Litigious ‘Progressive’ Attorney Launches Legal Action – Best Known for Tying BIAW in Knots, Forcing Rossi to do ‘Perp Walk’

Seattle attorney Knoll Lowney and one of his latest targets -- state Republican chairman Kirby Wilbur.

By Erik Smith

Staff writer/ Washington State Wire

OLYMPIA, Jan. 27.—The nastiest game of political tit-for-tat ever played before the state Public Disclosure Commission seemed to end Thursday in a complete rout for the Washington chapter of Americans for Prosperity, as the conservative organization was exonerated of charges of campaign skullduggery that had been leveled by the state Democratic Party and the Sierra Club.

            But it ain’t over yet. Knoll Lowney, the litigious ‘progressive’ Seattle attorney who has used lawsuits of varying and often dubious merit to hamstring the state’s conservative political interests, has started a process that likely will lead to a lawsuit of his own. On Tuesday he filed a ‘45-day notice’ with the state attorney general’s office, giving Republican Rob McKenna a deadline to sue Americans for Prosperity and a roster of favorite Democratic bogeymen, with conservative political financiers Charles and David Koch at the top of the list.

            If McKenna says no, Lowney gets to file his own lawsuit.

            And so one of the longest-running campaign complaints in state history seems to have some life left in it after all, despite an investigation by the state Public Disclosure Commission that found it to have no basis, and a second attempt by the staff that confirmed the first.

            “We’ve been exonerated twice by the PDC, and as far as I’m concerned, it’s over,” said Kirby Wilbur, the former director of the state Americans for Prosperity chapter and the current chairman of the state Republican Party. “I’m sure [Lowney’s action] has some harassment value, but that’s the way these things go.”

            Wilbur also is one of the targets of Lowney’s legal action.

            PDC Decision is Unanimous

            The state campaign-watchdog agency voted 4-0 Thursday to dismiss complaints that the organization had failed to file correct campaign-disclosure paperwork during the 2010 election season. In fact, its staff maintains AFP never had to file reports in the first place. And if it wasn’t for Lowney’s letter, the decision would have settled an argument that has raged since the election wrapped. Democrats used the complaint against AFP to argue that both sides played dirty.

            The commission’s ruling basically says only one side did.

            The partisan complaints against the conservative group were filed at the same time that an independent “progressive” campaign was being hauled up on rather more serious charges. Seattle consulting firm Moxie Media pulled off Washington’s biggest-ever campaign fakeout when it created a phony mailer-and-robocall effort to make a hapless tea partier look like a major Republican contender in an Everett Senate primary. Republicans were hoodwinked, and the effect was to knock out a moderate incumbent Democrat in favor of a progressive favorite. That part was legal, but what got Moxie Media in hot water was the fact that it didn’t file paperwork showing the “Republican” campaign was backed by the state Labor Council, the Federation of State Employees, and the state trial lawyers’ association.

            Last month Moxie Media settled a lawsuit with the state attorney general’s office for $290,000, one of the largest political fines in state political history.

            Democrats frequently compared AFP to Moxie Media and said they were two sides of the same coin. Sen. Tracy Eide, D-Kent, denounced AFP in a speech on the Senate floor. State Democratic Party chairman Dwight Pelz, who personally filed one of the complaints, took frequent jabs at AFP and its support from the Koch Brothers.

            But where AFP was concerned, there was a big difference. The Public Disclosure Commission couldn’t find anything wrong. Nor does there seem to have been any attempt to deceive anyone, at least in one commissioner’s view.

            “It sounds to me like they tried to comply with the laws we have in this state,” commissioner Jim Clements said just before the vote took place.

            Complaint Centered on Mailing Cards

            The case centered on cards AFP mailed to registered voters in 13 key legislative districts during the month before the 2010 election. To be sure, they hammered Democrats for their positions on tax and spending bills, and not a soul would accuse them of being neutral.

            Said one, “Call Sen. Eric Oemig and tell him you are tired of him ignoring the will of the people, raising taxes and irresponsibly spending our money!”

            Whether anyone actually called Oemig is unknown. But perhaps the message may have gotten through. He and three other incumbents were defeated in tight races.

            The legal question is whether the cards were the kind of mailing that triggers campaign-finance reporting requirements. The PDC’s staff and legal counsel offered an emphatic no, in an investigation report released last month and an even-more-emphatic legal brief last week. The key point is this: The cards never mentioned the election, and didn’t advocate the support or defeat of any candidate. Instead they followed the commonly-used pattern of “issue advertising,” so no reporting was required.

            The cards might have been considered “electioneering communications,” which also would have triggered reporting requirements. But none of the mailings reached the $5,000 threshhold that was required at the time. All told, AFP spent $32,000 on the campaign.

            Not a Lobbying Effort

            The legal brief, written by assistant attorney general Linda Dalton, offers the clearest statement yet that AFP didn’t have to file a thing. One question that frequently has been raised by opponents is whether AFP should have been considered a grass-roots lobbying organization, and whether it should have started filing campaign finance reports after it was formed in March 2010.

            Dalton’s brief doesn’t answer the question directly, because it was not raised in either of the complaints. But she says a strict test must be applied in such cases. Grass-roots groups must present a “‘call to action’ to move the public to influence legislation,” she wrote. She quoted from the law, which says requirements kick in only when organizations raise money for “a program addressed to the public, a substantial portion of which is intended, designed or calculated primarily to influence legislation.”

            The mailers could hardly be called that. So even though Americans for Prosperity filed a grass-roots lobbying report on Nov. 10, 2010 after Democratic critics started raising a stink, Dalton’s brief says the group didn’t have to.

            As for the group’s activities before the mailings, they consisted mainly of tea-party-type rallies against big government, and the closest AFP came to anything specifically before the Legislature was a demonstration in favor of McKenna’s decision to join a national lawsuit against health care reform. No legislation was involved.

            Now Enter Lowney

            Lowney’s entry into the affair turns everything on its side. Lowney has made a name for himself with a series of notorious lawsuits that appear aimed more to harass political opponents than to adjudicate. They include suits against the Building Industry Association of Washington, formerly a bulwark of conservative power in this state. In one case, he accused the association of “skimming” interest from its worker-compensation programs, representing five green-minded contractors who had at most $350 at stake. Lowney sought $98 million in damages. At one point BIAW officials said he asked the court to award $3 million to compensate him for the accounting work done for the case – while curiously maintaining that he was paying the cost of the litigation himself.

            In another notorious case involving BIAW, Lowney hauled Republican gubernatorial candidate Dino Rossi into court for a deposition, forcing him to do a “perp walk” for the TV cameras just before the 2008 election. The transcript shows he didn’t have much to ask. The allegation was that Rossi had illegally colluded with BIAW in the management of an independent campaign. Lowney revived the case just before Rossi’s bid for Senate in 2010 and tried to haul him back into court.

            Ultimately neither case went anywhere – the Rossi case was thrown out “with prejudice” after years of litigation, an unusual decision that prevented Lowney from raising the issue again. The “skimming” case ended when another judge ruled there had been minor accounting violations, but refused to award damages. Yet if the idea was to divert money, time and resources, and cast doubt on public reputations during an election, it may have done the trick. By Washington State Wire's count, the BIAW cases generated more than 100 newspaper articles and blog postings alone, most of it as voters were casting ballots by mail in the 2008 election. Washington State Wire was the only outlet to cover the ultimate dismissal of the final suit in 2010. 

            Lowney’s letter to McKenna’s office, at the very least, will force the Republican attorney general to take a stand either for or against Americans for Prosperity. The letter says Lowney is planning a lawsuit if McKenna fails to act – and if a suit is actually filed, the legal proceedings could hit high gear right about the time of the 2012 elections.

            In his letter, Lowney raises the identical issues that already were reviewed and dismissed by the attorney general’s office in the Public Disclosure Commission case. There’s only one new argument. Lowney says AFP’s spending for independent campaigns in other states ought to be considered proof that campaign reporting was required in the state of Washington. Nothing in state law, however, says that national spending has any bearing on in-state campaign reporting requirements.