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Agenda Item
ASR
Control 21-001023 |
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MEETING DATE: |
12/07/21 |
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legal entity taking action: |
Board of Supervisors |
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board of supervisors
district(s): |
All Districts |
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SUBMITTING
Agency/Department: |
County Executive Office (Approved) |
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Department contact
person(s): |
Michael Alio (714) 285-5510 |
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Gary Stopforth (714) 285-5515 |
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Subject: Legal Fees for
Liability/Property Defense Panel
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ceo CONCUR |
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Clerk of the Board |
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Concur |
No Legal Objection |
Discussion |
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3 Votes Board Majority |
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Budgeted: Yes |
Current Year Cost:
See Financial Impact Section |
Annual Cost:
See Financial Impact Section |
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Staffing Impact: |
No |
# of Positions:
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Sole Source:
N/A |
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Current Fiscal Year Revenue: N/A
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Prior Board Action: 06/27/2017
#76, 05/24/2011 #11 |
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RECOMMENDED ACTION(S):
Approve updated liability/property defense panel services legal fees effective January 1, 2022.
SUMMARY:
Approval of the updated legal fees is required to retain the expertise of the current defense panel firms and to attract qualified firms during the 2022 Request for Proposals process for defense panel services.
BACKGROUND INFORMATION:
The liability/property defense panel (Panel) was established by the Board of Supervisors (Board), so specialized defense counsel would be available to protect the County's interests in the litigation process. The Panel consists of private law firms that are selected through the Request for Proposals (RFP) process. The current Panel was approved by the Board on June 27, 2017, for a five-year term through July 31, 2022. Board approval of the updated rates is requested in advance of the next RFP for Panel services in early 2022.
The County defends approximately 150 open litigated cases a year. The following table shows the number of new lawsuits each fiscal year and the fees charged to defend the existing 150 litigated cases each year.
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Fiscal Year |
# of Lawsuits |
Legal Fees |
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2016-17 |
88 |
$5,299,540 |
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2017-18 |
101 |
$5,474,699 |
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2018-19 |
115 |
$5,638,370 |
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2019-20 |
111 |
$2,610,768 |
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2020-21 |
73 |
$ 807,172 |
In FY 2019-20, COVID-19 started hindering court operations in February of 2020. The court, both Superior and District, closed completely a few months later, with no trial or settlement conferences taking place. When the courts reopened in FY 2020-21, a criminal backlog of trials existed that pre-empted civil trials. Civil trials continue to be delayed, trailing behind criminal trials into 2022 and 2023. The large variation in the amount of legal fees for FY 2020-21 is due to COVID-19 stopping civil trials and settlement conferences. In general, normal year-to-year variances are due to defending class action suits or one or two large exposure cases going to trial. Fees are expected to go up once the courts are hearing civil trials at a more regular pace again.
The current rates have been in place with no revisions since 2011. Two of the 14 firms advised County Executive Office (CEO)/Risk Management they are unable to take our civil rights cases due to the low hourly rates are currently authorized to pay.
In early 2020, CEO/Risk Management conducted surveys of the surrounding Southern California counties, cities and public agencies to determine the rates they are paying for legal defense. As expected, survey results showed a large discrepancy between the entities. As an example, the average hourly rates for partners involved in civil rights tort litigation varied from $157 to $400 per hour. The range of fees in the general tort arena ranged from $157 to $250. Additional review recently completed by CEO/Risk Management indicates the requested rates are competitive in the marketplace and will enable the County to continue to be represented by well-qualified law firms, but still mostly below average in cost to the County per hour.
In 2019 CEO/Risk Management was audited by CPS, an independent auditing firm. CPS stated, "The liability program is a well-run and well-managed operation."
At this time, CEO/Risk Management is requesting the Board approve new rates as shown below. CEO/Risk Management will be working with the County Procurement Office for release of an RFP in early 2022 to update and potentially enlarge our current defense panel. This fee structure will be included in the upcoming RFP to advise all such firms of the fees the County will be paying for its legal defense work. CEO/Risk Management anticipates returning to the Board with the outcome of the RFP process and recommendations as to any changes or additions to the defense panel prior to the July 31, 2022, end date of the current defense panel contracts.
There are currently three separate fee schedules in place as shown below, in effect since May 24, 2011. It is the recommendation of CEO/Risk Management that the County continue the current practice of paying defense counsel at different rates based on the level of experience and the types of litigation involved. CEO/Risk Management also recommends the creation of a new fee schedule for civil rights cases, which are currently included with general torts, to recognize the expertise needed for these cases.
CEO/Risk Management requests the following hourly rates for services rendered on or after January 1, 2022.
GENERAL TORT LITIGATION
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Service Levels |
Current Rate |
New Rate |
Survey Results Average |
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Partner |
$180 |
$215 |
$209 |
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Senior Associate |
$160 |
$185 |
$170 |
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Associate |
$135 |
$160 |
$167 |
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Paralegals |
$90 |
$105 |
$99 |
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Law Clerks |
$85 |
$100 |
$95 |
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Legal Assistants |
$80 |
$95 |
No comparable rate |
CIVIL
RIGHTS TORT LITIGATION
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Service
Levels |
Current Rate |
New Rate |
Survey
Results Average |
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Partner |
$180 |
$245 |
$249 |
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Senior Associate |
$160 |
$215 |
$223 |
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Senior Associate |
$135 |
$190 |
$208 |
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Paralegal |
$90 |
$115 |
$111 |
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Law Clerks |
$85 |
$110 |
$103 |
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Legal Assistants |
$80 |
$105 |
No comparable rate |
EMPLOYMENT/FLOOD
LITIGATION/LAND SUBSIDENCE LITIGATION
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Service Levels |
Current Rate |
New Rate |
Survey Results Average |
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Partner |
$200 |
$240 |
$249 |
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Senior Associate |
$175 |
$215 |
$223 |
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Associate |
$150 |
$190 |
$208 |
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Paralegal |
$95 |
$115 |
$111 |
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Law Clerks |
$90 |
$110 |
$103 |
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Legal Assistants |
$85 |
$105 |
No comparable rate |
ENVIRONMENTAL
LITIGATION
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Service Levels |
Current Rate |
New Rate |
Survey Results Average |
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Partner |
$240 |
$250 |
$249 |
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Senior Associate |
$190 |
$215 |
$223 |
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Associate |
$170 |
$190 |
$208 |
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Paralegal |
$95 |
$115 |
$111 |
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Law Clerks |
$90 |
$110 |
$103 |
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Legal Assistants |
$85 |
$105 |
No comparable rate |
FINANCIAL IMPACT:
Defense counsel costs are approximately $4 million per year and are included in the FY 2021-22 Property & Casualty Risk Internal Service Fund (294) budget, and will be included in the budgeting process for future years.
STAFFING IMPACT:
N/A
ATTACHMENT(S):
Attachment A - Panel Counsel Fee Range Public Entities