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Monday, March 18, 2013

Will Race Determine How Mike Hubbard Is Treated Over Apparent Violations of Alabama Bid Law?

Mike Hubbard
A violation of the Alabama Competitive Bid Law can be a crime--and recent history indicates it is treated that way when the alleged violators are from a predominantly black, Democratic county.

But what happens when an apparent violator is a white Republican, with powerful ties to former Governor Bob Riley and his political machine? More specifically, what happens when the apparent violator is Alabama House Speaker Mike Hubbard (R-Auburn)?

We might soon find out, in the wake of a report last week that Hubbard rigged the bid-law process to obtain a multimillion-dollar media contract with Auburn University. Buddy Mitchell, a former lobbyist for Auburn, says in a sworn statement that Hubbard received copies of competitors' proposals before winning a five-year multimedia contract for Auburn athletics in 2002. In fact, Mitchell states in an affidavit that he personally delivered competitors' proposals to Hubbard, and that allowed Hubbard to tailor his bid in order to win the contract. It's all in a report by Bill Britt of Alabama Political Reporter.

Mitchell was director of governmental affairs at Auburn from 1993 to 2004, and Hubbard worked in the university's sports-information department before joining Host Communications in 1990. Hubbard proceeded to wrestle the contract away from Host via a no-bid contract and formed the Auburn Network in 1994. By the early 2000s, Hubbard's company reportedly was struggling financially when he approached Mitchell for help after Auburn forced him to go through a competitive-bid process. Here is how Britt describes what happened next:

Mitchell said Hubbard first acknowledged to him that his company was on the verge of going bankrupt.

Initially, forced by Auburn to go through a competitive bid process for the first time, according to Mitchell’s statements, Hubbard was given access to all of his competitors'  proprietary proposals prior to making his winning offer for the contract.

For years, it was speculated that Hubbard was given an unfair advantage in obtaining the Auburn contract. Mitchell, who was executive director of the Office of Governmental Affairs at Auburn from 1993 to 2004, said in a sworn affidavit that he personally delivered the competitors’ proposals to Hubbard.

If Mitchell's allegations are proven to be true, it's hard to imagine a more grotesque violation of the Alabama Competitive Bid Law. Attorney General Luther Strange--like Hubbard, a devout member of Team Riley--has proven that he treats the bid law seriously. In May 2011, all five members of the Bullock County Commission were arrested on felony charges of bid-law violations.

We reported on the Bullock County story and noted the political and socioeconomic climate surrounding the case:

The inquiry into Bullock County's finances started under the Riley administration, with Strange following through now on arrests. Is this payback for some slight that Riley perceived coming from Bullock County during his administration? Could this be part of a larger GOP plan to continue terrorizing Democrats in the Deep South?

To arrive at possible answers to those questions, it helps to understand the demographics of Bullock County. The county is 74.9 percent black, with a median household income of $24,440, well below the state average of $40,489. In the 2008 presidential election, Bullock County gave 74.2 percent of its vote to Barack Obama, with 25.7 percent to John McCain.

Bullock belongs to a strip of counties that starts to the northwest of Montgomery and runs to the capital city's southeast, representing what passes for a Democratic stronghold in Alabama.

Was the public trust grossly violated in the Bullock County case? Well, the five commissioners, combined, were alleged to have paid $85,000 for food and supplies without following the state bid law. That means each commissioner was responsible for roughly $17,000 worth of bid-law violations, although it's unclear that any of the commissioners personally benefited. Even Luther Strange must have realized the case was weak because he announced in February 2012 that he was dropping all charges.

Let's compare that to the case of Mike Hubbard. Here is how Bill Britt describes it:

In accepting Hubbard’s five-year, $8.5 million deal in 2002, Auburn, in turn, rejected a competitor’s bid that offered $12.5 million over the same period. That meant Auburn received $4 million less under Hubbard’s proposal than under the bid more financially beneficial to Auburn.

Translation: Hubbard "won" an $8.5-million contract that he probably would not have received without being able to tailor his proposal, based on under-the-table information about competitors' bids. On top of that, a taxpayer-funded university wound up paying $4 million more than it should have paid. If our math is correct, that's about $12.5-million worth of graft and corruption, courtesy of a public official who went on to chair the Alabama Republican Party and then become speaker of the House.

Is Mike Hubbard likely to face criminal charges of the sort that were brought against Bullock County officials? We think it's doubtful, based on a number of political and legal considerations. For one, it's hard to imagine our Republican-dominated power structure treating one of Bob Riley's favored sons the way it treated the commissioners in Bullock County. Perhaps of more importance, the applicable statute of limitations on a 2002 transaction probably has expired, which would block a criminal case as untimely.

It's possible that Hubbard is not out of the criminal woods. The five-year deal with Auburn extended through 2007, so that might bring the applicable statute of limitations back into play. Could a crafty prosecutor make the case that Hubbard has engaged in ongoing criminal activity that grew out of the 2002 deal, extending the statute of limitations? Well, Hubbard sold the Auburn Network to International Sports Properties (ISP) in 2003, but he continued as president of ISP's Auburn sports project. IMG College purchased ISP in 2010, so the Auburn Sports Network now operates under the IMG College banner. The Auburn Sports Network still has its contract with the university, so one could argue that the firm continues to benefit from Hubbard's apparent fraud on the 2002 deal.

If Hubbard used the the U.S. mails or wires while rigging the bid process--and he almost certainly did--that might invoke federal jurisdiction. And Hubbard's actions appear to go well beyond bid-law violations to outright fraud.

All of this includes an ironic twist in the volatile world of sports media. Host Communications, which probably would have won the bid in 2002 without Hubbard's apparent fraud, also has been bought by IMG. Host Communications probably is just now finding out about the fraud-riddled bid process in 2002, so it likely would have a valid civil claim against Hubbard. But with Host and the Auburn Network now both under the IMG banner, would such a claim make sense? Could IMG/Host go after Hubbard individually in a lawsuit?

The answers to those questions are unclear, but we suspect Hubbard's biggest concern should be on the civil side, rather than criminal. Auburn University might have the strongest grounds for a lawsuit, and who knows what the wide-ranging discovery process in such a civil claim would reveal about Mike Hubbard's business and political practices?

Paul Davis, the late owner and president of The Tuskegee News, wrote an article in 2010 that outlined Hubbard's machinations on the Auburn contract from 2002. The Davis article references an "emissary" who delivered copies of competitors' proposals to Hubbard. Thanks to Bill Britt's reporting, we now know the emissary was Buddy Mitchell--and Mitchell has admitted to his role in a sworn statement.

Regardless of what happens to Hubbard in a court of law, Alabamians should consider the words in Buddy Mitchell's affidavit and ask this question: What kind of man is leading our House of Representatives--and what kind of tactics did he use to reach that position?


Anonymous said...

What's good for the commissioners in Bullock County should be good for Mike Hubbard.

MyLittleDemon said...

Wouldn't a student who got caught with this kind of cheating be expelled from Auburn?

Anonymous said...

If Mike Hubbard skates on this, someone needs to alert Jesse Jackson's organization about the Hubbard case vs. the Bullock County case. Ridiculous.

Anonymous said...

"Those who are in contact with the Speaker on a regular basis say he is coming unhinged. Temper tantrums, spells of depression and erratic behavior have all been reported."


I've been hearing about this more and more. Hubbard's paranoia is eating away at him and he doesn't handle stress well.

Payback is a bitch, Mikey. You've destroyed businesses, families, jobs, reputations and the public trust. And now the feds have gotten wind of it. I'm going to enjoy watching you go down in flames.

legalschnauzer said...


I think you raise a valid point. This is very much like a student getting the answers in advance to a test and using them to get an "A" on the exam. College students routinely are expelled for such episodes.

Anonymous said...

I would like to see those folks in Bullock County sue the pants off of somebody for that debacle. I didn't realize those charges had been dropped. Thanks for the update.

Anonymous said...

Does Hubbard have a severe case of "Short Man's Syndrome"?

Anonymous said...

Like @9:21, I'm hearing the feds are quite interested in Mr. Speaker's actions. If Mr. Speaker doesn't handle stress well, he'd better start figuring out how to do it. I hear a lot of stress is heading his way.

Bart said...

I thought Mike Hubbard was a "free market Republican." Sounds like he only likes the free market when it's rigged in his favor.

Anonymous said...

Sounds like David Housel was the athletics director who decided to hold Hubbard's feet to the fire. David is a genuine Auburn man who probably didn't appreciate the fact that Hubbard is an opportunist and a POS.

Anonymous said...

Talk about a wheeler dealer. This is from the Paul Davis article about Hubbard. If Hubbard wasn't able to suck up appropriately to Bobby Lowder, it sounds like he sucked up to Pat Dye . . .

"Bobby Lowder's Colonial Bank also played a key role in keeping Craftmaster afloat during some of its most troubling times between December 1, 2004, and the December 31, 2004, Craftmaster had more than $800,000 in a Colonial Bank account, using it to meet payroll and other expenses.

"In October 2004, Hubbard formed Swann investments LLC, a corporation which included former AU Coach Pat Dye, Opelika Mayor Gary Fuller and Ike Scott of Opelika, a major highway and bridge contractor.

"Later that year Hubbard and his partners began transferring major assets from Craftmaster Printers to Swann Investments LLC, Craftmaster buildings and all printing equipment. Then they leased back to Craftmaster its building and equipment."

Anonymous said...

Hubbard is a parasite. Been sucking off Auburn's butt for years.

Anonymous said...

If this is Hubbard's version of "ethics" in the business world, what should we expect from him in the political world? More of the same?

Coyote Lane said...

Circa 1963. JFK said it out loud and we know where the truth got his family and him. NO JFK Jr. to be a President for U.S.A.

FREE PRESS was to be for all Americans and of course we also got to 'coin' our own "digital dust."

Jack Ruby tried to warn us, he said a "government" was to control US and not at all what we were-are prepared to "understand."

TECHNOLOGY was decided to be owned by the Technofascists, [Federal Reserve System (Fed)] that are THE owners of Technoliberal, New World Order, moron Automaton slaves to digital debt.

Mike Hubbard is an addict to the genetically modified organisms that have shrunk all his internal organs, brain most certainly.

He is a Technocrat reactionary ultra faux conservative.

It is just a matter of time.

The NWO Liberal NAZI Automaton Technocrats for the Technofascists are snap, crackle and popping, too, all the engineered throw-away "Americans" are exposed.

Where is the popcorn to pass around, folks, the show is only just beginning.

Hollywood has lots of "pictures" to make us think that the House of Representatives in every nook and cranny USA is "OK."

Anonymous said...

Doesn't sound like Mike Hubbard is a particularly good businessman.

Anonymous said...

I want to know what Jessica Medeiros Garrison, Luther Strange's Head Aide, thinks about this. Has she debriefed Luther on this issue yet? Has she found any hard evidence that will stand up in court?

HLM said...

And we're suppose to believe Hubbard when he says he had no idea certain funds came from gambling interests?

legalschnauzer said...

LOL, @1:31. I would say Hubbard has the same "business touch" that George W. Bush had.

Anonymous said...

Hubbard has even gone so far as to have legislation passed to protect his contract. I can't remember the senator that introduced the legislation, but the bill ended up in conference committee. Hubbard was on the conference committee and the bill passed.

I'll look it up and provide links.

Anonymous said...

"Hubbard made sure that would happen. He helped steer through the Alabama Legislature in 2000 a bill that exempted the athletics, food services and transportation departments from Alabama’s competitive bid laws. Another line in that new law allowed schools to extend their no-bids-required contract for 10 years. Hubbard did not sponsor this bill (It was introduced by George Clay of Macon County) and Hubbard actually abstained on the first vote. (He also made sure to have the House clerk insert in the official journal that he had abstained to avoid the appearance of a conflict of interest.)"

"When the controversial bill was amended, it was returned to a conference committee. Hubbard was named to that committee where the final version, shaped in his favor, was approved. Hubbard voted for the bill in conference and on final passage as it became law. He didn’t seem to be worried about a conflict of interest this time around."


Anonymous said...

One reason Hubbard and Riley get away with stuff like this is they know middle-class whites will not join with blacks to fight corporate/political elites. The stupidty of middle-class whites and the timidity of postmodern blacks (yes, you, Barack Obama and Eric Holder) have allowed the rise of the GOP thug class. It's the same problem that has kept unions weak in the South and allowed corporations to dump all over workers.

legalschnauzer said...

Anon at 2:42--

Thanks for a profound comment. Racial fears have caused the white middle class to slit its own throat.

Anonymous said...

GOP Thug Class, 2:42 Anon, great visual of what has gotten to be the top tier of criminals in the south and of course then, U.S.A., DC especially as you noted, too.

Obama and Holder are the icon proof that criminals have no racist lines, the splits as you say are in the masses of "voters."

I don't know exactly when the south got fully disappeared into the technology snare of electric shock therapy. The country has been carefully hypnotized to the concept impotency, since the murder of JFK. Truly this is the tap root rot of how America became nothing but a commodity to be traded and exchanged in the global marketplace as nothing but a Wall Street gambling bet.

What a house of damned, dying underneath mort-gage frauds, when the reality living, doesn't.

Choice is a hard truth for the modern American.

Anonymous said...

Where is Buddy Mitchell now and what is he doing?

legalschnauzer said...

Good question about Buddy Mitchell, and I don't know the answer. Little help, readers?

Tanya Mitchell said...

Concerning Buddy Mitchell, he stuck to the story because he wanted the truth to come out and to show his Grandchildren about honesty. He loved Auburn University and the State of Alabama more than anyone I know. He taught me the Auburn fight song when I was a little girl and took me to many campaign outings long before he became personally involved in the Alabama Political circle. He was a brilliant, hard working man who earned his place working for the great State of Alabama. It gave him great pride and he always spoke with passion concerning the History of Alabama and Auburn University.
He was my brother.
He passed away this past week, December 3, 2014 of a Heart Attack. He is survived by his 2 living children and his 3 grandchildren as well as his 2 brothers and his sister. He will be missed very much. His passing has left our hearts saddened but so very blessed to have shared his life. A life that he lived with joy, curiosity for knowledge, a quick sense of humor and a Deep Deep love for his Country, His State and His Auburn !!!! War Eagle Buddy