Wednesday, February 16, 2005
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Lichtman Overstepped Bounds as Settlement Judge in Orange County Clergy Sex Abuse Cases, C.A. Says
By KENNETH OFGANG, Staff Writer
Los Angeles Superior Court Judge Peter D. Lichtman overstepped his bounds by making factual findings, which could have bound the parties in future proceedings, as part of his efforts to settle sex abuse claims against the Diocese of Orange, the Court of Appeal for this district ruled yesterday.
Div. Eight granted a writ of mandate directing that Lichtman’s valuation of the cases, his order precluding the church’s insurers from declaring a forfeiture of coverage in the event the diocese settled without their consent, and findings which could have been used to establish bad faith by the insurers be vacated.
The ruling comes some six weeks after a $100 million settlement of the plaintiffs’ claims, about half of it coming from the insurers, was announced. In a footnote to his opinion yesterday, Justice Laurence Rubin said the court had not been formally notified of the settlement, and that it had not been asked to dismiss the writ proceeding as moot.
The Court of Appeal did not disclose how much Lichtman valued the cases at, citing the confidentiality of mediation proceedings under state law.
The Orange Diocese was the first in California to reach a settlement with alleged victims of clergy sexual abuse when they were minors. The cases are being managed as three separate coordination proceedings.
The Orange County cases—involving 90 claimants—as well as those brought by more than 500 claimants in Los Angeles County, are being overseen by Superior Court Judge Haley Fromholz. Lichtman was named settlement judge in 2003, but it was reported last week that he is being removed in the wake of the insurers’ complaints.
Those complaints stemmed from a series of orders issued on last year.
On April 30, Lichtman ordered the parties and insurers to participate in a “Valuation Hearing” after which the court would “render findings reflecting its determination of (i) the verdict potential for the sexual abuses cases if they were to proceed [to a jury trial], and (ii) the reasonable settlement value of such cases.”
According to the order, those findings were “intended to constitute an independent adjudication of liability and damages, based on an actual trial as that standard has been construed in California, and may be used by the parties or judicial officials in subsequent proceedings only to the extent lawfully permissible and for whatever legal relevance they may have.”
The insurers took a writ petition to the Court of Appeal, which advised that it would issue a peremptory writ in the first instance unless certain changes were made to delete those provisions suggesting the court had power to adjudicate as part of a settlement proceeding.
Lichtman made the changes set forth in the appellate panel’s order, and proceeded with the hearing.
Following the hearing, the judge issued a lengthy written order valuing the claims and declaring that the insurers—all of whom participated in the settlement discussions under a reservation of rights—were stymieing the settlement efforts by threatening to declare a forfeiture of coverage.
The judge said the parties would “have limited use of this Court’s order for the purpose of precluding the insuring carriers from announcing or declaring coverage forfeiture and for the parties[’] support of arguments alleging bad faith.”
The insurers then took another writ petition, which was the subject of yesterday’s ruling.
Rubin noted that under the Standards of Judicial Administration, settlement judges are expected to adhere to the mediation provisions of the Rules of Court when conducting settlement discussions, in particular with respect to the requirements that parties not be coerced into participating or into settling.
Lichtman, the justice said, had crossed over the line that separates aggressive mediation from coercive conduct.
“Despite the broad grant of authority to use different settlement or mediation techniques, nothing in the order [appointing him as settlement judge] can or should be read to allow Judge Lichtman to exceed the neutral, non-factfinding role of a mediator,” Rubin wrote.
The case is Travelers Casualty and Surety Company v. Superior Court, B176030.
Copyright 2005, Metropolitan News Company