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Cagey: The former mayor of Milpitas uses the title esquire and lists himself as an officer for a defunct company.

Disclosing Henry Manayan

Assembly seat seeker screws up tax forms and résumé, ticks off state regulators but says he's working out the kinks

By Allie Gottlieb

EXACTLY how much Henry Manayan broke the law is a matter of contention. Three and a half weeks before the March 2 state Assembly Primary, the slight, fresh-faced former Milpitas mayor sips iced tea and steals bites of his Coco¹s sandwich while explaining the discrepancies that dot his political and professional persona.

"Honestly, the only thing I've been guilty of is turning in my forms late," Manayan says, referring to the Statement of Economic Interests form he failed to file as he was leaving the Milpitas mayor's office in time for a Jan. 3, 2003, deadline. "There was one time when it was very hectic when I was leaving office, and I was taking a trip to see my family and I'm pretty sure I mailed it from the San Francisco Airport."

The Fair Political Practices Commission sent Manayan a letter in March demanding that he complete his financial disclosure form, a statement of investments, property, loans, gifts and other interests legally required from public and campaigning officials. He was told to send it to the government office along with a $100 late fee. In April, the commission forwarded the yet-unresolved Manayan case to its enforcement division, which has the authority to charge up to $5,000 for each offending count. As of Wednesday, Feb. 4, the commission still hadn't received Manayan's form, spokesperson Stephanie Dougherty said.

In his defense, Manayan says an Fair Practices representative paid him a friendly visit during the last week of January and left promising to recommend not filing charges for the gaffe.

If this were the only confrontation the Assembly aspirant has had with the government, or the sole gap in his legally mandated financial disclosure record, or if Manayan didn't raise ethical eyebrows by appearing to be a lawyer when he's not one, the result might be different. As it is, even his best friends won't excuse his mistakes.

John McCain

Milpitas Councilmember Bob Livengood worked with Manayan during his six years as mayor. Livengood supports Manayan¹s candidacy and considers him a "gracious" and "very effective" official. He agrees with Manayan that busybodies supporting his opponents in the race are just shooting off the typical opposition research that finds its way to the media the last month before any election.

"Economic development in the city was his legacy," Livengood says, adding that Manayan and he share a pro-business, fiscally conservative and socially progressive political ideology that commonly earns them the classification of moderate Democrat.

Still, Livengood says, "There isn't a really good excuse for not filing these forms. ... It's a legal issue. The law says you have to file these forms by a certain date."

Financial disclosure is a big deal because it means officials must reveal who brings home their bacon and to whom they feel indebted. It's a topic with enough magnetism to periodically galvanize such presidential campaigns as John McCain's. Even so, a single failure to fill out paperwork typically intrigues only beige bureaucracy wonks. But Manayan messed up his economic-interest form again this election cycle. He filled out the paperwork on time; however, he neglected to list any income from 2003 or a complete report of his stocks. He cited only stock in Cisco Systems worth between $10,000 and $100,000. On Feb. 5, he filed a new economic-interest statement, adding stock in Applied Materials, Linear Technology, E-Trade Financial Corp., AT&T, MD Vista.com and iRise.com.

Nevertheless, Manayan maintains that he earned no paychecks last year. He doesn't think the public should get to peek at his personal finances. He says that though he doesn't like to brag, he's wealthy enough from previous investment gains not to have had to cash any checks.

That said, not all of his business ventures were successful. The State Franchise Tax Board shut down three of the 20 or so companies he started because "he stopped filing his taxes in 1994," according to the Fair Practice Commission's Dougherty.

So it was curious when the résumé on Manayan's campaign website, www.manayanforassembly.com, listed his job from 1990 to the present as president and CEO of Transpacific Capital Corp, a company whose corporate status the tax board suspended in 1995. Manayan updated his résumé last week and changed the name of the company to the Transpacific Companies. He also provided the new name on his updated economic statement. The address and description of the companies remain the same. Manayan says he started the Transpacific Companies last year but hasn't made any investment deals yet. That would explain why he didn't report earning any income from Transpacific yet. But it doesn't explain why the company name wasn't registered with Santa Clara County's recorder until Jan. 29 of this year.

Mystery Man

Manayan can't legally practice law in California even though he graduated from Santa Clara University with a juris doctor degree. He opts to use the title "esquire" on his résumé anyway. That, along with his degree, and a position he cites as general counsel with a Santa Clara company he owned, creates the appearance that he's a full-fledged attorney at law.

His history tells otherwise. Manayan, who was born in the Bronx, moved with his parents to Honolulu, Hawaii, as a kid and spent his elementary and high school years there with his extended, tight-knit family. He later moved back to New York, earning a bachelor's degree in political science and speech communications from Syracuse University. After completing law at Santa Clara law school, he returned to Hawaii where he passed the state bar. He has never passed the bar in California.

Santa Clara University law professor Gerald Uelmen, who has taught ethics, says there's no legal or ethical problem with someone using the term esquire in the state without holding bar status here. He also finds no problem with Manayan's title as general counsel for a private corporation. "It means you are the adviser for the company's legal affairs," he says. "You're not really seen as practicing law within the state."

But ethics experts disagree on those points. The California State Bar Board of Governors adopted a policy in the mid-'60s prohibiting the use of the general counsel designation by anyone who doesn't have current bar status in the state. It's a misdemeanor to advertise oneself as a lawyer without technically being one. State Bar officials are considering creating a certificate program for licensed attorneys from other states so that they can practice in California. The proposal is pending at the moment.

Mark Tuft, a trial lawyer with San Francisco's Cooper, White & Cooper LLP, holds the significant and annoyingly long title of vice chair of the State Bar of California Commission for the Revision of the Rules of Professional Conduct. His take differs from Uelmen's.

"That designation [of esquire] on stationery or business cards does convey to the public that that person is in fact a lawyer authorized to practice law," Tuft says. "The term general counsel also implies the position of lawyer." Tuft advises that someone who is technically not allowed to practice law should not use either of those terms.

Lien on Me

Ultimately, Manayan's professional and legal track record doesn't seem to alarm his high-profile endorsers. Which is ironic in the case of Assessor Larry Stone and state Controller Steve Westly. Westly, who heads up the Franchise Tax Board, declined to return calls about his candidate's adversarial relationship with the tax board. But Manayan says Westly hasn't demonstrated any concern.

Stone, on the other hand, who prides himself on being a champion for fiscal responsibility and the public disclosure of his own finances, actually defended Manayan's tax problems.

"It's not unusual to have liens filed against you when you're in development," says Stone, who met Manayan when he was president of the Arts Council, which Stone co-founded. "It's not good to have liens," he adds. In the '90s, the former mayor owed several thousand in back taxes, which Manayan says was the fault of a mortgage company that neglected to forward payments to another company that had assumed control of his loan. Stone notes that even he, the county assessor, has had a lien or two filed against property he owned because he refused to pay a contractor for performing what he considered to be inadequate workmanship. "It doesn't suggest any sinister behavior."

Manayan seemed somewhat nervous during the conversation. His hand shook a little as he stirred his iced tea, his body language was slightly rigid. He maintains that none of his tax problems, his late filing or the potential that he erroneously refers to himself in lawyeresque terms, indicates anything about his ability to competently represent the 20th Assembly District.

"This is typical last-minute stuff that comes up," he says. "That's a good sign when your opposition starts the negative attacks because that means that your opposition is threatened and they think you're going to win."


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From the February 12-18, 2004 issue of Metro, Silicon Valley's Weekly Newspaper.

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