Despite loss after loss in court, Hillcrest’s Mat Wahlstrom is getting one more shot at suing Todd Gloria for allegedly running for Assembly and San Diego mayor at the same time and “illegally financing” his 2020 mayoral campaign.
But first Wahlstrom will try to fend off a motion to dismiss the case. That hearing — with attorney Cory Briggs newly on his side — has been set for March 18, 2022, in front of Judge Ronald F. Frazier in downtown Superior Court.
The fourth version of the suit, originally filed in August 2019, wants Frazier to order Gloria and the San Diego County Democratic Party that endorsed him to refund or reimburse at least $10,000 in donations made out of Gloria’s Assembly 2020 committee and issue a ruling that they broke campaign-finance laws.
Frazier has ruled three times against Wahlstrom, however — the latest June 4.
“Plaintiff’s sole cause of action for Illegal campaign financing still fails to state facts sufficient to constitute a cause of action,” Frazier wrote, responding to a Gloria demurrer.
In any case, the judge said, “requests for declaratory/injunctive relief are moot.”
“The 2020 election has passed and Gloria has been elected mayor since the court’s ruling on Gloria’s prior demurrer…. Thus, a declaration that Defendants are illegally financing Gloria’s Mayor 2020 campaign or enjoining Defendants from using any money from Gloria’s Assembly 2020 committee, as Plaintiff requests in his pleadings, would have no legal force or effect,” he wrote.
Frazier added that he didn’t have the power to declare “a constructive trust” and order Gloria and the local Democratic Party to pay restitution “and/or disgorge the campaign contributions.”
But the judge gave Wahlstrom “leave to amend” the lawsuit, keeping the case alive. No trial date has been set.
Attorney David Kenney of Pico Rivera — representing Wahlstrom until being replaced by City Hall nemesis (and city attorney candidate) Briggs in December — had said a court order was the only way to prevent an “abuse of the electoral process.”
Without such an injunction, he said, state-office incumbents would have an “insurmountable advantage” over rivals in local elections like San Diego’s that impose donor restrictions. (His August 2019 request for a temporary restraining order was denied.)
Neither Wahlstrom nor Briggs responded to requests for comment, including questions of what proof they had that Gloria was breaking campaign-finance provisions of the state’s Political Reform Act.
Wahlstrom apparently just alleges illegality.
“Because GLORIA had no intention of running for re-election to the office of AD78 representative, the money raised by his Assembly 2020 committee could have been used for a governmental or legislative purpose associated with his final term of office as AD78 representative,” the latest suit repeats.
“However, GLORIA used that money mostly for illegal political purposes. The expenditure of any portion of that money to [the county Democratic Party] for direct or indirect support of GLORIA’s Mayor 2020 campaign and/or opposition to any of his opponents therein constituted an illegal political purpose.”
The state’s political watchdog agency — the Fair Political Practices Commission — fined Gloria $200 for failing to timely file a Candidate Intention Statement before receiving contributions to his fund-raising committee, “Todd Gloria for Assembly 2020.”
Gloria “self-reported” the violation a day after La Prensa San Diego reported on Aug. 12, 2019, that Gloria “may have violated state law by failing to file his intention to run for re-election to the State Assembly before raising over $300,000 in a campaign committee at the same time he’s been running and raising money for San Diego mayor.”
La Prensa said raising money before the so-called Form 501 is filed is a misdemeanor punishable by up to a year in jail and a $1,000 fine. “Additionally, a fine of $10,000, or three times the amount which was improperly received, may be assessed,” said the Spanish-language news outlet.
Last May, responding to the third Wahlstrom suit, attorney Deborah B. Caplan for the Democratic Party wrote that the plaintiff casually uses the term “moneylaundering” several times.
“There is no statutory definition of that term,” she said. “But it should go without saying that it is completely legal for a candidate to make a contribution to a political party,” up to $40,500. “So a contribution by then-Assemblymember Gloria to SDCDP – or by any candidate – would be lawful.”
She also argued it is completely legal for a political party to spend money on its candidates.
Wahlstrom, said Caplan, had three chances to provide facts that would support his claims.
“At this point, it is apparent that he is relying almost entirely on his own hyperbole and speculation about Defendants’ motives,” she wrote. “In the continued absence of any factual support, it is patently unfair for Defendants to be required to defend against broad, unsubstantiated claims of unlawful conduct. The Demurrer should be granted without leave to amend.”
Frazier granted the demurrer a week later — but again gave Wahlstrom another chance to resubmit his suit.
In a telephone conference July 29, the sides met but were unable to resolve the issues raised in the demurrer request, Caplan write the court eight days later — last Friday.
“Having been specifically advised twice by this Court that the Complaint did not provide any facts that demonstrated any violations of the statutes cited, Plaintiff has doubled down,” Caplan wrote. “Since he apparently cannot supply any such facts, he has simply deleted the citations to the law.”
She said the latest lawsuit contains the “same paucity of facts, but it now also lacks any allegation that specific laws have been violated, instead simply referring to ‘illegal’ or ‘unlawful’ acts throughout.”
Democratic Party lawyer Caplan concluded:
Plaintiff has had more than two years and filed four iterations of his complaint and has yet to identify an illegal act on the part of SDCDP. He has yet to identify a single illegal contribution to SDCDP or illegal expenditure by SDCDP. All contributions and expenditures for this election were reported long ago.
Plaintiff has had ample opportunity to develop legal or factual support for his claims — if any existed — but has failed to do so. The FPPC has considered and rejected his central legal premise and the faulty legal reasoning underlying his claims of wrongdoing. No point would be served by further amendment. SDCDP respectfully requests that the demurrer be sustained as to the Third Amended Complaint without further leave to amend.
Meanwhile, Frazier is the judge in Wahlstrom’s related suit against the FPPC and Stephen Kaufman, who once served on an FPPC advisory board. (Kaufman is accused of violating conflict-of-interest statutes for having represented Gloria before the state agency.)
The FPPC, represented by state Attorney General Rob Banta and others, will argue at a Dec. 10 San Diego hearing that Frazier should disqualify that Wahlstrom suit as well.
Barbara Bry, the Democratic rival whom Gloria defeated in the November 2020 mayoral race, first raised the issue of Gloria’s parallel fund-raising committees at an August 2019 debate at San Diego City College.
This June, after the latest court ruling against Wahlstrom, Times of San Diego asked her reaction.
Bry said: “The voters deserve an accounting of how the Assembly committee funds were spent.”