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IN THE COURT OF COMMON PLEAS OF FRANKLIN COUNTY, OHIO - - - - C. Paul Tipps and Public Policy Consultants, Inc., Plaintiffs, vs. Neil S. Clark, NSC, Inc., and State Street Consultants, LLC,
: : : : Case No. 08CVH-12-18090 Judge Lynch : : :
Defendants. : - - - - VIDEOTAPED DEPOSITION OF THOMAS A. RANKIN - - - - -
Taken at Bailey Cavalieri LLC 10 West Broad Street, 21st Floor Columbus, OH 43215 January 5, 2009, 10:18 a.m. - - - - Spectrum Reporting LLC 333 Stewart Avenue, Columbus, Ohio 43206 614-444-1000 or 800-635-9071 www.spectrumreporting.com - - - - -
Thomas Rankin
January 5, 2009
2 1
A P P E A R A N C E S
2
ON BEHALF OF PLAINTIFFS: 3
Bailey Cavalieri LLC 4
10 West Broad Street, 21st Floor Columbus, OH 43215
5
By Danny L. Cvetanovich, Esq. Sabrina C. Haurin, Esq.
6 7 8
ON BEHALF OF DEFENDANTS: Robert J. Behal Law Offices, LLC 501 South High Street
9
Columbus, OH 43215 By Robert J. Behal, Esq.
10 11 12
John M. Gonzales, Esq. ON BEHALF OF THE WITNESS: Isaac, Brant, Ledman & Teetor 250 East Broad Street
13
Columbus, OH
43215
By Mr. Mark R. Weaver, Esq. 14 15 16
ALSO PRESENT: Jeremy Dineen - Videographer C. Paul Tipps
17 18 19 20 21 22 23 24
Thomas Rankin
January 5, 2009
3 1 2
Monday Morning Session January 5, 2009, 10:18 a.m.
3
- - - - -
4
S T I P U L A T I O N S
5
- - - - -
6
It is stipulated by counsel in attendance that
7
the deposition of Thomas A. Rankin, a witness
8
herein, called by the Plaintiffs for
9
cross-examination, may be taken at this time by
10
the notary pursuant to notice, that said
11
deposition may be reduced to writing in stenotypy
12
by the notary, whose notes may thereafter be
13
transcribed out of the presence of the witness;
14
that proof of the official character and
15
qualification of the notary is waived.
16 17 18 19 20 21 22 23 24
- - - - -
Thomas Rankin
January 5, 2009
4 1
I N D E X
2
Examination By
3
Mr. Cvetanovich - Cross
Page 6
4
Plaintiff Exhibits
Page
5
2 - Notice
of federal tax lien
39
6
3 - Notice of federal tax lien
67
7
4 - SSC 12 Month Cash-Flow Report, 2006
206
5 - SSC 12 Month Cash-Flow Report, 2007
220
6 - SSC 12 Month Cash-Flow Report, 2007
231
7 - SSC 12 Month Cash-Flow Report, 2008
236
8 - SSC balance sheet, December 31, 2006
239
9 - State Street Partners Profit & Loss,
240
8
9
10
11
12
13
January through December 2007
14
10 - State Street Consultants balance sheet,
241
December 31, 2007 15
11 - State Street Consultants profit & loss, 16
January through December 2006
17
12 - State Street Consultants profit & loss, January through December 2007
18 19 20 21 22 23 24
(Exhibits attached to original transcript.)
242 243
Thomas Rankin
January 5, 2009
5 1
THE VIDEOGRAPHER:
2
record at 10:18.
3
their presence.
4
We are on the
Would counsel please announce
MR. CVETANOVICH:
Yes.
My name is Dan
5
Cvetanovich.
6
firm of Columbus, Ohio, and I'm here on behalf of
7
the Plaintiffs.
8 9
I'm with the Bailey Cavalieri law
MR. BEHAL:
I'm Bob Behal.
I'm here on
behalf of State Street Partners -- pardon me,
10
State Street Consultants, LLC, Neil S. Clark, and
11
NSC Consulting Corp.
12
MR. WEAVER:
I'm Mark Weaver from the
13
Columbus law firm Isaac Brant, Ledman and Teetor.
14
I represent the witness, Thomas Rankin.
15
- - - - -
16
THOMAS A. RANKIN
17
being first duly sworn, testifies and says as
18
follows:
19
MR. CVETANOVICH:
Before I put the
20
question to the witness, Bob, I have a question
21
for you.
22
note that you're here on behalf of State Street
23
Partners.
24
State Street Partners?
We did this the other day.
You did not
Do you intend to be here on behalf of
Thomas Rankin
January 5, 2009
6 1
MR. BEHAL:
2
MR. CVETANOVICH:
3
MR. BEHAL:
State Street Partners. Yes, sir.
Well, I don't think that
4
Paul has hired me to represent State Street
5
Partners, and he's the managing member, so --
6
managing partner, I should say.
7 8
MR. CVETANOVICH:
You are right, and I
stand corrected.
9
- - - - -
10
CROSS-EXAMINATION
11
BY MR. CVETANOVICH:
12
Q.
13
name, please.
14
A.
He's Mr. Weaver.
15
Q.
Excuse me.
16
Mark's full name.
17
Mr. Weaver, will you tell us your full
Mr. Rankin -- we know
Mr. Rankin, will you tell us your full
18
name, please.
19
A.
Thomas A. Rankin.
20
Q.
What does the A stand for?
21
A.
Andrew.
22
Q.
What is your date of birth?
23
A.
7-26-64.
24
Q.
What is your residential address?
Thomas Rankin
January 5, 2009
7 1
A.
2
43004.
3
Q.
4
from that address?
5
A.
No.
6
Q.
How long have you lived there?
7
A.
Nine years, about.
8
Q.
Have you ever been known by any names
9
other than Thomas A. Rankin?
996 Poppy Hills Drive, Blacklick, Ohio,
Do you have any present plans to move
10
A.
Tom.
11
Q.
Other than that, do you have any other
12
nicknames by which you're commonly known among
13
family members or friends?
14
A.
No.
15
Q.
Would you give us an overview, please,
16
of your postsecondary education, formal education.
17
A.
18
degree.
19
Q.
20
upon you?
21
A.
1986.
22
Q.
What degree is that?
23
A.
Bachelor's of business administration.
24
Q.
What is your profession currently,
Cleveland State University, four-year
In what year was your degree conferred
Thomas Rankin
January 5, 2009
8 1
Mr. Rankin?
2
A.
What do you mean?
3
Q.
What is your profession?
4
do for a living?
5
A.
I'm a CPA.
6
Q.
When did you receive your CPA
7
certification?
8
A.
1989, thereabouts.
9
Q.
Would you give us, please, an overview
10
of your public accounting experience.
11
A.
12
1992.
What do you
I was with Ernst & Whinney from 1987 to And then with Ciuni and Panichi from --
13
MR. BEHAL:
14
THE WITNESS:
Spell that. C-I-U-N-I and Panichi,
15
P-A-N-I-C-H-I, from 1992 to 1996.
16
Q.
17
1996?
18
A.
19
practice.
20
Q.
What was the name of the company?
21
A.
Paragon Advisors.
22
Q.
What was the nature of its business?
23
A.
We were chief financial officers for
24
wealthy families, outside chief financial
What did you do in your career then in
I worked for a company in a nonpublic
Thomas Rankin
January 5, 2009
9 1
officers.
2
Q.
What was your position at Paragon?
3
A.
Employee.
4
Q.
What kind of things did you do?
5
A.
Tax work, primarily.
6
Q.
How long were you there?
7
A.
1996 through 1999.
8
Q.
What did you do in your career then in
9
1999 when you left Paragon?
10
A.
Established my own practice.
11
Q.
Did you establish an accounting
12
practice?
13
A.
Tax.
14
Q.
Did you create some entity or have some
15
entity created through which you then conducted
16
your tax practice?
17
A.
Yes.
18
Q.
What was the name of the entity?
19
A.
Thomas A. Rankin & Co.
20
catchy.
21
Q.
22
still in existence?
23
A.
Yes.
24
Q.
Has it been in existence continuously
I like it.
It's pretty
Is Thomas A. Rankin & Co.
Thomas Rankin
January 5, 2009
10 1
since you had it created back in or about 1999?
2
A.
Yes.
3
Q.
Have you personally remained affiliated
4
with it continuously since the entity was created?
5
A.
Yes.
6
Q.
What is your capacity with Thomas A.
7
Rankin & Co.?
8
A.
Employee/owner.
9
Q.
Are you the sole owner of the business?
10
A.
Yes.
11
Q.
What is the nature of the business of
12
Thomas A. Rankin & Co.?
13
A.
Tax consultings.
14
Q.
Tax consulting?
15
A.
Yes.
16
Q.
Does it provide other kinds of
17
accounting services to its clients?
18
A.
Yes.
19
Q.
What other kinds of accounting
20
services?
21
A.
Bookkeeping.
22
Q.
All right.
23
A.
Tax preparation.
24
Q.
Anything else?
Bookkeeping. Anything else?
Thomas Rankin
January 5, 2009
11 1
A.
Payroll service.
2
Q.
Does Thomas A. Rankin & Co. provide any
3
auditing services to its clients?
4
A.
No.
5
Q.
How many employees does Thomas A.
6
Rankin & Co. have?
7
A.
One.
8
Q.
Just you?
9
A.
Yes.
10
Q.
What is the greatest number of
11
employees Thomas A. Rankin & Co. has had?
12
A.
Three.
13
Q.
When Thomas A. Rankin & Co. has had
14
more employees than just you, what were the
15
capacities of the others?
16
A.
Staff.
17
Q.
Were they nonprofessional employees?
18
A.
Be specific.
19
Q.
Were they accountants?
20
A.
No.
21
Q.
How many clients does Thomas A. Rankin
22
& Co. have currently?
23
A.
Approximately 80.
24
Q.
Is State Street Consultants, LLC, a
Thomas Rankin
January 5, 2009
12 1
client of Thomas A. Rankin & Co.?
2
A.
Yes.
3
Q.
For how long has that been the case?
4
A.
Seven years.
5
Q.
Is State Street Partners, PL -- what is
6
it, PLLP?
I'm not saying it right.
7 8
MR. BEHAL:
PLL, I think, isn't it?
PLL.
9
MR. CVETANOVICH:
PLL, thank you, Bob.
10
Q.
11
of Thomas A. Rankin & Associates[sic]?
12
A.
Yes.
13
Q.
For how long has that been the case?
14
A.
Seven years.
15
Q.
Is NSC Consulting Corporation a client
16
of Thomas A. Rankin & Co.?
17
A.
Yes.
18
Q.
For how long has that been the case?
19
A.
Nine years.
20
Q.
Do you know someone named Neil S.
21
Clark?
22
A.
Yes.
23
Q.
Is Neil S. Clark personally a client of
24
Thomas A. Rankin & Co.?
Is State Street Partners, PLL, a client
Thomas Rankin
January 5, 2009
13 1
A.
Yes.
2
Q.
For how long has that been the case?
3
A.
Nine years.
4
Q.
Do you know someone formerly known as
5
Toni Clark, a former spouse of Neil Clark?
6
A.
Yes.
7
Q.
Has she ever been a client of Thomas A.
8
Rankin & Associates?
9
A.
I don't recall.
10
Q.
Would Thomas A. Rankin & Associates
11
have books or records that you could consult which
12
would tell you whether Toni Clark was a client of
13
Thomas A. Rankin & Associates?
14
A.
Yes.
15
Q.
Can you tell me whether Toni Clark or
16
the former Toni Clark is currently a client of
17
Thomas A. Rankin & Associates?
18
A.
She is not.
19
Q.
Is it the case that she has not been a
20
client of Thomas A. Rankin & Associates at least
21
since she and Neil Clark were divorced?
22
A.
Yes.
23
Q.
Do you know someone named Kathy Clark,
24
another former spouse of Neil Clark?
Thomas Rankin
January 5, 2009
14 1
A.
Yes.
2
Q.
Was she ever a client of Thomas A.
3
Rankin & Associates?
4
A.
Individually?
5
Q.
Yes, sir.
6
A.
No.
7
Q.
During the time that she was married to
8
Neil Clark, was she a client of Thomas A. Rankin &
9
Associates?
10
A.
Yes.
11
Q.
Had she been a client of Thomas A.
12
Rankin & Associates before she and Neil Clark were
13
married?
14
A.
No.
15
Q.
Has she been a client of Thomas A.
16
Rankin & Associates at any time since Kathy Clark
17
and Neil Clark were divorced?
18
A.
No.
19
Q.
What manner of services does Thomas A.
20
Rankin & Associates provide to State Street
21
Consultants?
22
A.
Tax services.
23
Q.
Any other services?
24
A.
Bookkeeping services.
Thomas Rankin
January 5, 2009
15 1
Q.
Any other services?
2
A.
Payroll service, payroll tax service.
3
Q.
I want to make sure I understood your
4
last answer there, Mr. Rankin.
5
services and payroll tax services two different
6
categories?
7
A.
Yes.
8
Q.
Any other services that Thomas A.
9
Rankin & Associates provides to State Street
Are payroll
10
Consultants?
11
A.
General business service.
12
Q.
What does that mean exactly?
13
A.
Financial service, any general
14
business-type service.
15
Q.
Is that a consulting service?
16
A.
Yeah.
17
Q.
In -- in this category of general
18
business services, are there any specific tasks
19
apart from consulting with the management of SSC
20
that Thomas A. Rankin & Associates provides to
21
State Street Consultants?
22
A.
No.
23
Q.
Has the package of -- well, strike
24
that.
Not clear.
Let me ask the question this way.
Have
Thomas Rankin
January 5, 2009
16 1
these categories of services that your company
2
provides for SSC been the same throughout the
3
relationship?
4
A.
No.
5
Q.
In the beginning, which of these
6
services did Thomas A. Rankin & Associates not
7
provide to State Street Consultants?
8
A.
Payroll tax.
9
Q.
Any others?
10
A.
General business consulting.
11
Q.
Any others?
12
A.
No.
13
Q.
When did Thomas A. Rankin & Associates
14
begin to provide payroll tax services to State
15
Street Consultants?
16
A.
2006.
17
Q.
When did Thomas A. Rankin & Associates
18
begin to provide general business services to
19
State Street Consultants?
20
A.
21 22 23 24
2005, maybe. MR. BEHAL:
Are you guessing or do you
know? THE WITNESS:
I'm guessing it was
somewhere in that time period.
Thomas Rankin
January 5, 2009
17 1
Q.
2
nature of the payroll services that Thomas A.
3
Rankin & Associates provides to State Street
4
Consultants.
5
A.
6
payroll account, I initiate a transfer of funds to
7
pay to have State Street Consultants pay the
8
payroll tax.
9
Q.
Would you describe for us, please, the
When the money is available in the
Just a bit ago, Mr. Rankin, you told me
10
that the payroll services that your company
11
provides to State Street Consultants and the
12
payroll tax services that your company provides to
13
State Street Consultants are distinct categories.
14
And the question that I just asked you was:
15
you describe for us, please, the nature of the
16
payroll services that Thomas A. Rankin &
17
Associates provides to State Street Consultants.
18
Is what you just related to me something you
19
consider to be a payroll service and not a payroll
20
tax service?
21
A.
22
actual paying of the employees.
23
Q.
24
anything else?
I view the payroll service as the
Would
Does the payroll service encompass
Thomas Rankin
January 5, 2009
18 1
A.
Issuing W-2s.
2
Q.
Anything else?
3
A.
No.
4
Q.
Does State Street Consultants use a
5
payroll service other than the services of Thomas
6
A. Rankin & Associates?
7
A.
Yes.
8
Q.
Do you know the name of it?
9
A.
I don't remember.
10
Q.
Do you know for how long State Street
11
Consultants has used a payroll service other than
12
the services of Thomas A. Rankin & Associates?
13
A.
I don't know.
14
Q.
Is it the case that State Street
15
Consultants' payroll function is handled in part
16
by this payroll service and in part through the
17
services provided by your company?
18
A.
Yes.
19
Q.
What does the payroll service do for
20
State Street Consultants?
21
A.
Pays the employees.
22
Q.
Is there anything else the payroll
23
service does as part of its contribution to State
24
Street Consultants' overall payroll function?
Thomas Rankin
January 5, 2009
19 1
A.
2
payroll tax returns.
3
Q.
Anything else?
4
A.
Not that I know of.
5
Q.
I had asked you before to describe for
6
us the nature of the payroll services that your
7
company provides to State Street Consultants, and
8
you told me when the money is available in the
9
payroll account you initiate a transfer of funds
Prepares forms to be used to file
10
to pay to have State Street Consultants pay the
11
payroll tax.
12
anything else in the nature of payroll services
13
that your company provides to State Street
14
Consultants?
15
A.
I review the payroll tax return.
16
Q.
Is that a payroll service or is that a
17
payroll tax service?
18
A.
It's a tax form.
19
Q.
I'm just trying to understand in which
20
category you would put it, because you said there
21
were two different categories.
22
A.
23
paying the employees.
24
Q.
My question to you now is:
Right.
Is there
I view the payroll service as
All right.
And is there anything you
Thomas Rankin
January 5, 2009
20 1
haven't already described to me that your company
2
does in the nature of providing a payroll service
3
to State Street Consultants?
4
A.
Can you repeat that?
5
Q.
Yes, sir.
6
A.
Thank you.
7
Q.
Is there anything you haven't already
8
described to me that your company does in the
9
nature of providing a payroll service to State
I'm sorry.
10
Street Consultants?
11
A.
No.
12
Q.
Now let's move over to the category of
13
payroll tax services.
14
please, what payroll tax services your company
15
provides to State Street Consultants.
16
A.
17
instructed to do so, I will initiate a transfer of
18
funds to pay payroll tax obligations.
19
Q.
20
Rankin & Associates does for State Street
21
Consultants that you characterize as payroll tax
22
services?
23
A.
I review the payroll tax forms.
24
Q.
Anything else?
Can you describe for me,
When funds are available and I'm
Is there anything else that Thomas A.
Thomas Rankin
January 5, 2009
21 1
A.
I file the payroll tax forms.
2
Q.
Anything else?
3
A.
No.
4
Q.
This may seem very basic to you, but
5
just to be sure I understand your terminology,
6
what do you mean by payroll taxes?
7
A.
Withholdings and employer obligations.
8
Q.
What employer obligations?
9
A.
Social Security match, Medicare match,
10
Ohio unemployment, workers' comp.
11
Q.
Anything else?
12
A.
No.
13
Q.
So if we put these several categories
14
together, we would have what you've referred to as
15
payroll taxes?
16
A.
Yes.
17
Q.
Okay.
18
the nature of a couple of these categories.
19
you refer to withholdings, you're referring, are
20
you not, to moneys withheld from employee
21
paychecks to be remitted to taxing authorities?
22
A.
Yes.
23
Q.
So that's the employees' money, right?
24
A.
It's the government's.
I want to be sure I understand When
Thomas Rankin
January 5, 2009
22 1
Q.
2
ends up with everything.
3
it's withheld from employee paychecks, it is the
4
employee's money to then be remitted to the
5
government, correct?
6
A.
Yes.
7
Q.
And in addition to income taxes that
8
are withheld from employee paychecks, Social
9
Security taxes are also withheld from employee
Well, it is at a point.
The government
But at the point that
10
paychecks, correct?
11
A.
Yes.
12
Q.
And so that's the employee's money that
13
then has to be remitted to the government,
14
correct?
15
A.
Yes.
16
Q.
And that's the employer's obligation to
17
withhold it and remit, correct?
18
A.
Yes.
19
Q.
In addition to withholding Social
20
Security taxes, if you will, from employee
21
paychecks, the employer has an obligation to match
22
those amounts and then remit that to the
23
government as well, correct?
24
A.
Yes.
Thomas Rankin
January 5, 2009
23 1
Q.
2
Medicare taxes, is it not?
3
A.
Yes.
4
Q.
Now, just on a couple of these other
5
categories, my sense is they may be different, but
6
I want to hear that from you.
7
compensation taxes, are those withheld from the
8
employee paychecks?
9
A.
No.
10
Q.
So that's just an employer obligation,
11
correct?
12
A.
Yes.
13
Q.
And then workers' compensation
14
premiums, those are not withheld from employee
15
paychecks either, correct?
16
A.
Correct.
17
Q.
Paying workers' compensation premiums
18
is the obligation of the employer, correct?
19
A.
Yes.
20
Q.
With regard to the categories of
21
payroll taxes as we've just gone through them that
22
are withheld from employee paychecks, at the point
23
of withholding, those funds are immediately
24
available to be remitted to the government,
And the same thing is true with
Ohio unemployment
Thomas Rankin
January 5, 2009
24 1
correct?
2
A.
Unless the money's not in the account.
3
Q.
Isn't the money supposed to be in the
4
account since it is money that's being withheld
5
from an employee paycheck?
6
MR. BEHAL:
Objection.
Calls for a
7
legal conclusion, but you can answer.
8
Q.
You may respond.
9
A.
Yes.
10
Q.
And when the employer withholds that
11
money, it is withholding the money from the
12
employee paycheck for the purpose of then
13
remitting the money to the government, correct?
14
A.
Yes.
15
Q.
You said to me a few moments ago,
16
Mr. Rankin, and this was when you were describing
17
for me the payroll tax services that your company
18
provides to State Street Consultants, you said:
19
When funds are available and I'm instructed to do
20
so, I will initiate a transfer of funds to pay
21
payroll tax obligations.
22
Who is it at SSC, State Street
23
Consultants, that gives you such instructions?
24
A.
Neil Clark.
Thomas Rankin
January 5, 2009
25 1
Q.
Anyone else?
2
A.
No.
3
Q.
In the relationship that Thomas A.
4
Rankin & Associates has with State Street
5
Consultants, are you authorized to initiate such a
6
transfer of funds without receiving the directive
7
from Mr. Clark?
8
A.
No.
9
Q.
When such directives are forthcoming
10
from Mr. Clark, are they initiated by him, or is
11
it instead a situation where you go to him and
12
say, Mr. Clark, or, Neil, this is due, shall I
13
transfer?
14
A.
Can you repeat that?
15
Q.
Yes.
16
you and Mr. Clark interact and how you interact
17
which then gives rise to him saying, transfer the
18
money.
19
That's what it boils down to.
20
A.
I would go to him.
21
Q.
Is it the case that it's your
22
responsibility to keep track of when remittances
23
of withholding taxes are due?
24
A.
I'm sorry.
I'm just trying to understand how
Does he come to you or do you go to him?
No.
Thomas Rankin
January 5, 2009
26 1
Q.
Whose responsibility is that?
2
A.
Payroll service.
3
Q.
The outside company that State Street
4
Consultants uses?
5
A.
Yes.
6
Q.
Does it issue reminders, to your
7
knowledge, to State Street Consultants of when
8
various withholding taxes must be remitted?
9
A.
Yes.
10
Q.
Are those written notices or reminders
11
from the payroll services company?
12
A.
Yes.
13
Q.
Do you know how they're transmitted?
14
A.
With each payroll run.
15
Q.
Are they transmitted electronically?
16
A.
No.
17
Q.
Is there a piece of paper that is in
18
the nature of a notice that comes along with the
19
payroll run?
20
A.
Yes.
21
Q.
Do you see those notices?
22
A.
They are given to me.
23
Q.
They are received initially by someone
24
at State Street Consultants?
Thomas Rankin
January 5, 2009
27 1
A.
Yes.
2
Q.
Who is that someone?
3
A.
Jane Harrison.
4
Q.
Is it Ms. Harrison who then gives them
5
to you?
6
A.
Yes.
7
Q.
Is it the practice that she directs
8
them to you or is to direct them to you each time
9
such a notice is received?
10
A.
I don't know.
11
Q.
Is that how it tends to work out?
12
A.
I don't know.
13
Q.
When you receive those notices, what do
14
you do with them?
15
A.
Hold them.
16
Q.
Do you read them?
17
A.
Yes.
18
Q.
For what purpose do you read them?
19
A.
To identify when payroll taxes are due.
20
Q.
Once you have noted that from the
21
notices, do you do anything in the nature of
22
verifying the correctness of the information on
23
the notice?
24
A.
No.
Thomas Rankin
January 5, 2009
28 1
Q.
2
Street Consultants are relying on the payroll
3
service to have it correct?
4 5
MR. BEHAL: Q.
6 7
Objection.
You may respond. MR. BEHAL:
As to whether he can speak
for SSC.
8 9
Is it fair to say that you and State
MR. CVETANOVICH: objection.
That's a fair
Let me break the question into two
10
pieces.
11
Q.
12
upon the payroll service to have that information
13
correct?
14
A.
Yes.
15
Q.
Once you get such notice, you look at
16
such a notice, what do you do?
17
A.
Put it on my desk.
18
Q.
Is there any action that you take in
19
response to receiving such a notice?
20
A.
Not until the tax is due.
21
Q.
Is the due date for the tax different
22
for the various categories that we went through
23
just a bit ago?
24
A.
Is it fair to say that you are relying
Yes.
Thomas Rankin
January 5, 2009
29 1
Q.
Do you know all those due dates?
2
A.
The form -- the form dictates the due
3
date.
4
Q.
5
due date?
6
A.
Sure.
7
Q.
And do the due dates differ for various
8
categories?
9
A.
Yes.
10
Q.
When you get one of these notices
11
through the payroll service and Ms. Harrison, do
12
you then compute due dates?
13
A.
I don't know what you mean.
14
Q.
Well, you get the information from the
15
payroll service.
16
frames within which moneys have to be remitted to
17
various taxing authorities, correct?
18
A.
Yes.
19
Q.
And you know where to find those time
20
frames.
21
A.
Yes.
22
Q.
What I'm trying to understand is when
23
you get such a notice from the payroll service
24
through Ms. Harrison, do you then sit down, or
So you know where to look to find the
You know that there are time
Did you say they're on the forms, right?
Thomas Rankin
January 5, 2009
30 1
stand up, for that matter, and pin down what the
2
due dates are on the various remittances that need
3
to be made so that you can docket them or put them
4
on a calendar or in some kind of a follow-up
5
system to assure that payments get made timely?
6
A.
I leave the notice on my desk.
7
Q.
Does the notice itself, though, tell
8
you the due dates for the various categories of
9
what you've called withholding taxes or payroll
10
taxes?
11
A.
Yes.
12
Q.
Do you review the notices on your desk
13
periodically?
14
A.
Yes.
15
Q.
Do you come in and look at the notices
16
every single day?
17
A.
No.
18
Q.
How often do you look at the notices to
19
see what's due or what's coming due?
20
A.
I don't -- I don't remember.
21
Q.
You don't know what your normal
22
practice is?
23
A.
I look at things on my desk.
24
Q.
Pretty much every day?
Thomas Rankin
January 5, 2009
31 1
A.
Yes.
2
Q.
When you see that one or another of
3
these categories of payroll taxes is coming due,
4
what then do you do?
5
A.
6
account to pay the payroll tax.
7
Q.
8 9
I will ask if there's money in the
Who do you ask? MR. BEHAL:
With regard to SSC or
generally?
10
MR. CVETANOVICH:
11
MR. BEHAL:
SSC.
Thank you.
12
A.
I'll ask Jane or Neil.
13
Q.
Jane being Jane Harrison?
14
A.
Yes.
15
Q.
And Neil being Mr. Clark?
16
A.
That's correct.
17
Q.
If the money's not there but the tax is
18
due, what do you do?
19
A.
I don't initiate a transfer.
20
Q.
Couldn't do that, could you?
21
A.
No.
22
Q.
Could you do anything else?
23
anything else?
24
A.
No.
Do you do
Thomas Rankin
January 5, 2009
32 1
Q.
2
automatically initiate a transfer?
3
A.
Yes.
4
Q.
Do you need to secure Mr. Clark's
5
authorization first?
6
A.
No.
7
Q.
Are you a signatory on any of State
8
Street Consultants' banking accounts?
9
A.
No.
10
Q.
What banking accounts does State Street
11
Account -- excuse me, State Street Consultants
12
have?
13
A.
I don't know.
14
Q.
Are you aware of any instances during
15
the time that you and your company have had a
16
relationship with State Street Consultants when it
17
was delinquent in remitting payroll taxes?
18
A.
19
missed the first part of that.
20
Q.
21
instances during the time that you and your
22
company have had a relationship with State Street
23
Consultants when it was delinquent in remitting
24
payroll taxes?
If the money is there, do you
Can you say that again?
That's all right.
I'm sorry.
I
Are you aware of any
Thomas Rankin
January 5, 2009
33 1
A.
Yes.
2
Q.
How many times has that happened?
3
A.
I don't know exactly.
4
Q.
What's your best estimate?
5
A.
My guess?
6
Q.
Estimate.
7
A.
Estimate?
8
Q.
Yes, sir.
9
MR. BEHAL:
Objection.
10
Q.
You may respond.
11
A.
Forty.
12
Q.
What categories of payroll taxes has
13
State Street Consultants been delinquent in
14
remitting during the time that you've had a
15
relationship with them?
16
A.
Payroll taxes delinquent?
17
Q.
Yes, sir.
18
A.
Federal, state, local.
19
Q.
Any other categories?
20
A.
Not that I remember.
21
Q.
How about Social Security taxes?
22
A.
That would fall under federal.
23
Q.
All right.
24
fall under federal?
What categories?
How about Medicare?
Also
You need to say yes or no.
Thomas Rankin
January 5, 2009
34 1
A.
Yes.
2
Q.
How about workers' compensation
3
premiums?
4
A.
I don't remember.
5
Q.
How about unemployment compensation
6
taxes?
7
A.
I don't know.
8
Q.
Are you aware of any instance when
9
State Street Consultants failed to timely remit
10
payroll taxes to the taxing authorities when it
11
had money available to pay the taxes?
12
A.
No.
13
Q.
Are you familiar with something known
14
as 431 taxes?
15
A.
No.
16
Q.
No?
17
A.
Can I get a little water?
18
Q.
Oh, sure, by all means.
19 20
I don't remember.
THE VIDEOGRAPHER:
MR. CVETANOVICH:
22
THE VIDEOGRAPHER:
24
Do you want to go
off the record?
21
23
Sure.
We may. We are off the
record at 11:02. (A brief recess is taken.)
Thomas Rankin
January 5, 2009
35 1
THE VIDEOGRAPHER:
We are back on the
2
record at 11:10.
3
Q.
4
off-the-record discussion with your counsel,
5
Mr. Weaver, he indicated to me that you would like
6
to clarify some of the things you said to me
7
before we took our break.
8
ahead and do that.
9
A.
Mr. Rankin, during a brief
Why don't you just go
I wanted to clarify the authority I
10
have to pay -- or to initiate a payroll tax
11
transfer, in that I have a blanket authority to
12
initiate the transfer if there's funds in the
13
account, and I re -- I ask Ms. Harrison if funds
14
are in the account to be able to initiate the
15
transfer.
16
Q.
17
clarify?
18
A.
19
if I do any other services or perform any other
20
services relating to payroll tax.
21
contact with the IRS relating to State Street
22
Consultants' delinquent taxes.
23
Q.
24
your complete answer?
Is there anything else you'd like to
I have -- on payroll tax you asked me
I have been in
When you say -- excuse me.
Is that
Thomas Rankin
January 5, 2009
36 1
A.
Yes.
2
Q.
Anything else you want to clarify?
3
A.
No.
4
Q.
Okay.
5
contact with the IRS on State Street Consultants'
6
delinquent taxes, in what capacity have you made
7
such a contact or been part of such a contact with
8
the Internal Revenue Service?
9
A.
When you say you've been in
Under a power of attorney State Street
10
Consultants has granted me the authority to
11
discuss payroll tax issues with them.
12
Q.
13
as Section 941 taxes?
14
A.
I don't think it's Section 941.
15
Q.
All right.
16
something known as 941 taxes?
17
A.
Yes.
18
Q.
Good.
19
A.
That refers to the form.
20
Q.
Okay.
21
A.
941 refers to the form number.
22
taxes that are included on that form are federal
23
withholding, Social Security withholding, Medicare
24
withholding, employer match for both Social
Are you familiar with something known
Are you familiar with
I was hoping --
Tell me what 941 taxes are. The
Thomas Rankin
January 5, 2009
37 1
Security and Medicare.
2
Q.
3
taxes as you described them earlier?
4
A.
Yes.
5
Q.
To your knowledge, has there ever been
6
a tax assessment against State Street Consultants
7
for delinquency in payment of 941 taxes?
8
A.
Yes.
9
Q.
How many times has that occurred?
10
A.
Can you repeat the -- you're kind of
11
mixing the first question and the second question.
12
The first question?
13
Q.
14
knowledge, have there -- or has there ever been a
15
tax assessment against State Street Consultants
16
for delinquency in payment of 941 taxes?
17
answer was yes.
18
How many times has that occurred?
19
A.
Two.
20
Q.
When were those two instances of tax
21
assessments against State Street Consultants?
22
A.
I don't remember.
23
Q.
Has it been during calendar year 2008?
24
A.
I don't remember.
So it's all of the federal payroll
Yes.
The first question was:
To your
Your
And then my next question was:
Thomas Rankin
January 5, 2009
38 1
Q.
Was it during calendar year 2007?
2
A.
Don't remember when the assessment was
3
made.
4
Q.
5
within the past three years?
6
A.
Yes.
7
Q.
Has State Street Consultants yet paid
8
those taxes that it was delinquent in paying?
9
A.
Not that I'm aware of.
10
Q.
In addition to having the obligation to
11
pay those taxes, is it also going to be required
12
to pay interest on the amounts that it was
13
delinquent in paying?
14
A.
That hasn't been determined.
15
Q.
Is the assessment for the amount of the
16
tax that's due plus interest?
17
A.
Yes.
18
Q.
And is the assessment also inclusive of
19
some penalty?
20
A.
Yes.
21
Q.
Is State Street Consultants contesting
22
the assessment?
23
A.
No.
24
Q.
Do you know the total amount of the
Do you know at least that it's been
Thomas Rankin
January 5, 2009
39 1
assessment?
2
A.
I don't recall.
3
Q.
Do you know to what time periods it
4
relates?
5
A.
December 2006 through December 2007.
6
Q.
Do you know if the Internal Revenue
7
Service has issued a notice of a federal tax lien
8
on State Street Consultants?
9
A.
Yes.
10
Q.
Do you know if the Internal Revenue
11
Service has issued a federal tax lien against Neil
12
S. Clark?
13
A.
Yes.
14
Q.
Has it?
15
A.
Yes.
16 17
MR. CVETANOVICH: stickers.
18
Plaintiffs. - - - - -
19 20
We need some
Thereupon, Plaintiffs' Exhibit 2 is marked for purposes of identification.
21
- - - - -
22
Q.
23
document that's been marked Plaintiffs' Exhibit 2.
24
Mr. Rankin, I want to hand you a
MR. CVETANOVICH:
One for you, Bob.
Thomas Rankin
January 5, 2009
40 1
MR. BEHAL:
2
MR. CVETANOVICH:
Thank you, sir. You're welcome.
3
Q.
4
and look at it and see if you recognize it, and
5
then I'll perhaps have a couple of questions for
6
you about that.
7
this -- call your attention to the fact that this
8
is a two-sided exhibit.
9
bears a certification.
And I'll ask you to just take a minute
And let me -- lest I fail to do
The back of the exhibit And you can see what that
10
says there, but take a look and just tell me if
11
you recognize it.
12
A.
Yes.
13
Q.
Had a chance to look at that now, sir?
14
A.
Yes.
15
Q.
Do you recognize it?
16
A.
Yes.
17
Q.
Would you tell us for the record what
18
it is, please.
19
A.
Notice of federal tax lien.
20
Q.
And it is a notice of a lien against
21
what taxpayer?
22
MR. BEHAL:
23
itself.
24
A.
Objection.
Go ahead and answer. Neil S. Clark.
It speaks for
Thomas Rankin
January 5, 2009
41 1
Q.
2
delinquencies that you just described for us?
3
A.
Yes.
4
Q.
And does this reflect, over in the
5
right-hand column there where it says unpaid
6
balance of assessment, the amount that IRS is
7
claiming is -- is owed?
8
A.
Yes.
9
Q.
Does it also reflect in one of the
Does this relate to the 941 tax
10
columns there on the form the tax periods for
11
which the assessments relate or to which the
12
assessments relate?
13
A.
Yes.
14
Q.
Is it the case, Mr. Rankin, that during
15
the entire year of 2007 State Street Consultants
16
did not make any remittances of 941 taxes?
17
A.
I don't recall.
18
Q.
Isn't that what you would glean from
19
this form?
20
A.
21
they didn't make any payments.
22
reflected in there.
23
Q.
24
they made some payments, but this form reflects
It depends on what payroll is as to if
All right.
Payments could be
So you're saying perhaps
Thomas Rankin
January 5, 2009
42 1
that they were short, so to speak, in the payments
2
they made by the amounts reflected on the form,
3
correct?
4
A.
Yes.
5
Q.
Do you know if State Street Consultants
6
remitted any 941 taxes during 2007?
7
A.
I don't recall.
8
Q.
Are there documents that you could
9
consult which would tell you the answer to that
10
question?
11
A.
Yes.
12
Q.
What documents?
13
A.
Check register.
14
Q.
SSC's check register?
15
A.
Yes.
16
Q.
Is that an online check register?
17
A.
No.
18
Q.
It's just an old-fashioned checkbook?
19
A.
It's in the computer.
20
Q.
All right.
21
maintained tax register -- or check register?
22
Excuse me.
23
A.
Check register.
24
Q.
Yes?
So it's an electronically
Thomas Rankin
January 5, 2009
43 1
A.
Yes.
2
Q.
Who is the custodian of that?
3
A.
Ms. Harrison.
4
Q.
Do you have regular access to it?
5
A.
No.
6
Q.
Do you have access to State Street
7
Consultants' computerized financial records
8
system?
9
A.
No.
10
Q.
Are you familiar with what kind of
11
accounting software State Street Consultants uses?
12
A.
I'm not familiar with the system.
13
Q.
If you need access to information
14
that's maintained in that system, how do you go
15
about getting that?
16
A.
Request it of Ms. Harrison.
17
Q.
To your knowledge, does Ms. Harrison
18
have the authority to give you access to the
19
financial information of State Street Consultants?
20
A.
Yes.
21
Q.
Where are the offices of Thomas A.
22
Rankin & Associates housed?
23
A.
Two offices.
24
Q.
Where are they located?
Thomas Rankin
January 5, 2009
44 1
A.
2
and -- I think that's it about now.
3
Q.
4
you only gave me one address and then said, well,
5
you think that's about it now or that's it about
6
now.
7
A.
8
misspoke.
9
Q.
996 Poppy Hills Drive, Blacklick, Ohio,
Okay.
You said two offices, but then
Why did you give me that kind of an answer? I no longer have two offices.
All right.
I
Up until very recently you
10
did have two offices?
11
A.
Yes.
12
Q.
Poppy Hills Drive, Blacklick, Ohio,
13
what's the nature of the structure there that
14
houses your office at that address?
15
A.
What's the nature of the --
16
Q.
Structure.
17
A.
It's my residence.
18
Q.
So you have an office in your home?
19
A.
Yes.
20
Q.
And then in addition to that, at least
21
until recently, you had another office?
22
A.
Yes.
23
Q.
Was that at 137 East State Street?
24
A.
Yes.
Thomas Rankin
January 5, 2009
45 1
Q.
2
that location?
3
A.
When did you cease to have an office at
December 30th.
4
MR. BEHAL:
5
THE WITNESS:
No.
It's a Tuesday. It's a Tuesday?
December
6
27th?
7
Q.
2008?
8
A.
Yes.
9
Q.
Why did you close your office at 137
I don't recall exactly what date.
10
East State Street in late December of 2008?
11
A.
12
the premises.
13
Q.
14
Associates' office at 137 East State Street was
15
within the State Street Consultants office
16
complex?
17
A.
Yes.
18
Q.
Did Thomas A. Rankin & Associates lease
19
that space?
20
A.
No.
21
Q.
Under what kind of an arrangement did
22
Thomas A. Rankin & Co. occupy that space?
23
A.
24
services for State Street Consultants.
State Street Consultants was vacating
Is it the case that Thomas A. Rankin &
I was provided a facility to perform my
Thomas Rankin
January 5, 2009
46 1
Q.
2
Associates did not pay rent for that space?
3
A.
Yes.
4
Q.
How long did Thomas A. Rankin &
5
Associates occupy that space?
6
A.
2007.
7
Q.
So for all of 2007 and all of 2008, up
8
till the last couple of days?
9
A.
Yes.
10
Q.
On what floor of the building was the
11
space located that Thomas A. Rankin & Associates
12
occupied?
13
A.
Second floor.
14
Q.
Does Thomas A. Rankin & Associates
15
charge State Street Consultants fees for its
16
professional services?
17
A.
Not directly.
18
Q.
How does Thomas A. Rankin & Associates
19
receive payment for the professional services it
20
provides to State Street Consultants?
21
A.
22
Corporation.
23
Q.
24
retainer, monthly retainer?
Is it the case that Thomas A. Rankin &
Retainer through NSC Consulting
Is that an annual retainer, semi-annual Just how does that
Thomas Rankin
January 5, 2009
47 1
work?
2
A.
Quarterly retainer.
3
Q.
What is the quarterly amount of the
4
retainer?
5
A.
14,000.
6
Q.
So the -- as I understand what you've
7
told me, the professional services that Thomas A.
8
Rankin & Associates provides to State Street
9
Consultants are covered by a portion of that
10
quarterly retainer that Thomas A. Rankin &
11
Associates receives from NSC Consulting Corp.,
12
true?
13
A.
Yes.
14
Q.
Is payment for the professional
15
services that Thomas A. Rankin & Associates
16
provides to NSC Consulting group also covered by
17
that retainer?
18
A.
I'm sorry.
19
Q.
Sure.
20
A.
Please.
21
Q.
Is payment for the professional
22
services that Thomas A. Rankin & Associates
23
provides to NSC Consulting group also covered by
24
that retainer?
I was -- go ahead.
Sorry.
Thomas Rankin
January 5, 2009
48 1
A.
Yes.
2
Q.
Is the same true for the professional
3
services that Thomas A. Rankin & Associates
4
provides to State Street Partners?
5
A.
Yes.
6
Q.
Is the same true for the professional
7
services that Thomas A. Rankin & Associates
8
provides to Neil Clark?
9
A.
Yes.
10
Q.
Is NSC Consulting Corp. given a credit
11
against the quarterly retainer in the amount of
12
the value of the occupancy that Thomas A. Rankin &
13
Associates has had at 137 East State Street?
14 15
MR. BEHAL: meant to say, probably.
16 17
MR. CVETANOVICH:
MR. BEHAL: Q.
Okay.
Let me read the question again.
20 21
I actually did say
NSC.
18 19
NSC Consulting Corp. you
THE WITNESS:
She probably corrected
you.
22
MR. CVETANOVICH:
23
and pieces.
24
Q.
It came out in bits
No, she wouldn't do that. Let me read the question again.
Thomas Rankin
January 5, 2009
49 1
A.
Okay.
2
Q.
Is NSC Consulting Corp. given a credit
3
against the quarterly retainer in the amount of
4
the value of the occupancy that Thomas A. Rankin &
5
Associates has had at 137 East State Street?
6
A.
No.
7
Q.
Was the value of that occupancy of
8
space at 137 East State Street taken into account
9
when the quarterly retainer amount was negotiated?
10
A.
I don't remember.
11
Q.
For how long has the payment mechanic
12
to your firm for the services it provides to these
13
several entities been this quarterly retainer
14
arrangement?
15
A.
Quarterly retainer, 2007.
16
Q.
So for 2007 and 2008, the arrangement
17
has been what you've described?
18
A.
Uh-huh.
19
Q.
Yes?
20
Yes.
How was your firm paid for services to
21
these several entities back in 2006?
22
A.
Monthly retainer.
23
Q.
Did that retainer also come from NSC
24
Consulting Corp.?
Thomas Rankin
January 5, 2009
50 1
A.
Yes.
2
Q.
How much was the monthly amount back in
3
2006?
4
A.
I don't recall.
5
Q.
How much was the quarterly retainer in
6
2007?
7
A.
14,000.
8
Q.
And then it stayed the same in 2008?
9
A.
Yes.
10
Q.
Are you going to be occupying space in
11
State Street Consultants' new offices when they
12
move into new offices?
13
A.
No.
14
Q.
At that point will you work -- saying
15
you, now, I mean Thomas A. Rankin & Associates,
16
work only from the office you maintain in your
17
home?
18
A.
I don't know.
19
Q.
What is your near-term plan for the
20
space you will occupy when you are performing the
21
services that you provide to NSC, SSC, and SSP?
22
A.
Can you ask that again?
23
Q.
Yes.
24
I'm sorry.
Let me come at it this way.
You've indicated to me that for some
Thomas Rankin
January 5, 2009
51 1
time now Thomas A. Rankin & Associates has
2
occupied space at 137 East State Street to
3
facilitate it providing services to NSC Consulting
4
Corp., State Street Consultants, State Street
5
Partners, and -- and even Mr. Clark.
6
indicated to me that you've now moved out of 137
7
East State Street.
8
the near term, where, physically where, will
9
Thomas A. Rankin & Associates reside as it
My question is:
You've also
At least for
10
provides professional services to NSC, SSC, SSP,
11
and Mr. Clark?
12
A.
996 Poppy Hills.
13
Q.
Do you know for how long that state of
14
affairs will continue or is projected to continue?
15
A.
No.
16
Q.
Do you have an understanding of where
17
State Street Consultants is relocating its
18
offices?
19
A.
Yes.
20
Q.
Where is that going to be?
21
A.
49 South Grant Street, Columbus.
22
Q.
Do you know when that will be
23
effective?
24
A.
No.
Thomas Rankin
January 5, 2009
52 1
Q.
2
space now, to your knowledge?
3
A.
Yes.
4
Q.
Do you know for how long State Street
5
Consultants is planning to occupy that space?
6
A.
No.
7
Q.
Do you know if there is a plan that at
8
a point State Street Consultants will relocate its
9
professional offices?
10
A.
11
Is State Street Consultants in that
No. MR. BEHAL:
Was the question does he
12
know whether State Street Consultants is going to
13
relocate, is that what the question was?
14
sorry.
15
Q.
16
is a plan --
17
The question was:
MR. BEHAL:
I'm
Do you know if there
Okay.
18
Q.
19
Consultants will relocate its professional
20
offices?
-- that at a point State Street
21
MR. BEHAL:
22
MR. CVETANOVICH:
23
MR. BEHAL:
24
is a plan.
So the answer is no -The answer was "no."
-- you do not know if there
Thomas Rankin
January 5, 2009
53 1
THE WITNESS:
2
MR. BEHAL:
No. Okay.
Thank you.
I just
3
want to make sure I --
4
Q.
5
office at Thomas A. Rankin & Associates at some as
6
yet undetermined point in the future?
7
A.
I don't have a plan.
8
Q.
Have you had any discussions with
9
Mr. Clark or anyone else at State Street
Do you have a plan for opening another
10
Consultants about there coming a time or there
11
coming a point when you will again have office
12
space together with State Street Consultants?
13
A.
No.
14
Q.
Have you had a discussion with
15
Mr. Clark about the prospect of him winding up or
16
terminating the business of State Street
17
Consultants?
18
A.
Yes.
19
Q.
To your knowledge, does he have a plan
20
of winding up or terminating the business of State
21
Street Consultants?
22
A.
No.
23
Q.
Has Mr. Clark discussed with you a plan
24
that he has or an idea that he has for starting a
Thomas Rankin
January 5, 2009
54 1
new entity through which to conduct his lobbying
2
business?
3
A.
4
sorry.
5
Q.
Certainly.
6
A.
Thank you.
7
Q.
Has Mr. Clark discussed with you a plan
8
that he has or an idea that he has for starting a
9
new entity through which to conduct his lobbying
Can you repeat the question?
I'm
10
business?
11
A.
No.
12
Q.
Has Mr. Clark discussed with you a plan
13
that he has or an idea that he has for moving the
14
lobbying that he personally does out of State
15
Street Consultants into NSC Consulting Corp.?
16
A.
No.
17
Q.
Has he discussed with you a plan that
18
he has or an idea that he has for himself doing
19
lobbying work through some entity other than State
20
Street Consultants?
21
A.
Yes.
22
Q.
What discussions have you had with
23
Mr. Clark about that?
24
MR. BEHAL:
I'm going to object on the
Thomas Rankin
January 5, 2009
55 1
grounds of relevancy.
2
Q.
You may respond.
3
A.
I don't recall exactly the discussion.
4
Q.
Tell me as much as you can recall.
5
A.
I recall -- I recall Neil discussing
6
the possibility of working as a lobbyist outside
7
of State Street Consultants.
8
Q.
Do you recall any more than that?
9
A.
I recall Neil stating he would not be a
10
tenant of State Street Partners, if that's
11
relevant to that.
12
Q.
What else can you recall?
13
A.
Can't recall much right now.
14
Q.
When did you and Mr. Clark discuss
15
that?
16
A.
I don't remember exactly.
17
Q.
Was it in 2008?
18
A.
Yes.
19
Q.
The latter half of 2008?
20
A.
Yes.
21
Q.
The last quarter of 2008?
22
A.
Yes.
23
Q.
Within the past month?
24
A.
Yes.
Thomas Rankin
January 5, 2009
56 1
Q.
2
discussed that subject matter within the last
3
month?
4
A.
I don't recall.
5
Q.
More than once?
6
A.
Yes.
7
Q.
As many as five times?
8
A.
Maybe.
9
Q.
Has anybody else been a party to any of
How many times have you and Mr. Clark
10
those discussions between you and Mr. Clark?
11
A.
Yes.
12
Q.
Who else?
13
A.
Bob Behal.
14
Q.
Anyone else?
15
A.
Andrew Minton.
16
Q.
Anyone else?
17
A.
Not that I recall.
18
Q.
Have those discussions all been in
19
person?
20
A.
No.
21
Q.
Some in person?
22
A.
Yes.
23
Q.
Where did those occur?
24
A.
Easton Starbucks.
Thomas Rankin
January 5, 2009
57 1
Q.
2
there been multiple discussions in person?
3
A.
More than one.
4
Q.
How many?
5
A.
Don't recall exactly.
6
Q.
Was that between you and Mr. Clark?
7
A.
No.
8
Q.
Who was in attendance at those Easton
9
Starbucks discussions?
Is that a single discussion, or have
10
A.
Andrew Minton.
11
Q.
Excuse me.
12
and you?
13
A.
Yes.
14
Q.
Anyone else at the in-person
15
discussions at Starbucks?
16
A.
No.
17
Q.
Have there been any in-person
18
discussions other than those at the Easton
19
Starbucks?
20
A.
Not that I can recall.
21
Q.
The discussions you've had that have
22
not been in person, I take it were telephonic.
23
that correct?
24
A.
Yes.
Lisa Rankin.
Andrew Minton, Lisa Rankin
Is
Thomas Rankin
January 5, 2009
58 1
Q.
2
there been?
3
A.
Don't recall exactly.
4
Q.
Have those been two-person telephone
5
discussions or multiple-person telephone
6
discussions?
7
A.
Both.
8
Q.
The two-person discussions were between
9
you and what other person?
How many of those discussions have
10
A.
Neil Clark.
11
Q.
How many of those have there been?
12
A.
Several.
13
Q.
Several being what, more than three?
14
A.
It would be a guess.
15
Q.
When you say several, what do you
16
typically intend to connote by your --
17
A.
Three.
18
Q.
-- your use of that term?
19
A.
Sure.
20
Q.
When there have been more than you and
21
Mr. Clark on the phone, who else has been on the
22
call?
23
A.
Bob Behal.
24
Q.
How many of those have there been?
Three?
Thomas Rankin
January 5, 2009
59 1
A.
A couple.
2
Q.
Have there been any other discussions
3
within the past month on this subject matter that
4
have occurred but that you have not been
5
referencing in the discussion we just had of
6
telephone calls and Easton Starbucks meetings?
7
A.
Not that I recall.
8
Q.
Apart from the discussions, whether in
9
person or telephonic, have there been e-mail
10
communications between you and anyone else
11
regarding this topic?
12
A.
Not that I remember.
13
Q.
Have there been text messages or
14
instant messages between you and anyone else on
15
this subject matter?
16
A.
Yes.
17
Q.
Tell me with whom you have
18
text-messaged, if that's a phrase, or
19
instant-messaged.
20
A.
Neil Clark.
21
Q.
Anyone else?
22
A.
Not that I remember.
23
Q.
Have they been instant messages or text
24
messages?
Thomas Rankin
January 5, 2009
60 1
A.
Are they not the same?
2
Q.
I think the teenagers would tell us no,
3
they're not the same.
4
AOL vehicle where you can be sitting at a computer
5
and interacting in real time with someone on
6
another computer.
7
A.
Text.
8
Q.
Okay.
9
A.
Right.
10
Q.
All right.
11
you've text-messaged with Mr. Clark on this
12
subject matter?
13
A.
I don't recall.
14
Q.
Did you save any of the text messages?
15
A.
No.
16
Q.
You think you've deleted them?
17
A.
Yes.
18
Q.
I would ask you if any of those remain
19
on your telephone to not delete them.
20
consult with Mr. Weaver about that, but I would
21
ask that you not do that.
22
any e-mails dealing with that subject matter or
23
written documentation, whether it be
24
communications you received from others or notes
Instant message is the old
Text is over the telephone.
You recall how many times
You can
Similarly, if you have
Thomas Rankin
January 5, 2009
61 1
you made to yourself, please do not destroy,
2
delete, or anything like that.
3
Mr. Weaver can talk with you about that.
4
A.
Okay.
5
Q.
Thank you.
6
the Starbucks -- Easton Starbucks meeting Andrew
7
Minton and Lisa Rankin were in attendance with
8
you.
9
A.
A lobbyist at State Street Consultants.
10
Q.
Who is Lisa Rankin?
11
A.
My spouse.
12
Q.
How long have you and Lisa been
13
married?
14
A.
15
Eight years, almost.
16
Q.
17
front of her, by the way.
18
guy.
19
A.
I appreciate that.
20
Q.
Does Lisa Rankin also work for State
21
Street Consultants?
22
A.
No.
23
Q.
Has she ever?
24
A.
Yes.
And again,
You indicated to me that in
Who is Andrew Minton?
Better not wait too long on this one.
I would never ask you that question in I wouldn't do that to a
Thomas Rankin
January 5, 2009
62 1
Q.
During what time frame?
2
A.
2006 to 2008.
3
Q.
When did she cease working for State
4
Street Consultants?
5
A.
2008.
6
Q.
What part of the year?
7
A.
August, I think.
8
Q.
What was her job at State Street
9
Consultants?
10
A.
Lobbyist.
11
Q.
Is that the position she held there
12
throughout her tenure with State Street
13
Consultants?
14
A.
Yes.
15
Q.
You said that her employment there
16
commenced in 2006.
17
the year 2006?
18
A.
I don't recall.
19
Q.
Was your spouse a full-time employee of
20
State Street Consultants during the period that
21
she worked there?
22
A.
Yes.
23
Q.
Has your spouse ever been an employee
24
of State Street Partners?
Was that at the beginning of
Thomas Rankin
January 5, 2009
63 1
A.
Not that I'm aware of.
2
Q.
Has your spouse ever been an employee
3
of NSC Consulting Corp.?
4
A.
Yes.
5
Q.
During what time frame?
6
A.
1987 through 2006.
7
Q.
Is it the case, Mr. Rankin, that she
8
ceased to be an employee of NSC Consulting group
9
before she became an employee of State Street
10
Consultants?
11
A.
Yes.
12
Q.
Was it a situation in which it was at
13
the same point in time when she ceased to be
14
employed with NSC Consulting group but then became
15
employed by State Street Consultants?
16
A.
Yes.
17
Q.
To your knowledge, did Lisa Rankin at
18
any time after January 1st, 2006, provide services
19
to clients of NSC Consulting group?
20
A.
Yes.
21
Q.
Was that done on a regular basis?
22
A.
Yes.
23
Q.
To your knowledge, was it also the case
24
that other lobbyists, meaning other than Lisa
Thomas Rankin
January 5, 2009
64 1
Rankin, with State Street Consultants from January
2
1st, 2006 to the present, provided services to
3
clients of NSC Consulting Corp.?
4
A.
I don't know.
5
Q.
So you know that Lisa did, but you're
6
not sure if others did?
7
A.
Yes.
8
Q.
How do you know that Lisa did?
9
A.
She represented the nurses association.
10
Q.
And you know that to be a client of NSC
11
Consulting Corp.?
12
A.
Yes.
13
Q.
How do you know that?
14
MR. WEAVER:
I'm going to object to
15
your -- and raise spousal privilege with respect
16
to anything that Mr. Rankin's spouse has told him
17
without an non-necessary party present.
18
ask Dan if you'll pose his questions with respect
19
to his knowledge as the accountant for the
20
different entities.
21
MR. CVETANOVICH:
And I'll
Well, I'll go some of
22
that way, Mark.
23
questions in terms of knowledge from any source
24
other than Lisa.
What I'll do is pose the
Thomas Rankin
January 5, 2009
65 1
MR. WEAVER:
2
MR. CVETANOVICH:
3
MR. WEAVER:
4
MR. CVETANOVICH:
That's fine. Fair enough?
Yes.
Thank you. All right.
Sure.
5
Q.
6
Mr. Rankin.
7
A.
I'm easily confused.
8
Q.
Pardon me?
9
A.
I'm easily confused.
10
Q.
Well, I know Mr. Weaver can easily
11
straighten you out, too, so --
12
I hope all that didn't confuse you,
Before Mr. Weaver and I had our little
13
interchange, you indicated to me that you knew
14
that Lisa represented the nurses association.
15
question to you now is, do you know that from any
16
source other than Lisa telling you that?
17
A.
No.
18
Q.
Is that information reflected in the
19
books and records of State Street Consultants that
20
you see?
21
A.
22
talking about?
23
Q.
24
services to the nurses association.
My
What piece of information are you
That Lisa Rankin provides or provided
Thomas Rankin
January 5, 2009
66 1
A.
2
NSC.
3
Q.
4
Street Consultants?
5
A.
No.
6
Q.
Do you regularly see cash flow
7
statements of State Street Consultants?
8
A.
Yes.
9
Q.
Who prepares them?
10
A.
Ms. Harrison.
11
Q.
Do you play any role in the preparation
12
of the cash flow statements?
13
A.
No.
14
Q.
Does anyone other than Ms. Harrison, to
15
your knowledge, participate in the preparation of
16
the cash flow statements?
17
A.
18
that she incorporates into the cash flow.
19
Q.
20
Street Consultants' cash flow statements?
21
A.
Yes.
22
Q.
Why is NSC Consulting Corp. information
23
incorporated into State Street Consultants' cash
24
flow statements?
It is not in the books and records of
Is it in the books and records of State
I give Ms. Harrison NSC information
That she incorporates into the State
Thomas Rankin
January 5, 2009
67 1
A.
I don't know.
2
Q.
Who made a determination that it would
3
be done that way?
4
A.
I don't know.
5
Q.
To your knowledge, during the time that
6
you've had a relationship with State Street
7
Consultants, has it ever had an accountant on its
8
payroll?
9
A.
To my knowledge, no.
10
Q.
Ms. Harrison is a trained bookkeeper,
11
correct?
12
A.
13
training.
14
Q.
15
accounting or bookkeeping questions?
16
A.
No.
17
Q.
Do you know to whom Ms. Harrison turns
18
if she has accounting or bookkeeping questions in
19
connection with her performance of her job duties
20
for State Street Consultants?
21
A.
22 23 24
I don't know what she is, as far as
Does Ms. Harrison ever come to you with
I don't know. - - - - Thereupon, Plaintiffs' Exhibit 3 marked
for purposes of identification.
Thomas Rankin
January 5, 2009
68 1
- - - - -
2
Q.
3
document that is being marked Plaintiffs' Exhibit
4
3.
5
that, if you would, please.
Mr. Rankin, I now want to hand you a
I'll ask you to take a moment and look at
6
MR. WEAVER:
7
MR. CVETANOVICH:
8
MR. WEAVER:
9
Dan, is there is a 1?
Is that a previous
deposition?
10
MR. CVETANOVICH:
11
MR. WEAVER:
12
MR. CVETANOVICH:
13
MR. WEAVER:
Yeah, I'm just doing
No, that's all right.
MR. CVETANOVICH:
I
Be happy to get you a
copy.
18 19
Thank you.
just want to make sure I'm not missing any.
16 17
It was.
them all in sequence.
14 15
Yes.
MR. WEAVER: paper.
20
No, I've got plenty of
Thank you. MR. CVETANOVICH:
21
BY MR. CVETANOVICH:
22
Q.
23
Exhibit 3 --
24
A.
Yeah, don't we all.
Have you had a chance to take a look at
Yes.
Thomas Rankin
January 5, 2009
69 1
Q.
-- Mr. Rankin?
2
A.
Yes.
3
Q.
Before we get too deeply into that, let
4
me ask you, are you aware of one or more instances
5
when the Internal Revenue Service has issued a tax
6
assessment against Neil Clark individually?
7
A.
Yes.
8
Q.
Are you aware of the Internal Revenue
9
Service having issued a notice of a federal tax
10
lien against Mr. Clark individually?
11
A.
Yes.
12
Q.
I've handed you Exhibit 3, and you've
13
had a chance to take a look at it.
14
further with that, just let me note for the
15
record, so it is a matter of record, that this is
16
also a two-sided exhibit.
17
there's a certification on the back.
18
Before we go
So just note that
With that, can you identify for the
19
record, please, what Exhibit 3 is?
20
A.
21
Notice -MR. BEHAL:
Objection.
It speaks for
22
itself.
23
A.
Notice of federal tax lien.
24
Q.
Who is the taxpayer that is the subject
Go ahead and answer.
Thomas Rankin
January 5, 2009
70 1
of this notice?
2
A.
Neil S. Clark.
3
Q.
Had you seen this before today?
4
A.
Yes.
5
Q.
This reflects that the IRS is taking
6
the position that Mr. Clark has an unpaid balance
7
of a tax assessment against him for calendar year
8
or tax year 2006, $749,561.17.
9
A.
Yes.
10
Q.
Is Mr. Clark contesting that?
11
A.
No.
12
Q.
Has he yet paid any part of that unpaid
13
balance that's noted on the exhibit?
14
A.
I'm not aware of it.
15
Q.
Given your relationship with him, would
16
you expect that you would be aware of it if he had
17
made such payments?
18
A.
Yes.
19
Q.
This notice also indicates that
20
Mr. Clark had an unpaid balance on the assessment
21
for tax year 2007 in the amount of $321,454.38.
22
Correct?
23
A.
Yes.
24
Q.
Do you know if Mr. Clark has to date
Correct?
Thomas Rankin
January 5, 2009
71 1
paid any part of that unpaid balance?
2
A.
Not that I'm aware of.
3
Q.
I think we can set that one aside.
4 5
MR. WEAVER:
You need a bathroom break,
Tom?
6
THE WITNESS:
7
MR. CVETANOVICH:
8
THE VIDEOGRAPHER:
9
I'm sorry.
I gotta go.
Oh, sure. We are off the
record at 11:59.
10
(A brief recess is taken.)
11
THE VIDEOGRAPHER:
We are back on the
12
record at 12:13.
13
Q.
14
proceeding today I had asked you about what space
15
within the facility at 137 East State Street
16
Thomas A. Rankin & Associates occupied, and you
17
told me it was on the second floor.
18
to you now is:
19
A. Rankin & Associates occupied space on the first
20
floor of that building?
21
A.
Yes.
22
Q.
Can you tell me in what time frame your
23
firm occupied space on the first floor of that
24
building?
Mr. Rankin, at an earlier point in our
My question
Was there ever a time when Thomas
Thomas Rankin
January 5, 2009
72 1
A.
2004 through 2006.
2
Q.
Was that through the beginning of 2006,
3
or at some point later in the year in 2006?
4
A.
The beginning.
5
Q.
During the period when Thomas A. Rankin
6
& Associates occupied space on the first floor of
7
that building, did it pay rent?
8
A.
Yes.
9
Q.
Was its rent payments to State Street
10
Partners?
11
A.
Yes.
12
Q.
How did it come about that Thomas A.
13
Rankin & Associates moved from the first floor of
14
the building to the second floor of the building
15
and then stopped paying rent?
16
A.
17
space, the office that I was in -- let me rephrase
18
that.
19
Q.
Please.
20
A.
State Street Partners was attempting to
21
rent the first floor of the building to anyone
22
interested.
23
was a -- a dual office.
24
office was marketable and to someone who could use
The ability to rent the first floor
The office I had on the first floor They thought that that
Thomas Rankin
January 5, 2009
73 1
that space and possibly more offices, more office
2
space on the first floor.
3
upstairs to make that office or that additional
4
space available.
5
Q.
6
then able to occupy space in the building, albeit
7
on the second floor, at no rent?
8
A.
I don't know.
9
Q.
Who communicated to you that you would
So I guess -- I moved
And how did it come about that you were
10
no longer have to pay rent to occupy space in the
11
building?
12
A.
Neil Clark.
13
Q.
What did he say to you?
14
A.
"Move upstairs, it's more convenient
15
for you to be upstairs."
16
Q.
17
it?
18
A.
I would assume.
19
Q.
Did he say why?
20
A.
No.
21
Q.
Did he ask you if that would be okay
22
with you?
23
A.
Yes.
24
Q.
It was okay with you, wasn't it?
That's about it.
He added there would be no rent, I take
Thomas Rankin
January 5, 2009
74 1
A.
It was okay.
2
Q.
How much had Thomas A. Rankin &
3
Associates been paying in rent up to that point in
4
time when it moved up to the second floor?
5
A.
Maybe 1500 a month.
6
Q.
Since Thomas A. Rankin & Associates
7
moved its offices to the second floor of 137 East
8
State Street, have you personally had a key to the
9
office building?
10
A.
Yes.
11
Q.
Have you had a key or a pass card or
12
something that would give you the ability to gain
13
access to the second floor of that building?
14
A.
Yes.
15
Q.
What did it take or does it take to
16
gain access to the second floor of the building?
17
A.
To gain access to the second floor?
18
Q.
Yes, sir.
19
A.
During business hours, walk up the
20
steps.
21
Q.
22
what security there is for the offices of State
23
Street Consultants.
24
locked doors, and it requires a key or it requires
I'm not sure I understand your question. Well, I'm just trying to understand
You know, many offices have
Thomas Rankin
January 5, 2009
75 1
a pass card or it requires knowing a code that one
2
has to punch in little buttons to get in.
3
just trying to understand what was the arrangement
4
there with the offices of State Street
5
Consultants.
6
A.
7
pass code to the back door.
8
Q.
9
up to the offices of State Street Consultants?
And I'm
All occupants of the building had a
Could all occupants of the building get
10
A.
No.
11
Q.
What else was required for access to
12
the second floor?
13
A.
During business hours, nothing.
14
Q.
How about outside of business hours?
15
A.
A security code for the second floor
16
alarm.
17
Q.
18
say:
19
access to the second floor during the past three
20
years?
21
A.
Yes.
22
Q.
Are there old-fashioned keys required
23
to gain access to any part of the building over
24
there?
Was -- let me take that word back and Were you provided the security code to gain
Thomas Rankin
January 5, 2009
76 1
A.
Yes.
2
Q.
For what parts of the building does one
3
need a key to gain access?
4
A.
5
have keys.
6
Q.
Any other parts of the building?
7
A.
No.
8
Q.
Did you have a key to the basement?
9
A.
No.
10
Q.
Did you have a key to any of the
11
interior doors throughout the office complex?
12
A.
Did I or do I?
13
Q.
Well, let's start with do you.
14
A.
Yes.
15
Q.
Since you moved out of the building
16
here in the past couple of weeks, whenever it's
17
been, you haven't yet turned in your keys?
18
A.
19
building.
20
Q.
21
that yet; is that correct?
22
A.
Yes.
23
Q.
Is there a point in time when you need
24
to get it out of there?
To go to the basement.
Interior doors
I have additional furniture inside the
So you haven't had a chance to move
Thomas Rankin
January 5, 2009
77 1
A.
Yes.
2
Q.
What is that point in time?
3
A.
When it's convenient for State Street
4
Partners to get me access where I can send people
5
to --
6
I'd like to.
MR. WEAVER:
I was going to discuss
7
that with you today, Dan.
8
A.
9
-- move the furniture. MR. CVETANOVICH:
Why don't we do that
10
in a little bit.
11
Q.
12
You've still got a key so that when the time is
13
right you can gain access to the offices to get
14
your furniture; is that correct?
15
A.
Yes.
16
Q.
When you vacated the building, apart
17
from getting the furniture out that's still there,
18
did anyone ask you to return the key that you have
19
to the building?
20
A.
No.
21
Q.
What part of the building are you
22
permitted access through use of this key?
23
A.
The key to my door?
24
Q.
Well, that may be the answer to the
So you've got some furniture there.
Thomas Rankin
January 5, 2009
78 1
question.
2
A.
Okay.
3
Q.
You said that keys were required to get
4
to the basement and for some interior door.
5
A.
Yes.
6
Q.
Doors, plural.
7
a key.
8
you have opens.
9
A.
To my interior door.
10
Q.
Do you know whether since Thomas A.
11
Rankin & Associates moved its operation out of 137
12
East State Street the codes have been changed to
13
permit you to gain access to the building and to
14
the second floor of the building?
15
A.
Am I aware of that?
16
Q.
Yes, sir.
17
A.
I am not aware of that.
18
Q.
Do you know whether the codes have been
19
changed for one to gain access to the building and
20
then to the second floor of the building since
21
State Street Consultants moved its operations out
22
of the building?
23
A.
I'm not aware of it.
24
Q.
Do you know if State Street
You've said you've got
I'm just trying to understand what the key
Thomas Rankin
January 5, 2009
79 1
Consultants' move of its operations from that
2
building is yet complete?
3
A.
I don't know.
4
Q.
Do you know that the move has at least
5
started?
6
A.
Yes.
7
Q.
Do you know if any State Street
8
Consultants personnel are yet occupying space at
9
49 South Grant Street?
10
A.
I don't know.
11
Q.
Do you know whether there is a timeline
12
in place for that move to be completed?
13
A.
I don't.
14
Q.
Do you know if there are any employees
15
of State Street Consultants who will be performing
16
their duties of employment from locations other
17
than 49 South Grant Street?
18
A.
I don't know where they will work from.
19
Q.
Have you heard anyone discuss where the
20
various employees of State Street Consultants will
21
be working from?
22
A.
I've heard.
23
Q.
Tell me what you've heard.
24
A.
Home or 49 South Grant street or the
Thomas Rankin
January 5, 2009
80 1
Statehouse.
2
Q.
3
Street Consultants have you heard will be
4
performing their services from 49 South Grant
5
Street?
6
A.
I don't know.
7
Q.
Do you know any of them?
8
A.
I don't know where they will be working
9
from.
I think that's it. All right.
Which employees of State
10
Q.
11
working from 49 South Grant Street?
12
A.
Yes.
13
Q.
Which ones?
14
A.
I don't know specifically all -- which
15
ones.
16
Q.
Haven't heard any names?
17
A.
No.
18
Q.
Which employees of State Street
19
Consultants have you heard will be performing
20
services from their homes?
21
A.
22
Have you heard that any of them will be
Andrew Minton. MR. BEHAL:
Objection.
Go ahead.
23
Q.
You may respond.
24
A.
Andrew Minton, John Singleton, Penny
Thomas Rankin
January 5, 2009
81 1
Tipps, Aaron Ockerman.
2
Q.
Any others?
3
A.
Jane Harrison.
4
Q.
Any others?
5
A.
That's all I recall.
6
Q.
Andrew Minton is a lobbyist, correct?
7
A.
Yes.
8
Q.
Penny Tipps is also a lobbyist,
9
correct?
10
A.
Yes.
11
Q.
What is John Singleton's position at
12
State Street Consultants?
13
A.
Lobbyist.
14
Q.
What is Aaron Ockerman's position at
15
State Street Consultants?
16
A.
Lobbyist.
17
Q.
Do you know where Andrew Minton lives?
18
A.
No.
19
Q.
Do you know where John Singleton lives?
20
A.
No.
21
Q.
Do you know where Penny Tipps lives?
22
A.
Yes.
23
Q.
Where does Penny Tipps live?
24
A.
Westerville.
Thomas Rankin
January 5, 2009
82 1
Q.
Do you know where Aaron Ockerman lives?
2
A.
No.
3
Q.
Do you know for how long it is planned
4
that Mr. Minton, Mr. Singleton, Ms. Tipps, and
5
Mr. Ockerman will work from their homes?
6
MR. BEHAL:
7
whom?
8
Q.
9
bit.
10
Objection.
Planned by
Let me change the question a little
What we're talking about now -- what
11
I'm asking you about now is what you have heard.
12
Have you heard for how long Mr. Minton will be
13
performing his services for SSC from his home?
14
A.
I have not heard.
15
Q.
Have you heard for how long
16
Mr. Singleton will be working from his home?
17
A.
I have not heard.
18
Q.
Have you heard for how long Ms. Tipps
19
will be working from her home?
20
A.
I have not heard.
21
Q.
Have you heard for how long
22
Mr. Ockerman will be working from his home?
23
A.
I have not heard.
24
Q.
Do you know if there is in existence a
Thomas Rankin
January 5, 2009
83 1
plan for when these people will cease to work from
2
their homes?
3 4
MR. BEHAL: Q.
5 6
You may respond. MR. WEAVER:
I'm sorry.
What was the
basis?
7 8
Objection.
MR. BEHAL:
On the basis that I'm not
sure whose plan or what plan he's referring to.
9
MR. WEAVER:
So it's as to form?
10
MR. BEHAL:
11
MR. WEAVER:
12
want to make sure he understands.
13
It is. Can you rephrase?
MR. CVETANOVICH:
I just
Sure.
14
BY MR. CVETANOVICH:
15
Q.
16
you have any awareness of any plan formulated by
17
anyone for the duration for Mr. Minton,
18
Mr. Singleton, Ms. Tipps, and Mr. Ockerman to
19
continue working from their homes.
I'm just trying to understand whether
20
MR. BEHAL:
21
MR. WEAVER:
22
answer.
23
A.
24
work from their homes.
Objection. If you understand, you can
I don't know how long they're going to
Thomas Rankin
January 5, 2009
84 1
Q.
2
would be working from their homes?
3
A.
It was in the paper.
4
Q.
Did you learn it from any other source?
5
A.
I don't know where they would work
6
from.
7
Q.
8
any of these individuals working from their homes
9
is from the newspaper?
How did you learn that these people
So the only information you have about
10
A.
No.
11
Q.
What other sources of information do
12
you have for the proposition that these people
13
will be working from their homes?
14
A.
Discussion.
15
Q.
With whom?
16
A.
Andrew Minton.
17
Q.
Anyone else?
18
A.
No.
19
Q.
What did Mr. Minton tell you?
20
A.
I don't recall.
21
Q.
Is he the one who told you that he,
22
Mr. Singleton, Ms. Tipps and Mr. Ockerman would be
23
working from their homes, at least for a time?
24
A.
I don't recall who exactly told me
Thomas Rankin
January 5, 2009
85 1
that.
2
Q.
3
you that?
4
A.
Possibly.
5
Q.
You just don't know?
6
A.
Possibly.
7
Q.
Can you tell me anyone else who
8
communicated that information to you or part of
9
that information to you?
Did anyone other than Mr. Minton tell
10
A.
Neil Clark.
11
Q.
Anyone else?
12
A.
No.
13
Q.
What did Mr. Clark tell you about that?
14
A.
I don't specifically remember.
15
Q.
When did you speak with Mr. Clark about
16
that?
17
A.
I don't know.
18
Q.
Where were you when you and Mr. Clark
19
spoke about that?
20
A.
I don't know.
21
Q.
Did you and he speak in person?
22
A.
I don't know if it was in person.
23
Q.
Did Mr. Clark communicate to you that
24
this would be a temporary arrangement, meaning the
Thomas Rankin
January 5, 2009
86 1
arrangement whereby some of these people would be
2
working from their homes?
3
A.
Can you re-ask that, please.
4
Q.
Yes.
5
did he communicate to you that the arrangement
6
whereby Andrew Minton, John Singleton, Penny Tipps
7
and Aaron Ockerman would work from their homes was
8
to be a temporary arrangement?
9
A.
No.
10
Q.
When you spoke with Mr. Minton about
11
this arrangement that has these people working
12
from their homes, did he give you any indication
13
of how long that arrangement would last?
14
A.
No.
15
Q.
Does State Street Consultants have
16
lobbyists other than Mr. Minton, Mr. Singleton,
17
Mr. Tipps and --
18
When you spoke with Mr. Clark,
MR. BEHAL:
Ms. Tipps. Ms. Tipps and Mr. Ockerman?
19
Q.
Excuse me.
20
A.
Neil Clark.
21
Q.
Any others?
22
A.
No.
23
Q.
Is Mr. Clark going to be working from
24
his home, to your knowledge?
Thomas Rankin
January 5, 2009
87 1
A.
I don't know.
2
Q.
Have you heard it stated that he will
3
be working from 49 South Grant Street?
4
A.
Yes.
5
Q.
By whom?
6
A.
Mr. Clark.
7
Q.
Was that in the same conversation when
8
he told you others would be working from their
9
homes?
10
A.
11
conversation.
12
Q.
13
State Street Consultants employees who would be
14
working from 49 South State Street?
15 16
I don't recall the specific
Did he tell you the names of any other
MR. WEAVER:
Pardon me.
Do you mean
Grant Street?
17
MR. CVETANOVICH:
I do.
Thank you.
18
Let me restate the question.
19
my head here.
20
Q.
21
tell you the name of any other State Street
22
Consultants employees who will be working from 49
23
South Grant Street?
24
A.
Too many streets in
Did Mr. Clark, when you spoke with him,
They all have the ability to work from
Thomas Rankin
January 5, 2009
88 1
49 -- whatever that street is.
2
MR. BEHAL:
Grant.
3
A.
Grant Street.
4
Q.
You learned that from Mr. Clark?
5
A.
Yes.
6
Q.
Do you know what will be the nature of
7
the space that State Street Consultants will
8
occupy at 49 South Grant?
9
A.
A building.
10
Q.
Let me ask a little better question.
11
And I appreciate that, but let me ask a little
12
better question.
13
Do you know for what uses the space
14
that State Street Consultants will occupy in that
15
building will be set up?
16
A.
I still don't understand.
17
Q.
In other words, is it all going to be
18
conference space, meeting rooms, private offices,
19
a roller rink --
20
A.
Office space.
21
Q.
Private offices, is that your
22
understanding?
23
A.
24
private offices.
I'm sorry.
There are -- from what I understand,
Thomas Rankin
January 5, 2009
89 1
Q.
Also meeting space?
2
A.
From what I understand.
3
Q.
To your knowledge, will there be enough
4
private offices to house all the lobbyists?
5
A.
I don't know.
6
Q.
Do you know how many private offices
7
will be set up in the office space that State
8
Street Consultants occupies at 41 South Grant?
9
Excuse me.
49 South Grant.
10
A.
I don't.
11
Q.
You said to me probably 15 minutes ago,
12
Mr. Rankin, that some of State Street Consultants'
13
employees would be working from 49 South Grant,
14
some would be working from their homes, some would
15
be working from the Statehouse.
16
Street Consultants' employees do you understand
17
will be working from the Statehouse?
18
A.
19
services at the Statehouse.
20
Q.
21
Street Consultants who under this new arrangement
22
will be performing work duties only at the
23
Statehouse?
24
A.
Which of State
I presume they all will perform
Do you know of any employee of State
No.
Thomas Rankin
January 5, 2009
90 1
Q.
2
Consultants who you have been made to understand
3
will be working out of his or her home whose name
4
you have not already provided me?
5
A.
I don't know.
6
Q.
We spoke quite a bit earlier in our
7
proceeding today about the nature of the services
8
that your firm provides for State Street
9
Consultants.
Is there any employee of State Street
I want to ask a similar question
10
about the services that your firm provides for
11
other entities, and we'll just take the other
12
entities one by one.
13
Let's first talk about State Street
14
Partners.
15
services that Thomas A. Rankin & Associates
16
provides for State Street Partners.
17
A.
Tax compliance and bookkeeping.
18
Q.
Anything else?
19
A.
No.
20
Q.
I want to make sure --
21
A.
I'm going to --
22
Q.
Go ahead.
23
A.
I have talked with the bank, with the
24
lending institution, with reference to the
Can you describe for me, please, the
Thomas Rankin
January 5, 2009
91 1
mortgage on the building.
2
Q.
Anything else?
3
A.
No.
4
Q.
When you used the phrase "tax
5
compliance" in reference to services that your
6
company provides to State Street Partners, what
7
specifically do you mean?
8
A.
9
tax return.
Preparation of the annual partnership
10
Q.
Anything else?
11
A.
No.
12
Q.
Do you play a role in the actual
13
remittance of taxes?
14
A.
No.
15
Q.
So you're talking about return
16
preparation?
17
A.
Yes.
18
Q.
As part of that, do you also prepare
19
the K1s?
20
A.
Yes.
21
Q.
Is there anything else that your
22
company does for State Street Partners that's
23
included within this phrase you used, "tax
24
compliance"?
Thomas Rankin
January 5, 2009
92 1
A.
Not that I can think of.
2
Q.
You also told me that your company does
3
bookkeeping or provides bookkeeping services to
4
State Street Partners.
5
company do in the way of bookkeeping for State
6
Street Partners?
7
A.
8
from Ms. Harrison and puts it into QuickBooks, a
9
QuickBooks format.
What precisely does your
My company receives a check register
10
Q.
11
financial statements for State Street Partners?
12
A.
No.
13
Q.
Once the information from the check
14
register is put into a QuickBooks format, are
15
there various kinds of reports that you or an
16
operator can print from QuickBooks based on the
17
data input from the check register?
18
A.
Yes.
19
Q.
For example, can you print a profit and
20
loss statement for State Street Partners using
21
QuickBooks?
22
A.
Yes.
23
Q.
Can you print a balance sheet using
24
QuickBooks?
Does your company also prepare any
Thomas Rankin
January 5, 2009
93 1
A.
Yes.
2
Q.
Can you print a general ledger using
3
QuickBooks?
4
A.
Yes.
5
Q.
Did you personally play any role in
6
helping to assemble documents that the Defendants
7
in this lawsuit in which your deposition is being
8
taken would produce to the Plaintiffs?
9
A.
Yes.
10
Q.
Did you play a role in generation of or
11
printing of the balance sheet, the general ledger,
12
and the profit and loss statement for State Street
13
Partners?
14
A.
15
me, yes.
16
Q.
Information provided to you by whom?
17
A.
The check register, by Ms. Harrison.
18
Q.
Did you also play the same role in
19
connection with generation of or printing of the
20
balance sheet, the general ledger, and the profit
21
and loss statements that have been produced for
22
State Street Consultants?
23
A.
24
yes.
Based on the information provided to
Based on information provided to me,
Thomas Rankin
January 5, 2009
94 1
Q.
2
Corp.?
3
A.
No.
4
Q.
Did you have any role or play any role
5
whatsoever in -- I'm sorry.
6
A.
7
asking the same question that you asked two
8
previous times?
9
Q.
For a different entity, yes.
10
A.
Same exact question?
11
Q.
Well, let me just ask the question.
12
think it's going to be easier at this point.
13
A.
I appreciate it.
14
Q.
The entity that I'm going to reference
15
is NSC Consulting Corp., and the question is:
16
you personally generate or print the balance
17
sheets, the general ledgers, and the profit and
18
loss statements that NSC Consulting Corp. has
19
produced in connection with this litigation?
20
A.
Based on information provided, yes.
21
Q.
Was there anything that you personally
22
had to do to gain access to the QuickBooks data of
23
these entities in order to be able to generate
24
those documents?
Is the same true for NSC Consulting
I thought it was the same -- are you
I
Did
Thomas Rankin
January 5, 2009
95 1
A.
Repeat that again.
2
Q.
Certainly.
3
personally had to do to gain access to the
4
QuickBooks data of these entities in order to be
5
able to generate those documents?
6
A.
Turn on my computer.
7
Q.
Anything else?
8
A.
No.
9
Q.
Were you able to access that data from
Was there anything that you
Yes.
10
your personal computer?
11
A.
Yes.
12
Q.
Where was it located at the time that
13
you accessed the data for purposes of generating
14
and printing these reports?
15
A.
996 Poppy Hills Drive.
16
Q.
So you were able to do that from your
17
home?
18
A.
Yes.
19
Q.
Prior to the time when you received the
20
request to go into QuickBooks and generate these
21
reports, Mr. Rankin, did you already have the
22
ability to go into the QuickBooks database of
23
these three entities via your own computer?
24
A.
It is on my computer.
QuickBooks.
Thomas Rankin
January 5, 2009
96 1
Q.
2
Right?
3
A.
Yes.
4
Q.
You have that on your personal
5
computer?
6
A.
Yes.
7
Q.
Is that an application that you use
8
generally in connection with your accounting
9
practice?
Okay.
QuickBooks is an application.
Yes?
10
A.
Yes.
11
Q.
Is that an application that you use for
12
clients of your firm other than State Street
13
Consultants, State Street Partners, NSC Consulting
14
Corp., and Neil S. Clark?
15
A.
Yes.
16
Q.
The data that one can access and
17
manipulate through use of QuickBooks for State
18
Street Consultants, State Street Partners, NSC
19
Consulting group, and Neil S. Clark resides where?
20
A.
In my computer.
21
Q.
Is your computer part of a computer
22
network that also includes computers of State
23
Street Consultants?
24
A.
Yes.
Thomas Rankin
January 5, 2009
97 1
Q.
For how long has that been the case?
2
A.
Since 2004.
3
Q.
Who else at State Street Consultants
4
works with QuickBooks?
5
A.
No one that I'm aware of.
6
Q.
Does Janie Harrison work with
7
QuickBooks?
8
A.
9 10 11 12
No. MR. WEAVER:
Bathroom break.
THE VIDEOGRAPHER:
We are off the
record at 12:48. - - - - -
13
Thereupon, a luncheon recess is taken
14
at 12:48 p.m.
15 16 17 18 19 20 21 22 23 24
- - - - -
Thomas Rankin
January 5, 2009
98 1
Monday Afternoon Session
2
January 5, 2009, 1:30 p.m.
3
- - - - -
4
THE VIDEOGRAPHER:
5
record at 1334.
6
1334.
7
We are back on the
We are back off the record at
We are back on the record at 1336.
8
BY MR. CVETANOVICH:
9
Q.
Mr. Rankin, welcome back from lunch.
10
All ready to resume?
11
A.
Yes.
12
Q.
Okay.
13
Let's do that.
At an earlier point in our proceeding
14
today when you were describing to me the services
15
that you provide to State Street Partners, I
16
understood you to say that at least upon occasion
17
you interact on its behalf with its banks.
18
understand that correctly?
19
A.
I have.
20
Q.
And I think you specifically alluded to
21
the mortgage.
22
A.
Yes.
23
Q.
The title to 137 East State Street is
24
in the name of State Street Partners, correct?
Did I
Did I understand that correctly?
Thomas Rankin
January 5, 2009
99 1
A.
As far as I know.
2
Q.
And there is a mortgage on the
3
building, correct?
4
A.
Yes.
5
Q.
Do you know who is the holder of the
6
mortgage interest in the building?
7
A.
Fifth Third Bank.
8
Q.
Do you play any role in connection with
9
State Street Partners' mortgage payments to Fifth
10
Third Bank?
11
A.
No role.
12
Q.
Have there been instances, to your
13
knowledge, when State Street Partners missed a
14
mortgage payment in whole or in part?
15
A.
Yes.
16
Q.
How many times has that happened, to
17
your recollection?
18
A.
Several.
19
Q.
When that has happened, has that
20
occasioned a need for someone on behalf of State
21
Street Partners to communicate with the bank?
22
A.
Yes.
23
Q.
Have you been that someone?
24
A.
Under authority, I have.
Thomas Rankin
January 5, 2009
100 1
Q.
2
communicated in those instances where State Street
3
Partners missed a mortgage payment?
4
A.
Eric Reidinger.
5
Q.
Anyone else?
6
A.
Can't remember the other fellow's name.
7
Q.
There is another fellow from Fifth
8
Third Bank?
9
A.
With whom at Fifth Third Bank have you
Before Eric Reidinger, Rob Hasslinger I
10
think was his name.
11
Q.
Those are tough names.
12
A.
Some things I remember well.
13
Q.
You've dealt with both of those
14
gentlemen?
15
A.
16
Reidinger.
17
Q.
18
officer?
19
A.
Yes.
20
Q.
And now you're dealing with Eric
21
Reidinger?
22
A.
I'm not dealing with any of it now.
23
Q.
Why are you not dealing with any of it
24
now?
More with Rob Hasslinger than with Eric
And Rob Hasslinger is the former loan
Thomas Rankin
January 5, 2009
101 1
A.
2
attorneys are dealing with it.
3
Q.
4
State Street Partners?
5
A.
I would presume.
6
Q.
Who is that?
7
A.
I don't know for sure.
8
Q.
When you said "the attorneys," what
9
attorneys did you mean?
I'm under the understanding that the
The attorneys being legal counsel for
10
A.
11
Fifth Third, and I know that Jamie Ryan has talked
12
with Fifth Third.
13
Q.
14
time that you and your firm have provided services
15
to State Street Partners when it has renegotiated
16
the terms of its mortgage with Fifth Third Bank?
17
A.
I'm sorry.
18
Q.
Yes.
19
occasion during the time that you and your firm
20
have provided services to State Street Partners
21
when State Street Partners has renegotiated the
22
terms of its mortgage with Fifth Third Bank?
23
A.
24
with services during that time.
I know that Bob Behal has talked with
Have there been occasions during the
Can you ask that again?
Have there been occasions or any
I have provided State Street Partners
Thomas Rankin
January 5, 2009
102 1
Q.
2
terms of the mortgage?
3
A.
As far as I understand, yes.
4
Q.
Have you been involved in the process?
5
A.
A portion of the process.
6
Q.
What portion of the process have you
7
been involved in?
8
A.
The initial portion.
9
Q.
Tell me what the initial portion in
Have there been renegotiations of the
10
which you were involved was.
11
A.
12
mortgage.
13
Q.
14
out?
15
A.
January of 2003.
16
Q.
When was it refinanced?
17
A.
I don't know specifically.
18
Q.
What's your best recollection?
19
A.
Can you define "refinance" for me?
20
Q.
Well, you used the term in an answer
21
just a couple of moments ago, so I mean it in the
22
same sense that you meant it.
23
A.
24
original note has not been refinanced.
The refinancing of the original
When was the original mortgage taken
I'm not -- as far as I'm aware, the
Thomas Rankin
January 5, 2009
103 1
Q.
2
change in the terms of State Street Partners'
3
borrowing relationship with Fifth Third Bank?
4
A.
5
extended.
6
Q.
7
time when the mortgage had to be paid off has been
8
stretched out?
9
A.
Yes.
10
Q.
Have any other aspects of the mortgage
11
been changed?
12
A.
To my knowledge, yes.
13
Q.
What other terms of the mortgage
14
relationship have been changed?
15
A.
16
payments have been deferred.
17
Partners is paying interest only.
18
Q.
19
the loan?
20
A.
No.
21
Q.
There came a point in time when that
22
change was made by the parties to the mortgage
23
arrangement?
24
A.
To your knowledge, has there been any
The terms of the mortgage have been
All right.
Meaning that the point in
It's my understanding the principal And State Street
Was that the case in the inception of
Yes.
Thomas Rankin
January 5, 2009
104 1
Q.
Do you recall when that was?
2
A.
June 2008.
3
Q.
Do you recall why that was?
4
A.
Dispute amongst owners.
5
Q.
When you say a dispute amongst owners,
6
isn't State Street Partners the only owner of that
7
building?
8
A.
9
Partners.
Dispute of investors in State Street
10
Q.
So you mean Mr. Clark and Mr. Tipps?
11
A.
Yes.
12
Q.
They're the only two partners in State
13
Street Partners, correct?
14
A.
Yes.
15
Q.
What did any dispute between them have
16
to do with the need of State Street Partners to
17
seek to renegotiate the terms of the mortgage?
18
A.
I'm sorry.
Can you please repeat?
19
Q.
Certainly.
What did any dispute
20
between them have to do with the need of State
21
Street Partners to seek to renegotiate the terms
22
of the mortgage?
23
A.
24
know specifically.
I would guess -- I'd have to -- I don't
Thomas Rankin
January 5, 2009
105 1
Q.
2
State Street Partners sought to renegotiate the
3
terms of the mortgage was because of a dispute
4
amongst the owners.
5
the owners you meant Mr. Clark and Mr. Tipps.
6
A.
Uh-huh.
7
Q.
And now I'm trying to understand what
8
that dispute, as you've characterized it, between
9
Mr. Clark and Mr. Tipps had to do with creating a
You had told me that the reason that
And then you told me that by
10
need for State Street Partners to seek to
11
renegotiate the mortgage.
12
A.
13
anyway.
14
relating to a lease of the space between State
15
Street Consultants and State Street Partners.
16
Q.
17
renegotiated anyway?
18
A.
19
note due February of 2008 or January of 2008.
20
Q.
21
Street Partners not have the resources to pay off
22
the note?
23
A.
No.
24
Q.
So it needed to renegotiate the
The mortgage needed to be renegotiated And the dispute, as far as I'm aware, was
Why did the mortgage need to be
From what I recall, it was a five-year
As that date approached, did State
As far as I'm aware.
Thomas Rankin
January 5, 2009
106 1
mortgage or somehow come up with the money to pay
2
off the note?
3
A.
4
the note.
5
Q.
6
of trying to accomplish that, correct?
7
A.
Yes.
8
Q.
And you played a role in that process,
9
did you not?
Renegotiate, refinance, yes, or pay off
And, in fact, it then set upon a course
10
A.
Early on.
11
Q.
Tell us what role you played in the
12
process.
13
A.
14
new loan for State Street Partners.
15
Q.
16
in getting the new terms?
17
A.
Rob Hasslinger.
18
Q.
Anyone else?
19
A.
No.
20
Q.
What was required of you to get the
21
terms of what would become a new mortgage note?
22
A.
Phone call.
23
Q.
A single phone call?
24
A.
No.
Getting the terms from the bank of a
With whom did you interact at the bank
More than one.
Thomas Rankin
January 5, 2009
107 1
Q.
2
the mortgage loan agent?
3
A.
Correct.
4
Q.
Did you have to meet with him?
5
A.
No.
6
Q.
Did you meet with anyone from Fifth
7
Third Bank as part of that process?
8
A.
The early process, no.
9
Q.
By your reference to the early process,
So multiple telephone discussions with
10
I'm led to ask:
11
process when you had to meet with someone from
12
Fifth Third Bank?
13
A.
14
Third Bank.
15
Q.
16
someone from Fifth Third Bank?
17
A.
Once, possibly twice.
18
Q.
With whom did you meet?
19
A.
Eric Reidinger.
20
Third representatives that I don't recall their
21
names.
22
Q.
Where was the meeting?
23
A.
Fifth Third Bank.
24
Q.
What was the purpose of the meeting?
Was there a point later in the
I did meet with someone from Fifth I'm not sure I had to. How many times did you meet with
And two other Fifth
Thomas Rankin
January 5, 2009
108 1
A.
To discuss the status of the mortgage.
2
Q.
Of the mortgage before the terms were
3
changed?
4
A.
Yes.
5
Q.
Where was the meeting held?
6
A.
Fifth Third Bank.
7
Q.
Did anyone accompany you to the meeting
8
on behalf of State Street Partners?
9
A.
Neil Clark was at the meeting.
10
Q.
Was anyone else from State Street
11
Partners at the meeting?
12
A.
No.
13
Q.
Did Mr. Clark accompany you to the
14
meeting?
15
A.
Accompany -- walk together?
16
Q.
Yes.
17
A.
Yes.
18
Q.
Did you walk over and back together?
19
A.
I don't recall.
20
Q.
As part of that process of
21
renegotiation of the terms of the mortgage, was
22
there a requirement that an application be
23
submitted on behalf of State Street Partners?
24
A.
I don't recall if there was an
Thomas Rankin
January 5, 2009
109 1
application that was resubmitted.
2
Q.
3
financial documents be submitted to Fifth Third
4
Bank?
5
A.
I would presume, yes.
6
Q.
Do you recall what manner of financial
7
documents were submitted to Fifth Third Bank as
8
part of that process?
9
A.
I don't recall exactly.
10
Q.
Did you take care of that?
11
A.
I don't recall if I would have taken
12
care of that.
13
Q.
14
mortgage relationship between State Street
15
Partners and Fifth Third Bank, either before or
16
after the renegotiation of terms, has State Street
17
Partners been required to make periodic
18
submissions of financial information to the bank?
19
A.
Yes.
20
Q.
How frequently is State Street Partners
21
required to make submissions of financial
22
information to the bank?
23
A.
Annually.
24
Q.
Is that under the terms of the mortgage
Was there a requirement that any
As a term of the mortgage, or the
Thomas Rankin
January 5, 2009
110 1
as renegotiated, or was that under the original
2
mortgage terms?
3
A.
4
or if --
5
Q.
6
Partners has had to do throughout the mortgage
7
lending relationship with Fifth Third Bank?
8
A.
Probably.
9
Q.
Do you have a recollection?
10
A.
Yes.
11
Q.
So it's been there throughout the
12
relationship?
13
A.
Yes.
14
Q.
What financial information does State
15
Street Partners periodically submit to Fifth Third
16
Bank?
17
A.
18
statement.
19
Q.
Anything else?
20
A.
That State Street Partners submits to
21
the bank?
22
Q.
Yes, sir.
23
A.
I don't recall.
24
Q.
Does State Street Partners regularly
I don't know where it is in the terms,
Is that something that State Street
Balance sheet, profit and loss
Thomas Rankin
January 5, 2009
111 1
submit cash flow statements to the bank?
2
A.
Not that I'm aware of.
3
Q.
Does State Street Partners regularly
4
submit to the bank statements of sources and uses
5
of moneys or revenues?
6
A.
Not that I'm aware of.
7
Q.
Have you ever seen a statement of
8
sources and uses of revenues for State Street
9
Partners?
10
A.
Yes.
11
Q.
Do you prepare those?
12
A.
No.
13
Q.
Who prepares those?
14
A.
Ms. Harrison.
15
Q.
Is that done in QuickBooks?
16
A.
No.
17
Q.
Is it done under your supervision?
18
A.
No.
19
Q.
Do you know whether pursuant to the
20
terms of the mortgage that State Street Partners
21
has with Fifth Third Bank, State Street Partners
22
is required to submit financial information of
23
State Street Consultants?
24
A.
Yes.
Thomas Rankin
January 5, 2009
112 1
Q.
2
required to submit to Fifth Third Bank financial
3
information of State Street Consultants?
4
A.
I don't know the exact requirement.
5
Q.
Just as best you can recollect, how
6
frequently is a submission made to the bank?
7
A.
Annually.
8
Q.
Were any submissions of financial
9
information of State Street Consultants made to
How often is State Street Partners
10
Fifth Third by State Street Partners in connection
11
with renegotiation of the terms of the mortgage?
12
A.
I don't recall.
13
Q.
When financial information of State
14
Street Consultants is submitted to Fifth Third
15
Bank by State Street Partners, what is submitted?
16
A.
A balance sheet, and a P&L.
17
Q.
Anything else?
18
A.
Possibly a cash flow.
19
Q.
That would be the cash flow statements
20
prepared by Ms. Harrison?
21
A.
Yes.
22
Q.
Before financial information is
23
submitted to Fifth Third Bank, do you personally
24
review it for accuracy?
Thomas Rankin
January 5, 2009
113 1
A.
QuickBooks information I do review.
2
Q.
What about the cash flow statements?
3
A.
No.
4
Q.
Does anyone review those for accuracy
5
before they're submitted to Fifth Third Bank?
6
A.
I don't know.
7
Q.
Does State Street Consultants have a
8
lending relationship with any banks or a borrowing
9
relationship with any banks?
10
A.
Yes.
11
Q.
What banks?
12
A.
I'm aware of Huntington Bank and Fifth
13
Third Bank.
14
Q.
15
Consultants' borrowing from Fifth Third Bank?
16
A.
17
outstanding.
18
Q.
19
note?
20
A.
I don't recall.
21
Q.
What is its maturity date?
22
A.
I don't recall that.
23
Q.
What was the borrowing for?
24
A.
The borrowing was to term out debt,
What is the nature of State Street
Term note.
They have a term note
What is the principal amount of the
Thomas Rankin
January 5, 2009
114 1
outstanding debt.
2
Q.
3
outstanding debt?
4
A.
I don't particularly know specifically.
5
Q.
Excuse me.
6
credit?
7
A.
Yes.
8
Q.
It also include credit card debt?
9
A.
Not to my knowledge.
10
Q.
Do you recall what the limit was on the
11
line of credit?
12
A.
200,000.
13
Q.
At the time that the borrowing was
14
termed out, as you've put it, had State Street
15
Consultants been running at or near the limit on
16
the line of credit?
17
A.
Yes.
18
Q.
And so a decision was made to term that
19
out?
20
A.
Yes.
21
Q.
Do you recall what the principal amount
22
was at the time that that borrowing was termed
23
out?
24
A.
What activities have given rise to the
Was it draws upon a line of
It's my recollection.
I'm sorry.
Can you ask that again?
Thomas Rankin
January 5, 2009
115 1
Q.
Yes, sir.
2
Do you recall what the principal amount
3
was at the time that the borrowing was termed out?
4
A.
195,000, maybe.
5
Q.
Do you recall what the term was for
6
repayment of the principal amount?
7
A.
I don't.
8
Q.
Do you recall what the interest rate
9
was?
10
A.
I don't.
11
Q.
Was the interest rate achieved through
12
terming out the borrowing on the line of credit
13
less than the interest rate that was payable on
14
the line of credit?
15
A.
I don't know.
16
Q.
Does State Street Consultants have any
17
other borrower relationships with Fifth Third
18
Bank?
19
A.
Not that I'm aware of.
20
Q.
What is the nature of State Street
21
Consultants' borrowing relationship with
22
Huntington Bank?
23
A.
Line of credit.
24
Q.
Do you know the limit on that line of
Thomas Rankin
January 5, 2009
116 1
credit?
2
A.
100,000.
3
Q.
Do you know if there is any security
4
for that line of credit from Huntington Bank?
5
A.
I don't know.
6
Q.
Do you know if there are any guarantors
7
of State Street Consultants' repayment obligation
8
on the Huntington Bank line of credit?
9
A.
Yes.
10
Q.
Who are the guarantors?
11
A.
Mr. Clark and Mr. Tipps.
12
Q.
Any others?
13
A.
Not that I'm aware of.
14
Q.
Do you know if State Street Consultants
15
has given any other security for its repayment
16
obligation on the line of credit to Huntington
17
Bank?
18
A.
I don't know.
19
Q.
Do you know if State Street Consultants
20
has given any security for its repayment
21
obligation on the term loan from Fifth Third Bank?
22
A.
I don't know.
23
Q.
Do you know if State Street Partners
24
has given Fifth Third Bank any security apart from
I don't remember.
Thomas Rankin
January 5, 2009
117 1
the mortgage interest itself in the realty for its
2
repayment obligation on the mortgage loan?
3
A.
Can you say that again?
4
Q.
Yes, sir.
5
(Conference room phone rings.)
6
MR. CVETANOVICH:
7
Gonzalez.
8 9
Do you want to go
off the record? MR. CVETANOVICH: just a minute.
12 13
Let's hold on just a minute. THE VIDEOGRAPHER:
10 11
This could be John
I think we should for
It will take him a few minutes --
THE VIDEOGRAPHER:
We are off the
record at 1404.
14
(A brief recess is taken.)
15
THE VIDEOGRAPHER:
We are back on the
16
record at 1408.
17
Q.
18
break upon Mr. Gonzalez's arrival, you had just
19
asked me to repeat a question, so let me repeat
20
the question.
21
you can answer it.
22
I'll rephrase it.
23
know if State Street Partners has given Fifth
24
Third Bank any security apart from the mortgage
Mr. Rankin, before we took a short
If it makes sense to you, great, If it doesn't, tell me and The question is this:
Do you
Thomas Rankin
January 5, 2009
118 1
interest itself in the realty for its repayment
2
obligation on the mortgage loan?
3
A.
Not that I'm aware of.
4
Q.
Do you know if there are any guarantors
5
of State Street Partners' repayment obligation on
6
the mortgage loan?
7
A.
Yes.
8
Q.
What or who are the guarantors?
9
A.
Mr. Clark, Mr. Tipps, and State Street
10
Consultants.
11
Q.
Any others?
12
A.
Not that I'm aware of.
13
Q.
Do you know if there is a condition of
14
the mortgage that a certain percentage of the
15
space at 137 East State Street has to be leased?
16
A.
17
or remember.
18
Q.
19
Let's go back to the renegotiation of the terms of
20
the mortgage and just pin down a couple of things.
21
I don't know, or not that I'm aware of
Do you know what the -- strike that.
You told me that now the mortgage is
22
interest only, correct?
23
A.
As far as I'm aware of.
24
Q.
And then there is, what, a balloon
Thomas Rankin
January 5, 2009
119 1
payment of principal on maturity date.
2
correct?
3
A.
4
for I know -- I'm presuming that it's interest
5
only.
6
Q.
Have you read the mortgage documents?
7
A.
I may have, but I don't recall the
8
exact terms.
9
Q.
Did you read the mortgage note?
10
A.
I may have, but I don't remember the
11
exact terms.
12
Q.
13
note on behalf of State Street Partners?
14
A.
Which mortgage note?
15
Q.
Are there multiple mortgage notes at
16
this point?
17
A.
18
note and a extended mortgage note.
19
Q.
20
those again.
21
Is that
I don't know what the terms are except
Do you know who signed the mortgage
We've talked about an original mortgage
Fair enough.
Let's talk about both of
The original mortgage note, do you know
22
who signed it on behalf of State Street Partners?
23
A.
I don't recall.
24
Q.
The renegotiated mortgage note, if we
Thomas Rankin
January 5, 2009
120 1
can call it that, do you know who signed that on
2
behalf of State Street Partners?
3
A.
I don't recall.
4
Q.
Did you sign either of those notes on
5
behalf of State Street Partners?
6
A.
No.
7
Q.
Do you know who signed the guaranty
8
that State Street Consultants executed to assure
9
the repayment on the mortgage note?
10
A.
I don't recall.
11
Q.
In the scheme of things at Thomas A.
12
Rankin & Associates, do you consider State Street
13
Consultants, State Street Partners, and NSC
14
Consulting Corp. as one client?
15
A.
Yes.
16
Q.
Do you consider Mr. Clark to be part of
17
that one client?
18
A.
Yes.
19
Q.
You told me earlier today, quite a bit
20
earlier today, that you've got more than 80
21
clients in Thomas A. Rankin & Associates, correct?
22
A.
I do recall that.
23
Q.
Is the one client consisting of State
24
Street Consultants, State Street Partners, NSC
Thomas Rankin
January 5, 2009
121 1
Consulting Corp., and Mr. Clark your firm's
2
biggest client?
3
A.
Yes.
4
Q.
For how long has that been the case?
5
A.
Since 1999.
6
Q.
Based upon fee revenues from clients,
7
how many times larger is the State Street
8
Consultants client than any other client of your
9
firm?
10
A.
11
please?
12
correctly.
Can you ask that question again, I want to make sure I answer it
13
MR. CVETANOVICH:
14
MR. WEAVER:
Sure.
Sure.
Could you also -- the term
15
using State Street Consultants, do you mean the
16
conglomerate that you spoke of earlier?
17 18
MR. CVETANOVICH:
21
It's a little
awkward, but --
19 20
I do.
MR. WEAVER:
Do you want to call it the
group? MR. CVETANOVICH:
We can do that.
Let
22
me propose that to the witness and see if he finds
23
that acceptable.
24
MR. WEAVER:
I don't want to run your
Thomas Rankin
January 5, 2009
122 1
depo.
2
Just want to make sure we're clear. MR. CVETANOVICH:
We're all looking for
3
good communication.
4
Q.
5
I am referring to State Street Consultants, State
6
Street Partners, NSC Consulting Group, excuse me,
7
Consulting Corp., and Mr. Clark, insofar as they
8
are treated by your company as one client, that I
9
call them the group.
Mr. Weaver has just proposed that when
Is that okay with you, just
10
to facilitate communication?
11
A.
Yes.
12
Q.
Okay.
13
my question is, based upon fee revenues from
14
clients, how many times larger is the group than
15
any other client of your firm?
16
A.
It varies.
17
Q.
If you had to average it, on average is
18
it two times bigger, three times bigger, 20 times
19
bigger than your next largest client?
20
A.
21
not my biggest client.
22
my biggest client.
23
Q.
24
been your biggest client.
Then that's what we'll do.
Then
Several years it was smaller, or was And several years it was
But you've told me since 1999 it has
Thomas Rankin
January 5, 2009
123 1
A.
2
I need to fix that. MR. WEAVER:
I forgot about --
Clarify what you meant.
3
Q.
Please fix it.
4
A.
I forgot about a client that I had had
5
for several -- many -- years, yes.
6
Q.
7
that you forgot about it.
8
A.
Right.
9
Q.
Let's do it this way.
We won't tell your long-time client
I apologize for that. For 2006, 2007,
10
2008, has the group been your firm's largest
11
client?
12
A.
Yes.
13
Q.
For that period of time, how much
14
bigger has the group been than your firm's next
15
largest client, again, based upon fee revenue?
16
A.
Four times.
17
Q.
Have you read the State Street
18
Consultants' operating agreement?
19
A.
I have.
20
Q.
Are you conversant with its terms?
21
A.
No.
22
Q.
Do you know who are the members of
23
State Street Consultants?
24
A.
Yes.
Thomas Rankin
January 5, 2009
124 1
Q.
Who are they?
2
A.
Neil Clark, and that's how I prepare
3
the tax returns, based on Neil Clark being a
4
member.
5
Q.
Being the sole member?
6
A.
Yes.
7
Q.
You don't believe that Mr. Tipps is
8
also a member?
9
A.
I don't believe Mr. Tipps is a member.
10
Q.
Why do you say that?
11 12
MR. WEAVER:
we're talking about, please?
13 14
Can we ask what time frame
MR. CVETANOVICH:
I'm talking
presently.
15
MR. WEAVER:
16
MR. CVETANOVICH:
Thank you. Yeah.
17
A.
18
provided to Mr. Tipps showing zero capital, zero
19
earnings, and my definition of -- that, to me,
20
reflects that Mr. Tipps was not a member, and I
21
never heard anything to the contrary after that
22
K-1 was given to Mr. Tipps.
23
Q.
24
did have a membership interest in the entity?
I prepared a 2006 tax return with a K-1
Didn't that K-1 also reflect that he
Thomas Rankin
January 5, 2009
125 1
A.
Yes.
2
Q.
All right.
3
for State Street Consultants for 2007?
4
A.
No.
5
Q.
Did anyone do that?
6
A.
No.
7
Q.
It's too soon for 2008.
8
prepare K-1s for State Street Consultants for
9
2005?
Now, did you prepare K-1s
Did you
10
A.
Yes.
11
Q.
Was Mr. Tipps reflected as member on
12
the K-1s prepared for 2005?
13
A.
Yes.
14
Q.
The fact of the matter is Mr. Tipps has
15
been reflected as a member on the K-1s prepared
16
for State Street Consultants every year from the
17
very beginning of its existence, correct?
18
A.
19
prepared the tax return the first year, but I
20
don't recall if I did that return.
21
Q.
22
return, the K-1s have reflected that Mr. Tipps is
23
a member, correct?
24
A.
As far as I know, yes.
I'm not sure I
Every year you have prepared the tax
Yes.
Thomas Rankin
January 5, 2009
126 1
Q.
2
return, a federal tax return, for 2007?
3
A.
No.
4
Q.
Why not?
5
A.
The Internal Revenue Code states a
6
single member LLC does not file a entity tax
7
return.
8
Q.
What happens in lieu of that?
9
A.
A schedule C is filed on the single
Did State Street Consultants file a tax
10
member, along with the single member's individual
11
income tax return, or the sole member.
12
Q.
13
return preparation and filing for State Street
14
Consultants and for Neil Clark for calendar year
15
2007, you treated Mr. Clark as the sole member of
16
SSC?
17
A.
I did.
18
Q.
For 2006, did you file an entity tax
19
return for SSC?
20
A.
Yes.
21
Q.
Why did you do it in '06 but not '07?
22
A.
Because I determined that Mr. Tipps was
23
an member -- a member of State Street Consultants
24
for at least one minute of 2006.
Is it the case that in handling the tax
Thomas Rankin
January 5, 2009
127 1
Q.
What did you base that on?
2
A.
I based that on Mr. Tipps' retirement
3
agreement or asset purchase agreement and through
4
discussions with Neil Clark or Dan Rohletter.
5
Q.
Who is Dan Rohletter?
6
A.
Dan is an attorney with Carlile,
7
Patchen & Murphy.
8
Q.
9
Mr. Rohletter about this issue?
Why would you have a discussion with
10
A.
11
documents I just referred to.
12
Q.
13
connection with that exercise?
14
A.
15
Consultants.
16
Q.
17
personal income tax return for calendar year 2006?
18
A.
Yes.
19
Q.
Did he file a personal income tax
20
return for calendar year 2007?
21
A.
Yes.
22
Q.
Did State Street Consultants have a
23
profit, have a loss, or break even for calendar
24
year 2007?
Mr. Rohletter took part in drafting the
Do you know who he represented in
As far as I understand, State Street
Do you know if Neil Clark has filed a
Thomas Rankin
January 5, 2009
128 1
A.
Profit.
2
Q.
Was that profit reflected on Schedule C
3
of Mr. Clark's personal income tax return for
4
2007?
5
A.
Yes.
6
Q.
Did you personally prepare Mr. Clark's
7
income tax return for 2007?
8
A.
As an employee of my company, yes.
9
Q.
What's the significance of the way you
10
qualified your "yes" answer there?
11
didn't track that very well.
12
A.
13
an entity that's on the tax returns.
14
a tax return, I sign it on behalf of Thomas A.
15
Rankin & Company.
16
Q.
17
that you weren't acting outside the business?
18
it that simple?
19
A.
Yeah, it's pretty simple.
20
Q.
All right.
21
A.
I'm a simple guy.
22
Q.
There's a camera there.
23 24
I just -- I
I'm just -- wanted to make sure I have When I sign
So you're just trying to convey to me Is
To your knowledge, has Mr. Clark been the sole management authority in State Street
Thomas Rankin
January 5, 2009
129 1
Consultants since Mr. Tipps' retirement?
2
A.
To my knowledge, yes.
3
Q.
Do you recall when Mr. Tipps retired
4
from active lobbying?
5
A.
October 2005.
6
Q.
Have you ever reviewed the partnership
7
agreement of State Street Partners, PLL?
8
A.
Yes.
9
Q.
For what purpose?
10
A.
To review -- no specific purpose.
11
Q.
Do you recall when you reviewed it?
12
A.
Not exactly.
13
Q.
How many times have you reviewed it?
14
A.
Several, I'm sure.
15
Q.
When was the most recent time?
16
A.
Several months ago.
17
Q.
What was the purpose for your most
18
recent review of the partnership agreement?
19
A.
Just to try to become familiar with it.
20
Q.
Did you undertake that in connection
21
with the performance of any particular specific
22
task for State Street Partners?
23
A.
No.
24
Q.
Did you undertake that review for the
Thomas Rankin
January 5, 2009
130 1
purpose of putting yourself in a position to
2
better advise your client on particular matters?
3
A.
Possibly.
4
Q.
Do you have a recollection?
5
A.
No.
6
Q.
How many times have you reviewed the
7
operating agreement of State Street Consultants?
8
A.
I don't know specifically.
9
Q.
When's the most recent time you
10
reviewed that?
11
A.
Within 60 days.
12
Q.
What was the reason why you reviewed it
13
most recently?
14
A.
15
member.
16
Q.
17
the last 60 days?
18
A.
Yes.
19
Q.
Did anyone ask you to do that?
20
A.
Yes.
21
Q.
Who asked you to do that?
22
A.
Mr. Clark.
23
Q.
What specifically did he say to you?
24
A.
"See if Mr. Tipps is a member."
To see if Paul was a -- Mr. Tipps was a
Did you look back at that issue within
Thomas Rankin
January 5, 2009
131 1
Q.
2
agreement, did you do anything else?
3
A.
Yes.
4
Q.
What else?
5
A.
Looked at other agreements.
6
Q.
What other agreements?
7
A.
Asset purchase agreement, and SERP,
8
Supplemental Employee Retirement Plan.
9
Q.
Did you look at anything else?
10
A.
I don't recall.
11
Q.
Did you reach a conclusion?
12
A.
I reached my conclusion when I filed
13
the original tax return.
14
Q.
15
pursuant to Mr. Clark's request within the past 60
16
days, did you reach any new or different
17
conclusion?
18
A.
19
conclusion.
20
Q.
21
before?
22
A.
Yes.
23
Q.
This time you came to the conclusion
24
based upon a review of all those contracts you
Apart from reviewing the operating
When you went through this exercise
I have not reached a different or new
Did you come to the same conclusion as
Thomas Rankin
January 5, 2009
132 1
just named for us, correct?
2
A.
No.
3
Q.
Did reviewing those contracts or any of
4
those contracts lead to the conclusion that you
5
reached?
6
A.
No.
7
Q.
What then led you to conclude as
8
recently as 60 days ago that Mr. Tipps is not a
9
member of State Street Consultants?
10
A.
11
tax return for State Street Consultants.
12
Q.
13
as a consequence of reviewing all these documents?
14
A.
15
hasn't changed.
16
Q.
17
take a look at that issue for him?
18
A.
He asks me a lot.
19
Q.
Do you know why he asked you to do that
20
particular thing for him?
21
A.
To give him my thoughts, my opinion.
22
Q.
When you completed the exercise, did
23
you share with him your thoughts or your opinion?
24
A.
I concluded that when I filed the 2006
But you did not reach any conclusions
I'm not an attorney, and my conclusion
Do you know why Mr. Clark asked you to
I'm sure I did.
Thomas Rankin
January 5, 2009
133 1
Q.
What did you tell him?
2
A.
I didn't think Mr. Tipps was a member.
3
Q.
Did you tell him why?
4
A.
Yes.
5
Q.
What did you tell him?
6
A.
Advice of counsel that he had in 2006
7
reflected that.
8
Q.
What counsel are you referring to?
9
A.
Dan Rohletter.
10
Q.
Are you familiar with the fact that
11
there was an amendment to the limited liability
12
partnership agreement of State Street Partners?
13
A.
I don't recall seeing an amendment.
14
Q.
Are you aware that the governing
15
documents of State Street Partners designate
16
Mr. Tipps as the managing partner of State Street
17
Partners?
18
A.
I do recall seeing that.
19
Q.
Do you know if Mr. Tipps has, in fact,
20
acted to manage the affairs of State Street
21
Partners since his retirement?
22
A.
Not to my knowledge.
23
Q.
Do you know if during 2008 Mr. Tipps
24
has had to reassert himself as the managing
Thomas Rankin
January 5, 2009
134 1
partner of State Street Partners?
2
A.
Can you ask that again, please?
3
Q.
Certainly.
4
A.
Sorry.
5
Q.
Do you know if during 2008 Mr. Tipps
6
has had to reassert himself as the managing
7
partner of State Street Partners?
8
A.
9
had to reassert himself, but I'm under the
Has he had to?
I don't know if he has
10
presumption that he has asserted himself.
11
Q.
Do you know why?
12
A.
I can't comment on why Mr. Tipps
13
asserted himself.
14
Q.
15
as managing partner of State Street Partners
16
affected you in any way in the performance of your
17
obligations to the group?
18
A.
Not to this point.
19
Q.
Has Mr. Tipps given you or tried to
20
give you any directives insofar as you have been
21
performing services for State Street Partners?
22
A.
Can you ask that again?
23
Q.
Certainly.
24
A.
Time period?
Has Mr. Tipps asserting his prerogative
I'm sorry.
Has Mr. -Is there a time period
Thomas Rankin
January 5, 2009
135 1
that --
2
Q.
Yes.
3
A.
Okay.
4
Q.
Has Mr. Tipps during 2008 given you or
5
tried to give you any directives insofar as you
6
have been performing services for State Street
7
Partners?
8
A.
9
talking with Fifth Third in trying to facilitate a
The time period is 2008.
Mr. Tipps, from what I know, knew I was
10
refinance.
11
Q.
Was Mr. Tipps part of that process?
12
A.
Eventually Mr. Tipps took the process
13
over from what I understand.
14
Q.
15
discussions about Mr. Tipps taking over that
16
process?
17
A.
18
me Mr. Tipps was taking over that process.
19
Q.
20
as Public Policy Consultants, Incorporated?
21
A.
I know of the entity.
22
Q.
Is that one of your clients?
23
A.
No.
24
Q.
Has it ever been one of your clients?
Did you and Mr. Clark have any
Not that I recall.
Mr. Clark informed
Are you familiar with an entity known
Thomas Rankin
January 5, 2009
136 1
A.
No.
2
Q.
What do you know or understand that
3
entity to be?
4
A.
5
Mr. Tipps.
6
Q.
7
years back that entity transferred all of its
8
assets to State Street Consultants?
9
A.
Yes.
10
Q.
I think you alluded earlier to the
11
asset purchase agreement, did you not?
12
A.
I did.
13
Q.
And you said you've seen that document,
14
you reviewed that document?
15
A.
I have seen it.
16
Q.
Do you know anything else about Public
17
Policy Consultants?
18
A.
19
was a lobbying business.
20
Q.
Do you know if it's still in existence?
21
A.
I don't know if Public Policy
22
Consultants is still in business or existence.
23
Q.
24
Corp., correct?
My understanding is an entity owned by
You know, do you not, that a couple of
I don't know anything else except it
You are familiar with NSC Consulting
Thomas Rankin
January 5, 2009
137 1
A.
Yes.
2
Q.
What do you know that to be?
3
A.
An entity owned by Mr. Clark.
4
Q.
Do you know the nature of its business?
5
A.
A lobbying business.
6
Q.
Do you know if it is actively engaged
7
in the lobbying business?
8
A.
Yes.
9
Q.
For how long have you known NSC
10
Consulting Corp. to be actively engaged in the
11
lobbying business?
12
A.
Since 1986.
13
Q.
Do you know how many clients it
14
currently has?
15
A.
Eight.
16
Q.
Can you name them?
17
A.
No.
18
Q.
Can you name any of them?
19
A.
Yes.
20
Q.
Tell us the ones you can name.
21
A.
Unisys, Washington State University,
22
The Limited, Ohio Nurses Association, Ohio Society
23
of CPAs, Ohio Soft Drink Association.
24
I can remember right now.
That's all
Thomas Rankin
January 5, 2009
138 1
Q.
That's good.
2
A.
Yeah.
3
the ball game.
4
Q.
5
clients throughout 2008?
6
A.
7
each one I listed.
8
Q.
How about 2007?
9
A.
Yes.
10
Q.
How about 2006?
11
A.
Yes.
12
Q.
Did NSC Consulting Corp. have any other
13
clients during 2008?
14
A.
Possibly.
15
Q.
Don't know?
16
That's six out of eight.
If I can only hit well that in Go ahead.
Has it had all of those entities as
I'll have to go back and think about Yes.
MR. GONZALEZ:
I'm sorry.
Objection.
17
He said they were eight and he named six.
18
Q.
19
the eight --
20
I understand that.
MR. GONZALES:
I mean other than
Okay.
21
Q.
22
other clients during 2008?
23
A.
Not that I'm aware of.
24
Q.
Did it have any other clients during
-- did NSC Consulting Corp. have any
Thomas Rankin
January 5, 2009
139 1
2007?
2
A.
Yes.
3
Q.
How many others?
4
A.
I can only recall two.
5
Q.
What are their names?
6
A.
American Cancer Society and American
7
Heart Association.
8
Q.
9
clients during calendar year 2006?
Did NSC Consulting Corp. have any other
10
A.
I can't recall.
11
Q.
How many employees does NSC Consulting
12
Corp. have on the payroll?
13
A.
Zero.
14
Q.
Was that true throughout 2008?
15
A.
Yes.
16
Q.
Was that true throughout 2007?
17
A.
Yes.
18
Q.
Was that true throughout 2006?
19
A.
I don't recall.
20
Q.
Can you ever recall a time when NSC
21
Consulting Corp. had employees on its payroll?
22
A.
Yes.
23
Q.
How far back is that?
24
A.
Can you rephrase that, please?
Thomas Rankin
January 5, 2009
140 1
Q.
2
a time when NSC Consulting Corp. had employees on
3
its payroll.
4
far back was that.
5
A.
1986.
6
Q.
Can you recall any time since 1986 when
7
NSC Consulting Corp. has had employees?
8
A.
9
1993, actually.
Yes, sir.
I asked can you ever recall
You said yes.
Yes.
And I asked you how
And I need to change that to I don't have --
10
Q.
The 1986 to 1993?
11
A.
Yes.
12
Q.
Okay.
13
any time more recently than 1993 when NSC
14
Consulting Corp. has had employees on its payroll?
15
A.
Yes.
16
Q.
When?
17
A.
2005.
2004.
18
Q.
Okay.
So as best you recall, NSC
19
Consulting Corp. had employees on its payroll from
20
1993 through 2005, correct?
21
A.
And possibly 2006.
22
Q.
What individual do you believe might
23
have been an employee of NSC Consulting Corp. in
24
2006?
I'm with you.
2003.
Can you remember
And back.
Thomas Rankin
January 5, 2009
141 1
A.
Lisa Rankin.
2
Q.
Anyone else?
3
A.
Possibly Neil Clark.
4
Q.
Anyone else?
5
A.
Not that I recall.
6
Q.
Are there any books or records of NSC
7
Consulting Corp. that you could consult to
8
ascertain when it last had employees and who those
9
employees were?
10
A.
Yes.
11
Q.
What would you consult?
12
A.
My QuickBooks.
13
Q.
You've told me that NSC Consulting
14
Corp. had no employees in 2008, 2007, and
15
initially you said 2006, but then you said, well,
16
2006, maybe Lisa Rankin was still an employee,
17
maybe Neil Clark was an employee, you weren't
18
sure.
19
reference.
20
So let's start with that frame of
If NSC Consulting Corp. has no
21
employees, how does it render lobbying services to
22
these eight and in some years eight-plus clients
23
that you've said that it has?
24
A.
I don't know.
Thomas Rankin
January 5, 2009
142 1
Q.
2
services that NSC Consulting Corp. as an entity
3
renders to its clients?
4
A.
Yes.
5
Q.
Who are those people?
6
A.
Neil Clark, Andrew Minton, Aaron
7
Ockerman.
8
Q.
Anyone else?
9
A.
Not that I know of.
10
Q.
Those people are all lobbyists for
11
State Street Consultants, correct?
12
A.
As far as I know.
13
Q.
Are all eight of those clients of NSC
14
Consulting Corp. on retainers?
15
A.
Yes.
16
Q.
When the clients of NSC Consulting
17
Corp. make their retainer payments, to what entity
18
do the moneys go?
19
A.
NSC Consulting Corp.
20
Q.
Do the moneys then go into some account
21
of NSC Consulting Corp.?
22
A.
I would presume.
23
Q.
Do the moneys in some fashion or
24
another then flow from NSC Consulting Corp. over
Do you know who actually provides the
Thomas Rankin
January 5, 2009
143 1
to State Street Consultants?
2
A.
Possibly.
3
Q.
Do you know?
4
A.
Yes.
5
Q.
Do they or don't they?
6
A.
Yes.
7
Q.
Tell me how that happens.
8
different question, but we may have to come back
9
to this one.
10
Let me ask a
Does NSC Consulting Corp. pay SSC,
11
meaning State Street Consultants, for the services
12
that State Street Consultants' lobbyists render to
13
NSC Consulting Corp.'s clients?
14
A.
No.
15
Q.
Does State Street Consultants ever
16
receive compensation from anyone for the services
17
that its employees provide to NSC Consulting
18
Corp.'s clients?
19
A.
20
for a second on that, please.
21
Q.
22
receive compensation from anyone for the services
23
that its employees provide to NSC Consulting
24
Corp.'s clients?
As far as I'm aware.
Go back to the beginning.
I lost you
Does State Street Consultants ever
Thomas Rankin
January 5, 2009
144 1
A.
I don't know.
2
Q.
Who would you expect to know that?
3
A.
Mr. Clark.
4
Q.
You are the accountant for both
5
entities, correct?
6
A.
Yes.
7
Q.
And you see the books and records for
8
both entities, correct?
9
A.
Yes.
10
Q.
Can you not tell from the financial
11
books and records of State Street Consultants and
12
NSC Consulting Corp. to which you have access
13
whether NSC Consulting Corp. is paying State
14
Street Consultants for the services that State
15
Street Consultants' employees render to NSC's
16
clients?
17
A.
18
ago.
19
Q.
Well, I don't think so.
20
A.
Okay.
21
Q.
Can you not tell from looking at the
22
books and records?
23
A.
Yes.
24
Q.
Then does NSC Consulting Corp. pay
I thought I answered that two questions
Thomas Rankin
January 5, 2009
145 1
State Street Consultants for the services that
2
State Street Consultants' employees render to NSC
3
Consulting Corp.'s clients?
4
A.
5
couple times ago, regarding SSC employees.
6
Q.
7
receive compensation from anyone for the services
8
that its employees provide to NSC Consulting
9
Corp.'s clients?
No.
That's one I thought I answered a
Does State Street Consultants ever
10
A.
Not that I'm aware of.
11
Q.
It is the case, is it not, that State
12
Street Consultants' employees are paid by State
13
Street Consultants?
14
A.
Yes.
15
Q.
Does NSC Consulting Corp., to your
16
knowledge, make any payments whatsoever to State
17
Street Consultants?
18
A.
Define "payments".
19
Q.
Remittances of moneys for goods or
20
services rendered.
21
A.
No.
22
Q.
Is there any other way you would define
23
payments?
24
A.
I might not define payments any
Thomas Rankin
January 5, 2009
146 1
differently, but you might.
2
say payment.
3
sure that your payment and my payment were the
4
same.
5
Q.
6
given you?
7
A.
It sounds like it.
8
Q.
All right.
A loan, someone might
I have -- so I just wanted to make
Are they, based on the definition I've
9
To your knowledge, do any contracts
10
exist between State Street Consultants and NSC
11
Consulting Corp.?
12
A.
Not to my knowledge.
13
Q.
To your knowledge, does NSC Consulting
14
Corp. ever pay on behalf of State Street
15
Consultants any of State Street Consultants'
16
payment obligations?
17
A.
One more time.
18
Q.
That's all right.
19
does NSC Consulting Corp. ever pay on behalf of
20
State Street Consultants any of State Street
21
Consultants' payment obligations?
22
A.
23 24
I'm sorry. To your knowledge,
Not to my knowledge. MR. WEAVER:
Dan, are you including
salary as part of your question when you say
Thomas Rankin
January 5, 2009
147 1
payment obligations?
2 3
MR. CVETANOVICH:
I didn't mean to
exclude anything.
4
MR. WEAVER:
Okay.
5
Q.
Which member or members of the group --
6
A.
Sorry.
7
Q.
That's all right.
8
A.
Bad -- bad taste.
9
Q.
All right.
Which member or members of
10
the group as we defined that earlier pay the fees
11
of your firm?
12
A.
NSC Consulting Corp.
13
Q.
Is the amount that you are paid then
14
allocated among the entities and persons for whom
15
your company provides services pursuant to the
16
retainer?
17
A.
I treat them, and have, as one group.
18
Q.
You've done that for how long?
19
A.
The group as a whole since 2006.
20
Q.
Does Neil Clark receive compensation in
21
any form from State Street Consultants?
22
A.
No.
23
Q.
Money.
24
A.
Yes.
You need to define "compensation". Does he receive money --
Thomas Rankin
January 5, 2009
148 1
Q.
2
Consultants?
3
A.
Yes.
4
Q.
In what form?
5
A.
Distribution.
6
Q.
Anything else?
7
A.
No.
8
Q.
Does Mr. Clark receive compensation or
9
money in any form from NSC Consulting Corp.?
-- in any form from State Street
10
A.
Yes.
11
Q.
In what form does he receive
12
compensation from NSC Consulting Corp.?
13
A.
He receives money through distribution.
14
Q.
So is it the case, Mr. Rankin, that
15
from neither of those two entities does Mr. Clark
16
receive a salary?
17
A.
18
that -- the term "salary," no salary.
19
Q.
20
hourly wages?
21
A.
No.
22
Q.
Does he receive any bonus payments?
23
A.
No.
24
Q.
Does he receive any retainer payments?
A salary in the term that you and I or
Does he receive compensation based upon
Thomas Rankin
January 5, 2009
149 1
A.
No.
2
Q.
Does he receive expense reimbursement
3
from either of those two entities?
4
A.
Not that I'm aware of.
5
Q.
Do either of those two entities provide
6
Mr. Clark any in-kind compensation or
7
remuneration?
8
A.
Yes.
9
Q.
What types of in-kind compensation or
10
remuneration does Mr. Clark receive from either
11
State Street Consultants or NSC Consulting Group?
12
A.
13
insurance premiums; expenses that are not
14
deductible for business purposes is treated as
15
remuneration.
16
Q.
Anything else?
17
A.
Not that I'm aware of.
18
Q.
Which entity pays the premiums on
19
Mr. Clark's disability insurance?
20
A.
NSC Consulting Corporation.
21
Q.
Do you know what those amount to per
22
month or per quarter?
23
A.
900 a month, maybe.
24
Q.
Which entity pays Mr. Clark's life
Disability insurance coverage, life
Thomas Rankin
January 5, 2009
150 1
insurance premiums?
2
A.
3
insurance premiums and NSC Consulting has paid
4
life insurance premiums.
5
Q.
On the same policy?
6
A.
Possibly.
7
Q.
How many policies of life insurance
8
exist on Mr. Clark's life, the premiums of which
9
are paid by one or both of these entities?
State Street Consultants has paid life
10
A.
11
or both.
12
Q.
13
the premiums on a certain policy and the other
14
entity pays for the premiums on a different
15
policy?
16
A.
17
I don't keep track of which premiums are paid on
18
which policy.
19
Q.
20
policies?
21
A.
22
the owner of some policy -- several policies.
23
Q.
All four?
24
A.
And Paul Tipps is an owner of a policy
Some of the premiums may be paid by one Four policies, possibly. Is it the case that one entity pays for
I've never looked at that specifically.
Do you know who are the owners of the
My recollection is that Neil Clark is
Thomas Rankin
January 5, 2009
151 1
also.
2
Q.
Does that account for the four?
3
A.
Kathy Clark is an owner of a policy.
4
Q.
How many have we accounted for now?
5
A.
Five, possibly.
6
Q.
Okay.
7
owner of one policy on the life of Neil Clark?
8
A.
Yes.
9
Q.
You believe Kathy Clark is the owner of
You believe Paul Tipps is the
10
one policy on the life of Neil Clark?
11
A.
Correct.
12
Q.
And you believe that Mr. Clark himself
13
is the owner of the other several policies on his
14
life?
15
A.
Correct.
16
Q.
And the premiums of all of those
17
policies are paid by one or another of these two
18
entities?
19
A.
20
Kathy Clark's policy.
21
Q.
22
premium on the policy that Mr. Tipps owned?
23
A.
State Street Consultants.
24
Q.
Do you know if that policy is current?
I don't recall who pays the premium on
Do you recall which entity paid the
Thomas Rankin
January 5, 2009
152 1
A.
I don't.
2
Q.
Do you know if at a point State Street
3
Consultants ceased to pay the premiums on that
4
policy?
5
A.
I heard that.
6
Q.
From whom did you hear that?
7
A.
Neil Clark.
8
Q.
When did he tell you that?
9
A.
November.
10
Q.
Did he tell you who determined to have
11
State Street Consultants cease paying the premiums
12
on that insurance policy?
13
A.
14 15
I don't recall who determined that. THE VIDEOGRAPHER:
Mr. Cvetanovich,
you've got about four minutes left.
16
MR. CVETANOVICH:
Thank you, Jeremy.
17
Q.
18
those agreements that you told us earlier you had
19
reviewed Mr. Clark has an obligation to pay the
20
premiums on that policy on his life for the
21
benefit of Mr. Tipps?
22
A.
23
sorry.
24
Q.
Do you know that pursuant to one of
You have to rephrase that for me.
Certainly.
I'm
Do you know that pursuant
Thomas Rankin
January 5, 2009
153 1
to one of those agreements that you told us
2
earlier you had reviewed Mr. Clark has an
3
obligation to pay the premiums on that policy on
4
his life for the benefit of Mr. Tipps?
5
A.
6
agreement.
7
Q.
8
Consultants had been paying the premiums on that
9
policy up until this point in November or
I'm not aware of that part of
Do you know why State Street
10
thereabouts when Mr. Clark told you State Street
11
Consultants would no longer pay those premiums?
12
A.
No.
13
Q.
Do you know if State Street Consultants
14
continues to pay the premiums on others of the
15
policies on the life of Mr. Clark?
16
A.
17
insurance premium payment since November.
18
were referring back to the November date.
19
Q.
So the answer is you don't know?
20
A.
I don't know.
21
back to the November date.
22
Q.
23
disability insurance premiums and life insurance
24
premiums paid by one or another of these entities.
I don't know if there has been an You
If you were referring
You've told me that Mr. Clark had
Thomas Rankin
January 5, 2009
154 1
Did he also have health insurance premiums paid
2
for him by one or the other of State Street
3
Consultants and NSC Consulting Corp.?
4
A.
Yes.
5
Q.
Which of the entities paid his health
6
insurance premiums?
7
A.
State Street Consultants.
8
Q.
For how long has that been the case?
9
A.
I don't recall exactly.
10
Q.
Does that continue to be the case?
11
A.
Yes.
12
Q.
Are there any other items of in-kind
13
compensation or remuneration that Mr. Clark
14
receives either from State Street Consultants or
15
from NSC Consulting Corp.?
16
A.
17
potentially.
18
Q.
19
paid for Mr. Clark by either State Street
20
Consultants or NSC Consulting Corp.
21
A.
22
expenses are, but --
23
Q.
Do you know any of them?
24
A.
Personal use of meals at New Albany
Not -- nonbusiness expenses,
Tell me what nonbusiness expenses are
I don't know specifically what the
Thomas Rankin
January 5, 2009
155 1
Country Club.
2
recall that one specifically.
3
Q.
Any others?
4
A.
I can't remember others.
5 6
I can recall that.
THE VIDEOGRAPHER:
Or -- I can
We're going to have
to change.
7
MR. CVETANOVICH:
Go ahead, Jeremy.
8
THE VIDEOGRAPHER:
We are off the
9
record at 1507.
10
(A brief recess is taken.)
11
THE VIDEOGRAPHER:
We are back on the
12
record at 1514.
13
Q.
14
State Street Consultants have a 401(k) plan for
15
its employees?
16
A.
Yes.
17
Q.
Is it the case that State Street
18
Consultants' employees can determine for
19
themselves whether they will be participants in
20
the plan?
21
A.
That's what I understand.
22
Q.
And do they get to determine within
23
limits set by the plan how much they will have
24
withheld from their paychecks to contribute to the
Mr. Rankin, to your knowledge, does
Thomas Rankin
January 5, 2009
156 1
plan?
2
A.
Yes.
3
Q.
Does State Street Consultants, in fact,
4
withhold 401(k) contributions from the paychecks
5
of those employees who choose to participate in
6
the plan?
7
A.
That's my understanding.
8
Q.
And when State Street Consultants
9
withholds 401(k) contributions from employee
10
paychecks, what does it then do with the money?
11
A.
12
fund holder, whatever you want to call it.
13
Q.
Custodian, can we use that term?
14
A.
Good term.
15
Q.
All right.
16
within which those withheld 401(k) contributions
17
have to be remitted to the custodian?
18
A.
I'm sure there is.
19
Q.
Do you know what it is?
20
A.
I don't exactly.
21
Q.
Do you know approximately?
22
A.
Guess?
23
Q.
If you know or as much as you know.
24
A.
My guess is it's 30 days after the --
Remit to the 401(k) administrator or
Is there a time limit
Thomas Rankin
January 5, 2009
157 1
the payroll date, or 30 days after the month ended
2
that the payroll occurred.
3
Q.
4
withheld from employee paychecks to go into their
5
401(k) accounts, State Street Consultants doesn't
6
get to hang on to that money indefinitely,
7
correct?
8
A.
Correct.
9
Q.
And it doesn't get to use that money.
Whichever way that is, when moneys are
10
That's the employees' money, correct?
11
A.
It's the custodian's money.
12
Q.
All right.
13
money for the benefit of the plan participants,
14
correct?
15
A.
Yes.
16
Q.
To your knowledge, have there been
17
instances when State Street Consultants has been
18
delinquent in remitting the employee withholdings
19
to the 401(k) plan custodian?
20
A.
I don't know.
21
Q.
Are there documents to which you could
22
refer that would tell you the answer to that
23
question?
24
A.
Yes.
The custodian holding that
Thomas Rankin
January 5, 2009
158 1
Q.
What documents?
2
A.
I would need to review the law, so I
3
would need the Internal Revenue Code.
4
need the specific payroll dates, and I would need
5
the amounts withheld on those specific dates to
6
properly determine if State Street Consultants was
7
indeed late.
8
Q.
9
State Street Consultants would be late in
I would
Do you know whether in instances where
10
remitting withheld 401(k) contributions it would
11
get some kind of a reminder from the 401(k)
12
service company used by State Street Consultants?
13
A.
I don't know if that occurs.
14
Q.
What is the process for remittance of
15
moneys withheld from employee paychecks to be
16
contributed to the 401(k) plan?
17
A.
18
for State Street Consultants.
19
Q.
20
whatsoever?
21
A.
No.
22
Q.
Do you determine when remittances are
23
due to the 401(k) plan custodian?
24
A.
Ms. Harrison takes care of that process
Do you have any role in that process
No.
Thomas Rankin
January 5, 2009
159 1
Q.
2
discussions with employees of State Street
3
Consultants regarding its periodic delinquency in
4
remitting the funds withheld from employee
5
paychecks for 401(k) contributions?
6
A.
7
there because I don't know if they're delinquent
8
payments or not.
9
Q.
Have you been a party to any
I have to put the word "perceived" in
But you've been a party to such
10
discussions?
11
A.
Yes.
12
Q.
With whom?
13
A.
Aaron Ockerman, Andrew Minton.
14
Q.
Anyone else?
15
A.
Not that I can recall.
16
Q.
Did you speak with the two of those
17
gentlemen together or one at a time?
18
A.
I don't recall.
19
Q.
What conversation did you have with
20
Mr. Minton about that?
21
A.
22
401(k) contribution was not paid timely.
23
Q.
What did you say to him in response?
24
A.
Check with Mr. Clark.
Mr. Minton thought or perceived his
Thomas Rankin
January 5, 2009
160 1
Q.
2
with Mr. Minton about that?
3
A.
Not that I recall.
4
Q.
What discussion did you have with
5
Mr. Ockerman about a perceived delinquency in
6
State Street Consultants remitting his withheld
7
401(k) contributions to the custodian?
8
A.
Same as Mr. Minton's.
9
Q.
Did you give the same --
10
A.
In that context.
11
Q.
Excuse me.
12
response to Mr. Ockerman?
13
A.
Yes.
14
Q.
Did you have any further discussions
15
with him about that?
16
A.
Not that I recall.
17
Q.
Do you know of any other employees of
18
State Street Consultants who had the perception
19
that their withheld 401(k) moneys were not being
20
paid into the plan on a timely basis?
21
A.
22
perception.
23
perception.
24
Q.
Did you have any further discussion
Did you give the same
I'm not sure if anyone else had that I don't know if anyone else had that
Are you familiar with an entity known
Thomas Rankin
January 5, 2009
161 1
as Paychex?
2
A.
Yes.
3
Q.
What is Paychex?
4
A.
A payroll service company.
5
Q.
Is that a payroll service company that
6
State Street Consultants uses?
7
A.
8
called Paycor, and I often -- I have some
9
with Paycor also, so --
I think so.
There's another interest clients
10
Q.
11
Consultants uses the services of one or the other
12
of those two entities?
13
A.
Yes.
14
Q.
You're just not sure which is the
15
proper name; is that correct?
16
A.
There's a "pay" in front.
17
Q.
But you know it's one of the two?
18
A.
Yes.
19
Q.
Are you aware that at a point in time
20
State Street Consultants utilized a service
21
offered by that payroll services company called
22
Taxpay?
23
A.
Yes.
24
Q.
Do you know if State Street Consultants
Do you know that State Street
Thomas Rankin
January 5, 2009
162 1
continues to use that service offered by this
2
payroll services company?
3
A.
No.
4
Q.
No, it does not?
5
A.
It does not use Taxpay.
6
Q.
Would you explain to us, please, what
7
the Taxpay service is.
8
A.
9
from an employer account and places the funds in
Paycor or -chex withdraws the funds
10
escrow until taxes, those withholdings, are due to
11
particular agencies.
12
Q.
13
company make the remittances to the taxing
14
authorities?
15
A.
Yes.
16
Q.
Do you recall when State Street
17
Consultants stopped using that service of its
18
payroll services company?
19
A.
December of 2006.
20
Q.
Do you know who made the decision that
21
State Street Consultants would cease to use that
22
service?
23
A.
Mr. Clark.
24
Q.
Did you make a recommendation to
And then does the payroll services
Thomas Rankin
January 5, 2009
163 1
Mr. Clark in respect of whether State Street
2
Consultants should continue to use that service?
3
A.
Not a recommendation.
4
Q.
Did you consult with him about that
5
decision?
6
A.
Yes.
7
Q.
Tell me what discussions you had with
8
Mr. Clark about that.
9
A.
Mr. Clark was informed that he can
10
pay -- he can pay payroll taxes not using the
11
Taxpay service.
12
Q.
Informed by whom?
13
A.
Informed by me.
14
Q.
Is it your understanding that when so
15
informed by you that was the first time that
16
Mr. Clark had become aware of that?
17
A.
No.
18
Q.
Is it something that he had known
19
before you and he discussed it?
20
A.
Yes.
21
Q.
What discussion did you and he then
22
have about whether that was a desirable service
23
for State Street Consultants to utilize?
24
A.
Can you repeat the question, please?
Thomas Rankin
January 5, 2009
164 1
Q.
2
understand how this decision came about to stop
3
using the Taxpay service offered by the payroll
4
services company.
5
A.
Sure.
6
Q.
What discussion did you and Mr. Clark
7
have about pros and cons that culminated in him
8
making the decision to discontinue the service?
9
A.
A pro is --
10
Q.
I understand -- excuse me.
11
for interrupting, but I want to know what you and
12
he discussed, not what occurs to you today, but
13
what did you and he discuss?
14
A.
15
escrow and payments are made for you.
16
those funds are removed from your account up to
17
seven days in advance of when they are due.
18
Q.
19
else?
20
A.
21
to pay payroll taxes using either method.
22
Q.
23
Are you saying that your advice to Mr. Clark was
24
either is fine?
Certainly.
I'm just trying to
I apologize
A pro is the withholdings are placed in A con is
Did you and Mr. Clark discuss anything
My advice is to -- or was to continue
I need to be sure I understand that.
Thomas Rankin
January 5, 2009
165 1
A.
2
tax pay service or not.
3
Q.
Did you recommend one over the other?
4
A.
I may have told Mr. Clark there is a
5
different payroll service fee structure, but that
6
may be minimal.
7
Q.
8
because you just said, I may have told him that.
9
Do you remember telling him that?
Either is totally acceptable, to use a
Now, do you remember telling him that,
10
A.
Yes.
11
Q.
And after telling him that, did you
12
ground a recommendation, in part, on that
13
difference?
14
A.
No.
15
Q.
What ultimately did you recommend to
16
Mr. Clark or advise Mr. Clark that State Street
17
Consultants ought to do?
18
A.
Pay their taxes.
19
Q.
Of course you would advise that, but
20
did you recommend that he continue to do it
21
through the use of the Paychex Taxpay service or
22
Paycor Taxpay service, whichever that is, or did
23
you instead recommend that State Street
24
Consultants do that for itself?
Thomas Rankin
January 5, 2009
166 1
A.
2
both acceptable ways to pay your tax.
3
Q.
4
discontinue using the Taxpay service, correct?
5
A.
Yes.
6
Q.
It's true, is it not, that he
7
determined to discontinue the use of that service
8
so that State Street Consultants could hang on to
9
the employees' money a little longer, correct?
I don't recall my recommendation of
What Mr. Clark ultimately did was to
10
A.
11
remit the funds closer to the due date.
12
Q.
Later?
13
A.
Yes.
14
Q.
Okay.
15
hanging on to the money a little longer, right?
16
A.
17
Holding, maybe.
18
Q.
And using, correct?
19
A.
I don't know if he specifically used
20
that for --
21
Q.
22
ability of State Street Consultants if it would
23
hang on to that money longer being able to use
24
that money?
So that State Street Consultants could
And that's the same thing as
Hanging on is a relative term.
Did you and Mr. Clark talk about the
Thomas Rankin
January 5, 2009
167 1
A.
2
the money would not be there to take out in the
3
first place.
4
Q.
5
withheld from employee paychecks?
6
A.
7
cover payroll.
8
Q.
9
discontinuing use of the Taxpay service as a way
Mr. Clark was concerned possibly that
Why would that be if the money is
There may not have been enough money to
So is it the case that Mr. Clark saw
10
to defer the point in time when State Street
11
Consultants had to be able to cover its payroll?
12
A.
Possibly.
13
Q.
Did he discuss that with you?
14
A.
Yes.
15
Q.
Did he say that to you?
16
A.
I don't recall specifically him saying
17
that.
18
Q.
19
something he felt would be desirable about
20
discontinuing use of the Taxpay service?
21
A.
Yes.
22
Q.
Are you aware of any person who has
23
ever received a paycheck from State Street
24
Consultants but who was not at that time an
But did you understand that that was
Thomas Rankin
January 5, 2009
168 1
employee of State Street Consultants?
2
A.
3
paycheck was an employee.
4
Q.
Does that mean you don't know?
5
A.
Everybody would have been an employee.
6
Q.
Let me ask a little bit different
7
question.
Are you aware of any persons who were
8
reflected as employees on the payroll records of
9
State Street Consultants and who, in fact,
I would presume anybody who got a
10
received paychecks from State Street Consultants
11
but who did not provide services to State Street
12
Consultants or its clients?
13
A.
14
all of State Street Consultants' employees.
15
Q.
16
notwithstanding, do you know of any instance when
17
someone was reflected as a payroll[sic] on the
18
payroll records, received a paycheck, but was not
19
then currently providing services to State Street
20
Consultants or its clients?
21
A.
To the best of my knowledge, no.
22
Q.
Do you know whether -- well, let me
23
start my question over.
24
I don't know, nor do I keep track of,
That's certainly fair enough, but that
Do you know a person named Brittany
Thomas Rankin
January 5, 2009
169 1
Clark?
2
A.
Yes.
3
Q.
Who do you understand Brittany Clark to
4
be?
5
A.
Neil Clark's daughter.
6
Q.
Do you know whether Brittany Clark has
7
ever been an employee of State Street Consultants?
8
A.
Yes.
9
Q.
Do you know during what periods of time
10
she's been an employee of State Street
11
Consultants?
12
A.
2008.
13
Q.
Any other periods of time?
14
A.
Not that I'm aware of.
15
Q.
During what portions of 2008 has
16
Brittany Clark been an employee of State Street
17
Consultants?
18
A.
Six months, maybe.
19
Q.
Which part of the year?
20
A.
Latter.
21
Q.
Do you know what her position is with
22
State Street Consultants?
23
A.
No.
24
Q.
Do you know what her job duties are for
Thomas Rankin
January 5, 2009
170 1
State Street Consultants?
2
A.
No.
3
Q.
Is she someone who over the course of
4
the past six months you would see regularly at the
5
offices of State Street Consultants?
6
A.
No.
7
Q.
You do know that she's a full-time
8
college student, correct?
9
A.
Yes.
10
Q.
And you do know that she's attending
11
college in Boston, correct?
12
A.
Yes.
13
Q.
Do you know whether during the period
14
of time when she's been away at college in Boston
15
Brittany Clark has been carried as an employee on
16
the payroll records of State Street Consultants
17
and receiving paychecks from State Street
18
Consultants?
19
A.
20
during her time in -- can you repeat that?
21
sorry.
22
Q.
23
of time when she's been away at college in Boston,
24
Brittany Clark has been carried as an employee on
I almost forgot the question.
But I'm
Do you know whether during the period
Thomas Rankin
January 5, 2009
171 1
the payroll records of State Street Consultants
2
and receiving paychecks from State Street
3
Consultants?
4
A.
Yes.
5
Q.
Do you know why that is?
6
A.
No.
7
Q.
Do you know who made the determination
8
to pay Brittany Clark as an employee,
9
notwithstanding that she was away at college?
10
A.
Mr. Clark.
11
Q.
Do you know if anyone else participated
12
in that decision?
13
A.
Not that I'm aware of.
14
Q.
Have you had a discussion with anyone
15
about that?
16
A.
Not that I remember.
17
Q.
Never talked with Mr. Clark about that?
18
A.
He did inform me he was employing
19
Brittany.
20
Q.
21
continue to pay her after she went away to
22
college?
23
A.
24
that or not.
Did he inform you that he was going to
I don't recall if he informed me of
Thomas Rankin
January 5, 2009
172 1
Q.
2
that?
3
A.
Not that I recall.
4
Q.
Did you express any concerns or
5
reservations about that state of affairs to
6
Mr. Clark?
7
A.
No.
8
Q.
Have you expressed any concerns or
9
reservations about that state of affairs to anyone
Have you talked with anyone else about
10
else?
11
A.
No.
12
Q.
Are you concerned about that?
13
A.
I am not concerned to the extent
14
Ms. Clark is performing services.
15
Q.
16
performing services for State Street Consultants
17
while she's away at college in Boston?
18
A.
I don't have knowledge of that.
19
Q.
Have you inquired about that?
20
A.
No.
21
Q.
Has anyone represented to you that
22
Brittany Clark is providing services to State
23
Street Consultants while she is away in Boston
24
going to college?
Do you have knowledge that she is
Thomas Rankin
January 5, 2009
173 1
A.
No.
2
Q.
If Ms. Clark is not, in fact,
3
performing services for State Street Consultants
4
but is receiving a paycheck from them, would that
5
give you concern?
6
A.
Possibly.
7
Q.
Why possibly?
8
A.
Yes.
9
Q.
That would trouble you, would it not?
10
A.
I don't -- yeah.
11
Q.
You know that wouldn't be right, true?
12
A.
Right.
13
Q.
And if you knew that were going on,
14
wouldn't you have a discussion with Mr. Clark
15
about that?
16
A.
Yes.
17
Q.
And would you counsel him that he
18
shouldn't be doing that?
19
A.
Yes.
20
Q.
Do you know of anyone else who has been
21
carried as a payroll on the payroll records --
22
excuse me.
23 24
Yes.
Let me start over.
I misspoke.
Do you know anyone else who has been carried as an employee on the payroll records of
Thomas Rankin
January 5, 2009
174 1
State Street Consultants and who has received
2
paychecks from State Street Consultants where
3
there is some question about whether they're
4
providing services to State Street Consultants or
5
its clients?
6
A.
Yes.
7
Q.
What other employees or nominal
8
employees?
9
A.
Sam Moore, Colleen Lora.
I think
10
that's all.
11
Q.
12
correct?
13
A.
Woman friend.
14
Q.
All right.
15
A.
She's of age.
16
Q.
Okay.
17
How old a woman is she?
18
A.
I'm sorry?
19
Q.
How old a woman is she?
20
A.
I don't know.
21
Q.
How long, to your knowledge, have she
22
and Mr. Clark been seeing each other?
23
A.
Two years, possibly.
24
Q.
And they're living together, correct?
Colleen Lora is Mr. Clark's girlfriend,
I've never met Ms. --
I won't ask you of age for what.
Thomas Rankin
January 5, 2009
175 1
A.
That's my understanding.
2
Q.
Do you know how long they've been
3
living together?
4
A.
I don't.
5
Q.
She was formerly an employee there,
6
right?
7
MR. GONZALEZ:
Objection.
8
Q.
You may respond.
9
A.
I think she still is.
10
Q.
Once upon a time, she was, in fact,
11
regularly providing services to State Street
12
Consultants and its clients, correct?
13
A.
She was doing that at that time.
14
Q.
Okay.
15
ago, right?
16
A.
I don't know.
17
Q.
Well, from where you sit, it is no
18
longer apparent that she is regularly performing
19
services for State Street Consultants or its
20
employees, correct?
21
A.
I don't see her in the office much.
22
Q.
But you know she's still getting a
23
paycheck, right?
24
A.
Yes.
But that period ended some time
Thomas Rankin
January 5, 2009
176 1
Q.
Does that concern you or trouble you?
2
A.
If she's not performing services, that
3
would be.
4
Q.
5
that?
6
A.
Yes.
7
Q.
What did you say to him about that?
8
A.
That employees need to provide
9
services.
Have you talked with Mr. Clark about
10
Q.
When did you have that conversation?
11
A.
I don't recall.
12
Q.
Was it within the past six months?
13
A.
Possibly.
14
Q.
Probably?
15
A.
Maybe.
16
Q.
Do you have any way of pinning down how
17
recently you had that discussion with Mr. Clark?
18
A.
19
that conversation was.
20
Q.
21
frame when you stopped seeing Ms. Lora in the
22
office regularly?
23
A.
24
stopped seeing her in the office.
I really don't remember exactly when
Can you tell me the approximate time
I don't remember specifically when I
Thomas Rankin
January 5, 2009
177 1
Q.
2
not?
3
A.
Possibly, yes.
4
Q.
Okay.
5
up with Mr. Clark and said, you know, if she's not
6
working here, she shouldn't be getting a paycheck,
7
how did he react to that?
8
A.
I'm sure he took it under advisement.
9
Q.
Did he say anything in response?
10
A.
Not that I recall.
11
Q.
Did he say he would get back to you?
12
A.
No.
13
Q.
Did he tell you to butt out and mind
14
your own business?
15
A.
I don't recall that.
16
Q.
Did he seem to appreciate you bringing
17
the topic up with him?
18
A.
Yes.
19
Q.
Now, you've said that he took it under
20
advisement.
21
communicated to you that he took it under
22
advisement?
23
A.
"I'll take that under advisement."
24
Q.
That's what he said?
It's been quite some time now, has it
Now, when you took that subject
What was it that he said or did that
Thomas Rankin
January 5, 2009
178 1
A.
Yes.
2
Q.
Okay.
3
get back to you after he had considered it
4
further?
5
A.
No.
6
Q.
He hasn't gotten back to you, right?
7
A.
No.
8
Q.
I threw a couple words in there that
9
confused the question.
Did he tell you that he would
It is true, is it not,
10
that he hasn't gotten back to you?
11
A.
Yes.
12
Q.
And she's still on the payroll,
13
correct?
14
A.
As far as I know.
15
Q.
Have you gone back to Mr. Clark and
16
said, Mr. Clark, or, Neil, you took this under
17
advisement, have you reached a conclusion yet?
18
A.
No.
19
Q.
Have you talked with anyone else about
20
that state of affairs?
21
A.
22
I don't think so. MR. WEAVER:
Objection.
Can we make
23
sure that the questions about who he talked to
24
does not include either his spouse or his
Thomas Rankin
January 5, 2009
179 1
attorney, nonprivileged conversations?
2
MR. CVETANOVICH:
3
MR. WEAVER:
4
MR. CVETANOVICH:
I will do that.
Thank you. Yes.
I'll work
5
around that, Mark.
6
Q.
7
in any lobbying services outside of State Street
8
Consultants or NSC Consulting Corp.?
9
A.
Not that I'm aware of.
10
Q.
Do you know whether Mr. Clark has
11
created a new entity through which he is doing or
12
plans to do lobbying work?
13
A.
Not that I'm aware of.
14
Q.
Has he told you that he has a plan of
15
doing that?
16
A.
A plan of doing -- can you repeat that?
17
Q.
Yes.
18
activities other than through an entity other than
19
State Street Consultants and NSC Consulting Corp.?
20
A.
Possibly.
21
Q.
When did he tell you that?
22
A.
Within the past 30 days.
23
Q.
Did he tell you when he hoped that new
24
entity would be operational?
Do you know whether Mr. Clark engages
A plan of conducting lobbying
Thomas Rankin
January 5, 2009
180 1
A.
2
operational, not that I recall.
3
Q.
4
doing business through the new entity?
5
A.
No.
6
Q.
Did he tell you whether he planned to
7
take or try to take clients of State Street
8
Consultants over to his new entity?
9
A.
No.
10
Q.
Did he tell you that he planned to take
11
or to try to take clients of NSC Consulting Corp.
12
over to the new entity?
13
A.
No.
14
Q.
Mr. Clark tell you that he planned to
15
invite employees of State Street Consultants to
16
join him in the new entity?
17
A.
Can you repeat that?
18
Q.
Certainly.
19
A.
Okay.
20
Q.
Did Mr. Clark tell you that he planned
21
to invite employees of State Street Consultants to
22
join him in the new entity?
23
A.
Yes.
24
Q.
Did he tell you which employees?
When the new entity would be
Did he tell you when he hoped to start
Thank you.
Thomas Rankin
January 5, 2009
181 1
A.
Yes.
2
Q.
Which ones?
3
A.
Aaron Ockerman, Andrew Minton, John
4
Singleton, and I think that's all.
5
Q.
6
extend that invitation to them?
7
A.
No.
8
Q.
To your knowledge, has he done so yet?
9
A.
Yes.
10
Q.
Has he invited each of them to leave
11
State Street Consultants and join his new entity?
12
A.
A new entity.
13
Q.
Has he invited all of them to leave and
14
join a new entity?
15
A.
I don't recall.
16
Q.
Which ones has he invited to leave
17
State Street Consultants and join a new entity?
18
A.
19
Singleton.
20
Q.
Can you think of any others?
21
A.
No.
22
Q.
Do you know if Aaron Ockerman has yet
23
responded to Mr. Clark's invitation to join a new
24
entity?
Did he tell you when he planned to
No.
Aaron Ockerman, Andrew Minton, John
Thomas Rankin
January 5, 2009
182 1
A.
Not that I'm aware of.
2
Q.
Do you know if Andrew Minton has yet
3
responded to Mr. Clark's invitation to join a new
4
entity?
5
A.
Not that I'm aware of.
6
Q.
Do you know if John Singleton has yet
7
responded to Mr. Clark's invitation to join a new
8
entity?
9
A.
Not that I'm aware of.
10
Q.
Do you know if Mr. Clark has invited
11
anyone other than those three persons to join him
12
in a new entity that will provide lobbying
13
services?
14
A.
15
Jones.
16
Q.
17
have yet given Mr. Clark a response to his
18
invitation to join a new entity?
19
Lisa Rankin.
Jane Harrison.
Elizabeth
That's all I remember. Do you know if any of those persons
MR. WEAVER:
Objection.
I want to
20
instruct the witness to not provide any answers
21
that are gained from conversations within the
22
spousal privilege.
23
MR. CVETANOVICH:
24
MR. WEAVER:
Fair enough.
Thank you.
Thomas Rankin
January 5, 2009
183 1
You may answer as long as you're not
2
discussing any information you gained within
3
conversations between you and your spouse.
4
A.
What was the question again?
5
Q.
The question is:
6
those persons have yet given Mr. Clark a response
7
to his invitation to join a new entity?
8
persons, this may help you, were Lisa Rankin, Jane
9
Harrison, Elizabeth Jones.
10 11
MR. CVETANOVICH: untranslatable here. MR. WEAVER:
13
MR. CVETANOVICH:
15
And those
I have an
Is that all of them?
12
14
Do you know if any of
May I make a suggestion? You may, but then we
have to read his question over again, you realize. MR. WEAVER:
If you could ask the
16
question first with Lisa, and then ask the
17
question again without Lisa?
18
MR. CVETANOVICH:
19
MR. WEAVER:
20
That allows him to pay
attention to the spousal privilege for the one.
21
MR. CVETANOVICH:
22
MR. WEAVER:
23 24
Sure.
Sure.
And not necessarily pay
attention to the spousal privilege -MR. CVETANOVICH:
I'm happy to do it
Thomas Rankin
January 5, 2009
184 1
that way.
2
Q.
3
responded to Mr. Clark's invitation from any
4
informational source other than having heard it
5
from Lisa herself, tell me.
6
A.
No.
7
Q.
All right.
8
side and stick with the other persons on the list.
9
Now I've got to find the list again.
If you know whether Lisa Rankin has yet
Now, let's set Lisa to one
Jane
10
Harrison and Elizabeth Jones.
11
either of those persons has yet responded to
12
Mr. Clark's invitation to join them in a new
13
lobbying entity?
14
A.
No.
15
Q.
Do you know whether Mr. Clark has a
16
target date for these folks to join him in a new
17
entity?
18
A.
I don't know if there's a target date.
19
Q.
Has Mr. Clark invited your company,
20
Thomas A. Rankin & Associates, to provide
21
accounting services to the new entity that he's
22
creating?
23
A.
24
doing accounting services.
Do you know if
He's -- no one has approached me about
Thomas Rankin
January 5, 2009
185 1
Q.
2
did you take it as implicit that he wants you to
3
continue to be the accountant for his company?
4
A.
For a company, yes.
5
Q.
I take it you would be happy to do
6
that?
7
A.
Another client?
8
Q.
Yes.
9
A.
Yes.
10
Q.
Do you know how much Mr. Clark has
11
received in distributions from State Street
12
Consultants in 2008?
13
A.
I don't recall exactly.
14
Q.
Do you have a range in your mind?
15
A.
Yes.
16
Q.
What's the range?
17
A.
500 to -- well, let me take that back.
18
400 to 600,000.
19
Q.
20
distributions from State Street Consultants in
21
2007?
22
A.
I don't recall that.
23
Q.
Do you have a range?
24
A.
500 to 700,000.
From your conversation with Mr. Clark,
And how much did he receive in
Thomas Rankin
January 5, 2009
186 1
Q.
How about 2006?
2
A.
600 to 800,000.
3
Q.
Now let's switch over from State Street
4
Consultants to NSC Consulting Corp.
5
A.
Uh-huh.
6
Q.
Do you know how much Mr. Clark has
7
received in distributions from NSC Consulting
8
Corp. in 2008?
9
A.
Not exactly.
10
Q.
Do you have a range in your mind?
11
A.
250 to 350,000.
12
Q.
Do you know how much Mr. Clark received
13
in distributions from NSC Consulting Corp. in
14
2007?
15
A.
300 to 400,000.
16
Q.
Can you tell us how much Mr. Clark
17
received in distributions from NSC Consulting
18
Corp. in 2006?
19
A.
Not exactly.
20
Q.
Do you have a range in your mind?
21
A.
350 to 400,000.
22
Q.
In the past three years, has any
23
portion of NSC's -- let me say NSC Consulting
24
Corp.'s revenues been paid to State Street
Thomas Rankin
January 5, 2009
187 1
Consultants?
2
A.
Not that I recall.
3
Q.
During the past three years, have any
4
portion of NSC Consulting Corp.'s revenues been
5
paid to Paul Tipps?
6
A.
Not that I recall.
7
Q.
Do you know if State Street Consultants
8
gave State Street Partners notice of termination
9
of the lease on the 137 East State Street
10
premises?
11
A.
I heard that they did.
12
Q.
From whom did you hear that?
13
A.
Neil Clark.
14
Q.
When did you hear that from Mr. Clark?
15
A.
December 1st.
16
Q.
Did you ever see the notice?
17
A.
Not that I recall.
18
Q.
Did Mr. Clark ever discuss with you why
19
State Street Consultants would be moving its
20
offices from 137 East State Street?
21
A.
Yes.
22
Q.
What did he tell you?
23
A.
The cost of the offices, the office, at
24
137 East State Street was too high.
Thomas Rankin
January 5, 2009
188 1
Q.
2
that your understanding?
3
A.
Yes.
4
Q.
Do you know of anything that Mr. Clark
5
or anyone else has done on behalf of State Street
6
Partners to find replacement tenants for 137 East
7
State Street?
8
A.
Yes.
9
Q.
Tell us what you know about that.
10
A.
There have been advertisements in
11
papers, local newspapers.
12
contract.
13
or whatever -- has been hired to assist in finding
14
a tenant for selling the building on several
15
occasions.
16
Q.
Anything else?
17
A.
Go back to the question, please, again.
18
Q.
Yes.
19
anything that Mr. Clark or anyone else has done on
20
behalf of State Street Partners to find
21
replacement tenants for 137 East State Street?
22
A.
Yes.
23
Q.
Well, you did say "yes," and you did
24
give me two examples.
So he went to find cheaper space; is
Realtor has been under
I don't know if they go under contract
The question was:
Do you know of
I think I answered that.
Yes.
Thomas Rankin
January 5, 2009
189 1
A.
Right.
2
Q.
Is there anything else?
3
A.
There could be more examples.
4
recall.
5
Q.
6
newspaper advertisements have run?
7
A.
I don't.
8
Q.
Do you know if it's been within the
9
past six months?
I don't
Do you know during what time frame the
10
A.
I don't know.
11
Q.
Are those of which you're aware ones
12
that have run within the past six months?
13
A.
14
printed.
15
Q.
16
engaged to seek tenants for the building.
17
A.
Uh-huh.
18
Q.
Do you know what realtor was engaged?
19
A.
Currently Sam Kuhn of -- an Eric George
20
of Calgary Realty.
21
Q.
Do you know when they were engaged?
22
A.
Six months ago, possibly.
23
Q.
Do you know if they've brought any
24
prospective tenants through the building in the
I don't know when those would have been
You also said that a realtor had been
Thomas Rankin
January 5, 2009
190 1
past 60 days?
2
A.
Sixty days.
3
Q.
Do you know how recently they have
4
brought a prospective tenant into the building?
5
A.
I don't.
6
Q.
Do you know whether Mr. Clark has
7
discouraged any current tenants in the building
8
from remaining as tenants in the building?
9
A.
I don't know of that.
10
Q.
Do you know of any subtenants that
11
occupy space in the building?
12
A.
13
please.
14
Q.
15
building that occupies not pursuant to a direct
16
lease with the owner, but instead pursuant to a
17
lease with another tenant.
18
sublease.
19
A.
Not that I'm aware of.
20
Q.
Do you know the current maturity date
21
of the mortgage on 137 East State Street?
22
A.
Probably not the exact date.
23
Q.
Do you know that it's coming up in --
24
this month?
I think so.
Can you define "subtenant" for me,
Yes.
It would be a tenant in the
And we call that a
Thomas Rankin
January 5, 2009
191 1
A.
Yes.
2
Q.
Do you know if State Street Partners
3
has the ability to pay off the mortgage when it
4
comes due this month?
5
A.
It does not as far as I'm aware.
6
Q.
If State Street Partners cannot pay off
7
the mortgage when it comes due later this month
8
and Fifth Third Bank calls the guaranty of State
9
Street Consultants, will it have the financial
10
capacity to make good on its guaranty?
11
A.
No, not that I am aware of.
12
Q.
If Fifth Third Bank then goes to
13
Mr. Clark and calls his guaranty of the repayment
14
of that mortgage loan, will he have the capacity
15
to make good on the guaranty?
16
A.
Not that I'm aware of.
17
Q.
At this point in time, he has a
18
negative net worth, does he not?
19
A.
20
time what his net worth might be.
21
Q.
22
his net worth, it was negative, correct?
23
A.
24
yes.
I don't know at this exact point in
When you were most recently aware of
I don't recall, but I would presume,
Thomas Rankin
January 5, 2009
192 1
Q.
2
correct?
3
A.
Yes.
4
Q.
Did you see a newspaper article in The
5
Columbus Dispatch, oh, I don't know, near the end
6
of November, early December, in which Mr. Clark
7
was extensively quoted about his financial affairs
8
and circumstances?
9
A.
I did see the article.
10
Q.
I think he said in that that he had a
11
negative net worth, didn't he?
12
A.
I don't recall.
13
Q.
Are you aware of any assets of NSC
14
Consulting Corp. having been transferred to State
15
Street Consultants?
16
A.
Not that I'm aware of.
17
Q.
We talked a little while ago about
18
Mr. Clark receiving in-kind compensation or
19
remuneration from State Street Consultants and/or
20
NSC Consulting Corp., and I want to revisit that
21
for just a minute.
22
that.
23
several different kinds of insurance.
24
And that's been fairly recently,
You gave me some examples of
We talked about insurance premiums for
Is there anything else of value apart
Thomas Rankin
January 5, 2009
193 1
from the distributions that Mr. Clark has received
2
from State Street Consultants or NSC Consulting
3
Corp. and these payments that either of those
4
entities have made of his insurance premiums that
5
Mr. Clark has received from either of those
6
entities in the last three years?
7
A.
Not that I can think of right now.
8
Q.
To your knowledge, have either of those
9
entities made house payments for Mr. Clark on
10
either of his residences?
11
A.
I don't recall if they did.
12
Q.
Have either of those entities paid
13
other bills of Mr. Clark?
14
A.
I don't know.
15
Q.
Have either of those entities provided
16
him an automobile?
17
A.
18
from 2006 forward on an automobile.
19
recall.
20
Q.
21
NSC Consulting Group paid for any nonbusiness
22
travel for Mr. Clark?
23
A.
I don't know.
24
Q.
Have either of those entities paid for
I don't pay the bills.
I don't recall if NSC made any payments I don't
Has either State Street Consultants or
Thomas Rankin
January 5, 2009
194 1
any of Mr. Clark's family members or for his
2
girlfriend or other friends to accompany him on
3
any trips?
4
A.
5
I don't know.
6
Q.
Who would know all of that?
7
A.
Mr. Clark.
8
Q.
Who at SSC, what other employees, would
9
know about that?
I don't make his travel arrangements.
10
A.
11
that or not.
12
Q.
13
Street Consultants, who you would expect to know
14
that, if anyone does?
15
A.
16
anyone does.
17
Q.
18
talking about other employees of State Street
19
Consultants.
20
A.
Possibly.
21
Q.
Based upon her position within the
22
company and the access she has, if anyone would
23
know about it, she would know it, correct?
24
A.
I don't know if Ms. Harrison would know
Is she the person at SSC, or State
I would expect Mr. Clark to know it, if
Well, I understand that, but I'm
Yes.
Thomas Rankin
January 5, 2009
195 1
Q.
2
right, or transferring the moneys?
3
A.
Yes.
4
Q.
Have you ever read the pledge agreement
5
executed by Mr. Clark?
6
Because she'd be writing the checks,
MR. GONZALEZ:
Objection.
7
Q.
You may respond.
8
A.
I'm sure I have.
9
Q.
I may have misspoken.
That pledge
10
agreement I think was executed by State Street
11
Consultants and NSC Consulting Group.
12
revision on my part, have you read that?
13
A.
I'm sure I have.
14
Q.
Are you familiar with the terms of it?
15
A.
No.
16
Q.
Have you read the cross purchase
17
agreement among Mr. Clark, Mr. Tipps, State Street
18
Partners, State Street Consultants, NSC Consulting
19
Corp., and Public Policy Consultants?
20
A.
Yes.
21
Q.
Are you conversant with the terms of
22
that?
23
A.
No.
24
Q.
Meaning if I ask you questions about
With that
Conversant --
Thomas Rankin
January 5, 2009
196 1
it, you can talk with me about it?
2
A.
I might.
3
Q.
Okay.
4
A.
I don't have it memorized.
5
know to what extent you would expect conversant to
6
be.
7
Q.
8
competing with State Street Consultants?
9
A.
No.
10
Q.
No, you don't know?
11
A.
No, I don't know.
Do you know if NSC Consulting Corp. is
12
MR. WEAVER:
13
MR. CVETANOVICH:
14
THE VIDEOGRAPHER:
15
I didn't
Water break here? Yes.
That's fine.
We are off the
record at 1615.
16
(A brief recess is taken.)
17
THE VIDEOGRAPHER:
We are back on the
18
record at 1625.
19
Q.
20
entity known as Midwest Communications?
21
A.
Yes.
22
Q.
What do you understand it to be?
23
A.
A media services firm.
24
Q.
Do you know where its headquarters is
Mr. Rankin, are you familiar with an
Thomas Rankin
January 5, 2009
197 1
located?
2
A.
49 Grant Street.
3
Q.
Is that the same location into which
4
you understand that some of the lobbyists for
5
State Street Consultants will be relocating their
6
operations?
7
A.
Yes.
8
Q.
Do you know if Midwest Communications
9
owns the building?
10
A.
They do not.
11
Q.
Do you know who owns the building?
12
A.
A separate entity.
13
Q.
What's the name of the entity?
14
A.
Russell Clegg or Clegg Russell, LLC.
15
Q.
Do you know who any of the principals
16
are of that entity?
17
A.
Yes.
18
Q.
Who are they?
19
A.
Mary Russell and Robert Clegg.
20
Q.
Do you know someone named Patty
21
Russell?
22
A.
I do.
23
Q.
Does Patty Russell have an ownership
24
interest in Midwest Communications?
Thomas Rankin
January 5, 2009
198 1
A.
Yes.
2
Q.
Is it Mary --
3
A.
Patty -- Mary Patricia Russell.
4
formal name is Mary Russell.
5
Q.
Thank you.
6
A.
From what I know.
7
Q.
Okay.
8
Clark has an interest in that entity?
9
A.
He does not.
10
Q.
Do you know if he has an interest in
11
the building?
12
A.
He does not.
13
Q.
Do you know if Mr. Clark has provided
14
any financing to Midwest Communications?
15
A.
I don't know.
16
Q.
Do you know of any relationship
17
whatsoever between Mr. Clark and Midwest
18
Communications?
19
A.
Yes.
20
Q.
What is the relationship?
21
A.
Mr. Clark is an owner of Midwest
22
Communications.
23
Q.
24
last couple of minutes, Mr. Rankin, either I
That's Mary Russell.
Thank you.
Her
Do you know if Neil
Somewhere along the line here in the
Thomas Rankin
January 5, 2009
199 1
confused you or you confused me.
2
to try to find out which it is, and then we'll --
3
whoever it is, we'll get it straightened out here.
4
A.
Okay.
5
Q.
This entity, Midwest Communications,
6
you said it's Midwest Communications, LLC?
7
A.
No.
8
Q.
What is the full name of it, as best
9
you understand it?
Let me endeavor
10
A.
11
Midwest Communications & Media.
12
Q.
13
is?
14
A.
A general partnership.
15
Q.
Do you know who are the general
16
partners?
17
A.
Mary Patty Russell and Neil Clark.
18
Q.
Do you know for how long Mr. Clark has
19
been a general partner in Midwest Communications?
20
A.
I don't know how long.
21
Q.
Do you know what his percentage of
22
ownership interest is in that partnership?
23
A.
Fifty percent, as far as I know.
24
Q.
To your knowledge, are there any
Midwest Communications & Media. Yeah.
Do you know what nature of entity it
Thomas Rankin
January 5, 2009
200 1
contractual relationships between State Street
2
Consultants and Midwest Communications?
3
A.
Not that I'm aware of.
4
Q.
Apart from Mr. Clark being one of the
5
partners in Midwest Communications, are you aware
6
of any contractual relationships between Mr. Clark
7
and Midwest Communications?
8
A.
Not that I'm aware of.
9
Q.
Are you aware of any contractual
10
relationships between Mr. Clark and Mary Patty
11
Russell other than their partnership agreement for
12
Midwest Communications?
13
A.
Not that I'm aware of.
14
Q.
Could you repeat for me the name of the
15
entity that owns the building at 49 South Grant?
16
You said it's Clegg Russell, LLC?
17
A.
18
don't know which name is first.
19
which name is first.
20
Q.
21
you again.
Russell Clegg or Clegg Russell, LLC.
Thank you.
I don't recall
I
I just found it as I asked
22
To your knowledge, Mr. Clark has no
23
ownership interest in Clegg Russell or Russell
24
Clegg, correct?
Thomas Rankin
January 5, 2009
201 1
A.
To my knowledge, that's correct.
2
Q.
To your knowledge, does anyone other
3
than Mary Patty Russell or Mr. Clegg have an
4
interest in Clegg Russell or Russell Clegg?
5
A.
Not that I'm aware of.
6
Q.
Do you know how long Midwest
7
Communications has been in existence?
8
A.
I don't.
9
Q.
Do you know if it's been in existence
10
at least five years?
11
A.
Yes.
12
Q.
Has it been?
13
A.
Yes.
14
Q.
To your knowledge, has it been in the
15
same business for at least the past five years?
16
A.
It has.
17
Q.
Has its offices been in the same
18
location for at least the last five years?
19
A.
I don't think so.
20
Q.
Do you know when the offices of Midwest
21
Communications were relocated to 49 South Grant
22
Street?
23
A.
I don't know the specific date or year.
24
Q.
Excuse me.
Do you know how long Patty
Thomas Rankin
January 5, 2009
202 1
Russell has been a principal of Midwest
2
Communications?
3
A.
I don't.
4
Q.
Do you know if there are any partners
5
in Midwest Communications apart from Patty Russell
6
and Neil Clark?
7
A.
Not that I'm aware of.
8
Q.
Do you know if there have ever been?
9
A.
I don't know if that's the fact.
10
Q.
Do you know if Neil Clark provides any
11
manner of services to Midwest Communications?
12
A.
Yes.
13
Q.
What manner of services?
14
A.
Consulting, as an owner.
15
Q.
Do you know if Mr. Clark receives
16
compensation from Midwest Communications for the
17
services he provides it?
18
A.
19
Mr. Clark receives.
20
Q.
21
other form of compensation from Midwest
22
Communications?
23
A.
No.
24
Q.
Do you know for how long Mr. Clark has
Distribution of profits is what
Apart from that, does he receive any
Not that I'm aware of.
Thomas Rankin
January 5, 2009
203 1
been receiving distributions of profits from
2
Midwest Communications?
3
A.
I don't know specifically how long.
4
Q.
What is the earliest point of which
5
you're aware when Mr. Clark received a partnership
6
distribution from Midwest Communications?
7
A.
1994.
8
Q.
To your knowledge, do Midwest
9
Communications and State Street Consultants share
10
any clients or have any clients in common?
11
A.
Yes.
12
Q.
Can you name those clients?
13
A.
I can name two.
14
Q.
Would you do that, please.
15
A.
Or former clients.
16
former clients?
17
Q.
18
and then after each just indicate whether it's
19
former or current.
20
A.
21
both.
22
Q.
23
former clients that State Street Consultants and
24
Midwest Communications have or have had in common?
Current clients,
Why don't we have you identify both,
Vote Yes on Issue 3, former client for Vote No on Issue 5, former client for both. Are there any other either current or
Thomas Rankin
January 5, 2009
204 1
A.
Not that I can remember.
2
Q.
Do you know of any clients that Midwest
3
Communications and NSC Consulting Corp. have in
4
common or have had in common?
5
A.
Not that I'm aware of.
6
Q.
Do you know of any clients that Midwest
7
Communications has referred to State Street
8
Consultants?
9
A.
I don't know.
10
Q.
Do you know of any clients that State
11
Street Consultants has referred to Midwest
12
Communications?
13
A.
14
Consultants referring business to Midwest.
15
Q.
16
revenue-sharing agreements that exist or have
17
existed between State Street Consultants and
18
Midwest Communications?
19
A.
Not that I'm aware of.
20
Q.
Do you have any knowledge of any
21
expense sharing agreements that exist or have
22
existed between State Street Consultants and
23
Midwest Communications?
24
A.
I don't have knowledge of State Street
Do you have knowledge of any
Not that I'm aware of.
Thomas Rankin
January 5, 2009
205 1
Q.
2
Mr. Rankin, that some of the State Street
3
Consultants' lobbyists who are vacating 137 East
4
State Street will be occupying space in 49 South
5
Grant.
6
existence that will permit that to occur?
7
A.
Not that I know of.
8
Q.
Do you know whether there is a lease
9
that will be signed to permit that to occur?
You told me earlier in our proceeding,
Do you know whether there is a lease in
10
A.
Not that I know of.
11
Q.
Do you know what arrangements exist
12
that will permit some of State Street Consultants'
13
lobbyists to occupy space at 49 South Grant
14
Street?
15
A.
Do I know of -- I'm sorry?
16
Q.
Do you know what arrangements exist
17
that will permit some of State Street Consultants
18
consultants lobbyists to occupy space at 49 South
19
Grant Street?
20
A.
I could only presume a rent payment.
21
Q.
Do you know who the tenant will be
22
under that arrangement?
23
A.
24
Consultants.
I would presume State Street
Thomas Rankin
January 5, 2009
206 1
Q.
2
this new entity that Mr. Clark has spoken with you
3
about that will be paying the rent on 49 South
4
Grant?
5
A.
Do you know whether instead it will be
Not that I'm aware of.
6
- - - - -
7 8
Thereupon, Plaintiffs' Exhibit 4 is marked for purposes of identification.
9
- - - - -
10
Q.
11
document that's been marked Plaintiffs' Exhibit 4.
12
I'll ask you to take a moment and look at that,
13
please.
14
Mr. Rankin, I want to hand you now a
Had a chance to look that over, sir?
15
A.
Yes.
16
Q.
Have you seen reports like this before?
17
A.
Yes.
18
Q.
This says on its face, top of the very
19
first page, that it is a State Street Consultants
20
12 Month Cash-Flow Report, Year 2006.
21
that?
22
A.
I do.
23
Q.
And then up in the upper right-hand
24
corner of the first page and indeed each of the
Do you see
Thomas Rankin
January 5, 2009
207 1
pages of the exhibit we see a date, November 21st,
2
2007.
3
A.
I do.
4
Q.
Do you recognize that as the run date
5
of the report?
6
A.
Yes.
7
Q.
These are the kind of cash flow reports
8
which you told me earlier are sometimes produced
9
by Ms. Harrison, correct?
Do you see where I'm referring?
10
A.
Yes.
11
Q.
And these are reports the likes of
12
which you have seen in the past while providing
13
services for State Street Consultants, correct?
14
A.
Yes.
15
Q.
You understand how to read this report?
16
A.
Sure.
17
Q.
Let me ask you just a few questions
18
about it then.
19
column, we have a heading, Sources of Cash.
20
you see that?
21
A.
I do.
22
Q.
And then Business Income, and then
23
beneath that, we have a whole listing of things,
24
some of which are entities, some of which are
On the first page there, left-hand Do
Thomas Rankin
January 5, 2009
208 1
other than entities.
2
business income to State Street Consultants; is
3
that correct?
4
A.
Not all of them.
5
Q.
Some of them are, correct?
6
A.
That's correct.
7
Q.
All of them on the first page are,
8
correct?
9
A.
Yes.
10
Q.
And all of them on the second page are,
11
down to Vitas, V-I-T-A-S, which is about two and a
12
half inches from the bottom of the page, correct?
13
A.
That's right.
14
Q.
And then we have a series of items
15
listed that are something other than sources of
16
income, right?
17
A.
That's correct.
18
Q.
But they are sources of cash, correct?
19
A.
Yes.
20
Q.
For example, there is a line item there
21
very near the bottom that says, "Loan from Tom
22
Rankin."
23
A.
I do.
24
Q.
Do you recall having loaned money to
Those are sources of
Do you see that one?
Thomas Rankin
January 5, 2009
209 1
State Street Consultants?
2
A.
I think my entity has.
3
Q.
Your entity being Thomas A. Rankin &
4
Associates?
5
A.
And Company.
6
Q.
And Company.
7
A.
That's all right.
8
Q.
How many time has your entity loaned
9
money to State Street Consultants?
Excuse me.
10
A.
Looks like one time here.
11
Q.
One time in 2006 at least?
12
A.
Yes.
13
Q.
Correct?
14
your entity loaned money to State Street
15
Consultants?
16
A.
I don't recall exactly.
17
Q.
Why has your entity loaned money to
18
State Street Consultants?
19
A.
20
some money.
21
Q.
22
requested that your entity make a loan to State
23
Street Consultants?
24
A.
How many times overall has
Because State Street Consultants needed
When that has happened, who has
Mr. Clark.
Thomas Rankin
January 5, 2009
210 1
Q.
2
said yes?
3
A.
No.
4
Q.
How many times have you said no?
5
A.
Some.
6
Q.
How many?
7
A.
I don't know exactly how many.
8
Q.
What's your best approximation?
9
A.
Five.
10
Q.
When you've said no to a request from
11
Mr. Clark -- I should say a request by Mr. Clark
12
for a loan from your entity to State Street
13
Consultants, why have you said no?
14
A.
I may not have had the money.
15
Q.
Do you remember that as the reason
16
every time you said no?
17
THE WITNESS:
Spousal things.
18
MR. WEAVER:
There's a question
When that has happened, have you always
19
pending, I may need to confer with my client with
20
respect to the spousal privilege.
21
MR. CVETANOVICH:
22
MR. WEAVER:
23
MR. CVETANOVICH:
24
THE VIDEOGRAPHER:
That's fine.
May we do it? Sure.
Of course.
We are off the
Thomas Rankin
January 5, 2009
211 1
record at 1644.
2
(A brief recess is taken.)
3
THE VIDEOGRAPHER:
4
We are back on the
record at 1647.
5
MR. CVETANOVICH:
Mark, I can read
6
questions and answers up to the point where we
7
broke, if you want me to, or I can just attack
8
this differently.
9
MR. WEAVER:
Let me just state on the
10
record that thank you for allowing the courtesy of
11
me to confer with my client wherein I explained
12
more fully the boundaries of attorney-client
13
privilege and spousal privilege, and that my
14
client is ready to answer your questions however
15
you see fit to ask them.
16
MR. CVETANOVICH:
Great.
Thank you
17
very much.
18
Q.
19
Mr. Rankin, had to do with instances when
20
Mr. Clark requested that your company make a loan
21
to State Street Consultants, but in which you said
22
no, that your company would not make such a loan.
23
You told me that that happened perhaps five times,
24
not holding you to that specific number.
The line of questioning we were on,
And I
Thomas Rankin
January 5, 2009
212 1
had asked you when you said no, what was the
2
reason that you said no, and you told me that
3
perhaps you didn't have the money.
4
asked you, well, was that the reason every time.
5
And let me just sort of put that back on the
6
table.
7
And then I had
In those instances where you declined
8
Mr. Clark's request for your company to loan State
9
Street Consultants money, was it always because
10
your company didn't have the money to spare?
11
A.
12
with my spouse or my attorney, the reasons that I
13
did not -- said no was I did not have cash.
14
Q.
15
you thought State Street Consultants wasn't a good
16
credit risk?
17
A.
No.
18
Q.
Did you ever say no because you were
19
getting sick and tired of Mr. Clark coming and
20
asking your company to loan his company money?
21
A.
22
with my spouse or my attorney, no.
23
Q.
24
Other than discussions I may have had
All right.
Did you ever say no because
Other than discussions I may have had
Okay. THE WITNESS:
Is that all right?
Thomas Rankin
January 5, 2009
213 1
MR. WEAVER:
2
you believe.
3
believe.
4
You may always answer what
That's not privileged, what you
THE WITNESS:
Okay.
5
Q.
6
looking at together there, Mr. Rankin, "Loan from
7
Tom Rankin," do you see it there near the bottom
8
of page 2 on Exhibit 4?
9
A.
Yes.
10
Q.
Just above that, there's a line item
11
that says, "Loan from NSC."
12
A.
Yes.
13
Q.
Do you have any knowledge or
14
information about NSC having made loans to State
15
Street Consultants in the year 2006?
16
A.
17
that I have to substantiate that.
18
Q.
19
the layout of this report, this section that we're
20
looking at together is the "sources of cash"
21
section, correct?
22
A.
Yes.
23
Q.
And that's where one would expect to
24
see amounts flowing into State Street Consultants,
Just above the line item we've been
Do you see that?
I do.
I would have to refer to NSC records
Just looking at the -- what I'll call
Thomas Rankin
January 5, 2009
214 1
whether it's from the proceeds of a loan or
2
otherwise, correct?
3
A.
Yes.
4
Q.
This report, the line item we're
5
looking at together, would suggest that there were
6
moneys flowing into State Street Consultants via a
7
loan or loans from NSC in several different months
8
of the year 2006, correct?
9
A.
Yes.
10
Q.
Specifically February, April, July,
11
September, October, and December, correct?
12
A.
Yes.
13
Q.
And the aggregate amount of those loans
14
being $62,800.
15
A.
Yes.
16
Q.
Do you have any recollection whatsoever
17
of NSC Consulting Corp. having been making loans
18
of those amounts of money to State Street
19
Consultants?
20
A.
Yes.
21
Q.
You do have that recollection.
22
that happening?
23
A.
24
needed the cash.
Do you see that?
Why was
I presume State Street Consultants
Thomas Rankin
January 5, 2009
215 1
Q.
2
ever repaid what's reflected here as these loan
3
amounts from NSC Consulting Corp.?
4
flipping over to the "uses of cash" section,
5
correct?
6
A.
I am.
7
Q.
All right.
8
A.
Yes.
9
Q.
Direct me, if you would, is that on
Do you know if State Street Consultants
You're
10
page 5?
11
A.
Yes.
12
Q.
Top line?
13
A.
Yes.
14
Q.
And it looks like over the course of a
15
year there were four repayments aggregating
16
$62,800, correct?
17
A.
Yes.
18
Q.
Do you know if these loans were ever
19
documented?
20
A.
Through books and records.
21
Q.
What do you mean by that?
22
entries?
23
A.
Yes.
24
Q.
Do you know if they were ever
Accounting
Thomas Rankin
January 5, 2009
216 1
documented by any kind of a loan agreement?
2
A.
Not that I'm aware of.
3
Q.
Do you know if they were ever
4
documented by promissory notes?
5
A.
Not that I'm aware of.
6
Q.
Do you know if State Street Consultants
7
ever gave NSC Consulting Corp. any security for
8
repayment of the loans?
9
A.
Not that I'm aware.
10
Q.
Do you know if there was ever a
11
resolution of State Street Consultants's passed
12
authorizing this borrowing from NSC Consulting
13
Corp.?
14
A.
Not that I'm aware of.
15
Q.
Do you know who made the determination
16
that State Street Consultants would borrow money
17
from NSC Consulting Corp.?
18
A.
Mr. Clark.
19
Q.
Do you know if there was interest paid
20
on the loans?
21
A.
Not that I'm aware of.
22
Q.
Do you know why NSC Consulting Corp.
23
was willing to loan moneys at no interest?
24
A.
I don't know why.
Thomas Rankin
January 5, 2009
217 1
Q.
2
practice, is it?
3
A.
It could be, I guess.
4
Q.
In your experience, it doesn't happen
5
much, does it, in the marketplace, people loan
6
money at no interest?
7
A.
Commonly-owned entities.
8
Q.
Are you saying this was not an
9
arm's-length transaction?
It's not a very common business
10
A.
No, I'm not saying that.
11
Q.
You think it was an arm's-length
12
transaction?
13
A.
14
commonly-owned entities.
15
Q.
16
to page 3 of Exhibit 4, and specifically the --
17
over in the left-hand column there's a category,
18
"unclassified income."
19
A.
I do.
20
Q.
And under that heading, "unclassified
21
income," there is a whole listing of clients.
22
you see that?
23
A.
I do.
24
Q.
Why are these clients here under this
I said I think it happens with
Let me direct your attention, please,
Do you see that?
Do
Thomas Rankin
January 5, 2009
218 1
heading, "unclassified income," and the income
2
derived from these clients characterized as
3
unclassified income rather than these clients
4
being back on the list on page 1, carrying over
5
onto page 2?
6
A.
7
it looks like to me is that those are clients that
8
are affiliated with Aronoff & Associates.
9
Q.
Why do you say that?
10
A.
Because those look like Aronoff &
11
Associates clients.
12
Q.
You just recognize them as such?
13
A.
I do.
14
Q.
There's nothing you see on this page 3
15
that indicates they're Aronoff clients, correct?
16
A.
That's correct.
17
Q.
Okay.
18
you would, to page 5.
19
the loan repayment to NSC, but I actually want you
20
to come down the page, if you would, please, to a
21
line item that's called "executive compensation."
22
Do you see that?
23
A.
Yes.
24
Q.
Does that refer to Mr. Clark's
Ms. Harrison prepared these.
And what
Let me ask you to flip over, if And we earlier looked at
Thomas Rankin
January 5, 2009
219 1
compensation?
2
A.
It refers to Mr. Clark's distribution.
3
Q.
Okay.
4
A.
Distributions.
5
Q.
Distributions are a form of
6
compensation, are they not?
7
A.
Yes.
8
Q.
It's compensation to an owner, right?
9
A.
Not all the time.
10
Q.
Okay.
11
though, right?
12
A.
It appears as though it was.
13
Q.
Let me ask you this question:
14
Mr. Clark, to your knowledge, receive
15
distributions of profits from Midwest
16
distribution -- excuse me -- Midwest Communication
17
in 2006 or for 2006?
18
A.
Yes.
19
Q.
In what amount?
20
A.
I don't know exactly.
21
Q.
What's the range?
22
A.
300 to 400,000.
23
Q.
Did Mr. Clark receive a distribution of
24
profits from Midwest Communications for 2007?
In this instance, it was,
Did
Thomas Rankin
January 5, 2009
220 1
A.
Not that I can recall.
2
Q.
Did Midwest Communications operate at a
3
loss for 2007?
4
A.
Yes.
5
Q.
Was a portion of the loss allocated to
6
Mr. Clark?
7
A.
Yes.
8
Q.
Do you know how great the loss was?
9
A.
I don't recall.
10
Q.
Do you know if Mr. Clark has received
11
distributions of profits from Midwest
12
Communications for 2008?
13
A.
Yes.
14
Q.
Do you know in what amount?
15
A.
I don't know exactly.
16
Q.
Do you have a range or an
17
approximation?
18
A.
19
- - - - -
20 21
300 to 400,000.
Thereupon, Plaintiffs' Exhibit 5 is marked for purposes of identification.
22
- - - - -
23
Q.
24
document that's been marked Plaintiffs' Exhibit 5.
Mr. Rankin, let me now hand you a
Thomas Rankin
January 5, 2009
221 1
If you would, please, take a moment and look at
2
that and then I'll have a few questions for you
3
about that.
4
A.
Okay.
5
Q.
Had an opportunity to look at that now,
6
Mr. Rankin?
7
A.
Yes, uh-huh.
8
Q.
Having done so, do you recognize it as
9
a State Street Consultants 12 Month Cash-Flow
10
Report for year 2007?
11
A.
Yes.
12
Q.
And the run date on this one is
13
November 14, 2007, correct?
14
A.
Yes.
15
Q.
Let me direct your attention, please,
16
to page 3 of this exhibit, Exhibit 5.
17
specifically to a category here that's labeled
18
"Unclassified Income SA/NSC."
19
A.
Yes.
20
Q.
And then beneath that heading we have a
21
whole listing of clients, do we not?
22
A.
Yes.
23
Q.
I want to focus your attention first on
24
the heading again, "Unclassified Income SA/NSC."
And
Do you see that?
Thomas Rankin
January 5, 2009
222 1
Is the SA reference to Stan Aronoff?
2
A.
I would presume it is.
3
Q.
And I take it the NSC reference is to
4
NSC Consulting Corp.?
5
A.
Yes.
6
Q.
Why is it that Mr. Aronoff's clients
7
would be listed under this unclassified income
8
heading on a cash flow report?
9
A.
I don't know why it would be put under
10
an unclassified category.
11
Q.
12
NSC Consulting Corp.
13
Consulting Corp. clients would show up on a cash
14
flow report for State Street Consultants?
15
A.
No.
16
Q.
It's the case, is it not, that on a
17
cash flow report for State Street Consultants the
18
only incoming cash that should show up is cash
19
that is available to State Street Consultants,
20
belongs to State Street Consultants, correct?
21
A.
Correct.
22
Q.
And on the "uses of cash" portion,
23
which we haven't gotten to yet, but the only uses
24
of cash that should show up would be uses of cash
Okay.
Let me ask the same question for Do you know why NSC
Thomas Rankin
January 5, 2009
223 1
to pay or satisfy obligations of State Street
2
Consultants, correct?
3
A.
Yes.
4
Q.
Staying here on page 3 and under the
5
same heading but down rather near the bottom we
6
have, I guess under American Cancer Society or
7
American Cancer, we see Cincinnati Schools,
8
Cincinnati Symphony, The Limited and then the
9
others on that page.
Do you see those?
10
A.
I do.
11
Q.
Do you recognize those as clients of
12
NSC Consulting Corp.?
13
A.
Yes.
14
Q.
Do you recognize the other clients in
15
that list but above Cincinnati Schools as having
16
been clients brought to State Street Consultants
17
by Stan Aronoff?
18
A.
Above American Cancer, yes.
19
Q.
Yes.
20
Okay.
There is zero cash flow for that
21
grouping of clients there beginning with
22
Cincinnati Schools, through the month of October,
23
correct?
24
A.
Yes.
Thomas Rankin
January 5, 2009
224 1
Q.
2
because this is a report that was generated on
3
November 14th, we don't have actual figures.
4
Instead we have only budgeted figures, correct?
5
A.
It appears correct.
6
Q.
Do you know why there would be budgeted
7
figures for November and December on a cash flow
8
report of State Street Consultants for clients of
9
NSC Consulting Corp.?
And then for November and December,
10
A.
Yes.
11
Q.
Why?
12
A.
To present the group as a whole.
13
Q.
What do you mean by "the group as a
14
whole"?
15
A.
I think we defined "group" earlier.
16
Q.
Well, we defined group as several of
17
your clients, and that was just for ease of
18
communication.
19
A.
Got you.
20
Q.
We can redefine group or do anything
21
you want --
22
A.
Nope.
23
Q.
-- but group as we defined it has no
24
applicability here.
Thomas Rankin
January 5, 2009
225 1
A.
Okay.
2
Q.
So what I'm trying to understand is why
3
this cash flow report would be presenting budgeted
4
income figures for clients not of State Street
5
Consultants, but of NSC Consulting Corp.
6
A.
7
see all the lobbying clients in one specific
8
report.
9
Q.
So I'm presuming I can -- so Neil can
Now, do you know that to be the reason
10
it was done this way, or you're speculating that's
11
a reason it could have been done this way?
12
A.
13
been -- I'm speculating it was done this way.
14
Q.
15
this way?
16
A.
17
presented in this fashion.
18
Q.
What makes you say that?
19
A.
Through -- I don't know specifically,
20
but I think I heard that.
21
Q.
From whom did you hear it?
22
A.
Neil Clark.
23
Q.
When did you hear it?
24
A.
I don't recall.
That's one reason why it may have
Do you know why it was actually done
I think Mr. Tipps requested it be
Maybe November of '07.
Thomas Rankin
January 5, 2009
226 1
Q.
2
propriety of putting together a cash flow report
3
like this for State Street Consultants?
4
A.
No.
5
Q.
Do you recall having provided anyone
6
any input into the determination of whether this
7
manner of presentation of a cash flow report for
8
State Street Consultants would be appropriate?
9
A.
Did anyone consult you about the
It was my client's opinion or decision
10
to do that.
11
Q.
Did you provide any input?
12
A.
I don't recall.
13
Q.
Do you know if cash flow reports such
14
as Exhibit 4 and Exhibit 5 which we've looked at
15
together were ever provided to Fifth Third Bank?
16
A.
I don't know if they were or not.
17
Q.
Who would know that?
18
A.
The bank.
19
Q.
Would anyone at State Street
20
Consultants know that?
21
A.
Possibly.
22
Q.
Do you know if -- well, let's come back
23
to possibly.
24
A.
Okay.
Thomas Rankin
January 5, 2009
227 1
Q.
Possibly who would know that?
2
A.
Ms. Harrison prepares the report.
3
Mr. Clark would, I would imagine, advise whether
4
to give it to the bank or not.
5
Q.
6
is there anyone else at State Street Consultants
7
who you would expect to know whether the cash flow
8
reports were provided to any of State Street
9
Consultants' banks?
Apart from Mr. Clark and Ms. Harrison,
10
A.
Not that I'm aware of.
11
Q.
Is there anyone at State Street
12
Consultants or State Street Partners who you would
13
expect to know -- and, again, other than Mr. Clark
14
and Ms. Harrison -- who you would expect to know
15
whether the cash flow reports were presented to
16
State Street Partners' banks?
17
A.
18
if I answered that question correctly.
19
Q.
Anyone else?
20
A.
Not that I'm aware of.
21
Q.
Do you know if either State Street
22
Consultants or State Street Partners maintains a
23
file containing duplicates of all of the financial
24
statements that have been submitted to their
Possibly Mr. Tipps, but -- I'm not sure
Thomas Rankin
January 5, 2009
228 1
banks?
2
A.
I don't know if they do or not.
3
Q.
Who at State Street Consultants would
4
you expect to know that?
5
A.
Mr. Clark.
6
Q.
Anyone else?
7
A.
Possibly Ms. Harrison.
8
Q.
Apart from those two, anyone else?
9
A.
Not that I would think.
10
Q.
At State Street Partners, would it be
11
the same list but perhaps add Mr. Tipps?
12
A.
Possibly.
13
Q.
I may have asked you this, Mr. Rankin.
14
If I did, I apologize, and you can just tell me
15
and we'll move on to something else.
16
Do you know what banks NSC Consulting
17
Corp. has a relationship with?
18
A.
Huntington Bank and Fifth Third Bank.
19
Q.
We did talk about that.
20
A.
We did.
21
Q.
Let me ask you to turn over to page 4,
22
if you would, still on Exhibit 5.
23
A.
Yes.
24
Q.
On this page, just a few inches from
Thank you.
Are you there?
Thomas Rankin
January 5, 2009
229 1
the top, we have a heading, "Uses of Cash."
2
you see that?
3
A.
Yes.
4
Q.
And then right under that a heading,
5
"business expenses."
6
A.
Yes.
7
Q.
And then a bunch of expense items are
8
listed.
9
A.
Yes.
10
Q.
If you get down, oh, about three items
11
from the bottom of that list, there is an item,
12
NSC Corp. expenses.
13
A.
I do.
14
Q.
There are no actual amounts in the
15
months of January through October, but there are
16
budgeted amounts for each of November and
17
December.
Do you see that?
18
A.
Yes.
19
Q.
Can you tell me why on a State Street
20
Consultants cash flow report there would be
21
budgeted amounts to cover not State Street
22
Consultants' expenses but NSC Consulting Corp.
23
expenses?
24
A.
Do
Do you see that listing I'm showing you?
Do you see that?
I can't tell you why.
Thomas Rankin
January 5, 2009
230 1
Q.
2
propriety of this?
3
A.
No.
4
Q.
Do you know who at State Street
5
Consultants decided to include that line item on
6
this cash flow report?
7
A.
I presume Mr. Clark.
8
Q.
Bottom of page 2 on Exhibit 5,
9
Mr. Rankin, the very last item we have another
Did anyone consult you about the
10
loan from NSC.
11
that loan?
12
A.
I don't recall.
13
Q.
Let me refer you back to page 3 of
14
Exhibit 5, Mr. Rankin.
15
this question but didn't quite get to the
16
question, and let me pin that down before we move
17
on.
18
Do you have any knowledge about
I think I asked around
We did talk about several line items
19
there near the bottom of the page, Cincinnati
20
Schools, Cincinnati Symphony, and all those other
21
clients listed there down to the bottom of page.
22
Do you know why, given that there was no actual
23
income through October on this cash flow report,
24
there is budgeted income for the last two months
Thomas Rankin
January 5, 2009
231 1
of 2007?
2
A.
I don't know why.
3
- - - - -
4 5
Thereupon, Plaintiff's Exhibit 6 is marked for purposes of identification.
6
- - - - -
7
Q.
8
Plaintiffs' Exhibit 6 and ask you to take a moment
9
and look at that, please.
I'd like to hand you now, Mr. Rankin,
Had a chance to look at
10
it?
11
A.
Yes.
12
Q.
Ready for a question?
13
A.
I am.
14
Q.
Okay.
15
A.
Right.
16
Q.
And Exhibit 5 is a State Street
17
Consultants Cash Flow Report, Year 2007, run on
18
November 14th, 2007.
19
6, and Exhibit 6 indicates that it is a State
20
Street Consultants 12 Month Cash-Flow Report, Year
21
2007, run on January 15, 2008.
22
A.
Yes.
23
Q.
And that difference in the run dates
24
explains, does it not, why whereas on Exhibit 5 we
We just looked at Exhibit 5.
Now we're looking at Exhibit
Correct?
Thomas Rankin
January 5, 2009
232 1
had budgeted amounts only for November and
2
December, on Exhibit 6 we have actual dollar
3
amounts for November and December, correct?
4
A.
5
is gone.
6
Q.
7
end and actual numbers are in, right?
8
A.
Yes.
9
Q.
If you would, why don't you keep
I would presume since the "budget" word
By this time we're two weeks past year
10
Exhibit 5 there, because I'm going to have you
11
compare Exhibits 5 and 6 on just a couple of
12
points.
13
A.
Uh-huh.
14
Q.
Exhibit 5, page 3, you and I looked at
15
together.
That's the Unclassified Income SA/NSC.
16
You see that?
17
A.
I do.
18
Q.
When we get over to Exhibit 6, also
19
page 3, we have an Unclassified Income SA/NSC
20
heading, but underneath that heading we do not
21
have those clients that we addressed on Exhibit 5,
22
starting with Cincinnati Schools, Cincinnati
23
Symphony, The Limited and so on.
24
those are gone?
You see that
Thomas Rankin
January 5, 2009
233 1
A.
I do.
2
Q.
Do you know why they don't appear on
3
Exhibit 6?
4
A.
Just looking at this briefly --
5
Q.
Yes, sir.
6
A.
-- it appears as though Janie,
7
Ms. Harrison, may have consolidated some
8
categories inadvertently.
9
Q.
Could you just tell us specifically
10
what you mean?
11
at and then tell us why you interpret it as you
12
do.
13
A.
14
Cancer.
15
Q.
Yes.
16
A.
I guarantee you American Cancer in
17
October did not pay with us -- pay State Street
18
Consultants, I'm sorry, $378,500.
19
Q.
It's a big number.
20
A.
It's a big number.
21
Q.
Okay.
22
figure includes not only the revenues realized
23
from American Cancer, but also revenues realized
24
from some other clients?
Direct us to what you are looking
Exhibit 6, page 3, under American
So you're assuming that that
Thomas Rankin
January 5, 2009
234 1
A.
Yes.
2
Q.
Is that the assumption you're making?
3
A.
Yes.
4
Q.
Do you know what other clients?
5
A.
I could only presume NSC Consulting
6
Corporation.
7
Q.
And why do you presume that?
8
A.
Because American Cancer was a client of
9
NSC Consulting Corporation.
10
Q.
11
Ms. Harrison did was lump all of the income from
12
NSC Consulting Corp. clients into just this one
13
line item which she's calling American Cancer?
14
A.
Most likely.
15
Q.
All right.
16 17
So your inference is that what
THE VIDEOGRAPHER:
Mr. Cvetanovich,
you've got about five.
18
MR. CVETANOVICH:
All right.
I think
19
he starts me out with six-minute tapes.
What do
20
you think?
21
Q.
22
any NFC -- excuse me -- NSC Consulting Corp.
23
revenues on this cash flow report for State Street
24
Consultants?
Do you know why Ms. Harrison included
Thomas Rankin
January 5, 2009
235 1
A.
2
heard that question a few minutes ago.
3
Q.
4
would, please, on Exhibit 6.
5
A.
Yes.
6
Q.
What starts out at the top of the page
7
I guess is actually carried over from the
8
preceding page.
9
need to look near the bottom of page 3, "Uses of
I don't know why.
Except I may have
Let me have you turn to page 4, if you
So to get a heading, we actually
10
Cash, Business Expenses."
11
A.
Yes.
12
Q.
And then the list carries over on to
13
the top of page 4.
14
sir?
15
A.
I do.
16
Q.
Looking then at the carryover portion
17
of that list, if you come down maybe an inch and a
18
half, you see NSC Corp. expenses.
19
where I'm directing your attention?
20
A.
I do.
21
Q.
And for the month of October, more than
22
$75,000 of NSC corporate expenses are being
23
reflected on this State Street Consultants cash
24
flow report.
Do you see that?
Do you see where I am there,
Do you see that?
Do you see
Thomas Rankin
January 5, 2009
236 1
A.
Yes.
2
Q.
I take it that means that State Street
3
Consultants paid $75,856 of NSC Consulting Corp.'s
4
expenses.
5
this?
6
A.
It could be interpreted that way.
7
Q.
All right.
8
page, we have another line item, and now we're
9
under "unclassified expenses," but another line
Is that the way you would interpret
Down at the bottom of the
10
item labeled "loan repayment to NSC."
11
that?
12
A.
Yes.
13
Q.
I think we are now done with 5 and 6,
14
Mr. Rankin.
15
but I'm done with them.
You can keep them there if you like,
16
- - - - -
17 18
Thereupon, Plaintiffs' Exhibit 7 is marked for purposes of identification.
19
- - - - -
20
Q.
21
Plaintiffs' Exhibit 7.
22 23 24
Do you see
Let me now hand you, Mr. Rankin,
THE VIDEOGRAPHER:
We are off the
record at 1727. (A brief recess is taken.)
Thomas Rankin
January 5, 2009
237 1 2
(Mr. Behal entered the conference room.)
3
THE VIDEOGRAPHER:
We are back on the
4
record at 1740.
5
Q.
6
break I handed you Plaintiffs' Exhibit 7.
7
you now had an opportunity to look that over?
8
A.
Yes.
9
Q.
Plaintiffs' Exhibit 7 is State Street
Mr. Rankin, just before we took a short Have
10
Consultants' 12 Month Cash-Flow Report, Year 2008,
11
the run date being November 19, 2008, correct?
12
A.
Yes.
13
Q.
Let me direct your attention to page 4
14
of the report, under the heading "business
15
expenses," and very near the list -- near the end
16
of the list of business expenses we have a line
17
item for NSC Corp. expenses.
18
A.
Yes.
19
Q.
And there are expense amounts noted for
20
each month, January through October, of 2008.
21
total amount for 2008 being $79,081.
22
that?
23
A.
Yes.
24
Q.
And this statement reflects, does it
Do you see that?
The
Do you see
Thomas Rankin
January 5, 2009
238 1
not, that NSC corporate expenses are being treated
2
as expenses by State Street Consultants?
3
A.
Can you repeat that?
4
Q.
Yes.
5
showing up as expense items on a cash flow report
6
for State Street Consultants, correct?
7
A.
Uh-huh.
8
Q.
You need to say yes or no.
9
A.
Yes.
10
Q.
The inference from that would be that
11
these NSC corporate expenses are being paid with
12
cash or income of State Street Consultants,
13
correct?
14
A.
That's not correct.
15
Q.
Well, the essence of this report is to
16
present sources of income and uses of cash,
17
sources and uses of cash by State Street
18
Consultants, correct?
19
A.
20
presume that's what they were trying to do.
21
Q.
22
cash is, right?
23
A.
Yes.
24
Q.
Or stated differently, that's what a
This report --
We've got NSC corporate expenses
It's not my report, so I can only
Well, that's what a sources and uses of
Thomas Rankin
January 5, 2009
239 1
cash flow report is?
2
A.
Yes.
3
Q.
And this one is for State Street
4
Consultants, correct?
5
A.
It is.
6
Q.
And it reflects State Street
7
Consultants' sources of cash and its uses of cash,
8
correct?
9
A.
Yes.
10
Q.
And this report shows on page 4 that
11
one of the uses of State Street Consultants' cash
12
was to pay NSC corporate expenses.
13
the form shows, correct?
14
A.
That's what it appears.
15
Q.
All right.
16
that.
17
That's what
I think we're done with
I just have a series of documents that
18
I'd like you to identify for us, if you would,
19
Mr. Rankin.
20
but you know the documents better than any of the
21
rest of us.
22 23 24
I think they're fairly self-evident,
- - - - Thereupon, Plaintiffs' Exhibit 8 is marked for purposes of identification.
Thomas Rankin
January 5, 2009
240 1
- - - - -
2
Q.
3
document that's been marked Plaintiffs' Exhibit 8.
4 5
First of all, let me hand you a
MR. CVETANOVICH:
Do you want one also,
Bob?
6
MR. BEHAL:
7
MR. CVETANOVICH:
No.
Thank you, though. You're welcome.
8
Q.
Had a chance to look that over?
9
A.
Uh-huh.
10
Q.
Yes?
11
A.
Yes.
12
Q.
That's all right.
13
8 is State Street Consultants, LLC, Balance Sheet
14
as of December 31, 2006, correct?
15
A.
Yes.
16
Q.
And you caused this to be generated or
17
printed for purposes of being produced to the
18
Plaintiffs in this litigation, correct?
19
A.
20
Yes.
Thereupon, Plaintiffs' Exhibit 9 is marked for purposes of identification.
23 24
Plaintiffs' Exhibit
- - - - -
21 22
Sorry.
- - - - Q.
Let me now hand you Plaintiffs' Exhibit
Thomas Rankin
January 5, 2009
241 1
9.
2
now, Mr. Rankin?
3
A.
Yes.
4
Q.
Exhibit 9 is State Street Partners,
5
PLL -- Exhibit 9 is State Street Partners, PLL,
6
Profit & Loss, January through December 2007,
7
correct?
8
A.
Yes.
9
Q.
And you caused this to be generated or
Have you had a chance to look over Exhibit 9
10
printed for purposes of production to the
11
Plaintiffs in this lawsuit, correct?
12
A.
Yes.
13
Q.
Having a little trouble keeping all
14
these things in any kind of a meaningful sequence
15
here, Mr. Rankin, but we just keep grinding
16
through them.
17
- - - - -
18 19
Thereupon, Plaintiffs' Exhibit 10 is marked for purposes of identification.
20
- - - - -
21
Q.
22
Had a chance to look that over, sir?
23
A.
Yes.
24
Q.
Exhibit 10 is State Street Consultants,
Let me hand you Plaintiffs' Exhibit 10.
Thomas Rankin
January 5, 2009
242 1
LLC, Balance Sheet, as of December 31, 2007,
2
correct?
3
A.
Yes.
4
Q.
And that is a document that you
5
generated or printed for purposes of production to
6
the Plaintiffs in this lawsuit, correct?
7
A.
Yes.
8
- - - - -
9 10
Thereupon, Plaintiffs' Exhibit 11 is marked for purposes of identification.
11
- - - - -
12
Q.
13
11.
14
Mr. Rankin?
15
A.
Yes.
16
Q.
Exhibit 11 is State Street Consultants,
17
LLC, Profit & Loss, January through December 2006,
18
correct?
19
A.
Yes.
20
Q.
And that is a document that you
21
generated or printed for purposes of production to
22
the Plaintiffs in this action, correct?
23
A.
24
Let me now hand you Plaintiffs' Exhibit Had a chance to look over Exhibit 11,
Yes. - - - - -
Thomas Rankin
January 5, 2009
243 1 2
Thereupon, Plaintiffs' Exhibit 12 is marked for purposes of identification.
3
- - - - -
4
Q.
5
12.
6
that, please.
7
Mr. Rankin?
8
A.
Yes.
9
Q.
Exhibit 12 is State Street Consultants,
Now let me hand you Plaintiffs' Exhibit I'll ask you to take a moment and look at Had a chance to look at that now,
10
LLC, Profit & Loss, January through December 2007,
11
correct?
12
A.
Yes.
13
Q.
And that is a document that you
14
generated or printed to be produced to the
15
Plaintiffs in this action, correct?
16
A.
Yes.
17
Q.
Let me ask you to get Exhibits 8 and 11
18
before you there.
19
A.
Uh-huh.
20
Q.
Do you have those two, sir?
21
A.
Yes.
22
Q.
You told me earlier that you prepared a
23
2006 federal tax return for State Street
24
Consultants, and my question for you is:
Are the
Thomas Rankin
January 5, 2009
244 1
net income figures from Exhibit 11 the same
2
figures that were carried over onto the 2006
3
federal income tax return of State Street
4
Consultants?
5
A.
6
2006 SSC -- State Street Consultants' P&L.
7
it is.
8
one.
I don't have the last two pages of the
I'm sorry.
Here
I was looking at the wrong
Sorry about that.
9
MR. BEHAL:
Sorry.
10
Q.
11
now, sir?
12
A.
I do.
13
Q.
Just so the record is clear, would you
14
identify the exhibit number?
15
A.
Exhibit 11.
16
Q.
Yes, sir.
17
A.
I would have to check the records, the
18
tax return.
19
Q.
20
haven't produced the tax returns yet?
21
A.
22
you would have been given them to me already.
23
Q.
24
for production to the Plaintiffs in this lawsuit?
Have you got the correct one before you
Are you aware that the Defendants
No.
Yes.
Yeah, I'm aware.
I guess
Have you been asked to assemble those
Thomas Rankin
January 5, 2009
245 1
A.
I have not as of yet.
2
Q.
Can you think of any reason why the
3
figures on the 2006 tax return for State Street
4
Consultants, LLC, that income figures would differ
5
from those reflected on the profit and loss
6
statement at which you're looking, which is
7
Exhibit 11?
8
A.
9
nondeductible expenses.
There would be a difference for certain
10
Q.
Such as what?
11
A.
Club dues is not deductible for tax
12
purposes.
13
Q.
14
would expect to be a difference between the net
15
income figures from the 2006 P&L and the 2006 tax
16
return?
17
A.
18
50 percent limitation.
19
Q.
20
expect to cause the net income figures that appear
21
on the P&L on the one hand and the tax return on
22
the other to differ?
23
A.
24
stated items.
All right.
Anything else that you
Meals and entertainment is subject to a
Okay.
Anything else that you would
Charitable contributions are separately
Thomas Rankin
January 5, 2009
246 1
Q.
Okay.
2
A.
Section 197 -- 179 expenses is a
3
separately stated item.
4
Q.
All right.
5
A.
Political contributions are not
6
deductible.
7
Q.
All right.
8
A.
That's all I can recall right now.
9
Q.
Subject to the adjustments which you've
Any other differences?
Any other differences?
Any other items?
10
just delineated for us, would you expect the net
11
income figure used on the 2006 federal income tax
12
return of State Street Consultants to be the same
13
as the net income figure reflected on Exhibit 11?
14
A.
Yes.
15
Q.
In fact, when you prepared the tax
16
return for State Street Consultants for 2006, was
17
your starting point this P&L statement, Exhibit
18
11?
19
A.
Possibly not.
20
Q.
What would have been your starting
21
point?
22
A.
23
accrual-based financial statement.
24
Q.
An accrual-based -- possibly an
Do you know that?
Thomas Rankin
January 5, 2009
247 1
A.
2
with accrual.
3
Q.
This is a cash-basis P&L, correct?
4
A.
That is correct.
5
Q.
Let me ask you now to turn your
6
attention to Exhibit 8.
7
is State Street Consultants, LLC, Balance Sheet as
8
of December 31, 2006.
9
reflected on Exhibit 8 the information you would
10
have utilized for Schedule L to the 2006 federal
11
income tax return of State Street Consultants?
12
A.
13
would need to look at the tax return to see if I
14
used an accrual-based balance sheet.
15
Q.
16
Consultants is a cash-basis taxpayer or an
17
accrual-basis taxpayer?
18
A.
19
cash-basis taxpayer.
20
Q.
21
cash-basis figures from the balance sheet to do
22
Schedule L on the tax return?
23
A.
Not necessarily.
24
Q.
You would just have to tax -- check the
I don't know for certain if we started
Excuse me.
8.
Exhibit 8
Is the information
This is a cash-basis balance sheet.
I
Do you know whether State Street
State Street Consultants is a
So wouldn't you be using these
Thomas Rankin
January 5, 2009
248 1
tax return to see what you did?
2
A.
Yes.
3
Q.
I think we are done with 8 and 11.
4
Let me ask you now to have before you,
5
if you would, Exhibits 10 and 12.
6
A.
Okay.
7
Q.
Would the net income figures that
8
appear on the profit and loss statement that is
9
Exhibit 12 be the same ones you would have used on
10
the 2007 federal income tax return for State
11
Street Consultants?
12
a minute.
13
A.
Okay.
14
Q.
Did you tell me that you did not -- or
15
that State Street Consultants did not file a 2007
16
federal income tax return?
17
A.
Correct.
18
Q.
So there was no entity return?
19
A.
Correct.
20
Q.
That was all picked up by Mr. Clark on
21
his personal income tax return?
22
A.
Schedule C.
23
Q.
Would the net income figures reflected
24
on Schedule C for Mr. Clark's 2007 federal income
Let me interrupt myself just
Thomas Rankin
January 5, 2009
249 1
tax return be the same as those reflected on
2
Exhibit 12, subject to that list of adjustments
3
you've already given us?
4
A.
Yes.
5
Q.
Since you didn't do an entity return
6
for SSC for 2007 but instead all of that was
7
picked up by Mr. Clark in his personal income tax
8
return filing, is there a schedule that
9
corresponds to Schedule L on the entity return?
10
A.
No.
11
Q.
Is there any place on Mr. Clark's
12
personal income tax return for 2007 that would
13
reflect balance sheet information of State Street
14
Consultants?
15
A.
No.
16
Q.
I think we're done with those two now.
17
Let me direct your attention to Exhibit
18
9.
19
Profit & Loss, January through December 2007.
20
I would like to ask you to flip over, if you
21
would, to page 3 of 3, down near -- excuse me.
22
First of all, do you have page 3 of 3, sir?
23
A.
Yes.
24
Q.
You're on the last page of the exhibit?
Exhibit 9 is State Street Partners, PLL, And
Thomas Rankin
January 5, 2009
250 1
A.
I am.
2
Q.
If you look down near the bottom of the
3
page, there is a line item for other income, and
4
an amount that appears to be $29,936.29.
5
see that?
6
A.
Yes.
7
Q.
Do you know what other income State
8
Street Partners had in 2007 that is reflected in
9
that line item?
Do you
10
A.
Yes.
11
Q.
What is that, please?
12
A.
That is income relating to the swap
13
transaction that State Street Partners entered
14
into to finance the building.
15
Q.
16
transaction.
17
A.
18
transaction is a derivative that is placed on the
19
open market to create a fixed income instrument in
20
a variable interest rate world.
21
Tell us what you mean by the swap
I'll do the best I can.
MR. BEHAL:
Swap
Pretty good.
22
Q.
23
Partners entered into such a transaction in 2007?
24
A.
Are you telling me that State Street
No.
Thomas Rankin
January 5, 2009
251 1
Q.
2
realized in 2007?
3
A.
4
understand, but it -- income of $29,936.29 was
5
realized in 2007.
6
Q.
7
undertaken?
8
A.
9
2003 through Fifth Third.
Are you saying that the income was
It's a very difficult transaction to
Do you know when the transaction was
It originated with the financing in
10
Q.
11
transaction.
12
A.
13
enters into a variable rate loan agreement.
14
Q.
With Fifth Third?
15
A.
With Fifth Third Bank.
16
Q.
All right.
17
A.
And in turn Fifth Third Bank goes into
18
the derivative market and sells a obligation for
19
the same principal amount at a different
20
fluctuating rate in order to create a fixed rate
21
environment for State Street Partners.
22
Q.
Keep going.
23
A.
That's the best I can do.
24
Q.
And you think that's complicated?
Tell me the structure of the
Enter into -- State Street Partners
Thomas Rankin
January 5, 2009
252 1
A.
To me it is.
2
Q.
I'm teasing you.
3
at 6:00 on a day we've been going all day, isn't
4
it?
5
A.
Right.
6
Q.
One other thing I want to ask you about
7
here.
8
please.
9
And it always will be. It's very complicated
Let me take you to page 2 of 3 if I may,
For that matter, we could have done 1
10
of 3, but let's stay on 2 of 3 since I directed
11
your attention there.
12
line on this page, probably four or five line
13
items from the bottom.
14
A.
Yes.
15
Q.
Are those the monthly increments that
16
total the 29,000 plus amount that we just looked
17
at together?
18
A.
Yes.
19
Q.
So that's income that was realized on a
20
monthly basis, correct?
21
A.
Yes.
22
Q.
I think those are all the questions I
23
have about that.
24
We have an "other income"
Do you see that?
Let's go off the record.
THE VIDEOGRAPHER:
We are off the
Thomas Rankin
January 5, 2009
253 1
record at 1810.
2
(A brief recess is taken.)
3
THE VIDEOGRAPHER:
4
We are back on the
record at 1817.
5
MR. CVETANOVICH:
6
all the questions I have at this time.
7
repeat something that we observed earlier in the
8
deposition, many of the documents that the
9
Plaintiffs sought from the defendants have not yet
Mr. Rankin, those are Just to
10
been produced.
11
almost certainly we will have some additional
12
questions for you, but until we get the documents
13
I think that's really all we can do.
14 15
When those documents are produced
I want to thank you for your time and attention.
I appreciate it very much.
16
THE WITNESS:
17
MR. WEAVER:
18
THE VIDEOGRAPHER:
19
deposition of Thomas Rankin.
20
witness has the right to review the videotape if
21
you wish to exercise your right at this time.
Okay. Thank you.
22
MR. WEAVER:
23
THE VIDEOGRAPHER:
24
record at 1818.
This concludes the At this time the
No. We are off the video
Thomas Rankin
January 5, 2009
254 1
- - - - -
2
Thereupon, the foregoing proceedings
3
concluded at 6:18 p.m.
4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
- - - - -
Thomas Rankin
January 5, 2009
255 1
State of Ohio
2
County of Franklin: SS
3
:
C E R T I F I C A T E
I, Cindy L. Knecht, a Notary Public in and for
4
the State of Ohio, do hereby certify the within
5
named Thomas A. Rankin was by me first duly sworn
6
to testify to the whole truth in the cause
7
aforesaid; testimony then given was by me reduced
8
to stenotypy in the presence of said witness,
9
afterwards transcribed by me; the foregoing is a
10
true record of the testimony so given; and this
11
deposition was taken at the time and place as
12
specified on the title page.
13
I do further certify I am not a relative,
14
employee or attorney of any of the parties hereto,
15
and further I am not a relative or employee of any
16
attorney or counsel employed by the parties
17
hereto, or financially interested in the action.
18
IN WITNESS WHEREOF, I have hereunto set my
19
hand and affixed my seal of office at Columbus,
20
Ohio, on January 6, 2009.
21
______________________________________________
22
Cindy L. Knecht, Notary Public - State of Ohio
23
My commission expires August 3, 2009.
24
Thomas Rankin
January 5, 2009
256 Witness Errata and Signature Sheet Spectrum Reporting LLC
Correction or Change Reason
333 East Stewart Avenue
1 - Misspelling
2 - Word
3 - Wrong Word
4 -
Code Omitted Columbus, Ohio 43206 Clarification Phone - 614-444-1000
Fax - 614-444-3340
5 - Other Correction (Please
explain) Email - [email protected]
R
Sheet
_____ of
_____ Page/Line
Correction, Addition, or Change
Reason Code
_________
_________________________________________
___________
_________
_________________________________________
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_________________________________________
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_________________________________________
___________
I, Thomas A. Rankin, have read the entire transcript of my deposition taken in this matter, or the same has been read to me.
I request that the changes noted on my
errata sheet(s) be entered into the record for the reasons indicated. Date ____________________
Signature
___________________________________________________________ The witness has failed to sign his deposition within the time allowed. Date ___________________
Signature
___________________________________________________________
IN THE COURT OF COMMON PLEAS OF FRANKLIN COUNTY, OHIO - - - - C. Paul Tipps and Public Policy Consultants, Inc., Plaintiffs, vs. Neil S. Clark, NSC, Inc., and State Street Consultants, LLC,
: : : : Case No. 08CVH-12-18090 Judge Lynch : : :
Defendants. : - - - - VIDEOTAPED DEPOSITION OF THOMAS A. RANKIN - - - - -
Taken at Bailey Cavalieri LLC 10 West Broad Street, 21st Floor Columbus, OH 43215 January 5, 2009, 10:18 a.m. - - - - Spectrum Reporting LLC 333 Stewart Avenue, Columbus, Ohio 43206 614-444-1000 or 800-635-9071 www.spectrumreporting.com - - - - -
Thomas Rankin
January 5, 2009
2 1
A P P E A R A N C E S
2
ON BEHALF OF PLAINTIFFS: 3
Bailey Cavalieri LLC 4
10 West Broad Street, 21st Floor Columbus, OH 43215
5
By Danny L. Cvetanovich, Esq. Sabrina C. Haurin, Esq.
6 7 8
ON BEHALF OF DEFENDANTS: Robert J. Behal Law Offices, LLC 501 South High Street
9
Columbus, OH 43215 By Robert J. Behal, Esq.
10 11 12
John M. Gonzales, Esq. ON BEHALF OF THE WITNESS: Isaac, Brant, Ledman & Teetor 250 East Broad Street
13
Columbus, OH
43215
By Mr. Mark R. Weaver, Esq. 14 15 16
ALSO PRESENT: Jeremy Dineen - Videographer C. Paul Tipps
17 18 19 20 21 22 23 24
Thomas Rankin
January 5, 2009
3 1 2
Monday Morning Session January 5, 2009, 10:18 a.m.
3
- - - - -
4
S T I P U L A T I O N S
5
- - - - -
6
It is stipulated by counsel in attendance that
7
the deposition of Thomas A. Rankin, a witness
8
herein, called by the Plaintiffs for
9
cross-examination, may be taken at this time by
10
the notary pursuant to notice, that said
11
deposition may be reduced to writing in stenotypy
12
by the notary, whose notes may thereafter be
13
transcribed out of the presence of the witness;
14
that proof of the official character and
15
qualification of the notary is waived.
16 17 18 19 20 21 22 23 24
- - - - -
Thomas Rankin
January 5, 2009
4 1
I N D E X
2
Examination By
3
Mr. Cvetanovich - Cross
Page 6
4
Plaintiff Exhibits
Page
5
2 - Notice
of federal tax lien
39
6
3 - Notice of federal tax lien
67
7
4 - SSC 12 Month Cash-Flow Report, 2006
206
5 - SSC 12 Month Cash-Flow Report, 2007
220
6 - SSC 12 Month Cash-Flow Report, 2007
231
7 - SSC 12 Month Cash-Flow Report, 2008
236
8 - SSC balance sheet, December 31, 2006
239
9 - State Street Partners Profit & Loss,
240
8
9
10
11
12
13
January through December 2007
14
10 - State Street Consultants balance sheet,
241
December 31, 2007 15
11 - State Street Consultants profit & loss, 16
January through December 2006
17
12 - State Street Consultants profit & loss, January through December 2007
18 19 20 21 22 23 24
(Exhibits attached to original transcript.)
242 243
Thomas Rankin
January 5, 2009
5 1
THE VIDEOGRAPHER:
2
record at 10:18.
3
their presence.
4
We are on the
Would counsel please announce
MR. CVETANOVICH:
Yes.
My name is Dan
5
Cvetanovich.
6
firm of Columbus, Ohio, and I'm here on behalf of
7
the Plaintiffs.
8 9
I'm with the Bailey Cavalieri law
MR. BEHAL:
I'm Bob Behal.
I'm here on
behalf of State Street Partners -- pardon me,
10
State Street Consultants, LLC, Neil S. Clark, and
11
NSC Consulting Corp.
12
MR. WEAVER:
I'm Mark Weaver from the
13
Columbus law firm Isaac Brant, Ledman and Teetor.
14
I represent the witness, Thomas Rankin.
15
- - - - -
16
THOMAS A. RANKIN
17
being first duly sworn, testifies and says as
18
follows:
19
MR. CVETANOVICH:
Before I put the
20
question to the witness, Bob, I have a question
21
for you.
22
note that you're here on behalf of State Street
23
Partners.
24
State Street Partners?
We did this the other day.
You did not
Do you intend to be here on behalf of
Thomas Rankin
January 5, 2009
6 1
MR. BEHAL:
2
MR. CVETANOVICH:
3
MR. BEHAL:
State Street Partners. Yes, sir.
Well, I don't think that
4
Paul has hired me to represent State Street
5
Partners, and he's the managing member, so --
6
managing partner, I should say.
7 8
MR. CVETANOVICH:
You are right, and I
stand corrected.
9
- - - - -
10
CROSS-EXAMINATION
11
BY MR. CVETANOVICH:
12
Q.
13
name, please.
14
A.
He's Mr. Weaver.
15
Q.
Excuse me.
16
Mark's full name.
17
Mr. Weaver, will you tell us your full
Mr. Rankin -- we know
Mr. Rankin, will you tell us your full
18
name, please.
19
A.
Thomas A. Rankin.
20
Q.
What does the A stand for?
21
A.
Andrew.
22
Q.
What is your date of birth?
23
A.
7-26-64.
24
Q.
What is your residential address?
Thomas Rankin
January 5, 2009
7 1
A.
2
43004.
3
Q.
4
from that address?
5
A.
No.
6
Q.
How long have you lived there?
7
A.
Nine years, about.
8
Q.
Have you ever been known by any names
9
other than Thomas A. Rankin?
996 Poppy Hills Drive, Blacklick, Ohio,
Do you have any present plans to move
10
A.
Tom.
11
Q.
Other than that, do you have any other
12
nicknames by which you're commonly known among
13
family members or friends?
14
A.
No.
15
Q.
Would you give us an overview, please,
16
of your postsecondary education, formal education.
17
A.
18
degree.
19
Q.
20
upon you?
21
A.
1986.
22
Q.
What degree is that?
23
A.
Bachelor's of business administration.
24
Q.
What is your profession currently,
Cleveland State University, four-year
In what year was your degree conferred
Thomas Rankin
January 5, 2009
8 1
Mr. Rankin?
2
A.
What do you mean?
3
Q.
What is your profession?
4
do for a living?
5
A.
I'm a CPA.
6
Q.
When did you receive your CPA
7
certification?
8
A.
1989, thereabouts.
9
Q.
Would you give us, please, an overview
10
of your public accounting experience.
11
A.
12
1992.
What do you
I was with Ernst & Whinney from 1987 to And then with Ciuni and Panichi from --
13
MR. BEHAL:
14
THE WITNESS:
Spell that. C-I-U-N-I and Panichi,
15
P-A-N-I-C-H-I, from 1992 to 1996.
16
Q.
17
1996?
18
A.
19
practice.
20
Q.
What was the name of the company?
21
A.
Paragon Advisors.
22
Q.
What was the nature of its business?
23
A.
We were chief financial officers for
24
wealthy families, outside chief financial
What did you do in your career then in
I worked for a company in a nonpublic
Thomas Rankin
January 5, 2009
9 1
officers.
2
Q.
What was your position at Paragon?
3
A.
Employee.
4
Q.
What kind of things did you do?
5
A.
Tax work, primarily.
6
Q.
How long were you there?
7
A.
1996 through 1999.
8
Q.
What did you do in your career then in
9
1999 when you left Paragon?
10
A.
Established my own practice.
11
Q.
Did you establish an accounting
12
practice?
13
A.
Tax.
14
Q.
Did you create some entity or have some
15
entity created through which you then conducted
16
your tax practice?
17
A.
Yes.
18
Q.
What was the name of the entity?
19
A.
Thomas A. Rankin & Co.
20
catchy.
21
Q.
22
still in existence?
23
A.
Yes.
24
Q.
Has it been in existence continuously
I like it.
It's pretty
Is Thomas A. Rankin & Co.
Thomas Rankin
January 5, 2009
10 1
since you had it created back in or about 1999?
2
A.
Yes.
3
Q.
Have you personally remained affiliated
4
with it continuously since the entity was created?
5
A.
Yes.
6
Q.
What is your capacity with Thomas A.
7
Rankin & Co.?
8
A.
Employee/owner.
9
Q.
Are you the sole owner of the business?
10
A.
Yes.
11
Q.
What is the nature of the business of
12
Thomas A. Rankin & Co.?
13
A.
Tax consultings.
14
Q.
Tax consulting?
15
A.
Yes.
16
Q.
Does it provide other kinds of
17
accounting services to its clients?
18
A.
Yes.
19
Q.
What other kinds of accounting
20
services?
21
A.
Bookkeeping.
22
Q.
All right.
23
A.
Tax preparation.
24
Q.
Anything else?
Bookkeeping. Anything else?
Thomas Rankin
January 5, 2009
11 1
A.
Payroll service.
2
Q.
Does Thomas A. Rankin & Co. provide any
3
auditing services to its clients?
4
A.
No.
5
Q.
How many employees does Thomas A.
6
Rankin & Co. have?
7
A.
One.
8
Q.
Just you?
9
A.
Yes.
10
Q.
What is the greatest number of
11
employees Thomas A. Rankin & Co. has had?
12
A.
Three.
13
Q.
When Thomas A. Rankin & Co. has had
14
more employees than just you, what were the
15
capacities of the others?
16
A.
Staff.
17
Q.
Were they nonprofessional employees?
18
A.
Be specific.
19
Q.
Were they accountants?
20
A.
No.
21
Q.
How many clients does Thomas A. Rankin
22
& Co. have currently?
23
A.
Approximately 80.
24
Q.
Is State Street Consultants, LLC, a
Thomas Rankin
January 5, 2009
12 1
client of Thomas A. Rankin & Co.?
2
A.
Yes.
3
Q.
For how long has that been the case?
4
A.
Seven years.
5
Q.
Is State Street Partners, PL -- what is
6
it, PLLP?
I'm not saying it right.
7 8
MR. BEHAL:
PLL, I think, isn't it?
PLL.
9
MR. CVETANOVICH:
PLL, thank you, Bob.
10
Q.
11
of Thomas A. Rankin & Associates[sic]?
12
A.
Yes.
13
Q.
For how long has that been the case?
14
A.
Seven years.
15
Q.
Is NSC Consulting Corporation a client
16
of Thomas A. Rankin & Co.?
17
A.
Yes.
18
Q.
For how long has that been the case?
19
A.
Nine years.
20
Q.
Do you know someone named Neil S.
21
Clark?
22
A.
Yes.
23
Q.
Is Neil S. Clark personally a client of
24
Thomas A. Rankin & Co.?
Is State Street Partners, PLL, a client
Thomas Rankin
January 5, 2009
13 1
A.
Yes.
2
Q.
For how long has that been the case?
3
A.
Nine years.
4
Q.
Do you know someone formerly known as
5
Toni Clark, a former spouse of Neil Clark?
6
A.
Yes.
7
Q.
Has she ever been a client of Thomas A.
8
Rankin & Associates?
9
A.
I don't recall.
10
Q.
Would Thomas A. Rankin & Associates
11
have books or records that you could consult which
12
would tell you whether Toni Clark was a client of
13
Thomas A. Rankin & Associates?
14
A.
Yes.
15
Q.
Can you tell me whether Toni Clark or
16
the former Toni Clark is currently a client of
17
Thomas A. Rankin & Associates?
18
A.
She is not.
19
Q.
Is it the case that she has not been a
20
client of Thomas A. Rankin & Associates at least
21
since she and Neil Clark were divorced?
22
A.
Yes.
23
Q.
Do you know someone named Kathy Clark,
24
another former spouse of Neil Clark?
Thomas Rankin
January 5, 2009
14 1
A.
Yes.
2
Q.
Was she ever a client of Thomas A.
3
Rankin & Associates?
4
A.
Individually?
5
Q.
Yes, sir.
6
A.
No.
7
Q.
During the time that she was married to
8
Neil Clark, was she a client of Thomas A. Rankin &
9
Associates?
10
A.
Yes.
11
Q.
Had she been a client of Thomas A.
12
Rankin & Associates before she and Neil Clark were
13
married?
14
A.
No.
15
Q.
Has she been a client of Thomas A.
16
Rankin & Associates at any time since Kathy Clark
17
and Neil Clark were divorced?
18
A.
No.
19
Q.
What manner of services does Thomas A.
20
Rankin & Associates provide to State Street
21
Consultants?
22
A.
Tax services.
23
Q.
Any other services?
24
A.
Bookkeeping services.
Thomas Rankin
January 5, 2009
15 1
Q.
Any other services?
2
A.
Payroll service, payroll tax service.
3
Q.
I want to make sure I understood your
4
last answer there, Mr. Rankin.
5
services and payroll tax services two different
6
categories?
7
A.
Yes.
8
Q.
Any other services that Thomas A.
9
Rankin & Associates provides to State Street
Are payroll
10
Consultants?
11
A.
General business service.
12
Q.
What does that mean exactly?
13
A.
Financial service, any general
14
business-type service.
15
Q.
Is that a consulting service?
16
A.
Yeah.
17
Q.
In -- in this category of general
18
business services, are there any specific tasks
19
apart from consulting with the management of SSC
20
that Thomas A. Rankin & Associates provides to
21
State Street Consultants?
22
A.
No.
23
Q.
Has the package of -- well, strike
24
that.
Not clear.
Let me ask the question this way.
Have
Thomas Rankin
January 5, 2009
16 1
these categories of services that your company
2
provides for SSC been the same throughout the
3
relationship?
4
A.
No.
5
Q.
In the beginning, which of these
6
services did Thomas A. Rankin & Associates not
7
provide to State Street Consultants?
8
A.
Payroll tax.
9
Q.
Any others?
10
A.
General business consulting.
11
Q.
Any others?
12
A.
No.
13
Q.
When did Thomas A. Rankin & Associates
14
begin to provide payroll tax services to State
15
Street Consultants?
16
A.
2006.
17
Q.
When did Thomas A. Rankin & Associates
18
begin to provide general business services to
19
State Street Consultants?
20
A.
21 22 23 24
2005, maybe. MR. BEHAL:
Are you guessing or do you
know? THE WITNESS:
I'm guessing it was
somewhere in that time period.
Thomas Rankin
January 5, 2009
17 1
Q.
2
nature of the payroll services that Thomas A.
3
Rankin & Associates provides to State Street
4
Consultants.
5
A.
6
payroll account, I initiate a transfer of funds to
7
pay to have State Street Consultants pay the
8
payroll tax.
9
Q.
Would you describe for us, please, the
When the money is available in the
Just a bit ago, Mr. Rankin, you told me
10
that the payroll services that your company
11
provides to State Street Consultants and the
12
payroll tax services that your company provides to
13
State Street Consultants are distinct categories.
14
And the question that I just asked you was:
15
you describe for us, please, the nature of the
16
payroll services that Thomas A. Rankin &
17
Associates provides to State Street Consultants.
18
Is what you just related to me something you
19
consider to be a payroll service and not a payroll
20
tax service?
21
A.
22
actual paying of the employees.
23
Q.
24
anything else?
I view the payroll service as the
Would
Does the payroll service encompass
Thomas Rankin
January 5, 2009
18 1
A.
Issuing W-2s.
2
Q.
Anything else?
3
A.
No.
4
Q.
Does State Street Consultants use a
5
payroll service other than the services of Thomas
6
A. Rankin & Associates?
7
A.
Yes.
8
Q.
Do you know the name of it?
9
A.
I don't remember.
10
Q.
Do you know for how long State Street
11
Consultants has used a payroll service other than
12
the services of Thomas A. Rankin & Associates?
13
A.
I don't know.
14
Q.
Is it the case that State Street
15
Consultants' payroll function is handled in part
16
by this payroll service and in part through the
17
services provided by your company?
18
A.
Yes.
19
Q.
What does the payroll service do for
20
State Street Consultants?
21
A.
Pays the employees.
22
Q.
Is there anything else the payroll
23
service does as part of its contribution to State
24
Street Consultants' overall payroll function?
Thomas Rankin
January 5, 2009
19 1
A.
2
payroll tax returns.
3
Q.
Anything else?
4
A.
Not that I know of.
5
Q.
I had asked you before to describe for
6
us the nature of the payroll services that your
7
company provides to State Street Consultants, and
8
you told me when the money is available in the
9
payroll account you initiate a transfer of funds
Prepares forms to be used to file
10
to pay to have State Street Consultants pay the
11
payroll tax.
12
anything else in the nature of payroll services
13
that your company provides to State Street
14
Consultants?
15
A.
I review the payroll tax return.
16
Q.
Is that a payroll service or is that a
17
payroll tax service?
18
A.
It's a tax form.
19
Q.
I'm just trying to understand in which
20
category you would put it, because you said there
21
were two different categories.
22
A.
23
paying the employees.
24
Q.
My question to you now is:
Right.
Is there
I view the payroll service as
All right.
And is there anything you
Thomas Rankin
January 5, 2009
20 1
haven't already described to me that your company
2
does in the nature of providing a payroll service
3
to State Street Consultants?
4
A.
Can you repeat that?
5
Q.
Yes, sir.
6
A.
Thank you.
7
Q.
Is there anything you haven't already
8
described to me that your company does in the
9
nature of providing a payroll service to State
I'm sorry.
10
Street Consultants?
11
A.
No.
12
Q.
Now let's move over to the category of
13
payroll tax services.
14
please, what payroll tax services your company
15
provides to State Street Consultants.
16
A.
17
instructed to do so, I will initiate a transfer of
18
funds to pay payroll tax obligations.
19
Q.
20
Rankin & Associates does for State Street
21
Consultants that you characterize as payroll tax
22
services?
23
A.
I review the payroll tax forms.
24
Q.
Anything else?
Can you describe for me,
When funds are available and I'm
Is there anything else that Thomas A.
Thomas Rankin
January 5, 2009
21 1
A.
I file the payroll tax forms.
2
Q.
Anything else?
3
A.
No.
4
Q.
This may seem very basic to you, but
5
just to be sure I understand your terminology,
6
what do you mean by payroll taxes?
7
A.
Withholdings and employer obligations.
8
Q.
What employer obligations?
9
A.
Social Security match, Medicare match,
10
Ohio unemployment, workers' comp.
11
Q.
Anything else?
12
A.
No.
13
Q.
So if we put these several categories
14
together, we would have what you've referred to as
15
payroll taxes?
16
A.
Yes.
17
Q.
Okay.
18
the nature of a couple of these categories.
19
you refer to withholdings, you're referring, are
20
you not, to moneys withheld from employee
21
paychecks to be remitted to taxing authorities?
22
A.
Yes.
23
Q.
So that's the employees' money, right?
24
A.
It's the government's.
I want to be sure I understand When
Thomas Rankin
January 5, 2009
22 1
Q.
2
ends up with everything.
3
it's withheld from employee paychecks, it is the
4
employee's money to then be remitted to the
5
government, correct?
6
A.
Yes.
7
Q.
And in addition to income taxes that
8
are withheld from employee paychecks, Social
9
Security taxes are also withheld from employee
Well, it is at a point.
The government
But at the point that
10
paychecks, correct?
11
A.
Yes.
12
Q.
And so that's the employee's money that
13
then has to be remitted to the government,
14
correct?
15
A.
Yes.
16
Q.
And that's the employer's obligation to
17
withhold it and remit, correct?
18
A.
Yes.
19
Q.
In addition to withholding Social
20
Security taxes, if you will, from employee
21
paychecks, the employer has an obligation to match
22
those amounts and then remit that to the
23
government as well, correct?
24
A.
Yes.
Thomas Rankin
January 5, 2009
23 1
Q.
2
Medicare taxes, is it not?
3
A.
Yes.
4
Q.
Now, just on a couple of these other
5
categories, my sense is they may be different, but
6
I want to hear that from you.
7
compensation taxes, are those withheld from the
8
employee paychecks?
9
A.
No.
10
Q.
So that's just an employer obligation,
11
correct?
12
A.
Yes.
13
Q.
And then workers' compensation
14
premiums, those are not withheld from employee
15
paychecks either, correct?
16
A.
Correct.
17
Q.
Paying workers' compensation premiums
18
is the obligation of the employer, correct?
19
A.
Yes.
20
Q.
With regard to the categories of
21
payroll taxes as we've just gone through them that
22
are withheld from employee paychecks, at the point
23
of withholding, those funds are immediately
24
available to be remitted to the government,
And the same thing is true with
Ohio unemployment
Thomas Rankin
January 5, 2009
24 1
correct?
2
A.
Unless the money's not in the account.
3
Q.
Isn't the money supposed to be in the
4
account since it is money that's being withheld
5
from an employee paycheck?
6
MR. BEHAL:
Objection.
Calls for a
7
legal conclusion, but you can answer.
8
Q.
You may respond.
9
A.
Yes.
10
Q.
And when the employer withholds that
11
money, it is withholding the money from the
12
employee paycheck for the purpose of then
13
remitting the money to the government, correct?
14
A.
Yes.
15
Q.
You said to me a few moments ago,
16
Mr. Rankin, and this was when you were describing
17
for me the payroll tax services that your company
18
provides to State Street Consultants, you said:
19
When funds are available and I'm instructed to do
20
so, I will initiate a transfer of funds to pay
21
payroll tax obligations.
22
Who is it at SSC, State Street
23
Consultants, that gives you such instructions?
24
A.
Neil Clark.
Thomas Rankin
January 5, 2009
25 1
Q.
Anyone else?
2
A.
No.
3
Q.
In the relationship that Thomas A.
4
Rankin & Associates has with State Street
5
Consultants, are you authorized to initiate such a
6
transfer of funds without receiving the directive
7
from Mr. Clark?
8
A.
No.
9
Q.
When such directives are forthcoming
10
from Mr. Clark, are they initiated by him, or is
11
it instead a situation where you go to him and
12
say, Mr. Clark, or, Neil, this is due, shall I
13
transfer?
14
A.
Can you repeat that?
15
Q.
Yes.
16
you and Mr. Clark interact and how you interact
17
which then gives rise to him saying, transfer the
18
money.
19
That's what it boils down to.
20
A.
I would go to him.
21
Q.
Is it the case that it's your
22
responsibility to keep track of when remittances
23
of withholding taxes are due?
24
A.
I'm sorry.
I'm just trying to understand how
Does he come to you or do you go to him?
No.
Thomas Rankin
January 5, 2009
26 1
Q.
Whose responsibility is that?
2
A.
Payroll service.
3
Q.
The outside company that State Street
4
Consultants uses?
5
A.
Yes.
6
Q.
Does it issue reminders, to your
7
knowledge, to State Street Consultants of when
8
various withholding taxes must be remitted?
9
A.
Yes.
10
Q.
Are those written notices or reminders
11
from the payroll services company?
12
A.
Yes.
13
Q.
Do you know how they're transmitted?
14
A.
With each payroll run.
15
Q.
Are they transmitted electronically?
16
A.
No.
17
Q.
Is there a piece of paper that is in
18
the nature of a notice that comes along with the
19
payroll run?
20
A.
Yes.
21
Q.
Do you see those notices?
22
A.
They are given to me.
23
Q.
They are received initially by someone
24
at State Street Consultants?
Thomas Rankin
January 5, 2009
27 1
A.
Yes.
2
Q.
Who is that someone?
3
A.
Jane Harrison.
4
Q.
Is it Ms. Harrison who then gives them
5
to you?
6
A.
Yes.
7
Q.
Is it the practice that she directs
8
them to you or is to direct them to you each time
9
such a notice is received?
10
A.
I don't know.
11
Q.
Is that how it tends to work out?
12
A.
I don't know.
13
Q.
When you receive those notices, what do
14
you do with them?
15
A.
Hold them.
16
Q.
Do you read them?
17
A.
Yes.
18
Q.
For what purpose do you read them?
19
A.
To identify when payroll taxes are due.
20
Q.
Once you have noted that from the
21
notices, do you do anything in the nature of
22
verifying the correctness of the information on
23
the notice?
24
A.
No.
Thomas Rankin
January 5, 2009
28 1
Q.
2
Street Consultants are relying on the payroll
3
service to have it correct?
4 5
MR. BEHAL: Q.
6 7
Objection.
You may respond. MR. BEHAL:
As to whether he can speak
for SSC.
8 9
Is it fair to say that you and State
MR. CVETANOVICH: objection.
That's a fair
Let me break the question into two
10
pieces.
11
Q.
12
upon the payroll service to have that information
13
correct?
14
A.
Yes.
15
Q.
Once you get such notice, you look at
16
such a notice, what do you do?
17
A.
Put it on my desk.
18
Q.
Is there any action that you take in
19
response to receiving such a notice?
20
A.
Not until the tax is due.
21
Q.
Is the due date for the tax different
22
for the various categories that we went through
23
just a bit ago?
24
A.
Is it fair to say that you are relying
Yes.
Thomas Rankin
January 5, 2009
29 1
Q.
Do you know all those due dates?
2
A.
The form -- the form dictates the due
3
date.
4
Q.
5
due date?
6
A.
Sure.
7
Q.
And do the due dates differ for various
8
categories?
9
A.
Yes.
10
Q.
When you get one of these notices
11
through the payroll service and Ms. Harrison, do
12
you then compute due dates?
13
A.
I don't know what you mean.
14
Q.
Well, you get the information from the
15
payroll service.
16
frames within which moneys have to be remitted to
17
various taxing authorities, correct?
18
A.
Yes.
19
Q.
And you know where to find those time
20
frames.
21
A.
Yes.
22
Q.
What I'm trying to understand is when
23
you get such a notice from the payroll service
24
through Ms. Harrison, do you then sit down, or
So you know where to look to find the
You know that there are time
Did you say they're on the forms, right?
Thomas Rankin
January 5, 2009
30 1
stand up, for that matter, and pin down what the
2
due dates are on the various remittances that need
3
to be made so that you can docket them or put them
4
on a calendar or in some kind of a follow-up
5
system to assure that payments get made timely?
6
A.
I leave the notice on my desk.
7
Q.
Does the notice itself, though, tell
8
you the due dates for the various categories of
9
what you've called withholding taxes or payroll
10
taxes?
11
A.
Yes.
12
Q.
Do you review the notices on your desk
13
periodically?
14
A.
Yes.
15
Q.
Do you come in and look at the notices
16
every single day?
17
A.
No.
18
Q.
How often do you look at the notices to
19
see what's due or what's coming due?
20
A.
I don't -- I don't remember.
21
Q.
You don't know what your normal
22
practice is?
23
A.
I look at things on my desk.
24
Q.
Pretty much every day?
Thomas Rankin
January 5, 2009
31 1
A.
Yes.
2
Q.
When you see that one or another of
3
these categories of payroll taxes is coming due,
4
what then do you do?
5
A.
6
account to pay the payroll tax.
7
Q.
8 9
I will ask if there's money in the
Who do you ask? MR. BEHAL:
With regard to SSC or
generally?
10
MR. CVETANOVICH:
11
MR. BEHAL:
SSC.
Thank you.
12
A.
I'll ask Jane or Neil.
13
Q.
Jane being Jane Harrison?
14
A.
Yes.
15
Q.
And Neil being Mr. Clark?
16
A.
That's correct.
17
Q.
If the money's not there but the tax is
18
due, what do you do?
19
A.
I don't initiate a transfer.
20
Q.
Couldn't do that, could you?
21
A.
No.
22
Q.
Could you do anything else?
23
anything else?
24
A.
No.
Do you do
Thomas Rankin
January 5, 2009
32 1
Q.
2
automatically initiate a transfer?
3
A.
Yes.
4
Q.
Do you need to secure Mr. Clark's
5
authorization first?
6
A.
No.
7
Q.
Are you a signatory on any of State
8
Street Consultants' banking accounts?
9
A.
No.
10
Q.
What banking accounts does State Street
11
Account -- excuse me, State Street Consultants
12
have?
13
A.
I don't know.
14
Q.
Are you aware of any instances during
15
the time that you and your company have had a
16
relationship with State Street Consultants when it
17
was delinquent in remitting payroll taxes?
18
A.
19
missed the first part of that.
20
Q.
21
instances during the time that you and your
22
company have had a relationship with State Street
23
Consultants when it was delinquent in remitting
24
payroll taxes?
If the money is there, do you
Can you say that again?
That's all right.
I'm sorry.
I
Are you aware of any
Thomas Rankin
January 5, 2009
33 1
A.
Yes.
2
Q.
How many times has that happened?
3
A.
I don't know exactly.
4
Q.
What's your best estimate?
5
A.
My guess?
6
Q.
Estimate.
7
A.
Estimate?
8
Q.
Yes, sir.
9
MR. BEHAL:
Objection.
10
Q.
You may respond.
11
A.
Forty.
12
Q.
What categories of payroll taxes has
13
State Street Consultants been delinquent in
14
remitting during the time that you've had a
15
relationship with them?
16
A.
Payroll taxes delinquent?
17
Q.
Yes, sir.
18
A.
Federal, state, local.
19
Q.
Any other categories?
20
A.
Not that I remember.
21
Q.
How about Social Security taxes?
22
A.
That would fall under federal.
23
Q.
All right.
24
fall under federal?
What categories?
How about Medicare?
Also
You need to say yes or no.
Thomas Rankin
January 5, 2009
34 1
A.
Yes.
2
Q.
How about workers' compensation
3
premiums?
4
A.
I don't remember.
5
Q.
How about unemployment compensation
6
taxes?
7
A.
I don't know.
8
Q.
Are you aware of any instance when
9
State Street Consultants failed to timely remit
10
payroll taxes to the taxing authorities when it
11
had money available to pay the taxes?
12
A.
No.
13
Q.
Are you familiar with something known
14
as 431 taxes?
15
A.
No.
16
Q.
No?
17
A.
Can I get a little water?
18
Q.
Oh, sure, by all means.
19 20
I don't remember.
THE VIDEOGRAPHER:
MR. CVETANOVICH:
22
THE VIDEOGRAPHER:
24
Do you want to go
off the record?
21
23
Sure.
We may. We are off the
record at 11:02. (A brief recess is taken.)
Thomas Rankin
January 5, 2009
35 1
THE VIDEOGRAPHER:
We are back on the
2
record at 11:10.
3
Q.
4
off-the-record discussion with your counsel,
5
Mr. Weaver, he indicated to me that you would like
6
to clarify some of the things you said to me
7
before we took our break.
8
ahead and do that.
9
A.
Mr. Rankin, during a brief
Why don't you just go
I wanted to clarify the authority I
10
have to pay -- or to initiate a payroll tax
11
transfer, in that I have a blanket authority to
12
initiate the transfer if there's funds in the
13
account, and I re -- I ask Ms. Harrison if funds
14
are in the account to be able to initiate the
15
transfer.
16
Q.
17
clarify?
18
A.
19
if I do any other services or perform any other
20
services relating to payroll tax.
21
contact with the IRS relating to State Street
22
Consultants' delinquent taxes.
23
Q.
24
your complete answer?
Is there anything else you'd like to
I have -- on payroll tax you asked me
I have been in
When you say -- excuse me.
Is that
Thomas Rankin
January 5, 2009
36 1
A.
Yes.
2
Q.
Anything else you want to clarify?
3
A.
No.
4
Q.
Okay.
5
contact with the IRS on State Street Consultants'
6
delinquent taxes, in what capacity have you made
7
such a contact or been part of such a contact with
8
the Internal Revenue Service?
9
A.
When you say you've been in
Under a power of attorney State Street
10
Consultants has granted me the authority to
11
discuss payroll tax issues with them.
12
Q.
13
as Section 941 taxes?
14
A.
I don't think it's Section 941.
15
Q.
All right.
16
something known as 941 taxes?
17
A.
Yes.
18
Q.
Good.
19
A.
That refers to the form.
20
Q.
Okay.
21
A.
941 refers to the form number.
22
taxes that are included on that form are federal
23
withholding, Social Security withholding, Medicare
24
withholding, employer match for both Social
Are you familiar with something known
Are you familiar with
I was hoping --
Tell me what 941 taxes are. The
Thomas Rankin
January 5, 2009
37 1
Security and Medicare.
2
Q.
3
taxes as you described them earlier?
4
A.
Yes.
5
Q.
To your knowledge, has there ever been
6
a tax assessment against State Street Consultants
7
for delinquency in payment of 941 taxes?
8
A.
Yes.
9
Q.
How many times has that occurred?
10
A.
Can you repeat the -- you're kind of
11
mixing the first question and the second question.
12
The first question?
13
Q.
14
knowledge, have there -- or has there ever been a
15
tax assessment against State Street Consultants
16
for delinquency in payment of 941 taxes?
17
answer was yes.
18
How many times has that occurred?
19
A.
Two.
20
Q.
When were those two instances of tax
21
assessments against State Street Consultants?
22
A.
I don't remember.
23
Q.
Has it been during calendar year 2008?
24
A.
I don't remember.
So it's all of the federal payroll
Yes.
The first question was:
To your
Your
And then my next question was:
Thomas Rankin
January 5, 2009
38 1
Q.
Was it during calendar year 2007?
2
A.
Don't remember when the assessment was
3
made.
4
Q.
5
within the past three years?
6
A.
Yes.
7
Q.
Has State Street Consultants yet paid
8
those taxes that it was delinquent in paying?
9
A.
Not that I'm aware of.
10
Q.
In addition to having the obligation to
11
pay those taxes, is it also going to be required
12
to pay interest on the amounts that it was
13
delinquent in paying?
14
A.
That hasn't been determined.
15
Q.
Is the assessment for the amount of the
16
tax that's due plus interest?
17
A.
Yes.
18
Q.
And is the assessment also inclusive of
19
some penalty?
20
A.
Yes.
21
Q.
Is State Street Consultants contesting
22
the assessment?
23
A.
No.
24
Q.
Do you know the total amount of the
Do you know at least that it's been
Thomas Rankin
January 5, 2009
39 1
assessment?
2
A.
I don't recall.
3
Q.
Do you know to what time periods it
4
relates?
5
A.
December 2006 through December 2007.
6
Q.
Do you know if the Internal Revenue
7
Service has issued a notice of a federal tax lien
8
on State Street Consultants?
9
A.
Yes.
10
Q.
Do you know if the Internal Revenue
11
Service has issued a federal tax lien against Neil
12
S. Clark?
13
A.
Yes.
14
Q.
Has it?
15
A.
Yes.
16 17
MR. CVETANOVICH: stickers.
18
Plaintiffs. - - - - -
19 20
We need some
Thereupon, Plaintiffs' Exhibit 2 is marked for purposes of identification.
21
- - - - -
22
Q.
23
document that's been marked Plaintiffs' Exhibit 2.
24
Mr. Rankin, I want to hand you a
MR. CVETANOVICH:
One for you, Bob.
Thomas Rankin
January 5, 2009
40 1
MR. BEHAL:
2
MR. CVETANOVICH:
Thank you, sir. You're welcome.
3
Q.
4
and look at it and see if you recognize it, and
5
then I'll perhaps have a couple of questions for
6
you about that.
7
this -- call your attention to the fact that this
8
is a two-sided exhibit.
9
bears a certification.
And I'll ask you to just take a minute
And let me -- lest I fail to do
The back of the exhibit And you can see what that
10
says there, but take a look and just tell me if
11
you recognize it.
12
A.
Yes.
13
Q.
Had a chance to look at that now, sir?
14
A.
Yes.
15
Q.
Do you recognize it?
16
A.
Yes.
17
Q.
Would you tell us for the record what
18
it is, please.
19
A.
Notice of federal tax lien.
20
Q.
And it is a notice of a lien against
21
what taxpayer?
22
MR. BEHAL:
23
itself.
24
A.
Objection.
Go ahead and answer. Neil S. Clark.
It speaks for
Thomas Rankin
January 5, 2009
41 1
Q.
2
delinquencies that you just described for us?
3
A.
Yes.
4
Q.
And does this reflect, over in the
5
right-hand column there where it says unpaid
6
balance of assessment, the amount that IRS is
7
claiming is -- is owed?
8
A.
Yes.
9
Q.
Does it also reflect in one of the
Does this relate to the 941 tax
10
columns there on the form the tax periods for
11
which the assessments relate or to which the
12
assessments relate?
13
A.
Yes.
14
Q.
Is it the case, Mr. Rankin, that during
15
the entire year of 2007 State Street Consultants
16
did not make any remittances of 941 taxes?
17
A.
I don't recall.
18
Q.
Isn't that what you would glean from
19
this form?
20
A.
21
they didn't make any payments.
22
reflected in there.
23
Q.
24
they made some payments, but this form reflects
It depends on what payroll is as to if
All right.
Payments could be
So you're saying perhaps
Thomas Rankin
January 5, 2009
42 1
that they were short, so to speak, in the payments
2
they made by the amounts reflected on the form,
3
correct?
4
A.
Yes.
5
Q.
Do you know if State Street Consultants
6
remitted any 941 taxes during 2007?
7
A.
I don't recall.
8
Q.
Are there documents that you could
9
consult which would tell you the answer to that
10
question?
11
A.
Yes.
12
Q.
What documents?
13
A.
Check register.
14
Q.
SSC's check register?
15
A.
Yes.
16
Q.
Is that an online check register?
17
A.
No.
18
Q.
It's just an old-fashioned checkbook?
19
A.
It's in the computer.
20
Q.
All right.
21
maintained tax register -- or check register?
22
Excuse me.
23
A.
Check register.
24
Q.
Yes?
So it's an electronically
Thomas Rankin
January 5, 2009
43 1
A.
Yes.
2
Q.
Who is the custodian of that?
3
A.
Ms. Harrison.
4
Q.
Do you have regular access to it?
5
A.
No.
6
Q.
Do you have access to State Street
7
Consultants' computerized financial records
8
system?
9
A.
No.
10
Q.
Are you familiar with what kind of
11
accounting software State Street Consultants uses?
12
A.
I'm not familiar with the system.
13
Q.
If you need access to information
14
that's maintained in that system, how do you go
15
about getting that?
16
A.
Request it of Ms. Harrison.
17
Q.
To your knowledge, does Ms. Harrison
18
have the authority to give you access to the
19
financial information of State Street Consultants?
20
A.
Yes.
21
Q.
Where are the offices of Thomas A.
22
Rankin & Associates housed?
23
A.
Two offices.
24
Q.
Where are they located?
Thomas Rankin
January 5, 2009
44 1
A.
2
and -- I think that's it about now.
3
Q.
4
you only gave me one address and then said, well,
5
you think that's about it now or that's it about
6
now.
7
A.
8
misspoke.
9
Q.
996 Poppy Hills Drive, Blacklick, Ohio,
Okay.
You said two offices, but then
Why did you give me that kind of an answer? I no longer have two offices.
All right.
I
Up until very recently you
10
did have two offices?
11
A.
Yes.
12
Q.
Poppy Hills Drive, Blacklick, Ohio,
13
what's the nature of the structure there that
14
houses your office at that address?
15
A.
What's the nature of the --
16
Q.
Structure.
17
A.
It's my residence.
18
Q.
So you have an office in your home?
19
A.
Yes.
20
Q.
And then in addition to that, at least
21
until recently, you had another office?
22
A.
Yes.
23
Q.
Was that at 137 East State Street?
24
A.
Yes.
Thomas Rankin
January 5, 2009
45 1
Q.
2
that location?
3
A.
When did you cease to have an office at
December 30th.
4
MR. BEHAL:
5
THE WITNESS:
No.
It's a Tuesday. It's a Tuesday?
December
6
27th?
7
Q.
2008?
8
A.
Yes.
9
Q.
Why did you close your office at 137
I don't recall exactly what date.
10
East State Street in late December of 2008?
11
A.
12
the premises.
13
Q.
14
Associates' office at 137 East State Street was
15
within the State Street Consultants office
16
complex?
17
A.
Yes.
18
Q.
Did Thomas A. Rankin & Associates lease
19
that space?
20
A.
No.
21
Q.
Under what kind of an arrangement did
22
Thomas A. Rankin & Co. occupy that space?
23
A.
24
services for State Street Consultants.
State Street Consultants was vacating
Is it the case that Thomas A. Rankin &
I was provided a facility to perform my
Thomas Rankin
January 5, 2009
46 1
Q.
2
Associates did not pay rent for that space?
3
A.
Yes.
4
Q.
How long did Thomas A. Rankin &
5
Associates occupy that space?
6
A.
2007.
7
Q.
So for all of 2007 and all of 2008, up
8
till the last couple of days?
9
A.
Yes.
10
Q.
On what floor of the building was the
11
space located that Thomas A. Rankin & Associates
12
occupied?
13
A.
Second floor.
14
Q.
Does Thomas A. Rankin & Associates
15
charge State Street Consultants fees for its
16
professional services?
17
A.
Not directly.
18
Q.
How does Thomas A. Rankin & Associates
19
receive payment for the professional services it
20
provides to State Street Consultants?
21
A.
22
Corporation.
23
Q.
24
retainer, monthly retainer?
Is it the case that Thomas A. Rankin &
Retainer through NSC Consulting
Is that an annual retainer, semi-annual Just how does that
Thomas Rankin
January 5, 2009
47 1
work?
2
A.
Quarterly retainer.
3
Q.
What is the quarterly amount of the
4
retainer?
5
A.
14,000.
6
Q.
So the -- as I understand what you've
7
told me, the professional services that Thomas A.
8
Rankin & Associates provides to State Street
9
Consultants are covered by a portion of that
10
quarterly retainer that Thomas A. Rankin &
11
Associates receives from NSC Consulting Corp.,
12
true?
13
A.
Yes.
14
Q.
Is payment for the professional
15
services that Thomas A. Rankin & Associates
16
provides to NSC Consulting group also covered by
17
that retainer?
18
A.
I'm sorry.
19
Q.
Sure.
20
A.
Please.
21
Q.
Is payment for the professional
22
services that Thomas A. Rankin & Associates
23
provides to NSC Consulting group also covered by
24
that retainer?
I was -- go ahead.
Sorry.
Thomas Rankin
January 5, 2009
48 1
A.
Yes.
2
Q.
Is the same true for the professional
3
services that Thomas A. Rankin & Associates
4
provides to State Street Partners?
5
A.
Yes.
6
Q.
Is the same true for the professional
7
services that Thomas A. Rankin & Associates
8
provides to Neil Clark?
9
A.
Yes.
10
Q.
Is NSC Consulting Corp. given a credit
11
against the quarterly retainer in the amount of
12
the value of the occupancy that Thomas A. Rankin &
13
Associates has had at 137 East State Street?
14 15
MR. BEHAL: meant to say, probably.
16 17
MR. CVETANOVICH:
MR. BEHAL: Q.
Okay.
Let me read the question again.
20 21
I actually did say
NSC.
18 19
NSC Consulting Corp. you
THE WITNESS:
She probably corrected
you.
22
MR. CVETANOVICH:
23
and pieces.
24
Q.
It came out in bits
No, she wouldn't do that. Let me read the question again.
Thomas Rankin
January 5, 2009
49 1
A.
Okay.
2
Q.
Is NSC Consulting Corp. given a credit
3
against the quarterly retainer in the amount of
4
the value of the occupancy that Thomas A. Rankin &
5
Associates has had at 137 East State Street?
6
A.
No.
7
Q.
Was the value of that occupancy of
8
space at 137 East State Street taken into account
9
when the quarterly retainer amount was negotiated?
10
A.
I don't remember.
11
Q.
For how long has the payment mechanic
12
to your firm for the services it provides to these
13
several entities been this quarterly retainer
14
arrangement?
15
A.
Quarterly retainer, 2007.
16
Q.
So for 2007 and 2008, the arrangement
17
has been what you've described?
18
A.
Uh-huh.
19
Q.
Yes?
20
Yes.
How was your firm paid for services to
21
these several entities back in 2006?
22
A.
Monthly retainer.
23
Q.
Did that retainer also come from NSC
24
Consulting Corp.?
Thomas Rankin
January 5, 2009
50 1
A.
Yes.
2
Q.
How much was the monthly amount back in
3
2006?
4
A.
I don't recall.
5
Q.
How much was the quarterly retainer in
6
2007?
7
A.
14,000.
8
Q.
And then it stayed the same in 2008?
9
A.
Yes.
10
Q.
Are you going to be occupying space in
11
State Street Consultants' new offices when they
12
move into new offices?
13
A.
No.
14
Q.
At that point will you work -- saying
15
you, now, I mean Thomas A. Rankin & Associates,
16
work only from the office you maintain in your
17
home?
18
A.
I don't know.
19
Q.
What is your near-term plan for the
20
space you will occupy when you are performing the
21
services that you provide to NSC, SSC, and SSP?
22
A.
Can you ask that again?
23
Q.
Yes.
24
I'm sorry.
Let me come at it this way.
You've indicated to me that for some
Thomas Rankin
January 5, 2009
51 1
time now Thomas A. Rankin & Associates has
2
occupied space at 137 East State Street to
3
facilitate it providing services to NSC Consulting
4
Corp., State Street Consultants, State Street
5
Partners, and -- and even Mr. Clark.
6
indicated to me that you've now moved out of 137
7
East State Street.
8
the near term, where, physically where, will
9
Thomas A. Rankin & Associates reside as it
My question is:
You've also
At least for
10
provides professional services to NSC, SSC, SSP,
11
and Mr. Clark?
12
A.
996 Poppy Hills.
13
Q.
Do you know for how long that state of
14
affairs will continue or is projected to continue?
15
A.
No.
16
Q.
Do you have an understanding of where
17
State Street Consultants is relocating its
18
offices?
19
A.
Yes.
20
Q.
Where is that going to be?
21
A.
49 South Grant Street, Columbus.
22
Q.
Do you know when that will be
23
effective?
24
A.
No.
Thomas Rankin
January 5, 2009
52 1
Q.
2
space now, to your knowledge?
3
A.
Yes.
4
Q.
Do you know for how long State Street
5
Consultants is planning to occupy that space?
6
A.
No.
7
Q.
Do you know if there is a plan that at
8
a point State Street Consultants will relocate its
9
professional offices?
10
A.
11
Is State Street Consultants in that
No. MR. BEHAL:
Was the question does he
12
know whether State Street Consultants is going to
13
relocate, is that what the question was?
14
sorry.
15
Q.
16
is a plan --
17
The question was:
MR. BEHAL:
I'm
Do you know if there
Okay.
18
Q.
19
Consultants will relocate its professional
20
offices?
-- that at a point State Street
21
MR. BEHAL:
22
MR. CVETANOVICH:
23
MR. BEHAL:
24
is a plan.
So the answer is no -The answer was "no."
-- you do not know if there
Thomas Rankin
January 5, 2009
53 1
THE WITNESS:
2
MR. BEHAL:
No. Okay.
Thank you.
I just
3
want to make sure I --
4
Q.
5
office at Thomas A. Rankin & Associates at some as
6
yet undetermined point in the future?
7
A.
I don't have a plan.
8
Q.
Have you had any discussions with
9
Mr. Clark or anyone else at State Street
Do you have a plan for opening another
10
Consultants about there coming a time or there
11
coming a point when you will again have office
12
space together with State Street Consultants?
13
A.
No.
14
Q.
Have you had a discussion with
15
Mr. Clark about the prospect of him winding up or
16
terminating the business of State Street
17
Consultants?
18
A.
Yes.
19
Q.
To your knowledge, does he have a plan
20
of winding up or terminating the business of State
21
Street Consultants?
22
A.
No.
23
Q.
Has Mr. Clark discussed with you a plan
24
that he has or an idea that he has for starting a
Thomas Rankin
January 5, 2009
54 1
new entity through which to conduct his lobbying
2
business?
3
A.
4
sorry.
5
Q.
Certainly.
6
A.
Thank you.
7
Q.
Has Mr. Clark discussed with you a plan
8
that he has or an idea that he has for starting a
9
new entity through which to conduct his lobbying
Can you repeat the question?
I'm
10
business?
11
A.
No.
12
Q.
Has Mr. Clark discussed with you a plan
13
that he has or an idea that he has for moving the
14
lobbying that he personally does out of State
15
Street Consultants into NSC Consulting Corp.?
16
A.
No.
17
Q.
Has he discussed with you a plan that
18
he has or an idea that he has for himself doing
19
lobbying work through some entity other than State
20
Street Consultants?
21
A.
Yes.
22
Q.
What discussions have you had with
23
Mr. Clark about that?
24
MR. BEHAL:
I'm going to object on the
Thomas Rankin
January 5, 2009
55 1
grounds of relevancy.
2
Q.
You may respond.
3
A.
I don't recall exactly the discussion.
4
Q.
Tell me as much as you can recall.
5
A.
I recall -- I recall Neil discussing
6
the possibility of working as a lobbyist outside
7
of State Street Consultants.
8
Q.
Do you recall any more than that?
9
A.
I recall Neil stating he would not be a
10
tenant of State Street Partners, if that's
11
relevant to that.
12
Q.
What else can you recall?
13
A.
Can't recall much right now.
14
Q.
When did you and Mr. Clark discuss
15
that?
16
A.
I don't remember exactly.
17
Q.
Was it in 2008?
18
A.
Yes.
19
Q.
The latter half of 2008?
20
A.
Yes.
21
Q.
The last quarter of 2008?
22
A.
Yes.
23
Q.
Within the past month?
24
A.
Yes.
Thomas Rankin
January 5, 2009
56 1
Q.
2
discussed that subject matter within the last
3
month?
4
A.
I don't recall.
5
Q.
More than once?
6
A.
Yes.
7
Q.
As many as five times?
8
A.
Maybe.
9
Q.
Has anybody else been a party to any of
How many times have you and Mr. Clark
10
those discussions between you and Mr. Clark?
11
A.
Yes.
12
Q.
Who else?
13
A.
Bob Behal.
14
Q.
Anyone else?
15
A.
Andrew Minton.
16
Q.
Anyone else?
17
A.
Not that I recall.
18
Q.
Have those discussions all been in
19
person?
20
A.
No.
21
Q.
Some in person?
22
A.
Yes.
23
Q.
Where did those occur?
24
A.
Easton Starbucks.
Thomas Rankin
January 5, 2009
57 1
Q.
2
there been multiple discussions in person?
3
A.
More than one.
4
Q.
How many?
5
A.
Don't recall exactly.
6
Q.
Was that between you and Mr. Clark?
7
A.
No.
8
Q.
Who was in attendance at those Easton
9
Starbucks discussions?
Is that a single discussion, or have
10
A.
Andrew Minton.
11
Q.
Excuse me.
12
and you?
13
A.
Yes.
14
Q.
Anyone else at the in-person
15
discussions at Starbucks?
16
A.
No.
17
Q.
Have there been any in-person
18
discussions other than those at the Easton
19
Starbucks?
20
A.
Not that I can recall.
21
Q.
The discussions you've had that have
22
not been in person, I take it were telephonic.
23
that correct?
24
A.
Yes.
Lisa Rankin.
Andrew Minton, Lisa Rankin
Is
Thomas Rankin
January 5, 2009
58 1
Q.
2
there been?
3
A.
Don't recall exactly.
4
Q.
Have those been two-person telephone
5
discussions or multiple-person telephone
6
discussions?
7
A.
Both.
8
Q.
The two-person discussions were between
9
you and what other person?
How many of those discussions have
10
A.
Neil Clark.
11
Q.
How many of those have there been?
12
A.
Several.
13
Q.
Several being what, more than three?
14
A.
It would be a guess.
15
Q.
When you say several, what do you
16
typically intend to connote by your --
17
A.
Three.
18
Q.
-- your use of that term?
19
A.
Sure.
20
Q.
When there have been more than you and
21
Mr. Clark on the phone, who else has been on the
22
call?
23
A.
Bob Behal.
24
Q.
How many of those have there been?
Three?
Thomas Rankin
January 5, 2009
59 1
A.
A couple.
2
Q.
Have there been any other discussions
3
within the past month on this subject matter that
4
have occurred but that you have not been
5
referencing in the discussion we just had of
6
telephone calls and Easton Starbucks meetings?
7
A.
Not that I recall.
8
Q.
Apart from the discussions, whether in
9
person or telephonic, have there been e-mail
10
communications between you and anyone else
11
regarding this topic?
12
A.
Not that I remember.
13
Q.
Have there been text messages or
14
instant messages between you and anyone else on
15
this subject matter?
16
A.
Yes.
17
Q.
Tell me with whom you have
18
text-messaged, if that's a phrase, or
19
instant-messaged.
20
A.
Neil Clark.
21
Q.
Anyone else?
22
A.
Not that I remember.
23
Q.
Have they been instant messages or text
24
messages?
Thomas Rankin
January 5, 2009
60 1
A.
Are they not the same?
2
Q.
I think the teenagers would tell us no,
3
they're not the same.
4
AOL vehicle where you can be sitting at a computer
5
and interacting in real time with someone on
6
another computer.
7
A.
Text.
8
Q.
Okay.
9
A.
Right.
10
Q.
All right.
11
you've text-messaged with Mr. Clark on this
12
subject matter?
13
A.
I don't recall.
14
Q.
Did you save any of the text messages?
15
A.
No.
16
Q.
You think you've deleted them?
17
A.
Yes.
18
Q.
I would ask you if any of those remain
19
on your telephone to not delete them.
20
consult with Mr. Weaver about that, but I would
21
ask that you not do that.
22
any e-mails dealing with that subject matter or
23
written documentation, whether it be
24
communications you received from others or notes
Instant message is the old
Text is over the telephone.
You recall how many times
You can
Similarly, if you have
Thomas Rankin
January 5, 2009
61 1
you made to yourself, please do not destroy,
2
delete, or anything like that.
3
Mr. Weaver can talk with you about that.
4
A.
Okay.
5
Q.
Thank you.
6
the Starbucks -- Easton Starbucks meeting Andrew
7
Minton and Lisa Rankin were in attendance with
8
you.
9
A.
A lobbyist at State Street Consultants.
10
Q.
Who is Lisa Rankin?
11
A.
My spouse.
12
Q.
How long have you and Lisa been
13
married?
14
A.
15
Eight years, almost.
16
Q.
17
front of her, by the way.
18
guy.
19
A.
I appreciate that.
20
Q.
Does Lisa Rankin also work for State
21
Street Consultants?
22
A.
No.
23
Q.
Has she ever?
24
A.
Yes.
And again,
You indicated to me that in
Who is Andrew Minton?
Better not wait too long on this one.
I would never ask you that question in I wouldn't do that to a
Thomas Rankin
January 5, 2009
62 1
Q.
During what time frame?
2
A.
2006 to 2008.
3
Q.
When did she cease working for State
4
Street Consultants?
5
A.
2008.
6
Q.
What part of the year?
7
A.
August, I think.
8
Q.
What was her job at State Street
9
Consultants?
10
A.
Lobbyist.
11
Q.
Is that the position she held there
12
throughout her tenure with State Street
13
Consultants?
14
A.
Yes.
15
Q.
You said that her employment there
16
commenced in 2006.
17
the year 2006?
18
A.
I don't recall.
19
Q.
Was your spouse a full-time employee of
20
State Street Consultants during the period that
21
she worked there?
22
A.
Yes.
23
Q.
Has your spouse ever been an employee
24
of State Street Partners?
Was that at the beginning of
Thomas Rankin
January 5, 2009
63 1
A.
Not that I'm aware of.
2
Q.
Has your spouse ever been an employee
3
of NSC Consulting Corp.?
4
A.
Yes.
5
Q.
During what time frame?
6
A.
1987 through 2006.
7
Q.
Is it the case, Mr. Rankin, that she
8
ceased to be an employee of NSC Consulting group
9
before she became an employee of State Street
10
Consultants?
11
A.
Yes.
12
Q.
Was it a situation in which it was at
13
the same point in time when she ceased to be
14
employed with NSC Consulting group but then became
15
employed by State Street Consultants?
16
A.
Yes.
17
Q.
To your knowledge, did Lisa Rankin at
18
any time after January 1st, 2006, provide services
19
to clients of NSC Consulting group?
20
A.
Yes.
21
Q.
Was that done on a regular basis?
22
A.
Yes.
23
Q.
To your knowledge, was it also the case
24
that other lobbyists, meaning other than Lisa
Thomas Rankin
January 5, 2009
64 1
Rankin, with State Street Consultants from January
2
1st, 2006 to the present, provided services to
3
clients of NSC Consulting Corp.?
4
A.
I don't know.
5
Q.
So you know that Lisa did, but you're
6
not sure if others did?
7
A.
Yes.
8
Q.
How do you know that Lisa did?
9
A.
She represented the nurses association.
10
Q.
And you know that to be a client of NSC
11
Consulting Corp.?
12
A.
Yes.
13
Q.
How do you know that?
14
MR. WEAVER:
I'm going to object to
15
your -- and raise spousal privilege with respect
16
to anything that Mr. Rankin's spouse has told him
17
without an non-necessary party present.
18
ask Dan if you'll pose his questions with respect
19
to his knowledge as the accountant for the
20
different entities.
21
MR. CVETANOVICH:
And I'll
Well, I'll go some of
22
that way, Mark.
23
questions in terms of knowledge from any source
24
other than Lisa.
What I'll do is pose the
Thomas Rankin
January 5, 2009
65 1
MR. WEAVER:
2
MR. CVETANOVICH:
3
MR. WEAVER:
4
MR. CVETANOVICH:
That's fine. Fair enough?
Yes.
Thank you. All right.
Sure.
5
Q.
6
Mr. Rankin.
7
A.
I'm easily confused.
8
Q.
Pardon me?
9
A.
I'm easily confused.
10
Q.
Well, I know Mr. Weaver can easily
11
straighten you out, too, so --
12
I hope all that didn't confuse you,
Before Mr. Weaver and I had our little
13
interchange, you indicated to me that you knew
14
that Lisa represented the nurses association.
15
question to you now is, do you know that from any
16
source other than Lisa telling you that?
17
A.
No.
18
Q.
Is that information reflected in the
19
books and records of State Street Consultants that
20
you see?
21
A.
22
talking about?
23
Q.
24
services to the nurses association.
My
What piece of information are you
That Lisa Rankin provides or provided
Thomas Rankin
January 5, 2009
66 1
A.
2
NSC.
3
Q.
4
Street Consultants?
5
A.
No.
6
Q.
Do you regularly see cash flow
7
statements of State Street Consultants?
8
A.
Yes.
9
Q.
Who prepares them?
10
A.
Ms. Harrison.
11
Q.
Do you play any role in the preparation
12
of the cash flow statements?
13
A.
No.
14
Q.
Does anyone other than Ms. Harrison, to
15
your knowledge, participate in the preparation of
16
the cash flow statements?
17
A.
18
that she incorporates into the cash flow.
19
Q.
20
Street Consultants' cash flow statements?
21
A.
Yes.
22
Q.
Why is NSC Consulting Corp. information
23
incorporated into State Street Consultants' cash
24
flow statements?
It is not in the books and records of
Is it in the books and records of State
I give Ms. Harrison NSC information
That she incorporates into the State
Thomas Rankin
January 5, 2009
67 1
A.
I don't know.
2
Q.
Who made a determination that it would
3
be done that way?
4
A.
I don't know.
5
Q.
To your knowledge, during the time that
6
you've had a relationship with State Street
7
Consultants, has it ever had an accountant on its
8
payroll?
9
A.
To my knowledge, no.
10
Q.
Ms. Harrison is a trained bookkeeper,
11
correct?
12
A.
13
training.
14
Q.
15
accounting or bookkeeping questions?
16
A.
No.
17
Q.
Do you know to whom Ms. Harrison turns
18
if she has accounting or bookkeeping questions in
19
connection with her performance of her job duties
20
for State Street Consultants?
21
A.
22 23 24
I don't know what she is, as far as
Does Ms. Harrison ever come to you with
I don't know. - - - - Thereupon, Plaintiffs' Exhibit 3 marked
for purposes of identification.
Thomas Rankin
January 5, 2009
68 1
- - - - -
2
Q.
3
document that is being marked Plaintiffs' Exhibit
4
3.
5
that, if you would, please.
Mr. Rankin, I now want to hand you a
I'll ask you to take a moment and look at
6
MR. WEAVER:
7
MR. CVETANOVICH:
8
MR. WEAVER:
9
Dan, is there is a 1?
Is that a previous
deposition?
10
MR. CVETANOVICH:
11
MR. WEAVER:
12
MR. CVETANOVICH:
13
MR. WEAVER:
Yeah, I'm just doing
No, that's all right.
MR. CVETANOVICH:
I
Be happy to get you a
copy.
18 19
Thank you.
just want to make sure I'm not missing any.
16 17
It was.
them all in sequence.
14 15
Yes.
MR. WEAVER: paper.
20
No, I've got plenty of
Thank you. MR. CVETANOVICH:
21
BY MR. CVETANOVICH:
22
Q.
23
Exhibit 3 --
24
A.
Yeah, don't we all.
Have you had a chance to take a look at
Yes.
Thomas Rankin
January 5, 2009
69 1
Q.
-- Mr. Rankin?
2
A.
Yes.
3
Q.
Before we get too deeply into that, let
4
me ask you, are you aware of one or more instances
5
when the Internal Revenue Service has issued a tax
6
assessment against Neil Clark individually?
7
A.
Yes.
8
Q.
Are you aware of the Internal Revenue
9
Service having issued a notice of a federal tax
10
lien against Mr. Clark individually?
11
A.
Yes.
12
Q.
I've handed you Exhibit 3, and you've
13
had a chance to take a look at it.
14
further with that, just let me note for the
15
record, so it is a matter of record, that this is
16
also a two-sided exhibit.
17
there's a certification on the back.
18
Before we go
So just note that
With that, can you identify for the
19
record, please, what Exhibit 3 is?
20
A.
21
Notice -MR. BEHAL:
Objection.
It speaks for
22
itself.
23
A.
Notice of federal tax lien.
24
Q.
Who is the taxpayer that is the subject
Go ahead and answer.
Thomas Rankin
January 5, 2009
70 1
of this notice?
2
A.
Neil S. Clark.
3
Q.
Had you seen this before today?
4
A.
Yes.
5
Q.
This reflects that the IRS is taking
6
the position that Mr. Clark has an unpaid balance
7
of a tax assessment against him for calendar year
8
or tax year 2006, $749,561.17.
9
A.
Yes.
10
Q.
Is Mr. Clark contesting that?
11
A.
No.
12
Q.
Has he yet paid any part of that unpaid
13
balance that's noted on the exhibit?
14
A.
I'm not aware of it.
15
Q.
Given your relationship with him, would
16
you expect that you would be aware of it if he had
17
made such payments?
18
A.
Yes.
19
Q.
This notice also indicates that
20
Mr. Clark had an unpaid balance on the assessment
21
for tax year 2007 in the amount of $321,454.38.
22
Correct?
23
A.
Yes.
24
Q.
Do you know if Mr. Clark has to date
Correct?
Thomas Rankin
January 5, 2009
71 1
paid any part of that unpaid balance?
2
A.
Not that I'm aware of.
3
Q.
I think we can set that one aside.
4 5
MR. WEAVER:
You need a bathroom break,
Tom?
6
THE WITNESS:
7
MR. CVETANOVICH:
8
THE VIDEOGRAPHER:
9
I'm sorry.
I gotta go.
Oh, sure. We are off the
record at 11:59.
10
(A brief recess is taken.)
11
THE VIDEOGRAPHER:
We are back on the
12
record at 12:13.
13
Q.
14
proceeding today I had asked you about what space
15
within the facility at 137 East State Street
16
Thomas A. Rankin & Associates occupied, and you
17
told me it was on the second floor.
18
to you now is:
19
A. Rankin & Associates occupied space on the first
20
floor of that building?
21
A.
Yes.
22
Q.
Can you tell me in what time frame your
23
firm occupied space on the first floor of that
24
building?
Mr. Rankin, at an earlier point in our
My question
Was there ever a time when Thomas
Thomas Rankin
January 5, 2009
72 1
A.
2004 through 2006.
2
Q.
Was that through the beginning of 2006,
3
or at some point later in the year in 2006?
4
A.
The beginning.
5
Q.
During the period when Thomas A. Rankin
6
& Associates occupied space on the first floor of
7
that building, did it pay rent?
8
A.
Yes.
9
Q.
Was its rent payments to State Street
10
Partners?
11
A.
Yes.
12
Q.
How did it come about that Thomas A.
13
Rankin & Associates moved from the first floor of
14
the building to the second floor of the building
15
and then stopped paying rent?
16
A.
17
space, the office that I was in -- let me rephrase
18
that.
19
Q.
Please.
20
A.
State Street Partners was attempting to
21
rent the first floor of the building to anyone
22
interested.
23
was a -- a dual office.
24
office was marketable and to someone who could use
The ability to rent the first floor
The office I had on the first floor They thought that that
Thomas Rankin
January 5, 2009
73 1
that space and possibly more offices, more office
2
space on the first floor.
3
upstairs to make that office or that additional
4
space available.
5
Q.
6
then able to occupy space in the building, albeit
7
on the second floor, at no rent?
8
A.
I don't know.
9
Q.
Who communicated to you that you would
So I guess -- I moved
And how did it come about that you were
10
no longer have to pay rent to occupy space in the
11
building?
12
A.
Neil Clark.
13
Q.
What did he say to you?
14
A.
"Move upstairs, it's more convenient
15
for you to be upstairs."
16
Q.
17
it?
18
A.
I would assume.
19
Q.
Did he say why?
20
A.
No.
21
Q.
Did he ask you if that would be okay
22
with you?
23
A.
Yes.
24
Q.
It was okay with you, wasn't it?
That's about it.
He added there would be no rent, I take
Thomas Rankin
January 5, 2009
74 1
A.
It was okay.
2
Q.
How much had Thomas A. Rankin &
3
Associates been paying in rent up to that point in
4
time when it moved up to the second floor?
5
A.
Maybe 1500 a month.
6
Q.
Since Thomas A. Rankin & Associates
7
moved its offices to the second floor of 137 East
8
State Street, have you personally had a key to the
9
office building?
10
A.
Yes.
11
Q.
Have you had a key or a pass card or
12
something that would give you the ability to gain
13
access to the second floor of that building?
14
A.
Yes.
15
Q.
What did it take or does it take to
16
gain access to the second floor of the building?
17
A.
To gain access to the second floor?
18
Q.
Yes, sir.
19
A.
During business hours, walk up the
20
steps.
21
Q.
22
what security there is for the offices of State
23
Street Consultants.
24
locked doors, and it requires a key or it requires
I'm not sure I understand your question. Well, I'm just trying to understand
You know, many offices have
Thomas Rankin
January 5, 2009
75 1
a pass card or it requires knowing a code that one
2
has to punch in little buttons to get in.
3
just trying to understand what was the arrangement
4
there with the offices of State Street
5
Consultants.
6
A.
7
pass code to the back door.
8
Q.
9
up to the offices of State Street Consultants?
And I'm
All occupants of the building had a
Could all occupants of the building get
10
A.
No.
11
Q.
What else was required for access to
12
the second floor?
13
A.
During business hours, nothing.
14
Q.
How about outside of business hours?
15
A.
A security code for the second floor
16
alarm.
17
Q.
18
say:
19
access to the second floor during the past three
20
years?
21
A.
Yes.
22
Q.
Are there old-fashioned keys required
23
to gain access to any part of the building over
24
there?
Was -- let me take that word back and Were you provided the security code to gain
Thomas Rankin
January 5, 2009
76 1
A.
Yes.
2
Q.
For what parts of the building does one
3
need a key to gain access?
4
A.
5
have keys.
6
Q.
Any other parts of the building?
7
A.
No.
8
Q.
Did you have a key to the basement?
9
A.
No.
10
Q.
Did you have a key to any of the
11
interior doors throughout the office complex?
12
A.
Did I or do I?
13
Q.
Well, let's start with do you.
14
A.
Yes.
15
Q.
Since you moved out of the building
16
here in the past couple of weeks, whenever it's
17
been, you haven't yet turned in your keys?
18
A.
19
building.
20
Q.
21
that yet; is that correct?
22
A.
Yes.
23
Q.
Is there a point in time when you need
24
to get it out of there?
To go to the basement.
Interior doors
I have additional furniture inside the
So you haven't had a chance to move
Thomas Rankin
January 5, 2009
77 1
A.
Yes.
2
Q.
What is that point in time?
3
A.
When it's convenient for State Street
4
Partners to get me access where I can send people
5
to --
6
I'd like to.
MR. WEAVER:
I was going to discuss
7
that with you today, Dan.
8
A.
9
-- move the furniture. MR. CVETANOVICH:
Why don't we do that
10
in a little bit.
11
Q.
12
You've still got a key so that when the time is
13
right you can gain access to the offices to get
14
your furniture; is that correct?
15
A.
Yes.
16
Q.
When you vacated the building, apart
17
from getting the furniture out that's still there,
18
did anyone ask you to return the key that you have
19
to the building?
20
A.
No.
21
Q.
What part of the building are you
22
permitted access through use of this key?
23
A.
The key to my door?
24
Q.
Well, that may be the answer to the
So you've got some furniture there.
Thomas Rankin
January 5, 2009
78 1
question.
2
A.
Okay.
3
Q.
You said that keys were required to get
4
to the basement and for some interior door.
5
A.
Yes.
6
Q.
Doors, plural.
7
a key.
8
you have opens.
9
A.
To my interior door.
10
Q.
Do you know whether since Thomas A.
11
Rankin & Associates moved its operation out of 137
12
East State Street the codes have been changed to
13
permit you to gain access to the building and to
14
the second floor of the building?
15
A.
Am I aware of that?
16
Q.
Yes, sir.
17
A.
I am not aware of that.
18
Q.
Do you know whether the codes have been
19
changed for one to gain access to the building and
20
then to the second floor of the building since
21
State Street Consultants moved its operations out
22
of the building?
23
A.
I'm not aware of it.
24
Q.
Do you know if State Street
You've said you've got
I'm just trying to understand what the key
Thomas Rankin
January 5, 2009
79 1
Consultants' move of its operations from that
2
building is yet complete?
3
A.
I don't know.
4
Q.
Do you know that the move has at least
5
started?
6
A.
Yes.
7
Q.
Do you know if any State Street
8
Consultants personnel are yet occupying space at
9
49 South Grant Street?
10
A.
I don't know.
11
Q.
Do you know whether there is a timeline
12
in place for that move to be completed?
13
A.
I don't.
14
Q.
Do you know if there are any employees
15
of State Street Consultants who will be performing
16
their duties of employment from locations other
17
than 49 South Grant Street?
18
A.
I don't know where they will work from.
19
Q.
Have you heard anyone discuss where the
20
various employees of State Street Consultants will
21
be working from?
22
A.
I've heard.
23
Q.
Tell me what you've heard.
24
A.
Home or 49 South Grant street or the
Thomas Rankin
January 5, 2009
80 1
Statehouse.
2
Q.
3
Street Consultants have you heard will be
4
performing their services from 49 South Grant
5
Street?
6
A.
I don't know.
7
Q.
Do you know any of them?
8
A.
I don't know where they will be working
9
from.
I think that's it. All right.
Which employees of State
10
Q.
11
working from 49 South Grant Street?
12
A.
Yes.
13
Q.
Which ones?
14
A.
I don't know specifically all -- which
15
ones.
16
Q.
Haven't heard any names?
17
A.
No.
18
Q.
Which employees of State Street
19
Consultants have you heard will be performing
20
services from their homes?
21
A.
22
Have you heard that any of them will be
Andrew Minton. MR. BEHAL:
Objection.
Go ahead.
23
Q.
You may respond.
24
A.
Andrew Minton, John Singleton, Penny
Thomas Rankin
January 5, 2009
81 1
Tipps, Aaron Ockerman.
2
Q.
Any others?
3
A.
Jane Harrison.
4
Q.
Any others?
5
A.
That's all I recall.
6
Q.
Andrew Minton is a lobbyist, correct?
7
A.
Yes.
8
Q.
Penny Tipps is also a lobbyist,
9
correct?
10
A.
Yes.
11
Q.
What is John Singleton's position at
12
State Street Consultants?
13
A.
Lobbyist.
14
Q.
What is Aaron Ockerman's position at
15
State Street Consultants?
16
A.
Lobbyist.
17
Q.
Do you know where Andrew Minton lives?
18
A.
No.
19
Q.
Do you know where John Singleton lives?
20
A.
No.
21
Q.
Do you know where Penny Tipps lives?
22
A.
Yes.
23
Q.
Where does Penny Tipps live?
24
A.
Westerville.
Thomas Rankin
January 5, 2009
82 1
Q.
Do you know where Aaron Ockerman lives?
2
A.
No.
3
Q.
Do you know for how long it is planned
4
that Mr. Minton, Mr. Singleton, Ms. Tipps, and
5
Mr. Ockerman will work from their homes?
6
MR. BEHAL:
7
whom?
8
Q.
9
bit.
10
Objection.
Planned by
Let me change the question a little
What we're talking about now -- what
11
I'm asking you about now is what you have heard.
12
Have you heard for how long Mr. Minton will be
13
performing his services for SSC from his home?
14
A.
I have not heard.
15
Q.
Have you heard for how long
16
Mr. Singleton will be working from his home?
17
A.
I have not heard.
18
Q.
Have you heard for how long Ms. Tipps
19
will be working from her home?
20
A.
I have not heard.
21
Q.
Have you heard for how long
22
Mr. Ockerman will be working from his home?
23
A.
I have not heard.
24
Q.
Do you know if there is in existence a
Thomas Rankin
January 5, 2009
83 1
plan for when these people will cease to work from
2
their homes?
3 4
MR. BEHAL: Q.
5 6
You may respond. MR. WEAVER:
I'm sorry.
What was the
basis?
7 8
Objection.
MR. BEHAL:
On the basis that I'm not
sure whose plan or what plan he's referring to.
9
MR. WEAVER:
So it's as to form?
10
MR. BEHAL:
11
MR. WEAVER:
12
want to make sure he understands.
13
It is. Can you rephrase?
MR. CVETANOVICH:
I just
Sure.
14
BY MR. CVETANOVICH:
15
Q.
16
you have any awareness of any plan formulated by
17
anyone for the duration for Mr. Minton,
18
Mr. Singleton, Ms. Tipps, and Mr. Ockerman to
19
continue working from their homes.
I'm just trying to understand whether
20
MR. BEHAL:
21
MR. WEAVER:
22
answer.
23
A.
24
work from their homes.
Objection. If you understand, you can
I don't know how long they're going to
Thomas Rankin
January 5, 2009
84 1
Q.
2
would be working from their homes?
3
A.
It was in the paper.
4
Q.
Did you learn it from any other source?
5
A.
I don't know where they would work
6
from.
7
Q.
8
any of these individuals working from their homes
9
is from the newspaper?
How did you learn that these people
So the only information you have about
10
A.
No.
11
Q.
What other sources of information do
12
you have for the proposition that these people
13
will be working from their homes?
14
A.
Discussion.
15
Q.
With whom?
16
A.
Andrew Minton.
17
Q.
Anyone else?
18
A.
No.
19
Q.
What did Mr. Minton tell you?
20
A.
I don't recall.
21
Q.
Is he the one who told you that he,
22
Mr. Singleton, Ms. Tipps and Mr. Ockerman would be
23
working from their homes, at least for a time?
24
A.
I don't recall who exactly told me
Thomas Rankin
January 5, 2009
85 1
that.
2
Q.
3
you that?
4
A.
Possibly.
5
Q.
You just don't know?
6
A.
Possibly.
7
Q.
Can you tell me anyone else who
8
communicated that information to you or part of
9
that information to you?
Did anyone other than Mr. Minton tell
10
A.
Neil Clark.
11
Q.
Anyone else?
12
A.
No.
13
Q.
What did Mr. Clark tell you about that?
14
A.
I don't specifically remember.
15
Q.
When did you speak with Mr. Clark about
16
that?
17
A.
I don't know.
18
Q.
Where were you when you and Mr. Clark
19
spoke about that?
20
A.
I don't know.
21
Q.
Did you and he speak in person?
22
A.
I don't know if it was in person.
23
Q.
Did Mr. Clark communicate to you that
24
this would be a temporary arrangement, meaning the
Thomas Rankin
January 5, 2009
86 1
arrangement whereby some of these people would be
2
working from their homes?
3
A.
Can you re-ask that, please.
4
Q.
Yes.
5
did he communicate to you that the arrangement
6
whereby Andrew Minton, John Singleton, Penny Tipps
7
and Aaron Ockerman would work from their homes was
8
to be a temporary arrangement?
9
A.
No.
10
Q.
When you spoke with Mr. Minton about
11
this arrangement that has these people working
12
from their homes, did he give you any indication
13
of how long that arrangement would last?
14
A.
No.
15
Q.
Does State Street Consultants have
16
lobbyists other than Mr. Minton, Mr. Singleton,
17
Mr. Tipps and --
18
When you spoke with Mr. Clark,
MR. BEHAL:
Ms. Tipps. Ms. Tipps and Mr. Ockerman?
19
Q.
Excuse me.
20
A.
Neil Clark.
21
Q.
Any others?
22
A.
No.
23
Q.
Is Mr. Clark going to be working from
24
his home, to your knowledge?
Thomas Rankin
January 5, 2009
87 1
A.
I don't know.
2
Q.
Have you heard it stated that he will
3
be working from 49 South Grant Street?
4
A.
Yes.
5
Q.
By whom?
6
A.
Mr. Clark.
7
Q.
Was that in the same conversation when
8
he told you others would be working from their
9
homes?
10
A.
11
conversation.
12
Q.
13
State Street Consultants employees who would be
14
working from 49 South State Street?
15 16
I don't recall the specific
Did he tell you the names of any other
MR. WEAVER:
Pardon me.
Do you mean
Grant Street?
17
MR. CVETANOVICH:
I do.
Thank you.
18
Let me restate the question.
19
my head here.
20
Q.
21
tell you the name of any other State Street
22
Consultants employees who will be working from 49
23
South Grant Street?
24
A.
Too many streets in
Did Mr. Clark, when you spoke with him,
They all have the ability to work from
Thomas Rankin
January 5, 2009
88 1
49 -- whatever that street is.
2
MR. BEHAL:
Grant.
3
A.
Grant Street.
4
Q.
You learned that from Mr. Clark?
5
A.
Yes.
6
Q.
Do you know what will be the nature of
7
the space that State Street Consultants will
8
occupy at 49 South Grant?
9
A.
A building.
10
Q.
Let me ask a little better question.
11
And I appreciate that, but let me ask a little
12
better question.
13
Do you know for what uses the space
14
that State Street Consultants will occupy in that
15
building will be set up?
16
A.
I still don't understand.
17
Q.
In other words, is it all going to be
18
conference space, meeting rooms, private offices,
19
a roller rink --
20
A.
Office space.
21
Q.
Private offices, is that your
22
understanding?
23
A.
24
private offices.
I'm sorry.
There are -- from what I understand,
Thomas Rankin
January 5, 2009
89 1
Q.
Also meeting space?
2
A.
From what I understand.
3
Q.
To your knowledge, will there be enough
4
private offices to house all the lobbyists?
5
A.
I don't know.
6
Q.
Do you know how many private offices
7
will be set up in the office space that State
8
Street Consultants occupies at 41 South Grant?
9
Excuse me.
49 South Grant.
10
A.
I don't.
11
Q.
You said to me probably 15 minutes ago,
12
Mr. Rankin, that some of State Street Consultants'
13
employees would be working from 49 South Grant,
14
some would be working from their homes, some would
15
be working from the Statehouse.
16
Street Consultants' employees do you understand
17
will be working from the Statehouse?
18
A.
19
services at the Statehouse.
20
Q.
21
Street Consultants who under this new arrangement
22
will be performing work duties only at the
23
Statehouse?
24
A.
Which of State
I presume they all will perform
Do you know of any employee of State
No.
Thomas Rankin
January 5, 2009
90 1
Q.
2
Consultants who you have been made to understand
3
will be working out of his or her home whose name
4
you have not already provided me?
5
A.
I don't know.
6
Q.
We spoke quite a bit earlier in our
7
proceeding today about the nature of the services
8
that your firm provides for State Street
9
Consultants.
Is there any employee of State Street
I want to ask a similar question
10
about the services that your firm provides for
11
other entities, and we'll just take the other
12
entities one by one.
13
Let's first talk about State Street
14
Partners.
15
services that Thomas A. Rankin & Associates
16
provides for State Street Partners.
17
A.
Tax compliance and bookkeeping.
18
Q.
Anything else?
19
A.
No.
20
Q.
I want to make sure --
21
A.
I'm going to --
22
Q.
Go ahead.
23
A.
I have talked with the bank, with the
24
lending institution, with reference to the
Can you describe for me, please, the
Thomas Rankin
January 5, 2009
91 1
mortgage on the building.
2
Q.
Anything else?
3
A.
No.
4
Q.
When you used the phrase "tax
5
compliance" in reference to services that your
6
company provides to State Street Partners, what
7
specifically do you mean?
8
A.
9
tax return.
Preparation of the annual partnership
10
Q.
Anything else?
11
A.
No.
12
Q.
Do you play a role in the actual
13
remittance of taxes?
14
A.
No.
15
Q.
So you're talking about return
16
preparation?
17
A.
Yes.
18
Q.
As part of that, do you also prepare
19
the K1s?
20
A.
Yes.
21
Q.
Is there anything else that your
22
company does for State Street Partners that's
23
included within this phrase you used, "tax
24
compliance"?
Thomas Rankin
January 5, 2009
92 1
A.
Not that I can think of.
2
Q.
You also told me that your company does
3
bookkeeping or provides bookkeeping services to
4
State Street Partners.
5
company do in the way of bookkeeping for State
6
Street Partners?
7
A.
8
from Ms. Harrison and puts it into QuickBooks, a
9
QuickBooks format.
What precisely does your
My company receives a check register
10
Q.
11
financial statements for State Street Partners?
12
A.
No.
13
Q.
Once the information from the check
14
register is put into a QuickBooks format, are
15
there various kinds of reports that you or an
16
operator can print from QuickBooks based on the
17
data input from the check register?
18
A.
Yes.
19
Q.
For example, can you print a profit and
20
loss statement for State Street Partners using
21
QuickBooks?
22
A.
Yes.
23
Q.
Can you print a balance sheet using
24
QuickBooks?
Does your company also prepare any
Thomas Rankin
January 5, 2009
93 1
A.
Yes.
2
Q.
Can you print a general ledger using
3
QuickBooks?
4
A.
Yes.
5
Q.
Did you personally play any role in
6
helping to assemble documents that the Defendants
7
in this lawsuit in which your deposition is being
8
taken would produce to the Plaintiffs?
9
A.
Yes.
10
Q.
Did you play a role in generation of or
11
printing of the balance sheet, the general ledger,
12
and the profit and loss statement for State Street
13
Partners?
14
A.
15
me, yes.
16
Q.
Information provided to you by whom?
17
A.
The check register, by Ms. Harrison.
18
Q.
Did you also play the same role in
19
connection with generation of or printing of the
20
balance sheet, the general ledger, and the profit
21
and loss statements that have been produced for
22
State Street Consultants?
23
A.
24
yes.
Based on the information provided to
Based on information provided to me,
Thomas Rankin
January 5, 2009
94 1
Q.
2
Corp.?
3
A.
No.
4
Q.
Did you have any role or play any role
5
whatsoever in -- I'm sorry.
6
A.
7
asking the same question that you asked two
8
previous times?
9
Q.
For a different entity, yes.
10
A.
Same exact question?
11
Q.
Well, let me just ask the question.
12
think it's going to be easier at this point.
13
A.
I appreciate it.
14
Q.
The entity that I'm going to reference
15
is NSC Consulting Corp., and the question is:
16
you personally generate or print the balance
17
sheets, the general ledgers, and the profit and
18
loss statements that NSC Consulting Corp. has
19
produced in connection with this litigation?
20
A.
Based on information provided, yes.
21
Q.
Was there anything that you personally
22
had to do to gain access to the QuickBooks data of
23
these entities in order to be able to generate
24
those documents?
Is the same true for NSC Consulting
I thought it was the same -- are you
I
Did
Thomas Rankin
January 5, 2009
95 1
A.
Repeat that again.
2
Q.
Certainly.
3
personally had to do to gain access to the
4
QuickBooks data of these entities in order to be
5
able to generate those documents?
6
A.
Turn on my computer.
7
Q.
Anything else?
8
A.
No.
9
Q.
Were you able to access that data from
Was there anything that you
Yes.
10
your personal computer?
11
A.
Yes.
12
Q.
Where was it located at the time that
13
you accessed the data for purposes of generating
14
and printing these reports?
15
A.
996 Poppy Hills Drive.
16
Q.
So you were able to do that from your
17
home?
18
A.
Yes.
19
Q.
Prior to the time when you received the
20
request to go into QuickBooks and generate these
21
reports, Mr. Rankin, did you already have the
22
ability to go into the QuickBooks database of
23
these three entities via your own computer?
24
A.
It is on my computer.
QuickBooks.
Thomas Rankin
January 5, 2009
96 1
Q.
2
Right?
3
A.
Yes.
4
Q.
You have that on your personal
5
computer?
6
A.
Yes.
7
Q.
Is that an application that you use
8
generally in connection with your accounting
9
practice?
Okay.
QuickBooks is an application.
Yes?
10
A.
Yes.
11
Q.
Is that an application that you use for
12
clients of your firm other than State Street
13
Consultants, State Street Partners, NSC Consulting
14
Corp., and Neil S. Clark?
15
A.
Yes.
16
Q.
The data that one can access and
17
manipulate through use of QuickBooks for State
18
Street Consultants, State Street Partners, NSC
19
Consulting group, and Neil S. Clark resides where?
20
A.
In my computer.
21
Q.
Is your computer part of a computer
22
network that also includes computers of State
23
Street Consultants?
24
A.
Yes.
Thomas Rankin
January 5, 2009
97 1
Q.
For how long has that been the case?
2
A.
Since 2004.
3
Q.
Who else at State Street Consultants
4
works with QuickBooks?
5
A.
No one that I'm aware of.
6
Q.
Does Janie Harrison work with
7
QuickBooks?
8
A.
9 10 11 12
No. MR. WEAVER:
Bathroom break.
THE VIDEOGRAPHER:
We are off the
record at 12:48. - - - - -
13
Thereupon, a luncheon recess is taken
14
at 12:48 p.m.
15 16 17 18 19 20 21 22 23 24
- - - - -
Thomas Rankin
January 5, 2009
98 1
Monday Afternoon Session
2
January 5, 2009, 1:30 p.m.
3
- - - - -
4
THE VIDEOGRAPHER:
5
record at 1334.
6
1334.
7
We are back on the
We are back off the record at
We are back on the record at 1336.
8
BY MR. CVETANOVICH:
9
Q.
Mr. Rankin, welcome back from lunch.
10
All ready to resume?
11
A.
Yes.
12
Q.
Okay.
13
Let's do that.
At an earlier point in our proceeding
14
today when you were describing to me the services
15
that you provide to State Street Partners, I
16
understood you to say that at least upon occasion
17
you interact on its behalf with its banks.
18
understand that correctly?
19
A.
I have.
20
Q.
And I think you specifically alluded to
21
the mortgage.
22
A.
Yes.
23
Q.
The title to 137 East State Street is
24
in the name of State Street Partners, correct?
Did I
Did I understand that correctly?
Thomas Rankin
January 5, 2009
99 1
A.
As far as I know.
2
Q.
And there is a mortgage on the
3
building, correct?
4
A.
Yes.
5
Q.
Do you know who is the holder of the
6
mortgage interest in the building?
7
A.
Fifth Third Bank.
8
Q.
Do you play any role in connection with
9
State Street Partners' mortgage payments to Fifth
10
Third Bank?
11
A.
No role.
12
Q.
Have there been instances, to your
13
knowledge, when State Street Partners missed a
14
mortgage payment in whole or in part?
15
A.
Yes.
16
Q.
How many times has that happened, to
17
your recollection?
18
A.
Several.
19
Q.
When that has happened, has that
20
occasioned a need for someone on behalf of State
21
Street Partners to communicate with the bank?
22
A.
Yes.
23
Q.
Have you been that someone?
24
A.
Under authority, I have.
Thomas Rankin
January 5, 2009
100 1
Q.
2
communicated in those instances where State Street
3
Partners missed a mortgage payment?
4
A.
Eric Reidinger.
5
Q.
Anyone else?
6
A.
Can't remember the other fellow's name.
7
Q.
There is another fellow from Fifth
8
Third Bank?
9
A.
With whom at Fifth Third Bank have you
Before Eric Reidinger, Rob Hasslinger I
10
think was his name.
11
Q.
Those are tough names.
12
A.
Some things I remember well.
13
Q.
You've dealt with both of those
14
gentlemen?
15
A.
16
Reidinger.
17
Q.
18
officer?
19
A.
Yes.
20
Q.
And now you're dealing with Eric
21
Reidinger?
22
A.
I'm not dealing with any of it now.
23
Q.
Why are you not dealing with any of it
24
now?
More with Rob Hasslinger than with Eric
And Rob Hasslinger is the former loan
Thomas Rankin
January 5, 2009
101 1
A.
2
attorneys are dealing with it.
3
Q.
4
State Street Partners?
5
A.
I would presume.
6
Q.
Who is that?
7
A.
I don't know for sure.
8
Q.
When you said "the attorneys," what
9
attorneys did you mean?
I'm under the understanding that the
The attorneys being legal counsel for
10
A.
11
Fifth Third, and I know that Jamie Ryan has talked
12
with Fifth Third.
13
Q.
14
time that you and your firm have provided services
15
to State Street Partners when it has renegotiated
16
the terms of its mortgage with Fifth Third Bank?
17
A.
I'm sorry.
18
Q.
Yes.
19
occasion during the time that you and your firm
20
have provided services to State Street Partners
21
when State Street Partners has renegotiated the
22
terms of its mortgage with Fifth Third Bank?
23
A.
24
with services during that time.
I know that Bob Behal has talked with
Have there been occasions during the
Can you ask that again?
Have there been occasions or any
I have provided State Street Partners
Thomas Rankin
January 5, 2009
102 1
Q.
2
terms of the mortgage?
3
A.
As far as I understand, yes.
4
Q.
Have you been involved in the process?
5
A.
A portion of the process.
6
Q.
What portion of the process have you
7
been involved in?
8
A.
The initial portion.
9
Q.
Tell me what the initial portion in
Have there been renegotiations of the
10
which you were involved was.
11
A.
12
mortgage.
13
Q.
14
out?
15
A.
January of 2003.
16
Q.
When was it refinanced?
17
A.
I don't know specifically.
18
Q.
What's your best recollection?
19
A.
Can you define "refinance" for me?
20
Q.
Well, you used the term in an answer
21
just a couple of moments ago, so I mean it in the
22
same sense that you meant it.
23
A.
24
original note has not been refinanced.
The refinancing of the original
When was the original mortgage taken
I'm not -- as far as I'm aware, the
Thomas Rankin
January 5, 2009
103 1
Q.
2
change in the terms of State Street Partners'
3
borrowing relationship with Fifth Third Bank?
4
A.
5
extended.
6
Q.
7
time when the mortgage had to be paid off has been
8
stretched out?
9
A.
Yes.
10
Q.
Have any other aspects of the mortgage
11
been changed?
12
A.
To my knowledge, yes.
13
Q.
What other terms of the mortgage
14
relationship have been changed?
15
A.
16
payments have been deferred.
17
Partners is paying interest only.
18
Q.
19
the loan?
20
A.
No.
21
Q.
There came a point in time when that
22
change was made by the parties to the mortgage
23
arrangement?
24
A.
To your knowledge, has there been any
The terms of the mortgage have been
All right.
Meaning that the point in
It's my understanding the principal And State Street
Was that the case in the inception of
Yes.
Thomas Rankin
January 5, 2009
104 1
Q.
Do you recall when that was?
2
A.
June 2008.
3
Q.
Do you recall why that was?
4
A.
Dispute amongst owners.
5
Q.
When you say a dispute amongst owners,
6
isn't State Street Partners the only owner of that
7
building?
8
A.
9
Partners.
Dispute of investors in State Street
10
Q.
So you mean Mr. Clark and Mr. Tipps?
11
A.
Yes.
12
Q.
They're the only two partners in State
13
Street Partners, correct?
14
A.
Yes.
15
Q.
What did any dispute between them have
16
to do with the need of State Street Partners to
17
seek to renegotiate the terms of the mortgage?
18
A.
I'm sorry.
Can you please repeat?
19
Q.
Certainly.
What did any dispute
20
between them have to do with the need of State
21
Street Partners to seek to renegotiate the terms
22
of the mortgage?
23
A.
24
know specifically.
I would guess -- I'd have to -- I don't
Thomas Rankin
January 5, 2009
105 1
Q.
2
State Street Partners sought to renegotiate the
3
terms of the mortgage was because of a dispute
4
amongst the owners.
5
the owners you meant Mr. Clark and Mr. Tipps.
6
A.
Uh-huh.
7
Q.
And now I'm trying to understand what
8
that dispute, as you've characterized it, between
9
Mr. Clark and Mr. Tipps had to do with creating a
You had told me that the reason that
And then you told me that by
10
need for State Street Partners to seek to
11
renegotiate the mortgage.
12
A.
13
anyway.
14
relating to a lease of the space between State
15
Street Consultants and State Street Partners.
16
Q.
17
renegotiated anyway?
18
A.
19
note due February of 2008 or January of 2008.
20
Q.
21
Street Partners not have the resources to pay off
22
the note?
23
A.
No.
24
Q.
So it needed to renegotiate the
The mortgage needed to be renegotiated And the dispute, as far as I'm aware, was
Why did the mortgage need to be
From what I recall, it was a five-year
As that date approached, did State
As far as I'm aware.
Thomas Rankin
January 5, 2009
106 1
mortgage or somehow come up with the money to pay
2
off the note?
3
A.
4
the note.
5
Q.
6
of trying to accomplish that, correct?
7
A.
Yes.
8
Q.
And you played a role in that process,
9
did you not?
Renegotiate, refinance, yes, or pay off
And, in fact, it then set upon a course
10
A.
Early on.
11
Q.
Tell us what role you played in the
12
process.
13
A.
14
new loan for State Street Partners.
15
Q.
16
in getting the new terms?
17
A.
Rob Hasslinger.
18
Q.
Anyone else?
19
A.
No.
20
Q.
What was required of you to get the
21
terms of what would become a new mortgage note?
22
A.
Phone call.
23
Q.
A single phone call?
24
A.
No.
Getting the terms from the bank of a
With whom did you interact at the bank
More than one.
Thomas Rankin
January 5, 2009
107 1
Q.
2
the mortgage loan agent?
3
A.
Correct.
4
Q.
Did you have to meet with him?
5
A.
No.
6
Q.
Did you meet with anyone from Fifth
7
Third Bank as part of that process?
8
A.
The early process, no.
9
Q.
By your reference to the early process,
So multiple telephone discussions with
10
I'm led to ask:
11
process when you had to meet with someone from
12
Fifth Third Bank?
13
A.
14
Third Bank.
15
Q.
16
someone from Fifth Third Bank?
17
A.
Once, possibly twice.
18
Q.
With whom did you meet?
19
A.
Eric Reidinger.
20
Third representatives that I don't recall their
21
names.
22
Q.
Where was the meeting?
23
A.
Fifth Third Bank.
24
Q.
What was the purpose of the meeting?
Was there a point later in the
I did meet with someone from Fifth I'm not sure I had to. How many times did you meet with
And two other Fifth
Thomas Rankin
January 5, 2009
108 1
A.
To discuss the status of the mortgage.
2
Q.
Of the mortgage before the terms were
3
changed?
4
A.
Yes.
5
Q.
Where was the meeting held?
6
A.
Fifth Third Bank.
7
Q.
Did anyone accompany you to the meeting
8
on behalf of State Street Partners?
9
A.
Neil Clark was at the meeting.
10
Q.
Was anyone else from State Street
11
Partners at the meeting?
12
A.
No.
13
Q.
Did Mr. Clark accompany you to the
14
meeting?
15
A.
Accompany -- walk together?
16
Q.
Yes.
17
A.
Yes.
18
Q.
Did you walk over and back together?
19
A.
I don't recall.
20
Q.
As part of that process of
21
renegotiation of the terms of the mortgage, was
22
there a requirement that an application be
23
submitted on behalf of State Street Partners?
24
A.
I don't recall if there was an
Thomas Rankin
January 5, 2009
109 1
application that was resubmitted.
2
Q.
3
financial documents be submitted to Fifth Third
4
Bank?
5
A.
I would presume, yes.
6
Q.
Do you recall what manner of financial
7
documents were submitted to Fifth Third Bank as
8
part of that process?
9
A.
I don't recall exactly.
10
Q.
Did you take care of that?
11
A.
I don't recall if I would have taken
12
care of that.
13
Q.
14
mortgage relationship between State Street
15
Partners and Fifth Third Bank, either before or
16
after the renegotiation of terms, has State Street
17
Partners been required to make periodic
18
submissions of financial information to the bank?
19
A.
Yes.
20
Q.
How frequently is State Street Partners
21
required to make submissions of financial
22
information to the bank?
23
A.
Annually.
24
Q.
Is that under the terms of the mortgage
Was there a requirement that any
As a term of the mortgage, or the
Thomas Rankin
January 5, 2009
110 1
as renegotiated, or was that under the original
2
mortgage terms?
3
A.
4
or if --
5
Q.
6
Partners has had to do throughout the mortgage
7
lending relationship with Fifth Third Bank?
8
A.
Probably.
9
Q.
Do you have a recollection?
10
A.
Yes.
11
Q.
So it's been there throughout the
12
relationship?
13
A.
Yes.
14
Q.
What financial information does State
15
Street Partners periodically submit to Fifth Third
16
Bank?
17
A.
18
statement.
19
Q.
Anything else?
20
A.
That State Street Partners submits to
21
the bank?
22
Q.
Yes, sir.
23
A.
I don't recall.
24
Q.
Does State Street Partners regularly
I don't know where it is in the terms,
Is that something that State Street
Balance sheet, profit and loss
Thomas Rankin
January 5, 2009
111 1
submit cash flow statements to the bank?
2
A.
Not that I'm aware of.
3
Q.
Does State Street Partners regularly
4
submit to the bank statements of sources and uses
5
of moneys or revenues?
6
A.
Not that I'm aware of.
7
Q.
Have you ever seen a statement of
8
sources and uses of revenues for State Street
9
Partners?
10
A.
Yes.
11
Q.
Do you prepare those?
12
A.
No.
13
Q.
Who prepares those?
14
A.
Ms. Harrison.
15
Q.
Is that done in QuickBooks?
16
A.
No.
17
Q.
Is it done under your supervision?
18
A.
No.
19
Q.
Do you know whether pursuant to the
20
terms of the mortgage that State Street Partners
21
has with Fifth Third Bank, State Street Partners
22
is required to submit financial information of
23
State Street Consultants?
24
A.
Yes.
Thomas Rankin
January 5, 2009
112 1
Q.
2
required to submit to Fifth Third Bank financial
3
information of State Street Consultants?
4
A.
I don't know the exact requirement.
5
Q.
Just as best you can recollect, how
6
frequently is a submission made to the bank?
7
A.
Annually.
8
Q.
Were any submissions of financial
9
information of State Street Consultants made to
How often is State Street Partners
10
Fifth Third by State Street Partners in connection
11
with renegotiation of the terms of the mortgage?
12
A.
I don't recall.
13
Q.
When financial information of State
14
Street Consultants is submitted to Fifth Third
15
Bank by State Street Partners, what is submitted?
16
A.
A balance sheet, and a P&L.
17
Q.
Anything else?
18
A.
Possibly a cash flow.
19
Q.
That would be the cash flow statements
20
prepared by Ms. Harrison?
21
A.
Yes.
22
Q.
Before financial information is
23
submitted to Fifth Third Bank, do you personally
24
review it for accuracy?
Thomas Rankin
January 5, 2009
113 1
A.
QuickBooks information I do review.
2
Q.
What about the cash flow statements?
3
A.
No.
4
Q.
Does anyone review those for accuracy
5
before they're submitted to Fifth Third Bank?
6
A.
I don't know.
7
Q.
Does State Street Consultants have a
8
lending relationship with any banks or a borrowing
9
relationship with any banks?
10
A.
Yes.
11
Q.
What banks?
12
A.
I'm aware of Huntington Bank and Fifth
13
Third Bank.
14
Q.
15
Consultants' borrowing from Fifth Third Bank?
16
A.
17
outstanding.
18
Q.
19
note?
20
A.
I don't recall.
21
Q.
What is its maturity date?
22
A.
I don't recall that.
23
Q.
What was the borrowing for?
24
A.
The borrowing was to term out debt,
What is the nature of State Street
Term note.
They have a term note
What is the principal amount of the
Thomas Rankin
January 5, 2009
114 1
outstanding debt.
2
Q.
3
outstanding debt?
4
A.
I don't particularly know specifically.
5
Q.
Excuse me.
6
credit?
7
A.
Yes.
8
Q.
It also include credit card debt?
9
A.
Not to my knowledge.
10
Q.
Do you recall what the limit was on the
11
line of credit?
12
A.
200,000.
13
Q.
At the time that the borrowing was
14
termed out, as you've put it, had State Street
15
Consultants been running at or near the limit on
16
the line of credit?
17
A.
Yes.
18
Q.
And so a decision was made to term that
19
out?
20
A.
Yes.
21
Q.
Do you recall what the principal amount
22
was at the time that that borrowing was termed
23
out?
24
A.
What activities have given rise to the
Was it draws upon a line of
It's my recollection.
I'm sorry.
Can you ask that again?
Thomas Rankin
January 5, 2009
115 1
Q.
Yes, sir.
2
Do you recall what the principal amount
3
was at the time that the borrowing was termed out?
4
A.
195,000, maybe.
5
Q.
Do you recall what the term was for
6
repayment of the principal amount?
7
A.
I don't.
8
Q.
Do you recall what the interest rate
9
was?
10
A.
I don't.
11
Q.
Was the interest rate achieved through
12
terming out the borrowing on the line of credit
13
less than the interest rate that was payable on
14
the line of credit?
15
A.
I don't know.
16
Q.
Does State Street Consultants have any
17
other borrower relationships with Fifth Third
18
Bank?
19
A.
Not that I'm aware of.
20
Q.
What is the nature of State Street
21
Consultants' borrowing relationship with
22
Huntington Bank?
23
A.
Line of credit.
24
Q.
Do you know the limit on that line of
Thomas Rankin
January 5, 2009
116 1
credit?
2
A.
100,000.
3
Q.
Do you know if there is any security
4
for that line of credit from Huntington Bank?
5
A.
I don't know.
6
Q.
Do you know if there are any guarantors
7
of State Street Consultants' repayment obligation
8
on the Huntington Bank line of credit?
9
A.
Yes.
10
Q.
Who are the guarantors?
11
A.
Mr. Clark and Mr. Tipps.
12
Q.
Any others?
13
A.
Not that I'm aware of.
14
Q.
Do you know if State Street Consultants
15
has given any other security for its repayment
16
obligation on the line of credit to Huntington
17
Bank?
18
A.
I don't know.
19
Q.
Do you know if State Street Consultants
20
has given any security for its repayment
21
obligation on the term loan from Fifth Third Bank?
22
A.
I don't know.
23
Q.
Do you know if State Street Partners
24
has given Fifth Third Bank any security apart from
I don't remember.
Thomas Rankin
January 5, 2009
117 1
the mortgage interest itself in the realty for its
2
repayment obligation on the mortgage loan?
3
A.
Can you say that again?
4
Q.
Yes, sir.
5
(Conference room phone rings.)
6
MR. CVETANOVICH:
7
Gonzalez.
8 9
Do you want to go
off the record? MR. CVETANOVICH: just a minute.
12 13
Let's hold on just a minute. THE VIDEOGRAPHER:
10 11
This could be John
I think we should for
It will take him a few minutes --
THE VIDEOGRAPHER:
We are off the
record at 1404.
14
(A brief recess is taken.)
15
THE VIDEOGRAPHER:
We are back on the
16
record at 1408.
17
Q.
18
break upon Mr. Gonzalez's arrival, you had just
19
asked me to repeat a question, so let me repeat
20
the question.
21
you can answer it.
22
I'll rephrase it.
23
know if State Street Partners has given Fifth
24
Third Bank any security apart from the mortgage
Mr. Rankin, before we took a short
If it makes sense to you, great, If it doesn't, tell me and The question is this:
Do you
Thomas Rankin
January 5, 2009
118 1
interest itself in the realty for its repayment
2
obligation on the mortgage loan?
3
A.
Not that I'm aware of.
4
Q.
Do you know if there are any guarantors
5
of State Street Partners' repayment obligation on
6
the mortgage loan?
7
A.
Yes.
8
Q.
What or who are the guarantors?
9
A.
Mr. Clark, Mr. Tipps, and State Street
10
Consultants.
11
Q.
Any others?
12
A.
Not that I'm aware of.
13
Q.
Do you know if there is a condition of
14
the mortgage that a certain percentage of the
15
space at 137 East State Street has to be leased?
16
A.
17
or remember.
18
Q.
19
Let's go back to the renegotiation of the terms of
20
the mortgage and just pin down a couple of things.
21
I don't know, or not that I'm aware of
Do you know what the -- strike that.
You told me that now the mortgage is
22
interest only, correct?
23
A.
As far as I'm aware of.
24
Q.
And then there is, what, a balloon
Thomas Rankin
January 5, 2009
119 1
payment of principal on maturity date.
2
correct?
3
A.
4
for I know -- I'm presuming that it's interest
5
only.
6
Q.
Have you read the mortgage documents?
7
A.
I may have, but I don't recall the
8
exact terms.
9
Q.
Did you read the mortgage note?
10
A.
I may have, but I don't remember the
11
exact terms.
12
Q.
13
note on behalf of State Street Partners?
14
A.
Which mortgage note?
15
Q.
Are there multiple mortgage notes at
16
this point?
17
A.
18
note and a extended mortgage note.
19
Q.
20
those again.
21
Is that
I don't know what the terms are except
Do you know who signed the mortgage
We've talked about an original mortgage
Fair enough.
Let's talk about both of
The original mortgage note, do you know
22
who signed it on behalf of State Street Partners?
23
A.
I don't recall.
24
Q.
The renegotiated mortgage note, if we
Thomas Rankin
January 5, 2009
120 1
can call it that, do you know who signed that on
2
behalf of State Street Partners?
3
A.
I don't recall.
4
Q.
Did you sign either of those notes on
5
behalf of State Street Partners?
6
A.
No.
7
Q.
Do you know who signed the guaranty
8
that State Street Consultants executed to assure
9
the repayment on the mortgage note?
10
A.
I don't recall.
11
Q.
In the scheme of things at Thomas A.
12
Rankin & Associates, do you consider State Street
13
Consultants, State Street Partners, and NSC
14
Consulting Corp. as one client?
15
A.
Yes.
16
Q.
Do you consider Mr. Clark to be part of
17
that one client?
18
A.
Yes.
19
Q.
You told me earlier today, quite a bit
20
earlier today, that you've got more than 80
21
clients in Thomas A. Rankin & Associates, correct?
22
A.
I do recall that.
23
Q.
Is the one client consisting of State
24
Street Consultants, State Street Partners, NSC
Thomas Rankin
January 5, 2009
121 1
Consulting Corp., and Mr. Clark your firm's
2
biggest client?
3
A.
Yes.
4
Q.
For how long has that been the case?
5
A.
Since 1999.
6
Q.
Based upon fee revenues from clients,
7
how many times larger is the State Street
8
Consultants client than any other client of your
9
firm?
10
A.
11
please?
12
correctly.
Can you ask that question again, I want to make sure I answer it
13
MR. CVETANOVICH:
14
MR. WEAVER:
Sure.
Sure.
Could you also -- the term
15
using State Street Consultants, do you mean the
16
conglomerate that you spoke of earlier?
17 18
MR. CVETANOVICH:
21
It's a little
awkward, but --
19 20
I do.
MR. WEAVER:
Do you want to call it the
group? MR. CVETANOVICH:
We can do that.
Let
22
me propose that to the witness and see if he finds
23
that acceptable.
24
MR. WEAVER:
I don't want to run your
Thomas Rankin
January 5, 2009
122 1
depo.
2
Just want to make sure we're clear. MR. CVETANOVICH:
We're all looking for
3
good communication.
4
Q.
5
I am referring to State Street Consultants, State
6
Street Partners, NSC Consulting Group, excuse me,
7
Consulting Corp., and Mr. Clark, insofar as they
8
are treated by your company as one client, that I
9
call them the group.
Mr. Weaver has just proposed that when
Is that okay with you, just
10
to facilitate communication?
11
A.
Yes.
12
Q.
Okay.
13
my question is, based upon fee revenues from
14
clients, how many times larger is the group than
15
any other client of your firm?
16
A.
It varies.
17
Q.
If you had to average it, on average is
18
it two times bigger, three times bigger, 20 times
19
bigger than your next largest client?
20
A.
21
not my biggest client.
22
my biggest client.
23
Q.
24
been your biggest client.
Then that's what we'll do.
Then
Several years it was smaller, or was And several years it was
But you've told me since 1999 it has
Thomas Rankin
January 5, 2009
123 1
A.
2
I need to fix that. MR. WEAVER:
I forgot about --
Clarify what you meant.
3
Q.
Please fix it.
4
A.
I forgot about a client that I had had
5
for several -- many -- years, yes.
6
Q.
7
that you forgot about it.
8
A.
Right.
9
Q.
Let's do it this way.
We won't tell your long-time client
I apologize for that. For 2006, 2007,
10
2008, has the group been your firm's largest
11
client?
12
A.
Yes.
13
Q.
For that period of time, how much
14
bigger has the group been than your firm's next
15
largest client, again, based upon fee revenue?
16
A.
Four times.
17
Q.
Have you read the State Street
18
Consultants' operating agreement?
19
A.
I have.
20
Q.
Are you conversant with its terms?
21
A.
No.
22
Q.
Do you know who are the members of
23
State Street Consultants?
24
A.
Yes.
Thomas Rankin
January 5, 2009
124 1
Q.
Who are they?
2
A.
Neil Clark, and that's how I prepare
3
the tax returns, based on Neil Clark being a
4
member.
5
Q.
Being the sole member?
6
A.
Yes.
7
Q.
You don't believe that Mr. Tipps is
8
also a member?
9
A.
I don't believe Mr. Tipps is a member.
10
Q.
Why do you say that?
11 12
MR. WEAVER:
we're talking about, please?
13 14
Can we ask what time frame
MR. CVETANOVICH:
I'm talking
presently.
15
MR. WEAVER:
16
MR. CVETANOVICH:
Thank you. Yeah.
17
A.
18
provided to Mr. Tipps showing zero capital, zero
19
earnings, and my definition of -- that, to me,
20
reflects that Mr. Tipps was not a member, and I
21
never heard anything to the contrary after that
22
K-1 was given to Mr. Tipps.
23
Q.
24
did have a membership interest in the entity?
I prepared a 2006 tax return with a K-1
Didn't that K-1 also reflect that he
Thomas Rankin
January 5, 2009
125 1
A.
Yes.
2
Q.
All right.
3
for State Street Consultants for 2007?
4
A.
No.
5
Q.
Did anyone do that?
6
A.
No.
7
Q.
It's too soon for 2008.
8
prepare K-1s for State Street Consultants for
9
2005?
Now, did you prepare K-1s
Did you
10
A.
Yes.
11
Q.
Was Mr. Tipps reflected as member on
12
the K-1s prepared for 2005?
13
A.
Yes.
14
Q.
The fact of the matter is Mr. Tipps has
15
been reflected as a member on the K-1s prepared
16
for State Street Consultants every year from the
17
very beginning of its existence, correct?
18
A.
19
prepared the tax return the first year, but I
20
don't recall if I did that return.
21
Q.
22
return, the K-1s have reflected that Mr. Tipps is
23
a member, correct?
24
A.
As far as I know, yes.
I'm not sure I
Every year you have prepared the tax
Yes.
Thomas Rankin
January 5, 2009
126 1
Q.
2
return, a federal tax return, for 2007?
3
A.
No.
4
Q.
Why not?
5
A.
The Internal Revenue Code states a
6
single member LLC does not file a entity tax
7
return.
8
Q.
What happens in lieu of that?
9
A.
A schedule C is filed on the single
Did State Street Consultants file a tax
10
member, along with the single member's individual
11
income tax return, or the sole member.
12
Q.
13
return preparation and filing for State Street
14
Consultants and for Neil Clark for calendar year
15
2007, you treated Mr. Clark as the sole member of
16
SSC?
17
A.
I did.
18
Q.
For 2006, did you file an entity tax
19
return for SSC?
20
A.
Yes.
21
Q.
Why did you do it in '06 but not '07?
22
A.
Because I determined that Mr. Tipps was
23
an member -- a member of State Street Consultants
24
for at least one minute of 2006.
Is it the case that in handling the tax
Thomas Rankin
January 5, 2009
127 1
Q.
What did you base that on?
2
A.
I based that on Mr. Tipps' retirement
3
agreement or asset purchase agreement and through
4
discussions with Neil Clark or Dan Rohletter.
5
Q.
Who is Dan Rohletter?
6
A.
Dan is an attorney with Carlile,
7
Patchen & Murphy.
8
Q.
9
Mr. Rohletter about this issue?
Why would you have a discussion with
10
A.
11
documents I just referred to.
12
Q.
13
connection with that exercise?
14
A.
15
Consultants.
16
Q.
17
personal income tax return for calendar year 2006?
18
A.
Yes.
19
Q.
Did he file a personal income tax
20
return for calendar year 2007?
21
A.
Yes.
22
Q.
Did State Street Consultants have a
23
profit, have a loss, or break even for calendar
24
year 2007?
Mr. Rohletter took part in drafting the
Do you know who he represented in
As far as I understand, State Street
Do you know if Neil Clark has filed a
Thomas Rankin
January 5, 2009
128 1
A.
Profit.
2
Q.
Was that profit reflected on Schedule C
3
of Mr. Clark's personal income tax return for
4
2007?
5
A.
Yes.
6
Q.
Did you personally prepare Mr. Clark's
7
income tax return for 2007?
8
A.
As an employee of my company, yes.
9
Q.
What's the significance of the way you
10
qualified your "yes" answer there?
11
didn't track that very well.
12
A.
13
an entity that's on the tax returns.
14
a tax return, I sign it on behalf of Thomas A.
15
Rankin & Company.
16
Q.
17
that you weren't acting outside the business?
18
it that simple?
19
A.
Yeah, it's pretty simple.
20
Q.
All right.
21
A.
I'm a simple guy.
22
Q.
There's a camera there.
23 24
I just -- I
I'm just -- wanted to make sure I have When I sign
So you're just trying to convey to me Is
To your knowledge, has Mr. Clark been the sole management authority in State Street
Thomas Rankin
January 5, 2009
129 1
Consultants since Mr. Tipps' retirement?
2
A.
To my knowledge, yes.
3
Q.
Do you recall when Mr. Tipps retired
4
from active lobbying?
5
A.
October 2005.
6
Q.
Have you ever reviewed the partnership
7
agreement of State Street Partners, PLL?
8
A.
Yes.
9
Q.
For what purpose?
10
A.
To review -- no specific purpose.
11
Q.
Do you recall when you reviewed it?
12
A.
Not exactly.
13
Q.
How many times have you reviewed it?
14
A.
Several, I'm sure.
15
Q.
When was the most recent time?
16
A.
Several months ago.
17
Q.
What was the purpose for your most
18
recent review of the partnership agreement?
19
A.
Just to try to become familiar with it.
20
Q.
Did you undertake that in connection
21
with the performance of any particular specific
22
task for State Street Partners?
23
A.
No.
24
Q.
Did you undertake that review for the
Thomas Rankin
January 5, 2009
130 1
purpose of putting yourself in a position to
2
better advise your client on particular matters?
3
A.
Possibly.
4
Q.
Do you have a recollection?
5
A.
No.
6
Q.
How many times have you reviewed the
7
operating agreement of State Street Consultants?
8
A.
I don't know specifically.
9
Q.
When's the most recent time you
10
reviewed that?
11
A.
Within 60 days.
12
Q.
What was the reason why you reviewed it
13
most recently?
14
A.
15
member.
16
Q.
17
the last 60 days?
18
A.
Yes.
19
Q.
Did anyone ask you to do that?
20
A.
Yes.
21
Q.
Who asked you to do that?
22
A.
Mr. Clark.
23
Q.
What specifically did he say to you?
24
A.
"See if Mr. Tipps is a member."
To see if Paul was a -- Mr. Tipps was a
Did you look back at that issue within
Thomas Rankin
January 5, 2009
131 1
Q.
2
agreement, did you do anything else?
3
A.
Yes.
4
Q.
What else?
5
A.
Looked at other agreements.
6
Q.
What other agreements?
7
A.
Asset purchase agreement, and SERP,
8
Supplemental Employee Retirement Plan.
9
Q.
Did you look at anything else?
10
A.
I don't recall.
11
Q.
Did you reach a conclusion?
12
A.
I reached my conclusion when I filed
13
the original tax return.
14
Q.
15
pursuant to Mr. Clark's request within the past 60
16
days, did you reach any new or different
17
conclusion?
18
A.
19
conclusion.
20
Q.
21
before?
22
A.
Yes.
23
Q.
This time you came to the conclusion
24
based upon a review of all those contracts you
Apart from reviewing the operating
When you went through this exercise
I have not reached a different or new
Did you come to the same conclusion as
Thomas Rankin
January 5, 2009
132 1
just named for us, correct?
2
A.
No.
3
Q.
Did reviewing those contracts or any of
4
those contracts lead to the conclusion that you
5
reached?
6
A.
No.
7
Q.
What then led you to conclude as
8
recently as 60 days ago that Mr. Tipps is not a
9
member of State Street Consultants?
10
A.
11
tax return for State Street Consultants.
12
Q.
13
as a consequence of reviewing all these documents?
14
A.
15
hasn't changed.
16
Q.
17
take a look at that issue for him?
18
A.
He asks me a lot.
19
Q.
Do you know why he asked you to do that
20
particular thing for him?
21
A.
To give him my thoughts, my opinion.
22
Q.
When you completed the exercise, did
23
you share with him your thoughts or your opinion?
24
A.
I concluded that when I filed the 2006
But you did not reach any conclusions
I'm not an attorney, and my conclusion
Do you know why Mr. Clark asked you to
I'm sure I did.
Thomas Rankin
January 5, 2009
133 1
Q.
What did you tell him?
2
A.
I didn't think Mr. Tipps was a member.
3
Q.
Did you tell him why?
4
A.
Yes.
5
Q.
What did you tell him?
6
A.
Advice of counsel that he had in 2006
7
reflected that.
8
Q.
What counsel are you referring to?
9
A.
Dan Rohletter.
10
Q.
Are you familiar with the fact that
11
there was an amendment to the limited liability
12
partnership agreement of State Street Partners?
13
A.
I don't recall seeing an amendment.
14
Q.
Are you aware that the governing
15
documents of State Street Partners designate
16
Mr. Tipps as the managing partner of State Street
17
Partners?
18
A.
I do recall seeing that.
19
Q.
Do you know if Mr. Tipps has, in fact,
20
acted to manage the affairs of State Street
21
Partners since his retirement?
22
A.
Not to my knowledge.
23
Q.
Do you know if during 2008 Mr. Tipps
24
has had to reassert himself as the managing
Thomas Rankin
January 5, 2009
134 1
partner of State Street Partners?
2
A.
Can you ask that again, please?
3
Q.
Certainly.
4
A.
Sorry.
5
Q.
Do you know if during 2008 Mr. Tipps
6
has had to reassert himself as the managing
7
partner of State Street Partners?
8
A.
9
had to reassert himself, but I'm under the
Has he had to?
I don't know if he has
10
presumption that he has asserted himself.
11
Q.
Do you know why?
12
A.
I can't comment on why Mr. Tipps
13
asserted himself.
14
Q.
15
as managing partner of State Street Partners
16
affected you in any way in the performance of your
17
obligations to the group?
18
A.
Not to this point.
19
Q.
Has Mr. Tipps given you or tried to
20
give you any directives insofar as you have been
21
performing services for State Street Partners?
22
A.
Can you ask that again?
23
Q.
Certainly.
24
A.
Time period?
Has Mr. Tipps asserting his prerogative
I'm sorry.
Has Mr. -Is there a time period
Thomas Rankin
January 5, 2009
135 1
that --
2
Q.
Yes.
3
A.
Okay.
4
Q.
Has Mr. Tipps during 2008 given you or
5
tried to give you any directives insofar as you
6
have been performing services for State Street
7
Partners?
8
A.
9
talking with Fifth Third in trying to facilitate a
The time period is 2008.
Mr. Tipps, from what I know, knew I was
10
refinance.
11
Q.
Was Mr. Tipps part of that process?
12
A.
Eventually Mr. Tipps took the process
13
over from what I understand.
14
Q.
15
discussions about Mr. Tipps taking over that
16
process?
17
A.
18
me Mr. Tipps was taking over that process.
19
Q.
20
as Public Policy Consultants, Incorporated?
21
A.
I know of the entity.
22
Q.
Is that one of your clients?
23
A.
No.
24
Q.
Has it ever been one of your clients?
Did you and Mr. Clark have any
Not that I recall.
Mr. Clark informed
Are you familiar with an entity known
Thomas Rankin
January 5, 2009
136 1
A.
No.
2
Q.
What do you know or understand that
3
entity to be?
4
A.
5
Mr. Tipps.
6
Q.
7
years back that entity transferred all of its
8
assets to State Street Consultants?
9
A.
Yes.
10
Q.
I think you alluded earlier to the
11
asset purchase agreement, did you not?
12
A.
I did.
13
Q.
And you said you've seen that document,
14
you reviewed that document?
15
A.
I have seen it.
16
Q.
Do you know anything else about Public
17
Policy Consultants?
18
A.
19
was a lobbying business.
20
Q.
Do you know if it's still in existence?
21
A.
I don't know if Public Policy
22
Consultants is still in business or existence.
23
Q.
24
Corp., correct?
My understanding is an entity owned by
You know, do you not, that a couple of
I don't know anything else except it
You are familiar with NSC Consulting
Thomas Rankin
January 5, 2009
137 1
A.
Yes.
2
Q.
What do you know that to be?
3
A.
An entity owned by Mr. Clark.
4
Q.
Do you know the nature of its business?
5
A.
A lobbying business.
6
Q.
Do you know if it is actively engaged
7
in the lobbying business?
8
A.
Yes.
9
Q.
For how long have you known NSC
10
Consulting Corp. to be actively engaged in the
11
lobbying business?
12
A.
Since 1986.
13
Q.
Do you know how many clients it
14
currently has?
15
A.
Eight.
16
Q.
Can you name them?
17
A.
No.
18
Q.
Can you name any of them?
19
A.
Yes.
20
Q.
Tell us the ones you can name.
21
A.
Unisys, Washington State University,
22
The Limited, Ohio Nurses Association, Ohio Society
23
of CPAs, Ohio Soft Drink Association.
24
I can remember right now.
That's all
Thomas Rankin
January 5, 2009
138 1
Q.
That's good.
2
A.
Yeah.
3
the ball game.
4
Q.
5
clients throughout 2008?
6
A.
7
each one I listed.
8
Q.
How about 2007?
9
A.
Yes.
10
Q.
How about 2006?
11
A.
Yes.
12
Q.
Did NSC Consulting Corp. have any other
13
clients during 2008?
14
A.
Possibly.
15
Q.
Don't know?
16
That's six out of eight.
If I can only hit well that in Go ahead.
Has it had all of those entities as
I'll have to go back and think about Yes.
MR. GONZALEZ:
I'm sorry.
Objection.
17
He said they were eight and he named six.
18
Q.
19
the eight --
20
I understand that.
MR. GONZALES:
I mean other than
Okay.
21
Q.
22
other clients during 2008?
23
A.
Not that I'm aware of.
24
Q.
Did it have any other clients during
-- did NSC Consulting Corp. have any
Thomas Rankin
January 5, 2009
139 1
2007?
2
A.
Yes.
3
Q.
How many others?
4
A.
I can only recall two.
5
Q.
What are their names?
6
A.
American Cancer Society and American
7
Heart Association.
8
Q.
9
clients during calendar year 2006?
Did NSC Consulting Corp. have any other
10
A.
I can't recall.
11
Q.
How many employees does NSC Consulting
12
Corp. have on the payroll?
13
A.
Zero.
14
Q.
Was that true throughout 2008?
15
A.
Yes.
16
Q.
Was that true throughout 2007?
17
A.
Yes.
18
Q.
Was that true throughout 2006?
19
A.
I don't recall.
20
Q.
Can you ever recall a time when NSC
21
Consulting Corp. had employees on its payroll?
22
A.
Yes.
23
Q.
How far back is that?
24
A.
Can you rephrase that, please?
Thomas Rankin
January 5, 2009
140 1
Q.
2
a time when NSC Consulting Corp. had employees on
3
its payroll.
4
far back was that.
5
A.
1986.
6
Q.
Can you recall any time since 1986 when
7
NSC Consulting Corp. has had employees?
8
A.
9
1993, actually.
Yes, sir.
I asked can you ever recall
You said yes.
Yes.
And I asked you how
And I need to change that to I don't have --
10
Q.
The 1986 to 1993?
11
A.
Yes.
12
Q.
Okay.
13
any time more recently than 1993 when NSC
14
Consulting Corp. has had employees on its payroll?
15
A.
Yes.
16
Q.
When?
17
A.
2005.
2004.
18
Q.
Okay.
So as best you recall, NSC
19
Consulting Corp. had employees on its payroll from
20
1993 through 2005, correct?
21
A.
And possibly 2006.
22
Q.
What individual do you believe might
23
have been an employee of NSC Consulting Corp. in
24
2006?
I'm with you.
2003.
Can you remember
And back.
Thomas Rankin
January 5, 2009
141 1
A.
Lisa Rankin.
2
Q.
Anyone else?
3
A.
Possibly Neil Clark.
4
Q.
Anyone else?
5
A.
Not that I recall.
6
Q.
Are there any books or records of NSC
7
Consulting Corp. that you could consult to
8
ascertain when it last had employees and who those
9
employees were?
10
A.
Yes.
11
Q.
What would you consult?
12
A.
My QuickBooks.
13
Q.
You've told me that NSC Consulting
14
Corp. had no employees in 2008, 2007, and
15
initially you said 2006, but then you said, well,
16
2006, maybe Lisa Rankin was still an employee,
17
maybe Neil Clark was an employee, you weren't
18
sure.
19
reference.
20
So let's start with that frame of
If NSC Consulting Corp. has no
21
employees, how does it render lobbying services to
22
these eight and in some years eight-plus clients
23
that you've said that it has?
24
A.
I don't know.
Thomas Rankin
January 5, 2009
142 1
Q.
2
services that NSC Consulting Corp. as an entity
3
renders to its clients?
4
A.
Yes.
5
Q.
Who are those people?
6
A.
Neil Clark, Andrew Minton, Aaron
7
Ockerman.
8
Q.
Anyone else?
9
A.
Not that I know of.
10
Q.
Those people are all lobbyists for
11
State Street Consultants, correct?
12
A.
As far as I know.
13
Q.
Are all eight of those clients of NSC
14
Consulting Corp. on retainers?
15
A.
Yes.
16
Q.
When the clients of NSC Consulting
17
Corp. make their retainer payments, to what entity
18
do the moneys go?
19
A.
NSC Consulting Corp.
20
Q.
Do the moneys then go into some account
21
of NSC Consulting Corp.?
22
A.
I would presume.
23
Q.
Do the moneys in some fashion or
24
another then flow from NSC Consulting Corp. over
Do you know who actually provides the
Thomas Rankin
January 5, 2009
143 1
to State Street Consultants?
2
A.
Possibly.
3
Q.
Do you know?
4
A.
Yes.
5
Q.
Do they or don't they?
6
A.
Yes.
7
Q.
Tell me how that happens.
8
different question, but we may have to come back
9
to this one.
10
Let me ask a
Does NSC Consulting Corp. pay SSC,
11
meaning State Street Consultants, for the services
12
that State Street Consultants' lobbyists render to
13
NSC Consulting Corp.'s clients?
14
A.
No.
15
Q.
Does State Street Consultants ever
16
receive compensation from anyone for the services
17
that its employees provide to NSC Consulting
18
Corp.'s clients?
19
A.
20
for a second on that, please.
21
Q.
22
receive compensation from anyone for the services
23
that its employees provide to NSC Consulting
24
Corp.'s clients?
As far as I'm aware.
Go back to the beginning.
I lost you
Does State Street Consultants ever
Thomas Rankin
January 5, 2009
144 1
A.
I don't know.
2
Q.
Who would you expect to know that?
3
A.
Mr. Clark.
4
Q.
You are the accountant for both
5
entities, correct?
6
A.
Yes.
7
Q.
And you see the books and records for
8
both entities, correct?
9
A.
Yes.
10
Q.
Can you not tell from the financial
11
books and records of State Street Consultants and
12
NSC Consulting Corp. to which you have access
13
whether NSC Consulting Corp. is paying State
14
Street Consultants for the services that State
15
Street Consultants' employees render to NSC's
16
clients?
17
A.
18
ago.
19
Q.
Well, I don't think so.
20
A.
Okay.
21
Q.
Can you not tell from looking at the
22
books and records?
23
A.
Yes.
24
Q.
Then does NSC Consulting Corp. pay
I thought I answered that two questions
Thomas Rankin
January 5, 2009
145 1
State Street Consultants for the services that
2
State Street Consultants' employees render to NSC
3
Consulting Corp.'s clients?
4
A.
5
couple times ago, regarding SSC employees.
6
Q.
7
receive compensation from anyone for the services
8
that its employees provide to NSC Consulting
9
Corp.'s clients?
No.
That's one I thought I answered a
Does State Street Consultants ever
10
A.
Not that I'm aware of.
11
Q.
It is the case, is it not, that State
12
Street Consultants' employees are paid by State
13
Street Consultants?
14
A.
Yes.
15
Q.
Does NSC Consulting Corp., to your
16
knowledge, make any payments whatsoever to State
17
Street Consultants?
18
A.
Define "payments".
19
Q.
Remittances of moneys for goods or
20
services rendered.
21
A.
No.
22
Q.
Is there any other way you would define
23
payments?
24
A.
I might not define payments any
Thomas Rankin
January 5, 2009
146 1
differently, but you might.
2
say payment.
3
sure that your payment and my payment were the
4
same.
5
Q.
6
given you?
7
A.
It sounds like it.
8
Q.
All right.
A loan, someone might
I have -- so I just wanted to make
Are they, based on the definition I've
9
To your knowledge, do any contracts
10
exist between State Street Consultants and NSC
11
Consulting Corp.?
12
A.
Not to my knowledge.
13
Q.
To your knowledge, does NSC Consulting
14
Corp. ever pay on behalf of State Street
15
Consultants any of State Street Consultants'
16
payment obligations?
17
A.
One more time.
18
Q.
That's all right.
19
does NSC Consulting Corp. ever pay on behalf of
20
State Street Consultants any of State Street
21
Consultants' payment obligations?
22
A.
23 24
I'm sorry. To your knowledge,
Not to my knowledge. MR. WEAVER:
Dan, are you including
salary as part of your question when you say
Thomas Rankin
January 5, 2009
147 1
payment obligations?
2 3
MR. CVETANOVICH:
I didn't mean to
exclude anything.
4
MR. WEAVER:
Okay.
5
Q.
Which member or members of the group --
6
A.
Sorry.
7
Q.
That's all right.
8
A.
Bad -- bad taste.
9
Q.
All right.
Which member or members of
10
the group as we defined that earlier pay the fees
11
of your firm?
12
A.
NSC Consulting Corp.
13
Q.
Is the amount that you are paid then
14
allocated among the entities and persons for whom
15
your company provides services pursuant to the
16
retainer?
17
A.
I treat them, and have, as one group.
18
Q.
You've done that for how long?
19
A.
The group as a whole since 2006.
20
Q.
Does Neil Clark receive compensation in
21
any form from State Street Consultants?
22
A.
No.
23
Q.
Money.
24
A.
Yes.
You need to define "compensation". Does he receive money --
Thomas Rankin
January 5, 2009
148 1
Q.
2
Consultants?
3
A.
Yes.
4
Q.
In what form?
5
A.
Distribution.
6
Q.
Anything else?
7
A.
No.
8
Q.
Does Mr. Clark receive compensation or
9
money in any form from NSC Consulting Corp.?
-- in any form from State Street
10
A.
Yes.
11
Q.
In what form does he receive
12
compensation from NSC Consulting Corp.?
13
A.
He receives money through distribution.
14
Q.
So is it the case, Mr. Rankin, that
15
from neither of those two entities does Mr. Clark
16
receive a salary?
17
A.
18
that -- the term "salary," no salary.
19
Q.
20
hourly wages?
21
A.
No.
22
Q.
Does he receive any bonus payments?
23
A.
No.
24
Q.
Does he receive any retainer payments?
A salary in the term that you and I or
Does he receive compensation based upon
Thomas Rankin
January 5, 2009
149 1
A.
No.
2
Q.
Does he receive expense reimbursement
3
from either of those two entities?
4
A.
Not that I'm aware of.
5
Q.
Do either of those two entities provide
6
Mr. Clark any in-kind compensation or
7
remuneration?
8
A.
Yes.
9
Q.
What types of in-kind compensation or
10
remuneration does Mr. Clark receive from either
11
State Street Consultants or NSC Consulting Group?
12
A.
13
insurance premiums; expenses that are not
14
deductible for business purposes is treated as
15
remuneration.
16
Q.
Anything else?
17
A.
Not that I'm aware of.
18
Q.
Which entity pays the premiums on
19
Mr. Clark's disability insurance?
20
A.
NSC Consulting Corporation.
21
Q.
Do you know what those amount to per
22
month or per quarter?
23
A.
900 a month, maybe.
24
Q.
Which entity pays Mr. Clark's life
Disability insurance coverage, life
Thomas Rankin
January 5, 2009
150 1
insurance premiums?
2
A.
3
insurance premiums and NSC Consulting has paid
4
life insurance premiums.
5
Q.
On the same policy?
6
A.
Possibly.
7
Q.
How many policies of life insurance
8
exist on Mr. Clark's life, the premiums of which
9
are paid by one or both of these entities?
State Street Consultants has paid life
10
A.
11
or both.
12
Q.
13
the premiums on a certain policy and the other
14
entity pays for the premiums on a different
15
policy?
16
A.
17
I don't keep track of which premiums are paid on
18
which policy.
19
Q.
20
policies?
21
A.
22
the owner of some policy -- several policies.
23
Q.
All four?
24
A.
And Paul Tipps is an owner of a policy
Some of the premiums may be paid by one Four policies, possibly. Is it the case that one entity pays for
I've never looked at that specifically.
Do you know who are the owners of the
My recollection is that Neil Clark is
Thomas Rankin
January 5, 2009
151 1
also.
2
Q.
Does that account for the four?
3
A.
Kathy Clark is an owner of a policy.
4
Q.
How many have we accounted for now?
5
A.
Five, possibly.
6
Q.
Okay.
7
owner of one policy on the life of Neil Clark?
8
A.
Yes.
9
Q.
You believe Kathy Clark is the owner of
You believe Paul Tipps is the
10
one policy on the life of Neil Clark?
11
A.
Correct.
12
Q.
And you believe that Mr. Clark himself
13
is the owner of the other several policies on his
14
life?
15
A.
Correct.
16
Q.
And the premiums of all of those
17
policies are paid by one or another of these two
18
entities?
19
A.
20
Kathy Clark's policy.
21
Q.
22
premium on the policy that Mr. Tipps owned?
23
A.
State Street Consultants.
24
Q.
Do you know if that policy is current?
I don't recall who pays the premium on
Do you recall which entity paid the
Thomas Rankin
January 5, 2009
152 1
A.
I don't.
2
Q.
Do you know if at a point State Street
3
Consultants ceased to pay the premiums on that
4
policy?
5
A.
I heard that.
6
Q.
From whom did you hear that?
7
A.
Neil Clark.
8
Q.
When did he tell you that?
9
A.
November.
10
Q.
Did he tell you who determined to have
11
State Street Consultants cease paying the premiums
12
on that insurance policy?
13
A.
14 15
I don't recall who determined that. THE VIDEOGRAPHER:
Mr. Cvetanovich,
you've got about four minutes left.
16
MR. CVETANOVICH:
Thank you, Jeremy.
17
Q.
18
those agreements that you told us earlier you had
19
reviewed Mr. Clark has an obligation to pay the
20
premiums on that policy on his life for the
21
benefit of Mr. Tipps?
22
A.
23
sorry.
24
Q.
Do you know that pursuant to one of
You have to rephrase that for me.
Certainly.
I'm
Do you know that pursuant
Thomas Rankin
January 5, 2009
153 1
to one of those agreements that you told us
2
earlier you had reviewed Mr. Clark has an
3
obligation to pay the premiums on that policy on
4
his life for the benefit of Mr. Tipps?
5
A.
6
agreement.
7
Q.
8
Consultants had been paying the premiums on that
9
policy up until this point in November or
I'm not aware of that part of
Do you know why State Street
10
thereabouts when Mr. Clark told you State Street
11
Consultants would no longer pay those premiums?
12
A.
No.
13
Q.
Do you know if State Street Consultants
14
continues to pay the premiums on others of the
15
policies on the life of Mr. Clark?
16
A.
17
insurance premium payment since November.
18
were referring back to the November date.
19
Q.
So the answer is you don't know?
20
A.
I don't know.
21
back to the November date.
22
Q.
23
disability insurance premiums and life insurance
24
premiums paid by one or another of these entities.
I don't know if there has been an You
If you were referring
You've told me that Mr. Clark had
Thomas Rankin
January 5, 2009
154 1
Did he also have health insurance premiums paid
2
for him by one or the other of State Street
3
Consultants and NSC Consulting Corp.?
4
A.
Yes.
5
Q.
Which of the entities paid his health
6
insurance premiums?
7
A.
State Street Consultants.
8
Q.
For how long has that been the case?
9
A.
I don't recall exactly.
10
Q.
Does that continue to be the case?
11
A.
Yes.
12
Q.
Are there any other items of in-kind
13
compensation or remuneration that Mr. Clark
14
receives either from State Street Consultants or
15
from NSC Consulting Corp.?
16
A.
17
potentially.
18
Q.
19
paid for Mr. Clark by either State Street
20
Consultants or NSC Consulting Corp.
21
A.
22
expenses are, but --
23
Q.
Do you know any of them?
24
A.
Personal use of meals at New Albany
Not -- nonbusiness expenses,
Tell me what nonbusiness expenses are
I don't know specifically what the
Thomas Rankin
January 5, 2009
155 1
Country Club.
2
recall that one specifically.
3
Q.
Any others?
4
A.
I can't remember others.
5 6
I can recall that.
THE VIDEOGRAPHER:
Or -- I can
We're going to have
to change.
7
MR. CVETANOVICH:
Go ahead, Jeremy.
8
THE VIDEOGRAPHER:
We are off the
9
record at 1507.
10
(A brief recess is taken.)
11
THE VIDEOGRAPHER:
We are back on the
12
record at 1514.
13
Q.
14
State Street Consultants have a 401(k) plan for
15
its employees?
16
A.
Yes.
17
Q.
Is it the case that State Street
18
Consultants' employees can determine for
19
themselves whether they will be participants in
20
the plan?
21
A.
That's what I understand.
22
Q.
And do they get to determine within
23
limits set by the plan how much they will have
24
withheld from their paychecks to contribute to the
Mr. Rankin, to your knowledge, does
Thomas Rankin
January 5, 2009
156 1
plan?
2
A.
Yes.
3
Q.
Does State Street Consultants, in fact,
4
withhold 401(k) contributions from the paychecks
5
of those employees who choose to participate in
6
the plan?
7
A.
That's my understanding.
8
Q.
And when State Street Consultants
9
withholds 401(k) contributions from employee
10
paychecks, what does it then do with the money?
11
A.
12
fund holder, whatever you want to call it.
13
Q.
Custodian, can we use that term?
14
A.
Good term.
15
Q.
All right.
16
within which those withheld 401(k) contributions
17
have to be remitted to the custodian?
18
A.
I'm sure there is.
19
Q.
Do you know what it is?
20
A.
I don't exactly.
21
Q.
Do you know approximately?
22
A.
Guess?
23
Q.
If you know or as much as you know.
24
A.
My guess is it's 30 days after the --
Remit to the 401(k) administrator or
Is there a time limit
Thomas Rankin
January 5, 2009
157 1
the payroll date, or 30 days after the month ended
2
that the payroll occurred.
3
Q.
4
withheld from employee paychecks to go into their
5
401(k) accounts, State Street Consultants doesn't
6
get to hang on to that money indefinitely,
7
correct?
8
A.
Correct.
9
Q.
And it doesn't get to use that money.
Whichever way that is, when moneys are
10
That's the employees' money, correct?
11
A.
It's the custodian's money.
12
Q.
All right.
13
money for the benefit of the plan participants,
14
correct?
15
A.
Yes.
16
Q.
To your knowledge, have there been
17
instances when State Street Consultants has been
18
delinquent in remitting the employee withholdings
19
to the 401(k) plan custodian?
20
A.
I don't know.
21
Q.
Are there documents to which you could
22
refer that would tell you the answer to that
23
question?
24
A.
Yes.
The custodian holding that
Thomas Rankin
January 5, 2009
158 1
Q.
What documents?
2
A.
I would need to review the law, so I
3
would need the Internal Revenue Code.
4
need the specific payroll dates, and I would need
5
the amounts withheld on those specific dates to
6
properly determine if State Street Consultants was
7
indeed late.
8
Q.
9
State Street Consultants would be late in
I would
Do you know whether in instances where
10
remitting withheld 401(k) contributions it would
11
get some kind of a reminder from the 401(k)
12
service company used by State Street Consultants?
13
A.
I don't know if that occurs.
14
Q.
What is the process for remittance of
15
moneys withheld from employee paychecks to be
16
contributed to the 401(k) plan?
17
A.
18
for State Street Consultants.
19
Q.
20
whatsoever?
21
A.
No.
22
Q.
Do you determine when remittances are
23
due to the 401(k) plan custodian?
24
A.
Ms. Harrison takes care of that process
Do you have any role in that process
No.
Thomas Rankin
January 5, 2009
159 1
Q.
2
discussions with employees of State Street
3
Consultants regarding its periodic delinquency in
4
remitting the funds withheld from employee
5
paychecks for 401(k) contributions?
6
A.
7
there because I don't know if they're delinquent
8
payments or not.
9
Q.
Have you been a party to any
I have to put the word "perceived" in
But you've been a party to such
10
discussions?
11
A.
Yes.
12
Q.
With whom?
13
A.
Aaron Ockerman, Andrew Minton.
14
Q.
Anyone else?
15
A.
Not that I can recall.
16
Q.
Did you speak with the two of those
17
gentlemen together or one at a time?
18
A.
I don't recall.
19
Q.
What conversation did you have with
20
Mr. Minton about that?
21
A.
22
401(k) contribution was not paid timely.
23
Q.
What did you say to him in response?
24
A.
Check with Mr. Clark.
Mr. Minton thought or perceived his
Thomas Rankin
January 5, 2009
160 1
Q.
2
with Mr. Minton about that?
3
A.
Not that I recall.
4
Q.
What discussion did you have with
5
Mr. Ockerman about a perceived delinquency in
6
State Street Consultants remitting his withheld
7
401(k) contributions to the custodian?
8
A.
Same as Mr. Minton's.
9
Q.
Did you give the same --
10
A.
In that context.
11
Q.
Excuse me.
12
response to Mr. Ockerman?
13
A.
Yes.
14
Q.
Did you have any further discussions
15
with him about that?
16
A.
Not that I recall.
17
Q.
Do you know of any other employees of
18
State Street Consultants who had the perception
19
that their withheld 401(k) moneys were not being
20
paid into the plan on a timely basis?
21
A.
22
perception.
23
perception.
24
Q.
Did you have any further discussion
Did you give the same
I'm not sure if anyone else had that I don't know if anyone else had that
Are you familiar with an entity known
Thomas Rankin
January 5, 2009
161 1
as Paychex?
2
A.
Yes.
3
Q.
What is Paychex?
4
A.
A payroll service company.
5
Q.
Is that a payroll service company that
6
State Street Consultants uses?
7
A.
8
called Paycor, and I often -- I have some
9
with Paycor also, so --
I think so.
There's another interest clients
10
Q.
11
Consultants uses the services of one or the other
12
of those two entities?
13
A.
Yes.
14
Q.
You're just not sure which is the
15
proper name; is that correct?
16
A.
There's a "pay" in front.
17
Q.
But you know it's one of the two?
18
A.
Yes.
19
Q.
Are you aware that at a point in time
20
State Street Consultants utilized a service
21
offered by that payroll services company called
22
Taxpay?
23
A.
Yes.
24
Q.
Do you know if State Street Consultants
Do you know that State Street
Thomas Rankin
January 5, 2009
162 1
continues to use that service offered by this
2
payroll services company?
3
A.
No.
4
Q.
No, it does not?
5
A.
It does not use Taxpay.
6
Q.
Would you explain to us, please, what
7
the Taxpay service is.
8
A.
9
from an employer account and places the funds in
Paycor or -chex withdraws the funds
10
escrow until taxes, those withholdings, are due to
11
particular agencies.
12
Q.
13
company make the remittances to the taxing
14
authorities?
15
A.
Yes.
16
Q.
Do you recall when State Street
17
Consultants stopped using that service of its
18
payroll services company?
19
A.
December of 2006.
20
Q.
Do you know who made the decision that
21
State Street Consultants would cease to use that
22
service?
23
A.
Mr. Clark.
24
Q.
Did you make a recommendation to
And then does the payroll services
Thomas Rankin
January 5, 2009
163 1
Mr. Clark in respect of whether State Street
2
Consultants should continue to use that service?
3
A.
Not a recommendation.
4
Q.
Did you consult with him about that
5
decision?
6
A.
Yes.
7
Q.
Tell me what discussions you had with
8
Mr. Clark about that.
9
A.
Mr. Clark was informed that he can
10
pay -- he can pay payroll taxes not using the
11
Taxpay service.
12
Q.
Informed by whom?
13
A.
Informed by me.
14
Q.
Is it your understanding that when so
15
informed by you that was the first time that
16
Mr. Clark had become aware of that?
17
A.
No.
18
Q.
Is it something that he had known
19
before you and he discussed it?
20
A.
Yes.
21
Q.
What discussion did you and he then
22
have about whether that was a desirable service
23
for State Street Consultants to utilize?
24
A.
Can you repeat the question, please?
Thomas Rankin
January 5, 2009
164 1
Q.
2
understand how this decision came about to stop
3
using the Taxpay service offered by the payroll
4
services company.
5
A.
Sure.
6
Q.
What discussion did you and Mr. Clark
7
have about pros and cons that culminated in him
8
making the decision to discontinue the service?
9
A.
A pro is --
10
Q.
I understand -- excuse me.
11
for interrupting, but I want to know what you and
12
he discussed, not what occurs to you today, but
13
what did you and he discuss?
14
A.
15
escrow and payments are made for you.
16
those funds are removed from your account up to
17
seven days in advance of when they are due.
18
Q.
19
else?
20
A.
21
to pay payroll taxes using either method.
22
Q.
23
Are you saying that your advice to Mr. Clark was
24
either is fine?
Certainly.
I'm just trying to
I apologize
A pro is the withholdings are placed in A con is
Did you and Mr. Clark discuss anything
My advice is to -- or was to continue
I need to be sure I understand that.
Thomas Rankin
January 5, 2009
165 1
A.
2
tax pay service or not.
3
Q.
Did you recommend one over the other?
4
A.
I may have told Mr. Clark there is a
5
different payroll service fee structure, but that
6
may be minimal.
7
Q.
8
because you just said, I may have told him that.
9
Do you remember telling him that?
Either is totally acceptable, to use a
Now, do you remember telling him that,
10
A.
Yes.
11
Q.
And after telling him that, did you
12
ground a recommendation, in part, on that
13
difference?
14
A.
No.
15
Q.
What ultimately did you recommend to
16
Mr. Clark or advise Mr. Clark that State Street
17
Consultants ought to do?
18
A.
Pay their taxes.
19
Q.
Of course you would advise that, but
20
did you recommend that he continue to do it
21
through the use of the Paychex Taxpay service or
22
Paycor Taxpay service, whichever that is, or did
23
you instead recommend that State Street
24
Consultants do that for itself?
Thomas Rankin
January 5, 2009
166 1
A.
2
both acceptable ways to pay your tax.
3
Q.
4
discontinue using the Taxpay service, correct?
5
A.
Yes.
6
Q.
It's true, is it not, that he
7
determined to discontinue the use of that service
8
so that State Street Consultants could hang on to
9
the employees' money a little longer, correct?
I don't recall my recommendation of
What Mr. Clark ultimately did was to
10
A.
11
remit the funds closer to the due date.
12
Q.
Later?
13
A.
Yes.
14
Q.
Okay.
15
hanging on to the money a little longer, right?
16
A.
17
Holding, maybe.
18
Q.
And using, correct?
19
A.
I don't know if he specifically used
20
that for --
21
Q.
22
ability of State Street Consultants if it would
23
hang on to that money longer being able to use
24
that money?
So that State Street Consultants could
And that's the same thing as
Hanging on is a relative term.
Did you and Mr. Clark talk about the
Thomas Rankin
January 5, 2009
167 1
A.
2
the money would not be there to take out in the
3
first place.
4
Q.
5
withheld from employee paychecks?
6
A.
7
cover payroll.
8
Q.
9
discontinuing use of the Taxpay service as a way
Mr. Clark was concerned possibly that
Why would that be if the money is
There may not have been enough money to
So is it the case that Mr. Clark saw
10
to defer the point in time when State Street
11
Consultants had to be able to cover its payroll?
12
A.
Possibly.
13
Q.
Did he discuss that with you?
14
A.
Yes.
15
Q.
Did he say that to you?
16
A.
I don't recall specifically him saying
17
that.
18
Q.
19
something he felt would be desirable about
20
discontinuing use of the Taxpay service?
21
A.
Yes.
22
Q.
Are you aware of any person who has
23
ever received a paycheck from State Street
24
Consultants but who was not at that time an
But did you understand that that was
Thomas Rankin
January 5, 2009
168 1
employee of State Street Consultants?
2
A.
3
paycheck was an employee.
4
Q.
Does that mean you don't know?
5
A.
Everybody would have been an employee.
6
Q.
Let me ask a little bit different
7
question.
Are you aware of any persons who were
8
reflected as employees on the payroll records of
9
State Street Consultants and who, in fact,
I would presume anybody who got a
10
received paychecks from State Street Consultants
11
but who did not provide services to State Street
12
Consultants or its clients?
13
A.
14
all of State Street Consultants' employees.
15
Q.
16
notwithstanding, do you know of any instance when
17
someone was reflected as a payroll[sic] on the
18
payroll records, received a paycheck, but was not
19
then currently providing services to State Street
20
Consultants or its clients?
21
A.
To the best of my knowledge, no.
22
Q.
Do you know whether -- well, let me
23
start my question over.
24
I don't know, nor do I keep track of,
That's certainly fair enough, but that
Do you know a person named Brittany
Thomas Rankin
January 5, 2009
169 1
Clark?
2
A.
Yes.
3
Q.
Who do you understand Brittany Clark to
4
be?
5
A.
Neil Clark's daughter.
6
Q.
Do you know whether Brittany Clark has
7
ever been an employee of State Street Consultants?
8
A.
Yes.
9
Q.
Do you know during what periods of time
10
she's been an employee of State Street
11
Consultants?
12
A.
2008.
13
Q.
Any other periods of time?
14
A.
Not that I'm aware of.
15
Q.
During what portions of 2008 has
16
Brittany Clark been an employee of State Street
17
Consultants?
18
A.
Six months, maybe.
19
Q.
Which part of the year?
20
A.
Latter.
21
Q.
Do you know what her position is with
22
State Street Consultants?
23
A.
No.
24
Q.
Do you know what her job duties are for
Thomas Rankin
January 5, 2009
170 1
State Street Consultants?
2
A.
No.
3
Q.
Is she someone who over the course of
4
the past six months you would see regularly at the
5
offices of State Street Consultants?
6
A.
No.
7
Q.
You do know that she's a full-time
8
college student, correct?
9
A.
Yes.
10
Q.
And you do know that she's attending
11
college in Boston, correct?
12
A.
Yes.
13
Q.
Do you know whether during the period
14
of time when she's been away at college in Boston
15
Brittany Clark has been carried as an employee on
16
the payroll records of State Street Consultants
17
and receiving paychecks from State Street
18
Consultants?
19
A.
20
during her time in -- can you repeat that?
21
sorry.
22
Q.
23
of time when she's been away at college in Boston,
24
Brittany Clark has been carried as an employee on
I almost forgot the question.
But I'm
Do you know whether during the period
Thomas Rankin
January 5, 2009
171 1
the payroll records of State Street Consultants
2
and receiving paychecks from State Street
3
Consultants?
4
A.
Yes.
5
Q.
Do you know why that is?
6
A.
No.
7
Q.
Do you know who made the determination
8
to pay Brittany Clark as an employee,
9
notwithstanding that she was away at college?
10
A.
Mr. Clark.
11
Q.
Do you know if anyone else participated
12
in that decision?
13
A.
Not that I'm aware of.
14
Q.
Have you had a discussion with anyone
15
about that?
16
A.
Not that I remember.
17
Q.
Never talked with Mr. Clark about that?
18
A.
He did inform me he was employing
19
Brittany.
20
Q.
21
continue to pay her after she went away to
22
college?
23
A.
24
that or not.
Did he inform you that he was going to
I don't recall if he informed me of
Thomas Rankin
January 5, 2009
172 1
Q.
2
that?
3
A.
Not that I recall.
4
Q.
Did you express any concerns or
5
reservations about that state of affairs to
6
Mr. Clark?
7
A.
No.
8
Q.
Have you expressed any concerns or
9
reservations about that state of affairs to anyone
Have you talked with anyone else about
10
else?
11
A.
No.
12
Q.
Are you concerned about that?
13
A.
I am not concerned to the extent
14
Ms. Clark is performing services.
15
Q.
16
performing services for State Street Consultants
17
while she's away at college in Boston?
18
A.
I don't have knowledge of that.
19
Q.
Have you inquired about that?
20
A.
No.
21
Q.
Has anyone represented to you that
22
Brittany Clark is providing services to State
23
Street Consultants while she is away in Boston
24
going to college?
Do you have knowledge that she is
Thomas Rankin
January 5, 2009
173 1
A.
No.
2
Q.
If Ms. Clark is not, in fact,
3
performing services for State Street Consultants
4
but is receiving a paycheck from them, would that
5
give you concern?
6
A.
Possibly.
7
Q.
Why possibly?
8
A.
Yes.
9
Q.
That would trouble you, would it not?
10
A.
I don't -- yeah.
11
Q.
You know that wouldn't be right, true?
12
A.
Right.
13
Q.
And if you knew that were going on,
14
wouldn't you have a discussion with Mr. Clark
15
about that?
16
A.
Yes.
17
Q.
And would you counsel him that he
18
shouldn't be doing that?
19
A.
Yes.
20
Q.
Do you know of anyone else who has been
21
carried as a payroll on the payroll records --
22
excuse me.
23 24
Yes.
Let me start over.
I misspoke.
Do you know anyone else who has been carried as an employee on the payroll records of
Thomas Rankin
January 5, 2009
174 1
State Street Consultants and who has received
2
paychecks from State Street Consultants where
3
there is some question about whether they're
4
providing services to State Street Consultants or
5
its clients?
6
A.
Yes.
7
Q.
What other employees or nominal
8
employees?
9
A.
Sam Moore, Colleen Lora.
I think
10
that's all.
11
Q.
12
correct?
13
A.
Woman friend.
14
Q.
All right.
15
A.
She's of age.
16
Q.
Okay.
17
How old a woman is she?
18
A.
I'm sorry?
19
Q.
How old a woman is she?
20
A.
I don't know.
21
Q.
How long, to your knowledge, have she
22
and Mr. Clark been seeing each other?
23
A.
Two years, possibly.
24
Q.
And they're living together, correct?
Colleen Lora is Mr. Clark's girlfriend,
I've never met Ms. --
I won't ask you of age for what.
Thomas Rankin
January 5, 2009
175 1
A.
That's my understanding.
2
Q.
Do you know how long they've been
3
living together?
4
A.
I don't.
5
Q.
She was formerly an employee there,
6
right?
7
MR. GONZALEZ:
Objection.
8
Q.
You may respond.
9
A.
I think she still is.
10
Q.
Once upon a time, she was, in fact,
11
regularly providing services to State Street
12
Consultants and its clients, correct?
13
A.
She was doing that at that time.
14
Q.
Okay.
15
ago, right?
16
A.
I don't know.
17
Q.
Well, from where you sit, it is no
18
longer apparent that she is regularly performing
19
services for State Street Consultants or its
20
employees, correct?
21
A.
I don't see her in the office much.
22
Q.
But you know she's still getting a
23
paycheck, right?
24
A.
Yes.
But that period ended some time
Thomas Rankin
January 5, 2009
176 1
Q.
Does that concern you or trouble you?
2
A.
If she's not performing services, that
3
would be.
4
Q.
5
that?
6
A.
Yes.
7
Q.
What did you say to him about that?
8
A.
That employees need to provide
9
services.
Have you talked with Mr. Clark about
10
Q.
When did you have that conversation?
11
A.
I don't recall.
12
Q.
Was it within the past six months?
13
A.
Possibly.
14
Q.
Probably?
15
A.
Maybe.
16
Q.
Do you have any way of pinning down how
17
recently you had that discussion with Mr. Clark?
18
A.
19
that conversation was.
20
Q.
21
frame when you stopped seeing Ms. Lora in the
22
office regularly?
23
A.
24
stopped seeing her in the office.
I really don't remember exactly when
Can you tell me the approximate time
I don't remember specifically when I
Thomas Rankin
January 5, 2009
177 1
Q.
2
not?
3
A.
Possibly, yes.
4
Q.
Okay.
5
up with Mr. Clark and said, you know, if she's not
6
working here, she shouldn't be getting a paycheck,
7
how did he react to that?
8
A.
I'm sure he took it under advisement.
9
Q.
Did he say anything in response?
10
A.
Not that I recall.
11
Q.
Did he say he would get back to you?
12
A.
No.
13
Q.
Did he tell you to butt out and mind
14
your own business?
15
A.
I don't recall that.
16
Q.
Did he seem to appreciate you bringing
17
the topic up with him?
18
A.
Yes.
19
Q.
Now, you've said that he took it under
20
advisement.
21
communicated to you that he took it under
22
advisement?
23
A.
"I'll take that under advisement."
24
Q.
That's what he said?
It's been quite some time now, has it
Now, when you took that subject
What was it that he said or did that
Thomas Rankin
January 5, 2009
178 1
A.
Yes.
2
Q.
Okay.
3
get back to you after he had considered it
4
further?
5
A.
No.
6
Q.
He hasn't gotten back to you, right?
7
A.
No.
8
Q.
I threw a couple words in there that
9
confused the question.
Did he tell you that he would
It is true, is it not,
10
that he hasn't gotten back to you?
11
A.
Yes.
12
Q.
And she's still on the payroll,
13
correct?
14
A.
As far as I know.
15
Q.
Have you gone back to Mr. Clark and
16
said, Mr. Clark, or, Neil, you took this under
17
advisement, have you reached a conclusion yet?
18
A.
No.
19
Q.
Have you talked with anyone else about
20
that state of affairs?
21
A.
22
I don't think so. MR. WEAVER:
Objection.
Can we make
23
sure that the questions about who he talked to
24
does not include either his spouse or his
Thomas Rankin
January 5, 2009
179 1
attorney, nonprivileged conversations?
2
MR. CVETANOVICH:
3
MR. WEAVER:
4
MR. CVETANOVICH:
I will do that.
Thank you. Yes.
I'll work
5
around that, Mark.
6
Q.
7
in any lobbying services outside of State Street
8
Consultants or NSC Consulting Corp.?
9
A.
Not that I'm aware of.
10
Q.
Do you know whether Mr. Clark has
11
created a new entity through which he is doing or
12
plans to do lobbying work?
13
A.
Not that I'm aware of.
14
Q.
Has he told you that he has a plan of
15
doing that?
16
A.
A plan of doing -- can you repeat that?
17
Q.
Yes.
18
activities other than through an entity other than
19
State Street Consultants and NSC Consulting Corp.?
20
A.
Possibly.
21
Q.
When did he tell you that?
22
A.
Within the past 30 days.
23
Q.
Did he tell you when he hoped that new
24
entity would be operational?
Do you know whether Mr. Clark engages
A plan of conducting lobbying
Thomas Rankin
January 5, 2009
180 1
A.
2
operational, not that I recall.
3
Q.
4
doing business through the new entity?
5
A.
No.
6
Q.
Did he tell you whether he planned to
7
take or try to take clients of State Street
8
Consultants over to his new entity?
9
A.
No.
10
Q.
Did he tell you that he planned to take
11
or to try to take clients of NSC Consulting Corp.
12
over to the new entity?
13
A.
No.
14
Q.
Mr. Clark tell you that he planned to
15
invite employees of State Street Consultants to
16
join him in the new entity?
17
A.
Can you repeat that?
18
Q.
Certainly.
19
A.
Okay.
20
Q.
Did Mr. Clark tell you that he planned
21
to invite employees of State Street Consultants to
22
join him in the new entity?
23
A.
Yes.
24
Q.
Did he tell you which employees?
When the new entity would be
Did he tell you when he hoped to start
Thank you.
Thomas Rankin
January 5, 2009
181 1
A.
Yes.
2
Q.
Which ones?
3
A.
Aaron Ockerman, Andrew Minton, John
4
Singleton, and I think that's all.
5
Q.
6
extend that invitation to them?
7
A.
No.
8
Q.
To your knowledge, has he done so yet?
9
A.
Yes.
10
Q.
Has he invited each of them to leave
11
State Street Consultants and join his new entity?
12
A.
A new entity.
13
Q.
Has he invited all of them to leave and
14
join a new entity?
15
A.
I don't recall.
16
Q.
Which ones has he invited to leave
17
State Street Consultants and join a new entity?
18
A.
19
Singleton.
20
Q.
Can you think of any others?
21
A.
No.
22
Q.
Do you know if Aaron Ockerman has yet
23
responded to Mr. Clark's invitation to join a new
24
entity?
Did he tell you when he planned to
No.
Aaron Ockerman, Andrew Minton, John
Thomas Rankin
January 5, 2009
182 1
A.
Not that I'm aware of.
2
Q.
Do you know if Andrew Minton has yet
3
responded to Mr. Clark's invitation to join a new
4
entity?
5
A.
Not that I'm aware of.
6
Q.
Do you know if John Singleton has yet
7
responded to Mr. Clark's invitation to join a new
8
entity?
9
A.
Not that I'm aware of.
10
Q.
Do you know if Mr. Clark has invited
11
anyone other than those three persons to join him
12
in a new entity that will provide lobbying
13
services?
14
A.
15
Jones.
16
Q.
17
have yet given Mr. Clark a response to his
18
invitation to join a new entity?
19
Lisa Rankin.
Jane Harrison.
Elizabeth
That's all I remember. Do you know if any of those persons
MR. WEAVER:
Objection.
I want to
20
instruct the witness to not provide any answers
21
that are gained from conversations within the
22
spousal privilege.
23
MR. CVETANOVICH:
24
MR. WEAVER:
Fair enough.
Thank you.
Thomas Rankin
January 5, 2009
183 1
You may answer as long as you're not
2
discussing any information you gained within
3
conversations between you and your spouse.
4
A.
What was the question again?
5
Q.
The question is:
6
those persons have yet given Mr. Clark a response
7
to his invitation to join a new entity?
8
persons, this may help you, were Lisa Rankin, Jane
9
Harrison, Elizabeth Jones.
10 11
MR. CVETANOVICH: untranslatable here. MR. WEAVER:
13
MR. CVETANOVICH:
15
And those
I have an
Is that all of them?
12
14
Do you know if any of
May I make a suggestion? You may, but then we
have to read his question over again, you realize. MR. WEAVER:
If you could ask the
16
question first with Lisa, and then ask the
17
question again without Lisa?
18
MR. CVETANOVICH:
19
MR. WEAVER:
20
That allows him to pay
attention to the spousal privilege for the one.
21
MR. CVETANOVICH:
22
MR. WEAVER:
23 24
Sure.
Sure.
And not necessarily pay
attention to the spousal privilege -MR. CVETANOVICH:
I'm happy to do it
Thomas Rankin
January 5, 2009
184 1
that way.
2
Q.
3
responded to Mr. Clark's invitation from any
4
informational source other than having heard it
5
from Lisa herself, tell me.
6
A.
No.
7
Q.
All right.
8
side and stick with the other persons on the list.
9
Now I've got to find the list again.
If you know whether Lisa Rankin has yet
Now, let's set Lisa to one
Jane
10
Harrison and Elizabeth Jones.
11
either of those persons has yet responded to
12
Mr. Clark's invitation to join them in a new
13
lobbying entity?
14
A.
No.
15
Q.
Do you know whether Mr. Clark has a
16
target date for these folks to join him in a new
17
entity?
18
A.
I don't know if there's a target date.
19
Q.
Has Mr. Clark invited your company,
20
Thomas A. Rankin & Associates, to provide
21
accounting services to the new entity that he's
22
creating?
23
A.
24
doing accounting services.
Do you know if
He's -- no one has approached me about
Thomas Rankin
January 5, 2009
185 1
Q.
2
did you take it as implicit that he wants you to
3
continue to be the accountant for his company?
4
A.
For a company, yes.
5
Q.
I take it you would be happy to do
6
that?
7
A.
Another client?
8
Q.
Yes.
9
A.
Yes.
10
Q.
Do you know how much Mr. Clark has
11
received in distributions from State Street
12
Consultants in 2008?
13
A.
I don't recall exactly.
14
Q.
Do you have a range in your mind?
15
A.
Yes.
16
Q.
What's the range?
17
A.
500 to -- well, let me take that back.
18
400 to 600,000.
19
Q.
20
distributions from State Street Consultants in
21
2007?
22
A.
I don't recall that.
23
Q.
Do you have a range?
24
A.
500 to 700,000.
From your conversation with Mr. Clark,
And how much did he receive in
Thomas Rankin
January 5, 2009
186 1
Q.
How about 2006?
2
A.
600 to 800,000.
3
Q.
Now let's switch over from State Street
4
Consultants to NSC Consulting Corp.
5
A.
Uh-huh.
6
Q.
Do you know how much Mr. Clark has
7
received in distributions from NSC Consulting
8
Corp. in 2008?
9
A.
Not exactly.
10
Q.
Do you have a range in your mind?
11
A.
250 to 350,000.
12
Q.
Do you know how much Mr. Clark received
13
in distributions from NSC Consulting Corp. in
14
2007?
15
A.
300 to 400,000.
16
Q.
Can you tell us how much Mr. Clark
17
received in distributions from NSC Consulting
18
Corp. in 2006?
19
A.
Not exactly.
20
Q.
Do you have a range in your mind?
21
A.
350 to 400,000.
22
Q.
In the past three years, has any
23
portion of NSC's -- let me say NSC Consulting
24
Corp.'s revenues been paid to State Street
Thomas Rankin
January 5, 2009
187 1
Consultants?
2
A.
Not that I recall.
3
Q.
During the past three years, have any
4
portion of NSC Consulting Corp.'s revenues been
5
paid to Paul Tipps?
6
A.
Not that I recall.
7
Q.
Do you know if State Street Consultants
8
gave State Street Partners notice of termination
9
of the lease on the 137 East State Street
10
premises?
11
A.
I heard that they did.
12
Q.
From whom did you hear that?
13
A.
Neil Clark.
14
Q.
When did you hear that from Mr. Clark?
15
A.
December 1st.
16
Q.
Did you ever see the notice?
17
A.
Not that I recall.
18
Q.
Did Mr. Clark ever discuss with you why
19
State Street Consultants would be moving its
20
offices from 137 East State Street?
21
A.
Yes.
22
Q.
What did he tell you?
23
A.
The cost of the offices, the office, at
24
137 East State Street was too high.
Thomas Rankin
January 5, 2009
188 1
Q.
2
that your understanding?
3
A.
Yes.
4
Q.
Do you know of anything that Mr. Clark
5
or anyone else has done on behalf of State Street
6
Partners to find replacement tenants for 137 East
7
State Street?
8
A.
Yes.
9
Q.
Tell us what you know about that.
10
A.
There have been advertisements in
11
papers, local newspapers.
12
contract.
13
or whatever -- has been hired to assist in finding
14
a tenant for selling the building on several
15
occasions.
16
Q.
Anything else?
17
A.
Go back to the question, please, again.
18
Q.
Yes.
19
anything that Mr. Clark or anyone else has done on
20
behalf of State Street Partners to find
21
replacement tenants for 137 East State Street?
22
A.
Yes.
23
Q.
Well, you did say "yes," and you did
24
give me two examples.
So he went to find cheaper space; is
Realtor has been under
I don't know if they go under contract
The question was:
Do you know of
I think I answered that.
Yes.
Thomas Rankin
January 5, 2009
189 1
A.
Right.
2
Q.
Is there anything else?
3
A.
There could be more examples.
4
recall.
5
Q.
6
newspaper advertisements have run?
7
A.
I don't.
8
Q.
Do you know if it's been within the
9
past six months?
I don't
Do you know during what time frame the
10
A.
I don't know.
11
Q.
Are those of which you're aware ones
12
that have run within the past six months?
13
A.
14
printed.
15
Q.
16
engaged to seek tenants for the building.
17
A.
Uh-huh.
18
Q.
Do you know what realtor was engaged?
19
A.
Currently Sam Kuhn of -- an Eric George
20
of Calgary Realty.
21
Q.
Do you know when they were engaged?
22
A.
Six months ago, possibly.
23
Q.
Do you know if they've brought any
24
prospective tenants through the building in the
I don't know when those would have been
You also said that a realtor had been
Thomas Rankin
January 5, 2009
190 1
past 60 days?
2
A.
Sixty days.
3
Q.
Do you know how recently they have
4
brought a prospective tenant into the building?
5
A.
I don't.
6
Q.
Do you know whether Mr. Clark has
7
discouraged any current tenants in the building
8
from remaining as tenants in the building?
9
A.
I don't know of that.
10
Q.
Do you know of any subtenants that
11
occupy space in the building?
12
A.
13
please.
14
Q.
15
building that occupies not pursuant to a direct
16
lease with the owner, but instead pursuant to a
17
lease with another tenant.
18
sublease.
19
A.
Not that I'm aware of.
20
Q.
Do you know the current maturity date
21
of the mortgage on 137 East State Street?
22
A.
Probably not the exact date.
23
Q.
Do you know that it's coming up in --
24
this month?
I think so.
Can you define "subtenant" for me,
Yes.
It would be a tenant in the
And we call that a
Thomas Rankin
January 5, 2009
191 1
A.
Yes.
2
Q.
Do you know if State Street Partners
3
has the ability to pay off the mortgage when it
4
comes due this month?
5
A.
It does not as far as I'm aware.
6
Q.
If State Street Partners cannot pay off
7
the mortgage when it comes due later this month
8
and Fifth Third Bank calls the guaranty of State
9
Street Consultants, will it have the financial
10
capacity to make good on its guaranty?
11
A.
No, not that I am aware of.
12
Q.
If Fifth Third Bank then goes to
13
Mr. Clark and calls his guaranty of the repayment
14
of that mortgage loan, will he have the capacity
15
to make good on the guaranty?
16
A.
Not that I'm aware of.
17
Q.
At this point in time, he has a
18
negative net worth, does he not?
19
A.
20
time what his net worth might be.
21
Q.
22
his net worth, it was negative, correct?
23
A.
24
yes.
I don't know at this exact point in
When you were most recently aware of
I don't recall, but I would presume,
Thomas Rankin
January 5, 2009
192 1
Q.
2
correct?
3
A.
Yes.
4
Q.
Did you see a newspaper article in The
5
Columbus Dispatch, oh, I don't know, near the end
6
of November, early December, in which Mr. Clark
7
was extensively quoted about his financial affairs
8
and circumstances?
9
A.
I did see the article.
10
Q.
I think he said in that that he had a
11
negative net worth, didn't he?
12
A.
I don't recall.
13
Q.
Are you aware of any assets of NSC
14
Consulting Corp. having been transferred to State
15
Street Consultants?
16
A.
Not that I'm aware of.
17
Q.
We talked a little while ago about
18
Mr. Clark receiving in-kind compensation or
19
remuneration from State Street Consultants and/or
20
NSC Consulting Corp., and I want to revisit that
21
for just a minute.
22
that.
23
several different kinds of insurance.
24
And that's been fairly recently,
You gave me some examples of
We talked about insurance premiums for
Is there anything else of value apart
Thomas Rankin
January 5, 2009
193 1
from the distributions that Mr. Clark has received
2
from State Street Consultants or NSC Consulting
3
Corp. and these payments that either of those
4
entities have made of his insurance premiums that
5
Mr. Clark has received from either of those
6
entities in the last three years?
7
A.
Not that I can think of right now.
8
Q.
To your knowledge, have either of those
9
entities made house payments for Mr. Clark on
10
either of his residences?
11
A.
I don't recall if they did.
12
Q.
Have either of those entities paid
13
other bills of Mr. Clark?
14
A.
I don't know.
15
Q.
Have either of those entities provided
16
him an automobile?
17
A.
18
from 2006 forward on an automobile.
19
recall.
20
Q.
21
NSC Consulting Group paid for any nonbusiness
22
travel for Mr. Clark?
23
A.
I don't know.
24
Q.
Have either of those entities paid for
I don't pay the bills.
I don't recall if NSC made any payments I don't
Has either State Street Consultants or
Thomas Rankin
January 5, 2009
194 1
any of Mr. Clark's family members or for his
2
girlfriend or other friends to accompany him on
3
any trips?
4
A.
5
I don't know.
6
Q.
Who would know all of that?
7
A.
Mr. Clark.
8
Q.
Who at SSC, what other employees, would
9
know about that?
I don't make his travel arrangements.
10
A.
11
that or not.
12
Q.
13
Street Consultants, who you would expect to know
14
that, if anyone does?
15
A.
16
anyone does.
17
Q.
18
talking about other employees of State Street
19
Consultants.
20
A.
Possibly.
21
Q.
Based upon her position within the
22
company and the access she has, if anyone would
23
know about it, she would know it, correct?
24
A.
I don't know if Ms. Harrison would know
Is she the person at SSC, or State
I would expect Mr. Clark to know it, if
Well, I understand that, but I'm
Yes.
Thomas Rankin
January 5, 2009
195 1
Q.
2
right, or transferring the moneys?
3
A.
Yes.
4
Q.
Have you ever read the pledge agreement
5
executed by Mr. Clark?
6
Because she'd be writing the checks,
MR. GONZALEZ:
Objection.
7
Q.
You may respond.
8
A.
I'm sure I have.
9
Q.
I may have misspoken.
That pledge
10
agreement I think was executed by State Street
11
Consultants and NSC Consulting Group.
12
revision on my part, have you read that?
13
A.
I'm sure I have.
14
Q.
Are you familiar with the terms of it?
15
A.
No.
16
Q.
Have you read the cross purchase
17
agreement among Mr. Clark, Mr. Tipps, State Street
18
Partners, State Street Consultants, NSC Consulting
19
Corp., and Public Policy Consultants?
20
A.
Yes.
21
Q.
Are you conversant with the terms of
22
that?
23
A.
No.
24
Q.
Meaning if I ask you questions about
With that
Conversant --
Thomas Rankin
January 5, 2009
196 1
it, you can talk with me about it?
2
A.
I might.
3
Q.
Okay.
4
A.
I don't have it memorized.
5
know to what extent you would expect conversant to
6
be.
7
Q.
8
competing with State Street Consultants?
9
A.
No.
10
Q.
No, you don't know?
11
A.
No, I don't know.
Do you know if NSC Consulting Corp. is
12
MR. WEAVER:
13
MR. CVETANOVICH:
14
THE VIDEOGRAPHER:
15
I didn't
Water break here? Yes.
That's fine.
We are off the
record at 1615.
16
(A brief recess is taken.)
17
THE VIDEOGRAPHER:
We are back on the
18
record at 1625.
19
Q.
20
entity known as Midwest Communications?
21
A.
Yes.
22
Q.
What do you understand it to be?
23
A.
A media services firm.
24
Q.
Do you know where its headquarters is
Mr. Rankin, are you familiar with an
Thomas Rankin
January 5, 2009
197 1
located?
2
A.
49 Grant Street.
3
Q.
Is that the same location into which
4
you understand that some of the lobbyists for
5
State Street Consultants will be relocating their
6
operations?
7
A.
Yes.
8
Q.
Do you know if Midwest Communications
9
owns the building?
10
A.
They do not.
11
Q.
Do you know who owns the building?
12
A.
A separate entity.
13
Q.
What's the name of the entity?
14
A.
Russell Clegg or Clegg Russell, LLC.
15
Q.
Do you know who any of the principals
16
are of that entity?
17
A.
Yes.
18
Q.
Who are they?
19
A.
Mary Russell and Robert Clegg.
20
Q.
Do you know someone named Patty
21
Russell?
22
A.
I do.
23
Q.
Does Patty Russell have an ownership
24
interest in Midwest Communications?
Thomas Rankin
January 5, 2009
198 1
A.
Yes.
2
Q.
Is it Mary --
3
A.
Patty -- Mary Patricia Russell.
4
formal name is Mary Russell.
5
Q.
Thank you.
6
A.
From what I know.
7
Q.
Okay.
8
Clark has an interest in that entity?
9
A.
He does not.
10
Q.
Do you know if he has an interest in
11
the building?
12
A.
He does not.
13
Q.
Do you know if Mr. Clark has provided
14
any financing to Midwest Communications?
15
A.
I don't know.
16
Q.
Do you know of any relationship
17
whatsoever between Mr. Clark and Midwest
18
Communications?
19
A.
Yes.
20
Q.
What is the relationship?
21
A.
Mr. Clark is an owner of Midwest
22
Communications.
23
Q.
24
last couple of minutes, Mr. Rankin, either I
That's Mary Russell.
Thank you.
Her
Do you know if Neil
Somewhere along the line here in the
Thomas Rankin
January 5, 2009
199 1
confused you or you confused me.
2
to try to find out which it is, and then we'll --
3
whoever it is, we'll get it straightened out here.
4
A.
Okay.
5
Q.
This entity, Midwest Communications,
6
you said it's Midwest Communications, LLC?
7
A.
No.
8
Q.
What is the full name of it, as best
9
you understand it?
Let me endeavor
10
A.
11
Midwest Communications & Media.
12
Q.
13
is?
14
A.
A general partnership.
15
Q.
Do you know who are the general
16
partners?
17
A.
Mary Patty Russell and Neil Clark.
18
Q.
Do you know for how long Mr. Clark has
19
been a general partner in Midwest Communications?
20
A.
I don't know how long.
21
Q.
Do you know what his percentage of
22
ownership interest is in that partnership?
23
A.
Fifty percent, as far as I know.
24
Q.
To your knowledge, are there any
Midwest Communications & Media. Yeah.
Do you know what nature of entity it
Thomas Rankin
January 5, 2009
200 1
contractual relationships between State Street
2
Consultants and Midwest Communications?
3
A.
Not that I'm aware of.
4
Q.
Apart from Mr. Clark being one of the
5
partners in Midwest Communications, are you aware
6
of any contractual relationships between Mr. Clark
7
and Midwest Communications?
8
A.
Not that I'm aware of.
9
Q.
Are you aware of any contractual
10
relationships between Mr. Clark and Mary Patty
11
Russell other than their partnership agreement for
12
Midwest Communications?
13
A.
Not that I'm aware of.
14
Q.
Could you repeat for me the name of the
15
entity that owns the building at 49 South Grant?
16
You said it's Clegg Russell, LLC?
17
A.
18
don't know which name is first.
19
which name is first.
20
Q.
21
you again.
Russell Clegg or Clegg Russell, LLC.
Thank you.
I don't recall
I
I just found it as I asked
22
To your knowledge, Mr. Clark has no
23
ownership interest in Clegg Russell or Russell
24
Clegg, correct?
Thomas Rankin
January 5, 2009
201 1
A.
To my knowledge, that's correct.
2
Q.
To your knowledge, does anyone other
3
than Mary Patty Russell or Mr. Clegg have an
4
interest in Clegg Russell or Russell Clegg?
5
A.
Not that I'm aware of.
6
Q.
Do you know how long Midwest
7
Communications has been in existence?
8
A.
I don't.
9
Q.
Do you know if it's been in existence
10
at least five years?
11
A.
Yes.
12
Q.
Has it been?
13
A.
Yes.
14
Q.
To your knowledge, has it been in the
15
same business for at least the past five years?
16
A.
It has.
17
Q.
Has its offices been in the same
18
location for at least the last five years?
19
A.
I don't think so.
20
Q.
Do you know when the offices of Midwest
21
Communications were relocated to 49 South Grant
22
Street?
23
A.
I don't know the specific date or year.
24
Q.
Excuse me.
Do you know how long Patty
Thomas Rankin
January 5, 2009
202 1
Russell has been a principal of Midwest
2
Communications?
3
A.
I don't.
4
Q.
Do you know if there are any partners
5
in Midwest Communications apart from Patty Russell
6
and Neil Clark?
7
A.
Not that I'm aware of.
8
Q.
Do you know if there have ever been?
9
A.
I don't know if that's the fact.
10
Q.
Do you know if Neil Clark provides any
11
manner of services to Midwest Communications?
12
A.
Yes.
13
Q.
What manner of services?
14
A.
Consulting, as an owner.
15
Q.
Do you know if Mr. Clark receives
16
compensation from Midwest Communications for the
17
services he provides it?
18
A.
19
Mr. Clark receives.
20
Q.
21
other form of compensation from Midwest
22
Communications?
23
A.
No.
24
Q.
Do you know for how long Mr. Clark has
Distribution of profits is what
Apart from that, does he receive any
Not that I'm aware of.
Thomas Rankin
January 5, 2009
203 1
been receiving distributions of profits from
2
Midwest Communications?
3
A.
I don't know specifically how long.
4
Q.
What is the earliest point of which
5
you're aware when Mr. Clark received a partnership
6
distribution from Midwest Communications?
7
A.
1994.
8
Q.
To your knowledge, do Midwest
9
Communications and State Street Consultants share
10
any clients or have any clients in common?
11
A.
Yes.
12
Q.
Can you name those clients?
13
A.
I can name two.
14
Q.
Would you do that, please.
15
A.
Or former clients.
16
former clients?
17
Q.
18
and then after each just indicate whether it's
19
former or current.
20
A.
21
both.
22
Q.
23
former clients that State Street Consultants and
24
Midwest Communications have or have had in common?
Current clients,
Why don't we have you identify both,
Vote Yes on Issue 3, former client for Vote No on Issue 5, former client for both. Are there any other either current or
Thomas Rankin
January 5, 2009
204 1
A.
Not that I can remember.
2
Q.
Do you know of any clients that Midwest
3
Communications and NSC Consulting Corp. have in
4
common or have had in common?
5
A.
Not that I'm aware of.
6
Q.
Do you know of any clients that Midwest
7
Communications has referred to State Street
8
Consultants?
9
A.
I don't know.
10
Q.
Do you know of any clients that State
11
Street Consultants has referred to Midwest
12
Communications?
13
A.
14
Consultants referring business to Midwest.
15
Q.
16
revenue-sharing agreements that exist or have
17
existed between State Street Consultants and
18
Midwest Communications?
19
A.
Not that I'm aware of.
20
Q.
Do you have any knowledge of any
21
expense sharing agreements that exist or have
22
existed between State Street Consultants and
23
Midwest Communications?
24
A.
I don't have knowledge of State Street
Do you have knowledge of any
Not that I'm aware of.
Thomas Rankin
January 5, 2009
205 1
Q.
2
Mr. Rankin, that some of the State Street
3
Consultants' lobbyists who are vacating 137 East
4
State Street will be occupying space in 49 South
5
Grant.
6
existence that will permit that to occur?
7
A.
Not that I know of.
8
Q.
Do you know whether there is a lease
9
that will be signed to permit that to occur?
You told me earlier in our proceeding,
Do you know whether there is a lease in
10
A.
Not that I know of.
11
Q.
Do you know what arrangements exist
12
that will permit some of State Street Consultants'
13
lobbyists to occupy space at 49 South Grant
14
Street?
15
A.
Do I know of -- I'm sorry?
16
Q.
Do you know what arrangements exist
17
that will permit some of State Street Consultants
18
consultants lobbyists to occupy space at 49 South
19
Grant Street?
20
A.
I could only presume a rent payment.
21
Q.
Do you know who the tenant will be
22
under that arrangement?
23
A.
24
Consultants.
I would presume State Street
Thomas Rankin
January 5, 2009
206 1
Q.
2
this new entity that Mr. Clark has spoken with you
3
about that will be paying the rent on 49 South
4
Grant?
5
A.
Do you know whether instead it will be
Not that I'm aware of.
6
- - - - -
7 8
Thereupon, Plaintiffs' Exhibit 4 is marked for purposes of identification.
9
- - - - -
10
Q.
11
document that's been marked Plaintiffs' Exhibit 4.
12
I'll ask you to take a moment and look at that,
13
please.
14
Mr. Rankin, I want to hand you now a
Had a chance to look that over, sir?
15
A.
Yes.
16
Q.
Have you seen reports like this before?
17
A.
Yes.
18
Q.
This says on its face, top of the very
19
first page, that it is a State Street Consultants
20
12 Month Cash-Flow Report, Year 2006.
21
that?
22
A.
I do.
23
Q.
And then up in the upper right-hand
24
corner of the first page and indeed each of the
Do you see
Thomas Rankin
January 5, 2009
207 1
pages of the exhibit we see a date, November 21st,
2
2007.
3
A.
I do.
4
Q.
Do you recognize that as the run date
5
of the report?
6
A.
Yes.
7
Q.
These are the kind of cash flow reports
8
which you told me earlier are sometimes produced
9
by Ms. Harrison, correct?
Do you see where I'm referring?
10
A.
Yes.
11
Q.
And these are reports the likes of
12
which you have seen in the past while providing
13
services for State Street Consultants, correct?
14
A.
Yes.
15
Q.
You understand how to read this report?
16
A.
Sure.
17
Q.
Let me ask you just a few questions
18
about it then.
19
column, we have a heading, Sources of Cash.
20
you see that?
21
A.
I do.
22
Q.
And then Business Income, and then
23
beneath that, we have a whole listing of things,
24
some of which are entities, some of which are
On the first page there, left-hand Do
Thomas Rankin
January 5, 2009
208 1
other than entities.
2
business income to State Street Consultants; is
3
that correct?
4
A.
Not all of them.
5
Q.
Some of them are, correct?
6
A.
That's correct.
7
Q.
All of them on the first page are,
8
correct?
9
A.
Yes.
10
Q.
And all of them on the second page are,
11
down to Vitas, V-I-T-A-S, which is about two and a
12
half inches from the bottom of the page, correct?
13
A.
That's right.
14
Q.
And then we have a series of items
15
listed that are something other than sources of
16
income, right?
17
A.
That's correct.
18
Q.
But they are sources of cash, correct?
19
A.
Yes.
20
Q.
For example, there is a line item there
21
very near the bottom that says, "Loan from Tom
22
Rankin."
23
A.
I do.
24
Q.
Do you recall having loaned money to
Those are sources of
Do you see that one?
Thomas Rankin
January 5, 2009
209 1
State Street Consultants?
2
A.
I think my entity has.
3
Q.
Your entity being Thomas A. Rankin &
4
Associates?
5
A.
And Company.
6
Q.
And Company.
7
A.
That's all right.
8
Q.
How many time has your entity loaned
9
money to State Street Consultants?
Excuse me.
10
A.
Looks like one time here.
11
Q.
One time in 2006 at least?
12
A.
Yes.
13
Q.
Correct?
14
your entity loaned money to State Street
15
Consultants?
16
A.
I don't recall exactly.
17
Q.
Why has your entity loaned money to
18
State Street Consultants?
19
A.
20
some money.
21
Q.
22
requested that your entity make a loan to State
23
Street Consultants?
24
A.
How many times overall has
Because State Street Consultants needed
When that has happened, who has
Mr. Clark.
Thomas Rankin
January 5, 2009
210 1
Q.
2
said yes?
3
A.
No.
4
Q.
How many times have you said no?
5
A.
Some.
6
Q.
How many?
7
A.
I don't know exactly how many.
8
Q.
What's your best approximation?
9
A.
Five.
10
Q.
When you've said no to a request from
11
Mr. Clark -- I should say a request by Mr. Clark
12
for a loan from your entity to State Street
13
Consultants, why have you said no?
14
A.
I may not have had the money.
15
Q.
Do you remember that as the reason
16
every time you said no?
17
THE WITNESS:
Spousal things.
18
MR. WEAVER:
There's a question
When that has happened, have you always
19
pending, I may need to confer with my client with
20
respect to the spousal privilege.
21
MR. CVETANOVICH:
22
MR. WEAVER:
23
MR. CVETANOVICH:
24
THE VIDEOGRAPHER:
That's fine.
May we do it? Sure.
Of course.
We are off the
Thomas Rankin
January 5, 2009
211 1
record at 1644.
2
(A brief recess is taken.)
3
THE VIDEOGRAPHER:
4
We are back on the
record at 1647.
5
MR. CVETANOVICH:
Mark, I can read
6
questions and answers up to the point where we
7
broke, if you want me to, or I can just attack
8
this differently.
9
MR. WEAVER:
Let me just state on the
10
record that thank you for allowing the courtesy of
11
me to confer with my client wherein I explained
12
more fully the boundaries of attorney-client
13
privilege and spousal privilege, and that my
14
client is ready to answer your questions however
15
you see fit to ask them.
16
MR. CVETANOVICH:
Great.
Thank you
17
very much.
18
Q.
19
Mr. Rankin, had to do with instances when
20
Mr. Clark requested that your company make a loan
21
to State Street Consultants, but in which you said
22
no, that your company would not make such a loan.
23
You told me that that happened perhaps five times,
24
not holding you to that specific number.
The line of questioning we were on,
And I
Thomas Rankin
January 5, 2009
212 1
had asked you when you said no, what was the
2
reason that you said no, and you told me that
3
perhaps you didn't have the money.
4
asked you, well, was that the reason every time.
5
And let me just sort of put that back on the
6
table.
7
And then I had
In those instances where you declined
8
Mr. Clark's request for your company to loan State
9
Street Consultants money, was it always because
10
your company didn't have the money to spare?
11
A.
12
with my spouse or my attorney, the reasons that I
13
did not -- said no was I did not have cash.
14
Q.
15
you thought State Street Consultants wasn't a good
16
credit risk?
17
A.
No.
18
Q.
Did you ever say no because you were
19
getting sick and tired of Mr. Clark coming and
20
asking your company to loan his company money?
21
A.
22
with my spouse or my attorney, no.
23
Q.
24
Other than discussions I may have had
All right.
Did you ever say no because
Other than discussions I may have had
Okay. THE WITNESS:
Is that all right?
Thomas Rankin
January 5, 2009
213 1
MR. WEAVER:
2
you believe.
3
believe.
4
You may always answer what
That's not privileged, what you
THE WITNESS:
Okay.
5
Q.
6
looking at together there, Mr. Rankin, "Loan from
7
Tom Rankin," do you see it there near the bottom
8
of page 2 on Exhibit 4?
9
A.
Yes.
10
Q.
Just above that, there's a line item
11
that says, "Loan from NSC."
12
A.
Yes.
13
Q.
Do you have any knowledge or
14
information about NSC having made loans to State
15
Street Consultants in the year 2006?
16
A.
17
that I have to substantiate that.
18
Q.
19
the layout of this report, this section that we're
20
looking at together is the "sources of cash"
21
section, correct?
22
A.
Yes.
23
Q.
And that's where one would expect to
24
see amounts flowing into State Street Consultants,
Just above the line item we've been
Do you see that?
I do.
I would have to refer to NSC records
Just looking at the -- what I'll call
Thomas Rankin
January 5, 2009
214 1
whether it's from the proceeds of a loan or
2
otherwise, correct?
3
A.
Yes.
4
Q.
This report, the line item we're
5
looking at together, would suggest that there were
6
moneys flowing into State Street Consultants via a
7
loan or loans from NSC in several different months
8
of the year 2006, correct?
9
A.
Yes.
10
Q.
Specifically February, April, July,
11
September, October, and December, correct?
12
A.
Yes.
13
Q.
And the aggregate amount of those loans
14
being $62,800.
15
A.
Yes.
16
Q.
Do you have any recollection whatsoever
17
of NSC Consulting Corp. having been making loans
18
of those amounts of money to State Street
19
Consultants?
20
A.
Yes.
21
Q.
You do have that recollection.
22
that happening?
23
A.
24
needed the cash.
Do you see that?
Why was
I presume State Street Consultants
Thomas Rankin
January 5, 2009
215 1
Q.
2
ever repaid what's reflected here as these loan
3
amounts from NSC Consulting Corp.?
4
flipping over to the "uses of cash" section,
5
correct?
6
A.
I am.
7
Q.
All right.
8
A.
Yes.
9
Q.
Direct me, if you would, is that on
Do you know if State Street Consultants
You're
10
page 5?
11
A.
Yes.
12
Q.
Top line?
13
A.
Yes.
14
Q.
And it looks like over the course of a
15
year there were four repayments aggregating
16
$62,800, correct?
17
A.
Yes.
18
Q.
Do you know if these loans were ever
19
documented?
20
A.
Through books and records.
21
Q.
What do you mean by that?
22
entries?
23
A.
Yes.
24
Q.
Do you know if they were ever
Accounting
Thomas Rankin
January 5, 2009
216 1
documented by any kind of a loan agreement?
2
A.
Not that I'm aware of.
3
Q.
Do you know if they were ever
4
documented by promissory notes?
5
A.
Not that I'm aware of.
6
Q.
Do you know if State Street Consultants
7
ever gave NSC Consulting Corp. any security for
8
repayment of the loans?
9
A.
Not that I'm aware.
10
Q.
Do you know if there was ever a
11
resolution of State Street Consultants's passed
12
authorizing this borrowing from NSC Consulting
13
Corp.?
14
A.
Not that I'm aware of.
15
Q.
Do you know who made the determination
16
that State Street Consultants would borrow money
17
from NSC Consulting Corp.?
18
A.
Mr. Clark.
19
Q.
Do you know if there was interest paid
20
on the loans?
21
A.
Not that I'm aware of.
22
Q.
Do you know why NSC Consulting Corp.
23
was willing to loan moneys at no interest?
24
A.
I don't know why.
Thomas Rankin
January 5, 2009
217 1
Q.
2
practice, is it?
3
A.
It could be, I guess.
4
Q.
In your experience, it doesn't happen
5
much, does it, in the marketplace, people loan
6
money at no interest?
7
A.
Commonly-owned entities.
8
Q.
Are you saying this was not an
9
arm's-length transaction?
It's not a very common business
10
A.
No, I'm not saying that.
11
Q.
You think it was an arm's-length
12
transaction?
13
A.
14
commonly-owned entities.
15
Q.
16
to page 3 of Exhibit 4, and specifically the --
17
over in the left-hand column there's a category,
18
"unclassified income."
19
A.
I do.
20
Q.
And under that heading, "unclassified
21
income," there is a whole listing of clients.
22
you see that?
23
A.
I do.
24
Q.
Why are these clients here under this
I said I think it happens with
Let me direct your attention, please,
Do you see that?
Do
Thomas Rankin
January 5, 2009
218 1
heading, "unclassified income," and the income
2
derived from these clients characterized as
3
unclassified income rather than these clients
4
being back on the list on page 1, carrying over
5
onto page 2?
6
A.
7
it looks like to me is that those are clients that
8
are affiliated with Aronoff & Associates.
9
Q.
Why do you say that?
10
A.
Because those look like Aronoff &
11
Associates clients.
12
Q.
You just recognize them as such?
13
A.
I do.
14
Q.
There's nothing you see on this page 3
15
that indicates they're Aronoff clients, correct?
16
A.
That's correct.
17
Q.
Okay.
18
you would, to page 5.
19
the loan repayment to NSC, but I actually want you
20
to come down the page, if you would, please, to a
21
line item that's called "executive compensation."
22
Do you see that?
23
A.
Yes.
24
Q.
Does that refer to Mr. Clark's
Ms. Harrison prepared these.
And what
Let me ask you to flip over, if And we earlier looked at
Thomas Rankin
January 5, 2009
219 1
compensation?
2
A.
It refers to Mr. Clark's distribution.
3
Q.
Okay.
4
A.
Distributions.
5
Q.
Distributions are a form of
6
compensation, are they not?
7
A.
Yes.
8
Q.
It's compensation to an owner, right?
9
A.
Not all the time.
10
Q.
Okay.
11
though, right?
12
A.
It appears as though it was.
13
Q.
Let me ask you this question:
14
Mr. Clark, to your knowledge, receive
15
distributions of profits from Midwest
16
distribution -- excuse me -- Midwest Communication
17
in 2006 or for 2006?
18
A.
Yes.
19
Q.
In what amount?
20
A.
I don't know exactly.
21
Q.
What's the range?
22
A.
300 to 400,000.
23
Q.
Did Mr. Clark receive a distribution of
24
profits from Midwest Communications for 2007?
In this instance, it was,
Did
Thomas Rankin
January 5, 2009
220 1
A.
Not that I can recall.
2
Q.
Did Midwest Communications operate at a
3
loss for 2007?
4
A.
Yes.
5
Q.
Was a portion of the loss allocated to
6
Mr. Clark?
7
A.
Yes.
8
Q.
Do you know how great the loss was?
9
A.
I don't recall.
10
Q.
Do you know if Mr. Clark has received
11
distributions of profits from Midwest
12
Communications for 2008?
13
A.
Yes.
14
Q.
Do you know in what amount?
15
A.
I don't know exactly.
16
Q.
Do you have a range or an
17
approximation?
18
A.
19
- - - - -
20 21
300 to 400,000.
Thereupon, Plaintiffs' Exhibit 5 is marked for purposes of identification.
22
- - - - -
23
Q.
24
document that's been marked Plaintiffs' Exhibit 5.
Mr. Rankin, let me now hand you a
Thomas Rankin
January 5, 2009
221 1
If you would, please, take a moment and look at
2
that and then I'll have a few questions for you
3
about that.
4
A.
Okay.
5
Q.
Had an opportunity to look at that now,
6
Mr. Rankin?
7
A.
Yes, uh-huh.
8
Q.
Having done so, do you recognize it as
9
a State Street Consultants 12 Month Cash-Flow
10
Report for year 2007?
11
A.
Yes.
12
Q.
And the run date on this one is
13
November 14, 2007, correct?
14
A.
Yes.
15
Q.
Let me direct your attention, please,
16
to page 3 of this exhibit, Exhibit 5.
17
specifically to a category here that's labeled
18
"Unclassified Income SA/NSC."
19
A.
Yes.
20
Q.
And then beneath that heading we have a
21
whole listing of clients, do we not?
22
A.
Yes.
23
Q.
I want to focus your attention first on
24
the heading again, "Unclassified Income SA/NSC."
And
Do you see that?
Thomas Rankin
January 5, 2009
222 1
Is the SA reference to Stan Aronoff?
2
A.
I would presume it is.
3
Q.
And I take it the NSC reference is to
4
NSC Consulting Corp.?
5
A.
Yes.
6
Q.
Why is it that Mr. Aronoff's clients
7
would be listed under this unclassified income
8
heading on a cash flow report?
9
A.
I don't know why it would be put under
10
an unclassified category.
11
Q.
12
NSC Consulting Corp.
13
Consulting Corp. clients would show up on a cash
14
flow report for State Street Consultants?
15
A.
No.
16
Q.
It's the case, is it not, that on a
17
cash flow report for State Street Consultants the
18
only incoming cash that should show up is cash
19
that is available to State Street Consultants,
20
belongs to State Street Consultants, correct?
21
A.
Correct.
22
Q.
And on the "uses of cash" portion,
23
which we haven't gotten to yet, but the only uses
24
of cash that should show up would be uses of cash
Okay.
Let me ask the same question for Do you know why NSC
Thomas Rankin
January 5, 2009
223 1
to pay or satisfy obligations of State Street
2
Consultants, correct?
3
A.
Yes.
4
Q.
Staying here on page 3 and under the
5
same heading but down rather near the bottom we
6
have, I guess under American Cancer Society or
7
American Cancer, we see Cincinnati Schools,
8
Cincinnati Symphony, The Limited and then the
9
others on that page.
Do you see those?
10
A.
I do.
11
Q.
Do you recognize those as clients of
12
NSC Consulting Corp.?
13
A.
Yes.
14
Q.
Do you recognize the other clients in
15
that list but above Cincinnati Schools as having
16
been clients brought to State Street Consultants
17
by Stan Aronoff?
18
A.
Above American Cancer, yes.
19
Q.
Yes.
20
Okay.
There is zero cash flow for that
21
grouping of clients there beginning with
22
Cincinnati Schools, through the month of October,
23
correct?
24
A.
Yes.
Thomas Rankin
January 5, 2009
224 1
Q.
2
because this is a report that was generated on
3
November 14th, we don't have actual figures.
4
Instead we have only budgeted figures, correct?
5
A.
It appears correct.
6
Q.
Do you know why there would be budgeted
7
figures for November and December on a cash flow
8
report of State Street Consultants for clients of
9
NSC Consulting Corp.?
And then for November and December,
10
A.
Yes.
11
Q.
Why?
12
A.
To present the group as a whole.
13
Q.
What do you mean by "the group as a
14
whole"?
15
A.
I think we defined "group" earlier.
16
Q.
Well, we defined group as several of
17
your clients, and that was just for ease of
18
communication.
19
A.
Got you.
20
Q.
We can redefine group or do anything
21
you want --
22
A.
Nope.
23
Q.
-- but group as we defined it has no
24
applicability here.
Thomas Rankin
January 5, 2009
225 1
A.
Okay.
2
Q.
So what I'm trying to understand is why
3
this cash flow report would be presenting budgeted
4
income figures for clients not of State Street
5
Consultants, but of NSC Consulting Corp.
6
A.
7
see all the lobbying clients in one specific
8
report.
9
Q.
So I'm presuming I can -- so Neil can
Now, do you know that to be the reason
10
it was done this way, or you're speculating that's
11
a reason it could have been done this way?
12
A.
13
been -- I'm speculating it was done this way.
14
Q.
15
this way?
16
A.
17
presented in this fashion.
18
Q.
What makes you say that?
19
A.
Through -- I don't know specifically,
20
but I think I heard that.
21
Q.
From whom did you hear it?
22
A.
Neil Clark.
23
Q.
When did you hear it?
24
A.
I don't recall.
That's one reason why it may have
Do you know why it was actually done
I think Mr. Tipps requested it be
Maybe November of '07.
Thomas Rankin
January 5, 2009
226 1
Q.
2
propriety of putting together a cash flow report
3
like this for State Street Consultants?
4
A.
No.
5
Q.
Do you recall having provided anyone
6
any input into the determination of whether this
7
manner of presentation of a cash flow report for
8
State Street Consultants would be appropriate?
9
A.
Did anyone consult you about the
It was my client's opinion or decision
10
to do that.
11
Q.
Did you provide any input?
12
A.
I don't recall.
13
Q.
Do you know if cash flow reports such
14
as Exhibit 4 and Exhibit 5 which we've looked at
15
together were ever provided to Fifth Third Bank?
16
A.
I don't know if they were or not.
17
Q.
Who would know that?
18
A.
The bank.
19
Q.
Would anyone at State Street
20
Consultants know that?
21
A.
Possibly.
22
Q.
Do you know if -- well, let's come back
23
to possibly.
24
A.
Okay.
Thomas Rankin
January 5, 2009
227 1
Q.
Possibly who would know that?
2
A.
Ms. Harrison prepares the report.
3
Mr. Clark would, I would imagine, advise whether
4
to give it to the bank or not.
5
Q.
6
is there anyone else at State Street Consultants
7
who you would expect to know whether the cash flow
8
reports were provided to any of State Street
9
Consultants' banks?
Apart from Mr. Clark and Ms. Harrison,
10
A.
Not that I'm aware of.
11
Q.
Is there anyone at State Street
12
Consultants or State Street Partners who you would
13
expect to know -- and, again, other than Mr. Clark
14
and Ms. Harrison -- who you would expect to know
15
whether the cash flow reports were presented to
16
State Street Partners' banks?
17
A.
18
if I answered that question correctly.
19
Q.
Anyone else?
20
A.
Not that I'm aware of.
21
Q.
Do you know if either State Street
22
Consultants or State Street Partners maintains a
23
file containing duplicates of all of the financial
24
statements that have been submitted to their
Possibly Mr. Tipps, but -- I'm not sure
Thomas Rankin
January 5, 2009
228 1
banks?
2
A.
I don't know if they do or not.
3
Q.
Who at State Street Consultants would
4
you expect to know that?
5
A.
Mr. Clark.
6
Q.
Anyone else?
7
A.
Possibly Ms. Harrison.
8
Q.
Apart from those two, anyone else?
9
A.
Not that I would think.
10
Q.
At State Street Partners, would it be
11
the same list but perhaps add Mr. Tipps?
12
A.
Possibly.
13
Q.
I may have asked you this, Mr. Rankin.
14
If I did, I apologize, and you can just tell me
15
and we'll move on to something else.
16
Do you know what banks NSC Consulting
17
Corp. has a relationship with?
18
A.
Huntington Bank and Fifth Third Bank.
19
Q.
We did talk about that.
20
A.
We did.
21
Q.
Let me ask you to turn over to page 4,
22
if you would, still on Exhibit 5.
23
A.
Yes.
24
Q.
On this page, just a few inches from
Thank you.
Are you there?
Thomas Rankin
January 5, 2009
229 1
the top, we have a heading, "Uses of Cash."
2
you see that?
3
A.
Yes.
4
Q.
And then right under that a heading,
5
"business expenses."
6
A.
Yes.
7
Q.
And then a bunch of expense items are
8
listed.
9
A.
Yes.
10
Q.
If you get down, oh, about three items
11
from the bottom of that list, there is an item,
12
NSC Corp. expenses.
13
A.
I do.
14
Q.
There are no actual amounts in the
15
months of January through October, but there are
16
budgeted amounts for each of November and
17
December.
Do you see that?
18
A.
Yes.
19
Q.
Can you tell me why on a State Street
20
Consultants cash flow report there would be
21
budgeted amounts to cover not State Street
22
Consultants' expenses but NSC Consulting Corp.
23
expenses?
24
A.
Do
Do you see that listing I'm showing you?
Do you see that?
I can't tell you why.
Thomas Rankin
January 5, 2009
230 1
Q.
2
propriety of this?
3
A.
No.
4
Q.
Do you know who at State Street
5
Consultants decided to include that line item on
6
this cash flow report?
7
A.
I presume Mr. Clark.
8
Q.
Bottom of page 2 on Exhibit 5,
9
Mr. Rankin, the very last item we have another
Did anyone consult you about the
10
loan from NSC.
11
that loan?
12
A.
I don't recall.
13
Q.
Let me refer you back to page 3 of
14
Exhibit 5, Mr. Rankin.
15
this question but didn't quite get to the
16
question, and let me pin that down before we move
17
on.
18
Do you have any knowledge about
I think I asked around
We did talk about several line items
19
there near the bottom of the page, Cincinnati
20
Schools, Cincinnati Symphony, and all those other
21
clients listed there down to the bottom of page.
22
Do you know why, given that there was no actual
23
income through October on this cash flow report,
24
there is budgeted income for the last two months
Thomas Rankin
January 5, 2009
231 1
of 2007?
2
A.
I don't know why.
3
- - - - -
4 5
Thereupon, Plaintiff's Exhibit 6 is marked for purposes of identification.
6
- - - - -
7
Q.
8
Plaintiffs' Exhibit 6 and ask you to take a moment
9
and look at that, please.
I'd like to hand you now, Mr. Rankin,
Had a chance to look at
10
it?
11
A.
Yes.
12
Q.
Ready for a question?
13
A.
I am.
14
Q.
Okay.
15
A.
Right.
16
Q.
And Exhibit 5 is a State Street
17
Consultants Cash Flow Report, Year 2007, run on
18
November 14th, 2007.
19
6, and Exhibit 6 indicates that it is a State
20
Street Consultants 12 Month Cash-Flow Report, Year
21
2007, run on January 15, 2008.
22
A.
Yes.
23
Q.
And that difference in the run dates
24
explains, does it not, why whereas on Exhibit 5 we
We just looked at Exhibit 5.
Now we're looking at Exhibit
Correct?
Thomas Rankin
January 5, 2009
232 1
had budgeted amounts only for November and
2
December, on Exhibit 6 we have actual dollar
3
amounts for November and December, correct?
4
A.
5
is gone.
6
Q.
7
end and actual numbers are in, right?
8
A.
Yes.
9
Q.
If you would, why don't you keep
I would presume since the "budget" word
By this time we're two weeks past year
10
Exhibit 5 there, because I'm going to have you
11
compare Exhibits 5 and 6 on just a couple of
12
points.
13
A.
Uh-huh.
14
Q.
Exhibit 5, page 3, you and I looked at
15
together.
That's the Unclassified Income SA/NSC.
16
You see that?
17
A.
I do.
18
Q.
When we get over to Exhibit 6, also
19
page 3, we have an Unclassified Income SA/NSC
20
heading, but underneath that heading we do not
21
have those clients that we addressed on Exhibit 5,
22
starting with Cincinnati Schools, Cincinnati
23
Symphony, The Limited and so on.
24
those are gone?
You see that
Thomas Rankin
January 5, 2009
233 1
A.
I do.
2
Q.
Do you know why they don't appear on
3
Exhibit 6?
4
A.
Just looking at this briefly --
5
Q.
Yes, sir.
6
A.
-- it appears as though Janie,
7
Ms. Harrison, may have consolidated some
8
categories inadvertently.
9
Q.
Could you just tell us specifically
10
what you mean?
11
at and then tell us why you interpret it as you
12
do.
13
A.
14
Cancer.
15
Q.
Yes.
16
A.
I guarantee you American Cancer in
17
October did not pay with us -- pay State Street
18
Consultants, I'm sorry, $378,500.
19
Q.
It's a big number.
20
A.
It's a big number.
21
Q.
Okay.
22
figure includes not only the revenues realized
23
from American Cancer, but also revenues realized
24
from some other clients?
Direct us to what you are looking
Exhibit 6, page 3, under American
So you're assuming that that
Thomas Rankin
January 5, 2009
234 1
A.
Yes.
2
Q.
Is that the assumption you're making?
3
A.
Yes.
4
Q.
Do you know what other clients?
5
A.
I could only presume NSC Consulting
6
Corporation.
7
Q.
And why do you presume that?
8
A.
Because American Cancer was a client of
9
NSC Consulting Corporation.
10
Q.
11
Ms. Harrison did was lump all of the income from
12
NSC Consulting Corp. clients into just this one
13
line item which she's calling American Cancer?
14
A.
Most likely.
15
Q.
All right.
16 17
So your inference is that what
THE VIDEOGRAPHER:
Mr. Cvetanovich,
you've got about five.
18
MR. CVETANOVICH:
All right.
I think
19
he starts me out with six-minute tapes.
What do
20
you think?
21
Q.
22
any NFC -- excuse me -- NSC Consulting Corp.
23
revenues on this cash flow report for State Street
24
Consultants?
Do you know why Ms. Harrison included
Thomas Rankin
January 5, 2009
235 1
A.
2
heard that question a few minutes ago.
3
Q.
4
would, please, on Exhibit 6.
5
A.
Yes.
6
Q.
What starts out at the top of the page
7
I guess is actually carried over from the
8
preceding page.
9
need to look near the bottom of page 3, "Uses of
I don't know why.
Except I may have
Let me have you turn to page 4, if you
So to get a heading, we actually
10
Cash, Business Expenses."
11
A.
Yes.
12
Q.
And then the list carries over on to
13
the top of page 4.
14
sir?
15
A.
I do.
16
Q.
Looking then at the carryover portion
17
of that list, if you come down maybe an inch and a
18
half, you see NSC Corp. expenses.
19
where I'm directing your attention?
20
A.
I do.
21
Q.
And for the month of October, more than
22
$75,000 of NSC corporate expenses are being
23
reflected on this State Street Consultants cash
24
flow report.
Do you see that?
Do you see where I am there,
Do you see that?
Do you see
Thomas Rankin
January 5, 2009
236 1
A.
Yes.
2
Q.
I take it that means that State Street
3
Consultants paid $75,856 of NSC Consulting Corp.'s
4
expenses.
5
this?
6
A.
It could be interpreted that way.
7
Q.
All right.
8
page, we have another line item, and now we're
9
under "unclassified expenses," but another line
Is that the way you would interpret
Down at the bottom of the
10
item labeled "loan repayment to NSC."
11
that?
12
A.
Yes.
13
Q.
I think we are now done with 5 and 6,
14
Mr. Rankin.
15
but I'm done with them.
You can keep them there if you like,
16
- - - - -
17 18
Thereupon, Plaintiffs' Exhibit 7 is marked for purposes of identification.
19
- - - - -
20
Q.
21
Plaintiffs' Exhibit 7.
22 23 24
Do you see
Let me now hand you, Mr. Rankin,
THE VIDEOGRAPHER:
We are off the
record at 1727. (A brief recess is taken.)
Thomas Rankin
January 5, 2009
237 1 2
(Mr. Behal entered the conference room.)
3
THE VIDEOGRAPHER:
We are back on the
4
record at 1740.
5
Q.
6
break I handed you Plaintiffs' Exhibit 7.
7
you now had an opportunity to look that over?
8
A.
Yes.
9
Q.
Plaintiffs' Exhibit 7 is State Street
Mr. Rankin, just before we took a short Have
10
Consultants' 12 Month Cash-Flow Report, Year 2008,
11
the run date being November 19, 2008, correct?
12
A.
Yes.
13
Q.
Let me direct your attention to page 4
14
of the report, under the heading "business
15
expenses," and very near the list -- near the end
16
of the list of business expenses we have a line
17
item for NSC Corp. expenses.
18
A.
Yes.
19
Q.
And there are expense amounts noted for
20
each month, January through October, of 2008.
21
total amount for 2008 being $79,081.
22
that?
23
A.
Yes.
24
Q.
And this statement reflects, does it
Do you see that?
The
Do you see
Thomas Rankin
January 5, 2009
238 1
not, that NSC corporate expenses are being treated
2
as expenses by State Street Consultants?
3
A.
Can you repeat that?
4
Q.
Yes.
5
showing up as expense items on a cash flow report
6
for State Street Consultants, correct?
7
A.
Uh-huh.
8
Q.
You need to say yes or no.
9
A.
Yes.
10
Q.
The inference from that would be that
11
these NSC corporate expenses are being paid with
12
cash or income of State Street Consultants,
13
correct?
14
A.
That's not correct.
15
Q.
Well, the essence of this report is to
16
present sources of income and uses of cash,
17
sources and uses of cash by State Street
18
Consultants, correct?
19
A.
20
presume that's what they were trying to do.
21
Q.
22
cash is, right?
23
A.
Yes.
24
Q.
Or stated differently, that's what a
This report --
We've got NSC corporate expenses
It's not my report, so I can only
Well, that's what a sources and uses of
Thomas Rankin
January 5, 2009
239 1
cash flow report is?
2
A.
Yes.
3
Q.
And this one is for State Street
4
Consultants, correct?
5
A.
It is.
6
Q.
And it reflects State Street
7
Consultants' sources of cash and its uses of cash,
8
correct?
9
A.
Yes.
10
Q.
And this report shows on page 4 that
11
one of the uses of State Street Consultants' cash
12
was to pay NSC corporate expenses.
13
the form shows, correct?
14
A.
That's what it appears.
15
Q.
All right.
16
that.
17
That's what
I think we're done with
I just have a series of documents that
18
I'd like you to identify for us, if you would,
19
Mr. Rankin.
20
but you know the documents better than any of the
21
rest of us.
22 23 24
I think they're fairly self-evident,
- - - - Thereupon, Plaintiffs' Exhibit 8 is marked for purposes of identification.
Thomas Rankin
January 5, 2009
240 1
- - - - -
2
Q.
3
document that's been marked Plaintiffs' Exhibit 8.
4 5
First of all, let me hand you a
MR. CVETANOVICH:
Do you want one also,
Bob?
6
MR. BEHAL:
7
MR. CVETANOVICH:
No.
Thank you, though. You're welcome.
8
Q.
Had a chance to look that over?
9
A.
Uh-huh.
10
Q.
Yes?
11
A.
Yes.
12
Q.
That's all right.
13
8 is State Street Consultants, LLC, Balance Sheet
14
as of December 31, 2006, correct?
15
A.
Yes.
16
Q.
And you caused this to be generated or
17
printed for purposes of being produced to the
18
Plaintiffs in this litigation, correct?
19
A.
20
Yes.
Thereupon, Plaintiffs' Exhibit 9 is marked for purposes of identification.
23 24
Plaintiffs' Exhibit
- - - - -
21 22
Sorry.
- - - - Q.
Let me now hand you Plaintiffs' Exhibit
Thomas Rankin
January 5, 2009
241 1
9.
2
now, Mr. Rankin?
3
A.
Yes.
4
Q.
Exhibit 9 is State Street Partners,
5
PLL -- Exhibit 9 is State Street Partners, PLL,
6
Profit & Loss, January through December 2007,
7
correct?
8
A.
Yes.
9
Q.
And you caused this to be generated or
Have you had a chance to look over Exhibit 9
10
printed for purposes of production to the
11
Plaintiffs in this lawsuit, correct?
12
A.
Yes.
13
Q.
Having a little trouble keeping all
14
these things in any kind of a meaningful sequence
15
here, Mr. Rankin, but we just keep grinding
16
through them.
17
- - - - -
18 19
Thereupon, Plaintiffs' Exhibit 10 is marked for purposes of identification.
20
- - - - -
21
Q.
22
Had a chance to look that over, sir?
23
A.
Yes.
24
Q.
Exhibit 10 is State Street Consultants,
Let me hand you Plaintiffs' Exhibit 10.
Thomas Rankin
January 5, 2009
242 1
LLC, Balance Sheet, as of December 31, 2007,
2
correct?
3
A.
Yes.
4
Q.
And that is a document that you
5
generated or printed for purposes of production to
6
the Plaintiffs in this lawsuit, correct?
7
A.
Yes.
8
- - - - -
9 10
Thereupon, Plaintiffs' Exhibit 11 is marked for purposes of identification.
11
- - - - -
12
Q.
13
11.
14
Mr. Rankin?
15
A.
Yes.
16
Q.
Exhibit 11 is State Street Consultants,
17
LLC, Profit & Loss, January through December 2006,
18
correct?
19
A.
Yes.
20
Q.
And that is a document that you
21
generated or printed for purposes of production to
22
the Plaintiffs in this action, correct?
23
A.
24
Let me now hand you Plaintiffs' Exhibit Had a chance to look over Exhibit 11,
Yes. - - - - -
Thomas Rankin
January 5, 2009
243 1 2
Thereupon, Plaintiffs' Exhibit 12 is marked for purposes of identification.
3
- - - - -
4
Q.
5
12.
6
that, please.
7
Mr. Rankin?
8
A.
Yes.
9
Q.
Exhibit 12 is State Street Consultants,
Now let me hand you Plaintiffs' Exhibit I'll ask you to take a moment and look at Had a chance to look at that now,
10
LLC, Profit & Loss, January through December 2007,
11
correct?
12
A.
Yes.
13
Q.
And that is a document that you
14
generated or printed to be produced to the
15
Plaintiffs in this action, correct?
16
A.
Yes.
17
Q.
Let me ask you to get Exhibits 8 and 11
18
before you there.
19
A.
Uh-huh.
20
Q.
Do you have those two, sir?
21
A.
Yes.
22
Q.
You told me earlier that you prepared a
23
2006 federal tax return for State Street
24
Consultants, and my question for you is:
Are the
Thomas Rankin
January 5, 2009
244 1
net income figures from Exhibit 11 the same
2
figures that were carried over onto the 2006
3
federal income tax return of State Street
4
Consultants?
5
A.
6
2006 SSC -- State Street Consultants' P&L.
7
it is.
8
one.
I don't have the last two pages of the
I'm sorry.
Here
I was looking at the wrong
Sorry about that.
9
MR. BEHAL:
Sorry.
10
Q.
11
now, sir?
12
A.
I do.
13
Q.
Just so the record is clear, would you
14
identify the exhibit number?
15
A.
Exhibit 11.
16
Q.
Yes, sir.
17
A.
I would have to check the records, the
18
tax return.
19
Q.
20
haven't produced the tax returns yet?
21
A.
22
you would have been given them to me already.
23
Q.
24
for production to the Plaintiffs in this lawsuit?
Have you got the correct one before you
Are you aware that the Defendants
No.
Yes.
Yeah, I'm aware.
I guess
Have you been asked to assemble those
Thomas Rankin
January 5, 2009
245 1
A.
I have not as of yet.
2
Q.
Can you think of any reason why the
3
figures on the 2006 tax return for State Street
4
Consultants, LLC, that income figures would differ
5
from those reflected on the profit and loss
6
statement at which you're looking, which is
7
Exhibit 11?
8
A.
9
nondeductible expenses.
There would be a difference for certain
10
Q.
Such as what?
11
A.
Club dues is not deductible for tax
12
purposes.
13
Q.
14
would expect to be a difference between the net
15
income figures from the 2006 P&L and the 2006 tax
16
return?
17
A.
18
50 percent limitation.
19
Q.
20
expect to cause the net income figures that appear
21
on the P&L on the one hand and the tax return on
22
the other to differ?
23
A.
24
stated items.
All right.
Anything else that you
Meals and entertainment is subject to a
Okay.
Anything else that you would
Charitable contributions are separately
Thomas Rankin
January 5, 2009
246 1
Q.
Okay.
2
A.
Section 197 -- 179 expenses is a
3
separately stated item.
4
Q.
All right.
5
A.
Political contributions are not
6
deductible.
7
Q.
All right.
8
A.
That's all I can recall right now.
9
Q.
Subject to the adjustments which you've
Any other differences?
Any other differences?
Any other items?
10
just delineated for us, would you expect the net
11
income figure used on the 2006 federal income tax
12
return of State Street Consultants to be the same
13
as the net income figure reflected on Exhibit 11?
14
A.
Yes.
15
Q.
In fact, when you prepared the tax
16
return for State Street Consultants for 2006, was
17
your starting point this P&L statement, Exhibit
18
11?
19
A.
Possibly not.
20
Q.
What would have been your starting
21
point?
22
A.
23
accrual-based financial statement.
24
Q.
An accrual-based -- possibly an
Do you know that?
Thomas Rankin
January 5, 2009
247 1
A.
2
with accrual.
3
Q.
This is a cash-basis P&L, correct?
4
A.
That is correct.
5
Q.
Let me ask you now to turn your
6
attention to Exhibit 8.
7
is State Street Consultants, LLC, Balance Sheet as
8
of December 31, 2006.
9
reflected on Exhibit 8 the information you would
10
have utilized for Schedule L to the 2006 federal
11
income tax return of State Street Consultants?
12
A.
13
would need to look at the tax return to see if I
14
used an accrual-based balance sheet.
15
Q.
16
Consultants is a cash-basis taxpayer or an
17
accrual-basis taxpayer?
18
A.
19
cash-basis taxpayer.
20
Q.
21
cash-basis figures from the balance sheet to do
22
Schedule L on the tax return?
23
A.
Not necessarily.
24
Q.
You would just have to tax -- check the
I don't know for certain if we started
Excuse me.
8.
Exhibit 8
Is the information
This is a cash-basis balance sheet.
I
Do you know whether State Street
State Street Consultants is a
So wouldn't you be using these
Thomas Rankin
January 5, 2009
248 1
tax return to see what you did?
2
A.
Yes.
3
Q.
I think we are done with 8 and 11.
4
Let me ask you now to have before you,
5
if you would, Exhibits 10 and 12.
6
A.
Okay.
7
Q.
Would the net income figures that
8
appear on the profit and loss statement that is
9
Exhibit 12 be the same ones you would have used on
10
the 2007 federal income tax return for State
11
Street Consultants?
12
a minute.
13
A.
Okay.
14
Q.
Did you tell me that you did not -- or
15
that State Street Consultants did not file a 2007
16
federal income tax return?
17
A.
Correct.
18
Q.
So there was no entity return?
19
A.
Correct.
20
Q.
That was all picked up by Mr. Clark on
21
his personal income tax return?
22
A.
Schedule C.
23
Q.
Would the net income figures reflected
24
on Schedule C for Mr. Clark's 2007 federal income
Let me interrupt myself just
Thomas Rankin
January 5, 2009
249 1
tax return be the same as those reflected on
2
Exhibit 12, subject to that list of adjustments
3
you've already given us?
4
A.
Yes.
5
Q.
Since you didn't do an entity return
6
for SSC for 2007 but instead all of that was
7
picked up by Mr. Clark in his personal income tax
8
return filing, is there a schedule that
9
corresponds to Schedule L on the entity return?
10
A.
No.
11
Q.
Is there any place on Mr. Clark's
12
personal income tax return for 2007 that would
13
reflect balance sheet information of State Street
14
Consultants?
15
A.
No.
16
Q.
I think we're done with those two now.
17
Let me direct your attention to Exhibit
18
9.
19
Profit & Loss, January through December 2007.
20
I would like to ask you to flip over, if you
21
would, to page 3 of 3, down near -- excuse me.
22
First of all, do you have page 3 of 3, sir?
23
A.
Yes.
24
Q.
You're on the last page of the exhibit?
Exhibit 9 is State Street Partners, PLL, And
Thomas Rankin
January 5, 2009
250 1
A.
I am.
2
Q.
If you look down near the bottom of the
3
page, there is a line item for other income, and
4
an amount that appears to be $29,936.29.
5
see that?
6
A.
Yes.
7
Q.
Do you know what other income State
8
Street Partners had in 2007 that is reflected in
9
that line item?
Do you
10
A.
Yes.
11
Q.
What is that, please?
12
A.
That is income relating to the swap
13
transaction that State Street Partners entered
14
into to finance the building.
15
Q.
16
transaction.
17
A.
18
transaction is a derivative that is placed on the
19
open market to create a fixed income instrument in
20
a variable interest rate world.
21
Tell us what you mean by the swap
I'll do the best I can.
MR. BEHAL:
Swap
Pretty good.
22
Q.
23
Partners entered into such a transaction in 2007?
24
A.
Are you telling me that State Street
No.
Thomas Rankin
January 5, 2009
251 1
Q.
2
realized in 2007?
3
A.
4
understand, but it -- income of $29,936.29 was
5
realized in 2007.
6
Q.
7
undertaken?
8
A.
9
2003 through Fifth Third.
Are you saying that the income was
It's a very difficult transaction to
Do you know when the transaction was
It originated with the financing in
10
Q.
11
transaction.
12
A.
13
enters into a variable rate loan agreement.
14
Q.
With Fifth Third?
15
A.
With Fifth Third Bank.
16
Q.
All right.
17
A.
And in turn Fifth Third Bank goes into
18
the derivative market and sells a obligation for
19
the same principal amount at a different
20
fluctuating rate in order to create a fixed rate
21
environment for State Street Partners.
22
Q.
Keep going.
23
A.
That's the best I can do.
24
Q.
And you think that's complicated?
Tell me the structure of the
Enter into -- State Street Partners
Thomas Rankin
January 5, 2009
252 1
A.
To me it is.
2
Q.
I'm teasing you.
3
at 6:00 on a day we've been going all day, isn't
4
it?
5
A.
Right.
6
Q.
One other thing I want to ask you about
7
here.
8
please.
9
And it always will be. It's very complicated
Let me take you to page 2 of 3 if I may,
For that matter, we could have done 1
10
of 3, but let's stay on 2 of 3 since I directed
11
your attention there.
12
line on this page, probably four or five line
13
items from the bottom.
14
A.
Yes.
15
Q.
Are those the monthly increments that
16
total the 29,000 plus amount that we just looked
17
at together?
18
A.
Yes.
19
Q.
So that's income that was realized on a
20
monthly basis, correct?
21
A.
Yes.
22
Q.
I think those are all the questions I
23
have about that.
24
We have an "other income"
Do you see that?
Let's go off the record.
THE VIDEOGRAPHER:
We are off the
Thomas Rankin
January 5, 2009
253 1
record at 1810.
2
(A brief recess is taken.)
3
THE VIDEOGRAPHER:
4
We are back on the
record at 1817.
5
MR. CVETANOVICH:
6
all the questions I have at this time.
7
repeat something that we observed earlier in the
8
deposition, many of the documents that the
9
Plaintiffs sought from the defendants have not yet
Mr. Rankin, those are Just to
10
been produced.
11
almost certainly we will have some additional
12
questions for you, but until we get the documents
13
I think that's really all we can do.
14 15
When those documents are produced
I want to thank you for your time and attention.
I appreciate it very much.
16
THE WITNESS:
17
MR. WEAVER:
18
THE VIDEOGRAPHER:
19
deposition of Thomas Rankin.
20
witness has the right to review the videotape if
21
you wish to exercise your right at this time.
Okay. Thank you.
22
MR. WEAVER:
23
THE VIDEOGRAPHER:
24
record at 1818.
This concludes the At this time the
No. We are off the video
Thomas Rankin
January 5, 2009
254 1
- - - - -
2
Thereupon, the foregoing proceedings
3
concluded at 6:18 p.m.
4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
- - - - -
Thomas Rankin
January 5, 2009
255 1
State of Ohio
2
County of Franklin: SS
3
:
C E R T I F I C A T E
I, Cindy L. Knecht, a Notary Public in and for
4
the State of Ohio, do hereby certify the within
5
named Thomas A. Rankin was by me first duly sworn
6
to testify to the whole truth in the cause
7
aforesaid; testimony then given was by me reduced
8
to stenotypy in the presence of said witness,
9
afterwards transcribed by me; the foregoing is a
10
true record of the testimony so given; and this
11
deposition was taken at the time and place as
12
specified on the title page.
13
I do further certify I am not a relative,
14
employee or attorney of any of the parties hereto,
15
and further I am not a relative or employee of any
16
attorney or counsel employed by the parties
17
hereto, or financially interested in the action.
18
IN WITNESS WHEREOF, I have hereunto set my
19
hand and affixed my seal of office at Columbus,
20
Ohio, on January 6, 2009.
21
______________________________________________
22
Cindy L. Knecht, Notary Public - State of Ohio
23
My commission expires August 3, 2009.
24
Thomas Rankin
January 5, 2009
256 Witness Errata and Signature Sheet Spectrum Reporting LLC
Correction or Change Reason
333 East Stewart Avenue
1 - Misspelling
2 - Word
3 - Wrong Word
4 -
Code Omitted Columbus, Ohio 43206 Clarification Phone - 614-444-1000
Fax - 614-444-3340
5 - Other Correction (Please
explain) Email - [email protected]
R
Sheet
_____ of
_____ Page/Line
Correction, Addition, or Change
Reason Code
_________
_________________________________________
___________
_________
_________________________________________
___________
_________
_________________________________________
___________
_________
_________________________________________
___________
_________
_________________________________________
___________
_________
_________________________________________
___________
_________
_________________________________________
___________
_________
_________________________________________
___________
_________
_________________________________________
___________
_________
_________________________________________
___________
_________
_________________________________________
___________
_________
_________________________________________
___________
_________
_________________________________________
___________
_________
_________________________________________
___________
_________
_________________________________________
___________
_________
_________________________________________
___________
_________
_________________________________________
___________
I, Thomas A. Rankin, have read the entire transcript of my deposition taken in this matter, or the same has been read to me.
I request that the changes noted on my
errata sheet(s) be entered into the record for the reasons indicated. Date ____________________
Signature
___________________________________________________________ The witness has failed to sign his deposition within the time allowed. Date ___________________
Signature
___________________________________________________________
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