Albert Moriarty donated $625,000 to Cal Poly in 2009 to pay for the scoreboard in Alex G. Spanos Stadium. Since then the 80-year-old has filed for bankruptcy and been the target of more than a dozen lawsuits.
While Albert Moriarty sits in the San Luis Obispo County Jail, as he has for the past eight months, the name of his now defunct business, Moriarty Enterprises, still graces the top of the scoreboard in Cal Poly’s Alex G. Spanos Stadium.
Now Cal Poly finds itself in a legal battle over hundreds of thousands of dollars Moriarty donated to the university that might not have been his to begin with.
The Cal Poly alumni and booster gave the school $625,000 in April 2009. The money funded the stadium’s electronic scoreboard and guaranteed him the naming rights in a gift contract with the school which called Moriarty “an important leader with the Cal Poly Athletics Family.”
Since then, Moriarty, 80, has filed for bankruptcy and has been the target of more than a dozen lawsuits by San Luis Obispo residents who want their money back. Authorities arrested Moriarty in spring on charges of securities fraud.
Cal Poly legal counsel Carlos Cordova said the school first became aware of Moriarty’s circumstance last spring, after they received a claim from bankruptcy creditors asking for the full amount of his donations back.
“They claim they are entitled to the money,” Cordova said. “Basically, we disagree.”
Cordova said the university has been in discussion with the creditors.
One idea is for Cal Poly to try and buy the rights for the scoreboard back.
“At that point, we would then have the ability to take the name off,” Cordova said. For now, Cal Poly would be in “breach of contract” if it removes Moriarty’s name from the scoreboard.
The situation Cal Poly faces is rare, but it’s not unheard of. Yale University was asked in 2009 to recover a $1.7 million gift after its donor was jailed on charges related to insider trading. Yale agreed to pay $1 million in a settlement.
It has been one year since Moriarty first filed for bankruptcy in the state of Washington, where he was arrested five months later and transferred back into San Luis Obispo County.
“Since we have parties in a different state, this is a very unique situation that seems to be dragging out longer than usual,” Cordova said. “Our goal is to get a resolution that is acceptable to everybody.”
According to Cordova, a new agreement must be reached before Moriarty’s name can be removed from the scoreboard.
“We can’t have that conversation with Moriarty because he no longer owns the contract,” Cordova said. “It’s now owned by the bankruptcy trustee.”
In addition to the 19 civil suits filed by former clients of Moriarty, he faces criminal charges that include securities fraud, scheming to defraud and selling securities without a license. He is being investigated by county and federal prosecutors, but has maintained innocence. He plead not guilty at his arraignment on Nov. 19.
In light of the turned circumstance, Cordova said Cal Poly regrets not having a different type of contract.
“He has a long standing with the university, and quite frankly, we did not envision this scenario ever occurring to him,” Cordova said. “In light of that, I think the university had a pretty bare bones understanding with him.”
Moriarty graduated with a degree in physical education in 1957. During his time at Cal Poly, he played football for four years and spent his freshman year on the undefeated team of 1953. He also met his wife, Patty, a former drum major, while the two attended school.
In a 2009 promotional article published by Cal Poly Athletics near the time of Moriarty’s donation, he said it was during his junior year at Cal Poly that he began his former financial services business, Moriarty Enterprises.
“Look what we have to sell. We live in an area that’s beautiful and Cal Poly has everything going for it,” Moriarty said at the time. “You’d be smart to get involved with Cal Poly.”
Moriarty’s history with the athletics department goes back at least to 1992, when he was first asked to work on behalf of the Mustang Athletic Fund and became the group’s first president. He was admitted into Cal Poly’s Hall of Fame 10 years later, and served the school as recently as February of 2011 — just 10 months before he filed for bankruptcy — when he helped to evaluate potential athletic directors.
Did Moriarty give other funds to the school during his decades as a prominent figure in the athletics department? Cal Poly isn’t saying.
When asked if Moriarty had made any other donations to the school, university spokesperson Matt Lazier said, “The only donation from Mr. Moriarty that the university has discussed and will discuss publicly, is the $625,000 gift for the stadium scoreboard.”
In the 2009 promotional article, Moriarty said, “I’m a great forecaster and I see big things for this school.”
But according to Cordova, the school could have afforded to be more thorough at the time of the scoreboard agreement. The contract could have been labeled and written better, he said.
“It’s not really a donation, it really should have been called a sponsor agreement,” Cordova said. “We have them all the time — a sponsor gives us money and we agree to put their name on a sign.”
Cordova said the school will include provisions in future agreements to address these types of situations.
“We already have steps in place to make sure the next agreements spell out the understandings better than what happened here in this particular case,” he said.
During the handful of court dates Moriarty has had during the past two months, he has switched lawyers and tried to fight bail. He swapped out the public defender appointed to him for a lawyer he met behind bars during his time in county jail.
Some of his alleged victims have attended the proceedings and filled the audience as his requests to reduce his $5 million bail were denied.
According to the San Luis Obispo District Attorney, Moriarty’s next court date will be on Feb. 4, where officials will set a date for his trial.