PMA Client Sues Because it Didn’t Get Earmark; More Evidence of Pay-to-Play? (Murtha Again)

National Legal and Policy Center ^ | 6-29-09 | John Carlisle

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PMA Client Sues Because it Didn’t Get Earmark; More Evidence of Pay-to-Play?

By John Carlisle

Created 06/29/2009 - 17:09

Alexander Comisar reported [1] in Roll Call on June 23:

The PMA Group, the lobbying titan that closed its doors in March after an FBI raid, has filed more than a dozen lawsuits against former clients for failure to pay outstanding debts. Now, one company has responded with a $3 million countersuit that alleges PMA cheated it out of an earmark it was expecting to receive. PMA’s lawyer called the complaint absurd and said the firm has filed a formal response with the court.

The lawsuit filed by the Michigan-based Badenoch company provides yet further evidence of what many suspect is a pay-to-play scheme in which influential members of Congress target earmarks to companies in their districts and, in turn, receive cash donations for their re-election campaigns.

PMA Group founder Paul Magliocchetti is reportedly under investigation [2] for possibly funneling donations to congressional campaigns using straw donors. Rep. John Murtha (D-PA) in particular benefited greatly from the Washington, D.C.-based PMA Group and companies it represented. Before launching PMA Group in 1989, Magliocchetti served as an aide to Murtha. Since 1989, PMA Group and its clients have given $2.37 million to Murtha. In turn, between 1998 and 2009, Murtha earmarked $38.1 million to PMA clients.

Earlier this month, the House Ethics Committee announced that it is examining the tie between earmarks and campaign contributions. House Majority Leader Steny Hoyer (D-MD) said that “substantial questions had been raised” concerning the relationship between lawmakers and the PMA lobbying group. “This is a serious matter and it ought to be dealt with,” said Hoyer.

Whether the Ethics Committee will actually do anything remains to be seen. Nevertheless, the federal raid and the growing investigation make it increasingly difficult for Nancy Pelosi and the Democratic leadership to ignore the possibility that Murtha and other Democrats could be involved in illegally trading earmarks for campaign cash.

The case of the Badenoch company shows that there was a clear understanding that retaining the PMA Group meant access to earmarks. Badenoch, a defense engineering firm, received a $3 million earmark in the fiscal year 2009 budget to advance its research into creating an alternative to the military’s Humvee.

Badenoch paid PMA Group $80,000 in 2008.

On April 24, PMA sued Badenoch claiming that it had failed to pay its monthly bill for lobbying services since July. But Badenoch countersued, charging breach of contract. Badenoch was expecting to receive the same $3 million earmark for fiscal year 2010. When it didn’t, it accused PMA of dropping the ball.

In its June 5 complaint before the Arlington, Virginia County Circuit Court, Badenoch says that it “was advised from congressional officials that it should expect to receive approximately $3 million in earmarks for continued development of its projects to the United States Army.” However, the earmark never came because PMA failed to file the formal request required by Congress.

The company claims that the PMA Group not only missed the February deadline for submitting the earmark paperwork but failed to inform Badenoch that the deadline had been missed. The company is seeking $3 million in damages.

Badenoch apparently had no idea that PMA had been raided, which obviously would have affected its ability to deliver the promised earmark. “PMA concealed the fact that the FBI raided its offices and was under investigation,” says the company’s complaint. “Because PMA had been raided by the FBI and was under investigation, it was unable to perform its services.”

Carmen Jacobs, PMA’s lawyer, says Badenoch’s counterclaim is baseless because an earmark cannot be guaranteed by any congressional officials before it is formally granted. “They can make any allegation they want, but they are out of their minds,” said Jacobs. “You don’t get guarantees from Congress on earmarks.”

Perhaps that argument is legally accurate but the Badenoch case clearly shows that the PMA Group operated on the principle that by paying for its services it would deliver federal largesse.

Badenoch's earmark was supported by Senator Carl Levin (D-MI), Rep. Debbie Stabenow (D-MI), and former Rep. Joe Knollenberg (R-MI). The fact that the company is based in Troy, Michigan, a suburb of Detroit, hardly can be coincidence.

It certainly raises strong suspicions that in exchange for more than $2 million in campaign donations from PMA clients since 1989, Murtha may have repaid those grateful gestures with tens of millions of dollars in earmarks.

photo: AP/Wide World

• Carl Levin
• Debbie Stabenow
• Earmarks
• Government Integrity Project
• House Ethics Committee
• Joe Knollenberg
• John Murtha
• Nancy Pelosi
• PMA

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Source URL: http://www.nlpc.org/stories/2009/06/29/pma-client-sues-because-it-didn%E2%80%99t-get-earmark-more-evidence-pay-play

Links:
[1] http://www.rollcall.com/issues/54_150/news/36139-1.html?type=printer_friendly
[2] http://www.nlpc.org/stories/2009/03/13/more-scrutiny-murtha-investigative-noose-tightens

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Pingaroo

[jazusamo]

It just doesn't get much more corrupt than this, the corrupt are suing the corrupt.

Murtha will not get sued because he is still getting earmarks for his corrupt clients.

Murtha Watch Ping!

Code Pinkos

To be added to the Murtha Watch ping list please notify myself or RedRover.

[smoothsailing]

PMA may soon be Murtha’s undoing. The firm was founded by his top operative Paul Magliocchetti, who is now reportedly under investigation for making campaign donations in the names of other people. Campaign finance violations are not treated seriously by prosecutors, except for this one. The result can be prison time and big fines. If faced with the prospect of jail, would Magliocchetti turn on Murtha?

This NLPC is an interesting source link, Jaz. I don't remember being aware of it before today.

[jazusamo]

Thanks, Smooth. I’ve added to my sites to check, I wasn’t aware of it either.

[Munz]

this is so bad it it is almost like satire

[jazusamo]

Happened to come across this just now on your story from yestaerday, Smooth.

Is Murtha Trying to Distance Himself From Magliocchetti?

Submitted by Peter Flaherty on Tue, 06/30/2009 - 15:45

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Last night, we received this email under the subject line “Innaccurate (sic) Statement in Story Post” from Matt Mazonkey, Communications Director for Rep. John Murtha:

In a 06/29/09 post (PMA Client Sues Because it Didn’t Get Earmark; More Evidence of Pay-to-Play?), John Carlisle inaccurately stated that "Magliochetti (sic) served as an aide to Murtha."

Magliochetti (sic) served as a staff analyst for the Defense Appropriations Subcommittee, Murtha was never Chairman or Ranking Member while Magliochetti (sic) worked for the subcommittee. In fact, Magliochetti (sic) worked for Chairman Bill Chappel and full committee chairman Jamie Whitten.

Please correct this mistake.

Since Murtha’s office seized on such a tiny and debatable “mistake,” I thought it would be fun to call Mazonkey to see how far he would go in trying to distance his boss from Paul Magliocchetti, the former principal of the PMA Group lobbying firm that collapsed shortly after being raided by the FBI.

I asked Mazonkey if Murtha and Magliocchetti were “personal friends.” He responded, “I don’t know how you define personal friends.” He did concede that “they have known each other for twenty years.”

I asked him if he “took issue” with the March 30 New York Times characterization of Magliocchetti as Murtha’s “protégé.” Mazonkey replied, “I do take issue with it.”

Finally, I asked him if “it’s fair to say that Magliocchetti has made a lot of money because he knows Murtha.” Mazonkey said, “I can’t say that, obviously.”

Obviously.

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That's a hoot! Mazonkey is a lousy liar.

From the New York Times article...

Mr. Magliocchetti came to know Mr. Murtha more than 20 years ago, working as a Navy budget analyst for the subcommittee during the Reagan boom in military budgets. Both grew up in Western Pennsylvania — Mr. Murtha in Johnstown, and Mr. Magliocchetti in Pittsburgh.

And when the aide left to start his lobbying firm in 1989, he helped Mr. Murtha recruit major military contractors to attend a new annual trade fair in Johnstown that became the cornerstone of the lawmaker’s effort to steer business to the area.

..and that's just a hint of the article. Heck, "friends", "protege", who cares? They're definitely soulmates and bunk buddies! And Magliocchetti got rich on Murtha earmarks, the record is clear. The reason Mazonkey can't say any of that is because he values his own skin. His personal wellbeing depends on lies. He's just lousy at it.

[jazusamo]

Thought you’d get a kick out of that. LOL!

Mazonkey didn’t expect to get pressed on his BS email and mincing of words and he got it shoved down his throat big time. I love it!

[smoothsailing]

The kid is only 25, and he’s only been out of school for four years(PolySci Major-Pitt-’05). Murtha hired him right out of college. He’s in way over his head. Otherwise, he’d know he can’t keep on putting out the crap he is and not get called on it. He oughta run away from Murtha as fast as he can, while he still can, before his character and credibility are beyond repair.

[jazusamo]

I had no idea he is that young. You’re right, he should run as fast as he can and get away from Fat Jack, if he doesn’t he’ll just hurt himself.

Yay, Pirates !!! :-)

[smoothsailing]

HAR, MATEY!!!

[Munz]

If they weren’t in congress or connected with congress they would be in jail.
THIS IS A CORRUPT GOVERNMENT 100%

No if’s ands or buts.
the only reason that they get away with it is because more American’s aren’t FReepers.

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the only reason that they get away with it is because more American’s aren’t FReepers.

Well Said!!!