Judge Declares a Mistrial in Federal Mail Fraud Case

After 53 days of testimony, a mistrial was declared Tuesday in the federal mail fraud case against two former high-ranking San Diego County officials and three telecommunication executives.

“We can’t unring the bell,” said U.S. District Judge Earl B. Gilliam in making the ruling, explaining that grand jury indictments and trial testimony included prejudicial material against the defendants which, under a recent U.S. Supreme Court ruling, he would not have allowed.

In dismissing the jury that has heard the case since it began in March, Gilliam said he would have ruled differently on admission of evidence about alleged bribes, kickbacks, cocaine use, furnishing prostitutes and other alleged offenses if the Supreme Court ruling had been in force at the time.

The high court ruled last month that public officials may not be convicted in mail fraud schemes unless prosecutors prove that the public taxpayers lost money--not simply that the politicians or bureaucrats enriched themselves or their associates.

The five defendants and their attorneys are charged with identical counts of mail fraud in connection with the awarding of a $24.5-million county contract for a sophisticated microwave communications system to Telink Inc. of Anaheim.

Telink and its parent company, Florida-based Burnup & Sims Inc., pleaded no contest last year to criminal charges against them and agreed to pay more than $1 million for prosecution costs of the 13 individuals and the two corporations indicted by the federal grand jury in 1984.

The Telink scandal, which San Diego County Dist. Atty. Edwin Miller called “the most massive fraud and public corruption scheme ever perpetrated against the County of San Diego,” became public in October, 1982, when law enforcement agents armed with search warrants seized documents from offices and homes of more than a dozen county and telecommunications officials.

Judge Gilliam, in declaring a mistrial, said it would create “utter chaos” to try to sort out and order the jury to disregard testimony and evidence aimed at proving that the public had been deprived of the “good and faithful services” of the former county officials in the scheme to obtain the multimillion-dollar telephone system contract for Telink. That portion of the federal mail fraud law--losses not involving public money or property--was struck down by the Supreme Court ruling in June.

An angry juror, 72-year-old David Oldham of El Cajon, said the mistrial ruling Tuesday was “maddening, frustrating and seems so unnecessary.” Oldham said the abrupt end of the lengthy trial “seems such an awful waste of time and so many dollars wasted.”

Gilliam admitted that he was reluctant to call the mistrial, but felt that the Supreme Court ruling required that the judicial process begin again, ruling out much testimony that did not relate to loss of public money or property. He set the new trial for Sept. 15 and predicted that the second trial would be much shorter because of the bulk of evidence ruled out by the high court’s decision.

Federal prosecutor Lantz Lewis said Tuesday that he would meet next week with Miller and U.S. Attorney Peter Nunez to decide whether to seek new grand jury indictments, amend current charges to conform with the Supreme Court ruling or proceed again with the same indictment charges against the five defendants.

The five are Hilario “Larry” Gonsales, former county director of general services; Abraham Stein, former county communications chief; Don Woodaman, president of the now-defunct consulting firm, Telecommunications Design Corp.; Robert Schreiber, vice president of the former Telecomm Consultants Inc., the firm hired by the county to evaluate bids on the space-age communications system for county offices, and Jim Linder, former marketing director for Telink.

The government is charging that Telecomm Consultants and Telecommunications Design executives, with help from Stein, Linder, Gonsales and others, sought to rig the bidding procedure so that Telink would receive the $24.5-million contract over other bidders, including Pacific Telephone Co. Telink did receive the bid award, but the contract was canceled after the scandal became public.