(January 13) Federal prosecutors will not pursue a criminal case against any of the defendants involved in the Colonies Lawsuit Settlement Public Corruption Prosecution that is proceeding in state court, according to a motion filed by the U.S. Attorney’s Office in U.S. District Court on January 13.
While Assistant U.S. Attorney Joseph Widman said in the motion that the federal government’s investigative and prosecutorial action with regard to defendants Jeff Burum, Jim Erwin, Paul Biane and Mark Kirk has concluded, he intimated that materials both relevant and irrelevant to the case that were seized during an FBI search of Burum’s home and office in September 2011 have been turned over to the district attorney’s office and remain in that agency’s possession despite a court order calling for privileged materials to be destroyed or returned to the defendants.
In February 2010, the California Attorney General’s Office and the San Bernardino County District Attorney’s Office filed conspiracy, extortion bribery and related charges against former San Bernardino County First District Supervisor Bill Postmus and former San Bernardino County Sheriff’s deputies union president Jim Erwin, claiming the November 2006 vote of the board of supervisors to confer on the Colonies Partners a $102 million payment to settle a lawsuit that company had brought in 2002 against the county over flood control issues at the Colonies at San Antonio residential and Colonies Crossroads commercial subdivisions in northeast Upland was tainted by coercion, threats and bribery. Both Postmus and Erwin pleaded not guilty to those charges but in March Postmus pleaded guilty to all 14 charges in the indictment against him and another unrelated drug possession charge. In May 2011, after another grand jury was impaneled and Postmus appeared before it as the star witness, a superseding indictment was handed down renaming Erwin and naming Burum, Biane and Kirk.
Four months later, on September 15, 2011, after the federal government’s interest in the matter had been hinted at for more than a year, that interest was confirmed when the FBI served nine search warrants issued by United States Magistrate Judge Oswald Parada at various locations, including the premises of the four defendants. Burum, whose office and home were searched, resulting in the removal of several of his computers and communications devices, on September 20 and October 3, 2011 filed motions with Parada seeking the return of digital devices which he said were critical to his businesses’ operations. Parada eventually agreed to have the devices and/or data essential to Burum’s business operations returned to him. On November 10, 2011, Parada held a hearing in which he heard arguments that the federal government had exhibited “callous disregard” for Burum’s rights in seizing his property, that the government’s action had irreparably harmed Burum, and that the government should return all of the property it had seized. Parada made a finding that despite misstatements by federal agents that had been previously filed by the court with regard to the matter, the government had not shown the “callous disregard” for Burum’s rights and that the government did not have to return to him the items it had seized from him. Parada did, however. accede to the appointment of a special master to determine which data and materials obtained in the searches was relevant to the case and could be permanently retained by the FBI and U.S. Attorney’s Office and which materials or data would ultimately need to be returned to Burum or destroyed.
The FBI assigned agents that were not working on the Colonies Partners case to review the materials as part of the special master process.
While Parada’s orders clearly specified that the FBI’s review of the relevancy of the materials seized at the seven locations other than Burum’s home and office had to be carried out first within 60 days and then 120 days after the FBI sought and obtained a 60-day extension, the FBI interpreted the 120-day review deadline as not applying to Burum’s materials that were to be reviewed by a special master. While Burum’s materials were yet in the custody of the agents carrying out the relevancy review, on May 16, 2012, digitized copies of them and their data were handed over to the San Bernardino County District Attorney’s Office.
Under the terms of the warrants themselves and Parada’s later orders, government officials were to return any seized materials or data found to be irrelevant to the case and “delete or destroy all forensic copies” of irrelevant materials or data.
On September 20, 2013, the district attorney’s office, as part of the discovery process in the state case pending against Burum and his co-defendants, handed over to Burum’s attorney, Stephen Larson, a disk containing forensic copies of materials seized from Burum. On September 27, 2013, Larson referenced the district attorney’s possession of that disk during a court appearance in the pending criminal case. The state court ordered the district attorney’s office to segregate and not review materials seized during the searches of Burum’s residence and office building pending resolution of Larson’s objection to the provision of material that was supposed to have been returned to Burum or otherwise destroyed being provided to the district attorney’s office. Larson then contacted the U.S. Attorney’s Office, referenced the district attorney’s Office’s production of the forensic copies that were by federal court order supposed to have been destroyed and asked whether any additional data subject to the special master order had been provided to the district attorney’s office. The U.S. Attorney’s Office agreed to look into it. It was subsequently determined that the district attorney’s Office had another disk containing forensic copies of data seized from Burum’s computers and communications devices. One of the district attorney’s office’s investigators claimed to the U.S. Attorney’s Office that the second disk in question had not been reviewed.
On October 9, 2013, Larson met and conferred with the U.S. Attorney’s Office by means of a telephone conference regarding how to resolve the situation and on October 11, Larson followed that up with a letter raising various grievances regarding the government’s investigation and the FBI’s provision of the disks to the district attorney’s office.
On October 17, 2013, the U.S. Attorney’s Office responded to Larson’s letter, saying it intended to ask the district attorney’s office to return the disks and to delete the disk data.
According to Widman, the district attorney’s office has defied that request.
“The government asked the district attorney’s office to return the disks; the district attorney’s office declined to do so,” Widman stated in his January 13 motion. “The district attorney’s office asked the government to refrain from deleting the disk data, since its status had not been ruled upon in the pending criminal case. On November 1, 2013, the government informed movant [i.e., Larson and Burum[ that it intended to abide by the district attorney’s office’s request and not voluntarily destroy the disk data. To date, the district attorney’s office has not returned the disks to the government.”
Widman’s January 13 motion came in response to a petition by Larson to the U.S. District Court in Riverside to have Burum’s property returned to him and the court’s orders regarding the special master to be amended accordingly.
While the revelation with regard to the district attorney’s office’s tenacious hold on the materials in question would suggest that the prosecution in the state case is taking a no-holds-barred approach to proceeding with the matter, Widman’s inclusion of notice that the U.S. Attorney’s Office will not be pursuing a prosecution against the Colonies Lawsuit Settlement Public Corruption Prosecution defendants was roundly hailed by the defendants and their supporters, and interpreted as a sign of weakness in the state’s case.
“The federal statute of limitations on the charges the government was investigating has expired without the filing of federal charges,” Widman stated in the motion.
Larson on Tuesday told the Sentinel “We think this is a big deal. Both the U.S. Attorney (in paragraph one of the brief) and the FBI (in paragraph seven of Special Agent Jonathan Zeitlin’s declaration) publicly acknowledge for the first time that the federal investigation, which involved search warrants, federal grand jury testimony, interviews, extensive subpoenas and financial analysis, etc., is concluded with no charges being filed.”