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On two fronts: Ethics laws face challenges before Supreme Court and in Statehouse

Chip Brownlee

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Alabama’s ethics laws are under attack on two fronts.

A bill moving through the Legislature would significantly loosen the state’s “toughest-in-the-nation” ethics rules, which govern the behavior of state officials, lawmakers, lobbyists and those who hire them. In the courts, though, another challenge is brewing.

Former Republican House Speaker Mike Hubbard — convicted on 12 felony ethics charges in 2016 for conflicts of interest and using his public office for private gain — is appealing his conviction up to the Alabama Supreme Court, where he and his attorneys are arguing that the laws were too strictly interpreted by lower courts.

The Alabama Court of Criminal Appeals upheld 11 of those charges in a ruling last year, but the Supreme Court has agreed to review his case, meaning a final decision on Hubbard’s conviction under the laws he once championed may not come any time soon.

In an opening brief filed Monday, prosecutors in the Attorney General’s Special Prosecution Divison argue that Hubbard repeatedly violated the law and that his convictions should be affirmed by the Supreme Court.

The attorney general’s prosecutors have asked for oral arguments before the court to, they said, “get the record straight.”

Among other charges, a Lee County jury found Hubbard guilty of soliciting and receiving $150,000 in investments into a failing printing business from four principals, soliciting and receiving valuable financial and business advice from a principal and receiving more than $300,000 in “consulting fees” from two companies who had business before the Alabama Legislature.

Prosecutors said both companies “hired Hubbard to capitalize on his position as speaker.”

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“Alabama’s Ethics Law helps prohibit conflicts of interest and promote Alabamians’ confidence in the integrity of their government,” said Attorney General Steve Marshall.  “As we explained in our brief, Mike Hubbard repeatedly violated those laws, and his convictions should be affirmed.”

Hubbard remains free on appeal bond — nearly three years after his conviction.

Paying full value for a thing of value

On counts 16–19, the jury found Hubbard guilty of illegally soliciting four $150,000 investments into Craftmasters from several prominent Alabama businessmen including Great Southern Wood CEO Jimmy Rane, the state’s richest man.

Hubbard has argued, however, that the investments his printing business — Craftmasters — received weren’t, in fact, a thing of value because he paid “full value” for those investments.

In other words, Hubbard and the investors paid and received no more and no less than what the investment was worth, which is legal under the ethics laws, his attorneys argue.

The “paying full value” provision of the law ensures that lawmakers and officials can’t be prosecuted for buying things. Prosecutors said the investments were gifts and favors provided to divert Hubbard’s path away from “personal and political ruin.”

Craftmasters was on the track to insolvency.

“Hubbard received these $150,000 checks precisely for reasons related to his public service as a public official,” prosecutors argued in Monday’s brief. “Hubbard reminded business leaders … of all the good he had done building and sustaining ‘a 44 pro-business legislature,’ and he threatened to step down if they didn’t step up.”

Between investments Hubbard was accused of illegally soliciting for his Auburn-based printing company Craftmasters, consulting contracts he funneled through Auburn Network Inc. and clients he solicited using his public offices, prosecutors said Hubbard illegally made more than $2 million using his offices as speaker, representative and ALGOP chair.

“The Craftmaster transactions were not arm’s length, and no one was beating down Hubbard’s door to invest in his failing business,” prosecutors said, arguing the investments were not fair transactions, but instead provided because of Hubbard’s political office.

Principals or not?

Hubbard’s attorneys have argued the investors — big business executives — were not principals under the Ethics Law.

The argument is similar to their previous arguments that the investors were “friends” and thus covered under a friendship exemption present in the ethics laws, but it’s different because this reading of the law could have wide-ranging effects for the ethics laws as they are currently interpreted.

Hubbard and his attorneys argue that executives in companies and organizations shouldn’t be considered principals — even if their organizations retain armies of lobbyists. The companies themselves are the principals, not the individual, Hubbard argued, but that reading strays significantly from the wording of the law.

The Ethics Law defines “principal” as “[a] person or business which employs, hires or otherwise retains a lobbyist,” according to Ala. Code §36-25-1(24), and “person” can include a “group of persons.”

The business leaders Hubbard solicited and received contracts, payments and investments from — including Rane and Will Brooke, a BCA executive — did, in fact, hire lobbyists.

But Hubbard is arguing that a person isn’t a principal unless they have an individual contractual relationship with the lobbyist.

“At bottom, Hubbard is asking this Court to graft an exception into the statute that he and his former colleagues declined to enact in 2010,” prosecutors wrote, pointing out that other states have similar exceptions, but lawmakers chose not to include one in Alabama’s law.

“And this ‘Court must apply statutory law as the Legislature wrote it,’ not as Hubbard now wishes he had,” the brief reads, quoting from Hubbard himself.

Another thing-of-value exception

Another exception exists in the law that allows lawmakers and officials to receive money for business relationships are made under “circumstances that make it clear the thing is provided for reasons unrelated to the recipient’s public service as a public official.”

Hubbard is attempting to use that exception to call on the court to overturn two charges that he violated the law by receiving hundreds of thousands of dollars from APCI — a pharmaceutical cooperative — and Edgenuity.

Hubbard was being paid $5,000 a month by APCI for consulting. The money was being sent through his Auburn Network Inc. Hubbard received $210,000 from Edgenuity between April 2012 and July 2014.

While the former speaker is arguing the contracts fall under this exemption, the prosecutors said they are “flagrant violations” of the ethics law.

APCI’s president and CEO testified that Hubbard was hired because he was speaker, which gave him the ability to interact with legislators in other states.

Edgenuity’s president likewise testified that he hired Hubbard because he was speaker, and Hubbard lobbied legislators from other states on Edgenuity’s behalf.

“An ordinary person exercising ordinary common sense could conclude that when companies paid Hubbard huge salaries for little work because he was Speaker, those deals were not ‘in the ordinary course of employment’ and were not clearly ‘unrelated to [his] public service’ as Speaker,” the state’s attorney wrote in their brief.

The state prosecutors summed it up:

In sum, Hubbard asserts (at 20) that he was just trying to “make a living as other citizens do.” But private citizens cannot earn a living through jobs that involve minimal work and training over scotch. They cannot collect hundreds of thousands of dollars for occasionally calling a legislator. They cannot email lobbyists and expect riches. In short, private citizens cannot use a “public office … for private gain.” Ala. Code §36-25-2(a)(3). And under the Ethics Law, Hubbard could not either. Hubbard broke the law and betrayed the public trust. His convictions should be affirmed.

$10,000 a month to sell sippy cups

Hubbard was also found guilty of entering into a contract for $10,000 a month “ostensibly” to help a company sell sippy cups for Robert Abrams, the then-owner of CV Holdings and subsidiaries Capitol Cups and Si02.

He was found guilty of using his position, a state computer, state email account and his state staff to help Abrams sell his products and promote his business. He event got Abrams before Gov. Robert Bentley and the secretary of commerce.

Overall, he received at least $220,000 from Abrams between 2012 and 2014 for “minimal work” or “no discernible work” at all after a certain point.

Hubbard’s argument is that there was not enough evidence that, when he used his office to benefit Abrams, he did so because of the $10,000 monthly checks. The former speaker said the jury got it wrong — that those actions for Abrams had nothing to do with the money.

But the state argues that it presented “direct evidence” that Hubbard used his office and time for private gain in the form of those checks.

Hubbard’s former chief of staff, Josh Blades, testified in blistering testimony at trial that Hubbard said “he had 100,000 reasons” to use the office to “get this done” for Abrams.

“Other than a confession on the stand from Hubbard himself, there could hardly be clearer evidence that he used his chief of staff’s time for his own private benefit, which would materially affect his financial interest,” the state’s attorneys wrote.

On two fronts

If the Supreme Court agrees with any of Hubbard’s legal arguments in this case, barring some narrow ruling on a small inconsistency or problem in the case, such a ruling could have a weakening effect on the state’s ethics laws.

A good ruling for Hubbard could set future precedent for cases prosecuted under Alabama’s ethics laws.

Should the court agree that business executives aren’t principals, it could mean that lawmakers or their businesses could receive hefty cash injections simply because the executives writing the checks don’t have individualized contracts with lobbyists.

Should the court agree that the investments into Hubbard’s printing business were “paid for at full value” despite Hubbard not paying for the loans with money, that would open the door for any business leader to prop up a lawmakers’ failing business for political purposes through loans simply based on the idea that a loan provides a return on investment.

Should the court agree that Hubbard’s $10,000-a-month work selling sippy cups was separate and unrelated from his work for the same company using his state office, that would open the door to a wealth of similar arguments from lawmakers claiming to do a business a good as their elected representative while receiving side cash for a narrowly tailored consulting contract.

“In Hubbard’s view, a principal can put any or all legislators on its payroll precisely because they are legislators and those arrangements would not be ‘related to public service’ unless the contract is for ‘a quid pro quo,'” the state wrote.

At the same time Hubbard and the state are arguing their cases to the Supreme Court, lawmakers are considering an ethics bill that would drastically rein in Alabama’s existing ethics laws in similar ways.

The proposed bill removes the section of code that governs using a public office for personal gain.

It also allows for unlimited gifts from lobbyists or principals to public officials, changes the rules governing lobbyists and principals and more, as APR reported Monday.

The new ethics law would allow a company to designate any member of the organization as the principal. Even if the principal, in this case, say a secretary, was found guilty of committing a crime. The individual cannot be held criminally liable.

The burden of the offense is placed on the corporation, just as Hubbard and his attorneys argued it should be in their court filings.

Current law bans any gifts from lobbyists and principals to public officials over $25. Under SB230, that ban is lifted, allowing a lobbyist or a principal to give unlimited gifts, loans or other things of value to a public official or their family.

Attorney General Steve Marshall is opposing the bill.

New ethics law: A brief analysis

Hubbard will now be given 14 days to file a reply brief, and the Alabama Supreme Court will determine whether to schedule oral argument or decide the case based solely on the briefs.

 

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DOJ’s dropping of charges against Flynn may raise question in Siegelman case

Brandon Moseley

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Defenders of former Gov. Don Siegelman suggested that U.S. Attorney General William Barr’s dropping of federal charges against General Michael Flynn raises questions of the prosecution of Siegelman.

Flynn, a retired Lt. General, was President Donald Trump’s first national security adviser. He was investigated under the Logan Act as part of the wider Russian collusion investigation into the 2016 election, when Trump defeated former Secretary of State Hillary Clinton.

A preeminent scholar in prosecutorial misconduct, Professor Bennett Gershman, has now proclaimed the prosecutors of former governor Siegelman are the ones who should have been charged with a federal crime.

“Yes, the prosecutors should be in jail,” Gershman said. “Of the thousands of prosecutorial misconduct cases I’ve written about, the government’s bad faith described in Stealing our Democracy stands out and may be without parallel.”

“Stealing our Democracy” is Siegelman’s new book. The new book raised more questions of prosecutorial misconduct.

David C. Iglesias is a former Republican U.S. Attorney for New Mexico. He is now an associate professor of Politics and Law at Wheaton College in Illinois.

“If you doubt that politics are the mortal enemy of justice, read Stealing Our Democracy,” Iglesias said. “This is a sobering reminder of the vast powers the federal government has wrongfully used as a sledgehammer to achieve a conviction at any cost. Terrible things happen when you mix politics with prosecutions.”

The White House maintains that the prosecution of Flynn was a political exercise. White House Press Secretary Kayleigh McEnany blasted the effort to prosecute Flynn.

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“The FBI exists to investigate crimes. But in the case of Lieutenant General Michael Flynn, it appears that they might have existed to manufacture one,” McEnany said at the White House press briefing. “As the motion filed by the Department of Justice yesterday explained, the FBI set out to interview General Michael Flynn, when they had no predigate [sic] — predicate for any investigation of any crime.”

“Over the past week, we learned, from a handwritten note, the true intent behind the FBI’s investigation of Lieutenant General Michael Flynn,” McEnany explained. “The very day that then-FBI Director Jim Comey sent agents to the White House to interview Flynn, the FBI discussed what their intent was beforehand. This is what they said: “What is our goal? Truth, admission? Or to get him to lie so we can prosecute him or get him fired?” These notes, in addition to other evidence, raise serious questions about the handling of the — of the FBI’s handling of Michael Flynn’s case.”

Siegelman’s supporters maintain that is what happened to the former Governor.

Law Professor John Farmer is the former Dean of Rutgers Law School and seems to agree with Professor Gerhman.

“Don Siegelman’s story is nothing less than an American tragedy,” Farmer wrote. “Understanding the abuses he experienced may well be the first step to ending them and to healing our broken politics.”

Siegelman is the only Democrat to be elected as the Governor of Alabama since 1982’s election of George C. Wallace (D). Siegelman served as Governor from 1999 to 2003. He was narrowly defeated by then-Congressman Bob Riley, R-Ashland, in the 2002 election after just one term as Governor. Siegelman was mulling a run for the Democratic nomination for president of the United States in 2004.

Siegelman claims that he was then targeted by President George W. Bush’s Department of Justice and claims that he was prosecuted on the orders of GOP strategist and top Bush White House political strategist Karl Rove.

Flynn’s guilty plea was overturned and the case against him lifted with the aid of AG William Barr and the Trump Department of Justice after being investigated and prosecuted by Barack H. Obama’s holdovers at the DOJ, whom some Republicans accuse of attempting a legal coup against the incoming Trump officials. Siegelman on the other hand was prosecuted during the 2006 election when he was running to regain the Governor’s mansion. Siegelman, then under a legal cloud, lost the Democratic primary to then Lt. Governor Lucy Baxley (D). Baxley was then trounced by Gov. Riley. Siegelman was convicted by a jury of his peers and his convictions were upheld by the federal court system, spending years in prison until 2017.

Siegelman claims that his new book raises more questions of prosecutorial misconduct in his case.

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Gov. Kay Ivey extends public health emergency, issues COVID-19 lawsuit protections

Eddie Burkhalter

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Gov. Kay Ivey on Friday extended the formal “public health emergency” for 60 days, beginning May 13. 

Ivey also issued another proclamation that provides liability protection for businesses and health care providers from being sued over COVID-19 matters if those businesses and health care providers “comply with or reasonably attempt to comply with applicable public health guidance.”

Ivey’s order also states that the emergency liability protections would cover businesses and health care providers unless they show “wanton, reckless, willful or intentional misconduct.” 

“I want to do everything within my authority to protect businesses as Alabama’s economy gets up and running again,” Ivey said in a statement. “As we resume operations, the very last thing a business owner needs to worry about is a frivolous lawsuit from responding to COVID-19. Let me be clear, this in no way shields them from serious misconduct. If someone knowingly abuses the public during a time of crisis, they should be held accountable and prosecuted as such.”

Ivey is to hold a press conference at 11 a.m. to discuss possible changes to her “safer-at-home” order. The new proclamations issued Friday morning are separate from the state’s public health orders.

The existence of the states of emergency simply allows the governor to take extraordinary steps to deal with an emergency situation.

Eighth proclamation summary:

  • The order provides safe harbor to health care providers, businesses, and other entities to encourage “reopening our state.”
  • The order protects health care providers from a frivolous lawsuit based on actions they took or failed to take as a result of the COVID-19 pandemic.
  • The order protects businesses from frivolous lawsuits when they conduct COVID-19 testing or distribute PPE to help protect people from COVID-19.
  • The order “in no way shields these groups from claims of egregious misconduct. Claims based on egregious misconduct would be allowed to proceed,” according to the governor’s office.

Ninth proclamation summary:

  • One provision allows for probate judges to improve procedures for administering the July 14 primary runoff election.
  • Probate judges would be allowed to reduce the number of poll workers, if necessary. They would also be allowed to conduct poll-worker training remotely.
  • Another provision “cuts red tape for electric co-ops seeking to obtain emergency loans.” This will “help ensure that electrical cops are still able to provide electricity to their members during this public health emergency.”
  • A final provision will extend the formal “public health emergency” for 60 days, beginning May 13.

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Appeals court refuses to lift injunction prohibiting Alabama from banning abortions

Chip Brownlee

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A federal appeals court Thursday refused to lift a preliminary injunction prohibiting Alabama from banning abortions during the COVID-19 epidemic.

The 11th Circuit Court of Appeals on Thursday issued a ruling that denied the state of Alabama’s request to stay a preliminary injunction issued by federal district court Judge Myron Thompson.

The decision ensures that the injunction prohibiting the state from banning abortions as part of its COVID-19 response will remain in effect throughout the appeal. Abortion care will continue to be available.

“Today, the court refused to allow Alabama to use the COVID-19 crisis as a pretext to prevent patients from accessing abortion care,” said Alexa Kolbi-Molinas, senior staff attorney at the ACLU Reproductive Freedom Project. “This is a critical victory that recognizes that government response to the pandemic must be grounded in public health, not politics.”

The decision comes after Attorney General Steve Marshall appealed Thompson’s partial blocking of the state’s temporary ban on abortions amid the COVID-19 pandemic.

In his order, Thompson said of Alabama’s temporary ban on elective procedures, “for some group of women, a mandatory postponement will make a lawful abortion literally impossible. Under Alabama law, a woman’s window for seeking a lawful abortion is limited: abortion becomes illegal when the probable post fertilization age of the fetus is at least 20 weeks.”

Marshall and the state of Alabama have argued that State Health Officer Scott Harris’s order “covers all elective medical procedures, including abortions.  The purposes of the order are to promote social distancing and ensure that scarce healthcare resources—including personal protective equipment for medical providers—are available for the fight against COVID-19.”

“This ruling ensures that everyone in Alabama can continue to make the decision about whether to have an abortion for themselves,” said Randall Marshall, executive director of the ACLU of Alabama. “We will keep fighting to hold our politicians accountable to protecting the needs of our communities, rather than using the pandemic to further an anti-abortion agenda.”

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Corruption

Will Mike Hubbard ever go to jail? Yes. And likely soon.

Josh Moon

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Mike Hubbard is likely going to prison within the next couple of months. 

Hubbard, the former Alabama House speaker, had his conviction on 11 felony ethics counts partially upheld last week by the Alabama Supreme Court. The justices overturned five of the charges and sent them back to the Alabama Criminal Court of Appeals for review, but upheld six of his charges. 

And those six matter a lot. 

Under the original sentence imposed by Lee County Circuit Court Judge Jacob Walker, Hubbard was set to serve four years in prison and eight years of probation. That sentence was structured in a manner that all but assured that Hubbard would serve that time unless the entire verdict against him was overturned. 

It wasn’t. And a source familiar with the ALSC’s opinion in the case told APR that the justices were fully aware that their opinion would not lessen Hubbard’s jail time. 

That ALSC opinion puts an end to Hubbard’s appeals bond that has allowed him to remain a free man as his case worked its way through the appeals process over the past four years. 

According to the Lee County Circuit Court clerk’s office, once a final determination is made by the ALSC on charges that result in a sentence, that opinion is the final piece supporting the need for an appeals bond.

Basically, there are no additional avenues for appeal that could possibly result in Hubbard not serving his prison sentence, so the bond has to be revoked and Hubbard sent to prison.  

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Once Walker receives the certificate of judgment from the ALSC showing it upheld the counts that related to Hubbard’s sentence, that should prompt Walker to revoke the bond and Hubbard will be notified that he is expected to begin his prison term. 

According to Scott Mitchell, the clerk of the Alabama Court of Criminal Appeals, that certificate of judgment can’t be issued by the ALSC until at least 14 days have passed. That span allows both the prosecution and defense time to submit requests for rehearings on ALSC’s opinion. Should either side do so, consideration of those requests by ALSC could add more time. 

“It’s really hard to say (how long it might take) — it’s such a case-by-case thing,” Mitchell said. “It could be anywhere from weeks to a couple of months before we get it.” 

It is also not uncommon for one side or the other to ask for an extension of time to file their requests for a rehearing, which would add additional time. 

However, once that certificate is sent out by the ALSC, it should trigger Walker to revoke the appeals bond. 

The Criminal Appeals Court will also have to review Hubbard’s case and issue a new decision that considers the ALSC’s opinion on the six reversed counts. That process is likely to take much longer.

“Again, a lot of factors play into that and it’s hard to determine how long any one case might take,” Mitchell said. “I’d say you’re looking at a few months at least.”  

It will only add to the extraordinary length of this case.

Hubbard was convicted in June 2016 on 12 felony counts for using his office for personal gain and directing public business to his clients. Court testimony and evidence revealed Hubbard was making more than $600,000 per year in “consulting” contracts, mostly for work in areas in which he held no prior work experience.  

Since his conviction, a team of attorneys working for him — and financed by his campaign funds and various other entities — have challenged every word of his conviction, accusing the prosecution of misdeeds and attacking the state’s ethics laws — which Hubbard helped write — as overly broad and vague. 

Those appeals have been successful in getting half of the charges knocked down. But because Hubbard’s prison sentence was tied to only a couple of the specific charges, those decisions will not lessen his jail time.

 

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