Docket No. 494

In the Matter of Kevin Honan

May 12, 1994

Disposition Agreement


This Disposition Agreement ("Agreement") is entered into
between the State Ethics Commission ("Commission") and Kevin Honan
("Rep. Honan") pursuant to s.5 of the Commission's Enforcement
Procedures. This Agreement constitutes a consented to final order
enforceable in the Superior Court, pursuant to G.L. c. 268B,
s.4(j).

On June 22, 1993, the Commission initiated, pursuant to G.L.
c. 268B, s.4(a), a preliminary inquiry into allegations that Rep.
Honan had violated the conflict of interest law, G.L. c. 268A. The
Commission has concluded its inquiry and, on January 25, 1994,
voted to find reasonable cause to believe that Rep. Honan violated
G.L. c. 268A, s.3 and 23(b)(3).

The Commission and Rep. Honan now agree to the following facts
and conclusions of law:

1. Rep. Honan has served in the state legislature from
January 1987 to the present. During that time, he has served on
various committees including the Government Regulations Committee
(vice chairman) and the Health Care Committee (vice chairman).

2. In addition, Rep. Honan, as a member of various
legislative committees, has participated in many hearings on bills
which impact on the insurance industry. Such participation has
included voting on whether such bills should be reported out of
committee. Rep. Honan has also voted on bills which impact the
insurance industry when they reached the House floor.

3. During the period relevant here, F. William Sawyer
("Sawyer") was the senior John Hancock Mutual Life Insurance
Company, Inc. ("Hancock") lobbyist responsible for Massachusetts
legislation. At all relevant times, Sawyer was a registered
legislative agent (for Hancock) in Massachusetts. Hancock, a
Massachusetts corporation, is the nation's sixth largest life
insurer doing business in all 50 states. It offers an array of
life, health and investment products. As a Massachusetts domiciled
life insurer, its activities are more comprehensively regulated by
Massachusetts than by any other state.

4. During the period relevant here, Ralph Scott ("Scott")
was also a lobbyist for Hancock.

5. During the period relevant here, William Carroll
("Carroll") was a registered legislative agent for the Life
Insurance Association of Massachusetts ("LIAM"). LIAM is a trade
association of the largest life insurance companies doing business
in Massachusetts.

6. At all relevant times, Rep. Honan knew that Sawyer and
Scott were Massachusetts registered lobbyists for Hancock. Rep.
Honan testified that he was never lobbied by Sawyer, Scott or
Carroll.

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7. Lobbyists are employed to promote, oppose or influence
legislation.

8. One way in which some lobbyists further their legislative
goals is to develop or maintain goodwill and personal relationships
with legislators to ensure effective access to them. Some
lobbyists entertain legislators through meals, drinks, golf and
sporting events in order to develop the desired goodwill and
personal relationships.

9. In 1991, Honan attended a Boston Celtics game as Scott's
guest and sat in Hancock's private skybox at the Boston Garden.
The ticket value was approximately $70.00.[1]

10. Between March 10, 1993 and March 14, 1993, Rep. Honan and
his guest stayed at the Plantation Resort at Amelia Island,
Florida, where an educational conference sponsored by the
Conference of Insurance Legislators was being held. Rep. Honan
neither registered for nor attended the conference.

On March 12, 1993, Sawyer paid for Rep. Honan's golf expenses
at the Valley Course at Sawgrass, a golf course located at Ponte
Verde, Florida. The cost of Rep. Honan's golf expenses was
$130.00.[2]

On the evening of March 12, 1993, Rep. Honan and his guest ate
dinner at the Ritz Carlton with a group of Massachusetts
legislators and lobbyists. Rep. Honan did not pay for this dinner.
Rep. Honan testified that although he knew that Massachusetts
lobbyists were in attendance, he did not know who paid for the
meal. Carroll, the lobbyist representing LIAM, paid for this
dinner.[3] The total cost of the dinner was approximately $3,000.
Honan and his guest's pro rata share of the cost of the dinner was
approximately $150.

11. Section 3(b) of G.L. c. 268A prohibits a state employee
from directly or indirectly receiving anything of substantial value
for or because of any official act or act within his official
responsibility performed or to be performed by him.

12. Massachusetts legislators are state employees.

13. Anything worth $50 or more is of substantial value for
s.3 purposes.[4]

14. By accepting the basketball game ticket from Scott and
the golf entertainment from Sawyer, all while Rep. Honan was in a
position to take official actions which could benefit those
lobbyists, Rep. Honan accepted items of substantial value for or
because of official acts or acts within his official responsibility
performed or to be performed by him. In doing so he violated
s.3(b).[5]

15. As the facts above indicate, Rep. Honan received, in
addition to the $200.00 in gratuities, a $150 meal where he did not
know the specific identity of the source of the entertainment.

16. Section 23(b)(3) prohibits a public employee from
knowingly or with reason to know acting in a manner which would
cause a reasonable person knowing all of the circumstances to
conclude that anyone can improperly influence or unduly enjoy his
favor in the performance of his official duties.

17. By accepting entertainment of $50 or more in value where
he did not know the specific identity of the donor, but had reason
to know that the donors were Massachusetts lobbyists, Rep. Honan
acted in a manner which would cause a reasonable person knowing all
these facts to conclude that the lobbyists present could improperly
influence him in the performance of his official duties.[6] In
other words, Rep. Honan knew or had reason to know that his actions
would create an appearance of favoritism. In so doing, he violated
s.23(b)(3).[7]

18. The Commission is aware of no evidence that the
gratuities or gifts referenced above were provided to Rep. Honan
with the intent to influence any specific act by him as a
legislator or any particular act within his official
responsibility. The Commission is also aware of no evidence that
Rep. Honan took any official action concerning any proposed
legislation which would affect any of the registered Massachusetts
lobbyists in return for the gratuities or gifts. However, even
though the gratuities were only intended to foster official
goodwill and access, they were still impermissible.[8]

19. Rep. Honan fully cooperated with the Commission
throughout its investigation.

In view of the foregoing violations of G.L. c. 268A by Rep.
Honan, the Commission has determined that the public interest would
be served by the disposition of this matter without further
enforcement proceedings, on the basis of the following terms and
conditions agreed to by Rep. Honan:

(1) that Rep. Honan pay to the Commission the sum of one
thousand and fifty dollars ($1,050.00) for violating G.L.
c. 268A, s.3(b) and 23(b)(3);[9] and


(2) that Rep. Honan waive all rights to contest the
findings of fact, conclusions of law and terms and
conditions contained in this

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agreement and in any related administrative or judicial
proceedings to which the Commission is or may be a party.


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[1] Rep. Honan has no specific recollection and Hancock has no
records indicating the exact date the basketball game occurred.
Rep. Honan testified that he believed the ticket value was
approximately $30.00.

[2] Rep. Honan testified that he was unaware of the value of the
golf.

[3] The Commission has evidence Carroll subsequently received
contributions of $500 and $600 from two of the Massachusetts
lobbyists who were at this meal.

[4] See Commonwealth v. Famigletti, 4 Mass. App. Ct. 584, 587
(1976); EC-COI-93-14.

[5] For s.3 purposes, it is unnecessary to prove that the
gratuities given were generated by some specific identifiable act
performed or to be performed. As the Commission explained in
Advisory No. 8, issued May 14, 1985, prohibiting private parties
from giving free tickets worth $50 or more to public employees who
regulate them,

Even in the absence of any specifically identifiable
matter that was, is or soon will be pending before the
official, s.3 may apply. Thus, where there is no prior
social or business relationship between the giver and the
recipient, and the recipient is a public official who is
in a position to use [his] authority in a manner which
could affect the giver, an inference can be drawn that
the giver was seeking the goodwill of the official
because of a perception by the giver that the public
official's influence could benefit the giver. In such a
case, the gratuity is given for his yet unidentifiable
"acts to be performed."

Specifically, s.3 applies to generalized goodwill-engendering
entertainment of legislators by private parties, even where no
specific legislation is discussed. In re Flaherty, 1991 SEC 498,
issued December 10, 1990 (majority leader violates s.3 by accepting
six Celtics tickets from billboard company's lobbyists). In re
Massachusetts Candy and Tobacco Distributors, Inc., 1992 SEC 609
(company representing distributors violates s.3 by providing a free
day's outing [a barbecue lunch, golf or tennis, a cocktail hour and
a clam bake dinner], worth over $100 per person, to over 50
legislators, their staffers and family members, with the intent of
enhancing the distributors' image with the Legislature and where
the legislators were in a position to benefit the distributors).

Section 3 applies to meals and golf, including those occasions
motivated by business reasons, for example, the so-called "business
lunch". In re U.S. Trust, 1988 SEC 356. Finally, s.3 applies to
entertainment gratuities of $50 or more even in connection with
educational conferences. In re Stone & Webster, 1991 SEC 522, and
In re State Street Bank, 1992 SEC 582.

On the present facts, s.3 applies to the lobbyists
entertaining Rep. Honan where the intent was generally to create
goodwill and the opportunity for access, even though specific
legislation was not discussed.

[6] Moreover, the possibility can never be eliminated that Rep.
Honan would later be told of the specific sources of the various
gratuities described above. This only adds to the appearance
concern created by such conduct.

[7]This conduct also raises issues under s.3 discussed above.
Nothing in s.3 requires that the public official know the source of
the gift. All that is required is that the public official know
that he is receiving the gift for or because of official acts or
acts within his official responsibility. On the foregoing
facts, that could be inferred even though Rep. Honan did not know the
specific identity of the donor. In any event, because this is a
matter of first impression, the Commission has decided to resolve
this conduct pursuant to s.23.

[8]As discussed above in footnote 5, s.3 of G.L. c. 268A is
violated even where there is no evidence of an understanding that
the gratuity is being given in exchange for a specific act
performed or to be performed.

[9] This amount is three times the value of the $350.00 in
prohibited gratuities received by Rep. Honan in violation of s.3.
It represents both a disgorgement of the gratuities and a civil
sanction.

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