Judge tosses case against Philly lobbyist accused of misspending welfare grants

HARRISBURG - In a surprising move, a Dauphin County judge Thursday threw out charges against a well-connected Philadelphia lobbyist accused of misspending state welfare funds on fancy dinners, gym memberships, fresh-cut flowers, and $3,000 worth of line-dancing lessons for her staff.

District Judge Sonya McKnight offered no explanation for her decision to dismiss the case against Melonease Shaw, who has at times worked as one of the city's lobbyists in Harrisburg.

But during a preliminary hearing Thursday, Shaw's lawyers had argued that all of her alleged misdeeds fell outside the statute of limitations for the crimes with which she had been charged.

"It is so palpably clear that this person committed no crime and acted ethically and responsibly at all times," Shaw's lawyer Walter Weir Jr. said. "It is a great relief to be totally vindicated at this stage of the proceedings."

McKnight's ruling delivered an unexpected rebuke to the Attorney General's Office at what is normally a perfunctory proceeding at which prosecutors must show only that a defendant was more likely than not to have committed the alleged crimes.

It also brought an abrupt end to a case that tossed Shaw from the running for another city lobbying contract that she was pursuing at the time of her arrest in June.

Shaw declined to comment after the hearing as friends and supporters embraced her.

A spokesman for Attorney General Bruce Beemer said the office was reviewing its options. If prosecutors decide to try again, they could refile the charges and request a hearing before a different judge.

Shaw, 62, has long been a fixture in city Democratic circles. Since 2007, she has contributed more than $40,000 to party candidates for city and state offices and has counted State Rep. Dwight Evans (D., Phila.) and the late School Superintendent Arlene C. Ackerman as friends.

She has served on transition teams and government committees for Gov. Wolf and former Gov. Ed Rendell.

Clients of her lobbying and marketing firm, Maven Inc., have included SEPTA, Peco Energy, the School District, and SugarHouse Casino. The city awarded her $86,667 in lobbying contracts between 2010 and 2011.

But the case against her centered on her work as president and CEO of a now-defunct nonprofit agency, Transitional Work Corp.

The organization was founded in 1998 by the city, the state, and the Pew Charitable Trusts to provide job training and transitional employment to welfare recipients working their way off public assistance. Between 2007 and 2011, the year the organization shut down, it received $32 million in Department of Public Welfare grants.

But an audit by the state Office of the Inspector General found that Shaw had misused more than $307,000 during that period to purchase items not allowed under the grant - including expenses for her personal driver, fresh-cut flower delivery for her office, her membership at the Sporting Club at the Bellevue, and hotel stays in Philadelphia and at the Borgata in Atlantic City.

"She took welfare-to-work money that did not belong to her - that was meant to get people back to work - and she used it on flowers, food, a health-club membership at the Bellevue, hotels, dinners, and line-dancing," Deputy Attorney General Michelle Laucella said.

Weir balked at those claims, arguing that Shaw's nonprofit had been audited previously by city and state overseers, who did not take issue with the expenses.

More important, he pointed out, Shaw shut down the nonprofit in June 2011, whereas most of the expenses cited by prosecutors were in the years prior. The longest statute of limitations on any of the counts filed against her in June was five years.

"Melonease Shaw has a long-standing, fabulous reputation in the Philadelphia business community," he said. "We are at a total loss to understand why the commonwealth would have brought this case."

jroebuck@phillynews.com

215-854-2608 @jeremyrroebuck