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Criminalizing Politics? Or Reading a Complaint?

The cries that Fitz is criminalizing politics are getting almost as shrill as the insinuations that Obama must be hiding something because he agreed to hold off on releasing the summary of communications with Blago’s folks. There’s the NYT, relying on "some lawyers" that just happen to be just two lawyers that have scrapped with Fitz in the past (Bob Bennett, who represented Judy, and Michael Monico, who represented one of Blago’s fundraisers).

But now some lawyers are beginning to suggest that the juiciest part of the case against Mr. Blagojevich, the part involving the Senate seat, may be less than airtight. There is no evidence, at least none that has been disclosed, that the governor actually received anything of value — and the Senate appointment has yet to be made.

And then there’s that legendary dealmaker, Willie Brown.

But if his bargaining over the Senate seat was for political gain, not financial benefit, then he ought to hold tight.

That said, I can’t help but take stories like this personally. Any politician’s downfall reflects on every other politician. It demeans your history, your record. People look at you and figure, yeah, you just didn’t get caught.

Yet these cries rely on two things: an exclusive focus on the Senate seat allegations at the expense of the other allegations, and a neglect of the actual details of the complaint  (to be fair, the NYT’s Johnston admits he’s focusing on just the "juiciest part" of the complaint, though even there, he doesn’t consider how that "juiciest part" plays into the two charges in the complaint). 

So here’s what the actual complaint says, to a non-lawyer.

First, there are two charges. Neither relies entirely on the Senate seat part of the complaint. I’ll deal with the charges in reverse order.

Charge Two: The Wrigley Field Deal

The second charge, which relies entirely on the Wrigley Field part of the complaint, charges:

Beginning no later than November 2008 to the present, in Cook County, in the Northern District of Illinois, defendants ROD R. BLAGOJEVICH and JOHN HARRIS, being agents of the State of Illinois, a State government which during a one-year period, beginning January 1, 2008 and continuing to the present, received federal benefits in excess of $10,000, corruptly solicited and demanded a thing of value, namely, the firing of certain Chicago Tribune editorial members responsible for widely-circulated editorials critical of ROD R. BLAGOJEVICH, intending to be influenced and rewarded in connection with business and transactions of the State of Illinois involving a thing of value of $5,000 or more, namely, the provision of millions of dollars in financial assistance by the State of Illinois, including through the Illinois Finance Authority, an agency of the State of Illinois, to the Tribune Company involving the Wrigley Field baseball stadium; in violation of Title 18, United States Code, Sections 666(a)(1)(B) and 2.

In English: Blago and Harris, who were agents of an entity (the State of Illinois) that gets more than $10,000 from the federal government and also agents of an entity (the Illinois Finance Authority) that gets $5000 from the state of Illinois, used their position to demand a thing of value (the firing of Trib editors) in exchange for another thing of value (financial support for Wrigley Field).

Fitz goes to some length to prove the whole "agent" thing–I’ll spare you that bit, because it’s boring.

What this charge comes down to, though, are two details. First, Blago knew he was exchanging something of value, because he and Harris discussed the value at some length.

In apparent reference to the prospect of IFA assistance for the Wrigley Field deal, ROD BLAGOJEVICH then asked, “what does this mean to them? Like $500 million? What does it mean to [Tribune Owner] in real terms?” HARRIS replied, “To them? About $100 million . . .maybe 150.” ROD BLAGOJEVICH said that he thought “it was worth like $500 million to ‘em.” ROD BLAGOJEVICH and HARRIS then discussed the details of the deal the Cubs are trying to get through the IFA. HARRIS said that it is basically a tax mitigation scheme where the IFA will “own title to the building” (believed to be Wrigley Field), and the Tribune will not “have to pay capital gains tax.” HARRIS explained that the total gain to the Tribune is in the neighborhood of $100 million. ROD BLAGOJEVICH said, “$100 million is nothing to sneeze at. That’s still worth something, isn’t it?”

And, believing he had struck a deal, Blago took action to fulfill his half of the deal.

After hearing that Tribune Financial Advisor had assured HARRIS that the Tribune would be downsizing or making personnel changes affecting the editorial board, ROD BLAGOJEVICH had a series of conversations with representatives of the Chicago Cubs regarding efforts to provide state financing for Wrigley Field. On November 30, 2008, ROD BLAGOJEVICH spoke with Sports Consultant, the president of a Chicago-area sports consulting firm, whose remarks during the conversation indicated that he was working with the Cubs on matters involving Wrigley Field. In that conversation, ROD BLAGOJEVICH and Sports Consultant discussed the importance of getting the IFA transaction approved at the IFA’s December 2008 or January 2009 meeting, because ROD BLAGOJEVICH was contemplating leaving office in early January 2009 and ROD BLAGOJEVICH’s IFA appointees would still be in place to approve the IFA deal. On December 3, 2008, ROD BLAGOJEVICH spoke again with Sports Consultant and explained that ROD BLAGOJEVICH had control over state funds designated for use in connection with science and technology, and which could be used to pay for improvements at Wrigley Field. Later that same day, ROD BLAGOJEVICH spoke with Cubs Chairman and said that he could make state science and technology funds available to the Cubs without having to go through the legislature, and suggested that the Cubs come up with proposals that would allow the use of such funds.

Now, there’s a lot here that Fitz doesn’t give us. For example, does he have any record of the conversations between Harris and Nils Larsen, the Tribune financial advisor, which would make this quid pro quo clear? Does Fitz have any proof that the Trib folks tried to keep their end of the bargain? Given that Fitz has spoken with Larsen and subpoenaed the Trib since the arrest, he probably doesn’t (or didn’t, when he wrote the complaint) have all the details from the Trib’s side. And does Fitz have clear evidence that the second action above–use of the sciences and technology funds for Wrigley Field–was connected to his efforts to get editors at the Trib fired? 

But the critical question, really, is whether Fitz can prove that 1) Blago did have reason to believe the Trib was going to deliver it’s side of the bargain, and 2) whether Blago made it clear that his intercession with the IFA was completely contingent on his belief that he was getting something of value–the firing of Trib editors–in return? Note that while Fitz gives us the transcripts of conversations that prove some of this, he doesn’t give us all of these conversations.

Charge One

The first charge–which is more nebulous–is where the Senate seat comes in. But the charge also references Blago’s actions in the Wrigley Field deal and the pay-to-play scandal, in which he required campaign donations before he would take certain actions as governor. This is the honest services charge that people complain is too vague.

From in or about 2002 to the present, in Cook County, in the Northern District of Illinois, defendants did, conspire with each other and with others to devise and participate in a scheme to defraud the State of Illinois and the people of the State of Illinois of the honest services of ROD R. BLAGOJEVICH and JOHN HARRIS, in furtherance of which the mails and interstate wire communications would be used, in violation of Title 18, United States Code, Sections 1341,1343, and 1346; all in violation of Title 18 United States Code, Section 1349.

By mentioning 1349, Fitz is relying on the following:

Any person who attempts or conspires to commit any offense under this chapter shall be subject to the same penalties as those prescribed for the offense, the commission of which was the object of the attempt or conspiracy. 

That is, to prove Blago guilty of this crime, Fitz only has to prove that Blago attempted to defraud the people of Illinois of his honest services, not that he succeeded in doing so. The definition of honest services relies on some IL laws that describe what a public figure should and shouldn’t do. Here’s just a taste:

Pursuant to the criminal laws of the State of Illinois (720 ILCS 5/33-1(d)), ROD BLAGOJEVICH is prohibited from receiving, retaining, or agreeing to accept any
property or personal advantage which he is not authorized by law to accept, knowing that such property or personal advantage was promised or tendered with intent to cause him to influence the performance of any act related to the employment or function of his public office.

Again, I’m not a lawyer, but this is what this says to me. 1) Blago is prohibited from doing certain things because he’s a public figure, including taking property that he knows was given to him in order to influence his decisions as Governor, and 2) if he even attempts to do that–to take money or something else of personal value to influence his decision-making–whether or not he succeeds, then he has committed honest services fraud. 

I’ll let the lawyers argue over whether that is too flimsy a basis on which to charge. But I do want to correct some impressions on the part of Dave Johnston and Willie Brown  that Blago never attempted to get something of personal value.

The Children’s Hospital

First, given that this charge also relies on the pay-to-play scam, Johnston and Brown ought to be considering the children’s hospital as much as the Senate seat (that is, Johnston’s "juiciest part" doesn’t exist independent of this more mundane alleged corruption). That part of the complaint, incidentally, depends on the testimony of a cooperating witness (I think this is John Wyma).

According to Individual A, on October 8, 2008, during a discussion of fundraising from various individuals and entities, the discussion turned to Children’s Memorial Hospital, and ROD BLAGOJEVICH told Individual A words to the effect of “I’m going to do $8 million for them. I want to get [Hospital Executive 1] for 50.” Individual A understood this to be a reference to a desire to obtain a $50,000 campaign contribution from Hospital Executive 1, the Chief Executive Officer of Children’s Memorial Hospital. Individual A said that he/she understood ROD BLAGOJEVICH’s reference to $8 million to relate to his recent commitment to obtain for Children’s Memorial Hospital $8 million in state funds through some type of pediatric care reimbursement.

After Hospital Executive 1 refused to return Blago’s fundraiser’s calls, Blago started taking steps to withdraw the $8 million allocated to the hospital.

ROD BLAGOJEVICH: The pediatric doctors – the reimbursement. Has that gone out yet, or is that still on hold?”
DEPUTY GOVERNOR A: The rate increase?
DEPUTY GOVERNOR A: It’s January 1.
ROD BLAGOJEVICH: And we have total discretion over it?
ROD BLAGOJEVICH: We could pull it back if we needed to – budgetary concerns – right?
DEPUTY GOVERNOR A: We sure could. Yep.
ROD BLAGOJEVICH: Ok. That’s good to know.

In other words, Blago prepares the groundwork for withdrawing state funding from the hospital because he didn’t get a $50,000 contribution from the hospital’s CEO. Fitz ends his narrative on the hospital just a day after he ends his narrative on the contacts with Obama’s team (November 14 in the case of the hospital), so he is not revealing a number of the discussions that happened since. Though he made it clear at his press conference that Blago still hasn’t signed that order.

One of Blago’s Deputy Governors resigned the day following the arrest and Fitz executed a search warrant on a Deputy Governor’s office the day of the arrest, so again, he may well be collecting ongoing information on this. But Wyma’s testimony and these intercepts provide a good deal of evidence that Blago was making the decision on the hospital entirely on whether or not get got his campaign cash. 

Also note: the children’s hospital deal (and the other campaign finance schemes) are the parts of the investigation that may have been most badly affected by the Trib’s scoop on December 5 that Blago had been wiretapped. That’s because the story also revealed the cooperation of John Wyma, who first described this scheme to investigators, and who is a key witness to these activities. 

The Senate Seat

Which, finally, brings us to the senate seat. There are two details worth looking at closely. First, a number of people said that Blago never made a clear quid pro quo offer to anyone regarding the senate seat–the suggestion being that Blago never got beyond the hypothetical stage. But that’s why Fitz mentioned the SEIU deal during his press conference. After laying out Blago’s discussions of how he could get something of value in exchange for the seat–including a 501c4–Fitz describes this conversation (which, because it was a phone call to Washington, handily involves interstate wires):

On November 12, 2008, ROD BLAGOJEVICH spoke with SEIU Official, who was in Washington, D.C. Prior intercepted phone conversations indicate that approximately a week before this call, ROD BLAGOJEVICH met with SEIU Official to discuss the vacant Senate seat, and ROD BLAGOJEVICH understood that SEIU Official was an emissary to discuss Senate Candidate 1’s interest in the Senate seat. During the conversation with SEIU Official on November 12, 2008, ROD BLAGOJEVICH informed SEIU Official that he had heard the President-elect wanted persons other than Senate Candidate 1 to be considered for the Senate seat. SEIU Official stated that he would find out if Senate Candidate 1 wanted SEIU Official to keep pushing her for Senator with ROD BLAGOJEVICH. ROD
BLAGOJEVICH said that “one thing I’d be interested in” is a 501(c)(4) organization. ROD BLAGOJEVICH explained the 501(c)(4) idea to SEIU Official and said that the 501(c)(4) could help “our new Senator [Senate Candidate 1].” SEIU Official agreed to “put that flag up and see where it goes.”

On November 12, 2008, ROD BLAGOJEVICH talked with Advisor B. ROD BLAGOJEVICH told Advisor B that he told SEIU Official, “I said go back to [Senate Candidate 1], and, and say hey, look, if you still want to be a Senator don’t rule this out and then broach the idea of this 501(c)(4) with her.”

Fitz has Blago discussing the Senate seat in terms of a longterm job for himself–notably, with Blago’s description of using the 501c4 as a means to hide the quid pro quo–both before and after he made the offer to the SEIU Officer. Blago’s attempt to get this quid pro quo didn’t have to be successful, he just has to have attempted it. Note, we know the SEIU has spoken with Fitz either before or after he made this arrest, so this is another area where he likely has more evidence than he has let on.

And then, finally, we get to Candidate 5, the alleged attempt by JJJ’s fundraisers to give Blago $1.5 million in exchange for the seat for JJJ. Fitz actually gave us very little detail on this scheme–noting only that Blago says someone approached him on October 31 and then noting that Blago was discussing approaching these people again the week before he was arrested. The Trib matched up the likely people involved in this scheme–matching both an October 31 conversation and, more significantly, a December 6 fundraiser which some attendees associated with JJJ’s senate bid. Significantly, the Trib revealed that one of the attendees at the fundraiser was already under scrutiny.

[Harish] Bhatt, whose two Basinger’s Pharmacy outlets were searched by the FBI last week, has been the focus of a state and federal investigations into whether campaign donations were made in exchange for regulatory favors.

Bhatt is a prominent Indian businessman who helped the state’s top pharmacy regulator win his job. The Tribune reported last year that state pharmacy auditors probing allegations of Medicaid fraud at Basinger’s complained that their bosses thwarted the investigation, allegations Bhatt has adamantly denied in interviews with the Tribune.

Now, this is the "juiciest" allegation in the complaint. But as I said, Fitz doesn’t give us all the details on it, providing just two data points.

But that’s largely timing!

He doesn’t include details of the fundraiser, which basically occurred as the complaint was being submitted. More importantly, he couldn’t have described what went on at the meeting between Blago and JJJ–just hours before Blago was arrested–because the complaint was approved on December 7 and the Blago-JJJ meeting took place on December 8. JJJ has said that he was not offered the senate seat at the meeting, but he did not say anymore about Blago’s side of the conversation, leaving open the possibility that Blago made a clear quid pro quo offer at the meeting, one that we wouldn’t know about.

In other words, everyone is complaining that Fitz hasn’t proven this, the juiciest part of the complaint, while they ignore the rest of the evidence in the complaint. But they don’t recognize that this juicy bit is something for which the proof would have happened after the drafting of the complaint–but just hours before, Fitz said, the FBI arrested Blago to stop Blago mid-crime spree. We don’t know whether Fitz got more evidence between December 7 and December 9 when the FBI made the arrest; but there are certainly reasons to believe that he did. 

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