May 29, 2019

Whitehouse Remarks on the Federalist Society and Leonard Leo

Leonard Leo’s dark Federalist Society is installing judges that are poised to systematically and relentlessly dismantle government agencies that keep us safe and secure.

On Tuesday, the Washington Post  published an important investigation.  They looked into a very narrow, very wealthy group of special interests seeking to control our federal judiciary.  It was a revealing story, one that matters a great deal to the Senate and the people we serve.  I come to the floor today to discuss that tightening special-interest grip on our courts.

The central operative is Leonard Leo of the Federalist Society, the organization at the center of this effort.

As I described here on the Senate floor several weeks ago, there are three incarnations of the Federalist Society.  The first is a debating society for conservatives at law schools; they convene panels, for like-minded aspiring lawyers to talk about conservative ideas and judicial doctrine.  That’s all fine.

The second is a flashy Washington think tank.  They attract big-name lawyers, scholars, politicians, and even Supreme Court justices to their events.  They publish and podcast.  They hold galas.  I don’t agree with the work they do, but I don’t question their right to do it.

The third Federalist Society is what was on display in the Post  article.  It is something much, much darker, both in its funding and its function.  It is a vehicle for powerful interests seeking to “reorder” the judiciary, under their control, so as to benefit their corporate, right-wing purposes.  It seeks to accomplish by judicial power grab what the Republican Party has been unable to accomplish through the democratic process. 

This third, dark Federalist Society understands the fundamental power through the federal judiciary, to rig the system in favor of special interests. 

So what did the Post find about how our judges on the most important courts in the country are selected?  It found a network of front groups; shell entities with no employees; shared post-office boxes; common contractors and officers across nominally separate entities (even the same presidents); dark money funders; anonymous advertising; enormous pay packages for operatives; and judicial “lists” prepared secretly.  

Oh, and $250 million in dark money flowing through this apparatus. 

The story turns up familiar dark money funders, like the Mercers and the NRA.  But it also exposed groups that are harder to spot, which may not have garnered much attention before, but serve central functions in Leo’s court-fixing apparatus.

A few weeks ago, I delivered remarks on the Senate floor about the sweeping influence of Leonard Leo and the Federalist Society court-fixing scheme.  I touched on one Federalist Society product of their scheme in particular, the newly confirmed DC Court of Appeals judge Neomi Rao. 

I described some straightforward facts about Rao.  Her connection to the Federalist Society is no secret.  Sitting on the DC Circuit right now, her bio still appears on the Federalist Society website along with the list of 26 times she’s been featured at Federalist Society events. 

Before being nominated for one of the most influential courts in the country – what some call the second highest court in the land – she had never been a judge nor tried a case.  Instead, she had served as the Trump administration’s point person for helping big Republican donors tear down federal safety regulations.  She did this as the head of the White House’s Office of Information and Regulatory Affairs.  That’s not disputed, either. 

Before that, she founded something provocatively called the Center for the Study of the Administrative State at George Mason University’s Antonin Scalia Law School.  The Center is a cog in Leonard Leo’s machine. 

Let’s revisit Rao’s testimony before the Senate Judiciary Committee about the funding of her Center for the Study of the Administrative State.  She testified to me that neither the Koch Foundation nor any anonymous donors had funded her Center.  A trove of documents, obtained by me, the New York Times, and others, showed that wasn’t true.  A Virginia open records request revealed that an anonymous donor – funneling its dark-money donation through Leonard Leo – and the Charles Koch Foundation in fact donated $30 million intended to flow to her organization.

My remarks drew quite a reaction. The Center’s current director took to Medium to post a 2,500-word rebuttal.  He claimed I was all wrong about the Center’s funding – that none of its money came from those anonymous and Koch donations. 

The National Review  jumped into the fray and noted the Medium post on its website.  The nub of their criticism was that, although I was right, the Scalia Law School had indeed received millions in anonymous and Koch-brothers money, that money had gone to fund scholarships, not to the anti-regulatory Center for the Administrative State.

Let’s start by assuming that’s true.  I will tell you, if I gave $30 million to my alma mater “for scholarships,” I’d expect a thank you.  I expect they’d see my gift as a benefit to the school.  I’d even expect a nice press release – so I don’t buy the “just scholarships” dodge.

But let’s look a little more.  In 2016, George Mason University received a $10 million donation from the Charles Koch Foundation and a $20 million donation from an anonymous donor.  Both gifts came with grant agreements.  These grant agreements were among the Virginia open records request documents. 

The agreements do stipulate that the money was intended to fund “scholarships,” but also specify that gifts were conditioned on the school’s providing “funding . . . and support for,” – you guessed it – Neomi Rao’s “Center of the Study of the Administrative State.”

That’s not all we found.  Private communications revealed with the grant agreements show that the Koch Foundation and their handpicked law school administrators viewed all this money as fungible.  The Law School did a press release.  It’s announcement of the funding stated: “The scholarship money will also benefit the institution because it frees up resources that can be allocated for other priorities, including additional faculty hires and support for academic programs.” 

In a “Progress Report” to the Koch Foundation, under the heading “most pressing needs,” Dean Henry Butler wrote to the Koch Foundation that “Cash is King (scholarships are cash).” 

In that same memo to the Koch Foundation – a bizarre document to exist in the first place – Dean Butler also made clear that Rao’s center had indeed received hundreds of thousands in funding from an anonymous donor, just as I charged, and further, that it was being funded with $400,000 from “naming-gifts scholarship revenue”—the Koch Brothers “scholarships” money that was earmarked for Neomi Rao’s Center.  It was being re-routed to fund Leonard Leo and Neomi Rao’s project to gut public protections in this country.  The dark plot thickened.

Here is the most interesting part of all.  The open records documents also show that the law school dean, Henry Butler, regularly reported to Leonard Leo on developments at the Center, including faculty hiring and other Federalist Society priorities. 

The emails are cozy.  The dean is deferential.  There’s even a calendar entry for lunch at a Washington, D.C. restaurant for Neomi Rao, Henry Butler, and Leonard Leo.  Cozier still is that another condition of the Koch Foundation’s massive gift was that Henry Butler be protected as dean, because they viewed him – specifically him – as “critical to advancing the school’s mission.”

That mission?  Doing the Koch Foundation and Leonard Leo’s bidding to cripple public interest protections in this country. 

Neomi Rao’s defenders are also quick to push back on this point, arguing that my criticism of her center’s work was stifling “academic inquiry,” and pointing to the Center’s “research roundtables” and “public policy conferences” as evidence of its fair and independent academic bona fides.  

Sorry, but tough to buy when in one private fundraising email, Dean Butler was revealed to have asked one wealthy donor for a $1.5 million gift “to entice Neomi [Rao] to return home to Scalia Law after she dismantles the administrative state” in the Trump administration.  Tell me:  Who is the real threat to academic inquiry here?  And who is a present threat to judicial independence at the D.C. Circuit Court of Appeals?

Fancy lunches and weird, cozy relationships between public law school deans and DC powerbrokers can seem in the weeds, but let’s not lose sight of the bigger picture.  This stuff matters because Americans are now seeing their courts fill with judges – like Neomi Rao – who are expected and chosen to reliably rule for big corporate and Republican partisan special interests.

I recently looked at the numbers for the Federalist Society-dominated Supreme Court.  Under Chief Justice Roberts’s tenure, through the end of October Term 2017-2018, Republican appointees have delivered partisan 5-4 rulings that favor corporate or Republican partisan special interests not three or four times, not even a dozen or two dozen times, but 73 times.  Seventy-three victories delivered for big Republican interests, with no Democratic appointee joining the majority.

Here’s a case study: one of the most recent decisions of the Court, Lamps Plus v. Varela.  The plaintiff, Frank Varela, sued his employer, Lamps Plus, after a company data breach led to a fraudulent tax return being filed in his name.  An appellate court looked at the case and relied on a state contract principle to agree with Varela.  That is a traditionally conservative principle—deferring to state laws.  Well, along came the Supreme Court in this case, and ditched the conservative principle, to rule in favor of the company, 5-4. 

Here’s another case study:  Kisor v. Wilkie, currently before the Supreme Court.  On its face, it addresses an obscure administrative law doctrine about deference to federal agencies, but Kisor has been described as a “stalking horse for much larger game.” The larger purposes is to strip away deference to administrative agencies’ capacity to regulate independently in the public interest.

Imagine a world in which agencies get virtually no deference and Leonard Leo’s special-interest handpicked judges rule on Americans’ disputes with corporations.  If corporations are sick of protections for workers in the workplace, these judges will get rid of them—“dismantle the administrative state.”  If a corporation is sick of safeguards for our air and water, or dangers in toys our children play with, “dismantle the administrative state,” tear them down.  And if corporations are sick of a guardrail that keeps our financial system from dragging down millions of Americans’ financial security, these judges stand ready to “dismantle the administrative state,” protecting investors. 

Leonard Leo’s dark Federalist Society is installing judges that are poised to systematically and relentlessly dismantle government agencies that keep us safe and secure.

How to push back on this machine?  I propose sunlight.  We must have transparency in our campaign finance system, and we must have transparency into the special-interest conveyor belt filling our courts.

We must also have disclosure in our courts.  Right now, the dark money-funded front groups behind Leonard Leo are also behind amicus briefs directing judges how to rule.  This is a recipe for corruption.  The Court needs to require real transparency from so-called “friends of the Court.”  If the Court won’t, Congress must.  The American people deserve to know which powerful interests pay to sway federal judges with self-serving legal advice.

Thanks to the Washington Post’s reporting, we know a lot more about how this Federalist Society court-fixing operation works.  I am grateful for this work to illustrate how our courts are being captured by corporations and runaway partisanship.