Metropolitan News-Enterprise


Thursday, December 16, 2010


Page 11



Petchner Exonerated in Graft Probe but Mayor Draws Heat, Resigns




William C. Petchner was the first witness called before the Los Angeles County Grand Jury as it launched its investigation on Oct. 19, 1908, of vice in Los Angeles—vice that was purportedly rampant, and sanctioned by the administration of Mayor Arthur C. Harper.

Petchner was secretary of the Pacific Sugar Corporation and its attorney. Harper was a vice president. He and his cronies, including police commissioners, were investors in the corporation and, according to allegations in the Express and the Herald, strong-armed liquor dealers and saloon-keepers into pumping capital into the enterprise by buying its stock—in return for which, violations of liquor laws were overlooked.

Other allegations had surfaced of graft and of condonation of prostitution. In fact, the mayor and police chief were said to be regular patrons of houses of ill repute.

The watchdog panel’s Feb. 10, 1909, report announces:

“We have returned no indictment. From which it can fairly be concluded that we have failed to find evidence that any public official or other has been guilty of a felony. We have failed to find evidence of so-called ‘grafting’ among the city officials of Los Angeles.”

With respect to the Pacific Sugar Corporation and its allied entities, the report says:

“We found that the sugar companies in which the Mayor was interested were ordinary business ventures in which there were associated with him many of those who would naturally be associated with a man in business—his friends and associates.”

Petchner and the corporation were thus exonerated of wrongdoing. Harper, on the other hand, though not indicted, was far from absolved of wrongdoing.

The report says that while houses of prostitution were declared illegal in California in 1872, the city had nonetheless impermissibly established “red-light districts” in which they were tolerated. It declares:

“We find the Mayor and some members of the Police Commission, have made frequent visits to houses of prostitution throughout the city inspecting their condition (and on one occasion which appears to the grand jury to have been more in the nature of an orgy than an inspection) we find that such action on the part of the Mayor and Police Commission is reprehensible and outside of their official jurisdiction….”

(The grand jury declined to seek the ouster of police officers who had refused to enforce the misdemeanor statute against prostitution because, during pendency of the three-month grand jury probe, the 100-or-so whorehouses in the city had been shuttered.)

The decision of the grand jury not to indict Harper did not douse the fires. A recall election qualified for the ballot, and was slated for March 26, 1909. That election was held, notwithstanding that Harper resigned on March 11. He apparently was prompted to do so by a blackmail threat uttered by the publisher of the Express, Edwin T. Earl, who seemingly had proof of Harper’s protection of vice.

As related in my series on past DAs of Los Angeles County, Thomas Lee Woolwine, the successful 1910 Democratic challenger to Republican DA John D. Fredericks, in his opening campaign address assailed the incumbent for having “stifled” the 1908 grand jury investigation of Harper and others in connection with the allegations of graft.

Woolwine, working with Earl, had initially raised the allegation in 1908, while Los Angeles city attorney, that Harper was on the take.

Various civil actions were brought against Pacific Sugar Corporation, as well as against its principals, including Petchner, who had guaranteed its notes.

Nathan Cole Jr., co-founder of the Los Angeles Times, was a vice president of the corporation and its general manager. He went into bankruptcy on March 30, 1910.

The June 23, 1910, issue of the Herald reports:

“Samuel Schenck, a former police commissioner of this city, who figured quite prominently in the political limelight during Mayor Harper’s regime, filed a voluntary petition in bankruptcy yesterday with the clerk of the United States district court, listing his liabilities at $184,727.84 and his assets at $230.

“Schenck was forced to petition to be adjudged a bankrupt through the failure of the Pacific Sugar corporation, he having been one of the principal stockholders. The sugar firm went into debt in the sum of $872,368.78 [about $20.3 million in today’s dollars], and as Schenck owned one-twelfth of the stock he was held responsible for one-twelfth of the debts....”

Long Beach property on Ocean Avenue, belonging to one Al D. Myers, was sold at a sheriff’s sale on Dec. 8, 1910, to satisfy a $12,693.03 judgment in favor of Union Bank against the corporation. (The sum is roughly equivalent to $296,000 now.)

Petchner returned to Los Angeles from Corcoran, where the company had a plant, and resumed his private law practice.

The Oct 23, 1927, issue of the Los Angeles Times shows that he was president of the Angeles Forest Highway Assn. which was advocating construction of a highway from Pasadena to the Antelope Valley.

He died in 1938.


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