Metropolitan News-Enterprise


Wednesday, October 5, 2011


Page 1


C.A. Throws Out City Attorney’s Suit Against Controller as Moot




A lawsuit initiated by former City Attorney Rocky Delgadillo to prevent an audit of his office’s Workers’ Compensation Division by former Controller Laura Chick was rendered moot by the actions of the successor city attorney and controller after they took office in July 2009, the Court of Appeal for this district has ruled.

Div. Eight, in an unpublished decision Monday, noted that current City Attorney Carmen Trutanich invited current Controller Wendy Greuel to conduct a performance review of the workers’ compensation program, which has not been completed, even though Los Angeles Superior Court Judge Mark V. Mooney had found the controller could not audit the office of an elected city official.

The case was tried before Mooney on June 1, 2009, and he issued his statement of decision June 22. After considering lengthy objections by the controller, Mooney issued his statement of decision in Dec. 2009, and entered judgment in favor of the city on Jan. 7, 2010.

On Oct. 12, 2010, the controller released an audit report of the workers’ compensation program, and Trutanich’s office issued a press release the following day which said the city attorney, immediately after taking office, had asked Greuel to initiate “a complete and thorough performance audit of the City Attorney’s Workers’ Compensation Division as it has operated since before July 2009.”

‘Considerable Time’

The release stated that “[t]he City Attorney’s Office personnel assigned to the Workers’ Compensation Division took considerable time over the past 12 months [i.e., October 2009 to October 2010] to discuss the program and provide detailed information to the audit team.”

In her decision for the appellate panel, which took judicial notice of these documents, Justice Elizabeth A. Grimes reasoned the “case was rendered moot before entry of judgment in the trial court.”

The documents, she said, indicate that “the performance audit that gave rise to the appeal was well underway with the full cooperation of the City Attorney three months before the court entered judgment in its January 2010 ruling, and it was completed by October 2010.”

Although the audit report was not released until 10 months after entry of judgment, Grimes said “it was plain by at least October 2009 that City Attorney Trutanich supported the Controller’s audit and was fully cooperating with the auditors.”

Unnecessary Judgment

Grimes concluded the “judgment was unnecessarily rendered below because the parties failed to ask the trial court to dismiss the case as moot” and, joined by Presiding Justice Tricia A. Bigelow and Justice Laurence D. Rubin, directed Mooney to dismiss the underlying case.

She cautioned that this order “does not imply the judgment was erroneous on the merits, as we have not considered the merits,” however, as reversal is “merely the necessary procedural step to properly dispose of this moot case.”

Trutanich, in a statement yesterday, defended his decision not to seek dismissal of the suit—for which he was criticized by Chick, who called him a “demagogue” and “liar” in a 2009 radio interview—since he “refused…to have the taxpayers pay the $200,000 bill for the Controller’s private attorney, who lost the lawsuit.”

He remarked that he had “said from Day One, the Controller was invited in and free to conduct a thorough and honest audit of my Office,” and further asserted that he had “fully cooperated and have implemented more than 90% of the recommendations made in that audit,” contrary to a “score card” issued by Greuel last month.

The six-page report, available on the city controller’s website, tracks the progress of city departments in implementing the recommendations made in the 41 audits her office has completed in the last two years. It indicates that Trutanich’s office has failed to satisfy any of the 66 recommendations Greuel had made, or begin working towards their implementation.

A spokesperson for Trutanich’s office yesterday disputed this report, asserting the City Attorney’s Workers’ Compensation Division has implemented, or is in the process of implementing, 50 of the recommendations. These include “the drafting of a comprehensive Support Staff Manual, implementing a peer review process, preparing detailed case closure reports, increasing staffing and reducing caseload per attorney and training City Personnel Department adjustors and supervisors,” he said.

Full implementation, however, the spokesperson said is “not possible at this time due to severe budget cuts suffered by the City Attorney’s Office in recent fiscal years.”

He claimed Trutanich’s office “has also worked directly with the City Council and implemented several significant cost-saving measures that were not part of the Controller’s recommendations, including 1) increasing the settlement cap from $50,000 to a maximum of 99% of permanent disability (PD) without reference to dollar limit, provided such settlement represents undisputed statutory benefits; and 2) the e-filing of court documents.”

Greuel’s audit indicated that the city attorney’s program was mismanaged, and that the office’s failure to collect from third parties responsible for employee injuries may have cost the city more than $3 million each year. She also said the office took too long to settle cases and diverted attorneys to other projects, weakening its ability to effectively represent the city in workers’ compensation cases.

Yesterday Greuel issued a statement asserting that she “believe[s] in transparency and the right to audit all city programs, departments and offices,” and noting that she has “uncovered more than $100 million in waste fraud and abuse” during her tenure as controller.

When she took office in 2009, she said she “immediately asked the City Attorney to dismiss the case because I believed I had the right to audit any city program, no matter where it was housed, and this case was a waste of money and time and should not go forward.”

Monday’s decision “confirmed my initial position that the lawsuit should have been dismissed before the trial court entered its final judgment by reversing the trial court’s judgment as moot,” and “allows the Controller’s office to continue to root out waste fraud and abuse in connection with any program in the City of Los Angeles,” Greuel said.

Greuel is a candidate in the 2013 mayoral race......, while Trutanich is running what he is calling an exploratory effort to become district attorney next year.

The case is City of Los Angeles v. Greuel, B221912.


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