Motion to Strike and Supplement to Motion In Limine and Incorporated Memorandum of Law
COMES NOW the Defendant, by and through his undersigned counsel, pursuant to Rules 12 (b) and 49(d) Fed. R. Crim. P., Rule 11, Fed. R. Civ. P., and the United States Constitution, and hereby respectfully files this Motion to Strike the government’s allegation in their Response (Doc. 227) to Defendant’s Motion to Dismiss (Doc. 221), alleging that the Defendant has filed a “phony document,” and further supplements its previously filed Motion In Limine – Counts 37-43, and in support hereof, states as follows:
A. “Phony” Document
1. In its effort to maintain its prosecution of the R. counts (Counts 37-43), the government has sought to denigrate the clear presentation made by the defense that the R. counts are unfounded. In part, the defense has done so by demonstrating that the “emergency dredging contract” alleged in the indictment, which is the centerpiece of their allegations, was not only never awarded by the JPA but, instead, an annual maintenance contract was awarded – for which no minority set aside requirement was ever utilized. Moreover, as is uncontested by the government, the P. A. never paid one dime for any alleged minority participation in the annual maintenance contract. Hence, the allegations in those counts are not supported by the proof, and the alleged mailings cannot be in furtherance of the scheme charged.
2. In support of the factual demonstration that the annual maintenance dredging contract did not require any minority participation, counsel attached as Exhibit D to the Motion to Dismiss (Doc. 221) a copy of the December 7 annual maintenance contract, along with Article V thereof, which is entitled “JSEB/MBE Participation Policy, Goals, Conditions and Instructions.” Page 5 thereof, at the top of the page, reveals that the JPA left completely blank the required percentage of JSEB/MBE participation and, in addition, the designated “JSEB/MBE Categories” were likewise left blank – further confirming that the annual maintenance contract had no minority participation requirement.
3. This document the government sadly and erroneously refers to as a “phony” document. Government’s Response (Doc. 227) at 19, 25 and 44. Indeed, the government’s sole argument asking the Court to deny Defendant’s Motion in Limine as to the R. counts is that the Defendant is “factually wrong” for using this alleged “phony document for his centerpiece.” Id. at 44.
4. It is most troubling and disconcerting, not only that the government would make such a scandalous allegation, but that they have such an incredible lack of comprehension of their own case.
5. Attached hereto as Exhibit A is a copy of Article V – of 12/7 Annual Maintenance Contract, which is an extract from Exhibit D to the Notice of Filing Exhibits (Doc. 223) to our Motion to Dismiss (Doc. 221). In addition, attached as Exhibit B is a copy of Government Exhibit 21 to their Response to that motion (Doc. 227-21). The government’s exhibit has a cover page that clearly demonstrates it is a composite of the “Contract Documents” for “JPA Contract No: C-1191” – the “maintenance dredging” contract which was awarded to SSI on December 7. Pages 15-20 of government Exhibit 21 is a duplicate of that same Article V to the contract, i.e., the JSEB Minority Participation Policy and Goal. A comparison of that government exhibit with the prior defense exhibit reveals they are identical – with the exception of the missing Bates stamp at the bottom.
6. It is a testament not only to the government’s overzealous desire to prosecute the R. counts that they would characterize a legitimate exhibit as a “phony,” but it is also a testament to their complete lack of comprehension of their own documents. It is unfathomable that the government, while accusing the defense of filing a “phony” document, would file the exact same Article V contract document as their own Exhibit 21. However, their willingness to do so is expressed in their own pleading. Absent their ability to urge that the defense has relied on a “phony document for its centerpiece,” the government cannot advance its claim that the defense’s assertions with regard to the spurious nature of the R. counts are “factually wrong.” Government Response (Doc. 227) at 44.
B. L. N. Confirmation
7. As the Court will recall, the defense has previously filed an affidavit from retired FBI investigator G. W., confirming that the emergency dredging contract charged in the R. counts was never awarded, and the annual maintenance contract had no minority requirement, and paid no minority fees – during its entire life. (Ex. O to Doc. 223). Moreover, in further support of that correct factual report, an e-mail from L. N., the Director of Procurement Services for the JPA, was also filed. (Ex. P to Doc. 223). However, in footnote 33 at page 26 of their response (Doc. 227), the government states it has “confirmed with … Mr. N. … that its understanding of the contract is true.” The “contract” referenced in that footnote is identified by the government as “Contract C-1191.” Id. at 26, line 3. Three essential and dispositive observations flow from that government claim.
8. First, even if that were true, the government wholly fails to recognize that the C-1191 annual maintenance contract was not charged in the indictment. The indictment alleges only the “2005 emergency dredging contract.” Indictment at 25 at C.1., C.2. and C.3, and 26 at C.5. and C.7. The government cannot allege fraud on an emergency dredging contract and then seek to prove fraud on the completely separate annual maintenance contract. Such a roaming theory of prosecution would clearly defeat the client’s right to due process.
9. Second, given the fact that the government’s “phony” document claim is pure fiction, it is clear that Mr. N.’s opinion would remain the same – since the government itself acknowledges that the very document upon which the defense relies is one of the “Contract Documents” for the annual maintenance contract – “Contract No.: C-1191.” See government’s Exhibit 21 at Doc. 227-21, at pages 1 and 15-20, and especially page 19.
10. Third, the defense has conferred with Mr. N. to determine if in fact the government has “confirmed” with him their “understanding of the contract.” He has advised us that he did speak with the government in January, and confirmed for them that the C-1168A contract was never awarded, and that no minority funds were expended by the Port on C-1191.
11. Again, it is a testament to the government’s zeal to force the R. counts into court that they would misrepresent to the Court such an important matter. Mr. N. is the expert at the Port with regard to the knowledge of these contracts. The government’s speculation to the contrary is simply that – speculation.
C. Subcontractors – No Conflict of Interest
12. The government’s theory in the R. counts (Counts 37-43) is that the client defrauded the Port by “exploiting a 20% JSEB/MBE participation goal in a 2005 solicitation for bids by JP seeking emergency dredging services.” Indictment 25, ¶C.1. Of course, this is the emergency dredging contract – C-1168A. Clearly, the government is not alleging that the client created any 20% requirement – but only that he was “exploiting” it. We must then look to their theory of exploitation to determine if they have properly alleged a crime. The government’s theory of exploitation is that the client assisted SSI in the bidding process by providing them with the name of a certified JSEB/MBE participant, R. C., who “would act as a subcontractor under SSI’s bid.”
13. The question then becomes whether or not a sitting board member can defraud the board by assisting a general contractor in identifying and/or utilizing a subcontractor. The answer to that is a resounding no. Although the government uses the pejorative term “exploiting,” in reality, the bid process was one in which SSI simply sought to comply with the confusing bid requirements. The government has taken what is no more than a standard implementation of potential contractual requirements and sought to criminalize a bid that did nothing more than seek to comply with those requirements.
14. More importantly, the government seeks to characterize as fraud the conduct of a board member in assisting the general contractor with the selection of a subcontractor, when his conduct in doing so was perfectly ethical.
15. In light of the government’s disappointing and incorrect aspersions in their Response to Defendant’s Motion to Dismiss (Doc. 227), counsel has further researched the fundamental theory of their prosecution on these R. counts. That research has led to dispositive opinions rendered by the Florida Commission on Ethics. Attached hereto as Exhibits C and D are two opinions, that is Florida Commission on Ethics (1) Opinion CEO 88-43 and (2) Opinion CEO 07-2. Those opinions clearly demonstrate that a sitting board member can actually act as the subcontractor to a general contractor who is contracting to provide goods or services to the board – without transgressing into the conflict of interest provisions of the Florida ethics statutes. Thus, a fortiori, the client was beyond reproach in assisting SSI with the identification and submission of a name of a potential minority subcontractor, while SSI was bidding on the emergency dredging contract.
16. In Florida Commission on Ethics Opinion CEO 88-43 (Exhibit C), the Commission reviewed a matter involving a board member of a water management district. The district had decided to expand its headquarters building and had solicited proposals for the design and construction of new facilities. One of the general contractors who submitted a proposal sought to use the board member as a subcontractor to do the necessary paving work. The Florida Commission on Ethics held, consistent with what they note to be “several previous opinions,” that the board member was free to act as a subcontractor – even though the board member had actually sat on the building committee that developed the specifications for the addition, and even though the bidding procedure was not a competitive one. The Commission determined that a board member (or any public official) was not prohibited from “subcontracting to provide goods or services to a contractor doing business with his agency.” Opinion at 2.
17. This consistent holding of the Commission was reiterated in their Opinion CEO 07-2 (Exhibit D). In that case, a board member of the Jacksonville International Airport Community Redevelopment Agency was the president of a transportation planning corporation that was to be a sub-consultant to the prime consultant.
18. The upshot of these Commission decisions confirms that the client could even have had his own company acting as a subcontractor to SSI – without having transgressed any of the ethical statues or rules applicable to such board members. Instead of actually examining the ethical boundaries of a board member, the government has concocted a theory of criminality that seeks to criminalize the conduct of a volunteer, non-paid, part-time board member from assisting a general contractor in bidding on a contract. Apart and aside from the fact that that emergency dredging contract was never let, as can be seen, the government’s entire theory of prosecution is specious. If it is not illegal or unethical for a board member to be a subcontractor for the general contractor, a fortiori, the government has failed to state a viable prosecution theory with regard to a board member that does nothing more than assist the general contractor in identifying a qualified subcontractor.
WHEREFORE, it is respectfully requested that this Motion to Strike be granted and the Court grant this Motion in Limine to prohibit introduction of evidence in support of the alleged R. counts.