Another Trump scam in the works
By Justin Elliott, Robert Faturechi and Alex Mierjeski in ProPublica
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| By Dave Whamond |
This month, former President Donald Trump’s media company announced it was making its first major purchase: technology to help stream TV on Truth Social, its Twitter-like platform.
There was a mystery at the center of the deal: One of the companies on the other side of the transaction, which went unmentioned in Trump Media’s press release but was named in securities filings, is an obscure entity called JedTec LLC.
Based in a North Louisiana village, the company has virtually no public footprint and no website, and it is unknown to streaming technology experts.
Interviews and public records reveal that the man behind JedTec is Louisiana energy magnate James E. Davison. A major Republican donor, he is known for his immense influence in state and federal government, including personal friendships with past presidents, and for using his wealth to benefit people in politics.
The acquisition will put Trump’s company in a business relationship with someone with numerous interests before the federal government. Davison, for example, owns a major stake in Genesis Energy, a large oil pipeline and mining firm. A trade group representing Genesis and other publicly traded pipeline firms previously lobbied the Trump administration and lawmakers for a tax break and on environmental issues. Davison’s family also has a stake in a regional bank and owns a small defense contractor. And Davison could benefit if the 2017 Trump tax cut provisions, which expire after next year, are extended.
Davison also has a record of influence with the Trump White House, successfully leveraging connections there in 2019 to win a $17 million federal grant to build roads, according to one Louisiana official.
The streaming deal crystalizes the sort of conflicts that Trump’s business interests pose as he vies for a second term.
Before his first term, Trump rejected calls to divest from his business. Trump’s years in the White House were marred by controversy as political groups and foreign governments spent millions of dollars at his properties.
But his stake in Trump Media, created after he left office, has the potential to eclipse those concerns. His shares of the company, a meme stock that has soared despite the company generating almost no revenue, are valued at more than $3 billion. That makes up more than half of his estimated net worth. Ethics experts have warned that advertisers, vendors or investors who have political agendas could try to use Trump Media to curry favor.
The deal with Davison poses just that potential for undue influence, said Virginia Canter, a former government ethics lawyer.
It could give Davison access to a future president and an advantage in extracting favors from Trump, Canter said. “It puts them in a more favorable position to get their perspectives before the president or other members of his administration.”
The Trump Media deal suggests an ongoing business relationship between the companies: It calls for the full price — roughly $170 million in cash and shares, at the stock’s current value — to be paid out based on a series of milestones. It’s difficult to assess whether the price being paid by Trump Media is fair because the companies involved are little known in the industry and the filings don’t offer much detail about the technology and services they’ll be providing.
Filings don’t disclose what portion of the purchase price will go to JedTec, the Louisiana company involved in the deal. Business records show Davison as the person behind JedTec. And interviews and records show that Davison has a longtime relationship with one of Trump Media’s board members. But in a brief call with ProPublica, Davison denied he personally played a role in the sale, before hanging up.
“I’m not really involved with that,” he said. “I haven’t been part of it.”
Davison didn’t respond to follow-up questions sent in writing.
Trump hasn’t said whether he would divest from Trump Media & Technology Group if elected, but his spokesperson has said he would “follow ethics guidelines.”
A Trump Media spokesperson declined to answer detailed questions about the deal with Davison, saying that the company “believes its partners can deliver the best technology for TMTG’s platform, encompassing a unique, uncancellable tech delivery stack for streaming.”
The spokesperson also suggested that the company might take legal action in response to this article: “The assertions and insinuations in this story, including of any ethical improprieties whatsoever or any material omissions from TMTG’s disclosures, are false, defamatory and a textbook example of a fake news story that will land the left-wing shills at ProPublica in court.”
Davison turned down a job offer out of college, instead helping his father at his small trucking company in rural North Louisiana. Over the years, he transformed the company from a two-truck operation to one with hundreds of trucks, hundreds of employees and business lines across the energy industry, including petroleum storage, fuel procurement and refining operations that removed sulfur from sour gas streams.
As Davison’s business empire grew, so too did his political influence.
In Louisiana, he is known as a philanthropist for local institutions and is considered a political kingmaker. “Members of Congress, governors, state lawmakers, they’re sitting in front of him asking for his support, asking for his advice, asking if they should run or not,” said Rick Hohlt, former publisher of the Ruston Daily Leader, the newspaper for Davison’s hometown. “He’s a powerhouse.”
His influence extends beyond Louisiana. Davison, now 86, has counted presidents as friends, including both Bushes. He would “refer to presidents by their number,” one associate recalled. “‘I was spending time with 41 the other day.’” Davison helped lead fundraising efforts in the state for Jeb Bush’s 2016 presidential campaign.
In 2019, when Trump was president, the mayor of Ruston credited Davison’s influence with the White House for securing the $17 million federal grant to build roads in the city. “He is well connected in D.C. He knows everybody that’s a player,” the mayor, Ronny Walker, said in an interview with ProPublica, adding that he flew with Davison on the businessman’s private jet to Washington for lobbying trips.
Davison has donated an estimated $3 million to federal Republican candidates and causes in the last decade, including more than $90,000 to Trump committees for his previous two campaigns.
Davison’s connections to people in politics have sometimes raised ethical questions. Last year, after the state’s now-governor was questioned about not disclosing private flights provided by campaign donors, the state Republican Party disclosed several such trips, including from Davison. In 2014, a Louisiana congressman’s chief of staff was arrested for driving drunk. The aide was reportedly driving a Mercedes registered to one of Davison’s businesses.
Davison’s business interests are vast. In 2007, Genesis Energy, a Houston-based pipeline company, bought Davison’s trucking company and other businesses in a deal worth about $560 million. The Davison family got a large stake of Genesis as part of the deal, and both Davison and his son are on its board.
The trade group that represents publicly traded pipeline businesses including Davison’s lobbied during the Trump presidency on its signature tax legislation. The industry won a carveout in the 2017 legislation that allowed its investors to get a large tax break.
That tax break is set to expire after 2025, when Trump, if he wins the election, would be in his second term. Trump has promised to extend the tax law.
Genesis Energy’s agenda is not limited to taxes. Its operations are regulated by the Environmental Protection Agency, and its fortunes can hinge on who’s in the White House. In a public filing, the company credited Trump with easing regulations related to the Clean Air Act, including on methane emissions for oil and gas companies. President Joe Biden, the company noted, restored those regulations.
When Trump Media announced the streaming TV deal July 3, the company said its plan is to host news shows and religious channels at risk of “cancellation.”
“We are rapidly pushing forward with our plans to launch a high-quality streaming service that we believe cannot be canceled by Big Tech,” CEO Devin Nunes said.
The deal announced by Trump Media involves a series of largely unknown small players. Trump Media’s disclosures about the deal describe a nesting doll of companies that leave many questions unanswered about its new business partners.
The sellers include a pair of Louisiana companies: Davison’s JedTec LLC along with another called WorldConnect IPTV Solutions.
The ultimate provider of the technology is a British firm called Perception Group, which has offices and engineers in Slovenia. The clients listed on its website are far less prominent than Trump’s social media site. They include a telecom in Slovenia, an entertainment service for crews on commercial ships and an Arabic-language streaming service in Sudan.
JedTec does not have any online footprint. Davison, in the brief phone interview with ProPublica, acknowledged he knew about the deal but said WorldConnect was behind it.
Industry experts said they had never heard of WorldConnect. The phone numbers listed on WorldConnect’s website are disconnected. The most recent press release was eight years old. One item from 2012 celebrated China Central Television, the Chinese government’s propaganda channel, launching on a streaming platform in the United Kingdom. WorldConnect listed just seven staffers on its website. (Hours after ProPublica sent the company and its executives questions, the company website was taken down entirely.)
Both its CEO, Dr. Jarrett Flood, and president, Von Boyett, are serial entrepreneurs.
In his biography, Flood describes himself as being “trained as a medical doctor and critical thinker.” Flood’s social media pages list other roles including owner of a medical center and Flood International Consulting Agency. (It’s not clear where Flood went to medical school, and searches in medical license databases for his name turn up no results.)
Boyett says in his biography he has decades of experience in multiple industries: petrochemicals; telecoms; medical equipment; and product sourcing. He cites working with Russian state energy giant Gazprom in the 1980s and brokering the Soviet Union’s first foreign TV programming deal.
Boyett and Flood are also named as executives in another company that lists just five employees but says on its website it is involved in a dizzying array of businesses, including purchasing power plants, medical technology, education and solar energy.
Boyett and Flood did not respond to requests for comment.
The Trump Media spokesperson said that the company had done “extensive beta testing and due diligence” for the deal.
A person familiar with the history of WorldConnect told ProPublica that the company entered into a joint venture with Davison in 2017 to buy the rights to sell Perception’s TV technology in the United States. Davison put up most of the money for the deal, the person said.
Both companies are private, so their finances and the details of their ownership are not public.
How Davison got involved in the Trump Media deal is unclear. But even before the deal was announced, he did have one clear link to the company.
Trump Media’s board is composed almost entirely of high-profile allies of the former president, including his son Donald Trump Jr. and former cabinet members in his administration such as Linda McMahon and Robert Lighthizer.
One board member who does not fit that profile is W. Kyle Green, a lawyer from the Ruston area with a much more modest background. According to his Trump Media biography, he runs his own small law firm. Previously, he served as Ruston’s city prosecutor for eight years “where he successfully prosecuted more than 20,000 criminal defendants.” (A longtime district attorney in the area told ProPublica that a tally of prosecutions that enormous in a city with a population of just over 20,000 likely included traffic tickets, which is in line with the kind of low-level issues that office handles.)
Green is Davison’s lawyer, Davison’s wife told ProPublica. He’s listed as the registered agent on state business filings for JedTec, and he did the legal paperwork to create the LLC in 2017. If Green has an ownership stake in JedTec, or plays a significant role in the company, Trump Media may have been required to disclose his connection in public filings. The company didn’t do this.
Green didn’t respond to requests for comment.
Trump Media’s streaming deal could close as early as this month. In filings, the company said it expects to pay up to 5.1 million shares of stock — about $150 million at current market value — plus $17.5 million in cash. Its payment to the companies involved will be staggered, with roughly half of the stock in the deal — more than 2 million shares — delivered only when the streaming software is implemented at greater and greater scales.
Do you have any information about Trump Media or its partners that we should know? Justin Elliott can be reached by email at justin@propublica.org or by Signal or WhatsApp at 774-826-6240. Robert Faturechi can be reached by email at robert.faturechi@propublica.org and by Signal or WhatsApp at 213-271-7217.
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