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Irwindale Again Sues Development Specialist

May 04, 1989|EDMUND NEWTON | Times Staff Writer

IRWINDALE — Despite some conciliatory talk by city officials last week, the city has filed another lawsuit against Fred Lyte, its former redevelopment consultant.

In papers filed in Pomona Superior Court, the city contends that Lyte "fraudulently (concealed) material facts about a development project . . . which otherwise would have been rejected" in order to collect an extra fee under his contract.

The suit also charged Lyte with trying to disrupt the city's negotiations with the Los Angeles Raiders to build a $150 million football stadium in Irwindale by spreading rumors and making false charges.

Lyte, part of the negotiating team that produced the initial accord with the Raiders, characterized the suit this week as "pure baloney, tailored to harass me."

City Blocks Payments

Since the City Council dismissed the consultant last December, the city has widely accused him of creating discord in the city and blocked the payment of more than $1 million in bills he has submitted to Irwindale. The city has also filed a lawsuit seeking more than $2 million in damages, claiming that Lyte had violated a provision in his contract forbidding him to recommend to the city projects in which he had a financial interest.

In a bitter exchange with city officials last month, Lyte charged the first suit "will be laughed out of court" because he was never a city employee. The laws that define conflicts of interest may not apply to him, he suggested.

Lyte, who has called for an investigation of Mayor Patricio Miranda by the Los Angeles County district attorney, charged that, since Miranda became the mayor last year, the city has been "turned over to" a group of lawyers and consultants who are concerned only about personal gain.

Charles Martin, who serves as city manager and city attorney, suggested at last week's City Council meeting that the city would be willing to reach an out-of-court settlement with Lyte, if the fired consultant would be "reasonable" in his dealings with the city.

The new legal action centers on the creation of a strip mall two years ago at the intersection of Irwindale Avenue and Arrow Highway, a block from City Hall.

According to the complaint against Lyte, the Hopkins Development Co. had agreed to build a shopping center on a two-acre lot on Arrow Highway, but only if an adjacent 7,000-square-foot lot at the southeast corner of the busy intersection could be included in the package.

The smaller lot, with a 50-foot frontage on Irwindale Avenue, is owned by Miranda.

According to the complaint against Lyte, Miranda had refused to lease the property to Hopkins because his constituents would perceive such an arrangement by a city official as a conflict of interest. Following the advice of Martin, Miranda "would not lease or sell his land to any party who would be involved in the shopping center development," the complaint says.

But principals of Hopkins, the development company, three years ago formed a general partnership, and negotiated a lease with Miranda. The complaint says Miranda did not know that he was dealing with a Hopkins subsidiary, and Lyte withheld that information to collect a 3% fee for bringing a new development to the city.

Restaurant Property

Miranda's property, once the site of Miranda's taco stand, called Pudgy's, now holds a Jack-in-the-Box outlet that shares a parking lot with a 10-store strip mall.

"The city did not discover the true facts relating to Lyte's fraudulent concealment of information or breach of fiduciary duty until April, 1989," the complaint says.

Lyte, who has accused Miranda of jeopardizing the Raiders deal and causing "a virtual halt in the (Irwindale) industrial development program," scoffed at the charges.

He said that he has seen copies of correspondence between Miranda and Hopkins in early 1987, discussing the mayor's lease with Irwindale Associates. "They're using city money to try to run me out of business, and that just isn't going to work," Lyte said.

The Pudgy's property has also become an issue in a recall campaign initiated by some Irwindale residents against Miranda and Councilman Salvador Hernandez. According to a petition drawn up by resident Brenda Marin, Miranda tried to "extort additional rent for the Pudgy's property through use of governmental pressure."

Miranda did not respond to telephone messages. Marin would not comment on her recall petition.

Times staff writer Ken Reich contributed to this story.

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