Carrolton, GA – On Thursday the State Ethics Commission unjustly found “reasonable grounds” to hold the GRA, Inc. responsible for the alleged failure of the GRA-PAC officer Brant Frost V to file required campaign finance reports.
Attorney Catherine Bernard represented the GRA.
“There is no mention of the GRA-PAC in GRA Bylaws,” Bernard argued. “There was no actual authority for GRA, Inc. or any of its officers to direct the activities of GRA PAC – that would be the necessary finding in order for there to be reasonable grounds to proceed against the GRA, Inc. as an organization. There was no possession of authority to direct.”
“…and it’s not because we haven’t seen the evidence. We have seen the evidence. The evidence is in the form of bylaws, corporate registration, and actual financial donations that have been made… there are relationships, certainly, but there is not possession of authority to direct the activities that would allow this commission to find that somehow the GRA should have registered the GRA PAC as an independent committee, or filed these disclosure reports that are outlined in the notice of violations.”
Timothy Baywall, attorney for the ethics commission, said there is commission precedent where the commission held two entities responsible for the same offense, in a case related to the New Georgia Project, Inc. and the New Georgia Project Action, Inc. but he admitted “they both operated out of the same bank account” — which was never the case with the GRA and the GRA-PAC.
The hearing on Thursday was the first time that attorney Baywall presented arguments and evidence explaining why he believed the GRA, Inc. had such a close connection as to suggest some responsibility for the alleged failures of the PAC officer. Normally, in a court of law, both sides are required to present their arguments in advance of a hearing, so that both sides have the opportunity to prepare a response, but no such advance explanation was provided to the GRA prior to the hearing. The only presentation that was provided in advance was the allegations of the PAC officer’s failure to file correctly. This meant that Bernard had to form an answer very quickly.
While attorney Baywall was allowed to talk for over two hours, attorney Catherine Bernard was only able to speak for less than 50 minutes — often being interrupted with hostile questions from the panel and responses from Baywall — as the panel reminded her that they were eager to break for lunch.
The motion to find “reasonable grounds” against GRA, Inc. was made by Chairman James D. Kreyenbuhl, who was appointed to the commission by former Speaker David Ralston, whom the GRA and its endorsees frequently criticized for his unethical use of legislative leave, and heavy-handed control over other legislators. Baywall had made a point of highlighting emails where the GRA specifically called out Speaker Ralston.
Baywall did not present any evidence of the Georgia Republican Assembly, Inc. or its officers making any motions exercising authority or directing the GRA PAC, even after the GRA, Inc. had been extremely transparent and provided the commission with copious amounts of data, as they requested.
Baywall presented emails and public posts showing relationship between the two entities and then showed that both organizations at certain times shared some overlapping officers. Even though Baywall acknowledges that at least some of these overlapping officers were only “honorary,” he did not acknowledge that all of them may have been merely honorary, nor did he show evidence of any GRA PAC meeting where those supposedly overlapping officers were given the opportunity to vote to approve any actions by the PAC.
But even if overlapping officers suggests association, and association proves jurisdiction, then under that theory, the GAGOP should also be added to the complaint since six of the ten executive officers of the GRA during the last year also served on the GAGOP state committee. This theory is ridiculous since the bylaws of the Georgia Republican Party nowhere mention the GRA. The fact that a few officers (or even possibly a majority of the GRA officers) overlap with the GAGOP state committee does not give the GAGOP any “controlling interest” over the GRA nor does it give the GRA controlling interest over the GAGOP. They remain two separate entities, and, so it is with the GRA, Inc. and the GRA PAC.
“The entire time the Frosts ran the PAC,” said GRA President Nathaniel Darnell, “they insisted to us that since they gave the most money to the PAC, they had the controlling interest over the PAC’s decisions. We were not given any opportunity to override them.”
Nor does merely giving money to help a candidate get elected show that an entity is a PAC or an independent committee. There are many corporations throughout Georgia, such as Home Depot and Coca-Cola, which give political donations through one mechanism or another to candidates, politicians, and other political entities that promote them, and yet no one accuses them of operating a PAC.
At one point, Baywall even incorrectly claimed that GRA President Nathaniel Darnell had signed a check to the GRA PAC, even though the signature did not at all resemble Darnell’s and even though Baywall showed examples of Darnell’s signature that should have made it obvious. Moreover, the date of the check corresponded to the time that Nate Porter served as GRA Treasurer, and appears to have been his signature.
Baywall presented evidence of numerous campaign mailers that were funded by the GRA PAC, but many of these mailers had never before been seen by the three GRA, Inc. officers present at the meeting. They were seen for the first time that day, during the hearing.
“I had no clue the GRA PAC paid for mailers for Jeff Jones, or Emory Dunahoo, or some of the other candidates they showed in the meeting,” said GRA officer Abigail Darnell. “I certainly never was given an opportunity to vote on such expenditures in my four years serving on the GRA Executive Committee.”
“Why would the commission hold me responsible for accurate reporting of GRA-PAC expenditures when I didn’t even know about the existence of those expenditures until today?”
Furthermore, it was acknowledged during the hearing that the GRA PAC did not exclusively fund GRA endorsees, although they often overlapped. Many times it was only the West GA RA chapter, which was controlled by the Frost family, that endorsed a candidate, and the state GRA organization made no vote or decision on those endorsements. If the two entities were “one in the same,” as Baywall suggested, one would expect to see exclusivity. Also, many of the campaign mailers paid for by the GRA PAC that were submitted in the evidence did not include the GRA logo or any mention of the Georgia Republican Assembly on them.
“My responsibilities as Secretary of the GRA are defined in the Bylaws of GRA Inc” said Joanna Hildreth. “It is inaccurate and unjust for the commission to suggest that I had responsibility to provide oversight to another legal entity other than the Georgia Republican Assembly Inc.”
Baywall also presented a communication in which the GRA, Inc. referred to the GRA-PAC as a “partner organization.” But GRA leaders regularly call the Georgia Freedom Caucus, MA-GA Georgia, Georgia Right to Life, Truth in Education, the John Birch Society and other groups our “partner organizations” because they share some or all of our principles. This terminology denotes partnership in mission, not a financial partnership, and certainly not legal controlling interest of these organizations.
Furthermore, the GRA Inc. organized in 2013 and the GRA-PAC officially organized in 2017.
“Guilt by association is an intellectually lazy and legally empty argument,” said Banks Wise, the current GRA Treasurer. “I’m grateful for our legal representation in Catherine and Alex, and hope their excellent skills and committed advocacy for liberty & justice can stop being wasted on this bad faith inquisition.”
To legitimize their complaint against the GRA, the Ethics Commission needs to explain the following:
⁃ How they believe GRA Officers could have known what donations and expenditures were not being reportedly accurately by the GRA-PAC
⁃ How they believe GRA officers should have obtained financial data for the GRA PAC, when the GRA PAC maintained a separate bank account
⁃ What motion they believe GRA officers could have made to remedy the situation and compel action to ensure accurate filings for the GRA PAC, when the GRA PAC was a separate entity that is not mentioned in GRA Bylaws
“The individual who was legally responsible for the activities of the GRA PAC, as an organization, organized under the laws of Georgia – that person is responsible for filing disclosure reports and for correctly filing as an Independent Committee, a Political Action Committee, or perhaps as both,” said Bernard.
To hold someone responsible for actions, implies that they had the mechanism to perform that action.
“… That lack of a legal or factual mechanism we believe is what bars any further proceedings against the Georgia Republican Assembly,” said Bernard.
Another example of a lack of coordination by the GRA, Inc. and the PAC was seen in the responses by the two separate entities to the hearing itself. To the surprise of officers of the GRA, it was announced for the first time Thursday that attorneys for Frost and the GRA-PAC conceded Baywall’s reasonable grounds to investigate possible failures to comply with laws, but the GRA did not concede anything. Indeed, the GRA officers present at the hearing were entirely unaware of Frost’s decision until it was announced during the meeting.
The State Ethics Commission has 30 days to refer the case to the Office of State Administrative Hearings (OSAH) where it will be heard again.