City of Industry

The City of Industry hopes to cancel or renegotiate its $12-million-a-year trash contract with Valley Vista Services. (Luis Sinco / Los Angeles Times)

By Frank Shyong
May 28, 2015

The City of Industry has filed suit against former Mayor David Perez, his companies and four members of his family, alleging the misappropriation of millions of dollars in public funds through false or inflated invoices and the performance of unauthorized work on city contracts.

The suit echoes the finding of a city-commissioned audit, which found that the Perezes and their companies made more than $326 million from the city over the last two decades.

Since the findings were published in April, the state controller and the Los Angeles County district attorney’s office have launched parallel investigations into the city’s contracts with the Perez-owned companies.

Industry City Atty. Michele Vadon did not return calls for comment, and calls to members of the Perez family were not returned.

The city is alleging multiple instances of fraud, breaches of fiduciary duty and unfair business practices, among other violations.

The suit doesn’t specify an amount for damages, but claims that the Perez-owned companies misappropriated an amount “in the millions of dollars.” The city asks for penalties of up to $11,000 for each alleged violation and seeks three times the amount of whatever damages the city sustained as restitution.

The district attorney’s office investigated Industry’s finances following a Times investigation in 2009 that detailed Perez’s lucrative business dealings with the city. But the inquiry was dropped in 2011 and no charges were filed.

Perez, who served as Industry’s mayor for about a decade, stepped down in 2012, citing health reasons and the desire to spend more time with his family.

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