City of LA hit with $2.5 million in sanctions

Meanwhile, the FBI never left Lost Angeles...

Los Angeles City Attorney Mike Feuer took a hit today after a judge ordered the city to pay $2.5 million in sanctions related to discovery misconduct in a water billing case. Why does that matter? The water billing case is still under FBI investigation, pretty much just like the rest of Los Angeles.

But here’s what the civil judge, Elihu Berle, had to say this morning:

“The court finds serious abuse by the city and its counsel. This serious abuse merits considerable sanctions,” said Berle behind a face shield inside a mostly empty courtroom.

The penalty was levied in the most banal way imaginable, but it was significant. The judge cited failure by the city to produce documents and witnesses over the last few years. But one of the notable things the judge pointed out is that Feuer’s office failed to tell him about dual representation in the water billing case, in which utility customers were issued incorrect bills. Two private lawyers hired by Feuer’s office recruited a plaintiff and basically sued itself, so it could control the lawsuit and get a favorable settlement. In other words, imagine hiring an attorney to sue the city, but the whole time that guy was working for your opponent. In this case, DWP customer Antwon Jones hired New York attorney Paul Paradis to sue the city, but didn’t know he was working for the city and trolling for easy clients. How does that happen? I’ll explain more later, but for now, keep in mind that the judge was pretty pissed off about that, especially after the case went Looney Tunes before him for five years.

The sanctions were awarded to Pricewaterhouse Coopers (PwC), the company Feuer sued over the botched billing rollout. Feuer and the city tried to put the blame on PwC, but once the issue of dual attorney-client relationship surfaced, PwC was furious. The company’s attorney, Daniel Thomasch of Gibson Dunn & Crutcher, said it had to fight the city tooth and nail for 25 months to get information about the whole debacle.

“Why was Antwon Jones chosen as the plaintiff? The city said it was random,” said Thomasch in court, asking for $8 million in sanctions. Then he went on to say that Jones was chosen only because he was a favorable opponent whom the city could control.

An attorney for the city, Eric George of Browne George Ross, argued the sanctions were too high, not timely, and unsupported by case law. Feuer’s office hasn’t responded to a request for comment. He’s said he had no idea about the conduct of his outside attorneys, while the attorneys said the work they performed was at the direction of the city attorney.

The question now is who exactly will pay the money? Will the city try to make pay up the resigned lawyers it originally hired to handle all of this?

“When attorneys are hit with sanctions usually the attorneys pay, not the client, but here City Attorney Mike Feuer's malfeasance will be paid by taxpayers,” said Jamie Court, president of Consumer Watchdog.

Feuer plans to run for mayor, and has already started fundraising. Definitely more to come.