Nominee With Cloud of Lawsuits

One of Orange County’s most powerful figures in politics and business has been nominated as ambassador to Spain, but he is already facing some rocky relations with some unhappy tenants in his own empire of apartment buildings. As the confirmation process unfolds, it’s important that as much light be shed as possible on this prolonged dispute.

Tenants claim that George Argyros’ Arnel Management Co. cheated them out of security deposits, and the case has become such a hornet’s nest that last week Dist. Atty. Tony Rackauckas turned it over to state Atty. Gen. Bill Lockyer. That’s as it should be, and with consideration of the Argyros nomination by the Senate Foreign Relations Committee to be scheduled soon, and to be followed up by a Senate confirmation vote, a speedy investigation of the case by the attorney general is important.

The local district attorney’s role became controversial because he was perceived by critics in his own office as having too much of a personal interest. Argyros was a key supporter and campaign contributor to Dist. Atty. Rackauckas.

Prosecutors had concluded that potentially thousands of tenants could be due refunds, and Rackauckas irritated some of his own people when he called them off a civil lawsuit against Arnel and instead ordered negotiations. He argued that he did this only to get tenants refunds quickly, but his office’s discussions with Arnel failed to produce a settlement. The state attorney general’s office probably was the proper place for this case all along. In the past, it has been involved in tenant-refund cases and in assessing civil penalties where appropriate.

In addition to a class-action lawsuit that tenants filed charging Arnel with withholding security deposits for unnecessary cleanups and repairs, they also have accused the firm of discriminating against tenants with ethnic surnames.

This case involves an appointment to a country whose language is spoken by many tenants in the apartment buildings of Southern California. The case ought to get a thorough evaluation both by the state attorney general and by the U.S. Senate. It’s a matter of what’s right and honorable. If Argyros’ company has mistreated tenants, he ought to be held accountable. If his company has done nothing wrong, then Argyros’ name should be cleared. But the question ought not to be left hanging for the man who would be the next U.S. ambassador to Spain.