Live Blog: Kwame Kilpatrick Trial Day 21 - DC News FOX 5 DC WTTG

Live Blog: Kwame Kilpatrick Trial Day 21

Updated:
DETROIT (myFOXDetroit.com) -

And we'll all be back on Monday.  M.L. Elrick will have wrap up of today's testimony on Fox 2 tonight at 5 and 6 and you can catch his Daily Takeawy on MyFoxDetroit.com.  Have a great weekend.

1:01

Jury is excused for the week and attorneys are now having a sidebar with judge.  They are ironing out some more hearsay issues and the Judge is telling prosecutors that they'll have to have witness lists to the defense team this afternoon.

The gallery is filing out of the Court Room.

12:58

Hardiman says Bobby didn't want to be on bid team but did want to work on the project once Lakeshore got the project.  SAys they agreed to let Bobby do some of the dig-ups. 

SAys at one point Bobby was on the site telling the current contractor to get off the job, the firm that actually had the sub-contract, Bobby refused to let the company work so Hardiman says he told the guys to stop and let Bobby do it.

Showing an email now from VP of Lakeshore saying do not start any more sites.

Chutkow asking if this is regarding Bobby's interference, says yes.

Chutkow's asks if Bobby made a Threat.  Hardiman says Bobby would shut the fling jobs down."

12:50

One last contract dws865, Looking at the proposal documentation.  Bid team is D"Allesandro, Lanzo, Superior, Lakeshore is prime, A&H, Cole Financial.

Shows that Cole and A&H are small, Detroit Based and Headquarter companies.

Chutkow asks if FErguson was asked to be on team. Hardiman says more that likely yes. 

12:43

Now talking about Fox Creek Home Development on Detroit's East Side. A&H had a subcontract with Lakeshore to do Water Main Work.  SAys at this time Bobby was threatening to have his contracts stopped if he didn't play ball.  Says because he was a subcontractor he had to let RAchmale make the decisions and Rachmale said he didn't want to jeopardize the contracts.

Looking at a bunch more checks now, these are to FEI for Fox Creek.  Says this is for work bobby's company actually did.  Says this wasn't money for nothing.

$1,322,048 from A&H on Aug 17 2007, $50,837 Nov 2 2007 from A&H to FEI, $Dec 13 2077 $27,827on  FEb 1 2008, $58,000,on Dec. 5 2008, $65,405, Jan 14 2009 18,328, 

Total is 1.4 million

12:30

looking at checks now $55,000 and $23,322 payments to Excel, can't remember if there were particular services provided.

$100,000 check to Excel

$50,000 to excel

these are from 2007

Another $22,222 check from 2008

$200,000, and $150,000 to round out the deal.

12:22

Now looking at checks from A&H to Bobby. Hardiman says Calvin Hall one of the Excel owners, would come to the Lakeshore office, sit and listen at meetings.

Chutkow asks what Hall contributed of value. Hardiman says he doesn't know. Adds that Hall never gave A&H any help. Hardiman says he called Hall a parasite for requesting payment for services he didn't deserve. Hardiman says he paid him "because Bobby Ferguson has a relationship with the people downtown."

12:17

Hardiman says he thought Bobby was insane and didn't want to pay him. Talked to Rachmale as was told to "work it out."

Says they paid because "it was Bobby Ferguson."

Hardiman says all his decisions were based on losing those first two contracts. Says it was better to make a little profit than no profit.

Now looking at a pay request printed by his company to pay Excel.

Chutkow asking if Ferguson requested that A&H pay Excel, Yes.

The document says the payment is a management fee to be picked up by Bobby.

12:12

Hardiman says after the bid was submitted he got a call from the Contracts and proposal dept of DSWD asking about A&H's certification as a Detroit Headquartered business. It was certified and that cert was supposed to be good until 2008.

Hardiman says he talked to Bobby about it and asked him to look into it. Says bobby did and cert was okay. Eventually got contract and included Lakeshore in the job.

Says various companies did the excavation. Says Excel company did consulting and Bobby asked to have Excel on contract. Hardiman says he asked Bobby why and Bobby said they need to help you out.

Hardiman says Bobby wanted him to pay Ex cell 400,000.

12:05

Now looking at the bid proposal. Hardiman says ENT Trucking to get 15% but wasn't sure if that was Bobby's idea.

12:02

Now looking at a construction management contract for improving water mains in City. Hardiman says there were bidding the contract with McCormick, D'Agostni, and others. Along with Hardiman's company A&H. ENT trucking is on bid, says Bobby introduced him to ENT. Says Bobby was exclusively on another bid.

11:58

Chutkow asking if Bobby knew when Lakeshore was going to be granted change orders. Hardiman refers to one contract and says yes.

Chutkow now asking about Sky Group. Hardiman says Bobby would come in a say I want to be part of this or I want to be part of that. Sky Group owned a building on Woodward. This is the one that now houses the police department. A lease arrangement.

Hardiman says Bobby came to him and said I need to be a part of this. Hardiman says his original thought was that Bobby was insane.

Says Christine Beatty was over seeing Mayor's affairs at the time and over seeing the police department.

Hardiman says it was the 14th precinct and various departments that were moved into the building.

11:54

Hardiman says he didn't tell Bobby they received a payment. Bobby seemed to know. Hardiman says Bobby knew when they got paid.

11:50

Chutkow asking about payments on the outfalls contract. Hardiman says they didn't pay Bobby all at one time. Says Ferguson would call him and tell him he'd be bringing over an invoice. Says he made his calls right after Lakeshore got paid by the city.

11:47

Court is back in session. Thomas Hardiman is still on the stand. Mark Chutkow for the prosecution will be doing the questioning. The jury if filing in.

11:27

And Judge Edmunds calls for a break. THe defense team clears out, the prosecutors and gathered at their table.

11:25

Hardiman says another Lakeshore company, Sky Group, the real estate company, was cutting checks to pay the $1 million because there was no contract with Johnson Consulant. SAys he didn't want his employees gossiping on the street about why Lakeshore was paying Bobby Ferguson but funneling it through another company.

11:21 Hardiman Says Bobby never told him why the Invoice was from "Johnson Consulant" and not from one of Bobby's companies.

Hardiman says he not aware of any work done on any of these contracts by Bobby.

11:18

Now looking at an invoice from "Johnson Consulant Services" the name is misspelled. Hardiman says it's for inspection services that were never provided. The total is $450,000 which represents the money for the percentage of the change orders on the outfalls and asbestos contracts.

Less payment received is $25,000. The cash payment.

going through it line by line now. Lists a bunch of services. When asked if Bobby provided the services Hardiman answers, "I don't know.

11:11

Hardiman now describing how he made his first payment to Bobby. Says Bobby called him a said he wanted $25,000 "TODAY." Hardiman says he panicked and thought Bobby meant cash because Bobby asked for it today. Hardiman says he took the $25,000 in cash to Bobby.

11:08

Referring to an asbestos removal contract awarded to Lakeshore...and change orders that Bobby wanted on another contract. Hardiman says he didn't want any problems on the asbestos contract so he was dealing with Bobby on the change orders.

SAys he wanted to leverage his relationship with Bobby. Bobby wanted 5 percent of the change orders to the outfalls contract in addition to the $1 mill original contract. Would also pay him $75,000 for the asbestos contract even though Bobby had no role in the project.

So Hardiman says Bobby wasn't' doing any work on the outfalls contract, didn't have a role in the asbestos contract but says even though he wasn't happy about it Hardiman thought it was prudent to pay.

11:01

Now looking at letter from Mercado authorizing work to start immediately.

Hardiman says he had a meeting with Staple ton, Angelo, and Bobby. Had a conflict between what Bobby and Angelo were going to do. D'

Angelo worried that he wouldn't have any work to do. Said Bobby was taking all the work. Hardiman didn't care who did the work but if it came down to it, Bobby would do the work, so the contract wouldn't get canceled.

says an arrangement was ultimately between Lanzo and Bobby. Says Ferguson wanted certain line items on the contract. Agreed to pay Ferguson $1 million to do NO work. Out of profits from Lanzo and DCG (D'Allesandro)

10:50

Now looking at a letter from DSWD contract manager Latimer regarding the "outfalls." says 80% of personnel were from Detroit. Says Lakeshore will provide insurance and performance bonds.

Says construction manager would be like being the quarterback. Lanzo contributed. Says he's not sure what Bobby did at time to assist. Ask Rachmale.

Judge would not allow Chutkow to ask Hardiman what Rachmale said about having Bobby on team.

10:46

Says he saw having Bobby on the team as a benefit because Bobby could do the work and knew City Hall.

Looking at a text message not that Hardiman sent to Bobby:

"Don't forget to call Victor MErcado." Jan 26 2004

Says Bobby has a relationship with Victor, the Mayor, Derrick. Wanted everyone to know Bobby was on the team. Says Bobby had strong relationships that he didn't have that would help them win the contract.

Says Jim STapleton a consultant for D'Allessandro was at one of the meetings. Says D'Allessondro (DCG Chief) wasn't happy to have Bobby on team but he didn't care because Bobby was the guy.

Profits would be split in thirds.

10:40

Says Lakeshore would be the construction manager, Lanzo would do the lining, Ferguson would be excavation, repair.

Hardiman says someone told him to talk to Bobby about the contract proposal. Says after losing the previous contracts, knowing that Bobby's contracts didn't get canceled, he was the guy to have on the team.

10:35

Hardiman says Rachmale was devastated, kept asking if they did anything wrong.

Says they got busy going after work on the Federal end and other city projects.

Looking at a photo now of "outfalls" that lead into Detroit River. This is a huge concrete structure, crumbling, with hoses and lines, snaking down from the top. It's the last place treated water flows out into the river. It's a mess, falling apart.

Hardiman says he teamed with Lanzo Lining, Ferguson, to submit bid for reconstruction.

10:30

Now looking at a letter from Mercado to Rachmale's about $10 mil contract, regrets to announce that contract has been canceled and work will be performed through existing contract. Not one that Lakeshore had. Found out it was going to be INland Waters one of Hardiman's competitors.

Hardiman say he was stunned, disappointed, angry, concerned.

Says he didn't know at the time that Bobby was on the INland Waters team. Learned about it later but not sure when.

10:27

Hardiman says he went to first Ferguson meeting with Rachmale. SAys he asked Bobby if he knew anything about the contracts. Says Bobby said, "I don't know why I'm here?" Told Hardiman nothing.

At second meeting the same thing, no answer. Chutkow asking if Bobby understood Hardiman had a minority run firm. Yes.

Then met with Derrick Miller, Hardiman says he was trying to meet with the Mayor. Says Miller didn't have any answers either, told him it was Mercado's decision.

10:25

Now looking at April 23rd 2003 agenda for water board commissioners meeting. There's an entry telling Director to enter into negotiations with Lakeshore. on top of the entry is says "pulled."

Hardiman says he didn't understand why it was pulled, Board wasn't considering it that day. Says this was all after he met with Bobby. Says Bobby was interested in $10 million contract.

Next document is Letter from Mercado to Rachmale, May 16, 2003. Says the project is canceled

Hardiman says he was shocked...angry...there was no logical reason for it to happen.

ASked an ex partner of Lakeshore what he should do and the guy told him to have a meeting with Bobby Ferguson. Says he didn't have anything to lose so he met with Bobby.

10:17

Chutkow now introducing a check to Maestro Associates from Lakeshore for $2500. Consulting fee. This is Bernard's company.

Hardiman says he had a conversation with Bernard about the contracts. Met with Bernard, "being the Mayor's Dad."

Bernard told him he's look into it, always called him back, but never came up with reason for status of contracts.

10:15

Chutkow asking if Hardiman talked to Sandra Tenay Ramsey... Mother if Kandia and Dedan Milton. Says she's a friend of his. Says he had a $10 mil contract and $5 mill contract that were axed, he started calling everyone he knew, called Dedan. Hardiman is animated for the first time this morning. Says he called everyone he knew because the contract was sitting on someone's desk.

Says a big chunk of net revenue was being taken away.

Says Ramsey told him her son could not respond. Says he talked to a lot of people at that time and no one gave him answers.

10:08

The Judge says again, in this case, the hearsay statement is not being offered for the truth of it, just to the witness' state of mind. The objections here are that the what Carolyn Cheeks K said can't be verified. THey can't ask her if that's what she said.

10:08

It looks like the Judge may have been having some issues with the electronics on her desk. It looks like Josh has it sorted out and court is back in session. Thomas is asking about the ruling during the sidebar.

Thomas says witness is not talking to "climate of fear." Judge says it's just being offered to the witness' state of mind. Judge says the testimony about what Carolyn Cheeks Kilpatrick said doesn't matter because it wasn't offered for the truth just what Hardiman did next.

Minnock is weighing in now but he's off mic

The judge says if the witness was saying he was told he had to pay so much or get shut down then that would be hearsay, but, there's an exception for racketeering cases.

Interesting legal lessons hear about what can and cannot be said in court...and why.

9:58

The feed dropped out during the sidebar, which is over now. The Judge snuck out of the room when the picture was off. No work yet on what is going on but it looks like the head IT guy Josh is consulting with the Judges aids. He's having one of the other IT guys check the mic's. The judge is back and part of the consultation. I didn't see her in the throng at the bench.

9:55

Techs are rebooting the overflow camera system, right now the attorneys are milling about the room. Hardiman is sitting in the witness stand sipping water. The Judge is not on the bench.

9:50

His best recollection is she told him kwame said, "mom I love you but I handle the city business and you handle the government business." Thomas is objecting to this as hearsay. Sidebar.

9:47

Hardiman says he talked to Rachmale and they decided to work Bobby into the deal for 10-12% but bobby just told them, "we'll see."

Hardiman says they never got the go ahead to start work and that the normal process in the water department wasn't working, started making enquiries, called Daryl Latimore the Assistant Director and was told the contract was sitting on Mercado's desk. Didn't get answer from Mercado and then called Mayor but didn't hear back from him either. Says that surprised him because he was on the transition team.

Says he then contacted the Mayor's Mom.

9:44

Explaining how each team member puts together their part of the bid, gives it to the bidding company and that company puts it all together and submits it to the city. Says Bobby didn't participate in this but still wanted 25% of the contract.

Says bobby told him it still has to go across the Mayor's desk. Says that didn't mean anything to him because he also knew the Mayor.

SAys the contract went through all the reviews.

9:40

Says he submitted a bid in 2002 for sewer contract for $10 million with Water Department, submitted another for $5 million. Got one contract and one contract was pulled. Says the pulled contract, got a letter saying they were awarded the contract. This is the $10 million contract. Says he had an encounter with Ferguson, came by his house, said he wanted to be part of the contract. Hardiman says they had their team together but Bobby says it still had to go through the Mayor's office.

9:36

Hardiman says he participated on Kwame's transition committee when he was elected Mayor, demo and cleanup committee, and Bobby Ferguson was the chairman.

Says the scale of Lakeshore in 2002 was around $14,000,000 in sales, much smaller than it is today.

9:34

Hardiman says he met Carolyn Cheeks-Kilpatrick in the late "80's. Says he met Kwame when he was still in college. Says he supported both in their various political campaigns. Says Rachmale also contributed.

9:32

Says one company is Lakeshore Health Care, a nursing home. Says it was in the neighborhood where he grew up and was going out of business. Now talking about the real estate comp nay, Sky Group Brand, that is affiliated with Lakeshore. Also has a non-profit arm, that provides assistance for Seniors, Youth initiatives, and returning citizens...people coming out of prison. Puts them to work on construction jobs and in real estate arm doing cleanup and maintenance work.

9:29

Hardiman says he started A&H in 2003. Mark Chutkow asking how many employees in Lakeshore related companies. Hardiman is listing several company names now... and the Judge is asking him to speak up again.

9:27

Hardiman says the company was registered with the small business administration as a disadvantaged company and got an award, at the White House, for being an outstanding business.

9:25

Hardiman says he showed Rachmale his bills each month. At the end of 2 years Rachmale gave him a bonus that was enough to pay off his bills. Says Rachmale told him "a man who is not in debt can think better."

9:24

The Judge is asking Hardiman to speak up again. He says Rachmale hired him as a consultant and then put him on the payroll full time in 1999. Says his financial situation was a little challenging so Rachmale set him down and schooled him in finance, said if Hardiman would listen to him Rachmale would help him become debt free. Disciplined him on spending.

9:21

Hardiman is telling the court that he was a Detroit fire fighter in the 1970's, and started in 1994 working with the Detroit Minority Business development Center. Helped firms get certified as minority businesses. Says that's where he met Abinash Rachmale the CEO of Lakeshore Engineering. Rachmale wanted help getting his environmental engineer firm certified.

9:16

And Pazcewicz is stepping down. A little paper shuffling and no questions. Thomas Hardiman is not taking the stand. This is the guy I said was expected to take the stand next.... 3 days ago.

He runs A&H Contracting, he's the President, he also partners with Lakeshore Engineering. Hardiman is a middle aged black man, balding, with dark rimmed glasses. He's soft spoken and seems a little reticent. The Judge has asked him to move closer to the microphone.

9:12

Crandall is done and Mike Rataj is taking his place. Mighty Mike with the mini-mullet as M.L. put it in his Takeaway last night. Rataj has no questions but is putting documents into evidence. These are government exhibits about contracts that haven't been put into evidence.

9:09

Slight technical problem with the audio this morning. There is none. Crandall is handing the special agent a document. Looks like we'll have the Mime version trial here for a few minutes. There we go, the sound is back.

9:07

Martin Crandall, one of Victor Mercado's attorneys is setting up at the podium to do more questioning.

9:04

Special Agent Carol Pazcewicz is waiting to take the stand. Defense attorney grilled her yesterday in what was the most contentious questioning of the trial so far. Pazcewicz investigated the downtown water main contracts that have been front and center the last few days.

9:03

Court is in session and the Jury is filing in.

9:01

Good morning from the Theodore Levin Federal Court House in blustery and chilly downtown Detroit.

-Ken Martinek is Senior Producer -Investigations for Fox 2 News

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