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Tanoos v. State

Court of Appeals of Indiana

December 6, 2019

Daniel Tanoos, Appellant-Defendant,
v.
State of Indiana, Appellee-Plaintiff.

          Appeal from the Marion Superior Court The Honorable Lisa F. Borges, Judge Trial Court Cause No. 49G04-1809-FC-32385

          ATTORNEYS FOR APPELLANT James H. Voyles, Jr. Jennifer M. Lukemeyer Tyler D. Helmond Indianapolis, Indiana

          ATTORNEYS FOR APPELLEE F. Aaron Negangard Chief Deputy Attorney General Stephen R. Creason Chief Counsel of Appeals Indianapolis, Indiana

          ALTICE, JUDGE.

         Case Summary

         [¶1] Former Superintendent of the Vigo County School Corporation (VCSC) Daniel Tanoos was charged with three counts of bribery regarding his solicitation and acceptance of meals, tickets, and other items from a vendor that repeatedly contracted with and provided energy solutions to VCSC. The trial court denied Tanoos's motion to dismiss the charges, and Tanoos appeals, asserting that the trial court abused its discretion when it failed to dismiss the charges because the facts alleged do not constitute the offense of bribery.

         [¶2] We affirm.

         Facts & Procedural History

         [¶3] Tanoos began as Superintendent with VCSC in 1999 or 2000 and retired in 2018. Energy Systems Group (ESG) is a state-certified guaranteed energy savings contractor (GESC) headquartered in Indiana and with offices in Indianapolis, that develops and provides energy solutions to governmental bodies to reduce energy and operating costs under Ind. Code Chapter 36-1-12.5.[1] ESG provides clients with such things as upgraded lighting and HVAC at no added cost to the client, as energy savings are used to pay for the investment over a period of years. At times relevant to this action, Doug Tischbein was the corporate director of ESG, and he was in charge of the VCSC account beginning in either 2006 or as early as 2003. Between 2000 and 2016, VCSC entered into nine contracts with ESG worth more than $42 million.

         [¶4] On September 24, 2018, Indianapolis Metropolitan Police Department Detective Tara Asher, who was assigned to the Marion County Prosecutor's Grand Jury Unit, filed a 24-page probable cause affidavit (the PCA) averring that, in August 2018, she received information from FBI Special Agent Joann Dowell that the FBI had been investigating Tanoos based on information that the FBI had received from Indiana's State Board of Accounts (SBOA) regarding concerns of improper awarding of contracts by VCSC to ESG. Based on the information that the FBI received from the SBOA, the FBI opened a public corruption investigation in February 2016. FBI agents executed search warrants at several VCSC locations, collecting digital and documentary evidence related to ESG's relationship with VCSC, and in particular, Tanoos's relationship with ESG and Tischbein. The FBI investigation included information received from an FBI confidential source with access to VCSC contracts and the contracting process. The investigation also included interviews with various VCSC personnel, school board members, and ESG personnel, including Tischbein. ESG expense reports and emails were provided pursuant to subpoena.

         [¶5] Persons interviewed indicated that Tanoos always recommended ESG to the school board as the GESC for renovations throughout the district and that other competitors quit responding to published Request for Qualifications. The PCA reflected that Tanoos continued to receive tickets and meals and the like at times when ESG did not have a contract with VCSC, with Tischbein explaining to his superiors that there were upcoming planned VCSC school renovations, that Tanoos "is loyal to us" and "a certain level of investment into maintaining that relationship is vital." Appellant's Appendix Vol. II at 29. Both Tanoos and Tischbein denied in interviews that Tanoos solicited or expected Tischbein to buy things in exchange for Tanoos's recommendation of ESG to the school board.

         [¶6] According to ESG records obtained in the investigation, Tischbein expensed more than $18, 000 between the years of 2006 and 2016 for meals, events, and miscellaneous items, and that amount did not include company-owned season tickets to sporting events or items paid personally by Tischbein. In the same time period, ESG made more than $83, 000 in donations related to the VCSC account. Detective Asher summarized in the PCA, "Evidence obtained through the investigation showed that Tischbein and ESG routinely provided benefits and perks to Tanoos and VCSC school board members in an effort to continue receiving work from VCSC" and, "[o]ver time, Tanoos began soliciting such perks of his own accord, sometimes pairing the request with information about ESG competitors or while otherwise offering support to ESG." Id. at 20.

         [¶7] Detective Asher found the following instances "of greatest concern":

1. The August 24, 2013 dinner at Mo's Steakhouse . . . and Colts game for Tanoos and friends and family. The dinner was paid for by ESG at Tanoos' request without ESG employees present. Tanoos solicited the Colts' [sic] tickets immediately following Tischbein asking him if he knew another county's school superintendent for an opportunity to do a project there;
2. The July 11, 2014 dinner at Palm Restaurant, Nashville. Tanoos solicited this dinner immediately after making Tischbein privy to a competitor's solicitation of VCSC. The dinner cost over $1000 and neither Tischbein nor any other ESG employees attended. Notably, Tischbein did not expense this dinner as a business expense;
3. The August 10, 2014 REO Speedwagon concert. Tanoos directly solicited tickets for this concert which included a limousine ride and complimentary liquor near the end of the Phase 8 contract.

Id. at 42.

         [¶8] On September 24, 2018, the State filed an information against Tanoos alleging three counts of bribery, Count I as a Class C felony and Counts II and III as Level 5 felonies:

COUNT I: DANIEL TANOOS, on or about August 24, 2013, did solicit, accept, or agree to accept any property, that is: food and/or beverages, except property the person is authorized by law to accept, with intent to control the performance of an act, that is: recommendation to award contract and/or continued business with ESG to the Vigo County School Board related to the employment or function of a public servant, that is: Superintendent of Vigo County School Corporation;
COUNT II: DANIEL TANOOS, on or about July 11, 2014, did solicit, accept, or agree to accept any property, that is: food and/or beverages, except property the person is authorized by law to accept, with intent to control the performance of an act, that is: recommendation to award contract and/or continued business with ESG to the Vigo County School Board related to the employment or function of a public servant, that is: Superintendent of Vigo County School Corporation;
COUNT III: DANIEL TANOOS, on or about August 10, 2014, did solicit, accept, or agree to accept any property, that is: tickets and/or beverages, except property the person is authorized by law to accept, with intent to control the performance of an act, that is: recommendation to award contract and/or continued business with ESG to the Vigo County School Board, related to the employment or function of a public servant, that is: Superintendent of Vigo County School Corporation[.]

Id. at 17-18.

         [¶9] On October 22, 2018, Tanoos filed a motion to dismiss, seeking dismissal of all three charges on several grounds, the following of which is relevant to this appeal: The facts stated in the charging information do not constitute the offense of bribery because "Indiana does not recognize a 'generalized bribe' theory . . . and the State is required to prove the existence of an explicit quid pro quo", and here, the charging information's allegation that Tanoos would recommend to VCSC to award a contract or continue business with ESG was too general and, thus, insufficient.[2] He maintained that the State was required to show "that any of these solicitations, acceptances, or agreements to accept food/beverages/tickets were [] made on a quid pro quo basis, i.e., in exchange for Tanoos'[s] agreement or promise to recommend ESG for any particular project." Id. at 60.

         [¶10] The Indiana Association of Public School Superintendents (The Association) requested and received permission to file an amicus curiae brief in support of Tanoos. The Association stated that it was not suggesting that school vendors' "extensions of goodwill and thanks in the form of meals, events, and tickets" should be allowed to cloud the judgment of school leaders, but it is "necessary and unavoidable for superintendents to interact with past, current, and future business associates," and the charges against Tanoos "have created uncertainty as to how the Indiana bribery statute can and will be enforced in the future." Id. at 87. The Association explained:

Under the State's reading of the Indiana bribery statute, prosecutors could allege violations of the statute when superintendents and other public officials accept anything, at any time, from any person or business that has, is, or may do business with the public official. Public officials around the state would have no guidance as to where the line is drawn and legitimate and essential business and public-relation relationships would be chilled. School systems, municipalities and other public programs would suffer. Businesses could reconsider investments in Indiana. And it is not difficult ...

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