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DA to EIDC: No public funds for lawyers

Corp. says spending helps prevent runaway prod'n

Los Angeles County’s top prosecutor has warned the troubled Entertainment Industry Development Corp. against using public funds to defend itself in his criminal investigation.

In a letter to the EIDC board, DA Steve Cooley noted the film-permitting agency has retained defense attorneys, even though agencies using public funds must first formally determine that the employees acted “in the best interest of the public entity.”

The board has not met since Cooley’s investigators raided EIDC offices Sept. 4 amid allegations of misuse of public funds through lavish spending and political donations. “I am confident you will carefully consider your fiduciary obligation to ensure that public funds are being used consistent with the requirements,” Cooley added.

EIDC attorney George Newhouse disputed Cooley’s contentions, insisting the EIDC is a private entity. “He is trying to chill the right of the board to indemnify its employees down the road,” he added.

No charges have been filed in the probe, which alleges misuse of $500,000 spent by EIDC chief Cody Cluff and $200,000 in donations to politicians, including many sitting on the EIDC board. The EIDC has been unapologetic, arguing that its spending helps combat runaway film production.

The EIDC even defended $10,000 in contributions to the Pittsburgh Film Office, arguing the funds were needed to keep Pittsburgh office director Dawn Keezer employed and heading the Film U.S. alliance of commissioners, which works on efforts to halt runaway production. “If the office were closed, it undermines the relevance of the organization,” asserted EIDC VP Morrie Goldman.

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