of 216
IN THE CIRCUIT COURT
OF LEE COUNTY, ALABAMA
STATE OF ALABAMA )
)
)
)
v. ) CASE NO. CC-2014-000565
)
)
MICHAEL GREGORY HUBBARD, )
)
Defendant. )
STATES RESPONSE TO HUBBARDS MOTION TO DISMISS
CHALLENGING THE CONSTITUTIONALITY OF
THE ALABAMA ETHICS ACT
ELECTRONICALLY FILED9/21/2015 4:40 PM
43-CC-2014-000565.00CIRCUIT COURT OF
LEE COUNTY, ALABAMAMARY B. ROBERSON, CLERK
DOCUMENT 369
i
TABLE OF CONTENTS
INTRODUCTION ............................................................................................................... 1
BACKGROUND FACTS ................................................................................................... 3
ARGUMENT ...................................................................................................................... 7
I. Hubbards Legal Challenges to the Ethics Act Fail. ............................................................... 7
A. The Alabama Ethics Act is not unconstitutionally vague because it clearly gives
notice of the conduct that is prohibited. ........................................................................... 7
B. The Rule of Lenity Does Not Apply Here. .................................................................... 10
C. The Ethics Act Is Not Overbroad. .................................................................................. 12
II. Hubbards Challenges to Counts I-IV of the Indictment Fail Because the Ethics Act Can and Should Be Applied to State Party Chairs and Vice Chairs to Prevent Them
From Converting Money Given to Support Political Parties and/or Campaigns to
their Own Personal Benefit. .................................................................................................. 16
III. Hubbards Arguments Related to Counts 5-23 of the Indictment are Improper Pretrial Sufficiency-of-the-Evidence Challenges or Arguments Concerning Mixed
Questions of Fact and Law. Either Way, These Issues Are Properly Determined, If at
All, at Trial by a Jury. ............................................................................................................ 21
A. Counts 5 and 6 charging Hubbard with voting for legislation that would have
resulted in his client APCI being the sole PBM for Medicaid in Alabama, a clear
conflict of interest, and with receiving $5,000 per month from APCI are legally
sufficient. ....................................................................................................................... 24
i. Although it is ultimately a question to be decided by a jury, under Count 5,
Hubbard had a conflict of interest when, while being paid $5,000 per
month by APCI, he voted on a budget with language APCI drafted which
was designed to make APCI the sole PBM for Alabama Medicaid. ...................... 26
ii. The non-binding Todd opinion does not provide Hubbard a defense to
Count 5 since it was issued years after Hubbard entered into the contract
with APCI meaning he could not have relied upon it in taking the actions
he took, and is clearly distinguishable. In any event, Hubbards arguments involve mixed questions of fact and law which can only be decided at trial. ........ 30
DOCUMENT 369
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TABLE OF CONTENTS (continued)
iii. The non-binding Ross opinion does not provide Hubbard a defense to
Count 6 because it, like the Todd Opinion, was issued years after Hubbard
entered into the contract with APCI meaning he could not rely upon it in
taking the actions he took, and is clearly distinguishable. In any event,
Hubbards arguments involve mixed questions of fact and law which can only be decided at trial. .......................................................................................... 32
B. Counts 79 charging Hubbard with using his office to obtain personal gain, namely $12,000 per month, from SEAGD and lobbying the Governor and
Department of Commerce on SEAGDs behalf are legally sufficient. .......................... 34
i. Hubbards arguments that he complied with the terms of the letter from the Ethics Commission present factual questions for a jury to decide. ........................ 37
ii. Hubbards self-serving argument that he has a fundamental right to lobby, or more accurately a fundamental right to get rich lobbying while serving
as a public official, is absurd and wholly ignores the rights and interests of
his constituents, other public officials who do not seek to use public office
to get rich, and the people of the State of Alabama. .............................................. 38
C. Count 10 charging Hubbard with accepting a thing of value from Edgenuity, a
principal, is legally sufficient. ........................................................................................ 43
i. Hubbards construction of the pays full value exception would transform it into the they got a good deal exception, an exception that would swallow the rule. ..................................................................................................... 47
ii. Since the circumstances do not make it clear that Edgenuity compensated
Hubbard for reasons unrelated to his service as a public official, especially
since Edgenuity listed him as its contact for House Speakers in all 50 States
and he secured a contract for it by calling the Speaker of South Carolina,
the non-governmental business exception does not apply. .................................... 48
D. Counts 11 through 14 charging Hubbard with using his office for personal gain
by accepting money from Robert Abrams, representing Abrams and his
businesses before the Governor and Secretary of Commerce, and using state
resources to benefit himself and Abrams are legally sufficient. .................................... 50
E. Counts 1519 charging Hubbard with soliciting or receiving investments in his failing business from lobbyists and principals are legally sufficient. ............................ 59
DOCUMENT 369
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TABLE OF CONTENTS (continued)
i. The Craftmaster investments are not exempted from being things of value under the non-governmental business activities exception to the Ethics Act because Hubbard repeatedly emphasized they were necessary
for him to keep his Speakership and avoid political ruin. ...................................... 66
ii. The application of the pays full value exception of the Ethics Act to the Craftmaster scheme created by Brooke because Hubbard could not obtain
financing for Craftmaster due to a previous bankruptcy and on-going cash
flow problems is a fact question that must be determined, if at all, by a jury. ....... 67
iii. Brooke, Rane, and Burton are principals under the Ethics Act because they
are high-level executives with decision making authority in corporations
that employ lobbyists.............................................................................................. 68
F. Counts 2023 charging Hubbard with accepting things of value from lobbyists Bob Riley, Minda Riley Campbell, William Canary, and BCA principal Will
Brooke are legally sufficient. ......................................................................................... 70
i. Hubbards emails with Riley, Campbell, Canary, and Brooke demonstrate that they did not assist him in finding clients solely out of friendship. .................. 84
ii. The assistance in finding clients that Riley, Campbell, Canary, and Brooke
provided to Hubbard clearly qualifies as a thing of value since it is a gift, benefit, favor, service or other item of monetary value. ........................ 85
CONCLUSION ................................................................................................................. 86
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1
INTRODUCTION
Just nine months after the effective date of the Ethics Law1 amendments
passed during the 2010 special legislative session, Speaker Mike Hubbard, the
defendant in this case, complained to former Governor Bob Riley that he wanted to
be hired by the lobbying firm Riley opened after leaving office [e]xcept for those
ethics laws. Who proposed those things?! What were we thinking? AG0670566,
attached as Exhibit 64A to States February 27, 2015 Response to Hubbards
Motion for More Definite Statement (Feb. 27th 2015 Response). While we dont
know what every legislator who voted on the laws was thinking, based on his
Motion to Dismiss: Unconstitutionality of the Alabama Ethics Act filed August 21,
2015, it is clear that Hubbard was thinking that the ethics laws he designed and
shepherded through to passage would not apply to him or to his multiple-
thousands-of-dollars-per-month consulting contracts because those very laws were
unconstitutional. See Motion at 5 (Michael G. Hubbard , by and through the
undersigned counsel, hereby petitions this Court to enter an order dismissing the
indictment based on the unconstitutionality of the Alabama Ethics Act, Ala.
Code 36-25-1 et seq. ) (emphasis added).
In other words, Hubbard believed the laws to be great politically because
they helped his party take over the Alabama Legislature, and great legally because
1 In this brief, the State refers to the Alabama Ethics Act, Ala. Code 36-25-1 et seq., as
the Ethics Act or the Ethics Law.
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they would have no legal effect. Without effect, those laws could not be used to
stop him from personally benefiting from his elected position to the tune of tens of
thousands of dollars per month for representing the interests of a select few willing
to pay that priceon top of the salary he received from the state treasury for,
ostensibly, representing the interests of all Alabamians and those in his legislative
district. See Inside Alabama Politics, Volume 30, Number 19, August 3, 2015
(quoting Mark White as saying Speaker Hubbards support of the Alabama Ethics
Law hed voted for had been politicalnot legal,).
Strikingly, Hubbard does not deny in his Motion that he did any of the
things alleged in the indictment. See also Kim Chandler, Indicted House Speaker
Challenges Ethics Law; Says It Doesnt Apply to Him, The Republic, Sept. 11,
20152 (quoting Mark White as saying Everything the speaker did was entirely
appropriate.). It is also notable that the actions charged in the indictment began as
soon as the law went into effect in early 2011 meaning Hubbard had no hesitation
in taking the actions that he took. Instead, his argument is that he should get away
with doing all of them, including lining his pockets with millions of dollars while
he was state GOP chair and House Speaker, because, according to him, he has a
constitutional right to funnel party money to businesses he controls and to get paid
2 Available at:
http://m.therepublic.com/view/story/5c0b3cd4a58d4d679d90d0e163e534f2/AL--Indicted-
Speaker-Ethics-Challenge.
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tens of thousands of dollars each month by private interests on top of his legislative
salary for performing the job which the voters of House District 79 and his fellow
House members elected him to do.
The logical result of his arguments is that any law that infringes on a public
officials ability to receive (a very large) something extra on the side from
private interests willing to pay that person for performing their official duties is
unconstitutional. The Ethics Law expressly prohibits such blatant corruption
which is why Hubbard now seeks to invalidate it even though it was a key reason
he was elected Speaker and was the central focus of Hubbards war on
corruption campaign in order to restore the publics trust in government.3 As
the State demonstrates below, Hubbards extreme self-serving attacks on the Ethics
Law fail.
BACKGROUND FACTS
Ironically, the Ethics Act that Hubbard now seeks to overturn was a key
reason why he was elected Speaker. During the 2010 election cycle, Hubbard,
then the Alabama Republican Party Chairman, engineered a campaign strategy to
end 136 years of Democratic control of the State Legislature. This strategy
centered on the Hubbard designed Republican Handshake with Alabama, which
3 Republicans say Davis a latecomer on his ethics plan, Sebastian Kitchen,
MONTGOMERY ADVERTISER, April 10, 2009, available at:
http://southunionstreet.blogspot.com/2009_04_01_archive.html.
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aimed to, among other things, implement reforms to the Alabama Ethics Act,
36-25-1, et seq. Ala. Code (1975). GOP Chairman Hubbard explained that these
reforms were not possible unless and until the Republicans obtained a majority in
the Legislature:
Thankfully, Gov. Bob Riley and Republicans in the Legislature have
already proposed substantive anti-corruption legislation. The war on corruption has many enemies, but Republicans are committed to
the fight and we are determined to restore the publics trust in government. Unfortunately, Democrats will not allow our anti-
corruption bills to pass therefore a Republican majority is the only way for true ethics reform to become a reality in Alabama.
Republicans say Davis a latecomer on his ethics plan, Sebastian Kitchen,
MONTGOMERY ADVERTISER, April 10, 2009; see also It's Easy to Tell Who
REALLY Supports Ethics Reform...And Who DOESN'T!, Mike Hubbard, January
6, 2010 (During this 2010 election cycle, I urge you to vote to put Republicans in
office so we can implement the reforms that the Democrats refuse to seriously
consider. It is the only way to combat corruption and implement the ethics statues
our state has needed for too long.).4
Unveiled a few months before the 2010 election, the Handshake with
Alabama agenda made specific campaign promises focused on Ending
Corruption in Montgomery. GOP Chairman Hubbard claimed that if Republicans
were able to obtain majority control of the Legislature, then the Ethics Laws would
4 Available at: https://auburnrepro.com/Articles/Article.aspx?ai=34.
DOCUMENT 369
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be reformed in response to recent corruption scandals involving Democrats.
Legislative leaders unveil 2010 Republican Handshake with Alabama, Hank
Richards, EXAMINER.COM, August 17, 2010.5
In his book, Storming the State House, Hubbard elaborated on the
corruption cases involving Democrats and how these criminal prosecutions played
a key role in the 2010 election cycle and the subsequent passage of changes to the
Ethics Law. See Hubbard, Mike, Storming the State House, The Campaign that
Liberated Alabama from 136 Years of Democrat Rule, pp. 169-70, New South
Books, 2012 (There is no doubt the Democrats long history of corruption and the
fact that their legislative leadership consistently killed Republican-sponsored ethics
reform proposals would be a central focus during Campaign 2010.); see also id. at
p. 289 (Because of the laws passed in the special session and proudly signed into
law by Governor Riley, Alabama ethics laws are now among the strongest in the
nation. I firmly believe the dramatic reforms will be an important part of
Governor Rileys legacy. It is my hope that future historians will say that this was
the legislature that brought the reforms Alabama had needed for so long and that
fundamentally changed how state government operates.)
5 Available at: http://www.examiner.com/article/legislative-leaders-unveil-2010-
republican-handshake-with-alabama.
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Shortly after Republicans obtained their new majority in the Legislature,
then-Governor Bob Riley called a special session to pass reforms to the Ethics
Act.6 The Legislature then passed numerous changes to the Ethics Act, which
Governor Riley signed into law.7 These changes included two new provisions to
the Ethics Act.8 First, Section 36-25-1.1 was added, which prohibits members of
the Legislature from lobbying executive departments or agencies for money. See
Indictment, Counts 8-9, 12-13 (charging Hubbard with being paid by the Southeast
Alabama Gas District and Bobby Abrams businesses to illegally lobby the
Governors Office and Secretary of Commerce). Second, Section 36-25-5.1 was
added, which prohibits public officials from soliciting or receiving things of value
from lobbyists and principals. See Indictment, Counts 6, 10, 15-23) (charging
Hubbard with soliciting or receiving lobbyists and principals for things of value,
including $600,000 in Craftmaster investments and approximately $525,000 in
consulting contract payments).
6 Alabama special session on ethics to begin today, Kim Chandler, AL.COM, December
8, 2010, available at:
http://blog.al.com/spotnews/2010/12/alabama_special_session_on_eth.html.
7 Alabama Gov. Bob Riley signs seven bills on ethics and campaign finance, David
White, AL.COM, December 20, 2010, available at:
http://blog.al.com/spotnews/2010/12/hold_for_daves_call_alabama_go.html.
8 In addition to the new provisions, changes were also made to 36-25-1, 2, 3, 4, 7, and
27.
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Shortly after they were passed, Hubbard explained that these new provisions
were enacted to limit the influence of lobbyists: This place used to be run by
lobbyists. Now, it is run by lawmakers, and that's how it ought to be. There's no
question the stricter laws are a big reason for that.9 Less than four years later,
Hubbard now claims these and other provisions of the Ethics Act are
unconstitutional because they infringe on his fundamental constitutional right to be
a well-paid lobbyist and lawmaker at the same time. See Hubbards Motion to
Dismiss, at p. 31.
ARGUMENT
I. Hubbards Legal Challenges to the Ethics Act Fail.
A. The Alabama Ethics Act is not unconstitutionally vague because it
clearly gives notice of the conduct that is prohibited.
Hubbards first attack on the Ethics Act that he previously characterized as
being first in the nation10 is that it is unconstitutionally vague meaning it was
so poorly drafted by the Legislature he leads that it fails to give notice of what
9 Alabama's new ethics law fails to stop exemption requests from lobbyists and public
officials, Kim Chandler, AL.COM, November 6, 2011, available at: http://blog.al.com/spotnews/2011/11/alabamas_new_ethics_law_fails.html.; see also Hubbard,
supra p. 5, at p. 286 ([S]trengthening the ethics law would send a loud and clear message to the people of Alabama, and to the special interest groups that had run Montgomery for decades,
that things would be different from here on out.)
10 Alabama Voices: Legislature took historic steps in special session, Mike Hubbard,
MONTGOMERY ADVERTISER, December 18, 2010, available at:
http://archive.montgomeryadvertiser.com/article/20101219/OPINION0101/12190304/Alabama-
Voices-Legislature-took-historic-steps-special-session.
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conduct it prohibits. Motion at 5-6. As shown below, however, the Ethics Act is
not unconstitutionally vague.
The vagueness doctrine protects a defendants Fourteenth Amendment due
process rights against prosecution under a statute that contains insufficient
warning of what conduct is unlawful. Hicks v. State, 153 So. 3d 53, 64 (Ala.
2014) (internal quotation marks omitted); see also United States v. Hariss, 347
U.S. 612, 61718 (1954). The doctrine means that if a person could not
reasonably understand that his contemplated conduct is proscribed, he cannot be
criminally liable. Hicks, 153 So. 3d at 53. The vagueness doctrine protects against
statutes that fail to give adequate notice of how to avoid their penalties, are not
sufficiently focused to warn citizens of their reach and coverage, and may trap
the innocent by not providing fair warning. Id. In other words, a statute does not
violate the Fourteenth Amendments due process clause if it gives fair notice to
ordinary people of what conduct is unlawful.
Even when a statute could have been drafted more precisely or when it has
some inherent vagueness, it can still pass constitutional muster. Id. at 65 (internal
quotation marks omitted). The fact that a statute has more than one reasonable
interpretation does not make it vague. Id. Otherwise, there would be no need for
canons of statutory construction. Instead, courts should only invalidate a statute
under the vagueness doctrine if it is so incomplete, so irreconcilably conflicting,
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or so vague or indefinite, that it cannot be executed, and the court is unable, by the
application of known and accepted rules of construction, to determine, with any
reasonable degree of certainty, what the legislature intended. Id. (internal
quotation marks omitted).
Hubbard fails to show that Sections 36-25-5(a), (b), and (c); 36-25-5.1(a);
and 36-25-1.1 of the Ethics Act, the statutes he is charged with violating, are
unconstitutionally vague. Indeed, the vagueness section in his Motion merely
recites vagueness law principles without offering any explanation as to how they
apply to these statutes. The reason for his lack of explanation is obvious: all of
these statutes provide clear notice that the actions that form the basis for the
charges against him, actions that he does not dispute he took, are prohibited under
the Ethics Act. Indeed, vagueness challenges to the Ethics Act have repeatedly
been rejected by Alabamas appellate courts. See State v. Turner, 96 So. 3d 876,
880-82 (Ala. Crim. App. 2011) (reversing trial courts judgment that Ala. Code
36-25-5(a) is unconstitutionally vague); Hunt v. State, 642 So. 2d 999, 1026-29
(Ala. Crim. App. 1993) (rejecting claim that prior version of Ala. Code 36-25-
5(a) was unconstitutionally vague); see also Hunt v. Tucker, 875 F. Supp. 1487,
1517-18 (N.D. Ala. 1995), affd 93 F.3d 735 (11th Cir. 1996) (same); Hunt v.
Anderson, 794 F. Supp. 1557, 1564 (M.D. Ala. 1992), affd 976 F.2d 744 (11th
Cir. 1992) (same); Dill v. State, 723 So. 2d 787, 809-10 (Ala. Crim. App. 1998)
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(rejecting argument that Alabama Ethics Act is unconstitutionally vague and
noting that [t]he constitutionality of the Ethics Act . . . has repeatedly been
upheld. (citing Comer v. City of Mobile, 337 So. 2d 742, 750 (Ala. 1976);
Langham v. State, 662 So. 2d 1201, 1206-07 (Ala. Crim. App. 1994)). Hubbard
offers no reason for this Court to deviate from those holdings.
B. The Rule of Lenity Does Not Apply Here.
Although he does not explain how it would impact his case, Hubbard asserts
that the canon of statutory construction known as the rule of lenity applies and
requires the Court to construe the Ethics Act narrowly. Motion at 6-8. But the rule
of lenity is not a get-out-of-prosecution-free card. It is a canon of statutory
construction that applies only when a statute is ambiguous and other canons of
statutory construction do not resolve that ambiguity. See Kasten v. Saint-Gobain
Performance Plastics Corp., 131 S. Ct. 1325, 1336 (2011). That is, to show the
rule of lenity applies, Hubbard must show that the Ethics Act he and his fellow
legislators passed is so ambiguous that no matter what rules of statutory
interpretation are used, it remains unclear.
Thus, for the rule of lenity to apply in the first place, there must be actual
statutory ambiguity. In determining whether the Ethics Act is ambiguous, the
Court is not required to abandon common sense. Hicks, 153 So. 3d at 5859.
Rather, when interpreting criminal statutes, courts should give statutory words
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their ordinary meaningthis is the first and foremost canon of statutory
construction. Ex parte Pate, 145 So. 3d 733, 738 (Ala. 2013). In so doing, courts
should also ascertain and effectuate legislative intent expressed in the statute,
which may be gleaned from the language used, the reason and necessity for the act,
and the purpose sought to be obtained. Id.
As explained above, the sections of the Ethics Act that Hubbard is charged
with violating are not vague. Nor does Hubbard demonstrate that they are
ambiguous. Their ordinary meaning gives notice to public officials and employees
that conduct of the type Hubbard is charged with committing is prohibiteda fact
recognized by this Court in its recent Order denying the defendants Motion for
More Definite Statement. See September 4, 2015 Order. And the legislative
intent, expressed in the statute, reflects that the Ethics Act exists because public
officials should be independent and impartial, governmental actions should be
taken through the governmental structure, [n]o public office should be used for
private gain, public confidence in the integrity of government is important, and
the public interest requires appropriate ethical standards to govern public officials
and employees. Ala. Code 36-25-2(a). These statements of legislative intent are
consistent with the States recognized strong interest in preventing corruption or
the appearance of corruption, and the way the statutes are being applied to
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Hubbards conduct as charged in this case. See Fed. Election Commn v. Natl
Conservative Political Action Committee, 470 U.S. 480, 49697 (1985).
Accordingly, since the statutes Hubbard is charged with violating are clear,
and their application to Hubbard in this case furthers the legislative intent
underlying their passage and the States strong interest in preventing corruption or
the appearance of corruption, the rule of lenity does not apply in this case.
C. The Ethics Act Is Not Overbroad.
Hubbards argument that the Ethics Act is unconstitutionally overbroad
because it infringes on his so-called First Amendment right to lobby while serving
as a public official is not only legally deficient, but also would repeal virtually all
of the Ethics Act, since its basic point is that public officials can never be stopped
from being paid to lobby for private interests while holding public office.11
Motion
at 810. In other words, Hubbards overbreadth argument is itself so overbroad
that it would undo not only the amendments to the Ethics Act he shepherded
through the Legislature but all laws designed to prevent public officials from being
11
Under the logic of Hubbards argument, no limitations could be imposed on the ability of private interests to give public officials things of value to secure a public officials time and attention meaning that the provisions of the Ethics Act limiting lobbyists to spending $25 per
meal and $150 per year and principals to spending $50 per meal and $250 per year on a public
officialcornerstones of the ethics reforms Hubbard spearheadedwould also be written out of the Ethics Act as unconstitutional. See Mike Hubbard, Alabama Voices: Legislature took historic steps in special session, MONTGOMERY ADVERTISER, December 18, 2010. (Legislation that lowered the amount lobbyists and their clients may spend on entertaining public officials
from $250 a day to $250 a year, a dramatic decrease which will lessen special interest influence
on the political process.).
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influenced by outside entities who give them things up to and including tens of
thousands of dollars every month.
An examination of the overbreadth doctrine reveals that it clearly cannot be
used to shield corruption as Hubbard argues it should. The overbreadth doctrine is
an exception to the typical rule that someone challenging a statute as facially
unconstitutional must show that there is no set of circumstances under which the
application of the statute would be valid. Fla. Assn of Professional Lobbyists, Inc.
v. Div. of Legislative Info. Servs., 525 F.3d 1073, 1079 n.7 (11th Cir. 2008). A law
is overbroad if, instead of aiming specifically at evils the State can control, it
reaches activities that typically constitute protected speech. Id. at 1079.
The Alabama Supreme Court has explained that the overbreadth doctrine
voids statutes and regulations that achieve their object by sweep[ing]
unnecessarily broadly and thereby invad[ing] the area of protected freedoms.
Westphal v. Northcutt, ___ So. 3d ___, 2015 WL 3537484, *8 (Ala. 2015) (internal
quotation marks omitted). The relevant question is whether the Legislature could
have accomplished its goals with a more narrowly tailored law that does not
broadly stifle fundamental personal liberties, most often those protected by the
First Amendment. Id. In the First Amendment context, courts should evaluate the
challenged statutes possible direct and indirect burdens on speech, and only
invalidate a law that inhibit[s] the exercise of First Amendment rights if the
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impermissible applications of the law are substantial when judged in relation to the
statutes plainly legitimate sweep. Butler v. Ala. Judicial Inquiry Commn, 802
So. 2d 207, 213 (Ala. 2001); see also Dowling v. Ala. State Bar, 539 So. 2d 149,
151 (Ala. 1988).
Hubbard has not shown that any portion of the Ethics Act is
unconstitutionally overbroad. Nor could he, since the Ethics Act is carefully
tailored to prevent public officials from being influenced to act contrary to their
obligations of office by the prospect of financial gain to themselves or infusions of
money into their campaigns, Fed. Election Commn, 470 U.S. at 497, without
infringing on constitutionally protected speech. The Ethics Act does not prohibit
public officials from listening to constituents, private interests, or even lobbyists.
It also does not prohibit constituents, private interests, or lobbyists from
communicating with public officials. The Ethics Act similarly does not prohibit
public officials from lobbying each other on particular issues as part of their
official duties.
Instead, the Ethics Act prevents public officials from being paid tens of
thousands of dollars per month over and above their legislative salaries to lobby on
behalf of private interests in the guise of performing their official duties. The
Constitution does not give public officials the right to enrich themselves by
accepting substantial compensation from private interests in exchange for insuring
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that those private interests receive red carpet lobbying treatment. Nor does the
Constitution give public officials the right to only hear the voices of paying
interests while ignoring the voices and concerns of ordinary people who only pay
public servants through taxpayer funded legislative salaries. Boiled down to its
essence, Hubbards argument is that he has a constitutional right to be a legislator
lobbyist, or perhaps a lobbyist legislator, who earns an extremely handsome living
by catering to the interests of his powerful lobbying clients and using his public
position to advance their goals ahead of those of the average citizens who elected
him to that position.12
Unsurprisingly, no court has adopted Hubbards untenable position that
would gut the notion of representative democracy and shake the foundations of
good government to their core. The Ethics Act uses reasonable means to prohibit
public officials from using their office for personal gain. Likewise, the law serves
to achieve the legitimate and compelling interests of ensuring that the voices of the
people are not drowned out by the voices of the powerful few, and that public
officials elected by the people actually represent the peoples interests. Clearly,
then, the Ethics Act does not chill any protected speech so as to prevent a public
official from exercising his First Amendment free speech rights. Rather, it is
12
If Hubbard truly believed he was exercising his First Amendment right to lobby when
he violated the Ethics Laws, he could at least have registered as a lobbyist so his lobbying
clients, constituents, fellow legislators, and other public officials would know it. Ala. Code 36-
25-18 to -19.
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carefullyand wiselydesigned to prevent, deter, and punish those who would
abuse their public position for personal enrichment.
II. Hubbards Challenges to Counts I-IV of the Indictment Fail Because the Ethics Act Can and Should Be Applied to State Party Chairs and
Vice Chairs to Prevent Them From Converting Money Given to
Support Political Parties and/or Campaigns to their Own Personal
Benefit.
In the first four counts of the indictment, the grand jury charged Hubbard
with using his position as Chairman of the Alabama Republican Party to obtain
personal gain for himself and his businesses. Hubbard does not dispute that he and
his businesses did in fact benefit from his position as Chairman. See Feb. 27th
2015 Response at 7-10 (detailing how Hubbard used his position as Chairman to
funnel approximately $1,012,444.00 in ALGOP money to his printing and media
businesses both directly and through intermediaries). Instead, he twists and
distorts the Ethics Act to manufacture an argument that it cannot be applied to state
political party chairs and vice-chairs. Motion at 10-16. Hubbards argument fails,
however, and this case illustrates why the Ethics Act can and should be applied to
political party chairs and vice chairs in order to prevent them from converting
money raised to support political parties and/or campaigns for their own personal
benefit.
Hubbards argument consists largely of straw men that misread the clear
provisions of the Act. For example, Hubbard argues that, because the Alabama
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Republican Executive Committee and the ALGOP are businesses with which the
party chair and vice chair are associated, the Ethics Act criminalizes them using
their official positions to obtain personal gain for those businesses. Motion at 12-
14. The Ethics Act does no such thing since it explains that [p]ersonal gain is
achieved when the public official, public employee, or a family member thereof
receives, obtains, exerts control over, or otherwise converts to personal use the
object constituting such personal gain. Ala. Code 36-25-5(a) (emphasis added).
In other words, this provision of the Ethics Act does not prohibit party chairs and
vice chairs from using their positions to benefit the Alabama Republican Executive
Committee or the ALGOP; all it does is prevent chairs and vice chairs from
converting party money to personal benefit as Hubbard did to the tune of over one
million dollars when he was ALGOP Chair.
Similarly, Hubbards discussions of Sections 36-25-5(c) and 36-25-8 are
smokescreens designed to deflect attention away from his misuse of his position as
ALGOP chair. Motion at 13. As an initial matter, Hubbard is not charged with
violating either of these provisions as ALGOP chair, which means they are
irrelevant to the present proceeding. Setting aside their irrelevance, an
examination of them reveals, yet again, that Hubbard distorts their language to
support his failing argument. Section 36-25-5(c) prohibits public officials from
using or causing to be used equipment, facilities, time, materials, human labor, or
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other public property under his or her discretion or control for the private benefit or
business benefit of the public official, public employee, any other person, or
principal campaign committee, which would materially affect his or her
financial interest. (emphasis added); see also Count 14 (charging Hubbard with
illegally using state resources under his discretion for the benefit of himself and
Bobby Abrams businesses) . In other words, party chairs and vice chairs are free
to use equipment, facilities, time, etc., to benefit their political parties candidates,
but not to personally enrich themselves.
The other provision Hubbard cites, Section 36-25-8, prohibits public
officials from using or disclosing confidential information gained by virtue of
their public position in any way that could result in financial gain other than his or
her regular salary as such public official or public employee for himself or herself,
a family member of the public employee or family member of the public official,
or for any other person or business. Elsewhere, the Ethics Act defines
confidential information to mean [a] complaint filed pursuant to this chapter,
together with any statement, conversations, knowledge of evidence, or information
received from the complainant, witness, or other person related to such complaint.
Ala. Code 36-25-1(7). In other words, Section 36-25-8 is narrow in scope
meaning Hubbards attempt to broadly construe it fails.
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19
Besides his easily refuted straw men, the only other arguments Hubbard
raises against the applicability of the Ethics Act to party chairs and vice chairs is
that it infringes on the officials and their parties First Amendment rights of
association and free speech. Hubbard claims it infringes on the right of association
because it purports to establish rules governing a political partys internal affairs
by prohibiting its chairs and vice-chairs from engaging in particular conduct.
Motion at 14. Of course, the only thing the Ethics Act prohibits is party chairs or
vice chairs from using their position and party money for personal gain, a
prohibition that is clearly consistent with the States recognized strong interest in
preventing corruption or the appearance of corruption. See Fed. Election Commn
470 U.S. 480, 49697 (1985).
Hubbards related argument that the application of the Ethics Act to party
chairs or vice chairs violates their right to free speech fails for the same reason that
his associational rights argument fails. The Ethics Act does not prohibit or
otherwise regulate a political partys expenditure of funds, except to prevent party
chairs or vice chairs from converting the funds for personal gain. Hubbards claim
that the First Amendment protects the manner in which political parties choose to
use their privately raised funds is true up to a point, but, just as the First
Amendment does not protect a political parties right to use privately raised funds
to commit voter fraud, bribery, or any number of other criminal offenses, neither
DOCUMENT 369
20
does it protect the rights of party chairs or vice chairs to enrich themselves using
party funds.13
See Dun & Bradstreet, Inc. v. Greenmoss Bldrs., Inc., 472 U.S. 749
(1985) (plurality opinion) ([S]peech on matters of purely private concern is of less
First Amendment concern.).
In sum, Hubbard is not charged with using his office as party chair to benefit
the Alabama Republican Party. He is charged with using his position as chairman
to obtain personal gain by funneling party money to his own businesses. The
charges against Hubbard are unrelated to the Alabama Republican Party, except
insofar as he illegally converted Party money for his personal gain. Neither the
Ethics Act, nor the State through this prosecution, seeks to influence how political
parties organize or govern themselves, or how they choose to lawfully spend funds
they raise. Instead, the Ethics Act and this prosecution are focused on ensuring
that party chairs and vice chairs do not abuse their position by illegal converting
13
To the extent Hubbards arguments rest on a notion that party chairs and vice chairs should not be classified as public officials, the State notes that the Alabama Legislature correctly and properly brought such persons within the ambit of the Ethics Act, as those persons
exercise broad and important public powers affecting the citizenry at large. For example, only
political parties as defined by law generally, parties receiving 20 percent of the general election vote or submitting a list of signatures of at least three percent of the voters (a definition that
clearly includes the ALGOP) are eligible for ballot access on a party basis. Ala. Code 17-6-22 & 17-13-40. A partys candidates do not make it on the ballot, however, unless they are certified by the party chair. Ala. Code 17-6-21(a) & 17-9-3. And the party can actually
disqualify such a candidate, or the candidate could withdraw, and if that happens too close to
election day, the persons name would remain on the ballot but none of the votes cast in their favor would count. Ala. Code 17-6-21(b). Instead, even though citizens would have gone to the
polls and voted overwhelmingly in favor of that person, the party would have the power to hand
pick a different unelected person to take office. Id. In this way, pre-election, party officials effectively exercise the appointment powers the governor would exercise post-election.
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21
party money to their own personal benefit as Hubbard did when he was chairman
of the Alabama Republican Party.14
III. Hubbards Arguments Related to Counts 5-23 of the Indictment are Improper Pretrial Sufficiency-of-the-Evidence Challenges or
Arguments Concerning Mixed Questions of Fact and Law. Either
Way, These Issues Are Properly Determined, If at All, at Trial by a
Jury.
Hubbards arguments related to Counts 5-23 of the indictment are nothing
more than sufficiency-of-the-evidence challenges or arguments concerning mixed
questions of fact and law. In either instance, they are issues to be determined, if at
all, by the jury at trial. Since they are not purely legal questions, then they have
nothing to do with whether the indictment is legally sufficient under Ala. R. Crim.
P. 13.5(c)(1).
Under Alabama law, an indictment is legally sufficient if it tracks the
language of the statute. State v. Davis, 2015 WL 3448085, at *2 (Ala. Crim. App.
May 29, 2015) (Thus, [a]n indictment is sufficient if it charges an offense in the
language of a statute, and it need not set up proof necessary to a conviction. Ex
parte Behel, 397 So. 2d at 165 (citing Finley v. State, 181 So. 123 (1938)). . . .
14
As an additional matter, Hubbards argument that ALGOP is a business with which Hubbard is associated makes no sense. His position as ALGOP chair made him a public official
under the Ethics Law, just like his position as a State Representative does. The Legislature is no
more a business with which Hubbard is associated than the Alabama Republican Party. All 23
Counts charge Hubbard with benefiting himself, Craftmaster, or Auburn Network, both of which
are undisputedly businesses with which Hubbard is associated. See Motion at 8 (Since Hubbard is an owner of Craftmaster and the Auburn Network, both qualify as a business with which
Hubbard is associated.).
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22
The particulars as to manner, means, place or circumstances [of the offense]
need not in general be added to the statutory definition. Smith v. State, 797 So.
2d 503, 514 (Ala. Crim. App. 2000) (quoting People v. Soto, 141 Cal. Rptr. 343,
346 (1977), quoting in turn People v. Britton, 56 P. 2d 494, 496 (1936))); see also
State v. Walker, No. CR-14-0765 (Ala. Crim. App. Sept. 18, 2015) (Slip. Op.) at 5
(reversing dismissal of indictment and finding indictment could not be dismissed
under Rule 13.5(c)(1) as insufficient or as failing to charge an offense when it
charged an offense and tracked the language of the statute defining the offense,
which prescribes with definiteness the essential elements of the offense.). This
Court has already determined the indictment is legally sufficient when it issued its
order denying the motion for more definite statement. See September 4, 2015
Order, at pp. 1-3. Hubbards arguments related to Counts 5-23 provide no reason
for this Court to reconsider that ruling.
Even though Hubbard couches his arguments directed to Counts 5-23 in
terms of legal sufficiency, his arguments are really improper sufficiency-of-the-
evidence challenges about whether the State can present sufficient evidence to
sustain a conviction. Alabama courts have repeatedly held that Rule 13.5 does not
allow trial courts to dismiss an indictment based on insufficient evidence, or a
possible lack of evidence. State v. McClain, 911 So. 2d 54 (Ala. Crim. App. 2005);
State v. Foster, 935 So. 2d 1216 (Ala. Crim. App. 2005); State v. Robertson, 8 So.
DOCUMENT 369
23
3d 356 (Ala. Crim. App. 2008); State v. Bethel, 55 So. 3d 377 (Ala. Crim. App.
2010). Thus, Hubbards arguments regarding Counts 5-23 are due to be denied
since they raise factual issues related to elements of each offense to be resolved
by a jury. June 13, 2014 Order, State v. Felix Barry Moore, CC-14-226.
The Court may under certain circumstances rule on a pure question of law
before trial, Ankrom v. State, 152 So. 3d 373, 378-79 (Ala. Crim. App. 2011), but,
as demonstrated below, Hubbards challenges raise, at best, mixed questions of law
and fact which are not proper for decision under Ankrom. See State v. Walker, No.
CR-14-0765 (Ala. Crim. App. Sept. 18, 2015) (Slip. Op.) at 7 (reversing dismissal
of indictment and finding Ankrom exception inapplicable because question of
defendants intent did not present the circuit court with a pure question of law, but
rather a mixed question of law and fact that could only be decided by a jury).
All of the challenges Hubbard makes to the sufficiency of the indictment require[]
proof of facts by the State so entwined with the merits of the case that a decision as
to whether [they] ha[ve] been proved should not be made before trial but should be
postponed until trial. State v. Edwards, 590 So. 2d 379, 380 (Ala. Crim. App.
1991).
Hubbard has raised factual issues for the jury to decide and not purely legal
questions for this Court to resolve pretrial. And the facts he discusses are
disputed, making pretrial resolution impossible and premature. As a result, this
DOCUMENT 369
24
Court should consider Hubbards arguments at the conclusion of the States case,
not before trial. The State therefore objects to any pretrial evaluation of the
sufficiency of the States evidence. Equally, the State objects to any pretrial
evidentiary hearing designed to permit this Court to evaluate or determine the
sufficiency of the States evidence. Such a procedure is unavailable under
Alabama as explained above.
The State also objects to Hubbards presentation of facts not in evidence.
While the State declines to make any proffer of the sufficiency of its evidence
before trial, the State has responded to Hubbards factual arguments with selected
documents, illustrating disputed issues of material fact that must be resolved at
trial. In doing so, the State does not invite this Court to resolve any of those
factual issues. This Court should reject Hubbards sufficiency-of-the-evidence
challenges masquerading as sufficiency-of-the-indictment challenges on their face.
All 23 Counts should be tried before a jury and not dismissed.
A. Counts 5 and 6 charging Hubbard with voting for legislation that
would have resulted in his client APCI being the sole PBM for
Medicaid in Alabama, a clear conflict of interest, and with
receiving $5,000 per month from APCI are legally sufficient.
Counts 5 and 6 of the indictment relate to Hubbards interactions with
APCI. Count 5 charges Hubbard with voting for Senate Bill 143 of the 2013
Regular Legislative Session that would have made APCI the sole Pharmacy
Benefit Manager (PBM) for Medicaid in Alabama, a clear conflict of interest, in
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25
violation of Section 36-25-5(b) of the Alabama Code. Count 6 charges Hubbard
with soliciting or receiving a thing of value, namely $5,000 per month, from APCI,
who employed a lobbyist and was therefore a principal under the Ethics Act, in
violation of Section 36-25-5.1(a) of the Alabama Code. Hubbards Motion does
not actually challenge the legal sufficiency of Counts 5 and 6. Motion at 16-24.
Instead, it challenges the sufficiency of the States evidence related to these counts
based on his contention (a) that he did not have a conflict of interest when, while
being paid $5,000 a month by APCI, he voted on a budget that included language
drafted by APCI and submitted for inclusion in the budget by Hubbards chief
legal advisor designed to make APCI the PBM for Alabama Medicaid; (b) that an
advisory opinion from the Ethics Commission to Rep. Patricia Todd related to her
work advocating on behalf of the LGBT community issued years after his contract
with APCI expired validates his actions underlying Count 5; and (c) that an
advisory opinion from the Ethics Commission to Rep. Quinton Ross allowing Ross
to enter into a consulting contract to help Montgomery celebrate and commemorate
the 50th
anniversary of the Selma to Montgomery March issued years after
Hubbards contract with APCI expired validates his actions underlying Count 6.
Since these arguments are evidence-based challenges, they do not permit Hubbard
to avoid trial as a matter of law.
DOCUMENT 369
26
i. Although it is ultimately a question to be decided by a jury, under Count 5, Hubbard had a conflict of interest when,
while being paid $5,000 per month by APCI, he voted on a
budget with language APCI drafted which was designed to
make APCI the sole PBM for Alabama Medicaid.
Between August 2012 and December 2013, APCI paid Hubbard
approximately $95,000 under a consulting contract. See APCI Contract,
AGdoc0107456, attached as Exhibit 10 to States Feb. 27th 2015 Response. In
February 2013, APCI provided language to then-Rep. Greg Wren for inclusion in
legislation that would set standards for an entity to be a PBM provider for Alabama
Medicaid that only APCI could meet. Feb. 27th
2015 Response at 12. After
attending meetings with Wren regarding the language, Hubbard directed his staff
to add the language to the Medicaid portion of the General Fund Budget, resulting
in his Chief Legal Advisor emailing the APCI language to the head of the
Legislative Fiscal Office for inclusion in the General Fund Budget Bill.
AGdoc0223151, attached as Exhibit 13 to States Feb. 27th 2015 Response.
Shortly thereafter, the APCI drafted language became a part of the House of
Representatives substitute version of the General Fund Budget (AGdoc0232108-
09, attached as Exhibit 14 to States Feb. 27th 2015 Response), which prompted
APCI president Tim Hamrick to send a thank-you letter to Hubbard. AG0170228,
attached as Exhibit 15 to States Feb. 27th 2015 Response. Indeed, APCI knew the
Speaker [was] on board as early as March 27, 2013 and used Hubbards support
DOCUMENT 369
27
of the legislation to assist their lobbyist in influencing other legislators to vote in
favor of APCIs language. AGdoc0088791, attached as Exhibit 1; see also March
15, 2013 Email from Ferrell Patrick to Hubbard, AG0169699, attached as Exhibit 2
(Patrick compliments Hubbard on being a hero with the pharmacy leaders).
Hubbard himself actually took APCIs lobbying efforts a step further by personally
assisting Patrick in lobbying Dr. Don Williamson by authorizing Patrick to use
info in [a] document that contained a proposal [that] was shared with several
legislative leaders. March 16, 2013 Email from Ferrell Patrick to Hubbard,
AG0169701, attached as Exhibit 3.15
On April 23, 2013, the substitute version of the General Fund Budget was
voted on and approved by the House of Representatives. Hubbard voted yes on
the bill even though it contained the APCI drafted language that would make
APCI, for whom Hubbard was a retained consultant, the exclusive PBM for
Medicaid. AGdoc0232147, attached as Exhibit 16 to States Feb. 27th 2015
Response.
In doing so, Hubbard voted for legislation in which he knew or should have
known that he had a conflict of interest, violating Section 36-25-5(b) of the
Alabama Code. While Hubbard tries to play semantics with the definition of
15
Six months earlier, Hubbard sent Dr. Williamson a letter advocating APCIs position, which was drafted in large part by APCI and Patrick. See AG0166383, attached as Exhibit 12 to
States Feb. 27th 2015 Response (Patrick writes to Hubbard: This is essentially the message, but I didn't want to be so presumptuous as to put into your words.); see also AGdoc0091972-74, attached as Exhibit 4 (APCI emails regarding: Draft of Letter to Williamson from the Speaker)
DOCUMENT 369
28
conflict of interest in the Ethics Act, Motion at 16-22, the Act clearly defines a
conflict of interest as a conflict on the part of a public official . . . between his or
her private interests and the official responsibilities inherent in an office of public
trust. Ala. Code 36-25-1(8). His vote for legislation that included language
drafted by and designed to guarantee a monopoly for APCI a business that was
paying Hubbard $5,000 per month to be a consultant and was run by a president
who thanked Hubbard personally for adding the necessary language to the 2014
General Fund Budget, AG0170228 attached as Exhibit 15 to States Feb. 27th
2015 Response. After Hubbard voted in favor of the legislation, APCIs lobbyist
confirmed in an email to APCIs president that the bill passed the House with our
language. AG0170321, attached as Exhibit 5; AGdoc0232147, attached as Exhibit
16 to States Feb. 27th 2015 Response. All of this meets the conflict of interest
definition, since Hubbards private interest in continuing to be paid $5,000 per
month by APCI would obviously conflict with the official responsibilities inherent
in representing all of his constituents and the people of Alabama who have an
interest in legislation. The need for bills being passed by unbiased legislators is
particularly true in this case, since the APCI language creates a monopoly for
Hubbards employer.
The Ethics Acts further explanation of what a conflict of interest involves
further supports the indictment. In the same section setting forth the just-quoted
DOCUMENT 369
29
conflict of interest definition, the Ethics Act further explains that a conflict of
interest involves any action, inaction, or decision by a public official in the
discharge of his official duties which would16 materially affect his financial
interest in a manner different from the manner it affects the other members of
the class to which he or she belongs. Ala. Code 36-25-1(8). Hubbards action
in voting on a budget as part of his official duties as a legislator that contained
language drafted by a private interest paying him $5,000 per month meets this
definition. As far as the State is aware, no other official who voted on the budget
was being illegally paid $5,000 per month by APCI meaning that Hubbards
support of the legislation, which was recognized as a job well done for APCI,
materially affected his financial interest in a manner differently from all other
legislators.
In sum, Hubbards improper attempt to challenge the sufficiency of the
evidence showing that he had a conflict of interest when he voted on a budget
including language APCI drafted and designed to make it the monopoly PBM
provider for Alabama Medicaid fails. It also highlights why the grand jury indicted
him under Count 5 in the first place and why only a jury can decide whether he is
guilty or innocent.
16
Hubbards focus on the meaning of would in this definition in terms of the degree to which the legislation cleared the way for APCI to have a monopoly misses the mark. Motion at
14-15. The question under Ala. Code 36-25-1(8) is whether Hubbards financial interest not that of APCI would be materially affected in a manner different from his fellow legislators.
DOCUMENT 369
30
ii. The non-binding Todd opinion does not provide Hubbard a defense to Count 5 since it was issued years after Hubbard
entered into the contract with APCI meaning he could not
have relied upon it in taking the actions he took, and is
clearly distinguishable. In any event, Hubbards arguments involve mixed questions of fact and law which can only be
decided at trial.
Failing to offer any convincing argument that he did not have a conflict of
interest in voting for the budget that would have made one of his paying
consulting clients the exclusive PBM for Alabama Medicaid, Hubbard argues
that the Ethics Commissions recent Advisory Opinion No. 2015-14, issued on
August 5, 2015, regarding Rep. Patricia Todd, excuses his actions. Motion at 20-
22. The Todd Opinion is not the get out of jail free card Hubbard suggests,
however, for multiple reasons. While the Ethics Commission has the authority to
issue advisory opinions, those opinions protect only (1) the person requesting them
or (2) people who rely on those opinions in good faith and in a materially like
circumstance. Ala. Code 36-25-4(a)(9). Ethics opinions do not protect any
person relying on the advisory opinion if the reliance is not in good faith, is not
reasonable, [or] is not in a materially like circumstance. Id.
The most obvious reason the Todd opinion does not aid Hubbard is that it
was issued three years after Hubbard entered into his consulting contract with
APCI and years after that contract ended. As a result, he could not possibly have
relied upon the Todd opinion in taking the actions underlying Count 5 meaning it
DOCUMENT 369
31
provides him no defense on that count. See 36-25-4(a) (9) (The written advisory
opinions of the commission shall protect the person at whose request the opinion
was issued and any other person reasonably relying, in good faith, on the advisory
opinion in a materially like circumstance from liability to the state, a county, or a
municipal subdivision of the state because of any action performed or action
refrained from in reliance of the advisory opinion.) (emphasis added).
Additionally, even if the Todd opinion had been issued in time for Hubbard
to rely upon it, his reliance would not be in good faith or reasonable, including
because the Todd opinion does not cover materially like circumstances to Count 5.
The Todd opinion simply says a legislator may vote on issues espoused by a public
interest advocacy organization even when the legislator is employed by that
organization. The Todd opinion does not endorse a legislator voting to set contract
rules that ensure that the organization will be the only bidder to qualify for the
contract. In other words, while the Todd opinion takes the position that Rep. Todd
may advocate and lobby on behalf of LGBT issues while serving as the Director of
the Human Rights Campaign of Alabama (HRC Alabama), it does not say Todd
may vote on legislation that would ensure that HRC Alabama was a monopoly
provider of some service to the State or a state agency.
Thus, even if the Todd opinion had existed when Hubbard took the actions
he did, it still would not support his attempt to make APCI the exclusive PBM for
DOCUMENT 369
32
Alabama Medicaid while receiving $5,000 per month from APCI. Hubbards
arguments are not purely legal questions and are, in fact, mixed questions of fact
and law, such as, what Hubbard did, whether that is similar to the Todd facts,
whether he could have relied on the Todd opinion in good faith and reasonably,
whether he did so rely, and whether the Todd opinion represents a correct
interpretation of the law.17
Such questions are not purely legal questions, and
therefore must be deferred until trial
iii. The non-binding Ross opinion does not provide Hubbard a defense to Count 6 because it, like the Todd Opinion, was
issued years after Hubbard entered into the contract with
APCI meaning he could not rely upon it in taking the
actions he took, and is clearly distinguishable. In any event,
Hubbards arguments involve mixed questions of fact and law which can only be decided at trial.
Hubbard is incorrect when he argues that Count 6 should be dismissed in
light of the Ethics Commissions Advisory Opinion No. 2014-04, issued on
October 1, 2014 regarding Senator Quinton Ross. That opinion takes the position
that Ross could enter into a consulting contract with the City of Montgomery
related to youth activities planned for the 50th
anniversary of the Selma to
17
In fact, although this Court need not wade into the issue since Hubbard could not have
reasonably relied on the Todd opinion in taking any of the actions with which he is charged due
to its recent issuance and the materially different factual circumstances out of which the Todd
opinion arises, the Attorney General and the District Attorneys Association, on behalf of every prosecutor in the State of Alabama, have jointly requested that the Ethics Commission reconsider
and withdraw the Todd opinion because it incorrectly interprets the Ethics Law. See AG, DAs protest chiseling of Alabama Ethics Law, John Archibald, AL.com, September 14, 2015, available at: http://www.al.com/opinion/index.ssf/2015/09/ag_das_protest_chiseling_of_al.html.
DOCUMENT 369
33
Montgomery March. Motion at 22-24. Count 6 charges Hubbard with soliciting or
receiving $5,000 per month from APCI, a principal under Ala. Code 36-25-5.1(a).
Hubbards argument that the Ross opinion is a defense to Count 6 fails for
the same reason that his argument based on the Todd opinion fails. First, the Ross
opinion was issued on October 1, 2014, years after Hubbard entered into the APCI
contract meaning he could not have relied upon the Ross opinion when he entered
into that contract. Second, the Ross opinion does not arise out of similar
circumstances to Hubbards APCI contract because the contract covered by the
Ross opinion was for a one-off historic special event, not an on-going
representation of a private client for thousands of dollars per month. Accordingly,
given the clearly different circumstances involved in the Ross opinion, even if
Hubbard could have relied upon it, his reliance would not be in good faith or
reasonable meaning it could not provide him a defense to Count 6.18
At the very
least, as with his arguments regarding the Todd opinion, Hubbard presents no
questions of pure law and merely argues mixed questions of fact and law, and
therefore must be deferred until trial.
18
Hubbard is incorrect to suggest that the Ross opinions failure to address whether the City of Montgomery was a principal and therefore barred from hiring legislators means the
opinion approves of such arrangements. Motion at 19-20. As he notes, the opinion did not
address those facts. Id. In any event, the opinion is distinguishable from the Hubbard facts,
because using ones legislative position to secure a contract for a paymaster, as Hubbard did, is very different from helping a municipality commemorate a civil rights event, as Ross did.
DOCUMENT 369
34
B. Counts 79 charging Hubbard with using his office to obtain personal gain, namely $12,000 per month, from SEAGD and
lobbying the Governor and Department of Commerce on
SEAGDs behalf are legally sufficient.
As charged in the indictment and further detailed in the States Motion for
More Definite Statement Response, from March 2012 to August 2013, Hubbard
was paid $12,000 per month by the Southeast Alabama Gas District (SEAGD) to
work as an economic development consultant. Feb. 27th 2015 Response at 15.
In all, Hubbard received $208,848.88 during that time period. Id. SEAGD obtained
a letter from Hugh Evans, General Counsel for the Ethics Commission, related to
Hubbards arrangement with SEAGD. AGdoc0063381, attached as Exhibit 19 to
States Feb. 27th 2015 Response. The letter advised SEAGD that the Ethics Act
mandated that the Speaker may not use his position or the mantle of his office to
assist him in obtaining consulting opportunities or providing benefits to his
consulting business or his clients. Id.
One obvious reason for that admonition is to ensure that all constituents are
represented equally, and that Hubbard not be able to receive (a very large)
something extra on the side to give the red carpet level representation to a select
few some of whom were not even his constituents or Alabamians. Hubbard was
being paid his legislative salary to represent his district as a legislator and all
Alabamians as Speaker. He was told in express terms by the Ethics
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35
Commissions counsel not to use his office for the personal benefit of himself,
his businesses, or his clients.
Contrary to that warning, Hubbard repeatedly violated the restriction in the
Ethics Commission letter, as shown on monthly activity reports he submitted to
SEAGD. In those reports, which contained Hubbards explanation for why
SEAGD was paying him $12,000 monthly, Hubbard reported that he had in fact
used his position and the mantle of his office to benefit himself, his businesses, and
his clients. He had done his best to ensure that SEAGDs interests were promoted
extra special before state government authorities.
Hubbard stated that he:
(a) met with Commerce Secretary Greg Canfield regarding the relocation of a truck plant from Pennsylvania to the Abbeville area (AGdoc0051085,
attached as Exhibit 20 to States Feb. 27th 2015 Response);
(b) met with Secretary Canfield on several occasions to discuss projects in Abbeville and Ozark (AGdoc0051086, attached as Exhibit 21 to States Feb. 27
th 2015 Response);
(c) met with Governor Bentley about the Abbeville project and outlined to the Governor what the State would need to provide to land the project (AGdoc0051088, attached as Exhibit 22 to States Feb. 27th 2015 Response);
(d) arranged a meeting for July 19, 2012 with Governor Bentley and others to discuss the relocation of a business from Miami to the Dothan Airport
(AGdoc0051090, attached as Exhibit 23 to States Feb. 27th 2015 Response);
(e) met with Governor Bentley and his Chief of Staff, David Perry, on July 12, 2012 to discuss recruiting an industrial refurbishing business,
Commercial Jet, to relocate its business operations to the southeast
Alabama area and the commitment the State of Alabama would need to
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36
make as well as funding sources (AGdoc0051091, attached as Exhibit 24 to States Feb. 27th 2015 Response);
(f) set up and led a meeting on July 18, 2012 with Governor Bentley and others regarding the Commercial Jet project (Id.);
(g) described coordinating a second meeting with Governor Bentley regarding Commercial Jet on August 31, 2012, where he also noted the
attendance of numerous state and local officials (AGdoc0051092,
attached as Exhibit 25 to States Feb. 27th 2015 Response);
(h) participated in a conference call with Governor Bentley, Greg Canfield and David Perry in September 2012 regarding the incentive package the
State would offer for the Commercial Jet deal, where he stated he
continue[d] to be a cheerleader for the project and point[ed] out the obvious economic and political benefits created by the successful
recruitment of the company and that he had received a commitment that the state will provide the necessary incentives (AGdoc0051093, attached as Exhibit 26 to States Feb. 27th 2015 Response);
(i) received a suggestion from an executive with Hankook Tire that Hubbard travel to South Korea to meet with him and who believed Hubbards role in government would mean a great deal and put Alabama at the top of the list if I were to visit (AGdoc0051094, attached as Exhibit 27 to States Feb. 27th 2015 Response); and
(j) spoke with Secretary Canfield in October 2012 and ensured that our area is considered and we are included in the mix (Id.).
In addition to these instances documented in reports Hubbard submitted to
SEAGD, Hubbard also violated the restriction that he not use his position or the
mantle of his office to assist SEAGD when he wore a name tag identifying himself
as Speaker of the House while on a SEAGD funded trip to the Paris Air Show in
June 2013. (See AGdoc0047918, AGdoc0047921, Invoices, etc., attached as
Exhibit 28 to States Feb. 27th 2015 Response; AG0742807, AG0742802, photos,
attached as Exhibit 29 to States Feb. 27th 2015 Response; see also AG0742798
DOCUMENT 369
37
Email from lobbyist Minda Riley Campbell to Hubbard, attached as Exhibit 30 to
States Feb. 27th 2015 Response.).
Count 7 charges Hubbard with using his office for personal gain by seeking
compensation from and being compensated by SEAGD for his activities as a
public official, and Counts 8-9 charge Hubbard with acting as a paid representative
for SEAGD in his dealings with the Alabama Department of Commerce and the
Office of the Governor for the State of Alabama.
Hubbard does not contest that he did any of the above actions in his Motion.
Instead, in his Motion, Hubbard asserts that the Ethics Commission letter shields
his actions from prosecution under Counts 7-9, Motion at 25-27, 29-31, 34-35, and
that he has a fundamental right to lobby that shields him from prosecution under
Counts 8-9. Motion at 31-34. The first assertion is nothing more than an improper
sufficiency of the evidence argument, while the second finds absolutely no legal
support.
i. Hubbards arguments that he complied with the terms of the letter from the Ethics Commission present factual
questions for a jury to decide.
The Evans letter provides no protection for Hubbard because he failed to
follow the Ethics Commissions General Counsels guidance. That is, the
indictment alleges Hubbard illegally used his position as a legislator and/or
Speaker and/or the mantle of his office to benefit himself, his businesses, or
DOCUMENT 369
38
SEAGD. Hubbards contrary contentions that his actions did somehow abide by
the terms of the letter are wrong, in the States view, but they are ultimately factual
questions requiring jury determination at trial, not legal questions properly
presented in a motion to dismiss the indictment.19
At the very least, they are mixed
questions of fact and law (not purely legal), and therefore must be deferred until
trial.
ii. Hubbards self-serving argument that he has a fundamental right to lobby, or more accurately a fundamental right to
get rich lobbying while serving as a public official, is absurd
and wholly ignores the rights and interests of his
constituents, other public officials who do not seek to use
public office to get rich, and the people of the State of
Alabama.
Hubbards argument that Counts 8 and 9 charging him with lobbying the
Governor and the Secretary of Commerce while serving as a public official and
being paid $12,000 per month by SEAGD violate his right to lobby on behalf of
his or his business clients under the First Amendment is extreme and legally
unsupported. Motion at 31.
To the States knowledge, this argument has never been made by any public
official in a corruption prosecution and Hubbard cites no authority for his novel
argument. This is unsurprising since it defies logic to argue that a public official
has a constitutional right to get paid extra above and beyond their legislative
19
Hubbards argument based on the Ross opinion is unavailing for the reasons detailed in Section III.A.iii above.
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salary to provide extra, red carpet lobbying services for those willing to pay them
and their businesses directly.
This is not a case about campaign contributions. This is a case about money
paid directly to Hubbard or his businesses because he serves as the Speaker of the
House. Under Hubbards view, other Ethics Law provisions, like the revolving-
door prohibition, would be a dead letter if legislators can simultaneously be paid
lobbyists. Likewise, Hubbards consulting contract legislator lobbyist exception
would render the 2010 reforms limiting the influence of lobbyists and principals
meaningless. Indeed, Hubbards argument advances such an untenable legal
position that it would nullify virtually every provision in the Ethics Law. Surely,
then, Hubbards motion to dismiss is due to be denied.
Here, the statues at issue are not facially invalid, nor have they been
improperly applied to Hubbard. The Ethics Act prohibits legislators from
representing any person, firm, corporation, or other business entity before an
executive department or agency for a fee. Ala. Code 36-25-1.1. The statute does
not prohibit Hubbard from representing himself, his constituents, or some other
person before an executive department or agency as part of his official duties for
which he receives a salary paid for by the people of Alabama or in his capacity as a
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citizen of Alabama. It only narrowly prohibits him from doing these things for a
fee. Thus, the statute does not infringe upon his right to free speech.20
Hubbard also similarly argues that Section 36-25-1.1 is unconstitutionally
overbroad because it bans lobbying for a fee in all cases, not just where there is
found to be a conflict of interest. Motion at 33-34. Hubbard cites no authority for
the proposition that conflict of interest must be an element of every ethics law
applying to legislators. Moreover, there is obviously no need to include the words
conflict of interest in Section 36-25-1.1, because a legislator lobbying for a fee
presents a per se conflict of interest. The conflict will be present in all cases.
A fundamental and irreconcilable conflict of interest exists when a
government official elected by popular vote to serve and represent the interests of
the public at large receives thousands of dollars per month on top of his public
salary from private interests and entities to lobby on their behalf and represent
them before the government in which the official serves.
Hubbards arguments here focus solely on vindicating his ability to enrich
himself with lucrative lobbying fees while holding public office. But Hubbard
20
Since the statute does not infringe on Hubbards First Amendment rights, there is no justification for subjecting it to strict scrutiny. Motion at 28. Nevertheless, even if it were
subjected to strict scrutiny, it would clearly still be constitutional since its prohibition is narrowly
drawn to only prohibit legislators from lobbying an executive department or agency for a fee
over and above their legislative salary, and supports the States recognized strong interest in preventing corruption or the appearance of corruption. See Fed. Election Commn, 470 U.S. at 49697.
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ignores the obvious reasons why governmental officials should be restricted from
being paid to represent people and entities before governmental agencies and
officials. For starters, his constituents have a strong interest in the restriction
because without it their interests would necessarily take a backseat to the interests
of Hubbards paying clients. The law also serves the interest of other public
officials who should know whether they are meeting with a legislator, a lobbyist,
or a legislator lobbyist. Finally, the States strong interest in preventing corruption
or the appearance of corruption also supports the constitutionality of the law. This
interest is served through the legitimate means of restricting elected officials from
serving their lobbying clients over the interests of the people who elected them.
Indeed, the legislative findings contained in the Ethics Act illustrate why the
protection of Hubbards constituents, other public officials, and the State requires
such a restriction. The six legislative findings supporting the Ethics Act, Ala.
Code 36-25-2, followed by the States brief explanations of how they support the
restriction contained in Section 36-25-1.1, are as follows:
(1) It is essential to the proper operation of democratic government that public officials be independent and impartial.
a. Such independence and impartiality clearly are impossible if public officials are paid to represent the interests of the well-heeled before
all others.
(2) Governmental decisions and policy should be made in the proper channels of the governmental structure.
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a. Proper channels of governmental structure are impossible if a government composed of public officials elected by the voters
channel their decisions and policy through their paymasters.
(3) No public office should be used for private gain other than remuneration provided by law.
a. Legislators receive a salary to do their legislative work which includes lobbying the executive branch.
(4) It is important that there be public confidence in the integrity of government.
a. Public confidence in governmental integrity is impossible if the government is composed of public officials responsive primarily to
those with the resources and ability to buy their time and attention.
(5) The attainment of one or more of [these ends] is impaired whenever there exists a conflict of interest between the private interests of a public
official and the duties of the public official.
a. A clear conflict of interest exists if a public official is being paid to represent the interests of a few when his official duties require him
to represent the interests of all of his constituents.
(6) The public interest requires that the law protect against such conflicts of interest and establish appropriate ethical standards with respect to the
conduct of public officials in situations where conflicts exist.
a. The prohibition against legislators representing any person before an executive department or agency, for compensation above and
beyond their legislative salary, is a clear way to protect against a
conflict of interest and to establish appropriate ethical standards.
Thus, restricting legislators from representing interests for an extra fee above and
beyond their public salaries is fully consistent with the legislative findings
underlying the Ethics Act.21
21
Hubbards brief mention that the statute does not provide fair warning as to what constitutes representation similarly fails. Motion at 30. Section 36-25-1.1 is titled Lobbyists and defines what constitutes lobbying. The section then prohibits members of the Legislature
from representing, for a fee, reward, or other compensation, in addition to that received in his or her official capacity any person, firm, corporation, or other business entity before an executive
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C. Count 10 charging Hubbard with accepting a thing of value from
Edgenuity, a principal, is legally sufficient.
Similar to his contract with APCI, Hubbard was paid $7,500.00 per month
from another principal, Edgenuity, Inc. and/or E2020, beginning in April 2012.
That company, like APCI, employed lobbyist Ferrell Patrick in Alabama and had
active interests in state government. See March 31, 2013 Email from Patrick to
Michael Humphrey, AG0169842, attached as Exhibit 6 (The political and
educational landscape have aligned with a unique opportunity for Edgenuity to
explode its [sic] presence in Alabama. To maximize this opportunity, I must
engage personally and dedicate all the resources at my disposal. To this end, I
propose you retain The Patrick Company at a fee of $10 thousand per month.). In
fact, Patrick offer[ed] tutorials to Hubbard learn more about what [Edgenuity]
do[es]. AG0165120-21, attached as Exhibit 7.22 Hubbard was therefore
prohibited from accepting things of value from Edgenuity under Section 36-25-1.1
while he held public office. See Count 10.
department or agency. Reading the statute as a whole and looking to its plain meaning, it is clear
that representation includes Hubbards actions on SEAGDs behalf before the Alabama Department of Commerce and Office of Governoractions he included in his monthly activity reports back to SEAGD, which were used to justify his work for the money he was paid.
.
22
Less than five months later, Patrick also arranged for at least $20,000.00 in political
contributions to PACs affiliated with Hubbard from two of Patricks lobbying clients, Compass Learning and APCI. See August 2, 2012 Email from Hubbard to Minda Riley Campbell,
AG0543145, attached as Exhibit 9.
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Even though Hubbard was prohibited from taking things of value (i.e., the
$7,500.00 per month) from Edgenuity because it was a principal, Hubbard took the
money and his consulting activities directly involved his public office. Edgenuitys
internal emails show that Hubbard served as the companys contact for House
Speakers in all 50 states. AGdoc0158228, attached as Exhibit 32 to States Feb.
27th 2015 Response. Hubbard knew that his position as Speaker was central to his
work for Edgenuity, as he acknowledged in an email to the President of
Edgenuity, Michael Humphrey: I was just in Alaska for the National Speakers
Conference. It is a great opportunity to spend time with and establish a relationship
with fellow speakers. AG0166226-28, attached as Exhibit 8.
In fact, Hubbards original contract with Edgenuity made clear that he would
act as their lobbyist until Patrick emailed Humphrey with suggested edits to to
eliminate the suggestion that [Edgenuity was] hiring [Hubbard] as a lobbyist.
Email from Patrick to Humphrey attaching document entitled Mike Hubbard
Lobbyist.docx, AG0164813, attached as Exhibit 1023; see also Email from
Humphrey, AG0164808-10, attached as Exhibit 11 (Here is the proposed lobby
contract for Mike Hubbard. Mike is the current Speaker of the House in
Alabama.my thought in using him would be for intros into House and Senate
23
See also Email from Patrick to Humphrey, AG0166376, attached as Exhibit 14 (Hope it's okay with you, but I made [a] change to Mike [Hubbard] and me to reflect work outside the
state of Alabama. I know that this is an internal doc, but in the wrong hands could prove to be a
nuisance, since we don't have to register in AL.) (emphasis added).
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leadership in states where we do not have lobby support (and even states where we
do, when necessary)..) (emphasis added).
At one point, Hubbard emailed Humphrey to report that he assisted
Edgenuitys lobbying efforts with the South Carolina Speaker of the House, Bobby
Harrell. Hubbard emailed Humphrey and said: I hope the contract in Charleston
you were having issues with a while back is still going well. I know Speaker
Harrell got involved in that one following my call to him. AGdoc0158088,
attached as Exhibit 33 to St