Pittsburgh Sues Newport Firm in Bribery Scandal

The City of Pittsburgh has filed a multimillion-dollar lawsuit against the operators of an apparently defunct Newport Beach computer firm that has been at the center of a highly publicized statewide corruption scandal in Pennsylvania.

The lawsuit, filed by the city last month but sealed until Thursday, charges that John Torquato Jr., head of Computer Technology Associates, and two other CTA officials attempted to corrupt state and local officials who could help them win lucrative government contracts in Pennsylvania.

Torquato, the alleged mastermind of the scheme, is serving a four-year term in a federal penitentiary after pleading guilty to conspiracy in a plea bargain in December, 1984. He had been charged with attempting to bribe Pennsylvania state officials for $400,000 in exchange for contracts with the state.

The suit filed by Pittsburgh alleges violations of federal anti-racketeering statutes against Torquato, former CTA attorney Alan R. Stoneman, former CTA chief executive officer Judy Ellis and David I. Herbert, former director of the Pennsylvania Bureau of Social Security for public employees.

Stoneman and Torquato’s Pennsylvania lawyer, William Smith, co-chairman of the Republican Party in Dauphin County, were convicted in a three-month trial on charges stemming from the bribery scandal that landed Torquato in prison. They are appealing. Ellis and Herbert pleaded guilty in the criminal case, but neither is now in custody.

In its civil suit, the city is seeking treble damages totaling almost $500,000, plus $1 million in punitive damages from each individual and from the corporation.

It also seeks a refund of $150,000 “fraudulently secured” by CTA in a 1984 contract calling for the company to recover $644,600 in Social Security overpayments for the city. The city also wants a refund of the $14,500 it spent to correct mistakes it claims were made by CTA.

It was unclear Friday if CTA or its parent company, XET Ltd., still is in business. Neither company is listed in the telephone directory and information operators have no listing on file.

According to federal prosecutors, the CTA scheme involved attempts to win government contracts through offers of jobs, favors and cash. CTA eventually won contracts with Pittsburgh, Allegheny County and the state.