Oregon DOJ levies fresh allegations over local officials’s data center ‘scheme’
The Oregon Department of Justice has filed an amended civil complaint against Morrow County officials, alleging they conspired to acquire Windwave Technologies, a key Amazon data center vendor, for a fraction of its true value. The complaint claims officials hid Windwave's significant business with Amazon from appraisers and state watchdogs. Defendants deny the allegations, asserting the transaction was approved by the DOJ in 2018.
The Oregon Department of Justice (DOJ) has escalated its civil case against several current and former Morrow County officials and associates, filing an amended complaint that outlines new allegations regarding the acquisition of Windwave Technologies, a critical fiber-optic vendor to Amazon's data centers in the region. The DOJ claims these officials, who also served on the board of the nonprofit Inland Development Corp. (Inland), conspired to purchase Windwave for $2.6 million in 2018, significantly less than its alleged true value of at least $9.5 million. The complaint accuses the defendants of concealing Windwave's burgeoning business with Amazon from an outside accounting firm, Cogence Group, and state watchdogs during the transaction.
The scheme, which dates back to 2016, involved five buyers—Jerry Healy, Marv Padberg, Don Russell, Gary Neal, and Blake Lawrence—all of whom served on Inland's board, with all but Lawrence also holding public office in Morrow County at the time. They are accused of arranging the sale to themselves without a public bid, despite their roles in facilitating land sales and tax breaks for Amazon's data center expansion. The amended complaint further implicates associates appointed to Inland's board, including state Rep. Greg Smith, who is alleged to have advised "shredding" unfavorable documents related to the deal.
Windwave's owners, through their attorney, deny the allegations, asserting the company's success resulted from their diligent work and that the DOJ had approved the 2018 transaction. They claim uncertainty regarding future Amazon business at the time of sale. However, state records obtained by The Oregonian/OregonLive reveal Windwave's business with Amazon quintupled from $7.3 million in 2018 to $38.5 million by 2021, with Amazon paying Windwave over $100 million between 2019 and 2022.
Circuit Court Judge Thomas Powers previously denied a motion to dismiss the case, ordering the state to provide specific allegations against Inland's board members, which the new complaint addresses. Amazon, while not a defendant, has consistently denied wrongdoing and refused to comment on its awareness of the officials' ownership in Windwave. The DOJ's civil case seeks monetary relief, as the statute of limitations for criminal charges has expired, and awaits a trial date.