[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.
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\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.
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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.
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\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\
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\12\House Rule X, clause 1(p).
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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\
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\13\COS 00151-COS 00156.
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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\
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\14\House Rule X, clause 2(b).
\15\House Rule X, clause 3(l).
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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\
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\16\COS 00065.
\17\COS 00019.
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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\
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\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\
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\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.
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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\
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\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\
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\21\COS 00071.
\22\COS 00084.
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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\
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\23\Representative Graves represents the Sixth Congressional
District of Missouri.
\24\COS 00082.
\25\COS 00073.
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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\
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\26\Memorandum of Interview of Paul Sass by OCE staff, June 16,
2009, para.4.
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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\
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\27\Interview of Paul Sass by Standards Committee staff, September
16, 2009.
\28\Id.
\29\Id.
\30\Id.
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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\
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\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\
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\36\COS 00084.
\37\COS 00066.
\38\COS 00071.
\39\COS 00088.
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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\
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\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'').
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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\
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\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\
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\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.
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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\
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\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).
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``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:
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\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).
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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\
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\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\
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\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.
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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\
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\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.
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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).
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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.
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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.
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\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.
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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\
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\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\
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\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.
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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\
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\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.
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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\
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\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.
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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.
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\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.
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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:
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\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.
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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\
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\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\
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\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.
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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.
---------------------------------------------------------------------------
\256\OCE Findings, para.11.
---------------------------------------------------------------------------
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\
---------------------------------------------------------------------------
\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.
---------------------------------------------------------------------------
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\
---------------------------------------------------------------------------
\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.
---------------------------------------------------------------------------
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.