From Justice to Criminality – a Brief History of the California Judiciary

In 1935, the California Supreme Court wrote, "When a scheme is evolved which on its face violates the fundamental rules of honesty and fair dealing, a court . . . is not impotent to frustrate its consummation because the scheme is an original one.” American Philatelic Soc. v. Claibourne (1935) 3 Cal.2d 689, 698. Those quaint days are a distant memory. Today, the California judiciary is infused with a crimogenic spirit, where one might opine that its motto is Corruptio Est Bono.  

How the Courts Make Society Safe for Corruption 

Let’s look at poor Daniel Foley and his 1987 case where the California Supreme Court championed Accounting Control Fraud [AFC]. As CityWatch readers know, AFC occurs when a company’s executives or a city council and its mayor loot the company’s or city’s treasury. Rather than use a gun, they use fraud. 

Reading between the lines of Foley v. Interactive Data Corp., (1988) 47 Cal.3d 654), we see that the executives of Interactive Data wanted to get in on the gravy train of looting their company, but they didn’t know how. Thus, they set out to hire Robert Kuhne, a known embezzler, to help them. The naive Daniel Foley thought hiring an embezzler was not wise. Chase Manhattan Bank owned Interactive Data, and depositors do not like banks that go out of their way to hire embezzlers. After Foley squealed on Kuhne, Interactive Data fired Foley. After Kuhne was convicted of embezzlement, did Interactive Data rehire Foley? No, Foley had to sue Interactive Data for wrongful termination.  According to Chief Justice Lucas, corporate executives who are engaging in criminal activity such as embezzlement have the right to fire honest employees who object. Under Chief Justice Lucas, California came quite a way from the days of American Philatelic. 

In 1992, the illustrious Chief Justice authored another decision, Moncharsh v. Heily & Blase (3 Cal. 4th 1), in which he declared that the courts must enforce arbitration awards that are wrong on their face and work a substantial injustice on the victim. In her dissent Justice Kennard’s gullibility was evident. She thought that “Justice is a special obligation of the judiciary.” She foolishly intoned James Madison: "Justice is the end of government. It is the end of civil society. It ever has been, and ever will be pursued, until it be obtained, or until liberty be lost in the pursuit." (The Federalist, No. 51.) 

In 1996, Chief Justice Lucas retired to become an arbitrator secure in the knowledge that he could make rulings which were obviously wrong and unjust, but for which he could earn about $650 per hour. It’s a pretty sweet deal when you can make a law while being a judge that you may lie, cheat and steal after you leave the bench. Do not think that California had reached its low point. 

How Do Judges Get Paid? 

As attorney Richard I. Fine discovered, one source of judicial pay in Los Angeles was illegal. The state constitution forbid judges from getting supplemental benefits, e.g. salary, bonuses, retirement fund contributions, but that did not stop LA County from coughing up $400 million in extra compensation for LA judges. You might think that these illegal payments were a bad deal financially, until you realize that LA County almost never lost a case. When facing litigation involving hundreds of millions of dollars each year, it’s nice to know that you’re making illegal payments to the judges. 

What happened when these illegal payments were uncovered? Richard I. Fine was jailed for 18 months – without any trial or any criminal charges being brought against him. Next, the state gave the judges retroactive immunity for their years of bribe taking. In retrospect, Foley’s “stitches” were mild.  

No One is Safe 

In January 2015, federal judge Alex Kozinski complained that the California judiciary had a “epidemic of misconduct,” and in 2018, the United States Supreme Court Chief Justice John G. Roberts, Jr. forced Kozinski off the bench without taking a single step to reign in California’s epidemic of judicial corruption. (Judge K. allegedly had shown female staffers some porn on his office computer.) 

Bribery is the flip side of extortion and extortionists have the mentality of, “What have you do for me lately?”    

The Judicial Mortgage Scam 

With the escalating cost of housing in Los Angeles, judges have a lot of equity in their homes. The drawback of taking out a loan against the increased valuation is the need to repay the loan. To paraphrase the judge in the Philatelic Society case, “Don’t underestimate the judicial passion for criminality.” Suppose a business targets a judge for a favorable opinion and the judge wants a new mortgage. Presto, the justice gets second mortgage without the burden of monthly payments. How will anyone be the wiser? Judges’ addresses are confidential. So what if a justice has five homes in Beverly Hills. By George, how will you prove that the judge is not making those payments? 

Oops the Al Capone Trap 

How many judges pay taxes on the mysterious mortgage payments? Al Capone did not pay his income taxes and judges who are getting free mortgages tend not to tell the IRS about their illicit income. Bribes, however, are reportable income. 

Judges fail to consider is that the U.S. mail is non-hackable. Thus, anyone who obtains bank data via the U.S. mail and who distributes it via the U.S. mail is sitting in the catbird seat.   

Judicial Immunity Extends to Corrupt Politicos 

As previously recounted, in December 2016, Judge Richard Fruin repudiated the Philatelic American Society case and now corrupt politicians are above the law. His fancy legal word for the criminal actions of the LA City Council and its members is “non-justiciable.”  

The Trumpian Threat to Corruption? 

What if the public gets the loco idea that neither the GOP nor the Dem crooks should run the government and that a corrupt judicial system is not such a great idea? Do the Democrats really think they can prosecute the crimes of Donald Trump et alia without the prosecutorial zeal spreading like a California wildfire?

(Richard Lee Abrams is a Los Angeles attorney and a CityWatch contributor. He can be reached at: [email protected]. Abrams’ views are his own and do not necessarily reflect the views of CityWatch.) Edited for CityWatch by Linda Abrams.