Illinois Republican gubernatorial candidate Bruce Rauner reportedly tried to retaliate against a reporter who wrote a negative story about Rauner allegedly threatening a former business partner.
The Chicago Sun-Times reporter, Dave McKinney, hired former federal prosecutor Patrick Collins, who previously represented the United States Attorney's Office in prosecuting former Illinois Gov. George Ryan (R), to investigate whether Rauner pushed the newspaper to take down McKinney's story, according to the trade publication Crain's Chicago Business. Collins told Chicago Business that Rauner's campaign seems to have argued to the Sun-Times that there was a conflict of interest in McKinney writing the story because he's married to Democratic media consultant Ann Liston.
Collins said that the couple created barriers to make sure there was never any question of a conflict of interest. - TPM, 10/20/14
Here's the story they're referring to:
Republican Bruce Rauner had a quick answer when asked to assess blame for the fast collapse of a once-promising business venture created and backed by his one-time Chicago investment firm.
The accomplished CEO he recruited from a high-flying national accounting firm couldn’t make their business-outsourcing firm, LeapSource, based in Tempe, Ariz., profitable because he said she didn’t share his vision of what makes a “good company.”
“The only thing Chris did on a consistent basis, on a timely basis, was spend,” Rauner said. “That’s the easy thing to do.
“The hard thing is getting customers; the hard thing is cutting expenses; the hard thing is laying people off. But that’s what good companies do when times are tough, and she just would not do it,” said Rauner, who sat on LeapSource’s board.
That statement comes from a June 2005 deposition that arose from litigation over a messy corporate divorce between Kirk and Rauner and his business partners at Chicago-based investment firm GTCR.
Her lawsuit against him, GTCR and several of its partners offers a firsthand look into Rauner’s business philosophy. It’s a philosophy Rauner has fine-tuned over the years that he repeatedly has said forms a cornerstone of what kind of Illinois governor he would be as he runs to unseat Gov. Pat Quinn. The lawsuit was settled in 2008 after a judge threw out most of the counts for a variety of legal defects.
The court case provides an unusual window into Rauner’s actions while under the stress of immense financial pressures, his attitude toward claims of hostile work environment and the tactics he employed when it appeared certain that Kirk intended to sue to challenge the start-up’s dismantling.
Kirk alleged in the lawsuit that Rauner threatened her personally and through a LeapSource board member — a claim she made in a sworn deposition. That former LeapSource board member confirmed in a deposition that “threatening things...were said to her” and that he had been involved in some of those conversations. Rauner denied the allegations through a spokesman.
The lawsuit alleged that Rauner told Kirk in February 2001: “If you go legal on us, we’ll hurt you and your family.”
Kirk also alleged that Rauner, wary of a her possibly suing, relayed a similar threat to her a few days earlier through another board member, Thomas Gilman, a consultant and ex-top executive at Chrysler Financial.
“I will bury her,” Rauner is alleged to have told Gilman.
“I will make her radioactive,” Rauner allegedly told Gilman, according to the complaint. “She will never get another job anywhere, ever. I will bankrupt her with legal fees. I don’t know if she has a family or not, but if she does, she better think twice about this.” - Chicago Sun-Times, 10/6/14
Now here's some more info:
Mr. McKinney's attorney, Mr. Collins, contends the Rauner campaign attempted to have the Sun-Times take action against Mr. McKinney because of what it alleged were conflicts of interest stemming from Mr. McKinney's marriage to Democratic media consultant Ann Liston.
Mr. McKinney and Ms. Liston were married in April, but Mr. Collins said the couple made arrangements earlier in the year at each of their jobs to create barriers within their work so that their relationship wouldn't present conflicts of interest for Mr. McKinney, who is the paper's bureau chief in Springfield.
“Dave McKinney has a body of work as a dogged but fair and impartial reporter, and what happened recently was an attempt to unfairly besmirch Dave's reputation and he has asked me to evaluate whether there was an improper interference with Dave's employment relationship with the Sun-Times,” Mr. Collins said in an interview.
Mr. Collins, who is an attorney in Chicago at law firm Perkins Coie, declined to comment on any “legal strategy” for his client.
Mr. McKinney's Oct. 6 story, which he co-wrote with Sun-Times and NBC5 News reporter Carol Marin and Sun-Times reporter Don Moseley, said Mr. Rauner threatened Christine Kirk, who served as CEO of a Tempe, Arizona-based business-outsourcing company called LeapSource that was owned by Mr. Rauner's former firm, GTCR LLC. The threat was disclosed as part of litigation in which Ms. Kirk sued Mr. Rauner and GTCR but agreed to a settlement in 2008. The 'R' in GTCR stands for Rauner, and Mr. Rauner led that firm until 2012.
The Quinn campaign has been using the story in its advertising.
Just hours before the Sun-Times story went to press, the Rauner campaign attempted to quash the piece by bringing up Ms. Liston's political work with Sun-Times management even though Mr. McKinney has been covering the campaign for months, according to Mr. Collins. Mr. Collins didn't have details on who in the Rauner campaign contacted the Sun-Times and who at the newspaper was contacted.
Mr. McKinney has also written stories that were critical of incumbent Democratic candidate Gov. Pat Quinn, specifically his involvement with the troubled state-funded Neighborhood Recovery Initiative.
Recently, Mr. McKinney was inexplicably absent from his statehouse beat for five days despite one of the hottest gubernatorial races in recent memory.
Mr. Englander, the Rauner campaign manager, said the campaign typically doesn't comment on its interactions with news organizations. But, in light of the Crain's report, he explained via email that the Rauner campaign told Sun-Times editors it believed Mr. McKinney had an "extraordinary conflict of interest," given his wife's connections to a group that has spent money advertising against Mr. Rauner, and that the newspaper ought to disclose those ties. That request and a request later for corrections and clarifications to the story were rejected, he said.
Mr. Englander said "no one reached out to" Michael Ferro, chairman of Sun-Times parent Wrapports LLC, who worked with Mr. Rauner in 2011 to buy the newspaper company. - Crain's Chicago Business, 10/17/14
Kind of bizarre, especially since the Sun-Times endorsed Rauner's campaign:
Today we are endorsing Bruce Rauner for governor. Today we are putting our chips — we’re all in — on an extraordinarily capable businessman who just might have what it takes to break the stranglehold of uninspired, self-serving, one-party rule in Springfield.
We look across Illinois and we despair. We see struggling small towns and an antiquated tax structure, monstrous pension debt and population decline, government incompetence and public corruption.
We see an entrenched political class bereft of fresh ideas, basic business acumen, and independence from unions and other special interests. We see professional politicians, beginning with Gov. Pat Quinn and House Speaker Mike Madigan, who have failed to do what must be done before all else — promote economic growth and help create many more new jobs. We see a political status quo that is ruining Illinois.
Then there is Bruce Rauner. In him, we see everything the current occupant of the Governor’s Mansion is not — a smart businessman, skilled executive and born leader beholden to nobody but those of us smart enough to vote him into office. We see that rare candidate who has but one agenda, to get Illinois roaring again for the sake of us all. It’s not like the man needs the money.
Bruce Rauner could be the Michael Bloomberg of Illinois, fiercely free of political control, keeping his distance from the culture wars, achieving the kinds of economic wonders for our state that former Mayor Bloomberg achieved in New York City. - Chicago Sun-Times, 10/17/14
But here's the kicker:
Mr. Rauner previously owned a 10 percent ownership stake in Chicago Sun-Times parent Wrapports LLC. Mr. Rauner sold that stake to Wrapports chief Mr. Ferro last year for $5 million before he decided to run for governor.
The Sun-Times today announced that it would once again begin making political endorsements, reversing a decision it made nearly three years ago after Mr. Ferro, Mr. Rauner and other wealthy Chicagoans purchased the newspaper company in 2011. - Crain's CHicago Business, 10/17/14
But it's very clear that the Sun-Times endorsed the wrong candidate:
The GOP candidate made some of his vast fortune—and continues to collect money—from for-profit schools that are accused in court of exploiting students, handing out worthless degrees, and raking in millions of taxpayer dollars through fraud.
As you've undoubtedly heard by now, Rauner made hundreds of millions of dollars as a leader of the private equity firm GTCR from 1981 to 2012. Though he left the business shortly before launching his bid for governor, he continues to have investments in it.
In 1999 GTCR funded the creation of ForeFront Education, a for-profit company offering college degrees and training for jobs including medical assistants, paralegals, and office administrators. As with all of its investments, GTCR was interested in this segment of higher education because of its growth potential—or, as the Chronicle of Higher Education later reported, "because of its high profit margin."
As investors, Rauner and his colleagues were onto something: the for-profit college industry was entering a boom time. By 2010 it was generating $30 billion a year, according to an investigation by Bloomberg News. But it did so "by targeting vulnerable populations—disabled military and veterans, the homeless, immigrants and minorities—with misleading promises of low costs, online academic help, and lucrative jobs after graduation."
ForeFront's schools were part of the trend. In 2003 ForeFront acquired the Illinois School of Health Careers, with campuses in the Loop and on the far northwest side near O'Hare. Its brochures informed prospective students that the school was "institutionally accredited." It boasted of a "distinguished reputation in Chicago for graduating and placing high-quality students into allied health professions."
In 2010, however, school administrators admitted in a letter to students that one of its programs wasn't actually accredited, and therefore graduates weren't qualified to take state exams to become certified nursing assistants.
A group of students filed a class-action lawsuit in Cook County accusing the school and ForeFront of fraud. If the students had known the truth about the school's credentials—and its difficulty in helping them land jobs—"they would not have enrolled," the lawsuit stated.
The suit was reportedly settled in 2013 for about $1.2 million.
According to GTCR's website, the firm still owns ForeFront and the School of Health Careers, which means the GOP candidate is still profiting from it.
Yet Rauner's campaign says he wasn't responsible—much as he's downplayed his ties to nursing homes accused of substandard care and privatized probation services that prey on the poor.
"Bruce wasn't involved with it, but ForeFront Education made a mistake, apologized for it and tried to correct it by paying for students to take a new program as well as paying them $1,500," says spokesman Mike Schrimpf.
That's not the end of the story. Rauner is also a stockholder in Education Management Corporation (EDMC), which operates more than 100 campuses around the country, including the Illinois Institute of Art in Chicago, Schaumburg, and Tinley Park.
The total enrollment at EDMC schools soared from about 38,000 in 2001 to more than 158,000 in 2010, according to a report from the U.S. Senate committee on health, education, labor, and pensions. And the growth was fueled by taxpayer funds.
In 2011 the federal government, the state of Illinois, and ten other states sued the company and its schools, alleging they committed widespread fraud while collecting $11 billion in federal student aid between 2003 and 2011. Student recruiters—known as assistant directors of admission, or ADAs—were paid solely on the basis of how many warm bodies they were able to enroll, and almost anyone was admitted if it meant more money coming in, the feds said. - Chicago Reader, 10/20/14
Now Quinn has been doing better in the polls but the race is still tight. But he's getting some big name help on the campaign:
President Obama's second public rally of 2014 midterm election took him to familiar turf: the south side of Chicago.
"It's good to be home!" the president shouted to an adoring crowd at the Chicago State University Jones Convocation Center Sunday night. They responded in kind with roaring cheers of support back.
Mr. Obama was on the campaign trail over the weekend for the first time this year. He rallied supporters in the Windy City for incumbent Democratic Governor Pat Quinn, telling them that Quinn "is real."
"He is who he is. He's not trying to front. He's not trying to pretend he's something he's not. He remembers where he came from. He's fighting for you every single day and that's why you gotta have his back," the president said.
He encouraged supporters to get their friends to the polls vote for the Governor -- something he promised to do when he casts his ballot Monday morning as early voting in Illinois gets underway. State election officials are allowing people to vote without a photo ID for the first time this year. - CBS News, 10/20/14
We can win this race as long as our base comes out to the polls. Click here to donate and get involved with Quinn's campaign: