You served as a member and employee of a Board of Registration (Board) which regulates certain companies. The Board is generally responsible for, among other things, licensing companies and investigating complaints against them.
While you were associated with the Board, you owned and operated several of these companies. You now wish to hold an interest in a general partnership (Partnership) which will operate a company regulated by the Board. You want to sell the assets of one of your other companies (Company X) to the Partnership. The Partnership will apply to the Board for approval of a change in ownership of Company X. The Board may conduct a hearing to determine the merits of the Partnership's application. If the application is approved, the licenses held by Company X will be relinquished to the Board which would then issue new licenses to the Partnership.
Does the state conflict of interest law, G.L. c. 268A, s.5 prohibit you or your partners from representing the Partnership on its application with the Board?
While you were a Board member and employee, you were considered a state employee within the meaning of the conflict of interest law. G.L. c. 268A, s.1(q. Because you resigned your state position, you are now considered a former state employee and are subject to the provisions of G.L. c. 268A, s.5. The conflict law prohibits you from acting as the agent for, or receiving compensation from a private entity in connection with a particular matter[1] in which the state is a party or has a direct and substantial interest if you participated[2] in the matter while employed by the state. G.L. c. 268A, s.5(a).[3] Therefore, you may not represent the Partnership on a matter which is of direct and substantial interest to the state (such as an application with the Board for a license) if you participated in this matter while you were employed by the state. Participation requires personal and substantial action on your part. Compare, EC-COI-81-113 (where action taken did not constitute "participation" under the conflict law because it was at a preliminary stage and was limited in scope); In the Matter of John R. Hickey, 1983 SEC 158 (where a ministerial act is not considered personal and substantial participation). The Partnership's application to the Board is a particular matter. See, G.L. c. 268A, s.1(k); EC-COI-84-31 (a determination of need application filed by a hospital with the Department of Public Health is a particular matter). Because this application has never been previously filed (the Partnership did not even exist during your tenure with the Board), this is not particular matter in which you participated while a state employee. See, EC-COI-84- 14 (where a new property assessment is a different particular matter from a prior assessment). Therefore, we conclude that you may be compensated by or represent the Partnership in connection with its application before the Board.[4] In light of the fact that there are no restrictions in G.L. c. 268A, s.5(a) which will prohibit you from representing the Partnership, there are similarly no restrictions on your partners. See, G.L. c. 268A, s.5(c).[5]