In other developments, lawmakers indicated they may reject confirmation of Lottery Commission appointees who voted for the game and disclosed they are planning to unveil a bill today to make Mega Millions legal here, despite the lottery's claim it has not broken the law.
The lottery's admission to The Daily Review of unethical conduct in the growing furor came after accusations from attorneys opposing the lottery position on Mega Millions.
Attorneys representing an anti-gambling group, which filed a court challenge against Mega Millions as unconstitutional, claimed the lottery sent an agent and her assistant pretending to be freelance reporters to their Capitol news conference last week.
Asked about the allegation, lottery spokeswoman Rosa Escutia said, "Kim Smith did misrepresent herself as a freelance reporter. She works for the lottery as a special adviser." Attorneys Nicholas Roxborough of Woodland Hills and Fred Jones of Sacramento said Smith and an assistant taped answers to many legal questions put to their clients outside the attorneys' presence at the news conference, without their clients being represented by their lawyers.
The attorneys are demanding the tapes be preserved as evidence and that copies be turned over, along with any related notes or memos, to officials. If the lottery refuses, the attorneys threatened to seek a court order.
Escutia said the lottery has handed the matter over to its counsel, the state Attorney General's Office, which was not immediately available for comment.
"I can't comment on what her thinking was. That's a personnel issue. I'm sure it all will be handled appropriately," Escutia said.
Meanwhile, senators, who said they had been ready for routine approval of two of Gov. Arnold Schwarzenegger's Lottery Commission appointees, said they now plan to grill the officials about accusations the game exceeds the authority granted in the voter-approved Lottery Act.
"I have a number of questions about why the commissioners felt they had the legal authority to join Mega Millions and why they think it's a good idea for California," said Sen. Debra Bowen, a Redondo Beach Democrat who sits on the Senate Rules Committee.
"The legal opinion provided to the Legislature says that by joining Mega Millions, the Commission violated the Lottery Act approved by the voters back in 1984. I want to hear these commissioners respond to that opinion and hear why they felt it was necessary to rush into this deal with very little public notice," Bowen said.
Commissioners Loretta Doon of Belmont, a former California Teachers Association official, and John Mass of Los Angeles, executive vice president of the William Morris Agency Inc., were unavailable for comment.
Jones, representing the group suing the lottery, said, "If their Senate confirmations get held up or blocked, they have no one to blame but themselves."
Escutia responded, "We're confident in our lottery's legal opinion and that of the attorney general, and we will continue to conduct business as usual as we work toward resolution of the suit."
In addition, Sen. Dean Florez, a Bakersfield-area Democrat, said he will announce today he is introducing legislation to make the multistate Mega Millions legal.
"This measure could not only keep the state out of hot water legally, but it could provide the very boost to education that the Lottery Commission says it envisioned when it joined Mega Millions," Florez said.
"Rather than cannibalizing and existing game and causing funds to pour out of state, Mega Millions can still be turned into a positive for California's kids and schools," he said.
The lottery declined comment on the legislation.