OLYMPIA — A lawsuit accusing initiative promoter Tim Eyman of concealing the source of donations and accepting kickbacks in the course of a 2012 initiative campaign is factually wrong and politically motivated, his lawyer asserted in a legal filing Tuesday.
In the Thurston County Superior Court filing, Bothell attorney Mark Lamb contends that the lawsuit filed by Attorney General Bob Ferguson misstates Washington campaign finance laws and seeks to broaden their reach in order to impose an “unconstitutional prior restraint” on the conservative activist’s right to participate in the political process.
“A close examination of this case reveals there is not a violation of law, which is why we are asking the Court to dismiss this action in its entirety and are seeking attorney’s fees,” Lamb said in a statement.
Eyman and representatives of the Attorney General’s Office were not immediately available for comment.
Ferguson filed a civil suit March 31 in Thurston County alleging Eyman secretly moved campaign funds between two initiatives in 2012 and received hundreds of thousands of dollars in kickbacks from the firm that collected signatures for the measures.
The suit sought $1.8 million in penalties against Eyman. It also demands the Mukilteo resident return the $308,185 in payments from the signature-gathering firm, Citizen Solutions LLC. The complaint also seeks nearly $925,000 in penalties against an executive of the company, William Agazarm.
Ferguson also asked the court to permanently bar Eyman from handling financial transactions of any political committee in the future. Eyman, as a result of previous transgressions, is barred under a 2002 court agreement from serving as treasurer for any political committees.
Even with that limitation, Eyman “still managed to weave an elaborate web of financial transactions to hide campaign funds, enrich himself while keeping his contributors and the public in the dark,” Ferguson said in March. “Tim Eyman knew what he was doing and he personally profited by his actions.”
Lamb filed his 10-page response and counter claim Tuesday morning. It denies every allegation of wrongdoing. It admits Eyman received money from Citizen Solutions but disputes the claim that it was spent in violation of state laws. The response also objects to keeping Thurston County as a venue because neither Eyman nor Agarzam live in the county.
In the counter claim, Lamb insists the state action violates Eyman’s rights under the First Amendment and state Constitution allowing citizens to “freely speak, write and publish on all subjects.”
And Lamb offers a list of potential defenses Eyman may assert, including that any wrongdoing was the fault of another party, that the statute of limitations has expired and that Ferguson should not be involved in the case.
It notes Ferguson, as a private citizen and political official, has “consistently opposed” ballot measures put forth by Eyman.
“The government’s complaint misstates both the law and the facts,” Lamb said. “The Attorney General seeks to rewrite campaign finance statutes to silence someone he disagrees with: our Constitution does not allow this.”
This legal odyssey began in 2012, when Sherry Bockwinkel, of Tacoma, filed a complaint with the Public Disclosure Commission alleging Eyman failed to report that he was shifting money donated for Initiative 1185, a tax-limiting measure, into the campaign for Initiative 517, which sought to reform the initiative and referendum process.
Under state election law, money can be moved from one political committee to another but it must be disclosed in reports to the commission. And the sources of the money that is getting shifted must be revealed, as well.
A three-year PDC investigation used bank records, emails and interviews to support allegations that Eyman steered payments through his political committee, Voters Want More Choices, to Citizen Solutions, knowing a portion of the money would be paid back to him for personal use and political activities.
Commissioners considered the alleged wrongdoing so egregious that they voted in September 2015 to send Ferguson the findings of the investigation and request he pursue action.
Eighteen months later, Ferguson’s office filed the civil suit.
Voters Want More Choices conducted the campaign for I-1185 and paid Citizen Solutions $623,325 for collecting signatures.
The firm actually earned nearly $1.2 million for its work, with the rest coming from the Association of Washington Business and Association of Beer and Wine Wholesalers.
On July 11, 2012, four days after Eyman turned in I-1185 petitions with 320,000 signatures, Citizen Solutions wired $308,185 to Eyman through his for-profit company, Watchdog for Taxpayers.
The lawsuit alleges William Agazarm approved the payment to Eyman “with knowledge that the funds would be used to obtain signatures for I-517” for which signatures were being gathered.
Ferguson contends Eyman understood the purpose of the money and broke the law when he failed to report it.
The legal filing acknowledges Eyman loaned nearly $200,000 in 2012 to a Virginia group, Citizens in Charge, which supports citizen initiatives. Eyman denies the state’s allegations that he did so knowing the group would turn around and give $182,000 to the I-517 signature-gathering effort.
A version of this story originally ran in the Everett Herald.