Friday, January 9, 2015

Mike Maggio pleads guilty to federal bribery charge

Posted By and on Fri, Jan 9, 2015 at 1:34 PM

click to enlarge FALL FROM GRACE: Mike Maggio pleads guilty to federal bribery charges.
  • FALL FROM GRACE: Mike Maggio pleads guilty to federal bribery charges.
Former Circuit Judge Mike Maggio of Conway pleaded guilty to federal bribery charges on Friday in U.S. District Court. The offense carries a maximum penalty of 10 years in prison and a $250,000 fine.

It was a negotiated plea. It means he'll cooperate with the government, which was silent in its news release about plans for any future indictments. His cooperation could reduce his potential sentence to the range of three years, though the federal judge will ultimately make the call. A felony conviction will cost Maggio his law license.


Maggio had already been reprimanded by the Judicial Discipline and Disability Commission, which barred him from ever serving as a judge again. And he was the target of a civil suit over the same matter that led to today's plea on federal criminal charges; Max laid out the details succinctly in November:

Thomas Buchanan, a Little Rock attorney, has sued former Circuit Judge Mike Maggio of Conway, nursing home owner Michael Morton of Fort Smith and former Republican Sen. Gilbert Baker of Conway, a middleman on political contributions from Morton to Maggio and other judicial and legislative candidates.

The suit was filed on behalf of the family and representatives of Martha Bull, who died in the Greenbrier Care Center owned by Morton after the staff failed to act on a doctor's order that she needed hospitalization. Buchanan won a unanimous $5.2 million jury verdict for the family in Maggio's court. Maggio later decided the verdict "shocked the conscience" and reduced it to $1 million. This occurred about the time Morton was contributing money to political action committees set up by a Little Rock lawyer with Baker's guidance. The PACs contributed money to Maggio's campaign for state Court of Appeals. Blue Hog Report's later disclosure of the suspicious timing of contributions, along with Maggio's injudicious comments on an LSU fan website, forced his resignation from office and, ultimately, his permanent removal from the bench by the Arkansas Supreme Court.

In a newspaper interview with Debra Hale-Shelton of the Arkansas Democrat-Gazette, Morton has said he knew the multiple PAC donations he made were headed to Maggio. But he has disavowed any quid pro quo. Morton also contributed $100,000 to the University of Central Arkansas, where Gilbert Baker then worked as an assistant to President Tom Courtway. That money has been refunded.

click to enlarge MICHAEL MORTON: His nursing home benefitted from Maggio ruling.
  • MICHAEL MORTON: His nursing home benefitted from Maggio ruling.
The court documents filed Friday reference two other parties, "Individual A" and "Individual B." The documents say Maggio, "did knowingly and corruptly solicit and demand for his own benefit and the benefit of others, and accept and agree to accept, a thing of value from Individual A — that is, campaign contributions — provided through an intermediary, that is, Individual B..."

Individual A seems to be Morton, a stockholder in many nursing homes; Individual B is likely Baker,  a lobbyist and campaign fund-raiser as described in the information.

We'll update this post soon with more details. In the meantime, here's Maggio's plea:

mm_plea.pdf

And here's information from the U.S. Attorney prosecuting the case:

mm_docs.pdf
click to enlarge GILBERT BAKER: Campaign finance bundler helped raise money for judges.
  • GILBERT BAKER: Campaign finance bundler helped raise money for judges.
Here's the key narrative from the U.S. attorney:

… Individual B and others asked MAGGIO to consider running as a candidate for the Arkansas Court of Appeals. In or about May 2013, MAGGIO and Individual B met with others to discuss MAGGIO’s campaign for the Court of Appeals. During the meeting, MAGGIO was told that he would need to raise more than $100,000 to run a successful campaign. Individual B told MAGGIO that MAGGIO would be responsible for smaller donations from friends and family, totaling approximately $25,000 to $50,000, and Individual B would be responsible for covering the difference by raising funds from industry types” including, among other entities, nursing homes. On or about May 16, 2013, at approximately 10:33 a.m., Individual B sent MAGGIO a text message stating, “I have a LR lunch today with the nursing home folks. The topic will be judicial races. You are at the top of the list.” [Emphasis added.]

[Michael Morton ultimately contributed tens of thousands of dollars to multiple judicial candidates, heavily concentrated in Baker's home of Faulkner County. He provided major financing to, among others, Rhonda Wood of Conway, elected to a seat on the Arkansas Supreme Court.]

On or about June 27, 2013, MAGGIO formally announced his candidacy for the Arkansas Court of Appeals for the nonpartisan general election to be held on May 20, 2014. On or about June 29, 2013, at approximately 8:15 a.m., Individual B sent MAGGIO a text message stating in part, “Well your first 50k is on the way.” MAGGIO understood that this $50,000 included financial support from Individual A.

Between on or about June 29, 2013 and or about July 8, 2013, Individual B communicated to MAGGIO, stating in essence, “Win, lose, or draw, you have Individual A’s support,” referring to MAGGIOs decision on the motion for new trial or remittitur. MAGGIO understood that the purpose of this message was not to reassure MAGGIO that he had Individual A’s support regardless of any decision on the remittitur, but rather Individual B was reminding MAGGIO to make a favorable ruling to Individual A and Company A because of Individual A’s financial support of MAGGIOs campaign. At another time, Individual B reminded MAGGIO that he would receive campaign financial support if he made the tough calls” while on the bench.

MAGGIO understood that Individual B was advising MAGGIO that, in exchange for MAGGIO’s ruling in favor of Individual A and Company A, Individual A would provide campaign donations to MAGGIO.

On or about July 8, 2013, during the early afternoon, MAGGIO held a hearing on Company A’s pending post-verdict motions, including the motion for remittitur. On or about July 10, 2013, MAGGIO signed an order denying Company A’s motion for a new trial, but granting Company A’s motion for remittitur. MAGGIO reduced the judgment against Company A from $5.2 million to $1 million.

We are seeking comments from Baker and Morton and their representatives. The development is explosive. Baker bundled money for many candidates, including in Stacy Hurst's race for state representative. She got early money from Morton-financed PAC and refunded it when the scandal broke, but then Morton came in with $8,000 late dollars for her losing campaign in the last 10 days of the race. Morton gave large sums to Rhonda Wood, Robin Wynne and Karen Baker, all now sitting on the Supreme Court; to Maggio for the Court of Appeals; and to at least three candidates for circuit judge in Faulkner County.

The corrosiveness of special interest spending in judicial races has never been more apparent than in Maggio's appearance today in federal court.

Here's the U.S. attorney release on the case, with a good narrative of events.
The first story about Maggio's verdict reduction appeared on the Arkansas Blog July 11.  Blue Hog Report set fire to the Maggio story with reports about his web commentary and, more importantly, the convergence of legal events with curious campaign finance activity.  The Democrat-Gazette has reported extensively on Maggio's case and Morton's effort to influence political races with cash, always, he has said, in the interest of quality candidates, not in return for favors.

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