Pasadena Sued for Embezzlement Scandal

City Manager Michael Beck from a recent council meeting – Photo by Terry Miller

During the public comment section of the Tuesday night City Council meeting James Lomako and his attorney, Philip E. Koebel, filed a class action complaint against the City of Pasadena, City Clerk Mark Jomsky, City Manager Michael Beck, City Attorney Michele Bagneris, as well as Councilmembers Margaret McAustin of Pasadena’s 2nd District, Gene Masuda of Pasadena’s 4th district and Steve Madison of Pasadena’s 6th district.
The lawsuit was filed on the 20th of this month on the grounds that the above mentioned city officials knew of the embezzlement of $6.5 million dollars by Danny Ray Wooten “as early as May 28, 2014, and possibly before and certainly as of November 11, 2014 and they acted together to keep the public uninformed until December 30, 2014.”
The document states that Mr. Lomako and his legal counsel Koebel believe that in late May 2014 or in early June 2014, Defendant (City Manager) Michael Beck and/or defendant (City Attorney) Michele Bagneris voluntarily issued a “gag order” regarding the DA’s investigation and the KPMG Audit to all City department heads and to the Mayor and the City Councilmembers.
The lawsuit also claims that the Defendants “acting under color of law have violated and will violate [28 U.S.C. §§ 1331(a), 1343(3), 1343(4),] 42 U.S.C. § 1983, 1988 [and the First, Fifth and Fourteenth Amendment of the United States Constitution,]” given that, inherent within all American Citizen’s First Amendment Right to petition the government for redress and grievances, “There is no meaning to a right to petition the government where the government willfully shields the public from viewing information that may not give rise to grievances.”
In addition, Mr. Lomako and Koebel believe that this “gag order” would have effectively and deliberately concealed KPMG’s audit from the public from when it was completed on the 11th of November to when the scandal finally broke on the 30th of December, last year.
The reason that the November 11th date is important is because that date lies just before the November 17, 2014 – December 12, 2014 window in which nominations for the quadrennial municipal elections are made.
The complaint filed by Mr. Lomako and his attorney points out that because the public wasn’t informed of the scandal before the cut off for these elections, Councilmembers Masuda, McAustin, and Madison were able to run unopposed for reelection to the City Council.
“The practical impact of the disclosure delay is that the public was kept unaware of vital public information during the nominations period. By the time it was disclosed to the public, the nominations period was closed …” Section 2.8 of the lawsuit states.
Mr. Lomako’s suit then claims that after hearing this information about the time it took for information about the embezzlement to be released, it was already too late to submit an application to run in his district (2) against incumbent Margaret McAustin.
“[Mr. Lomako], a prior candidate for the District Two Councilmember, alleges that he would have timely filed nomination papers if he had been timely informed of the embezzlement. [Mr. Lomako] is a registered voter with a long-time demonstrated commitment to civic engagement in the city. In 2007, [Mr. Lomako] received 39.1% of the cast votes in the election for District Two Councilmember,” the lawsuit notes.
The document then explains that Mr. Lomako received 29 signatures of registered voters in District Two and took these signatures to City Clerk Mark Jomsky in hopes of jumping into the race against McAustin, but was denied.
In an interview with Mr. Lomako outside the council chamber, he explained that what he hopes to gain from the lawsuit is for the city to cancel the current election and form a special election in which the three councilmembers who ran unopposed but with full knowledge of the scandal could be fought against by political opponents on the grounds and that the current election is an illegal expenditure or waste of taxpayer dollars [Cal. Code Civ. Pro. § 526a].
“It is a disregard for the public’s perception. Not even the public’s input, but the public’s perception as to what’s going on, “ said Koebel, “fundamentally the lawsuit is that Jim Lomako says, ‘It is not sufficient to keep me in the dark for two-hundred and fifteen days—from May 28th until December 30th—because you’re trying to arrest some guy. You don’t get to keep me in the dark for over six and a half million dollars of my money—our money—taxpayer money, because you need to make your case against a guy.’ Anybody reading the audit on November 11th, would’ve been able to slap together a [criminal] complaint by November 12th. Anybody would have done it. A fifth grader would have.’’
Mr. Lomako hopes that the lawsuit will get taxpayers interested in participating in local government again, like they did back in 1994 when citizens worked together to defeat a lawsuit by a real estate firm seeking increased mansionization by forming a General Plan that gave birth to “The Gold Line, the redevelopment only in certain commercial corridors; the Pasadena you see today.”
The Independent would like to remind readers that Pasadena City Council Meetings take place on the 1st, 2nd, and 4th Monday of every month, 6:30 p.m., in the City Council Chambers at City Hall.

More from Featured