TRANSMITTAL LETTER FOR BOARD MEETING OF MAY 15, 2008
COMMITTEE ON PURCHASING
Mr. Richard Lanyon, General Superintendent
Title
Issue purchase order and enter into an agreement with Loeb & Loeb LLP to pay attorneys’ fees incurred by Susan T. Morakalis in Tri-River Docks v. Metropolitan Water Reclamation District of Greater Chicago, Case No. 05 L 007390, in an amount not exceed $100,000.00, Account 101-30000-601170, Requisition 1242835
Body
Dear Sir:
On April 6, 2006, the Board of Commissioners issued orders authorizing the indemnification of Defendant Employee Susan T. Morakalis for attorneys’ fees in the matter entitled Tri-River Docks v. Metropolitan Water Reclamation District of Greater Chicago and Susan T. Morakalis. These orders were issued pursuant to an ordinance adopted on November 4, 1976, by the Board of Commissioners which indemnifies employees for costs and attorneys’ fees incurred by an employee in actions relating to District matters unless the employee is convicted of a crime.
Tri-River, a former District tenant, has alleged that the District and Susan T. Morakalis violated its civil rights because it was not afforded its due process rights when its lease was terminated. Tri-River Docks is seeking punitive damages against the individual defendant. Although punitive damages are not recoverable against the District, they can be sought against individuals. Under State law, the District is permitted to indemnify its employees for their costs incurred in the defense of such a claim, including punitive damages since no criminal action is involved.
On April 6, 2006, a Purchase Order 3038264 was issued to Sonnenschein Nath & Rosenthal LLP to represent Susan T. Morakalis in the subject lawsuit in an amount of $50,000.00. Ms. Morakalis was permitted to obtain separate counsel in this matter since she is being sued personally. The District is represented in this case by Schwartz, Cooper, Greenberger & Krauss.
On December 21, 2006, said Purchase Order was increased from $50,000.00 to $125,000.00. On May 3, 2007, said Purchase Order was increased to $200,000.00 and on December 20, 2007, it was increased to $300,000.00. To date, approximately $205,000.00 has been paid to Sonnenschein Nath & Rosenthal. Jeremy Margolis and Robert Andalman previously of Sonnenschein Nath & Rosenthal are representing Ms. Morakalis and billing at the hourly rate of $615.00 and $490.00, respectively.
On April 21, 2008, Ms. Morakalis’ attorneys (Mr. Margolis and Mr. Andalman) moved to the law firm of Loeb & Loeb LLP. So that Ms. Morakalis may continue to be represented by the same attorneys, it is recommended that a purchase order be issued to Loeb & Loeb LLP so that the work performed to date on behalf of Ms. Morakalis can continue to flow without interruption since the litigation has been pending for over two years. The issuance of a purchase order as requested is in the public interest and was not reasonably anticipated. Once issued, staff will close out the purchase order issued to Sonnenschein Nath & Rosenthal that has approximately $95,000.00 remaining.
As previously reported, Mr. Margolis specializes in civil defense work. Mr. Margolis is a former Assistant U.S. Attorney, served as Illinois Inspector General, and served as Director of the Illinois State Police. Mr. Margolis has provided counsel and guidance to officers, directors, and key employees of public and private companies. He has represented high ranking elected and appointed public officials. He has tried dozens of jury trials. Mr. Andalman specializes in civil practice and represents clients in civil rights cases and has vast practice before state, federal, and appellate courts. Mr. Margolis will continue to work for a reduced rate of $615.00 per hour, and Mr. Andalman has agreed to continue to work at a reduced rate of $490.00 per hour. Mr. Andalman performs the bulk of the work, and Mr. Margolis performs oversight and review work in an effort to keep the fees lower. Said purchase order may be issued without competitive bidding pursuant to the provisions of Section 11.4 of the Purchasing Act since the law firm of Loeb & Loeb and Messrs. Margolis and Andalman possess a high degree of professional skill.
In view of the foregoing, it is requested that the Purchasing Agent be authorized to issue a purchase order and enter into an agreement with the law firm of Loeb & Loeb LLP to represent Susan T. Morakalis in Tri-River Docks v. Metropolitan Water Reclamation District of Greater Chicago, et al., Case Number 05 L 007390 for an amount not to exceed $100,000.00.
Funds are available in Account 101-30000-601170.
Requested, Frederick M. Feldman, Attorney, FMF:CL:STM:nm
Recommended, Darlene A. LoCascio, Purchasing Agent
Respectfully Submitted, Barbara J. McGowan, Chairman Committee on Purchasing
ORDERED passed by affirmative roll call vote of a majority of the Commissioners present this May 15, 2008. Approved, President Terrence J. O’Brien