THE EIBENSTEINER STRIKES BACK

Ron Eibensteiner and Ron Jerich's quotes are great. This was all about Hatch sticking it to Republicans.

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Former GOP chairman not guilty of fund charge

Former Minnesota Republican Party Chairman Ron Eibensteiner was acquitted Tuesday on charges of arranging illegal corporate campaign contributions in 2002. The six-member jury took less than three hours to reach a not-guilty verdict on all four counts.

Eibensteiner said the charges against him appeared to be a "vendetta directed to our governor and to me."

"I don't know what the point was ... "he said. "I don't think the prosecutor had a legitimate case."

He lashed out at DFL Attorney General Mike Hatch, a candidate for governor in 2006 and a key prosecution witness in the Eibensteiner case. The charges were pressed by the Mower County attorney.

"If you look to all the court testimony, obviously Hatch was the fellow who perpetrated the whole thing," Eibensteiner said. "I pray that somehow God releases the anger that Mike Hatch has in his heart."

Hatch spokeswoman Leslie Sandberg said the attorney general's office would have no comment.

"It wasn't our trial," Sandberg said.

State DFL Party Chairman Brian Melendez said the criticism of Hatch was unjustified. "Mike Hatch was a witness in the case. The Mower County attorney made the decision to prosecute. Hatch did not," Melendez said. "Our criminal justice system is set up in such a way that the attorney general has very little to do with prosecution at this level.

"The criticism of Mike Hatch is misdirected. Its seems more likely to me that the criticism is politically motivated than that the prosecution was," Melendez said.

Special prosecutor Earl Gray told reporters that he respected the jury's decision.

Thank-you letter was key

Earlier Tuesday, in a 45-minute closing argument, Gray argued that it was clear that Eibensteiner believed that a federal political contribution from American Bankers, a Florida insurance firm eager to influence Minnesota's 2002 gubernatorial election, would come back to be used for Minnesota Republican candidates.

Referring to a letter sent over Eibensteiner's signature to an American Bankers lobbyist, thanking him for the contribution, a letter brought to light by Hatch, Gray told jurors: "You decide. Use your God-given common sense to decide if that letter was not a solicitation."

Gray said Eibensteiner's testimony acknowledging that he was seeking national support for Minnesota candidates was a reference to money coming back to the state.

"He's not asking for life support, ladies and gentlemen. He's asking for money," Gray said.

Eibensteiner's attorney, William Mauzy, told jurors that prosecutors failed to establish that Eibensteiner did anything more than inadvertently sign a thank-you note to American Bankers lobbyist Ron Jerich.

"Is Mr. Eibsensteiner on trial for whether or not he signed a thank-you letter? That would be a silly charge indeed," Mauzy said.

In a 75-minute closing argument, Mauzy said there was no evidence that Eibensteiner knew the purpose behind the American Bankers contributions.

"Never has so much been asked from so little in a criminal trial," Mauzy said. "This is a form letter."

Origins of the case

The case originated during the 2002 gubernatorial campaign. Executives of American Bankers, a company that was in trouble with the state Commerce Department for alleged wrongdoing to consumers, have publicly acknowledged that they wanted to remove then-Commerce Commissioner Jim Bernstein. Former U.S. Rep. Tim Penny was running on the Independence Party ticket and had said that he would retain Bernstein, Gov. Jesse Ventura's commerce commissioner, who was going after the company aggressively. The company's goal was to help defeat Penny.

Company officials at first sought to contribute directly to the state Republican and DFL parties. But when informed that corporate contributions are illegal in Minnesota, they gave $15,000 each to Republican and Democratic national committees.

A crucial piece of evidence was the letter sent to lobbyist Jerich on Sept. 9, 2002, thanking him for obtaining the contribution from American Bankers, which hired him on a $4,500 monthly retainer to help it navigate through Minnesota politics. The key phrase in the letter, signed by Eibensteiner, was, "your contribution will help us accomplish our budget goal."

The prosecution contended that this was an open admission that the corporate money from American Bankers would be spent illegally in Minnesota.

Contacted after the verdict was announced, Jerich, a former friend and ally of Hatch's, expressed anger that Hatch took and kept the Eibensteiner thank-you letter from Jerich's home after Jerich showed it to him:

"This thing should have never been brought to trial in the first place," Jerich said. "There's no doubt in my mind that Hatch perpetrated this whole thing to get at the Republicans."

Eibensteiner was defeated in June by Ron Carey in his bid for a fourth term as state Republican Party chairman. Source: Star Tribune, November 16, 2005