LOS ANGELES (CN) – A California judge ordered Los Angeles on Monday to produce attorney communications regarding a multimillion-dollar class action settlement over utility overcharges, to help determine whether the lawyer who represented the lead plaintiff also coordinated with the city and may have engaged in fraud.
In 2016, Superior Court Judge Elihu Berle approved a class action settlement involving customers of Los Angeles Department of Water and Power (LADWP), who said they were overcharged due to faulty meter readings in a system designed and implemented by consulting firm Pricewaterhouse Coopers.
Los Angeles agreed to pay the $67.5 million settlement and sued Pricewaterhouse over the system, claiming the firm misled the city when it applied for a proposal to update the aging billing system.
In court records, Pricewaterhouse claimed the lead plaintiff in the class action, Antwon Jones, was at one time represented by attorney Paul Paradis who then went on to represent the city of Los Angeles as a special counsel in litigation. The firm called the settlement a fraud, designed by Los Angeles and its legal team to resolve all other ongoing billing litigations under one broad “white knight complaint.”
Earlier this month, the city’s lead civil attorney for LADWP Eskel Solomon said in a deposition there was knowledge about an incoming ratepayer lawsuit before it was filed in 2015. That notification could have come from Paradis, said Solomon.
On Monday, Pricewaterhouse attorney Daniel Thomasch of Gibson Dunn told Judge Berle “the fraud was carried out by attorneys” and the city leveraged Paradis’ relationship with Jones to facilitate the settlement. He said the scheme carried out by the city’s legal team papered over the agreement and never disclosed the relationship to the court.
Attorney Eric George of Brown George Ross, representing the city of Los Angeles, told Berle his law firm has reviewed thousands of documents and has not found anything to show that the city was aware of the scheme carried out by previous counsel.
The city has opposed the production of communications under attorney/client privilege, but Berle said that privilege was waived when Paradis represented both sides of the class action brought by Jones.
Berle said at least nine city employees received drafts of agreements showing the city had secured Paradis and attorney Paul Kiesel around February and March 2015, and those same drafts also showed special counsel represented Jones.
Berle found Pricewaterhouse had done enough to show its claims of fraud have foundation and granted its request for the attorney communications.
In court documents, PricewaterhouseCoopers said it intends to depose City Attorney Mike Feuer on the ratepayer settlement.
The Federal Bureau of Investigations raided LADWP headquarters last month as part of an ongoing investigation into the settlement. The ratepayers, meanwhile, have new attorneys and claim they deserve millions more.
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