CALIFORNIA

L.A. County D.A.'s corruption case against three Irwindale officials is dismissed

Prosecutors portrayed the corruption case as city officials partying on the public dime.

Irwindale employees and council members treated themselves to steak dinners and Yankees tickets during lavish trips to New York that included pricey Broadway shows and a hockey game.

The details sparked outrage in the small San Gabriel Valley community.

But last week, the corruption case brought by the Los Angeles County district attorney's office against three Irwindale officials collapsed when prosecutors announced they could no longer proceed.

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The dismissal followed a series of legal setbacks for the office. An appellate court dismissed an early round of charges after concluding that prosecutors failed to present grand jurors with evidence favorable to the defendants. And the case began to crumble again when a judge ruled last year that the D.A.'s office waited too long to file criminal charges, missing the deadline for prosecuting many of the offenses.

A Times review of court documents shows a former Irwindale councilman alerted prosecutors in 2005 to officials possibly misusing their credit cards on trips. The office closed an inquiry a year later and prosecuted the officials in 2010 only after a local newspaper reported on the spending.

"To me, the D.A. blew it," Sal Hernandez, the former councilman who sent the letter, said in a recent interview. "I'm just appalled."

The D.A.'s Public Integrity Division has racked up big wins in its 15-year history, including convictions of seven officials in the Bell salary scandal and Los Angeles City Commissioner Leland Wong for bribery. But last week's dismissal marked the latest blow for the elite unit, which has been accused of misconduct in some recent high-profile cases and of sometimes failing to pursue allegations aggressively enough.

In 2012, another judge, Kathleen Kennedy, ruled that prosecutors failed to properly present the grand jury with evidence favorable to L.A. Councilman Richard Alarcon about whether he was illegally living outside his district. Kennedy threw out the perjury and voter fraud charges, but the D.A.'s office immediately refiled the case and went on to convict Alarcon at trial. (An appellate panel overturned the conviction, finding that a jury instruction read by the judge was improper.)

Last year, Kennedy scolded the unit after learning that the lead prosecutor on the L.A. Memorial Coliseum bribery and conspiracy case had read emails between one of the defendants and his attorney. Although the prosecutor's actions were inadvertent, the office said, he was replaced. Kennedy said she was shocked the unit lacked proper training in handling evidence.

During the Bell case, Kennedy said she couldn't understand why the office hadn't charged Police Chief Randy Adams, who had a $475,000 salary. Prosecutors say they could not build a case against Adams because he did not control the city's purse strings when he signed his lucrative contract.

Asked about those cases, Dist. Atty. Jackie Lacey issued a statement saying her office has "successfully prosecuted more public officials for corruption than anywhere else in California." Her office, Lacey added, is often forging new legal ground in these cases and faces "unique legal challenges."

In the Irwindale case, officials took trips to New York from 2001 to 2005 in an effort to get better bond ratings. The city employees got tickets to the musicals "Wicked" and "Phantom of the Opera" and stayed at the Ritz-Carlton on Central Park, according to court documents. Financial consultants paid for the expenses but were reimbursed by the city of Irwindale.

In the fall of 2005, the D.A.'s office received three letters — two from San Gabriel Valley resident James Hunley and another from Hernandez, the former councilman.

Hernandez's letter, according to court documents, alleged "misappropriation of public funds" by city officials and council members and mentioned possible misuse of city credit cards during trips to various cities, including New York. A letter from Hunley also mentioned trips to New York.

The Public Integrity Division opened a review into some of the allegations. The inquiry was closed a year later.

In 2007, the San Gabriel Valley Tribune reported details of the trips to New York, saying Irwindale officials splurged on a $1,027 brunch, drank $250 bottles of wine and attended the musical "Aida" at $210 a ticket.

About a week later, according to court documents, the D.A.'s office launched an inquiry.

In the fall of 2010, the office charged four officials — then-Councilman Mark Breceda, who is now mayor, former Councilwoman Rosemary Ramirez, retired City Manager Steve Blancarte and retired Finance Director Abe De Dios — with misappropriation of public funds. Prosecutors at the time said it took three years after the newspaper article was published to file charges because they had to conduct numerous interviews and confirm officials' attendance at specific venues in New York.

The council members' attorneys condemned the charges, saying their clients had no knowledge of wrongdoing and thought the trips were being paid for by financial consultants, not the public.

At a court hearing in October 2011 on whether most charges had been filed within the legal time limit, prosecutor David Demerjian, then head of the Public Integrity Division, testified that the 2005 letters from Hunley and Hernandez appeared to be full of "rumors" and "mere allegation," according to a transcript.

A defense attorney asked Demerjian what "reasonable steps" his office had taken in 2005 to check claims about trips to New York paid for with city credit cards.

"None," Demerjian responded.

Two months later, prosecutors obtained a grand jury indictment against the officials for embezzlement, adding a fifth defendant, Councilman Manuel Garcia. The previously filed misappropriation charges were dismissed.

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In 2013, a panel of appellate justices called the money spent on the trips "shocking" and "an abuse of the public trust and perhaps violative of certain criminal laws." But the justices ruled that prosecutors failed to show grand jurors documents that might have undercut their argument that city officials double-dipped by collecting a $75-a-day per diem at the same time the city paid their expenses on the trips. In the documents, the city manager explained that the daily allotments were to be paid even if meals had otherwise been paid for.

The D.A.'s office refiled the case four months later — this time with misappropriation of public funds, embezzlement and conflict of interest charges.

Defense attorneys argued most of the charges had been filed after the legal deadline for prosecution. Prosecutors said the 2005 letters were too vague to lead them to specific crimes to investigate. But Superior Court Judge Michael E. Pastor ruled that prosecutors had enough information from the 2005 letters to put them "on notice" and start the clock on the four-year period they had to file.

The ruling wiped out all the misappropriation of public funds and conflict of interest charges, leaving only embezzlement of public funds — a charge with no filing limit, but also a harder one to prove. Unlike misappropriation, embezzlement requires prosecutors to show that the defendants knew they were breaking the law.

The charges against Breceda, Ramirez and Garcia were dropped last week. The district attorney's office blamed "a series of adverse court rulings" and said the embezzlement charges could not be proved beyond a reasonable doubt.

Two other former city officials charged in the case previously took plea deals. Blancarte pleaded guilty in 2011 to misappropriating public funds and was sentenced to three years' probation. De Dios pleaded no contest in 2014 to misdemeanor conflict of interest and received the same sentence.

Garcia's attorney, Steven Graff Levine, praised last week's dismissal and said his client is seeking to recoup legal fees from Irwindale.

"He's out of his life savings," Levine said, "to defend a crime he absolutely did not commit."

But Hernandez, the former councilman who wrote to the district attorney's office in 2005, described news of the dismissal as "a bombshell."

"It's so frustrating," he said.

marisa.gerber@latimes.com

Twitter: @marisagerber

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Copyright © 2016, Los Angeles Times
A version of this article appeared in print on March 04, 2016, in the News section of the Los Angeles Times with the headline "Corruption case against Irwindale officials dismissed - It's the latest legal setback for the L.A. County D.A.'s office." — Today's paperToday's paper | Subscribe
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