In a tentative ruling received today by the Foundation for Taxpayer and Consumer Rights (FTCR), San Francisco Superior Court Judge Alfred Chiantelli ordered PUC Commissioner Henry Duque to be “excluded from his office and prohibited from performing any further duties as a PUC Commissioner” and to pay a $5,000 fine to the State Treasury for a financial conflict of interest. Mr. Duque held shares in Nextel Communications, Inc, a national wireless phone company subject to PUC regulation, for a period of 15 months during 1999-2000 while serving as a PUC Commissioner. Mr. Duque earned approximately $69,000 as a result of his purchases and sales of Nextel stock.
“The court today agreed with the Attorney General and the People of the State of California that Mr. Duque must leave office for his financial conflict of interest. This sends the clear message that California officials with conflicts of interest will be punished,” said Pamela Pressley, staff attorney for FTCR. “This ruling heralds a victory for the public interest in ensuring that government officials remain free from financial conflicts, especially when they are serving in a regulatory capacity. We hope that Mr. Duque will follow the Judge’s order and step down from his office immediately.”
In a November 29, 2000 opinion granting the Foundation for Taxpayer and Consumer Rights (FTCR) the right to bring an action in state court to remove Commissioner Duque, Attorney General Bill Lockyer stated, “The Constitution requires that as a qualification for holding office as a Commission member, the member must not hold a financial interest in any corporation subject to regulation by the Commission’It would therefore appear that the defendant’s office became vacant immediately upon his acquisition of the 700 shares of stock in Nextel on May 12,1999.”
FTCR’s complaint filed in S.F. Superior Court in March 2001 alleged that Mr. Duque violated Article. XII, section 7 of the Cal. Constitution and section 303(a) of the Public Utilities Code when he owned stocks in Nextel Communications, a mobile telecommunications company that is an authorized California utility subject to regulation by the California Public Utilities Commission. Art. XII, section 7 and P.U.C. section 303(a) provide that “[a] public utilities commissioner may not hold an official relation to nor have a financial interest in a person or corporation subject to regulation by the commission.”