1 RIVERSIDE, CALIFORNIA; AUGUST 13, 2019 · 2019-08-13 · So news 9 about the awards gala is very...

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1 RIVERSIDE, CALIFORNIA; AUGUST 13, 2019

2 GRAND JURY FOREPERSON: The grand jury will now come to

3 order. Please turn off your phones.

4 I'll remind the court reporter you're still under the

5 oath you took yesterday.

6 I would start the day by admonishing the grand jurors

7 that they are not to form or express any opinions about the case

8 or discuss it among themselves until the grand jury receives the

9 case for deliberations.

10 In addition, no inspection of evidence should be

11 conducted without permission of the foreperson and on the advice

12 of the prosecuting attorney until the case is submitted to the

13 grand jury for deliberation. Deliberations should only occur

14 when all jurors that have heard all the testimony in the case

15 are present.

16 With that, will the secretary please take the roll.

17 GRAND JURY SECRETARY: Juror 1.

18 GRAND JUROR NO. 1: Here.

19 GRAND JURY SECRETARY: Two?


21 GRAND JURY SECRETARY: Three?


23 GRAND JURY SECRETARY: Four?


25 GRAND JURY SECRETARY: Five?


27 GRAND JURY SECRETARY: Six?


DARLA J. MILLER, CSR

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1 GRAND JURY SECRETARY: Seven?

2 GRAND JURY FOREPERSON: Here.

3 GRAND JURY SECRETARY: Eight?


5 GRAND JURY SECRETARY: Nine?


7 GRAND JURY SECRETARY: Ten?


9 GRAND JURY SECRETARY: Eleven?

10 GRAND JUROR NO. 11: Here. Sorry.

11 GRAND JURY SECRETARY: Twelve?


13 GRAND JURY SECRETARY: Thirteen?


15 GRAND JURY SECRETARY: Fourteen?


17 GRAND JURY SECRETARY: Fifteen, here.

18 Sixteen?


20 GRAND JURY SECRETARY: Seventeen?


22 GRAND JURY SECRETARY: Eighteen?


24 GRAND JURY SECRETARY: Nineteen?


26 GRAND JURY FOREPERSON: The record will reflect that

27 all 19 jurors are present.

28 Counsel, you may begin.


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1 MS. BARAJAS: We're going to go out of order and call

2 Mr. Matzner first this morning, as Mr. Marantz has yet to

3 arrive.

4 GRAND JURY FOREPERSON: Please remain standing --

5 THE WITNESS: Sure.

6 GRAND JURY FOREPERSON: -- and raise your right hand.

7 You do solemnly swear that the evidence you shall give

8 in this proceeding shall be the truth, the whole truth, and

9 nothing but the truth, so help you God?

10 THE WITNESS: I do.

11 GRAND JURY FOREPERSON: Please be seated.

12 I have a statement acknowledging a secrecy order that I

13 would like you to read it to yourself, then sign and print your

14 name and date it at the bottom.

15 Thank you.

16 Please state and spell your full name for the record.

17 THE WITNESS: Harold Matzner, Harold, H-a-r-o-l-d,

18 M-a-t-z-n-e-r.

19 GRAND JURY FOREPERSON: Thank you.


21 MS. BARAJAS: Thank you.

22 HAROLD MATZNER,

23 called as a witness by the plaintiff, was sworn and testified as

24 follows:

25 DIRECT EXAMINATION

26 BY MS. BARAJAS:

27 Q. Good morning, Mr. Matzner.

28 A. Good morning.


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1 Q. My name is Amy Barajas. I am the district attorney

2 that will be questioning you this morning.

3 A. Okay.

4 Q. Okay. You and I have never spoken before; is that

5 correct?

6 A. We have not.

7 Q. And I've never met you before either; correct?

8 A. That's correct.

9 Q. Welcome. Thank you for being with us today.

10 Sir, can you tell us a little bit about what you do for

11 a living today.

12 A. Well, I'm 82, so I should be retired, but I'm not.

13 And, um, I have an advertising company in the East that's in the

14 preprint advertising business and joint ventures with

15 newspapers.

16 And in California I'm the chairman of the McCallum

17 Theatre, which is a very prominent theater in the Coachella

18 Valley. I'm chairman of the Palm Springs International Film

19 Festival Awards Gala, which is a huge event that is run in

20 January and kicks off the awards season in the film industry.

21 And I'm the executive vice chairman of the Palm Springs Art

22 Museum and the chairman of the Palm Springs Tennis Club. And

23 those are like really jobs that I do in the area where I'm

24 living.

25 Q. You're very busy then?

26 A. I am very busy for my age.

27 Q. Let me ask you a little bit about some of the business

28 that you do in Palm Springs, some of the work that you do, not


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1 necessarily business.

2 Do you reside in Palm Springs for a portion of the

3 year?

4 A. I'm in Palm Springs about six months, sometimes seven

5 months. I go back and forth because these nonprofits require

6 attention.

7 Q. Yes. So do you live here in California for a portion

8 of the year, and then back East in New York for the other

9 portion of the year?


11 Q. And you talked a little bit about the International

12 Palm Springs Festival, and I would like to hear more about that

13 in a second.

14 You said it's a kickoff to the award season. Is that

15 for Hollywood?

16 A. Yes, for the Academy Awards.

17 Q. And what does that mean, for those of us who aren't

18 familiar with the film industry?

19 A. Well, the studios pick certain films that they feel are

20 competitive in quality for the Academy Awards, and they run

21 campaigns, you know, regular campaigns, the way you would for an

22 election. They hire PR people to represent their interests.

23 And our film festival, which is one of the two or three

24 largest in the country, has a film award gala, which is the

25 largest in the country. It has -- normally attendance is 2500

26 paying attendees, and every studio has a film with either an

27 actor or a -- or a status that might bring them a nomination for

28 the Academy Awards, wants to be in this film awards gala, which


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1 is timed to begin exactly when the voting for the nominations

2 for the Academy Awards begin. For instance, this year it will

3 be January 2nd, and then the nominations, which run I think

4 about nine days, they will be -- the Academy members will be

5 voting during that period of time.

6 And our awards gala generates literally 12 billion

7 impressions throughout the world. Everybody wants to --

8 everybody opens the door to celebrity in their home. So news

9 about the awards gala is very welcome, and every single

10 entertainment channel carries it. But all the news channels

11 carry it.

12 And if you're sitting in Hong Kong the morning after

13 this gala, you're very likely to get it on the news. Certainly

14 if you're watching any kind of an entertainment news show, you

15 will see it. It's an amazing thing. So it's a great vehicle to

16 promote the brand of Palm Springs, and those of us who are

17 community activists there feel that it has gone a long way to

18 rebuilding our brand and giving us the economic momentum we have

19 today.

20 Palm Springs is a very hot place right now. In terms

21 of economics, it's doing very well.

22 Q. So let me take you back a little bit.

23 So your film festival is as renowned as maybe -- some

24 people have heard of the Sundance Film Festival as well;

25 correct?

26 A. Well, we're not as renowned as Sundance. We'd like to

27 be as renowned as Sundance. But we are a 501(c)(3) nonprofit

28 film festival.


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1 Q. What does that mean, 501(c)(3)?

2 A. 501(c)(3) means that we're serving the community; that

3 the operators of the festival are not making any money; that all

4 the money that's made goes to the community.

5 Sundance is more of a trade show.

6 Q. How so?

7 A. Sundance is really designed as -- I mean, we have

8 136,000 attendants, or some number like that, maybe 135; and

9 they're more in the 22,000 attendants range. But they generate

10 a lot of press because most good new films are staged there. I

11 mean, that's what they do with this. It's like a trade show in

12 any industry. If you make a film, you want to bring it to

13 Sundance, and the industry comes there.

14 Now, we do get the industry for our gala. Everybody --

15 I mean, all of Hollywood comes, the CEOs from all the studios.

16 It's an amazing thing that we've developed over the last 20

17 years. Starting with a little tiny event, it's now a big event.

18 Q. So can I ask you, Mr. Matzner, maybe some of us who are

19 starstruck, do you have like big names like Bradley Cooper

20 and -- I mean, explain to us --

21 A. We have any name -- any big name that's in a film. I

22 was very excited myself -- I've been doing this a long time.

23 I'm really not a celebrity person. I'm not that interested in

24 celebrities. But I saw Wonder Woman with Gal Gadot in it. I

25 was very impressed with her. And then I got a chance for her to

26 come to the gala, even though she -- she really didn't have a

27 chance of being honored by Hollywood. But we decided to honor

28 her anyway. She was wonderful in that film, and she was


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1 wonderful in person. I mean, she was incredible. She was

2 just -- she stole the show.

3 But Bradley Cooper has been there many times. Tom

4 Hanks comes. I mean, everybody comes; whoever is in a film.

5 We usually have 11 honorees and 11 presenters.

6 Q. And what are they being honored for? Their work in

7 that particular film?

8 A. The quality of their work in that film.

9 Q. Okay.

10 A. And we also have an award for entire casts. The entire

11 cast comes. The event is so powerful that no one who has been

12 invited in the last 17 years has refused the invitation. Every

13 single person has shown up, even two of them with pneumonia. So

14 that's pretty cool.

15 So we put something together that really works there

16 and is good for everyone. It's good for the film world. It's

17 good for Palm Springs.

18 Q. And if you could maybe educate some of our younger

19 folks that are here, in the fifties and the sixties, Palm

20 Springs was very famous and had a lot of Hollywood attention as

21 well; correct?

22 A. It did. In the fifties it had two tennis clubs. I'm

23 now chairman of one of them. I rebuilt it because it had

24 degenerated.

25 But there were two tennis clubs, and for some reason

26 Hollywood started drifting to Palm Springs. And the major stars

27 played regularly at these clubs and had homes in the city. Of

28 course it was a very small city at that time, and they were


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1 there more for privacy. And the city had a culture of, you

2 know, not bothering them on the street.

3 My tennis club today has all those pictures. Pictures

4 of Errol Flynn. Anyone here ever heard of Errol Flynn? I don't

5 think so.

6 Q. Frank Sinatra?

7 A. Frank Sinatra was actually a big supporter of this film

8 festival when it began. And, of course, he lived there until

9 his death and was very helpful to the community. An amazing

10 man. He gave $2 million to the Jewish temple, and he certainly

11 was not Jewish.

12 Q. So you spoke earlier about how people paid to come to

13 the events. Is that one way in which you generate revenue for

14 the nonprofit organization?

15 A. We raise -- it's big fund-raiser. We raise $2.5

16 million, and that enables us to run education programs for kids

17 in the schools, and for us to run a large number of screenings

18 because the screenings themselves ultimately lose money. It

19 takes about $7 million to run this festival for 12 weeks.

20 I have this phone. I shouldn't have it. I realize

21 that. So would somebody like it? There's a sign outside

22 that said to give it to someone. I'll just shut it off right

23 now.

24 Q. I'll take it.

25 A. I forgot about it.

26 Q. That's okay.

27 So how much -- well, can anyone come -- let's say, for

28 example, one of us wanted to go. Are we allowed or it's


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1 invitation only?

2 A. If you want to come for a thousand dollars, you can

3 definitely come. Also for $350 if you want to come, I can sign

4 you up right now.

5 Q. Okay. So, generally speaking, it costs a thousand

6 dollars or --

7 A. We actually have donors.

8 Q. Okay.

9 A. We have tables that sell for $50,000.

10 Q. Oh, wow. Okay.

11 A. And we want as many of those obviously as we can get.

12 But we keep the ticket price -- our lowest ticket price is 350,

13 because we want to be very inclusive, so we get about a thousand

14 people in the room at that price level.

15 Q. All right. So this started -- so when did you start

16 this international film festival? This was your project that

17 you started?

18 A. This was Sonny Bono. Anybody remember Sonny Bono?

19 Look at that. That's good.

20 Sonny Bono was our mayor. After he finished with his

21 movie career and his nightclub career and his marriage with Cher

22 ended, he decided that our town was too bureaucratic, and he

23 became the mayor of our town. And he started the film festival.

24 And he was a friend of mine. He taught me how to play

25 tennis. So I helped him a little bit in the beginning, but,

26 um --

27 Q. When you say you helped, Mr. Matzner, do you mean

28 financially?


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1 A. I financially helped in the beginning, and then Sonny

2 just did very well with it. I mean, it got started very well,

3 and I went off and did other things. And then it got in

4 trouble. Sonny died. He hit a tree while skiing and died. It

5 was just tragic. And the festival, a few years later, ran into

6 serious financial trouble. And at that point I decided it was

7 important enough to rescue it.

8 Q. What year was that, do you recall, Mr. Matzner?

9 A. 2000.

10 Q. 2000. So for the last 19 years, then, you've been

11 leading this nonprofit organization; is that correct?

12 A. Nineteen or 20. I've either been chairman -- a friend

13 of mine was chairman for four years, and we kind of did it

14 together. But, yes, that's pretty --

15 Q. So you had noted earlier that everything that you bring

16 in goes to -- it's nonprofit, but there's some people that work

17 there that are paid salaries; correct? You don't have

18 volunteers --

19 A. I want to make a comment about the profit aspect.

20 Q. Sure.

21 A. I just want to say that I don't make a dollar in Palm

22 Springs, not even from -- I do own a restaurant. It's run as a

23 nonprofit restaurant, and the money goes to the community.

24 Q. Which restaurant is that?

25 A. It's called Spencer's. It's a really good restaurant.

26 I don't -- I purposely -- you know, I'm very fortunate,

27 my companies make quite a bit of money. I've never taken a

28 dollar from any business in the city of Palm Springs. That


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1 gives me the ability to pretty much call things the way I see

2 them.

3 Q. That's very kind of you.

4 A. It's not kind; it's a strategy.

5 Q. Well, then, you're a very smart strategist.

6 So since you brought it up, how much would you say

7 you're worth, Mr. Matzner? What's your net worth?

8 A. I really don't want to put that on the record. I mean,

9 if it was important I would do it. But I have a substantial net

10 worth.

11 Q. Okay. I just want the jurors --

12 A. I know quite a few people will see the grand jury

13 minutes. I just wanted to share that. If you don't mind --

14 unless you need it. If you absolutely need it --

15 Q. I want everybody to have a perspective of the influence

16 and the generosity that you've given to not only this community

17 but to others.

18 A. Well, I have given away more than $80 million in Palm

19 Springs, so I have a significant net worth.

20 Q. All right. Perfect. Thank you.

21 So we're talking about your restaurant at Spencer's and

22 your kindness in the community. When you have people working in

23 this nonprofit, though, explain it to us, please. For those of

24 us who are not familiar with nonprofits and how they work, you

25 still can employ individuals? You have to pay the people that

26 are working the industry; is that right?

27 A. Of course, yes.

28 Q. They have to be able to make a living; correct?


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1 A. Yes.

2 Q. All right. So explain to me -- you said that the Palm

3 Springs Film Festival, it costs around 7 million to put on, and

4 you generate about 2 million, 2.5 million in donations; correct?

5 A. Well, we probably don't -- we probably generate a

6 little more than that.

7 Q. Okay.

8 A. But we generate 2.5 million from the gala, the Film

9 Awards Gala, and then we have other sources of donations,

10 whether they're in kind or cash.

11 Q. Sure.

12 A. So we're probably generating something like

13 four-and-a-half to 5 million in total donations.

14 Q. A year?

15 A. Yes.

16 Q. So when you talk about the gala, is the gala just one

17 of perhaps many or several events that take place throughout the

18 year that generate donations for the organization?

19 A. No, not so much. It's the main fund-raiser, and then

20 we run the film festival for about 12 days.

21 Q. Is that near and about the time of the gala?

22 A. It follows the day after the gala. It opens and runs

23 for 12 or 13 days, and it screens -- it has about 550 screens,

24 and it raises a certain amount of money doing that.

25 Q. So people would pay to come and watch the movie, then?

26 A. Yes.

27 Q. Okay. So how many employees does the Palm Springs

28 International Film Festival have?


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1 A. Well, that's really a good question.

2 Q. You can give me your best estimate.

3 A. Well, we have eight from -- I would say are full-time.

4 Q. Yes.

5 A. And then when it hits October 1st, because the festival

6 gets going in January, that number rises to probably 130, 140,

7 with about 800 volunteers -- between 650 and 800 volunteers. We

8 have a lot of volunteers.

9 Q. That's amazing. So in addition to your volunteers and

10 employees that work full-time, is there also a board that you're

11 required to have when you have a nonprofit?

12 A. Yes.

13 Q. And is that the board that you've either been chairman

14 or vice chairman of?

15 A. Yes.

16 Q. And that's a rule in the law; right? It's like a tax

17 rule, it's a federal rule, in order to have a nonprofit status,

18 you have to have a board; correct?

19 A. Correct.

20 Q. And you have to have meetings and there has to be

21 minutes; is that right?

22 A. That is correct.

23 Q. And all of your finances have to be public and

24 available and reported every year; correct?

25 A. And audited.

26 Q. Yes. So let me ask, how many people would you say are

27 on your board?

28 A. Around 35.


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1 Q. And of the 35 people on your board, has it

2 predominantly been the same individuals over the years as well?

3 A. Yes.

4 Q. Okay. Now, you talked about bringing in donations.

5 Would you say that a lot of the people that donate to your

6 organization have been donors for a period of time, or is every

7 year you just start a clean slate?

8 A. Well, that would be terrible.

9 Q. Right.

10 A. No. We try to develop continuity and build

11 relationships and encourage the donor to donate to us on a

12 regular basis.

13 Q. Is there an aspect of the Palm Springs Festival that is

14 for profit? There's like -- is the International Palm Springs

15 Film Festival a D/B/A of another organization?

16 A. There's a film society that's the parent organization

17 that is a nonprofit and runs the film festival and also -- the

18 January film festival, which is the big film festival, and then

19 we have a $500,000 educational program for young people who are

20 interested in film --

21 Q. What does that entail?

22 A. -- called ShortFest, and we run that in June. And

23 young people from all over the country come, and they bring

24 their film. They have all made a film. And we give them the

25 opportunity to put it up on a big screen and meet with people in

26 the industry. And we try to get about 700 of them there --

27 about 600 young people and a hundred industry people, and then

28 they have parties every night and they get to network.


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1 And it's an outstanding -- I mean there are people -- a

2 lot of people who are directing big films that have come through

3 our festival, which is a great thing.

4 Q. So explain to us why there's kind of different arms

5 within -- the film society and the festival and the -- I'm

6 sorry. I forgot what the children's one was called. ShortFest?

7 A. ShortFest. The film society is a membership

8 organization.

9 Q. What does that mean?

10 A. We have about 2500 members.

11 Q. Okay.

12 A. And it's really a combination of a fund-raising entity

13 and a community-outreach entity.

14 Q. Okay.

15 A. You can join it for as little as $40 a year and as much

16 as $4,000 a year, and you get to see films that are screened

17 just for you. I think it's about two a month. And then we

18 have -- there's a higher frequency during awards season when

19 we're showing films before the public gets to see them in many

20 cases, and that structure of 2500 people is very supportive of

21 the film festivals themselves.

22 Q. Yes.

23 A. You know, it's a structure that brings money --

24 additional money into the various -- into the festival, into the

25 awards gala.

26 Q. Sure. So you can maybe use money that comes in from

27 the society and help that to fund projects to generate more

28 income through the nonprofit that then can be used out in the


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1 community? Am I understanding?

2 A. Well, all the money does go into one pot.

3 Q. Okay.

4 A. But what happens is that it's a way of engaging

5 people --

6 Q. Right.

7 A. -- so that when the gala comes, they may be a little

8 more encouraged to buy a $2,000 pass or a $3,000 pass. They're

9 very interested in film or they wouldn't belong to the film

10 society.

11 Q. Okay.

12 A. So, you know, it's in the interests of the festival to

13 attract people who are really passionate about film. And there

14 are people who just love it. They can go see movies every day.

15 They want to know everything there is about film.

16 Other people want to know everything there is about

17 baseball. I want to know everything there is about baseball

18 myself.

19 Q. What's your team?

20 A. The Dodgers. They're having a great year.

21 Q. Thank God. Your blood is blue.

22 A. Nineteen games ahead of the second place team. It's

23 amazing. It is.

24 Q. So we won't talk baseball.

25 Let me go back. You said you have eight full-time

26 employees.

27 What do they do? Do you have a secretary?

28 A. We have eight or nine. We have a director, who's like


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1 a general manager.

2 Q. Okay.

3 A. And then we have an operations manager.

4 Q. Oversees the day-to-day?

5 A. Oversees operations generally.

6 And then we have the creative director --

7 Q. Okay.

8 A. -- who runs a part-time staff that picks films.

9 And then we have a development person.


11 A. It's a person who handles our smaller sponsorships.

12 Q. Okay. Just so we're clear, what's a small sponsorship

13 to you?

14 A. A small sponsorship is an in-kind sponsorship, where

15 someone is giving us $500 worth of sandwiches to use in a green

16 room, or a thousand dollars or $2,000. That's really a small

17 sponsorship. That person would also handle incoming

18 sponsorships if there's a phone call.

19 Q. Sure.

20 A. And they would start out with it, and it would go to

21 someone else in all probability.

22 Q. Okay. And then who else?

23 A. That's a really good question. I'm thinking about

24 these nine people that we have.

25 Oh, we have an education director. He's very good.

26 We have obviously someone at the front desk when people

27 come in.

28 How many we up to? Six?


499

1 Q. About.

2 A. We have a couple more.

3 Q. Do you have an accountant that works full-time?

4 A. I'm sorry?

5 Q. An accountant?

6 A. You know, we have an accountant helping our general

7 manager. That's seven.

8 Q. And then a secretary?

9 A. Well --

10 Q. No? Administrative manager?

11 A. You know, I don't know. But I know it's in that

12 eight-people range. Oh. Well, we have a person that markets

13 the gala.


15 A. They -- she's responsible for ticket sales for the

16 gala.

17 Q. Okay.

18 A. And she's paid full-time because she's very, very good;

19 but I don't know if I call her really full-time. But she's like

20 a full-time person.

21 And then we do have another person -- we have two other

22 people in that department. I only get into that office once or

23 twice a year. I'm sorry --

24 Q. That's okay.

25 A. -- that I don't know all these things.

26 But we do have two other people, one that's involved

27 full-time in the sales of tickets and just kind of marketing

28 generally tickets. And then we have another person who kind of


500

1 is a jack-of-all-trades kind of administrative person that helps

2 with ticket sales and whatever. It's very tiny.

3 Q. Okay.

4 A. And it just blooms once a year. It's incredible.

5 Q. All right. So outside of the film festival -- and,

6 obviously, you, in addition to loving baseball, you love film in

7 that you've done this for so long.

8 A. I don't really love film.

9 Q. No.

10 A. I got involved with this. I'm a John Wayne guy. I'm

11 sure no one here knows John Wayne.

12 Q. Everybody knows John Wayne.

13 A. But I got involved with this because I saved the tennis

14 club.

15 Q. Yes?

16 A. The tennis club had collapsed, and it took a lot of

17 money to bring it back. And I felt it was worth doing that.

18 It's a senior club, and it plays people in their

19 seventies, eighties, and nineties, believe it or not. Probably

20 250 of them are that age, which just amazes me. Mostly

21 seventies. Not too many in their eighties and nineties, but a

22 few. So I rescued that.

23 So when the film festival collapsed, the city came -- I

24 forget who was the mayor then -- but came and talked to me about

25 it. And I'm a marketing person. I understand advertising, I

26 understand branding, and I knew that it could be very important

27 to the city if we really --

28 Q. Kicked it up a notch?


501

1 A. -- developed it. So I put quite a bit of money into

2 it. I think I put probably -- probably 15 or $16 million into

3 it.

4 Q. Into the tennis club?

5 A. Into the film festival.

6 Q. Okay.

7 A. And it really blossomed. I mean, it's really an

8 important -- in Hollywood, it's a very important event. And

9 it's very good for our town. And we feel that it helped bring

10 our town back.

11 Q. Good. So you were talking about how it's not only

12 important to Hollywood but your town. Are the local politicians

13 usually involved in the film festival? Is that kind of an

14 aspect that they're involved in in terms of putting it on,

15 permits and stuff like that?

16 A. Not really.

17 Q. Are they guests? Do they attend?

18 A. Well, the film festival is a City of Palm Springs

19 event.

20 Q. Okay.

21 A. The City created it with Sonny. He was then the mayor.

22 We look at it as though the City owns it.

23 Q. Okay.

24 A. We manage it. They sponsor it.

25 Q. And then what does that mean, Mr. Matzner, "They

26 sponsor it"?

27 A. They are the title sponsor, and they give us $350,000 a

28 year, which they've been doing forever, since it began.


502

1 Q. Has it ever gone up or gone down?

2 A. Once it went up to 400.

3 Q. Do you recall when that was?

4 A. It was around two thousand -- you know, I'm not really

5 sure, but my guess would be 2011. And it went down around two

6 thousand -- no. It went down in 2011, so it had to go up in

7 2009 or something like that -- 2008, 2009.

8 Q. So 2008, 2009 you started getting 400,000, and then it

9 went back to 350,000?

10 A. Yeah, at a point in time. I believe it was in 2011

11 that it went down to that level.

12 Q. Okay.

13 A. Maybe 2010. But right around there.

14 Q. Okay. So do the council, then -- obviously if it's a

15 city event, they attend; correct?

16 A. The city council does have a table and they attend.

17 Q. And the mayor, whoever the mayor is at the time as

18 well?

19 A. Yes.

20 Q. And they don't have any financial interest in this.

21 This is a city-run event, and the purpose of this is to generate

22 income as a nonprofit; correct?

23 A. The purpose of it from their standpoint is to generate

24 branding --

25 Q. Yes.

26 A. -- and exposure.

27 Q. But they themselves, they're not making money off of

28 the actual gala or the actual -- typically? We're gonna head --


503

1 we'll start --

2 A. They are not making any money, no.

3 Q. At some point, though, you did hire someone who was

4 working within the City; right?

5 A. At a point in time we hired the mayor of the city.

6 Q. And there's a group of photographs behind you actually

7 on either side. If you could look to your left.

8 Do you see the former mayor up there?

9 A. That picture of me is very kind.

10 Yes, I do.

11 Q. Okay. And are you referring to the former mayor,

12 Stephen Pougnet?

13 A. Yes.

14 Q. Tell me a little bit about the relationship that you --

15 do you still talk to Mr. Pougnet?

16 A. Do I still talk to him?

17 Q. Yes.

18 A. The last time I talked to Steve Pougnet in any

19 individual way --

20 Q. Sure.

21 A. -- was on May 6th, 2015.

22 Q. Okay. You're very specific about the date.

23 A. Well, I looked up the date.

24 Q. Okay.

25 A. And I brought them with me so I could leave this with

26 you so that you have -- that you know the information I'm using.

27 Q. Okay. Thank you very much for that.

28 So tell me about your relationship with Mr. Pougnet.


504

1 You've been in the city of Palm Springs for a number of years.

2 When did your relationship begin? When did you meet

3 Mr. Pougnet?

4 A. You know, I don't really know that.

5 Q. Okay.

6 A. But I'd known him a long time, liked him very much. I

7 thought he was a superstar. He was a superstar.

8 Q. He was beloved by the city; right?

9 A. Not so much beloved, but he was the most popular person

10 in the city. When he ran for reelection in 2011, he got

11 70 percent of the votes -- actually 66.

12 Q. Is that a big number?

13 A. What was interesting is that six people ran against

14 him. Of those six people, no one got more than 7 percent of the

15 vote. So he got 66 percent, and the next most popular candidate

16 could only get 7 percent.

17 And he deserved it. The man did fabulous things for

18 this community. He was headed for -- I don't know what. I

19 trusted him. I believed in him. I thought he was

20 extraordinary. He had everything anyone needed to succeed in

21 the world big-time.

22 This man could get up and make a state-of-the-city

23 speech perfectly, in a way that compelled your attention,

24 without any notes whatsoever for an hour and a half. Amazing.

25 Q. Let me ask you, then, sir: At what point in time did

26 you think -- well, let me go back.

27 So he ran for mayor in 2011 and won; correct? Yes?

28 A. Yes.


505

1 Q. At some point in time did he have higher aspirations?

2 Did he run for a Congressional seat?

3 A. He did.

4 Q. And he lost -- right? -- to Mrs. Bono; correct?

5 A. He lost to Mary Bono. I think he ran a year too early,

6 but -- I mean, you know, two years too early.

7 Q. Right.

8 A. But he did lose to her. She was very entrenched there.

9 Q. Okay. Did you see him feel -- since you knew him so

10 well, did you see him defeated --

11 A. I was a major supporter of Steve Pougnet.

12 Q. Yes. Did you see him defeated after that loss? Did

13 that impact him significantly?

14 A. You know, I don't think so. I wasn't really too

15 connected with all that when that was going on. I didn't take

16 it seriously.

17 Q. Okay.

18 A. I didn't feel he could win that. I didn't feel he

19 thought he could win that. I felt he was running to try to get

20 on the radar screen beyond Palm Springs. I don't know if that's

21 right or not, but that's what I thought.

22 Q. So at some point, then --

23 A. But I don't think that impacted him in terms of respect

24 for him in the community.

25 Q. Right. But I'm just asking about what you observed

26 with him personally based on your relationship.

27 So let me move on now.

28 So you said that at some point -- well, let me ask you:


506

1 You in fact hired him on to be an employee for the film

2 festival; correct?

3 A. Well, the board of the film festival hired him,

4 although I made that decision with our festival attorney and

5 treasurer, David Baron. The two of us made that decision.

6 Do you want to hear the environment for it?

7 Q. Yes. Yes. So explain to us. Because it's a board,

8 you can't just do as you see fit, you need to have consensus

9 among your board; correct?

10 A. Well, I think I could hire an employee, but would not

11 hire -- I would not hire that employee. I mean, before we hired

12 that employee -- you want this whole story of what happened

13 here?

14 Q. Well, I have to ask questions to elicit the

15 information.

16 A. Okay.

17 Q. So at some point you decided, with your attorney,

18 Mr. Baron, that it would be profitable and beneficial to the

19 organization to have someone like Mayor Pougnet be involved; is

20 that right?

21 A. Well, yes.

22 Q. And part of that is based on what you've already

23 described: He was very well loved and respected and was, like

24 you described him, fantastic within the community; correct?

25 A. Well, not really. I mean, that's a part of it.

26 Q. Okay.

27 A. I mean, Steve Pougnet was a professional fund-raiser

28 before he became mayor.


507

1 Q. And what did he fund-raise --

2 A. And I went to a meeting. I was one of the two leaders

3 of the Measure J effort in Palm Springs.

4 Q. Let me stop you for a moment, Mr. Matzner. Where did

5 he work as a professional fund-raiser before he came --

6 A. Well, I brought his résumé for you. But he worked in

7 Colorado at the University of Colorado School of Mines. Seemed

8 to be there, I think, the longest. But he worked in two or

9 three other educational slots as a fund-raiser.

10 Q. All right. And so based on your knowledge of his

11 experience in the fund-raising industry, and your interview and

12 your discussion with the group, at some point in time does the

13 International Palm Springs Film Festival hire him on?

14 A. Yes.

15 Q. Yes. And was there a contract that was created between

16 the film festival and Mr. Pougnet?

17 A. It was.

18 Q. Yes. And I want to show it to you.

19 We have it marked as People's 53. Are you able to see

20 this screen here, sir? It's kind of not directly in your

21 purview.

22 A. Yes.

23 Q. Thank you.

24 So if you were to look at this from where you're

25 sitting, Mr. Matzner -- I can bring you a copy as well.

26 A. That would be great.

27 Q. Does this look like the contract that you had with

28 Mr. Pougnet?


508

1 A. It is the contract.

2 Q. And it's signed by you on the last page and Mr. Pougnet

3 as well; correct?

4 A. It is.

5 Q. So was this the first time someone who was hired or

6 working in a city capacity also being a paid employee of the

7 film festival?

8 A. It was.

9 Q. So even when Mayor Bono was, you know, starting this

10 film festival, he wasn't financially benefiting from it himself,

11 personally, like in his pocket; correct?

12 A. I hope not.

13 Q. Okay. So you say you hope not because you're not

14 allowed to have a conflict of interest; is that right?

15 A. Yes. Before we hired Mr. Pougnet, we got an opinion

16 from our attorney, we got an opinion from the city attorney, and

17 they're both written.

18 Q. Perfect.

19 A. And we hired Mr. Pougnet after Ginny Foat, a city

20 council person, was hired by Mizell Senior Center about three

21 months earlier. There was quite a bit of publicity to it. And

22 we knew that the city attorney had ruled that that was good.

23 Q. So let me stop you for a second, Mr. Matzner.

24 So there are some circumstances where you're allowed to

25 be an employee for a nonprofit, as long as you take the

26 appropriate steps while you're still on the city council; is

27 that right?

28 A. Absolutely.


509

1 Q. So what would some of those steps entail, based on your

2 knowledge of the legal requirements of hiring someone like this

3 onto your film festival?

4 A. Well, the primary step for Steve, legally speaking, was

5 to recuse himself from anything having to do with the film

6 festival.

7 Q. So let me stop you there, Mr. Matzner.

8 A. And to leave the room when a vote was being taken.

9 Q. Perfect. So what does "recuse" mean? You can't be

10 involved in any aspect of any decisions being made financially

11 for that project?

12 A. But that doesn't work, because the reality is that with

13 a strong mayor like Steve, the rest of those council people know

14 that if he -- if he is supporting something, that he really

15 wants them to support it. So it doesn't matter whether it's the

16 film festival or a piece of land that the festival lost during

17 this swindle that was taking place, but it's just -- the rule

18 doesn't work. Those rules need to be revised. They just

19 don't --

20 Q. So that's your personal opinion?

21 A. Yes.

22 Q. Yes. So let me take this contract from you. Thank you

23 very much.

24 You talked about a swindle. Explain that to us. What

25 do you mean by that?

26 A. Well, I mean -- maybe a "swindle" is not the right

27 word.

28 Q. Okay. Tell us what word you would choose.


510

1 A. Well, I don't really know for sure what word I would

2 choose. We treated Steve very well. We believed in him. We

3 trusted him. We gave him a good opportunity.

4 The fact was he could not have run for mayor, as I

5 understand it, unless he had a job in the community somewhere.

6 Q. And you understand that based on conversations that you

7 had with Mr. Pougnet?

8 A. No. I was at a meeting of about 20 people, regular

9 meeting of this Measure J committee, which ultimately was able

10 to get a sales tax of 1 percent passed in the community. This

11 year it will raise $15.5 million. So it's a very successful

12 thing. And that money was used to move forward and redevelop

13 our downtown area.

14 But at this meeting on this particular day, Steve was

15 there. I don't remember all the people that were there. I was

16 there, David was there. There were 20 people. It was a regular

17 meeting, and there were 21 of them --

18 Q. Let me stop.

19 A. -- during 2011.

20 Q. So we're in 2011. We're talking about Measure J. And

21 just to make sure everyone is following, Measure J was a tax or

22 an incentive that was put to vote to the people about generating

23 money, income, to redevelop the downtown project; correct?

24 A. That's how it was sold to the people, but it was a

25 1 percent sales tax. But in Palm Springs our residents really

26 pay probably 40 percent of a tax like that. sixty percent of

27 our goods are purchased by people from outside of the community.

28 So, you know, it was very salable. And in our town at


511

1 that time, everyone was passionate about redeveloping the

2 downtown area.

3 Q. It was kind of a blighted area; right, sir? It was

4 sad?

5 A. Well, I was executive vice chairman of the museum. I

6 still am. It's a big museum.

7 Q. Is that in the area?

8 A. It's right behind this downtown shopping center that's

9 been out of business for -- it was, at the time, out of business

10 for 20 years.

11 Q. Were you in favor of the development that was proposed

12 by Wessman?

13 A. I was selected by the board of the museum -- a 45-man

14 board -- to represent them in the discussions of the

15 redevelopment and to attempt to get them the best possible

16 exposure, the widest street possible from the main street so

17 people could see the museum, parking for their employees,

18 parking for our events.

19 There were a whole list of things that, you know, that

20 I was advocating --

21 Q. Were those --

22 A. -- on their behalf.

23 Q. So now we know as we sit here today, a lot of that

24 development, although may not be a hundred percent finalized, a

25 lot of it has been completed. Was it done to your liking as it

26 related to the museum?

27 A. Yes. It's a lot better than not having it, and it

28 turned out, given all the circumstances with the indictments of


512

1 city officials and developers and whatever --

2 Q. So I don't want to discuss any details about --

3 A. Okay.

4 Q. -- relating to what may have been heard or seen in

5 papers.

6 That's potentially hearsay, so I want everyone to

7 disregard what was just said.

8 What my question to you is, sir: You had talked about

9 there was a scenario, and you used the word "swindle," even

10 though you said you'd like to change that now.

11 A. I think I would change the word "swindle."

12 Q. Okay. What were you talking about? Was there a

13 parking lot that was of interest to you or the museum that was

14 not given --

15 A. I think I better finish the Measure J meeting thing,

16 because it's really very interesting.

17 Q. Okay. So let me stop you.

18 A. Can I go back to that?

19 Q. Yes, but I have to elicit the question. It's a court

20 rule.

21 A. Okay. Sorry.

22 Q. I could sit and listen to you talk all day. I promise.

23 You're very interesting.

24 Let's go back to the Measure J. I think that's a good

25 point.

26 I want to ask you, was John Wessman there?

27 A. Yes.

28 Q. Was Mayor Pougnet there?


513

1 A. Yes.

2 Q. Was Mr. Ready there?

3 A. No. I never saw Mr. Ready at any of those meetings.

4 Q. All right. What about John Raymond?

5 A. No.

6 Q. Mister --

7 A. I never saw him at any of those meetings either.

8 Q. What about Mr. Lewin?

9 A. Don't know if he was there that day, but he was active

10 in meetings.

11 Q. And he was a council member at that point?

12 A. He was.

13 Q. All right. What about Hutcheson?

14 A. Don't know.

15 Q. Ginny Foat?

16 A. No.

17 Q. Okay. Am I missing anyone? Any other councilmen that

18 were there?

19 A. Well, I'm not even sure that Lewin was there. I may be

20 confusing him with -- we were having a lot of meetings to stop a

21 big jail that was being built.

22 Q. Okay. So let me stop you for a second.

23 A. I believe the only council people that were there

24 were -- there was one other council person there.

25 Can I look at this?

26 Q. No.

27 A. No?

28 Q. During a break you can talk and you can show me.


514

1 A. There was one council person there, and he was at all

2 of these meetings. He was very, very tall.

3 Q. Was that Mr. Mills?

4 A. Yes, Mr. Mills was there.

5 And then, there were probably 15 volunteers -- 15

6 people who were volunteering to help market Measure J and the

7 revitalization of the downtown area to the community.

8 Q. When you say "volunteers," is Mr. Wessman, in your

9 mind, in that atmosphere, is he a volunteer?

10 A. No. John certainly had an interest, and he wanted

11 Measure J to pass so that the city could redevelop his shopping

12 center.

13 Q. So was Mr. Meaney there? Do you know who Mr. Meaney

14 is?

15 A. I do.

16 Q. Was Mr. Meaney at that meeting?

17 A. I don't remember, but I -- I don't know.

18 Q. What other volunteers were there, sir, that you recall

19 that we haven't already named?

20 A. This was 10 years ago.

21 Q. Yes, I know. But you're a very smart man. You have a

22 great memory.

23 A. I'm an 82-year-old man, and I don't want to -- I mean,

24 I could give you a list of -- we can make a list of the people

25 who participated in Measure J --

26 Q. Sure.

27 A. -- and the revitalization and send it to you. But on

28 this day there were about 20 people there with the people you


515

1 named being among them.

2 Q. Okay.

3 A. And Mr. Pougnet started the conversation, which is a

4 bit of a surprise because we were really there to discuss the

5 benefits of this tax to the community, and he said that his

6 partner Chris Green, I think --

7 Q. Okay. His husband; right?

8 A. -- had told him that he could not run for reelection

9 unless he got a job, unless he had a job in the community.

10 Q. Why is that, Mr. Matzner? The mayor, what was his

11 salary?

12 A. The mayor's salary?

13 Q. Yeah.

14 A. Probably 35 or 37 or 38 or something like that.

15 So Mr. Pougnet said, well, you know, "I really can't

16 run unless I find something to do here."

17 And the people in the room -- there was a real estate

18 broker. There were people of means in the room.

19 Q. And when you say a real estate broker, who are you

20 referring to?

21 A. I can't remember his name. Young guy. Very nice and

22 very successful.

23 Q. Okay.

24 A. And so there was a discussion about possible jobs for

25 Steve.

26 Q. So the Measure J meeting turned into how we can get a

27 job for Pougnet?

28 A. Well, it turned into how we could get him to run for


516

1 reelection, which everybody wanted since he was the best mayor,

2 I think, we ever had. And he at that point had not made the

3 horrific decision which he appears to have made later on. He

4 was still high on everybody's pedestal.

5 So did we want him to run for mayor and finish this

6 project that he and Wessman had just agreed to build?

7 Absolutely.

8 And I had talked to him the day before, and he had told

9 me about the desire to work, so I called David Baron.

10 Q. Okay. David Baron is your attorney; right?

11 A. He's the film festival vice chair and the treasurer but

12 also an attorney. And I said, "You know, there are things" --

13 we never had a real development person for the film festival. I

14 did a lot of that myself, and a few of our other key people --

15 key board members did a lot of that -- "you know, this could be

16 a good opportunity for us."

17 Then when I went to the meeting, I saw there was a lot

18 of enthusiasm at the meeting about finding a job for him. David

19 was there. I said, "David, we better grab this guy."

20 Q. Okay.

21 A. So we did.

22 Q. Were you worried that someone else would potentially

23 want him?

24 A. Absolutely.

25 Q. And who else did you think he was a potential prospect

26 for?

27 A. I have no idea, but part of my life is hiring

28 development people. I'm in the process of hiring one right now


517

1 and traveling all around the country. The salary is $300,000.

2 We've done three interviews in the last two weeks, and

3 it's very hard to find someone that is really at a high level of

4 overall excellence, which means totally likable from the

5 beginning, a relationship builder, someone who can make and ask,

6 who is fearless in doing that, and someone who's really

7 strategically bright. And this guy has made some terrible

8 decisions, but he is very bright.

9 Q. So I -- again, I'm going to admonish the jurors to

10 disregard the statement about Mayor Pougnet making terrible

11 decisions. That's your opinion. They're here to determine

12 whether or not certain crimes may or may not have occurred.

13 A. Sorry. I didn't really get that.

14 Q. Okay. I don't want you to influence them. But I do

15 want you to tell us openly, like you've been, about what you

16 actually heard and observed and were a part of.

17 A. So we called him. I don't know if we said anything at

18 that meeting. We called Steve Pougnet the next day, had a

19 meeting with him, and told him that we wanted to hire him.

20 Q. Excuse me. What was -- do you recall, Mr. Matzner --

21 you may not -- what was the salary going to be for Mr. Pougnet

22 at the time?

23 A. You know, we didn't have a salary at that time, I don't

24 think --

25 Q. Okay.

26 A. -- at that time. We talked about what he would do --

27 Q. Okay.

28 A. -- generally.


518

1 Q. What was that?

2 A. Well, our objective was to bring into the awards gala

3 important people that we could not get, for whatever the reason,

4 and we felt he could get.

5 Q. Like?

6 A. Like Donna MacMillan, who was, if I'm the number one

7 philanthropist in that valley, she's the number two. And for

8 some reason she had given us 12,000 in one year, before that had

9 given nothing, and then gave us nothing the following year and

10 the year after.

11 So we were looking for her not for 12,000, we were

12 looking for her for 50,000.

13 Q. Okay. And was the mayor able to secure that donation?

14 A. He was.

15 Q. And were there other donors that you were having him

16 target?

17 A. Yes.

18 Q. Okay. And who were they?

19 A. Well, there were people like Fred Noble.

20 Q. And who was Mr. Noble?

21 A. Mr. Noble -- when you're driving to our city, you see

22 all of these windmills, that is Fred Noble. Very, very

23 intelligent man. Stanford graduate. We had never been able to

24 attract his interest.

25 Q. And he's the owner of Wintec; correct?

26 A. He is.

27 Q. And was Mayor Pougnet able to secure a large donation

28 from him?


519

1 A. He was able to get a $50,000 donation from him. All

2 these donations we've had every year since Mayor Pougnet sold

3 them.

4 Q. But not before?

5 A. But not before, no. We had Mrs. MacMillan for $12,000

6 one year.

7 Q. And what about any Native American tribes?

8 A. We had a Native American tribe for $50,000 in --

9 Q. And just so our record is clear and everyone knows

10 which tribe we're talking about because we're lucky in our

11 county, we have quite a few -- well, not quite a few, but more

12 than maybe other areas of the country. But Agua Caliente;

13 correct?

14 A. Correct.

15 Q. How much were you able -- or how much was Mr. Pougnet

16 able to elicit or get for the film festival?

17 A. He got -- he got them back in. They had been in, and

18 they left for three years as far as a real sponsorship is

19 concerned.

20 Q. Sure.

21 A. The casino was buying -- each casino was buying a table

22 for 10,000, I believe.

23 Q. Sure.

24 A. But the chairman of the tribe had decided not to

25 sponsor the festival, and Steve was able to get them back in in

26 2014 and '15 for $50,000, in 2016 for $75,000, although he was

27 not being paid in 2016.

28 Q. By the film festival?


520

1 A. By the festival. He actually left in 2015, in May,

2 when he decided not to run.

3 Q. Okay.

4 A. He left as a festival employee but stayed on the

5 payroll, I think, for four -- through the month of September.

6 Q. Now, was the money in which -- so you're talking about

7 these donations over a period of years. What year was it that

8 Mr. Pougnet started at the film festival? Was that 2012?

9 A. Well, he sold Wintec. We had the benefit of Wintec in

10 2011. Let's think about that. We had the benefit of Wintec for

11 the January 2012 film festival. So that was really before he

12 started.

13 Q. Okay. Because your contract starts with him

14 January 1st of 2012; correct?

15 A. It was signed in February, February 13th. So in our

16 view it really didn't start until February.

17 Q. Okay.

18 A. But our legal counsel felt that it was fair to pay him

19 one month's pay for the Wintec that he had sold in December of

20 2011, so we did pay him money in January.

21 Q. So it says here, subsection (2), that -- where it talks

22 about consultant agrees as follows, and it talks about

23 compensation, that he was paid 12,500 per month.

24 Is that correct, Mr. Matzner?

25 A. That is what he initially was paid.

26 Q. Okay.

27 A. Which is a fair salary for an experienced, capable

28 fund-raiser. You really can't hire one for that. You really


521

1 would normally be hiring them for $200,000, if he worked

2 full-time.

3 Q. Let me ask you this: He obviously wasn't working

4 full-time because he was also the mayor. He worked a lot for

5 you?

6 A. I would have to say if I was mayor and I got that

7 opportunity, that would be a full-time job. And I thought that

8 he would put more time into it than he did. If you read the

9 contract, it's a pretty complete contract.

10 Q. Okay.

11 A. And, of course, it gave us, from the very beginning,

12 the ability to cancel it immediately, and it was self-funded,

13 which meant that he had to earn at least as much money as he was

14 paid.

15 Q. So he wasn't paid necessarily, then, until a donation

16 came in?

17 A. No. He was paid based on sales. He wasn't on

18 commission, and he was paid based on sales. He sold more than

19 those particular three accounts. He worked on a lot of

20 accounts, and he supplied some management, and we made money

21 with it. I mean --

22 Q. So I want to stop you. We've talked about a lot of

23 things, and I don't want to forget to go back.

24 So you were telling us before about this Measure J

25 meeting and about how, you know, he was talking about how he

26 needed to get another job because his husband said he couldn't

27 stay as mayor. Was Mr. Noble there at that meeting, too?

28 A. No.


522

1 Q. What about Donna MacMillan?

2 A. No.

3 Q. What about anyone from the Agua Caliente tribe?

4 A. No.

5 Q. What was it that happened that caused you to be unhappy

6 with Mr. Pougnet relating to the downtown project? I want

7 you -- you haven't told us yet. You said you wanted to change

8 the word "swindle," but what happened?

9 A. Well --

10 Q. Was there a parking lot that was supposed to go to the

11 museum?

12 A. Well, there's --

13 Q. Or the film festival?

14 A. There's a parking lot. Well, there's a guy named Rich

15 Meaney.

16 Q. Rich Meaney was very close to Pougnet; right?

17 A. Yes.

18 Q. Did you go to Rich's wedding?

19 A. Did I do what?

20 Q. Well, a lot of people were there.

21 A. No, I did not go to his wedding. I've never eaten with

22 him. I've never been anywhere with him.

23 Q. Okay. Not your cup of tea?

24 A. Not my cup of tea, and I don't think he was Steve's cup

25 of tea. I'm not sure how that evolved, whatever that was.

26 Q. All right. So we'll leave that.

27 Tell me what happened with the parking lot.

28 A. You know, I didn't want to leave you with the


523

1 impression that this was all about Steve getting a job at the

2 Measure J meeting.

3 Q. We'll go back.

4 A. It was more about getting Steve to run for mayor.

5 Q. You're very --

6 A. I mean, we were -- everybody sitting in that room that

7 were community activists, and that's really what they were for

8 the most part --

9 Q. I think it's very clear to everyone, sir, that you were

10 passionate about his work as mayor, and that impression isn't

11 left behind. So I do want to focus on the parking lot, though,

12 if we can.

13 So what happened?

14 A. What happened with this parking lot is incredible. I

15 mean, Steve is working for the film festival. And, I mean, he

16 is a guy that -- I mean, we worked closely for years doing lots

17 of good things for the city. And very high regard for him.

18 Brought him in. Little disappointed he didn't work harder. But

19 he had so much darn ability that he could be successful without

20 working as hard as many of us would have to work at doing what

21 we were asking him to do. So he made us money. We're still

22 making money. This year we got $200,000 from what he sold.

23 It's a hundred percent profit. And somewhere along the line

24 here he supported the idea of Rich Meaney getting a six-acre

25 parking lot.

26 Q. That's a lot of land -- right? -- in that downtown

27 area, six acres?

28 A. It's critical. It's adjacent to the convention center.


524

1 We run our big gala at the convention center. There's no other

2 place big enough to handle it in the whole valley.

3 And a key to all of this is, you know, many -- much of

4 our money comes from older people, and they need to be able to

5 valet park their car and, you know, we have to handle them in a

6 certain way.

7 And that lot, that six-acre lot, was zoned for hotels.

8 Now, if a hotel was built, we would have lost our parking for a

9 year or year and a half while that hotel was being built, but

10 the hotel was required to provide a 400-car garage. So we would

11 have had more cars at the end than we had -- you know, the way

12 this went down was mind-boggling.

13 Q. What happened?

14 A. Mr. Pougnet quietly supported -- without ever

15 discussing it with me, without ever saying, "Harold, by the way,

16 the City is moving forward with this project. Do you want to

17 come down and appear before the council and give them your

18 opinion?" -- he supported selling this lot to Rich Meaney's

19 company, Nexus, for, I think, $1,200,000.

20 Q. Did you think that was not the value of the lot?

21 A. I thought that was not the value of the lot.

22 Q. What would you have paid for that lot?

23 A. A lot more than a million dollars.

24 Q. Tell me.

25 A. Four million.

26 Q. Okay.

27 A. I mean -- and I probably would have paid more than

28 that, but I'd be buying it as a nonprofit for the film festival


525

1 and allowing other people to use it.

2 But that's not even the matter of value in this

3 instance. It's a matter of it should not have been sold to Rich

4 Meaney. It was essential to the convention center. It wasn't

5 in the city's interest.

6 In my opinion, a kid in seventh grade could see that.

7 I mean, anyone could see that. I have no idea what these other

8 council members were thinking about, except that he was their

9 leader.

10 Q. And he may have convinced them --

11 A. I had heard that he threatened Paul Lewin.

12 Q. Well, let's stop.

13 Disregard that as well.

14 A. Why would they disregard that? That wasn't in the

15 paper.

16 Q. I know, sir, but you didn't actually hear it; correct?

17 A. No, I did not hear that.

18 Q. So I can't have you testify to hearsay.

19 A. Okay.

20 Q. I can't. I'm sorry. It's just the rules.

21 A. No. I'm sorry.

22 This is the first time I've ever been with a grand

23 jury. This is a fine-looking group of people, too.

24 Q. We think so, too.

25 MS. BARAJAS: So do we need a break?

26 THE COURT REPORTER: I would like to have a break.

27 MS. BARAJAS: How much time do you want?

28 THE COURT REPORTER: Fifteen.


526

1 MS. BARAJAS: Is that okay, everyone? We'll take a

2 15-minute break.

3 GRAND JURY FOREPERSON: Before we break, I need to

4 admonish you as a witness.

5 You are admonished not to reveal to any person, except

6 as directed by the court, what questions you were asked or what

7 responses were given or any other matters concerning the nature

8 or subject of the grand jury investigation which you've learned

9 during your appearance before the grand jury unless and until

10 such time as a transcript of this grand jury proceeding is made

11 public. A violation of this admonition is punishable as

12 contempt of court.

13 And with that, I would let the grand jury know you're

14 still admonished as earlier today, and we will break till 20

15 till.

16 MS. BARAJAS: Sure.

17 GRAND JURY FOREPERSON: So 20 to 11:00 we'll take a

18 break. Thank you.


20 (Recess.)

21 GRAND JURY FOREPERSON: The grand jury will now come to

22 order. The record will reflect all 19 jurors are present.



25 Q. BY MS. BARAJAS: So we left off, you were talking about

26 Mr. Pougnet working for the film festival.

27 A question that we received from one of the grand

28 jurors asked: When you paid Mayor Pougnet, did you actually pay


527

1 him individually, or were you paying like Pougnet and

2 Associates? Did he bill the film festival, Pougnet and

3 Associates?

4 A. I don't know how we paid him in the beginning, but I

5 know that after a point in time, I believe we were paying

6 Pougnet and Associates. And at a point in time, since the

7 contract said that it was a requirement that it be self-funding,

8 we -- David Baron and I called Steve in, we talked to him and

9 explained to him that we were cutting his salary in half.

10 Q. Why was that?

11 A. He didn't sell enough for us to make a profit, and we

12 were committed -- by self-funding, we felt that the festival had

13 to make a significant amount of money, at least as much money as

14 he was making, so we cut him down to --

15 Q. Go ahead. Finish your thought.

16 A. -- $75,000 from 150,000.

17 So for the first year he actually averaged $8100 a

18 month or $97,000. Year number two he was at a straight $75,000.

19 That's what he was paid from that point on, because he never

20 really increased beyond that point. We had hoped that he would

21 be applying himself a little more.

22 Q. So you talked about Wintec, 50,000; 50,000 from Donna;

23 50 from the -- 75 from the --

24 A. Fifty from the tribe until -- really, Steve sold it,

25 but then Steve left, so we got -- that would be in 2016, the

26 75,000. So I think 25,000 from the company that provided the

27 garbage removal in the city.

28 Q. The waste?


528

1 A. I forget the name of that company.

2 Q. Palm Springs Waste --

3 A. Disposal.

4 Q. -- Disposal.

5 A. So he had 200,000 there, and then he had other little

6 things, five from Virgin Airlines and other minor things.

7 Q. 5,000?

8 A. 5,000.

9 He did work Wells Fargo up to 100,000 from 50,000. He

10 played a role in that. He did a whole bunch of e-mails that

11 show his involvement, but we really didn't think of that as his

12 account, so we didn't internally give him credit for it.

13 Q. So how much did you give him credit for that first

14 year?

15 A. The first year we gave him credit for -- that's a good

16 question -- for $105,000.

17 Q. All right. So for bringing in 105, you just said right

18 now he made --

19 A. Ninety-seven.

20 Q. That's a good gig; right?

21 A. Well, that's why we cut his salary in half, so you just

22 answered your own question.

23 Q. So did Mr. Wessman ever donate to the film festival,

24 too?

25 A. Yes.

26 Q. Was he someone that Pougnet got credit for, or was he

27 just an ongoing donor?

28 A. Mr. Wessman, I believe, was one of the founding donors


529

1 of the film festival and went all the way back to Sonny Bono and

2 had been on that board the entire time.

3 Q. So he's always --

4 A. I think.

5 Q. He's always donated?

6 A. He was there when I got there.

7 Q. What's your relationship like with Mr. Wessman?

8 A. Better than most people.

9 Q. Is he difficult to get along with?

10 A. John is his own person. He's a very unusual person.

11 Q. Okay.

12 A. He rode into town with a carpenter's bag, a tool kit in

13 the back of his beat-up car, and 35 years later or 40 years

14 later, owned more property than anybody else in that town.

15 Q. Would you describe Mr. Wessman as --

16 A. Rough and tough.

17 Q. Yes.

18 A. And unusual.

19 Q. Would you also agree that Mr. Wessman is -- owns a lot

20 financially in Palm Springs?

21 A. Owned a lot?

22 Q. Owns?

23 A. He owns more property than anyone in Palm Springs

24 except the tribe.

25 Q. Okay. So now --

26 A. And I always respected that. You know, you start with

27 nothing and he fought his way up. You can see the scars all

28 over him in the way he deals with other people, but at the same


530

1 time that helped shape his character. And he's a tough guy.

2 Q. Let's talk about your relationship with Mr. Wessman for

3 just a moment.

4 You still speak with him? He's still on the board;

5 correct?

6 A. I do not speak with him.

7 Q. Okay.

8 A. I have run into him, but I don't speak with him.

9 Q. Have you ever had an opportunity to speak with him

10 about this case?

11 A. I don't speak about this case.

12 Q. All right. Were you ever contacted or have

13 conversations with his attorney?

14 A. His attorney contacted us. He didn't contact me.

15 Q. Okay.

16 A. But he did contact my attorney.

17 Q. Do you know what the name of that attorney was?

18 A. He's in Palm Springs, I think.

19 Q. Is it Mr. Rod Soda?

20 A. I don't know that for sure, but I think so.

21 Q. Okay.

22 A. And he just said that he wanted to talk to us if we

23 were going to talk to you.

24 Q. Okay.

25 A. And, no, I didn't agree to do that.

26 Q. All right. So, now, tell me about any business

27 relationships that you had with Mr. Wessman prior to all of this

28 coming out about Mr. Pougnet. Did the film festival -- other


531

1 than donations that Mr. Wessman gave, was there any other

2 financial connections to Wessman Development?

3 A. Okay. I personally have never had a business

4 relationship with John Wessman.

5 Q. Okay.

6 A. Ever.

7 Q. What about the film festival?

8 A. The film festival -- when I took over the film

9 festival --

10 Q. Yes.

11 A. -- the film festival was renting a building from John

12 Wessman.

13 Q. And that's on what street? Is that Tahquitz?

14 A. It's tucked away behind one of those -- one of the

15 Mexican fast-food places. What street is that? It's on Sunrise

16 and Tahquitz.

17 Q. Tahquitz. And you paid rent every month for that

18 space; correct?

19 A. We do.

20 Q. Even today?

21 A. Even today.

22 Q. Okay. And that's owned by Mr. Wessman?

23 A. Yes.

24 Q. When you first moved into that space, when was that?

25 Do you recall?

26 A. I wasn't there. I mean, that building was there and

27 the relationship with Wessman was there when I got there, and --

28 Q. So --


532

1 A. -- we've been trying to move for the last five years.

2 We just haven't been able to make that work.

3 We bought two different buildings, and they just

4 haven't worked out for us. We haven't been able to rebuild

5 them.

6 Q. Let me go back.

7 The relationship where the film festival was renting

8 space from Mr. Wessman, that was prior to you being chairman?

9 A. Yes.

10 Q. So the film festival has had that particular location

11 since Mr. Bono?

12 A. It could be. I don't know anything about that.

13 Q. At some point in time did you have that location

14 renovated?

15 A. No.

16 Q. Was Mr. Meaney ever involved in any renovation to a

17 space relating to the film festival?

18 A. At a point in time we were trying to escape the

19 building. It's not a very nice building. Our people deserve

20 better. We just have not been able -- believe it or not, in

21 Palm Springs there just isn't a lot of choices.

22 And Mr. Meaney was going to rebuild the four buildings

23 that sit on Tahquitz that face Tahquitz that are a part of the

24 property called Aberdeen, which also includes the parking lot,

25 which is something I did not know. I learned that --

26 Q. Later?

27 A. -- later.

28 Q. That's the same parking lot at issue that was upsetting


533

1 to you that was sold to Mr. Meaney?

2 A. The same parking lot that was, yes, sold to Mr. Meaney.

3 Q. So whatever happened with that?

4 A. The building or the parking lot?

5 Q. The parking lot. Did it ever become the hotel? Did

6 you lose the parking lot?

7 A. No. Well, they bought it, and the City filed suit

8 under 1090 to reclaim it.

9 Q. Okay. Disregard the civil suit discussion.

10 I just wanted to know, at some point in time after

11 the --

12 A. We were fighting -- we're going to file a lawsuit

13 ourselves for that property if we have to. I mean, the film

14 festival will fight for that property because it's essential to

15 our ability to operate the gala.

16 Q. Okay. I'm glad you said that. I have a question about

17 that, then.

18 So would that create any bias for you, as you sit here

19 today, in not telling the truth one way or the other because

20 you're upset about losing that property?

21 A. I always tell the truth.

22 Q. Okay. So you're not upset with Pougnet and making

23 stuff up about Pougnet?

24 A. I am very angry at Pougnet, and right now I'm just sad

25 about him. And I feel really sorry for him. The guy made a

26 couple bad decisions that destroyed his entire life.

27 Q. Let's disregard about destroying his entire life.

28 You're admonished not to take that into consideration.


534

1 Let's focus now on the property dealings.

2 So the rent for the Tahquitz -- and forgive me if I'm

3 mispronouncing that -- how much does the film festival pay to

4 Mr. Wessman per month?

5 A. I think it's about $8,000 a month.

6 Q. And how large is the space? What's the square footage?

7 A. It's about 6,000 feet.

8 Q. Is that common pricing for that area, that location?

9 A. I think it's a little high.

10 Q. Okay. So you have -- there's that financial

11 connection.

12 Any other -- when you pay the rent every month, did the

13 check say to Wessman Development, or was there a way to specify

14 that it was specific for the property? It says Tahquitz rental;

15 correct?

16 A. You know, I've never seen the check. I'm just not that

17 close to it.

18 Q. Now, is there any reason that we haven't already

19 discussed, where there would be a payment to Mr. Wessman or

20 Wessman Development for something?

21 A. I'm sorry?

22 Q. So other than the rent, is there any other -- and the

23 donation from Mr. Wessman to the festival, are there any other

24 financial connections between Wessman Development and the film

25 festival?

26 A. No.

27 Q. So there wouldn't be any reason why the film festival

28 would write a check to Mr. Wessman that you could think of?


535

1 A. I can't think of a reason why we would write a check to

2 Mr. Wessman.

3 Q. Okay. So now let's move on. Let's focus on

4 Mr. Pougnet.

5 A. At a point in time the festival may have sent him back

6 a donation.

7 Q. Okay. We'll talk about that in a moment.

8 So we -- well, let's talk about it now.

9 Why would you send back a donation?

10 A. You know, I don't know that. I mean, I have to kind of

11 send that to you, but my mind is saying to me that at a point in

12 time when the newspapers started writing articles about --

13 Can I discuss this?

14 Q. Well, if it influenced -- I don't want you to discuss

15 what the newspaper said, but at some point in time you felt it

16 necessary to give a check back?

17 A. Well, I think there was a point in time when we decided

18 to give a check back.

19 Q. Let's talk about it, then.

20 A. I just have a hard time talking about it because I

21 don't remember it except I think it's possible.

22 Q. Okay. You have a great memory, Mr. Matzner.

23 A. This is 82-year-old equipment.

24 Q. It's running smoothly.

25 So let's focus on People's 66. So we are looking at

26 page 1.

27 Do you have it up there? I have an amazing technical

28 administrative executive.


536

1 So every year the film festival has to do a

2 reconciliation of finances; right?

3 A. Yes.

4 Q. I'm going to use this candy cane.

5 So this reconciliation is for the year of 2012;

6 correct?

7 A. You know, I can't really see it.

8 Q. Okay. I'll bring it to you.

9 A. Sorry.

10 Q. No. That's okay. I can barely see it, too.

11 That's for 2012?

12 A. 2012, yes.

13 Q. I'll go over it with you first before we show the

14 jurors.

15 So we see a payment received in January --

16 A. Yes.

17 Q. -- from Mr. Wessman or Wessman Development in the

18 amount of 75,000; correct?

19 A. Yes.

20 Q. And let me take you to --

21 A. Did we return it?

22 Q. Well --

23 A. I think that's what I'm remembering.

24 Q. Okay. So then in May of 2012, we see a check; and,

25 again, this is disbursements -- right? -- from the film

26 festival. It says minus. So there's a check, May 30th of 2012,

27 that's sent to Wessman Development in the exact same amount of

28 75,000.


537

1 A. Uh-huh.

2 Q. Why do you think that is?

3 A. Well, I think there's a possibility that we decided not

4 to accept it, but I'm not sure why.

5 Q. Okay.

6 A. But I can find out and send you information about it.

7 Q. So just so the jurors can see what I showed you now, we

8 see a payment here in January of 2012, and the payment is from

9 Wessman Development, and it shows a gain to the festival of

10 $75,000.

11 And then on page 3 of this document, we see here now

12 that this is money leaving the account, and there is a payment,

13 May 30th of 2012, and the check is from the film festival to

14 Wessman Development for that exact same amount; right?

15 A. Well, absolutely.

16 Q. And this is a ledger that you're -- not that you're --

17 but that the festival puts together? This isn't a ledger that

18 is created --

19 A. I'm sure that happened.

20 Q. Okay. All right. Now, at some point, then, the

21 relationship with Pougnet and him working for the festival ends.

22 What year was that?

23 A. It ended in 2015 in May.

24 Q. Okay.

25 A. I believe on May 6th.

26 Do you want me to get information on what that $75,000

27 rebate was?

28 Q. We can talk about that more at a later time. I want to


538

1 talk more about now Prairie Schooner, Aberdeen.

2 So there was controversy about the parking lot that

3 you've described in relation to the museum. Were there any

4 other projects that you were hoping for or advocating for in

5 that downtown area?

6 A. Well, the revitalization of downtown was a 16-acre

7 project, and it really was the face of downtown, made up of many

8 different parts. So I was advocating for that or for a park.

9 Q. Were you also interested in potentially there being

10 another theater in downtown?

11 A. Well, we would take it if it came. I mean, it's --

12 it's, um --

13 Q. That would fall in line with the mission of what the

14 film festival does, the gala being there, and the convention

15 center? That would have been something --

16 A. You know, on balance, is that something that we would

17 really be involved in? We would not be advocating to build a

18 theater in that shopping center. If that's something John

19 wanted to do way back in the beginning -- you know, there have

20 been a lot of iterations of that shopping center.

21 Q. When you say there is "a lot of iterations," do you

22 mean the design of it and what was going to be there has changed

23 over the years?

24 A. Yeah, and the name of it. It was the Museum Plaza to

25 begin with.

26 Q. Which would have made the museum the main focus?

27 A. Yeah. We would have liked that. It would have been

28 good for us.


539

1 Q. At some point, then, there was talk -- you recall there

2 were talks about a theater going in downtown?

3 A. I didn't recall that until you mentioned it.

4 Q. Right.

5 A. It was completely remote, and it was just talk. John

6 was talking about building a bowling alley and a theater.

7 Q. Okay.

8 A. But it was talk. It never got anywhere, and we were

9 not strongly supportive of that.

10 Q. Okay. But it would have been something you liked as

11 well; correct?

12 A. Maybe not.

13 Q. Why?

14 A. I wouldn't say that that is something we would have

15 liked. The film festival is built around the branding idea --

16 Q. Yes.

17 A. -- of having every single screen in the city. So we

18 run 22 screens for that festival, and we control them.

19 Q. As you --

20 A. And I'm not sure that we would have been excited about

21 John building a theater that had 14 screens and them worrying

22 about what was going to happen during our festival.

23 So it's not all, you know --

24 Q. That was at the time. As you look back now you say

25 that, but at the time was it something you were willing and

26 interested in discussing?

27 A. We made no effort to do that that I can recall.

28 Q. Okay. Now, we've had you talk about the relationship


540

1 with the mayor and his efforts with the film festival.

2 As you understood it, whenever there was discussion

3 about the film festival, he was required to recuse himself when

4 he was working with the City; correct?

5 A. Yes.

6 Q. And you even had those discussions with your attorney,

7 David Baron, and with the mayor as well; correct?

8 A. And with the city attorney.

9 Q. Okay. So it was well known -- hey, everybody --

10 everybody in Palm Springs -- everybody knew that the mayor was

11 working in some capacity for the film festival?

12 A. It was a front-page story in the daily newspaper.

13 Q. And as far as you know, every time there was a vote,

14 every time there was discussion about it, he recused himself;

15 correct?

16 A. I don't believe there were any votes. I mean, we would

17 not do that again. It's complicated to employ a city employee

18 in a place where you have any kind of business, any kind of

19 nonprofit business, because you can't go to the City and ask

20 them for money. You can't ask them for anything.

21 So we didn't count on Mr. Pougnet recusing himself, we

22 simply did not go to the council for anything during those three

23 or four years that he worked for us. And it makes you really

24 uncomfortable because, first of all, it just doesn't work. So

25 he'd leave the room and every councilman knows that he works for

26 the film festival or whatever he's advocating, and they support

27 it.

28 Q. So --


541

1 A. So we asked for nothing new during that entire period

2 of time.

3 Q. And, in fact, you had noted earlier that the amount

4 that was actually donated may have decreased; correct?

5 A. Well, it decreased before --

6 Q. He took the job?

7 A. -- Steve came aboard.

8 Q. Okay. Have you been honest with us today, sir?

9 A. So far. Yes, I have been honest with you.

10 Q. Thank you for being with us. If there are no other

11 questions from the jurors, I have nothing further.

12 It was a pleasure to meet you.

13 GRAND JURY FOREPERSON: Before you leave, I need to

14 admonish you again.

15 You are admonished not to discuss at any time outside

16 of this jury room the questions that have been asked of you in

17 regard to this matter or your answers until authorized by this

18 grand jury or the court or until such time as these grand jury

19 proceedings become a matter of public record.

20 You will understand that a violation of these

21 instructions on your part may be the basis for a charge against

22 you of contempt of court.

23 This admonition, of course, does not preclude you from

24 discussing your legal rights with any legally employed attorney

25 representing you, should you feel that your personal rights are

26 in any way in jeopardy.

27 Do you understand?



542

1 GRAND JURY FOREPERSON: Thank you. You are excused.

2 THE WITNESS: Thank you.

3 MS. BARAJAS: Our next witness will be Mr. George

4 Marantz.

5 Are you good right here, sir?

6 THE WITNESS: I'm fine right here.

7 GRAND JURY FOREPERSON: Please raise your right hand.





12 GRAND JURY FOREPERSON: I have a statement

13 acknowledging a secrecy order that I would like you to read it

14 to yourself, then sign and print your name and date it at the

15 bottom.

16 THE WITNESS: What's the date today?

17 GRAND JURY FOREPERSON: The 13th.

18 Please state and spell your full name for the record.

19 THE WITNESS: George Arlen Marantz. George,

20 G-e-o-r-g-e M-a-r-a-n-t-z. Arlen is the middle name, A-r-l-e-n.



23 GEORGE ARLEN MARANTZ,


25 follows:


27 BY MS. BARAJAS:

28 Q. Good morning, Mr. Marantz.


543

1 A. Good morning.

2 Q. How are you doing, sir?

3 A. Fine.

4 Q. As we were walking you in, sir, you passed by a

5 gentleman. Do you know who that is, the gentleman that we

6 passed?

7 A. You mean Harold?

8 Q. Yes, sir.

9 A. Yes. We have dinner together every Tuesday night.

10 Q. And how long have you known Mr. Matzner?

11 A. Ten years, maybe.

12 Q. Would you -- how would you describe your relationship

13 with him?

14 A. It's just social, a social relationship.

15 Q. Friends?

16 A. Yeah. Not really -- yeah, we're friends, I guess.

17 Q. You have dinner every Tuesday night.

18 A. Well, that doesn't make us friends.

19 Q. What do you talk about?

20 A. We're friends. Would I call him in the middle of the

21 night because I have a flat tire, and the answer is no. That's

22 a real friend.

23 Q. Okay. I agree.

24 A. Would I call him if I needed to borrow some money, yes.

25 And he would loan it to me. So which is a friend, a flat tire

26 or the guy that loans you the money?

27 Q. Sometimes both. Depends on your needs; right?

28 Who else goes to your dinners, sir?


544

1 A. There's about 12 people, 12 individuals.

2 Q. Who else?

3 A. You want me to give you names?

4 Q. Yes.

5 A. I have a problem with names. If you ask me a name from

6 10 years ago, not a problem, or 20; but names right now -- one

7 of them would be -- really, it's not Alzheimer's. I have a

8 problem. Bob Fey is one of them. Michael Lansing is one of

9 them. Fred Razzar is one of them. None of them have anything

10 to do with the suit, by the way.

11 Q. When you talk about the suit, you mean --

12 A. None of these boys have anything to do with it.

13 Q. So let's talk about --

14 A. Except for Mr. Matzner.

15 Q. Did you say Mr. Matzner?

16 A. Yes. And why he's involved, I cannot figure out, but

17 that's not for me to ask.

18 Q. Thank you. I appreciate you not asking.

19 So let's talk about what you do for a living, sir, or

20 what you did for a living. You still own your company; right?

21 A. Yes.

22 Q. And what company is that?

23 A. It's called G & M Construction.

24 Q. And how long have you had G & M Construction?

25 A. Since inception.

26 Q. Which was?

27 A. Twenty years ago.

28 Q. And have you done work in the city of Palm Springs?


545

1 A. We did and do. We do work to this day.

2 Q. To this day. Any other businesses that you have, sir?

3 A. Yes. I built a mobile home park. I built a

4 recreational vehicle park, and then I built another recreational

5 vehicle park, and I owned a restaurant.

6 Q. And what is the name of the mobile home park?

7 A. Parkview Mobile Estates.

8 Q. And which one is the recreational one?

9 A. Happy Traveler Recreational Vehicle Park.

10 Q. Are all of those businesses, Mr. Marantz, still open

11 and ongoing today?

12 A. Yes.

13 Q. And you still own them?

14 A. No. I sold them.

15 Q. So what do you still own?

16 A. Basically nothing. I've sold everything.

17 Q. Except for G & M?

18 A. Except for the construction company, and I don't really

19 own that. My superintendent and my secretary own it now. They

20 just let me sign the checks.

21 Q. All right. So you have a great sense of humor; right,

22 Mr. Marantz?

23 A. Theoretically, yes.

24 Q. Theoretically. So your secretary, she's actually here

25 with you?

26 A. Yes, she is. I think you've called her.

27 Q. What's her name?

28 A. Renee Breiling.


546

1 Q. Now, I want to talk to you about your relationship that

2 you had with Mr. Pougnet. Were you ever friends with

3 Mr. Pougnet?

4 A. Yes. We were very close friends at one time.

5 Q. And what year was that that you became very close

6 friends?

7 A. You're asking me -- as I say, my mind isn't that well.

8 It goes back about 10 years ago -- 10, 12 years ago.

9 Q. And how did you first come to know Pougnet?

10 A. I think he probably came by my office originally. I

11 did not support him for his campaign. So the second time I did,

12 but not the first time.

13 Q. So he came asking for money, then?

14 A. No.

15 Q. The first time he just came to meet you?

16 A. First several times.

17 Q. Okay. At some point in time you started giving

18 Mr. Pougnet money; right?

19 A. Yes. At one point in time he asked me -- he was a

20 little bit short, so I wrote him a check.

21 Q. Do you recall how much that check was for?

22 A. Probably $2,000.

23 Q. Do you have those available?

24 Mr. Marantz, can you see the screen here, sir?

25 A. Yes.

26 Q. Give it a second.

27 We see a check here, sir, and it says, "Happy Traveler

28 RV Park."


547

1 A. That's from the RV park, yes.

2 Q. And is that your signature on the check, or did someone

3 else --

4 A. Absolutely my signature.

5 Q. And it says, "Cash." Why does it say, "Cash"?

6 A. Because he was going to cash the check and take the

7 money.

8 Q. Okay. But it doesn't say anything on the memo line

9 about it being for a campaign donation; right?

10 A. It was not a campaign donation.

11 Q. So this was in the year of 2014; correct, sir?

12 A. I'll buy that, yeah, if that's what it says.

13 Q. Well, you have to tell me, sir.

14 A. Yes, 2014.

15 Q. And that's Exhibit No. 39, for the record.

16 And we see here a signature, and you're saying you

17 wrote that signature?

18 A. That's my signature. It's sloppy.

19 Q. All right. Let's move on to the next check.

20 We see another check here, again from Happy Traveler RV

21 Park, Inc., again, cash.

22 A. One of my companies.

23 Q. All right. And it doesn't say "campaign donation";

24 right?

25 A. No, it's not.

26 Q. And it's for $5,000?

27 A. It was a lot of money I gave him.

28 Q. You were generous that time?


548

1 A. I was generous that time. He must have really been

2 short.

3 Q. That was in 2012?

4 A. Yeah. 2012? I thought the other was 2014?

5 Q. Yes, 2014.

6 A. You're mixing them up. Okay. They're not

7 chronological.

8 Q. No. Forgive me.

9 So this is People's 39. We're going through a series

10 of checks.

11 Do you remember the circumstances surrounding --

12 A. No, I do not.

13 Q. Let's move on. Same exhibit.

14 We see this is a personal check, looks like anyways.

15 Is that correct, sir?

16 A. If it says George Marantz on it, it's personal. Number

17 6 Palomino?

18 Q. Yes, sir.

19 A. That's my personal check.

20 Q. This is in May of 2013; correct?

21 A. All right.

22 Q. Is that a yes?

23 A. Yes.

24 Q. And it's for the amount of 2,500; correct?

25 A. That sounds like a good figure.

26 Q. Is that accurate?

27 A. Yes.

28 Q. And, again, we see it's for cash?


549

1 A. Yes.

2 Q. This handwriting looks a little bit different. Did you

3 actually write that check out?

4 A. Who remembers?

5 Q. Who remembers. Does that look like your writing, sir?

6 A. The signature is mine, the writing does not look like

7 mine.

8 Q. Is that writing Renee's?

9 A. It's probably Renee's, yes, or my wife's. Could have

10 been my wife's. What is the address on that, Number 6?

11 Q. Yes.

12 A. My wife's.

13 Q. So now we're looking at another check dated June of

14 2013. This one is for 2,500 again; correct?

15 A. Yes.

16 Q. And we see again it's written to cash?

17 A. Uh-huh.

18 Q. And it's 2500?

19 A. Yeah.

20 Q. And that's your signature?


22 Q. Moving to the next check.

23 So this writing is different on this check.

24 Is that your writing?

25 A. That's mine because it's block writing. Yeah, I can't

26 write very well.

27 Q. And it's distinguishable; correct?

28 A. Yes.


550

1 Q. That's your signature still?

2 A. Yes, it is.

3 Q. And, again, we see here that you wrote a check for

4 2,500.

5 A. Okay.

6 Q. Is that accurate?

7 A. I'll buy that.

8 Q. Is that a yes?

9 A. Yes.

10 Q. And in December of 2013; correct?

11 A. That's my handwriting up there, yeah. Sloppy.

12 Q. That's the correct date; correct?

13 A. That's correct, if that's what you say.

14 Q. No, sir. It's what you see?

15 A. What I see is what you said, yes.

16 Q. Now, again, it says, "Cash," nothing on the memo line.

17 What was it for? Every month you gave him money; right?

18 A. Not every month. Every once in a while. Every couple

19 months. He basically -- it was like a gift. It was a gift. I

20 do that with other people also.

21 Q. You're very giving; correct?

22 A. Well, I don't believe in fixed charities because their

23 overheads are so high that the charity gets very little of the

24 money. If I want to give money, I give it to an individual. I

25 know where it goes and I know what it's for.

26 Q. Perfect. So let's keep looking at the checks where you

27 donated to Mr. Pougnet personally.

28 A. All right.


551

1 Q. So we have here another check that says, "George

2 Marantz" on Mesquite Avenue. It's written in, "Cash."

3 That's your signature; right?

4 A. That is correct.

5 Q. And we see here the date of April of 2014; correct?

6 A. Correct.

7 Q. And we see the check amount.

8 A. 2500.

9 Q. And again, cash; right?

10 A. Yes.

11 Q. Same writing we saw before?


13 Q. What year did your wife pass, sir?

14 A. She passed away six years ago, seven years ago now.

15 Q. So this was subsequent to her passing. So this

16 writing, as you look at it now, is that your secretary's

17 writing?

18 A. That writing -- the "Cash" looks like mine. The 2,000

19 looks like -- the 2800 looks like it could be hers. She's a lot

20 neater than I am.

21 Q. So let me ask you, sir: As you sit there, because

22 you're a little bit at an odd angle, is it 2500 or 2800?

23 A. 2500.

24 Q. Okay. Let's move on.

25 Now here we see another check written in September of

26 2014.

27 A. That is my handwriting, yes.

28 Q. Yes?


552

1 A. Yes.

2 Q. Again it says, "Cash"?

3 A. Yes.

4 Q. And here again, 2,500, your signature; right?

5 A. Uh-huh.

6 Q. Is that a yes?

7 A. Yes.

8 Q. So this one is different. This one is in December of

9 2014; similar writing that we saw previously. This check

10 actually has a different signature, and it says it's from your

11 211 Mesquite Avenue address.

12 A. That's from Happy Traveler.

13 Q. That's Happy Traveler?

14 A. I think so.

15 Q. And it says, "donation," on this check; correct?

16 A. Well, that's what she put. That's Renee.

17 Q. Renee is your secretary?

18 A. Yeah.

19 Q. And she has signing rights?

20 A. Absolutely.

21 Q. Okay. She helps you in your everyday --

22 A. She runs the company. She lets me come in once in a

23 while and visit.

24 Q. Okay. I like it.

25 And the check is made out to Steve Pougnet; right?

26 A. Yes.

27 Q. And that's for a thousand dollars?

28 A. Well, why it's only a thousand, I don't know.


553

1 Q. Maybe because it was a donation that time?

2 A. No. It was a gift.

3 Q. It was a gift. Okay.

4 Let's keep moving on.

5 We see another check for January of 2015 that also

6 says, "Cash," for a thousand dollars.

7 Is that a check from your company, sir? Your name is

8 on the check?

9 A. Yeah, it's from the company. Renee signed it. I can't

10 read the address up there.

11 Q. It's 211 Mesquite Avenue; is that correct?

12 A. That's correct, but it has my name on it; right?

13 Q. Yes, sir.

14 A. I guess my personal checks have that address.

15 Q. Okay. Let's keep going.

16 Okay. That's it.

17 So over a period of years, Mr. Marantz, we see that you

18 were giving money regularly to Mr. Pougnet; right?


20 Q. And you were giving him money because he needed money;

21 that's what you were saying?

22 A. That's right. I give the money in the same situation

23 to the Jewish temple. The rabbi comes by every month, and I

24 give him a check.

25 Q. So let's talk about your company, the G & M

26 Construction. At some point in time were you doing projects

27 that required you to go before council?

28 A. Just once.


554

1 Q. And was that --

2 A. Excuse me. I'm sorry. We do it all the time. We just

3 had one go in front of city council last week. Most of our

4 projects do go in front of the city council.

5 Q. Let me take you back to December of 2012.

6 Did you have a project that was before the city council

7 then?

8 A. Probably. Let me look at the thing, and I'll tell you.

9 We do a lot of work for the City of Palm Springs, and the city

10 council has to approve every project.

11 Q. Okay. That's the Belardo project; is that correct?

12 A. I'm trying to figure out what it was. I see the fire

13 chief in there and everything else.

14 Yes, I had to go in front of city council. Anything

15 over $10,000, we go in front of city council.

16 Q. How much money did you make on that project?

17 A. We lost about a million dollars.

18 Q. And we see here in the minutes, page 17 of 22, and it

19 says there was a change order at some point; right?

20 A. On the rocks, the amount of rocks that were there.

21 Q. What does a "change order" mean?

22 A. It means that there was -- the scope of work was

23 increased.

24 Q. So it went from -- it increased by $10,773; correct?

25 A. That's correct. We hit more boulders than we

26 anticipated. We hit a lot more than that, but that's all I

27 asked for.

28 Q. This will be exhibit next in order, 67. I have tabs on


555

1 here.

2 So ultimately it was over a $2 million project?


4 Q. Okay. So this was a time frame in which Mayor Pougnet

5 was on the --

6 A. He was the mayor.

7 Q. -- city council?

8 A. Yeah.

9 Q. And he voted on it; right?

10 A. Him and four other members, yes.

11 Q. And that was also the same time frame that he was

12 getting money from you; correct?

13 A. Yes.

14 Q. At some point in time, sir, did you ever get

15 interviewed by investigators from the district attorney's

16 office?

17 A. What was the question again?

18 Q. Were you ever interviewed by an Investigator Mike

19 Gavin?

20 A. Possibly. It would have been later.

21 Q. Yes. Much later.

22 A. Oh, yes, much later. Absolutely.

23 Q. A very tall man?

24 A. Who remembers? I'm 81 years old. There's a lot of

25 things I don't remember.

26 Q. That's fine.

27 A. The answer is probably yes.

28 Q. Now, do you remember actually sitting and talking with


556

1 this investigator?

2 A. Yes.

3 Q. And it was at your business; correct?

4 A. Yes.

5 Q. And there was another gentleman with him as well?

6 A. Yes.

7 Q. And during the time you were talking, you didn't know

8 he was recording; right?

9 A. I might have known. He might have said something. I

10 don't remember.

11 Q. But there wasn't a recorder right in front of you?

12 A. No, there wasn't. He might have been recording it, and

13 it really didn't bother me because I was telling the facts, the

14 truth.

15 Q. You were telling the truth; correct?

16 A. I was telling a story. I tell a lot of stories.

17 Q. But were you telling the truth?

18 A. Yes, I was telling the truth.

19 Q. And you were asked a question or questions about how

20 you kind of started in Palm Springs. And tell us about your

21 father. Was he also in construction?

22 A. No.

23 Q. What did your father do?

24 A. He was miserable, but outside of that, my dad was a

25 businessman. He was -- he would be -- he got involved in many

26 businesses.

27 Q. Was your father involved in city projects and

28 development?


557

1 A. No. Not at all. Not whatsoever.

2 Q. Your father was never involved in development projects

3 in the city of LA?

4 A. In the city of LA, yes. Not here.

5 Q. Let me finish my question, please, Mr. Marantz, and

6 that way the court reporter can take down what I'm saying and

7 what you're saying.

8 So it is true, then, your father at some point was

9 involved in development and projects in the city of LA?

10 A. That's correct. Mainly the county.

11 Q. Okay. And you grew up watching your father?

12 A. Watching him operate, yes.

13 Q. And you also noted in that interview that your father

14 would pay politicians as part of the process; correct?

15 A. No, not really. He gave them a lot of political

16 contributions. It was one hand washed the other. Not

17 necessarily.

18 I never saw a situation where he asked for a favor and

19 money exchanged hands. He would ask for a favor, and at the

20 appropriate time -- Christmas, New Year's, birthdays -- he would

21 obviously give them -- when I say "obviously," this is what

22 happens in major cities -- he would give them some kind of

23 political contribution, not to themselves but to their campaign.

24 Q. You just used the phrase, "One hand washes the other."

25 A. That's a phrase I would have used, yes.

26 Q. So you talked about that with Investigator Gavin as

27 well; right?

28 A. I'm sure I did.


558

1 Q. And when you talk about one hand washing the other,

2 that's what you were doing as well with the mayor; right?

3 A. No, not really, because the mayor had no authority over

4 what I did.

5 Q. The mayor --

6 A. The mayor basically was a friend, and I was helping --

7 there's other people in this town I help out the same way. But

8 the mayor was a friend that his costs of living were very high

9 in relation to him flying back to Colorado every week or two

10 weeks.

11 Q. And so --

12 A. In other words, he was spending a lot more money than

13 he was obviously earning from the City of Palm Springs. Now the

14 City has raised the amount of money they pay the mayor, so I

15 don't know if the same condition would hold true today.

16 Q. Okay. So let's focus on the questions that I'm asking

17 relating specifically to Mr. Pougnet.

18 So Mr. Pougnet was hard of cash, and you were there to

19 help him and --

20 A. He never begged me. He said could I spare a couple

21 thousand bucks, and the answer was yes, because I've done it

22 with other people in town.

23 Q. When you say you've done it with other people --

24 A. In Palm Springs.

25 Q. I know you donated --

26 A. I donated to this and I donated to that. And I have

27 friends that come to me that are having a little bit of a hard

28 time, so I write them a check.


559

1 Q. Mr. Marantz, it's very difficult for the court reporter

2 to take down what you say.

3 A. I'm sorry. I'm sorry. I went too fast.

4 Q. You're going too fast and you're talking at the same

5 time, and she can't take what I say and you say.

6 A. Okeydokey.

7 Q. I want you to pause after you say something, and then

8 I'm going to pause. Okay?

9 A. Okay.

10 Q. All right. So have you ever given money to any other

11 politician as a donation for them personally, other than Mayor

12 Pougnet?

13 A. Yes.

14 Q. Who?

15 A. Can't remember. One of them was -- I don't remember

16 the names. Nobody in the quantity of money I gave to Steve.

17 Q. Okay.

18 A. Okay. But, yes, I gave politicians money all the time.

19 Not now. I used to.

20 Q. All right. I'm glad --

21 A. I don't like any of them now. That's why.

22 Q. There's some photographs behind you. Can you see them?

23 Do I need to move you?

24 A. Okay. Yeah. One of them is me. Oh, right there. All

25 right.

26 Q. Did you ever give any of those people money? Ginny

27 Foat? Paul Lewin?

28 A. Ginny Foat, possibly.


560

1 Q. How much did you give Ginny?

2 A. 500 bucks, maybe.

3 Q. 500?

4 A. Maybe.

5 Q. Why only 500?

6 A. Because I didn't like her as much.

7 Q. Did she ask for 500?

8 A. I don't remember. Chris Mills I gave some money to

9 also.

10 Q. As part of his campaign or a loan?

11 A. No, no. These are all campaign money, no loans.

12 Q. Only Pougnet you gave --

13 A. Only Pougnet I gave loans.

14 Q. They weren't loans.

15 A. Gifts.

16 Q. Gifts.

17 Did you ever give gifts to John Raymond?

18 A. No.

19 Q. Do you know who he is?

20 A. Yes.

21 Q. Did John Raymond like gifts?

22 A. I would have no idea.

23 Q. What about David Ready?

24 A. Never. I one time did a job for David. He insisted on

25 paying me. I said, "No. It's on the house."

26 He says, "No way. I'm paying you."

27 I said, "Okay."

28 Q. What about Jon Roberts?


561

1 A. No.

2 Q. Hutcheson?

3 A. No.

4 Q. Okay.

5 A. Walt Hutchinson, yes, but he was a banker.

6 Q. Not to be confused with the one on council?

7 A. Not to be confused.

8 Q. Okay. When you were being interviewed by

9 Investigator Gavin, you never told him that it was a donation

10 for him personally or -- what did you say?

11 A. It was not a donation. It was a gift.

12 Q. Okay.

13 A. None of these were donations.

14 Q. At some point --

15 A. Maybe one was. I don't know. But most of them were

16 gifts.

17 Q. At some point in time have you sat down and had coffee

18 or breakfast with Mr. Wessman's attorneys?

19 A. No. Have I? I don't think so.

20 Q. Have you ever sat down and spoke with Mr. Soda and

21 Mr. Greenberg?

22 A. Oh, Soda? Rod Soda is my attorney also.

23 Q. Yes, I know that. Thank you.

24 A. And you're welcome.

25 Yes, Rod defended me on a case.

26 Q. On a few cases; right?

27 A. Yes. One of them he blew, but two cases.

28 Q. On the cases -- so you already had a personal


562

1 relationship with Mr. Soda?

2 A. Oh, yes. Way before John did.

3 Q. Okay. What do you think of John Wessman? What's your

4 relationship like?

5 A. Do we have a half hour? I've known John since he came

6 to town.

7 Q. Okay. So are you friendly?

8 A. If John has a friend, the answer is yes.

9 Q. Does he go to your Tuesday night dinners?

10 A. No. Of course not.

11 Q. No. Did John ever come to your business and talk to

12 you about raising money or giving money to Pougnet?

13 A. Indirectly, yes.

14 Q. How?

15 A. We tore some buildings down at the Fashion Plaza. We

16 put a bid in on them, whatever it was. We made a substantial

17 amount of profit, and John knew that. He came to me once and

18 said, "George, if you cut your bill by $10,000, it would sure

19 help Steve out."

20 Q. Okay. And did you do that?

21 A. Yes.

22 Q. And was that made public anywhere?

23 A. What was that?

24 Q. Was that public anywhere?

25 A. No.

26 What we did is we billed 10,000 less than we should

27 have. I was very sorry I did it because John worked me over.

28 Steve never saw that money.


563

1 Q. How did John work you over?

2 A. He put the money in his back pocket, that's how he

3 worked me over.

4 Q. Did you at some point have a bad taste in your mouth

5 for Mr. Wessman?

6 A. For John, yes. For that one instant, yes. But I

7 understand him. I've known John for 40 years. I understand

8 him. He bid on it because he was going to give me the right to

9 bid on another job, which he never did. I forgot which job it

10 was.

11 Q. When you say "he" was going to give you the opportunity

12 to bid --

13 A. Wessman.

14 Q. I'm talking.

15 A. Okay. Your turn.

16 Q. Who? Mr. Pougnet or Mr. Wessman?

17 A. Had nothing to do with Steve.

18 Q. Mr. Wessman?

19 A. Mr. Wessman.

20 Q. All right. Okay. So --

21 A. May I say something?

22 I'm not sure Steve even knew it went on. John came to

23 me. There was another project we were interested in that John

24 controlled, and he basically said, "If you give me a $10,000

25 discount on that, I'll give you the opportunity on this," and it

26 never happened.

27 Q. Is it fair to say John kind of rules the world in Palm

28 Springs development?


564

1 A. At one time he did, yes.

2 Q. And whatever John Wessman wanted and whatever projects

3 he needed, he got them; right?

4 A. Not necessarily.

5 Q. Okay.

6 A. I can't say that. He used to scream and holler a lot

7 at city council.

8 Q. At one point him and Pougnet didn't even like each

9 other; right?

10 A. That's possible. I don't know the personal

11 relationships there.

12 Q. Were you ever involved in a kum ba yah dinner between

13 Pougnet and Wessman?

14 A. No.

15 Q. But you did have people come to your business and you

16 guys would talk about stuff and have drinks in your back office;

17 right?

18 A. All the time.

19 Q. Who would go to those meetings?

20 A. Mr. Pougnet.

21 Q. Okay. Who else?

22 A. The head of the water company, the head of the power

23 company.

24 Q. Who else?

25 A. A couple attorneys.

26 Q. Names?

27 A. You want names?

28 Q. Yeah.


565

1 A. Okay. Paul Seltzer was one of them. Paul has passed

2 away unfortunately.

3 Q. Who else?

4 A. Dave Baron was one of them.

5 Q. Okay. Dave Baron.

6 A. He's still practicing law.

7 Q. And he is the attorney for the Palm Springs Film

8 Festival; right?

9 A. Yes, he is.

10 Q. Dave Baron. Pougnet. Meaney?

11 A. No.

12 Q. You like him?

13 A. No.

14 Q. Okay. Who else?

15 A. There was about six or eight guys.

16 Q. And what would you talk about?

17 A. We played dominoes, and we'd talk about -- very

18 seldomly about the city. We talked about things in general.

19 Q. Okay. You like dominoes?

20 A. Huh?

21 Q. You like dominoes?

22 A. Not particularly.

23 Q. Washing the bones?

24 A. It's social.

25 Q. Okay. And you're saying although the head of the water

26 and the head of other departments and Pougnet and David Baron --

27 who's very involved; right? He's involved in the city

28 development?


566

1 A. He was. I don't know now. He was in those days.

2 Q. You never talked about projects? Come on.

3 A. No, not really.

4 Q. Maybe?

5 A. Never really talked about business because the deal was

6 you don't talk about business. This is after work, sit down, we

7 talk about wives, we talk about where we're going, and that's

8 what we talked about.

9 Q. Okay. And it just was in the company of the people who

10 were kind of running the city at the time?

11 A. They weren't running the city. They were running

12 companies that do business with the city. The water company is

13 not owned by the city. It's a privately owned company. Edison

14 is a privately owned business.

15 Q. The head of Edison and the head of the water company

16 obviously work hand in hand with the City; correct?

17 A. I don't know. I don't know if they ever even got

18 along, to be honest with you. They were fighting all the time.

19 Q. Now, let's go back to meeting with Mr. Soda.

20 So after you had met with the investigators from the

21 district attorney's office, you had an opportunity to meet with

22 Mr. Soda; right?

23 A. After --

24 Q. So years later a district attorney investigator came

25 and talked to you; right?

26 A. Yeah.

27 Q. And then years later, did you ever meet with Mr. Soda,

28 or months later?


567

1 A. Concerning what?

2 Q. His client, Mr. Wessman?

3 A. No. We never discussed Mr. Wessman.

4 Q. But you had lunch or breakfast or something with him?

5 A. With Rod, yeah.

6 Q. And Renee? Renee was there with you?

7 A. No, not really. She may have been.

8 Q. What did you talk about?

9 A. Things in general.

10 Q. You didn't talk about this case at all?

11 A. Never talked about this case. Never cared about it.

12 Q. Okay. Other than that one project during this time

13 frame, do you recall any other projects that you had ongoing

14 during the time you were giving Mayor Pougnet money?

15 A. Can't remember. Got to be a myriad of them. Mostly

16 not city hall, though. Mostly private. We did not do that much

17 work for the City. One or two projects a year, maybe.

18 Q. And when you -- when you've talked about this case

19 previously, you've said there wasn't any quid pro quo; correct?


21 Q. But when you were specifically being spoken to by the

22 investigator at your place of business, you did talk about one

23 hand washing the other; right? That was your phrase.

24 A. I have no recollection of that conversation, and

25 it's -- I might have been talking about Los Angeles and my dad,

26 I don't know. Because that's where that happened. There was

27 very little of that here in Palm Springs. Palm Springs was a

28 very small town at that time.


568

1 Q. Everybody knew everybody; right?

2 A. Well, it was a small town.

3 MS. BARAJAS: Any other questions from the grand jury?

4 Q. BY MS. BARAJAS: Why were the checks made out to cash

5 and not specifically to the mayor?

6 A. Easier for him to cash.

7 Q. Okay. So if it said, "Pougnet" --

8 A. I can't spell Pougnet to start with. I'm a nonreader.

9 I'm the last graduate of the University of California, Berkeley

10 that could neither read nor write, so I cannot spell that well.

11 Q. Mr. Marantz --

12 A. Go.

13 Q. -- you did not write a number of those checks?

14 A. That's right.

15 Q. So let's be --

16 A. I have people to do that.

17 Q. That's correct. Let's be honest. You're under oath.

18 You're in front of a number of grand jurors.

19 Was there a reason why you didn't write "Pougnet"

20 versus "Cash"?

21 A. No reason whatsoever.

22 Q. Are you certain, sir?

23 A. Absolutely certain.

24 Q. Okay. Thank you so much for being here today.

25 A. Thank you for having me today. It's been a real

26 pleasure.

27 GRAND JURY FOREPERSON: Before you leave, I have an

28 admonition to read to you.


569



3 regard to this matter or your answers until authorized by this











14 THE WITNESS: I understand and don't remember any of

15 the questions to speak of. So I have no -- I have no problem.

16 MS. BARAJAS: So when you have dinner tonight --

17 THE WITNESS: When I have dinner tonight, I have no

18 problem.

19 MS. BARAJAS: All right. No discussion about it.

20 THE WITNESS: No discussion. Even with Matzner.

21 MS. BARAJAS: Even with Matzner. Good to see you, sir.


23 THE WITNESS: Thank you for having me also.

24 MS. BARAJAS: Okay. Thank you. Take care.

25 THE WITNESS: May I make a statement?

26 MS. BARAJAS: No.

27 THE WITNESS: Okay. I will not make a statement.

28 Thank you.


570

1 MS. BARAJAS: Thank you. Have a good day.

2 THE WITNESS: You have a good day, too.

3 MS. BARAJAS: So we're going to reference 39 again, and

4 it's just the checks.

5 THE WITNESS: Good morning.

6 THE GRAND JURY (COLLECTIVELY): Good morning.

7 THE WITNESS: Right here?

8 MS. BARAJAS: Yes, please. In the hot seat.

9 If you can remain standing just for a minute.

10 GRAND JURY FOREPERSON: Please remain standing and

11 raise your right hand.




15 THE WITNESS: So help me God.

16 GRAND JURY FOREPERSON: Please be seated.

17 I have a statement acknowledging a secrecy order that I

18 would like you to read it to yourself, then sign and print your

19 name and date it at the bottom.

20 MS. BARAJAS: Ma'am, do you want to sit near the desk?

21 I had moved the chair over.

22 THE WITNESS: Oh, for George?

23 MS. BARAJAS: Uh-huh.

24 THE WITNESS: Okay.


26 Please state and spell your name for the record.

27 THE WITNESS: Renee Suzanne Breiling, B-r-e-i-l-i-n-g.

28 Renee, R-e-n-e-e.


571

1 GRAND JURY FOREPERSON: What was the middle name?

2 THE WITNESS: Suzanne, S-u-z-a-n-n-e.




6 RENEE SUZANNE BREILING,


8 follows:


10 BY MS. BARAJAS:

11 Q. Thank you for being with us this morning.

12 A. You're welcome.

13 Q. Thank you for being patient this morning. We had to

14 get started, even though you folks were late. So I apologize

15 for the delay for you to have to wait.

16 Where do you work, ma'am?

17 A. G & M Construction.

18 Q. Are you a partial owner of that company?

19 A. It will be left to me, yes.

20 Q. Tell us about your relationship with Mr. Marantz.

21 A. He's my employer, my friend. I started working for him

22 eight years ago out of a little ad in the newspaper, and he's

23 like my -- almost like my father to me. And since he's lost his

24 wife, I mean, I do everything for him.

25 Q. You care for him?

26 A. Oh, a lot, yeah.

27 Q. And also not just emotionally, but you care for him in

28 his day-to-day? You assist him with --


572

1 A. Everything. Other than his caregiver of changing him

2 and putting him to bed, everything.

3 Q. All right. So I want to direct you specifically to

4 what we've identified as People's 39 as an exhibit. And we're

5 going to go through a series of checks.

6 A. Okay.

7 Q. I just want to ask you about them.

8 So as part of what you do for Mr. Marantz, do you

9 actually have signing rights on his checks?

10 A. Yes.

11 Q. Now, were you working for him going back to 2012?

12 A. Yes.

13 Q. And were you familiar with the former mayor, Stephen

14 Pougnet?

15 A. Yes.

16 Q. When Mr. Pougnet would come and visit Marantz, were you

17 there?

18 A. Sometimes, yes.

19 Q. Did you ever hear the mayor asking George for money?

20 A. No.

21 Q. Okay. Did you ever see George giving him money?

22 A. Yes.

23 Q. In fact, did you actually help George facilitate these

24 checks?

25 A. Sometimes, if he was not in the office, yes.

26 Q. If something was typed out, would that have been

27 something you did?

28 A. No.


573

1 Q. Who would have done that?

2 A. Grace, our 80-, 90-year-old bookkeeper.

3 Q. So we see a check here, and it's from September of

4 2014.

5 Does this look like a check from the Happy Traveler RV

6 Park?

7 A. Uh-huh.

8 Q. Is that a yes?

9 A. Yes.

10 Q. It has to be an audible word for the court reporter.

11 Is that George's signature?

12 A. Yes.

13 Q. If we can move down.

14 Another check in the amount of 5,000 this time. Is

15 that George's signature?

16 A. Yes.

17 Q. And, again, we see it typed out. Did you type out that

18 check?

19 A. No.

20 Q. That would have been the same accountant?

21 A. Uh-huh.


23 A. Yes.

24 Q. And it says, "Cash." Do you know why the checks were

25 made out to cash?

26 A. We do a lot of checks to cash.

27 Q. Why?

28 A. We cash checks for dump fees. George is old-fashioned,


574

1 so is Gracie, our bookkeeper.

2 And Bambang works extra hours. We write out a cash

3 check, and it's easier for them to just go to the bank and cash

4 it, I guess.

5 Q. Let me stop you.

6 You made reference to a gentleman's name. Can you say

7 it and spell it again for the court reporter.

8 A. His caregiver, Bambang, B-a-m-b-a-n-g, Taruna,

9 T-a-r-u-n-a.

10 Q. So when he works, you just write him a check for cash?

11 A. Well, no. Like if we're out and he runs out of --

12 George runs out of cash and Bambang gives him money, and he owes

13 him money back, we write out a check for cash, and he cashes it

14 and pays him back.

15 Q. So let's keep going.

16 So we see a check here that's dated May 27, 2013?

17 A. Uh-huh.


19 A. Yes.

20 Q. Is that your writing on the check?

21 A. Yes.

22 Q. And again it's made out to cash?

23 A. Uh-huh.

24 Q. Yes?

25 A. Yes.

26 Q. Were you there, obviously, then, when the money was

27 given to Pougnet?

28 A. Uh, I don't know. That's my writing. I wrote the


575

1 check out. I don't even know if I was there when George signed

2 it, or he called me, told me to write it, leave it there.

3 Q. How did it work?

4 A. Did what work?

5 Q. How did giving checks to Pougnet work in your

6 experience?

7 A. Um, sometimes Steve would come in. He was a friend of

8 George's. He would stop by all the time, even when George's

9 wife was dying. He would come to the house to see his wife.

10 He'd bring the kids in. And they did dominoes in the back room

11 of the tree house. Half of them are gone now, so we don't even

12 use them anymore.

13 Q. What do you mean by the tree house?

14 A. We have a little dominoes table in the office, and the

15 guys after work would come over and have a drink, play dominoes.

16 So if George was out of the office and he was gonna

17 give Steve some money, like he did a lot of friends -- if Steve

18 needed money, George is a very generous person.

19 Q. Any other politicians George gave money to?

20 A. He's done campaigning before for like board of

21 directors for Desert Water Agency.

22 Q. Your understanding of this money to Pougnet was for

23 personal -- it was personal, it wasn't for a campaign donation?

24 A. Correct.

25 Q. Did George give any other politician money for personal

26 use?

27 A. What do you consider a politician? I mean, George

28 gives a lot of people -- just gives them money, so I guess I


576

1 would say yes.

2 Q. Okay. Let's keep going through these checks.

3 So we see here you wrote a check out for cash for 2500,

4 and you've identified check number 1544 being written out by

5 you. Let's look at the next one.

6 Now we're looking at check 1545, same exhibit, dated

7 June 3rd of 2013. That's your writing again; right?

8 A. Yes.

9 Q. And again we see "Cash"?

10 A. Yes.

11 Q. And we see 2500; right?

12 A. Yes.

13 Q. And that's George's signature?

14 A. Yes.

15 Q. Do you recall writing that check out?

16 A. Well, I write out all the checks now, but, yeah, I

17 guess. It's my writing.

18 Q. Okay. So you can identify the writing, but you don't

19 recall the circumstances on June 3rd, 2013?

20 A. No.

21 Q. Let's go to the next one.

22 Now we're looking at a check 1592, dated December 8th,

23 2013.

24 And we see that's written out to cash. Is that your

25 writing?

26 A. No.

27 Q. That's actually Mr. Marantz's writing; correct?

28 A. Yes.


577

1 Q. Again, it doesn't say anything on the memo line, and it

2 just says, "Cash"; right?

3 A. Uh-huh.

4 Q. Yes?

5 A. Yes.


7 Here we see another check. This time it says it's from

8 Mr. Marantz. Is that his personal account?

9 A. Yes.

10 Q. Pacific Premier?

11 A. Yes.

12 Q. And, again, it's dated April of 2014; right?

13 A. Yes.

14 Q. Another 2500?

15 A. Yes.

16 Q. Cash?

17 A. Yes.

18 Q. And that's George's signature?

19 A. Yes.

20 Q. But you wrote out the check?

21 A. Yes.


23 Dated September 2014, check number 1744, same exhibit,

24 same account.

25 Is that George's writing?

26 A. Yes.

27 Q. Also out to cash; right?

28 A. Yes.


578

1 Q. And then we also see a signature from Mr. Marantz

2 again; right?

3 A. Yes.

4 Q. Next check.

5 Now we're looking at a check dated December 29th of

6 2014, and this one actually says to Stephen Pougnet.

7 A. Yes.

8 Q. So you knew how to spell Pougnet; right?

9 A. Yeah. Yes.

10 Q. And this one actually says, "Donation"?

11 A. Yes.

12 Q. Why?

13 A. Because if I'm writing to him, I assumed it was a

14 donation. I don't -- you know, Steve was a friend. When I

15 work, what I do at my job, I like to reference things. So

16 that's why I wrote that on there, because that's what it would

17 be to me.

18 Q. And you actually signed this check?

19 A. Yes.

20 Q. That's your signature?

21 A. Yes.

22 Q. So were you a little bit more careful because it was

23 actually you writing and signing the check?

24 A. It had nothing to do with it. George probably called

25 me and says -- because when he was healthier, he would be out at

26 the jobsite. And by the time he'd be back, I would be gone. If

27 he called me and said, "Write a check to Steve, sign it, and

28 leave it on my desk," that's what I would do.


579

1 Q. All right. And so this one is actually made out to

2 Mr. Pougnet?

3 A. Uh-huh. Yes.

4 Q. And you don't understand or recall why?

5 A. Because George asked me to.

6 Q. You remember specifically that he asked --

7 A. Or I wouldn't have written it for any other reason.

8 It's not my account. It's George's.

9 Q. So Mr. Marantz asked you to write a check out

10 specifically noting "Steve Pougnet" and "Donation"?

11 A. No.

12 Q. Tell me.

13 A. I put "Donation" on there myself.

14 Q. All right. But he specifically said, "Write Steve

15 Pougnet" --

16 A. "Write Steve a check for a thousand dollars."

17 Q. But the other checks he wrote, "Cash."

18 A. Well --

19 Q. Why was this one different?

20 A. I don't -- I can't answer that.

21 Q. You don't have a memory of it?

22 A. Because if George was in the office, you have to

23 understand George Marantz, the life of George Marantz. If he

24 was in the office and he would do a check for cash with the

25 bookkeeper, whatever you do was for cash. When he told me to

26 write a check to Steve, I probably got in trouble for writing it

27 to Steve instead of cash, because he writes every check to cash.

28 So I don't know. I can't answer that.


580

1 Q. All right. That's fair.

2 I think that's the last one. One more.

3 Again, same -- it's your writing; right?

4 A. Yes.

5 Q. And that's your signature?

6 A. Yes.

7 Q. And this is the last check on that exhibit. And,

8 again, it's for a thousand dollars the following month, no

9 notation on the memo line?

10 A. Correct.

11 Q. Why?

12 A. Because he asked me to write a check for cash, so I

13 don't know what it was for.

14 Q. So you didn't know that it was going to Pougnet?

15 A. Not necessarily, no.

16 Q. Okay. So if there was a check written out to cash for

17 a certain amount and given to Pougnet, you didn't necessarily

18 know it was going to Pougnet?

19 A. Not unless I was in the office when George asked the

20 bookkeeper to run a check, no.

21 Q. Okay.

22 A. He could have given him one without me knowing. I

23 wasn't as involved in the company as I am now. I do everything

24 now, so I would know.

25 Q. When you saw Pougnet coming in, did he ever tell

26 George -- were you ever present when he was telling George that

27 he was hard for cash?

28 A. In front of me, no. He didn't really speak about that


581

1 in front of me. He was a proud person. He would have spoken to

2 George personally about that.

3 Q. Then you said the men would come and they would play

4 dominoes in the office.

5 Any other developers or people within the city that

6 would come?

7 A. The city of Palm Springs, yes, they all live in Palm

8 Springs.

9 Q. That were part of the council, the politics?

10 A. No.

11 Q. The head of Edison? The head of the water company?

12 A. Yes.

13 Q. Yes to both of those?

14 A. Dave Lucker, general manager of Desert Water. It's a

15 small town. Everybody knows everybody.

16 Q. What about Wessman?

17 A. No. Never saw him there. And, again, a lot of times

18 they came after I was already gone from the office. They all

19 come in after work.

20 Q. What about Meaney?

21 A. No.

22 Q. What about Noble, owner of Wintec?

23 A. Fred Noble?

24 Q. Yeah.

25 A. No.

26 Q. What about -- obviously he has dinner with Mr. Matzner

27 once a week?

28 A. Every Tuesday they go out to dinner.


582

1 Q. Okay. And where do they go?

2 A. All over the place. It depends. There's like 10 to 11

3 people, guys, all men. No, there's one woman. I take that

4 back.

5 Q. Who's the woman?

6 A. Carol Fragen.

7 And they all bicker where they're going to go next

8 week. They try to keep it in Palm Springs, give new restaurants

9 a try, try to keep the money in the town for new people. So

10 they go different places every Tuesday.

11 Q. Have you ever spoken to any person on the legal team

12 for Mr. Pougnet?

13 A. No. I don't even know who they are, no.

14 Q. Have you ever spoken to anyone on the legal team for

15 Mr. Meaney?

16 A. No. I don't even know who they are either.

17 Q. But you have sat down and spoken with Mr. Wessman's

18 attorneys; right?

19 A. No. Not unless I don't know who they are.

20 Q. Do you know Mr. Rod Soda?

21 A. Oh, yes. Yes, I do. Yes.

22 Q. And Mr. David Greenberg?

23 A. That name doesn't ring a bell.

24 Q. At some point in time there was a conditional exam of

25 Mr. Marantz; is that right?

26 A. Correct.

27 Q. And it was a hearing where we were able to ask

28 questions and you were -- you were present?


583

1 A. Correct.

2 Q. You were actually in the courtroom?

3 A. Yes.

4 Q. And Mr. Soda was counsel for Mr. Wessman; right?

5 A. Yes.

6 Q. One of multiple attorneys; correct?

7 A. I don't know how many attorneys Mr. Wessman has.

8 Q. In the room.

9 A. Oh, yeah. There was a lot of people there, yes.

10 Q. Now, during the time, are you familiar with the fact

11 that Mr. Soda represented Mr. Marantz?

12 A. Back in the day?

13 Q. Yes.

14 A. I didn't until George told me. I wasn't here at that

15 time.

16 Q. All right. And that -- Mr. Marantz actually testified

17 to that. For the first time that came out during that hearing;

18 right?

19 A. I don't understand what you mean.

20 Q. That Mr. Soda, not only did he represent Mr. Wessman

21 today, but he also represented Mr. Marantz?

22 A. Well, they were asked -- he was asked that question, I

23 guess, yes.

24 Q. Right. And there were a number of instances where

25 Mr. Marantz was actually represented by Mr. Soda; correct?

26 A. Yes.

27 Q. And during that same hearing, Mr. Marantz testified

28 that prior to that hearing, he had met with Mr. Soda and you at


584

1 some sort of restaurant establishment.

2 A. Billy Reed's, I believe, yes.

3 Q. Billy Reed's. Is that a common restaurant, diner in

4 Palm Springs?

5 A. Yes. We're there once a week.

6 Q. And what did you talk about with Mr. Soda?

7 A. George and about back in the day. I mean, memories.

8 They've known each other a long, long time. Way before my time.

9 Q. And that meeting was just before Mr. Marantz was

10 supposed to testify; right?

11 A. I don't recall. It was near that time, yes.

12 Q. Right. And so over a period of years he'd never even

13 spoken to Mr. Soda, and then all of a sudden --

14 A. Oh, no. Yes, he has.

15 Q. How frequently does he talk to Mr. Soda?

16 A. Whenever he would call or be around or in the area.

17 Sometimes he would stop in the office because he was in the

18 area.

19 Q. Did you talk about the hearing that was coming up?

20 A. I didn't. I don't recall. I'm sure he probably

21 brought it up --

22 Q. What was --

23 A. -- to George.

24 Q. What was discussed?

25 A. Not much. We were at lunch, our lunch hour.

26 Q. So what was discussed relating to the case?

27 A. I don't recall anything at all. I mean, about the

28 case. That there was a case going on, yes. That was basically


585

1 it. They were mainly talking about their old times back in the

2 day.

3 Q. Since the time in which the hearing took place, have

4 you sat or spoke with anyone on Mr. Wessman's legal team?

5 A. No.

6 Q. Have you spoken to Mr. Soda?

7 A. He called to say hi, I don't know, a couple months ago.

8 That's basically it. Or maybe he stopped by the office. I

9 don't recall, but, yes, I've talked to him since.

10 Q. And did he have an occasion to talk to Mr. Marantz?

11 A. Yeah, it would have been both of us.

12 Q. And at some point in time two investigators from the

13 district attorney's office actually came and interviewed

14 Mr. Marantz; right?

15 A. I was not there, but that's what I was told by George,

16 yes.

17 Q. And you weren't present during that interview; correct?

18 A. No.

19 Q. Did Mr. Soda ever prepare or say what to say in court?

20 A. Not to me, no.

21 Q. To George?

22 A. If he did, I wasn't around.

23 Q. You don't recall anything like that when you were

24 having lunch or dinner or whatever --

25 A. No.

26 Q. -- at Billy Reed's?

27 Have you been honest with us today?

28 A. Yes.


586

1 MS. BARAJAS: Nothing further, unless the jurors have

2 questions.

3 GRAND JURY FOREPERSON: Are there any questions?

4 MS. BARAJAS: All right. Thank you.


6 GRAND JURY FOREPERSON: Before you leave, I have an

7 admonishment to read to you.



10 regards to this matter or your answers until authorized by this











21 THE WITNESS: Yes.




25 The secretary wants to talk about parking, apparently.

26 GRAND JURY FOREPERSON: I need to do my -- I need to

27 wrap up.

28 So before we wrap up, I need to admonish the grand


587

1 jurors that they are not to form or express any opinions about

2 the case or discuss it among themselves until the grand jury

3 receives the case for deliberation. In addition, no inspection

4 of evidence should be conducted without the permission of the

5 foreperson and on the advice of the prosecuting attorney until

6 the case is submitted to the grand jury for deliberation.

7 Deliberations should only occur when all jurors that heard all

8 the testimony in the case are present.

9 With that, we are adjourned until tomorrow at 1:30.

10 MS. BARAJAS: Yes.

11 GRAND JURY FOREPERSON: One-thirty p.m. here. Thank

12 you.

13 (Proceedings adjourned.)

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