Pa. Ethics Com­mis­sion fines lobby groups

Groups op­posed bills to limit ac­cess to drugs for in­jured work­ers.

The Morning Call - - STATE/REGION - By Steve Esack

HARRISBURG — The Penn­syl­va­nia Ethics Com­mis­sion fined a Philadel­phia law firm's lob­by­ing wings for late dis­clo­sure of their in­volve­ment in Twit­ter and ad­ver­tis­ing cam­paigns against work­ers' com­pen­sa­tion bills.

The rul­ings, made pub­lic Fri­day, found that lob­by­ists failed to abide by the state's Lob­by­ing Dis­clo­sure Law's pub­lic re­port­ing re­quire­ments while or­ches­trat­ing more than 100 tweets and other “in­di­rect com­mu­ni­ca­tion” mes­sages meant to in­flu­ence leg­is­la­tion in the state Capi­tol.

The out­fits, PA Works Now and Cit­i­zens to Pro­tect our Penn­syl­va­nia, agreed to pay a com­bined $29,080 in fines for fail­ing to regis­ter with the Penn­syl­va­nia Depart­ment of State, which ad­min­is­ters the dis­clo­sure law.

The groups spent more than $115,800 on pro­fes­sional lob­by­ists, on­line posts, bill­boards and fly­ers aimed at de­feat­ing two bills, ac­cord­ing to the rul­ings. The bills would have lim­ited in­jured work­ers' ac­cess to pre­scrip­tion drugs by cre­at­ing a state-ap­proved list of med­i­ca­tions and dosages.

One bill was spon­sored by Rep. Ryan Macken­zie, R-Le­high. It was de­feated in the House in 2017. The Se­nate spear­headed an­other ver­sion of the bill that Demo­cratic Gov. Tom Wolf later ve­toed.

The rul­ings do not say who fronted the lob­by­ing groups.

PA Works Now was fi­nanced by the work­ers com­pen­sa­tion law firm Pond Le­hocky Stern Gior­dano, ac­cord­ing to a June 2017 Morn­ing Call story.

The story quoted one of the firm's part­ners, Sa­muel Pond, in op­po­si­tion to Macken­zie's bill. The story also ex­posed how Pond's law firm owned its own phar­macy, Work­ers First, which its le­gal clients used for pre­scrip­tion med­i­ca­tion that could have been re­duced un­der the bill.

Pond Le­hocky later funded Cit­i­zens to Pro­tect our Penn­syl­va­nia to op­pose a Se­nate bill that was a copy­cat ver­sion of Macken­zie's failed bill.

Pond did not re­spond to a call for com­ment on Fri­day.

To nav­i­gate the Com­mis­sion's in­ves­ti­ga­tion, Pond Le­hocky hired Matt Haver­stick, a lawyer with ex­per­tise in han­dling state ethics cases and other le­gal mat­ters in­volv­ing state gov­ern­ment.

“It was a ne­go­ti­ated res­o­lu­tion to a sit­u­a­tion ev­ery­one, in­clud­ing the com­mis­sion, ac­knowl­edged was a mis­take,” Haver­stick said Fri­day. “By ‘mis­take,' I mean an ac­ci­dent. None of this was done in­ten­tion­ally.”

If at least $2,500 is spent to in­flu­ence an is­sue in Harrisburg, the law gives lob­by­ists 10 days to regis­ter with the Depart­ment of State. The reg­is­trants then have to file quar­terly re­ports de­tail­ing how much they spent on “di­rect [or] in­di­rect” com­mu­ni­ca­tion, meals or gifts to state of­fi­cials.

The lob­by­ing law is an im­por­tant trans­parency tool, said Melissa Melewsky, a lawyer who is reg­is­tered as a lob­by­ist for the Penn­syl­va­nia NewsMe­dia As­so­ci­a­tion, which also is a reg­is­tered lob­by­ing out­fit. The reg­is­tra­tion costs tied to it are cheap, too, for lob­by­ists, she said.

“It's not an oner­ous process,” Melewsky said.

PA Works didn't regis­ter its lob­by­ing ac­tiv­i­ties un­til 388 days af­ter it started, the rul­ing states. The Cit­i­zens group also was late. Both groups missed quar­terly ex­pense re­port­ing dead­lines, too.

In Fe­bru­ary, 2017, Macken­zie in­tro­duced House Bill 18. It would have cre­ated a pre-ap­proved list, or “for­mu­lary,” of opi­oids and other drugs for in­jured em­ploy­ees re­ceiv­ing med­i­cal care and fi­nan­cial as­sis­tance for lost wages un­der the Work­ers Com­pen­sa­tion Act of 1915. Any non­ap­proved drugs would need to be sought through an ap­peals process over­seen by the Depart­ment of La­bor & In­dus­try as well as a work­ers' com­pen­sa­tion judge.

By the spring, Macken­zie was tar­geted by Pa Works Now's ad­ver­tis­ing blitz.

“House Bill 18 would de­stroy #in­jured­work­ers rights to fair med­i­cal treat­ment. Tell @RepMacken­zie to #StopHB18. pa­work­snow.com,” one May 17, 2017, tweet read.

A month later, the House post­poned a vote on the bill af­ter op­po­si­tion mounted from po­lice, teach­ers, con­struc­tion work­ers, lawyers and doc­tors.

In Septem­ber 2017, The Philadel­phia Inquirer pub­lished a deeper in­ves­tiga­tive story into Pond Le­hocky's phar­macy unit, find­ing it charged much higher prices for pre­scrip­tions. The firm later an­nounced it was drop­ping its phar­macy unit, but not be­fore the Re­pub­li­can-con­trolled Se­nate be­gan adopt­ing Se­nate Bill 936 to set up the for­mu­la­ries.

In Jan­uary, the Cit­i­zens group be­gan mail­ing thou­sands of fly­ers in op­po­si­tion to the bill, a rul­ing states.

The Se­nate bill passed both cham­bers. Wolf ve­toed it in mid-April.

Fol­low­ing for­mal com­plaints, the Ethics Com­mis­sion ini­ti­ated in­ves­ti­ga­tions against both out­fits. The in­ves­ti­ga­tion found Cit­i­zens and PA Works Now failed to regis­ter as lob­by­ists un­til af­ter Wolf 's veto — April 30 and May 24, re­spec­tively.

Pa Works and Cit­i­zens agreed to pay fines of $13,580 and $15,500 re­spec­tively, and promised to abide by the law.

MORN­ING CALL FILE PHOTO

The Penn­syl­va­nia Ethics Com­mis­sion fined two lob­by­ing groups for late dis­clo­sure of their op­po­si­tion to two bills.

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