Who’s bankrupt?

An Open Letter to Costa Mesa Blogger Geoff West

Geoff: They used to say journalism is just first-draft history, that daily and even weekly deadlines don’t give reporters the kind of chronological distance that actual history1 requires. But in the case of this post, the first draft has taken a month and a half, a fact that means it should read like something from the Oxford University Press. It doesn’t.

But even this late in the day, the subject is worth considering, bearing as it does on the First Amendment, laws of logic, the reputation of Councilmember Steve Mensinger and, by extension, the pension battle in Costa Mesa. At least three of those subjects are evergreens; I’m not sure anyone cares about logic anymore.

Our story begins with a June 11 “Bubbling Cauldron” post in which you claim that Mensinger and his council colleague Jim Righeimer are going to destroy the city of Costa Mesa by employing a black-magic combo of Republican incantations (a “mantra,” you call it) and the “skills that they used to ride two divisions of SunCal Companies into the ground.”

You even imply that your insight isn’t really much of an insight, that what Righeimer and Mensinger are doing in facing down the public employee union leadership over pensions and such is obviously/outrageously evil/criminal/dangerous. “It’s really hard to imagine that they really think the public is so blind and stupid,” you write, puzzled, in a way that sounds as if you think we (the public) are equipped with doctorates and X-ray vision. But, no, that can’t be right because by the end of the same paragraph it’s pretty clear that you—Geoff West—believe we (the very same public) are in fact “blind and stupid”: “I’m not sure what it’s going to take for the voters of this city to wise-up.”

But I’m less interested in your measure of our intellect vis-à-vis your own (which, well, wow), and more compelled by your claim that Righeimer and Mensinger destroyed “two divisions of SunCal Companies.” Because that discovery would be like 64-point Helvetica bold news if it were true, the local news equivalent of a moon landing: if the guys who claim they can balance Costa Mesa’s budget have actually cratered (not just one but) two companies, well, brother, that’s a killer story.

But in that June 11 post, you didn’t provide any evidence to support the claim, and reading it made the dentate rows in the mouth of the internal editor in me just clench in the kind of terror rictus that immediately precedes (in my case, anyhow) pants-wetting. Because as I read it, your claim includes at least two of the three components of libel—it’s defamatory and it’s published—and I’m here to tell you that I think it also includes the third: it’s false.

I’m not alone in that opinion. On July 1, you told your readers that an attorney representing Mensinger had notified you that Mensinger believes “[t]his statement is demonstrably false and defamatory. No company Mr. Mensinger has been an employee of, including the division of SunCal that he managed, has ever gone bankrupt.”

Mensinger’s attorney went on to demand a correction. And that’s when you made your second mistake: you doubled down.

“Although I already knew that his accusations were specious, I spent a little time browsing the Internet and in a very short time I found more than 20 articles that verified the facts,” you write. “SunCal Companies has been mired in bankruptcy proceedings for several years, and those proceedings include the Multifamily Division of which Mensinger had been president. In addition, Mensinger was also a Division President with The Bethany Group before he went to SunCal, and that company also filed for bankruptcy.”

I mean, Geoff, you’ve either got just the largest brass-coated reproductive organs in the world or a huge bank account or both. Because in this passage you (a) indicate that you’ve relied exclusively on the Internet for your research, (b) refuse to acknowledge your first error, and (c) claim that you’ve stumbled across additional evidence to support your claim that Mensinger’s a one-man suicide bomber where real estate activity is concerned. And you say all this (“specious,” “a little time,” “browsing,” “a very short time”) in a way that’s calculated to suggest that proving your original claim (Mensinger wrecked SunCal) was easy, merely the kind of thing you do when you’re not smashing atoms in your home office or working out Goldbach’s conjecture.

But your proof doesn’t prove what you think it does. A great deal of research on my part helped me figure out what I think you’re really seeing.

Like a lot of companies, SunCal does its best to build firewalls between its many real estate projects by incorporating each as a separate business (they’re called “special-purpose entities”) so that a financial disaster in one doesn’t set off a world-ending conflagration that burns down the entire company. In SunCal’s case, the strategy worked as planned: when Lehman Brothers, SC’s partner in some 30 S-PEs, melted down in 2008, the damage was limited to those 30 or so entities. SunCal sought BK protection in those cases, working to extricate itself from the Lehman mess in order to restructure the deals and move forward.

But what’s your evidence that Mensinger caused any one of those BKs? Or, more to the point, that the entire division he managed went BK?

I can’t find any. So, I called SunCal, and spoke with David Soyka, the company’s senior vice president for public affairs.

Is SunCal bankrupt? Absolutely not. It’s not now and it never was. How about the division Steve Mensinger headed—the Multifamily Division? Did that go BK? That’s laughable. Laughably true? Absolutely untrue. Multifamily was shut down when the real estate market went upside down. How about some of Multifamily’s special-purpose entities? It never had any. The market tanked and we closed the division before it created any special-purpose entities. Reading Geoff West’s blogpost, Mensinger seems pretty dangerous–not the sort of guy you’d want around sharp knives or your checkbook. Steve is a great guy—a very knowledgeable guy, very experienced. Everyone here would say the same thing. He was very respected. Same with [Jim] Righeimer. Their departure was about the marketplace, not about their performance. Steve happened to be working at SunCal during a housing crisis unlike anything we’ve seen in this country since the 1930s. Like about 400 other people, all of them doing very good work at SunCal, he’s not working here now. When we see a recovery in the market, we’d like to work with him again. But this blogger says you guys went bankrupt. He’s pretty adamant about that. I’ll have to check with our corporate counsel, but we might take action against him on something like that. It’s absolutely false. Maybe he can show me some proof? You should ask him to show you the documents that show SunCal is bankrupt. He can’t, because there aren’t any. It’s an absolutely false claim. It’s crazy.

“Crazy”? The Bethany case you cite seems even more mental: see, Mensinger left Bethany in 2007, about two years before that company ran into financial trouble. You might just as reasonably argue that I was a harbinger of great evil because my birth (April 11, 1960) preceded by just 16 months the construction of the Berlin Wall and by three years the JFK assassination.

I’ve written before about the dangers of this brand of bad logic, so I won’t bore you with a reprise, except to say that just because one thing (e.g., my birth) precedes another thing (e.g., JFK’s assassination) does not mean that the first thing caused the second. Mensinger and Righeimer’s presence at a company that might have subsequently experienced financial trouble is not evidence that Mensinger and Righeimer drove “two divisions of SunCal Companies into the ground.” Establishing chronology is a snap; proving causality is trickier, and asserting it sometimes leads to libel suits.

I suspect you know all this–that despite your brave claim that you easily confirmed the facts that support your claim, it’s possible you realized your pants pockets were (evidence-wise) quite empty. Because you seem to develop mid-post an unusual (for you) sensitivity to the post-hoc problem. This newfound subtlety of mind emerges near the end of your July 1 piece, the post you begin by saying you’re not wrong, that Mensinger’s lawyer’s a “pit bull,” that Mensinger himself is a “bully.” “Clearly,” you write, “this is just one more attempt to silence a critic and, as I’ve said many, many times before, neither Mensinger nor Righeimer likes criticism.”

But that’s not where you end the post. Because, suddenly, you write in a way that suggests that it’s not so “clear” that this is just censorship. Your evolving explanation of Mensinger’s alleged bankruptcies at SunCal and Bethany is worth quoting at length:

The record does demonstrate that two companies in which he served as President subsequently filed for bankruptcy. I don’t know how much his presence at either of them contributed to those situations, but I imagine there are folks around who worked with him in those companies who could offer opinions. In my business experience, the President of an organization typically sets the course for the company and, in many cases, takes the helm and steers the organization on that course, making whatever corrections are necessary. I don’t know if he set the course to take them over the bankruptcy falls or not. Nor do I know if his hands were still at the wheel when they went over the brink.

See, now you “don’t know” if “his [Mensinger’s] presence” “contributed to those situations.” And because you don’t know, you’re left to “imagine.” You extrapolate from your own “business experience” to assume how “an organization typically” works. But again (you say) you “don’t know” if that’s how it worked at SunCal or Bethany, “nor do [you] know if his [Mensinger’s] hands were still at the wheel” or (switching your vehicular metaphors here) “if he [Mensinger] set the course” of the marine craft that eventually went “over the bankruptcy falls,” etc., etc., etc.

That’s a lot of stipulation, and a hell of a long way from June 11. It’s just as long from where that same blogpost begins—with you being absolutely 100 percent right. And so I wonder if you wouldn’t have been wiser to simply say what’s likely true: that in your rush to dredge up dirt on a man whose policies you abhor, you got the story wrong–that the truth is Mensinger hasn’t wrecked two companies. He hasn’t even wrecked one.

Now, being wrong doesn’t mean that Mensinger ought to sue you for libel. I’m a First Amendment absolutist, so I don’t think anyone—especially a public figure—should sue for libel. The First Amendment says (in part), “Congress shall make no laws . . . abridging the freedom of speech, or of the press”—not, that is, “Congress should make some laws, or impose some reasonable restrictions, etc.” It says “no laws.” As the Bill of Rights goes, this is far more obvious and declarative than the Second Amendment about which your rifle-toters are generally so doggedly insistent and, of course, wrong.2

The good news is that there’s nothing inherently bad in being wrong. We’re all wrong sometimes. And readers (good ones, anyhow, grownups) often appreciate the sort of humility/honesty/candor that allows a writer to admit his mistakes. Ironically, declaring you’re wrong allows readers to know they can trust you to tell the truth. To say anything else—to spend 1,429 words talking about your free-speech rights, your courage as a critics, Mensinger’s putative authoritarian style, his bully-boy mentality, Righeimer and Mensinger’s “willingness to intimidate and threaten those who disagree with them,” to speak of the “genetic flaws” in their party, R&M’s threats, impatience, “short fuse,” and sometimes all of this at once (that M is “an impatient authoritarian and, sometimes, a bully”)—none of this makes you sound like Tom Paine. It makes you sound like a pain in the ass.

I said that readers are forgiving of our mistakes. But that’s not always true: when we insist we’re right even in the face of counter evidence, readers cease to regard us as trustworthy commentators. And where your side is concerned, there’s an unwillingness to deal honestly: I’m still waiting for Orange County Employees Association spokesperson Jennifer Muir to correct her sprawling catalogue of misstatements. But candor is in limited supply over there. One might even say they’ve run out of the stuff–that, in its own way, the union leadership and its allies in the blogosphere are themselves bankrupt.


1. I.e., with footnotes.

2. I know the Supreme Court only recently decided I’m wrong on this, but I’ve got a kind of obsession here. The Second Amendment reads, “A well regulated Militia, being necessary to the security of a free State, the right of the people to keep and bear Arms, shall not be infringed.” First, our forefathers were easily wigged out by large standing armies; in the absence of an army, they needed well-regulated militias–not just any militias, mind you–to protect the state. The inclusion of the phrase “well regulated Militia”–inclusion that required really awkward sentence structure, by the way–suggests to me (not the SC) a very narrow context for gun rights.

15 responses to “Who’s bankrupt?

  1. CM Mesa North

    Do Geoff West and Repair Costa Mesa use the same fact checker?

  2. Wow! This expose was a real eye opener, and so full of truth. The title “Who’s Morally Bankrupt?” would have been equally appropriate, and very descriptive, to say the least.

    You are one brave soul Will, and no one can say you aren’t willing to tell it like it is. Both Geoff West and Greg Ridge (aka Gericault) love to stretch the truth beyond all logical and moral boundaries.

    Unlike you, I think our well meaning city councilmen should file libel and defamation lawsuits. The character assassination of Jim Righeimer and Steve Mensinger has been absolutely OFF THE CHARTS for the past few years.

    I’ve been patiently waiting for some kind of blow back because speech is only free until you hurt someone; then the courts will step in. Families are forced to suffer the ravages of defamation right along with the intended targets. That is cruel and unusual punishment that doesn’t fit a crime not even committed.

    If it weren’t for the kindness of people in Costa Mesa, Geoff West and Greg Ridge would be getting back exactly what they give. Both men have lost sight of the Golden Rule: “Do unto others what you would have done unto you.”

  3. John Vanderlay

    Swaim is correct. Too bad he didn’t write about something else and just ignore West. We should all ignore him, which would be the best possible punishment for Costa Mesa’s biggest little mind.

  4. Will, Will, Will. Agreed on everything ‘cept the gun rights…. The bill of rights in my opinion is mandating a well regulated militia and further stating that no man’s right to bare arms be infringed… one might even accurately infer that we are not free unless we exercise these specific freedoms.
    btw, standing armies freak me out too😉

    • Jeff: Thanks for the response. Intelligent minds can disagree on this one obviously, or else we wouldn’t have the founding fathers–and our own Supreme Court (literally) making a federal case out of it. But what’s weird is the way in which this amendment is structured. Notice how it’s the only place in the Bill of Rights in which the FFs explain why a right is necessary: they don’t say anything remotely like it, don’t offer a justification for any of the enumerated rights except this one–and then they don’t just add that justification as an afterthought but as a preface. It’s as if they’re saying by the very structure of the Second Amendment that the most important thing about gun ownership is that it follows from (a) the necessity of a well-organized militia to (a) the preservation of a free state. Why is the well-organized militia even mentioned if (as Second Amendment absolutists argue) it’s sort of beside the point? And if the WOM is in fact beside the point, why didn’t the FFs just add gun ownership to the First Amendment where, along with speech, religion, assembly, and petition, the FFs didn’t find it necessary to justify their prohibition on any federal government interference?

  5. John Vanderlay

    FYI: West called your open letter “drivel” and refuses to respond.

  6. I don’t understand douche so let me get this straight… Bethany Group and SunCal both filed for bankruptcy right? That means they had to prove to a court of law they were going bankrupt right? I think even the author of this article would admit all of that is true. So when Steve Mensinger says he wants to run Costa Mesa like a business, let’s all hope it’s not like Bethany Group or SunCal.

    Geoff West is right in not responding. This is douche journalism.

    Put Jim Righeimer and Steve Mensinger on a lie detector and ask them if they tried to manufacture a budget crisis to get out of contracts. They are the ones to ask. Go directly to the source or end up being a sad excuse for a newspaper.

    • @Jackson – obviously it is hard for you to grasp how companies are structured. Did you even read Will’s interview with the Sr. VP of Pulic Affairs? Will quoted him, on record. Geoff did not use any credible sources, he used the same fact checkers as Repair Costa Mesa and Jennifer Muir. You continue to take much of Geoff’s “journalism” as fact when 99% of his drivel is opinion. Hook him up to a lie detector.

      • CM Mesa North, you agree though that Costa Mesa shouldn’t be run like Bethany Group or SunCal? I mean, having to prove to a court of law you are spending more than you are taking in is not a good sign of health. Kind of like the situation the state and federal government is in right now.

        When did I say I was a Geoff West supporter? I just think the story is disingenuous like the unions and our council. Everyone knows Righeimer is stretching the truth like a lawyer and then some. It’s just bizarre to see someone that claims to be a journalist not get that.

        I might not be a union supporter, however, I don’t want the council to outsource to contractor friends that hire illegal immigrants and do a worse job. Conservative values are usually about local control ie. states rights over federal rights. I’d rather have our own police force and our own fire department. Since we have a lot of crime here, it makes sense we need an above average police force relative to Newport Beach that has less crime. Righeimer ruined all of that. Plus, he’s for more HOA style rules and regulations which is a crime in this town as far as I’m concerned. The rest of the council wouldn’t be this bad if Righeimer never won.

        Not liking unions and outsourcing are two different things. This wouldn’t be an issue if union employment contracts were never signed and some employees weren’t making a little too much money. So, in some ways I, am for running Costa Mesa like a business, just not the ones Mensinger worked at.

  7. The lack of response from Geoff West gives you tremendous credibility Will. If you were wrong, trust me, you would have heard from Geoff!

  8. Actually, since we’re dealing with public officials here, you need to be able to prove actual malice to sue for libel. That West knowingly published information he knew was false. Since West doesn’t believe the information was false based on his research, the city council members are going to have a difficult time proving actual malice.

    • Dan’s right to say that, where public officials are concerned, judges sometimes require evidence of malice (New York Times v. Sullivan). While “malice” may mean pre-publication knowledge that information was false (as Dan says), it may also mean a reckless disregard for truth (which Dan doesn’t). And w/r/t Mensinger, Geoff’s site is a catalogue of reckless, and reading it is (for any journalist or editor who ever worked closely with libel attorneys over the course of more than a decade and published very competent and aggressive investigative reporters) like walking through the Torture Museum in Rothenburg ob der Tauber which, even without the abundant translations, is just lower-GI-convulsing and fantods-inducing. Seriously: go in there (West’s blog, not the museum, though that, too) and take a look at the months-long context surrounding the incident in which Geoff misfires on SunCal. If this were an isolated event regarding a public official in, say, the U.S. Senate? Maybe no evidence of malice. But Mensinger’s also (and mostly) still a private citizen with a salary to earn, and the false accusation—published not once but twice, and then after a written request for retraction—that he piloted a company into a hillside is damaging to the work Mensinger needs in order to handle his part-time obligations on the council.

      But please hold onto my broader point here, which Dan seems (maybe) to have lost (which, if so, my fault)–and it’s not that Mensinger should sue; he should not. I’m a First Amendment absolutist the way Geoff’s friends on the right are just monomaniacal about the Second vis-à-vis gun rights, so I don’t think anyone—esp. a public official—should sue. It’s that Geoff West occasionally just pops off (breathlessly) without evidence to back up his claims. And he has a predictable way of doing so: Notice the breezy way he segues from not knowing something (e.g., whether Mensinger chest-bumped someone at a public event) to establishing a context for believing he does (“I’ve never thought of [Mensinger] as a particularly slow learner—a bully—yes, but a slow learner—no.”) You can play this game on your own, at A Bubbling Cauldron. Aber Vorsicht: Es ist dort unheimlich!

  9. It is rare to find anybody, let alone a journalist, who has a reputation for strongly supporting one side of the political spectrum, but has the conviction and strength to vigorously support the other side when a specific situation arises. Will Swaim has done just that. When that rare event happens, it causes me (and I suspect I’m not alone) to pay more attention to the man’s documented points. It also is convicting in that it provides a positive example for all of us to be a bit more objective and willing to examine BOTH sides of controversial issues before automatically siding with those who reflect our usual liberal or conservative views.

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