Ex-regulator, lobbyist, utility owner arraigned in federal bribery case

Former Arizona Corporation Commission Chairman Gary Pierce and Johnson Utilities owner George Johnson had nothing to say for themselves after pleading not guilty to federal charges in the U.S. District Court on June 7.

Pierce, his wife Sherry, Johnson and lobbyist Jim Norton appeared briefly and entered their pleas of not guilty to charges of felony conspiracy, bribery, mail fraud and five counts of wire fraud brought against them on May 23.

As the Pierce couple left the courthouse shielded from the press, Sherry Pierce also remained silent, but her attorney Ashley Adams offered a brief statement on the Pierces’ behalf.

“Mr. and Mrs. Pierce have served Arizona in various public capacities for the last twenty years,” Adams said, “and they are going to vigorously defend these allegations until they’re vindicated or their good name is cleared.”

Sherry Pierce was placed on leave without pay from her position as deputy district director for Congressman Andy Biggs’ office following the indictment.

Johnson also left the hearing and declined to comment. He has removed himself from the management of his Pinal County utility company since the charges were brought.

Norton, a longtime Capitol lobbyist who was representing Johnson’s interest, said he looks forward to the “full facts of this case coming out and clearing my reputation and my name.”

Following the indictment, Norton stepped down from his post as managing partner of the firm he founded in 2015, Axiom Public Affairs, to focus on his defense.

His attorney, Ivan Matthew, previously released a statement insisting the federal charges hinge on allegations made by an “unindicted co-conspirator” whose motivations will become “transparent” once the identity is revealed.

The hearing brought the public no closer to learning who that person may be.

The trial is currently set for August 1.

Johnson Utilities has business before the Corporation Commission, on which Gary Pierce served from 2007 to 2014.

The indictment alleges the defendants conspired for Johnson to pay the Pierces through Norton and the unknown co-conspirator in exchange for Pierce’s favorable votes. Pierce and his wife allegedly received $31,500 from Johnson.

In an arrangement federal prosecutors claim was meant to conceal the funds’ original source, Norton allegedly directed the consulting firm through which the Pierces received the money from Johnson. The firm was allegedly established by an unnamed person, under Norton’s instructions, along with a checking account to receive about $6,000 a month, plus expenses. The unnamed co-conspirator then paid Sherry Pierce $3,500 a month, and she received those payments for 10 months in 2011 and 2012, according to the indictment.

The indictment also alleges that Norton and Gary Pierce had the opportunity to purchase land valued at $350,000 with funds from Johnson. An email from Pierce to Norton in December 2011 shows an opening bid of $300,000 and a letter of intent to purchase it, from which Pierce wanted his name removed so that Norton would be the sole buyer.

Ultimately, prosecutors allege the scheme was intended to “defraud and deprive the ACC, the customers of Johnson Utilities LLC and the citizens of the state of Arizona of their right to the honest services of elected members of the ACC through concealment of material information and bribery.”