Career prosecutors accuse LA city attorney of dropping cases to help donors

As she runs for re-election, L.A. City Attorney Hydee Feldstein Soto faces turmoil and claims of unethical behavior from career prosecutors in her office who have accused her of favoring political donors in criminal cases and questioned her administrative decisions and demeanor.

The allegations have been laid out in emails and a memo obtained by LAist, as well as a sworn declaration to a court.

In emails to colleagues earlier this year, two supervising prosecutors questioned the city attorney’s directive to drop a price gouging case against a major campaign donor. One claimed it’s part of a pattern by Feldstein Soto.

“This latest instruction now to dismiss an active case fully supported by the evidence showing not just probable cause, but a high likelihood of conviction by a jury at trial is improper and unethical,” wrote Dennis Kong, who leads the unit handling price gouging prosecutions, in a Feb. 3 email to colleagues. “Especially in light of the fact that we have confirmed that the parties involved are campaign donors."

Kong did not respond to requests for comment. Office policy prohibits him and almost all other City Attorney staff from speaking to the media.

In interviews with LAist, Feldstein Soto denied ever allowing money or personal relationships to affect her decisions.

“That’s not how I roll,” she said. Instead, Feldstein Soto said her decisions were based on a policy she put in place to follow the Constitution.

In the memo, sent to higher-ups in the office in December, a different group of supervising prosecutors pushed back on Feldstein Soto’s decision to delete criminal case data that’s more than 10 years old.

Feldstein Soto told LAist deleting the older data was a prudent step to make sure sensitive information from older criminal cases — which is confidential under state law — doesn’t fall into the wrong hands. Her office later said the older data will be kept on a physical backup, with prosecutors' access restricted. It’s unclear whether that’s been followed through on.

While Feldstein Soto has dealt with these criticisms from career staff, a whistleblower retaliation lawsuit from a different, former senior prosecutor — alleging misconduct by Feldstein Soto — has been working its way through the courts.

Among other things, that case — filed by the former chief of the prosecutions branch under Feldstein Soto — alleges the city attorney illegally ordered prosecutors to drop a case in order to help her friend and a major donor. The plaintiff, Michelle McGinnis, alleges she was fired in retaliation for opposing and disclosing unlawful actions by Feldstein Soto. The city attorney and the city’s lawyers in the suit have denied the claims, saying Feldstein Soto disciplined her for legitimate reasons.

A judge has allowed that lawsuit to proceed, finding the city’s evidence “falls far short” of proving Feldstein Soto had legitimate reasons to discipline McGinnis.

From the evidence, the ruling states, “a reasonable trier of fact could conclude plaintiff’s protected activity was a contributing factor in defendant’s adverse employment actions against her.”

L.A. Mayor Karen Bass and six of the 15 L.A. City Council members have endorsed Feldstein Soto in her bid for re-election in June. She lost the endorsement of the main LAPD officers’ union over the handling of a massive data breach that exposed confidential files about officers. The police union and county District Attorney Nathan Hochman are endorsing a challenger.

Feldstein Soto told LAist the pushback from the criminal branch of her office is in response to her efforts to reform the City Attorney’s Office.

“I came into this office under a cloud of corruption. Twenty percent of our City Council [members] were indicted or in jail. Six lawyers in this office were under investigation,” Feldstein Soto said. “I was elected to change the status quo. I’m still doing that. And people who benefited under the old status quo have a different agenda.”

Wildfire price gouging case

In the wake of last year’s devastating wildfires, the City Attorney’s Office has filed four criminal cases alleging price gouging, which makes it illegal to spike prices more than 10% during an emergency.

In February, Feldstein Soto directed prosecutors to drop two of those cases.

Scott Marcus, the city attorney’s criminal branch chief, informed prosecutors about that decision in a Feb. 3 email.

Feldstein Soto, he wrote, was concerned the defendants did not receive cease and desist letters before the charges, did not think there was enough evidence to charge people who manage the company and did not believe the cases were an appropriate use of the office’s “limited resources.”

Marcus wrote that Feldstein Soto agreed with his suggestion to dismiss the cases after they “verify that any victim of illegal price increases received restitution and was made whole.”

Kong, a supervising attorney in the criminal branch, responded via email that the order was “improper and unethical” because the case was strong and one of the defendants had donated to Feldstein Soto’s campaign.

“It is safe to say that a pattern has now emerged of the City Attorney's personal interest in protecting her donors,” Kong wrote. “We cannot have that.”

The case Kong was referring to involves the Paddock Riding Club in Atwater Village. In December, prosecutors at the City Attorney’s Office charged PCAM LLC, which does business as the riding club, and three members of the family that runs the business with “price gouging animal boarding services.”

Publicly available court records do not detail the allegations against the riding club, but the company was accused on social media of more than tripling its normal boarding prices to evacuees of the Eaton Fire. The Paddock Riding Club apologized after online backlash and said it was working to rectify the situation.

The City Attorney’s Office confirmed that one person paid the riding club about $1,900 at the higher rate and was later refunded.

The lead individual defendant’s first and last name, birthdate and address corresponds with Alex Chaves Sr., who stewards the property and lives there, according to the Paddock’s website. When reached for comment, his son — also named Alex Chaves — told LAist that the Paddock is “my dad’s place.” Karen Richardson, a spokesperson for the city attorney, said Feldstein Soto’s office does not know if the father or son is the defendant.

Chaves Sr. and defense attorneys in the case have not responded to requests for comment.

Campaign finance records show Chaves Sr., his wife, son Alex Chaves and daughter-in-law each gave maximum-allowed campaign contributions to Feldstein Soto on the same day in December 2024, totaling $7,200.

Around the time they filed the Paddock case in early December, prosecutors also filed price gouging charges against another horse boarding business — Gibson Ranch in Sunland — and its owner. Feldstein Soto told prosecutors to also drop that case when she ordered the Paddock case dropped.

The Gibson Ranch defendants do not show up as donating to Feldstein Soto in campaign contribution searches.

That case was dismissed this month. Their defense attorney, Greg Yacoubian, said the price gouging law did not apply in the Gibson Ranch case because it compared prices charged by a new owner with those from the previous owner at that location. (The price gouging law is specific to a particular person or business selling, or offering to sell, something for a price that’s over 10% higher than they charged just before a declared emergency.)

The arraignment hearing for the Paddock case has been postponed twice since Feldstein Soto’s early February directive to dismiss it, and is now scheduled for June 18.

“We have not moved to dismiss because the Office is confirming the evidence in the case in accordance with appropriate practice, policies, and procedures,” said a city attorney spokesperson.

Scott Marcus, chief of the city attorney’s criminal branch, at a Feb. 26 court hearing in the Paddock case, where he told the judge the arraignment was being postponed.

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Nick Gerda

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LAist

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Feldstein Soto called claims of favoritism “nonsense,” telling LAist she knew who the Paddock defendants were but not whether they donated to her campaign.

She said she wanted to dismiss the two price gouging cases because prosecutors failed to follow a policy she put in place in 2023 — to only prosecute company leaders for the actions of their business if they were actively involved in committing the act or failed to fix the problem after being put on notice they could face charges.

A spokesperson for Feldstein Soto’s administration said the City Attorney’s Office has sent warning letters to almost all of the roughly 1,100 potential price gouging defendants from the wildfires as a way to achieve “compliance and restitution without having to file criminal or even civil charges.”

The goal of regulatory prosecutions, she said, “is to achieve compliance and to get restitution for the victims.”

In follow-up emails forwarded to colleagues who advise on ethics compliance, Kong and another supervising prosecutor in his unit expressed alarm at Feldstein Soto’s directive. Kong called the Paddock case "righteous" and described an “ethical conundrum.”

“I do not want to place our supervisors, our line deputies, or myself in a position where they will be compromised in any shape or form or worse, an accessory to unethical conduct,” Kong wrote. He also noted the law does not require warning letters before filing price gouging charges.

[Click here to read the emails.]

The McGinnis declaration

In a sworn court declaration last year, McGinnis — the former criminal branch chief ousted by Feldstein Soto — alleged a range of ethics violations by the city attorney.

Among them, McGinnis wrote that Feldstein Soto told prosecutors to dismiss a building safety prosecution where the defense attorney was a friend whose wife was a maximum donor to her campaign. That case — against Zenith Insurance and its then-CEO Kari Lynn Van Gundy — alleged 14 criminal violations of building safety laws, including around fire safety and exit doors. Court records show Feldstein Soto’s office dropped the charges against Van Gundy in January 2024, followed by dropping the case against the company in September 2024.

Campaign finance records corroborate the donation described in the allegations. Defense attorney Ben Reznik’s wife gave a maximum campaign contribution to the city attorney in 2022, per campaign filings. Feldstein Soto said she knows Reznik’s wife through social circles.

The city attorney “simply wanted her donor/friend’s case dismissed,” McGinnis wrote in her court declaration, which was filed as part of her whistleblower retaliation lawsuit.

The city attorney denied friendships or donations have ever had anything to do with her decisions.

“ I've prosecuted tons of cases,” Feldstein Soto said. “I've filed cross complaints against all kinds of people, including donors who have called me up spitting and yelling, OK?”

Reznik told LAist that Feldstein Soto’s recommendation was to dismiss only the charges against the then-CEO — Van Gundy — but not against the company itself. The CEO “had no clue” about the building matters that the case was about, he said.

“There was absolutely no basis to name the individual [CEO] of the company” as a defendant, Reznik said. The case, he said, was about “very minor infractions” regarding building codes like fire doors, some of which he said did not apply to the building in question.

After fixing the issues that were cited and getting clearance from the fire department, the charges against the company were dismissed, Reznik said.

In another case, McGinnis wrote, Feldstein Soto pressed hard — “without evidence” — to McGinnis and LAPD leaders for charges to be filed against an activist she thought had protested outside the home of another major donor. In that case, McGinnis wrote that LAPD commanders demanded a meeting with city attorney managers to object to Feldstein Soto’s pressure. The city attorney says she later declined to file charges.

Feldstein Soto’s office says that allegation has “no truth.” As for the alleged meeting with LAPD leadership, her spokesperson said: “We have no knowledge of how the meeting came about and what happened at the meeting.”

“In no uncertain terms, the City Attorney did not and would not pressure a client on any issue,” added the spokesperson. (In addition to overseeing the city’s prosecutors, the city attorney is the top lawyer representing and advising city officials about their official duties.)

Following the judge’s ruling that the city’s evidence “falls far short” of proving Feldstein Soto disciplined McGinnis for legitimate reasons, the lawsuit is scheduled to go to trial in early 2027.

Data deletion memo

In December, three senior prosecutors in the City Attorney’s Office wrote a memo objecting to what they described as a plan to “purge all data” older than 10 years from the office’s text-only database of criminal case details, known as the Criminal Case Management System, or CCMS, as it migrates to a new system.

City attorney policy has been to destroy physical paper records of criminal cases, while the database of case information has been kept for decades, except for specific types of cases where deletion is required by law.

The memo was from three supervising prosecutors: Stacey Anthony, who directly supervises about three dozen criminal prosecutors, and two of her deputies.

They warned that deleting the data would harm victims and defendants because it’s often the only remaining source of crucial information.

“In many instances it would result in a miscarriage of justice,” states the Dec. 12 memo, a copy of which was obtained by LAist.

They wrote that the older data is used daily for a variety of crucial tasks — including strengthening rape and murder cases, evaluating the history of criminal defendants, generating letters for employment and immigration purposes that no charges were filed against an arrested person, and vetting criminal histories for police officers and others seeking licenses, credentials and firearm permits.

The supervising prosecutors wrote that it’s crucial that the older information be made readily accessible to prosecutors on a daily basis. The info is used for up to 50 requests per day to their part of the criminal branch alone, according to the memo.

[Click here to read the memo.]

Feldstein Soto and her office spokesperson initially confirmed the plan to delete the data altogether.

“I wanted to purge everything older than three years…but 10 years seems to be the consensus for how long we need to keep anything,” Feldstein Soto told LAist in December.

Feldstein Soto said deleting the data was a prudent step to make sure information doesn’t fall into the wrong hands. Her office said it does not have any evidence the database has been misused.

She said she’s looked in the database just once, looking up herself and seeing information about an old DUI case against her, which she pleaded to reckless driving.

“This came up in my last campaign. It was all over the place,” said Feldstein Soto.

During her 2022 campaign, information about her 1997 DUI case was posted on social media by an advocacy group. The post shows a public printout from the court summarizing the charges, without the kinds of detailed info that would be in the office database.

In January, a spokesperson for Feldstein Soto’s office said the plan is to keep the older case data on an encrypted hard drive that will be more restrictive for prosecutors to access. She and her spokespeople have not answered questions in recent weeks about whether case data has already been deleted, nor whether they’ve developed the specific policies for prosecutors’ access.

Feldstein Soto told LAist she had to learn quickly about criminal law after being elected in late 2022 as the top elected boss above the city’s prosecutors.

“You realize, I had no criminal [law] background. So this was all learning on the job,” she said. Her experience before being elected was in bankruptcy and corporate law.

“It was baptism by fire,” she said, “to start in this office without a criminal background.”