San Diegans for Open Government v. Har Construction CA4/1

Government Code section 1090 prohibits public officers from having a financial interest in any contract “made by them” in their official capacity. (Gov. Code, § 1090, subd. (a).) If a public official violates section 1090, the public entity is entitled to recover compensation paid under the contract without restoring any of the benefits received by the contracting party. A taxpayer has standing under certain circumstances to bring a section 1090 action to recover this money on behalf of a public entity.

In this case, San Diegans for Open Government (SanDOG) filed a Government Code section 1090 taxpayers’ action on behalf of the Sweetwater Union High School District (District) seeking to recover contract payments made to three building contractors, including appellant Har Construction, Inc. SanDOG alleged the District superintendent and several District board members were “financially interested” in the public works contracts and thus the contracts were void. (Gov. Code, § 1090, subd. (a).) About 16 months after SanDOG filed its first amended complaint, Har Construction moved to dismiss the complaint under the anti-SLAPP statute. (Code Civ. Proc., § 425.16.) The court…