Salt Lake Mayor Deedee Corradini and her husband bought their way out of one Bonneville Pacific lawsuit only to be hit with another.

Corradini, Ross and officers of Bonneville Group and Bonneville Pacific have been sued by investors who lost millions invested in a hydroelectric dam built by Bonneville Group near Twin Falls, Idaho.This is the first Bonneville Pacific-related suit to name Corradini as a defendant. But Corradini's attorney says the suit is "absolutely ridiculous" and he will ask a federal judge to dismiss Corradini and her husband from it.

A Seattle attorney and other investors sued Corradini, Ross, Carl T. Peterson, Raymond Hixson, Wynn Johnson, Robert Wood and John T. Dunlop in a Washington federal court last spring.

The case was recently transferred to the U.S. District Court of Utah.

The investors erroneously named Corradini as a defendant because they believed she was an officer in Bonneville Pacific, said Harold Christensen, attorney for Corradini. "Everybody in Utah knows she wasn't," he said. "I called the lawyer and told him Ms. Corradini had never been a director or officer of Bonneville Pacific and asked him to drop her from the suit," Christensen said. He also mailed state documents to the attorney that he said proved Corradini had no formal involvement with Bonneville Pacific.

But she hasn't been dropped from the case.

"In the securities offerings, Ms. Corradini was listed as a director of the company," said Michael Shaffer, attorney for the investors. "Mr. Christensen sent me some documents indicating she was not.But Bonneville Pacific's own records indicate she was. We can't drop her from the suit until we know for sure she wasn't a director."

The securities offering reads, "Deedee Corradini is a director of Bonneville and she is an executive vice president of Bonneville Group Inc." "Our investors are intelligent and responsible people. They were told she was a director in the company. . . . She had a very impressive resume and that lent some credibility to the project. If someone falsely told them she was a director of Bonneville Pacific when she wasn't, I want to know why that false statement was made and I want to know whether she knew of it."

Christensen countered: "She didn't know about it. She had nothing to do with the preparation of that offering."

"The real question is whether Ms. Corradini and Mr. Ross met their responsibility under federal and state securities laws," Shafer said. Corradini's technical role at Bonneville Pacific is beside the point, he added.

Not so, Christensen said. The only allegation in the suit against Corradini is that she was an officer in the company. "So they have no case against her."

Corradini and others are accused of violating those laws as well as Washington's Consumer Protection Act.

Investors accused Corradini, Hixson, Wood, Johnson, Dunlop and others of preparing false documents to entice them to invest in the Twin Falls dam.

Approximately 100 investors poured $6,750,000 into the project, according to court documents. The investors and Bonneville Pacific borrowed an additional $10,200,000 to construct the small dam.

The securities offering allegedly prepared by Bonneville Pacific insiders in 1984 assured the investors that Bonneville Pacific would buy drought insurance that would make payments on the project during drought years.

If the Idaho area was hit by a drought, the investors would have trouble making loan payments, the offering says. But the limited partnership - called the Magic Valley Hydroelectric Limited - would buy "low flow" insurance, which would make 81 percent of the debt payments during dry years.

Bonneville Pacific and former insider Carl T. Peterson were general partners in the limited partnership. Peterson is best known to the public as the man who took more money - $14 million - out of Bonneville Pacific than any other insider.

Bonneville Group - a company Corradini was a director of - would manage the project, according to the securities offering.

The investors contributed to the project, believing that Bonneville Pacific had bought the insurance, the suit says. But Bonneville Pacific didn't buy the insurance. In fact, "low flow insurance" wasn't available, the suit says.

When Idaho was hit by dry years, the limited partnership couldn't make loan payments and the project was ultimately lost. Investors received a small percentage of their investment back in a 1992 settlement.

Before the Washington investors drop Corradini and Ross from the suit, they want to learn from Dunlop, Hixson, Wood and Johnson exactly what role Corradini played in the fraudulent securities offering, Shaffer said.

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Ross is only named in the suit because he is Corradini's husband and under Washington law, husbands can be held liable for a wife's financial obligations, Shaffer said. The investors also sued the wives of the Bonneville Pacific insiders, the Chicago law firm that did the legal work for the project and an early limited partner, James Ellsworth, and his wife.

Last summer, Corradini paid $458,000 to Bonneville Pacific trustee Roger Segal in exchange for Segal's assurance that she wouldn't be named as a defendant in the massive suit Segal filed against dozens.

The money will be distributed to Bonneville Pacific creditors.

The suit will go to trial before U.S. District Judge J. Thomas Greene.

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