People v. Reed CA1/3

── People v. Reed CA1/3 ── Court: California Court of Appeal Date: May 12, 2026 Category: General Filed 5/12/26 P. v. Reed CA1/3 NOT TO BE PUBLISHED IN OFFICIAL REPORTS California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115. IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA FIRST APPELLATE DISTRICT DIVISION THREE THE PEOPLE, A170827 Plaintiff and Respondent, v. (Contra Costa County WILLIAM J. REED. Super. Ct. No. 051819838) Defendant and Respondent. William J. Reed, an attorney, appeals from a judgment entered after a jury found him guilty of embezzling $400,000 in settlement funds from two sets of clients—John Stone and Kristine Turner (the “Stone-Turners”) and Marlene and Herb Schuler (the “Schulers”) (sometimes referred to collectively as “plaintiffs”). Reed contends that the trial court committed instructional and other errors during the trial and that insufficient evidence established plaintiffs’ ownership of the settlement funds. We affirm. FACTUAL AND PROCEDURAL BACKGROUND1 In October 2023, the Contra Costa County District Attorney charged Reed with two counts of grand theft by embezzlement (Pen. Code, § 487, 1 We summarize only the facts and proceedings relevant to the issues raised on appeal. 1 subd. (a); all unlabeled statutory references are to this code). The first amended information also alleged the offenses constituted a white-collar crime scheme that resulted in a taking of over $100,000 in property (§ 186.11, subd. (a)). At trial, there was no dispute that Reed represented plaintiffs in a lawsuit against PG&E and that he received a $200,000 settlement on behalf of the Stone-Turners and a $200,000 settlement on behalf of the Schulers. There is also no dispute Reed kept all of the funds for himself, claiming he believed in good faith that the entirety of the settlement proceeds was rightfully his. A. Prosecution Case In 2006, a major wildfire (known to some as the Zamora wildfire) occurred in the Woodland area. One of the wildfire victims, David Hatanaka, consulted with Reed about suing PG&E for damages. During these discussions, Reed informed Hatanaka that Reed’s attorney fees “wouldn’t come out of [the] settlement but would be paid by PG&E.” Reed asked Hatanaka to help gather other wildfire victims for a lawsuit and provided Hatanaka with drafts of letters inviting victims to come together to seek recovery from PG&E. Though Hatanaka did not write the letters, he reviewed and sent them out on his own letterhead. One version of this letter (the “Hatanaka Letter”) stated: “ ‘And on top of this, PG&E must pay all of our attorney’s fees, expert fees, and court costs necessary to get this fair payment, not the usual attorney fee charge of a third or 40 percent taken out of the settlement amount.’ ” The Hatanaka Letter also informed community members of a town hall meeting that would take place on June 28, 2007. 2  On June 28, 2007, Reed attended the town hall meeting along with two local attorneys. During the meeting, Reed represented that any settlement with PG&E would not be reduced by attorney fees, which would be paid separately by PG&E. Around September 2008, Reed sent Hatanaka a representation agreement. Section 4 of the agreement, titled “Legal Fees and Costs,” stated: “You agree that the reasonable value of my services will [sic] at the hourl