Fifteen years ago, long before Florida's recession-necessitated tiptoeing into legalized gambling, the state's attorney general, Bob Butterworth, waged a war on an unlikely racketeering pastime: bingo. Specifically, the state alleged that Canadian businessman Philip Furtney had made a killing off of his "hall-for-hire" businesses across the state (including one in Orlando), skimming cash off of the top from an elderly clientele engaging in a kind of gambling that by law was only permitted when the monies went to charity.
In truth, Furtney was operating his several corporations legally, a fact that the state would later admit when they dropped the 40-odd criminal charges against Furtney in 1999, then when a judge shot down a civil suit on appeal in 2007.
But Butterworth's moral crusade against bingo brought with it some hefty costs. Because of the state's misguided activism, the attorney general's office was on the hook for more than $5 million in fees associated with the case. Did they pay for their mistakes?
Not yet. On Feb. 26, Furtney's defense attorney, Steve Mason, having exhausted all other lines of communication, issued subpoenas to both the attorney general and his custodian of records, ordering them to appear at the Orange County Courthouse on Mar. 22. That attorney general is now Bill McCollum, the Republican gubernatorial candidate potentially facing the state's chief financial officer, Democrat Alex Sink, in November's general election.
Sink could write the check, and even says she would write the check, thereby cutting off the mounting interest to be paid by taxpayers, if McCollum would just follow procedure and issue her a voucher to do so. McCollum claims his office is immune to court judgments by law and has filed repeated motions to keep from paying.
Game on. The old bingo case has new political legs.
In 1995, the state obtained its injunction against Furtney and his corporations (Bradenton Group Inc., Pondella Hall for Hire Inc., Eight Hundred Inc., among others) in a private, "ex-parte" conference with an Orlando judge, allowing authorities to issue an arrest warrant. Furtney was arrested in Montana in 1996, held on $1.5 million bail and incarcerated in Orange County jail for weeks. His properties and accounts were seized by the state. In 1999, Furtney was acquitted of all of his illegal gambling and racketeering charges by a jury, and the court ruled that the original injunction was flawed, thus requiring the state to pay Furtney's attorneys' fees. The state appealed the decision, but eventually settled the judgment.
In 2005, the state made another attempt at Furtney, this time in a civil trial. A jury of six ruled in favor of the state, surprisingly, especially considering a 2001 Florida Supreme Court ruling that made it unlawful to build a racketeering case on the back of the state's bingo statutes. That case was successfully appealed in the Fifth District Court of Appeals in 2007 — with the court going as far as to refer to some of the state's arguments as "disingenuous" and "specious," according to court documents — and the state was again ordered to pay damages.
In Sept. 2007, Furtney died, missing the positive outcome of his appeal by just two months. His brother Bruce is now the executor of his estate.
Even after Furtney's death, the state continued to deny culpability or the validity of the original injunction, appealing the decision in 2008 to the Florida Supreme Court. There they complained that having to follow the court's order and pay on a judgment could have a "ruinous impact" on the office of the attorney general, "placing this office in the objectionable position of forgoing prosecution of legitimately contested matters due to the actions of state attorneys." In other words, having limits to their power would make their job impossible.
According to Mason, the total judgments ordered due to Furtney's corporations add up to about $5.3 million. That amount accrues interest at a rate of 11 percent, meaning that his client is actually owed $6.2 million now. A separate $300,000 judgment is pending review (and a near certainty) in the Fifth District Court of Appeals.
That money, according to McCollum's deputy director of communications, Ryan Wiggins, won't be coming soon. She says the attorney general's office is protected by a state statute.
"Neither the state nor any of its agencies shall pay or be required to pay monetary damages under the judgment of any court except pursuant to an appropriation by law," it reads. "That's all you need to know," says Wiggins.
"That is the biggest bunch of baloney," says Mason. "We've litigated all of these arguments for the last several years, and they have been repeatedly rejected by the courts. The judgment was entered. It's been upheld by the Fifth District Court of Appeals. They stay has been denied by the Florida Supreme Court. What is it about the word ‘final' they don't understand?"
Mason points to a 2008 court ruling in favor of Contractpoint Florida Parks LLC, a company that had contracted with the state department of environmental protection for some work in its parks system. The state didn't satisfy its end of the deal, and in the end was ordered to pay Contractpoint $600,000. The state appealed — with McCollum ironically handling the litigation — and eventually paid Contractpoint $820,000 (including $220,000 interest). That money was not "appropriated" by the legislature, but dug out of a departmental trust fund.
Although the Furtney case is not a contractual dispute — rather a case of "the attorney general's office using the court as a weapon to hurt someone," says Mason — it does show that, given the proper pressure, the state can and will satisfy its obligations. Also, the state has already written three checks, totaling $300,000, to settle its fees on the Furtney case, something that would appear to send a mixed message. Not nearly as mixed, though, as 15 years of litigation to get out of paying.
Contacted for comment, Sink's press secretary, Kevin Cate, deferred to a letter already filed in the court documents in which Sink's office clarifies that "it is the obligation of the office of the attorney general to request the CFO to make payment of any judgment against the attorney general. Rightly or wrongly, the attorney general has the prerogative to litigate on appeal concerning judgments such as those obtained by you on behalf of the Bradenton Group, notwithstanding the likelihood of greater costs to the taxpayers if the litigation is ill-advised. The CFO has no authority to compel the attorney general to discontinue such litigation, even if she might foresee extra expense to the public as a consequence of its continuation."
Mason has attempted to reach out to McCollum's office in writing several times, encouraging the attorney general to at least come to the table. His communications have been ignored. In a Feb. 25 motion filed by Mason (along with his "blood brother" in the case, attorney Thomas Egan) the attorney raises the stakes to "civil contempt," asking that the court take McCollum into custody.
"If this were a regular citizen, if it was you or I, you know we'd be in jail," says Mason.
McCollum's office actually did respond to the subpoena on the same day it was delivered, Feb. 25, with a letter hand-delivered to both the speaker of the house, Larry Cretul, and the president of the senate, Jeff Atwater. In that letter he asks the legislature consider making a "specific appropriation" to settle the damages, something they couldn't do until, at earliest, next year's session.
Having only become aware of the letter last weekend, Mason issued two additional motions to the court on Mar. 6 and Mar. 8, the latter of which calls foul on McCollum's motives in writing the letter, referring to it as "a ruse to provide cover for the attorney general's refusal to honor court process." He may be right, considering that the attorney general's office made no mention of the letter when contacted by this paper. (On March 8, McCollum filed an emergency motion to quash the subpoena.)
"The court has said, ‘We've adjudicated a dispute, determined that you have a legitimate, justifiable debt, and you've got to pay it.'" says Mason. "It's not even intellectual honesty to make that argument `that the attorney general's office can't make the payment`. At this point and time it's just political stubbornness."
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