Monday, July 28, 2003
Councilman Cannot Represent City in Lawsuit—A.G.
By a MetNews Staff Writer
A council member’s law firm cannot represent the city in litigation, even if no fees are charged, the firm pays all costs, and any court-awarded fees are donated to the city’s general fund, Attorney General Bill Lockyer said.
The attorney general, in an opinion released late Thursday, threw cold water on Thousand Oaks Councilman Ed Masry’s offer to have his firm represent the city in litigation to stop the Ahmanson Ranch development. The proposed development of more than 3,000 units on a 2,800-acre parcel in unincorporated Ventura County has the approval of the county’s Board of Supervisors, but has drawn opposition from other governments in the region.
Los Angeles County and the cities of Calabasas, Los Angeles, Agoura Hills and Malibu have sued to stop the project, citing fears of increased traffic and other environmental impacts.
Masry—whose Westlake Village firm of Masry & Vititoe became world-famous after its investigator, Erin Brockovich, became the subject of the eponymous hit movie—described his offer as a no-lose proposition for the city. But Lockyer said any such representation would violate the strict ban on conflicts of interest set forth in Government Code Sec. 1090.
The statute provides in part that “city officers or employees shall not be financially interested in any contract made by them in their official capacity, or by any body or board of which they are members.” Violators are subject to civil and criminal penalties, including imprisonment and disqualification from elective office.
A council member whose law firm provides free services in litigation would still have a financial interest, since the council member could be called upon to make decisions regarding the litigation that would affect the firm’s finances, the attorney general said.
“What might be in the best interests of the city in conducting the litigation and possibly entering into settlement negotiations may not be in the best interests of the law firm, and what might be in the best interests of the law firm may not be in the best interests of the city,” Lockyer wrote.
The attorneys, for example, might seek to minimize costs by farming out work to junior lawyers, using fewer attorneys, or taking less or slower discovery, whereas it might be in the city’s interest to litigate more aggressively at greater cost, Lockyer explained.
And if early court rulings go badly, the attorney general suggested, the firm might want to cut its losses and settle, while the city might be better off staying the course.
“In these circumstances,” Lockyer wrote, “the council member in question would likely be unable to devote ‘absolute loyalty and undivided allegiance’ to the city’s interests in controlling the conduct of the litigation as required under section 1090.”
The opinion, No. 03-302, was requested by Assemblyman Tony Strickland, a Republican who represents Thousand Oaks, on behalf of city officials, who raised the conflict-of-interest question when Masry made his offer last January. The opinion was prepared for Lockyer by Deputy Attorney General Daniel G. Stone.
Masry did not return a phone call seeking comment, but Thousand Oaks City Attorney Mark Sellers said he anticipated the opinion. “I almost could have written this,” he commented.
Sellers said that while he would be happy to discuss the case with Masry or any other council member, he is content to have the city litigate the case in-house, in consultation with counsel for the other public entity plaintiffs.
He said he was surprised by the criticism he received for having suggested that Masry and his firm would have what the city attorney considered an obvious conflict of interest. Many of the anti-Ahmanson Ranch activists, he said, are so fond of Masry they were willing to ignore the conflict and the potential implications of violating Sec. 1090.
Copyright 2003, Metropolitan News Company