Central  Basin Votes to Finance Former GM Aguilar’s Defense for Whistleblower Lawsuit

Former CB GM Art Aguilar.

Decision paves way for CBMWD to finance defense of all defendants named in whistleblower lawsuit which could amount to hundreds of thousands of dollars.

By Brian Hews

The Central Basin Municipal Water District (CB) Board, during its February 23, 2015 regular Board meeting, voted 3-0, with Director Leticia Vasquez abstaining, to pay for the legal defense of former General Manager Art Aguilar.

Aguilar was named in the qui tam whistleblower lawsuit, a lawsuit that Director Leticia Vasquez is a party plaintiff in and stands to make $2 million if successful, along with other former employees and consultants of CB.

Embattled CB Director Leticia Vasquez.

In addition to Aguilar, who received a reported $500,000 after retiring from CB, the surprising vote paved the way for CB to fund the legal defense of all defendants named in the suit, including former General Counsel Doug Wance of Buchalter-Nemer, attorney Curtis Parvin of Sedgwick, and 50 “does.”

The vote to finance Aguilar’s defense was an astonishing turn of events.

In October 2014, Roybal, Apodaca, and Vasquez voted 3-0, with Directors Hawkins and Chacon walking out of the boardroom, to waive attorney-client privilege in the qui tam suit.

CB Board President Bob Apodaca

CB Director James Roybal

The vote signaled that Roybal and Apodaca agreed with Vasquez that the qui tam lawsuit had merit and should continue, the three essentially voting to sue themselves.

Then on Feb. 23, they voted to pay for Aguilar’s defense, obligating what could amount to hundreds of thousands of dollars to defend the District.

The vote is completely contrary to the Oct. 2014 vote, and exposes the District to significant financial liability.

The vote also raises serious questions about Roybal, Apodaca, and Vasquez’ competence as board members and their fiduciary obligations as elected officials to financially protect CB.

Director Art Chacon, who approved funding Aguilar’s defense was more direct, “Those guys are complete morons. They (Directors Apodaca, Roybal and Vasquez) didn’t follow General Counsel’s advice and took part in an illegal vote to waive  attorney-client privilege, and now we’re stuck allowing this frivolous suit to continue and are legally bound to provide a defense, which will probably wind up costing the District hundreds of thousands of dollars.”

Chacon continued, “I was not completely happy with some of the decisions Aguilar made while General Manager, but we have a duty to defend employees against frivolous suits which is why I approved the legal defense. Frankly, the vote to waive  attorney-client privilege was illegal because Vasquez clearly had a financial stake in the outcome. You have to ask Roybal and Apodaca what deal they cut in order to break the law and again place the District in financial jeopardy.”

HMG-CN was first to report in January 2015 that the Fair Political Practices Commission (FPPC) is currently conducting an investigation into the legality of Vasquez, and the CB Board vote, to waive attorney-client privilege, in addition to charges that Vasquez has falsified her residency.

See story, click here.

The qui tam lawsuit, of which Vasquez is a party plaintiff in, was filed in August 2013. The suit alleges that the defendants created a Trust Fund to develop an Environmental Impact Report in order to illegally steer $2.7-million to consultants and CB employees while escaping public scrutiny.

The named defendants in the lawsuit are former General Counsel Doug Wance, attorney Curtis Parvin, the law firms of Buchalter-Nemer and Sedgwick, former General Manager Art Aguilar, and 50 “does.”

HMG-CN has been told that the “does” include “consultants” who were paid out of the Trust.

They include former CB consultant Tom Calderon, who is currently awaiting trial on charges of bribery and money laundering, engineering firm HDR (HDR executive David Cobb is Wance’s partner), and Pacifica Services Inc., owned by the politically influential Ernie Camacho.

Vasquez stands to make over $2-million if she prevails in her suit. A hearing is scheduled for September 2015 to hear arguments that the CB Board vote to waive privilege was illegal and therefore invalid. If the court rules that the vote to waive privilege was invalid, legal experts believe that the case will most probably be dismissed.

Vasquez has claimed on numerous occasions that she is not suing the District, and insists that the District is not suffering financially because of her suit.

However, the District has reported that it has spent in excess of $300,000 on legal fees associated with the qui tam lawsuit, not including the recently approved Aguilar defense fund.

Community activist Scott Collins commented, “This seems to be a case of not learning from the past, so the District is doomed to repeat it. Vasquez was recalled from Lynwood for corruption, and she’s doing the same thing again at the District.”

CB Director Phil Hawkins commented, “This is a frivolous and wrong-headed get-rich-quick scheme. Once this is resolved, I intend to explore legal remedies to recover the unnecessary expenses that the District has incurred.”