The limited seating was packed, with about 50 people squeezed shoulder-to-shoulder into four rows of seats on the sides of an aisle leading into Courtroom 12C in the federal courthouse.
Extra chairs were put alongside the aisle. Some of Aaron Zahn’s friends and family members were moved into the jury box — four months after two sets of jurors had sat in a jury box for weeks, listening to prosecutors lay out the case that this was “the largest fraud in the history of Jacksonville.”
One set of jurors acquitted Ryan Wannamacher, the former CFO of the city’s publicly owned utility.
The other set found Zahn, the former CEO of JEA, guilty of fraud and conspiracy.
More: Money & Power: Inside the campaign to privatize JEA
So this — the tension-filled scene for the sentencing — felt like the end of a saga that began more than five years earlier, with then-Mayor Lenny Curry orchestrating an overhaul of the JEA board, the rapid elevation of Zahn to CEO and the attempted sale of the city’s utility.
As prosecutors reiterated Tuesday afternoon, the attempted sale, by itself, wasn’t a crime.
This doesn’t mean it wasn’t deceitful. It was deceitful, from start to aborted finish. And that should forever be a part of the legacy of Curry’s time as mayor. He and some of those close to him tried to sell JEA. It never was a good faith exploration of the pros and cons. It was an effort to reach a predetermined conclusion — one quite different from what played out Tuesday.
As Assistant U.S. Attorney A. Tysen Duva said, the crime wasn’t the attempted sale. It was “an effort to fleece the City of Jacksonville.”
Duva summed up all that has been reported and investigated and deliberated in the last five years by saying of the former CEO: “He came up with a bonus plan. He tried to hide it. He got caught.”
Fraud and ‘Fifty Shades of Gray’
In more than three hours, there were some surprising twists — perhaps starting with the defense seemingly re-litigating the case, making some of the same arguments tried during the last few years: A sale was just one option. There was nothing nefarious about the bonus plan. There were a series of steps required before it would’ve paid out. And, in the end, it never did pay out. So … no harm, no foul.
As Duva noted, we’d heard all of this during the trial.
“It’s called closing arguments,” he said.
Since a jury didn’t buy it then, one might’ve thought this would be the time when Zahn and his defense finally would pivot, admit some wrongdoing and hope for leniency.
Only the latter happened.
But first the defense delved into what constitutes “loss,” trying to argue that since Zahn didn’t walk away with tens of millions of dollars, there was no actual loss.
Legal dictionaries were cited.
“Fifty Shades of Gray” was cited.
No, not the steamy novel. This was the title of a Yale Law Journal article.
I did not start my day expecting to be sitting in the federal courthouse, Googling “Fifty Shades of Gray.” But after doing so, I can tell you that the 2016 article about “sentencing trends in major white-collar cases” isn’t exactly salacious reading.
Near the end, Lee Wedekind, an attorney representing JEA, refuted the idea that there wasn’t any actual loss. He said that the scandal cost the utility $76 million, largely because of lower bond ratings. And he said the loss went beyond those dollars.
“The fraud might be over, the scars remain,” he said.
The baking of a ‘deceitful pie’
U.S. District Judge Brian Davis listened to all of this — and the six people who spoke on Zahn’s behalf, including his father-in-law (who served as a U.S. attorney and judge in Georgia), his mother and his wife.
They talked about Zahn as a son, husband and father of three children, ages 10, 7 and 5.
This did feel different than everything in the past. It made the courtroom feel even more packed, the still air more charged. It was raw, emotional, and painful to watch. And that’s from the perspective of a detached observer. For the large contingent of family and friends, it had to be gut-wrenching.
And that led to a point Judge Davis, who is nearing the end of his long career, made when he started to speak: He said he could solve our crime problem if he could show people before they did something the pain it would lead to for their loved ones.
He began with some observations, saying he’d start where he usually concludes, with that support. He’d read letters written on Zahn’s behalf, listened to what was said in the courtroom, and been touched by the heartfelt testimonials.
But, he also said, there was something largely missing.
“Good people can and do make bad decisions,” he said.
He said that “when deceit and greed intersect, crimes like yours result.” He referred to the “deceitful pie you were baking” and listed a series of the ingredients, prefacing each with: “Consider the deceit, by act or omission …”
And then he gave the sentence.
Forty-eight months.
JEA weathered another storm
Zahn’s defense, which pushed for probation, wanted less. Some people in town wanted more. I never had strong feelings about this part of the JEA story. I just wanted something that, after all the gaslighting of the past few years, said there was indeed significant wrongdoing — and prevented it from happening again.
This — a former utility CEO likely will spend more than three years behind bars — does seem like a deterrent for others, near and far. In some ways it seems fair. In other ways it does not.
Zahn might’ve baked a deceitful pie, but he didn’t do it by himself.
Along the way, there were a lot of people — good, bad and, as we all are, a mix of both — who made bad decisions and helped this go as far as it did.
In the end, though, it was the public that prevented it from actually happening.
There were others who played a role. Some city officials, some council members, civic leaders and, yes, the media.
As part of pre-sentencing, Zahn’s defense referred to the “relentless” media coverage since 2018. I’m not sure how much of that was specifically directed at the Times-Union. But it’s true that my colleagues — particularly Nate Monroe, David Bauerlein and former T-U reporter Chris Hong — did not relent when it came to this story. Even when JEA was attacking their reporting. Even when some in City Hall were trying to bully anyone who stood in the way of the sale being fast-tracked. Even when, in Nate’s case, a private investigator working for a consulting firm tied to Florida Power & Light surveilled him.
But in the end, I do think it was the public that prevented the sale and what could’ve happened with it.
That’s what those involved repeatedly underestimated: Just how upset people were about what was happening. Some of that was pushback over trying to sell the city’s utility. Some of it was simply anger about being fed slice after slice of a deceitful pie.
One entity that emerged from all of this perhaps more appreciated: JEA.
As noted during sentencing, this did damage JEA in some measurable ways, mostly in that from-a-distance perspective of bond ratings and such. Locally, though, I think it made people do something you don’t often see: be grateful for their utility.
At one point during the JEA saga, I wrote a column that said this was another storm where the rank-and-file JEA employees kept the lights on.
That storm has passed and, at least for now, we’re back to bracing for hurricanes.
(904) 359-4212
This article originally appeared on Florida Times-Union: JEA, Jacksonville weathered storm of scandal
Source Agencies
