Los Angeles seeks millions of dollars in penalties from outdoor ad firm

The city of Los Angeles is demanding millions of dollars from a Beverly Hills-based outdoor advertising company, saying the company’s top executive lied to a judge and illegally wrapped 17 buildings with towering supergraphic advertisements.

In court documents filed Friday, City Atty. Carmen Trutanich accused SkyTag president Michael McNeilly of depriving the city of fees, endangering the public and committing perjury during a recent legal fight over the city’s billboard laws.

Given the number of signs that are at issue, potential penalties in the case are “in the tens of millions of dollars,” said William Carter, Trutanich’s chief deputy. Trutanich said he wants $2,500 for each day that a violation was committed by SkyTag, which has been at odds with the city for roughly a decade.

The lawsuit drew praise from Dennis Hathaway, president of the Coalition to Ban Billboard Blight, who said SkyTag “deliberately flouted the law for a profit — a lot of profit.” Hathaway said SkyTag executives knew they would face minimal fines while reaping hundreds of thousands of dollars monthly in ad revenue.

McNeilly said his company followed a judge’s orders throughout the litigation. “We went by the rules,” he said. SkyTag became well known in 2009 after it placed multistory images of the Statue of Liberty on office buildings in Hollywood, Westwood, the Miracle Mile and several other parts of the city. The company’s graphics also advertised an array of products, including the movies “Clash of the Titans” and “Alvin and the Chipmunks: The Squeakquel,” according to the lawsuit.

Those images were erected in the middle of a hard-fought legal battle with the city. In one court filing, McNeilly told a federal judge that he had placed supergraphics on 118 separate buildings — and needed an injunction to keep them there while he waged his case.

After SkyTag filed its documents in court, The Times visited each of those 118 locations and found that more than two-thirds did not have images of any kind on them. Of the remaining addresses, several had SkyTag posters — some of them only 4 feet by 4 feet — instead of supergraphics.

After The Times reported those details, U.S. Dist. Judge Audrey Collins threw out 85 locations where McNeilly wanted the right to maintain supergraphics, saying his claims approached an “outright falsehood.” But she did issue an order giving him permission to keep signs at 20 addresses.

Billboard foes accused McNeilly of trying to mislead a judge into granting permission for scores of lucrative supergraphics that had been outlawed. McNeilly disputed Trutanich’s perjury allegation, saying the buildings cited in his lawsuit had “place holders” and “not necessarily large-scale supergraphics.”

“It’s how you want to interpret it, I guess,” McNeilly said. “I don’t think Judge Collins called it perjury.”

SkyTag ultimately failed to persuade the U.S. 9th Circuit Court of Appeals to strike down the city’s billboard laws. McNeilly said any unpermitted signs came down after the city prevailed in court.

david.zahniser@latimes.com