Federal prosecutors have recommended a reduced prison term for a former top official at the LA City Attorney's Office in consideration for his extensive cooperation with FBI and California State Bar investigations into a scheme to rig a multi-million-dollar legal settlement between thousands of residents and businesses and the LA Department of Water and Power.
Thomas H. Peters, once the chief of civil litigation, is the most senior, former member of the City Attorney's Office staff to plead guilty to criminal charges stemming from the 2013-2014 DWP billing scandal, in which the utility began overcharging its customers after installing a new computer system.
The, "collusive litigation scheme," described by federal prosecutors in court papers, involved the City secretly drafting the class-action lawsuit filed against the DWP by its customers, so the case could be quickly settled for $67 million on the City's desired terms.
To date -- the former general manager of the DWP, David H. Wright, and a former executive, David F. Alexander, have been sentenced to prison, and a private attorney, Paul O. Paradis, has pleaded guilty to a bribery charge, in schemes related to the fallout from the billing errors.
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Peters admitted in a 2022 plea agreement on an extortion charge that he used his position as a top official in the City Attorney's Office, to pressure Paradis to pay $800,000 to a still un-named blackmailer, who in 2017 was threatening to publicly expose the City's secret role in manipulating the class action settlement.
The U.S. District Court's Probation Office said Peters should be sentenced to a term of 41 months in prison, but prosecutors have asked the judge for an abbreviated 18-month term, crediting Peters for his, "substantial assistance," with the investigation and "extensive cooperation with the California State Bar."
Details of the cooperation were blacked-out across multiple pages of the U.S. Attorney's Office sentencing memo, and were redacted from Peters' defense attorney's filing that requested a sentence with no prison time.
"Mr. Peters' willingness to accept responsibility and cooperate stands in stark contrast to many other individuals involved in the underlying litigation who engaged in serious misconduct," defense attorney Jeffrey H. Rutherford wrote in a sentencing memo.
The $800,000 extortion payment was allegedly approved during a December 2017 meeting at the LA City Attorney's Office involving its most senior staff, according to court documents.
Former City Attorney Mike Feuer was listed on his own calendar as a meeting participant but he said he never knew of an illegal scheme.
"The City Attorney has no specific recollection of that meeting--more than four years ago--but certainly was not informed at that time, or any time, of any criminal malfeasance," Feuer's former spokesman Rob Wilcox said last year.
Federal prosecutors said last August that Feuer was not a target of its investigation.
Multiple sources have told the I-Team that evidence gathered by the FBI has been shared with the California State Bar, which has opened misconduct investigations into several attorneys who worked at the City Attorney's Office.
Peters' sentencing hearing is set for Tuesday, May 9.
