The Honolulu Star-Advertiser ran a story on Tuesday which gave prominent coverage to a legal filing in support of a motion to dismiss the federal conspiracy charge against former Honolulu Managing Director Roy Amemiya (“Dispute at core of Honolulu corruption case, lawyers argue“).
The story quotes the court filing by Amemiya’s defense attorney Lyle Hosoda, pointing out Amemiya is not an attorney, and had “absolutely no involvement” in negotiating the severance agreement for former Honolulu Police Chief Louis Kealoha, which is at the heart of the federal charges against Amemiya, former Corporation Counsel Donna Leong, and former Police Commission Chairman Max Sword.
Much of the public attention on this case has focused on the positive reputations of the defendants, often portrayed in glowing terms. I haven’t been following this case as closely as I perhaps should of, and so was interested in the argument being laid out in defense of Amemiya, which was submmitted by attorney Lyle S. Hosoda.
Hosoda cited a U.S. Supreme Court case, Kelly v. United States, that stated the criminal statutes Amemiya, Leong and Sword are accused of conspiring to violate are federal property fraud offenses. That requirement prevents the statutes from being used to criminalize every act of dishonesty by state and local officials and restricts federal prosecutors from setting “standards of disclosure or good government,” according to the filing.”
Hosoda’s memo seemed to be saying the Kelly v. US decision stands for the proposition that the kinds of internal shenanigans described in the indictment are properly beyond the reach of federal criminal charges. Interesting. So I quickly looked up the Kelly case, and then turned to the Supreme Court’s decision.
Here’s the concise summary of the circumstances of the Kelly case, excerpted from the opinion.
For four days in September 2013, traffic ground to a halt in Fort Lee, New Jersey. The cause was an unannounced realignment of 12 toll lanes leading to the George Washington Bridge, an entryway into Manhattan administered by the Port Authority of New York and New Jersey. For decades, three of those access lanes had been reserved during morning rush hour for commuters coming from the streets of Fort Lee. But on these four days—with predictable consequences—only a single lane was set aside. The public officials who ordered that change claimed they were reducing the number of dedicated lanes to conduct a traffic study. In fact, they did so for a political reason—to punish the mayor of Fort Lee for refusing to support the New Jersey Governor’s reelection bid.
I was surprised that an initial reading of the decision does not appear to support Hosoda’s spin.
From the introduction to the decision: “The question presented is whether the defendants committed property fraud. The evidence the jury heard no doubt shows wrongdoing—deception, corruption, abuse of power. But the federal fraud statutes at issue do not criminalize all such conduct.”
That’s the part that Hosoda tries to leverage in Amemiya’s favor. Just because there might have been “deception, corruption, and abuse of power,” not all such situations can be prosecuted as federal crimes.
However, the opinion then continues: “Under settled precedent, the officials could violate those laws only if an object of their dishonesty was to obtain the Port Authority’s money or property.”
In the case of the Kealoha severance contract, it was the city’s money that was at stake. And the object of the alleged Honolulu conspiracy, as portrayed by the government, was to separate the money necessary to fund the severance package from the city coffers without having to air the issues before a potentially unfriendly city council. That would appear to fall squarely under the reach of this statute, and the Kelly decision does not appear to change that.
If that point wasn’t quite as Hosoda tried to spin it, I had to wonder what else in the memo appears to be aimed more for public posturing that for winning in court.
Another thing struck me right away. Hosoda’s filing asserts Amemiya was not part of negotiating the Kealoha deal. But he and the others are not charged with negotiating the deal. Nor does the indictment alleged the severance package was illegal. The charge is conspiracy to commit federal program theft and wire fraud in order to bypass the required appearance before the city council to seek approval for the cost of the deal.
According to the government’s memo, the indictment is supported by “voluminous discovery” in this case, which currently consists of “approximately 16,382 pages and 116 native files (out of which approximately 39 are media files), all of which currently subject to a protective order.
The discovery includes the names and statements of witnesses, reports of investigation by law enforcement, grand jury transcripts, grand jury exhibits and subpoena returns, court documents, phone records, recorded phone calls and interviews, and other evidence gathered during the investigation of this case. And although the discovery is voluminous, the United States has provided a detailed index with each of its discovery productions that provides the source and general description of each item included in the discovery.
The focus of the charge is the alleged conspiracy, which requires an agreement among the conspirators and at least one overt act in furtherance of the conspiracy’s illegal purpose. And that overt act may itself be something perfectly legal.
(“It is obvious that a conspiracy can be furthered by overt acts, some of which may or may not be criminal in nature.”); (“But there is no rule of law which requires an overt act to be an unlawful act. It may be in itself a perfectly lawful act which becomes unlawful only when it is committed in pursuance of and to effect the object of the conspiracy…). [case citations omitted]
Such is the nature of the conspiracy law.
In any case, if you’re interested in such things, here’s the government’s memo in opposition to the motion to dismiss the charges, and the reply by attorney’s representing Amemiya. And Amemiya’s reply can be read here.
A hearing on the motion to dismiss is scheduled next week.
United States' Response in Opposition to Amemiya Motion to Dismiss by Ian Lind on Scribd
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You are correct: whether or not Amemiya had anything to do with negotiating the Kealoha payout is virtually irrelevant here. The issue is the conspiracy to make the payout in the underhanded way that it was made. And let’s remember, a criminal conspiracy doesn’t even need to be successful in order to constitute a crime. So even if the parties here had done everything they did, then ultimately abandoned their plan and sought City Council approval for the payout, they could still be prosecuted for the conspiracy. This motion seems more pro forma than meaty.
In a related matter, neither the newspaper nor other media really questioned why former mayor and current gubernatorial candidate Kirk Caldwell recently made his highly unusual declaration that he would still run for governor, “even if some don’t think I can win,” via a newspaper ad rather than a traditional news conference surrounded by supporters.
The obvious answer is that he was ducking potential questions about the Kealoha payout, his potential involvement in orchestrating it, and the likelihood that the criminal charges against his top cabinet officials would damage his candidacy. And maybe his supporter bench is starting to thin.
The closest anyone came was a softball Hawaii News Now morning show “interview” in which Caldwell was asked if he believed the accused were innocent, and he haltingly proclaimed “I believe that there’s no way that a person like Donna and Roy would do anything that was in violation of law or do something that was somewhat, that was wrong.”
Caldwell’s own knowledge of the payout and its orchestration went completely unaddressed, and Caldwell’s appearance was largely a monologue.
The online summary of Caldwell’s appearance noted that “Caldwell was not charged, but political experts say the investigation likely jeopardized his run.
“For most people, they are going to assume that the mayor had some kind of knowledge and that will make a campaign for governor almost impossible,” said HNN political analyst Colin Moore.
Caldwell’s newspaper ad obviously addressed none of this, or any other reasons why voters might not believe he can win.
But it’s interesting to note that the ad appeared about nine days before HGEA, the state’s largest and most powerful public employee union, announced its endorsement of Lt. Governor and presumed gubernatorial front-runner Josh Green rather than Caldwell, who HGEA had previously endorsed while he ran for mayor.
So it seems likely that Caldwell had faced pressure to publicly state whether he was in or out of the governor’s race in order to have any chance of gaining the HGEA endorsement.
It will be interesting to see whether Caldwell now continues to raise significant amounts of campaign cash, whether he remains in the race, who publicly backs him, and what he has to say, or not say, about the federal charges faced by others.
It seems like the citizens of HNL (and now the state) want to “move on” from Caldwell. His “campaign” is now fueled mainly on ego and narcissism, it appears without addressing reality.
Well, Caldwell wasn’t directly asked by HNN about any role he may have had in the Kealoha payout or even whether he agreed with it, but after he said he believed his people were innocent he was asked in a very vague way “do you feel like you did anything wrong as the top man of that administration?” He responded “absolutely not,” followed by a very awkward silent pregnant pause. The interviewer didn’t seem prepared for any coherent follow-up questions, such as whether Caldwell had agreed with the alleged plan to circumvent the City Council, has been interviewed by investigators or had discussions with a defense attorney, and so then just weirdly moved on to the underlying Kealoha mailbox caper and Caldwell’s denial that he ever knew anything about all that until it blew up, which is probably true but is a totally different can of worms than the later payout to Kealoha. It was all so strange, and with Caldwell sitting in front of a fake background of Washington Place.
At about 11:15 of the video.
https://www.hawaiinewsnow.com/2022/02/18/former-honolulu-mayor-kirk-caldwell-wants-prioritize-affordable-housing-run-governor/
What’s the old saying by Founding Father Thomas Jefferson: “Ignorance of the law is no excuse in any country. If it were, the laws would lose their effect, because it can always be pretended.” ?
That’s the way I’m reading Amemiya’s defense is going. Seems attorney Hosoda is throwing spaghetti at the wall to see what sticks.
Lots of “straw man argument” at work here. The nut of this thing is that the conspiracy allegedly involved making the Kealoha payout from HPD’s budget with a plan in place to falsely claim later that HPD needed more money to fill vacant positions rather than to backfill the payout, and then lying to FBI about who knew what. Avoiding the need for City Council approval of payout was motive. Was Council approval required for expenditure of HPD funds already allocated? Straw man alert.
In the New Jersey, case known as “BRIDGE GATE” the similarities of conspiracy are clear. The component that “Bridge Gate” was missing was monetary gain. Weather for yourself, or a favored party. In this case Chief Kealoha was allegedly rewarded an unprecedented pot of money, despite being unworthy.
The money included some Federal funding, intermingled into to the H.P.D. kettle.
The percentage of Federal ingredients is irrelevant. The intent of alleged conspirators was to funnel funds, or “STEW” to feed Kealoha, in order to make the Mayor Happy.
In “Bridge Gate” a painful traffic mess was inflicted on the community. No one got to eat “STEW”. Only grief was bestowed.
The long tale of three Chefs, Amemiya, Leong and Sword. Who used questionable ingredients in production.
The recipe concocted around the law, was not Correct.
Due to a bad recipe, the “STEW” spoiled, leaving a bad taste in everyone’s mouth. Yet still strangely satisfying, served hot and plentifully.
The Mayor was so delighted, that His Police Chief was satisfied and would graciously fade away, without delay.
Unfortunately, the Mayor, did not realize His Chefs had allegedly poisoned the meal. Not only did the Chief had eat the “STEW”. The three Chefs, and the Mayor all ate a little. Everyone became severely ill, with horrid diarrhea.
The Chief was so sick, His wife was also stricken. The food poisoning became viralalant and spread to other leaders and wealthy Businesses people. The resulting health crisis, headlined the news for a year.
Sadly, the Chefs are all still blaming each other for souring the pot. The Mayor, now horrible disgraced, had hired the best Chefs in Hawaii. He may likely rejoin the Chief and the Chefs, back in College, retaking, Kosher Stewing #101 for Dummies.
Ditto WhatMeWorry!
I’m really curious what Caldwell is going to say when he goes on the stand. I can’t imagine this case being tried in federal court and him not being called.
One thing I haven’t seen mentioned by the defense yet, maybe they’re saving this for trial. But avoiding council approval for anything and everything is almost a mantra within the city’s executive branch. Executive branch personnel almost wield that as a weapon ‘oh you don’t wanna do that, it would require council approval’ even for legitimate and badly needed products or services. Not saying that this was or wasn’t the case here, just an observation after working with the city for a number of years.
That’s no defense to the charges here. That’s like saying “everybody goes through yellow lights, so we just went through a red one.”
That’s the NORM here.
The defense here is arguing a red herring by claiming that the indictment is based entirely on the false premise that City Council approval was required for the Kealoha payout.
But what the indictment actually alleges is that the defendants conspired to utilize a process that would not require initial Council approval for the payout and to lie about the use of public funds, and that they attempted to intimidate others into lying about it too.
That process was to use HPD’s approved salary budget to cover the Kealoha payout, and to later replace the payout money by telling the Council that more money was needed to pay HPD salaries for newly filled positions, according to the indictment.
The scheme collapsed when HPD truthfully informed the Council’s budget committee on May 24, 2017, that a proposed resolution authorizing the transfer of money between activities included money to replace the money that had been used for the Kealoha payout, despite defendant Amemiya’s attempt to bully HPD into hiding that key fact, according to the indictment.
By the way, the Council approved that resolution, No. 17-142, at a public meeting on June 7, 2017, and it was by then very clear that the money would pay the HPD salary account back for the Kealoha payout.
Then on November 13, 2017, defendant Leong was questioned by the FBI about conversations and circumstances leading to the Kealoha payout and made numerous false statements, according to the indictment.
So if officials who orchestrated the payout had done nothing wrong, why would anyone lie to the FBI about it?
I just watched the video from the 5/24/17 Council Budget Committee meeting at which the transfer of funds to cover the Kealoha payout shortfall was first approved.
After the HPD deputy chief clearly disclosed that the transfer included $250,000 to cover the shortfall caused by the hugely controversial payout, not a single council member had a single question or raised a single concern about the transfer before voting unanimously to approve it.
Not one of them blinked or raised an eyebrow, despite the arm-twisting that had allegedly occurred behind the scenes to keep HPD from publicly disclosing the truth about the shortfall. And not a single word when the transfer later was approved by the full council either.
So it really made me wonder whether any council “bananas” had private discussions about this arrangement and its legality with anyone who has since been indicted, or with the mayor.
And since all Council members from that time reportedly later testified before the grand jury that indicted Amemiya, Leong, and Sword, it makes me wonder whether transcripts of that testimony or from FBI interviews with council members is among the “voluminous discovery” that prosecutors amassed and that remains subject to a protective order, and what else that discovery could reveal.
It’s really a good thing that nobody has pled guilty, because by going to trial we might all get a much better peak at the truth.
If you want to watch your elected council members say nothing before approving the transfer of $250,000 in taxpayer money to cover a highly controversial and possibly illegal payout to a police chief who’s now in federal prison, it’s item six on the agenda at the video link below.
https://honolulu.granicus.com/player/clip/433?view_id=3&redirect=true
Fascinating.
Since two of those council members who voted to approve the transfer of money to backfill the possibly illegal payout, Menor and Anderson, are now running for lieutenant governor, it would be a great time for them to enlighten the community about all this.