“These additional fees amount to approximately $25 [million] to $30 million dollars extra over the life of the contract,” former Inglewood Councilman Judy Dunlap wrote in a 2012 complaint she sent to the LA County District Attorney’s public integrity division. “This is unconscionable!” Her complaint was in reference to the Inglewood city council’s approval of a trash contract to Republic Services. In a newly filed lawsuit, city of Maywood residents and the city’s Mayor and Council are alleging fraud by the trash hauler and are seeking to invalidate the contract. 2UrbanGirls has received a copy of both the class action lawsuit filed by the residents and accompanying lawsuit filed by the city council.
Inglewood Mayor James Butts insists the trash deal approved in 2012 was best for residents. He cites his business acumen and college degrees to impress upon voters he was smart enough to pull off such a feat.
How did Maywood residents catch what Republic was doing and not our Mayor who holds both a Bachelor’s and Masters degree?
When asked why the council didn’t go with a lower bidder, out of Waste Management and Athens, Butts disputed that Inglewood would have fared better with Athens. He told L.A. Times:
“I personally did not believe that their bid could be relied upon,” he said. “Further, Consolidated employees were represented by a union paying competitive wages while Athens was not.”
The potentially fraudulent billing by CDS/Republic was discovered when the State Controller’s office audited the city of Maywood’s finances. The state promptly brought in a waste industry consultant to further investigate.
“The massive fraud perpetrated by Consolidated Disposal Services is unconscionable,” said Mayor Ramon Medina. “The recent  forensic audit and investigation uncovered a pattern of deceit and fraud committed on the City and its citizens in a substantial manner and that resulted in millions of dollars in overcharges to the residents and businesses in Maywood. We intend to recover all of the funds illegally extracted by this company from the City and its residents.”
The lawsuits, one a class action filed on behalf of Mayor Ramon Medina and others, allege among other things, fraud, breach of contract, negligent misrepresentation, breach of fiduciary duty, conversion and violation of the municipal codes. The City alleges that CDS misrepresented the bases for its rate increase requests to Maywood and/or misrepresented the mathematical calculations that the company provided as the alleged basis for its rate increase requests.
One such item addressed in the lawsuits include the lack of payment to the City from CDS for the UUT collected. The total loss of UUT monies collected by CDS and not remitted to the City over a period of time is estimated to be $2 million, including interest. The total fraudulent overcharges to Maywood’s citizens and commercial interests by CDS from 2005 was estimated to be an additional $2.2 million. The total economic damage to the City, its residents and businesses was $4.2 million.
The Inglewood city council has unanimously voted for every trash rate increase requested by Consolidated/Republic Services. How much potentially is the Inglewood General Fund owed?
Former Maywood Mayor Sam Pena is now an executive member of the Inglewood Chamber of Commerce.
If Inglewood residents wish to file their own class action lawsuit, related to our city contract, contact the law offices of Pacheco and Neach, P.C. at 714.462.1785.