Former Gov. Phil Bryant’s intent to accept stock in a pharmaceutical company that had received hundreds of thousands of federal funds from the welfare agency he controlled was a topic of conversation at his final Christmas party at the Governor’s Mansion, a recent court filing alleges.

Nancy New, the nonprofit operator pegged as a ringleader of the ever-unfolding Mississippi welfare scandal, has again alleged through new details in a court filing that Bryant was behind some of the spending that officials have called the largest public embezzlement scheme in state history.

Mississippi Department of Human Services’ current civil complaint — the state government’s legal effort to recoup misspent welfare funds — accuses New of meeting with Bryant’s appointed welfare director at former NFL quarterback Brett Favre’s house in early 2019 to discuss a “substantial stock investment” in the pharmaceutical startup.

New began funneling grant funds through her nonprofit Mississippi Community Education Center to the drug company, called Prevacus, in the following weeks. State prosecutors originally accused New in 2020 following a state auditor’s investigation of embezzling welfare money in order to make personal investments in Prevacus. In 2022, she instead pleaded guilty in state court to three counts of wire fraud related to the payments, since Prevacus was “known to be ineligible to receive such public grant funds.”

But in her Monday filing, New states that “the only ‘substantial stock investment in Prevacus’ that I am aware of is the one Governor Bryant told me about during a Christmas party at the Mansion in 2019.”

Around the time of the party, Prevacus founder Jake Vanlandingham had been talking to the governor about “bring(ing) you onboard with ownership,” according to texts Mississippi Today first published in a 2022 investigation “The Backchannel.”

“The Governor had been funding Prevacus through MDHS and MCEC for about a year,” New’s latest filing states, “so it was not unusual for Brett, or Jake, or Prevacus to come up in conversations with the Governor. At the Christmas party, Jake’s name came up. Governor Bryant got excited and told me that Jake had offered him ‘half the company,’ which I understood to mean a substantial amount of stock, but the Governor said he was going to have to wait until he was out of office to accept.”

Bryant’s alleged involvement in the scandal is important to New’s defense, which relies in part on the fact that as a contractor of the agency, her nonprofit was acting in accordance with the state’s directives.

Vanlandingham first reached out to New in late 2018 shortly after meeting with Bryant about locating a drug manufacturing operation in the state. By this point, New’s nonprofit Mississippi Community Education Center had been receiving tens of millions of federal grant funds from Mississippi Department of Human Services, an agency under the purview of the governor’s office.

New had already used some of the funds starting in 2017 to fund the construction of a volleyball stadium at University of Southern Mississippi — another project promoted by Favre and directed by Bryant, according to New. When New and Favre initially hit a snag pushing the needed funding to the volleyball stadium, for example, “Governor Bryant called me and said he liked the volleyball project and wanted me to provide the additional funds that Brett needed,” New’s filing this week reads.

Bryant has denied directing welfare spending on either project or agreeing to accept stock in the drug company. Citing a gag order in the state’s civil case, Bryant’s attorney declined to comment to Mississippi Today for this story. The former governor is not facing civil or criminal charges.

On the call in late 2018, Vanlandingham told New that “he, Brett Favre and Governor Bryant were working together to fund a concussion drug company called Prevacus. Jake knew that Governor Bryant, (then-MDHS director) John Davis and I had funded the volleyball facility/wellness center at USM through MDHS and MCEC,” the filing reads.

Prevacus was looking for $750,000 to complete the first phase of drug trials, New said, plus $1 million more down the road. New said she agreed to relay the message to Davis, Bryant’s appointed welfare director. New alleged that Davis then spoke to Bryant and, after the conversation, agreed to meet with Vanlandingham.

Davis’ calendar entry for the meeting, first obtained by Mississippi Today in 2020, recorded that, “This meeting was requested by Brett Favre and the Governor to discuss the Educational Research Program that addresses brain injury caused by concussions. They also want to discuss the new facility at USM.”

New, Davis and his close associate, former WWE wrestler Ted “Teddy” DiBiase Jr., traveled to Favre’s home outside of Hattiesburg on a stormy day in early January of 2019.

“I understood the purpose of the meeting was for John to hear about Prevacus, so he could decide whether MDHS should provide funding. I later learned the decision to fund Prevacus through MDHS had already been made,” New’s latest filing states. “After the meeting, I asked John why he had committed so much funding so quickly. John said he had spoken with Governor Bryant and the Governor wanted Prevacus funded. John said the Governor was ‘all about this happening.’”

New’s filing also alleges Bryant instructed Davis to fund the volleyball stadium project. The federal government prohibits states from using welfare funds on brick-and-mortar, so the welfare agency began creating expensive subleases that they said would allow them to conduct programming at various properties, but more importantly, would allow for them to conduct high-dollar renovations or builds. The volleyball project was not the first time this idea was raised.

“Governor and Mrs. Bryant wanted a ‘palliative care’ center built in Jackson, Mississippi, so MDHS created a lease structure to use grant funds to pay for construction,” New’s filing reads.

Forensic auditors found that this lease was never executed, but it appears the lease arrangement was utilized later for the USM facility.

Davis has not commented publicly about the circumstances surrounding Prevacus and the volleyball stadium projects. While Davis pleaded guilty in 2022 to two federal charges and 18 state counts of fraud or conspiracy related to the scandal, each count pertained to payments made to benefit former professional wrestlers Teddy DiBiase and his younger brother Brett DiBiase — not regarding the Prevacus or volleyball projects. Davis has not been sentenced.

Following the January 2019 meeting, Vanlandingham thanked Bryant and said that he was excited to be working with the agency and nonprofit directors. Once New began sending payments to Prevacus, Favre briefed Bryant, texting the governor, “We couldn’t be more happy about the funding from the State of MS.”

Bryant continued to consult with Vanlandingham and Favre about advancing Prevacus’ development through 2019 and after leaving office, at which point he promised to “get on it hard.”

New’s account that Bryant opted to wait until he left office to accept a company package in Prevacus is consistent with his own text messages. After Vanlandingham offered to bring Bryant on with ownership in early December of 2019, Bryant responded, “Cannot till January 15th,” Bryant wrote, referring to his first day out of office.

“But would love to talk then,” Bryant added. “This is the type of thing I love to be a part of. Something that save lives…”

On Jan. 16, 2020, Vanlandingham texted Bryant, “Now that you’re unemployed I’d like to give you a company package for all your help,” to which Bryant responded, “Sounds good.”

Bryant told Mississippi Today in an April 2022 interview that he ended his business relationship with Prevacus on his own accord before the initial arrests. But his texts show he kept discussing when and where to meet with Vanlandingham all the way up until the day before the arrests and only discontinued the conversations after reading Prevacus’ name in the 2020 indictments.

Since her arrest in 2020, New has mostly refrained from commenting publicly on the case or offering her side of the story, with the exception of material that appears in documents gathered through discovery. The personal accounts in New’s latest filing may reflect what she is prepared to offer in upcoming depositions or trials — such as the exchanges she witnessed that may not appear in written communication.

New has not been sentenced and is a cooperating witness in the ongoing federal criminal investigation.

This article first appeared on Mississippi Today and is republished here under a Creative Commons license.