Westside company blames LA for financial woes
100 WILSHIRE BLVD. — A Santa Monica law firm plans to legally take on the largest public utility company in the United States.
Greene, Broillet, Panish & Wheeler, LLP filed a lawsuit on Wednesday against the city of Los Angeles on behalf of a Marina Del Rey consulting company, which alleges the Department of Water and Power reneged on a multi-million dollar contract.
Dr. BJ Hawkins, the founder of OFS, also known as The Business Doctors, alleges that as a result of Los Angeles Department of Water and Power’s conduct, she and her company have sustained a loss of business, a loss of labor and capital investment, and loss of business opportunity, among other claims.
Local attorneys Browne Greene and Mark Quigley are representing OFS. The law firm also is representing dozens of victims from the July 16, 2003 Farmers’ Market crash that occurred in downtown Santa Monica.
OFS is the creator of a sophisticated e-commerce system to assist companies with their internal operations. On Jan. 9, 2002, the DWP contracted to use OFS’ system, and has since realized a cost savings of between 15 percent and 20 percent, which translates into about $35 million, the lawsuit alleges. The contract is set to expire on Jan. 9, 2005.
In 2004, OFS entered into negotiations to expand the services they provided, and the DWP indicated that it would agree to increase their expenditures to support the additional services, the suit alleges. Dr. Hawkins and OFS invested significant resources into making critical preparations for the new services, relying on the DWP’s representations that they would agree to increase the expenditure limit under their contracts, they claim.
The June 15, 2004 agenda for the DWP’s meeting of the Board of Water and Power Commissioners included an amendment to increase the expenditure limit under its contracts by $2,780,000. That amendment was removed from the agenda before the meeting took place, the suit alleges. OFS is owed at least $6 million, Hawkins said. The suit is seeking unspecified monetary damages.
“They came up with all kinds of phony excuses of why they wouldn’t move forward with the contract,” Greene said.
DWP representatives haven’t seen the claim and limited their comment by only saying the public utility has met its obligations under the contract.
Dr. Hawkins said she has never gotten an explanation from DWP representatives about why no payments have been made on the contract for nine months. She also said because she put the majority of her company’s resources into the work for DWP, OFS is on the brink of financial ruin.
“They put us in an insolvent situation,” Hawkins said. Dr. Hawkins said she believes that the DWP’s actions were motivated by a desire to protect itself from exposure to “pay to play” scams, fraud, discrimination and other illegal activity. The DWP began defaulting on many of its required payments to OFS, putting a severe financial strain, Dr. Hawkins alleges.
“I am personally concerned for not only my company but I am concerned about the taxpayers and rate payers, who are the real losers,” she said.
Originally published in the Santa Monica Daily Press print edition on August 26, 2004. Read the original PDF.