Home>Articles>Exclusive: Gov. Newsom’s BYD Mask Deal Profitable for Insider Dealmakers

Governor Gavin Newsom at 2019 California Democratic Party State Convention at the George R. Moscone Convention Center in San Francisco, June 1, 2019. (Photo: Gage Skidmore)

Exclusive: Gov. Newsom’s BYD Mask Deal Profitable for Insider Dealmakers

Lobbyists don’t report procurement contracts, and gov officials stonewalling on public information

By Katy Grimes, May 28, 2020 6:28 am

New details are emerging about Gov. Gavin Newsom’s $1.4 Billion deal for masks with BYD, a Chinese electric bus maker that is now manufacturing N95 masks. However, during the height of the COVID-19 pandemic the deal has soured, as the masks failed to meet national safety and health standards.

The governor told media that the federal government held up his mask shipment, but in fact, the federal government said Newsom’s Chinese masks failed safety and health standards. The masks the Chinese company delivered failed to get the approval of the National Institute for Occupational Safety and Health. Standard surgical masks are also part of the order.

If that is not clear enough, this is the word salad that Brian Ferguson, the deputy director for crisis communication and public affairs for the Governor’s Office of Emergency Services, served to The Epoch Times on May 8: “The masks didn’t fail a test, but rather did not pass certification yet.”

BYD’s contract with the Newsom administration was kept hidden from state legislators and the media since the deal was struck in April, on the heels of the even stranger mask deal with Blue Flame Medical LLC – a company only recently formed by former political consultants seeking to capitalize on the coronavirus pandemic.

In March, California wired $456.9 million to Blue Flame Medical LLC for millions of masks. But once it was revealed that the state of California wired the nearly $500 million dollars for masks to a company that had been in business for three days, the state demanded its money back.

California Globe learned from a source that minutes after the money was wired to Blue Flame Medical LLC, the State Controller’s office received a call from the bank warning that the bank account the money was wired to had only been opened the day before.

As California Globe reported, the governor’s office initially refused to disclose either contract to lawmakers and journalists.

What was BYD offering that was different from Blue Flame, since neither company had any prior experience manufacturing masks, and why was the outlay of upfront money less with Blue Flame?

The Governor’s BYD $1.4 billion contract is looking like well-connected insider trading.

The Build Your Dreams company, BYD, is based in Shenzen, China. The electric bus manufacturer has a California subsidiary in Lancaster, where it employs 1,000 people.

California Globe has uncovered a trail of well-connected players in the odd $1.4 billion mask deal which seems to lead up to the cabinet level inside the governor’s office.

The prominent lobbyist who represents BYD is Mark Weideman of The Weideman Group. The governor’s campaign received $40,000 from BYD’s automotive division.

Weideman also represents Bloom Energy, a fuel cell manufacturer in San Jose, which recently retooled its facility to rehabilitate ventilators for COVID-19 patients.

Weideman also represents NextGen America, owned by Tom Steyer, Newsom’s economic recovery committee chairman whose failed presidential campaign petered out in late February.

California Globe called and emailed Weideman to ask about the BYD contract. A phone call placed to his office at 1:07 pm May 19, 2020 did not receive a response. A follow-up email sent to Weideman via his company website May 25th also did not receive a response.

Mark Weideman’s wife is Jennifer Wada, an attorney who now has a government relations business – Wada Government Relations Group. It is not common knowledge even among Sacramento insiders that Wada and Weideman are married.

Wada previously was a partner in Wada, Williams Law Group. Her former law partner is Anthony Williams, who is now Gov. Newsom’s Legislative Affairs Secretary, although news reports from 2018 also called Williams Newsom’s “chief lobbyist.”

Anthony Williams was a senior adviser for former Democratic state Senate leaders John Burton and Darrell Steinberg, and lobbied for the Judicial Counsel of California and the State Bar.

A source said the governor was able to pivot so quickly from the bad Blue Flame Medical deal to BYD because of the connections between Weideman, Wada and Williams.

In the email California Globe sent, we asked Weidemen about these close connections, and if the deal came together because of Weideman, Wada and Williams.

“Newsom and his aides singled out BYD-America, which manufactures electric buses in Lancaster and has been a beneficiary of California’s efforts to combat climate change,” CalMatters reported April 8, 2020. “Mark Ghilarducci, Newsom’s director of the Office of Emergency Services, said BYD has a direct reachback into China to be able to build a sustainable amount of monthly masks that will be coming in to assist us.’”

BYD America is a subsidiary of BYD China.

As for “Gov Newsom and his aides singled out BYD-America…” Anthony Williams is one of Newsom’s top level aides, as this organizational chart of the governor’s office shows (Williams is at the far right, below First Partner Jennifer Newsom’s staff).

Governor Gavin Newsom’s office organizational chart. (gov.ca.gov)

Procurement Payola: the Financial Incentive

Lobbyists are allowed to take a percentage of procurement contracts they are involved with, which can run as high as 15-20%, according to a source. With all of the other financial disclosures lobbyists are required to report, a lobbyist clarified for us why the procurement deals are not required reporting: When lobbyists are attempting to influence legislation or lawmakers, financial disclosures are required. Procurement deals and contracts are not influencing legislation or lawmakers, therefore, these deals are not reportable.

Did Anthony Williams, Gov. Newsom’s “chief Lobbyist” and Legislative Secretary, facilitate the BYD deal? Did he receive a cut of the deal? California Globe placed two phone calls to the Governor’s office to speak with Williams, but did not receive a response back. The first call on May 22 went unanswered. The second call on May 27, 2020, was answered after 14 minutes on hold, at 10:27 am. The receptionist said she would not transfer the call to his voicemail, and suggested emailing Mr. Williams’ assistant Tammy Trinh. The email to Anthony Williams’ assistant was sent at 10:48 am. The Globe has yet to receive a reply to any of these inquiries.

“Although the company, BYD, is a major global player in the electric vehicle and lithium battery markets, it also has glaring red flags on its record, experts warn, including a history of supplying allegedly faulty products to the U.S., ties to the Chinese military and Communist Party, and possible links to forced labor,” Vice reported. “BYD also has no history of making personal protective equipment, and yet days after the FDA approval, it secured a $1 billion deal to supply masks to California.”

When Gov. Newsom made the deals to purchase $1 Billion worth of masks from BYD, it was “to combat a growing need for masks in California and to secure them before other states and countries sign similar deals,” California Globe reported.

The question is “Why did he make this deal?”

“The number of COVID-19 deaths have been much less than the 750 total deaths that occur every day in California,” Epidemiologists James Enstrom and Jeffrey Klausner said in an Orange County Register article mid-April. “Furthermore, there is evidence that there have been substantial reductions in the deaths due to seasonal flu, pneumonia and accidents because of the almost exclusive focus on COVID-19 and the current statewide lockdown.”

California Globe, with help from Dana Point Attorney Craig Alexander, filed California Public Records Requests in April with Gov. Gavin Newsom and the involved agencies for the contract the governor made with Chinese company BYD for 200 million surgical masks. Office of Emergency Services eventually made the contract public.

We will continue to report on this topic as details emerge.

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21 thoughts on “Exclusive: Gov. Newsom’s BYD Mask Deal Profitable for Insider Dealmakers

  1. Well done as always Katy.
    For those who never heard of BYD:
    When Chinese battery maker BYD Ltd. approached Southern California officials in 2008 touting ambitious plans to build electric cars, local politicians jumped at the promise of thousands of jobs and cleaner air.

    In the nine years since, agencies have awarded BYD grants, subsidies and public contracts worth more than $330 million for its battery-powered buses, forklifts and trucks. The company is positioned to be a prime supplier of electric buses to the nation’s second-largest system, as Los Angeles’ Metro sets a 12-year deadline to abandon fossil fuels.

    But largely unbeknownst to the public, BYD’s electric buses are contending with a record of poor performance and mechanical problems.

    A Times investigation found its buses stalled on hills, required service calls much more frequently than older buses and had unpredictable driving ranges below advertised distances, which were impaired by the heat, the cold or the way drivers braked.

    A federal testing center and transit agencies across the country logged driving ranges that were dozens of miles short of company claims, limiting the routes they can handle and requiring passengers to shuffle onto replacement buses when the batteries go low.
    Continued: https://www.latimes.com/local/lanow/la-me-electric-buses-20180520-story.html

  2. Excellent reporting Katie!
    Thank you for staying on top of this.
    It is seems to be quite a tangled web that needs to be unraveled!
    It would be nice if a Federal probe could be conducted! If ever there was a time for the DOJ to be involved it would be now!

  3. Wow! What a report. Excellent. Thank you, thank you, Katy Grimes, for connecting the villain dots and supplying motives backed up with facts about this extremely odd and very expensive transaction that apparently the players thought they could get away with while hiding behind masks. With OUR money, of course. $$Money, Money, Money$$ — what else is there for these people? Oh yeah, also the power that will never begin to satisfy their megalomania.
    Looking forward to the next installment.

  4. Thank you Katy. If the main stream media took their job as seriously and with the dedication that you and your colleagues do this, country would be more informed and would be able to see that these people have to go.

  5. Good job as always, Katy… You must be the only investigative reporter left in the United States – none of this was mentioned in any of the “mainstream” media outlets.

  6. I just stumbled on the Globe today this is the first article i read Great Job Katy and I am looking forward to
    this kind of reporting from the Globe and I will be speading the word to my freinds.

  7. Thank you for true reporting! The web is big..keep us informed so we can remove these corrupt and evil people.

  8. Thank you for your reporting, Katy. I’ve been saying – don’t go after Newsom on irrelevant social nothingburgers. Go after him on corruption and organized crime. San Francisco is a pay to play city and he’s brought it to Sacramento. We also need to look at whether BYD has any influence at CalPers – I suspect it does

  9. Finally, something that might finally awaken people to the corruption and malfeasance perpetrated by Newsom, Becerra and Padilla…
    Hopefully the DOJ will get involved and remove these corrupt individuals, or if not, cause the people to rise up against these crooks to have them recalled from office and thrown in prison where they belong.
    Fraud, illegal deals, voting improprieties, the list grows ever longer….
    Recall Newsom
    Recall Becerra
    Recall Padilla
    Remove corrupt California politicians!!!

    1. Thank you Ms Grimes – for your diligent investigations. It’s too bad fake news won’t carry these nuggets. They could regain their credibility – but … no way.

  10. Thank you Ms Grimes – for your diligent investigations. It’s too bad fake news won’t carry these nuggets. They could regain their credibility – but … no way.

  11. Fantastic Work!
    Too bad our corrupt justice system from federal to local is not a noble as you!
    You should be getting all of their salaries, since you are doing all the work for them!
    As big a deal as this is, the really BIG deal is that this The virus fraud, Lockdown etc. was the “Big” Bourgeois revolution to finalize the install of their TEXTBOOK Kerensky-Konovalov Bourgeois Dictatorship,…. the criminal empire. This stuff will only get worse from here. The constitution was flushed in the toilet paper run…

  12. Great article! Thanks for giving the little guys in CA (you know; the ones who employ others and earn tax revenue) for an opportunity to do this. We currently manufacture over a million masks per week in California, and can’t even get a call back. China for the win I guess

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