EX-FLEISHMAN-HILLARD EXEC APPEARS IN COURT.

Byline: Beth Barrett Staff Writer

Doug Dowie, the Fleishman-Hillard public-relations executive who became an insider in Mayor James Hahn's administration, sat handcuffed Friday in a downtown federal courtroom accused of conspiracy and of defrauding the Department of Water and Power of at least $300,000.

Dowie, 57, of West Hills, who has denied the charges through his attorney, sat in the front row behind a short, glass partition among at least a dozen other federal criminal defendants making their initial appearances before Magistrate Judge Jennifer T. Lum.

Wearing a blue and white-striped shirt open at the neck, Dowie, a former journalist who ran the P.R. giant's Los Angeles office, sat expressionless most of the time as he waited to be called by the judge. His face sometimes flushed as reporters took notes, and an artist for a television station sketched his likeness. A few times, he dropped his head into his hands.

Dowie, who turned himself in to the Federal Bureau of Investigation in the morning and was processed by U.S. marshals, was allowed to post a $75,000 unsecured appearance bond for his release based on his ``long- standing ties'' and roots in the community. He handed over his passport to the court.

``Yes, your honor,'' Dowie responded in a strong voice four times as he was asked whether he understood the indictment, as well as the conditions of his release including restrictions on travel and that he actively seek employment.

Arraignment is set for Monday. He was indicted Thursday by a federal grand jury on 16 felony counts of fraud and conspiracy in connection with allegedly bilking the DWP and other clients.

City Hall, where Dowie was a well-known figure, buzzed over his indictment though officials who once counted him inside their circle now were keeping a distance.

The indictment supersedes an earlier indictment of Dowie lieutenant John Stodder, 49, of Palos Verdes Estates, who also was fired by Fleishman- Hillard. Stodder has pleaded not guilty to 11 counts of wire fraud under the original indictment, with the new one containing the wire fraud counts as well as one of conspiracy.

``We're very disappointed the government would go this route,'' said Michael Farhang with the law firm Gibson Dunn & Crutcher, the attorney representing Dowie. ``He's looking forward to his day in court.''

He faces a maximum penalty of 245 years in prison, based on up to 20 years on each of 11 counts of wire fraud and five years each on the conspiracy charge and remaining fraud counts, although he likely would receive only a couple of years in federal prison if convicted on all or most of the charges.

Fleishman-Hillard, which held a $3 million-a-year contract with the DWP as well as smaller contracts with the Harbor and Airport departments, agreed to pay the city nearly $6 million to settle a lawsuit over the alleged overbilling. The firm has distanced itself from possible criminal wrongdoing, and has said it is fully cooperating with prosecutors.

Assistant U.S. Attorney Adam D. Kamenstein declined to discuss details of the case, but said the firm's civil settlement with the city had no bearing on the government's criminal case.

``One is civil and one is criminal,'' Kamenstein said. ``The fact that Fleishman-Hillard settled a case with Los Angeles is completely independent.''

Dowie joined Fleishman-Hillard in 1991 after leaving the Daily News where he was an editor for five years. A senior partner in the firm and general manager of its Los Angeles office, he filed a wrongful-termination lawsuit against the company in March claiming he was made a scapegoat. His attorney in that case asserted he had passed a polygraph test.

Beth Barrett, [phone]

beth.barrett(at)dailynews.com

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