Day 29: Contract pulled at last minute helped Kilpatrick's pal Bobby Ferguson, feds allege

DETROIT (WXYZ) - Earlier today, 7 Action News Investigator Ross Jones blogged all the developments to come from day 29 of the Kwame Kilpatrick corruption trial.  Follow along below:

12:59--Done for the day: We'll resume tomorrow at 9AM with Mr. Latimer still on the stand.

12:52--Buckeye based: Thomas says that the reason DLZ's Detroit based business certification was pulled was because it was, in fact, based in Columbus, Ohio.  Not Detroit.

12:47--Cost worth it: Thomas is arguing that even though it may sometimes cost more, there is an incentive to hire Detroit-based businesses because it encourages people to work or live in the city. He's suggesting that Ferguson was recommended for work on jobs where he was sometimes the higher bid because they were a Detroit headquartered business. 

12:40--Prosecution sits: Kilpatrick lawyer Jim Thomas is first up to cross-examine.

12:37--Higher, but picked: For another city job related to this previous contract, Ferguson's company was selected as the best bidder, even though the next highest-scoring bidder came in at $2 million less than Ferguson's.

12:32--Unusual contract: "Have you ever observed this sort of activity involving headquarter status for companies bidding for business?" Chutkow asked.

Latimer responded he had not.

12:15--DLZ certification: Right now, Latimer is testifying about how another construction company, DLZ, had its certification as a Detroit headquartered business be pulled without an apparent explanation.  DLZ was a competitor of Ferguson Enterprises, and after their certification was pulled, that moved Ferguson up from the #2 bidder to the #1 bidder. 

Sorry for the delay in blog posts.  Had to run outside to update our 7 Action News at Noon viewers.

11:55--Short break: Stay with us.

11:50--Meeting with Kilpatrick: Latimer says he and his boss Victor Mercado were called to a meeting with Mayor Kilpatrick not long after this, and that neither knew what the meeting was about.  Latimer says Kilpatrick wanted to talk about concerns that economic development factors was being weighted too heavily in awarding contracts to businesses. 

11:40--Unusual scoring: Latimer says it was unusual to use a particular type of scoring method for city contracts for a job that ultimately went to Ferguson.  He says the scoring method has not been used in the same fashion before or since, but it helped raise Ferguson's scoring.

11:21--Feeling uncomfortable: "Did you feel comfortable writing these words?" asked Chutkow.

"No," Latimer responded.

"Why," Chutkow asked.

"Because they were not my words," he responded.

11:17--Victor told me to: Now being shown on the screen is an e-mail from Latimer to his then boss, Water Chief Victor Mercado.  The e-mail from Latimer, he says that contract #1361 should be canceled and combined with another contract to save money.

"Why did you write Mr. Mercado this e-mail," Chutkow asked.

"Because he asked me to write this e-mail," Latimer said.

Latimer said he was told what to write by Mercado and, in fact, he disagreed with him that combining the contracts was the right way to go and would save money.

11:11--Large contract: So far, Latimer has just testified about the size of the contract and the amount of time it took to get approval from the City, Board of Water Commissioners and others. 

10:53--Contract 1361: Latimer is testifying about a contract (#1361) that was awarded to Lakeshore in 2003, after it scored the highest when bids were tabulated, which was later yanked from Lakeshore. The contract was for as-needed sewer repair work, meaning the company would be used to repair sewers that had not yet broken. 

10:46--Next witness: The government has called Darryl Latimer as its next witness.  He's an employee of the City of Detroit Water and Sewerage Department as its deputy director (third in charge).  He's worked for the department since 1989.

While Kilpatrick was Mayor, Latimer said he oversaw consultant contracts in the department.

10:23--Short break: When court resumes in a few minutes, we'll have a new witness.  Stay tuned...

10:20--Evelyn's shot: Ferguson's lead attorney had a parting-shot for Rachmale before finishing his questioning, talking about the "hardship" that Rachmale says he experienced as a result of the alleged extortion.

"Through this hardship you've experienced, your company exploded in growth, right?"

He sat down before Rachmale could answer.  Rachmale is done testifying.

10:06--Closing question: Chutkow's last question to Rachmale before sitting down:

Other than to Ferguson, "Have you ever had to pay a contractor because you were afraid your contracts would be canceled?" Chutkow asked.

"No," Rachmale asked.

9:58--Revenue v. profit: Rachmale is explaining that his company received only a small amount of the more than $150 million it received in City of Detroit Building contracts: 8 cents of every dollar.  The rest, he says, went to pay subcontractors. 

That 8 cents of every dollar represents $12 or $13 million of the almost $158,000,000 in contracts.

Still a lot of money, but the government wants to make the distinction that the $158m wasn't profit.

9:40--Small potatoes: How much of Lakeshore's business was made up of building department contracts?  About .02%, says Rachmale.  The government wants jurors to believe that there was little upside to having a friend in the Detroit building department, as Lakeshore didn't put many eggs in that basket.

9:38--Other employees: Chutkow is showing the jury that same Lakeshore employee directory that the defense brought up earlier, but pointing out employees who didn't work for Lakeshore, but were listed on the directory. They include employees from IBM, the Environmental Protection Agency and other organizations.

The government's point: just because you were on their directory doesn't mean you were an employee, just a contact.

9:32--Damage control: The defense is done for now and Assistant U.S. Attorney Mark Chutkow is up now with more questions for Rachmale.  He's got his work cut out for him, as the defense has landed some blows to Rachmale's credibility over his employment of the City of Detroit Building Department employee.

9:25--Support for Kilpatrick: Kilpatrick's attorney James Thomas is up now, and he's asking Rachmale about a letter he sent to a Wayne County judge in 2008, right before Kwame Kilpatrick was about to be sentenced for the text message scandal. In the letter, Rachmale asked for leniency and spoke well of Kilpatrick. 

The defense's point: why would you say such nice things about a guy you think so poorly of?

9:12--Familiar tune: Again, Evelyn is harping on a point he made yesterday in court: that Rachmale was employing a City of Detroit building inspector (Dilip Patel) at the same time he sought contracts from the building department.  Rachmale is being somewhat coy, saying he didn't know the employee was working in his building, but Evelyn is showing a Lakeshore directory which includes Patel's name, phone number and e-mail address.

9:04--Not done yet: Yesterday, Bobby Ferguson's defense attorney Gerald Evelyn said he was finished cross-examining Avinash Rachmale--the Lakeshore Engineering President who says Ferguson extorted him--but it appears he's had a change of heart.  He just told Judge Nancy Edmunds he has a few more questions for Rachmale. 

9:00--Welcome back: It's day 29 here at the Kilpatrick corruption trial.  We're hearing the prosecution will rest its case sometime in January, which means we've got about a month left of testimony until the defense gets its turn. 

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