Livingston seeking arbitration in FEMA case
LIVINGSTON — Livingston Parish will not be on the hook for the legal bills of a Washington, D.C., firm handling the parish’s case against the Federal Emergency Management Agency for Hurricane Gustav-related cleanup costs unless the parish wins money in arbitration, the lead attorney on the case said Thursday.
Although the parish is his client, attorney Hilary S. Cairnie of Baker Hostetler said he recommends the firm’s bills not be released to the public or even the Parish Council, at least until the case concludes. Parish President Layton Ricks has received copies of those bills, Cairnie confirmed.
The parish is seeking arbitration before the Civilian Board of Contract Appeals in Washington, D.C., for $59 million in unpaid invoices and administrative costs stemming from the parish’s debris removal efforts following the 2008 storm. FEMA has asked the judges panel to dismiss the case or, alternatively, delay it for 120 days.
The panel has not yet ruled on that motion.
Parish Council members questioned Cairnie extensively Thursday night about the details of the engagement letter Ricks signed with Cairnie’s firm Aug. 28 to handle the case. The council did not receive copies of that agreement until Jan. 15, after The Advocate published details of its contents.
The agreement raised concerns for several council members, who wanted to know whether the bank paying the firm’s bills would seek reimbursement from the parish, why it took so long for the council members to receive copies of the agreement, why they cannot see the firm’s bills and why the firm will speak only to Ricks and not council members.
Cairnie said Park National Corp., the bank whose subsidiary loaned debris contractor International Equipment Distributors more than $26 million, will want to be repaid for the legal bills it has paid on the parish’s behalf. However, under the parish’s agreement with the law firm, the parish has agreed to pay only if it recovers money from FEMA.
That part of the agreement resulted from aggressive negotiating by Ricks and parish legal adviser Christopher Moody, Cairnie said. Originally, the bank had wanted guaranteed reimbursement, he said.
Cairnie said the parish’s chances of recovery in the case are strong.
The Civilian Board of Contract Appeals has handled 48 FEMA arbitrations prior to this case, all of them dealing with hurricanes Katrina and Rita.
Of those 48, Cairnie said, roughly half resulted in judgments for the applicants and most of the rest ended in settlements. He said FEMA filed motions to dismiss in 47 of the cases, but only two were actually dismissed.
Cairnie said it was conceivable the legal fees in Livingston’s case could reach $2 million, but he strongly advised against releasing copies of the bills, even to the council members, for fear the documents would reveal the parish’s legal strategy.
In the bills, the firm has itemized its work, laying out for Ricks and Moody exactly what Baker Hostetler has been doing, who they have interviewed and research they have conducted. Releasing that information could jeopardize the parish’s case, Cairnie said.
“These are the family secrets, frankly, and we don’t want that information inadvertently leaving the parish, getting back to FEMA or being leaked to the media,” Cairnie said.
Cairnie said he also opposes releasing redacted copies of the bills because he is not sure whether they qualify as public records under Louisiana law.
“It’s my position that we should not assume they are until we know for certain,” he said.
Cairnie said his firm typically deals only with the executive body of a governmental entity because it needs a single point of contact.
In addition, in this case, certain council members may need to be called as witnesses, he said.
Parish officials will be able to attend the hearing, which is likely still months away, Cairnie said. He predicted the case would be concluded by September, but said he certainly could not guarantee it.
Editor’s note: This article was changed on Jan. 24, 2014, to correct the date on which the parish council received a copy of the agreement with the law firm handling the parish’s dispute with FEMA over Hurricane Gustav reimbursements.