David Samson, the former New Jersey attorney general and head of the Port Authority of New York and New Jersey, pleaded guilty Thursday to bribery for pressuring United Airlines to operate a non-stop flight from Newark to South Carolina for his personal convenience.
United flew between Newark Liberty International Airport and Columbia Metropolitan Airport in South Carolina only because Samson wanted to travel to his house there.
The airline entered into a non-prosecution agreement (pdf) with the New Jersey U.S. Attorney’s Office requiring it to cooperate, to reform its compliance program, and to pay a $2.25 million penalty.
The DOJ also charged Jamie Fox, a consultant and lobbyist for United Continental Holdings Inc., the Chicago-based parent company of United Airlines Inc., in a separate criminal complaint with conspiring to commit bribery.
Samson, 76, of Aiken, South Carolina, served as New Jersey attorney general from 2002 to 2003.
He was a founder and chairman of the influential law firm Wolff & Samson based in West Orange, New Jersey.
Samson’s close friend, Governor Chris Christie, appointed him to chair the Port Authority of New York and New Jersey in 2011.
Samson resigned from his Port Authority post in 2014 after a political scandal involving lane closures of the George Washington Bridge
He left Wolff & Samson in 2015. The firm rebranded itself as Chiesa Shahinian & Giantomasi. It has about 130 lawyers, according to its website.
Samson pleaded guilty Thursday in federal court in Newark. He was charged with one count of bribery.
Fox, 61, of Lambertville, New Jersey, was charged separately with conspiring with Samson to commit bribery. He served as the commissioner of the N.J. Department of Transportation from September 2014 to October 2015.
The Port Authority operates Newark Airport, one of United’s biggest hubs.
After Samson became chair of the Port Authority in 2011, he asked United to reinstate the Newark/Columbia route. United declined because the route wouldn’t be profitable
Samson (and Fox on Samson’s behalf) threatened to abrogate a hangar agreement between United and the Port Authority unless the route was reinstated.
Samson wrote Fox [in late 2011] that he was “reviewing current Board agenda items of interest.” Referring to the hangar agreement, Fox suggested to Samson that “[m]aybe it needs further review!!!!!,” to which Samson responded “[y]es, it’s already off this month’s agenda: I hate myself.” Following through on this exchange with Fox, Samson caused the hangar agreement to be removed from the Port Authority Board’s agenda.
United then started flights from Newark Airport to Columbia Airport on Thursdays and Mondays.
Samson used the Newark/Columbia route 27 times between October 2012 and January 2014.
Samson and others referred to the Newark/Columbia route as the “Chairman’s Flight” and Fox referred to it as “Samson Air.”
Samson faced up to 10 years in prison. Under his plea agreement (pdf), the DOJ won’t ask for a prison sentence of more than 24 months. Judge Jose Linares set sentencing for October 20.
Fox faces up to five years in prison.
United agreed in the NPA to cooperate with the DOJ, to report periodically for two years about its compliance efforts, and to “continue to implement an enhanced compliance program designed to prevent and detect bribery and corruption violations.”
“If United abides by the terms of the agreement, the Office has agreed not to prosecute United for its conduct relating to the Newark/Columbia route,” the DOJ said.
The DOJ said United got credit for disclosing all non-privileged information about its employees and agents related to the Newark/Columbia route, conducting an internal investigation, making its employees available for interviews, producing documents and other materials, and making multiple presentations to the DOJ.
United also undertook “early and extensive remediation.” It improved its Ethics and Compliance Office, enhanced its global code of conduct and anti-bribery / anti-corruption policies, conducted extensive training, and fired employees involved in the decision about the Newark/Columbia route.
United also developed a third-party due diligence process and compliance audit, the DOJ said.
Richard L. Cassin is the publisher and editor of the FCPA Blog. He’ll be the keynote speaker at the FCPA Blog NYC Conference 2016.