Opening argument last month gave a bird’s eye view of what the prosecution plans to show in its criminal case. Now the government is laying out the hundreds of puzzle pieces from which they hope jurors will see the big picture.
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Last week, prosecutors used hundreds of exhibits in the criminal case against former Ohio House Speaker Larry Householder and lobbyist and former Ohio Republican Party leader Matthew Borges to show the movement of money and communications among dozens of people relating to the state’s largest corruption case ever.
The prosecution also showed political ads claiming that various opponents of “Team Householder” candidates were bending to the whim of special interests — without disclosing that special interests paid for the ads themselves.
Along with the dark money organization Generation Now and three other individuals, Householder and Borges were indicted in July 2020 for an alleged racketeering conspiracy involving $60 million funneled through multiple groups in order to pass and preserve a billion-dollar bailout for nuclear power plants previously owned by a FirstEnergy affiliate.
Other provisions in House Bill 6 allowed for guaranteed revenues for utilities, gutted Ohio’s clean energy standards, and subsidized two 1950s-era coal plants. The nuclear bailout and guaranteed revenues were nixed nearly a year after the arrests, but Ohioans continue to pay for the two old coal plants and have been left with the nation’s weakest clean energy program.
Assistant U.S. Attorney Emily Glatfelter’s opening argument painted a picture of co-conspirators using dark money groups to launder roughly $60 million in bribes to pass and protect Ohio’s nuclear bailout law. Householder, she argued, “sold the statehouse” at Ohioans’ expense.
Defense attorney Steven Bradley’s argument cast Householder as an active political campaigner who supported the goals of HB 6, but that “ordinary campaign contributions” didn’t add up to a bribe.
Lawyer Todd Long depicted Borges as someone distinct from other defendants. An alleged attempt to bribe a key player in the drive to let Ohio voters reject HB 6 was really just trying to steer some business to a friend, Long argued.
Since then, the government has had reams of documents admitted into evidence. FirstEnergy Treasurer Steven Staub set the stage for later statements by company officials when he testified that the company was “just bleeding cash” before the alleged conspiracy formed. FirstEnergy admitted in July 2021 that it had used nonprofit entities known as 501(c)(4) corporations to secure favorable treatment from the former House speaker, and that it had also paid millions to a company linked to former Public Utilities Commission Chair Sam Randazzo shortly before he took office.
Some recorded phone calls of deceased co-defendant Neil Clark were played, and more could be played as the trial progresses. Co-defendant and former FirstEnergy Solutions lobbyist Juan Cespedes, who pled guilty, is expected to take the stand this week. Co-defendant and former Generation Now President Jeff Longstreth, who also pled guilty, will most likely testify as well, along with others who played roles at that organization and elsewhere.
Some current and former lawmakers, including Ohio Attorney General David Yost, also have been subpoenaed in the case. Documents shown to the jury suggest Borges and Householder had communications with Yost about a voter referendum effort that might have blocked HB 6.
Following the money
The most detailed testimony so far came from FBI agent Blaine Wetzel, who testified for multiple days about evidence obtained through roughly 250 subpoenas. Responding to questions from Glatfelter, he used documents to show the flow of money from FirstEnergy and its affiliates to Partners for Progress, One Ohio United, or other entities, which then made its way directly or through other pass-through entities to Generation Now, Hardworking Ohioans, Hardworking Americans and other groups.
From there, the money went out to other entities, primarily for the purpose of supporting “Team Householder” candidates who were most likely to vote to make him speaker and to go along with HB 6. After HB 6 passed, more funding made its way to dark money groups to thwart the voter referendum.
Interspersed with the financial documents, Wetzel testified about materials showing communications relating to the alleged scheme. Timing suggested a cause-and-effect relationship between those communications and the transfers of money. The emails and texts also gave Wetzel an opportunity to explain who individuals were in the grand scheme of things.
The materials shed light on the relationship between Householder and others, including Longstreth, former FirstEnergy CEO Chuck Jones, former FirstEnergy Vice President Michael Dowling, and more. Communications between Jones and Dowling also reflected their conversations or texts with Householder and others.
Wetzel’s testimony looped Borges into the alleged enterprise as well, showing how he was brought in as a consultant for FirstEnergy Solutions and noting his communications with others about HB 6 and the referendum effort. Documents also showed the flow of money from Generation Now into a company set up by Borges days before the first payment of $400,000.
The government used Wetzel’s testimony as an opportunity to introduce evidence of how the dark money behind the alleged scheme likely influenced the outcome of elections. One ad attacked Householder’s 2018 primary opponent, Kevin Black, as being “bankrolled by outside dark money special interests.” Another ad targeting Black ironically admonished against “taking money raised by people who could end up in jail.”
Communications showed Householder providing input on the ad, even though it purported to be paid for by the “Hardworking Americans” PAC. Prosecutors might later argue that this is a violation of campaign finance rules, which limit corporate spending and require such groups to disclose donations. So-called independent organizations are also not supposed to coordinate their activities with candidates and their campaigns.
Householder’s election as speaker gave him control over committee assignments and some control over the legislative calendar.
Householder was not a primary sponsor of HB 6, but he took the lead in introducing the bill with sponsors and “Team Householder” members Jamie Callender and Shane Wilkin on April 12, 2019. Materials discussed by Wetzel showed Householder’s close communications with FirstEnergy on drafts of the legislation.
Legislators fast-tracked HB 6 through the House, passing it before the end of May. Wetzel’s testimony also dealt with Householder’s efforts to get lawmakers back to Columbus in July 2019 to make sure there were enough votes for final passage in the House.
If it seems complicated…
Parts of the testimony were definitely not the stuff of TV courtroom dramas. But the complexity is key to the government’s allegations that dark money groups were basically used to launder bribe money. Failure to connect all the pieces of the puzzle could give the defendants grounds to say the government didn’t prove its case beyond a reasonable doubt. That’s the burden of proof for a criminal case.
So far, government lawyers have made a point of asking Wetzel or others to tell the jurors or remind them who different players are. And closing arguments let lawyers go back and tell jurors how evidence admitted at trial supports the required factual elements of their case.
But there’s also a risk that the complexity could backfire. Defense lawyers will likely argue that the government’s puzzle pieces don’t add up to the big picture the prosecution claims.
Or, the defense may try to get jurors to focus on individual puzzle pieces that don’t, in themselves, show illegal intent. Taken alone, messages about campaign victory celebrations, offers of tickets to baseball All-Star events, and thanks for Householder’s leadership may seem innocuous, for example. Similarly, it’s ambiguous what Longstreth meant by some texts that just said “Boom!”
Testimony by additional witnesses could flesh out more details about the alleged conspiracy or clarify its actions and intent. Those persons might include one or more additional persons who currently or previously worked for FirstEnergy.
The current freeze on four FirstEnergy regulatory cases came about after the U.S. attorney’s office asked the Public Utilities Commission of Ohio to delay depositions, based on fears that they could interfere in an ongoing investigation. That request, which referred to the trial of Householder and Borges, came after the deposition of a former FirstEnergy ethics officer was interrupted.
U.S. District Court Judge Timothy Black set aside six weeks for the trial. It remains to be seen how well the rest of the government’s case will persuade jurors, as well as what holes both defendants’ lawyers may poke in the case.