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Setback for county lawyers in lead paint suit

By rgordon
Thursday, April 5th, 2007 at 4:43 pm in Uncategorized.

Santa Clara County Superior Court Judge Jack Komar ruled Wednesday that San Mateo, Santa Clara and other Bay Area counties suing paint manufacturers for lead poisoning can’t pay their attorneys contingent on the outcome of the suit. The deal could have potentially yielded lawyers millions and kept jurisdictions from having to divert pricey fees away from tight budgets for years.

We reported in the print version of the Insider on March 24 (which, regretfully, we did not duplicate on this blog) that San Mateo County had hired big-time Burlingame law firm Cotchett, Pitre & McCarthy to represent it in the matter. (See previous post about Joe Cotchett’s connection to county Supervisor Jerry Hill.)

The suit alleges that several paint manufacturers and the Lead Industries Association caused and concealed significant health hazards, causing a public nuisance by promoting the sale of lead-based paint for decades while disregarding the health risks to children.

According to the terms of the contract, as we originally wrote, the county wouldn’t have to pay the firm a dime unless a settlement or judgment was reached in the case, called County of Santa Clara v. Atlantic Richfield Company et al. But if one was reached, the firm would have commanded reimbursement for all of its expenses for the case, plus 17 percent of the settlement, unless the court demanded a higher additional payout from the defendants specifically for attorney’s fees.

Now, Komar has ruled in favor of the defense’s request to toss that agreement structure out. Bonnie Campbell, the former attorney general of Iowa and spokeswoman for four of the seven defendants in the case – Atlantic Richfield Company (ARCO), Millennium Holdings, NL Industries and Sherwin-Williams – said that the ruling followed the precedent set by the California Supreme Court in a 1985 case. In that case, People ex rel. Clancy v. Superior Court, the city of Corona had retained a private attorney, James Clancy, under a similar contingency fee to pursue a public nuisance suit involving the sale of sexually explicit materials.

In his ruling, Komar said that the contingency fee arrangement between Corona and Clancy was “antithetical to the standard of neutrality that an attorney representing the government must meet when prosecuting a public nuisance abatement action.” In the lead paint case, he continued, “plaintiffs fail to persuasively distinguish [themselves from] Clancy, or otherwise persuasively articulate why their fee arrangements with outside counsel are proper.”

Santa Clara County filed the class action suit in 2000, and San Mateo County joined last year. Other counties on board as plaintiffs include Alameda, Solano, Monterey and Santa Cruz. The city and county of San Francisco have also joined, as has the city of Oakland. Most entities are represented by Cotchett’s firm.

The suing entities have 30 days to come up with new fee agreements. That is, of course, unless they appeal.

“That’s just a legal issue and frankly, one that one would expect gets resolved in the Court of Appeals,” said San Mateo County Counsel Tom Casey. “Legal determinations that have any precedence value have to be made by the Court of Appeals.”

“We think there’s a really good prospect the Court of Appeals will see it differently,” he added.

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