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Joel Brown |
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Corruption Indictment By Amanda Bronstad LOS ANGELES — Following the recent indictment of Orange County, Calif., Sheriff Michael Carona, a vicious fight has broken out over legal fees and allegations of legal malpractice between a former member of Carona's staff and personal injury lawyer Joseph Cavallo. Carona was charged by federal prosecutors in a 10-count indictment unsealed last month that outlines how he allegedly conspired to use his office to enrich himself just before his election in 1998. Also indicted were Carona's wife, Deborah Carona, and his mistress, Debra Victoria Hoffman, a partner at Jaramillo, Hoffman & Associates, along with one of Carona's former aides. The aide, Assistant Sheriff George Jaramillo, has pleaded guilty to filing false tax returns, according to papers unsealed last month. A second plea agreement unsealed last month involved another former Carona aide, Assistant Sheriff Donald Haidl, who pleaded guilty to one count of filing a false tax return during the time he was paying mounting legal fees to Cavallo to defend his son in a high-profile gang rape trial. Cavallo obtained a hung jury for Haidl's son, who was convicted in a second trial. Cavallo and Haidl are alleged to be co-conspirators with Carona in the government's case. But their relationship with each other has soured. Cavallo has sued Haidl for more than $1 million in unpaid legal fees. Also, Haidl and his son have accused Cavallo of legal malpractice and using funds for the rape case for other costs, such as paying a bail bondsman who pleaded guilty in an Orange County district attorney's probe. Cavallo v. Haidl, No. 06CC12862 (Orange Co., Calif., Super. Ct.). Last month, Cavallo pleaded guilty in that same investigation to charges that he schemed with bail bond agents to steer illegal referrals to him. He is scheduled for sentencing on Dec. 14. His lawyer, John D. Barnett of the Law Office of John D. Barnett in Orange, Calif., did not return calls seeking comment. Carona, his wife and his mistress pleaded not guilty earlier this month to charges of accepting cash and gifts worth hundreds of thousands of dollars. In the indictment, prosecutors outline a conspiracy that also includes Cavallo (referred to as J.G.C.), Haidl and Jaramillo, who allegedly benefited from access to Carona's office. In his plea agreement, Haidl admitted filing false tax returns related to thousands of dollars in checks he was paying Cavallo during his son's case. Haidl deducted the legal costs of the case from partnerships and trusts he controlled, even though he "knew that these payments were not related to the business purposes of the companies from which he had the checks written," the plea agreement states. He also failed to account for the income used to pay the legal fees on his individual tax returns. The false returns resulted in a total tax loss of between $200 and $400 million. Thom Mrozek, spokesman for the U.S. Attorney's Office for the Central District of California, declined to comment for the prosecution. Haidl's lawyer, Mark Byrne of Byrne & Nixon in Los Angeles, said only: "If asked to testify, we will testify truthfully." But Cavallo and Haidl, who are both expected to testify against Carona, aren't a united front due to Cavallo's suit against Haidl and his son. In April, Haidl and his son filed a counterclaim in that case alleging breach of oral contract and fiduciary duty. They claim that Cavallo agreed not to accept attorney fees during the first trial while Haidl paid costs and expenses. In the second trial, those costs totaled $850,000. Cavallo's lawyer in the case, Michael Sachs of Callahan & Blaine, and Haidl's lawyer, James P. Collins of Los Angeles-based Cotkin & Collins, both in Santa Ana, Calif., did not return calls seeking comment.
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A Feast
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