CINCINNATI — A federal prosecutor said former Ohio House Speaker Larry Householder “sold the statehouse" and "ripped off" the people he was elected to serve in a backroom deal to trade power for money.
Assistant U.S. Attorney Emily Glatfelter — the same lead prosecutor in the public corruption case against convicted former Cincinnati City Councilman P.G. Sittenfeld — is now taking on Householder in the largest public corruption trial in Ohio history.
Householder and former GOP chair Matt Borges are facing a jury trial together, both accused of being a part of a criminal enterprise. Racketeering conspiracy, or RICO, is a charge more often associated with organized crime bosses than elected leaders and lobbyists.
Both have maintained their innocence. They face as much as 20 years in prison if convicted.
“If this looks complicated it is. Purposely so. This is a way to hide money and make it … difficult to trace,” Glatfelter said, as she outlined a complex alleged scheme to disguise bribe money.
A grand jury indicted Householder and four associates in 2020. They allegedly took $60 million from Akron-based FirstEnergy Corp. and funneled the dark money through a nonprofit, Generation Now, to build a power base for Householder and pass a $1.3 billion bailout for two nuclear plants in what is known as Ohio House Bill 6.
The people who took part in this criminal enterprise called themselves, “Team Householder,” “House Bill 6 Team,” and “People on the Farm,” said Glatfelter, who noted that Householder wanted to find “casket carriers,” or people who were loyal to him above all else — even their own constituents as elected leaders.
Two defendants have pleaded guilty to conspiracy and agreed to testify at trial: lobbyist Juan Cespedes and political advisor Jeffrey Longstreth. A third, Columbus lobbyist Neil Clark, took his own life a year after his arrest. Clark died from a gunshot wound to the head in March 2021, while wearing a blue “DeWine for Governor” T-shirt, according to his Florida autopsy report which was reported by numerous media outlets.
FirstEnergy representatives signed a deferred prosecution agreement with prosecutors in July 2021 and agreed to pay a $230 million fine. The public utility holding company admitted it conspired with public officials and others to pay millions in exchange for financially beneficial legislation.
U.S. District Court Judge Timothy Black also granted immunity to two unidentified witnesses, at the government’s request, who will testify at trial, according to court filings.
“In some sense, the entire statehouse is on trial,” said University of Cincinnati political science professor David Niven. “It’s hard to see a scenario in which you don’t view this case as defining the way Ohio politics works.”
But Glatfelter said this case isn’t about whether the nuclear bailout was worthwhile legislation, or whether the defendants are good guys or bad guys.
“When you create a corrupt political machine that’s … racketeering,” Glatfelter said.
During Glatfelter’s hourlong opening statement, Black admonished Householder’s attorneys for talking, pen tapping and making facial expressions while she spoke.
Then on a jury break, Black followed up with a more scathing rebuke, saying he was “appalled” by Householders’ attorneys’ behavior, calling them “bush league,” and threatening to make them sit in the gallery with spectators.
Afterward, when Householder’s and Borges’ attorneys gave opening statements, Black frequently reminded them to stick to the evidence and stay within the agreed-upon timeframe.
Both lawyers said their clients did nothing wrong.
“You’re going to see that the government got it wrong here,” said Householder attorney Steve Bradley. “None of these political contributions were made in exchange for an explicit promise or agreement by Larry that he would take some form of official action in the House that was beneficial to First Energy.”
Instead, Bradley described the money that flowed into Generation Now as “ordinary political contributions,” and the motivation for Householder’s support of the nuclear bailout was because it benefitted “all Ohioans.”
Bradley said Householder wanted to preserve thousands of nuclear plant jobs and believed some energy mandates were inefficient.
Prosecutors say Householder used $500,000 in alleged bribes to settle a personal lawsuit involving a coal plant, pay legal bills and credit card debt, and repair hurricane damage to his Florida home. Householder’s lawyers say this money wasn't a bribe, but actually a loan from Jeff Longstreth, who was one of his closest advisors.
“So yes, Jeff Longstreth paid money to a law firm, paid money to a general contractor in Florida, paid money associated with this (Householder lawsuit) settlement of this coal mine that had gone bad. But all with the expectation that it was a loan to be repaid and not that it was Larry’s cut of a bribery scheme,” Bradley said.
Prosecutors say the contractor who worked on Householder’s house will testify.
Others who will testify include: an Ohio State University professor on energy policy; an IRS expert on dark money and nonprofits; employees of the Generation Now nonprofit at the heart of the case, and FBI agents.
They will also hear from the late Neil Clark through his wiretapped recorded conversations.
Glatfelter said law enforcement had been investigating Clark related to another scheme. Then, in late 2018 and early 2019, they intercepted a few calls between Clark and Householder, which eventually led to this criminal case.
Political operative Tyler Fehrman is expected to testify that Borges attempted to bribe him, attorneys said during opening statements.
Fehrman was working for a referendum campaign that sought to repeal the nuclear bailout when Borges allegedly tried to bribe him to get inside information on the campaign.
But Borge’s attorney Todd Long said his client was just trying to help Fehrman pay for a child custody lawyer by giving him extra project work worth $15,000.
“There is a universal difference between Matt Borges and everyone else you’re going to hear about in this case,” Long said. “Matt Borges ’purpose was never Larry Householder’s political career. He was never on Team Householder ... They had political rivalries going back years, they weren’t friends and in fact they didn’t even like each other."
Long said there’s no evidence Borges joined a conspiracy or even knew one existed.
Testimony will continue tomorrow in a trial that is expected to last four to six weeks.
