Exclusive: Attorney for Bernie Donor Class Action Calls DNC ‘The Ultimate Ponzi Scheme’

Win McNamee, Justin Sullivan/Getty Images

Backers of Bernie Sanders are suing the Democratic National Committee (DNC) for fraud based on last summer’s hacks revealing systemic bias for Hillary Clinton in the 2016 primary campaign.

The class-action lawsuit, Wilding v. DNC Services Corp., is underway in federal court in Florida, where it is awaiting a ruling on the DNC’s motion to dismiss heard in April. The plaintiff class, Bernie donors who also gave money to the DNC under the assumption of its impartiality in the 2016 primary contest between Clinton and Sanders. The suit alleges fraud, negligent misrepresentation, unjust enrichment, and a consumer protection violation.

The claims are based on the celebrated leaked emails and memos from the “Guccifer 2.0” hacks last June. The leaks appear to show direct assistance of Secretary Clinton to the detriment of Senator Sanders. The novel legal theory is based on the donors having been duped by the DNC’s claims of impartiality.

Attorney Jared Beck of Beck & Lee Trial Lawyers, the firm representing the class of Bernie supporters, spoke with Breitbart News about the developing case and the surrounding controversies.

The entire case shot into the public eye when, according to a notice Beck & Lee filed with the court, their office received a call asking for information about the case from a person using a voice-altering device. A quick lookup of the number revealed it was from a number associated with the congressional office of DNC Chairwoman Rep. Debbie Wasserman-Schultz (D-FL). The DNC’s attorney’s quickly denied any knowledge of the incident, claim the number is from an unused office and is possibly the result of number “spoofing” by an outside source.

Asked about the call, Beck told Breitbart News:

The incident was startling at the time it happened and we are still very puzzled and concerned by it.  The caller had altered his or her voice to be unrecognizable, and refused to identify themselves.  But please understand that this is just one  in a number of disturbing events that have occurred  throughout the case … I have no idea who was behind the call, but according to the Defendants, the matter has been referred to the Capitol Police.

As for the case itself, Beck was confident that general common law principles of fraud and misrepresentation could sustain the Bernie-donors’ claim. “If there is anything “new,” it is the application of these principles to the sphere of political campaigns,” he said.

Beck went on to describe that application as follows:

One might view this application as a natural consequence of Citizens United – an opinion that crystallizes campaign contributions as the quintessential form of American political participation.  By equating political participation with financial contribution, Citizens United, by inference, incorporates all of the common-law principles of fraud, negligent misrepresentation, etc. that typically govern in the economic sphere. Americans have a cognizable interest in the transparent and fair conduct of primary campaigns precisely because they, through their campaign contributions, are also financiers of the campaign.

Asked to make an analogy to a more traditional case of fraud outside the political realm, Beck compared the DNC’s actions with a “Ponzi-scheme,” in which investors buy in based on fraudulent returns that are really just earlier investors:

I would think of this as a case against the ultimate political Ponzi scheme. We are used to the concept of Ponzi schemes in the investment world. In my view, the DNC is really no different: it was purporting to be “selling” a fair primary process but in reality was serving as a front for the Hillary Clinton campaign. People lost well over $200 million as a result.

Beck told Breitbart News that there bringing the facts of the DNC’s conduct to light:

There are two main goals to the litigation: obtaining justice for our clients through whatever legal remedies are available; and having a trial on the issues, so that the public may know the truth of what happened with respect to the 2016 Democratic nominating process.

The circumstances by which the DNC leaks came to light, allegedly by hacks by Russian government agents, has been a major public controversy for nearly a year. If the case survives the motion to dismiss, discovery will begin, potentially bringing a trove of new information to light about the DNC’s internal operations and how they came to be the apparent victim of Russian hacking.

Beck was optimistic about the prospects for discovery:

If we do get to the discovery phase, I think it is safe to say that we expect to find much more evidence of the DNC’s misconduct, with the publicly released material being only the tip of the iceberg.  Also, we will be able to place all of the material witnesses under oath and take their depositions.  In addition, we will be able to conduct discovery on the question of how the DNC’s internal documents came to be placed into the public domain by Guccifer 2.0 and WikiLeaks, which may ultimately be the most important question of all.

It is unclear when the court will rule on the motion to dismiss but Judge William Zloch told the parties in April it would “take some time.”


Please let us know if you're having issues with commenting.