This coming Wednesday, Aug. 8, the City Council is expected to vote on nine separate special counsel contracts. At a special council meeting two weeks ago to discuss those contracts, members of the public raised concern over the amount of money being spent on special attorneys when the city already has its own Law Department. However, according to the city's salaried attorney, Steven Kleinman, the city's litigation record has improved over the last few years. Officials have said that fighting lawsuits saves money in the long run. Kleinman couldn't say precisely how many cases were successful since the start of 2006. But he said, "We're definitely winning a lot more than we're losing."
There are currently between 15 and 25 lawsuits pending against the city, not including the "slip and fall" type lawsuits that are covered by the city's insurance.
The city's most costly lawsuit in the last 12 months was filed by Hoboken's former Parking Authority Executive Director Joann Serrano, who claimed she was the victim of sex and age discrimination and was awarded $400,000 by a jury for emotional distress. Serrano had been the head of the Parking Authority for many years, but a mayoral ally was tapped to help run the new Parking Utility.
The city, however, recently filed a post trial motion, which Kleinman said could result in a substantial reduction of the previously awarded sum.
Two significant contracts up for a vote
At the upcoming meeting, the council is expected to vote on the two most significant contracts, which according to Kleinman are with the law firms of Scarinci & Hollenbeck LLC, a politically-connected firm based in Lyndhurst, and Florio & Kenny LLP, based in Hoboken. That firm has connections to local politics, with one of the firm's partners being outgoing state Sen. Bernard Kenny Jr. Kenny is currently in the hospital recovering from an accident (see briefs)
. Both firms have worked for the city before. Florio & Kenny's contract will cap them at $100,000 for the year for legal services regarding worker's compensation and general litigation.
Scarinci & Hollenbeck's contract will not exceed $250,000, for labor issues and general litigation as well. Both firms are paid $135 per hour for their services.
According to a member of the council, it was the Florio & Kenny contract that led to last week's premature adjournment of the special City Council meeting, due to a request by Mayor Roberts to have more time to discuss the contract after learning that a council member was changing his vote.
Kleinman last week described the city's current Legal Department as a "corporate model," which like many corporations, avoids overhead and employee costs by outsourcing its work.
This is as opposed to an "in-house model," which would involve an entire legal staff paid by the city to deal with any matters that came before it.
According to Business Administrator Richard England, Hoboken had used the in-house model during the administrations of Cappiello and Pasculli. However, former Mayor Anthony Russo changed the model by using a single law firm, Murray, Murray and Corrigan.
Russo's budgets from the 1990s generally included $1.1 million for legal fees and expert testimony each year, but the city barely paid out any money from lawsuits.
Mayor Roberts created the current system of a one-man law department, which contracts most of its litigation out to other firms.
Kleinman currently has three assistant attorneys working on a part-time basis: Joseph Pojanowski, who handles Alcoholic Beverage Control Board issues, Vincent Lapaglia, who handles tax appeal work, and former Corporation Counsel Joseph Sherman, whom Kleinman replaced as the department head in April after Roberts asked for Sherman's resignation.
Sherman's current contract with the city, which itself was part of a settlement agreement, ends Sept. 30. Until that time, he handles whatever litigation Kleinman gives him.
Although $1.1 million is "a lot of money by anyone's standards," said Kleinman, who earns approximately $115,000 annually, he pointed out that in 2001, under the previous administration, the city spent over $1.3 million in legal representation. He said that when inflation is taken into account, that amount is substantially more than what is being spent today.
City sued for not providing documents
The majority of lawsuits filed against the city actually are not seeking monetary compensation for damages, said Kleinman, but rather, request certain information or try to change an ordinance.
Second Ward Councilwoman Elizabeth Mason filed seven lawsuits against Hoboken over the last few years in order to get what she believes are public records, via the Open Public Records Act (OPRA).
Kleinman said she has won two of the suits. The city won the other five, at the trial level, but four are headed to the Supreme Court.
Mason's two victories involved lessening the copier fees for getting documentation from the city, and a request for the city to provide its purchase orders from the business administrator.
Kleinman estimated the costs incurred by the city in litigation with Mason to be in excess of $200,000. Mason was elected to the City Council in June.
"[Mason's lawsuits] have been a tremendous waste of time, money, and effort for all involved," said Kleinman. "She's been very unsuccessful until now, and when you think of all the better things that could have been done with this money, it's sad."
Mason's attorney, Jeffrey Kantowitz, disagreed.
"[Mason's] litigation [has led to] a greater openness and transparency in government," Kantowitz said.
Over the years, several activists have complained about not being able to easily get documents from the city. When asked last week if she would reconsider her current lawsuits against the city now that she is a councilwoman, Mason said, "The issues are the same and the merits of the cases are the same as before. Whether I'm a regular citizen or a council person, it shouldn't matter."
Mason noted, "These issues are so important that the highest court in the state wants to hear them."
The city is also fighting a lawsuit from the company that created the software for the automated parking garage on Garden Street.
They also have spent more than $127,000 fighting a case for more than two years in which a man wants his neighbor's home inspected for water leakage into his own home, according to the plaintiff in that case.
Michael Mullins can be reached at email@example.com.