Best City Government to Sue in the U.S.

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Mayor Langford-his city loves paying lawyers.

In just 10 years, Atlantic City, New Jersey, pop. 35,000, has spent nearly $40 million defending itself from lawsuits according to the Press of Atlantic City. Between 2000 and 2009, the city has paid over $25 million in judgments and settlements and another $14 million in legal fees to local politically connected law firms.

According to legal experts, the amount far exceeds what would be considered typical for a city of its size and rivals the costs paid by much larger cities in the same area. In fact, the total cost of legal fees, settlements and judgments paid in Newark, New Jersey were about the same during the period, although Newark is eight times larger than Atlantic City.

The combined population of three nearby towns, Egg Harbor, Galloway and Hamilton are similar to the population of Atlantic City, and those communities collectively paid out $1.6 million in settlements and judgments over the same ten year period. Atlantic City’s payouts were 16 times higher.

“Those numbers are enormous,” said Paul J. Miola, director of the Atlantic County Municipal Joint Insurance Fund, or JIF. The JIF represents several local communities, but not Atlantic City which remains self-insured. “I think it’s an outrage that the city has not taken steps to control this problem. It’s a combination of poor management and political law firms dragging out litigation.”

The Press of Atlantic City had initially requested records in December 2008 documenting the legal costs as permitted by the Open Public Records Act, but the city delayed providing the information, or provided incomplete pieces with major settlements missing. More than a full year later, a full record of the payouts was received after repeated demands for complete and accurate documentation.

During the period 2000 to 2009, there were 368 lawsuit judgments and settlements, the largest of which were paid to city employees. Two mayors, Bob Levy and Lorenzo Langford, received settlements while still in office. The last three emergency management coordinators all received settlements or won lawsuits, and one former police chief was given $700,000 to settle two complaints over a four year period. Recently retired Police Chief John J. Mooney III is currently suing the city.

One of the costliest years for the city was 2001, when the tab for settlements and judgments came to $5.5 million. In that year, a whistleblower lawsuit was filed by police officer Gary Sutley who alleged rampant drug use with the department. After admitting the he was among the drug users, the city fired him. Sutley then sued the city and eventually took home a settlement of $2.8 million for his efforts.

Former police Chief Arthur Snellbaker sued the city in 1998 after claiming the mayor and other officials were conspiring to hinder his career, at the time he was ranked a police inspector. By the time he settled his discrimination claim for $233,000 in 2001, city leaders had already promoted him to police chief. Snellbaker sued again a few years later after being suspended for failing to comply with orders from the public safety director. This time, he collected $500,000.

Beyond the amounts paid for judgments and settlements, there is also the matter of paying law firms to handle the legal claims. The recently appointed head of the city’s legal department, G.Bruce Ward, said that in 2009 28 different law firms were paid to work on cases. “We’ve been working to minimize that number,” claims Ward, who has reduced the number of firms working on cases to 15 in 2010. “We can do better quality control with a smaller number of firms. And they’re easier to keep an eye on.”  Even so, the city shelled out $898,626 to law firms this year through July 2010. The annual average from 2000 to 2009 has been $1.4 million.

Many of the law firms on the city’s payroll are those with strong political connections to elected officials. One of those firms, DeCotiis, Fitzpatrick,Cole &Wisler, is known as one of the most politically connected in the state, and whose partner Michael DeCotiis was once head of the Casino Reinvestment Development Authority. The firm started donating to political action committees aligned with Mayor Langford when he took office in January 2002. Two months later, the city hired DeCotiis to defend the city’s approval of an $850,000 settlement for Langford and now-City Council President William “Speedy” Marsh.

Langford and Marsh sued after claiming then-Mayor Jim Whelan had retaliated against both of them when the city council cut Marsh’s $79,000 facilities coordinator job and Langford’s $30,000 per year liaison officer position after voters defeated a budget initiative. The state later nullified the $800,000 settlement citing “inherent conflicts.”

Press of Atlantic City

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