C.A. Issues Writ in DWP Case Ordering Action Already Taken

Tuesday, August 20, 2019

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C.A. Issues Writ in DWP Case Ordering Action Already Taken

Paradis—Who Represented Class in Action Against City While Also Acting for City—Was Given Second Chance to Show That Correspondence With Ex-Client Is Subject to Work Product Rule

By a MetNews Staff Writer

The Court of Appeal for this district has issued a writ directing the Los Angeles Superior Court to provide lawyer Paul O. Paradis a second chance to provide substantiation that production of documents relating to his representation in a class action against the City of Los Angeles would violate the work product doctrine—but that opportunity had already been afforded.

A hearing is scheduled for tomorrow before Superior Court Judge Elihu M. Berle on the sufficiency of the New York lawyer’s beefed-up privilege log.

Paradis, through counsel, filed a writ petition in the Court of Appeal on July 3. Div. Five on July 8 stayed execution of Berle’s order that documents be provided in discovery.

Communication Lacking

Communication failed after Div. Five on July 22 announced it was considering issuance of a peremptory writ in the first instance, telling the Superior Court that it could “avoid the issuance of a peremptory writ by vacating the June 24, 2019 order denying” a protective order sought by Paradis and his firm, adding:

“If you elect to do so, you are directed to transmit to this court a copy of the order reflecting your action on or before August 2, 2019.”

The Superior Court did not transmit the July 25 order by Berle permitting the filing of a supplemental privilege log. Div. Five on Friday ordered issuance of a writ directing that Paradis be allowed to file what he had already filed on Aug. 2.

Justice Carl H. Moor said in his opinion that Berle had correctly determined that Paradis’s privilege log was too scant to establish a privilege but said that the judge abused his discretion in failing to give Paradis an opportunity to to back and do it right.

The Superior Court’s court counsel, Leah C. Gershon, in a letter yesterday to Div. Five, told of Berle’s July 25 action and advised:

“The trial court had directed Plaintiffs’ counsel to provide notice to the Court of Appeal of the trial court’s compliance with July 22, 2019 order, which appears not to have occurred.”

Beleaguered Lawyers

Paradis, along with former Los Angeles County Bar Association President Paul Kiesel, is enmeshed in controversy over an alleged conflict of interest in representing Antwon Jones, lead plaintiff in a class action against the City of Los Angeles based on massive overbilling in 2013 by the Los Angeles Department of Water and Power (“DWP”), while, at the same time, working for the city. The class action resulted in a $67 million settlement in 2017.

Months before that action was brought on April 1, 2015, the city had secured the services of Paradis to represent it in a lawsuit against PricewaterhouseCoopers (“PwC”), which had implemented the billing system.

The complaint, alleging fraudulent inducement and breach of contract, was signed by Kiesel, of Beverly Hills, and, as “special counsel,” Paradis and a member of his New York firm (who each noted “pro hec vice pending”).

Lawyers Exit Case

Paradis and Kiesel stepped out of the litigation against PwC last March after the defendant raised the issue of the conflict of interest and as the heat was turned up through widespread news coverage. Under the arrangement that had been in effect, they would have received 20 percent of any recovery from PwC.

Jones has agreed, in the present case, to waive his attorney-client privilege but Berle gave Paradis an opportunity to look over the documents in question and seek to block their disclosure on a work-product ground. While the attorney-client privilege is uniformly held to be vested in the client, California differs with some other jurisdictions by viewing the work product privilege as belonging to the attorney.

Berle subsequently denied Paradis’s ex parte application for a protective order—the order which the Court of Appeal on Friday countermanded.

Moor’s opinion directs the Superior Court to “enter a new and different order directing Paradis to file a more detailed privilege log, or if necessary, review the disputed documents in camera to determine the applicability of the attorney work product privilege.” The opinion was declared to be effective immediately.

Trial Court’s Obligation

Moor wrote:

“In this writ proceeding, we are presented with a narrow question of law concerning the attorney work product privilege as codified in Code of Civil Procedure section 2018.030. Specifically, we consider whether former counsel waived an objection to the production of certain documents based on the attorney work product privilege by failing to provide, by declaration or other admissible evidence, sufficient grounds to establish the privilege. We conclude that, under the particular circumstances of this case, the respondent court was required to afford former counsel an opportunity to provide a more detailed privilege log or other admissible evidence to support the privilege.”

Moor cited a 2015 opinion by Div. Three of the Fourth District Court of Appeal in Catalina Island Yacht Club v. Superior Court. There, Justice Richard M. Aronson said:

“When confronted with a deficient privilege log that fails to provide the necessary information to rule on attorney-client and work product objections, a trial court may order the responding party to provide a further privilege log that includes the necessary information to rule on those objections, but may not order the privileges waived based on deficiencies in the privilege log….”

The case is Paradis v. Superior Court, B298836.

Paradis and Paradis Law Group, PLLC were represented by David C. Scheper, Angela M. Machala, Aaron C. O’Dell, and Jeffrey L. Steinfeld of Scheper Kim & Harris.

Arguing for Jones were Los Angeles County Bar Association Immediate Past President Brian S. Kabateck and Anastasia K. Mazzella of Kabateck LLP, along with Jeffrey Benjamin Isaacs, Paige Shen, and Stacey Zill of Isaacs Friedberg & Labaton LLP.

Gibson Dunn & Crutcher attorneys Daniel J. Thomaschand Lauren J. Elliot of the New York office, Maurice Suh of Los Angeles, and Casey J. McCracken of Orange County acted for PwC and its executive, James Curtin, principal of Utilities & Power Generation.

Kabateck yesterday expressed confidence that “the vast majority, if not all of these records” which Paradis wants withheld “will be made public shortly as the claims of privileged or work product will be overruled.”

Suspicions About Lawyers

Suspicions loom that Kiesel and Paradis participated in engineering the class action against the city, obtaining for rate-payers less restitution than was actually owed. Kabateck—appointed by Berle to represent the class—has alleged that underpayments amount to as much as $80 million.

PwC asserted in a March 1 memorandum of points and authorities:

“In the face of continuous obstruction, it has taken over more than one year of motions by PwC, hearings, and depositions to prove that…representations about the Jones v. PwC complaint in the City’s files were both inaccurate and an attempt to cover up a larger fraud. What has been exposed through discovery is a deceptive scheme of stunning scope in connection with the inception, filing, and settlement of the Jones class action against [DWP]. The scheme had many facets, but at its crux was the undisputed fact that Special Counsel (Paradis Law Group, PLLC and Kiesel Law LLP), with the City’s knowledge and assent, concurrently represented the adverse parties Antwon Jones and [DWP]—a position that enabled the development of a collusive lawsuit filed with the expectation of a friendly settlement.”

FBI Raid

The FBI conducted a raid on July 22 on the offices of Kiesel, City Attorney Michael Feuer—whose department hired Kiesel and Paradis—and the DWP. The Office of California Attorney General is also conducting a criminal probe.

Paradis, who has invoked the Fifth Amendment in connection with allegations of wrongdoing, controlled companies which received $36 million in no-bid Los Angeles city contracts, primarily relating to fixing the billing system. Those contracts have been cancelled, but only after more than $20 million has been paid under them.

Jones has filed a claim against the city, alleging he had assumed Kiesel and Paradis had an undivided loyalty to him and the class in the litigation over refunds, and was kept in the dark as to their dual representation of the city.