Filed 9/11/26 P. v. Moland CA5
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
FIFTH APPELLATE DISTRICT
THE PEOPLE,
F089826
Plaintiff and Appellant,
(Super. Ct. No. BF191728A)
v.
PALMER CORNELIOUS MOLAND, OPINION
Defendant and Respondent.
THE COURT*
APPEAL from a judgment of the Superior Court of Kern County. Andrew
Kendall, Judge.
Cynthia J. Zimmer, District Attorney, Anthony Yim, Deputy District Attorney, for
Plaintiff and Appellant.
Laura Arnold, under appointment by the Court of Appeal, for Defendant and
Respondent.
-ooOoo-
* Before Hill, P. J., Meehan, J. and DeSantos, J.
SEE CONCURRING AND DISSENTING OPINION
INTRODUCTION
The magistrate held defendant Palmer Cornelious Moland to answer for
misappropriating public monies and making a contract in which he had a financial
interest as a member of a school district. An information was later filed, containing both
charges. The trial court granted defendant’s motion to set aside those charges. The
People appeal. We conclude that sufficient evidence was presented at the preliminary
hearing to hold defendant to answer. We shall reverse the order and direct the trial court
to deny defendant’s motion.
PROCEDURAL HISTORY
The District Attorney of Kern County filed a complaint on September 7, 2022,
charging defendant with misappropriating public monies (Pen. Code, § 424, subd. (a)(1);1
count 1), making a contract in which he had a financial interest as a member of a school
district (Gov. Code, § 1090;2 count 2), filing a false nomination paper or declaration for
candidacy (Elec. Code, § 18203; counts 3, 4), registering to vote when ineligible (Elec.
Code, § 18100, subd. (a); count 5), and voting by an ineligible person (Elec. Code,
§ 18560, subd. (a); counts 6, 7).
The magistrate found sufficient cause to believe defendant committed the offenses
alleged in the information at the preliminary hearing.3 Thereafter, the district attorney
filed an information that realleged the charges contained in the complaint and charged
three additional counts of perjury (§ 118; counts 8–10). Defendant filed a motion to set
1 Undesignated statutory references are to the Penal Code.
2 It is a felony to knowingly and willfully violate Government Code section 1090.
(See Gov. Code, § 1097.)
3 The magistrate concluded that sufficient evidence demonstrates Fairfax Elementary
School District (District) paid over $11,000 in legal fees incurred for defendant’s advantage and
own private concerns.
2.
aside counts 1 and 2 of the information pursuant to section 995 on May 6, 2025. The trial
court granted the motion on May 8, 2025.
The People filed a timely notice of appeal on May 15, 2025.
FACTS
I. Preliminary Hearing Evidence.
Defendant took office as a member/trustee of the Board of Trustees (Board) of the
District in December 2018. He was elected Board president at a special meeting on
December 15, 2020. At a general meeting on the same day, the agenda included a vote on
Proposed Resolution No. 2021-08 (proposed resolution), a public censure of defendant
based on an investigation into August 2020 complaints made by District employees and
the union president that described inappropriate, harassing, and abusive conduct by
defendant. The investigation yielded a 120-page report.
The proposed resolution described the investigation’s conclusions that defendant
engaged in abusive or bullying conduct toward District employees in violation of District
policy and Board bylaws, including: (1) approaching District office staff in a demanding
and aggressive manner in violation of protocols, scrutinizing their work, and creating
extra work for them; (2) demanding and unprofessional requests to District staff, rather
than to the superintendent, that intimidated staff and disrupted legitimate District
business; (3) inappropriately criticizing work performance of a District employee who
had criticized defendant to another employee; (4) usurping the responsibilities of the
superintendent regarding employee facemasks by making derogatory remarks in public
that misconstrued Board action and superintendent directives; (5) failing to refer
correspondence regarding employee performance to the superintendent and reading it
during public comment; and (6) performing management of administrative functions
motivated by self-interest to discredit the superintendent. Defendant also engaged in
abusive behavior toward the union vice president by falsely posting on social media that
the vice president had engaged in illegal political activity. Additionally, during the
3.
investigation, defendant provided untruthful responses to the investigator’s questions,
including the length of his prior employment with the District.
The proposed resolution sought a vote from the Board to (1) formally disapprove
and censure defendant’s conduct, (2) direct defendant to review and comply with Board
policies, regulations and bylaws, and to follow school site protocols; (3) instruct
defendant to provide a safe, welcoming, and positive work environment for students and
employees in accordance with the District’s mission; (4) direct defendant not to usurp the
superintendent’s duties, exercise administration responsibility, or make demands or
requests of District employees; (5) direct defendant to follow Board protocols when
visiting school sites or facilities; (6) remove defendant from any committee or leadership
position until he completes effective governance and school laws and regulations training
and suspend him from representing the District or Board at public functions;
(7) reevaluate defendant’s conduct at a public meeting following successful completion
of the recommended training program; (8) recommend defendant resign from the Board;
and (9) recommend defendant seek assistance from an executive or leadership
development coach at his own expense. The proposed resolution also notified defendant
that any future noncompliance with the Board’s bylaws, policies, regulations, or
directives would result in the Board refusing to indemnify him for claims or actions
resulting from his conduct to the extent allowed by law.
Defendant recused himself from the vote, and the proposed resolution failed
(despite public comment encouraging the Board to follow the censure recommendation)
when the vote of the remaining four Board trustees tied.
Before the Board met again on January 14, 2021, a local news media submitted a
California Public Records Act (PRA) (Gov. Code, § 6250 et seq.) request seeking the
motion to censure, other documents relating to the investigation that led to the motion,
and defendant’s employee records.
4.
Bylaw 9124 of the District’s Board Policy Manual empowers the Board to contract
with county counsel or attorneys in private practice who may render the Board or
superintendent legal advice, serve in the preparation and conduct of District litigation,
render advice on school bond and tax increase measures, or perform other duties as
assigned by the Board or superintendent. When seeking legal advice, the superintendent
is required to initiate a “Request for Proposals” (RFP) to advertise and solicit proposals
for legal services. The Board may contract for temporary, specialized legal services
without initiating an RFP when a majority of the Board determines that “the unique
demands of a particular issue or emergency situation so requires.” As Board president,
defendant could only confer with District legal counsel subject to Board parameters and
only when so directed by a majority of the Board.
On January 8, 2021, a representative of the law firm Fagen Friedman & Fulfrost
LLP (F3) e-mailed defendant an agreement for legal services “[i]n response to a recent
conversation” with one of F3’s attorneys. Superintendent Michael Coleman told the
investigator that he learned defendant intended to contract with F3 from this e-mail and
knew nothing about the matter previously. The e-mail was carbon copied to
Superintendent Coleman, who e-mailed defendant in response as follows: “I’m assuming
you have let this firm know we are publishing an RFP[.] [¶] Please be careful not to
engage to[o] much with any firm as it can be viewed as giving a particular firm an unfair
advantage. [¶] The[y] will have to respond to the formal RFP when published.”
Defendant replied the following day: “I spoke to you earlier and [F3] is aware. Please
place this Firm on the agenda as a voting item. The Board can give the decision on how
to act. A special situation has occurred whereas, we must vote on a specialized
experienced Firm on the January 2021 agenda.” Superintendent Coleman later told a
district attorney investigator that defendant claimed he “just picked [F3] out of the phone
book.”
5.
Superintendent Coleman e-mailed defendant on January 11, 2021: “I am sending
to you the DRAFT version of the RFP. [¶] Please review it. As mentioned, we need to
discuss the evaluation process of the current firm ([Schools Legal Service]) and decide if
we are going to publish this or not. [¶] I am only sharing this with you at the moment
until we discuss the path forward.” Schools Legal Service was the law firm serving the
District at that time.
The Board met on January 14, 2021, and voted on whether to add a motion to
reconsider defendant’s censure to the agenda for the next Board meeting. Defendant
abstained from voting, but during public comment, he requested that he be given time to
attempt to resolve personal issues with the superintendent. Placing the matter on the
agenda failed when the vote was tied, despite public comments supporting the motion to
reconsider defendant’s censure.
When the Board met on January 14, 2021, it also discussed hiring F3. The
meeting minutes do not identify the reason that necessitated the contract with F3. Trustee
Victoria Coronel later told the investigator that during the closed session of the Board
meeting, an attorney from F3 discussed defendant’s personal matters involving the
censure proposal and his personal liability for matters involved in the censure, which she
did not believe involved the Board. Trustees Coronel and Virginia Lawson also told the
investigator that they did not believe it was necessary to retain counsel, objected to the
failure to comply with the bylaws, and believed that defendant should have recused
himself from the vote because he was the target of the proposal for censure.
Bylaw 9270 of the District’s Board Policy Manual describes the conflict of interest
policy applicable to Board trustees. In pertinent part, the policy provides that Board
trustees may not be financially interested in any contract made by the Board or in any
contract they make in their capacity as Board trustees. Any Board trustee with a financial
interest in a contract shall be disqualified from voting. The Board voted to contract with
6.
F3, and defendant cast one of the three votes in favor even though there had been no RFP
pursuant to the bylaw.4
The prosecution presented evidence that, on January 15, 2021, an F3 attorney
requested a staff member to provide a videoconference link to defendant and another
trustee for a conference call scheduled for January 18, 2021. The staff member supplied
the link the following day. On January 19, 2021, the day after the scheduled conference
call, a fiscal representative of the District e-mailed a digitally-signed copy of the
agreement for legal services with F3 and carbon copied Superintendent Coleman.
An F3 attorney also e-mailed Superintendent Coleman on January 19, 2021, and
thanked Coleman for the Board’s support in “approv[ing] a contract with F3 at its last
meeting.” The attorney also described the January 18, 2021 conversation with defendant
and the other trustee as “focused on the Board’s recent consideration of the censure
motion, trying to resolve and move forward from the censure motion, including steps that
may improve current Board relationships, both among Board members, themselves, and
senior staff and employees. The two Board members expressed an interest in having the
Board consider holding a Board workshop focusing on relationships, Board member roles
and responsibilities, and parliamentary procedures. We are hopeful that we can assist the
Board in this important endeavor.”
The attorney e-mailed Superintendent Coleman again on January 22, 2021, with a
carbon copy to defendant, and requested copies of any PRA requests relating to the
censure motion, any responses by the District, the investigative report of complaints
against defendant, Board minutes from meetings where the Board considered releasing
the report, and any action to waive attorney-client privilege. The attorney explained, “I
4 Although the investigator testified that he believed the January 14, 2021 vote was to
“consider” a contract with F3, other facts indicate that the vote approved the F3 contract,
including a January 19, 2021 e-mail forwarding a digitally-signed agreement from the District’s
fiscal representative to F3 and a January 19, 2021 e-mail from an F3 attorney thanking the Board
for having approved the legal contract with F3, as described post.
7.
believe you indicated that the Board took action to permit the release of the report in
response to the PRA request,” and “I am trying to figure out exactly what action the
Board took with regard to releasing the report.”
Superintendent Coleman e-mailed the F3 attorney on January 29, 2021, advised
that he spoke with defendant about the need to clarify the F3 contract as it relates to the
scope of services being provided by F3, and asked if the attorney would forward a revised
contract. In response, the attorney asked if there was a special Board meeting that night
and advised the contract previously approved would provide the necessary authority for
legal services, and the Board could approve any additional special circumstances to
authorize additional services. Coleman replied that no meeting was scheduled and after
speaking with defendant, Coleman understood the contract would remain the same, but
the Board could approve and specify the scope of the services. The attorney confirmed
and asked when the special meeting would be scheduled.
The special Board meeting was held on February 3, 2021. Superintendent
Coleman told the investigator that defendant requested the February 3, 2021 meeting.
Coleman stated that he did not understand why F3’s legal services were necessary. The
special meeting agenda item for the legal contract with F3 describes, “Approve contract
for specialized legal services with the education law firm of [F3] due to unique demands
of a particular issue and urgent related timing restrictions.” At the meeting, Coleman
reminded defendant that no RFP had been issued to permit other law firms to compete for
the legal contract. The minutes of the meeting provide that the Board was to consider
approving the contract with F3 because the unique demands of the issue or situation
required it and describes the purpose of the legal contract as “assistance regarding the
unique censure motion, and related issues, including by not limited to the 2020
investigation and PRA requests for the same.” Coleman told the investigator that two
Board trustees asked defendant to identify the emergency that would excuse an RFP, but
defendant failed to do so.
8.
Trustee Coronel told the investigator that she did not know why it was necessary
to contract with F3 and the Board never declared an emergency. During Board meetings
where the contract was discussed (including the Feb. 3, 2021 meeting), she asked several
times for an explanation as to why the F3 contract was necessary and why proper
procedures were not followed (referring to the RFP requirement). Coronel also advised
the investigator that an F3 attorney was present during the January 14, 2021 closed
session meeting and she heard the attorney providing defendant and another trustee with
personal legal advice that did not relate to District business, including issues of personal
civil liability. Coronel told defendant that he should not vote on the legal contract
because it posed a conflict of interest in that the contract appeared related to defendant’s
personal interests and not District business.
One member of the public objected to defendant voting on the issue because
defendant was the subject of the censure, which is a conflict of interest. Several members
of the community called for the Board to reject the proposal to contract with F3 because
it appeared designed to provide personal counsel to defendant and for defendant to recuse
himself from the vote due to the conflict of interest.
Trustee Lawson told the investigator that during the February 3, 2021 meeting, the
Board “was caught completely off guard and that they did not understand why this firm
was being hired.” During the meeting, Lawson advised defendant that the Board had not
declared an emergency to justify bypassing the RFP process and the contract was illegal.
Defendant did not advise what emergency excused the RFP process and only stated that
he had already talked to the lawyers and the contract was going forward. Lawson also
expressed her belief that defendant’s participation in the vote was a conflict of interest
because the F3 contract appeared to be related to defendant’s personal issues and not
District issues.
9.
Schools Legal Service was then serving as the District’s counsel.5 Grant Herndon
was the Schools Legal Service attorney who attended the February 3, 2021 meeting to
provide legal advice regarding the F3 contract. During the meeting, Herndon advised the
Board that it could hire a law firm but needed to either use the RFP process or the Board
would need to vote and agree on a declared emergency to bypass that process. The Board
did not vote on any circumstances that created an emergency to justify bypassing the RFP
process.
The Board voted to contract with F3, and defendant cast one of the three votes in
favor.
The District paid F3 $3,230 for legal services through January 31, 2021, from an
invoice dated February 23, 2021, and $8,672 for legal services through February 28,
2021, from an invoice dated March 22, 2021. These invoices describe the legal services
provided by F3 and were related to defendant’s censure motion and the PRA request. For
example, the description of work in the February 23, 2021 invoice included a January 18,
2021 “[t]eleconference with Board leadership regarding background facts, Board censure
action and consideration; discuss Board options”; a January 21, 2021 teleconference
regarding the censure motion and release of report; reviewing and forwarding e-mails to
Schools Legal Service regarding a response to the PRA on January 25, 2021;
conferencing with District counsel; analyzing issues involving the Board’s retention of
counsel; and a January 27, 2021 teleconference with defendant and another trustee
“regarding investigation, censure, and related PRA requests and initial strategy regarding
same and contracting with firm to assist on this specific issue.” The March 22, 2021
invoice concerned the preparation of a revised contract for legal services, closed session
issues, analysis of the District’s failure to notify a former employee of the release of
5 Schools Legal Service and F3 both provided legal services and representation to school
boards and districts.
10.
personnel file information in response to the PRA request,6 and review of the redacted
report and exhibits prior to disclosure.7
Superintendent Coleman told the investigator that F3 was performing legal work
regarding the censure motion and the PRA request, which benefited defendant regarding
his own personal issues. After reviewing the F3 invoices, Trustee Coronel concluded that
the legal work related to defendant’s issues regarding the censure motion and the PRA
request.
II. Section 995 ruling.
During argument, the trial court expressed its that view that the evidence was not
sufficient to establish count 1, because defendant did not “take any money at all.”
Regarding count 2, the trial court commented, “I don’t see how it is a conflict of interest.
[F3] was retained by the [B]oard. Yes, they didn’t follow the RFP procedure, but I [am]
not sure that’s a felony. [F3] represented the [B]oard. They didn’t represent him.” The
trial court stated that defendant did not have a financial interest in F3, and it could not
understand how defendant would have benefited by hiring F3. Concluding that the
evidence showed F3 had been acting on behalf of the Board and not defendant, the court
found that defendant did not derive a financial benefit from the F3 legal contract or F3’s
work. The court concluded that the mere fact that defendant was the subject of the
censure or that he did not wait for the RFP process before contacting F3 did not prove
that F3 was working for his personal benefit or that he misappropriated public funds.
6 Defendant previously worked for the District, and the PRA requested his employment
records.
7 The prosecutor also introduced evidence that, if the censure passed and defendant was
removed from the Board, he would lose approximately $21,962.40 in medical benefits provided
to him as a Board trustee and would be required to expend money for personal leadership
training.
11.
DISCUSSION
I. Sufficient evidence presented at the preliminary hearing supports the offenses
charged in counts 1 and 2.
The People argue that the evidence presented at the preliminary hearing
establishes facts sufficient to hold defendant to answer to the charges of misappropriating
public monies and making a contract in which he had a financial interest as a member of
a school district, and the trial court erred in granting defendant’s motion to set them aside.
We agree.
A. Standard of Review
A court properly sets aside all or part of an information upon finding that “the
defendant had been committed without reasonable or probable cause.” (§ 995,
subd. (a)(2)(B).) “ ‘ “ ‘Reasonable or probable cause’ means such a state of facts as
would lead a [person] of ordinary caution or prudence to believe, and conscientiously
entertain a strong suspicion of the guilt of the accused.” ’ ” (People v. Mower (2002)
28 Cal.4th 457, 473.)
“To establish probable cause sufficient to overcome a section 995 motion, ‘the
People must make some showing as to the existence of each element of the charged
offense.’ [Citation.] ‘Evidence that will justify a prosecution need not be sufficient to
support a conviction.’ ” (People v. Scully (2021) 11 Cal.5th 542, 582.) An “information
should be set aside only when there is a total absence of evidence to support a necessary
element of the offense charged.” (People v. Superior Court (Jurado) (1992)
4 Cal.App.4th 1217, 1226.) “ ‘We will not set aside an information “if there is some
rational ground for assuming the possibility that an offense has been committed and the
accused is guilty of it.” ’ ” (Scully, at p. 582.)
“ ‘On review … the appellate court in effect disregards the ruling of the superior
court and directly reviews the determination of the magistrate .…’ ” (People v. Gonzalez
(2017) 2 Cal.5th 1138, 1141.) Insofar as the motion “rests on consideration of the
12.
evidence adduced, we must draw all reasonable inferences in favor of the information
[citations] and decide whether there is probable cause to hold the defendant[] to
answer.’ ” (Lexin v. Superior Court (2010) 47 Cal.4th 1050, 1072 (Lexin).)
“[A]lthough there must be some showing as to the existence of each element of the
charged crime [citation] such a showing may be made by means of circumstantial
evidence supportive of reasonable inferences on the part of the magistrate.” (Williams v.
Superior Court (1969) 71 Cal.2d 1144, 1148.) “However, … an information will not be
set aside merely because each element of the charged crime is not established by direct
testimony. Rather, the inquiry is whether the evidence … discloses circumstances from
which the magistrate might reasonably have inferred the existence of each element of the
charged crime.” (Id. at pp. 1148–1149.)
“A reviewing court may not substitute its judgment as to the weight of the
evidence for that of the magistrate, and, if there is some evidence to support the
information, the court will not inquire into its sufficiency.” (Rideout v. Superior Court
(1967) 67 Cal.2d 471, 474.)
B. Misappropriation of Public Monies
1) Applicable Law
Section 424, subdivision (a)(1), (7) provides: “Each officer of … any … district
… and every other person charged with the receipt, safekeeping, transfer, or disbursement
of public moneys, who … [¶] … [w]ithout authority of law, appropriates the same, or any
portion thereof, to [their] own use, or to the use of another … [¶] … [¶] … [i]s punishable
by imprisonment in the state prison for two, three, or four years, and is disqualified from
holding any office in this state.” “[T]o be found guilty under section 424[,
subdivision (a)(1)], a defendant must act without lawful authority; must know or be
criminally negligent in failing to know that [they] lack[] legal authority; must act with
respect to public moneys; and must take sufficiently affirmative action with respect to
13.
those moneys that [they] can be said to have ‘appropriate[d]’ them.” (People v. Hubbard
(2016) 63 Cal.4th 378, 397, sixth bracketed insertion in original.)
“Section 424[, subdivision (a)(1)] makes criminal the appropriation of public
funds to oneself or another without authority of law.” (Stark v. Superior Court (2011)
52 Cal.4th 368, 395 (Stark).) “The ‘law’ applicable to the acts and omissions in these
provisions of section 424 is the authorizing law, which is extraneous to the penal statute.
Liability under section 424 arises when the officer or custodian, bound by these
authorizing laws, acts without authority (§ 424[, subd. (a)(1)]) …. [Citation.] For the
sake of clarity, we will refer to these authorizing laws as ‘nonpenal laws,’ to distinguish
them from the crimes defined in section 424. In Stark’s circumstances, for example, the
nonpenal law relied on by the People includes the Government Code and the [b]oard
resolutions.” (Id. at p. 397, fn. omitted.)
The presence or absence of legal authorization is an essential element of the
offense and a “ ‘fact’ ” about which the defendant must have knowledge in order to act
with wrongful intent. (Stark, supra, 52 Cal.4th at pp. 397–398.) “Thus, the People must
prove, as a matter of fact, both that legal authority was present or absent, and that the
defendant knew of its presence or absence”8 (id. at p. 398) or was criminally negligent in
failing to know the legal requirements underlying the section 424 charge (id. at p. 399).
“As with any mental state, the People may prove this knowledge by reference to the facts
and circumstances of the case.” (Id. p. 398.)
2) Analysis
The facts presented by the prosecutor demonstrate that defendant’s actions and
activities were irregular and outside the usual procedures of the District. The question is,
based upon a review of the evidence presented at the preliminary hearing, whether there
8 It is sufficient if defendant knew generally that a nonpenal law required or prohibited his
conduct. (Stark, supra, 52 Cal.4th at p. 398.)
14.
was some rational ground for the magistrate to assume not only that some violation of
law had occurred, but that a violation of section 424, subdivision (a)(1) had occurred and
defendant committed the violation.
This is obviously not the typical case of a violation of section 424,
subdivision (a)(1), a section more often used in situations where a public employee or
official, in the course and scope of their employment, receives money and converts the
money to their own use rather than turning it over to the public entity (see People v. Best
(1959) 172 Cal.App.2d 692, 694 [bail money accepted by police officer who never turned
money over to city]) or where the employee in their official capacity, having access to
public moneys and having the authority to disburse the public moneys for certain
purposes, embezzles the money to their own purpose (see People v. Little (1940)
41 Cal.App.2d 797, 798 [city employee having access to city funds embezzled them]).
The charges against defendant do not involve acts that fit either of the typical
scenarios. Here, defendant is alleged to have used his position as president of the Board,
and the trust and respect accompanying that position, to enter into a legal contract with a
law firm he had solicited and with whom he was communicating to obtain legal advice,
purportedly on behalf of the Board, but would further his personal goals of minimizing
the risk of censure, avoiding personal liability, and minimizing disclosure of the negative
investigative facts underlying the censure resolution, with the District paying the
expense.
Bylaw 9124 empowers the Board to contract with attorneys for legal advice or to
prepare and conduct District litigation or other duties as assigned by the Board or
superintendent, but as the Board president, defendant was limited by Board parameters in
conferring with District counsel and needed authorization of the majority of the Board.
When defendant communicated with F3 on January 8, 2021, defendant did not have
authorization of the majority of the Board to seek outside counsel or to negotiate a
contract for legal services. Even though the Board voted in favor of the contract on
15.
January 14, 2021, the contract was not legally authorized because it had neither been the
result of the RFP process nor subsequent to a finding of emergency to dispense with the
RFP process. The evidence also shows that further voting related to the F3 contract on
February 3, 2021, was insufficient to bypass the RFP process because the Board was not
asked to specify and vote as to the nature of the emergency that would otherwise excuse
it.
According to the censure resolution, defendant admitted that he completed a five-
day training on Board policies and administrative regulations, which would have included
the Board’s authority regarding legal contracts. Considering the training, the e-mail
correspondence relating to the legal contract, as well as the comments of the public and
other Board trustees concerning the legal contract, defendant would have known the F3
contract was unlawful, or he was criminally negligent in not knowing.
Board records do not indicate the legal issues to be addressed by F3, but evidence
supports that the contract would benefit defendant personally. The attempt to contract
with F3 coincided with a media request for the investigative report supporting
defendant’s censure and his employment records. Defendant had defeated the censure
resolution in December 2020, but release of the investigative report would provide details
of the allegations and could cause him embarrassment or renewed attempts to remove
him from the Board. Given that the Board had previously contracted with an independent
attorney to conduct the censure investigation, the Board had access to the independent
attorney regarding any advice needed for the censure resolution. School Legal Services
served as the District’s general counsel, which would typically include any PRA requests.
The magistrate could reasonably infer that the F3 contract was to address the media
request for records and limit disclosure of information detrimental to defendant because
evidence shows that defendant acted outside the rules in seeking F3’s legal services, legal
counsel was available to the Board without the need for F3 services, and defendant had a
motive to resist disclosure of the investigative report and his prior employment records.
16.
Additionally, no other Board trustee offered any reason which necessitated F3’s services.
In an e-mail to Superintendent Coleman, defendant characterized F3 as a “specialized
experienced Firm,” but during conversation, defendant advised that he had “just picked
[F3] out of the phone book,” seemingly at odds with his description of F3.
The prosecutor also provided evidence that one Board trustee overheard legal
discussions between an F3 attorney and defendant that concerned legal advice as to
defendant’s personal civil liability for his actions leading up the censure resolution. The
evidence supports an inference that defendant personally benefitted from the F3 legal
contract by obtaining legal advice relating to his censure and limiting disclosure pursuant
to the PRA request without having to pay for an attorney at his own personal expense.
During the section 995 hearing, defendant suggested that the purpose of the F3
legal contract was described in an e-mail to Superintendent Coleman by an F3 attorney
on January 19, 2021. The F3 attorney described meeting with defendant and another
trustee after the January 14, 2021 vote and discussions regarding F3 assisting the Board
to “resolve and move forward from the censure motion,” steps to improve the Board’s
relationship with senior staff and employees, workshops focusing on relationships, Board
member roles and responsibilities, and parliamentary procedures. The trial court
concluded that it would be normal to engage a law firm to address the Board’s turmoil as
a result of the censure motion. However, the description of the work performed by F3 as
reflected in the February and March 2021 invoices do not contain any references to
education classes or workshops for improving Board relations but seem to address several
topics that would be of personalized concern to defendant.
We may not substitute our judgment as to the weight of the evidence for that of the
magistrate, and having found evidence to support that the F3 legal contract was to limit
disclosure of the investigative report in response to the PRA request, we will not inquire
into its sufficiency. (Rideout v. Superior Court, supra, 67 Cal.2d at p. 474.) In short, the
evidence from the preliminary hearing shows that defendant acted without lawful
17.
authority in contracting with F3, knew or was criminally negligent in failing to know the
contract was unlawful, and caused the Board’s monies to be used to further his personal
interests in limiting disclosure of the investigative report leading to the censure resolution
and otherwise limiting his personal liability for its conclusions without expending his
own funds.
The evidence sufficiently demonstrates that defendant took “affirmative action
with respect to those moneys that he … can be said to have ‘appropriate[d]’ them.”
(People v. Hubbard, supra, 63 Cal.4th at p. 397.) Therefore, we find the evidence from
the preliminary hearing is sufficient to hold defendant to answer to the charge of
misappropriation of public monies.
C. Making a Contract While Having a Financial Interest
1) Applicable Law
“Section 1090 provides in relevant part: ‘Members of the Legislature, state,
county, district, judicial district, and city officers or employees shall not be financially
interested in any contract made by them in their official capacity, or by any body or board
of which they are members.’ It codifies the long-standing common law rule that barred
public officials from being personally financially interested in the contracts they formed
in their official capacities. [Citations.] [¶] The common law rule and section 1090
recognize ‘[t]he truism that a person cannot serve two masters simultaneously ….’
[Citations.] ‘The evil to be thwarted by section 1090 is easily identified: If a public
official is pulled in one direction by his financial interest and in another direction by his
official duties, his judgment cannot and should not be trusted, even if he attempts
impartiality.’ ” (Lexin, supra, 47 Cal.4th at pp. 1072–1073, fn. omitted, third bracketed
insertion in original.)
“To determine whether section 1090 has been violated, a court must identify
(1) whether the defendant government officials or employees participated in the making
of a contract in their official capacities, (2) whether the defendants had a cognizable
18.
financial interest in that contract, and (3) (if raised as an affirmative defense) whether the
cognizable interest falls within any one of section 1091’s or section 1091.5’s exceptions
for remote or minimal interests. [Citations.] Proof of a violation of section 1097, the
provision criminalizing violations of section 1090, requires a further showing that the
section 1090 violation was knowing and willful.” (Lexin, supra, 47 Cal.4th at p. 1074,
fn. omitted.)
2) Analysis
The focus of section 1090 is the making of a contract in which one has
impermissible interest. (Lexin, supra, 47 Cal.4th at p. 1074.) The information alleges
that defendant illegally participated in making the F3 contract. It is undisputed that
defendant initially sought out and communicated with F3, put the issue of the contract on
the January 14, 2021 agenda, and voted on entering into it. Furthermore, we conclude
that the evidence is such that a reasonable person could conclude defendant had a
financial interest in the contract.
“ ‘[T]he term “financially interested” in section 1090 cannot be interpreted in a
restricted and technical manner.’ [Citation.] The defining characteristic of a prohibited
financial interest is whether it has the potential to divide an official’s loyalties and
compromise the undivided representation of the public interests the official is charged
with protecting. [Citation.] Thus, that the interest ‘might be small or indirect is
immaterial so long as it is such as deprives the [people] of his overriding fidelity to
[them] and places him in the compromising situation where, in the exercise of his official
judgment or discretion, he may be influenced by personal considerations rather than the
public good.’ ” (Lexin, supra, 47 Cal.4th at p. 1075, second and third bracketed
insertions added.) Direct and indirect interests are equally prohibited. (Ibid., citing
Thomson v. Call (1985) 38 Cal.3d 633, 645.)
The prosecutor presented evidence that defendant’s conduct had been the subject
of an investigation and the proposed Board resolution to censure him. When the
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resolution was defeated in December 2020, media requested disclosure of the
investigative report and defendant’s former employment records with the District.
Defendant had a personal interest in limiting disclosure of the report, which could have
resulted in negative publicity and a renewed censure resolution, depending upon the
public’s response. Some evidence was presented that the Board voted in a closed session
on January 14, 2021, to waive attorney-client privilege and release the investigative
report in response to the PRA request, and yet F3’s invoices show charges for reviewing
and analyzing redactions to the investigative report and strategies and options for
responding to the PRA request, as well as issues pertaining to the release of the personnel
file information contained in the PRA request (the PRA request sought defendant’s
personnel file from his prior District employment).
The magistrate concluded it was at least a question of fact whether one could infer
from the sequence of events regarding the F3 legal contract that the District paid over
$11,000 in legal fees to F3 to defendant’s advantage and to protect his private concerns.
The evidence supports the prosecution’s argument that defendant used the contract to
further his own personal interests in limiting disclosure of the investigative report on his
conduct and personnel records without having to expend his own monies to personally
engage the services of an attorney.
We agree that the evidence from the preliminary hearing demonstrates a strong
suspicion that defendant perceived a personal benefit by using F3 and the District’s
monies to further his personal interests. “[P]rohibited financial interests are not limited to
express agreements for benefit and need not be proven by direct evidence. Rather,
forbidden interests extend to expectations of benefit by express or implied agreement and
may be inferred from the circumstances.” (People v. Honig (1996) 48 Cal.App.4th 289,
315 (Honig).) At the stage of a motion to set aside the information, the prosecution’s
evidence is strong enough to proceed.
20.
The trial court, in granting the motion to set aside counts 1 and 2, concluded that
defendant did not have a conflict of interest in the F3 legal contract because he was not a
partner in F3 and could not have benefitted from the contract, nor did he receive a
kickback from the contract, and because F3 owed a duty to the District, F3’s work did not
benefit defendant. However, the prosecution provided evidence that but for defendant’s
personal interest in limiting disclosure of the censure-related documents in response to
the PRA request and his vote affirming the contract, F3 would not have been hired to
work on these issues and the District would not have paid $11,000 in legal fees. As long
as a contract is directly or indirectly the result of a conflict of interest, the contractual
terms are irrelevant. (Honig, supra, 48 Cal.App.4th at p. 314.)
A public officer need not acquire an interest in a contract (as in the case of self-
dealing) or share in the contract’s profits to come within Government Code
section 1090’s proscription. (Honig, supra, 48 Cal.App.4th at p. 315.) Government Code
section 1090 targets any interest which would prevent a public official from exercising
absolute loyalty and undivided allegiance to the governmental entity they serve. (Honig,
at p. 315.) Even if a public official makes a contract in which his interest is small or
indirect, a crime is established so long as the interest “ ‘is such as deprives the [state] of
his overriding fidelity to it and places him in the compromising situation where, in the
exercise of his official judgment or discretion, he may be influenced by personal
considerations rather than the public good.’ ” (Ibid.)
As we have discussed, defendant received the benefit of legal advice concerning
his personal interests from the F3 contract without expending personal monies for the
legal advice and could influence the District’s response to the PRA request through the
contract. Therefore, we find the evidence from the preliminary hearing is sufficient to
hold defendant to answer to the charge of misappropriation of public monies.
21.
DISPOSITION
The trial court’s order setting aside counts 1 and 2 of the information is reversed.
The trial court is directed to vacate its May 8, 2025 order granting defendant’s
section 995 motion and thereafter issue a new and different order denying the motion.
22.
DeSantos, J., Concurring and dissenting.
I respectfully dissent in part. As for count 1, I do not believe the magistrate’s
conclusion that the evidence presented at the preliminary hearing established reasonable
or probable cause that defendant misappropriated public monies without legal authority
under Penal Code section 424 was reasonable. As such, I would affirm the trial court’s
order granting defendant’s Penal Code section 995 motion as to count 1.
To prove a violation of Penal Code section 424, subdivision (a)(1), the People
must prove that defendant was a person “charged with the receipt, safekeeping, transfer,
or disbursement of public moneys”; took public money for his own or someone else’s use
without legal authority; and did so with actual knowledge or criminal negligence.
(People v. Hubbard (2016) 63 Cal.4th 378; Stark v. Superior Court (2011) 52 Cal.4th
368, 399.)
As the majority points out, the present case is not a typical violation of Penal Code
section 424. The approximately $11,000 defendant was alleged to have taken was paid to
F3 for legal services rendered in accordance with a contract approved of by a majority of
the Board. The People contend the evidence presented at the preliminary hearing
demonstrated this was a result of a “scheme” engineered by defendant to obtain $11,000
of individual legal services and “ha[ve] the School District pay the bills.” Such a
conclusion, in my view, is unreasonable based on the evidence presented.
The People did not establish that the Board majority’s decision to contract with F3
was not authorized by their bylaws or was otherwise illegal, despite some irregularities.
It is undisputed the RFP process was not followed, but Board Bylaw No. 9124 allows for
bypass of RFP procedures “when a majority of the Board determines that the unique
demands of a particular issue or emergency situation so requires.” (Emphasis added.)
The discussion at the preliminary hearing and the majority focus on whether an
emergency situation was identified, but it appears to me that the majority of the Board
was acting under the former condition. The evidence shows the Board obtained
assistance from F3 “for specialized legal services … due to unique demands of a
particular issue and urgent related timing restrictions,” as stated in the minutes for the
February 3, 2021 special board meeting. Citing Board Bylaw No. 9124, the minutes state
that the “unique censure motion, and related issues, including but not limited to the 2020
investigation and PRA requests for the same” necessitated a contract with F3 without
initiating an RFP. Even if defendant was not authorized to begin discussions with F3,
which, unlike the majority, I do not believe was established by the evidence, the decision
to enter into a contract for legal services without undergoing the RFP process was in
essence ratified by the majority of the Board when it voted to approve the contract.
I acknowledge that the superintendent and other witnesses did not believe it was
necessary to either bypass the RFA process or contract with F3, but I am hesitant to base
criminal liability on what could be, on the preliminary hearing record, a legitimate
difference of opinion among Board members, even taking into consideration the burden
of proof at the preliminary hearing stage.
The People also did not offer evidence to support that defendant inappropriately
influenced the votes of the other Board members by fraud or duress, nor that they were
coperpetrators in defendant’s alleged scheme, and therefore it appears to me their votes to
approve the contract were legitimately supported by belief that F3’s services were
appropriate and necessary. For contrast, in Webb v. Superior Court (1988) 202
Cal.App.3d 872, this court found an atypical violation of Penal Code section 424,
subdivision (a)(1) where a county supervisor who engaged in an elaborate ploy to fund a
construction project on both county and city property through dishonest means. Evidence
was presented in that case that though the board of supervisors had partly authorized
expenditures for this project, the defendant supervisor had not been forthcoming about
what authorized expenditures would be for and acted outside the scope of the
authorizations. (See Webb, at pp. 891-892 (conc. & dis. opn. of Ardaiz, J.).) As I have
stated, the People did not present evidence that defendant made misrepresentations to the
2.
Board in the present case. I am troubled by the implication that the other Board members
who voted to approve the contract are also open to some criminal liability under the
People’s theory without more evidence regarding their actions.
I also believe the People did not make a showing that the money paid to F3 was
for defendant’s personal use. Such a showing, to me, requires an unreasonable inference
that F3 was improperly rendering individual services to defendant.1
In contracting with the Board as its client, F3 bore a professional responsibility to
the Board. To provide legal advice to defendant to the detriment of its client, the Board,
would have been a conflict of interest on behalf of F3 and an ethical violation. (See Cal.
Rules of Prof. Conduct, rule 1.7 [“A lawyer shall not, without informed written consent
from each client … represent a client if the representation is directly adverse to another
client in the same or a separate matter.”].) The People offered no evidence and did not
argue that F3 acted unethically in its representation in accordance with the contract.
Without this evidence, it appears to me the majority of the Board legitimately contracted
with F3 and received proper representation from which it presumably benefitted, making
any benefit defendant received incidental and not, to my satisfaction, a criminal
misappropriation.
As for count 2, I agree with the majority that a viable question of fact for the jury
exists as to whether defendant perceived some personal indirect financial benefit from the
contract with F3, so as to render his participating in making the contract a conflict of
interest within the meaning of Government Code section 1090, and the trial court’s order
setting aside count 2 of the information should be reversed.
1 Even if defendant acted improperly by acting as the deciding vote in approving the
F3 contract, in order to support the People’s theory, the People would have had to show
that the money paid to F3 was for defendant’s personal use. Notably, the People’s theory
is not that defendant’s misappropriation was for the use of the Board or F3, but for his
own use.
3.