Fairgrounds Update: The Forces of Goodness win Six More Precious Days…

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Wylie Aitken, counsel for the good guys

Long story short, the forces fighting against the sale of the Orange County Fairgrounds – in Norberto’s phrase the “activists and vendors” – have been given six more days during which the sale cannot proceed.  This gets us to December 21 and the next hearing, after which – if we don’t prevail – we will appeal.  And by then we will be well into the Jerry Brown administration, and by all accounts Governor Brown will scrap the sale.

It takes a bought-off hack rag like the Register to headline that story “Judge OKs Fairgrounds Sale.”  (I realize journalist Jon Cassidy didn’t choose that headline for his fine story.)  It is true that old retired Judge Michael Brenner rejected each and every argument we plaintiffs made, but he also stated very plainly that “We all know that I don’t have the last word on this,” as he packed us off to go make the same case to a different judge next Tuesday afternoon.

Dueling Subterfuges

It’s funny, maybe this is par for the course in court battles, but I was thinking how both sides couldn’t really say exactly what they meant or wanted.

The defendants – Facilities Management West (FMW) and the Department of General Services (DGS) – are desperate to consummate this deal ASAP and terrified of any more delay, for the simple reason that Governor Jerry Brown, who is generally understood to oppose this swindle, takes over January 3.  But they can’t say that, because it invites the obvious question “WHY does Brown oppose the sale?” which would be awkward for them to answer.  So they have to make the pretense that Sacramento, $25 BILLION in the hole, DESPERATELY needs FMW’s $20 million down payment THIS MONTH or there will be hell to pay – a contention even slow-witted Judge Brenner finds comical.

Meanwhile everyone knows we plaintiffs oppose the sale for substantive reasons ranging from the irreplaceable material and cultural losses to citizens and taxpayers, to general principles in holding the line against anti-public, pro-privatization ideology and policy conducted in secret.  But, since this whole swindle is cursed blessed with the imprimatur of our democratic representatives’ July 2009 approval, we are stuck hanging our hat on boring little technicalities – i’s the government didn’t dot, t’s FMW didn’t cross.

And repeatedly, unavoidably, we keep bumping our heads on the original sin of AB 4×22, the piece-of-shit bill jammed thru in the dead of night as part of July ’09’s budget mess, and signed off on by all OC legislators except Silva and Duvall.

Old Judge Brenner

The Honorable Michael Brenner had come out of retirement to take over this particular hearing while Judge Horn (he of our cherished Temporary Restraining Order) was out of town.  Judge Brenner  had obviously read through all the material more than once, but still evinced confusion and admitted to “puzzling his way through” a lot of the case.

One way in which he simplified it for himself, I think wrongly and to our detriment, was to reduce the case to a simple dispute between two businesses – the successful FMW and the aggrieved Tel-Phil whose principals would have liked to have enjoyed FMW’s success.  Of course there’s much, much more to the case, and looking at it that way just blinkered him – at the expense of us activists and the legislators.

The first thing Brenner did, as expected, was to consolidate the two lawsuits together – the first one, from Tel-Phil and other injured business interests, and the new one from legislators Correa, Solorio, Foley, and us activists.  Then he undertook to determine which party – defendants or plaintiffs – would be likely to suffer the greatest “injury” from defeat or delay.

We thought it was a good sign when he ridiculed the defendants’ claim that a delay or denial of FMW’s $20 million down payment would be a grave injury to the state:  He contrasted that amount to California’s $25 Billion budget shortfall and called the former amount “chump change.” (Our attorney Gene Livingston referred to it as “Budget Dust.”)

But then when he summarized the possible injury to us plaintiffs as merely the loss of Tel-Phil’s venue and the inability of Solorio and Correa to have a second vote on the matter, we felt he left out a lot of damages the sale would cause to members of the public, whom we of the OC Fairgrounds Preservation Society purport to represent.  In the audience, La Femme Wonkita immediately began putting together a list of further injuries our side contemplates, for the use of our counsel next time.  I won’t bother reproducing that here; you can read any of my other posts on the subject.  (Our attorney Aitken actually tried to introduce himself as representing the taxpayers and citizens of Orange County, and FMW managed to shoot that down – contending that THEY represented the democratically elected Terminator Governor, damn him.)

Then Judge Brenner began listening to our “causes of action” one by one, followed by the defendants’ responses, with the purpose of determining the “probability” of our prevailing in the future on each of these grounds.  And, unvaryingly deferential to the state, he found lack of probability on each count.  Stop here if you’re easily bored;  continue if you’re fascinated by the weeds of this case…

Rejection after Rejection

• We claim that DGS didn’t follow its own RFP (request for proposals) which calls for the deal to be “subject to legislative approval” – after the bidder and terms are determined and before it can be consummated.  This passage goes farther than the legislation that originally authorized the process, which only demands 30-day “notification.” Since there would have been no RFP if it weren’t for that legislation, we contended that the RFP had the force of legislation and the sale had to be specifically AUTHORIZED once the bidder was chosen.  Legislator/plaintiffs Solorio and Correa understood the phrase to mean another vote from both houses was needed to finalize the sale.  Brenner said, nah.

• We claim that even this 30-day “notification” was insufficient as carried out, since it consisted of an envelope handed informally to various legislative aides in the halls of the Capitol during a time the legislature was not even in session.  DGS’s counsel was all so what, we followed the letter of the law and gave notification, and Brenner was also like yeah, so what?

• We claim that the legislation demanded a “fair market value appraisal” so that the legislature could properly determine if the state was getting a good deal or giving the property away to cronies at what Senator Correa calls “a fire sale price.”  FMW and hizzonner pointed to language somewhere which stated in a very CIRCULAR manner that whatever turned out to be the winning bid would also be considered the “fair market value.”  So no cigar there either.

• We claim that the legislation originally authorizing the sale was itself unconstitutional because – and this is convoluted – the proceeds from the sale of “surplus property” are required by statute to be directed to reducing “bond indebtedness,” not just dumped into the General Fund as the leg. intends;  anticipating this and other complications the leg. made a point of saying the Fairgrounds is NOT surplus property;  but we contend that they are TREATING it as surplus property and hence the expected proceeds are going to be misdirected.  (I hope I have all that right.)  Brenner was all, don’t be silly, of course it’s not surplus property, it’s just property the state wants to sell for some damn reason.

• We claim that FMW didn’t even make a half-assed effort to comply with all the requirements the RFP listed for bids. The RFP had listed criteria it would require from each bidder, such as the names and financial details for all investors, and a plan for who was going to end up managing the property.  The other bidders besides FMW followed this to the letter, with pages and pages of org charts and financial data.  FMW didn’t bother – I think I heard their entire bid was just five pages, and included no names of investors or where their money would come from, and no business plan.  They obviously knew they didn’t have to bother, as the fix was in for them.  Judge Brenner pretty much said big deal, they can give that information later.

• We also claim that the last auction was rigged in favor of FMW in various ways.  DGS had refused to comply with all our public records requests until JUST BEFORE this hearing, so we and the judge were examining the bids and related documents for the first time.  (DGS obviously not.)  Both sides were able to point to the complicated financial details shown in the documents and spin them in their own ways:  the plaintiffs to show that other parties had made better offers than FMW, FMW’s counsel claiming no, this shows their bid was best.  All the complex details – the amortization, balloon payments, interest, etc., made Brenner’s head spin like the rest of ours.  Predictably, he held once again that FMW and the state were probably right and that we wouldn’t prevail on the favoritism charge either.

• Right around this point, our Gene Livingston who had contended that “any of these causes on their own would be enough to shut this deal down,” decided to back off that bold stance and ask the judge to consider the TOTALITY of these weaknesses, insisting added together they make the process a “sham.” “Strong word there, sham.”  “Yes it is, your honor, and let me show you why I use it.”  But sham didn’t fly either, with Judge Brenner.

• We also requested that FMW and the state should be held in contempt of the Temporary Restraining Order (TRO) that Judge Horn had put on them last month – they were supposed to hold off altogether on proceeding with the sale, yet they IMMEDIATELY set to work firing all the state workers and then gathering them together to offer them their jobs back under FMW’s hoped-for ownership.  And that’s just what we KNOW about.   But Judge Brenner brushed off our suggestions that this constituted contempt, with contempt.

Toward the last hour of the hearing, as Judge Brenner genially droned on and on about things he knew nothing about,  our attorneys gradually reached the conclusion that it was a waste of time to continue to argue or correct him;  no matter what, he was going to side with the state and FMW.  So you had the Judge up there pontificating about how FMW had no advantages regarding knowledge of the property, how any of the other bidders could have had access to anything and any information on the site, and in the audience you could see Katrina, Sandy, and Costa Mesa City Attorney Kim Barlow shaking their heads, rolling their eyes and mouthing “that’s not true” like Sam Alito, while our attorneys stood there silent and resigned.

As Marx said to Engels after his exile, “On to the next dance!”

Thank God we will have a different Judge on Tuesday afternoon;  almost anybody would give us a fairer shake than we got Wednesday from this judge.  Brenner gave the impression of not wanting to make waves, and siding uniformly with the state is I suppose the best way to not make waves.  Judge Horn, he of the TRO, thought we had some very substantial claims, and no doubt the next judge will too.  But all we really need is a couple weeks’ more delay, and Orange County citizens will be home free with our Fairgrounds intact, and the plutocrats wailing, rending their garments and gnashing their teeth!  That will be something to see.