Tuesday, June 24, 2008

Public Entities fleecing taxpayers to avoid responsibility for wrongdoing

From Voice of San Diego
All Those Legal Bills
By Tom Adler, San Diego
Tuesday, June 24, 2008

I was delighted to read that the city council has finally come to their senses and has begun to balk about paying for outside consultants.

It does seem a bit ironic however.

During their pension dustup the council members couldn't get enough of them. Council member Jim Madaffer, for instance, had no trouble at all in March 2006 requesting that the taxpayers of this city pay his personal attorney a sum of $327,231. These attorney fees were supposedly incurred to enable Mr. Madaffer to get advice from an attorney as to whether he had violated any laws in regard to the pension debacle. In more than 30 years as a lawyer, I never knew anyone who paid this amount to get advice from an attorney as to whether they had broken the law. He wasn't the only city councilperson to request these outrageous fees. Councilman Brian Maienschein requested $345,000. Councilwoman Toni Atkins requested $365,696.

The other councilpersons were close behind with their requests with the exception of Councilwoman Donna Frye, who not only refused to take taxpayer money but also paid her own attorney fees which amounted to $5,000.

I wonder if a private citizen could have paid these fees, which to this date have been unaccounted for due to the refusal of the city council and mayor to release the records necessary for a full accounting. In any event, the council approved these fees and also fees for the representation of any other city employee who was to be interviewed or deposed. It didn't matter whether or not any of them had been sued or even suspected of wrongdoing. They all received counsel from private attorneys at the taxpayers' expense. At last count, the fees paid for these counseling attorneys was in excess of $3 million.

Maybe if the city had competent council members and skilled employees there would be less need for this continual army of experts who troop through City Hall with their main strength being how to bill.

Sunday, June 15, 2008

Judie Italiano announces that she's MEA's executive-for-life

The San Diego Union Tribune quotes Metropolitan Employees Association general manager Judie Italiano as saying:

"MEA is never, ever, as long as I can draw a breath, endorsing Mike Aguirre."

Well, that's pretty clear. But MEA's lawyer Ann Smith has made it clear that she and former president Judie Italiano are a package deal. Ann Smith "threatened" to resign if Judie were not named general manager.

Judie and Ann are perfect duplicates of California Teachers Association's controlling couple, Carolyn Doggett and Beverly Tucker, the CTA executive director and her lawyer, who also seem to be a package deal.

Well, San Diego, it seems we're in for a long ride with JudieAnn Italismith. We'll have their billion-dollar budget-busting noses in faces, making demands for some time.

Saturday, June 14, 2008

Aguirre has recovered $10 million, more than he's spent in pension lawsuits

Mike Aguirre's campaign for reelection just got a big shot in the arm. His accusers must now admit that his aggressive pursuit of those who defrauded San Diego in the pension scam and related investigations has paid off for the city.

$4.35 million settlement in pension lawsuit
Law firm represented city before the SEC

By Craig Gustafson
San Diego Union Tribune
June 14, 2008

Vinson & Elkins, the Houston-based law firm whose two-year investigation into San Diego's finances was criticized as a whitewash, has agreed to settle with the city for $4.35 million.

The firm would be the fourth to settle lawsuits related to financial and legal troubles from the city practice of increasing employee pension benefits while cutting funding for them.

Pension-related settlements:

July 2006: Two auditing firms, Caporicci & Larson and Calderon, Jaham & Osborn, paid $1.65 million total to the city. Calderon conducted the city's annual financial audits, which were later found to contain million of dollars in errors. Caporicci, of Costa Mesa, later bought the firm and denied any wrongdoing by itself or Calderon.

November 2006: San Francisco-based Callan Associates, a pension consultant that advised San Diego's retirement system, agreed to pay $4.5 million to the city. City Attorney Michael Aguirre accused them of faulty investment advice. The firm admitted to no wrongdoing.

City Attorney Michael Aguirre classified the settlement as a victory for his pension-related lawsuits, even though he had sought $10 million.

Vinson & Elkins, which also represented Enron, admitted no wrongdoing but agreed to pay back $3.25 million to the city and forgive $1.1 million in outstanding bills, Aguirre said. The City Council will vote Tuesday on the settlement...

Saturday, June 07, 2008

The Cheryl-Greg connection and a political prosecution

Patsy Fritz seems to agree with me about who approved of the shameful prosecution of Steve Castaneda. The D.A.'s office claimed that Castaneda had intended to buy a certain condo, and that even though he never bought it, the D.A.'s office believed that Castaneda lied about wanting to buy it.

San Diego's district attorney charged a man with a dozen or so felonies based on the apparent ability to read his mind. San Diego needs a new district attorney.

[Photos: Cheryl Cox on left, Bonnie Dumanis far right]

Here is a well-written message I found on the San Diego Growth Blog:

"What we have here, I think, is the effort to curry favor by Dumanis, and the Supes' quid-pro-quo for her support during their election campaigns.

"...I have wondered why the Lincoln Club and Republican Central Committee are not shown as "friends of the court" in O'Toole's capers. I see this as Bonnie sucking up not only to the Supes, but to the downtown Republican establishment. She's been a Republican for some time (prior to her first race for DA) but for obvious reasons needs to burnish her Republican rep to get the downtown establishment's support.

"I truly regret the time, $$$ and effort I put into that race, garnering votes in North County for Dumanis. I was S0 idealistic about Bonnie, but she's turned into just another run-of-the mill influence peddler - for her own interests. Sad! She could have been a real force for ethics and reform!"


Solengo Capital wants Dealbreaker.com to keep Solengo prospectus secret

Harvard's Citizen Media Law Project reports:

Solengo Capital Advisors v. Dealbreaker.com
Posted June 6th, 2008 by David Ardia
Threat type: LawsuitDate: 03/30/2007
Subject Area(s): Copyright
PartiesParty Issuing Threat:
Solengo Capital Advisors ULC
Party Receiving Threat:
Dealbreaker, Elizabeth Spiers, John Carney, Bess Levin, John Doe and Jane DoeType of Threatening Party:

Dealbreaker.com, a website that describes itself as "an online business tabloid and Wall Street gossip site," was sued for copyright infringement by Solengo Capital, a hedge fund founded by former Amaranth Advisors traders, over Dealbreaker's posting of Solengo's prospectus, which contained information about the firm's planned structure, trading and risk management platforms, and biographies of its founders.

In response to Solengo's initial threat to file a lawsuit on March 28, 2007, editors at Dealbreaker said the materials were of legitimate news value and refused to remove them, telling Reuters:

"We think it's valuable to our readers and the public to be able to see the information in it," said John Carney, DealBreaker editor, in an interview on Friday.

The legal dust-up is the latest stemming from the abrupt implosion of $9.3 billion hedge fund Amaranth last year, which shocked investors and raised awareness of hedge fund risk. The recent founding of Solengo by some of the energy traders blamed for the $6 billion in losses that caused the Amaranth collapse has also generated controversy.

Carney, a former corporate lawyer, said his site plans to contest any legal challenge. "We're willing to take it as far as it merits. I don't expect to defy a court order or go to jail for it, however."
On March 30, 2007, Solengo sought a preliminary injunction ordering Dealbreaker to remove the prospectus from its website. After the court denied the injunction request, Solengo filed a complaint alleging copyright infringement against the website and several of its editors.

On April 2, 2007, the court issued a preliminary injunction on consent of the parties, requiring Dealbreaker to remove the prospectus pending the outcome of the litigation. On May 24, 2007, Dealbreaker filed a motion to dismiss, arguing that Solengo had failed to register its copyright in the prospectus prior to filing suit.

In August 2007, the parties reached a settlement, and the prospectus appears to have been permanently removed from the Dealbreaker site.