Bell 8 see hope in Supreme Court ruling

Defense attorneys for the former Bell leaders accused of looting the city’s treasury said their clients scored a victory this week in a state Supreme Court ruling involving a Northern California official accused of misappropriating public funds.

The high court, in rejecting an appeal from Sutter County Auditor-Controller Robert Stark, said that prosecutors in public corruption cases have to prove that defendants knew they were breaking the law, or were criminally negligent in not knowing.

The so-called Bell 8 — former council members Luis Artiga, Victor Bello, George Cole, Oscar Hernandez, Teresa Jacobo, George Mirabal, former City Administrator Robert Rizzo and his assistant Angela Spaccia — maintain they had no idea they were violating laws as they helped themselves to bloated salaries, top-of-the-line retirement benefits and personal loans from the city.

Their attorneys said they would cite the Stark ruling when they ask that charges be dropped. A hearing is scheduled for September.

“It’s a big boost for the defendants because it says there has to be some sort of criminal intent in order to be convicted of misappropriation of funds,” said Stanley L. Friedman, Hernandez’s attorney.

Hernandez, along with the other former council members, is charged with being paid for sitting on city boards that met for only a few minutes, if at all. The majority of the council’s near-$100,000 salaries came from what one judge called “sham agencies.”

Friedman said the former mayor had no idea how his salary was broken down.

“They were just told, ‘You’re being paid X amount,’ ” Friedman said. “Mr. Hernandez didn’t have an obligation to look at the reports to see the source of the funding.”

L.A. County Deputy Dist. Atty. Max Huntsman brushed off the suggestion that the Stark ruling was a blow to the Bell case, which has drawn national attention.

“It’s a new explanation of something that changes the game a little bit, but it’s not going to have a radical impact,” he said. “They probably shouldn’t take great comfort in this.”

In 2005, a grand jury indicted Stark on felony charges after he allegedly made arbitrary policy changes, including filing a late budget, withholding overtime pay from firefighters and transferring money from a general fund reserve to a waterworks district. The case inched its way to the Supreme Court, which handed down a 60-page ruling Monday that for the first time in more than eight decades clarified the necessary mental state to be convicted of misappropriating public funds.

The court also ordered Stark to stand trial, though his attorney said that if his client can demonstrate that he believed he acted within his authority, it is unlikely he will be convicted.

“The ruling simply allows for somebody who believes they were doing the right thing from being prosecuted. You’re not going to have many people who want to serve in government if they do their best job and they’re convicted of a felony from that,” said M. Bradley Wishek, Stark’s attorney.

According to veteran municipal attorney Michael Colantuono, the Stark ruling is a technicality that should have little effect on the case in Bell, where officials are accused of not just moving public money around, but using it to line their pockets.

“The kinds of things Rizzo was accused of — authorizing loans and taking an unapproved salary — it will be difficult to prove that a competent city manager would not know those things were wrong and illegal,” Colantuono said.

Rizzo, who was earning nearly $1.5 million in total compensation in one of the county’s poorest cities, has argued that a vague City Charter empowered him to approve nearly $2 million in city loans. Rizzo, Artiga, Hernandez and Spaccia were among the dozens of city employees who accepted loans, as did former Police Chief Randy Adams, who was forced to resign but was never charged in the case.

“If the chief of police and City Council members are taking loans under the program and Mr. Rizzo does not get one penny or engage in one act involving secrecy, it is impossible to find he was criminally negligent and deliberately trying to avoid knowledge,” said Rizzo’s attorney, James Spertus.

corina.knoll@latimes.com