Payment to End Hedgecock’s Legal Saga

Sweeping away the last vestige of one of San Diego’s most convulsive political scandals, the state Fair Political Practices Commission on Tuesday agreed to drop its nearly $1-million campaign-corruption lawsuit against former Mayor Roger Hedgecock in exchange for a $30,000 payment from Hedgecock, now a radio talk show host.

The settlement, announced late Tuesday by FPPC Chairman Ben Davidian, is unprecedented because it requires the payment from Hedgecock but absolves him of any liability for violations of campaign donation limits and public disclosure laws. FPPC settlements routinely require such admissions of liability from politicians named in enforcement actions.

Davidian, an attorney who personally handled portions of the settlement negotiations, declined to say why he and fellow commissioners agreed to the unusual terms or the amount of Hedgecock’s payment, which was carefully characterized in a press release to avoid the word fine .

But he added that it is time to end the “bizarre case” that has dragged on after exacting its toll on Hedgecock and the public.

“Mr. Hedgecock lost his position as mayor. He had to resign,” Davidian said. “He was prosecuted twice in criminal court. This case has been going on for seven or eight years. It has been a tremendous burden on the taxpayers and on Mr. Hedgecock.

“This case is the longest(-running) case in the history of the FPPC. There is no question in my mind that justice has been done in this case,” Davidian said.

Hedgecock could not be reached for comment late Tuesday, but his San Diego attorney, Leo Sullivan, said the settlement is “fair in all respects to everyone.”

Dismissal of the dormant FPPC lawsuit removes any vestige of court action facing Hedgecock, now a popular talk show host on KSDO-AM radio, stemming from a scandal over his personal and political finances.

Allegations that he and his political supporters illegally laundered more than $350,000 for use by his 1983 mayoral campaign resulted in two criminal trials, conviction on 13 felonies and his ouster from the mayor’s office in 1985.

Since then, Hedgecock has waged a hard-fisted legal fight to clear himself of the highly publicized criminal charges. Last year, the California Supreme Court threw out the 12 felony perjury counts against him.

The remaining felony conspiracy charge was sent back to Superior Court for a hearing on Hedgecock’s claim that a court bailiff improperly talked to jurors about the case during his second criminal trial.

Hedgecock and the San Diego County district attorney then agreed to a settlement that called for a guilty plea to one felony count, which was later reduced to a misdemeanor, and at year’s end was dismissed entirely from his record.

All that remained was the FPPC case, which was filed with much fanfare in October, 1984--a month before Hedgecock was reelected as mayor. The FPPC generally handles violations administratively; such civil lawsuits are rare, and intended to make a particularly strong point about what the FPPC sees as political rule-breaking.

The $1.3-million suit asked for $975,000 from Hedgecock personally for allegedly concealing gifts on his public disclosure statements and violating city campaign limits through illegal donations to his mayoral campaign.

In all, the massive case named Hedgecock in 44 of 50 causes in action, and alleged 450 violations of state disclosure and campaign laws by the former mayor and his supporters: San Diego banker Peter Q. Davis; political consultant Tom C. Shepard; ill-fated La Jolla financier J. David (Jerry) Dominelli and his then-girlfriend, Nancy Hoover Hunter, and Otay Mesa landowner Roque de la Fuente.

The agency decided to file the unusual suit before Hedgecock’s reelection because of the “overriding obligation” to inform the public, then-FPPC Chairman Dan Stanford said at the time. He added that the suit was backed up by the agency’s “most complicated and exhaustive” probe ever.

Hedgecock countered at the time with a prediction that came mostly true Tuesday: “We’ll never pay a fraction of the money . . . “

Stanford’s eventual successor said Tuesday that the facts of the FPPC case did not live up to the original billing.

“I do not deem this a $1.3-million case,” said Davidian, who was appointed agency chairman earlier this year by Gov. Pete Wilson.

Until recently, the FPPC case against Hedgecock languished in the file cabinets of the agency because of a court-ordered stay that prohibited any further fact-gathering until the criminal proceedings were settled. Sullivan said he called the FPPC and broached the subject of a settlement last fall when it appeared the criminal case would be wrapped up.

Sources familiar with the case said Hedgecock’s attorneys raised the question of whether the agency goofed by not moving sooner to lift the stay after the mayor’s criminal trials, running afoul of a five-year deadline for civil litigants to press their cases.

Davidian, however, said the agency was bound by court order to wait. “We were precluded from doing anything on the case from 1985 until . . . the criminal case was resolved,” he said.

The FPPC press release Tuesday said the $30,000 payment to close the case will come from Hedgecock and his co-defendants, but the sources said Hedgecock has agreed to pay all of it.

Two of the co-defendants on Tuesday welcomed news of the settlement, which clears all of them.

“If they’re now going to drop me, asking for no money or no statement, then clearly I should never have been in” the lawsuit, said Davis, Bank of Commerce president and former treasurer for Hedgecock’s campaign. “My position has always been that I’m not going to pay anything, I’m not signing anything and I’m not going to court.”

Political consultant Shepard added: “This hasn’t been weighing on my mind, to be honest. But I think in general that the whole series of events is ripe for closure and has pretty much achieved closure in San Diego.”