How Baker's Bright Promise Turned Into Despair

Times Staff Writers

Irvine Councilman C. David Baker's run for Congress in the 40th District was marred first by allegations of adultery and later a bizarre sequence of events that put the candidate in the hospital on the weekend before the June 7 primary election. This account of the final days of Baker's campaign was compiled from interviews with campaign workers, friends and colleagues with intimate knowledge of what transpired. Many of those agreed to comment only if their identities were not disclosed.

As he often did when the outside world pressed too close, C. David Baker, on the Friday night before Election Day, went driving alone in his black Mercedes.

Exhausted and emotionally spent, the congressional candidate was reeling from a dramatic confrontation earlier on the evening of June 3.

In a room on the seventh floor of the Irvine Co. headquarters in Newport Beach, surrounded by three friends who also were three of Orange County's more powerful men, Baker had broken down when questioned about writing an unauthorized $48,000 check on the account of a nonprofit foundation to cover last-minute campaign expenses. A political career that had all the signs of "can't miss" had hit bottom as the 6-foot, 9-inch, 325-pound Irvine City Council member wept.

Baker's condition prompted the three men--Superior Court Judge David G. Sills, Irvine Co. executive Gary H. Hunt and Baker's campaign chairman, Timothy L. Strader--to discuss immediate hospitalization of the despondent candidate. But Baker, the early front-runner in the Republican primary in the 40th Congressional District, resisted. Hunt then rode home with Baker to Irvine.

Later, however, Baker left the house, slouched in the front seat of his late-model Mercedes, driving alone into the Orange County night.

It was late the next morning, the weekend before the election, when Baker campaign manager John Nakaoka received an unsettling call about his candidate.

Nakaoka had arrived early at the campaign's headquarters next to the movie theater in Irvine's Woodbridge Village Center to finalize plans for the campaign's last three days.

The race was at a critical stage. Baker was locked in a three-way struggle with attorney C. Christopher Cox and businessman Nathan Rosenberg, both of Newport Beach, for the GOP nomination in the coveted 40th District, where heavy Republican registration gives the winner in that primary a big advantage in the general election.

Baker, backed by a host of a prominent local party activists, had been the early favorite, only to lose that edge to the hard-charging Cox. But now, 72 hours from Election Day, polls showed that the momentum was swinging Baker's way again, and with some last-minute mail to voters and a phone push, Baker might win, taking a big step toward filling the seat vacated by retiring Rep. Robert E. Badham (R-Newport Beach).

Nakaoka, however, was worried when he hung up the phone that morning.

The caller said Baker had failed to show up Friday night at an Irvine Chamber of Commerce function. With Baker's home less than 10 minutes from campaign headquarters, Nakaoka went there to find out what happened. He found only Baker's wife, Patty.

Candidate Baker, she told Nakaoka, was in a Newport Beach hospital.

"I was stunned," recalled Nakaoka, who, like other top campaign aides, did not learn of Baker's whereabouts until that morning.

Baker, under the name John Doe, had voluntarily entered Hoag Memorial Hospital Presbyterian about 3 a.m. Saturday for exhaustion and depression, leaving the campaign, as one Baker aide said, "rudderless at the worst time."

And except for a brief campaign appearance Sunday, Baker remained at Hoag until Monday afternoon. During that span, Baker missed at least seven campaign appearances, forcing his aides to scramble to explain his absence. Only a handful of people were told about Baker's hospitalization.

Baker's friends and supporters, Nakaoka said, "were going nuts when we wouldn't put them in touch with Dave. . . . A lot of people got angry. But my interest was in protecting Dave and his family. It was an extremely tough time."

When a beaming Baker, 35, announced his candidacy for Congress in January, it seemed a fitting extension of a career that had carried the son of a Mississippi sharecropper to unimaginable heights.

Baker, a former UC Irvine basketball star, was an attorney with the prestigious Los Angeles law firm of Paul, Hastings, Janofsky & Walker. He was a rising star within the clubby camaraderie of the county's Republican Party and counted some of the area's wealthiest and most influential people among his friends.

He was also executive director of the Irvine Health Foundation, a private foundation with a small, high-powered board and the kind of clout a $16-million endowment represents. His 1987 income, including $37,200 from the foundation, was close to $160,000.

A likable sort, with a big smile and a homespun manner, Baker appeared to have things going his way, particularly early in the campaign when the local GOP machine lined up behind the man campaign aides called "Jethro." First Baker was endorsed by Badham, then by Orange County Supervisor Thomas F. Riley and state Sen. Marian Bergeson (R-Newport Beach).

But by the campaign's midpoint, Baker's candidacy had stalled.

Both Cox and Rosenberg had raised more money, and Baker was being dogged by allegations of an extramarital affair, a charge that was particularly difficult for Baker, a fundamentalist who stumped on family values. He never publicly denied the infidelity allegations, saying only that he and his wife had been separated for a time but that through counseling they had strengthened their 13-year marriage.

Still, the race was extremely close entering the final week, and Baker knew it.

He needed money to send a series of last-minute mailers, so he took a second mortgage on his house. Final approval of the loan was expected May 27 but was delayed because of a problem with the appraisal on Baker's home.

By Wednesday, June 1, with the loan on the house still in doubt and the election less than a week away, Baker had apparently gone elsewhere in search of money.

Pat Cruze worked as a legal secretary for Baker at the law firm of Paul, Hastings, Janofsky & Walker. She also kept the books for the Irvine Health Foundation.

On June 1, Cruze was in the law office at South Coast Plaza in Costa Mesa doing some work for the foundation when she discovered two foundation checks missing.

That evening, she was called at home by Baker, who wanted to know if she would write a letter verifying a request to transfer money from the foundation's account in San Diego to the foundation's operating account in another branch in Orange County.

Instead of agreeing to do that, Cruze pressed Baker on what had happened to the missing checks.

During another telephone call that evening, Baker reportedly told Cruze not to bother coming to work anymore.

The next day, Thursday, Cruze went to the office to get her belongings. When she returned to her home, she had a message from the bank that $75,000 had been transferred from the San Diego account to the foundation's operating account.

At this point, Cruze called the chairman of the foundation's board, Judge Sills. Sills, a political ally of Baker, had been mayor of Irvine, serving on the council at the same time as Baker, and was an active Republican. He was appointed to the bench in 1986 by Gov. George Deukmejian.

When Cruze's call came in Thursday afternoon, Sills was in the middle of a trial in his seventh-floor courtroom in downtown Santa Ana. After the trial recessed, Sills called her back from his chambers.

The judge was informed of the missing checks and the transfer of the $75,000. Cruze also told Sills that Baker had fired her.

Troubled, Sills tried to call Baker, but he was out. Sills left the courthouse and drove over to the storefront campaign headquarters to wait for Baker.

Baker was not there.

Sills, forbidden by judicial rules from engaging in political campaigns, wanted to avoid any appearance of involvement with the campaign. Still, the judge, a thin, soft-spoken man, waited for Baker to return.

When Baker came in, Sills quietly questioned him.

Baker reportedly denied that he had fired Cruze and said he took the two checks (one apparently blank and one to himself for $48,000) to cover his salary and expenses as executive director of the foundation. He then apparently told Sills that he had transferred the $75,000 into the foundation's checking account for a grant program, even though the foundation ordinarily transfers money from its interest-bearing account into the checking account only a day or so before making a grant.

The meeting broke up, sources said, and Sills left unsatisfied.

On Friday morning, sources said, Baker placed a stop-payment order on the $48,000 check he had deposited in his account Wednesday. Bank records showed that Baker stopped payment before any money actually left the foundation's account. That point, says Baker's lawyer, Paul S. Meyer of Costa Mesa, supports Baker's contention that he did not break any laws.

By Friday, the $90,000 second mortgage on Baker's two-story Woodbridge home had come through.

In the meantime, Hunt, senior vice president of the Irvine Co., a member of the finance committee of Baker's campaign and a member of the health foundation board, had also heard rumors that new money had come flooding into the campaign.

Hunt, 39, is a former Republican Party activist and probably the second most powerful executive in the the Irvine Co.

Hunt, Sills and Strader, Baker's campaign chairman and a member of the foundation board, spent that hot, sunny Friday talking to each other on the phone. They called a meeting for 4 p.m. at Hunt's seventh-floor office in the Irvine Co. headquarters at Newport Center overlooking Newport Harbor.

When Baker arrived, the three board members questioned him.

Breaking down, Baker said his life was ruined. He admitted writing the $48,000 check and signing Sills' name on it as co-signer. (Only Sills, Baker and Strader could sign foundation checks, and each check required two of their signatures.)

He also told them he had transferred the $75,000 into the checking account. The three board members were aghast.

As the meeting ended, sources said, Baker was so distraught that Hunt and Strader urged him to go to the hospital.

Hunt then rode home with Baker, and Strader followed in his car. All three of them went into Baker's house and talked. Baker did not want to go to the hospital, so Hunt and Strader, chairman of the Legacy Cos. and one of the county's most influential developers, left.

Baker then left on his solitary drive around the county, returning home about midnight. About 3 a.m. Saturday he checked into Hoag Hospital.

On Saturday morning, three days before the election, Strader, 49, and Hunt quietly resigned from the campaign.

Also on Saturday, Strader, prominent in civic groups and vice chairman of the Orange County Performing Arts Center's executive committee, called another high-powered health board member, UC Irvine Vice Chancellor John R. Miltner, who was on a university retreat, to confirm Baker's forced resignation.

And Sills called a ranking official of the Orange County district attorney's office Saturday morning and told him what Baker had done.

Between the time he was hospitalized and Monday evening, Baker surfaced only once: for a fund-raising appearance Sunday afternoon in Leisure World in Laguna Hills with conservative TV and radio commentator Bruce Herschensohn.

Baker spent Monday night at home.

On Election Day, he and his wife voted at a neighborhood precinct and then returned home, where Baker made a round of calls to supporters and potential contributors. It wasn't until that evening that Baker went to his campaign headquarters, where he addressed campaign volunteers, telling them, "It's now in God's hands."

Cox surged to an early lead, but as the night wore on, Baker closed the gap, prompting him to drive from Irvine to the Doubletree Hotel in Orange, where Republicans from around the state had gathered for a post-election party. Shortly after midnight, Baker came within 401 votes of Cox. But two hours later, Baker conceded defeat, finishing 1,172 votes shy of the winner, Cox.

On Wednesday afternoon, Baker, Nakaoka and Baker's two political consultants, Frank Caterinicchio and Stuart Mollrich, gathered at Baker's house to tie up loose campaign ends. Seated at the dining room table, they discussed whether about 6,000 absentee votes that had not been counted the night before by the Orange County registrar of voters might change the outcome in the 40th District race. (They didn't.) There was also the matter of closing campaign headquarters and returning rented equipment.

They also talked about how to retire the campaign's estimated debt of $175,000.

At that point, Baker turned and stared out the window.

A resolution to the Dave Baker matter may not be known for weeks or months.

His position with the law firm for which he has worked since 1980 could be in jeopardy. Managing partners in Paul, Hastings, Janofsky & Walker are looking into allegations surrounding the foundation to determine if Baker should continue as a member of the firm. If he is dismissed, the State Bar will conduct a routine review that could result in Baker being prohibited from practicing law in California.

Even worse, the district attorney could press felony charges against Baker. That decision, according to county lawyers, will not be known for at least another two or three weeks.

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