US appeal court upholds US$131m judgment against Steve Ferguson

FLORIDA'S Third District Court of Appeal on September 10 upheld a US$131 million judgment against businessman Steve Ferguson, concluding nearly two decades of litigation over fraud tied to the Piarco airport expansion.

A three-judge panel on September 10, affirmed a Miami-Dade jury’s finding that Ferguson engaged in civil fraud, conspiracy to commit fraud and violations of Florida’s Civil Remedies for Criminal Practices Act, known as Florida’s Civil RICO Act. The ruling closes a 19-year case centred on inflated contracts for the Piarco International Airport project.

Appellate judges Thomas Logue, Monica Gordo and Fleur Lobree held that Trinidad and Tobago, which filed suit in 2004, suffered a “domestic injury” in Florida because much of the conspiracy was planned and executed in Miami.

The ruling said evidence showed Ferguson funnelled millions of dollars through Miami accounts, destroyed incriminating documents in Florida and used Florida companies to push through inflated bids.

Ferguson, former head of the Maritime Group and a former chairman of National Gas Company, was found to have steered contracts to favoured firms in exchange for kickbacks. He received more than US$12 million in payments, some of which were used to bribe government officials, including co-defendant, former finance minister Brian Kuei Tung.

The appellate court noted that Florida has a vested interest in punishing schemes conducted within its borders, even when the primary victim is a foreign government. “Wrongful acts and plans were devised, initiated, and carried out through acts and communications directed toward Florida,” the opinion stated.

The decision leaves intact a final judgment of US$131,318,840.47 against Ferguson, which includes treble damages and prejudgment interest.

In a statement, Ferguson's legal team expressed disappointment with the ruling, “especially since the subject matter of the complaint pertains to contracts which are governed by the laws of Trinidad and Tobago and the High Court of Trinidad and Tobago has already determined that Trinidad and Tobago is the proper forum for the adjudication of the Piarco matters.

“Among the concerns stemming out of this ruling is the fact that the court erroneously identified Mr Ferguson as a United States citizen.

“Mr Ferguson and Mr Keui Tung intend to exercise their right to seek review from the Florida Supreme Court, and their attorneys have already started the process.”

Florida’s appellate ruling comes after almost two decades of litigation, six interlocutory proceedings and a month-long trial that Ferguson appealed after he, Kuei Tung and US businessman Raul Guitierrez Jr were found guilty of civil fraud, conspiracy to commit fraud, and violated Florida’s RICO Act.

The judges noted,”Upon our thorough review of the voluminous record evidence viewed in the light most favourable to the jury verdict, we affirm on all grounds.

“Here, domestic injury was shown where many parts of the conspiracy and racketeering activity occurred in Florida. Most importantly, the payment of the overinflated bids and bribes to co-conspirators Guiterrez and Kuei Tung, and the destruction of evidence.”

As they reviewed the evidence, the ruling added, “Ferguson hatched the conspiracy in Miami, and executed parts of the conspiracy in Miami, where he met with conspirators to ensure selection of the project consultant, concealed transfers through an agreement that he fabricated, reviewed documents relating to conspirators’ illicit payments, and transferred over US$1 million to Miami accounts held by Gutierrez. “Among other things, the evidence showed that Ferguson’s co-conspirators lived in and orchestrated the scheme from Florida, where fake invoices and backdated contracts were created and a hard drive containing incriminating evidence was destroyed.

“Florida-based companies pushed through overpriced bids and funnelled kickbacks to Miami-based accounts, and co-conspirator Gutierrez funnelled millions of dollars from accounts in Miami to Ferguson’s shell accounts at a Bahamian bank and paid another co-conspirator using checks from a business located in Miami.

“Thus, we hold that a domestic injury occurred in Florida where, over multiple years, wrongful acts and plans were devised, initiated, and carried out through acts and communications initiated in and directed towards Florida.”

The judges also referred to testimony from a former co-conspirator who pleaded guilty to federal charges of criminal conspiracy for his part in this arrangement and was sentenced to six years in prison.

“At trial in the instant civil case, he testified at length and admitted that his involvement in this bid-rigging was ‘probably the biggest mistake in my life,’” the ruling said.

It added, recounting the evidence, "Members of the conspiracy, including one of Ferguson’s co-defendants, were charged in federal court in Florida with, and pled guilty to, violating federal laws against fraud.”

The then-government, in 2004, filed the lawsuit in the US courts, naming over 40 defendants.

As the case proceeded, all but three settled or were dismissed.

“The case ultimately went to trial against Ferguson and two co-defendants (Kuei Tung and Guitierrez). The case was tried before a jury for a month. The jury ultimately entered a verdict finding Ferguson and his co-defendants liable on all four causes of action.”

On May 15, 2023, Miami district court judge Reemberto Diaz entered final judgment for TT in the racketeering case against the three for US$131,318,840.47.

The final judgment followed a jury’s verdict in March 2023, which led to TT getting triple the damages it sought under RICO law.

The ruling noted, “The conspiracy involved United States citizens and United States firms.

“Finally, to pay for part of the project, Trinidad and Tobago obtained a loan in the form of a letter of credit from a bank in Miami. The letter of credit was an asset of Trinidad and Tobago located in Miami and depleted in part by the conspiracy.

“These circumstances establish that the injury at issue did not ‘rest entirely on injury suffered abroad.’

"Florida is a world destination for finance, business, and construction. In interpreting Florida’s presumption against extraterritoriality, the sovereign state of Florida has a clear interest in preventing, punishing, and providing a remedy for those damaged in part in Florida and in part abroad as occurred here, by this type of criminal enterprise operating out of Florida.

“Here, Trinidad and Tobago sufficiently established a domestic injury under Florida Civil RICO.”