Candidate May Face Disciplinary Hearing

The State Bar of California has found “reasonable cause” to hold a disciplinary hearing in a case against Costa Mesa attorney Dana W. Reed, a Republican candidate for state Senate, on charges that he worked at different times for both sides of a municipal ballot measure in Riverside County.

Reed acknowledged Tuesday that the bar has been investigating a complaint that he violated state conflict-of-interest laws by allegedly providing legal advice to proponents and opponents of an unsuccessful 1989 measure to legalize card casinos in Cathedral City. He denied any wrongdoing.

The State Bar conducted a yearlong investigation and, according to documents obtained by The Times, decided last summer that a violation may have occurred. However, no charges have been filed against Reed, who said he was questioned by investigators as recently as December.

“We have concluded that there exists reasonable cause for the initiation of a formal disciplinary proceeding,” William W. Davis, assistant chief trial counsel for the State Bar, wrote Aug. 29. “. . . If no disposition can be reached between the State Bar and Mr. Reed, (we will) forward the matter to the Office of Trials for formal prosecution.”

It is not clear what has happened in the case since last summer but the matter does remain open, according to George Hardie, Cathedral City’s mayor pro tem and a partner in a controversial card club in Bell Gardens. Hardie filed the complaint with the State Bar in 1989.

Davis wrote the letter to an attorney for Hardie.

State Bar officials would neither discuss nor confirm the investigation. Ann Charles, a spokeswoman for the bar, said that Hardie would be notified if the allegations were dismissed. Hardie said he has not been notified.

Reed denied that he ever worked for either side of the Cathedral City ballot initiative, known as Measure L. He said his only interview with State Bar officials about the issue was Dec. 12 and that they did not indicate that charges would be filed.

“I’ve done nothing wrong, and I welcome the bar’s investigation,” he said.

Reed is a leading candidate in the March 19 special election to replace former Anaheim state Sen. John Seymour (R-Anaheim), who was appointed to the U.S. Senate last month by Gov. Pete Wilson. Reed is facing a field of 11 other candidates, including three members of the state Assembly.

The Times learned of the Reed investigation recently, when Hardie gave The Times a copy of the Davis letter and a copy of the complaint.

Hardie said he had no association with any campaign official or candidate in the Senate race. Rather, Hardie said, he was upset that the bar has taken so long to conclude its case.

“I have no ax to grind in that regard,” Hardie said of the Senate race. “My motive is to get the State Bar off its duff.”

Hardie is a partner in the Bicycle Club, which was seized by federal agents last April during a racketeering and money-laundering investigation. Hardie was cleared in October and regained his ownership.

Hardie filed the complaint against Reed in September, 1989, which he said was shortly after he learned that Reed was working for an opponent of Measure L. Hardie said in his complaint that Reed helped him prepare the same ballot measure in early 1987 and 1988.

Voters rejected the measure in October, 1989.

Reed said he never worked for or against the measure, though he was hired by a client who was “philosophically opposed” to the plan. The client, whom he declined to identify, did not participate in the campaign, Reed said. He denied helping Hardie prepare the measure.