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Staying for free at an overseas luxury hotel should be disclosed by U.S. lawmakers as a gift, a judge said in upholding the corruption indictment of Senator Robert Menendez.
Menendez, a New Jersey Democrat, stayed for three nights at the Park Hyatt Paris-Vendome in 2010 after donor Salomon Melgen covered the $4,934 bill with American Express rewards points, prosecutors alleged in an April 1 indictment of both men.
Prosecutors charged Menendez with false statements for failing to disclose on his Senate ethics forms that Melgen gave him gifts of hotel stays in Paris and the Dominican Republic, chartered and first-class commercial flights, and a car service.
U.S. District Judge William Walls on Thursday rejected a motion by Menendez to dismiss the charge. The senator argued the Amex points had “no intrinsic value” and didn’t pass the reporting threshold of $335 on his annual financial disclosure form.
“A hotel room stay is certainly a ‘thing of value,’ regardless of how Dr. Melgen originally paid for it,” Walls ruled Thursday. “Senator Menendez gives no case law to support the absurd proposition that receiving a free hotel room purchased with Dr. Melgen’s Amex points is the same as earning frequent flyer miles through his own purchases.”
On Sept. 28, Walls threw out four of the 22 counts in ruling on 10 of 15 motions by both men to dismiss the case in federal court in Newark, New Jersey. Walls on Thursday rejected the remaining motions to dismiss the case, setting the stage for a trial next year.
Menendez on Friday filed a notice that he would appeal the judge’s rulings.
Prosecutors also charged that Menendez failed to disclose a three-night stay with Melgen and his wife in a two-bedroom hotel suite in the Dominican Republic. Menendez claimed in a motion that the stay wasn’t a reportable gift because the room was rented by Melgen, citing a “personal hospitality” exemption under the Ethics in Government Act.
Walls rejected that argument, saying the exemption “applies only when an official stays at the ‘personal residence’ of an individual or on ‘property or facilities owned by that individual.”’ He said he could find no case law showing that a rental qualified as personal hospitality. In any event, the hotel suite clearly wasn’t Melgen’s personal residence, the judge said.
Menendez had to report gifts worth more than $305 in 2006 and those valued at $335 or more in years after that under the ethics law, the indictment charged. In his motion, Menendez claimed prosecutors failed to say which gifts he didn’t report and didn’t say why they were reportable.
Walls rejected those arguments as well.
The senator also is charged with bribery, conspiracy and fraud for taking almost $1 million in campaign donations and other gifts from Melgen, a Florida eye doctor. In exchange, Menendez helped Melgen in a Medicare overbilling case, a contract dispute with the Dominican Republic and visa applications for three girlfriends, prosecutors say.
Menendez and Melgen are charged with conspiracy, bribery, honest-services fraud and violating the Travel Act. Menendez was also accused of making false statements.
Walls earlier dismissed two bribery counts against each man that related to separate $20,000 donations that Melgen gave in 2011 and 2012 to a legal defense trust fund that benefited Menendez. Walls said prosecutors failed to meet the legal standard to charge those donations as a crime.
The case is U.S. v. Menendez, 15-cr-00155, U.S. District Court, District of New Jersey (Newark).
This article was written by David Voreacos from Bloomberg and was legally licensed through the NewsCred publisher network.