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Miner who won massive award against Sacramento County had business-related criminal conviction

Photo illustration
Photo illustration

Prosecutors deny it, but lawyers for the gravel miner who won a massive federal jury verdict against Sacramento County say it was politics that twice in recent years put their client in danger of going to jail.

Joseph Leonard Hardesty pleaded no contest to a single misdemeanor count, was sentenced to a year’s probation and paid a $5,000 restitution fee in one of the criminal cases. In the other, he made the case go away by agreeing to pay for the cost of investigating him – $45,000. Both cases involved environmental-violation charges.

Last month, a U.S. District Court jury awarded Hardesty $75 million after he accused Sacramento County officials of putting his sand and gravel mine near Sloughhouse out of business. The same panel on March 21 awarded co-plaintiff Jay Schneider, the landowner and rancher who leased the mine to Hardesty, another $30 million.

On top of the general damages, jurors bumped up the overall price tag on the suit to $107 million when it also awarded the plaintiffs punitive damages against former Sacramento County Supervisor Roger Dickinson, former planning director Robert Sherry and former aggregate resource manager Jeff Gamel.

Sacramento County lawyers say they will challenge the awards in post-trial motions.

In the federal lawsuit he filed in 2010, Hardesty charged that state, county and federal agencies hounded him out of business as a result of political pressure applied on them by his most prominent rival gravel mining competitor, the industry powerhouse Teichert Construction.

The company, in fact, had complained to numerous government officials that Hardesty enjoyed an unfair business advantage by operating without a permit under a “vested right” bestowed on the so-called Schneider Historic Mine that had been handed down to his co-plaintiff.

According to evidence at trial, Hardesty ramped up his production from 9,840 tons per year in 1995 to 242,065 tons in 2007, and his mining operation had begun to encroach on the Cosumnes River. In 2009, the county insisted he get a conditional use permit.

Hardesty’s lawyers say that along with the increased regulatory attention, the two criminal cases against their client were stirred by Teichert.

“The government and Teichert had a campaign to put Joe Hardesty out of business,” attorneys William Brewer of San Francisco, R. Paul Yetter of Houston and G. David Robertson of Reno said in a joint statement. “The criminal charges were part of that campaign and totally false. Joe tried to fight city hall, and those charges were pure retaliation.”

Steve Grippi, chief deputy district attorney in Sacramento, denied that politics played a role in the prosecution of Hardesty.

“All I know is we file 25,000 cases a year, and we didn’t pick out Mr. Hardesty for special prosecution,” Grippi said.

El Dorado County Deputy District Attorney Dale R. Gomes, who handled the Hardesty case in his jurisdiction, also disputed that politics factored into it. Teichert “was not involved in our case,” Gomes said in an email to The Bee.

The criminal case in Sacramento stemmed from a series of inspections eight years ago on the premises of Hardesty Sand and Gravel on Meiss Road.

During a March 24, 2009, inspection conducted by state and local air quality agencies, a Sacramento County district attorney’s investigator who accompanied officials to provide on-site security said in a later search warrant that he made “plain view” observations of what he thought to be environmental violations.

DA’s investigator Brian Maloney said in an affidavit that he saw “petroleum products” from mining machinery that had “soaked into and pooled on soil and in drums at different locations of the business operation.” Maloney wrote that the substances potentially could run off into “different bodies of water” or seep into the groundwater.

According to Maloney’s affidavit, Hardesty never reported the spills, and “sediment laden waste water was discharged into the waters of the state.”

Six months later, Sacramento prosecutors filed a 15-count misdemeanor complaint against Hardesty, and on Jan. 31, 2011 – following a lengthy and unsuccessful effort by his lawyers to suppress evidence obtained by the search – he pleaded no contest to a single count of storing hazardous materials without a permit, paid $5,000 and was sentenced to a year’s probation.

Less than two weeks before his probation was supposed to expire, a Sacramento judge revoked it. Former Sacramento Deputy District Attorney Jane Crue, who is now a prosecutor in Placer County, said in court papers that she requested the revocation due to “numerous violations” at Hardesty’s mines in Sacramento and El Dorado counties.

A violation of probation hearing on Hardesty in Sacramento was stayed pending the resolution of the El Dorado County case, which was filed on Jan. 26, 2012.

The 14-count misdemeanor complaint in the neighboring county was terminated in December 2014, when Hardesty agreed to pay $45,000 in exchange for prosecutors dropping all the criminal charges, according to court records.

Drawn up by El Dorado County prosecutor Gomes, the agreement said that Hardesty signed off “merely for the purpose of compromise” and “to avoid the expense of litigation” and that he “does not admit the truth of any allegation of the complaint.”

Gomes wrote in the agreement that the money would go to five different agencies to pay for their work in “the investigation and prosecution concerning purported acts at the Big Cut Mine” near Placerville.

Hardesty also agreed under the terms of the deal “not to commence surface mining operations” on the Big Cut Mine unless he obtained all the proper permits and submitted an approved reclamation plan.

No mention of either criminal case was allowed in the federal trial. Judge Kimberly J. Mueller excluded them on arguments by Hardesty’s lawyers that they were irrelevant to the civil case and that they would confuse and prejudice the jury.

Meanwhile, with $107 million hanging in the balance from the federal jury’s verdict in Sacramento, the plaintiffs still have a long way to go to collect any of the cash.

With the county’s lawyers poised to fight the jury’s award, the 28-day deadline for filing their post-trial motions has been delayed until an ancillary matter is decided in the 9th U.S. Circuit Court of Appeals.

Dennis O’Bryant, the retired former assistant director of the state Office of Mine Reclamation, had been named as a defendant in the Hardesty-Schneider lawsuit. They sued O’Bryant in his official capacity for removing Hardesty Sand and Gravel from the state’s list of contractors.

California Department of Justice attorneys filed a motion before trial to dismiss O’Bryant from the action on grounds that he had “qualified immunity.” They said in court papers that O’Bryant “took enforcement action” against Hardesty “to protect the public.”

Judge Mueller denied O’Bryant’s motion to get out of the case, and O’Bryant appealed to the 9th Circuit, where the matter is still pending.

As a result, Mueller, eight days after the verdict, vacated her order of judgment that officially designated the conclusion of the trial. She had initially signed off on verdict the day after the jury rendered it. With the order withdrawn, the clock technically has not begun to run on the timeline for the county attorneys to file their post-trial motions.

Last week, the lawyers for the plaintiffs filed a motion to sever the O’Bryant matter from the main case. They have asked for a May 19 hearing on the severance.

Andy Furillo: 916-321-1141, @andyfurillo

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