the final sentencing in LADWP corruption is shaping up to be a wild one
the final sentencing in LADWP corruption is shaping up to be a wild one
a former lawyer for the city of LA is not holding back as to how collusion inside the city attorney's office went down.
The sentencing papers for former city lawyer Paul Paradis are in. Federal prosecutors are asking the judge to send Paradis, who pled guilty to concocting a fake lawsuit against the city of Los Angeles and admitted to his involvement in three bribery schemes, to 18 months in prison. Before we dig deeper into that, Paradis has also filed a letter to the sentencing judge, Stanley Blumenfeld, in which Paradis names names. For a while, this whole LADWP saga unraveled in a way that portrayed Paradis as the reason for every bad thing that happened, such as the collusion and extortion etc. But things changed. Paradis came with receipts. More information started trickling out indicating that Paradis, an outside lawyer from New York, could not have pulled off the magic trick that he did involving the biggest case the city was dealing with at the time without being enabled by his superiors inside the Los Angeles City Attorney’s Office.
In his letter, Paradis names those superiors, including then-City Attorney Mike Feuer, and his deputy, Jim Clark. When the city in 2014 was facing multiple lawsuits over utility billing errors by the Department of Water and Power, and wanted to swiftly clean up the PR disaster, Paradis said Clark asked Paradis if he knew of any friendly lawyers.
“The web of lies and deceit began with the ‘collusive litigation scheme’ that Chief Deputy Clark asked me and others to corruptly implement to achieve a collusive settlement in the Jones v. City class action on terms and a schedule that had secretly been dictated by the City Attorney's office,” wrote Paradis in his letter.
The preciousness of a mayoral run Feuer was eyeing also had to be protected.
“The collusive scheme was essentially implemented to enable the City Attorney's office to "change the public narrative" and re-direct public criticism away from elected city officials and toward PricewaterhouseCoopers, LLP, the consulting firm that had implemented the LADWP's defective billing system,” wrote Paradis.
Paradis then mentions the December 1, 2017 meeting in which senior officials okayed an extortion payment to bury information that would have revealed the city was playing both sides of the fake lawsuit against the city.
“Unwilling to bear the consequences that were likely to end his campaign for Mayor of Los Angeles before his campaign had even officially begun, during a meeting that began in his office at 4:45 pm on December 1, 2017, City Attorney Feuer participated in a meeting with his subordinates, including Thomas Peters, to discuss the extortion threat,” wrote Paradis. “During this meeting, Peters was directed to instruct [Paul] Kiesel to pay the extortionist to buy her silence - else Kiesel risked being terminated as Special Counsel to the City in another litigation brought on behalf of the City.”
Kiesel was Paradis’ co-counsel to the city. This is probably the most straight-forward accounting of high-level involvement at the city attorney’s office by an involved party. Peters, on the other hand, did not name names during his sentencing, despite also admitting that he was acting on orders from senior officials regarding the hush payment. So it looks like Paradis is not holding back, and it will be interesting to see what the judge will do with this information. But will Paradis bring receipts?
Sentencing memos
In asking for 18-months of jail time, prosecutors argue that Paradis was “the epicenter” of misconduct; his actions motivated by “pure greed.” They said he “spawned a tidal wave of criminal acts, corruption, and unethical conduct” that infected the City Attorney’s Office, and the Department of Water and Power.
This included bribing an Ohio lawyer who filed the Paradis-drafted lawsuit, Jack Landskroner, by installing him with the job of representing ratepayer Antwon Jones and then taking an almost $2.2 million kickback, 20 percent of Landskroner’s fees. The $67 million settlement was executed with no discovery.
“At no point did defendant or Ohio Attorney ever disclose to Jones that defendant had been hired to represent the city, whom Jones was suing, in a related matter,” wrote prosecutors. “In those and all other instances, Ohio Attorney passed off defendant’s work product as his own, concealing the collusive nature of the litigation from the court and the public.”
Paradis and Landskroner formed shell companies to conceal the $2.17 million payment to Paradis, according to prosecutors.
Things continued. Paradis bribed former LADWP general manager David Wright with a job and a Mercedes in exchange for Wright pushing a $30 million contract for a Paradis-controlled company called Aventador Utility Solutions before the LADWP board in 2017. Prosecutors said Paradis also bribed an LADWP board member by performing legal work for the board member in exchange for the board member’s vote for the Aventador contract. Former LADWP board member Bill Funderburk denied taking the bribe.
In March 2019 I reported about the collusion in Jones, Feuer opened an investigation, and Paradis went straight to the feds. For the next 15 months, he was a busy boy, conducting 184 undercover operations, leading to conviction of two LADWP officials and a former city attorney official. Paradis said he performed more than 2,000 hours of work for the government, and another 2,000 for the State Bar, which is currently performing its own investigation. According to the sentencing memos, he is also cooperating with plaintiffs suing in federal court the city of LA and others involved in the collusive litigation.
The government described Paradis’ cooperation as “extraordinary” and “unprecedented.” But despite that, they said they had a hard time reconciling Paradis’ criminal acts with the enormous assistance he provided them in their investigation.
“Had defendant not cooperated, it is possible that the government could not have brought all the charges in this investigation,” wrote prosecutors in the Public Corruption Unit.
At the same time, “Without the defendant, the collusive litigation would have never occurred,” said prosecutors.
I guess that’s technically true. But the same can be said about city attorney officials. How could the collusive litigation never have occurred without Paradis if “city attorney personnel,” according to prosecutors themselves, “directed defendant to find a malleable lawyer?”
The city wrote in its papers that, “Top City Attorney’s Office personnel directed defendant to find a malleable lawyer for his client, Jones, to sue the City in a “white knight” lawsuit that would allow the City to quickly resolve all existing claims.”
Those officials have not been charged, and prosecutors won’t reveal their names.
Paradis is asking for no jail time so he can continue cooperating with the State Bar and “expose the previously unknown crimes and ethical breaches of others.” He cited a redacted serious health problem, as well as his cooperation with the government and State Bar, as reasons.
He also said in his papers that he should get more sentencing credit than Peters did, whom prosecutors also recommended 18 months of prison time. Probation is recommending 120 months in prison.
“Given that in U.S. v. Peters, the government recommended a seven-level departure for federal and Bar cooperation, and the exponential difference between Mr. Paradis’ cooperation and Peters’, Mr. Paradis requests that the Court depart at least 22-levels based on Mr. Paradis’ extraordinary and unprecedented cooperation,” wrote Paradis’ lawyers at Winston & Strawn.
So they basically said Paradis cooperated way more than Peters, but isn’t getting enough credit for it. They also said Wright got a six-level downward variance for depression, meaning six points off his sentence recommendation, while Paradis received zero points for his health issue.
Prosecutors, meanwhile, said Paradis’ conduct is “far more aggravating” than that of the other three defendants, combined.
Most of Paradis’ exhibits are filed under seal, but there are some clues. There are 18 exhibits filed for his cooperation with State Bar investigators, and six for the federal government. He’ll be sentenced on June 27.