STATE OF NEW YORK OFFICE OF THE ATTORNEY GENERAL Euio"T, Scuenpensias HARLAWA. LOY ATTORNEY GENERAL (Cuuee Durr ATTORNEY Gesteat ‘COUNSEL TO THE ATTORNEY GENERAL December 24, 2014 Comptroller Thomas P. DiNapoli Office of the State Comptroller 110 State St Albany, NY 12236 Re: Public Officers Law §19 Application on behalf of former Senator Joseph L. Bruno for Reimbursement of Attorneys’ Fees and Litigation Expenses Dear Comptroller DiNapoli: ‘As you know, counsel for former Senator Bruno has requested reimbursement pursuant to Public Officers Law § 19 for $2,419,200.25 of expenditures made by Mr. Bruno, and others on his behalf, for Mr. Bruno’s criminal defense in United States v. Bruno. Because the prerequisites of § 19 have been satisfied, this Office has no choice but to certify that the expenditures, including expenditures made by the Committee to Re-Elect Senator Bruno, are eligible for reimbursement to the extent they are determined to be reasonable upon audit. Although these circumstances will result in the state’s reimbursing a long-dormant campaign committee, that unseemly result is unavoidable given the statutory mandete of § 19 and the sorry state of the Blection Law. There is no provision of law that would excuse the state from reimbursing cligible expenditures made by a “zombie” campaign committee that supposedly exists for the purpose of electing an official who has not held office in more than six years. Currently, Election Law allows campaign committees to operate and expend funds for “any lawful purpose,” so ong as the funds are not converted “to a personal use which is unrelated to a political campaign or the holding of a public office or party position,” Election Law § 14-130, and does not mandate any specific time limits for winding down a campaign committee. This gives former candidates and officeholders substantial flexibility when directing the use of campaign funds. The potential for abuse in this system is well documented and should not be tolerated. In hopes that this shortcoming will be addressed in the upcoming legislative session, I am forwarding a copy of this letter to Governor Andrew M. Cuomo, Senate Majority Leader Dean G. Skelos, and Assembly Speaker Sheldon Silver.Comptroller DiNapoli December 24, 2014 Page 2 of 3 Until the law in this area is amended, however, the state is constrained to reimburse the eligible expenditures made on Mr. Bruno’s behalf by his campaign committee, because the Public Officers Law makes it a “duty” of the state to reimburse all eligible expenditures, regardless of who incurs the expenditure, see Public Officers Law § 19(2)(a). The Criminal Proceedings ‘Mr. Bruno was first indicted on or about January 23, 2009. Following a jury trial, Mr. Bruno was convicted of two counts of “honest services fraud” and acquitted on five other counts, a mistrial having been declared on the remaining count. United States v. Bruno, 661 F.3d 733 (2d Cir. 2011). On December 9, 2011, the United States Court of Appeals for the Second Circuit vacated Mr. Bruno’s conviction. Counsel for Mr. Bruno sought reimbursement for expenses incurred in the defense of that criminal proceeding. By letter dated, March 2, 2012, our office determined that Mr. Bruno’s request was premature in light of the likelihood that the United States Attorney for the Northern District of New York would pursue a superseding indictment. In fact, a superseding indictment was filed on May 3, 2012. Following a further appeal to the Second Circuit, Mr. Bruno was tried in the United States District Court for the Northern District of New York on two counts of honest services mail fraud premised on the same counts as the two counts for which he had previously been convicted; however, the United States Attomey retried Mr. Bruno under a bribery and kickback theory in the second trial. On May 16, 2014, the jury in the second trial returned a verdict of not guilty on both counts. Accordingly, all of the above-referenced criminal charges have been dismissed. The Application for Reimbursement By letter dated May 16, 2014, counsel for Mr. Bruno notified this office that Mr. Bruno had been acquitted that day, and reiterated their request for reimbursement. At that time, counsel had not identified the amount requested for the second trial or submitted documents supporting the expenditures for the second trial. In further correspondence on June 11, 2014, counsel submitted certain documents in support of Mr. Bruno’s request for reimbursement for attorneys’ fees and expenses for both trials in the amount of $2,419,200.25. By letter dated July 7, 2014, our office requested certain other documents and information necessary to review Mr. Bruno’s request. Further correspondence and supporting documents followed—letters dated July 21, July 31 (two), and August 5, 2014, emails dated August 15, and September 10, 2014, and letters dated October 2, October 3, October 22, October 27, and November 25, 2014, as well as our office’s response on December 9, 2014, This office will provide copies of documents not previously forwarded to your office under separate cover. Public Officers Law § 19(2)(a) provides in relevant part that “it shall be the duty of the state to pay reasonable attorneys’ fees and litigation expenses incurred by or on behalf of an employee in his or her defense of a criminal proceeding in a state or federal court arising out of any act which occurred while such employee was acting within the scope of his public employment or duties upon his acquittal or upon the dismissal of the criminal charges againstComptroller DiNapoli December 24, 2014 Page 3 of 3 him ....” The term “employee” includes “any person holding a position by election” and includes former employees. id. § 19(1)(a). Based upon a searching review of the material submitted in support of the application, we have determined that former Senator Bruno meets the criteria set forth in Public Officers Law § 19(2)(a). Accordingly, the statute requires that the state reimburse those fees and expenses which are “reasonable,” Public Officers Law §§ 2(a) & (3), subject to the review and audit of the Comptroller, id § 19(2)(b). As your office undertakes its review, please note that we have identified at least one category of fees in the submitted documents that we believe is not reimbursable—communications with the press. In addition, please note that the correspondence and documents indicate that although McDermott, Will & Emery at first did not apply a government discount to Mr. Bruno’s bills, the firm substantially reduced its fees after the initial bills were generated, Please let us know whether we can be of further assistance. Very truly yours, Near Harlan A. Levy Chief Deputy Attorney General & Counsel to the Attorney General cc: Governor Andrew M. Cuomo Senate Majority Leader Dean G. Skclos Assembly Speaker Sheldon Silver Cornelius D. Murray, Esq.