Rachmale told Ferguson that he had his team ready and that he didn’t need him on his management team.”

Why not tell him to forget about it?

“Again, I did not want to upset him, piss him off. We did not need him. I did not want my contracts unfairly canceled.”

Prosecution suggests: That’s why Lakeshore was willing to let Ferguson take half of Lakeshore’s management fee.

Ferguson was upset about the fees.

Hardiman would have a lot of “heartburn” when Ferguson came to collect the fees or when representatives of Mr. Ferguson would come collect the fees.

“I told him, we don’t want to upset him. Continue paying the fees and move on.”

Rachmale says they paid Ferguson and did not receive any services for it.

“I had a call from Ferguson once and wanted to have a meeting.”

Ferguson complained that Hardiman was not being fair and was going to help his company. He wasn’t doing “the right job.”

Fair? “Every time they came to collect payments, Hardiman would get upset and call them


Prosecution: “Did you tell Ferguson that you weren’t getting any work for it?”

Rachmale said he never told Ferguson that he wasn’t going to pay him not to upset him and start losing contracts again.


After the lunch meeting with Ferguson, Rachmale told Hardiman to continue paying the fees because he did not want to lose the contracts.  Remember the lost contracts ($5million $10million) 

Next we see a check from LES to Xcel Construction for $200,000 for "management fees" 8/28/08 

Rachmale says he did not receive any management services from Xcel. 

A&H Vendor report shows $572,221.22 paid to Xcel from 1/2007 to 11/2011 

Ferguson wanted work from change orders and again Rachmale was compelled to provide the money because he did not want to lose his contracts.  

Ferguson threatened to "shut down your projects" using "animated" and "F" language.  

Rachmale felt the threats were aimed at his employee's jobs. 

Ferguson confronted Rachmale in a parking lot yelling: "If you take my work away I will shut you down!!"


It was decided by LES that Ferguson would get a part of CM-865, but Ferguson was not on the proposal because Ferguson was on another contract CM-864.