Colonies Partners files federal lawsuit against San Bernardino County, top state officials over corruption case

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Rancho Cucamonga Developer Jeff Burum

Rancho Cucamonga developer Jeff Burum.

Rancho Cucamonga investor group Colonies Partners LP on Thursday, March 1, filed a federal civil rights lawsuit against San Bernardino County District Attorney Michael A. Ramos and former state Attorneys General Jerry Brown and Kamala Harris, seeking $80 million in damages following a bungled bribery case the developer claims sullied its reputation.

The lawsuit says part of that harm came because prosecutors and investigators in the criminal case ignored or buried evidence that would have cleared the defendants, and that prosecutors “affirmatively fabricated evidence to prop up their case.”

The lawsuit was filed by the investor company, and none of the defendants in the marathon Colonies case are named as plaintiffs.

Those vindicated defendants – developer and Colonies co-managing partner Jeff Burum, former county supervisor Paul Biane, former assistant assessor Jim Erwin, and Mark Kirk, former chief of staff for former county supervisor Gary Ovitt – said they too plan to file similar lawsuits. Each filed claims with the county. Erwin’s and Kirk’s claims were rejected by the county and state. Burum’s and Biane’s are pending.

The county also rejected a Colonies Partners complaint filed in November, which foreshadowed the civil action filed Thursday.

The lawsuit, filed in U.S. District Court in Riverside, alleges the county and state engaged in an “illegal campaign of retaliation, intimidation, and harassment” following a $102 million settlement between the county and Colonies Partners, in Colonies’ favor, in November 2006. The settlement ended a nearly five-year-old lawsuit over flood-control improvements at Colonies’ 434-acre residential and commercial development in Upland, Colonies at San Antonio and Colonies Crossroads.

“The claims and accusations made by the Colonies Partners have no merit,” county spokesman David Wert said in a statement Thursday. “The county and the Flood Control District satisfied their obligations under the 2006 settlement agreement and the county and its officials will vigorously defend themselves against the false claims.”

Attorney Stephen G. Larson, a former federal prosecutor and judge, filed a federal civil rights lawsuit Thursday in U.S. District Court in Riverside on behalf of Rancho Cucamonga investor group Colonies Partners LP, which became embroiled in a far-reaching bribery case that spanned more than eight years and ended in acquittal of its co-managing partner, Jeff Burum, in August 2017.

Also named as defendants in the lawsuit are prosecutor Lewis Cope from the District Attorney’s Office, Melissa Mandel with the Attorney General’s Office in San Diego, former Assistant District Attorney Jim Hackleman, Gary Schons, who for 20 years led the criminal division of the Attorney General’s Office in San Diego, district attorney investigators Hollis “Bud” Randles and Robert Schreiber, county Supervisor Josie Gonzales, former county counsel Ruth Stringer, and former assistant assessor Adam Aleman.

District Attorney spokesman Chris Lee did not respond to repeated requests for comment Thursday. Emails sent to the offices of Gov. Brown, Sen. Harris and Schons also went unreturned. The Attorney General’s Office sent an email saying that it is “reviewing the complaint.”

Colonies Partners, according to the lawsuit, exercised its First Amendment right by contributing $400,000 to “general purpose political action committees (PACs) affiliated with pro-development politicians, including members of the San Bernardino County Board of Supervisors and others who had supported the settlement.”

Prosecutors at the District Attorney’s and state Attorney General’s offices, on the other hand, claimed the PAC contributions were bribes by Burum in exchange for his former co-defendants facilitating the settlement. Yet no juror sitting on Burum’s, Kirk’s and Biane’s jury felt the prosecution proved that during the nine-month-long trial. In August, after less than two days of deliberating, the jury acquitted the three defendants, who maintained from the beginning they were innocent.

The following month, after Erwin’s jury announced it was “hopelessly deadlocked,” Judge Michael A. Smith dismissed the case after the prosecution announced it did not wish to retry Erwin. Cope, the prosecutor, cited “unresolvable witness problems.”

Erwin had a separate jury because some of the evidence against him differed from the other defendants. He said in a telephone interview Thursday he plans to file his lawsuit within the next 30 days.

“It’s nice for a change to have the people who perpetrated this injustice to be labeled defendants,” he said.

The former defendants maintained from the beginning they were innocent and that the case, announced by District Attorney Ramos and then Attorney General Jerry Brown in 2010, was politically motivated. Ramos was seeking re-election that year and Brown was campaigning for governor.

During the heated civil litigation that spanned from March 2002 through November 2006, two Superior Court judges ruled in favor of Colonies Partners, and one of the judges, Christopher Warner, declared in a July 2006 tentative opinion that the county, through fraud and deceit, threatened public safety, and acted in bad faith in its dealings with Burum and Colonies Partners.

The county and its flood-control district claimed it had flood-control easements comprising a 72-acre swath of Colonies property dating back to the 1930s. But the county refused to build a flood-control basin big enough to accommodate a 100-year flood and protect residents at the new Colonies Partners residential development, putting the burden on Colonies Partners to build a 67-acre basin. Colonies Partners maintained it was the county’s responsibility to pay for and build the basin.

Following Warner’s tentative ruling in July 2006, in which he concluded the county had essentially abandoned its easements on Colonies’ property, the county entered into a series of mediation hearings with Colonies Partners and settled the case on Nov. 28, 2006, for $102 million, a record settlement for the county. No county attorney or outside counsel ratified the settlement.

“Despite losing at every turn in the courts, San Bernardino County officials are stubbornly pursuing a path that can only lead to another, years-long legal battle that will only serve to waste millions more in taxpayer dollars while exposing the county to another massive judgment for its wrongdoing,” Colonies attorney Stephen G. Larson said in a statement Thursday. “The county’s unwillingness to end this shameful chapter shows a complete disregard for the taxpayers.”

During trial, prosecutors were slammed with a number of setbacks, including impeached testimony by Supervisor Josie Gonzales and key witness and former Board of Supervisors Chairman Bill Postmus, a recovering methamphetamine addict. Postmus testified he did not feel he was bribed for voting to approve the Colonies settlement, and that he felt pressured by district attorney investigators to provide them information that fit their narrative of the case.

Initially a targeted defendant in the case, Postmus, per an agreement with prosecutors, pleaded guilty in March 2011 to 15 felonies in connection with the Colonies’ case and a companion corruption case in which he was accused of abusing his elected office of assessor for personal and political gain. He is now considering withdrawing that plea, and has yet to be sentenced.

Supervisor Gonzales declined to comment.

Larson described the defendants’ actions in the prosecution as a “relentless drive … to punish Colonies for having exercised its constitutional rights, and to chill Colonies from daring to exercise its constitutional rights in the future.”

According to the lawsuit, the prosecution’s case was “marred by repeated use of fabricated evidence and perjured testimony,” and the case was so weak, Burum did not need to call witnesses on his behalf.

Colonies Partners also alleges the county failed to indemnify the company in the criminal case, per the terms of the 2006 settlement agreement, as that would have “undermined the multi-pronged strategy of retaliation.”

“The county and (flood control) district were undoubtedly thrilled that Colonies was being forced to spend millions of dollars defending itself from the bogus investigation and prosecution, which various county and district employees vigorously encouraged and assisted,” the lawsuit states.

County lawyers, the lawsuit alleges, agreed in 2010 to follow “a dishonest ‘two paths’ strategy,” defending the legality of the settlement in indemnification actions against Upland and other public agencies while simultaneously trying to prove its criminality in the Burum prosecution.

The “two paths” agreement was between then-prosecutor Hackleman and Stringer, who was county counsel at the time, and was discovered by defense attorneys reviewing written correspondence during the criminal prosecution.

“On information and belief, they reasoned that by pursuing both paths, at least one of them would succeed in punishing Colonies,” the lawsuit states.

Stringer did not respond to a request for comment Thursday.

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