3.04.2008

ER - DA petitions Supreme Court

DA petitions Supreme Court

Humboldt County District Attorney Paul Gallegos is asking the California Supreme Court to review his fraud lawsuit against Pacific Lumber Co. that has failed three times to pass legal muster.

Gallegos said this time the influential environmental group Sierra Club is also asking the court to hear the case.

“We’ll see what happens,” Gallegos said in a phone interview Monday.

The district attorney’s case, filed in 2003 in Humboldt County Superior Court, and subsequent amended suits were dismissed on demurrer, which effectively throws out the suit on a lack of legal merit.

After hearing legal arguments from Gallegos and a city of San Francisco attorney on his behalf in December, the California Appellate Court justices blasted his case and concluded in a rare 23-page published ruling and opinion in January that Gallegos failed to prove — on his third attempt — any “reasonable possibility” that his case could be corrected to move forward.

Gallegos confirmed Monday that he has petitioned the state’s top court seeking judicial review of the Appellate Court’s ruling, which he wrote is in “clear error” and effectively denies the government a platform to prosecute cases where the underlying administrative proceedings were corrupt.

In addition to seeking judicial review, Gallegos is asking the Supreme Court to order the depublication of the appeal court’s opinion, which would prevent other courts from citing it as case law.

Gallegos’ suit alleges that PALCO intentionally committed fraud in an effort to increase timber harvesting by manipulating watershed sediment reports during the environmental review that led to the signing of the controversial Headwaters Deal in 1999.

But the courts have maintained that PALCO’s submission of an allegedly erroneous report and the subsequent resubmission of corrected data was protected by the “litigation privilege” that protects communications made as part of a judicial or quasi-judicial proceeding.

Gallegos argues that to grant immunity to an applicant who submits false information erodes the integrity of the system and disempowers the administrative agencies from fulfilling their mandate.

Except in certain death penalty cases, the California Constitution affords no automatic right to appeal before the Supreme Court, which is only granted as a matter of discretion, according to the Supreme Court Web site.

In his letter to the California Supreme Court, Gallegos said the “reasons why courts must shield litigants from derivative litigation are the very same reasons why courts must allow an exception to these evidentiary shields when the path to truth was muddied beyond the point of recourse.”

“In such an instance, a collateral attack under the (Unfair Competition Law) is the only form of equitable relief through which the government can stop an ongoing fraud,” Gallegos wrote.

In a response, PALCO Vice President and General Counsel Frank Bacik described Gallegos’ new filings as “vague assertions that everybody is wrong except Paul Gallegos.”

“The trial court is wrong, the court of appeal is wrong, Palco is wrong,” Bacik said.

Bacik said Gallegos argues that the Supreme Court should carve out an exception to the company’s constitutional right to petition administrative agencies, and also create a special provision for criminal prosecutors who feel like reopening final administrative and environmental review proceedings in order to have the last word on the accuracy and truthfulness of the process.

“His filings contain a series of slogans that lack reason, explanation or basis for either de-publication of the appellate court’s opinion or grant by the Supreme Court for a review of that opinion,” Bacik said.

As an example, Bacik cited Gallegos’ statement to the court that “the clear errors that the trial court committed and the appellate court affirmed obstruct not only the sanctity of 211,000 acres of Humboldt forest timberland, but also the very ‘paths which to lead to [sic] the ascertainment of truth.’”

“Whatever that means, it hardly presents a reasoned legal argument,” Bacik stated. “We’re eager to hear what the California Supreme Court makes of it, and interested to see how long Mr. Gallegos intends to continue beating this long-dead horse at considerable expense to the taxpayers of Humboldt County.”

It is unclear how much the five-year legal battle has cost taxpayers because Gallegos indicated in an e-mail correspondence previously that his office doesn’t keep such records.

“We have an overall budget,” Gallegos wrote. “There are attorney hours, which we don’t keep. I do not believe we had any other costs.”

Gallegos indicated he is still waiting to receive PALCO’s claim of costs, which the court ruled the county would have to pay.

PALCO officials declined to disclose the amount of legal fees it has incurred defending the lawsuit.

By NATHAN RUSHTON, The Eureka Reporter
Published: Mar 3 2008, 10:23 PM