| Date: | 07/26/2010 |
|---|---|
| Organization: | State Ethics Commission |
| Docket Number: | 08-0014 |
Petitioner filed Orders to Show Cause ("OTSC") on June 26, 2008, against Respondents James M. Ruberto ("Ruberto"), the Mayor of the City of Pittsfield ("City"), and Daniel Duquette ("Duquette"), owner of the New England College Baseball League ("NECBL") team, the Berkshire Dukes ("Dukes"). The OTSC allege that Duquette violated G.L. c. 268A, § 3(a) by offering to sell two tickets to Game 2 of the 2004 World Series at face value to Ruberto, and that Ruberto, a municipal employee, violated G.L. c. 268A, §§ 3(b), 23(b)(2) and 23(b)(3) by accepting that offer at a time when he and Duquette were negotiating the Berkshire Dukes' move to play at the City's Wahconah Park. The proceedings in these matters were consolidated pursuant to 930 CMR 1.01(6)(g).
An evidentiary hearing was held on April 6, 2010 and April 7, 2010. [1] At the hearing, the parties made opening statements and introduced evidence through witnesses and exhibits. All parties filed briefs. [2] The parties presented closing arguments to the Commission on June 18, 2010. [3]
The Commission began its deliberations in executive session on this matter on June 18 and continued deliberations on July 16, 2010. [4] In rendering this Final Decision and Order, each undersigned member of the Commission has considered the testimony, the evidence in the public record, and the arguments of the parties.
A. G.L. c. 268A, § 3(a) Allegations Against Duquette
In relevant part, § 3(a) prohibits an individual from directly or indirectly giving, offering or promising anything of substantial value to any municipal employee for or because of any official act performed or to be performed by such an employee. In order to establish a violation of § 3(a) against Duquette, Petitioner must prove by a preponderance of the evidence that he (1) directly or indirectly gave, offered, or promised anything of substantial value to Ruberto, (2) for or because of any official act, (3) performed or to be performed by Ruberto.
We find that Petitioner has proved by a preponderance of the evidence that Duquette violated § 3(a).
1. Duquette's Offer to Sell the Tickets to Ruberto was an Offer of Something of "Substantial Value."[7]
Duquette argues that his offer to sell the Tickets to Ruberto at face value was not an offer of something of substantial value. [8] Petitioner argues that a reasonable person who wanted to attend Game 2 of the 2004 World Series would pay $50 or more over the face value ($190.00 per ticket) to purchase the Tickets. Matthew Freedman ("Freedman"), the Director of Purchasing at Ace Ticket Worldwide Incorporated, testified that: there was an "incredible demand" for tickets to Game 2 of the 2004 World Series; the average per ticket price for a "good seat" was $2,000 to $3,000 per ticket; and the Tickets Ruberto purchased from Duquette were "top quality tickets."
In Commission Advisory No. 04-01 entitled Free Tickets and Special Access to Event Tickets ("Advisory"), issued on January 15, 2004, the Commission specifically stated that the opportunity to purchase tickets not available to the general public may be a special benefit or privilege of substantial value. According to the Advisory, "[t]he fundamental question, in each case, is whether a reasonable person wishing to attend the event would pay $50 or more over face value to purchase the . . . tickets that the public official is being provided the opportunity to purchase at face value." [9] It also specifically addresses issues that arise under the conflict of interest law when World Series tickets are offered to public officials for purchase at face value: "conflict of interest concerns would be raised if tickets to a major sporting event such as . . . a World Series game were offered to public officials/employees to purchase at face value" because "[s]uch tickets are limited in number and not readily available to the general public for purchase at face value."
Based on Freedman's testimony, we are persuaded that a reasonable person wishing to attend Game 2 of the 2004 World Series would pay $50 or more over face value ($190) to purchase the Tickets. There is sufficient evidence that Tickets to Game 2 of the 2004 World Series, which were similar in quality to the Tickets Ruberto received from Duquette, sold for between $2,000 and $3,000 per ticket. Therefore, we find that Duquette's offer to sell the Tickets for the face value ticket price was an offer of something of substantial value.
2. Duquette offered to sell the Tickets to Ruberto "for or because of an official act" Ruberto performed or would perform. [10]
The crux of this case hinges on whether Duquette offered to sell the Tickets to Ruberto "for or because of any official act" Ruberto performed or would perform. The Supreme Judicial Court has held that "it is necessary to establish a link between a gratuity and an official act." [11] Pursuant to Scaccia, to establish a violation of § 3 there must be "proof of linkage to a particular official act, not merely the fact that the official was in a position to take some undefined or generalized action, such as holding a hearing on proposed legislation that, if passed, could benefit the giver of the gratuity." [12] In Scaccia,the Court vacated the § 3 violation because the administrative record contained "no findings, and no evidence in the record, that the gratuities influenced any specified official act by Scaccia." See also Sun-Diamond Growers of California, 526 U.S. at 405 (holding that the gratuity statute was not satisfied by a showing that a gratuity was given "to build a reservoir of goodwill that might ultimately affect one or more of a multitude of unspecified acts, now and in the future").
In analyzing whether a gratuity was given "for or because of an official act performed," the Commission "will weigh the totality of all of the circumstances surrounding the gratuity, drawing reasonable inferences from the circumstances." [13] The Commission may consider such factors as the subject matter of the pending matter and its impact on the giver, the outcome of particular votes, the timing of the gift, or changes in a voting pattern. [14] The Commission has previously concluded that there is insufficient proof to establish a § 3 violation where the Petitioner has not identified any specific past, present or future action for or because of which the gift was offered, even where the gift was offered with the intent to "foster generalized good will." In re LIAM 2003 SEC 528. Because the Supreme Judicial Court stated in Scaccia that "only a one-way nexus need be established for a gratuity violation," the Commission stated in LIAM that "the relevant issue here is the intent of LIAM in giving the gratuities, not the intent of the public officials who accepted the gratuities." Id.
On one hand, Duquette contends that he did not offer the Tickets to Ruberto for or because of any specific official act Ruberto performed or would perform as Mayor, but rather merely with the intent to create generalized goodwill with Ruberto. Duquette contacted Ruberto about the Dukes moving from Hinsdale to Pittsfield near the time when he offered to sell the Tickets to Ruberto. Ruberto told Duquette that the City was not interested in an NECBL team at the time because he was still trying to find a professional team to play in Pittsfield. Duquette maintains that the October 14, 2004 e-mail he sent to Ruberto establishes that no negotiations or decision regarding the Dukes had occurred. The e-mail did not refer to any specific official act, or to any decision Ruberto had already made. Duquette also argues that Petitioner has only provided evidence of an inchoate proposal for Duquette to move the Dukes to Pittsfield around the time he sold the Tickets to Ruberto, which is insufficient to establish linkage under Scaccia. [15] Duquette also maintains that there was nothing repeated, planned or targeted about his sale of the Tickets to Ruberto. Duquette did not discuss any official actions with Ruberto during the sale of the Tickets. In addition, Duquette provided at least ten individuals other than Ruberto with 2004 World Series tickets. Duquette also maintains that he and Ruberto were personal acquaintances, who first met in 2003 through Duquette's aunt and uncle who were close friends of Mayor Ruberto.
In contrast, Petitioner argues that Duquette approached Ruberto and offered to sell the Tickets to Ruberto at face value because he knew that Ruberto would be involved in any discussion to bring a baseball team into Pittsfield. Petitioner maintains that Duquette sold the Tickets to Ruberto at face value, with the intent to influence Ruberto's official actions regarding the licensing agreement and the concession stand agreement ("Agreements"). [16] Petitioner contends that Duquette was aware that he needed Ruberto's backing as Mayor to obtain those Agreements. [17] Petitioner asserts that there is a sufficient link, as required under Scaccia and LIAM, between Duquette's offer to sell the Tickets to Ruberto and Ruberto's official actions because the Agreements allowed the Dukes to play in the City; Ruberto was not interested in the Dukes moving to the City in early 2004; Duquette offered the Tickets to Ruberto around the time Duquette made his third attempt to interest Ruberto in the Dukes' move; the Tickets had a face value of $190.00 each, but a street value of $2000 - $3,000 each; the gift was targeted to Ruberto; there was no reciprocity; and Duquette was not lacking in sophistication.
Although it is a close question, based on all of the evidence, we conclude that the Petitioner has established that Duquette offered to sell the Tickets to Ruberto with the intent to influence Ruberto's official actions regarding the Agreements and the Dukes move to Pittsfield. The Tickets were extremely valuable and highly sought after. Duquette could have offered to sell the Tickets to any number of Red Sox fans. Duquette specifically offered to sell the Tickets to Ruberto because he knew that Ruberto's lifelong dream was to see the Red Sox play in the World Series at Fenway Park, and he knew that offering the Tickets to Ruberto could lead Ruberto to help him to obtain license and concession agreements and to bring the Dukes to Pittsfield. Duquette understood that Ruberto's support of the license and concession agreements were essential in order for the Dukes to move to Pittsfield. There is no evidence that Duquette had a social relationship with Ruberto, nor is there any evidence of any reciprocity. We therefore find, based on the totality of the circumstances, that Petitioner has established by a preponderance of the evidence that Duquette intended to offer the Tickets to Ruberto to influence future actions Ruberto would take as Mayor related to the Agreements and the Dukes' move to Pittsfield.
B. G.L. c. 268A, § 3(b) Allegations Against Ruberto
In relevant part, § 3(b) prohibits a municipal employee from directly or indirectly receiving anything of substantial value for or because of any official act performed or to be performed by such employee. In order to establish a violation of § 3(b) against Ruberto, Petitioner must prove by a preponderance of the evidence that he (1) was a municipal employee, [18] (2) directly or indirectly received anything of substantial value from Duquette, [19] (3) for or because of any official act, (4) performed or to be performed by Ruberto.
We find that Petitioner has proved by a preponderance of the evidence that Ruberto violated § 3(b).
The key issue here is whether Ruberto received the Tickets from Duquette "for or because of any official act" Ruberto performed or would perform. As discussed above, to establish a violation of § 3 there must be "proof of linkage to a particular official act, not merely the fact that the official was in a position to take some undefined or generalized action, such as holding a hearing on proposed legislation that, if passed, could benefit the giver of the gratuity." [20]
Ruberto contends that he did not receive the Tickets for or because of an official act performed or to be performed. The Mayor told Duquette that the City was not interested in an NECBL team at the time because he was still trying to find a professional team to play in Pittsfield. Ruberto contends that there is no evidence that his future official actions were influenced by the fact that he purchased the Tickets from Duquette. Ruberto did not consider negotiating with Duquette about the Dukes' move to Pittsfield until he had exhausted all other possibilities of finding a professional team. Ruberto was only interested in beginning negotiations with Duquette when he realized that he would not be able to find a professional team to play in Wahconah Park. Further, when negotiations between Duquette and the City began, Ruberto engaged in contentious bargaining with Duquette and obtained a favorable contract for the City.
Petitioner asserts that there is a sufficient link, as required under Scaccia and LIAM, between Ruberto's receipt of the Tickets from Duquette and Ruberto's official actions because the Agreements that Ruberto participated in negotiating on behalf of the City allowed the Dukes to play in the City. Petitioner maintains that Ruberto intended to be influenced by the Tickets because: (1) Ruberto mentioned to Duquette that he wanted to attend the Red Sox World Series while discussing the Dukes' move to Pittsfield with Duquette; (2) Ruberto directed the City's Director of Community Services, James McGrath, to research other communities' experiences with NECBL teams and when McGrath obtained the information, Ruberto informed him that it was a "top priority"; and (3) the day after the game, the City Solicitor told Duquette via e-mail that he was excited "to do business with Dan Duquette."
Although it is a close question, based on all of the evidence, we find that the Petitioner has established that Ruberto received the Tickets from Duquette to influence Ruberto's official actions regarding the Agreements, and Ruberto intended to receive the Tickets for or because of official acts he performed or would perform in the future related to the Dukes move to Pittsfield. Ruberto told Duquette that his life-long dream was to see the Red Sox play in the World Series at Fenway Park. Although Duquette had repeatedly asked Ruberto to consider moving the Dukes, to Pittsfield, Ruberto did not consider this until shortly after he received the Tickets from Duquette. Although Ruberto ultimately negotiated a deal that was favorable to the City, this does not negate the § 3(b) violation. Despite negotiating a mutually beneficial deal between Duquette and the City, Ruberto nevertheless received the Tickets for or because of official acts he performed in the future related to the Dukes. Therefore, we find that Petitioner has established by a preponderance of the evidence that Ruberto violated § 3(b).
C. G.L. c. 268A, § 23(b)(2) and § 23(b)(3) Allegations Against Ruberto
1. Section 23(b)(2)
Section 23(b)(2) prohibits municipal employees from knowingly or with reason to know, using or attempting to use their official positions to secure for themselves or others unwarranted privileges or exemptions of substantial value which are not properly available to similarly situated individuals. In order to establish a violation, Petitioner must prove by a preponderance of the evidence that: (1) Ruberto was a municipal employee; [21] (2) who knowingly or with reason to know used or attempted to use his official position; (3) to secure an unwarranted privilege or exemption [22] for himself or others; (4) which was of substantial value; [23] (5) which was not properly available to similarly situated individuals.
We must first determine whether Ruberto knowingly, or with reason to know used or attempted to use his official position as Mayor to obtain the opportunity to purchase the Tickets from Duquette. Ruberto claims that Duquette offered him the Tickets because he is a Red Sox fan, not because of his position as Mayor. Further, Ruberto maintains that he and Duquette had been acquaintances since 2003, when they were introduced by Duquette's aunt who is a good friend of Ruberto's. Ruberto also notes that Duquette gave away or sold ten tickets to the 2004 World Series games. On the other hand, Petitioner maintains that Ruberto was only communicating with Duquette because Duquette had proposed to move the Dukes to Pittsfield. In addition, Petitioner contends that Ruberto knew that he was being offered the opportunity to purchase the Tickets at face value because he was the Mayor of Pittsfield.
Based upon the following evidence we find that Ruberto knowingly, or with reason to know used or attempted to use his official position as Mayor to obtain the opportunity to purchase the Tickets from Duquette. We find that Ruberto and Duquette did not have a personal social relationship. Ruberto and Duquette were communicating because Duquette wanted to bring the Dukes to Pittsfield. As Mayor of the City, Ruberto was in a position to either help Duquette obtain a deal with the City, or to prevent a deal from being reached. Based on the evidence provided, it is reasonable to infer that Ruberto either knew or should have known that the Tickets were offered to him because of his position as Mayor.
Next, we must determine whether Ruberto's receipt of the Tickets was an unwarranted privilege. Ruberto argues that purchasing the Tickets from Duquette at face value was not an unwarranted privilege, but rather an arm's-length transaction. Petitioner asserts that the opportunity to purchase the Tickets at face value was a privilege. This privilege was unwarranted because there was no reasonable justification for Ruberto to obtain such a privilege. The Commission has previously concluded that an "unwarranted privilege" is one that is "[l]acking adequate or official support" or "having no justification; groundless." See EC-COI-98-2. Although Duquette and Ruberto were acquaintances, they did not have a social relationship. In October 2004, they were communicating with each other because Duquette wanted to move the Dukes to Pittsfield. Therefore, we find that there was no reasonable justification for Ruberto to receive the opportunity to purchase the Tickets at face value from Duquette and that this was an unwarranted privilege.
Finally, we must determine whether the opportunity to purchase the Tickets at face value was an unwarranted privilege of substantial value that was not properly available to similarly situated individuals. Ruberto contends that tickets to Game 2 of the 2004 World Series were available at face value to the general public. He states that tickets were available to 39,000 other individuals who attended the game. Ruberto also maintains that the Petitioner has failed to establish that the Tickets were not available to the general public without engaging in scalping activities. On the other hand, Petitioner argues that in this case, similarly situated individuals, were Red Sox fans who reside in Pittsfield. We find that there was an "incredible demand" for tickets to Game 2 of the 2004 World Series and the Tickets Ruberto purchased from Duquette were of top quality. Accordingly, we find that tickets to Game 2 of the 2004 World Series, similar to the tickets Duquette sold to Ruberto, were not properly available for purchase at face value to individuals similar to Ruberto; either Red Sox fans in Pittsfield, or Mayors of other municipalities.
We find, that Petitioner has established by a preponderance of the evidence that Ruberto was a municipal employee who knowingly or with reason to know used or attempted to use his official position to secure an unwarranted privilege for himself which was of substantial value which was not properly available to similarly situated individuals.
2. Section 23(b)(3)
Section 23(b)(3) prohibits a municipal employee from knowingly or with reason to know acting in a manner that would cause a reasonable person having knowledge of the relevant circumstances to conclude that any person could improperly influence or unduly enjoy his favor in the performance of his official duties or that he was likely to act or fail to act as a result of kinship, rank, position or undue influence of any party or person. Section 23(b)(3) further provides that "[i]t shall be unreasonable to so conclude if such . . . employee has disclosed in writing to his appointing authority or, if no appointing authority exists, discloses in a manner which is public in nature, the facts which would otherwise lead to such a conclusion." In order to establish a violation, Petitioner must prove by a preponderance of the evidence that: (1) Ruberto was a municipal employee; (2) who knowingly, or with reason to know, acted in a manner; (3) which would cause a reasonable person, having knowledge of the relevant circumstances, to conclude; (4) that any person can improperly influence or unduly enjoy his favor in the performance of his official duties, or that he is likely to act or fail to act as a result of kinship, rank, position or undue influence of any party or person.
Ruberto knowingly acted as Mayor in matters affecting Duquette and the Dukes shortly after Duquette sold Ruberto the Tickets at face value. By so participating, Ruberto knowingly or with reason to know, acted in a manner which would cause a reasonable person, knowing of all the relevant circumstances, to conclude that Duquette can improperly influence the performance of Ruberto's official duties. Ruberto did not file a disclosure pursuant to 23(b)(3) stating that Duquette sold him the Tickets prior to participating in the matters affecting Duquette and the Dukes. Therefore, we find that Petitioner has established by a preponderance of the evidence that Ruberto violated G.L. c. 268A, § 23(b)(3).
To comply with G.L. c. 268A, Duquette should not have sold the Tickets to Ruberto and Ruberto should not have purchased the Tickets from Duquette. Rather, Duquette should have sold the Tickets to someone other than Mayor Ruberto and Ruberto should not have purchased the Tickets at face value from someone with whom he had recently had official dealings and with whom he would likely have future official dealings with respect to a specific identifiable issue of public concern - whether Duquette's NECBL team would play in Pittsfield and under what terms. The fact that Ruberto drove a hard bargain and in fact was not influenced by the gift does not alter the fact that he had every reason to know that, but for Duquette's interest in getting the Dukes to Pittsfield, Ruberto would not have been selling him prime seats at a World Series Red Sox game.
We have concluded that Respondent Daniel Duquette violated G.L. c. 268A, § 3(a) and Respondent James M. Ruberto violated G.L. c. 268A, §§ 3(b), 23(b)(2) and 23(b)(3). On balance, considering the totality of the circumstances in this particular case, we find that a civil penalty is not appropriate for the following reasons.
First, although we have concluded that there is a sufficient nexus between Duquette's sale the Tickets to Ruberto and Ruberto's receipt of the Tickets, to establish violations of § 3(a) and 3(b), we acknowledge that it is a very close question whether Duquette offered the Tickets to Ruberto for or because of a specific official act or actions, or merely to obtain generalized goodwill with the Mayor. In addition, at the time Duquette offered the Tickets to Ruberto, he did not believe that Ruberto was interested in discussing the Dukes' move to Pittsfield, because Ruberto had made it clear that he wanted a professional minor league team to play at Wahconah Park rather than an NECBL team, such as the Dukes. Further, there is no evidence that Ruberto was influenced by the Tickets in his negotiations with Duquette regarding the Dukes' move to Pittsfield. Rather, the negotiations between Ruberto and Duquette were contentious and resulted in a deal that was favorable to the City.
Second, Advisory 04-01, which specifically explains that conflict of interest issues would be raised "if tickets to a major sporting event such as [a] . . . World Series game were offered to public officials/employees to purchase at face value" because "[s]uch tickets are limited in number and not readily available to the general public for purchase at face value," and that "it is not necessary that a public official/employee initially solicit the opportunity to purchase the tickets. It may be sufficient if he accepts the special access to the tickets offered as a result of his official position," was issued less than a year before Duquette sold the Tickets to Ruberto. We are persuaded that Ruberto, who was a newly elected Mayor in 2004 and Duquette, who was not a public employee, were not aware of Advisory 04-01 in October 2004. There is also evidence that Duquette did not believe that he could charge Ruberto more than face value for the Tickets because he believed that this would violate laws related to scalping. Duquette and Ruberto both understood that Duquette could not give the Tickets to Ruberto. However, Duquette and Ruberto believed that they were complying with both the conflict of interest law and scalping laws by selling and purchasing the Tickets at face value.
I concur with the majority's reasoning in finding that Respondent Daniel Duquette violated G.L. c. 268A, § 3(a); that Respondent James M. Ruberto violated G.L. c. 268A, §§ 23(b)(2) and 23(b)(3); and that Respondent Ruberto's violation be resolved without a civil penalty. However, I do not agree with the majority's resolution of Respondent Duquette's violation. I would have imposed a civil penalty as I believe that Duquette offered the Tickets to Ruberto to influence his future actions concerning the Dukes' move to Pittsfield. Respondent Daniel Duquette's action in this matter was intentional and as such is deserving of a civil penalty.
I respectfully disagree with the Commission's finding that the Petitioner has established that Ruberto accepted the Tickets "for…any official act or act within his official responsibility…to be performed by him" in violation of G.L. c. 268A, § 3(b). I found Ruberto's testimony credible that he did not intend to be influenced and was not, in fact, influenced by the Tickets. Ruberto only considered Duquette's proposal as a last resort when he found that there was no professional baseball team interested in moving to Pittsfield. His negotiations concerning Duquette's proposal makes it clear to me that the only interest he was promoting was the City's. I agree with the remainder of the Commission's decision.
