U.S. Judicial Nominee’s Ties to Gallo Family Questioned

U.S. Sen. Dianne Feinstein, no stranger to political largess from the Gallo wine empire here, has nominated for federal judge a longtime Modesto attorney who is related to the Gallos by marriage.

If the nomination of Frank Damrell Jr., 58, passes White House and Senate muster, it would be the third time in recent years that a high profile attorney with professional or personal ties to the Gallos has been named to the U.S. District Court for the Eastern District of California.

It is this court, with seven judges in Sacramento and Fresno, that most often hears lawsuits involving Gallo trademark and contract disputes.

Damrell’s supporters say the respected attorney and longtime financial contributor to the Democratic Party is a perfect choice for the federal bench, a Yale Law School graduate with criminal and civil law experience who holds moderate views.

Critics of the nomination say they are troubled that another candidate for federal judge in the Central Valley enjoys close ties to the powerful wine barons, one of the nation’s biggest private donors to Feinstein and other politicians. They point out that Damrell would sit on the court’s Sacramento bench, which has jurisdiction in several counties where the Gallos have extensive business dealings.

Damrell, a college roommate of former Gov. Edmund G. “Jerry” Brown Jr., is related to the Gallos through his sister Marie’s marriage to Bob Gallo, a president of the winery and Julio Gallo’s oldest son. Besides his family ties, Damrell has served as legal counsel to the winery, one of the largest privately owned consumer product companies in America.

“Because the Gallos are my family and my clients, I’ll recuse myself from any cases involving their business dealings,” Damrell said. “The bottom line is there’s no benefit to the Gallos if I’m selected.”

But others disagree, saying that Gallo’s interests throughout the state are so vast and varied that if Damrell handles any water or environmental cases on the court, his rulings could affect the winery.

“Even if he intends to recuse himself on specific Gallo-related cases, the spectrum of issues that are likely to come before a judge in the Central Valley will inevitably have consequences for Gallo winery and its plans for the future,” said Ellen Hawkes, author of “Blood and Wine,” regarded as a definitive account of the Gallo wine empire.

In a letter to Feinstein in January, Ernest Gallo made his preference clear. “I have known Mr. Damrell for many years. I greatly value his abilities as an attorney and have found his judgment and integrity to be of the highest order,” wrote the 88-year-old chairman of E & J Gallo Winery. “I believe he would be an outstanding choice for this most important office.”

Hawkes said it was hard to overestimate the sway of Gallo’s letter. “Ernest does not write letters of recommendation lightly. The letter may be short but the effect may be quite long.”

Gallo’s office did not respond to requests for comment.

Damrell said the kinship should have no bearing on his worthiness to fill one of 94 federal court vacancies nationwide. “I have great respect for Ernest Gallo. I wouldn’t have asked him for his assistance if I didn’t,” he said.

“But I think it is demeaning to me to suggest that one person is controlling my destiny. It totally ignores what kind of lawyer I am and the broad support I have from both sides of the political fence.”

A spokesman for Feinstein said Damrell was selected from a final list of four candidates because of his impressive legal credentials. The spokesman said the nomination was in no way tied to the $32,000 in contributions to Feinstein by Gallo family members and the company since 1991.

“As far as his relationship with the Gallos, that had absolutely nothing to do with the appointment,” said Bill Chandler, who oversaw the judicial selection process for Feinstein. “Frank Damrell is not a one-issue lawyer but someone who has an incredibly varied mix of civil and criminal experience that makes him an outstanding nominee.”

Damrell may boast all the right stuff to be named a federal judge, and certainly the letters on his behalf--from California Agriculture Secretary Ann Veneman to San Francisco 49ers President Carmen Policy--speak of his distinguished years as a local and state prosecutor before building his own top law practice in Modesto.

But it has long been suggested in the legal community here that for any attorney coveting a federal judgeship in the Central Valley, one endorsement stands taller than the rest: a thumbs up from the Gallos.

The Gallo family is the largest corporate donor to congressional candidates in California and ranks in the top 20 nationwide. The single largest financial backer of Bob Dole during his long career in the U.S. Senate, the Gallos now rank fifth on the list of all-time donors to President Clinton.

Over the years, friendly lawmakers have pushed a number of bills tailored to benefit Gallo family members exclusively with tax breaks and other subsidies amounting to tens of millions of dollars.

Ernest Gallo is credited by Feinstein campaign aides with helping soften the senator’s big city, liberal image among the state’s agricultural giants. Two years ago, in her mega-money campaign against former Rep. Michael Huffington of Santa Barbara, Feinstein received one-fourth of her money from political action committees, including a number that represented Central Valley cotton, citrus, dairy and wine producers.

It was during this campaign that Feinstein became a vocal supporter of the Market Promotion Program for wine exporters, which critics have derided as an example of “corporate welfare.” The program has provided the Gallo winery with at least $24 million in government subsidies to market its products overseas. Three years ago, government accountants concluded that the program had yielded no tangible results for America as a whole.

In June, Ernest Gallo’s ties to Feinstein were further evidenced when he was one of 50 guests invited to a $50,000-per-person dinner with Clinton at the San Francisco home of Feinstein and her husband, Dick Blum.

The dinner has come under scrutiny because it was held six days after the FBI warned the White House that China was eager to buy influence in the United States through targeted politicians, such as Feinstein. One of the guests who broke bread with Clinton at the senator’s house was the head of a Chinese company with close ties to Chinese leaders.

Compared to the supercharged air of presidential hobnobbing, the selection of a federal judge in one district of California might seem like a small item with uncertain long-range benefits. But family and friends have portrayed Ernest Gallo as a farseeing businessman who attends to just such detail.

In 1979, Edward Dean Price, a Modesto attorney with personal and professional ties to Gallo, was nominated by then Sen. Alan Cranston to fill a position on the federal court in Fresno. Price belonged to the same country and civic clubs as Ernest and Julio Gallo and attended two family weddings.

It was Frank Damrell Jr. who introduced Price to Cranston before the judicial nomination. Damrell was the perfect conduit, enjoying a friendship with both the senator and the future judge.

“I hosted several fund-raisers for Cranston, and I’m sure Dean Price was at more than one of them,” Damrell said. “I recommended Dean Price for the job. Absolutely. I wrote a letter on his behalf.”

Not long after Price was seated on the bench, Gallo sued his younger brother, Joe, for using the Gallo name on his cheese products. Through random draw, the lawsuit in the federal court’s eastern district was assigned to Price.

Price made two rulings in favor of the winery, one of them dismissing Joe Gallo’s claim that he held a one-third interest in the winery by virtue of his parents’ estate. Then on the eve of the cheese trial, under questioning by a Modesto Bee reporter, Price publicly acknowledged his personal and social ties to Gallo winery and excused himself from the case.

“Joe Gallo’s son accused me of being biased, which wasn’t true,” Price recalled. “But as soon as he made that accusation to a local reporter, I recused myself without a formal request from either side.

“The Gallos and I belonged to the same clubs, and I attended two of the family weddings. But my relationship with them was nothing more than casual,” he said. “If either Ernest or Julio wrote a letter supporting my nomination for judge, it was not written on my request. Maybe someone else asked them.”

Several years before the cheese case came to court, according to Hawkes’ book, Price sat on three cases in which the winery was alleged to have engaged in bad faith business dealings.

In each of the three cases, the dispute landed in the federal court in Fresno because Gallo contracts stipulated that any legal disputes would be adjudicated there. In each case, according to Hawkes, Price made a key decision from the bench favoring the winery.

Price retired in 1989 and was replaced by another prominent Central Valley attorney with ties to the Gallo winery: Oliver W. Wanger. Indeed, Wanger was part of the team that represented the winery in its successful trademark lawsuit against Joe Gallo’s cheese.

Wanger’s succession of Price had some locals clucking that one of the two full-time seats on the federal bench in Fresno was the “Gallo seat.”

“I don’t recall if Ernest Gallo wrote a letter on my behalf or not,” said Wanger, who was nominated by then Sen. Pete Wilson and remains on the bench. “I only worked with Ernest Gallo in the context of the Joe Gallo case. I would not say that he was a factor in my nomination at all.”

Now, with Damrell’s nomination, some legal experts are wondering if a pattern has emerged. While not disputing Damrell’s qualifications, they said the selection of another judge with Gallo ties would further skew the court’s makeup.

“Fishing in the same small pool for federal judges is not taking advantage of the diversity of lawyers out there,” said John Sims, who teaches constitutional law at McGeorge School of Law in Sacramento. “We have too many judges already from the high-income, high-prestige corporate sector of the bar.”

Others note that the Gallo winery is a frequent litigant in federal court. With Damrell and Wanger recusing themselves from Gallo cases, the operation of the seven-member bench in the eastern district could be adversely affected. And given the breadth of Gallo’s interests, legal experts agreed that Damrell might very well rule on water, environmental and trademark cases that could affect the winery.

“All this presents a question for President Clinton,” said J. Clark Kelso, a government affairs expert who also teaches at McGeorge. “Should a significant portion of your federal bench in one region of California have ties to the Gallo family?”

The son of cheese maker Joe Gallo sees the long hand of his uncle, Ernest Gallo, in Damrell’s nomination. “Ernest plans way ahead and his support of Damrell is part of those plans,” said Mike Gallo. “Even if Damrell removes himself from Gallo cases, there will be other decisions that could indirectly affect the winery.

“Having family on the court isn’t a bad bet.”

With a backlog of federal judge candidates awaiting Senate confirmation, Damrell is hopeful that his bipartisan support and letters attesting to his integrity and legal skills will push him through.

“I would be leaving what is a very lucrative practice to do some thing that is very meaningful for me,” he said. “My father was a Superior Court judge for a number of years and this has been a dream of mine.”