A group calling itself The Concerned Citizens of the City of Industry had no legal standing to sue Industry for allegedly misusing public funds, a judge ruled this week.
California’s Code of Civil Procedure allows only an individual resident or a corporation that pays taxes to the city to file such a lawsuit, according to Judge Michael P. Linfield in his dismissal of the Concerned Citizens’ lawsuit on Wednesday, Dec. 2. Concerned Citizens did not qualify to bring a taxpayer action because it is a limited-liability company, Linfield ruled.
Concerned Citizens attorney David Gilmore argued the LLC should have the same standing as a corporation and that its members included former residents of the city, but Linfield said the requirements to file the lawsuit were “plain and unambiguous.”
The lawsuit accused City Council members of corruption, misuse of public funds and conflict of interest for living in subsidized housing and working for companies that contract with the city. The initial complaint alleged the city was a “criminal enterprise” and referenced the federal Racketeer Influenced and Corrupt Organizations Act, or RICO.
Though the group did eventually include at least one former resident and a former employee, emails obtained by the Southern California News Group showed, its sole member originally was a company run by William Barkett, a developer with an ax to grind against Industry. Gilmore is Barkett’s longtime personal lawyer and previously denied Barkett’s involvement.
Barkett was one of the lead figures behind a proposal to build a 450-megawatt solar farm on Tres Hermanos Ranch, a swath of 2,500 acres then owned by Industry. His company, San Gabriel Valley Water and Power, received $20 million in advances from Industry before the City Council soured on the project. The city later accused Barkett and his partner, former state Sen. Frank Hill, of siphoning the project’s funds for personal use and alleged in a civil suit that the company could not provide proof that any work had occurred.
Industry later sold Tres Hermanos to a joint partnership that includes itself and the cities of Diamond Bar and Chino Hills.
Investigations by the Southern California News Group found San Gabriel Valley Water and Power overbilled the city using altered invoices, did not disclose its ties to the city’s negotiator, and missed millions of dollars in payments to Southern California Edison despite receiving money from Industry for that purpose.
Barkett and Hill are now under investigation by the District Attorney’s Office. Their homes, along with the offices of the Cordoba Corp., a contractor involved in the deal, were raided by investigators earlier this year. No arrests have been made.
The Concerned Citizens lawsuit asked a judge to turn control of the city over to a former California attorney general who had supported the solar project while serving as Industry’s reform monitor.
Industry has alleged the Concerned Citizens lawsuit was an attempt to retaliate against the city for refusing to let Barkett’s solar project move forward. Mayor Cory Moss and Councilmen Newell Ruggles and Mark Radecki applauded the decision in a joint statement. All three were named personally in the lawsuit.
“The dismissal of this lawsuit closes a dark chapter in our City’s history,” Radecki said in a statement. “We can now move on, a bit wiser and with learned lessons about certain individuals who have consistently attempted to take advantage and distort Industry’s reputation.”
Source: Orange County Register