Amidst CalPERS suit, CIRM founder hosts megabucks Biden fundraiser

The man considered to be the father of the $12 billion California stem cell agency popped up in the news twice this month, once in a $38 million Sacramento lawsuit and then again as the host this month of a Biden campaign fundraiser whose tickets cost as much as $100,000.

Robert Klein and his wife, Danielle Guttman Klein, along with venture capitalist and former state Controller Steve Westly, are scheduled to put on a major Silicon Valley fundraiser for President Biden on Feb. 22 in tony Los Altos Hills, Ca.

Tickets for the Biden Victory Fund event start at $6,600. They rise to $25,000 for an “advocate,” $50,000 for co-hosts and $100,000 for hosts. Los Altos Hills is located on the San Francisco Peninsula. Its average home price stands at $5.4 million, according to Zillow, up 2.7 percent from last year.

Earlier this month, Klein’s name surfaced in news reports about a lawsuit filed by the mammoth California Public Employees Retirement System (CalPERS). The organization charged Klein with failing to pay $38.3 million that CalPERS is allegedly owed from a Los Angeles real estate deal. Klein denied the allegations as “provably false” in an email to Capitol Weekly.

Klein, a real estate developer, oversaw the drafting of the two ballot initiatives that created the stem cell agency and funded it with $8.5 billion in funds borrowed by the state. The agency will cost taxpayers at least an estimated $12 billion because of the interest payments.

Klein led both ballot initiative campaigns in 2004 and 2020. He was the first chairman of the agency, which is officially known as the California Institute for Regenerative Medicine (CIRM), serving from 2004 to 2011. The duties of the post are enumerated in the 2004 ballot initiative and include responsibilities that overlap with the president’s duties. The dual executive situation led to friction and was recommended for elimination in a $700,000, blue-ribbon study of CIRM, which commissioned the report. The agency has not acted on that recommendation.

Klein also founded and heads a stem cell research advocacy enterprise called Americans for Cures. In the past year or two, it has shifted its focus toward providing assistance to patients, which dovetails with a $2.5 million CIRM patient support program created by the 2020 ballot initiative that saved the agency from financial extinction.

The CalPERS lawsuit involved an apartment development project in the Los Angeles/Hollywood area. The deal was liquidated in 2020. CalPERS said that Klein’s firm failed to deliver $38.3 million that was owed after the liquidation.

In response to a query, Klein said via email that CalPERS’ allegations are “provably false” and that “CalPERS now seeks to avoid payments consistent with the prior approval.”

The deal with CalPERS involved an offshoot of Klein’s business called KCPCAL LLC. Another former CIRM board member, its salaried vice chair, Art Torres, has also been involved with KCPCAL. Torres was a longtime state lawmaker and former head of the state Democratic Party.

In a 2021 state-required financial disclosure, Torres reported receiving income of between $10,001 and $100,000 from the venture. By the time Torres was termed out of serving on the CIRM board last year, he was earning $289,692 annually as CIRM vice chair.

Torres also assisted in the 2020 initiative campaign that was run by Klein and assisted in the writing of the $5.5 billion Proposition 14. Torres reported receiving a payment in 2021 from the campaign of between $10,001 and $100,000 for the work, according to the documents reviewed by the California Stem Cell Report.

Jensen is a retired newsman and has covered CIRM for 19 years on his newsletter, the California Stem Cell Report. He authored the book, “California’s Great Stem Cell Experiment,” in 2020.