A long simmering dispute about operation of the Los Angeles Memorial Coliseum erupted Thursday with criminal charges against two former Coliseum executives and the owner of a music promotion company.
The men were taken into custody on a grand jury indictment that was not immediately unsealed, but attorneys said they understood the suspects were charged with various conspiracy counts related to operation of the venue.
The Coliseum Commission sued the same men in November, claiming they mismanaged funds and diverted money for their own use.
Attorneys for Todd DeStefano, events manager at the venue for three years, said they had been talking with the district attorney's office for a year and offered to surrender DeStefano, but authorities insisted on arresting him and taking him to jail in handcuffs. His bail was set at $2.1 million and he was scheduled for arraignment Friday.
DeStefano, 38, who previously worked for the Buffalo Bills football team and the Los Angeles Clippers basketball team, was hired away by Spectator Management, a company that booked events at the Coliseum. Eventually, DeStefano's employment was taken over by the Coliseum directly.
Attorney Richard Hirsch said his client successfully booked numerous rock concerts, raves, film shoots and commercials at the landmark venue.
"Todd DeStefano did exactly what the Coliseum commissioners asked and expected him to do," said Hirsch, "Make the Coliseum and Sports Arena a profitable enterprise."
Others arrested Thursday were former Coliseum General Manager Patrick Lynch and Reza Gerami, owner of GoVentures Inc.
In a related development, Insomniac Events, which also has ties to the Coliseum, said it expects its CEO, Pasquale Rotella, to be arrested in the matter. In a statement, the company said that Rotella has "always acted lawfully and appropriately with respect to all of his dealings with the Coliseum" and called any charges directed against him "politically motivated and publicity driven."
Attorneys Hirsch and Michael Nasatir said DeStefano is a "the scapegoat of all scapegoats" for Coliseum mismanagement.
They also said that no public money was lost and there was no theft from the Coliseum.
Last year, the Coliseum Commission sued the former executives for more than $1 million, alleging they siphoned off revenues from the taxpayer-owned Coliseum and adjacent Sports Arena. The suit also claimed Go Ventures and another company, Insomniac Inc., conspired with the pair.
The commission is a joint-powers authority that oversees the complex and has representatives of the state and the city and county of Los Angeles.
Attorneys for DeStefano filed a bail reduction motion including some 30 letters of support from friends, family and business associates including an employee of the Clippers.
Hirsch said the dispute stems from a request by promoters who used the venue for rave concerts to expand into adjacent Exposition Park, which was not a Coliseum property. He said DeStefano received approval for that from his bosses and got a percentage of the additional fees. He said the events manager also arranged for the Coliseum to receive additional fees from the arrangement.
"There exists a significant issue as to whether there was any loss at all," Hirsch said in the bail motion. "This was not Coliseum money ... There was no theft. Nothing was stolen from the Coliseum. "
Hirsch said that over three years, DeStefano received $1.8 million in fees which were percentages of events he booked through promoters.