Sunday, May 09, 2010

Blumenthal And The Gentle Art Of Selective Prosecution

"Here we are 90 days later, and Dick Blumenthal has issued 64 press releases but still no answer on Susan Bysiewicz's intelligence files. Three months is more than enough time to find out whether Bysiewicz illegally used state resources for political purposes. … He's got 200 lawyers over there, and he can't get to the bottom of this very serious allegation?"
So said Republican Party Chairman Chris Healy concerning Attorney General Richard Blumenthal’s slow boil investigation of Secretary of State Susan Bysiewicz.

When it was revealed that Bysiewicz may have lacked the requisite experience to run for Blumenthal’s position as attorney general, the attorney general punted the problem to the Superior Court Judge Michael Sheldon, who promised – and delivered -- an expedited decision.

The question concerning possible misuse of a data base assembled by Bysiewicz’s office arose at the same time. The problematic data base containing 36,000 names, the existence of which became known in February, included persons who had contacted the secretary of state’s office on matters of business. Appended to the names were notes that, some believe, would undoubtedly prove useful to Bysiewicz in her campaigns. The notorious list, for instance, included 2,500 people who in the past had been selected as Democratic nominating convention delegates. Bysiewicz’s campaign committee in 2009 had obtained a copy of the database through a legal Freedom of Information Act request.

"She worked on his [Blumenthal’s] campaign,” Healy pointed out. “They're fellow Democrats, fellow constitutional officers and fellow statewide office-seekers. He hasn't said anything about the progress of that investigation. Has she been interviewed? Have any files been examined? What's the timeline for action?"

Indicating the case involves possible potential violations of Health Insurance Portability and Accountability Act provisions as well as charges that Bysiewicz may have used her office to accommodate her campaign needs, an exasperated Healy said, “If it was a Republican secretary of the state, they'd be boiling a 50-gallon drum of oil right now."

Blumenthal promised a thorough, presumably non-expedited, investigation that very likely will run well beyond the upcoming Democratic nomination convention on May 12-22.

In the matter of timely investigations and prosecutions, Mr. Blumenthal is an artist of rare accomplishments. A recent Waterbury Republican American editorial noted that Blumenthal’s office had backlog of an astonishing 36,495 cases pending at the end of 2008-09, a 40 percent increase over 1995-96:

"For two decades, Connecticut has exported jobs and imported social-service clients because its business and regulatory climate, as personified by Mr. Blumenthal, has been so hostile. That reality is omnipresent, even in his own annual reports. His most recent one shows his office had 36,495 cases pending at the end of 2008-09, a 40 percent increase over 1995-96."

And, of course, one of the joys of the office is that the attorney general decides who he will investigate and when the subsequent prosecution will end.

Blumenthal is an old hand in selective prosecution.

In what Blumenthal described as a “virtually unprecedented” action, the attorney general and State Treasurer Denise Nappier sued investment firm Forstmann Little in Feb., 2002 for losing more than $125 million in state worker pension funds. What made the case unprecedented was that seven of Forstmann Little’s general partners – with one notable exception -- were separately named as individual defendants. The sloppy seven were thus put personally on the hook for any resulting liability for making lousy investments that tanked.

The missing exception, according to Joel Mowbray, writing in National Review at the time, was Erskine Bowles, “the multimillionaire former chief of staff for Bill Clinton and current Democratic candidate for the U.S. Senate seat now held by the retiring Sen. Jesse Helms (R., N.C.)”

Blumenthal’s suit was well founded, since Connecticut had stipulated that it did not intend its investment to be involved in high risk ventures, but the exclusion of Bowles was highly irregular:

“Connecticut alleges a bait-and-switch: that it signed on for the old, stodgy strategy, but that it got the new, risky plan without its knowledge or permission. Connecticut's suit primarily charges that Forstmann Little and its partners violated the investment contract and significantly misrepresented the worth and type of investments made in XO and McLeod… Given his [Bowles'] status as a general partner during most of the relevant time covered by the Connecticut lawsuit — he arrived in January 1999, and departed in October 2001 — Bowles' exclusion from the list of named defendants is curious, to say the least. He joined Forstmann Little eight months before the McLeod investment, and was a partner for almost the entire XO disaster, exiting only one month before Connecticut's stake in XO was completely wiped out…”

“State treasurer Denise Nappier has said that Bowles was on the original list of defendants, but his name was dropped by the outside counsel working with her office because of a lack of direct involvement in wrongdoing. But Bowles clearly had more involvement in McLeod than the five partners who are named defendants, but did not sit on the telecom's board of directors. And named defendants Klinsky and Holmes were not even partners when the investments were made, yet Bowles was.

“His luck, of course, is pure politics. Neither Klinsky nor Holmes had the good sense to run for statewide office as Democrats this year. They have both been dragged into the lawsuit, despite having far less involvement in the ill-fated investments than Bowles. Who needs Lady Luck when you have fellow Democrats calling the shots?”
Unlike Caesars wife, the highly partisan Blumenthal is not, in matters of political opportunism, above suspicion.

Oddly, the selective prosecution in the Forstmann Little case was raised as a campaign issue in 2002 by then Republican Party candidate for attorney general Martha Dean, a Republican presently running for the same office but, as sometimes happens in campaigns, Blumenthal managed to survive the issue.

So did Erskine Bowles, appointed in 2010 to co-chair President Barack Obama's fiscal commission with Alan K. Simpson.

Democrats, especially in Connecticut, have a way of overcoming such calamities.


Anonymous said...

36,495 open cases, my gosh. Don, do you know how that compares to other states?

Don Pesci said...


No, I don't. It’s a good question. I suppose CT would have to be compared with another state of comparable size and business activity. I do know that he ought to liquidate that backlog before he accepts any other cases. In total, the cases represent the cow swallowed by the boa constrictor judicial system -- a massive clog, part of Blumenthal's legacy to his successor. I doubt he even has a plan to settle those cases, and the old saying around the courthouse is: justice delayed is justice denied.

Don Pesci said...

Lockhart has something up on GAAP here: