Complaint against Montana’s ‘dark money prosecutor’ dismissed

HELENA — Allegations that a high-profile state-appointed attorney broke some of the same campaign practices laws he was hired to prosecute have been dropped.

Deputy Commissioner of Political Practices Kirsten Madsen, in a 19-page order issued Friday, dismissed a complaint filed late last year against Billings attorney Gene Jarussi by Republican political consultant Jake Eaton.

Since his appointment by former Commissioner of Political Practices Jonathan Motl in 2015, Jarussi has served as a state special attorney general in charge of prosecuting a series of high-profile lawsuits against candidates and political groups accused of illegal campaign activities.

In a complaint filed in November 2017, Jake Eaton, a consultant with the Billings-based Political Company, accused Jarussi and his wife, Karen, of illegally coordinating with Billings Democratic Rep. Jessica Karjala’s 2016 re-election campaign. Eaton claimed the Jarussis facilitated “electioneering communication” that benefited Karjala’s campaign while Karen Jarussi was “acting as a paid agent” of Karjala’s campaign.

Eaton called on Commissioner of Political Practices Jeff Mangan to remove Jarussi from ongoing litigation involving the office, and he also called on Mangan to recuse himself from the complaint and to appoint a Republican lawyer to handle the investigation. Mangan did not remove Jarussi from any pending litigation he was working on on behalf of the commissioners office, and he refused to comment on the complaint per his office’s policy against talking about ongoing investigations or litigation.

According to the complaint dismissal issued Friday, Mangan did recuse himself from the portion of the complaint involving Gene Jarussi, and appointed Kristen Madsen, a lawyer with the Montana Department of Justice’s Agency Legal Services Bureau, to handle the matter. In a 19-page order, Madsen said there was no evidence to support Eaton’s claim that Jarussi violated state campaign finance laws.

“Having duly considered the matters raised in the Complaint concerning the individual conduct of Mr. Jarussi, and having completed a review and investigation thereof, this Deputy Commissioner hereby holds and determines, under the above stated reasoning, that there is no evidence of a campaign practice violation, and certainly none sufficient to justify a civil adjudication against Mr. Jarussi as complained of in this Matter,” Madsen wrote.

Jarussi was traveling to his farm in south central Montana when contacted by Montana Free Press and had not had a chance to read the full decision. However, Jarussi said he always tried to follow the law.

“You know, I tried to be careful not to violate the law, the rules. I didn’t think I had violated the rules. I felt I complied,” Jarussi said. “And if I had violated the rules, I’m not above the law, and I should be held accountable, too. But I really felt like I was OK because I really tried to be very careful about following the rules.”

Eaton said the fact that Jarussi admitted to working against Karjala’s Republican challenger, Robert Saunders, was “disgusting.”

“These cases are, by their nature, political, and they require at least the appearance of impartiality and fairness,” Eaton said. “How can we have that when somebody is simultaneously prosecuting one political party and actively working to defeat them in elections? How can anybody believe that’s fair?”

On Thursday, a day before Eaton’s complaint was dismissed, a group of more than 30 Republican lawmakers submitted a two-page letter to Mangan, calling on the commissioner to remove Jarussi from any active cases involving the office.

The letter, which carried the official state seal and was printed on “Montana State Legislature” letterhead, cited Eaton’s complaint against Jarussi as part of the basis for why they were calling for his removal.

“Make no mistake, Mr. Jarussi deserves a thorough investigation that will ultimately determine his guilt or innocence,” the letter stated in part. “However, one thing is abundantly clear from this complaint: Mr. Jarussi’s behavior was highly inappropriate, especially considering that he was simultaneously acting as a Special Attorney General for the prosecuting cases that involve similar actions as those he himself is alleged to have committed.”

A draft version of the letter circulated among Republican lawmakers last week by Republican Senate Leadership staffer Lindsey Singer, contained a version of the document that, according to the document’s properties, was drafted by Eaton.

Eaton said he played a role in drafting the letter, but denied that he was the letter’s author.

“I would say, yes, I assisted in the effort,” Eaton said when asked about his role in drafting the letter.

Asked whether the letter was initiated by Republican leadership, or whether Eaton drafted the letter and then sought-out the support of Republican lawmakers, Eaton had this to say:

“There are 33 Republican legislators who were very concerned that we have a commissioner of political practices who thinks it’s OK to have a partisan hack lawyer out there persecuting his political opponents while committing campaign finance violations,” Eaton said.

In a response issued to members of the media Friday morning, Mangan said the COPP does not comment on open, ongoing investigations.  In an uncharacteristically terse statement, Mangan said:

“It is a regrettable letter, not signed by any member whose name appears on the letter, not printed on any official letterhead the Commissioner’s Office is familiar with, hand delivered by a political consultant with her business card attached and was apparently delivered to the media at or around the same time.”

Mangan went on to add, “it is incumbent on the COPP determine such a correspondence is not intended to assert improper political influence on an independent, non-partisan government agency. Montana law restricts the commissioner from ‘participating in political activity,’ including partisan pressure and influence.”

Mangan said any official reply to the letter would be made to the “alleged signatories, professional, personally signed, not through the press, and certainly not through a paid, political communications consultant.”

Speaker of the House Austin Knudsen, R-Culbertson, did not return a call seeking comment on the letter. Calls to other signatories of the letter also were not immediately returned.

Lindsey Singer, the Helena political consultant who circulated the letter for signatures, confirmed that her participation related to the letter was in her capacity as a Senate majority aide, a position paid for by the state.

Gene and Karen Jarussi denied Eaton’s allegations from the start, and said his complaint against them was politically motivated.

At the time the complaint was filed, Eaton was a witness in a lawsuit against the Montana Growth Network, a “dark money” political group accused of failing to report and disclose hundreds of thousands of dollars it spent in Montana’s 2012 elections. Dark money groups are organizations who spend money on influencing elections but don’t have to disclose the source of their funding.

Eaton’s former firm, 47 North Communications, provided consulting services to Montana Growth Network during the time in question, and Eaton was named as a witness in the case.

Last July, a judge sanctioned Eaton’s wife, Billings attorney Emily Jones, and ordered her to pay $14,970 in legal fees to Jarussi, who was representing the state in the case. District Judge Kathy Seeley determined that Jones inappropriately warned other witnesses to withhold evidence. The judge also forwarded her order to Office of Disciplinary Counsel.

In a March 15, 2018, order in that case, Seeley also addressed the question about whether Jarussi had a conflict of interest that prevented him from serving as the prosecutor in the matter.

The Montana Growth Network argued the Billings-based law firm that Jarussi was working out of should be barred from participating in the prosecution because one of the firm’s partners, John Heenan, is running for the U.S. House as a Democrat. The group also argued that Jarussi should also be removed from the case because he was working out of that same law office.

The judge rejected that claim.

“Without specific evidence of a conflict or other disqualifying relationship or action, Heenan’s campaign as a democrat for public office does not disqualify the law firm or Jarussi by association to the law firm,” Seeley wrote.

On April 13 the Montana Growth Network settled with the state. Under the terms of the settlement agreement, the group agreed to pay a $30,000 fine and admit that it violated the state’s campaign practices laws.

John Adams is the founding editor of The Montana Free Press, where this story was first published.