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Some unanswered questions about alleged payments to Norm Coleman's wife

Since yesterday's post about the Kazeminy-Deep Marine-lawsuit-Coleman question, there have been a few developments, but none that answer any of the critical questions. In this update, we'll review the developments but focus on identifying the questions that can't be answered yet.

For good and valid reasons, news organizations are traditionally leery of late-breaking and impossible-to-confirm scandals on the eve of an election. Former U.S. senator (and experienced retailer) Rudy Boschwitz used to remark that being in politics was like being in a business where you had to make all your sales on one day (that day being Election Day). Boschwitz didn't say this, but to build on his observation, suppose that just before the big day, a rumor circulated that your merchandise was tainted. You would soon be out of business. And if the rumor was false, a great injustice would have been done. With that in mind:

Development 1: Paul McKim's lawsuit (alleging that Nasser Kazeminy used the Texas underwater  oil and gas services firm Deep Marine Technologies to funnel an improper gift of $75,000 to Sen. Norm Coleman and his wife, Laurie) has been reinstated.

This is a blow to the Coleman campaign, which had been arguing that since the suit had been withdrawn, it was a non-issue. Coleman himself had said that the withdrawal indicated that the facts in the suit were invalid. On the contrary, McKim's attorney Casey Wallace is explicitly stating to every inquiring reporter (including me) that McKim stands behind his version of the facts alleged in the complaint.

But the reinstatement doesn't prove a thing either. There is nothing very impressive, other than  McKim's statements in the lawsuit, to suggest that the Colemans have benefitted from a shady deal. In fact, Wallace has explicitly stated to me that McKim makes no claim that the Colemans got the money, only that Kazeminy intended for them to get it. And Coleman's campaign manager, Cullen Sheehan, has stated flatly that the Coleman's never got a dime.

Development 2:
Wallace also gave at least a reasonable-sounding explanation for why the suit was withdrawn. It's a business suit over money. After it was filed, the parties entered into settlement negotiations. As a show of good faith during the negotiations, the plaintiffs pulled the suit down, noting that they did so without prejudice (meaning they reserved the right to refile it if the case wasn't settled). When the negotiations broke down, they reinstated it.

This is a further blow (but not proof of anything) to the Coleman claim that the withdrawal of the suit meant there was nothing to it.

Wallace is also asserting quite forcefully that the suit was not motivated by politics. Coleman says it was. Of course both sides would say what they are saying. We don't have any basis to know who is right. Coleman's best evidence is simply timing: Why is this coming out in the final days of the election campaign?

Wallace does have an answer on the timing question. He says McKim and Deep Marine are facing demands for answers from other shareholders about whether the company is being run properly. He also says that Kazeminy (I haven't mentioned that he is the controlling shareholder of DMT) had told McKim, the founder and long-time CEO of the company, to remove himself from the operation of the company for 90 days, and the 90 days was about to expire. If true, those are non-political explanations for why the suit is surfacing this week. The biggest demand that McKim is making in the case so far is to have a receiver appointed to run the company while these issues are litigated and sorted out.

It's altogether possible to believe that the Wallace/McKim side is using the timing of the election to gain leverage in the belief that Kazeminy will give them what they want in order to keep them quiet until Kazeminy's friend Coleman is past the election. (But if that's true, it seems they would have gained more leverage by merely threatening to file it publicly.)

It's also entirely possible that some political opponents of Coleman are deeply involved in encouraging the action. But no evidence of that has surfaced.

Development 3:
Coleman faced the media on the issue this morning. But he did it in Moorhead, where many of the reporters following the story couldn't be in time, and he didn't say anything new.

Coleman called the allegations in the suit "false and defamatory." He said his wife was "devastated." But he brought nothing forward that would shed light on any of the questions raised by the suit, except for those who are willing to simply take his word for it against McKim's.

Development 4: New documents, attached as exhibits to the refiled suit, do show money flowing from Deep Marine to Hays in amounts and at times that are consistent with McKim's allegations. The documents also show that Hays Companies (the Minneapolis insurance firm that employed Laurie Coleman) submitted invoices for payment. But there is nothing in the new documents that advances the hypothesis that the money was intended to pay Laurie Coleman for work she didn't do. Again, we have nothing but McKim's (sworn) statement that this is what was going on.

That doesn't prove anything either way. If there was a scheme such as McKim alleges, it would presumably be easy enough for Hays to generate invoices, although the number of parties that would have to have knowledge of and participation in the scheme grows with each such step.

Development 5: The AP reports that: Hays Companies said in a statement that it provides risk management consultation to Deep Marine Technology, adding, "We stand by our reputation as leaders in our industry and will not engage in empty speculation that is clearly meant to interfere with the election."

This is helpful to the Coleman/Kazeminy side of the dispute (Kazeminy seems never to talk to anyone), but it also doesn't prove much.

Not being in the business of servicing the underwater needs of the offshore oil and gas industry, I have no clue how credible it is that a Texas company in that business could credibly spend $75,000 in a single year to a Minneapolis insurance firm not for insurance itself but for consulting work about insurance.

If the suit proceeds to the discovery phase, it seems likely that documents will show pretty clearly whether Hays was actually doing work for Deep Marine that could justify the payments. But it seems extremely unlikely that any of these clarifications could occur before Election Day.


Related content:

Sen. Norm Coleman's Oct. 31 statement

Hays Companies Oct. 31 Media Statement

Strib denies Coleman's claim it had lawsuit last week

With five days to go, Senate race gets curiouser and curiouser

Speculation swirls around lawsuit alleging indirect payments to Coleman

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Comments (7)

And after the election when the charges are proved false, will Norm even get an apology?

The lawsuit doesn’t allege that Laurie Coleman received the money, it alleges that the payments went to Hays. Hays has admitted receiving the payments. It further alleges that Kazeminy said it was for the purpose of getting money to the Colemans. Whether he said that or not does not create a problem for Coleman. Coleman is only in trouble if Hays passed the money on to Laurie Coleman and she did not provide the services. The suit makes no claim that Hays did pass the money on to her. The bottom line of the lawsuit is that Coleman’s friend Kazeminy and Otto Candies, Jr. are being accused of pillaging Deep Marine Technologies --- the suit does not claim that Coleman is. Why Coleman press spokesman Cullen Sheehan says about the lawsuit that “It’s totally false and ridiculous” is highly questionable. How can he possibly claim to know whether or not Kazeminy and Candies have done what the suit alleges? If Laurie Coleman did not receive the money, the campaign should have limited its comment to that fact and make it clear they have no idea on what Kazeminy and Candies did or didn’t do to Deep Marine Technologies.

Hays could resolve this matter in a few minutes by simply releasing the details and source of Laurie Coleman’s compensation for the time period in question. Why they haven’t, I don’t know.

Coleman’s claim that Franken was responsible for the filing and timing of the lawsuit is bogus. The law firm filing the lawsuit (the Houston office of Haynes Boone) is a huge corporate law firm of impeccable reputation. Name partner Michael Boone is a friend and major fund raiser for George W. Bush (in 2004 he was a member of the Bush Pioneers for raising in excess of $100,000 for the President). To top it off, Boone is a trustee of Southern Methodist University and a driver in getting the George W. Bush Presidential Library to locate there. The chance that this Republican dominated powerhouse law firm filed the suit at the urging of the Franken campaign is ZERO. They filed this suit because they concluded it had merit and would be a profitable piece of business.

Mike Nlson makes somee really important points here. Questions need to be asked and the Senator needs to answer them and not his wife. Why is Coleman throwing Laurie, his wife up as a shield. Nobody has said that Laurie Coleman did anything wrong. And it is a really curious deflection for Norm to pretend he is protecting his wife and then he throws her into the middle of the fray.

If the purpose of Kazeminy was to get money to Coleman because he felt Norm wasn't making enough and they made a deal to launder the money through the firm Laurie Coleman works for, unless she personally asked for the money to be handed to her, she's not culpable.

And this isn't the first time Norm Coleman has thrown his wife up as a shield to cover for questions of impropriety. Back when it was discovered that Coleman had a favorable below market rental agreement with lobbyist Jeff Larson for accommodations In DC, it was also discovered Coleman didn't pay the rent for months on end. Coleman's answer for this impropriety -- remember he doesn't like his wife brought into it -- he said Laurie had forgot to send the check.

So how can he now be putting ads on TV saying "I'm fair game but leave my wife and family out of it."

The fact that Coleman says these things and really doesn't mean them brings into question his suitability for office and the trust required to represent Minnesota.

Besides, this is what al the politicians who have laundered money through their wives bank accounts, businesses or employment say when caught -- "Don't bring my family into this!" We all know it is not the wife or family member who is making the deal, nor does she need to answer the important questions.

I'll give you this. Norm Coleman hasn't been an exemplary senator for the state, but he hasn't been bad either. He is a republican and so "tends" to follow political lines. Those lines just coincidentally happen to follow the Bush doctrine. Funny how the ad makers can take this all and twist it to make it so bad.

I have a suspicious feeling that the current allegations are false, and ultimately will be proven so in a court of law. In an email to Senator Coleman, I hinted that this should be followed through to fruition and should it be proven to be malicious and dirty, that there come with it a monetary reward from the Franken camp. In fact, even though it states that a private democratic committee put the commercial together, Mr. Franken "Has Approved" of it at the ends of these. This ties him to the commercials. This also does not absolve him of responsibility in this issue.

I don't like Mr. Franken. He really is hostile, mean, underhanded, and rude. If he wins, I bet you he makes a mockery of the Minnesota senate. When this is over, and should he loose, I hope he gives Minnesota the bird once again (he has before), and moves back to New York where there are many of his kind.

Author Editor Jeff Kline says:

"If he wins, I bet you he makes a mockery of the Minnesota senate."

Al Franken is running for the United States Senate, not the Minnesota State Senate.

My bad. Yea, it should say simply the "Senate". The implication is that when he has one of his tirades on the senate floor, he will make Minnesota look bad.

Was not thoroughly screened before hitting the "send"... It happens. Sorry. I'll bow to the west 3 times in the future and say 3 hail-Mary's before hitting the;... oh wait' it says; "Post It!"... I'm being more careful this time.. :-)