Lawyer Predicts Dismissal of Claims

The disgruntled former treasurer of former Rep. Tom DeLay's (R-Texas) "leadership" political action committee is trying to again involve Donald McGahn in a lawsuit charging that the PAC's attorneys mishandled a Federal Election Commission enforcement case.

McGahn is a veteran Republican election law attorney, who was recently nominated by President Bush for a GOP seat on the FEC. His nomination is awaiting a Senate confirmation vote.

Corwin Teltschik served as treasurer for DeLay's Americans for a Republican Majority PAC (ARMPAC). He has charged in the suit, now pending in federal court in Washington, that the PAC's attorneys, including McGahn, did not inform him when they settled an FEC enforcement matter on his behalf in 2006.

A lawyer for McGahn questioned the motives of Teltschik and his lawyers in seeking to have McGahn included in the suit. The attorney, Robert Kelner of the Washington firm Covington & Burling, said he was confident that a judge would not allow the claims against McGahn to stand.

Teltschik first filed suit last year in a federal court in Texas citing the FEC settlement. The settlement indicated that Teltschik admitted he had violated campaign finance laws in his "official capacity" as ARMPAC treasurer. Teltschik claimed in his lawsuit that he had little day-to-day involvement in the operation of the PAC and did not know about any legal violations.

Teltschik also claimed he had no idea that the ARMPAC settlement was being negotiated with the FEC by McGahn in 2005 and 2006. He said he learned about it after-the-fact when his wife read the information on the Internet.

According to court documents, Teltschik said that admitting to such violations, which are felonies, damaged his reputation and potentially put him at risk of disbarment in Texas, where he is an attorney. There was no indication that Teltschik has actually been threatened with disbarment.

PAC's Management Firm Sued

Teltschik was a longtime personal friend of DeLay and his wife, Christine, according to the court documents. He was enlisted as ARMPAC treasurer because he was known and enjoyed a good reputation in Texas, the documents indicated, but he was not experienced in campaign finance matters. Teltschik and the DeLays are no longer believed to be on friendly terms.

Other defendants in Teltschik's lawsuit are employees of the Washington law and lobbying firm Williams & Jensen, which helped manage ARMPAC's operations and hired McGahn to represent the PAC in the FEC settlement talks. Williams & Jensen has sought to have the case dismissed.

McGahn was dismissed from Teltschik's lawsuit last year after it was first filed in federal court in Texas. The court said it had no jurisdiction over McGahn, a resident of the Washington area.

However, the case was subsequently transferred to the U.S. District Court for the District of Columbia early this year. Attorneys for Teltschik filed a motion in that court June 4 to reconsider McGahn's dismissal from the case, arguing that the jurisdiction issue was resolved by the transfer of the case (Teltschik v. Williams & Jensen, D. D.C., Civil No. 08-89, motion filed 6/4/08).

McGahn Lawyer Confident of Dismissal

McGahn's attorney, Kelner, said the latest motion would be opposed and that he was "very confident" U.S. District Judge Henry Kennedy would not allow McGahn back into the case.

Kelner said that the judge in Texas who dismissed McGahn from the case had indicated that the claims against him were "weak." The attorney also noted that the judge in Texas, U.S. District Judge Melinda Harmon, refused to dismiss claims against Williams & Jensen, instead transferring the case to Washington.

Kelner indicated that Teltschik's allegations in the case were deficient primarily because it was clear that the FEC settlement involved Teltschik only in his official capacity as a PAC treasurer and were of no consequence to him personally. Kelner cited a "policy statement" on treasurer liability adopted by the FEC in 2005, which he said was intended to make clear that FEC enforcement matters involving treasurers in an "official capacity" should have no legal consequences.

Kelner also noted that lawyers for Teltschik did not attempt have McGahn brought back into the case until he was nominated for the FEC post. He suggested that Teltschik's lawyers were seeking to use McGahn's prominence to gain attention and leverage in the case.

Settlement Shut Down ARMPAC

The settlement at the center of the lawsuit involved FEC Matter Under Review (MUR 5675). It called for ARMPAC to pay a $115,000 fine and shut down. A nine-page "conciliation agreement" said that ARMPAC and Teltschik, in his official capacity as treasurer, violated the law by failing to properly report hundreds of thousands of dollars in financial activity.

The settlement was signed not by Teltschik or McGahn but by Meredith Kelley, an associate in the Williams & Jensen firm. A "designation of counsel" informing the FEC that McGahn represented ARMPAC was signed by Barbara Bonfiglio, a former Williams & Jensen employee, who listed herself as "assistant treasurer" of ARMPAC. There was no separate designation of counsel for Teltschik. According to Kelner, the FEC never asked for one.

A court affidavit McGahn filed last year said that, in preparing to represent ARMPAC in the FEC matter in 2005, he spoke to DeLay--then the House majority leader--as well as DeLay's top aides and Bonfiglio. He did not mention Teltschik.

The FEC settlement of MUR 5675 mentioned only ARMPAC and Teltschik as "respondents." DeLay himself and Williams & Jensen were not mentioned.