Ex-Speaker Mike Madigan, Illinois’ Capo di tutti capi
The corruption/bribery trial of the “ComEd Four” – Anne Pramaggiore, John Hooker, Jay Doherty and Michael McClain – is set to begin tomorrow, Tuesday, March 14. The spider at the center of this web is of course Michael Madigan, the former Speaker of the Illinois House of Representatives, who was indicted this time last year on charges stemming from the ComEd bribery scheme.
To make the long arm short, Commonwealth Edison’s Bribery Department (see July 20, 2020 Deferred Prosecution Agreement) offered its payroll and 1099 consulting gigs to Madigan as a patronage machine to perform for him the same function that the City of Chicago’s Streets and Sanitation Department used to perform for the late mayor Richard J. Daley back in the day. The trial will focus on the untrammeled control that ComEd and Exelon Corp., its dirigiste corporate parent, exercised over the Illinois General Assembly. Exelon had so many legislative victories in Springfield one might reasonably wonder if, as a recent orange politician once asked, they got tired of winning.
But ComEd’s influence over the General Assembly is one thing. Its influence over the Illinois judicial system is quite another, and the surface of that scandal hasn’t even been scratched yet. That’s what we’ll be addressing in the Sparkspread Blog going forward.
To understand ComEd/Exelon’s control over the Illinois judiciary, one must understand two things: first, Madigan’s control over the Cook County Democratic Party and its role in slating candidates for judicial elections; and, second, Madigan’s implicit, continuing obligation to safeguard the legislative victories he handed to Anne Pramaggiore. We’ll tackle the second one first.
Based on the July 2020 Deferred Prosecution Agreement, Madigan’s services to ComEd had a monetary worth of about $1,324,000, which is a pitiful sum in comparison to Larry Householder’s take from Ohio’s First Energy. But Madigan knew he had an obligation beyond just passing the legislation ComEd wanted. Madigan had to protect ComEd from actions by third parties that might diminish or threaten the value he was supposedly delivering to ComEd (i.e., favorable legislation). In this respect the ComEd-Madigan bribery arrangement is the same as a local mafioso’s protection/extorion racket. Madigan had a brand, a reputation for obtaining effective and lucrative legislative gains, to protect. The money ComEd paid to Madigan’s recommended persons was the protection money, or street tax, ComEd had to pay for Madigan’s benefit.
Yesterday’s article in the Chicago Tribune shows how Madigan’s protection racket played out in the ComEd bribery scheme when actions by third parties were concerned:
(Line blurs between politics, crime, Chicago Tribune, March 12, 2023).
Madigan had to kneecap the 2018 consumer protection bill to protect his client, ComEd. The effects on Illinois ratepayers were no less parasitic than that of a local mafioso on his own town.
Illinois is not the only place in which the speaker of the state house of representatives prostituted the civil power of the government in order to benefit the state’s largest electric public utility, not to mention himself and his cronies.
Today in Ohio a federal jury convicted former Ohio House Speaker Larry Householder, together with the former chair of Ohio’s Republican Party, of conspiracy in a $60 million bribery scheme in which Householder and his statehouse allies passed legislation to bail out two power plants owned by First Energy, the Ohio electric utility that serves 6 million customers.
The bribe money was also used by the Householder conspirators to thwart an effort to repeal the First Energy bailout legislation by referendum.
In Ohio that’s called “constituent service.”
Federal prosecutors, in their closing arguments, told the jury that all of FirstEnergy’s payments were secret and unreported, and that Householder and others knew the utility expected favorable legislation in exchange for its bribe money.
Now that the Madigan, Burke and ComEd Four trials are soon to begin, we’ll take a look at how the Madigan-ComEd-Exelon corruption metastasized throughout the entire political system of the State of Illinois – even into the Illinois judiciary.
For now, though, just note that First Energy had to funnel $60 million to Larry Houselholder in order to get its bailout legislation. Here in Illinois, though, ComEd only had to pay Madigan and his ilk a paltry $1,324,000 over ten years to get its legislation.
It may be quite a while before ComEd/Exelon gets a bargain like Mike Madigan again.
Today’s Chicago Tribune reports that Illinois Chief Justice Anne M. Burke has announced her retirement.
To the active and energetic mind, to the profound intellect, to the ever-restless curiosity, to the lifelong seeker after justice, the ease and indolence of retirement can often be harder to bear than continued labor in one’s metier.
Illinois Chief Justice Anne M. Burke will have no problems in this regard.
Although former Illinois House Speaker Mike Madigan may have wished that Illinois had a palace, its absence was no bar to the creation of his own palace clique of sycophants, not-so-brave adventurers, lobbyists, hangers-on, lackeys and lickspittles. And of this Madigan camarilla C.J. Burke was certainly the most important figure. Madigan had a live human wiretap into the highest, most important and most sensitive judicial deliberations in the state.
Madigan opposed the independent redistricting referendum, which came before the Illinois Supreme Court in 2016. Burke ensured that this measure, which favored voters’ rights and democracy in Illinois, was a non-starter. Any act or measure disfavored by Madigan that came before Burke’s Supreme Court would be condemned. In all matters Burke carried out Madigan’s will to the best of her ability.
Madigan, ever bashful, continually disclaimed having any influence or power over any one or any thing in Springfield, and he affected to be no more than a simple state rep and ward committeeman. But if he ever expressed his opinion on any issue, or, even less, granted or withheld his wink or nod, none could doubt what the final result would be. We miss Madigan’s ostentatious pretenses of powerlessness, humility, meekness and modesty. Well, at least we will until his criminal trial begins.
Then Commonwealth Edison’s Bribery Department (see July 20, 2020 Deferred Prosecution Agreement) offered its payroll to Madigan as a patronage machine to supply the place of Chicago’s Streets and Sanitation Department. The influence of Exelon in the Illinois General Assembly became paramount, and the interests of and protections for Illinois ratepayers concomitantly declined. Chief Justice Burke ensured that as far as Exelon’s bespoke laws protecting its revenues were concerned, constitutionality was nothing more than a dangerous luxury. With Madigan’s wink and under Burke’s watchful eye, Illinois legislation became Chris Crane’s own pull-toy. Sadly, Exelon must now do without either Mike Madigan or Anne Burke. Crane must know how Napoleon felt when he bade farewell to his Imperial Guard before setting sail for Elba.
Yesterday the U.S. Attorney’s Office for the Northern District of Illinois brought out its 22-count indictment of Michael (“I’m not the target of anything”) Madigan.
In July 2020, the U.S. Attorney’s Office entered into a Deferred Prosecution Agreement with Exelon Corp. and Commonwealth Edison Company, which served as Madigan’s political patronage machine for close to a decade. The DPA refers to Madigan as “Public Official A,” and includes messages from people in his corrupt network that refer to Madigan as “Himself” or “Our Friend.” It seems like Madigan was more popular among the federal prosecutors than he thought. In exchange for bribes to or for the benefit of Madigan, ComEd and Exelon ensured the passage of legislation favorable to them, and hindered or prevented legislation Exelon didn’t like.
If we could delve into the inner recesses of Madigan’s mind, we’d find that his Id, Ego, and Superego are all composed of one thing: a driving ambition to be the Second Coming of Richard J Daley. Madigan’s father and Daley the Elder became friends when both held political patronage jobs in the Cook County Clerk’s Office. Using political patronage, Daley the Elder went on to build one of the most powerful political machines that any American city had ever seen. During old Mayor Daley’s tenure, parts of Chicago’s government, like the Department of Streets and Sanitation, were turned into political patronage machines that Richard J. Daley used to provide jobs for his supporters.
One of old Mayor Daley’s chief precepts, which Madigan was later to adopt as his guiding principle, was to help your friends and either punish or co-opt your enemies. To Madigan, Daley the Elder had achieved what he considered political Nirvana: a world in which everybody both depended on you and was afraid of you.
But Old Man Daley passed away in 1976, and in 1983 the Shakman Decree ended Chicago city government’s role as a perpetual patronage machine.
Madigan’s alternative was to use ComEd and Exelon as a way to create a new political patronage machine and do an end run around the Shakman Decree. For Exelon and ComEd it was a match made in, well, maybe not heaven. As the DPA showed, bribery and corruption are integral components of Exelon’s business model: the utility parasite and the political parasite established a symbiotic relationship.
Over the next few weeks we’ll go further into the specific chapter and verse of the legislative benefits that Exelon and ComEd obtained at the expense of Illinois ratepayers. Nothing in the 22-count Madigan indictment revises the amount of bribes that Madigan directly or indirectly received: about $1.3 Million. We’ll tally up the economic benefits that Exelon and ComEd obtained from these illegal payments, and see how they balance out.
But Madigan and the Illinois legislature comprise just one sphere of influence. We’ll also take a look at how Madigan’s malignant principles have metastasized throughout the Illinois courts — an area the U.S. Attorney’s Office might be interested in. The General Assembly and the Illinois courts are the two poles between which the Madigan supremacy oscillated for nearly a half century. Within the courts Madigan’s fingerprints are harder to see, but it must be borne in mind that, whether Madigan was acting at one or the other of these poles, it was the Madigan supremacy still. His control was absolute and coordinate.
Constellation NewEnergy’s Third Party Investigator
The At Issue program on WBBM Newsradio (on Audacy) interviews Richard Dent, NFL Hall of Famer and MVP of Superbowl XX, concerning his legal battle with Constellation NewEnergy.
Also on the interview is Dr. Charles Steele, President and CEO of the Southern Christian Leadership Conference, the organization once led by Dr. Martin Luther King.
Constellation NewEnergy Terminates Dent’s Contracts and the Legal Battle
In 2018, Constellation NewEnergy terminated its energy contracts with Dent when two unnamed persons accused him of sex harassment and improper conduct. Constellation refused to disclose the names of the persons who had made these defamatory statements.
In 2019, we filed a Rule 224 presuit discovery petition in the Cook County Circuit Court to compel Constellation to disclose the names of Dent’s accusers. (Dent et al. v. Constellation NewEnergy et al., 2019 L 002910). Constellation filed a motion to dismiss the petition for failure to state a claim under Illinois Civil Procedure Code Section 2-615. When a defendant in a civil suit files a 2-615 motion, black letter Illinois law requires the court to accept as true, for purposes of that motion, all of the well-pled facts alleged in the complaint or petition.
In Dent’s case, though, the Circuit Court judge ignored the facts pled in Dent’s 224 petition and accepted as true facts that Constellation improperly added in its 2-615 motion. For example, Constellation NewEnergy refused to disclose to Dent the name of its third-party investigator, and that is exactly what Dent’s Rule 224 petition alleges. However, in a flagrant departure from the duties of a court in a 2-615 motion, the Circuit Court held that Constellation NewEnergy had disclosed the identity of the investigator.
During oral argument before the Circuit Court in July 2019, the trial judge agreed with me that Dent’s 224 petition was not a “fishing expedition.” (Dent et al v Constellation NewEnergy et al, 2019 L 002910, Transcript of Proceedings, July 19, 2019, at pg. 4, line 4 to pg. 4, line 20). Despite this, the Circuit Court denied Dent’s 224 petition on the basis of a case that prohibited the use of that rule for “fishing expeditions.” (Low Cost Movers v. Craigslist, Inc., 2015 IL App (1st) 143955). Low Cost Movers was neither relevant nor applicable to Dent’s petition, and neither Dent nor Constellation had cited it in briefing on the 2-615 motion.
Constellation NewEnergy told Dent, and the 224 Petition alleged, that it was going to terminate all of Dent’s contracts because of the allegations that had been made against him. Yet the Circuit Court held that the cause in fact and proximate cause of Constellation’s termination of Dent’s contracts was…(wait for it…wait for it…)…Constellation’s termination of Dent’s contracts. Yes, you read that right. (Dent et al v Constellation NewEnergy et al, 2019 L 002910, Memorandum Opinion and Order, July 31, 2019, pgs. 2-3). In the Cook County Circuit Court’s hands, cause and effect became fungible commodities. If I knew a first semester law student who committed so puerile a logical fallacy I would recommend (gently, of course) serious consideration of an alternative career.
We appealed this ruling to the First District Court of Appeals. In November 2020 the Illinois Appellate Court, without requiring oral argument, reversed the Circuit Court on grounds of abuse of discretion and held that Rule 224 was indeed the appropriate procedure for Dent’s case. (Dent et al. v. Constellation NewEnergy, Inc. et al., 2020 IL App (1st) 191652, 175 NE3d 742).
Constellation then filed a petition for leave to appeal with the Illinois Supreme Court, which that court granted in March 2021. The case was argued before the Illinois Supreme Court on September 22, 2021. You may replay the oral argument here:
Constellation NewEnergy’s Private Eye
In public statements Constellation NewEnergy claims that the allegations against Dent were “confirmed by an independent third party investigator.” That is their chief defense. But Constellation’s own allegations tell a different story.
At about 5:45 p.m. on July 10, 2018, Dent arrived at the JW Marriott Hotel at 151 W. Adams Street in Chicago, where Constellation NewEnergy had arranged for its golfing guests to collect passes and other items for their golf outing the following day. Constellation claims that an unnamed man, Person B, observed Dent at the JW Marriott, and Person B alleged that Dent was “drunk and disorderly” at that place and time.
After collecting his items for the golf outing, Dent drove from the JW Marriott to the Shedd Aquarium, at 1200 South Lake Shore Drive. As the crow flies, the JW Marriott is about 1.6 miles from the Shedd Aquarium. Dent arrived at the Shedd Aquarium at or about 6:30 p.m. on July 10, 2018.
Constellation NewEnergy’s pre-golf cocktail reception, where they alleged that Dent physically groped an unnamed woman (Person A), was held on the Shedd Aquarium’s patio. That patio is an open space overlooking Lake Michigan.
More than 100 people were at Constellation NewEnergy’s party at the Shedd Aquarium patio.
Dent had invited Sam Cunningham, the Mayor of Waukegan, to the Constellation NewEnergy cocktail party. Constellation knew that Dent had invited the Mayor of Waukegan to their cocktail party as his guest. Dent and Mayor Cunningham were generally in each other’s company throughout this event.
Constellation NewEnergy claims that the allegations against Dent were confirmed by a third-party investigator. This is more than curious because the alleged groping incident occurred on the patio of the Shedd Aquarium, an open space, in front of a crowd of more than 100 people, and in daylight. Yet the only person who Constellation NewEnergy claims witnessed this alleged groping is Person B – the unnamed man who was inside the JW Marriott Hotel — 1.6 miles away.
According to Constellation NewEnergy’s allegations, not one person – not one – who was at the Shedd Aquarium patio on the evening of July 10, 2018 witnessed any alleged groping by Dent.
According to Constellation NewEnergy’s allegations, Dent would have had to drive through downtown Chicago traffic, during the weekday evening rush hour, in a drunken condition, to get from the JW Marriott to the Shedd Aquarium. At these times the CPD usually keeps an eye out for drunk drivers, especially after “happy hours.” Dent was not stopped for any reason as he drove from the JW Marriott to the Shedd Aquarium.
According to Constellation NewEnergy’s allegations, Dent would still have been drunk at the Shedd Aquarium cocktail party, which immediately followed his visit to the JW Marriott. Dent was at Constellation NewEnergy’s cocktail party at the Shedd Aquarium for about an hour an a half. Yet Constellation NewEnergy does not allege, and has not presented any witness who has alleged, that Dent was drunk at the Shedd Aquarium event.
Though Constellation NewEnergy knew that the Mayor of Waukegan was Dent’s guest at the Shedd Aquarium party that evening, its supposed third-party investigator never called the Mayor of Waukegan to ask if he saw anything.
Based on Constellation NewEnergy’s own allegations, Person B, their supposed eyewitness, was not even at the Shedd Aquarium when the groping incident is alleged to have occurred. Rather, he was inside the JW Marriott Hotel at 151 West Adams Street.
The Witness to the Alleged Groping Had X-Ray Vision
As a kid I used to watch reruns of The Adventures of Superman (1952-1958) starring George Reeves as Clark Kent, the mild-mannered reporter for The Daily Planet newspaper. In that TV series, X-ray vision was one of Superman’s superpowers. Constellation NewEnergy’s independent third party investigator believes that Person B, their supposed eyewitness to the alleged groping, had X-ray vision better than Superman’s since Person B could see through 1.6 miles’ worth of concrete and steel buildings, all the way from 151 West Adams Street to 1200 South Lake Shore Drive.
Constellation’s Person B can see through tall buildings.
That’s quite a trick.
Constellation NewEnergy’s claim that it had an independent third-party investigator confirm the accusers’ allegations is inexpressibly ridiculous. Constellation refused to name its supposed investigator, perhaps to spare him or her being imprinted with a mark of indelible ridicule by having to explain how their only witness to the alleged groping saw everything through 1.6 miles’ worth of steel, concrete and downtown Chicago buildings.
Whoever Constellation’s investigator was, they make Inspector Clouseau look like Sherlock Holmes.
On August 18, 2020, I had the pleasure of speaking with Will Stephens, the host of Radio Station WXAN, regarding the recently filed civil RICO class action against Madigan, ComEd et al., filed in the U.S. District Court for the Northern District of Illinois. The link appears below:
On Tuesday, ISO New England, which operates the electric grid for certain states in that region (other than New York), issued a report that New England’s average annual real time wholesale electricity price for 2017 at $33.94 per megawatt-hour was the second-lowest price in fifteen (15) years. ISO New England stated that these low prices were driven chiefly by low prices for natural gas, the principal fuel used for generation at the margin, as well as reduced demand levels.
As earlier stated on the Sparkspread, for several years Exelon CEO Chris Crane has played the role of Peter the Hermit in the electric utility industry’s Crusade to rescue nuclear generation fleets from the infidels of the wholesale market. That is, he wants to make sure that electricity consumers make Exelon and other nuke operators whole for any losses they suffer because, contrary to their expectations, electricity prices have been hitting record lows in a number of markets, mainly due to low natural gas prices. When prices fell, Crane and his cohort lost no time in complaining about the “flawed market” for wholesale electricity.
If things had gone the other way – if electricity prices had risen to record highs instead of fallen to record lows – you can bet that Mr. Crane and his fellow nuke CEOs would be saying that electricity consumers must simply accept the results of the perfectly self-regulating free market in electricity, and if prices rise, that’s just, as they say in Brooklyn, T.S., Elliott.
Chicago, IL February 14, 2017: Chicago energy attorneys, Patrick N. Giordano and Paul G. Neilan, announced they filed a lawsuit in the U.S. District Court Northern District of Illinois today against Anthony Star in his Official Capacity as Director of the Illinois Power Agency. Village of Old Mill Creek, et al. v. Anthony Star was filed on Tuesday, February 14, 2017 at the U.S. District Court Northern District of Illinois.
Attorneys Giordano and Neilan represent Plaintiffs that are governmental, residential, commercial, and industrial electricity consumers located throughout the State of Illinois. Plaintiffs claim that P.A. 99-0906, executed by Governor Rauner on December 7, 2016, violates the U.S. Constitution’s Supremacy Clause, Commerce Clause, and 14th Amendment Equal Protection Clause. The underlying basis for the constitutional claims is that the prices charged by electricity generating plants are subject to federal rather than state regulation. A similar case has already been filed in federal court in New York challenging that state’s subsidy of Exelon nuclear plants by the law firm Boies, Schiller & Flexner, LLP, which is headed by preeminent attorney David Boies.
Among other things, P.A. 99-0906 is designed to subsidize Exelon Corp.’s Quad Cities and Clinton nuclear plants. This subsidy will be charged to all Illinois electricity consumers beginning June 1, 2017 regardless of what company supplies the consumer’s electricity. The lawsuit specifically asks that the U.S. District Court grant a permanent injunction blocking the charges from going into effect as scheduled on June 1, 2017. According to Mr. Giordano: “These additional charges will reverse twenty years of deregulation in Illinois which have given us perhaps the one advantage we have over neighboring states: relatively low electricity charges due to an effectively functioning competitive market.” Mr. Giordano also said: “We’re challenging the nuclear bailout provision of the legislation because the prices charged by electricity generators have already been established by the competitive wholesale electricity market subject to federal jurisdiction and cannot be increased by the State of Illinois.”
The estimated impact to all Illinois consumers will be about $3.3 billion over the ten years of the nuclear bailout. Mr. Neilan points out that: “This nuclear bailout is one of four rate increases to Illinois consumers this year, including increased delivery charges, increased renewable energy subsidies, increased energy efficiency subsidies, and these nuclear energy subsidies.” When the nuclear subsidies go into effect on June 1, 2017, Illinois residents and businesses can expect to see an average 3% increase in their electricity bills due to the nuclear subsidies alone.”
Giordano & Associates, Ltd. is Chicago’s first law firm devoted to energy issues. We provide clients with experienced counsel on regulatory, litigation, transactional, and legislative matters in the areas of electricity and natural gas. Pat Giordano can be reached at pgiordano@dereglaw.com.
The Law Offices of Paul G. Neilan, P.C. represents commercial, industrial and governmental energy users in disputes against public utilities, as well as in litigation and transactional matters with non-utility competitive energy suppliers.
FACT SHEET
Village of Old Mill Creek, et al. v. Anthony Star was filed in the United States District Court for the Northern District of Illinois on February 14, 2007.
The Plaintiffs are: Village of Old Mill Creek, Ferrite International Company, Got it Maid, Inc., Nafisca Zotos, Robert Dillon,Richard Owens, and Robin Hawkins, both individually and d/b/a Robin’s Nest.
The Defendant is Anthony Star in his official capacity as Director of the Illinois Power Agency.
This case arises from unlawful Illinois legislation that invades the exclusive jurisdiction of the Federal Energy Regulatory Commission (“FERC”) over “the sale of electric energy at wholesale in interstate commerce” pursuant to the Federal Power Act. 16 U.S.C. 824(b)(1).
The unlawful legislation is contained in subsection (d-5) Zero Emission Standard of Illinois Public Act 99-0906 (“P.A. 99-0906”), which was enacted on December 7, 2016 and is available at http://www.ilga.gov/legislation/99/HB/09900HB65761v.htm.
Subsection (d-5) Zero Emission Standard of P.A. 99-0906 requires the Illinois Power Agency to procure contracts for Illinois utilities Commonwealth Edison Company, which serves northern Illinois, and Ameren Illinois Company, which services central and southern Illinois, for purchases of Zero Emission Credits (“ZECs”) from nuclear-fueled generating plants.
The ZEC payments will be passed through by the utilities to all Illinois consumers through automatic adjustment tariffs.
A. 99-0906 is designed to provide additional revenues to the Illinois-based Quad Cities and Clinton nuclear plants.
Exelon Corp. owns both the utility ComEd and Exelon Generation, which owns the Quad Cities and Clinton nuclear plants that will sell the ZECs to the utilities.
Although P.A. 99-0906 has many other provisions, this case concerns only subsection (d – 5) Zero emission standard.
Plaintiffs are not challenging any other provisions of P.A. 99-0906. Section 97 of P.A. 99-0906 provides that the provisions of the Act are severable under Section 1.31 of the Illinois Statute on Statutes. 5 ILCS 70/1.31.
In New York, ZEC payments to Exelon nuclear plants in that state are being challenged on the same grounds set forth by Plaintiffs in Illinois. Coalition for Competitive Electricity, et al. v. Audrey Zibelman, et al. was filed in the U.S. District Court Southern District of New York on October 19, 2016.
A typical residential customer using 1 mWh (1,000 kWh) per month would pay an additional $2.64 per month beginning June 1, 2017 based on the initial ZEC price established in P.A. 99-0906.
A manufacturing company using 10,000 mWh per month would pay an additional $26,400 per month beginning June 1, 2017 based on the initial ZEC price established in P.A. 99-0906.
The history of the Big Bank Bailouts of 2008-09 is now repeating itself as farce. The 2016 tsunami of crony capitalist entitlement is scheduled to hit Illinois tomorrow in Clinton, where according to news reports Gov. Rauner will sign the Exelon Dividend Protection Act. We’ll have to more to say on the legislation, but one may read the story here.
Energy Law, Policy and Development 