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Billing case lawyer denies wrongdoing

By Justin Kloczko | Apr. 30, 2019
News

Civil Litigation,
Government,
Ethics/Professional Responsibility

Apr. 30, 2019

Billing case lawyer denies wrongdoing

The Los Angeles city attorney’s office said it only recently found emails indicating outside counsel defending its interests in a water bill class action drafted the very complaint the city was tasked with defending, but one special counsel said he was only following the city attorney’s office directives.

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Paul R. Kiesel

Paul R. Kiesel, the attorney hired by the city of Los Angeles to handle litigation related to a utility billing issue, said he was following orders from the Los Angeles city attorney's office when he assisted opposing counsel who were drafting a lawsuit against the city.

Kiesel said in an email that his conduct was at the direction of the city attorney's office.

"I have always conducted myself with the highest level of ethics. Neither I nor my firm played any role in drafting the complaint. This was done at the request of the city of Los Angeles," wrote Kiesel.

"The only thing reprehensible is the disingenuous spin coming out of the city attorney's office," Kiesel wrote. "To be clear, I was completely open, direct and candid with everyone at all levels of the city attorney's office," he wrote.

On Friday, the city filed court papers and sent out a statement saying on April 24 it discovered emails indicating outside counsel defending its interests in the water bill class action drafted the very complaint the city was tasked with defending.

The city stressed that no emails have surfaced showing any city employee knew about or directed the drafting of the ratepayer complaint.

However, depositions and court documents appear to indicate the city attorney's office at least knew about ethical breaches involving the case more than four years ago, from the inception of the litigation to settlement concerns expressed in letters to City Attorney Michael N. Feuer.

In response to questions Monday by the Daily Journal about these issues and the origin of the emails, Wilcox said in an email: "We are unaware of anything indicating any city officer or employee was aware of, or directed, the conduct of prior outside counsel reflected in these emails."

City Attorney Michael N. Feuer

Depositions of Kiesel and Deputy City Attorney James P. Clark indicate the city knew that lead plaintiff Antwon Jones was also represented by city special co-counsel Paul Paradis, but did not notify Jones about the adverse representation. Further, no one inside the city attorney's office took issue with Paradis recruiting Jones' counsel, Jack Landskroner of Ohio, an acquaintance who ultimately filed the complaint against the city, according to depositions. Jones v. the city of Los Angeles, BC577267 (L.A. Super. Ct., filed April 1, 2015).

Kiesel said he was never in an attorney-client relationship with Jones, but assisted Paradis' in his representation of Jones in a potential lawsuit against billing software company Pricewaterhouse Coopers LLC. Los Angeles v. Pricewaterhouse Coopers LLP, BC574690 (L.A. Super. Ct., filed March 6, 2015).

Gibson Dunn & Crutcher LLP, who is defending the software company in a pending lawsuit by the city, has alleged in court that once Jones notified Paradis he wanted to sue the city instead of the company, Paradis in his capacity as the city's special counsel sought to maintain control of a captive plaintiff by bringing in Landskroner as favorable opposing counsel. The plan was to quickly settle the case and recoup damages from Pricewaterhouse Coopers, Gibson Dunn alleged.

A settlement overture was made a day after the 2015 complaint was filed, ultimately settling for $67 million with no discovery.

Kiesel echoed similar sentiments about the origin of the lawsuit in his statement responding to the city:

"The city attorney's office was well aware and wanted this lawsuit brought against it so the city could insure a return to rate payers of 100 percent of what was overpaid. That is exactly what the city did," said Kiesel in his statement.

Both Kiesel and Paradis were to be paid almost 20 percent of any damages recovered against Pricewaterhouse Coopers.

The connection with Michael Libman of Tarzana, local counsel for Jones, "who I had met and Mr. Landskroner whom I did not know and had never met was at the express direction of the city attorney's office and its lawyers," Kiesel wrote.

The city said it discovered a trove of 131 records last week, which included emails between opposing counsel organizing the filing of the complaint.

In one email dated almost a month before the Jones class action was filed, Kiesel wrote to Libman: "We are preparing the complaint for your review. Can you send me your State Bar number for inclusion in the draft complaint? I am including Paul Paradis, my co-counsel [sic], who is drafting this complaint."

The header of another email from Paradis to Kiesel dated March 25, 2015, with the subject line Jones v. City of Los Angeles, said:

"The letter that we discussed is attached. If you do not have any edits, please send it to Michael, have him put it on his letterhead and sign it and then send it back to me so that I can send it to Landskroner for his signature. Once it has been signed by both Michael and Jack Landskroner, I will have Jack serve it tomorrow."

A few days later another email shows Kiesel telling opposing counsel Libman he would be "happy" to reimburse the costs of filing the lawsuit.

According to depositions of Kiesel and Clark, Feuer's number two, attorneys for the city knew Paradis represented Jones.

"Did anyone in the city attorney's office consider whether it was ethical for Mr. Paradis to not inform Mr. Jones of the nature of his conflict yet be the person who recommended counsel to Mr. Jones?" asked Daniel J. Thomasch, counsel for Pricewaterhouse Coopers, during Clark's deposition.

"No," testified Clark.

Kiesel during his March deposition said: "The city was aware of Mr. Jones' representation by Mr. Paradis before April 1, 2015. I believe Mr. Clark was aware of it. I believe Mr. [Thomas] Peters was aware of it. I believe the attorneys at the Liner firm were aware of it. Likely the Department of Water and Power counsel were aware of it."

Thomasch went on:

"Did you ever offer any view as to the propriety of having Mr. Paradis recommend counsel to Mr. Jones to bring a lawsuit naming Mr. Paradis' client as the defendant?"

"No," said Kiesel.

San Diego attorney Timothy G. Blood, who filed the first lawsuit over the incorrect bills, wrote to Feuer as early as June 2015 expressing concern about the reverse auction of a class action, in which the weakest in a series of cases is settled.

Since collusion allegations surfaced both Paradis and Kiesel have resigned from representing the city and Feuer has conducted an ethics investigation. Thomas Peters, the head of the city attorney's civil department and a former Kiesel Law LLP partner, also resigned. Landskroner and Paradis pleaded the Fifth Amendment against self-incrimination during their depositions, including when asked about kickbacks.

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Justin Kloczko

Daily Journal Staff Writer
justin_kloczko@dailyjournal.com

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