The opinion of the court was delivered by: GREENE
In this action, plaintiffs
request the Court to declare improper the participation of James Miller, III, Chairman of the Federal Trade Commission, in the so-called GM defects case.
In that proceeding, the Commission, by a 3-2 vote, approved a consent decree which provided for arbitration conducted by the Better Business Bureau in lieu of the direct reimbursement relief which had apparently been standard in other proceedings of this type. If Miller had recused himself, at 2-2 tie would have resulted and, under the Commission's procedures, the consent decree would not have been approved.
The request for recusal arises out of Chairman Miller's relationship with Economic Impact Analysts (EIA), an economic consulting firm whose largest client was General Motors. In addition to asking that Miller be ordered recused, plaintiffs also request that the GM defects case be remanded to the Commission for de novo consideration without Miller's participation. Presently pending before the Court are cross motions for summary judgment.
It is useful initially to state what is not involved here. Plaintiffs do not argue that Chairman Miller is disqualified on account of a present or actual conflict of interest. See 18 U.S.C. §§ 207, 208. Their sole claim is that Miller's participation in the GM defects case gave the appearance of a conflict of interest, and it is on this basis that they request that he in effect be ordered to recuse himself, retroactively, from that case.
It is settled law, not disputed by either party, that the appropriate legal standard to be applied in a case such as this is abuse of discretion. See Chitimacha Tribe of Louisiana v. Harry L. Laws Co., 690 F.2d 1157, 1166 (5th Cir. 1982); Blizard v. Frechette, 601 F.2d 1217, 1221 (1st Cir. 1979). It is also clear, however, that, as plaintiffs put it, that "there is little precedent or guidance concerning what [appearance of conflict] means or how it is to be applied."
Factually, plaintiffs' claim consists of two principal elements. One of these revolves around the relationships among Miller, EIA, and General Motors; the second relies on a number of precedents involving high-level executive officials who, it is said, recused themselves in circumstances similar to those presented here.
The crux of plaintiffs' case against Miller may be summarized as follows.
Prior to his appointment as Chairman of the Federal Trade Commission, Miller was chairman of EIA. During the period of his association with that consulting organization, the firm did a substantial amount of work for General Motors; indeed, GM was EIA' largest client, and in the two years preceding the Miller appointment to the FTC, EIA billed General Motors for over $75,000 in consulting fees. Miller received some of these funds during his service as Chairman of the FTC. Further, although EIA is now dormant, it continues to exist, and Miller has not excluded the possibility that he will return to it after his term with the FTC expires.
While these facts, as well as those surrounding the collateral charges summarized in note 5 supra, appear at first blush to lend substantial support to plaintiffs' position, they are less persuasive when viewed in their appropriate context.
First. Miller recused himself from all decisions involving General Motors for a period of two years following the date EIA received its last payment from General Motors. His participation in the GM defects case must be viewed, therefore, in light of the passage of an appreciable period of time following the severance of his relationship with EIA and indirectly from General Motors. Unless Miller were to be regarded as being tainted by those relationships on a permanent basis, the two-year hiatus would appear to be, absent other factors, a reasonable prophylactic measure.
Second. EIA did receive substantial amounts from General Motors for consulting services. However, even so, these fees constituted only between 12 and 25 percent of Miller's income, for during the periods in question he also held a full time, salaried position with the American Enterprise Institute, and his salary from that position provided the bulk of his income.
Fourth. Plaintiffs point out that the consent decree which was approved with Miller's vote was favorable to General Motors. The Court rejects this fact as a basis for disqualification or recusal. The decree was negotiated and recommended to the Commission by its career staff without any participation by Miller.
Beyond that, however, public policy dictates great caution regarding the attribution of weight for disqualification or recusal purposes to the final outcome of a case. Reliance upon such considerations is to invite challenges to officials based not upon true conflicts of interest but upon their philosophical or ideological leanings
or, worse, upon the result that would be brought about by the removal of a particular official from the consideration of a particular controversy.
Fifth. Potentially the most serious problem is Miller's refusal to rule out a return EIA. As indicated infra, several officials have recused themselves from controversies arising during their government service when the entities involved in these controversies -- usually law firms -- were organizations to which they intended to return. However, one fact is present here which takes the present situation out of this norm: EIA is not an organization having a continuous life; it is at present not even a going concern. It is dormant, and it is dormant precisely because EIA is Miller.
Thus, when Miller states that he may return to EIA, he is only saying that he will go back to being in essence a sole practitioner consultant. To require him to pledge that he will not return to EIA, therefore, as a condition of sitting on GM cases during his FTC service, is the equivalent of ...