Appellate Court Rebuffs Colonies Case Prosecutors For The Second Time

For the second time, the Fourth District Court of Appeal in Riverside has dealt prosecutors a crippling setback in their effort to convince a jury that the 3-2 decision of the county board of supervisors nine years ago to confer a $102 million payout on the Colonies Partners development consortium to put to rest a lawsuit that company had brought against the county over flood control issues at the Colonies at San Antonio residential and Colonies Crossroads commercial subdivisions in Upland was tainted by extortion, bribery, kickbacks, fraud and graft.
Jeff Burum, who with Dan Richards was one of the two managing principals in the 19-member Colonies Partners, was accused by prosecutors in a 29-count indictment handed down in May 2011 of having worked with former San Bernardino County sheriff’s deputy union president Jim Erwin to first extort and then bribe former county supervisors Bill Postmus and Paul Biane to get them to vote in favor of the settlement in November 2006 and then providing a kickback to Mark Kirk, the chief of staff to the other supervisor, Gary Ovitt, whose third vote for the settlement was crucial to its passage.
The indictment was built around the theory that Burum and Erwin, with the assistance of public relations consultant Patrick O’Reilly, conspired to threaten Postmus and Biane with exposure pertaining to their respective homosexuality/drug use and financial insolvency during the 2006 campaign season when Postmus was vying for county assessor and Biane was stumping for a measure to increase the pay of county supervisors. The indictment further charges that the conspiracy broadened and intensified with the provision of four separate $100,000 kickbacks provided to Postmus, Biane, Kirk and Erwin in the form of contributions to political action committees each of those parties set up or arranged to have set up after Postmus and Biane acceded to the threats and voted to approve the $102 million settlement. Kirk, according to the indictment, was rewarded with the $100,000 donation to his political action committee for having persuaded Ovitt to vote for the settlement.
The strength of the indictment in large measure hinged on guilty pleas by Postmus on a host of political corruption charges relating to the alleged scheme, including conspiracy, bribery, fraud and criminal conflict of interest. Both Postmus and Erwin had been previously charged in February 2010 with criminal wrongdoing in relation to the settlement and Postmus’s guilty pleas came in March 2011, one month before he became the star witness before the grand jury that indicted Burum, Biane, Erwin and Kirk.
But there were inherent problems with the indictment, not the least of which was the delay in the time that the prosecutors indulged in before bringing the indictment, which came four-and-a-half years after the settlement vote and nearly four years after the last overt act alleged in the indictment, consisting of the final contribution to the political action committees. Moreover, the reliance upon Postmus as the key witness in the matter has proven highly nettlesome for the prosecution team, consisting of the San Bernardino County District Attorney’s Office working in conjunction with the California Attorney General’s Office.
Shortly after the indictment was handed down, defense attorneys filed demurrers challenging the sufficiency of the case on a number of legal, factual and technical grounds. In August 2011, Judge Brian McCarville granted several of those demurrers, throwing out many of the charges. The prosecution appealed McCarville’s ruling to the Fourth District Court of Appeal, a move which was matched by the defense attorneys, who asserted that McCarville should have dispensed with more of the charges than he actually did. The Fourth District Court upheld McCarville on all but one of his rulings favoring the defense and, in addition, threw out even more of the charges. Prosecutors then filed a last-minute appeal of the Fourth District Court’s ruling with the California Supreme Court.
After a year-long delay, the Supreme Court reinstated the charges and sent the matter back to the trial court. When the case moved back into the courtroom of Judge Michael Smith in the summer of 2014, the defense launched a full frontal attack on Postmus’s credibility while simultaneously bringing forth a raft of motions for dismissal. While Smith would eventually refuse to grant the lion’s share of those motions, he did grant dismissal on the central conspiracy charge involved in the case lodged against each of the defendants, upon which the primary narrative of the case was hinged, including 43 overt acts.
Defense attorneys, led by Burum’s primary counsel, former federal judge Stephen Larson, sought to derail the case by having that conspiracy element dismissed, based upon statute of limitations grounds. Larson in his court papers asserted that conspiracy charges are subject to a strict three-year statute of limitations rather than the four years alleged by the prosecution, which conversely held that because one of the acts alleged in the conspiracy involved government fraud, the statute for which is four years, the criminal case did not fall outside the statute of limitations. Smith sided with the defense on that question. Smith further dismissed twelve other charges in the case, likewise on statute of limitations grounds based on arguments that the victim, i.e., the county and its officials, knew of or had strong grounds to suspect as early as 2006 that the illegal activity described in the indictment had taken place, thus making the May 2011 indictment too late given the three-year statute of limitations. But Smith gave the prosecution the opportunity to amend the complaint to clarify that both law enforcement officers and county officials had no substantial indication that the alleged crimes had occurred until November 2008. After prosecutors in August 2014 availed themselves of that option by filing an amended indictment with that clarification, those charges were preserved.
In all, Smith left standing 18 of the original 29 charges in the indictment, having also tossed out a set of perjury and tax fraud charges against Erwin, Biane and Kirk relating to the contributions to the political action committees they controlled, ruling such political donations cannot be considered income to the founders of the political action committees or those in control of them. Smith also dismissed conflict-of-interest charges against Burum and Erwin, reasoning that Burum was never a public official and Erwin was not a public official at the time of the alleged crimes.
Nevertheless, the prosecution, highly conscious that the conspiracy charge Smith dismissed against the defendants represented the gravamen of the case, appealed that ruling to the Fourth Appellate Court in September 2014. This week, nearly thirteen months later, a three-judge panel of the appellate court, consisting of justices Art McKinster, Thomas Hollenhorst and Douglas Miller, upheld Smith, ruling in an 18-page unpublished opinion in favor of the arguments put forward by Larson and rejecting the prosecution’s theory that the statute of limitations ran to 48 months rather than 36.
“The Legislature did not intend to apply the extended statute of limitation to conspiracy to commit those offenses or other offenses based on misconduct in office,” the opinion, written by McKinster, states. In addition, the justices propounded, “a statute of limitations must be strictly construed in favor of the accused.”
Shortly after the appellate court’s decision was released, Larson told the Sentinel, “The Court of Appeal affirmed the decision by Judge Michael A. Smith throwing out the conspiracy charges against my client, Mr. Burum, and the rest of the defendants. This obviously impacts on the viability of the prosecution’s case, as the conspiracy count represents the essential element on which the vast majority of the indictment is based. I can’t give you an exact number off hand but if you look at the indictment, a major percentage of the overt acts described are devoted to the conspiracy. That includes almost all of the fallacious accusations that have been made in this case. All that is left against my client is aiding and abetting in the receipt of a bribe and aiding and abetting in the misappropriation of public funds charges, both of which are being subject to challenge at a hearing scheduled for October 30th.”
Larson, who throughout his representation of Burum has confined himself to aggressive lawyering but avoided questioning the honesty or professional integrity of any individual members of the prosecution team, this week departed from his customarily genteel demeanor, speaking in starkly deprecating terms about what he suggested was misconduct in the prosecutor’s office, going so far as to hint at legal reprisals that lay in store for district attorney and state attorney general.
“One of the messages that has come out of this decision is that the appellate court has said that as a matter of law these charges should never have been brought against Mr. Burum,” Larson said. “These charges were filed in violation of the penal code. I hope someone in this county will consider that and the DA will consider dropping this case.”
When asked if he had detected any signs as to whether the prosecution might pursue an appeal on the Fourth Appellate District’s decision to the California Supreme Court as it had previously, Larson said, “The people have a right to appeal this to the Supreme Court. I had no indication from them what their intent is.”
To a pointed question about whether there was a way for the district attorney to “gracefully” opt out of the case after having pursued it with such intensity for so long, Larson intoned, “I don’t think justice requires grace but grace requires that justice be done. When a district attorney realizes that a case is as troubled as this one is, the right thing to do is to dismiss it. These charges should not have been brought in the first place. At a minimum, justice requires that the charges be dismissed at this time.”
Without saying so directly, Larson threatened a radical reversal of legal focus that would entail Burum prosecuting a civil case against not only the county but any members of the district attorney’s office or attorney general’s office who in pursuing the case against him engaged in any deliberate misrepresentations that would void their prosecutorial immunity.
“This nonsense has to end,” Larson said. “The district attorney is spending millions of taxpayer dollars on what is clearly a political vendetta being pursued for purely political reasons. He is causing others to spend millions of dollars and in so doing creating millions of dollars in liability for the county. This has to stop.”
Prosecutors offered no comment.

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