4th figure in DWP mess to face criminal charges
and the first one from the city attorney's office.
The scope of the government’s criminal probe into DWP is widening: One of Mike Feuer’s former top lawyers at the city attorney’s office will plead guilty to aiding and abetting extortion, federal prosecutors announced today.
As a result, Thomas H. Peters, 55, faces 20 years in federal prison for pressuring attorney’s hired by the city to pay a sizable extortion demand in order to keep the collusive DWP billing litigation under wraps, according to prosecutors.
This is the 4th criminal charge to come down in the DWP scandal, in which city lawyers colluded with opposing counsel to settle numerous billing lawsuits against it, and in the process deprived those suing LADWP of fair legal representation.
The latest matter involves Paul Kiesel, one of two special counsel hired by Feuer, as well as one of Kiesel’s former long-time employees, a female only named “Person A” in government documents.
Peters previously worked for Kiesel’s law firm, Kiesel Law, prior to his stint at the city attorney’s office. His wife, Elaine Mandel, a superior court judge, also worked for Kiesel Law.
According to the government, Person A had stolen or improperly obtained documents that would reveal the city’s undisclosed collusion in the Jones v. city of Los Angeles billing case.
“Person A had threatened to reveal the documents if Kiesel did not pay her to return them,” according to a statement by the U.S. Attorney’s Office. The female attorney demanded more than $1 million to bury the documents, and threatened to show up at a court hearing to expose the scandal, according to the government.
This was in November 2017, over a year before DWP collusion hit the news.
“Peters knew that this document would lead PwC to discover the undisclosed collusive origins of the Jones v. City case, which would be damaging both to the city’s litigation position and to the reputation of the City Attorney’s Office,” stated the government.
Peters, who is cooperating with prosecutors, could not be reached for comment. Paul Kiesel has not been charged and is also cooperating with prosecutors.
According to the government, the following occurred:
Peters met with Paul Paradis, Kiesel’s co-counsel for the city, as well as Kiesel, who was reluctant to pay the extortion demand, but Peters insisted. If not, Peters said Kiesel could be fired from his job with the city.
On December 1, 2017, Peters met with other “senior members” of the City Attorney’s Office and updated them on the status of Person A’s threats. Among other things, Peters conveyed that Kiesel had described Person A’s threats as “extortion.” Peters was directed to take care of the situation, and he agreed to do so.
Following that meeting, Peters advised Paradis that “senior leadership” at the City Attorney’s Office was “not firing anyone at this point” but warned that others were concerned about “the prospect of a sideshow” if Person A made good on her threat.
Person A appeared at the December 4 hearing and attempted to give documents to a court employee, who advised Person A that the court would not accept documents from a non-party. Person A approached the lead counsel for PwC with the documents, stating that she had information that could help PwC’s case. PwC’s counsel exchanged business cards with Person A and asked her to call him.
After the hearing, Peters, “reiterated” that Kiesel needed to pay Person A’s demand to obtain the return of the documents, or he would be fired.
On the evening of December 4, 2017, Person A, Kiesel and Kiesel’s friend met at a restaurant and further discussed Person A’s demands. It was there that Kiesel agreed to pay $800,000 to Person A to prevent her from releasing the documents.
After Kiesel texted Peters to tell him the agreement was reached, Peters replied to Kiesel later that night, stating, “Good job,” and directed Kiesel to ensure that there was a strong confidentiality agreement with Person A regarding the $800,000 payment and the documents.
Fast forward to 2019, Peters resigned from Feuer’s office and was asked about the payment.
“Peters falsely replied that the matter had only involved an employment dispute,” said prosecutors.
According to his plea agreement, Peters conveyed that he would continue to conceal the extortion and collusion by intentionally omitting from his reply that the “settlement” had involved Kiesel paying Person A $800,000 in extortion money to conceal the city’s collusion, that Peters had directed Kiesel to satisfy Person A’s monetary demands or be fired as special counsel, and that Peters had discussed the situation with and received direction from senior members of the City Attorney’s Office.
In a statement, Feuer said he wasn’t aware of Peters’ conduct until the government’s announcement.
"I am furious and disappointed beyond words that someone I hired and placed faith in would commit this breach of trust—of the public, of my office and of me personally," said Feuer. "Nearly three years ago I asked for and received the resignation of this individual because of unrelated past conduct, but at no time until today was I aware of Mr. Peters' illegal actions.”
“The fact remains that I hired Mr. Peters and put him in a position of great responsibility. I own that choice. As with every decision in my office, the buck stops with me.”
In its documents, prosecutors describe that a “senior City Attorney official” had directed and authorized the litigation strategy. Feuer has denied knowing about the strategy. Feuer’s top deputy during this period until his retirement last year was James P. Clark. He has not been charged with any crime.
Thank you for the breakdown of these latest shocking charges. It is truly mind boggling to read that members of the "city family" were shaking each other down to cover up crimes against tax payers. Assuming the extortion money was paid, where did this $800,000 come from, and was it reported to the IRS at either end of the transaction?
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