LOS ANGELES—A former Los Angeles Department of Water and Power board member linked to an alleged bribery scheme was facing State Bar of California disciplinary charges July 10 for allegedly soliciting and receiving more than $31,000 in free legal services from an attorney connected to the 2017 LADWP billing scandal.
The State Bar alleges that in the summer of 2017, attorney Bill Funderburk was set to vote as a DWP Board Commissioner on a $30 million no-bid contract for a business created by lawyer Paul Paradis—a cooperating witness in the billing scandal—to provide consulting services to the utility.
At the time, Mr. Paradis was covertly assisting in the settlement of a class action suit brought on behalf of DWP ratepayers against the city of Los Angeles following the disastrous rollout of a new DWP billing system overseen by PricewaterhouseCoopers, in which some ratepayers were drastically overcharged, while others were undercharged.
Mr. Paradis and attorney Paul Kiesel were working for the city in its litigation against PWC at the same time Mr. Paradis was working covertly with class counsel to arrange a settlement of the ratepayer class action on terms favorable to the city.
According to the disciplinary notice, Mr. Funderburk was initially supportive of granting the contract to the business. In the weeks before the DWP’s June 2017 vote, however, Mr. Funderburk let the utility’s officials know that he was reluctant to support the contract.
Around the same time, Mr. Funderburk began sending text messages to Mr. Paradis to request and receive free legal services valued at more than $31,000 for an unrelated litigation matter. Soon after, Mr. Funderburk said he would vote in favor of Mr. Paradis’ contract, according to the State Bar.
In a brief conversation outside the meeting room before voting to approve his contract, Mr. Funderburk allegedly told Mr. Paradis, “You take care of me, I take care of you.”
State Bar Chief Trial Counsel George Cardona said in a statement issued Wednesday, “As a steward of the City of Los Angeles’ Department of Water and Power overseeing an annual budget of $5.5 billion, Mr. Mr. Funderburk had an ethical and legal obligation to ensure that he did not take actions that might appear to be influenced by any conflicts of interest or gifts that he received. The disciplinary charges are based on his failure to comply with these obligations.”
Mr. Funderburk also faces disciplinary charges related to allegedly asking Mr. Paradis to make a $2,700 donation to an unnamed U.S. Senator’s campaign during a time that such a donation would not be allowed given Mr. Funderburk’s city oversight of a business agreement with Mr. Paradis within the previous 12 months, according to Mr. Cardona.
“Bill now joins a long list of lawyers accused of misconduct by the architect of a massive scheme to defraud the city. Paul Paradis named Bill and as many as 18 other attorneys in an ultimately unsuccessful attempt to save himself from prison,” JL Handzlik of Handzlik & Associates, who represents Mr. Funderburk in the State Bar matter, said in a statement provided to City News Service on Wednesday.
“Bill did nothing wrong. He did not seek or receive legal services from Paradis. Bill also did not solicit a $2700 contribution from Paradis. He sent out a commonplace mailer about a fundraising event for a U.S. senator from New York to numerous individuals. Among other things, it was unrelated to LADWP or the city. Once the full story is known, we feel confident Bill will be exonerated,” Mr. Handzlik continued.
Thomas Peters, a former senior lawyer for the L.A. City Attorney’s Office, was summarily disbarred in February following his felony conviction related to the DWP billing scandal. Mr. Peters was sentenced to nine months of home detention last year after pleading guilty to a federal extortion charge and agreeing to cooperate in the probe into the city’s handling of the botched launch of the DWP billing system.
State Bar disciplinary proceedings on charges against attorney Michael Libman for his role in the matter are ongoing, the agency said.
