Probes of ex-Hahn commissioner end

Two law enforcement agencies have closed their investigations into former Los Angeles Airport Commissioner Ted Stein, a figure in the “pay-to-play” investigation that helped end the political career of former Mayor James K. Hahn, according to correspondence obtained by The Times.

Because no charges were filed, Stein now wants the city to pay his legal costs.

Stein, a private attorney who resigned from the Airport Commission in 2004, received letters over the last two years from the U.S. attorney’s office, the Los Angeles County district attorney’s office and the city’s Ethics Commission saying their scrutiny of him had ended.

The letters were reviewed this week by the city’s Airport Commission, which is trying to decide how to respond to Stein’s request for reimbursement of $145,000 in legal bills incurred while serving as a volunteer commissioner in the Hahn administration.

The commission, which oversees Los Angeles World Airports, has reviewed another $48,000 in legal bills from three other Hahn-era airport officials, including former Commissioner Cheryl Peterson. Even more legal claims could be submitted after today, when a judge is scheduled to sentence Leland Wong, a former Hahn appointee who was convicted on corruption charges in July.

Wong’s sentencing could spell the end to the five-year probe of the Hahn administration, spurring other former officials from the airport, Port of Los Angeles and the mayor’s office to seek repayment for their legal costs.

Gina Marie Lindsey, Los Angeles World Airports’ executive director, had no comment on the legal bills.

But Stein’s attorney, David J. Schindler, said his client should not have to pay attorneys’ fees incurred while responding to “baseless attacks” that resulted from his time on the commission.

“From the outset, Ted was the victim of false rumor and innuendo, much of it repeated without any scrutiny by several publications, including the L.A. Times,” Schindler wrote in an e-mail. “We always had great confidence that any fair-minded investigator would conclude that there was no merit to any of the scurrilous accusations that were leveled, often anonymously, against Ted.”

Four years ago, The Times reported that state and federal prosecutors were investigating allegations that Stein had tried to fire an airport contractor because it had refused to donate to Hahn’s 2002 campaign against San Fernando Valley secession.

At the time, URS Corp. was managing preliminary planning and environmental analysis for Hahn’s proposed modernization of Los Angeles International Airport. Executives with the company told investigators that a lobbyist had asked them to provide $100,000 to the anti-secession campaign, saying it should be given through Stein. URS officials also said they were told that the contribution would make their work at the airport go more smoothly.

Stein denied the allegations, saying he had been unhappy with the company’s performance, not its refusal to contribute. He told The Times that he had quarreled regularly with URS over the quality, speed and cost of its work -- and its ability to handle the modernization plan.

The controversy helped to inflame a corruption investigation that turned its focus toward Wong, a former city commissioner who was investigated on a separate matter at the airport and harbor, and the public relations firm Fleishman Hillard, whose executives were convicted in a case that centered on accusations of overbilling the city.

The investigations of Stein, Wong and Fleishman Hillard left Hahn politically wounded, and he lost his bid for reelection in 2005. Mayor Antonio Villaraigosa, then newly elected, replaced the head of the airport agency and scrapped a majority of the modernization projects that Stein had pushed for at LAX.

Deputy Dist. Atty. Max Huntsman, who wrote the letter to Stein in May 2007, said his office looked at various allegations and found it did not have a case that could be proven beyond a reasonable doubt.

“When people talk about pay-to-play, that frequently covers a lot of stuff that is bad government, and perhaps appropriate to newspaper articles, but not criminal,” he said. “As to specific allegations, the facts have to be proven in court, and if they can’t be, there’s no prosecution.”

The city of Los Angeles does not cover the legal bills of employees and political appointees who have been convicted of a crime.

But if they are asked to testify on behalf of the city during an investigation that stems from their work, they may submit claims seeking reimbursement for legal bills.

In 2004, City Atty. Rocky Delgadillo issued a letter informing city workers that his office was ready to represent anyone who received a subpoena.

Officials in at least three city agencies responded by retaining their own lawyers, despite a warning from Delgadillo that they might not get their money back from the city.

“Because the city has no legal obligation to reimburse this expense, there is no guarantee the city will pay for it,” he wrote.

Former Los Angeles World Airports Executive Director Kim Day, who was forced out by Villaraigosa in 2005, has submitted a claim for $23,364 in legal bills. Jim Ritchie, the agency’s former deputy executive director, requested $20,584.

Airport documents show that at a rate of up to $750 per hour, Schindler billed Stein for such tasks as calling lawyers in Dist. Atty. Steve Cooley’s Public Integrity Division, which investigates such matters as government corruption.

The letters from investigators were sent in 2006 and 2007 and offered Stein and his lawyer no information on the findings of the investigation, which involved state and federal grand juries.

A December letter from the Ethics Commission to Stein’s lawyer contained only two sentences. “Thank you for your client’s patience and cooperation with our investigation,” wrote Kirsten Pickenpaugh, the commission’s assistant director of enforcement.

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david.zahniser@latimes.com