec. Sec. 631-57f; the Small 
Business Investment Act, 15 U.S.C. Sec. Sec. 661-97g; Pub. L. 
No. 94-305 (the statute that created the Office of Chief 
Counsel for Advocacy at the United States Small Business 
Administration); the Regulatory Flexibility Act, 5 U.S.C. 601-
12; and the Paperwork Reduction Act, 44 U.S.C. Sec. Sec. 3501-
49.\13\
---------------------------------------------------------------------------
    \13\COS 00151-COS 00156.
---------------------------------------------------------------------------
    The Small Business Committee, as a standing House 
committee, has general oversight responsibility to determine 
whether the laws and programs within its jurisdiction ``are 
being implemented and carried out in accordance with the intent 
of Congress and whether they should be continued, curtailed, or 
eliminated[.]''\14\ In addition, the Small Business Committee 
has a special oversight function to ``study and investigate on 
a continuing basis the problems of all types of small 
business.''\15\
---------------------------------------------------------------------------
    \14\House Rule X, clause 2(b).
    \15\House Rule X, clause 3(l).
---------------------------------------------------------------------------

 C. Notification of the March 4, 2009, Small Business Committee Hearing

    Representative Graves became a Member of the Small Business 
Committee at the beginning of the 107th Congress. At the 
beginning of the 111th Congress, he was named Ranking Member of 
the Small Business Committee. On February 24, 2009, the Small 
Business Committee's majority staff informally notified the 
committee's minority staff that the full committee would hold a 
hearing regarding alternative fuels on March 4, 2009.\16\ On 
February 25, 2009, the Small Business Committee officially 
announced that the title of the March 4, 2009, hearing would be 
``The State of the Renewable Fuels Industry in the Current 
Economy.''\17\
---------------------------------------------------------------------------
    \16\COS 00065.
    \17\COS 00019.
---------------------------------------------------------------------------
    The Small Business Committee's rules state:

          Whenever any hearing is conducted by the committee or 
        any subcommittee upon any measure or matter, the 
        minority party members on the committee shall be 
        entitled, upon request to the Chairwoman by a majority 
        of those minority members, to call a witness or 
        witnesses selected by the minority to testify with 
        respect to that measure or matter. The minority shall 
        be entitled to a ratio of one-third of the witnesses 
        testifying.\18\
---------------------------------------------------------------------------
    \18\Small Business Committee Rules and Procedures, Rule 6(B).

    Upon receiving the February 24, 2009, hearing notification, 
a member of the minority staff of the Small Business Committee 
sent an email to Mr. Sass. That email contained the following 
text: ``Chances that we'll find someone and be able to get them 
here by next week is slim, but thought I'd ask. The majority 
needs to do a better job on letting us know what the schedule 
is.''\19\
---------------------------------------------------------------------------
    \19\COS 00065. Pursuant to the Small Business Committee's rules, 
the majority staff on the Small Business Committee is required to 
announce hearing topics at least one week in advance. Small Business 
Committee Rules and Procedures, Rule 4. Mr. Sass told the Standards 
Committee that on some occasions the majority staff notified the 
minority staff as much as two weeks in advance of a hearing. Interview 
of Paul Sass by Standards Committee staff, September 16, 2009.
---------------------------------------------------------------------------

   D. Criteria for Selecting a Witness for the March 4, 2009, Small 
                       Business Committee Hearing

    After receiving the February 24, 2009, notification, 
Representative Graves' staff and the minority staff for the 
Small Business Committee exchanged emails regarding possible 
witnesses to invite to testify at the hearing. On February 24, 
2009, a member of the minority staff on the Small Business 
Committee sent an email at 1:47 p.m. to Mr. Sass. That email 
contained the following text:

          The majority just let us know (about 15 minutes ago) 
        that next week there will be a hearing on renewable 
        fuels. I know nothing other than that. I have made the 
        calls to the majority to find out. Don't know what the 
        angle is, but is there anybody back in the district who 
        has come to the office to talk alternative fuels that 
        might be a good witness?\20\
---------------------------------------------------------------------------
    \20\COS 00065.

    Both in discussions and in emails, the staff developed a 
series of criteria for potential witnesses. One such criterion 
was that the witness should have knowledge of the issues facing 
the renewable energy industry. On February 24, 2009, Mr. Sass 
sent an email at 1:53 p.m. to several staff members. That email 
contained the following text: ``Please see the email below and 
let me know if you have any suggestions on who can testify next 
week on renewable energy.''\21\ The next day, a staff member 
sent an email at 10:50 a.m. in response to Mr. Sass' inquiries. 
That email contained the following text: ``Also might be good 
to get an actual grain farmer to come in if it fits.''\22\
---------------------------------------------------------------------------
    \21\COS 00071.
    \22\COS 00084.
---------------------------------------------------------------------------
    Another staff criterion for a potential witness was that 
the witness should be from the congressional district 
represented by Representative Graves.\23\ A member of the 
minority staff on the Small Business Committee sent an email on 
February 24, 2009, at 1:56 p.m. to Mr. Sass. That email 
contained the following text: ``I don't want to pass this along 
to you but with no notice at all, it makes it tough for me to 
go through channels here in DC to find someone from MO-6.''\24\ 
Mr. Sass sent an email to two members of the minority staff on 
the Small Business Committee on February 24, 2009, at 4:05 p.m. 
That email contained the following text: ``We should not have 
any problem finding a person from the 6th to testify at this 
hearing, We have extensive Ag contacts in the district.''\25\
---------------------------------------------------------------------------
    \23\Representative Graves represents the Sixth Congressional 
District of Missouri.
    \24\COS 00082.
    \25\COS 00073.
---------------------------------------------------------------------------
    According to OCE's interview memorandum, Mr. Sass told OCE 
that ``[h]is boss was new to the Ranking Member position and 
wanted the witness to come from the 6th district and to be 
competent.'' The interview memorandum further states that Mr. 
Sass ``started looking for witnesses from the district and then 
branched out from there to other parts of the state.''\26\
---------------------------------------------------------------------------
    \26\Memorandum of Interview of Paul Sass by OCE staff, June 16, 
2009, para.4.
---------------------------------------------------------------------------
    Mr. Sass told the Standards Committee that the process for 
selecting a witness for Small Business Committee hearings had 
evolved over time.\27\ He stated that the staff usually started 
their search for a witness by looking for witnesses within the 
Sixth District of Missouri.\28\ He further stated that, 
depending on the topic, the staff sometimes looked for 
witnesses from the districts of other minority Members on the 
Small Business Committee.\29\ He explained that because the 
March 4, 2009, hearing dealt with agriculture and renewable 
fuels, he believed that the staff would have no difficulty 
finding a witness from the Sixth District of Missouri.\30\
---------------------------------------------------------------------------
    \27\Interview of Paul Sass by Standards Committee staff, September 
16, 2009.
    \28\Id.
    \29\Id.
    \30\Id.
---------------------------------------------------------------------------
    A third staff criterion for a potential witness was that 
the witness should not be an officer or employee of a renewable 
energy company in which Representative Graves had a direct 
financial interest.\31\ Representative Graves' Communications 
Director sent an email to Mr. Sass on February 24, 2009, at 
2:56 p.m. That email contained the following text: ``Lets [sic] 
make sure that we do not get a renewable company that 
[Representative Graves] or his wife is invested in.''\32\ Mr. 
Sass told OCE that, ``he did not want a witness from any 
companies that Representative Graves was invested in--someone 
with their name on a business card.''\33\ Mr. Sass explained to 
the Standards Committee that the staff was concerned with 
selecting a witness, such as a president or CEO, who was 
actually employed by a company in which Representative Graves 
or his wife was invested.\34\ Mr. Sass also told the Standards 
Committee that the staff usually looked for a witness that was 
involved with an association of some kind, because the 
association would usually pay for the trip to Washington, 
D.C.\35\
---------------------------------------------------------------------------
    \31\COS 00069 and COS 00073.
    \32\COS 00067.
    \33\Memorandum of Interview of Paul Sass by OCE staff, June 16, 
2009, para. 11.
    \34\Interview of Paul Sass by Standards Committee staff, September 
16, 2009.
    \35\Id.
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    E. Selection of Mr. Hurst for the March 4, 2009, Small Business 
                           Committee Hearing


1. The Staff Considered Several Potential Witnesses

    The Small Business Committee staff and Representative 
Graves' personal staff considered a number of potential 
witnesses based on the criteria they developed. On February 25, 
2009, at 10:50 a.m., a member of Representative Graves' 
personal staff sent an email to Mr. Sass, suggesting possible 
witnesses. That email contained the following text: ``Anyone at 
Golden Triangle in Craig. Bill Becker at Lifeline would be 
good.''\36\ The staff also considered Steve Flick, President of 
the Board of Show Me Energy, a biomass cooperative located in 
Centerview, Missouri.\37\ One member of the staff sent an email 
to Mr. Sass on February 24, 2009, at 4:36 p.m., stating: ``Only 
folks that come to mind are the heads of the soybean and 
ethanol groups . . . Dale Ludwig, etc.''\38\ Another member of 
the staff wrote an email to Mr. Sass on February 25, 2009, at 
10:04 a.m., noting that members of the Missouri Corn Growers 
Association would be in Washington, D.C., during the week of 
the hearing.\39\
---------------------------------------------------------------------------
    \36\COS 00084.
    \37\COS 00066.
    \38\COS 00071.
    \39\COS 00088.
---------------------------------------------------------------------------
    The staff excluded certain of the potential witnesses for 
failure to meet one or more of the criteria they had 
established. For example, the staff dismissed one potential 
witness because he was not from Representative Graves' 
congressional district.\40\
---------------------------------------------------------------------------
    \40\See Memorandum of Interview of Paul Sass by OCE staff, June 16, 
2009, para.15. (``He threw out the idea of inviting Steve Flick because 
he wasn't from the 6th district. He did not believe that he worked for 
any of the companies but he resided outside the district.''); see also 
COS 00069 (noting that Show Me Energy is ``just south of the 
district'').
---------------------------------------------------------------------------

2. The Staff Solicited Suggestions From Representative Graves

    In addition to their own deliberations, the staff also 
asked Representative Graves if he had suggestions as to 
possible witnesses; however, the evidence indicates that, 
consistent with the standard practice for the minority on the 
Small Business Committee, Representative Graves had limited 
involvement in the selection of a witness to testify at the 
March 4, 2009, hearing. On February 24, 2009, at 4:44 p.m., Mr. 
Sass sent an email to Representative Graves. That email 
contained the following text:

          The Small Business Committee is doing a hearing on 
        renewable fuels next week. Do you have anybody off the 
        top of your head who we should invite? Last time we had 
        a hearing on the topic you invited Brooks and Charlie 
        Hurst. Any one you want me to call? Steve Flick?\41\
---------------------------------------------------------------------------
    \41\COS 00072. Mr. Sass told the Standards Committee that 
sometimes, including in this case, when he referred to Representative 
Graves as taking some action he meant Representative Graves' office 
took the action, and not necessarily Representative Graves personally. 
Interview of Paul Sass by Standards Committee staff, September 16, 
2009.

This message appears to be the first written communication to 
Representative Graves regarding the hearing. Notably the staff 
solicited suggestions from Representative Graves after they 
developed their criteria for selecting a witness.
    Representative Graves told OCE that ``[h]e was not aware of 
the process for finding witnesses for hearings, staff handles 
finding witnesses.''\42\ The interview memorandum further 
states ``Many times, [Representative Graves] does not know who 
the witness will be until the hearing.''\43\ Mr. Sass told OCE 
that ``Representative Graves doesn't get involved in the weeds, 
everything is staff driven. Decisions can be made better that 
way.''\44\
---------------------------------------------------------------------------
    \42\Memorandum of Interview of Rep. Graves by OCE staff, June 15, 
2009, para.113.
    \43\Id., at para.4.
    \44\Memorandum of Interview of Paul Sass by OCE staff, June 16, 
2009, para.57.
---------------------------------------------------------------------------
    One of the potential witnesses discussed by Representative 
Graves and Mr. Sass was Mr. Hurst.\45\ Mr. Hurst is a farmer 
who resides in Representative Graves' congressional 
district\46\ and who is a member of the Board of Directors of a 
majority-farmer-owned biodiesel production facility located in 
Missouri.\47\ Mr. Hurst is currently on the board of Paseo-
Cargill.\48\ Mr. Hurst told the Standards Committee that he was 
previously involved in various agricultural cooperatives, and 
that he had served on the boards of several cooperatives.\49\
---------------------------------------------------------------------------
    \45\Interview of Paul Sass by Standards Committee staff, September 
16, 2009. The Standards Committee notes that Representative Graves told 
OCE that in response to a request for a recommendation, he ``threw out 
Brooks Hurst's name for consideration.'' Memorandum of Interview of 
Rep. Graves by OCE staff, June 15, 2009, para.6. However, 
Representative Graves' recollection is not supported by any other 
witness testimony, nor by the documentary record. See e.g., COS 00072; 
Interview of Paul Sass by Standards Committee staff, September 16, 
2009.
    \46\COS 00192-COS 195.
    \47\Id.
    \48\Interview of Brooks Hurst by Standards Committee staff, 
September 18, 2009.
    \49\Id.
---------------------------------------------------------------------------
    Mr. Hurst currently serves on the Board of the MSA and was 
President of the MSA for three terms from 2000 through 
2002.\50\ Mr. Hurst told the Standards Committee that while he 
was President of the MSA, he spoke several times a year to 
different groups regarding renewable fuel issues and that he 
was interviewed on various agriculture radio programs at least 
once a month.\51\ He further stated that since 2002, he has 
spoken to various groups on renewable fuel issues approximately 
once every two years.\52\ Representative Graves told OCE that 
Mr. Hurst ``is the President of the Missouri Soybean 
Association, he is involved with the corn growers, and he 
testifies throughout the country on renewable fuels.''\53\
---------------------------------------------------------------------------
    \50\Id.
    \51\Id.
    \52\Id.
    \53\Memorandum of Interview of Rep. Graves by OCE staff, June 16, 
2009, para.13.
---------------------------------------------------------------------------
    Mr. Hurst has previously testified at Congressional 
hearings on issues related to renewable fuels. Mr. Hurst told 
OCE that:

        [h]e had been invited to testify before the Committee 
        on Small Business on two previous occasions. He 
        recalled being invited for the first time by then-
        Representative Jim Talent. He could recall that it was 
        Representative Talent because it was his first time 
        testifying before Congress.\54\
---------------------------------------------------------------------------
    \54\Memorandum of Interview of Brooks Hurst by OCE staf, July 13, 
2009, para.9.

Mr. Hurst told the Standards Committee that he recalled being 
invited to testify at Congressional hearings on at least four 
occasions.\55\ Each time he was invited to testify on behalf of 
the MSA.\56\ In addition to being invited to testify before the 
Small Business Committee twice by Representative Graves and 
once by former-Representative Talent,\57\ Mr. Hurst said that 
he recalled being invited to testify in front of the Committee 
on Ways and Means by former-Representative Kenny Hulshof.\58\
---------------------------------------------------------------------------
    \55\Interview of Brooks Hurst by Standards Committee staff, 
September 18, 2009. The Standards Committee was able to confirm 
independently that, in addition to his testimony during the hearing at 
issue, Mr. Hurst testified at a hearing before the Small Business 
Committee on March 15, 2000, entitled ``Helping Agricultural Producers 
`Re-Grow' Rural America: Providing the Tools'' and a February 23, 2004, 
hearing before the Small Business Subcommittee on Rural Enterprises, 
Agriculture, and Technology, entitled ``The Endangered Species Act's 
Impact on Small Businesses and Farmers, Field Hearing, St. Joseph, 
MO.''
    \56\Id.
    \57\Representative Talent served as a Member of Congress from 
Missouri's Second Congressional District from 1993 to 2000.
    \58\Id. Representative Hulshof served as a Member of Congress from 
Missouri's Ninth Congressional District from 1997 to 2009.
---------------------------------------------------------------------------
    Mr. Hurst told OCE ``he was the first person that 
Representative Graves thought of because he was the President 
of the MSA and he had worked on biodiesel issues in the past 
and because the hearing was scheduled with such [short] 
notice.''\59\ Representative Graves also told OCE that, among 
other reasons for selecting Mr. Hurst, he ``was the easiest 
witness to find for the hearing that was held in March given 
the short time frame for locating witnesses and he was one of 
the most knowledgeable persons available.''\60\
---------------------------------------------------------------------------
    \59\Memorandum of Interview of Brooks Hurst by OCE staff, July 13, 
2009, para.5.
    \60\Memorandum of Interview of Rep. Graves by OCE staff, June 15, 
2009, para.2.
---------------------------------------------------------------------------

3. Brooks Hurst Was Selected To Testify at the Hearing

    Mr. Sass told the Standards Committee that the Small 
Business Committee's minority staff eventually identified two 
witnesses who satisfied their initial requirements, one of whom 
was Mr. Hurst.\61\ The other potential witness was already 
scheduled to be in Washington, D.C. on the day of the 
hearing.\62\ Representative Graves told OCE that he did not 
want the other witness to testify at the hearing because he 
believed that the Small Business Committee may have assisted 
the other witness's company with grants.\63\ OCE's interview 
memorandum of Representative Graves states, ``[w]hen asked 
about the members of the corn growers being in town at the time 
of the meeting, Representative Graves stated that ```if he 
remembered correctly' the Committee already had an `ethanol 
guy' and they were looking for a `biodiesel guy' to balance out 
the witness list as much as possible.''\64\
---------------------------------------------------------------------------
    \61\Interview of Paul Sass by Standards Committee staff, September 
16, 2009.
    \62\Id.
    \63\Memorandum of Interview of Rep. Graves by OCE staff, June 15, 
2009, para.22.
    \64\Id., at para.29.
---------------------------------------------------------------------------
    Representative Graves told OCE that he ``was not sure who 
chose Brooks Hurst to testify at the hearing; he believed that 
it might have been Paul Sass.''\65\ Mr. Sass told OCE that he 
believed that he suggested Mr. Hurst to Representative 
Graves.\66\ Representative Graves' Chief of Staff and Mr. Sass 
told OCE that they believed that Representative Graves did not 
choose Mr. Hurst to be a witness and that Representative Graves 
did not get involved in the process of selecting witnesses for 
Small Business Committee hearings.\67\ Mr. Sass told the 
Standards Committee that he made the ultimate decision to 
invite Mr. Hurst.\68\
---------------------------------------------------------------------------
    \65\Id., para.5.
    \66\Memorandum of Interview of Paul Sass by OCE staff, June 16, 
2009, para.para.23, 29.
    \67\Memorandum of Interview of Thomas Brown by OCE staff, June 16, 
2009, para.12; Memorandum of Interview of Paul Sass by OCE staff, June 
16, 2009, para.16.
    \68\Interview of Paul Sass by Standards Committee staff, September 
16, 2009. On February 25, 2009, Mr. Sass sent an email at 9:53 a.m. to 
two other staff members. That email contained the following text: 
``Back in 2004 SG had a friend . . . who is a member of the MO Soybean 
Assn testify on a similar topic and he wants to extend an invitation to 
him. I am calling him today to gauge his interest.'' COS 00089. Mr. 
Sass told the Standards Committee that his word choice in this email 
could be misread. Interview of Paul Sass by Standards Committee staff, 
September 16, 2009. Mr. Sass explained that often times, including in 
this case, when he referred to Representative Graves as wanting 
something, he meant Representative Graves' personal office, as opposed 
to the Small Business Committee minority staff. Id.
---------------------------------------------------------------------------
    Mr. Sass told the Standards Committee that he placed 
telephone calls and sent emails to Mr. Hurst to invite him to 
the hearing, but Mr. Hurst did not immediately return his calls 
or reply to his emails.\69\ It appears that instead of replying 
to Mr. Sass, Mr. Hurst called Representative Graves directly to 
confirm his availability. On February 26, 2009, Mr. Sass sent 
an email at 5:09 p.m. to three staff members. That email 
contained the following text: ``Ok, I just spoke with Sam and 
apparently Brooks Hurst is back on board. It will get nailed 
down tomorrow. I got Sam to agree to allowing [the other 
witness] to testify if Brooks doesn't work out.''\70\
---------------------------------------------------------------------------
    \69\Interview of Paul Sass by Standards Committee staff, September 
16, 2009.
    \70\COS 00092.
---------------------------------------------------------------------------

      F. Financial Interest Putatively Shared by Brooks Hurst and 
                         Representative Graves

    At the time of the hearing, Representative Graves' wife had 
investments in two Missouri non-profit cooperative marketing 
associations specializing in renewable fuels: Golden Triangle 
Energy Cooperative (Golden Triangle) and Biofuels LLC 
(Biofuels).\71\ Mrs. Graves' investment in Golden Triangle 
represents a 0.18% interest in the cooperative and is valued 
between $1,000 and $15,000.\72\ Mrs. Graves' investment in 
Biofuels represents a 0.125% interest and is valued between 
$15,000 and $50,000.\73\ Mrs. Graves' investments in Golden 
Triangle and Biofuels were disclosed on Representative Graves' 
Financial Disclosure Statements.\74\ Mr. Hurst also has 
investments in both Golden Triangle and Biofuels.\75\ Mr. 
Hurst's investment in Golden Triangle represents a 0.50% 
interest in the cooperative.\76\ Mr. Hurst's investment in 
Biofuels represents an interest of less than 0.33%.\77\
---------------------------------------------------------------------------
    \71\COS 00061; COS 00063.
    \72\COS 00061; Rep. Graves' 2008 Financial Disclosure Statement.
    \73\COS 00063; Rep. Graves' 2008 Financial Disclosure Statement. 
Mrs. Graves is one of 400 investors in Biofuels. COS 00063.
    \74\Rep. Graves' 2008 Financial Disclosure Statement.
    \75\COS 00114; COS 00115.
    \76\Id.
    \77\COS 00115.
---------------------------------------------------------------------------
    Representative Graves told OCE that ``[i]nvestments are not 
something that he talks about with Brooks Hurst. He could not 
say what Brooks Hurst was invested in; he goes in and out of 
investments so he wouldn't know what he was invested in.''\78\ 
Similarly, Mr. Hurst told OCE that he was not aware of any of 
Representative Graves' investments.\79\ Representative Graves' 
staff also stated that they did not know of any shared 
investments between Representative Graves and Mr. Hurst. Mr. 
Sass told OCE that ``[h]e does not have discussions of 
witnesses' personal financial records.''\80\ Representative 
Graves' staff was aware that Mr. Hurst was a friend of 
Representative Graves. However, the staff did not view that as 
problematic. OCE's interview memorandum of Mr. Sass states, 
``When asked if the Congressman's friendship with Brooks Hurst 
was an issue, he stated that it was not because Brooks Hurst 
was a credible witness, he is involved with all the 
associations so it was not a concern.''\81\
---------------------------------------------------------------------------
    \78\Memorandum of Interview of Rep. Graves by OCE staff, June 15, 
2009, para.39.
    \79\Memorandum of Interview of Brooks Hurst by OCE staff, July 13, 
2009, para.para.14 and 18.
    \80\Memorandum of Interview of Paul Sass by OCE staff, June 16, 
2009, para.11.
    \81\Id., at if para.45.
---------------------------------------------------------------------------
    OCE asserts that Representative Graves may have been aware 
at one time of Mr. Hurst's investments in Golden Triangle and 
Biofuels several years prior to Mr. Hurst's testimony at the 
hearing. Media reports of a 2004 hearing of the Small Business 
Subcommittee on Rural Enterprises, Agriculture, and Technology, 
at which Mr. Hurst testified, referenced Mrs. Graves' and Mr. 
Hurst's shared investments.\82\ One such article stated: 
``Graves told The Kansas City Star . . . that his failure to 
disclose his connection to Golden Triangle at the hearing was a 
mistake. `Looking back on it, I probably should have,' the 
Tarkio Republican said.''\83\ However, Representative Graves 
told OCE that this quotation was incomplete and that his full 
statement was that he probably should have disclosed his 
connection to Golden Triangle ``if he had known what his 
([Brooks Hurst]'s) investments were.''\84\ Even if 
Representative Graves was aware at any time of Mr. Hurst's 
investments, this knowledge would not have been a violation of 
House Rules in either 2004 or in the present case.
---------------------------------------------------------------------------
    \82\See, e.g., ``Biofuels, Flights Benefit Graves,'' Paul Singer, 
Roll Call, November 7, 2007.
    \83\See ``Family ties to ethanol plant draw questions for Rep. Sam 
Graves,'' Steve Kraske, The Kansas City Star, December 6, 2007.
    \84\Memorandum of Interview of Rep. Graves by OCE staff, June 15, 
2009, para.53.
---------------------------------------------------------------------------

G. Brooks Hurst and the March 4, 2009, Small Business Committee Hearing

    Pursuant to House Rules, when a non-governmental witness is 
selected to testify at a hearing, the witness must submit a 
written copy of the statement that will be made part of the 
hearing record, a curriculum vitae, and:

        a disclosure of the amount and source (by agency and 
        program) of each Federal grant (or subgrant thereof) or 
        contract (or subcontract thereof) received during the 
        current fiscal year or either of the two previous 
        fiscal years by the witness or by an entity represented 
        by the witness.\85\
---------------------------------------------------------------------------
    \85\House Rule XI, clause 2(g)(4).

Under House Rules, this is the only information that a 
committee must receive regarding the background of a 
witness.\86\ Mr. Hurst complied with these rules.\87\
---------------------------------------------------------------------------
    \86\Id.
    \87\COS 00013.
---------------------------------------------------------------------------
    Mr. Hurst was one of five witnesses at the March 4, 2009, 
Small Business Committee hearing.\88\ The other witnesses 
included a representative of an ethanol plant, a representative 
of a biofuels plant equipment manufacturer, a representative 
from the National Biodiesel Board, and a representative from 
the National Corn Growers Association.\89\ Mr. Hurst 
represented the MSA at the hearing.\90\
---------------------------------------------------------------------------
    \88\A member of Representative Graves' personal staff coordinated 
Mr. Hurst's travel to Washington, D.C. The electronic confirmation for 
Mr. Hurst's travel to and from Washington, D.C., indicates that Mr. 
Hurst departed Kansas City for Washington, D.C. on March 3, 2009, at 
9:00 a.m., and departed Washington, D.C., for Kansas City on March 4, 
2009, at 6:35 p.m. COS 00099. The cost of the airplane ticket appears 
to be $165.20, and Mr. Hurst paid for his travel to and from 
Washington, D.C. COS 00125.
    \89\COS 00183-00186; COS 00175-00182; COS 00187-00191; COS 00170-
00174.
    \90\On March 2, 2009, at 3:10 p.m., Mr. Hurst sent an email to a 
member of the minority staff on the Small Business Committee replying 
to a prior email that inquired as to what Mr. Hurst ``would like [his] 
affiliation to be for the hearing.'' Mr. Hurst's email contained the 
following text: ``Go ahead and use my title as member of the board of 
directors of the Paseo-Cargill Biofuels plant and Missouri Soybean 
Association.'' COS 00123.
---------------------------------------------------------------------------
    The MSA both prepared Mr. Hurst's written testimony and 
provided him with talking points for his oral testimony.\91\ 
Mr. Hurst told OCE, ``He works with the Missouri Soybean 
Association. The Missouri Soybean Association provided him with 
written testimony and prepped him for the March hearing, as 
they have done on other occasions when he testified on behalf 
of the association.''\92\ Mr. Hurst told the Standards 
Committee that the MSA assisted to varying degrees with the 
drafting of all of his Congressional testimony.\93\ Mr. Hurst 
further stated that the MSA provided more assistance for the 
March 4, 2009, hearing than in the past because the week 
leading up to Mr. Hurst's testimony was in the middle of the 
planting season for Mr. Hurst's farm.\94\
---------------------------------------------------------------------------
    \91\COS 00103; COS 00116; COS 00117.
    \92\Memorandum of Interview of Brooks Hurst by OCE staff, July 13, 
2009, para.10; see also COS 00103 (email from the MSA sending Mr. 
Hurst's written testimony to Mr. Hurst with a copy to Representative 
Graves' Staff Assistant/Assistant Scheduler).
    \93\Interview of Brooks Hurst by Standards Committee staff, 
September 18, 2009.
    \94\Id.
---------------------------------------------------------------------------
    During his testimony, Mr. Hurst recommended an extension of 
the Biodiesel Blender's Credit program, inclusion of glycerin 
in the Bio-based Fuel Blender's Credit program, and 
implementation of the Renewable Fuels Standard.\95\ Mr. Hurst's 
written and oral testimony made anecdotal references to 
specific renewable fuel plants.\96\ The testimony, however, 
advocated on behalf of the members of the MSA generally, and 
not for either of the entities in which Representative Graves' 
wife owned an interest or any other specific business.\97\ 
There was, moreover, significant overlap between the positions 
taken by Mr. Hurst and those taken by the representative of the 
National Biodiesel Board, a witness who was called to testify 
at the hearing by the Small Business Committee majority.\98\
---------------------------------------------------------------------------
    \95\COS 00192-00195.
    \96\Id.
    \97\Id.
    \98\See COS 00192-00195; COS 00187-00191.
---------------------------------------------------------------------------

    H. Actions Taken Following the Small Business Committee Hearing

    OCE's Report and Findings do not contain evidence that the 
March 4, 2009, Small Business Committee hearing resulted in 
action benefitting anyone, including Representative Graves, 
Mrs. Graves, or Mr. Hurst. The Standards Committee has also 
uncovered no direct evidence that the hearing resulted in 
action benefitting Representative Graves, Mrs. Graves, Mr. 
Hurst, or any other person or entity.
    Neither Mr. Hurst nor Mr. Sass was aware of any action on 
any of the issues discussed in his testimony.\99\ The Staff 
Director for the majority on the Small Business Committee also 
was not aware of any action on any of the issues discussed in 
Mr. Hurst's testimony.\100\
---------------------------------------------------------------------------
    \99\Interview of Paul Sass by Standards Committee staff, September 
16, 2009; Interview of Brooks Hurst by Standards Committee staff, 
September 18, 2009.
    \100\Interview of Michael Day by Standards Committee staff, 
September 25, 2009.
---------------------------------------------------------------------------
    As noted previously, the Small Business Committee has 
limited legislative jurisdiction. Representative Graves told 
OCE that the Small Business Committee:

        is an oversight committee; it does not do legislation 
        except the authorization of the Small Business 
        Association. The hearings are ``feel good hearings.'' . 
        . . The committee can look at venture capital, 
        healthcare, animal pharmaceuticals, anything. The 
        committee doesn't have a real agenda other than the 
        Small Business Association so they look at all types of 
        industries.\101\
---------------------------------------------------------------------------
    \101\Memorandum of Interview of Rep. Graves by OCE staff, June 15, 
2009, para.62.

    Mr. Sass told OCE that the Small Business Committee ``has 
limited jurisdiction so they can talk about anything at 
hearings. The `take-away' is to try and get press. Other than 
getting press on an issue, the Committee can't really do 
anything.''\102\
---------------------------------------------------------------------------
    \102\Memorandum of Interview of Paul Sass by OCE staff, June 16, 
2009, para.5.
---------------------------------------------------------------------------
    According to OCE's interview memorandum of Representative 
Graves: ``[w]hen asked if he talked to Brooks Hurst about the 
hearing, Representative Graves stated that he had not, `other 
than this issue and how ridiculous it is.'''\103\ OCE's 
interview memorandum of Representative Graves further states:
---------------------------------------------------------------------------
    \103\Memorandum of Interview of Rep. Graves by OCE staff, June 15, 
2009, para.72.

          When asked why it is a ridiculous issue, 
        Representative Graves stated that it was simply a lot 
        of money and time that was being used to look into the 
        matter and there was not anything there; he thought the 
        OCE ``must not have anything better to do.''\104\
---------------------------------------------------------------------------
    \104\Id., at para.73.
---------------------------------------------------------------------------

              III. JURISDICTION OF THE STANDARDS COMMITTEE

    The Standards Committee has jurisdiction over the matters 
addressed in this Report pursuant to House Rule 11, clause 
3(a)(2), which authorizes the Standards Committee to 
investigate any alleged violation by a Member, officer, or 
employee of the House of Representatives, of the Code of 
Official Conduct or of any law, rule, regulation, or other 
standard of conduct applicable to the conduct of such Member, 
officer, or employee.
    The Standards Committee conducted its investigation in this 
matter pursuant to Standards Committee Rule 18(a), which 
authorizes the Committee to consider any information in its 
possession indicating that a Member, officer, or employee may 
have committed a violation of the Code of Official Conduct or 
any law, rule, regulation, or other standard of conduct 
applicable to the conduct of such Member, officer, or employee 
in the performance of the duties or the discharge of the 
responsibilities of such individual. Standards Committee Rule 
18(a) further authorizes the Chair and Ranking Minority Member 
to jointly gather additional information concerning such an 
alleged violation by a Member, officer, or employee unless and 
until an investigative subcommittee has been established.
    The Standards Committee has authority to issue this Report 
pursuant to House Rule 11, clause 3(a)(2), under which the 
Standards Committee shall report to the House its findings of 
fact and recommendations, if any, for the final disposition of 
any investigation and action as the committee may consider 
appropriate under the circumstances; and House Rule 11, clause 
3(b)(8)(A), which authorizes the Standards Committee to report 
on matters forwarded to the Standards Committee by the Office 
of Congressional Ethics (OCE).

                           IV. LEGAL ANALYSIS

    OCE reviewed Representative Graves' conduct pursuant to 
House Rule 3, clause 1; House Rule 23, clause 2; and what OCE 
identified as ``House precedent on conflicts of interest.'' For 
this reason, the Standards Committee also reviewed 
Representative Graves' conduct pursuant to these rules and 
standards of conduct. Based on the facts presented in OCE's 
Report and Findings, as well as the facts gathered by the 
Standards Committee's independent inquiry, the Standards 
Committee concluded that Representative Graves' conduct did not 
implicate any of the rules or standards of conduct identified 
by OCE. Thus, the Standards Committee further determined that 
OCE analyzed Representative Graves' conduct pursuant to the 
incorrect rules.
    Instead, the Standards Committee determined that 
Representative Graves' conduct should more properly have been 
analyzed under House Rule 23, clause 3; and section 5 of the 
Code of Ethics for Government Service (Code of Ethics). After 
reviewing Representative Graves' conduct pursuant to House Rule 
23, clause 3, and section 5 of the Code of Ethics, the 
Standards Committee concluded that Representative Graves' 
involvement with the witness selection process for the March 4, 
2009, Small Business Committee hearing did not violate any 
applicable rule or standard of conduct.

              A. Analysis Based on Rules Identified by OCE


1. Voting on Matters Affecting a Direct Personal Interest (House Rule 
        3, Clause 1)

    OCE analyzed Representative Graves' conduct pursuant to 
House Rule 3, clause 1;\105\ and House Rule 23, clause 2.\106\ 
The Standards Committee determined that Representative Graves' 
conduct did not implicate these rules.
---------------------------------------------------------------------------
    \105\House Rule III, clause 1.
    \106\House Rule XXIII, clause 2.
---------------------------------------------------------------------------
    House Rule 3, clause 1 provides:

          Every Member . . . shall vote on each question put, 
        unless having a direct personal or pecuniary interest 
        in the event of such question.\107\
---------------------------------------------------------------------------
    \107\House Rule III, clause 1. The Standards Committee notes that 
OCE's references to House Rule 3 are only found in OCE's Findings, and 
not OCE's Report. Further, OCE's notifications to the Standards 
Committee and Representative Graves also did not mention that OCE was 
analyzing Representative Graves' conduct under House Rule 3. Because 
OCE did not provide Representative Graves with a copy of its Findings, 
Representative Graves was not made aware that his conduct was being 
analyzed under House Rule 3 until the Standards Committee forwarded a 
copy of OCE's Findings to Representative Graves on September 16, 2009.

---------------------------------------------------------------------------
    House Rule 23, clause 2 provides:

          A Member . . . shall adhere to the spirit and the 
        letter of the Rules of the House. . . .\108\
---------------------------------------------------------------------------
    \108\House Rule XXIII, clause 2.

    OCE initially alleged that Representative Graves' conduct 
may have implicated House Rule 3, clause 1, and House Rule 23, 
clause 2, because his involvement in selecting Mr. Hurst to 
appear before the Small Business Committee may have violated 
``the spirit of House Rule 3.''\109\ However, OCE ultimately 
concluded:
---------------------------------------------------------------------------
    \109\OCE Review No. 09-7000, Findings of Fact and Citations of Law 
(OCE Findings), para.82.

        any disqualifying interest that Representative Graves 
        had in this matter would likely have affected 
        Representative Graves only as a member of a class; 
        therefore, there is not substantial reason to believe 
        that Representative Graves' invitation to [Mr. Hurst] 
        violated the spirit of House Rule 3.\110\
---------------------------------------------------------------------------
    \110\Id.

    The Standards Committee agrees with OCE's conclusion that 
Representative Graves did not violate the letter or spirit of 
House Rule 3. However, the Standards Committee feels compelled 
to note that the underlying premise of OCE's analysis was 
flawed because the Standards Committee finds that 
Representative Graves' conduct did not implicate House Rule 3.
    House Rule 3 applies in one situation only--when a Member 
is voting on the House floor.\111\ Representative Graves was 
not voting, to the contrary, the March 4, 2009, hearing 
involved no legislation that would ultimately come to the House 
floor for Representative Graves and other Members upon which to 
vote. Therefore, House Rule 3 was inapplicable to 
Representative Graves' conduct. Moreover, because House Rule 3 
was inapplicable to Representatives Graves' conduct, the 
``spirit'' of House Rule 3 was equally inapplicable. For these 
reasons, OCE's analysis was flawed because OCE analyzed 
Representative Graves' activities with respect to witness 
selection under the rule applicable to voting.
---------------------------------------------------------------------------
    \111\House Ethics Manual, Committee on Standards of Official 
Conduct, 110th Congress, 2nd Sess. (2008 ed.) (House Ethics Manual) at 
237.
---------------------------------------------------------------------------

2. House ``Precedent'' on Conflict of Interest

    OCE alleged Representative Graves' conduct may have 
violated what OCE identified as House ``precedent'' on conflict 
of interest.\112\ OCE ultimately concluded:
---------------------------------------------------------------------------
    \112\OCE Report. A copy of the report can be at Appendix E.

        the Board finds there is substantial reason to believe 
        that the guidance in the House Ethics Manual--advising 
        Members to employ ``added circumspection'' when 
        participating in actions that may affect their personal 
        financial interest and to guard against taking any 
        action that would give the appearance of any 
        impropriety or conflict of interest--would compel 
        Representative Graves to disclose the financial 
        interests he shared with [Mr. Hurst] at the time of the 
        Committee hearing or refrain from extending [Mr. Hurst] 
        an invitation to appear. . . .
          [T]here is substantial reason to believe that 
        Representative Graves' invitation to [Mr. Hurst] 
        created an appearance of a conflict of interest[.]\113\
---------------------------------------------------------------------------
    \113\OCE Findings, para.para.81, 82 (emphasis added).

    Notably, OCE did not cite any House Rule or other standard 
of conduct in reaching this conclusion. The House Ethics Manual 
provides guidance to assist Members, officers, and staff in 
complying with the Code of Official Conduct or any law, rule, 
regulation, or other standard applicable to their conduct in 
the performance of their duties or the discharge of their 
responsibilities.\114\ The House Ethics Manual does not create 
independent duties outside of the rules and other standards 
discussed therein. The Standards Committee is particularly 
concerned that OCE's analysis in this matter may create 
confusion regarding Standards Committee precedent with respect 
to conflicts of interest.\115\
---------------------------------------------------------------------------
    \114\House Ethics Manual, Preface; House Rule XI, clause 3(a).
    \115\The Standards Committee notes that it has exclusive 
jurisdiction over the interpretation, administration, and enforcement 
of the Code of Official Conduct. See House Rule 1(q); Standards 
Committee Rule 17A(a).
---------------------------------------------------------------------------
    The pertinent section of the House Ethics Manual cited by 
OCE states:

          [A]ctions that Members may normally take on 
        particular matters in connection with their official 
        duties, such as sponsoring legislation, advocating or 
        participating in an action by a House committee, or 
        contacting an executive branch agency . . . entail a 
        degree of advocacy above and beyond that involved in 
        voting, and thus a Member's decision on whether to take 
        any such action on a matter that may affect his or her 
        personal financial interests requires added 
        circumspection.\116\
---------------------------------------------------------------------------
    \116\House Ethics Manual at 237.

    However, no relevant House Rule or other standard of 
conduct prohibits creation of an appearance of a conflict of 
interest when selecting witnesses for a committee hearing.\117\ 
In fact, the House Ethics Manual recognizes that some actual 
conflicts of interests are inevitable: ``[s]ome conflicts of 
interest are inherent in the representative system of 
government, and are not in themselves necessarily improper or 
unethical.''\118\ Instead, Members are required to disclose 
assets based on the principle that conflicts of interest are 
best resolved by the political process.\119\ ``The objectives 
of financial disclosure are to inform the public about the 
financial interests of government officials in order to 
increase public confidence in the integrity of government and 
to deter potential conflicts of interest.''\120\
---------------------------------------------------------------------------
    \117\Under the facts in this matter, the Standards Committee 
determined that Representative Graves' conduct did not create a 
conflict of interest. In addition, even assuming arguendo that there 
was a rule prohibiting creating the appearance of a conflict of 
interest, Representative Graves' conduct would not have created such an 
appearance.
    \118\House Ethics Manual at 250 (quoting House Bipartisan Task 
Force on Ethics, Report on H.R. 3360, 101st Cong., 1st Sess. 22 (Comm. 
Print, Comm. On Rules 1989), reprinted in 135 Cong. Rec. H9253, H9259 
(daily ed. Nov. 21, 1989)).
    \119\House Ethics Manual at 251 (``Review of a Member's financial 
conduct occurs in the context of the political process'').
    \120\Id. (quoting House Comm'n on Admin. Review, Financial Ethics, 
H. Doc. 95-73, 95th Cong. 1st Sess., at 9 (1977) (hereinafter 
``Financial Ethics'') (``[p]otential conflicts of interest are best 
deterred through disclosure and the discipline of the electoral 
process.'')
---------------------------------------------------------------------------
    ``The House has required public financial disclosure by 
rule since 1968, and by statute since 1978.''\121\ Public 
disclosure of assets, financial interests, and investments is 
intended to regulate possible conflicts of interest to 
``provide the information necessary to allow Members' 
constituencies to judge their official conduct in light of 
possible financial conflicts with private holdings.''\122\
---------------------------------------------------------------------------
    \121\House Ethics Manual at 251.
    \122\Id.
---------------------------------------------------------------------------
    Thus, the timely filing of complete and accurate Financial 
Disclosure Statements is essential to the political process and 
is fundamental to the House ethics system.
    ``No federal statute, regulation or rule of the House 
absolutely prohibits a Member or House employee from holding 
assets that might conflict with or influence the performance of 
official duties.''\123\ A conflict of interest becomes 
problematic when a Member uses his position to enhance his 
personal financial interests or his personal financial 
interests impair his judgment in conducting his public duties. 
To prevent a Member's personal interest from interfering with 
his official duties, a member is required to make public 
disclosure of assets, financial interests, and 
investments.\124\
---------------------------------------------------------------------------
    \123\House Ethics Manual at 248.
    \124\House Rule XXVI; Title I of the Ethics in Government Act of 
1978 (5 U.S.C. App. para.para.101-111).
---------------------------------------------------------------------------
    ``Public disclosure is intended to provide the information 
necessary to allow Members' constituencies to judge their 
official conduct in light of possible financial conflicts with 
private holdings.''\125\ In recommending broader public 
disclosure as the preferred method of regulating possible 
conflicts of interest in lieu of other restrictions on 
investment income, the House Commission on Administrative 
Review of the 95th Congress noted:
---------------------------------------------------------------------------
    \125\House Ethics Manual at 251.

          [P]otential conflicts of interest are best deterred 
        through disclosure and the discipline of the electoral 
        process. Other approaches are flawed both in terms of 
        their reasonableness and practicality, and threaten to 
        impair, rather than to protect, the relationship 
        between the representative and the represented.\126\
---------------------------------------------------------------------------
    \126\Id. (quoting Financial Ethics at 9).

---------------------------------------------------------------------------
    As noted in the House Ethics Manual:

          A Member may often have a community of interests with 
        the Member's constituency, and may arguably have been 
        elected because of and to serve these common interests, 
        and thus would be ineffective in representing the real 
        interests of the constituents if the Member was 
        disqualified from voting on issues touching those 
        matters of mutual concern.\127\
---------------------------------------------------------------------------
    \127\House Ethics Manual at 250.

    Here, there is no evidence that Representative Graves 
failed to comply with any disclosure requirement applicable to 
him at the time of the hearing. In fact, Representative Graves' 
Financial Disclosure Statements fully and accurately reflects 
his financial interests, including his wife's 0.18% interest in 
Golden Triangle and 0.125% interest in Biofuels.\128\ The 
evidence further shows that Mr. Hurst fully complied with all 
disclosure requirements for witnesses appearing at House 
committee hearings.\129\ Moreover, the evidence shows that the 
House disclosure rules were effective, because this issue was 
immediately covered by the press.\130\
---------------------------------------------------------------------------
    \128\Rep. Graves' 2008 Financial Disclosure Statement.
    \129\COS 00013. The Standards Committee notes that OCE was made 
aware of Mr. Hurst's full compliance, but omitted that fact from its 
Report and Findings.
    \130\``Graves' Friend Gets a Soapbox,'' Paul Singer, Roll Call, 
March 9, 2009; see generally ``Family ties to ethanol plant draw 
questions for Rep. Sam Graves,'' Steve Kraske, The Kansas City Star, 
December 6, 2007.
---------------------------------------------------------------------------
    The Standards Committee concludes that Representative 
Graves' involvement with the witness selection process for the 
March 4, 2009, Small Business Committee hearing did not create 
a conflict of interest for the following reasons:
    First, neither Representative Graves nor Mrs. Graves could 
derive a financial benefit from Mr. Hurst's testimony.\131\ Mr. 
Hurst was invited to testify before the Small Business 
Committee at a hearing that was held solely as a fact-gathering 
hearing about the impact of the current economic crisis on the 
renewable fuels industry.\132\ The Small Business Committee's 
jurisdiction does not extend to any legislative function over 
the renewable fuels industry.\133\ Also, Mr. Hurst did not use 
his testimony as an opportunity to request any particular 
action from the Small Business Committee.\134\
---------------------------------------------------------------------------
    \131\See generally House Rule X, clause 1(p); see also Memorandum 
of Interview of Rep. Graves by OCE staff, June 15, 2009, para.62; 
Memorandum of Interview of Paul Sass by OCE staff, June 16, 2009, 
para.5; Memorandum of Interview of Rep. Graves by OCE staff, June 15, 
2009, para.para.72, 73.
    \132\COS 00019; COS 00065; see also, Memorandum of Interview of 
Rep. Graves by OCE staff, June 15, 2009, para.62; Memorandum of 
Interview of Paul Sass by OCE staff, June 16, 2009, para.5; Memorandum 
of Interview of Rep. Graves by OCE staff, June 15, 2009, in 
para.para.72, 73.
    \133\House Rule X, clauses 1(p), 2(b); and 3(l).
    \134\COS 00192-COS 195.
---------------------------------------------------------------------------
    Second, there is no indication Representative Graves 
actually received a financial benefit from Mr. Hurst's 
testimony. During his testimony, Mr. Hurst recommended an 
extension of the Biodiesel Blender's Credit program, inclusion 
of glycerin in the Biobased Fuel Blender's Credit program, and 
implementation of the Renewable Fuels Standard.\135\ Mr. 
Hurst's recommendations applied generally to the biofuels 
industry as a whole and not to any particular company.\136\ 
Neither the facts contained in OCE's Report and Findings nor 
the Committee's independent investigation revealed that the 
Small Business Committee took any action in relation to Mr. 
Hurst's recommendations. As stated previously, the Small 
Business Committee did not have the ability to take any action 
on Mr. Hurst's recommendation because such action was outside 
of the Small Business Committee's jurisdiction.\137\
---------------------------------------------------------------------------
    \135\Id.
    \136\Id.
    \137\Id.; House Rule X, clause 1(p).
---------------------------------------------------------------------------
    Third, assuming arguendo that Representative Graves or his 
wife benefited financially from Mr. Hurst's testimony, Mr. 
Hurst met all of the reasonable and objective requirements the 
staff established for a witness, for the March 4, 2009, Small 
Business Committee hearing.\138\ Moreover, Representative 
Graves' putative interest was not an interest unique to him but 
was instead an interest that he held as part of a large class 
of investors. Mr. Hurst's testimony addressed issues of concern 
to the members of the MSA generally, and not to any particular 
entity.\139\ In fact, the testimony presented by Mr. Hurst 
significantly overlapped with the positions taken by the 
representative of the National Biodiesel Board, another witness 
who spoke at the hearing.\140\ Thus, even if Representative 
Graves or his wife had derived a financial benefit from Mr. 
Hurst's testimony, such benefit would only have been as a 
member of a class of investors in renewable fuel companies. 
Moreover, Mrs. Graves' investments in both companies in which 
Mr. Hurst held stock were minimal. She owned a 0.18% interest 
in Golden Triangle and a 0.125% interest in Biofuels.\141\ As 
such, even if Mr. Hurst's testimony benefited only the two 
companies in which Mrs. Graves was invested, Representative 
Graves' or Mrs. Graves' personal financial interest in either 
investment would have been affected as members of a class of 
investors and not as individuals.
---------------------------------------------------------------------------
    \138\COS 00065; COS 00067; COS 00069; COS 00071; COS 00073; COS 
00082; COS 00084; Memorandum of Interview of Paul Sass by OCE staff, 
June 16, 2009, para.para.4, 11; Interview of Paul Sass by Standards 
Committee staff, September 16, 2009; Interview of Brooks Hurst by 
Standards Committee staff, September 18, 2009; Memorandum of Interview 
of Rep. Graves by OCE staff, June 16, 2009, para.13; Memorandum of 
Interview of Brooks Hurst by OCE staff, July 13, 2009, para.9.
    \139\COS 00192-COS 195.
    \140\See id.; COS 00187-00191.
    \141\COS 00061; COS 00063. Mrs. Graves was one of 400 investors in 
Biofuels LLC. See COS 00063.
---------------------------------------------------------------------------
    For all the reasons stated herein, after reviewing the 
evidence gathered by OCE and conducting its own independent 
investigation, the Standards Committee finds that 
Representative Graves did not violate any law, rule, 
regulation, or other standard of conduct applicable to him in 
connection with the invitation of Mr. Hurst to testify before 
the Small Business Committee.

            B. Analysis Based on Relevant Rules and Statutes

    Based on the facts presented by OCE's Report and Findings 
as well as the facts gathered by the Standards Committee's 
independent investigation, the Standards Committee determined 
that Representative Graves' conduct was more properly analyzed 
under House Rule 23, clause 3,\142\ and section 5 of the Code 
of Ethics.\143\ However, the Standards Committee ultimately 
determined that Representative Graves' conduct did not violate 
House Rule 23, clause 3, or section 5 of the Code of Ethics.
---------------------------------------------------------------------------
    \142\House Rule XXIII, clause 3.
    \143\Code of Ethics for Government Service, section 5. Pertinent 
portions of the Code of Ethics for Government Service can be found at 
Appendix C.
---------------------------------------------------------------------------

1. Improper Use of Official Position (House Rule 23, clause 3)

    House Rule 23, clause 3, provides:

          A Member . . . of the House may not receive 
        compensation and may not permit compensation to accrue 
        to the beneficial interest of such individual from any 
        source, the receipt of which would occur by virtue of 
        influence improperly exerted from the position of such 
        individual in Congress.\144\
---------------------------------------------------------------------------
    \144\House Rule XXIII, clause 3.

    To establish a violation under House Rule 23, clause 3, in 
connection with inviting a witness to testify before a 
committee hearing, it must be shown that a Member improperly 
used his or her official position by inviting the witness to 
appear before the committee and that the Member received a 
direct pecuniary benefit that resulted from the witness' 
testimony. After reviewing the evidence collected by OCE and 
conducting its own independent investigation, the Standards 
Committee concluded that Representative Graves did not 
improperly use his official position in connection with Mr. 
Hurst's invitation to testify before the Small Business 
Committee.
    After the minority staff of the Small Business Committee 
received notification from the majority staff that a hearing 
entitled ``The State of Renewable Fuels Industry in the Current 
Economy'' was scheduled to be held on March 4, 2009, and before 
selecting a witness, the minority staff established criteria 
for selecting potential witnesses.\145\ The criteria that the 
staff established for potential witnesses sought a witness who 
was: from Representative Graves' congressional district; 
familiar with the renewable fuels industry; and not employed by 
a company in which Representative Graves was invested.\146\ Mr. 
Hurst, who Mr. Sass originally suggested, met each of the 
requirements. Although Mr. Hurst held investments in two 
renewable energy cooperatives in which Mr. Graves was invested, 
he was not an officer or employee of either company. In 
addition, Representative Graves gave limited input as to who 
the minority staff should select to testify before the Small 
Business Committee. The final decision as to which individual 
was invited was left up to, and actually made by, the minority 
staff.\147\ Thus, the Standards Committee concluded that 
because Mr. Hurst met all of the reasonable and objective 
criteria to testify at the hearing, Representative Graves' 
involvement with selection of Mr. Hurst was not improper.
---------------------------------------------------------------------------
    \145\COS 00065; COS 00067; COS 00069; COS 00071; COS 00073; COS 
00082; COS 00084; Memorandum of Interview of Paul Sass by OCE staff, 
June 16, 2009, para.para.4, 11; Interview of Paul Sass by Standards 
Committee staff, September 16, 2009.
    \146\Id. The Standards Committee finds that the criteria developed 
by the Small Business Committee's minority staff were reasonable and 
objective.
    \147\Interview of Paul Sass by Standards Committee staff, September 
16, 2009; Memorandum of Interview of Thomas Brown by OCE staff, June 
16, 2009, para.12; Memorandum of Interview of Paul Sass by OCE staff, 
June 16, 2009, para.16. However, the Standards Committee notes that, 
even if Representative Graves had greater involvement in the selection 
of Mr. Hurst to testify at the hearing, this would not have been 
improper.
---------------------------------------------------------------------------
    Because the Standards Committee concluded that 
Representative Graves' involvement with the selection of the 
witness was not impermissible, the Standards Committee did not 
need to reach the issue of whether Representative Graves 
received any benefit in connection with Mr. Hurst's testimony. 
However, the Standards Committee notes that neither OCE nor the 
Committee's independent investigation identified any evidence 
that Representative Graves received any benefit in connection 
with Mr. Hurst's testimony.\148\ Thus, even if Representative 
Graves' involvement with the selection of the witness had been 
improper, it would not have violated House Rule 23, clause 
3.\149\
---------------------------------------------------------------------------
    \148\The Standards Committee notes that there is no evidence that 
anyone or any entity received any financial benefit as a result of Mr. 
Hurst's testimony before the Small Business Committee on March 4, 2009.
    \149\House Rule XXIII, clause 3.
---------------------------------------------------------------------------

2. Dispensing Personal Favors (Section 5 of the Code of Ethics for 
        Government Service)

    Section 5 of the Code of Ethics, provides:

          Any person in Government Service should: * * *
          V. Never discriminate unfairly by the dispensing of 
        special favors or privileges to anyone, whether for 
        remuneration or not; and never accept for [one]self or 
        [one's] family, favors or benefits under circumstances 
        which might be construed by reasonable persons as 
        influencing the performance of [one's] governmental 
        duties.\150\
---------------------------------------------------------------------------
    \150\Code of Ethics for Government Service, section 5.

    To establish a violation under section 5 of the Code of 
Ethics in connection with inviting a witness to testify before 
a committee hearing requires a showing that a Member improperly 
used his or her official position by making that 
invitation.\151\ It is not necessary for a Member to receive a 
benefit from a witness's testimony to violate section 5 of the 
Code of Ethics.\152\ After reviewing the evidence collected by 
OCE and conducting its own independent investigation, the 
Standards Committee determined that Representative Graves did 
not improperly use his official position by inviting Mr. Hurst 
to testify before the Small Business Committee.
---------------------------------------------------------------------------
    \151\Id.
    \152\Id.
---------------------------------------------------------------------------
    As noted above, Mr. Hurst met all of the reasonable and 
objective requirements the staff established for a witness for 
the March 4, 2009, Small Business Committee hearing.\153\ As 
was customary for the minority on the Small Business Committee, 
Representative Graves had limited involvement with the witness 
selection process,\154\ and the ultimate decision to invite Mr. 
Hurst was made by the minority staff, not Representative 
Graves.\155\ Thus, because Mr. Hurst met all of the reasonable 
and objective requirements the staff established for a witness 
for the March 4, 2009, Small Business Committee hearing, 
Representative Graves' involvement in the witness selection 
process did not discriminate unfairly against other potential 
witnesses by dispensing a special favor to Mr. Hurst.
---------------------------------------------------------------------------
    \153\COS 00065; COS 00067; COS 00069; COS 00071; COS 00073; COS 
00082; COS 00084; Memorandum of Interview of Paul Sass by OCE staff, 
June 16, 2009, para.para.4, 11; Interview of Paul Sass by Standards 
Committee staff, September 16, 2009; Interview of Brooks Hurst by 
Standards Committee staff, September 18, 2009; Memorandum of Interview 
of Rep. Graves by OCE staff, June 16, 2009, para.13; Memorandum of 
Interview of Brooks Hurst by OCE staff, July 13, 2009, para.9.
    \154\Memorandum of Interview of Rep. Graves by OCE staff, June 15, 
2009, para.para.3, 4; Memorandum of Interview of Paul Sass by OCE 
staff, June 16, 2009, para.57.
    \155\Interview of Paul Sass by Standards Committee staff, September 
16, 2009; Memorandum of Interview of Thomas Brown by OCE staff, June 
16, 2009, para.12; Memorandum of Interview of Paul Sass by OCE staff, 
June 16, 2009, para.16. However, the Standards Committee notes that, 
even if Representative Graves had greater involvement in the selection 
of Mr. Hurst to testify at the hearing, this would not have been 
improper.
---------------------------------------------------------------------------
    Accordingly, the Standards Committee concluded that 
Representative Graves' involvement in the witness selection 
process was not improper where Mr. Hurst, an individual who 
held investments in two companies in which Representative 
Graves' wife also held investments, was selected based on Mr. 
Hurst's qualifications, as measured by objective and reasonable 
witness selection criteria. As a result, Representative Graves 
did not violate Section 5 of the Code of Ethics.

                   V. CONCLUSIONS AND RECOMMENDATIONS

    OCE reviewed Representative Graves' conduct pursuant to 
House Rule 3, clause 1; House Rule 23, clause 2; and what OCE 
identified as ``House precedent on conflicts of interest.'' For 
this reason, the Standards Committee also reviewed 
Representative Graves' conduct pursuant to these rules and 
standards of conduct. Based on the facts presented in OCE's 
Report and Findings, as well as the facts gathered by the 
Standards Committee's independent investigation, the Standards 
Committee concluded that Representative Graves' conduct did not 
implicate any of the rules or standards of conduct identified 
by OCE. Thus, the Standards Committee further determined that 
OCE analyzed Representative Graves' conduct pursuant to the 
incorrect rules.
    Instead, the Standards Committee determined that 
Representative Graves' conduct should more properly have been 
analyzed under House Rule 23, clause 3; and section 5 of the 
Code of Ethics for Government Service (Code of Ethics). After 
reviewing Representative Graves' conduct pursuant to House Rule 
23, clause 3, and section 5 of the Code of Ethics, the 
Standards Committee concluded that Representative Graves' 
involvement with the witness selection process for the March 4, 
2009, Small Business Committee hearing did not violate any 
applicable rule or standard of conduct.
    In the view of the Standards Committee's findings and 
conclusions, no further action is recommended, and the 
Committee considers the matter closed.

                            VI. OCE's REVIEW

    While reviewing the materials forwarded to it by OCE, the 
Standards Committee was deeply disappointed to identify several 
procedural and substantive deficiencies in OCE's review, some 
of which would appear to have been fatal to OCE's ability to 
continue its review. Regretfully, the Standards Committee 
believes that it is necessary for the proper administration of 
the House ethics process and the due process rights of any 
current or future subject of an OCE investigation to identify 
these unfortunate deficiencies in this report. In so doing, the 
Standards Committee intends only to identify the issues it 
identified in the course of its review and does not, in any 
way, intend to ascribe to OCE any intent, motive or bad faith 
with respect to the deficiencies identified below.

                       A. Summary of OCE's Review

    On March 26, 2009, OCE initiated its preliminary review 
into allegations regarding the conduct of Representative 
Graves.\156\ During the preliminary review period, the OCE 
Board timely voted to initiate a second-phase review.\157\ 
Unfortunately, during the course of OCE's second-phase review, 
OCE repeatedly failed to comply with deadlines mandated by 
OCE's authorizing resolution and its own rules.\158\ OCE's 
disregard for these deadlines resulted in OCE failing to 
terminate the matter as required by rule and conducting key 
phases of its investigatory work outside of the jurisdiction 
granted to OCE by its authorizing resolution.\159\
---------------------------------------------------------------------------
    \156\OCE Review No. 09-7000, Findings of Fact and Citations of Law 
(OCE Findings), para.9. OCE Findings can be found at Appendix E.
    \157\OCE Findings, para. 10; House Resolution 895, 110th Cong., 2nd 
Sess. (H. Res. 895), section 1(c)(1)(B) and (C) (110th Cong., March 11, 
2008); Rules of the Office of Congressional Ethics, 7(C) and (D) 
(hereinafter OCE Rules). Copies of H. Res. 895 and the OCE Rules can be 
found at Appendix C.
    \158\See, e.g., OCE Findings, para.para.10 and 11; H. Res. 895, 
section 1(c)(1)(C) and section 1(c)(2)(A); OCE Rule 8(C).
    \159\OCE Rule 8(C) and H. Res. 895, section I, clause (c)(1)(C); 
see e.g., Memorandum of Interview of Rep. Graves by OCE staff, June 15, 
2009; Memorandum of Interview of Brooks Hurst by OCE staff, July 13, 
2009; Memorandum of Interview of Thomas Brown by OCE staff, June 16, 
2009; Memorandum of Interview of Paul Sass by OCE staff, June 16, 2009; 
and Memorandum of Interview of Jason Klindt by OCE staff, June 16, 
2009. Pertinent portions of the OCE's memoranda of interview can be 
found at Appendix D.
---------------------------------------------------------------------------
    On August 6, 2009, OCE forwarded to the Standards Committee 
its Report and Findings recommending further review of 
allegations involving Representative Graves.\160\ OCE's 
``report'' consisted of a one-page statement of the nature of 
Representative Graves' alleged violation. OCE's ``findings'' 
consisted of a more detailed summary of OCE's review. At the 
same time that OCE forwarded its Report and Findings to the 
Standards Committee, OCE also sent a copy of its one-page 
Report to Representative Graves. However, OCE did not provide 
Representative Graves with a copy of its Findings.
---------------------------------------------------------------------------
    \160\Letter from David E. Skaggs and Porter J. Goss to Zoe Lofgren 
and Jo Bonner, August 6, 2009. A copy of the letter can be found at 
Appendix E.
---------------------------------------------------------------------------
    After reviewing OCE's Report and Findings, the Standards 
Committee provided Representative Graves with a copy of OCE's 
Report and Findings and gave Representative Graves an 
opportunity to submit a response to OCE's Report and Findings. 
Representative Graves submitted a response, in which he: 
presented additional facts that were not included in OCE's 
Findings; raised procedural concerns with OCE's review; took 
issue with certain of OCE's factual and legal conclusions; and 
requested that the Standards Committee not make public OCE's 
Report and Findings in the interests of justice, fundamental 
fairness, and due process.\161\
---------------------------------------------------------------------------
    \161\COS 00126-COS 00149.
---------------------------------------------------------------------------
    The Standards Committee reviewed the matter discussed in 
OCE's Report and Findings without prejudice or presumptions as 
to the merits of the allegations.\162\ As such, the Standards 
Committee's findings and conclusions with regard to 
Representative Graves were informed by, but made independent 
of, OCE's Report and Findings. After reviewing OCE's Report and 
Findings and conducting its own independent investigation, the 
Standards Committee was disappointed to find that OCE's review 
was fundamentally flawed.
---------------------------------------------------------------------------
    \162\Standards Committee Rule 17A(a). The Standards Committee Rules 
can be found at Appendix C.
---------------------------------------------------------------------------
    First, as noted above, OCE repeatedly violated deadlines 
found in OCE's authorizing resolution.\163\ Second, OCE's 
findings unfortunately revealed the names and other identifying 
information of several cooperating witnesses in contravention 
of OCE's authorizing resolution.\164\ Third, OCE forwarded the 
matter to the Standards Committee for further review without 
finding a ``substantial reason to believe'' that there was a 
violation of any relevant, substantive rule or other standard 
of conduct applicable to Representative Graves.\165\ Fourth, 
OCE's Findings improperly made conclusions regarding the truth 
of statements made by cooperating witnesses, including 
Representative Graves.\166\ Fifth, OCE ignored relevant 
evidence provided by Representative Graves to OCE. Finally, the 
Standards Committee discovered materials within OCE's Report 
and Findings that were potentially favorable or exculpatory to 
Representative Graves, but which OCE did not provide to 
Representative Graves.\167\
---------------------------------------------------------------------------
    \163\See OCE Findings, 9-13; See Memorandum of Interview of Rep. 
Graves by OCE staff, June 15, 2009; Memorandum of Interview of Brooks 
Hurst by OCE staff, July 13, 2009; Memorandum of Interview of Thomas 
Brown by OCE staff, June 16, 2009; Memorandum of Interview of Paul Sass 
by OCE staff, June 16, 2009; and Memorandum of Interview of Jason 
Klindt by OCE staff, June 16, 2009; H. Res. Section 1, clause (c)(1) 
and (c)(2).
    \164\H. Res. 895, section 1, clause (c)(1)(A); see also Special 
Task Force on Ethics Enforcement, Report of the Democratic Members of 
the Special Task Force on Ethics Enforcement, 110th Cong., 1st Sess., 
at 16 (2007) (hereinafter Capuano Report). The Special Task Force on 
Ethics Enforcement was the task force instructed to study creation of 
an independent ethics enforcement entity within the House. A copy of 
the Capuano Report can be found at Appendix C.
    \165\OCE Rule 9(A); OCE Findings, para.para.80-82.
    \166\H. Res. 895, section 1, clause (c)(2)(C)(i)(II)(dd).
    \167\Interview of Rep. Graves' Counsel by Standards Committee 
staff, September 17, 2009.
---------------------------------------------------------------------------
    Because of the unfortunate flaws in OCE's Report and 
Findings, the Standards Committee was confronted with a 
potential conflict between the requirement that the Standards 
Committee make OCE's Report and Findings publicly 
available,\168\ and the due process and privacy protections 
afforded to Representative Graves and OCE's cooperating 
witnesses by the Standards Committee Rules,\169\ OCE's 
authorizing resolution,\170\ and OCE's rules.\171\ The 
Standards Committee was concerned that publication of OCE's 
Report and Findings would further compound OCE's unfortunate 
failure to follow its authorizing resolution. However, the 
Standards Committee concluded that, on balance, the public 
interest was served by publication of OCE's Report and Findings 
in this case, and thus the Standards Committee declined to 
withhold publication of OCE's Report and Findings.
---------------------------------------------------------------------------
    \168\Standards Committee Rule 17A(c).
    \169\Standards Committee Rule 17A and 25.
    \170\H. Res. 895, section 1, clause (c)(2)(C).
    \171\OCE Rules 1, 4, 8, 9, and 11.
---------------------------------------------------------------------------

               B. OCE's Authorizing Resolution and Rules

    OCE's jurisdiction to review a matter is given only by 
virtue of OCE's authorizing resolution.\172\ If OCE acts in 
contravention of its authorizing resolution, OCE loses 
jurisdiction over a matter.\173\
---------------------------------------------------------------------------
    \172\See generally U.S. v. Watkins, 354 U.S. 178, 201 (1957) 
(holding that with respect to ``investigating committees'' Congress is 
``require[d] . . . to . . . spell out that group's jurisdiction and 
purpose'' and that those ``instructions are embodied in the authorizing 
resolution'').
    \173\See generally U.S. v. Rumely, 345 U.S. 41, 44 (1953) 
(upholding reversal of conviction for refusal to answer questions of 
select committee of Congress because questions were outside of the 
scope of the select committee's authorizing resolution, which was the 
``controlling charter of the committee's powers'' and thus ``[i]ts 
right to exact testimony and to call for the production of documents 
must be found'' in the resolution).
---------------------------------------------------------------------------
    OCE's authorizing resolution limits OCE's reviewing 
authority to ``any alleged violation by a Member . . . of any 
law, rule, regulation, or other standard of conduct applicable 
to the conduct of such Member . . . in the performance of his 
duties or the discharge of his responsibilities[.]''\174\ In 
accord with this resolution, OCE's rules state that:
---------------------------------------------------------------------------
    \174\H. Res. 895, section 1, clause (c)(2)(C)(i)(II)(dd).

          The Board shall refer a matter to the Standards 
        Committee for further review if it determines there is 
        a substantial reason to believe the allegations based 
        on all the information then known to the Board. 
        However, in the event the Office is unable to reach 
        that determination, but the Board does determine there 
        is probable cause to believe the allegations, the Board 
        may refer the matter to the Standards Committee for 
        further review.\175\
---------------------------------------------------------------------------
    \175\OCE Rule 9(A) (emphasis in original).

    OCE's preliminary review must be completed within 30 days 
of receipt of a request to commence a preliminary review.\176\ 
If OCE's Board does not vote to initiate a second-phase review 
by the end of the preliminary review period, the matter is 
terminated.\177\ OCE's second-phase review commences the day 
after the preliminary review period expires.\178\ OCE's second-
phase review terminates in 45 days,\179\ unless OCE votes to 
extend the second-phase review for an additional 14 days.\180\ 
The vote to extend must occur before the second-phase 
terminates.\181\ Once OCE's second-phase review concludes, 
OCE's legal authority to conduct further interviews or 
investigation is suspect.\182\
---------------------------------------------------------------------------
    \176\H. Res. 895, section 1(c)(1)(B); OCE Rule 7(D). OCE must 
initiate a preliminary review within seven days of the request to 
commence the review. H. Res. 895, section 1(c)(1)(A); OCE Rule 7(C).
    \177\H. Res. 895, section 1(c)(1)(C).
    \178\H. Res. 895, section 1(c)(1)(C); OCE Rule 8(C). Upon receiving 
OCE's Report and Findings, the Standards Committee discovered that the 
Standards Committee and OCE had differing interpretations as to when 
OCE's second-phase review commenced. Accordingly, the Standards 
Committee's staff and OCE's staff met with the House Parliamentarians 
to ascertain the correct interpretation. In the meeting the House 
Parliamentarian determined that if OCE's Board votes to initiate a 
second-phase review, the second-phase review of that matter begins 
immediately following the end of OCE's 30-day preliminary review 
period.
    \179\OCE Rule 8(C) and H. Res. 895, section 1, clause (c)(1)(C).
    \180\Rule 8(C) and H. Res. 895, section 1, clause (c)(2)(A)(ii).
    \181\Id.
    \182\Id.; see generally Rumely, 345 U.S. at 44.
---------------------------------------------------------------------------
    Upon completion of a second-phase review, OCE is 
``authorized and directed to'' transmit a written report to the 
Standards Committee. This written report must be:
          composed solely of--
                  (aa) a recommendation that the committee 
                should dismiss the matter that was the subject 
                of such review;
                  (bb) a statement that the matter requires 
                further review; or
                  (cc) a statement that the matter is 
                unresolved because of a tie vote; and
        the number of members voting in the affirmative and in 
        the negative and a statement of the nature of the 
        review and the individual who is subject of the 
        review[.]\183\
---------------------------------------------------------------------------
    \183\H. Res. 895, section 1(c)(2)(C)(i)(I).
---------------------------------------------------------------------------
    Along with its report, OCE is also ``authorized and 
directed to'' transmit its findings, if any, to the Standards 
Committee. OCE's findings must be:
          composed solely of--
                  (aa) any findings of fact;
                  (bb) a description of any relevant 
                information that it was unable to obtain or 
                witnesses who it was unable to interview, and 
                the reasons therefor;
                  (cc) a recommendation for the issuance of 
                subpoenas where appropriate, if any; and
                  (dd) a citation of any relevant law, rule, 
                regulation, or standard of conduct;
        but not the names of any cooperative witnesses or any 
        conclusions regarding the validity of the allegations 
        upon which it is based or the guilt or innocence of the 
        individual who is the subject of the review[.]\184\
---------------------------------------------------------------------------
    \184\H. Res. 895, section 1(c)(2)(C)(i)(II).
---------------------------------------------------------------------------
    The restriction on including the names of cooperative 
witnesses in OCE's Findings is further explained in the Capuano 
Report, which states:

          Cooperative witnesses, who will not be named by the 
        board within the Findings in order to preserve 
        confidentiality, should be listed within the supporting 
        documents for the Standards Committee's information. 
        These materials shall not be published unless the 
        Standards Committee deems it necessary and 
        appropriate.\185\
---------------------------------------------------------------------------
    \185\See Capuano Report at 16.

    Along with its Report and Findings, OCE is also 
``authorized and directed to'' transmit ``any supporting 
documentation'' to the Standards Committee.\186\ OCE is also 
required to ``promptly provide to a subject any exculpatory 
information received.''\187\ Unfortunately, to date, the 
Committee has not been provided with any supporting 
documentation related to this matter.\188\
---------------------------------------------------------------------------
    \186\H. Res. 895, section 1(c)(2)(C)(i)(III).
    \187\OCE Rule 4(F).
    \188\The Standards Committee previously asked OCE for supporting 
documentation. OCE staff informed the Standards Committee that OCE does 
not possess any ``supporting documents.'' Subsequently, OCE has also 
stated that they do not possess any supporting documents that are in 
their view, ``germane.''
---------------------------------------------------------------------------

                 C. Procedural History of OCE's Review

    On March 26, 2009, two members of the OCE Board made a 
request to commence a preliminary review into allegations 
regarding the conduct of Representative Graves.\189\ OCE 
initiated its preliminary review in this matter on April 2, 
2009.\190\ Pursuant to OCE's authorizing resolution, OCE's 
preliminary review concluded on April 25, 2009. On April 24, 
2009, at least three members of the OCE Board voted to initiate 
a second-phase review in this matter.\191\
---------------------------------------------------------------------------
    \189\OCE Findings, para.9.
    \190\OCE Findings, para.9. The Committee notes this date is 
inconsistent with the Letter from David E. Skaggs and Porter J. Goss to 
Zoe Lofgren and Jo Bonner dated March 30, 2009, which indicated OCE had 
already initiated a preliminary review.
    \191\OCE Findings, para.10. These dates are taken directly from the 
``Procedural History'' section of OCE's Findings.
---------------------------------------------------------------------------
    Pursuant to OCE's authorizing resolution and OCE's policies 
as stated to the Committee, OCE's second-phase review should 
have begun on April 26, 2009, and the second-phase review 
should have concluded on June 9, 2009. On April 27, 2009, OCE 
sent a letter to the Standards Committee noting that it had 
voted to initiate a second-phase review in the matter 
concerning Representative Graves. Unfortunately, OCE's letter 
stated that the second-phase review would not ``commence'' 
until May 2, 2009.\192\ On June 12, 2009 three days after the 
second-phase review period ended, the OCE Board voted to extend 
the second-phase review for two additional weeks.\193\ 
Unfortunately, OCE interviewed a witness on June 15, 2009,\194\ 
six days after the second-phase review period ended. OCE also 
interviewed three more witnesses on June 16, 2009,\195\ seven 
days after the second-phase review period should have ended.
---------------------------------------------------------------------------
    \192\Letter from David E. Skaggs and Porter J. Goss to Zoe Lofgren 
and Jo Bonner, April 27, 2009. Neither OCE's rules nor its policies 
permit OCE to delay the start of OCE's second-phase review period 
beyond the end of the preliminary review period. See United States ex 
rel. Accardi v. Shaughnessy, 347 U.S. 260, 268 (1954) (holding that 
having stated the manner in which it is to exercise its discretion, an 
agency cannot refuse to follow its own rules); Wilson v. Commissioner 
of Social Sec., 378 F.3d 541, 545 (6th Cir. 2004) (holding that 
agencies are bound to follow their own regulations and that an agency's 
failure to follow its own regulations, even when those regulations are 
more generous than necessary, tends to cause unjust discrimination and 
deny adequate notice); Sameena Inc. v. United States Air Force, 147 
F.3d 1148, 1153 (9th Cir. 1998) (``[t]he Supreme Court has long 
recognized that a federal agency is obliged to abide by the regulations 
it promulgates. An agency's failure to follow its own regulations 
`tends to cause unjust discrimination and deny adequate notice' and 
consequently may result in a violation of an individual's 
constitutional right to due process. Where a prescribed procedure is 
intended to protect the interests of a party before the agency, `even 
though generous beyond the requirements that bind such agency, that 
procedure must be scrupulously observed.''') (internal citations and 
quotations omitted)).
    \193\OCE Findings, para.10.
    \194\See Memorandum of Interview of Rep. Graves by OCE staff, June 
15, 2009.
    \195\See Memorandum of Interview of Thomas Brown by OCE staff, June 
16, 2009; Memorandum of Interview of Paul Sass by OCE staff, June 16, 
2009; and Memorandum of Interview of Jason Klindt by OCE staff, June 
16, 2009; and Memorandum of Interview of Brooks Hurst by OCE staff, 
July 13, 2009.
---------------------------------------------------------------------------
    On June 30, 2009, eighteen days after OCE voted to extend 
the second-phase review period for fourteen days, OCE completed 
its second-phase review.\196\ However, OCE interviewed a 
witness on July 13, 2009.\197\ This interview occurred thirteen 
days after its second-phase review ended according to OCE, and 
thirty-four days after the second-phase review period should 
have ended by rule. As such, it was untimely, and thus 
conducted outside of OCE's legal authority, even by OCE's own 
incorrect calculation of the applicable dates. On July 24, 
2009, 120 days after two members of the OCE Board made a 
request to commence a preliminary review, OCE's Board adopted a 
Report and Findings and ordered the Report and Findings to be 
transmitted to the Standards Committee.\198\
---------------------------------------------------------------------------
    \196\OCE Findings, para.11.
    \197\See Memorandum of Interview of Brooks Hurst by OCE staff, July 
13, 2009. OCE's unfortunate disregard for the deadlines mandated by its 
authorizing resolution raises the question of whether OCE was required, 
under the OCE Rule requiring OCE to disclose exculpatory materials to 
subject members (OCE Rule 4(F)), to disclose to Representative Graves 
that OCE missed strict deadlines and conducted portions of its 
investigation outside of the time permitted.
    \198\ OCE Report. The Standards Committee notes that the Capuano 
Report stated that ``Members of the Task Force believe that the 
timeline requirements instituted by the new process are critical: 
matters will spend at most three months under consideration by the 
board of the OCE before being referred to the Standards Committee for 
resolution.'' Capuano Report at 14.
---------------------------------------------------------------------------

                      D. OCE's Report and Findings

    On August 6, 2009, OCE forwarded to the Standards Committee 
a Report and Findings recommending further review of 
allegations involving Representative Graves.\199\ OCE's Report 
and Findings relating to Representative Graves consisted of 
approximately 169 pages. Only one page of the 169 pages is the 
``report.'' Pages 5 through 22 consist of OCE's narrative 
summary of the ``findings,'' while the remaining 145 pages 
consist of documents cited in the narrative summary, including 
emails collected by OCE during its review, memoranda of 
interviews of cooperating witnesses (that have never been shown 
to or adopted by the witnesses interviewed),\200\ newspaper 
articles, and other miscellaneous materials. Unfortunately, OCE 
did not forward any ``supporting documents'' to the Standards 
Committee.\201\ OCE only provided Representative Graves with 
the one-page report, but did not provide him with the Findings 
or any other documents.\202\
---------------------------------------------------------------------------
    \199\Letter from David E. Skaggs and Porter J. Goss to Zoe Lofgren 
and Jo Bonner, August 6, 2009.
    \200\The Standards Committee notes that OCE's witness interviews 
are neither transcribed nor videotaped. Instead, the only record of 
OCE's witness interviews is found in memoranda of interviews reflecting 
OCE's staff's impressions of the interview.
    \201\As noted previously, the Standards Committee asked OCE for its 
supporting documentation, but OCE staff informed the Standards 
Committee that OCE does not possess any ``supporting documents'' and 
later that OCE does not possess any ``supporting documents'' that are 
``germane.''
    \202\Interview of Rep. Graves' Counsel by Standards Committee 
staff, September 17, 2009.
---------------------------------------------------------------------------

1. OCE's Report

    OCE's one-page report--the only document forwarded to 
Representative Graves--identified the subject of OCE's review 
as Representative Graves and the ``nature of the alleged 
violation'' as:

          Representative Sam Graves, Ranking Member of the 
        Committee on Small Business, invited Witness A to 
        testify at a Committee hearing on ``The State of 
        Renewable Fuels Industry in the Current Economy.'' The 
        hearing was held on March 4, 2009. Witness A and 
        Representative Graves' wife, Lesley Graves, both hold 
        financial interests in the same renewable fuels plants 
        in Missouri. Representative Graves' conduct may have 
        violated House Rule 23 and House precedent regarding 
        conflict of interest.\203\
---------------------------------------------------------------------------
    \203\OCE Report.

    OCE's Report did not provide any additional statement 
regarding the substantive allegations underlying OCE's 
review,\204\ such as which provision of House Rule 23 was 
allegedly implicated by Representative Graves' conduct.\205\ 
OCE's Report recommended ``that the Committee on Standards of 
Official Conduct further review the above described allegations 
concerning Representative Graves.''\206\
---------------------------------------------------------------------------
    \204\Id.
    \205\The Standards Committee notes that House Rule 23 contains 
eighteen distinct provisions by which a Member shall abide.
    \206\OCE Report.
---------------------------------------------------------------------------

2. OCE's Findings

    OCE's Findings, which were not forwarded to Representative 
Graves, stated that the ``Code of Official Conduct'' relevant 
to Representative Graves'' conduct included:

          Under House Rule 23, clause 2, Members ``shall adhere 
        to the spirit and the letter of the Rules of the House 
        . . .''
          Under House Rule 3, clause 1, ``Every Member . . . 
        shall vote on each question put, unless he has a direct 
        personal or pecuniary interest in the event of such 
        question.''
          The House Ethics Manual advises ``sponsoring 
        legislation, advocating or participating in an action 
        by a House Committee, or contacting an executive branch 
        agency . . . entails a degree of advocacy above and 
        beyond that involved in voting, and thus a Member's 
        decision on whether to take any such action on a matter 
        that may affect his or her personal financial interests 
        requires added circumspection.''
          The House Ethics Manual further advises that Members 
        should guard against even the appearance of any 
        impropriety or conflict of interest because such 
        actions may adversely affect public perceptions and 
        confidence.\207\
---------------------------------------------------------------------------
    \207\OCE Findings, para.17 (italics in original) (quoting House 
Rule 23, clause 2; House Rule 3, clause 1; House Ethics Manual, at 
237).

---------------------------------------------------------------------------
    OCE's Findings conclude that:

        there is substantial reason to believe that an 
        appearance of conflict of interest was created when 
        Representative Graves invited . . . a friend of the 
        Representative's who was invested in the same ethanol 
        and biodiesel cooperatives as his wife, to testify 
        before the Committee on Small Business.\208\
---------------------------------------------------------------------------
    \208\Findings, para.2.

    OCE's Findings further concluded that ``the guidance in the 
House Ethics Manual . . . would compel Representative Graves to 
disclose the financial interests he shared with [Mr. Hurst] at 
the time of the Committee hearing or refrain from extending 
[Mr. Hurst] an invitation to appear.''\209\
---------------------------------------------------------------------------
    \209\OCE Findings, para.81.
---------------------------------------------------------------------------
    However, OCE's Findings also state that:

        any disqualifying interest that Representative Graves 
        had in this matter would likely have affected 
        Representative Graves only as a member of a class; 
        therefore, there is not substantial reason to believe 
        that Representative Graves' invitation to [Mr. Hurst] 
        violated the spirit of House Rule 3.\210\
---------------------------------------------------------------------------
    \210\OCE Findings, para.82.
---------------------------------------------------------------------------

               E. The Standards Committee's Investigation


1. Standards Committee's Activities

    In addition to reviewing OCE's Report and Findings, the 
Standards Committee conducted its own independent 
investigation. During the course of its investigation, the 
Standards Committee sought and received pertinent documents 
from relevant witnesses on a voluntary basis. The Standards 
Committee also conducted three voluntary interviews of relevant 
witnesses.\211\
---------------------------------------------------------------------------
    \211\Interview of Paul Sass by Standards Committee staff, September 
16, 2009; Interview of Brooks Hurst by Standards Committee staff, 
September 18, 2009; Interview of Michael Day by Standards Committee 
staff, September 25, 2009.
---------------------------------------------------------------------------
    If OCE properly refers a report and findings recommending 
further review to the Standards Committee, within 45 days the 
Standards Committee may either vote to empanel an investigative 
subcommittee or vote to withhold the Report and Findings for an 
additional 45 days.\212\ If the Standards Committee does not 
take either of those actions within 45 days, the Standards 
Committee must make OCE's properly referred report and findings 
public.\213\ Any release of OCE's report and findings may be 
accompanied by a report by the Standards Committee regarding 
the matter discussed in OCE's report and findings.\214\
---------------------------------------------------------------------------
    \212\House Rule XI, clause 3(b)(8)(A); Standards Committee Rule 
17A(c)(1). Pertinent portions of the House Rules can be found at 
Appendix C.
    \213\House Rule XI, clause 3(b)(8)(A); Standards Committee Rule 
17A(c)(1). If the Standards Committee votes to withhold the report and 
findings for an additional 45 days and does not empanel an 
investigative subcommittee within the additional 45-day time period, 
the Standards Committee must then make OCE's report and findings 
public. House Rule XI, clause 3(b)(8)(A); Standards Committee Rule 
17A(c)(1).
    \214\House Rule XI, clause 3(b)(8)(A). Any public release of OCE's 
findings must be made by the Standards Committee. OCE has no authority 
to publicly release its report and findings, nor does OCE have any 
authority to publicly comment on its report and findings or the matters 
contained therein at any time.
---------------------------------------------------------------------------
    On September 15, 2009, the Standards Committee unanimously 
voted to withhold OCE's Report and Findings for an additional 
45 days.\215\ In its press statement, released the same day, 
the Standards Committee explained that it had two reasons for 
voting to extend the matter.\216\ The Standards Committee's 
first reason was that:
---------------------------------------------------------------------------
    \215\Statement of the Chair and Ranking Republican Member of the 
Committee on Standards of Official Conduct Regarding Representative Sam 
Graves, September 16, 2009.
    \216\Id.

        the Office of Congressional Ethics did not find a 
        ``substantial reason to believe'' that there was a 
        substantive violation of any provision of the Code of 
        Official Conduct or any law, rule, regulation, or other 
        standard of conduct applicable to Representative 
        Graves' conduct in the performance of his duties or the 
        discharge of his responsibilities. Nevertheless, it 
        referred the matter to the Committee for further 
        review.\217\
---------------------------------------------------------------------------
    \217\Id.

The Standards Committee's second reason was that it had 
``identified materials in the Office of Congressional Ethics' 
report and findings that may contain exculpatory evidence, 
which OCE never provided to Representative Graves.''\218\ The 
Standards Committee unanimously voted to extend the matter ``to 
provide Representative Graves with potentially favorable or 
exculpatory materials, which the Committee understands, in the 
interests of justice, should have been provided to 
Representative Graves pursuant to Office of Congressional 
Ethics Rule 4(F).''\219\ The Standards Committee further noted 
that ``Committee Rule 25 requires us to disclose these 
materials to Representative Graves.''\220\
---------------------------------------------------------------------------
    \218\Id
    \219\Id.
    \220\Id.
---------------------------------------------------------------------------
    On September 16, 2009, the Standards Committee forwarded 
OCE's Report and Findings to Representative Graves and offered 
Representative Graves the opportunity to respond to OCE's 
Report and Findings within 15 days.\221\ Before the expiration 
of the 15-day response period, Representative Graves sought an 
extension of one business day, which the Standards Committee 
granted. Representative Graves' counsel submitted a response to 
OCE's Report and Findings on October 5, 2009.\222\
---------------------------------------------------------------------------
    \221\Letter from Blake Chisam, Chief Counsel and Staff Director, to 
Rep. Graves, September 16, 2009.
    \222\COS 00126-COS 00169. At the request of the Standards 
Committee, Representative Graves adopted his counsel's submission by 
oath or affirmation. See Affirmation of Rep. Graves (October 6, 2009).
---------------------------------------------------------------------------

2. Representative Graves' Submission

    The Standards Committee was disappointed to find that 
Representative Graves' submission presented facts that were not 
included in OCE's Findings, raised procedural concerns with 
OCE's review, and took issue with certain of OCE's factual and 
legal conclusions. Representative Graves' submission also 
requested that the Standards Committee not make public OCE's 
Report and Findings in the interests of justice, fundamental 
fairness, and due process.\223\
---------------------------------------------------------------------------
    \223\COS 00130.
---------------------------------------------------------------------------
    The Standards Committee gave careful consideration to 
Representative Graves' request. The Standards Committee was 
concerned that many of the regrettable flaws in OCE's Report 
and Findings created an unfortunate conflict between the 
publication requirement in the Standards Committee's Rules\224\ 
and the due process and privacy protections afforded to 
Representative Graves and OCE's cooperating witnesses by OCE's 
authorizing resolution,\225\ OCE's Rules,\226\ and the 
Standards Committee Rules.\227\ Given these regrettable flaws, 
the Standards Committee was concerned that publication of OCE's 
Report and Findings would further compound OCE's apparent 
violations of its authorizing resolution. However, despite the 
strong arguments against release of OCE's Report and Findings, 
the Standards Committee declined to withhold publication of 
OCE's Report and Findings. Instead, the Standards Committee 
concluded that its concerns with the conflict created by 
releasing a fundamentally flawed Report and Findings were 
outweighed by the interests to the House, and the public, in 
ensuring accountability and transparency with regard to OCE and 
OCE's practices. The Standards Committee notes that its 
publication of this Report and Findings should not be viewed as 
determinative of whether this matter was legally referred to 
the Standards Committee such that it triggered the Standards 
Committee's duty under House Rule 11, clause 3(b)(8)(A) to 
publicly disclose OCE's Report and Findings.
---------------------------------------------------------------------------
    \224\Standards Committee Rule 17A(c).
    \225\H. Res. 895, section 1, clause (c)(2)(C).
    \226\OCE Rules 1, 4, 8, 9, and 11.
    \227\Standards Committee Rule 17A and 25.
---------------------------------------------------------------------------
    a. New facts presented by Representative Graves:
          i. Before OCE's second-phase review period expired, 
        Representative Graves gave to OCE a memorandum 
        describing the rules pertaining to disclosure by 
        witnesses testifying before the Small Business 
        Committee and explaining that Mr. Hurst complied with 
        all such rules.\228\
---------------------------------------------------------------------------
    \228\COS 00133. Representative Graves provided the memorandum, 
which was prepared in the context of the investigation, to the 
Standards Committee. The Standards Committee notes that OCE did not 
discuss this memorandum in its Findings. The Standards Committee also 
notes that OCE never provided the memorandum, nor any ``supporting 
documents'' to the Standards Committee. The Standards Committee is 
puzzled by the fact that OCE did not incorporate this information into 
its Findings for public disclosure. The Standards Committee is also 
troubled by the transparency concerns inherent in OCE potentially 
withholding relevant information from the Standards Committee.
---------------------------------------------------------------------------
          ii. The Small Business Committee has never inquired 
        into potential witnesses' financial investments or 
        financial dealings that the witness may have in common 
        with a member of the committee or a member's 
        spouse.\229\
---------------------------------------------------------------------------
    \229\COS 00134.
---------------------------------------------------------------------------
          iii. Mr. Hurst told OCE that he never discussed 
        specific investments with Representative Graves and 
        that he was not aware of what investments 
        Representative Graves or his wife had.\230\
---------------------------------------------------------------------------
    \230\COS 00137.
---------------------------------------------------------------------------
    b. Procedural arguments made by Representative Graves:
          i. OCE only disclosed to Representative Graves that 
        it was reviewing his conduct with respect to House Rule 
        23 generally. It did not cite to any specific provision 
        of House Rule 23, nor to House Rule 3. Thus, OCE failed 
        to accurately advise Representative Graves of the rules 
        or standards of conduct that he was alleged to have 
        violated.\231\
---------------------------------------------------------------------------
    \231\COS 00127-COS 00129.
---------------------------------------------------------------------------
          ii. OCE violated OCE Rules 4(F) and 5 by failing to 
        provide exculpatory information to Representative 
        Graves.\232\
---------------------------------------------------------------------------
    \232\COS 00139-COS 00141.
---------------------------------------------------------------------------
          iii. OCE conducted its investigation outside of its 
        jurisdictional time limitations.\233\
---------------------------------------------------------------------------
    \233\COS 00141-COS 00144.
---------------------------------------------------------------------------
          iv. OCE's review was outside of its jurisdiction 
        because Representative Graves' alleged conduct did not 
        violate any ``law, rule, regulation, or other standard 
        of conduct . . . applicable to [him] in the performance 
        of his . . . duties or the discharge of his . . . 
        responsibilities.''\234\
---------------------------------------------------------------------------
    \234\COS 00145; COS 00146.
---------------------------------------------------------------------------
          v. OCE's Report and Findings violated Standards 
        Committee Rule 15(a)(4) because it contained 
        ``innuendo, speculative assertions, and conclusory 
        statements.''\235\
---------------------------------------------------------------------------
    \235\COS 00146-COS 00147.
---------------------------------------------------------------------------
          vi. OCE failed to disclose to Representative Graves 
        that the information he provided to OCE might be 
        publicly disclosed ``whether it was germane to the 
        investigation or not.''\236\
---------------------------------------------------------------------------
    \236\COS 00148.
---------------------------------------------------------------------------
          vii. OCE's Report and Findings improperly reveal the 
        names of cooperative witnesses and personal information 
        from individuals referenced in the Report and Findings, 
        including identities, email addresses, and phone 
        numbers.\237\
---------------------------------------------------------------------------
    \237\Id.
---------------------------------------------------------------------------
    c. Factual and legal conclusions with which Representative 
Graves took issue:
          i. Representative Graves reasoned that because the 
        Small Business Committee has no financial oversight 
        authority, Representative Graves could have no 
        financial interest in Mr. Hurst's testimony before the 
        Small Business Committee.\238\
---------------------------------------------------------------------------
    \238\COS 00132.
---------------------------------------------------------------------------
          ii. Representative Graves argued that OCE's theory 
        regarding disclosure of financial interests ``would 
        create an absurdity because it would require all 
        Members of the [Small Business Committee] to cross-
        check their investments and their spouse's investments 
        with each potential witnesses' investments every time a 
        witness is invited by the [committee] to 
        testify.''\239\
---------------------------------------------------------------------------
    \239\COS 00135.
---------------------------------------------------------------------------
          iii. Representative Graves asserted that his then-
        Deputy Chief of Staff, his Chief of Staff, and 
        Representative Graves all agree that Representative 
        Graves did not choose Mr. Hurst to be a witness and was 
        rarely involved in the process of selecting 
        witnesses.\240\
---------------------------------------------------------------------------
    \240\COS 00135.
---------------------------------------------------------------------------
          iv. Representative Graves stated that he and Mr. 
        Hurst dispute OCE's inference that Representative 
        Graves was aware of Mr. Hurst's invesments.\241\
---------------------------------------------------------------------------
    \241\COS 00136; COS 00137.
---------------------------------------------------------------------------
          v. Representative Graves argued that Mr. Hurst's 
        background and history of congressional testimony 
        refute OCE's inference that Mr. Hurst was not qualified 
        to testify at the hearing.\242\
---------------------------------------------------------------------------
    \242\COS 00138; COS 00139
---------------------------------------------------------------------------

   F. Findings and Conclusions Regarding Deficiencies in OCE's Review

    The Standards Committee reviews any findings transmitted by 
OCE without prejudice or presumptions as to the merits of the 
allegations.\243\ As such, the Standards Committee's findings 
and conclusions with regard to Representative Graves were 
informed by, but made independent of, OCE's Report and 
Findings. However, after reviewing OCE's Report and Findings 
regarding the conduct of Representative Graves and conducting 
its own independent investigation, the Standards Committee was 
deeply disappointed to discover that OCE's review was 
fundamentally flawed because it routinely failed to adhere to 
the requirements of OCE's authorizing resolution, some of which 
were fatal to OCE's ability to continue its review.
---------------------------------------------------------------------------
    \243\Standards Committee Rule 17A(a). The Standards Committee Rules 
can be found at Appendix C.
---------------------------------------------------------------------------
    First, OCE failed to meet certain deadlines mandated by 
OCE's authorizing resolution and OCE's rules. OCE's 
jurisdiction to review a matter stems solely from OCE's 
authorizing resolution.\244\ Failure by OCE to abide by the 
strict timeframes established by its authorizing resolution 
effectively strips OCE of its jurisdiction over a matter.\245\ 
For example, in order for OCE to commence a second-phase 
review, three members of the Board must vote to commence a 
second-phase review before the end of the preliminary review. 
``If no such vote to commence a second-phase review has 
succeeded by the end of the applicable time period, the matter 
is terminated.''\246\
---------------------------------------------------------------------------
    \244\See generally, Watkins, 354 U.S. at 201.
    \245\See Capuano Report at 11, 14.
    \246\H. Res. 895, (c)(1)(C). This practice is consistent with other 
legal frameworks, in which investigative bodies are bound to strict 
deadlines to protect the fundamental due process rights of the subject 
of the investigation.
---------------------------------------------------------------------------
    OCE's preliminary review began at the request of two 
members of OCE's Board on March 26, 2009,\247\ and was 
completed within 30 days on April 25, 2009.\248\ On April 24, 
2009, at least three members of the OCE Board voted to initiate 
a second-phase review in this matter.\249\ By rule, OCE's 
second-phase review commenced when the preliminary review 
period expired.\250\ OCE's second-phase review ends in 45 
days,\251\ which in this case was June 9, 2009, and OCE could 
only have extended that period once by 14 days.\252\ 
Unfortunately, OCE voted to extend its review of the matter on 
June 12, 2009.\253\ This vote occurred three days after the 
second-phase review terminated, and OCE's authorizing 
resolution requires that a vote to extend must occur before the 
termination of the second-phase review.\254\ Thus, by law, 
OCE's second-phase review ended on June 9, 2009, because OCE 
did not timely vote to extend the review.\255\
---------------------------------------------------------------------------
    \247\OCE Review No. 09-7000, Findings of Fact and Citations of Law 
(OCE Findings), para.9.
    \248\H. Res. 895, section 1(c)(1)(B); OCE Rule 7(D).
    \249\OCE Findings, para.10.
    \250\H. Res. 895, section 1(c)(1)(C); OCE Rule 8(C). As noted 
previously, this interpretation of when OCE's second-phase review 
commences was provided to both the Standards Committee's staff and 
OCE's staff by the House Parliamentarian's Office, who stated that, if 
OCE's Board votes to initiate a second-phase review, that second-phase 
review begins immediately following the end of OCE's 30-day preliminary 
review period. Thus, the first day of OCE's second-phase review was 
April 26, 2009. The Standards Committee notes that OCE stated in a 
letter that its second-phase review would not ``commence'' until May 2, 
2009. Letter from David E. Skaggs and Porter J. Goss to Zoe Lofgren and 
Jo Bonner, April 27, 2009. OCE unfortunately did not provide any 
explanation for how it could delay commencing the second-phase review 
for five days. OCE has explained to the Standards Committee that its 
policy is to commence second-phase reviews on the day after the 
preliminary phase review ends.
    \251\OCE Rule 8(C) and H. Res. 895, section 1, clause (c)(2)(A)(i).
    \252\OCE Rule 8(C) and H. Res. 895, section 1, clause 
(c)(2)(A)(ii).
    \253\OCE Findings, para.10.
    \254\H. Res. 895, section 1, clause (c)(2)(A)(ii).
    \255\OCE Rule 8(C) and H. Res. 895, section 1, clause (c)(2)(A)(i).
---------------------------------------------------------------------------
    In its Findings, OCE claimed that the second-phase review 
terminated on June 30, 2009.\256\ Unfortunately, this was an 
incorrect calculation of the applicable time period regardless 
of which date OCE used. If the correct date of June 9, 2009, 
was used, OCE's 14-day extension would have ended on June 23, 
2009. Even calculating from June 12, 2009, the date on which 
OCE voted to extend, the 14 days would have ended on June 26, 
2009.
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    \256\OCE Findings, para.11.
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    Because the Board did not vote on or before June 9, 2009, 
OCE's review involving Representative Graves legally terminated 
on June 9, 2009.
    Since the matter terminated by rule, OCE staff should not 
have conducted further interviews or investigation. However, 
OCE conducted all of its interviews after June 9, 2009.\257\
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    \257\The dates of these interviews are documented in OCE's 
memoranda of interview. See Memorandum of Interview of Rep. Graves by 
OCE staff, June 15, 2009; Memorandum of Interview of Brooks Hurst by 
OCE staff, July 13, 2009; Memorandum of Interview of Thomas Brown by 
OCE staff, June 16, 2009; Memorandum of Interview of Paul Sass by OCE 
staff, June 16, 2009; and Memorandum of Interview of Jason Klindt by 
OCE staff, June 16, 2009.
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    Further, even assuming arguendo that the second-phase 
review concluded on June 30, 2009, as OCE claims, OCE continued 
to gather evidence in violation of its authorizing resolution. 
OCE staff interviewed a main and key witness in this matter on 
July 13, 2009,\258\ 13 days after OCE claimed the second-phase 
review concluded, and 34 days after the matter terminated by 
rule. Unfortunately, OCE appears to have lacked legal authority 
to conduct this interview.\259\
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    \258\The date of this interview is documented in OCE's memorandum 
of interview, and was independently confirmed by the Standards 
Committee. Memorandum of Interview of Brooks Hurst by OCE staff, July 
13, 2009.
    \259\See OCE Rule 8(C) and H. Res. 895, section 1, clause 
(c)(2)(A)(i); OCE Findings, para.11; Memorandum of Interview of Brooks 
Hurst by OCE staff, July 13, 2009; see generally Rumely, 345 U.S. 41; 
see also Capuano Report stated that ``Members of the Task Force believe 
that the timeline requirements instituted by the new process are 
critical: matters will spend at most three months under consideration 
by the board of the OCE before being referred to the Standards 
Committee for resolution.'' Capuano Report at 14.
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    Second, OCE's findings erroneously revealed the names and 
other identifying information of several cooperating witnesses 
in contravention of OCE's authorizing resolution.\260\ As the 
Capuano Report states, ``[c]ooperative witnesses, who will not 
be named by the board within the Findings in order to preserve 
confidentiality, should be listed within the supporting 
documents for the Standards Committee's information. These 
materials shall not be published unless the Standards Committee 
deems it necessary and appropriate.''\261\ Recognizing 
important confidentiality concerns, OCE's authorizing 
resolution contemplated that OCE would issue limited public 
``findings'' and that the bulk of information pertaining to a 
subject under investigation would be contained in non-public 
``supporting documentation'' unless its disclosure was directly 
relevant and necessary for inclusion in the ``findings.''\262\ 
Unfortunately, throughout OCE's ``findings,'' the names and 
other identifying information--such as emails, addresses, 
telephone numbers, and titles--of cooperating witnesses are 
disclosed openly without any attempt to redact the names or 
other identifying information.\263\ Because OCE made these 
materials part of its Findings, they are potentially subject to 
mandatory public disclosure.\264\
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    \260\H. Res. 895, section 1, clause (c)(1)(A). The Standards 
Committee notes that OCE gave the Standards Committee a revised version 
of its Findings on October 28, 2009, at 5:00 p.m. In this revised 
version, OCE redacted the last four digits of business direct-dial 
telephone numbers, the user-names of non-House email addresses, and all 
digits of private telephone numbers. The redactions, while helpful, do 
not resolve one of the fundamental problems with OCE's Findings--that 
it names cooperating witnesses in direct violation of its authorizing 
resolution and its rules.
    \261\See Capuano Report at 16.
    \262\See H. Res. 895, section 1, clause (c)(2)(C)(i)(II)(dd) and 
(c)(2)(C)(i)(III).
    \263\Not only did OCE deem unredacted documents, which identify 
cooperating witnesses, to be part of its Findings, OCE also 
incorporated and pasted into various sections of the narratives summary 
of its Findings images of emails and other documents provided by 
cooperating witnesses. Unfortunately, these images contain the 
identities of witnesses that voluntarily provided documents or 
testimony to OCE. The Standards Committee was particularly concerned 
that OCE's disclosure of the names of cooperating witnesses does not 
preserve the confidentiality of those witnesses.
    \264\Given the interplay between the various publication 
requirements of OCE's report and findings, and the clear directive to 
protect the privacy of cooperating witnesses, the Standards Committee 
is particularly concerned with the inclusion of identifying 
information--such as email addresses, direct-dial extensions, and 
personal cellular telephones--in OCE's Report and Findings. However, 
given these publication requirements, the Standards Committee is also 
more generally concerned with the presence of significant quantities of 
extraneous and irrelevant information included as part of OCE's Report 
and Findings in this case.
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    Third, OCE referred the matter to the Standards Committee 
for further review without finding a ``substantial reason to 
believe'' that there was a substantive violation of any 
provision of the Code of Official Conduct or any law, rule, 
regulation, or other standard of conduct applicable to 
Representative Graves' conduct in the performance of his duties 
or the discharge of his responsibilities. OCE's authorizing 
resolution limits OCE's review authority to ``any alleged 
violation by a Member . . . of any law, rule, regulation, or 
other standard of conduct applicable to the conduct of such 
Member . . . in the performance of his duties or the discharge 
of his responsibilities[.]''\265\ In accord with this 
resolution, OCE's rules state that OCE's jurisdiction is 
limited to reviewing whether a Member has violated a ``law, 
rule or regulation, or other standard of conduct in effect at 
the time the conduct occurred . . .''\266\ OCE's rules further 
state that:
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    \265\H. Res. 895, section 1, clause (c)(2)(C)(i)(II)(dd).
    \266\OCE Rule 1(3).

          The Board shall refer a matter to the Standards 
        Committee for further review if it determines there is 
        a substantial reason to believe the allegations based 
        on all the information then known to the Board. 
        However, in the event the Office is unable to reach 
        that determination, but the Board does determine there 
        is probable cause to believe the allegations, the Board 
        may refer the matter to the Standards Committee for 
        further review.\267\
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    \267\OCE Rule 9(A) (emphasis in original).

OCE found a substantial reason to believe that Representative 
Graves' conduct was inconsistent with the advice in the 
Standards Committee's House Ethics Manual that Members should 
avoid the ``appearance'' of a conflict of interest, but did not 
find that Representative Graves violated House Rule 3 
(pertaining to voting) or House Rule 23, clause 2 (i.e., 
failure to abide by the spirit of the rules).\268\ There is no 
relevant rule or standard of conduct that absolutely prohibits 
the ``appearance'' of a conflict of interest or that compels 
disclosure of every potential conflict.\269\ It is with great 
regret that the Standards Committee determines that it can only 
conclude that OCE violated both its authorizing resolution and 
its own rules when it forwarded this matter to the Standards 
Committee for further consideration without finding a 
``substantial reason to believe'' that there was a substantive 
violation of any relevant rule or standard of conduct.\270\
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    \268\OCE Findings, para.para.80-82.
    \269\In light of this, the Standards Committee was surprised to 
note the resources expended to conduct this investigation. For example, 
OCE sent two attorneys to Kansas City, who stayed overnight, to 
interview witnesses. See, e.g., Memorandum of Interview of Rep. Graves 
by OCE staff, June 15, 2009. The Standards Committee also conducted its 
own independent investigation. The Standards Committee notes that 
Representative Graves hired counsel to represent him during both OCE's 
review and the Standards Committee's investigation.
    \270\The Standards Committee is particularly concerned with 
improper referrals of this nature because of the publication 
requirements of referrals to the Standards Committee that recommend 
further review. If OCE properly refers a report and findings 
recommending further review to the Standards Committee, within 45 days 
the Standards Committee may either vote to empanel an investigative 
subcommittee or vote to withhold the report and findings for an 
additional 45 days. House Rule XI, clause 3(b)(8)(A); Standards 
Committee Rule 17A(c)(1). If the Standards Committee does not take 
either of those actions within 45 days, the Standards Committee must 
make OCE's properly referred report and findings public. House Rule XI, 
clause 3(b)(8)(A); Standards Committee Rule 17A(c)(1). If the Standards 
Committee votes to withhold the report and fmdings for an additional 45 
days and does not empanel an investigative subcommittee within the 
additional 45-day time period, the Standards Committee must then make 
OCE's properly referred report and findings public. House Rule XI, 
clause 3(b)(8)(A); Standards Committee Rule 17A(c)(1). In contrast, if 
OCE properly refers a report and findings recommending dismissal, and 
the Standards Committee then dismisses that referral, OCE's report and 
findings need not be published. House Rule XI, clause 3(b)(8)(B)(i); 
Standards Committee Rule 17A(e).
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    Fourth, OCE's Findings improperly make conclusions 
regarding the truth of statements made by cooperating 
witnesses, including Representative Graves. OCE's authorizing 
resolution states that OCE's findings shall not include ``any 
conclusions regarding the validity of the allegations upon 
which it is based'' or ``guilt or innocence of the individual 
who is the subject of the review.''\271\ Regrettably, in direct 
violation of this provision, OCE's Findings conclude that 
Representative Graves demonstrated a ``lack of candor'' in his 
responses to OCE.\272\ OCE then compounds this error by 
extrapolating that alleged ``lack of candor'' into a tacit 
admission of guilt on the part of Representative Graves.\273\ 
Pursuant to OCE's authorizing resolution, OCE's Board has the 
authority to make findings, not OCE's staff.\274\ However, no 
member of OCE's Board was present at the interview of 
Representative Graves\275\ and accordingly no Board member was 
in a position to evaluate his credibility.\276\ Thus, even if 
this credibility determination were considered a ``finding of 
fact'' rather than a comment on culpability, there is no 
authority for such a determination to be delegated to or made 
by OCE's staff.\277\
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    \271\H. Res. 895, section 1, clause (c)(2)(C)(i)(II)(dd).
    \272\OCE Findings, para.76. OCE's findings also improperly make 
conclusions regarding the validity of other allegations that are 
directly contrary to statements made by cooperating witnesses. See 
e.g., OCE Findings para.75 (concluding that ``Representative Graves had 
knowledge of [Mr. Hurst]'s investment in Golden Triangle and had reason 
to believe that [Mr. Hurst] was also invested in Biofuels'') and OCE 
Findings, Memorandum of Interview of Rep. Graves by OCE staff, June 15, 
2009, para.39 (noting that Representative Graves stated that 
``Investments are not something that he talks about with Brooks Hurst. 
He could not say what Brooks Hurst was invested in; he goes in and out 
of investments so he wouldn't know what he was invested in.'').
    \273\Id.
    \274\H. Res. 895, section 1, clause (c)(2)(C)(i)(II)(aa).
    \275\See Memorandum of Interview of Rep. Graves by OCE staff, June 
15, 2009.
    \276\The Standards Committee notes that OCE's witness interviews 
are neither transcribed nor video-taped. Instead, the only record of 
OCE's witness interviews is found in memoranda of interviews reflecting 
OCE's staff's impressions of the interview.
    \277\See Morgan v. US., 298 U.S. 468, 481 (1936) (``For the weight 
ascribed by the law to the findings . . . rests upon the assumption 
that the officer who makes the findings has addressed himself to the 
evidence, and upon that evidence has conscientiously reached the 
conclusions which he deems it to justify. That duty cannot be performed 
by one who has not considered evidence or argument. It is not an 
impersonal obligation. It is a duty akin to that of a judge. The one 
who decides must hear.''); U.S. v. Raddatz, 447 U.S. 667, 697 (1980) 
(Justice Marshall, dissenting) (``In this respect, the requirement that 
a finder of facts must hear the testimony offered by those whose 
liberty is at stake derives from deep-seated notions of fairness and 
human dignity.''); United States v. Oregon State Medical Society, 343 
U.S. 326, 339 (1952) (```Face to face with living witnesses, the 
original trier of the facts holds a position of advantage from which 
appellate judges are excluded. In doubtful cases, the exercise of his 
power of observation often proves the most accurate method of 
ascertaining the truth.'''); U.S. v. Diapulse Corporation of America, 
457 F.2d 25, 30 (2nd Cir. 1972) (``It is [the trial court's] duty to 
appraise the testimony and demeanor of the witnesses.''); In re Pearson 
Bros. Co., 787 F.2d 1157, 1162 (7th Cir. 1986) (``The question of 
credibility of witnesses is peculiarly for the trier of fact and an 
appellate court will not redetermine the credibility of witnesses where 
the trial court had the opportunity to observe their demeanor and form 
a conclusion.'').
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    Fifth, while the Committee does not intend to suggest that 
OCE acted maliciously or in bad faith, it is a fact that OCE 
ignored and failed to disclose relevant information 
Representative Graves provided to it. Along with its report and 
findings, OCE is ``authorized and directed to'' transmit ``any 
supporting documentation'' to the Standards Committee.\278\ 
During the course of OCE's review, Representative Graves 
provided a memorandum to OCE.\279\ The memorandum was from 
Barry Pineles, Chief Counsel to the Republican staff of the 
Small Business Committee,\280\ and was directly relevant to 
several central issues in this matter. For example, the 
memorandum provided OCE with information about the jurisdiction 
of the Small Business Committee, the typical procedures for 
announcing hearing topics for the Small Business Committee, the 
typical procedures for identifying witnesses for Small Business 
Committee hearings, and the witness disclosure requirements for 
witnesses at Small Business Committee hearings.\281\ The 
Standards Committee is generally concerned that OCE's Report 
and Findings do not mention this memorandum or address the 
contents of the memorandum. However, the Standards Committee is 
particularly disappointed that OCE did not forward the 
memorandum to the Standards Committee. As previously noted, OCE 
did not provide the Standards Committee with any ``supporting 
documentation'' in this matter. Unfortunately, such selective 
presentation of evidence to the Standards Committee raises 
significant concerns with the transparency of OCE's process.
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    \278\H. Res. 895, section 1(c)(2)(C)(i)(III).
    \279\COS 00133.
    \280\COS 00151-COS 00156.
    \281\Id.
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    Finally, after reviewing OCE's Report and Findings, the 
Standards Committee discovered materials within OCE's Report 
and Findings that were potentially favorable or exculpatory to 
Representative Graves. For example:
          a. Mr. Hurst told OCE in both a letter and during his 
        interview with OCE that he does not have any business 
        relationship with Representative Graves or Mrs. 
        Graves.\282\ This statement is inconsistent with OCE's 
        allegation that an appearance of conflict of interest 
        was created because ``Representative Graves could 
        expect [Mr. Hurst] to testify at the hearing in a 
        manner consistent with Witness A's and his own 
        financial interest.''\283\
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    \282\See COS 00113; Memorandum of Interview of Brooks Hurst by OCE 
staff, July 13, 2009, para.23.
    \283\OCE Findings, para.3; see also OCE Findings, para.75.
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          b. Documents OCE collected from Mr. Hurst show that 
        Mr. Hurst's interest in Biofuels, LLC, is less than \1/
        3\ of 1% and his interest in Golden Triangle Energy 
        Cooperative, Inc. is just 0.50%.\284\ The relatively 
        small amount of these holdings is inconsistent with 
        OCE's allegation that Mr. Hurst's and Representative 
        Graves' ``shared financial interest'' was such that 
        ``Representative Graves could expect [Mr. Hurst] to 
        testify at the hearing in a manner consistent with [Mr. 
        Hurst]'s and his own financial interest.''\285\
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    \284\See COS 00114; COS 00115.
    \285\OCE Findings, para.3; see also OCE Findings para.75.
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          c. Mr. Hurst stated in an interview to OCE that he 
        was the President of the Missouri Soybean Association 
        and had testified at Congressional hearings on prior 
        occasions. Mr. Hurst further stated that the first time 
        he testified at a Congressional hearing, he was invited 
        to testify by then-Representative Jim Talent.\286\ This 
        statement is inconsistent with OCE's implication that 
        Mr. Hurst was not selected because of his qualification 
        but only because of his ``shared financial interest'' 
        with Representative Graves.\287\
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    \286\See Memorandum of Interview of Brooks Hurst by OCE staff, July 
13, 2009, para.9.
    \287\See OCE Findings, para.para.3, 40, 41, 75.
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    The Standards Committee was disappointed when 
Representative Graves' counsel informed the Standards Committee 
that Representative Graves was not provided a copy of OCE's 
Findings nor any other materials, including the potentially 
favorable or exculpatory materials identified by the Standards 
Committee.\288\ The Standards Committee's view was that, in the 
interests of justice, these potentially favorable or 
exculpatory materials should have been provided to 
Representative Graves,\289\ and that Standards Committee Rule 
25\290\ required the Standards Committee to disclose these 
materials to Representative Graves. For this reason the 
Standards Committee provided Representative Graves with a copy 
of OCE's Report and Findings and directed Representative Graves 
to the existence of potentially favorable information in OCE's 
Findings.\291\
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    \288\Interview of Rep. Graves' Counsel by Standards Committee 
staff, September 17, 2009.
    \289\OCE Rule 4(F).
    \290\Standards Committee Rule 25.
    \291\Letter from Blake Chisam, Chief Counsel and Staff Director, to 
Rep. Graves, September 16, 2009.
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VII. STATEMENT UNDER RULE 13, CLAUSE 3(c) OF THE RULES OF THE HOUSE OF 
                            REPRESENTATIVES

    The Standards Committee made no special oversight findings 
in this report. No budget statement is submitted. No funding is 
authorized by any measure in this report.


