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Local developer files suit against 'Press Democrat' and SSU professor David McCuan

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MAKING NEWS  A series of stories about campaign donations to Santa Rosa City Council candidates has drawn legal fire from developer William Gallaher.
  • MAKING NEWS A series of stories about campaign donations to Santa Rosa City Council candidates has drawn legal fire from developer William Gallaher.

The Press Democrat is being sued for defamation by prominent Santa Rosa real estate developer William Gallaher and his son-in-law Scott Flater.

The Dec. 21 complaint, filed in Sonoma County Superior Court by Santa Rosa attorney Michael Miller, stems from a series of six articles that ran in the Press Democrat late last year which raised questions about donations made on behalf of a trio of Santa Rosa City Council candidates running for office in 2016. Two of the three candidates won their races.

The donations were independent expenditures, the paper reported, made possible through the Citizens United Supreme Court ruling that allows for campaign spending beyond a Santa Rosa rule that limits individual contributions to candidates to $500.

The gist of the series of stories was that Gallaher is suspected to have funneled campaign cash—totaling about $195,000—to preferred candidates through his son-in-law, Flater, and an independent expenditure campaign created by Flater.

The paper reported that Flater is married to Molly Flater, who is CEO of Oakmont Senior Living, which operates the sprawling Oakmont Village retirement community in Santa Rosa developed by her father.

The first in the series of stories by Kevin McCallum ran on Oct. 20 during the height of a fevered campaign season that saw record amounts of cash flow into the Santa Rosa city council races. McCallum reported that "Scott Flater, the son-in-law of politically active developer Bill Gallaher, recently reported spending nearly $40,000 to help support two other candidates—Jack Tibbetts and Ernesto Olivares. While he didn't give the money directly to either candidate, the contributions raise questions about whether Flater or people close to him are exploiting gaps between state and city campaign finance laws that limit campaign contributions to $500 each but allow 'major donors,' such as Flater, to spend unlimited funds."

The paper published another five stories about Flater and campaign contributions, capping off the series with a "what is to be done" story on Nov. 20 that surveyed local elected officials on their thoughts on the unlimited donations and how to address them in future elections—using the Flater-Gallaher storyline as the jump-off.

The defamation complaint names the Press Democrat, the corporate owners Sonoma Media Investments, reporter Kevin McCallum and Sonoma State University political scientist David McCuan as defendants (along with 20 unidentified John Does). The complaint seeks unspecified monetary damages and charges the paper with defamation, libel per se and portraying its clients in a false light.

The complaint followed a letter sent to McCallum and Press Democrat executive editor Catherine Barnett by Miller on Nov. 21 that demanded the paper retract six stories that he alleged contained defamatory comments against Gallaher and Flater. When the paper didn't retract the stories, they sued.

The complaint highlighted a Nov. 5 article that reported, "Mr. Flater's spending spree . . . has telltale signs of someone who has agreed to act as a front man for other donors, allowing them to shield their political contributions and potential economic interests in the race from public view."

McCuan was included in the complaint, and he was also sent a letter from Miller, partner at the Santa Rosa firm of Perry, Johnson, Anderson, Miller & Moskowitz, for quotes he provided to the Press Democrat that furthered a running theme that Gallaher was likely the hidden hand behind the contributions. An Oct. 28 story highlighted ongoing donations from Flater, as it noted Gallaher's work as a developer in Santa Rosa as "one of the city's most successful developers."

According to media reports and documents on file with the city of Santa Rosa, Gallaher is involved in a years-long negotiation with the city to build the "Elnoka" project on land adjacent to Oakmont Village. As it laid out its reporting on the Flater contributions, the Press Democrat reported that a proposed project comprising 447 units had already been rejected by the city. The latest updated Elnoka proposal, as first reported in the Kenwood Press, was submitted to the city last October and nearly doubles the proposed units to a 778-unit retirement community.

The Press Democrat noted that Gallaher, his wife, daughter and son-in-law all contributed the Santa Rosa legal limit of $500 to Tibbetts.

Tibbetts told the Press Democrat on Oct. 28 that he had never met Flater and believed that the donations were "part of a bundle" of contributions to other city council candidates. He told the paper the $62,675 Flater had by then spent on mailers and canvassing for him was "a disgusting amount of money to come into a local race," even as he accepted the support.

Teeing off on the Tibbetts "bundling" assertion, McCuan told the Press Democrat in that same Oct. 28 report that the alleged bundling was part of "a pattern Gallaher has of 'sprinkling money around' to family members to maximize payments to—and potentially influence with—council candidates."

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