Contractor, Cunningham staffers ordered before grand jury North County Times - North San Diego and Southwest Riverside County News

The defense contractor at the center of a San Diego federal grand jury investigation of U.S. Rep. Randy "Duke" Cunningham has been subpoenaed to testify before the panel.

Mitchell J. Wade, owner and former president of MZM, Inc., received the subpoena recently, a source close to the investigation told the North County Times on Monday. It was unclear when he was ordered to appear and the U.S. attorney's office in San Diego declined comment.

The jury is examining whether Cunningham, an eight-term Escondido Republican, improperly influenced the awarding of Pentagon defense contracts to MZM through his position as a member of the powerful House Appropriations Committee and its Defense Subcommittee.


Wade, whose 2003 purchase of Cunningham's Del Mar Heights home at an apparently inflated price triggered the probe, wasn't the only one to receive a subpoena in recent days as the pace of the grand jury's work accelerates. More staffers from the congressman's Washington, D.C., office also have been ordered to appear, another source close to the investigation told the newspaper.

Cunningham's congressional office spokesman Mark Olson declined to comment directly on that report. Instead, Olson issued a written statement saying that any additional subpoenas served on staffers did not have to be disclosed until the House returns from its August recess on Sept. 6.

"There have been no subpoenas disclosed to the House because the House is out of session until Sept. 6," Olson wrote. "Due to the sensitivity of your inquiry, I can't provide you with any more details."

House rules require public disclosure of subpoenas served on members of Congress or their employees.

K. Lee Blalack, the attorney Cunningham hired to represent him in the federal investigation, said Monday that the 50th Congressional District Republican has not received a subpoena from the grand jury.

Last month, Cunningham's legislative director, Nancy Lifset, was called before the panel, which began meeting in June under the direction of the U.S. attorney.

Blalack also confirmed that Cunningham sought permission from the House Committee on Standards of Official Conduct, also known as the ethics committee, to establish a legal defense fund.

If approved, donors would be allowed to make one-time contributions of up to $5,000 to that fund.

In addition to a legal defense fund, Cunningham has asked the Federal Election Commission for permission to use $672,000 in his campaign account to pay his legal bills, which his chief of staff, Harmony Allen, said could reach as much as $1.5 million.

Wade is being represented by the Washington law firm Wilmer, Cutler, Pickering, Hale & Door, which refused comment on the subpoena. An employee of the firm reached Monday who did not want to be named did not refute the report that Wade had received the subpoena.

Monday's disclosure of the latest subpoenas came as a North County-based group stepped up a signature drive calling for Cunningham's immediate resignation.

The left-leaning North County Unity Coalition is directing that effort and will conduct a news conference outside the congressman's Escondido district office on Thursday.

"We feel that it is inappropriate for an individual in his position with a black cloud hanging over him to simply wait out the end of his term," spokesman Matt O'Connor said in reference to Cunningham's announcement last month that he would not seek re-election to a ninth term.

The coalition, which typically endorses Democratic candidates and has a mailing list of about 3,000 people, also believes Cunningham is no longer an effective representative. It points to his low profile and few public appearances in the district since the initial news of his troubles.

"How can he do his work in Washington when he won't meet with voters?" O'Connor said. "If he is unable to do that, than clearly he is unable to serve."

Olson, Cunningham's press spokesman, said in his written statement that his boss has not been charged with any crime, has repeatedly denied any wrongdoing and has no intention of resigning.

"The congressman will continue to cooperate with the investigation, as well as continue his service to the people of the 50th District for which he was elected," he wrote. "The action taken by this group is just another partisan attack and a poorly directed publicity stunt."

The grand jury investigation centers around Cunningham and MZM, which reported a tripling of its Defense Department revenues around the same time that owner Wade purchased Cunningham's home.

Wade paid the 50th Congressional District representative $1.675 million for the home. According to Cunningham, Wade, who has refused all requests for interviews, said he wanted the house as a place for company officials to stay when in San Diego County.

In a written statement issued by Cunningham in June, he also said that Wade wanted to install communications equipment in the home. That never happened, and Wade sold the home less than a year after purchasing it for $700,000 less than he had paid.

Shortly after the home transaction was disclosed in mid-June, the North County Times reported that Cunningham also had been staying aboard Wade's 42-foot boat named the "Duke-Stir" on a rent-free basis whenever he was in Washington.