Witness Disputes Key Hedgecock Case Issue

Undermining the testimony of a key prosecution witness in the felony retrial of San Diego Mayor Roger Hedgecock, a Century City lawyer who gave Hedgecock personal financial advice in 1981 said Wednesday that Hedgecock was not present when the bill for his services was discussed.

Rather, lawyer Ronald Blanc, who advised Hedgecock on possible solutions to severe financial problems stemming from the failure of a condominium development partnership, said that Sorrento Valley investment counselor Harvey Schuster, asked “privately, out of Hedgecock’s presence,” that the legal bill be sent to him.

Defense attorney Oscar Goodman argued that Blanc’s explanation of his November, 1981, meeting with Hedgecock and Schuster “destroyed” the credibility of Schuster as a witness.

Earlier this month, Schuster testified that he drove Hedgecock to Los Angeles to discuss his financial problems--which included possible foreclosure on his house--with Blanc in November, 1981. During that meeting, Schuster testified that, in Hedgecock’s presence, he told Blanc, “Please send me the bill.” During intense cross-examination by Goodman, Schuster joked that Hedgecock possibly “went to the small boy’s room” while the bill was discussed, but added, “My recollection is that Roger was there.”

Blanc, however, cleared up any possible uncertainty about the matter on Wednesday when he testified that Hedgecock definitely was not present when he discussed payment of the legal bill with Schuster.

“Privately, out of Hedgecock’s presence, Schuster told me to bill Schuster directly,” Blanc testified. That conversation occurred in Blanc’s office while Hedgecock was not in the room, the lawyer added.

After Wednesday’s court session, Goodman argued that Blanc’s testimony bolstered the defense’s contention that Schuster lied in his testimony because of his anger over not receiving a lucrative contract to develop the county’s bayfront parking lots that was awarded in 1982 while Hedgecock was a county supervisor.

“The fact that Schuster was so insidious and pernicious in the way he tried to suggest that Roger Hedgecock was present when the fee was discussed was destroyed . . . by Mr. Blanc,” Goodman said. “And the inference of that is that Schuster once again is a liar.”

Wickersham, however, contended that Blanc’s testimony demonstrated that Hedgecock “knew that he was getting valuable legal services and that somebody paid the tab.”

Blanc testified that he gave Hedgecock preliminary advice at a Nov. 16, 1981, meeting that lasted more than 1 1/2 hours, and later sent Hedgecock a four-page letter with additional recommendations. Based on the amount of time he spent on the matter, Blanc’s normal fee would have been more than $1,100, the lawyer said, explaining that he discounted the bill to $500 because his “conclusions were rather routine.” Blanc also stressed that he did not give Hedgecock the impression “that my services would be free.”

Schuster’s testimony--as well as his credibility--is a pivotal factor in the mayor’s felony conspiracy and perjury retrial, because it is the only direct evidence that links Hedgecock to a purported conspiracy to funnel allegedly illegal donations from former J. David & Co. principals Nancy Hoover and J. David (Jerry) Dominelli to Hedgecock’s 1983 mayoral campaign through the political consulting firm of Tom Shepard & Associates.

Schuster told the eight-woman, four-man jury that, while driving back to San Diego from the meeting with Blanc, Hedgecock told him that Dominelli planned to bankroll Tom Shepard & Associates so that the political consulting firm would be able to run Hedgecock’s 1983 mayoral race.

That assertion by Schuster directly conflicts with Hedgecock’s oft-stated contention that he was unaware that Dominelli had invested in Shepard’s firm. The mayor has repeatedly insisted he believed that Hoover was Shepard’s financial backer, and that the major purpose behind her investments was to help her close friend Shepard start his own business, not to get Hedgecock elected mayor.

With the exception of Schuster’s testimony, the prosecution’s case is supported only by circumstantial evidence.

Much of Wednesday’s court session was devoted to testimony concerning one of the other key transactions involved in the case--a controversial $130,000 oral-agreement loan that Hedgecock received from Hoover in 1983 to renovate his South Mission Hills house.

Although Hedgecock since has repaid Hoover with interest, prosecutors argue that the renovation project cost far more than $130,000, claiming that Hedgecock received more money from Hoover and Dominelli than he repaid. Wickersham has suggested that the loan actually was intended to be a gift, adding that the transaction likely would never have come to light were it not for the collapse of the J. David firm in early 1984.

Two witnesses, however, provided testimony Wednesday that appeared to reinforce Hedgecock’s explanation that the money from Hoover was, from its inception, intended to be a loan, not a gift. La Jolla lawyer Clyde Greco Jr. testified that, while Hoover’s loan ultimately was not documented in writing, she earlier had him prepare numerous documents related to the transaction. In addition, contractor Parin Columna testified that Cindy Hedgecock, the mayor’s wife, “was very tight with her money” and constantly prodded workers on the project to hold down costs.