California

California Town Hired Private Law Firm to Sue Citizens, Then Tried to Conceal Massive Costs

Fontana called them "zoning fees." They were actually demanding that residents repay the cost of prosecuting them for minor crimes.

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Gimme the cash
Dmitry Rukhlenko / Dreamstime.com

Peter Nolopp, now 79, pleaded guilty seven years ago to renting land for an illegal scrapyard. He paid a fine—$1,000—and cleaned it up. Three years later, the California city of Fontana sent him a bill demanding $29,000 to recoup the cost of his own prosecution.

$24,000 of that were listed as "zoning fees." In fact, they were legal fees billed by a private law firm, Silver & Wright, that Fontana had contracted to prosecute cases for the city.

Fontana is the third California desert town now known to have used this firm to prosecute nuisance cases and code violations, then turn around and demand thousands of dollars from citizens months—even years—after they settle. Desert Sun reporter Brett Kelman has previously exposed the cities of Indio and Coachella for their connections with Silver & Wright; the Institute for Justice and the law firm O'Melveny & Myers are now suing Indio to stop what they're calling a "for-profit prosecution scheme."

Here's how it works. People plead guilty to code infractions—having a messy yard, keeping illegal chickens, adding unpermitted home improvements—and agree to pay modest fines. They say they are not told that this agreement exposes them to demands for additional fees to recoup the cost of their own prosecution, and that these fees are not reviewed by a judge. Instead they receive bills much later for thousands of dollars, complete with threats to put liens on their properties if they don't pay up. And if they attempt to appeal these fees, they are charged additional fees to pay for the cost of the city fighting their appeal.

Kelman reports:

Over the past decade, officials in the city of Fontana have billed residents no less than $43,000 in prosecution fees but classified those debts as unexplained costs or vague "zoning fees." Instead, city records show this money is used to fund the city's privatized prosecutors, the law firm Silver & Wright, which has anchored its business model on making the defendants pay to prosecute themselves. Defendants like Nolopp have said they were unaware they would be billed until after they pleaded guilty, and the billing process occurred entirely outside of the courtroom, so the amounts were never reviewed or approved by a judge.

Additionally, Fontana collected $35,000 through "civil compromises," which are legal agreements in which prosecutors dismiss minor criminal charges if a defendant pays money to the city in an out-of-court settlement. The majority of this money, more than $28,000, was also used to pay Fontana prosecutors, according to city records.

Kelman further notes that the city documents he examined were vague and incomplete. He was able to determine that Nolopp's "zoning fees" were really legal costs because somebody actually wrote it on the bill. So it's not clear whether other charges to other people labeled "zoning fees" are actually zoning fees or legal fees.

Silver & Wright's work with Fontana may have been part of the firm's origin story. The company was founded in 2013 in the midst the attorneys doing work with the city. It then started advertising this mechanism to other cities in California. The firm's website once promised that it could make a city's code enforcement process "cost neutral or even revenue producing." After the Desert Sun revealed what has happening and the lawsuits started to fly, the firm removed the "revenue producing" bit from the site.

Money
presentation slide

The Institute for Justice has gotten its hands on a PowerPoint presentation the law firm used at a conference to promote its practices to other cities. One slide, titled "cost recovery," features a stock image of a woman overloaded with bundles of cash and an offer that cities can recover all costs of code enforcement, including "attorney's fees." The institute plans to use the slide as evidence of profiteering by the cities and the firm.

In a strange response, Silver & Wright is claiming that the money from these prosecutions actually goes to the city, not to them. It has a contract with the cities and gets paid regardless of whether it gets convictions. Of course, these fees being recovered are for paying Silver & Wright in the first place for a process that the firm itself cooked up and sold to the cities, promising them that they would recoup these costs. So I'm not entirely sure why they think it's a compelling argument.

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  1. Do progressives have any interest in addressing massive attorneys fees?

    1. Fontana is in San Bernardino county, which is an Eastern county. It has a 3.7% spread between Democrat and Republican voters–slightly in favor of Democrats. Not exactly your progressive stalwart county.

      I do find it interesting that they privatized city services like that. Sounds like they’re more libertarian than progressive.

      1. Fontana is desert? I guess just about every place in Southern California is desert, then…

        1. It pretty much is, yes.

      2. Libertarianism isn’t about privatizing government functions. Privatizing government services is one thing, but only because government shouldn’t be doing it in the first place. But privatizing core government activities invariably leads to abuse. If it’s wrong for government to be doing something, then it’s also wrong to be contracting it out.

        In this case, however, nothing is privatized, it’s just the city telling a private firm it can use the color of the state to extort money. If the judge in the case did not specify the defendant must play the plaintiff’s legal fees, then the defendant does NOT owe legal fees! In other words, that $1000 fine is only $1000. Period. None of this $28,000 extortion racket.

        Really, get a dictionary and look up “libertarian”. Sheesh.

        1. It’s the same kid that just learned the difference between data and confirmation bias, like, four days ago. I’m sure he’ll start reading stuff once he realizes he’s at a disadvantage.

        2. Brandybuck: Well explained. As libertarianism gets known a lot of statist politicians are claiming it. It is confusing to the general public, which of course is the forte of politicians.

          I once was talked into joining/working for (1973) the LP. I was told it was 20% anarchist and they were the activists who used the political system to get the public to listen to our message. And that was the only goal. I fell for it because I wanted to do more than quietly live as free as possible in an unfree world. I learned the hard way that libertarian people who work within the system are changed by it, not the other way around. I quit in 1980.

          1. ” I learned the hard way that libertarian people who work within the system are changed by it, not the other way around”
            That’s been my observation as well. We had an LP member get elected to the local community college board. Her primary goal was to provide free daycare so moms could go to college. Sounded like welfare statism to me but she was sure there must be something libertarian about it. We had another on the local public school board who voted to force students to wear uniforms. When I asked him whose liberty he was defending he told me it was OK because a majority of parents at each school had to vote in favor. So defending the liberty of the majority to impose their will on the minority is a libertarian concept. I’ve known non libertarian politicians who were a hell of a lot better for liberty than LP members. One of the reasons I don’t carry a party card.

    2. Of course; look at the attorney contributions to progressive candidates.
      So the addressing that progressives want is to jack up the lawyer revenue as far as possible. This results in large donations, and a bunch of 1%’rs to tax the hell out of.

  2. Wow. That’s pretty low even by government standards.

  3. Maybe the ACLU could also take up this case and shine a light on this practice?

    I kid…

  4. This really isn’t a big step from the “court costs” that defendants are hit with in many states that turn a $150 traffic ticket into a $500 traffic ticket. It should raise the question of, if court costs are being tacked on like a user fee, what the hell are my taxes funding? And it’s not just the courts, half of your government functions are funded through user fees, so where’s all the tax money going?

    1. I’m just guessing, but San Bernardino county’s main industry is a trucking hub. It’s not a bastion of wealth. I imagine their tax revenue is pretty low and these kinds of actions might look expensive by comparison.

      1. You guess huh. Perhaps you could have bothered to find out that Fontana was once home of a major steel mill. Not a very CA kind of business though.

        1. Not compared to government-sponsored shystering of money out of the populace, no, it isn’t.

    2. where’s all the tax money going?

      Public sector pensions?

      1. Ding, ding, ding!

        1. We have a winnar! AND losers.

    3. Yes it is different. Those traffic ticket court costs are disclosed from the start, not billed years later. The plea deal didn’t mention them, the verdict didn’t mention them.

  5. This is also a good place to re-post this goody wherein a law professor challenges a red-light camera ticket and finds out the law isn’t necessarily the law.

    Yet traffic cameras do not always produce probable cause that a particular person has committed a crime. To get around this “problem” (as a certain law-and-order president-elect might call it), several states have created an entirely novel phylum of law: the civil violation of a criminal prohibition. Using this nifty device, a city can charge you of a crime without any witnesses, without any probable cause determination, and without any civil due process.

    In short, municipal officials and their private contractors have at their disposal the powers of both criminal and civil law and are excused from the due process duties of both criminal and civil law. It’s a neat trick that would have made King George III blush.

    1. The BFYTW statute

    2. Huh. At some point, if the law enforcement agency’s job turns into revenue collection for the sake of revenue collection, and not as fines for actual, documented infractions, one starts to wonder why the locality needs the law enforcement agency.

  6. I’m amazed at how the outrage on a libertarian blog is more about the scummy practice of charging people the cost of their own prosecution and not the zoning laws at the root of the situation.

    If the property owner could rent out his property to anyone without concern for zoning restrictions, this would have never happened. He cold have put nuclear waste on there and had no trouble.

    1. Amazing isn’t it that real libertarians aren’t just like the caricatures in your head?

    2. Because I want to stop a bad thing from happening to real people in the real world that is harming them and can actually be stopped, as opposed to proselytizing about a libertarian philosophy and preaching to choirs.

    3. Outrage is a limited commodity. Those zoning laws will just have to wait their turn.

    4. “I’m amazed” you think “the root of the problem” is a law. It is democracy, i.e., the belief that the majority has the right to enslave the minority to their will. Of course, only individuals have rights. A group has no right that trumps an individual right because that would contradict the definition of rights. This mistake has kept humanity from being civilized. If not corrected it will destroy our species.

  7. features a stock image of a woman overloaded with bundles of cash

    If that’s the picture you posted, it’s not “bundles of cash”, it’s a god-damned money tree. As in, money grows on trees.

  8. “I’m not sure why they (the city’s legal hit-men) think it is a compelling argument.” What difference does it make? The time is past when govt. had to justify anything. They can legally murder unarmed citizens, thanks to the majority who have surrendered their humanity (and your’s) to the police state.

  9. Is it that only evil bastards run for office or do they become evil bastards after being elected?

  10. As the pension pyramid begins to burst in CA, and the limit on state and local tax deductions drives well to do Californians out of the state, this kind of shake down will become more and more common.

    When jurisdictions lose their tax base, local regulatory agencies and law enforcement become the new tax men. It’s all just shakedowns from here on out.

  11. Where’s a mass shooter when you really, REALLY need one?

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