City wins big in Shoreline ruling City wins big in Shoreline ruling (December 30, 2005)

By Jon Wiener

Clear Channel has failed in its efforts to limit the city of Mountain View's lawsuit against the media giant.

Judge William Elfving ruled late Tuesday that the company will have to defend itself against charges that it conspired to steal public funds through accounting fraud at Shoreline Amphitheatre.

"The ruling is basically consistent with out complaint," said city attorney Michael Martello. "There is enough here to go to trial."

The two sides in the lawsuit filed motions for summary judgment in early November, seeking to knock out many of their opponents' claims. Elfving ruled that the city's most damning charges -- racketeering, theft of public funds and false claims -- had enough validity to proceed to trial. At the same time, Elfving reduced the company's claims against the city to two, down from seven when the suit was filed in 2001.

Keith Fong, an attorney for Clear Channel subsidiary Bill Graham Presents, declined to comment on the ruling Wednesday morning, saying he had not yet seen a copy of it. But, at a Dec. 15 hearing on the motions, his law partner James Wagstaffe belittled the city's charges as "silly" and argued that the city was inventing a conspiracy tale to squeeze more money out of its amphitheater.

The company could face stiff penalties in the case. Racketeering and theft of public funds carry triple damages, while the theft of public funds charge could expose the company to punitive damages.

A city-sponsored audit released in late August detailed the tactics the company allegedly used to conceal more than $20 million in revenue over a six-year period at the amphitheater. Company lawyers disputed the audit's findings without ever explaining why. Now, the trial will force the company to open its books to the public even further.

"A lot of the positions they've taken are going to come back to haunt them," said Martello.

Elfving did rule in the company's favor on a few counts, allowing it proceed with a claim that parking fees assessed to all ticketholders are exempt under the lease.

The discovery phase of the lawsuit will end Jan. 6, with the trial scheduled to begin a month later.

E-mail Jon Wiener at jwiener@mv-voice.com

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