Six indicted in Coliseum scandal, including two top rave producers
Six people have been indicted in the Los Angeles Memorial Coliseum scandal, including three who were arrested Thursday.
The indictment, unsealed Friday, caps a 13-month investigation by the district attorney's office, triggered by Los Angeles Times reports on a corruption scandal involving millions of dollars in questionable transactions at one of the nation's most storied stadiums.
Insomniac Inc. rave producer Pasquale Rotella, one of the top electronic rave producers in the nation, was named in the indictment, as expected. Also indicted were former Coliseum technology manager Leopold Caudillo Jr.; ex-stadium contractor Tony Estrada; Patrick Lynch, former Coliseum general manager; former Coliseum events manager Todd DeStefano; and Reza Gerami, chief executive of the rave company Go Ventures. Lynch, DeStefano and Gerami were taken into custody Thursday.
Bail for four of the defendants was set in amounts ranging from $800,000 to $1.2 million. Caudillo and Estrada are traveling and did not appear in court.
The Times has reported on payments by Go Ventures to companies owned by DeStefano and money directed to Lynch by a stadium contractor.
The 88-year-old Coliseum, home to USC football and the site of two Summer Olympics, is run jointly by the city, county and state. Two other state and federal probes into the operations of the Coliseum and companion Sports Arena are also underway.
Lynch's attorney, Tony Capozzola, said on Thursday that his client is innocent. Most of the money that Lynch received from the contractor was deposited in a Miami bank account, in regular installments over many years. Capozzola said the payments were for a private boat deal.
DeStefano's lawyer, Richard G. Hirsch, said in a statement Thursday that his client had permission from Lynch, his supervisor, to work on the side with promoters such as Gerami, while they did business with him in his Coliseum job.
Attempts to reach Gerami's attorney Thursday were unsuccessful. The promoter has previously denied doing anything wrong. For many years, his company staged popular raves at the Sports Arena.
DeStefano oversaw those concerts as part of his government duties. Two firms he set up collected at least $2.2 million in private fees from Go Ventures, a second rave company called Insomniac Inc. and other interests that had contracts at the Coliseum.
Insomniac presented an annual rave, Electric Daisy Carnival, at the Coliseum. The Times began to scrutinize Insomniac and Go Ventures productions after the fatal drug overdose of a 15-year-old girl at the 2010 Electric Daisy Carnival.
After the financial scandal broke, the commission decided to stop holding raves at the Coliseum and Sports Arena.
The panel has filed a civil suit against Lynch, DeStefano, Go Ventures and Insomniac, seeking the return of the money paid to DeStefano's companies as well as roughly $400,000 that Lynch collected from Estrada, was a Coliseum janitorial contractor.
Caudillo directed stadium business to a firm he founded with a co-worker, according to records and interviews.
DeStefano quit the stadium in January 2011 to work full time in the promotion field. Lynch, who had run the Coliseum and Sports Arena for 17 years, resigned a month later.
The groundwork for the scandal lay in years of clumsy stewardship, marked by inattentive commission members and a cozy relationship between Lynch and his bosses. Lynch, DeStefano and other Coliseum workers spent money, with few controls, on luxury cars, golf outings, massages and other perks.
At one point, Lynch transferred to himself ownership of a Coliseum-bought Cadillac. He and the other managers had unlimited use of a government gasoline card, racking up tens of thousands of dollars in charges even though their jobs required little driving.
Federal investigators are examining cash payments of more than $1 million -- much of it in suitcases -- to a Coliseum union representative, according to those familiar with the probe. The money was intended to cover stagehands' wages.
The Coliseum has been operating in the red since 2008 and is now so broke that it is unable to make upgrades promised in its lease with USC, the stadium's main tenant. As a result, the panel is about to surrender day-to-day control of the taxpayer-owned property to the private school.
-- Andrew Blankstein at Los Angeles Superior Court with Paul Pringle and Rong-Gong Lin II
Photos, from left: Former Coliseum general manager Patrick Lynch; ex-Coliseum events manager Todd DeStefano; Reza Gerami, chief executive of rave promoter Go Ventures. Credits: Mel Melcon / Los Angeles Times; Ricardo DeAratanha / Los Angeles Times; goventures.com