Federal Trial Begins For Supermarket Execs White, Small

The bribery and extortion trial of Maryland State Senator Ulysses Currie and co-defendants William White and Kevin Small, both formerly with Shoppers Food & Pharmacy, began September 27 and is into the second week of a trial that is expected to last at least until the end of October.

Currie, a Prince George’s County democrat who had served as chairman of the Senate budget and taxation committee, has been charged with accepting more than $245,000 in payments in exchange for using his influence in the state senate to shape legislation in Shoppers’ favor. Also charged were retired Shoppers CEO William White and former VP-real estate R. Kevin Small, now an executive with Weis Markets.

Shoppers hired Currie as a consultant for community relations and minority recruitment in 2003 and paid him until 2008. The indictment alleges that both Currie and Shoppers knew that the payments were made for Currie to take official actions in the legislature to benefit Shoppers.

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Although Shoppers hired Currie as a paid consultant, the senator failed to file an ethics disclosure form claiming the income, which prompted Federal officials to began an investigation into the relationship between Currie and Shoppers as well as its parent company Supervalu.

The years-long investigation originally focused on about a half dozen Shoppers executives and in 2008, the FBI raided Currie’s home in District Heights and Shoppers’ headquarters in Lanham, seizing bank statements, tax records, and correspondence between the senator and Shoppers.

In September 2010 an indictment was filed in U.S. District Court in Baltimore against Currie, White, Small and Supervalu. The original indictment included charges of bribery, conspiracy, extortion, mail fraud and false statements.

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Over six years, the indictment alleged, Currie took action to help Shoppers sell liquor at one store, save money in the construction of another store and buy land.

Prosecutors listed a number of ways they believe Currie helped the company over a five-year period, including securing favorable rent rates for the Shoppers in Baltimore’s Mondawmin Mall and pushing for roughly $2 million in road improvements that benefited the grocery chain.

They also pointed to Currie’s legislative record in the Senate, which included support for liquor legislation favorable to the chain and proposed delays of new energy standards, according to the charges.

Throughout the investigation Supervalu (then headed by CEO Jeff Noddle) defended its stance that it had hired Currie as a paid consultant and supported the Shoppers executives who were under investigation, paying their legal fees. Documentation was fully disclosed by Supervalu showing their agreement with Currie, and Currie paid federal taxes on the income from Supervalu. But, once the indictment was filed, Supervalu, by then under a new regime led by CEO Craig Herkert, opted to enter into a deferred prosecution agreement and to pay a $2.5 million fine, severing ties with White and Small.

By the time the case went to trial last month, several of the charges had been dropped as it seemed the government would focus on bribery and extortion. Currie is charged with nine counts, involving conspiracy, bribery, extortion and making false statements to FBI investigators who questioned him in 2008. White and Small are each charged with five related conspiracy and bribery crimes. The defendants could face prison terms and/or fines if convicted. All three confirm their innocence and deny the charges.

The trial began with opening statements by the prosecution and defense September 27. Witnesses called by the prosecution so far include Neil Pederson, head of the State Highway Administration, who said Currie never disclosed he was being paid by a grocery store chain as he pressed for installation of traffic lights near the company’s stores.

Pedersen testified about Currie’s persistence in getting traffic lights installed at two grocery stores in 2004 and 2005, one in Baltimore County and another in Anne Arundel County.

“Senator Currie asks me every time he sees me whether we have resolved the Reisterstown Road Shoppers Food Warehouse issue,” Pedersen wrote to a colleague about the Baltimore County location. “How close are we to resolving it?”

Pedersen also was asked by federal prosecutors about an email he sent, expressing his anxiety about tending to the senator, who was chairman of the powerful Senate Budget and Taxation Committee, which steers state spending.

“It is very critical that we do all that we can to expedite this as much as possible,” Pedersen wrote, after explaining that the agency’s budget was before Currie’s committee, as well as “several critical pieces of legislation.”

Emails exchanged between Pedersen and SHA staff illustrate Currie’s persistence in getting the projects done. The light was never approved, but a change was made at the intersection to allow left turns.

Also testifying for the prosecution was former Maryland transportation secretary Robert Flanagan, who told the jury that Currie did not disclose his financial relationship with Shoppers when dealing with Flanagan in attempts to help Shoppers move into space occupied by the Motor Vehicle Administration at Mondawmin Mall.

Then, the prosecution called former Supervalu VP-real estate development Fred Clowes to testify regarding Shoppers’ interest in the Mondawmin Mall site. He testified that he became curious about Currie’s role with the company following a meeting the senator had arranged with Flanagan and Department of Economic Business Development secretary Aris Melissaratos. They discussed a transportation issue regarding Shoppers’ moving to the MVA location because Shoppers needed state and local financing in order for the project to move forward. Clowes said that he thought Currie was acting as more than a politician helping constituents and the situation made him “uncomfortable.”

Currie’s defense pointed out that Clowes, despite any concerns he might have had, continued to work with Currie on projects for another 11 months. The defense also questioned Clowes’ motivation, suggesting that he had left earlier employment at Shoppers under “difficult” circumstances.

Melissaratos took the stand next and also said he did not know that Currie was a paid consultant for Shoppers at the time of the meeting. The defense asked Melissaratos if knowing of Currie’s relationship with Shoppers would have made a difference in his decision to recommend a $1.8 million state grant for the redevelopment of Mondawmin Mall and he answered “no.”

At presstime, the trial in Baltimore was continuing with testimony from a Supervalu lawyer. In questioning by the defense, the attorney said that no red flags were raised after she learned Currie was a state senator and if there was concern about whether a state senator could participate in a consulting agreement.

The defense also emphasized the broad terms outlined in the agreement between Currie and Shoppers, Collins said. They pointed out there was no “limiting language” in the contract regarding Currie’s role as an adviser.

In the next few weeks, it is expected that the defense counsels for Currie, White and Small will demonstrate t hat there was no crime committed by any of the individuals and that all three men have had stellar, long-term records of serving their constituency and their companies. The trial could last into early November.