Suit alleges political contributions led to Maggio verdict reduction in nursing home case | Arkansas Blog

Tuesday, November 18, 2014

Suit alleges political contributions led to Maggio verdict reduction in nursing home case

Posted By on Tue, Nov 18, 2014 at 1:36 PM

click to enlarge THOMAS BUCHANAN: Lawyer probes connections in nursing home case.
  • THOMAS BUCHANAN: Lawyer probes connections in nursing home case.
A nursing home damage suit that grew to have huge political implications is now at the center of a civil lawsuit in Faulkner County that targets key figures in the controversy.

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 alleges that Baker, as an agent of Maggio, solicited campaign contributions from Morton that influenced Maggio's decision in the nursing home case. The legal theory is that you can file for civil damages when injured by commission of a felony. The lawsuit contends that abuse of public trust is a felony. That's defined here as soliciting, conferring or accepting a benefit for a public servant to act in another person's favor.

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.

Part of the case Buchanan will make includes that Maggio's campaign money was handled by Dawn Rivers, the woman who'd become his wife, so he had reason to know when Morton's money arrived. In theory, judicial candidates aren't aware of campaign donations, which are supposedly raised by an independent committee.

The suit also names five John Does as defendants as co-conspirators.

The suit said Baker, accompanied by an employee, Linda Leigh Flanagin, solicited Morton in May 2013 while the trial was underway. It was decided May 16. On June 27, Maggio announced for office. By then, Baker had contacted Little Rock political consultant Clint Reed about working on Maggio's campaign. On July 8, Maggio heard the request for a reduced judgment. That same day, Morton sent $21,000 to PACs that he knew would benefit Maggio. That same day, he sent $100,000 to UCA. The next day, July 9, Morton's checks arrived at Baker's home. On July 10, Maggio reduced the judgment by $4.2 million. On July 31, six PACs were registered by Chris Stewart as directed by Baker. He registered a seventh six days later. The lawsuit says they were formed to funnel money to Maggio. The suit notes that the money was solicited and set aside far in advance of when fund-raising for judicial races can begin — normally 180 days before an election. It also alleges that officers listed for the PACs were not informed they were being used as officers. Maggio withdrew as a candidate in March 2014 and was removed from the bench Sept. 11.

The suit seeks punitive as well as actual damages for the defendants' "reckless and callous indifference" to the law. It said Maggio had breached his fiduciary duty, including in campaign finance law compliance. It said, too, that plaintiffs had been denied constitutional rights by a conspiracy to unlawfully reduce the jury verdict.

Federal agents have examined the case surrounding the nursing home contributions and Maggio's ruling, but have made no public declarations. Morton has said he merely contributes to good political causes and did nothing wrong. Baker has avoided comment.

Morton spent huge sums in a number of political races this year, including providing a significant portion of the money raised by Rhonda Wood of Conway, a friend of Maggio and Baker, for an unopposed race for Arkansas Supreme Court, contributions to Faulkner circuit court candidates and almost $100,000 for the campaign of Leslie Rutledge, elected attorney general. The attorney general's office investigates Medicaid fraud in nursing homes.

Various sources say federal inquiries have included the gathering of phone and bank and courier service records, along with Grand Jury subpoenas. Rumors are rampant that some of those involved in the matter are cooperating with federal authorities.

The case was assigned to Faulkner's 5th division, a seat to which H.G. Foster was elected this year. He defeated a candidate, Doralee Chandler, who  had received contributions from Michael Morton, one of Morton's rare defeats this year.

Morton paid the $1 million reduced judgment. Buchanan didn't appeal. The time for appeal lapsed before  disclosures about campaign contributions were known. Buchanan said his decision might have been different had he known then what has since been disclosed.

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