Trial for Ex-Ally of New York Governor Goes to Jury

MANHATTAN (CN) – With New Yorkers heading to the polls later this year, a federal jury will start deciding on Wednesday whether another former ally of the incumbent governor will head to prison.

The three-week trial of Alain Kaloyeros, the former president of the State University of New York’s Polytechnic Institute, ended this week on more modest expectations than when it began as a corruption case in 2016.

Though prosecutors dropped the bribery charges shortly before trial, Assistant U.S. Attorney Matthew Podolsky told the jury that the scholar had abused the public trust to rig bids on enormous development projects in Syracuse and Buffalo. The latter project, known as Buffalo Billion, meant to flush a struggling upstate city with a 10-figure sum.

“The state of New York trusted Alain Kaloyeros with all of that taxpayer money, and he abused that trust,” Podolsky said.

“Working with Todd Howe, Kaloyeros rewarded Howe's clients with that money. He made sure that the money went to their friends, or BFFs, as he called them,” the prosecutor added, using shorthand for “Best Friends Forever” familiar to generations of middle schoolers. “And he and those men, the men sitting behind me, committed a federal crime – fraud – to do it.”

A disgraced former lobbyist, Howe was the government’s star witness at a separate trial earlier this year against Joseph Percoco, former deputy to New York Governor Andrew Cuomo. Howe had served two generations of Cuomos – the current governor and his father, Mario – before admitting to several federal felonies.

Howe’s testimony later helped to convict Percoco but it also led to the witness’s own arrest after he appeared to admit on the stand to a new crime: defrauding his credit card company.

Prosecutors declined to call Howe to testify again in the Kaloyeros trial, an irony not lost upon defense attorney Michael Miller.

“One of the oddest parts of this trial is that Todd Howe was here, but he wasn't here,” Miller said.

Kaloyeros has been standing trial with three developers: Buffalo power player Louis Ciminelli and Syracuse-based Cor Development executives Steven Aiello and Joseph Gerardi.

In one message, Gerardi scribbled a handwritten note asking whether a request for proposals seeming “too telegraphed??”

“That is Joseph Gerardi telling Alain Kaloyeros that his bid-rigging scheme was too obvious and they were going to get caught,” Podolsky said.

While Miller said Kaloyeros had no reason to rig any bids, Podolsky said called the motive both obvious and irrelevant.

“For some people, like Louis Ciminelli, Steven Aiello and Joseph Gerardi, that reason is money – millions and millions of dollars for the companies that they own and they ran,” Podolsky said. “And for some people, like Alain Kaloyeros, it is about power and hubris.”

Quoting an email Kaloyeros wrote to Howe, Podolsky said that it showed the academic jockeyed for clout with the governor to continue the rise of his academic star.

“You might think this is silly, but having the trust and faith of the administration in my unequivocal loyalty, discretion and allegiance to the cause is paramount,” Kaloyeros wrote in an email to Howe in March 2013. “Otherwise, you don’t want me to be nor can I be part of the team.”

Bolstering a reputation as an academic “rock star,” Kaloyeros wanted to become president of the 65th campus of the SUNY system, Podolsky said.

“He wanted to be his own boss and run a university - to be a big deal,” the prosecutor said. “That's what he wanted most of all. That's why his relationship with Todd Howe was so important.”

Miller countered that the question is not his client’s pursuit of power but whether he engaged in fraud.

“That system is not on trial today,” Miller said. “That's why we vote every four years.”

Ciminelli’s attorney Paul Shechtman said on Tuesday that concern for Buffalo – not favoritism – drove the process.

“The main point here is that the headquartered in Buffalo requirement in this [request for proposals] was not put in by anyone to favor LPCiminelli,” Shechtman said, referring to his client’s firm. “It was put in the RFP to favor Buffalo.”

Subscribe to Closing Arguments

Sign up for new weekly newsletter Closing Arguments to get the latest about ongoing trials, major litigation and hot cases and rulings in courthouses around the U.S. and the world.

Email *

Submit