Gillespie Is Prodded to Remove Hearing Judge : Insurance: Van de Kamp demands ouster of jurist whose wife works for a law firm that defends major insurer companies.

Atty. Gen. John K. Van de Kamp demanded Friday that Insurance Commissioner Roxani Gillespie remove the hearing judge she selected to recommend state standards for insurance company profits, declaring that there is a strong appearance of impropriety in the judge’s conduct and relationships.

Van de Kamp, flanked at a Los Angeles news conference by Voter Revolt leader Harvey Rosenfield and Consumers Union attorney Nettie Hoge, said that Administrative Law Judge William J. Fernandez’s wife works for a leading insurance company defense law firm. He also said Fernandez had been holding settlement conferences outside court with industry lawyers.

“The insurance rates the judge is setting will be going in part to pay his wife’s law firm and thus, indirectly, the judge himself,” the attorney general said, adding that he was filing a formal motion for Fernandez’s dismissal.

Rosenfield said that Fernandez last weekend invited two insurance company attorneys and two ranking Department of Insurance officials to golf and dine with him. “Is he biased in favor of his golf buddies?” Rosenfield asked.

Fernandez was not available for comment Friday.

The more than four months of hearings Fernandez presided over have been completed, but Van de Kamp, Rosenfield and Hoge called on Gillespie to dismiss the judge before he writes his recommendations. They said she should reach her own conclusions on the standards, based on the record of the hearings.

Gillespie said later that she would not dismiss the judge. And one of her attorneys, Chris Maisel, suggested that if she did, the way might be opened for insurance companies to claim that she was violating due process.

A statement issued by the Department of Insurance declared:

“Gillespie has not yet had an opportunity to study the motions (of impropriety), so will not comment on their merits. However, she is very distressed these motions are supported by the attorney general’s office, giving reason to believe that the action is politically motivated and tied to his upcoming campaign for governor.”

Van de Kamp is running for the Democratic gubernatorial nomination. Gillespie is an appointee of Republican Gov. George Deukmejian, who is not running for reelection.

Fernandez was said to be out of the state attending a friend’s funeral. Two weeks ago at the hearings, however, the judge had angrily left the bench, cast off his coat and rolled up his shirt sleeves while advancing on consumer representatives to deny earlier motions of bias they had filed against him.

The attorney general’s statements Friday were filled with suggestions that Gillespie has been unconscionably delaying ordering the insurance rate rollbacks called for under Proposition 103. He said the hearings she had called were “tedious” and “completely unnecessary.”

Van de Kamp said he was “startled” to learn that the hearings “are being conducted by a judge who should never have been assigned to this case--and who must now be removed from it.”

He said the judge’s wife, Judith Fielding, is a lawyer for the Bay Area law firm of Ropers, Majeski, Kohn, Bentley, Wagner & Kane, whose primary business is defense work for “17 different insurance companies, a virtual who’s-who of the industry,” including such major sellers as Farmers, State Farm and Travelers. The law firm, he added, filed a brief arguing for the industry that Proposition 103 was unconstitutional.

“We are not alleging that Judge Fernandez is corrupt or biased,” said Van de Kamp. “We don’t know--and could never know--whether his wife’s ties to the insurance industry have influenced his judgment on the issues before him.

“However, the law requires that a judge remove himself whenever there is an appearance of impropriety. In this case, the appearance of impropriety could scarcely be stronger.”

Fielding was not available for comment, but one of her firm’s senior partners, Eugene Majeski, said: “There is no conflict, because she runs her own practice and he runs his judging.”

Majeski said the firm of 120 lawyers “has a broad insurance practice, but also many non-insurance clients.” Fielding, he added, “primarily works in medical malpractice cases.”

On the issue of the settlement conferences, Van de Kamp observed that his attorneys at the hearings had refused to let their expert insurance witness, Robert Hunter, hold private meetings with the judge, viewing such unrecorded sessions as improper.

Meanwhile, on the golf game questioned by Rosenfield, two attorneys among the judge’s invitees--Kent Keller, representing the Travelers company, and Maisel, representing the Department of Insurance--confirmed that the judge had asked them to a private golf tournament he staged on the Stanford course over the weekend, and later to dinner at his home.

They said in separate interviews that the judge had stressed to them that nothing related to the hearings would be discussed and that nothing was.

Keller and Maisel said Fernandez had not invited any of the consumer representatives at the hearings, because none of them play golf. They said he did try to invite Steven Miller, head of the Insurance Consumer Action Network and a consultant in the hearings to the Insurance Department, but that Miller could not come.

Later, Amy Bach, a Voter Revolt lawyer who has been at the hearings, said she plays golf and was not invited.