July 7, 2005
THE NEWS | STAGE DOOR | PREVIEW | THE
HUM | CALENDAR
Case dismissed: The unraveling
of People v. Pacific Lumber and People v. Debi August
SITTING IN HIS OFFICE ON THE
FOURTH floor of the county courthouse last week, District Attorney
Paul Gallegos marveled at the venom of his enemies. Earlier in
the month, both the DA's fraud lawsuit against Pacific Lumber
and the grand jury's conflict of interest case against Fortuna
City Councilmember Debi August had been thrown out of court.
His detractors were exultant -- the DA had finally got his comeuppance
for hotly pursuing two cases they believed to be rooted more
in politics than the law.
"We file tough cases sometimes,"
Gallegos said in answer to their charges. "That's our obligation.
If I said I wasn't going to file a case because it may be tough,
or I may lose, I'd be doing an injustice to this community."
There are no regular, scientific
opinion polls to gauge the mood of the local electorate, but
it would be a fair guess that Gallegos' hypothetical approval
rating probably dropped in June, perhaps substantially. Two developments
in the last two weeks -- Deputy DA Worth Dikeman's entry into
next year's election and a sharply critical assessment of the
office from the Humboldt County grand jury -- certainly couldn't
have helped him. But the biggest blow to his image was likely
the defeats handed to him in the two highest-profile cases his
office has prosecuted. Both cases were dismissed before they
went to trial, though for very different reasons.
Maybe it was unfair that the
two cases consumed so much ink, and so much public attention,
when the office continued to prosecute murderers and other violent
criminals. But from Gallegos' first days in office, after he
filed the Pacific Lumber lawsuit, the public has come to think
of him in terms of his sweeping, politically charged cases. Last
year's attempt to recall him only cemented this picture. To supporters,
Gallegos has been a crusading advocate for the people, dispensing
justice even-handedly and cleaning the Augean stables of the
local good-old-boy system. To detractors, he's been a showboater,
filing dubious legal actions in order to stoke the passions of
the environmental community, his political base.
These perceptions will be slow
to fade, especially if Gallegos decides to pursue an appeal in
the Pacific Lumber case. But the events of the last month feel
like the turning of a page. Deputy District Attorney Tim Stoen,
the prosecutor whom Gallegos brought with him to office and who
led the prosecution in both the Palco and August cases, last
week announced that he will be leaving the office effective next
Friday to return to a job under Mendocino County DA Norm Vroman
(see "Weekly Wrap"). Despite
his protestations, and perhaps partly due to circumstances beyond
his control, without the Pacific Lumber case Gallegos seems incomplete.
In the coming year, in the long lead-up to what is sure to be
another bitterly fought, politically divisive election, he may
have to campaign as any of the state's 57 other district attorneys
do -- less as a sword of righteousness, more as an effective
In any case, he is unrepentant.
"Believe me, when you run
for office, you realize you will be judged," he said. "If
people think I've done wrong, they're going to toss me. That's
the way it works."
People v. Pacific
THE PACIFIC LUMBER FRAUD SUIT
WAS FIRST FILED shortly after Gallegos took office. It relied
on information provided to the office by Ken Miller of the Humboldt
Watershed Council, who had unearthed an irregularity in the 1999
Headwaters deal between Pacific Lumber and the state and federal
governments. In negotiations over the company's future logging
plans, the company submitted preliminary data that called into
question conventional wisdom on the relationship between logging
and landslides. The data seemed to suggest that the company could
log more, without severely affecting ground stability. Palco
then lobbied regulators to allow a greater yearly harvest.
But later, the company submitted the final version
of that data, which apparently ended up contradicting the initial
study and was much more in line with what geologists had assumed
to be the usual effect of harvesting. The final data was submitted
to regional offices of the California Department of Forestry
and the North Coast Regional Water Quality Control Board rather
than to CDF headquarters, where it should have gone. The revised
information never made it to the desk of Richard Wilson, then
the director of the CDF; Wilson later testified that if it had,
he would have waited for additional public comment before approving
the final Palco harvest schedule.
On July 14, after pondering
the case for many months, Judge Richard L. Freeborn -- a visiting
judge from Lake County -- agreed with the company's argument
that the DA's lawsuit had no legal merit. Freeborn presented
several justifications for the decision in his opinion, but primarily
he agreed with Palco's contention that a legal theory known as
the Noerr-Pennington doctrine -- which Stoen dubbed the "right-to-lie"
defense -- protected the company, as it was at the time exercising
its First Amendment right to petition (or "lobby")
One apparent conclusion that
can be drawn from the ruling is that Stoen made a huge tactical
blunder last year when he undertook a months-long fight to get
Judge Christopher Wilson, a member of the Humboldt County bench,
removed from the case.
In arguments before an outside
judge and a California appellate court, Stoen argued that Wilson
had at least the "appearance" of prejudice against
him and the case. Stoen cited the fact that Wilson had a "personal
relationship" with a relative of Humboldt County Supervisor
Bonnie Neely, who he said is a staunch timber supporter, and
argued that apparently jocular comments Wilson directed at Stoen
during another controversial case -- to the effect that Stoen
was "trying to get me to lose my job" -- demonstrated
bias. The appellate court ruled against Stoen, but Wilson voluntarily
bowed out anyway, handing the case to Freeborn.
Exactly why Stoen
was so opposed to Wilson hearing the case -- and why he was willing
to risk the approbation of the court and the wider legal community
to get the judge removed -- remains something of a mystery. True,
in an earlier ruling Wilson had written that the California Unfair
Competition Law was an "ill-suited vehicle" for the
charges, and added that Stoen would likely have had a difficult
time proving the facts of the case at trial.
[Photo at right:
Nevertheless, in the same ruling
Wilson unequivocally stated that according to his reading, the
company was not protected by Noerr-Pennington: "[T]he immunity
afforded by the Noerr-Pennington Doctrine does not apply in this
case," he wrote. If Stoen had stuck with Wilson, the case
would almost certainly have gone to trial.
Asked to comment on this aspect
of the case's history last week, Gallegos said only that he didn't
dwell on the past. Stoen likewise declined comment. But both
said that they believed that Freeborn's ruling is ripe for appeal.
Gallegos said that he believes
the ruling is plainly erroneous, and he offered a reductio
ad absurdum argument to explain his reasoning. Apply it to
someone seeking a building permit from city government, he said;
according to Freeborn, the applicant can lie and swindle the
building department with impunity, as the First Amendment offers
them complete immunity in their "lobbying" of regulators.
"This interpretation, taken to its extreme,
is that every interaction with government is quasi-judicial,
and therefore `lobbying,'" he said. "So there's no
obligation to be truthful."
But his conviction that the
ruling is mistaken does not necessarily mean that he will appeal
the decision. Gallegos said that the decision on an appeal will
largely be made in consultation with his fellow district attorneys,
and will likely hinge on whether they want to run the risk of
having Freeborn's ruling confirmed at the appellate level --
where it would become binding on everyone.
"Right now you have a ruling
that's pretty perverse, or odd," he said. "But it's
not a published decision. The question is, do you want a decision
like that to be published law? I think all the DAs in the state
of California do not want that to be a published decision."
[Photo at left:
Then again, he said, it could
be that his colleagues would want to see the ruling challenged.
Since the passage of Proposition 64 last fall, district attorneys
and the state attorney general are the only people who may bring
a suit under the California Unfair Competition Law. If Freeborn
were overturned at the appellate level, their powers to bring
suit would be more clearly defined.
Stoen, for one, believes that
it's worth the risk.
"This case is ready-made,"
he said. "It's juicy, it's ready to show that the Noerr-Pennington
doctrine does not allow lies in the seeking of a permit. If Paul
decides to appeal, we can set a statewide standard that every
person and every corporation will have to follow."
IT WAS PERHAPS A FITTING ENDING
TO A CASE that was never far from threatening to devolve from
a legal proceeding into a soap opera, or a Shakespearean tragicomedy.
Just as jurors were being chosen for the
August trial, Judith Schmidt, the foreperson of the grand jury
that investigated and accused August of malfeasance in office,
stepped forward with a sheaf of internal grand jury e-mails and
other documents that she had squirreled away in her own home
office -- fearing, she said, that the day would come in which
they would be needed. And they were: Among the Schmidt documents
were some that the current grand jury had not provided to August's
defense team, despite a court order.
Jury selection was halted while
Stoen and August's attorneys, Greg Rael and William Bragg, questioned
Schmidt. Then, in response to a motion from the defense, Judge
John Feeney threw the case out, ruling that August's rights to
due process of law, and the court's own ability to make fair
judgments in earlier rulings, had been irretrievably harmed by
the fact that the grand jury's official records in the case had
apparently been culled.
Gallegos, for one, said last
week that he was not sorry to see the case end.
"Frankly, that's a case
I would rather not have had, every step of the way," he
said. "You know there's going to be a hue and a cry, and
there was a hue and a cry."
Feeney's dismissal meant that
the charges against August leveled in May 2004 by the grand jury,
with Stoen acting as its legal counsel, would never be heard.
Likewise, the dual mysteries of how the case came to be and how
the Schmidt documents came to be missing from the grand jury's
files will probably remain mysteries for some time.
In 2003, the grand jury received
a complaint from a Fortuna resident, saying that August was acting
inappropriately in regards to a proposed subdivision that was
working its way through city government. A real estate broker
by trade, she had signed on as "agent" for the project,
working with city staff and appearing before the city's planning
commission on its behalf. (Though she had initially said that
she would "probably" end up selling the resulting lots
through her office, she later reversed herself, saying that she
would disclaim any financial interest).
After investigating on its own
for a few months, the grand jury called in the DA's office to
ask about potential legal proceedings that could be brought against
August. In addition to the alleged conflict of interest, the
grand jury had turned up financial disclosure forms that August
had mistakenly filled out when she was a planning commissioner.
The grand jury interviewed several other witnesses with Stoen
present, then, following his advice, initiated a rare legal proceeding
known as an "accusation," which sought to remove August
For several months, the case
took several odd turns -- at one point, last August, it was mistakenly
thrown out after some paperwork went missing. Taking offense
at Stoen's characterization of this premature dismissal as a
"major error," Judge J. Michael Brown recused himself
from the case, saying he would be unable to remain impartial
so long as Stoen was the attorney.
The case -- which Feeney had
pruned of everything except the key conflict-of-interest charge
-- was set to go to trial when Schmidt stepped forward.
One thing became clear in the
aftermath of Schmidt's testimony: There was a deep sense of mistrust
between the grand jury and the DA's office, centered mostly on
the conflict between August's right to confront her accusers
and the grand jury's traditional promise of secrecy to the people
who testify before it. Schmidt told the court that the current
grand jury foreperson, Darlene Marlow, had ordered her to destroy
the documents in her possession. Reportedly, Marlow and other
grand jury members were upset that documents had been delivered
to August's attorneys, and entered into the public court file.
According to Stoen, this was
a result of the grand jury going off half-cocked, initiating
an investigation on their own and promising confidentiality to
witnesses -- seemingly unaware, all the while, that records of
interviews would have to be turned over to the defense if charges
"If they had come to us,
we would have said don't do that. Let our investigators do that,"
Gallegos said that the spat between members
of the grand jury and his office was largely responsible for
the condemnatory report on his office filed by the grand jury
"Darlene Marlow -- she's
been upset at us for two years now," he said. "There
were disagreements on how the August case was handled, over our
obligations. Was our obligation to them, to protect their privacy
rights, or was it to Debi August, to protect her due process
rights? I know where I would fall every day. Debi August is the
August attorney Greg Rael said
that he was preparing to ask Schmidt what had prompted her to
retain documents, contrary to grand jury policy, when Feeney
decided to dismiss the case. Her answer may have shed some light
on how the documents came to be missing from the grand jury file,
he said. [Photo at left:
In any case, Rael is certain
that if the case had gone to trial August would have been vindicated.
He said that the case law on grand jury accusations, as represented
by the 1996 case Steiner v. Superior Court, mandated that
such actions must be reserved for truly serious cases of political
misconduct. As such, he said, he took lightly claims by Gallegos
and Stoen that they were happy to sacrifice the case if August's
due process rights had been violated.
"If the DA's office were
truly interested in protecting Debi August's rights in this case,
then they would have correctly interpreted the leading case on
this issue," Rael said.
SEE ALSO: COVER
STORY: "The Debi August File" - Sept. 9, 2004
THE NEWS | STAGE DOOR | PREVIEW | THE
HUM | CALENDAR
Comments? Write a
© Copyright 2005, North Coast Journal,