Pursuing Campaign Reform--and Profits

After crusading for campaign finance reform for 25 years, Tony Miller knows how to follow the political money. Now he’s getting some of it back.

In recent months, Miller, the former acting secretary of state, has lodged more than a dozen lawsuits against large political donors to state campaigns, alleging that they have failed to follow California’s Political Reform Act.

That’s just the start. Miller is preparing to file no fewer than 74 additional--and potentially lucrative--suits in the coming weeks and months.

Among his current and future targets: Amway, among the nation’s largest political donors, and a woman facing federal charges in the national Democratic fund-raising scandal. There are major Wall Street firms, restaurants and hotel chains, a bank, an oil company, even rock ‘n’ roll star Bruce Springsteen, and attorney Johnnie L. Cochran Jr.

“We’re not talking about mom and pop donors. [The lawsuits’ targets] are giving at least $10,000, and some of them $100,000,” Miller said, on a day when he was preparing to make one of his regular visits to the Sacramento County courthouse to check on his lawsuits.

Within the small circle of lawyers who engage in the arcane practice of political law, Miller’s latest undertaking is giving him quite a name, not always kind.

“He’s finding technical violations and he’s profiting from them,” said attorney Tom Hiltachk, who represents many Republicans. “It’s a perversion of the Political Reform Act.”

“In our little industry,” said Sacramento lawyer Lance Olson, who represents Democratic targets of Miller’s claims, “we call it shooting fish in a barrel.”

Before the details about what he’s doing now, here’s what Miller has done in the past.

His campaign finance reform efforts go back to the middle 1970s, when he was on the Fair Political Practices Commission, which enforces the Watergate-era Political Reform Act. After that, he was top aide to longtime Secretary of State March Fong Eu, overseeing filings of campaign finance statements.

Miller also has experienced the campaign system firsthand, narrowly losing the 1994 race for secretary of state to Bill Jones, then losing this year’s Democratic primary for lieutenant governor in a landslide for Lt. Gov.-elect Cruz Bustamante.

In the 1998 race, Miller held true to his belief that there should be strict fund-raising caps, turning down any donation of more than $1,000. In his two statewide runs, more than 90% of his contributions have been for $1,000 or less.

Miller has tried to put his ideals into law, helping write Proposition 208, the 1996 ballot measure to restrict campaign contributions and spending that was approved with 61% of the vote but suspended by the courts (Miller is working on an appeal).

In short, there aren’t many people who know the details of political law better than Miller.

He knows, for example, that anyone who donates $10,000 or more to campaigns in a single year must file a document called a major donor statement with the secretary of state.

He knows too that many donors overlook the requirement and that the Fair Political Practices Commission rarely if ever levies fines for such violations. After all, the candidates and initiative campaigns themselves must disclose the donations as well.

But while the FPPC generally doesn’t bother with such matters, Miller does. A little-used provision of the 1974 Political Reform Act says that if the FPPC declines to take action, any Californian can sue donors and candidates to enforce the law.

Starting in August, Miller began picking through campaign finance statements, looking for violations. They are not hard to find. Miller and a few helpers simply look for large donations, then check to see if the donors have filed major donor statements. By October, Miller turned up 161 possible violations.

As the law requires, Miller gave his findings to the Fair Political Practices Commission. The commission cherry-picked the biggest violations, suing several donors for failing to comply. In those instances, Miller collects no money.

In at least 74 other cases, however, the commission decided against taking action, explaining in a Nov. 20 letter that it lacked the staff to handle the work and that the violations caused minimal “public harm.”

That left Miller free to sue.

The law permits him and other private plaintiffs to collect penalties equal to the amount of the donations, plus court costs and attorneys’ fees. Miller insists that he is not out to gouge donors who fail to make the proper filings.

He has settled cases involving failure to file major donor statements for as little as $1,250. Miller doesn’t even get the full $1,250. He must give a portion of it--$300--to the state.

“If I were practicing law to make money, I wouldn’t be doing this,” Miller said. “This is not financially rewarding, yet.”

There is the possibility of bigger returns.

Miller has sued Gov. Pete Wilson and the campaign committee established to push the anti-union Proposition 226, which failed in June despite the governor’s vocal support.

The suit accuses Wilson and some donors of using various campaign committees to hide the source of at least $250,000 in donations for Proposition 226. If the allegations prove true--Wilson denies wrongdoing--Miller stands to collect at least $250,000.

“Tony Miller is an ambulance chaser,” said Wilson spokesman Sean Walsh. “In the worst tradition of shyster lawyers, he is attempting to exploit a little-known provision that allows one to go prospecting.”

Many political law attorneys have been taken aback by Miller’s suits. Some have called on the FPPC and the Legislature to limit such suits. Others said Miller is picking on Republican donors, though Miller has targeted Democratic givers too.

“Donors are furious with the [recipients], that the [recipients] did not protect them from this exposure,” said attorney Chip Nielsen, who represents Republican donors, Wilson and the state GOP.

Nielsen said that campaign finance law is convoluted and duplicative, and that donors who only occasionally give to state campaigns have no easy way of knowing about the many reporting requirements. He worries that the threat of a lawsuit may scare some donors from giving.

“Rube Goldberg or the U.S. government would have to be the author of this scheme for us to believe it’s not fantasy,” Nielsen said.

But Miller has his defenders too.

“Tony Miller is performing a public service,” said James Hall, chairman of the FPPC, though he noted that Miller’s efforts are bogging down the enforcement division’s six attorneys and eight investigators.

“Someone should be enforcing it,” said former state Sen. Barry Keene, who is affiliated with the Center for California Studies at Cal State Sacramento. “If [Miller’s action] secures enforcement and if the laws are intended to be enforced, I don’t see anything wrong. If the laws are excessively burdensome, then they ought to be changed.”

Miller believes that the reporting requirements imposed on major donors are important, given California’s no-holds-barred campaign financing system, in which individuals and corporations can give as much as they want to candidates. Many large donors give to several candidates and causes. Major donor statements are the best source for the public to find all contributions from a big giver.

“Sunshine is the only political reform we have right now,” Miller said. “You can at least follow the money.”

Miller’s hope remains that Proposition 208 will be reinstated. A federal Court of Appeal decision could come at any time. The initiative would cap individual donations to candidates at $1,000. It would impose even stricter reporting requirements on donors and candidates.

Without Proposition 208 in place, California candidates and initiative promoters raised and spent more than $300 million this election year.

All that money means that Miller could be looking at a lucrative new year, particularly if many large donors have overlooked the Political Reform Act’s reporting requirements.

“A lot of people think no one will care,” Miller said. “Well, I do care.”