A San Bernardino County judge Wednesday threw out key portions of a sweeping business corruption case involving trash giant Waste Management Inc. and its failed attempt to build the world's largest landfill in the Mojave Desert.
Superior Court Judge Joseph E. Johnston dismissed all nine criminal counts alleging securities fraud against Waste Management, three of its former executives and a county employee also charged in the case.
Johnston also dismissed all remaining charges against former Waste Management Vice President Robert Morris, making him the second company official to be removed from the case.
"We do think we gutted their case," said Fred Friedman, an attorney for Waste Management.
A grand jury last fall indicted Waste Management and five individuals on charges of plotting to destroy the dump project's main opponent through a campaign of corporate espionage, disinformation and dirty tricks. The charges stemmed from Waste Management's efforts to neutralize the anti-dump activities of Cadiz Inc., a Santa Monica-based produce grower that fought the dump to protect its desert farm and the underlying ground-water supply.
After securing most of the needed approvals, Waste Management abandoned the project in 1996 after the criminal probe began.
Wednesday's ruling left Waste Management, former company officials Stu Clark and Glen Odell, and former county employee Philip E. Smith still facing 11 felony counts, including charges of stealing trade secrets and preparing false evidence.
But the stock fraud charges--stemming from purported efforts to weaken Cadiz by sinking its stock price--carried the most severe penalties and were the heart of the case. If convicted, Waste Management faced fines of up to $10 million on each of the nine counts.
San Bernardino County Deputy Dist. Atty. Grover Merritt acknowledged that the ruling was a blow to the case, but he said authorities haven't given up. "We put a lot of work into it and we disagree vehemently with the judge's decision," Merritt said. "At the moment, we're strongly leaning toward refiling" the criminal charges.
Brian Hennigan, attorney for Morris, described his client's dismissal as "a vindication from the court," and said Morris "is delighted with the result."
Earlier this month, Johnston dismissed all charges against Harold Cahill, another former Waste Management official.