from the Circuit Court of Du Page County. No. 12-CF-1736
Honorable Liam C. Brennan, Judge, Presiding.
JUSTICE HUTCHINSON delivered the judgment of the court, with
opinion. Justices McLaren and Zenoff concurred in the
judgment and opinion.
1 This appeal from a judgment of conviction raises questions
of first impression concerning section 33E-17 of the Criminal
Code of 1961 (Code) (720 ILCS 5/33E-17 (West 2012)). This
statute criminalizes a local government employee's
"unlawful participation" in a contract with his or
her government employer without the employer's informed
consent. Enacted in 1999 (see Pub. Act 90-800, § 5 (eff.
Jan. 1, 1999)), the statute provides as follows:
"Whoever, being an officer, director, agent, or employee
of, or affiliated in any capacity with any unit of local
government or school district participates, shares in, or
receiv[es] directly or indirectly any money, profit,
property, or benefit through any contract with the unit of
local government or school district, with the intent to
defraud the unit of local government or school district is
guilty of a Class 3 felony." Id.
this is a question of first impression with respect to
section 33E-17, we note that there are similar prohibitions
in other Illinois statutes (see 50 ILCS 105/3 (West 2012); 65
ILCS 5/3.1-55-10 (West 2012)), as well as a rich history of
precedent addressing undisclosed conflicts of interest by
government officials. See, e.g., People v.
Scharlau, 141 Ill.2d 180 (1990); Miller v. County of
Lake, 79 Ill.2d 481 (1980); People v. Savaiano,
66 Ill.2d 7 (1976). With that in mind, we turn to the facts
of this case, which may be stated simply.
2 In 2005, defendant, David M. Tepper, began working as the
manager of the information technology (IT) department of the
Forest Preserve District of Du Page County (the District).
Defendant was the second-highest-ranking person in the
District's IT department. The director of the IT
department, and defendant's immediate superior, was Mark
McDonald. Like most government agencies, the District has
regulations in place that prohibit its employees from
obtaining supplemental employment without prior authorization
from the District. See Du Page County Forest Preserve
District Ordinance No. 92-255 (approved Aug. 4, 1992). The
purpose of such rules is to protect against conflicts of
interest or other forms of employment that might reflect
adversely on the government as an employer. See
Miller, 79 Ill.2d at 490. In September 2005,
defendant signed a form acknowledging that he had received an
employee handbook and was aware of and would abide by the
District's regulations, including the prohibition on
unauthorized supplemental employment.
3 In June 2008, defendant became an "independent sales
agent" for USA Digital, an Oklahoma-based company that
sells equipment and services for wide area networks. Wide
area networks, or WANs, are discrete telecommunications and
broadband networks, which provide phone service as well as
Internet access. USA Digital's agents earn commissions by
closing sales contracts for USA Digital's bandwidth and
services. In his agent agreement with USA Digital, defendant
directed USA Digital to pay his sales commissions not to him
directly but instead to a corporation named "Integrated
Design Solutions" (IDS), which defendant had established
some years earlier. It is undisputed that defendant never
disclosed his relationship with USA Digital or IDS to the
4 In January 2009, the District Board held a planning
meeting. There, McDonald introduced defendant to the Board.
Defendant then gave a presentation in which he told the Board
that the District's three-year contract with its
then-current WAN provider, Qwest, would be expiring. Minutes
from that meeting indicate that defendant told the Board that
the District's network was around 0.8 megabytes per
second and that "[s]taff would like to increase this
speed to 2.515 megabytes per second to accommodate [the]
increased growth of *** applications and requirements."
The minutes are ambiguous as to whether it was defendant or
McDonald who recommended that, in a new contract with Qwest,
the District should seek to increase its network speed by
roughly 300%. The minutes indicate that "staff"
would, at the Board's next meeting, propose a three-year
contract with Qwest costing approximately $21, 500 per month.
5 Inexplicably, the WAN contract was not competitively bid,
even though, at the time, competitive bidding was required
under state law for all of the District's contracts worth
over $20, 000. See 70 ILCS 805/8(b) (West 2012). (The limit
was recently raised to $25, 000. See Pub. Act 99-771, §
10 (eff. Aug. 12, 2016)). At any rate, in March 2009,
McDonald and "staff" submitted to the Board a draft
resolution seeking to enter into a contract with USA
Digital-not Qwest. The Board approved the resolution and in
May 2009 the District executed a contract with USA Digital,
which ran from September 2009 to October 2012. Under the
agreement, the District would pay USA Digital around $28, 600
a month, or $1, 030, 000, for three years of broadband
service. The Board's president and a commissioner both
testified that the resolution would not have been adopted and
the contract would not have been executed had the District
known of defendant's connection to IDS or USA Digital.
6 Once the deal was closed with the District, USA Digital
began to pay commissions to IDS, including a $12, 000 bonus
for the contract itself and approximately $2, 000 per month
for each month of the contract. A few months into the
contract, a vice president from USA Digital came to Du Page
County to meet with defendant (who was "USA
Digital's sales agent") and "the client, "
i.e., McDonald, who was the District's
"representative." The vice president did not know
that defendant worked for the District, or that defendant
worked with McDonald, or that McDonald stood to gain anything
from defendant's commissions. The vice president thought
he was supervising defendant as a sales agent.
7 The scheme was discovered in November 2011. Shortly
thereafter defendant and McDonald left the District's
employment, and USA Digital ceased its commission payments to
IDS in July 2012, which was 29 months into the contract. By
that time, IDS had received nearly $80, 000 in commissions,
and evidence showed that both defendant and McDonald had made
withdrawals from IDS's bank account.
8 The State charged defendant and McDonald with a number of
offenses. Specifically, defendant was charged with 29 counts
of unlawful participation, one for each of the monthly
commission payments deposited into IDS's bank account
(the first three deposits included defendant's $12, 000
bonus), which were withdrawn by either defendant or McDonald.
Defendant opted for a severed bench trial at which the
evidence we have discussed was presented. In closing
argument, defendant asserted that his participation in the
USA Digital contract was not "with the intent to
defraud" as required under section 33E-17, because the
Forest Preserve "had not sustained any *** pecuniary
loss." Rather, defendant argued, the District had
received the telecom services for which it had contracted;
furthermore, one of the District's commissioners even
testified that the USA Digital contract seemed like "a
good deal." Defendant also argued that a conviction of
the offense of unlawful participation could not be based on
"an omission, " which is how defendant