by Jack Douglas | CBS11
DALLAS (CBS11) – A representative for billionaire Ross Perot Jr. testified Monday in the federal corruption trial of Dallas County Commissioner John Wiley Price, describing competing interests in massive real estate developments in south Dallas County and north of Fort Worth.
The FBI has accused the embattled commissioner of taking bribes to stall the Dallas development’s designation as a federally recognized Foreign Trade Zone, even though it would have helped Price’s economically depressed district.
Michael Berry, with Hillwood, testified about the company’s Alliance Corridor, mostly in Tarrant County, about half of which is also designated as a Foreign Trade Zone.
Berry told jurors there were concerns at Hillwood that the Dallas County’s upstart trade zone, also known as FTZ, would siphon federal dollars away from Alliance for new infrastructure.
An FTZ designation is a powerful tool in developing inland ports for the trade and distribution of overseas goods, primarily by providing areas — close to airports, railways and major highways — with relief from custom duty fees and other tariff costs.
At the time, between 2005 and 2006, Kathy Nealy worked as a lobbyist for Perot’s company and its efforts to first compete with the project in Dallas, and then later to be a part of it.
Nealy is charged as a co-conspirator with Price, accusing her of receiving payments from various companies, including Hillwood, and converting chunks of it into bribes for the commissioner.
In exchange, the FBI alleges, Price would use his influence as a powerful elected official to direct lucrative contracts and business to Nealy’s clients.
The federal corruption trial began the day with testimony from a vendor who said she grew frustrated when her bids for work didn’t get passed Price.
Kate Connolly, who in 2007 was with Unisys, an IT company, said that “shockingly” her company finally won a contract with the county to provide inmate phone service at the jails, but it came after two failed attempts at other contracts.
The inmate phone contract was won after Connolly and another Unisys executive had a lunch meeting with Price and his friend, Nealy. That meeting came during a county-enforced “no contact” period that prohibits elected officials from meeting with companies while they have bid proposals pending.
Connolly told jurors there was “absolutely nothing discussed” about the pending inmate phone contract when she lunched with Price.
The long-time commissioner and his executive assistant, Dapheny Fain, are in a federal courtroom, both charged with corruption, bribery and tax fraud. Nealy is charged as a co-conspirator, but is scheduled to be tried later.
Price’s and Fain’s trial began its third week, filled with technical data and complex financial transactions, all captured in dozens of file boxes that adorn the courtroom.
On Monday morning, jurors were seen yawning, rubbing their eyes and stretching their arms. One jury member briefly rested his head in his cupped hand.
In later testimony, Reginald Drake, another Unisys official who attended the lunch with Price and Nealy, said the encounter took place at The Palm, a high-end restaurant on Ross Avenue.
Like Connolly, Drake said Unisys’ pending contract proposal with the county was never mentioned.
He also said he would not have agreed to the meeting if he’d known Nealy was at the time paying Price — something the government alleges was in the form of bribes — “because I consider it to be unethical.”
In cross-examination, Drake, who is now retired, told defense lawyer Chris Knox he remembered Price being very knowledgable about county government business, and that the commissioner never made any demands during the lunch.
The jury also heard from Gary Miglicco, an executive in 2005 with the company, BearingPoint, when it won a multimillion-dollar contract to digitize and maintain county records.
The FBI has said there was no evidence companies knew their money to Nealy was being converted into bribes for Price. However, another executive with BearingPoint, Helena Tantillo, has been sentenced to six months in federal prison after admitting to lying to agents about giving Price $7,500 before the company won its contract to maintain county records.
Miglicco said he was not aware that much of the money BearingPoint was paying Nealy, as a lobbyist, was being passed on to Price. If he had known, he said, he probably would have fired Nealy because he would have been concerned her payments to Price were “inappropriate.”
The jury also heard from David Newsom, now retired as chief counsel for Hillwood, who said he hired Nealy to get “credible access to decision makers” in North Texas.
Part of Nealy’s role, Newsom said, was to “help me get an audience” with Price, in Hillwood’s attempts to be a part of the FTZ development in Dallas County.