STATE OF RHODE ISLAND AND PROVIDENCE PLANTATIONS ... Rhode Island, a Rhode Island non-profit corporation,

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  • STATE OF RHODE ISLAND AND PROVIDENCE PLANTATIONS

    PROVIDENCE, SC. SUPERIOR COURT

    (FILED: July 24, 2020)

    FRANCIS X. FLAHERTY, :

    Plaintiff, :

    :

    v. : C.A. No. PC-2019-5088

    :

    THE RHODE ISLAND ETHICS :

    COMMISSION AND ITS MEMBERS, ROSS :

    E. CHEIT, MARISA A. QUINN, ARIANNE :

    CORRENTE, M. THERESE ANTONE, R.S.M., :

    J. DOUGLAS BENNET, DR. TIMOTHY :

    MURPHY, AND DR. ROBERT A. SALK, IN :

    THEIR OFFICIAL CAPACITIES, :

    Defendants. :

    DECISION

    STERN, J. Before the Court is Plaintiff Francis X. Flaherty’s (Plaintiff or Respondent)

    administrative appeal challenging a decision of the Rhode Island Ethics Commission (Ethics

    Commission) finding that he committed a knowing and willful violation of Commission

    Regulation 36-14-17008 (Regulation 36-14-17008) and imposing a civil penalty. Jurisdiction is

    pursuant to G.L. 1956 § 42-35-15.

    I

    Facts and Travel

    Since 2003, Plaintiff has served as an Associate Justice of the Rhode Island Supreme

    Court. R. Ex. S (Stipulated Facts) ¶ 1. On or about September 22, 2016, Helen L. Hyde

    (Complainant) filed a complaint with the Ethics Commission, alleging that from 2010 through

    2015 Plaintiff failed to disclose his position as President of the St. Thomas More Society of

  • 2

    Rhode Island (Society) on his annual financial disclosure filings with the Ethics Commission.1

    See R. Ex. A (Complaint). The Complaint was docketed by the Ethics Commission as

    Complaint No. 2016-14. See id. On or about October 11, 2016, the Commission Prosecutor (the

    Prosecutor or the Prosecution) submitted an Initial Determination Report, finding that the facts

    alleged in the Complaint—when taken as true—were sufficient to constitute a knowing and

    willful violation of the Rhode Island Code of Ethics (the Code of Ethics). See R. Ex. B.

    A

    Preliminary Investigation, Motions, and Hearing

    Thereafter, both the Plaintiff and the Complainant were given notice of the Ethics

    Commission’s determination that the Complaint alleged sufficient allegations to constitute a

    violation of the Code of Ethics. See R. Ex. C. The Ethics Commission advised that it would be

    conducting further investigation into the allegations. Id. After approximately four months of

    investigation, the Prosecutor submitted an Investigative Report. See R. Ex. D. The Investigative

    Report summarized the evidence as follows:

    “Evidence adduced during the investigation establishes that the

    Respondent served as President of the St. Thomas More Society of

    Rhode Island, a Rhode Island non-profit corporation, during

    calendar years 2010-2015. On his 2010-2015 Financial Disclosure

    Statements filed with the Commission pursuant to R.I. Gen. Laws

    § 36-14-16, the Respondent failed to list his executive position

    held in the St. Thomas More Society of Rhode Island, as required

    1 The Complainant also appended numerous exhibits to the Complaint relating to a civil action

    she filed against the Roman Catholic Bishop of Providence (RCB). See Complaint at Exs. 1-4;

    18; 20-21. It appears that the Complainant filed suit against the RBC, alleging that a priest under

    their supervision “took advantage of and sexually abused several children.” Complaint at Ex. 4,

    at 2. The trial court granted summary judgment in favor of the RBC. Id. at 1. The Complainant

    appealed, and our Supreme Court affirmed the grant of summary judgment. Id. at 22. The

    Plaintiff—for a unanimous court—authored the decision affirming the grant of summary

    judgment. Id. at 1. However, the Ethics Commission explicitly excluded these exhibits from

    their determination. See R. Ex. B (Initial Determination Report) n.1.

  • 3

    by Commission Regulation 36-14-17008, Leadership Positions

    with Not-For-Profit Organizations.” Id.

    Through the Investigative Report, the Prosecutor suggested to the Ethics Commission that

    probable cause existed that the Plaintiff failed to list his position with the Society on his

    Financial Disclosure Statements, as required by the Code of Ethics.2 Id.

    The Plaintiff, through counsel, filed a Motion to Dismiss for Lack of Probable Cause,

    alleging that his omission of the Society from the Financial Disclosure Forms did not constitute a

    knowing and willful violation of the Code of Ethics. See R. Ex. E. The Ethics Commission held

    a hearing on April 25, 2017, and after considering the Complaint, Investigative Report, and the

    Motion to Dismiss for Lack of Probable Cause, the Ethics Commission found that probable

    cause existed to believe that Plaintiff violated the Code of Ethics. See R. Ex. G. Thereafter,

    Plaintiff filed three Motions to Dismiss: the first motion to dismiss alleged that the Ethics

    Commission exceeded its authority in enacting Regulation 36-14-17008, see R. Ex. H; the

    second motion to dismiss alleged that the Ethics Commission proceedings denied Plaintiff due

    process, see R. Ex. I; and the third motion to dismiss alleged that the Plaintiff did not commit a

    knowing and willful violation of the Code of Ethics. See R. Ex. J. The Prosecution filed

    objections and memoranda in opposition to each motion to dismiss. See R. Exs. K-M.

    The Ethics Commission heard Plaintiff’s motions to dismiss on November 20, 2018. See

    R. Ex. N. The Ethics Commission heard oral argument from both Plaintiff’s counsel and the

    Prosecutor, and the Ethics Commission members were allowed to ask questions of counsel. See,

    e.g., id. at 2:11-15. The Ethics Commission voted unanimously to deny Plaintiff’s first and

    second motions to dismiss. See id. at 19:12-20:2; 42:8-24. As to the third motion to dismiss,

    2 The Investigative Report did not specify whether probable cause existed to believe that

    Plaintiff’s failure to list his position as President of the Society was knowing and willful.

  • 4

    Plaintiff’s counsel conceded that it was similar to the Motion to Dismiss for Lack of Probable

    Cause—which the Ethics Commission denied on April 25, 2017—and was being advanced to

    preserve the record. Id. at 43:2-6. Accordingly, argument and discussion on the third motion to

    dismiss was limited, and the Ethics Commission voted 4-1 to deny the third motion to dismiss.

    Id. at 45:18-46:14. The next day, the Ethics Commission entered orders denying each of the three

    motions to dismiss. See R. Exs. O-Q.

    B

    Adjudicatory Hearing

    On February 26, 2019, the Ethics Commission heard a full adjudicatory hearing on the

    Complaint. See R. Ex. R at 5:1-5. Plaintiff and the Prosecution submitted a Stipulation agreeing

    to certain facts and the admission of certain documents as full exhibits. See R. Ex. S. The

    Stipulation was admitted as Joint Exhibit 1, see R. Ex. R. at 10:13-14, and the Prosecution

    proceeded with its opening statement and presentation of its case-in-chief. See, e.g., id. at 10:15-

    18:5.

    1

    Prosecution’s Case-in-Chief

    For its case-in-chief, the Prosecution did not call any witnesses and instead relied on the

    stipulated facts and documentary evidence to argue that the Plaintiff committed a knowing and

    willful violation of the Code of Ethics by failing to disclose his position as President of the

    Society on his Financial Disclosure Forms for the years 2010-2015. See id. at 16:11-19; 17:15-

    17. Specifically, the Prosecution admitted evidence that the Society was incorporated in 1998 as

    a Rhode Island nonprofit corporation pursuant to G.L. 1956 §§ 7-6-1, et seq. (the Rhode Island

    Nonprofit Corporation Act). See R. Ex. T-1; see also R. Ex. S, ¶ 4. Pursuant to the Rhode Island

  • 5

    Nonprofit Corporation Act, the Society was required to file an annual report with the Rhode

    Island Secretary of State, which it did for each of the relevant years (2010-2015). See R. Ex. R

    at 13:21-14:2. On the Society’s annual reports filed with the Secretary of State for the years

    2010-2015, the Plaintiff was listed as the President of the Society. See R. Ex. T-2; see also R.

    Ex. S, ¶ 2. The Prosecution noted that the Society’s bylaws designate the President as the chief

    executive officer of the Society and vests him or her with the authority to “supervise[] and

    control[] all the corporation’s business and affairs,” including calling and presiding over

    meetings, and serving as a member of the Society’s Board of Directors. See R. Ex. T-3, § 6.02.

    The Prosecution then went on to explain Regulation 36-14-17008, which took effect on

    April 15, 2008, and requires that Financial Disclosure Statements filed in accordance with G.L.

    1956 § 36-14-16 “shall include, in addition to any other requirements, a list of all boards of

    directors, trustees or equivalent fiduciary positions of which the person is a member and all

    executive officer positions which the

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