United States District Court, D. Massachusetts
MEMORANDUM AND ORDER
DENISE J. CASPER, District Judge.
Defendant John George ("George") has moved to dismiss the indictment against him. D. 47, D. 48. Having considered the motions, the supporting memorandum, D. 46; D. 47, the government's opposition, D. 53, and the arguments presented at the motion hearing, D. 54, the Court DENIES the motion.
II. Factual Background
The following summary is as alleged in the indictment.
George was the owner and operator of the Union Street Bus Company ("USBC"), a bus company in New Bedford and Fall River, Massachusetts, that managed, operated and maintained public buses in New Bedford, Fall River and elsewhere. D. 1 at 1. George also ran John George Farms (the "Farm"), a farm in Dartmouth, Massachusetts that operated a produce stand and distributed produce in Southeastern areas of the Commonwealth. Id.
The Southeastern Regional Transit Authority ("SRTA") is a state regional transit authority providing services to various cities and towns including but not limited to New Bedford and Fall River. Id. at 1-2. Between 2005 and 2011, the United States Department of Transportation ("DOT") provided annual benefits in excess of $10, 000 to USBC via the SRTA, funded by DOT pursuant to numerous federal grants. Id. at 5. SRTA budgets, contracts and the appointment of its administrator are decided by its ten-member advisory board. Id. at 2. A friend of George's served as the Dartmouth representative to the advisory board from approximately 1995 to 2005 and also as the SRTA administrator from approximately 2008 to 2010. Id. at 4. From at least in or about 1995 to in or about December 2010, SRTA awarded USBC consecutive five-year contracts for over $1, 000, 000 per year under which USBC was responsible for managing, operating and maintaining the public bus transit services for the region. Id. at 2. Beginning in or about December 2010, SRTA paid USBC over $1, 000, 000 to operate the regional bus system, but did not award USBC another five-year contract. Id. These funds, distributed yearly, were used to pay USBC salaries, benefits and other expenses. Id.
The funds were also used to pay George a monthly management fee which was paid to Trans-AG Management, Inc., a holding company George owned. Id. George used a portion of these management fees toward his USBC salary and, as a result, qualified for SRTA pension benefits. Id. During the period between 2007 and September 30, 2011, George directed USBC to pay him over $1, 000, 000 in management fees, specifically $211, 000 in 2007, $229, 443 in 2008, $246, 657 in 2009, $265, 150 in 2010 and $177, 800 in 2011. Id. (chart). Faced with the termination of the USBC contract, in or about 2011, George inflated his purported USBC salary by approximately $200, 000 to boost his yearly pension payment from the SRTA. Id. at 7.
The indictment further alleges that in or around 2005, George provided his associate on the SRTA advisory board with questions to ask another bidder who at the time was competing with USBC for the five-year SRTA contract. Id. at 7. In or around 2010, George advised this associate to limit public advertisements for the SRTA contract budding process so as to reduce USBC's competition. Id. The indictment further alleges that in or about 2010 George directed certain USBC managers and employees to attend a $100-per-person political fundraiser to garner support for USBC regarding the potential renewal of the SRTA contract. Id. The indictment also alleges that in or about 2010, George caused USBC to pay approximately $10, 000 to a contractor as compensation for construction work, including a kitchen re-model, at his residence. Id.
The indictment further alleges George employed several individuals at USBC, but at various times instructed them to perform work at the Farm during their USBC hours. Id. at 3-4. Worker 1, George's longtime companion, was employed full-time at USBC as an assistant administrator and received a salary of $93, 000 and benefits. Id. at 3. However, from March through October, Worker 1 regularly worked during USBC business hours at the Farm, including managing Farm employees and the produce stand. Id. George permitted Worker 1 to work from home so as to conceal that Worker 1, who was responsible for hiring and supervising Farm employees at the produce stand, worked at the Farm on a daily basis. Id. at 6. George and Worker 1 caused SRTA vehicles to be used for commuting to the Farm and for other personal purposes. Id. Worker 1 also instructed other USBC workers to use SRTA facilities to refuel vehicles for personal or Farm-related use. Id. Also alleged as part of the conspiracy, on one occasion Worker 1 instructed Worker 3 to fix a flat tire on Worker 1's SRTA vehicle after Worker 1 had been driving in Rhode Island for personal use. Id. Worker 1 also purchased office supplies and other items through USBC for use at the Farm and at George's residence. Id. at 6-7.
Worker 2, a longtime associate of George, was also employed full-time at USBC as a night supervisor. Id. at 3. Worker 2 received a salary, benefits and a vehicle for USBC-related travel. Id. At George's direction, Worker 2 drove the vehicle to the Farm almost daily during the Farm season to perform Farm work. Id.
Worker 3 was employed full-time as a supervisor of maintenance at USBC, supervising approximately thirty USBC employees including Worker 2 and Worker 4, a bus mechanic responsible for repairs and maintenance work on SRTA buses and equipment. Id. On several occasions, George directed Worker 3 to dispatch Worker 4, during Worker 4's USBC hours, and others to the Farm to use SRTA equipment to perform maintenance and repairs on Farm vehicles and equipment. Id. at 3-4. George also directed Worker 3 and other USBC employees to use SRTA vehicles to plow snow from the Farm and his personal residence. Id. at 4.
In or about September 2010, George instructed a USBC assistant manager to send Worker 4 to the Farm to perform Farm-related work during his USBC office hours. Id. at 8. From at least as early as 2005 to October 2011, George directed Worker 4 to use SRTA equipment to perform sandblasting and paint work on a Farm tractor. Id. During 2005 to October 2011, George directed Worker 4 to use SRTA equipment to perform sandblasting and paint work on a Farm tractor, and in or about 2008 to 2010, George directed Worker 4 to use SRTA air conditioning equipment to the Farm to repair a Farm vehicle. Id. at 8.
Worker 5 was employed full-time as the information technology manager for USBC. Id. at 4. Worker 5 was responsible for purchase, inventory and maintenance of computers and electronic data systems at USBC. Id. George directed Worker 5 to purchase and provide him with several USBC cellular phones for both the Farm and George's personal use. Id. Worker 5 bought ...