SIGN UP FOR THE BREITBART EMAIL NEWSLETTER

Indictment Puts Harry Reid at Center of Menendez Effort to Intervene With HHS on Behalf of Donor

Senate Minority Leader Harry Reid (D-NV) plays a key role in the corruption indictment of Senator Robert Menendez (D-NJ), handed down by a Newark, New Jersey grand jury. Reid’s involvement centers around efforts by Menendez to intervene with Secretary of Health and Human Services (HHS) Kathleen Sebelius on behalf of his friend and donor Dr. Salomon Melgen in an $8.9 million Medicare billing dispute.

The 68-page indictment devotes a full 8 pages to a section entitled “After MELGEN Receives More Unfavorable Rulings, MENENDEZ Enlists the Office of the Senate Majority Leader to Assist MELGEN in His Medicare Billing Dispute.”

The indictment focuses on $600,000 Melgen, a Florida opthalmologist, donated in 2012 to Senate Majority PAC, a Super PAC closely linked to Reid run and managed by former staffers with whom he communicates closely, that was earmarked for Menendez’s successful 2012 re-election campaign. All told, Melgen contributed $700,000 to Senate Majority PAC in 2012.

As former chief assistant U.S. attorney for the Southern District of New York Andy McCarthy tells Breitbart News:

Sen. Menendez is charged with agreeing to accept valuable things from Dr. Melgen in return for being influenced in the performance of his official duties. It has been reported that Senate Democratic leader Harry Reid also accepted valuable things from Melgen, including $700,000 donated to Reid’s super PAC in 2012 … the same year that, according to the Menendez indictment, Reid used his official position to help Menendez lobby the Department of Health and Human Services on Melgen’s behalf, including arranging a meeting for Menendez with Secretary Sebelius herself.

Though the indictment says Senator 3 [easily identifiable as Reid] set up an August 2, 2012 meeting between Menendez and Sebelius where Menendez overtly lobbied Sebelius on Melgen’s behalf, the indictment does not specifically state that Reid was at the meeting, though several media reports confirmed he was in attendance.

McCarthy finds that omission noteworthy.

“Curiously, the Justice Department has chosen not to mention Reid’s presence at that meeting in its indictment — the very meeting at which Sebelius was pressed, unsuccessfully, to find in Melgen’s favor in an $8.9 million Medicare billing dispute,” McCarthy tells Breitbart News.

“Quantity-wise, the indictment describes far more extensive questionable conduct on Menendez’s part than on Reid’s,” McCarthy adds.

“But if we look at quality — i.e., if we try to tease out the Obama Justice Department’s theory of what kind of conduct constitutes prosecutable public corruption — it is hard draw a clear dividing line between what Menendez is accused of and what Reid has apparently done, or indeed what many Washington politicians routinely do,” McCarthy concludes.

The intervention plan in which Menendez enlisted Reid began almost a year before Reid in effect compelled Sebelius to attend that fateful August 2, 2012 meeting in his Capitol Hill offices.

“On or about September 19, 2011,” the indictment reads, “MELGEN forwarded to MENENDEZ an email from Lobbyist 1 entitled ‘Secretary Authority.’” The most likely candidate to be described as Lobbyist 1 in the indictment is Melgen attorney Alan Reider, a partner at the prestigious Washington, D.C. law firm Arnold & Porter.

Reider represented Melgen in his administrative appeals of the $8.9 million Medicare overbilling dispute adjudicated at HHS.

Breitbart News asked Reider to confirm or deny that he is Lobbyist 1 mentioned in the indictment, but he has not responded.

“Among other things,” the indictment continues, “the email said the following:”

[I]f the MAC were contacted by CMS and advised that CMS believed that the position of the provider were correct, it would eliminate the dispute and the MAC would dismiss the appeal. Naturally, in that case, First Coast would be directed by CMS to make payment [of $8.9 million] to you. Since CMS is subject to the Secretary’s oversight, my contact believed that the Secretary could direct CMS to drop its opposition and notify the MAC that it agreed with the position of the provider…

Given these facts, it seems to me that the best approach to the Secretary is not to ask for the Secretary to direct the MAC to find in your favor, but to ask the Secretary to direct CMS to reverse its position and to notify the MAC that it agrees with you. (emphasis added)

In Melgen’s thinking, apparently, financial contributions to Menendez and political organizations controlled by and loyal to Menendez and Reid were critical to the success of this influence peddling scheme.

On June 8, 2012, according to Federal Election Commission records, Melgen donated $300,000 through his wholly owned company, Vitreo-Retinal Consultants, to the Reid affiliated Senate Majority PAC. This donation was specifically mentioned in the indictment as part of the quid pro quo arrangement between Menendez and Melgen. Even though the SuperPAC was, in effect, a Harry Reid vehicle, this particular donation was earmarked to assist in Menendez’s successful 2012 re-election.

On June 28, 2012 Melgen’s Vitreo-Retinal Consultants donated an additional $100,000 to the Reid affiliated Senate Majority PAC. This donation is not mentioned in the indictment as it was not earmarked to assist in Menendez’s successful 2012 re-election. The presumption is this was a no-strings attached donation that Reid could direct the Super PACs executives to place where he wanted.

On October 16, 2012 Melgen’s Vitreo Retinal Consultants donated an additional $300,000 to the Reid affiliated Senate Majority PAC. This donation was also specifically mentioned in the indictment as part of the quid pro quo arrangement between Menendez and Melgen. This particular donation was earmarked to assist in Menendez’s successful 2012 re-election.

All told, Melgen’s Vitreo-Retinal Consultants donated $700,000 to the Senate Majority PAC in 2012, $600,000 of which was earmarked to assist in Menendez’s re-election, $100,000 of which was not earmarked.

Then, on July 2, 2012, according to the indictment, “MENENDEZ expressed dissatisfaction with the Acting Administrator of CMS’s answers and stated that he would speak directly with the Secretary of HHS about the matter.”

The next week, according to the indictment, barely two weeks after the Reid affiliated Senate Majority PAC received a non-earmarked $100,000 contribution from Melgen, “[o]n or about July 10, 2012, Senator 3’s [Harry Reid’s] scheduler contacted HHS, stating that “[Senator 3-Harry Reid] would like to have a meeting with [the Secretary of HHS] and Senator Menendez sometime in the next couple of weeks.”

Three days later, Menendez’s staff reminded him about the importance of informing Melgen about Reid’s involvement.

“On or about July 13, 2012,” the indictment reads, “Staffer 1 [Menendez COS from 2008 to 2014] emailed MENENDEZ asking whether he, MENENDEZ, had informed MELGEN that Senator 3 [Reid] was organizing a meeting with the Secretary of HHS. MENENDEZ responded, ‘Haven’t told Dr Melgen yet. Prefer to know when we r meeting her so that I don’t raise expectation just in case it falls apart.’”

Preparation for the Menendez-Reid-Sebelius meeting was detailed and thorough. The indictment shows that Melgen’s attorney was keen on offering Menendez and Reid a way to “plausibly deny” that the meeting was an attempt to influence on the Melgen $8.9 million billing dispute, should news of the meeting ever come to light.

As the indictment reads:

On or about July 24, 2012, Person A sent an email to MENENDEZ entitled “Dr. Melgen” with an attachment entitled “Letter to [the Acting Administrator of CMS] (7-23-12).” In the email to MENENDEZ, Person A wrote “Attached please find the proposed letter that was sent to [Staffer 1] by [Lobbyist 1–an attorney and partner at Arnold & Porter]. Dr. Melgen wanted me to send it to you as well.” The draft letter submitted by MELGEN’s lobbyist/lawyer does not mention MELGEN by name, but advocates on behalf of his position and twice references “the Medicare contractor in Florida.”

This phrasing was eerily reflected in comments made by Menendez spokesperson Tricia Enright after news of the Aug 2, 2012 meeting broke last month. As Breitbart News reported, “Menendez denied discussing anything but legislative matters in the August 2 meeting with Sebelius and Reid” through spokesperson Tricia Enright, who said “the senator did not mention Melgen during their [August 2 2012] meeting.” But the indictment tells a different story.

“During MENENDEZ’s meeting with the Secretary of HHS, MENENDEZ advocated on behalf of MELGEN’s position in his Medicare billing dispute, focusing on MELGEN’s specific case and asserting that MELGEN was being treated unfairly,” the indictment reads.

“The Secretary of HHS disagreed with MENENDEZ’s position, explaining that CMS was not going to pay for the same vial of medicine twice, and emphasizing that CDC guidelines expressly advised against multiple applications from the same vial to prevent potential contamination. The Secretary of HHS also informed MENENDEZ that because MELGEN’s case was in the administrative appeals process, she had no power to influence it,” the indictment continues.

For several months after this August 2, 2012 meeting, Menendez, Menendez staffers, Reid staffers, and a fundraiser for Senate Majority PAC continued to press HHS officials on Melgen’s behalf and to keep Melgen informed about their progress.

It is clear from their communications they believed they were, in fact, having an influence on internal HHS adjudicative processes.

As the indictment reads:

On or about September 13, 2012, Staffer 13 reached out by email to HHS 6, an Assistant Secretary at HHS, to see if “there might be any news from your end on the meeting your boss’s [sic] had right before recess.” HH6 did not respond.

On or about October 19, 2012, at approximately 5:03 pm, MELGEN emailed the same attachment described in 221 [a memo from MELGEN’s Lobbyist 1 advising how Secretary Sebelius can intervene in MAC appeal on MELGEN’s behalf–MPL insert] to Fundraiser 2, a Majority PAC fundraiser and former staffer to and fundraiser for Senator 3 [Harry Reid].

An email referred to in the indictment suggests Reid’s Senior Health Counsel was also present at the Aug 2 meeting, and was kept apprised of the MAC appeal for several months thereafter.

On or about October 20, 2012, Fundraiser 2 responded to MELGEN’s email, stating:

Dr. Sal,

I’m going to see him [Harry Reid] on Tuesday. I will give him this directly. Is that ok?

I am sure he will forward this to [the Senior Health Counsel for Senator 3] in his office. She was the staff person in the meeting before [probably the meeting with Sebelius on August 2, 2012]. I would suggest someone come in and brief her on the updated information.

Another email from Lobbyist 1 – possibly Melgen’s attorney, Arnold & Porter partner Alan Reider — suggests that the intervention efforts of Menendez and Reid had caused an HHS bureaucrat to intervene in the proceedings.

“On or about October 22, 2012 MELGEN forwarded to MENENDEZ he received from Lobbyist 1 on or about October 20, 2012,” the indictment reads.

“The email from Lobbyist 1 to MELGEN,” the indictment continues, “reads as follows:”

Sal — the sleeping bear has awakened. I attach a letter received today from the Medicare Appeals Council. The letter denies our request for oral argument but gives us an additional 30 days to submit a supplemental brief. It would not surprise me if this was triggered by the meetings earlier this summer and someone looking into the status of the case. When they found it was not moving, they pushed it, hoping that this would satisfy you. (emphasis added)

This section of the indictment ends on an ominous note for Reid, a central character in the events the Department of Justice says were criminal acts by Menendez and Melgen.

“All [of the above is] in violation of Title 18, United States Code, Section 371,” the indictment reads.

A spokesperson for the Reid affiliated SuperPAC, the Senate Majority PAC, attempted to minimize the impact of the indictment on both Reid and the Senate Majority PAC late Wednesday.

“Nothing in today’s indictment casts doubt on the lawfulness of Senate Majority PAC, its actions, or its mission.The FEC has specifically held that super PACs may accept contributions earmarked for particular races — and indeed, they routinely do,” executive director Stephanie Potter said in a statement.

Melgen, Potter claimed, was just “one of hundreds of donors supporting Senate Majority PAC’s mission of electing Democrats to the US Senate.”

Breitbart News asked Senator Reid’s office if, in Reid’s opinion, he could potentially become the target of a DOJ investigation but received no response.

P.S. DO YOU WANT MORE ARTICLES
LIKE THIS ONE DELIVERED RIGHT TO YOUR INBOX?
SIGN UP FOR THE DAILY BREITBART NEWSLETTER.


Comment count on this article reflects comments made on Breitbart.com and Facebook. Visit Breitbart's Facebook Page.

SIGN UP FOR THE OFFICIAL
BREITBART EMAIL NEWSLETTER

GET TODAY'S TOP NEWS DELIVERED RIGHT TO YOUR INBOX

I don't want to get today's top news.

x