The city of Mountain View filed suit June 20 against the auditors it had hired to conduct annual audits at Shoreline Amphitheatre, asking for more than $5 million in damages for allegedly working for the venue’s promoters as well, in secret.
The civil suit, filed in San Francisco County Superior Court, has six charges including breach of contract, malpractice, false claims and theft of public funds. It names as defendants Daoro, Zydel & Holland, and several corporate ancestors, including Wilson, McCall & Daoro; Wilson, McCall & Associates; and Creed & Associates, as well as auditor Robert Yoshioka.
According to the lawsuit, concert promoter Bill Graham Presents, now owned by Clear Channel spin-off Live Nation, directed the auditors to exclude the value of barter agreements and deduct fees charged to concertgoers for the company’s charity. City Attorney Michael Martello believes that this began as far back as 1986, when the amphitheater opened. He also believes auditors helped conceal tens of millions in revenues over the ensuing decades.
“We have evidence, back in the late 80’s and early 90’s, that they were taking direction from BGP’s attorneys without telling us,” Martello said.
The auditors have not returned numerous phone calls from the Voice.
The city owns the land underneath the Shoreline amphitheater and helped finance its construction with an $8 million loan in exchange for an agreement from BGP to pay a percentage of its “gross receipts” as rent. Failure to report revenue effectively lowered the lease payments the city received.
The city settled its legal battle with Live Nation in May for $10 million, as well as a $1.8 million flat annual payment and a shortened lease term.
E-mail Jon Wiener at jwiener@mv-voice.com
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