Fish Story a Tangle of Charges
Last fall, veteran Los Angeles Police Officer Steve J. Wynn began investigating a downtown fish wholesaler’s claim that he had been defrauded out of more than $1 million by a pair of beach-area seafood restaurants.
That is about the only thing that the parties involved in the complicated dispute agree on.
Wynn himself is now the subject of investigations by the FBI and the LAPD and has been placed on administrative leave by the department pending conclusion of an internal affairs probe, according to police officials.
The FBI investigation has included an undercover operation in which a former federal prosecutor, who now represents the restaurant owner, helped gather information by meeting with Wynn and a private lawyer while wearing a body wire provided by the FBI, according to a government source and lawyers on both sides of the dispute.
On Thursday, aspects of the labyrinthian tale began to emerge publicly as Andrew Leonard, owner of the Reel Inn restaurants, sued Wynn, the LAPD, fish wholesaler Michael Silver and Encino lawyer Richard J. Trattner, claiming that they violated his and his wife’s civil rights and engaged in a conspiracy to extort money that the couple did not owe the wholesaler.
In the civil rights and racketeering lawsuit filed in federal court in Los Angeles, Leonard’s attorneys contend that Wynn attempted to extort the restaurant owner by saying that if he paid a substantial sum to the fish wholesaler, no criminal charges would be filed.
“The defendants conspired and agreed to threaten an innocent man with jail unless he paid hundreds of thousands of dollars to defendant Silver, who . . . would have shared such a payment with defendants Wynn and Trattner,” said Leonard’s lawyers, Federico C. Sayre and Miguel G. Caballero, in the suit.
The suit further asserts that the defendants conducted an illegal criminal investigation of Leonard--including allegedly illegal searches and seizures at his businesses and Topanga Canyon home--and engaged in bribery and mail fraud.
Wynn also attempted to aid Silver in extorting money from a Hawaiian businessman in a separate case, according to the suit.
In addition, Mark Winchell, a former Silver employee, has filed a claim for damages against the city, contending that Wynn “acted under color of authority” by making false statements to obtain a warrant to search his home. Winchell’s claim also says Wynn acted improperly to protect allegedly illegal conduct by Silver.
Another Lawsuit May Be Filed
Wynn’s attorney, Michael D. Nasatir, emphatically maintained Thursday that his client has done nothing wrong.
“Mr. Wynn is an excellent police officer who was trying to do his job, and everything he did was in the interest of justice,” Nasatir said.
Silver’s attorney, Stanley I. Greenberg, said Leonard’s lawyers “are trying to portray a perpetrator as a victim.” Greenberg maintained that his client, owner of M&M; Foods and Quality Fish Inc., actually was the victim in his dealings with Leonard. “We believe the evidence will verify that Mr. Silver was defrauded out of $1.4 million and 100 tons of fish. This is based on evidence discovered after [financial] irregularities were brought to his attention last fall.”
Greenberg said Silver plans to file his own civil suit against Reel Inn owner Leonard, whose modestly priced restaurants are on Pacific Coast Highway in Malibu and at Third Street Promenade in Santa Monica.
Trattner’s attorney, Joel Levine of Encino, said, “Even though we have not had an opportunity to review the lawsuit, we are generally aware of the allegations, and we believe there is a complete defense and explanation for anything that is alleged in the lawsuit.”
Neither the LAPD nor the city attorney’s office had any immediate comment on Leonard’s suit.
FBI spokesman Matthew McLaughlin in Los Angeles confirmed Thursday that “we are investigating” but added that because the probe is pending he could not comment further. A spokesman for the U.S. attorney’s office declined to comment.
Federal sources said the government probe began several months ago and is continuing.
Leonard’s lawyers allege in the suit that, starting in 1995, Silver engaged in a scheme to defraud customers, including the Reel Inn, by “paying substantial kickbacks” to employees of these customers if they purchased seafood from Silver’s business.
The lawsuit charges that Silver repeatedly charged Reel Inn 10% to 20% more than industry average market prices by inflating invoices and misstating the amount, quality and type of fish delivered.
According to the suit, Reel Inn employee Paul St. Clair Perez was paid more than $200,000 in kickbacks by Silver. Perez’s attorney, Gary Moss, said Thursday that “the representations concerning Mr. Perez . . . I find to be at best disingenuous.”
Leonard’s lawsuit also alleges that during an October 2000 meeting at Silver’s East 21st Street office, the Los Angeles fish wholesaler told Perez he had learned that the Reel Inn had not been paying the full price for its fish and he threatened to call police unless Perez paid him $100,000. When Perez refused to pay, Wynn appeared at Silver’s office within minutes after a call from Silver and threatened to have Perez prosecuted, the suit says.
Later that month, Wynn went to the Reel Inn restaurants and started interviewing employees about a possible criminal investigation. Soon thereafter, Wynn told Leonard that if he paid the fish wholesaler the criminal probe would end, according to the suit.
The restaurateur refused to pay, and Wynn went to a Los Angeles Superior Court judge and obtained search warrants for the Reel Inn restaurants, Perez’s home and the homes of two former Silver employees.
Two affidavits submitted to a judge under oath last year by Wynn, in order to obtain search warrants, present a dramatically different story from Leonard’s lawsuit. But while generally painting Silver as the victim, the first affidavit says Perez admitted receiving weekly cash kickbacks from Silver “for continuing to purchase from Quality Foods Inc. rather than going to another supplier.”
Wynn also wrote that he believed Perez and two of Silver’s employees conspired to embezzle money from Silver by altering invoices.
A second search warrant affidavit submitted by Wynn quotes two of Leonard’s former employees as saying their boss knew about Perez altering invoices because they attended meetings at which Leonard reviewed the invoices and asked questions about particular items.
However, in interviews with The Times, both women said their positions had been mischaracterized. Honey Glick and her daughter Robin Gavin said they consider Leonard an honest man. Glick described him as basically an “absentee owner” who spent little time at the restaurant and reviewed the invoices in a perfunctory manner.
FBI Launches Investigation
In December, after police searched his home, Leonard and his wife, Jessie, hired Manuel A. Abascal, a former prosecutor in the U.S. attorney’s office in Los Angeles who is now in private practice. Abascal said in an interview that he hired accountants and private investigators and that eventually he concluded that the Leonards had been seriously wronged.
He went to federal authorities, and earlier this year the FBI launched its investigation. Leonard’s lawsuit states that Abascal initiated actions in several instances at the FBI’s direction.
The suit describes meetings that Abascal said he had with Wynn and Silver attorney Trattner to discuss the money dispute between the restaurant owner and the wholesaler.
According to Leonard’s suit, Trattner said at a Jan. 15 meeting that Silver did not plan to sue but instead was working with the district attorney’s office and that, “if Leonard did not pay immediately, he would be prosecuted and would have to pay through a restitution order once he was in jail.”
Trattner said that he would settle the dispute for $750,000 but that if the sum was not paid within seven days the price of a settlement would increase by $250,000 a week, according to the suit.
Wynn also “assured attorney Abascal that a ‘settlement’ would end the criminal investigation,” the suit says.
In March, Abascal, at the behest of the FBI, made two offers to “settle” the case, first for $150,000 and then for $500,000, according to the suit. Trattner accepted the second offer, the suit states, but the deal was not consummated. Instead, the FBI confronted Silver, Trattner and Wynn and executed a search warrant at Silver’s business in early April, according to the suit and several sources.
Los Angeles County Deputy Dist. Atty. Richard Lowenstein, who works in the agency’s major fraud unit, said he was not familiar with the Leonard case. But he said that because of a lack of resources, the district attorney’s office and the LAPD frequently use private attorneys to assist them in complicated cases dealing with allegations of financial crime.
While not commenting on the current case, Lowenstein added that it is not proper for a law enforcement official to tell an individual that a potential criminal case will be dropped if a civil settlement is reached.
“That you should not do,” Lowenstein said. “The likelihood of whether someone will be prosecuted is totally independent of whether there is a civil settlement. That is a decision based on whether there is a crime.” However, he added that “as a practical matter . . . if things have been settled, that is taken into consideration of how strong a case is.”
*
Times staff writer Matt Lait contributed to this story.
