Senate President Pro Tem Darrell Steinberg, D-Sacramento, worked for a law firm representing the son of a health care executive linked in an FBI affidavit to Sen. Ron Calderon, D-Montebello.
In response to a leaked FBI affidavit charging that Calderon had accepted $28,000 in bribes from Michael D. Drobot, formerly the CEO of Pacific Hospital of Long Beach, Calderon's attorney sought to deflect blame this week in a court filing claiming that Steinberg was the true target of the investigation given his "financial activities" with Drobot.
On Thursday, Steinberg repudiated Calderon's allegations, calling them "beyond the pale" and saying he had "no relationship" with Drobot, outside of the fact that the prolific Democratic donor had attended Senate Democratic fundraisers.
But Michael D. Drobot has a son, Michael R. Drobot, who is currently being represented in an insurance fraud case by a law firm, Roxborough, Pomerance, Nye, & Adreani, that Steinberg listed as a source of income in a filing covering 2012. Steinberg is an "attorney of counsel" for the firm, according to the filing, and received between $10,001 and $100,000 in 2012.
Attorneys from the firm are representing the younger Drobot in a lawsuit California's State Compensation Insurance Fund brought against both Drobots, father and son, earlier this year alleging "a broad and multi-faceted plan to defraud State Fund in connection with the submission and collection of fraudulent insurance bills."
Steinberg started working for the firm last year but severed his affiliation on Thursday after learning that the younger Drobot had become a client, according to spokesman Mark Hedlund.
"He became affiliated with them on a very limited part-time basis last year and was going to be developing a mediation practice with them," Hedlund said, adding that Steinberg's schedule has prevented him from spending much time on the project.
In a November 14 email to Nicholas Roxborough, an attorney at the firm, Steinberg resigned his position, writing that " given that my good name has been unfairly dragged into the Calderon mess and Drobot senior, I am concerned about any appearance of a connection, even though there is not one."
The state insurance fund's complaint alleges that the Drobots and a web of companies they oversee have sought to defraud the state fund by overbilling for surgeries and by erecting "shell companies" used to inflate the price tags of medical devices for which the Drobot-affiliated companies seek reimbursement.
An affidavit given by an undercover FBI agent depicts a similar scheme. According to the document, Michael D. Drobot funneled money to Ron Calderon and his brother, former Assemblyman Tom Calderon, so they would preserve certain provisions in California's worker compensation laws allowing Drobot to reap more money from spinal surgeries. Drobot's lawyer has said the allegations are baseless. The affidavit mentions only Michael D. Drobot, the father, not Michael R. Drobot, the son.
"Drobot and others had conspired to use the existing provisions in the worker's compensation laws, as well as several other means, to commit widespread health care fraud, including paying illegal kickbacks (or bribes) to surgeons performing spinal surgeries at (Pacific Hospital Long Beach)," the affidavit alleges.
PHOTO: Senate President Pro Tem Darrell Steinberg, center, and the Senate Rules Committee voted unanimously to strip Sen. Ron Calderon of all committee assignments on Tuesday, November 12, 2013 at the state Capitol in Sacramento, Calif. The Sacramento Bee/Randy Pench.