Akin Gump Seeks Six-Month Stall on Racketeering-Related Affidavits in Akron Bankruptcy

Akin Gump Seeks Six-Month Stall on Racketeering Related Affidavits in Akron: Lucky Star Analysis

(Cleveland, Ohio) – Jan. 15, 2021 -- In a move seemingly reeking of desperation, the law firm of Akin Gump Straus Hauer & Feld on Jan. 7 asked a federal bankruptcy court in Akron, Ohio,  for an “emergency” six-month delay in responding to racketeering related interrogatories requested by the Judge Allan Koschik https://cases.primeclerk.com/fes/Home-DownloadPDF?id1=MTc5NDgzNA==&id2=0  in November of 2021, according to publicly filed federal documents discovered by Lucky Star Communications, an Ohio-based communications firm.

The affidavits that were scheduled to be filed with the court on Jan. 8 2021 in In re: Pleasants Corp. Case No. 18-59763. They were  demanded of Akin Gump lobbyists Sean D’Arcy, Henry Terhune, James Tucker and Geoffrey Verhoff, who billed $2.8 million in Ohio state lobbying fees to forward the passage of Ohio H.B. 6. That bill gave approximately $1.4 billion in subsidies to First Energy Solutions, an operator of two nuclear power plants in Ohio that were said to be losing money.

Judge Koschik has ordered that a hearing be held on the “emergency” request via telephonic hearing on Jan. 19.

Four Ohio-based lobbyists for H.B. 6 were indicted on racketeering charges in a $61 bribery scheme designed to aid the bill’s passage. Also indicted in the scheme – allegedly Ohio’s largest governmental bribery ever – was Ohio’s then-Speaker of the House, Larry Householder.

Two of the Ohio lobbyists have pled guilty to the scheme, but none of the Akin Gump lobbyists have been charged with any crime.

In addition to his duties at Akin Gump, Geoffrey Verhoff serves as vice chair of the finance committee of the Republican National Committee.

The request for affidavits arose  because, according to court documents, Akin Gump employees were involved on almost a daily basis in consulting with the accused racketeers.

 According to court records, it was in fact a check from Akin Gump that actually served as the initial retainer to one of the racketeers who has pled guilty, Juan Cespedes.

The Ohio Consumers’ Counsel, a state agency charged with guarding the interests of the state’s energy consumers, filed an objection to the delay, stating that no valid reason for it had been given.  https://cases.primeclerk.com/fes/Home-DownloadPDF?id1=MTc5NTcwNg==&id2=0

The specific questions asked of the Akin Gump lobbyists, some of whom were attorneys, were as follows:

a. Describe your role in the 2018 and 2019 contests for the speakership of the Ohio House of Representatives. (All.)

 b. Describe your role in the 2018 general elections for the Ohio legislature. (All.)

c. Describe nature of your interactions and relationship with Juan Cespedes and the Oxley Group. (All.)

 d. What were the “parent developments” (August 1, 2018) and “past efforts” (September 10, 2018) referenced in Sean D’Arcy’s time entries for those dates? (D’Arcy.)

e. What was the “Columbus rollout” mentioned in Sean D’Arcy’s October 8, 2018 time entry? (D’Arcy.)

f. Describe your role in the Ohio House vote on HB 6 in April 2019. (All.)

g. Describe your role in the Ohio Senate vote on HB 6 in July 2019. (All.)

 h. To the extent not already answered in response to paragraphs 1f and 1g above, describe your role in the “whip counts” in 2019. (D’Arcy, Tucker.)

 i. What acts were involved in “mobilizing the HB 6 vote” in July 2019? (D’Arcy.)

 j. Did you or any other Akin Gump professional advise the Debtors with respect to the $1,879,457.00 electronic transfer to Generation Now on July 5, 2019, as 18-50757-amk Doc 4281 FILED 11/24/20 ENTERED 11/24/20 16:18:46 Page 5 of 6 6 disclosed in the Debtors’ operating report for July 2019 (Docket No. 3139), or regarding any other transfer to or for the benefit of Generation Now?

k. Were the Akin Gump Ohio statehouse team members aware of existence of Generation Now at any time before February 27, 2020 (the Effective Date of the Debtor’s Plan of Reorganization) and did they advise the Debtors with respect to any interaction with Generation Now during that time period? (All.)

According to court documents, the interrogatories above became necessary because the U.S. Attorney for the Southern District of Ohio David DeVillers refused on numerous occasions to provide relevant information to Judge Koschik on whether these racketeering related fees should be paid for out of the bankruptcy estate.

FirstEnergy, the parent company of FirstEnergy Solutions, is currently being investigated not only by the U.S. Attorney, the Public Utilities Commission of Ohio  the Securities and Exchange Commission, and the Attorney General of the State of of Ohio, David Yost.

According to court records, Yost believes that the entire bankruptcy claim was part of the fraudulent scheme. He hasn’t explained this in detail, but FirstEnergy Solutions, now renamed Energy Harbors, initially received a bid from Exelon, the nation’s largest generator of electricity from nuclear power, to buy them out of bankruptcy.

This offer was rejected, and FirstEnergy Solutions/Energy Harbor bonds fell into the hands of a number of Wall Street Vulture firms, which bought bonds for as low as .30 cents on the dollar and later converted the bonds into stock in the post bankruptcy firm.

In a surprise move made immediately upon leaving bankruptcy, the firm was drained of $800 million in operating funds, which went to buy out one set of Wall Street vultures for a huge cash profit.

 Two Wall Street vulture fund executives, John Kianni (formerly of Cove Key Management LP), now Energy Harbor executive chairman, and Stephen Burzanian (formerly of Avenue Capital Corp.), now the company's chief strategy officer, ended up running two of the country's most outdated and potentially dangerous nuclear power plants, both located in Ohio.

Currently, Nuveen Corp., a financial firm owned by TIAA, and Avenue Capital own virtually all of the company.

“They dealt out some of the nation’s most dangerous nuclear facilities as if they were poker chips,” believes Jeff Barge, CEO of Lucky Star Communications, an Ohio communications firm. “It was a high-stakes game of financial poker, and the financial vultures of Wall Street won – while the state of Ohio lost.”

Clean up of the two Ohio-based nuclear plants could cost in excess of $10 billion and take 60 years. Only $2 billion in funds have been set aside in a trust fund for the clean-up, leaving Ohio residents on the hook for $8 billion. https://bgindependentmedia.org/bankruptcy-court-ruling-could-leave-taxpayers-on-the-hook-for-nuclear-clean-up/

“It was a very canny use of the bankruptcy process by FirstEnergy and Akin Gump,” concluded Mr. Barge.