"That is a very high standard," Steuerwald said in commenting on the new ethics code. "It began as a judicial standard and has slowly incorporated itself for lawyers and now we have put that standard here for the House members." It's also a standard Steuerwald failed to satisfy when he supported and voted on legislation that would have provided public financing of an $87 million soccer stadium for Ersal Ozdemir's Indy Eleven minor league professional soccer team.
No other state lawmaker knows the deepest and darkest secrets of the shadowy Turkish immigrant better than Rep. Steuerwald, who also serves as Assistant Caucus Leader for the House Republicans. Ozdemir and a former business partner, Jason Ellis, have been embroiled in contentious litigation since 2012 in which they've traded serious accusations of misconduct against each other. Ozdemir fired first with the filing of a lawsuit in Marion County against Ozdemir by Barnes & Thornburg's Edward Smid on June 5, 2012, which sought protection against Ellis disclosing confidential business information. The case was moved to Hendricks County the following month on the motion of Ellis' attorney, Scott Treadway, based upon improper venue, where it now sits in the courtroom of Superior Court Judge Mark Smith.
Curiously, after the case was moved to Hendricks County, Ozdemir added Steuerwald, who maintains a full-time law practice in Danville, Indiana, to his well-seasoned Barnes & Thornburg-led litigation team. Steuerwald's appearance dated August 17, 2012 lists him as representing Ozdemir and a string of his companies, including Keystone Construction Corp., Keystone Group, LLC, Keystone NCS, LLC, Keystone SBC, LLC and Keystone WFLS, LLC.
Separately, Ellis filed a lawsuit against Ozdemir in Hamilton County the following year, which wound up in Superior Court Magistrate David Najjar's coutroom as a special judge after a change of judge. Judge Najjar entered an order staying those proceedings on December 6, 2013 pending resolution of the Hendricks County litigation, and he also signed an order on February 4, 2014 sealing some of those court records on the motion of Ellis' attorney.
In Ellis' lawsuit, a copy of which the IBJ posted online here, he accused Ozdemir of defrauding Ellis out of his 20% ownership interest in Ozdemir's construction and real estate development business. In his complaint charging Ozdemir with breach of fiduciary duty, conversion, fraud, breach of contract and securities fraud, Ellis claimed Ozdemir had cut him out as a partner and shareholder of his business, created inaccurate accounting records, commingled assets and over-billed clients and customers, among other things. Ellis' lawsuit also accused Ozdemir of billing Keystone for lavish personal expenditures, including a multi-million dollar mansion he built for himself in a gated Carmel community. [Read more at the IBJ's website on Ozdemir's "No-holds-barred tactics" that lifted him as a construction and real estate developer.]
According to Hendricks County court records, a bench trial scheduled to begin in that contentious litigation on April 13, 2015 was canceled per an order issued by Judge Smith on February 11, 2015. To say this case has been protracted by numerous discovery disputes between the parties is being generous. Protective orders, contempt proceedings and efforts to keep court records sealed have been par for the course. Ozdemir's attorneys were fighting to quash Ellis' attorneys' attempt to depose Ozdemir as late as last year more than two years after the litigation commenced, which Judge Smith granted. Throughout it all, Steuerwald was immersed in this ongoing saga playing out in a Hendricks County courtroom as a part of Ozdemir's litigation team.
All members of the Indiana General Assembly are required to annually file a Statement of Economic Interest. Steuerwald's most recent statement on file with the House Clerk lists his law firm where he's a partner, Steuerwald Hannon Zielinski & Witham, LLP, as his employer and sole business interest. His statement adds a disclaimer at the bottom of the form in which he states: "Pursuant to the Rules of Professional Conduct applicable to members of the Indiana State Bar Assoc. & Indiana Supreme Court, clients & related matters are confidential matters." Members of the public would have no way of knowing Rep. Steuerwald has been representing the person seeking the largest public subsidy before the legislature this year for years by reading his Statement of Economic Interest.
Fortunately, because court records are public, we can learn that Steuerwald is employed by Ersal Ozdemir in litigation critical to his ongoing, extensive construction and real estate development businesses. Yet he wasn't obliged under House rules to disclose that financial relationship he has with Ozdemir when he came before the House of Representatives with a team of powerful lobbyists to convince state lawmakers they should make Indiana taxpayers finance a new stadium for Ozdemir's Indy Eleven soccer team. Steuerwald was one of 58 House members who supported and voted in favor of SB 308 on its third reading passage on February 27, 2014, which included public financing for Ozdemir's $87 million stadium project. A copy of the roll call can be viewed here. The public financing of the stadium was stripped from SB 308 in conference committee before its final passage.
Ozdemir hired Joe Loftus, an attorney at the same law firm Ozdemir has hired along with Rep. Steuerwald to represent his interests in the litigation with his former business partner, to lobby the Indiana General Assembly to approve public funding for a new soccer stadium, along with Faeger Baker Daniels' Murray Clark and Ice Miller's Carl Drummer. Barnes & Thornburg also brought aboard last September as part of its lobbying team, Michael O'Brien, who serves as the Hendricks County Republican Party Chairman where Steuerwald's district is located. I'm sure that doesn't put any added pressure on a judge who must stand for election in a one party-ruled county like Hendricks County. Several attorneys at Barnes & Thornburg have been generous contributors to Steurerwald's campaign committee in the past, including Bob Grand and Bruce Donaldson.
It gets better. Steuerwald's amended Statement of Economic Interest states that his wife began work for Midwest Constructors, LLC in January of this year. According to Midwest Constructors' website, the firm has been or is currently involved in at least three projects involving Ozdemir's companies, including the controversial Broad Ripple Parking garage for which the City of Indianapolis gave $6.5 million in public funds to Ozdemir to build, the publicly-subsidized City Way project's Alexander Hotel on which Keystone Construction served as construction manager and Butler University's parking garage project that Ozdemir's Keystone Construction was awarded a contract to build. Midwest Constructors also participated in the J.W. Marriott publicly-financed hotel project and Lucas Oil Stadium, both of which are within the PSDA area which would be expanded to provide additional funding to the Capital Improvement Board for the Indy Eleven soccer stadium under HB 1273 as introduced. It was also recently awarded work on the $81 million Market Square Tower project that Indianapolis taxpayers are shelling out over $20 million in subsidies to see built. I'm sure Midwest Constructors' hiring of Steuerwald's wife is just a coincidence.
Will the State House press corp asked Rep. Steuerwald about his conflict of interest? Do you think Rep. Steuerwald will still be publicly supporting and voting in favor of HB 1273, the legislation Rep. Todd Huston (R-Fishers) re-introduced this year seeking again to force Indiana taxpayers to publicly-finance construction of Ozdemir's new soccer stadium? The House Ways & Means Committee has scheduled HB 1273 for a public hearing next Monday morning at 9:00 a.m. Stay tuned.
|Ersal Ozdemir (Indianapolis Star/Danese Kenon Photo)|