Investigations of the IRS are taking place not only in Congress but also in court. One case, which has developed slowly since it was filed in 2010, reveals much about both the long reach of the agency and the interwoven nature of the broader federal bureaucracy.
Defending IRS commissioner John Koskinen against the claims of the pro-Israel group Z Street is Andrew Strelka — and before joining the Department of Justice’s civil-trial section, Strelka worked at the IRS for Lois Lerner, who was then the agency’s head of exempt organizations. As it happens, this is the very IRS division at which the mistreatment of Z Street is alleged to have occurred — and Strelka worked there at the very time Z Street’s application for tax-exempt status was being considered.
Scott Coffina, a partner at the Washington, D.C. law firm Drinker Biddle & Reath and a former Justice Department prosecutor says Strelka’s representation could violate Washington, D.C.’s rules of professional conduct for lawyers in “several” ways, in particular the rule that prohibits a lawyer from representing a client in a matter where “The lawyer’s professional judgment on behalf of the client will be or reasonably may be adversely affected” by his personal interests. “If Mr. Strelka was involved in the targeting of conservative groups,” Coffina says, “it is hard to imagine that he can give dispassionate advice. He would have a tough time evaluating the merits of the plaintiff’s case and advising his client on strategies in the litigation. He seems to have a personal conflict of interest.”
Another rule proscribes attorneys from participating in cases in which they might be called as witnesses, though Coffina explains that to be called as a witness and Strelka’s testimony would have to be necessary to the case. “The government might be able to get around it and keep the lawyer in place in there is another IRS employee available to testify on what the lawyer might testify to himself,” he says.
Z Street founder Lori Lowenthal Marcus tells National Review Online of the situation: “Nothing surprises me.”
She filed the group’s application for tax exemption in 2009, and Z Street, whose mission is to educate people about Zionism, sued the IRS for alleged violations of its First Amendment rights the following year. According to Marcus, an IRS employee told her Z Street’s application was sent to Washington for extra scrutiny because the group was “connected with Israel” and expressed opposition to the Obama administration’s foreign policy. (An IRS agent subsequently told the House Oversight Committee that the applications of pro-Israel groups were considered “specialty cases” and routinely sent to an antiterrorism unit for extra screening.) Though the IRS has attempted since 2010 to get the case thrown out of court, Judge Ketanji Brown Jackson ruled in late May that it will move forward, and the agency will have to defend itself in court. Z Street has yet to receive its tax-exempt status.
While at the IRS, documents indicate, Strelka was kept abreast of the agency’s targeting practices. He is one of 14 employees who received an e-mail from agency attorney Ronald Shoemaker on March 17, 2010, instructing them to “be on the lookout for a tea party case.” Shoemaker told the group that if they received any applications “involving an exemption for an organization having to do with tea party [sic], let me know.” Status reports from July and September 2010 tracking the progress of particular applications show that Strelka was handling a case that had been designated to Group 7825, which at the time handled tea-party applications.
Strelka — who did not respond to an e-mail seeking an interview — was working at the IRS as a part of the Presidential Management Fellows Program, a two-year program that aims to groom government leaders in part by placing participants in jobs throughout the federal government. According to his LinkedIn profile, after completing his two years at the IRS, Strelka left for the Justice Department’s civil-trial section in August 2010 and was detailed in the White House Counsel’s office for seven months, from last December until June.
After Strelka left the IRS, Lerner, it appears, remained a mentor. In an August 2012 e-mail, he told Lerner, “I cherished my time in the E[xempt] O[rganizations] family and I owe a big thanks to you for hiring me.” Lerner responded that she was “glad we could be a part of your success.” She also noted, “We’ve had a lot of congressional attention this year.” It is unclear whether she was referring to inquiries from the House Oversight Committee about the criteria being used to screen applications for tax exemption, which began in March 2012.
Strelka’s involvement with the Z Street litigation is not the first case of a former IRS employee stumbling into a role defending the agency. Susanne Sachsman Grooms today serves as deputy staff director for Democratic representative Elijah Cummings (Md.) on the Oversight Committee’s minority side. Cummings has been vocal in his view that the committee’s investigation into the IRS targeting scandal should come to an end, and his public exchanges with committee chairman Darrell Issa (R., Calif.) on the matter have become something of a public spectacle. Between 2008 and 2011, Grooms worked for the IRS as an adviser to the deputy commissioner for services and enforcement and then as a senior counselor to the chief of criminal investigations. Her boss at the time, the deputy commissioner for services and enforcement, was Steven Miller, who went on to be IRS commissioner from November 2012 until his resignation in the wake of the targeting scandal.
As Z Street’s case against the IRS proceeds, the agency will be forced to go through the discovery process, turning over relevant documents to opposing counsel, and to defend its disparate treatment of applications on the basis of the viewpoints expressed in them. It has one advantage: Its lawyer is up to speed.
— Eliana Johnson is a national reporter for National Review Online.