Report on Investigation — The Lobbying Activities of Keith Beardsley (page 7 of 9)

Findings

Report of the Investigations Directorate

The Investigations Directorate examined whether Mr. Beardsley engaged in activities that required registration as a lobbyist, and whether he was subject to the five-year prohibition on lobbying under the Lobbying Act. Evidence was obtained from various sources, including federal public office holders, Mr. Beardsley, his partners and his clients, supporting the following findings.

Documents obtained by the Investigations Directorate indicated that True North Public Affairs (TNPA) and DAVE Wireless entered into an agreement on November 20, 2009, when a proposal submitted by TNPA was approved by the Vice President of Marketing at DAVE Wireless, Ms. Sara Moore.

In the proposal provided by TNPA to DAVE Wireless, TNPA agreed to "…provide consulting services to DAVE Wireless in respect of its efforts to communicate with Government of Canada officials regarding the recent CRTC decision concerning Globalive."

The Canadian Radio-television and Telecommunications Commission (CRTC) decision on Globalive

In 2007, the Minister of Industry announced the terms of an Advanced Wireless Services auction to set aside certain radio frequency spectrum exclusively for new entrants into the wireless telephone market. This was intended to foster greater competition in the Canadian wireless market, which was then comprised primarily of three companies.

Companies bidding for spectrum, including DAVE Wireless and Globalive Wireless Management Corporation (operating as WIND), were required to comply with a test of Canadian ownership and control required by the Telecommunications Act. During the 2008 spectrum auction, Globalive won 30 licences at a cost of $442 million. Industry Canada completed a Canadian ownership review and issued spectrum licences to Globalive in March 2009.

In July 2009, the Canadian Radio-television and Telecommunications Commission (CRTC) announced that it was reviewing Globalive's Canadian ownership in order to determine if it had complied with the requirement of the Telecommunications Act. On October 29, 2009, the CRTC announced that Globalive did not meet the requirements of the Telecommunications Act and that it could not be established as the fourth national cellular telephone company, primarily because the corporation's debt was controlled by a foreign company. On October 30, 2009, the Minister of Industry announced that he would review the CRTC decision.

During the period of the review by Industry Canada, from October 30 to December 11, 2009, the media reported that DAVE Wireless and Rogers Communications Inc. were potential "buyers and partners" for Globalive. Media reports indicated that Globalive had been approached by potential investors interested in helping that company finance its planned network and address the issue of Globalive's foreign owned debt that had arisen as a result of the CRTC review following the spectrum auction.

On December 11, 2009, however, a Government of Canada news release announced that the CRTC decision would be varied, enabling Globalive to "…enter the wireless telecommunications market without delay." The Minister of Industry stated: "Globalive is a Canadian company, and meets Canadian ownership and control requirements under the Telecommunications Act."

The True North Public Affairs Undertaking

The proposal by True North Public Affairs (TNPA) to DAVE Wireless described the proposed scope of work as follows: "Given DAVE Wireless' intention to reach key government influencers and decision-makers quickly in order to communicate the company's position regarding the CRTC decision and the prospect of related Government action, TNPA's effort will focus on:

  • identifying the Government officials that DAVE Wireless should meet;
  • arranging meetings with those officials; and,
  • preparing collateral material for the meetings."

The proposal indicated that Mr. Beardsley would act as the account manager and that he would be assisted by two other TNPA partners, Mr. Casey and Mr. Ruban. The fees proposed for this contract were $4,875.

A contract between TNPA and DAVE Wireless was agreed upon on November 20, 2009. DAVE Wireless engaged TNPA to arrange meetings with various public office holders, as early as November 23, 2009. As the account manager for the file, one of Mr. Beardsley's responsibilities included overseeing the execution of the contract and taking care of the processing and the administrative aspects of the file. Mr. Beardsley was also involved in identifying the public office holders that DAVE Wireless should concentrate its communications efforts upon.

TNPA's efforts on behalf of DAVE Wireless started on November 20, 2009 and lasted approximately two weeks. TNPA compiled a list of public office holders for DAVE Wireless to speak to or meet with and contacted dozens of public office holders. TNPA succeeded in arranging one meeting with the Director of Policy in the Office of the Minister of National Revenue. Mr. Beardsley's colleagues at TNPA, Mr. Casey and Mr. Ruban, were responsible for contacting public office holders and were properly registered as consultant lobbyists representing DAVE Wireless.

In addition to the work done on its behalf by TNPA, DAVE Wireless hired a consultant lobbyist who arranged at least one meeting for the company. DAVE Wireless also arranged meetings on its own behalf and registered its activities with the Office of the Commissioner of Lobbying.

Alleged arrangement of a meeting

On November 20, 2009, shortly after the contract by TNPA and DAVE Wireless had been approved by his clients, Mr. Beardsley telephoned Mr. Renze Nauta, who worked in the Prime Minister's Office (PMO). Mr. Beardsley knew Mr. Nauta from his previous employment at the PMO. At the time of the phone call, Mr. Nauta was the executive assistant to the Prime Minister's Chief of Staff, Mr. Giorno. Mr. Nauta was not available, and the call was answered by his voicemail system. Mr. Beardsley left the following message:

"Renze, Keith Beardsley here [telephone number and extension]2. I have John Bitove, B-I-T-O-V-E, former owner of the Raptors, and he would probably be well-known to Guy due to his Tory background and so on. Anyways, he is in Ottawa on Monday looking to talk about Globalive, the telecom issue and the CRTC. So because of his connections in Toronto, I just wanted to know if Guy wanted to meet with him quickly. He is obviously going to bring up the issue if he does meet with him but if you could get back to me and let me know. They are in the process of registering; they have not yet registered officially under the Lobbyists Registration Act. They are doing that today but that takes a couple of days to process, just so you are aware of that side of it. Anyway get back to me [telephone number and extension] or my cell [telephone number] talk to you later, bye bye."

When he was interviewed by the Investigations Directorate, Mr. Beardsley explained that his message was not an attempt to arrange a meeting. He explained that he was giving a "heads up" to Mr. Giorno that Mr. Bitove would be in Ottawa and that he would try to contact Mr. Giorno to discuss Globalive. Mr. Beardsley stated that, in his view, if his actions did constitute setting up a meeting, he had not done so intentionally or knowingly.

Mr. Beardsley indicated that he does not lobby, and that he had made every effort to stay away from controversy by respecting the five-year prohibition on lobbying. He stated that he had never set up meetings while engaged in his consulting work and that he does not call public office holders on his clients' behalf.

No other information indicating that Mr. Beardsley attempted to arrange meetings with other public office holders, or that he engaged in other registrable activities, was obtained during the investigation.

The Investigations Directorate determined that neither Mr. Giorno nor Mr. Nauta responded to the requests from Mr. Beardsley. In addition, it was found that the meeting proposed in the voicemail message did not occur.

At the time, Mr. Nauta and Mr. Giorno were "public office holders" as defined in subsection 2(1) of the Lobbying Act. As a result, the Investigations Directorate concluded that Mr. Beardsley undertook to arrange a meeting between a public office holder and Mr. Bitove, his client. This activity, when performed for payment and on behalf of a client, is a registrable lobbying activity under paragraph 5(1)(b) of the Lobbying Act.

The issue of payment

In 2008, Mr. Beardsley joined True North Public Affairs as a Senior Consultant to provide strategic advice. He was described by TNPA in biographical notes at the time of the undertaking in November 2009, as a partner in the firm and Mr. Beardsley identified himself as a partner at True North Public Affairs in correspondence sent to his client. He had the responsibilities of an account manager for the undertaking with DAVE Wireless and he was responsible for overseeing the execution of the contract.

As the Commissioner of Lobbying, I take the view that all members of a firm, whether they are partners, employees, or persons engaged under contract for services benefit from revenue generated by the firm. Therefore, any activity conducted on behalf of a client of the firm is deemed to be performed for payment.

The Investigations Directorate obtained a copy of the invoice sent by TNPA to DAVE Wireless and proof that payment was received by TNPA. The documents obtained indicate that, on December 17, 2009, TNPA received a payment of $5,118.75 ($4,875.00 + taxes) for services that were provided to DAVE Wireless.

On November 20, 2009, the date that Mr. Beardsley contacted Mr. Nauta seeking to arrange a meeting between Mr. Giorno and Mr. Bitove, he was employed at True North Public Affairs as a partner of the firm, and as an account manager for TNPA's undertaking on behalf of DAVE Wireless. In view of this, the Investigations Directorate concluded that when Mr. Beardsley undertook to arrange a meeting on behalf of DAVE Wireless, he did so for payment.

The five-year prohibition on lobbying activity

The Investigations Directorate examined whether Mr. Beardsley was subject to the five-year prohibition on lobbying activity in the Lobbying Act. On July 2, 2008, when the Lobbying Act came into force, Mr. Beardsley was employed in the Prime Minister's Office as a staff member. The position is one captured within the definition of designated public office holder in subsection 2(1) of the Act.

Mr. Beardsley ceased employment at the Prime Minister's Office on July 4, 2008. As a result, from that date he was subject to a five-year post-employment prohibition on lobbying activity under subsection 10.11(1) of the Lobbying Act. Therefore, he is subject to the prohibition on lobbying activity until July 5, 2013.

Conclusion

The Investigations Directorate concluded that, on November 20, 2009, Mr. Beardsley, for payment, contacted a public office holder in the Prime Minister's Office in an effort to arrange a meeting between the Chief of Staff in the Prime Minister's Office and Mr. John Bitove, the Chairman of DAVE Wireless. DAVE Wireless was a client of True North Public Affairs. In view of this, the Investigations Directorate concluded that Mr. Beardsley engaged in an activity deemed registrable pursuant to paragraph 5(1)(b) of the Act, while he was subject to the five-year prohibition on lobbying.

Registration

When the activities described in this Report took place, Mr. Beardsley was prohibited under the Lobbying Act from registering as a consultant lobbyist.


2 Telephone numbers and extensions have been removed by the Office of the Commissioner of Lobbying for reasons of privacy.