Gambling promoters from the U.S. Virgin Islands have spent nearly $2.1 million on their campaign to bring slot machines to the nation's capital, according to the latest campaign finance records. Much of the money has been used to arm a battalion of lawyers to defend the campaign against charges of massive election law violations.
But one attorney hasn't been paid in full: John Ray, who served as the public face of the slots initiative.
Since at least January, the slots campaign has owed Ray and his law firm, Manatt, Phelps and Phillips, a cool half-million dollars -- $533,118, to be exact. The bill is now the subject of a dispute between Ray and the St. Croix crowd, who have accused the former council member and four-time mayoral candidate of legal malpractice.
Both sides declined to publicly discuss the disagreement, which is pending before the D.C. Bar Association's Attorney-Client Arbitration Board.
But Deborah Deitsch-Perez, a Dallas attorney who represents gambling impresario Shawn Scott, confirmed that she has petitioned the arbitration board to decide whether Scott suffered monetary damages as a result of Ray's representation before the D.C. Board of Elections and Ethics.
Deitsch-Perez wouldn't discuss specifics. But the anti-slots activists who accused slots supporters of forging signatures during a July 2004 petition drive have long questioned Ray's performance during public hearings before the board of elections last summer.
At the time, gambling opponents said they were surprised that some witnesses they called went unchallenged by Ray and that witnesses who might have been expected to help Ray's case never materialized.
Last month, the elections board levied a fine of $622,880 against the slots campaign, the largest ever assessed for violations of city election laws. By then, Ray was long gone, having been replaced by George W. Jones Jr., a former president of the D.C. Bar.
The fine is a tiny fraction of the vast sums Scott and his friends stood to gain if Ray had successfully navigated the elections board. Had D.C. voters given their consent, Scott would have won the right to build a gambling hall with 3,500 slot machines in Northeast Washington, a project that would have generated an estimated $765 million a year in revenue.
That plan must have sounded awfully good when Scott and his associate, Rob Newell, showed up in Ray's law office in April 2004. Ray quickly recruited a local businessman, Pedro Alfonso, to chair a political action committee for the slots campaign; Ray's longtime aide, Margaret Gentry, served as the committee's bookkeeper. And Ray himself served as chief spokesman in the news, in court and before the board of elections.
Alfonso stood to win big if the plan succeeded: According to a consulting agreement with one of dozens of corporate entities created by Scott and Newell, Alfonso was to be paid a $1 million "success fee" if the initiative won voter approval and an additional $2 million if Scott and his friends won a gambling license in the District. (Scott has tried unsuccessfully to win gambling licenses in several states, including New York, where regulators last month rejected his bid to operate an upstate horse track.)
Ray, meanwhile, racked up huge legal fees, billing the campaign for more than $870,000, according to campaign finance reports. Scott and his associates had paid about $340,000 when the checks stopped coming.
In a separate proceeding before the arbitration board, the two sides are also fighting over the amount of Ray's fees, Deitsch-Perez said.
Ray did not return calls about the malpractice allegations. His firm referred questions to lawyer Pamela Bresnahan, who declined to discuss the matter.
"As far as I know, we have a confidential proceeding that I'm not going to talk about," she said. "I'm going to try to have it resolved so that John Ray doesn't have to deal with these people anymore."
Moving and Shaking
* More fodder for the Robert C. Bobb rumor mill: The Plain Dealer in Cleveland reported that Bobb is a potential candidate to replace Cleveland schools chief Barbara Byrd-Bennett, who announced her resignation Friday. Bobb said that he knew nothing about the job and that he hadn't spoken to anyone in Cleveland, "cross my heart, hope to die, on my grandmother's grave."
* Clinton LeSueur, a Mississippi Republican who twice failed to win election to Congress, turned up among the ranks of eager young things working for mayoral candidate Adrian M. Fenty. Fenty (D-Ward 4) paid LeSueur $7,750 to make a few calls about fundraisers, according to campaign finance records. The former resident of Ward 4, who once worked for the D.C. Council, has moved back south, Fenty said.
* Michelle J. Walker, the mayor's senior adviser for education, will join school Superintendent Clifford B. Janey's staff Monday as chief of strategic planning and policy. Walker is the second staffer to move from the John A. Wilson Building to the school system's headquarters in recent months. JoAnne Ginsberg, longtime education adviser to council member Kathy Patterson (D-Ward 3), was appointed last month to fill a vacancy on the Board of Education.
Staff writer V. Dion Haynes and researcher Derek Willis contributed to this report.