SAN FRANCISCO LAWFUEL – Law News Network – United States Attor…

SAN FRANCISCO LAWFUEL – Law News Network – United States Attorney Kevin V. Ryan announced that a federal grand jury in San Francisco indicted a former contract employee in the procurement office of the University of California, San Francisco (UCSF), on public-corruption charges. Steven Donnelly is charged with selling confidential bid information to a competing vendor bidding on a UCSF contract. The prosecution is the result of a two month investigation by the Federal Bureau of Investigation and the University of California, San Francisco Police Department.

“UCSF is entitled to an honest and truly competitive bidding process on this important fiber optics project,” U.S. Attorney Kevin V. Ryan said. “According to this indictment, a contract employee of UCSF breached his duty of honest services by undermining the competitive bidding process at a public university.”

According to the indictment, Mr. Donnelly, 45, of Clayton, Calif., was involved in the competitive bidding process for a contract to install fiber optics to connect all of UCSF’s satellite offices in the San Francisco Bay Area. By June 2006, the competitive bidding process had been narrowed to AT&T and Verizon Business. In June, 2006, Verizon’s bid was sent back for re-evaluation and refinement of pricing based upon a technical study Verizon was conducting on the project.

In August 2006, Mr. Donnelly allegedly met with a Verizon employee and offered to provide the employee with AT&T’s confidential bid information in exchange for a BMW. Donnelly later met with the employee and agreed to provide the employee with a thumb drive containing the confidential material for $5,000 rather than the BMW. Verizon fully cooperated in this investigation.

Mr. Donnelly was arrested this afternoon and made his initial appearance in federal court in San Francisco today before Magistrate Judge Elizabeth D. Laporte, where he was released on $50,000 bail with electronic monitoring. His next scheduled appearance is on October 17, 2006, before U.S. District Court Judge William Alsup. The indictment was returned under seal on October 5, 2006, and unsealed this afternoon.

The maximum statutory penalty for theft of honest services mail fraud in violation of 18 U.S.C. §§ 1341, 1346, and 2 is 20 years and a fine of $250,000. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.

An indictment contains only allegations against an individual and, as with all defendants, Mr. Donnelly must be presumed innocent unless and until proven guilty.

Robin Harris is the Assistant U.S. Attorney who is prosecuting the case with the assistance of Tyle Doerr.

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