NEWS

Marionneaux faces ethics charge over suit against LSU

DEIDRE CRUSE, Governmental Reporter

The Louisiana Board of Ethics has charged State Sen. Rob Marionneaux, D-Maringouin, with failing to disclose his legal  representation of a client in a lawsuit against state-funded LSU.

The attorney representing the LSU Sysem in the case, General Counsel Ray Lamonica, said Marionneaux proposed to settle the dispute for $7.1 million from LSU and $5.5 million in state funds that Marionneaux planned to seek from the Legislature.

Marionneaux, an attorney, represented Bernhard Mechanical Contractors Inc. for a contingency fee based on the amount of any settlement in the case, the ethics board said.

Marionneax told the POST/SOUTH the ethics board wrongly charged him with failing to file a report within 10 days of his hiring by Bernhard.

“All the other stuff has been examined [by the ethics board] and found to be unfounded,” the senator said.

Marionneaux said a rule requiring the disclosure has “never been a rule before.” He said it was the result of an interpretation the new board of ethics made in May 2009.

“I think their interpretation is wrong,” he said. “We have never been required to file the report and should not be required now. The Supreme Court regulates the practice of law. I think the charge is unfounded in itself.”

Marionneaux refused to discuss whether he had tried to get state money allocated to settle the lawsuit or other aspects of the case.

“The only charge against me is failing to file a 10-day report,” he said.

Ethics Board Chairman Frank P. Simoneaux informed Marionneaux of the charge in a letter dated July 28: Based on the findings of a private investigation, the board ordered public hearing for Marioneaux before the Ethics Adjudicatory Board.

Ethics Administrator Kathleen Allen said Tuesday a hearing date has not been scheduled.

According to the ethics board's findings:

LSU had a performance-based/energy efficiency contract with Bernhard to install a cogeneration plant at the Baton Rouge campus starting in early 2003. In early 2006, the university filed suit alleging Bernhard had not delivered the energy savings stipulated in the contract. Bernhard countersued. Eventually, the case was remanded to the site commissioner of administration. Mediation efforts failed.

Bernhard hired Marionneaux around April 2008, and Marionneaux informed the LSU System by letter in August.

“As compensation for his legal services, Bernhard Mechanical agreed to pay Mr. Marionneaux a contingency fee based on the amount of money it might recover,”  Simoneaux said in the letter.

At Marionneaux's request, LSU officials met with him on May 27, 2009 in the Senate president's conference room to discuss a settlement.

“Mr. Marionneaux led the settlement discussion...and stated Bernhard Mechanical would settle for $7.1 million from the LSU system and $5.5 million from the state. He indicated that funding of the state's portion would be secured through legislative appropriation.”

“LSU was going to settle the deal for a little over $7 million,” Lamonica of LSU told the POST/SOUTH. “Marionneaux shows up, not the normal litigation attorney. He [the senator] was hired late in the process. He was proposing that he will cause the Legislature to appropriate $5.5 million...He proposes that and has a contingency fee agreement and will get a portion of the $5.5 million. He has a requirement to file a report so everybody will know about it and evaluate it.”

Lamonica refused the proposal in a letter dated June 1, 2009.

“You indicated you needed a prompt response to be abel to get the matter through this legislative session since the appropriation process is currently in the Senate and time is critical,” he wrote Marionneaux.

LSU always contended that only LSU, and not the state, was obligated on the contract, Lamonica said.

“Considering the issues in the on-going civil action with Bernhard, the totality of circumstances of our proposal, and the budge cuts resulting in the failure of LSU to receive funding in areas normally funded by the state, LSU cannot accept your proposal that the state (which we continue to believe has no legal obligation to Bernhard or LSU in the dispute) appropriate $5.5 million for the purpose of settlement with your client...”

Lamonica said as far as he knew the funds never were included in any legislation.

“To my knowledge Marionneaux was only involved in the proposal of the $5.5 million,” the general counsel said.

LSU rejected the settlement, but later the two parties did arrive at an agreement.

According to the ethics board, Marionneaux violated state law by failing to to file a sword statement after “he received or agreed to receive or both a thing of economic value for assisting Bernhard Mechanical in a transaction or in an appearance in connection with a transaction with the state of Louisiana or its officials or agencies...”

“In time, the courts will rule that there is no such requirement,” Marionneaux said.