Council Settles Suit Over Use of Funds

Meeting in closed session Tuesday, a divided Los Angeles City Council agreed to settle a lawsuit alleging that the city broke its own rules by using specially earmarked funds for a variety of purposes.

The council voted 8-5 to settle the case for $750,000 in the plaintiff’s illegal fees, sources said.

Richard Fine, a Century City attorney, filed the lawsuit against the city alleging that officials illegally used $90 million over three years from a special parking revenue fund for general fund purposes. Fine has sued the city and county previously for using specially designated funds for balancing the budget or for other purposes.

Several council members, speaking anonymously, said they believed the settlement, though costly, was in the city’s best interest.

Fine was unavailable for comment Tuesday afternoon.