Palisades Attorney Wants Community Council to Address DWP Scandal

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Given the indictments and criminal charges circling the Los Angeles Department of Water and Power, at least one resident, David Peterson, has reached out to the Pacific Palisades Community Council, asking them to address the corruption.

“This is unbelievable,” Peterson wrote in a note to PPCC President David Card and Secretary Chris Spitz, explaining that the LADWP ignored the specific warning of the California State Auditor not to implement its new billing system in 2014. The system proved to be a disaster and several class actions were filed against the DWP.

The City Attorney’s Office, with the help of the head of the LADWP, had its own lawyers draft and file a class action against the City itself, hide the fact that the complaint was drafted by the City itself, and then settled the class action (with litigant Antwon Jones) on more favorable terms for the City (not the ratepayers) and the LADWP.

The City filed a $100 million lawsuit against PricewaterhouseCoopers (PwC) for installing the faulty billing system, but attorneys for PwC discovered that the City had drafted a complaint against itself to get less for the ratepayers.

The FBI started an investigation in July 2019, and arrests so far include Paul Paradis (former lawyer in the City Attorney’s Office), former DWP chief executive David Wright (appointed by Mayor Eric Garcetti), David Alexander (former LADWP executive) and Pacific Palisades resident Thom Peters (senior official in the City Attorney’s Office). Peterson was charged on January 10 in Federal Court for aiding and abetting extortion.

The judge overseeing this case in civil court has already fined the City $2.5 million for its misconduct and lying during the discovery process.

The latest revelation is that one of City Attorney Mike Feuer’s top deputies threatened to fire one of the City’s outside counsels unless he paid off a disgruntled ex-employee who was going to provide PwC’s lawyers with the documents the City had been trying to hide for two years. The City’s outside lawyer paid the ex-employee $800,000 to keep quiet.

In December, the five-member board of LADWP Commissioners told City Attorney Feuer that they wanted an independent counsel, and taxpayers now have to pay the city’s attorneys and outside counsel.

DWP Board Commissioner President Cynthia McClain-Hill said in a statement: “The Board of Commissioners must have complete confidence in the legal advice and recommendations it receives from the lawyers engaged to protect and defend the interests of the LADWP and its customers.”

Peterson explained to the PPCC’s Card and Spitz that even as utility prices for power and water go up, “we have not heard one peep from the Mayor, the City Attorney or from any member of the City Council.”  (Editor’s note: In 2020, the DWP transferred $320 million to the City. The utility holds $1.6 billion in cash reserves.)

An attorney and long-time resident, Peterson is asking the Community Council to put this item on an upcoming agenda. He’s also urging other neighborhood councils to demand that the DWP and the City Attorney’s Office address the overbilling and corruption.

 One mayoral candidate, Mel Wilson, a San Fernando Valley businessman, is urging the public to protest by not paying their bills until the last minute.

“They haven’t been nice to us, so why should we be nice to them? Let them wait,” he said, and also urged an independent investigation of the DWP.

 

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