Mathys is focus of lawsuit
By Bill McEwen
The Fresno Bee, September 17, 2001
The conduct of City Council Member Chris Mathys in the derailment of a low-income apartment complex in northwest Fresno and a zoning deal he allegedly cut with a prominent developer are the focus of a $10 million lawsuit wending through federal court.
In a 90-page opinion, U.S. District Judge Oliver W. Wanger said it should be decided at trial whether the city of Fresno and Mathys, acting in an individual capacity, violated the Fair Housing Act and state laws, conspired to deprive civil rights and interfered with a contract based on race.
Shortly after joining the council in 1997, Mathys helped kill the proposed 324-unit Wellington Place Apartments -- thus allaying constituent fears of increased crime, overcrowded schools and declining property values.
Court documents include allegations that he was a conduit for the related rezoning of two properties near North Herndon Avenue owned by Robert McCaffrey, one of the Valley's most successful and powerful developers.
Said Wanger: "The evidence presented as to Mr. Mathys is sufficient to create a genuine issue of fact as to whether he conspired with Mr. McCaffrey and any citizen defendants with respect to [rezoning] to perpetuate housing discrimination."
The city has spent $1.3 million defending Mathys and four other council members in suits filed by Affordable Housing Development Corp., or AHDC, and Ashwood Construction.
Wanger dropped the other council members -- Garry Bredefeld, Sal Quintero, Henry Perea and Dan Ronquillo -- from the suit.
The judge also dismissed seven of the 12 northwest homeowners sued by AHDC.
The apartment developers, who held an option to buy the larger of the two properties, aren't suing McCaffrey.
City officials are contemplating steps to separate the city from the conduct of Mathys, a one-term council member who is leaving in January.
This possibility is outlined in a confidential memo written by City Attorney Hilda Cantu Montoy to other council members following summary judgment rulings by Wanger. The city has provided Mathys with separate counsel since February 1999.
"As a matter of strategy, we will explore advantages and disadvantages for the city to distance itself from the conduct of Council Member Mathys," Montoy said in a document obtained by The Bee.
With other council members removed from the suit, Montoy said, "the sole focus is upon the actions of Mathys and how they might be connected to the city."
Those alleged actions -- holding neighborhood meetings, distributing fliers and, in general, marshaling opposition to the apartments, which would have set aside 20% of its units for low-income residents -- were cited by Wanger in allowing portions of the suit to continue.
The court documents also contain allegations that Mathys attempted to intimidate Robert C. Wilson, at the time the executive director of the Fresno Housing Authority, which endorsed the complex.
"That message was conveyed to us...that we weren't expected to support the project," Wilson said in a deposition. Nancy A. Jenner, a Visalia lawyer who represents Mathys, said she wasn't surprised by Wanger's decision to deny her request to drop the council member from the suit.
"It's precisely what we predicted," Jenner said. "He did a thorough analysis of the facts. But the city and Chris are in a very defensible position, and I am confident it will come out a victory.
"Council members represent their constituents. These people got sued for doing just that."
Jenner declined to comment on Montoy's memo, saying that she hadn't read it.
Peter Herzog, a Clovis developer and AHDC partner, says he is pleased the suit is moving forward.
"Finally, after 36 months of delay tactics by the city, it's clear they have a potentially significant problem on their hands," Herzog said.
Rezoning won council's OK
In denying a city request for complete dismissal, Wanger cited the City Council's rezoning of 23.5 acres near Gregory and Spruce avenues, where the complex was supposed to go, and 6 more acres near Herndon and Spruce.
As described in court documents, McCaffrey sought to have the Wellington site rezoned from multi-family residential to single-family residential, thus appeasing neighbors who opposed the complex.
In return, McCaffrey wanted a potentially lucrative commercial designation for the smaller parcel, which was zoned for professional offices.
The council unanimously approved his requests.
"We are sensitive to the homeowners' concerns and have, by the subject application, proposed an approach which we believe creates a 'win-win' solution for all concerned," McCaffrey wrote in a letter to Mathys one month after the council decided against authorizing $30 million in tax-exempt bonds for Wellington Place in March 1997.
"If the application is approved, the existing single-family homeowners are assured that the subject acreage will not be developed for any multi-family use. That is their 'win.'...This upgrade...would be our 'win.'"
Mathys acknowledged in his deposition that he told McCaffrey that residents would "support single-family homes at that location."
Asked whether the rezonings were a package deal, Mathys answered, "Right."
The residential site remains undeveloped. The smaller parcel was sold by McCaffrey to developers who built an assisted-living center near Herndon and Spruce.
McCaffrey didn't respond to a request for comment. Mathys declined to be interviewed. Instead, he provided this statement via e-mail:
"Unfortunately a lobbyist didn't get his way and is now attempting to silence my neighbors and [me] through threats and frivolous litigation," Mathys said. "Threats or no threats, Chris Mathys will continue to fight for the people of Fresno and make decisions in their best interest."
Based on a deposition given by then Council Member Mike Briggs -- who joined Ken Steitz in voting for the complex -- AHDC sought to link other council members to its conspiracy allegations.
Briggs, now a state Assembly member, said in court documents that he was surprised by the lack of support from council members who "often stood up for those who are underrepresented in our community."
Added Briggs: "[It] appeared obvious...that some sort of deal had taken place, some sort of an agreement between council members to attain a vote in one direction."
Wanger ruled that Briggs' contention was "speculation" and there was "absolutely no evidence" of intentional interference by Bredefeld, Quintero, Perea and Ronquillo.
The judge also ordered sanctions against William J. Davis, an Irvine lawyer representing AHDC, for interviewing Briggs months before his deposition without city permission.
The interview violated the city's attorney-client privilege, said Wanger, who ruled that AHDC lawyers can't use privileged information revealed to them by Briggs.
Speech, housing rights clash
Lawyers say this is a complex case pitting free-speech guarantees vs. fair-housing rights. It also is likely to test a state law that allows governments to consider the effects on schools, such as overcrowding, in making zoning decisions.
"It's very complicated," said James P. Lough, a former city attorney who is among several lawyers representing the homeowners. "We've looked at 200 cases, trying to find similarities, and there are very few."
The Center for Individual Rights, or CIR, says the suit resembles one involving Berkeley residents who opposed a low-income housing project and then were accused of discrimination by federal officials.
A judge ruled that the officials were liable in their personal capacities for violating the First Amendment rights of project opponents. The case is on appeal.
CIR, based in Washington, D.C., is a nonprofit law firm specializing in civil-rights and free-speech issues. It represented Travis Compton, one of the Fresno homeowners dropped from the suit.
Terence Pell, chief executive officer of CIR, said the Fresno case is the "first one of these involving someone other than the federal government using federal housing laws to silence or intimidate individuals who speak out against low-income housing projects.
"We're hopeful that this decision [to dismiss Compton] will discourage developers from this particular abuse of discrimination law."
Davis, the AHDC lawyer, says free-speech guarantees don't provide blanket protection.
"It is illegal under federal law to facilitate the exclusion of people and to exclude families with children, most of whom would be minorities," Davis said.
Lough says the dismissal of seven homeowners from the suit was a significant victory for their side.
"Even for the ones that are still in, most of the case is over," Lough said of Wanger's rulings.
"We're down to whether or not it was discriminatory to circulate meeting notices about the project and whether or not a couple of remarks made at the meetings were considered threats."
Lough said the trial probably would begin early next year. Also pending is a countersuit filed by the homeowners against AHDC, Lough said.
"I am so relieved that this part of the litigation is finally over, and I'm looking forward to a final and complete resolution. I never did anything wrong," said Compton, who ran up $30,000 in legal bills before turning to CIR.
"All I ever did was try to facilitate communication between groups and to participate in what I had always understood to be part of the traditional democratic process: debate and discussion."
Last revised: January 7, 2009