Exclusive: Trouble mounts for Costco optician who owns company in deadly fireworks blast
The investigations centered on former San Francisco resident Kenneth Chee, the 48-year-old owner and CEO of Devastating Pyrotechnics, whose operation in the farm town of Esparto was destroyed by fire on July 1, as the company prepared to put on Fourth of July displays in cities across Northern California. A series of blasts created a mushroom cloud visible from many miles away.
The Chronicle granted anonymity to the source, who was not authorized to speak about the investigation, in accordance with the newspaper's policies on confidentiality. Further details on the Southern California case were not immediately available.
The revelation that Chee, a San Ramon resident who has worked as an optician for Costco, was under investigation in Southern California comes after authorities raided a home where he once lived in San Francisco. On Tuesday, multiple law enforcement agencies searched the house on the 400 block of Second Avenue in the Inner Richmond neighborhood, which is owned by a relative of Chee who has been a manager at Devastating Pyrotechnics.
Records show that Chee built his business over many years, putting on Fourth of July and New Year's displays in numerous cities and becoming a well-known figure in his industry, even though federal regulators barred him from acquiring or possessing fireworks.
It's not clear why Chee was denied a crucial license by the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives. But as a 20-year-old man in September 1997, he was arrested for shooting a 14-year-old boy in a dispute in San Francisco, the Chronicle reported at the time. The next year, he was sentenced to five years in prison after being convicted of assault with a firearm. Under ATF regulations, anyone who has been convicted of a crime punishable by more than a year in prison cannot obtain a federal explosives license.
Two years ago, federal authorities approved a license for another man, Gary Chan Jr. of San Francisco — who is also associated with the Second Avenue home and appears to be Chee's half-brother — to operate Devastating Pyrotechnics, documents show. The Chronicle's efforts to reach Chan have been unsuccessful, and an attorney for Chee and Devastating Pyrotechnics has declined to respond to questions.
Despite his federal denial, Chee successfully obtained three fireworks licenses in his own name from the Office of the State Fire Marshal in California to import and export materials, sell fireworks and launch public displays, all on behalf of Devastating Pyrotechnics.
As the state fire marshal leads the investigation of the Yolo County blast, a central question is how — and where — Devastating Pyrotechnics was handling fireworks on the Esparto property. The site, 35 miles northwest of Sacramento, was zoned by the county for agriculture, and KCRA-TV reported it was owned by Sam Machado, a lieutenant with the Yolo County Sheriff's Office.
The Chronicle reported that the ATF's license approvals for Gary Chan Jr. allowed the company to store display-grade fireworks, but only in seven metal storage containers. Those containers were situated along an agricultural field on the northern edge of the property, according to maps reviewed by the Chronicle. The nearest container was about a third of a mile away from the buildings that blew up on July 1, and the company was not permitted to hold the display fireworks in the buildings on the main part of the property.
The fact that Chee was denied by federal regulators and approved by state officials highlights the differing and less stringent requirements in California for fireworks operators. The state only requires that a licensee not have a felony conviction 'involving explosives or dangerous fireworks' or a conviction as a principal or accessory 'in a crime against property involving arson or any other fire-related offense.'
One industry expert familiar with Chee, who asked to remain anonymous to avoid business repercussions, said the state needs to sync its regulations with the feds to avoid this type of situation. 'The two agencies are not on the same page,' this person said. 'To get federal licensing at Devastating Pyrotechnics, (Chee) had to use someone else's name with a clean past. Federally, Kenny can't be anywhere near fireworks.'
Chee had been let go from another fireworks company because he did not meet federal eligibility requirements, the expert said. 'Kenny is a very competent, capable pyrotechnician,' he said. 'But he doesn't meet the legal requirements.'
Still, Chee was able to grow his company without federal licensing after securing key contracts and building lasting relationships, including one with the Chinese Chamber of Commerce. For years, Devastating Pyrotechnics has run displays at the chamber's Chinese New Year Festival and Parade in San Francisco. This year, the company had locked up contracts for Fourth of July shows in cities including San Jose, St. Helena and Cloverdale — shows that had to be canceled.
The Chinese New Year parade director told the Chronicle this week that Devastating Pyrotechnics has been hired to do the event for 'more than 10 years.' Organizers worked directly with Chee and Neil Li, the company's general manager, who was reported missing by family members following the explosion. DNA analysis will determine whether he was among the victims whose remains were found.
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