Monday, June 17, 2002
California governor's race: It looks like Gov. Gray Davis made another boneheaded decision that will end up costing California taxpayers more money -- and possibly deepen the state's budget woes, according to a report in the San Diego Union-Tribune.
The legal bills continue to pile up as Gov. Gray Davis tries to extricate himself from an embarrassing quagmire of his own making.
Davis is counting on a state appeals court to spare taxpayers from an $88.5 million award to attorneys who helped secure smog-fee refunds of $300 plus interest for more than 1 million motorists.
The state has paid outside counsel more than $500,000 to contest an arbitration panel's decision in favor of the attorneys, who include representatives of some of San Diego's most prominent law firms.
Why is this such a big snafu? Because the lawyers who are set to get $88.5 million in fees had agreed three years ago to accept just $18 million. Davis, not wanting to shell out that much offered to submit to binding arbitration and a three-person panel decided on the higher figure.
Davis' problem was that there were no ground rules going into arbitration.
(San Diego attorney Bill) Lerach said in his declaration that "we agreed there would be no floor and no ceiling." The three-member arbitration panel, chaired by retired state Supreme Court Justice Malcolm Lucas, unanimously ruled that the law firms were entitled to 13.3 percent of the $665 million set aside by lawmakers.
Why would Davis make this "no floor-no ceiling" concession going in? According to the article: "The San Diego firm and one of its partners, Bill Lerach, have been generous campaign donors to Davis and other Democrats."
If GOP-challenger Bill Simon loses to Gray Davis in November, he has only himself to blame. Davis has given Simon plenty of rope -- he just has to use it.