Federal Judge Unseals Warrants in Case of Botched LADWP Billing

Federal Judge Unseals Warrants in Case of Botched LADWP Billing

The Department of Water and Power (DWP) San Fernando Valley Generating Station in Sun Valley, Calif., on Dec. 8, 2008. (David McNew/Getty Images)

City News Service

City News Service

4/17/2024

Updated: 4/17/2024

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A Los Angeles federal judge on April 16 unsealed 33 FBI search warrants and related documents that detail a probe into alleged unethical and illegal activity at the L.A. City Attorney’s Office and the Department of Water and Power.
The government’s investigation came in the wake of the DWP’s botched launch of a new billing system in 2013 that cost taxpayers hundreds of millions of dollars.
As a result of the U.S. Attorney’s Office probe, which ended in November, a former high-level advisor to former City Attorney Mike Feuer, an outside attorney hired by Feuer’s office, and two top DWP officials pleaded guilty to federal bribery and extortion charges.
However, questions remain about the roles other key officials played in the city’s misconduct, including Feuer, according to the consumer advocacy group Consumer Watchdog.
The FBI warrants and other materials were sought in a legal action filed in Los Angeles federal court by Consumer Watchdog and the Los Angeles Times.
Jerry Flanagan, legal director for Consumer Watchdog, said the law states the public has a right to such documents when a government criminal investigation has ended.
“The court’s order is a win for all those who believe sunlight is the best disinfectant,” Consumer Watchdog staff attorney Ryan Mellino said. “Unsealing these records sends a message that public officials will not be protected from public scrutiny.”
A request for comment sent to a representative for the City Attorney’s Office was not immediately answered.
“Public confidence in government—which lies at the core of a well functioning democracy—is shaken, if not shattered, when public officials and those operating on their behalf engage in criminal or unethical conduct,” U.S. District Judge Stanley Blumenfeld Jr. wrote in his final order Tuesday.
“The nature and scope of misconduct in this case, resulting in convictions of high-level public officials at two municipal agencies, raise serious questions about a culture of corruption. These questions warrant public scrutiny to determine the extent to which wrongdoers have been held accountable and the extent to which the affected agencies have been reformed.”
The judge wrote that the “need for scrutiny is only heightened where the corruption threatens the integrity of the judicial system and the safety of this nation’s infrastructure. Without disclosure of the identities of the public officials and others working for the city, the public would not be able to `properly evaluate the fruits of the government’s extensive investigation.”
In a tentative opinion issued before a hearing last Friday, the court denied the U.S. Attorney’s Office’s request to redact the names of city employees and other officials, including private attorneys working on behalf of the city. However, the court did not decide the issue of whether statements in an affidavit by FBI Agent Andy Civetti that Feuer lied to the grand jury would be released. The final order makes clear that those statements will be released, but that any references to the substance of grand jury testimony will be redacted consistent with federal rules.
In late 2014, in an attempt to take control of the ever-worsening billing debacle, the City Attorney’s Office hatched a scheme to sue itself through a collusive “white knight” lawsuit, in which the office controlled the litigation nominally brought on behalf of DWP customers against the city.
The lawsuit ultimately settled on terms favorable to the city.
According to government documents, following the collusive litigation settlement, an employee of Beverly Hills lawyer Paul Kiesel, who was retained by Feuer to represent the city, threatened to expose the city’s misconduct unless she was paid off, and unnamed “senior members of the City Attorney’s Office” directed the extortion payment to be made in the amount of $800,000, Flanagan said.
Kiesel cooperated with the investigation and was not charged with any wrongdoing.
Lawyers for Consumer Watchdog and The Times argued the public has a strong interest in assessing why prosecutors made the charging decisions they did, particularly where those decisions were made about highly influential and powerful public officials who were not charged, while lower ranking officials were charged, according to Flanagan.
The DWP has estimated that the billing scandal cost the city more than $120 million.
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