FBI Capitulates on McCabe Texts After Adverse Court Ruling
 

 

For three years we have been in court for the text messages of former-FBI Deputy Director Andrew McCabe that we think could shed light on the FBI’s squelching of any serious investigation of her email and Clinton Foundation abuses.

Finally, the FBI will begin processing these messages for release. This comes after a federal court rejected the FBI’s request to dismiss our FOIA lawsuit.

We had sued on behalf of Jeffrey A. Danik, a retired FBI supervisory special agent, for McCabe’s emails and text messages (Jeffrey A. Danik v. U.S. Department of Justice (No. 1:17-cv-01792). Mr. Danik filed his first request for the records in 2016. 

After years of suggesting that text messages are not subject to FOIA, the FBI told the court in a recent filing that it has located 150 text messages and 5,696 emails but will not have a schedule to release the records until August 28, 2020. 

We filed the suit in 2017 in support of Danik’s October 25, 2016, and February 28, 2017, FOIA requests for records about McCabe’s “conflicts of interest” regarding his wife’s (Dr. Jill McCabe’s) political campaign and Hillary Clinton. Specifically, the two FOIA requests are for: 

Text messages and emails of McCabe containing “Dr. Jill McCabe,” “Jill,” “Common Good VA,” “Terry McAuliffe,” “Clinton,” “Virginia Democratic Party,” “Democrat,” “Conflict,” “Senate,” “Virginia Senate,” “Until I return,” “Paris,” “France,” “Campaign,” “Run,” “Political,” “Wife,” “Donation,” “OGC,” Email,” or “New York Times.” 

U.S. District Court Judge Tanya S. Chutkan denied the DOJ’s motion to dismiss the case, concluding that DOJ had not provided sufficient evidence to support its attempt to end the lawsuit without providing all emails and text messages responsive to the FOIA requests.  

The FBI has outrageously stonewalled for years the release of these McCabe text messages about Clinton. You can be sure the text messages are something the corrupted FBI doesn’t want the American people to see.

In November 2017, in a related case, we uncovered Justice Department records concerning ethics issues related to McCabe’s involvement with his wife’s political campaign. The documents include an email showing Mrs. McCabe was recruited for a Virginia state senate race in February 2015 by then-Virginia Lieutenant Governor Ralph Northam’s office. The news that former Secretary of State Clinton used a private email server broke five days later, on March 2, 2015. Five days after that, former Clinton Foundation board member and Democrat party fundraiser, Virginia Governor Terry McAuliffe, met with the McCabes. She announced her candidacy on March 12. Soon afterward, Clinton/McAuliffe-aligned political groups donated nearly $700,000 (40% of the campaign’s total funds) to McCabe’s wife for her campaign. 

Also in November 2017, we discovered Justice Department records showing that McCabe secretly had recused himself from the investigation into Clinton’s unsecure, non-government email server on November 1, 2016, one week prior to the presidential election. The Clinton email probe was codenamed “Midyear Exam.” While working as Assistant Director in Charge of the Washington Field Office, McCabe controlled resources supporting the investigation into Clinton’s email scandal. An October 2016 internal FBI memorandum labeled “Overview of Deputy Director McCabe’s Recusal Related To Dr. McCabe’s Campaign for Political Office,” details talking points about McCabe’s various potential conflicts of interest, including the FBI’s investigation of Clinton’s illicit server, which officially began in July 2015. 

McCabe was fired from the FBI in March 2018 for leaking to the media and lacking “candor.” Though now, we look forward to seeing his candid text messages!


Is Adam Schiff Above the Law?

A federal court decision, which we may appeal, just upheld the secrecy of controversial subpoenas for phone records issued by Adam Schiff, chairman of the U.S. House Permanent Select Committee on Intelligence, relating to the impeachment of President Trump.

Our lawsuit sought the controversial impeachment-related subpoenas for phone records, including those of Rudy Giuliani, President Trump’s lawyer. Schiff and the Committee are being represented by the Office of General Counsel for the House of Representatives.

The phone records led to the publication of the private phone records of Giuliani, Congressman Devin Nunes, journalist John Solomon, Trump attorney Jay Sekulow, attorney Victoria Toensing, and other American citizens.

In their 14-page motion Schiff and the Committee claim “sovereign immunity;” “Speech or Debate Clause” privilege; immunity from FOIA and transparency law; that the records are secret; and that Judicial Watch and public do not need to see them. Today’s court decision suggested that Schiff and the House have “absolute” immunity from inquiries about the subpoenas.

We filed our lawsuit under the public’s common-law right of public access to examine government records after we received no response to a December 6, 2019, records request (Judicial Watch v. v Adam Schiff and U.S. House Permanent Select Committee on Intelligence (No. 1:19-03790)):

“The records are of critical public importance,” our lawsuit argued, “as the subpoenas were issued without any lawful basis and violated the rights of numerous private citizens.”

Schiff secretly subpoenaed, without court authorization, the phone records of Rudy Giuliani and then published the phone records of innocent Americans, including President Trump’s lawyers, a member of Congress, and a journalist. And now a federal court has ruled that Schiff, or any member of Congress, can’t be held accountable for this unprecedented and potentially criminal abuse of power.

Every American should be concerned about a ruling that suggests Congress has unlimited power to take and publish their private phone records!


Bureaucrats Try to Explain Chinese Equipment Ban to Contractors

We have been at the forefront on reporting efforts by the Chinese government to extract vital national security secrets, and we’re not finished.

A new rule prohibits the use of Chinese equipment “to protect U.S. networks against cyber activities conducted through Chinese Government-supported telecommunications equipment and services.” An attempt by a government agency to explain this to government contractors is worth your review, as our Corruption Chronicles blog reveals.

The U.S. government has crafted an amusing new guide to help federal agencies and contractors comply with the ban on Chinese telecommunications and surveillance equipment. The rule was issued last year to combat national security and intellectual property threats against the United States and details were published in August 2019 in the Federal Register. Officials from the Department of Defense (DOD), General Services Administration (GSA) and the National Aeronautics and Space Administration (NASA) helped design the measure, which covers a portion of the 2019 National Defense Administration Act that restricts the use of federal funds to do business with Chinese telecommunications firms and forbids government contractors and recipients of government grants from working with Chinese companies or those that utilize their technology.

This month, the GSA, the huge syndicate that helps manage federal agencies, released a colorful two-page guide to assist them in navigating the new rule. With around 12,000 employees, the GSA provides centralized procurement for the federal government and manages billions of dollars in products, services and facilities. The bloated agency has an extensive history of mismanagement and waste, though it touts itself as an innovation engine that helps the government cut costs. In 2010 the GSA was embroiled in a big scandal for hosting a lavish Las Vegas event for employees featuring luxury accommodations for staff and their loved ones, fine cuisine, wild parties and expensive gifts. Dozens of agency workers were awarded cash bonuses for arranging the outlandish Sin City celebration and a senior GSA executive got criminally charged for submitting fraudulent reimbursement claims and making false statements in connection with the costly shindig. In 2013 Judicial Watch uncovered more GSA extravagance by obtaining several embarrassing videos showing senior GSA officials and staff participating in costumed playacting and parodies.

 

That background is relevant in introducing the GSA’s colorful—and seemingly pointless—pamphlet on the Chinese telecom ban, which includes advice for government contractors and other information associated with implementing the new measure. The flyer is titled “Section 889” after the portion of the 2019 Defense Authorization bill that covers the ban on equipment from Chinese firms. It specifically names Huawei, ZTE, Hytera, Hikvision, and Dahua and their subsidiaries as banned companies and mandates that contractors immediately report any covered equipment or services “if discovered during the course of contract performance.” Various agencies, including the DOD, NASA and the GSA have hosted meetings to help federal agencies and government contractors navigate the implementation of the Chinese telecom ban, which officially takes effect in August for businesses hired by the feds.

The GSA brochure encourages government contractors to read and understand the rules and “determine through reasonable inquiry” whether they use the “covered telecommunications equipment or services.” Contractors are also directed to educate their purchasing and materials management professionals to assure they are familiar with the compliance plan and alert the government if use of banned Chinese equipment is discovered during contract performance. Those that replace prohibited Chinese telecom equipment or services must “ensure” the new equipment is “compliant,” the GSA writes, stating the obvious: do not exchange banned Chinese materials with banned Chinese materials. Firms doing business with the government are also encouraged to develop a phase-out plan with the complete laydown of equipment and services banned under the new law.

A section that explains why the changes are important reveals that U.S. foreign adversaries are using increasingly sophisticated methods such as supply chain and cyber operations to gain access to critical infrastructure and steal sensitive information. Additionally, the GSA flyer says, the increasing reliance on foreign owned or controlled telecommunications equipment creates vulnerabilities in U.S. supply chains. “China is increasingly asserting itself by stealing U.S. technology and intellectual property to erode U.S. economic and military superiority,” the GSA pamphlet states. A section on waivers says every federal agency must designate a senior official for Supply Chain Risk Management and every waiver must include a compelling justification for additional time needed, full laydown of banned equipment and phase-out plan.

A Trump Victory on Hospital Costs          

With little notice in the adversarial media, President Trump has been moving to untangle our nightmare healthcare system, including actions to lower prescription costs. Micah Morrison, our chief investigative reporter, informs us of the success of another presidential effort in our Investigative Bulletin:

A little-noticed court ruling last month signals a major Trump Administration victory for healthcare transparency. The likely result? Lower hospital bills.

Anyone ever confronted with a hospital bill knows it can be a frightening and bewildering experience. In 2019, Trump moved to fix that, instructing the Department of Health and Human Services (HHS) to come up with a plan, and a clear-language format, that would inform patients “about actual prices.”

The executive order instructed HHS to propose a regulation requiring hospitals to “publicly post standard charge information, including charges and information based on negotiated rates and for common and shoppable items and services.” HHS complied, issuing a rule that defined hospital charges, set an easy-to-understand format, and established an enforcement schedule.

Hospital groups were not happy. Led by the powerful American Hospital Association, they challenged the ruling, arguing HHS did not have the authority to issue the rule. They threw in for good measure a violation of the First Amendment and arbitrary and capricious behavior under the Administrative Procedure Act.

U.S. District Judge Carl Nichols didn’t buy it.

 

In a victory for freedom of information, Judge Nichols, a 2019 Trump appointee, rejected the hospitals’ arguments. “The impenetrability of hospital bills is legendary,” he noted. The hospitals’ position is “essentially attacking transparency matters generally, which are intended to enable consumers to make informed decisions.”

Under the new rules, hospitals must publish the gross or “chargemaster” charge—that is, the often highly inflated fee used internally as an accounting tool and starting point in billing. The “discounted cash price”—charges to individuals who pay cash or who do not, or cannot, use insurance to cover the fee. The “payer-specific negotiated charge”—the charge the hospital has negotiated with a third party, such as your insurance provider. And the “de-identified minimum and maximum charges”—as Judge Nichols explains, these are “the highest and lowest charges the hospital has negotiated with all third-party payers for an item or service.”

The Nichols ruling shows us the power of transparency in a real-world setting. Price transparency helps consumers make decisions about where to put their money and where to maybe get a better deal. It puts downward pressure on costs. It hands power to patients.

Hospital groups say they will appeal. The regulations do “nothing to help patients understand their out-of-pocket costs,” said an attorney for the hospitals. “It also imposes a significant burden on hospitals at a time when resources are stretched thin and need to be devoted to patient care.”

Read the full Nichols ruling here.
 

Until next week,