Larry Speaks — Householder Trial Update #9

03.2.2023

By Sandy Theis, former reporter and political analyst

CINCINNATI — Former Speaker Larry Householder and lobbyist Bob Klaffky disputed details of testimony presented two weeks ago by government witnesses in what the FBI has called the biggest public corruption case in America. Still, they both agreed on some important facts.

  • FirstEnergy Solutions (FES), the utility that stood to benefit the most from passage of the nuclear bailout at the center of the case, gave $500,000 in total to a dark money group that prosecutors say was used to launder and conceal bribes. 
  • FirstEnergy Solutions had no Political Action Committee. PACs limit how much donors can give and require contributions to be disclosed. Corporations, however, can give secret and unlimited donations to dark money groups such as Generation Now — the group that accepted the $500,000. Generation Now has pleaded guilty to hiding the bribes.

One day after federal prosecutors rested their case in U.S. District Court in Cincinnati, Householder took the stand in his own defense and denied that he passed the bailout in exchange for about $60 million from FirstEnergy and its subsidiary funneled through a web of dark money groups.

Both Householder and Klaffky also disputed some details provided by Juan Cespedes, an FES lobbyist who testified that he personally witnessed Klaffky slide a $400,000 check across a table and tuck it under Householder’s hand. Cespedes, who pleaded guilty to participating in racketeering in 2020, said it was made clear during the meeting that the money was in exchange for the bailout.

“Did you slide the check across the table?’’ Householder lawyer Robert Glickman asked.

Householder chuckled.

“There wasn’t even a table to slide it across,’’ he said, insisting that the meeting was brief and happened as the group sat on couches with no nearby tables. Klaffky also said there was no table. Both men identified FirstEnergy Solutions’ top lobbyist David Griffing as the man who gave Householder the check.

Householder’s testimony is expected to continue Thursday, followed by prosecutors’ cross examination.

Householder and his lawyers used much of his testimony to paint him as a family man from Appalachia who cares deeply about helping Ohio. He repeatedly said he is disgusted by the rise in “divisiveness” at the Ohio Statehouse and said he pushed hard to pass the bailout out of a desire to preserve carbon-free power and help Ohio’s business climate.

‘’When you look at Ohio we have always been a great industrial power, and we have been an energy producer,’’ Householder said.

Reasons to Question Householder’s Testimony Commitment to Green Energy 

The Ohio Manufacturers’ Association, Ohio’s leading trade association for industrial power, has been a consistent critic of House Bill 6 — the bailout law, contending that it costs customers money — especially manufacturers that pay some of the biggest electric bills in Ohio. 

Householder’s repeated assertion that he aimed to help the environment does not explain why the bailout law also stuck Ohio residents with the cost of subsiding Cold War-era coal plants, gutted Ohio’s renewable energy portfolio and its energy efficiency standards or why Householder and his allies have a history of hostility toward wind and solar power.

Householder Testified about His Leadership Style 

Defense lawyers also asked Householder about testimony from prosecution witness Jeff Longstreth, who also had previously pleaded guilty. The former Householder political strategist portrayed Householder as a ruthless leader who demanded loyalty from his fellow Republicans and punished people who crossed him.

Not so, Householder testified. He pointed out that his leadership team included House candidates who supported a rival candidate for Speaker and said he did not punish bailout opponents by sidelining their legislation or removing them from coveted committees. assignments.

Former Speaker Ryan Smith and Larry Householder battled over control of the Ohio House.

Householder Disputes Pay-to-Play 

Householder also disputed federal prosecutors’ theory that the pay-to-play scheme was hatched over pricey steak dinners with utility executives in Washington, D.C., during former President Donald Trump’s 2017 inauguration. Householder said he never attended the dinners and although he did fly to the inaugural on FirstEnergy’s plane, he provided bank records that showed he reimbursed the Akron utility for the flights.

Prosecutors are expected to ask Householder about his prior testimony and evidence that contradicts those claims. 

Reasons to Question Klaffky’s Testimony

Klaffky has said several times that he did not recall specifics from the meeting in which the $400,000 was handed over, but he denied even hinting that the check was in exchange for the bailout. Assistant U.S. Attorney Matt Singer pointed out that participating in a pay-to-play scheme would end Klaffky’s career as a powerful lobbyist.

Householder is on trial with co-defendant Matt Borges, former chairman of the Ohio Republican Party. Prosecutors allege that FirstEnergy pumped $61 million in bribes through dark money political groups to help Householder regain the powerful Speaker’s job and in turn pass a bailout bill worth $1.3 billion to FirstEnergy and its former subsidiary FirstEnergy Solutions. Householder and Borges worked to defeat a referendum campaign against the bailout, and Borges is accused of bribing a person working on the referendum for inside information. Both pleaded not guilty.

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