Hillary calls claim of felony 'fantasy'

Hillary Clinton greeted at August 2000 Hollywood gala and fund-raiser by Peter Paul and his wife Andrea (Courtesy Hillcap.org)

Sen. Hillary Clinton's legal team denies a "smoking gun video" captures the New York Democrat and her campaign in the act of committing a felony, calling the assertion "pure fantasy" and "much ado about nothing."

As WND reported, the tape of a July 17, 2000, phone call was submitted as evidence to a California appeals court last month in a civil fraud suit by business mogul Peter Franklin Paul against the New York Democrat and her husband, former President Bill Clinton. WND reported in April that Paul charged the tape shows Sen. Clinton – despite denials throughout six years of investigation – taking an active role in the production of a lavish Hollywood fundraiser in August 2000 that eventually cost him nearly $2 million.

Watch video of July 17, 2000, phone call

Paul contends Sen. Clinton's participation in soliciting performers and planning the event would make his more than $1.2 million in contributions a direct donation to her Senate campaign rather than to a joint fundraising committee, violating federal statutes that limit "hard money" contributions to a candidate to $2,000 per person. Knowingly accepting or soliciting $25,000 or more in a calendar year is a felony carrying a prison sentence of up to five years.

The videotape was filed with the California Court of Appeal in Los Angeles County as evidence in an appeal of an April 7, 2006, decision by Los Angeles Superior Court Judge Aurelio Munoz granting Sen. Clinton her motion to be dismissed from the case based on the state's anti-SLAPP law, which, under the First Amendment, protects politicians from frivolous lawsuits during their election campaigns.

Paul's attorneys have argued Sen. Clinton violated the federal code and, therefore, according to the law, would not be covered by the anti-SLAPP statute.

In his April 2006 ruling, Munoz scheduled a trial to begin March 27 this year, but it was delayed when in September he ruled the discovery process – which likely would require the former president and his wife to testify under oath – could not proceed until the anti-SLAPP appeal is resolved.

Paul maintains that whether or not Sen. Clinton is a defendant or material witness, his claim against the Clintons would not be affected. But he says he rejects the idea Sen. Clinton "should be released as a defendant through her abuse of the First Amendment protections" and "her perversion of the intent of the Anti-SLAPP law to protect poorly funded politicians from oppressive law suits."

Just a message of thanks

Longtime Clinton attorney David Kendall filed a reply brief to the submission of the video evidence, contending, "To the extent that it is authentic, the videotape shows that Senator Clinton is gracious to her supporters, that she has a sense of humor, and nothing more."

Kendall argues any contribution from Paul toward the Hollywood event should be credited to a joint fundraising committee, New York Senate 2000. The state account, not subject to the federal $2,000 individual limit, was run jointly by Clinton, the Democratic Senatorial Campaign Committee and the New York State Democratic Party.

Paul's attorney, Colette Wilson of the U.S. Justice Foundation, insists Kendall's reply fails to address the main point – that Sen. Clinton directly solicited the funds and applied some control over them, in violation of section 441 of the Federal Election Commission code.

The code says, "Expenditures made by any person in cooperation, consultation or concert with, or at the request or suggestion of a candidate or their agents shall be considered to be a contribution to such candidate," and, therefore, subject to limits.

Wilson argues that while joint campaign committees such as New York Senate 2000 have helped candidates get around the $2,000 limit on contributions directly to their campaigns, the FEC regulation considers any donation specifically requested by a candidate to be the same as a direct contribution to the candidate.

Kendall contends all of the agents involved in the donation worked for New York Senate 2000. But Paul argues the videotape captures Clinton designating her then-White House aide, Kelly Craighead, as her agent in daily contact with Paul, who advised the senator as to when her personal involvement would be helpful. Clinton is recorded saying Craighead, a White House employee with no relationship with any joint fundraising committee, "talks all the time" with Paul about details concerning coordination of the event, "so she'll be the person to convey whatever I need."

"Her responsive brief amounts to an admission (of guilt), because it makes no denial of Craighead's role as her agent," Paul told WND.

In a sworn declaration, Paul also points out, Sen. Clinton said she hired Grammys producer Gary Smith to produce the fundraising concert part of the gala for "her Senate campaign."

Paul also contends President Clinton and aide Jim Levin were agents in soliciting the funds. The complaint charges the former president destroyed Paul's entertainment company to get out of a $17 million deal in which Clinton promised to promote the firm in exchange for stock, cash options and massive contributions to his wife's 2000 campaign. Paul says he was directed by the Clintons and Democratic Party leaders to foot the bill for the Hollywood event.

Paul believes it's significant Sen. Clinton's legal team and a judge have made a point over the past six years of insisting that she had no knowledge of the preparations for the Hollywood event, including at the 2005 trial of her campaign finance director, David Rosen, who was acquitted of filing false financial reports of the fundraiser. Clinton-appointed U.S. District Judge A. Howard Matz declared the senator "has no stake in this trial as a party or a principal" and is "not in the loop in any direct way, and that's something the jury will be told."

The video, contends Paul, now proves Sen. Clinton's direct involvement.

In his reply brief, Kendall argues the purpose of section 441 is to "limit disguised contributions, expenditures made by an individual with a 'wink or nod' to a political candidate, which often will be as useful to the candidate as cash."

Wilson contends, pointing to the Supreme Court case Buckley v. Valeo, the court held the purpose of the statute is to ensure candidates are not beholden to a donor.

She argues Kendall's point – that New York Senate 2000 partially benefited from the event – is not relevant, because, as the tape indicates, 100 percent of the $1,000 charged for tickets went to Sen. Clinton's campaign.

Kendall maintains Paul's legal team has failed to identify a single case in which a court has found that in-kind contributions to a joint fundraising committee are "coordinated contributions."

Wilson says she did cite a Christian Coalition case that addressed the question of how to determine what constitutes a contribution to a candidate.

"It's control the candidate has over the contribution. That is key," she said. "Hillary Clinton says (on the tape) she was going to be checking in from time to time. Her agent, Kelly Craighead, was on her staff, her personal assistant. She said Kelly fully briefed me, she is in constant contact with Peter."

Wilson further argues the event was not conceived by New York Senate 2000 but by Levin, Craighead, Rosen and Aaron Tonken, the Hollywood charity event planner later convicted of fraud. Rosen worked for New York Senate 2000, but he also was Sen. Clinton's Senate campaign finance director.

Wilson explained: "Tonken says, 'I want to put on an extravaganza for the president and first lady.' The Clintons told him it has to be a fundraising event and has to coincide with the Democratic convention. They exercised control over the whole concept. Levin called Peter Paul the next day and asked, "Will you pay for it?"

Kendall also argues the FEC "has never suggested – in this case or in any other – that large in-kind contributions to a joint fundraising committee should be attributed to an individual candidate. Therefore, it strains credulity to suggest that Defendants 'knowingly and willfully' violated a rule, which no court or federal agency has ever recognized."

Wilson replied: "It sounds like they're saying if you don't have a court case where there has never been such an issue, it doesn't matter if there is a law on the books. To me the law could not be more clear. If you have coordination, solicitation by the candidate of the contribution, and are exercising control, that makes it a contribution (to the candidate)."

Sen Clinton's legal team also suggested that under California law, the taping of the phone conversation was illegal. But Wilson says that because Clinton was aware the call was on a speaker phone heard by anyone in the room, she had no reasonable expectation of privacy.

A California appeals panel will make a decision this fall on whether Sen. Clinton will be a party in the case. Oral arguments likely will be in September or October, and a ruling could come about a week later, she said.

Regardless of the outcome, the Clintons will be deposed, Paul says, along with a host of celebrities who have direct knowledge of the deal he says he made with the former president.

Previous stories: