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Posted at 05:19 PM ET, 09/16/2011

Lottery contract wrangling detailed in court filings


New court records provide new details about Gray’s role in a lottery deal. (Sarah L. Voisin - The Washington Post)
Three and a half years after it started, the troublesome procurement of the District’s lottery contract continues to be a political headache for top city officials.

As the Washington Times reported this morning, Eric W. Payne, a former contracts director in the Office of the Chief Financial Officer, filed documents yesterday in federal court laying out the efforts to derail the original contract award after it went to the D.C. Council to approval in the spring of 2008.

The winning firm was a joint venture named W2I, composed of international lottery firm Intralot and W2Tech, a local start-up owned entirely by Alaka Williams and her husband, Warren C. Williams Jr.

The filings come as part of a lawsuit filed last year by Payne against the District and Chief Financial Officer Natwar Gandhi alleging wrongful termination and whistleblower retaliation. As part of his lawsuit, which has already survived a dismissal motion, Payne has requested depositions from Mayor Vincent C. Gray, and Council members Jack Evans (D-Ward 2) and Jim Graham (D-Ward 1).

All three filed motions opposing the deposition request, claiming they are immune from having to testify about legislative matters. Payne’s filings seek to show that their intervention in the lottery award went beyond the “legislative functions” protected by law.

The picture painted by the filings is one that followers of the contract saga have already seen — that some Council members, particularly Graham, were not happy to find out that Warren C. Williams Jr., formerly the owner of a controversial nightclub, was involved in the winning bid, complicating its approval. But the filings paint that picture in awfully colorful strokes, describing a “multitude of inappropriate attempts to influence or change the contract outcome.”

The court records describe a series of meetings, including one in April 2008 between Evans, Gandhi and aides. From the filing:

There was no discussion about the technical solution offered by Intralot or its price. Instead, it was about political support on the Council for the contract and the looming showdown between then D.C. Chairman Vincent Gray and then Mayor Adrian Fenty. Evans went on to expressly ask: “[c]an’t we just get rid of Williams, who apparently is a slumlord who everyone has a problem with, and replace him with [former contractor Leonard Manning]?” ... [Payne] stated that it was “legally impermissible to get rid of Williams,” to which Evans retorted “why not?” and to which Gandhi said, “yeah, why not?” Payne and Young then reiterated that they could not ethically or legally force Intralot to select another partner ...

Evans had no comment Friday. He later recommended approval of the contract.

Payne also describes Graham asking him to contact a political ally, Dotti Love Wade, about the contract. Wade, he said in the filings, “raised vague concerns” about Williams’ capacity to handle the contract. But Payne also says that the winning bidders reported to him that Wade had offered to deliver Graham’s support in exchange for “a ‘stay at home’ job, a car and other perks.”

Asked whether she had sought favors from the contractors, Wade said “absolutely not.”

At a May 5, 2008, meeting, Payne met with Gandhi and Gray, who said he would not proceed with the contract. From the court record:

Immediately after the meeting, Gray asked Gandhi to remain behind. They met privately as Payne and other staff waited in Gandhi’s office. After the private meeting, Defendant Gandhi summoned [Payne] into a meeting with [OCFO executive Angell Jacobs] and other staff and repeatedly cajoled Payne to cancel the proposed lottery contract and reopen the process. [Payne] resisted and advised the CFO that there was no legal basis upon which to do so and that the contract’s cancellation was legally impermissible. Apparently, the CFO was being pressured to end the contract award and to demote and/or terminate [Payne] in order to remove his aggressive insistence on following objective, impartial and legal contract procurement procedures.

Two months later, Payne was demoted. He recorded the meeting where his supervisors told him why. Jacobs, his boss, explained that the contract had become a flashpoint in tensions between the mayor and Council, and that “for Gray and Graham, this is all personal.”

”Jim Graham is on a personal vendetta here and, you know, he thinks the way to get what he wants is to find a way to discredit the people that were involved in the process,” she said.”And he doesn’t care who that involves.”

Graham declined to address the specifics of Payne’s allegations, because he is currently seeking to assert a privilege not to address the case in court. But he said “what’s being said there is not true” and that Payne’s claims are “simply the allegations of a complainant who lost a job.”

On Jan. 9, 2009, according to the lawsuit, Payne was fired. Several months later, the lottery contract was opened for another round of bidding. Though Intralot had threatened to not participate in a rebid, they did indeed — without a local partner — and won a second time. When that contract came to the Council for approval, Intralot added a new local partner with political ties to Gray.

David Umansky, a spokesman for Gandhi, declined to comment on the particulars of Payne’s claims, citing the ongoing litigation. “The procurements were transparent, open and done strictly according to the law,” he said.

By  |  05:19 PM ET, 09/16/2011

 
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