Settlement  In the Matter of Michael Tocco

Date:	06/07/2011
Organization:	State Ethics Commission
Docket Number:	11-0010

Disposition Agreement

The State Ethics Commission ("Commission") and Michael Tocco ("Tocco") enter into this Disposition Agreement pursuant to Section 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, § 4(j).

On January 21, 2011, the Commission initiated, pursuant to G.L. c. 268B, § 4(a), a preliminary inquiry into possible violations of the conflict of interest law, G.L. c. 268A, by Tocco. The Commission has concluded its inquiry and, on March 18, 2011, found reasonable cause to believe that Tocco violated G.L. c. 268A.

The Commission and Tocco now agree to the following findings of fact and conclusions of law:

Findings of Fact

1. The Board of Registration in Pharmacy ("the Board") regulates pharmacies and pharmacists in Massachusetts. The ten-member board includes physicians, pharmacists, and pharmacy industry representatives.

2. Tocco has been a Board member since November 2007. He is also president of Integrated Pharmacy Solutions ("IPS"), a Melrose firm that consults to hospitals and pharmacies.

3. Among IPS's clients is Northeast Rehab Hospital ("Northeast"), which operates several facilities, including a 16-bed acute care facility in Nashua, New Hampshire.

4. Omnicare is a nationwide provider of pharmaceuticals to nursing homes and other senior care facilities. Northeast's Nashua facility is an Omnicare client.

5. Since 2008, several regulatory matters have come before the Board involving Omnicare, some of which are still being litigated by the Board.

6. In March 2010, Tocco was attending a Massachusetts College of Pharmacy seminar at Gillette Stadium. Tocco approached the Omnicare compliance officer and asked her assistance in getting his client, Northeast, out of its contract with Omnicare. The Omnicare compliance officer informed Tocco that she was not involved in contracts and suggested he talk instead to Omnicare's general manager for New Hampshire. The Omnicare compliance officer contacted the general manager and informed him of Tocco's inquiry. Tocco did not follow-up with the Omnicare general manager.

7. On August 17, 2010, after the conclusion of a Board meeting in Boston, Tocco approached the Omnicare compliance officer this time about extending the contract between Omnicare and Northeast. The compliance officer again advised Tocco to speak with Omnicare's general manager for New Hampshire, however, Tocco expressed his unwillingness to do so. No further action was taken by Tocco with Omnicare personnel concerning this matter.

8. The Omnicare compliance officer did not feel pressured by Tocco concerning the two above-described conversations; however, the employee felt that Tocco's actions were inappropriate because Omnicare had matters before the Board at these times and Tocco was, at these times, a Board member.

Conclusions of Law

9. As a Board member, Tocco is a state employee as defined by G.L. c. 268A, § 1.

10. Section 23(b)(2)(ii) of G.L. c. 268A prohibits a state employee from, knowingly, or with reason to know, using or attempting to use his official position to secure for himself or others unwarranted privileges or exemptions which are of substantial value and which are not properly available to similarly situated individuals.

11. Tocco twice requested assistance from the Omnicare compliance officer regarding contracts involving Northeast and Omnicare when Omnicare was and would be subject to his regulatory authority as a Board member concerning pending matters. Under the circumstances, Tocco knew or had reason to know that he was using or attempting to use his Board member position to obtain the assistance he wanted.

12. The requested assistance would benefit Tocco's company IPS and/or its client Northeast because it would provide them with an advantage in their attempts to re-negotiate contract terms with Omnicare. This advantage was a privilege within the meaning of G.L. c. 268A, § 23(b)(2)(ii) and was of substantial value in that the contracts were significant. The advantage was unwarranted and not properly available to similarly situated individuals because neither IPS nor Northeast has any right to have a Board member intervene on its behalf with Omnicare concerning contract terms while Omnicare had matters pending before the Board.

13. Therefore, Tocco, by this above-described conduct, knowingly or with reason to know, used or attempted to use his official position to secure for IPS and/or Northeast an unwarranted privilege of substantial value which was not properly available to similarly situated individuals.[1]  In so doing, Tocco twice violated G.L. c. 268A, § 23(b)(2)(ii).

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

(1) that Tocco pay to the Commonwealth of Massachusetts, with such payment delivered to the Commission, the sum of $2,000 as a civil penalty for violating G.L. c. 268A, § 23(b)(2)(ii); and

(2) that Tocco waive all rights to contest, in this or any other administrative or judicial proceeding to which the Commission is or may be a party, the findings of fact, conclusions of law and terms and conditions contained in this Agreement.

[1] The fact that Tocco may not have intended for his conduct to be perceived as an attempt to use his official position to secure any such unwarranted advantage is not the test here. Section 23(b)(2)(ii) of G.L. c. 268A embodies an objective test by which a public employee's conduct is judged by what the employee knew or had reason to know at the time of his conduct. See In re Galewski, 1991 SEC 504; In re Singleton, 1990 SEC 476. Thus, as long as he had reason to know his conduct would or could be so perceived there is a violation regardless of his lack of intent.