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Cooke v. Illinois State Board of Elections

Court of Appeals of Illinois, Fourth District

August 19, 2019

DAVID W. COOKE, Petitioner,
v.
THE ILLINOIS STATE BOARD OF ELECTIONS; WILLIAM J. CADIGAN, in His Official Capacity as Chairman; JOHN R. KEITH, in His Official Capacity as Vice Chairman; WILLIAM M. McGUFFAGE, in His Official Capacity as Member; ANDREW K. CARRUTHERS, in His Official Capacity as Member; CHARLES W. SCHOLZ, in His Official Capacity as Member; IAN K. LINNABARY, in His Official Capacity as Member; KATHERINE S. O'BRIEN, in Her Official Capacity as Member; CASANDRA B. WATSON, in Her Official Capacity as Member; and COMMITTEE FOR FRANK J. MAUTINO, Respondents.

          Petition for review of order of Illinois State Board of Elections, No. 16-CD-93.

          Jeffrey M. Schwab and James J. McQuaid, of Liberty Justice Center, of Chicago, for petitioner. Attorneys for Appellant

          J. William Roberts, Anthony J. Jacob, Adam R. Vaught, and Carson R. Griffis, of Hinshaw & Culbertson LLP, of Chicago, for respondent Committee for Frank J. Mautino. Kwame Raoul, Attorney General, of Chicago (Aaron T. Dozeman, Assistant Attorney General, of counsel), for other respondents. Attorneys for Appellee:

          JUSTICE KNECHT delivered the judgment of the court, with opinion. Presiding Justice Holder White and Justice Turner concurred in the judgment and opinion.

          OPINION

          KNECHT, JUSTICE

         ¶ 1 In February 2016, David W. Cooke, an Illinois resident, filed a complaint with the Illinois State Board of Elections (Board), alleging the Committee for Frank J. Mautino (Committee) committed various violations of article 9 of the Election Code (10 ILCS 5/9-1 to 9-45 (West 2014)) based on its reported expenditures to Happy's Super Service Station (Happy's) and Spring Valley City Bank (Bank) between 1999 and 2015. At the time of filing, the Committee was dissolved due to Frank J. Mautino becoming the Illinois Auditor General on January 1, 2016.

         ¶ 2 Following a March 2016 closed preliminary hearing, the Board found Cooke's complaint was filed on justifiable grounds and ordered the Committee to file amended reports to provide additional information concerning the expenditures to Happy's and the Bank. The Committee failed to file amended reports. At an April 2017 public hearing, the parties presented evidence and argument relating to both the Committee's failure to comply with the Board's order to file amended reports and the substantive claims raised in Cooke's complaint. The Board found the Committee willfully failed to comply with part of its order and imposed a $5000 fine. The Board also found violations of the Election Code based on the Committee "filing disclosure reports that were insufficient with regard to documentation, amount and accuracy of reported expenditures to [the Bank] and [Happy's]."

         ¶ 3 After the public hearing, Cooke filed a motion to reconsider, arguing the Board failed to address and issue rulings on his claims alleging the Committee violated section 9-8.10(a)(2) and (a)(9) of the Election Code (id. § 9-8.10(a)(2), (a)(9)) based on its use of committee funds. At a June 2017 hearing on the motion, a Board member moved to find Cooke had proven his section 9-8.10(a)(2) and (a)(9) claims and to impose "an additional fine of $5000 to run concurrently with the fine" previously imposed. The Board member's motion failed due to a deadlock four-to-four vote, and Cooke's motion to reconsider was denied. Cooke thereafter filed a petition with this court seeking direct review of the Board's decision.

         ¶ 4 In May 2018, we issued a decision remanding the matter for the Board to (1) amend, based on the concessions of the parties on appeal, its order to show the Committee violated sections 9-7 and 9-11 of the Election Code (id. §§ 9-7, 9-11) based on its accounting and reporting of committee expenditures and (2) address and issue rulings on the merits of Cooke's claims alleging the Committee violated section 9-8.10(a)(2) and (a)(9) of the Election Code (id. § 9-8.10(a)(2), (a)(9)) based on its use of committee funds. Cooke v. Illinois State Board of Elections, 2018 IL App (4th) 170470, ¶ 95, 104 N.E.3d 516.

         ¶ 5 Following a July 2018 special meeting on remand, the Board (1) issued a nunc pro tunc order finding the Committee violated sections 9-7 and 9-11 of the Election Code (10 ILCS 5/9-7, 9-11 (West 2014)) and (2) addressed and ruled on Cooke's section 9-8.10(a)(2) and (a)(9) claims. The Board, based on a deadlock, four-to-four vote, concluded it could not find the Committee violated either section 9-8.10(a)(2) or section 9-8.10(a)(9) of the Election Code (id. § 9-8.10(a)(2), (a)(9)).

         ¶ 6 Cooke again seeks direct review of the Board's decision. Cooke argues we should reverse the Board's decision to the extent it ruled against him on his section 9-8.10(a)(2) and (a)(9) claims and then remand for a determination of the appropriate fines. We affirm in part, reverse in part, and remand with directions.

         ¶ 7 I. BACKGROUND

         ¶ 8 A detailed background concerning the prior proceedings in this case can be found in our previous decision. See Cooke, 2018 IL App (4th) 170470, ¶¶ 3-78. For the purposes of this appeal, we will summarize the facts established at the public hearing relating to Cooke's section 9-8.10(a)(2) and (a)(9) claims as well as the proceedings and rulings that occurred following our remand.

         ¶ 9 A. Public Hearing

         ¶ 10 The evidence presented at the April 2017 public hearing included, among other things, transcripts from a deposition of the Committee's former treasurer, various reports detailing the Committee's expenditures and contributions, and a December 14, 2012, letter addressed to the Committee from a Board staff member. The following is gleaned from the evidence presented as it relates to Cooke's section 9-8.10(a)(2) and (a)(9) claims.

         ¶ 11 Between 1999 and 2015, the Committee reported $225, 109.19 in expenditures to Happy's for gasoline and vehicle repairs. During that time, the Committee did not own or lease any vehicles. The gas and repairs were expensed to a charge account at Happy's for the Committee. On a monthly basis, the Committee paid an invoice from Happy's for the expenses incurred on the charge account. Mautino had a practice whereby he would give a list of names of individuals to Happy's to serve as authorization for those individuals to purchase gas with the Committee's charge account when they were working on the campaign. The Committee's treasurer, who indicated she personally had been authorized to purchase gas with the Committee's charge account, was not reimbursed for gas on a per mileage basis for driving she did related to the Committee or her work in the district office. The charge account was also used to pay for repairs to Mautino's four personal vehicles.

         ¶ 12 Between 2000 and 2015, the Committee reported $159, 028 in expenditures to the Bank. The expenditures were actually checks written to the Bank for the purpose of withdrawing cash, which was often in whole dollar amounts, and that cash was used for expenditures to other vendors. Either Mautino or the Committee's treasurer would write and cash the checks. Some of the expenditures were for travel expenses for meetings, while others were for election-day expenses, such as hiring poll watchers, precinct walkers, or phone callers. It was the Committee's practice to obtain and keep receipts for expenses it paid with the cash from the Bank. The Committee treasurer disposed of the receipts after Mautino was appointed Illinois Auditor General. As to the travel expenses, Mautino would write and cash a check prior to leaving for the meeting. Mautino would sometimes, but not always, bring back receipts from the expenses he incurred when traveling. In 2014 and 2015, the Committee reported 13 expenditures as being for Chicago or Springfield meetings or travel expenses. The 13 expenditures were in whole dollar amounts, such as $150, $200, and $250. The Committee's treasurer did not recall an instance where Mautino deposited cash with the bank when he returned from travel with receipts for expenses totaling an amount less than the amount of cash previously obtained from the bank. The committee reports did not indicate Mautino sought additional cash for unexpected expenses during travel nor did they disclose contributions from Mautino relating to unexpected expenses paid by Mautino personally during travel.

         ¶ 13 The December 14, 2012, letter addressed to the Committee from a Board staff member requested clarification concerning a quarterly report as to expenditures reported to various individuals for gas, travel expenses, expenses for a golf outing, and expenses for a county fair booth. The Board staff member asserted, citing the administrative rules and regulations interpreting sections 9-6, 9-10, and 9-11 of the Election Code (10 ILCS 5/9-6, 9-10, 9-11 (West 2010)), "expenditures need to be listed by vendor instead of listing the individual or committee who was reimbursed for the payment of the expenditures." See 26 Ill. Adm. Code 100.70, amended at 35 Ill. Reg. 2295 (eff. Feb. 4, 2011).

         ¶ 14 B. Supporting Briefs

         ¶ 15 Following our remand, the Board allowed the parties to submit written briefs in support of their respective positions as to whether Cooke had proven his section 9-8.10(a)(2) and (a)(9) claims.

         ¶ 16 1. Cooke's Brief

         ¶ 17 As to his section 9-8.10(a)(9) claim, Cooke asserted section 9-8.10(a)(9) "allows a committee to reimburse people who use their own vehicles for campaign or governmental purposes for their actual mileage, but prohibits expenditures for gas and repairs of a vehicle unless the vehicle is both: (1) owned or leased by the committee; and (2) used primarily for campaign purposes or for the performance of governmental duties." Cooke contended:

"The reason for this is not difficult to understand: Once someone's gas tank is filled, there is no way to ensure that the gas will only be used for permissible purposes. Reimbursements for actual mileage eliminate this problem." Cooke argued, because the evidence showed the Committee paid Happy's directly for gas and repairs of personal vehicles, the Committee violated section 9-8.10(a)(9).

         Cooke requested the Board impose, at a minimum, a $225, 109.19 fine in accordance with section 9-8.10(b) of the Election Code (10 ILCS 5/9-8.10(b) (West 2014)), as the evidence demonstrated the Committee knowingly made expenditures in violation of section 9-8.10(a)(9).

         ¶ 18 As to his section 9-8.10(a)(2) claims, Cooke argued, because it was virtually certain at least some of the gas and repairs paid for would be used for personal as opposed to campaign or governmental purposes, the Committee violated section 9-8.10(a)(2) by making expenditures in excess of the fair market value of any services the Committee received in exchange. Cooke also argued, because the checks to the Bank were cashed in whole dollar amounts and no excess cash was ever returned, the Committee violated section 9-8.10(a)(2) by making expenditures in excess of the fair market value of any services the Committee received in exchange. In so arguing, Cooke specifically highlighted the expenditures for travel expenses and suggested it was "implausible" Mautino could have known in advance the exact cost of travel expenses, and the travel expenses inevitably cost less and the remaining cash was not returned. Cooke also noted Mautino could not claim he consistently took less cash than he actually spent, as he would have been required to disclose his costs as contributions to his campaign, which he did not do. Cooke requested, in accordance with section 9-8.10(b), the Board to impose, at a minimum, a $225, 109.19 fine based on the Committee's unlawful expenditures to Happy's and a $159, 028 fine based on its unlawful expenditures to the Bank for its knowing violations of section 9-8.10(a)(2).

         ¶ 19 2. Committee's Brief

         ¶ 20 As to Cooke's section 9-8.10(a)(9) claim, the Committee argued the evidence failed to show a knowing violation occurred, as its treasurer indicated "the gas paid for by the Committee was in accordance with the direction given *** by Board staff and [the treasurer's] historical practice of reporting." The Committee also noted its treasurer "never received any notification from the Board that expenditures to [Happy's] for gas and repairs should detail the ownership of the vehicles involved or be shown as direct reimbursements."

         ¶ 21 As to Cooke's section 9-8.10(a)(2) claims, the Committee initially asserted section 9-8.10(a)(2) concerned "the price a reasonable person would pay to purchase an item or service that is also charged to other people." The Committee argued the evidence failed to show it "paid more for gas at Happy's than paid by others." The Committee also argued the evidence failed to show it paid more than the fair market value for the various expenses with the funds withdrawn from the Bank.

         ¶ 22 C. Board Meeting

         ¶ 23 On July 10, 2018, the Board conducted a special meeting to address the matters in this case. The Board initially issued a nunc pro tunc order finding the Committee violated sections 9-7 and 9-11 of the Election Code (id. §§ 9-7, 9-11) based on its accounting and reporting of committee expenditures. The Board then allowed the parties to present oral argument in support of their respective positions as to whether Cooke had proven his section 9- 8.10(a)(2) and (a)(9) claims. Prior to doing so, Chairman William J. Cadigan indicated the Board would "wait until we make a determination on the (a)(2) and (a)(9) violations before we deal with the issue of fines."

         ¶ 24 As to his section 9-8.10(a)(9) claim, Cooke asserted section 9-8.10(a)(9) "prohibits paying directly for gas and repairs of vehicles not owned or lease[d] by the [C]ommittee" and argued the evidence showed the Committee violated that section by paying Happy's directly for gas and repairs of personal vehicles. As to his section 9-8.10(a)(2) claims, Cooke argued the evidence showed the Committee violated section 9-8.10(a)(2), as the manner in which the Committee made expenditures at Happy's and the Bank inevitably allowed for money to be used for personal purposes for which the Committee received nothing in exchange. Cooke requested the Board impose fines as outlined in his supporting brief.

         ¶ 25 As to Cooke's section 9-8.10(a)(9) claim, the Committee asserted section 9- 8.10(a)(9) was modified by section 9-8.10(c) of the Election Code (id. ยง 9-8.10(c)) to allow a political committee to directly pay for gas and repairs of personal vehicles when they are used for campaign or governmental purposes and, as such, its direct payment to Happy's for gas and repairs of personal vehicles did not violate section 9-8.10(a)(9). The Committee also argued the evidence failed to show it committed a knowing violation where it followed the directions from a Board staff member in the December 14, 2012, letter to report gas spent to the vendor and not the individual. As to Cooke's section 9-8.10(a)(2) claims, the Committee argued the evidence failed to show it paid more than the fair market ...


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