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Central Basin GM Kevin Hunt and
law firm in charge of choosing the ethics counsel had “no idea” about the law firm’s transgressions.
By Brian Hews
In May 2015, Hews Media Group-Community News exclusively reported that the Water Replenishment District (WRD), based out of Lakewood, California, paid nearly $10 million in legal fees since 2012, with one of the biggest recipients, Los Angeles based Harris & Associates and its principal owner, John W. Harris (Harris), billing the water agency nearly $2 million in less than two years.
It was reported that Harris billed WRD over $700,000 – $87,000 per month – in an eight-month span.
Inside sources also told HMG-CN that Harris was “cut off” in late April 2014, subsequently engaged in dispute negotiations, and came under an “independent investigation” related to the massive legal fees.
Many in the water industry knew about the investigation at the time.
But that May 2015 HMG-CN article apparently did not cause concern at Central Basin Municipal Water District (CB).
During tomorrow’s (Jan. 15) “special meeting,” the CB Board will consider Harris as the District’s Special Counsel to Conduct Ethics Investigations, even though the dark cloud of overbilling WRD hangs over Harris’ head.
More egregious, the hiring will basically give Harris a blank check to conduct investigations because the CB Board “cannot tamper” with any ethics investigation.
Long time water veteran, CB GM Kevin Hunt, who surprisingly did not know about Harris’ over billings at WRD, told HMG-CN, “we were out of loop on this, the firms were selected by (CB’s law firm) Nossaman, based on the criteria we gave them.
The Nossaman attorney in charge of vetting the law firms, Alfred E. Smith II, told HMG-CN in a phone interview, “I had no prior knowledge of the circumstances surrounding Mr. Harris, but thank you for letting me know.”
The dispute negotiations with Harris started in late 2014 when the WRD Board, led by President Sergio Calderon, Director Rob Katherman, and Director Albert “Lil Al” Robles, hired Los Angeles based Sheppard, Mullin, Richter & Hampton (Sheppard) as “independent counsel” to investigate the alleged overfilling by Harris.
No one at WRD questioned the fact that Sheppard was also involved with WRD on other water-related legal matters and that a true independent counsel was not hired.
But the apparent conflict of interest, even though questionable, would not be a factor in the investigation.
HMG-CN has exclusively obtained a document submitted by attorney Adam Kargman in April 2014 from former WRD Board member Lynn Dymally outlining the Harris overfilling in great detail.
Most of the overbilling was related to the Cerritos v. WRD lawsuit, L.A. Superior Court case number BS128136.
The document was addressed to WRD Directors, General Manager Robb Whitaker, and WRD Chief Financial Officer Scot Ota.
Kargman did not mince words. The second paragraph of the letter stated, “I wish to advise you that on April 24, 2014, I first began to suspect – and later confirmed the next day, April 25 – that Harris & Associates has been engaged in improper and excessive billing of WRD for its legal services.”
Bargeman said that in April 2014, principal of the Harris law firm John W. Harris asked him to review billings of the firm’s invoices to WRD and “it was then that I noticed discrepancies in his (Kargman’s) time entries and also excessive time entries for Mr. Harris.”
As proof, Kargman stated, “I have retained all of my time entries since January 2014 and then compared my actual time entries to the time listed on the invoices sent in by Harris & Associates to WRD, there are numerous discrepancies.”
Based on his review of time attributed solely to his work in January 2014, Kargman identified at least 51 fabricated entries and approximately 51.9 hours of padded time.
“At $275 per hour Harris improperly billed WRD for at least $14,000 worth of time attributed to me for the month of January 2014.”
Harris Padding His Own Time
Kargman then indicated that he also believed that invoices to WRD included time entries that Harris did not actually perform.
At the time, Harris was paid $300 per hour.
“I drafted the majority of the documents. I would send my work to Mr. Harris for approval and he typically only gave minor comments. Often his response was simply ‘Approved.’ Nonetheless the invoices indicated that Mr. Harris, who is frequently out of the office, billed as much or more time on the exact same tasks as I had performed in full.”
Kargman cited two instances indicating “these are just a few of the many examples of improper billing I have uncovered.”
On one invoice, Harris claimed he spent seven hours reviewing a document sent to him by Kargman.
Kargman said, “I sent the document to him at 10:41 a.m., Mr. Harris sent it back to me at 2:33 p.m. a time span of only four hours, yet Harris billed WRD seven hours.”
Another invoice indicated Harris spent four hours reviewing a document sent to him by Kargman.
“I sent Harris the document at 5:17 and received the document back six minutes later at 5:23, yet Harris billed four hours.”
A former WRD top employee familiar with John Harris’ work at WRD recalls it as “sloppy and a gross abuse of District funds.” “We were all aware that H&A were grossly over billing but at the same time aware that these guys were Albert Robles’ people, just like 80% of the agency’s vendors. We all witnessed the General Manager come unglued by the inept work product provided by Harris, but in front of Robles he praised the guy and acted like he didn’t have a care in the world. Quite frankly, it was humiliating to see how Albert Robles intimidated everybody on staff and those who didn’t bow to him were targeted for termination. About half the staff remains at WRD that were employed there only 5 years ago. Either they grow disgusted by the thievery of the John Harris’ of the world or they made the mistake of disagreeing to Albert Robles.”
At the CB Special Meeting on Jan. 15, CB GM Kevin Hunt indicated that all law firms will be interviewed, “and we will certainly bring up what HMG-CN found in the interview process.”
Nossaman attorney Smith II indicated that the HMG-CN revelation “will be brought to everyone’s attention at the meeting.”
HMG-CN left a message at Harris’ office; Mr. Harris had not returned the call by press time.
HMG-CN also left a message with Adam Kargman’s attorney Richard Drooyan; Drooyan had not returned the call by press time.
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