Thousands for defense. . .

The same forces – primarily, labor unions and Democratic party stalwarts – that paid to get Malia Vella and Jim Oddie elected to Council now are financing their defense against the charge that they attempted, in violation of the City Charter, to strong-arm the City Manager into appointing the former president of the firefighters’ union as Alameda fire chief.

The legal representation for the Council members, provided by separate politically well-connected and (dare we say it) high-priced law firms, hasn’t come cheap:  both Ms. Vella and Mr. Oddie have spent all of the money given by their union and party friends to their campaign committees in 2017 on legal fees – nearly $50,000 between the two of them.  And Mr. Oddie still owes his lawyers another seven grand.

The campaign finance disclosure statements filed by the two Council members tell the story.

Ms. Vella was elected in November 2016 and is not up for re-election until 2020.  Nevertheless, in early 2017, she renamed her campaign committee “Malia Vella for Alameda City Council 2020” and began accepting contributions for her next race.  During the first nine months of the year, only one individual and one union heeded the call and donated money (a total of $3,000).

Then, on October 12, the East Bay Times broke the story about the alleged meddling by Ms. Vella and Mr. Oddie in the appointment of a new fire chief to replace retiring Chief Doug Long.  The article cited a letter written by City Manager Jill Keimach to Council in which she detailed “intense and unrelenting pressure” exerted on her by “elected and appointed officials in Alameda and even at the State level” to give the job to the candidate being pushed by the local firefighters’ union, its former president Domenick Weaver.  The article also relayed Police Chief Paul Rolleri’s account of a conversation in which Mr. Oddie told him that “[t]here are already two council members who are ready to fire” Ms. Keimach if she didn’t kowtow to the union’s demand.

If the allegations are true, the conduct by the two Council members would run afoul of section 7.3 of the City Charter, which states that any “attempt by a Councilmember to influence the City Manager in the making of any appointment . . . shall subject such Councilmember to removal from office for malfeasance.”

In response to the story, City Attorney Janet Kern decided to hire an outside law firm to investigate, and Council ratified the decision in a closed-session meeting on October 17.  The next day, Ms. Vella issued a press release expressing support for an independent investigation and declaring, “I am absolutely confident that the investigator will find the allegations that have been made against me to lack any basis in reality and that I will be cleared of any wrongdoing.”

Less than two weeks later, the funds began to flow into Ms. Vella’s campaign account.  Between October 28 and December 14, she received $19,000 in cash contributions, of which $14,000 came from unions or other labor organizations.  (This ratio was a bit higher than it had been in the 2016 election, when Ms. Vella got 62 per cent of her campaign funds from organized labor.)

The state Teamsters “Public Affairs Council” and the Oakland Teamsters local led the pack with donations of $2,500 apiece.  Five other labor organizations also contributed cash.  As the chart below shows, six of the seven benefactors also had given money in 2016 either directly to Ms. Vella, or to “Alamedans United,” the PAC formed to elect a pro-developer, pro-union slate that included her, or to both:

Labor Organization Contributions to Vella Campaign After October 12, 2017 Contributions to Vella Campaign in 2016 Contributions to “Alamedans United” in 2016
San Francisco Firefighters PAC $2,000 $2,000
IAFF Local 55 PAC $1,000 $2,000
Teamsters Local 853 PAC $2,500
Service Employees International Union Local 1021 PAC $2,000 $2,000
California Teamsters Public Affairs Council $2,500 $5,000
Sprinkler Fitters and Apprentices Local 483 $2,000 $1,000 $5,000
Alameda Labor Council Unity PAC $2,000 $4,200

Individuals or organizations with political ties – or ambitions – supplied most of the rest of the cash.

The first contribution to Ms. Vella after publication of the East Bay Times article – for $1,000 – came from the campaign account of Alameda School Board member Gray Harris, who is married to firefighters’ union president Jeff DelBono and who delivered a speech denouncing Ms. Keimach at the same meeting at which Council approved hiring an independent investigator.  In addition, Boxer & Gerson, the San Francisco law firm founded by Senator Barbara Boxer’s husband, donated $2,500, and one of its partners, workers’ comp specialist Dennis Popalardo, put in $500 on his own.  Mr. Popalardo finished last in the race for the Alameda School Board in 2016, but he recently applied for, and was appointed to, the Alameda Hospital District board, a traditional stepping stone toward a Council seat.

Ms. Vella’s latest campaign disclosure statement lists only one recipient of funds from her campaign account:  the San Francisco law firm of Coblentz, Patch, Duffy & Bass, LLP.

The firm was founded by the late Bill Coblentz, whom the New York Times described in an obituary as a “California power broker” with “political roots in the administration of Gov. Pat Brown,” who had “developed a reputation as one of San Francisco’s most adroit land-use lawyers, helping steer major projects . . . through the regulatory labyrinth.”  (He also defended Patty Hearst.)  A Coblentz partner, William H. Orrick III, was nominated by President Obama to the federal district court bench, where he gained renown recently by striking down the Trump administration’s travel ban.

The disclosure statements show that, through December 31, Ms. Vella has paid $22,000 to the Coblentz firm.  The payments are categorized as “LEG” – i.e., “legal defense.”  Since we don’t know of any other matter for which Ms. Vella has retained counsel, we can only assume that this payment relates to the investigation of her alleged interference in the appointment of the fire chief.   We sent Ms. Vella an email asking her to confirm this, but she did not reply.  (Mr. Oddie likewise did not reply to our similar email.)

Mr. Oddie took in almost exactly as much money for his campaign account as Ms. Vella did after the allegations of misconduct surfaced, and he found it in similar places and spent it in similar ways.

The Councilman, whose “day job” – as he likes to call it – is aide-de-camp to State Assemblyman Rob Bonta, was elected in 2014, having received 39 percent of his campaign funds from labor organizations.  In November 2015, he formed a new campaign committee in anticipation of a run for re-election in 2018.  During the next 18 months, he raised about $10,000, thanks in part to a fundraiser sponsored by the firefighters’ and police officers’ unions.

After the East Bay Times story hit, the flow of cash into Mr. Oddie’s campaign account took off.

The largest contributor was the Councilman’s boss, Assemblyman Bonta, who kicked in $5,000 from his 2018 campaign fund.  Mr. Bonta had been Mr. Oddie’s biggest financial backer in the 2014 Council campaign, donating a total of $7,500 from his own campaign account.

Four labor organizations, three of which also donated to Ms. Vella after the East Bay Times story was published, came up with another $6,500.  As was the case with his colleague, all but one of these groups also had backed Mr. Oddie financially in his successful Council race:

Labor Organization Contributions to Oddie Campaign After October 12, 2017 Contributions to Oddie Campaign in 2014
Northern California Regional Carpenters $1,500 $1,000
Service Employees International Union Local 1021 PAC $2,000 $1,000
Alameda Labor Council Unity PAC $2,000 $1,000
California Teamsters Public Affairs Council $1,000

In addition, the Boxer & Gerson law firm, which had given Ms. Vella $2,500, donated $1,000 to Mr. Oddie.  (Nothing from Mr. Popalardo, however).  And a pair of Mr. Oddie’s corporate contributors in 2014 also ponied up:  a company called “ARDA,” which had given $5,000 to Mr. Oddie in 2014, contributed $2,000; and U.S. Freight Systems, which had given $1,000 in 2014, contributed the same amount.

All told, Mr. Oddie collected $18,900 between October 23 and December 22.  This is less than the $27,097.50 that, according to his latest campaign disclosure statement, he has paid so far to the San Francisco law firm of Keker Van Nest & Peters, LLP for “legal defense.”  Presumably, the preexisting cash balance in Mr. Oddie’s campaign account was used to cover part of his legal bills.  But the disclosure statement shows that he still owes his lawyers $7,086.70 for services rendered.

Keker Van Nest & Peters is no stranger to Democratic politics – or to Alamedans.

The firm was founded by John Keker, a highly regarded trial lawyer specializing in white-collar criminal defense who counts House Speaker Nancy Pelosi among his oldest friends and who contributes regularly to Democratic candidates.  (In the 2016 election cycle, individuals from the Keker firm collectively gave $139,171 to Democrats – and nothing to Republicans.)  Mr. Keker also happens to have been the lawyer who represented the plaintiffs in the case in which Judge Orrick, the ex-Coblentz partner, invalidated the Trump travel ban.

Locally, the Keker firm is best known for representing former Councilwoman Lena Tam, who was accused in 2010 of leaking confidential information to SunCal and the firefighters’ union.  Mr. Keker successfully argued to Alameda County District Attorney Nancy O’Malley that Ms. Tam’s alleged misconduct did not constitute a crime and therefore it furnished no basis for removing her from office.  After Ms. O’Malley announced her decision not to bring the matter before a grand jury, Ms. Tam submitted Mr. Keker’s bill for $44,000 to Council, which paid it with City funds.

We would be the last to criticize Ms. Vella or Mr. Oddie for seeking top-drawer legal advice, especially if they don’t have to pay for it out of their own pockets.  Nor do we question their judgment in getting the lawyers involved at the very beginning of the investigation.  In that regard they’re acting no differently than the Trump administration officials who “lawyered up” as soon as Special Counsel Robert Mueller was named.  If a potential target of an investigation waits to retain counsel until charges are filed, she may have delayed too long to do herself any good.

We do wonder, however, about the propriety of paying legal defense costs from a campaign account.

The Government Code allows a local candidate or officeholder to set up a separate bank account to cover the costs, including attorney’s fees, of defending herself in a civil, criminal, or administrative proceeding “arising directly out of . . . the performance of the officer’s governmental activities and duties.”  The account is subject to its own record-keeping and reporting requirements, and the funds may be used only for legal expenses.  At least so far, neither Ms. Vella nor Mr. Oddie has chosen to take this route.  Instead, they’re paying their legal defense costs out of their regular campaign accounts.

Here, the law is somewhat murky.  The Government Code requires that any expenditure of campaign funds that “confer[s] a substantial personal benefit” must be “directly related to a political, legislative, or governmental purpose.”  The Code then provides that spending campaign funds for attorney’s fees “in connection with administrative, civil, or criminal litigation” is not permitted except in specified circumstances, one of which is that the litigation “arises directly out of . . . a candidate’s or elected officer’s activities, duties, or status as a candidate or elected officer, including, but not limited to, an action to enjoin defamation, defense of an action to enjoin defamation, defense of an action brought for a violation of state or local campaign, disclosure, or election.”

There are no published appellate opinions interpreting this provision, and the informal guidance provided by the Fair Political Practices Commission offers no definitive answer about whether the investigation into Ms. Vella’s and Mr. Oddie’s alleged misconduct can be considered to “arise[] directly out of” their “activities, duties, or status” as Council members, thereby allowing them to spend campaign funds to defend themselves.

On the one hand, the FPPC’s manual for local candidates lists seven examples of situations in which campaign funds may be used to pay attorneys’ fees, none of which is remotely similar to this one.  On the other, back in 1996, the Commission’s general counsel issued an “advice letter” permitting a county supervisor to spend campaign funds to defend herself against a formal accusation of misconduct issued by the civil grand jury.  In that case, the alleged wrongdoing consisted of using county support staff,  equipment and supplies for campaign purposes, not of interfering with a city manager’s performance of her official duties.

We can only assume that the extremely competent lawyers hired by the two Council members have blessed the legality of paying defense costs from campaign accounts.  And as long as Ms. Vella and Mr. Oddie are able to rely on their union and party friends to give them the cash they need to cover their legal bills, they’re not costing the City any money.  We will say this, however:  Should the Coblentz and Keker firms manage to ward off any further proceedings against their clients, as Mr. Keker did for Ms. Tam, we’ll hold our nose when Ms. Vella and Mr. Oddie claim to have been “exonerated” – but we won’t be amused if they then turn around and ask the City to reimburse the contributors to their de facto legal defense fund so they can stick the money back into the campaign accounts.

Sources:

Campaign disclosure statements may be found online on the City website: http://docs.ci.alameda.ca.us/WebLink8/Browse.aspx?startid=310100&row=1&dbid=0

Government Code: Gov. Code 85304.5; Gov. Code 89510 et seq.

FPPC materials: Manual_2_Ch_5_Use_of_Campaign_Funds; FPPC advice letter (4-25-96)

 

About Robert Sullwold

Partner, Sullwold & Hughes Specializes in investment litigation
This entry was posted in City Hall, Firefighters and tagged , , , , , , , , , , , , , , , , , . Bookmark the permalink.

6 Responses to Thousands for defense. . .

  1. Steve Gerstle says:

    The City is so self absorbed with its own internal mishegas that is cannot even keep the street lights on.
    https://seeclickfix.com/issues/3986012
    Yet, they are thinking of asking us for a $90,000,000 bond measure for infrastructure repairs. Who allowed all the adults to leave the room at the same time? As a friend of mine put it, “The City keeps stepping in sh!t and then tracks it all around.”

  2. Tawney says:

    Thank you

  3. MP says:

    Question for author: What governs reimbursement (by the City) of legal fees incurred in a matter such as this and is it mandatory (where conditions are met, a la Labor Code s 2802) or discretionary on the part of the Council? If discretionary, who votes?

  4. dave says:

    It’s a cost of doing business for the unions. Once the politician is bought, there are ongoing maintenance expenses.

  5. barbara thomas says:

    Guess Vella can vote for the Council to re-imburse Oddie, and Oddie can vote to re-imburse Vella! And Ashcraft can vote to re-imburse both. And Vella and Oddie can both threaten to sue the City if they don’t get re-imbursed. Taxpayers get to pay for the attorneys both investigating and defending these two. No wonder Oddie was awarded the protections of the bankruptcy court for his fiscal prowess. Poor Jill Keimach, she was darned if she didn’t bring their actions up, and now has to pay the price for doing so, literally in terms of the City’s budget. And the unions that have contributed certainly expect payback of some sort, and not necessarily in the best interests of our City.

  6. koolkell says:

    It always amazes me when working class people vote against Labor Unions. Google the history of Trickle Down economics and its consequences.

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